C-153/00

'Medical practitioners, surgeons, health officers, apothecaries, midwives and all other persons who, owing to their status or profession, obtain knowledge of secrets entrusted to them and disclose them other- By his questions, the investigating judge wise than if called upon to give evidence in seeks to determine whether Belgian legis- legal proceedings or before a parliamentary lation on giving evidence in legal proceed- committee of inquiry or unless required to ings is compatible with Community law. disclose them by law, shall be liable to He also seeks to obtain the necessary imprisonment of eight days to six months information to determine whether certain and a fine ranging from one hundred to five aspects of the Luxembourg legislation on hundred francs'. 2 banking secrecy are compatible with Com- munity law. 2 — The actual amount of the fine provided for in Article 458 of the Criminal Code ranges from BEF 20 000 to 100 000 (see the written observations of the Kingdom of Belgium, 1 — Original language: French. paragraph 40).

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'Any person summoned to be heard as a 'Medical practitioners, surgeons, health witness is obliged to appear and satisfy the officers, apothecaries, midwives and all writ of summons; if not, he may be coerced other persons who, owing to their status by the investigating judge, who, to that or profession, obtain knowledge of secrets end, after hearing the opinion of the public entrusted to them and disclose them other- prosecutor, and subject to no other formal- wise than if called upon to give evidence in ity, time-limit or appeal, may impose a fine legal proceedings or before a parliamentary of up to 100 francs and may order the committee of inquiry or unless required to person summoned to be physically obliged disclose them by law, shall be liable to to come and deliver his testimony'. 5 imprisonment of eight days to six months and a fine varying from 20 000 to 200 000 francs.' 3 — Sec the order for reference (p. 4) and the written observa- tions of the Kingdom of Belgium (paragraphs 41 and 42). 4 — Cass., 25 October 1978, Pas., 1979,I, 237. 5 — The current maximum fine provided for in Article 80 of the 6 — Cass., 10 July 1916, Pas., 1917,1, p. 195. Code of Criminal Procedure is BEF 20 000 (see the written 7 — Written observations of the Kingdom of Belgium (paragraph observations of the Kingdom of Belgium, paragraph 45). 44).

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7. In contrast to Belgian law, Luxembourg 6. Anyone bound by the obligation to law imposes an obligation of professional maintain secrecy referred to in para- secrecy on persons engaged in professional graph 1 hereof, who lawfully discloses activities in the banking and financial information covered by that obligation, sectors. 8 Article 41 of the Law of 5 April shall not incur criminal or civil liability 1993 on the financial sector 9provides the on the sole ground of that disclosure.' basis for that obligation. It states:

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to persuading them to place money in 11. As part of the investigation, the refer- deposits or negotiable securities with his ring judge also wishes to hear Mr Troch as employers. In the course of his activities, he a witness. purportedly collected money from Belgian clients and transferred it to Luxembourg. He allegedly also took coupons pertaining to negotiable securities to the Grand Duchy for Belgian clients in order to place the Mr Troch is a Belgian national, resident in proceeds of those coupons with his Luxembourg, who worked at the BUCL employer. The disputed facts concern the where he was in charge of the arbitrage period from October 1993 to May 1999. office, investment funds, international credits and private banking. Mr Troch has already been questioned by the Belgian police. However, he refused to answer the questions put to him, invoking the provi- sions of Luxembourg law relating to bank- ing secrecy.

10. In the course of the investigation, the referring judge questioned Mr der Weduwe on the manner in which he prospected for 12. The referring judge states that Mr der clients and the manner in which the negoti- Weduwe and Mr Troch have not, at any able securities were transferred to Lux- time, invoked their right to remain silent. embourg. They have expressly based their refusal to answer questions on Luxembourg banking secrecy. 11

and the provisions of Luxembourg law recipients located in another Member prescribing an obligation of professional State. 14 secrecy. That situation gravely impedes the proper operation of the Belgian judicial system because, in order to avoid liability for breach of banking secrecy, Luxembourg bankers prefer to refuse to give evidence in Belgium and, accordingly, to incur a fine under Article 80 of the Belgian Code of Criminal Procedure. 16. The referring judge considers that, in the present case, the extraterritorial validity of the Luxembourg banking secrecy laws constitutes an 'unreasonable impediment' to the free provision of financial services. 15 He explains that Luxembourg bankers who exercise their right to provide services freely on Belgian territory find themselves 14. In those circumstances, the referring confronted with a dilemma since they must judge is uncertain whether Article 59 of the necessarily act in contravention of either EC Treaty (now, after amendment, the Belgian legislation concerning the obli- Article 49 EC), which prohibits restrictions gation to give evidence (Article 80 of the on freedom to provide services within the Code of Criminal Procedure), or the Lux- European Community, does not preclude embourg rules on banking secrecy (Ar- the Luxembourg legislation on banking ticle 41 of the 1993 Law). According to secrecy from having extraterritorial scope. the referring judge, that conflict of law also results in unequal treatment of banks and clients depending on their nationality and place of establishment.

where a credit institution authorised in a Member State in which breaches of bank- ing secrecy are a criminal offence operates, under the freedom to provide services, in another Member State where there is no analogous banking secrecy, (3) that provision precludes a legislative provision of the Member State of origin pursuant to which employees of the credit institution concerned may be rendered criminally and civilly liable (1) that provision of the Treaty does not if, in the context of a criminal investi- preclude a legislative provision of the gation conducted in a host Member host Member State pursuant to which State (see points 1 and 2) (in this case employees of the credit institution Belgium), they give evidence concern- concerned are required to give evidence ing services provided by them in the in criminal proceedings concerning ser- territory of the host Member State vices provided by them, under the under the freedom to provide services; freedom to provide services, in the territory of the host Member State in circumstances in which employees of credit institutions of the host Member State are under a like obligation to give evidence as witnesses;

(4) that provision precludes a legislative provision of the Member State of origin pursuant to which employees of the credit institution concerned may be (2) that provision does not preclude a rendered criminally and civilly liable legislative provision of the host if, in the context of a criminal investi- Member State pursuant to which gation conducted in a host Member employees of the credit institution State (see points (1) and (2); in this case concerned who, when interviewed as the Kingdom of Belgium), they make a suspects, choose not to rely on their statement as suspects concerning ser-

21. In the course of the written procedure, three interveners submitted observations to the Court: Mr der Weduwe, the Kingdom 19. The first set of questions relates to the of Belgium and the Commission of the Belgian legislation on giving evidence in European Communities. legal proceedings. The referring judge asks whether Article 59 of the Treaty permits a host Member State to apply a national provision requiring persons engaged in professional activities in the banking sector, who are summoned as witnesses in the 22. Mr der Weduwe submits that the course of a judicial investigation, to dis- reference for a preliminary ruling is inad- close information covered by an obligation missible. He advances three lines of argu- of professional secrecy under the laws of ment in support of his contention. their Member State of origin. 16 The refer- ring judge also asks whether Article 59 of the Treaty precludes such a provision in 18 — In the third and fourth questions, the referring judge distinguishes between whether the Luxembourg banker is cases where the persons concerned are summoned to appear as a witness or as a suspect. However, that distinction is clearly inconsistent with the summoned as suspects and do not invoke grounds of the order for reference. In his order for their right to remain silent. 17 reference (p. 3), the investigating judge points out that, under Belgian law, the situation of the witness 'applies, mutatis mutandis, to the Luxembourg banker who is suspected of an offence and chooses not to rely on his right of silence'. In those circumstances, the third and fourth questions must be understood as referring exclusively to 16 — First question. the situation of a Luxembourg banker summoned to 17 — Second question. appear as a witness.

Second, the questions referred to the Court do not have to be answered in order to settle the case. In so far as the referring judge is not required to give 'judgment' within the meaning of Article 234 EC, the Court's ruling would only serve as pre- ventive legal advice for the public pros- By contrast, the Belgian Government con- ecutor's office and, as the case may be, the siders that, were the Luxembourg legis- trial courts before which the case is lation to have extraterritorial validity, 23 it brought. 20 would be contrary to Community law. If that were the case, the Luxembourg laws on banking secrecy would be discrimina- tory and liable to obstruct the free provi- sion of services in Belgium. Persons engaged in professional activities in the banking sector would find themselves in an impossible legal situation, since they could Third, the order for reference does not not at the same time respect both the adequately describe the factual and legal obligation to give evidence prescribed by background to the questions. 21 Belgian law and the obligation of profes-

22 — Written observations of the Kingdom of Belgium (para- 19 — Written observations of Mr der Weduwe (pp. 2 to 5 of the graphs 60 to 83). French version). 23 — On the issue of the extraterritorial validity of the 20 — Ibid. (p. 5 of the French version). Luxembourg legislation, see paragraphs 38 to 48 of this 21 — Ibid. (pp. 5 to 9 of the French version). Opinion.

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sional secrecy imposed on them by Lux- 25. The Luxembourg Government did not embourg law. Moreover, the Luxembourg make an intervention in the written pro- legislation is not justified by any overriding cedure. Instead, it submitted oral observa- reason of public policy, within the meaning tions, to which I will return in the course of given to that term by the case-law. 24 this Opinion.

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sequently, where the questions submitted essential for the national court to explain by the national court concern the inter- the reasons why it considers that a reply to pretation of Community law, the Court of its questions is necessary. 34 Justice is, in principle, bound to give a ruling. 2 9

tions. 32 applicable to the dispute in question. 36 It also refuses to give a ruling where its answer would not have any bearing on the main proceedings 3 7 or where the inter- pretation sought has no relevance to the outcome of the dispute. 3 8 Finally, the 28. The Court also considers that, in order Court refuses to give a preliminary ruling to be able to give an interpretation which where it is not certain that the national proves useful to the resolution of the case at issue, it is advisable that, prior to making the reference, the national court establish 34 — See, inter alia, Joined Cases 98/85, 162/85 and 258/85 the facts in the case and settle any questions Bertini and Others [1986] ECR 1885, paragraph 6. of purely national law. 33 Similarly, it is 35 — Foglia, cited above, paragraph 18; Case C-18/93 Corsica Ferries [1994] ECR I-1783, paragraph 14:

graph 21. C-361/97 Nour [1998] ECR I-3101, paragraph 15. 31 — Ibid., paragraph 20. See, also, Case C-378/93 La Pyramide 36 — See, inter alia, Case 54/72 FOR v VKS [1973] ECR 193, [1994] ECR I-3999, paragraph 11. paragraph 9; Case 51/74 Van der Hulst [1975] ECR 79, 32 — See, inter alia, Foglia, cited above, paragraph 18; Case paragraphs 38 to 42; and Case 172/84 Celestri [1985] ECR 149/82 Robards [1983] ECR 171, paragraph 19 and Case 963, paragraphs 12 to 16. C-458/93 Saddik [1995] ECR I-511, paragraph 17. 37 — Grado and Bashir, cited above, paragraphs 15 and 16. 33 — See, inter alia, Joined Cases 36/80 and 71/80 Irish 38 — See, inter alia. Case C-343/90 Lourenço Dias [1992] ECR Creamery Milk Suppliers Association and Others [1981] I-4673, paragraphs 22 and 23 and Case C-297/93 Grau- ECR 735, paragraph 6. Hupka [1994] ECR I-5535, paragraph 18.

32. The referring judge assumed that the Luxembourg legislation has a specific extraterritorial effect. In his view, the 1993 Law prohibits Luxembourg bankers from disclosing information covered by banking In such a case, the referring judge is secrecy to the judicial authorities of required to identify and interpret legal another Member State. provisions which do not form part of his own legal system. In contrast to his pos- ition in the 'classic' preliminary reference 39 — Case C-83/91 Meilicke [1992] ECR I-4871, paragraphs 27 procedure, the referring judge seldom has to 30; Centro Servìzi Spediporto, cited above, paragraphs direct and exhaustive knowledge of the 43 to 46; Case C-134/95 USSL No 47 Di Biella [1997] ECR I-195, paragraphs 13 to 16 and Monin Automobiles, national law applicable to the dispute. cited above, paragraphs 13 to 15. Consequently, in my view, the Court of 40 — Contrary to the requirements established by the case-law (Bertini, cited above, paragraph 6; Lourenço Dias, cited Justice 'must display special vigilance above, paragraph 19 and La Pyramide, cited above, paragraph 13), the referring judge has not explained why he considers that an answer to the first two questions is necessary to decide the case. On the contrary, it appears from the grounds of the order for reference that the 41 — See, inter alia, Case 6/64 Costa v ENEL [1964] ECR 565, investigating judge is essentially — if not exclusively — page 593; Case 5/77 Tedeschi v Denkavit [1977] ECR concerned with whether the Luxembourg legislation on 1555, paragraph 17; Case 104/77 Oehlscbläger [1978] banking secrecy complies with Community law (see ECR 791, paragraph 4; Case C-235/95 Dumon and paragraphs 13 to 16 of this Opinion). In those circum- Froment [1998] ECR I-4531, paragraph 25 and Joined stances, it is not clear that the first two questions can be Cases C-175/98 and C-177/98 Lirussi and Bizarro [1999] declared admissible. However, since I advise the Court to ECR I-6881, paragraph 37. declare all the questions inadmissible on other grounds (see 42 — See, inter alia, Case C-177/94 Pertili [1996] ECR I-161, paragraphs 35 et seq. of this Opinion), it is not necessary paragraphs 10 to 19 and paragraphs 16 and 17 of my to discuss that point in any greater detail. Opinion in that case.

37. The Kingdom of Belgium points out According to the second interpretation, the that both Article 41 of the 1993 Law and Luxembourg legislation has an extraterri- Article 458 of the Luxembourg Criminal torial effect with regard to both the prin- Code provide for an exception to the ciple of banking secrecy and to exceptions obligation of professional secrecy. Under to that principle. On that interpretation, those provisions, banking secrecy can be set bankers established in Luxembourg have a aside where the banker is called upon to duty to respect banking secrecy not only on give evidence in legal proceedings, or where 44 — Written observations of the Kingdom of Belgium (para- graph 51). 43 — Foglia, cited above, paragraph 30. 45 — Ibid, (paragraphs 52 to 59 and 84 to 92).

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DER WEDUWE

On the first interpretation, the principle of banking secrecy does not apply on Belgian territory. In those circumstances, Mr der Weduwe and Mr Troch are free to testify Finally, according to the third interpre- before the investigating judge at Turnhout. tation, the Luxembourg legislation has an Similarly, on the second interpretation, the extraterritorial effect only in so far as the obligation to give evidence prescribed by principle of banking secrecy is concerned. Article 80 of the Code of Criminal Pro- That would mean that bankers established cedure is a ground which justifies waiving in Luxembourg have a duty to respect the the obligation of banking secrecy. In that obligation of banking secrecy outside Lux- case, Mr der Weduwe and Mr Troch are embourg territory. However, they are not also free to testify before the investigating authorised to disregard the rules on bank- judge at Turnhout. ing secrecy when they are called upon to give evidence before the judicial authorities of another Member State. They are per- mitted to disclose information covered by banking secrecy solely to the Luxembourg judicial authorities. 46 41. The Kingdom of Belgium observes that if either of those two interpretations were to be accepted, the preliminary reference by 46 — It must be borne in mind that, in his order for reference, the investigating judge at Turnhout did not refer to the controversy regarding the extraterritorial effect of Lux- embourg law. He also did not explain his decision to base 47 — Written observations of the Kingdom of Belgium (para- his questions on the third interpretation of the Lux- graphs 59, 87 and 90). embourg laws on banking secrecy. 48 — Ibid, (paragraphs 90 and 91).

47. First, the Luxembourg Government submits that the principle of banking secrecy does have extraterritorial scope. In its view, the Luxembourg legislation would 44. At the hearing, the Grand Duchy of be totally ineffective if it permitted persons Luxembourg stated that its national courts to disclose information covered by banking have not yet resolved the issue of the secrecy outside the territory of the Grand extraterritorial effect of banking secrecy. Duchy. In that case, bankers would only have to leave Luxembourg territory to be able to disclose with impunity information 49 — Ibid, (paragraph 92). which would otherwise be covered by 50 — Ibid, (paragraph 88). banking secrecy. It follows that, subject to

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DER WEDUWE

the exceptions provided for by Lux- Luxembourg Criminal Code and Article 41 embourg law, the disclosure of information of the 1993 Law. 52 The Luxembourg covered by banking secrecy outside the Government considers that accepting that territory outside the territory of the Grand interpretation would be tantamount to Duchy constitutes an offence liable to accepting that one State may establish criminal prosecution by the Luxembourg exceptions to the criminal laws of another authorities. 51 State. According to the Grand Duchy of Luxembourg, such an interpretation would be in clear conflict with the general prin- ciples of international criminal law.

49. It follows from all the foregoing obser- 51 —The Luxembourg Government stated that the legal basis vations, that the questions referred to the for the prosecution of that offence is Article 7b of the Luxembourg Code of Criminal Procedure. That provision Court by the investigating judge are based states that: 'where any act constituting an essential element of an offence is carried out in the Grand Duchy of Luxembourg, that offence is deemed to be committed on the territory of the Grand Duchy of Luxembourg'. The Luxembourg Government explained that, pursuant to that 52 — See paragraph 38 of this Opinion (see, also, the written provision, it is not necessary that all the essential elements observanons of the Kingdom of Belgium, paragraph 39). of the offence are committed in Luxembourg in order for 53 — In fact, the Luxembourg Government stated that the term the offence to incur criminal sanctions in Luxembourg. It is 'judicial authorities' includes all foreign judicial authorities only necessary for one of the essential elements to be committed in Luxembourg. As regards banking secrecy, provided that they are deemed to be 'equivalent' to the Luxembourg judicial authorities, in the light of the one of the essential elements of the offence is obtaining principles of the rule of law and the separation of powers. knowledge of the information covered by banking secrecy. The Luxembourg Government also, however, explained In so far as that knowledge is obtained in an establishment that as far as the judicial authorities of other Member located in Luxembourg, it is irrelevant to the prosecution States are concerned, that condition is clearly met on of that breach of banking secrecy that the disclosure of that account of the institutional guaranties provided by mem- information took place outside Luxembourg territory. bership of the European Union.

5 3 . In the light of the foregoing, I propose that the Court declare:

The questions referred by the investigating judge at the Rechtbank van eerste aanleg te Turnhout (Belgium) are inadmissible.

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