Τhe ECJ sitting as a Grand Chamber on 2 nd February 2021 ruled on the no. C-481/2019 preliminary ruling reference DB versus Commissione Nazionale per la società e la Borsa (Consob) that a natural person, against whom an administrative investigation is being conducted on privileged information abuse, has the right of silence when his answers may inflict liability for violation punishable either by administrative sanctions, of criminal nature, however, or by direct criminal liability.

In the under-judgment case, in May 2012 the National Capital Market Commission of Italy (Commissione Nazionale per le Società e la Borsa – (Consob) imposed on DB for a certain administrative offense concerning the abuse of privileged information received in 2009, a pecuniary penalty amounting to a total amount of 300.000 euro.

The above person, being summoned as being aware of the material facts, to give explanations, he repeatedly asked the adjournment of the hearing and, finally, when appeared at the hearing, he declined to answer to the addressed to him questions. As a result of his refusal, a fine of 50.000 euro was imposed on him.
DB lodged an appeal against these sanctions and following its dismissal, he turned against the dismissing decision before the Supreme Court of Cassation (Corte suprema di cassazione). Finally, on 16.2.2018, he brought before the Constitutional Court of Italy (Corte Costituzionale) incidental issue of constitutionality regarding a provision of the Italian law, based on which the sanction was imposed due to non-cooperation of the applicant. The said provision stipulated the imposition of sanctions for the non-timely compliance with the National Capital Market Commission requests or for causing a delay in the exercise of the supervisory duties of the latter, even to the detriment of the person charged for the offense of the privileged information abuse.

More specifically, the Constitutional Court, noting that according to the Italian law, the privileged information abuse is both an administrative and a criminal offense, pointed out that the provision in question was enacted in implementation of the country’s obligation, as such was imposed by Directive 2003/6/EC of the European Parliament and of the Council dated 28 January 2003 on the acts of persons who possess confidential information and the market manipulation acts (market abuse), namely, par. 3 of article 14 in combination with article 30, par.1 item b’ of (EU) Regulation 596/2014 of the European Parliament and of the Council, dated 16 April 2014, on the market abuse (regulation on the market abuse) and the repealing of Directive 2003/6 and of the Commission directives
2003/124/ΕC, 2003/125/ΕC and 2004/72/ΕC. 

This finding gave raise to a question he addressed to the ECJ on the compatibility of these provisions with the Charter of Fundamental Rights of the European Union (CFE) and, in particular, with the right to silence. The ECJ in his above decision initially recognized to natural persons the right of silence, which is protected by the Charter (CFE) and ruled that both Directive 2003/6 and Regulation 596/2014 allow the member states to exercise this right within the context of an investigation conducted against such a person, which may lead to the evidence of his liability for a violation punished by administrative sanctions of criminal nature, or his
criminal liability.

Subsequently, and taking into account the ECHR case law on the right to a fair trial, it stressed that the right to silence, which is the subject matter of the concept of fair trial, prohibits, amongst other, the imposition of sanctions on a natural person, accused for to his refusal to provide answers to the competent authority by virtue of the directive or the regulation above, when these may give rise to criminal liability or violation punishable by an administrative sanction of criminal nature.
It clarified that the relevant case law which related to the obligation of companies to provide, within the context of proceedings that could lead to the imposition of sanctions for anticompetitive behaviors, information which later on could be utilized in order to substantiate their liability for such behaviors, cannot be implemented mutatis mutandis on a natural person which is accused of abusing privileged information.

However, in any case, it pointed out that the right to silence may not justify any refusal of the person concerned to cooperate with the competent authorities, such as the refusal to attend a hearing set by the said authorities or the delaying tactics aiming to the adjournment of the hearing.

In concluding, the ECHR pointed out that both Directive 2003/6 and Regulation 596/2014, being interpreted in the light of articles 47 and 48 of the CFE should be read as allowing member states to waive the imposition of sanctions to a natural person who, within the context of an investigation, declines to give to the authority in question, any answers from which may result his liability for a violation punishable by administrative sanctions of criminal nature.