FOURTH SECTION
DECISION
AS TO THE ADMISSIBILITY OF
Application no. 19276/05
by ALLIANZ – Slovenská poisťovňa, a.s. and Others
against Slovakia
The European Court of Human Rights (Fourth Section), sitting on 9 November 2010 as a Chamber composed of:
Nicolas Bratza, President,
David Thór Björgvinsson,
Ján Šikuta,
Päivi Hirvelä,
Ledi Bianku,
Nebojša Vučinić,
Vincent Anthony de Gaetano, judges,
and Lawrence Early, Section Registrar,
Having regard to the above application lodged on 19 May 2005,
Having regard to the observations submitted by the respondent Government and the observations in reply submitted by the applicant companies,
Having deliberated, decides as follows:
THE FACTS
The applicants are the following six private insurance companies which were established under the laws of Slovakia in 1991, 1993, 1992, 1994, 1997 and 1991 respectively and have their registered seats in Bratislava (Slovakia): Allianz – Slovenská poisťovňa, a.s.; Česká poisťovňa - Slovensko, akciová spoločnosť; ČSOB Poisťovňa, a.s.; KOMUNÁLNA poisťovňa, a.s. Vienna Insurance Group; Generali Slovensko poisťovňa, a. s. and UNIQA poisťovňa, a.s.
The applicant companies were represented before the Court by Mr Ľ. Fogaš, a lawyer practising in Bratislava.
The Slovak Government (“the Government”) were represented by Ms M. Pirošíková, their Agent, and Ms M. Bálintová, Co-Agent.
A. The circumstances of the case
The facts of the case, as submitted by the parties, may be summarised as follows.
On 1 March 2002 Act no. 95/2002 Coll. on Insurance (“the Act”) came into force. The Act set an obligation for insurance companies doing business in the field of compulsory contractual insurance of liability for damage caused by the operation of motor vehicles to pay, on a yearly basis, 8 % of the premiums collected the previous year to the Ministry of the Interior (“the Ministry”). The Ministry would pass on those funds to certain bodies responsible for saving and protecting lives and property in road accidents such as fire brigades, rescue services and emergency hotlines.
On 2 December 2002 the applicant companies, who do business in the above-mentioned field, lodged an action against the Ministry with the Bratislava I District Court (Okresný súd). They requested that the District Court rule that they were not obliged to pay 8 % of the premiums they collected as stipulated by the Act. In their view the Act violated their property rights and the non‑discrimination principle guaranteed by the Constitution and the Convention.
On 15 October 2003 the District Court terminated the proceedings and stated that there was no other State organ to which the case could be transferred. It held that the relation between the parties was of a public-law nature and could not be considered civil or commercial, in which case it would be covered by the area of private law and the ordinary courts would have jurisdiction to examine it on the basis of the Code of Civil Procedure. No dispute over private-law matters was found to exist.
On 30 April 2004 the Bratislava Regional Court (Krajský súd) upheld the decision of the District Court following an appeal by the applicant companies. The view was expressed that the specific obligation had been imposed upon the applicants by legislation and no legal provision permitted ordinary courts to rule on the alleged non-conformity of legislation with the Constitution. That was a matter solely for the Constitutional Court (Ústavný súd) to examine in the context of a motion lodged under Article 125 of the Constitution by one of various specified State organs.
The applicants then claimed before the Constitutional Court, in a complaint under Article 127 of the Constitution, that they were not obliged to pay the above-mentioned contributions as the obligation had been imposed on them unconstitutionally. They further complained that the courts had refused to determine their claim.
On 15 December 2004 the Constitutional Court declared the complaint inadmissible for the applicant companies’ failure to exhaust ordinary remedies, in view of which the Constitutional Court lacked jurisdiction to consider the complaint. In particular, the Constitutional Court found that the applicant companies had failed to appeal against the decision of 30 April 2004 on points of law under Article 237 (f) of the Code of Civil Procedure, whereas that remedy was available to any party who had been “prevented from acting before a court as a result of the court’s conduct”.
On 30 April 2003 the Government passed a resolution proposing that section 30 of the Act be repealed, specifying in the explanatory report that this provision interfered with the insurance companies’ property in a discriminatory manner. The amendment was not adopted by the Parliament, however.
In 2008 a new Insurance Act was adopted which maintained the applicant companies’ obligation to pay 8 % of the premiums collected.
B. Relevant domestic law and practice
1. Insurance Act (Law no. 95/2002 Coll.), as in force until 30 March 2008
Section 30 (1) provided that insurance companies which did business in the field of compulsory contractual insurance of liability for damage caused by the operation of motor vehicles were obliged to pay to the Ministry, by the end of February, 8 % of the premiums for insurance in the above‑mentioned field collected in the preceding year. The insurance companies were obliged to report their fulfilment of this obligation to the National Bank of the Slovak Republic within three working days.
Section 30 (2) provided that the Ministry (of the Interior), after consulting the Ministry of Finance, would pass on these funds to fire brigades, departments of the Ministry (of the Interior), rescue services and emergency hotlines in order to meet the costs incurred in obtaining, maintaining and operating the material and facilities needed to research the causes of road accidents and to save and protect lives and property in road accidents.
2. Insurance Act (Law no. 8/2008 Coll.), as in force since 1 April 2008
In 2008 a new Insurance Act was adopted which replaced the relevant provisions of the 2002 Act. The obligation for the insurance companies to pay 8 % of the premiums collected on a yearly basis was maintained in section 33 of the 2008 Act. By 15 February each year the Ministry (of the Interior) is required to inform the Ministry of Finance about the use made of the contributions paid by the insurance companies. The Ministry (of the Interior) is also under an obligation to make this information public.
3. Act on Compulsory Contractual Insurance of Liability for Damage caused by the Operation of Motor Vehicles (Law no. 381/2001 Coll., as amended)
Section 3 imposes a duty to take out an insurance policy in respect of motor vehicles. With regard to domestic motor vehicles, this duty lies with the vehicle’s holder, owner, operator or lessee (sub-section 1). As to foreign motor vehicles, unless it is otherwise provided for, the person liable to arrange for the insurance of a vehicle is the vehicle’s driver (sub‑section 2). The duty to take out an insurance policy commences at the latest on the first day on which the motor vehicle is used (sub-section 3).
4. The Constitutional Court’s practice
The Constitutional Court has held on many occasions that an examination of complaints lodged by natural or legal persons under Article 127 of the Constitution cannot entail a review of the constitutionality of legislation (see, for example, decisions no. II. ÚS 40/00, no. II. ÚS 5/02, no. II. ÚS 238/03, no. III. ÚS 10/07 or no. IV. ÚS 124/07).
COMPLAINTS
1. The applicant companies complained under Article 6 § 1 of the Convention that the obligation to pay the contributions was not of a public-law nature and that, because it was impossible to have their claim examined at the domestic level, their right of access to a court was infringed.
2. The applicant companies also complained that they were deprived of their possessions contrary to Article 1 of Protocol No. 1. Under that provision, they also complained that the State failed to fulfil its positive obligation to ensure the compatibility of the laws intended to guarantee the effective exercise of the applicant companies’ right of property.
3. The applicant companies lastly alleged a violation of Article 14 of the Convention in that they were at a disadvantage compared to other persons engaged in business activities, as the applicant companies were the only ones who were under an obligation to pay the contributions in issue.
THE LAW
1. The applicant companies complained that their right to the peaceful enjoyment of their possessions was disregarded, in violation of Article 1 of Protocol No. 1, which reads as follows:
“Every natural or legal person is entitled to the peaceful enjoyment of his possessions. No one shall be deprived of his possessions except in the public interest and subject to the conditions provided for by law and by the general principles of international law.
The preceding provisions shall not, however, in any way impair the right of a State to enforce such laws as it deems necessary to control the use of property in accordance with the general interest or to secure the payment of taxes or other contributions or penalties.”
The Government considered that this part of the application was inadmissible due to non-exhaustion of domestic remedies or, alternatively, due to being belated and that, in any event, it was manifestly ill‑founded.
As to the exhaustion of domestic remedies, the Government relied on the finding of the Constitutional Court in its decision of 15 December 2004 to the effect that the applicant companies had failed to assert their arguments in an appeal on points of law under Article 237 (f) of the Code of Civil Procedure. Moreover, should that appeal have failed, it would have been open to the applicant companies to challenge that final decision of the ordinary courts in the Constitutional Court by way of a complaint under Article 127 of the Constitution.
In the event that the Court rejected the Government’s objection of non‑exhaustion of domestic remedies, the Government submitted that the application was lodged outside the six‑month time-limit. In particular, as the Government argued, if the premise was accepted that an appeal on points of law was not an effective remedy in respect of the statutory obligation on the part of the applicant companies to pay the contributions in question, it was an inescapable consequence that the statutory obligation could not be challenged in the ordinary courts. It would follow that there was no legal remedy in respect of that obligation and that, accordingly, the six-month time-limit had to be counted from the day when the law laying down the obligation was enacted.
As to the content of the complaint, the Government accepted that the insurance premiums collected by the applicant companies constituted possessions within the meaning of Article 1 of Protocol No. 1 and that the obligation to pay the contributions in question constituted an interference with the peaceful enjoyment of those possessions.
However, according to the Government, that interference was allowed by the second paragraph of Article 1 of Protocol No. 1, which authorised the States to enforce such laws as they deemed necessary to control the use of property in accordance with the general interest or to secure payment of taxes or other contributions. In that respect, the Government relied on the States’ wide margin of appreciation and acknowledged that it was limited by the imperative of striking a fair balance between general and individual interests and non-imposition of an excessive individual burden on those concerned.
At the factual level, the Government submitted that the market of insurance in respect of liability for damage caused by the operation of motor vehicles had been de-monopolised in Slovakia in that providing such insurance was no longer the domain of the State but the business of commercial insurers such as the applicant companies. Nevertheless, such insurance had a social dimension in that it was aimed at ensuring the legal protection of and compensation for victims of road traffic accidents, which was a public-service function of the State.
The Government pointed out that the State on its part had set up an arrangement whereby there was a legal duty on owners and users of motor vehicles to take out insurance in respect of their vehicles. This arrangement provided a guaranteed clientele to the applicant companies as the insurance providers.
The Government drew attention to the fact that road traffic accidents were a sad reality and that someone had to bear the costs associated with them. It was only fair that such costs were to be borne by the owners and users of motor vehicles. Under the arrangement in place the owners and users of motor vehicles were duty-bound to insure their vehicles and a portion of the insurance premium paid by them was transmitted to the agencies responsible for rescue and other vital services. The insurance providers had the possibility, which they were in reality using, to take the contributions payable to the Ministry into account when calculating the insurance premiums. Therefore, it was the insured who ultimately made up for the contributions in question.
In conclusion, the Government considered that it was fair to impose certain statutory obligations on the applicant companies in return for providing them with a secured market and that the burden of those obligations was not excessive.
The applicant companies disagreed on all counts. Although they admitted that, in principle, that they could have appealed on points of law, they contended that in a concrete case that remedy would only be available in respect of individual legal acts or omissions and not, as in their case, in respect of legislation. In support of that view they referred to the clear and concordant conclusions of the ordinary courts at two levels of jurisdiction to the effect that there was no legal basis for them to entertain the applicant companies’ action. In addition, they emphasised that there was no legal means for them to make the ordinary courts use their discretionary power to have the contended legislation reviewed by the Constitutional Court.
The applicant companies argued that the above had no impact on the Constitutional Court’s decision of 15 December 2004 being the final decision in their case. To that end, they contended that it would be absurd not to have any remedies to try at the domestic level and thereby to have direct unconditional access to the European Court.
As to the substance, the Government submitted that it was unclear what the legal quality of the contributions in question and the legal nature of their relationship to the Ministry were as, under domestic law, the contributions fell in the category of neither taxes nor dues and no contractual or tort liability on their part was involved. Moreover, it was ambiguous whether the Ministry was merely an administrator of the contributions or whether it had another legal position in respect of them. The contributions therefore appeared to have a sui generis unsystematic and disorderly basis.
Lastly, the applicant companies emphasised that the legal duty to pay the contributions was directly imposed on them and that, in a market economy, the possibilities of shifting this burden onto the insured was limited.
In sum, the applicant companies argued that the complaint was admissible and well-founded.
The Court observes that there is disagreement between the parties as to whether the applicant companies have complied with the exhaustion of domestic remedies requirement and the six-month time-limit pursuant to Article 35 § 1 of the Convention.
In that respect, the Court observes that the Act which imposed the contested duty was originally enacted with effect as from 1 March 2002 and then replaced by the legislation of 2008. The duty to pay contributions under the Act has been of a standing nature in that the applicant companies have been compelled to pay, on a yearly basis, variable amounts equal to a certain portion of the calculation base.
The Court notes the continuous nature of the impugned duty (see Urbárska Obec Trenčianske Biskupice v. Slovakia, no. 74258/01, §§ 92 and 93, ECHR 2007‑XIII (extracts), with further references and Staniszewski v. Poland (dec.), no. 53655/00, 6 October 2005) but considers that it is not necessary to come to a conclusion on the Government’s objections under Article 35 § 1 of the Convention because, in any event, the complaint is inadmissible for the following reasons.
The Court finds that the obligation to pay the contributions under the Act amounts to an interference with the applicant companies’ right to the peaceful enjoyment of their possessions and that, consequently, Article 1 of Protocol No. 1 is applicable in the present case. It must therefore examine whether the interference was justified.
The Court notes that the second paragraph of Article 1 of Protocol No. 1 provides that States may levy taxes or other contributions. A financial liability arising out of the raising of taxes or contributions may adversely affect the guarantee secured under Article 1 of Protocol No. 1 if it places an excessive burden on the person or entity concerned or fundamentally interferes with his, her or its financial position. However, it is in the first place for the national authorities to decide what kind of taxes or contributions are to be collected. Furthermore, decisions in this area will commonly involve the appreciation of political, economic and social questions which the Convention leaves within the competence of the Contracting States. The margin of appreciation of the Contracting States is therefore a wide one (see, mutatis mutandis, James and Others v. the United Kingdom, 21 January 1986, § 46, Series A no. 98; Baláž v. Slovakia (dec.), no. 60243/00, 16 September 2003; and Frátrik v. Slovakia (dec.), no. 51224/99, 25 May 2004).
The Court notes that the legal basis of the impugned duty and its legitimate aim have not been disputed. The former lies in the Act while the latter is linked to the public function of the State to ensure safety and protection of lives and property in road traffic.
The Court thus accepts that the interference with the applicant companies’ property rights was lawful and pursued a legitimate aim “in accordance with the general interest”. It remains to be ascertained whether the interference was proportionate.
To that end the Court observes that under the 2001 Act on Compulsory Contractual Insurance of Liability for Damage caused by the Operation of Motor Vehicles all owners and users of motor vehicles in Slovakia have a duty to insure their vehicles against the risks which are inherent in road traffic. The Court further notes that, under the Act, 8 % of the premiums of such insurance has to be transmitted – via the Ministry – to entities providing emergency, rescue and other vital road-traffic related services.
The Court also takes note of the fact that the duty to transfer 8 % of the collected premiums is imposed not only on the applicant companies but on all providers of insurance for liability for damage caused by the operation of motor vehicles and only in respect of premiums collected for providing this specific type of insurance.
The Court also observes that no specific facts or arguments have been submitted allowing it to establish, by means of calculation or other verifiable assessment, that the scope of the duty under the Act is prohibitive, oppressive or otherwise disproportionate.
In view of the above and in so far as the complaint has been substantiated, the Court finds no elements to support a conclusion that the duty to make the payments under the Act should be considered as being contrary to the applicant companies’ right Article 1 of Protocol No. 1.
It follows that the complaint under Article 1 of Protocol No. 1 is manifestly ill-founded and must be rejected in accordance with Article 35 §§ 3 and 4 of the Convention.
2. The applicant companies complained that they lacked access to a court in violation of Article 6 § 1 of the Convention, the relevant part of which provides as follows:
“In the determination of his civil rights and obligations ... everyone is entitled to a fair ... hearing ... by [a] ... tribunal ...”
The Government pursued a similar line of reasoning as in respect of the complaint under Article 1 of Protocol No. 1 in that the applicant companies had had the benefit of legal protection before the ordinary courts at three levels of jurisdiction, including the opportunity to appeal on points of law, which the applicant companies had failed to use.
The applicant companies disagreed and emphasised, in particular, that an appeal on points of law was in all likelihood not a remedy capable of providing them redress in their specific situation.
The Court observes that the “civil rights and obligations” at stake in the present case are the applicant companies’ property rights and that, in the essence of things, the interference with these rights originates directly from legislation. This is reflected, inter alia, in the scope and aim of the applicant companies’ civil action of 2 December 2002 whereby they sought a ruling declaring that they were not subject to the duty under the Act as the duty breached their property rights and was discriminatory.
However, neither Article 6 nor any other provision of the Convention guarantees, as such, a right of access to a court with the power to invalidate or override a law enacted by the legislature (see, for instance, Ruiz-Mateos and Others v. Spain, application no. 14324/88, Commission decision of 19 April 1991, DR 69, p. 227, and Jenisová v. Slovakia (dec.), no. 58764/00, 12 September 2006).
It follows that the complaint made in reliance on Article 6 § 1 of the Convention is incompatible ratione materiae with the provisions of the Convention within the meaning of Article 35 § 3 and must be rejected in accordance with Article 35 § 4.
3. The applicant companies complained that they were discriminated against in relation to other persons conducting business in that it was only the applicant companies who had to pay the contributions in issue. They relied on Article 14 of the Convention, which reads as follows:
“The enjoyment of the rights and freedoms set forth in [the] Convention shall be secured without discrimination on any ground such as sex, race, colour, language, religion, political or other opinion, national or social origin, association with a national minority, property, birth or other status.”
The Government disagreed and pointed out that the applicant companies were in a different situation to other entrepreneurs in that they were in an exclusive position to provide insurance in respect of liability for damage caused by the operation of motor vehicles, and such an exclusive position went hand in hand with certain advantages and disadvantages.
The applicant companies submitted that there were a number of other areas and activities, such as, for example, the exercise of the legal profession, which were subject to mandatory contractual insurance. However, there was no similar duty to pay contributions in respect of any other type of comparable insurance.
The Court reiterates that Article 14 of the Convention complements the other substantive provisions of the Convention and the Protocols. It has no independent existence since it has effect solely in relation to “the enjoyment of the rights and freedoms” safeguarded by those provisions (see, among many other authorities, Gaygusuz v. Austria, no. 17371/90, § 36, ECHR 1996-IV).
In the present case the Court considers that the applicant companies’ complaint under Article 14 of the Convention most naturally falls to be examined in conjunction with Article 1 of Protocol No. 1.
The Court further reiterates that the right under Article 14 not to be discriminated against in the enjoyment of the rights guaranteed under the Convention is violated when States treat differently persons in analogous situations without providing an objective and reasonable justification or when States without an objective and reasonable justification fail to treat differently persons whose situations are significantly different (see, among many other authorities, Thlimennos v. Greece [GC], no. 25735/94, § 44, ECHR 2000-IV).
In the present case, the applicant companies argued that they were in an analogous situation to other entrepreneurs and were treated differently in that they had to make contributions under the Act.
The Court observes at the outset that the applicant companies’ situation would appear to be different from that of other entrepreneurs, including insurers who do not provide road accident insurance. It notes that in providing this specific type of insurance the applicant companies have the advantage of a secure market. This exclusive advantage stems from the fact that all road users are obliged by law to take out such insurance.
The Court also observes that every provider of insurance in the given market is subject to the same regime as the applicant companies.
Nevertheless, even assuming that the applicant companies could be considered to be in a relevantly similar situation to that of other entrepreneurs, the Court considers that the reasons it has given for disposing of the applicant companies’ complaint under Article 1 of Protocol No. 1 are of themselves sufficient for a finding that there exists objective and reasonable justification for any difference of treatment.
It follows that the remainder of the application is manifestly ill-founded and must be rejected in accordance with Article 35 §§ 3 and 4 of the Convention.
For these reasons, the Court unanimously
Declares the application inadmissible.
Lawrence EarlyNicolas Bratza
RegistrarPresident
Full & Egal Universal Law Academy