FIRST SECTION
DECISION
Applications nos. 50743/16 and 50748/16
Dragan RUKAVINA against Croatia and
AMEC RIJEKATEKSTIL D.O.O. against Croatia
The European Court of Human Rights (First Section), sitting on 11 January 2022 as a Committee composed of:
Péter Paczolay, President,
Raffaele Sabato,
Davor Derenčinović, judges,
and Liv Tigerstedt, Deputy Section Registrar,
Having regard to:
the applications (no. 50743/16 and no. 50748/16) against Croatia lodged with the Court under Article 34 of the Convention for the Protection of Human Rights and Fundamental Freedoms (“the Convention”) on 24 August and 28 April 2016 respectively by a Croatian national, Mr Dragan Rukavina, who was born in 1960 and lives in Rijeka (“the first applicant”), and by AMEC Rijekatekstil d.o.o., a limited liability company incorporated under Croatian law and having its registered office in Rijeka (“the second applicant”), who were both represented by Mr Z. Vukić, a lawyer practising in Rijeka;
the decision to give notice of the complaint under Article 7 of the Convention to the Croatian Government (“the Government”), represented by their Agent, Ms Š. Stažnik, and to declare inadmissible the remainder of the applications;
the parties’ observations;
Having deliberated, decides as follows:
SUBJECT-MATTER OF THE CASE
1. The second applicant is a company and the first applicant is its director. They complain under Article 7 of the Convention that their conviction in minor-offences proceedings related to the control of foreign currency operations was not foreseeable.
2. In particular, on 24 February 2015 the applicants were convicted on the basis of section 49(6) and subparagraph 18 of section 63(1) of the Foreign Currency Act (Zakon o deviznom poslovanju) by the Ministry of Finance for failing to provide evidence about the ownership of an offshore company from which they had received several loans in foreign currency.
3. The applicants challenged this decision before the High Minor Offences Court, arguing that section 49(6) of the Foreign Currency Act defined as a minor offence a failure to provide information, and not evidence, of the ownership of an offshore business partner. They stressed that they had provided that information, but that it had been impossible for them to provide specific evidence, which had anyway not been required under section 49(6) of the Foreign Currency Act. The High Minor Offences Court dismissed the applicants’ appeal on the grounds that this was simply a terminological matter and that their conviction was compatible with the essence of the offence.
THE COURT’S ASSESSMENT
4. Having regard to the similar subject matter of the applications, the Court finds it appropriate to examine them jointly in a single decision.
5. In cases such as the present one the Court’s function is to consider, from the standpoint of Article 7 § 1 of the Convention, whether the applicants’ act or omission fell within the definition of the minor offence of which they were convicted and, consequently, whether it was foreseeable that their act or omission could constitute such an offence (see, for example, Pantalon v. Croatia, no. 2953/14, § 50, 19 November 2020).
6. Section 49(6) of the Foreign Currency Act, which is still in force, provides that “Residents obliged to report capital operations with non‑residents to the Croatian National Bank shall, at the request of the Ministry of Finance – Financial Inspectorate, submit information on beneficial owners of non-residents with which they are conducting operations, if the non-resident is an offshore entrepreneur.”
7. However, the Court notes that this provision was not the only legal basis for the applicants’ conviction as the domestic authorities also relied on subparagraph 18 of section 63(1) of the Foreign Currency Act (see paragraph 2 above). That provision, which is also still in force, provides that natural or legal persons may be punished by a fine for a minor offence if, inter alia, they do not “provide the Financial Inspectorate with the requested documentation and information”.
8. Therefore, while it is true, as the applicants submitted, that the first of those two provisions indeed does not provide for an obligation to submit evidence, the second one does. The Court thus accepts the Government’s argument that the constitutive elements of the offence for which the applicants were convicted are set out in two provisions which complement each other. In support of their argument the Government provided copies of domestic decisions, including a decision of the High Minor Offences Court, in which the domestic authorities imposed fines on various natural and legal persons for their the failure to submit evidence of beneficial ownership of their offshore business partners.
9. The foregoing considerations are sufficient to enable the Court to conclude that the applicants’ omission fell within the definition of the minor offence of which they were convicted and, consequently, that it was foreseeable that their omission could constitute such an offence.
10. The applicants’ argument that it was impossible to comply with the obligation to submit the requested evidence (see paragraph 3 above) is of no relevance in the context of Article 7 of the Convention.
11. It follows that the present application is inadmissible under Article 35 § 3 (a) of the Convention as manifestly ill-founded and that it must therefore be rejected pursuant to Article 35 § 4.
For these reasons, the Court, unanimously,
Decides to join the applications;
Declares the applications inadmissible.
Done in English and notified in writing on 3 February 2022.
Liv Tigerstedt Péter Paczolay
Deputy Registrar President