Economy, Business And Markets

EU Court Annuls Some Sanctions

EU Court Annuls Some SanctionsEU Court Annuls Some Sanctions

The European Union’s second-highest court struck down sanctions Thursday on a leading Iranian bank and a string of Iranian shipping companies hit with asset freezes as part of pressure on Tehran over its nuclear energy program, although judges gave the EU more than two months to respond before the decisions take effect, Reuters reported.

But they will remain under sanctions for now after the General Court gave the EU time to appeal or to decide whether to re-impose sanctions using different legal grounds.

The court's rulings were handed down as six major powers and Iran strive to meet an end-June deadline for a long-term agreement to curb Tehran's nuclear activities in exchange for lifting of economic sanctions.

The EU put Bank Tejarat, an Iranian commercial bank, under sanctions in 2012, saying it had helped the country's nuclear efforts.

The General Court struck down the sanctions, saying the Council of EU governments had failed to prove that Bank Tejarat had provided support for the nuclear program or had helped others to circumvent sanctions. It also said the bank was partially privatized in 2009 and the Iranian state was no longer its majority shareholder.

The court ruled Thursday that the EU had failed to detail what it says was confidential evidence of the bank’s activities. EU member states have repeatedly refrained from detailing what is sometimes sensitive intelligence information, because the court’s rules mean the evidence must be shared with the lawyers challenging the sanctions, the Wall Street Journal wrote.

EU member states are considering changes to those rules, proposed by the court, which would allow some evidence to be presented confidentially.

Shipping Firms

The General Court also struck down EU sanctions on 40 shipping companies, including Hamburg-based Ocean Capital Administration GmbH, according to Reuters.

The companies were placed on the EU sanctions list because it said they were controlled or otherwise linked to Islamic Republic of Iran Shipping Lines, which had previously been put under sanctions.

The court found that at the time the 40 companies were placed on the sanctions list the EU had not given valid reasons for saying that Islamic Republic of Iran Shipping Lines was supporting the nuclear program. It therefore annulled the sanctions against the 40 companies but again gave the EU time either to appeal or to reinstate the sanctions using new legal grounds.

Various IRISL subsidiaries were in the 40 delisted shipping firms, including IRISL Maritime Training Institute, Kish Shipping Line Manning Co. and IRISL Multimodal Transport Co. The court accepted the firms’ argument that since it had struck down sanctions against IRISL, the subsidiaries should also be delisted, the Journal reported.

There was no immediate comment from the European Council, the body representing EU member states which makes sanctions decisions, both Reuters and WSJ said.

The court gave the EU two months and 10 days to relist the firms or challenge the decision. The EU has already placed IRISL back on its sanctions list, citing new legal grounds.

The decisions were the latest in a number of legal reverses the EU has suffered over the validity of its sanctions. It has responded to similar court decisions by relisting Iranian companies using different criteria.

Iran is currently in negotiations with the US, Russia, China and three EU member states on a comprehensive nuclear deal, which would lift sanctions in exchange for Tehran addressing international concerns over its nuclear energy program. The talks, already extended twice, are due to conclude on June 30.