Urs E. Schwarzenbach should pay a total of 10 million francs instead of a total of 8.5 million for tax evasion.
The art collector Urs E. Schwarzenbach leaves the Bülach District Court in November 2017.
The Zurich Supreme Court recently made two new judgments against the 74-year-old art dealer and Dolder owner Urs E. Schwarzenbach, or amended earlier judgments. These are written procedures without a court hearing. The decisions were announced in the media master of the higher court.
The first case concerns the conviction of multiple evasion of import tax by the Bülach district court on May 4, 2018. On June 4, 2020, the higher court reduced the lower court’s fine from CHF 4 million to CHF 2.503 million.
Schwarzenbach was convicted of smuggling 112 works of art and objets d’art into Switzerland duty unpaid. On November 12, 2021, the Federal Supreme Court upheld a complaint from the Federal Office for Customs and Border Security (BAZG) and referred the case back to the lower court for reassessment. It confirmed the opinion of the BAZG, according to which the asperation principle is not applied when determining the amount of the fine.
A complaint from Schwarzenbach was dismissed. He had asked for a full acquittal. The BAZG requested that Schwarzenbach should again be sentenced to a fine of 4 million francs. On August 12, 2022, the Second Criminal Chamber of the Higher Court nevertheless came to the conclusion that the fine set by the Bülach District Court was too high and took into account the long duration of the proceedings, noticeably reducing the penalty. In the new decision, the fine has now been set at CHF 3.098 million.
Art misdeclared in gallery
The second judgment is about the appeal against the judgment of the Zurich District Court of February 3, 2021. The 9th department had also found Urs E. Schwarzenbach, his lawyer and a gallery owner guilty of multiple tax evasion in a different situation. The 1st Criminal Chamber of the Higher Court, as the second court instance, has now largely confirmed this judgment on September 5, 2022, but increased the fines.
This involved more than eighty works of art that had been imported into Switzerland between 2008 and 2013 in the so-called relocation process and had a value of over 11 million francs. The three accused were accused of having committed multiple, deliberate tax evasions within the meaning of the Federal Value Added Tax Act, in that the art objects were wrongly declared and assessed as alleged commission goods in the relocation process of the Zurich Gallery Gmurzynska. Some of them were top-class works by artists such as Picasso, Miró or Andy Warhol.
In addition to exhibiting the works in Switzerland, the aim was not to have to pay import taxes, according to the judges. In the case of Schwarzenbach and the gallery owner, the Zurich District Court had come to a guilty verdict in 75 cases and in the case of the lawyer in 63 cases.
The lawyer is an accomplice and not just an accomplice
The accused all applied to the High Court for the suspension of the administrative criminal proceedings due to the statute of limitations or for a full acquittal. However, like the lower court, the higher court came to the conclusion that the statute of limitations had not expired. In addition, the parties could not have shown that the lower court’s assessment of the evidence was arbitrary. In deviation from the lower court, the higher court even qualified the lawyer as an accomplice and not just as an assistant.
At Schwarzenbach, the fine was increased from CHF 6 million to CHF 7.07 million. The convicted lawyer, who got away with 500,000 francs before the lower court, now has to pay 1.99 million francs. And the amount of the gallery owner’s fine was newly set at 1.37 million francs instead of 1 million francs. This was mainly because the higher court deviated from the lower court’s sentencing methodology. The accumulation principle was used instead of the asperation principle.
Judgments SU210055 of August 12, 2022 and SU210013 of September 5, 2022, both not yet final.