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Czech Republic / The Supreme Court of the Czech Republic / 5 Tdo 464/2012

R.K.v The State

Policy area:
Fight against fraud
Deciding Body type:
National Court/Tribunal
Deciding Body:
The Supreme Court
Decision date:

Key facts of the case:

R.K., an owner and a sole shareholder, agreed to reconstruct a house for the elderly. The reconstruction works were subsidized by ESF grants executed by the Ministry of Social Affairs. Consequently, he submitted various invoices on reconstruction works, while together with the director of the house for the elderly, he was aware that such reconstruction was not being fulfilled. By doing so, he caused a monetary damage to the Czech Republic of at least 39.393.135 CZK . R.K. was found guilty in 2009 by the Regional Court in Prague of the crime of fraud (§250 of the Penal Code). The decision was later dismissed and upon a new trial he was found guilty of the crime of subsidy fraud (§ 212 of Penal Code) by the Higher Court in Prague. He appealed against the ruling to the Supreme Court of the Czech Republic basically claiming that the case is not of a criminal matter but rather was a private dispute over an agreement between the builder and the owner of the building. Therefore, only civil procedure should have been applicable. The defendant claimed that that there is a communitarian dimension of the criminal case. He suggested to put the criminal proceedings on hold and to submit a preliminary question to the European Court of Justice, inquiring whether Article 16, 47 and 48 of the Charter of Fundamental Rights of the European Union must be interpreted as precluding legislation, which prevents criminalization of purely private and business matters and private disputes over business contracts.