Bosphorus Hava Yollari Turizm ve Ticaret as v Minster for Transport, Energy and Communications (Case C-84/95)

• Jurisdiction: European Union
• Date: 30 July 1996
• Court: European Court of Justice

Court of Justice of the European Communities.

(Rodríguez Iglesias, President; Kakouris and Edward, Presidents of Chamber; Mancini, Moitinho de Almeida, Kapteyn (Rapporteur), Murray, Ragnemalm and Sevón, Judges; Jacobs, Advocate-General)1

Bosphorus Hava Yollari Turizm ve Ticaret AS

and

Minister for Transport, Energy and Communications, Ireland and the Attorney-General

Economics, trade and finance — Economic sanctions — Consequences — European Community law — Implementation in Community law of sanctions imposed by United Nations Security Council — Interpretation — Literal and purposive approaches — Yugoslavia — Security Council Resolution 820 (1993)— Council Regulation (EEC) 990/93 — Duty to impound aircraft in which undertaking based in or operating from the Federal Republic of Yugoslavia has a majority or controlling interest — Whether applicable to aircraft owned by such an undertaking but leased to undertaking outside Yugoslavia

Human rights — European Convention on Human Rights — Whether part of European Community legal order — Right to property — Nature and limitations — Public interest — Restrictions on right to property imposed in order to give effect to United Nations sanctions — Whether justifiable

International organizations — United Nations — Security Council — Enforcement action — Economic sanctions — Yugoslavia — Purpose of sanctions — Scope — Interpretation of relevant resolutions — Principles of interpretation — Resolution 820 (1993) — Sanctions Committee — Status of decisions of Sanctions Committee

International organizations — European Community — Implementation of sanctions imposed by United Nations Security Council — Effect of Security Council action in the European Community — Sanctions Committee decision — Whether binding on European Community

War and armed conflict — Economic warfare — Sanctions — Yugoslavia — The law of the European Community

Summary: The facts:—In 1992 Bosphorus Hava Yollari Turizm ve Ticaret AS (‘Bosphorus’), a Turkish company, dry leased an airliner from JAT, a Yugoslav airline. Following the imposition of economic sanctions upon the Federal Republic of Yugoslavia (Serbia and Montenegro) (‘the FRY’) later in 1992, Bosphorus paid the rent for the aircraft into a blocked account with the Central Bank of Turkey. Bosphorus operated the aircraft entirely independently, with its own crew and without any reference to JAT. JAT, however, remained the owner of the aircraft. In 1993 the United Nations Security Council adopted Resolution 820 (1993), paragraph 24 of which required all United Nations Member States to impound all aircraft in their territories in which a majority or controlling interest was held by a person or undertaking in or operating from the FRY.2 Pursuant to that resolution, the European Community adopted Council Regulation (EEC) 990/93, which gave effect to the relevant provisions of Resolution 820 (1993).3 In 1993 Bosphorus flew the aircraft to Dublin for maintenance work to be carried out by an Irish company. The Irish Government impounded the aircraft on the ground that, as it was owned by JAT, it fell within the terms of the Regulation and paragraph 24 of Resolution 820. The Sanctions Committee established by the United Nations Security Council declined to grant a request to permit the maintenance work to be carried out and gave its view that the aircraft should be impounded.4

The High Court of Ireland held that the Regulation was not intended to apply to an aircraft which, although owned by a Yugoslav company, was operated by an entirely independent company and over which no Yugoslav company had any control, as it could not have been the intention to take action which would harm an innocent non-Yugoslav company while having no effect on the trade embargo.5 The Supreme Court of Ireland, however, referred to the Court of Justice of the European Communities for a preliminary ruling on the following question:

Is Article 8 of Regulation 990/93/EEC to be construed as applying to an aircraft which is owned by an undertaking the majority or controlling interest in which is held by an undertaking in the Federal Republic of Yugoslavia (Serbia and Montenegro) where such aircraft has been leased by the owner for a term of four years from the 22nd April 1992 to an undertaking the majority or controlling interest in which is not held by a person or undertaking in or operating from the said Federal Republic of Yugoslavia (Serbia and Montenegro)?

Opinion of the Advocate-General:—Article 8 of the Regulation was applicable to such an aircraft.

(1) The context and objectives of the Regulation were inextricably bound up with Resolution 820 and other Security Council resolutions, which the Regulation was intended to implement within the Community. It was much more difficult to divine the precise purpose of a Community measure implementing a resolution of the Security Council than it would normally be to ascertain the purpose of an ordinary Community measure. What was in issue was not the intention of the Community institutions themselves but the purpose of the Security Council. A literal interpretation might therefore carry more weight (p. 283).

(2) A literal interpretation of paragraph 24 led to the conclusion that it applied to an aircraft owned by an undertaking in the FRY, even if that undertaking had no control over that aircraft at the relevant time. In adopting Resolution 820, the Security Council had not merely tightened the trade embargo but had acted to deprive undertakings in Yugoslavia of even a potential benefit which might be derived from their ownership of aircraft or vessels. The decision of the Sanctions Committee, although not binding, confirmed this interpretation (pp. 283–5).

(3) Respect for fundamental human rights, as enshrined in the European Convention on Human Rights, including the right to peaceful enjoyment of property, formed part of the Community legal order. Nevertheless, the duty to respect those rights did not lead to a different conclusion from that indicated by the interpretation of paragraph 24. The right to property was not absolute and could be limited in the general interest. There was a particularly strong public interest in enforcing embargo measures decided by the United Nations Security Council and designed to stop a particularly devastating civil war. It could not be said that the interference with the property rights of Bosphorus was wholly unreasonable (pp. 286–92).

Held:—The Court ruled that:

Article 8 of Council Regulation (EEC) No. 990/93 of 26 April 1993 concerning trade between the European Economic Community and the Federal Republic of Yugoslavia (Serbia and Montenegro) applies to an aircraft which is owned by an undertaking based in or operating from the Federal Republic of Yugoslavia (Serbia and Montenegro) even though the owner has leased it for four years to another undertaking neither based in nor operating from that republic and in which no person or undertaking based in or operating from that republic has a majority or controlling interest.

(1) In interpreting a provision of Community law, it was necessary to consider its wording, its context and its aims. Nothing in the wording of the relevant provisions of the Regulation indicated that they were not intended to apply to the case of an aircraft owned by an undertaking based in or operating from the FRY simply because that undertaking did not have control of the aircraft. In order to determine the aim and purpose of the Regulation, it was necessary to consider the text and aim of the relevant Security Council resolutions. The wording and purpose of paragraph 24 of Resolution 820 and the need for effectiveness all suggested that that paragraph applied to such aircraft (pp. 297–300).

(2) The fundamental rights invoked by Bosphorus were not absolute. The provisions of Regulation 990/93 served an important aim of applying economic sanctions decided by the Security Council in order to restore international peace and security. It was inevitable that the implementation of such measures would cause hardship to some economic operators but that hardship could not be regarded as inappropriate or disproportionate (pp. 300–2).

The text of the judgment of the Court commences at p. 293. The text of the Opinion of Advocate-General Jacobs commences on the opposite page.

OPINION OF ADVOCATE GENERAL JACOBS

delivered on 30 April 1996 *

1. At issue in this case is the effect of sanctions against the Federal Republic of Yugoslavia (Serbia and Montenegro) and the interpretation of a regulation of the Council of the European Union seeking to give effect to a number of resolutions adopted by the Security Council of the United Nations. The subject of the main proceedings is a decision taken by the Irish Minister for Transport, Energy and Communications (hereafter “the Minister”), in implementation of the regulation, to impound an aircraft owned by Yugoslav Airlines (hereafter “JAT”) but operated by Bosphorus Hava Yollari Turizm ve Ticaret A. S. (hereafter “Bosphorus Airways”), a Turkish air charter company. That company had leased the aircraft from JAT, prior to the adoption of the regulation, for a period of four years. The aircraft was stationed at Dublin Airport for the purpose of maintenance operations when the Minister took the contested decision. Before considering the facts in more detail I must set out the legal background of the case.

Legal background

2. In the course of the war in the former Yugoslavia the Security Council of the United Nations, which has primary responsibility under the Charter of the United Nations for the maintenance of international peace and security, adopted a number of resolutions requiring UN member States to adopt various embargo measures and other sanctions. The measures were adopted under Chapter VII of the Charter and were therefore binding on all UN member States.

3. The first such resolution was Resolution 713 (1991), adopted on 25...