Article 50 - Right not to be tried or punished twice in criminal proceedings for the same criminal offence
Article 51 - Field of application
Article 52 - Scope and interpretation
Key facts of the case:
Reference for a preliminary ruling — Value added tax (VAT) — Directive 2006/112/EC — Failure to pay VAT due — Penalties — National legislation which provides for an administrative penalty and a criminal penalty for the same acts — Charter of Fundamental Rights of the European Union — Article 50 — Ne bis in idem principle — Criminal nature of the administrative penalty — Existence of the same offence — Article 52(1) — Limitations to the ne bis in idem principle — Conditions.
Outcome of the case:
In the light of the foregoing considerations, I propose that the Court reply as follows to the question referred for a preliminary ruling by the Tribunale di Bergamo (District Court, Bergamo, Italy):
Article 50 of the Charter of Fundamental Rights of the European Union:
30) However, the Court of Justice imposed a limit on the imposition of both tax and criminal penalties: ‘if the tax penalty is criminal in nature for the purposes of Article 50 of the Charter and has become final … that provision precludes criminal proceedings in respect of the same acts from being brought against the same person’. Therefore, it is possible to impose tax and criminal penalties concurrently but not to impose a nominally administrative penalty which is really of a criminal nature in addition to another criminal penalty. ( 18 )
31) As I have already observed, in order to establish, for its part, whether a tax penalty is criminal in nature, the Court used the ‘Engel criteria’ which it had previously adopted in Bonda. ( 19 ) However, rather than apply those criteria itself to a law like the Swedish law, the Court entrusted the referring court with the task, ( 20 ) warning that it would only be able to find that the imposition of both tax and criminal penalties was contrary to Article 50 of the Charter if the remaining penalties were effective, proportionate and dissuasive. ( 21 )
34) In short, in Bonda ( 24 ) and Åkerberg Fransson, the Court interpreted Article 50 of the Charter in line ( 25 ) with the hitherto dominant case-law of the ECtHR on the principle ne bis idem. ( 26 ) That common approach was logical, in view of the similarity between the provisions governing the principle ne bis in idem in Article 4 of Protocol No 7 and those in Article 50 of the Charter. ( 27 )
57) In accordance with Article 52(3) of the Charter, the meaning and scope of Article 50 of the Charter is to be ‘the same as those laid down by’ the associated provision of the ECHR. The right protected by Article 50 of the Charter should not be separated, as far as its interpretation is concerned, from Article 4 of Protocol No 7, while the absence of ratification and the reservations and declarations of certain States ( 60 ) in relation to that protocol have no relevance to the Court of Justice.
58) That is the approach implicitly taken in the Åkerberg Fransson judgment, in which it was not accepted that the level of ratification of a protocol to the ECHR should have a bearing on its use as a criterion for interpreting Article 50 of the Charter, notwithstanding the precautions stipulated in that regard. ( 61 )
59) The explanatory note on Article 52(3) of the Charter states that ‘[t]he reference to the ECHR covers both the Convention and the Protocols to it.’ It makes no distinction based on whether or not those protocols are binding on all the Member States of the EU. ( 62 ) Moreover, such a distinction could lead to a non-uniform interpretation and application of the Charter, ( 63 ) depending on whether or not the State concerned is bound by a protocol annexed to the ECHR.
61) In those circumstances, I believe that the Court of Justice may choose one of the two following approaches: –
62) Leaving aside those two options in the light of the judgment in A and B v. Norway, the Court may, of course, develop specific case-law for determining whether so-called ‘combined (administrative and criminal) proceedings which are sufficiently closely connected’ are compatible with Article 50 of the Charter.
63) This solution is, of course, consistent with the duty to carry out a harmonised interpretation of the provisions of the Charter and the provisions of the ECHR (and the protocols thereto), in accordance with Article 52(3) of the Charter.
64) A number of Governments which have intervened in the proceedings argue in favour of such an alignment, relying, moreover, on the rules of interpretation of the Charter, laid down in Article 52(4) and (6) thereof. The first rule states that ‘[i]n so far as this Charter recognises fundamental rights as they result from the constitutional traditions common to the Member States, those rights shall be interpreted in harmony with those traditions.’ In accordance with the second rule, ‘[f]ull account shall be taken of national laws and practices as specified in this Charter.’
65) Those governments observe that national laws and practices vary widely with regard to the possibility of imposing both criminal and administrative penalties for the same acts. In the light of that heterogeneous reality, they advocate a restrictive interpretation of Article 50 of the Charter, which guarantees States an appropriate power to impose punishment, as the ECtHR did in its judgment in A and B v. Norway.
66) I disagree with those arguments. The rule for interpretation in Article 52(6) is not applicable to Article 50 of the Charter, since, as the Commission has stated, that provision does not include any reference to national laws and practices (unlike others, such as Articles 16, 27, 28, 30, 34, 35 and 36 of the Charter).
67) Nor is the rule in Article 52(4) relevant for the purposes of determining the scope of Article 50 of the Charter. First, the Governments concerned agree that there are no common constitutional traditions concerning the subject-matter of that right. ( 65 ) Secondly, the traditions of those States which restrict the effectiveness of the principle ne bis in idem exclusively to criminal law would lead to an interpretation of Article 50 which is even more restrictive than that of the ECtHR in relation to Article 4 of Protocol No 7.
68) That outcome is incompatible with Article 52(3) of the Charter, with the result that the common constitutional traditions, should they exist in this area, may only operate as a criterion for interpretation of Article 50 of the Charter if they lead to a higher level of protection of the right. ( 66 )
72) I repeat that I do not believe that the Court of Justice should follow the ECtHR down that route. The interpretation of Article 50 of the Charter cannot depend on the degree of willingness of States to comply with its legally binding provisions. And since the case-law of the Court has consolidated a statement of the law to the effect that two parallel or consecutive sets of proceedings, which lead to two substantively criminal penalties in respect of the same acts, continue to be two sets of proceedings (bis) and not one, I can find no sound reasons for abandoning it.
73) Further, the introduction into EU law of a criterion for interpretation of Article 50 of the Charter which rests on the degree of the substantive and temporal connection between one type of proceedings (criminal proceedings) and another (administrative proceedings in which a penalty is imposed) would add significant uncertainty and complexity to the right of individuals not to be tried or punished twice for the same acts. The fundamental rights recognised in the Charter must be easily understood by all and the exercise of those rights calls for a foreseeability and certainty which, in my view, are not compatible with that criterion.
74) The Court has reiterated that whilst Article 52(3) of the Charter requires rights contained in the Charter which correspond to rights guaranteed by the ECHR to be given the same meaning and scope as those laid down by the ECHR, the latter does not constitute, as long as the European Union has not acceded to it, a legal instrument which has been formally incorporated into EU law. ( 71 )
75) That case-law emphasises the autonomy of the Court of Justice when it interprets the provisions of the Charter, which are the sole provisions applicable in the context of EU law. Therefore, the case-law of the ECtHR should be disregarded where, in the case of rights laid down in the Charter which are similar in content to those laid down in the ECHR and the protocols thereto, the interpretation of the Court of Justice establishes a higher level of protection, provided that this is not detrimental to another right guaranteed by the Charter. ( 72 )
76) When it exercises that autonomy, the Court may carry out its own interpretation of Article 50 of the Charter, which respects the status quo and differs from the line of case-law represented by the judgment in A and B v. Norway. It is sufficient to ensure that that interpretation does not disregard, ( 73 ) and exceeds, the level of protection guaranteed by Article 4 of Protocol No 7, as construed by the ECtHR.
77) Since the judgment in A and B v. Norway limits the guarantees for individuals derived from that provision, by permitting the duplication of proceedings, punishments and administrative penalties of a substantively criminal nature, in the circumstances indicated above, the Court will ensure a higher level of protection, in the context of Article 50 of the Charter, by maintaining without reservations its previous case-law in line with its judgment in Åkerberg Fransson.
78) Article 50 of the Charter, like Article 4 of Protocol No 7, enshrines the principle ne bis in idem as a fundamental right of individuals, which is not subject to exceptions. There is, on occasions, a failure to take proper account of that quality and that fundamental right is subordinated to financial considerations (the situation of the public finances, for example) which, while perfectly legitimate in other areas, are not sufficient to justify limitation of the right. ( 74 )
79) In Spasic, ( 75 ) the Court accepted certain limitations of the protection of the principle ne bis in idem in the context of Article 50 of the Charter. In particular, the Court held that Article 54 of the Convention implementing the Schengen Agreement (which makes the application of that principle subject to the condition that, upon conviction and sentencing, the penalty imposed ‘has been enforced’, is ‘actually in the process of being enforced’ or can no longer be enforced), is compatible with Article 50 of the Charter.
80) In the same vein, can the joint imposition of criminal penalties and tax penalties of a substantively criminal nature in respect of the same acts be permitted in the case of parallel proceedings? In accordance with the horizontal clause in the first sentence of Article 52(1) of the Charter, any limitation on the exercise of the right of ne bis in idem must be provided for by law and respect the essence of that right. In accordance with the second sentence of Article 52(1), subject to the principle of proportionality, limitations may be made to the right of ne bis in idem only if they are necessary and genuinely meet objectives of general interest recognised by the Union or the need to protect the rights and freedoms of others. ( 76 )
82) However, I doubt whether, in these circumstances, there is respect for the essence of the right not to be tried or punished twice in criminal proceedings for the same criminal offence. At all events — and this is the key factor — I believe that the limitation I am now examining is unnecessary, for the purposes of Article 52(1) of the Charter.
83) To my mind, the fact that the legislation of the Member States provides for different solutions in this regard itself demonstrates that that limitation is unnecessary. If the limitation were really necessary, in accordance with Article 52(1) of the Charter, it would be necessary for all and not only some of the Member States.
87) In single-track systems, there is compliance with the principle ne bis in idem laid down in Article 50 of the Charter and the taxable person has a guarantee that he will not be tried or punished twice in criminal proceedings for the same criminal offence. The certainty that, ultimately, the most serious types of fraud will be combated effectively using criminal penalties, which may include imprisonment of the offender, endows these systems with the necessary deterrent force required for the protection of the EU’s financial interests. In my view, the same does not occur in twin-track systems.
90) If, on the other hand, the substantively criminal nature of those penalties is retained, as I believe is appropriate, the guarantee in Article 50 of the Charter should be safeguarded in full where the same act is contrary to both tax provisions which entail a substantively criminal response, and to criminal provisions in the strict sense (that is, provisions which create offences).
94) In short, I propose that the Court should carry out an interpretation of Article 50 of the Charter which progresses along the lines of its previous case-law but which does not limit the content of that right in terms of the judgment in A and B v. Norway or pursuant to Article 52(1) of the Charter.
97) However, I believe that, against the background of the differences of opinion between Italian courts ( 81 ) regarding the effects of the Åkerberg Fransson judgment and the case-law of the ECtHR in this area, particularly after the change in the case-law in the judgment in A and B v. Norway, the Court should provide some additional steps which will facilitate the application by national courts of Article 50 of the Charter.
99) As regards the concept of idem — that is, the same acts — in the case-law of the Court (in particular, the case-law concerning Article 54 of the Schengen Convention) and in the case-law of the ECtHR following the judgment in Zolotukhin v. Russia, ( 83 ) there are sufficient criteria which can be extrapolated to the application of Article 50 of the Charter where both tax penalties and criminal penalties are imposed for non-payment of VAT.
104) More difficulties are raised by the assertion of the Italian Government, which relies for support on the case-law of the Corte di cassazione (Supreme Court of Cassation), according to which the acts are not identical where the administrative offences punish failure to make periodic payments of VAT each month or quarter, after it falls due, while the criminal offence punishes non-payment (in an amount exceeding EUR 50000 or EUR 250000, depending on the applicable law at the time) in relation to a one-year period. In short, that court takes the view that the identity required is not present in those situations, ( 88 ) and also states that the principle ne bis in idem only concerns criminal proceedings and, therefore, cannot be applied to the joint imposition of criminal penalties and tax penalties, meaning that the Italian legislation is not contrary to Article 50 of the Charter or Article 4 of Protocol No 7.
109) As I have observed, in accordance with the Åkerberg Fransson judgment, Article 50 of the Charter:
119) The third Engel criterion concerns the nature and degree of severity of the penalty. Drawing inspiration from the case-law of the ECtHR, which must be applied to the interpretation of Article 50 of the Charter, the national courts should bear in mind, as the ECtHR has reiterated, that the fact that a pecuniary penalty imposed in administrative proceedings for non-payment of taxes is minor in amount does not preclude it from being of a criminal nature. ( 104 ) Indeed, the order for reference states that the tax penalty provided for in Article 13 of Legislative Decree No 471 of 18 December 1997 (30% of the amount of unpaid VAT) is, by its nature and size, of a criminal nature, without this precluding other penalties from increasing that percentage to 100% or more. ( 105 ) ...
121) Since I have ruled out acceptance of the limitation in Article 52(1) of the Charter in relation to application of the principle ne bis in idem to cases of tax fraud governed by EU law (Spasic), ( 106 ) I could finish at this juncture.
122) However, should the Court decide to explore that approach, it is my view, in the alternative, that it is not possible to apply that limitation to this case. The limitation is not necessary, within the meaning of Article 52(1) of the Charter, and nor does the duplication of proceedings and penalties provided for in national law pass the proportionality test for it to be covered by that provision.
124) In the further alternative, should the Court decide to follow the approach established by the judgment in A and B v. Norway for interpreting Article 50 of the Charter, I believe that a situation like that of Mr Menci is not compatible with the statement of the law in that judgment.