3/2000 Sb.



FIND



The Constitutional Court



On behalf of the Czech Republic



The Constitutional Court decided on 1 May 2004. December 1999 in the plenary on the proposal of the Group

members of the repeal of the law No 144/1999 Coll., amending Act No.

42/1992 Coll., on the adjustment of property relations and settlement of property

entitlements in cooperatives, in wording of later regulations, and Act No. 586/1992

Coll., on income taxes, as amended, and Act No.

569/1991 Coll., on the Czech Republic Fund Plots, as amended

regulations,



as follows:



The provisions of section 13 (3). 4, 5, 6, 7, 8, 9 and 10, section 13a to 13 c and section 18, paragraph.

4 of law No. 42/1992 Coll., on the adjustment of property relations and the settlement of

property entitlements in cooperatives, as amended, section 4

paragraph. 1 (a). ZD), section 24, paragraph. 2 (a). Zi), § 34 paragraph. 3 (b). (f)) and section 40

paragraph. 25 of the Act No. 586/1992 Coll., on income taxes, as amended

the provisions of section 2 (2). 5 (7) of the Act No. 569/1991 Coll., on Plots

Fund of the Czech Republic, as amended, and article. (IV) Law No.

144/1999 shall be repealed on the date of publication of this finding in the collection of laws.



In the rest of the proposal is rejected.



Justification



19 July. July 1999 was the Constitutional Court delivered a draft group

members pursuant to § 64 paragraph. 1 (a). (b)) of the Act No. 182/1993 Coll., on the constitutional

of the Court. The judge-rapporteur has found that the submission complies with the formal requirements of

proposal to repeal of the law with the petitem, to the Constitutional Court finding decided

that law No 144/1999 Coll., amending Act No. 42/1992 Coll., on the adjustment of

property relations and settling property entitlements in cooperatives, in

as amended, Act No. 586/1992 Coll., on income tax, in the

as amended, and Act No. 569/1991 Coll., on Plots of the Fund

The Czech Republic, as amended by later regulations, promulgated in the collection of

laws (the amount of 51) on 15. in July 1999, is repealed on the day of its publication

the award.



Members of the Chamber of deputies of the Parliament of the Czech Republic in the number 77

They confirmed their signatures presented by the proposal to repeal the law and mandated

members Mark, Bend to act before the Constitutional Court.



A group of members of Parliament points out the inconsistency of the contested act, with the following

constitutional articles:



article. 1 of the Charter of fundamental rights and freedoms,



article. 2 (2). 3 of the Charter of fundamental rights and freedoms,



article. 4 (4). 3 and 4, of the Charter of fundamental rights and freedoms,



article. 11. 1 and 4, of the Charter of fundamental rights and freedoms,



article. 1 (1). 1 of the additional protocol to the European Convention for the protection of

human rights and fundamental freedoms.



The promoters will focus on legislation dealing with the property of the members of the

cooperatives in its transformation, because according to them in this area

There has been a fundamental intervention in the constitutional rights of the citizens, or members of the

of the cooperative. For this purpose, in particular the provisions of § vie 13 (3). 2 and

3 of the law No 42/1992 Coll., on the adjustment of property relations and the settlement of

property entitlements in cooperatives, as amended, that

established entitlements of eligible persons with claims, as established by

Amendment of this Act issued under Act No. 144/1999 Sb.



section 13 (3). 2 of law No 42/1992 States:



If the person does not become a participant in the legal person referred to in

the transformation of the project and is an entrepreneur in the field of the subject activities

the production or consumer cooperatives or agricultural production operates in

the case of agricultural cooperatives, securities must be issued to share 90

days from the date when the person entitled to issue in writing.



section 13 (3). 3 of the same law provides:



If the person does not become a participant in the legal person referred to in

the transformation of the project and not an entrepreneur within the meaning of paragraph 2, the

be issued in the full amount of the shareholding after seven years from the approval

the transformation project, if the authorized person after approval

the transformation of the project agrees with the cooperative or its legal

the successor otherwise.



By contrast, according to the newly amended provisions of section 13 (3). 4 to 10

the contested act-the amendment introduced a new way of "settlement"

holding the release property sheets of the cooperative or its

legal successor. The person whose claim has not been to 31. March

1999 satisfied, will receive on settlement of your claim in cash 10%

nevypořádaného holding, but not more than the amount of 10 000 CZK

the resources of the Land Fund of the Czech Republic (hereinafter referred to as "Land

the Fund "), if your claim properly apply until 31 December 2006. March 2000. If so requested by

the person entitled to the settlement of the ownership interest since Landed

the Fund is a cooperative or its legal successor, obliged to conclude a

the agreement on the settlement in this way. The bond has a maturity of 20 years

with an interest rate of 2% per year. In the absence of this procedure to the settlement,

for example. Therefore, that the person on claim settlement on the issue of

holding did, since it is the cooperative or its legal

required to make the release of the successor to the settlement of property sheets in total

nominal value denominated in the name of the authorized person. By passing the

property sheets that meet specified requirements is the claim

the persons concerned against the team or his assignee settled.

If the first person released property sheets

cooperatives, for 15 years nezcizí or inserts into the property of the cooperative, or

other capital companies, land fund these property sheets

the repurchased after 15 years from the time of their release for a nominal price, without

the remuneration.



The promoters after this confrontation, conclude that the purpose of

the contested act is a change in the way the settlement of shares and

limits of their owners in a way that is not comparable with the

owns the rights of the owners of požívacími and other securities (shares,

bonds, notes, etc.) and, moreover, does not provide equivalent compensation

ensuring their rights. On the other hand completely disproportionately favors

borrowers, i.e.. mandatory people (and their successors)

taking without compensation since the transformation of the cooperative ownership

shares of the authorised persons. Consider, therefore, that a change in

How to issue shares to authorised persons, i.e.. their

the owners, enshrined in the contested Act restricts the rights of the owners

-institutional manner, in particular with regard to the constitutionally impermissible restrictions

the owner of the holding on the transformed cooperative or its

the legal successor, and violate the Treaty. 1 of the Charter of fundamental rights and

freedoms.



Another objection to the plaintiffs is that the contested act was created

the standard, which has a character of genuine retroactivity. Claims settlement

shares of the beneficiaries in section 13 (3). 3 to 10 of the Act arose

already under the terms of Act No. 42/1992 Coll., i.e.. When the transformation

cooperatives, thus for a long time before the effect of the contested act. The original section

13 (3). 3 based on the original method of release holding

However, he lost any sense next to the newly introduced method of settlement.

He became obsoletním, and evidence of the effectiveness of the back along with the article. (IV)

the contested Law, which provides that it is also

shares on the settlement of the claim before the date of its

efficiency. Retroaktivita follows from the fact that according to the original version, as

It is listed in the citation section 13 (3). 2 and 3 of law No. 42/1992 Coll., the owner of the

could choose between one of two ways: either the issue of holding that the

become a member of the cooperative, will operate the agricultural production, and thus gets

the right to the issue of the holding shall, without delay, or that agricultural

the production run and gets the right to release your property

share after the expiry of seven years from the approval of the transformation project. From

It follows that if decided for the second option, the legislature in

the contested Law his claim as a way to issue securities

share, fundamentally changed, and that in its detriment. This was according to the opinion of the

the petitioners violated article. 2 (2). 3 of the Charter of fundamental rights and freedoms.



The appellants expressed further doubts to the requirements and the legal

the nature of the property sheets, as defined in the contested act.

Meet the characters of the Charter defined in section 4, paragraph 4. 4 Act No 591/1992 Coll.,

the Securities Act, as amended, as they have to be

issued in connection with the acceptance of the obligations of the securities settlement

the share of beneficiaries on the transformed cooperative is associated with them

the right to the payment of the securities share and are transferable. In such a

the case, however, must also contain the particulars referred to in § 3 of the law No.

530/1990 Coll. on bonds, i.e., inter alia, the obligation of the issuer to repay the

the nominal value of the bond at a specified date, pay the specified yield

the bond within a specified period or the method of determining such income.

This will create the institutions, rules and situations that are inconsistent with the

the commercial code and related regulations valid in the area of

private law.



In the next part of his submission of the appellants based on the fact that the beneficiary

the person became the owner of the holding already before its release in the

the meaning of section 9 (2). 7 of law No 42/1992 Coll., i.e.. then, what was the securities
the share of the cooperative are calculated, and the person was familiar with him.

They point out that the contested law to substantial reduction of content occurs

the ownership of this property, and on limiting the rights of this asset

enjoy, and for a period of 15 years of deprivation of rights to enjoy its fruits and

benefits. The indirect result is then restriction of the rights to such

the asset. The appellants consider that the legislature is to protect

debtor-or transformed cooperatives legal successor-himself

outside the scope of the article. 11. 2 and 4 of the Charter of fundamental rights and

freedoms, since those entities "donated" the right to enjoy without compensation after the

for at least 15 years of foreign assets, while the owners of this property

failed the right to adequate income from this property.

While already under the original version of the law No 42/1992 Coll. provided

the legislature transformed a seven-year time limit for the issue of cooperatives

shares authorized persons (although without income) and the current

legislation from those who did not live up to their commitments of a substantial part

arising from the original version of the transformation Act, virtually

extended their advantage by twice. Of the appellants

are of the opinion that this was violated as the article. 11. 1 and 4, of the Charter of

fundamental rights and freedoms, article. 1 (1). 1 of the additional protocol to the

the European Convention for the protection of human rights and fundamental freedoms.



In conclusion, the appellants point out that according to the article. 1 of the Constitution of the Czech

Republic is the Czech Republic legal State and its definition characters

also include the principle of legal certainty and the protection of citizens ' confidence in the law and of the

It follows the ban on retroactive laws. Retroaktivita

provided for in article. (IV) the contested act is therefore a violation of acquired rights

beyond the purpose of Act No. 42/1992 Coll. and upsetting the principle of protection of

confidence in the law, and is thus in breach of article. 1 of the Constitution of the Czech Republic.



The Constitutional Court's constitutional complaint requested the observations of the

the Chamber of Deputies and the Senate of the Parliament of the Czech Republic.



By letter of 15 December 1997. September 1999 told the Chamber of Deputies Chairman prof.

Ing. Václav Klaus, CSc. The Constitutional Court, that law No 144/1999 Sb.

approved by the necessary majority of the members of the Chamber of Deputies on 1 May 2004. April

1999. June 28. April 1999 was rejected by the Senate, 19 November. in May 1999 he was

again approved by the Chamber of Deputies. President of the Republic was returned

day 2. June 1999 and 29 June. in June 1999, the Chamber of Deputies for its

the vote on the returned the law remained. After the law was signed by the

the Chairman of the Chamber of Deputies and the Prime Minister and has been duly declared.

As regards the content of the law, the President of the Chamber of Deputies

States that the reason to amend this law is the fear of the possible

the serious consequences of the mass settlement of the shares of the transformation

expected at the turn of the years 1999 and 2000. Today it is quite clear that agricultural

the cooperative or their legal successors in the position of debtors are not

and to set the time or they will not be able to transform the shares deal.

The aim of the amendment is, therefore, the protection of these entities before the bankruptcy. When

discussion of the Bill in the Chamber of deputies have been applied

fundamental and opposing views significantly, with the arguments of the opponents

the draft law was essentially identical to the examination of the proposal by a group of members of Parliament

The Constitutional Court. In conclusion, the President of the Chamber of Deputies stated that it is on

The Constitutional Court, in the context of the examination of the proposal to assess the constitutionality of

This law and issued the appropriate decision.



By letter of 30 June. September 1999 the Commission sent the Constitutional Court comments on the proposal

Group members chair the Senate. Libuše Benešová.

The Commission noted that the draft of the contested act has been the subject of comprehensive

debates in the Senate and in the course of discussing the draft were admittedly

shortcomings inherent in particular conflict between the original concept of the Bill,

which regulate the issue of holding, while the provisions of the amendment

the Act replaced by the semantically distinct word Edition of the word settlement; in

the situation where there is no between lender and agricultural cooperative agreement on

the settlement of the holding and, where it is proposed to address the status of the release

the property sheets in the value of the vypořádávaného property, and where the securities

the proportion is settled by the day on which the cooperative ownership issue sheets; on this day

It also extinguishes the claim beneficiaries against the agricultural cooperative.

The real interest, therefore, by reason of the mere absence of agreement

participants amended only on the property sheet that share of the real estate

It does not present; It is therefore the fact that the



-property sheet is issued by agreement of the parties;



-the law carries the obligation to pay a significant part of the obligations of the borrowers on

Land Fund and siphoning off public funds for other

purposes;



-the General provisions of the Act apply to all types of cooperatives and the present

the Bill deals only with agricultural cooperatives;



-Amendment of the damaging yet outstanding private farmers, which should

the property issue the cooperative or its legal successor is already 6 years ago, and

prefers required the persons which allows you to issue the property sheets, and then

to get rid of all the commitments, in particular the group prefers the compulsory

persons that have voluntarily did not fulfil the obligation to settle its obligations

against a group of persons to which the compulsory, so already done etc.



Have been made and the fear that the proposed edit does conflict with the

article. 11 of the Charter of fundamental rights and freedoms (deprivation of ownership rights without

the existence of public interest).



The present draft has been criticized for even retroaktivita, because it modifies the

dealing with property sheets at a time when the regime of the law already takes 7

years to the detriment of the pending cases.



As a result, the Senate rejected by 28 June. April 1999 in a vote

which of the 65 senators present and senátorek boat 39 for

the rejection and 21 against the zmítnutí of the draft law. It is therefore now on the basis of the

proposal submitted by the Group of MPs on the Constitutional Court to assess the constitutionality of

of this law.



The Constitutional Court is also acquainted with the content of the paper from the President of the Republic

day 2. in June 1999, which was the law according to the article. 50 of the Constitution of the Czech Republic

returned to the Chamber of Deputies. In a recital stating that the persons concerned,

in accordance with the valid legislation, since 1992, assumed that they

After 7 years from the approval of the transformation project of the cooperative will be issued

their interest in full. Just before the end of this rather

long time when their share was "blocked", should be the certification system

shares in full settlement of claims, the regime replaced that substantially

exacerbated by their economic status. The law in this way violates the

one of the basic principles of the rule of law, the principle of trust in the

law, and, in effect, weakening the Constitution of the Czech Republic guaranteed

protection of property rights. The adopted law deepens inequality between

different groups of beneficiaries, established in 1992,

specifically, between persons, which began to engage in agricultural production (those

interest had to be issued within 90 days of the filing of the application), and between the

the people who started agricultural production run.



The Constitutional Court also requested the opinion of the Government, which in this case

presented Prime Minister Ing. Milos Zeman of the day 2. December 1998

The Chamber of deputies of the Parliament of the Czech Republic. It states that the

the Government agreed with the proposal of the law, but at the same time drew attention to the

that, in the near future he will discuss their own extensive amendment to the

Act No. 42/1992 Coll., which will be proposed and the solution method

the settlement shares in cooperatives. The Government also pointed out

that presented the Bill has some shortcomings, such as:



-of the proposed provisions is not always clearly evident, what nature would

have the property list in the sense that he has to go on the bond or security

paper shares, type



-the proposal (article 13, paragraph 5), so that the same way it is proposed

deal equity shareholdings of non-members of cooperatives, were settled and

holdings of members of cooperatives do not correspond with the actual status,

Since the settlement of the shares of members of cooperatives usually fixes

the statutes of cooperatives,



-also raises doubts as to the proposal (section 13a (3)), that the property sheet

He was publicly tradable directly from the Act, IE. without the permission of

the relevant State authority, which could lead to the fact that the capital

the market should get more problematic and illiquid securities, as well as

the proposal (article. (II)) on the scope of the tax exemption,



-standard, which is designed (article. (III) to expand the rights of the Land Fund),

is excessively General,



-the Bill lacks the explanatory memorandum, including the quantification of economic

and the financial reach of the proposed adjustments.



The Constitutional Court reviewed the proposal for the repeal of law No 144/1999 Coll. and came

concluded that the proposal is reasonable. While violations of the constitutional

the provisions reviewed in some cases from design differently.



From the constant case law of the Constitutional Court, although it follows that it is for the State,

to decide that one group will provide less benefits than the other, but may not

proceed arbitrarily, and his decision must be that they do so in the
the public interest, and not for example. Therefore, to conceal the shortcomings in the management of

Public Affairs.



The Constitutional Court as the constitutionality of the first protection authority decided that the

It will not deal with the justification of the proposal, concerning the objection that the contested

the law has introduced the new institutes, for example. property sheets, and even some

other provisions got into conflict with the commercial code or

related provisions. It does not have to be told that the objections are not

legitimate, but the Constitutional Court went to the presented proposal in particular

in terms of whether it has been violated constitutional standards which

in its proposal, the plaintiffs said.



After review of the submitted supporting documents, including the Parliamentary papers and with

taking into account the reasons which have been applied by the President

the Republic and Senate of the Parliament of the Czech Republic, the Constitutional Court decided to

the conclusion that the amendment violates the transformation Act, one of the basic

the principles of the rule of law, and the principle of legal certainty and confidence in law,

as is apparent from the article. 1 of the Constitution of the Czech Republic. Beneficiaries, in accordance

with the law, since 1992, they assumed that after 7 years from the

approval of the transformation project will be released their interest in the

full. Just before the end of this rather long period, however, the amendment

brought a completely different solution, and this settlement (not release)

holding either widened due to 20 years with interest rate of 2% or

the property sheet that a compulsory purchase for a nominal value of Land

the Fund after 15 years without remuneration from the first person who was

securities list of the cooperative. The amendment, therefore, on the one hand, damages,

deteriorating economic situation and denies the rights of ownership of the legitimate

the property shares, and on the other side of the law legalizes the cooperatives

or foreign trade companies dispose of the property in accordance with their

custom layouts. It is also a violation of article. 11. 1 and 4, of the Charter of

fundamental rights and freedoms, the right of ownership of all owners has the same

legal content protection. Whether or not the forced restriction of ownership rights is possible

only in the public interest, on the basis of the law, and for compensation.



Its scope and concepts of the amendment and deepens the inequality between the

different groups of beneficiaries, which was already established in the

in 1992, and between persons, which began to operate the farm

production and which had to be holding issued within 90 days from the submission of the

applications, and between persons who started agricultural production,

which could (not have to) be a share issued pursuant to section 13 (3). 3

Act No. 42/1992 Coll., this inequality, which could be from the restitution

looking perhaps regarded as justified, and hence for the legislation, which

reflect the public interest, but has been extended by an amendment in this

extent that it already cannot be considered as justified and must be evaluated

as a violation of the article. 1 of the Charter of fundamental rights and freedoms expressing

the principle that people are equal in rights.



In connection with the above statement you must agree with the fact that

the amendment had been violated and the article. 1 (1). 1 of the additional protocol to the European

Convention for the protection of human rights and fundamental freedoms, which provides that

any natural or legal person has the right to peacefully enjoy your

assets. No one can be deprived of his property except in the public

interest and under the conditions provided for by law and general principles of international

rights.



When considering all of the above reasons, the Constitutional Court ruled that it should be

the design of the group members meet and a new adaptation of Act No. 42/1992 Coll. and

Law No. 586/1992 Coll. and no 569/1991 Coll. repealed. After the formal page

He had to come out of it, that Act No. 144/1999 Coll., which was declared in

The collection of laws of the day 15. in July 1999, the same day changed the provisions in

the original law No 42/1992 Coll., where the provisions of the contested act

No 144/1999 Coll., which the Constitutional Court considered unconstitutional, this way

calls.



At the same time, the Constitutional Court considers it necessary to point out how the authorities

legislative, Executive, law No 42/1992 Coll. section 13 should in

paragraph. 3 consolidate the position of the beneficiaries, that is, it follows from the text,

but is zeslabováno to the extent that the issuance of securities

share, though, is laid down by law at the time when you want to pass binding

the seven-year period for this issue of the disputed and by law No 144/1999

Coll. was practically annulled. The Constitutional Court therefore left without

Noting the observations of some of the members of Parliament or even the senators who in design

Bill saw the withdrawal of ownership without the existence of a public

interest or as a form of expropriation, but not for the need to

a democratic State, but for another group of people that did not honor his

commitments, which since 1992 resulted from the Act. Agricultural

the cooperative then got the possibility to use the assets of the beneficiaries and the proceeds

from this property. Some acted honestly, economically and legally fulfilled

legal obligation and property shares. Was based on the fact that

the property was entrusted to the Administration, that is, and that it is necessary

return within a specified period. It was, however, even that of entrusted assets

nepečovala.



For these reasons, the Constitutional Court annulled the contested statutory provisions

under section 70, paragraph. 1 of law No. 182/1993 Coll., on the Constitutional Court.



As regards the part of the amendment, according to which, in section 13 (3). 2 and 3 of law No. 42/1992

SB. the words "published" and "release" has been replaced by the words "settlement" and

"settlement", the proposal on the abolition of the Constitutional Court rejected under section 70

paragraph. 2 Act No. 182/1993 Coll., as they came to the conclusion that this

legislation is unconstitutional, while constitutionally Conformal

the interpretation and application of legal standards violations

proprietary rights of authorised persons.



The President of the Constitutional Court:



JUDr. Kessler v. r.