Berlusconi Tax Trial Delayed As Defence Run Down The Clock

by Ulrika Lomas, Tax-News.com, Brussels

23 November 2006

The trial of former Italian Prime Minister Silvio Berlusconi for tax evasion and other financial crimes has been delayed while the defence attempts to remove one of the trial judges.

According to Berlusconi's lawyers, Judge Edoardo d'Avossa is unsuitable to preside over the hearing because he has previously heard another case involving Berlusconi. On that occasion, the former Prime Minister was acquitted of charges of false accounting.

In his latest brush with the authorities, Berlusconi, along with a dozen other defendants, is facing charges of tax fraud, false accounting, money laundering and embezzlement, stemming from transactions in which his television network Mediaset acquired US film rights through two offshore companies between 1994 and 1996, and allegedly artificially inflated the purchase price to avoid tax.

Notably, Berlusconi's co-defendant is British lawyer David Mills, the estranged husband of Tessa Jowell, Culture Secretary in Tony Blair's cabinet. The prosecution alleges that Mills received US$600,000 from Berlusconi for giving false testimony in a 1997 trial in which Berlusconi was charged with bribing tax officials to give favourable tax audits of his media companies.

Berlusconi and Mills face prison terms of up to twelve years if convicted. However, Italy's statute of limitations may come to their rescue, and prosecutors only have until November 2007 to prove their case.

Conveniently for Berlusconi, the statute of limitations was reduced to seven-and-a-half years in 2005 - just months before he was voted out of office in April 2006.

The trial is due to recommence next Monday.

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