BRUSSELS (AFP) — A European court on Thursday annulled an EU decision to freeze the assets of the main Iranian opposition in exile, dealing a fresh blow to the bloc’s attempts to keep the group on its terror blacklist.

The Court of First Instance ruled that the EU had failed to give sufficient reasons to keep the People’s Mujahedeen of Iran (PMOI) on the list, following a British court decision to remove them from the national list.

It was the second such ruling by the court, which is Europe’s second-highest tribunal.

The EU’s decision was based on measures implemented to respect a UN Security Council resolution drawn up in the wake of the September 11, 2001 attacks which required countries to crack down on terror funding.

Since the EU terror list is updated every six months, and the court ruling refers to an EU decision in December 2007 and not the current list, the group remains on the EU terror blacklist for the time being.

But given the same court handed down a similar ruling on the group in December 2006, this latest verdict increases the pressure on the European Union to heed the court and keep the PMOI name off future lists.

Founded in 1965 with the aim of replacing first the Shah and then the clerical regime in Iran, PMOI has in the past operated an army inside Iran.

It was the armed wing of the France-based National Council of Resistance of Iran (NCRI) but it renounced violence in June 2001.

Exiled Iran opposition leader Maryam Rajavi — who has residency in France, regularly visits Brussels and despite the ban has been tolerated by the European authorities — welcomed the court’s decision.