JOINT DISSENTING OPINION OF JUDGES LEMMENS, DEDOV AND PAVLI

1. To our regret, we are unable to agree with the majority’s finding of a violation of Article 4 of Protocol No. 7 to the Convention. In our opinion, the Supreme Court correctly concluded that the existence of two separate proceedings did not violate the principle of “ ne bis in idem ”.

We agree with the majority that both sets of proceedings concerned a “criminal” offence, within the autonomous meaning of Article 4 of Protocol No. 7, and that the criminal offence for which the applicant was prosecuted and convicted was the same as that for which the tax surcharges had been imposed. We also agree that the issue as to whether or not there was a final decision in the tax proceedings is devoid of relevance in the present case.

Our disagreement concerns the question whether there was a duplication of the proceedings (the “ bis ” element of the “ ne bis in idem ” principle) (see paragraphs 55-77 of the judgment).

2. At the outset, we wish to express our agreement with the general principles set out in A and B v. Norway ([GC], nos. 24130/11 and 29758/11, § 130, 15 November 2016) and reiterated in paragraph 55 of the present judgment. In particular, we agree that, for the Court to be satisfied that there is no duplication of trial or punishment as proscribed by Article 4 of Protocol No. 7, the respondent State must demonstrate convincingly that the dual proceedings in question have been “sufficiently closely connected in substance and in time” or, in other words, that both proceedings have been combined in an integrated manner so as to form “a coherent whole”.

Connection in substance

3. Turning, first, to the connection in substance between the tax proceedings and the criminal proceedings in the present case, we agree with the majority that the two sets of proceedings pursued a complementary purpose (see paragraph 60 of the judgment). It seems to us, however, that the majority do not attach appropriate weight to this aspect of the test, which in our opinion is of crucial importance.

We would recall that the tax surcharge was imposed because of the filing of incorrect tax returns (see section 108, second paragraph, of the Income Tax Act). The applicant was further charged with the criminal offence of making false or misleading statements “intentionally or through gross negligence” (section 109, first paragraph, of the Income Tax Act), with the aggravating circumstance that the offence was a “major” one (Article 262, paragraph 1, of the General Penal Code). We therefore agree with the Supreme Court that the “proceedings pursued by the tax authorities [were] aimed at revealing other factors than those investigated by the police and adjudicated by the courts” (see paragraph 23).

There is a remarkable correspondence between the statutory provisions that were applied in the applicant’s case and those that were applied in the Norwegian cases of A and B. With respect to the latter, the Court observed that “the administrative penalty of a tax surcharge served as a general deterrent, as a reaction to a taxpayer’s having provided, perhaps innocently, incorrect or incomplete returns or information”, whereas the “criminal conviction ... served not only as a deterrent but also had a punitive purpose in respect of the same anti-social omission, involving the additional element of the commission of culpable fraud” (see A and B v. Norway , cited above, § 144). We find that a similar assessment can be made in the applicant’s case.

We find, moreover, that the Icelandic legislature had good reasons to opt for “[the regulation of] the socially undesirable conduct of non-payment of taxes in an integrated dual (administrative/criminal) process”, and that the competent authorities had good reasons to choose, in the applicant’s case, “to deal separately with the more serious and socially reprehensible aspect of [intentionally or through gross negligence making false or misleading statements] in a criminal procedure rather than in the ordinary administrative procedure” (see A and B v. Norway , cited above, § 146; see also ibid., § 152).

4. Furthermore, like the majority, we are of the opinion that the conduct of dual proceedings, with the possibility of different cumulated penalties, was foreseeable for the applicant (see paragraph 61 of the judgment). Apart from the legislative framework, which made it clear that the failure to provide accurate information in a tax return could lead to tax surcharges as well as to criminal sanctions, the applicant was from the outset explicitly informed of the possibility, or even the likeliness, of criminal proceedings, in addition to the tax proceedings, and he was also informed, at an early stage, of the actual reference of his case by the tax authorities to the Office of the Special Prosecutor (see paragraphs 7, 14 and 61; compare A and B v. Norway , cited above, §§ 146 and 152).

5. The majority consider that “the apparent overlap in the two investigations in the present case is considerable” (see paragraph 64 of the judgment) and therefore “[harbour] serious doubt as to whether the two sets of proceedings were conducted so as to avoid, to the extent possible, duplication in the obtaining and assessment of evidence” (see paragraph 65).

On this point, we respectfully disagree.

As acknowledged by the majority, “it is clear that the prosecutor had access to the report issued by the Directorate of Tax Investigations and its annexes, as well as to the correspondence between the applicant and the Directorates of Tax Investigation and Internal Revenue (including the applicant’s objections to the planned criminal proceedings)” (see paragraph 62). The prosecutor nevertheless also undertook his own investigation. It is true that he interviewed the applicant twice, and that he also interviewed the one witness who had previously been questioned by the Directorate of Tax Investigations. However, he also questioned three additional witnesses who had not previously been questioned by the Directorate (see paragraph 64). As the Supreme Court underlined, the prosecutor’s investigation “had been aimed primarily at [uncovering] whether the applicant’s alleged offences had been major, whether they had been carried out with intent or gross negligence, and whether persons other than the applicant had been involved” (see paragraph 24).

We find it difficult to conclude, in these circumstances, that the overlap in the two investigations was “considerable”. Rather, we find that the two sets of proceedings were interconnected: on 12 November 2012 the tax audit report was forwarded to the Office of the Special Prosecutor (see paragraph 14 of the judgment) and the prosecutor’s indictment of 21 May 2014 was obviously based on the State Internal Revenue Board’s ruling of 12 March 2014 revising upwards the applicant’s income and re-assessing the applicant’s tax liability accordingly (see paragraphs 12 and 16). The chronology of the facts thus makes it clear that the establishment of facts made in the tax proceedings, in particular the finding that the applicant had submitted incorrect tax returns, was relied upon in the criminal proceedings (compare A and B v. Norway , cited above, §§ 146 and 152; see also Matthildur Ingvarsdóttir v. Iceland (committee) (dec.), no. 22779/14, § 59, 4 December 2018, and, a contrario , Jóhannesson and Others v. Iceland , no. 22007/11, § 53, 18 May 2017). In short, the criminal investigation built on the findings in the tax proceedings: while the applicant’s failure to file correct tax returns was established in the tax proceedings, it was on the basis of that finding that the criminal investigation examined the further question whether the offences had been carried out with intent or gross negligence. There was therefore an “adequate” “interaction” between the two proceedings (compare Bajćić v. Croatia , no. 67334/13, § 43, 8 October 2020).

The mere fact that the applicant and one of the witnesses were interviewed both by the tax authorities and by the prosecutor is, in our opinion, not enough to conclude that there was no sufficiently close connection in substance between the two sets of proceedings.

6. Finally, we note that the majority admit that the sanctions imposed in the tax proceedings were taken into sufficient account at the sentencing stage of the criminal proceedings (see paragraph 66 of the judgment; compare A and B v. Norway , cited above, §§ 146 and 152). We agree.

In our opinion, this is a very important feature of the second set of proceedings, since it ensures “that the overall amount of [the] penalties imposed is proportionate” (see A and B v. Norway , cited above, § 132).

Connection in time

7. Turning, next, to the connection in time between the tax proceedings and the criminal proceedings, we note that the majority, following the approach adopted by the Supreme Court (see paragraphs 25-31 of the judgment), place great emphasis on the overall length of the two sets of proceedings (see paragraphs 69-72) and on the duration of the criminal proceedings after the ruling in the tax proceedings had become final (see paragraphs 73-75).

On this point, again, we respectfully disagree.

The connection in time is not a matter of the duration of proceedings, even if the requirement of a close connection in time is intended “to protect the individual from being subjected to uncertainty and delay from proceedings becoming protracted over time” (see A and B v. Norway , cited above, § 134). It is the temporal connection between the two proceedings that matters.

8. In our opinion, there was indeed a close connection in time.

At a point when the tax proceedings were ongoing, the Directorate of the Tax Investigations referred the case to the Office of the Special Prosecutor (see paragraph 14 of the judgment). The prosecutor undertook his own investigation while the tax proceedings were still ongoing (see paragraph 15). As soon as the tax proceedings had come to an end, the prosecutor indicted the applicant and filed the case with the District Court (see paragraph 16). In our view, this sequence of events is indicative of a close connection in time between the two sets of proceedings.

It is true that the criminal proceedings then proceeded for a further three years and four months, until the Supreme Court’s judgment of 21 September 2017. While this is a lengthy period, we do not think that it suffices to sever the close connection in time established at the outset between the two sets of proceedings.

Overall conclusion

9. For the reasons set out above, we are of the opinion that, “whilst different sanctions were imposed by two different authorities in different proceedings, there was nevertheless a sufficiently close connection between them, both in substance and in time, to consider them as forming part of an integral scheme of sanctions” for failure to declare income on tax returns correctly (see, mutatis mutandis , A and B v. Norway , cited above, § 147; see also ibid., § 153, and Matthildur Ingvarsdóttir , cited above, § 64).

Accordingly, we conclude that there has been no violation of Article 4 of Protocol No. 7.