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S. v. SWEDEN

Doc ref: 11464/85 • ECHR ID: 001-383

Document date: May 12, 1987

  • Inbound citations: 0
  • Cited paragraphs: 0
  • Outbound citations: 0

S. v. SWEDEN

Doc ref: 11464/85 • ECHR ID: 001-383

Document date: May 12, 1987

Cited paragraphs only



                  AS TO THE ADMISSIBILITY OF

                  Application No. 11464/85

                  by M.S.

                  against Sweden

        The European Commission of Human Rights sitting in private

on 12 May 1987, the following members being present:

              MM. C. A. NØRGAARD, President

                  J. A. FROWEIN

                  M. A. TRIANTAFYLLIDES

                  G. JÖRUNDSSON

                  S. TRECHSEL

                  B. KIERNAN

                  A. S. GÖZÜBÜYÜK

                  A. WEITZEL

                  J. C. SOYER

                  H. G. SCHERMERS

                  H. DANELIUS

                  G. BATLINER

                  H. VANDENBERGHE

             Mrs.  G. H. THUNE

             Sir  Basil HALL

             Mr.  F. MARTINEZ

              Mr.  H. C. KRÜGER Secretary to the Commission

        Having regard to Article 25 of the Convention for the

Protection of Human Rights and Fundamental Freedoms;

        Having regard to the application introduced on 21 February 1985

by M.S. against Sweden and registered on 22 March 1985

under file N° 11464/85;

        Having regard to the report provided for in Rule 40 of the

Rules of Procedure of the Commission;

        Having regard to the observations submitted by the respondent

Government on 29 January 1986 and the observations in reply submitted

by the applicant on 24 April 1986 as well as the submissions of the

parties at the hearing held on 12 May 1987;

        Having deliberated;

        Decides as follows:

THE FACTS

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

summarised as follows.

        The applicant is a Swedish citizen, born in 1929 and resident

in Rome.  He is represented before the Commission by Mr.  Carl Göran

Risberg, a lawyer practising in Stockholm.

A.      The particular circumstances of the case

        On 4 December 1973 the applicant received a letter from the

National Tax Board (riksskatteverket) requesting him to explain why an

aggregate amount of 611,827 Swedish crowns (SEK) paid to a certain

company had not been reported by the applicant in his annual tax

returns for the income years 1969, 1970 and 1972 (which is equal to

the "taxation years" 1970, 1971 and 1973).

        The applicant replied that he was not the owner of the

company in question, that he was a salaried employee of that company in

its function as his manager according to a long term contract in

compliance with long established practice in the show business and

that the salary he had received from the company had been properly

declared in his annual tax declarations.

        On 30 April 1975 the Regional Tax Court (länsskatterätten) of

Stockholm decided to impose on the applicant additional taxation

(eftertaxering) in the amount of 206,950 SEK for the taxation year 1970,

157,769 SEK for 1971 and 247,108 SEK for 1973.  The amounts had been

paid by the companies Swedish Film Industry (Svensk Filmindustri) and

SF Production AB to the company in question.  The Regional Tax Court

considered that the amounts were taxable income for the applicant.

        On 23 April 1979 the Administrative Court of Appeal

(kammarrätten) of Stockholm confirmed the decision of the Regional Tax

Court, and on 8 October 1980 the Supreme Administrative Court

(regeringsrätten) refused to grant leave to appeal.

        On 16 November 1978 the Regional Tax Court of Stockholm

decided to impose additional taxation on the applicant in the amount

of 156,352 SEK for the taxation year 1974, 175,976 SEK for 1975 and

14,019 SEK for 1976 for reasons similar to those referred to above in

the decision of 30 April 1975, namely that the amounts in question

were taxable income for the applicant, notwithstanding the contract

between him and the company in its function as his manager.  In

addition to imposing additional taxation, the Regional Tax Court

imposed a special charge (tax supplement) (särskild avgift

(skattetillägg)) which amounted to 50 % of the tax imposed as a result

of the additional taxation.  The total amount of the special charge

(tax supplement) for the three years amounted to 120,399 SEK.   The

proceedings before the Regional Tax Court were conducted entirely in

writing, no oral hearing having been required by the applicant.

        The applicant appealed to the Administrative Court of Appeal

of Stockholm.  In his written submissions to the Court the applicant

explained the factual circumstances concerning his income and set out

his arguments as to whether or not an additional taxation should be

imposed.  Likewise he argued that the circumstances in his case did

not allow for the imposition of the special charge (tax supplement).

Finally the applicant requested that an oral hearing be held before the

Court.  He did not, however, specify any reasons for this request.

        In a decision of 24 November 1981 the Administrative Court of

Appeal rejected the request for an oral hearing.  In the decision the

Court stated as follows:

        " ... (The applicant) has not previously requested a hearing

        before the Regional Tax Court or the Administrative Court of

        Appeal, neither in the cases relating to the taxation years 1970,

        1971 and 1973 nor in the present case.  Moreover, (the

        applicant) has not alleged that the facts as submitted in

        the case are incomplete.

        The Administrative Court of Appeal attaches particular

        importance to the fact that the question whether (the

        applicant) is liable to pay tax on the amounts transmitted

        to the company ... has been dealt with in a particularly

        thorough manner in the previous as well as the present

        case.  The Administrative Court of Appeal finds that

        an oral hearing is unnecessary and that there are special

        reasons militating against it."

        No separate appeal lay against the decision of the

Administrative Court of Appeal in this respect.

        On 15 February 1982 the Administrative Court of Appeal

confirmed the decision of the Regional Tax Court of 16 November 1978.

In its judgment the Court stated, as regards the special charge (tax

supplement):

        "Furthermore the Court finds that the Regional Tax

Court had good reasons to impose the special charge (tax

supplement) on the applicant.  Such reasons or circumstances

as could warrant the remission of this special charge

(tax supplement) are not at hand."

         On 22 April 1982 the applicant asked for leave to appeal

against this decision to the Supreme Administrative Court (regerings-

rätten).  He maintained that he was not liable to pay any additional

tax and furthermore he argued that the refusal to hold an oral hearing

was a procedural error.  He requested that the case be referred back

to the Administrative Court of Appeal where an oral hearing should

take place so that oral evidence could be produced.  The applicant

also asked for an oral hearing before the Supreme Administrative

Court.  The applicant developed his arguments further in his

submissions dated 23 June and 6 July 1982 in which he also referred to

Article 6 of the Convention in respect of the Administrative Court of

Appeal's refusal to hold an oral hearing.

        On 31 August 1984 the Supreme Administrative Court decided not

to grant leave to appeal.

B.      Relevant domestic law and practice

        The procedural network governing the levying of income taxes

is compiled in the 1956 Act on Taxation (taxeringslag 1956:623).  This

Act governs the procedure by which the tax authorities assess the

taxable income, and it also contains provisions regarding the

obligations of the taxpayer with respect to this procedure as well as

certain sanctions which may be imposed upon him in case he fails to

fulfil these obligations.

        Sections 22-36 of the Act contain provisions concerning the

obligation of the taxpayer to submit to the tax authorities

information for the purpose of guiding them in their assessment of his

taxable income.  The income tax return, submitted by the taxpayer, is

subsequently reviewed by a Local Tax Assessment Board (lokal

taxeringsnämnd) for the purpose of assessment.

        Under Section 114 of the Act, an additional assessment

(eftertaxering) may be made in case the taxpayer has made an incorrect

statement on a matter relevant to the assessment of his taxable

income.  An additional assessment must not be made by the Local Tax

Assessment Board, but by an administrative court of first instance

(länsrätt or previously länsskatterätt) upon the application by a Tax

Superintendent (taxeringsintendent) or, as regards municipal income

taxes as opposed to state income tax, the local municipality.  The

decision on such an application is taken only upon the completion of

proceedings before the court in which the taxpayer is given the

opportunity to argue his case on an equal footing with the Tax

Superintendent or the municipality.

        Sections 116 a - 116 t of the Act provide for various

administrative sanctions in the form of "special charges" that may be

imposed upon the taxpayer in case he fails to file his return or files

it later than provided for, and in case he makes incorrect statements

on a matter relevant to the assessment of his taxable income.

        Section 116 a provides inter alia that a special charge (tax

supplement) shall be imposed on a taxpayer if he, in the fulfilment of

his obligation to submit information required for the assessment, has

made a statement that is found to be incorrect.  The tax supplement

amounts to 40 percent - at the time it was imposed on the applicant 50

percent - of that part of his income taxes that would not have been

imposed in case the taxes had been determined on the basis of the

incorrect statement.  Under Section 116 h, the taxpayer may be

relieved from the special charge if his submission of the incorrect

statement is due to circumstances such as his age, illness or lack of

experience or any comparable reason which could make his act or

omission excusable.  The taxpayer may also, under the same section, be

relieved on the ground that his failure is found to be excusable in

view of circumstances related to the incorrect statement as such.

        The question whether a special charge (tax supplement) should

be imposed on a taxpayer is normally determined by a Local Tax Office

(lokal skattemyndighet).  However, in case the question of the special

charge (tax supplement) is raised as a result of an additional

assessment, the question cannot be decided by the Local Tax Office,

but has to be brought before an administrative court of first instance

by a Tax Superintendent.  This claim has to be brought simultaneously

with the claim for additional assessment.  The decision of the court

is taken only upon the completion of proceedings in which the taxpayer

is given the opportunity to argue his case on an equal footing with

the Tax Superintendent.

        The failure of a taxpayer to abide by the stipulations set

forth in the Act for the purpose of aiding the tax authorities in

correctly determining his income taxes, may also subject him to a

criminal charge.  Provisions to this effect are laid down in Sections

119 - 121 of the Act and also in the 1971 Act on Tax Offences

(skattebrottslag 1971:69).  A charge under these provisions is brought

in accordance with the rules governing criminal charges in general.

        A decision taken by an administrative court of first instance

regarding an additional assessment or the imposition of a special

charge (tax supplement) may be appealed to an Administrative Court of

Appeal (kammarrätt).  Subject to certain statutory restrictions, a

judgment of the Court of Appeal may ultimately be brought before the

Supreme Administrative Court (regeringsrätten).

        The procedural rules for these administrative courts appear in

the 1971 Act on Administrative Court Procedure (förvaltningsprocesslag

1971:291).  As a general rule, laid down in Section 9, first paragraph

of the Act, the proceedings should be in writing.  However, according

to the second paragraph of the same section, an oral hearing may be

held regarding a particular issue if this would be advantageous to the

examination or further a speedy determination of the case.  Moreover,

under the third paragraph of the same section, such a hearing shall be

held in the court of first instance and the Court of Appeal when

requested by a private party, provided that the hearing is not

unnecessary and that there are no particular reasons against holding

an oral hearing.

COMPLAINTS

        The applicant complains that a "tax penalty" amounting to

120,399 SEK has been imposed upon him without a fair and public

hearing as guaranteed by Article 6 of the Convention.

        The applicant also complains of a violation of Article 13 of

the Convention in that he had no separate effective remedy against the

refusal of the Administrative Court of Appeal to have an oral hearing,

or against that Court's judgment of 15 February 1982.

        In his letter of 27 November 1985 the applicant finally

complains that, insofar as the "tax penalty" concerns the determination

of a criminal charge, Article 6 para. 2 has been violated since the

"accused" has to prove his innocence or particular circumstances in

order to avoid the penalty.

PROCEEDINGS BEFORE THE COMMISSION

        The application was introduced on 21 February 1985 and

registered on 22 March 1985.

        After a preliminary examination by the Rapporteur, the

Commission decided on 9 October 1985 to bring the application to the

notice of the respondent Government and invite them to submit written

observations on its admissibility and merits.

        After an extension of the time-limit the Government's

observations were submitted on 29 January 1986.

        After an extension of the time-limit the applicant's

observations in reply were submitted on 24 April 1986.

        On 16 October 1986 the Commission decided to invite the

parties to appear before it at a hearing on the admissibility and

merits of the application.

        At the hearing, which was held on 12 May 1987, the parties

were represented as follows:

The Government

Mr.  Hans Corell         Ministry of Foreign Affairs, agent

Mrs.  Lena Moore         Ministry of Justice, adviser

Mr.  Håkan Berglin       Ministry of Foreign Affairs, adviser

Mr.  Nils Dexe           Ministry of Finance, adviser

The applicant

Mr.  Carl G. Risberg     Counsel for the applicant

Prof.  Lars Hjerner      adviser

Miss Ulrika Sundberg    adviser

SUBMISSIONS OF THE PARTIES

The Government

        The Government contend that the present case does not involve

the applicant's civil rights and obligations.  The proceedings

complained of concerned the imposition of taxes and tax supplements.

Even though the concept of civil rights and obligations has to be

viewed as an autonomous concept which must be interpreted

independently of the distinction in Swedish law between civil and

public law, there would appear to be no doubt that, as regards

proceedings concerning taxes as such, the public law character of the

obligation is so predominant as to exclude the application of

Article 6.

        An issue is whether the tax supplement imposed on the

applicant should be considered as a form of tax or, if not, whether

the reasons for holding that Article 6 is not applicable to

proceedings concerning the imposition of taxes are equally relevant to

proceedings concerning the tax supplement.  At least the latter

question has to be answered in the affirmative.  Thus, the most

significant prerequisite for imposing the tax supplement is that the

taxpayer is found liable for the taxes at issue.  Furthermore, the

size of the tax supplement is directly related to the outcome of the

tax issue as such.  Consequently, as to these two questions, once the

tax issue as such is determined, no further considerations need to be

made as regards the tax supplement.  The additional prerequisite that

needs to be present before a tax supplement could be imposed, i.e.

that the taxpayer has made an incorrect statement, is to be determined

solely on objective grounds and, furthermore, on the basis of

statements made by the taxpayer in the fulfilment of his obligation to

submit correct information necessary for the assessment of the taxes

as such.

        The criteria for imposing a tax supplement are thus the same

as those needed for an additional assessment and there is consequently

hardly reason for viewing the tax supplement issue as something else

than a strictly fiscal matter.  Obviously, a provision providing for

some form of economic hardships for those who fail to fulfil such an

obligation has to be viewed as a quite natural part of the complex of

administrative rules aimed at securing the payment of taxes.  In this

context attention is drawn to Article 1 para. 2 of Protocol No. 1 to

the Convention in which a State's right to enforce such laws as it

deems necessary to secure the payment of taxes is made explicit.

        The contention that the case involves the determination of a

criminal charge is also rejected.  In cases concerning tax matters the

Commission has frequently observed that such proceedings do not

involve the determination of a criminal charge within the meaning of

Article 6 of the Convention.  The close relationship between the taxes

as such and the tax supplement strongly urges that, for the present

purpose, no other considerations be made with regard to the latter.

        Furthermore, the very same failure of the taxpayer to submit

correct information to the tax authorities may also constitute a

criminal offence, namely if the failure is the result of criminal

intent or, as the case may be, a certain degree of negligence on the

part of the taxpayer.  In such a case, the pre-trial investigation,

the prosecution and the trial are carried out by the bodies concerned

with and under the procedural framework governing criminal charges in

general.  It is in this context of no relevance whether or not the tax

supplement has been imposed upon the taxpayer, and the imposition of

the tax supplement does not exclude the possibility of a criminal

charge on the basis of the very same material facts.

        Moreover, in the case law of the Commission, the applicability

of Article 6 to proceedings allegedly relating to a criminal charge

has frequently been viewed in light of the criteria laid down by the

European Court of Human Rights in the Engel case (Eur.  Court H.R.,

Engel and others judgment of 8 June 1976, Series A No. 22).  The Court

held that the question of the applicability of Article 6 was to be

determined in view of, firstly, whether or not under the legal system

of the respondent State the offence charged belongs to the criminal

law sphere; secondly, the very nature of the offence as such; and

thirdly, the degree of severity of the penalty that the person

concerned risks incurring.  Considering the facts of the present case

on the basis of these criteria the conclusion is that the imposition

of the tax supplement involved in the present case does not amount to

the determination of a "criminal charge" within the meaning of

Article 6 of the Convention.

        Systematically the imposition of a tax supplement has never

been regarded in Sweden as forming part of the criminal law but of the

administrative law.  Unlike the Öztürk case (Eur.  Court H. R., Öztürk

judgment of 21 February 1984, Series A No. 73) there has accordingly

never been any "decriminalisation" of the law governing the tax

supplements.

        Furthermore, a number of other circumstances clearly

distinguish the imposition of the tax supplement from the conviction

of a criminal offence.

        Firstly, a significant rationale for subjecting certain acts

and omissions to a criminal charge is to condemn these acts and

omissions as being inconsistent with the state's notions of morality

and justice.  Inherent in this is that a violation of a penal law is

considered an offence only when committed with criminal intent or, as

the case may be, by negligence.  The imposition of a tax supplement, by

contrast, is determined exclusively on objective grounds, i.e. without

regard to any form of criminal intent or of negligence, and,

therefore, lacks the morally delicate element of condemnation inherent

in a criminal conviction (cf.  Eur.  Court H.R., Deweer judgment of

27 July 1980, Series A No. 35, Minelli judgment of 25 March 1983, Series

A No. 62 and the Öztürk judgment mentioned above).  Another difference

is that the tax fraud is investigated by the police and the

prosecutor, while the question of a tax supplement is investigated

by the tax authorities.

        Secondly, in the course of the pre-trial investigation of a

suspected criminal, as well as during the court proceedings, the

person accused is subject to a number of severe coercive measures,

including deprivation of liberty.  The legal provisions providing for

these measures are not to any extent applicable to proceedings for the

imposition of a tax supplement.

        Thirdly, as a general rule those convicted of criminal

offences are registered in a national crime register.  In addition to

the fact that even the very registration as such certainly has to be

considered as involving significant hardship for a person thus

registered, the registration should also be seen in connection with

the fact that a conviction of a criminal offence may have negative

effects of vital importance for the convicted not only in case he

would subsequently commit further offences but also in other contexts

in his daily life.  A person on whom a tax supplement is imposed is

not subject to such registration and the imposition of a tax

supplement does not entail the negative consequences related to the

conviction of a criminal offence.

        Fourthly, unlike a criminal conviction, the imposition of a

tax supplement has no effect of res judicata with respect to any

subsequent criminal charge based on the same facts.  It follows from

this that the present case is in total lack of the characteristics

which the European Court of Human Rights has found decisive when

considering an offence as being criminal in nature.

        As regards the severity of the sanction imposed, it is

observed that the Court and the Commission in this context almost

exclusively seem to have considered proceedings involving deprivation

of liberty, and that not even penalties of this severe character have

been found to necessarily require the proceedings to come within the

guarantees of Article 6.  The present case, by contrast, involves

nothing else than a purely pecuniary sanction, which unlike fines,

cannot be transformed into imprisonment under any circumstances.

        It follows from the above that the imposition of the tax

supplement does not amount to the determination of the applicant's

civil rights and obligations.  Furthermore, as set out above, the

imposition of the tax supplement lacks the characteristics generally

associated with a criminal conviction, both in respect of its

character, the procedural framework within which it is administered

and the consequences following from its imposition.  Under these

circumstances, the Government maintain that the economical

consequences alone cannot suffice to render the imposition of a tax

supplement equivalent to the determination of a "criminal charge"

within the meaning of Article 6 of the Convention.

        Assuming that Article 6 applies in the present case the

Government do not contest the allegation that the applicant was

denied oral proceedings before the courts.  For the following reasons,

however, this did not constitute a breach of Article 6 of the

Convention.

        The question whether the denial to grant the applicant an oral

hearing constitutes a violation of the Convention has to be viewed

purely in light of the facts that were presented to, or otherwise

known by, the Administrative Court of Appeal prior to the Court's

decision.  There was no indication that the applicant intended to

present oral evidence before the Court.

        The appeal was lodged with the Administrative Court of Appeal

on 12 January 1979.  The decision refusing the applicant's request for

an oral hearing was taken on 24 November 1981.  Furthermore, by that

decision the applicant was given an opportunity to submit further

written observations before 10 December 1981.  The judgment was

rendered on 15 February 1982.  At any time prior to the delivery of

the judgment, the Court would have been obliged to reconsider the

question of whether to hold an oral hearing, had the applicant so

requested.  Different considerations would then have been necessary had

the applicant indicated that he wanted to present oral evidence.

However, no such request or indication was made.  In view of this, the

Government find that the applicant was given a fair chance of

indicating his reasons for requesting an oral hearing.

        Furthermore, any possible finding indicating, in principle,

that Article 6 requires an oral hearing in review proceedings, becomes

considerably less, if at all, meritorious in a case like the present

one where the party himself voluntarily refrained from availing himself

of the opportunity to request an oral hearing, and to tender oral

evidence, before the court of first instance when this could have been

done.  This is so because, even assuming that Article 6 in part might

be construed to apply to review proceedings, it cannot be interpreted

so as to require a state to provide guarantees in review proceedings

that would allow a party to cure deficiencies in his case caused by

his own failure to properly, by using the facilities available to him,

present the case before the lower court.  In other words, all that

could possibly be required under the Convention as regards appeal

proceedings would be a fair review of the case as presented before the

lower court.

        Turning now to the question of the extent to which the rules

of Article 6 could be construed to apply to appeal proceedings even

though the right to appeal as such is not guaranteed by the

Convention, attention should be drawn to Article 2 of Protocol No. 7

to the Convention.  In this Article, which concerns criminal

proceedings, the right to appeal is guaranteed (n.b. that the Protocol

is not yet in force).  In the preparation of this Article it was

deemed necessary to make an exception from the right to a public

hearing by a higher court.  This indicates that Article 6 of the

Convention must not be construed so as to pertain fully to

proceedings in a higher instance.  From the case-law of the European

Court of Human Rights it can safely be concluded that Article 6 para.

1 does not necessarily call for an oral hearing in appeal proceedings.

Whether this would be required would depend upon the special features

of the proceedings involved (cf. for example Eur.  Court H.R., Delcourt

judgment of 17 January 1970, Series A No. 11 and the Monnell and Morris

judgment of 2 March 1987, Series A No. 115).

        A higher tribunal should of course be independent and

impartial.  Above this, however, the High Contracting Parties should

have a considerable leeway in designing the system for appeal in their

respective countries.  For various reasons it is necessary in a system

with two or more instances to rationalise the procedure in the higher

instances in order to create a well-functioning administration of the

law.  The procedure should be quick, cheap and simple, while at the

same time satisfying the demands for legal security.

        The proceedings in the Administrative Court of Appeal are

according to the main rule to be conducted in writing.  Oral

proceedings can be held under certain conditions.  The cases which the

court deals with vary considerably, and the rules of procedure make

it possible for the Court to adjust the proceedings accordingly; in

many cases there is no need for oral proceedings, while such

proceedings could sometimes be an advantage or even necessary.  The

opinion and requests from the parties are of great importance when the

Court decides on how the proceedings should be conducted.

        An important factor in this context is the Swedish principle

of general access to official documents.  According to this principle

- which is laid down in the Freedom of the Press Act forming part of

the Swedish Constitution - anybody has the right to have access to the

written submissions to Swedish courts, including the Administrative

Court of Appeal.  This means that there is a full publicity about the

proceedings even if there is no oral hearing.

        Attention is also drawn to the Commission's constant case law

concerning the interpretation of Article 6 and the concept of

"equality of arms", from which it can be deduced that such equality

is at hand if neither party is present before the court during the

proceedings.  It shows that Article 6 must not necessarily be

construed so as to guarantee to the parties the right to appear in

person before a court.

        Finally it could be questioned whether Article 6 of the

Convention calls at all for oral proceedings regardless of the character of

the issues that are presented.  The Commission has in numerous

decisions dealt with the concept of a "fair and public hearing" in a

manner that seems to indicate that all that would be required would be

that a party is provided with appropriate facilities for presenting and

arguing his case and that the opposing party is not put in a more

favourable position with regard to the possibilities of presenting his

position.  This would seem to call for a consideration of such matters

as the scope of the powers of the Court of Appeal, the nature of the

issues presented and the manner in which the applicant's interests

could be presented and protected.  It certainly goes without saying

that the circumstances in a case might be such as to call for an oral

hearing for these requirements to be fulfilled.

        However, it would seem to be equally conceivable that a party

under certain circumstances could be given a perfectly fair chance to

present his case, even though he was not afforded the opportunity of

doing so at an oral hearing (cf.  Eur.  Court H.R., Axen judgment of

8 December 1983, Series A No. 73 and Sutter judgment of 22 February

1984, Series A No. 74).

        As regards the scope of the proceedings, they did indeed

involve a full review of the case, but the power of the Administrative

Court of Appeal was not unlimited.  Thus, in the absence of an appeal

by the tax superintendent, the Court was, as a matter of law, unable

to raise the tax supplement imposed by the lower court.  Furthermore,

the calculation of the tax supplement being a matter of pure

arithmetic, the scope of the Court's powers was in fact limited to

upholding or quashing the lower court's principal decision to impose a

tax supplement.

        In the present case the character and mode of living of the

applicant were of no relevance to the formation of the Court's

opinion.  Furthermore, the facts, as presented by the applicant, were

accepted by the Court with one exception.  In his complaint to the

Commission, the applicant also admits that in the first place the

judgment of the Court was criticised "as a matter of application of

the present Swedish tax law".

        In view of this, and even assuming that the applicant's case

would fall within the scope of Article 6, and that this Article could

be construed to apply to appeal proceedings, an oral hearing in this

case given the way the case stood before the Administrative Court of

Appeal, would obviously not have served any reasonable purpose.

        Finally, as regards the applicant's complaint under Article 6

para. 2 of the Convention, the Government submit that, insofar as

Article 6 is found to be applicable, this complaint has been

introduced out of time and must be rejected for that reason.

The applicant

        When the special charge (skattetillägg) was introduced in

1971-72 incorrect statements in the income declaration were to be

punished as crimes either as fraud or as incorrect statement by gross

negligence.  In case of conviction a tax penalty could also be

imposed.  The legislator wanted, however, to punish more or less every

incorrect statement - not only those made by gross negligence.  The

ordinary courts, being bound to apply the ordinary procedural rules

and hampered thereby, were considered to lack the capacity to handle

such an increasing number of cases, and consequently in order to cope

therewith, the system of "administrative sanctions" was invented.

        The purpose to deter, repress and retaliate remained obvious,

however, and this new system was met with criticism from some circles

already at its start.  Later, in the middle of the seventies a

reappraisal was made by a governmental committee, which also proposed

some changes in the Act based on the experience up till then.

        The committee pointed out that the persons who have had to

pay special charges (skattetillägg) were not to be considered

"criminals" in the social sense.  They had, however, violated an

obligation as against the community and the means of pressure intended

to enforce such obligation had therefore entered into function.  This,

in the view of the committee, led to the result that the

tax-administrative sanctions were of a special character and to be

understood as a special kind of "social sanction" but not as a

punishment.

        From this it is reasonably clear that the function of the

special charge (skattetillägg) is the same as that of a fine, namely

to deter, to repress and, in case of failure thereof, to inflict an

economic suffering upon the wrongdoer.  The difference is that the

sanction is supposed not to be dishonouring, that the presumption of

not-guilty is eliminated and that some other procedural safeguards in

the criminal procedure are more or less abolished.

        Regarding the applicability of Article 6 of the Convention it

is acknowledged that proceedings in tax matters are not per se

governed by this provision.  However, if in the same proceedings tax

matters and criminal charges are handled by the same authority or the

same court, the fact that tax matters are involved will not exclude

the proceedings from the application of Article 6 insofar as a

criminal charge is concerned or made dependent on the outcome of the

tax dispute.  Consequently, if the special charge is considered to be

a tax in the sense of the Convention then Article 6 seems not to

apply.  It is, however, likewise clear that if the special charge is

considered to involve a criminal charge then Article 6 does apply.

        Admittedly, the Swedish Act on Taxation and the provisions on

the special charge have a public-law character - so has also any penal

code of a country - but this does not take it out of the application

of Article 6.  The special charge is officially called, at its

introduction, a system of "administrative sanctions" and the "economic

hardship" is called "avgift" (fee), because if it had been openly

called a punishment (straff) or a fine (böter), the task to impose

these sanctions could not have been entrusted to tax authorities or

tax courts but only to the ordinary courts and then the whole purpose

of the reform would have been spoiled.

        Furthermore it should be pointed out that, as indicated above,

the governmental committee which made an appraisal of the first years

of practice of the system of administrative sanctions and special

charges, in response to the critics of the system, defended it as

being "standing penalties" and compared it to the German system of

"Steuerordnungswidrigkeiten".  The committee said:

        "In this context it may be mentioned that the type of

        contraventions against which the present sanctions are

        directed, in German law is called Steuerordnungswidrigkeiten.

        Ordnungswidrigkeiten are, according to German legal

        terminology, not to be considered as criminal offences.

        Neither are sanctions against them (Verwarnung, Verwarnungsgeld

        and Geldbusse) to be considered punishment but as means

        of pressure to enforce a better state of things (ein Aufruf

        zur Ordnung)."

        The Government have in their observations, when considering

the question of a criminal charge, in particular referred to the Engel

case (Eur.  Court H.R., Engel and others judgment of 8 June 1976,

Series A No. 22).  The Öztürk case (Eur.  Court H.R., Öztürk judgment

of 21 February 1984, Series A No. 73) and the Adolf case (Eur.  Court

H.R., Adolf judgment of 26 March 1982, Series A No. 49) appear,

however, to be of more importance when considering the present case.

        Having regard to the above judgments it is clear that the

interpretation of "criminal charge" as well as "civil rights and

obligations" in the sense of the Convention is an autonomous one which

may or may not follow the characterisation made in the national legal

system.  The characterisation made under the national law seems to be

conclusive only where the national law itself qualifies the

proceedings as "criminal".

        The Court also paid attention to circumstances such as how

close the system in question comes to the ordinary criminal

proceedings.  In this context it may be pointed out that the Swedish

system, although it is called "skattetillägg" and "administrative

sanctions", nevertheless is handled by the courts, i.e. the tax

courts.  The general character of the rule and the purpose of the

special charge are both deterrent and punitive.

        A tax is imposed on income or on fortune or upon a sales price

but not because a person does not comply with a legal obligation to

present his tax return or to give any other type of information.  This

is a typical sanction, a penalty, and has nothing to do with taxes

even if it is handled by the tax authorities.  The reason for that is

to make it easy for the authorities to impose the sanction upon the

taxpayer.  Furthermore, if an incorrect statement is discovered which

would justify the imposition of a special charge and if the taxpayer

happens to die before the special charge has been imposed there will

be no special charge.  A tax is not dispensed with in relation to the

taxpayer because he dies.  If he is subject to tax, either he pays it

when he is alive or his estate pays the tax.  The comparison with

regular punishment of penalties is obvious.  There the rule is, just

as in regard to the special charge, that if the accused person or the

person upon whom the fine is imposed dies before the fine is paid, the

fine will not be executed.

        It is true that tax authorities cannot arrest a person, but

subject only to that exception they can order as fargoing coercive

measures as any prosecutor.  A tax inspector may search the tax-

payer's home and seize any documents without asking any court for

authorisation or confirmation.  Only when the tax inspector wishes to

search some other person's house he has to request the permission of

a tax court.  Furthermore, if the tax inspector refers the taxpayer's

case as a matter of fraud to a public prosecutor, the result of the

criminal investigation led by the prosecutor and of the proceedings

may likewise be used for the determination of the special charge by a

tax court.

        Regarding the severity of the sanction imposed, the Öztürk

case involved a fine of only 60 German marks and an amount of only

63.90 German marks for the interpreter's fee.  Nevertheless both the

Commission and the Court found Article 6 applicable.

        The special charge or charges amount in this case to 120,399

Swedish crowns.  At that time the maximum fine which could be imposed

in criminal proceedings was 180 "day-fines" at a maximum of 500

Swedish crowns per day or 90,000 Swedish crowns corresponding to

90 days in prison.  It is obvious from this that the special charge is

not to be compared with any petty offences.  Together with the tax it may

easily take away more than the total income.  Although there may be

valid reasons to consider some petty offences not to be covered by

Article 6 of the Convention, this cannot apply to the applicant's case

and there is therefore no reason to try to point out where for the

purpose of Article 6 of the Convention such distinctive line, if any,

should be drawn.  It should only be added that, if the special charge

would not be considered a "criminal charge", the amounts which are

claimed by the Government as "fees" are of such magnitude that the

claim must then be considered a civil "obligation" in the sense of

Article 6 of the Convention.

        Regarding the proceedings in question it is undisputed that

the applicant requested an oral hearing.  This in common language and

by necessity means that he wanted to address the Court orally.  It was

not at that time said that the applicant wanted to have some other

expert or witness examined but he reserved explicitly his right to

indicate so later, which is quite normal in Swedish proceedings.  The

Court, however, never gave him a chance thereto before its decision.

On its own motion, without awaiting any reaction on the applicant's

written request from the other party the Court already the next day

decided not to allow an oral hearing.

        The applicant did not request an oral hearing before the court

of first instance.  However, the fact that no oral hearing was

held in the first instance would speak in favour of rather than against

the need for an oral hearing in the appeal court.  The Swedish Act on

Administrative Court Procedure makes no distinction between appeal

proceedings and the proceedings in the first instance.  In both cases

oral hearings shall be held unless there are particular reasons

against it.

        Further, when the applicant's case was before the court of

first instance, the tax superintendent had requested that a special

charge should be imposed, but in an earlier decision concerning the

previous years no such request had been made and no charge had been

imposed.  In a similar case the tax court had dispensed with the

special charge referring to the complexity of the legal situation.  So

in the present case the applicant had no reason to believe that the

same court would not follow the practice introduced in his own

previous cases and in other similar cases.  It would seem that the

applicant's case in the court of first instance was the first one

where such a special charge was imposed upon an artist for income

going to a foreign company and not to himself.  This made the

applicant and his lawyer request an oral hearing in the Court of

Appeal.

        According to the established case-law of the Commission and

the Court it is clear that a State, which institutes an appeal court,

is required to ensure that persons amenable to the law shall enjoy

before that court the fundamental guarantees contained in Article 6.

The way in which this provision applies, depends, however, on the

special features of the proceedings in question.

        In some cases the Commission and/or the Court have found that

in a Supreme Court or in a Court of Cassation, where the review of the

case is limited to questions of law, oral hearings may be dispensed

with.  In the present case, however, the Court of Appeal has not been

limited by any such restrictions.  They had the full review of the case.

        In other cases the Court or the Commission has attached

importance to the fact that the charge against the accused could not

be severed by the higher court and that the higher court for its

decision did not have to make any appreciation of the personal

circumstances of the accused.  Such is not the situation in the

present case.

        Liability for taxes is admittedly a prerequisite for the

imposition of a special charge, so if there is no tax there can be no

special charge.  The reverse, however, is not correct.  Even if a

lower tax court has found the taxpayer liable for taxes following an

incorrect or incomplete statement and the taxpayer appeals only in

respect of the special charge, the higher court is not bound for the

imposition of the special charge by the findings of the lower court.

The higher court has, independently of what the lower court may have

found, to decide whether the taxpayer has made an incorrect or

incomplete statement.  If it finds that he has not done so there is no

room for a special charge.  In these circumstances an oral hearing

must be held if the applicant asks for one.  This view is supported by

the Commission in its Report in the Ekbatani case (Ekbatani v.

Sweden, Comm.  Report 7.10.86) where the Commission stated that in a

case where a power involving direct assessment of the applicant's

personality is exercised in the proceedings against the applicant, the

Convention requires that he should be allowed a public hearing and be

present at these proceedings if he so requests (para. 70 of the

Report).

        The applicant can - for the purposes of the present

proceedings - admit that a party to the Convention shall have a

considerable leeway in designing the system for appeal in its country.

Sweden has had such leeway and there is nothing wrong in the way the

Swedish legislation has been designed on that point.  The law says

explicitly that the taxpayer is entitled (as a matter of his

procedural right to a proper defence) to request an oral hearing,

including the presentation of oral evidence.  The Administrative Court

of Appeal acted wrongly when, despite the said procedural

provision, it did not allow an oral hearing.

        In cases like the present one where the outcome may depend on

the personal circumstances of the applicant or his credibility, an

oral hearing if so requested is imperative to make the proceedings

fair.  In this respect it is pointed out that it has been made obvious

not least by the way the Government have reported the contents of

Section 116 of the Act on Taxation, that the character and the

personal circumstances of the taxpayer is not without relevance to the

question whether a special charge should be imposed or not.  It is

true that in the legal text no reference is made to "negligence" or

"intent", and in the travaux préparatoires it is pretended that such

factors are not determining for the imposition of the special charge.

On the other hand it is clear that subjective elements may influence a

decision not to impose a special charge, as "lack of experience" or

other particular circumstances may make the statement or omission

"excusable".

        The objection of the Government that an oral hearing would not

have served any meaningful purpose cannot be accepted.  Oral hearings

were held in other similar cases with the result that no special

charge was imposed or that the decision of the lower court was

reversed.  As the outcome of the applicant's case depended on whether

at all he was liable for taxes on income which he had never received

but which was paid to the company of his agent and whether his failure

to report income he never received was to be considered as excusable

in the sense of Section 116 a of the Swedish Act on Taxation, it

cannot in advance be said that an oral hearing, where the applicant in

person could have explained his situation, would have been

meaningless.

        Certainly, a subjective element as the insight of the taxpayer

as to what extent he had to provide the tax authorities with

information without being particularly requested to do so, may be

relevant in this context as set out by the Government in its bill

submitted to the Parliament.  There are also ample precedents to that

end.  The reasons advanced by the Court of Appeal as to the merits of

the case are remarkably delphic.  The Court just says that considering

what has transpired in the earlier case and the present one the Court

finds the applicant liable to income tax for all sums paid out by the

film producer.  The only explanation of the outcome of the case is

that the Court did not believe the applicant when he said he had no

influence on the company belonging to his agent, or that the Court did

not know enough about the conditions of the film actor market, which

makes it a necessity, even for many actors more prominent than the

applicant was at the time, to use an agent as intermediary.

        It was also for this reason that the applicant wished to

be heard himself and to have a witness examined, a prominent man both

in the film and banking world and with a high standard of credibility.

Everyone who has been sitting in a court knows that it adds to the

credibility of written statements if the party, witness or expert may

be exposed to questions of the Court and the parties.

        Having regard to these circumstances and the possible

consequences which in the present case amounted to a special charge

totalling 120,399 Swedish crowns the applicant finds that when tax

liability is denied or when otherwise non-liability in respect of the

special charge is claimed by the taxpayer and he requests a fair and

public hearing and an opportunity to present evidence before the Tax

Court, such procedure must take place as a matter of a fair and public

hearing.

THE LAW

1.      The applicant has complained that a special charge (tax

supplement) (särskild avgift (skattetillägg)) amounting to 120,399 SEK

has been imposed upon him without a fair and public hearing and that

he had no separate effective remedy against the refusal of the

Administrative Court of Appeal to hold an oral hearing.  The applicant

considers that the imposition of the special charge (tax supplement)

concerns the determination of a criminal charge or, in the

alternative, the determination of a civil right and he has invoked

Articles 6 and 13 (Art. 6, 13) of the Convention.

        The Government have submitted that the present case neither

involves the determination of a civil right nor of a criminal charge

and, even assuming that this was the case, that all rights guaranteed

by the Convention have been secured.

        The Commission has made a preliminary examination of this

complaint and has come to the conclusion that it raises serious issues

as to the interpretation of the Convention, in particular as to the

question whether the case involves the determination of a criminal

charge within the meaning of Article 6 (Art. 6) of the Convention and,

if so, whether the applicant has been afforded the guarantees of this

provision in the relevant proceedings.  The Commission finds that

these issues can only be determined after an examination on their

merits and they must therefore be declared admissible, no other

grounds for rejecting them having been found.

2.      The applicant has furthermore complained that since he had to

prove his innocence or show that particular circumstances were present

in order to avoid the imposition of the special charge (tax supplement), his

right under Article 6 para. 2 (Art. 6-2) of the Convention to be presumed

innocent until proved guilty according to law has been breached.

        The Government have submitted that this particular complaint

has been introduced out of time.

        The Commission agrees with the Government.  It is true that

Article 6 para. 2 (Art. 6-2) secures to everyone the right to be presumed

innocent until proved guilty according to law.  However, the

Commission finds that the applicant's complaint concerning the

presumption of innocence is a separate complaint which can be

distinguished from the complaint dealt with above.

        In these circumstances the Commission recalls that Article 26 (Art. 26)

of the Convention provides that the Commission "may only deal with the matter

... within a period of six months from the date on which the final decision was

taken".  In the present case the decision of the Supreme Administrative Court,

which was the final decision regarding this matter was given on 31 August 1984

whereas this particular complaint was submitted to the Commission on 27

November 1985, that is more than six months after the date of this decision.

Furthermore, an examination of the case does not disclose the existence of any

special circumstances which might have interrupted or suspended the running of

that period.

        It follows that this part of the application has been

introduced out of time and must be rejected under Article 27 para. 3

(Art. 27-3) of the Convention.

        For these reasons, the Commission

        DECLARES ADMISSIBLE without prejudging the merits of the

        case, the complaint concerning the imposition of the special

        charge (tax supplement) without a fair and public hearing

and

        DECLARES INADMISSIBLE the remainder of the application.

Secretary to the Commission         President of the Commission

    (H. C. KRÜGER)                       (C. A. NØRGAARD)

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