A freeze on all assets pending trial can be proportionate

The First Hall of the Civil Court (Constitutional Jurisdiction) on 3 March 2026 rejected a challenge to a freezing order made in money laundering proceedings. Madam Justice Joanne Vella Cuschieri held that the order, which at first caught every asset of the accused and two companies, breached neither the right to a fair hearing nor the right to property. The case is S.F. vs Avukat Tal-Istat, brought against the State Advocate, the Attorney General and the Commissioner of Police.

The facts

On 12 April 2021 the applicant and two companies appeared before the Court of Magistrates (Malta) as a court of criminal inquiry, charged with money laundering and other offences. The court granted the prosecution's request for a freezing order under article 5 of the Prevention of Money Laundering Act (Chapter 373 of the Laws of Malta), article 23A of the Criminal Code (Chapter 9 of the Laws of Malta) and article 36 of the Proceeds of Crime Act (Chapter 621 of the Laws of Malta).

The order froze all their assets and allowed the applicant €13,976.24 a year to live on. She filed many applications in the criminal courts to revoke or vary it. Several succeeded, including requests to recover her car and personal belongings and to pay creditors. Those seeking full revocation, or more money than the law allowed, failed.

After Act VI of 2024 amended the law, the court raised her allowance to €21,945 a year. On 28 January 2025 the Court of Magistrates limited the order to shares, sums and company assets listed by the prosecution. The Criminal Court refused to revoke it on 6 March 2025.

The applicants argued that, before the amendment, the law gave them no way to limit the freeze to the alleged proceeds. They claimed breaches of article 6 of the European Convention on Human Rights, article 39 of the Constitution, article 13 of the Convention, article 1 of its First Protocol and article 37 of the Constitution, and sought damages.

What the court held

The court rejected three preliminary pleas. The Attorney General was a proper defendant because the Attorney General sought the order and answered every application about it. The Commissioner of Police was one too, because the complaints ran from the arrest onwards. The claim was not premature, because it concerned a closed period before the law changed.

On the fair hearing claim, the court found that remedies existed and worked. Article 5(3) of Chapter 373 and article 36(4) of Chapter 621 let the court vary an order, and the criminal courts did so where the applicants were right. The law never provided for the full revocation they kept seeking. For the same reasons the court found no breach of article 13 of the Convention.

On property, the court applied three tests: lawfulness, general interest and proportionality. The freeze rested on law. It served the general interest by keeping possible proceeds of crime from being hidden or spent before trial.

The applicants had not proved that the order was disproportionate in their case. The business kept trading under a court-appointed administrator, the applicant received a fixed sum, and the frozen assets were being preserved.

The court rejected the argument that a later amendment shows the earlier law was unlawful: “l-fatt li l-liġi ġiet emendata u tat jeddijiet aktar wiesgħa lir-rikorrenti ċertament huwa ameljorament favur l-istess rikorrenti iżda ma jfissirx li l-liġi kif kienet qabel ma kinitx tissodisfa l-element tal-proporzjonalita’” (the fact that the law was amended and gave the applicants wider rights is an improvement in their favour, but it does not mean that the law as it was before failed the test of proportionality).

Claims for lost stock, lost state aid and similar losses could not be decided while the criminal case was pending, because the court would have to take a view on guilt. The court found that any distress came from the criminal proceedings themselves, not from a breach of rights. It dismissed all the claims, with costs against the applicants.

Why it matters

An accused person who challenges a freezing order must prove disproportion on the facts, not only that the law has since become more generous. A record of granted variation requests will weigh against any claim that no effective remedy existed. Damages linked to the freeze are unlikely to be heard before the criminal case ends.

Where it sits

A freezing order is a temporary precautionary measure that secures possible confiscation after a conviction. A complaint about it falls under the second paragraph of article 1 of the First Protocol, which keeps the State's power to control the use of property in the general interest. The court asked the familiar question of fair balance between that interest and the owner's rights.

The court drew on local and Strasbourg authority. The Constitutional Court (31 January 2014) set out the three tests of lawfulness, legitimate aim and fair balance. The First Hall of the Civil Court (11 May 2017) held that the general interest must serve a concrete purpose, and the same court (15 April 2021) described the State's wide discretion in defining it. The European Court of Human Rights (28 January 2014) treated rent control as a control of use.

Source

First Hall of the Civil Court (Constitutional Jurisdiction), 334/2023, 3 March 2026.