, a Saudi resident with assets in Sweden, and Al Barakaat, a charity for Somali refugees, claimed that his assets being frozen was unlawful. Their property was seized without any court hearing or right of redress or allegation of wrongdoing. The UN Security Council adopted resolutions under Chapter VII to freeze assets of people and groups associated with the Taliban and Osama Bin Laden. The EU adopted Regulations to give effect. Sweden had given effect to the Regulation. The claimants were named in the Resolution and Regulation. They claimed the Regulation should be annulled under TFEU article 263 and it was a breach of human rights.
In the Opinion of Advocate General Maduro, EU law did not need to unconditionally bow to international law, if the consequence could be a violation of basic constitutional principles.
The General Court held that the Regulation was valid. Although agreements with a non-member state ordinarily prevails, it cannot prevail over provisions forming a core part of the constitutional foundations of the EU system. 233–259, Security Council resolution was binding on all UN members and prevailed over all treaties. It had to be carried out even if it conflicted with the EU Treaties. EU MSs were parties to the UN Charter before the EU Treaties, so TFEU art 351 required fulfilment of those obligations. This meant the Resolution prevailed over EU law. The EU was not bound under international law, but it was bound in EU law, following from International Fruit Company Case 21-4/72, ECHR 1219. There was, also, no infringement of a jus cogens norm by the Resolution.
The Court of Justice held the resolution was invalid in EU law. The court had no jurisdiction to review the legality of Security Council Resolutions, but it could review EU regulations. The regulation was adopted to give effect to Member State obligations. Although under international law Security Council Resolutions prevail, under EU law the hierarchy of norms differs. It rejected that TFEU art 351 protected the Regulation from challenge. The Regulation was annulled in relation to Kadi, but effect maintained for a limited period.
Significance
The CJEU judgment reflected a choice between absolute acceptance of international law and the preference for its own constitutional requirements on the assumption that international law may still be in a state of development: a view widely held in the aftermath of the War on Terror and the 2003 invasion of Iraq. This contrasted to the US Supreme Court rule from Murray v The Schooner Charming Betsy, that an act of Congress ought never to be construed to violate the law of nations if other possible constructions are available or it was "fairly possible" to avoid conflicts.
