Following is a short update on recent developments in EU export controls and sanctions laws. Our Export Control Team would be glad to assist you further should you have any questions or seek additional information.
1. European Commission proposes amendment to Annex I of the Dual-use Regulation
On 22 October 2014, the European Commission made a proposal to amend Annex I of the EU Dual-use Regulation (Regulation 428/2009). The Dual-use Regulation governs the control of exports, transfer, brokering and transit of dual-use items, and Annex I contains the list of dual-use goods, software and technology that require prior authorisation for export from the EU. The update reflects the recent changes in the international control regimes and concerns control modalities, technical descriptions, and the removal or addition of various dual-use items, e.g. graphite, frequency changers, machine tools, viruses and toxins, integrated circuits, explosives, and cybertools. Also, the update takes specifically into consideration the latest commercial and technological developments and growing security concerns regarding the use of surveillance technology and cybertools that could be misused in violation of human rights or against the EU's security. In addition, the update introduces new categories of items, such as IT intrusion software ('spyware') and telecommunication and internet surveillance equipment. The amendment will enter into force within two months unless the European Parliament or the Council of the European Union (Council) object.
2. Update on EU Sanctions
On 8 October 2014 the Council adopted Decision 2014/701/CFSP and Regulation (EU) No 1057/2014 which add the following persons connected to the Taliban or Haqqani Network to the list of persons against whom restrictive measures have been adopted under Decision 2011/486/CFSP and Regulation (EU) No 753/2011: Qari Rahmat, Qari Saifullah Tokhi, Yahya Haqqani, Saidullah Jan, and Muhammad Omar Zadran. The new legislation also amend the details of 14 persons already included in the restricted lists.
On 26 September 2014, 8 October 2014, and 4 November 2014, the Council adopted Regulation (EU) No 1022/2014, Regulation (EU) No 1058/2014, and Regulation (EU) No 1193/2014 respectively, which amend Regulation (EC) No 881/2002 on persons subject to a freezing of funds. Regulation 1022/2014 deletes one entry on the Al-Qaeda sanctions list, transfers one entry to another list on Taliban related sanctions, and updates the designation of another entry on the Al-Qaeda sanctions list. Regulation 1058/2014 adds 14 natural persons and two entities to the Al-Qaeda sanctions list. Lastly, Regulation 1193/2014 removes one entity from the Al-Qaeda sanctions list.
On 30 October 2014, the Council adopted Decision 2014/750/CFSP and Regulation (EU) No 1159/2014 which amend Decision 2012/642/CFSP and Regulation (EC) No 765/2006 respectively. Decision 2014/750/CFSP extends the duration of the restrictive measures against Belarus to 31 October 2015. The restrictive measures include an arms embargo against Belarus, as well as a travel ban, and a freezing of funds against specified persons and entities. Regulation (EU) No 1159/2014 removes 24 persons and 7 entities from the scope of the sanctions due to the fact that there are no longer grounds for including them.
On 20 October 2014, the Council adopted Decision 2014/728/CFSP which renews the asset freezes and travel bans contained in Decision 2010/638/CFSP and Regulation (EU) No 1284/2009 until 27 October 2015.
On 20 October 2014, the Council adopted Decision 2014/727/CFSP and Regulation (EU) No 1102/2014, which amend the scope of the arms embargo set out in Article 2 of Decision 2011/137/CFSP and Article 3(2) of Regulation (EU) No 204/2011 respectively. Also, on 20 October 2014, the Council adopted Regulation (EU) No 1103/2014 which amends Regulation (EU) No 204/2011 to add the following persons to the list of persons subject to sanctions due to their involvement or complicity in ordering, controlling, or otherwise directing, the commission of serious human rights abuses against persons in Libya: Abu Zayd Umar Dorda and Colonel Abdullah Al-Senussi.
On 30 October 2014, the Council adopted Decision 2014/751/CFSP which extends the duration of the restrictive measures against the leadership of the Transnistrian region to 31 October 2015. The measures were adopted by Decision 2010/573/CFSP and impose a travel ban on persons who are responsible for the design and implementation of the campaign of intimidation and closure of Latin-script Moldovan schools in the Transnistrian region.
On 8 October 2014, the Council adopted Decision 2014/700/CFSP and Regulation (EU) No 1059/2014 which add the company Ocean Maritime Management Company Limited to the list of companies subject to sanctions outlined in Decision 2013/183/CFSP and Regulation (EC) No 329/2007, and remove the natural person Jon Pyong-Ho from the list of sanctioned individuals. The measures also update the identification details for several individuals and companies.
On 28 October 2014, the Council adopted Decision 2014/742/CFSP and Regulation (EU) No 1145/2014 which repeal travel bans and asset freezes against Slobodan Milošević and persons associated with him. The Council considers that these persons no longer represent a threat to the consolidation of democracy in the former Yugoslavia and, consequently, there are no grounds to continue applying those restrictive measures.
On 20 October 2014, the Council adopted Decision 2014/729/CFSP and Regulation (EU) No 1104/2014 which add two natural persons, Maalim Salman and Ahmed Diriye, to the list of restricted persons established by Decision 2010/231/CFSP and Regulation (EU) No 356/2010.
On 26 September and 20 October 2014, the Council amended Regulation (EU) No 36/2012 by adopting Regulation (EU) No 1013/2014, Decision 2014/730/CFSP and Regulation (EU) No 1105/2014, which add 17 new persons and 2 new entities to the list of sanctioned individuals and entities connected to the Assad regime in Syria, and update the information of two designated entities. Notably, Regulation 1013/2014 again designates Mr Samir Hassan after his previous inclusion in the sanctions list had been annulled by the EU General Court.
On 15 October 2014, the Council issued two press releases stating that: 1) Montenegro, Iceland, Albania, Liechtenstein, Norway, and Ukraine will align their national regimes to the list in Decision 2014/658/CFSP and Decision 2014/145/CFSP of restricted persons seen to be undermining or threatening the integrity, sovereignty and independence of Ukraine; and 2) Montenegro, Iceland, Albania, Norway, and Ukraine will align their lists of entities subject to sanctions to include specific Russian financial institutions, and defence and energy companies included in Decision 2014/659/CFSP and Decision 2014/512/CFSP. For further information on the sanctions in relation to the current situation in Ukraine and Russia, click here.
3. Case law developments
On 24 September 2014, in its judgment in Case T-348/13 – Kadhaf Al Dam v Council (not yet available in English), the EU General Court annulled the designation of Mr. Al Kadhaf Dam, a cousin to Muammar Qadhafi, under the Libya sanctions. The Council had included Mr. Al Kadhaf Dam in 2011 at the height of the crisis in Libya. However, the Council did not provide proof of its reasons for his retention in the list following the fall of the Qadhafi regime in Libya. The Court suspended the effect of its judgment pending a possible appeal by the Council.
On 16 October 2014, in its judgment in Joined Cases T-208/11 and T-508/11 – Liberation Tigers of Tamil Eelam (LTTE) v Council, the EU General Court annulled the inclusion of the LTTE on the EU terrorist list.
LTTE had raised seven pleas in law: (i) inapplicability of Regulation No 2580/2001 to the conflict between the LTTE and the Government of Sri Lanka; (ii) wrongful categorisation of the LTTE as a terrorist organisation for the purposes of Article 1(3) of Common Position 2001/931; (iii) lack of any decision taken by a competent authority; (iv) failure to undertake the review required under Article 1(6) of Common Position 2001/931; (v) breach of the obligation to state reasons; (vi) infringement of the rights of defence and the right to effective judicial protection; and (vii) infringement of the principles of proportionality and subsidiarity. The Court found that, notwithstanding the applicability of Regulation No 2580/2001 to terrorist acts within the context of armed conflict, the Council could not classify the Indian authorities as "competent authorities". Consequently, the Council had not based its sanctions on decisions by competent authorities as it should have done, and further, it had actually based its sanctions on factual inferences derived from the press and the internet. The Court therefore annulled the contested measures inter alia for failure to state reasons.
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