Thursday, 5 February 2009

EU Law: Restrictive measures (sanctions)

The Treaty of Lisbon would upgrade the European Union’s treaty provisions against oppressive third countries, dictators and their henchmen as well as their foreign assets.

Legal safeguards have been solemnly promised, but in the combat against terrorism we saw how persistent the EU Council was in ignoring its own principles.




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Current treaty

Article 301 of the existing Treaty establishing the European Community (TEC) provides for decisions on economic sanctions in two stages.

First there has to be a CFSP (common foreign and security policy) common position or joint action providing for economic measures against a third country.

Then the concrete measures are taken by the Council by a qualified majority on a proposal by the Commission.

The text of Article 301 TEC is from the latest consolidated version of the treaties, OJEU 29.12.2006 C 321 E/177:


Article 301 TEC

Where it is provided, in a common position or in a joint action adopted according to the provisions of the Treaty on European Union relating to the common foreign and security policy, for an action by the Community to interrupt or to reduce, in part or completely, economic relations with one or more third countries, the Council shall take the necessary urgent measures. The Council shall act by a qualified majority on a proposal from the Commission.


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In addition, restrictive financial measures (on the movement of capital and payments) with regard to third countries are provided for in Article 60(1) TEC (page 65):


Article 60(1) TEC

1. If, in the cases envisaged in Article 301, action by the Community is deemed necessary, the Council may, in accordance with the procedure provided for in Article 301, take the necessary urgent measures on the movement of capital and on payments as regards the third countries concerned.


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Original Lisbon Treaty

Article 2, point 169 of the original Treaty of Lisbon (ToL) inserted a new Title IV on restrictive measures and a new Article 188k (OJEU 17.12.2007 C 306/96):



RESTRICTIVE MEASURES

169) The following Title IV and Article 188 K shall be inserted, replacing Article 301:

‘TITLE IV
RESTRICTIVE MEASURES

Article 188 K

1. Where a decision, adopted in accordance with Chapter 2 of Title V of the Treaty on European Union, provides for the interruption or reduction, in part or completely, of economic and financial relations with one or more third countries, the Council, acting by a qualified majority on a joint proposal from the High Representative of the Union for Foreign Affairs and Security Policy and the Commission, shall adopt the necessary measures. It shall inform the European Parliament thereof.

2. Where a decision adopted in accordance with Chapter 2 of Title V of the Treaty on European Union so provides, the Council may adopt restrictive measures under the procedure referred to in paragraph 1 against natural or legal persons and groups or non-State entities.

3. The acts referred to in this Article shall include necessary provisions on legal safeguards.’.


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Take note of Article 2, point 64 of the original Treaty of Lisbon, with Article 61h concerning the freezing of funds of natural or legal persons, groups or non-State entities in the context of preventing and combating terrorism.


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Consolidated Lisbon Treaty


With the Lisbon Treaty in force, the renumbered Article 215 of the Treaty on the Functioning of the European Union (TFEU) would look like this, as presented in the consolidated version of the treaties, OJEU 9.5.2008 C 115/144:

TITLE IV
RESTRICTIVE MEASURES

Article 215 TFEU
(ex Article 301 TEC)

1. Where a decision, adopted in accordance with Chapter 2 of Title V of the Treaty on European Union, provides for the interruption or reduction, in part or completely, of economic and financial relations with one or more third countries, the Council, acting by a qualified majority on a joint proposal from the High Representative of the Union for Foreign Affairs and Security Policy and the Commission, shall adopt the necessary measures. It shall inform the European Parliament thereof.

2. Where a decision adopted in accordance with Chapter 2 of Title V of the Treaty on European Union so provides, the Council may adopt restrictive measures under the procedure referred to in paragraph 1 against natural or legal persons and groups or non-State entities.

3. The acts referred to in this Article shall include necessary provisions on legal safeguards.


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Comments

Article 215 TFEU brings economic and financial sanctions against third countries under one roof, combining Articles 301 and 60(1) TEC.

The common foreign and security policy (CFSP) and the ‘Community pillar’ are brought together by the joint proposal from the High Representative and the Commission. (Since the High Representative would be a member of the Commission, as one of its Vice Presidents, the proposal would take CFSP aspects into account anyway, without the TFEU provision stating the obvious.)

The concrete implementing decision is based on a preceding political CFSP decision, much like today. According to Article 31(1) of the amended Treaty on European Union (TEU) unanimous decisions remain the main rule (whereas most implementing decisions can be taken by qualified majority voting; cf. paragraphs 2 to 5). Article 215 TFEU follows the same logic.

The European Parliament gets a formal right to be informed about the decisions.

We took note of the current Article 60 TEC, amended to counter terrorism and renumbered Article 61h ToL and moved to the Title on the area of freedom, security and justice. The provision concerns non-state actors in the context of combating terrorism and it has become Article 75 TFEU in the consolidated treaty.

Article 215(2) TFEU offers a legal base for sanctions against other natural or legal persons and groups or non-State entities, such as repressive dictators, their regimes and their economic and financial interests. These decisions as such are not new, but they have been based more precariously on the existing provisions in combination with the flexibility clause (Article 308 TEC).

The legal safeguard promised are most welcome. They are underlined by both the third paragraph and by Declaration 25 (below).

The substance of Article 215 TFEU is the same as Article III-322 of the Constitutional Treaty, which was based on Article III-224 of the draft Constitution, but with paragraph 3 on legal safeguards added.


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Declaration 25

Among the declarations annexed to the final act of the intergovernmental conference which adopted the Treaty of Lisbon underlines the importance of legal safeguards (OJEU 9.5.2008 c 115/346):

25. Declaration on Articles 75 and 215 of the Treaty on the Functioning of the European Union

The Conference recalls that the respect for fundamental rights and freedoms implies, in particular, that proper attention is given to the protection and observance of the due process rights of the individuals or entities concerned. For this purpose and in order to guarantee a thorough judicial review of decisions subjecting an individual or entity to restrictive measures, such decisions must be based on clear and distinct criteria. These criteria should be tailored to the specifics of each restrictive measure.


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Sanctions

Untied Nations

The United Nations and the Security Council play a central role with regard to international sanctions. Therefore, an overview of sanctions could start from the home page UN Security Council Sanctions Committees:

http://www.un.org/sc/committees/index.shtml


European Union


The Commission offers web pages on CFSP sanctions:

http://ec.europa.eu/external_relations/cfsp/sanctions/index.htm

There are pages on Sanctions or restrictive measures in force (measures adopted in the framework of the CFSP):

http://ec.europa.eu/external_relations/cfsp/sanctions/measures.htm

There is also a page with links to Consolidated list of persons, groups and entities subject to EU financial sanctions:

http://ec.europa.eu/external_relations/cfsp/sanctions/list/consol-list.htm



Ralf Grahn