Memorandum by Ms Rachel Barnes, Chamber
of Clive Nicholls, QC
TARGETED FINANCIAL SANCTIONS
A. INTRODUCTION
1. This submission is intended to assist
the Committee by addressing particular issues relating to the
legal framework of targeted financial sanctions programmes established
by international organisations. Substantive economic issues, such
as the effectiveness of targeted financial sanctions, or indeed,
more general economic or trade embargos, are not addressed in
this paper since these are beyond the author's expertise.
2. While the primary focus of the Committee's
inquiry falls upon questions of economics, it is respectfully
suggested that the legal implications of sanctions programmes
should also be included in any consideration of these issues.
While traditionally thought of as tools of economic policy, sanctions
have significant effects upon the legal rights and interests of
interests and other entities. This is so not only in respect of
those entities against whom sanctions are directly applied, but
also upon the rights and interests of non-targeted third parties,
be they members of civilian populations or dependent relations
or business partners of targeted individuals and entities.
3. The substantive discussion contained
within this paper begins in Section B with a short description
of the development of targeted sanctions, otherwise known as "smart
sanctions". Section C then highlights some of the problems
associated with establishing clear objectives in targeted sanctions
programmes and the failure to address these issues adequately.
The effects of targeted sanctions upon the legal rights and issues
of the individuals and other entities against whom such sanctions
are applied are briefly described in Section D. Section E considers
the potential adverse consequences for non-targeted third parties
whose rights and interests are affected by the operation of targeted
sanctions programmes. Since the submission of evidence on the
effects of targeted sanctions upon third parties was specifically
invited by the Committee, discussion of this issue is more substantial
than that contained in the preceding sections.[2]
4. Unless otherwise stated, the discussion
herein concerns targeted financial sanctions programmes established
by inter-governmental organisations, such as the United Nations
and the European Union. The UK government generally plays an important
role in programmes established through these organisations, both
in terms of its input into their establishment and development,
and in implementing the particular measures contained within the
programmes. As a permanent member of the UN Security Council,
the UK has a particularly important role with respect to UN sanctions
programmes.
5. This paper aims only to introduce and
provide a broad overview of certain legal issues arising from
the operation of targeted financial sanctions. Should the Committee
feel that it would be assisted by further submissions focused
on particular areas of concern, the author would be happy to address
those areas in greater detail at a later stage.
6. The evidence presented in this paper
is based primarily upon doctoral research conducted between 2002
and 2005 at Cambridge University's Faculty of Law. This research
examined in detail one particular international targeted sanctions
programme, namely the UN Security Council's programme of targeted
sanctions against persons identified as being associated with
either Al-Qaida or the Taliban. Many of the issues that arise
in relation to that specific sanctions programme are, however,
also applicable to targeted sanctions more generally.
B. TARGETED FINANCIAL
SANCTIONS—AN
OVERVIEW
7. As the Committee is no doubt aware, the
use of targeted sanctions by intergovernmental bodies (such as
the UN) grew out of substantial disquiet throughout the 1990s
with the effects of broad economic embargos upon the civilian
populations of targeted States.[3]
This led both to a greater public emphasis by, amongst others,
the UN Security Council on managing the negative humanitarian
effects of general economic sanctions against States,[4]
and also to the development of so-called "smart sanctions".
These are sanctions that were intended to target either (i) specific
persons or entities linked to the governing regime or (ii) specific
economic sectors of the State or geographic area in question.[5]
Latterly, targeted or smart sanctions have been applied against
individuals and entities with no necessary connection to a particular
State or to a de facto governmental regime within a geographic
area. Examples of this more recent application of smart sanctions
to non-State actors are the various counter-terrorism targeted
sanctions programmes.[6]
8. Sanctions programmes that are targeted
against specific persons generally operate according to a list
system. In other words, the body responsible for administering
the sanctions programme maintains a list of individuals and entities
against which the restrictive measures within the programme must
be applied. At the UN level, examples of such programmes include
the Security Council's programmes relating to Al-Qaida and the
Taliban, Liberia, Sierra Leone, and the former regime in Iraq.
In each of these cases, the Security Council's sub-committee responsible
for administering the relevant programme maintains a list of individuals
and entities against whom all UN Member States are required to
apply the sanctions imposed through the programme. In addition
to financial sanctions, these programmes generally also impose
travel bans against the individuals designated on their respective
lists, and may also include other measures such as weapons controls.
9. Individuals and entities designated on
a sanctions list can typically be thought of as being either primary
or secondary targets. The primary targets are those directly involved
in committing the bad conduct that is being targeted under the
particular sanctions programme. For example, Osama bin Laden and
individuals directly responsible for committing acts of terrorism
linked to Al-Qaida are some of the primary targets of the UN's
Al-Qaida/Taliban sanctions programme. Secondary targets of this
programme include individuals and entities who, while they may
not be directly involved in commissioning or committing acts of
terrorism, are deemed to be "associated with" those
previously identified as primary targets. In very simple terms,
the primary rationale behind the application of restrictive financial
measures against these secondary targets is, generally speaking,
to reduce or block the flow of economic resources to the primary
targets in an attempt to prevent their commission of the bad conduct
in question.
10. At the EU level, there are a number
of targeted sanctions programmes, some of which represent the
implementation of the UN Security Council sanctions programmes
within the EU, while others are independent EU programmes.[7]
In the case of the former, while the EU publishes lists of persons
against whom sanctions must be applied, these are simply reproductions
of the lists managed by the UN Security Council sub-committees
and the EU has no direct control over the addition or removal
of persons to or from those lists.
C. THE NEED
FOR CLEAR
AND COHERENT
POLICY OBJECTIVES
11. A frequent complaint of sanctions programmes
organised through international bodies such as the UN is the lack
of clear and transparent objectives. Over at least the past decade,
writers have been urging the Security Council to set dear objectives
when establishing sanctions programmes, for both effectiveness
and equitable reasons.[8]
One of the difficulties with achieving this seems to be that during
the diplomatic negotiations of a UN Security Council resolution
there is often pressure for a certain measure of ambiguity and
lack of specificity to enable a consensus to be reached amongst
Council members. This should, however, be resisted when establishing
sanctions programmes and, as one of the permanent members of the
Council, the UK government has particular responsibilities in
this regard. In the context of membership of the EU, this political
pressure within the UN Security Council is particularly significant
since the European Community's courts have been reluctant to consider
in any meaningful detail the objectives of EC regulations implementing
UN sanctions programmes. Instead, the EC Court of First Instance
and the European Court of Justice have focussed upon the broad
objective of implementing the relevant UN Security Council resolutions
and thereby contributing to coordinated international action to
maintain international peace and security, in lieu of any detailed
consideration of the professed objectives of the particular sanctions
programmes and how the restrictive measures in question will contribute
to those objectives.[9]
12. The need for clear and transparent objectives
is especially important in the context of targeted sanctions.
Not only are well-defined goals are necessary to establish "clear
criteria for determining how the measures are to be imposed, their
duration, and their effectiveness",[10]
in the context of targeted sanctions against individuals and other
non-State entities, natural justice and fairness would seem to
require it. These targeted sanctions programmes are particularly
draconian administrative measures which aim to restrict designated
persons' access to any financial or economic resources for an
indeterminate—possibly permanent—basis. Other issues
of human rights aside, a basic concept of fairness would seem
to require that it be clearly communicated to these individuals
and other non-State entities why they are being targeted and what
the inter-governmental organisation in question aims to achieve
by taking this action against them.
13. Sanctions programmes that form part
of an international response to terrorism seem to attract particular
difficulties formulating clear and coherent programme objectives,
save from the highly abstracted objective of preventing and suppressing
terrorism. These difficulties may spring at least in part from
the problems inherent in defining terrorism but they also seem
to arise because of the differences between the individuals, groups
and other entities being targeted. Unless objectives can be specified
in relation to these different targeted persons, there will not
be adequate guides of when the measures can be lifted (for example,
identifying what the targeted persons must do to "rehabilitate"
themselves in order to be de-listed, if indeed, one of the programme's
objectives is to provide incentives for behavioural change) and
criteria by which to assess the effectiveness of the programme.
14. When considering the policy objectives
of sanctions programmes, the Committee may find it helpful to
conceptualise them in terms of first-order and second-order objectives.
First-order objectives are programme-specific and relate to the
question of why the inter-governmental organisation has established
the particular programme in question and what it is seeking to
achieve through it. Second-order objectives are common to a number
of sanctions programmes and relate to broader aspects of international
sanctions practice, such as adopting a more rule-oriented approach,
applying principles of humanitarian law, and avoiding or minimising
unintended harm to third parties incurred as a direct result of
the operation of a sanctions programme.
15. To use the example of the UN Security
Council's Al-Qaida/Taliban programme, the Security Council has
not dearly articulated either the first-order or second-order
objectives of this sanctions programme. First, whilst the Council
may be in the process of clarifying the primary targets of the
Al-Qaida/Taliban programme and the bad conduct allegedly committed
by them, it has still not clearly articulated its objectives in
relation to these groups (ie, its first-order objectives). Although
it presumably aims to stop the bad conduct that it has identified
(acts of terrorism and other political violence), the Council
has not specified how it intends to do this through the application
of financial sanctions under the Al-Qaida/Taliban programme. For
example, it has not specified whether the objectives of the programme
are simply to contain the activities of the targeted groups by
cutting the flow of economic resources necessary to commit acts
of violence; or whether these objectives may also include, under
certain circumstances, promoting a change in strategies by some
groups by rewarding those that renounce violence as a means of
achieving political goals through the lifting of the sanctions
against them. In short, the Council has not identified its own
"end-goals" and, specifically, the circumstances under
which the sanctions under the Al-Qaida/Taliban programme might
be ended—either in their entirety or in relation to particular
targets only.
16. The lack of clear first-order objectives
can also cause immediate problems in the operation of the sanctions
programme, and in the case of the UN Al-Qaida/Taliban programme
this is already causing problems in relation to the national peace
and reconciliation process promoted by the Afghan government.[11]
A number of individuals participating in the Afghan reconciliation
process are still designated under the UN's sanctions programme.
The Security Council's sanctions committee has stated that, from
its perspective, participation in this national reconciliation
process can only follow after de-listing by the Security Council's
sub-committee.[12]
Yet, as described below in Section D, de-listing in this sanctions
programme is subject to the vagaries of international politics
and can effectively be vetoed by any member of the Security Council.
Thus, there is the possibility that the UN's sanctions programme
could operate as a block to a process of national reconciliation,
potentially damaging the prospects of peace in that region, which
the Security Council has classified as a matter of international
peace and security.
17. In relation to second-order objectives,
some measures designed to achieve these more general objectives
have been incorporated into the Al-Qaida/Taliban programme. These,
however, have been introduced on an ad hoc basis in response to
specific political pressures rather than as part of a dear and
coherent strategy. For example, thus far, little public consideration
has been given to the way in which this targeted sanctions programme
may affect members of civilian populations and other non-targeted
third parties and what measures could be introduced to ameliorate
any unintended negative consequences.
D. EFFECTS UPON
INDIVIDUALS AND
ENTITIES DESIGNATED
UNDER TARGETED
SANCTIONS PROGRAMMES
18. When targeted financial sanctions are
applied against individuals and other non-State entities (such
as corporations or charities), the economic rights and interests
of those targets are significantly restricted, since the aim is
to block the use, control and receipt of any economic assets by
the targeted entities.[13]
These restrictions are draconian in their nature and are designed
to be, and are often formulated as temporary emergency measures.
Nonetheless, where the sanctions programme is not clearly defined
and there is no clear end-point to the programme itself (such
as programmes relating to terrorism), these substantial restrictions
could, in practice, be applied against targets on a long-term
if not permanent basis.[14]
19. Even though there it is now recognised
that humanitarian exceptions should be built into targeted sanctions
programmes to allow designated individuals the bare means of living,[15]
there must also be a mechanism to ensure that these exceptions
are accessible as a practical matter. This problem has arisen
in the UN's Al-Qaida/Taliban programme where a designated person
makes a request to the relevant Member State for the release of
funds under the humanitarian exception provisions and that Member
State is not inclined, for whatever reason, to release any funds
and to forward the application to the UN administration. This
issue has been under review within the UN for some time and it
has previously been suggested that Member States be required to
notify the sanctions committee of all applications whether or
not they are minded to grant them. In the EU, the Court of First
Instance has tried to ameliorate this situation by interpreting
the obligations of EU Member States to include the good faith
consideration of all applications for humanitarian exceptions
and, as part of that, examining the needs of the applicant.[16]
20. The most significant legal issues arising
from the use of targeted sanctions programmes concern the ability
of persons to challenge their designation on the target lists
and to petition for de-listing. This is especially important where
the sanctions programmes use broad standards for designation purposes
such as being "associated with" the programme's primary
targets.[17]
Where such broad designation criteria are employed, rather than
requiring a showing that a designated individual or entity has,
directly or indirectly, contributed to the bad conduct that is
being targeted through the establishment of a sanctions programme,
the restrictive measures may be applied against some secondary
targets that make no effective contribution to that bad conduct.
In these circumstances, it is arguable that applying sanctions
will not further the programme's objectives of suppressing and
preventing that bad conduct. If these individuals and entities
are unable to challenge in a meaningful way the appropriateness
of their designation under the programme, calls for due process
within the programme will not be based simply on normative arguments
or issues of international credibility and encouraging States'
participation in the programme (although these are important considerations
in their own right). Under these circumstances, the provision
of procedural protections is not an end in itself but rather a
means by which the potentially overbroad application of sanctions
under a sanctions programme can be ameliorated.
21. In short, certainly with respect to
targeted sanctions programmes established by the UN Security Council,
designated persons have no right to a fair hearing before the
body responsible for their inclusion on the sanctions lists, namely
the relevant sanctions committee of the Security Council. Although
the need to incorporate sufficient due process protections for
designated individuals and other non-State entities has been recognised
as a basic principle by the EU Member States,[18]
in relation to UN Security Council sanctions there has not been
any adequate resolution of these issues. Moreover, the EC Court
of First Instance has held that precluding designated persons
from effectively challenging their inclusion on sanctions lists
established by the UN Security Council before either the relevant
UN sanctions committee or any judicial or quasi-judicial body
is not incompatible with the EC law.[19]
22. Thus, designated persons against whom
sanctions are applied under, for example, the UN's Al-Qaida/Taliban
programme, are left in a position in which they may be unable
to have their claims for de-listing heard with due process in
any forum. First, they cannot obtain due process before the Security
Council sanctions committee, as the programme does not provide
any right to be heard by the committee or to know the evidence
used to support the designation. Secondly, they cannot obtain
relief from the restrictive measures against them in the States
which implement the sanctions (implementing States) as these States
are formally bound under international law by the Security Council
resolutions in question. Implementing States are, therefore, unable
to determine unilaterally whether persons on the UN Consolidated
List were properly designated. Thirdly, the Security Council does
not require Member States to afford designated persons any due
process should they seek relief in the jurisdiction of the designating
State.
23. Under these circumstances, it seems
now that the following sentiment of Professor Elihu Lauterpacht
(although expressed in a different context) seems to be especially
pertinent:
It would be a strange reversal of positions if
the fundamental right to due process of law and fair trial, at
long last internationally recognised as belonging to the individual,
should now come to be denied by the Security Council to [those]
affected by its decisions![20]
E. ADVERSE CONSEQUENCES
OF TARGETED
SANCTIONS FOR
NON-TARGETED
THIRD PARTIES
(i) Summary
24. The Committee has indicated that it
wishes to receive submissions relating to the question of whether
targeted sanctions cause adverse consequences for third parties
that are not the intended targets of the sanctions.[21]
This is an important question that has not yet received adequate
consideration within the commentary surrounding targeted sanctions.
A more extensive discussion, with particular examples from the
UN's Al-Qaida/Taliban programme, therefore follows this summary.
25. Since targeted sanctions were developed
to reduce the humanitarian consequences of general sanctions or
embargos, and because they are a relatively recent development
with a corresponding lack of easily accessible empirical data
concerning their implementation and effects, there has been a
slowness in recognising that targeted sanctions programmes may
themselves also cause unintended humanitarian consequences for
non-targeted third parties. Although this situation does now appear
to be improving, there is still a need for those concerned with
developing and managing sanctions programmes to appreciate the
potential consequences for non-targeted third parties. There is
also a need to ensure that mechanisms exist within the programme
(i) to analyse the (potential) impact on non-targeted third parties;
and (ii) to take action to prevent and reduce those unintended
adverse consequences. Furthermore, there should be mechanisms
in place—as in some general economic sanctions programmes—to
ensure that if the application of targeted sanctions against a
particular entity would necessarily cause disproportionate negative
consequences for non-targeted third parties, then the sanctions
should not be applied against that targeted entity.[22]
For such an evaluation based upon a principle of proportionality
to be conducted, clear programme objectives need to be established
against which the likely harm to third parties can be considered
(see section C above).
(ii) Historical examples of effects of economic
sanctions upon third parties
26. The fact that general economic sanctions
against States may cause unintended adverse consequences for third
parties, such as trade partners, has long been recognised and,
indeed, is recognised in the UN Charter itself. Article 50 of
the UN Charter enables the Security Council to make some provision
for third States adversely affected by enforcement measures taken
against another State. It provides as follows:
If preventive or enforcement measures against
any state are taken by the Security Council, any other state,
whether a Member of the United Nations or not, which finds itself
confronted with special economic problems arising from the carrying
out of those measures shall have the right to consult the Security
Council with regard to a solution of those problems.
27. As is clear from the words of Article
50, this is limited to enforcement actions taken against States—and
so would be inapplicable in relation to Security Council sanctions
programmes against non-State targets, such as the Al-Qaida/Taliban
programme.[23]
Also, in accordance with the inter-State paradigm of the United
Nations, Article 50 only allows State actors to present their
cases before the Council. Individuals and entities affected by
Council enforcement action against States can only seek relief
through the usual rules of diplomatic protection. This means that
they would have to petition the governments of their States of
citizenship, residence or incorporation for relief, which would,
in turn, request assistance from the Security Council under Article
50.
28. Attempts by non-State third parties
to seek relief directly from a subsidiary body of the Security
Council to compensate for the negative consequences of a UN sanctions
programme have been unsuccessful, as the example of the German
company, Dorsch Consult Ingenieurgesellschaft GmbH, demonstrates.
This company sought relief from the United Nations Compensation
Commission (the "UNCC") in relation to negative consequences
it suffered as a result, it claimed, of the UN sanctions against
Iraq. The UNCC was established by the Security Council to determine
compensation for individuals and entities who suffered losses
as a result of Iraq's invasion of Kuwait in 1990, and early in
its existence the UNCC clarified that compensation would not be
payable for losses resulting solely from the economic embargo
against Iraq and related measures adopted by the Security Council.[24]
The company's application was therefore dismissed.[25]
29. This company also brought an unsuccessful
claim for compensation against the EC (which had implemented the
UN sanctions) for a loss of almost DM 3 million, equivalent then
to approximately US$ 1.5 million. In its claim, the company asserted
that its loss was the amount of a debt unpaid by Iraq in retaliation
for the economic sanctions imposed upon the country by the Security
Council after the invasion of Kuwait in 1990.[26]
In this case, the EC Court of First Instance held, inter alia,
"that the importance of the objectives of the sanctions programme
was such as to justify negative consequences, even of a substantial
nature, for some operators and could not therefore render the
Community liable."[27]
The CFI's judgment was upheld by the European Court of Justice.
30. Another example of adverse consequences
being suffered by third parties is that of Bosphorus Airways in
the context of the UN sanctions against the Former Republic of
Yugoslavia (Serbia and Montenegro) ("FRY").[28]
The UN sanctions were implemented by the EC through a number of
Community regulations,[29]
and pursuant to these measures, the Irish Government impounded
an aircraft stationed at Dublin airport. This aircraft was operated
by a Turkish company, Bosphorus Airways, under a four-year lease
from a Yugoslav Airlines, a FRY undertaking, pursuant to which
Bosphorus had full day-to-day operational control and direction
of the aircraft.[30]
Payments under the lease agreement had been made into an account
held at the Turkish Central Bank which had been blocked in accordance
with the Security Council sanctions resolutions so that no funds
were reaching Yugoslav Airlines.[31]
As noted by the ECJ, there was no suggestion that Bosphorus was
in any way attempting to break the UN sanctions.[32]
The ECJ employed a broad interpretation of the relevant Community
regulation and UN Security Council resolution and upheld the impounding
of the aircraft despite the substantial negative consequences
for Bosphorus Airways, the non-targeted third party. The Court
justified its position in the following way:
Any measure imposing sanctions has, by definition,
consequences which affect the right to property and the freedom
to pursue a trade or business, thereby causing harm to persons
who are in no way responsible for the situation which led to the
adoption of the sanctions.
Moreover, the importance of the aims pursued
by the regulation at issue is such as to justify negative consequences,
even of a substantial nature, for some operators.[33]
(iii) Targeted sanctions programmes
31. As stated above, there is a lack of
awareness (or acknowledgement) of the potential for "smart
sanctions" that are targeted against specifically designated
individuals and entities to have negative consequences for non-targeted
third parties. Although this is gradually changing, targeted sanctions
programmes generally have not incorporated formal measures to
analyse and respond to situations of adverse consequences for
non-targeted third parties should they arise or be identified
as likely to arise. Instead, there are a few isolated examples
of ad hoc measures taken independently by a small number
of States in their implementation of the sanctions. The following
discussion of the potential negative consequences of targeted
sanctions for third parties distinguishes between those with specific
and individual connections with the targets, for example, dependents
and creditors, and those with more general links, such as beneficiaries
of charitable services provided or funded by a targeted entity.
(a) Dependants, Heirs and Creditors
32. The dependants, heirs and creditors
of persons designated under a targeted sanctions programme will
have an expectation of receiving funds from that designated person
and their interests will be prejudiced if those funds are not
forthcoming as a result of a targeted sanctions programme. In
general, targeted financial sanctions programmes require States
to block all assets and other economic resources belonging to
or controlled by a designated individual or entity, notwithstanding
that these resources may be used for the benefit of or owed to
another.
33. An obvious example is the position of
the spouse and dependant children of a designated individual whose
assets have been frozen and to whom it is unlawful to transfer
any further economic resources. Such a situation was considered
by the English High Court in 2001 in a case in which social security
payments, including income support and housing benefit, to the
designated person had been stopped.[34]
Although the Court found that this matter was not yet ripe for
determination,[35]
it did observe that while the sanctions against Mr Othman were
not aimed at Mrs Othman and their children, their application
would result in hardship for them and could even result in the
family being evicted from their home for non-payment of rent.[36]
While the European Court of First Instance has recently held that
EU Member States must consider the needs of targeted individuals
when considering their applications for certain exceptions from
restrictive financial measures under targeted sanctions programmes
on humanitarian grounds, it did not address the question of the
humanitarian needs of dependants.[37]
(b) Beneficiaries of Civilian Services
34. When restrictive financial measures
are applied under a targeted sanctions programme against entities
that either provide or fund services for members of civilian populations,
it is logical to assume that those civilian beneficiaries will
suffer when the targeted sanctions bite and the designated entities
cannot continue to provide or fund the services they rely upon.
Thus, notwithstanding that by their very nature targeted sanctions
programmes are not general embargos applied against a wide range
of civilian targets, they may still have significant negative
consequences for civilian populations when sanctions are applied
against charitable organisations and other entities that provide
services to those populations.
35. Although a substantial body of data
confirming this contention is still lacking, such effects have
been documented in one study of the application of counter-terrorism
sanctions against service entities operating in the Occupied Palestinian
Territories.[38]
This paucity of rigorous empirical evidence can be seen as both
a cause and an effect of the lack of awareness of the issue of
negative consequences for third parties within the commentary
surrounding targeted sanctions. Although this situation is improving
slowly, it has not yet translated into concerted action by inter-governmental
organisations to develop strategies to prevent or at least minimise
the potential impact upon civilian populations.[39]
As described above, targeted financial sanctions programmes do
now have humanitarian exception provisions to prevent, in theory,
targeted individuals being left without any means of survival.
These humanitarian exceptions provisions have not yet, however,
been specifically extended to consider the situation of non-targeted
third parties. While there has recently been some limited acknowledgement
that the application of sanctions against a legal entity does
not necessarily require that its operations cease in their entirety,[40]
there is little guidance to assist states in establishing humanitarian
licensing systems or other practical methods of minimising the
humanitarian effects of targeted sanctions. Instead, the growing
body of literature and international guidance concerning targeted
sanctions tends to focus—understandably—upon the need
for due process and fairness for the targeted individuals and
entities.[41]
36. UN targeted sanctions programmes against
non-State individuals and entities do not generally contain civilian
humanitarian assessment provisions. In contrast, UN sanctions
programmes against States or de facto government regimes
do, generally speaking, require periodic humanitarian assessments
to analyse the extent to which the sanctions are negatively affecting
the civilian populations in the State or geographic area in question.[42]
(So, for example, such provisions were initially included the
UN sanctions programme against the Taliban when it was first established
in 1999 since, at that time, the Taliban effectively comprised
the governmental regime in Afghanistan.[43])
Examples from the UN's Al-Qaida/Taliban Sanctions
Programme
37. The UN Consolidated List managed by
the Security Council's Al-Qaida/Taliban Committee includes a number
of entities that provided a variety of services to civilian populations,
including humanitarian or charitable services. These service entities
have been placed on the UN Consolidated List on the basis of accusations
of providing support to members of the Al-Qaida network and of
using their charitable or corporate structure to channel resources
to those linked to Osama bin Laden and Al-Qaida.[44]
Whatever the veracity of the claims against these organisations,
it has not generally been contested that they also engaged in
genuine service activities.
38. According to one member of the Security
Council's Al-Qaida/Taliban sanctions committee, when a charitable
organisation is designated and placed upon the UN Consolidated
List, its charitable status is noted by the sanctions committee.[45]
There is, however, no formal process of assessing whether applying
financial sanctions against the organisation will have any humanitarian
impact upon the beneficiaries of its charitable services (as there
generally is in UN sanctions/embargo programmes against States)
and, if so, whether any additional measures could be taken to
ameliorate those unintended adverse consequences.
39. While the UN Security Council's Al-Qaida/Taliban
sanctions committee has this year approved, for the first time,
exceptions to the programme's restrictive financial measures to
enable a business owned by a designated person to continue to
operate, the Al-Qaida/Taliban Monitoring Team (which supports
the sanctions committee in managing the programme) has suggested
that such measures would not be appropriate for charities involved
in international transfers of funds.[46]
This could mean that the potential effects of the sanctions upon
a very substantial number of non-targeted third parties will not
be addressed in any meaningful way. To provide a flavour of the
potential effects for non-targeted civilian beneficiaries, a brief
background to some of the service entities designated under the
Al-Qaida/Taliban sanctions programme and the services they previously
provided is given below.
(a) The Al-Rashid Trust, based in Pakistan,
was listed by the Al-Qaida/Taliban Committee on 6 October 2001.[47]
Then, on 24 April 2002, the Committee listed the Aid Organization
of the Ulema, Pakistan[48]
which, according to the US Treasury, was simply the Al-Rashid
Trust operating under a new name.[49]
Along with the allegations of financing acts of violence, the
charitable activities of the Al-Rashid Trust have been widely
reported and there have been no suggestions that the Trust was
not engaged in at least some genuine humanitarian projects, including
operating bakeries and providing shelter for a significant number
of internally displaced families in Afghanistan.[50]
(b) In 2004, the Al-Qaida/Taliban Committee
designated the Al-Haramain Foundation and included 14 Al-Haramain
entities on the UN Consolidated List. Described as one of Saudi
Arabia's leading charities,[51]
the Al-Haramain Foundation had offices around the world and has
provided aid and welfare services in, for example, Afghanistan,
Albania, Bangladesh, Bosnia-Herzegovina, Ethiopia, Indonesia,
Kenya, Pakistan and Tanzania. It has been reported that the Al-Haramain
Foundation's annual revenue from donations was between $40 and
$50 million and that the charity has spent $300 million on providing
international humanitarian aid.[52]
The US Treasury describes the Foundation as "represent[ing]
itself as a private, charitable, and educational organization
dedicated to promoting Islamic teaching throughout the world"
and as being "one of the principal Islamic non-governmental
organizations active throughout the world".[53]
Originally only the Al-Haramain branches in Somalia and Bosnia-Herzegovina
were accused of being linked to Al-Qaida and, in March 2002, the
US and the Saudi governments had made a joint designation proposal
which was accepted by the Security Council's Al-Qaida/Taliban
Committee.[54]
In 2004, the US then accused other Al-Haramain branches of involvement
in terrorist financing and with Saudi Arabia proposed their listing
by the Al-Qaida/Taliban Committee.[55]
The Saudi headquarters of the charity has not been listed but
the former head of the organisation was apparently removed from
his post by the Saudi authorities at the request of the US[56]
and subsequently the Foundation was dissolved. Its operations
and assets are now controlled by the recently established Saudi
National Commission for Charitable Work Abroad.[57]
(c) The Benevolence International Foundation
("BIF") had offices in Afghanistan, Azerbaijan, Bangladesh,
Bosnia-Herezegovina, Canada, Chechnya, China, Croatia, Daghestan,
Gaza in the Occupied Palestinian Territories, Georgia, Ingushetia,
the Netherlands, Pakistan, Russia, Sudan, Saudi Arabia, Tajikistan,
the UK, the US, and Yemen. Following a submission by the US, it
was placed on the UN Consolidated List in November 2002.[58]
The BIF and Enaam Amaout, its former chief executive officer in
the US, have been the subject of several civil and criminal actions
in that jurisdiction.[59]
Nonetheless, as noted by the US court before which Amaout was
prosecuted, "[t]here can be no serious dispute that BIF provided
significant humanitarian aid to Chechen refugees, widows and orphans
during 1999-2001".[60]
According to the Al-Qaida/Taliban Committee's Monitoring Team,
since it began in 1992 the BIF has provided "tens of millions
of dollars of `humanitarian aid' to regions around the world"
and of this amount, it has been determined by a US court that
in the region of $300,000 had been diverted to support persons
engaged in military activities.[61]
(d) In December 2001, the US temporarily
designated the Global Relief Foundation ("GRF") under
its domestic counter-terrorism sanctions for alleged links with
Al-Qaida and Hamas,[62]
and listed it permanently on 18 October 2002.[63]
The organisation was designated by the UN Security Council's Al-Qaida/Taliban
Committee on 22 October 2002.[64]
GRF was apparently one of the largest Muslim charities in the
US and funded humanitarian operations in approximately 25 locations,
including Afghanistan, Albania, Bosnia, Kosovo, Iraq, the Lebanon,
Pakistan, the West Bank and Gaza in the Occupied Palestinian Territories,
Chechnya, Ingushetia, Somalia and Syria.[65]
The US claims that GRF has links with members of Al-Qaida and
the Taliban but it does not specifically allege that it has transferred
funds or other resources to individuals or entities engaged in
terrorist activities, although it does claim that money was received
from "a suspected financier of al-Qaida".[66]
GRF and its founder, Rabih Sami Haddad, became something of a
cause celebre in the US following the US government's actions
and their supporters were reported to include a member of the
US Congress.[67]
Mr Haddad, a Lebanese citizen, was removed from the US in 2003
for immigration offences[68]
and the assets of GRF remain frozen following unsuccessful legal
challenges to the government's action.[69]
(e) The Al-Barakaat group is another example
of an entity designated under the UN's Al-Qaida/Taliban sanctions
programme that provided necessary civilian services. Not a charitable
institution but a group of commercial enterprises, the Al-Barakaat
group nonetheless provided vital non-violent services to large
numbers, predominantly in Somalia. Shortly after Al-Barakaat's
inclusion in the UN Consolidated List in 2001,[70]
the BBC reported that an estimated 60 per cent of Somalia's population
relied on its financial services and that, in addition to the
tens of thousands of Somalis who lost their income from funds
remitted by their relatives abroad through Al-Barakaat's money
transfer network, many Somalis were unable to access the money
they had placed in accounts in the banking arm of Al-Barakaat
and the 40,000 subscribers of Al-Barakaat's telecom business were
left without services as a consequence of the sanctions.[71]
"Rally around the flag" Effect
40. Shutting down the operation of particular
service entities by designating them under targeted sanctions
programmes may well contribute to the aims of the those programmes
by, for example, restricting the flow of funds to those who commit
the particular bad conduct that is being targeted, and it is not
the purpose of this paper to challenge the efficacy of that strategy.[72]
It should, however, be noted that the application of financial
sanctions against service entities may also frustrate the aim
of suppressing and preventing the bad conduct linked to sanctions
programmes' targets if those targets can successfully characterise
the adverse consequences felt by civilians as being part of a
deliberate policy of those States or inter-governmental organisations
responsible for administering the sanctions programmes in question.
This would not be dissimilar to a phenomenon identified in the
literature of general economic sanctions called the "rally
around the flag effect".[73]
In the situations in which this effect has been identified, the
targeted States' ruling elites managed to make political capital
from harm suffered by their constituents, the ordinary members
of the population, by successfully characterising this harm as
resulting from the sanctions imposed by the international community.[74]
It is possible that a similar effect might occur in the context
of current counter-terrorism sanctions, whereby negative effects
upon civilian beneficiaries of targeted Muslim charities could
play into the hands of those promoting the notion of the Muslim
world being under attack by the "West In this situation,
these effects could be used as an example of how the "West",
exemplified by the UN Security Council, is taking food and shelter
from widows and orphans by trying to shut down well-known Islamic
charitable organisations.[75]
Sentiments that could contribute to such an effect have been expressed
in at least one newspaper article which explored the effect of
counter terrorist-financing measures on the Muslim charitable
sector. The article ended with the following quotation from someone
who works within that sector, who said "[c]haritable giving
is [a] pillar of Muslim beliefs, when someone attacks it, it is
like attacking those beliefs."[76]
Examples of Attempts to Ameliorate Unintended Adverse
Consequences of Targeted Sanctions
41. Despite the lack of a systematic international
approach to these issues, there are some isolated examples of
individual States attempting, on an ad hoc basis, to meet their
international sanctions obligations in a way that takes account
of, and tries to ameliorate, unintended adverse consequences for
non-targeted third parties. In relation to the UN's Al-Qaida/Taliban
programme, the sanctions committee's approval earlier this year
of exceptions to enable a designated Italian company to continue
its hotel business under the control and effective receivership
of the Italian Government is one such example. The action of Saudi
Arabia with regards to the Al-Haramain Foundation, which was described
above, could also be seen as another example,[77]
as could the approach of the Charity Commission of England and
Wales towards the British branch of the Benevolence International
Foundation.[78]
According to the statement of inquiry published by Charity Commission,
after finding no evidence of impropriety or direct links with
the US entity which was subject to proceedings in the US, the
trustees of Benevolence International (UK) were allowed to distribute
the assets of the charity (which amounted to a little over k2,000)
in accordance with its object, namely the relief of poverty in
sub-Sahara Africa.[79]
42. Another example comes from one of the
UN Security Council's other sanctions programmes. In the UN sanctions
programme against the UNITA regime in Angola, sanctions were imposed
upon a Portuguese company that operated an educational institution.
Rather than simply freezing the assets, which would mean that
the school would have been unable to operate, the sanctions were
apparently structured by the national authorities in such a way
as to enable the continued operation of the school and all the
company's income was placed in a frozen account, thereby ensuring
that these funds could not be made available to the individuals
and groups targeted by the sanctions programme.[80]
F. CONCLUDING
REMARKS
43. It is hoped that this paper has provided
an overview of some of the issues that may arise in the context
of targeted sanctions programmes. Whilst targeted sanctions are
still a relatively new development and there is a lack of empirical
economic data to assist those responsible for developing and administering
targeted sanctions programmes, it is possible to identify a number
of issues which require careful consideration by policy makers
and those responsible for administering and developing targeted
sanctions programmes. While recognition of the issues identified
in this paper is growing, particularly within the European Union,
there is still a need for this to be translated into a practical,
systematic approach designed to address these issues in concerted
and meaningful ways. Moreover, States with permanent membership
of the UN Security Council, such as the UK, have particular responsibilities
in this regard given the increasing number of international sanctions
programmes established through the UN and, importantly, the deference
of municipal and regional judicial systems to resolutions of the
Security Council adopted under Chapter VII of the UN Charter notwithstanding
their incompatibility with local laws and legal principles.
25 October 2006
2 This section of the paper responds to Question 5
in the Committee's Call for Evidence, which concerns the potential
adverse consequences of sanctions programmes. Back
3
During the 1990s, the UN Security Council had established more
than 10 sanctions programmes to address a variety of situations
it deemed to constitute threats to international peace and security
in Iraq, Somalia, Libya, the Federal Republic of Yugoslavia (Serbia
and Montenegro), Liberia, Angola, Rwanda, Sudan, Sierra Leone,
the Federal Republic of Yugoslavia (relating to Kosovo), and Afghanistan.
See UN Docs. S/RES/661 (1990); S/RES/733 (1992); S/RES/748 (1992);
S/RES/757 (1992); S/RES/788 (1992); S/RES/864 (1993); S/RES/918
(1994); S/RES/1054 (1996); S/RES/1070 (1996); S/RES/1132 (1997);
S/RES/1160 (1998); S/RES/1267 (1999), respectively. (Note that
not all of these programmes involved the imposition of economic
sanctions.)
During this period, the criticism of economic sanctions against
States on the grounds of their negative humanitarian consequences
also grew, especially as the level of civilian suffering in Iraq
became recognised. See, eg, Supplement to an Agenda for Peace:
Position Paper of the Secretary-General, UN Doc A/50/60-S/1995/1
(1995); Doxey, M.International Sanctions in Contemporary Perspective,
2nd ed (1996); World Health Organisation, The Health Conditions
of the Population in Iraq since the Gulf Crisis, (1996); Garfield,
R. Morbidity and Mortality Among Iraqi Children from 1990 through
1998-Assessing the Impact of the Gulf War and Economic Sanctions
(1999); Normand, R, "A Human Rights Assessment of Sanctions:
The Case of Iraq, 1990-1997" in van Genugten and der Groot
(eds) United Nations Sanctions (1999) pp 19-33; Simons, G, The
Scourging of Iraq: Sanctions, Law and Natural Justice, 2nd ed
(1998); OHCHR, The Human Rights Impact of Economic Sanctions on
Iraq- Background paper prepared by the Office of the High Commissioner
for Human Rights for the meeting of the Executive Committee on
Humanitarian Affairs, 5 September 2000; Bossuyt, M. The adverse
consequences of economic sanctions on the enjoyment of human rights,
working paper prepared for UN ESCOR Sub-Comm. Promotion and Protection
of Human Rights, UN Doc. E/CN.4/Sub.2/2000/33 (2000); Reinisch,
A, Developing Human Rights and Humanitarian Law Accountability
of the Security Councillor the Imposition of Economic Sanction
(2001) 95 Am J Int'l L. 851; Sassoli, M "Sanctions and International
Humanitarian Law-Commentary' in Gowlland-Debbas (ed) United Nations
Sanctions and International Law (2001) pp 241-48; Gordon, J, When
Intent Makes All the Difference in the World: Economic Sanctions
on Iraq and the Accusation of Genocide (2002) 5 Yale H R &
Dev L J 57. Back
4
See, eg, "Humanitarian impact of sanctions" non-paper
by the permanent representatives of the UN Security Council, 13
April 1995, UN Doc S/1995/300 (1995); Note by the President of
the Security Council on the Work of the Sanctions Committees,
UN Doc S/1999/92 (1999); Note by the President of the Security
Council on the establishment of an informal working group on improving
the effectiveness of UN sanctions, UN Doc S/2000/319 (2000). Perhaps
the best known of Council initiatives to manage the humanitarian
effects of general economic sanctions is the Oil-for-food programme
developed within the UN sanctions programme against Iraq, established
pursuant to Security Council resolution 986 (1995). Back
5
Early examples of the use of "smart sanctions" by the
Security Council include the restrictive measures applied against
members of UNITA in Angola and against members of the military
junta in Sierra Leone and, more recently, the trade in so-called
"blood diamonds" in that area. See, inter alia,
UN Docs S/RES/1173 (1998); S/RES/1132 (1997); S/RES/1306 (2000).
The development of international smart sanctions is an on-going
process centred largely upon three co-ordinated initiatives sponsored
by the Swiss, German and Swedish governments, namely the Interlaken,
Bonn-Berlin, and Stockholm Processes, which are inter-governmental
symposia established in the late 1990s to promote research and
understandings of international targeted sanctions programmes. Back
6
Examples of such programmes include the UN's Al-Qaida/Taliban
programme and the EU's programme of "specific restrictive
measures directed against certain persons and entities with a
view to combating terrorism" pursuant to, inter alia,
Common Position 2001/931/CFSP and Council Regulation (EC) 2580/2001. Back
7
For details of all EU sanctions programmes, see the European
Commission's webpage on EU sanctions, available at http://ec.europa.eu/external_relations/cfsp/sanctions/measures.htm Back
8
See eg, Doxey (1996) pp 119-120; Cortright and Lopez, The Sanctions
Decade, Assessing UN Strategies in the 1990s, (2000) pp 223, 232;
Cortright and Lopez, Sanctions and the Search for Security: Challenges
to UN Action (2002) p 15; Making Targeted Sanctions Effective-Guidelines
for the Implementation of UN Policy Options, The Stockholm Process
Report, 14 February 2003 (hereinafter, the "Stockholm Guidelines")
p 24, § 41; Biersteker et al, Targeted Financial Sanctions:
A Manual for Design and Implementation (Contributions from the
Interlaken Process), Watson Institute for International Studies,
Brown University, USA (2001) p 5. Back
9
See, eg, Case C-84/95 Bosphorus Hava Yollari Turizm ve Ticaret
AS v Minister for Transport, Energy and Communications, Ireland
and the Attorney General [1996] ECR I-3953, especially paras 17,
23-27; Case T-315/01, Yassin Abdullah Kadi v Council of the European
Union and Commission of the European Communities, Judgment of
21 September 2005 (CFI); Case T-253/02 Chafiq Ayadi v Council
of the European Union, Judgment of 12 July 2006 (CFI), paras 124-125
(CFI). Back
10
Biersteker et al (2001) p 5. Back
11
It is also possible that in the future, this could cause problems
in achieving peaceful settlements in other regions. For example,
in September 2005, peace negotiations between India and some Kashmiri
separatist groups were announced. While these negotiations did
not at that time include the Kashmiri group listed on the UN Consolidated
List, Lashkar-e-Tayyiba, it may be that sometime in the future
members of this group could be included in negotiations designed
to resolve the conflict in that region. (See UN Consolidated List
entry No 85, available at http://www.un.org/Docs/sc/committees/1267Template.htm)
Similarly, there may come a time when the government of the Russian
Federation elects to negotiate with the armed groups fighting
for an independent Chechen state. Back
12
See UN Doc S/PV.5375 p 5 (statement by Ambassador Mayoral, Chair
of the Al-Qaida/Taliban Committee at Security Council meeting
on 21 February 2006). Back
13
In some targeted financial programmes, humanitarian exceptions
have now been introduced to allow persons access to some minimal
funds to enable a basic standard of living. This development is
described in greater detail below. Back
14
The Court of First Instance of the EC has, however, rejected
this contention and has held that if a sanctions programme has
a provision requiring the periodic review of the programme as
a whole, then the restrictive measures upon designated individuals
and entities are temporary in nature. The Court reached this conclusion
in a case in which the applicant had been subject to restrictive
financial measures for five years. Case T-253/02 Ayadi,
paras 134-136. Back
15
Two years after the Security Council imposed financial sanctions
upon individuals under the Al-Qaida/Taliban programme, exceptions
were introduced on application to the relevant Member State where...
necessary for basic expenses, including payments for foodstuffs,
rent or mortgage, medicines and medical treatment, taxes, insurance
premiums, and public utility charges, or exclusively for payment
of reasonable professional fees and reimbursement of incurred
expenses associated with the provision of legal services, or fees
or service charges for routine holding or maintenance of frozen
funds or other financial assets or economic resources. (UN Doc
S/RES/1452 (2002) para 1(a).) Security Council resolution 1452
(2002) also allows for extraordinary exceptions to the sanctions
but these must be positively approved by the Al-Qaida/Taliban
sanctions committee before funds can be released. Back
16
Case T-253/02 Ayadi, para 132. Back
17
This is the designation standard employed in the UN Al-Qaida/Taliban
sanctions programme. See UN Doc S/RES/1617 (2005). Back
18
Council of the European Union, Guidelines on implementation and
evaluation of restrictive measures (sanctions) in the framework
of the EU Common Foreign and Security Policy, 2 December 2005,
Doc No 15114/05 PESC 1084 Fin 475, para 9. Back
19
Case T-315/01 Kadi, paras 288-290; Case T-253/02 Ayadi,
paras 141-149. Back
20
Lauterpacht, E, Aspects of the Administration of International
Justice (1991) p 48. Back
21
Call for Evidence, Question 5. Back
22
For example, in the cases of Sudan in 1996 and Afghanistan in
1999, the UN Security Council decided not to establish strong
economic embargos when the regimes of the respective countries
defied Council mandates to extradite individuals accused of involvement
in acts of terrorism. In part at least, this was because the Council
had determined, on the basis of `humanitarian pre-assessments'
conducted on behalf of the Secretary-General, that general economic
sanctions would have a disproportionately harmful effect on the
Sudanese and Afghan populations, both of which were suffering
extreme poverty and hardship after years of conflict, in comparison
with their likely efficacy in securing the extradition of the
wanted individuals. See, Cortright and Lopez (2000) pp 123-125,
129. Back
23
For discussions of Article 50 of the Charter and its invocation
in the context of economic sanctions against Southern Rhodesia,
Iraq, and the former Yugoslavia, see eg, Gowlland-Debbas, V, Collective
Responses to Illegal Acts in International Law: United Nations
Action in the Question of Southern Rhodesia (1990) pp 633-739;
Al-Khasawneh, B, "Consultation under Article 50 of the United
Nations Charter: The Experience of the Middle East" in Gowlland-Debbas
(ed) (2001); Doxey, M, "United Nations Economic Sanctions:
Minimizing Adverse Effects on Nontarget States" in Cortright
and Lopez (eds) Smart Sanctions: Targeting Economic Statecraft,
(2002) pp 183-200 at pp 187-191. Back
24
See Propositions and Conclusions on Compensation for Business
Losses: Types of Damages and their Valuation, Decision of the
Governing Council of the UNCC, 6 March 1992, UN Doc S/AC.26/1992/9
(1992) para 6; Compensation for Business Losses Resulting from
Iraq's Unlawful Invasion and Occupation of Kuwait where the Trade
Embargo and Related Measures were also a Cause, Decision of the
Governing Council of the UNCC, 18 December 1992, UN Doc S/AC.26/1992/15
(1992) para 9; UNCC Report and Recommendations Made by the Panel
of Commissioners Concerning the Third Instalment of "E3"
Claims, Governing Council of the UNCC 18 March 1999, UN Doc S/AC.26/1999/1
(1999) paras 130-134. Back
25
UN Doc S/AC.26/1999/1 (1999) paras 10(e), 130. Back
26
Case T-184/95, Dorsch Consult Ingenieurgesellschaft GmbH v Council
of the European Union and Commission of the European Communities
[1998] ECR II-667 (CFI); Case C-237/98 P, Dorsch Consult Ingenieurgesellschaft
mbH v Council of the European Union and Commission of the European
Communities [2000] ECR I-4549 (ECJ). Back
27
Case T-184/95, Dorsch, [1998] ECR II-667, para 88. Back
28
See UN Doc S/RES/820 (1993). Back
29
The Council Regulation at issue in this case was Council Regulation
(EEC) No 990/93 of 26 April 1993 concerning trade between the
European Economic Community and the Federal Republic of Yugoslavia
(Serbia and Montenegro). See, OJ L 102 (28.4.1993) p 14. Back
30
Bosphorus [1996] ECR I-3953, Opinion of Advocate-General
Jacobs para 20; Judgment para 2. Back
31
Ibid, AG Jacobs para 27; Judgment para 3. Back
32
Ibid, AG Jacobs para 22; Judgment para 3. Back
33
Ibid, Judgment paras 22-23. Back
34
R (on the application of Othman) v Secretary of State for Work
and Pensions [2001] EWHC (Admin) 1022 (Transcript, 28 November
2001). Back
35
Ibid, para 65. Thus, Mr Othman's challenge to the application
of these measures failed. Back
36
Ibid, para 58. Back
37
Case T-253/02 Ayadi, para 132. Back
38
International Crisis Group, Islamic Social Welfare Activism in
the Occupied Palestinian Territories: A Legitimate Target? ICG
Middle East Report No 13, Amman/Brussels, 2 April 2003. Back
39
The possibility that targeted sanctions may still cause unintended
harm to substantial numbers of non-targeted civilians has been
raised within general sanctions discourse, although this has not
been specifically discussed in relation to the application of
sanctions against service entities. See, eg, Stockholm Guidelines
(2003) p. 20, § 32. Back
40
See, Fourth report of the Al-Qaida/Taliban Analytical Support
and Sanctions Monitoring Team, UN Doc S/2006/154, para 59; Council
of the European Union, Restrictive Measures: EU Best Practices
for the effective implementation of restrictive measures,June
2006, Doc No 10533/06 PESC 592 FIN 257, para 52-3. Back
41
See, Council of the European Union, Basic Principles on the Use
of Restrictive Measures (Sanctions), 7 June 2004, Doc No 10198/1/04
PESC 450 REV 1; Council of the European Union, Guidelines on implementation
and evaluation of restrictive measures (sanctions) in the framework
of the EU Common Foreign and Security Policy, 2 December 2005,
Doc No 15114/05 PESC 1084 Fin 475; T Biersteker et al, (2001);
Biersteker et al, Strengthening Targeted Sanctions Through Fair
and Clear Procedures (March 2006); B Fassbender, Targeted Sanctions
and Due Process, Study commissioned by the United Nations Office
of Legal Affairs (20 March 2006); I Cameron, The European Convention
on Human Rights, Due Process and United Nations Security Council
Counter-Terrorism Sanctions, commissioned by the Council of Europe
(February 2006). Back
42
This practice of humanitarian assessments has developed since
1999 when the UN Security Council undertook to improve the work
of its sanctions committees by, inter alia, assessing the
humanitarian consequences of the sanctions regimes on the populations
of the target States and the economic consequences on third party
States, and, as a corollary, including humanitarian exceptions
in order to ameliorate the worst effects of general economic sanctions
that are suffered by civilian populations of the States against
whom sanctions are applied. See, UN Doc S/1999/92 (1999). Back
43
See, Report of the Secretary General on the humanitarian implications
of the measures imposed by Security Council resolutions 1267 (1999)
and 1333 (2000) on Afghanistan, UN Doc S/2001/695 (2001); Report
of the Security Council Committee established pursuant to resolution
1267 (1999) concerning Afghanistan, 17 January 2002, UN Doc S/2002/101
(2002) paras 28-31; Report of the Security Council Committee established
pursuant to resolution 1267 (1999), 20 December 2002 UN Doc S/2002/1423
(2002) para 41. Back
44
As of 31 December 2005, no service entities were designated on
the UN Consolidated List solely on the basis of alleged links
with the Taliban. Back
45
Confidential interview with Al-Qaida/Taliban Committee member
on 4 March 2005, NY. Back
46
See, UN, Fourth report of the Al-Qaida/Taliban Analytical Support
and Sanctions Monitoring Team, UN Doc S/2006/154, para 59. Back
47
UN Consolidated List, p 30 (entry no 37). Back
48
lbid, p 28 (entry no 3). Back
49
Designation of 10 Terrorist Financiers Factsheet, US Treasury
Office of Public Affairs (Doc PO-3014) 19 April 2002. The Al-Rashid
Trust brought an action in Sindh High Court challenging the order
of the State Bank of Pakistan to apply financial sanctions against
it. (Report of Pakistan to the 1267 Committee on implementation
of United Nations Security Council resolution 1455 (2003), 17
April 2003, UN Doc S/AC.37/2003/(1455)/35 (2003) p 3.) The current
status of this case is unknown. Back
50
Escobar, P, "Anatomy of a `terrorist' NGO", Asia
Times Online, 26 October 2001 (available at http://atimes.com/c-asia/C126AgOl.html,
accessed 31 July 2005); UNHCR, Afghanistan Humanitarian Update
No 56, 5 March 2002 (available at http://www.unhcr.ch/cgi-bin/texis/vtx/afghan?page=news&id=3c84f2444,
accessed 19 September 2005). See also, Daniszewski, J and Watson,
P, "Age-Old Way of Moving Cash Leaves Little Trail",
Los Angeles Times, 26 September 2001; Whitaker, B and Pallister,
D, "First battle: a tangled web of terrorist cash",
The Guardian, 25 September 2001, (available at http://www.guardian.co.uk/international/story/0,,557703,00.
html). Back
51
BBC,"New Saudi body to oversee charity", BBC News
Online, 28 February 2004, (available at http://news.bbc.co.uk/1/hi/world/middle_east/3496734.stm,
accessed 31 July 2005). Back
52
"Saudis shut down charity", Aljazeera.net, 6 October
2004, available at http://english.aljazeera.net/NR/exeres/E358AE91-FAEC-407C-BDE9-31E8000BA37B.htm
(accessed 31 July 2005); Wechsler, W F and Wolosky, L S, Update
on the Global Campaign Against Terrorist Financing. Second Report
of an Independent Task Force on Terrorist Financing, Council on
Foreign Relations, 15 June 2004, p 5. Back
53
US, Additional Background Information on Charities Designated
Under Executive Order 13224: Al Haramain Islamic Foundation, US
Treasury Office of Terrorism and Financial Intelligence, at http://www.treas.gov/offices/enforcement/key-issues/protecting/charities_execorder_13224-a.shtml#ahif
(accessed 31 July 2005). Back
54
UN Consolidated List, 30 (entries nos 28, 29). See US, 11 March
2002. Back
55
UN Consolidated List, 29-30 (entries nos 19-27, 30-32). See,
UN Security Council press releases, UN Docs SC/7991 (2004), SC/8139
(2004), SC/8143 (2004), SC/8200 (2004); US, Treasury Announces
Joint Action with Saudi Arabia Against Four Branches of Al-Haramain
In The Fight Against Terrorist Financing, US Treasury Office of
Public Affairs, 22 January 2004 (JS-1108); US, Treasury Designates
Bosnian Charities Funneling Dollars to Al Qaida, US Treasury Office
of Public Affairs, 6 May 2004 JS-1527); US, Additional Al-Haramain
Branches Former Leader Designated by Treasury as Al Qaida Supporters.
Treasury Marks Latest Action in Joint Designation with Saudi Arabi,
US Treasury Office of Public Affairs, Washington, DC, 2 June 2004
JS-1703); US, US-Based Branch of Al Haramain Foundation Linked
to Terror. Treasury Designates US Branch and Director, US Treasury
Office of Public Affairs, 9 September 2004 JS-1895). See also,
BBC,"New Saudi body to oversee charity", BBC News Online,
28 February 2004 (available at http://news.bbc.co.uk/1/hi/world/middle_cast/3496734.stm,
accessed 31 July 2005) For a critical analysis of measures by
Saudi Arabia to combat the financing of terrorism, see Wechsler
and Wolosky (2004). Back
56
BBC,"New Saudi body to oversee charity", BBC News
Online, 28 February 2004 Back
57
"Saudis shut down charity", Aljazeera.net, 6
October 2004; Wechsler and Wolosky (2004) p 5. Back
58
UN Consolidated List, 32 (entry no 65); US, 19 November 2002. Back
59
See Benevolence International Foundation, Inc v Ashcroft, Case
No 02-C-763 (ND Ill, filed 30 January 2002); US v Benevolence
International Foundation, Inc & Enaam M Arnaout, 2002 US Dist
LEXIS 17223 (ND Ill 2002); US v Arnaout, 282 F Supp 2d 838 (ND
Ill 2003) Back
60
Arnaout, 282 F Supp 2d at 842. Back
61
Second Report of the Analytical Support and Sanctions Monitoring
Team appointed pursuant to resolution 1526 (2004) concerning Al-Qaida
and the Taliban and associated individuals and entities, UN Doc
S/2005/83 (2005) Annex 8-9. Back
62
Global Relief Foundation, Inc v P O'Neill, 315 F. 3d 748 at 750
(7th Cir 2002). Back
63
Treasury Statement Regarding the Designation of the Global Relief
Foundation, US Department of the Treasury Office of Public Affairs,
US, 18 October 2002 (PO-3553). Back
64
UN Consolidated List, 32-33 (entry no 70); UN Doc SC/7543 (2002). Back
65
Global Relief Foundation, Inc, 315 F 3d 748 at 750 (2002). Back
66
(JS, Additional Background Information on Charities Designated
Under Executive Order 13224: Global Relief Foundation, US Department
of the Treasury Office of Terrorism and Financial Intelligence,
at http://www. treas.gov/offices/enforcement/key -issues/protecting/charities_execorder_13224-e.shtml#g
(accessed 6 September 2005); Treasury Department Statement Regarding
the Designation of the Global Relief Foundation, US Department
of the Treasury Office of Public Affairs, US, 18 October 2002
(PO-3553). Back
67
Eggen, D and Lydersen, K, "In Michigan, Anti-Terrorism Effort
Goes Public: Haddad Case Forces Rare Glimpse of Secret US Campaign",
Washington Post, 6 May 2002, available at http://www.washingtonpost.com/act/wp-dyn?pagename=
article&node=&contentld=A37210-2002May5¬Found=true
(accessed 6 September 2005). Back
68
US, Former President of Global Relief Foundation Loses Immigration
Appeal and is Removed from the United States, US Immigration and
Customs Enforcement, Department of Homeland Security, 11 July
2003, available at http://www.ice.gov/graphics/news/newsreleases/articles/removal071503.htm
(accessed 6 September 2005). Back
69
See Global Relief Foundation, Inc v P O'Neill, 207 F Supp. 2d
779 (N D Ill. 2002); Global Relief Foundation, Inc, 315 F 3d 748
(2002). Back
70
For a full list of designated Al-Barakaat entities see UN Consolidated
List, 28-29, 31-32 (entry nos 6-16, 45-62). Back
71
BBC, "US shuts down Somalia internet", BBC News
Online, 23 November 2001, available at http://news.bbc.co.uk/1/hi/world/africa/1672220.stm
(accessed 14 September 2005); Barise, H, "Somali economy
hit", BBC World News, 27 August 2002, http://news.bbc.co.uk/1/hi/in_depth/world/2002/september_11_one_year_on/2219680.stm
(accessed 26 August 2003); BBC, "Somalia gets new telecoms
firm", BBC News Online, 30 April 2002, at http://news.bbc.co.uk/l/hi/business/1959540.stm
(accessed 14 September 2005). See also, Pallister, D, "Attack
on Afghanistan: Assets: Somalis count cost of hunt for terror
cash: FBI cuts off cash lifeline for community." The Guardian,
9 November 2001, p 6. Back
72
Although there is an increasing body of opinion that does question
the efficacy of targeted financial sanctions, see eg, Alvarez,
J, "The Security Council's War on Terrorism: Problems and
Policy Options" in E d Wet and A Nollkaemper (eds), Review
of the Security Council by Member States, (2003), pp 119-145,
at pp 144-145; Cuellar, M -F, "The Mismatch between State
Power and State Capacity in Transnational Law Enforcement"
(2003) Stanford Public Law and Legal Theory Working Paper Series,
Research Paper No 70; Gouvin, E, "Bringing Out the Big Guns:
The USA Patriot Act, Money Laundering, and the War on Terrorism"
(2003) 55 Baylor L Rev 955, at 975-981; Kiser, S, Financing Terror.
An Analysis and Simulation to Affect AI Qaeda's Financial Infrastructures,
PhD Thesis, Pardee RAND Graduate School (2004), pp 202-204. Back
73
See, Eland, I, "Economic Sanctions as Tools of Foreign Policy"
in D Cortright and G A Lopez (eds), Economic Sanctions: Panacea
or Peacebuilding in a Post-Cold War World?, (1995), pp 29-42,
at pp 32-34; Cortright and Lopez (2000) p 214. Back
74
The sanctions programme against the former Yugoslavia (Serbia
and Montenegro) provides a good example of this phenomenon. Cortright
and Lopez (2000) p 76. Back
75
See, Ghandour, A-R, Humanitarianism, Islam and the West. contest
or cooperation?, HPN, "Humanitarian Exchange", No 25,
December 2003 at 14, available at www.odihpn.org/report.asp?ID=2582
(accessed 11 August 2005). Back
76
Burrows, G, "Under suspicion", The Guardian,
28 November 2002, available at http://society.ggardian.co.uk (accessed
11 August 2005). This article also noted the concerns of some
Muslims that there is a concerted attack on the Islamic charitable
sector through the imposition of CFT measures and that "there
is a conspiracy to weaken Muslim civil society by whipping up
suspicion against Islamic charities". Back
77
See above, paragraph 39(b). Back
78
Confidential email correspondence with UN employee dated 13 March
2005. Back
79
UK, Charity Commission Statement of lnquiry: Benevolence International
(UK), Charity Commission of England and Wales, London, 16 June
2005, para 8. Back
80
Confidential interview with UN employee on 4th March 2005, NY. Back
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