Published on 21 July 2025
FIFTH SECTION
Application no. 22201/17
Dmytro Nikonovych SMOLNIKOV
against Ukraine
lodged on 10 March 2017
communicated on 1 July 2025
SUBJECT MATTER OF THE CASE
The application concerns an alleged breach by the applicant of customs regulations in the course of customs clearance of goods imported into Ukraine and a sanction imposed as a result.
The applicant is the director of a private enterprise “S.”. On various dates, the applicant carried out customs clearance procedures for different goods imported by the enterprise. Customs duties, calculated on the basis of the customs value of the goods as declared by the applicant during the clearance, were paid, and the goods were released for free circulation.
Following a review of the accuracy of the customs value determination, the customs authorities revised the declared value and increased it. Disagreeing with this adjustment, the enterprise “S.” failed to pay the difference between the customs duties calculated based on the applicant’s declared value and those recalculated according to the value determined by the customs authorities.
As a result, the applicant, in his capacity of the director of the enterprise, was issued administrative offence reports for customs violations and was held liable under Article 485 of the Customs Code (“Actions aimed at illegal exemption from payment of customs duties or reduction of their amount”) which provides, inter alia, for liability in the event of a failure to pay customs duties within the time-limit set by law. A fine amounting to 300% of the unpaid customs duties was imposed, as provided for in that provision (for more details, see the Appendix).
The applicant challenged the customs authorities’ decisions before the domestic courts, arguing, inter alia, that national law did not set up any time-limit for the payment of the reassessed customs duties and that, accordingly, he could not have been held liable for failing to pay them within any specific period. He also disputed the customs authorities’ interpretation of the relevant customs regulations, particularly with regard to the calculation of the customs duties.
The domestic courts upheld the decisions of the customs authorities. Referring to various provisions of the Customs Code, they found that the enterprise was required to pay the adjusted customs duties within the time‑limit indicated in box 48 of the customs declaration, which the applicant had marked when completing the declarations. This time-limit corresponded to the period for paying the financial guarantee, which a declarant provided at the time the goods were released for free circulation, aimed at securing the payment of the adjusted customs duties – namely within 90 days from the date of release of the goods for free circulation.
The applicant’s argument that his enterprise had not provided such a guarantee – as the law did not require one where the difference between the customs value declared and that determined by the customs authorities was below a certain threshold in UAH - and that, therefore, it was not bound by the time-limit set for the financial guarantee, was dismissed by the courts as a misinterpretation of the applicable legal provisions, in particular as an erroneous assumption that the absence of a financial guarantee implied that no payment of adjusted customs fees was required at all.
Relying on Article 6 § 1 of the Convention, the applicant complains that his conviction was unfair, in particular because the domestic courts failed to give due consideration to his argument that no time-limit for the payment of adjusted customs duties was set by the law in situations where no financial guarantee was required. Under Article 1 of Protocol No. 1 to the Convention, the applicant further complains that the sanction imposed on him was unlawful and disproportionate.
QUESTIONS TO THE PARTIES
1. In the proceedings indicated in the Appendix, 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, in particular in view of the alleged failure of the domestic courts to give due consideration to relevant and important arguments put forward by the applicant?
2. Did the sanctions imposed on the applicant by the domestic courts in these proceedings for the alleged breach of customs regulations constitute an interference with the peaceful enjoyment of his 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)?
3. Has the applicant complied with the six-months’ time-limit, laid down in Article 35 § 1 of the Convention, in respect of his complaints concerning the proceedings related to the customs offence report of 8 October 2015 (proceedings no. 2)? In particular, was the application for review to the Supreme Court an effective remedy within the meaning of this provision?
APPENDIX
No.
Decision of the customs authorities
Final judicial decision
Date of receipt of the final decision by the applicant
Amount of the fine/ UAH
1
11 September 2015
15 September 2016, Higher Administrative Court
4 November 2016
21,409.35
2
8 October 2015
20 September 2016, Supreme Court
24 October 2016
23,728.83
3
22 October 2015
15 September 2016, Higher Administrative Court
3 October 2016
81,819.21
4
30 October 2015
15 September 2016, Higher Administrative Court
3 October 2016
50,485.92
5
2 November 2015
6 October 2016, Higher Administrative Court
24 October 2016
81,819.21