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On 16 October 2025, the European Court of Human Rights delivered its judgment in the case of M.S.L. LLC v. Ukraine. The case concerned one of the first sanction packages introduced by a Presidential Decree back in 2015 under the recently enacted Law of Ukraine «On Sanctions». Citing threats to national security, the Ukrainian applicant company was subjected to economic sanctions for a one-year period, including the freezing of its assets – measures that were subsequently extended twice, until 2018. The company challenged these sanctions as unlawful and disproportionate.
The case attracted considerable attention, as it marked the first time the European Court of Human Rights provided guidance on judicial review of sanctions imposed under Ukraine’s national mechanism operated by the National Security and Defence Council (NSDC). It is noteworthy that this was Ukraine’s first experience in applying national sanctions to counter concealed, hybrid actions and threats that had emerged since 2014.
Spoiler: The European Court of Human Rights did not question the legality or legitimacy of the sanctions imposed by the National Security and Defence Council (NSDC). Instead, it focused on the procedural aspects of their implementation and judicial review before the national courts.
Scope of review
The European Court of Human Rights examined only one restrictive measure – the freezing of the applicant’s assets imposed by the first Presidential Decree of September 2015. Other sanctions contained in that Decree were not assessed, while the complaints concerning subsequent extensions of the sanctions in 2016 and 2017 were declared inadmissible due to the applicant’s own refusal to challenge them in national courts. In other words, the Court’s review was limited to a single episode from an earlier period, belonging to Ukraine’s initial sanctioning practice, rather than the current sanctions system in place.
Assessment of the national security context and the possibility of imposing sanctions on Ukrainian nationals.
The European Court of Human Rights acknowledged that the adoption of the Law of Ukraine «On Sanctions» (hereinafter – the Law) took place amid an unprecedented threat to the national security and territorial integrity of the State. This threat required a prompt response from the Ukrainian authorities, which could not be ensured solely through traditional criminal proceedings. Considering that the provisions of the Law were intended to cover various forms of conduct regarded as threatening to national security, the Court accepted that these provisions were drafted in broad terms, the interpretation and application of which are matters of practice (§§ 95-96).
This conclusion of the European Court of Human Rights indicates that the Law’s generally worded provisions permit practice-based, clarifying interpretation to address emerging forms of threats. In this vein, it can support the Supreme Court’s position that sanctions may be applied to Ukrainian nationals – provided such interpretation is grounded in the purpose of the Law and is accompanied by adequate procedural safeguards.
What did the Court find, and is any of it new for the judicial system?
The violation found by the European Court of Human Rights concerned the lack of individualized reasoning in the relevant Presidential Decree, which merely reproduced the statutory grounds in a generic manner (§ 98). The Court also found the scope of judicial review in the national proceedings to be unduly limited: the Supreme Court did not verify whether the Decree rested on a sufficient factual basis or whether the allegations against the applicant company were supported by proper evidence – specifically, proof that russians or russian companies were among the company’s ultimate beneficial owners (§§ 102-104). As a result, the Court concluded that the review carried out in this case did not afford the applicant a real opportunity to effectively challenge the measures (§§ 108-109). Importantly, the Court did not assess the proportionality or legitimacy of the sanctions themselves (§ 110), confining its analysis strictly to procedural aspects.
For Ukraine, these conclusions are not new. As early as 2020, in case No. 9901/259/19, the Cassation Administrative Court of the Supreme Court, granting the claim of Tolexis Enterprises AG to declare unlawful and void the 2019 Presidential Decree imposing personal economic sanctions on the claimant, held that sanctions must be based on real, objectively existing facts supported by evidence that reliably indicates conduct creating real or potential threats to Ukraine’s national interests and security, and that such evidence constitutes the grounds for inclusion in sanctions lists under the Law.
In another case, No. 990/176/23, by its judgment of 10 February 2025, the Supreme Court reaffirmed this legal position and further clarified the scope of the judiciary’s duties when reviewing the legality of sanctions. The Court emphasized that judicial oversight must extend beyond the formal grounds for issuing a Presidential Decree to also encompass the existence of a sufficient factual basis for the imposition of sanctions.
Thus, the position of the Supreme Court is generally consistent with that of the European Court of Human Rights: the imposition of sanctions must be based on verified and proven facts, and judicial review must be genuine rather than merely formal. The absence of proper reasoning in a Presidential Decree or of evidence supporting the factual grounds for sanctions constitutes sufficient basis for declaring such a decree unlawful and void, in line with the rule of law and the approach taken by the European Court of Human Rights.
Effectiveness of national legal remedies
Particular attention should be paid to §120 of the judgment, in which the Court emphasized that its finding of a violation of Article 13 of the Convention was of an individual nature, specific to this unique case, and did not cast doubt on the overall effectiveness of proceedings before the Supreme Court in similar matters. The Court acknowledged that, in the absence of excessive delays, the national mechanism of judicial review meets the standards of effective legal protection.
This conclusion is an important confirmation that Ukraine’s system of judicial review of sanction-related decisions complies with the effectiveness requirements, and that the deficiencies identified by the Court relate solely to the circumstances of this particular case.
Regarding compensation
Having examined the circumstances of the case, the European Court of Human Rights found no causal link between the alleged damage and the actions of Ukraine. In §134, the Court stated that the mere finding of a violation of the applicant’s rights guaranteed by the Convention constituted sufficient just satisfaction for any moral or other damage the applicant might have suffered. Accordingly, the Court did not award any compensation.
Conclusion
The judgment in M.S.L. v. Ukraine does not establish a universal precedent that would call into question the existing sanctions system or the mechanisms for its judicial oversight. It concerns a specific case and highlights key procedural requirements – individualized reasoning, substantive judicial review, and reasonable timeframes for consideration.
The European Court of Human Rights reaffirmed that sanctions, as an instrument of state policy, may remain a lawful means of responding to threats to national security.