Article 47 - Right to an effective remedy and to a fair trial
Article 48 - Presumption of innocence and right of defence
Article 52 - Scope and interpretation
Key facts of the case:
Request for a preliminary ruling from the Corte costituzionale. Reference for a preliminary ruling – Approximation of laws – Directive 2003/6/EC – Article 14(3) – Regulation (EU) No 596/2014 – Article 30(1)(b) – Market abuse – Administrative sanctions of a criminal nature – Failure to cooperate with the competent authorities – Articles 47 and 48 of the Charter of Fundamental Rights of the European Union – Right to remain silent and to avoid self-incrimination.
Outcome of the case:
On those grounds, the Court (Grand Chamber) hereby rules:
Article 14(3) of Directive 2003/6/EC of the European Parliament and of the Council of 28 January 2003 on insider dealing and market manipulation (market abuse) and Article 30(1)(b) of Regulation (EU) No 596/2014 of the European Parliament and of the Council of 16 April 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6 and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC, read in the light of Articles 47 and 48 of the Charter of Fundamental Rights of the European Union, must be interpreted as allowing Member States not to penalise natural persons who, in an investigation carried out in respect of them by the competent authority under that directive or that regulation, refuse to provide that authority with answers that are capable of establishing their liability for an offence that is punishable by administrative sanctions of a criminal nature, or their criminal liability.
1) The reference for a preliminary ruling concerns the interpretation of Articles 47 and 48 of the Charter of Fundamental Rights of the European Union (‘the Charter’) as well as the interpretation and validity of Article 14(3) of Directive 2003/6/EC of the European Parliament and of the Council of 28 January 2003 on insider dealing and market manipulation (market abuse) (OJ 2003 L 96, p. 16), and Article 30(1)(b) of Regulation (EU) No 596/2014 of the European Parliament and of the Council of 16 April 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6 and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC (OJ 2014 L 173, p. 1).
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21) According to the referring court, it is necessary, first, to take into consideration the risk that, as a result of the obligation to cooperate with the competent authority, the suspected perpetrator of an administrative offence liable to be the subject of a penalty of a criminal nature could, as a matter of fact, contribute to the substantiation of a criminal charge against him or her. The referring court notes, in that regard, that, under Italian law, the insider dealing alleged against DB constitutes both an administrative offence and a criminal offence, and that proceedings relating to both may be brought and prosecuted in parallel, in so far as compatible with the ne bis in idem principle enshrined in Article 50 of the Charter (judgment of 20 March 2018, Garlsson Real Estate and Others, C‑537/16, EU:C:2018:193, paragraphs 42 to 63).
23) According to the referring court, since Article 187quindecies of the consolidated text was introduced into the Italian legal system in performance of a specific obligation under Article 14(3) of Directive 2003/6 and now implements Article 30(1)(b) of Regulation No 596/2014, a declaration that Article 187quindecies is unconstitutional would be likely to conflict with EU law, if those provisions of secondary EU legislation were to be understood as requiring Member States to penalise the silence, at a hearing before the competent authority, of a person suspected of insider dealing. In its view, it is questionable whether those provisions, understood in this way, are compatible with Articles 47 and 48 of the Charter, which also seem to recognise the right to silence within the same limits as those resulting from Article 6 of the ECHR and the Italian Constitution.
25) That case-law, which was established in relation to legal persons and not natural persons, and to a large extent before the adoption of the Charter, seems difficult to reconcile with the criminal nature, acknowledged by the Court of Justice in the judgment of 20 March 2018, Di Puma and Zecca (C‑596/16 and C‑597/16, EU:C:2018:192), of the administrative sanctions laid down in the Italian legal system in respect of insider dealing.
26) Since the question of whether Articles 47 and 48 of the Charter require, in the light of the case-law of the European Court of Human Rights concerning Article 6 of the ECHR, compliance with the right to silence in administrative proceedings which may lead to the imposition of a penalty of a criminal nature has not yet been addressed by the Court or by the EU legislature, the referring court considers it necessary, before it rules on the question of constitutionality that has been submitted to it, to refer the matter to the Court for interpretation and, as the case may be, an assessment of the validity, in view of Articles 47 and 48 of the Charter, of Article 14(3) of Directive 2003/6 and Article 30(1)(b) of Regulation No 596/2014.
27) In those circumstances, the Corte costituzionale (Constitutional Court) decided to stay the proceedings and to refer the following questions to the Court for a preliminary ruling:
34) By its questions, which it is appropriate to examine together, the referring court asks, in essence, whether Article 14(3) of Directive 2003/6 and Article 30(1)(b) of Regulation No 596/2014, read in the light of Articles 47 and 48 of the Charter, must be interpreted as allowing Member States not to penalise natural persons who, in the context of an investigation carried out in respect of them by the competent authority under that directive or that regulation, refuse to provide that authority with answers that are capable of establishing their liability for an offence that is punishable by administrative sanctions of a criminal nature.
35) In that regard, it should be recalled, as a preliminary point, that, according to Article 51(1) of the Charter, the provisions of the Charter are addressed to the EU institutions and to the Member States when they are implementing EU law.
36) Furthermore, while the questions referred mention Articles 47 and 48 of the Charter, which enshrine, inter alia, the right to a fair trial and the presumption of innocence, the request for a preliminary ruling also refers to the rights guaranteed in Article 6 of the ECHR. Whilst the ECHR does not constitute, for as long as the European Union has not acceded to it, a legal instrument which has been formally incorporated into the EU legal order, it must nevertheless be recalled that, as Article 6(3) TEU confirms, fundamental rights recognised by the ECHR constitute general principles of EU law. Furthermore, Article 52(3) of the Charter, which provides that the rights contained in the Charter which correspond to rights guaranteed by the ECHR are to have the same meaning and scope as those laid down by the ECHR, is intended to ensure the necessary consistency between those respective rights without adversely affecting the autonomy of EU law and that of the Court of Justice (see, to that effect, judgment of 20 March 2018, Garlsson Real Estate and Others, C‑537/16, EU:C:2018:193, paragraphs 24 and 25).
37) According to the Explanations relating to the Charter of Fundamental Rights (OJ 2007 C 303, p. 17), the second paragraph of Article 47 of the Charter corresponds to Article 6(1) of the ECHR and Article 48 of the Charter is ‘the same’ as Article 6(2) and (3) of the ECHR. When interpreting the rights guaranteed by the second paragraph of Article 47 and of Article 48 of the Charter, the Court must, therefore, take account of the corresponding rights guaranteed by Article 6 of the ECHR, as interpreted by the European Court of Human Rights, as the minimum threshold of protection (see, to that effect, judgments of 21 May 2019, Commission v Hungary (Usufruct over agricultural land), C‑235/17, EU:C:2019:432, paragraph 72; of 6 October 2020, La Quadrature du Net and Others, C‑511/18, C‑512/18 and C‑520/18, EU:C:2020:791, paragraph 124; and of 17 December 2020, Centraal Israëlitisch Consistorie van België and Others, C‑336/19, EU:C:2020:1031, paragraph 56).
45) In the light of the considerations set out in paragraphs 35 to 44 above, it must be held that the safeguards afforded by the second paragraph of Article 47 and Article 48 of the Charter, with which EU institutions as well as Member States must comply when they implement EU law, include, inter alia, the right to silence of natural persons who are ‘charged’ within the meaning of the second of those provisions. That right precludes, inter alia, penalties being imposed on such persons for refusing to provide the competent authority under Directive 2003/6 or Regulation No 596/2014 with answers which might establish their liability for an offence that is punishable by administrative sanctions of a criminal nature, or their criminal liability.
49) In the light of the doubts expressed by the referring court as to the validity, in the light of the right to silence enshrined in the second paragraph of Article 47 and in Article 48 of the Charter, of Article 14(3) of Directive 2003/6 and of Article 30(1)(b) of Regulation No 596/2014, it is necessary further to ascertain whether those provisions of secondary EU legislation lend themselves to an interpretation which is consistent with that right to silence, in that they do not require penalties to be imposed on natural persons for refusing to provide the competent authority under that directive or that regulation with answers which might establish their liability for an offence that is punishable by administrative sanctions of a criminal nature, or their criminal liability.
50) In that regard, it should be noted at the outset that, in accordance with a general principle of interpretation, the wording of secondary EU legislation must be interpreted, as far as possible, in such a way as not to affect its validity and in conformity with primary law as a whole and, in particular, with the provisions of the Charter. Thus, if such wording is open to more than one interpretation, preference should be given to the interpretation which renders the provision consistent with primary law rather than to the interpretation which leads to its being incompatible with primary law (judgment of 14 May 2019, M and Others (Revocation of refugee status), C‑391/16, C‑77/17 and C‑78/17, EU:C:2019:403, paragraph 77). Both recital 44 of Directive 2003/6 and recital 77 of Regulation No 596/2014 emphasise, moreover, that those two acts respect the fundamental rights and observe the principles recognised in the Charter.
55) It follows that both Article 14(3) of Directive 2003/6 and Article 30(1)(b) of Regulation No 596/2014 lend themselves to an interpretation which is consistent with Articles 47 and 48 of the Charter, in that they do not require penalties to be imposed on natural persons for refusing to provide the competent authority with answers which might establish their liability for an offence that is punishable by administrative sanctions of a criminal nature, or their criminal liability.
56) Interpreted in this way, the validity of those provisions of secondary EU legislation cannot be undermined, having regard to Articles 47 and 48 of the Charter, on the ground that they do not explicitly rule out the imposition of a penalty for such a refusal.
57) Finally, it must be borne in mind, in that context, that Member States must use the discretion afforded to them by an instrument of secondary EU legislation in a manner that is consistent with fundamental rights (see, to that effect, judgment of 13 March 2019, E., C‑635/17, EU:C:2019:192, paragraphs 53 and 54). In the context of the implementation of obligations stemming from Directive 2003/6 or Regulation No 596/2014, it is therefore for them to ensure, as has been pointed out in paragraph 45 above, that, in accordance with the right to silence guaranteed by Articles 47 and 48 of the Charter, the competent authority cannot impose penalties on natural persons for refusing to provide that authority with answers which might establish their liability for an offence that is punishable by administrative sanctions of a criminal nature, or their criminal liability.
58) In the light of all of the foregoing, the answer to the questions referred is that Article 14(3) of Directive 2003/6 and Article 30(1)(b) of Regulation No 596/2014, read in the light of Articles 47 and 48 of the Charter, must be interpreted as allowing Member States not to penalise natural persons who, in an investigation carried out in respect of them by the competent authority under that directive or that regulation, refuse to provide that authority with answers that are capable of establishing their liability for an offence that is punishable by administrative sanctions of a criminal nature, or their criminal liability.