Bringing Sanctions to Justice: EU Sanctions against Russia
Michelle Q Zang, Post-doc Research Fellow, PluriCourts
Sanctions against third countries, individuals or entities, are an essential EU policy tool to pursue objectives in accordance with principles of the Common Foreign and Security Policy. In general terms, the EU imposes restrictive measures to bring about a change in policy or activity by the target country, part of a country, government, entities or individuals. They are a preventive, non-punitive, instrument which should allow the EU to respond swiftly to political challenges and developments.
EU sanctions against Russia
In response to the Russia’s use of armed forces on Ukraine territory and its illegal annexation of Crimea and Sevastopol in 2014 and in the absence of de-escalatory steps by the Russian Federation, the EU imposed a series of sanctions by means of Council Decision and Council Regulation. Restrictive measures imposed so far include three categories of actions:
In March 2014, the EU imposed travel restrictions and asset freeze against persons responsible for actions that undermine or threaten the territorial integrity, sovereignty and independence of Ukraine.
In June, the EU enforced a number of restrictive measures on trade and investment in response to the illegal annexation of Crimea and Sevastopol, including prohibitions on imports of products into the EU, investment by Europeans or EU-based companies, tourism services provided from the EU, and exports of certain goods and technologies in selected industries.
In July, in view of Russia's actions destabilizing the situation in Ukraine and the gravity thereof, the EU further put in place measures targeting sectoral cooperation and exchanges with Russia. This pack of sanctions includes not only prohibition on exports of certain dual-use goods/technology and on certain services related to the supply of arms and military equipment; it also establishes limitations on certain technologies for the oil industry and those on access to the EU capital market for certain Russian financial institutions.
Are the EU sanctions legitimate and just?
So far, scholarship and public debate have mainly focused upon the effect, impact and effectiveness of the sanction measures mentioned above. However, the question to be raised here is: are these measures built upon and implemented with sufficient legitimacy and justice grounds? This legitimacy/justice-related question not only concerns compliance of these measures with the constitutional treaties of the EU, Charter on Fundamental Rights of the European Union, as well as certain legal principles of the EU law; it further raises concerns as regards the legality and validity in light of EU’s obligations under international law.
At the EU front, sanction measures have been a long-lasting subject of litigations in front of the General Court and the Court of Justice. There have been more than 130 judgements delivered so far with the most well-known example of the Kadi saga. Insofar as the Russia-related sanctions are concerned, there are currently 9 cases pending; and the major pleas in law range from lack of reasoning, violation of fundamental rights and due process, to infringement of principles of proportionality and non-discrimination. The most often claimed fundamental rights include, in particular, the rights of defense, the right to effective judicial review and the right to property. It is also argued that the measures taken are neither necessary nor proportionate in light of the objectives stated.
Is the EU breaking its WTO obligations?
Another interesting point is, in couple of cases, the applicant further claimed that the contested measures breach the obligations of the EU under the World Trade Organization (WTO) agreements and the Partnership and Cooperation between the European Community and the Russian Federation. Legal claims as such, compared with others based purely upon the EU acquis, further involve the question of direct effect/applicability of the international agreements invoked. At least for the WTO agreements, it would be astonishing if the EU Courts changed their long established position that the WTO agreements are not, in general, among the rules that individuals can invoke and claim their rights.
However, as a result of Russia’s accession to the WTO in 2012, more and more debate arises concerning the possibility to bring the EU sanctions to Geneva. Apparently, many measures imposed under EU sanction regime stands against the fundamental principles of the multilateral trading regime. It is argued challenges can be brought under both The General Agreement on Tariffs and Trade (GATT) and The General Agreement on Trade in Services, claiming violations of principle of non-discrimination, prohibition on export restriction and market access. As the claims for violation are fairly founded, the critical point, therefore, is whether the EU can justify its Russia-related sanctions as “security exception”, a carved-out exit for the WTO Members to deviate from their commitments.
For example, according to Article XXI (b) (iii) GATT, “Nothing in this Agreement shall be construed… to prevent any contracting party from taking any action which it considers necessary for the protection of its essential security interests…taken in time of war or other emergency in international relations”. Up to date, no WTO panels or the Appellate Body has delivered any rulings as regards the security exception clause; only in one un-adopted GATT report, United States – Trade Measures Affecting Nicaragua, the panel shed light on the issue of whether the use of security exception is completely subjective, or some objective conditions are actually required. On the one hand, as the text of Article XXI (b) (iii) GATT provides, the security exceptions cover the measures that the state “considers” necessary for its essential security interests; on the other hand, similar to the position of the Panel in United States – Trade Measures Affecting Nicaragua, if the interpretation of security exception was reserved entirely to the national state invoking it, e.g. the EU, how could we make sure that this clause is not invoked excessively or for purpose other than those set out in this provision?
As the story is still evolving on the track, we do not yet know exactly how much deficits would be eventually confirmed by the relevant adjudicators; what is certain, however, is that sanctions are not sovereignty behavior that can be shielded from challenges towards their justice.