Home Economics EU’s Highest Court Upholds Sanctions Against Russia’s Rosneft

EU’s Highest Court Upholds Sanctions Against Russia’s Rosneft

68
SHARE


Authored by Tsvetana Paraskova via OilPrice.com,

The European Court of Justice, Europe’s top court, on Tuesday ruled that sanctions imposed by the UK and the EU on Russia’s oil giant Rosneft are valid, in a ruling that also asserts the court’s jurisdiction over the common policy of the European Union (EU).

The EU imposed sanctions on Russia in 2014 over Moscow’s annexation of Crimea, with economic sanctions slapped in July 2014 and reinforced in September 2014, including against certain Russian companies that include Rosneft.

Rosneft had challenged before the High Court of Justice (England & Wales) the validity, in the light of EU law, of the restrictive measures imposed by the European Council on it and the implementing measures adopted by the United Kingdom that are based on the Council acts. The European Court of Justice was asked to rule, in essence, if the acts of the Council and the United Kingdom are valid.

In its ruling published today, the court said that “The restrictive measures adopted by the Council in response to the crisis in Ukraine against certain Russian undertakings, including Rosneft, are valid.”

“The Court holds that the importance of the objectives pursued by the contested acts is such as to justify certain operators being adversely affected. Having regard to the fact that the restrictive measures adopted by the Council in reaction to the crisis in Ukraine have become progressively more severe, interference with Rosneft’s freedom to conduct a business and its right to property cannot be considered to be disproportionate,” the court said.

Following the court ruling, Rosneft issued a statement in which it said it was disappointed by the ruling, and that it considers the court decision illegal, groundless and politicized”.

The Court refused to admit that the EU sanctions were imposed, in particular, to achieve hidden purposes and are, in fact, an instrument of competitive struggle. Nevertheless, the Court could not explain why the limitations, applied under the pretext of Crimea’s accession to Russia, involve access of oil companies to international financial markets, oil production at the Arctic shelf, development of tight reserves, deep-water and shale fields. The Company considers that the sanctions imposed against it by the EU states are primarily aimed at increasing risks of busines operations, obstructing implementation of Rosneft’s important projects and thus creating preferences for other oil market players.

 

The Court ignored its own existing precedents when the decision on EU sanctions was revised by the same court due to lack of substantial evidence. For instance Iranian banks included in the EU sanctions list successfully appealed the EU regulation. The Court stated that they are not related to the nuclear program of the IRI that was the object of sanctions and the existence of the close ties to the government is not a satisfactory argument for including them in the list.

 

The Court refused to acknowledge that unilateral economic sanctions restrict trade by definition and contradict existing provisions of the Partnership and Cooperation Agreement (PCA) between Russia and the EU, signed in 1994. The EU’s decision to impose the sanctions is, in fact, a legitimated refusal to fulfill its obligations under international law.

This decision proves that in Europe the rule of law is being substituted with the rule of politics,” said Rosneft, whose chief executive Igor Sechin is a close ally of Vladimir Putin.



Source link