CASE OF Î.M. BECOR S.R.L. v. THE REPUBLIC OF MOLDOVA

FIFTH SECTION

CASE OF Î.M. BECOR S.R.L. v. THE REPUBLIC OF MOLDOVA

(Application no. 71529/14)

JUDGMENT
 

STRASBOURG

3 July 2025

This judgment is final but it may be subject to editorial revision.

In the case of Î.M. Becor S.R.L. v. the Republic of Moldova,

The European Court of Human Rights (Fifth Section), sitting as a Committee composed of:

 Georgios A. Serghides, President,
 Gilberto Felici,
 Diana Sârcu, judges,
and Martina Keller, Deputy Section Registrar,

Having regard to:

the application (no. 71529/14) against the Republic of Moldova lodged with the Court under Article 34 of the Convention for the Protection of Human Rights and Fundamental Freedoms (“the Convention”) on 24 October 2014 by a Moldovan company Î.M. Becor S.R.L. (“the applicant company”), which was registered in 1997 in Moldova and represented at the time by Mr V. Gribincea and by Mr A. Levinschi, both at the time lawyers practising in Chișinău;

the decision to give notice of the application to the Moldovan Government (“the Government”), represented by their Agent, Ms D. Maimescu;

the parties’ observations;

Having deliberated in private on 12 June 2025,

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

SUBJECT MATTER OF THE CASE

1.  The application concerns the levy of additional import duties and imposition of penalties on the applicant company after the Customs Service had assigned another classification code to goods which had been imported four years earlier. The applicant company relied on Article 1 of Protocol No. 1 to the Convention.

2.  In 2008‑2012 the applicant company imported substances, which at the time were classified as medicines by the National Medicines Agency.

3.  In 2012 the Customs Service reclassified the substances as dietary supplements, imposed penalties, and levied additional VAT and customs duties on the applicant company’s imports from 2008 to 2012 to the total amount of 1,896,483.59 Moldovan lei (MDL) (equivalent to 115,950 euros (EUR) at the time). The applicant company challenged these decisions in court.

4.  On 18 March 2013 the Chișinău District Court annulled the decisions of the Customs Service, holding that the imported substances were classified under the classification codes provided by the laws applicable at that time. The Chișinău Court of Appeal dismissed the appeal of the Customs Services and upheld the first-instance judgment.

5.  On 30 April 2014 the Supreme Court of Justice, giving a different interpretation to the laws, reversed the judgments issued by the lower courts and rejected the applicant company’s claims in a final decision.

6.  In two other sets of proceedings on a similar reclassification, in 2013 and 2014, the Supreme Court of Justice upheld the applicant company’s appeals and finally annulled the decisions of the Customs Service.

7.  After the communication of the present application to the respondent Government, the Government Agent lodged with the Supreme Court of Justice an application to reopen domestic proceedings, seeking the acknowledgment of a violation of the applicant company’s right guaranteed by Article 1 of Protocol No. 1 to the Convention and an award of non‑pecuniary damage equivalent to the awards made by the Court under Article 41 of the Convention.

8.  On 14 March 2024 the Supreme Court of Justice upheld the Agent’s request and reopened domestic proceedings, quashed its judgment of 30 April 2014, acknowledged a breach of Article 1 of Protocol No. 1 to the Convention, awarded the applicant company EUR 3,000 in non-pecuniary damage and ordered a fresh examination of the Customs Service’s appeal on points of law.

9.  In the new proceedings before the Supreme Court of Justice, the applicant company claimed the restitution of additional duties and penalties it had paid the Customs Service (MDL 1,896,483.59), the interest on that amount accrued over ten years (MDL 3,415,339, equivalent at the time to EUR 174,440), and costs and expenses incurred in the proceedings before the domestic courts and before the European Court of Human Rights (MDL 256,307.3, equivalent at the time to EUR 13,090).

10.  On 12 June 2024 the Supreme Court of Justice dismissed the Customs Service’s appeal on points of law as manifestly ill-founded and upheld the findings of the lower courts favourable to the applicant company (see paragraph 4 above). The court also ordered the Customs Service to pay the applicant the amount of the incorrect additional duties and penalties (MDL 1,896,483.59) and awarded MDL 40,000 (equivalent to EUR 2,067 at the time) in costs and expenses. The Supreme Court of Justice did not rule on the applicant company’s claim on interest, considering it a new claim which had not been previously raised before the lower courts.

THE COURT’S ASSESSMENT

ALLEGED VIOLATION OF ARTICLE 1 of protocol no. 1 to THE CONVENTION

11.  The applicant company complained under Article 1 of Protocol No. 1 to the Convention about the deprivation of its possessions in the public interest. The applicant company argued that the favourable decision handed down by the Supreme Court of Justice after reopening the proceedings was not sufficient to deprive it of its victim status, because the Supreme Court of Justice had only partially redressed the pecuniary damage by ordering the restitution of the incorrectly charged amount of MDL 1,896,483.59 but had failed to compensate the interest, calculated under the provisions of the Civil Code and accrued over ten years. The applicant company argued that the late-payment interest was closely linked to the pecuniary damage it had suffered after it could not use its money for more than ten years. As for the non-pecuniary damage, it argued that the EUR 3,000 awarded was inconsistent with the awards previously granted by the Court in similar cases and was insufficient to compensate for the state of uncertainty it had suffered.

12.  The Government submitted that the applicant company had lost its victim status after, in the reopened domestic proceedings, the domestic courts had acknowledged the violation of Article 1 of Protocol No. 1 to the Convention in this respect, had ordered restitutio ad integrum of the pecuniary damage and had awarded the applicant company non-pecuniary damage and costs and expenses in amounts comparable to the awards made by the Court in similar cases. As for the late-payment interest, the Government argued that there was no causal link between the violation found under the reopened proceedings and the claimed late-payment interest.

13.  The Court finds that this objection is inextricably linked to the merits of this complaint, and the Court joins it thereto. Furthermore, the applicant company’s complaint is not manifestly ill-founded within the meaning of Article 35 § 3 (a) of the Convention or inadmissible on any other grounds. It must therefore be declared admissible.

14.  The Court notes that the Supreme Court of Justice found a breach of Article 1 of Protocol No. 1 to the Convention holding that a fair balance had not been struck between the general interests and the individual interests of the applicant company and it sees no reason to disagree with that finding. The Court also notes that the Supreme Court of Justice awarded the applicant company compensation for pecuniary and non-pecuniary damage and considers that the principal issue is whether the award made was proportionate to the damage suffered by the applicant.

15.  The Court further notes that a judgment in which it finds a breach, or in cases like the present one, where, after the communication of an application, the domestic courts reopen proceedings and acknowledge a Convention breach, in order for the applicant to be deprived of the victim status the respondent State has to put an end to the breach and make reparation for its consequences in such a way as to restore as far as possible the situation existing before the breach (see Former King of Greece and Others v. Greece [GC] (just satisfaction), no. 25701/94, § 72, 28 November 2002; Dacia S.R.L. v. Moldova (just satisfaction), no. 3052/04, § 39, 24 February 2009; Arzamazova v. the Republic of Moldova, no. 38639/14, § 60, 4 August 2020). It recalls in this latter respect that the level of compensation must not be unreasonable in comparison with the awards made by the Court in similar cases (see Burdov v. Russia (no. 2), no. 33509/04, § 99, ECHR 2009). Where, as in the present case, the victim status and therefore, the existence of a violation, is linked with the monetary redress afforded at domestic level, the Court’s assessment necessarily involves comparison between the actual award and the amount that the Court would award in similar cases (see, mutatis mutandis, Scordino v. Italy (no. 1) [GC], no. 36813/97, § 181, ECHR 2006‑V, and Holzinger v. Austria (no. 1), no. 23459/94, § 21, ECHR 2001‑I).

16.  Turning to the present case, the Court notes, in respect of pecuniary damage, that the domestic courts awarded the applicant company the amount of duties and penalties unlawfully levied but refused to grant any default interest on that amount. In this respect, the Court points out that in its case-law it has consistently linked the payment of late-payment interest to delays by the authorities in refunding credits. In particular, the Court has held on several occasions that the adequacy of compensation would be diminished if it were to be paid without reference to various circumstances liable to reduce its value, such as unreasonable delay (see Almeida Garrett, Mascarenhas Falcão and Others v. Portugal, nos. 29813/96 and 30229/96, § 54, ECHR 2000‑I; Angelov v. Bulgaria, no. 44076/98 § 39, 22 April 2004). In such a case the Court will mainly have regard to whether the authorities have paid late-payment interest to offset the depreciation of the amount due on account of the time that has elapsed (see Akkuş v. Turkey, 9 July 1997, § 29, Reports of Judgments and Decisions 1997‑IV; Dolneanu v. Moldova, no. 17211/03, § 44, 13 November 2007; Chinnici v. Italy (no. 2), no. 22432/03, § 43, 14 April 2015; Scerri v. Malta, no. 36318/18, § 45, 7 July 2020). In short, under Article 1 of Protocol No. 1 the payment of interest is intrinsically linked to the State’s obligation to make good the difference between the amount owed and the amount ultimately received by the creditor (see Eko-Elda AVEE v. Greece, no. 10162/02, § 29, ECHR 2006-IV).

17.  The Court, therefore, notes the delay of more than ten years before the State had redressed the breach of Article 1 of Protocol No. 1 of the Convention and the absence of any pecuniary compensation for this delay. In the light of the foregoing, despite the restitution to the applicant company of additional duties and penalties, the Court considers that it can still claim to be a victim of a violation of Article 1 of Protocol No. 1 to the Convention after the domestic courts failed to compensate the losses it had incurred as the result of not being able to use its money for such a long period. It therefore dismisses the Government’s objection and finds that there has been a violation of Article 1 of Protocol No. 1 to the Convention.

APPLICATION OF ARTICLE 41 OF THE CONVENTION

18.  The applicant company claimed pecuniary damage in the form of late-payment interest to the total amount of 3,415,339 Moldovan lei (MDL) (equivalent to 177,3375 euros (EUR) on the day of its submissions on just satisfaction) calculated under the provisions of the Civil Code and accrued over ten years. It also claimed EUR 3,000 in non-pecuniary damage, in addition to EUR 3,000 already awarded by the domestic courts. In costs and expenses, it claimed EUR 11,533, which represented the difference between EUR 13,600, which is the total amount of costs and expenses incurred and MDL 40,000 (equivalent to EUR 2,067) already awarded by the Supreme Court of Justice in the course of the reopened proceedings. The applicant company submitted evidence that it had paid the legal fees to its lawyer.

19.  The Government disagreed with the claim for pecuniary damage, considering it unfounded, excessive and speculative. The Government submitted that the claim for non-pecuniary damage was also unsubstantiated because the applicant company had already been awarded EUR 3,000 by the domestic courts in this respect. Finally, the Government submitted that the Supreme Court of Justice had already awarded the applicant company MDL 40,000 in costs and expenses, which included the representation costs before the Court, while the additional lawyer’ fees claimed were unnecessary, excessive and disproportionate to the nature and complexity of the case.

20.  The Court notes that in the instant case the interference is the disproportionate obligation to pay additional import duties and penalties. As noted above, a restitutio in integrum would require the compensation of the amount of the incorrectly levied taxes and penalties (damnum emergens) and a compensation for the long period of loss of use of that amount of money (lucrum cessans) (see paragraphs 15 - 17 above). The applicant company has already been repaid the amount of the incorrectly levied taxes and penalties and non-pecuniary damage as a result of the reopened domestic proceedings.

21.  Having regard to the applicant company’s inability to use the money for more than ten years and also the partial redress obtained at domestic level in the course of reopened proceedings, ruling on an equitable basis, the Court decides to award the applicant company a lump sum of EUR 45,000 in respect of pecuniary and non-pecuniary damage.

22.  In respect of the costs and expenses, according to the Court’s settled case-law, costs and expenses are recoverable under Article 41 of the Convention if it is established that they were actually and necessarily incurred and are reasonable as to quantum. The Supreme Court of Justice has already awarded the applicant company MDL 40,000 (equivalent to EUR 2,067) for the lawyer’s fees, which included the expenses for the representation before the Court. Considering that the amount of the lawyer’s fees already awarded by the Supreme Court of Justice is not disproportionate to the complexity of the case, the Court will dismiss the applicant company’s claim for costs and expenses.

FOR THESE REASONS, THE COURT, UNANIMOUSLY,

(a)  that the respondent State is to pay the applicant company, within three months, EUR 45,000 (forty-five thousand euros), in respect of pecuniary and non-pecuniary damage, to be converted into Moldovan lei, at the rate applicable at the date of settlement, plus any tax that may be chargeable;

(b)  that from the expiry of the above-mentioned three months until settlement simple interest shall be payable on the above amounts at a rate equal to the marginal lending rate of the European Central Bank during the default period plus three percentage points;

Done in English, and notified in writing on 3 July 2025, pursuant to Rule 77 §§ 2 and 3 of the Rules of Court.

 Martina Keller Georgios A. Serghides
 Deputy Registrar President