On 26 March, the CJEU (Grand Chamber) delivered a judgment dismissing the appeals brought by five of the leading businessmen operating in Russia (Pumpyanskiy, Khudaverdyan, Rashnikov, Mazepin and Khan; joined cases C-696/23 P, C-704/23 P, C-711/23 P, C-35/24 P and C-111/24 P). They were individuals sanctioned by the European Union with a prohibition on entering and transiting through the territory of the Member States, the freezing of their assets, and a prohibition on making funds or economic resources available to them. Each brought an action before the General Court seeking the annulment of the sanctions affecting them, but following the General Court’s decisions dismissing their actions, they lodged cassation appeals, which have given rise to the judgment to which we now refer.
The judgment essentially addresses three issues. First, it interprets the concept of leading businesspersons involved in economic sectors that provide the Russian Government with a substantial source of revenue; in this regard, the CJEU states that, for the listing criterion to apply, it is the “economic sectors” that must provide such a substantial source of revenue to the Government, and not the leading businesspersons involved in those sectors.
Second, the CJEU clarifies the notion of “influence” of businesspersons, holding that it must be assessed in light of the economic context in which they operate, without it being necessary for them to maintain links with the Russian Government. In other words, these are influential businesspersons by virtue of their importance within the Russian economy, which places them in a position to facilitate the financing of Russia’s actions in respect of Ukraine, insofar as they contribute to the profitability of those “economic sectors”.
Finally, the CJEU reiterates its established case-law that only the manifestly inappropriate nature of a sanctions criterion may give rise to its potential illegality, “manifestly inappropriate” being understood to mean that the criterion is in no way capable of achieving the objectives pursued by the measure. Accordingly, it is not unlawful to sanction the category of businesspersons referred to above, since targeting leading businesspersons involved in economic sectors that provide the Russian Government with a substantial source of revenue increases pressure on Russia and raises the economic cost of its actions in respect of Ukraine.
With the collaboration of José Luis Iriarte, Professor of Private International Law at the Universidad Pública de Navarra.
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