EU to rule on Italy's false accounting law change

The European Union’s High Court is set to deliver a ruling today on changes to Italian law which have helped Italian Prime Minister Silvio Berlusconi avoid charges of false accounting.

Italian prosecutors asked the European Court of Justice to decide if 2002 amendments to Italy’s legal system are compatible with EU legislation.

Under the revised law, false accounting became a misdemeanour instead of a felony in Italy, with a maximum four-and-a-half-year statute of limitations on prosecutions. That would rule out charges relating to Berlusconi’s business activities in the 1980s.

A court in Milan suspended a false accounting case against Berlusconi in 2002 while it waited for the European ruling.

In October, a senior adviser to the court, Advocate General Juliane Kokott, ruled the Italian law failed to satisfy EU requirements of “appropriate penalties” for false accounting.

The full court follows the advocate general’s opinion in about 80% of cases.

“Where a more lenient criminal law adopted after the event is incompatible with the requirements of (EU) law, the national courts are obliged to give priority to the application of (EU) law and not to apply the more lenient criminal law,” Kokott said.

The changes in Italian law affected several cases that were being tried at the time, including the one that sees Berlusconi and his aide, Marcello Dell’Utri, accused of falsifying the reports of Fininvest SpA, the cornerstone of the premier’s media empire.

Prosecutors allege Fininvest hid the revenues of its advertisement unit, Publitalia, and that the company illegally moved millions of lira abroad during the late 1980s.

Berlusconi has faced several cases related to his business empire since he launched a political career a decade ago.

In previous trials, he has been acquitted, or his convictions have been reversed on appeal or annulled, because the statute of limitations had run out.