The Court of Justice of the European Union (CJEU) is scheduled to hear billionaire Petr Aven’s application on the 11th of December on the baselessness of his continued inclusion in the European Union (EU) sanctions list, the Latvian Ministry of Justice confirmed to LETA.
Aven’s lawyer, Aaron Bass, told LETA that the billionaire was challenging the 2023 and 2024 sanctions decisions in another case, separately from the one heard by the CJEU at the beginning of this year.
He points out that Aven won a court ruling at the beginning of this year with the judgment that Aven’s inclusion in the EU list in February 2022 and its subsequent review were unjustified, however, the EU reviews its list every six months. Aven therefore brought a new action alleging that it is unlawful and unjustified to keep his name on the EU sanctions list.
According to him, the new court proceedings make Latvia’s appeal against the first CJEU judgment completely pointless, as it concerns sanctions that have as a matter of fact lost their force at the beginning of 2023.
It has already been reported that the State has appealed against the court’s ruling rendered in Aven’s favour. The arguments have been approved by the Cabinet of Ministers and are currently regarded as restricted information, so the Ministry of Justice (MoJ) is not disclosing them.
Latvia was among EU member states that invited the EU Council to lodge an appeal, but the EU Council did not do so, as was recommended by the Legal Service of the EU Council and in line with the views of the majority of EU Member States.
Latvia is the only country to have lodged an appeal against the ruling. However, other Member States and EU institutions can intervene in support of one of the parties in appeal proceedings, the Ministry of Justice adds.
Bass pointed out that, as far as he knew, it had never happened before in sanctions cases that only one country appealed.
The lawyer also stressed that “no one is thinking for a second that the General Court of the EU is lax or tolerant towards those who have been sanctioned by the EU since the outbreak of the war”. In fact, all the appeals lodged since February 2022 by those subject to sanctions have been rejected.
Aven’s representatives have apparently succeeded in proving to the court “how unique his situation is and how baseless the EU Council’s accusations are”, calling the court’s decision to lift the sanctions “extremely well-reasoned both legally and factually”.
When asked whether Aven could claim compensation from Latvia should he win the appeal, Bass said that “in addition to recovering his legal costs, which he will absolutely seek, that would depend on sundry variables, but theoretically yes”.
The law provides that the losing party pays the costs of the proceedings, including the winning party’s costs, unless the court decides otherwise.
“In the vast majority of cases, the court orders the losing party to pay such costs, especially when the losing party is an EU institution or a Member State,” the lawyer explained, stressing that he saw no reason why this case should be any different.
The Ministry of Justice also previously confirmed to LETA that the CJEU does not decide on the recovery of compensation in appeal proceedings, but may decide on the recovery of legal costs, which depends on the outcome of the proceedings.
Aven’s lawyer did not give an exact amount, as the proceedings are still ongoing, but it could be as much as EUR 2 million.
Bass is one of the lawyers who signed the open letter to EU officials calling for the rule of law in sanctions proceedings. He says the EU Council does not respect the rule of law in reviewing sanctions and often ignores court decisions that declare them unlawful.
“We would like to underline with this letter that the Council is extending its powers by changing the terms of sanctions after the courts have overturned the original sanctions decisions and continues to sanction people on weak or unchanged evidence,” explained the lawyer.
According to him, this leads to sanctions being imposed on a permanent basis without regard for legal remedies, which is contrary to the principles of the rule of law.
As previously reported, the CJEU annulled the EU Council’s decision to impose sanctions on Aven and another billionaire, Mikhail Fridman, on the 28th of February 2022.
In its judgment, the CJEU held that none of the grounds specified in the original legal acts regarding sanctioning of Aven and Fridman was sufficiently substantiated and that their inclusion in the sanctions lists was therefore not justified. As regards their subsequent retention on the sanctions lists, the CJEU held that the EU Council had not provided any additional evidence compared to that on which it had initially relied.
Aven and Fridman are shareholders in Alfa Group. Alfa Bank, one of Russia’s largest banks, is part of this group.
The Court finds that, although the arguments put forward by the EU Council can be used to establish some kind of connection between Aven and Fridman and the Kremlin master Vladimir Putin or persons close to him, those arguments do not establish that they have supported actions or policies undermining or threatening the territorial integrity, sovereignty and independence of Ukraine, or that they have provided material or financial support to Russian officials responsible for the annexation of Crimea.
Aven’s representative, attorney at law Jānis Kārkliņš, previously told LETA that the imposition of sanctions at the beginning of the war was a justified political move, but that the sanctions policy needed to be improved to be more effective and targeted. In particular, it should be assessed whether the fact that the company in which Aven is a minority shareholder pays taxes in Russia means that he supports the war.
“If so, then all those Western companies operating in Russia are also supporting the annexation of Crimea and the destabilisation of Ukraine,” says the lawyer.
It has already been reported that the sanctions against Aven and Fridman are being renewed every six months and that they have the right to appeal against any such decision, but this has not been done so far.
Aven and Fridman are sanctioned by the US, the UK, the EU and other countries because these countries believe them to be close to the Russian dictator Putin and that they serve the Kremlin interests, including Russian aggression in Ukraine. Ukraine has also imposed its own sanctions on Fridman and Aven.
Aven also holds Latvian citizenship and has lived in Latvia with his family since the Russian invasion of Ukraine in 2022.