CASE OF ÄRZTEKAMMER FÜR WIEN AND DORNER v. AUSTRIA

FOURTH SECTION

CASE OF ÄRZTEKAMMER FÜR WIEN AND DORNER

v. AUSTRIA

(Application no. 8895/10)

JUDGMENT

STRASBOURG

16 February 2016

FINAL

16/05/2016

This judgment has become final under Article 44 § 2 of the Convention. It may be subject to editorial revision.

In the case of Ärztekammer für Wien and Dorner v. Austria,

The European Court of Human Rights (Fourth Section), sitting as a Chamber composed of:

András Sajó, President,
Vincent A. De Gaetano,
Nona Tsotsoria,

Krzysztof Wojtyczek,
Egidijus Kūris,
Iulia Antoanella Motoc,
Gabriele Kucsko-Stadlmayer, judges,
and Fatoş Aracı, Deputy Section Registrar,

Having deliberated in private on 26 January 2016,

Delivers the following judgment, which was adopted on that date:

PROCEDURE

1. The case originated in an application (no. 8895/10) against the Republic of Austria lodged with the Court under Article 34 of the Convention for the Protection of Human Rights and Fundamental Freedoms (“the Convention”) by Ärztekammer für Wien (“the first applicant organisation”) and Mr Walter Dorner, (“the second applicant”), on 3 February 2010.

2. The applicants were represented by Mr G. Korn, a lawyer practising in Vienna. The Austrian Government (“the Government”) were represented by their Agent, Ambassador H. Tichy, Head of the International Law Department at the Federal Ministry for European and International Affairs.

3. The applicants complained that the injunction imposed on them which prohibited them from publicly repeating certain statements concerning the F. company had violated their rights under Article 10.

4. On 4 September 2013 the application was communicated to the Government.

THE FACTS

I. THE CIRCUMSTANCES OF THE CASE

5. The first applicant organisation is the Vienna Chamber of Medical Doctors (Ärztekammer für Wien). The Chamber represents all medical practitioners in Vienna and also has its own website. The second applicant was the Chamber’s president at the time of the events.

A. Statement in issue and injunction proceedings

6. On 18 January 2007 the second applicant published a letter on the first applicant organisation’s website, which was addressed to all members of the Chamber in Vienna and was also sent out to all of them via e-mail. The letter was titled “Locust funds want to take over medical practices” (“Heuschreckenfonds wollen Ordinationen übernehmen”). The second applicant went on to state that he had been forced to write to his colleagues for a serious reason, namely, because it had been reported in the media that the F. company planned to go into “the radiology business”. He added that share-bidding companies planned to offer medical services – initially in the area of radiology, but soon enough in other areas of the profession as well ‑ and that doctors risked becoming mere employees of such “locust” companies. If they would not act according to the companies’ wishes, they would be dismissed. The second applicant then explained the assumed legal and organisational basis of such a plan: radiology services which were currently being provided by medical practices could, in future, also be offered by limited companies. Shares of those companies could then be bought by the F. company, and the “locusts” would reach their goal, namely control of the medical profession. Giving an example of a risky development, the second applicant stated that in the last 20 years, colleagues had founded laboratories which had reciprocal agreements with certain health insurance boards. Today, almost all of those laboratories were owned by the F. group, which, in turn, was owned by insurance companies, investment funds and foundations, and which employed a large number of doctors. The second applicant ended his letter by stating that he could guarantee one thing: that the doctors’ professional representative body would make use of all legal and political means available to stop such a disastrous development from going ahead, to prevent that the quality of medical treatment being determined by “managers and controllers” and to ensure, inter alia, that existing medical practices were protected from the competition from “international locust funds” (“internationale Heuschreckenfonds”).

7. On 24 January 2007 the F. company lodged an action against the two applicants and an application for an injunction with the Vienna Commercial Court (Handelsgericht Wien). The applicants contested the application.

8. On 16 February 2007 the Vienna Commercial Court issued an injunction prohibiting the applicants (each of them individually) from repeating the statement that the F. company was ruthless towards third parties, in particular medical professionals. The injunction prevented the applicants from referring to the F. company as a “locust”, “locust company” or “locust fund”. The applicants were further prohibited from stating that the provision of services by the F. company, particularly services in the area of radiology, was a disastrous development. The court found that there was a competitive relationship between the F. company and the applicants, and found the statements made by the applicants to be defamatory under Article 1330 of the Civil Code and unethical under the Unfair Competition Act (Bundesgesetz gegen den unlauteren Wettbewerb).

9. The applicants appealed against the injunction. On 30 October 2007 the Vienna Court of Appeal (Oberlandesgericht Wien) partly granted the appeal, and prohibited the applicants from alleging that the F. company was ruthless towards third parties and medical practitioners, and from calling it, inter alia, a “locust company”. However, it dismissed the F. company’s application to prohibit the applicants from calling its provision of services a “disastrous” development. The Court of Appeal found that the first applicant organisation had locus standi in the injunction proceedings. The Chamber of Medical Doctors held official authority status in relation to certain areas of its work (Bereich der Hoheitsverwaltung), in addition to representing the interests of its members; it was therefore considered a legal entity under the Official Liability Act (Amtshaftungsgesetz). However, when acting as a special interest group, it represented its members’ interests from a mainly economic perspective, rather than acting in its capacity as an official authority. According to the Court of Appeal, the letter in issue pursued the interests of the Chamber’s members, outside the Chamber’s official sphere of activity.

10. The Court of Appeal further established, referring inter alia to Wikipedia, that the term “locust company“ (“Heuschreckenunternehmen“) was introduced into the political discussion in German speaking countries in 2005 by Mr Franz Müntefering, a German politician, and is ever since used in political debates as a pejorative term for private-equity companies or other forms of capital funds with short-term or exaggerated return expectations – like hedge funds or „vulture“ funds, which also had negative connotations. The domestic court found that there was a need to balance the interests involved in the present debate, reiterating that extreme opinions were only unlawful if they were excessive. As a result of that balancing exercise, the Court of Appeal found that the “locust” statement had to be considered a lawful criticism in the context of a public debate, and that the F. company could therefore not base its claim on Article 1330 of the Civil Code. However, the Court of Appeal classified the applicants’ actions as competitive in nature. Statements of fact made in violation of the Unfair Competition Act could not be justified by the right to freedom of expression. The Court of Appeal found that Austrian law provided wide‑ranging protection for commercial and economic interests. Those who published an opinion in an economically competitive context were obliged to exercise a higher level of diligence with regard to the facts and bases of their allegations than those who acted in the non-competitive context of a public debate of general interest. Therefore, the Court of Appeal upheld the injunction decision with regard to the statements about the “locust company”.

11. However, as regards the further statement, namely that provision of certain services by the F. company was a “disastrous development”, the Court of Appeal found that, read in context, the statement indicated a general assessment and did not refer to a particular service of the F. company. It was therefore to be considered a personal opinion, and thus a value judgment that was not defamatory under Article 1330 of the Civil Code. It also did not fall under section 7 of the Unfair Competition Act.

12. The applicants lodged an extraordinary appeal with the Supreme Court (Oberster Gerichtshof). On 22 January 2008 the Supreme Court dismissed the extraordinary appeal. It acknowledged the applicants’ argument that where a competitor, even for economic purposes, took part in a debate of public interest, freedom of expression had to hold more weight in the balancing test. However, the Supreme Court observed that the applicants had made their statement in the clearly economic context of competition between medical practitioners and companies which provided the same services. The applicants could have warned their members of the possible risks of cooperating with companies without overstepping the margin of acceptable criticism. However, the applicants had exceeded that limit and stated that the F. company was a “locust”. That statement was one of fact, and the applicants had not provided evidence of a factual basis for their allegations, and had therefore exceeded the permissible limitations of freedom of expression.

B. Substantive proceedings

13. On 7 July 2008 the Commercial Court gave its judgment in the substantive proceedings and ordered the applicants to refrain from: repeating the statement that the F. company was ruthless towards third parties, in particular medical practitioners and patients; and stating that the F. company was a “locust company”, a “locust fund” or a “locust”. It further ordered the applicants to publish and display the operative part of the judgment on the first applicant organisation’s website for thirty days, and to publish it in the first applicant organisation’s print newsletter.

14. The Commercial Court made substantial reference to the Court of Appeal’s reasoning in the interim injunction proceedings. It followed the previous finding that the relevant statements did not constitute defamation pursuant to Article 1330 of the Civil Code. Examining the statements in relation to the provisions of the Unfair Competition Act, the Commercial Court found that the letter had been written by the Chamber of Medical Doctors in a commercial and not a political context. It had also had the advancement of independent medical practices as an objective, and had contained a warning regarding capital ventures which allegedly threatened doctors’ independence. The Commercial Court found the relevant comparisons with “locusts” to be statements of fact regarding both the F. company and its conduct in relation to third parties, doctors and patients. The statements were also likely to damage the F. company’s commercial interests, and had not been proved to be true.

15. The used language could also not be justified with a reference to the right to freedom of expression as the statement was uttered within the framework of a commercial competitive relationship. With reference to the Court’s case-law allowing for a wider margin of appreciation under Article 10 of the Convention with regard to commercial language, the Commercial Court observed that a competitor was required to be more diligent in the context of commercial communication among competitors. The term “locust” was almost exclusively loaded with negative meaning, which led to the unethical general vilification of a competitor. The applicants were therefore prohibited from using that statement in relation to the F. company, pursuant to the Unfair Competition Act.

16. On 19 September 2008 the applicants lodged an appeal against that judgment. On 12 December 2008 the Vienna Court of Appeal dismissed the appeal as unfounded. It referred to the extensive reasoning given in the interim injunction proceedings and added that, according to the case-law of the Supreme Court, the test used to verify whether a statement was covered by the right to freedom of expression required the assessment of whether a factual basis for such a statement existed; if a competitor participated in a public debate of general interest, freedom of expression had more weight with regard to the assessment of the statement than in the context of purely commercial communication. The greater the public interest in being properly informed and the less the statement related to commercial interests, the more the statement would be protected by Article 10 of the Convention. In the present case, there was no doubt that there was an ongoing public debate; however, the commercial interests of the applicants had very much been in the foreground of the communicated statement itself.

17. The applicants lodged an extraordinary appeal on points of law against that judgment, which was rejected by the Supreme Court on 14 July 2009. The Supreme Court found that the applicants had not only called the F. company a “locust”, but had also reproached this company for negative conduct, such as dominating doctors, dismissing doctors who did not act in accordance with company wishes, and focusing on economic factors rather than the welfare of patients (“Herrschaft über den ärztlichen Berufstand, Kündigung nicht “spurender” Ärzte, Orientierung an ökonomischen Erwägungen und damit nicht am Wohl der Patienten”). Therefore, the expression used had turned into a statement of fact, giving the reader the impression that the F. company had already demonstrated unethical conduct which threatened the interests of doctors and patients. In view of the specific circumstances of the case, the prohibition ruled upon by the lower courts was justified. Even though the applicants had taken part in a debate of general public interest, an untrue and damaging statement of fact was not protected by freedom of expression. Furthermore, the issuing of warnings concerning the potential risks of the provision of medical services by companies was not, as such, prohibited by the decisions of the Austrian courts; the applicants had only been required to refrain from making untrue statements of fact in respect of their competitors.

18. The decision of the Supreme Court was served on the applicants’ counsel on 27 August 2009.

II. RELEVANT DOMESTIC LAW

A. The Chamber of Medical Doctors and the Medical Practitioners Act

19. According to Article 120a of the Federal Constitution Act (Bundesverfassungsgesetz), people may be united by law to self‑administrating bodies to autonomously take care of public interests being in their exclusive or preponderant common interest and qualified to be handled jointly by them. The self-administrating bodies are authorized to take care of their tasks in own responsibility without orders and to render statutes within the frame of the laws. The Federation or the Region has a right of supervision over them on the basis of the legal regulations with regard to the legality of the handling of the administration. Such right of supervision may also extend to the expedience of the handling of the administration, if such is required because of the tasks of the self‑administrating body. Upon the self-administrating bodies tasks of administration of the state may be conferred. The laws have to expressly indicate that such matters belong to the assigned executive responsibility and to provide a binding effect of the instructions by the supreme administrative authorities (see Article 120b of the Federal Constitution Act).

20. Using the authority granted by these provisions of the Federal Constitution Act, the Medical Practitioners Act (Ärztegesetz), establishes the Chamber of Medical Doctors (“the Chamber”) to represent the interests of medical practitioners in Austria (Standesvertretung). There is a regional chamber in each of the nine Austrian regions and a Federal Chamber, of which the regional chambers are members. The chambers are public-law bodies with compulsory membership. The members are all practising doctors who are registered on the list of active medical practitioners in the geographical area of the regional chambers.

21. The chambers are established to represent and promote the professional, social and economic interests of doctors; uphold the reputation of the medical profession; and ensure that professional duties are observed by practitioners.

22. Furthermore, inter alia, they manage the examinations which medical graduates have to pass in order to become practising doctors (sections 7 et seq. of the Medical Practitioners Act); confer institution status on medical education establishments (sections 9 et seq.); and deal with the recognition of foreign qualifications and access to work for both self‑employed and employed doctors (sections 27 et seq.). These duties and responsibilities are divided between the regional chambers and the Federal Chamber, and are regulated by sections 65 et seq. (in relation to the regional chambers) and sections 117 et seq. of the Medical Practitioners Act (in relation to the Federal Chamber).

23. Section 66 (sections 66 to 66c after 1 January 2010) of the Medical Practitioners Act provides that, within their own sphere (eigener Wirkungsbereich), the regional chambers are called upon to, inter alia, form and terminate contracts which define the relationship between medical practitioners and social security institutions; secure collective agreements on the part of employers in relation to non-medical employees; control fees; give legal advice; make reports, expert opinions and recommendations to state authorities concerning the health system, establish regional collegiate arbitration boards and conduct collegiate arbitration proceedings; establish patient arbitration boards; establish and manage pension and disability funds for their members; establish and manage commercial institutions; report on public health issues; collaborate in the collection of official medical statistical data; collaborate in the establishment of medical universities and other training institutes; examine draft laws; provide quality control for medical training; provide advanced training and training facilities; and provide quality control for services rendered by the medical profession in general.

24. The Federal Medical Chamber (Österreichische Ärztekammer), inter alia, manages the register of practising doctors; deals with the accreditation process for equivalent medical qualifications; issues diplomas for general practitioners, medical specialists or specialists in other fields; collaborates in the academic and advanced education and training of medical practitioners; and conducts disciplinary proceedings. Section 27 of the Medical Practitioners Act provides that the regional chambers cooperate with the Federal Chamber in managing the register of doctors. Appearing on this register is a precondition to working legally as a medical doctor in Austria.

25. The regional chambers adopt their own organisational statutes; statutes relating to pension and disability funds; rules on contributions to the chambers themselves and to pension and disability funds; recommendations regarding fee structures for private medical services; and rules on the reimbursement of costs and other fees.

26. The members are obliged to pay regular contributions (Umlage) to their chambers and to the relevant pension and disability funds (section 69 of the Medical Practitioners Act). These contributions are defined by decree of the regional chambers on the basis of section 91. Payment of arrears of such contributions can be enforced by the chambers on the basis of the federal law for enforcement of administrative orders (Verwaltungsvollstreckungsgesetz).

27. Until 2010, remedies against decisions of the chambers could, depending on the issue, be raised before the Regional Governor (Landeshauptmann – sections 14, 15, 28, 59 and 197), the Independent Administrative Panel (Unabhängiger Verwaltungssenat – sections 35a and 39) or, in respect of decisions relating to pension and disability funds and disciplinary proceedings, with the Federal Chamber. Between 1 January 2010 and 31 December 2013 the rule providing for appeals to the Regional Governor was abolished. In proceedings concerning the recognition of foreign qualifications (sections 32, 33 and 35), there was the possibility of an appeal to the Independent Administrative Panel. With regard to decisions relating to pension and disability funds and disciplinary proceedings, the rule permitting appeals to the Federal Chamber remained in force. As of 1 January 2014 an appeal to the Regional Administrative Courts can be filed against all decisions of the chambers.

28. The regional chambers are supervised by the regional governments, the Federal Chamber by the Federal Minister of Health. To fulfil this supervisory function, the chambers have to provide information needed by regional governments or the Federal Minister of Health. All decrees have to be presented for supervision automatically. The supervisory body has to examine the lawfulness of the decrees and decisions issued by the chambers, and can suspend unlawful acts (sections 195 et seq.). If an organ of the chamber oversteps its competences or neglects its duties, the regional government may dismiss this organ from office, if this organ acted with culpable negligence or wilful intent and the chamber does not take appropriate measures. If the chamber becomes inquorate, the regional government may depute a commissioner of the Government (Regierungskommissär) to administrate the acts of the chamber until the establishment of a new board of the chamber through elections (see section 195b).

29. In accordance with Article 127b of the Federal Constitution, the Audit Office (Rechnungshof) examines the finances of the chambers and verifies that all their transactions are lawful, appropriate and in line with relevant budgets. It reports to the chambers themselves and to the supervisory bodies.

30. Apart from the public responsibilities described above, medical chambers can act as private entities. They may form all manner of civil contracts and acquire possessions. In this field, they can be held liable for violations of laws, in the same way as any private entity.

B. Article 1330 of the Civil Code and section 7 of the Unfair Competition Act

31. Article 1330 of the Civil Code (Allgemeines Bürgerliches Gesetzbuch) provides as follows:

“1. Anybody who, as a result of defamation, suffers real damage or loss of profit may claim compensation..

2. The same shall apply if anyone disseminates allegations which jeopardise a person’s reputation, income or livelihood, the untruth of which was known or should have been known to him or her. In this case there is also a right to request a retraction and publication thereof ...”

Sections 1(1) and 7(1) of the Unfair Competition Act (Bundesgesetz gegen den unlauteren Wettbewerb) provide:

Section 1

Ҥ 1. Any party who, for competitive purposes:

1. uses an unfair commercial practice or any other unfair action which might possibly affect the competitive capability of a business in a significant way; or

2. uses an unfair commercial practice which is contrary to the requirements of professional diligence and likely to materially distort the economic behaviour of the average consumer whom it reaches or to whom it is addressed.

can be sued for negligence and damages in the event of default.”

Section 7

“1. Any party who, for competitive purposes, alleges or disseminates facts about a person’s business, a business owner or manager’s character, or a person’s, goods or services which may be detrimental to that business or to the credit standing of its owner, shall be liable [to pay] damages to the injured [party] unless such facts are demonstrably true. The injured [party] may file a claim for the party at fault to cease and desist from alleging or disseminating the facts. The injured [party] may furthermore demand a retraction and publication of the retraction.

...”

THE LAW

I. THE GOVERNMENT’S PRELIMINARY OBJECTIONS

A. The first applicant organisation’s victim status

32. The Government contested the first applicant organisation’s locus standi under Article 34 of the Convention.

33. Referring to the Court’s case-law, they asserted that the first applicant organisation was a governmental organisation under Article 34, as, legally, it was a public body entrusted with fulfilling governmental duties. Those tasks were fulfilled by exercising typically governmental powers, such as the issuing of decrees. In proceedings relating to decisions, the first applicant organisation was bound by the General Administrative Procedure Act (Allgemeines Verwaltungsverfahrensgesetz), and the enforcement of its decisions was based on the Federal Law for the Enforcement of Administrative Orders (Verwaltungsvollstreckungsgesetz). The decrees issued by the first applicant organisation were supervised by the Vienna Regional Government, which had powers to suspend them. Therefore, the first applicant organisation was not fully independent, as required by the Court’s case-law. Moreover, the relevant statement had been issued in the process of discharging the first applicant organisation’s legal public responsibilities.

34. The first applicant organisation contested that assertion. It was true that, legally, it was a public entity entrusted with the exercise of public functions. It was therefore correct that it was, in general, required to safeguard fundamental rights but did not enjoy such rights. However, aside from this legal aspect, it also had a non-governmental aspect, which rendered it capable of being a party under Article 34 of the Convention. The Court should therefore not examine the general abilities of the organisation to use the powers conferred on it by law, but the act in question itself. The issuing of the statement was not an act of a governmental organisation, but rather one of a private-law nature.

35. The Court refers to its well-established case law to the effect that a legal entity “claiming to be the victim of a violation by one of the High Contracting Parties of the rights set forth in the Convention or the Protocols thereto” may submit an application to the Court, provided that it is a “non‑governmental organisation” within the meaning of Article 34 of the Convention. The Court reiterates that the idea behind this principle is to prevent a Contracting Party from acting as both an applicant and a respondent party before the Court. The term “governmental organisations”, as opposed to “non‑governmental organisations” within the meaning of Article 34, includes legal entities which participate in the exercise of governmental powers or run a public service under government control. The term “governmental organisations” applies not only to the central organs of the State, but also to decentralised authorities that exercise “public functions”, regardless of their autonomy vis-à-vis the central organs; likewise it applies to regional and local authorities, including municipalities. In order to determine whether any given legal person falls within one of the two above categories, account must be taken of its legal status and, where appropriate, the rights that status gives it, the nature of the activity it carries out, the context in which it is carried out, and the degree of its independence from the political authorities (see Radio France and Others v. France (dec.), no. 53984/00, § 26, ECHR 2003-X, and Islamic Republic of Iran Shipping Lines v. Turkey (no. 40998/98, §§ 78-81, ECHR 2007‑V).

36. The Court has therefore considered a company to be a “non‑governmental organisation” where it was governed essentially by company law, did not enjoy any governmental or other powers beyond those conferred by ordinary private law in the exercise of its activities, and was subject to the jurisdiction of the ordinary rather than the administrative courts. In the past, the Court has also taken into account the fact that an applicant company carried out commercial activities, and had neither a public service role nor a monopoly in a competitive sector (see Vỳchodoslovenská Vodárenská Spoločnosť, A.S. v. Slovakia (dec.), no. 40265/07, § 31, 2 July 2013; State Holding Company Luganksvugillya v.Ukraine (dec.), no. 23938/05, 27 January 2009); and Transpetrol, a.s. v. Slovakia (dec.), no. 28502/08, 15 November 2011)).

37. With regard to Austria, the Court has stated that communes and the Chamber of Commerce had to be seen as governmental organisations within the meaning of Article 34 (see, respectively, 16 Austrian Communes and some of their Councillors v. Austria, no. 5767/72, Commission decision of 31 May 1974, and Weiss v. Austria, no. 14596/89, Commission decision of 10 July 1991). However, the Austrian Broadcasting Corporation (Österreichischer Rundfunk – ORF) was not seen as an governmental organisation within the meaning of Article 34, as it did not exercise governmental powers, and its independence and institutional autonomy had been preserved (see Österreichischer Rundfunk v. Austria, no. 35841/02, § 53, 7 December 2006).

38. It is undisputed that the first applicant organisation exists by virtue of the legislature that thus provides its continued existence. Its legal status is therefore that of a public-law body and not an entity founded in accordance with private law.

39. The Court observes further that the structure of the first applicant organisation is provided for by law and that membership is compulsory. The relationship between the members and the governing body is defined by means of public law issued by the governing body, and is not subject to the jurisdiction of the civil courts. Even the enforcement of payment of contributions arrears is a matter governed by the Federal Law for the Enforcement of Administrative Orders.

40. Further, the Court observes that the mission of the first applicant organisation is prescribed by the Medical Practitioners Act as well.

41. As regards the nature of its activities, on one hand it is undisputed that the first applicant organisation may, in certain matters, act as a private entity, and can be held liable before the ordinary courts. On the other hand, there is agreement between the parties that the first applicant organisation exercises governmental powers and has a public service role in organising and managing the education of doctors and their access to employed and self-employed work. In exercising all these functions, it is under the supervision of other State authorities. All the chamber’s organs can be dismissed from office by the regional Government under the section 195b of the Medical Practitioners Act.

42. Moreover, the activities of the first applicant organisation are financed by compulsory and enforceable contributions of all medical practitioners in Austria (see para. 38).

43. The Court is not persuaded by the first appplicant organisation´s argument that in publishing the impugned article he did not exercise of any governmental powers within the meaning of Article 34. The impugned statement was clearly made in exercising the chambers public function.

44. Accordingly, the Court concludes that the first applicant organisation is not a “person, non-governmental organisation or group of individuals” within the meaning of Article 34 of the Convention.

45. In accordance with Article 35 § 3, it follows that the application is incompatible ratione personae with the provisions of the Convention. The Court must therefore reject the application of the first applicant organisation as inadmissible.

B. The second applicant’s victim status

46. The Government further argued that the second applicant had acted as the president of the first applicant organisation, and therefore as the head of a governmental organisation. He had used the first applicant organisation’s website to publish his statement, and had done this to fulfil his duties towards doctors. His act should be regarded as governed by public law, and his application should therefore be declared inadmissible ratione personae.

47. The second applicant contested that argument and emphasised that the national courts had found that he had not acted within the sphere of the duties conferred by public law. Otherwise, the courts could not have prohibited him from repeating the statements in question.

48. The Court reiterates that the term “victim”, used in Article 34 of the Convention, denotes the person directly affected by the act or omission which is in issue (see Centro Europa 7 S.r.l. and Di Stefano v. Italy [GC], no. 38433/09, § 92, ECHR 2012).

49. In the present case, the courts prohibited the second applicant, a natural person, from repeating the statement that the F. company was ruthless towards third parties, in particular medical professionals, and from referring to the F. company as a “locust”, “locust company” or “locust fund”. It was undisputed in the course of the domestic proceedings that the second applicant hereby acted as a representative of the first applicant. However by addressing the court order explicitly also to the second applicant as a natural person it affected the second applicant individually. Therefore, the Court considers that the second applicant has standing to introduce the present application. The Government’s objection is thus dismissed.

50. Moreover, the second applicant’s complaint is not manifestly ill‑founded within the meaning of Article 34 of the Convention. The Court further notes that it is not inadmissible on any other grounds. It is therefore declared admissible.

II. ALLEGED VIOLATION OF ARTICLE 10 OF THE CONVENTION

51. The second applicant complained of an infringement of his right to freedom of expression as a result of the measures imposed on him by domestic courts. He relied on Article 10 of the Convention, which reads:

“1. Everyone has the right to freedom of expression. This right shall include freedom to hold opinions and to receive and impart information and ideas without interference by public authority and regardless of frontiers. This Article shall not prevent States from requiring the licensing of broadcasting, television or cinema enterprises.

2. The exercise of these freedoms, since it carries with it duties and responsibilities, may be subject to such formalities, conditions, restrictions or penalties as are prescribed by law and are necessary in a democratic society, in the interests of national security, territorial integrity or public safety, for the prevention of disorder or crime, for the protection of health or morals, for the protection of the reputation or rights of others, for preventing the disclosure of information received in confidence, or for maintaining the authority and impartiality of the judiciary.”

52. The Government accepted that there had been “interference by public authority” with the exercise of the applicant’s right to freedom of expression. They contended, however, that that interference satisfied the requirements of the second paragraph of Article 10.

53. An interference contravenes Article 10 of the Convention unless it is “prescribed by law”, pursues one or more of the legitimate aims referred to in paragraph 2 of Article 10 and, in addition to being proportionate, is “necessary in a democratic society” for achieving such aims.

A. The parties’ submissions

54. The second applicant accepted that the interference served a legitimate aim, namely “the protection of the reputation or rights of others” within the meaning of Article 10 § 2 of the Convention.

55. However, in his view, the imposed prohibition had not been lawful, as section 7 of the Unfair Competition Act was not clear, and a prohibition based on that law was therefore not foreseeable. Accordingly, the interference was not prescribed by law.

56. As regards the necessity of the interference, the second applicant emphasised that he had contributed to a debate of public interest, and that, in respect of public shareholder companies, the limits of acceptable criticism were wider. He acknowledged that the term “locust” had a negative meaning associated with private-equity funds. However, there had been a substantive factual basis for his allegations, as the shareholders of the F. company were also companies limited by shares, and a private-equity fund was managing the holdings of one of the shareholders of the F. company. By calling the F. company a “locust” company, he had not intended to act competitively. Instead, his intention had been to voice a pointed criticism of a process he considered unlawful. The statement had aimed to point out the ongoing shift from the predominance of independent medical practitioners to a medical service determined by capital, and the consequent risks involved for doctors and their work. Moreover, the prohibition imposed by the domestic courts would prevent him from fulfilling his duties as President of the Vienna Chamber of Medical Doctors. Therefore, the interference was also not proportionate.

57. The Government submitted that the interference was “prescribed by law”, as it had its basis in sections 1 and 7 of the Unfair Competition Act. Those provisions were formulated with sufficient precision to enable the citizen to regulate his conduct, as required by the Court’s case-law. In the field of competition law in particular, an absolutely precise formulation could not be expected, as business markets and ways of communicating would always be subject to change. In addition, the interference had pursued a legitimate aim.

58. In relation to the necessity of the interference, the Government submitted that the interference was based on grounds which were “sufficient and relevant” in terms of the aims pursued, and was proportionate to those aims. They accepted that the second applicant had taken part in a debate on a matter of public interest, namely public health care in Austria. The domestic courts had issued decisions which, in the past, the Court had accepted as being within the wide margin of appreciation in purely commercial matters. The Austrian courts had followed this case-law and had considered the second applicant’s statement to be a statement of fact. On that basis, they had conducted a careful and detailed examination of the case and the parties’ arguments. The second applicant had failed to prove the existence of these facts. The fact that the F. company was a company limited by shares was no proof that it would be ruthless towards its employees or act like a “locust”. Even if the statement had to be treated as a value judgment, the second applicant had failed to show a sufficient factual basis to support his assertions. The second applicant had acted for competitive purposes, as he had stated himself at the first-instance hearing. Moreover, the courts had not prohibited the second applicant from warning against the alleged threats companies limited by shares would pose to the system of medical care, in instances where such warnings had a sufficient factual basis.

59. The Government further pointed out that the courts had not imposed a penalty, but rather an obligation not to repeat the statement that the F. company acted ruthlessly or was a “locust”. Therefore, the interference with the second applicant’s rights was of minor effect. It would not prevent him from participating in the ongoing debate about the impact of companies on medical services.

B. The Court’s assessment

1. “Prescribed by law”and legitimate aim

60. The Court reiterates that, in the past, it has held that section 1 of the Unfair Competition Act – which prohibits unfair commercial practice or any other unfair action which might affect the competitive capability of a business in a significant way for competitive purposes – was sufficiently precise for the purpose of Article 10 of the Convention and, accordingly, that an interference based on that provision was prescribed by law within the meaning of Article 10 (see, Krone Verlag GmbH & Co. KG v. Austria (no. 3), no. 39069/97, § 24, ECHR 2003‑XII). Section 7 of the Unfair Competition Act defines “conduct” in more detail than section 1, and in substance prohibits allegations being made or facts being disseminated about a competitor’s business for competitive purposes, unless such facts are demonstrably true. The Court sees that provision as sufficiently precise for the purpose of Article 10 of the Convention. Also, the national courts’ orders to cease and desist are the legal consequences clearly outlined in section 7 of that Act. Therefore, the Court considers that the interference was prescribed by law, namely by sections 1 and 7 of the Unfair Competition Act.

61. Moreover, there is agreement between the parties that the interference served a legitimate aim, namely “the protection of the reputation or rights of others” within the meaning of Article 10 § 2 of the Convention. The Court shares this view.

2. “Necessary in a democratic society”

62. The Court notes that in the present case, the second applicant made a public statement which affected the reputation of the F. company. The right to protection of reputation is a right which is protected by Article 8 of the Convention. In order for Article 8 to come into play, however, an attack on a person’s reputation must attain a certain level of seriousness (see Delfi AS v. Estonia [GC], no. 64569/09, § 137, ECHR 2015). The Court has reiterated many times, that in cases which require the right to respect for private life to be balanced against the right to freedom of expression, the outcome of the application should not, in theory, vary according to whether it has been lodged with the Court under Article 8 of the Convention by the person who was the subject of the statement, or under Article 10 by the person who made the statement. Indeed, as a matter of principle these rights deserve equal respect (see Von Hannover v. Germany (no. 2) [GC], nos. 40660/08 and 60641/08, § 106, ECHR 2012).

63. The Court reiterates that, under its case-law, Contracting States have a certain margin of appreciation in assessing the necessity of an interference, but this margin is subject to European supervision as regards both the relevant rules and the decisions applying them (see markt intern Verlag GmbH and Klaus Beermann v. Germany, 20 November 1989, § 33, Series A no. 165).

64. The Court has identified a number of criteria in the context of balancing the competing rights. The relevant criteria thus defined are: contribution to a debate of public interest, the degree of notoriety of the person affected, the subject of the news report, the prior conduct of the person concerned, the content, form and consequences of the publication, and, where appropriate, the circumstances in which the photographs were taken. Where it examines an application lodged under Article 10, the Court will also examine the way in which the information was obtained and its veracity, and the gravity of the penalty imposed on the person who made the statement (see, mutatis mutandis Couderc and Hachette Filipacchi Associés v. France [GC], no. 40454/07, § 93, 10 November 2015).

65. The Court has also found that large public companies inevitably and knowingly lay themselves open to close scrutiny of their acts, and that the limits of acceptable criticism are wider in respect of such companies. However, in addition to the public interest in open debate about business practices, there is a competing interest in protecting the commercial success and viability of companies – not just for the benefit of shareholders and employees, but also for the wider economic good. Therefore, the State enjoys a margin of appreciation as to the means it provides under domestic law by which a company can challenge the truth and limit the damage of allegations which risk harming its reputation (see Steel and Morris v. the United Kingdom, no. 68416/01, § 94, ECHR 2005‑ II). Furthermore, the Court emphasises that a wider margin of appreciation entrusted to the States is essential in the complex and fluctuating area of unfair competition (see Krone Verlag GmbH & Co. KG (no. 3), cited above § 30, and Jacubowski v. Germany, 23 June 1994, § 26, Series A no. 291‑A).

66. However, it is necessary to reduce the extent of the margin of appreciation when what is at stake is not an individual’s purely “commercial” statement, but his participation in a debate of general interest, for example, a debate about public health (see Hertel v. Switzerland, 25 August 1998, § 47, Reports 1998‑VI).

67. The Court notes that, in order to assess the justification of a statement which is in issue, a distinction must be made between statements of fact and value judgments. While the existence of facts can be demonstrated, the truth of value judgments is not susceptible of proof. The requirement to prove the truth of a value judgment is impossible to fulfil and infringes freedom of opinion itself, which is a fundamental part of the right secured by Article 10. However, even where a statement amounts to a value judgment, there must exist a sufficient factual basis to support it. The classification of a statement as one of fact or as a value judgment is a matter which, in the first place, falls within the margin of appreciation of the national authorities – in particular, the courts (see, Lindon, Otchakovsky‑Laurens and July v. France [GC], nos. 21279/02 and 36448/02, § 55, ECHR 2007‑IV). However, the Court can change this classification under its supervisory role (see Kharlamov v. Russia, no. 27447/07, § 31, 8 October 2015; Pinto Pinheiro Marques v. Portugal, no. 26671/09, § 43, 22 January 2015).

68. Turning to the circumstances of the present case, the Court notes that the domestic courts took the statement of 18 January 2007 into consideration in its entirety, and found that the statement was made in the clearly economic context of competing medical practices and capital companies providing the same services. They acknowledged that where a competitor, even for economic purposes, took part in a debate of public interest, freedom of expression had to hold more weight with regard to the balancing exercise. However, the term “locust” was almost exclusively loaded with negative meaning, which led to an unethical general vilification of a competitor. The word used gave the reader the impression that the F. company had already demonstrated unethical conduct which harmed the interests of doctors and patients. Therefore, the domestic courts judged the relevant statement to be one of fact. The statement was also likely to damage the F. company’s commercial interests, and had not been proved to be true.

69. The Court considers that there is no need to further clarify whether the present statement was one of fact or a value judgment, since a sufficient factual basis for it was needed in any case. For a company which offers medical services, the accusation that it acted as a “locust” (which, as can be seen from the context of the applicants’ letter, also implied that the F. company or similar companies placed economic interests above those of its patients) was a particularly serious one which affected its reputation. Thus, even if the applicant had intended to make that statement in the context of a wider debate on an issue of public concern, he had to have a solid factual basis on which to base that allegation. In the domestic proceedings, the Austrian courts – after carefully examining the arguments put forward by the applicant – concluded that there was no such factual basis, and the applicant has likewise not provided any persuasive argument substantiating his allegations. Neither the fact that the shares in the F. company are owned by other companies limited by shares and that one of those shareholders is managed by a private-equity fund, nor the fact that financial resources for expansion are raised by debenture provides a factual basis for the unethical conduct typically associated with “locust” corporations. In addition, the fact that doctors are employees within the F. company does not provide a factual basis for the second applicant’s allegations. The general remarks by the second applicant concerning the future impact of the growing popularity of companies providing medical services are not related to any actions on the part of the F. company; therefore, they cannot provide a factual basis for his allegations against that company.

70. Accordingly, the Court arrives at the conclusion that the prohibition imposed on the second applicant was based on “relevant and sufficient” grounds.

71. As regards the measures imposed on the second applicant, the Court notes that, according to its case-law, the nature and severity of the interference imposed are factors to be taken into account when assessing its proportionality (see mutatis mutandis Lindon, Otchakovsky-Laurens and July, cited above, § 59, and Europapress Holding d.o.o. v. Croatia, no. 25333/06, § 54, 22 October 2009).

72. The Vienna Commercial Court did not impose a penalty, but prohibited the second applicant from calling the F. company ruthless by the term “locust”. The second applicant was also ordered to publish the operative part of the Vienna Commercial Court’s judgment on the first applicant organisation’s website, and in its print newsletter. Even if the second applicant now risks the imposition of fines for non-compliance with the injunction, the nature and severity of the court’s action was moderate. The second applicant also failed to give reasons as to why the court’s action would prevent him from fulfilling his duties.

73. In conclusion, the Court finds that the interference with the exercise of the second applicant’s right to freedom of expression was necessary in a democratic society, within the meaning of Article 10 of the Convention, in order to protect the reputation and rights of the F. company. There has therefore been no violation of Article 10 of the Convention.

FOR THESE REASONS, THE COURT, UNANIMOUSLY,

1. Declares the application of the first applicant organisation inadmissible and the remainder of the application admissible;

2. Holds that there has been no violation of Article 10 of the Convention in respect of the second applicant.

Done in English, and notified in writing on 16 February 2016, pursuant to Rule 77 §§ 2 and 3 of the Rules of Court.

Fatoş AracıAndrás Sajó
Deputy RegistrarPresident

Full & Egal Universal Law Academy