"In understanding the importance of this ruling it is important to remember that it is a legal ruling of a court; it is not a political decision taken by the EU government. The separation of the judicial system from the legislature is a key distinction in a healthy democracy," EU's statement said.
It said the legal ruling was clearly based on procedural grounds and it does not imply any assessment by the court of the substantive issues of designating the LTTE or of freezing LTTE funds.
The court annulled specific restrictive measures directed against certain persons and entities by the EU with its view of combating terrorism.
It was, however, based on a fundamental procedural ground. The said annulment would be maintained temporarily for a period of three months where a reassessment would be made.
Sri Lankan government would be able to appeal against the decision within two months.
Sri Lanka has said it will contest the decision to delist the LTTE as a terrorist organisation and will lobby the EU against the order.
President Mahinda Rajapaksa, who seeks a third term, has accused opposition leaders of having talks with the pro-LTTE diaspora in Europe.
The state-media named the main opposition leader Ranil Wickremesinghe as "instrumental" in the EU's lifting of the LTTE's terrorist tag.
Opposition UNP, however, counter charged that the Rajapaksa administration's foreign policy drivers had failed to convince the EU on the need to keep the LTTE in the terrorist list.
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