The judgment of the General Court of the European Union in Case T-232/24 of 24 January 2026 (Euro Asia Cargo Private Ltd v Council of the European Union) concerns the restrictive measures (sanctions) adopted by the European Union in response to Russia’s actions aimed at destabilising Ukraine. On 24 February 2024, the applicant was added to the Council of the EU’s sanctions lists (Annex IV to Decision 2014/512/CFSP and Regulation (EU) No 833/2014).
The Council based the listing on the allegation that, following the invasion of Ukraine, the applicant had, acting as an intermediary, facilitated the transport of antennas (of EU origin) to Russian entities. These antennas are used in Russian “Kometa” modules, which are deployed militarily in Russian “Geran-2” drones (UAVs) in Ukraine.
The applicant sought the annulment (Article 263 TFEU) of the Council’s legal acts by which it had been added to, and kept on, the sanctions lists.
A listing under Annex IV to Decision 2014/512/CFSP and Regulation (EU) No 833/2014 constitutes one of many means by which the EU seeks to weaken Russia’s military-industrial complex in the context of its war of aggression against Ukraine. Although a listing under Annex IV falls short, in its effects, of the extensively politically debated asset freezes and prohibitions on making funds available (for example, Article 2 of Regulation (EU) No 269/2014), it entails a far-reaching export ban, circumvention of which is not only a criminal offence but is also punishable by imprisonment.
It is all the more significant, therefore, when the General Court takes a position on the lawfulness of a listing under Annex IV.
The applicant argued that there had been a violation of the right to good administration. It submitted, first, that the duty to state reasons (Article 296 TFEU and Article 41(2)(c) of the Charter of Fundamental Rights) had been breached, and, second, that the right to be heard (Article 41(2)(a) of the Charter of Fundamental Rights) had been infringed. The applicant pointed to the absence of any factual and specific grounds for its listing, arguing that only general grounds had been given, applicable equally to several listed companies.
The standard applicable to the statement of reasons is to be assessed in light of the context of the well-known international tensions. The stated objective of the sanctions in general is to increase the costs of the actions taken by the Russian Federation that undermine the territorial integrity, sovereignty, and independence of Ukraine, and to promote a peaceful resolution of the crisis. The applicant, the Court found, satisfied these criteria, in particular through its support in the form of electronic components for Russia’s military-industrial complex.
The judgment makes clear that the same considerations and wording may be relied upon repeatedly to adopt restrictive measures against several persons, and that this does not mean such considerations cannot, at the same time, constitute a sufficiently specific statement of reasons in respect of each of the persons concerned.
As regards the right to be heard, the Court found that, in the case of an initial listing, a prior hearing is not required. This is justified by the need to preserve an element of surprise, in order to ensure the immediate effectiveness of the restrictive measures and to prevent potential attempts at circumvention.
The Court further clarifies that, for the imposition of restrictive measures, the purely objective fact that a company facilitated the transport of such goods to Russian end users is sufficient. The relevant sanctions provisions do not expressly require any intentional or knowing conduct on the part of the applicant. Nor must the support provided cross any particular quantitative or qualitative threshold of significance in order to be lawfully classified by the Council as indirect support for the Russian military.
Should you or your business relationships be affected by sector-specific listings under the Russia embargo, or under other embargo regimes, it should be noted that the EU’s broad scope for action in making listings has once again been confirmed.
It is all the more important, therefore, to establish a broadly based compliance system capable of demonstrating, at an early stage and reliably, whether contacts with listed entities, or the risk of one’s own listing, are at issue.
We would be glad to assist you in establishing or updating a comprehensive, legally compliant compliance system, with particular attention to embargo provisions.
