CJEU lets Russia sanctions pierce trust structures

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May 25, 2026

A trust can move ownership out of sight. It cannot, the CJEU has now made clear, move it beyond the reach of EU sanctions. On May 21^st, the Court ruled in T Trust and a joint set of cases that assets placed in trusts may still be frozen where a sanctioned settlor or beneficiary retains real influence over them. The disputes came from Italy and concerned companies held through Bermuda trust structures, one involving a Swiss trustee, as well as the yacht “Sailing”. The claimants argued, in effect, that the legal form of the trusts meant the sanctioned persons could no longer dispose of or manage the assets. The Court was not persuaded.

The ruling matters because EU sanctions law is built to stop listed persons from using, controlling or benefiting from their wealth. Under Regulation 269/2014, funds and economic resources must be frozen when they belong to, are owned, held or controlled by sanctioned persons. The Court interpreted those terms practically. Control does not require a legal title. It may also exist where a sanctioned person has de facto power or influence over the assets. National authorities may therefore examine who benefits from the structure, how the trustee and beneficiary are connected and whether the arrangement looks unnecessarily complex or conveniently timed.

This is not an attack on trusts as such. Trusts are lawful instruments, and academic writers have warned that sanctions enforcement can sit awkwardly with traditional trust-law concepts. But the judgment tells trustees, banks and enforcement authorities to treat form as the beginning of the inquiry, not the end. It also fits a wider EU pattern as sanctions are moving from simple asset-freezing towards harder questions of ownership, control and circumvention. The message behind it is important. A trust may hide the paperwork. It will not necessarily hide the person still pulling the strings.

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