Criminal proceedings against Silvio Berlusconi (C-387/02), Sergio Adelchi (C-391/02) and Marcello Dell'Utri and Others (C-403/02).

• Jurisdiction: European Union
• Court: Court of Justice (European Union)
• Date: 14 October 2004

OPINION OF ADVOCATE GENERAL

KOKOTT

delivered on 14 October 2004 (1)

Joined Cases C-387/02, C-391/02 and C-403/02

Silvio Berlusconi and Others

(References for preliminary rulings from the Tribunale di Milano and the Corte di Appello di Lecce)

(Company law – First, Fourth and Seventh Directives – Annual accounts and consolidated accounts – Principle of public and accurate information – Appropriate penalties for false statements – Limits on the application of directives in criminal proceedings – Principle of the retroactive application of a more lenient criminal provision)

Table of contents

I – Introduction

II – Legislative framework

A – Community law

1. Overview

2. The relevant provisions of the First Directive

3. The relevant provisions of the Fourth Directive

4. Provisions of the Seventh Directive

B – National law

1. Previous legislation

2. New legislation

3. General provisions of criminal law

III – Facts, main proceedings and questions referred

A – General

B – Case C-387/02, Silvio Berlusconi

C – Case C-391/02 Sergio Adelchi

D – Case C-403/02 Marcello Dell’Utri and Others.

E – Procedure before the Court

IV – Legal assessment

A – Admissibility of the reference for a preliminary ruling

1. Description of the relevant facts

2. Description of the relevant legislation

3. Relevance to the decision

4. Interim conclusion

B – Substantive assessment of the questions referred

1. The scope ratione materiae of Article 6 of the First Directive

2. Appropriateness of penalties for the publication of false company documents

a) Effectiveness, proportionality and dissuasiveness of penalties

b) Tolerance limits

c) Limitation periods applicable to criminal prosecution

d) Graduated system of penalties and requirements in respect of criminal complaints

e) Combined effect of provisions of civil, criminal and administrative law

C – Effects on the criminal proceedings pending before the referring courts of an infringement of the directives by the national legislation

1. The obligation on national courts to give effect to the provisions of Community law

2. The limits on the application of directives in criminal proceedings.

a) Principles developed in case-law

b) Discussion of those principles in relation to this case

3. Retroactive application of a more lenient criminal provision

4. Interim conclusion

V – Conclusion

I – Introduction

1. Two Italian courts, the Tribunale di Milano (District Court, Milan) and the Corte di Appello di Lecce (Court of Appeal, Lecce) (hereinafter also called ‘the referring courts’) have pending before them a number of criminal cases in which the respective defendants are charged with having published false company documents (in Italian, false comunicazioni sociali), a practice usually referred to colloquially as ‘falsifying accounts’.

2. After the acts in question had been committed and the prosecutions relating to them had been initiated, the Italian legislature relaxed the relevant criminal provisions and made prosecution more difficult than under the previous legislation. Against the background of that legislative amendment, the referring courts wish, in essence, to ascertain the meaning of ‘appropriate penalties’ in relation to the publication of false company documents. They also ask whether, for the purposes of the relevant company law directives, the publication of false company documents is to be treated in the same way as their non-publication.

3. In the event that legislation such as the amendment to Italian law is regarded as being contrary to the relevant company law directives, it must also be clarified whether, in criminal proceedings, a more lenient subsequent criminal provision may, despite being contrary to Community law, be applied retroactively for the benefit of a defendant.

II – Legislative framework

A – Community law

1. Overview

4. Article 44(1) EC contains a legal basis for the adoption of directives to attain freedom of establishment. Under paragraph 2(g) of Article 44 EC, it is the duty of the Council and the Commission

‘[to] coordinat[e] to the necessary extent the safeguards which, for the protection of the interests of members and others are required by Member States of companies or firms within the meaning of the second paragraph of Article 48 with a view to making such safeguards equivalent throughout the Community’.

5. The Community has adopted several company law directives. Of particular relevance to this case are:

– First Council Directive 68/151/EEC of 9 March 1968 on coordination of safeguards which, for the protection of the interests of members and others, are required by Member States of companies within the meaning of the second paragraph of Article 58 of the Treaty, with a view to making such safeguards equivalent throughout the Community (2) (hereinafter, ‘the First Directive’ or ‘Directive 68/151’); and

– Fourth Council Directive 78/660/EEC of 25 July 1978 based on Article 54(3)(g) of the Treaty on the annual accounts of certain types of companies (3) (hereinafter, ‘the Fourth Directive’ or ‘Directive 78/660’),

which, in the case of Italy, are applicable to the following capital companies: società per azioni (public companies limited by shares, abbreviated to SpA), società in accomandita per azioni (partnerships limited by shares) and società a responsabilità limitata (private companies limited by shares, abbreviated to Srl). (4)

6. Regard must also be had to Seventh Council Directive 83/349/EEC of 13 June 1983 based on Article 54(3)(g) of the Treaty on consolidated accounts (5) (hereinafter, ‘the Seventh Directive’ or ‘Directive 83/349’). (6)

2. The relevant provisions of the First Directive

7. Article 2(1)(f) of the First Directive requires Member States to take the measures necessary to ensure that the compulsory disclosure of documents by companies extends at least to the balance sheet and the profit and loss account for each financial year. The provision also announces that, within two years of the adoption of the First Directive, the Council is to adopt a further directive to coordinate the contents of balance sheets and profit and loss accounts.

8. Article 3(1) to (3) of the First Directive provides as follows:

‘1. In each Member State a file shall be opened in a central register, commercial register or companies register, for each of the companies registered therein.

2. All documents and particulars which must be disclosed in pursuance of Article 2 shall be kept in the file or entered in the register; the subject matter of the entries in the register must in every case appear in the file.

3. A copy of the whole or any part of the documents or particulars referred to in Article 2 must be obtainable by application in writing at a price not exceeding the administrative cost thereof …’.

9. Under the first indent of Article 6 of the First Directive, Member States are to provide for ‘appropriate penalties in case of failure to disclose the balance sheet and profit and loss account as required by Article 2(1)(f)’.

3. The relevant provisions of the Fourth Directive

10. Article 2 of the Fourth Directive provides inter alia:

‘1. The annual accounts shall comprise the balance sheet, the profit and loss account and the notes on the accounts. These documents shall constitute a composite whole.

2. They shall be drawn up clearly and in accordance with the provisions of this Directive.

3. The annual accounts shall give a true and fair view of the company’s assets, liabilities, financial position and profit or loss.

4. Where the application of the provisions of this Directive would not be sufficient to give a true and fair view within the meaning of paragraph 3, additional information must be given.

5. Where in exceptional cases the application of a provision of this Directive is incompatible with the obligation laid down in paragraph 3, that provision must be departed from in order to give a true and fair view within the meaning of paragraph 3.’

11. The first subparagraph of Article 47(1) of the Fourth Directive provides as follows:

‘The annual accounts, duly approved, and the annual report, together with the opinion submitted by the person responsible for auditing the accounts, shall be published as laid down by the laws of each Member State in accordance with Article 3 of Directive 68/151/EEC.’

12. Article 47(1a) of the Fourth Directive (7) reads inter alia as follows:

‘The Member State [of the entity concerned] may exempt that entity from publishing its accounts in accordance with Article 3 of Directive 68/151/EEC, provided that those accounts are available to the public at its head office, where … .

Copies of the accounts must be obtainable upon request. The price of such a copy may not exceed its administrative cost. Appropriate sanctions must be provided for failure to comply with the publication obligation imposed in this paragraph.’

13. Under Article 51(1) of the Fourth Directive, companies are required to have their annual accounts audited by one or more persons approved to carry out audits of annual accounts under national law.

4. Provisions of the Seventh Directive

14. Article 16 of the Seventh Directive contains, in respect of the consolidated accounts of groups of undertakings, provisions which are in essence the same as those contained in Article 2 of the Fourth Directive; consolidated accounts must, in particular, give a true and fair view of the assets, liabilities, financial position and profit or loss of the undertakings included therein taken as a whole. Article 37 of the Seventh Directive corresponds to Article 51 of the Fourth Directive and provides for the compulsory auditing of consolidated accounts. Article 38(1) of the Seventh Directive makes the same reference to Article 3 of the First Directive in connection with the publication of consolidated accounts as the Fourth Directive...