EU Case Law

After the Yusuf and Kadi cases, another two cases entered in the CFI attention.Once again in the Ayadi and Hassan cases the CFI ruled that the fundamental rights of two terrorist suspects were not violated when EU Member States froze their assets.

Ireland and the UK froze the bank accounts of a Tunisian and Libyan national, respectively, after European Council Regulation 881/2002, which implemented several UN Security Council resolutions, authorized Member States to freeze the assets of persons suspected of affiliation with al-Qaeda, Osama bin Laden, or the Taliban. The two suspects, Chafiq Ayadi from Tunisia and the Libyan Faraj Hassan, petitioned the CFI to annul the regulation on the basis that the asset freezes offended their fundamental human rights.

In separate judgments in both the Ayadi and Hassan cases, the court held that under the circumstances, the regulation does not prevent the individuals concerned from leading a satisfactory personal, family, and social life, as the petitioners could still earn money.

The CFI also stressed that petitioners may request judicial review by national courts, rather than EU courts, when the national judiciary refuses to bring their petitions before the UN committee that determines sanctions against terror suspects.

In conclusion, the CFI held last year that the European Union can freeze the assets of suspected terrorists under its treaty powers.

Text of the CFI judgment in Ayadi
Text of the CFI judgment in Hassan

With the decisions from September 2005 in the Yusuf and Kadi cases, the Court of First Instance of the European Communities (CFI) refused to review the European Regulation 881/2002 that contains the list of individuals and entities whose assets must be frozen, due to suspected terrorist links. Regulation 881 had been adopted by the Council of the European Union to implement a resolution of the U.N. Security Council which had enacted since 1999 and that required Member States to freeze the assets of individuals and entities affiliated to the Taliban and Al Qaeda.

Yusuf, together with the company Al Barakaat and other individuals, filed a petition to the CFI in 2001, seeking the annulment of the Regulation according to Article 230 EC Treaty. They contended that the insertion of their names in the list was inaccurate, and, moreover, that the mechanism of the insertion itself breached their fundamental rights. The CFI held that Regulation 881 and the list may not be challenged, because they derive from the U.N. Security Council determinations which bind Member States according to the U.N. Charter. Therefore, they cannot be impugned even when translated into European norms, unless they violate jus cogens. (As well known, jus cogens comprends all those norms which cannot be derogated by international agreements.)

In this case, however, the CFI found that such a measure falls outside the scope of judicial review and does not infringe the universally recognised human rights of the person (jus cogens): the right to respect for property and the right to a fair hearing. The right to judicial review, even if is one of the fundamental rights contemplated by the jus cogens, can be derogated for reasons of international peace and security.

In conclusion the CFI ruled that the EU has competence to order the freezing of individuals’ funds in the context of the battle against international terrorism.

Text of the CFI judgment in Yusuf
Text of the CFI judgment in Kadi