THIRD SECTION

FINAL DECISION

Application no. 42402/04 by KJELD OHLAND ANDERSEN AB I KONKURS against Sweden

The European Court of Human Rights (Third Section), sitting on 20 May 2008 as a Chamber composed of:

Josep Casadevall , President, Elisabet Fura-Sandström , Boštjan M. Zupančič , Alvina Gyulumyan , Ineta Ziemele , Luis López Guerra , Ann Power , judges, and Stanley Naismith , Deputy Section Registrar ,

Having regard to the above application lodged on 23 November 2004,

Having regard to the partial decision of 4 October 2007 ,

Having regard to the decision to apply Article 29 § 3 of the Convention and examine the admissibility and merits of the case together,

Having r egard to the formal declaration accepting a friendly settlement of the case,

Having deliberated, decides as follows:

THE FACTS

The applicant is a Swedish limited company, Kjeld Ohland- Andersen A B i konkurs . It is represented before the Court by Mr B. Leidhammar, a lawyer practising in Stockholm .

The Swedish Government (“the Government”) were represented by their Agent, Mr B. Sjöberg , of the Ministry for Foreign Affairs .

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

In January 1996 the Tax Authority ( skattemyndigheten ) of the County of Norrbotten commenced a tax audit ( revisionspromemoria ) of the applicant covering its book-keeping and business transactions from 1 January 1993 to 31 December 1995.

On 28 February 1997 it sent a preliminary consideration to the applicant, called a “basis for discussion” ( diskussionsunderlag ), in which it stated that it was minded to revise the assessment of arrears ( eftertaxering ) of the applicant ’ s tax returns regarding income tax, employer ’ s contributions and value-added tax for the years 1993 to 1995 and to impose tax surcharges on it.

On 28 April 1997 the audit report was finalised by the Tax Authority and sent for comments to the applicant. It essentially confirmed the findings set out in the preliminary consideration.

The applicant maintained that its tax returns were correct and opposed any changes to them. Still, on 1 July 1997 and on 12 June 1998, the Tax Authority decided, in accordance with its findings in the tax audit, to alter the applicant ’ s tax returns for the relevant years and to impose tax surcharges amounting to, in total for the three years, approximately SEK 1,550,000 (approximately EUR 165,800).

The applicant appealed against the Tax Authority ’ s decisions, disputing its findings and insisting that there were no grounds for changing its tax returns or imposing tax surcharges.

On 25 June 1998 the applicant was declared bankrupt. However, the company ’ s owner was allowed to continue the proceedings on its behalf.

On 31 August 1998 and on 2 May 2000, respectively, the Tax Authority made the obligatory re-assessment of its decisions of 1 July 1997 and 12 June 1998, but decided not to change them and then forwarded the appeals to the County Administrative Court ( länsrätten ) of the County of Norrbotten .

On 5 October 2000, after having held an oral hearing, the County Administrative Court gave judgment. It first found that the applicant ’ s book-keeping had been so seriously flawed that the Tax Authority had been justified in making an assessment of arrears of the applicant ’ s tax returns for the relevant years. It then rejected the applicant ’ s appeals, except in so far as concerned a part of the employer ’ s contributions for the year 1994, which were removed. It also remitted a part of the tax surcharges.

Both the applicant and the Tax Authority appealed against the judgment to the Administrative Court of Appeal ( kammarrätten ) in Sundsvall .

On 21 October 2002, after having held an oral hearing, the Administrative Court of Appeal partly accepted the applicant ’ s appeal on one of the issues relating to the employer ’ s contributions and thus lowered the tax surcharges accordingly.

The Administrative Court of Appeal gave judgment on the remaining issues on 3 December 2003. It granted a part of the applicant ’ s appeal by lowering somewhat the basis for the value-added tax and for the employer ’ s contributions for the years 1994 and 1995. The tax surcharges on these sums were lowered accordingly. However, the court also granted, partially, the Tax Authority ’ s appeal in that it increased the part of the tax surcharges which had been lowered by the County Administrative Court .

The applicant appealed against both judgments to the Supreme Administrative Court ( Regeringsrätten ), which refused leave to appeal on 24 May 2004 and 28 June 2004, respectively.

COMPLAINTS

The applicant complained under Article 6 § 1 of the Convention that the length of the proceedings had been excessive, the proceedings for the three tax assessment years lasting approximately s even years and three months . The applicant further alleged that it had been deprived of an effective remedy, as guaranteed by Article 13 of the Convention, since its case had not been finalised within a reasonable time.

THE LAW

On 26 February 2008 the Court received the following declaration from the Government, signed by the Agent of the Government on 5 February 2008 and by the applicant ’ s representative on 22 February 2008 :

“ On 23 November 2004, Kjeld Ohland-Andersen AB i konkurs (“the applicant”) lodged application no. 42402/04 against Sweden with the European Court of Human Rights (“the Court”). The application was communicated to the Swedish Government (“the Government”) on 10 October 2007.

The Government and the applicant have now reached the following friendly settlement on the basis of respect for human rights, as defined in the European Convention for the Protection of Human Rights and Fundamental Freedoms, in order to terminate the proceedings before the Court.

a) The Government will pay, ex gratia , the sum of SEK 80,000 (eighty thousand) [1] , to the applicant. Execution of payment will take place when the Government has received the Court ’ s decision striking the case out of its list of cases.

b) The applicant declares that it has no further claims on the Swedish State based on the facts of the above application.

This settlement is dependent upon the formal approval of the Government at a Cabinet meeting.”

The settlement was approved by the Government on 13 March 2008.

The Court takes note of the friendly settlement reached between the parties. It is satisfied that the settlement is based on respect for human rights as defined in the Convention and its Protocols and finds no public policy reasons to justify a continued examination of the application (Article 37 § 1 in fine of the Convention). In view of the above, it is appropriate to discontinue the application of Article 29 § 3 and to strike the case out of the list.

For these reasons, the Court unanimously

Decides to strike the application out of its list of cases.

Stanley Naismith Josep Casadevall              Deputy Registrar President

[1] Approximately EUR 8,525