JUDGMENT OF THE GENERAL COURT (Fourth Chamber)
8 July 2020 (*) (1)
(Common foreign and security policy — Restrictive measures adopted against Syria — Freezing of funds — Error of assessment)
In Case T‑186/19,
Khaled Zubedi, residing in Damascus, Syria, represented by M. Lester QC, and M. O’Kane, Solicitor,
applicant,
v
Council of the European Union, represented by V. Piessevaux and A. Limonet, acting as Agents,
defendant,
APPLICATION pursuant to Article 263 TFEU seeking the annulment of Council Implementing Decision (CFSP) 2019/87 of 21 January 2019 implementing Decision 2013/255/CFSP concerning restrictive measures against Syria (OJ 2019 L 18 I, p. 13) and of Council Implementing Regulation (EU) 2019/85 of 21 January 2019 implementing Regulation (EU) No 36/2012 concerning restrictive measures in view of the situation in Syria (OJ 2019 L 18 I, p. 4), in so far as those measures relate to the applicant.
THE GENERAL COURT (Fourth Chamber),
composed of S. Gervasoni, President, L. Madise and J. Martín y Pérez de Nanclares (Rapporteur), Judges,
Registrar: E. Coulon,
gives the following
Judgment
Background to the dispute
1 The applicant, Mr Khaled Zubedi, is a Syrian businessperson who is engaged in business in the real estate sector.
2 Strongly condemning the violent repression of peaceful demonstrations in Syria and appealing to the Syrian authorities to refrain from resorting to force, the Council of the European Union adopted, pursuant to Article 29 TEU, Decision 2011/273/CFSP of 9 May 2011 concerning restrictive measures against Syria (OJ 2011 L 121, p. 11). In view of the seriousness of the situation, the Council imposed an arms embargo, a ban on exports of material which might be used for internal repression, restrictions on admission to the European Union, and the freezing of funds and economic resources of certain persons and entities responsible for the violent repression against the civilian population in Syria.
3 The names of the persons responsible for the violent repression against the civilian population in Syria and those of the natural or legal persons and entities associated with them are mentioned in the Annex to Decision 2011/273. Under Article 5(1) of that decision, the Council, acting upon a proposal by a Member State or the High Representative of the Union for Foreign Affairs and Security Policy, may amend the Annex. The name of the applicant was not included in that annex at the time the decision was adopted.
4 Since some of the restrictive measures against the Syrian Arab Republic fall within the scope of the FEU Treaty, the Council adopted, on the basis of Article 215(2) TFEU, Regulation (EU) No 442/2011 of 9 May 2011 concerning restrictive measures in view of the situation in Syria (OJ 2011 L 121, p. 1). That regulation is largely identical to Decision 2011/273, but provides for the possibility of frozen funds being released. The list of persons, entities and bodies recognised as being responsible for the repression in question or as being associated with those responsible, set out in Annex II to that regulation, is identical to the list appearing in the annex to Decision 2011/273. Under Article 14(1) and (4) of Regulation No 442/2011, where the Council decides to subject a natural or legal person or an entity or body to the restrictive measures referred to, it is required to amend Annex II accordingly and also review the list at regular intervals, at least every 12 months.
5 By Decision 2011/782/CFSP of 1 December 2011 concerning restrictive measures against Syria and repealing Decision 2011/273 (OJ 2011 L 319, p. 56), the Council considered it necessary to impose additional restrictive measures in view of the gravity of the situation in Syria. For the sake of clarity, the measures imposed by Decision 2011/273 and the additional measures were incorporated into a single legal instrument. Decision 2011/782 provides, in Article 18, for restrictions on admission to the territory of the European Union and, in Article 19, for the funds and economic resources of the persons and entities whose names are listed in Annex I to the decision to be frozen.
6 Regulation No 442/2011 was replaced by Council Regulation (EU) No 36/2012 of 18 January 2012 concerning restrictive measures in view of the situation in Syria and repealing Regulation No 442/2011 (OJ 2012 L 16, p. 1).
7 Decision 2011/782 was replaced by Council Decision 2012/739/CFSP of 29 November 2012 concerning restrictive measures against Syria and repealing Decision 2011/782 (OJ 2012 L 330, p. 21), which in turn was replaced by Council Decision 2013/255/CFSP of 31 May 2013 concerning restrictive measures against Syria (OJ 2013 L 147, p. 14).
8 On 12 October 2015 the Council adopted Decision (CFSP) 2015/1836 amending Decision 2013/255 (OJ 2015 L 266, p. 75). On the same day, it adopted Regulation (EU) 2015/1828 amending Regulation No 36/2012 (OJ 2015 L 266, p. 1).
9 Recital 6 of Decision 2015/1836 states that ‘the Council has assessed that because of the close control exercised over the economy by the Syrian regime, an inner cadre of leading businesspersons operating in Syria is only able to maintain its status by enjoying a close association with, and the support of, the regime, and by having influence within it. The Council considers that it should provide for restrictive measures to impose restrictions on admission and to freeze all funds and economic resources belonging to, owned, held or controlled by those leading businesspersons operating in Syria, as identified by the Council and listed in Annex I, in order to prevent them from providing material or financial support to the regime and, through their influence, to increase pressure on the regime itself to change its policies of repression’.
10 The wording of Articles 27 and 28 of Decision 2013/255 was amended by Decision 2015/1836. Those articles now provide for restrictions on the entry into, or transit through, the territories of the Member States and for the funds of ‘leading businesspersons operating in Syria’ to be frozen, unless there is ‘sufficient information that [those persons] are not, or are no longer, associated with the regime or do not exercise influence over it or do not pose a real risk of circumvention’.
11 By Council Implementing Decision (CFSP) 2019/87 of 21 January 2019 implementing Decision 2013/255 (OJ 2019 L 18 I, p. 13), and by Council Implementing Regulation (EU) 2019/85 of 21 January 2019 implementing Regulation No 36/2012 (OJ 2019 L 18 I, p. 4) (together, ‘the contested acts’), the applicant’s name was inserted at line 271 of Table A of the lists of persons, entities and bodies subject to the restrictive measures set out in Annex I to Decision 2013/255 and in Annex II to Regulation No 36/2012 (together, ‘the lists in question’).
12 In the contested acts, the Council justified the adoption of the restrictive measures against the applicant by identifying him as the ‘co-owner of Zub[e]di and [Kalai] LLC, Director of Agar Investment Company, General Manager of Al Zub[e]di company and Al Zub[e]di & Al Taweet Contracting Company, Director and Owner of Zub[e]di Development Company, and co-owner of Enjaz Investment Company’, giving the following reasons:
‘Leading businessperson operating in Syria, with significant investments in the construction industry, including a 50% stake in Zub[e]di and [Kalai] LLC, which is constructing the luxury tourist city Grand Town and to which the regime has granted a 45-year agreement in return for 19-21% of its revenue. In this capacity he is linked to Nader [Kalai]. Khaled al-Zub[e]di benefits from and/or supports the regime through his business activities, in particular through this stake in the Grand Town development.’
13 On 22 January 2019, the Council published in the Official Journal of the European Union a Notice for the attention of the persons subject to the restrictive measures provided for in Decision 2013/255 and in Regulation No 36/2012 (OJ 2019 C 27, p. 3).
14 By letter of 1 March 2019, the applicant’s representatives objected to the inclusion of the applicant’s name on the lists in question and asked the Council to provide them with the documents supporting the inclusion of his name.
15 By letter of 21 March 2019, the Council informed the applicant’s representatives that, in essence, their observations were not capable of calling into question the decision to include the applicant’s name on the lists in question. The Council also provided them with the document bearing the reference WK 51/2019 INIT, of 10 January 2019, containing the evidence supporting the reasons for the inclusion of the applicant’s name.
Procedure and forms of order sought
16 By application lodged at the Court Registry on 29 March 2019, the applicant brought the present action.
17 On 4 July 2019, the Council lodged its defence at the Court Registry.
18 By letter of 8 July 2019, the statement of defence was served on the applicant, who was informed that the time limit for the lodging of the reply was 21 August 2019. By letter of 16 August 2019, the applicant requested an extension of the time limit for lodging the reply, which was refused by letter of 19 August 2019. The applicant did not lodge a reply within the prescribed period.
19 By letter of 4 September 2019, the parties were informed that the written part of the procedure had been closed and that they could request that a hearing be held under the conditions set out in Article 106 of the Rules of Procedure of the General Court. The parties did not make such a request within the period prescribed under those provisions, which expired on 7 October 2019.
20 By way of measures of organisation of procedure provided for in Article 89(3)(a) and (d) of the Rules of Procedure, on 24 January 2020, the Court requested that the Council answer a number of questions and to produce legible versions of certain documents. The Council answered the questions and complied with the request for production of documents within the period allowed.
21 When invited to comment on the Council’s responses, the applicant did not reply within the time limit set.
22 The applicant claims that the Court should:
– annul the contested acts in so far as they concern him;
– order the Council to pay the costs of the proceedings.
23 The Council contends that the Court should:
– dismiss the action in its entirety;
– order the applicant to pay the costs;
– in the alternative, should the Court annul the contested measures in so far as they concern the applicant, order that the effects of Implementing Decision 2019/87 be maintained as regards the applicant until the partial annulment of Implementing Regulation 2019/85 takes effect.
Law
24 In support of the action, the applicant relies on a single plea, alleging an error of law. This plea in law comprises three complaints.
25 By the first complaint, the applicant does not dispute that he is a businessperson operating in Syria, but maintains that he is not a ‘leading’ businessperson, since he does not make significant profits. In any event, he argues that the mere fact of being a businessperson is an insufficient basis for the inclusion of his name on the lists in question and that the Council should have been required to show that he was associated with the leadership of the Syrian regime, which is not the case.
26 By the second complaint, while the applicant acknowledges that he is connected to Mr Nader Kalai because they both hold shares in Zubedi and Kalai LLC, he claims that the Council did not explain how that relationship is relevant for the purposes of justifying the inclusion of his name on the lists in question. In any event, in his view, that link is not capable of justifying the listing of his name.
27 By the third complaint, the applicant denies, in essence, that he has links with the Syrian regime and maintains that the Council has not adduced any prima facie evidence to establish the existence of such links.
28 The Council disputes the applicant’s arguments.
29 As a preliminary point, it should be noted that the effectiveness of the judicial review guaranteed by Article 47 of the Charter of Fundamental Rights of the European Union requires, in particular, that the Courts of the European Union are to ensure that the decision by which restrictive measures were adopted or maintained, which affects the person or entity concerned individually, is taken on a sufficiently solid factual basis. That entails a verification of the factual allegations in the summary of reasons underpinning that decision, with the consequence that judicial review cannot be restricted to an assessment of the cogency in the abstract of the reasons relied on, but must concern whether those reasons, or, at the very least, one of those reasons, deemed sufficient in itself to support that decision, is substantiated (judgment of 18 July 2013, Commission and Others v Kadi, C‑584/10 P, C‑593/10 P and C‑595/10 P, EU:C:2013:518, paragraph 119).
30 To that end, it is for the Courts of the European Union, in order to carry out that examination, to request the competent European Union authority, when necessary, to produce information or evidence, confidential or not, relevant to such an examination (see judgment of 18 July 2013, Commission and Others v Kadi, C‑584/10 P, C‑593/10 P and C‑595/10 P, EU:C:2013:518, paragraph 120).
31 That is because it is the task of the competent EU authority to establish, in the event of a challenge, that the reasons relied on against the person or entity concerned are well founded, and not the task of that person or entity to adduce evidence of the negative, namely that those reasons are not well founded (judgment of 18 July 2013, Commission and Others v Kadi, C‑584/10 P, C‑593/10 P and C‑595/10 P, EU:C:2013:518, paragraph 121).
32 For that purpose, there is no requirement that that authority produce before the Courts of the European Union all the information and evidence underlying the reasons alleged in the act sought to be annulled. It is, however, necessary that the information or evidence produced should support the reasons relied on against the person or entity concerned (judgment of 18 July 2013, Commission and Others v Kadi, C‑584/10 P, C‑593/10 P and C‑595/10 P, EU:C:2013:518, paragraph 122).
33 If the competent European Union authority provides relevant information or evidence, the Courts of the European Union must then determine whether the facts alleged are made out in the light of that information or evidence and assess the probative value of that information or evidence in the circumstances of the particular case and in the light of any observations submitted in relation to them by, among others, the person or entity concerned (judgment of 18 July 2013, Commission and Others v Kadi, C‑584/10 P, C‑593/10 P and C‑595/10 P, EU:C:2013:518, paragraph 124).
34 Pursuant to the case-law of the Court of Justice, whether a listing is well founded must be determined by examining the evidence, not in isolation, but in its context (see, to this effect, judgments of 21 April 2015, Anbouba v Council, C‑630/13 P, EU:C:2015:247, paragraph 51, and of 21 April 2015, Anbouba v Council, C-605/13 P, EU:C:2015:248, paragraph 50).
35 Lastly, in this instance, in carrying out an assessment of the importance of what was at stake, which forms part of the review of the proportionality of the restrictive measures at issue, account may be taken of the context of those measures, of the fact that there was an urgent need to adopt such measures in order to put pressure on the Syrian regime to stop the violent repression against the population, and of the difficulty in obtaining more specific evidence in a State beset by civil war and an authoritarian regime (see judgment of 21 April 2015, Anbouba v Council, C‑605/13 P, EU:C:2015:248, paragraph 46).
36 It should be noted that the general listing criteria set out in Articles 27(1) and 28(1) of Decision 2013/255, which are reproduced, as regards the freezing of funds, in Article 15(1)(a) of Regulation No 36/2012, provide that persons and entities benefiting from or supporting the Syrian regime are to be subject to restrictive measures. Similarly, Article 27(2)(a) and (3) and Article 28(2)(a) and (3) of that decision, which are reproduced, as regards the freezing of funds, in Article 15(1a)(a) and (1b) of that regulation, provide that the category of ‘leading businesspersons operating in Syria’ is to be subject to restrictive measures, unless there is sufficient information that they are not, or are no longer, associated with the regime or do not exercise influence over it or do not pose a real risk of circumvention.
37 In addition, as mentioned in paragraph 12 above, the grounds for including the applicant’s name on the lists in question are worded as follows:
‘Leading businessperson operating in Syria, with significant investments in the construction industry, including a 50% stake in Zub[e]di and [Kalai] LLC, which is constructing the luxury tourist city Grand Town and to which the regime has granted a 45-year agreement in return for 19-21% of its revenue. In this capacity he is linked to Nader [Kalai]. Khaled al-Zub[e]di benefits from and/or supports the regime through his business activities, in particular through this stake in the Grand Town development.’
38 It follows that the complainant’s name was included in the lists in question on account of, first, his status as a leading businessperson operating in Syria and, secondly, his association with the Syrian regime.
39 In other words, the listing of the applicant’s name is based, first, on the criterion laid down in Article 27(2)(a) and Article 28(2)(a) of Decision 2013/255 and in Article 15(1a)(a) of Regulation No 36/2012 (criterion of a leading businessperson operating in Syria) and, second, on the criterion laid down in Article 27(1) and Article 28(1) of that decision and in Article 15(1)(a) of that regulation (criterion of association with the regime).
40 It is in the light of those considerations that it is appropriate to examine the single plea raised by the applicant and, first of all, the first complaint, which seeks, in essence, to call into question the first ground for listing, namely that the applicant is a leading businessperson operating in Syria.
41 In that regard, it should be noted that the applicant acknowledges that he is a businessperson, but denies that he is a ‘leading’ businessperson and, as such, belongs to a ‘an inner cadre of leading businesspersons operating in Syria’.
42 As recalled in paragraph 12 above, the Council identified the applicant in the contested acts as the ‘co-owner of Zub[e]di and [Kalai] LLC, Director of Agar Investment Company, General Manager of Al Zub[e]di company and Al Zub[e]di & Al Taweet Contracting Company, Director and Owner of Zub[e]di Development Company, and co-owner of Enjaz Investment Company’.
43 In order to justify the inclusion of the applicant’s name on the lists in question, the Council provided the document bearing the reference WK 51/2019 INIT, of 10 January 2019, containing publicly available information, namely links to websites, press articles and screenshots from:
– the ‘aliqtisadi News’ website, which, on a page accessed on 8 October 2018, describes the applicant as the director and owner of the Zubedi Development Company, director and owner of 50% of the shares of Enjaz Investment Company, director of Agar Investment Company, general manager of Al Zubedi Company and Al Zubedi & Al Taweet Contracting Company, and states, in an article of 31 May 2018, that the applicant is to implement the ‘Grand Town’ project, described as a tourist city comprising villas, residential buildings and shopping centres, as well as the construction of a residential town, and that he is the owner of Agar Investment Company, for which Zubedi Development Company provides 65% of the capital;
– the ‘Al-Rustom Law Office’ website, which, on a page accessed on 8 October 2018, describes the applicant as the founder of the Zubedi Development Company;
– the website of ‘The Syria Report’, which states, first, on a page accessed on 4 October 2018, that the applicant owns 50% of the company Zubedi and Kalai, secondly, in an article of 7 March 2017, that that company owns 40% of a public-private real estate development company with capital of 50 billion Syrian pounds (SYP) or 92 million United States dollars (USD), with the other partners being the State-owned General Housing Establishment and Real Estate Bank, a public sector company, and, thirdly, in an article of 21 March 2017, that the company Zubedi and Kalai will manage the Ebla Hotel under an agreement approved by the Syrian regime, involving an investment of USD 25 million, and that that company has signed an agreement with the government to develop an area of 800 000 square metres around the hotel, including the construction of villas and other facilities, with that agreement due to remain in place for 45 years and the regime to receive 19% of the revenue for the first five years and 21% thereafter;
– the ‘Eqstad News’ website, which reports, in an article of 9 September 2018, that the applicant is working with the Syrian regime on the ‘Grand Town’ project, described as a tourist development project, including villas and residential buildings as well as shopping centres, and that the applicant hosted a dinner with the Prime Minister and other Syrian ministers;
– the ‘ATHR Press News’ website, which mentions, in an article of 27 September 2018, the ‘Grand Town’ project, in which the applicant and the Ministry of Tourism are participating, and the fact that the applicant is the General Manager of Ibdaa Co. LLC and the Zubedi Development Company;
– the website of the Zubedi and Kalai company, accessed on 5 and 8 October 2018, which describes the various aspects of the real estate project surrounding the Ebla Hotel, namely the construction of luxury villas, three and four-star hotels, a water park and a shopping centre; this site also refers to the size of the ‘Grand Town’ project as well as the ‘EBDA’A Al Ghasula’ residential project, which is also due to include various social facilities, such as a hospital, a school and a shopping centre;
– the Youtube channel of ‘ZK Grand Town’, accessed on 5 October 2018, with videos detailing the many facilities of the ‘Grand Town’ project, such as a golf course, luxury villas, multiple hotels, a shopping centre and an amusement park;
– the ‘Shaam Times News’ website, which, in an article of late September 2018, describes the applicant as the managing director of the Ibdaa Co. company, which employs 650 people, and of the Zubedi Development Company, and states that the ‘Grand Town’ project will begin in October 2018. According to that article, the applicant stated, inter alia, that the ‘Grand Town’ project was a partnership with the Syrian State, represented by the Ministries of Economy and Tourism and the City of Exhibitions, that the project was part of the reconstruction strategy of the Syrian State and was not a personal project, but the project of an entire country, and that it was important that it should be supported by the government in order to gain the confidence of investors;
– the ‘Open Democracy’ website, which, in an article of 5 September 2017, refers to links between the applicant and the regime;
– of the ‘11.11.11’ website, which, in a report entitled ‘Syria: Reconstruction calling?’ of 28 March 2018, refers to the reconstruction strategy of the Syrian Government involving a number of businesspersons, including the applicant;
– of the ‘Brookings Institution’ website, which published a report in June 2018 entitled ‘Beyond Fragility: Syria and the challenges of reconstruction in fierce states’ which makes reference to the legislative acts adopted by the Syrian regime in order to enable certain businesspersons to benefit from expropriated land. The applicant is said to be closely linked to the ‘Assad regime’ and a participant in the ‘Marouta City’ project.
44 In the first place, the applicant claims that the Council has failed to identify which parts of the evidence that it has produced are supposed to support each of the grounds put forward to justify the inclusion of his name on the lists in question.
45 In that regard, it is sufficient to note that the only obligation on the Council is to ensure respect for the rights of the defence and the right to effective judicial protection by disclosing to the individual concerned the evidence against that person available to the Council and relied on as the basis of its decision, so that that individual is in a position to defend his rights in the best possible conditions and to decide, with full knowledge of the relevant facts, whether there is any point in bringing an action before the Courts of the European Union (see, to that effect, judgments of 18 July 2013, Commission and Others v Kadi, C‑584/10 P, C‑593/10 P and C‑595/10 P, EU:C:2013:518, paragraph 111, and of 12 December 2006, Organisation des Modjahedines du peuple d’Iran v Council, T‑228/02, EU:T:2006:384, paragraph 93).
46 Accordingly, there is no provision for, and the Council cannot be required to, carry out the identification sought by the applicant. In any event, the applicant in no way claims that it was not possible for him to identify the various items of evidence himself, owing to, for example, insurmountable practical difficulties encountered in reading the evidence disclosed to him by the Council, or that his rights of defence were therefore infringed.
47 In the second place, the applicant claims that the evidence submitted by the Council consists essentially of reports based on rumours from non-independent third parties and press articles.
48 It should be noted that, pursuant to settled case-law, the activity of the Court of Justice and of the General Court is governed by the principle of the unfettered evaluation of evidence, and that it is only the reliability of the evidence furnished which is decisive when it comes to the assessment of its value. In addition, when evaluating the probative value of a document, it is necessary to have regard to the credibility of the information which it contained, to bear in mind, in particular, the person from whom the document originated, the circumstances in which it had come into being and the person to whom it was addressed and whether, on its face, the document appears to be sound and reliable (see, to that effect, judgment of 27 September 2012, Shell Petroleum and Others v Commission, T‑343/06, EU:T:2012:478, paragraph 161 and the case-law cited).
49 In the present case, first, the applicant has not identified the reports concerned, the rumours on which they are based or the non-independent third parties who wrote them, those reports constituting the bulk of the evidence submitted by the Council.
50 Secondly, with regard to the press articles, the material whose probative force is disputed by the applicant come from digital sources of information of various origins, not only local, such as ‘The Syria Report’, the leading source of economic, business and financial information on Syria, and ‘aliqtisadi News’, one of the top 10 websites dedicated to Middle Eastern business, ‘Al-Rustom Law Office’, ‘Shaam Times News’, a Syrian opposition media outlet whose articles are picked up by a large number of international media outlets, but also foreign, such as ‘Open Democracy’, a political website based in the United Kingdom which seeks to encourage democratic debate throughout the world, ‘11.11.11’ and ‘Brookings Institution’, a renowned think tank in the United States. In addition, the Council submitted extracts from the website of the company Zubedi and Kalai, owned by the applicant, amongst others. Those various sources relay items of information that corroborate each other and therefore, in the absence of anything in the file which might call into question the reliability of those sources, the Court considers that that information must be regarded as sound and reliable within the meaning of the case-law referred to in paragraph 48 above.
51 In the third place, it is necessary to verify whether the whole body of evidence submitted by the Council constitutes a set of indicia sufficiently specific, precise and consistent to support the first ground for listing.
52 First, it is apparent from the information taken from the ‘aliqtisadi News’, ‘Al-Rustom Law Office’, ‘The Syria Report’, ‘ATHR Press News’ and ‘Shaam Times News’ websites that the applicant is the co-owner of the company Zubedi and Kalai, the director of Agar Investment Company, the director and owner of Zubedi Development Company and the co-owner of Enjaz Investment Company, which is either not disputed by the applicant or is confirmed both in the application and by the evidence he has produced. Thus, the applicant has provided a certificate issued by the Commercial Registry of the Ministry of Internal Trade and Consumer Protection of Syria, of 7 February 2019, stating that the company Zubedi and Kalai has been registered since 8 February 2016 and that he is the co-owner.
53 Secondly, the evidence adduced by the Council from the ‘ATHR Press News’ and ‘Shaam Times News’ websites shows that the applicant is a partner in the Ibdaa Co. company and that evidence suggests that this company is involved in the ‘Grand Town’ project, built on land owned by the Syrian Ministry of Tourism. That information was confirmed by the applicant’s own statements in the application and by documents provided by him. In that regard, the applicant produced a certificate issued by the Commercial Registry of the Ministry of Internal Trade and Consumer Protection of Syria, of 20 February 2019, stating that the company has been registered since 27 December 2009 and that he is a partner of that company through the company Zubedi and Kalai. He also produced two information letters from the Syrian Deputy Minister of Tourism, of 24 February and 25 March 2019, confirming that those companies are collaborating in the said project, which is being undertaken on land owned by the Syrian Ministry of Tourism.
54 Thirdly, it follows from the extracts from the ‘aliqtisadi News’, ‘The Syria Report’, ‘Eqstad News’, ‘ATHR Press News’ and ‘Shaam Times News’ websites, as well as from the website of the Zubedi and Kalai company and its Youtube channel, that the applicant is involved in major residential construction projects in the Damascus region, as evidenced not only by the ‘EBDA’A Al Ghasula’ project and the fact that he owns 40% of the shares in a public-private real estate development company but also, especially, by the ‘Grand Town’ project.
55 More specifically, as regards the ‘Grand Town’ project, mentioned in the grounds for including the applicant’s name on the lists in question, it is clear from the evidence adduced by the Council that that project, in which the applicant participates, in particular through the Zubedi and Kalai company, of which he is co-owner, is a large scale project, since it involves, inter alia, the construction of hotel complexes, residential buildings, amusement and water parks, a golf course and a shopping centre.
56 The applicant does not contest any of that information. In that respect, he says he is participating in the realisation of the ‘Grand Town’ project, which he describes as ‘a lifelong dream’, and he even confirms his involvement in that project not only in his arguments but also in the documents he has produced. He states that he has acquired a large amount of land in the area, a claim corroborated by a statement by the Syrian Ministry of Local Administration and Environment of 10 February 2019, which he is using to develop the area. In addition, he himself has produced the contract concluded on 16 March 2017 between the Zubedi and Kalai company and the Syrian Ministry of Tourism for, among other things, the operation of the Ebla Hotel, which is part of that project. Finally, he states that he has financed, with his own funds, various construction projects, including the project in question.
57 On the other hand, the applicant asserts that the regime has no stake in the ‘Grand Town’ project and that there is no 45-year contract with respect to that project. Although that argument is raised in the applicant’s third complaint, it should be considered in connection with the first complaint. In essence, it seeks to call into question the terms of the first ground for listing, which is based, inter alia, on the fact that the applicant participates in that project through the company Zubedi and Kalai.
58 Nevertheless, that assertion is contradicted by the applicant himself, since he points out that part of the ‘Grand Town’ project is to be undertaken on land belonging to the Syrian Ministry of Tourism and that that part was the subject of a contract concluded on 16 March 2017 under which it was agreed that that ministry should receive part of the income generated, in particular, from the operation of the Ebla Hotel. Thus, even if it were to be accepted that the Syrian regime, through that ministry, may receive revenue only for part of the project and not the entire project, that nonetheless confirms that the Syrian regime is a significant participant in the project. As to the estimated duration of that contract, the applicant submits that it will, in any event, be 30 years and therefore, even if the Council’s assumption that the contract was for 45 years was incorrect, the fact remains that the project in question is intended to last for a significant amount of time. In any event, it is clear from the clauses of that contract, in particular clauses 13 and 15, that it is indeed intended to apply for 45 years.
59 Therefore, it follows from all the evidence submitted by the Council that the applicant is indeed involved in various large construction projects, holds significant shareholdings and plays a role in a number of companies. In particular, the justification for the first ground for listing, namely that the applicant is a leading businessperson as he has made significant investments in the construction industry, including a 50% shareholding in Zubedi and Kalai, which is constructing the luxury tourist city ‘Grand Town’ and with which the regime entered into a 45-year agreement in exchange for 19 to 21% of its revenue, is corroborated in its entirety by the evidence submitted by the Council.
60 Far from calling into question the various findings made in the light of the evidence produced by the Council, through his observations and documents, the applicant has largely confirmed them, as is apparent from paragraphs 53 to 58 above. In that regard, it should also be pointed out that the reference to the link between the applicant and Mr Nader Kalai is not an independent ground for listing, contrary to what the applicant stated in the second complaint, but a clarification made in connection with the first complaint, which is not only apparent from the evidence adduced by the Council, but has also been confirmed by the applicant.
61 Therefore, it must be concluded that the Council has presented a precise and consistent set of indicia capable of demonstrating that the applicant is a leading businessperson operating in Syria.
62 That conclusion cannot be called into question by the other arguments put forward by the applicant.
63 First of all, the applicant disputes that he is the managing director of Al Zubedi Company and Al Zubedi & Al Taweet Contracting Company and claims that he is not aware of their existence. It is true that only one of the documents produced by the Council mentions the existence of those entities, which is not sufficient to confirm that claim. Nevertheless, even if the Council was incorrect to take the view that the applicant is the managing director of those entities, the remaining evidence is sufficient to maintain the conclusion that the applicant is a leading businessperson operating in Syria.
64 Secondly, the applicant submits that he cannot be regarded as a leading businessperson because he does not make large profits. That argument must be rejected. It should be noted, as observed by the Council, that neither Articles 27 or 28 of Decision 2013/255 nor Article 15 of Regulation No 36/2012 require the person concerned to make large profits in order to meet the criterion for being listed as a ‘leading businessperson operating in Syria’. The reference made in recital 1 of Implementing Decision 2019/87 and in recital 2 of Implementing Regulation 2019/85 to ‘large profits’ made by leading businesspersons cannot be regarded as establishing a condition that the Council must demonstrate has been fulfilled in order to apply the listing criterion laid down in Article 27(2)(a) and Article 28(2)(a) of that decision and in Article 15(1a)(a) of that regulation.
65 In any event, not only has the applicant failed to support his contention with any concrete evidence, but also, above all, the mere fact that he was able, according to his own assertions, to finance various construction projects, including the ‘Grand Town’ project, with his own funds, and the fact that he employs several hundred employees whose social security contributions he allegedly pays himself, necessarily implies that some of his activities enable him to generate sufficient, if not substantial, profits to finance his various projects and pay his employees in present-day Syria.
66 Lastly, the applicant submits, in essence, that the Council was required to demonstrate that there is a link between him and the Syrian regime.
67 In that regard, it should be pointed out that the case-law on which the applicant relies was delivered in a different legislative context from that at the time the contested acts were adopted. In particular, the judgment of 21 April 2015, Anbouba v Council (C‑605/13 P, EU:C:2015:248, paragraph 52), which required the Council to bring before the Courts of the European Union a set of sufficiently precise and consistent indicia to establish that there is a sufficient link between the person subject to a measure freezing his funds and the regime concerned, related to a specific legislative context, namely that established by Decision 2013/255 before it was amended in 2015 by Decision 2015/1836, in which the only criteria for the inclusion of a person’s name on the lists in question were, precisely, close links with, support for and/or benefit from the Syrian regime.
68 However, in the present case, the applicant’s name was included on the lists in question in the legislative context of Decision 2013/255, as amended by Decision 2015/1836. In that respect, Decision 2015/1836 introduced, inter alia, as an objective, autonomous and sufficient listing criterion, that of ‘leading businessperson operating in Syria’, with the result that the Council is no longer required to demonstrate that there is a link between that category of persons and the Syrian regime, or between that category of persons and the support provided to, or the benefit derived from, the regime, since being a leading businessperson operating in Syria is sufficient for the restrictive measures in question to be applied to a person (see, to that effect, judgments of 11 September 2019, HX v Council, C‑540/18 P, not published, EU:C:2019:707, paragraph 38; of 4 April 2019, Sharif v Council, T‑5/17, EU:T:2019:216, paragraphs 55 and 56 (not published); and order of 11 September 2019, Haswani v Council, T‑231/15 RENV, not published, EU:T:2019:589, paragraph 56).
69 In that regard, the General Court has found that it is possible to infer from the criterion relating to the category of ‘leading businesspersons operating in Syria’ a rebuttable presumption that such persons are associated with the Syrian regime (see, to that effect, judgment of 4 April 2019, Sharif v Council, T‑5/17, EU:T:2019:216, paragraph 106, and order of 11 September 2019, Haswani v Council, T‑231/15 RENV, not published, EU:T:2019:589, paragraph 60). That presumption applies where the Council is able to demonstrate that the person is not only a businessperson operating in Syria, but also that he or she can be described as ‘leading’. As is apparent from the express terms of recital 6 of Decision 2015/1836 and as mentioned in paragraph 9 above, it is the influence that that category of persons is likely to exert over the Syrian regime that the Council aims to exploit by pushing them, through the restrictive measures it adopts against them, to put pressure on the Syrian regime to change its policy of repression. Thus, once the Council has established the influence that a businessperson is capable of exerting over the Syrian regime, there is presumed to be a link between that person and the Syrian regime.
70 In addition, it should be noted that compliance, by the General Court, with the rules relating to the burden of proof and the taking of evidence as regards restrictive measures require the General Court to comply with the principle established in the case-law referred to in paragraph 31 above and reiterated by the Court of Justice in its judgment of 11 September 2019, HX v Council (C‑540/18 P, not published, EU:C:2019:707, paragraphs 48 to 50). According to that principle, in essence, the burden of proof lies with the institution where the grounds for listing are challenged on the basis that they are unfounded. The Court of Justice has thus held that the burden of proving the existence of sufficient information, within the meaning of Article 27(3) and Article 28(3) of Decision 2013/255, showing that the applicant was not, or was no longer, associated with the Syrian regime, that he exercised no influence over that regime and that he did not pose a real risk of circumvention of the restrictive measures adopted in respect of that regime did not fall on the applicant (see, to that affect, judgments of 14 June 2018, Makhlouf v Council, C‑458/17 P, not published, EU:C:2018:441, paragraph 86, and of 11 September 2019, HX v Council, C‑540/18 P, not published, EU:C:2019:707, paragraphs 50 and 51).
71 Consequently, an excessive standard of proof may not be imposed on the applicant in order to rebut the presumption of a link with the Syrian regime. Thus, the applicant must be considered to have succeeded in rebutting that presumption if he or she puts forward arguments or evidence capable of seriously calling into question the reliability of the evidence submitted by the Council or the Council’s assessment, in particular in the light of the conditions laid down in Articles 27(3) and 28(3) of Decision 2013/255, or if he or she produces before the Courts of the European Union a set of indicia establishing that he or she was never associated, or is no longer associated, with that regime, that he or she had no influence over the regime and that he or she did not pose a real risk of circumvention of the restrictive measures, in accordance with Articles 27(3) and 28(3) of that decision.
72 In the present case, however, the applicant has not succeeded in rebutting the presumption of a link with the Syrian regime. First, it should be pointed out that, in the first complaint, the applicant did not present any argument or evidence which might cast doubt on the reliability of the evidence submitted by the Council or on the assessment to be made of that evidence, nor did he put forward any concrete evidence which would enable the General Court to conclude that there was not, or was no longer, any link between him and that regime, that he had no influence over that regime or that he did not pose a real risk of circumvention of the restrictive measures. Secondly, even if account is taken of the arguments put forward by the applicant in the third complaint, seeking to call into question the second ground for listing, relating to association with the regime in question as referred to in Articles 27(1) and 28(1) of Decision 2013/255, the applicant cannot be regarded as having provided evidence capable of rebutting that presumption.
73 It is clear that the applicant denies that he is associated with the Syrian regime and that he has any influence over that regime, but confirms his participation in the ‘Grand Town’ project, in which the Syrian Ministry of Tourism is involved.
74 In the light of all the above, it must be held that the grounds for including the applicant’s name on the lists in question on the basis of his status as a leading businessperson operating in Syria is sufficiently substantiated and, therefore, in the light of that criterion, the listing is justified. The first complaint must therefore be rejected.
75 According to case-law, in view of the preventive nature of decisions adopting restrictive measures, if the Courts of the European Union consider that, at the very least, one of the reasons mentioned is sufficiently detailed and specific, that it is substantiated and that it constitutes in itself a sufficient basis to support that decision, the fact that the same cannot be said of other such reasons cannot justify the annulment of that decision (see judgment of 28 November 2013, Council v Manufacturing Support Procurement Kala Naft, C‑348/12 P, EU:C:2013:776, paragraph 72 and the case-law cited). Accordingly, without there being any need to examine the third complaint seeking to challenge the second ground for listing, the single plea in law and, consequently, the action as a whole must be dismissed.
Costs
76 Under Article 134(1) of the Rules of Procedure, the unsuccessful party is to be ordered to pay the costs if they have been applied for in the successful party’s pleadings. Since the Council has applied for costs and the applicant has been unsuccessful, the latter must be ordered to bear his own costs and to pay those incurred by the Council.
On those grounds,
THE GENERAL COURT (Fourth Chamber)
hereby:
1. Dismisses the action;
2. Orders Mr Khaled Zubedi to bear his own costs and to pay those incurred by the Council of the European Union.
Gervasoni | Madise | Martín y Pérez de Nanclares |
Delivered in open court in Luxembourg on 8 July 2020.