Terrorism

• Author: International Law Group
• Pages: 235-237

Page 235

On December 12, 2006, the Court of First Instance of the European Court of Justice held in the case of Organisation des Modjahedines du peuple d'Iran v. Council of the European Union that the Council improperly ordered the freezing of Plaintiff's funds.

The Organisation des Modjahedines du peuple d'Iran (People's Mujahidin of Iran) (OMPI) was established in 1965 to purportedly introduce democracy in Iran. It has an armed branch operating in Iran, but reportedly renounced all military activity in June 2001.

The basis for the freeze was a 2001 United Nations Security Council resolution requiring Member States to combat terrorism and its fi nancing by freezing terrorist funds. The European Union implemented that resolution through a common position and a regulation (Common Position 2001/931/CFSP, 2001 O.J. (L 344) 93; Council Regulation No. 2580/2001, 2001 O.J. (L 344) 70). Through Council decisions, there is a list ofPage 236 affected entities and individuals, including OMPI. OMPI brought action before the European Court of Justice, seeking to be removed from the list.

The Court of First Instance of the European Court of Justice finds that certain fundamental rights and safeguards, such as the right to a fair hearing, the obligation to state reasons for a decision, and the right of effective judicial protection, apply to a Community decision to freeze funds.

Here, the Security Council let the various Member State organizations decide which organizations and individuals should be affected. This involves the exercise of the Community's own powers. Under such circumstances, the Council must consider the fundamental rights guaranteed within the Community.

The Court distinguishes, however, the present case from the cases related to Osama bin Laden and Al-Qaeda, as well as the Taleban, which are Yusuf and Kadi (21 September 2005), and Ayadi and Hassan (12 July 2006). There, the Council had merely transposed United Nations Security Council Resolutions. The Community institutions did not have any discretion as to what entities and individuals should be affected.

The Court then defi nes the scope of rights under these circumstances, as well as the restrictions that may be imposed when the Community freezes funds. The right to a fair hearing does not require that the affected entities and persons be heard by the Council when the initial decision to freeze their funds is made.

"119. The right of the party concerned to a fair hearing must be...