European Court of Human Rights

FOURTH SECTION

CASE OF INDUSTRIAL FINANCIAL CONSORTIUM INVESTMENT METALLURGICAL UNION v. UKRAINE

(Application no. 10640/05)

JUDGMENT

STRASBOURG

26 June 2018

This judgment will become final in the circumstances set out in Article 44 § 2 of the Convention. It may be subject to editorial revision.

In the case of Industrial Financial Consortium Investment Metallurgical Union v. Ukraine,

Vincent A. De Gaetano, President,
Ganna Yudkivska,
Faris Vehabović,
Egidijus KÅ«ris,

Carlo Ranzoni,
Georges Ravarani,
Marko Bošnjak, judges,
and Marialena Tsirli, Section Registrar,

PROCEDURE

THE FACTS

I. THE CIRCUMSTANCES OF THE CASE

A. Background to the case

1. Privatisation of Kryvorizhstal State Metallurgical Enterprise

2. The 2004 presidential election and the reprivatisation of Kryvorizhstal

13. The lawfulness and transparency of the privatisation of Kryvorizhstal was contested by the political opposition, whose leaders in 2004 were Mr V. Yushchenko, Mrs Y. Tymoshenko and Mr O. Moroz. In their public statements, they all accused President Kuchma, P. and A. of fraud, and called for the enterprise to be returned to the State.

14. During the 2004 presidential election campaign the issue was debated by two main rivals, Mr Yushchenko and Mr Yanukovych. Mr Yanukovych, whose candidature was openly supported by President Kuchma and A., insisted that the privatisation of Kryvorizhstal had been lawful and fair.

17. According to different media reports submitted by the applicant company, between January and April 2005 President Yushchenko and Prime Minister Tymoshenko made public statements that the privatisation of Kryvorizhstal had been unlawful, and that the enterprise would be returned to the State and subsequently resold.

18. In particular, in an interview of 26 January 2005 Prime Minister Tymoshenko said that "Ukrainian enterprises, like Kryvorizhstal, which had blatantly been stolen, had to be returned to the State."

19. On 4 February 2005 President Yushchenko made the following statement when addressing the Verkhovna Rada:

"...I promise that fair privatisation will be carried out this year. Those facilities which were stolen, starting with Kryvorizhstal, will be returned to the State ..."

20. On 12 February 2005 the Cabinet of Ministers revoked its decision of 6 August 2003 by which the privatisation of Kryvorizhstal had been launched. On 15 February 2005 the Fund also revoked its decisions concerning the privatisation.

21. On 8 June 2005 the State took control of Kryvorizhstal, pursuant to commercial court decisions declaring its privatisation unlawful (see paragraphs 51-53 and 56-57 below). By a decree of 11 June 2005, the Cabinet of Ministers declared the contract of 14 June 2004 invalid and withdrew the Kryvorizhstal shares from the applicant company.

3. Events after the 2004 election concerning one of the applicant company's owners

B. Proceedings before the courts of general jurisdiction instituted by private individuals

1. Proceedings instituted by N., S. and Kh.

27. On 28 May, 3 and 11 June 2004 respectively, three private individuals, N., a lawyer practising in Kyiv, S. and Kh., members of Parliament, lodged with the Golosiivskyy District Court of Kyiv three separate administrative law complaints against the decisions of the Fund and the State Commission on Securities and the Stock Market concerning the organisation of the 2004 bidding competition, contending that those decisions had violated the right of every citizen to participate in the privatisation of State property.

28. On an unspecified date the President of the Kyiv Court of Appeal transferred the case to the Pecherskyy District Court of Kyiv ("the Pecherskyy Court"). By separate decisions of 8 and 14 June 2004, the latter court refused to consider those complaints, and ordered that its decisions be immediately "enforced". No copy of those decisions was provided to the Court.

2. Proceedings instituted by I. and N.

30. On 14 June 2004 I., a private individual, and N. lodged with the Shevchenkivskyy District Court of Kyiv a claim against the Fund, the State Commission on Securities and the Stock Market, and ING Bank Ukraine, challenging the validity of their decisions and actions in connection with the privatisation of Kryvorizhstal. On an unspecified date the case was transferred to the Pecherskyy Court.

C. Proceedings before the commercial courts instituted by Consortium Industrial Group

32. On 25 June 2004 Consortium Industrial Group, the losing party in the 2004 bidding competition, instituted proceedings in the Kyiv Commercial Court against the applicant company, the Fund, the Ministry of Industrial Policy and the State Commission on Securities and the Stock Market, challenging the validity of the authorities' decisions adopted in connection with the privatisation of Kryvorizhstal and the contract of 14 June 2004. It contended that the 2004 bidding competition had been unlawful and unfair.

34. On 5 July 2004 the applicant company lodged a counterclaim against the other parties to the proceedings, asking the court to endorse its right to 93.02% of the Kryvorizhstal shares.

35. By a procedural ruling of 20 July 2004, the Kyiv Commercial Court found that the Office of the Prosecutor General had to participate in the proceedings, and ordered it to designate a representative in the proceedings. Notwithstanding that ruling, no prosecutor appeared before the Kyiv Commercial Court or the Higher Commercial Court in 2004.

37. On 19 August 2004 the Kyiv Commercial Court, having considered the arguments of Consortium Industrial Group in detail, dismissed them as unsubstantiated and found that the privatisation of Kryvorizhstal had been carried out in accordance with the relevant legislation. The court held, inter alia, that citizens' rights to participate in the privatisation had not been restricted, since they had been free to establish companies and participate in the competition through such companies. It also stated that the complaints by the private individuals against the competition had not been lodged in accordance with the law, and thus had had no suspensive effect. The court further endorsed the applicant company's property rights over the Kryvorizhstal shares, and banned any actions by the defendants which could violate these rights.

39. On 22 October 2004 the Higher Commercial Court held a hearing in the presence of the parties' representatives and upheld the judgment of 19 August 2004. The parties made no appeal to the Supreme Court against the decision of 22 October 2004.

40. On 7 February 2005 the Prosecutor General lodged a cassation appeal in the interests of the State with the Supreme Court, alleging that the contested decisions of the Kyiv Commercial Court and the Higher Commercial Court concerned the rights and obligations of the Cabinet of Ministers. The Prosecutor General sought an extension of the time-limit for lodging his appeal, stating, without giving any further details, that he had missed it since he had only become aware of the decision of 22 October 2004 in the course of examining a complaint by S. to the Prosecutor General. According to the Government, the Office of the Prosecutor General had received that complaint on 30 December 2004, and it had been directed mainly against the decision of the Higher Commercial Court of 22 October 2004.

41. In his appeal, the Prosecutor General mainly challenged the application of the law by the Kyiv Commercial Court and the Higher Commercial Court, and alleged that those courts' decisions had been inconsistent with a decision of the Supreme Court in a similar case. He also stated that the courts had failed to invite the Cabinet of Ministers to take part in the proceedings, although the subject matter had concerned its functions under the relevant privatisation regulations.

42. On 17 February 2005 the Supreme Court granted the extension requested and opened the proceedings on the merits of the Prosecutor General's cassation appeal. No copy of that procedural ruling was provided to the Court.

43. On 1 March 2005 the Supreme Court allowed the appeal by the Prosecutor General, quashed the decisions of the lower courts, and remitted the case for fresh consideration. It found that under Ukrainian law neither Consortium Industrial Group nor the applicant company had been eligible to participate in the 2004 bidding competition; that the competition had not been announced in due time, as required by law; and that the lower courts, when allowing the applicant company's counterclaim, had erred in applying the rules of procedure, which stated that no counterclaim could be lodged by a defendant against another defendant in the proceedings.

51. On 22 April 2005 the court delivered a judgment in the case whereby it allowed the claims of Consortium Industrial Group and the Office of the Prosecutor General, which it found to be of the same nature. It annulled the authorities' decisions concerning the 2004 privatisation and the contract of 14 June 2004, and ordered the Fund to return the money paid by the applicant company for the Kryvorizhstal shares. The applicant company's counterclaim was rejected, and it was ordered to return the shares to the Fund and pay UAH 1,903, the equivalent of about EUR 291 at the time, to the State for costs and expenses.

52. The court held that the Fund had failed to announce the competition in due time; that it had unlawfully introduced a condition concerning the production of charcoal and steel; that the Fund had failed to set out specific conditions of sale of certain number of the Kryvorizhstal shares outside the bidding competition; that the Fund's decisions issued between 8 and 14 June 2004 in relation to the competition had been invalid, as the complaints of three private individuals against the decisions concerning the organisation of the 2004 bidding competition had been ongoing before the courts during that period; and that the applicant company and Consortium Industrial Group had unlawfully been allowed to participate in the competition.

53. By a procedural ruling of 28 April 2005, the same court seized the shares at issue. On the same day, bailiffs started enforcement proceedings in respect of that ruling.

56. On 2 June 2005 the Kyiv Commercial Court of Appeal changed the judgment of 22 April 2005 in part. In particular, the appeal court found that the claims by Consortium Industrial Group had to be rejected, as it had not been eligible to participate in the 2004 bidding competition. The applicant company's appeal was dismissed as unsubstantiated.

57. By the same decision, the appeal court annulled the ruling of 28 April 2005 for non-compliance with the procedural rules, and refused to consider the applicant company's complaints against the bailiffs, on the basis that the matter fell outside its jurisdiction. The court further ruled to seize the Kryvorizhstal shares for the purpose of securing the claim by the Office of the Prosecutor General.

59. On 21 July 2005 the Higher Commercial Court rejected the applicant company's cassation appeal as unsubstantiated.

60. On 31 August 2005 a panel of three judges of the Supreme Court rejected the applicant company's further cassation appeal. No copy of that appeal was provided to the Court.

61. In the course of the proceedings before the commercial courts between February and June 2005 the applicant company challenged the impartiality of the judges and the courts dealing with its case on a number of occasions, alleging that their decisions and actions were influenced by government officials. According to the text of the judgment of the Kyiv Commercial Court of 22 April 2005 and the decision of the Kyiv Commercial Court of Appeal of 2 June 2005 (see paragraphs 51-52 and 56-‘57 above), the applicant company's procedural applications were rejected as unsubstantiated. No further explanation in that regard was given by the courts.

D. Public statements concerning the proceedings before the commercial courts instituted by Consortium Industrial Group

62. After 1 March 2005, and while the applicant company's case was being considered by the commercial courts, the President and the Prime Minister made a number of public statements concerning the proceedings. The applicant company submitted different media reports reproducing and/or interpreting those statements. The Government argued that some of the reports had not interpreted the statements accurately. In particular, they referred to the reports concerning the Prime Minister's press conference of 5 April 2005, at which she had made statements as to when the ongoing proceedings before the Kyiv Commercial Court might be completed.

63. According to a number of other reports, at a press conference of 11 April 2005 the Prime Minister said:

"... Facilities such as Kryvorizhstal ... I think that today the [authorities] are involved in the court proceedings concerning the return of those assets to the State. We are confident that we have a clear position [in relation to the case], and these enterprises will be returned to the State ..."

"... If the owners refuse to cooperate voluntarily, we will go down the legal route and will undoubtedly win [the case]. [However,] this will take several months...

The facility has been stolen, and the cost of that theft is several billion [United States] dollars. For me, this is a fact...

We prepare the terms of a new [bidding] competition..."

64. On 23 April 2005, commenting on the possibility that the applicant company could appeal against the judgment of 22 April 2005, the Prime Minister stated:

"... This will be an important decision by the appeal [court]. It will be evidence not only of the court's objectivity, but also of the [past] negotiations behind closed doors between various representatives from the authorities and the business..."

E. Proceedings before the courts of general jurisdiction instituted by Consortium Industrial Group

65. In July 2004 Consortium Industrial Group instituted proceedings in the Pecherskyy Court against the applicant company, the Fund, the Ministry of Industrial Policy and the State Commission on Securities and the Stock Market, challenging the validity of the authorities' decisions issued in connection with the privatisation of Kryvorizhstal and the contract of 14 June 2004. Consortium Industrial Group relied mainly on the same circumstances and considerations referred to in its claims before the commercial courts. Its claims before the courts of general jurisdiction contained an additional element - a challenge to the validity of T.'s appointment on 23 July 2004 as the applicant company's representative in the procedures following the 2004 bidding competition.

67. On 25 August 2004 the court delivered a judgment dismissing the claims of Consortium Industrial Group. For the most part, it contained identical reasons to those in the judgment of the Kyiv Commercial Court of 19 August 2004 (see paragraph 37 above).

68. On 1 and 27 December 2004 respectively the Kyiv Court of Appeal and a panel of three judges of the Supreme Court upheld the judgment of 25 August 2004.

70. N.'s application was dealt with by the same judge of the Pecherskyy Court who had sat in the main proceedings.

78. On 17 February 2005 the court allowed the application. It found that the right of every citizen, including that of N., to participate in privatisation and challenge its lawfulness had been confirmed by the judgment of the Constitutional Court of 1 December 2004. It also held that the ruling of 8 June 2004 on N.'s complaint concerning the 2004 competition had not entered into force at the time when the competition had taken place, and thus it could not have served as one of the grounds for rejecting the claims by Consortium Industrial Group.

F. Joined proceedings before the courts of general jurisdiction

81. On 28 February 2005, following an application by N., the Pecherskyy Court decided to examine the claims of I., N., and Consortium Industrial Group (see paragraphs 30 and 65 above) jointly, holding that they were of the same nature and concerned the same defendants.

82. On an unspecified date the applicant company lodged an application for review of the ruling of 17 February 2005 with the same court, in the light of newly discovered circumstances.

83. On 21 April 2005 the court granted the application by the applicant company, quashed the ruling of 17 February 2005, and rejected N.'s application of 9 February 2005 on the grounds that she had not participated in the original proceedings concerning the claims by Consortium Industrial Group.

84. By a separate ruling of the same date, the court rejected the claims by I. and N., finding that they had not participated in the 2004 bidding competition and did not have an arguable claim in respect of the subject matter of the proceedings. The court held that their claims represented a disguised attempt to settle a dispute between legal entities falling within the jurisdiction of commercial courts.

85. By decisions of 20 and 27 July 2005, the Kyiv Court of Appeal quashed the ruling of 21 April 2005, stating that, in the light of newly discovered circumstances, the ruling of 17 February 2005 was not to be reviewed, and that, with regard to Article 6 of the Convention, the Pecherskyy Court had unlawfully limited I.'s and N.'s right of access to a court.

86. On 15 October 2007 the Donetsk Regional Court of Appeal, acting as a court of cassation, upheld the decisions of 20 and 27 July 2005.

87. The case was remitted to the Pecherskyy Court, which on 6 February 2008 decided not to examine the claim of Consortium Industrial Group, because its representatives had failed to appear before the court.

II. RELEVANT DOMESTIC LAW AND PRACTICE

A. The 1991 Code of Commercial Procedure, as worded at the material time

89. Article 53 of the Code set out that, at the request of a party to proceedings or a prosecutor, or on its own initiative, a court could renew a time-limit if it considered that there were valid reasons for the time-limit being missed.

90. Under Articles 111-11, 111-14 and 111-16, a decision of the Higher Commercial Court had the force of law when delivered, but parties to proceedings and the Prosecutor General were entitled to lodge a cassation appeal with the Supreme Court within one month of the decision being delivered.

B. The 1963 Code of Civil Procedure (repealed on 1 September 2005)

93.  As set out in Article 4 of the Code, any interested person was entitled to apply to a court to defend a violated or disputed right or interest protected by law.

96. Article 347-3 of the Code contained a list of those who were entitled to apply for a review of judgments and court rulings in the light of newly discovered circumstances: parties to a case, other persons participating in proceedings, and prosecutors. They could do so within three months of discovering grounds for such a review.

C. Judgment of the Constitutional Court of 1 December 2004

99. The relevant provisions of the Constitutional Court's judgment read as follows:

"1... [The members of Parliament] of Ukraine lodged with the Constitutional Court of Ukraine an application for an official interpretation of the notion 'interest protected by law', as used in the first paragraph of Article 4 of the Code of Civil Procedure ..., and for an [official] explanation as to 'whether this notion concerns an individual's interest - a shareholder in a joint-stock company who applies to a court with a view to defending the violated rights of the joint-stock company ..., taking into account the fact that, because of the violation of the rights of the joint-stock company, the rights of the company's shareholder[s], as set out in the current legislation of Ukraine and/or the company's articles of association, have also been infringed'.

...

the Constitutional Court decided:

1. The notion 'interest protected by law' ... is to be understood as an inclination to use pecuniary and/or non-pecuniary benefits ... [an inclination] which is a distinct object of judicial protection and of other remedies aimed at satisfying individual and collective needs which are not contrary to the Constitution and laws of Ukraine, social interests, [the principles of] fairness, good faith, reasonableness, or other fundamental principles of law.

2. In the context of the question raised in the constitutional application, the provisions of the first paragraph of Article 4 of the Code of Civil Procedure of Ukraine are to be understood as meaning that a shareholder may defend his rights and interests protected by law through an application to a court if they are violated, disputed or not acknowledged by the joint-stock company [in which he or she holds shares], its organs or by other shareholders of that company.

The law shall determine the procedure of judicial protection of the joint-stock company's rights and interests ... violated by any person, including third parties, where those rights and interests are not considered to equate simply to the totality of the individual interests ... of its shareholders.

..."

THE LAW

I. ALLEGED VIOLATION OF ARTICLE 6 § 1 AND ARTICLE 13 OF THE CONVENTION

100. The applicant company complained, in its original application of 22 March 2005 which was subsequently amended on 21 June 2005, of a violation of Article 6 § 1 and Article 13 of the Convention, stating that after the 2004 election the proceedings concerning the 2004 bidding competition before the courts of general jurisdiction and the commercial courts had been conducted in an unfair manner.

101. Firstly, according to the applicant company, the principle of legal certainty had not been observed in those proceedings in view of (i) the annulment of the final judgment of the Pecherskyy Court of 25 August 2004 and the decisions of the Kyiv Court of Appeal and the Supreme Court of 1 and 27 December 2004; (ii) its case being reconsidered following an appeal by the Prosecutor General, who had not been a party to the proceedings, after being finally determined by the Higher Commercial Court on 22 October 2004; (iii) the failure of the Kyiv Commercial Court and the Commercial Court of Appeal to take into account the findings contained in the judgment of the Pecherskyy Court of 25 August 2004 as regards the same parties, facts and arguments; and (iv) the conflicting approaches to the interpretation of the relevant domestic law of the commercial courts and the courts of general jurisdiction dealing with its cases.

102. Secondly, the applicant company alleged that the review proceedings before the Pecherskyy Court in February 2005 had not been fair. In particular, it complained that the application to reopen the proceedings in the light of newly discovered circumstances had been lodged by a person who had not participated in the main proceedings, and that there had been no reason to reopen the case. It further alleged that the Pecherskyy Court had failed to respect the principle of equality of arms when considering that application, in that the applicant company's lawyers had not been promptly informed of the hearing of 16 February 2005 or provided with a copy of the application to reopen the proceedings, or the documents in support of that application. Consequently, they had not been able to prepare for that hearing and comment effectively on the merits of the application.

103. Thirdly, the applicant company stated that the proceedings before the Supreme Court in the period February-March 2005 had also been unfair, arguing that the Prosecutor General's cassation appeal had been considered on the merits, notwithstanding the fact that it had been lodged out of time.

104. Fourthly, the applicant company alleged that its lawyers had had no opportunity to put forward their arguments at the hearing of 23 March 2005 before the Kyiv Commercial Court, that journalists had not been allowed to attend that hearing, and that the judgment of 22 April 2005 lacked reasons.

105. Fifthly, the applicant company claimed that the courts dealing with its cases after the 2004 election had not been impartial and independent, and that their decisions which had been unfavourable to it had been politically motivated and influenced by top government officials. By making public statements concerning the ongoing proceedings, the authorities had violated Article 6 of the Convention.

106. In its submissions of 19 March 2008, the applicant company also complained regarding the unfavourable outcome of its application for review of the decision of the Pecherskyy Court of 17 February 2005, and of the failure of the authorities to inform it of the hearing of 21 July 2005 before the Higher Commercial Court, and the fact that the hearing had been held in the absence of its lawyers.

107. In its submissions of 7 July 2009, the applicant company further complained that there had been a violation of the principle of impartiality in the reopened proceedings in its case, in that the State authorities had revoked their decisions relating to the launch and conduct of the process privatising Kryvorizhstal while those proceedings had been ongoing (see paragraph 20 above).

"In the determination of his civil rights and obligations ... everyone is entitled to a fair ... hearing ... by an independent and impartial tribunal established by law."

A. Admissibility

1. Annulment of the final decisions and the reopening of the proceedings

(a) The parties' submissions

110. The Government argued that Article 6 § 1 of the Convention did not apply to the proceedings in question, as they had not been decisive for the applicant company's civil rights or obligations. In particular, the decisions of the commercial courts of 19 August and 22 October 2004, and the decisions of the courts of general jurisdiction of 25 August and 1 and 27 December 2004 (see paragraphs 37, 39, 67 and 68 above) rejecting the claims against the applicant company, had not changed its legal status as the owner of Kryvorizhstal. Nor had the quashing of those decisions resulted in a change in that status. Also, the applicant company's counterclaim in the commercial proceedings had not concerned a dispute, as it had been directed against different State bodies, which had not challenged the applicant company's title in respect of Kryvorizhstal and which procedurally had been the applicant company's co-defendants.

111. The Government further argued that the applicant company could not claim to be a victim regarding this part of its complaints, as the quashing of the court decisions at issue had not resulted in a change in the applicant company's legal status as the owner of Kryvorizhstal. Moreover, the claim by Consortium Industrial Group had ultimately been rejected by the courts of general jurisdiction in February 2008 (see paragraph 87 above). Also, the applicant company could not claim to have been in a state of uncertainty following the quashing of the decisions of the commercial courts of 19 August and 22 October 2004, as those decisions had been reconsidered in the course of the ordinary cassation procedure.

(b) The Court's assessment

116. In so far as the Government argued that the applicant company had no victim status as regards the quashing of the decisions in its favour (see paragraph 111 above), the Court considers that the Government's argument is closely linked to the substance of this part of the applicant company's complaints. Accordingly, their objection in this regard must be joined to the merits.

117. The Court further finds that the applicant company's complaints about the quashing of the final decisions in its cases in February 2005 are not manifestly ill-founded within the meaning of Article 35 § 3 (a) of the Convention and are not inadmissible on any other grounds. They must therefore be declared admissible.

2. Allegedly inconsistent decisions taken by the courts after the proceedings were reopened

118. In so far as the applicant company complained that the Kyiv Commercial Court and the Commercial Court of Appeal had failed to take into account the findings contained in the judgment of the Pecherskyy Court of 25 August 2004, the Court considers that this complaint has to be examined in the context of the applicant company's more general complaint relating to the fact that the dispute regarding the lawfulness of the 2004 privatisation had been dealt with by the courts in the framework of two "parallel" judicial procedures (see paragraph 101 above). While the existence of multiple parallel and interrelated proceedings concerning substantially the same legal issue may potentially have implications for compliance with the principle of legal certainty (see, for instance, Mullai and Others v. Albania, no. 9074/07, §§ 81, 86-88, 23 March 2010), the Court reiterates its finding that the dispute in the present case was finally resolved by the commercial courts, and the "parallel" proceedings before the courts of general jurisdiction were eventually discontinued (see paragraph 87 above). Although the applicant company argued that at some stage in those proceedings there had been some inconsistency between the decisions of the commercial courts and those of the courts of general jurisdiction, it has not been demonstrated that this was the case or that the alleged inconsistency persisted until the time when the matter was finally determined by the Supreme Court (see paragraph 60 above).

119. Accordingly, this part of the applicant company's complaints should be rejected as manifestly ill-founded pursuant to Article 35 §§ 3 (a) and 4 of the Convention.

3. Alleged non-compliance with the guarantees of independence and impartiality

(a) The parties' submissions

(i) The Government

121. The Government further argued that the applicant company had failed to exhaust domestic remedies as regards this part of the application, since it had not raised the issue of alleged bias in the domestic proceedings before the higher courts.

122. As to the proceedings before this Court, the Government stated that the applicant company had raised no complaint of bias on the part of the courts between 31 August 2005 and 28 February 2006, that is during the six months following the final determination of its case by the Supreme Court (see paragraph 60 above). The applicant company's complaints in that regard raised outside that period had to be rejected as lodged out of time.

123. According to the Government, the applicant company's allegations regarding a violation of the guarantees of independence and impartiality contained no complete and objective information about the statements by the politicians concerning the impugned proceedings. They were based on media reports containing incorrect interpretations of the statements, and the applicant company had misinterpreted some of the statements, in particular by saying that the Prime Minister had said that the proceedings "would" be finished by a certain date (see paragraph 62 above). Also, the applicant company had failed to demonstrate how the politicians' statements had influenced the courts in the present case. For those reasons, the Government submitted that the applicant company's allegations were manifestly ill-‘founded.

(ii) The applicant company

125. The applicant company also contended that its appeals to the Higher Commercial Court and the Supreme Court had provided no effective remedy, since the judgment of the Kyiv Commercial Court of 22 April 2005 had become effective on 2 June 2005, and the State authorities had started the reprivatisation process before the higher courts had examined its appeals.

(b) The Court's assessment

129. As to the Government's objection as to non-exhaustion (see paragraph 121 above), the Court notes that the applicant company raised its complaints of a violation of the principle of impartiality before the Kyiv Commercial Court and the Kyiv Commercial Court of Appeal. Those courts rejected its complaints as unsubstantiated, providing no reasons for their decision (see paragraph 61 above). Even assuming that the applicant company did not maintain those complaints before the Higher Administrative Court and the Supreme Court, there is no information demonstrating that the alleged violation of the principle of impartiality could have been remedied in the proceedings before those courts. Nor did the Government submit a specific example showing similar complaints having been remedied in the course of those types of proceedings (see, mutatis mutandis, Sovtransavto Holding v. Ukraine (dec.), no. 48553/99, 27 September 2001). Therefore, the Government's objection as to non-exhaustion should be dismissed.

131. In so far as the Government argued that the applicant company had failed to demonstrate how those statements had influenced the courts (see paragraph 123 above), this objection is closely linked to the substance of the applicant company's complaints. Therefore, it must be joined to the merits.

132. On the whole, the Court finds that the applicant company's complaints regarding a breach of the guarantees of independence and impartiality in the proceedings before the commercial courts in 2005 are not manifestly ill-founded within the meaning of Article 35 § 3 (a) of the Convention and are not inadmissible on any other grounds. They must therefore be declared admissible.

4. The applicant company's remaining complaints under Article 6 § 1 of the Convention

B. Merits

1. The parties' submissions

(a) The Government

(i) The quashing of the final decisions in its cases and the subsequent reopening of the proceedings in February 2005

(ii) Alleged non-compliance with the guarantees of independence and impartiality

(b) The applicant company

(i) The quashing of the final decisions in its cases and the subsequent reopening of the proceedings in February 2005

(ii) Alleged non-compliance with the guarantees of independence and impartiality

2. The Court's assessment

(a) General principles

(i) The quashing of final decisions

"51. ... [T]he right to a fair hearing before a tribunal as guaranteed by Article 6 § 1 of the Convention must be interpreted in the light of the Preamble to the Convention, which, in its relevant part, declares the rule of law to be part of the common heritage of the Contracting States. One of the fundamental aspects of the rule of law is the principle of legal certainty, which requires, among other things, that where the courts have finally determined an issue, their ruling should not be called into question (see Brumărescu, cited above, § 61).

52. Legal certainty presupposes respect for the principle of res judicata (ibid., § 62), that is the principle of the finality of judgments. This principle underlines that no party is entitled to seek a review of a final and binding judgment merely for the purpose of obtaining a rehearing and a fresh determination of the case. Higher courts' power of review should be exercised to correct judicial errors and miscarriages of justice, but not to carry out a fresh examination. The review should not be treated as an appeal in disguise, and the mere possibility of there being two views on the subject is not a ground for re-examination. A departure from that principle is justified only when made necessary by circumstances of a substantial and compelling character."

(ii) The guarantees of independence and impartiality

(b) Application of the general principles to the present case

(i) Proceedings before the courts of general jurisdiction

(ii) Proceedings before the commercial courts

(iii) Conclusion

167. In the light of the foregoing considerations, the Court finds that the decisions leading to the annulment of the decisions of the courts of general jurisdiction of 25 August and 1 and 27 December 2004, and the decisions of the commercial courts of 19 August and 22 October 2004, infringed the principle of legal certainty and the applicant company's related legitimate interest of respect for the final determination of its civil rights in those proceedings. The impugned proceedings, seen as a whole and taking into account the statements made by the President and the Prime Minister between January and April 2005, did not meet the requirements of fairness within the meaning of Article 6 § 1 of the Convention. Accordingly, the Court rejects the Government's objections as regards the applicant company's victim status and its concerns as to the independence and impartiality of the commercial courts dealing with its case, which have been previously joined to the merits (see paragraphs 116 and 131 above) and considers it unnecessary to examine the applicant company's other complaints relating to the quashing of those decisions in the context of this part of the case (see paragraphs 102 and 103 above).

II. ALLEGED VIOLATION OF ARTICLE 1 OF PROTOCOL NO. 1 TO THE CONVENTION

169. The applicant company complained of a violation of Article 1 of Protocol No. 1 on account of (i) the authorities' alleged failure to ensure that it could enjoy its possessions in accordance with the final and binding decisions issued in its cases before January 2005; (ii) the quashing of those decisions in February 2005 and various shortcomings in the related proceedings (see paragraphs 102 and 103 above); (iii) the allegedly inconsistent decisions taken by the courts after the reopening of the proceedings in 2005; and (iv) the alleged lack of independent and impartial reconsideration of its cases in 2005. The applicant company also complained that it had been deprived of its assets - 93.02% of the Kryvorizhstal share capital - unlawfully because of one of its owners' political opposition to the authorities, and that the authorities had failed to reimburse it for the improvements it had made to those assets. Article 1 of Protocol No. 1 reads as follows:

"Every natural or legal person is entitled to the peaceful enjoyment of his possessions. No one shall be deprived of his possessions except in the public interest and subject to the conditions provided for by law and by the general principles of international law.

The preceding provisions shall not, however, in any way impair the right of a State to enforce such laws as it deems necessary to control the use of property in accordance with the general interest or to secure the payment of taxes or other contributions or penalties."

A. Admissibility

1. The parties' submissions

(a) The Government

(b) The applicant company

2. The Court's examination

B. Merits

191. Notably, the applicant company argued that Article 1 of Protocol No. 1 had been violated because of the annulment of the final decisions in its civil and commercial cases in February 2005. In this regard, the Court notes that it has found that the annulment at issue was in violation of the requirement of legal certainty under Article 6 § 1 of the Convention (see paragraph 167 above). However, the situation in the present case differs from the vast majority of cases in which the Court has found violations of Article 1 of Protocol No. 1 as regards the annulment of final and binding decisions (see, for example, Agrotehservis v. Ukraine, no. 62608/00, 5 July 2005, and Timotiyevich v. Ukraine, no. 63158/00, 8 November 2005).

192. In the present case, the domestic judicial decisions whose annulment the Court has held to be contrary to the principle of legal certainty did not directly provide for a transfer of the title in respect of the Kryvorizhstal share capital or the shares to the applicant company. At the time the courts examined the cases in 2004 the applicant company was formally and actually in possession of the assets in dispute. Although the commercial courts also endorsed the applicant company's title in respect of those assets and banned any actions capable of violating that title, no party was required to take specific action in that regard (compare and contrast with Ivanova v. Ukraine, no. 74104/01, § 37, 13 September 2005, in which the defendant in the original proceedings had been ordered to take specific action in order not to impede the applicant's enjoyment of her property).

195. In any event, in the present case the decisions resulting in the reopening of the proceedings in the applicant company's case cannot be taken in isolation. Regard must be had to the fact that the applicant company, unlike the applicants in the cases of Agrotehservis, Ivanova and Timotiyevich, cited above, was eventually awarded and actually paid compensation for its lost assets. While the applicant company argued that that sum had not covered the damage it had sustained as a result of being deprived of its assets, no evidence was submitted in support of that argument.

III. OTHER ALLEGED VIOLATIONS OF THE CONVENTION

IV. APPLICATION OF ARTICLE 41 OF THE CONVENTION

"If the Court finds that there has been a violation of the Convention or the Protocols thereto, and if the internal law of the High Contracting Party concerned allows only partial reparation to be made, the Court shall, if necessary, afford just satisfaction to the injured party."

A. Damage

1. The parties' submissions

(a) The applicant company

(b) The Government

(c) The third-party intervener

2. The Court's examination

B. Costs and expenses

FOR THESE REASONS, THE COURT, UNANIMOUSLY,

1. Joins to the merits the Government's objection as to the applicant company's victim status in respect of its complaints under Article 6 § 1 of the Convention about the quashing of the final court decisions favourable to it in February 2005, and rejects it;

2. Joins to the merits the Government's objection that the applicant company's complaint under Article 6 § 1 of the Convention regarding a breach of the guarantees of independence and impartiality in the proceedings before the commercial courts between February and August 2005 was manifestly ill-founded, and rejects it;

3. Declares the following complaints admissible:

(a) the applicant company's complaints under Article 6 § 1 of the Convention about the quashing of the final court decisions favourable to it in February 2005; and

(b) the applicant company's complaint under Article 6 § 1 of the Convention regarding a breach of the guarantees of independence and impartiality in the proceedings before the commercial courts between February and August 2005; and

(c) the applicant company's complaints under Article 1 of Protocol No. 1 that the proceedings concerning its assets - 93.02% of the Kryvorizhstal share capital - had been conducted in the unfair manner and that the authorities had failed to reimburse it for the improvements it had made to those assets;

4. Declares the remainder of the application inadmissible;

5. Holds that there has been a violation of Article 6 § 1 of the Convention;

6. Holds that there has been no violation of Article 1 of Protocol No. 1;

7. Dismisses the applicant company's claim for just satisfaction.

Done in English, and notified in writing on 26 June 2018, pursuant to Rule 77 §§ 2 and 3 of the Rules of Court.

Marialena TsirliVincent A. De Gaetano
Section RegistrarPresident