Caselaw Digest
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Eugene Shvidler v Secretary of State for Foreign, Commonwealth and Development Affairs

18 August 2023
[2023] EWHC 2121 (Admin)
High Court
The UK government sanctioned a wealthy businessman for his ties to Russia. He sued, saying the sanctions were unfair and discriminatory. The court sided with the government, saying the sanctions were necessary to pressure Russia to stop its war in Ukraine, even though they caused the businessman a lot of problems.

Key Facts

  • •Eugene Shvidler, a UK-US dual national, was designated under the Russia (Sanctions) (EU Exit) Regulations 2019 for allegedly being involved in obtaining a benefit from, or supporting, the Russian government.
  • •Shvidler challenges the designation on grounds of disproportionate interference with his ECHR rights (Articles 8 and A1P1) and discriminatory application of sanctions (Article 14, read with Articles 8 and A1P1).
  • •The designation was based on Shvidler's association with Roman Abramovich and his role as a non-executive director of Evraz plc, a company operating in sectors of strategic significance to the Russian government.
  • •Shvidler argues he has no direct link to the Russian government and that the sanctions have caused significant financial and personal hardship to him and his family.
  • •The Secretary of State argues the designation is proportionate, considering the importance of sanctions in deterring Russian aggression in Ukraine and the need to send a strong political message.
  • •The court considers whether the designation criteria were met, whether the measure was rationally connected to the objective, whether less intrusive measures existed, whether a fair balance was struck, and whether there was discrimination.

Legal Principles

Proportionality test for interference with Convention rights

Bank Mellat v HM Treasury (No 2) [2013] UKSC 39

Margin of appreciation for executive decisions in foreign policy

R (Lord Carlile of Berriew and others) v Secretary of State for the Home Department [2015] AC 945 (SC)

Sanctions and Anti-Money Laundering Act 2018 (SAMLA) provisions on sanctions regulations, designation criteria, ministerial review, and court review

SAMLA

Russia (Sanctions) (EU Exit) Regulations 2019 provisions on designation criteria and definition of 'involved person'

2019 Regulations

Strict scrutiny for discrimination based on race or ethnicity

Sejdić and Finci v. Bosnia and Herzegovina

Outcomes

Claim dismissed.

The court found that both bases for Shvidler's designation were established: his association with Abramovich and his role at Evraz. The court applied the proportionality test from Bank Mellat, accepting the importance of the objective but scrutinizing the connection between the measure and objective. It found a rational connection, considering the cumulative impact of the sanctions, the lack of less intrusive alternatives, and the balance struck between Shvidler's rights and the interests of the community. The discrimination claim was dismissed due to lack of evidence.

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