What rights (if any) can a person which(whose) assets are blocked as a result of sanctions exercise with respect to such assets? Can (s)he request a bank (where such assets are held) to issue an account statement documenting such funds? Can (s)he defend enforcement proceedings targeting such assets? It is unlikely that the EU blocking statutes have ever intended to prohibit the exercise of these rights with respect to blocked assets.
Indeed, an approach that no rights may be exercised with respect to blocked assets, is unlikely to be justified either as a matter of principle, or as a matter of black letter law. As a matter of principle, despite the broad interpretation approach to sanctions, such interpretation has its limits and could not cross the line of the non-confiscatory nature of blocking sanctions. As a matter of law, no blocking statute prohibits all actions or exercise of all rights with respect to frozen assets. What is prohibited is an action which may result in “any […] change that would enable the funds to be used”. Indeed, if the lawmaker intended to prohibit any action with frozen funds, it would have made this drastic restriction of ownership rights explicit in the statute.
When faced, however, with a similar question made in the context of blocked depositary receipts, a recently issued opinion of Advocate General de la Tour argued that the holder of blocked securities should neither be entitled to exercise any voting rights, nor even participate in the meetings where voting occurs. The approach was advocated on the grounds of “uniform”, “simple”, and “broad” application of sanctions laws.
Whilst these are certainly commendable values, if applied, they may run counter to the wording of the statute which prohibits only those actions with frozen funds which result in their change permitting use. It is also not clear how the principle that blocked securities shall not be treated as expropriated is consistent with a blank prohibition to vote such securities on any type of resolutions and even to attend the meetings where voting occurs and where, for example, the remaining shareholders can dilute the blocked securities or introduce other discriminatory amendments.
It is important to follow whether this approach is eventually supported by the ECJ and, if supported, whether it results in a new set of investment arbitrations claiming expropriation of assets. Another interesting side-effect of this interpretation will be the disapplication of “control” when it is found in corporate structures where blocked persons are major, but still minority, shareholders.