Varabei v Council (Common foreign and security policy - Restrictive measures taken in view of the situation in Belarus - Freezing of funds - Judgment) [2023] EUECJ T-245/21 (08 November 2023)

BAILII is celebrating 24 years of free online access to the law! Would you consider making a contribution?
No donation is too small. If every visitor before 31 December gives just £1, it will have a significant impact on BAILII's ability to continue providing free access to the law.
Thank you very much for your support!

(Common foreign and security policy – Restrictive measures taken in view of the situation in Belarus – Freezing of funds – Restrictions on entry into the territory of the Member States – Maintenance of the applicant’s name on the lists of persons, entities and bodies concerned – Error of assessment)

Mikalai Mikalevich Varabei, residing in Novopolotsk (Belarus), represented by G. Kremslehner, H. Kühnert and P. Doralt, lawyers,

Council of the European Union, represented by T. Haas and S. Van Overmeire, acting as Agents,

composed of J. Svenningsen, President, J. Laitenberger and M. Stancu (Rapporteur), Judges,

having regard to the measure of organisation of procedure of 13 October 2022 and the response of the applicant lodged at the Court Registry on 15 November 2022 and 7 March 2023,

1 By its action under Article 263 TFEU, the applicant, Mr Mikalai Mikalevich Varabei, seeks the annulment of Council Decision (CFSP) 2021/353 of 25 February 2021 amending Decision 2012/642/CFSP concerning restrictive measures against Belarus (OJ 2021 L 68, p. 189), and Council Implementing Regulation (EU) 2021/339 of 25 February 2021 implementing Article 8a of Regulation (EC) No 765/2006 concerning restrictive measures in respect of Belarus (OJ 2021 L 68, p. 29), in so far as those acts (together, ‘the contested acts’) concern the applicant.

3 The present case has been brought in the context of restrictive measures adopted since 2004 in view of the situation in Belarus concerning democracy, the rule of law and human rights. As is apparent from the recitals of Council Implementing Decision (CFSP) 2020/2130 of 17 December 2020 implementing Decision 2012/642/CFSP concerning restrictive measures against Belarus (OJ 2020 L 426 I, p. 14), and Council Implementing Regulation (EU) 2020/2129 of 17 December 2020 implementing Article 8a(1) of Regulation (EC) No 765/2006 concerning restrictive measures in respect of Belarus (OJ 2020 L 426 I, p. 1), the case is more specifically linked to the intensification of the persistent violation of human rights and the brutal crackdown on opponents of the regime of President Lukashenko following the presidential elections of 9 August 2020, which the European Union found to be inconsistent with international standards.

4 On 18 May 2006, the Council of the European Union adopted, on the basis of Articles [75 and 215 TFEU], Regulation (EC) No 765/2006 concerning restrictive measures against President Lukashenko and certain officials of Belarus (OJ 2006 L 134, p. 1) and, on 15 October 2012, on the basis of Article 29 TEU, Decision 2012/642/CFSP concerning restrictive measures against Belarus (OJ 2012 L 285, p. 1).

5 The criterion on the basis of which the individual restrictive measures against the applicant were adopted is laid down, first, in Article 3(1)(b) of Decision 2012/642 and, second, in Article 4(1)(b) of that decision, as well as in Article 2(5) of Regulation No 765/2006, in the versions in force at the time when the contested acts were adopted.

6 Article 3(1)(b) of Decision 2012/642 provides for the prohibition on entry into, and transit through, the territory of the European Union of persons who benefit from or support the regime of President Lukashenko.

7 Article 4(1)(b) of Decision 2012/642 and Article 2(5) of Regulation No 765/2006, which refers to the former provision, provide for the freezing of all funds and economic resources belonging to natural or legal persons, entities and bodies who benefit from or support the regime of President Lukashenko, as well as legal persons, entities and bodies owned or controlled by them.

8 By way of Implementing Decision 2020/2130 and Implementing Regulation 2020/2129, the applicant’s name was included on the lists of persons, entities and bodies subject to the restrictive measures set out in the annex to Decision 2012/642 and in Annex I to Regulation No 765/2006 (together, ‘the lists at issue’).

9 In those acts, the Council justified the adoption of the restrictive measures against the applicant, referring to him as a ‘businessman, co-owner of [Bremino-Grupp]’ and providing the following reasons:

‘He is one of the leading businessmen operating in Belarus, with business interests in petroleum, coal transit, banking and other sectors.

He is the co-owner of [Bremino-Grupp] – a company that has enjoyed tax breaks and other forms of support from the Belarusian administration.

As such he is benefitting from and supporting the [regime of President Lukashenko]’.

10 By letter of 8 February 2021, the applicant requested that the Council provide him with all the documents and evidence supporting the reasons for the listing.

11 On 18 February 2021, the Council sent the applicant the documents bearing references WK 13842/2020 INIT, WK 14796/2020 EXT 4 and WK 2134/2021 INIT, respectively.

12 By the contested acts, the restrictive measures applied to the applicant were maintained until 28 February 2022, the reasons justifying that continued listing being the following:

‘He is one of the leading businessmen operating in Belarus, with business interests in petroleum, coal transit, banking and other sectors.

He is the co-owner of [Bremino-Grupp] – a company that has enjoyed tax breaks and other forms of support from the Belarusian administration.

He is therefore benefitting from and supporting the [regime of President Lukashenko]’.

13 By letter of 26 February 2021, the Council informed the applicant of the adoption of the contested acts.

– in the alternative, in the event that the Court annuls the contested acts in so far as they concern the applicant, order that the effects of Decision 2021/353 be maintained until the partial annulment of Implementing Regulation 2021/339 takes effect.

16 In his single plea in law, the applicant claims, in essence, that neither the Council’s contentions relating to his activities in various economic sectors in Belarus, nor those relating to Bremino-Grupp – a limited liability company under Belarusian law – show that he benefits from and supports the regime of President Lukashenko. When questioned in that regard at the hearing, the applicant stated that he did not intend to put forward a plea alleging an inadequate statement of reasons for the contested acts in so far as they concern him, and that his arguments relate rather to insufficient evidence.

18 As a preliminary point, it should be borne in mind that the effectiveness of the judicial review guaranteed by Article 47 of the Charter of Fundamental Rights of the European Union requires, in particular, that, as part of the review of the lawfulness of the grounds which are the basis of the decision to include or to maintain the name of a person or entity on the lists of persons subject to restrictive measures, the Courts of the European Union are to ensure that that decision, which affects that person or entity individually, is taken on a sufficiently solid factual basis. That entails a verification of the factual allegations in the summary of reasons underpinning that decision, with the consequence that judicial review cannot be restricted to an assessment of the cogency in the abstract of the reasons relied on, but must concern whether those reasons, or, at the very least, one of those reasons, deemed sufficient in itself to support that decision, is substantiated (see, to that effect, judgment of 18 July 2013, Commission and Others v Kadi, C‑584/10 P, C‑593/10 P and C‑595/10 P, EU:C:2013:518, paragraph 119).

19 It is for the Courts of the European Union, in order to carry out that examination, to request the competent European Union authority, when necessary, to produce information or evidence, confidential or not, relevant to such an examination (see, to that effect, judgment of 18 July 2013, Commission and Others v Kadi, C‑584/10 P, C‑593/10 P and C‑595/10 P, EU:C:2013:518, paragraph 120 and the case-law cited).

20 That is because it is the task of the competent European Union authority to establish, in the event of challenge, that the reasons relied on against the person or entity concerned are well founded, and not the task of that person or entity to adduce evidence of the negative, that those reasons are not well founded (see, to that effect, judgment of 18 July 2013, Commission and Others v Kadi, C‑584/10 P, C‑593/10 P and C‑595/10 P, EU:C:2013:518, paragraph 121).

21 If the competent European Union authority provides relevant information or evidence, the Courts of the European Union must then determine whether the facts alleged are made out in the light of that information or evidence and assess the probative value of that information or evidence in the circumstances of the particular case and in the light of any observations submitted in relation to them by, among others, the person or entity concerned (see, to that effect, judgment of 18 July 2013, Commission and Others v Kadi, C‑584/10 P, C‑593/10 P and C‑595/10 P, EU:C:2013:518, paragraph 124).

22 Such an assessment must be carried out by examining the evidence and information not in isolation but in its context. The Council discharges the burden of proof borne by it if it presents to the Courts of the European Union a sufficiently concrete, precise and consistent body of evidence to establish that there is a sufficient link between the entity subject to a measure freezing its funds and the regime or, in general, the situations, being combated (see judgment of 12 February 2020, Kanyama v Council, T‑167/18, not published, EU:T:2020:49, paragraph 93 and the case-law cited).

23 Furthermore, the Courts of the European Union may also rely on evidence, both inculpatory or exculpatory, adduced by the applicant during the judicial proceedings. The fact that an item of evidence has been submitted as exculpatory evidence by the person subject to the restrictive measures does not prevent that evidence from possibly being used against that person to support the merits of the reasons underpinning the restrictive measures taken against him or her (see, to that effect, judgment of 12 February 2020, Ilunga Luyoyo v Council, T‑166/18, not published, EU:T:2020:50, paragraph 124 and the case-law cited).

24 Lastly, as regards the reliability and probative force of evidence, including that stemming from digital sources, it should be borne in mind that the activity of the Court of Justice and of the General Court is governed by the principle of the unfettered evaluation of evidence, and that it is only the reliability of the evidence before the Court which is decisive when it comes to the assessment of its value. In addition, in order to assess the probative value of a document, regard should be had to the credibility of the account it contains, and in particular to the person from whom the document originates, the circumstances in which it came into being, and the person to whom it was addressed and whether, on its face, the document appears to be sound and reliable (see, to that effect, judgments of 14 March 2018, Kim and Others v Council and Commission, T‑533/15 and T‑264/16, EU:T:2018:138, paragraph 224, and of 12 February 2020, Kande Mupompa v Council, T‑170/18, EU:T:2020:60, paragraph 107 (not published)).

25 It is in the light of those considerations that it must be ascertained whether, in the present case, the reasons for maintaining the applicant’s name on the lists at issue are based on a sufficiently specific, precise and consistent body of evidence to establish that he benefits from and supports the regime of President Lukashenko.

26 As is apparent from paragraphs 8 to 12 above, the applicant’s name was included and, later, maintained on the lists at issue on the ground that he is one of the leading businesspersons operating in Belarus who, first, has, inter alia, financial interests in the petroleum, coal transit and banking sectors and, second, is a co-owner of Bremino-Grupp, a company which benefited from tax reductions and other forms of support from the Belarusian administration, and that, on that basis, he benefits from and supports the regime of President Lukashenko.

27 It is therefore necessary to examine whether the factual evidence on which the ground at issue is based has been established, and whether the Council made an error of assessment in finding, on the basis of that evidence, that, at the time when the contested acts were adopted, the applicant benefited from and supported the regime of President Lukashenko as provided for in Articles 3(1)(b) and 4(1)(b) of Decision 2012/642 and Article 2(5) of Regulation No 765/2006.

The assessment that the applicant is one of the leading businesspersons operating in Belarus, with financial interests, inter alia, in the petroleum, coal transit and banking sectors

28 First of all, it should be noted that the applicant does not dispute that he is a leading businessman in Belarus with financial interests, inter alia, in the petroleum, coal transit and banking sectors. However, he submits, in essence, that his financial interests in the petroleum, coal transit and banking sectors in Belarus do not justify the conclusion that he benefits from and supports the regime of President Lukashenko. His economic activities in those areas have either reduced significantly over time, or have always been limited.

29 As regards the extent of the applicant’s financial interests in those sectors, in the first place, it should be noted that, in the petroleum sector, he carries on his activities mainly through his undertaking Interservice, of which he does not dispute being the owner.

30 As is apparent from the interview given by the applicant to the media outlet ‘TUT.by’ in April 2019, which gave rise to the article submitted as item of evidence No 4 of document WK 2134/2021 INIT, Interservice has been active in the sector of oil import and export in Belarus for over 20 years and was, as the applicant stated in that interview, ‘more active in its activities’ at the time of that interview. In addition, items of evidence Nos 5 and 8 of that document show that, since 2012, Interservice also owns an oil refinery in Belarus. Lastly, as is apparent from items of evidence Nos 4 and 7 of document WK 2134/2021 INIT, Interservice owns the undertaking Oil Bitumen Plant and holds 75% of the shares in the undertaking New Oil Company.

31 The undertaking New Oil Company, 75% of the shares of which are held by Interservice and 25% by the Belarusian railways and the Development Bank of Belarus, entered into a public-private partnership with the State-owned undertaking Belarusian Oil Company, which until then had a monopoly over exports of petroleum products from the Belarusian national refineries Naftan and Mozyr. It is apparent from the evidence submitted by the Council, in particular from a press article of 16 October 2020 submitted as item of evidence No 7 in document WK 2134/2021 INIT, that New Oil Company was authorised to export such products in partnership with Belarusian Oil Company. It follows that, contrary to what the applicant claims, New Oil Company’s business in the export of petroleum products cannot be considered to be ‘very limited’ in Belarus.

32 The undertaking Oil Bitumen Plant acquired a majority stake of 51% in the capital of the ‘Samara – Western direction’ pipeline linking Russia to Ukraine via Belarus, in part owned by the Ukrainian company PrykarpatZakhidTrans. That acquisition was authorised in March 2019 and was intended to further facilitate the transport of oil from the Belarusian national refineries Mozyr and Naftan to Ukraine and to other European countries in future, as is apparent from the applicant’s assertions in the interview referred to in paragraph 30 above.

33 In that regard, the applicant submits that he was no longer involved, at the date of the contested acts, in the ‘Samara – Western direction’ pipeline, because the latter had been requisitioned by the Ukrainian State. However, it should be noted that the press article which he produced as Annex C.6 to the reply does not substantiate that claim. That article, dated 24 February 2021, refers to the decision to requisition ‘part’ of the pipeline and mentions only the Ukrainian company PrykarpatZakhidTrans, without any reference to the part of the capital belonging to Oil Bitumen Plant. In addition, it should be noted that the article refers to measures taken by the Ukrainian authorities with a view to transferring the control of the entire pipeline facility to a Ukrainian public undertaking, without, however, specifying the date on which such a transfer will take place. Lastly, and in any event, it must be stated that, even if the applicant’s claim that he was no longer involved, on the date of the contested acts, in the ‘Samara – Western direction’ pipeline was supported by the evidence which he submitted, it cannot be concluded therefrom that the Council made an error of assessment in considering that the applicant had financial interests in the petroleum sector, since, as is apparent from paragraphs 30 and 31 above, his interests in that sector are not limited to Oil Bitumen Plant’s involvement in that pipeline.

34 Therefore, the Council’s evidence shows that the applicant’s activities in the petroleum sector in Belarus are not reduced. Contrary to what the applicant claims, not only did Interservice not withdraw from the oil import and export sector in Belarus, but, on the contrary, through its shareholding in other undertakings, Interservice, and therefore the applicant, further developed the already significant scale of its activities in the petroleum sector.

35 That conclusion is not called into question by the applicant’s claim relating to the losses allegedly incurred by Interservice between January 2020 and June 2021.

36 First, it must be stated that Interservice’s profit and loss accounts, produced by the applicant in Annexes C.1 and C.2 to the reply for the periods from January to December 2020 and from January to June 2021, respectively, are not relevant, since those accounts concern only that undertaking’s activities in the wholesale of coal and lignite. As is apparent from paragraphs 31 to 34 above, Interservice is also active in the oil sector through its shareholding in the undertakings Oil Bitumen Plant and New Oil Company.

37 Second, the reliability of the documents submitted by the applicant in support of his claims is also weakened in so far as the information contained in the various parts of those documents is not corroborated. Thus, the applicant claims that Interservice’s revenue in 2020 amounted to approximately 49.85 million Belarusian roubles (BYN) (namely, EUR 17.95 million), and it recorded operating losses of approximately BYN 27.37 million (namely, EUR 9.86 million). However, it should be noted that the first amount mentioned by the applicant corresponds, in Interservice’s profit and loss account for 2020, to the revenue derived exclusively from sales of products, goods, works and services, whereas the second amount appears under the heading ‘profit (loss) from continuous activities’. The same finding applies to Interservice’s profit and loss report for the period from January to June 2021.

38 In the second place, as regards the coal transit sector, the applicant states that his activities are limited to international trade in coal through Interservice, which shipped only 11.8% of the total volume of coal transit to Belarus or through Belarus.

39 However, the evidence submitted by the Council demonstrates that the applicant’s activities in the coal transit sector also include those of the company BelKazTrans, of which he is the sole owner, and that that company is the intermediary between the non-resident coal suppliers of Belarus and the Belarusian national railway company.

40 It is apparent from statements made directly by BelKazTrans, and cited in the press article published on 17 December 2019 on the website ‘naviny.by’, which constitutes item of evidence No 3 of document WK 13842/2020 INIT, that, since October 2019, all coal transit through the territory of Belarus, from or out of that country, is carried out through that undertaking, which has a direct contract with the Belarusian railways. On that basis, BelKazTrans is in a position to settle all issues for foreign companies, in particular Russian, Ukrainian or Polish companies. In that regard, as the director of BelKazTrans himself states, that company acts as a ‘regulator’ of that transit through the territory of Belarus.

41 It follows that the role of the applicant’s company BelKazTrans in coal transit through Belarus, as described by its own representative, entails, if not full control by means of a monopoly, at least a certain degree of control in order to regulate that sector. Such regulation would not be possible without a certain proximity to the Belarusian national railway company, which is also confirmed by the description of the contractual relationship with that latter company, made by BelKazTrans itself.

42 That conclusion cannot be called into question by the applicant’s assertion that BelKazTrans is only one of a number of transit companies in Belarus. The documents produced by the applicant as annexes to the application and the reply do not support that claim.

43 First, Annexes A.13 and A.14 to the application, namely, two different calculations of the cost of transport of a wagonload of coal from Kazakhstan to Ukraine, which indicate that the route for the transit of coal via Belarus is the cheapest, are not such as to demonstrate that BelKazTrans has no control over the transit of coal through the territory of Belarus. In addition, the reliability of that evidence is weakened in so far as, as the applicant states, those documents were generated by the applicant himself, using a Russian software application for the calculation of rail transport costs. As regards the general agreement applicable between the Belarusian railways and its contractual partners, produced in Annex A.15 to the application and publicly accessible on the internet, it must be held, contrary to what the applicant claims, that that document in the form of a standard contract, which does not mention BelKazTrans, cannot prove that BelKazTrans subscribed to standard transport tariffs with that public company.

44 Second, it is true that the information in the table on the delivery of coal produced in Annex C.9 to the reply in Ukraine indicates that, during eight months in the course of 2021, 18 885 coal wagons were dispatched from Belarus to Ukraine, and 526 of those wagons were dispatched by BelKazTrans as consignor and freight forwarding company. However, contrary to the applicant’s claims, those figures do not permit the inference that BelKazTrans was responsible, during that period, only for the shipment of 2.8% of all coal shipped to Ukraine, since, as the Council rightly states, the inclusion of the volumes of coal in respect of which BelKazTrans acted solely as a freight forwarding company significantly increases that percentage to 23% of shipments of coal from Belarus to that country. In so far as the items of evidence examined in paragraph 40 above do not specifically refer to BelKazTrans’s role in the transit of coal from Belarus to Ukraine over a given period in 2021, but in the transit of coal through Belarus in general, the relevance of that table produced in Annex C.9 to the reply is, moreover, limited.

45 In the third place, as regards the banking sector, it should be noted that the applicant does not dispute that he carries out activities in that sector through Absolutbank, a private bank in which he is the majority shareholder. As the applicant states without being contradicted by the evidence submitted by the Council, in terms of total assets value, Absolutbank is the 20th bank in Belarus.

46 In view of the foregoing, it must be concluded that the applicant’s activities in the petroleum, coal transit and banking sectors were not reduced on the date of adoption of the contested acts.

47 Accordingly, the Council did not make an error of assessment in considering that the applicant was one of the leading businesspersons operating in Belarus, with financial interests, inter alia, in the petroleum, coal transit and banking sectors.

The assessment that the applicant is a co-owner of the Bremino-Grupp, a company which allegedly benefited from tax reductions and other forms of support from the Belarusian authorities

48 At the outset, it should be noted that it is apparent from the Council’s written pleadings that the tax reductions and other forms of support from the Belarusian authorities referred to in the ground for including the applicant’s name on the lists at issue are those granted to Bremino-Grupp as managing company of the Bremino-Orsha Special Economic Zone (‘the Bremino-Orsha SEZ’), located in the Vitebsk region (Belarus). That zone which consists of a multimodal industrial and logistics complex is the second of the six special economic zones currently in existence in Belarus.

49 In that regard, first, it should be noted that the applicant acknowledges that he is the co-owner of Bremino-Grupp, in which he holds one third of shares. Second, he does not dispute that Bremino-Grupp manages the Bremino-Orsha SEZ and that the latter is subject to a special legal regime, in particular so far as concerns the tax regime in its territory. By contrast, the applicant considers, in essence, that that special regime does not justify the conclusion that Bremino-Grupp benefited from tax reductions and other forms of support from the Belarusian authorities. The special legal regime of the Bremino-Orsha SEZ was set up, as for any other SEZ, with the aim of attracting investments in the Vitebsk region where that zone is located. Thus, the tax advantages are available to all residents of the Bremino-Orsha SEZ and do not therefore reveal any selective advantage in favour of Bremino-Grupp; the slight differences in the advantages granted to that undertaking are explained by its role in that zone.

50 However, it must be pointed out that it is apparent from the evidence produced by the Council that Decree No 106 of 21 March 2019 of the President of Belarus ‘On the creation of the Bremino-Orsha [SEZ]’ (‘Decree No 106 of 2019’) establishes a special legal regime applicable to the Bremino-Orsha SEZ and provides for multiple tax derogations in the territory of that zone for a period of 50 years. Under that regime, in addition to the exemptions enjoyed by all the residents of that zone, Bremino-Grupp enjoys specific advantages as managing company of that zone, in particular an exemption from income tax and VAT until 2033 and an exemption from property tax for the duration of the existence of the Bremino-Orsha SEZ. It follows that, contrary to what the applicant claims, those tax advantages granted to Bremino-Grupp by Decree No 106 of 2019 in the territory of the Bremino-Orsha SEZ are selective in nature for Bremino-Grupp.

51 The applicant’s claim that Bremino-Grupp did not benefit from those advantages, given that it never made a profit as managing company of the Bremino-Orsha SEZ, is not such as to call that conclusion into question. First, that claim is not supported by any evidence and, second, it is of secondary importance to know whether and when those advantages were actually used. The mere fact that they were established by Decree No 106 of 2019 is sufficient to conclude that those advantages reveal that they were agreed by the regime of President Lukashenko.

52 As for the applicant’s argument that the tax advantages granted to the managing company of the Bremino-Orsha SEZ are less attractive than those granted to the managing company of the Industrial Park Great Stone SEZ, it must be held that that argument is irrelevant, since, in accordance with the case-law referred to in paragraph 22 above, the Council discharges its burden of proof if it presents to the Courts of the European Union a sufficiently specific, precise and consistent body of evidence to establish that there is a sufficient link between the entity subject to a measure freezing its funds and the regime or, in general, the situations being combated.

53 Furthermore, and in any event, the fact that the names of other companies managing other special economic zones in Belarus which received even greater tax advantages were not included on the lists at issue cannot cast doubt on the conclusion referred to in paragraph 50 above, since the principle of equal treatment must be reconciled with the principle of legality, according to which a person may not rely, to his or her own benefit, on an unlawful act committed in favour of another (see, to that effect, judgment of 27 September 2017, BelTechExport v Council, T‑765/15, not published, EU:T:2017:669, paragraph 96 and the case-law cited).

54 In addition, several items of evidence produced in the file show that the designation of Bremino-Grupp as managing company of the Bremino-Orsha SEZ was supported by the Belarusian administration. Thus, several items of evidence from different sources submitted by the Council show that the project for the creation of that zone was presented personally to President Lukashenko by the owners of Bremino-Grupp.

55 Moreover, the support of the Belarusian administration was confirmed by the evidence submitted by the applicant.

56 In that regard, it should be noted that the applicant acknowledges that the initiative for the creation of the Bremino-Orsha SEZ lied with Bremino-Grupp, which contacted the administration of the Vitebsk region for that purpose, and that administration took the necessary administrative steps in order for the zone to be created. What is more, it is apparent from the minutes of the meeting of 17 April 2014 between the representatives of Bremino-Grupp and those of the Vitebsk region, produced in Annex A.19 to the application and on which the Court may rely, in accordance with the case-law cited in paragraph 23 above, that the Bremino-Orsha SEZ was created and designed in such a way as to correspond to Bremino-Grupp’s proposals and was fully adapted to its project for investment in the construction of a multimodal logistics complex.

57 Accordingly, the applicant has not shown that the Council made an error of assessment in finding that Bremino-Grupp, of which he is one of the co-owners, benefited from tax reductions and other forms of support from the Belarusian authorities.

Whether the facts established by the Council demonstrate that the applicant benefits from or supports the regime of President Lukashenko

58 It is apparent from paragraphs 47 and 57 above that the Council did not make an error of assessment when it considered that the applicant is one of the leading businesspersons operating in Belarus with interests, inter alia, in the petroleum, coal transit and banking sectors, and that Bremino-Grupp, of which the applicant is one of the co-owners, benefited from tax relief and other forms of support from the Belarusian administration.

59 In order to establish that those elements justify the adoption of restrictive measures against the applicant in the contested acts, the Council refers to document WK 14796/2020 EXT 4 and contends that, in a country such as Belarus, activities of a magnitude such as those of the applicant, in multiple sectors and which are sustained over time, bearing in mind, further, the applicant’s contacts with the regime, are not possible without the endorsement of that regime.

60 In that connection, it should be observed that the fact of being one of the leading businesspersons in Belarus, taken in isolation, does not suffice to establish that the applicant maintains good relations with the public authorities or that his activities are indicative of proximity to the regime of President Lukashenko. At the date of adoption of the contested acts, neither Decision 2012/642 nor Regulation No 765/2006 had introduced a presumption of support for the regime of President Lukashenko against prominent businesspersons operating in Belarus.

61 However, that aspect cannot be disregarded in the overall assessment of the various relevant factors which would justify the applicant being considered as a person benefiting from or supporting the regime of President Lukashenko (see, to that effect, judgment of 12 May 2015, Ternavsky v Council, T‑163/12, not published, EU:T:2015:271, paragraph 121).

62 In that regard, first, it is necessary to note the scale of the applicant’s activities, which cover several important sectors of the Belarusian economy, namely, inter alia, the petroleum, coal transit, banking, transport and logistics sectors.

63 So far as concerns the petroleum sector in particular, apart from the fact that it is a highly regulated sector in Belarus, as the applicant himself accepts, it is apparent from the evidence submitted by the Council that relations with Russia in that area, including the purchase of Russian oil, are the basis of Belarusian economic prosperity. In addition, the re-export of Russian oil and petroleum products, in particular to Ukraine, accounts for 70% of Belarusian trade.

64 Second, it must be stated that the circumstances in which the applicant develops his activities, in particular in the petroleum and coal transit sectors and in the Bremino-Orsha SEZ, are indicative of his proximity to the regime of President Lukashenko and his good relations with public undertakings and public authorities.

65 As is apparent from paragraphs 31 and 41 above, in the petroleum and coal transit sectors, most of the activities of the applicant’s undertakings are carried out in the context of partnerships with State-owned undertakings such as Belarusian Oil Company, the Belarus Development Bank and the Belarusian railways; the latter two State-owned undertakings are also shareholders of New Oil Company together with Interservice. The same applies to the Bremino-Orsha SEZ, as is apparent from paragraph 54 above.

66 Those partnerships allowed the applicant’s undertakings not only to further develop the scale of their activities in the petroleum, coal transit, and transport and logistics sectors, but also to benefit from the right to exercise control over coal transit in Belarus, in the case of BelKazTrans, and the right to export – in particular to Ukraine – petroleum products from the national refineries Naftan and Mozyr in partnership with Belarusian Oil Company, in the case of New Oil Company. As for the Bremino-Orsha SEZ, in addition to the support granted by the Belarusian administration for the creation of that zone in accordance with the project proposed by Bremino-Grupp, the partnership with the public authorities enabled Bremino-Grupp to obtain specific tax advantages by means of Decree No 106 of 2019 which was, furthermore, approved by President Lukashenko himself.

67 Third, the information set out in paragraphs 62 to 66 above must also be taken into consideration in the light of the circumstances in which economic activities are carried out in Belarus.

68 The items produced by the Council regarding the circumstances in which economic activities are carried out in Belarus may be taken into account in the examination of the evidence, not in isolation but in its context, in accordance with the case-law cited in paragraph 22 above.

69 In the present case, the items of evidence submitted by the Council in relation to the economic situation in Belarus demonstrate that, under the regime of President Lukashenko, the Belarusian economy is characterised by the control exerted by the regime in both the public and private sectors, and by a system which rewards loyalty to the regime.

70 In that regard, the article published on 10 June 2020 on the website ‘currenttime.tv’ and produced as item of evidence No 2, the report of the Finnish Institute of International Affairs published in September 2020 and submitted as item of evidence No 5 in document WK 13842/2020 INIT, and several items of evidence in document WK 14796/2020 EXT 4, namely the article published on the website ‘cepa.org’ on 30 July 2020, the article published on the website ‘naviny.belsat.eu’ on 15 October 2015, the article published on the website ‘news.tut.by’ on 13 December 2016, the article published on the website ‘en.belapan.by’ on 9 July 2020, and the article published on the website ‘russian.rt.com’ on 22 March 2016, are consistent on the fact that it is only possible to carry out significant economic activities with the endorsement of President Lukashenko’s regime. Among those articles, the article published on the website ‘currenttime.tv’ and the report of the Finnish Institute of International Affairs mention the applicant as one of the businesspersons whose activities benefit from such endorsement.

71 It is also apparent from those items of evidence that the activities of prominent businesspersons in Belarus are highly dependent on the regime of President Lukashenko and that, in order to attain such a position, it is necessary to belong to a restricted group of persons who enjoy President Lukashenko’s trust. Moreover, the loss of President Lukashenko’s support results not only in a loss of influence, but also in repression which may be directed at individuals who are considered by him no longer to be part of those trusted persons. The article published on the website ‘currenttime.tv’ refers to the applicant as part of the restricted group of persons who enjoy President Lukashenko’s trust.

72 The applicant claims that some of the documents in the Council’s file are unrelated to him and cannot, in any event, support the conclusion that he benefits from and supports the regime of President Lukashenko. In particular, the applicant submits that, although it may be inferred, inter alia, from the article published on the website ‘news.tut.by’, referred to in paragraph 70 above, that certain ‘oligarchs’ benefited from their political affiliation to the regime of President Lukashenko, that conclusion does not apply to the applicant, given that he has never held any public office.

73 However, it is apparent from that article that the evolution of the autocratic political system in Belarus has produced its own type of businessperson closely associated with the authorities – the ‘Belarusian oligarchs’ – whose proximity to the regime is expressed not only in terms of ‘political and social attributes’ by holding public office as a deputy, a senator, or a member of a pro-government party, but also by participating in profitable projects within the framework of public-private partnerships.

74 In addition, as stated in paragraphs 70 and 71 above, several items of evidence relating to the economic situation in Belarus specifically mention the applicant as part of the restricted group of persons who enjoy President Lukashenko’s trust and one of the businesspersons whose activities benefit from the endorsement of the latter’s regime.

75 In the light of all the foregoing, the Council did not make an error of assessment in finding that, in the context described in paragraphs 69 to 74 above, the fact that the applicant is one of the leading businesspersons in Belarus who has financial interests, inter alia, in the petroleum, coal transit and banking sectors, and who is a co-owner of Bremino-Grupp, a company which benefited from tax relief and other forms of support from the Belarusian authorities, constitutes a sufficiently specific, precise and consistent body of evidence to establish that the applicant benefits from and supports the regime of President Lukashenko.

76 Accordingly, the single plea in law must be rejected and, consequently, the action must be dismissed in its entirety.

77 Under Article 134(1) of the Rules of Procedure of the General Court, the unsuccessful party is to be ordered to pay the costs if they have been applied for in the successful party’s pleadings. Since the Council has applied for costs and the applicant has been unsuccessful, the latter must be ordered to bear his own costs and to pay those incurred by the Council.

	[Home] [Databases] [World Law] [Multidatabase Search] [Help] [Feedback]
	Court of Justice of the European Communities (including Court of First Instance Decisions)
You are here: BAILII >> Databases >> Court of Justice of the European Communities (including Court of First Instance Decisions) >> Varabei v Council (Common foreign and security policy - Restrictive measures taken in view of the situation in Belarus - Freezing of funds - Judgment) [2023] EUECJ T-245/21 (08 November 2023) URL: http://www.bailii.org/eu/cases/EUECJ/2023/T24521.html Cite as: [2023] EUECJ T-245/21

Court of Justice of the European Communities (including Court of First Instance Decisions)