PARTLY DISSENTING OPINION OF JUDGES RYSSDAL AND BAKA

We share the Court ’ s opinion that there have been violations of Article 6 para . 1 (art. 6-1) of the Convention in the present case both because of the lack of a fair trial and because of the length of proceedings.

However, we have voted against the finding of a breach of Article 1 of Protocol No. 1 (P1-1).

We consider that there was a deprivation of the applicant ’ s possessions within the meaning of the second sentence of Article 1 of Protocol No. 1 (P1-1). It has therefore to be decided whether the deprivation was in the public interest and subject to the conditions provided for by law as required by this provision.

The pre-emption of the applicant ’ s property was based on Article 668 of the General Tax Code which gives the tax authorities the right to purchase by pre-emption any property whose sale price they consider to be too low. In such a case the authorities may exercise this right for the benefit of the Treasury by "offering to pay the rightful claimants the price in question and a premium of ten per cent". This right of pre-emption is designed to prevent tax evasion and, like the majority of the Court (paragraph 39), we consider the prevention of tax evasion to be a legitimate objective which is in the public interest.

In our opinion the pre-emption was also exercised subject to the conditions provided for by law. In particular, Article 668 of the General Tax Code was adequately accessible and formulated with sufficient precision.

According to the case-law of the Court, "there must also be a reasonable relationship of proportionality between the means employed and the aim sought to be realised" (see the Lithgow and Others v. the United Kingdom judgment of 8 July 1986, Series A no. 102, p. 50, para . 120). An important factor in the assessment of such proportionality is the compensation to be paid. As already mentioned, the amount of such compensation in pre-emption cases is fixed by law as the purchase price plus a premium of ten per cent. In addition the tax authorities were obliged to pay the costs and fair expenses.

Having regard to the compensation paid and to the margin of appreciation left by Article 1 of Protocol No. 1 (P1-1) to the national authorities, we have come to the conclusion that this Article was not violated in the present case.

PARTLY DISSENTING OPINION OF JUDGES PETTITI AND VALTICOS

(Translation)

We voted in favour of finding that there had been a breach of Article 6 para . 1 (art. 6-1) of the European Convention on Human Rights on the ground that the proceedings had not been fair and that their length had been excessive. We did not vote in favour of finding a breach of Protocol No. 1 (P1).

It appeared to us that in the consideration of the system adopted in France for the right of pre-emption in respect of real-property sales regard should be had above all to the relevant national law and its special features, which are different from those of other member States of the Council of Europe.

Vendors and purchasers are duly informed of the obligation to be honest in declarations of price. As regards false statements, for instance, several provisions of the General Tax Code (GTC) require the parties to a contract for the sale of real property or of a business or to a right to a lease or a promise of a lease and parties to contracts for the partition or exchange of real property or of a business to certify at the bottom of the contract that it "represents, on pain of the penalties provided for in the Act of 18 April 1918 (Art. 1837 GTC), the full agreed price or balance in cash" (Art. 850 GTC).

Article 863 of the GTC imposes a similar obligation on a notary who draws up a contract of sale, exchange or partition, requiring him to notify the parties of the penalties provided for in Articles 850 and 1837 of the GTC and in Article 366 of the Criminal Code. In the same way, Article 864 requires notaries who draw up contracts transferring real property, a business or a professional office (office ministériel ) to inform the parties of the penalties attaching to concealment, to mention in the contract that this has been done and to state in it that, to his knowledge, the contract is not altered or contradicted by any secret document containing an increase in the price (see Bruron , Droit pénal fiscal, Paris, Librairie générale de droit et de jurisprudence).

This is distinct from the right of pre-emption but certainly has the same aim of foreseeability and deterrence. The right of pre-emption is exercised in order to ensure a distribution of registration fees by regulating the property market. In order to avoid underestimations which ultimately penalise those who are completely honest in their price declarations by altering the total tax revenue, each State adopts a particular arrangement which is part of its general fiscal policy.

These fiscal policies, as such, are not covered by the European Convention and Protocol No. 1. In our view, only if tax provisions that might amount to an interference with possessions or with the use of property did not provide opportunities for appeal in accordance with Article 6 (art. 6) of the Convention might there hypothetically be a breach of Protocol No. 1 and Article 6 (P1, art. 6) taken together, without any separate breach of Protocol No. 1 (P1) taken on its own.

We would cite various arrangements adopted by other States to prevent concealment or underestimation of prices.

GERMANY

Tax offences ( Steuerordnungswidrigkeiten ) include, for example, underestimation of tax payable without fraudulent intent, the making of inaccurate tax returns, actions designed to jeopardise the collection of taxes without fraudulent intent or to secure or retain unjustified tax concessions and breaches of the obligation to retain and transfer tax deducted at source. They are punished by administrative fines.

The offence of tax evasion is defined as follows in section 370 of the General Tax Act:

"A person shall be liable to imprisonment not exceeding five years or a criminal fine if he

1. supplies financial or other authorities with inaccurate or incomplete information about facts of importance for tax purposes;

2. contrary to his obligations, fails to inform the financial authorities of facts of importance for tax purposes;

3. ..."

Attempted evasion is punishable in the same way as the offence of tax evasion.

A particularly serious offence is committed by anyone who makes serious underestimations of his income or claims unjustified tax concessions through his own actions.

NETHERLANDS

Section 68 of the General National Taxation Act ( Algemene Wet inzake Rijksbelastingen ) provides for the criminal prosecution and punishment of tax evasion. This offence may be committed by failure to make a tax return, making an inaccurate and incomplete return, failing to submit document s, failing to keep accounts, submitting falsified documents or failing to keep account documents or books. Such offences are punishable by imprisonment for a period not exceeding six months and/or a third-category fine (section 68(1)). The definition is an extremely wide one since fraudulent intent does not have to be proved and the rigour of the principle means that negligence or mistake may give rise to criminal proceedings.

ITALY

Tax evasion is made a punishable offence by Law no. 4 of 7 January 1929 laying down general rules for the prosecution and punishment of offences against finance Acts and by special tax laws, in particular on VAT and direct taxes (Legislative Decree no. 429 of 10 July 1982, Law no. 516 of 7 August 1982 and Law no. 154 of 15 May 1991); in the absence of any specific enactment, prosecutions can be brought under the Code of Criminal Procedure. All these provisions exhaustively list the various offences and the penalties attaching to them. The same penalties apply to underestimations in returns.

Admittedly, these measures do not provide for a right of pre-emption, but the fiscal-policy objective is of the same kind. Several States also have arrangements for pre-emption in respect of agricultural property or property belonging to the artistic heritage.

The Court has rightly held that the interference was lawful as regards the aim pursued under Protocol No. 1.

But we consider that the majority were wrong to find a breach in respect of the lawfulness of the interference on the grounds of lack of precision and foreseeability (paragraphs 40 to 42 of the judgment), thus indirectly criticising the quality of the law derived from enactments and case-law (see the Kruslin and Huvig v. France judgments of 24 April 1990, Series A no. 176-A and B). Foreseeability was ensured both by the applicable provisions and by the established notarial practice of informing vendors and purchasers before sales are concluded.

Equally wrongly, in our view, the majority found a breach in respect of proportionality (paragraphs 45 to 48 of the judgment). It looked at the possibility of arbitrariness in the proceedings and the risk run by any purchaser that he will be subject to pre-emption. These considerations were more relevant to foreseeability or the fairness of the trial than to proportionality.

The right of pre-emption is exercised through a selection of cases in which there have been the greatest underestimations of price on the property market. It is the lack of any judicial review of the selection criteria after a comparative survey which may amount to a breach.

The majority appears to have been influenced by considerations of good faith, fraud and formal exactness of the declaration of price. But in the French system there may be not an underestimation through fraud or through concealment of the price really paid but one which hides a benefit granted to the purchaser and which may, for example, be equated with a partially disguised gift, and this results in a failure to pay due registration fees. The right of pre-emption is therefore not exercised "for the sole purpose of warning others against any temptation to evade taxes".

It is obvious that the French procedure for exercising the right of pre-emption, before the change in the Court of Cassation ’ s case-law, was defective from the point of view of Article 6 (art. 6) of the Convention; in that respect it could be contrary to Protocol No. 1 taken together with Article 6 (P1, art. 6).

The right had virtually ceased to be exercised but the provision retained its effect of deterrence and of raising moral standards in the market.

The majority ’ s legitimate concern (paragraph 49 of the judgment) that a "fair balance ... should be struck between the protection of the right of property and the requirements of the general interest" was sufficiently met by the finding of a breach of Article 6 para . 1 (art. 6-1).

[*]  Note by the Registrar.  The case is numbered 23/1993/418/497.  The first number is the case's position on the list of cases referred to the Court in the relevant year (second number).  The last two numbers indicate the case's position on the list of cases referred to the Court since its creation and on the list of the corresponding originating applications to the Commission.

[*]  Note by the Registrar.  For practical reasons this annex will appear only with the printed version of the judgment (volume 296-A of Series A of the Publications of the Court), but a copy of the Commission's report is obtainable from the registry.