European Union Approves Global Magnitsky-Style Human Rights Sanctions Regime

Foley Hoag LLP - Global Business and Human Rights
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Foley Hoag LLP - Global Business and Human Rights

In a landmark development, the European Union’s Foreign Ministers on December 8 approved an “Action Plan on Human Rights and Democracy” that establishes a new mechanism for targeting systematic violators of human rights from any country in the world. The human rights community has colloquially termed the Action Plan “Europe’s Global Magnitsky Act”, an homage to the U.S. Global Magnitsky Human Rights Accountability Act that was passed by a wide bipartisan margin in Congress and signed into law by former President Obama at the end of his administration. Since passage of the U.S. Global Magnitsky Act, Estonia, Canada, Lithuania, Latvia, Gibraltar, Jersey, Kosovo, and the United Kingdom have also enacted so-called Magnitsky Laws.

The Action Plan provides several new authorities to E.U. states:

• Sanctioned nationals will be banned from traveling in Europe.

• The European Union can freeze the assets of both senior officials and entities such as organizations, companies, government agencies, or financial institutions.

• European banks, financial institutions, and other entities will not be allowed to make funds available to sanctioned entities and individuals who engaged in serious or gross human rights violations.

• Penalties could be applied in instances of genocide, crimes against humanity, state-sanctioned atrocities, extrajudicial killings, and arbitrary detention.

• Other violations could be punished if they are deemed to be “widespread, systematic or are otherwise of serious concern.”

The State Department has heralded the new E.U. Action plan, arguing that it will provide new authorities to U.S. allies that complement Washington’s ongoing efforts to sanction some of the world’s worst human rights abusers.

Critics have noted that while Magnitsky Laws allow any foreign national to be sanctioned by the countries in which the Laws apply, they have been constructed to provide significant discretion to the authorized sanctions body. In the United States, for example, the Global Magnitsky Act provided much needed power to the State Department’s Bureau of Democracy, Human Rights, and Labor (DRL) to directly engage with human rights defenders and compile the list of entities and individuals that should be sanctioned. However, the President and only the President makes the final determination regarding who, if anyone, on that list will be sanctioned.

In addition, civil society groups have pointed out that the U.S. Government has not sanctioned heads of state under the Act who are credibly confirmed to have committed gross human rights abuses, including Saudi Arabia’s Mohammed Bin Salman, Myanmar’s Aung San Suu Kyi, and China’s Xi Jinping or other senior leaders on the Standing Committee of the Chinese Central Political Bureau. These critics contend that such reticence alludes to a U.S foreign policy more committed to transactional and politically pragmatic relationships than human rights principles.

Nonetheless, the Trump Administration did use Global Magnitsky sanction to penalize a wide array of foreign nationals in dozens of countries, including close associates of Bin Salman, Chinese government entities and individuals responsible for internment and forced labor of minority communities in Xinjiang, Israeli billionaire Dan Gertle for mass corruption in the Democratic Republic of the Congo, and an entire Burmese military unit that raped, tortured, and killed Rohingya villagers. The Biden Administration is expected to more prominently position human rights within U.S. foreign policy, so this executive action will continue if not expand.

Like the U.S. Global Magnitsky Act, the E.U. Action Plan has limitations. Most importantly, the Action Plan’s new sanctions regime will only take effect after gaining unanimous approval from all 27 European Union member states. Obtaining unanimous consent may prove challenging now that some E.U. countries have embraced forms of nationalist populism that actively undermine human rights and rule of law in their own countries. And it remains to be seen if the European Union will support sanctions if those same measures could jeopardize a major contract, trade deal, or the broader policy objectives of certain member states.

Moreover, the new E.U. measures are not as extensive as the U.S. Global Magnitsky Act, which also applies sanctions for significant corruption. E.U. Foreign Ministers have said that they hope to expand on the Action Plan so that it includes corruption and other provisions in its ambit.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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