7.  The applicant, Bimer S.A., is a company incorporated in the Republic of Moldova. From the moment of incorporation its shares were owned by Moldovan, American and Bahamian investors, it therefore qualified as a company owned by foreign investors and thus benefited from special incentives and guarantees under the Law on Foreign Investments (see paragraph 24 below). 8.  On 10 June 1994 Presidential Decree No. 195 (“the Decree”) was promulgated. It made possible the creation and operation of duty free shops at land, water and air-border crossings. According to the Decree, the duty free shops were entitled to sell imported goods without having to pay customs tax (see paragraph 23 below). 9.  On 12 June 1997 the applicant company signed a contract with the Leuşeni Customs Office, at the border between Moldova and Romania, providing for the opening of duty free shops on the territory of the customs zone. The contract did not contain any provisions as to its duration. It was approved by the Head of the Customs Department of the Government and by the Minister of National Security. 10.  On 3 July 1998 and on 2 December 1998 the company obtained two licences to operate a duty free shop and a duty free bar, within the shop, at the Leuşeni Customs Office. The licences were issued in accordance with the Decree and they did not contain any provisions as to their duration. Subsequently, the applicant company bought the necessary equipment, built the premises of the shop and bar and started operating them. 11.  On 24 April 2002 the Moldovan Parliament made an amendment to the Customs Code by which duty free sales outlets were thenceforward restricted to international airports and on board aircraft flying international routes (see paragraph 25 below). 12.  On 18 May 2002 the Customs Department ordered the closure of all duty free outlets which were not located in international airports or on board aircraft flying international routes (“the order”). 13.  On 12 June 2002 the applicant company, together with other companies similarly affected, lodged a court action against the order with the Court of Appeal of the Republic of Moldova. 14.  The applicant argued inter alia that the grounds relied on by the Customs Department in closing down its duty free shop and bar were not enumerated in the exhaustive list of grounds for closing down such shops provided for in section 56 of the Customs Code. 15.  Moreover, in the light of section 46 of Law No. 780 (see paragraph 26 below), the new amendments to the Customs Code could not have retroactive effect and could be interpreted only as limiting the opening of duty free shops in the future, and not as closing down those already open. 16.  According to the applicant, the order conflicted with section 40 of the Law on Foreign Investments (see paragraph 24 below), which stipulated that the activity of a company owned by foreign investors could be terminated only by a governmental decision or a court order, and only when the company had seriously breached Moldovan legislation and its articles of incorporation. 17.  The applicant further argued that according to section 43 of the Law on Foreign Investments (see paragraph 24 below), in the event of the adoption of new, less favourable legislation, companies owned by foreign investors were entitled to rely on the old legislation for a period of ten years. The ten-year period began to run from the date of enactment of the new legislation. Moreover, the second paragraph of the same section specifically provided that foreign-owned companies which enjoyed customs incentives in accordance with the former legislation of the Republic of Moldova had the right to enjoy those incentives after new legislation came into effect. 18.  On 26 June 2002 the Court of Appeal of the Republic of Moldova ruled in favour of the applicant company and quashed the order, relying inter alia on the following reasons:
“...The court considers that the order of the Customs Department No. 127 of 18 May 2002, issued for the purpose of applying Law No. 1022 of 25 April 2002 [concerning the modification of the Customs Code], by which the activity of duty free shops was terminated starting with 18 May 2002... is illegal because it is contrary to the legislation in force.
Law No. 1022 of 25 April 2002, by which Article 51 of the Customs Code was modified ... does not provide for the termination of the activity of the duty free shops already open in places other than airports and on board aeroplanes.
Moreover, the above mentioned Order [of the Customs Department] runs contrary to Article 56 of the Customs Code which does not provide among the reasons for liquidating a duty free shop the reason provided for in the Order – a change in the legislation.
The Court considers that the modified text of Article 51 of the Customs Code cannot have a bearing on the duty free shops already open and in operation, because this would also run contrary to Article 46 (1) of the Law on the Normative Acts, which stipulates that a law cannot be retroactive or ultra active.
Since the applicants are enterprises with foreign investments, the Court considers that the Order runs contrary to Article 39 (1) of the Law on Foreign Investments, which provides that the foreign investments are guaranteed full security and protection in the Republic of Moldova.
Moreover, according to Article 40 of the Law on Foreign Investment, the applicants' activity ...can be terminated only by means of a Government Decision or a court judgment and only if they have seriously breached the legislation or their statute of incorporation. However, the Order in question does not contain any reference to any breaches committed by the applicant and is not based on a Government Decision or a court judgment.
It is necessary to indicate that in accordance with Article 43 (1) of the Law on Foreign Investment, in case of enactment of new laws which change the conditions of a company with foreign investment created before the enactment of such laws, the company in question has the right to guide itself by the old legislation for a period of 10 years calculated from the date of enactment of the new legislation.
According to the second paragraph of section 43 of the Law on Foreign Investments, foreign investors and enterprises with foreign capital which enjoyed customs, tax and other incentives in accordance with the legislation of the Republic of Moldova formerly in force, have the right to enjoy these incentives after the new legislation comes into effect.
...
The court considers that the Order violated the applicants' right to property guaranteed by Article 46 of the Constitution, Sections 1, 40 and 41 of the Law on Property and by Article 1 of Protocol No. 1 to the Convention.” 19.  The Customs Department appealed against this judgment to the Supreme Court of Justice. 20.  On 11 September 2002 the Supreme Court of Justice allowed the Customs Department's appeal, quashed the judgment of the Court of Appeal and dismissed the applicant's action. The grounds relied on by the Supreme Court were as follows:
“The first instance court, in finding for the applicants, reached conclusions which are based on a wrong interpretation of the law because the Order in question does not provide for a total termination of the activity of duty free shops but only for the termination of their activity in certain places.
Therefore the first instance court's conclusion that the Order had as effect the termination of the entire activity of the foreign investors who had opened these shops and that thus their right to total security and protection provided for by Article 31 of the Law on Foreign Investment was violated is incorrect.
Article 51 of the Customs Code, as modified by Law No. 1022 of 25 April 2002, defines the duty free as a customs regime which consists of sale of goods under customs supervision in especially dedicated places in international airports and onboard aeroplanes.
Accordingly, through this provision the legislators regulate and limit the places in which such shops can be located but they do not create any interdiction in so far as their activity is concerned. Therefore the arguments of the first instance court that the right to activity of the foreign investors has been violated, is devoid of legal support. The applicants are not prohibited to place their shops in the places provided for by law, i.e. in airports and onboard aeroplanes.
...
According to the documents of incorporation of these companies, they practice different kinds of activities, including the sale of goods in the Duty Free regime.
The conclusion of the first instance court that the Order violated the right to property guaranteed by the Constitution and the international law is incorrect because the companies in question have the right to open duty free shops in other places, as provided by Article 51 of the Customs Code. The activity of the companies is not totally stopped and nothing is taken away from them.
...
The first instance court's reference to Article 40 of the Law on Foreign Investment which says that the activity of a company with foreign investment can only be terminated by a Government Decision or a court judgment is wrong because the Order did not totally terminate the applicants' activity but only the sale of goods in the Duty Free regime. They can do other activities which are provided in their documents of incorporation.” 21.  The Supreme Court of Justice did not express any view on the applicant's argument or the ruling of the Court of Appeal concerning the applicability of the second paragraph of section 43 (2) of the Law on Foreign Investment to the case. Its judgment was final.