CEDH · CASELAW;DECISIONS;DECCOMMISSION;ENG — 11 décembre 1986

.sDD6737AE { font-size:11pt } .s211D6B00 { margin-top:0pt; margin-bottom:0pt; line-height:normal; widows:0; orphans:0; font-size:8.5pt } .sBB9EE52A { font-family:Arial }    AS TO THE ADMISSIBILITY OF   Application No. 11189/84 by S-S., I. AB and B.T. against SWEDEN             The European Commission of Human Rights sitting in private on 11 December 1986, the following members being present:                 MM. C. A. NØRGAARD, President                   G. SPERDUTI                   F. ERMACORA                   G. JÖRUNDSSON                   B. KIERNAN                   A. S. GÖZÜBÜYÜK                   J. C. SOYER                   H. G. SCHERMERS                   H. DANELIUS                   G. BATLINER               Mrs G. H. THUNE               Mr.   F. MARTINEZ                  Mr J. RAYMOND, Deputy Secretary to the Commission           Having regard to Article 25 of the Convention for the Protection of Human Rights and Fundamental Freedoms;           Having regard to the application introduced on 19 June 1984 by S-S. I. AB and B.T. against Sweden and registered on 8 October 1984 under file No. 11189/84;           Having regard to the report provided for in Rule 40 of the Rules of Procedure of the Commission;           Having deliberated;           Decides as follows:   THE FACTS           The facts of the case, as submitted by the applicants, may be summarised as follows:           The first applicant is a Swedish company with its headquarters in Stockholm.   The second applicant is a Swedish citizen, born in 1914.   He is a chief county surveyor and resides at Vänersborg.   He is a minority shareholder in five different companies and submits that he does not control any of these companies.   Before the Commission the applicants are represented by Mr.   Hasse W. Tullberg, a lawyer practising in Stockholm.           In 1975 the Swedish Trade Unions Confederation (LO) intiated a debate on the economic policy in Sweden.   The new element in the debate was a proposed introduction of so-called employee investment funds (löntagarfonder).   Through these funds the LO envisaged a change in the economic power balance by increasing the influence of the employees in industry and commerce by means of a transfer of the ownership of capital.           The debate culminated in 1983 with the introduction of new legislation consisting of two new laws and nine amendments to existing laws.   In their proposals the Swedish Government referred in particular to the international economic situation and stated inter alia:     "The policy of stability is thus today more complex than during the period of swift progress after the war - and it therefore also means that new methods to solve the problems are required.   The task is in short to combine an increasing profit with a just distribution, a stable price and cost development and a low unemployment rate.   ...   Since we now again face a situation where the profits of trade increase, this time due inter alia to the enormous increase in competitive power from the devaluation in 1982, it is of the utmost importance that the price and cost development in our country does not accelerate again so that the devaluation effects are destroyed leaving us in a new cost crisis with harmful effects on trade balance and employment.   To avoid such a development now as well as later it would be necessary to decide upon measures which counter the increase of profits leading to a further concentration of power and property in trade.   On the contrary it is the task to spread out the power and property so that more people participate in the increase of property.   Through this the conditions for lower increase in costs and bigger growth are created, while a just distribution is not set aside but on the contrary intensified.   Through this the conflict of the policy of stability is alleviated considerably and the pre-conditions created for a stable and employment-creating economical growth.   This is the decisive and basic motive for the Government to propose the employee investment funds.   It is also the motive which in various forms has been brought forward in the debate concerning the funds, in Sweden as well as in other places."           The structure of the system was based on a new law concerning a profit-sharing tax and a new law concerning the administration of the taxes through the Government pension fund system.   It may be summarised as follows:   Means of obtaining capital           The Profit-sharing Tax Act regulates the manner in which the funds are to be raised to satisfy the requirements of the employee investment funds for the capital needed.   The obligation to pay profit-sharing tax embraces Swedish limited liability companies, co-operative associations, savings banks and certain insurance companies.   Under Section 1, the tax accrues to the State and is transferred to the National Pension Insurance Fund.           The amount of tax corresponds to 20% of the "profit-sharing base".   This base is the real profit of the company, after a "deductible" amount has been allowed for.   The deductible amount is either 6% of the payroll of the company which is liable to pay tax or 500,000 Swedish crowns if the company so prefers.   By real profit is meant the nominal profit of the company for the fiscal year, after taking into account the effect of inflation on the assets and liabilities of the company (Section 2).           In addition to the profit-sharing tax, the employee investment funds shall be financed by an increase in the supplementary pension charge, which Swedish employers and the self-employed are bound to pay to the Government.           Briefly, the system of general (State) pension and its financing is built up as follows:           Swedish employees and the self-employed are covered by the 1962 General Insurance Act.   The insurance schemes consist of health insurance, basic pension and supplementary pension insurance. Normally, pensions are paid after the person concerned has reached 65 years of age.   The right to supplementary pension is based on the income from gainful employment.   The person entitled to pension collects a larger or lesser number of pension points in relation to his income, upon which the amount of the supplementary pension benefit is based.           The general (State) insurance scheme is financed through the levying of a number of charges under the Act on Social Security Charges which are paid by the employers and by the self-employed.   One of these charges is intended to finance supplementary pensions.   For 1984, it was levied at the rate of 10% of the employees' pay or of the income of the self-employed from his work.           From the Bill on employee investment funds it appears that 0.2-0.5% of the supplementary pension charge in the form of a special supplementary pension charge shall be paid to the boards of the employee investment funds.   The additional charge for 1984 of 0.2% is regulated in the Act on the Amendment to the Act on Percentage Rates for Levying Charges for Supplementary Pension Insurance.           The profit-sharing tax is expected to bring in receipts of 1.5-2 billion Swedish crowns per year until 1990 and the special supplementary pension charge is expected to bring in receipts in the region of 2-2.5 billion Swedish crowns annually.   The employee investment fund boards will thus have available an average sum of 4 billion Swedish crowns annually from 1984 to 1990 and a total of 28 billion Swedish crowns over the seven year period.   However, a limit on the transfer of funds to the boards has been stated.   This corresponds to an "investment capacity" of 2-2.5 billion Swedish crowns per year.   The administration of the capital           The second new law passed in 1983 which is of importance in the employee investment fund system is the Act on the Statutes of the National Pension Insurance Fund.   The capital received under the law on social security charges is managed by a government body, called the National Pension Insurance Fund (AP Fund).   Further, it shall also manage the capital that is collected from the new profit-sharing tax and the special supplementary pension charge which is intended to finance the acquisition of shares by the employee investment funds.           Before the creation of the employee investment fund system, the assets of the National Pension Insurance Fund were managed by four independent boards.   As a result of the new Statutes for the National Pension Insurance Fund five new fund boards, called "Employee Investment Fund Boards", were created.   Each of them has nine members appointed by the Swedish Government.   Five of the members shall represent the employee interest.   The five boards are to have regional links (northern, eastern, western, southern and central board).           As regards the management of the assets made available to the fund boards the following directives are laid down in the Statutes of the National Pension Insurance Fund:           "34.   The Fund Boards shall, within the limits of what benefits the supplementary pension insurance system and is compatible with general economic policy, and taking into account the functioning of the credit market, manage the assets entrusted to them by investing them on the capital market.   The object of their investments shall be to improve the supply of risk capital to the benefit of Swedish production and employment.           The assets shall be invested so that the demand for a good yield, a long-term approach and spread of risk is satisfied.           36.   An employee investment fund board may invest the assets that the board manages           1.   in the shares of Swedish limited liability companies           2.   in such convertible loan stock or loan stock to which options to subscribe to new shares are attached as has been issued by such limited liability companies as are intended in 1, and           3.   as risk capital in Swedish co-operative associations.           37.   Para. 2.   An employee investment fund board may not acquire so many of the shares registered on the stock exchange in a limited liability company that they amount to 8% or more of the total number of shares in the company or, if the shares have various different voting values, so that the voting rights attached to the shares amount to 8% or more of the total voting rights of the shares in the company."           The employee investment fund boards will primarily invest their assets through the stock market.   This will be done in the normal situation by purchasing shares through the Stockholm Stock Exchange. Each of the five fund boards may acquire a maximum number of shares in quoted companies as corresponds to voting rights of 8%.   The five boards can thus together obtain voting righs of 40% in a quoted limited liability company.   There is no similar limitation on the acquisition of shares in other companies.           As a result of acquiring shares in Swedish companies, the boards of the employee investment funds are entitled to exercise the voting rights of these shares at the members' meetings of the companies concerned and consequently influence to a greater or lesser extent the election of the Boards of Directors of the companies and the direction of the companies' affairs.           A limitation on the voting rights of the fund boards is found in Section 38 para. 1:          "An employee investment fund board shall, at the request of a local trade union organisation at a limited liability company in which the fund board has acquired shares or, if the company is the parent company of a group, at its Swedish subsidiaries, assign to the trade union organisation for a maximum period of one year at a time the right to vote for half the voting rights attached to the shares."           By local trade union organisation is meant such an association of employees as has the standing of a party in local negotiations with the employer.   The voting rights are transferred from the fund board by "assigning" to the trade union organisation for a maximum of one year at a time the voting rights of the shares that the board manages.           There is no obstacle preventing the board of an employee investment fund from voluntarily assigning voting rights for more than 50% of the shares.   However, the right of the local trade union organisation to exercise voting rights for the above-mentioned percentage of the shares is unconditional.           The boards of the employee investment funds shall in accordance with Section 28 in the statutes of the National Pension Insurance Fund annually transfer a certain income from the assets under administration to the three fund boards responsible for the disbursement of supplementary pensions.   This income corresponds to 3% of the current value of the assets that the boards managed at the end of the previous financial year.   The current value calculations are performed with the aid of changes in the consumer price index.   Briefly, the system means that the fund boards are to be responsible for paying a 3% real interest on managed assets mentioned above to the AP Fund system.   The Swedish Law Council (Lagrådet)           The proposal that the Swedish Government presented to parliament was under the Constitution submitted for scrutiny from a legal point of view by an institution called the Law Council.   This council is composed of three members from the country's supreme legal institutions, the Supreme Court and the Supreme Administrative Court. In the present case, two Supreme Administrative Court Judges and a Supreme Court Judge scrutinised the bill and gave their opinion on 3 November 1983.           Concerning the compatibility of the Government bill with the Swedish Constitution and the European Convention on Human Rights, the Law Council made the following statement:   "In some statements of opinion it has been questioned whether the proposal is compatible with the Constitution and whether it is in accordance with Swedish international commitments.   On the latter point, it is probably the convention that Sweden supported through the ratification of the First Protocol of March 20, 1952 to the Convention concerning the Protection of Human Rights and Fundamental Freedoms that is referred to.   According to Article 1 in the Protocol all rights of physical or juridical persons to their own property shall remain inviolate and nobody may have their property confiscated except in the national interest and under conditions laid down in the law and the general principles of public law.   The bodies which have received the proposal for their opinion and which have taken up the question of the compatibility of the present proposal with the Constitution have not gone into the question in more detail.   What they appear to be wishing to question is whether our legal system allows assets to be taken from specific companies to be used by organs dominated by employees in the collective employee interest.   The Law Council for its part has the following comment to make.   The assets are taken from business firms by government taxes in the manner prescribed in the Constitution, viz. in accordance with laws; the supplementary pension charges should also be regarded as taxes.   The taxes are specially destined for the National Pension Insurance Fund.   The Constitution contains no rules concerning limitations on the purposes for which government taxes may be levied.   The use of government funds is decided by Parliament and the principal rule is that this shall be done by budgetary means.   However, Chapter 9, Section 2 in the Constitution allows the use of government funds for special purposes apart from through the budget.   Giving government revenues special destination is admittedly being brought to an end and parliament has stated that no new special destinations should be introduced.   There is nevertheless no constitutional obstacle to giving taxes a special destination.   Nor is there anything to prevent government funds being made available to bodies in which a specific group of citizens has a guaranteed dominating influence.   In the view of the Law Council no complaint can be made against the proposed employee investment fund system on the grounds of incompatibility with the Constitution.   Similarly, the Law Council finds that the proposal is not in conflict with our international commitments.   The requirement in Article 1 of the above-mentioned supplementary protocol that such interference as is intended in the Article must be based on the "public interest" can be regarded as being satisfied in that the assets will accrue to the National Pension Insurance Fund and be managed by bodies subject to public law.   The fact that the proposal also has other purposes such as strengthening the influence of employees over the business sector would not appear to lead to any other conclusion."           Summary           In summary, the complex of laws in connection with the parliamentary approval of the government bill includes the following points:           - A large number of Swedish companies will have to share a certain amount of their profits with the State by means of a special tax called the profit-sharing tax.           - All business enterprises which are compelled to contribute to the State for supplementary pensions under the law on social security charges will be affected, regardless of their earnings via the additional surcharge.           - The receipts from the above charges are destined for the acquisition on the open market of shares in Swedish limited liability companies.           - The owner of these shares will be the National Pension Insurance Fund, which is a government organ.           - Five of the nine fund boards, the Employee Investment Fund Boards, are assigned to manage the above-mentioned shares and through their use of the voting rights attached to these shares at annual general meetings to exercise influence on decisions regarding the affairs of the companies concerned.           - The majority of the members of the employee investment fund boards (five out of nine) shall represent the employee interests.           - The local trade union organisations at the companies in which shares have been acquired can claim to exercise voting rights for half the votes attached to the shares.   The trade union organisations will not themselves be the owners of the share capital of the companies, but they may exercise the functions of ownership (voting rights) attached to the shares that the fund boards acquire. The right of ownership will be retained by the State (AP Funds).           Finally, it appears that the Swedish Government as a motive saw the employees investment funds as one element in their economic policy.   Action appeared necessary to enable employees to participate in the earnings of business enterprises in order to improve the stability of long-term economic policy and to lower unemployment.   COMPLAINTS           Both applicants complain that Sweden has violated the European Convention on Human Rights and Protocol No. 1 to the Convention by virtue of the introduction in 1983 of the employee investment funds. Both applicants maintain that the law obliges companies in Sweden to make payments to the State, payments that almost exclusively are to be used to purchase company shares, which will then be at the disposal of trade union interests.   The result of the law is that trade union interests are assured the ownership of shares in Swedish companies in a way that deprives companies of assets, which are then used to support in an arbitrary fashion trade union demands for power and right of decision in Swedish limited companies.   This, the applicants allege, constitutes a deprivation of property in contravention of Article 1 of Protocol No. 1 to the Convention.           The law also contravenes the conditions for a State's use of power, set out in Articles 17 and 18 of the Convention.   Nor does Swedish law allow any effective remedy before Swedish courts or other authorities with regard to questions relating to the rules of the Convention, the absence of which is in contravention of Article 6 and Article 13 of the Convention.           Finally, the second applicant complains that, regarding the relationship between shareholders, the trade unions will benefit at the expense of the others in a way that violates the principle of equality between shareholders in a limited company to an extent that contravenes the principle of equality in Article 14 of the Convention.           The following is a summary of the submissions of the applicants in support of their allegations.           The aim of the employee investment funds is to cause a change of ownership within existing companies by means of legislation using money which arises from special public taxation.   This collectivisation of private ownership will be a continuous task for the boards of the funds.   The execution of their task takes place without any balancing of interests according to law or any other legal control by a public body regarding, for example, the purpose or need for this transfer from private to collective ownership.   In these respects the Swedish system differs on practically all points from the normal practice in Western Europe regarding nationalisation.   The entire design is alien to the legal traditions of Western Europe.           The funds work as autonomous socialisation instruments - formally speaking by taking decisions regarding voluntary purchases on the stock market from individual shareholders - but thereby using financial resources, acquired for the purpose by compulsory acquisition from companies.   It must be considered inadmissible to create an autonomous socialisation instrument outside of the State's direct control regarding questions of budget decisions and without any law concerning the principles of the transfer of ownership from individuals to trade union bodies.           Contrary to international practice about payment from public funds in cases of nationalisation, the Swedish system forces companies to pay for their own socialisation.   Impositions which in this way are aimed at financing transactions on the stock market, which interfere with the market conditions, affecting firms and private individuals, and which directly are aimed at changing the ownership configuration, are not such as to which fulfil any of the normal purposes of taxation.   It is not within the realm of normal public activity to organise stock-broking activities using the proceeds of impositions on companies; activities which are intended to be used for the ousting or out-manoeuvring of the current private owners.   The aim is incompatible with a reasonable general interest, something which, according to the Convention, is necessary for taxation measures.           The violation of the Convention consists in the transfer of profits from firms to a governmental institution which then forwards them to trade-union-run funds, which use the money to purchase shares and thereby acquire ownership of the firms.   In fact, this transfer of ownership takes place not as claimed for the benefit of the pension schemes   but to secure for trade unions the rights to vote and to exert influence over individual firms.           According to the Convention neither expropriation nor taxation is to be used to satisfy anything but the public interest. It cannot be regarded as satisfying a reasonable public interest to provide trade unions with a right of decision to acquire shares with money which is taken from enterprises by means of law and then to give trade union representatives that right of decision which is an integral part of share ownership.   On the contrary, it involves favouring group interests which do not form sufficient grounds from the public interest point of view to exercise public power in such a way as to acquire private possessions via taxation with the aim of changing the existing ownership configuration in limited companies. In order to describe this acquisition as taxation, the State is in fact in an artificial way brought into acting formally as a "middle-man" and money manager before the financial resources are free to be used for the purchase of shares by the trade-union-steered funds.   This is to obscure the fact that the financial resources derive from firms which the trade unions wish to purchase.           In principle an individual's possessions are to enjoy protection against public interference in such a way that the execution of public power can be controlled.   Article 1 of the First Protocol contains three distinctive rules.   In its first paragraph it states the principle of the fundamental right to peaceful enjoyment of possessions.   Secondly, the Article gives the State the power to interfere with the protection of possessions by such means as expropriation, that is acquiring property for public use, in ways described by law and in accordance with international law. Thirdly, the second paragaraph of Article 1 gives the State an extensive right to regulate the use of property in the way it considers necessary for the public benefit and in order to secure payment of taxes and other contributions for the same purpose.           The law concerning employee investment funds allows the transfer of possessions in ways which either lack the support of any constitutionally acceptable form of taxation right or constitute such abuse of constitutionally acceptable instruments of taxation that the right of property is violated.   Such a violation of the right of possession is in contravention of the fundamental right of peaceful enjoyment of possessions according to the Convention.           Protocol No. 1 constitutes a State's right to regulate the right of property by means of legislation.   However, there is a certain control of the State's legislative power, for example that the power must not be used in contravention of Article 17 of the Convention.   The said Article states that a State must not act in such a way that a human right as given in the Convention is lost or limited more than necessary.   Article 18 of the Convention forbids abuse of public power in such a way that human rights as defined by the Convention are limited for reasons not allowed by the Convention.           The power to impose tax is used for the purpose of causing a change in the power structure within enterprises, a purpose for which it is not intended.   The payments from the companies for the financing of the employee investment funds are not necessary to meet any public requirements for pensions.   The special designation to purchase shares is of no reasonable public interest but is in excess of what can be considered reasonable regarding interference in established relations of ownership within the companies.           As a matter of fact the employee investment fund system has been created for other purposes than the one officially given, that is to say for pension purposes.   The purpose is to satisfy trade union demands for the right to use shares and thus the right of decision within Swedish companies.           The collection of money in question is therefore such an abuse of the taxation system that it is in contravention of Articles 17 and 18 of the Convention.           The employee investment funds finally represent a system where trade union interests are decisive for the purchase of shares in companies.   The principle, however, that a transfer of possessions to the public is to be performed in accordance with law and can be brought before a court according to Articles 6 or 13 of the Convention does not apply in the Swedish system and accordingly these articles are also violated.           There is no constitutional court in Sweden but the Constitution gives a formal right to Swedish courts and authorities to test whether an Act in a particular case contravenes the Swedish Constitution.           Chapter 2, section 18 of the Swedish Constitution (Regeringsformen) gives the individual a right of compensation in case of expropriation or similar measures.   If an Act is in contravention of this requirement, a court can for example examine the question of compensation.   The legality of tax measures can also be tried by tax courts.           However, the test of constitutional viability is generally regarded more as a formal than a practically feasible right in cases of constitutional deficiencies in Swedish law.   Nor has there ever been any test of constitutional viability leading to the disapproval of a Swedish law.           Instead Swedish Acts are examined by a committee called the Legal Council (Lagrådet) before the passing of a bill.   The Legal Council is formally an advisory body to the Government.   It has examined the Employee Investment Fund Acts and found that they do not contravene the rules of expropriation found in the Constitution, Chapter 2, section 18 or the European Convention on Human Rights.           The Legal Council, however, is not a court and cannot decide on its own working conditions, such as the time allowed for the examination of a bill.   In this instance, the Government gave the Council only three weeks to examine the proposed legislation.   The Council was, furthermore, not commissioned to examine all Acts forming part of the legislation.   The members therefore complained over the short time and the incomplete material given to them.   The conditions under which the Legal Council was forced to work must be regarded as almost a parody of judicial work.   The Council's control was later also publicly criticised by the opposition in Parliament.           However, the findings of the Legal Council normally exercise great influence on the Swedish courts.   Therefore, the Council's acceptance reduces the already very small possibilities of being successful in Sweden with a test case regarding the unconstitutionality of the employee investment funds according to Swedish law.           According to Article 13 of the Convention every individual has the right to bring his case before a national authority in case his rights according to the Convention have been violated.   According to the practice of the European Court of Human Rights this also applies to anybody who maintains that such a violation has taken place.   In Sweden - which has not incorporated the rights of the Convention into her domestic law and where the courts refuse to take the rules of the Convention into consideration - there are no effective remedies within the meaning of the Convention regarding decisions taken by the Government or the Parliament.           In the case of Sporrong and Lönnroth v.   Sweden (Comm.   Report 8.10.80) the Commission found that Swedish legislation violated Article 13 of the Convention as regards decisions taken by the Swedish Government as the primary and ultimate decision-making body.   According to the Swedish system there is no possibility of having a case examined on the basis of the Convention.   The applicants feel that this is a case of violation of Article 13 and possibly also of Article 6 para. 1.           The second applicant has finally separately submitted the following regarding the effect of the interference on the companies' owners/shareholders.           Primarily, it is the companies themselves that are subject to the public interference since they must abstain from resources which are then used for the purchase of shares in the interest of trade union bodies.   Ultimately, however, the interference affects the owners of the companies.   Thus, both the companies as legal entities and their owners, that is the physical persons who own the shares, are affected.           The law on the employee investment funds will create a new group of company owners, who finance their ownership of shares by acquisition of the companies' own assets.   Thus, the purchase by the new group of owners takes place without any corresponding sacrifice of their own assets.   The change of ownership does not take place under commercial conditions by means of purchasing new issues of shares or purchasing shares on the stock market by using money which does not come from the companies themselves.   Other groups of shareholders will be overpowered by institutions which are not subjected to the commercial market condition whereby economic sacrifices must be made in order to purchase shares and to gain ownership in the companies.           Changes in the regulation of the relationship between different groups or types of shares, stated in the articles of companies, can, according to Swedish law, only be carried out voluntarily and, principally, by means of decision by a qualified majority at a general meeting of shareholders.   This method of acquiring shares which is, in principle, cost-free for the new group of owners, will endanger the existing relationship between different groups of owners, a relationship voluntarily created and regulated in the articles of companies.   Other owner groups, which separately or together own two or three per cent of the shares, may thereby have secured for themselves a decisive influence in company affairs through representation on the board or even involvement in management. Such an owner or group of owners is now in danger of losing influence because of the employee investment funds which - with means provided by the companies themselves - are able to purchase say five or six per cent of a company's total stock of shares.           The involvement of a previously influential group of shareholders will then become considerably changed, perhaps even meaningless from their own point of view.   It will no longer be possible to retain control of the company, something which is perhaps necessary if the original shareholders are to retain their involvement.   A block of shares that gives the owner influence represents a value as such, a value that is endangered or lost by the operations of the employee investment funds - operations which had been completely impossible to carry out without legislative support provided by the funds' statutes, and which authorise the funds to acquire compulsorily assets from the firms in the way described above.   The money used for the funds' purchase of shares is, in principle, money acquired from the shareholders.   The change of ownership is thus carried out at the expense of other shareholders.           The profit and profit-sharing taxes and the social security contribution, amounting to 0.2 per cent of wages/salaries and specially designated for the purchase of shares, all reduce companies' assets.   The assets acquired are then out of the companies' reach. This reduction of the companies' assets of course affects the value of the shares.   By the transfer of assets, in fact belonging to the companies, for purposes alien to the companies and without the support of any decision taken by the shareholders in a voluntary way stipulated in the charters of the companies, both the companies and their shareholders are sustaining losses.   These losses are directly linked to the enrichment of the employee investment funds.   This enrichment is in contravention of the protection of property afforded by the Convention as it forbids compulsory transfer of property without compensation.           In order to satisfy the trade union demand for part-ownership of companies it has been necessary to alter the ordinary rules for and the meaning of shareholding.   The Swedish Company Act, Chapter 1, section 1 has been amended to allow the transfer of voting rights to trade unions.   To abandon the Company Act's so-called "principle of indivisability" regarding share votes is by itself an expropriative measure as it is a direct transfer of powers of ownership to trade unions.           Thus it is clear that, as mentioned above, the employee investment funds in reality are administrative bodies taking care of trade union interests and not of national public interest.   The funds' organisation and administration are in practical terms alien to, or at least not necessary for the interests and needs of the State Pension Scheme.           As the funds choose companies as objects of purchase and begin to infiltrate them, the boards of the funds appear as intruders among the other shareholders.   In fact, the funds obtain assets from companies to the detriment of the other shareholders.           As mentioned before this endangers the configuration of ownership in the companies.   It also sets aside the principle of equality among shareholders, as the funds obtain company assets to enable them to purchase the companies' shares on the stock market.           Such a measure is to be considered an interference with the concerned companies' sphere of assets, an interference of an expropriative nature.   As mentioned "the principle of equality" is violated and the relationship within groups of shareholders is endangered by the introduction of a new group of shareholders who have been given assets from the companies to enable them to finance their purchases of shares.   Further, the principle of indivisability is surrendered when the right to vote, one of the prerogatives following ownership, is transferred to the trade unions.   This way of favouring a new group of owners and certain individual/trade union group interests also contravenes the principle of equality stated in Article 14 of the Convention.   THE LAW   1.       Both applicants have complained that the introduction in 1983 of the legislation in Sweden concerning the employee investment funds involves a breach of Article 1 of Protocol No. 1 (P1-1) to the Convention which reads:           "Every natural or legal person is entitled to the         peaceful enjoyment of his possessions.   No one         shall be deprived of his possessions except in         the public interest and subject to the conditions         provided for by law and by the general principles of         international law.           The preceding provisions shall not, however, in any         way impair the right of a State to enforce such         laws as it deems necessary to control the use of         property in accordance with the general interest         or to secure the payment of taxes or other         contributions or penalties."           It is clear from Article 25 para. 1 (Art. 25-1) of the Convention that the   Commission can receive an application from a person, non-governmental organisation or group of individuals only if such person, non-governmental organisation or group of individuals can claim to be a victim of a violation by one of the High Contracting Parties of the rights set forth in the Convention. Moreover, the Commission is competent to examine the compatibility of domestic legislation with the Convention only with respect to its application in a concrete case, while it is not competent to examine in abstracto its compatibility with the Convention.      Accordingly the Commission will only examine the applicants' complaints insofar as the legislation in question affects the applicants themselves.      Both applicants have alleged that the levying of a profit-sharing tax upon certain companies and the obligation of these companies to pay an increase in the supplementary pension charge are an interference with property rights which, therefore, can only be justified insofar as the interference is legally justified in accordance with the exception rules in the second sentence of the first paragraph or the second paragraph of Article 1 of Protocol No. 1 (P1-1) to the Convention.           Regarding this complaint the Commission observes that the "possessions" referred to are the sum of money the first applicant must pay under the Profit-sharing Tax Act and the supplementary pension scheme.   The Commission finds that this applicant, therefore, may claim to be a victim of an alleged violation of Article 1 of Protocol No. 1 (P1-1) to the Convention.   The Commission furthermore finds that this could be regarded as an interference with the first applicant's right to peaceful enjoyment of its possessions and that, therefore, Article 1 of Protocol No. 1 (P1-1) is applicable regarding this applicant.           Regarding the second applicant the Commission recalls that he is a shareholder in certain companies liable to pay the charges in question.           The Court of Human Rights has held that the term "victim" in Article 25 (Art. 25) of the Convention denotes the person directly affected by the act or omission which is at issue (cf. Eur. Court H.R., Eckle judgment of 15 July 1982, Series A No. 51, p. 30, para. 66).   The Commission has previously held in two cases that a shareholder was entitled to claim to be a victim of measures directed against a company (No. 1706/62, Dec. 4.10.66, Collection 21 p. 26 and No. 7598/76 Kaplan v. United Kingdom, Comm. Report 17.7.80, D.R. 21 p. 5   (p. 23)).           However, the Commission recalls that in both these cases the individual concerned held a substantial majority shareholding in the company.   In effect both applicants were carrying out their own business through the medium of the company and both applicants had a direct personal interest in the subject-matter of the complaint.   Thus in Application No. 1706/62 the applicant alleged that the actions of which he complained were part of a general scheme aimed against him personally.   The Kaplan case concerned restrictions imposed on the company on the basis of the applicant's alleged personal unfitness to act as a controller.           In the case of Yarrow and others (No. 9266/81, Dec. 28.1.83, D.R. 30 p. 155 (p. 185)) the Commission held that the applicants, who did not hold a majority or controlling interest in the company in question, were not directly and personally affected by the measure taken (the nationalisation of the company) even though this measure undoubtedly reduced the value of their shareholdings and they could not therefore claim to be victims within the meaning of Article 25 (Art. 25) of the Convention.   Moreover, it was open to the direct victim - the company - to lodge an application.           The circumstances of the particular complaint in this case are, in the Commission's view, comparable to the latter decision.   The second applicant himself is not required to pay any tax or additional charge to the national pension scheme and he cannot therefore be found to be directly and personally affected by these charges which are the subject of the first complaint to be considered by the Commission. Thus he is in this respect not entitled to claim to be a victim for the purposes of Article 25 (Art. 25) of the Convention and it follows that this part of the application, so far as brought by the second applicant, is manifestly ill-founded and must therefore be considered inadmissible under Article 27 para. 2 (Art. 27-2) of the Convention.           Regarding this particular complaint it thus remains to examine whether the interference with the first applicant's rights was justified.           The Commission has previously been called upon to determine whether another applicant company in Sweden had been subject to an unjustified interference when forced to pay the charges in question under the Swedish Employee Investment Fund Acts (Dec. No. 11036/84, 2.12.85, to be published in D.R.).   In this decision the Commission stated:   "The sums of money to be paid relate either to a profit-sharing tax or to a contribution to the Swedish pension system and the interference therefore falls under the notion 'to secure the payment of taxes or other contributions' as set out in the second paragraph of Article 1 (Art. 1-2). &