CEDH · PRESS;ADMISSIBILITYDECISIONS;ENG — 15 septembre 2010

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France (application no. 50425/06)   CourT dEclares GEORGE SOROS’S complaint concerning his conviction for insider trading partly admissible     Unanimously: application partly admissible   –         complaint under Article 7 (no punishment without law) admissible, without prejudging the merits –         remainder of the application inadmissible (Articles 6 §§ 1, 2 and 3 (d), 13 and 14)       Principal facts   The applicant, Mr George Soros, is an American national who was born in 1930 and lives in New York. The case concerns his criminal conviction for insider trading on the stock market in 1988.   In September 1988 an investor invited Mr Soros to take part in an operation to buy up shares in the major French bank S., in a bid to take it over. After studying the offer, Mr Soros finally declined.   A few days later he had his company Q.F. – a major investment fund operating in the American, European and Asian markets – buy up 50 million dollars’ worth of shares in four recently privatised French companies, including bank S. Then, a few days after having acquired 160,000 shares in the bank on the London and Paris exchanges for the sum of 11.4 million dollars, Q.F. decided to sell some of them, making a profit of approximately 2.28 million dollars in the process.   In February 1989 the C.O.B. (the French stock-exchange watchdog) opened an investigation into trading in bank S. shares to determine whether there had been any insider trading. The C.O.B. concluded that it was impossible under the relevant legislation [1] for it to “draw a line with any certainty between what was legal and what was not”. Having identified other suspicious transactions, the C.O.B. reported them to the public prosecutor. In a letter dated 15 December 1989 Mr Soros answered the C.O.B.’s questions and endeavoured to justify his investment.   According to the applicant, it was subsequent to his case that the Regulation of 17 July 1990 on the use of inside information was adopted, in an attempt to identify the different categories of insiders and types of offences they might commit. Furthermore, an EU Directive was adopted on 13 November 1989 to clarify and harmonise the notions of “inside information” and “insider”.   The investigation opened in 1990 against Mr Soros, who was suspected, along with others, of insider trading using inside information to deal on the stock market, lasted ten years and was headed by four successive investigating judges. At his only hearing, on 30 June 1993, the applicant said that he could not remember exactly what information he had been given about bank S.’s shares for the takeover bid as it had all happened too long ago.   The Paris Tribunal de grande instance rejected the applicant’s submission that the proceedings against him were unlawful. His objection was based on the unforeseeability of the law on insider trading and the fact that he had had no business dealings with bank S. and did not, therefore, fall within the scope of the law in question. The court, on the other hand, held that it was sufficient for him, by his profession or in the course of his work, to have come into possession of inside information in order for him to be considered a secondary insider. The court also rejected a length-of-proceedings objection lodged by Mr Soros, considering that the duration of the investigation did not invalidate the proceedings.   On the merits, Mr Soros argued that the project concerning bank S. had been explained to him in broad terms and he had not been told that it was confidential, otherwise he would have refrained from investing in the share. The court considered, on the contrary, that the project had been “sufficiently precise to consider that the information disclosed was inside information”. The applicant was found guilty of insider trading and fined 2.2 million euros (EUR). That judgment was upheld on appeal. The fine was reduced to EUR 940,507 by a judgment of 20 March 2007, to take into account only those shares traded on the French stock market.     Complaints, procedure and composition of the Court   The applicant lodged several complaints under Article 6 (right to a fair trial within a reasonable time), about the unfairness of the proceedings, namely: the excessive length of the trial (and the lack of an effective remedy against it under Article 13); the lack of proper reasons for the decisions against him; the fact that his right to be presumed innocent had not been respected; and, that certain witnesses against him had never been questioned.   Relying on Article 14 (prohibition of discrimination), he also complained that he alone had been required to prove his innocence, while the other accused had been acquitted.   Relying on Article 7 (no punishment without law), the applicant alleged that the law applicable at the relevant time had been too unclear for him to realise that he was doing anything wrong. He also complained of the failure to apply European legal provisions to his case which were more favourable to him than the French law that was applied.   The application was lodged with the European Court of Human Rights on 13 December 2006.   The admissibility decision was given by a Chamber of seven judges, composed as follows:   Peer Lorenzen (Denmark), President , Renate Jaeger (Germany), Jean-Paul Costa (France), Rait Maruste (Estonia), Isabelle Berro-Lefèvre (Monaco), Mirjana Lazarova Trajkovska (the Former Yugoslav Republic of Macedonia), Ganna Yudkivska (Ukraine), judges , and also Claudia Westerdiek , Section registrar .     Decision of the Court   Article 6 § 1   Length of proceedings   Mr Soros alleged that the delay in the proceedings had affected his ability to recall facts that would have proved his innocence – he also relied on Article 13 (right to an effective remedy) in this connection. However, the applicant had known that he was under investigation because on 15 December 1989 he had given clear answers in writing to the questions put to him by the C.O.B. It was therefore reasonable to expect him to have gathered evidence in his defence in case judicial proceedings were brought against him. The Court further noted that at the time when the investigation had been opened, the action against the applicant was not time-barred.   In addition, Mr Soros had not been convicted solely because of his inability to answer certain questions clearly, as the courts had also taken his statements to the C.O.B. into consideration.   This complaint was therefore rejected as manifestly ill-founded.   Proof and reasons for decisions   In prosecuting and convicting the applicant, the investigating authorities and the domestic courts had based themselves on various items of evidence that had been discussed in adversarial proceedings and found to be sufficient. Detailed reasons had been given for the impugned decisions, which showed no signs of arbitrariness.   This part of the application was therefore dismissed as manifestly ill-founded.     Article 6 § 2 (right to be presumed innocent)   Mr Soros complained that the burden of proof had been shifted onto him and that he had not been given the benefit of the doubt. He alleged that he had been convicted without having been able, several years after the event, to prove his innocence. This complaint was therefore linked to the one concerning the unfairness of the proceedings because of their length (Article 6 § 1), which the Court had declared inadmissible, so it too was declared inadmissible.     Article 6 § 3 (d) (right to examine witnesses)   There was no indication in the case file that Mr Soros had requested the examination of witnesses, either by the investigating authorities or by the courts. The Court further noted that this complaint had not been brought before the Court of Cassation. This part of the application was therefore rejected for failure to exhaust domestic remedies.     Article 7   Foreseeability of the French law   Relying in particular on established case-law – four decisions in cases concerning insider trading – the French Government maintained that the impugned provisions had been sufficiently clear and precise for Mr Soros to have known whether or not what he was doing was legal. The applicant argued that the cases referred to were not relevant, as there had been no business relationship between him and the bank concerned.   The Government noted that the opinion of the C.O.B. was purely consultative and that the investigation the C.O.B. had carried out had been rapid and incomplete, unlike the judicial investigation, which had been much more thorough. They pointed out that the case had been handed over to the courts because the C.O.B. had suspected that a crime had been committed.   The applicant submitted that after proceedings had been brought against him the French authorities had commissioned a report on stock market ethics and had rapidly amended the legislation on insider trading to make it clearer.   The Court considered that this complaint raised complex issues of fact and law which could not be resolved at this stage in the examination of the application, but required examination on the merits. It accordingly declared the complaint admissible, without prejudging the merits.   Application of Community law   The applicant’s complaint as formulated before the Court concerned only the non-application to his case of the EU Directive of 1989. The Court would therefore confine its examination to that Directive. (The applicant had relied on the Directive of 2003 only before the domestic courts.)   Furthermore, the applicant’s complaint concerned only the domestic courts’ failure to take into account the first Article of the 1989 Directive – which allegedly defined the notion of inside information much more clearly than French law – and not its other provisions.   The Court considered that this complaint, thus formulated, was linked to the complaint concerning the unforeseeability of the French law regulating insider trading at the relevant time, also lodged under Article 7 of the Convention. It accordingly considered that it raised complex issues of fact and law which could not be resolved at this stage in the examination, and declared it admissible.   Article 14   The applicant relied on Article 14 in conjunction with Article 6 § 2. As the Court had already found the applicant’s complaint under Article 6 § 2 manifestly ill-founded, Article 14 did not apply.   As to the allegation of discrimination based on the fact that the applicant’s co-accused had been given the benefit of the doubt and acquitted, the Court noted that it did not appear from the case file that Mr Soros had been in the same situation as them, as the charges against them had been different.   This complaint was therefore also rejected as manifestly ill-founded.     ***   The decision is available only in French and can be found on the Court’s Internet site ( www.echr.coe.int ). This press release is a document produced by the Registry. It does not bind the Court.   Press contacts Emma Hellyer (telephone: +33 3 90 21 42 15) Tracey Turner-Tretz (telephone: + 33 3 88 41 35 30) Kristina Pencheva-Malinowski (telephone: + 33 3 88 41 35 70) Frédéric Dolt (telephone: + 33 3 90 21 53 39) Nina Salomon (telephone: + 33 3 90 21 49 79)   The European Court of Human Rights was set up in Strasbourg by the Council of Europe Member States in 1959 to deal with alleged violations of the 1950 European Convention on Human Rights.   [1] Section 10.1 of Order no. 67-833 of 28 September 1967 (version incorporated in the law of 22 January 1988, which was in force at the time), now Article L. 465-1 of the Monetary and Financial Code.