EHRM, 14-03-2013, nr. 24117/08

The applicant companies maintained that the wording of section 4–10 (1) of the Tax Assessment Act indicated that the tax authorities were empowered to demand access to a company's business premises for tax audit purposes and to review the company's archives on site. However, their order to hand over a backup tape on which all or most of the companies' documents were kept had greatly exceeded the wording of that provision, from which no such power could be deduced. Nor could any support to that effect be found in case-law, the preparatory work on the legislation, legal doctrine or the tax authorities' own guidelines. As had been pointed out by the minority of the Supreme Court, the provision was limited to ‘review’; to demand copies was far more interfering. When Parliament had authorised search and seizure in 1980, it had done so in order to ensure that important documents would not be hidden or deleted. If the authorities were to be empowered to copy the archive in question, it would mean conferring on them an authority over and above the intentions of Parliament in 1984 (see paragraph 58 above). The majority of the Supreme Court had ignored that fact in supporting the argument that the tax authorities should be permitted to ‘seize’ electronic documents. The majority had interpreted section 4–10 (1) incorrectly.

In any event, it had not been foreseeable that section 4–10 (1) (b) would be invoked as a legal ground for ‘seizure’ of the entire backup tape. The present case did not concern any ‘grey areas at the fringes of the definition’ (see Cantoni v. France, 15 November 1996, § 32, Reports of Judgments and Decisions 1996-V) but a far-reaching interference clearly outside the wording of the law and what could reasonably be deduced from the relevant legal sources. A number of factors indicated that the law was not sufficiently clear and precise. The tax authorities could easily have adhered to existing requirements by conducting the search on-site, limiting it to what was relevant for tax assessment purposes, and requiring the production of any documents necessary for those purposes. The fact that the ‘seizure’ of the backup tape related to large amounts of data, including personal e-mails and lawyer-client correspondence, and affected the important interests of a wide group of persons, suggested a strict requirement of precision. The ‘seizure’ had been planned and executed as a ‘dawn raid’ and had been coercive in nature owing to the pressure that had been brought to bear on the applicant companies to surrender the backup tape. Since the danger of abuse had been as great as in criminal proceedings, the requirement of precision should not have been any less in the present instance. The need to keep pace with general technological and social developments could not of itself provide the requisite legal ground for the interference at issue.

The interference was even less foreseeable to Kver and I.O.R., who had merely been co-users of the server and had not been informed that a tax audit would take place. The so-called mixed-archive doctrine had been invoked only later, on 1 June 2004.

Also, despite the fact that B.L.H.'s and Kver's representatives had offered to identify the relevant parts of the server, the authorities had persisted in their demand to copy the whole server.

Against that background, the scope of the tax audit, as asserted by the tax authorities and later upheld by the Supreme Court, involving access to the whole backup tape unrestrained by the applicant companies' instructions, had been incompatible with the requirement of lawfulness in Article 8 of the Convention.

By way of general argument, the Government maintained that the domestic authorities' latitude in assessing compliance with the three sets of requirements in Article 8 § 2 should be wide when the business activities of legal persons were at issue (see Niemietz, cited above, § 31).

The interference complained of had a legal basis in Norwegian law. As held by the Supreme Court, the tax authorities' demand for a backup copy of the entire server for review at the tax office had a sufficient legal basis in section 4–10 (1) (b) of the Tax assessment Act.

Also, the quality requirement that the law be accessible had been complied with. This was undisputed by the applicant companies.

As to the requirement of foreseeability, while certainty was highly desirable, excessive rigidity should be avoided so that the law can keep pace with changing circumstances (see The Sunday Times v. the United Kingdom (no. 1), 26 April 1979, § 49, Series A no. 30).

In the view of the Government, the requirement for precision ought to be less rigorous in relation to orders to allow the inspection of records as part of a tax audit, than, for instance, in relation to penal provisions or coercive measures associated with criminal procedures (see Sallinen and Others, cited above, § 90). Orders pursuant to section 4–10 (1) of the Tax Assessment Act did not require any suspicion of criminal offences, and the tax authorities were not empowered to enforce an order against the will of the taxpayer. The requirement of precision should be construed less strictly in relation to the procedural aspects of a section 4–10 (1) measure than in relation to the conditions for its application.

The Government contended that the second and third applicants had been able to foresee — if need be with appropriate advice — that by not keeping their electronic records clearly separated from those of other companies, they had run the risk of having them examined in connection with a tax audit of one of the other companies. The purpose behind the provision in section 4–10 (1) (b) of the Tax Assessment Act, as clearly indicated by the relevant preparatory discussions on the legislation, had been introduced because the tax authorities should not be dependent on indications by the taxpayer for identifying the files relevant to the audit.

The Tax Assessment Act had been drafted before the advent of electronic records. At the time, it was natural to assume that an examination of records would be conducted on the taxpayers' premises, since that was where the records were located. In contrast, the development of technologies for copying servers meant that it would often be more practical for all parties involved to make copies of electronic records for subsequent inspection at the tax office. Owing to the large amounts of data contained on many computer servers, on-site inspection would be very time-consuming. The tax authorities would have difficulty in carrying out effective audits if they were denied the possibility of copying electronic records.

The wording of section 4–10 (1) (b) interpreted in the light of the purpose of an effective tax audit and having regard to the changed circumstances as a result of technological innovation, was sufficiently precise to enable the applicant companies to foresee — with appropriate advice — that the tax authorities could demand that a backup copy be taken of the electronic records.

As legal persons carrying out a professional activity and used to having to proceed with a high degree of caution (see Cantoni, cited above, § 35), the applicant companies could be expected to have taken special care in assessing the risks that such an activity entailed. At the time, the tax authorities would frequently demand that copies be made of electronic records in connection with tax audits. It must be assumed that tax advisors would have been familiar with that practice. The applicant companies' contention that the tax authorities had made similar demands to other companies on a number of previous occasions supported the assumption that the applicant companies, at the material time, could have foreseen that an order to allow the inspection of records could have included the taking of a backup copy of any electronic records.

In any event, with the benefit of appropriate legal advice, the applicant companies should have appreciated at the material time that there was a risk that an order to allow the inspection of records would include a demand to take a backup copy of their electronic records.

The Court reiterates that, according to its well-established case-law, the words ‘in accordance with the law’ require the impugned measure both to have some basis in domestic law and to be compatible with the rule of law, which is expressly mentioned in the preamble to the Convention and inherent in the object and purpose of Article 8. The law must thus be adequately accessible and foreseeable, that is, formulated with sufficient precision to enable the individual — if need be with appropriate advice — to regulate his conduct (see, among other authorities, S. and Marper v. the United Kingdom [GC], nos. 30562/04 and 30566/04, § 95, ECHR 2008, with further references). In The Sunday Times (cited above, § 49), the Court held — in relation to Article 10 — that a citizen

Moreover, in Gillan and Quinton (cited above), the Court held:

Also on the issue of foreseeability, it may be reiterated that in Cantoni (cited above), the Court stated (in examining a matter under Article 7):

Turning to the present case, the Court will first consider whether the interference had a sufficient legal basis in domestic law. It notes that section 4–10 (1) (a) of the Tax Assessment Act specified the nature of documents which the tax authorities were empowered to order the taxpayer to ‘present, hand out or dispatch’ — namely those ‘of significance with respect to the tax assessment of the taxpayer and the inspection thereof’. Under sub-paragraph (b), the same authorities could order the taxpayer ‘[t]o grant access for on-site inspection, survey, or review of the companies' archives …’. For the reasons expounded by the Supreme Court in its judgment (see paragraphs 40–42 above), the Court sees no reason to question its interpretation that, having regard to the purpose of those provisions, electronically stored documents were also covered by sub-paragraph (a) (see similarly Wieser and Bicos Beteiligungen GmbH, cited above, §§ 53–54).

The Court also notes that access pursuant to sub-paragraph (b) extended to all archives potentially containing information of importance for the tax assessment. Had the archive been organised with clear dividing lines between the different companies, the tax authorities could have identified the areas on the server where relevant information could have been found. To allow the authorities to access the entire server would therefore have been consistent with the above-mentioned purpose (see paragraphs 41–48 above). So would, in the view of the Supreme Court majority, a requirement enabling the authorities to obtain copies of documents where a review of those copies appeared expedient. Nothing in the relevant rules prevented either such copying (see paragraphs 51 above) or the taking of a backup copy of the server to the tax authorities' premises for review there (see paragraphs 51–55 above). Although the minority in the Supreme Court had considered the latter points differently (see paragraphs 57–60 above), the Court is prepared to accept that the impugned interference had a legal basis in national law.

As regards the other requirements derived from the notion ‘in accordance with the law’, it was undisputed that the law in question was accessible and the Court sees no reason to hold otherwise. On the other hand, the parties disagreed as to whether it had been foreseeable.

The main issue in the instant case relates to the fact that by taking a backup copy containing all the existing documents on the server, the tax authorities had obtained the means of accessing great quantities of data which did not contain information of significance for tax assessment purposes and which thus fell outside the remit of section 4–10 (1). That included private documents and correspondence of employees and other persons working for the companies, and confidential commercial information pertaining to the companies themselves and other companies; in other words, documents which affected the rights and interests of individuals and companies that were protected by Article 8 of the Convention.

The Court first observes that the purpose of a measure taken under sub-paragraph (b) was, as explained by the Supreme Court, to give the tax authorities a basis for assessing whether the tax subject possessed documents which they could require the latter to furnish pursuant to sub-paragraph (a). It was not limited to accountancy documents but extended to all documents that might be relevant to the tax assessment (see paragraph 41 above). Considerations of efficiency of the tax audit suggested that the tax authorities' possibilities to act should be relatively wide at the preparatory stage (see paragraph 42 above). The tax authorities could therefore not be bound by the tax subject's indications as to which documents were relevant, even where the archive in question comprised documents belonging to other tax subjects. However, although the scope of a section 4–10 (1) order was potentially very wide, it did not confer on the tax authorities an unfettered discretion, as the object of such an order was clearly defined in statute.

Thus the authorities could not require access to archives belonging entirely to other tax subjects. Where the archive belonged to the tax subject concerned, access could not be demanded to documents belonging to other tax subjects in order to obtain information about them, unless the documents contained information relevant to the tax assessment of the tax subject in question.

Furthermore, where several businesses shared archives and their respective parts of the archives were clearly separated, access should be limited to the area of the tax subject concerned. The Court sees no reason for disagreeing with the Supreme Court's finding that the archives at issue were not clearly separated but were so-called ‘mixed’ archives. It could therefore reasonably have been foreseen that the tax authorities should not have had to rely on the tax subjects' own indications of where to find relevant material, but should have been able to access all data on the server in order to appraise the matter for themselves.

In the light of the above, the Court considers that the national administrative authorities' and the courts' interpretation and application of section 4–10 (1) as a provision authorising the taking of a backup copy of the server with a view to inspection at the tax authorities' premises were reasonably foreseeable by the applicant companies in the circumstances. Any measures taken to that end ought to adhere to the above-mentioned limitations, as they transpired from the Supreme Court's reasoning.

Against that background, the Court is satisfied that the law in question was accessible and also sufficiently precise and foreseeable to meet the quality requirement in accordance with the autonomous notion of ‘lawfulness’ under paragraph 2 of Article 8.

In the applicant companies' submission, the reasons relied on by the Supreme Court were only partly relevant and certainly not sufficient to convincingly establish that the ‘seizure’ of the backup tape in their case was necessary in a democratic society.

The Supreme Court's majority had failed to sufficiently emphasise the broadness of the measure as described above, and the fact that a significant part of the information had been irrelevant for tax audit purposes. The minority had rightly pointed to considerations pertaining to ‘sensitive personal information’ and to the fact that the ‘seizure’ (in the applicants' submission) of a backup tape, as opposed to paper archives, entailed a risk of abuse through the use of advanced search tools and rapid copying and spreading of sensitive information. In so far as Kver and B.L.H. had been forced by the tax authority to ‘consent’ to handing over the backup tape, the measure could even be regarded as an affront to the privilege against self-incrimination.

The Supreme Court's majority had also wrongfully distinguished between the administrative investigations at issue in the present case and criminal investigations. The applicant companies would in fact have enjoyed far more extensive procedural guaranties had the ‘seizure’ in their case been carried out pursuant to the Code of Criminal Procedure, including a hearing before an impartial tribunal considering the proportionality of the measure in concreto.

Whilst the Supreme Court had emphasised that the tax authorities' decision to ‘seize’ the backup tape could not be enforced, it had disregarded the coercive nature of a section 4–10 (1) (b) order and the Government's shifting position on the matter during the domestic proceedings. Indeed, until the proceedings before the Supreme Court, the Government's position had been that such an order was enforceable.

Sections 3–5 and 3–6 (4) of the Tax Assessment Act did not provide effective safeguards against abuse. The affected companies had had no means of controlling the access and review of the backup tape in general. A minimum requirement should therefore be that the backup tape, when not subject to review, should be deposited with an independent third party.

The alleged safeguards provided to B.L.H., and particularly to the other two applicant companies, had been full of loopholes and had fallen foul of the requirements in Article 8.

The Supreme Court had not been in a position to properly assess the alleged difficulties with respect to on-site reviews and the purported need to obtain a backup copy of the server. It had had no sources of information other than the assertions made by the tax authorities themselves. Whilst in most cases it would probably be more convenient for the tax authorities to carry out a review on their own premises, their affirmation that an on-site review had been difficult was open to question. Since the introduction of computers and electronic archives, the use of search software must surely have facilitated the task of the tax authorities compared with the review of traditional paper archives. It should also be noted that pursuant to section 4–10 (3) of the Tax Assessment Act, the taxpayer was obliged to assist the tax authorities in their review.

It was unclear to the applicant companies whether it was through necessity or convenience that less than ten percent of on-site tax audits and archival reviews resulted in ‘seizures’ of electronic documents, and that in the remaining ninety percent of cases, the tax authorities found it sufficient to review the archives on-site. The risk of abuse and arbitrariness appeared obvious.

The Supreme Court's ruling had meant that a section 4–10 (1) (b) order was acceptable also where the affected company (namely the company whose archive was ‘seized’) was not the subject of a tax audit or similar inspection. By invoking the mixed-archive doctrine, that is, the argument that the different archives were not distinguishable, the tax authorities in effect had the discretion to demand a copy of an entire server containing several different archives.

The Supreme Court's ruling had also left room for considerable legal uncertainty with respect to the scope of the powers conferred on the tax authorities. As illustrated by the tax authorities' demand that Kver provide copies of ‘all electronically stored information’ (see paragraph 13 above), considerations of efficiency and control would have to be strongly invoked in order to justify a very wide interpretation of the concept of ‘company archive’ in section 4–10 (1) (b).

Despite the fact that the imposition of a section 4–10 (1) (b) order was not subject to any conditions or qualifications — not even the existence of suspicion that an offence or wrongdoing had been committed — the tax authorities were empowered to demand the ‘seizure’ of an entire server backup tape. This state of affairs of itself rendered the measure disproportionate and incompatible with Article 8 of the Convention.

Moreover, unlike decisions by public authorities generally (see section 25 of the Public Administration Act — ‘forvaltningsloven’), the tax authorities were under no obligation to give reasons for their decision to impose a section 4–10 (1) (b) order (section 1–2 of the Tax Assessment Act).

A prior judicial authorisation was not a prerequisite for issuing a section 4–10 (1) (b) order and had not been issued in the applicant companies' case. Nor had they been afforded an effective complaints procedure or legal remedies, the procedure under section 3–6 of the Tax Assessment Act being illusory. The Supreme Court's judgment of 20 November 2007 had left very little room for complaints. In essence, it had implied that there had been no need for the tax authorities to give any particular reason as to why the ‘seizure’ was taking place. In cases where several companies shared the same server, the tax authorities could invoke the ‘mixed-archive doctrine’ at their own discretion. The judgment apparently left no scope for effective judicial review of the proportionality and necessity of a ‘seizure’ in a specific case.

In the Government's opinion, the reasons adduced to justify the measure in the present case were relevant and sufficient. Orders pursuant to section 4–10 (1) (b) of the Tax Assessment Act were issued in order to ensure an effective tax audit.

Furthermore, sections 3–5 and 3–6 of the Tax Assessment Act afforded adequate and effective safeguards against abuse in relation to section 4–10 orders. According to section 3–5 (1), the taxpayer was to be given reasonable notice and have the right to be present and express his or her views at an inspection of the records. Section 3–5 (2) required a written report to be drawn up describing the factual information that had been collected. If the person concerned by the order believed that he or she was not required or legally permitted to comply with the order, a complaint could be lodged against the order (section 3–6 (1)). In the event of a complaint, section 3–6 (4) provided that an extension would be granted if the documents were sealed and deposited. Lastly, the lawfulness of the order could be challenged before the national courts.

Contrary to the assertions of the applicant companies, the fact that an order to allow the inspection of records could be issued without prior judicial authorisation did not mean that the above-mentioned safeguards were ineffective. Since a section 4–10 (1) (b) order could not be legally enforced, a requirement of prior judicial authorisation would be unreasonable. Bearing in mind that the tax authorities were not empowered to carry out an inspection if the taxpayer refused to cooperate with the order, there could be no need for prior judicial authorisation, which moreover was not an absolute requirement according to the Court's case-law (see Smirnov v. Russia, no. 71362/01, § 45, 7 June 2007, and Mastepan v. Russia, no. 3708/03, § 43, 14 January 2010).

The Government disputed that a taxpayer might be liable to punishment if he or she refused to cooperate with a section 4–10 (1) (b) order; such a possibility was only theoretical. There were no examples to the contrary nor had such measures been contemplated here.

They also disagreed that the risk of misuse of sensitive personal data would increase if backup copies were taken to the tax office rather than inspected on the taxpayer's premises. Again, they emphasised that no individuals working for the applicant companies had presented themselves as applicants before the Court; thus, any matters pertaining to their interests fell outside the scope of the case.

The measure in question was also strictly proportionate to the aim pursued. In no way could the tax authorities' decision to issue the section 4–10 (1) (b) order be viewed as arbitrary. BLH had been selected for tax audit because the tax authorities had had reason to believe that there had been a commonality of interest between B.L.H. and I.O.R. On several occasions they had asked B.L.H. to provide information concerning the transactions and the relationship between the two companies, but B.L.H. and I.O.R. had both failed to provide such information. The order to allow the inspection of records had been issued more than a year after the tax audit had been started and after the tax payer had repeatedly been asked to produce the documentation necessary to verify the information provided in the tax return. In those circumstances, it had been apparent that an on-site inspection would have been far less effective than a subsequent inspection at the tax office.

In the instant case, sections 3–5 and 3–6 of the Tax Assessment Act, together with the right to judicial review, had provided the applicant companies with adequate and effective safeguards. Indeed, after they had complained about the section 4–10 (1) (b) order, the backup copy of the server had been sealed and the applicant companies had been granted an extension pursuant to section 3–6 (4) of the Tax Assessment Act. They had been granted a further extension pending a final and enforceable judgment and, subsequent to the Supreme Court judgment, yet a further extension in connection with legal proceedings on interim relief. Thus, whilst in most cases a backup tape would within a short time be reviewed in accordance with the section 4–10 (1) (b) order, in the present case the tax authorities had been in the possession of the backup tape for almost six years and had repeatedly agreed to defer their review of the tape.

In sum, the impugned measure had been ‘necessary in a democratic society’.

In determining whether the impugned measure was ‘necessary in a democratic society’, the Court will consider whether, in the light of the case as a whole, the reasons adduced to justify it were relevant and sufficient, and whether it was proportionate to the legitimate aim pursued. In so doing, the Court will take into account that the national authorities are accorded a certain margin of appreciation, the scope of which will depend on such factors as the nature and seriousness of the interests at stake and the gravity of the interference (see, for instance, Z v. Finland, 25 February 1997, §§ 94 and 99, Reports of Judgments and Decisions 1997-I, and Leander v. Sweden, 26 March 1987, § 58, Series A no. 116).

One factor that militates in favour of strict scrutiny in the present case is that the backup copy comprised all existing documents on the server, regardless of their relevance for tax assessment purposes (see Miailhe v. France (no. 1), 25 February 1993, § 39, Series A no. 256-C, and Niemietz, cited above, § 32). On the other hand, the fact that the measure was aimed at legal persons meant that a wider margin of appreciation could be applied than would have been the case had it concerned an individual (see, mutatis mutandis, Niemietz, cited above, § 31).

The Court notes that a tax audit pursuant to section 4–10 (1) of the Tax Assessment Act complemented the duty of the tax subject to provide accurate information to the tax authorities to enable them to make a correct tax assessment (see paragraph 67 above).

The purpose of measures taken under sub-paragraph (b) of section 4–10 (1) was to enable the tax authorities to assess whether the tax subject possessed documents the production of which could be imposed under sub-paragraph (a). There is no reason to call into doubt the view held by the Norwegian Parliament when adopting those provisions that the review of archives was a necessary means of ensuring efficiency in the checking of information which tax subjects submitted to the tax authorities, as well as greater accuracy in the information so provided and in the latter's tax assessment (see paragraphs 41 and 42 above). Nor is there any reason to assume that the impugned application of section 4–10 (1) was based on any other considerations in the instant case. On the contrary, the tax authorities' justification for obtaining access to the server and a backup copy with a view to carrying out a review of its contents on their premises was supported by reasons that were both relevant and sufficient for the purposes of the necessity test under Article 8 § 2.

It remains to consider whether the interference complained of was proportionate to the legitimate aim pursued.

As stated above (see paragraph 159), the interference was particularly far-reaching in that the backup tape contained copies of all existing documents on the server, including, as was undisputed, large quantities of material that was not relevant for tax assessment purposes, inter alia, private correspondence and other documents belonging to employees and persons working for the companies (see paragraphs 10, 14, 19–20, 54 and 59 above). An important consideration in the present case, therefore, is whether the procedure relating to the authorities' obtaining access to a backup copy of the server with a view to inspecting it in the tax office was accompanied by effective safeguards against abuse.

The Court recalls the various limitations highlighted in paragraphs 122 to 129 above to the effect that that section 4–10 (1) did not confer on the tax authorities an unfettered discretion, notably with regard to such matters as the nature of the documents that they were entitled to inspect, the object of requiring access to archives and of authorising the taking of a backup tape. Furthermore, it is to be noted that B.H.L. had been notified of the tax authorities' intention to carry out a tax audit a year in advance, and both its representatives and those of Kver were present and able to express their views when the tax authorities made their on-site visit on 9 March 2004 (section 3–5 (1) of the Tax Assessment Act).

In particular, the Court observes that, not only was a right to complain available under section 3–6 (1), as soon as the first and second applicants complained about the section 4–10 (1) measure in their case — which they apparently did immediately — the backup copy was placed in a sealed envelope that was deposited at the tax office pending a decision on the complaint (section 3–6 (4) of the Act and Article 4 of the 1983 Regulations on Accountancy Audits; see paragraphs 71 and 73 above).

The Court has further taken account of the other safeguards set out in the above-mentioned regulation, notably the right of the tax subject to be present when the seal is broken, except where that would cause considerable delay (Article 4); the duty of those responsible for the audit to draw up a report (section 3–5 (2) of the Act, Article 5 of the Regulation); the right of the tax subject to receive a copy of the report (Article 6); and the duty of the authorities to return irrelevant documents as soon as possible (Article 7) (see paragraphs 71 to 75 above).

The applicant companies apparently did not complain that the tax authorities had reviewed the backup copy during the period between January and March 2006 in order to assist the police in the investigation of the criminal case involving Mr X (see paragraph 65 above). After completion of the review, all electronically stored documents were deleted and all paper documents were shredded with immediate effect. The Court sees no need for it to pronounce any view on the matter.

On the other hand, the applicant companies were concerned that the authorities had copied the contents of the backup tape to hard disk. The Court observes that from the material submitted, it transpires that this was done after 5 June 2007, the applicant companies were informed thereof on 19 June 2007 and it had been necessary in order to make it possible to open and read the files (see paragraph 63 above). Material so copied would be secured pending the further proceedings, by which time the tax authorities at two levels and both the City Court and the High Court had upheld the impugned measures as being lawful.

It was only later, after the delivery of a final judgment by the Supreme Court, that the tax authorities decided to review the material in question and thus, on 28 January 2008, notified the applicant companies of their intention to open the sealed envelope containing the tape with a view to ordering the production of documents. They informed them of the dates, time and place of the review, its object, certain preparatory processing not involving searching or opening of documents, and the identity of the companies concerned. The tax authorities also invited them to appoint a common representative to attend the preparations and the opening and review of the tape.

The Court has taken note of certain criticism expressed by the applicant companies regarding the practical measures envisaged for the viewing of the files in their representative's presence, notably their inability to watch the computer screen. However, it does not find that this gives rise to any serious cause for concern. As can be seen from the Tax Administration's letter to the applicant companies of 30 April 2008, the constraints in this respect essentially stemmed from the mixed character of the archives and were designed to accommodate the applicant companies' own wishes to respect confidentiality. Any documents selected would be listed, printed out and sorted according to company and be made accessible to the company in question for comment (see paragraph 65 above).

Furthermore, as observed by the Supreme Court, after the review had been completed, the copy would either be deleted or destroyed and all traces of the contents would be deleted from the tax authorities' computers and storage devices. The authorities would not be authorised to withhold documents from the material that had been taken away unless the tax subject accepted the measure. There is no reason to doubt that the tax authorities would follow that procedure in the applicant companies' case (see paragraph 64 above).

In the light of the above, while it is true that no requirement of prior judicial authorisation applied in the instant case (compare Funke v. France, 25 February 1993, § 57, Series A no. 256-A; Crémieux v. France, 25 February 1993, § 40, Series A no. 256-B; and Miailhe, cited above, § 38), the Court is satisfied that the interference with the applicant companies' rights to respect for correspondence and home which the contested section 4–10 (1) order entailed was subject to important limitations and was accompanied by effective and adequate safeguards against abuse (see, mutatis mutandis, Klass and Others v. Germany, 6 September 1978, § 50, Series A no. 28; Leander, cited above, § 60; and Z, cited above, § 103).

It should also be observed that the nature of the interference complained of was not of the same seriousness and degree as is ordinarily the case of search and seizure carried out under criminal law, the type of measures considered by the Court in a number of previous cases (see, for instance, the following cases cited above: Funke; Crémieux; Miailhe; Niemietz; Société Colas Est and Others; Buck; Sallinen and Others; Wieser and Bicos Beteiligungen GmbH; and also Robathin v. Austria, no. 30457/06, 3 July 2012). As pointed out by the Supreme Court, the consequences of a tax subject's refusal to cooperate were exclusively administrative (see in particular paragraph 43 and also paragraphs 106 and 153 above). Moreover, the disputed measure had in part been made necessary by the applicant companies' own choice to opt for ‘mixed archives’ on a shared server, making the task of separation of user areas and identification of documents more difficult for the tax authorities (see paragraphs 46–47 above).

Having regard to the circumstances of the case as a whole, the Court finds that the impugned section 4–10 (1) measure in the instant case was supported by relevant and sufficient reasons. It also sees no reason to doubt that the tax authorities of the respondent State, acting within their margin of appreciation, struck a fair balance between the applicant companies' right to respect for ‘home’ and ‘correspondence’ and their interest in protecting the privacy of persons working for them, on the one hand, and the public interest in ensuring efficiency in the inspection of information provided by the applicant companies for tax assessment purposes, on the other hand.

Accordingly, there has been no violation of Article 8 of the Convention in the present case.