Communicated on 11 October 2019

FIFTH SECTION

Application no. 38018/11 REGUL EOOD against Bulgaria lodged on 10 June 2011

STATEMENT OF FACTS

The applicant, Regul EOOD, is a Bulgarian company. It is represented before the Court by Ms S. Margaritova-Vuchkova , a lawyer practising in Sofia.

A. The circumstances of the case

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

1. The applicant ’ s privatisation request and ensuing judicial proceedings

On 14 September 1993 the applicant company entered into a lease agreement with Botevgrad Municipality under which it rented a plot – a summer garden of a restaurant – owned by the municipality . On 23 September 1994 the applicant company submitted a proposal to the Botevgrad Municipal Council to purchase the summer garden. It sought to benefit from the preferential privatisation procedure for lessees of State and municipally-owned properties provided for in section 35(1) of the Transformation and Privatisation of State and Municipally ‑ Owned Enterprises Act ( Закон за преобразуване и приватизация на държавни и общински предприятия : “the Privatisation Act”) . By a decision of 26 October 1994 the Botevgrad Municipal Council opened a privatisation procedure for a number of municipality-owned properties, in cluding the summer garden. On 1 November 1994 the applicant company received a notification of the commenced procedure. The municipal council did not rule on the applicant company ’ s proposal within the three-month deadline envisaged by the Privatisation Act.

The applicant company then submitted an appeal against the tacit refusal of the municipal council to examine the proposal. By a decision of 11 May 1995 the Sofia Regional Court dismissed the appeal. However, by a decision of 23 November 1995 the Supreme Court of Cassation quashed the lower court ’ s decision and referred the matter back to it for re-examination. By a final judgment of 11 March 1996 the Sofia Regional Court quashed the Botevgrad Municipal Council ’ s tacit refusal to decide on the proposal and referred the matter back to it to complete the procedure, which included the transfer of the property to the applicant company. It found that the applicant company had submitted a valid privatisation proposal under the preferential procedure, had complied with all the requirements of the Privatisation Act to have the property rights over the summer garden transferred, and that in failing to rule on its proposal and transfer the property, the municipal council had acted in contravention of the law.

Meanwhile, by a decision of 28 August 1995 the mayor of Botevgrad approved a draft amendment of the city ’ s construction plan. According to the proposed amendment, the site of the restaurant and the summer garden would be rearranged in an administrative building, a restaurant, and a bazar.

By a decision of 28 November 1996 the Botevgrad Municipal Council stayed the privatisation procedure, citing grounds relating to the clarification of the property rights over the plot as a property dispute was pending between the Sofia Regional Administration and Botevgrad Municipality. It seems that the latter dispute was eventually resolved in favour of Botevgrad Municipality. By another decision of 4 March 1997 the municipal council terminated the privatisation procedure concerning the summer garden without specifying any reasons. The applicant company challenged both decisions before the courts, and the two appeals were merged and examined in a single set of proceedings. By a judgment of 26 March 1998 the Sofia Regional Court quashed both decisions of the municipal council and referred the matter back to it, ruling that it had to complete the privatisation procedure. In particular, the law required that in completing the procedure the municipal council had to therefore either agree to the sale of the plot or to refuse it if the grounds for a refusal were present. Even if it considered that a different State body was competent to examine the proposal, it was still obliged to refer the file to that body, and not to stay or terminate the procedure. The appeal submitted by the Botevgrad Municipal Council against the judgment of 26 March 1998 was lodged out of time and the Supreme Administrative Court dismissed it in its final decision of 15 February 1999. The Sofia Regional Court ’ s judgment then entered into force.

2. Attempts by the applicant company to obtain enforcement of t he judgments of the Sofia Regional Court of 11 March 1996 and 26 March 1998

On 21 April 1999 the applicant company submitted a request before the Supreme Administrative Court for sanctions to be imposed on the President of the Botevgrad Municipal Council for failure to have the judgment of 26 March 1998 executed. The applicant company relied on section 52 of the Supreme Administrative Court Act. The outcome of those proceedings is unknown.

The applicant company made identical submissions requesting that the privatisation procedure be completed before a number of bodies, including the Botevgrad district prosecutor ’ s office, the municipal council, the Privatisation Agency and the mayor of Botevgrad . In reply, the Botevgrad district prosecutor ’ s office referred a letter on 1 April 1999 to the mayor of Botevgrad with instructions for the privatisation procedure to be re-initiated before the municipal council.

On 21 April 1999 the applicant company submitted a complaint before the governor of the Sofia Region, alleging that the mayor of Botevgrad and the President of the municipal council had committed unlawful actions in relation to the procedure. The applicant alleges, without providing relevant documents in that respect, that the governor requested information from the municipal council on the matter, and that the municipal council replied that a restitution dispute was pending as regards the plot and the privatisation procedure would be completed once that dispute was resolved. It is not clear what the exact outcome of the said restitution dispute was. However, in a submission of 12 March 2006, addressed to the Botevgrad Municipal Council, the applicant company referred to the restitution claims regarding the summer garden as having been rejected by a judgment of the Botevgrad District Court of 21 October 2005.

3. Subsequent refusal of the municipal council to launch a privatisation procedure

In its written submission addressed to the Botevgrad Municipal Council on 12 March 2006 the applicant company once again raised the issue of completing the privatisation procedure. On 27 July 2006 the municipal council took a decision to open a new privatisation procedure for the plot; however, on 30 November 2006 it issued another decision quashing the previous one, and finding that the already commenced privatisation procedure had to be completed.

On 28 December 2006 the municipal council took a third decision regarding the summer garden by which it quashed its previous decision of 30 November 2006 and refused to carry out the privatisation procedure. The municipal council quoted as grounds the fact that the rental agreement had been concluded with the municipality and not with a state or municipality ‑ owned enterprise; that the summer garden was included in the restaurant and was not a separate part as provided for in the Privatisation Act, and that it no longer existed as it had meanwhile been transformed into a bazar; that the decision for the privatisation procedure had not been published in the State gazette or announced in central newspapers; that the decision to open the procedure did not contain the elements required by law. By a judgment of 10 March 2008 the Sofia Regional Court quashed the municipal council ’ s decision of 28 December 2006. However, u pon appeal, by a judgment of 11 November 2008 the Supreme Administrative Court quashed the lower court ’ s judgment and referred the matter back to it for re ‑ examination. By a new judgment of 27 January 2010 the Sofia Regional Court rejected the applicant company ’ s appeal against the municipal council ’ s decision. The court found that the evidence gathered did not show that the summer garden had been the property of the municipality or of a municipality-owned company, and that the garden as such no longer existed. Even if the latter still existed, it could not be considered a separate part within the definition provided by the Privatisation Act as it was only an attachment to the restaurant and as such could not itself be subject to privatisation . By a final judgment of 28 December 2010 the Supreme Administrative Court upheld the lower court ’ s judgment.

4. Other developments of relevance

In the meantime, by a decision of 24 April 2008 the Botevgrad Municipal Council took a decision by which it gave its consent for the removal of a building and some metal constructions situated on the plot, authorising the mayor of Botevgrad to carry out the necessary actions in that respect. Claiming that the objects that were to be removed were also subject to the privatisation procedure, the applicant company sought judicial review of the decision. By a judgment of 18 August 2008 the Administrative Court of Sofia Region granted the appeal. In particular, the court found that removing the said objects would drastically compromise the interests of the applicant company as it would render the pending privatisation procedure obsolete. It further noted that the privatisation procedure had already been pending for fourteen years due to the fault of the municipal council, and the latter ’ s actions clearly showed its reluctance to execute the two final judgments for the privatisation of the property, despite the fact that the governor of Sofia Region and the Botevgrad district prosecutor ’ s office had also given it instructions in that connection. The court concluded that the municipal council had acted in an abusive manner, ignoring the applicant company ’ s right to acquire the property under the preferential procedure. By a final judgment of 19 May 2009 the Supreme Administrative Court upheld the lower court ’ s judgment.

On 26 June 2008 the Botevgrad Municipal Council took a decision in relation to the sale of the plot that was subject to the privatisation procedure. The applicant company again sought judicial review. The Administrative Court of Sofia Region terminated the proceedings but, upon appeal, the Supreme Administrative Court quashed its decision and referred the matter back to it for re-examination. By a judgment of 20 July 2009 the Administrative Court of Sofia Region granted the applicant company ’ s appeal. The court found that the decision for such a sale was unlawful as the plot was the same as the one subject to the privatisation procedure. By a final judgment of 3 June 2010 the Supreme Administrative Court upheld the lower court ’ s judgment.

B. Relevant domestic law

1. Privatisation

The relevant provisions of the Transformation and Privatisation of State and Municipally ‑ Owned Enterprises Act ( Закон за преобразуване и приватизация на държавни и общински предприятия : “the Privatisation Act”) governing the preferential privatisation procedure are summarised in the case of Basarba OOD v. Bulgaria , no. 77660/01, §§ 18-22, 7 January 2010.

2. Enforcement of final administrative court judgments

The relevant provisions governing the enforcement of final administrative court judgments under the Code of Administrative Procedure 2006 are summarised in Dimitar Yanakiev v. Bulgaria , no. 50346/07, §§ 30 ‑ 35, 31 March 2016; and Stoyanov and Tabakov v. Bulgaria , no. 34130/04, §§ 53-57, 26 November 2013. The relevant provisions governing the enforcement of such judgments before the adoption of the 2006 Code are summarised in Yagnina v. Bulgaria , no. 18238/06, §§ 19-20, 27 January 2015.

3. State and municipal liability for damages

The relevant provisions governing the State ’ s and municipalities ’ liability for unlawful acts and omissions under the State and Municipalities Responsibility for Damage Act 1988 are summarised in Guseva v. Bulgaria , no. 6987/07, § 29, 17 February 2015.

COMPLAINTS

The applicant company complains under Article 6 § 1 of the Convention that the municipal authorities infringed its right, recognised in final judgments, to purchase a leased property under a preferential privatisation procedure for tenants of municipally-owned property. It also complains under Article 6 § 1 about the lack of legal certainty as a result of the non ‑ enforcement of the final judgments.

The applicant company complains under Article 1 of Protocol No. 1 that the municipal authorities infringed its right to purchase the summer garden under the preferential conditions of the Privatisation Act.

Finally, the applicant company complains under Article 13, in conjunction with Article 6 § 1 and Article 1 of Protocol No. 1, that it did not have effective domestic remedies in respect of its complaints.

QUESTIONS TO THE PARTIES

1. Did the applicant company comply with the six-month time-limit under Article 35 § 1 of the Convention with respect to its complaints under Article 6 § 1, Article 13 and Article 1 of Protocol No. 1? In particular, what date should be considered as a starting point for the six-month time-limit?

2. Did the applicant company exhaust the effective domestic remedi es, as required by Article 35 § 1 of the Convention, with respect to those complaints?

3. Did the failure to implement the judgments of the Sofia Regional Court, respectively of 11 March 1996 and 26 March 1998, constitute a breach, within the meaning of Article 6 § 1 of the Convention, of the applicant company ’ s right to effective protection of its civil rights stemming from those judgments ( Basarba OOD v. Bulgaria , no. 77660/01, § 33, 7 January 2010; Popnikolov v. Bulgaria , no. 30388/02, § 30, 25 March 2010; Stoyanov and Tabakov v. Bulgaria , no. 34130/04, § 85, 26 November 2013)?

Also, having regard to the judgment of the Supreme Administrative Court dated 28 December 2010, according to which the privatisation could not take place, was the applicant company placed in a situation of legal uncertainty, contrary to the requirements of Article 6 § 1 of the Convention?

4. Did the applicant company have a “possession” within the meaning of Article 1 of Protocol No. 1 to the Convention and, if so, from which moment? In particular, did the applicant company have a legitimate expectation, under Article 1 of Protocol No. 1, to have the abovementioned judgments of the Sofia Regional Court implemented? Was there a failure on the part of the authorities to implement the judgments, amounting to an unlawful or unjustified interference with the applicant company ’ s right to peaceful enjoyment of its possessions under Article 1 of Protocol No. 1 ( Basarba OOD v. Bulgaria , no. 77660/01, § 48, 7 January 2010; Popnikolov v. Bulgaria , no. 30388/02, § 44, 25 March 2010; Stoyanov and Tabakov v. Bulgaria , no. 34130/04, § 85, 26 November 2013)?

5. Did the applicant company have at its disposal effective remedies under Article 13 of the Convention to raise its complaint under Article 1 of Protocol No. 1?

The parties are invited to submit all relevant information and documents related to the restitution proceedings concerning the property at issue. They are further requested to specify the outcome of those proceedings.

The parties should also provide all relevant information and documents as regards the outcome of the applicant company ’ s request of 21 April 1999 submitted before the Supreme Administrative Court for sanctions to be imposed on the President of the Botevgrad Municipal Council, as well as information about all other developments of relevance with regard, in particular, to the period between 15 February 1999 and 12 March 2006.