Carlo Ranzoni;Egidijus Kūris;Ganna Yudkivska;Vincent A. De Gaetano;Georges Ravarani

The applicant, Ms Danutė Mockienė, is a Lithuanian national who was born in 1959 and lives in Mažeikiai.

The applicant was employed as an official at the Prisons Department until 31 January 2004, when she was discharged for health reasons. She was entitled to a service pension (valstybinė pensija) of 854 Lithuanian litai (LTL; approximately 247 euros (EUR)) per month from the date she left her job.

According to Lithuanian law, service pensions are not related to social insurance contributions but are paid from the State budget to individuals because of their merits or for service to the State (see paragraphs 19-20 below). State officials who are entitled to service pensions are also insured by the mandatory State social insurance scheme and are entitled to other types of welfare benefit, save in exceptional cases provided by law (see paragraph 21 below).

On 9 December 2009 the Lithuanian Parliament enacted the Provisional Law on the Recalculation and Payment of Welfare Benefits (Socialinių išmokų perskaičiavimo ir mokėjimo laikinasis įstatymas; hereinafter, “the Provisional Law”), which entered into force on 1 January 2010. According to the law’s preamble, the State budget deficit had been constantly increasing because of the economic crisis of that time and measures were needed to stabilise it (see paragraph 23 below). The Provisional Law set down rules for recalculating various welfare benefits, such as retirement pensions, disability benefits, maternity and paternity benefits, sickness benefits, unemployment benefits and service pensions, among others (see paragraph 24 below).

An explanatory report appended to the Provisional Law stated that the economic crisis had led to numerous legal acts being amended in an attempt to stabilise the State budget deficit – civil servants’ salaries had been reduced and there had been changes in tax law. However, further measures were considered necessary to address the crisis. The explanatory report referred to the work plan of the Government, which had set down the guidelines for addressing the economic slowdown in the face of the global financial crisis (see paragraph 22 below). It also referred to several Constitutional Court rulings adopted in 2002-2007, which had held that individuals entitled to certain welfare benefits had a legitimate expectation that they would continue to receive them; however, in the face of an exceptional situation, when the State was unable to acquire sufficient funds to continue the payment of welfare benefits, they could be temporarily reduced to the extent necessary to ensure the protection of constitutional values and the balance between the interests of individuals and those of society.

In line with Article 4 of the Provisional Law, service pensions were reduced by 5-20%, depending on their size, but the final amount after the recalculation could not be below LTL 650 (approximately EUR 188) a month (see paragraphs 25-26 below).

Article 15 of the Provisional Law stated that the law would expire on 31 December 2011, but that provision was subsequently amended several times. The Provisional Law ceased to apply on 31 December 2011 with regard to retirement pensions, disability benefits, maternity and paternity benefits, sickness benefits, and child benefit, but remained applicable with regard to service pensions until 31 December 2013.

Article 16 § 4 of the Provisional Law instructed the Government to prepare the necessary legal acts to establish a compensation mechanism for reduced retirement pensions and benefits for lost working capacity. It did not make any mention of a compensation mechanism for the other benefits that had been reduced (see paragraph 10 below).

On 29 June 2010 the Constitutional Court found that Article 16 § 4 of the Provisional Law (see paragraph 9 above) was not in compliance with the Constitution in so far as it had not required a compensation mechanism for those service pensions which had been reduced significantly (dideliu mastu; see the relevant excerpts in paragraph 27 below).

On 6 February 2012 the Constitutional Court issued a ruling which examined the compliance, inter alia, of Article 4 § 1 of the Provisional Law (see paragraph 7 above) with the Constitution. It reiterated that the State was justified in introducing temporary reductions in various welfare benefits when faced with an economic crisis, as long as those reductions respected the constitutional principles of the rule of law and non-discrimination, among others. The Constitutional Court concluded that Article 4 § 1 of the Provisional Law was in compliance with the Constitution because it had provided that service pensions could not be reduced by more than 20%, which could not be considered as “significant”. The absence of a compensation mechanism for service pensions reduced in line with Article 4 § 1 had therefore not breached the Constitution (see the relevant excerpts in paragraph 28 below). The ruling was published in the Official Gazette and entered into force on 21 September 2012.

On 14 May 2015 the Constitutional Court found that the different expiry dates for reductions in service pensions and other welfare benefits in Article 15 of the Provisional Law (see paragraph 8 above) were compatible with the Constitution in view of the “different nature and character” of service pensions compared with other benefits (see the relevant excerpts in paragraph 29 below).

In accordance with Article 4 § 1 of the Provisional Law (see paragraphs 7 above and 26 below), the applicant’s service pension was reduced on 1 January 2010 by approximately 15% to LTL 724 (approximately EUR 210) per month.

On 4 March 2011 the applicant brought a claim against the State. She requested that her service pension be restored to its pre-2010 level and that she be compensated for the period of reduced pension. The applicant also asked the court to seek a ruling from the Constitutional Court as to whether various provisions of the Provisional Law were in compliance with the Constitution.

On 2 November 2011 the Vilnius Regional Administrative Court adjourned the applicant’s case on the grounds that several requests concerning the compliance of the Provisional Law with the Constitution were pending before the Constitutional Court. The case was adjourned until the entry into force of the Constitutional Court’s ruling of 6 February 2012 (see paragraphs 11 above and 28 below).

On 13 November 2012 the Vilnius Regional Administrative Court dismissed the applicant’s claim. It held that the applicant’s service pension had been reduced in accordance with Article 4 § 1 of the Provisional Law, which the Constitutional Court had found to be in compliance with the Constitution (see paragraphs 7 and 11 above and 28 below). There were therefore no grounds to restore her pension to its pre-2010 level or compensate her for the period of reduction.

On 6 June 2013 the Supreme Administrative Court dismissed an appeal by the applicant and upheld the findings of the first-instance court.

The relevant provisions of the Constitution read:

“Any law or other act that contradicts the Constitution shall be invalid.

“Property shall be inviolable.

The rights of ownership shall be protected by law.

Property may be taken only for the needs of society according to the procedure established by law and shall be justly compensated for.”

“All persons shall be equal before the law, courts, and other state institutions and officials.

Human rights may not be restricted; no one may be granted any privileges on the grounds of gender, race, nationality, language, origin, social status, belief, convictions, or views.”

“The State shall guarantee its citizens the right to receive retirement and disability pensions, as well as social assistance in the event of unemployment, sickness, widowhood, loss of the breadwinner, and in other cases provided for by law.”

“A law (or part thereof) of the Republic of Lithuania ... may not be applied from the day of the official publication of the decision of the Constitutional Court that the act in question (or part thereof) is in conflict with the Constitution of the Republic of Lithuania.

The decisions of the Constitutional Court on the issues assigned to its competence by the Constitution shall be final and not subject to appeal.

Articles 1 and 4 of the Law on Service Pensions (Valstybinių pensijų įstatymas) list the categories of people who are entitled to service pensions, such as State officials, soldiers, judges, scientists, former deportees, resistance fighters, Olympic medalists, and others; separate laws set out the specific regulations for each category (see, for example, paragraph 20 below). Article 2 provides that service pensions are paid from the State budget. Article 3 provides that a person who is entitled to several service pensions can only receive one, of his or her choice.

Article 1 of the Law on the Service Pensions of Officials and Soldiers (Karių ir pareigūnų valstybinių pensijų įstatymas) lists the categories of State officials who are entitled to service pensions, such as Interior Ministry service officials, professional soldiers, prosecutors, Prisons Department officials, customs and border officers, and others. Article 3 § 1 provides that officials become eligible for a service pension after serving for a certain length of time or after being discharged for health reasons related to their duties. Article 7 sets the rules for calculating the amount of service pension, linking it to length of service and the average salary received during that time.

Article 2 § 1 of the Law on State Social Insurance Pensions (Valstybinių socialinio draudimo pensijų įstatymas) provides that State officials are insured by the mandatory State social insurance scheme. Article 5 § 3 provides that individuals who are entitled to a State social insurance pension do not lose the right to receive service pensions or other benefits, save for exceptional cases provided by law.

The work plan of the Lithuanian Government, adopted in December 2008, stated that one of the main priorities of the Government was to prepare for the economic slowdown in the face of the serious global financial crisis. It set down guidelines for decreasing public spending, reforming tax law, balancing cash flows, and encouraging private businesses, among other things.

The preamble to the Provisional Law (see paragraph 5 above), provides:

“The Parliament of the Republic of Lithuania,

Acknowledging that forecasts for the State budget and the budget of the State Social Insurance Fund indicate constant increases in the deficit caused by the economic crisis in Lithuania;

Emphasising the need to stabilise the increase in the deficit in the State budget and the budget of the State Social Insurance Fund and to balance cash flows;

Aiming, as far as possible, to protect vulnerable groups in society and to ensure the timely payment of benefits during the economic crisis;

Having regard to the fact that the Constitutional Court of the Republic of Lithuania has repeatedly held that in exceptional situations (economic crises, natural disasters, and so forth), when it is impossible to acquire sufficient funds for the payment of welfare benefits, the legal regulation concerning such benefits can be amended and the benefits temporarily reduced for the duration of the exceptional situation to the extent necessary for ensuring the protection of the vitally important interests of society and other constitutional values;

Hereby enacts this provisional law.”

Article 1 § 2 of the Provisional Law lists the categories of welfare benefits to which it applies:

“2. The present law is applicable to recipients of the following benefits:

1) service pensions awarded in accordance with the Law on Service Pensions, the Law on the Service Pensions of Officials and Soldiers, the Law on Judges’ Service Pensions, and the Provisional Law on the Service Pensions of Scientists;

2) compensation awarded in accordance with the Law on Theatres and Concert Halls;

3) annuities awarded in accordance with the Law on the President’s State Annuity, the Law on the Status of Signatories of the Act of Lithuanian Independence and the Law on Physical Training and Sport;

4) relief benefits paid to employable individuals of working age and benefits for nursing or care awarded in accordance with the Law on Relief Benefits;

5) state social insurance retirement pensions, except for recipients who have a high level of special needs; early retirement pensions; benefits for lost working capacity (disability) awarded to those who have lost 45-70% of their working capacity (disability of the second and third category) [and other welfare benefits] awarded in accordance with the Law on State Social Insurance Pensions and the Law on State Social Insurance Early Retirement Pensions;

6) sickness, professional rehabilitation, maternity and paternity benefits awarded in accordance with the Law on Sickness and Maternity Social Insurance;

7) sickness benefits awarded in accordance with the Law on Work-Related Accidents and Professional Sickness Social Insurance;

8) maternity (paternity) benefits awarded to State officials and soldiers from the State budget in accordance with the relevant legal acts;

9) child benefit awarded in accordance with the Law on Child Benefit;

10) unemployment benefits awarded in accordance with the Law on Unemployment Social Insurance.”

Article 3 § 1 of the Provisional Law establishes a minimum threshold (ribinis dydis) of LTL 650 (approximately EUR 188).

Article 4 § 1 of the Provisional Law establishes that service pensions and some other welfare benefits are to be recalculated in accordance with the rules set forth in Annex 1 of the Law. Annex 1 sets recalculation coefficients ranging from 5-20%, with a higher coefficient being applied to higher benefits. Article 4 § 5 provides that the minimum set out in Article 3 § 1 (see paragraph 25 above) is paid if the amount after the recalculation is below or equal to that level.

In its ruling of 29 June 2010 the Constitutional Court held:

“In an exceptional situation when, inter alia, it is impossible because of an economic crisis to bring in sufficient funds to pay service pensions, the legislature, when reducing service pensions significantly, must establish ... a compensation mechanism to oblige the State, once the exceptional situation is over, to provide compensation, fairly and without an unreasonable delay, for the losses endured by such persons because of their reduced service pensions ...

Therefore, according to the Constitution, compensation must be provided for losses resulting from a significant reduction in service pensions ... Article 16 § 4 of the Provisional Law ... which instructs the Government to establish a compensation mechanism only for retirement pensions and benefits for lost working capacity and not for significantly reduced service pensions, cannot be justified under the Constitution.”

In its ruling of 6 February 2012 the Constitutional Court held:

“The Provisional Law, as stated in its preamble, was enacted to limit increases in the deficit of the State budget and the budget of the State Social Insurance Fund caused by the economic crisis. Having regard to the especially difficult economic and financial situation in the State, and aiming to protect, to the greatest extent possible, socially vulnerable groups, the Law set down the rules for the recalculation of welfare benefits, which led to the reduction of those benefits. At the same time, the Law established certain thresholds: welfare benefits which did not exceed a minimum threshold could not be reduced, whereas those which exceeded that minimum threshold could be reduced only to the extent provided for in the Law.

It must be emphasised that the Provisional Law is of only temporary application. Furthermore, it instructs the Government to adopt the necessary regulations to establish a compensation mechanism for reduced retirement pensions and benefits for lost working capacity.

The Constitutional Court has repeatedly held that service pensions, which are not explicitly provided for in Article 52 of the Constitution, differ from social insurance pensions by their nature and character. They are awarded to people for their service or merits to the State of Lithuania ... and they are paid from the State budget. Receipt of those pensions is not linked to contributions to the social insurance system, but to a certain status (such as service, merits or other relevant circumstances). The specific character of service pensions permits the legislature to establish the conditions for awarding them; the legislature’s discretion in that regard is wider than in the regulation of other pensions. The conditions for awarding service pensions can vary greatly and depend on, inter alia, the nature of the service and the State’s financial resources. The legislature can also establish a maximum number for such pensions. Nonetheless, the people who fulfil the conditions established by law are entitled to receive the corresponding service pension and the State owes them a legal obligation to pay such a pension ...

The Constitutional Court has also held that the specific character of service pensions ... implies that the legislature may amend the legal regulation and reduce those pensions to a greater extent than retirement pensions or disability benefits ...

The specific character of service pensions also implies that the compensation provided for losses incurred because of a reduction in those pensions may be smaller than for losses incurred because of a reduction in retirement or disability pensions ...

As already stated above, the Provisional Law was enacted to limit increases in the deficit of the State budget and the budget of the State Social Insurance Fund caused by the economic crisis; it set down rules for the recalculation of welfare benefits which led, inter alia, to the temporary reduction of those benefits ... It must be underlined that when recalculating service pensions in line with Article 4 § 1, the pension cannot be reduced by more than 20% ...

Taking into account the fact that in line with Article 4 § 1 of the Provisional Law a service pension ... cannot be reduced by more than 20%, there are no grounds to find that such a legal regulation reduces service pensions significantly.

Accordingly, there are no grounds to find that the absence of a mechanism in the Provisional Law designed to compensate people whose service pensions were reduced in line with Article 4 § 1 ... is not in compliance with Articles 23, 29 and 52 of the Constitution or the constitutional principle of a State under the rule of law.

In its ruling of 14 May 2015 the Constitutional Court held:

“The State’s constitutional duty to accumulate the funds necessary for the payment of benefits in order to repeal laws which have reduced them, ... cannot be interpreted as a duty to repeal [such laws] only when it becomes possible to accumulate sufficient funds to restore all the reduced benefits. When it becomes possible to accumulate a part of such funds, the legislature, taking into account the State’s economic and financial situation, its means, and the various obligations which it has undertaken, can decide to restore benefits of a different nature and character at different times or to a different extent. When making such a decision, the legislature must comply with the Constitution and the constitutional requirements of, inter alia, a State under the rule of law, equality of persons, equity, and proportionality, and with the requirement to take into consideration the specific circumstances and differences between the legal status of the persons who will be subject to a different legal regulation.

Accordingly, the legal regulation which established a longer period of reduction in service pensions ... than in some other welfare benefits ... is considered as a reduction in service pensions to a greater extent in view of their different nature and character in comparison with other welfare benefits (inter alia, retirement pensions and disability benefits), that is to say, as an objectively justified difference in the treatment of different categories of beneficiaries ...

Therefore, there are no grounds to find that [the amended Article 15 of the Provisional Law] violated the constitutional principles of a State under the rule of law, equality of persons, equity, and proportionality.”

The relevant domestic law and practice concerning the length of court proceedings and available domestic remedies is summarised in Savickas and Others v. Lithuania ((dec.), nos. 66365/09 and 5 others, §§ 2139, 15 October 2013).


Violation of Article 6 - Right to a fair trial (Article 6 - Criminal proceedings;Article 6-1 - Access to court;Fair hearing);No violation of Article 6 - Right to a fair trial (Article 6 - Criminal proceedings;Article 6-1 - Fair hearing)

Julia Laffranque;Paul Lemmens;Stéphanie Mourou-Vikström;Georges Ravarani;Ksenija Turković

The facts of the case, as submitted by the parties, may be summarised as follows.

The first and second applicants’ son was killed in a traffic accident on 17 July 2010 in which the fourth applicant sustained serious injuries. The third applicant is the fourth applicant’s mother.

The applicants joined the criminal proceedings concerning the accident as victims.

On 9 and 10 December 2010 the applicants lodged a civil action within the criminal proceedings against the suspect, J., claiming compensation for non-pecuniary damage and reimbursement of the legal costs incurred in the criminal proceedings.

On 28 January 2011 the applicants, represented by lawyers of their own choice, concluded an out-of-court settlement with J. (hereinafter “out-of-court settlement agreement”). They informed the prosecutor that they had agreed that the case would be settled (kokkuleppemenetlus). J. informed the prosecutor that he had paid the compensation to the applicants as laid down in the out-of-court settlement agreement.

On 4 February 2011 the applicants’ consent to the application of the settlement procedure was recorded in a report signed by the prosecutor and the applicants’ representatives. The report stated that the applicants had been informed of their rights under the settlement procedure and set out the consequences of applying the settlement procedure. In a section entitled “Remarks”, it was noted that the applicants had given up their claims in respect of non-pecuniary damage against J. (as lodged on 9 and 10 December 2010), but had not given up their claim for reimbursement of the legal costs incurred in the criminal proceedings. The report also stated that the victims had no right to withdraw their consent to the settlement procedure. At that time, the applicants had submitted neither an itemised list of legal costs nor any supporting documents.

On 11 February 2011 J. gave his consent to the application of the settlement procedure. The prosecutor, J. and the latter’s counsel signed a settlement agreement in which they agreed, inter alia, on the type and extent of the damage caused. The agreement stated that the victims had withdrawn the civil claims they had lodged within the criminal proceedings.

On 14 February 2011 the Harju County Court committed J. for trial and scheduled a hearing for 7 March 2011. J., his counsel and the prosecutor were summoned to appear at the court hearing. The applicants, however, were not summoned.

On 4 March 2011 the applicants lodged a claim for legal costs in the amount of 6,483.66 euros (EUR) and submitted supporting documents. The Harju County Court received their submission on 7 March 2011.

J., his counsel and the prosecutor attended the hearing held before the Harju County Court as scheduled. According to the court record, the trial judge disclosed the applicants’ claim for reimbursement of their legal costs. J. asked the court not to examine the claim as it had been absorbed by the out-of-court settlement agreement. The applicants alleged that they had not been allowed to address the court notwithstanding their presence in the court building.

In a judgment of the same date, the Harju County Court convicted J. of violating traffic and driving regulations and sentenced him to a suspended prison term. It also withdrew J.’s driving licence and ordered him to pay the State Treasury expenses consisting of compensation levies (sundraha) and the cost of expert assessments. It held that the victims had given up the civil claims they had lodged within the framework of the criminal proceedings. The judgment made no reference to the applicants’ claim for reimbursement of the legal costs incurred in the criminal proceedings.

The applicants lodged an appeal against that judgment. They complained that they had not been allowed to attend the court hearing of 7 March 2011 and that the court had left their claim for reimbursement of the legal costs undecided.

On 23 March 2011 the Harju County Court refused to examine the appeal. Relying on Articles 246 and 318 of the Code of Criminal Procedure (CCrP; Kriminaalmenetluse seadustik), the court found that the applicants had not been parties to the court proceedings and did not, therefore, have the right to appeal (see paragraph 29 below).

The applicants appealed against the County Court’s decision, insisting that they had been parties to the proceedings and had the right to appeal.

At a public hearing on 5 April 2011 the Tallinn Court of Appeal examined the appeal in the presence of J. and his counsel, the prosecutor and the applicants’ counsel. At the hearing, the prosecutor firstly noted that the applicants had not submitted any documents concerning their claim for legal costs, despite the fact that they had had a week after the settlement to do so. According to the report of the hearing, the prosecutor later noted that those documents could have been submitted when the applicants had signed the report (see paragraph 10 above) or a few days later. The report stated that J. had wanted to submit the out-of-court settlement agreement to the judge in order to prove that it covered all the relevant damages. However, the Court of Appeal had refused, considering that it did not concern the subject matter of the dispute before the court in those proceedings.

By a decision of 13 April 2011, the Tallinn Court of Appeal dismissed the applicants’ appeal and upheld the Harju County Court’s decision of 23 March 2011. It referred to Article 243 of the CCrP, under which the victim was not entitled to revoke his or her consent to the application of the settlement procedure, and to Article 246 of the Code, which provided that the victim did not have to be summoned to a court hearing in settlement proceedings (see paragraphs 28 and 29 below). The Court of Appeal concluded that the applicants, as victims, had not been parties to such court proceedings and that, accordingly, they had no right to appeal against the County Court’s judgment.

Although the Court of Appeal’s decision stated that it was final and not amenable to appeal, the applicants’ counsel nevertheless challenged it before the Supreme Court.

By a decision of 3 October 2011 in case no. 3-1-1-60-11 the Supreme Court refused to examine the appeal on points of law because the Court of Appeal’s decision had been final and not amenable to appeal. It nevertheless stated that according to the established case-law, in settlement proceedings the court should not limit itself to merely analysing the settlement reached. It must also verify whether there were still questions that should be addressed in the subsequent judgment, but which had not been included in the settlement agreement. The court noted that according to Article 245 of the CCrP, the settlement agreement did not necessarily have to address matters dealing with the costs of criminal procedure or cover the extent of granting the civil claim or of compensating for the damage caused by the criminal offence. However, referring to Article 306 §§ 11, 13 and 14 of the CCrP and Article 248 § 1 (3) of the CCrP, the Supreme Court considered that those matters should not be overlooked by the court concerned (see paragraphs 30 and 31 below).


Aleš Pejchal;Angelika Nußberger;Ganna Yudkivska;Helena Jäderblom;Mark Villiger;Vincent A. De Gaetano

The applicant, Mr Björn Henriksson, is a Swedish national, who was born in 1940 and lives in Söderhamn. He was represented before the Court by Mr B. Leidhammar and Mr C. Crafoord, lawyers practising in Stockholm.

The Swedish Government (“the Government”) were represented by their Agents, Ms I. Kalmerborn, Ms H. Kristiansson and Mr. A. Rönquist, Ministry for Foreign Affairs.

By a judgment of 18 May 2006 the Handen District Court (tingsrätt) convicted the applicant of a tax offence (skattebrott). He was given a suspended sentence and ordered to perform 50 hours of community service. The District Court found that he had had temporary employment with a company in 2003 and had failed to declare in his tax return the value of various goods that he had received as remuneration. The applicant did not dispute this, but claimed that he had not understood that the remuneration was liable to tax and that, thus, he had had no intention of evading taxes. He maintained that his conduct, in any event, could only be regarded as a tax misdemeanour (skatteförseelse). The court considered, however, that the investigation clearly showed that he had been aware of his tax liability and that his conduct was to be designated as a tax offence. While the court was unable to exactly determine the applicant’s undeclared income, it considered the material in the case to sufficiently support the prosecutor’s claim that taxes could be charged in the amount of at least 40,000 Swedish kronor (SEK; approximately 4,300 euros (EUR).

On 16 November 2006 the Svea Court of Appeal (Svea hovrätt) reclassified the offence as a tax misdemeanour and sentenced the applicant to 75 day fines (dagsböter) of SEK 1,000 (approximately EUR 110) each. The appellate court found that, in distinguishing between a tax offence and a tax misdemeanour, all objective facts were to be considered, although the amount in question was of particular importance. According to domestic case-law, the line had been drawn at about SEK 30,000, and the court could not find beyond reasonable doubt that the total remuneration received by the applicant had exceeded that amount. Nor were there other circumstances that justified the classification of the offence as a tax offence.

The applicant did not appeal against the Court of Appeal’s judgment, which consequently acquired legal force on 15 December 2006.

On 28 August 2006 the Tax Agency (Skatteverket) made an enquiry to the applicant, indicating that it was considering a supplementary tax assessment involving tax surcharges. The applicant replied to this enquiry on 5 September 2006.

By a decision of 22 March 2007 the Tax Agency reviewed the applicant’s taxation for income received in 2003 (i.e. the taxation year 2004) and found that he had failed to account for income received from the company mentioned above. Having regard to the documentation in the case, including the judgments in the criminal case, the Agency found it reasonable to assume that the applicant had received a monthly income of SEK 25,000 during the period of April to November 2003, or in total SEK 200,000. After deductions for estimated costs for travels to and from work and increased living expenses of SEK 24,000, the Agency revised upwards his income by SEK 176,000. Furthermore, as the information supplied by the applicant in his tax return was found to be incorrect and the revision had had to be made under a discretionary assessment procedure, he was ordered to pay tax surcharges (skattetillägg), amounting to 40% of the increased tax liability.

Following the applicant’s appeal, the Tax Agency, on 21 June 2007, made an obligatory review of its decision and lowered the revised income. Instead of SEK 176,000, the applicant’s income was raised by SEK 83,000. The tax surcharges were lowered correspondingly and thereafter amounted to SEK 13,498 (approximately EUR 1,500).

By a judgment of 5 May 2008 the County Administrative Court (länsrätten) in the County of Gävleborg agreed with the Tax Agency’s decision of 21 June 2007. However, the court had regard to the preparatory works (prop. 2002/03:106, p. 244) to the provisions on exemption of tax surcharges (in particular, Chapter 5, section 14 of the Tax Assessment Act; Taxeringslagen, 1990:324), according to which, in determining the surcharges, it could be taken into account that the same reproachable act or omission had also led to the individual’s conviction for a crime under the Tax Offences Act (Skattebrottslagen, 1971:69), the reason being that the total penalty should not be unreasonably heavy. In view of the applicant’s conviction and sentence, the court found reason to halve the tax surcharges in question.

On 6 October 2008 the Administrative Court of Appeal (kammarrätten) in Sundsvall upheld the County Administrative Court’s judgment.

The Tax Agency appealed to the Supreme Administrative Court (Regeringsrätten) which, on 10 March 2009, granted leave to appeal.

On 17 September 2009 the Supreme Administrative Court quashed the lower courts’ judgments and upheld the Tax Agency’s review decision of 21 June 2007 (judgment published in Regeringsrättens årsbok (RÅ) 2009, ref. 94). In assessing whether there was a violation of the prohibition on double punishment under Article 4 of Protocol No. 7 to the Convention, the court referred to the fact that the relevant Swedish provisions aimed at ensuring that the combined sanctions – criminal conviction and imposition of tax surcharges – were in reasonable proportion to the conduct for which the individual had been found liable. It further noted that the Swedish legal system contained the special feature of separate general courts and administrative courts. In the court’s opinion, Article 4 of Protocol No. 7 had to be interpreted in the light of such special features in the national legal systems. While acknowledging that the European Court’s recent judgments in Sergey Zolotukhin v. Russia ([GC], no. 14939/03, judgment of 10 February 2009, ECHR 2009) and Ruotsalainen v. Finland (no. 13079/03, judgment of 16 June 2009) suggested a change in the Strasbourg case-law, the Supreme Administrative Court noted that they did not relate to the Swedish legal system and concluded that this system, allowing for both a conviction for a tax offence and an imposition of tax surcharges, was in conformity with the Convention. The court further found that an exemption from surcharges under Chapter 5, section 14 of the Tax Assessment Act could only be granted if the individual had received a severe fine or prison sentence. As that was not considered to be the case with regard to the applicant and, thus, his total penalty was not unreasonable, there was no ground on which to reduce the surcharges fixed by the Tax Agency.

The rules on taxes and tax surcharges relevant to the present case were primarily laid down in, as far as income tax was concerned, the Tax Assessment Act (Taxeringslagen, 1990:324) and, with respect to VAT, the Tax Payment Act (Skattebetalningslagen, 1997:483). Both laws have since been replaced by the Tax Procedure Act (Skatteförfarandelagen; 2011:1244).

A tax surcharge could – and still can – be imposed on a taxpayer in two situations: if he or she, in a tax return or in any other written statement, has submitted information of relevance to the tax assessment which is found to be incorrect (Chapter 5, section 1 of the Tax Assessment Act, and Chapter 15, section 1 of the Tax Payment Act) or if, following a discretionary assessment, the Tax Agency decides not to rely on the tax return (Chapter 5, section 2, and Chapter 15, section 2, respectively). It is not only express statements that may lead to the imposition of a surcharge; concealment, in whole or in part, of relevant facts may also be regarded as incorrect information. A discretionary tax assessment is made if the taxpayer has submitted information which is so inadequate that the Tax Agency cannot base its tax assessment on it or if he or she has not filed a tax return despite the obligation to do so. In certain circumstances, the tax surcharges may be exempted.

A person who intentionally furnishes incorrect information to an authority or fails to file a tax return or other required information, thereby causing a risk that taxes will be withheld from the public treasury or wrongly credited or repaid to him or her, is criminally liable under sections 2-4 of the Tax Offences Act (Skattebrottslagen, 1971:69). The possible sentence ranges from a fine for a tax misdemeanour (skatteförseelse) to imprisonment for a maximum of six years for an aggravated tax offence. Section 5 provides that a person who is not considered to have furnished incorrect information with intent but to have been grossly negligent in doing so (vårdslös skatteuppgift) may be sentenced to a fine or a maximum of one year in prison. The term “incorrect information” in the Tax Offences Act is considered to have the same meaning as in the above provisions on tax surcharges (Government Bill 2010/11:165, p. 1110).

In a judgment of 29 November 2000 the Supreme Court considered whether a person could be convicted of a tax offence in criminal proceedings following the imposition of a tax surcharge in tax proceedings (published in Nytt juridiskt arkiv (NJA) 2000, p. 622). Having noted that, under internal Swedish law, a surcharge is not considered a criminal penalty and does not prevent trial and conviction for a tax offence relating to the same act, the Supreme Court went on to examine the matter under the Convention. It first considered, in the light of the Court’s case-law, that there were weighty arguments for regarding Article 6 as being applicable under its criminal head to proceedings involving a tax surcharge. Even assuming this to be the case, it held, however, that the principle of ne bis in idem, as set forth in Article 4 of Protocol No. 7 to the Convention presupposed that the initial conviction or acquittal had been delivered in accordance with the penal procedure of the State. Therefore the principle did not prevent criminal proceedings from being brought against someone for an act in respect of which a surcharge had already been levied. This view was confirmed in later judgments delivered by the Supreme Court.

On 17 September 2009, in its judgment concerning the present case, the Supreme Administrative Court examined the reverse situation, that is, where the question of imposition of tax surcharges arose after a criminal conviction for a tax offence. It concluded that the Swedish legal system was in conformity with the Convention (see further paragraph 12 above).

By a decision of 31 March 2010 the Supreme Court examined the issue anew (NJA 2010, p. 168). It found again, by a majority of 3 votes to 2, that there was no reason generally to invalidate the Swedish system with double proceedings by virtue of Article 4 of Protocol No. 7. The court considered that, following Sergey Zolotukhin v. Russia If the later proceedings concerned identical or essentially the same facts as the earlier proceedings, it was a matter of proceedings concerning the same offence. However, the Supreme Court noted that the Strasbourg case-law left some room for several punishments for the same offence that could be decided by separate organs at different times and mentioned by way of example, inter alia, the conviction for a traffic offence and the resultant withdrawal of the offender’s driving licence. The Supreme Court further found that the invalidation of a Swedish system regulated by domestic law with reference to the Convention required that either the Convention itself or the European Court’s jurisprudence provided clear support for that conclusion and considered that neither Article 4 of Protocol No. 7 nor the jurisprudence provided such support in the matter at hand.

By a plenary decision of 11 June 2013 (NJA 2013, p. 502) the Supreme Court overturned its previous conclusions. In line with its 2010 decision, the court held that the imposition of tax surcharges and the conviction for a tax offence based on the same information supplied in a tax return are founded on identical factual circumstances and the relevant proceedings thus concern the same offence within the meaning of Article 4 of Protocol No. 7. However, where the court in 2010 had found that the invalidation of the Swedish system required clear support in the Convention itself or in Strasbourg case-law, the court now noted that the judgment of the European Court of Justice in the case of Åkerberg Fransson (26 February 2013, case no. C-617/10) already prohibited double proceedings and punishments with respect to VAT. As the Swedish system had thereby been partially invalidated, the legal and practical consequences of further changes were not so radical as to require the intervention of the legislature. The court also took into account that no legislative amendments had been made despite the developments in Strasbourg case-law since 2009 and that it would be inexpedient and difficult to apply different rules on similar contraventions within a system meant to be coherent. Consequently, the court held that there was sufficient support for concluding that the Swedish system of tax surcharges and tax offences was incompatible with Article 4 of Protocol No. 7. This conclusion applied not only to VAT, but also to income tax, employer’s contributions and similar payments.

The Supreme Court further found that the protection under Swedish law against double proceedings and punishments was valid also in cases where the state exacted personal liability on an individual for tax surcharges imposed on a legal person. Having regard to the strong and systematic connection in Swedish law between the principles of res judicata and lis pendens, the court also held, although the Court’s jurisprudence was unclear on this point, that ongoing, not finalised proceedings on tax surcharges precluded a criminal indictment concerning the same factual circumstances. The procedural hindrance against an indictment materialised when the Tax Agency took its decision to impose surcharges.

However, whereas the imposition of tax surcharges and the conviction for a tax offence based on the same factual circumstances concerned the same offence and were thus prohibited, the situation was different when the criminal conviction concerned a bookkeeping offence. According to the Supreme Court, which had regard to the case-law of the Court, the concrete factual circumstances forming the basis of a bookkeeping offence could normally not be considered inextricably linked to the factual circumstances leading to the imposition of tax surcharges. In addition to the breach of bookkeeping obligations under the Accountancy Act, the imposition of a tax surcharge involved a further factual element, namely the submission of incorrect information in a tax return.

In the case at hand, which involved the imposition of tax surcharges against an individual in November 2009 and the criminal indictment of him in June 2010 for, inter alia, aggravated tax offences and an aggravated bookkeeping offence, the Supreme Court quashed the appealed judgment of the Court of Appeal in so far as it concerned the tax offence relating to his personal income tax and dismissed the indictment in that respect. However, nothing prevented the examination of the bookkeeping offence or the tax offences concerning VAT and employer’s contributions. In the latter respect, the conclusion was due to the tax surcharges relating to VAT and employer’s contributions having been imposed on the appellant’s limited liability company and not on him personally.

In a further decision, taken on 16 July 2013 (NJA 2013, p. 746), the Supreme Court examined the question whether a former defendant could be granted a re-opening of criminal proceedings (resning) under Chapter 58, section 2 of the Code of Judicial Procedure (Rättegångsbalken) if he or she had been convicted of an offence under the Tax Offences Act in a manner incompatible with Article 4 of Protocol No. 7, as interpreted by the decision of 11 June 2013. The court concluded that, on the basis of the Convention, in particular Article 13, a Swedish court may decide, in certain situations, that a case is to be re-opened notwithstanding the special conditions specified in Chapter 58, section 2. The court also took the position that the incompatibility of Swedish legislation regarding sanctions for tax-related offences with Article 4 of Protocol No. 7 had arisen by virtue of the Sergey Zolotukhin judgment (cited above), thus on 10 February 2009. The Supreme Court’s decision led to criminal proceedings being re-opened in respect of an individual’s conviction for an offence under the Tax Offences Act. As a result, the possibility of being granted a re-opening of criminal proceedings applies retroactively to judgments having been delivered in criminal proceedings as from 10 February 2009.

On 25 July 2013 the Supreme Court took another decision of relevance (NJA 2013, p. 780). It stated therein that, if criminal proceedings have commenced before the Tax Agency has decided to impose tax surcharges, the prohibition against ne bis in idem cannot result in a criminal judgment that has become final being re-opened and quashed. Instead, it is the second set of proceedings to be commenced – the tax proceedings involving surcharges – that are contrary to the law. The violation of the right not to be tried or punished twice for the same offence is therefore in this situation a matter for the administrative courts.

By a plenary judgment of 29 October 2013 (HFD 2013 ref. 71), the Supreme Administrative Court (now Högsta förvaltningsdomstolen) reversed the position taken in its judgment of 17 September 2009 and confirmed in a judgment of 21 December 2010 (RÅ 2010 ref. 117). Agreeing with the conclusions drawn by the Supreme Court, the Supreme Administrative Court found that the same principles should apply when the order of the tax and criminal proceedings is different, that is, when the tax proceedings are commenced later. Accordingly, a criminal indictment constitutes a procedural hindrance against imposing tax surcharges based on the same submission of incorrect information.

In the case at hand, where the individual had been indicted in February 2005 and surcharges had been imposed by the Tax Agency in April 2005, the Supreme Administrative Court concluded that the latter decision violated Article 4 of Protocol No. 7. The appeal made against the appellate court’s judgment on tax surcharges was accordingly granted and the surcharges set aside.

The Supreme Administrative Court has since examined several petitions for the re-opening of tax proceedings in which tax surcharges had been imposed. In a decision of 2 December 2013 (cases nos. 5850-13 and 5851-13) it rejected the petition, stating that the earlier criminal proceedings had not led to an indictment of the individual but to a decision by the prosecutor to discontinue the preliminary investigation and that, accordingly, no violation of the prohibition against double proceedings had occurred. In a judgment of 5 June 2014 (cases nos. 1112-14 and 1113-14) it granted a re-opening, noting that, pursuant to the Supreme Court’s decision of 16 July 2013, the applicant would have had a right of re-opening of the criminal proceedings if the tax surcharge decision had preceded the indictment and finding that the situation at hand, which was the reverse, should not be treated differently. The Supreme Administrative Court accordingly re-opened the tax proceedings and quashed the tax surcharges in question. The latter case had already been examined by the Supreme Administrative Court as part of the original tax proceedings in December 2010 – prior to the recent developments in Swedish case-law – and had then been considered not to involve a breach of Article 4 of Protocol No. 7.

In a judgment of 19 June 2014 (cases nos. 7110-13 and 7111-13) the Supreme Administrative Court examined a different situation where tax surcharges had been imposed on a person by a decision of the Tax Agency in May 2011, upheld by the County Administrative Court in February 2012. During the subsequent examination before the Administrative Court of Appeal, the person in question was, in separate criminal proceedings, indicted for a tax offence but acquitted thereof by a judgment of the District Court in April 2013 which soon afterwards acquired legal force. As a consequence, the Administrative Court of Appeal, in September 2013, quashed the surcharges that had been imposed. The Supreme Administrative Court agreed with this course of action, noting that the Court had established in several judgments (including Nykänen v. Finland, no. 11828/11, 20 May 2014) that, in the event that one of two concurrent sets of proceedings becomes final, Article 4 of Protocol No. 7 required that the other set of proceedings be discontinued. The Supreme Administrative Court’s judgment was delivered in ordinary proceedings which had not involved any re-opening. Furthermore, all the decisions and judgments in the case were delivered after the Sergey Zolotukhin judgment.

Following the above judicial changes, the Prosecutor-General (Riksåklagaren) and the Economic Crime Authority (Ekobrotts-myndigheten) decided to examine all tax cases where there may have been double punishments in accordance with the conclusions by the two supreme courts. Whenever the conditions were met, the prosecutor would file a petition for the criminal proceedings to be re-opened, provided that the individual agreed to this course of action and had not already sought a re-opening him- or herself. The undertaking, expected to be finalised by mid-March 2014, was to cover all cases ending with a judgment, an order of summary punishment (strafföreläggande) or a decision not to prosecute (åtalsunderlåtelse) since 10 February 2009.

On 25 April 2014 the Swedish newspaper Dagens Nyheter, basing itself on information provided by the Economic Crime Authority, reported that close to 3,000 cases concerning tax offences had been examined. Out of more than 110 individuals who were serving prison sentences, 42 had been released. Those who had not been released had been convicted also for other crimes than tax offences. A further number of persons who were about to start serving prison sentences did not have to do so. 800 individuals who had already served their sentences had been asked whether they wished assistance in filing petitions for re-opening of proceedings and, so far, 541 of them had accepted and 128 cases had been re-opened. In some re-opened cases the convictions had been quashed in their entirety; in others, involving several offences, the proceedings had to be repeated.

Section 4 of the Act on Compensation for Deprivation of Liberty and Other Coercive Measures (Lagen om ersättning vid frihetsberövande och andra tvångsåtgärder; 1998:714) stipulates that a person who has served a prison sentence is entitled to compensation if, following an appeal or a re-opening of proceedings, he or she is acquitted or given a less severe sentence or the judgment containing the conviction is quashed. Under section 7 of that Act, compensation is awarded for costs, loss of income, interference in business activities and suffering. Normally, in accordance with the practice of the Chancellor of Justice (Justitiekanslern), compensation for suffering is set at a rate of SEK 30,000 (approximately EUR 3,300) for the first month, SEK 20,000 (EUR 2,200) for each additional month up to and including the sixth month and SEK 15,000 (EUR 1,600) per month after that. Certain circumstances can lead to a higher rate of compensation. This is primarily the case if the suspicions have concerned a particularly serious crime or if the matter has attracted extensive media attention.

An action for damages can also be based on the Tort Liability Act (Skadeståndslagen, 1972:207). Under Chapter 3, section 2 of that Act, compensation is awarded for damage caused by fault or negligence on the part of a public authority. Requests can be lodged with the Chancellor of Justice. If dissatisfied with the Chancellor’s decision, the individual has the option of bringing an action for damages against the State in the general courts. He or she may also institute such proceedings directly without having made a request to the Chancellor.

In addition, the Supreme Court has developed case-law which provides that, in order to provide redress for victims of Convention violations, compensation may be awarded without direct support in Swedish law. Based on this case-law, the Chancellor of Justice has awarded compensation in many cases following requests from individuals. The Court has had regard to this development and has concluded that, following a Supreme Court judgment of 3 December 2009 (NJA 2009 N 70), there is an accessible and effective remedy of general applicability, capable of affording redress in respect of alleged violations of the Convention (see, for example, Eriksson v. Sweden, no. 60437/08, §§ 48-52, 12 April 2012, and Marinkovic v. Sweden (dec.), no. 43570/10, § 43, 10 December 2013, and – in regard to the domestic case-law developments – the latter decision, §§ 21-31).


Violation of Article 6 - Right to a fair trial (Article 6 - Enforcement proceedings;Article 6-1 - Access to court)

The applicant was born in 1938 and lives in Sofia.

The Sofia Municipal Council approved the exchange of a municipal flat for a smaller flat owned and occupied by the applicant in December 2005. However, the mayor of Sofia did not issue the necessary order and did not sign a contract for the exchange, as provided in the applicable rules. The applicant brought judicial review proceedings challenging the mayor’s tacit refusal to act. The Sofia Administrative Court quashed the mayor’s tacit refusal in a judgment of 1 April 2010 and instructed the mayor to issue an order for the exchange of the flats. That part of the judgment became final and enforceable on 19 May 2010.

By a decision of 25 March 2010 the Sofia Municipal Council revoked its December 2005 decision approving the exchange of the two properties. The applicant lodged a challenge against that 25 March 2010 decision. In a final judgment of 7 March 2011 the Supreme Administrative Court declared the Council’s decision of 25 March 2010 null and void.

On 18 April 2011 the mayor issued a decision explicitly refusing to issue an order for the exchange of the two flats. Following an application by the applicant for judicial review, on 30 March 2012 the Supreme Administrative Court declared that decision null and void as having been issued in breach of the judgment of the Sofia Administrative Court of 1 April 2010. The court also instructed the mayor to issue an order for the conclusion of the exchange agreement.

The mayor ordered the flat exchange on 6 March 2013 and the applicant signed a contract for the exchange on 25 June 2013.