1. Introduction
On 7 October 2023, Hamas launched a coordinated terrorist attack that involved widespread killings, hostage-taking and systemic sexual violence against women, marking one of the most violent anti-Semitic events since the Shoah.Footnote 1 This attack led to various reactions by different stakeholders. Predominantly, it led to a military reaction by Israel which, in turn, is currently the subject of proceedings under international law due to the severe humanitarian suffering experienced by the people in the Gaza Strip.Footnote 2 The attacks also led to the introduction of various sanctions against Hamas: in January 2024, the United Kingdom (UK), the United States of America (US) and Australia imposed coordinated sanctions on Hamas in order to disrupt the terrorist group’s financial networks.Footnote 3 At the European Union (EU) level, ‘Restrictive Measures against Those Who Support, Facilitate, or Enable Violent Actions by Hamas and the Palestinian Islamic Jihad’ were introduced in January 2024, through Council Decision (CFSP) 2024/385 and Council Regulation (EU) 2024/386. These measures include travel bans and, importantly for this article, targeted asset freezes.Footnote 4
As early as July 2024, the United Nations (UN) Secretary-General António Guterres warned that ‘the humanitarian support system in Gaza is close to total collapse’Footnote 5 due to months of insufficient humanitarian aid crossing the border into Gaza. It became clear very early on that humanitarian aid had to be provided quickly and unimpeded in order to alleviate the suffering of the civilian population in the Gaza Strip.Footnote 6 In this situation, the nature of sanctions as potential double-edged swords comes into play: on the one hand, measures such as asset freezes serve the undeniably legitimate purpose of cutting off funding to terrorist groups like Hamas; on the other, these sanctions can severely worsen conditions for the civilian population,Footnote 7 which, in the case of Gaza, is already grappling with an internal refugee crisis and significant shortages of medical and nutritional care due to the conflict.
In recent years, both scholarship and civil society have increasingly highlighted the extensive negative consequences that such sanctions can impose on civilian populations.Footnote 8 Financial sanctions may intensify humanitarian suffering, primarily by generating chilling effects on humanitarian aid organisations and encouraging banks to implement de-risking strategies: this happens when fewer resources reach conflict-affected areas, as organisations and financial institutions hesitate to engage in the region for fear of inadvertently financing terrorism and facing sanctions, even when their activities are lawful.Footnote 9 Even with the shift towards so-called ‘targeted’ or ‘smart’ sanctions, which focus on individuals and entities linked to financing sanctioned groups, collateral damage to the general population cannot be fully prevented.Footnote 10 Such chilling effects can be seen in relation to Afghanistan after the Taliban’s 2021 takeover. Under US law, the Taliban is a Specially Designated Terrorist Group, making any transactions with them illegal,Footnote 11 creating significant legal uncertainty over whether the ban extends to all contact with the Taliban-led de facto government.Footnote 12 The US also froze around USD 7 billion of Afghanistan’s central bank reserves,Footnote 13 worsening the financial and humanitarian crisis.Footnote 14 In addition, the EU and the UK adopted different legal frameworks. This divergence has generated widespread uncertainty, disrupted services, scaled back operations and created funding gaps, including through de-risking practices by financial institutions, with cumulative adverse effects on civilians dependent on aid. The result is severe food insecurity, economic collapse and a deepening humanitarian crisis, with vulnerable populations suffering more than the sanctioned group.Footnote 15
The example illustrates how counter-terrorism sanctions cause effects that go beyond interfering with the human rights of listed individuals and organisations. Interconnected effects amount to a human rights cascade, where an action like imposing sanctions triggers a chain-like reaction: sanctions can inadvertently harm the human rights of uninvolved third parties. Such impacts are normatively significant in their own right. At the same time, they may also shape how those indirectly affected perceive the legitimacy of sanctions regimes. Social science research suggests that environments experienced as unjust can exacerbate radicalisation and increase susceptibility to extremist narratives.Footnote 16 Consequently, deteriorating living conditions, at both individual and collective levels, may foster solidarity with those targeted, potentially undermining the aims and effectiveness of sanctions in preventing terrorism. This article focuses on the human rights cascade effects that emerge from the interaction of sanctions, exemptions and measures to prevent evasion, and on their broader implications for international peace and security.
It examines these issues against the backdrop of complex and, in part, incoherent sanctions regimes. The risk that sanctions may worsen the overall humanitarian situation in areas where sanctioned individuals and groups operate has prompted a ‘major shift’Footnote 17 in the UN’s approach to combating terrorism financing, moving from a predominantly security-focused perspective to a more humanitarian one. The UN Security Council (UNSC) introduced humanitarian carve-outs through Resolution 2664 (2022), which specifically addresses critical humanitarian situations, such as those in Afghanistan.Footnote 18 Aimed at ensuring the ‘timely delivery of humanitarian assistance’,Footnote 19 it permits certain human rights actions and activities that support basic human needs, exempting them from being classified as violations of asset freezes.Footnote 20 The EU not only integrated these carve-outs into its UN-based sanctions regimes but also included nearly identical provisions in both wording and intent in its autonomous sanctions regimes, including those targeting Hamas—an evolution referred to as yet another ‘paradigm shift’.Footnote 21 One notable feature of the EU’s approach, which has largely gone unnoticed in academic and public discussions, is its inclusion of exemptions for dependent family members of sanctioned individuals, even before the UN carve-outs were introduced. This approach refocuses attention from the broader, unspecified population affected by counter-terrorism measures to individuals who are, on the one hand, in close proximity to sanctioned persons and potential terrorist activities but, on the other, particularly vulnerable to the cascading human rights consequences of such sanctions. Most, though not all,Footnote 22 of the EU’s sanctions regimes permit competent authorities in EU Member States to authorise the release of frozen funds or resources, or to make funds or economic resources available to or for the benefit of the listed persons, provided that the funds or resources are deemed necessary to cover the basic expenses of both the listed individuals and their dependent family members.Footnote 23 In this respect, the EU goes an essential step further than the UN by explicitly recognising family members as relevant third parties whose needs must be considered when designing counter-terrorist exemptions.
Building on a detailed analysis of human rights cascade effects, this article advocates the expansion of family exemptions across all counter-terrorism asset freezing regimes. Within the EU, such an extension is a necessity arising from the fundamental rights obligations that apply to counter-terrorism sanctions. To develop this argument, Section 2 examines humanitarian carve-outs at both the UN and EU levels as the relevant exemption mechanism designed to address the rights of third parties, in the sense of the general public. The analysis illustrates that these carve-outs are essential to fulfilling States’ obligations under international law toward indirectly affected individuals and illustrates how they operate by balancing the rights of third parties against the objectives of sanctions. Building on this analysis, Section 3 turns to family exemptions and contrasts them with humanitarian carve-outs. The article demonstrates how family exemptions similarly serve to protect third-party rights but differ in their functioning, as they rely on individual derogations and address third-party rights in a more individual sense. By clarifying which specific rights of family members are affected and exploring what constitutes interference in this context, the article contributes to the debate on the human rights implications of counter-terrorism asset freezing regimes and the broader methodology of EU fundamental rights. Section 4 concludes by proposing a harmonised, rights-based reform of sanctions regimes that extends beyond the EU level.
2. Bridging gaps in international law: the role of humanitarian carve-outs
This section examines details of the humanitarian carve-outs introduced in UNSC Resolution 2664 and subsequently incorporated by the EU into nearly all its sanctions regimes. The broad implementation of humanitarian carve-outs at the EU level (Section 2.1) demonstrates the EU’s strong commitment to aligning its sanctions with its broader international obligations, which should, by extension, apply to family exemptions as well. Carve-outs serve a purpose that extends beyond mere regulatory excemptions; they actively recognise and reinforce various international law obligations, including the protection of third-party human rights (Section 2.2). By addressing the risks associated with carve-outs (Section 2.3), the article examines how the balance between humanitarian considerations and security imperatives is maintained, thereby enabling a comparative analysis of the justificatory rationales of the regulatory frameworks for humanitarian carve-outs and family exemptions.
2.1. The global humanitarian shift at the UN level and the broad implementation approach of the EU
UNSC Resolution 2664 establishes a broad exemption mechanism for all existing and future UN financial sanctions regimes, not limited to counter-terrorism. It permits humanitarian organisations, UN agencies and related entities—including non-governmental organisations (NGOs) participating, for example, in the UN Humanitarian Response Plans or Refugee Response Plans—to provide, process or transfer funds, assets, goods and/or services necessary for the timely delivery of humanitarian assistance or to support other activities that meet basic human needs by the UN without violating the obligations of UN Member States to freeze the funds and other financial assets or economic resources of sanctioned individuals and groups.Footnote 24
The provision outlining Member States’ duties to freeze funds, financial assets or economic resources refers to two distinct and commonly present components of financial sanctions, collectively referred to under the umbrella term ‘asset freeze’:Footnote 25 freezing the assets of designated individuals and entities and prohibiting the provision of resources to or for them.Footnote 26 For simplicity, both will be referred to in this article as asset freezes or asset freezing measures. It must be noted, however, that the humanitarian carve-out primarily applies to the latter, i.e. the provision of funds to a listed entity. It is the more (if not the only) relevant variant in the context of aid delivery, as the objective is to ensure that charitable organisations are not inadvertently prevented from providing aid, even if some assistance may—in the case of counter-terrorism measures—unintentionally reach affiliates of designated terrorist groups.
The Resolution builds upon the single-regime-based carve-out concept present in UNSC Resolutions 1333 (2000),Footnote 27 1916 (2010),Footnote 28 2615 (2021)Footnote 29 and 2653 (2022),Footnote 30 expanding its scope and regulatory depth. It generalises the approach to apply to all current and future UN sanctions regimes, marking a significant step toward the systematic protection of vulnerable populations. The general concept of carve-outs is a step away from the previously prevailing method of exemptions for humanitarian purposes by derogation (i.e. compelling humanitarian organisations to request and obtain ad hoc authorisations from a specific sanctioning authority prior to engaging in any humanitarian activities),Footnote 31 which is for instance present, amongst other examples, in UNSC Resolution 1452 (2002), which introduced certain exceptions for the release of funds under the sanctions regime established by UNSC Resolution 1267 (1999) and overseen by the ISIL (Da’esh) and Al-Qaida Sanctions Committee (the ‘1267 Committee’). This shift broadly acknowledges that sanctions impact third-party rights and reflects a commitment to safeguard these rights, even within the framework of counter-terrorism. It also signifies a wider recognition of the need to protect civilian welfare in the context of sanctions regimes.
The EU has implemented a humanitarian carve-out within nearly all its targeted asset-freezing sanctions regimes. While most EU sanctions regimes contain this exemption, notable exceptions include those related to Belarus,Footnote 32 Russia,Footnote 33 TurkeyFootnote 34 and the misappropriation of State funds in Ukraine.Footnote 35 Apart from these exceptions, carve-outs have been consistently applied across the EU’s sanctions regimes,Footnote 36 whether they are autonomous sanctions, those derived from UNSC resolutions or mixed regimes with additional EU measures layered on top of UN sanctions. The EU’s sanctions system is complex,Footnote 37 comprising country-specific sanctions and horizontal, or thematic, regimes. Some are based on binding UNSC resolutions, others extend these measures (so-called ‘mixed regimes’), while some are entirely autonomous EU actions. Broadly speaking, EU sanctions relating to asset freezes are uniformly worded and encompass two distinct measures, identical to those in the UN regimes: the freezing of assets and the prohibition on making funds or economic resources available to designated individuals or entities.Footnote 38 The specific ‘targets’ of such measures—natural persons, legal entities, groups or organisations—are listed in a separate annex.Footnote 39 The decision regarding which persons, groups or entities are listed is made through an EU regulation and a Common Foreign and Security Policy (CFSP) decision. For EU-only regimes, this listing is based on an original decision by the Council of the European Union, whereas for UN-based regimes, the EU implements the listing decision of the relevant UN sanctions committee.Footnote 40
Humanitarian carve-outs have meanwhile become a key feature of almost all EU sanctions regimes, ensuring that sanctions do not unintentionally obstruct humanitarian aid: on 14 February 2023, the EU began implementing humanitarian exemptions based on UNSC Resolution 2664. As a first step, the EU fulfilled its obligationsFootnote 41 under the UN Charter by implementing the carve-out in the seven UN-based sanctions regimes.Footnote 42 Notably, on 31 March 2023, the exemption was extended to ‘mixed regimes’.Footnote 43 Although not required by the resolution to include the exemption in its autonomous sanctions, the EU did so to ensure a legally consistent framework, preventing a dual system where humanitarian actors would have to navigate two different sets of rules.Footnote 44 This step was pivotal in making humanitarian carve-outs standard in EU asset-freezing regimes. Since the further implementation of the carve-outs was not mandated by the UN Charter, the EU Council had to reach a consensus on applying them across various global sanctions regimes, each with differing risks and objectives.Footnote 45 Despite initial challenges, this effort was largely successful. While the sanctions regime for Syria includes only temporary carve-outs, which have so far been renewed,Footnote 46 and regimes for MoldovaFootnote 47 and IranFootnote 48 have more limited scopes regarding the humanitarian actors covered, there has nonetheless been a clear shift toward a broader implementation of humanitarian exemptions in line with UNSC Resolution 2664. By late 2023, the EU had introduced new autonomous regimes with ‘full-fledged’ carve-outsFootnote 49 and extended them to ten additional existing autonomous regimes.Footnote 50 On 19 February 2024, the Council further modified its restrictive measures on terrorism, introducing a 12-month humanitarian exemption to its asset freeze measures.Footnote 51 This exemption has since been extended until 22 February 2027.Footnote 52
The implementation within the autonomous regimes was further refined to reflect the fact that these sanctions operate as EU-autonomous measures rather than purely UN-based ones. Consequently, the Council expanded the list of exempted organisations to include: (1) ‘organisations and agencies to which the Union has granted the Humanitarian Partnership Certificate or which are certified or recognized by a Member State in accordance with national procedures’;Footnote 53 and (2) ‘Member States’ specialized agencies’.Footnote 54 While preserving the intent of the UN resolution, the EU therefore adapted the carve-out to align with its broader decision-making framework, effectively expanding the scope and enhancing the potential for delivering aid.
In summary, the EU’s comprehensive, targeted and systematic adaptation of the carve-out concept inspired by UNSC Resolution 2664 reflects a proactive approach, taken voluntarily, toward a more modern perspective on delivering humanitarian aid. This, too, signifies a broad and general acknowledgement by the EU of the critical importance of safeguarding third parties’ rights.
2.2. Previous protection gaps under international law
The step to introduce humanitarian carve-outs was important to clarify legal uncertainty regarding the scope of State obligations. Negative effects of sanctions such as asset freezes on third parties were already subject to evaluation under various branches and frameworks of international law, including international human rights law (IHRL), international criminal law (ICL) and international humanitarian law (IHL). However, these legal regimes lack the clarity and/or flexibility needed for effective humanitarian aid. Thus, carve-outs play a crucial role in addressing specific gaps that existing international law may not fully or clearly cover. Against this background, they are neither redundant nor merely symbolic,Footnote 55 despite the protections already established by international legal frameworks. Their significance at the UN level stems from the need for a consistent and adaptable application of sanctions globally. As will be demonstrated in this section, several arguments, when contextualised within the applicable international law norms, support this claim.
Although this has historically been contested, IHRL remains applicable and relevant alongside IHL, as confirmed by the International Court of Justice.Footnote 56 While various human rights may be affected by the absence of humanitarian aid, one of the primary humanitarian concerns in counter-terrorism efforts is ensuring access to food and medicine, both essential for maintaining the health of affected populations, as the situations in Gaza and Afghanistan vividly underline. The right to food and the right to health are widely recognised in various regional and IHRL instruments, including the right to an adequate standard of living and the right to the highest attainable standard of physical and mental health, as enshrined in Articles 11 and 12 of the International Covenant on Economic, Social and Cultural Rights (ICESCR).Footnote 57 However, referencing specific human rights instruments and guarantees presents a structural challenge, as not all UN Member States are equally bound by the relevant international legal norms. While scholars have suggested that core elements of the right to adequate food and the right to the highest attainable standard of health may have acquired the status of customary international law,Footnote 58 the precise scope and content of such customary recognition remain contested. In addition, even fewer States accept the competence of regional or UN bodies to comment on violations. The ICESCR, for instance, is not universally ratified, and even fewer States have ratified its Optional Protocol, which grants competence to the ICESCR Committee to receive and consider individual communications.Footnote 59 Even in the case of an acceptance of their competence, IHRL bodies on the universal level, such as UN Committees, Commissions and Councils, primarily play an advisory or monitoring role. Their influence is limited to measures such as promoting compliance and offering guidance. In contrast, carve-outs established through UNSC resolutions provide a universally binding framework.
Moreover, carve-outs serve a distinct purpose and offer protection in a different manner. While human rights, in their traditional interpretation, impose duties on States that primarily focus on prohibiting certain actions (duty to respect), they also include obligations for States to take positive actions (duty to protect, duty to fulfil).Footnote 60 However, the latter form of obligation is less common and typically does not specify the exact action a State must take—only that the State is required to act.Footnote 61 In contrast, humanitarian carve-outs specify State obligations. Additionally, human rights are conceptualised as rights of individuals,Footnote 62 protecting natural persons. Carve-outs, on the other hand, specifically permit third parties, namely humanitarian organisations, to provide aid to affected individuals. This makes carve-outs a unique legal instrument, distinct from general State obligations arising from human rights law, as they not only allow but also facilitate the involvement of external actors in humanitarian efforts.
As underlined by the UNSC’s ongoing references,Footnote 63 avoiding negative humanitarian side-effects is also a requirement of IHL. IHL establishes protective norms through key provisions in the Geneva Conventions and their Additional Protocols, which require the protection of civilians during armed conflict.Footnote 64 For example, Article 23 Fourth Geneva Convention requires the Contracting States to allow the free passage of medical supplies, food and other essential items for civilians of an adverse party. Article 55 mandates that an occupying power must ensure the supply of food and medical resources for the population in occupied territories. Article 69 Additional Protocol I expands this protection to include clothing, bedding, means of shelter and other supplies essential for the survival of the civilian population, as well as objects necessary for religious worship. Articles 59 to 61 Fourth Geneva Convention and Article 70 Additional Protocol I address relief actions, obliging the facilitation of aid when the population is inadequately supplied. Similarly, Article 81 Additional Protocol I requires States to provide humanitarian organisations, such as the International Committee of the Red Cross, with the necessary facilities to carry out humanitarian operations and facilitate their assistance to victims of conflict. These provisions emphasise the necessity of impartial humanitarian relief, requiring parties to ensure the rapid passage of aid.
However, these norms are more limited in scope and application compared to the flexibility provided by carve-outs. Despite significant protections, IHL’s application is primarily restricted to armed conflicts,Footnote 65 leaving peacetime and internal disturbances outside its scope. The range of IHL norms also varies depending on the type of conflict: international armed conflicts (IACs) are governed by the full spectrum of IHL, while non-international armed conflicts (NIACs) are subject to more limited treaty-based standards, although many core rules applicable in IACs are widely recognised as customary international law in NIACs, albeit with some exceptions and ongoing debate regarding their precise scope.Footnote 66 Specifically, Common Article 3 to the four Geneva Conventions applies to NIACs, establishing minimum requirements and permitting impartial humanitarian organisations to provide assistance. While Additional Protocol II extends further protections for victims in NIACs, its lack of universal ratificationFootnote 67 diminishes its overall effectiveness.
In the case of sanctions targeting groups like Hamas, the legal uncertainty surrounding the applicability and scope of IHL can lead to a real lack of aid, as chilling effects can hinder the provision of assistance. In particular, the debated status of Palestinian statehoodFootnote 68 is crucial to determining whether the IHL regime applicable is that of a NIAC or an IAC. Moreover, uncertainties regarding the existence of a NIAC and the application of IHL are exacerbated when terrorist groups are the belligerent parties in question, given the notable reluctance to recognise the applicability of Common Article 3 in such situations.Footnote 69 Similarly, many other sanctions regimes do not fit neatly into IAC or NIAC categories, further complicating the reliance on IHL protections. Many NGOs lack the legal expertise needed to navigate the complexities of international law, especially IHL, making the tailored provisions of UNSC Resolution 2664 more accessible and effective for humanitarian operations. While the Geneva Conventions and their Additional Protocols reference humanitarian actors, it would be inconsistent with IHL to grant NGOs the freedom to act independently, since humanitarian aid is ultimately subject to State approval.Footnote 70 Likewise, ICL is of little relevance to the humanitarian issue. While Article 8 of the Rome Statute criminalises war crimes, including the use of starvation as a method of warfare by deliberately depriving civilians of essential supplies such as food and medicine—underscoring the importance of humanitarian relief in conflict situations—its primary aim is to prosecute individuals responsible for such acts, rather than to create operational frameworks for NGOs.Footnote 71
This detailed analysis demonstrates that, while international law provides important protections, humanitarian carve-outs constitute a necessary and practical mechanism to address gaps not fully covered by IHL and other legal frameworks. Carve-outs enhance legal clarity by offering a more consistent and flexible approach to the delivery of humanitarian aid in the context of counter-terrorism sanctions. They help to overcome operational challenges and ensure that aid reaches those who need it most, thus ensuring both legal coherence and the effectiveness of humanitarian efforts.
2.3. Carve-outs and the risk of aid diversion
As illustrated in Section 2.2, the legal mechanism of the carve-out aligns with the overarching goal of fulfilling international law obligations. The approach employed in UNSC Resolution 2664 narrows the scope of sanctions by excluding certain actions or actors from the sanctions regime, rather than imposing prohibitions that require the approval of exemptions. This enables humanitarian organisations to provide aid without needing to navigate complex authorisation processes, significantly reducing bureaucratic delays and facilitating their work.Footnote 72 From a broader security policy perspective, a shift can be observed in how the risks and benefits of exceptions are balanced with the core objectives of counter-terrorism,Footnote 73 departing from the former derogation model. In this section, the balance established at the UN and EU levels will be briefly outlined. As the EU has adopted a similar approach to the UN, broader conclusions can be drawn about how security concerns are accommodated in relation to family members. To understand the balance struck, it is crucial to compare the objectives, the theoretical and practical risks and the effectiveness of carve-outs in achieving their intended goals. To achieve the goal of decreasing the suffering of innocent civilians,Footnote 74 humanitarian carve-outs narrow the scope of sanctions by excluding certain actions or actors from their scope, rather than framing these actions as exceptions subject to an approval process.
The increased freedom for aid-providing organisations granted by the carve-out model raises concerns about the heightened risk of resource misuse and aid diversion,Footnote 75 as humanitarian organisations often operate in areas controlled by sanctioned groups, making some interaction unavoidable. This fact was also recognised by the UNSC in Resolution 2664, when requesting that stakeholders relying on the carve-out:
use reasonable efforts to minimize the accrual of any benefits prohibited by sanctions, whether as a result of direct or indirect provision or diversion, to individuals or entities designated by this Council or any of its Committees, including by strengthening risk management and due diligence strategies and processes.Footnote 76
As the carve-out system places considerable trust in humanitarian actors, it is crucial to carefully vet the organisations receiving exemptions to avoid resource misuse by sanctioned groups. To mitigate the risks, the carve-out does not provide a blank check to all humanitarian organisations. Instead, it involves a pre-selection of organisations—primarily UN-based—essentially granting pre-approval or a ‘general’ derogation for their financial activities. Essentially, the carve-out represents what has been described as a ‘whitelist approach’.Footnote 77 Moreover, the carve-out is limited to asset freezing measures,Footnote 78 placing it somewhere between a regime-by-regime approachFootnote 79 and a more comprehensive, all-encompassing strategy.
However, this does not have a one-dimensional effect. Building on the concept of human rights cascade effects, which underpins the analysis, it becomes apparent that while limitations on the scope and duration of sanctions may strengthen security, they may also undermine the overall effectiveness of broader counter-terrorism objectives. The effectiveness of carve-outs can be constrained by this discretionary nature of the exceptions,Footnote 80 potentially exacerbating negative human rights cascade effects and, over time, contributing to radicalisation tendencies among individuals who are also affected by the sanctions. Concerns arise that the system may favour larger, Western-based organisations, potentially excluding smaller entities in regions affected by sanctions.Footnote 81 This could amplify existing criticism regarding the impact of sanctions on organisations focused on topics like gender equality and women’s rights, which often operate on a smaller scale.Footnote 82
In practice, the risk of misappropriation has not, as perhaps predicted by cautious UNSC members,Footnote 83 widely materialised, as humanitarian actors have shown resilience by implementing robust risk management mechanisms to address security concerns, thereby effectively advancing the goals of the resolutions: since the implementation of Resolution 2664, there have been no significant reports of aid being systematically divertedFootnote 84 to terrorist activities.Footnote 85 Instead, humanitarian actors have implemented their own measures to reduce the risk.Footnote 86 Moreover, although subject to some criticism, the mechanism established by the Resolution has largely demonstrated its success in fulfilling its intended goals,Footnote 87 having proven effective in mitigating de-risking and chilling effects.Footnote 88 As the implementation and refinement of these carve-outs evolve, maintaining this delicate balance between humanitarian assistance and counter-terrorism will remain a critical challenge—a challenge that is amplified when considering exemptions for family members.
3. Going beyond the UN carve-out regime: the EU approach towards family members
This section draws parallels with the earlier analysis of humanitarian carve-outs to demonstrate that family-member exemptions represent a crucial step toward acknowledging the distinct vulnerability of family members within the sanctions framework. At the same time, the current implementation of these exemptions appears inconsistent. While humanitarian carve-outs fulfil States’ obligations under international law, family exemptions within the EU legal framework play an equally important role in expressing and facilitating the enjoyment of family members’ fundamental rights under EU law. Just as humanitarian carve-outs serve a distinct purpose, as explained in Section 2.2, family exemptions likewise perform a unique and essential function in safeguarding fundamental rights.
Family members can be affected by sanctions in two main ways. First, they may be directly listed as targets.Footnote 89 Second, they may experience indirect impacts without being officially and directly sanctioned. This often occurs when a family member, usually financially dependent on the sanctioned individual, suffers financial hardship due to the listing. Sanctions lists across various regimes indicate that most listed individuals are male. In contexts where economic opportunities are unevenly distributed along gender lines, this may increase the likelihood that the sanctioned individual plays a central income-generating role within the household. The listing thus results in negative consequences for family members—such as wives, partners and children. This scenario raises various questions, some similar to those related to the direct listing of family members, including economic repercussions and social implications associated with being connected to a listed person. The analysis in this article, however, focuses exclusively on family members who are not directly listed, as those who are subject to direct designation have access to a broader range of legal remedies.
3.1. The EU approach towards family members: details and inconsistencies
As noted in Section 1, family exemptions are included in most—but not all—EU sanctions regimes, despite the absence of any legal grounds to justify this inconsistency. Notably, these exemptions are typically implemented through derogations, which are uniformly worded in accordance with the EU sanctions drafting guide established in 2005.Footnote 90 Their wordingFootnote 91 appears to have been adapted from an exemption introduced in UNSC Resolution 1452, which supplements the sanctions regime established by UNSC Resolution 1267 (1999).Footnote 92 However, the EU family exemptions introduce the phrase ‘dependent family member’, which was not part of the original UN wording. The addition to the text therefore appears to originate independently at the EU level. Yet, some EU sanctions regimes do not adopt this standard wording from the drafting guide.Footnote 93 In these instances, the phrase ‘dependent family members’ is omitted, as is the case in the original UN wording. While in theory the wording of this version of the derogation, even without explicitly mentioning family members in the sanctions text, could be interpreted as implicitly including the basic needs of dependent family members, this does not appear to be the favoured interpretation, as both academic literature and case law of the European Court of Justice (ECJ) discussing this derogation indicate that it is generally understood to cover only the basic needs of the listed person.Footnote 94
The absence of the reference to family members in some regimes seems primarily linked to the binding nature of UNSC resolutions. According to the sanctions drafting guide, EU sanctions must be aligned with UN resolutions where necessary.Footnote 95 This explains why the UNSC Resolution 1452 exemption, which does not reference family members, remains unchanged in its corresponding EU regulation. Curiously, however, additional measures against ISIL (Da’esh)/Al-Qaida, which are not directly based on UN acts, do include a family-member exemption.Footnote 96 Similarly, the sanctions related to the Beirut bombings, which also lack this specific exemption, are based on UN measures.Footnote 97 In an inquiry conducted with the Council of the EU, this line of reasoning concerning the EU’s obligations under the UN Charter was also presented.Footnote 98 The similar absence of derogations in the EU-based Zimbabwe regime date back to 2004, predating the inclusion of family-member exemptions in the drafting guide. Although the regime was updated in 2023 to include humanitarian exemptions,Footnote 99 the derogations have remained unchanged since their initial implementation.
While the EU correctly asserts that it has a duty to comply with UNSC resolutions, the conclusions drawn from this reasoning are flawed. Although the EU itself, as an independent international legal entity, is not directly bound by these resolutions, it is indirectly obligated to implement them because its Member States have conferred their responsibilities under Articles 25 and 103 UN Charter, which bind all EU Member States, on the EU. To fulfil this derivative obligation, the EU uses its competence to implement UNSC resolutions through Article 75 and Article 215 of the Treaty on the Functioning of the European Union (TFEU) and, occasionally, Article 352 TFEU.Footnote 100 However, this does not preclude the EU from introducing additional exemptions for family members. If the EU’s argument were applied consistently, it would imply that EU sanctions regimes should not include any exemptions when the corresponding UN resolution does not provide them. This approach would lead to unreasonable outcomes and is contradicted by the established practice of incorporating exemptions—including those for family members—into regulations that implement most other UN sanctions.Footnote 101 While one might argue for consistency across international frameworks to support an ‘international effet utile’, this does not preclude the EU from extending protections for individual rights. Moreover, from a formal perspective, UNSC resolutions provide only a skeleton framework that lacks detail and may be adapted by national or supranational legal systems with added specificity, potentially including further exemptions that do not undermine the overarching goal of the UN sanctions regime. This general idea was apparently also held by the European Court of Human Rights (ECtHR) regarding a UN-based travel ban, as the ECtHR stated in Nada v Switzerland that ‘Switzerland enjoyed some latitude … in implementing the relevant binding resolutions of the United Nations Security Council’.Footnote 102
Moreover, it has been questioned whether the binding nature of UNSC resolutions necessarily precludes the implementation of humanitarian exceptions in the absence of their explicit inclusion in the UN framework, with the argument that such an interpretation may not be supported by IHL.Footnote 103 As illustrated in Section 2.2, humanitarian exceptions are viewed as an expression of IHL, and the UNSC itself has emphasised the importance of adhering to IHL when enforcing sanctions, thereby enabling and obligating Member States to implement mechanisms for exceptions.Footnote 104 The same logic should apply to obligations under IHRL and EU fundamental rights, with the former being similarly and repeatedly referenced by the UNSC.Footnote 105 Given the strong framework of EU fundamental rights protections and its effective enforcement mechanisms, there is no obstacle preventing the EU from addressing the rights of family members. And, as affirmed by the ECJ in the Kadi judgment, the implementation of UNSC sanctions must balance international obligations with the protection of fundamental rights within the EU.Footnote 106 Similarly, the ECtHR has stated that there is ‘a presumption that the Security Council does not intend to impose an obligation on member states to breach fundamental rights’.Footnote 107 As will be explored in the following section, there are clear legal obligations that require the EU to ensure the protection of these rights.
3.2. Family exemptions in light of EU fundamental rights obligations: interference with multiple core rights
Just as humanitarian carve-outs at the UN level reflect and reinforce international law obligations for Member States, family exemptions within the EU similarly express their human rights obligations under EU law. As will be developed in this section, where family exemptions are not yet in place, EU fundamental rights create a duty for their introduction. While the UNSC has recognised the importance of humanitarian and human rights law in the implementation of sanctions, the claim that the binding nature of UNSC resolutions precludes further exemptions—even within the EU’s comprehensive human rights framework—raises critical questions as, unlike the UNSC, whose obligations under international law remain subject to ongoing debate,Footnote 108 the EU legislator operates within a more stringent, multitiered human rights system.
3.2.1. The ECJ’s oversight of fundamental rights in the context of sanctions
The EU human rights system guarantees access to justice for individuals whose fundamental rights are affected by the acts or measures of EU institutions, bodies, offices or agencies, as well as by Member States when implementing EU law. This reflects the strong protection of rights and the courts’ capacity to review UN sanctions listings,Footnote 109 while the Kadi cases illustrate the complex interactions that arise when UNSC resolutions are incorporated into EU law. In Kadi I, the ECJ rejected the Court of First Instance’s (CFI) narrower review in the Yusuf case,Footnote 110 which had only tested compatibility with jus cogens, and ruled that EU acts implementing UN sanctions must comply with EU fundamental rights.Footnote 111 The Kadi II decision by the CFI did not fundamentally alter this position, at least as long as there is no effective judicial review at the UN level,Footnote 112 with the creation of the Ombudsperson as well as the Focal Point mechanism potentially representing a first step towards establishing such an avenue of review.Footnote 113 As a result, the question of conformity with EU fundamental rights remains crucial, regardless of whether the sanctions are UN-based, ‘mixed regimes’ or EU-autonomous.
The existing case law of the ECJ related to listing has placed a strong emphasis on procedural rights (due process and the right to a fair hearing),Footnote 114 while substantive human rights have received comparatively less attention.Footnote 115 It has relied on broad and generalised justifications, as demonstrated in the early Bosphorus decision, with the primary rationale being the purpose of restrictive measures, particularly the preservation of international peace and security in the region.Footnote 116 Additionally, the Court rarely addresses the impact on third parties, as most relevant case law concerns listed persons challenging their inclusion.Footnote 117 It is evident, however, that third-party impacts resulting from sanctions are not uncommon. While it has been aptly noted that ‘[t]he sanctions systems have a profound effect on the human rights of those targeted but also on those who have relationships (personal or financial) with listed individuals and organisations’,Footnote 118 the following analysis focuses on substantive fundamental rights implications for family members.Footnote 119
3.2.2. Fundamental rights impacts on family members affected by asset freezing
The imposition of sanctions on listed individuals can impact several fundamental rights of their dependent family members, namely, the prohibition of inhuman or degrading treatment, the protection and care of children and the right to private and family life. It can constitute discrimination and, in certain circumstances, interference with their property rights. Identifying the scope of the rights of family members impacted by sanctions is complex and, to some extent, hypothetical, as it depends on the specific circumstances of each case. However, a realistic scenario assessed in the subsequent analysis is that family members, such as spouses or children, may experience financial hardship if they are economically dependent on a listed individual. Additionally, sanctions may result in significant social repercussions, such as difficulties in maintaining personal relationships or securing employment. In some cases, family members may face economic instability due to a lack of social benefits or legal barriers to employment.
Since, in the scenario addressed in this article, dependent family members are not themselves listed individuals and direct targets of counter-terrorism sanctions, an important doctrinal question has to be discussed in advance: EU sanctions without family exemptions do not directly interfere with dependent family members, as they neither explicitly prohibit any actions nor alter their legal status. However, to establish the burden of justification founded in fundamental rights, there must be an ‘interference’Footnote 120 or, in the words of Article 52(1) of the EU Charter of Fundamental Rights (CFR),Footnote 121 a ‘limitation on the exercise of the rights and freedoms recognized by this Charter’. When the rights-holder is the direct target of restrictive measures, such as a listed individual, the existence of an interference with fundamental rights is clearly evident.Footnote 122 For dependent family members, however, the question of interference is less obvious. While historically, interference was understood to be limited to direct, intentional and imperative actions by the StateFootnote 123—an understanding that would leave negative cascade-effects on family members outside the scope of fundamental rights control—this restrictive understanding is outdated in contemporary human rights doctrine. The reason is clear: States and supranational authorities could circumvent and significantly limit their obligations to uphold fundamental rights if these obligations were only applicable in cases involving imperative measures that directly and intentionally interfere with the legal positions of individuals under their authority.
Courts, including the ECJ, have adopted a broader concept of interference. The ECJ does not, in fact, employ an in-depth or systematic doctrinal approach to the question of indirect interferences with fundamental rights,Footnote 124 as seen, for example, in the more transparent doctrine of the German Federal Constitutional Court (FCC) (its approach to a wider (or ‘modern’) understanding of interference will be referenced later in this section). Nevertheless, it can be argued that the ECJ adopts a broader interpretation of interference,Footnote 125 a statement made in reference to a case that initially seems analogous to the issue at hand: in the ECJ’s Bosphorus case, more commonly known for the subsequent ECtHR decision on the relationship between the two courts, the ECJ addressed the seizure of a Yugoslav airplane leased to the Turkish airline ‘Bosphorus’. Although the sanctions targeted Yugoslav assets, the Turkish airline was also affected. The ECJ noted that:
Any measure imposing sanctions has, by definition, consequences which affect the right to property and the freedom to pursue a trade or business, thereby causing harm to persons who are in no way responsible for the situation which led to the adoption of the sanctions.Footnote 126
Although there are apparent parallels in the context of sanctions, the situation in the Bosphorus case differs to some extent from the issue of sanctions affecting family members. In Bosphorus, the entity subject to the seizure, though not the intended target of the sanction, was directly affected in a legal sense. By contrast, the rights of family members are implicated more indirectly, raising the question of whether the general sanctions regime (i.e. the regulation itself, which lists individuals in its annex) interferes with the rights of this type of third party. The ECJ’s broad interpretation of interference, as quoted above, suggests an understanding of what constitutes an interference that includes some types of negative effects on family members. To clarify the limits of this broad interpretation, it is helpful to establish a framework for determining when such effects genuinely constitute interference.
An approach to prevent an excessive expansion of the concept of interference is: first, to consider whether the specific right is intended to protect an individual who is not the addressee of the sanctioning measure in the given circumstances; and, second, to assess the extent to which the State or supranational measure significantly affects them.Footnote 127 The German FCC’s approach to this kind of ‘modern’ understanding of interference might be of particular interest in this context. The German FCC typically employs a two-step analysis, using, as a first step, the historic (or ‘classic’) and relatively strict concept of interference, as illustrated earlier in this section, which requires direct, intentional and regulatory State action.Footnote 128 In addition, if the criteria for the first step are not met, the Court considers, as a second step, whether the effect on the right(s) is ‘functionally equivalent’—i.e. comparable in its impact—such that the fact that the individual is not the primary target of the measure does not, in practice, alter the outcome. This standard of control is based on the assumption that:
[f]undamental rights protection is not limited to interferences that are directly addressed to the persons affected by them. Even state measures that have an indirect or de facto impact may be functionally equivalent, in terms of their objective and effects, to a direct interference with fundamental rights. Such measures must then be treated in the same way as a direct interference.Footnote 129
This second category can be classified as ‘indirect interference’.Footnote 130
When applied to the situation of dependent family members, the real-life impact of asset freezing is, in practice, similar to that experienced by the listed individual, particularly in cases where the family lives in a common household and/or shares economic and social ties. Translated into specific fundamental rights under EU law and the European Convention on Human Rights (ECHR), the following catalogue of rights may be subject to interference.
First, property rights (Article 17 CFR; Article 1 of Protocol No 1 to the ECHR) of individuals listed under sanctions are clearly impacted,Footnote 131 as sanctions freeze their assets, effectively restricting or eliminating their ability to use those assets. However, the situation for family members is more complex and largely depends on how the assets are shared or allocated. If joint assets are frozen—an action permissible under EU sanctions lawFootnote 132—the property rights of family members are impacted for the same reasons, even under the strict standard of direct interference. In situations where family members are financially dependent on the listed individual’s assets, the family member’s property rights are indirectly impacted, since they might be required to allocate any resources of their own differently (e.g. spending on groceries and rent) than they would have if the freeze had not been imposed.
Second, the right to respect for private and family life (Article 7 CFR, Article 8 ECHR)Footnote 133 is affected, a conclusion that can be drawn by considering European case law in conjunction with the principle enshrined in Article 33(1) CFR. In the context of sanctions, travel restrictions have been found to interfere with the right to respect for family life.Footnote 134 Also with regards to financial sanctions, the case law points in the direction of acknowledging interference with the right to family life. In Kadi II, the Court stated, in respect of the rights of listed individuals, that:
[n]otwithstanding their preventive nature, the restrictive measures at issue have, as regards those rights and freedoms, a substantial negative impact related, first, to the serious disruption of the working and family life of the person concerned due to the restrictions on the exercise of his right to property which stem from their general scope combined, as in this case, with the actual duration of their application, and, on the other, the public opprobrium and suspicion of that person which those measures provoke.Footnote 135
Similarly, in another case, the ECJ noted that sanctions ‘seriously disrupt both the working and the family life of the persons covered’.Footnote 136 While the ECJ, as indicated by the doctrinally rather untechnical term ‘disruption’, does not make a clear classification under the discussed categories of interference, at least an indirect interference can be assumed both for the listed individual and, as an autonomous interference, for dependent family members. While the right to family life does not primarily impose a positive obligation on the State to provide financial supportFootnote 137 as an expression of the ‘duty to protect’, asset freezing deliberately impacts the financial situation of a family and concerns, therefore, the negative duty not to interfere in ‘normal family life’Footnote 138 as an expression of the duty to respect. In the same vein, it has been argued that the financial isolation caused by sanctions exacerbates family conflicts and stress, thereby impacting the right to family life on both an economic and social level.Footnote 139 This argument is further supported by Article 33(1) CFR, derived from Article 16(1) of the European Social Charter (ESC), which guarantees the ‘legal, economic, and social protection’ of the family.Footnote 140 Unlike Articles 7 and 9 CFR (guaranteeing the right to marry and the right to found a family), it emphasises the economic and social aspects of family life. While it remains uncertain whether Article 33(1) CFR constitutes a right or a principle under the Charter,Footnote 141 with both interpretations finding support in the travaux préparatoires, text and structure of the Charter,Footnote 142 this question is not essential to support the argument. Even as a principle, Article 33 CFR must be observed—see Article 51(1) CFR—by the EU and Member States and remains relevant when interpreting EU law, even in the absence of the implementation (cf Article 52(5) CFR) of the principle, when its scope is affected.Footnote 143 Therefore, it can serve as a basis for interpreting EU acts and their compatability with the right to family life. Thus, Article 33(1) CFR, in conjunction with Article 7 CFR, underscores the economic and financial dimensions of family life that extend beyond property rights, dimensions that are affected in the context of sanctions. Similarly, economic isolation impacts the right to private life by preventing individuals from engaging in activities central to their personal identity, such as hobbies or social interactions.Footnote 144
As the ECtHR recognises, situations of social deprivation may fall within the scope of Article 3 ECHR,Footnote 145 which prohibits inhuman or degrading treatment or punishment. This right can, under certain circumstances, also be affected by the absence of family exemptions. Article 4 CFR contains a prohibition of torture and inhuman or degrading treatment or punishment which corresponds to Article 3 ECHR; thus, its meaning and scope shall be the same as those laid down by the ECHR (Article 52(3) CFR). Although the ECtHR initially did not consider social need as a ground for State obligations,Footnote 146 its case law has since evolved. For instance, in cases involving vulnerable groups like children, the Court has held that States have positive obligations to provide basic necessities in cases of severe hardship.Footnote 147 However, the Court has been more cautious in extending such obligations to adults in general, often requiring evidence of specific suffering and examining whether individuals worsened their situation by refusing State aid.Footnote 148 In the context of sanctions, where the listing results in economic hardship, the focus, again, shifts from positive to negative obligations. Thus, the argument regarding ‘group vulnerability’Footnote 149 is less relevant, as the EU sanction itself creates this specific vulnerability of individuals and their families through its targeted measures. The failure to provide welfare support is not at stake.
The special need for protection of children in the context of sanctions must also be considered in light of Article 24 CFR, granting children ‘the right to such protection and care as is necessary for their well-being’. Like the rationale behind the prohibition of inhuman or degrading treatment or punishment, the specific needs of children are particularly at risk when the primary income provider in the family is listed under sanctions, thereby affecting the scope of this right. This interpretation is confirmed by Article 2(2) of the UN Convention on the Rights of the Child (CRC),Footnote 150 that requires States Parties to take appropriate measures to ensure that children are not subjected to discrimination or punishment due to the status, activities, opinions or beliefs of their parents, legal guardians or family members. The CRC has been ratified by all EU Member States.Footnote 151 Asset freezes resulting from the terrorism-related actions or failures of a child’s parents can significantly affect the child’s social and financial well-being and may have a significant impact on a child’s prospects. Given the severity of these potential consequences, they can be viewed as a form of punishment within the meaning of Article 2 CRC and the broader context of the Convention’s non-discrimination principle, without deciding whether they amount to criminal punishment.
The absence of a family exemption could also be viewed as a form of discrimination, which is prohibited by Article 21(1) CFR, which states that ‘[a]ny discrimination based on any ground such as sex, race, colour, ethnic or social origin, genetic features, language, religion or belief, political or any other opinion, membership of a national minority, property, birth, disability, age or sexual orientation shall be prohibited’. While sanctions do not constitute direct discrimination based on one of the protected characteristics listed in Article 21(1) CFR, the lack of such exemptions disproportionately affects Muslims, women and children, leading to potential indirect discrimination based on gender, age or religion (or a combination thereof). In fact, it is theorised that financial counter-terrorism measures may disproportionately affect women.Footnote 152 At the same time, caution must be taken not to adopt an overly gendered, male-focused view of terrorism, as women are not only victims, as often portrayed, but also perpetrators of terrorism.Footnote 153 Additionally, although this type of discrimination has not yet been recognised in the case law of the ECJ or ECtHR, it could also be seen as intersectional discrimination, particularly against Muslim women and children. Intersectional discrimination ‘recognises that different identity categories can intersect and co-exist in the same individual in a way which creates a qualitatively different experience when compared to any of the individual characteristics involved’.Footnote 154 This form of intersectional discrimination particularly affects minor children of listed individuals who, due to their age and religious affiliation, may suffer significantly more frequent and intense human rights cascading effects as a result of counter-terrorism measures, compared to the rest of society.
3.3. Regulatory choice in light of proportionality requirements: derogations and individual application procedures for family exemptions
As outlined in Section 3.2, asset freezing regimes cause diverse (indirect) interferences with the fundamental rights of dependent family members, which can be justified only if they meet certain requirements: that is, if they are provided for by law, respect the essence of the rights concerned and, subject to the principle of proportionality, are necessary to achieve objectives of general interest recognised by the EU or to protect the rights and freedoms of others (Article 52(1) CFR).Footnote 155
The substantial restrictions imposed by asset freezing measures on dependent family members, particularly the curtailment of previously advantageous housing and living conditions, can, in principle, pursue a legitimate aim by virtue of the close social, economic or familial relationship with the listed individual, namely, the disruption of funding for terrorist groups. In this sense, the limitation on their living conditions contributes to the overarching goal of combating terrorism. It is worth taking a closer look at the details of potential legitimate aims pursued by directly or indirectly interfering with the fundamental rights of dependent family members. Various objectives are discussed in the literature dealing with the direct listing of family members as sanctions targets. These include preventing sanctions evasion,Footnote 156 denying the benefits of wrongdoing to the primary target, punishing the targeted individual and influencing their behaviour.Footnote 157 The EU Council has highlighted the particular risk of circumvention of sanctions and argued that the direct listing of family members of Russian businesspersons was necessary in light of the fact that:
leading Russian businesspersons have engaged in a systematic practice of distributing their funds and assets amongst their immediate family members and other persons, often in order to hide their assets, to circumvent the restrictive measures and to maintain control over the resources available to them. Therefore, the Council considers that immediate family members or other natural persons, who benefit in such a way from leading businesspersons operating in Russia, should also be designated as appropriate, in order to both increase pressure on the Government of the Russian Federation to bring an end to its war of aggression against Ukraine as well as to avoid the risk of circumvention of the restrictive measures.Footnote 158
If compared with the direct listing of family members, the indirect impact on the fundamental rights of dependent family members discussed in this article represents a lesser degree of interference. Nonetheless, from an a maiore ad minus perspective, the transferability of the objectives as discussed in literature and highlighted by the Council can still be considered. From a comparative perspective, the majority of objectives discussed in the literature for affected family members through sanctions are, from a rule-of-law standpoint, unsuitable, which makes the goal of preventing circumvention particularly relevant.
The concept of punishment is an inherently problematic concept when applied to individuals who have no direct involvement in the actions that prompted the sanctions.Footnote 159 Moreover, punishment is not the principal aim of targeted asset freezes with respect to the primary target;Footnote 160 accordingly, the provisions do not aim to punish third parties. Even if the overall aim were to punish the listed individual—which in itself raises concerns regarding that person’s procedural and substantive rights—the indirect penalisation of dependent family members cannot be regarded as a legitimate aim of the measure. The mere existence of a connection—whether through legal relationships like marriage or through biological or social bonds such as parenthood or familial ties—without concrete evidence of actual support for terrorist activities fundamentally contradicts the broader principles of the rule of law,Footnote 161 regardless of whether this meets the legal threshold for criminal punishment. Although these measures often persist for extended periods and may be viewed as (de facto) punitive, their intended purpose is to remain temporary and preventive rather than repressive and punitive.Footnote 162
Similarly, while the behaviour of the primary target may be influenced by the negative effects of the sanctions on their family, this approach conflicts with the rule of law for similar reasons, resembling coercive tactics rather than a lawful response.Footnote 163 Denying the benefits of wrongdoing to the primary target is inconsistent with the fundamental purpose of asset freezes, which are primarily preventive measures designed to maintain security rather than to attribute guilt. The procedural safeguards required to deprive someone of presumed benefits from an association with a terrorist organisation are beyond the scope and aim of the sanction process. In other words, these measures are not about confiscating the ‘fruits of terrorism’, but about addressing security concerns. This may, however, be viewed differently in other contexts. In anti-corruption sanctions or measures targeting wealthy individuals, such as oligarchs, for example, the goal of denying the benefits of wrongdoing may play a more direct role—at least from a societal or political perspective.
Thus, among the potential objectives, only the prevention of sanctions evasion can be regarded as an ‘objective of general interest recognised by the Union’ within the meaning of Article 52(1) CFR that fulfils the requirements of the rule of law. Interferences with fundamental rights, however, satisfy proportionality requirements only if the measure causing them, namely the applicable sanctions regime, constitutes the ‘least restrictive means’,Footnote 164 meaning that the human rights cascading effects are as minimal and non-intensive as possible. In this regard, the protection of dependent family members from the indirect effects of asset-freezing measures requires that the applicable sanctions regime provide a procedural mechanism enabling them to obtain the release of funds or economic resources necessary to cover their basic needs.
In terms of the regulatory choice of an appropriate procedure, the close personal ties between dependent family members and the listed individual fundamentally distinguish their situation from the broader protection of the general public pursued through humanitarian carve-outs. When assessing the specific risks of misappropriation, it is essential to focus specifically on the risks associated with family members, which is closely tied to the question of the appropriate and proportional regulatory approach to achieve this legitimate goal. While the potential for misappropriation in humanitarian carve-outs is frequently raised, it has not materialised significantly.Footnote 165 However, the close personal ties between family members and sanctioned individuals alter the dynamics and may increase the risk of misappropriation of funds for terrorist purposes, due to the emotional, social and legal dependencies between the sanctioned person and their dependent family members. One way to formalise this distinction between the types of risks is through the concept of proximity, recently expanded by Datzer, Walde and Lonardo, who adapted an existing framework from country sanctions to the context of terrorism sanctions.Footnote 166
Applying this generalised proximity model to EU financial sanctions in order to assess the situation of family members provides valuable insights. The proximity model distinguishes between varying levels of connection to terrorist acts, justifying stronger sanctions the closer the individual’s connection. The model has three layers: the closest layer includes direct perpetrators; the intermediate layer involves those providing financial or material support without direct participation; and the most distant layer, relevant here, covers family members with no active involvement in terrorist activities.Footnote 167
When comparing family members to individuals in humanitarian need, it is evident that family members are closer to the sanctioned individuals than neutral third parties, such as the general population, which clearly falls outside the scope of the proximity model. Although the connection between family members—who are not personally targeted by security authorities due to their own actions—and the terrorist actions are admittedly more distant, it nonetheless justifies a somewhat heightened level of scrutiny by security authorities. This remains true even when considering that the smaller amounts of money required to meet basic needs may not present a greater security risk than the larger sums typically involved in humanitarian aid. This conclusion is based on the following factors: humanitarian carve-out systems, which typically rely on white-listing specific humanitarian actors, are not adequate for the release of frozen assets to dependent family members of listed individuals. The closer personal and financial proximity of family members to the sanctioned individual significantly increases the risk of misuse of released assets. This heightened risk means that any release of funds for dependent family members requires a thorough, case-by-case assessment by the competent authorities to verify the plausibility of the claimed need and, where necessary, implement safeguards to prevent misuse. While the white-listing approach within humanitarian carve-outs includes safeguards aimed at preventing misappropriation, these mechanisms are insufficient in the context of close familial relationships. From a regulatory and proportionality perspective, a derogation model that provides an independent, individualised application procedure is therefore the appropriate mechanism. It ensures that the rights of dependent family members are respected, that the collateral impact of sanctions is mitigated and that the release of funds is tailored to individual circumstances, thereby balancing fundamental rights with security objectives and addressing practical concerns, such as potential tensions or conflicts within the family arising from the listing. Furthermore, under the white-list system, the identity of the aid-providing actor is already known, whereas with family members, such information is not pre-established. Additionally, the aims of humanitarian actors are clearly defined—they are focused on providing aid—while family members must first prove their dependency and the necessity of provision for their basic needs.
Against this background, the regulatory approach adopted by the EU—which mitigates the human rights cascading effects of asset freezes on dependent family members through case-by-case derogations rather than a generalised carve-out—is preferable. Nevertheless, two aspects require further improvement. First, since asset freeze measures can significantly affect the fundamental rights of financially dependent family members, this makes the introduction of family exemptions a fundamental rights imperative and calls for harmonisation of this approach across all relevant EU sanctions regimes.Footnote 168
Second, because asset-freezing measures create an autonomous—albeit indirect—interference with the fundamental rights of dependent family members, distinct from the rights of the listed person, there is clear justification for granting them an independent right to apply for the release of essential funds (e.g. for food, rent or mortgage, medicines and medical treatment, taxes, insurance premiums and utility charges) and to initiate, thereby, the review procedure. A review of EU and Member State practice reveals no clear evidence as to whether dependent family members may independently, that is, without the cooperation of the listed person, request the unfreezing of funds necessary to cover essential expenses. While this procedural uncertainty may appear marginal, given the typically close personal and economic ties between dependent family members and the listed individual, it becomes particularly problematic in situations where dependent relatives cannot rely on the listed person’s cooperation. In such cases, the absence of a clearly defined procedural entitlement effectively deprives them of access to essential resources and exposes a broader structural ambiguity within the current sanctions framework regarding the procedural standing and fundamental rights protection of indirectly affected persons. De lege lata, dependent family members are not legally unprotected, since the EU legal order recognises the family link as relevant with regards to authorising the release of frozen funds or resources, provided that the funds or resources are deemed necessary to cover the basic expenses of both the listed individuals and their dependent family members. However, it appears that they remain procedurally dependent on the cooperation of the listed person to access essential funds.
Granting an individual right to apply for the release of funds functions as a rule-of-law safeguard, mitigating and proportionately balancing the collateral impact of listings. It recognises the existence of an autonomous legal interest and ensures that proportionality is assessed in light of each person’s specific circumstances. Beyond its normative function, such a mechanism also has practical value: where sanctions have generated tensions or conflicts within families, an independent application procedure allows family members to distance themselves from the acts or beliefs of the listed person, thereby supporting broader policy objectives such as deradicalisation. Because these assets are not owned by the family members but are frozen funds of the listed person, a high level of plausibility is required, as granting a family member access to the listed person’s assets effectively constitutes a form of enforcement of child or spousal obligations. Therefore, if the listed person consents, applicants must provide evidence that they are obligated to provide support and that the family members are therefore dependent. If such consent does not exist, applicants must present an enforceable judgment confirming the obligation of the listed person to provide support. These two evidentiary pathways reflect a realistic and proportionate balance between the prevention of circumvention and the protection of fundamental rights.
4. Conclusion
This article investigates how counter-terrorism sanctions, particularly asset freezes, affect third parties, conceptualising these effects as a human rights cascade. In this regard, cascade refers to the phenomenon whereby the imposition of sanctions triggers a chain reaction that inadvertently affects the human rights of uninvolved third parties—individuals who themselves have not engaged in any conduct that would place them within the focus of security authorities.
The article adopts a comparative perspective, focusing on two groups: the general population affected by sanctions and the dependent family members of sanctioned individuals. While sanctions are designed to prevent financial support for prohibited terrorist activities, they can impact the broader population, exacerbating humanitarian crises, as seen, for example, in Afghanistan. Dependent family members, however, experience a distinct yet (if compared with listed individuals) indirect form of interference with their fundamental rights, as their access to essential resources is constrained by the frozen assets of the sanctioned individual. Although these family members are not the direct addressees of the restrictive measures, the functional equivalence of the effects means that, in practice, they suffer consequences comparable to a direct interference with their fundamental rights. Counter-terrorism asset freezing can significantly affect, among other fundamental rights, the right to respect for private and family life, since economic constraints disrupt normal household functioning, generate tensions and limit participation in social and personal activities. Children are particularly vulnerable, as the absence of accessible resources can impair their well-being, education and prospects. Moreover, the disproportionate indirect impacts on women, children and religious minorities may amount to indirect or intersectional discrimination, reinforcing existing social inequalities and exacerbating the cascading human rights effects of sanctions. While the argument focuses on counter-terrorism sanctions—where it carries its greatest weight due to potential effects on international peace described in Section 1—it remains relevant for other regimes as well.
To mitigate the humanitarian impacts of sanctions, the UN has introduced humanitarian carve-outs, designed to ensure that aid can reach the general population through entities such as humanitarian organisations with UN General Assembly observer status, or NGOs funded bilaterally or multilaterally that participate in UN Humanitarian Response Plans, without undermining overarching security objectives. These carve-outs, however, do not specifically address the situation of dependent family members of listed individuals.
The EU has gone further by introducing family-member exemptions, allowing sanctioned individuals to access funds for essential living expenses for themselves and their dependent relatives. This EU-specific mechanism recognises the unique hardships faced by family members who are economically dependent on the listed person. Nevertheless, despite this advancement, the approach is not without shortcomings. Indirect interferences with the fundamental rights of dependent family members can only be justified if they meet the requirements of proportionality in pursuit of an objective of general interest. Among the potential aims discussed in doctrine and policy, only the prevention of sanctions evasion constitutes a legitimate and rule-of-law–compliant justification. Other purported aims, such as punishment, behavioural influence or denial of benefits to the primary target, are inconsistent with the preventive nature of asset freezes and incompatible with the principles of individual responsibility and proportionality.
In this light, the EU’s current regulatory approach, which addresses the negative impacts on dependent family members through individual derogations rather than a generalised carve-out, represents—a priori—a proportionate and security-sensitive mechanism. Nonetheless, its fragmented implementation across EU sanctions regimes and the procedural dependency of family members on the cooperation of the listed person expose significant shortcomings. Moreover, the fragmentation between the EU’s implementation of UN sanctions—even where harmonised—and their implementation in other countries may give rise to inequalities. The UN could draw on the EU approach to make family exemptions genuinely universal by incorporating them into its own sanctions regimes.
The main argument of this article, grounded in the EU’s fundamental rights obligations, may also carry weight at the global level in relation to international human rights obligations, although these are neither as stringently monitored nor as comprehensively codified. A fully harmonised system of family exemptions, combined with an autonomous procedural right for dependent family members to request the release of essential funds (e.g. for food, housing, medical care, taxes, insurance premiums and utilities), would strengthen both the coherence and the respect for fundamental rights within the EU sanctions framework, while also offering a model relevant to UN sanctions regimes.
Beyond its normative value as a rule-of-law safeguard, such a mechanism also holds significant practical and preventative potential. Where sanctions have created financial strain, tension or alienation within families, an independent application procedure empowers family members to distance themselves from the acts, ideologies or affiliations of the listed person. By facilitating this dissociation, the mechanism not only reduces the human rights cascade effects but also contributes to broader policy goals such as social reintegration and deradicalisation, ensuring that restrictive measures remain both effective and justifiable within a rights-based legal order.
Acknowledgments
This article is based on the research project ‘Human Rights and Cascading Effects of Countering Islamist Terrorism’, led by Patricia Wiater and funded by the German Federal Ministry of Education and Research (BMBF) under Grant No 01UG2028A. This article summarises selected results from the research project. For the helpful preliminary research on the topic, Patricia Wiater thanks Tina Brosi, who participated in the project as a research assistant.
