Case C‑314/13

Užsienio reikalų ministerija

and

Finansinių nusikaltimų tyrimo tarnyba

v

Vladimir Peftiev and Others

(Request for a preliminary ruling from the Lietuvos vyriausiasis administracinis teismas)

‛Reference for preliminary rulings — Common foreign and security policy — Restrictive measures against Belarus — Freezing of funds and economic resources — Exceptions — Payment of professional fees associated with legal services — Discretion of the competent national authority — Right to effective judicial protection — Effect of unlawful origin of funds — None’

Summary — Judgment of the Court (Fifth Chamber), 12 June 2014

1. Common foreign and security policy — Restrictive measures against Belarus — Freezing of funds and economic resources — Request for exemption in order to have certain funds released so as to pay for legal services — Discretion of the competent national authority — Limits — Observance of the right to an effective judicial remedy

   (Charter of Fundamental Rights of the European Union, Art. 47, second para., 2nd sentence; Statute of the Court of Justice, Art. 19, third para.; Rules of Procedure of the General Court, Art. 43(1), first para.; Council Regulation No 765/2006, Art. 3(1)(b))

2. Common foreign and security policy — Restrictive measures against Belarus — Freezing of funds and economic resources — Request for exemption in order to have certain funds released so as to pay for legal services — Assessment by the national authority — Effect of unlawful origin of funds — None

   (Council Regulation No 765/2006, Art. 3(1)(b))

1.  Article 3(1)(b) of Regulation No 765/2006 concerning restrictive measures in respect of Belarus must be interpreted as meaning that, when taking a decision on whether to grant a derogation requested under that provision with a view to bringing an action challenging the lawfulness of restrictive measures imposed by the European Union, the competent national authority does not enjoy an absolute discretion, but must exercise its powers in a manner which upholds the rights provided for in the second sentence of the second paragraph of Article 47 of the Charter of Fundamental Rights of the European Union and observes the indispensable nature of legal representation in bringing such an action before the General Court of the European Union.

   A freeze of funds cannot have the effect of depriving the persons whose funds have been frozen from effective access to justice. However, in the exercise of its discretion the competent national authority may verify that the funds release of which is requested are intended exclusively for payment of reasonable professional fees and reimbursement of incurred expenses associated with the provision of legal services. It may also set the conditions it deems appropriate in order to guarantee, inter alia, that the objective of the sanction imposed is not frustrated and the derogation granted is not distorted.

   (see paras 26, 34, operative part 1)

2.  Article 3(1)(b) of Regulation No 765/2006 concerning restrictive measures in respect of Belarus must be interpreted as meaning that, in a situation in which a freezing of funds and economic resources is based on that regulation, a derogation from the freezing of funds and economic resources in order to pay for legal services must be appraised in accordance with that provision, which makes no reference to the origin of the funds or possible unlawful acquisition thereof.

   The purpose of that regulation is not to penalise unlawful acquisitions of funds, but rather to apply restrictive measures against persons responsible for infringements of international electoral standards at the time of the elections of 19 March 2006 in Belarus.

   (see paras 37, 40, operative part 2)

Case C‑314/13

Užsienio reikalų ministerija

and

Finansinių nusikaltimų tyrimo tarnyba

v

Vladimir Peftiev and Others

(Request for a preliminary ruling from the Lietuvos vyriausiasis administracinis teismas)

‛Reference for preliminary rulings — Common foreign and security policy — Restrictive measures against Belarus — Freezing of funds and economic resources — Exceptions — Payment of professional fees associated with legal services — Discretion of the competent national authority — Right to effective judicial protection — Effect of unlawful origin of funds — None’

Summary — Judgment of the Court (Fifth Chamber), 12 June 2014

1. Common foreign and security policy — Restrictive measures against Belarus — Freezing of funds and economic resources — Request for exemption in order to have certain funds released so as to pay for legal services — Discretion of the competent national authority — Limits — Observance of the right to an effective judicial remedy

   (Charter of Fundamental Rights of the European Union, Art. 47, second para., 2nd sentence; Statute of the Court of Justice, Art. 19, third para.; Rules of Procedure of the General Court, Art. 43(1), first para.; Council Regulation No 765/2006, Art. 3(1)(b))

2. Common foreign and security policy — Restrictive measures against Belarus — Freezing of funds and economic resources — Request for exemption in order to have certain funds released so as to pay for legal services — Assessment by the national authority — Effect of unlawful origin of funds — None

   (Council Regulation No 765/2006, Art. 3(1)(b))

1.  Article 3(1)(b) of Regulation No 765/2006 concerning restrictive measures in respect of Belarus must be interpreted as meaning that, when taking a decision on whether to grant a derogation requested under that provision with a view to bringing an action challenging the lawfulness of restrictive measures imposed by the European Union, the competent national authority does not enjoy an absolute discretion, but must exercise its powers in a manner which upholds the rights provided for in the second sentence of the second paragraph of Article 47 of the Charter of Fundamental Rights of the European Union and observes the indispensable nature of legal representation in bringing such an action before the General Court of the European Union.

   A freeze of funds cannot have the effect of depriving the persons whose funds have been frozen from effective access to justice. However, in the exercise of its discretion the competent national authority may verify that the funds release of which is requested are intended exclusively for payment of reasonable professional fees and reimbursement of incurred expenses associated with the provision of legal services. It may also set the conditions it deems appropriate in order to guarantee, inter alia, that the objective of the sanction imposed is not frustrated and the derogation granted is not distorted.

   (see paras 26, 34, operative part 1)

2.  Article 3(1)(b) of Regulation No 765/2006 concerning restrictive measures in respect of Belarus must be interpreted as meaning that, in a situation in which a freezing of funds and economic resources is based on that regulation, a derogation from the freezing of funds and economic resources in order to pay for legal services must be appraised in accordance with that provision, which makes no reference to the origin of the funds or possible unlawful acquisition thereof.

   The purpose of that regulation is not to penalise unlawful acquisitions of funds, but rather to apply restrictive measures against persons responsible for infringements of international electoral standards at the time of the elections of 19 March 2006 in Belarus.

   (see paras 37, 40, operative part 2)