Communicated on 8 March 2016
THIRD SECTION
Application no. 101/15
Aleksey Anatolyevich NAVALNYY and Oleg Anatolyevich NAVALNYY
against Russia
lodged on 5 January 2015
STATEMENT OF FACTS
The applicants, Mr Aleksey Anatolyevich Navalnyy and Mr Oleg Anatolyevich Navalnyy, are Russian nationals who were born in 1976 and 1983 respectively and live in Moscow. They are represented before the Court by Ms A. Polozova, Mr K. Polozov and Ms O. Mikhaylova, lawyers practising in Moscow.
A. The circumstances of the case
The facts of the case, as submitted by the applicants, may be summarised as follows.
The first applicant, Aleksey Navalnyy, is a political activist, opposition leader, anti-corruption campaigner and popular blogger. The second applicant, Oleg Navalnyy, his brother and an entrepreneur and former employee of the Federal State unitary enterprise Russian Post, is currently serving a three and a half year sentence in a correctional colony.
From 2005 the second applicant worked at the Main Centre for Long‑Distance Mail, a subsidiary of Russian Post. On 1 December 2007 he became head of its Internal Mail department and then worked in other managerial posts in various departments and branches of Russian Post.
On 17 October 2006 Russian Post concluded a contract with the limited liability company Multidisciplinary Processing Company (OOO Многопрофильная процессинговая компания – hereinafter “MPK”) and a telecommunications company whereby MPK undertook to print telephone bills and deliver them through Russian Post to the telecommunications company’s customers.
On 1 February 2007 Russian Post concluded another contract with MPK whereby the latter leased electronic equipment to Russian Post. On 10 April 2007 MPK subcontracted the private joint-stock company Interregional Mail Centre (OAO Межрегиональный специализированный почтовый центр – hereinafter “MSPT”) to sort, pack and transfer the equipment to Russian Post.
On 3 December 2007 the applicants and their parents acquired the limited liability company Alortag Management Limited, incorporated in Cyprus.
On 7 May 2008 MPK subcontracted the printing of the telephone bills to the limited liability company IPS M-City (OOO ИПС М-Сити – hereinafter “M‑City”).
On 19 May 2008 Alortag Management Limited set up a Russian limited liability company, Chief Subscription Agency (ООО Главное подписное агентство – hereinafter “GPA”).
On 16 July 2008 Russian Post’s Mail Service Directorate informed its client, the limited liability company Yves Rocher Vostok (OOO Ив Роше Восток), the Russian subsidiary of French company Yves Rocher, that from 1 October 2008 it would terminate its collection of the client’s parcels from a specific distribution centre and that this service would henceforth be subject to a separate contract. Subsequently, Ms B., a manager at Yves Rocher Vostok, asked the second applicant for advice on handling the transfer of parcels from the distribution centre and he suggested that she use a private contractor, GPA.
On 2 August 2008 the financial director of Yves Rocher Vostok, Mr K.M., signed an agreement with GPA for the collection of parcels from the distribution centre and their transfer, for which GPA would charge 23,600 Russian roubles (RUB) per shipment. On 10 August 2008 GPA subcontracted the transport services under that agreement to two specialist courier companies. GPA paid the couriers RUB 14,000 per shipment. GPA and its contractors provided the services to Yves Rocher Vostok until the end of 2012.
On 7 November 2008 the general director of MPK, Mr Shustov, signed an agreement with GPA whereby the latter undertook to provide overall logistical services to MPK related to the printing, sorting, packing and distribution of telephone bills as well as the sorting, packing and transfer of electronic equipment to Russian Post. Subsequently GPA subcontracted these services to seventeen specialist companies, including M-City. GPA and its contractors rendered the services to MPK until March 2013.
Between 2011 and 2012 the first applicant organised and participated in a number of public assemblies and actively pursued an anti-corruption campaign targeting high-ranking public officials.
On 4 December 2012 the general director of Yves Rocher Vostok, Mr B.L., lodged a complaint with the Investigative Committee of the Russian Federation (hereinafter “the Investigative Committee”) alleging that in 2008 unidentified persons had misled his company employees and persuaded them to conclude a contract with GPO, thus depriving the company of a free choice of contractor. He stated that the company might have sustained significant damage as a result.
On 13 December 2012 the Investigative Committee opened criminal proceedings to investigate the allegations of fraud and money laundering. The applicants were suspected of defrauding Yves Rocher Vostok and laundering the proceeds of illegal transactions between the company and GPA. The charges were formulated under Articles 159.4 and 174.1 § 2 (a) and (b) of the Criminal Code.
On 10 December 2012 the first applicant made a public plea for people to participate in the Freedom March, an opposition rally at Lubyanskaya Square on 15 December 2012, in defiance of a ban by the Moscow authorities on that event.
On the same day the investigator in an unrelated criminal case against the first applicant (“the Kirovles case”) informed the Investigative Committee that there were grounds to believe that the applicants had defrauded MPK. On 12 April 2013 the Investigative Committee opened a criminal investigation on the basis of the material taken from the Kirovles case.
On 14 and 17 December 2012 the Investigative Committee ordered the applicants not to leave Moscow pending the investigation to ensure their appearance before the investigator.
On 20 December 2012 charges were brought against the applicants under Articles 159.4 and 174.1 § 2 (a) and (b) of the Criminal Code in connection with the acts allegedly committed against MPK and Yves Rocher Vostok.
On 13 February 2013 the second applicant requested that five employees of Yves Rocher Vostok, including Mr B.L. and Ms B., be questioned as witnesses. On 18 February 2013 the request was dismissed by the investigator. It appears that the witnesses were questioned during the investigation, but the applicants were not informed or invited to have a face‑to-face confrontation with them.
On 11 February 2013 the financial director of Yves Rocher Vostok, Mr K.M., submitted an internal audit report to the investigator stating the company had not sustained any damage or loss of profits due to its agreement with GPO; it had been established by the auditors that GPO had charged the market price for its services.
On 28 October 2013 the charges were reformulated.
On 15 November 2013 the applicants were informed that the investigation had ended.
On 28 February 2014 the Basmannyy District Court ordered that the first applicant be placed under house arrest until 28 April 2014 because of the risk he might abscond, continue criminal activity, threaten witnesses and other participants in the criminal proceedings, destroy evidence or otherwise obstruct the course of justice. The court also referred to his criminal record and recent conviction for administrative offences. It imposed on the applicant a number of conditions for the period of the house arrest, in particular restricting his ability to “communicate with anyone except for [his] immediate family, ... the legal counsel representing him in the criminal case and the [investigating officials]; receive and send correspondence ... use means of communicating, the telecommunications network and Internet; and make statements [and] declarations [or give] addresses or comments in connection with this criminal case using the mass media.” The first applicant remained under house arrest until the end of 2014.
On 14 August 2014 the Zamoskvoretskiy District Court began hearing the applicants’ criminal case. On 14 November 2014 and on several subsequent occasions the applicants requested that the court call and examine Mr B.L. and Ms B. from Yves Rocher Vostok and various individuals employed by Russian Post as witnesses. They also asked the court to obtain certain internal Russian Post documents relating to its structure and functioning. The court dismissed these requests.
On 9 December 2014 the applicants requested the court to summon six witnesses, including Mr B.L. and Ms B.
On 15 December 2014 the court, at the request of the prosecutor, issued a warrant compelling Mr B.L. to appear; however, it was not executed. The court subsequently allowed statements he and Ms B. had given during the investigation to be read out.
On 19 December 2014 the applicant’s case was concluded and the judge announced that the judgment would be delivered on 15 January 2015.
At about 4 p.m. on 29 December 2014 the applicants and their defence counsel were summoned by telephone to appear in court at 9 a.m. on 30 December 2014 for the delivery of the judgment.
On 30 December 2014 the court delivered the operative part of the judgment in the applicants’ case. The applicants were found guilty of fraud against MPK and Yves Rocher Vostok and money laundering, and were convicted under Articles 159.4 §§ 2 and 3 and 174.1 § 2 (a) and (b) of the Criminal Code. The first applicant received a suspended sentence of three and a half years and the second applicant a prison sentence of the same duration, to be served in a correctional colony. They were also fined RUB 500,000 each. The first applicant was ordered to remain under house arrest and the second applicant be remanded in pre-trial detention, adding that the second applicant’s term of imprisonment would run from that day. Delivery of the judgment in full was adjourned until 12 January 2015.
On the same day the second applicant appealed against his detention.
On 31 December 2014 the first applicant appealed against the extension of his house arrest.
On 12 January 2015 the applicants appealed against the judgment of 30 December 2014 on the merits. On the same day they received a copy in full.
On 19 January 2015 the Moscow City Prosecutor’s Office appealed against the first-instance judgment on the grounds that the sentence given to both applicants was excessively lenient.
On 28 January 2015 the applicants challenged the accuracy of the verbatim records of the first-instance hearing. Only a few of their corrections were accepted.
On 11 February 2015 the applicants filed additional points of appeal and a request that six witnesses be called and examined, including Mr B.L. and Ms B.
On 17 February 2015 the Moscow City Court upheld the first-instance judgment, except for the part imposing a fine on the applicants, which was reversed.
On 27 April 2015 the applicants lodged a cassation appeal.
B. Relevant domestic law
The Criminal Code of the Russian Federation provides as follows:
Article 159.4: Commercial fraud
(in force from 29 November 2012)
“1. Fraud committed in conjunction with deliberate non-compliance with contractual obligations in the commercial sphere:
shall be punishable ...
2. The same acts committed on a large scale:
shall be punishable by a fine of up to one million roubles or up to two years’ wages/salary or other income ... or up to three years’ community service or deprivation of liberty of the same duration with or without up to a year’s restriction of liberty.
3. The same acts committed on an especially large scale:
shall be punishable by a fine of up to one million five hundred thousand roubles or up to three years’ wages/salary or other income ... or up to five years’ community service or deprivation of liberty of the same duration with or without up to two years’ restriction of liberty.”
Article 174.1: Laundering funds or other property acquired
in the commission of an offence
(in force between 7 December 2011 and 28 June 2013)
“1. Financial operations and other transactions using funds or other property acquired by a person as a result of committing a crime ... to create the appearance of lawful possession, use or disposal of the said funds or property, committed on a large scale:
shall be punishable ...
2. The acts provided for by paragraph 1 of this Article committed:
(a) in conspiracy;
(b) by someone in abuse of his official position or on a large scale
shall be punishable by up to five years’ community service or deprivation of liberty for the same duration with or without a fine of up to five hundred thousand roubles or up to three years’ wages/salary or other income ...”
Article 174.1: Laundering funds or other property acquired
in the commission of an offence
(in force from 28 June 2013)
“1. Financial operations and other transactions using funds or other property acquired by as a result of a person having committed a crime to create an appearance of lawful possession, use or disposal of the said funds or property, committed on a large scale:
shall be punishable by a fine of up to one hundred and twenty thousand roubles or up to a year’s wages/salary or other income ...
2. The same acts committed on a large scale:
shall be punishable by a fine of up to two hundred thousand roubles or between one and two years’ wages/salary or other income ... or up to two years’ community service or up to two years’ deprivation of liberty with or without a fine of up to fifty thousand roubles or up to three months’ wages/salary or other income ...
3. The acts provided for by paragraphs 1 or 2 of this Article committed:
(a) in conspiracy;
(b) by someone in abuse of his official position or on a large scale
shall be punishable by up to three years’ community service with or without up to two years’ restriction of liberty with or without a ban on holding certain posts or pursuing certain activities for up to three years or up to five years’ deprivation of liberty with or without a fine of up to five hundred thousand roubles or up to two years’ wages/salary or other income ... with or without up to two years’ restriction of liberty with or without a ban on holding certain posts or pursuing certain activities for up to three years.”
COMPLAINTS
The applicants complain under Article 6 §§ 1 and 2 of the Convention that they did not receive a fair and public hearing in the determination of criminal charges against them. They refer, in particular, to the delivery of the judgment in part on 30 December 2014 and the court’s refusal to obtain, admit and give weight to exonerating evidence.
They also complain under Article 6 §§ 1 and § 3 (a) and (b) of a change in the legal classification of the criminal offences of which they were convicted. They claim that they only learned of it when they received a full copy of the judgment on 12 January 2015 and could not therefore prepare their defence accordingly.
Under Article 6 §§ 1 and 3 (c) they complain of inconsistencies between the court verbatim records and official audio recording.
They further complain under Article 6 §§ 1 and 3 (d) of the Convention that the court failed to call and examine key witnesses in the case, in particular Mr L.B. and Ms B., and the fact that the court admitted statements they had made during the investigation.
The applicants also complain under Article 7 of the Convention that they were convicted of acts that were lawful at the material time. They claim that the authorities extended the interpretation of the offence of which they were convicted to such broad and ambiguous terms that it does not satisfy the requirements of foreseeability.
Finally, both applicants allege that their prosecution and criminal conviction pursued purposes other than bringing them to justice, but happened in order to prevent the first applicant from pursuing his public and political activity. They rely on Article 18 of the Convention.
In addition, the second applicant complains of a violation of Article 5 §§ 1 and 4 of the Convention on the grounds that on 30 December 2014 the court ordered that he remain in detention, a decision he could not challenge and which contained no reasons. He also alleges that he was not given the detention order and was thus detained without a valid warrant.
QUESTIONS TO THE PARTIES
1. Having regard to the applicants’ specific allegations in respect of the criminal proceedings, did they receive a fair and public hearing by an independent and impartial tribunal in accordance with Article 6 §§ 1, 2 and 3 of the Convention? The Government are invited to answer, in particular, the following questions:
(i) was the partial delivery of the judgment on 30 December 2014 compatible with the guarantees of a fair and public hearing set out in Article 6 § 1 of the Convention?
(ii) did the procedure in which the evidence was admitted and examined comply with the principles of adversarial proceedings and equality of arms, as required by Article 6 § 1 of the Convention?
(iii) were the applicants able to examine witnesses against them and obtain the attendance of witnesses on their behalf under the same conditions as witnesses against them, as required by Article 6 § 3 (d) of the Convention? Was the admission of witness statements given during the investigation compatible with Article 6 §§ 1 and 3 (d) of the Convention?
(iv) did the legal classification of the criminal offences imputed to the applicants change during or after their trial, and if so was it compatible with Article 6 §§ 1 and 3 (a) and (b) of the Convention?
(v) were there any inconsistencies between the verbatim records and official audio recording made at the first-instance hearing, which was not corrected at the applicants’ request, and if so was the refusal to correct the verbatim records compatible with Article 6 §§ 1 and 3(c) of the Convention?
2. Did the acts of which the applicants were convicted constitute a criminal offence under national law at the time they were committed, as envisaged by Article 7 of the Convention? In particular, was the offence of which the applicants were convicted clearly defined in law (see Kokkinakis v. Greece, judgment of 25 May 1993, Series A no. 260‑A, p. 22, § 52)?
3. The Government are requested to submit an update on the criminal proceedings against the applicants, in particular to provide a copy of the decision taken pursuant to the applicants’ appeal on points of law lodged on 27 April 2015, if any. They are also requested to provide a copy of the verbatim records of the first-instance hearing and a copy of the official audio recording of the same hearing.
Full & Egal Universal Law Academy