Monday 16 December 2013

Al-Dulimi UN Sanctions Judgment

It is my pleasure to introduce a guest post by my colleague here at SIM, dr Stephan Hollenberg, on the recent case of Al-Dulimi and Montana Management Inc v Switzerland, which focuses on UN sanctions. Stephan defended his PhD last year on judicial protection of human rights against decisions of the United Nations Security Council (UNSC). Here are his comments on the case:

Al-Dulimi and Montana Management Inc v Switzerland
Stephan Hollenberg

Mr Al-Dulimi allegedly was the finance manager for the Iraqi secret services under Saddam Hussein. His assets and of a company of which he was managing director have been frozen following a Security Council resolution imposing sanction measures against the ancient regime of Iraq, as implemented against him by Switzerland. Under this sanctions regime his assets not only had to be frozen but also confiscated and transferred to the Development Fund for Iraq.

In response, Mr Al-Dulimi complained before the Swiss Federal Court that he was not informed of the reasons underlying the decision to impose the sanction measures against him and he was not afforded any due process guarantees under article 6 ECHR. In 2008 the Swiss Court decided that it was not competent to engage in a judicial review of the implementation of the UNSC decision. Any decision on de-listing could according to the Swiss Court only be made by the relevant UNSC Sanctions Committee. Hereupon Mr Al-Dulimi filed a compaint with the ECtHR, among others, claiming a violation of his right to access to court.

The case raises the issue of precedence of obligations created by the UNSC over those under the ECHR, which the Court was confronted with earlier in the cases of Al-Jedda and Nada. Especially, the Nada case, concerning an individual directly targeted by UNSC sanctions against alleged financers of international terrorism, bears essential similarities to the present case. In the Nada case the Grand Chamber considered Switzerland to have violated Mr Nada’s rights to private and family life and his right to an effective remedy, by implementing too strictly the travel ban imposed by the UNSC, and by not affording him any possibility for review.

Presumption of Compliance
In the cases of Al-Jedda and Nada the Court developed and employed the interpretative technique of presumption of compliance. In those cases the Court established that in addition to maintaining international peace and security, the purposes of the UN include encouraging respect for human rights and fundamental freedoms as well. From this it derived that there must be a presumption that the UNSC does not intend states to take measures that would result in a breach of their obligations under international human rights law. Hence the Court determined that when the meaning of a particular provision of a UNSC resolution is unclear, the interpretation that harmonizes the obligation created by the UNSC most with the states’ obligations under international human rights law must be followed. It added that the presumption could be rebutted when the UNSC uses clear and explicit language to that effect. It did however not indicate explicitly what the consequences of such rebuttal would be. Even in the Nada case, in which it found a rebuttal of the presumption, it did not consider what the consequences thereof would be.

It was to be expected that the Court would employ this same interpretative technique in regard to the interferences with Mr Al-Dulimi’s human rights following from Switzerland’s implementation of the impugned UNSC resolution. However, the Court (Second Section) distinguished the Al-Dulimi from the Nada case, on the basis of a perceived difference in scope of discretion left by the UNSC for the implementation of the measures imposed by the relevant UNSC resolution. Subsequently, it employed the familiar concept of equivalent protection, which it developed in the context of obligations created by the EU (see Bosphorus). 
There are two problems with this approach. First, the scope of discretion left by the UNSC resolutions concerned in Al-Dulimi and Nada appears to be the same. Second, in regard to instances in which no scope of discretion is left by the UNSC the presumption of compliance would appear a more appropriate approach to follow than that of equivalent protection.

Scope of Discretion
For UNSC resolutions to become effective they need to be implemented by UN member states in their respective domestic legal orders. The UNSC usually formulates a certain aim or result that needs to be achieved, it is then for states themselves to determine how best to do that. Therefrom emanates a scope of discretion. However, in regard to the targeted sanctions regimes it can hardly be maintained that there is any scope of discretion for states. The obligation to freeze assets is phrased by the UNSC as an obligation of conduct, leaving hardly any scope of discretion for states to implement these measures as they deem fit. They have no other possibility but to freeze the assets of the individuals designated by the relevant UNSC sanctions committee. Moreover, this conduct (and result) may be interfered with if states would provide an opportunity for fair trial or an effective remedy to the individuals concerned. Therefore, despite the fact that the relevant resolutions remain silent on possibilities to afford due process guarantees while implementing these sanction measures, it must be assessed as falling outside the states’ scope of discretion. Thus providing such guarantees would go against the obligation created by these resolutions.

However, the Grand Chamber accepted in Nada that the UNSC had left states a certain scope of discretion. Similarly, the Court of Justice of the EU had held earlier in the Kadi case that such discretion existed in relation to the implementation of the targeted sanctions. These courts arrived at this conclusion by arguing that the UN Charter does not prescribe how states should implement UNSC resolutions, rather than looking at the text of the relevant resolution. These courts’ approach is not very compelling because if the UNSC would impose a clearly circumscribed obligation of conduct, then any scope of discretion that might emanate from the fact that the UN Charter does not prescribe how to implement that obligation is illusory. States can then do no other but to engage in the conduct prescribed. Moreover, following these courts’ reasoning every UNSC resolution would leave states a scope of discretion. However, in the present instance of the Al-Dulimi case, the Court accepted that the UNSC left no such scope. On the basis of this finding it distinguished it from the Nada case (see paragraph 117). It did not further clarify how it arrived at that determination. It only considered that such a difference exists. 

As was mentioned, this difference cannot be arrived at by relying on the argument of the UN Charter not prescribing how to implement, because that is exactly the same in both situations. However, also when comparing the two provisions concerned in the relevant UNSC resolutions a distinction is not immediately obvious. Especially when the limitation of the right to a fair trial in the present instance is compared to the limitation of Mr Nada’s enjoyment of his right to an effective remedy, it becomes clear that the relevant provisions are significantly similar. Both resolutions decide merely that states should take the measures prescribed against the individuals designated by the relevant UNSC Sanctions Committee. They do not explicitly address the issue of a fair trial or an effective remedy, but it is implied in the system of the centralized sanctions regime that such due process guarantees were not foreseen by the UNSC. Providing such guarantees at a domestic level would automatically impair the effectiveness of the centralized sanctions regime. It might result in a fragmented application of the sanction measures. Accordingly, there appears to be no difference in the scope of discretion left by the UNSC in regard to the two different sanction regimes. 
The UNSC resolution relevant to Mr Al-Dulimi does mention that ‘claims made by private individuals or non-government entities on [funds transferred to the Development Fund for Iraq] may be presented to the internationally recognized, representative government of Iraq.’ This might suggest that Mr Al-Dulimi’s only remedy foreseen by the UNSC is via the Iraqi government, and therewith a contrario excluding other possibilities. But the context of this provision indicates that it must be concerned with the claims of others than the targeted individual. Moreover, the Court does not consider this aspect of the provision at all. 

Equivalent Protection
After having distinguished Al-Dulimi from Nada, the Court engaged in an equivalent protection test. This test entails that if the Court is asked to review a state’s conduct that was strictly required by that state’s membership of an international organization, it presumes that the state did not act in contravention of the ECHR if the international organization in question protects human rights in a manner that is at least equivalent to the protection offered by the Convention. If a presumption of equivalent protection is then established this can only be rebutted when in a particular instance the protection was manifestly deficient. The Court employed and developed this test primarily in the context of the relationship between the ECHR and the EU.
Applying this test similarly in regard to the UNSC is highly remarkable. Especially, since the Court appears to have gone through a lot of effort in earlier cases in order to avoid applying it in that context, due to the special task and position of the UNSC (see the cases of Behrami; Beric; Kanlinic and Bilbija; Galic; and Blagojevic). In addition, it is hardly conceivable that an organization such as the UN would ever be able to provide a measure of equivalent protection to individuals directly affected by a UNSC resolution.  

Also, logically speaking it does not make sense to assess a situation concerning a UNSC decision that does not leave a scope of discretion within the context of the equivalent protection rather than consider it to be a rebuttal of the presumption of compliance. In this regard, the Court appears to make a distinction between latitude for interpretation following from ambiguous language and the scope of discretion. Such distinction is however difficult to maintain. Scope of discretion and room for interpretation are closely intertwined. Scope of discretion often emanates from what a resolution is silent about.

Moreover, if the presumption of compliance would only be employed in cases where there is a scope of discretion then the Court would assess a respondent state’s conduct that is not necessarily required by the UNSC. That state had an opportunity to implement the UNSC decision differently within the latitude left by the scope of discretion. Hence there is no conflict of norms. Therefore it cannot be maintained that the respondent state was under an obligation to give precedence to an obligation created by the UNSC over obligations under other international agreements, pursuant to article 103 of the UN Charter. Consequently, a rebuttal of a presumption by employing clear and explicit language would not be relevant, because the respondent state could have acted otherwise within the scope of discretion. 

Actually, this appears to be the result in the Nada case in which the presumption of compliance was rebutted but in which the Court also found a certain latitude for Switzerland to implement the sanctions in accordance with the ECHR. But this would mean that the whole doctrine of presumption of compliance (or at least the option for its rebuttal) loses its meaning. The UNSC will then never be able to override states’ obligations under the ECHR. That is a position one could defend, but perhaps it would be better if that would be phrased in clear and explicit language. 

Violation of Article 6
Whatever could be said of that, the Court concluded that no presumption of equivalent protection could be established and that therefore it had to fully scrutinize the lawfulness of the interference with the applicant’s right to a fair trial - just like the Grand Chamber did in regard to article 13 in the Nada case. In that sense, the present decision could also be seen as making explicit what remained unmentioned in the Nada case. There the Court did not explicitly apply the equivalent protection doctrine but did establish that the protection afforded at the UN level was not considered to be sufficient. That is to say, the Grand Chamber followed the Swiss Federal Court’s evaluation of such protection it made five years earlier. That was before all the recent amendments were made to the de-listing procedure, such as the institution of the Ombudsperson in 2009. In that sense, the Court’s Chamber in the Al-Dulimi case went a bit further and relied on a recent rapport by UN’s Special Rapporteur on the promotion and protection of human rights while countering terrorism (Ben Emmerson) in holding that the present Ombudsperson procedure does not afford sufficient guarantees. Therefrom it deduced that the mere Focal Point presently available to Mr Al-Dulimi, which obviously affords a lower level of protection than the Ombudsperson, can a fortfiori never provide sufficient guarantees. 

It has to be noted, however, that with regard to the possibility to ensure the individuals’ right to a fair trial there is an important difference between the targeted sanctions against people such as Mr Kadi and Mr Nada and those against Mr Al-Dulimi. The first two are anonymous individuals allegedly involved in financially supporting international terrorism. Such allegations can often only be substantiated by relying on confidential material, gathered by national intelligence agencies, which is not likely to be shared with the targeted individual or with foreign courts. In contrast, the question whether Mr Al-Dulimi was indeed the finance manager for the Iraqi secret services under Sadam Hussein is in principle publicly available information. In a cable, made public by Wikileaks, the US State Department, which already in 2008 foresaw this decision by the ECtHR, asked for additional information on the allegations against Mr Al-Dulimi. The cable notes that ‘Al-Dulimi denies he was ever a member of the Baath Party, and further denies he was "a director of investments for the Iraqi Intelligence Service" under Saddam Hussein.’ Therefore the US Embassy in Baghdad was instructed to ask the Iraqis whether they could provide further information about what Al-Dulimi did for the Saddam Hussein regime. According to the Iraqis it was public information that Mr Al-Dulimi held that position and that he was one of the senior officials of the former Iraqi regime. This statement might not be sufficient, but perhaps some official documents might do. At least this makes it easier to organize a fair trial for people such as Mr Al-Dulimi than for those such as Mr Kadi and Mr Nada. An example thereof can be found in the recent decision of EU’s General Court in the case of Makhlouf, concerning sanction measures against members of the Syrian regime.

The decision by the Second Section of the ECtHR is another example after decisions by the Grand Chamber (Nada) and the Court of Justice of the EU (Kadi) that the European judiciary is not going to back down and is seeking full confrontation with the Security Council. This obviously is putting member states in a very difficult situation. They are under two conflicting international obligations, which are very difficult to harmonize. This confrontational approach might eventually result in better protection at the UN level. The UNSC, seeing its efficacy and efficiency of action undermined by substantial annulments of domestic implementations, might be willing to adjust its measures to the requirements upheld by these courts. However, for such approach to be effective these courts need to maintain a dialogue with the Security Council. In that regard, the Second Section’s use of the equivalent protection doctrine in the Al-Dulimi case, which might indicate that it is willing to engage in such dialogue, is to be preferred over the Court of Justice’s decision in its latest Kadi case, in which it largely ignored the progress being made at the UN level. The difficulty, however, remains that equivalent protection at UN level is very unlikely ever to be achieved in regard to individuals directly affected by a Security Council decision. A mere possibility for review would probably not be sufficient, also substantive human rights guarantees would have to be in place. This will be very difficult to realize in the primarily inter-governmental setting of the UN.