FOURTH SECTION
DECISION
Application no. 29372/09
by Kari HUOVINEN and EKOSTYLE OY
against Finland
The European Court of Human Rights (Fourth Section), sitting on 31 August 2010 as a Committee composed of:
	David Thór Björgvinsson, President,
	Päivi Hirvelä,
	Mihai Poalelungi, judges,
and Fatoş AracıDeputy Registrar,
Having regard to the above application lodged on 28 May 2009,
Having regard to the formal declarations accepting a friendly settlement of the case,
Having deliberated, decides as follows:
THE FACTS
The applicant, Mr Kari Huovinen, is a Finnish national who was born in 1948 and lives in Helsinki. The applicant company, Ekostyle Oy, is a Finnish limited liability company which has its seat in Espoo. The Finnish Government (“the Government”) were represented by their Agent, Mr Arto Kosonen of the Ministry for Foreign Affairs.
The circumstances of the case
The facts of the case, as submitted by the parties, may be summarised as follows.
Proceedings concerning the applicant company
A. The tax inspection
The applicant company, of which the first applicant is the managing director and a member of the board of directors, was subject to a tax inspection in 2000. In that context the first applicant told the tax office that real estate bought by the applicant company might previously have been linked to money laundering activities.
The tax inspectors found that the applicant company's book-keeping was not done in a proper manner, especially as concerned value-added tax during the years 1998 to 2000. The tax inspectors proposed that some expenses of the applicant company's taxation be considered as disguised dividends given to the first applicant by the company and that corrections be made to the calculation of the value-added tax.
By letter dated 6 November 2000 the provisional inspection report was sent to the applicant company for comments. On 30 November 2000 the applicant company submitted its comments thereon.
By letter dated 31 January 2001 the conclusions of the final inspection report, dated 12 January 2001, were sent to the applicant company for comments. They contained proposals for changes to be made to the applicant company's taxation as well as mentioning that additional taxes and tax surcharges () would be imposed. On 16 February 2001 the applicant company submitted its observations on the inspection report, contesting its accuracy.
On 11 April and 23 May 2002 the applicant company complained about the tax inspection to the local tax office.
real estate bought by it had previously been linked to money laundering activities. It is not known whether the police conducted any investigation into the matter.
B. The disguised dividends
The disguised dividends, found during the tax inspection, were taken into account in the applicant company's taxation for the tax year 2000.
By letters dated 24 April and 15 May 2001 the applicant company sought rectification from the local tax office disguised dividends and the tax surcharges caused thereby, as well as
On 23 May 2001 the local tax office stayed the seizure proceedings concerning the final tax for the tax year 2000, imposed on the applicant company.
the local tax office decided to rectify the applicant company's taxation for the tax year 2000 by annulling the disguised dividends.
C. The value-added tax
On 11 August, 11 October and on 2 and 13 November 2000, while the tax inspection was still pending, the local tax office made several decisions and rectifications concerning the value-added tax, imposing on the applicant company additional taxes and tax surcharges. Concerning the month of December 1999, the local tax office estimated the amount of value-added tax on 11 August 2000 because no tax return had been submitted by the applicant company. On 13 November 2000, after having received a tax return, the tax office modified their earlier decision and set the tax to be paid.
On 13 June 2001 the local tax office, relying on the finalised tax inspection report, made two decisions concerning additional value-added tax for the months of April, May and December 1999. Both decisions contained an obligation for the applicant company to pay additional taxes as well as tax surcharges.
On 3 July 2001 the applicant company requested that the seizure proceedings be stayed. This request was refused by the local tax office on 13 July 2001.
(hallinto-oikeus, förvaltningsdomstolen), complaining about the tax inspection and requesting that the decision made on 13 June 2001 concerning the value-added tax for the month of December 1999 be quashed.
On an unspecified date the applicant company also requested that the Helsinki Administrative Court stay the seizure proceedings concerning the two decisions on value-added tax made on 13 June 2001.
On 7 September 2001 Helsinki Administrative Court refused the applicant company's application for an interim measure. Moreover, it indicated that the value-added tax for the months of April and May 1999 had already been paid.
By letter dated 17 September 2001 the applicant company renewed its request for an interim measure in respect of the seizure proceedings which now concerned only the value-added tax for the month of December 1999.
On 21 September 2001 the Helsinki Administrative Court stayed the seizure proceedings concerning the said value-added tax.
 by the local tax officeDecember 1999 
(
On 29 August 2002 the Supreme Administrative Court refused the applicant company leave to appeal.
local tax office re-examined the December 1999 and lowered the amount of tax and tax surcharges payable.
the local tax office rectified the value-added tax for the month of May 2000 and lowered the amount of tax and tax surcharges payable.
By letters dated 14 February and 14 March 2003 the applicant company appealed to the Helsinki Administrative Court in respect of the decisions of 13 June 2001, 9 October and 16 December 2002 requesting, inter alia, that an oral hearing be held.
On 10 September 2004 the Helsinki Administrative Court partly dismissed the complaints without examining the merits, partly rejected them. It also rejected the request for an oral hearing as manifestly unnecessary, finding that it would not have added anything to the case file.
By letter dated 28 October 2004 the applicant company appealed to the Supreme Administrative Court, renewing its claims and reiterating the grounds of appeal relied on before the Helsinki Administrative Court.
On 16 December 2005 and on 16 and 18 January 2006 the applicants asked the police to investigate whether the measures taken by the local tax office, the Helsinki Administrative Court and the Supreme Administrative Court constituted a crime.
On 10 and 25 January 2006 the police decided to not to start a pre-trial investigation in the case as there was no suspicion of any crime.
On 22 August 2006 the Supreme Administrative Court granted the applicant company leave to appeal and found that an oral hearing could not be regarded as manifestly unnecessary. It thus quashed the Helsinki Administrative Court's decision of 10 September 2004 and referred the case back to it for an oral hearing. Moreover, it stated that the Helsinki Administrative Court was to take into account that the first applicant had requested in the Supreme Administrative Court that his and the company's taxation issues be dealt with together.
The applicant company and the first applicant noticed some mistakes in the Supreme Administrative Court's decision of 22 August 2006 and they informed the court about them. On 11 January 2007 the court decided not to annul the decision of 22 August 2006.
On 13 and 26 February 2007 the applicant company claimed that the Helsinki Administrative Court was not impartial to examine its case.
On 14 June 2007 the Helsinki Administrative Court held an oral hearing involving both the applicant company and the first applicant.
On 20 September 2007 the Helsinki Administrative Court, inter alia, accepted the applicant company's appeal concerning the value-added tax for the month of December 1999, quashed the decision of 11 August 2000 and referred the matter back to the local tax office for a new examination. The court was unable to examine as a first instance whether the estimate of the value-added tax of 11 August 2000 and the decision of 13 November 2000 were still in force.
On 25 October 2007 the local tax office, by referring to the Helsinki Administrative Court's decision of 20 September 2007, upheld the decision of 11 August 2000.
On 17 November 2007 the applicant company, together with the first applicant, appealed to the Supreme Administrative Court, requesting leave to appeal.
On 12 December 2008 the Supreme Administrative Court refused the applicant company leave to appeal.
On 11 March 2009 the local tax office, by referring to the Helsinki Administrative Court's decision of 20 September 2007, quashed the decision of 11 August 2000.
It is not known whether the proceedings are still pending.
Proceedings concerning the first applicant
By letter dated 31 January 2001 the conclusions of the final inspection report, dated 12 January 2001, were sent to the first applicant for comments. They contained proposals for changes to be made to his taxation as well as mentioning that additional taxes and tax surcharges would be imposed.
By letter dated 19 March 2001 the first applicant was informed by the local tax office that, as a result of the tax inspection, disguised dividends would be added to his personal taxation for the tax year 1999. However, on 28 March 2001 the local tax office decided not to impose taxes retroactively on the first applicant as the disguised dividends as well as the tax surcharges had already been taken into account in the regular tax proceedings.
On 15 and 30 December 2005 the first applicant asked the local tax office to rectify his taxation for the tax years 1996 and 1999.
On 26 January 2006 the local tax office dismissed the request for rectification concerning the tax year 1996 without examining the merits, as it was made out of time.
On 17 May 2006 the local tax office rejected the appeal concerning the tax year 1999.
By letters dated 1 March, 3 February and 3 and 18 May 2006 the first applicant requested the Supreme Administrative Court to quash the rectification decisions of 26 January and 17 May 2006 and requested that the court deal with his and the company's taxation issues together.
On 22 August 2006 the Supreme Administrative Court dismissed the complaints without examining the merits. As the first applicant had not appealed first to the Administrative Court, the Supreme Administrative had no competence to examine the case. However, as the court had on the same date quashed the Helsinki Administrative Court's decision of 10 September 2004 in respect of the applicant company and referred it back for an oral hearing, the Helsinki Administrative Court was to take into account that the first applicant had requested in the Supreme Administrative Court that his and the company's taxation issues be dealt with together.
The first applicant and the applicant company noticed some mistakes in the Supreme Administrative Court's decision of 22 August 2006 and they informed the court about them. On 11 January 2007 the court decided not to annul the decision of 22 August 2006.
On 14 June 2007 the Helsinki Administrative Court held an oral hearing involving both the first applicant and the applicant company.
On 20 September 2007 the Helsinki Administrative Court dismissed the first applicant's complaint, concerning the tax year 1996, without examining the merits as it was made out of time, and rejected the complaint concerning the tax year 1999.
On 17 November 2007 the first applicant, together with the applicant company, appealed to the Supreme Administrative Court, requesting leave to appeal.
On 12 December 2008 the Supreme Administrative Court refused the first applicant leave to appeal.
COMPLAINTS
1.  The applicants complained under Article 6 § 1 of the Convention that t
2.  They complained under the same Article that the Helsinki Administrative Court had not been impartial, when taking the decision of 20 September 2007, due to its prior involvement in the case.
3.  They complained under Article 6 § 3 (a) and (d) that the tax office and the domestic courts had used several different bases for the tax and that they did not match the sanctions imposed.
4.  The applicants complained under the same Article that the Helsinki Administrative Court had failed to invite all their witnesses to an oral hearing.
5.  Lastly, they complained under Article 13 that they had not had an effective remedy as the tax office had failed to report the suspected money laundering to the police and the police had failed to investigate it.
THE LAW
A.  Length of the administrative proceedings
The applicants complained under Article 6 § 1 of the Convention about the excessive length of their administrative proceedings.
 On  28 May 2010 and 9 June 2010 the Court received friendly settlement declarations signed by the parties under which the applicants agreed to waive any further claims against Finland in respect of the facts giving rise to this application against an undertaking by the Government to pay them 3,850 euros to cover any non-pecuniary damage as well as costs and expenses, which would be free of any taxes that may be applicable. It would be payable within three months from the date of notification of the decision taken by the Court pursuant to Article 37 § 1 of the European Convention on Human Rights. In the event of failure to pay this sum within the said three-month period, the Government undertook to pay simple interest on it, from expiry of that period until settlement, at a rate equal to the marginal lending rate of the European Central Bank during the default period plus three percentage points. The payment would constitute the final resolution of the case.
The Court takes note of the friendly settlement reached between the parties. It is satisfied that the settlement is based on respect for human rights as defined in the Convention and its Protocols and finds no reasons to justify a continued examination of this part of the application (Article 37 § 1 in fine of the Convention).
In of the above, it is appropriate to strike this part of the case out of the list.
B.  Remainder of the application
It follows that this complaint must be rejected as being manifestly ill-founded within the meaning of Article 35 §§ 3 and 4 of the Convention.
It follows that this complaint must be rejected as being manifestly ill-founded within the meaning of Article 35 §§ 3 and 4 of the Convention.
Article 6 § 1 of the Convention does not give an applicant an absolute right to have all his or her witnesses heard (see for example M.A. v. Austria, no. 23228/94, 11 May 1994). It follows that also this complaint must be rejected as being manifestly ill-founded within the meaning of Article 35 §§ 3 and 4 of the Convention.
Lastly, thven though the tax office would have failed to report a crime, the applicants had a possibility to do so themselves, which they in fact did on 5 May 2004. Even assuming that the police did not start the investigations, the applicants had a possibility, according to the Criminal Procedure Act, to press charges themselves which they failed to do. In any event, the applicants have no right to obtain a prosecution against third persons. It follows that this complaint must be rejected as being incompatible ratione materiae with the Convention, within the meaning of Article 35 §§ 3 and 4 of the Convention.
For these reasons, the Court unanimously
Decides to strike the application out of its list of cases in so far as it relates to the excessive length of the administrative proceedings;
Declares the remainder of the application inadmissible.
	Fatoş Aracı	David Thór Björgvinsson
	Deputy 	President