1977, Trying to save the industry, the Labour Party nationalised the UK aircraft and shipbuilding industries. The next government (a conservative one) that did not want to pay compensation defended the case, it is said that this defences was one of the ‘greatest own goals in recent political history’, since that party did not agree with the nationalisation.
The applicants had certain of their interests nationalised under the Aircraft and Shipbuilding Act 1977. Whilst not contesting the principle of nationalisation the applicants claimed that the compensation which they received was grossly inadequate and discriminatory, since inter alia, inflation was not taken into account.
The applicants alleged that they had been victims of breaches of Art 1 of protocol 1 to the Convention: ‘Every natural or legal person is entitled to the peaceful enjoyment of his possessions. No one shall be deprived of his possessions except in the public interest and subject to the conditions provided by law and by general principles of IL’ ‘The preceding provisions shall not, however, in any way impair the right of a State to enforce such laws as it deems necessary to control the use of property in accordance with the general interest or to secure the payment of taxes or other contributions or penalties’
106. The Court recall that Article 1… guarantees the right of property …. Comprising ‘three distinct rules’ … peaceful enjoyment of property… depravation of possession … subject[ed] …to certain conditions … right of state to control the use of property
107. The applicants were clearly ‘deprived of (their possessions) within the meaning of … article 1 indeed, this point was not disputed before the Court…. Were the applicants deprived of their property ‘in the public interest’ and subject to the conditions provided by law’?
111. The applicants argued that the reference in the second sentence of Article 1 (P1-1) to the ‘general principles of international law’ meant that the international law requirement of, so they asserted, prompt, adequate and effective compensation for the deprivation of property of foreigners also applied to nationals
112. The Commission has consistently held that the principles in question are not applicable to a taking by a State of the property of its own nationals. The Government supported this opinion
113. As a matter of general international law, the principles in question apply solely to non-nationals. They were specifically developed for the benefit of non-nationals