Article 17 - Right to property
Article 52 - Scope and interpretation
Article 49 - Principles of legality and proportionality of criminal offences and penalties
Key facts of the case:
Reference for a preliminary ruling – Common Foreign and Security Policy (CFSP) – Restrictive measures adopted in view of the actions of the Russian Federation destabilising the situation in Ukraine – Decision 2014/512/CFSP – Article 2(2)(a) – Jurisdiction of the Court – Final sentence of the second subparagraph of Article 24(1) TEU – Article 275 TFEU – Article 215 TFEU – Article 17 of the Charter of Fundamental Rights of the European Union – Right to property – Principle of legal certainty and principle that penalties must be defined by law – Brokering services in relation to military equipment – Prohibition on providing such services – Failure to notify the competent national authorities – Administrative offence – Fine – Automatic confiscation of the amounts received in consideration for the prohibited transaction
Outcome of the case:
On those grounds, the Court (Grand Chamber) hereby rules:
Article 2(2)(a) of Council Decision 2014/512/CFSP of 31 July 2014 concerning restrictive measures in view of Russia’s actions destabilising the situation in Ukraine, as amended by Council Decision 2014/659/CFSP of 8 September 2014, must be interpreted as meaning that the prohibition on providing brokering services laid down in that provision is applicable even where the military equipment that was the subject of the brokering transaction concerned was never imported into the territory of a Member State.
75) Consequently, the Court finds that, by its first and second questions, the referring court asks, in essence, whether Article 2(2)(a) of Decision 2014/512, read in the light of the right to property enshrined in Article 17 of the Charter and of the principle of legal certainty and the principle that penalties must be defined by law, must be interpreted as precluding a national measure confiscating the entire proceeds of a brokering transaction referred to in Article 2(2)(a), which is implemented automatically following a finding by the competent national authorities of an infringement of the prohibition on carrying out that transaction and of the obligation to notify that transaction.
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78) In the second place, regarding the right to property enshrined in Article 17 of the Charter, paragraph 1 thereof provides that ‘everyone has the right to own, use, dispose of and bequeath his or her lawfully acquired possessions. No one may be deprived of his or her possessions, except in the public interest and in the cases and under the conditions provided for by law, subject to fair compensation being paid in good time for their loss. The use of property may be regulated by law in so far as is necessary for the general interest.
79) As the Court has previously held, Article 17 of the Charter is a rule of law intended to confer rights on individuals (judgment of 21 May 2019, Commission v Hungary (Usufruct over agricultural land), C‑235/17, EU:C:2019:432, paragraph 68 and the case-law cited).
80) In accordance with Article 52(3) of the Charter, in so far as the Charter contains rights which correspond to rights guaranteed by the European Convention for the Protection of Human Rights and Fundamental Freedoms, signed in Rome on 4 November 1950, the meaning and scope of those rights are to be the same as those laid down by that convention. This provision does not, however, prevent EU law from providing more extensive protection. It follows that, for the purposes of interpreting Article 17 of the Charter, it is necessary to take into account the case-law of the European Court of Human Rights relating to Article 1 of Protocol No 1, which establishes the protection of the right to property, as the minimum threshold of protection (see, to that effect, judgment of 21 May 2019, Commission v Hungary (Usufruct over agricultural land), C‑235/17, EU:C:2019:432, paragraph 72 and the case-law cited).
81) As consistently held by the European Court of Human Rights as regards Article 1 of Protocol No 1, Article 17(1) of the Charter contains three distinct rules. The first rule, set out in the first sentence of that provision, is of a general nature and gives concrete expression to the principle of respect for property. The second, set out in the second sentence of that provision, refers to a person being deprived of property and subjects that deprivation to certain conditions. The third, which is contained in the third sentence of that provision, recognises States’ power, inter alia, to regulate the use of property in so far as is necessary for the general interest. These rules are not, however, unrelated. The second and third rules relate to specific examples of infringements of the right to property and are to be interpreted in the light of the principle enshrined in the first rule (judgment of 5 May 2022, BPC Lux 2 and Others, C‑83/20, EU:C:2022:346, paragraph 38).
82) In that connection, it is apparent from the case-law of the European Court of Human Rights that confiscation measures relating to the proceeds of an infringement or unlawful activity or an instrument having been used to commit an infringement which does not belong to a third party in good faith constitute, as a general rule, regulation of the use of property, even if they deprive, by their very nature, a person of his or her property (see, inter alia, ECtHR, 24 October 1986, Agosi v. the United Kingdom, CE:ECHR:1986:1024JUD000911880, § 51; ECtHR, 12 May 2015, Gogitidze and Others v. Georgia, CE:ECHR:2015:0512JUD003686205, § 94; and ECtHR, 15 October 2020, Karapetyan v. Georgia, CE:ECHR:2020:1015JUD006123312, § 32).
84) In those circumstances, such a confiscation measure is a limitation on the exercise of the right to property, relating to how the use of property is governed for the purposes of the third sentence of Article 17(1) of the Charter.
85) It must be borne in mind that the right to property guaranteed by Article 17 of the Charter is not absolute and that its exercise may be subject to restrictions justified by objectives of general interest pursued by the European Union (judgment of 20 September 2016, Ledra Advertising and Others v Commission and ECB, C‑8/15 P to C‑10/15 P, EU:C:2016:701, paragraph 69).
86) However, in accordance with Article 52(1) of the Charter, any limitation on the exercise of the rights and freedoms recognised by the Charter must be provided for by law and respect the essence of those rights and freedoms and, subject to the principle of proportionality, be necessary and actually correspond to an objective of general interest recognised by the European Union or the need to protect the rights and freedoms of others.
101) Consequently, the limitation on the exercise of the right to property contained in such a confiscation measure appears to comply with the principle of proportionality and, as a result, to be justified in the light of the conditions laid down in Article 52(1) of the Charter, which it is for the referring court to verify.
103) The principle that offences and penalties must be defined by law, which constitutes specific expression of the general principle of legal certainty and is enshrined in Article 49 of the Charter, means, inter alia, that legislation must clearly define offences and the penalties which they attract in order to ensure foreseeability as regards both the definition of the offence and the determination of the penalty (see, to that effect, judgments of 8 March 2022,Bezirkshauptmannschaft Hartberg-Fürstenfeld (Direct effect), C‑205/20, EU:C:2022:168, paragraph 47 and of 24 July 2023, Lin, C‑107/23 PPU, EU:C:2023:606, paragraph 104 and the case-law cited).
107) Having regard to the foregoing, the answer to the first and second questions is that Article 2(2)(a) of Decision 2014/512, read in the light of the right to property enshrined in Article 17 of the Charter and of the principle of legal certainty and the principle that penalties must be defined by law, must be interpreted as not precluding a national measure confiscating the entire proceeds of a brokering transaction referred to in Article 2(2)(a), which is implemented automatically following a finding by the competent national authorities of an infringement of the prohibition on carrying out that transaction and of the obligation to notify that transaction.
