CASE OF TEBIETI MÜHAFIZE CEMIYYETI AND ISRAFILOV v. AZERBAIJAN
Violation of Art. 11;Pecuniary damage - claim dismissed;Non-pecuniary damage - award
Anatoly Kovler;Dean Spielmann;Elisabeth Steiner;Giorgio Malinverni;Khanlar Hajiyev;Sverre Erik Jebens
6. The Association is a non-profit-making non-governmental organisation (NGO), now dissolved, which was active between 1995 and 2002. The application was lodged by its former Chairman, Mr Sabir Israfilov, who was born in 1948 and lives in Baku. 7. The Association was registered by the Ministry of Justice on 25 August 1995 and acquired the status of a legal entity. 8. Clause 1.1 of the Association’s Charter defined it as an independent, charitable public organisation with voluntary membership, conducting its activities within the framework of the laws of the Republic of Azerbaijan on public associations, other applicable laws and its own Charter. 9. According to clause 1.2 of the Charter, the main objects of the Association were: “... in the circumstances of the present-day environmental crisis, to develop the environmental culture and awareness of the various strata of the country’s population, to organise a public movement for a clean environment in Azerbaijan, to give impetus to the process of effective resolution of environmental protection problems, and to strive permanently to promote the measures necessary to create a healthier environment.” 10. According to the Charter, the Association’s governing bodies consisted of the Congress (the general assembly of members), the Central Council (the management board elected by the general assembly for a fiveyear term), the Central Supervisory Commission (a body of internal control elected by the general assembly for a five-year term), and various local bodies. Clause 4.8 of the Charter provided that the Congress, as the general assembly of members, was the Association’s supreme governing body and would convene once every five years. 11. Since the date of its establishment and State registration, and until August 2002, the Association had not convened a general assembly of its members. 12. It appears that, on 9 July 1997, about two years after the Association’s State registration, the Ministry of Justice sent a letter to the Association, noting that the latter had committed certain breaches of the domestic law and the Association’s own Charter. The exact content of that letter is not clear from the materials available in the case file. 13. On 14 August 2002 the Ministry of Justice commenced an inspection of the Association’s activities. 14. On 10 September 2002 the Ministry issued a warning to the Association in accordance with section 31.2 of the Law on nongovernmental organisations (public associations and foundations) of 13 June 2000), applicable at the material time (“the NGO Act”). The Ministry stated that the Association’s activities did not comply with the requirements of its own Charter and the domestic law. It was noted that a general assembly of the Association’s members had not been convened within the five-year period specified in its own Charter. Moreover, in any event, this provision of the Charter was itself incompatible with the domestic law, as section 25.2 of the NGO Act required that the supreme governing body of a public association – the general assembly of members – was to be convened at least once every year. The Ministry requested that, within ten days, the Association take measures to remedy the above-mentioned breach and inform the Ministry of the measures taken. 15. In reply, Mr Israfilov informed the Ministry that, in fact, a general assembly of members had taken place on 26 August 2002. It appears that, among other things, the Association’s general assembly decided to establish a working group in order to bring the Association’s Charter into conformity with the current legislation. 16. Having examined the documents relating to the general assembly meeting of 26 August 2002, on 3 October 2002 the Ministry of Justice issued a new warning to the Association (which constituted a second warning issued in 2002). It noted that the general assembly of 26 August 2002 had been convened in violation of numerous provisions of the domestic law. The Ministry noted, inter alia, that not all members of the Association had been properly informed about the general assembly and thus had been unable to participate in it, and that the Association’s local branches had not been equally represented at the assembly. Generally, the current membership records had not been properly kept and it was impossible to determine the exact number and identity of members. Local branches of the Association had not held any regular local assemblies of members and, in fact, functioned as regional offices directly governed by the head office in an administrative and hierarchical manner, whereas in a genuine public association ordinary members should be able to directly participate in its management. The Ministry again demanded that, within ten days, information be submitted as to the steps taken to remedy these breaches. 17. It appears that the Association disagreed with the above findings in its correspondence with the Ministry and took no action in response to this second warning. 18. Finally, on 28 October 2002 the Ministry issued a third warning, stating that it had not received any information from the Association as to compliance with the prior two warnings. In addition to reiterating the remarks contained in the prior warnings, the Ministry noted that the Association also engaged in an activity prohibited by law. Specifically, the domestic law (namely, the NGO Act, the Law on environmental protection of 8 June 1999 and the Law on entrepreneurial activity of 15 December 1992) prohibited public associations from interfering with the activities of private businesses. In this connection, the Ministry noted: “However, contrary to these legal requirements, the Association ... attempts to collect money from State organs and commercial organisations in the guise of membership fees, regularly conducts [unlawful] inspections at economic enterprises and draws up [environmental compliance] reports, and engages in other illegal acts interfering with the rights of entrepreneurs ...” 19. As it had done previously, the Ministry demanded that, within ten days, the Association submit information as to the steps taken to remedy the situation. The Association did not react. 20. In December 2002 the Ministry lodged an action with the Yasamal District Court, seeking an order for dissolution of the Association. The Association, represented by Mr Israfilov, lodged a counterclaim, contending that the Ministry’s warnings had been unlawful and unsubstantiated. 21. On 7 March 2003 the Yasamal District Court dismissed the Association’s counterclaim and granted the Ministry’s request, ordering the Association’s dissolution. 22. Specifically, in respect of the Ministry’s request for dissolution, the court heard oral submissions by the Association’s members and the officials of the Ministry of Justice’s Department of State Registration of Legal Entities, reviewed the content of the Ministry’s three warning letters issued in 2002 and examined the correspondence between the Association and the Ministry. The court also examined six internal reports by various officials of the Ministry of Justice concerning the results of the inspection of the activities of the Association’s various local branches. According to these reports, most of the inspected branches had not held regular local assemblies of members and had not maintained proper records of members and membership fees. One of these reports stated that, according to “information obtained” during the inspection, the Association’s branch in the Tovuz region carried out illegal environmental inspections and engaged in other illegal activities. 23. Based on the above materials, the court found that, despite the early warning issued on 9 July 1997 (the content of which was not specified in the judgment), the Association had continued to commit breaches of domestic law on an even more systematic basis, which had led to the issuance by the Ministry of Justice of the three warning letters in 2002. The court noted that the Association’s Charter had not been brought into compliance with the domestic law on public associations, which required that a general assembly of members be held no less than once a year. In any event, even the five-year period for convening a general assembly, as required by the Association’s Charter, had not been complied with. The court further found that the Ministry’s findings concerning numerous irregularities during the general assembly meeting of 26 August 2002, as well as breaches of law in the general functioning of the Association, constituted a basis on which to dissolve the Association for systematic failure to comply with the domestic law. 24. Furthermore, again based on the above-mentioned oral testimonies of the Ministry officials and their inspection reports, the court noted that the Association had frequently overstepped the limits of the scope of its activities as defined in its Charter and permitted by law, by interfering with the competence of the relevant State authorities. In particular, it was noted that the Association’s local branches had attempted to carry out unlawful environmental inspections on the premises of various State and commercial enterprises and collect membership fees from them, issued reports on these enterprises’ compliance with environmental standards, and engaged in other actions interfering with the activities of commercial entities. The court found that, by engaging in such actions, the Association had violated the rights of other persons and attempted to misappropriate powers of a State regulating authority. 25. The court further noted that, in accordance with the NGO Act, the issuance of three warnings by the Ministry of Justice constituted a basis for an association’s dissolution if the latter did not take any measures to remedy the shortcomings in its activities. The court therefore ordered that the Association be dissolved. 26. The Association appealed, claiming that the provisions of the NGO Act were vague and imprecise, giving the Ministry a wide discretion to interfere with public associations’ activities and to issue warnings even for minor irregularities in their activities. The Association also argued that the Yasamal District Court’s factual findings concerning its activities had been incorrect and unsupported by any evidence. 27. On 4 July 2003 the Court of Appeal dismissed the appeal and upheld the Yasamal District Court’s judgment. 28. By a final decision of 29 October 2003, the Supreme Court upheld the lower courts’ judgments. 29. The Association’s State registration certificate was revoked and the Association was dissolved. 30. Article 59 of the Civil Code provides: “59.2. A legal entity may be dissolved: ... 59.2.3. By a court order, if the legal entity engages in activities without the required permit (licence) or in activities prohibited by law, or if it otherwise commits repeated or grave breaches of law, or if a public association or foundation systematically engages in activities that are contrary to the aims set out in its by-laws, as well as in other cases provided by law. 59.3. A request to dissolve the legal entity under the grounds specified in Article 59.2 of this Code may be lodged by the relevant State authority or local self-administration authority, to which the right to lodge such a request is granted by law. ...” 31. Section 1 of the NGO Act provides: “1.1. This Law regulates the relations concerning the establishment and functioning of public associations and foundations. 1.2. The definition of ‘non-governmental organisation’ in this Law includes public associations and foundations. 1.3. This Law determines the rules for the establishment, activity, reorganisation and dissolution of non-governmental organisations, as well as their functioning, management, and relations with government bodies. 1.4. This Law does not apply to political parties, trade unions, religious organisations, local self-administration authorities and non-governmental organisations which are regulated by other laws.” 32. Under section 2, a public association is defined as an NGO established on the initiative of several individuals and/or legal entities associated on the basis of common interests in pursuing the objectives set out in the association’s by-laws, which does not engage in profit-making as a primary aim of its activity and which does not distribute any profit between its members. 33. Chapter IV (sections 22-24) regulates issues related to the activities and property of NGOs. In particular, under section 22.1, an NGO may engage in any type of activity which is not prohibited by the laws of the Republic of Azerbaijan and which is not contrary to the aims of the organisation as set out in its charter. 34. Chapter V (sections 25-27) contains rules on the management of NGOs. Section 25.1 provides that the internal structure of a public association, the powers of its governing bodies, their formation procedure and term of office and the rules on decision-making and representing the association shall be regulated by the public association’s charter, subject to the conditions set out in the NGO Act and other relevant legal provisions. In particular, the supreme governing body of a public association is the general assembly of members, to be convened not less than once a year, upon the initiative of the associations’s executive body, one of its founders or one third of its members (sections 25.2-25.3). The general assembly decides upon, inter alia, the following issues: (1) adoption of and amendments to the association’s charter; (2) use of the association’s property; (3) election of the association’s other governing bodies and early termination of their office; and (4) approval of the annual report, among other publications (section 25.5). The founders and members of the public association must be informed of the date and place of the general assembly at least two weeks in advance. Amendments to the association’s charter may be made only if the quorum of more than half of the association members is present. Decisions are adopted by a majority of votes of the participating members. Each member has one vote (section 25.6). It is required to keep written minutes of the general assembly, which shall be signed by the assembly’s president and secretary and, if necessary, distributed to all members (section 25.7). 35. Section 31 provides: “31.1. A non-governmental organisation that breaches the requirements of this Law shall be liable in accordance with the laws of the Republic of Azerbaijan. 31.2. If a non-governmental organisation commits actions incompatible with the objectives of this Law, the relevant executive authority [the Ministry of Justice] may issue a written warning to the organisation and give an instruction to remedy such breaches. 31.3. A non-governmental organisation may judicially challenge such warning or instruction. 31.4. If a non-governmental organisation receives, within one year, more than two written warnings or instructions to remedy the breaches of law, such organisation may be dissolved pursuant to a court order.” 36. Section 4 of the Law on environmental protection of 8 June 1999 provides, inter alia, that the carrying out of environmental monitoring and audits is within the competence of the relevant State authorities. Sections 7 and 73 of the Law on environmental protection define the rights and obligations of NGOs in the field of environmental protection. The essence of the NGOs’ rights, within the meaning of these provisions, is the civic defence of environmental rights, encouraging public debate on environmental issues and alerting the relevant State regulatory authorities to any environmental hazard or breach of the applicable environmental standards. The range of NGOs’ rights in this field does not include a right to conduct formal environmental inspections or enforce relevant environmental norms or standards. 37. Likewise, section 7 of the Law on ecological safety of 8 June 1999 vests rights in NGOs, inter alia, to make proposals on ecological safety to the relevant State authorities and alert the latter to breaches of environmental laws. NGOs are not vested with a right to enforce environmental laws. 38. Section 5.2 of the Law on entrepreneurial activity of 15 December 1992 prohibits political parties and NGOs from interfering with entrepreneurial activities. 39. The following are extracts from Recommendation CM/Rec(2007)14 of the Committee of Ministers to member States on the legal status of nongovernmental organisations in Europe: “... 44. The legal personality of NGOs can only be terminated pursuant to the voluntary act of their members – or in the case of non-membership-based NGOs, its governing body – or in the event of bankruptcy, prolonged inactivity or serious misconduct. ... 46. The persons responsible for the management of membership-based NGOs should be elected or designated by the highest governing body or by an organ to which it has delegated this task. The management of non-membership-based NGOs should be appointed in accordance with their statutes. 47. NGOs should ensure that their management and decision-making bodies are in accordance with their statutes but they are otherwise free to determine the arrangements for pursuing their objectives. In particular, NGOs should not need any authorisation from a public authority in order to change their internal structure or rules. 48. The appointment, election or replacement of officers, and ... the admission or exclusion of members should be a matter for the NGOs concerned. ... ... 67. The activities of NGOs should be presumed lawful in the absence of contrary evidence. 68. NGOs can be required to submit their books, records and activities to inspection by a supervising agency where there has been a failure to comply with reporting requirements or where there are reasonable grounds to suspect that serious breaches of the law have occurred or are imminent. ... 70. No external intervention in the running of NGOs should take place unless a serious breach of the legal requirements applicable to NGOs has been established or is reasonably believed to be imminent. ... 72. In most instances, the appropriate sanction against NGOs for breach of the legal requirements applicable to them (including those concerning the acquisition of legal personality) should merely be the requirement to rectify their affairs and/or the imposition of an administrative, civil or criminal penalty on them and/or any individuals directly responsible. Penalties should be based on the law in force and observe the principle of proportionality. ... 74. The termination of an NGO ... should only be ordered by a court where there is compelling evidence that the grounds specified in paragraph 44 ... above have been met. Such an order should be subject to prompt appeal.” 40. A comparative study of the relevant legislation of 25 out of 47 member States of the Council of Europe shows that an NGO can be membership-based or non-membership-based and can take a variety of legal forms applicable in the domestic legal order, such as an association, foundation, trust, charity or even company. A key factor in determining the level of scrutiny and control that an NGO will be subjected to is whether the body concerned is legally incorporated and enjoys legal personality. Normally, unincorporated associations enjoy a much wider scope of selfmanagement and are not interfered with unless they conduct activities which are illegal or prejudicial to public order. Legally incorporated NGOs, on the other hand, are often subject to more narrowly delimited rules and may be dissolved or face other sanctions in the event of non-compliance. 41. It appears that in a number of States an NGO can, in certain circumstances, be dissolved either, specifically, for failure to conduct its internal management in accordance with the requirements of domestic law or, more generally, for failure to comply with its own charter. Countries within this category include: (i) Austria, where an association can be dissolved by a decision of a competent public authority if, inter alia, it exceeds its field of activity or if it no longer fulfils its own statutory rules; (ii) the Czech Republic, where foundations, endowment funds and public benefit corporations can be dissolved by a court for failure to comply with their charter or the domestic law (however, associations cannot be dissolved for failure to conduct their internal management); (iii) Finland, where a court may on the basis of an action brought by the relevant public authority or an association member dissolve an association if it acts substantially against the law or substantially against the purpose defined for it in its rules; (iv) Hungary, where the courts may declare the dissolution of a civil society organisation if it has failed to operate for at least one year, or the number of its members is permanently below the number determined by law; (v) Italy, where the competent governmental authorities may dissolve foundations in the event that they are not conducted in a lawful manner and in conformity with their by-laws; (vi) Luxembourg, where associations may be dissolved for failure to comply with the objectives which they have assumed, or if they have gravely contravened their constitutive statute or the law; and foundations can be dissolved if they are no longer able to pursue the object for which they were created; (vii) Malta, where a voluntary organisation may be struck off the register of voluntary organisations and/or issued with a suspension order potentially permanently suspending all or part of its activities, if the organisation in question is not complying with the provisions of its statute or the relevant domestic law; (viii) the Netherlands, where a regional court can dissolve an association or foundation, inter alia, if its statutes do not fulfil the requirements of the law or if it acts substantially contrary to its own Articles; (ix) Poland, where the courts can, in situations where associations are found to be acting contrary to the law or infringing the provisions of their own charter, order their dissolution; (x) Romania, where the relevant law provides that an association’s failure to convene its general assembly or board of directors for more than one year results in its de jure dissolution; (xi) Russia, where an association may be dissolved if it repeatedly and seriously violates the requirements of the applicable domestic law; (xii) Slovakia, where courts can decide to dissolve non-profit organisations, foundations, non-investment funds and associations for contraventions of the applicable domestic law as regards their internal management; and (xiii) Turkey, where the Civil Code provides that associations can be dissolved for, inter alia, failure to compose the internal bodies required by law, hold their first general assembly meetings within the time-limits prescribed by law or to hold subsequent general assembly meetings regularly. 42. In a number of other member States an NGO may not be subject to involuntary dissolution for failure to conduct its internal management in accordance with the requirements of the domestic law or its charter (although the authorities may dissolve an NGO, inter alia, if it engages in illegal activities or if its goals and acts violate the public order). Countries within this category include Bulgaria, the United Kingdom (England and Wales), Estonia, France, Germany, Ireland, Latvia, Portugal, Slovenia, Spain, Sweden and Ukraine. 43. As for the range of alternative sanctions (apart from involuntary dissolution) that may be imposed on NGOs for various types of contraventions, such sanctions include: (i) fines (Austria, Malta, Russia, Slovakia, Slovenia, Turkey and Ukraine); (ii) suspension of activities (Finland, Hungary, Malta, Russia, Slovakia, Turkey and Ukraine); (iii) the invalidity of a decision taken in contravention of the organisation’s internal charter or applicable domestic law (Estonia, Hungary, Italy, Latvia and Poland); (iv) the dismissal of administrators (Italy and, in respect of foundations, Luxembourg); and (v) being struck off a special register and withdrawal of associated privileges such as tax benefits (Bulgaria, England and Wales (loss of charitable status), Ireland, Portugal and Spain).