In Case C-538/25, the Advocate General at the CJEU set out a comprehensive interpretation of the term “dual-use items” in Article 2(1) of Regulation (EU) 2021/821 in her Opinion. She opened with Nikita Khrushchev’s anecdote that trouser buttons are dual-use goods, because a soldier who had to hold up his trousers would only have one hand free to shoot. The anecdote illustrates how blurred the line between civilian and military goods is.
Facts
The applicant is an Austrian manufacturer of a training aircraft designed for pilot training in general aviation and for aerobatics. According to the findings of the referring Austrian court, the aircraft is neither specially designed for military purposes nor equipped with military components. Nor is it listed in Annex I to Regulation (EU) 2021/821.
The applicant applied for an export authorisation for several of these aircraft, which were to be delivered to a civilian trading company in Myanmar. According to the application, the end user was the Myanmar Air Force. The competent authority prohibited the export on the grounds that the goods would be used to train military pilots and could technically be converted for reconnaissance or surveillance flights. The applicant essentially argues that the aircraft was not designed for military purposes and that military conversion is impossible. The authority based the prohibition on human rights considerations, which under Article 9 of the Regulation may be taken into account for non-listed dual-use items.
The CJEU must clarify the following questionas:
The interpretation of the term “dual-use items” in Article 2(1) of the Regulation, in particular the criteria for identifying such items, namely that an item “can also be used for military purposes”.
Part (a) asks whether the item must contribute significantly to the capabilities of the armed forces, or whether it is sufficient that it serves to train military personnel where the basic training does not differ from that for civilian personnel.
Part (b) asks whether the military capabilities of the end user or consignee, the situation in the third country, the possibility of conversion and the risk of diversion must be taken into account, or whether only the condition of the item at the time of export matters.
Interpretation of the term “dual-use items”
The starting point is the definition in Article 2(1) of Regulation (EU) 2021/821, according to which dual-use items are items, including software and technology, which can be used for both civil and military purposes.
The Advocate General finds that the term “also for military purposes” must be interpreted broadly, even though the Regulation thereby constitutes an exception to the common principle of free exports. This is because the recitals of the Regulation place security concerns on an equal footing with free trade. Only a broad concept makes it possible to respond flexibly to changing strategic developments. The risk of unlimited controls is contained by the fact that restrictions under Article 9 are only permissible on grounds of security or human rights.
For part (a) of the question, it follows that an item does not have to contribute significantly to the capabilities of the armed forces. The Regulation sets no threshold. Any connection between the potential uses of the item and the armed forces of the third country is therefore sufficient. On that basis, suitability for the basic training of military pilots is enough, even if that training is the same as the training of civilian pilots.
For part (b), what matters is solely the objective suitability of the item based on its physical characteristics at the time of export. This follows from the wording (“can be used”), which does not require proof of the actual user or the specific use. The relevant characteristics include the objective possibility of conversion, but not the design intention or the intended use. The military capabilities of the end user and consignee, the situation in the third country, conversion and the risk of diversion are irrelevant to classifying an item as dual-use.
They only become relevant in a second step, when it comes to whether an authorisation can be required under Article 9 of Regulation (EU) 2021/821.
According to the Advocate General, the Court should therefore answer the first question referred as follows. For an item to be classified as usable “also for military purposes”, its suitability for training military pilots is sufficient, without any requirement of a significant contribution to the capabilities of the armed forces. What matters is solely the objective suitability of the item based on its physical characteristics at the time of export.
The judgment is still pending and is expected within the next six months. We will keep you informed of further developments in the proceedings.
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By: Julia Gnielinski
