Arbitration analysis: In Instrubel NV and Montana Management Inc v Montana Management Inc and others, the Court of Justice confirmed that a freezing measure adopted pursuant to an EU sanctions regulation does not in itself affect the ownership of assets subject to that measure, which remain the property of the sanctioned person. The question of the ownership of the assets of a sanctioned Iraqi entity which were frozen by France pursuant to Regulation (EC) No 1210/2003 was raised before the French Supreme Court in enforcement proceedings pending against the State of Iraq and various public entities of the Saddam Hussein regime. Against the background of the expansive sanctions imposed by the EU on Russian entities and individuals since 2014 and the ongoing discussion of Russian reparations for the war in Ukraine, this ruling serves as a timely reminder that the law as it currently stands does not allow for the confiscation of frozen Russian assets to compensate EU companies facing expropriation in Russia or to pay for the reconstruction of Ukraine.
KOROM, V. (2023). The Court of Justice confirms that assets frozen pursuant to EU sanctions regulations remain of their sanctioned owners (Instrubel NV and Montana Management Inc v Montana.Management Inc). LexisNexis.