On 18 September 2014, the General Court of the EU (the “General Court”) ruled that it was unlawful to include the Central Bank of Iran (the “Central Bank”) in the EU’s sanctions regime against Iran related to proliferation-sensitive nuclear activities and the development of nuclear weapon delivery systems. The Central Bank sought an annulment on the grounds that the Council of the EU  breached its obligation to state reasons for listing the Central Bank. The General Court annulled Council Regulation (EU) No 267/2012 and repealed Regulation (EU) No 961/2010 insofar as the regulations subjected the Central Bank to an asset freeze.

The Central Bank was initially listed for involvement in activities to circumvent sanctions and for providing financial support to the government of Iran. With regard to the first reason, the General Court held that this was too vague, providing no clear indication of the allegations against the Central Bank. The General Court stated that the Council of the EU had provided “no details of the names of persons, entities or bodies, listed on a list imposing restrictive measures, whom the applicant assisted in circumventing sanctions or of when, where and how that assistance took place”. Nor did the Council refer to any identifiable transaction or particular assistance. The General Court declined to provide judgment on whether the second reason was lawful.

Financial Times News Article (subscription required)

Case T-262/12 Central Bank of Iran v Council of the European Union [2014]

Council Regulation (EU) No 267/2012

Council Regulation (EU) No 961/2010