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by TRANSPETROL, a.s.
European Court of Human Rights (Third Section), sitting
on 15 November 2011 as a Chamber
regard to the above application lodged on 9 June 2008,
regard to the observations submitted by the respondent Government and
the observations in reply submitted by the applicant company,
deliberated, decides as follows:
- The applicant, TRANSPETROL, a.s. (“the
applicant company”), is a joint-stock company
established in 1993 under the laws of Slovakia with its head office
various stages of the proceedings before the Court the applicant
company was or has been represented by Mr J. Drgonec, Ms E. Csekes,
Mr Ľ. Novák,
Mr O. Korec and Mr M. Krivák,
lawyers practising in Bratislava.
Government of the Slovak Republic (“the Government”)
were represented by their Agent, Ms M.
A. The circumstances of the case
facts of the case, as submitted by the parties, may be summarised as
1. The applicant company
applicant company specialises in transporting, storing, buying and
selling oil. It has a registered capital of 100,843,372 euros.
- In the past, including at the time of the contested
of the Constitutional Court (see paragraphs 21 and 55 below), the
State, in the person of the Ministry of the Economy (“the
Ministry”), owned 51% of the shares in the applicant company.
The remaining shares were owned by private parties.
present all of the shares in the applicant company are owned by the
State, in the person of the Ministry.
status and functioning of the applicant company are subject to
provisions of the Commercial Code (see paragraph 50 in the “Relevant
domestic law” section below). It is subject to the jurisdiction
of the ordinary courts.
the Securing of State Interests on the Privatisation of Strategically
Important State-owned Enterprises and Joint-stock Companies Act (“the
Strategic Interests Act” – see paragraph 48 in the
“Relevant domestic law” section below), the shares in
applicant company which were held or owned by the State could not be
subject to privatisation.
the Large-scale Privatisation Act (“the Privatisation Act”
– see paragraph 49 in the “Relevant domestic law”
section below), the applicant company is listed among a list of
entities having the character of a natural monopoly (prirodzený
- Since 1998 a number of companies and individuals have
claimed that they have obtained title to 34% of the shares in the
applicant company by way of purchase in the context of a forced sale,
carried out pursuant to the enforcement of an adjudicated claim for
damages by a third party company against the State.
such company is a limited liability company, A.
ownership, possession and other rights in respect of the
above mentioned shares have been subject to numerous private-law
transactions and a large amount of litigation of various kinds.
persons involved in the transactions mentioned above, including the
representative of company A, a judicial enforcement officer and an
advocate, were put on trial on charges of money laundering and fraud.
The proceedings appear to be still pending, following a judgment
convicting the defendants at first instance.
details are summarised in the Court’s decision of
13 November 2003 in the application of Šándor
and Others v. Slovakia (no. 52567/99).
3. Authorisation to call a general meeting of the
(a) Petition of 4 November 2002
- On 4 November 2002 company A. lodged a petition with
the Bratislava I. District Court (Okresný súd)
arguing that it was the owner of 5.78% of the shares in the applicant
company, which was above the statutory 5% threshold for being
entitled to have an extraordinary general meeting (“EGM”)
of shareholders in the applicant company called.
A. argued that the applicant company had ignored a previous request
it had made to call an EGM and sought judicial authorisation to do so
applicant company was the defendant in those proceedings.
18 November 2004 the District Court allowed the petition and
authorised company A. to call an EGM, having found it established
that company A. was the owner of 110 shares in the applicant company.
- On 27 July 2005, exercising his discretionary power,
the Prosecutor General challenged the decision of 18 November 2004 in
the Supreme Court (Najvyšší
súd) by way of an extraordinary appeal on points of
law (mimoriadne dovolanie).
on Articles 4 and 20 § 2 of the
Constitution (see paragraphs 44 and 45 in the “Relevant
domestic law” section below) and on the relevant provisions of
the Strategic Interests Act and the Privatisation Act – see
paragraphs 48 and 49 in the “Relevant domestic law”
section below), the Prosecutor General argued, inter alia,
that at the relevant time the acquisition of shares in the applicant
company by company A. had been excluded by law. Company A. was
accordingly not a shareholder in the applicant company and had no
power to call an EGM of its members.
28 June 2006 the Supreme Court determined the extraordinary appeal
for the first time (see below) by allowing it, quashing the decision
of 18 November 2004 and remitting the case to the District Court
for re examination.
A. subsequently challenged the judgment of the Supreme Court of 28
June 2006 by way of a complaint under Article 127 of the Constitution
(see paragraph 46 in the “Relevant domestic law” section
Supreme Court was named as the defendant in this complaint. The
applicant company had no standing in the constitutional proceedings.
- On 19 August 2006 the proceedings on the merits of the
2002 petition of company A. (see paragraph 13 above) were terminated
following the withdrawal by company A. of its petition on the grounds
that the EGM had already taken place and that, consequently, the
petition had become moot.
- The further course of the proceedings, as described
below, thus merely concerned the extraordinary appeal of the
Prosecutor General (see paragraph 15 above) and the constitutional
complaints of company A. (see the preceding paragraph and paragraphs
26 and 30 below).
- On 11 December 2007 the Constitutional Court (Ústavný
súd) found that the Supreme Court had violated the right
of company A. to a fair trial.
the Constitutional Court quashed the judgment of 28 June 2006
and remitted the case to the Supreme Court for re-examination of the
Prosecutor General’s extraordinary appeal.
- In its reasoning, the Constitutional Court held that
“[company A.] had obtained the shares and had done so in the
course of enforcement proceedings” and that “it was
justified and lawful for [company A.] to assume that it had
legitimately become the owner of the shares, which had provided a
basis for it to have the power to call the general meeting”.
Constitutional Court also held that it had been wrong for the Supreme
Court to have re examined the question of the lawfulness of
the acquisition by company A. of the shares in question. To that end,
the Constitutional Court observed that, in the case at hand, the
Supreme Court had dealt with proceedings concerning the calling of an
EGM and that the acquisition in question had taken place in the
course of enforcement proceedings falling within the jurisdiction of
the enforcement courts and having been concluded with final and
28 May 2008 the Supreme Court ruled on the extraordinary appeal by
the Prosecutor General for the second time. It again quashed the
decision of 18 November 2004 and remitted the case to the District
Court for re-examination.
- The Supreme Court disagreed with the legal views of
the Constitutional Court and considered that, thereby, the
Constitutional Court had unconstitutionally interfered with its
- Company A. then challenged the judgment of the Supreme
Court of 28 May 2008 by way of a complaint under Article 127 of the
- On 15 January 2009 the Constitutional Court quashed
the judgment of 28 May 2008 and remitted the case to the Supreme
Court for a fresh determination of the extraordinary appeal by the
Constitutional Court found the contested judgment to be arbitrary,
devoid of adequate reasoning and contrary to the Supreme Court’s
being bound by legal reasoning expressed by the Constitutional Court
(see paragraph 47 in the “Relevant domestic law” section
23 November 2009 the Supreme Court ruled on the extraordinary appeal
by the Prosecutor General for the third time. It again quashed the
decision of 18 November 2004 and remitted the case to the District
Court for re examination.
- The Supreme Court considered the judgment of the
Constitutional Court of 15 January 2009 to be incomprehensible and
pointed out that the handling of the petition at first instance had
been chaotic and riddled with numerous irregularities.
- Company A. challenged the Supreme Court’s
judgment of 23 November 2009 under Article 127 of the
Constitution. Its complaint (registered under file no. IV. ÚS
161/2010) was declared admissible on 8 April 2010 but the
proceedings were eventually discontinued on 3 June 2010
further to the withdrawal by company A. of its complaint.
(b) Petition of 4 February 2008
4 February 2008 company A. again sought judicial authorisation to
call an EGM of the applicant company’s members.
30 March 2009 the District Court allowed a fresh petition, following
which company A. called the EGM for 29 April 2010.
- The applicant company was the defendant in those
proceedings, being assisted by the State in the person of the
Ministry, acting as an intervenor for the defendant (vedľajší
its decision, the District Court relied, inter alia, on the
judgment of the Constitutional Court of 11 December 2007 (see
paragraph 21 above).
23 April 2009, upon motion of the State in the guise of the Ministry
of the Economy, the Prosecutor General challenged the decision of 30
March 2009 in the Supreme Court by way of an extraordinary appeal on
points of law. At the same time, the Prosecutor General requested
that the legal effect of the challenged decision be suspended pending
the outcome of the proceedings on the merits.
27 April 2009 the Supreme Court suspended the legal effect of the
decision of 30 March 2009 pending the outcome of the proceedings.
on 29 April 2009, the EGM took place.
20 May 2009 the Supreme Court quashed the decision of 30 March
2009 and remitted the matter to the District Court for
- The Supreme Court held, inter alia, that the
legal views expressed by the Constitutional Court in its judgment of
11 December 2007 (see paragraph 21 above) had no directly binding
legal effect upon the District Court.
9 September 2010, upon a complaint under Article 127 of the
Constitution by company A., the Constitutional Court found a
violation of the complainant’s right to a fair trial under
Article 6 § 1 of the Convention, quashed the judgment of the
Supreme Court of 20 May 2009 and remitted the matter to the Supreme
Court for a new determination of the extraordinary appeal by the
Constitutional Court found that there had been irregularities related
to the serving of a copy of the Prosecutor General’s
extraordinary appeal on company A. and that, in consequence, the
Supreme Court could not be said to have ensured service of that
appeal on company A. for observations, to the detriment of the
latter’s procedural rights.
further course and outcome (if any) of the proceedings in this matter
have not been made known to the Court.
4. Repercussions of the Constitutional Court’s
above-mentioned pronouncements of the Constitutional Court, and in
particular those in its judgment of 11 December 2007 (see paragraph 22
above), had been relied on by various parties in a number of
transactions and lawsuits concerning shares in the applicant company.
These include purported transfers of the litigious shares from
company A. and the other alleged shareholders (see paragraph 9 above)
to company B., incorporated in the Czech Republic, and then to
company C., incorporated in the United States of America, and
proceedings before the Bratislava Regional Court file nos. 27 Cb
77/2002, 7Cbs 86/2005, 7Cbs 84/05 and before the Košice
Regional Court file no. 2Cb 1272/2002.
B. Relevant domestic law
1. Constitution (Constitutional Law no. 460/1992 Coll.,
- Article 4 provides that:
“Mineral resources, caves, underground waters,
natural healing sources and streams are the property of the Slovak
- The relevant part of Article 20 §
2 reads as follows:
“An Act of Parliament shall determine which
property other than that indicated in Article 4 of this Constitution,
which is necessary for the safeguarding of the needs of society,
development of the national economy and public interest, may only be
owned by the State, a municipality or a specified legal entity.”
- Under Article 127:
“1. The Constitutional Court shall
decide complaints by natural or legal persons alleging a violation of
their fundamental rights or freedoms ... unless the protection of
such rights and freedoms falls within the jurisdiction of a different
2. If the Constitutional Court finds a
complaint justified, it shall deliver a decision stating that a
person’s rights or freedoms as set out in paragraph 1 have been
violated by a final decision, specific measure or other act and shall
quash such a decision, measure or act. If the violation that has been
found is the result of a failure to act, the Constitutional Court may
order [the authority] which has violated the rights or freedoms to
take the necessary action. At the same time it may remit the case to
the authority concerned for further proceedings, order that authority
to refrain from violating the fundamental rights and freedoms ... or,
where appropriate, order those who have violated the rights or
freedoms set out in paragraph 1 to restore the situation to that
existing prior to the violation.
3. In its decision on a complaint the
Constitutional Court may grant appropriate financial compensation to
a person whose rights under paragraph 1 have been violated.”
2. Constitutional Court Act (Law no. 38/1992 Coll., as
- Details concerning the status, structure and
functioning of the Constitutional Court and procedures before it are
defined in the Constitutional Court Act.
to its section 56(6):
“Should the Constitutional Court quash a final and
binding decision, measure or other interference and remit the matter
for further proceedings, the body which issued the decision, decided
on the measure or carried out other interference shall be bound
to e-examine the matter and to decide anew. In such proceedings
or process that body shall be bound by the legal view expressed by
the Constitutional Court.
3. Strategic Interests Act (Law no. 192/1995 Coll., as
- The Strategic Interests Act (Zákon
o zabezpečení záujmov štátu pri
privatizácii strategicky dôleZitých štátnych
podnikov a akciových spoločností) was
adopted with effect from 14 September 1995 and remained in force
until 12 October 1999. In the relevant part of section 2(3) it
“Shares in [the applicant company], which are held
or owned by the State or [the National Property Fund] cannot be
subject to privatisation.”
4. Privatisation Act (Law no. 92/1991 Coll., as
- The Privatisation Act (Zákon
o podmienkach prevodu majetku štátu na iné
osoby) regulates the conditions for transfer of property of the
State to legal entities and individuals. Under its section 10(2) the
privatisation of enterprises or their parts as well as of proprietary
interests in legal entities having the character of “natural
monopolies” must always be decided upon by the cabinet after
the matter has been debated in Parliament. The applicant company is
recognised as having the character of a “natural monopoly”
5. Joint-stock Companies
- The status, structure, organisation and functioning of
joint-stock companies is regulated by the Commercial Code (Law no.
513/1991 Coll., as amended), in particular by sections (Oddiel)
1 and 5, chapter (Hlava) 1 of its Part (Časť)
C. Related applications
- On 18 November 2008 and 20 April 2009 the Ministry of
the Economy of the Slovak Republic lodged two applications with the
Court, which were registered under application numbers 57425/08 and
- In applications numbers 57425/08 and 22213/09 the
Ministry was represented by Mr M. Krivák, a lawyer practising
in Bratislava (for comparison see paragraph 1 above).
on Article 34 of the Convention, the Ministry complained that the
course and outcome of the proceedings leading up to the
Constitutional Court’s judgment of 11 December 2007 (see
paragraph 21 above) and a decision of 22 May 2008, by which the
Constitutional Court had rejected the Ministry’s complaint
against the judgment of 11 December 2007, were contrary to its rights
under Article 6 § 1 of the Convention and Article 1 of Protocol
9 June 2009 the Court, sitting in the formation of a Committee under
former Article 28 of the Convention, declared applications numbers
57425/08 and 22213/09 inadmissible as being incompatible ratione
personae with the provisions of the Convention, within the
meaning of Article 34.
- The applicant company complained
under Article 6 § 1 of the Convention
that the proceedings before the Constitutional Court, leading up to
its judgment of 11 December 2007, had been unfair in that:
the Constitutional Court had given its own decision regarding
ownership of the litigious shares, while this matter had fallen
within the jurisdiction of the ordinary courts and outside the
jurisdiction of the Constitutional Court; and
the applicant company had not been a party to the proceedings before
the Constitutional Court and had had no impact on its decision
despite having a direct interest in the outcome of the proceedings.
applicant company complained that the proceedings before the
Constitutional Court leading up to its judgment of 11 December 2007
had been contrary to its rights under Article 6 § 1 of the
Convention, the relevant part of which provides as follows:
“In the determination of his civil rights and
obligations ... everyone is entitled to a fair ... hearing ...
by [a] ... tribunal ...”
Court considers that, first of all, it has to establish whether the
applicant company has standing to initiate proceedings on an
individual application under Article 34 of the Convention, which
“The Court may receive applications from any
person, non-governmental organisation or group of individuals
claiming to be the victim of a violation by one of the High
Contracting Parties of the rights set forth in the Convention or the
Protocols thereto. The High Contracting Parties undertake not to
hinder in any way the effective exercise of this right.”
- On that point, the Government submitted that, although
100% of the shares in the applicant company are now owned by the
State, at the time of the impugned judgment of the Constitutional
Court the State had only owned 51% of the shares.
applicant company was a private-law entity subject to the
jurisdiction of the ordinary courts and to the same legal regime as
any other commercial company in Slovakia. It did not have immunity,
did not carry out any public administration functions and did
not participate in the exercise of public power.
applicant company had professional management and its operations were
of a commercial nature. The State carried no liability for the
applicant company’s obligations and the applicant company was
subject to the normal rules and procedures concerning insolvency.
was true that the applicant company was the sole oil transporting
company in Slovakia. However, the territory of Slovakia was so small
that, in the free European market, it could not be considered
competitive territory. The applicant company’s market role had
therefore to be assessed with reference to oil-transporting companies
with the Czech Republic, Hungary, Austria and Ukraine as their
centres of their interest.
Government concluded that the question of the applicant company’s
standing under Article 34 of the Convention “raised serious
questions of interpretation and application of the Convention”.
applicant company, in reply, emphasised that it was neither
a public-law entity nor did it exercise any
public-administration powers. It held no special position within the
legal system of Slovakia and did not represent the Government in any
aspect of public life. In conclusion, relying on the Court’s
case-law, the applicant company submitted that it had standing to
bring an application under Article 34 of the Convention.
- The Court reiterates that a legal entity “claiming
to be the victim of a violation by one of the High Contracting
Parties of the rights set forth in the Convention and the Protocols
thereto” may submit an application to it, provided that it is a
“non governmental organisation” within the meaning
of Article 34 of the Convention and that the idea behind this
principle is to prevent a Contracting Party acting as both an
applicant and a respondent party before the Court (see, for example,
Islamic Republic of Iran Shipping Lines v. Turkey, no.
40998/98, § 81, ECHR 2007 V, and State Holding Company
Luganksvugillya v. Ukraine (dec.), no. 23938/05,
27 January 2009).
Court further reiterates that a company is “a non-governmental
organisation” if it is governed essentially by company law,
does not enjoy any governmental or other powers beyond those
conferred by ordinary private law in the exercise of its activities
and is subject to the jurisdiction of the ordinary rather than the
administrative courts (see Islamic Republic of Iran Shipping
Lines, § 81, cited above).
the past, the Court has also taken into account the fact that
an applicant company carried out commercial activities and had
neither a public-service role nor a monopoly in a
competitive sector. It has also held that it was not decisive that,
at a certain time, that applicant company was wholly owned by the
State (see Islamic Republic of Iran Shipping Lines, § 80,
term “governmental organisations”, as opposed to
“non governmental organisations” within the meaning
of Article 34, includes legal entities which participate in the
exercise of governmental powers or run a public service under
government control. In order to determine whether any given
legal person falls within that category, account must be taken of its
legal status and, where appropriate, the rights that status gives it,
the nature of the activity it carries out and the context in which it
is carried out, and the degree of its independence from the political
authorities (see, for example, Radio France and Others v. France
(dec.), no. 53984/00, ECHR 2003-X (extracts) and State
Holding Company Luganksvugillya, cited above).
Court observes that the applicant company in the present case has
features of both a “governmental” and a “non governmental
organisation” within the meaning of Article 34 of the
Convention and the case-law quoted above.
particular, the Court notes that, on the one hand, the applicant
company is a commercial joint-stock company operating exclusively
under the private-law regime, governed by the Commercial Code (see
paragraph 50 in the “Relevant domestic law” section
above); with no privileges or special rights or rules concerning
enforcement of judgments against it (for contrast, see State
Holding Company Luganksvugillya, cited above); subject to the
jurisdiction of the ordinary courts; not-participating in the
exercise of any governmental power; and, in the past, having been
partly owned by private entities (see paragraph 4 above).
Court also notes that, on the other hand, the State has always been a
majority shareholder and at present is the sole shareholder of the
applicant company; that on account of its strategic importance for
the national economy the applicant company used to be excluded by law
from privatisation (see paragraph 48 in the “Relevant domestic
law” section above); that the applicant company has been
recognised in the domestic law as having the character of a “natural
monopoly” (see paragraph 49 in the “Relevant domestic
law” section above); and that – as admitted by the
Government – the applicant company has an unrivalled market
position in Slovakia (see paragraph 58 above).
rather than weighting the elements mentioned in the precedent two
paragraphs against each other, the Court is of the opinion that the
decisive considerations for the determination of the locus standi
of the applicant company under Article 34 of the Convention in the
present case lie in the assessment of the overall procedural and
substantive context of the application and of its underlying facts.
that matter, the Court observes at the outset that the contested
judgment of the Constitutional Court was given on 11 December 2007
(see paragraphs 21 and 55 above) in the framework of the proceedings
initiated by a petition by company A. seeking judicial
authorisation for the calling of an EGM of the applicant company
(see paragraph 13 above).
Court also observes that the proceedings on the merits of that
petition were terminated on 19 August 2006, that is to say, prior to
the impugned judgment, following a withdrawal by company A. of its
petition as the subject-matter of the proceedings had become moot in
view of the EGM having already taken place (see paragraph 19 above).
Court considers that, in these circumstances, rather than the formal
subject-matter of the proceedings in question, that is to say, the
calling of the EGM of the applicant company, the genuine issue behind
this application appears to be the ownership of the shares in the
applicant company (see also paragraph 20 above).
the issue of the calling of the EGM could perhaps have involved the
determination of the applicant company’s “civil rights
and obligations” within the meaning of Article 6 § 1 of
the Convention (for contrast and comparison, see, mutatis
mutandis, Novotný v. the Czech Republic, no.
36542/97, Commission decision of 1 July 1998), the Court is of the
opinion that the question of ownership of the shares in the applicant
company primarily concerns the rights and interests of other
shareholders rather than the rights and interests of the applicant
Court observes that its stance expressed in the preceding paragraph
is supported, inter alia, by the fact that the State joined
the applicant company as an intervenor for the defendant in
proceedings involving the determination of essentially the same
issues as those in the proceedings contested in the present
application (see paragraph 33 above).
Court further considers that the unity of interests of the applicant
company, if any, and of the Government in the present case is
demonstrated by the fact that the latter, through the Ministry,
sought to contest the same judgment of the Constitutional Court
in applications submitted in reliance on Article 34 of the
Convention and dealt with by the Court under numbers 57425/08 and
22213/09 (see paragraphs 51 et seq. above).
the Court is of the view that this unity of interests is also
reflected in the tenor and content of the Government’s
arguments under Article 34 of the Convention (see paragraph 58
above) and the fact that the applicant company in the present case
and the Government in its applications numbers 57425/08 and 22213/09
were represented by the same lawyer (see paragraphs 1 and 52 above).
Court notes the incongruities of opinions of the Constitutional Court
and the Supreme Court as regards the binding effect upon the latter
of legal views expressed by the former in its judgments as well as of
their opinions on the merits of the case at hand (see paragraphs 25,
27, 29 and 39 above).
Court considers that, in the circumstances of the present case, the
interest of the applicant company, if any, and the interest of the
Government are the same, include the clarification of the
jurisdictional and legal incongruities referred to in the precedent
paragraph, and essentially involve the determination of the position
of third parties, including company A., in respect of the shares in
the applicant company.
Court notes, however, that its jurisdiction under Article 34 of the
Convention is limited to applications from “any person,
non governmental organisation or group of individuals claiming
to be the victim of a violation [...] of the rights set forth in the
Convention and the Protocols thereto.”
the extent the application has been substantiated, the Court has
found no indication that it strives to further interests other than
those that are concurrently interests of the State. This is, however,
not consonant with the principle of preventing “a Contracting
Party acting as both an applicant and a respondent party before
the Court” (see the case-law quoted in paragraph 60 above).
follows that, in the circumstances, the application is incompatible
ratione personae with the provisions of the Convention within
the meaning of Article 35 § 3 (a) and must be rejected
in accordance with Article 35 § 4.
conclusion is without prejudice to the applicant company’s
locus standi under Article 34 should the relevant
circumstances be different.
For these reasons, the Court unanimously
Declares the application inadmissible.
Santiago Quesada Josep