15269/89

 AS TO THE ADMISSIBILITY OF Application No. 15269/89 by the Josef MÜLLER AG against Switzerland The European Commission of Human Rights (Second Chamber) sitting in private on 5 December 1990, the following members being present: MM. G. JÖRUNDSSON, Acting President of the Second Chamber S. TRECHSEL A. WEITZEL H.G. SCHERMERS Mrs. G. H. THUNE MM. F. MARTINEZ Mrs. J. LIDDY MM. J.-C. GEUS M.P. PELLONPÄÄ Mr. K. ROGGE, Secretary to the Second Chamber Having regard to Article 25 of the Convention for the Protection of Human Rights and Fundamental Freedoms; Having regard to the application introduced on 14 May 1989 by the Josef MÜLLER AG against Switzerland and registered on 20 May 1989 under file No. 15269/89; Having regard to the observations submitted by the respondent Government on 8 May 1990 and the observations in reply submitted by the applicant's company on 11 June 1990; Having deliberated; Decides as follows: THE FACTS The facts of the case, as submitted by the parties, may be summarised as follows: The applicant company is a stock corporation (Aktien- gesellschaft) with its seat in Zürich. Before the Commission it is represented by Mr. J. Müller, the President of the board (Verwaltungsrat) of the applicant company. The applicant company was, and has again become, the wholesale marketing company (Vertriebsfirma) for the "Less Rheuma ointment (Heilsalbe)". Problems arose in respect of defects in the material of the tubes. The applicant company was subsequently involved in civil and criminal proceedings in the Federal Republic of Germany and in Switzerland. The present application concerns mainly the authorisation (Bewilligung) of the Zürich authorities concerning this ointment. A. Particular circumstances of the case I. On 25 May 1976 the Direction of Health (Gesundheitsdirektion) of Canton Zürich granted the applicant company the authorisation to "produce as a salaried commission, and to undertake wholesale commerce (agency) in respect of the product 'Less Rheuma ointment'" ("das Präparat 'Less Rheuma-Heilsalbe' im Lohnauftrag herstellen zu lassen und Grosshandel [Vermittlung] damit zu betreiben"; see below Relevant domestic law and practice). This authorisation which was granted under various conditions expired on 31 December 1980. The ointment was supervised by and registered with, the Intercantonal Control Office for medicaments (Interkantonale Kontrollstelle für Heilmittel) for a period lasting until 31 December 1979. On 3 February 1981 an inspector of the Cantonal Pharmacy (Kantonsapotheke) inspected a storage room of the applicant company where he found defect tubes of the "Less Rheuma ointment". On 13 February 1981 the Zürich Cantonal Pharmacist informed the applicant company that the authorisation granted on 25 May 1976 had expired. The company was requested to provide information inter alia as to certain defects in the package material of the ointment. On 20 February 1981 the applicant company filed a request for a prolongation of the expired authorisation. It thereby stated that it undertook the marketing (Vertrieb) of the product and was neither the producer nor the manufacturer of the product which was prepared and packed elsewhere. On 11 March 1981 the Cantonal Pharmacist again requested information until 27 March 1981 from the applicant company as to the production, control, packing, storing and delivery of the ointment and the measures undertaken to protect its quality. On 28 and 30 March 1981 the applicant company replied that it was registered in Canton Zürich as a wholesale pharmaceutical commerce (Pharma-Grossist). It neither produced the ointment nor did it maintain a production plant, and it was not in a position to give details about production. The Cantonal Pharmacist was also not competent to request information as to the registration of medicaments as this fell solely to the Intercantonal Control Office. On 24 April 1981 the Zürich Direction of Health issued an order (Verfügung) in which it refused the applicant company's request for a prolongation of the authorisation for wholesale commerce (agency) of the ointment. The Direction considered in particular that details would have to be supplied as to the exact circumstances of production and marketing of the ointment. In the present case the conditions for granting a marketing authorisation (Vertriebs- bewilligung) had not been met. The Direction of Health also imposed costs of 100 SFr. on the applicant company. On 19 June 1981 the applicant company filed an appeal (Rekurs) against this decision with the Zürich Council of State (Regierungsrat) in which it requested inter alia the prolongation of the authorisation for the wholesale commerce (Grosshandel) of the ointment. Therein it referred to its position as a marketing company. On 26 August 1981 the Council of State dismissed the appeal. It noted that since 1 January 1980 the ointment was not longer validly registered with the Intercantonal Control Office and that a renewed registration now seemed improbable as the circumstances of production were unknown. An authorisation for the marketing (Vertrieb) of the ointment through a wholesale distributor (Verteiler-Grossist) was therefore inadmissible. The Council of State concluded that for this reason even during the appeal proceedings the marketing of the ointment was prohibited. The Council of State also imposed costs of 500 SFr. on the applicant company. Against this decision the applicant company filed on 4 October 1981 an appeal (Beschwerde) with the Zürich Administrative Court (Verwaltungsgericht). On 22 June 1982 the Administrative Court partly upheld the applicant company's appeal. It referred the case-file for further investigation and for renewed decision along the lines of its decision back to the Council of State. In its decision the Court observed that the Council of State had mainly considered that the applicant company had applied for an authorisation as a wholesale distributor (Verteiler-Grossist) within the meaning of No. 3 para. 4 of the 1976 Guidelines (see below Relevant domestic law and practice). In this case the Council of State could have justifiably refused the authorisation. However, it was not clear whether the applicant company had only applied for an authorisation as a wholesale distributor. The authorisation of 25 May 1976 had entitled the applicant company until 31 December 1980 to produce as a salaried commission, and to undertake wholesale commerce in respect of the ointment concerned. The applicant company thus had the authorisation of a marketing firm according to No. 3 para. 5 of the 1976 Guidelines which entitled it to register the ointment with the Intercantonal Control Office. In its reply of 28 and 30 March 1981 the applicant company had told the Cantonal Pharmacist that it was a marketing rather than a production company (eine Vertriebs- und nicht eine Herstellerfirma). The Zürich Direction of Health had also concluded on 24 April 1981 that the conditions for a marketing authorisation had not been met. In his appeal of 19 June 1981 the applicant company had again referred to itself as a marketing company (Vertriebsfirma). The Court concluded that the Council of State should have granted the applicant company the opportunity to clarify its request. It therefore partly upheld the appeal of the applicant company. In referring the case-file back to the Council of State, the Court considered that if the applicant company no longer wanted a renewal of the authorisation as a wholesale marketing company, the proceedings would become irrelevant. On the other hand, if the applicant company insisted on such an authorisation, the Council of State would have to examine whether the conditions were met. The Court could not prejudice such a decision. The applicant company filed a request for review (Revision) of this decision of the Administrative Court which the latter dismissed on 7 June 1983. On 10 November 1982, the applicant company filed a public law appeal (staatsrechtliche Beschwerde) which was declared inadmissible by the Federal Court (Bundesgericht) on 10 January 1984. In its public law appeal the applicant company stated that it had not applied for the authorisation as a marketing firm within the meaning of No. 3 paras. 4 and 5 of the 1972 guidelines. II. Meanwhile, as a result of the decision of the Zürich Administrative Court, the Zürich Council of State requested the applicant company on 26 October 1982 to file within ten days the necessary further information for its appeal. The request was served on the applicant company on 19 November 1982. The Council of State informed the applicant company in particular as follows:

"Sollte sie nicht innert Frist einen unmissverständlichen Antrag auf Erteilung einer Bewilligung für den Grosshandel als Vertriebsfirma stellen, wäre bei der weiteren Rekursbehandlung davon auszugehen, es sei ein Gesuch um Erteilung der Bewilligung zum Grosshandel als Verteiler- Grossist gestellt worden."

"If (the applicant company) does not file within the time-limit an unambiguous request to be granted an authorisation for the wholesale commerce as a marketing firm, it would have to be assumed when further dealing with the appeal that a request had been filed to be granted an authorisation as a wholesale distributor." On 24 November 1982 the applicant company replied that it requested "the authorisation for the wholesale commerce as a marketing firm to be prolonged" ("die Grosshandelsbewilligung als Vertriebsfirma zu verlängern"). III. In a letter of 17 March 1988 to the Intercantonal Control Office, the applicant company complained that for five and a half years it had been waiting to be granted the authorisation for a marketing firm; if the authorisation was not granted very soon, the applicant company would complain to the Federal Court about the delay. On 20 June 1988 the Cantonal Pharmacist wrote to the Intercantonal Control Office explaining, inter alia, that it appeared from the letter of 17 March 1988 that the applicant company was awaiting the renewal of the authorisation and that the Cantonal Pharmacist was willing to grant this authorisation if the applicant company complied with the necessary conditions. The Intercantonal Control Office was requested to undertake the necessary inspections. On 9 September 1988 the applicant company filed a public law appeal with the Federal Court in which it complained of the delay in the proceedings. The applicant company referred therein to the letter of the Cantonal Pharmacy of 20 June 1988 as showing the Zürich authorities knew that the applicant company was waiting for the authorisation. The applicant company complained inter alia that the delay of six years breached the right to a fair and public hearing within a reasonable time within the meaning of Article 6 of the Convention. On 28 October 1988 the Zürich Direction of Health informed the Federal Court that while on 24 November 1982 the applicant company had indeed asked the Council of State for the authorisation as a marketing company, two weeks earlier in its public law appeal to the Federal Court of 10 November 1982 it had stated that it had never asked for an authorisation as a marketing company within the meaning of No. 3 paras. 4 and 5 of the 1972 Guidelines. The Direction of Health observed that in view of this about-change (Kehrtwendung) the Council of State did not for the time being pursue the proceedings. Meanwhile, the matter had been taken over by the Intercantonal Control Office which had arranged an inspection with the applicant company on 8 November 1988. On 19 December 1988 the Federal Court declared the applicant company's public law appeal inadmissible. The Court, which noted that the applicant company had continued to act as a marketing firm for the ointment, regarded in principle the public law appeal against the inactivity of the Council of State as admissible. However, according to its case-law the applicant company could no longer claim a practical interest in its public law appeal since the Cantonal Pharmacy with its letter of 20 June 1988 had again taken up the procedure for the Council of State (see below Relevant domestic law and practice). According to a letter of 30 May 1990 of the Federal Court to the applicant company, the decision of 19 December 1989 was served on the applicant on 19 January 1988. The Federal Court further confirmed "that before this date no operative part of the decision had separately been served (on the applicant company)" ("dass Ihnen vor diesem Datum kein Urteilsdispositiv separat eröffnet worden ist"). On 16 May 1989 the Direction of Health issued an order according to which the applicant company was granted, until 31 December 1993, the authorisation to "produce as a salaried commission, and to undertake wholesale commerce (agency) in respect of ... the 'Less Rheuma ointment'" ("im Lohnauftrag herstellen zu lassen und Grosshandel damit zu betreiben"). IV. On 11 April 1990 the Zürich Council of State decided to strike the appeal of the applicant company of 19 June 1981 off its list of cases (gegenstandlos geworden), as the applicant company had been granted the authorisation for a marketing firm. The Council of State further cancelled the imposition of costs of its decision of 26 August 1981 and of the order of the Zürich Direction of Health on 24 April 1981. On 21 May 1990 the applicant company appealed against this decision to the Zürich Administrative Court, claiming inter alia that it should be granted compensation for the expenses of the proceedings. On 13 July 1990 the Zürich Administrative Court dismissed the appeal stating that it could only grant compensation if the authority concerned had acted arbitrarily or negligently. This could not be said of the order of the Zürich Direction of Health of 24 April 1981. B. Relevant domestic law and practice The preparation and sale of medicaments falls under the constitutional right to freedom of commerce (Handels- und Gewerbefreiheit) as enshrined in Article 31 of the Swiss Federal Constitution (Bundesverfassung). The cantons may restrict this right on police grounds (polizeiliche Gründe), namely for the protection of public health and security (see e.g. ATF 106 Ia 267). These police restrictions must also respect the principle of proportionality and the equality of the persons engaged in the commerce. If a commercial activity requires for police reasons a police authorisation (Polizeibewilligung), the police authority will state, upon application, whether there are obstacles to the activity. In the Canton of Zürich the Direction of Health authorises the preparation and sale of the medicaments. As regards the health police restrictions, the applicant must offer guarantees as to the preparation, storing, control and sale of the medicament. According to Article 8bis of the 1972 Regulative Order on the Execution of the Intercantonal Agreement on the Control of Medicaments (Regulativ über die Ausführung der interkantonalen Vereinbarung über die Kontrolle der Heilmittel) and No. 3 para. 1 of the 1976 Guidelines of the Intercantonal Control Office for the Wholesale Commerce of Medicaments (Richtlinien betreffend den Grosshandel mit Arzneimitteln), wholesale commerce is to be understood as the agency (Vermittlung) of medicaments towards firms and persons who are entitled to store the medicaments, further to sell them or professionaly to apply them. According to No. 3 para. 4 of the Guidelines, wholesale dealers (Grosshändler) whose activities are confined to distributional functions are considered as wholesale distributors (Verteiler-Grossisten), whereas according to No. 3 para. 5 wholesale dealers, who have registered medicaments with the International Control Office, are considered as marketing companies (Vertriebsfirmen). Article 4 of the Swiss Federal Constitution, which enshrines the principle of equality, has been interpreted by the Federal Court as prohibiting the denial of justice as well as delays in proceedings (Verbot der Rechtsverweigerung und Rechtsverzögerung, see ATF 103 V 190). However, the Federal Court will not deal with such a complaint if, during its proceedings, the authority concerned has given its decision or resumed the proceedings; the Federal Court then considers that the applicant no longer has a practical interest in his case (see ATF 110 Ia 141). COMPLAINTS The applicant company complains of the length of the proceedings following the decision of the Administrative Court on 22 June 1982. Six years were required until a decision was taken in respect of the authorisation concerned. The applicant company disputes that it undertook activities in respect of the ointment without the required authorisation. The applicant company also complains inter alia that it did not have a fair hearing before the Council of State and the Federal Court, and that the latter did not examine its public law appeal. The applicant company relies on Article 6 paras. 1, 2 and 3(d) and Articles 7, 8 and 13 of the Convention. PROCEEDINGS BEFORE THE COMMISSION The application was introduced on 14 July 1989 and registered on 20 July 1989. On 5 March 1990 the Commission decided to communicate the application to the respondent Government and invite them to submit written observations on the admissibility and merits of the application limited to the issue under Article 6 para. 1 of the Convention concerning the length of the proceedings. The Government's observations were received by letter dated 8 May 1990 and the applicant's observations were dated 11 June 1990. On 7 November 1990 the Commission, having consulted the parties, decided to refer the application to the Second Chamber. THE LAW 1. The applicant company complains under Article 6 para. 1 (Art. 6-1) of the Convention, of the length of the proceedings in which it was involved. This provision states, insofar as it is relevant: "In the determination of his civil rights and obligations ... everyone is entitled to a ... hearing within a reasonable time by an independent and impartial tribunal established by law. ..." a) According to Article 26 (Art. 26) of the Convention the Commission may only deal with the matter "within a period of six months from the date on which the final decision was taken". The applicant company submits, with reference to the Federal Court's letter of 30 May 1990 (see above The Facts), that it has complied with this time-limit. Thus, the decision of the Federal Court of 19 December 1988 was served on 19 January 1989. On 14 July 1989, i.e. within six months, it filed its application with the Commission. The Government submit that the applicant company has not complied with the time-limit of six months as specified in Article 26 (Art. 26) of the Convention. With reference to the case of P. v. Switzerland (Application No. 9299/81, Dec. 13.3.84, D.R. 36 p. 20) they contend that the applicant company was already aware of the essential elements of the decision of the Federal Court of 19 December 1988 when its operative part was served on the applicant company. The time-limit of Article 26 (Art. 26) must be calculated as from that date. The Commission notes that, according to the Federal Court's letter of 30 May 1990, the operative part of the decision of 19 December 1988 was not served separately on the applicant company, but together with the grounds of the judgment on 19 January 1989. Moreover, as in the case of P. v. Switzerland, which also concerned the length of proceedings (see No. 9299/81, ibid.), the Federal Court was, in the present case, confronted with a complaint invoking a provision of the Convention. Only the reasoned decision of the Federal Court would enable the applicant company to decide whether an application to the Commission was likely to succeed and to give reasons for such an application. The Commission thus considers that the period of six months specified in Article 26 (Art. 26) of the Convention must be calculated as from 19 January 1989, and that the applicant company has therefore filed its application on time. b) As regards the applicability of Article 6 para. 1 (Art. 6-1) of the Convention to the proceedings at issue the applicant company considers that, except if there had been good reasons to the contrary, the authorisation concerned should have been renewed automatically. However, in the present case the Direction of Health unilaterally and unfairly refused to renew the authorisation. Moreover, following the decision of the Zürich Administrative Court of 22 June 1982, the Zürich Council of State was obliged to grant the authorisation. The applicant company further submits that the period to be determined under Article 6 para. 1 (Art. 6-1) of the Convention commenced before the Zürich Administrative Court gave its decision on 22 June 1982. During the ensuing proceedings, the applicant company was active, as its request of 24 November 1982 to the Council of State demonstrates. On the other hand, the Council of State remained inactive. The respondent Government submit, with reference to the Benthem case (see Eur. Court H.R., judgment of 23 October 1985, Series A no. 97, p. 14 et seq., paras. 30 et seq.), that, for Article 6 para. 1 (Art. 6-1) of the Convention to apply, there must be a dispute concerning a right which must also be of a civil character. In the present case, the authorisation concerned was a police authorisation (see above Relevant domestic law and practice) which has a predominantly public law character. Moreover, the applicant company's previous authorisation expired on 31 December 1980. The present application concerns the applicant company's new request of 20 February 1981, rather than a modification of the previous one. There was therefore, also no right involved. The Government further submit that the period to be examined under Article 6 para. 1 (Art. 6-1) of the Convention commenced on 22 June 1982, when the Zürich Administrative Court gave its decision. The period lasted until 16 May 1989 when the authorisation was granted. The Government explain this long period with the applicant's contradictory conduct. Thus, while on 24 November 1982 the applicant company stated that it requested the prolongation of the authorisation for the wholesale commerce as a marketing firm, previously on 10 November 1982, it stated that it had not applied for such an authorisation. In view thereof, the Council of State did not find it necessary to pursue the case. The Government contend that the applicant company was inactive during the period at issue. It has not been shown that it regularly asked for the proceedings to be resumed. On the other hand, the Swiss authorities were active in that, on 26 October 1982, the Council of State wrote to the applicant company. The applicant company suffered no financial damages, as it continued to exercise marketing activities. The Commission, having regard to the parties' submissions under Article 6 para. 1 (Art. 6-1) of the Convention concerning the length of the proceedings, considers that this complaint raises complex issues of fact and law which can only be resolved by an examination of the merits. This part of the application cannot, therefore, be declared manifestly ill-founded within the meaning of Article 27 para. 2 (Art. 27-2) of the Convention. No other grounds for inadmissibility have been established. 2. The applicant company further complains that the Federal Court in its decision of 19 December 1988 found that the applicant company lacked a practical interest in its public law appeal on which, furthermore, the Court had decided too summarily. The applicant company relies on Article 13 (Art. 13) of the Convention which provides: "Everyone whose rights and freedoms as set forth in this Convention are violated shall have an effective remedy before a national authority notwithstanding that the violation has been committed by persons acting in an official capacity." The Commission recalls the case-law of the Convention organs that where an individual has an arguable claim to be victim of a violation of the rights set forth in the Convention, he should have a remedy before a national authority in order both to have his claim decided and, if appropriate, to obtain redress (see Eur. Court H.R., Klass and others judgment of 6 September 1978, Series A no. 28, p. 29 para. 64). However, in the present case the Commission finds that the applicant company's complaint is directed against the decision of a court, namely the Federal Court, of 19 December 1988. It follows that a remedy against a violation of the Convention allegedly committed by this court would require the possibility to appeal against its judgment. However, the right to appeal is not as such guaranteed by Article 13 (Art. 13) of the Convention (see Eur. Court H.R., Delcourt judgment of 17 January 1970, Series A no. 11, p. 14 para. 25). It follows therefrom that this provision cannot be relied upon in circumstances where the alleged violation of the Convention lies in the decision of a court (see No. 11508/85, Barfod

v. Denmark, Dec. 17.7.86, to be published in D.R.) in particular, as in the present case, a Supreme Court. This part of the application must therefore be declared inadmissible as being manifestly ill-founded within the meaning of Article 27 para. 2 (Art. 27-2) of the Convention. 3. Insofar as the applicant company further complains about the various proceedings and the ensuing decisions under Article 6 paras. 1, 2 and 3 (d) (Art. 6-1, 6-2, 6-3-d) and Articles 7 (Art. 7) and 8 (Art. 8) of the Convention, the Commission finds no issue. It follows that the remainder of the application is also manifestly ill-founded within the meaning of Article 27 para. 2 (Art. 27-2) of the Convention. For these reasons, the Commission, by a majority DECLARES ADMISSIBLE, without prejudging the merits of the case, the applicant's complaint under Article 6 para. 1 (Art. 6-1) of the Convention concerning the length of the proceedings; DECLARES INADMISSIBLE the remainder of the application. Secretary to the Second Chamber Acting President of the Second Chamber (K. ROGGE) (G. JÖRUNDSSON)