JUDGMENT OF THE GENERAL COURT (Fourth Chamber)
12 December 2013 (*)
(Common foreign and security policy – Restrictive measures against Iran with the aim of preventing nuclear proliferation – Freezing of funds – Restrictions on admission – Obligation to state reasons – Error of law – Error of assessment – Temporal adjustment of the effects of an annulment)
In Case T‑58/12,
Ghasem Nabipour, residing in Tehran (Iran),
Mansour Eslami, residing in Madliena (Malta),
Mohamad Talai, residing in Hamburg (Germany),
Mohammad Moghaddami Fard, residing in Tehran,
Alireza Ghezelayagh, residing in Singapore (Singapore),
Gholam Hossein Golparvar, residing in Tehran,
Hassan Jalil Zadeh, residing in Tehran,
Mohammad Hadi Pajand, residing in London (United Kingdom),
Ahmad Sarkandi, residing in Al Jaddaf, Dubai (United Arab Emirates),
Seyed Alaeddin Sadat Rasool, residing in Tehran,
Ahmad Tafazoly, residing in Shanghai (China),
represented by S. Kentridge QC, M. Lester, Barrister, and M. Taher, Solicitor,
applicants,
v
Council of the European Union, represented by M.‑M. Joséphidès, A. Varnav and A. De Elera, acting as Agents,
defendant,
APPLICATION for annulment, first, of Council Decision 2011/783/CFSP of 1 December 2011 amending Decision 2010/413/CFSP concerning restrictive measures against Iran (OJ 2011 L 319, p. 71), of Council Implementing Regulation (EU) No 1245/2011 of 1 December 2011 implementing Regulation (EU) No 961/2010 on restrictive measures against Iran (OJ 2011 L 319, p. 11), and of Council Regulation (EU) No 267/2012 of 23 March 2012 concerning restrictive measures against Iran and repealing Regulation (EU) No 961/2010 (OJ 2012 L 88, p. 1), in so far as those acts concern the applicants, and, secondly, of Council Decision 2013/270/CFSP of 6 June 2013 amending Decision 2010/413/CFSP concerning restrictive measures against Iran (OJ 2013 L 156, p. 10), in so far as that decision concerns the fourth and ninth applicants,
THE GENERAL COURT (Fourth Chamber),
composed of S. Papasavvas, acting as President, M. van der Woude (Rapporteur) and E. Buttigieg, Judges,
Registrar: S. Spyropoulos, Administrator,
having regard to the written procedure and further to the hearing on 30 May 2013,
gives the following
Judgment
Background to the dispute
1 Council Decision 2011/783/CFSP of 1 December 2011 amending Decision 2010/413/CFSP concerning restrictive measures against Iran (OJ 2011 L 319, p. 71) placed the applicants, Mr Ghasem Nabipour, Mr Mansour Eslami, Mr Mohamad Talai, Mr Mohammad Moghaddami Fard, Mr Alireza Ghezelayagh, Mr Gholam Hossein Golparvar, Mr Hassan Jalil Zadeh, Mr Mohammad Hadi Pajand, Mr Ahmad Sarkandi, Mr Seyed Alaeddin Sadat Rasool and Mr Ahmad Tafazoly, on the list 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). Annex II contains the list of persons referred to in Article 19(1)(b) of Decision 2010/413, which imposes restrictions on admission, and of persons and entities referred to in Article 20(1)(b) of that decision, relating to the freezing of funds.
2 In accordance with Decision 2011/783, Council Implementing Regulation (EU) No 1245/2011 of 1 December 2011 implementing Regulation (EU) No 961/2010 on restrictive measures against Iran (OJ 2011 L 319, p. 11) amended Annex VIII to 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) by adding, inter alia, the applicants’ names to the list of persons, entities and bodies subject to a freezing of funds which is set out in Annex VIII to Regulation No 961/2010.
3 The reasons put forward by the Council of the European Union in order to justify the applicants’ listing in Annex II to Decision 2010/413 and in Annex VIII to Regulation No 961/2010 concern the professional or capital links maintained by the applicants with Islamic Republic of Iran Shipping Lines (‘IRISL’) or with companies linked to IRISL.
4 By letter of 1 February 2012, the applicants challenged their listing and requested the Council to disclose all documents and evidence on which it had relied. The Council replied to them by letter of 12 March 2012. In that letter, the Council inter alia confirmed that Decision 2011/783 imposed not only fund-freezing measures but also restrictions on admission in respect of all the applicants.
5 Council Regulation (EU) No 267/2012 of 23 March 2012 concerning restrictive measures against Iran and repealing Regulation (EU) No 961/2010 (OJ 2012 L 88, p. 1) subsequently implemented Council Decision 2012/35/CFSP of 23 January 2012 amending Decision 2010/413 (OJ 2012 L 19, p. 22). Decision 2012/35 provides for additional restrictive measures against Iran. It does not affect the applicants.
6 Regulation No 267/2012 maintained the applicants’ names on the list of persons, entities and bodies – other than those designated by the United Nations Security Council or by the Sanctions Committee of the United Nations Security Council – whose assets have been frozen. That list is now set out in Annex IX to that regulation. The reasons for the applicants’ listing in Annex IX to Regulation No 267/2012 are identical to those stated in Annex VIII to Regulation No 961/2010, as amended by Implementing Regulation No 1245/2011.
7 Council Decision 2013/270/CFSP of 6 June 2013 amending Decision 2010/413 concerning restrictive measures against Iran (OJ 2013 L 156, p. 10; together with Decision 2011/783, ‘the contested decisions’) amended the reasons for the listing of the fourth and ninth applicants, Mr Fard and Mr Sarkandi, in Annex II to Decision 2010/413.
Procedure and forms of order sought
8 By application lodged at the Court Registry on 9 February 2012, the applicants brought the present action.
9 In the application, the applicants claim that the Court should:
– annul Decision 2011/783 and Implementing Regulation No 1245/2011, in so far as they concern the applicants;
– declare that the travel ban does not apply to them;
– order the Council to pay the costs.
10 Following the repeal and replacement of Regulation No 961/2010 by Regulation No 267/2012, the applicants sought, by document lodged at the Court Registry on 30 April 2012, to amend the form of order sought, by extending it to cover annulment of Regulation No 267/2012, in so far as it concerns them.
11 Following the adoption of Decision 2013/270, the fourth and ninth applicants, Mr Fard and Mr Sarkandi, sought, by document lodged at the Court Registry on 1 July 2013, to extend the form of order sought to include annulment of Decision 2013/270, in so far as it concerns them.
12 In its observations on those requests, submitted on 18 June 2012 and 8 August 2013 respectively, the Council invited the Court to grant the requests.
13 The Council contends that the Court should:
– dismiss the action;
– order the applicants to pay the costs.
14 By decision of 15 November 2012, the President of the Fourth Chamber of the General Court decided to give this case priority in the light of the special circumstances.
15 As two members of the Chamber were prevented from sitting in the present case, the President of the General Court designated two other judges to complete the Chamber pursuant to Article 32(3) of the Rules of Procedure of the General Court.
Law
1. Admissibility of the second head of claim
16 By their second head of claim, the applicants request the Court to declare that the restrictions on admission, under Article 19(1)(b) of Decision 2010/413, do not apply to them.
17 That request must be interpreted as, in essence, an application for the Court to issue directions to the Council. It should be noted in that regard that, in an action based on Article 263 TFEU, the Court has no power to issue directions to the institutions (see Case T‑49/07 Fahas v Council [2010] ECR II‑5555, paragraph 29 and the case-law cited).
18 The second head of claim must therefore be declared inadmissible.
2. Admissibility of the request to amend the form of order sought
19 By the present action the applicants have, in the application, sought annulment of Decision 2011/783, amending Decision 2010/413, and of Implementing Regulation No 1245/2011, in so far as they concern the applicants. As is apparent from paragraphs 5 and 6 above, since the application was lodged, Regulation No 961/2010, as amended by Implementing Regulation No 1245/2011, has been repealed and replaced by Regulation No 267/2012. The applicants applied within the time-limit prescribed in the sixth paragraph of Article 263 TFEU for the original form of order sought to be amended so that the action would cover the annulment of all those measures. The Council has invited the Court to grant that request.
20 It is to be borne in mind in this connection that, when a measure of direct and individual concern to an individual is replaced, during the proceedings, by another measure with the same subject-matter, this is to be considered a new factor allowing the applicant to adapt his claims and pleas in law. It would be contrary to the principle of due administration of justice and to the requirements of procedural economy to oblige the applicant to make a fresh application. Moreover, it would be inequitable if the institution in question were able, in order to counter criticisms of a measure that are contained in an application to the Courts of the European Union, to amend the contested measure or to substitute another for it and to rely in the proceedings on such an amendment or substitution in order to deprive the other party of the opportunity of extending his original pleadings to the later measure or of submitting supplementary pleadings directed against that measure (see, by analogy, Case T‑256/07 People’s Mojahedin Organization of Iran v Council [2008] ECR II‑3019, paragraph 46 and the case-law cited).
21 In the present case, the applicants’ request should therefore be granted and their action regarded as also seeking annulment of Regulation No 267/2012, in so far as it concerns them.
22 In addition, for the same reasons, the Court must grant the request to amend the form of order sought, submitted within the time-limit for bringing an action, following the adoption of Decision 2013/270, by the fourth and ninth applicants, Mr Fard and Mr Sarkandi (see paragraph 11 above), and their action must be regarded as seeking annulment not only of Decision 2011/783, Implementing Regulation No 1245/2011 and Regulation No 267/2012, but also of Decision 2013/270, in so far as those acts concern them (together, ‘the contested measures’).
3. Substance
23 The applicants raise four pleas in law in support of their application for annulment of their listing. The first plea in law alleges infringement of the obligation to state reasons. The second plea in law alleges error of assessment and infringement of the legal criteria for inclusion in the lists. The third plea in law alleges infringement of the rights of the defence and of the right to effective judicial protection. The fourth plea in law alleges breach of the principle of proportionality and infringement of fundamental rights, in particular the right to property, the freedom to pursue an economic or commercial activity, the right to the protection of private and family life and the right to protection of reputation.
First plea, alleging infringement of the obligation to state reasons
24 In the first place, as regards the restrictions on admission specifically, the applicants submit under their first plea in law that it is not clear from Decision 2011/783 whether they are subject to those measures on the basis of Article 19(1)(b) of Decision 2010/413. As a result there was legal uncertainty as to the content of that decision with regard to the persons concerned, leaving them unable to identify the measures that should form the subject-matter of the action.
25 In the second place, as regards both the restrictions on admission and the freezing of funds, the applicants maintain that the statement of reasons for the contested measures does not enable them to understand either the legal basis or the individual and specific reasons for their listing. They rely on a series of arguments that may be grouped together as follows.
26 First, the applicants claim that the Council has not identified the legal basis for listing natural persons. They state that the Council does not refer to natural persons in its letter of 5 December 2011 to IRISL and to companies linked to IRISL. Natural persons are not ‘entities’, as referred to in Article 20(1)(b) of Decision 2010/413.
27 Secondly, the applicants submit that even if the relevant legislation authorised the listing of natural persons, such persons could be designated only on the basis of their own responsibilities. Yet in the grounds set out in the contested measures to justify their inclusion, the Council merely refers to the positions that each of them is said to hold or to have held within the companies to which the restrictive measures apply. It does not indicate why the applicants may be regarded as being associated with Iran’s nuclear activities or as acting on behalf of or at the direction of IRISL.
28 Thirdly, the reasons for listing the applicants are too imprecise. Thus, the Council claims that the third, seventh, eighth and ninth applicants set up ‘front companies’, or that they are directors or shareholders of such companies, without explaining what it means by ‘front company’, without identifying those companies, and without stating the reasons why it considers them to be front companies.
29 Fourthly, the failure to state reasons cannot be remedied during the proceedings before the General Court.
30 The Council contends that the stated reasons for listing the applicants are sufficient, in so far as the grounds set out in the contested measures indicate in each case the applicant’s links with IRISL or with other companies included in a list, whether in a management or executive position with IRISL, its subsidiaries, front companies or any other listed company, or as a shareholder of such a company.
Preliminary observations on the obligation to state reasons in regard to restrictive measures
31 First of all, it must be borne in mind that, according to a consistent body of case-law, the purpose of the obligation to state the reasons on which an act adversely affecting an individual is based, which is a corollary of the principle of respect for the rights of the defence, is, first, to provide the person concerned with sufficient information to make it possible to ascertain whether the act is well founded or whether it is vitiated by a defect which may permit its legality to be contested before the Courts of the European Union and, secondly, to enable those Courts to review the legality of that act (see Case C‑417/11 P Council v Bamba [2012] ECR I‑0000, paragraph 49 and the case-law cited).
32 The statement of reasons required by Article 296 TFEU must disclose in a clear and unequivocal fashion the reasoning followed by the institution which adopted the measure in such a way as to enable the person concerned to ascertain the reasons for the measures and to enable the court having jurisdiction to exercise its power of review (Council v Bamba, paragraph 50).
33 Next, with regard to restrictive measures adopted under the common foreign and security policy, it must be noted that where the person concerned is not afforded the opportunity to be heard before the adoption of an initial decision to list him, compliance with the obligation to state reasons is all the more important because it constitutes the sole safeguard enabling the person concerned, at least after the adoption of that decision, to make effective use of the legal remedies available to him in order to challenge the lawfulness of that decision (Council v Bamba, paragraph 51, and Case T‑228/02 Organisation des Modjahedines du peuple d’Iran v Council [2006] (‘OMPI I’) ECR II‑4665, paragraph 140).
34 Therefore, the statement of reasons for an act of the Council which imposes a restrictive measure must identify not only the legal basis of that measure but also the actual and specific reasons why the Council considers, in the exercise of its discretion, that that measure must be adopted in respect of the person concerned (see, to that effect, Council v Bamba, paragraph 52; OMPI I, paragraph 146; and Case T‑390/08 Bank Melli Iran v Council [2009] ECR II‑3967, paragraph 83).
35 The statement of reasons must, however, be appropriate to the act at issue and the context in which it was adopted. The requirements to be satisfied by the statement of reasons depend on the circumstances of each case, in particular the content of the measure in question, the nature of the reasons given and the interest which the addressees of the measure, or other parties to whom it is of direct and individual concern, may have in obtaining explanations. It is not necessary for the reasoning to go into all the relevant facts and points of law, since the question whether the statement of reasons is sufficient must be assessed with regard not only to its wording but also to its context and to all the legal rules governing the matter in question. In particular, the reasons given for a measure adversely affecting a person are sufficient if that measure was adopted in a context which was known to that person and which enables him to understand the scope of the measure concerning him (Council v Bamba, paragraphs 53 and 54; OMPI I, paragraph 141; and Bank Melli Iran v Council, paragraph 82).
36 Lastly, the Council cannot be permitted to remedy a failure to state reasons before the General Court or to put forward a substituted statement of reasons or a supplementary statement of reasons.
37 First, to afford that possibility would prejudice the fundamental right to respect for the rights of the defence in all proceedings initiated against a person that are liable to culminate in a measure adversely affecting him which is reaffirmed in Article 41(2) of the Charter of Fundamental Rights of the European Union, which Article 6(1) TEU recognises as having the same legal value as the Treaties. That fundamental right is given concrete expression in the present case in Article 24(3) and (4) of Decision 2010/413, Article 36(3) and (4) of Regulation No 961/2010 and Article 46(3) and (4) of Regulation No 267/2012. According to the case-law, when initially entering a person or an entity on the list of persons or entities subject to restrictive measures, the Council is thus required to notify the person concerned of the grounds for his listing and afford him the right to be heard at the same time as, or immediately after, the decision is adopted (see, to that effect, Case C‑27/09 P France v People’s Mojahedin Organization of Iran [2011] ECR I‑0000, paragraphs 61, 64 and 67). To permit the Council to rely on new grounds before this Court would therefore be to deprive the person concerned of those rights.
38 Secondly, the possibility of being able to put forward new grounds before this Court would also prejudice the right to effective judicial protection, which is a general principle of European Union law, reaffirmed in Article 47 of the Charter of Fundamental Rights (see, to that effect and by analogy, Joined Cases C‑402/05 P and C‑415/05 P Kadi and Al Barakaat International Foundation v Council and Commission [2008] ECR I‑6351, paragraphs 335 to 337; OMPI I, paragraph 139; and Bank Melli Iran v Council, paragraph 105).
39 Thirdly, to allow the Council to rely before this Court on reasons that are based on new information would also be contrary to the principle that the legality of the contested measures may be assessed only on the basis of the elements of fact and of law on which they were adopted and not on the basis of information which was brought to the Council’s knowledge after the adoption of those measures, even if the Council takes the view that that information could legitimately be the basis for the adoption of those measures. In short, the Court cannot accept an invitation by the Council to substitute the grounds on which those measures are based (see, to that effect, Case T‑63/12 Oil Turbo Compressor v Council [2012] ECR II‑0000, paragraph 29).
40 In the present case, after determining whether the contested decisions have the requisite clarity as regards the adoption of restrictions on admission in respect of the applicants, it will be appropriate to examine, in the light of all that case-law, the complaints relating to the failure to state reasons for the contested measures, which have been put forward without distinction as to the restrictions on admission and the freezing of funds, by reviewing in turn the statement of reasons relating to the legal basis of all the restrictive measures at issue, the statement of reasons concerning the actual and specific reasons for the adoption of those measures, and then compliance of the references to ‘front companies’ with the requirements associated with the obligation to state reasons.
The alleged lack of clarity of the contested decision as regards the adoption of restrictions on admission in respect of the applicants
41 As regards the question whether the reasons put forward by the Council apply both to the fund-freezing measures and to the restrictions on admission, it should be noted that, in so far as the applicants were included in the list in Annex II to Decision 2010/413, that listing enabled them to understand that they were subject not only to fund-freezing measures but also to restrictions on admission under Article 19(1)(b) of that decision. That article expressly provides for the Member States to adopt such measures against persons, ‘as listed in Annex II’, fulfilling the stated legal criteria, Annex II containing the list that includes natural persons referred to in the aforementioned article.
42 In addition, it is evident from the arguments which the applicants put forward in the application that, notwithstanding the alleged uncertainty regarding the adoption of restrictions on admission in their case, they were able, in the light of Decision 2010/413, as amended by Decision 2011/783 so far as it concerns them, to challenge those measures in a pertinent manner.
43 Consequently, the contested decisions cannot be annulled, in so far as they provide for restrictions on admission in respect of the applicants, solely on the ground that they lacked clarity as to whether such measures had been adopted in respect of the applicants.
The statement of reasons relating to the legal basis of the applicants’ listing
44 With regard to the first complaint put forward by the applicants in respect of both types of restrictive measure at issue, regarding the failure to identify in the contested measures the legal basis for listing natural persons (see paragraph 26 above), it must be borne in mind that the statement of reasons for an act imposing restrictive measures must clearly and comprehensibly indicate the precise legal criterion or criteria on which those measures are based (see paragraph 34 above).
45 In practice, the statement of reasons for the listing of a natural person on account of the position he holds in a company or entity which is itself designated must be examined in conjunction with the reasons for that company’s or entity’s listing. Thus, in order to satisfy the obligation to specify in the statement of reasons for the restrictive measures concerned the legal criterion on which the listing of the particular natural person is based, it is sufficient that that legal criterion is readily identifiable, including in the light of the legal criterion or criteria underpinning that company’s or entity’s listing and set out in the contested measures. Where a natural person is placed on a list because of the influence he is capable of exerting over the conduct alleged against the company or entity in which he holds a position, the legal basis of his listing may, where appropriate, converge with that of the company’s or entity’s listing (see paragraph 110 below).
46 In the present case, all the applicants are included in the lists because of alleged direct or indirect links with IRISL. Seven of the eleven applicants are listed in Annex II to Decision 2010/413, in Annex VIII to Regulation No 961/2010 and in Annex IX to Regulation No 267/2012 on the grounds of their positions within companies linked to IRISL, as well as, in certain cases, on the ground that they are shareholders of such companies. The sixth and eighth applicants, Mr Golparvar and Mr Pajand, are also listed on the grounds of their former positions within IRISL. The ninth and tenth applicants, Mr Sarkandi and Mr Sadat Rasool, are listed on the grounds of their current positions within IRISL.
47 In those circumstances the applicants submit that, at the time of the adoption of the contested measures, on 1 December 2011 and 23 March 2012 respectively, the relevant legal criteria, which expressly referred to links with IRISL, did not cover natural persons (see paragraph 26 above). The specific provisions referring to links with IRISL set out – so far as concerns the restrictions on admission – in Article 19(1)(b) of Decision 2010/413 and – so far as concerns the freezing of funds – in Article 20(1)(b) of that decision, as well as in Article 16(2)(d) of Regulation No 961/2010 and Article 23(2)(e) of Regulation No 267/2012, referred only to legal persons, entities and bodies.
48 However, it must be stated that, in the light of the legal criteria laid down by the legislation applicable when the applicants were entered on the lists, it was reasonably possible to understand from the grounds for those listings, having regard to the grounds for the listing of the companies in which the applicants held positions, that the applicants were covered not on the basis of the legal criteria expressly referring to links with IRISL, but on the basis of general criteria laid down by that legislation.
49 Alongside the specific criteria referring in particular to links with IRISL, Article 19(1)(b) and Article 20(1)(b) of Decision 2010/413, Article 16(2)(a) of Regulation No 961/2010 and Article 23(2)(a) of Regulation No 267/2012 defined a number of categories of general criteria surrounding the adoption of restrictive measures. The first of those categories related to persons and entities directly involved in nuclear proliferation activities. The second category of general criteria related to persons and entities linked to persons or entities that were themselves directly involved. Among the specific criteria covered by that second category were two concerning natural persons. Those criteria related to the pursuit of an activity on behalf of or at the direction of a person or entity directly involved (see paragraph 106 below). A third category of general criteria, laid down by the relevant provisions both of Decision 2010/413 and Regulation No 961/2010 and of Regulation No 267/2012, at the time of the adoption of the contested measures, related in essence to persons and entities that had assisted designated persons or entities in evading sanctions. That third criterion could also, if necessary, be applied concurrently with one of the two other criteria mentioned above, where such assistance was given to an entity that was directly involved.
50 The reasons given for listing IRISL in Annex II to Decision 2010/413, Annex VIII to Regulation No 961/2010 and Annex IX to Regulation No 267/2012 are as follows:
‘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 UNSC called on States to conduct inspections of IRISL vessels, provided there are reasonable grounds to believe that the vessel is transporting proscribed goods, in UNSC [Resolutions] 1803 and 1929.’
51 It is thus evident from the grounds for IRISL’s listing that the Council suspected that entity of providing support for nuclear proliferation activities. Indeed, the Council referred in particular in those grounds to ‘IRISL’s connection to proliferation’. Therefore, without prejudice to the assessment as to whether that statement of reasons is well founded (see paragraphs 81, 95 and 96 below), it must be noted that the Council took into account IRISL’s unlawful shipments of military material in presuming that there was a serious risk of IRISL’s direct involvement in nuclear proliferation activities.
52 Since the Council had, in the contested measures, identified IRISL as being directly involved in nuclear proliferation, natural persons allegedly acting on behalf of that entity or at its direction could be taken into consideration, when the applicants were listed, on the basis of the general criteria mentioned in paragraph 49 above, concerning activity on behalf of or at the direction of an entity that was directly involved. Furthermore, natural persons who allegedly assisted IRISL or companies linked to IRISL in evading sanctions were also covered by the third general criterion mentioned above, covering the provision of assistance with a view to circumventing sanctions.
53 As regards the letter from the Council of 5 December 2011 relied on by the applicants (see paragraph 26 above), it did not refer to natural persons because it was addressed not to the applicants but to IRISL and to companies linked to it, and was informing those companies of the Council’s decision to maintain their listing. It did not concern the applicants and is therefore irrelevant in this case.
54 In those circumstances, having regard to the statement of reasons for the contested measures, the references to Article 19(1)(b) and to Article 20(1)(b) of Decision 2010/413 in the heading of Annex II to that decision, to Article 16(2) of Regulation No 961/2010 in the heading of Annex VIII to that regulation, and to Article 23(2) of Regulation No 267/2012 in the heading of Annex IX to that regulation made it possible to understand that the applicants’ listing was based on the general legal criteria relating to persons acting on behalf of or at the direction of a person or entity directly involved in nuclear proliferation, or persons who assisted designated persons or entities in evading sanctions (see paragraphs 49 and 52 above).
The actual and specific statement of reasons for the applicants’ listing
55 The Court must therefore examine the second complaint raised by the applicants against the two types of restrictive measure at issue, whereby the mere reference to the applicants’ positions within companies that are themselves subject to restrictive measures does not enable the actual and specific reasons for their listing to be understood (see paragraph 27 above).
56 Admittedly, the applicants correctly state that the mere fact that a person is in a management or senior or executive position in an undertaking or entity that is subject to restrictive measures is not sufficient to justify his being listed. In order for a natural person to fall within the relevant legal criteria defined by the relevant legislation, that person must also himself be involved in the conduct of which the undertaking or entity employing him is accused, or, more generally, in the activities referred to in the relevant legislation (see paragraph 108 below).
57 However, it is important to point out that the question of the statement of reasons, which concerns an essential procedural requirement, is separate from that of the evidence of the alleged conduct, which concerns the substantive legality of the act in question and involves assessing the truth of the facts set out in that act and the characterisation of those facts as evidence justifying the use of restrictive measures against the person concerned (Council v Bamba, paragraph 60; see also, to that effect, Case C‑548/09 P Bank Melli Iran v Council [2011] ECR I‑11381, paragraph 88).
58 In the present case, in order to determine whether the contested measures satisfy the obligation to state reasons, it is therefore necessary to ascertain whether, in the grounds stated in the contested measures, the Council set out, in a manner that is comprehensible and sufficiently precise, the reasons that led it to conclude that the applicants’ listing was justified in the light of the legal criteria applicable.
59 The grounds for listing the applicants mention, in respect of each applicant, the positions they held or hold within IRISL (the sixth applicant, Mr Golparvar, the eighth, Mr Pajand, the ninth, Mr Sarkandi, and the tenth, Mr Sadat Rasool) or within companies allegedly linked to IRISL. Those companies linked to IRISL are identified and are subject to restrictive measures precisely because of their alleged links with IRISL, which is regarded as being directly involved in nuclear proliferation activities. Furthermore, they operate for the most part in the ship management or shipping industry. Consequently, in the light of the reasons for IRISL’s listing and of the reasons for the listing of the abovementioned companies linked to IRISL set out in the contested measures, the reasons for the applicants’ listing are such as to enable it to be understood that the Council took account in particular of the applicants’ involvement – evidenced, according to the Council, by their positions – in the conduct of which IRISL or the abovementioned companies linked to IRISL are accused, in order to conclude that the applicants themselves were acting on behalf of or at the direction of IRISL, or that they were assisting IRISL group companies in evading sanctions. In particular, the applicants could not reasonably have been unaware that, by alluding in the contested measures to their positions within the abovementioned companies, the Council intended to highlight the power to influence decisions and the responsibility which might be supposed to result from those positions as regards any conduct of which those companies might be accused (see, by analogy, Council v Bamba, paragraph 58).
60 Without prejudice to the assessment of its validity, that actual and specific statement of reasons thus satisfies the requirements of the case-law with respect to the obligation to state reasons cited in paragraphs 31 to 39 above. It enables each of the applicants to understand the reasons for his listing and to defend himself, and the Courts of the European Union to review the legality of that listing.
The reference to ‘front companies’ in the grounds for listing the applicants
61 The applicants’ third complaint against the two types of restrictive measure at issue, relating to the insufficiently precise nature of the reference to IRISL ‘front companies’ in the grounds for listing four of the applicants (see paragraph 28 above), concerns the third applicant, Mr Talai, the seventh, Mr Zadeh, the eighth, Mr Pajand, and the ninth, Mr Sarkandi. It must be noted in that regard that, except in the grounds for listing the eighth applicant, none of those ‘front companies’ is identified in the grounds for the contested measures. Furthermore, those acts contain no other information about illicit activity by those companies or about the legal nature of the links between those companies and IRISL. Moreover, in its reply to a written question put by the Court concerning the meaning of ‘front company’, the Council merely stated that that notion meant ‘providing a cover for illicit activities, and [that] IRISL [was] well known for employing such types of cover in order to avoid sanctions’.
62 According to the case-law, the notion of ‘front company’ has no specific legal meaning and is used to designate, in essence, an interposed entity, created to conceal the identity of the party behind certain conduct (Case T‑53/12 CF Sharp Shipping Agencies v Council [2012] ECR I‑0000, paragraph 39).
63 In the present case, it must therefore be held that the reference in the contested measures to ‘front companies’ does not enable the applicants to understand the facts alleged against them and the Court to exercise its power of review, given the failure to identify those companies and the lack of any specific indication of the legal nature of the links between those companies and IRISL, or of the specific and individual reasons that led the Council to consider that those companies were involved in activities intended to circumvent the restrictive measures adopted against IRISL.
64 For all those reasons, the vague and general reference to the positions of the abovementioned four applicants in ‘front companies’, or to their status as shareholders of such companies, and to the role of one of them in the setting-up of such companies, cannot be taken into account in order to justify or help to justify the listing of those applicants.
65 Nevertheless, that finding does not permit the inference that the contested measures are vitiated by an inadequate statement of reasons in regard to the third, seventh, eighth and ninth applicants, since the listing of each of those applicants is also based on another reason, one that is clear and unequivocal.
66 It follows from all the foregoing considerations that the first plea in law must be rejected.
Second plea, alleging error of assessment and infringement of the relevant legal criteria
67 According to settled case-law, the judicial review of the lawfulness of an act whereby restrictive measures are imposed on an entity extends to the assessment of the facts and circumstances relied on as justifying it, and to the evidence and information on which that assessment is based. In the event of challenge, it is for the Council to present that evidence for review by the Courts of the European Union (see Case T‑489/10 Islamic Republic of Iran Shipping Lines and Others v Council [2013] ECR I‑0000, paragraph 42).
68 In the present case, it must be borne in mind as a preliminary point that the applicants are listed, in essence, because of their respective positions within IRISL or within companies which are themselves listed, either because they act on behalf of IRISL or assist IRISL group companies in evading sanctions, or because they are owned or controlled by IRISL.
69 In that context, the applicants maintain that the Council made a manifest error of assessment and did not respect the relevant legal criteria in determining that one or more of those criteria were satisfied in relation to each of the applicants.
70 In the first place, the applicants submit that the relevant legislation does not provide for natural persons to be listed solely because they hold certain positions in companies that have themselves been placed on the list. In the present case, the Council had not proved that the listing criteria were individually satisfied with respect to each of the applicants.
71 In the second place, the applicants dispute the validity of the listing of IRISL and companies alleged to be owned or controlled by IRISL, or acting on its behalf, and to which the applicants are alleged to be linked.
72 It must be noted in that regard that IRISL and the following companies: Hafize Darya Shipping Lines (HDSL), Irinvestship Ltd, IRISL Malta, IRISL Europe, Leadmarine, Safiran Payam Darya Shipping Lines (SAPID) and Rahbaran Omid Darya Shipmanagement Co. (also known as Soroush Saramin Asatir Ship Management), which are alleged to be linked to IRISL and which are mentioned in the grounds for listing some of the applicants, as set out in the contested measures, brought an action for annulment against the restrictive measures imposed on them. Those measures were annulled by the judgment in Islamic Republic of Iran Shipping Lines and Others v Council.
73 In their reply to a written question put by the Court, and subsequently at the hearing, the applicants had all submitted that any annulment of IRISL’s designation should automatically result in annulment of their own designations, since those designations would thus be entirely unfounded.
74 The applicants had emphasised, however, that the restrictive measures adopted against them should be annulled in any event, irrespective of the outcome of the action brought by, inter alia, IRISL in Case T‑489/10. They had claimed that, in any event, they were not agents of IRISL, that they did not act on its behalf and that many of the grounds for their designation were factually and legally erroneous.
75 In its reply to a written question put by the Court, the Council had stated that annulment of IRISL’s designation would not entail automatic legal consequences for the applicants. First, it had relied in that regard on the judgment of 20 March 2013 in Case T‑495/10 Bank Saderat v Council, not published in the ECR, paragraphs 39 to 41, in which the Court had upheld the listing of the applicant, Bank Saderat plc, by Decision 2011/783, even though the listing of its parent company, Bank Saderat Iran, had just been annulled in Case T‑494/10 Bank Saderat Iran v Council [2013] ECR I‑0000. Secondly, the Council had contended that, in the event of annulment of IRISL’s listing, it would endeavour to repair the deficiencies in IRISL’s listing identified by the Court. Only if those deficiencies could not be repaired would the applicants’ names have to be withdrawn from the lists. The Council reiterated that second argument at the hearing, in response to a question put by the Court.
76 In those circumstances, it is appropriate to consider, first of all, the effect of the judgment in Islamic Republic of Iran Shipping Lines and Others v Council on the present case, then to determine whether the applicants’ listing was in any event unjustified, owing to the applicants’ own alleged non-involvement in unlawful activities, irrespective of the question whether or not IRISL’s listing was well founded. The Court must first determine the evidence that may properly be relied on by the Council in the present case.
The evidence that may properly be relied on by the Council
77 In order to determine the evidence that may properly be relied on in this case by the Council before this Court, it should be noted that the right of the person concerned to communication of the evidence against him, in accordance with the fundamental right to respect for the rights of the defence mentioned in paragraph 37 above, means, first of all, his right to the initial communication of information that is sufficiently detailed to enable him to understand the reasons for his designation and, then, the right of access to the file. When sufficiently precise information has been communicated, enabling the person concerned to make his point of view on the evidence adduced against him by the Council known to advantage, the principle of respect for the rights of the defence does not mean that the Council is obliged spontaneously to grant access to the documents in its file. It is only on the request of the person concerned that the Council is required to provide him with access to all non-confidential official documents concerning the measure at issue (Case T‑390/08 Bank Melli Iran v Council, paragraph 97).
78 In the present case, the applicants had asked the Council, by letter of 1 February 2012, to disclose to them all the documents and evidence on which their listing was based. However, the Council replied to that request, by letter of 12 March 2012, only after the present action had been brought. Furthermore, and in any event, neither the Council’s reply nor the documents disclosed to the relevant persons in the annex to that reply contain information over and above that mentioned in the contested measures.
79 Consequently, it must be held that only the evidence referred to by the contested measures may be taken into account in assessing whether the reasons set out in those measures are supported to the requisite legal standard. To accept that the Council can properly invoke, before this Court, inculpatory evidence which was not disclosed to the persons concerned before the present action was brought, notwithstanding their request, would in any event be contrary to the fundamental right to respect for the rights of the defence and to the right to effective judicial protection, and also, if the evidence is new, to the principle that the legality of a measure may be assessed only on the basis of the elements of fact and of law on which it was adopted (see paragraph 39 above).
80 In those circumstances, it must be noted at the outset that the Council cannot properly invoke as evidence, in its written pleadings, the indictment on 20 June 2011 by the Supreme Court of the State of New York (District Attorney) of the sole shareholder of certain companies mentioned in the grounds for listing certain applicants, together with three of the applicants, for participation in a conspiracy (‘conspiracy in the fifth degree’).
The effect of the judgment in Islamic Republic of Iran Shipping Lines and Others v Council on the present case
81 It must be borne in mind that, in Islamic Republic of Iran Shipping Lines and Others v Council, the Court found, in essence, that the initial listing and the maintenance of the listing of IRISL and of the other applicants in Annex II to Decision 2010/413, Annex VIII to Regulation No 961/2010 and Annex IX to Regulation No 267/2012 were vitiated by an error of assessment. It therefore annulled the restrictive measures adopted against those companies (see paragraphs 66, 67, 78 and 79 of that judgment).
82 In the first place, as regards the listing of IRISL and of the other applicants in Annex VIII to Regulation No 961/2010, repealed by Regulation No 267/2012, it should be noted that the annulment of that listing concerns only the effects which Regulation No 961/2010 produced between the date of its entry into force and the date of its repeal (Islamic Republic of Iran Shipping Lines and Others v Council, paragraph 80).
83 Consequently, in so far as Regulation No 961/2010 and Implementing Regulation No 1245/2011 which amended it were no longer in force when the entries of IRISL and the other applicant companies in Annex VIII to Regulation No 961/2010 were annulled, that annulment takes effect immediately. That listing is therefore null and void.
84 In the present case, however, the applicants were listed on 1 December 2011 in Annex VIII to Regulation No 961/2010 by Implementing Regulation No 1245/2011 on account of the positions they held within IRISL, as an entity directly involved in nuclear proliferation, or within companies linked to IRISL.
85 Therefore, since the listing of IRISL and of the other applicant companies in Case T‑489/10 in Annex VIII to Regulation No 961/2010 must be considered null and void, it must be held that the applicants’ listing in that annex cannot be justified by the relevant persons’ direct or indirect links with IRISL, in so far as IRISL had not been properly identified as providing support for nuclear proliferation, during the period under consideration between the date of the entry into force and the date of repeal of Regulation No 961/2010.
86 It follows from this that the applicants’ listing in Annex VIII to Regulation No 961/2010 by Implementing Regulation No 1245/2011 is vitiated by an error of assessment.
87 In the second place, as regards the listing of IRISL and the other applicant companies in Annex II to Decision 2010/413 and in Annex IX to Regulation No 267/2012, it should be noted that, in the judgment in Islamic Republic of Iran Shipping Lines and Others v Council annulling that listing, the Court nevertheless maintained the effects of Decision 2010/413, as amended by Council Decision 2010/644/CFSP of 25 October 2010 (OJ 2010 L 281, p. 81), with regard to the applicant companies until the annulment of Regulation No 267/2012 took effect, as from the date of expiry of the period for bringing an appeal referred to in the first paragraph of Article 56 of the Statute of the Court of Justice of the European Union or, were an appeal to be brought within that period, as from the date of dismissal of the appeal.
88 Accordingly, the entry of IRISL and the other applicant companies on the lists in Annex II to Decision 2010/413 and in Annex IX to Regulation No 267/2012 cannot, following that judgment, be considered null and void at the time of the applicants’ listing on 1 December 2011 in Annex II to Decision 2010/413 and on 23 March 2012 in Annex IX to Regulation No 267/2012.
89 Nevertheless, it must be held that the findings of the Court in that judgment, as regards the lack of justification for the entry of IRISL and the other applicant companies on the lists, can be applied to the present case in so far as the arguments and the evidence properly relied on by the parties and the legal and factual background are identical in the two cases (see, to that effect, Case C‑248/99 P France v Monsanto and Commission [2002] ECR I‑1, paragraph 35, and order in Case T‑97/04 Gnemmi and Aguiar v Commission [2007] ECR-SC I‑A‑2‑117 and II‑A‑2‑799, paragraphs 31 and 32).
90 In the present case, the applicants do not simply refer to the action brought in Case T‑489/10. In their written pleadings, they recapitulate in clear terms the fourth plea in law relied on by IRISL and the other applicants in that case, according to which the United Nations Security Council’s findings, on which IRISL’s listing is based, did not relate to nuclear proliferation activities. In addition, the applicants maintain that the Council’s assertions concerning IRISL’s involvement in such activities are not based on any evidence.
91 The applicants go on to challenge the Council’s contention in the defence that it is a well-known fact that IRISL has been having recourse to other companies to continue carrying out illegal activities and to evade sanctions. According to the applicants, that argument is not supported by any evidence.
92 Furthermore, the applicants criticise the Council for having asserted in the defence, without substantiating its claim, that the companies for which they work are themselves involved in nuclear proliferation activities. They state that those companies are listed only because they are ‘owned’ or ‘controlled’ by IRISL.
93 The present dispute thus differs from the case that resulted in the judgment in Bank Saderat v Council, relied on by the Council, in which the applicant merely referred to the actions brought by its parent company against its own listing, which led the Court to declare the plea alleging, in essence, that the parent company was not involved in nuclear proliferation inadmissible under Article 44(1)(c) of the Rules of Procedure.
94 It is appropriate, therefore, to assess the validity of the applicant’s listing in Annex II to Decision 2010/413 and in Annex IX to Regulation No 267/2012 in the light of the findings of the Court in Islamic Republic of Iran Shipping Lines and Others v Council.
95 It is clear from Islamic Republic of Iran Shipping Lines and Others v Council that the Council failed to establish that IRISL had provided support for nuclear proliferation. The Court held that ‘even if it appears appropriate to regard the fact that IRISL was involved in the three incidents concerning the shipment of military material in breach of the prohibition laid down in paragraph 5 of Resolution 1747 (2007) as increasing the risk that [it] may also be involved in incidents relating to the shipment of material linked to nuclear proliferation, that does not, as the relevant legislation now stands, justify the adoption and maintenance of restrictive measures against it’ (paragraph 66 of the judgment).
96 Consequently it must be held, for the same reasons as those set out in paragraphs 47 to 66 of the judgment in Islamic Republic of Iran Shipping Lines and Others v Council, to which reference must be made, that the Council has not established in the present case that IRISL was directly involved in nuclear proliferation.
97 That being the case, even if the companies other than IRISL referred to in the grounds for the applicants’ listing are in fact owned or controlled by IRISL or act on its behalf or as directed by it, that does not justify the adoption and maintenance of the restrictive measures to which they are subject, since IRISL has not been properly identified as providing support for nuclear proliferation (see, to that effect, Islamic Republic of Iran Shipping Lines and Others v Council, paragraph 77).
98 It must therefore be held that the listing of the sixth, eighth, ninth and tenth applicants, Mr Golparvar, Mr Pajand, Mr Sarkandi and Mr Sadat Rasool (see paragraph 46 above), cannot properly be justified on the grounds set out in the contested measures concerning the positions they allegedly held within IRISL as an entity identified as being directly involved in nuclear proliferation.
99 Similarly, the entry of the applicants on the lists cannot properly be justified on the grounds set out in the contested measures concerning the links which they allegedly maintained with companies linked to IRISL, irrespective of the question whether or not those companies have brought an action challenging their inclusion in the lists. If IRISL cannot be regarded as being directly involved in activities relating to nuclear proliferation, no allegation of unlawful conduct can be made against those companies solely on the basis of their alleged links with that entity. Consequently, the applicants’ possible involvement in the activity of the companies linked to IRISL cannot be of an unlawful nature.
100 Therefore, the disputed restrictive measures adopted against the applicants are vitiated by an error of assessment.
101 It follows from this that the applicants’ listing in Annex II to Decision 2010/413, Annex VIII to Regulation No 961/2010 and Annex IX to Regulation No 267/2012 must be annulled, and there is no need to examine the other arguments and pleas in law.
102 However, in the light of the positions adopted by the parties, the Court considers it appropriate, in the interests of the sound administration of justice, also to examine the applicants’ arguments that their listing was in any event unjustified in that they were not involved in unlawful activities, irrespective of the question whether or not IRISL had been properly identified as being directly involved in nuclear proliferation (see paragraphs 74 to 76 above).
The applicants’ own involvement in the activities to which the relevant legal criteria relate
103 It is necessary, therefore, to ascertain whether the matters relied on by the Council would have been capable of justifying the applicants’ listing, in the light of the relevant legal criteria, had IRISL been properly identified as being directly involved in nuclear proliferation.
104 The applicants maintain that the specific reasons relied on by the Council are inaccurate or too imprecise. They claim, in particular, that a person’s previous position cannot justify his designation.
105 Furthermore, the applicants dispute the Council’s argument that they had influence over IRISL subsidiaries because of their senior or management or executive positions. They also claim that, in any event, it is not a criterion for listing that a person should have influence within a company linked to an entity that is directly involved in nuclear proliferation if that company is not itself accused of providing support for such activities.
106 So far as concerns the restrictive measures against Iran, it must be borne in mind that, apart from the criterion relating to direct involvement in nuclear proliferation activities, the relevant legislation in the present case defines only two specific criteria based on links with a person or entity directly involved that may constitute a legal basis for listing natural persons (see paragraph 49 above). Those criteria relate to persons and entities acting on behalf of or at the direction of a person or entity that is directly involved. In addition, a third criterion, also applicable both to persons and to entities, refers to the assistance given to designated persons or entities in evading sanctions. Thus the relevant criteria relate neither to natural persons holding management, senior or executive positions in entities that are directly involved in nuclear proliferation activities, nor to persons holding those types of positions within companies owned or controlled by such entities or acting on their behalf, or within companies providing support to a designated person or entity for the purpose of evading sanctions.
107 Against that legal background, the requirement of a clear and precise legal basis precludes the adoption of restrictive measures against a natural person merely on account of the position he holds within an entity that is itself included in the lists. Such an approach would effectively be based on a presumption for which no provision has been made in the relevant legislation. Consequently, according to the case-law, the listing of a natural person on account of his links with a person or entity which is itself included in the list cannot be based on presumptions that are not substantiated by the conduct of the person concerned (see, to that effect and by analogy, Case C‑376/10 P Tay Za v Council [2012] ECR I‑0000, paragraphs 65 to 72).
108 Therefore, only a natural person’s own involvement in activities to which the relevant legislation relates justifies the adoption of restrictive measures against him. The adoption of such measures meets the objectives of the legislation only if the responsibilities of the person concerned have a direct or indirect link with nuclear proliferation or with assistance given to a designated person in evading sanctions.
109 However, the question whether a natural person is involved in activities to which the legislation relates cannot be answered in the abstract but must be examined on the basis of the particular circumstances of each case. There are many factors that may be taken into account. These include the reasons which led to the listing of the company or companies in which the natural person in question holds a position, that person’s position in the hierarchy of that company or those companies, the number of posts held at the same time or successively within a number of companies that are themselves listed, or the capital links a natural person maintains with one or more companies involved.
110 As a general rule, where the natural person in question holds a post within either an entity that is directly involved in nuclear proliferation activities, or a company acting on behalf of such an entity or a company assisting a designated person in evading sanctions, it is sufficient, for the purposes of demonstrating that that individual is involved in unlawful conduct, that the Council establishes that he holds the principal managerial position in that entity or company, and thus assumes responsibility for the activities of the entity or company which he manages. If, on the other hand, the individual in question, holding a managerial, senior or executive position, is linked to the entity concerned or to the company by a relationship of subordination, it is incumbent on the Council to establish, on the basis of a body of precise and consistent evidence, that that person is capable of influencing the activities alleged against the company or the entity employing him.
111 In the present case, it must be noted at the outset, in the light of the grounds for listing the applicants set out in the contested measures and the parties’ arguments, that the Council does not maintain before this Court that any of the applicants were, at the time of the adoption of the contested measures, holding the principal managerial post at IRISL or at one of the companies mentioned in the grounds for their designation.
112 Furthermore, in its reply to the Court’s written questions, the Council admitted that it was unable to specify the hierarchical position of the titles which the applicants hold or held in the companies concerned, or to state whether other persons held positions of similar importance in those companies.
113 Examination of the grounds for listing the applicants will therefore concern only the question whether the Council put forward a body of sufficiently reliable evidence to conclude that the applicants were in a position to influence the unlawful activities of the companies employing them (see paragraph 110 above, in fine) or that they were themselves involved, directly or indirectly, in unlawful activities (see paragraph 109 above).
114 As regards the evidential value to be given to the evidence relating to positions which the person concerned previously held within IRISL or a company linked thereto, it must be pointed out that the fact that the person concerned has ceased to hold that position does not, by itself, mean that that position is irrelevant, in so far as his earlier activities could influence his conduct within companies linked to IRISL. However, taken in isolation, the positions formerly held within IRISL by certain applicants do not, in the absence of other sound and consistent evidence, justify their entry on the list. It is for the Council to put forward evidence from which it may reasonably be inferred that the person concerned maintained links with IRISL, justifying his entry on the list, after he had ceased to hold a position within that entity.
115 In the light of all the legal and factual considerations set out in paragraphs 106 to 114 above, the Court must determine whether, if IRISL and the companies linked thereto had been properly entered on the lists – which, as has been found in paragraphs 95 and 96 above, is not the case –, it would be possible to consider the Council to have proved to the requisite legal standard that the applicants were involved in unlawful activities, having regard to the relevant legislation.
– The listing of the first applicant
116 The reasons given for the disputed restrictive measures in respect of the first applicant, Mr Nabipour, are as follows:
‘Managing Director and shareholder of Rahbaran Omid Darya Shipmanagement Company, the new name for the Soroush Sarzamin Asatir Ship Management Company (a.k.a. Soroush Saramin Asatir Ship Management Company) (SSA SMC) designated on the European Union lists, in charge of IRISL’s technical ship management. Nabipour is shipping manager for IRISL.’
117 Thus, it seems initially clear from that statement of reasons that the first applicant was entered in the lists for two reasons, relating respectively to his positions as:
– managing director and shareholder of Rahbaran Omid Darya Shipmanagement;
– shipping manager for IRISL.
118 The ambiguous wording of the second reason might suggest that it is a reference to a position which the first applicant held within IRISL. However, in the light of the grounds for the listing of Rahbaran Omid Darya Shipmanagement, that second reason must be construed as referring in fact to the first applicant’s responsibilities in the management of IRISL vessels in his capacity as managing director of Rahbaran Omid Darya Shipmanagement.
119 The Iranian company Rahbaran Omid Darya Shipmanagement is itself listed for the following reasons: ‘Acts on behalf of IRISL; [a] Tehran-based ship management company[;] acts as technical manager for many of SAPID’s vessels.’ SAPID is a company listed on the grounds that it acts on behalf of IRISL and performs bulk services.
120 At the hearing, the Council, clarifying the second sentence of the statement of reasons for the first applicant’s listing as set out in the contested measures, confirmed that it was not asserting that the first applicant was employed by IRISL. It stated that it was relying only on the applicant’s indirect links with that entity through Rahbaran Omid Darya Shipmanagement. By providing, within the latter company, the technical ship management of transiting IRISL vessels, the first applicant had assisted that entity in its attempts to circumvent sanctions.
121 In that context, the first applicant denies not only the validity of the listing of Rahbaran Omid Darya Shipmanagement but also any personal involvement in the activities alleged against that company.
122 It is necessary therefore to determine whether the first applicant could be regarded as being personally involved in the decisions of Rahbaran Omid Darya Shipmanagement.
123 The first applicant states that he is only the Technical Ship Managing Director of Rahbaran Omid Darya Shipmanagement, and that his duties are therefore entirely technical.
124 In that regard, it must be noted that the first applicant’s duties as technical managing director do not give grounds for a presumption that he was personally involved in the decisions of the company employing him concerning the relationship of that company with IRISL. The same is true of his capacity as shareholder of Rahbaran Omid Darya Shipmanagement, since the first applicant’s shareholding in that company is not specified. Furthermore, the Council did not put forward any other evidence that would give grounds for assuming that the first applicant was capable of influencing any activity that may have been carried out by Rahbaran Omid Darya Shipmanagement on behalf of IRISL.
125 Therefore, the Council has not demonstrated that the first applicant was in a position to influence the decisions of his employer regarding the links it maintained with IRISL.
126 Consequently, for those various reasons, the applicant’s listing is not justified in any event, irrespective of the question whether or not IRISL was properly identified as being directly involved in nuclear proliferation.
127 It follows from this that the first applicant’s listing is in any event vitiated by an error of assessment.
– The listing of the second applicant
128 The reasons given for the disputed restrictive measures in respect of the second applicant, Mr Eslami, are as follows:
‘Managing Director of EU-sanctioned IRISL Malta Limited, alias Royal Med Shipping Company.’
129 It is thus evident from those reasons that the Council entered the second applicant on the lists on the basis of two considerations:
– the applicant was, at the time of his listing, managing director of European Union-sanctioned IRISL Malta Ltd;
– that company and Royal Med Shipping Co. were one and the same company.
130 However, the second applicant maintains that he held the position of managing director of IRISL Malta only from 2007 to 2010. That company had finally closed down in December 2010 after IRISL vessels had ceased to call at Malta in the middle of 2010.
131 In addition, the second applicant claims that Royal Med Shipping is a completely separate company from IRISL Malta. It had acted as agent for HDSL in Malta and since December 2011 had been in the process of being closed down. The second applicant had never worked for either Royal Med Shipping or HDSL.
132 In contesting those arguments, the Council merely emphasises in the defence the link between HDSL and IRISL and the importance of the role of IRISL Malta for IRISL’s vessels. In the rejoinder, it also contends that the second applicant has not provided any proof that when he ceased to hold the position of managing director of IRISL Malta in 2010, he retired, at the age of 45.
133 In the light of those arguments, it must, in the first place, be noted that the Council does not dispute in the defence the fact that the second applicant had not held a position at IRISL Malta for approximately one year by the time he was initially listed on 1 December 2011. Therefore, in so far as the second applicant had explicitly stated in the application that he held that position only from 2007 to 2010, it must be held that, in accordance with the first subparagraph of Article 48(2) of the Rules of Procedure, the Council challenge to that assertion in its rejoinder is in any event out of time and must therefore be declared inadmissible. Contrary to the Council’s contentions, that new defence plea is not based on any new matter of law or of fact invoked in the reply. Moreover, in so far as the Council merely maintains that the second applicant has not proved that he retired once he was no longer in post as managing director of IRISL Malta, suffice it to note that, in any event, the issue that is relevant in the present case is whether the second applicant continued to conduct any business on behalf of or at the direction of IRISL after he had ceased to hold a position at IRISL Malta (see paragraphs 136 to 138 below), and not whether he has retired.
134 Nor, moreover, does the Council dispute that Royal Med Shipping is a separate company from IRISL Malta or that the second applicant has never worked for Royal Med Shipping.
135 In those circumstances, it must be held that the grounds for listing the second applicant are vitiated by a twofold error of fact, in that, first, the Council refers implicitly, but clearly, to the applicant as the current managing director of IRISL Malta and, secondly, it deems that company to be the same company as Royal Med Shipping.
136 In the second place, the Court must therefore examine whether, having regard to the relevant legal criteria and in the light of the evidence properly adduced by the Council, the second applicant’s listing was justified on the basis of his former position as managing director of IRISL Malta, designated as acting on behalf of IRISL.
137 In that regard, it must be noted that although the second applicant ceased to hold the position of managing director of IRISL Malta only relatively recently, approximately one year before he was listed, that is not sufficient for it to be presumed that he maintained links with IRISL. It is for the Council to provide evidence of the second applicant’s conduct – once he was no longer in post – from which it might reasonably be concluded that, at the time of the adoption of the contested measures, the second applicant was involved in activities on behalf of or at the direction of IRISL (see paragraph 114 above). The Council cannot, without reversing the burden of proof, criticise the second applicant for having failed to prove that he had ended all activity within the IRISL group, by requiring him to demonstrate that he did not engage in any activity falling within the relevant legal criteria after he ceased to hold the position of managing director of IRISL Malta.
138 It must be added that, considered in isolation, the fact that the second applicant previously held an important position at IRISL Malta is in this instance a particularly weak indication that the second applicant had maintained links with IRISL at the time of the adoption of the contested measures, given that the Council has not established that the second applicant had, in his capacity as managing director of IRISL Malta, been personally involved in the unlawful activities alleged against that company. The Council is not claiming that the second applicant had the principal managerial post at IRISL Malta. Furthermore, it has not put forward any concrete evidence from which it might be presumed that the second applicant was in a position to influence the decisions of that company concerning its alleged unlawful activities on behalf of IRISL.
139 Consequently, and without it being necessary to determine whether the Council had proved to the requisite legal standard that IRISL Malta was, before its closure, acting on behalf of IRISL, it must be held that the second applicant’s former position as managing director of IRISL Malta did not justify his designation.
140 It follows from this that the second applicant’s listing is in any event vitiated by errors of fact and by an error of assessment, irrespective of the question whether or not IRISL was properly identified as being directly involved in nuclear proliferation.
– The listing of the third applicant
141 The reasons given for the disputed restrictive measures in respect of the third applicant, Mr Talai, are as follows:
‘Executive Director of IRISL Europe, Executive Director of EU-sanctioned HTTS and EU-sanctioned Darya Capital Administration GmbH. Director of several front companies owned or controlled by IRISL or its affiliates.’
142 With regard to that statement of reasons, it must be borne in mind first of all that the status of director of front companies does not meet the requirements of Article 296 TFEU and cannot therefore be taken into account (see paragraphs 61 and 64 above).
143 As to the other reasons, the Council explained in its written pleadings that the status of executive director of IRISL was a reference to his status as a senior member of IRISL. The Council confirmed at the hearing, as noted in the minutes thereof, that Mr Talai’s status as a senior member was the only reason for his listing.
144 It must be noted, however, that when the contested measures were adopted, the legal criterion relating to the status of ‘senior member’ of IRISL was not such as to enable restrictive measures to be taken against Mr Talai.
145 That criterion was not among the criteria for adoption of restrictions on admission defined in Article 19(1)(b) of Decision 2010/413. As regards fund-freezing measures, Article 20(1)(b) of Decision 2010/413 referred, among the criteria for adoption of fund-freezing measures, to ‘other senior members and entities of … IRISL’. However, that criterion was not set out by the Council in Article 16(2)(a) of Regulation No 961/2010, and was therefore not applicable within the scope of the FEU Treaty. Furthermore, whereas Decision 2012/35 amended Article 20(1)(b) of Decision 2010/413 by replacing the criterion referring to other senior members of IRISL with that referring to ‘other members and entities of … IRISL’, that last criterion was not set out in Article 23(2) of Regulation No 267/2012 either.
146 That being the case, the Council was entitled to take into account the positions allegedly held by the third applicant within companies linked to IRISL only by taking as a basis for the contested measures the legal criteria laid down by the relevant legislation that are mentioned in paragraph 106 above.
147 Consequently, the restrictions on admission imposed on the third applicant by Decision 2011/783 and the fund-freezing measures provided for in his case by Implementing Regulation No 1245/2011 and maintained by Regulation No 267/2012 on the basis of the criterion relating to the status of ‘senior member of IRISL’ have no appropriate legal basis in any event.
148 It follows from this that the third applicant’s listing in Annex II to Decision 2010/413, on the basis of Article 19(1)(b) of that decision, and in Annex VIII to Regulation No 961/2010 and Annex IX to Regulation No 267/2012, must in any event be annulled, irrespective of the question whether or not IRISL was properly identified as being directly involved in nuclear proliferation.
– The listing of the fourth applicant
149 The reasons given for the initial entry of the fourth applicant, Mr Fard, on 1 December 2011, in Annex II to Decision 2010/413 by Decision 2011/783, and in Annex VIII to Regulation No 961/2010 by Implementing Regulation No 1245/2011, and then for maintaining his listing, on 23 March 2012, in Annex IX to Regulation No 267/2012, are as follows:
‘F: Regional Director of IRISL in the United Arab Emirates, Managing Director of Pacific Shipping, sanctioned by the European Union, of Great Ocean Shipping Company, alias Oasis Freight Agency, sanctioned by the European Union. Set up Crystal Shipping FZE in 2010 as part of efforts to circumvent EU designation of IRISL.’
150 It is thus evident from those reasons, in the light of the grounds for listing the companies referred to therein, that the entry of the fourth applicant on the lists is based on the following positions and activities of the person concerned:
– regional director of IRISL in the United Arab Emirates;
– managing director of Pacific Shipping, which is subject to European Union sanctions on the following grounds:
– the company acts for IRISL;
– its managing director is Mr Fard;
– the company was involved in setting up front companies, the names of which were to be used on bills of lading in order to circumvent sanctions;
– the company continues to be involved in the scheduling of IRISL ships;
– managing director of Great Ocean Shipping Co., alias Oasis Freight Agency, which is subject to European Union sanctions; it should be noted that that company appears twice on the list, on the following grounds:
– the firm was used to set up front companies for IRISL in the United Arab Emirates, including Good Luck Shipping which replaced it;
– its managing director is Mr Fard;
– set up Crystal Shipping FZE, established in Dubai, in 2010 as part of efforts to circumvent IRISL’s listing; Crystal Shipping is listed on the following grounds:
– it is owned by IRISL agent Pacific Shipping;
– it was set up in 2010 by Mr Fard as part of efforts to circumvent IRISL’s listing;
– in December 2010 it was used to transfer funds to release impounded IRISL ships and to mask IRISL involvement.
151 The fourth applicant disputes those grounds, claiming that he was compelled to retire in 2011 as a result of the sanctions imposed by the contested measures. There is therefore no justification for his listing, as he no longer has any link with IRISL.
152 The Council notes that the certificate provided by the fourth applicant as proof of his retirement mentions that the ‘date of establishment’ –corresponding to the date of establishment of pension rights – is 21 April 2012, that is more than two months after the application was lodged. Moreover, that document records 34½ years of professional activity, whereas the applicant had indicated 32 in the application. Such inconsistencies and the fact that being retired would not prevent the fourth applicant from continuing to work had led the Council to conclude that the fourth applicant’s listing was still justified.
153 Nevertheless, it must be noted that the fourth applicant stated at the hearing, without being contradicted by the Council, that he had retired before he was listed, on 23 March 2012, in Annex IX to Regulation No 267/2012.
154 In addition, the fourth applicant maintains that his listing was unfounded even before he retired. He states first of all that he was managing director of IRISL Middle East in Dubai, which was incorporated in 2004 in order to supervise IRISL ships’ activities in the Middle East, in the Indian subcontinent and on the southern shores of the Mediterranean. That company had been inactive since the imposition in 2008 of sanctions against Iran by the Office of Foreign Assets Control, a United States financial control body.
155 Next, the fourth applicant states that, in order to manage matters relating to the Middle East region, Pacific Shipping was formed to cater for ships’ operations from ports in the Indian sub-continent and the Mediterranean ports. That company would soon be liquidated.
156 Moreover, Great Ocean Shipping, of which the fourth applicant was managing director, had ceased to operate after IRISL was entered on the list of United States sanctions in 2008. That company had been liquidated in November 2011, and all the shipping agency work had been entrusted to Good Luck Shipping, with which the fourth applicant had no connection. Furthermore, the fourth applicant had had no involvement in the shareholding or management of Great Ocean Shipping Services, which acted as SAPID’s and HDSL’s agent in Dubai.
157 Lastly, Crystal Shipping had been incorporated in order to enter into the container lease business. As that business had not materialised, the shareholders had decided to close the company.
158 The Council contends that Pacific Shipping seems to have been taking over the activities of IRISL Middle East following the sanctions imposed by the United States. Furthermore, the fourth applicant did not dispute his role in the setting-up of Crystal Shipping. The restructuring of several of the companies for which Mr Fard works did not negate that role, since that type of operation is often used to circumvent the restrictive measures of the European Union.
159 It is evident from the reasons stated in the contested measures, set out in paragraph 150 above, that Great Ocean Shipping and Pacific Shipping, of which the applicant was managing director, and Crystal Shipping FZE, set up by the applicant, were listed on the basis of the criterion concerning the conduct of an activity on behalf of an entity directly involved in nuclear proliferation, namely IRISL, or of the criterion concerning the assistance given to a designated entity in evading sanctions.
160 In that context, on the assumption that Great Ocean Shipping and Pacific Shipping were properly entered on the lists, the Court must examine whether the applicant was in a position to influence the unlawful activities alleged against those companies. It is evident from the reasons given in the contested measures that the fourth applicant had a long career in IRISL group companies, and that he simultaneously held managerial positions at Pacific Shipping and at Great Ocean Shipping. In addition, the fourth applicant was involved in the setting-up of a company, Crystal Shipping, that was owned by Pacific Shipping and which the Council regards as having been set up in order to circumvent the sanctions imposed on IRISL.
161 Therefore, at the time of the fourth applicant’s initial listing, all those elements amounted to a body of sufficiently precise and consistent evidence enabling the Council reasonably to conclude that the person concerned was involved in the alleged activities of Pacific Shipping and Great Ocean Shipping on behalf of IRISL. That involvement is borne out by the fact that the fourth applicant was also IRISL’s regional director in the United Arab Emirates.
162 In addition, the fact that the applicant was involved in the setting-up of Crystal Shipping with a view to circumventing the sanctions imposed on IRISL – if established – justified the applicant’s listing, on the basis of the criterion relating to the assistance given to an entity identified as being directly involved in nuclear proliferation in order to evade sanctions.
163 Those responsibilities of the fourth applicant within the IRISL group, allied to the fact that he retired following his initial listing on 1 December 2011, permitted the inference that his retirement was a fiction.
164 Consequently, in so far as, at the time when his listing was maintained in Annex IX to Regulation No 267/2012, the fourth applicant had shortly beforehand ceased to hold the position of managing director at Great Ocean Shipping and at Pacific Shipping, the Council was reasonably entitled to find that he had maintained his links with IRISL.
165 It follows from this that if IRISL’s listing, and that of the companies referred to in the grounds for listing the fourth applicant, had been justified, the fourth applicant’s listing would not have been vitiated by an error of assessment.
166 The amendment, by Decision 2013/270, of the grounds for listing the fourth applicant in Annex II to Decision 2010/413 (see paragraph 22 above) has no bearing on that assessment, since the Council merely clarified in that decision, as regards the reason for the initial listing of the person concerned relating to his position as regional director of IRISL in the United Arab Emirates, that he was that entity’s ‘former’ regional director in the United Arab Emirates.
– The listing of the fifth applicant
167 The reasons given for the disputed restrictive measures in respect of the fifth applicant, Mr Ghezelayagh, are as follows:
‘Chief Executive officer of EU-designated Lead Maritime which acts on behalf of HDSL in Singapore. Additionally CEO of EU-designated Asia Marine Network, which is IRISL’s regional office in Singapore.’
168 Lead Maritime has been listed since 26 July 2010 on the following grounds:
‘Leading Maritime Pte Ltd (a.k.a Leadmarine, a.k.a. Asia Marine Network Pte Ltd a.k.a. IRISL Asia Pte Ltd; a.k.a. Leadmaritime) … Leadmarine, acts on behalf of HDSL in Singapore. Previously known as Asia Marine Network Pte Ltd and IRISL Asia Pte Ltd, and acted on behalf of IRISL in Singapore.’
169 HDSL is listed on the following ground:
‘Acts on behalf of IRISL performing container operations using vessels owned by IRISL.’
170 It is thus evident from the grounds for listing the applicant, read in conjunction with the grounds for listing Lead Maritime and HDSL, that the applicant was listed because he was holding or had held the principal managerial position in the following companies:
– the applicant is the chief executive officer (CEO) of Lead Maritime, which was itself designated on 26 July 2010 for the following two reasons:
– Lead Maritime acted on behalf of HDSL, which acted on behalf of IRISL;
– Lead Maritime had previously acted, under the name of Asia Marine Network Pte Ltd, on behalf of IRISL in Singapore;
– the applicant is the CEO of Asia Marine Network Pte.
171 First of all, as regards his position as CEO of Asia Marine Network Pte, the fifth applicant indicates in his written statements that he had resigned from that position in April 2010, and the Council does not challenge his assertion.
172 Next, as regards his position as CEO of Lead Maritime, the fifth applicant explains that he held that position because of his knowledge of shipping and ships as a Master Mariner. Lead Maritime had carried out normal shipping agency business. In July 2011, the company’s Singaporean sole shareholder had terminated the company’s agency agreements with HDSL, SAPID and ROD. He was in the process, with the help of the fifth applicant, of liquidating Lead Maritime, whose activities had ended, after three months of contractual notice, in September 2011. Following his listing, the fifth applicant, who was 44 years old, had been unable to find a full-time job.
173 In response to a written question put by the Court, the fifth applicant stated that the percentage of Lead Maritime’s turnover with HDSL, SAPID Shipping, ROD and IRISL affiliates was 95% in 2009 and in 2010, and 85% in 2011.
174 At the hearing, the fifth applicant stated, without being contradicted by the Council, that since September 2011 he was no longer CEO of Lead Maritime.
175 The Council suggests that the fifth applicant’s expertise in the maritime field explains why he should not be allowed to offer services to IRISL, which is well known for a large number of infringements of international law, or to its subsidiaries or front companies, so as to put pressure on Iran through IRISL and its senior members.
176 It is necessary therefore to ascertain whether the fact that the fifth applicant was, until September 2011, CEO of Lead Maritime and that he had previously been CEO of Asia Marine Network Pte is sufficient to justify his initial listing on 1 December 2011 and the maintenance of that listing on 23 March 2012 by Regulation No 267/2012.
177 It must be noted in that regard that, on the assumption that Lead Maritime was properly entered on the lists because of its activity on behalf of IRISL (see paragraph 170 above), the fifth applicant could rightly be held responsible, in his capacity as CEO, for the unlawful activities alleged against that company in which he held the principal managerial position (see paragraph 110 above).
178 In those circumstances, in order to assess whether the listing of the fifth applicant by the contested measures was still justified several months after the activities of Lead Maritime had ended, it is necessary to take into account the fact that the person concerned was obliged, at the age of 44 as he indicates in the application, to relinquish the post of CEO of that company, owing to the cessation of activity and the liquidation of that company consequent on its inclusion in the lists on 26 July 2010. In that context, it could reasonably be inferred from the high-level responsibilities and the stability of the positions held by the fifth applicant within the IRISL group, as evidenced by the fact that he was, successively, CEO of Asia Marine Network Pte and then of Lead Maritime, that he had not ceased all activity on behalf of IRISL, at least not before the process of liquidating Lead Maritime was completed.
179 It follows from this that if the listing of IRISL and of the companies referred to in the grounds for listing the fifth applicant had been justified, the fifth applicant’s listing would not have been vitiated by an error of assessment.
– The listing of the sixth applicant
180 The reasons given for the disputed restrictive measures in respect of the sixth applicant, Mr Golparvar, are as follows:
‘Former commercial manager of IRISL, deputy Managing Director and shareholder of the Rahbaran Omid Darya Shipmanagement Company, Executive Director and shareholder of the Sapid Shipping Company, a subsidiary of EU-sanctioned IRISL, deputy Managing Director and shareholder of HDSL, member of the board of directors of the EU-sanctioned Irano-Hind Shipping Company.’
181 The entry of the sixth applicant on the lists is thus based on five grounds, relating to the following positions held by him:
– former commercial manager of IRISL;
– executive director and shareholder of SAPID Shipping, a subsidiary of IRISL, which is subject to European Union sanctions;
– deputy managing director and shareholder of Rahbaran Omid Darya Shipmanagement;
– deputy managing director and shareholder of HDSL;
– member of the board of directors of Irano-Hind-Shipping Co., which is subject to European Union sanctions.
182 As a preliminary point, it is necessary to examine the sixth applicant’s arguments concerning the factual inaccuracy of some of the Council’s claims in those grounds.
183 First of all, as regards the last three reasons given for his listing, as set out in paragraph 181 above, the sixth applicant explains that he is not deputy managing director of Rahbaran Omid Darya Shipmanagement or a member of the board of directors of Irano-Hind Shipping. Nor is he deputy managing director of HDSL, but a non-executive director of that company.
184 Since the Council does not challenge those assertions, the claims contained in the last three grounds must be considered to be vitiated by errors of fact.
185 Next, with regard to the second ground mentioned above, the sixth applicant states that he is the managing director of SAPID, not executive director, which the Council does not dispute. He also states, without being contradicted by the Council, that SAPID is not a subsidiary of IRISL. In that regard, it should moreover be noted that SAPID was listed on the following ground: ‘Acts on behalf of IRISL performing bulk services’.
186 In the light of those preliminary findings and the grounds for listing the sixth applicant set out in paragraph 181 above, it is therefore necessary to examine whether the following positions held by the sixth applicant within IRISL and the three companies designated as acting on behalf of IRISL, as set out in the grounds for listing those companies, justified the listing of the sixth applicant:
– former commercial manager of IRISL;
– managing director of SAPID;
– shareholder of SAPID, HDSL and Rahbaran Omid Darya Shipmanagement;
– non-executive director of HDSL.
187 The Court must consider whether the sixth applicant could be regarded, on account of those positions, as being personally involved in the unlawful activities alleged against SAPID, or against HDSL or Rahbaran Omid Darya Shipmanagement, on the assumption that those companies had been properly identified as acting on behalf of IRISL (see paragraphs 108 and 110 above).
188 The sixth applicant maintains that SAPID Shipping is a shipping company independent of IRISL, transporting bulk cargo such as grains, sugar, soya, nickel and other minerals. The quantity and quality of the cargo is declared by the shipper, and the master of the ship controls it. SAPID Shipping would issue a bill of lading stating, in accordance with the custom of the trade, ‘quality and quantity of cargo as per shipper statement’. The sixth applicant would not be aware of the content of the cargo and had never knowingly participated in or facilitated the transport of illicit goods.
189 The Council takes the view that, as managing director of SAPID Shipping, the sixth applicant is responsible for what his company does, namely certifying the quality and quantity of the cargo. However, the Council admitted that it was unable to specify the sixth applicant’s exact hierarchical position within SAPID (see paragraph 112 above).
190 Nor, it must also be noted in that regard, can the sixth applicant’s hierarchical position within the structure of SAPID be established from the applicant’s answers to the questions put by the Court at the hearing. Nevertheless, the Council is not claiming that the sixth applicant held the principal managerial position in that company.
191 However, it must be held that the position of commercial manager of IRISL previously held by the sixth applicant, the fact that he was simultaneously holding important positions within two companies allegedly linked to IRISL, as managing director of SAPID Shipping and non-executive director of HDSL, and the fact that he was a shareholder of three companies directly or indirectly linked to IRISL, amounted to a body of precise and consistent evidence which proved that the applicant was, if necessary, capable of influencing the alleged unlawful activities of SAPID Shipping.
192 By contrast, in the absence of any indication of the nature of the positions which the sixth applicant held at HDSL or of his share in the capital of HDSL and of Rahbaran Omid Darya Shipmanagement, the Council has not established that the person concerned was involved in the alleged activities of those two companies on behalf of IRISL.
193 Consequently, it must be held that the sixth applicant could reasonably have been regarded as being involved in the activities of which SAPID Shipping is accused, according to the relevant legal criteria (see paragraph 110 above), if the listing of the three companies mentioned above, linked to that entity, had been well founded.
194 It follows from this that if the listing of IRISL and of the companies linked to it were justified, the sixth applicant’s listing would not be vitiated by an error of assessment or by an infringement of the relevant legal criteria.
– The listing of the seventh applicant
195 The reasons given for the disputed restrictive measures in respect of the seventh applicant, Mr Zadeh, are as follows:
‘Managing Director and shareholder of EU-sanctioned Hafiz Darya Shipping Lines (HDSL). Registered shareholder of several IRISL front companies.’
196 It is evident from the grounds for listing HDSL that HDSL was identified as acting on behalf of IRISL because it was performing container operations using vessels owned by IRISL.
197 The listing of the seventh applicant is thus based on two grounds, relating to the following positions held by the person concerned:
– managing director and shareholder of HDSL, designated as acting on behalf of IRISL;
– shareholder of several IRISL front companies.
198 With regard to the second of those grounds, it is sufficient to note that the reference to the status of shareholder of front companies does not meet the requirements linked to the obligation to state reasons and cannot, therefore, be taken into account for the purpose of assessing whether the applicant’s listing is well founded (see paragraphs 61 and 64 above).
199 It is necessary, therefore, to ascertain whether the first ground for listing the applicant, relating to his position at HDSL, is capable of justifying that listing. The seventh applicant disputes any personal involvement in unlawful activities.
200 The seventh applicant claims that, in his position as managing director of HDSL, he carries out managerial duties according to the directions of the board. He deals with financial matters and contacts with HDSL’s major customers.
201 The Council merely invokes the seventh applicant’s position as managing director. It does not dispute that the seventh applicant held a subordinate post, and that HDSL’s principal managerial post holder was not subject to restrictive measures. The Council thus does not put forward any evidence from which it might be inferred that, in holding the position of managing director, the seventh applicant was capable of influencing HDSL’s alleged activity on behalf of IRISL.
202 Furthermore, in the absence of any details regarding the share in the capital of HDSL held by the seventh applicant, it cannot be presumed from the mere fact that he was a shareholder of that company that he was involved in the unlawful activities of which the company is accused.
203 Consequently, even if HDSL’s listing was justified, the seventh applicant could not be deemed to be acting on behalf of IRISL, in his capacity as managing director and shareholder of HDSL.
204 For all those reasons, the listing of the seventh applicant is in any event unjustified, irrespective of the question whether or not IRISL was properly identified as being directly involved in nuclear proliferation.
205 It follows from this that the listing of the seventh applicant is in any event vitiated by an error of assessment.
– The listing of the eighth applicant
206 The reasons given for the disputed restrictive measures in respect of the eighth applicant, Mr Pajand, in Decision 2011/783 and, consequently, in Annex II to Decision 2010/413 are as follows:
‘Former Financial Director of IRISL, former Deputy Managing Director of EU-sanctioned Irinvestship Limited, Managing Director of Fairway Shipping which took over Irinvestship Limited. Director of IRISL front companies, including EU-sanctioned Lancelin Shipping Company and Acena Shipping Company.’
207 Those grounds are reproduced in similar terms by Implementing Regulation No 1245/2011 and, therefore, in Annex VIII to Regulation No 961/2010. They are also essentially reproduced in Annex IX to Regulation No 267/2012.
208 The eighth applicant submits that he has ceased to hold the positions to which the grounds for his listing refer. He explains that from 1987 he held various finance and accounting positions within IRISL. From 1992 to January 2008, he was deputy director of finance of IRISL. In 2008, he held the position of managing director of the shipping agency Irinvestship Ltd, a company in the IRISL group. He had resigned from that position shortly after sanctions were adopted against that company by the United States in September 2008. He had then been appointed director of Fairway Shipping, a private shipping agency established in London in March 2008. The eighth applicant does not dispute that that company took over Irinvestship’s business. Furthermore, in 2010, the eighth applicant had resigned – before the adoption on 23 May and 1 December 2011 of sanctions against those companies – from the positions of director of Lancelin Shipping and of Acena Shipping, established in 2002 for the purpose of obtaining loans from banks in Germany. At the hearing the eighth applicant stated that, in March 2012, his position with Fairway Shipping had come to an end and he had retired.
209 The Council does not dispute those assertions. It emphasises the eighth applicant’s long career in IRISL and the fact that he does not deny the links between Fairway Shipping and IRISL. It claims that the eighth applicant played an important role in financing IRISL’s operations through loans obtained in Germany.
210 It is thus evident from the statement of reasons in the contested measures and the parties’ arguments that the listing of the eighth applicant is based on four grounds, relating to the following positions held by him:
– former deputy financial director of IRISL;
– former managing director of Irinvestship, which is subject to European Union sanctions;
– director of Fairway Shipping, which took over Irinvestship’s business;
– director of IRISL front companies, in particular Lancelin Shipping and Acena Shipping, until 2010.
211 In that regard, it should be noted at the outset that the eighth applicant had a long career as a senior member within IRISL. Furthermore, he was appointed to a succession of directorships of several companies belonging to IRISL. Lastly, when his name was added to the lists, he was still director of one of them.
212 Although the grounds put forward by the Council to justify the listing of the eighth applicant and of the four companies in question do not identify the specific actions of which the Council accuses the eighth applicant, they show that he simultaneously held a number of directorships in companies linked to IRISL, and that, by regularly calling upon the eighth applicant to take up management posts, IRISL was placing particular confidence in the eighth applicant personally.
213 It follows from this that if the listing of IRISL and of the companies linked to IRISL should prove to be justified, the listing of the eighth applicant would not be vitiated by an error of assessment.
– The listing of the ninth applicant
214 The reasons given for the initial entry of the ninth applicant, Mr Sarkandi, in Annex II to Decision 2010/413 by Decision 2011/783, and in Annex VIII to Regulation No 961/2010 by Implementing Regulation No 1245/2011, and then for maintaining his listing in Annex IX to Regulation No 267/2012, are as follows:
‘Financial Director of IRISL since 2011. Formerly executive director of several EU-sanctioned IRISL subsidiaries who set up several front companies in which he is still registered as Managing Director and shareholder.’
215 Mr Sarkandi states, without being contradicted by the Council, that until his retirement on 11 September 2011 he was ‘finance senior manager’ at IRISL, not ‘financial director’. At the hearing, the ninth applicant explained that he had had ‘middle management functions’ and that, as such, he had not been involved in decisions relating to IRISL’s financing policy.
216 It is thus evident from the statement of reasons for the entry of the ninth applicant on the lists, and the parties’ arguments summarised in paragraph 215 above, that the ninth applicant’s listing is based on three grounds, relating to the following positions or activities of the applicant:
– finance senior manager of IRISL until September 2011;
– former executive director of several IRISL subsidiaries;
– responsible for setting up several front companies in which he is still registered as managing director and shareholder.
217 It should be noted at the outset that, according to the case-law (see paragraph 34 above), the second of those grounds does not meet the requirement of an actual and specific statement of reasons, in so far as it does not enable the IRISL subsidiaries of which the ninth applicant was allegedly former executive director to be identified. That ground cannot, therefore, contribute to the justification of the ninth applicant’s listing.
218 As regards the third ground mentioned in paragraph 216 above, the ninth applicant explains that the alleged IRISL ‘front companies’ are single purpose companies. The ninth applicant had been appointed director of those companies when he was, until 2008, managing Irinvestship in the United Kingdom. In reply to a written question put by the Court, the ninth applicant stated that, when he was listed, he was still registered as director only of Ocean Capital Administration GmbH. That was a dormant company and the ninth applicant had requested that his name be removed from the directorship of that company. The ninth applicant’s name had already been removed from the directorships of the other companies.
219 The Council contends that the fact that the ninth applicant is or was the finance senior manager of IRISL, and also managing director of several German companies the purpose of which was to obtain financing for IRISL, shows that he provided assistance to IRISL by obtaining financing for it. The fact that the ninth applicant no longer holds those positions could be proof of the effectiveness of the sanctions imposed in his case.
220 That argument cannot be accepted. The third ground mentioned above does not identify the ‘front companies’ set up by the applicant and does not provide any indication of the actions of which those companies are accused. Therefore, that reason does not meet the requirements of the obligation to state reasons, as has already been found (see paragraphs 61 to 64 above).
221 It is necessary therefore to ascertain whether the first ground, referred to in paragraph 216 above, relating to the ninth applicant’s position as finance senior manager of IRISL, can by itself justify the applicant’s listing. In that regard, it is sufficient to note that the Council did not put forward any evidence from which it might be inferred that, despite having had only middle management functions within IRISL, the ninth applicant was none the less in a position to influence the alleged activity of that entity in connection with nuclear proliferation.
222 Consequently, in the absence of any evidence of the ninth applicant’s own involvement in activities having a direct or indirect link with nuclear proliferation, the ninth applicant cannot be presumed to have acted, prior to his retirement in September 2011, on behalf of or at the direction of IRISL, or to have assisted IRISL in evading sanctions, within the meaning of the relevant legislation.
223 In that context, at the time of the adoption of the contested measures, the ninth applicant’s former position as finance manager at IRISL was particularly unlikely to have justified his listing as he had retired on 11 September 2011, as is evident from the documents provided by the applicant. The Council did not put forward any evidence to suggest that there was a risk at that time that the person concerned was involved in activities of support for nuclear proliferation after his retirement.
224 The same conclusion must be drawn following the amendment by Decision 2013/270 of the grounds for the ninth applicant’s listing (see paragraph 7 above), in so far as the Council confined itself in that decision to amending the first of those grounds (see paragraph 216 above), by specifying that the person concerned was a ‘former’ financial director of IRISL.
225 Consequently, for those various reasons, in the light of the evidence properly relied on by the Council in the present case, the ninth applicant’s listing is in any event unjustified, irrespective of the question whether or not IRISL was properly identified as being directly involved in nuclear proliferation.
226 It follows from this that the listing of the ninth applicant is in any event vitiated by an error of assessment.
– The listing of the tenth applicant
227 The reasons given for the disputed restrictive measures in respect of the tenth applicant, Mr Sadat Rasool, are as follows:
‘Assistant Legal Director of IRISL group, Legal Director of Rahbaran Omid Darya Shipmanagement Company.’
228 The entry of the tenth applicant on the lists is thus based on two grounds, relating to the following positions held by him:
– assistant legal director of the IRISL group;
– legal director of Rahbaran Omid Darya Shipmanagement.
229 With regard to the second of those grounds, the tenth applicant maintains that he had no relationship with Rahbaran Omid Darya Shipmanagement. Since the Council does not dispute that assertion, it must be held that that second ground is vitiated by an error of fact.
230 To counter the first ground for his listing, the tenth applicant states that he is an independent lawyer enrolled at the Tehran Bar (Iran). He is retained under contract by IRISL, gives it legal advice, particularly on maritime law, and represents the company in courts and tribunals. He does not play any part in decision-making.
231 In reply to a written question put by the Court, the tenth applicant stated that his relationship with IRISL represented 17% of his turnover in 2009, 20% in 2010 and 16% in 2011. He had not undertaken any work with IRISL subsidiaries during that period.
232 The Council does not dispute those assertions. It takes the view, however, that the tenth applicant assisted IRISL by providing legal advice, even though the company was known for employing all possible means to evade sanctions. The fact that IRISL, its subsidiaries and front companies cooperated in joint ventures, changed names and used single purpose companies for financing on a global scale is a sign of the importance of that advice.
233 It is apparent from the factual details provided by the tenth applicant that he is an independent lawyer, for whom IRISL’s business represented less than 20% of his turnover. The grounds for listing the tenth applicant, relating to his alleged position as assistant legal director of IRISL and legal director of Rahbaran Omid Darya Shipmanagement, are therefore incorrect.
234 Consequently, the tenth applicant’s listing is in any event unjustified, irrespective of the question whether or not IRISL was properly identified as being directly involved in nuclear proliferation.
235 It follows from this that the listing of the tenth applicant is in any event vitiated by an error of fact and by an error of assessment.
– The listing of the eleventh applicant
236 The reasons given for the disputed restrictive measures in respect of the eleventh applicant, Mr Tafazoly, are as follows:
‘Managing Director of EU-sanctioned IRISL China Shipping Company, alias Santelines (a.k.a. Santexlines), alias Rice Shipping, alias E-Sail Shipping.’
237 It is thus necessary to ascertain whether the sole reason for entering the eleventh applicant on the lists, relating to his position as managing director of E-Sail Shipping, is capable of justifying his listing.
238 The eleventh applicant admits that he is, officially, the managing director of E-Sail Shipping. He claims that in practice, however, his position is that of a general manager of the company. E-Sail Shipping is a shipping agency that is wholly owned by IRISL and has around 20 employees. It provides services to a number of different shipping companies in addition to IRISL. Ordinarily, E-Sail Shipping would have no knowledge of the actual content of the cargo being shipped. It would only become aware of that content if it was directly declared by the shipper in cases of a dispute between the shipper and the buyer or master of the vessel. The eleventh applicant claims never to have knowingly participated in or facilitated the loading or carriage of illegal goods.
239 The Council states that, in so far as IRISL has often in the past used various manoeuvres to evade sanctions, it would be naive to believe that E-Sail Shipping – wholly owned by IRISL – has no knowledge of IRISL’s illegal activities and has not contributed to them. The role of general manager is to act at the direction of the shareholder, namely IRISL.
240 In that regard, it must be noted that the Council does not put forward any evidence from which it might be inferred that the eleventh applicant was able, owing to his position as managing director of E-Sail Shipping, to influence the decisions of that company in relation to the alleged assistance given to IRISL in evading sanctions.
241 Consequently, the eleventh applicant’s listing is in any event unjustified, irrespective of the question whether or not IRISL was properly identified as being directly involved in nuclear proliferation.
242 It follows from this that the listing of the eleventh applicant is in any event vitiated by an error of assessment.
243 In the light of all the foregoing considerations, it must be concluded that the listing of the first, second, third, seventh, ninth, tenth and eleventh applicants is unfounded, irrespective of the question whether the listing of IRISL and of the companies considered and which are linked to that entity was justified.
244 Nevertheless, in view of the fact that IRISL’s listing is unfounded and that the listing of all the applicants is based on professional and capital links maintained, directly or indirectly, with IRISL (see paragraphs 3, 95 and 96 above), the contested measures must be annulled in so far as they concern all the applicants, and there is no need to examine the third and fourth pleas. The same is true of Decision 2013/270 in so far as it concerns Mr Fard and Mr Sarkandi (see paragraphs 166 and 223 above).
Temporal effects of annulment of the contested measures
245 With regard to the temporal effects of the annulment of the contested measures, it must be noted that Regulation No 961/2010, as amended by Implementing Regulation No 1245/2011, was repealed and replaced by Regulation No 267/2012. It follows from this that Implementing Regulation No 1245/2011 ceased to have legal effect after Regulation No 961/2010 was repealed. Consequently, the annulment of Implementing Regulation No 1245/2011 concerns only the effects which it produced between its entry into force and its repeal (see, to that effect, Case T‑509/10 Manufacturing Support & Procurement Kala Naft v Council [2012] ECR I‑0000, paragraph 128).
246 As regards Regulation No 267/2012, it must be noted that, under the second paragraph of Article 60 of the Statute of the Court of Justice of the European Union, by way of derogation from Article 280 TFEU, decisions of the General Court declaring a regulation to be void are to take effect only as from the date of expiry of the period for bringing an appeal referred to in the first paragraph of Article 56 of that Statute or, if an appeal has been brought within that period, as from the date of dismissal of the appeal.
247 Regulation No 267/2012, including Annex IX thereto, is of the nature of a regulation, since the second paragraph of Article 51 thereof provides that it is to be binding in its entirety and directly applicable in all Member States, which corresponds to the effects of a regulation as provided for in Article 288 TFEU (see, to that effect, Case C‑548/09 Bank Melli Iran v Council, paragraph 45).
248 With regard to Decision 2010/413, it must be noted that the annulment of Decision 2011/783 and of Decision 2013/270, in so far as they concern the applicants, would result in the immediate disappearance of the applicants’ listing from Annex II to Decision 2010/413.
249 Under the second paragraph of Article 264 TFEU, the Court may, if it considers it necessary, state which of the effects of the act which it has declared void are to be considered as definitive.
250 In the present case, if the dates when the annulment in part of Regulation No 267/2012 and that of Decision 2011/783 and of Decision 2013/270 take effect were to differ, that would be likely seriously to jeopardise legal certainty, since those acts provide for measures which are identical.
251 The effects of Decision 2011/783 and of Decision 2013/270 must therefore be maintained as regards the applicants until the annulment in part of Regulation No 267/2012 takes effect (see, by analogy, Case T‑15/11 Sina Bank v Council [2012] ECR I‑0000, paragraph 89).
Costs
252 Article 87(2) of the Rules of Procedure provides that 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 essentially been unsuccessful, it must be ordered to pay the costs of the present proceedings, in accordance with the form of order sought by the applicants.
On those grounds,
THE GENERAL COURT (Fourth Chamber)
hereby:
1. Annuls Council Decision 2011/783/CFSP of 1 December 2011 amending Decision 2010/413/CFSP concerning restrictive measures against Iran, in so far as it listed the names of Mr Ghasem Nabipour, Mr Mansour Eslami, Mr Mohamad Talai, Mr Mohammad Moghaddami Fard, Mr Alireza Ghezelayagh, Mr Gholam Hossein Golparvar, Mr Hassan Jalil Zadeh, Mr Mohammad Hadi Pajand, Mr Ahmad Sarkandi, Mr Seyed Alaeddin Sadat Rasool and Mr Ahmad Tafazoly 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;
2. Annuls Council Implementing Regulation (EU) No 1245/2011 of 1 December 2011 implementing Regulation (EU) No 961/2010 on restrictive measures against Iran, in so far as it listed the names of Mr Nabipour, Mr Eslami, Mr Talai, Mr Fard, Mr Ghezelayagh, Mr Golparvar, Mr Zadeh, Mr Pajand, Mr Sarkandi, Mr Sadat Rasool and Mr Tafazoly in Annex VIII to Council Regulation (EU) No 961/2010 of 25 October 2010 on restrictive measures against Iran and repealing Regulation (EC) No 423/2007;
3. Annuls Annex IX to Council Regulation (EU) No 267/2012 of 23 March 2012 concerning restrictive measures against Iran and repealing Regulation No 961/2010, in so far as it concerns Mr Nabipour, Mr Eslami, Mr Talai, Mr Fard, Mr Ghezelayagh, Mr Golparvar, Mr Zadeh, Mr Pajand, Mr Sarkandi, Mr Sadat Rasool and Mr Tafazoly;
4. Annuls Council Decision 2013/270/CFSP of 6 June 2013 amending Decision 2010/413 in so far as it concerns Mr Fard and Mr Sarkandi;
5. Orders the effects of Decision 2011/783 and of Decision 2013/270 to be maintained as regards Mr Nabipour, Mr Eslami, Mr Talai, Mr Fard, Mr Ghezelayagh, Mr Golparvar, Mr Zadeh, Mr Pajand, Mr Sarkandi, Mr Sadat Rasool and Mr Tafazoly from their entry into force until the annulment in part of Regulation No 267/2012 takes effect;
6. Dismisses the action as to the remainder;
7. Orders the Council of the European Union to bear its own costs and to pay those incurred by Mr Nabipour, Mr Eslami, Mr Talai, Mr Fard, Mr Ghezelayagh, Mr Golparvar, Mr Zadeh, Mr Pajand, Mr Sarkandi, Mr Sadat Rasool and Mr Tafazoly.
Papasavvas | Van der Woude | Buttigieg |
Delivered in open court in Luxembourg on 12 December 2013.
[Signatures]
Table of contents
Background to the dispute
Procedure and forms of order sought
Law
1. Admissibility of the second head of claim
2. Admissibility of the request to amend the form of order sought
3. Substance
First plea, alleging infringement of the obligation to state reasons
Preliminary observations on the obligation to state reasons in regard to restrictive measures
The alleged lack of clarity of the contested decision as regards the adoption of restrictions on admission in respect of the applicants
The statement of reasons relating to the legal basis of the applicants’ listing
The actual and specific statement of reasons for the applicants’ listing
The reference to ‘front companies’ in the grounds for listing the applicants
Second plea, alleging error of assessment and infringement of the relevant legal criteria
The evidence that may properly be relied on by the Council
The effect of the judgment in Islamic Republic of Iran Shipping Lines and Others v Council on the present case
The applicants’ own involvement in the activities to which the relevant legal criteria relate
– The listing of the first applicant
– The listing of the second applicant
– The listing of the third applicant
– The listing of the fourth applicant
– The listing of the fifth applicant
– The listing of the sixth applicant
– The listing of the seventh applicant
– The listing of the eighth applicant
– The listing of the ninth applicant
– The listing of the tenth applicant
– The listing of the eleventh applicant
Temporal effects of annulment of the contested measures
Costs