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MINISTERS’ DEPUTIES |
Notes on the Agenda |
2 December 2021 |
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1419th meeting, 30 November – 2 December 2021 (DH) Human rights
H46-28 S.C. Polyinvest S.R.L. and Others v. Romania (Application No. 20752/07) and similar cases Supervision of the execution of the European Court’s judgments Reference documents DH-DD(2021)1138, CM/ResDH(2021)194, CM/ResDH(2020)182, CM/Del/Dec(2020)1411/H46-28 |
Case description
These six judgments cover, inter alia, nine applications concerning the non-implementation of domestic court decisions or arbitral awards given between 2000 and 2011, which ordered State-controlled companies to pay various amounts to the applicant parties (violations of Article 6 § 1 and of Article 1 of Protocol No. 1).
Status of execution
Individual measures:
In all but one of the cases,[1] the Court indicated in the operative provisions of the judgments that Romania was to ensure, by appropriate means, the enforcement of the court or arbitral decisions in favour of the applicants within three months of the notification of its judgments.[2]
These time-limits expired between June 2015 and May 2019. To date, none of these decisions has been fully implemented and the debtor companies have been wound up or are in bankruptcy.
In May and June 2019 respectively, the Court refused the respondent State’s requests for interpretation of the operative provisions of the judgments in S.C. Polyinvest S.R.L. and Others and Zlatin and Others, which concerned five of these applications, on the ground that there was no reason to warrant considering them.
The Committee has examined in detail the issue of the non-payment of the sums owed to the applicants under the relevant court or arbitral decisions at all but one of its human rights meetings since June 2019 (in S.C. Polyinvest S.R.L. and Omegatech Enterprises Ltd.) and December 2019 (in the other applications). It has firmly and repeatedly insisted on Romania’s unconditional obligation to abide by the Court’s judgments and made increasingly urgent calls to the authorities to proceed to the required payments.
In the absence of payment, the Committee adopted interim resolutions in September 2020 (CM/ResDH(2020)182), and September 2021 (CM/ResDH(2021)194). In the latter, the Committee again underlined that to fulfil its unconditional obligation under Article 46 of the Convention to abide by the Court’s judgments in these cases, Romania is required to pay, from State funds, all the sums due, granted in the court decisions or arbitral awards, with default interest up to the date of the payment, whether as specified in the decisions or awards or, failing such specification, together with the statutory interest due under domestic law. The Committee strongly exhorted the authorities to urgently secure redress to the applicants for the violations by making the required payments without any further delay. It also urged them to keep it duly informed of all relevant developments and decided to resume consideration of the individual measures in these cases at the present meeting.
In their submissions as of September 2020, the authorities have referred to ongoing steps to amend the national legislation, which they consider necessary in order to make the payments. On 29 October 2021 they provided updated information about these steps. They indicate that a first solution promoted by the Ministry of Foreign Affairs did not receive support from the Ministry of Finance. Following exchanges between these Ministries, an alternative proposal has been developed. Both will be submitted to the Prime Minister, who will decide which is to be put to the government for adoption (either can be implemented by an act of government). For the time being, this process is on hold, as the government’s term of office came to an end following a no-confidence vote in Parliament in October this year; it will be resumed once a new government is sworn in.
More in detail, the first solution is to amend the government regulation laying down the procedure for the payment of sums awarded by the Court as just satisfaction to make it applicable also to the payment of sums owed by state-controlled companies to applicants in these and any possible future similar cases. The second proposal is to adopt an emergency government regulation establishing a mechanism whereby the payment of the sums owed to the applicants, including the default interest accrued, will be made by the authorities exercising administrative supervision over state-controlled companies which have been wound up or are in bankruptcy (see DH-DD(2021)1138).
The Committee has received several communications from the applicant companies in Omegatech Enterprises Ltd. and RJ Import Roger Jaeger A.G. and RJ Import Bucureşti S.A. and from Messrs Iordan and Beşleagă. They complain about the delay and request the immediate payment of the sums due to them pursuant to the court decisions or arbitral awards at issue.[3]
The authorities indicated that the applicant RJ Import Bucureşti S.A. recovered a part of this sum in the procedure for liquidation of the debtor company’s assets, which was brought to a close in December 2017 (see DH-DD(2019)133).
General measures:
The measures required to guarantee non-repetition of the violations are examined in the framework of the Săcăleanu group of cases.
Analysis by the Secretariat
In conformity with the decision taken by the Committee at its 1411th meeting (September 2021) (DH), the present analysis focuses on the individual measures in these nine applications, namely the payment, from State funds, of all the sums due to the applicants, granted in the court decisions or arbitral awards, with default interest up to the date of the payment.
Most regrettably, these payments have still not been made.
As stressed by the Committee, including in Interim Resolution CM/ResDH(2021)194 adopted at the last examination, the authorities are long overdue in securing redress to the applicants for the violations found, as they are bound to do to comply with Romania’s unconditional obligation under Article 46 § 1 of the Convention to abide by these judgments.
The Committee has concluded that the payments could be made without legislative change, as the Convention is part of domestic law and provides the legal basis for the payments. Since, nonetheless, the Romanian authorities have decided it was necessary to create a specific legal basis,this should have been established without any delay. It is regrettable that after so long a time since the judgments became final, the steps that the authorities insist are necessary to make the payments, ongoing for well over a year, have still not been completed and that there is still no clear and near prospect of redress for the applicants.
As regards the two alternative avenues considered by the authorities to secure redress, it appears that in the second proposal the obligation to make the payments could fall either to the local authorities or to a central government agency,[4] based on the nature of the public shareholder in the debtor state-controlled companies.[5] The Committee has received information in another case,[6] that this agency was facing financial difficulties, which made it necessary for it to request funds from the central government to honour its debts, including that owed to the applicant company in that case. Should the authorities choose to pursue this second approach in the present cases, it is essential for them to guarantee that the government entity or agency responsible to pay the sums owed under these judgments will have sufficient funds so that these payments can be made immediately.
It remains therefore necessary that the authorities settle this matter without any further delay, in strict compliance with Romania’s obligations as a Contracting Party to the Convention. The Secretariat as always is available for consultations and assistance should the authorities wish to avail themselves of this.
In accordance with the decisions adopted at its 1398th meeting (March 2021) (DH) in the Săcăleanu group, of which these cases are part, the Committee is due to resume their examination at its 1428th meeting (March 2022) (DH).
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Financing assured: YES |
[1] RJ Import Roger Jaeger A.G. and RJ Import Bucureşti S.A.
[2] Although in RJ Import Roger Jaeger A.G. and RJ Import Bucureşti S.A. the Court did not consider it necessary to provide such specific indications, the execution of the domestic court decision is also required in this case since Romania is in any event bound under Article 46 of the Convention to put an end to the continuing violations found by the Court and to redress so far as possible their effects (see CM/Notes/1362/H46-20).
[3] The applicant companies estimated the sums owed to them to total USD 4,665,912.03 as of 29 March 2018 (Omegatech Enterprises Ltd.) and EUR 6,744,987 as of 27 July 2020 (RJ Import Roger Jaeger A.G. and RJ Import Bucureşti S.A.).
[5] Law No. 15/1990 on the reorganisation of State-owned economic entities.
[6] S.C. Bit S.A., Application No. 2804/12, judgment Buti and Others, examined in the Săcăleanu group (see CM/Notes/1398/H46-23).