The Italian criminal code must not deprive the Italian justice system of a reasonable period of time to complete procedures underway against value-added tax (VAT) fraud, Advocate General Yves Bot stressed in conclusions returned on Tuesday 18 July (case C-42/17), on the basis of European case-law.
In order to ensure the effectiveness of the fight against fraud harming the financial interests of the EU (article 325 TFEU), the Court of Justice of the EU in September 2015 judged that the Italian courts should not apply a provision of Italian criminal law whereby the statute of limitations may never be extended by more than one quarter of its initial duration (Taricco judgment, case C-105/14) (see EUROPE 11384). Consequently, given the complexity and length of the criminal proceedings, VAT fraud infringements are generally time-barred before any penal sanctions can be handed down.
The Italian Constitutional Court asked the Court for further clarifications. The Advocate General considers that it is not about calling into question the very principle set out by the Court in its 2015 judgment. He explained that the principle that penalties must be lawful covers the definition of infringement and level of penalties applicable to them, but does not extend to defining the statute of limitations, which may therefore be longer than the one in place at the time the infringement was committed.
Bot also argues that this conclusion is compatible with the requirement of predictability, as the individuals concerned could not, at the time they acted unlawfully, have been unaware that the actions in question were likely to engage their criminal liability. The acts constituted infringements at the time they were committed and the penalties will not be more stringent than those in force at that time. (Original version in French by Mathieu Bion)