European Court Rules on UN and EU Terrorist Suspect Blacklists
In a number of recent judgements, the European Court of First Instance (CFI) has considered actions seeking annulment of two European Community measures adopted pursuant to different counter-terrorism regimes established by the United Nations Security Council. A Community Regulation transposing the sanctions regime created by Security Council Resolution 1267 (1999) into Community law and directly linked to the list maintained by the UN Sanctions Committee has only been subjected to limited review. The second measure, adopted pursuant to a Community Regulation which implements Security Council Resolution 1373 (2001) and created a list of targeted persons maintained by the Council of the European Union itself, has been fully scrutinized, found to be in violation of fundamental rights and thus declared invalid.
On 19 October 2005, Security Council Resolution 1267 (1999) imposed financial sanctions on the Taliban regime in Afghanistan and established a Sanctions Committee, composed of all members of the Security Council and responsible for overseeing the implementation of sanctions. The Committee was also tasked with the maintenance of a list of the individuals and entities designated as associated with the Taliban or Usama bin Laden, based on unspecified information provided by governments and regional organizations. Names are added to the list by consensus on the proposal of a government.
The functions of the Committee have been modified and expanded by a number of subsequent resolutions. In particular, Resolution 1390 (2002) extended the applicability of a wider range of sanctions (now including assets freeze, travel ban, and arms embargo) to the "Al-Qaida network" and "other individuals, groups, undertakings and entities associated with them". Derogations from the freezing of funds may be granted by states on humanitarian grounds with the consent of the Sanctions Committee.
The Sanction Committee's procedures have been subject to growing criticism due to the lack of transparency and due process safeguards. Persons listed do not have the right to be heard, nor the right of access to an impartial review body at the UN level, nor the right to be informed of the reasons for their designation. The Guidelines of the Sanctions Committee set up a so-called de-listing procedure, whereby listed persons, through their governments, can address a request to the Sanctions Committee to be removed from the list. Decisions about de-listing are made unanimously, thus requiring the consent of the original designating government or at least of the permanent Security Council members.
The Council of the European Union, taking the view that action on the part of the European Community was necessary to implement the resolutions, adopted a series of Common Positions, which in turn were put into effect by the European Community through the adoption of, inter alia, Regulation No. 881/2002. Annex I contains the list of persons affected by the freezing of funds imposed by Article 2 and is maintained on the basis of determinations made by either the Sanctions Committee or the Security Council.
Community Regulations are, unlike UN Security Council resolutions, directly applicable in the domestic legal orders of EU member states, thus do not require further legislative action. Furthermore, according to long-standing European Court of Justice (ECJ) jurisprudence, Community legislation takes precedence where it clashes with domestic law, including constitutional law. Subject to certain reservations, Member State courts will generally give precedence to Community law over national law. In addition, only the Community Courts are competent to rule on the validity of Community legislation, which can be challenged on the ground that the measure violates primary law of the EU, including fundamental rights as protected by the Community legal order.
II. Actions for Annulment
The Yusuf, Kadi, Ayadi and Hassan cases concerned Community Regulation No. 881/2002 which was adopted pursuant to Security Council resolutions establishing the 1267 sanctions regime. Persons resident respectively in Sweden, Ireland, Great Britain and Saudi Arabia were all listed in its Annex and sought its annulment on the grounds, inter alia, that it infringed their rights to property, to a fair hearing, and to an effective judicial remedy.
In principle, the Community is based on the rule of law, meaning that all Community acts are subject to review through the two European Courts. However, in the two nearly identical judgements of Yusuf and Kadi (21 September 2005), the Court considered whether it was barred from exercising jurisdiction over Regulation No. 881/2002 because to do so would mean engaging in an indirect review of the Security Council resolutions which the Regulation meant to implement and which left no discretion to the Community. By contrast, the Court notably chose not to discuss its possible lack of competence to review the Common Positions of the EU Council which the challenged Regulation sought, in the first place, to implement. Instead, the Court first examined the relationship between SC resolutions and Community law, finding that the former take precedence over the latter, including over fundamental rights as protected by the Community. As a further step, however, the judges then went on to consider whether the Regulation violates jus cogens, and held that is does not.
The Court rejected an argument put forward by the applicants that the Community legal order was autonomous from SC resolutions. Regarding the effect of SC resolutions on member states, the judges relied on both international and Community law. Citing Articles 25, 48 (2), 103 of the UN Charter and Article 27 of the Vienna Convention on the Laws of Treaties, the Court concluded that the obligations arising under the Charter prevailed over any other obligation, including the obligation under Community law to respect fundamental rights. The same result was generated by an analysis of Community law. In particular, Article 307 (1) of the EC Treaty stipulates that application of the treaty does not affect the duty of member states to perform their obligations under agreements concluded before the establishment of the Community or the accession thereto, including those stemming from the UN Charter.
The same arguments serve as a basis for the Court to establish in a second step that the Community as such - including the Court - is bound by SC resolutions. The judges reasoned that Community law, including fundamental rights, must be interpreted and its scope limited in the light of the obligations of member states under international law. In so far as the Community assumes competences previously exercised by member states in an area governed the UN Charter, it must be considered bound by it. Consequently the Court held that it had no authority to call into question the lawfulness of the resolutions which the contested Regulation sought to implement.
Nonetheless, the Court then went on to discuss potential limits on the powers of the Security Council, concluding from Articles 53 and 64 of the Vienna Convention on the Laws of the Treaties and Article 1 (3) of the UN Charter that the Security Council is bound by jus cogens, to which the judges referred to as "understood as a body of higher rules of public international law binding on all subjects of international law, including the bodies of the United Nations, and from which no derogation is possible".
Apparently assuming that the Court's own review competence follows from these limits on Security Council powers, the judges refer in the subsequent analysis to the Universal Declaration of Human Rights, the European Convention on Human Rights (ECHR) and to Community case law concerning fundamental rights. The judges do not question whether the human rights norms examined constitute jus cogens, and do not discuss other relevant case law pertaining to ius cogens or the consequences if a measure is in violation of jus cogens. In particular, with regard to the right to a fair hearing, the judges opined that the possibility for governments to exercise diplomatic protection through the de-listing procedure was "not improper" in the light of mandatory law. Equally, the fact that the applicants are left ignorant of the reasons for their inclusion in the list did not constitute a violation of the applied standard. Concerning the right to an effective judicial remedy, the judges noted the limited scope of their own review and agreed with the applicants that there is no other judicial remedy available to the persons listed, but ultimately held that this gap in judicial protection was not contrary to jus cogens, because the limitation on that right was justified by the nature of Security Council decisions and the legitimate objective they pursued. Under such circumstances, the judges found that the de-listing procedure afforded adequate protection of the applicants' rights.
In Ayadi and Hassan, two judgements on similar cases rendered on 12 July 2006, the CFI held that member states must respect the fundamental rights of affected persons and are thus under an obligation to ensure, as far as possible, that those persons, when presenting a request to have a case reviewed, have an opportunity to put their point of view before to the competent national authorities. Where such a request is rejected, affected persons should be able to bring an action for judicial review of that decision on the basis of either the Regulation in question or domestic law.
In contrast to the limited review applied to cases where measures implementing the 1267 regime were at issue, the CFI annulled on 12 December 2006 a Community decision taken pursuant to Community Regulation No. 2580/2001 implementing SC Resolution 1373 (2001). The Resolution obliges states to freeze financial funds and take certain additional measures to prevent and prosecute terrorist activities but, unlike the 1267 regime, leaves the identification of suspected persons (other than those covered by Resolution 1267) and the procedure for freezing funds to states. Thus, Regulation No. 2580/2001 empowered the EU Council itself to maintain the list of persons to whom sanctions apply. The Council decides unanimously on the basis of "precise information or material which indicates that a decision has been taken by a competent authority", "competent authority" meaning a national judicial authority, which appears to exclude intelligence sources. Affected persons are not notified of the evidence or reasons that led to their inclusion in the list.
Since the establishment and maintenance of the list entails the exercise of discretion on the part of the Community, the CFI stated that fundamental rights are fully applicable, suggesting that the degree of judicial protection depends on whether the applicant is covered by the 1267 or the 1373 regime. The Court conceded that the Council enjoyed broad discretion when updating the list, but found itself otherwise competent to conduct a full review of the decision by which the applicant's name was added. Noting that the restrictions imposed by the Council on the right to a fair hearing must be offset by a strict judicial review, it held that the absence of information regarding the circumstances leading to the inclusion in the list not only infringed the applicant's right to a fair hearing but also his right to effective judicial protection, since lacking such information the Court was incapable of reviewing the lawfulness of the decision. Consequently, the decision was annulled.
III. Further developments and implications
On 29 November 2006, the Sanctions Committee amended its listing guidelines, requiring states to provide more detailed information on the reasons why individuals or entities should be listed and providing for a review mechanism for names that have been on the list for at least four years without update. On 19 December 2006, Security Council Resolution 1730 created a focal point within the UN Secretariat responsible for processing submissions by listed persons requesting the lifting of sanctions. Although this enables affected persons to submit petitions directly and independently of diplomatic protection through their governments, it does not give them the right to participate in the review process, nor does it constitute an independent review mechanism. Removal from the list is still possible only with the consent of all governments represented in the Committee.
Further cases are pending before the CFI. The applicants in the Yusuf, Kadi, Hassan, and Ayadi cases have filed for appeal before the European Court of Justice (ECJ) which, in a 1996 precedent, did check a Community regulation implementing SC resolutions with regard to fundamental rights as protected by Community law. Of note is that that case concerned sanctions directed against a state, not against the firm whose rights were affected rather accidentally.
The outcome of these appeals will be relevant for other potential challenges to the implementation of the 1267 regime. In the past, the European Court of Human Rights has noted that notwithstanding the transfer of competences to an international organization, parties to the ECHR remain responsible for ensuring the protection of Convention rights. The rebuttable presumption has been that states merely complying with obligations flowing from their membership in an international organization are justified as long as that organization protects human rights in a manner that is, at the least, equivalent to that for which the ECHR provides. On the domestic level, the German Constitutional Court, for instance, has declared challenges against German state action implementing Community measures inadmissible on similar grounds.  To date the protection of fundamental rights provided by Community law has been deemed to meet this minimum requirement of equivalent protection. In the continuing absence of an independent review mechanism, it would be a long stretch to argue that the same can be said of the UN. Whether or not the ECJ chooses to confirm the ius cogens review standard established by the CFI, should Resolution 1730 be the last word on the listing and de-listing procedure of the Sanctions Committee, difficult questions regarding the relationship between the Security Council, the Community courts, the European Court of Human Rights, and domestic courts are likely to persist.
Chia Lehnardt is a doctoral student at Humboldt University, Berlin and a consultant to the Institute for International Law & Justice, NYU School of Law.
 See, in particular, Resolutions 1333 (2000), 1333 (2000), 1390 (2002), 1452 (2002), 1455 (2003), 1526 (2004) 1617 (2005).
 See World Summit Outcome document, UN Doc. A/Res/60/1 (2005), para. 109; Report of the Secretary-General's High Level Panel on Threats, Challenges and Change, UN Doc. A/59/565, para. 152.
 Guidelines of the Committee for the conduct of its work, adopted on 7 November 2002, last amended on 29 November 2006, section 8, available at http://www.un.org/Docs/sc/committees/1267/1267_guidelines.pdf.
 CFI, Yusuf and Al Barakaat International Foundation v Council of the European Union and the Commission of the European Communities, Case T-306/01; Kadi v Council of the European Union and the Commission of the European Communities, Case T-315/01; Ayadi v Council of the European Union, Case T-253/02; available at http://curia.europa.eu/.
 The applicants also alleged that the Community lacked competence to adopt the contested Regulation, see Yusuf, paras. 79.
 Art. 46 EU Treaty contains a list of competences which are open to judicial examination. Common Positions concerning foreign and security policy issues are not included.
 Yusuf, paras. 232.
 Ibid, paras. 242.
 Ibid., para. 276.
 Ibid. para. 277. The German translation of the judgment reads "ius cogens, understood as an international public order(...)".
 Ibid., para. 282.
 Ibid., para. 341-345.
 Ayadi v. Council of the European Union, Case T-253/02; Hassan v Council of the European Union and Commission of the European Communities, Case T-49/04.
 Organisation des Modjahedines du people d'Iran v. Council of the European Union, Case T-228/02.
 Art. 2 (3) EC Reg. 2580/2001, Art. 1 (4) Common Position 2001/931/CFSP. The most recent list is included in Common Position 2006/380/CFSP (30 May 2006).
 Organisation des Modjahedines du people d'Iran, paras. 99-108; 113.
 Othman v Council of the European Union and the Commission of the European Communities, Case T-318/01; Sison v Council of the European Union, Case T-47/03.
 Bosphorus v Minister for Transport, Energy and Communications, Case C-84/95, Judgment of 30 July 1996, paras. 19. See also Gestoras Pro Amnistia and others v Council of the European Union, Case C-354/04 P.
 Bosphorus v Ireland, Appl. No. 45036/98, Judgment of 30 May 2005, para.155. See also para.145.
 "Solange II", Decision of 22 June 1986, BVerfGE 73, pp. 339.
 See Gestoras Pro Amnistia, Opinion of Advocate General Mengozzi, 26 October 2006, in particular paras. 85.