The attacks on the World Trade Center in 2001 brought many changes to the legal landscape, of which three facets are perhaps most familiar to legal practitioners: criminal trials of suspected terrorists; control orders imposed on those suspected of terrorist activity; and the extradition of terrorist suspects to other countries, predominantly the US, to stand trial.
However, there is another legal aspect of ‘the war on terror’ that has received less attention, and that is the UN’s counter-terrorism sanctions regime, as implemented in the EU and UK. Only recently have challenges been mounted before both the European Court of Justice (ECJ) and domestic courts on the grounds that the regime provides insufficient due process protections. There have been interesting developments in the higher courts, of which anyone affected by the asset-freezing regime should be aware.
In the wake of the terrorist bombings of US embassies in Kenya and Tanzania in 1998, the UN Security Council (UNSC) adopted a number of resolutions to combat international terrorism. In these resolutions, adopted pursuant to chapter VII of the UN Charter, the UNSC defined international terrorism as a threat to international peace and security and imposed targeted sanctions against individuals, groups, undertakings and entities considered to be associated with Osama bin Laden, the al-Qaida network and the Taliban.
These resolutions provide that all UN member states must effectively implement three sanctions measures, namely: (a) to freeze the funds and other financial assets or economic resources of these individuals, groups, undertakings and entities; (b) to prevent the entry into, or transit through, their territories of these individuals; and (c) to prevent the direct or indirect supply, sale, or transfer to these individuals, groups, undertakings of arms and related material of all types including weapons and ammunition, military vehicles and so on.
The sanctions were adopted by the UNSC as preventive measures to fight international terrorism to maintain international peace and security. Since they were adopted under chapter VII of the UN Charter, they are binding upon all UN member states, who bear primary responsibility for their implementation and enforcement. It should be noted that member states’ obligations arising from these UNSC resolutions prevail over their obligations under any other international agreement.
The UNSC established the sanctions committee, composed of the members of the UNSC, and is also known as the al-Qaida and Taliban sanctions committee or the 1267 sanctions committee. The purpose of the committee is to oversee the implementation of these sanctions. The committee maintains a regularly updated list of designated individuals, groups, undertakings and entities (‘the consolidated list’) that serves as the foundation for the implementation and enforcement of sanctions.
The committee is authorised to consider proposals from UN member states to add the names of individuals, groups, undertakings, or entities to the consolidated list. It should be pointed out that there is no requirement that criminal charges be brought against targeted individuals or entities before or after their listing. Once listed, the designated individuals, groups, undertakings, or entities may submit a request for de-listing through their state of residence or citizenship. Alternatively, they may request their de-listing directly through the 'focal point' of the UN Secretariat.
The decision whether or not to remove a person from the consolidated list remains within the full discretion of the sanctions committee. The committee considers the de-listing requests by consensus in closed session. The objection of one member of the committee therefore prevents the removal of the petitioner’s name from the consolidated list. The committee, however, is not a judicial body – it is a political organ. In practice, the processing of de-listing requests is purely a matter of intergovernmental consultations among UN member states involved.
The procedure by which individuals come to have their assets frozen gives rise to serious concerns over due process and human rights. The listing procedure does not require the sanctions committee to give any reasons or any justification for its decision to put an individual or entity on the consolidated list. The committee is equally not obliged to give reasons for rejecting the de-listing requests. Therefore, listed individuals and entities potentially never find out why their names were proposed for the list and what convinced the committee to approve or reject the requests for the listing/de-listing. In the absence of the material and evidence relied upon by the committee, an individual or an entity is at an extreme disadvantage in terms of challenging their listing.
Even the most hardened supporter of counter-terrorist measures would have to concede that the placing of a person’s name on the UNSC list, with the consequent freezing of his assets and travel ban, is an extremely far-reaching measure, with profound consequences for the life and reputation of the persons whose assets are frozen. Most too would recognise that member states are fallible and that therefore the wrong people sometimes get listed (and indeed some states may list their political opponents in order to neutralise them). It is self-evident, therefore, that there should be a means of effectively challenging one’s listing.
Challenges have been made in the courts of both the EU and the UK by people whose assets have been frozen.
In a landmark decision, the ECJ held in the joint cases of Kadi and Al Barakaat (joined cases C-402/05 P and C-415/05 P, Yassin Abdullah Kadi and Al Barakaat International Foundation v Council and Commission (ECJ, 8 September, 2008), not yet reported), that the system under European Community (EC) law by which a listed person came to have his assets frozen was seriously flawed. The court found that freezing a person’s assets without informing them of the grounds for the decision, so that they can mount an effective challenge, breached the person’s right under EC law to a fair hearing and an effective judicial remedy. The court also found that, because there are no procedures whereby the targeted individuals or entities could successfully challenge the sanctions and put their case to the competent authorities, the freezing of the funds constitutes an unjustified restriction of the right to property (paras 369, 370 of C-402/05).
In the English courts too, the system by which the UN counter-terrorism regime has been implemented in English law has come under attack. The UK gave effect to decisions of the UNSC to combat terrorist activities by adopting orders in council, in particular the 2002 and 2006 Al-Qaida and Taliban (United Nation Measures) Orders. These orders enact a UK financial sanctions regime by providing, among other things, for the freezing of the assets of individuals and entities belonging to, or associated with, al-Qaida and the Taliban that are designated by the UN sanctions committee in the consolidated list.
In A, K, M, Q and G v HM Treasury  EWHC 869 (Admin), Mr Justice Collins struck down the 2006 order as being ultra vires. But on appeal the Court of Appeal (in A, K, M, Q and G v HM Treasury  EWCA Civ 1187) held that the order was not necessarily unlawful provided that a person whose assets were frozen pursuant to the order was given a merits-based review of the reasons for his listing. As Master of the Rolls Sir Anthony Clark stated in that case (para 191): ‘There must be procedures to enable him [the designated person], again so far as possible, to discover the case against him, so that he may have an opportunity to meet it. This may involve, as in the case of the TO [Terrorism (United Nations Measures) Order 2006], appropriate use of a special advocate. How the system will work in a particular case will depend upon the circumstances, as the House of Lords held is appropriate in the control order case in MB and AF. There may be greater difficulties in a case where HM Treasury knows nothing of the facts upon which the designation was made by the [sanctions] committee. I would leave the possible problems in such cases to be solved when they arise.’
The court anticipated that the remedy, should the court find, following its review, that the person should not have been listed, would be for the Foreign and Commonwealth Office (or the appropriate government department) to pursue a request for the person’s de-listing with the UNSC sanctions committee. However, even if the FCO supports the de-listing request, that does not automatically guarantee the approval of the petitioner’s de-listing by the committee, due to the diplomatic nature of the de-listing procedure as described above. The FCO would therefore need to convince all other members of the committee that the listing is unjustified.
The decision has gone on appeal to the House of Lords and will be the first case on the docket of the new Supreme Court, with hearings to be held in October. Watch this space.
John RWD Jones is a barrister at Doughty Street Chambers and Dr Miša Zgonec-Rožej is a legal consultant