Strasbourg, June 30, 2011 The European Court of Human Rights handed down its decision in the affair

r of the taxation of donations received by the Association les Tmoins de Jhovah. It condemns France for violation of Article 9 of the Convention for the Protection of Human Rights and Fundamental Freedoms. Unanimously. It is the first time that France has been condemned by the ECHR for violation of freedom of religion.

The facts In the unavowed combat of religious groups described as sects, the national association of Jehovahs Witnesses was the object, in 1995, of a heavy financial audit (18 months), which did not highlight any irregularities or commercial practices. Therefore, so as not to leave empty-handed, falling back on an old administrative practice, the tax authorities decided that the manual gifts made by thousands of believers, scrupulously registered by the association and disclosed during its audit, thus became taxable at the rate of 60 % of the total amount concerning the years 1993 to 1996, an amount of nearly 23 million Euros. Unanimously criticized by the profession, this about-face in the interpretation of fiscal laws was nonetheless endorsed by the national courts, thus opening the way to a challenge before the European Court of Human Rights. At the same time, so as to calm the fears of other associations, faced with the threat of the vampirism of their resources, the legislator adopted, on August 1, 2003, a legal modification concerning gifts to associations and patronage. After setting aside, in its decision on admissibility, arguments relative to discrimination (the association involved was however one of the only religious associations targeted by such a tax), the European Court decided to concentrate its attention on the alleged violation of the plaintiffs freedom of religion which, if it had to pay the required amount plus penalties (almost 60 million Euros in total), would be prevented from functioning and could no longer ensure the coordination of the work of Jehovahs Witnesses in France.

Comments In its decision of June 30, 2011, the European Court held that the freedom of religion of Jehovahs Witnesses had been infringed, in particularly severe terms. It judged that the taxation of the donations of the faithful by the tax authorities, at a rate of 60 % over a period of 4 years (1993 to 1996) was unjustified and constituted a violation of Article 9 of the Convention, which guarantees freedom of thought, conscience and religion. It is a legal victory for Jehovahs Witnesses (JW), who have been denigrated and stigmatized since 1995, the date of the first parliamentary report on sects in France. In the case in point, the taxation in question threatened the perpetuity, or otherwise seriously limited the internal organization, the running of the association and its religious activities, given that places of worship themselves were targeted and given the impact of this measure on the resources of the applicant association and its capacity to carry out its religious activities as such, the Court concludes that there was interference in the exercise of the rights guaranteed by Article 9 of the Convention (53). Evidently, a 60 % tax on the donations of its faithful to a religious association, including penalties, which together exceed 50 million Euros, is indeed interference in the running of the association concerned, as well as its religious objectives. Once this interference is determined, the Court verifies whether it is included among that authorized by 2 of Article 9. In such cases, this verification usually involves three points: The interference must be prescribed by law, that is to say sufficiently clear and foreseeable so that individuals and groups may regulate their conduct accordingly.
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The interference must perform a legitimate purpose: public security, the protection of public order, health or morale and the protection of the rights of others.

The interference must be necessary in a democratic society, meaning that it must be proportionate to the goal pursued.

Traditionally, the Courts verification has concerned the necessity in a democratic society of interference that is prescribed by law in the pursuit of a legitimate purpose. It is quite rare for the Court to reveal a violation of the Convention from the outset of its verification,
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concerning the law which, in the sense of the Convention interpreted by the Court, refers to both legal and regulatory texts, and domestic jurisprudence. France had already been condemned for the unpredictability of the law concerning phonetapping in 1991. Once again, the Court did not need to verify all of the aspects of the case. The violation was evident from the first stage of the unpredictability of the law at the origin of the contested tax. It is a particularly stigmatizing acknowledgment of violation for a State to be reproached for the imprecision or exploitation of its internal standards with the assent of its courts since, before appealing to the European Court, it was necessary, because of the rule on exhausting internal means, to go through the judges of the first instance, appeal, and cassation. The decision is very severe on the attitude of the tax authorities, which exploited the financial audit carried out at the head office of Jehovahs Witnesses in France, although no fraud, irregularity or commercial aim had been identified. By making the General Tax Code say what it did not say, and that nobody had imagined in connection with voluntary gifts to non-profit associationswhat is more a religious one, in this casethe tax authorities seriously infringed the associations rights and threw the world of associations into disarray (without much reason, moreover, because this seems to be the only large association to have benefited from this twisted interpretation). Whether it concerned the notion of manual gifts and the identification of the giver, or the disclosure of the gifts, the Court judged that the association was not able to foresee to a reasonable degree the consequences that could result from the receipt of donations and the presentation of its accounts to the tax authorities (72). Therefore, at this stage the Court could conclude that there had been a violation of Article 9 of the Convention. And it is most unfortunate!! Indeed, we would have liked the Court to go further in its reasoning and to dismantle brick by brick the, to say the least vicious, cobbledup case of the tax authorities, whether it be in its doubtful legitimate aim (combating a socalled sect, to which the State Council attributed in 2000 the status of religious association, meaning that its exclusive purpose is the practice of worship and that it is not a threat to public order), or the necessity of the interference in a society that is democratic and therefore pluralist, or whether the motives were pertinent, sufficient and proportionate to the

goal pursued. Wager that both the legitimacy of the goal pursued and the necessity of the interference would have also been found lacking in the case. When it determines that there has been a violation of the Convention, the Court may, under Article 41 of the Convention, decide upon just satisfaction if domestic law only imperfectly allows the reparation of said violation. In this case, in a perfectly reasonable way, the Court reserved this issue, thus giving the parties time to meet and draw their own conclusions from the decision of the Court. Indeed, it should be pointed out that the States are committed to conform to the final decisions of the Court. Todays decision may still be deferred to the Great Chamber if the State requests it and if the Great Chamber accepts the request according to very strict criteria. Given the very severe and clear decision of the chamber, one might think that the State will not want to see this severe decision endorsed by the Great Chamber and will refrain from making an appeal. The separate opinion of Chairman Costa seems to signify that he would have liked the matter to be examined by the Great Chamber, as it raises serious questions. But no doubt, given his vote in favor of violation, these serious questions, if they were put through the mill of the Conventions requirements (in particular the legitimate goal, and proportionality) would only increase the evidence of a major violation of the Convention by a stubborn administration. What is also serious is the passiveness of the national courts, which had opportunity to mend this violation themselves. That way, the dirty laundry could have been more discreetly washed in the family!! This was not the case. In any case, as things stand, the only possible application of the decision is the annulment of the incriminated tax demand and the lifting of the guarantee mortgages on the seized properties. The State cannot demand the amounts involved in this violation of the Convention, that is to say the totality of the tax and penalties, and must reimburse those that were seized at the time of the financial audit. The State must do all it can to satisfy its obligation of restitutio in integrum so as to efface all the consequences of its violation of the freedom of religion of the plaintiff. Discussions between the parties must only concern the annexed requests of the association, in particular concerning moral prejudice. Philippe GONI Lawyer at the Paris Bar
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