FOURTH SECTION
DECISION
Application no. 40841/20
LARA TURISM S.R.L.
against Romania
The European Court of Human Rights (Fourth Section), sitting on 28 mars 2023 as a Committee composed of:
Faris Vehabović, President,
Branko Lubarda,
Ana Maria Guerra Martins, judges,
and Crina Kaufman, Acting Deputy Section Registrar,
Having regard to:
the application (no. 40841/20) against Romania lodged with the Court under Article 34 of the Convention for the Protection of Human Rights and Fundamental Freedoms (“the Convention”) on 26 August 2020 by a Romanian company (“the applicant company”), Lara Turism S.R.L., set up in 2004 and represented by Mr H. Brisc and Mr I.A. Soiom, lawyers practising in Cluj Napoca.
Having deliberated, decides as follows:
SUBJECT MATTER OF THE CASE
1. The case mainly concerns administrative proceedings brought by the applicant company, a Romanian limited liability company with a social capital of 200 Romanian lei (RON) (approximately 50 euros (EUR) at the time), seeking the annulment of an offence report for providing tourism services without authorisation.
2. On 18 December 2018, following an inspection of the activities carried out by the applicant company, the competent administrative authorities of the Ministry of Tourism produced an offence report fining the applicant company RON 40,000 (approximately EUR 8,200) for providing tourism services without authorisation. The fine was based on the provisions of Articles 15 let a) and 16 § 1 let a) of Government Decision no. 1267/2010 concerning the classification certificates, licenses and patents for tourism activities, which sanctioned the provision of tourism services without authorisation with fines between RON 40,000 and 50,000.
3. On 28 January 2019 the applicant company filed a complaint with the Turda District Court seeking to set aside the report. It challenged the interpretation and application by the inspection authorities of the relevant legal provisions and, in particular, the alleged wrong legal basis for classifying the administrative offence; it claimed that instead of applying Articles 15 let a) and 16 § 1 let a) of Government Decision no. 1267/2010, the inspection authorities should have applied Articles 15 let b) of the same legal act, which concerned the provision of tourism services with an expired authorisation and which was punishable with a fine between RON 20,000 and 40,000 under Article 16 § 1 let c). It also contended that the fine imposed by the inspection authorities was disproportionate to the social danger of the administrative offence allegedly committed and requested its replacement with a warning.
4. On 29 July 2019 the Turda District Court allowed the applicant company’s complaint and set aside the report on the grounds that it did not comply with the conditions of merits laid down by law and that the sanction applied did not meet the proportionality criteria. The domestic court pointed out that the national law made a clear distinction between companies providing services without authorisation and companies whose authorisation expired and the fines provided for such situations differed, being lower in the latter case. It further noted that the applicant company had obtained an authorisation in 2005, which had expired in 2008, and therefore the inspection authorities should have imposed a fine for providing services with an expired authorisation instead of a fine for providing services without authorisation.
5. By a final decision of 27 February 2020, the Cluj County Court allowed an appeal on points of law lodged by the inspection authorities and overturned the first-instance judgment. Ruling on the merits it dismissed the applicant company’s complaint finding that the interpretation of the law by the inspection authorities had been correct. It noted that the applicant was authorised to carry out its activity in 2005 in accordance with Government Decision no. 1328/2001, which was subsequently repealed by Government Decision no. 709/2009 and Government Decision no. 1267/2010 respectively. It further noted that even though its authorisation had expired long before the entry into force of the government decision 1267/2010 the applicant company had not followed the procedure to obtain a new authorisation under the applicable provisions of the Government decisions enacted either in 2009 or in 2010. Consequently, the domestic court held that the applicable provisions in the present case were those of Article 15 let a) concerning the provision of services without an authorisation, as correctly applied by the inspection authorities. It also held that the amount of the fine imposed on the applicant company was the minimum prescribed by the law on that contravention and rejected the claimant’s request to replace it with a warning.
6. The applicant company complained that the arbitrary and restrictive interpretation of the applicable legal provisions by the inspection authorities and the domestic court of last resort, which lead to the imposition of a heavier penalty was in breach of Article 7 of the Convention.
THE COURT’S ASSESSMENT
7. The Court will first determine of its own motion (see Blečić v. Croatia [GC], no. 59532/00, § 67, ECHR 2006‑III) the applicability of Article 7 of the Convention. It must therefore ascertain whether the impugned measure, namely the imposition of an administrative fine on the applicant company, should be regarded as a penalty within the autonomous meaning of Article 7.
8. The criteria for establishing the notion of penalty have been summarised in G.I.E.M. S.R.L. and Others v. Italy [GC], nos. 1828/06 and 2 others, §§ 210-33, 28 June 2018.
9. From the outset the Court notes that in the present case the disputed measure was not imposed as a result of the criminal conviction of the applicant company but for the commission of an administrative offence sanctioned by the inspection authorities with the imposition of a fine, subsequently reviewed by civil courts (see paragraphs 2, 4 and 5 above) in proceedings which essentially fall within the ambit of administrative law.
10. As regards the classification of the fine imposed on the applicant company in domestic law, the Court notes that it was prescribed by Government Decision no. 1267/2010 aimed at regulating the performance of tourism activities by commercial companies (see paragraph 2 above). The measure was thus not set out in criminal law.
11. However, as the characterisation under domestic law has only a relative value, the very nature of the offence, considered also in relation to the nature of the corresponding penalty, represents a factor of assessment of greater weight. In this regard the Court observes that the fine was imposed on the applicant company under general legal provisions applying to all companies carrying out tourism activities. They prescribe conduct of a certain kind, in particular, to perform their activities with a valid authorisation and make the resultant requirement subject to a sanction that is punitive in its purpose. In the instant case, the fine was undoubtedly substantial for the applicant company and not intended as pecuniary compensation for damage but as a punishment to deter reoffending. Consequently, the Court considers that the general character of the rule and the purpose of the penalty imposed on the applicant company, being both deterrent and punitive, suffice to show that the penalty in question was, in terms of Article 7 of the Convention, criminal in nature.
12. As regards the severity of the measure, the Court notes that the kind of administrative offence for which the applicant company was held liable was punishable by a fine, which although it could not be converted into deprivation of liberty in the event of non-payment, was of a significant amount and consequently it had the potential to substantially impact the further performance of the applicant company’s activity (see Del Río Prada v. Spain [GC], no. 42750/09 § 82, ECHR 2013).
13. Having regard to the foregoing, the Court concludes that the impugned fine imposed on the applicant company can be regarded as a “penalty” within the meaning of Article 7 of the Convention.
14. The Court will further determine whether the interpretation of the domestic law by the inspection authorities and the court of last resort was arbitrary and restrictive and therefore in breach of Article 7 of the Convention.
15. In this connection it reiterates that the principle of legality requires the offences and corresponding penalties to be clearly defined by law. The concept of “law” within the meaning of Article 7 comprises qualitative requirements, in particular those of accessibility and foreseeability (G.I.E.M. S.R.L. and Others v. Italy [GC], cited above, § 242, and Del Río Prada v. Spain [GC], cited above, § 91).
16. In the present case, the Court notes that the relevant legal provisions, namely Government Decision no. 1267/2010, and in particular Articles 15 and 16 of that decision, were formulated with sufficient precision to enable the applicant company to discern, to a degree that was reasonable in the circumstances, the scope of the penalty imposed. The Court considers therefore that the law satisfies the requirements of accessibility and foreseeability.
17. The Court further stresses that however clearly drafted a legal provision may be, in any system of law, there is an inevitable element of judicial interpretation. The role of adjudication vested in the courts is precisely to dissipate such interpretational doubts as remain (see Kafkaris v. Cyprus [GC], no. 21906/04 § 141, ECHR 2008). The Court also reiterates its settled case-law to the effect that it is primarily for the national authorities to interpret and apply domestic law and that, in principle, it is not its task to substitute itself for the domestic jurisdictions. Given the subsidiary nature of the Convention system, it is not the Court’s function to deal with errors of fact or law allegedly committed by a national court, unless and in so far as they may have infringed rights and freedoms protected by the Convention and unless that domestic assessment is manifestly arbitrary (see Vasiliauskas v. Lithuania, [GC], no. 35343/05, § 160, ECHR 2015).
18. Turning to the present case, the Court notes that the domestic court of last instance conducted a detailed analysis of the applicable legal provisions (see paragraph 5 above). It considered that the assessment made by the first‑instance court had not been accurate as it had omitted to examine the succession in time of the applicable legal provisions. The domestic court of last instance noted that even though the applicant company had been authorised to perform its activity in 2005, in accordance with Government Decision no. 1328/2001 new legal provisions concerning the authorisation of companies’ activities entered into force in 2009 and 2010 respectively and stressed the fact that the applicant company had not been able to present an authorisation, even expired, issued according to a procedure and in compliance with the requirements of the law in force at the time of the inspection, namely Government Decision no. 1267/2010. The Court considers that the interpretation of the domestic court of last resort appears to be in line with the applicable legal provisions in force at the relevant time and cannot discern any signs that its findings were arbitrary or manifestly unreasonable.
19. The application is accordingly manifestly ill-founded and must be rejected under Article 35 §§ 3 (a) and 4 of the Convention.
For these reasons, the Court, unanimously,
Declares the application inadmissible.
Done in English and notified in writing on 20 April 2023.
Crina Kaufman Faris Vehabović
Acting Deputy Registrar President