Published on 11 August 2025
FIFTH SECTION
Application no. 37662/18
Mykhaylo Mykhaylovych MOSKALU
against Ukraine
lodged on 26 July 2018
communicated on 25 July 2025
SUBJECT MATTER OF THE CASE
The application concerns sanctions imposed on the applicant for an alleged breach of customs regulations.
On 31 August 2016 the applicant, who held dual citizenship and claimed to have permanent residence in Romania, entered Ukraine driving a car registered to his Romanian address. He presented his valid Romanian passport and car registration documents. According to the applicable law (Article 380 of the Customs Code), Ukrainian citizens who had permanent residence outside Ukraine, as well as foreigners and stateless persons who also resided permanently outside Ukraine were allowed to temporarily import personal vehicles for up to one year without the need for a written customs declaration, additional state control documents or financial guarantees. In contrast, Ukrainian resident citizens were required to pay customs duties and submit a written commitment to re-export imported vehicles.
On 2 August 2017, while leaving Ukraine, a customs inspection revealed that the applicant had Ukrainian citizenship and possessed a Ukrainian international passport. On 10 November 2017 the Customs Office issued a decision finding that, although the applicant was a Ukrainian citizen, he had used his Romanian passport upon entry to Ukraine in order to avoid paying customs duties, thereby committing an offence under Article 485 of the Customs Code. A fine amounting to approximately 14,800 euros (EUR) was imposed on the applicant. Article 485 of the Customs Coded provided that actions aimed at unlawfully avoiding or reducing the payment of customs duties ‑ such as submitting false information in customs declarations, presenting falsified documents, failing to pay duties on time, or misusing goods granted customs exemptions – were punishable by a fine equal to 300% of the unpaid customs duties. The applicant contested the decision of 10 November 2017 in court.
On 21 February 2018 the Pershotravneviy District Court of Chernivtsi annulled the customs authority’s decision as unlawful and closed the administrative case, finding that the mere possession of a Ukrainian passport did not prove an intent to evade customs duties. It concluded that the customs authorities’ allegations were based on assumptions unsupported by evidence.
On 28 March 2018 the Vinnytsya Administrative Court of Appeal (“the Court of Appeal”) overturned the first-instance decision and upheld the customs authority’s decision. It noted that Ukraine does not recognize dual citizenship and treats anyone holding a Ukrainian passport solely as a Ukrainian citizen, and that, therefore, the applicant was required to use his Ukrainian passport while on the territory of Ukraine.
The Court of Appeal also found that the only valid evidence of a Ukrainian citizen’s permanent residence abroad was a Ukrainian international passport bearing a “Permanent Residence” stamp issued by the competent Ukrainian authorities. It relied in this respect on the Law on “the Procedure for Leaving and Entering Ukraine for Citizens of Ukraine,” the Procedure for centralized processing, issuance, exchange, withdrawal, return to the State, invalidation, and destruction of passports of citizens of Ukraine for travel abroad, approved by Resolution of the Cabinet of Ministers of Ukraine No. 185 on 13 March 2013, as well as the Procedure for examining, by diplomatic missions or consular institutions of Ukraine abroad, applications of persons, who had temporarily departed abroad, for issuance of permits to reside abroad permanently, approved by Order of the Ministry of Foreign Affairs of Ukraine No. 201 of 22.11.1999.
The Court of Appeal concluded that the applicant should be classified as a permanent resident of Ukraine who was liable to pay import duties on his vehicle. It further found that, by using his Romanian passport, the applicant had deliberately sought to benefit from the customs regime applicable to non‑residents, thereby committing the offence as charged by the Customs Office. This decision was final.
Relying on Article 6 of the Convention and, in substance, on Article 1 of Protocol No. 1, the applicant complains that both his administrative conviction and penalty imposed on him were unfair. He argues, inter alia, that during the customs inspection he did not provide any false information or document, as required for an offence under Article 485 of the Customs Code; that he was classified as a resident of Ukraine despite holding permanent residency in Romania; and that the fine imposed on him ‑ exceeding the value of his car by more than thirty times – was excessive and based on an incorrect assessment of the vehicle’s value.
QUESTIONS TO THE PARTIES
1. Did the applicant have a fair hearing in the determination of the criminal charges against him, in accordance with Article 6 § 1 of the Convention, having regard to his allegations that the domestic authorities failed to establish any bad faith on his part and disregarded his arguments that he had submitted a valid document, was permanently residing abroad, and that the value of the vehicle had been incorrectly assessed?
2. Did the sanction imposed on the applicant by the domestic courts for the alleged breach of customs rules constitute an interference with the peaceful enjoyment of the applicant’s possessions, within the meaning of Article 1 of Protocol No. 1? If so, was that interference lawful and compatible with the proportionality requirement under Article 1 of Protocol No. 1 (see Krayeva v. Ukraine, no. 72858/13, 13 January 2022)? In particular:
(a) Was the legal framework, as interpreted by the domestic courts, under which the applicant was obliged to use only his Ukrainian passport while on the territory of Ukraine and was classified as a resident – and thereby subjected to the customs sanction – sufficiently accessible and foreseeable, to the extent that the applicant could reasonably have anticipated that presenting a valid Romanian passport at the Ukrainian border and failing to obtain a prior formal authorisation from the State for permanent departure abroad would lead to his conviction for a customs offence and the imposition of a substantial financial penalty?
(b) Can a system that requires individuals to obtain prior authorisation from the State in order to be recognised as permanently residing abroad – and under which the absence of such authorisation automatically leads to their classification as residents and to the imposition of significant financial penalties, as in the present case, regardless of evidence of actual residence abroad – in itself be considered necessary in a democratic society? Does such a system strike a fair balance between the general interest and the applicant’s right to the peaceful enjoyment of his possessions?
(c) Was the amount of the fine proportionate in the circumstances of the present case?