AS TO THE ADMISSIBILITY OF
Application no. 44298/02
by Anders SYNNELIUS and EDSBERGS TAXI AB
The European Court of Human Rights (Third Section), sitting on 17 June 2008 as a Chamber composed of:
Boštjan M. Zupančič,
Ineta Ziemele, judges,
and Santiago Quesada, Section Registrar,
Having regard to the above application lodged on 11 December 2002,
Having regard to the observations submitted by the respondent Government and the observations in reply submitted by the applicants,
Having deliberated, decides as follows:
The first applicant, Mr Anders Synnelius, is a Swedish national who was born in 1957 and lives in Sollentuna. The second applicant, Edsbergs Taxi AB, is a Swedish limited liability company, owned by the first applicant and dissolved following bankruptcy in 1999. They are represented before the Court by Mr J. Thörnhammar, a lawyer practising in Stockholm. The Swedish Government (“the Government”) are represented by their Agent, Ms I. Kalmerborn, Ministry for Foreign Affairs.
The facts of the case, as submitted by the parties, may be summarised as follows.
1. The Tax Authority’s decisions on taxes and tax surcharges
In 1996 and 1997 the Tax Authority (skattemyndigheten) of the County of Stockholm carried out a tax audit concerning the second applicant’s taxi business during the income years 1993 and 1994, i.e. the assessment years 1994 and 1995. In audit reports of 19 March 1997 concerning the second applicant and of 17 June 1997 concerning the first applicant, the Tax Authority considered that revenues from the second applicant’s business and, consequently, also salary payments to the first applicant had not been accounted for in the tax returns for the income years in question. On the same days the reports were communicated to the applicants, who were given an opportunity to submit comments. Additional audit reports were drawn up on 30 October 1997. By decisions of 17 December 1997, the Tax Authority increased the applicants’ tax liability. Moreover, as the information supplied by them was found to be incorrect and, therefore, the taxation had been made under a discretionary assessment procedure, the Tax Authority ordered them to pay tax surcharges (skattetillägg, avgiftstillägg).
The additional income taxes levied on the first applicant, including tax surcharges, interest and late-payment fees (kvarskatteavgifter), amounted to 507,121 and 490,020 Swedish kronor (SEK), respectively for the two years in question. The surcharges amounted to SEK 119,620 and 118,193 (approximately 13,000 euros (EUR) per year) plus interest. The amounts were payable on 14 April 1998.
While the second applicant’s liability to income tax was lowered by minor amounts, its liability for employers’ contributions (arbetsgivar-avgifter) and value-added tax (mervärdesskatt), including tax surcharges and interest, was increased by a total of SEK 647,549 and 580,798, respectively for the two years. The surcharges amounted to SEK 87,193 and 80,559 (approximately EUR 9,000 per year) plus interest. The amounts were payable on 8 January 1998.
2. Requests for stays of execution
The applicants appealed against the Tax Authority’s decisions and requested that the execution of the various tax amounts be stayed until the matters had been finally examined by the courts.
On 15 May 1998 the Tax Authority rejected the request. It found, first, that the outcome of the cases could not be considered uncertain and, second, that, while enforcement of the amounts in question could cause considerable damage for the applicants as they did not have sufficient means to pay, they had failed to provide the required security.
The applicants appealed to the County Administrative Court (länsrätten) of the County of Stockholm, claiming, inter alia, that enforcement of the tax amounts before a court determination breached Article 6 of the Convention. On 17 July 1998 the Tax Authority reconsidered its decisions to reject a stay execution but did not change them.
By judgments of 28 September 1998, the court upheld the impugned decisions. It stated that Article 6 was not applicable in the cases and otherwise subscribed to the reasons given by the Tax Authority.
On 3 November 1998 and 25 January 1999, respectively, the Administrative Court of Appeal (kammarrätten) in Stockholm and the Supreme Administrative Court (Regeringsrätten) refused leave to appeal.
3. Enforcement measures
On 4 May 1998 the Enforcement Office (kronofogdemyndigheten) seized SEK 3,225 from the second applicant’s postal giro account. By a decision of 21 September 1998, it levied distress on the first applicant’s account. While the Office noted that the first applicant’s total tax debt including interest came to SEK 1,087,882, the actual amount seized was SEK 8,475.
Whereas the second applicant’s appeal was dismissed for having been lodged out of time, the first applicant’s appeal was rejected by the District Court (tingsrätten) of Stockholm by a decision of 30 March 1999. The court, inter alia, disagreed with the contention that the enforcement involved a violation of Article 6 of the Convention, finding that the latter provision was not applicable to matters relating to tax surcharges.
On 27 August 1999 and 18 July 2000, respectively, the Svea Court of Appeal (Svea hovrätt) and the Supreme Court (Högsta domstolen) refused the first applicant leave to appeal.
On 22 October 1998 the District Court of Sollentuna declared the second applicant bankrupt. No appeal was made against that decision. On 22 September 1999 the bankruptcy proceedings were terminated owing to a lack of assets.
4. Review of traffic licence
As the second applicant was registered as being in arrears with the taxes and tax surcharges imposed as a result of the Tax Authority’s decisions, the County Administrative Board (länsstyrelsen) of the County of Stockholm, on 15 May 1998, informed the company that it would review its eligibility for a traffic licence (trafiktillstånd). The company opposed a revocation of the licence. The matter was eventually struck out owing to the bankruptcy.
5. Criminal proceedings
On 6 June 1996 the Tax Authority reported the first applicant to the Regional Public Prosecution Office (regionåklagarmyndigheten) in Stockholm, claiming that proceeds in the amount of SEK 1,090,000 had not been accounted for in the bookkeeping of the taxi business. On 21 August 1996 the prosecutor decided to initiate a preliminary investigation. In the subsequent months, several persons were interviewed by the police.
At a police interview on 19 March 1997, the first applicant was formally notified that he was suspected of an aggravated bookkeeping offence. A preliminary investigation report was drawn up on 20 November 1997 and communicated for observations to the first applicant. A supplementary report was ready on 9 June 2000. On 10 July 2000 the first applicant was indicted for an aggravated bookkeeping offence committed during 1994. On 8 and 11 December 2000 the District Court of Sollentuna held a hearing in the case.
By a judgment of 29 December 2000, the District Court found the applicant guilty of having intentionally failed to enter proceeds of more than one million SEK as well as substantial salary payments in the books. This constituted an aggravated bookkeeping offence under Chapter 11, section 5, subsection 2 of the Penal Code (Brottsbalken). Such an offence is punishable by imprisonment, unless there are special circumstances. The court did not find that there were such special circumstances in the case. However, the court had regard to the length of the proceedings in sentencing the first applicant. Although it did not find that his rights under Article 6 of the Convention had been breached, it noted that Chapter 29, section 5 of the Penal Code prescribed that, when fixing a sentence, the court should take into account whether an exceptionally long period of time had passed since the offence was committed. Noting that six years had passed since the commission of the offence, the District Court concluded that the time during which the case had been pending at the public prosecutor’s office was not insignificant and that the first applicant had not been responsible for any delays. As called for by the public prosecutor, the court therefore found that there were grounds for giving the first applicant a suspended sentence. It further considered that there were special reasons to refrain from combining that sentence with a fine.
On 14 February 2002, following a hearing, the Svea Court of Appeal upheld the District Court’s judgment. On 12 June 2002, the Supreme Court refused leave to appeal.
6. Further proceedings on taxes and tax surcharges
As mentioned above, the applicants appealed against the Tax Authority’s decisions of 17 December 1997 to impose additional taxes and tax surcharges. On 27 September 1999 the Authority reconsidered its decisions but did not change them.
By judgments of 29 November 2001, the County Administrative Court upheld the Tax Authority’s decisions concerning the first applicant. In upholding the tax surcharges, the court had regard to a recent judgment of the Supreme Court (RÅ 2000 ref. 66), according to which the provisions of the Taxation Act (Taxeringslagen, 1990:324) relating to surcharges came under Article 6 of the Convention, but considered that, in the instant case, there was no ground for remitting the imposed surcharges.
On the same date, the County Administrative Court struck out the cases concerning the second applicant owing to the bankruptcy.
On 21 December 2001 the applicants appealed against the courts’ judgments and decisions.
On 13 September 2002 the first applicant also requested legal aid, referring to Article 6 § 3 (c) of the Convention. This was denied by the Administrative Court of Appeal on 16 September 2002. The Supreme Administrative Court granted leave to appeal on 5 November 2002 and obtained observations from the National Courts Administration (Domstolsverket) and the applicant. On 28 October 2003 the Supreme Administrative Court upheld the appealed decision. The court noted that, under the terms of the Legal Aid Act (Rättshjälpslagen, 1996:1619), the scope for granting legal aid to a businessman in a taxation case was very limited. In a case concerning tax surcharges, the application of Article 6 § 3 (c) would depend on the size of the surcharges and the nature of the case; only if the penalties were particularly heavy and the legal issues complicated could legal aid be granted by virtue of the Convention. The instant case concerned mainly the question whether the documentation obtained by the Tax Authority constituted a sufficient ground for increasing the first applicant’s liability to income tax. Although the documentation was relatively extensive, the legal issues relating to the taxation, and consequently also to the tax surcharges, were rather uncomplicated.
The first applicant was, however, represented by a lawyer throughout the tax proceedings, the same lawyer who acted as publicly appointed counsel for him in the criminal proceedings and who is representing him in the present proceedings before the Court.
By a decision of 2 March 2004, the Administrative Court of Appeal, referring to a recent judgment by the Supreme Administrative Court (RÅ 2002 ref. 76), found that a dissolved company always had a right to a review by an administrative court of tax surcharges imposed on it. The appellate court thus concluded that the second applicant had legal capacity (rättskapacitet) to act as a party in the taxation proceedings. Accordingly, the cases concerning the company were referred back to the County Administrative Court for examination.
By judgments of 16 November 2004, the County Administrative Court, in the cases referred back to it, upheld the Tax Authority’s decisions concerning the second applicant. The company’s appeal was dismissed on formal grounds by the Administrative Court of Appeal on 21 February 2005. The appellate court noted that the Supreme Administrative Court (RÅ 2003 ref. 53) had found that a dissolved company could not claim a right to a review of tax surcharges in two court instances pursuant to the provisions of the Convention. The appellate court therefore considered that the second applicant, through the examination by the County Administrative Court, had had a fair hearing within the meaning of the Convention and that there was no reason to grant a further exception to the rule that a dissolved company lacked legal capacity. Having regard to the Supreme Administrative Court’s finding, the second applicant did not appeal against the appellate court’s decision.
Also on 21 February 2005, the Administrative Court of Appeal upheld the County Administrative Court’s judgments of 29 November 2001 concerning the first applicant. On 3 January 2007 the Supreme Administrative Court refused the first applicant leave to appeal.
1. The applicants assert that the early enforcement of tax surcharges involved a violation of the presumption of innocence under Article 6 § 2 of the Convention.
2. They further complain under Article 6 § 1 that the taxation proceedings were not concluded within a reasonable time.
3. The first applicant complains that the length of the criminal proceedings was also unreasonable within the meaning of Article 6 § 1.
4. The first applicant maintains that the decision not to grant him legal aid in the taxation proceedings breached Article 6 § 3 (c).
5. Pointing out that the tax matters were dealt with in five different proceedings – concerning taxation, stay of execution, tax enforcement, criminal liability and review of traffic licence – and that he was punished twice – by the conviction for a bookkeeping offence and the imposition of tax surcharges – the first applicant submits that the principle of ne bis in idem, under Article 4 of Protocol No. 7 to the Convention, was violated. In the alternative, he claims that the multiplicity of proceedings violated the right to a fair hearing under Article 6 of the Convention.
1. The applicants assert that the early enforcement of tax surcharges – before there had been a court determination of their tax liability – involved a violation of the presumption of innocence under Article 6 § 2 of the Convention. The Court finds that this issue also raises the question whether the applicants had effective access to a court under Article 6 § 1. The relevant parts of Article 6 read as follows:
“1. In the determination of ... any criminal charge against him, everyone is entitled to a fair ... hearing within a reasonable time by [a] tribunal ...
2. Everyone charged with a criminal offence shall be presumed innocent until proved guilty according to law.”
The respondent Government submit that the second applicant did not exhaust domestic remedies in regard to these complaints and that both applicants failed to observe the six-month time-limit. In any event, the Government are of the opinion that the complaints are manifestly ill-founded.
The applicants maintain their complaints.
The Court reiterates that it has found in several judgments concerning Sweden that the imposition of tax surcharges involves the determination of a “criminal charge” within the meaning of Article 6 of the Convention, although they cannot be said to belong to criminal law under the Swedish legal system (see, for instance, Janosevic v. Sweden, no. 34619/97, §§ 64-71, ECHR 2002-VII).
The Court further reiterates its findings in these judgments in regard to the presumption of innocence (ibid., §§ 105-108), that an enforcement of surcharges prior to a court determination of the liability to pay the taxes and surcharges in question should be confined within reasonable limits that strike a fair balance between the interests involved and should be subjected to strict scrutiny. Restraint is thus called for when enforcement measures are decided and implemented and the consequences of early enforcement are to be taken into account when a request for stay of execution is examined. That these decisions are reasonably confined is of paramount importance also in affording the individual effective access to court for the determination of the tax surcharges (ibid., §§ 80-90).
Given the importance of the stay-of-execution decisions and the enforcement measures, the issues relating to presumption of innocence and effective access to court must be considered sufficiently separate from the remainder of the present application. The Court’s examination of these complaints thus requires that the applicants have exhausted the domestic remedies available against the relevant decisions and measures. Moreover, the starting-point of the assessment whether the complaints have been lodged in time must be the dates when the stay-of-execution decisions and enforcement measures were taken.
In regard to the instant complaints, the Court need not determine whether domestic remedies were exhausted in all respects by the applicants as, in any event, the relevant decisions and measures date back more than six months before these complaints were lodged. Thus, whereas the present application was introduced with the Court on 11 December 2002, the stay-of-execution proceedings in regard to both applicants ended already on 25 January 1999 with the Supreme Administrative Court’s decision to refuse leave to appeal. Moreover, the Enforcement Office’s seizure of funds from the first applicant became final when the Supreme Court refused leave to appeal on 18 July 2000. The seizure from the second applicant’s giro account was made on 4 May 1998 and the company was declared bankrupt by the District Court on 22 October 1998. On 22 September 1999 the bankruptcy proceedings were terminated.
Consequently, leaving aside the question whether the applicants exhausted domestic remedies, the Court notes that, in so far as it concerns the above complaints, the present application was introduced more than two years after the relevant national decisions and measures.
It follows that these complaints have been introduced out of time and must be rejected in accordance with Article 35 §§ 1 and 4 of the Convention.
2. The applicants further complain that the taxation proceedings were not concluded within a reasonable time, as required by Article 6 § 1 of the Convention.
The Government state that it may be questioned whether the length of the proceedings were reasonable insofar as the parts before the Tax Authority and the Supreme Administrative Court are concerned and therefore leave it to the Court to decide whether there has been a violation of Article 6 § 1.
The applicants maintain that the total duration of the proceedings breached Article 6 § 1.
The Court finds that the taxation proceedings began on 17 June and 19 March 1997, respectively, when the Tax Authority’s audit reports concerning the first and second applicants were finalised and communicated for comments. With respect to the first applicant, the proceedings ended on 3 January 2007, when the Supreme Administrative Court refused leave to appeal, and thus lasted approximately nine years and six and a half months. With respect to the second applicant, they ended on 21 February 2005, when the Administrative Court of Appeal dismissed its appeal, and thus lasted about seven years and eleven months.
The Court considers, in the light of the criteria established in its case-law on the question of “reasonable time” (the complexity of the case, the applicants’ conduct and that of the competent authorities), and having regard to all the information in its possession, that an examination of the merits of this complaint is required. Consequently, it should be declared admissible.
3. The first applicant complains that the length of the criminal proceedings was also unreasonable within the meaning of Article 6 § 1.
The Government submit that, having regard to the District Court’s mitigation of the sentence on account of the length of the proceedings, the first applicant could not claim to be a victim of a violation of Article 6. Alternatively, they maintain that this complaint is manifestly ill-founded.
The first applicant points out that, whereas the sentence was mitigated, the national courts did not acknowledge a breach of the Convention. He leaves it to the Court to decide whether he could still be considered a victim of a violation in this respect.
The Court notes that, at a police interview on 19 March 1997, the first applicant was formally notified that he was suspected of the bookkeeping offence in question. The criminal proceedings must be considered to have started on that date. They ended on 12 June 2002, when the Supreme Court refused leave to appeal, and thus lasted about five years and three months.
The question arises whether the applicant may claim to be a victim of a violation of Article 6 § 1 of the Convention on the ground that the length of the criminal proceedings against him was unreasonable. According to its established case-law, the mitigation of a sentence on the ground of the excessive length of proceedings does not in principle deprive the individual concerned of his status as a victim within the meaning of Article 34 of the Convention. However, this general rule is subject to an exception when the national authorities have acknowledged in a sufficiently clear way the failure to observe the reasonable time requirement and have afforded redress by reducing the sentence in an express and measurable manner (see, among other authorities, Eckle v. Germany, judgment of 15 July 1982, Series A no. 51, § 66, Beck v. Norway, no. 26390/95, § 27, 26 June 2001, and Jensen v. Denmark (dec.), no. 48470/99, ECHR 2001-X).
Applying these principles in the present case, the Court notes that, in the judgment of 29 December 2000, the District Court did not acknowledge that the first applicant’s rights under Article 6 of the Convention had been breached. However, it had regard to the length of the proceedings in sentencing him and, in substance, upheld the applicant’s complaint that the proceedings had been too lengthy. Thus, it noted that six years had passed since the offence was committed and that the case had been pending for a not insignificant period in the public prosecutor’s office. Moreover, it found that the applicant had not been responsible for the delay. In these circumstances, the District Court must be considered to have concluded in a sufficiently clear way that the length of the proceedings was such that it called for compensation in the form of a mitigation of the sentence.
Moreover, as a consequence of its conclusions, the District Court gave the applicant a suspended sentence instead of imprisonment, which the offence would otherwise have called for. It further decided not to combine the suspended sentence with a fine. Moreover, as the court found that there were no special circumstances warranting an exception from the prison sentence prescribed by law, the only ground for giving the first applicant a suspended sentence – and thus mitigating the sentence – was the lengthy proceedings. Accordingly, the Court considers that the first applicant was afforded adequate redress for the alleged violation and therefore can no longer claim to be a victim of a violation of Article 6 § 1 of the Convention (cf. Beck v. Norway, cited above, § 28).
It follows that this part of the application must be rejected as being manifestly ill-founded, pursuant to Article 35 §§ 3 and 4 of the Convention.
4. The first applicant maintains that the decision not to grant him legal aid in the taxation proceedings breached Article 6 § 3 (c). This provision reads as follows:
“Everyone charged with a criminal offence has the following minimum rights:
(c) to defend himself in person or through legal assistance of his own choosing or, if he has not sufficient means to pay for legal assistance, to be given it free when the interests of justice so require”
The Government refer, inter alia, to the reasons given by the Supreme Administrative Court in its decision of 28 October 2003 and maintain that the interests of justice did not require that the first applicant be afforded free legal assistance within the meaning of Article 6 § 3 (c).
The first applicant submits that the case in question was a pilot case with legal consequences for other cases and that it involved different legal aspects and examination of evidence. Moreover, it concerned tax surcharges of considerable amounts. Due to a lack of financial resources, he could not pay for legal assistance himself. Thus, the requirement of a fair trial called for the grant of free legal aid.
The Court first observes that, although not absolute, the right of everyone charged with a criminal offence to be effectively defended by a lawyer assigned officially if need be, is one of the fundamental features of a fair trial (see Poitrimol v. France, judgment of 23 November 1993, Series A no. 277-A, § 34). Still, the right to free legal assistance under Article 6 § 3 (c) of the Convention is subject to two conditions. Firstly, the applicant must lack sufficient means to pay for legal assistance. Secondly, the “interests of justice” must require that legal aid be granted.
As concerns the first condition, the Court notes that the first applicant has stated that he did not have sufficient means to pay for legal assistance himself. However, the Court does not find it necessary to decide on this issue since, in any event, the second condition is not fulfilled for the following reasons.
The Court has to take into consideration several factors to determine whether the interests of justice required that legal aid be granted before the domestic courts. This is to be judged by reference to the facts of the case as a whole having regard, inter alia, to the seriousness of the offence, the severity of the possible sentence, the complexity of the case and the personal situation of the accused (see Quaranta v. Switzerland, judgment of 24 May 1991, Series A no. 205, §§ 32-36).
As to the seriousness of the offence and the severity of the possible sentence, the Court observes that the cases before the national courts mainly concerned tax assessments for 1994 and 1995 and that the only question to fall within the criminal sphere of Article 6 of the Convention was whether or not to impose tax surcharges. Although the tax surcharges amounted to approximately EUR 13,000 per year for the first applicant, it should be pointed out that, according to Swedish law, failure to pay the surcharges could not have been converted into a prison sentence. Consequently, the first applicant never faced a risk of being deprived of his liberty (cf. Benham v. the United Kingdom, judgment of 10 June 1996, Reports of Judgments and Decisions 1996-III, § 61, and Padalov v. Bulgaria, no. 54784/00, § 43, 10 August 2006).
In so far as the complexity of the case is concerned, the Court reiterates that it mainly concerned the first applicant’s tax assessments. Moreover, the contentious issues before the national courts related primarily to the assessment of evidence, i.e. whether the business revenues had been properly accounted for in the tax returns. The Court cannot find that any complex legal questions were to be argued in the cases. Furthermore, the assessment relating to the tax surcharges was relatively straightforward in that the issue to be determined was whether or not the first applicant had submitted incorrect or incomplete information to the Tax Authority and, if so, whether there were any grounds for remission of the surcharges.
As to the personal situation of the first applicant, reference is made to the Supreme Administrative Court’s decision of 28 October 2003 in which the court noted that the first applicant was a businessman. Moreover, the case concerned the taxation of his business activities with which he should be thoroughly familiar. The Court finds it unlikely that he would have been unable to present his case and arguments adequately, without legal assistance, before the national courts. Even if he were to have certain difficulties, it should be stressed that the Swedish administrative courts have an obligation under the Administrative Court Procedure Act to ensure that the circumstances of each case are clarified to the extent that its character demands and that, if there is a need, they shall direct the parties how to supplement the case-file with the necessary information.
In this connection, the Court further notes that the first applicant was, in fact, represented by a lawyer throughout the tax proceedings, despite the refusal of legal aid, and that the same lawyer had acted as defence counsel for him in the related criminal proceedings where he had been granted free legal aid.
Finally, the Court takes note of the fact that the Supreme Administrative Court, in rejecting the request for legal aid, specifically assessed the matter with reference both to domestic law and to Article 6 § 3 (c) the Convention.
In view of all of the above, the Court finds that there is no indication that the refusal of legal aid adversely affected the possibility for him to present his case properly and satisfactorily (see Airey v. Ireland, judgment of 9 October 1979, Series A no. 32, §§ 24 and 26, Gnahoré v. France, no. 40031/98, §§ 39-41, ECHR 2000-IX, and Barsom and Varli v. Sweden (dec.), nos. 40766/06 and 40831/06, 4 January 2008). Consequently, in the present case, the interests of justice did not require that the first applicant be granted free legal assistance. Thus, the decision to refuse legal aid did not involve a violation of Article 6 § 3 (c) of the Convention.
It follows that this part of the application must also be rejected as being manifestly ill-founded, pursuant to Article 35 §§ 3 and 4 of the Convention.
5. Referring to the multiplicity of proceedings, the first applicant finally claims that the principle of ne bis in idem, under Article 4 of Protocol No. 7 to the Convention, was violated. Alternatively, he submits that this involved a violation of the right to a fair hearing under Article 6 of the Convention. Article 4 § 1 of Protocol No. 7 provides the following:
“No one shall be liable to be tried or punished again in criminal proceedings under the jurisdiction of the same State for an offence for which he has already been finally acquitted or convicted in accordance with the law and penal procedure of that State.”
The Court notes that the aim of Article 4 of Protocol No. 7 is to prohibit the repetition of criminal proceedings which have been concluded by a final decision (see Gradinger v. Austria, judgment of 23 October 1995, Series A no. 328-C, p. 65, § 53). In order to determine whether there has been such repetition, the character of the offences at issue in the various proceedings has to be established; more precisely, the Court has to examine whether or not the offences have the same essential elements (see Franz Fischer v. Austria, no. 37950/97, 29 May 2001, § 25).
The Court first finds that the decisions on the request for a stay of execution and the enforcement measures, invoked by the applicant in the present context, concern the tax surcharges and, thus, the taxation proceedings. They have no independent importance for the examination under Article 4 of Protocol No. 7. Moreover, the review of the traffic licence was never pursued owing to the second applicant’s bankruptcy. Thus, the issue raised by the instant complaint is confined to a determination whether the proceedings concerning the aggravated bookkeeping offence and those involving the tax surcharges were criminal proceedings conducted in regard to offences with the same essential elements.
As noted above, the imposition of tax surcharges involved the determination of a “criminal charge” within the meaning of Article 6 of the Convention. Moreover, in its judgment in the case of Göktan v. France (no. 33402/96, § 48, ECHR 2002-V) concerning Article 7 of the Convention and Article 4 of Protocol No. 7, the Court held that the notion of penalty should not have different meanings under different provisions of the Convention. Likewise, in the decision in the case of Manasson v. Sweden (no. 41265/98, 8 April 2003), it was concluded that proceedings involving tax surcharges were “criminal” not only for the purpose of Article 6 of the Convention, but also for the purpose of Article 4 of Protocol no. 7 to the Convention. Accordingly, noting that the bookkeeping offence was clearly determined in criminal proceedings, the Court considers that both proceedings were criminal in nature for the purpose of the invoked provision.
In regard to the elements of the two offences, the Court first observes that the obligation of a company and its responsible representative to enter correct figures in the books is an obligation per se, which is not dependent on the use of bookkeeping material for the determination of tax liability. In this connection, it should be noted that, although the first applicant had not fulfilled the legal bookkeeping requirements, he could have complied with the duty to supply the tax authorities with sufficient and correct information by submitting other material which could adequately form the basis of a tax assessment.
With respect to the conduct attributed to the first applicant in the two proceedings, the Court notes that he was finally convicted by the Court of Appeal on 14 February 2002 pursuant to Chapter 11, section 5, subsection 2 of the Penal Code for having intentionally failed to enter proceeds of more than one million SEK as well as substantial salary payments in the books for 1994. The tax surcharges, however, were imposed on him by the Tax Authority and the administrative courts pursuant to the Taxation Act because the information he had supplied in his tax returns for the assessment years 1994 and 1995 had been incorrect and had necessitated a discretionary tax assessment.
Whereas a conviction for a bookkeeping offence requires intent or negligence, these subjective elements are not a condition for the imposition of tax surcharges (see Rosenquist v. Sweden (dec.), no. 60619/00, 14 September 2004). Thus, the applicant was convicted for a bookkeeping offence as he had intentionally failed to record important events in the company’s books. In contrast, the Tax Authority ordered him to pay tax surcharges due to the incorrect information supplied in his tax returns regardless of intent or negligence.
In the light of the above considerations, the Court finds that the two offences in question were entirely separate and differed in their essential elements (see Ponsetti and Chesnel v. France (dec.), nos. 36855/97 and 41731/98, ECHR 1999-VI, and Rosenquist v. Sweden, cited above). Against this background, the Court does not find that the proceedings at issue disclose any failure to comply with the requirements of Article 4 of Protocol No. 7 to the Convention. Nor does it find that they involved a violation of the right to a fair hearing under Article 6 of the Convention.
It follows that this part of the application must also be rejected as being manifestly ill-founded, pursuant to Article 35 §§ 3 and 4 of the Convention.
For these reasons, the Court unanimously
Declares admissible, without prejudging the merits, the applicants’ complaint concerning the length of the taxation proceedings;
Declares inadmissible the remainder of the application.
Santiago Quesada Josep
SYNNELIUS AND EDSBERGS TAXI AB v. SWEDEN DECISION
SYNNELIUS AND EDSBERGS TAXI AB v. SWEDEN DECISION