Case C‑801/24 P
NKO AO National Settlement Depository (NSD)
v
Council of the European Union
Judgment of the Court (Fourth Chamber) of 11 June 2026
( Appeal – Restrictive measures taken in view of the military aggression against Ukraine – Decision 2014/145/CFSP – Article 2(1)(f) – Regulation (EU) No 269/2014 – Article 3(1)(f) – Freezing of funds and economic resources – Concept of ‘supporting, materially or financially, … the Government of the Russian Federation’ – Obligation to state reasons – Interpretation – Right to property – Limitations – Principle of proportionality – Account to be taken of the situation and economic interests of the appellant’s customers )
1. Acts of the institutions – Statement of reasons – Obligation – Scope – Restrictive measures adopted in view of the situation in Ukraine – Freezing of funds of certain persons and entities in view of the situation in Ukraine – Obligation to identify in the statement of reasons the specific and concrete elements justifying that measure – Decision falling within a context known to the person concerned, enabling him or her to understand the scope of the measure taken in respect of him or her
(Art. 296, second para., TFEU; Council Decision 2014/145/CFSP, as amended by Decisions (CFSP) 2022/883, (CFSP) 2023/572 and (CFSP) 2023/1767; Council Regulations No 269/2014, 2022/878, 2023/571 and 2023/1765)
(see paragraphs 42-51)
2. Common foreign and security policy – Restrictive measures adopted in view of the situation in Ukraine – Criteria for adopting restrictive measures – Material or financial support to the Russian Government – Concept of supporting, materially or financially – Concept of financial assistance – Concepts each having a different scope
(Council Decision 2014/145/CFSP, as amended by Decision (CFSP) 2022/329, Art. 2(1)(f); Council Regulations No 269/2014, No 833/2014, Arts 1(o), 3(1)(f) and 4(3)(b), and 2022/330)
(see paragraphs 71-76)
3. Common foreign and security policy – Restrictive measures adopted in view of the situation in Ukraine – Criteria for adopting restrictive measures – Material or financial support to the Russian Government – Concept of supporting, materially or financially – Requirement that support be quantitatively or qualitatively important – No need to establish a link between that support and the annexation of Crimea or the destabilisation of Ukraine – Central securities depositories – Included
(Council Decision 2014/145/CFSP, as amended by Decision (CFSP) 2022/329, Art. 2(1)(f); Council Regulations No 269/2014, Art. 3(1)(f), and 2022/330)
(see paragraphs 77-79)
4. European Union – Judicial review of the legality of the acts of the institutions – Restrictive measures adopted in view of the situation in Ukraine – Scope of the review – Proof that the measure is well founded – Obligation on the competent EU authority to establish, in the event of challenge, that the reasons relied on against the persons or entities concerned are well founded – Inclusion on the lists based on a specific, precise and consistent body of evidence – Meeting the standard of proof
(Charter of Fundamental Rights of the European Union, Art. 47; Council Decision 2014/145/CFSP, as amended by Decisions (CFSP) 2022/883, (CFSP) 2023/572 and (CFSP) 2023/1767; Council Regulations No 269/2014, 2022/878, 2023/571 and 2023/1765)
(see paragraphs 89-94)
5. Common foreign and security policy – Restrictive measures adopted in view of the situation in Ukraine – Criteria for adopting restrictive measures – Persons, entities or bodies supporting, materially or financially, or benefiting from the Government of the Russian Federation, and persons associated with them – Appropriateness of the restrictive measures – Restrictive measures pursuing a legitimate aim of the common foreign and security policy – Compliance with the principle of proportionality
(Art. 21 TEU; Council Decision 2014/145/CFSP, as amended by Decisions (CFSP) 2022/883, (CFSP) 2023/572 and (CFSP) 2023/1767, Art. 2(1)(f); Council Regulations No 269/2014, Art. 3(1)(f), 2022/878, 2023/571 and 2023/1765)
(see paragraphs 111, 128-132)
6. Member States – Obligations – Provision of remedies sufficient to ensure effective legal protection – Restrictive measures adopted in view of the situation in Ukraine – Respect for the right to property
(Art. 19(1), second para., TEU; Charter of Fundamental Rights of the European Union, Art. 17; Council Decision 2014/145/CFSP, as amended by Decisions (CFSP) 2022/883, (CFSP) 2023/572 and (CFSP) 2023/1767; Council Regulations No 269/2014, 2022/878, 2023/571 and 2023/1765)
(see paragraph 113)
7. Common foreign and security policy – Restrictive measures adopted in view of the situation in Ukraine – Freezing of funds of persons supporting, materially or financially, the Government of the Russian Federation – Application in derogation seeking the unblocking of certain funds – Discretion of the competent national authority – Limitations – Respect for fundamental rights – Payment due under a contract entered into before inclusion on the lists – Concept of payment – Return by a depository subject to fund-freezing measures of securities held with securities depositories established in the European Union – Included
(Charter of Fundamental Rights of the European Union, Arts 51(1) and 52; Council Decision 2014/145/CFSP, Art. 2(5); Council Regulation No 269/2014, Art. 6(1)
(see paragraphs 114-118)
8. Action for annulment – Jurisdiction of the EU judicature – Review of the lawfulness of an act adopted by a national authority in the implementation of derogations to measures for the freezing of funds – Not included
(Art. 263 TFEU)
(see paragraph 119)
Résumé
The Court of Justice dismisses the appeal brought by NKO AO National Settlement Depository (NSD) against the General Court’s judgment (1) concerning it. By that judgment, the General Court had dismissed that company’s action seeking annulment of the acts at issue (2) on the basis of which the Council of the European Union included and maintained its name on the lists of persons subject to restrictive measures taken in response to the actions of the Russian Federation undermining or threatening the territorial integrity, sovereignty and independence of Ukraine.
On this occasion the Court interprets for the first time the criterion laid down in Article 2(1)(f) of Decision 2014/145, as amended by Decision 2022/329, (3) and in Article 3(1)(f) of Regulation No 269/2014, as amended by Regulation 2022/330 (4) (‘the (f) criterion’), which provides for the freezing of all the funds and economic resources belonging to natural or legal persons, entities or bodies supporting, materially or financially, the Government of the Russian Federation.
In 2022, the funds and economic resources of the appellant, a company incorporated under Russian law, providing securities record-keeping and custody services as the central depository in Russia, were frozen on the basis of the (f) criterion.
In support of its appeal, the appellant claims that the General Court made several errors of law, alleging a failure to state reasons for the acts at issue, misinterpretation of the (f) criterion and breach of the principle of proportionality.
Findings of the Court
As regards, in the first place, the ground of appeal alleging an insufficient statement of reasons, the Court of Justice holds that, in view of the context in which the acts at issue were adopted and of the statement of reasons in those acts, the appellant, which describes itself in its own words in its appeal as an ‘important and central part of the Russian financial system’, could not reasonably have been unaware of the reasons why the Council adopted restrictive measures against it.
So far as concerns, in the second place, the ground of appeal alleging misinterpretation of the (f) criterion, the General Court’s analysis is confirmed by the Court of Justice, after interpreting the term ‘support’ from a literal perspective, as not depending on the actual provision of goods or on the existence of a transfer of funds directly benefiting the Russian Government; from a contextual perspective, ruling out any parallel with the different concept of ‘financial assistance’ within the meaning of Regulation No 833/2014; (5) and from a teleological perspective, taking into consideration the objective of ensuring the effectiveness of the pressure exerted on the Russian Federation to put an end to its military aggression against Ukraine. That criterion therefore covers any support capable, by its quantitative or qualitative importance, of providing the Russian Government with material or financial resources or facilities allowing it to pursue its actions to destabilise Ukraine.
The Court of Justice also finds that the General Court did not err in law by holding that the Council discharges its burden of proof if it presents to the Courts of the European Union a body of sufficiently specific, precise and consistent evidence to establish that there is a sufficient link between the person subject to a fund-freezing measure and the regime being combated. It observes that there is no rule of EU law that requires the Council, in its decisions imposing restrictive measures, to specify the standard of proof applicable in that field. In addition, that standard of proof is in line with the fact that restrictive measures are precautionary, temporary and reversible, and that their validity is always subject to the continuing existence of the factual and legal circumstances that led to their adoption. Since the effectiveness of the judicial review requires verification of the factual allegations in the statement of reasons underpinning the decision imposing restrictive measures, so that those reasons, or, at the very least, one of those reasons, can be deemed to be sufficient in themselves to support that decision, the aforementioned standard of proof enables the Courts of the European Union to carry out a full review of the factual basis for those measures, although without imposing on the Council a burden of proof that would be incompatible with the constraints due to urgency that surround the introduction of such measures and with the fact that they are precautionary.
As regards, in the third and last place, whether the restrictive measures at issue are proportionate, the Court of Justice notes, first, that the General Court took account of the economic consequences caused by those restrictive measures, including on the appellant’s customers, the latter being able to avail themselves of legal remedies before the national courts, in particular to make a request for the release of frozen funds in accordance with the derogations laid down by Decision 2014/145 and Regulation No 269/2014. In order to ensure the functioning of the system of derogations provided for in Article 2(5) of that decision and in Article 6(1) of that regulation, those provisions must be interpreted in such a way that they authorise the national authorities to release the appellant’s funds or economic resources in order to enable the appellant to make a payment taking the form of the return of its customers’ securities which the appellant held in its frozen accounts with securities depositories established in the European Union. In addition, where a national authority decides on a request to release frozen funds pursuant to the derogations laid down by that decision and that regulation, it is required to ensure that the interference with the right to property of the appellant’s customers is in compliance with the conditions laid down in Article 52 of the Charter of Fundamental Rights of the European Union. Second, after emphasising that the restrictive measures at issue are temporary and reversible, the Court notes that the approach of targeting economic operators which, like the appellant, support the Russian Government materially or financially cannot be regarded as being manifestly inappropriate with regard to the objective pursued by the Council, namely to reduce the revenue of the Russian State and to put pressure on that government in order to diminish its ability to finance its military aggression against Ukraine.