Top EU Court Punts Immunity Case of Former Anti-Fraud Chief

LUXEMBOURG (CN) — Europe’s highest court on Thursday sent back to a lower court a dispute over immunity in a complicated political scandal involving Swedish smokeless tobacco, a Maltese circus owner and millions of dollars in bribes.

The decision of the European Court of Justice, which is not available in English, found that the lower court erred in its decision to side with the former head of the European Union’s anti-fraud office, Giovanni Kessler, whose immunity from prosecution had been rescinded by the European Commission following Belgian allegations of illegal wiretapping. 

Thursday’s ruling is the latest in a political intrigue saga dating back to 2012, when Maltese politician John Dalli either resigned from or was forced out of his post as the European commissioner for health and consumer policy following allegations of bribery. 

Following an investigation by the EU anti-fraud office, known by its French acronym OLAF, Dalli stepped down. OLAF found that an associate of Dalli, Silvio Zammit, a circus owner turned political operative, demanded 60 million euros ($67 million) from Swedish Match, a producer of the smokeless tobacco product snus, to lift a ban on the product from the EU. 

Snus is such an important product in Sweden that the Nordic country fought for an exemption from an EU ban on oral tobacco when it joined the 27-member political and economic union in 1995. 

During the OLAF investigation, the then-director-general, identified as RQ in court documents, allegedly listened in to a conversation with a witness in the investigation who contacted another witness via speakerphone. The information wasn’t used in the investigation, but Kessler’s actions would be a violation of Belgian wiretapping laws, which comes with a two-year jail sentence.  

Complicated regulations that govern OLAF to ensure independence made it nearly impossible to fire Kessler, who continued to serve in his role until accepting a post in his native Italy in 2017. Those same regulations also allowed him to take legal action against the commission, which he did by filing a lawsuit over the immunity issue in 2018. 

Belgium became aware of the alleged wiretapping as a result of lawsuits filed by Dalli, but all EU officials are granted legal immunity from prosecution. In 2014, Belgium, where OLAF’s offices are located, requested that the EU rescind Kessler’s immunity so they could investigate, but that was denied twice. The commission dragged its feet for a year after a third request was made, before lifting the immunity in 2016. 

The Court of Justice’s lower court, the European General Court, sided with Kessler, but the European Commission appealed.

The high court sided with the commission, the EU’s executive branch, in Thursday’s ruling and held that the right to immunity is not granted in the interest of the person with the immunity, but in the interest of the EU. 

It referred the case back to the lower court for reconsideration. The five-judge panel agreed with Kessler that “the commission did not respect [Kessler]'s right to be heard before the contested decision was adopted,” but said it wasn’t clear that it would have made a difference if he had been heard. 

The person for whom the scandal is named, Dalli, denied he had any knowledge of the bribe. He brought a complaint about his resignation controversy to the court in 2015, which he lost initially and again on appeal. Then he brought a second suit, this time demanding 1 million euros ($1.1 million) in damages, which was also rejected by the court, making Thursday’s decision the fifth ruling from the EU’s high court in the scandal. Dalli has since been connected to a fraud scheme in Malta. 

The case now returns to the General Court for another decision. 

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