Georgia loses not only the real war with Russia but also the judicial one

The Georgian-Russian war started on 08/08/2008, and on 12/08/2008 Georgia filed an application against Russia before the International Court of Justice (ICJ), accusing Russian armed forces of ethnic cleaning under the International Convention on Elimination of All Forms of Racial Discrimination. An interesting question is whether this application was prepared before the start of the war or in 3 working days after its start.

The ICJ dismissed the action on 01/04/2011 due to the fact that Georgia did not try to negotiate with Russia before suing its Government (§ 141).

Georgians argued that Article 22 of the Convention providing a possibility of seising the ICJ in respect of “any dispute <…> which is not settled by negotiation” is merely a statement of fact (§ 128), but the ICJ replied that a dispute which is settled is not a dispute anymore (§ 134). Therefore, this phrase must mean that Georgia had to try to negotiate with Moscow. The future perfect tense of the French version even more suggests the need to try negociating: “tout différend … qui n’aura pas été réglé par voie de négociation” (§ 135). The ICJ also added that this is the precondition for an application under a number of other international treaties as confirmed by case law (§§ 131, 137, 138).

No exception for the state of war.

It is strange that Georgia adopted the legal strategy of a direct action, did not take insurance, and did not preview the scenario that has happened. The Saakashvili Government hired 14 lawyers for this case and Russians had 23.

From time to time the ECtHR compares internal case law

In Bulfracht Ltd. v Croatia, 53261/08, the ECtHR decided to compare the case law of the Croatian Constitutional Court on the calculation of claim value threshold to cross in order to be able to appeal on points of law (§ 39). This is the domain that is traditionally protected by the spirit of non-interpreting national law.

The Bulgarian ship’s operator Bulfracht Ltd. tried to sue the Croatian shipping broker company J.A. as a guarantor for the Cypriot company TWS who had ordered carriage of goods from Ukraine to Taiwan but had not paid the agreed USD 515 099.20 (§ 6). The threshold for appealing to the Croatian Supreme Court was HRK 500 000. In that case the Croatian Constitutional Court decided that exchanging USD into Yugoslavian dinars, and then to Croatian kuna (HRK) was the correct practice. Due to this manner of currency exchange the threshold was not met. However later the Constitutional Court adopted another Ruling stating that USD shall be exchanged directly into HRK.

Nevertheless, I’m not sure that such a comparison might become a permanent practice of the ECtHR.

In-house lawyers may not represent their companies, UKE, T-226/10

The EU General Court adjudicated in UKE v Commission, T-226/10, that in-house lawyers may not represent their companies in a litigation, since they are employees, and therefore aren’t independent. Even a dismissal of an in-house lawyer would not save the claim, since only the date of introduction of the claim counts (§ 2).

UKE tried to argue that it had a separate independent legal department, that the Polish law required maintaining independence, that the decision on litigation was made by the President of the company, and the 2 lawyers were employed by its Secretary General (§ 9).

However according to the General Court, only the EU institutions and Governments may be represented by in-house lawyers, but private companies and individuals must hire law firms (§ 12). A lawyer employed by secretary general has less independence than a lawyer from a private law firm (§ 21). The claim was declared inadmissible.

I often ask myself: what does the judge really think when she changes someone’s life due to such nonsense?

“Detailed position” standard for motivation in competition law

The EU General Court annulled the decision of the European Commission condemning Air liquid SA for the participation of its 100 % controlled Chemoxal SA in a cartel at the peroxide of hydrogen and perborate of sodium market, since the motivation of the Commission did not met the “detailed position” (“position circonstanciée”) on the proofs standard in case T-185/06. The main question was whether the two companies were the same economic entity. I would like to make a photo of this adjudication, since the application of this standard always appeared to me chaotic (or what I call “judicial shamanism” elsewhere).

The Commission stated in its decision that Chemoxal SA is the same economic entity with Air liquid SA, since

1. the latter owns 100 % of shares of the former, and the former uses commercial name “Air Liquid Chimie”.
2. Air liquid had the power to appoint the members of the Chemoxal’s Administrative Council.
3. The perception of third persons was that they are the same economic entity.

According to the EU General Court these are “supplementary indications” (§ 70), and not a “detailed position” on the proofs of Air liquid (§ 79). In § 67 the General Court names the arguments of Air liquid:

1. No director of Chemoxal was a member of the Air liquid Management Committee or another internal body at the same time. According to the European Commission an administrator of Chemoxal after ending his office there became a manager of Air liquid, § 49.
2. It follows from the minutes of the Chemoxal Administration Council that its President Director General had unlimited decision freedom. According to the European Commission this is quite normal from the formal point of view (§ 50).
3. Chemoxal had its own independent departments: commercial, marketing, human resources, IT, accounting. According to the European Commission it is quite normal. In addition, Chemoxal used other departments of Air liquid, and the two companies had their seat in the same building (§ 51).
4. Chemoxal autonomously managed its participation in Oxysynthèse Deutschland GmbH. Although one representative of Air liquid was a member of Oxysynthèse Administration Council, only one representative of Chemoxal sitted in the Management Committee of Oxysynthèse. This according to Air liquid proved that there was no common management of other companies.
5. Chemoxal SA autonomously managed the participation in Chemoxal Chemie GmbH.
6. Internal mails show that Chemoxal took the decisions on prices without interference of Air liquid.
7. All great strategic commercial projected were launched by the very staff of Chemoxal.
8. It follows from the circulaire of the Chemoxal Director General that Chemoxal independently prepared its budget.
9. Chemoxal directly contacted with all its clients.
10. Chemoxal was considered as an autonomous company by European Chemical Industry Council.
11. The fact of using the commercial name of “Air Liquid Chimie” by Chemoxal does not prove economic unity, since Chemoxal simply wanted to take advantage from a well-known brand.
12. No one among participants of the cartel meeting was an employee of Air liquid.

Financial supporter of impeached Lithuanian President Rolandas Paksas and the key person of the impeachment, lost his case

Another interesting point was made in the impeachment of Lithuanian President Rolandas Paksas story by the Strasbourg Court in case Borisov v Lithuania, 9958/04. Mr. Jurij Borisov, owner of Avia Baltika company, made a contribution of € 349 000 to the Paksas election campaign, and the latter was elected President of Lithuania on 05/01/2003.

Due to business interests, Mr Borisov took the Russian citizenship, which meant annulment of his Lithuanian citizenship. However he also had business interests in Lithuania. Then President Paksas granted him Lithuanian citizenship for “merits to Lithuania” (ECtHR tries not to mention the merits notion in the judgment), since Mr Borisov had the Medal of Darius & Girenas for merits to Lithuania, for the efforts to glorify the name of Lithuania in the World and assisting the State in its integration into the World Community of States. Other “merits” were the fact of spending € 1 740 000 for charity, paying € 5 million of taxes, creating 200 jobs directly, and 600 indirectly.

The Lithuanian Constitutional Court declared the grant of citizenship for merits to Lithuania unconstitutional. As a result, President Paksas was impeached on 06/04/2004. A lifelong prohibition to stand for presidential, parliamentary, and local elections, as well as a lifelong prohibition to become Prime Minister (Paksas is a twice former Prime Minister) or a minister was imposed on the impeached President of the Republic.

Mr Borisov was fined about € 2 900 for threatening the President. He would disclose certain information about the President, if the President did not appoint him his voluntary adviser (contrary to what the ECtHR writes in § 30, there is a difference between “voluntary adviser” and “adviser”). This provoked the desire of the Lithuanian Ministry of Interior to deport Mr Borisov from Lithuania due to “threat to national security”. On 28/06/2006 the President of the Lithuanian Parliament, Mr Viktoras Muntianas, addressed the General Assembly of Judges and stated that it would be “bad” if the Lithuanian Courts decided not to deport Mr Borisov from Lithuania.

The proceedings for deportation of Mr Borisov lasted for 6 years and 7 months until 13/08/2010 when he got a permanent residence permit, and he tried to argue that this was interference with his normal family life, since his parents, wife and children were Lithuanian citizens and lived in Lithuania (Article 8 of the Convention). However the ECtHR refused to consider the compatibility of the very change of style of family life as an interference, and argued that from 13/08/2010 there was no longer any justification for examining the merits of the case (§ 106).

The ECtHR expressed a “deep concern that the decision making in [Borisov] case was politicised”, pointed that “neither can the Court fail to observe that the Supreme Administrative Court chose to remit the case for fresh examination two times on somewhat contrived izobret grounds, thus continuing to keep [Borisov] and his family in a state of uncertainty” (§ 112). The 7 judges “regretted” that Borisov proceedings were that long (§ 112). However Borisov did not get any practical advantage from this moral consideration.

ECtHR: labour legitimate expectations are covered by property rights

On 07/06/2011 ECtHR unanimously re-affirmed its previous case law on covering legitimate expectations by property rights (Maurice v France, 11810/03, § 63). In Agrati and 127 others v Italy, 43549/08, it was interpreted that legitimate expectations of school workers to have their accessory salaries to be included into the calculation of pension are property rights (§ 73), and their legislative denial violates Article 1 of the Protocol no. 1.

Class action is always an interesting legal strategy, especially in after entering into force of the Protocol no. 14 introducing the important damage ground for dismissing an application (new Article 35(3)(b) of the Convention).

Offering shares at stock exchange is a method to reduce an anti-competition fine from € 219 to 113 million

Arkema SA (France) got a substantial reduction of the fine for participation in a cartel at the methacrylates market for 5 years and 7 months: from € 219 131 250 to 113 343 750 (judgment T-217/06). The most exciting is the legal method of the reduction.

One of the criteria for determining the amount of the fine is the turnover of the enterprise. Elf Aquitaine SA controlled from 97,6 to 96,48 % of Arkema SA shares, and 99,43 % of Elf Aquitaine shares were owned by Total SA (§ 2). While calculating the fine, the Commission took into account the turnover of the Total group, and not that of Arkema alone.

However 11 working days before imposition of the fine by the Commission the Arkema shares were put at stock exchange (§ 240). Thus, according to the EU General Court, the economic unity of Arkema and Total broke, and the turnover of Total could not be used in the calculation of the fine (§ 272).

Case Degussa v Commission, T 279/02, §§ 289 and 290, where it was decided that the turnover at the infringement moment must be taken into account, was declared inapplicable, since, contrary to that case, in Arkema case the European Commission didn’t mention that the Deguissa style application would be necessary having regard to the fact that Total was better placed than Arkema to evaluate the dangers of the anticompetitive behavior.

Thus, the judges conclude, the European Commission's fine was stronger than what was required by the sufficient deterrent effect principle.

UN Human Rights Committee destroys the hopes of Nazi victims, Sechremelis v Greece, 1507/2006

The UN Human Rights Committee followed the line of the ECtHR and the ECJ, and dismissed the hopes of Greek families to get compensation for the massacre of their relatives by the Nazis in case Sechremelis et al. v Greece, 1507/2006.

In this particular case the Nazis massacred the respective relatives in Distomo on 10/06/1944, and the Greek Court of Cassation confirmed their right to compensation from Germany on 26/03/2000. However the enforcement of such judgment against a foreign State is subjected to consent of the Minister of Justice. In this case he didn’t agree (§ 10.2).

The Committee “noted” two reasons for this View in § 10.5:

1) This limitation on enforcement does not impair the very essence of the right to an effective judicial protection.

2) It may not be excluded that the Greek judgment could be enforced sometime in the indefinite future.

3/14 Committee members dissented.

Khodorkovsky v Russia: victory or failure?

After 7 years of litigation before the ECtHR, the 7 judges chamber issued its judgment (5829/04) last week. On one hand they found 8 technical violations of the right not to be subjected to torture or inhuman treatment (Article 3 of the Convention), and of the right to liberty (Article 5) - such as, for instance, placing him into a metal cage during the domestic Court hearings (§ 124).

On the other hand the ECtHR refused to conclude that the violation of these rights had a purpose other than the officially declared - political persecution (Article 18), and this was, as I understand, a very important objective of Mr Khodorkovsky. There are two main adjudicative points on this issue.

1) Khodorkovsky argued that the UK, Cypriot, Dutch Courts and the Swiss Federal Tribunal had already decided that the persecution of the YUKOS executives was political (§ 253). The ECtHR replied that its "standard of proof" is "very high", i.e. higher than in those States (§ 260).

2) Khodorkovsky showed the reports and conclusions of the Parliamentary Assembly of the Council of Europe, of the European Parliament, the UK House of Commons, and the USA Senate who concluded that this was a political persecution. However the ECtHR replied that those were political and not judicial declarations (§ 259). The judges write that any persecution of such a rich and influential person as Khodorkovsky would have a political stake, and therefore the Article 18 protection would not be reasonable.

It is also interesting that Khodorkovsky did not use the argument of partiality of Russian judges (Article 6).

Impeachment of President Paksas of Lithuania after the victory in Strasbourg

On 06/01/2011 we won the case of impeached President Paksas of Lithuania before the ECtHR, where I had the honor to be a legal representative. Following the impeachment he had been disqualified from standing for elections for life, and the ECtHR found this to be disproportional.

The Lithuanian Government lawyers proposed to alter the lifelong sanction with 15 or 20 years prohibition.

It is remarkable that the United Nations Human Rights Committee found in case Dissanayake v Sri Lanka that 7 years ban to stand was unreasonable and disproportional. I don't see how to re-conciliate the Lithuanian vision with the case law of the UN HRC.