Adv. Omer Wagner, Adv. Gill Nadel
The facts of this case and the claims of the parties:
The Gottex corporation imports bathing suits. The Customs Authority filed indictments against the corporation and its managers, claiming that between the years 2003-2006, the company imported bathing suits sewn in Turkey, Romania and Bulgaria, knowing that the fabrics used for sewing the bathing suits were not of European manufacture, and therefore the finished product was not eligible, under the rules of origin, to be considered a product of European origin when imported to Israel. According to the indictment, despite this the bathing suits were imported to Israel and declared to be of European origin, and the company, allegedly evaded customs of a sum of 3.3 million NIS and VAT of a sum of 2.8 million NIS.
According to the corporation, at the time of import, its customs officials and customs representatives certified the authenticity of the declaration (regarding the origin of the bathing suits), which created a representation on which it relied, as the legal situation regarding the trade agreements was unclear. The corporation further claimed that had it not been for its complete cooperation with the customs house, the Customs Authority would not have been able to assemble the facts of the indictment. It was further claimed that the corporation paid the full extent of the customs lost by the public treasury, and that the state delayed a long period of time before filing the indictments. Inter alia, the corporation claimed that the state chose to file indictments against two of the corporation's employees but refrained from accusing other employees, and that this constitutes selective and unfair enforcement which goes against all sense of justice. In light of the above, the corporation requested that the indictment against it be cancelled based on "the defense from justice".
The state claimed that the "defense from justice" claim is accepted in particularly exceptional cases in which the state behaved unreasonably, and that this was not the case here. The state claimed that at the time of import the state could not have known that the declaration given by the corporation regarding the origin of the goods was inaccurate, and that the corporation was the one who had the full information regarding the origin of the fabrics.
The state additionally claimed that any negotiation conducted with the corporation related exclusively to the civil proceeding (the customs deficiencies) and not the criminal trial. In addition, the state claimed that in light of the information in the case, the accused (the corporation and its managers) acted with full knowledge of their deeds and evaded customs and there is no reason to cancel the indictment. The state further claimed that the case included a large amount of material and offences for many years and a large scope, and filing indictments three years after the committal of the crimes does not constitute a delay, in light of this fact.
The Court's Decision:
The court reiterated the rule that a defendant's claim to cancel an indictment based on a "defense from justice" will be accepted only in exceptional cases, when a fair trial cannot be guaranteed or when conducting the proceeding will significantly harm the sense of justice.
The court noted that the defendants did not present any justification why the claim should be received in their case, and added that the place for the defendant's claims will be in the arguments for leniency in punishment (if they are convicted). The court emphasized that the duty to clarify the legal situation and the rules of origin regarding imported goods applies to the importer and not the Customs Authority.
Furthermore, the court ruled that in light of the severity of the crimes, the length of time that they were committed and their scope, filing the indictments three years after the crimes is not an exceptional delay.
In the end, the defendants’ request that the indictments be cancelled was rejected and the trial continued as usual.
(Judge Irit Weinberg-Notovitz, CA 2319/09 State of Israel- Law Office for Customs and VAT Branch v. Gottex Models Corporation Ltd. et al, decision given 26.9.10, names of advocates not noted in decisions.)
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