Islamic Republic of Iran Shipping Lines and Others v Council of the European Union.

• Jurisdiction: European Union
• Court: General Court (European Union)
• Writing for the Court: Pelikánová
• ECLI: ECLI:EU:T:2013:453
• Date: 16 September 2013
• Docket Number: T-489/10
• Procedure Type: Recours en annulation - fondé

JUDGMENT OF THE GENERAL COURT (Fourth Chamber)

16 September 2013 ( *1 )

‛Common foreign and security policy — Restrictive measures against Iran with the aim of preventing nuclear proliferation — Freezing of funds — Obligation to state reasons — Error of assessment’

In Case T‑489/10,

Islamic Republic of Iran Shipping Lines, established in Tehran (Iran), and the 17 other applicants whose names appear in the annex, represented by F. Randolph QC, M. Lester, Barrister, and M. Taher, Solicitor,

applicant,

v

Council of the European Union, represented by M. Bishop and R. Liudvinaviciute-Cordeiro, acting as Agents,

defendant,

supported by

European Commission, represented by M. Konstantinidis and T. Scharf, acting as Agents,

and by

French Republic, represented by G. de Bergues and É. Ranaivoson, acting as Agents,

interveners,

APPLICATION for annulment in part of Council Decision 2010/413/CFSP of 26 July 2010 concerning restrictive measures against Iran and repealing Common Position 2007/140/CFSP (OJ 2010 L 195, p. 39), of Council Implementing Regulation (EU) No 668/2010 of 26 July 2010 implementing Article 7(2) of Regulation (EC) No 423/2007 concerning restrictive measures against Iran (OJ 2010 L 195, p. 25), of Council Decision 2010/644/CFSP of 25 October 2010 amending Decision 2010/413 (OJ 2010 L 281, p. 81), of Council Regulation (EU) No 961/2010 of 25 October 2010 on restrictive measures against Iran and repealing Regulation (EC) No 423/2007 (OJ 2010 L 281, p. 1), and of Council Regulation (EU) No 267/2012 of 23 March 2012 concerning restrictive measures against Iran and repealing Regulation No 961/2010 (OJ 2012 L 88, p. 1),

THE GENERAL COURT (Fourth Chamber),

composed of I. Pelikánová (Rapporteur), President, K. Jürimäe and M. van der Woude, Judges,

Registrar: N. Rosner, Administrator,

having regard to the written procedure and further to the hearing on 23 April 2013,

gives the following

Judgment

Background to the dispute

1 The present case has been brought in connection with the restrictive measures introduced in order to apply pressure on the Islamic Republic of Iran to end proliferation-sensitive nuclear activities and the development of nuclear weapon delivery systems (‘nuclear proliferation’).

2 On 26 July 2010, the applicants, Islamic Republic of Iran Shipping Lines (‘IRISL’) and the 17 other applicants whose names appear in the annex, were placed on the list of entities involved in nuclear proliferation set out in Annex II to Council Decision 2010/413/CFSP of 26 July 2010 concerning restrictive measures against Iran and repealing Common Position 2007/140/CFSP (OJ 2010 L 195, p. 39).

3 Consequently, the applicants were entered on the list in Annex V to Council Regulation (EC) No 423/2007 of 19 April 2007 concerning restrictive measures against Iran (OJ 2007 L 103, p. 1) by means of Council Implementing Regulation (EU) No 668/2010 of 26 July 2010 implementing Article 7(2) of Regulation No 423/2007 (OJ 2010 L 195, p. 25). That listing resulted in the applicants’ funds and economic resources being frozen.

4 In Decision 2010/413, the Council of the European Union stated the following grounds in respect of IRISL: ‘IRISL has been involved in the shipment of military-related cargo, including proscribed cargo from Iran. Three such incidents involved clear violations that were reported to the [United Nations] Security Council Iran Sanctions Committee. IRISL’s connection to proliferation was such that the [United Nations Security Council] called on States to conduct inspections of IRISL vessels, provided there are reasonable grounds to believe that the vessel is transporting proscribed goods, in [United Nations Security Council Resolutions] 1803 and 1929.’

5 In addition, in the statement of reasons in Decision 2010/413 concerning IRISL Marine Services and Engineering Co., the Council stated that IRISL ‘[had] facilitated repeated violations of provisions of [United Nations Security Council Resolution] 1747’.

6 The other applicants were identified in Decision 2010/413, in essence, as companies owned or controlled by IRISL or acting on its behalf. Khazar Shipping Lines was also identified as a company which ‘[had] facilitated shipments involving UN- and US-designated entities, such as Bank Melli, by shipping cargo of proliferation concern from countries like Russia and Kazakhstan to Iran’.

7 The grounds set out in Implementing Regulation No 668/2010 in regard to the applicants are essentially the same as those set out in Decision 2010/413.

8 By letter of 25 August 2010, the applicants requested the Council to communicate to them the documents and evidence on the basis of which they had been included in the list in Annex II to Decision 2010/413 and in the list in Annex V to Regulation No 423/2007.

9 By letter of 13 September 2010, the Council replied, in particular, that the allegations against IRISL were described in the 2009 annual report of the Sanctions Committee of the United Nations Security Council (‘the Security Council’), a copy of which it enclosed.

10 By letter of 14 September 2010, the applicants requested further explanations and the evidence on which the Council had relied. The Council replied by letter of 20 September 2010, enclosing two proposals for the adoption of restrictive measures against IRISL and Khazar Shipping Lines submitted by Member States.

11 The applicants’ listing in Annex II to Decision 2010/413 was maintained by Council Decision 2010/644/CFSP of 25 October 2010 amending Decision 2010/413 (OJ 2010 L 281, p. 81). The reasons stated in regard to the applicants are identical to those set out in Decision 2010/413.

12 Since Regulation No 423/2007 was repealed by Council Regulation (EU) No 961/2010 of 25 October 2010 on restrictive measures against Iran (OJ 2010 L 281, p. 1), the applicants were included by the Council in Annex VIII to the latter regulation. Consequently, the applicants’ funds and economic resources were frozen pursuant to Article 16(2) of that regulation. The reasons stated in regard to the applicants are essentially the same as those set out in Decision 2010/413.

13 Since Regulation No 961/2010 was repealed by Council Regulation (EU) No 267/2012 of 23 March 2012 concerning restrictive measures against Iran (OJ 2012 L 88, p. 1) the applicants were included by the Council in Annex IX to the latter regulation. The reasons stated in regard to the applicants are essentially the same as those set out in Decision 2010/413. Consequently, the applicants’ funds and economic resources were frozen pursuant to Article 23(2) of that regulation.

Procedure and forms of order sought

14 By application lodged at the Court Registry on 8 October 2010 the applicants and Cisco Shipping Co. Ltd and IRISL Multimodal Transport Co. brought the present action.

15 By letter of 24 November 2010, Cisco Shipping and IRISL Multimodal Transport discontinued their action. By order of the Court (Fourth Chamber) of 8 December 2010 they were removed from the register as applicants in the present case and ordered to bear their own costs.

16 By document lodged at the Court Registry on 21 December 2010, the applicants amended their heads of claim following the adoption on 25 October 2010 of Decision 2010/644 and Regulation No 961/2010.

17 By documents lodged at the Court Registry on 14 and 22 March 2011, the European Commission and the French Republic applied to intervene in the present proceedings in support of the Council. By order of 10 May 2011, the President of the Fourth Chamber of the General Court granted them leave to intervene.

18 By document lodged at the Court Registry on 30 April 2012, the applicants amended their heads of claim following the adoption on 23 March 2012 of Regulation No 267/2012.

19 Upon hearing the report of the Judge-Rapporteur, the Court (Fourth Chamber) decided, on 12 March 2013, to open the oral procedure and, by way of measures of organisation of procedure provided for under Article 64 of the Rules of Procedure of the General Court, put questions to the parties and to the Council, which were requested to answer them at the hearing.

20 The parties presented oral argument and answered the written and oral questions put by the Court at the hearing on 23 April 2013.

21 The applicants claim that the Court should: — annul Decision 2010/413, Implementing Regulation No 668/2010, Decision 2010/644, Regulation No 961/2010 and Regulation No 267/2012, in so far as those measures concern the applicants; — order the Council to pay the costs.

22 The Council, supported by the Commission, contends that the Court should: — dismiss the action; — order the applicants to pay the costs.

23 The French Republic submits that the Court should dismiss the action.

Law

Substance

24 The applicants put forward five pleas in law. The first plea alleges breach of their rights of defence and of their right to effective judicial protection. The second plea alleges breach of the obligation to state reasons. The third plea alleges breach of the principle of proportionality, of their right to property and of their right to carry on an economic activity. The fourth plea alleges error of assessment as regards the adoption of restrictive measures against the applicants. The fifth plea alleges that Article 16(2) of Regulation No 961/2010 and Article 23(2) of...