EHRM, 25-07-2013, nr. 13772/05, nr. 11082/06

In 2002–2003 Yukos began to pursue a number of ambitious business projects which would make it one of the strongest players on the market and independent of the State. In particular, Yukos challenged the official Russian petroleum policy of tacit alignment with the OPEC policy of reducing oil production. Yukos sought instead to maximise its oil production and market share. Further, from 2003 Yukos was in the process of merging with Sibneft, another large Russian oil company. The merger was supposed to take place in two steps: firstly, completion of the deal on paper, and then unification of the new company's management structures. The first aspect of the deal was finalised in October 2003; the second was supposed to be implemented by January 2004. Yukos was also engaged in merger talks with the US-based Exxon Mobil and Chevron Texaco companies. According to the applicants, Chevron Texaco was considering the purchase of 25 per cent of Yukos shares, while Exxon Mobil planned to buy at least 40 per cent of the future Yukos Sibneft company.

Yukos was also planning to build a liquid gas pipeline to the Arctic Ocean in order to export natural gas to the western part of Europe without passing through the State-controlled pipelines. Similar plans existed in respect of China; here the applicants advocated building an oil pipeline along an alternative route to that favoured by the Presidential Administration.

Finally, Yukos and the State-owned company Rosneft were involved in a public struggle for control over certain oil fields. Yukos was successfully competing with Gazprom, another State-owned company, on the natural gas market.

In 2000 Mr Putin was elected President of the Russian Federation. One of the points of his political programme was to ‘liquidate the oligarchs as a class’. Furthermore, President Putin advocated, according to the applicants, the renationalisation of the oil and mining industries, which had been privatised by his predecessor in the mid-90s.

In 2001 the first applicant founded a non-profit NGO, the ‘Open Russia Foundation’. Its annual budget in 2003 amounted to approximately USD 200 million. This NGO cooperated with other Russian human rights NGOs, such as Memorial, the Moscow Helsinki Group, etc., and was involved in a number of humanitarian and educational projects across the country.

From at least 2002 the first applicant openly funded opposition political parties, namely Yabloko and the SPS (Union of Right Forces). He also made certain public declarations criticising anti-democratic trends in Russian internal politics. A number of his close friends and business partners became politicians. Thus, Mr Dubov and Mr Yermolin were members of the Duma (the lower chamber of the Russian parliament); Mr Shakhnovskiy, Mr Nevzlin, Mr Guryev and Mr Bychkov were all at various times members of the upper chamber, the Federation Council.

The first applicant asserted that his political and business activities had been perceived by the leadership of the country as a breach of loyalty and a threat to national economic security. As a counter-measure the authorities undertook a massive attack on the applicant, his company, colleagues and friends.

On 6 April 2004 the Meshchanskiy District Court decided that the second applicant should remain in detention pending trial. No reasons were given for that decision. On 15 April 2004 the District Court dismissed the application for release lodged by the defence. The court held as follows:

The District Court concluded that the second applicant should be kept in custody pending trial.

On 19 August 2004 the second applicant's lawyers lodged an application for release on behalf of the second applicant, referring, in particular, to his poor health. The District Court refused to release him, on the basis that the second applicant could receive adequate medical aid in the remand prison. The court also held that the second applicant's continuous detention was justified in view of the gravity of crimes imputed to him, and ‘information about [the second applicant's] character’. The District Court also noted that the persons with whose assistance the second applicant had allegedly committed the offences still worked in the companies and depended on him.

At the hearing of 10 September 2004 the prosecutor requested the court to extend the second applicant's detention on remand until 26 December 2004, since the previous detention order would expire on 26 September 2004. After that the defence declared that they needed to study the request and asked for a one-hour adjournment. The court gave the adjournment sought. An hour later the second applicant asked for one hour more to prepare a reasoned reply to the detention request. Again, the court granted that motion. At the end of the period the defence lodged a written reply to the prosecutor's motion. The defence objected but the court granted the request and extended the second applicant's detention on remand as requested. The reasons given by the District Court in its decision of 10 September repeated the reasons stated in the decision of 15 April 2004.

The defence appealed. According to the Government, the brief of appeal against the extension order of 10 September 2004 was submitted on 20 September 2004. On 13 October 2004 the Moscow City Court upheld the decision of the lower court. The City Court noted that ‘the circumstances in which the imputed acts had been committed’ suggested that, if released, the second applicant might pervert the course of justice by putting pressure on witnesses or otherwise influencing them, or might abscond, and that the City Court ‘had not discovered any reason to repeal the [lower] court's decision as requested by the brief of appeal’.

At the hearing of 14 December 2004 the prosecutor again requested an extension of the second applicant's detention until 26 March 2005. That request was made orally. The defence was given two hours to prepare written submissions. The defence produced written arguments, following which the court granted the request and extended the detention until 26 March 2005, giving the same arguments as in the detention orders of 15 April and 10 September 2004.

The appeal against the detention order of 14 December 2004 was lodged on 24 December 2004 and examined on 19 January 2005 when the Moscow City Court upheld it.

At the hearing of 2 March 2005 the State prosecutor requested a new extension of the second applicant's detention pending trial. The prosecutor referred to the second applicant's oral statement of 1 March 2005, when he had said that he ‘would haunt the prosecutor until his last day’. In reply to the request the defence did not ask for additional time to prepare their arguments. The second applicant explained, in particular, that there had been nothing new in the prosecution's requests for detention since 2003, and that he was prepared to give his arguments immediately. The court heard the defence and granted the request extending the second applicant's detention until 26 June 2005. That detention order repeated the reasons given in the previous detention orders.

The detention order of 2 March 2005 was appealed against on 11 March 2005; the first hearing was scheduled for 23 March, but the defence sought an adjournment in order to obtain a Ruling by the Constitutional Court of 22 March 2005 (no. 4-P). The appeal was therefore examined and dismissed on 31 March 2005.

The second applicant claimed that in the remand prison IZ-77/1 where he had been detained from 21 October 2003 until his transferral to the correctional colony on 27 September 2005, he had been deprived of all physical exercise. Thus, he constantly missed his daily walks because of the need to read the materials in the case file or participate in the hearings. On weekends and holidays, when there were no court hearings he could not go outside because he was ill. Further, the food in the prison was incompatible with his illnesses, and he only received appropriate food from his relatives or lawyers to a limited extent. It was impossible to have a hot meal at midday when there was a hearing or when he was reading the case file. During the Christmas holidays the second applicant was transferred to an overcrowded ‘common’ cell. Despite his requests, he was not given a calculator or a magnifying glass. As a result, he was able neither to prepare for the hearings nor to have a rest.

The second applicant complained to the prison doctors about his health problems. On 2 March 2004 he was examined by a panel of doctors composed of the Chief Physician of the Moscow Health Department, Deputy Medical Director of the Moscow Prisons Department, Healthcare Director of the remand prison, and an infectiologist. The panel described his state of health as follows:

On 18 August 2005 the second applicant was placed in a solitary confinement cell (or ‘isolation cell’) as a punishment, allegedly for refusing to go outside for a daily walk. The documents produced by the Government also indicated that the applicant had refused to go to the shower rooms, whereas, according to the applicant, the remand prison did not have a bath-house for inmates. According to the applicant, the cell was very small and had no natural light or ventilation. He did not receive hot meals. It was prohibited to lie or even sit on the bed between 6 a.m. and 10 p.m. The bed was very close to the toilet pan. The water for flushing, drinking and washing was available from the water-tap above the toilet pan. The second applicant spent seven days in that cell.

The Government described the conditions in the isolation cell as follows. The cell in which the second applicant was placed measured 5.52 square metres, which was more than the minimal surface area established by law. The second applicant was detained in the cell alone. The cell had a folding bed, a washbasin with cold water, a toilet, a shelf for toiletries, a chair and a table. The cell was ventilated naturally, and was lit by a day-time lamp and a night-time lamp (dezhurnoye osvescheniye). In addition, the cell had a window measuring 60 × 90 cm. The cell was equipped with a cistern for boiled water which was supplied by the warders when necessary. Referring to the certificates issued by the head of the remand prison, Mr Tagiyev, dated 7 August 2008, the Government alleged that illumination, temperature and humidity in the isolation cell had corresponded to the sanitary standards. The distance between the toilet and the bed was one metre, which was explained by the small dimensions of the cell; such a distance, however, respected basic requirements of hygiene. The bed was unfolded during the night, namely between 11 p.m. and 6 a.m. During the daytime the second applicant could sit on the chair. The Government also attached a report of inspection of sanitary conditions of certain other premises of the remand prison (not apparently related to the cells where the second applicant was detained), dated January 2006, as well as two reports of the inspection of the ordinary cells where the second applicant was detained dated February 2004 and January 2005, which concluded that sanitary condition of the cells was satisfactory. The Government also produced a contract with a firm in charge of disinfestation of the remand prison, dated 15 August 2005, and several ‘certificates of completed work’, dated 2006 and later.

Further, in the Government's words, while in detention in the isolation cell the second applicant was provided with hot meals three times a day in accordance with the established standards. The Government produced extracts from prison's kitchen record, describing composition of the meals served to the prisoners. The second applicant had a right to a one-hour daily walk during the daylight hours.

On the hearing days the detainees were provided with dry meals; in the court building they were given hot water to prepare tea, coffee, or instant food. As follows from the documents submitted by the Government, in 2004–2005 the second applicant took part in over 160 days of hearings. However, he always refused to take the dry meal; he preferred the food he received from his relatives. The Government produced a handwritten waiver by the second applicant whereby he refused to receive dry meals. The doctors did not recommend him any special diet, so he could have eaten the same food as other prisoners.

On 4 July 2003, soon after the arrest of the second applicant, the first applicant was summoned to the GPO and interviewed as a witness in the criminal case concerning Apatit. He appeared before the investigator and gave testimony. During the interview he was assisted by Mr Drel, one of his and the second applicant's lawyers.

On an unspecified date in July 2003, the First Deputy General Prosecutor, Mr Biryukov, ordered that the case concerning tax payments of the trading companies registered in the Lesnoy town, which had been closed on 29 August 2002 (see paragraph 31 above), be re-opened and transferred to the GPO.

On 8 July 2003 the prosecution searched the premises of the regional office of the State Property Fund, situated in Murmansk, which could have held information on the privatisation of Apatit.

On 9 July 2003 the investigators searched the premises of Apatit.

On 10 July 2003 the prosecution searched the premises of the bank Menatep Sankt-Petersburg, which was affiliated with Yukos. The search was authorised by the Deputy General Prosecutor, Mr Biryukov, in a decision of 8 July 2003.

On 29 July 2003 the GPO searched the premises of Russkiye Investory Plc.

On 7, 8 and 14 August 2003 new searches were carried out in the premises of Menatep Sankt-Petersburg.

On 16 August 2003 the GPO obtained a report by two experts, Mr Yeloyan and Mr Kupriyanov. That report calculated damages allegedly suffered by Apatit as a result of the manipulation with the trading prices of apatite concentrate. It compared the net profit of Apatit during the periods when apatite concentrate was sold independently and when it was sold through intermediaries proposed by the Yukos management.

On 3 October 2003, based on the warrant issued by the Deputy Prosecutor General on the same day, the investigative team, headed by investigators Mr Pletnev and Mr Uvarov, carried out the first search in Yukos's premises and in the homes of its senior managers located in the village of Zhukovka, Moscow Region, building no. 88. In particular, the investigators searched the homes of the second applicant, the homes of Yukos vice-president Mr Brudno, and the home of the applicant's friend, Mr Moiseyev. The investigators also searched the office of Mr Dubov, a Duma Deputy. According to the applicants, the investigators entered the building and started the searches without having produced a search warrant. The searches were attended by several attesting witnesses, in particular Ms Ardatova and Ms Morozova, cleaning ladies.

The applicant indicated that the search had been carried out simultaneously on several floors of the building, so the attesting witnesses had been physically unable to see what materials had been seized. Furthermore, the documents found during the search were seized and packed in bulk, without detailed lists enumerating particulars of those documents. The documents seized during the search were later added to the materials of the case-file. Some of the documents and objects seized during that search were added to the case file by an order of 11 February 2004.

On 9 October 2003 the investigators, based on a search warrant issued on the previous day by the Deputy Prosecutor General, searched the offices of ALM Feldmans, a law firm providing legal services to Yukos, and the offices of the applicants' lawyer, Mr Drel, all located in the Zhukovka village. According to Mr Rakhmankulov, who testified about the circumstances of the searches later at the trial, he had asked investigator Mr Karimov whether the latter had been aware that the rooms in question had been rented by the law office of Mr Drel. Mr Karimov had replied in the affirmative. Mr Moiseyev testified that he had informed the investigators that the offices they had been searching belonged to a lawyer. At the entrance to the floor of the building there had been a sign identifying Mr Drel as a lawyer. The files seized during the search were labelled as containing lawyers' notes related to the defence of the applicants. The search report mentioned that the seizure had been carried out ‘in the Moscow Region, village of Zhukovka 88a, 4th floor, rented by ALM Law Bureau …’, and that one of the offices had a tag indicating ‘work papers of lawyer Mr Drel’. Some time after the start of the search Mr Drel arrived in Zhukovka. He informed the investigators that he was a lawyer with the Moscow Bar and protested against the breaking into his office. However, the investigators did not let him enter the building. At the end of the search he was allowed to make his comments on the search record. A separate sheet with comments on the procedure in which the search was carried out stated: ‘Lawyer Drel, who appeared at the premises around 7 p.m., despite his protests, was taken by police officers [out] of the territory on which building No. 88a was located’ and notes ‘breaking and entering into Moscow City Bar Association lawyer Drel's [office]’.

As a result of those two searches, a large number of documents were seized, as well as hard drives of several computers. The hard drives were examined by the investigators at the GPO premises in the presence of attesting witnesses and then transmitted to experts for the extraction of information contained therein. The experts drew up a list of files that had been found on the drives, but neither the drives themselves nor the list of files were attached by the GPO to the applicants' criminal case materials. Electronic documents from those drives were presented to the trial court in the form of print-outs. The applicants claimed that there had been a discrepancy between the amount of information on hard drives of the computers seized during the search and the amount of information produced to the court. Furthermore, the applicants claimed that the hard drives seized had not been properly packed and sealed, so it was possible to add information to them while the drives were in the possession of the GPO.

Over the following days the GPO also searched the headquarters of the political party Yabloko and an orphanage which was under the patronage of the first applicant; they removed from the latter premises a computer server, said by the authorities to hold Yukos financial data.

On 10 October 2003 a GPO investigator, Mr Karimov, refused to grant the petition of the second applicant to attach official correspondence related to the inquiry conducted following Presidential Directive No. Pr-2178 (see paragraph 32 above) to the case materials.

On 17 October 2003 Mr Drel was summoned to the GPO for questioning in relation to the criminal cases against the second applicant. Mr Drel refused, referring to his status as advocate and his position as the second applicants' representative in the criminal proceedings at issue. Later the Moscow City Chamber of Lawyers ruled that to answer questions in the circumstances would be a violation of the law ‘On the Advocacy and the Bar in the Russian Federation’.

On the same day the prosecution brought charges of personal tax evasion against Mr Shakhnovskiy, a close friend and business partner of the first applicant. According to the prosecution, he fraudulently reduced the amount of personal income tax due by using the ‘individual entrepreneur’ scheme (see paragraph 15 above).

On 20 October 2003 the investigator ordered a seizure from Trust Investment Bank and received the sanction of First Deputy Prosecutor General, Mr Biryukov, for that measure.

On 21 October 2003 the Deputy General Prosecutor, Mr Kolesnikov, said in a press conference that charges might be brought against other senior managers of Yukos. On the same day the investigator again searched the premises of the Menatep Sankt-Petersburg bank.

On 22 October 2003 the investigator searched the premises of the Trust Investment Bank.

On 25 October 2003 the first applicant was arrested in Novosibirsk and transported to Moscow where GPO charged him with business fraud and tax evasion. Further, at the request of the GPO, the Basmanniy District Court of Moscow decided to detain the applicant pending the investigation. During the following months his detention was extended several times.

On the same day Mr Drel was summoned to the GPO to testify as a witness. He refused to testify, referring to his professional status and his position in the case of the first and second applicants.

On 27 October 2003 the GPO attempted to interrogate Mr Drel as a witness. He refused to testify.

On the same day Mr Shakhnovskiy was elected to serve as a Senator, i.e. member of the upper chamber of the Russian Parliament. Later he resigned following a request by the Prosecutor General in which the latter claimed that Mr Shakhnovskiy's election had been irregular and thus null.

On 3 November 2003, as a consequence of his arrest, the first applicant resigned as chief executive of Yukos.

On 10 November 2003 the first applicant was formally charged by the GPO.

On 11 November 2003, an investigator of the GPO investigative team arrived at the Trust Investment Bank for the second time and carried out another seizure with reference to the search warrant of 20 October 2003.

On an unspecified date in November 2003 the Tax Service lodged, within criminal proceedings against the applicants, a civil claim against them on behalf of the State. The Tax Service claimed that the applicants, in their capacity as Yukos senior managers, caused the State damages in the amount of 17,395,449,282 Russian roubles (RUB) (taxes not paid by the trading companies) plus RUB 407,120,540 (taxes unlawfully reimbursed from the State budget). The overall amount of the civil claim was RUB 17,802,569,822 (over 510 billion euros (EUR)); these amounts corresponded to the amounts mentioned in the bill of indictment on company tax-evasion charges brought against the applicants. The statement of claim was lodged by one of the Deputy Ministers, Mr Shulgin. The text of the statement by Mr Shulgin did not contain any calculation of the amounts due by the applicants.

On 5 and 16 December 2003 a GPO investigator conducted a search in Tax Inspectorate no. 5 for the Central District of the City of Moscow and seized some documents. According to the applicants, no prior approval had been obtained from the General Prosecutor for that search.

Later in 2003 the Moscow City Tax Inspectorate No. 5 lodged additional civil claims against the applicants claiming tax arrears and penalties related to the personal tax evasion charges.

The charges against the applicants formulated by the GPO may be summarised as follows:

On 5 February 2004 Mr Shakhnovskiy was convicted by the Meshchanskiy District Court, presided by Judge Kolesnikova, for personal income-tax evasion. In those proceedings Mr Shakhnovskiy did not plead guilty; however, he had reimbursed to the State the amounts of outstanding taxes and penalties as calculated by the Tax Service. Execution of the sentence was conditionally suspended by the Judge.

Judge Kolesnikova found that Mr Shakhnovskiy had deliberately included false information into his personal tax declarations by stating that he had received payments from Status Services for some ‘consulting services’, although he had been aware that de facto he had received the aforesaid amounts for his work in Yukos (pages 22–23 of the judgment). In support of those findings Judge Kolesnikova referred, inter alia, to an internal memo addressed to the first applicant and written by Ms Kantovich, one of the employees of Yukos-Moskva, on behalf of Mr Aleksanyan, the then head of the legal department of Yukos. That memo analysed various methods of tax minimisation, in particular the ‘individual entrepreneur’ scheme. The Judge also referred to identical contracts concluded between Status Services and other Yukos senior managers, including the second applicant, and to the corporate credit cards in the name of the second applicant sent to him as the head of Status Services and seized during the search in Zhukovka on 3 October 2003.

On 8 June 2004 Judge Kolesnikova ruled that the case of the first applicant should be tried jointly with the cases of the second applicant and of Mr Kraynov (director of Volna, a firm which had participated on behalf of Menatep in the privatisation of Apatit). Upon the joinder of the cases the first applicant was given a copy of the second applicant's case-file (165 volumes). The second applicant was given a copy of the first applicant's case file (227 volumes). The case thus ran to 392 volumes in all at the start of the trial. Subsequently the applicant's legal teams made copies of those case files for their use.

The trial court in the joint case was composed of three judges: Ms Kolesnikova (president, a professional judge), Ms Klinkova and Ms Maksimova (lay assessors, non-professional judges). The court was assisted by seven secretaries who kept a summary record of the hearings. No verbatim record was made; however, the defence made an audio recording over the course of the trial. The prosecution was represented by Mr Shokhin and Mr Arkhipov. The united defence team was composed of Mr Aleksanyan, Mr Baru, Mr Drel, Mr Gridnev, Mr Krasnov, Ms Liptzer, Ms Lvova, Mr Mkrtychev, Ms Moskalenko, Mr Padva, Mr Rivkin, Mr Shmidt (who died in 2012), and several others.

The hearings were public. They took place in a courtroom which held, according to the applicants, up to thirty people. The defence made an application for the case to be heard in a larger courtroom, but the court did not respond. Further requests were made by the defence for the trial to be televised or audio-recorded. However, no external media transmission of the hearings was allowed. A number of journalists were present in the courtroom.

On 16 June 2004 the court held the first hearing, which was immediately adjourned due to the illness of one of the defence lawyers.

On 23 June 2004, at the second hearing, the first applicant requested the court to grant him more time to study the materials in the second applicant's case. That request was supported by the first applicant's defence lawyers who stated they also needed more time. The defence claimed that they needed at least one more month to become conversant with the additional case materials. The court gave the defence time until 12 July 2004.

On 12 July 2004, Ms Moskalenko (one of the defence lawyers for the first applicant) complained to the court about the insufficiency of the time granted. She indicated that in the time allocated by the court she had succeeded to familiarise herself with only 72 volumes of the second applicant's criminal case. The Meshchanskiy District Court refused to give more time.

Before the prosecution started presenting its case, the court discussed the arrangements for the future trial. The court indicated that the hearings would start at 11 a.m. and that it would not sit on Wednesdays, which would thereby assist the parties in the preparation for the trial. Those arrangements persisted during the first phase of the trial when the prosecution was presenting its case (July - November 2004).

The two applicants were held in a barred dock resembling a metal cage, guarded by armed escorts. The third co-defendant, Mr Kraynov, who was not detained on remand, had a place in the courtroom outside the cage. The applicants were able to communicate with the defence lawyers through the bars. The conversations were always within the hearing of the escort officers and sometimes of the prosecutors, and the escort officers prevented the applicants and their lawyers from exchanging any documents.

On 23 August 2004 the defence lawyers complained to the court that they were unable to show the defendants case materials in the courtroom and were unable to discuss the case confidentially with them. The escort officers required that the lawyers did not approach closer than 50 cm to the cage where the applicants were detained. Mr Padva, the lead lawyer for the first applicant, explained that he had to speak very loudly to his client to be heard at such a distance. The first applicant, in his turn, asked the court to be shown instructions or rules which fixed that distance and, more generally, defined the conditions of the communication between a defendant and his lawyer in the courtroom. The prosecutor replied that the defendants had to solve the matter not with the judge but with the administration of the remand prison or the escort service. Judge Kolesnikova then explained to the parties that she was not against them communicating during the breaks. However, in her words, the question of transmitting documents between the defence lawyers and the applicants did not belong to the competence of the court; the defendants were detained on remand and all questions related to the exchange of documents were within competence of the respective institution, in particular the escort service, and were regulated by the internal rules. If the exchange of the documents was compatible with those rules, the court would not be against it.

At the hearing of 26 August 2004 Mr Padva again asked the court to allow him to show documents to his client. He agreed that he would submit to the judge all documents he would show to his client. According to him, the remand prison administration did not object to such a method of communication, provided that it satisfied the judge. The judge checked that information with the chief escort officer and then ruled that the court would review all the documents which the defence lawyers wanted to show to their clients. Mr Padva agreed that if those documents existed in a computer format, he would print them out and show them to the court in advance.

On 27 August 2004 the defence lawyers once again complained that it was impossible to communicate effectively with the applicants during the questioning of witnesses, emphasising that if an adjournment was announced every time one or other question had to be discussed with the applicants in the court session, the trial would progress very slowly. The court responded by asserting that the discussion of any questions whatsoever with the applicants was possible only during the adjournments.

On 31 August 2004 the first applicant personally complained to the court about the difficulties he was facing. He explained that his lawyers had initially been permitted to stand about 50 centimetres away from his cage but that that situation had changed and they were now required to stand about one metre away, while additional guards had recently been placed between the lawyers and the cage. The applicant explained that it was now impossible to have any confidential discussions at all with his lawyers whilst in the courtroom. In response, the head of the escort guards referred to a ‘security plan’ which necessitated these arrangements.

Over the following months the defence submitted several requests seeking to facilitate contact with the applicants in the courtroom, but the court refused to change the security arrangements. Thus, on three occasions (on 28 December 2004, 14 February 2005 and 15 February 2005) the first applicant prepared draft written testimony. On each occasion his lawyers were able to review the testimony only after the court had reviewed the drafts.

On 28 September 2004 Ms Leutheusser-Schnarrenberger, the Special Rapporteur appointed by the Parliamentary Assembly of the Council of Europe, visited the Meshchanskiy District Court. She asked the court, through the first applicant's lawyers, to allow her to speak to the first applicant. However, the court refused permission.

In November 2004 the court moved on to the examination of the evidence submitted by the defence. On 11 November 2004 the court changed its working schedule and decided that it would start the hearings at 9.30 a.m. instead of 11 a.m. As a result, the duration of the time spent by the applicants in the court increased.

At the end of 2004 the trial arrangements changed again. On 31 December 2004 the Meshchanskiy Court ruled that it would no longer observe Wednesdays as a non-court day. On 18 January 2005 the defence tried to obtain adjournments of the Wednesday hearings, but the request to that end was refused. The judge however explained to the parties that they could ask for an adjournment at any moment. The defence used that opportunity successfully at least twice: on 25 January and 22 February 2005.

On 9 March 2005 the defence lodged an application for the judges to withdraw on the basis that their decisions to date had been in violation of Russian and international law. They referred to the one-sided treatment of evidence, serious limitations on contact between the applicants and their lawyers, the unfair denial of adequate time to prepare the case, etc. That application was dismissed.

The applicants pleaded not guilty. The defence maintained, firstly, that the whole case had been politically driven and that the GPO was acting in bad faith. Further, they challenged the admissibility of evidence relied upon by the prosecution, in particular as regards those documents which had been seized during the searches in Zhukovka, in Mr Drel's offices and at the second applicant's home in 2003.

As to the charges concerning company income tax evasion in connection with the Lesnoy trading companies, the applicants claimed that they had had no relation to those companies, that they had never heard of them, directed their operations or participated in their creation.

Alternatively, the defence claimed that all tax cuts had been obtained by the trading companies in a lawful manner, that the law at the time allowed payment of taxes with promissory notes and that all the promissory notes had been eventually honoured, so the State budget had suffered no losses. Even if some of the financial operations described in the bill of indictment and impugned to the applicants had taken place, they did not amount to a criminal offence. The law, as applied at the relevant time, regarded those financial practices as perfectly legal or at least tolerated them. In support of those claims the defence sought to adduce a large number of documents, expert opinions and witness testimonies.

As to the personal income tax evasion charge, the first applicant insisted that he had rendered services to Status Services and Hinchley; however, he refused to give more details on this point, referring to his right to remain silent provided by Article 51 of the Constitution. He was unable to give details concerning the conclusion of the service agreements with these two firms, and did not explain when and where exactly he had been providing services to them. The second applicant gave evidence in similar terms. In addition, he contested the allegation of the prosecution authorities that he had been a chief executive of Status Services. At the trial the first applicant testified that he decided to obtain a licence and become a self-employed entrepreneur at the advice of his lawyers.

On 25 March 2005 the defence advised the court that, following the prosecution's closing submissions, the defence would need five days to prepare a reply.

On 30 March 2005, after the prosecution had presented their closing submission, the defence confirmed that it would need five days to prepare a reply. The court ordered that the trial would continue at 9.30 a.m. on 1 April 2005.

On 27 April 2005 the Meshchanskiy District Court declared that it would deliver its judgment on 16 May 2005.

Between 16 May and 31 May 2005 the court read out its judgment. In all the trial lasted from 8 June 2004 until 31 May 2005 and the court sat for 159 days. During the trial, 34 further volumes of materials were added to the case file (fifteen volumes of the trial record and nineteen volumes of motions, expert reports and other documents added during the trial).

The Meshchanskiy District Court delivered two separate judgments. The first judgment concerned the allegation of misappropriation of Apatit shares (see Section 2 (a) above, §§ 91 et seq.). The court found the applicants guilty as charged; however, because the crime had been committed more than ten years previously, namely in July 1994, the court applied the statute of limitations and relieved the applicants from criminal liability. The text of that judgment runs to 90 pages.

The second judgment related to the other charges against the applicants, which were not time-barred (hereafter — the ‘principal judgment’). That judgment is 660 pages long; it may be summarised as follows.

On 9 October 2005 the first applicant was transferred from the remand prison.

On 15 October 2005 the first applicant arrived at penal colony FGU IK-10, located in the town of Krasnokamensk, Chita Region. On 20 October 2005 the first applicant's wife was notified of that by post.

The distance between Moscow and Chita is about 6,320 km by motorway. According to the Government, FGU IK-10 is located about 580 km from the city of Chita. There is a railway line between Chita and Krasnokamensk; the trains have ‘sleeping wagons’ (first-class compartments for two persons) with Internet connection and a dining car. The ‘transport infrastructure’ within Krasnokamensk allowed the visitors to reach the territory of the penal colony.

According to the first applicant, penal colony FGU IK-10 in Krasnokamensk was not quite the furthest penal colony from Moscow but it was the least accessible, because direct flights were available to the colonies further from Moscow. To reach Krasnokamensk from Moscow involved a minimum of two days. It was a long and strenuous journey, made even more difficult by the infrequency of flights from Moscow to Chita. A flight from Moscow to Chita took approximately six and a half hours (occasionally more, when the aircraft had to refuel in Yekaterinburg). On arrival in Chita, there was a seven-hour wait before boarding a train for Krasnokamensk, which took another fifteen hours to arrive. Alternatively, the visitors had the choice of a train ride from Moscow, 106 hours on an uninterrupted run. This made it very arduous for the first applicant's lawyers and family to gain access to him, and inevitably some of them were not seeing the first applicant as much as they otherwise would. The first applicant's lawyers described the journey as ‘very exhausting and debilitating’. Mr Mkrtychev, a lawyer who undertook the journey from Moscow to Krasnokamensk on eight occasions, testified that he had never seen any ‘sleeping wagons’ or a dining car on the trains on which he had travelled. Internet and mobile phone reception were also impossible, contrary to what the Government had maintained. The first applicant further maintained that Krasnokamensk itself was subject to huge extremes in climate. According to Mr Mkrtychev, during his first journey there in October 2005 the temperature was approximately minus ten degrees Celsius, with a freezing and almost unbearable wind. On one of his later visits the temperature dropped to 41 degrees below freezing point. The short summer was equally oppressive, with blistering heat and swarms of mosquitoes.

On 25 October 2005 the first applicant's wife visited him in the colony. She was entitled to a ‘long family visit’ and stayed with the first applicant until 28 October 2005.

The decision to send the first applicant to the Krasnokamensk colony was taken by the Federal Service of Execution of Sentences — FSIN. On 9 January 2006 the defence lodged a complaint challenging that decision. They claimed that the decision was unlawful and arbitrary. In addition, the first applicant's lawyers pointed out that the second applicant had also been sent to a very remote region of the Russian Federation, in apparent disregard of the provisions of Russian law.

At the hearing the representatives of the FSIN argued that there had not been enough places in the penitentiary facilities in Central Russia, and that a decision had been taken that five convicts should be sent from Moscow to various regions of Russia. There was no requirement in the law to consider the individual circumstances of each convict; as a result, the first applicant was among the five detainees who had been sent to the Chita Region.

The first applicant in the proceedings referred in particular to the figure mentioned in an interview by the then Minister of Justice Mr Chayka, who said that in September 2005 the admission capacity of Russian colonies was 786,753 places, whereas only 637,079 convicts were detained there. In another interview by Mr Kalinin, the then director of the FSIN, acknowledged that there had been free places in some of the colonies.

On 6 April 2006 the Zamoskvoretskiy District Court of Moscow dismissed the first applicant's claim and, referring to Article 73 § 2 of the Code on the Execution of Sentences, upheld the FSIN's decision as lawful and justified. The District Court found that under Article 73 of the Code of Execution of Criminal Sentences a convicted person had the right to serve his sentence in the region where he was convicted or where he had lived before. However, if in that prison there were no places vacant, the detainee could be sent to serve his sentence in the nearest region where it was possible to accommodate him. The District Court referred to a decision of FSIN which defined which colonies must accept convicts from Moscow and in what proportions. According to the District Court, that decision was taken within the competence of FSIN, and did not violate the law. The District Court also held that if the first applicant was placed in a nearer colony the rights of other prisoners might have been violated. The court ruled that information contained in the interviews of Mr Chayka and Mr Kalinin on the number of places vacant in the Russian colonies was inadmissible evidence. On 13 June 2006 the Moscow City Court upheld that decision.

While in the Krasnokamensk colony the applicant first continued to work with his lawyers. However, his contacts with them were seriously limited. Thus, at the beginning of his prison sentence the first applicant was only permitted to see his lawyers at the end of the working day and only one lawyer at a time was allowed to see him.

On 10 November 2005 Ms Terekhova, one of the applicant's lawyers, was denied access to the first applicant. On 15 November 2005 the colony staff seized documents from Mr Mkrtychev. On 16 November 2005 Ms Levina was subjected to a body search by the colony staff when visiting the first applicant; the procedure of the search involved undressing. On 17 November 2005 Ms Khrunova was also subjected to a similar body search. On 18 November 2005 Ms Terekhova was body-searched on her way to and from the meeting with the applicant, and her professional files were examined. On 23 and 26 November 2005 she was body-searched again in the same manner.

From 29 November to 1 December 2005 the first applicant was visited by three of his lawyers in connection with his application to the European Court of Human Rights. They needed to see the first applicant together but were not permitted to do so. Later the first applicant successfully challenged the prison regulations concerning visits by lawyers. In a judgment dated 25 May 2006 the Supreme Court held that the rule was invalid. However, the colony authorities continued to refuse the lawyers' access to the first applicant during working hours.

During the meetings with his lawyers the first applicant was separated from them by a screen which ran from wall to wall and floor to ceiling. Such arrangements had been introduced in the penal colony in question since the first applicant's arrival. The first applicant was not permitted to retain legal documents brought to him by his lawyers on legal visits. The first applicant had a right to copy part or all of a document in his own handwriting in the course of a legal visit. As a result, the first applicant was unable to work with lengthy documents, such as the application before the Court.

In November 2005 the first applicant's British lawyers, Mr Nicholas Blake and Mr Jonathan Glasson, asked permission to meet him. In February 2006 they applied for a Russian visa, but the Russian embassy did not deliver visas to them for the reasons which remain unknown.

On 11 March 2006 Mr Khrunova's professional ID was confiscated by the colony staff.

While in the Krasnokamensk colony the first applicant was subjected to a number of disciplinary proceedings regarding his conduct in the colony, which resulted in three periods of solitary confinement for a total of twenty-two days.

On 12 December 2005 the first applicant left his work-place in the sewing shop because his equipment was broken and he needed to find a repair worker. On the following day he was formally reprimanded by the administration for having done so.

On 16 January 2006 the applicant received by post the texts of two regulations by the Ministry of Justice concerning the regime of detention of convicted persons. Those items of mail had passed through the colony censor. On the following day those regulations were seized from the first applicant and on 24 January 2006 the first applicant received a second reprimand for keeping unauthorised printed materials. He was placed in a solitary confinement cell for five days.

On 9 February 2006 the Krasnokamensk Town Court quashed the decision of 12 December 2005 to reprimand the first applicant for absence from work.

On 17 March 2006 the first applicant was subjected to seven day's confinement in the punishment block for drinking tea in the communal area instead of in a canteen.

On 18 April 2006 the Krasnokamensk Town Court quashed the second reprimand of 24 January 2006.

On 3 June 2006 the first applicant received another reprimand. He was placed in the solitary confinement cell for ten days.

On 27 September 2005 the Moscow branch of the Federal Penitentiary Agency decided to send the second applicant to serve his sentence in a correctional colony FGU IK-3 in the Kharp township situated on the Yamal peninsula (Yamalo-Nenetskiy region, Northern Urals, north of the Arctic Circle). That penitentiary institution was a ‘strict regime’ colony which had a special ‘ordinary regime’ zone. The second applicant lived in that zone.

The distance between Moscow and Kharp is over 3,300 km by road. According to the Government, Kharp township had a direct railway connection with Moscow. Several trains ran on that line, including ‘Polar Arrow’, a ‘high-class train. That train had all necessary amenities, including two-bed compartments in ‘economy’ and ‘business’ class, services for children and a restaurant. Further, Moscow had a direct air connection with Salekhard, a nearby town. It was possible to get to Kharp from Salekhard by train or by car, through the town of Labytnangy and across the Ob River.

In the second applicant's submission, the Government's argument that there was a direct railway connection with Kharp township and direct flights between Salekhard and Moscow was certainly true. However, the train journey usually took 48 hours, while to reach Kharp from Salekhard airport one had to cross the Ob River: there was a ferry in the summer and an ice-crossing in the winter. In autumn and spring, when there was no ice, the river could only be crossed by air-cushioned vehicles, which was quite dangerous.

On 11 January 2006 Mr Kalinin, the Head of the Federal Penitentiary Agency, stated in an interview that the second applicant had been sent to that colony in order to guarantee his own safety.

On 23 January 2006 the second applicant's lawyers wrote a letter to the Department of the Federal Penitentiary Agency in the Kaluga region, adjacent to the Moscow region, seeking to obtain information about the number of detainees in the ordinary-regime colony (FGU IK-2) situated in that region. In the letter dated 31 January 2006 the second applicant's lawyers were informed that the Kaluga colony was capable of accepting up to 50 detainees; however, by 1 October 2005 only 48 people were serving their prison sentence in that colony. Between 1 and 10 October 2005 that number remained the same. Each detainee had 2 square metre of personal space in the colony.

On an unspecified date the second applicant's lawyers challenged in court the decision of the FSIN. They asserted that the second applicant had the right to serve his sentence in a colony situated in Moscow or in the Moscow region, where he had lived before his conviction. The defendant explained that since Moscow was a capital city, it had no correctional colonies on its territory.

On 16 February 2006 the Zamoskvoretskiy District Court of Moscow dismissed the complaint. The District Court established that there were no appropriate penitentiaries in Moscow; furthermore, it was impossible to accommodate all the convicts from Moscow in the Moscow Region. According to a letter from the head of the Special Register Bureau of the FSIN (byuro spetsialnogo utcheta), it was equally impossible to place the second applicant in correctional colonies in the regions adjacent to Moscow because of overcrowding, repair work, allocation of premises for remand prisons, etc. On 27 August 2003 and 28 July 2005 the FSIN had established quotas for sending convicts from Moscow to other regions of Russia. The quota for the Yamal peninsula was five persons. The fact that the second applicant suffered from certain chronic diseases was not an absolute obstacle to his being sent there. Consequently, the FSIN's decision to send the second applicant to a colony on the Yamal peninsula was lawful and justified.

On 26 May 2004 the Commercial Court of Moscow ordered Yukos Oil Company Plc to pay taxes totalling RUB 47,989,073,311, fines in the amount of RUB 32,190,430,314 and a penalty in the amount of RUB 19,195,605,923. This award related, in particular, to taxes due by Yukos for the year 2000. The Commercial Court's award included (but was not limited to it) reassessed taxes for 2000 attributable to the operations of Mitra, Vald Oil, and Business Oil, i.e. three of the four ZATO trading companies that formed the basis for the civil damages award made against the applicants within the criminal proceedings. The Commercial Court found that those companies (along with trading companies registered in low tax zones) had obtained tax cuts unlawfully. The Commercial Court further decided that their operations with Yukos oil had to be treated as operations of Yukos itself, because these companies were nothing more than a ‘façade’ for Yukos, and Yukos obtained all benefits from those operations. Consequently, the Commercial Court imputed the unpaid taxes of those trading companies directly to Yukos (for more details see the judgment in the Yukos case, § 48). The decision of the Commercial Court did not contain a detailed calculation of the amounts due by each trading companies.

Those tax re-assessments were upheld on appeal on 29 June 2004, and on cassation appeal on 17 September 2004.

On 3 October 2006 the Meshchanskiy District Court ordered that the first applicant pay RUB 127,564,727.04 to the Moscow Tax Inspectorate no. 2 in relation to the unpaid personal income taxes.

Over the following months commercial courts examined several other cases opposing Tax Service and Yukos concerning tax underpayments. The majority of the claims by the Tax Service were upheld, which eventually led to the forced sale of the assets of Yukos and its bankruptcy.

In the course of the proceedings against the applicants and shortly afterwards the GPO made several attempts to disbar the lawyers who represented the applicants before the domestic instances and the Court.

Thus, of nineteen lawyers acting for the applicants and in associated cases, twelve have been the subject of disbarment proceedings (Ms Artyukhova, Mr Drel, Ms Moskalenko, Mr Shmidt, Mr Mkrtychev and others). In particular, the GPO sought disbarment of Ms Moskalenko in March 2007 on the basis that her absence from Chita ‘grossly violated the right of [the first applicant] to defence’. To counter those accusations the first applicant had to make a statement that he was fully satisfied with Ms Moskalenko's work. Mr Drel was accused of acting in breach of professional conduct by not appearing at a hearing on 14 September 2005. On 23 September 2005 the Ministry of Justice sent a recommendation to the Moscow City Chamber of Lawyers to institute disciplinary proceedings against the lawyers, indicating that they should be disbarred. That same day the press service of the GPO published a demand on the part of the GPO for the institution of disciplinary proceedings and the disbarring of all the first applicant's lawyers, with the exception of Mr Padva. The demands of the GPO, the Moscow City Court and the Ministry of Justice were subsequently rejected by the Chamber of Lawyers.

In the course of the proceedings the lawyers' belongings were inspected, and some of the lawyers were subjected to bodily searches involving undressing (Ms Terekhova, Ms Levina and Ms Khrunova); one was detained in custody and left Russia for fear of prosecution. Two lawyers were assaulted by unknown individuals.

In November 2005 the International Protection Centre, which Ms Moskalenko founded, was subjected to a tax audit of the entirety of its activities.

Early in the morning of 23 September 2005, several hours after the appeal court had rendered its judgment, Mr Amsterdam, one of the first applicant's foreign lawyers, was visited in his hotel room by law-enforcement officers. Later that day his visa was revoked and he was ordered to leave Russia within 24 hours.

The question of harassment of the first applicant's lawyers was raised by several former managers of Yukos in the extradition proceedings in which they took part in the United Kingdom (for more details see below). Senior Judge Workman of the London Extradition Court, who examined extradition requests by the GPO, concluded that the first applicant's lawyers had been subjected to harassment. In particular, he held as follows:

Simultaneously with the investigation into the misappropriation of shares and tax evasion the GPO conducted a separate investigation into other facts related to the business activities of Yukos and its managers in 1998–2003. In particular, the applicants were suspected of having embezzled the profits arising from the output of the companies affiliated with Yukos. The applicants were also charged with money laundering.

In 2009 the second case was brought to trial. On 27 December 2010 the applicants were convicted by the Khamovnicheskiy District Court. This conviction was upheld on appeal on 24 May 2011.

On 21 December 2011, the Presidential Council of the Russian Federation for Civil Society and Human Rights submitted a 400-page report on the applicants' second trial. The report contained contributions from a group of Russian, European and American experts and scholars. None of the expert group found any support for the allegations of embezzlement or money laundering. Having considered the expert reports, the Presidential Council for Civil Society and Human Rights issued a series of recommendations in which, amongst other things, it called for the judgment to be repealed and describing the second case as ‘a miscarriage of justice’: in particular, the report held that the applicants were convicted for acts that were not directly prescribed by the criminal law and did not contain features of a corpus delicti, as well as without due process. The experts pointed out that the verdict contradicted judgments in other Yukos-related cases, which have not been overturned, and which subjected Yukos to punitive taxation on oil sales; in this case, the same oil was found to have been stolen, which would have precluded it from being taxed.

Some of the applicants' former colleagues and business partners left for the UK for fear of prosecution (in particular Ms Chernysheva, Mr Maruev, Mr Temerko, Mr Gorbachev, Mr Burganov and others). The GPO lodged requests for their extradition to Russia. All of the extradition requests by the GPO were eventually dismissed by the British courts on the ground that those individuals might not receive a fair trial at home. In particular, in March 2005 Judge Workman, who reviewed one of the extradition requests, concluded that ‘it was more likely than not that the prosecution of Mr Khodorkovskiy was politically motivated.’ The GPO did not appeal against those decisions. A similar conclusion was reached by the Nicosia District Court (Cyprus) in a 2008 extradition case concerning former Yukos managers. On 31 July 2007 Czech High Court upheld the refusal of a lower court to extradite to Russia ex-employee of Yukos, Ms Vybornova. On 31 August 2007 the Vilnius Regional Court refused the extradition of Mr Brudno. Extradition of former Yukos employees and business partners was refused by the Estonian, German and Israeli courts, always with reference to the improper motives of prosecution.

The GPO also requested legal assistance from a number of European countries where Yukos' assets were presumably held or operations had been conducted. The Swiss Federal Tribunal ordered the Swiss government not to co-operate with the Russian authorities on account of such requests after it concluded that the applicants' trial had been politically motivated.

In particular, the Swiss Federal Tribunal in its judgment of 13 August 2007 concluded that all of the facts, taken together, ‘clearly corroborated the suspicion that criminal proceedings have indeed been used as an instrument by the power in place, with the goal of bringing to heel the class of rich oligarchs and sidelining potential or declared political adversaries’. It noted, in particular, that ‘the political … nature of the proceedings in Russia was reinforced by the violations of guarantees respecting human rights and the right to a defence’ and referred to the the conditions of the execution of the applicants' sentence.

In September 2010, in Rosinvest Co UK Ltd v. the Russian Federation, the Arbitration Institute of the Stockholm Chamber of Commerce considered the tax claims that had forced Yukos into bankruptcy in the context of a claim by a Yukos shareholder Rosinvest Co. for loss of investments on the basis of a 1989 bilateral UK-USSR treaty for the protection of capital investments. The Tribunal found that the Russian Federation had breached Article 5 of the IPPA, forbidding expropriation of the investments of investors of either Contracting Party. The Tribunal found that ‘the treatment of Yukos and of Mr Khodorkovskiy changed dramatically after the latter had publicly criticized the Putin administration and after several projects suggested by Yukos seem to have been understood as threatening the government's control over the Russian petroleum resources’.

The applicants also informed the Court about other litigation before the arbitration tribunals which opposed minority shareholders of Yukos and the Russian Government. In particular, the first applicant submitted a copy of the decision of 20 July 2012 by the Arbitration Institute of the Stockholm Chamber of Commerce in the case of Quasor de Valores, Orgor de Valores, GBI 9000 and ALOS 34 v. the Government of the Russian Federation. In this case the Tribunal found in favour of the investors and concluded, in particular, that tax minimisation schemes employed by Yukos had been lawful, and that the domestic enforcement proceedings against Yukos amounted to a de facto expropriation and were not a genuine attempt to collect taxes.

The applicants' case attracted considerable public attention in Russia and abroad. In the course of the trial and after it many prominent public figures and influential organisations expressed their doubts as to the fairness of the criminal proceedings against the first applicant and his colleagues. The applicants submitted documents to that effect.

In particular, the applicants referred to statements by several high governmental officials who either directly confirmed or supposed that the applicants had been prosecuted for political reasons (such as Mr Gref, the Russian Economic Development and Trade Minister, Mr Illarionov, President Putin's Economic Adviser, Presidential Aide Mr Shuvalov (now a First Deputy Prime Minister), the former Minister of Economics Mr Yasin, and Mr Mironov, the Chairman of the upper chamber of the Russian Parliament.

The applicants relied upon the public statements and court testimony of Mr Kasyanov, the Russian Prime Minister at the time of the applicant's arrest and detention. Thus, in his interview to Echo Moskvy radio station on 27 September 2007 Mr Kasyanov stated as follows:

In May 2010 Mr Kasyanov was called to testify at the applicants' second trial at the Khamovnicheskiy District Court in Moscow. In particular, Mr Kasyanov testified about a conversation he had had with President Putin on 11 July 2003, after the arrest of Mr Lebedev. Mr Kasyanov described his dialogue with Mr Putin on that day in the following terms:

Written depositions of Mr Kasyanov in the same terms were submitted to the Court in 2009. The former Prime Minister also explained that the tax optimisation schemes, which formed a central component of the criminal case against the applicant, had been in conformity with the law at the relevant time. Mr Kasyanov believed that the initial reason for the criminal prosecution of the applicant was the political concern of President Putin and his immediate circle prior to the State Duma election of December 2003. Mr Kasyanov did not think that the criminal prosecution of the applicant had originally been caused by economic reasons, including intent to take over his assets, but that goal appeared subsequently as a concomitant one to the original political goal of removing a political opponent. In the applicants' words, Mr Kasyanov's evidence supported that already given by Mr Dubov, a former Duma Deputy.

The applicants also referred to the testimony of senior Yukos executives who had contacts with governmental officials in 2003. Mr Shakhnovskiy testified in 2006 that in 2003 he had met the then Minister of Economy, Mr Gref, who had told him that ‘the real target of the attack [on the applicants] was the liberal-democratic wing of the government … and not just Mr Khodorkovskiy himself’. Mr Gref also said that ‘Mr Khodorkovskiy had placed himself in the firing line by his overt and powerful support for the liberal wing in Russian politics’. Mr Shakhnovskiy also reported on his meeting with the then Minister of Finances, Mr Kudrin, who said, inter alia, that unpaid taxes had been just a pretext used to crush Mr Khodorkovskiy and take away his company. Mr Nevzlin, a former member of the upper chamber of the Russian Parliament and one of the co-owners of Yukos, has testified that in mid-spring 2003 he had been warned by Mr Lesin, the Media Minister, that a political decision had been taken to attack the first applicant and Yukos. Mr Dubov, another major shareholder of Yukos, testified that on 24 October 2003 (the day before the first applicant's arrest) Mr Surkov (one of the closest aids of President Putin) had said that ‘all government institutions had been forbidden from having any contact with Open Russia and that President Putin had stated that Yukos was going to be eliminated from the political sphere’. Mr Dyatelev, one of the applicants' lawyers, gave evidence that a former Tax Minister, Mr Pochinok, was told by Mr Surkov not to give evidence at the applicant's trial in relation to the tax charges. Mr Ivlev, a lawyer with ALM Feldmans (a law firm working for Yukos), testified that in November 2003 he had met Mr Shuvalov, another aid to President Putin, who had said that there had been absolutely nothing he could do to stop the attacks on the first applicant and Yukos, and implied that decision concerning their fate had been taken at the highest level within the Presidential Administration.

Several international organisations expressed their concern about a possible political underpinning of the first applicant's criminal prosecution in the first trial (see Resolution 1418 (2005) adopted on 25 January 2005 by the Parliamentary Assembly of the Council of Europe, and the statement of the Committee on Legal Affairs and Human Rights of the Council of Europe's Parliamentary Assembly adopted on 6 October 2005).

Further, in May 2009 the European Parliament adopted a Resolution on the Annual Report on Human Rights in the World 2008 and the European Union's policy on the matter, in which it stated that the first applicant was ‘a political prisoner’.

On 23 June 2009 Mrs Leutheusser-Schnarrenberger, the Special Rapporteur of the Parliamentary Assembly of the Council of Europe published her report, entitled ‘Allegations of politically-motivated abuses of the criminal justice system in Council of Europe member states’. At a plenary session on 30 September 2009 the Parliamentary Assembly accepted the report from Mrs Leutheusser-Schnarrenberger and unanimously passed a resolution that noted that the applicants' second trial gave rise to concerns that ‘the fight against legal nihilism launched by President Medvedev is still far from won’. In her report the Special Rapporteur analysed the new trial as an example of a high profile case involving political motivation.

Articles 61–63 of the CCrP describe the situations in which a judge cannot sit on the bench in a particular case. The judge must withdraw if he is an injured party in that criminal case, has already participated in that criminal case in a different capacity, if he is a relative of any participant in the criminal proceedings, or ‘if there are other circumstances which give reason to believe that [the judge] is personally, directly or indirectly, interested in the outcome of the criminal case’. A judge whose impartiality is in doubt must withdraw of his own motion (Article 62 § 1); alternatively, a party to the proceedings may challenge a judge on those grounds (Article 62 § 2). Article 63 of the CCrP provides that the same judge cannot sit on the bench in the trial court and later in the court of appeal or in the supervisory review court in the same case. A judge who sat on the bench during the first trial cannot remain in the composition if the case is remitted for re-trial.

There are no rules governing the participation of the same judge in different, yet related, criminal cases. Article 90 of the CCrP, as in force at the material time, provided that ‘factual circumstances established in a court judgment … which have acquired legal force, should be accepted by a court … without additional verification, if those factual circumstances do not raise doubt … That being said, such a court judgment cannot predetermine the question of guilt of those persons who had not participated in [those] proceedings’.

The Detention on Remand Act of 1995 (Federal Law On the Detention of Suspects and Defendants no. 103-FZ of 15 July 1995), as in force at the material time, provides in section 18 that a detainee has a right to confidential meetings with his lawyers. That section does not define whether the lawyer and the client are entitled to make notes during such meetings and to exchange any documents. Meetings should be conducted out of the hearing of prison staff, but the prison staff should be able to see what is happening in the hearing room. Section 18 establishes that a meeting can be interrupted if the person meeting the detainee tries to hand him ‘prohibited objects, substances, or foodstuff’ or to give him ‘information which may obstruct the establishment of truth in the criminal case or facilitate criminal acts’.

Section 16 of the Detention on Remand Act defines that rules on sending and receiving correspondence, as well as rules on the seizure of prohibited objects, substances or foodstuff may be established by the internal regulations of the remand prisons.

Section 20 establishes that all correspondence by detainees goes through the prison administration, which may open and inspect the mail. Correspondence addressed to the courts, to the ombudsman, to the prosecuting authorities, to the European Court of Human Rights, etc., is free from perusal but correspondence with lawyers is not mentioned in this list (for more details see Moiseyev v. Russia, no. 62936/00, § 117, 9 October 2008). It appears (see the paragraphs immediately below) that the Detention on Remand Act was routinely interpreted by the prison authorities as allowing the latter to seize and inspect correspondence between a detainee and his lawyer.

Section 34 of the Detention on Remand Act provides, in so far as relevant, as follows:

The Internal Regulations for Remand Prisons, introduced by Decree no. 148 of the Ministry of Justice of 12 May 2000, in the part entitled ‘Receiving and sending by the suspects and accused of telegrams, letters and money transfers’, contain sections 84 and 86, which provide that correspondence of the detainees is subject to perusal, and that all letters must be submitted to the remand prison staff member in a non-closed envelope. As a rule, the administration must forward letters to the addressee within three days of their receipt from the detainee. However, there are exceptions to this rule — section 91 provides as follows:

Pursuant to section 99 of the Internal Regulations, ‘proposals, declarations and complaints [of a detainee] addressed … to the defence lawyer, shall be considered by the administration of the remand prison and dispatched to the addressee within three days’. Pursuant to section 103, ‘replies to the proposals, declarations and complaints received in the remand prison must be read out to [the detainee] … and attached to their personal file’.

Section 27 of the Internal Regulations of 2000 reads as follows:

The Internal Regulations for Remand Prisons, introduced by Decree no. 189 of the Ministry of Justice of 14 October 2005 (which replaced Decree no. 148), contains section 146, which establishes that lawyers cannot use computers, audio- and video-recording equipment, copying machines, etc., during meetings with their clients in remand prisons unless authorised by the prison administration. On 31 October 2007 the Supreme Court of the Russian Federation struck down that provision as unlawful (decision confirmed on 29 January 2008).

On 29 November 2010 the Constitutional Court of the Russian Federation interpreted the above provisions of the Detention on Remand Act in their constitutional meaning. The Constitutional Court held that the law may legitimately introduce certain limitations on lawyer-client confidentiality, including perusal of their correspondence. However, such limitations should not be arbitrary, should pursue a legitimate aim and should be proportionate to it. Legitimate aims may include preventing further criminal activity by the accused and preventing him from exerting pressure on witnesses or otherwise obstructing justice. The general rule is that lawyer-client correspondence is privileged and cannot be perused. Any departure from this rule is permissible only in exceptional circumstances where the authorities have valid reasons to believe that the lawyer and/or his client are abusing the confidentiality rule. Further, the Constitutional Court specified that the prison authorities should have ‘sufficient and reasonable grounds to believe’ that the correspondence contains unlawful content and that they may peruse such correspondence only in the presence of the persons concerned and on the basis of a written motivated decision. The results of the inspection of the mail should also be recorded. At the same time the Constitutional Court ruled that any correspondence addressed by a detainee to his lawyer but not submitted ‘through the prison administration’, as provided by the federal law, may be checked by the prison administration.

Article 19.12 of the Code of Administrative Offences defines liability for passing to the detainees of prohibited ‘objects, substances or foodstuff’. Article 27.1 of the Code provides, in so far as relevant, that in order to suppress an administrative offence government officials who have the power to do so may conduct ‘inspections’ of the person and/or of the personal belongings and seize objects and documents. Article 27.10 regulates the procedure for the seizure of objects and documents. It provides that seizure of objects which are tools or an object of an administrative offence or documents which may have relevance for the administrative case, which are discovered at the place where the administrative offence was committed or which are kept by the person whose person or personal belongings are inspected, may be performed by a staff member of the remand prison in presence of two attesting witnesses.

Section 8 (2) of the Advocacy and Bar Act of 2002 (Federal Law of 31 May 2002, No. 63-FZ, the ‘Advocacy Act’) provides that a lawyer cannot be questioned as a witness on account of information which he had learned when a prospective client solicited his professional services or in the course of rendering such services. Section 8 (3) provides that a search in the premises occupied by an advocate for professional use must be authorised by a court order. Any information obtained as a result of the search may be used in criminal proceedings under condition that this information did not make part of the lawyer's case file [proizvodstvo] in a particular client's case (‘except tools of crime and objects not allowed for free circulation under Russian law’). Section 18 prohibits seeking from advocates any information related to the legal assistance they render in a specific case.

On 8 November 2005 the Constitutional Court issued ruling No. 439-O which gave constitutional interpretation to Articles 7, 29, and 182 of the CCrP, read in conjunction with Section 8 (3) of the Advocacy and Bar Act. It ruled, in particular, that the Advocacy and Bar Act is a lex specialis and must therefore take precedence over the general rules of authorisation of searches insofar as searches in the lawyer's offices are concerned. In particular, the Constitutional Court ruled that the applicable legislation in its constitutional meaning ‘does not allow searches to be conducted on the business premises of a lawyer or lawyers' entity without a special court decision in this respect’.

Article 74 of the CCrP contains a closed list of sources of information which can be used as evidence in criminal trial. That list mentions inter alia expert reports and expert testimony, as well as ‘other documents’ (Article 74 (2) (6)). Article 84 (1) of the CCrP provides that ‘other documents’ can be admitted as evidence if they contain information which may be important for establishing the facts which need to be established within the criminal proceedings.

The CCrP (Articles 57 and 58) distinguishes between two types of expert witnesses: ‘experts’ proprio sensu [experty] and ‘specialists’ [spetsialisty]. Their role in the proceedings is sometimes similar, albeit not absolutely identical. Whereas the ‘experts’ are often engaged in making complex forensic examinations prior to the trial (for example, dactyloscopic examinations, or post-mortem examinations of corpses), a ‘specialist’ is summoned to help the prosecution or court in handling technical equipment, examining an item of material evidence, understanding the results of ‘expert examinations’, assessing the methods employed by the ‘experts’, their qualifications, etc. Both can produce their reports to the court and/or testify in person. Under Article 57 of the CCrP (with further references) the right to commission an expert examination belongs to the investigator or to the trial court. The court may commission an expert examination at its own initiative or on the request of the parties.

Article 58 (1) of the CCrP defines the functions of a ‘specialist’ (in so far as relevant to the present case) as follows:

Article 58 (2) of the CCrP stipulates the rights that the specialist has in the proceedings, as well as his or her obligations. It refers to Articles 168 and 270 of the Code which deal with summoning the specialist and the procedure for his participation in the criminal proceedings. Article 164 deals with participation of the specialist in investigative actions at the pre-trial investigation stage at the request of the investigator. Article 270 provides that the presiding judge at the trial should explain to the specialist his or her rights and responsibilities before questioning.

The Plenary Supreme Court of the Russian Federation in its Ruling no. 8 of 4 July 1997 ‘On certain aspects of the application of penal law on tax evasion by the courts of the Russian Federation’ held inter alia as follows:

Under Article 75 of the CCrP, evidence obtained in breach of the provisions of the Code, are inadmissible. By virtue of Article 50 (2) of the Russian Constitution, in the administration of justice evidence obtained in violation of the federal law shall not be used.

Article 252 of the CCrP stipulates that the trial proceedings must concern only the accused person and must be limited to the accusations which have been formulated against him. Changing the scope of the accusation is possible to the extent that it does not worsen his situation and does not impair the rights of the defence.

Article 286 of the CCrP provides that the court may attach to the materials of the case-file documents produced by the parties.

The old CCrP (in force before 2002) provided that the duty to obtain evidence fell to the investigative bodies. The new CCrP (applicable to the case) recognises the defences' right to collect evidence, albeit with important limitations. Thus, Article 53 (2) of the Code provides that the defence lawyer has a right ‘to collect and submit evidence necessary for providing legal assistance, in accordance with Article 86 (3) of the Code’. Amongst other powers of the defence lawyer Article 56 (3) mentions ‘engaging a specialist in accordance with Article 58 of the Code’. However, it does not allow the defence to commission and produce ‘expert reports’.

Article 86 of the new CCrP formulates the rules on collecting evidence as follows:

The defence lawyer's right to obtain expert evidence is defined in Section 6 (4) (3) of the Federal Law No. 63-FZ ‘On Advocacy’ of 2002:

Article 271 (4) of the CCrP stipulates that the court cannot refuse to hear a witness or a ‘specialist’ who arrived at the court at the request of one of the parties.

Article 281 of the CCrP (‘Reading-out of the testimony of the victim and of the witness) reads, in so far as relevant, as follows:

For the relevant provisions of the Russian law concerning detention on remand under the Criminal Procedure Code, see Khodorkovskiy (no. 1), §§ 86 et seq.

Article 40 (1) of the Tax Code requires that parties trade at market prices. It also establishes a refutable presumption that the prices agreed to by the parties correspond to market levels and are used for taxation purposes. Under Article 40 (2) of the Tax Code, the tax authorities are empowered to overrule the above presumption by verifying and correcting the prices for taxation purposes. A finding that the prices were lowered usually leads to the conclusion that the taxpayer understated the taxable base and thus failed properly to pay his taxes. This may happen in a number of cases, in particular when the parties are interdependent.

Under Article 45 (2) 3 of the Tax Code the power to re-characterise transactions by a taxpayer with third parties, their legal status and the nature of the taxpayer's activity in tax disputes lies with the courts (as opposed to executive bodies). Section 7 of Law No. 943-1 of 21 March 1991 ‘On Tax Authorities in the Russian Federation’ vests the power to contest transactions as void and recover everything received in such transactions with the State budget.

Under Article 11 of the Tax Code, the institutions, notions and terms of the civil legislation of Russia used in the Tax Code keep their respective meanings, unless specifically stated.

Under Article 153 of the Civil Code, transactions are defined as activities of natural and legal persons creating, altering and terminating their civil rights and obligations. Article 10 (1 and 2) of the Code states that parties involved in civil-law transactions are prohibited from abusing their rights. In such cases, the courts may deny legal protection in respect of the right which is being abused. Article 10 (3) establishes a refutable presumption of good faith and reasonableness of actions on the parties in civil-law transactions.

Article 166 of the Civil Code states that a transaction may be declared invalid on the grounds established by that Code, either by force of its being recognized as such by the court (a voidable transaction), or regardless of such recognition (a void transaction).

Under Article 167 of the Civil Code, void transactions entail no legal consequences, apart from those relating to their invalidity, and are invalid from the moment they are conducted.

Article 170 (2) establishes specific rules in respect of two types of void transactions: ‘imaginary’ transactions (effected only for form's sake, without the intention to create the corresponding legal consequences) and ‘sham’ transactions (effected for the purpose of screening other transactions). This provision condemns both imaginary and sham transactions as void.

It also provides that in the event of sham transactions, the rules governing the transaction that was in fact intended by the parties may be applied by a court, regard being had to the substance of this transaction (the so-called ‘substance over form’ rule).

By a decision dated 15 May 1997 in the case of the Tax Service v. Commercial Bank Mechel-Bank and OAO Mechel (no. F09-162/97-AK), the Federal Commercial Court of the Ural Circuit quashed the decisions of lower courts in which they had upheld the lawfulness of a ‘kickback’ contract which had been concluded between the respondent bank and the respondent company. The Circuit Court ruled that the lower courts had failed to study and to take account of all of the circumstances relevant to the case at issue. In particular, the court noted the finding that the contract had been concluded specifically to avoid the payment of taxes. Accordingly, it reversed and invalidated the contract as unlawful, contrary to the legal order and morality, and ordered that the proceeds derived by the parties from the contract be seized in favour of the State.

In a decision of 9 December 1997 in case no. 5246/97, the Presidium of the Supreme Commercial Court of Russia invalidated a loan secured by a promissory note and a related pay-off agreement as imaginary and sham respectively. The court had regard to the terms of contracts concluded between the parties and the manner of their execution, in particular the fact that the loan had never been used by the borrower; it concluded that the transactions in question covered the sale of a promissory note and invalidated them as sham.

In a decision of 6 October 1998 in case no. 6202/97 the Presidium of the Supreme Commercial Court of Russia invalidated two contracts for the sale of securities and a related loan agreement as sham, having regard to the terms of contracts in question, the manner of their execution and the contractual prices. The court established that the sales contracts in fact covered the loan agreement secured by the pledge of securities and remitted the case for re-trial.

The case of Tax Service v. OOO TF Grin Haus (no. A40-31714/97-2-312) concerned a series of intertwined transactions (rent contracts and loan agreements) between the respondent entity and two third parties: as a result, the respondent leased a building in central Moscow to the third parties, but was able to avoid inclusion of the rent payments in the taxable base of its operations by claiming that they were interest payments in respect of the loan agreement. The Tax Service discovered the tax-evasion scheme, re-characterised the transactions in question as rent and ordered the taxpayer to pay RUB 2 billion in back taxes. The case was examined in three rounds of court proceedings by the courts at three levels of jurisdiction. Having regard to the substance of the transactions entered into by the respondent, the terms of payment and execution of the contested contracts, and, generally, to the conduct of the respondent company and the third parties, the courts decided that the contractual arrangement had been sham, re-characterised the arrangement as rent and upheld the decision of the Tax Service. In the first round of proceedings the courts adopted their decisions on the following dates: 1 December 1997, 27 January 1998 and 30 March 1998. In the second round of proceedings the decisions were adopted by the first-instance and appeal courts on 26 May 1998 and 21 July 1998. The decision of the cassation court was taken on an unspecified date. The third round of proceedings involved decisions on 17 November 1998, 25 January 1999 and 2 March 1999.

In its decision no. 24-P dated 12 October 1998, the Constitutional Court of Russia for the first time made use and interpreted the notion of ‘bad/good faith’ to assess the legal consequence of the conduct of taxpayers in its jurisprudence. In this case this was done to define the moment at which a taxpayer can be said to have discharged his or her constitutional obligation to pay taxes.

In its decision no. 138-O dated 25 July 2001, the Constitutional Court of Russia confirmed that there existed a refutable presumption that the taxpayer was acting in good faith and that a finding that a taxpayer had acted in bad faith could have unfavourable legal consequences for the taxpayer. The case again concerned the definition of a moment at which a taxpayer can be said to have discharged his or her constitutional obligation to pay taxes.

Starting from 2002 the concept of a ‘bad-faith taxpayer’ regularly appeared in the case-law of the North-Caucasian District Commercial Court (see the Yukos judgment, §§ 361 et seq.).

Articles 198 and 199 of the Criminal Code define tax evasion. In 1999–2003 those provisions, insofar as relevant, read as follows:

Article 198. Evasion by a Natural Person of Paying Taxes or Contributions …

Article 199. Evading Payment of Taxes and (or) Contributions … Collectible from Organizations

In December 2009 Article 199 was supplemented with footnote no. 2, which reads as follows:

A constitutional interpretation of Article 199 of the Criminal Code was given by the Constitutional Court of Russia in its Judgment no. 9-P of 27 May 2003. It concerned, in particular, interpretation of the concept of ‘other means’ used in Article 199 of the Criminal Code. The plaintiffs in that case considered that the concept of ‘other means’ was too vague, might lead to arbitrary interpretation and was therefore unconstitutional. In particular, Mr T., one of the plaintiffs, was a director of a firm which had an outstanding tax debt. Instead of paying that debt he spent the money of his firm for other purposes. Such behaviour was considered as tax evasion ‘by other means’ and Mr T. was convicted. The Constitutional Court held that ‘taxes … can be considered as lawfully established only where the law defines clearly the object of taxation, the taxable amounts, the amounts of tax payments, category of taxpayers [concerned] and other substantive elements of a fiscal obligation’. It continued as follows:

The Constitutional Court also stressed that the key element in the disposition of Article 199 was the deliberate character of the tax evasion, i.e. the existence of the intent of the tax-payer to avoid paying taxes. It held that the law does not criminalise non-payment of taxes which results from inadvertence or from the lawful use of legal tools reducing tax burden (point 4 of paragraph 5 of the Judgment).

On 27 May 2003 in Ruling no. 254-O the Constitutional Court held, in particular, that ‘… criminal liability may only arise if [non-payment of taxes] is committed deliberately and is aimed directly by evasion of a lawfully established tax in violation of the tax law which should be established by a general jurisdiction court during examination of factual circumstances concerned’.

On 19 June 2003 the Constitutional Court adopted Judgment No. 11-P, where it held inter alia as follows:

On 8 December 2003 the Criminal Code was amended. The new law excluded from Article 198 the reference to ‘other means’ of tax evasion, but added that tax evasion may take a form of submission of knowingly false data in the tax declaration as well as in ‘other documents’ which must be produced to the tax authorities for fiscal purposes. A similar amendment was made to Article 199 of the Code. Furthermore, the Criminal Code from that time forth penalised only tax evasion on a particularly large scale.

The Plenary Supreme Court of the Russian Federation in its Ruling no. 64 of 28 December 2006 (points 2 and p. 9) indicated inter alia that tax evasion included deliberate submission to the tax authorities of false information on the taxpayers' income, yield, property, eligibility to tax cuts etc. in the tax declaration or in other documents which a taxpayer must produce to the tax authorities. The Ruling also described situations where one person de facto pursued business activities through another person, a front man (podstavnoye litso), in order to evade taxes (point 6). The Supreme Court also noted that the courts can commission expert examinations and invite experts to participate in the trial in the tax evasion cases (point 23).

For the relevant legislation concerning taxation in the low-tax zones (ZATOs) and applicable case-law see the case of Yukos, §§ 307 et seq., cited above; see in particular §§ 354–357, and §§ 384–399.

On 14 October 1999 the Urals District Commercial Court, sitting as a court of cassation, adopted a ruling in the case of OOO Chelpiks v. Tax Inspectorate for the Sovetskiy District of Chelyabinsk (case no. F09-864.99-AК). It concerned the operation of a company (Chelpiks) registered on the territory of ZATO of the Snezhinsk town and operating there on the basis of a preferential taxation agreement concluded with the town administration. The Tax Inspectorate required that the company paid taxes in full. They argued that given the ‘de facto location of the company’ preferential taxation agreement was not valid. The court of cassation disagreed. It observed that the company was lawfully registered on the territory of ZATO and that the preferential taxation agreement was not declared null; in such circumstances the court held that the company was entitled to tax cuts.

On 3 April 2001 the same court examined the case of Tax Ministry (Tax Inspectorate for the Central District of the Ozersk town) v. ZAO Energosintez. The latter company was registred in the ZATO of the town of Ozersk and operated on the basis of a preferential taxation agreement concluded with the town administration. The court of cassation noted that under the ZATO Act, in order to be eligible to tax cuts, the company should have at least 90 per cent of its assets and carry out at least 70 per cent of its business activities on the territory of the ZATO at issue; in addition, 70 per cent of the average number of personnel on payroll should be from ZATO, while at least 70 per cent of wage should be paid to workers who are permanent residents of ZATO. The court found that 70 per cent of the average number of staff in the company were ZATO residents and that they received more than 70 per cent of wages paid by the company. The central argument for the Tax Inspectorate was that the business activity of the defendant company (which consisted of processing and re-selling of oil-products) was not carried out on the territory of ZATO and that it was done by the industrial facilities which did not belong to the defendant company. The court however, rejected that argument as irrelevant and held that those factors did not affect eligibility of the defendant company to tax cuts.

On 27 December 2000 the Eastern Siberian District Federal Commercial Court examined the case of Tax Service (Tax Inspection of the Zheleznogorsk town) v. OOO Siblekon (cases nos. A33-6259/00-C3a-F02-2820/00-C1 and A33-6259/00-C3a-F02-2821/00-C1). In that case a company registered in the Zheleznogorsk town ZATO was brought to tax liability for the allegedly unlawful use of tax cuts obtained on the basis of a preferential tax agreement with the town administration. The court of cassation upheld the first instance court's judgment insofar as it ordered the defendant company to pay taxes in full. The court of cassation found that the preferential tax agreement had been concluded by the town administration in breach of the procedure prescribed by law and was therefore invalid. At the same time the court of cassation quashed the first-instance court's judgment in so far as it concerned recovering penalties from the defendant company, and upheld the decision of the court of appeal in this respect. It held in particular as follows:

On 5 June 2002 the North-Western District Commercial Court, sitting as a court of cassation, adopted a ruling in the case of the Tax Service (Inter-District Inspectorate No. 3 for the Murmansk Region) v. OOO Pribrezhnoe (case no. A42-6604/00-15-8-818/01). The case concerned tax cuts obtained by the defendant (OOO Pribrezhnoe) on the territory of the ZATO of the Snezhogorsk town, Murmansk Region, on the basis of a preferential tax agreement with the town administration. The tax authorities claimed that the tax cuts had been granted to the defendant (referred to in that Ruling as ‘the company’) unlawfully, and that it had not satisfy the requirements of the law on ZATOs. In 2000 the Tax Inspectorate took a decision bringing the company to tax liability for unlawfully obtained tax cuts. That decision was upheld by the courts at two levels of jurisdiction. However, the North-Western District Commercial Court (sitting as a court of cassation) quashed the lower court's decisions and the decision of the tax inspectorate of 2000. The court of cassation held, in particular, as follows:

Further, the court of cassation indicated that the Tax Inspectorate collected evidence against the company in the course of ‘on-the-site’ tax audits of the contractors of the company, and following an ‘examination of the premises’. At the same time, the decision of the Tax Inspectorate of 2000 indicates that the company was brought to tax liability following a ‘desk’ tax audit — i.e. solely on the basis of documents submitted by the taxpayer. The documents submitted by the company to the Tax Inspectorate demonstrated that the company satisfied all requirements of section 5 (1) of the Law on ZATOs. The Tax Inspectorate, within a ‘desk’ tax audit, was not empowered to visit premises of the company. Although after the decision bringing the company to tax liability the Tax Inspectorate conducted an ‘on-the-site’ tax audit of the company, its results cannot be used to support the conclusions of the decision of 2000. The court of cassation also held that it was wrong to shift on the company the burden of proof that it had indeed carried out its business activities on the territory of ZATO. Although it was possible to request the taxpayer to submit additional documents, in the case at hand it had been done simultaneously with rendering the decision on bringing the company to tax liability. The court also noted that the eligibility of the company to tax cuts was confirmed by the official letters of the Ministry of Taxes and the Ministry of Finances.

For the more recent case-law on tax cuts in the low-tax zones see §§ 429–458 of the Yukos judgment.

Preferential taxation for small business was introduced by the Federal Law ‘On Simplified Taxation, Accounting and Reporting for Small Businesses’ (No. FZ-222, 29 December 1995, the ‘Small Business Act’). It introduced inter alia a ‘patent’ system for self-employed businessmen, who, instead of paying a variety of different taxes and submitting complex tax declarations, were only required to buy every year a ‘patent’ (licence) for a particular type of activity, provided that their yearly proceeds do not exceed a particular amount (100,000 times the statutory minimum wage). The price of the licence thus constituted a nominal annual advance tax payment (calculated as a multiple of the State defined minimum wage), and exempted the entrepreneur from further taxation (including state insurance premiums) in respect of the licensed activity income. Under Article 1 of the Act, the businessmen eligible for the ‘licence system’ were free to choose it or to remain within the ‘traditional’ taxation framework. A separate licence was required for each category of services specified in the Small Business Act.

On 2 October 2002 the Federal Commercial Court for Eastern-Siberian District, sitting as a court of cassation, rendered a decision in the case of Tax Service (Angarsk Inspectorate) v. Vliran Ltd (case No. A19-884/02-24-F02-2873/02C1). That case concerned a service agreement concluded between Mr K. and the taxpayer — Vliran Ltd. Under that agreement Mr K. was supposed to work as a general manager of the taxpayer company, in exchange of a fee. Mr K. was registered as an individual entrepreneur; at the same time he was the sole owner of the Vliran Ltd (i.e. the taxpayer company). As a result, the service agreement had his signatures on behalf of both sides: he signed it in the capacity of an individual entrepreneur and in the capacity of the sole owner of the company. The fees paid by the company to Mr K. were included in its declaration as ‘costs’. The Tax Inspectorate considered that these fees could not be regarded as ‘costs’ on the ground that the service agreement between the company and Mr K. was null, since it was signed by the same person on both sides. The court of cassation, however, ruled in favour of the taxpayer company. It held, in particular, that the charter of the company did not provide for the position of a general director, and that his functions could therefore be transferred to an external person. Furthermore, there was nothing in the law to prevent the company from ‘outsourcing’ the managerial function to somebody else. The court ruled that there was no evidence that the company acted in bad faith, and the service contract was therefore valid.

As a general rule (Article 56 § 1 of the Civil Code of 1994) civil liability of a company before its creditors is limited by the amount of its assets. At the same time, § 2 provides that where the insolvency of a legal person is caused by its owners or by other persons who ‘have the power to give binding orders to that legal person or are capable of controlling its activities otherwise’, those persons, in case the assets of the legal person are insufficient to satisfy the creditors' claims, bear subsidiary liability for its debts.

A person who suffered pecuniary or non-pecuniary damage as a result of a crime may introduce a civil claim against the alleged perpetrator within the criminal proceedings against him (Article 44 § 2 of the new Criminal Procedure Code of 2001; Article 29 of the old Criminal Procedure Code). The criminal procedure law distinguishes between the figures of the victim of the crime and of the ‘civil plaintiff’ (i.e. the person whose pecuniary interest had been affected by the crime): they are not necessarily the same person. Similarly, the criminal defendant (the suspect or the accused person) is not necessarily the same person as the ‘civil defendant’. The latter is defined in Article 54 of the new Criminal Procedure Code as ‘a legal person or an individual, who, under the Civil Code of the Russian Federation, bears [civil] liability for the damage caused by the crime [committed by the criminal defendant]’.

The Criminal Procedure Code does not define what provision of the Civil Code a civil plaintiff may rely upon in lodging a civil claim. By default, a civil plaintiff has to rely on the general rule of tort, that is on Article 1064 § 1 of the Civil Code, which provides that ‘damage caused to the property or to the person of an individual, or damage caused to the property of a legal person, must be compensated in full by the tortfeasor’. As a general rule, liability for tort is conditioned upon the fault of the tortfeasor; however, in some cases the law may provide for strict liability. The last paragraph of that provision stipulates that where the victim of the tort has asked for the damage to be caused, or has agreed to it, no liability for tort arises. In addition, Article 1068 of the Civil Code provides for liability of a legal person for the damage caused by an employee of that legal person. Insofar as relevant it reads as follows:

Article 108 of the Tax Codes speaks of liability for violations of tax law. Under § 4 of that provision, ‘bringing a company to tax liability does not exclude … bringing its managers to administrative, criminal or other liability provided for by the law’. Article 110 of the Tax Codes defines different types of fault (‘vina’ — the same word used for describing guilt in the criminal law context) for qualifying an act as a tax offence. A person (a legal person or a company) is guilty of a tax offence if it committed the imputed act knowingly or by negligence (§ 1). Article 110 § 4 of the Tax Code reads as follows:

On 4 July 1997 the Plenary Supreme Court issued Decree No. 8 in which it interpreted some provisions of material and procedural law related to the application of provisions of the Criminal Code on tax evasion (Articles 198 and 199). It held, in particular, as follows:

The term ‘vinovniy’ used by the Plenary Supreme Court is quite large. In a criminal-law context it is a criminal offender, a person guilty of a crime. In the civil law it refers to a civil fault and may be translated (depending on a context) as ‘defaulter’, ‘liable person’, ‘tortfeasor’, etc. In the tax-law context it refers to a taxpayer (a legal person or an individual) at fault, the one who is culpable of not paying taxes, or is culpable of other tax offences.

On 11 January 2001 the Supreme Court of the Russian Federation quashed the lower courts' judgments in the case of the Tax Ministry (North-East District Tax Inspectorate in Moscow) v. I. and K. Those individuals were executive officers of a limited company ‘Taros’. In 1999 they were convicted by the Ostankinskiy District Court of Moscow for company tax evasion (under Article 199 of the Criminal Code), for having submitted false information in the tax declaration submitted on behalf of the ‘Taros Corporation’ company. The criminal judgment ordered, in particular, the reimbursement of damages to the State in the amount of unpaid company taxes (company income tax, VAT, etc.). Having analysed that particular issue, the Supreme Court held as follows:

On 28 December 2006 the Plenary Supreme Court issued a new Decree on the application of provisions of the Criminal Code on tax evasion (Decree no. 64) which replaced decree no. 8. In that decree the Plenary Supreme Court held, in particular, as follows:

In the following years that ruling was repeatedly interpreted by the Russian courts as not allowing the ‘piercing of the corporate veil’ and recovering company taxes from the managers of the company found guilty of tax evasion under Article 199 of the Criminal Code (see the Ruling of the Omsk Regional Court of 4 June 2009, no. 22-1873 in the case of B.; Ruling of the Perm Regional Court of 28 May 2012, no. 33-3769 in the case of Popovtsev; see also the Decree of the Presidium of the Chelyabinsk Regional Court of 7 September 2011 ‘On the analysis of the judicial practice in the Chelyabinsk Region on examination of civil claims within criminal proceedings’, point 3.2.3 (b)).

According to the Government, Russian law provided that conditions of detention on remand must be compatible with human dignity and presumption of innocence. Detention on remand was possible only on the basis of a court order. Criminal prosecution of a suspect inherently entailed limitations of his or her Convention rights which would not be permissible in other situations. One of those limitations concerned the possibility of detaining the suspect; this was done in order to help the State authorities maintain public order and prevent further crimes.

The Government informed the Court that sanitary treatment and disinfestation of cells in the remand prison had been entrusted to a private subcontractor. They produced copies of service agreements with the subcontractors and certificates of completed work. The cells were examined on a daily basis by the prison medical staff. The cells were treated with special chemical substances every month. In addition, the inmates are required to clean the cells on a daily basis. The sanitary conditions in the cells were inspected by experts from the Moscow Centre of State Sanitary-Epidemic Surveillance and the Centre of Hygiene and Epidemiology, part of the penitentiary system. Heads of regional penitentiary departments and particular penitentiary institutions were responsible for maintaining hygiene standards in the places of detention which would be compatible with the requirements of the Convention.

In accordance with the Detention on Remand Act and the prison regulations, the second applicant had a right to one sixty-minute walk per day in one of the remand prison's courtyards. On hearing days the applicant was ‘placed under the orders’ of the escort squad which secured his transfer to the court building and his return to the remand prison. On those days the applicant was able to take walks provided that he was back in the prison before sunset. On hearing days the applicant was given a ‘dry lunch’, which corresponded to the three-course meal which he would otherwise have received in the remand prison, in accordance with the norms established for prison food by the Ministry of Justice. In the courtroom the applicant was given hot water to prepare instant food and make coffee or tea. He was also afforded sufficient time to prepare food and eat. However, the applicant refused to accept the dry food provided by the remand prison. In addition, the applicant had been entitled to take with him food which he had received from his relatives and which was allowed by the prison administration and food from the prison food shop.

The second applicant complained about two specific aspects of his detention. First, he complained about the conditions in the isolation cell were he had been detained between 18 and 25 August 2005. In his words, conditions there were degrading. The reason for his placement in the isolation cell was the fact that he had complained to the Prosecutor General about the actions of Mr Tagiev, the director of the remand prison. Thus, Mr Tagiev, who had submitted the information about the conditions in the isolation cell, definitely had an interest in providing an untrue account. The applicant believed that the documents appended to the Government's memorandum had been drawn up by persons who were not disinterested. Throughout the entire period of his detention in the isolation cell and in the other cells, there had been no independent examinations of the sanitary and hygiene conditions. The applicant's lawyers were not permitted to see him in the various cells in which he was kept.

The second applicant further complained that on the days of court sessions, which had taken place almost every day for more than a year, he had been deprived of hot food and outside walks. The Government's reference to dry ‘travel rations’‘ that were offered to the applicant on trial days meant that they accepted that he had not been provided with hot food. During the trial the applicant was not able to undertake any physical exercise. The Government's indication that the applicant ‘had an opportunity to undertake daily outdoor exercise for no less than one hour in daylight time’ made it clear that such an exercise regime was necessarily unavailable on court days.

The Court reiterates that in order for a punishment or treatment associated with it to be ‘inhuman’ or ‘degrading’ within the meaning of Article 3, the suffering or humiliation involved must in any event go beyond that inevitable element of suffering or humiliation connected with a given form of legitimate punishment or treatment, such as, for example, deprivation of liberty (see, among other authorities, V. v. the United Kingdom [GC], no. 24888/94, § 71, ECHR 1999-IX; Indelicato v. Italy, no. 31143/96, § 32, 18 October 2001; Lorsé and Others v. the Netherlands, no. 52750/99, § 62, 4 February 2003; and Ilaşcu and Others v. Moldova and Russia [GC], no. 48787/99, § 428, ECHR 2004-VII).

In assessing whether the treatment inflicted on a prisoner went beyond the ‘inevitable element of suffering or humiliation’ associated with the deprivation of liberty, the Court often took into account the cumulative effect of various aspects of prison life (Dougoz v. Greece, no. 40907/98, § 46, ECHR 2001-II). In previous cases the Court analysed such factors as access to natural light or air in the cells, adequacy of heating arrangements, compliance with basic sanitary requirements, the opportunity to use the toilet in private and the availability of ventilation (see, for example, Peers v. Greece, no. 28524/95, §§ 70–72, ECHR 2001-III; Babushkin v. Russia, no. 67253/01, § 44, 18 October 2007; and Vlasov v. Russia, no. 78146/01, § 84, 12 June 2008). That list is not exhaustive; other conditions of detention may lead the Court to the conclusion that the acceptable threshold of suffering or degradation has been exceeded and the applicant was subjected to ‘inhuman or degrading treatment’ (see, for example, Fedotov v. Russia, no. 5140/02, § 68, 25 October 2005; Trepashkin v. Russia, no. 36898/03, § 94, 19 July 2007; and Slyusarev v. Russia, no. 60333/00, § 36, ECHR 2010-…). The length of the period during which a person is detained in the particular conditions also has to be considered (see, among other authorities, Alver v. Estonia, no. 64812/01, 8 November 2005).

The Court also reiterates that in the case of Ramirez Sanchez v. France [GC] (no. 59450/00, § 119, ECHR 2006-IX) it stressed that ‘the measures taken [in respect of a detainee] must also be necessary to attain the legitimate aim pursued’. In that case the applicant, who was detained in isolation for many years, was considered to be one of the most dangerous terrorists of his time. The Court had to assess whether, in view of the danger he represented, ‘the measures taken [i.e. isolation] were necessary and proportionate compared to the available alternatives’ (§ 136). In Ensslin, Baader and Raspe v. Germany (nos. 7572/76, 7586/76 and 7587/76, Commission decision of 8 July 1978, Decisions and Reports (DR) 14, p. 64), the Commission stressed that ‘in assessing whether [isolation] may fall within the ambit of Article 3 of the Convention in a given case, regard must be had to the particular conditions, the stringency of the measure, its duration, the objective pursued and its effects on the person concerned’.

Insofar as the second applicant can be understood as complaining about conditions in the ordinary cell where he was detained most of the time, the Court observes that he did not develop this complaint in sufficient detail and did not submit information or documents that would persuade the Court that conditions there were indeed ‘inhuman and degrading’. The Court concludes that Article 3 was not breached on this account.

The second applicant also complained about his placement in the isolation cell between 18 and 25 August 2005, as well as about sanitary conditions there and regime restrictions during his isolation.

The Court observes, first of all, that at the relevant time the second applicant's conviction has not yet been confirmed by the court of appeal. Therefore, in domestic terms he was still detained on remand. In a number of previous cases the Court stressed that ‘prolonged solitary confinement is undesirable, especially where the person is detained on remand’ (see Ramirez Sanchez, cited above, § 120 with further references).

Secondly, the Court notes that the solitary confinement was imposed on the applicant for his alleged refusal to go for a walk. Some of the submitted documents mentioned that the applicant had refused to go to the shower (see paragraph 57 above). Whatever the real reason for imposing a disciplinary sanction, the Court considers that the applicant's fault, if any, was not particularly serious and did not probably call for such a measure (see in this respect the CPT's recommendation that such a serious punishment as solitary confinement should be commensurable to the disciplinary offence for which it was imposed, paragraph 455 above). The Court reiterates that although it is not for the Court to specify which security measures may be applied to prisoners, ‘the absence of any substantive reasons’ for placing a detainee in a solitary confinement cell for a considerable period of time can be a relevant factor for characterising this form of disciplinary punishment as ‘inhuman and degrading treatment’ (see Babar Ahmad and Others v. the United Kingdom, nos. 24027/07, 11949/08, 36742/08, 66911/09 and 67354/09, § 211, 10 April 2012; see also Razvyazkin, cited above, § 107).

Thirdly, the Court reiterates that solitary confinement is one of the most serious measures which can be imposed within a prison. Bearing in mind the gravity of the measure, the domestic authorities are under an obligation to assess all relevant factors in an inmate's case before placing him in solitary confinement (see Ramishvili and Kokhreidze v. Georgia, no. 1704/06, § 83, 27 January 2009; Onoufriou v. Cyprus, no. 24407/04, § 71, 7 January 2010; and A.B. v. Russia, no. 1439/06, § 104, 14 October 2010).

That being said, the Court does not consider that the solitary confinement by itself was contrary to Article 3 (see Messina v. Italy (no. 2) (dec.), no. 25498/94, ECHR 1999-V, quoted with approval by the Grand Chamber in Ramirez Sanchez, cited above, § 12; Öcalan v. Turkey [GC], no. 46221/99, § 191, ECHR 2005-IV). The Court must examine whether other limitations and hardships associated with this disciplinary sanction brought the whole situation within the ambit of Article 3.

Some elements in the applicant's account of the conditions in the isolation cell are not disputed by the Government. In particular, the Court takes it as accepted that the cell had a window measuring 90 × 60 cm. It is questionable whether such a window would provide enough natural light for a cell measuring 5.5 square metres. The permanent electric light in the cell may have been very disturbing for a detainee, and the one-metre distance between the open toilet pan and the sleeping place was clearly insufficient. Furthermore, the applicant had been deprived of all social contacts, could not read books or magazines or watch TV (see paragraph 452 above), and could not lie down on the bunk-bed, since it was unfolded only between 10 p.m. and 6 a.m.

Other factual assertions by the applicant concerning the conditions in the isolation cell (poor sanitary condition of the cell, no hot food or walks) are disputed by the Government. However, the Court is not required to resolve this factual controversy on those points. Even if the applicant's description of the other conditions of detention was accurate, and even if such conditions might indeed be very uncomfortable, it is crucial to note that the situation complained of lasted for only seven days (cf. with Popandopulo v. Russia, no. 4512/09, § 95, 10 May 2011, or A.B. v. Russia, cited above, §§ 105 et seq., where the applicants' solitary confinment lasted much longer). The Court concludes that in the circumstances of the present case the degree of suffering to which the applicant was exposed, given its short duration and in view of the applicant's age and mental and physical condition, did not reach the minimal threshold of severity to amount to ‘inhuman or degrading’ treatment. Consequently, there was no violation of Article 3 on this account.

Finally, the second applicant complained about the alleged lack of hot food and walks on the days of court hearings.

As regards the unavailability of hot food on court days, the Court notes that the Government produced a document, written by the applicant himself, whereby he refused to receive dry meals because he had his own food (see paragraph 60 above). As follows from the Government's explanations, the detainees were allowed to use a kettle in the premises of the Meshchanskiy District Court. It was therefore possible for the applicant to prepare tea, coffee or instant food during the day. Such arrangements, in the absence of any particular medical counter-indications, and where a detainee can afford to buy his own food in sufficient quantities, do not raise any issue under Article 3 of the Convention.

The Court will now turn to the alleged lack of physical exercise. The Court has frequently found that a short duration of outdoor exercise, limited to one hour a day, was a factor that further exacerbated the situation of applicants who were confined to their cells for the rest of the time without any kind of freedom of movement (see Skachkov v. Russia, no. 25432/05, § 54, 7 October 2010; Gladkiy v. Russia, no. 3242/03, § 69, 21 December 2010; and Yevgeniy Alekseyenko v. Russia, no. 41833/04, § 88, 27 January 2011). The applicant in the present case claimed that for most of the time he had been deprived even of that short walk. The Government's responses in this respect indicate that walks had been available to detainees only if they left the remand prison some time after sunrise and returned there before sunset. The Court reiterates its factual findings in the case of Trepashkin v. Russia (no. 2) (no. 14248/05, § 119, 16 December 2010), which analysed the situation in the same remand prison in the following terms:

The Court notes that in 2004–2006 the applicant was taken to the Meshchanskiy District Court more than 160 times (see paragraph 60 above). There is no information as to the exact time that the applicant left the prison and when he was returned there on every particular date. In the circumstances the Court is prepared to assume that on most of the days when the applicant was taken to the court he could not take walks in the remand prison. Furthermore, it is unclear whether the second applicant was able to take advantage of that possibility (the first applicant had this opportunity — see the case of Khodorkovskiy (no.1), § 113).

That being said, the Court notes that in the present case the lack of physical exercise was not combined with other negative factors, such as, for instance, overcrowding in the cell or bad conditions of transportation to and from the court building (cf., mutatis mutandis, with Yevgeniy Alekseyenko, cited above, or Moiseyev v. Russia, no. 62936/00, §§ 124 et seq., 9 October 2008). Furthermore, the applicant was able to take walks on weekends and on those days when there were no hearings. On the whole, the Court is unable to conclude that the absence of the possibility for walks on the days of the court hearings amounted to a breach of Article 3 of the Convention.

Having regard to the above, the Court concludes that material conditions in the remand prison, complained of by the second applicant, did not amount to ‘inhuman and degrading treatment’ within the meaning of Article 3 of the Convention.

The Government submitted that security measures applied in the courtrooms were amongst many negative effects which were inherent in the very idea of criminal prosecution. At the time there was no other means of securing public order in the courtroom than placing the applicants in a metal cage. This security arrangement was a part of the standard design of courtrooms according to State building standards. The cage was 2.2 m high and surrounded the defendants' bench. The defendants' bench was intended to seat up to 20 people. In sum, there had been nothing exceptional in such a security measure.

During the court hearings the second applicant was obliged to spend long periods of time (up to nine hours a day) in the courtroom, confined within a very narrow iron cage where he was unable even to stretch his legs. Such security arrangements, which might exceptionally be warranted in the case of dangerous defendants, were wholly unjustified in the applicant's case. The applicant was charged with economic crimes and there was no reasonable basis for keeping him in a cage during the trial. He had never been convicted of any criminal offence prior to his trial. The second applicant was a very tall man (almost 2 metres in height), with long feet (size 47), and a history of knee surgery. The fact that he was kept in a cramped cage for extended periods of time, sometimes for almost the entire day, caused him physical suffering.

The applicants' co-defendant, Mr Kraynov, was not held in the iron cage. The second applicant was displayed in the iron cage and, as can be seen from photographs, he was televised and photographed by the media whilst in that cage. On arrival at the court he was surrounded by armed forces and handcuffed. The average observer could easily have believed that an extremely dangerous criminal was on trial. Such public exposure humiliated him and aroused in him feelings of inferiority. There was no real risk of the applicant absconding from the court, where he was under the supervision of numerous guards immediately beside the cage and a significant number of armed guards in the vicinity of the courthouse.

The Government claimed that the second applicant's continued detention had been based on ‘relevant and sufficient’ reasons. The Government asserted that when selecting a measure of restraint the courts took account of all legally relevant circumstances, as required by law. Under Article 97 of the CCrP detention on remand can be ordered if there is a risk of absconding, re-offending, or interfering with the course of justice. In deciding on the measure of restraint the court must take into account the gravity of the crime imputed to the accused, information about his character, age, health condition, family situation, occupation and other relevant factors.

In the Government's submissions, the applicant tried to ‘avoid meetings with the investigative authorities’ of the Russian Federation. Thus, on 27 June 2003 the applicant was summoned for questioning in the building of the General Prosecutor Office. The meeting was scheduled for 10 a.m. on 2 July 2003; however, ten minutes before the start of the interview the applicant's lawyer called the investigator to inform him that the applicant had been taken to hospital. According to a certificate from the Vishnevskiy Hospital, however, the applicant was admitted there at 12.56 p.m., and not at 9.50 a.m. as he had alleged. During his examination at 3.20 p.m. the doctors observed an improvement in his condition, describing it as ‘satisfactory’. The Government concluded that the applicant's hospitalisation had merely been a pretext for evading questioning.

Furthermore, on 2 July 2003, at the time of his arrest, the applicant threatened the investigator, in presence of several FSS officers, with criminal liability. He also threatened to begin a press campaign against the officials involved in his prosecution. At the time of his arrest the investigative authorities knew that the applicant had three passports for foreign travel and owned real-estate in foreign countries. Furthermore, they knew from unnamed sources that the applicant's lawyers had assured the applicant that he would be released on bail following a press campaign in his defence.

Some of the applicant's subordinates exerted pressure on the witnesses in order to impede the investigation. The Government produced a copy of an interview with a certain Ms Kar., made in 2008. According to Ms Kar., she worked for one of the companies which traded Yukos oil. In 2003 Yukos managers persuaded her to leave Russia for Cyprus and paid for her to stay there. In 2004 she returned to Russia and was arrested. The Government further noted that the applicant's accomplices had left Russia and did not intend to return. According to written testimony by Mr Glb., a Yukos manager, obtained in 2007, in 2003 the first applicant had met him and persuaded him to leave Russia. Later he had been told not to return to Russia. He understood that the Yukos security service had its personnel sent to London and considered that move as a personal threat to his security.

The Government concluded that the authorities had assessed the applicant's dangerousness, his personality, character, property, links to his home state and other relevant factors. The applicant had access to private jets at Vnukovo airport, and it would have been relatively easy for him to leave secretly the hospital where he had been admitted. He had access to foreign currency through ‘the plastic cards emitted by foreign banks’. The authorities had also relied on the applicant's position within the company. Given that most of the evidence and testimony in the case could have been obtained only from the company's staff, it had been important to keep the latter out of the applicant's reach.

All these reasons were directly set out in the court decisions extending the applicant's detention. The fact that they were repeated in the consecutive detention orders meant only that they continued to exist throughout the term of the applicant's detention. Not only did the reasons which were previously stated in the court's decision not cease to exist, new reasons appeared, which were also set out in the court decisions.

During court examination of issues related to the second applicant's detention on remand, his procedural rights had been fully respected. Thus, the defence was informed about the forthcoming hearings, and were able to prepare their arguments and lodge appeals. The length of the applicant's detention was due to the complexity of the case and the need to examine carefully the arguments of both parties. The defence lawyers protracted the period of detention by deliberately delaying the examination of the case-file. The investigation was closed on 22 August 2003, i.e. two months after the opening of the case; however, the defence finished examining the file only on 25 March 2004, i.e. seven months later. The applicant's health condition did not prevent him from studying the case; his intellectual level and professional skills were sufficient for understanding the evidence against him.

For the second applicant, the reasons given by the Russian courts responsible for extending his detention beyond July 2004 were always substantially the same as the previous reasons. Thus, the decisions by the Moscow courts had failed to address any of the points relevant to the applicant's continuing pre-trial detention. The Moscow courts had nowhere acknowledged the principle of the reduced likelihood of absconding the longer the pre-trial detention continued; had failed to identify precisely how the applicant would be able to interfere materially with witness evidence; had nowhere conducted the essential balancing exercise between the ongoing and prolonged deprivation of liberty against the risks involved. House arrest or other alternative measures of restraint had not been considered.

The allegation that the applicant had three valid international passports in his possession was refuted by the existence of two passports marked ‘annulled’, attached to his case file. The applicant had not transferred any money to credit cards issued by foreign banks in any manner that could have shed a negative light on his conduct. In addition, it had been established in the case file that the applicant kept most of his money in accounts with Russian banks, while using his foreign bank accounts in strict compliance with Licence no. 32-05-1190/97 of the Central Bank of the Russian Federation. The applicant had not had access to the company's private jets. In any event, owing to his status, the applicant could have used the services of any airline in the world. The issue of border crossing in any place should be under the authorities' control. The applicant could not be blamed for the ‘powerlessness’ demonstrated by the authorities as regards control over crossing of the State's borders.

The applicant had not been attempting to avoid meetings with investigative bodies and had been prepared to appear for questioning as a witness. The applicant had not been simulating his illnesses; his hospitalisation had been based on the results of an examination by the head of the Vishnevskiy Military Hospital.

The documents referred to by the Government had not been mentioned in the proceedings before the domestic courts, and the corresponding documents had not been produced before the latter. The Government's argument that the applicant might have bribed witnesses or coerced them into giving false testimony was unsubstantiated.

The Government failed to demonstrate why alternative preventive measures were not considered by the domestic courts when deciding on the detention requests by the prosecution. They also failed to point to any facts in the detention decisions which confirmed that the purported risks which were said to initially justify the applicant's detention remained valid in the course of the subsequent investigation and trial. Nowhere in the detention decisions was there a sign of the ‘special diligence’ that is required by a court as it considered whether there continued to be ‘relevant and sufficient reasons’ as the period of pre-trial detention continued.

On 25 November 2004 in the case Lebedev (no. 1) the Court held, in a partial decision on admissibility, that the second applicant's detention in custody from 2 July 2003 until 10 September 2004 had been justified. The Court found that some of the arguments put forward by the Russian courts were questionable, whereas others were ‘not devoid of merit’. Assessing the reasons invoked by the Russian authorities as a whole and having regard to the overall length of the applicant's detention accrued by the time of the examination of the first case, the Court accepted ‘that the Russian authorities had not failed to give sufficient and relevant justification for the applicant's continued detention.’ The question before the Court in the present case is whether the reasons adduced by the domestic courts were sufficient to justify the second applicant's detention from 10 September 2004 onwards, i.e. until 16 May 2005.

The Court notes that in Khodorkovskiy (no. 1) it examined the first applicant's detention from the day of his arrest until his conviction within the same criminal proceedings. In that judgment the Court outlined the general principles of its case-law governing the application of Article 5 § 3 of the Convention (see §§ 182–186). It held, in particular, that when choosing a measure of restraint for the first time a court may rely on relatively loose presumptions of fact, and that the existence of a potential risk, for example, the risk of fleeing, cannot be demonstrated with the same degree of certitude as the existence of a fact that has already occurred (see §§ 188 et seq.). Having examined the first detention order in respect of the first applicant, the Court acknowledged that the domestic authorities had little time to evaluate the possibility for applying alternative measures of restraint, and that, although not flawless, the first detention order provided sufficient justification for the applicant's detention on remand.

The Court noted further that in the subsequent period the first applicant's personal situation had evolved, and that some of the risks mentioned in the original detention order ceased to exist. The Court stressed, in particular, that ‘the Russian courts on two occasions failed to indicate reasons for the continued detention of the [first] applicant, they relied on material obtained by way of a violation of the lawyer-client privilege, and never seriously considered other measures of restraint.’ On the last point the Court held as follows:

On the strength of the above the Court concluded that the first applicant's continuous detention was not justified by compelling reasons outweighing the presumption of liberty.

In their submissions the Government described in detail the circumstances of the second applicant's arrest and claimed that his behaviour at that point, as well as his informal exchanges with his lawyers had been indicative of his inclination to flee (see paragraph 489 above). However, the Court notes that these arguments did not constitute part of the domestic courts' reasoning. The Government further referred to the testimony of potential witnesses who had fled the country, allegedly at the insistence of the Yukos management (see paragraph 491 above). The Court notes that that testimony was collected only in 2007–2008 and, consequently, had not been relied upon by the domestic courts in 2003–2005. The same concerns information about credit cards issued by foreign banks in the applicant's name, real-estate abroad and private jets which had allegedly been at the applicant's disposal at Vnukovo airport: those factual elements were not mentioned in the extension orders under examination. The Court reiterates in this respect that ‘it is essentially on the basis of the reasons given in [the detention orders] and of the established facts stated by the applicant in his appeals that the Court is called upon to decide whether or not there has been a violation of Article 5 § 3’ (see, for example, Wiensztal v. Poland, no. 43748/98, § 50, 30 May 2006). In the present case the Court will take into consideration only those arguments and information which were explicitly relied upon by the domestic courts in their decisions (see paragraphs 47 et seq. above) and which the applicant had an opportunity to discuss in the domestic proceedings.

During the period under consideration the domestic courts extended the second applicant's detention with reference to two risks: the risk of tampering with evidence and the risk of absconding. As to the former, the Court notes that by June 2004, when the trial started, all documentary evidence had been already seized by the prosecution, all prosecution witnesses and experts had been questioned and their recorded testimony had been submitted to the court. By the end of 2004 the court had completed its examination of evidence collected by the prosecution. These developments significantly reduced the risk of tampering with evidence. Furthermore, throughout 2004 the main assets of Yukos were attached and sold at auction (see the Yukos case, §§ 92 et seq.). Thus, the second applicant ceased to exercise de facto control over the company; his ability to influence the company's personnel was accordingly reduced. Despite those changes the domestic courts continued to repeat the reasons set out in their earlier detention orders.

The other reason justifying the second applicant's detention was, according to the domestic courts, a risk of absconding. However, the existence of that risk was not convincingly demonstrated in the extension orders. Thus, the mention of the second applicant's ‘international connections’ was too vague and was not supported by any evidence. The Court stresses that, given the advanced stage of the proceedings, the domestic courts were in a position to take a closer look at the second applicant's alleged ‘international connections’ and explain it in their decisions (compare Aleksanyan v. Russia, no. 46468/06, § 187, 22 December 2008, and Aleksandr Makarov v. Russia, no. 15217/07, § 126, 12 March 2009). The reference to the second applicant's character ‘was not accompanied by any description of the applicant's character or an explanation as to why it made his detention necessary’ (see Polonskiy v. Russia, no. 30033/05, § 152, 19 March 2009). The fact that other Yukos managers and shareholders had left Russia might probably have been relevant at the initial stage of the investigation, but ‘the fact that a person is charged with acting in criminal conspiracy is not in itself sufficient to justify long periods of detention; his personal circumstances and behaviour must always be taken into account’ (see Sizov v. Russia, no. 33123/08, § 53, 15 March 2011). Furthermore, the Court notes that ‘the behaviour of a co-accused cannot be a decisive factor for the assessment of the risk of the detainee's absconding. Such assessment should be based on personal circumstances of the detainee’ (see Mamedova v. Russia, no. 7064/05, § 76, 1 June 2006).

The Court also notes that in ordering the extensions the courts used a stereotyped wording. Such an approach may suggest that there was no genuine judicial review of the need for the detention (see Yağcı and Sargın v. Turkey, 8 June 1995, § 50 et seq., Series A no. 319-A) at each extension.

Finally, the domestic courts during the period under consideration never considered the alternative preventive measures provided for by Russian law. The Court reiterates that when deciding whether a person should be released or detained the authorities have an obligation under Article 5 § 3 to consider alternative measures of ensuring his or her appearance at trial. This Convention provision proclaims not only the right to ‘trial within a reasonable time or to release pending trial’ but also lays down that ‘release may be conditioned by guarantees to appear for trial’ (see Jabłoński v. Poland, no. 33492/96, § 83, 21 December 2000, and Sulaoja v. Estonia, no. 55939/00, § 64, in fine, 15 February 2005). In the present case the authorities did not consider the possibility of ensuring the second applicant's attendance by the use of a more lenient preventive measure, such as bail, house arrest, or other measures provided by the Russian law, and ‘the context of the case was not such as to make the applicant obviously ‘non-bailable’ (see Khodorkovskiy (no. 1), § 196, with further references).

The Court concludes that the domestic courts failed to demonstrate that the applicant's detention during the period under consideration (10 September 2004-16 May 2005) was justified by ‘relevant and sufficient’ reasons. There was therefore a violation of Article 5 § 3 of the Convention on this account.

As regards the time given to the defence to prepare their replies to the prosecutor's requests for detention (the requests of 10 September 2004, 14 December 2004 and of 2 March 2005), the Government submitted that virtually all of the detention hearings concerned the same elements: the applicant's financial status and his failure to appear for questioning on 2 July 2003. Thus, the prosecution's arguments were well known to the defence.

Concerning the alleged delays in the examination of the second applicant's appeals against the detention orders, the Government submitted that his appeals had been examined as quickly as was possible in the circumstances and that the periods of examination of the second applicant's appeals were reasonable. Further, the second applicant himself had contributed to the length of the proceedings before the second-instance court which was supposed to examine his appeals against the detention orders.

The second applicant complained of a violation of the principle of equality of arms during the detention hearings. Thus, the requests for extension of his detention were made by the prosecutor orally (and thus in violation of the law) on all three occasions: on 10 September 2004, 14 December 2004 and 2 March 2005. The prosecutor had unlimited time to prepare those requests. In contrast, the second applicant's lawyers were forced to submit an ex tempore response on each occasion, with very limited time. On 10 September 2004 the defence team was given insufficient time to prepare objections to the state prosecutor's oral request for the extension of the second applicant's detention. On 14 December 2004 the defence team was given two hours and thirty minutes to prepare objections to the state prosecutor's oral request for extension of the second applicant's detention; and on 2 March 2005 the defence team was given no time to prepare. Since the prosecutor's request repeated the previous requests practically verbatim, and it became clear that there was no realistic prospect whatsoever that the court would accept the defence's arguments, the second applicant's lawyers decided not to press the court for time to prepare objections.

The appellate court was under an obligation to address the defence arguments, not simply to recite them and then to reiterate the same formulaic and stereotypical conclusions that had been made in the initial detention decisions. The second applicant's appeal (which ran to ten pages) against the extension order of 10 September 2004 cited at least seven separate grounds for quashing the District Court's decision as unlawful and unjustified, but in its ruling of 13 October 2004 the Moscow City Court compendiously rejected all of the defence arguments in just one single sentence. The defence subsequently filed an eight-page appeal against the ruling of the Meshchanskiy District Court of 14 December 2004. Although in its ruling of 19 January 2005 the Moscow City Court cited the defence's arguments, it failed to address them. In the ruling of 31 March 2005, in reply to an eleven pages' appeal against the Meshchanskiy District Court's ruling of 2 March 2005, the appellate court once more failed to engage with the substance of the second applicant's arguments.

The second applicant claimed that the time taken to hear his appeals did not meet the requirement of speediness. Thus, the appeal against the ruling of 10 September 2004 had been considered by the second-instance court on 13 October 2004; the appeal against the ruling of 14 December 2004 had been considered by the second-instance court on 19 January 2005. The second applicant argued that there had thus been unacceptable delays in the light of the Court's case-law on this subject.

The Court reiterates that when the lawfulness of detention pending investigation and trial is examined, the proceedings must be adversarial and must always ensure equality of arms between the parties — the prosecutor and the detainee (see Nikolova v. Bulgaria [GC], no. 31195/96, § 59, ECHR 1999-II; see also Graužinis v. Lithuania, no. 37975/97, § 31, 10 October 2000). This means, in particular, that the detainee should have access to the documents in the investigation file which are essential for assessing the lawfulness of his detention (see Lamy v. Belgium, judgment of 30 March 1989, § 29, Series A no. 151, and Schöps v. Germany, no. 25116/94, § 44, ECHR 2001-I). The detainee should also have an opportunity to comment on the arguments put forward by the prosecution (see Niedbała v. Poland, no. 27915/95, § 67, 4 July 2000).

In the present case the Court has to examine procedures in which the second applicant's detention was extended from 10 September 2004 onwards. According to the second applicant, the defence was not prepared to counter the detention requests lodged by the prosecution. The Government replied that the time given to the defence to counter the detention requests had been sufficient, given that the prosecution had always referred to the same grounds for the continuing detention and the defence had been familiar with their arguments.

The Court observes that the complexity of the prosecution requests for extension may be a relevant factor: the more complex and unexpected the requests are, the more time the defence requires to counter them. In such a situation, where a request for extension comes as a surprise, the defence is in a disadvantageous position vis-à-vis the prosecution.

The Court notes that, by claiming that the extension requests were stereotyped, the Government in fact supported the applicant's complaint under Article 5 § 3 of the Convention (see above): they indicated that, throughout the entire period under consideration, the prosecution's arguments calling for the applicant's detention remained the same.

On the other hand, this same factor speaks in favour of the Government's contention under Article 5 § 4 that the defence had sufficient time to respond to the prosecution's requests, in view of their similarity. The Court reiterates in this respect that ‘Article 5 contains more flexible procedural requirements than Article 6 while being much more stringent as regards speediness’ (see Lebedev (no. 1), § 84). The Court observes that the applicant was represented by a group of highly professional lawyers, that the hearings were adjourned for one or two hours each time when the defence asked for it, and that the defence did not seek extra adjournments (see paragraph 49, 51 and 53 above). The Court concludes that even though the prosecution had more time to develop their arguments, given the nature of the proceedings, this disparity between the parties did not perturb the principle of equality of arms to an extent incompatible with Article 5 § 4 of the Convention.

The second applicant complained that his appeals against the detention orders were not examined speedily by the court of appeal. The Court reiterates that under Article 5 § 4 a detainee is entitled to take proceedings by which the lawfulness of his detention must be decided speedily by a court (see Rehbock v. Slovenia, no. 29462/95, §§ 82–88, ECHR 2000-XII, and G.B. v. Switzerland, no. 27426/95, §§ 34–39, 30 November 2000). Where domestic law provides for a system of appeal, the appellate body must also comply with the requirements of Article 5 § 4; at the same time, the standard of speediness ‘is less stringent when it comes to the proceedings before the court of appeal… The Court would not be concerned, to the same extent, with the speediness of the proceedings before the court of appeal, if the detention order under review was imposed by a court and on condition that the procedure followed by that court had a judicial character and afforded to the detainee the appropriate procedural guarantees’ (see Shakurov v. Russia, no. 55822/10, § 179, 5 June 2012). In the case of Mamedova, cited above, which, like the present case, concerned appeal proceedings, it found that the ‘speediness’ requirement was not complied with where the appeal proceedings lasted thirty-six, twenty-six, thirty-six, and twenty-nine days respectively, stressing that their entire duration was attributable to the authorities (see Mamedova, § 96; see also, for longer delays, Ignatov v. Russia, no. 27193/02, §§ 112–114, 24 May 2007, and Lamazhyk v. Russia, no. 20571/04, §§ 104–106, 30 July 2009). By contrast, the length of appeal proceedings that lasted ten, eleven and sixteen days was found to be compatible with the ‘speediness’ requirement of Article 5 § 4 (see Yudayev v. Russia, no. 40258/03, §§ 84–87, 15 January 2009, and Khodorkovskiy (no. 1), § 247). Finally, the Court reiterates that the delay for which the State may be held responsible should not include the time when the defence was preparing their brief of appeal (see Khodorkovskiy (no. 1), § 247), unless the defence was prevented from finalising it through the fault of the authorities (see Lebedev (no. 1), § 100).

Turning to the present case the Court reiterates that a similar complaint by the second applicant concerning earlier detention orders has already been addressed in Lebedev (no. 1). In that case the Court held that delays of forty-four and sixty-seven days, of which twenty-seven and forty-seven were attributable to the authorities, constituted a breach of Article 5 § 4 (see §§ 98–108). During the period now under examination the detention order of 10 September 2004 was reviewed within twenty-three days, if calculated from the date when the brief of appeal was introduced (see paragraphs 49 et seq. above). The detention order of 14 December 2004 was reviewed by the City Court within twenty-six days. The detention order of 2 March 2005 was examined by the City Court within twenty days from the date when the brief of appeal had been introduced, and only twelve days out of this period can be attributed to the State, since the defence requested an adjournment of the appellate hearing.

Having regard to the Court's case-law cited above the delays in the examination of the appeals against the extension orders of 10 September 2004 and 2 March 2005 do not amount to a violation of the Convention. Only the review of the extension order of 14 December 2004 warrants the Court's attention. In Mamedova a similar delay was found to be in breach of Article 5 § 4, and the Court does not see any reason to hold otherwise in the present case. The Court has not overlooked that the applicant in casu introduced his appeal during the period of long public holidays (New Year and Orthodox Christmas). However, public holidays are not a good excuse for delaying the examination of an application for release (see E. v. Norway, judgment of 29 August 1990, § 66, Series A no. 181-A).

The Court accordingly concludes that the appeal against the detention order of 14 December 2004 was not examined ‘speedily’, as required by Article 5 § 4 of the Convention. There was therefore a violation of that provision in this respect.

The second applicant lastly complained that the court of appeal had not given answers to all of his arguments. The Court reiterates that the absence of reasons in a court decision might in certain circumstances raise an issue of procedural fairness. Usually this question appears in the context of Article 6 § 1 (see Hiro Balani v. Spain, 9 December 1994, Series A no. 303-B), but the Court has also examined it under Article 5 § 4 (see Nikolova, cited above, § 61). However, the Court considers, in view of its earlier findings under Article 5 § 3, that this aspect of the case does not require a separate examination. The second applicant's main grievance was that the domestic courts at two levels of jurisdiction had failed to explain why his detention had been necessary. The Court has already addressed this problem above under Article 5 § 3. It follows that the applicant's complaint under Article 5 § 4, in so far as it concerned the failure of the court of appeal to give reasons, does not require a separate examination.

The Government claimed that Judge Kolesnikova had not been in a situation which might have caused doubts as to her impartiality, as provided by Articles 61–63 of the CCrP, that there had been two other judges on the bench, and that the District Court judgment had later been reviewed at two levels of jurisdiction, including the supervisory review proceedings. None of the procedural decisions taken by her during the trial contained anything which could have been reasonably interpreted as a declaration of the applicants' guilt. Various procedural steps taken by her were solely aimed at securing fair and speedy examination of the case. The law prohibited the judge from expressing her opinion on the substance of the accusation prior to the delivery of the judgment. Further, she was one judge out of three, and the applicants did not express any doubts as to the impartiality of the lay assessors. Finally, the District Court judgment was later reviewed by the judges of the court of appeal, whose impartiality was not contested.

As to Ms Kolesnikova's findings in the judgment in Mr Shakhnovskiy's case, the first applicant's name was mentioned in the Shakhnovskiy judgment only once, in passing, where the District Court described a note written by Ms Kantovich to the first applicant and to Mr Aleksanyan, the then head of the Yukos legal department. That reference to the first applicant's name concerned assessment of evidence and could not be interpreted as showing the judge's bias against the first applicant.

The second applicant's name was mentioned five times in the judgment against Mr Shakhnovskiy. On page 12 of the judgment the court referred to contracts between several leading Yukos executives, including the second applicant, and the firm Status Services; it also mentioned corporate American Express credit cards seized during the search of the applicant's country house. On pages 17 and 19 the court again referred to that evidence as proof of tax evasion. In the Government's opinion, the wording used by Judge Kolesnikova had not contained any declaration of the applicant's guilt; his name had simply been mentioned to identify documents and other evidence against Mr Shakhnovskiy.

The crimes of which Mr Shakhnovskiy was found guilty had been committed by him alone and did not contain, as a qualifying element, the element of an ‘organised group’. That judgment could not therefore be construed as implicating the applicants in the crimes imputed to Mr Shakhnovskiy. The judgment against Mr Shakhnovskiy was very lenient: he was relieved from serving his sentence and acquitted in respect of part of the accusations. In the Government's opinion, this showed that Judge Kolesnikova had no predisposition against Yukos managers.

In their observations on the merits of the case, the Government maintained that law-enforcement bodies did not conduct any inquiries or investigations in respect of Judge Kolesnikova or her relatives over the period 2000–2006.

The applicants claimed that in the judgment concerning Mr Shakhnovskiy Judge Kolesnikova not only concluded that Mr Shakhnovskiy had evaded personal taxes, she also made a finding that the second applicant had similarly evaded personal taxes. Furthermore, in her judgment on the Shakhnovskiy case, Judge Kolesnikova placed reliance on the first applicant's knowledge of that tax arrangement, as demonstrated by a memo written to Mr Khodorkovskiy on behalf of Mr Aleksanyan by Ms Kantovich. The applicants were subsequently convicted by Judge Kolesnikova of exactly the same offence as Mr Shakhnovskiy.

Moreover, Judge Kolesnikova made a series of findings in Mr Shakhnovskiy's trial as to the admissibility of evidence that had been unlawfully seized and which was similarly relied upon in the applicants' trial. In the applicants' trial Judge Kolesnikova once more refused to exclude the evidence as inadmissible. It was irrelevant that Judge Kolesnikova had given Mr Shakhnovskiy a non-custodial sentence: this did not undermine the fact that she had found him guilty and made certain findings of fact.

During the applicants' trial Judge Kolesnikova took decisions that were not only unfavourable to the applicants but plainly unlawful and unjustified. Those decisions concerned the extension of their detention on remand, limitation of time for studying materials and innumerable other decisions adverse to the defence, such as ruling against the admissibility of defence expert reports, ruling against the defence requests to cross-examine prosecution witnesses, ruling against the defence applications for disclosure of exculpatory material, etc., while adopting a differing, more favourable approach to deficient evidence produced by the prosecution. Defence motions were often summarily rejected with no substantive reasons given. Judge Kolesnikova refused to grant permission to the Council of Europe Special Rapporteur to see the applicants. Finally, almost two years after the conclusion of the trial Judge Kolesnikova made an order lifting the seizure of Yukos ordinary shares and directing that they be used towards satisfying the civil damages award. The overwhelming effect was a clear impression that the District Court's presiding judge was biased against the applicants.

It was Judge Kolesnikova who, as presiding judge, had led court sessions. Throughout the trial, the two other judges (Judge Maksimova and Judge Klinkova) asked only a few questions, while Judge Kolesnikova had a more comprehensive role, examining witnesses and specialists and adopting procedural and organisational decisions. From media the applicants became aware of the rumour that Judge Kolesnikova and/or her family members were under investigation by the GPO during the trial. The applicants stressed that Judge Kolesnikova had not done anything to disprove those allegations. Furthermore, that allegation had not been commented by the Government in their pre-admissibility observations.

The Court reiterates that impartiality, within the meaning of Article 6 § 1 of the Convention, normally denotes the absence of prejudice or bias. There are two tests for assessing whether a tribunal is impartial: the first consists of seeking to determine a particular judge's personal conviction or interest in a given case and the second in ascertaining whether the judge offered guarantees sufficient to exclude any legitimate doubt in this respect (see, for example, Gautrin and Others v. France, 20 May 1998, § 58, Reports 1998-III; Daktaras v. Lithuania, no. 42095/98, § 30, ECHR 2000-X; and Kyprianou v. Cyprus [GC], no. 73797/01, § 118, ECHR 2005-XIII).

In applying the first test, the personal impartiality of a judge must be presumed until there is proof to the contrary (see, among other authorities, Padovani v. Italy, 26 February 1993, § 26, Series A no. 257-B; Kyprianou, cited above, § 119, and Kontalexis v. Greece, no. 59000/08, § 54, 31 May 2011). In applying the second test the Court often observed that ‘even appearances may be of a certain importance’, although the standpoint of the accused is not decisive, and what is determinant is whether the fear of partiality may be held to be objectively justified (see Sutyagin v. Russia, no. 30024/02, § 182, 3 May 2011). The mere disagreement with the procedural decisions taken by a judge does not provide a legitimate reason to doubt his or her impartiality (see Academy Trading Ltd and Others v. Greece, no. 30342/96, § 46, 4 April 2000). Similarly, the mere fact that a professional judge had already tried a co-accused and knows the facts of the case is not, in itself, sufficient to cast doubt on that judge's impartiality (see Miminoshvili v. Russia, no. 20197/03, §§ 116–120, 28 June 2011).

The Court takes note of the first applicant's complaint concerning the conditions in which he had to communicate with his lawyers in the Krasnokamensk penal colony. The Court observes that the first applicant's complaint under Article 6 § 3 (c) about the alleged breach of lawyer-client confidentiality concerned criminal proceedings against him. In order to decide whether Article 6 § 3 (c) was complied with the Court does not need to know what happened after those proceedings were over, i.e. after the judgment of the Moscow City Court of 22 September 2005. It follows that this aspect of the case is not material in so far as the first applicant's complaint under Article 6 is concerned. The Court will address only those limitations on written and oral communications between the applicants and their lawyers which concern the period of pre-trial investigation and the trial.

The Court further observes that the applicants did not complain that legal assistance had not been available to them in principle, but that the State had interfered with the confidentiality of their contacts with the lawyers and thus hindered effective legal assistance.

The Court reiterates that the applicants' complaints concerning taking and examination of evidence may be divided into five groups. First, the applicants complained that throughout the proceedings the GPO had tried to manipulate witnesses. Second, the applicants claimed that the evidence produced by the prosecution was improperly obtained and/or unreliable. Third, they maintained that the defence was unable to test some of the evidence relied on by the prosecution. Fourth, the applicants argued that the courts had arbitrarily refused to admit important evidence collected and submitted by the defence. Fifth, they claimed that the courts had not assisted the defence in discovering evidence which had been in the possession of the adverse party, and that the judgment relied on evidence which had disappeared from the case-file or had never existed. The Court will address the applicants' complaints in the same order.

The Government maintained that Russian legislation contained a similar prohibition of retroactive application of criminal law (Articles 3 and 9 of the Criminal Code). Only acts defined as ‘crimes’ in the Criminal Code can be punishable as such. Criminal law cannot be applied ‘by analogy’. Only the law applicable at the moment when the act was committed may be applicable to that act. These provisions must be interpreted narrowly.

In their opinion, the applicants were convicted for actions which had been regarded as criminal at the moment when they were committed, and the applicants had been well aware of that fact. Russian criminal law was sufficiently clear on the matter; the relevant legislation had been published in the official mass media and was thus available to the applicants or their legal consultants. The Government stressed that the applicants, as businessmen, could have solicited the opinion of the most experienced lawyers. In addition, the first applicant held two university degrees. It was hard to believe that the applicants had never assessed the risks related to their business activities in Russia, including the risks in the sphere of criminal law. The complexity of the tax-avoidance scheme suggested that it had been designed after a careful analysis of the applicable legislation in order to preserve unlawfully obtained money.

Tax evasion, a crime proscribed by Articles 198 and 199 of the Code, was a deliberate act, aimed at the default in payment of taxes and dues in large or very large amounts which led to the partial or complete non-receipt of those taxes and dues by the treasury. There could be different methods of tax evasion. For example, it could occur in the form of a deliberate and knowing indication of false information in the tax declaration or in other documents which the taxpayer must submit to the tax authority in accordance with the law. ‘Other documents’ in this context meant any documents necessary for the calculation of the taxes due. ‘Deliberate’ meant the existence of a direct intent to give false information. ‘False information’ was understood as any incorrect data about the object of the tax (i.e. property, revenue or other operations and status), about the right to tax deductions, credits etc., which could affect the correctness of the calculation of the amount due by the taxpayer. ‘Indication of the false information’ could take the form of the taxpayer's failure to indicate the true amount of his revenues; artificial minimisation of revenues or increase of deductible costs; falsification of data on the time period when certain revenues were received or losses suffered; distortion of physical characteristics of a particular type of business activity, etc.

The tax authorities had already revealed other tax-evasion schemes used by other taxpayers. In support of this argument the Government cited the names of several companies which had been using tax evasion schemes, although they had not caused as much damage to the State as the applicants. The Government further referred to the opinion of the Financial Action Task Force on Money Laundering (FATF), which noted that tax-evasion schemes were quite widespread and were constantly developing, becoming more and more complex and sophisticated, which called for the enactment of new laws penalising particular types of conduct. Their report on money laundering in 1999-98 mentioned the use of offshore companies as a common tax-evasion technique. The Financial Action Task Force continued to discover new forms of tax evasion every year; however, this could not preclude the States from bringing the persons responsible for tax evasion to criminal liability. Although the Criminal Code of Russia contained clear provisions penalising tax evasion, it could not describe in detail all possible schemes.

The Government stressed that the domestic courts had established that the applicants intentionally developed various techniques aimed at tax evasion. The very nature of the acts incriminated to the applicants showed that they had been deliberate, and that the applicants must have known about their criminal character.

In the Government's opinion, the tax-evasion scheme invented and implemented by the applicants in the present case clearly fell within the scope of Article 199 of the Code. The central question was therefore whether such schemes had been discovered and penalised in any other case before the applicants were brought to trial. The Government asserted that the tax-evasion schemes used by the applicants were ‘relatively new’ and were discovered only in the course of the investigation into the applicants' case. Thus, the sham companies were registered and functioned on the territories enjoying a special taxation regime. However, the ZATO Act clearly established criteria which permitted companies incorporated and registered in those locations to use that special regime. In order to benefit from tax cuts the companies had to have up to 90 per cent of their fixed assets and 70 per cent of their human resources concentrated in those territories. Seventy per cent of the wage-fund was supposed to be paid to locally-hired employees. The companies which were buying oil from Yukos did not correspond to those requirements; consequently, they obtained tax cuts unlawfully and caused damage to the State. The provisions of the Criminal Code of the Russian Federation which applied to the applicants' case were clear and did not change. What changed (or, rather, what had been amplified) was the practice of their application.

The Government indicated that Articles 198 and 199 of the Criminal Code were interpreted in Rulings no. 8 of the Supreme Court of 4 July 1997 and no. 64 of 28 December 2006. The Government quoted definitions of tax evasion from those articles and referred to a number of criminal cases concerning tax evasion. In particular, the Government produced copies of judgments in the cases of Tasoyev (judgment of the Dolgoprudniy Town Court of the Moscow Region of 17 December 2002); Zhuravlev (judgment of the Dubna Town Court of the Moscow Region of 14 March 2003); Yakubov (judgment of 17 March 2004 by the Istra District Court of the Moscow Region); Simikyan (judgment of the Belovo Town Court of 26 May 2004); and Yakimov (judgment of the Kirovskiy District Court of Kazan of 2 August 2004). Those cases concerned the failure of taxpayers to submit tax declarations to the tax authorities or to indicate in the declarations the real amounts of their income or their turnover.

The Government also submitted a copy of the judgment in the case of Mironov (judgment of 7 October 2004 by the Basmanniy District Court of Moscow) which concerned the operations of a branch of a foreign firm registered in Cyprus. The defendant in that case pleaded guilty and was convicted for concealing the firm's business activities on the territory of Moscow in 1999–2003. Finally, the Government produced a copy of the decision by the Supreme Court (sitting as a court of appeal) in the case of Selivanov (decision of 30 October 2002), which concerned tax evasion and breach of custom regulations. That case concerned the use of ‘front companies’ in 1997–1998 for the purpose of securing a reduction in taxes and customs dues. In the Government's view, those cases described different schemes which could be characterised as ‘tax evasion’.

In addition, the Government referred to several judgments by the commercial courts at different levels which concerned non-payment of taxes by corporate entities. The Government indicated that legal professionals and the general public had access to that case-law.

The Government also referred to the answers to the frequently asked questions given by various tax officials and published in legal databases, which explained different situations which could be described as ‘tax evasion’. They submitted extracts from articles published in the specialised press by legal scholars and tax practitioners on the application of Articles 198 and 199 of the Criminal Code, methods and procedure for tax inspections, powers of the tax police and tax inspectorates, participation by the police in tax inspections, tax offences under the Tax Code, etc. In particular, in one of the articles, published in 1999 in the Nalogoviy Vestnik magazine, no. 9, the author wrote that a common form of tax evasion by individual entrepreneurs (p. 68) consisted of the receipt of ‘consulting fees’ under fake consulting agreements which were then re-distributed to the payers of those ‘fees’. An article published in no. 3 of that magazine in 2002 (p. 126) described such a form of tax evasion as reimbursement of VAT on the ground of an export operation which in fact had not taken place.

The Government explained that the use of offshore companies as a specific method of reducing the amount of taxes due was immaterial for the legal characterisation of the act as ‘tax evasion’.

Finally, the allegations of retroactive application of criminal law were examined by the courts at two instances and were dismissed as unfounded.

The applicants invited the Court not to take into account its findings in the Yukos case, claiming that they touched upon different issues. The applicants stressed in particular that the Yukos case was not their case, that conviction of an individual for ‘knowing’ and ‘intentional’ tax evasion under Articles 198 and 199 was not under consideration in that case, and that the Yukos case had quite a different focus to the criminal judgments at the heart of the present case.

The Court reiterates that Article 7 embodies the principle nullum crimen, nulla poena sine lege, and the requirement that criminal law must not be extensively construed to the detriment of an accused, for instance by analogy (see Jorgic v. Germany, no. 74613/01, § 100, ECHR 2007-III (extracts), or Kafkaris v. Cyprus [GC], no. 21906/04, § 138, ECHR 2008).

When speaking of ‘law’ Article 7 alludes to the very same concept as that to which the Convention refers elsewhere when using that term, a concept which comprises statutes as well as bylaws and case-law and implies qualitative requirements, including those of accessibility and foreseeability. It follows that the offences and the relevant penalties must be clearly defined in law. This requirement is satisfied when the individual can know from the wording of the relevant provision and, if need be, with the assistance of the courts' interpretation of it or by way of appropriate legal advice, to a degree that is reasonable in the circumstances, what acts and omissions will make him criminally liable (see Liivik v. Estonia, no. 12157/05, § 93, 25 June 2009; Achour v. France [GC], no. 67335/01, § 42, ECHR 2006-IV). Foreseeability depends to a considerable degree on the content of the law concerned, the field it is designed to cover and the number and status of those to whom it is addressed. A law may still satisfy the requirement of ‘foreseeability’ where the person concerned has to take appropriate legal advice to assess, to a degree that is reasonable in the circumstances, the consequences which a given action may entail (see Scoppola v. Italy (no.2) [GC], no. 10249/03, § 102, 17 September 2009).

The Court stresses that ‘in any system of law, including criminal law, however clearly drafted a legal provision may be, there is an inevitable element of judicial interpretation. There will always be a need for elucidation of doubtful points and for adaptation to changing circumstances’ (see Moiseyev, cited above, § 234). The Court also reiterates that ‘the wording of statutes is not always precise. One of the standard techniques of regulation by rules is to use general categorisations as opposed to exhaustive lists. That means that many laws are inevitably couched in terms which, to a greater or lesser extent are vague, and their interpretation and application depend on practice’ (see Scoppola (no. 2) [GC], cited above, § 100). Furthermore, in most of the member States, the progressive development of the criminal law through judicial law-making is a well-entrenched and necessary part of legal tradition. Article 7 of the Convention cannot be read as outlawing the gradual clarification of the rules of criminal liability through judicial interpretation from case to case, provided that the resultant development is consistent with the essence of the offence and could reasonably be foreseen (see Streletz, Kessler and Krenz v. Germany [GC], nos. 34044/96, 35532/97 and 44801/98, § 50, ECHR 2001-II; K.-H.W. v. Germany [GC], no. 37201/97, § 85, ECHR 2001-II (extracts); and Kononov v. Latvia [GC], no. 36376/04, § 185, ECHR 2010). Even more so: ‘it is a firmly established part of the legal tradition of the States party to the Convention that case-law, as one of the sources of the law, necessarily contributes to the gradual development of the criminal law’ (see Kruslin v. France, 24 April 1990, § 29, Series A no. 176-A).

The question is what degree of scrutiny the Court should apply to the decisions of the domestic courts which develop the existing case-law and interpret provisions of the law in the light of the modern-day conditions. The Court's case-law suggest that its supervisory function consists in considering whether the national court, in reaching its decision, has not unreasonably interpreted, and applied to the applicant, the law concerned. In other words, the Court applies a relaxed standard in such matters, which allows the States to develop their case-law and adjust it to the changing conditions of modern society (see Eurofinacom v. France (dec.), no. 5873/00, ECHR 2004-VII (extracts)).

Thus, in the case of S.W. v. the United Kingdom (22 November 1995, Series A no. 335-B) the Court was confronted with criminalisation of ‘marital rape’ by means of judicial interpretation of a very ancient legal norm which appeared to exclude criminal liability for such act. The Court did not find a violation of Article 7 in this case referring to the fact that the old distinction between ‘lawful’ and ‘unlawful’ involuntary sexual intercourse was clearly obsolete, that the new interpretation continued ‘a perceptible line of case-law development’ and that ‘the essentially debasing character of rape’ was so manifest that the judicial recognition of such behaviour as criminal was not ‘at variance with the object and purpose of Article 7 of the Convention’ (see §§ 42–44).

In a more recent case of Huhtamäki v. Finland (no. 54468/09, §§ 50 et seq., 6 March 2012) the Court examined a situation where the Finnish Supreme Court was facing ‘a new situation in which it had to take a stand for the first time on the issue of whether the right not to incriminate oneself could have effects on other persons connected to the crime in question. Both domestic law and jurisprudence were silent on this point’. In that case the Court found no violation of Article 7 of the Convention, stressing that ‘it does not question the interpretation and application of national law by national courts unless there has been a flagrant non-observance or arbitrariness in the application of that law (see also Société Colas Est and Others v. France, no. 37971/97, § 43, ECHR 2002-III and, mutatis mutandis, Lavents v. Latvia, no. 58442/00, § 114, 28 November 2002)’.

Further, in the highly technical spheres, such as, for example, taxation, the Court's case-law incites businessmen to take ‘special care’ in assessing the risks that their professional activity entails (see Cantoni v. France, 15 November 1996, § 35, Reports of Judgments and Decisions 1996-V), if need be with the assistance of a lawyer (see Jorgic, cited above, §§ 101–102).

Finally, the absence of previous identical cases in the domestic judicial practice does not mean that a criminal conviction is contrary to Article 7; it is conceivable that the national jurisdictions have not yet had a chance to be confronted with such situations (see Soros v. France, no. 50425/06, §§ 57–58, 6 October 2011).

The Court reiterates that in the Yukos case it did not address the company's complaint under Article 7 of the Convention (see § 667). However, it examined whether the bringing of the company to tax liability for evading company taxes was ‘based on a reasonable and foreseeable interpretation of the domestic law’ (see the title above § 576 of the Yukos judgment). That allegation was examined under Article 1 of Protocol No. 1 to the Convention. The Court considers that its findings under Article 1 of Protocol No. 1 in the Yukos case cannot be automatically applied to the applicants' complaint under Article 7 in the present case. However, there are many similarities between the applicants' position under Article 7 and the company's arguments under Article 1 of Protocol No. 1 to the Convention in the Yukos case. Consequently, the Court's findings in Yukos are of relevance. The Court will recall the most important elements of its findings concerning the lawfulness of tax reassessment insofar as it applied to the company:

The Government maintained that there had been no interference with the applicants' rights under Article 8 of the Convention. The Government emphasised that any limitation of the applicants' rights under Article 8 was related to their criminal conviction and was inherent in the very concept of criminal punishment. The Government described the geographical position of the Krasnokamensk colony (where the first applicant had been sent) and the Kharp colony (where the second applicant had been sent) and transport routes linking them to Moscow, where the applicants' families lived. They concluded that there had been no interference with the applicants' private lives on account of their placement in those particular penal colonies.

Further, the colonies where the applicants were serving their sentences had special facilities for long-term family visits. Those facilities were furnished and equipped with household appliances. The applicants could have had six short-term and four long-term family visits per year. Furthermore, they were entitled to obtain additional family visits as a reward for exemplary behaviour. The relatives were informed about the time of the visits in advance. The administration of the penal colonies had never refused the applicants or their relatives the right to a visit.

In any event, even if there had been an interference with the applicants' rights under Article 8, it was in accordance with paragraph 2 of this Convention provision. Thus, the Government insisted that the measure complained of was lawful. Under Article 73 of the CES a convict was entitled to serve his prison sentence in the same federal constituency where he was convicted (in the applicants' case, Moscow). However, where this is impossible, the convict was sent to serve his sentence in a penal colony situated in the next closest federal constituency. Several regions of Russia (Moscow, St Petersburg and some republics of the Northern Caucasus) have no general-regime penal colonies. In order to avoid prison overcrowding and comply with the requirements of Article 3 of the Convention, as interpreted in the Court's case-law in respect to prison conditions in Russia, convicts from those regions were sent to colonies situated in other regions. For example, convicts from Moscow often served their sentences even further from Moscow than the town of Krasnokamensk, where the first applicant had been sent. According to the Government, Article 73 of the CES ‘was complied with in the majority of the federal constituencies of the Russian Federation’. In many regions new penal colonies were being built. The applicants were treated in this respect in the same manner as any other convict in a similar situation. There were no grounds for giving the applicants preferential treatment because of their family or financial situation. They were sent to serve their sentences in such distant locations because there was no place for them in other regions of Russia.

The Government further maintained that it had been necessary to guarantee the security of the applicants themselves. The Government considered that since the applicants' case had been widely publicised, it had been important to protect them from ‘unauthorised contacts with journalists, ill-disposed private individuals, in particular those who had suffered as a result of [the applicant's crimes]…, from unauthorised rallies and picketing’. Furthermore, the Government noted that the applicants' cellmates could have learned that they had money in foreign banks. That could have put the applicants in danger. In the Government's words, the detainees in the Yamalo-Nenetskiy Autonomous region and in the Chita region were less informed about the details of the applicants' case than those in Central Russia. Therefore, the applicants were more secure where they were.

Finally, the Government indicated that if, by derogation from the general rule, the applicants had obtained places in a prison closer to Moscow that would also have disposed their cellmates against them and could have put them in danger.

In the applicants' words, the location of the penal colony in which they had to serve their sentences was of direct relevance to their rights under Article 8. It was inevitable that serving their sentences in such remote places had interfered with their family life to a greater degree than if they had been sent to a penal colony nearer to Moscow.

The applicants described the hardships related to travelling from Moscow to Krasnokamensk and Kharp. In support, the first applicant cited an article written by a group of journalists who had accompanied his relatives on their trip to the penal colony and testimony by his lawyers. As a direct consequence of his transfer to Krasnokamensk, his family had only been able to make use of the ‘short’ visits on one occasion since 2005. Of course, had the applicant been serving his sentence closer to his family, he would have been able to make far greater use of the facility for short visits. On account of the exhausting and demanding nature of the journey, his young twin sons were unable to visit him in Krasnokamensk at all. The children were able to visit the first applicant whilst he was detained in Moscow. The first applicant's elderly father had been able to visit him only once. The fact that the first applicant's family did not use up his full allowance of visits — he had five long visits and only one short visit over 14 months at IK-10 penal colony — clearly suggested that the enormous distance prevented visits taking place.

The second applicant also described the hardships associated with travelling from Moscow to the Kharp colony. In his words, they totally precluded his family — his wife and two daughters, who at the relevant time were two and four years old — from visiting him in the colony because of the length of the train journey and the difficulties of crossing the river. In any event, visiting the applicant was a time-consuming, nerve-straining and expensive matter, and for young children it was practically impossible.

In the applicants' words, such deliberate social isolation did not meet the requirements of Article 8 § 2 of the Convention. Firstly, it had no legal basis. Under the law, it was incumbent upon the Russian authorities to send the applicants to serve their sentences in a colony in Moscow or in the Moscow Region. The Government provided no evidence in support of their assertion that overcrowding in Moscow prisons was such that the applicants could not be sent to a penal colony in the Moscow region. Further, the Government did not challenge the first applicant's assertion that in September 2005 there had been 149,674 available places in penal colonies in the Russian Federation out of a total capacity of 786,753 places. It was for the Government to demonstrate why, of all those available places, it had been the penal colony at Krasnokamensk which had been the ‘nearest’ penal colony that was available, as required by Article 73 of the CES.

Furthermore the Government's allegation that it had been done for the applicants' own safety was untrue. First, the authorities had taken into account considerations which were not provided for by Article 73 of the CES. Second, the Government did not explain why the risk allegedly posed by the other inmates would be lower in Krasnokamensk or Kharp than in Moscow. In fact, for more than two years the applicants had been held in remand prisons in the city of Moscow, and there had not been a single incident involving them during that time concerning relations with their cellmates. In addition, the Russian authorities had failed to produce evidence that the applicants had been in danger because of other detainees.

The applicants submitted that the domestic courts' dismissal of their complaints against their imprisonment in the remote colonies had not been determinative of the issue of whether the decisions had been ‘in accordance with the law’ as required by Article 8, for the following reasons. First, the domestic courts wrongly accepted the arguments of the representatives of the FSIN that that there was no requirement upon them to consider the individual circumstances of the convict. Such a contention was clearly incompatible with Article 8. Second, the domestic courts were similarly wrong in failing to require an explanation as to why it was that the applicants was sent to Krasnokamensk and Kharp, thousands of kilometres from Moscow, despite the fact that there were 149,674 available places in penal colonies in the Russian Federation as at September 2005. The applicants also emphasised that the Government relied on grounds which were not provided for by Article 73 § 2 of the CES, in particular to protect the applicants from possible unauthorized contacts with the representatives of the mass media.

The real reason for the applicants' transfer to Siberia had been stated by Mr Shuvalov, then a senior Presidential aid. In an interview with The Economist in July 2006 Mr Shuvalov said that the first applicant was sent to a Siberian colony in order to send a warning to Russia's other tycoons. The domestic courts failed to enquire why it was that both applicants had also been sent to a very remote region of the Russian Federation in apparent disregard of the provisions of the law. The fact that both men had been sent thousands of miles from Moscow was strongly suggestive of improper motives on the part of the State authorities.

The parties disagreed as to whether the fact of serving a sentence in a particular penal colony amounts to an ‘interference’ with one's private life. The Court reiterates in this respect that any detention which is lawful for the purposes of Article 5 of the Convention (and there is no doubt that the applicants' detention following their conviction complied with Article 5 § 1 (a) of the Convention) entails by its nature various limitations on private and family life (see Silver and Others v. the United Kingdom, 25 March 1983, § 98, Series A, no. 161). It would be fundamentally wrong to analyse each and every case of detention following conviction from the standpoint of Article 8, and to consider the ‘lawfulness’ and ‘proportionality’ of the prison sentence as such.

Thus, as a starting point, the Court accepts that the authorities had a wide discretion in matters related to execution of sentences. However, the Convention cannot stop at the prison gate (see Hirst v. the United Kingdom (no. 2) [GC], no. 74025/01, § 70, ECHR 2005-IX), and there is no question that a prisoner forfeits all of his Article 8 rights merely because of his status as a person detained following conviction (see Ploski v. Poland, no. 26761/95, 12 November 2002). The Court will not turn a blind eye to such limitations which go beyond what would normally be accepted in the case of an ordinary detainee. Thus, for example, it is an essential part of a prisoner's right to respect for family life that the prison authorities assist him in maintaining contact with his close family (see Messina v. Italy (no. 2), no. 25498/94, § 61, ECHR 2000-X). Limitations on contacts with other prisoners and with family members, imposed by prison rules, have been regarded by the Court as an ‘interference’ with the rights protected by Article 8 of the Convention (see Van der Ven v. the Netherlands, no. 50901/99, § 69, ECHR 2003-II).

Thus, placing a convict in a particular prison may potentially raise an issue under Article 8 if its effects for the applicant's private and family life go beyond ‘normal’ hardships and restrictions inherent to the very concept of imprisonment. As the Commission already observed in Wakefield v. the United Kingdom (no. 15817/89, decision of 1 October 1990, DR 66, p. 251): ‘Article 8 requires the State to assist prisoners as far as possible to create and sustain ties with people outside prison in order to promote prisoners' social rehabilitation. In this context the location of the place where a prisoner is detained is relevant’. Furthermore, the right to respect for family life imposes upon states a positive obligation to assist prisoners in maintaining effective contact with their close family members (see X. v. the United Kingdom, no. 9054/80, Commission decision of 8 October 1982, DR 30, p. 115). In the context of imprisonment the Commission recognised that the possibility for close family members to visit a detainee constitutes an essential factor in the maintenance of family life (see Hacisuleymanoglou v. Italy no. 23241/94, decision of 20 October 1994, DR no. 79-B, p. 121).

The Court reiterates that in the Wakefield case the Commission considered that the refusal to allow the applicant a permanent transfer from Yorkshire to Scotland to be near his fiancée had constituted an interference with the applicant's right to respect for private life. In the present case the distances involved were much longer than those in Wakefield. Given the geographical situation of the colonies concerned, and the realities of the Russian transport system the Court has no difficulty in accepting that a trip from Moscow to the Krasnokamensk colony or the Kharp colony was a long and exhaustive endeavour, especially for the applicants' young children. Indeed, it was not the applicants themselves but the members of their respective families who suffered from the remoteness of the colonies. Still, the applicants were affected by this measure, albeit indirectly, because they probably received fewer visits than they would have received had they been located closer to Moscow. In sum, the Court finds that this measure constituted an interference with the applicants' Article 8 rights to privacy and family life.

The Court now will turn to the justification for the interference. The Court reiterates that under Article 8 § 2 an interference with family and private life is justified if it is ‘in accordance with the law and is necessary in a democratic society in the interests of national security, public safety or the economic well-being of the country, for the prevention of disorder or crime, for the protection of health or morals, or for the protection of the rights and freedoms of others’.

The Government claimed that the situation at issue was not covered by Article 1 of Protocol No. 1 to the Convention, and that for two reasons. First, the Government indicated that the tax claims were submitted by the authorities within the framework of criminal proceedings against the applicant. Referring to the case of Ferrazzini v. Italy [GC] (no. 44759/98, ECHR 2001-VII), the Government submitted that ‘tax matters still form part of the hard core of public-authority prerogatives, with the public nature of the relationship between the taxpayer and the community remaining predominant’ (§ 29).

The Government further claimed that Article 1 of Protocol No. 1 cannot be applied to the recovery of unpaid taxes. Unpaid taxes were not the applicant's ‘property’, since they were acquired unlawfully. The unlawful origin of that money was duly established by the judgment of the Meshchanskiy District Court of 16 May 2005. The Government acknowledged that the term ‘possessions’ used in this Convention provision had an autonomous meaning. However, in the Government's opinion, their claim that ‘possessions’ did not include unpaid taxes had foundation not only in national law, but also in international law. It would be outrageous to require from the States that they respect ‘possessions’ that had been acquired unlawfully.

Alternatively, if the Court was prepared to admit that the money recovered from the first applicant was his ‘possession’ within the meaning of Article 1 of Protocol No. 1 to the Convention, the Government maintained that the interference with his rights had been compatible with that provision. The Government reiterated the principles established in the Court's case-law under Article 1 of Protocol No. 1 to the Convention, in particular concerning the wide margin of appreciation enjoyed by the member States, their better knowledge and understanding of local conditions and needs and the Court's limited role of supervision in that area. The Government also indicated that it was not incompatible with Article 1 of Protocol No. 1 to recover property from a debtor, even if that property did not belong to him but was in his possession.

On the facts the Government maintained that the first applicant had been found guilty of various economic crimes, which involved misappropriation of public money and public property. He committed those crimes as a member of an organised group. His criminal activities were premeditated, carefully planned and lasted several years. In such circumstances the amounts recovered from him must be regarded as compensation due to society and the State for the wrongs committed by him. The first applicant was therefore deprived of his possessions in the public interest, which prevails in this context over his private interest. The Government concluded that Article 1 of Protocol No. 1 to the Convention had not been breached in the applicant's case.

According to the Government, Russian law provides for a possibility to examine, within criminal proceedings, civil claims of the victim of the crime towards the perpetrator. Article 110 of the Tax Code provides that the mens rea of the corporate taxpayer is defined with reference to the mens rea of the managers who acted on its behalf. As a general rule, tax claims concerning unpaid corporate taxes are brought against the corporate taxpayer. However, there are a few exceptions from this rule. Thus, if at the moment when the claim is introduced, the corporate entity still exists but it does not have sufficient assets to satisfy the claim, this triggers the subsidiary liability of the person who was responsible for the tax debt. The same rule applies where the legal entity was liquidated or changed owners at the moment when tax claims were introduced.

The recovery of the outstanding tax claims from the first applicant was lawful, since the creation of the sham companies by him and the control of their operations contained elements of the actus reus provided by Article 199 of the Criminal Code. It would be inefficient to recover taxes from those sham companies which the first applicant had created, since they were unable to compensate damage caused to the treasury. Russian law did not provide for criminal liability of legal persons. Consequently, in the present case the underlying general rule was that the damage should be compensated by the tortfeasor. The sham companies which participated in the tax evasion scheme have been closed or reorganised in order to conceal the crimes. However, that should not have prevented the State from recovering damages. The first applicant's reference to the Supreme Court's judgment in the case of I. and K. (see paragraph 449 above) was irrelevant.

The first applicant claimed that the Government's objection that Article 1 of Protocol No. 1 was inapplicable to the case was incorrect and their reliance on Ferrazzini was misconceived. In Ferrazzini the Grand Chamber held that tax disputes fell outside the scope of ‘civil rights and obligation’ for the purposes of defining the applicability of Article 6 § 1, and not of Article 1 of Protocol No. 1. On the contrary, it was the settled case-law of the Court that the collection of taxes involves an interference with the rights protected under Article 1 of Protocol 1. The applicant referred to Burden v. the United Kingdom [GC], no. 13378/05, § 59, ECHR 2008; Orion-Breclav, S.R.O v. the Czech Republic (dec.), no. 43783/98, 13 January 2004).

In the first applicant's opinion, the Court's admissibility decision left open two key questions:

As to the first of those questions, the first applicant alleged that claims for damages in relation to company tax evasion should be brought against the companies that are alleged to have evaded the taxes and thus the Meshchanskiy District Court was not entitled to make any award of damages against him under this charge. Thus in the I. and K. case the Russian Supreme Court stated that there was no legal justification for upholding a civil claim filed by the tax authorities for the evasion of taxes that were not paid by a joint-stock company implicated in a criminal case to the private individuals convicted in the relevant case. The principles set out in I. and K. were applied by the Moscow Regional Court on 9 October 2002 in its report ‘On the results of an examination of criminal cases in the economic sphere by the Moscow region courts during 2000 and the first half of 2002’:

In their submissions the Russian Government did not refer to any legislative provisions or case law to support their arguments. They asserted that the Supreme Court decision in I. and K. was now ‘irrelevant’ as on 18 December 2002 a new Criminal Procedure Code came into force. However, the Government's assertions were not supported by reference to any subsequent case-law demonstrating that the case had been challenged, let alone overruled. The Government's references to the changes in the Criminal Procedure Code introduced in 2002 were equally unsubstantiated: there was no analysis of how the new Code undermined the judgment of the Supreme Court in I. and K. in any way. The provisions of the new Code had not altered the basis for the Supreme Court's findings. In any event, it was impossible to understand how, even if the new Criminal Procedure Code were relevant, it could, consistent with the principle of fair balance, have retrospective effect.

As to the second of the issues, namely the possibility for ‘double recovery’ of the same amounts of unpaid taxes from a company and its top-executive, the first applicant claimed that the Government had not addressed this question. In the applicant's view, the civil damages award was manifestly arbitrary as:

Subsequent domestic decisions in related cases had concluded that the promissory notes were redeemed in full: see the judgments of the Sverdlovsk Regional Court in the Ivannikov case and the judgment of the Miass City Court of Chelyabinsk Oblast in the Lubenets case.

The first applicant argued that the decisions of both the trial court and the court of appeal had been entirely unreasoned as to how the damages award had been calculated. The amounts recovered from him by virtue of the judgment of 16 May 2005 were the same as the amounts recovered from the companies affiliated with the first applicant — in particular, Yukos. The Meshchanskiy District Court ordered the first applicant to pay the Federal Tax Service RUB 17,395,449,282 in relation to the latter's claim for damages arising from the alleged non-payment of taxes by the ZATO trading companies. The total award for damages related to the crime committed under Article 199 of the Criminal Code comprised:

The basis of the Moscow City Court's decision on this point was that even if one assumed that payment of tax by the Lesnoy companies by using promissory notes had been unlawful in 1999 and 2000, by the time that the first applicant's case came to trial the wording of Article 199 of the Criminal Code had been amended so as to exclude the possibility of his being convicted under that (or any other) provision of the Criminal Code in respect of such conduct, and the applicant was therefore entitled to invoke the benefit of that change. As a result, the total amount of unpaid taxes was reduced by the Moscow City Court to RUB 1,217,622,799 for 1999 and to RUB 1,566,046,683 for 2000. Despite this change, the court of appeal refused to reduce the amount of the civil claim.

In the Yukos tax proceedings in 2004 the Russian Tax Ministry (the predecessor to the Federal Tax Service) had secured the payment of taxes (plus interest and fines) by Yukos of the same alleged tax arrears for 2000 by the ZATO trading companies. The basis for the award was that the trading companies were said to be sham companies and that the ultimate beneficiary was Yukos. Subsequently, in related cases, it has been accepted that the promissory notes were redeemed in full and that there was no loss.

In the first applicant's words, the award by the Meshchanskiy District Court of damages amounting to RUB 17,395,449,282 undoubtedly represented an interference with the peaceful enjoyment of his possessions. The first applicant's assets were sequestrated pending resolution of the damages claim. Seized bank accounts and shares have been channelled towards meeting the award of damages.

The first applicant further alleged that the award of damages made by the Meshchanskiy District Court had been unlawful. Thus, the Meshchanskiy District Court did not have jurisdiction to make an award of damages against the first applicant since, in any event, the alleged loss to the State had already been recovered in the tax proceedings against Yukos.

As regards the striking the fair balance between private and public interest, the first applicant acknowledged that the Court has given a considerable margin of appreciation to States in relation to fiscal matters, provided always that measures did not amount to arbitrary confiscation. Given that the damages award was itself unlawful and that the alleged loss to the State for the year 2000 had already been recovered in the Yukos tax proceedings, the issue as to ‘fair balance’ did not fall to be considered. Moreover, subsequent court decisions had confirmed the first applicant's consistent case that the promissory notes used by the ZATO companies in 1999 had been redeemed in full and thus there had been no loss to the State.

The Court reiterates that the first and most important requirement of Article 1 of Protocol No. 1 is that any interference by a public authority with the peaceful enjoyment of possessions should be lawful: the second sentence of the first paragraph authorises a deprivation of possessions only ‘subject to the conditions provided for by law’ and the second paragraph recognises that the States have the right to control the use of property by enforcing ‘laws’ (see Iatridis v. Greece [GC], no. 31107/96, § 58, ECHR 1999-II).

Further, according to the Court's well-established case-law, an instance of interference, including one resulting from a measure to secure payment of taxes, must strike a ‘fair balance’ between the demands of the general interest of the community and the requirements of the protection of the individual's fundamental rights. The States, when framing and implementing policies in the area of taxation, enjoys a wide margin of appreciation, since decisions in this area will commonly involve the appreciation of political, economic and social questions which the Convention leaves within the competence of the States parties. The second paragraph of Article 1 explicitly reserves the right of Contracting States to enact such laws as they may deem necessary to secure the payment of taxes. In the case of Gasus Dosier- und Fördertechnik GmbH v. the Netherlands (23 February 1995, § 59, Series A no. 306-B), the Court stated that ‘the importance which the drafters of the Convention attached to this aspect of the second paragraph of Article 1 may be gauged from the fact that at a stage when the proposed text did not contain such explicit reference to taxes, it was already understood to reserve the States’ power to pass whatever fiscal laws they considered desirable, provided always that measures in this field did not amount to arbitrary confiscation (see Sir David Maxwell-Fyfe, Rapporteur of the Committee on Legal and Administrative Questions, Second Session of the Consultative Assembly, Sixteenth Sitting (25 August 1950), Collected Edition of the Travaux préparatoires, vol. VI, p. 140, commenting on the text of the proposed Article 10A, ibid., p. 68)’. The power of appreciation of the States parties in such matters is therefore a wide one (see Gasus Dosier- und Fördertechnik GmbH, cited above, § 60; see also Sporrong and Lönnroth v. Sweden, 23 September 1982, § 69, Series A no. 52; National & Provincial Building Society, Leeds Permanent Building Society and Yorkshire Building Society, 23 October 1997, § 80, Reports of Judgments and Decisions 1997-VII; and M.A. and 34 Others v. Finland (dec.), no. 27793/95, 10 June 2003; see also, mutatis mutandis, Bendenoun v. France, 24 February 1994, § 46, Series A no. 284).

The Government submitted that the applicants' allegations that their criminal prosecution had been politically motivated were not supported by the materials of the case. The Government insisted on the serious and genuine nature of the criminal charges brought against the applicants. They stressed that the investigating and prosecuting authorities had acted bona fide and in full compliance with national legislation, which had been proved by the judgment of the Meshchanskiy District Court of Moscow delivered in the applicants' case. The fact of the applicants' conviction by the national courts, upheld by the national supreme judicial authority, was a sufficiently strong argument to rebut the applicants' arguments in relation to alleged violations of Article 18 of the Convention.

The Government referred to the Court's findings in the first applicant's case (Khodorkovskiy (no. 1), no. 5829/04) where the Court had not found that the first applicant's prosecution was driven by improper motives. In particular, the Court found that the evidence submitted by the first applicant was not sufficient to conclude that the Russian authorities acted in bad faith and in total disregard of the Convention. The Government asserted that the criminal prosecution of the applicants had pursued a legitimate aim and had been justified and lawful.

The applicants maintained that the proceedings against them and other leading Yukos executives had been driven by political motives.

The applicants submitted that, notwithstanding the Court's conclusion in Khodorkovskiy (no. 1), it was open to the Court to find a violation of Article 18 in the current case. First, the first case concerned only the pre-trial issues. Furthermore, the Court in that case did not consider some of the evidence, namely the witness statement by Mr Kasyanov, the former Prime Minister, and the report of the Russian President's expert advisory group, which analysed the applicants' second trial. There was now a clear global consensus, including judgments from the highest courts in Switzerland and Cyprus, that the applicants' prosecution was politically motivated. Finally, the Court's approach to Article 18 in Khodorkovskiy (no. 1) was inconsistent with the Convention case-law. The travaux préparatoires for Article 18 indicated that the drafters of this provision were concerned to ensure thereby that an individual was protected from the imposition of restrictions arising from a desire of the State to protect itself according ‘to the political tendency which it represents’ and the desire of the State to act ‘against an opposition which it considers dangerous’.

In contrast to the case-law under Article 18, in Khodorkovskiy (no. 1) the former First Section found that an applicant must establish that the reason for his detention is solely prompted by reasons other than those provided for in Article 5 of the Convention and, moreover, that his prosecution ‘from beginning to end’ was infected with ‘bad faith and in blatant disregard of the Convention’. In no previous case has the Court applied such a test.

If Article 18 is to be of any value in protecting individuals from the misuse of power that Article 18 is designed to afford, then the Court must adopt a flexible test that recognises that, once the applicant has established a strong prima facie case, he is not required to prove facts ‘incontrovertibly’, since such facts are primarily within the knowledge of the State. Such recognition is apparent from the Court's approach to Article 14, which like Article 18, has no autonomous place in the Convention but has a particular character in the case-law (see D.H. and Others v. the Czech Republic, no. 57325/00, § 186, 13 November 2007). The former First Section made it almost impossible for an individual to prove a political motive, as the evidence as to the political motive will almost always be held by the Government.

According to the applicants, the evidence before the Court led to the conclusion that the applicants' prosecution was motivated, at the very least in part, by political considerations. In support of their allegations the applicants referred to various documents, namely the findings of the Special Rapporteur of the Parliamentary Assembly of the Council of Europe, endorsed by the Parliamentary Assembly, which had concluded that the circumstances of the first applicant's case went ‘beyond the mere pursuit of criminal justice, and include[d] elements such as the weakening of an outspoken political opponent, the intimidation of other wealthy individuals and the regaining of control of strategic economic assets’. They also referred to the European Parliament' Resolution of May 2009 which labelled the first applicant as a political prisoner. The applicants further referred to the judgment of a London court in extradition proceedings against former Yukos executives, where the judge had concluded that the prosecution of Mr Khodorkovskiy had been politically motivated. A decision of the Swiss Federal Court mentioned a ‘political component’ to the applicants' case. The applicants also referred to a decision of a Lithuanian court in extradition proceedings and other decisions by the courts and arbitration tribunals which supported their thesis of political motivation for their prosecution.

In 2005 Amnesty International stated that it believed there was a ‘significant political context to the arrest and prosecution’ of the applicants and other Yukos staff. Several other NGOs made declarations to the same effect.

The applicants also mentioned the opinions of various public figures in Russia and abroad who had characterised the proceedings against Yukos executives as political. The applicants relied on statements by the former Prime Minister, Mr Kasyanov, the Economic Development and Trade Minister, Mr Gref, President Putin's Economic Adviser, Mr Illarionov, Presidential Aide, Mr Shuvalov (see paragraph 373 above), as well as by other senior political figures who had made similar comments (such as the former Minister of Economy, Mr Yasin, and the Chairman of the Federation Council, the higher chamber of the Russian parliament, Mr Mironov).

The applicants submitted that the restrictions imposed upon their fair trial rights in the course of their trial and appeal were specifically linked with ‘other reasons’, contrary to Article 18. There were many breaches of their rights which showed bad faith on the part of the authorities. Similarly, the decision that the applicants should be sent to the Chita Region and to the Yamalo-Nenetskiy Region to serve their sentences, thereby greatly impeding their contact with their families and lawyers, was taken for improper reasons. Whilst at the penal colonies the applicants had been targeted with illegal, unfair, disproportionate and discriminatory disciplinary proceedings designed to affect their prospects of release on parole. The applicants further gave an account of what they called ‘the consistent pattern of harassment and intimidation of the … lawyers’.

The Government asserted that the first applicant had had the necessary time and facilities to prepare and submit an application before the Court, and that his many lawyers had assisted him in preparing the application.

The law allowed him to meet the lawyers representing him before the European Court. During the first applicant's detention in the penal colony meetings with his lawyers, including those representing him in the Strasbourg proceedings, took place outside the first applicant's working hours. At the time such was the requirement of point 83 of the Internal Regulations of the Penal Colonies, enacted by the Order of the Ministry of Justice of 3 November 2005. On 2 March 2006 the Supreme Court of the Russian Federation declared that the Order in that part was unlawful. Since then meetings were also allowed during working hours.

In addition, the first applicant knew how to apply to the European Court because, in all the premises where he was detained, notice-boards displayed information for prospective applicants. The first applicant was also able to address questions and complaints concerning proceedings before the European Court to the colony administration and to the FSIN officials. The Government stressed that in accordance with the Court's case-law the officials of the prison system had been briefed on how to inform detainees about the Court's procedures and rules, without, at the same time, putting any pressure on them or discouraging them from complaining.

The fact that the first applicant submitted a very detailed and complex application form and was assisted by five lawyers showed, in the Government's words, that he had not been hindered in any way by the authorities.

As to the episode of 22 July 2005, when Ms Mikhaylova had been denied access to the applicant, the Government asserted that the applicant had misled the Court about her status — she had not been his advocate and had not therefore been entitled to visit him in the remand prison. Article 53 of the CCrP provided that an advocate must be formally admitted to act in the proceedings by the official in charge of the case. Although Ms Mikhaylova had the status of an advocate, she was not on the list of lawyers admitted to participate in that particular criminal case. As a result, she was not allowed to see the applicant in the capacity of his advocate. She could have visited him in her private capacity, but she failed to obtain written permission for such a visit from the investigator. The Russian law distinguishes between the notions of ‘defence counsel’ (3ащиThик) and ‘advocate’ (адboкаT, i.e. a barrister). In order to become a ‘defence counsel’ the advocate must have been admitted to participate in the case in this capacity. Ms Mikhaylova was an ‘advocate’, but she had not obtained authorisation to participate in the case as the applicant's ‘counsel’. The same concerned the episode of 27 July 2005, when Ms Mikhaylova and Mr Prokhorov were denied access to the applicant by the remand prison administration. The Government concluded that the applicant's rights under Article 34 had not been breached.

The first applicant submitted that the Government failed to address the Court's questions. In particular, they were entirely silent on the fact that applications for visas to travel to see the applicant made by Mr Nicholas Blake QC and Mr Jonathan Glasson, British lawyers acting in these proceedings, were refused. Neither had they been able to see their client. The Government had not commented on the authorities' attempts to disbar the first applicant's lawyers. Both of his Russian representatives in the Strasbourg proceedings had faced disbarment proceedings: thus, in September 2005, immediately after the appeal hearing, the GPO sought the disbarment of Ms Moskalenko; in March 2007 disbarment proceedings were again instigated against Ms Moskalenko. Disbarment proceedings were also taken against Mr Drel following the appeal hearing.

The Government claimed that the first applicant had had sufficient time and requisite facilities to draw up his application to the Court, but they entirely overlooked the fact that he had had to ask the Court's permission for a further six months in order to present his substantive application. The first applicant experienced particular difficulties in accessing his lawyers in the period leading up to the expiry on 22 March 2006 of the six-month deadline for submitting his complaint to the Court. On 17 March 2006 the first applicant was placed in the punishment block for drinking tea in the wrong place.

The first applicant successfully challenged the rule that he was not permitted access to lawyers in working hours, asserting that it interfered, amongst other things, with his ability to bring a complaint to the European Court. In a judgment dated 2 March 2006 the Supreme Court stated that the rule was invalid. The Government accepted that prior to the Supreme Court decision access to the first applicant's lawyers had been refused during working hours, but offered no explanation as to why such an unlawful restriction on access had not hindered his right of access to this Court.

Moreover, the Government's assertion that access had been permitted after the Supreme Court's decision was, in the first applicant's words, incorrect. The colony administration continued to refuse his lawyers access to him during working hours. The administration gave the excuse that they had not seen the Supreme Court's decision, although the first applicant's lawyers had provided them with a copy of that decision.

The Government's arguments that Ms Mikhaylova needed the authorisation of the Meshchanskiy District Court in order to see the first applicant were wrong as a matter of domestic law. Ms Mikhaylova was authorised by the first applicant to act for him both in relation to the ECHR proceedings and in his criminal trial. There was no merit in the Government's argument that she had lacked the necessary court authorisation to gain access to the applicant.

Finally, the first applicant maintained that his lawyers had been subjected to harassment and intimidation. In support he referred, in particular, to the conclusions of Senior Judge Workman in the extradition proceedings in the United Kingdom who concluded that ‘at least some of the lawyers had suffered harassment and intimidation’. The first applicant also referred to the words of the President of the Moscow Bar Association who had commented that, to date, the Federal Registration Service had been mainly concerned with requests to deprive the first applicant's lawyers of the right to practice. He said that only two applications from the Service have not been linked to the Yukos case.

The abuse of the law-enforcement process in the prosecution of the applicant was seen in the case of Mr Aleksanyan. Mr Aleksanyan was one of the first applicant's lawyers and has also been one of Mr Lebedev's lawyers. On 27 November 2007 the GPO investigator Ms R., in the presence of Mr Aleksanyan's lawyer, put pressure on Mr Aleksanyan to make a false confession and give false testimony against other persons, in exchange for release for medical treatment (Mr Aleksanyan was seriously ill). Mr Aleksanyan had himself explained to the Supreme Court of Russia that this had not been the only instance whereby the GPO offered to release him in exchange for false testimony against the applicants, in particular on 28 December 2006.

The particular difficulties faced by the first applicant's Strasbourg lawyers were to be seen in the broader context of the consistent harassment of the first applicant's lawyers and the manifest disregard the authorities had shown for lawyer/client confidentiality. Mr Drel was summoned for questioning the day the applicant was arrested. Within a few weeks of the first applicant having being arrested, one of the applicant's young lawyers (Ms Artyukhova) was searched, two documents unlawfully seized from her, and she was subjected to disbarment proceedings.

The first applicant did not submit any claim for pecuniary damage. Under the head of non-pecuniary damages, he sought a ‘deliberately modest’ amount of EUR 10,000.

The Government left the determination of the amount of just satisfaction at the Court's discretion.

The Court observes that it has found several violations of the Convention in this case in respect of the first applicant. Those violations must have caused the first applicant stress and frustration, which cannot be compensated solely by the findings of violations. The Court, taking into account the cumulative effect of the violations of the first applicant's rights and making its assessment on an equitable basis, in view of all evidence and information available to it, grants him the amount sought, i.e. EUR 10,000, plus any tax that may be charged on that amount.

The second applicant claimed only pecuniary damages in the amount of EUR 6,800,000, which represented his lost earnings. He submitted his tax declarations for several years to demonstrate the level of his earnings before his arrest.

The Government did not submit any specific comments on the second applicant's claims for just satisfaction but simply restated the principles of the Court's case-law on awarding just satisfaction.

The Court notes that the second applicant's claim in respect of pecuniary damage is based on the understanding that his conviction was entirely baseless and that it was the sole cause of his loss of earnings. The Court is not persuaded by this argument. Although the Court found several violations of the second applicant's rights under Articles 3, 6 and 8 in the present case, the loss of his earnings can be attributed to many other factors, primarily to the tax proceedings involving Yukos, which eventually led to its bankruptcy and liquidation. The second applicant's detention throughout 2004 and 2005 undoubtedly played some part in those proceedings. However, the Court does not need to speculate in this respect. It observes that the link between the violations found in the present case and the loss of the second applicant's earnings, if any, is too remote and uncertain. The Court concludes that the second applicant's claims for pecuniary damages are unjustified and must be rejected.