EUROPEAN COMMISSION Brussels, 21.12.2016 SWD(2016) 468 final COMMISSION STAFF WORKING DOCUMENT IMPACT ASSESSMENT

Accompanying the document Proposal for a regulation of the European Parliament and of the Council on the mutual recognition of freezing and confiscation orders {COM(2016) 819 final}

{SWD(2016) 469 final}



Table of Contents 1.Introduction 2.Policy context 2.1.Policy context and current challenges 2.2.Statistical data 2.3.Stakeholder consultation 3.The current legal framework 3.1.The asset recovery process 3.2.Different types of asset recovery 3.3.The EU legal framework 3.4.The international legal framework 3.5.Confiscation in EU Member States 3.6.Recent trends in the area of freezing and confiscation 4.Problem definition 4.1.The general problems: 4.2.General problem 1: Too few criminal assets are frozen and confiscated in the European Union in cross-border cases 4.3.Specific problems 4.3.1.Specific problem 1: Too limited scope of the current mutual recognition legal framework 4.3.2.Specific problem 2: The current procedures and certificates are too complex and inefficient

4.3.3.Specific problem 3: Inconsistent implementation of existing mutual recognition instruments into national law 4.4.General problem 2: The current mutual recognition instruments do not contain provisions on victims' compensation and restitution 4.5.The scale of the problem 4.5.1.The scale of criminal activity 4.5.2.The scale of freezing and confiscation in the European Union 4.5.3.Cross-border confiscation and freezing 4.5.4.Cross-border confiscation and victims compensation 4.6.Baseline scenario: how would the problem evolve in the future if no EU action takes place? 4.7.Does the EU have power to act? 4.7.1.Legal basis 4.7.2.Subsidiarity: Why is the EU better placed to take action than Member States? 4.8.Fundamental Rights 5.Objectives 6.Policy options 6.1.Discarded Options 6.2.Description of the policy options 6.2.1.Option 1: Maintaining the status quo 6.2.2.Option 2: Non-regulatory option 6.2.3.Option 3 – Minimal regulatory option 6.2.4.Option 4 –Medium and Maximal regulatory option

7.Analysis of the impacts of the policy options 7.1.Option 1: Maintaining the status quo 7.2.Option 2: Non-regulatory option 7.3.Option 3: Minimal regulatory option 7.4.Option 4: Medium and Maximal regulatory option 7.5.Overall comparison of costs and income of different options 8.Comparison of the options 9.The preferred option 10.Monitoring and evaluation Annex 1Procedural Information Annex 2Stakeholders Consultation Annex 3Who is affected by the initiative and how? Annex 4The International legal framework Annex 5Non-conviction based confiscation systems in the EU Annex 6Confiscation and fundamental rights Annex 7Cost calculations Annex 8List of abbreviations Annex 9Bulgarian example





1.Introduction This impact assessment concerns a set of measures to strengthen the mutual recognition of freezing and confiscation orders to be executed on a cross-border basis within the European Union. Such measures aim at facilitating and enhancing cooperation between Member States as regards the mutual recognition and execution of orders to freeze and to confiscate property. This will increase Member States’ abilities to seize and confiscate criminal assets in other Member States and thereby reduce the ability of organised crime groups to operate effectively. One of the main motives for criminal activity is financial gain. Taking away the profit of criminal activity and making sure that "crime does not pay" is therefore a very effective mechanism to combat crime. Seizing assets generated by criminal activities aims at preventing and combatting crime, including organised crime, compensating victims and provides additional funds to invest back into law enforcement activities or other crime prevention initiatives. Freezing and confiscation of assets is also an important tool to combat terrorist financing and the recent terrorist attacks in the EU and notably in France, Belgium and Germany have shown the urgent need to act. Recent research estimates that illicit markets in the European Union generate about 110 billion EUR, i.e. approximately 1% of the EU's GDP in 2010. However, and although existing statistics are limited, the amount of money currently being recovered from proceeds of crime within the EU is only a small proportion: 98.9% of estimated criminal profits are not confiscated and remain at the disposal of criminals. A functioning asset recovery regime is a precondition if more criminal assets are to be seized. This includes an efficient mutual recognition framework for freezing and confiscation orders. Although legislation on mutual recognition of freezing and confiscation orders does exist at EU level, it is patchy, out of date, and leaves significant lacunae which are exploited by criminals. 2.Policy context 2.1.Policy context and current challenges The importance of confiscation of criminal assets has been recognised by the European Union. After the adoption in 1999 of the Tampere European Council conclusions, four legislative instruments on freezing and confiscation, including two mutual recognition instruments, were adoped between 2001 and 2006, which are all (at least in parts) still in force today. After the entry into force of the Lisbon Treaty, confiscation has been given strategic priority at EU level as an effective instrument to fight organised crime. Another instrument, Directive 2014/42/EU, was adopted, which establishes common minimum rules and thereby harmonises the freezing and confiscation of instrumentalities and proceeds of crime in the European Union. When adopting Directive 2014/42/EU, the European Parliament and the Council, in a joint statement, called on the Commission "to present a legislative proposal on mutual recognition of freezing and confiscation orders at the earliest possible opportunity (…) considering the need of putting in place a comprehensive system for freezing and confiscation of proceeds and instrumentalities of crime in the EU". This call has been repeated at various occasions since in bilateral contacts and expert meetings. In this joint statement the European Parliament and the Council also called on the Commission to analyse the feasibility, opportunity and possible benefits of introducing common rules on non-conviction based confiscation taking into account the differences between the legal traditions and the systems of the Member States. In view of delivering this analysis the Commission has organised expert meetings in September and November 2016. It envisages to issue the feasibility analysis in 2017. The terrorist attacks in 2015 and 2016 in the European Union and beyond underlined the acute need to prevent and fight terrorism, including depriving criminals from proceeds of these crimes. The Commission recognised in its European Agenda on Security of 28 April 2015 the urgent need for measures to address terrorist financing in a more effective and comprehensive manner and committed in its Communication of 2 February 2016 to the European Parliament and the Council on an "Action Plan for strengthening the fight against terrorist financing", to strengthening the mutual recognition of criminal assets' freezing and confiscation orders by the end of 2016. It was underlined that the "mutual recognition of judgments and judicial decisions is a key element in the security framework". In October 2016, the European Parliament, in the context of a report presented by MEP Laura Ferrara on the fight against corruption, has called again on the Commission to submit a proposal on the strengthening of mutual recognition of freezing and confiscation orders. The current initiative is a response to identified deficiencies of the existing mutual recognition instruments and to these policy calls. It builds on existing EU legislation on mutual recognition of freezing and confiscation orders and adresses the fact that Member States have developed new forms of freezing and confiscating of criminal assets, going beyond the traditional forms of conviction based confiscation. . It also takes into account developments at EU level, including the minimum standards for freezing and confiscation orders set out in Directive 2014/42/EU. The adoption of this Directive, combined with other factors, contributed to a shift of positions in Member States to use confiscation more frequently as a means to fight crime more effectively. Whereas the Directive improves the domestic possibilities to freeze and confiscate assets, the current proposal aims to improve the cross-border enforcement or freezing and confiscation orders. Together, both instruments should contribute to effective asset recovery in the European Union. This initiative also concurs with recent activities taken beyond the EU as the Council's of Europe Action Plan of 2 March 2016, the on combating Transnational Organised Crime (2016-2020). Pointing to the recovery of assets, where the Council of Europe also identified shortcomings both in terms of implementation of the existing conventions and of scope of these instruments. The Action Plan proposes different actions to improve recovery of criminal assets, including facilitating exchange of best practices, training, guidelines, but also reviewing if a new convention would be necessary e.g. to cover new forms of confiscation or to enhance the situation of victims in asset recovery procedures. 2.2.Statistical data It has proved difficult to collect statistical data covering the number of cross-border freezing and confiscations orders, the amounts involved and/or recovered. The analysis in this Impact Assessment has constrains in data availability because: The enforcement of freezing and confiscation orders is not centralised in the Member States, meaning that a large number of judges and prosecutors is involved, and there is no obligation to inform a centralised organisation on when a request comes in; In many Member States statistics on freezing and confiscation orders are not compiled; There are different types of enforcement orders and they are not organised by categories;

For cross-border cases there is no obligation to collect data neither on the number of requests to be executed in another Member State nor on the value or the estimated value recovered following the execution in another Member State. The need for statistics has been highlighted many times over the last years. A study carried out in 2009 stated "The majority of EU Member States do not automatically evaluate innovations like criminal asset recovery. The operating statistics necessary to measure implementation and assess effects are therefore not available. This makes it very difficult to diagnose and remedy system defects". The lack of statistical data was also raised in the Commission's Impact Assessment accompanying the Proposal for a Directive on the freezing and confiscation of proceeds of crime in the EU. In order to remedy this issue, Directive 2014/42/EU provides in Article 11 the obligation on Member States "to regularly collect and maintain comprehensive statistics from the relevant authorities in order to review the effectiveness of their confiscation systems". Concerning cross-border cases, the Directive also requires Member States to provide statistics on the number of freezing and confiscation orders to be executed in another Member State, and the value of the property recovers, if they are available at central level. This is an important step forward to improve data collection. However, the data gathering obligation is fully binding only from 4 October 2016 onwards. Moreover, regarding cross-border cases, the Directive creates an obligation to , to provide statistics to the Commission only if they are already available at central level in the Member State concerned. It also requests Member States to endeavour to collect data at central level. 2.3.Stakeholder consultation This report is based on a targeted consultation of relevant stakeholders. Confiscation is a specialised and technical topic which is dealt with by a rather limited number of experts working in this area (namely prosecutors, judges, lawyers, bar associations, officials working in national Ministries of Justice or Interior or Asset Recovery Agencies, academia). Bilateral contacts, expert meetings and conferences were organised by the Commission to complement existing sources of information and provide additional data and facts. The most important ones were a large conference organised jointly by the Commission together with the NL Presidency on 20 June 2016, where about 100 experts from all Member States exchanged their views, a meeting of the Criminal Law Experts Group on 29 September 2016 and most recently an expert meeting on 17 November 2016 with experts from the national Ministries of Justice or Interior. A summary of this consultation process is provided for in Annex 2. 3.The current legal framework 3.1.The asset recovery process Asset recovery applies in principle to all crimes (or at least to most criminal activities in some Member States). However, in practice it is more frequently applied to serious cases. Typical examples are crimes generating huge income and liquidity, such as drug trafficking. The proceeds of crime are then converted into assets ranging from cash held in bank accounts to real estate, luxury vehicles such as sportcars, yachts, livestock, artworks, company shares, businesses, collector's items etc. Table 1: Examples of asset confiscation in cross-border cases Member State Assets subject to confiscation with Eurojust's assistance Belgium Two boats to be confiscated in Spain Bulgaria € 37000 in cash and real estate property confiscated in the United Kingdom Germany € 100 000 000 confiscated in a large tax fraud case involving coordinated searches in 15 countries Ireland Substantial amounts of property confiscated in Spain and Ireland Spain Five cases involving confiscation of € 112 000 000, € 17 000 000, € 1 000 000, € 23 000 and € 9 000 000. Italy Provisional confiscation in the Netherlands of € 400 000. Freezing of 800kg of counterfeit products in 10 countries. Freezing of a luxury watch in Germany. Freezing of 300kg of cocaine in Belgium, Spain, Italy and Czech Republic. Freezing of documents related to the registration of 100 vehicles in Germany. Freezing of 700 kg of hashish, one pc, mobile telephones and documents in France, Spain and the United Kingdom. Freezing of one server in Austria. France Property and vehicles confiscated in Italy, one ship and the freezing of 1400 kg of cocaine. Sweden € 1 685 800 confiscated in Sweden and a ship in another country. UK All property and money of a main suspect (incl. a house, a speedboat and money with a total value in excess of € 1 200 000). Several luxury vehicles in Spain. The recovery of criminal assets is a legal process whereby criminal assets are recovered in favour of victims, deprived communities or the State. At the heart of this process lies the determination by a court that particular assets derive from criminal activity and are, thereby, liable to confiscation. This typically takes the form of a confiscation order. The process is illustrated in table 2 below. Table 2: The steps in the asset recovery process in Europe 1. Identification/tracing: Regardless of the nature of the confiscation order, criminal assets can only be confiscated once they have been identified. 2. Freezing: during the investigation process, criminal assets subject to confiscation must be secured to avoid dissipation, movement or destruction. The typical mechanism is freezing. 3. Confiscation: The confiscation is the final deprivation of property of criminal assets ordered by a court. 4. Enforcement: When a court has ordered the confiscation, the order makes it legally possible to recover criminal assets. The confiscation order is enforced against particular assets. The person subjected to the measure loses all rights to the confiscated asset, steps must be taken to enforce the order 5. Return of Assets: Recovered assets may be returned to victims or deprived communities or they may revert to the State. The first stage in the asset recovery process is the tracing and identification of assets. This phase involves law enforcement investigations (usually under the coordination of a prosecutor) and requires substantial financial investigation skills. As assets are often hidden abroad, it requires cross-border cooperation. National Asset Recovery Offices (AROs) play a key role in expediently providing information to other AROs on the assets located in their territory. After criminal assets are located in one or more countries, judicial procedures are needed to first freeze them and subsequently to confiscate them. Following their freezing, assets should be properly managed between the time when they are seized and the time when a confiscation order is issued, so that their value is maintained. In principle assets become the property of the executing State, which may sell them or re-use them as appropriate. The impact assessment focuses on steps 2 and 3, being the main aspects for judicial cooperation in cross-border cases, and also covers steps 4 and 5. 3.2.Different types of asset recovery Criminals attempt to conceal their illicit gains from justice, taking all measures they can to put assets beyond the scope of confiscation laws or enforcement measures. In recent years, as a response to this phenomenon, many Member States have instituted new forms of confiscation orders in order to deprive criminals of their illegally obtained assets more efficiently. One can distinguish: - ordinary confiscation (conviction based confiscation) is a confiscation measure directed against an asset which is the direct proceed or the instrumentality of a crime, following a criminal conviction for that crime;

- extended confiscation is a confiscation measure following a criminal conviction that goes beyond the direct proceeds of the crime for which a person was convicted, where the property seized is derived from criminal conduct. A direct link between the property and the offence is not necessary if the court concludes that part of the person's property was obtained through other unlawful conduct. - third-party confiscation is a confiscation measure made to deprive someone other than the offender – the third party - of criminal property, where that third party is in possession of property transferred to him by the offender; - value-based confiscation is a confiscation measure by which a court imposes an order corresponding to the value of proceeds or instrumentalities of a crime, which is realizable against any property of the individual; - non-conviction based confiscation (hereafter ‘NCBC’) is a confiscation measure taken in the absence of a conviction and directed against an asset from illicit origin. It covers cases where a criminal conviction is not possible because the suspect has become ill or fled the jurisdiction, has died, lacks legal capacity (e.g. is a minor or of unsound mind), has immunity from prosecution or amnesty or where the statute of limitations has passed, or where a conviction is not possible for other reasons like lack of proof, but the court is nevertheless convinced in a criminal procedure that the assets are of criminal origin. It also covers the cases of action against the asset itself (so-called "proceedings in rem", generally in civil proceedings), regardless of the person in possession of the property, for example when the proceeds of crime have been identified but cannot be linked to any individual; or the suspect is outside the jurisdiction of the Member State considering confiscation and there is no prospect of his being brought within that Member State to face trial. In addition several Member States provide for the right of the victim for restitution or compensation of damages from the confiscated property. 3.3.The EU legal framework The current EU legal framework consists of five main instruments. Apart from Council Decision 2007/845/JHA on asset tracing, two of them are mutual recognition instruments while two others are harmonisation measures. Both types of instruments are necessary in order to have a functioning regime of recovery of criminal assets and they complement each other. Mutual recognition Mutual recognition means that a decision usually taken by a judicial authority in one EU Member State is recognised, and where necessary, enforced by other EU Member States as if it was a decision taken by the judicial authorities of the latter Member States. Mutual recognition is based on mutual trust between Member States' authorities. Harmonisation Harmonisation in the area of EU criminal law means creating common minimum standards. It does not involve full scale unification. The mutual recognition principle implies that a judicial decision taken by a competent judicial authority of a Member State has to be executed in another Member State without prior verification according to the national law of the executing State. The grounds on which recognition and execution can be refused are enumerated exhaustively in the instrument. A certificate to be used contains all necessary information for the executing State to take its decision. There are a number of EU instruments in the area of judicial cooperation in criminal matters based on the principle of mutual recognition. The most successful one is probably the European Arrest Warrant. It is difficult to deduct key success factors from an instrument like the EAW and apply them to a very different context like the freezing and confiscation of criminal assets, but the EAW example shows that mutual recognition can make judicial cooperation between Member States very efficient. Mutual recognition instruments: Council Framework Decision 2003/577/JHA of 22 July 2003 on the execution in the European Union of orders freezing property or evidence and Council Framework Decision 2006/783/JHA of 6 October 2006 on the application of the principle of mutual recognition to confiscation orders are aimed at facilitating the recovery of assets in cross-border cases. Both Framework Decisions are based on the principle of mutual recognition and work in a similar way. Both instruments require freezing or confiscation orders issued in one Member State to be recognised and executed in another Member State. The orders are transmitted alongside a certificate to the competent authorities in the executing State which must recognise them without further formalities and take the measures necessary for their execution. Mutual recognition is mandatory for a list of offences punishable by at least three years of imprisonment in the issuing State. In other cases, dual criminality is necessary, which means that recognition can be refused if the crime to which the freezing or confiscation order relates is not a criminal offence under the laws of the executing Member State. The Framework Decisions allow for further grounds for refusal in certain situations. Harmonisation measures: Council Framework Decision 2001/500/JHA on money laundering, the identification, tracing, freezing, seizing and confiscation of instrumentalities and the proceeds of crime, the first instrument in this area, was soon considered not to sufficiently achieve effective cross-border cooperation and was replaced in 2005 by the Framework Decision 2005/212/JHA. Council Framework Decision 2005/212/JHA of 24 February 2005 on confiscation of crime-related proceeds, instrumentalities and property requires all Member States to put in place effective measures to enable the ordinary confiscation of criminal instrumentalities and proceeds for all criminal offences punishable by detention of at least one year. It also introduced provisions on extended confiscation. However, the level of harmonisation introduced by this instrument is very low, and it has not removed the diversity of national legal confiscation regimes. Directive 2014/42/EU of 3 April 2014 on the freezing and confiscation of instrumentalities and proceeds of crime in the EU had to be implemented by Member States until October 2016. It replaces certain provisions of Council Framework Decision 2005/212/JHA. Whereas Framework Decision 2005/212/JHA applies to all criminal offences punishable by detention of at least one year, the Directive could only cover the so-called Eurocrimes.

Directive 2014/42/EU sets minimum rules for national freezing and confiscation regimes: it requires ordinary and value confiscation for Eurocrimes, including where the conviction results from proceedings in absentia. It provides rules for extended confiscation subject to certain conditions. It also enables confiscation where a conviction is not possible because the suspect or accused person is ill or has absconded. The Directive also enables for the first time the confiscation of assets in the possession of third parties. Finally, the Directive introduces a number of procedural safeguards, such as the right to be informed of the execution of the freezing order including, at least briefly, on the reason or reasons; the effective possibility to challenge the freezing order before a court; the right of access to a lawyer throughout the confiscation proceedings; the effective possibility to claim title of ownership or other property rights; the right to be informed of the reasons for a confiscation order and to challenge it before a court. 3.4.The international legal framework Since the 1990's the confiscation of illicit money has become a political priority at international level (UN, OECD, Council of Europe, Financial Action Task Force - FATF). The international acquis is set out in detail in Annex 4. The international conventions are important tools in the fight against organised crime and the efforts to enhance asset recovery. They provide alternative, more traditional means of judicial cooperation compared to mutual recognition, based on mutual legal assistance (MLA). Mutual legal assistance Mutual legal assistance consists of cooperation between different countries for the purpose of gathering and exchanging information , requesting and providing assistance in obtaining evidence located in one country to assist in criminal investigations or proceedings in another or in freezing and confiscating assets of criminal origin. Mutual legal assistance is widely used in cross-border cooperation in criminal matters. It is based on reciprocity and involves more actors than mutual recognition: requests are generally sent by a judge to a central authority in the requesting State, then to a central authority in the requested State, then to a judicial authority for execution. It allows to combine several requests (e.g. assistanc to locate an asset and then assitance to freeze the asset), which is an advantage compared to mutual recognition. However, in comparison to mutual recognition there are obvious drawbacks of the system of mutual legal assistance: the execution is not mandatory but depends on the domestic legal system of the executing State. Moreover, a mutual legal assistance procedure may be very lengthy as there are no deadlines foreseen and more actors involved (in average, mutual legal assistance requests habe been found to last about a year in average). In addition, not all of the international acquis is binding or applicable between all EU Member States. For example, the so-called "Warsaw-Convention" adopted by the Council of Europe in 2005 has been ratified only by 17 EU Member States. The Recommendations adopted by the Financial Action Task Force (FATF) have no binding character. 3.5.Confiscation in EU Member States The national confiscation systems in the EU differ substantially. Each Member State’s confiscation laws have evolved in response to domestic imperatives, the respective legal traditions and cultural differences. By the time the EU began to act in 2001 some Member States already had potent asset confiscation regimes in place, whilst others did not. For efficiency reasons, some Member States have introduced confiscation systems to provide for the confiscation of property without a prior criminal conviction. In Europe, Italy was the first country to introduce a preventative confiscation system in 1965 in order to tighten the fight against mafia organisations. In 1996, inspired by the USA which had introduced civil confiscation in 1970, comprehensive legislation on NCBC was developed in Ireland. The Irish non-conviction based model acts in rem on property that constitutes the proceeds of crime. It applies civil law, no link to criminal proceedings is required. Several years later, similar legislation came into force in the United Kingdom. More recently, Bulgaria, Slovakia and Slovenia have also introduced forms of civil NCBC in which the confiscation proceedings are initiated against the property (see Overview of NCBC systems, Annex 5). These systems are generally referred to as civil because they allow for the recovery in civil proceedings, where evidence of a specific crime generally follows civil law standards. Assets are taken from persons suspected of involvement in crime or illegal activity without necessarily charging the owner of the assets with an offence. Civil confiscation is directed against property, not a person. Conviction-based confiscation in criminal proceedings Non-conviction based confiscation in civil proceedings Proceedings are brought by the State against an individual and form part of an action brought against a specific person (in personam). Proceedings are initiated by the State against the property (in rem). The confiscation usually forms part of the sentencing of the individual once found guilty (criminal conviction) in criminal proceedings. Confiscation is imposed before, during or after criminal conviction, or even when no action is brought against a specific person. A criminal conviction in criminal proceedings is required with clear evidence of a crime "beyond reasonable doubt." A criminal conviction is not required. Evidence of unlawful conduct must be provided and the illegality of the assets must be decided based on the "balance of probabilities", often with a shifting of the burden of proof from the Member State to the individual/owner of the asset. Object-based and value-based Object-based Criminal courts Criminal or civil courts Source: EUROJUST, Report on non-conviction based confiscation, 2012, p.7 In addition, differences between Member States also exist with regard to extended confiscation. Framework Decision 2005/212/JHA left a choice to Member States regarding the criteria for extended confiscation. Directive 2014/42/EU lays down common minimum standards for extended confiscation in all Member States. In addition to the systems described above, Greece, Latvia, Lithuania, the Netherlands, Romania and Spain have introduced NCBC in the form of "unexplained wealth" in some limited cases. This means that the actual property of a person is compared to the income declared in order to identify any disparity between the two. Establishing a link to an offence is not necessary. Also, some of the Member States apply different administrative proceedings to confiscate property obtained through unlawful conduct. For example, in Hungary any property obtained through unlawful conduct could be confiscated in tax proceedings. 3.6.Recent trends in the area of freezing and confiscation Several years of efforts at international and EU level have led to an enhanced perception of the importance of confiscation and freezing and a more dynamic development in this area recently. This is not only due to the legal work (e.g. Directive 2014/42/EU) but also to an enhanced exchange of expertise between Member States. For example, regular meetings at expert level to exchange best practices and to enhance cooperation. For example, regular expert meetings of Member States' authorities have been organised by the Commission under the EU ARO Platform, several meetings with Europol and Eurojust have taken place to support and strengthen Member States' activities at operational level. All these efforts have contributed to an increased awareness of the importance of confiscation and freezing in the fight against organised crime and terrorism. They have also shown that the traditional forms of criminal conviction based confiscation are rather complicated and heavy and therefore not very efficient.

It is against this background that Member States are currently revising their freezing and confiscation legislation to implement Directive 2014/42/EU. Several Member States are using this opportunity to modernise their asset recovery regimes beyond the obligations of the Directive. On 25 April 2015, 21 April 2016 and 17 November 2016 the Commission held experts meetings where the Member States provided detailed information on their respective systems and legislative reforms to implement the Directive 2014/42/EU. Largely, three groups of Member States can be distinguished: (1) Approximately 12 Member States which have the classical conviction based approach and which aligned (or are currently aligning) their asset recovery regimes along the lines of the Directive 2014/42/EU (including extended confiscation and criminal non-conviction based confiscation in cases of illness or absconding only). (2) Approximately 8 Member States which go beyond the requirements of the Directive 2014/42/EU and include other forms of criminal non-conviction based confiscation (in case of death of a person or where a criminal court can confiscate an asset in the absence of conviction when the court is convinced that such asset is the proceeds of crime). (3) Approximately 7 Member States which have an asset recovery regime (or where a reform is ongoing) which includes also civil or administrative non-conviction based confiscation. It became also clear that even though the Directive will result in greater harmonisation on many aspects of the different confiscation regimes in the EU Member States, important differences are expected to persist in areas outside the scope of the Directive, in particular regarding NCBC and the civil or administrative procedures that some Member States use . 4.Problem definition The problem definition builds on: - the implementation reports on Framework Decision 2003/577/JHA and Framework Decision 2006/783/JHA; - the 2012 Impact Assessment accompanying the Commission proposal for Directive 2014/42/EU which already concluded on the need for a legal instrument to improve mutual recognition in this area; - a comparative law study on the implementation of mutual recognition of freezing and confiscation orders in the EU of 2013; - several expert meetings (including an in-depth expert meeting on 17 November 2016 with focus on non-conviction based confiscation) and conferences dedicated to the issue of mutual recognition of freezing and confiscation orders. In view of the existing data, a separate ex post evaluation of the existing mutual recognition instruments was not carried out. The 2013 study evaluated the performance of the existing EU measures (effectiveness, efficiency). The 2012 Impact Assessment accompanying the proposal for Directive 2014/42/EU also included an evaluation of the same measures, and reached an identical conclusion, namely that there was a fundamental problem with the scope of the existing measures and that a new mutual recognition instrument was justified. The 2012 Impact Assessment was approved by the Impact Assessment Board. Moreover, no public consultation was carried out because of the nature of the topic and the political urgency, cf. Annex 2. For both the ex post evaluation and the public consultation, an exemption was granted. 4.1.The general problems: Two general problems have been identified in the context of the mutual recognition of freezing and confiscation orders within the EU: (1) the insufficient recovery of criminal assets in cross-border cases; (2) the insufficient protection of victims' rights to restitution and compensation in cross-border cases. Although both problems are not directly inter-linked, the second problem depends to a certain extent on the first problem (if there is insufficient freezing and confiscation in cross-border cases, the restitution and compensation of victims will be insufficient as well). 4.2.General problem 1: Too few criminal assets are frozen and confiscated in the European Union in cross-border cases The 2015 report of organised Crime Portfolio concludes that organised crime activities are often transnational in nature and the assets of criminal groups are increasingly invested in other Member States. Illicit markets in Europe are changing rapidly in size, products, actors, routes and flows, but they remain key source of proceeds for organised crime in Europe. A significant discrepancy exists between what criminals invest and what is actually confiscated. To tackle this phenomenon, efficient judicial cooperation is necessary. Nevertheless, Member States today make little use of judicial cooperation tools to freeze and confiscate criminal assets located in other Member States. Only very few freezing and confiscation orders are issued and executed in other Member States, in relation to the amount of criminal assets moved abroad by the offenders. According to reports by practitioners and Member States' governments, compared to some other mutual recognition instruments (such as the European Arrest Warrant (EAW)), the ones on freezing and confiscation are used very little. Members of Eurojust, Europol, judges and prosecutors have repeatedly pointed out during expert meetings or bilateral contacts that confiscation is a very efficient tool, in particular in the fight against organised crime such as drug trafficking. Many have noted that confiscation procedures at cross-border level are underused and that there is an increased need for effective cross-border cooperation on asset recovery.

For some Member States, classic tools and instruments of international co-operation, i.e. requests for mutual legal assistance, have remained the most suitable route for asset recovery cases. But even if one takes mutual legal assistance into account, cross-border confiscation procedures remain underused. It results clearly from various studies carried out recently in this area that the main reason for this is the differences in national freezing and confiscation schemes described above, combined with a lack of obligation to recognise many of those orders. The executing Member State may not know in its legal system the type of confiscation that is to be implemented. The proceedings may be of a different nature, the standard of proof may be different and procedural rights may vary. A significant number of Member States does therefore not recognise some types of freezing or confiscation orders issued in another Member State, be it under mutual recognition or mutual legal assistance. Moreover, the current Framework Decisions on mutual recognition have several deficiencies, described below. There are also cultural differences between Member States regarding how much confiscation is used, but this is not specifically linked to the issue of lack of cross-border confiscation and is outside the scope of this exercise. This provides a fertile environment for criminals, including terrorists and terrorist organisations; they are able to keep the proceeds of their criminal activities and even re-use them for commiting further crimes. The recent terrorist attacks in 2015 and 2016 have underlined the urgency and the need for the Commission to act and to disrupt the ability of criminals and terrorists to keep the proceeds of crime for financing terrorism or other illicit conduct. Criminals are reported to target those Member States which have weak asset recovery regimes or practices as places to invest or move assets to. Efforts made by individual Member States to strengthen their national asset recovery regimes are in vain, if criminals are able to move their assets to other Member States, making use of the facilities of the internal market, and the freezing and confiscation orders cannot follow the assets across borders. The penetration of organised crime into the licit economy, even if it takes place in a single Member State, affects the functioning of the whole EU Internal Market, not only of that country. Even when managing licit businesses, organised crime groups, often support these activities with the recourse to intimidation and corruptions, thus altering competition and the smooth functioning of the Internal Market. The resulting loss of revenues affects both national and EU financial interests, even when it takes place in only one Member State. The aims of asset recovery are realised not only when criminals are deprived of their illegal gains but when these are redistributed effectively. In particular, the impact of asset confiscation upon public trust in the criminal justice system may be enhanced through redistribution and restorative justice (for more details, see Annex 3). 4.3.Specific problems 4.3.1.Specific problem 1: Too limited scope of the current mutual recognition legal framework The main specific problem which has been identified is that the existing EU legislation on mutual recognition of freezing and confiscation orders has not kept up with recent developments in national legislation in some Member States and with recent EU legislation on minimum rules, notably the Directive 2014/42/EU on the freezing and confiscation of instrumentalities and proceeds of crime in the EU. In particular, the current mutual recognition instruments do not cover all the types of freezing and confiscation orders that can be adopted at national level (notably with regard to NCBC). As a result, mutual recognition is generally limited to traditional conviction based confiscation orders. Member States that have established new forms of confiscation not based on a criminal conviction, in particular criminal, civil and administrative forms of non-conviction based confiscation, to fight crime more efficiently, are not able to ensure that those orders are recognised and executed in other Member States that don't have the same regimes, and even in Member States that have similar regimes. Mutual legal assistance has to be used when the Framework Decisions do not apply, meaning that the benefits of mutual recognition are lost for those procedures: the execution depends on the domestic legal system of the executing Member State, is not subject to deadlines and is not mandatory. Even if some Member States that only have criminal confiscation regimes might be able to execute such orders, other Member States will systematically refuse. Examples While France is able to execute Italian NCBC orders under mutual legal assistance, Spain would systematically deny the execution of a civil NCBC order taken using in rem proceedings. For example, Ireland may issue a civil NCBC for criminal assets located in Spain when a criminal conviction is not possible. However, as Spain does not recognize such Irish order, the property order could not be confiscated and would remain at the offender's disposal. Another example is a case where both jurisdictions have NCBC, namely Ireland and the United Kingdom. In this case, a freezing order was obtained by Ireland. The target brought the assets across the border to Northern Ireland in an attempt to evade the order. The order could not be enforced in the United Kingdom as there exists no such mechanism even between NCBC jurisdictions. Another example, an ongoing Bulgarian case, can be found in Annex 9. - Non-alignment of current mutual recognition instruments with Directive 2014/42/EU While Article 5 of Directive 2014/42/EU requires all Member States to enable extended confiscation, the current mutual recognition Framework Decisions leave broad possibilities to refuse execution of orders based on extended confiscation, limiting the obligation to recognise such orders. Thus, the receiving Member State may choose whether or not to enforce freezing or confiscation orders issued with a view to confiscate proceeds that are not connected to the specific crime for which the person is being prosecuted. Similar issues arise with the cases of illness or absconding of the suspected or accused persons which have been introduced by Article 4 of Directive 2014/42/EU. None of these cases require execution by the two Framework Decisions. One of the benefits of harmonisation is that it increases mutual trust and facilitates mutual recognition; this benefit is lost when the mutual recognition instrument is not at least aligned with the harmonisation instrument, and the gaps in the mutual recognition rules would have a considerable negative impact and hamper the functioning of the whole system. As underlined by experts in recent meetings, now that the Directive 2014/42/EU entered into force, there is an obvious need for reinforcing the mutual recognition system in the EU and to complement the harmonisation measures already adopted. - No coverage of more modern forms of NCBC, including notably civil and administrative NCBC Although a number of Member States confiscate assets outside of criminal proceedings (see above, Section 3.5), existing EU legislation does not require that confiscation orders issued in relation to these proceedings should be recognised. Although some international instruments, such as the Warsaw Convention, provide a legal base for mutual legal assistance in the execution of such orders, these conventions are not applicable in all Member States, nor can they reach a similar efficiency as a mutual recognition instrument can. In practice such orders are not routinely recognised by other countries and there is no legal instrument that would require recognition. - Conclusion The limited scope of the current legal framework affects the overall quality of justice within the EU and consequently undermines mutual trust between judicial authorities. This means that Member States are missing opportunities to seize and confiscate criminal assets, recover proceeds of crime and deprive criminals of their means to operate. 4.3.2.Specific problem 2: The current procedures and certificates are too complex and inefficient

Practitioners including judges, prosecutors, representatives from Member States, reported repeatedly that the mutual recognition certificates provided for in the Framework Decisions 2003/577/JHA on the execution of freezing orders and 2006/783/JHA on the mutual recognition of confiscation orders are complicated and lengthy, thereby increasing the administrative burden on the authorities and the length of the procedure. This problem has already been underlined in 2008 in the Commission Communication "Proceeds of organised crime". In particular the Communication mentioned that the certificate to request the execution of freezing orders was rather difficult to complete and it did not contain the necessary fields. This has also been confirmed by the results of the 2013 Comparative Law Study and the interviews conducted with Member States' authorities. As a result, there is a reluctance of practitioners to use the mutual recognition instruments. They often prefer to have resort to mutual legal assistance they are more familiar with, which continue to apply alongside the Framework Decisions on mutual recognition, provided that the Member States concerned are both parties to the relevant Conventions. Practitioners may also prefer MLA because the forms are less prescriptive compared to the mutual recognition instruments. Moreover, although the possibility for the executing Member State to refuse recognition or execution is an important element in the operation of the principle of mutual recognition, some of the grounds for refusal leave considerable discretion to domestic judicial authorities and/or lack justification. For example, the possibility to refuse execution based on the mere fact that the underlying offence was committed in the executing State's territory lacks appropriate justification. In addition, even if they contain provisions such as the obligation to execute an order "forthwith" or to inform, "whenever practicable", within 24 hours the Framework Decisions do not prescribe strictly defined time limits for the executing authorities. The Implementation Report from the Commission concerning Framework Decision 2003/577/JHA on the execution of freezing orders highlighted the various inconsistencies in the implementation of Art.5(3) of Framework-Decision 2003/577/JHA in the Member States: some Member States have provided different time limits, some Member States have not laid down any concrete time limits, some Member States have not at all implemented this specific provision and other Member States have not implemented the Framework Decision at all. These inconsistencies as regards delays, which are particularly problematic for freezing orders, have been repeatedly criticized by practitioners and identified as one of the problems which needs to be resolved. 4.3.3.Specific problem 3: Inconsistent implementation of existing mutual recognition instruments into national law Another barrier to the effectiveness of the EU legal framework on mutual recognition arises from the inconsistent transposition of the existing relevant rules into national law. The legal instruments adopted in this field are not directly applicable in Member States and have to be transposed into national law before they can take effect at national level. The Commission issued implementation reports on Framework Decisions 2003/577/JHA on the mutual recognition of freezing orders and 2006/783/JHA on the mutual recognition of confiscation orders. These reports show that (i) a number of Member States had not transposed these instruments by the deadline, and (ii) the transposition by many Member States has not complied with all of the requirements of the EU instruments. This further hampers the possibilities of judicial cooperation and reduces mutual trust. Before the entry into force of the Lisbon Treaty on 1 December 2009, no infringement proceedings could be initiated against Member States by the Commission for failure to transpose the Framework-Decisions into national law. The situation has improved since 1 December 2014 with the Court of Justice of the European Union having full jurisdiction in matters pertaining to the former third pillar. However, it should be underlined that the inconsistent implementation of existing instruments is only a secondary problem and that a complete and correct implementation of the existing legal framework would not be sufficient to address the problems explained above under section 4.3.1 and 4.3.2 (too limited scope of the obligation to recognise under the existing instruments and too complex and lengthy procedures and certificates); inconsistencies which exist in the current Framework Decisions would remain. Overview Table: General problem 1 – Insufficient recovery of criminal assets in cross-border cases Elements related to the current legal framework Elements related to the implementation of the current legal framework 1. Limited scope of the current Framework-Decisions in terms of types of confiscation covered:

- cases of illness or absconding not covered,

- NCBC including civil and administrative not covered,

- extended confiscation covered but subject to large possibilities to refuse execution. 2. Inefficient procedures: e.g. time limits for freezing are not mandatory, no time limits for confiscation 3.Complicated certificates for practitioners 4. Nature of the instrument: Framework-Decisions leave large discretion to Member States and are not directly applicable 1. Lack of transposition of the Framework-Decisions by their deadlines or only partial transposition by Member States. 2. Compliance issues: requirements of the Framework-Decisions are not always complied with (e.g. additional grounds for refusal) 4.4.General problem 2: The current mutual recognition instruments do not contain provisions on victims' compensation and restitution The second general problem which should be addressed with the current initiative is related to the compensation and restitution of victims. The current European legal framework for the protection of the rights of victims in the context of freezing and confiscation proceedings is insufficient in this respect. Without effective cross-border recovery of criminal assets, victims are denied the means to get restitution or compensation for their losses in cross-border cases in Member States where confiscation is used by the State for that purpose. Often the victim's only possibility to get back the losses suffered is to obtain restitution or compensation directly from the confiscated property. This is because the perpetrators often do not have enough lawfully acquired assets from which the restitution or compensation to the victim could be made. It is therefore necessary to facilitate victims' access to restitution and compensation from the confiscated property also in cross-border cases. The compensation of victims of crime for losses suffered is not further harmonised across the European Union, except for general and limited in scope obligations in the Victims' Rights Directive (Directive 2012/29/EU establishing minimum standards on the rights, support and protection of victims of crime) and in the Compensation Directive (Directive 2004/80/EC relating to compensation to crime victims). The Victims' Rights Directive provides that victims of crime are entitled to obtain a decision on compensation by the offender within a reasonable time, and leaves to the Member States the organization of practicalities. Regarding restitution, the Victims' Rights Directive establishes an obligation for Member States to ensure that, following a decision by a competent authority, recoverable property which is seized in the course of criminal proceedings is returned to victims without delay. The Compensation Directive does not deal with compensation of victims from offenders but regulates compensation from the State. It requires that fair and appropriate compensation schemes are in place in all Member States to compensate victims of violent intentional crimes committed in their territories. Members States are required to cooperate in order to facilitate access to compensation for their residents who have fallen victims to crime in another Member State. However, organization and functioning of the national compensation schemes (in terms of differences in definitions, eligibility criteria, financial capacity, interdependences with civil claims against the offender and existence of advance payment to victims which later can be reclaimed/seized from the offender) are entirely governed by the national rules on compensation and fall outside the scope of the Compensation Directive. On the other hand, none of the Framework Decisions contains any provision on victims. Framework Decision 2003/577/JHA provides only for a possibility to freeze property for purposes of confiscation, but not with a view to safeguard the victim's right to restitution. Framework Decision 2006/783/JHA on mutual recognition of confiscation orders does not address the rights of the victim either.

In some Member States, the relevant authorities can or must take action for the purpose of restitution or compensation of victims. This may include the duty to freeze and confiscate property on behalf of the victim or granting the victim priority on the confiscated property. In these latter cases, the Member States concerned have experienced difficulties in cross-border cases. The general rule established by Framework Decision 2006//783/JHA is that where money is obtained from the execution of the confiscation order, the amount obtained shall be shared 50%-50% between the issuing and the executing State. For amounts of less than EUR 10.000, the money accrues entirely to the executing State. Where property other than money has been obtained, it is up to the executing State to decide what to do with the property, e.g. to sell it. In all cases, there is a possibility for issuing and executing State to agree otherwise, and this has been used in the past to compensate victims or to restitute property, but as this depends on the States' agreement on a case-by-case basis, victims have no corresponding right to enforce another repartition or solution. In practice, this means that e.g. the authorities of Member State A are able to freeze and confiscate assets in this Member State and give them back to the victim, but if the perpetrator has hidden those assets in Member State B, the authorities of Member State A do not have the legal tools to ensure that the assets are returned to the victim. Thus the victim may be significantly worse off. Example 9 000 euros were stolen from the victim in Finland and the offender has moved the money to Germany. The judge in Finland issues a national confiscation order for the money and orders the full amount to be restituted to the victim. The confiscation order is enforced in Germany. However, as the amount is under 10 000 euros, under the current Framework Decision 2006/783/JHA there is no duty for Germany to return the money to Finland and the victim may not receive the restitution. If, in the example above, the stolen amount were higher, e.g. 30 000 euros, under the current Framework Decision Germany could keep 50 % of it (15 000 euros) instead of returning the full amount to be restituted to the victim, unless it agrees otherwise. 4.5.The scale of the problem 4.5.1.The scale of criminal activity Even if it is difficult to have precise and reliable data, one can safely assume that criminal activity generates large income, be it worldwide or in the European Union. According to estimates by the United Nations office on Durgs and Crime (UNDOC), criminal proceeds reached USD 2,1 trillion corresponding to 3.6% of global gross domestic product (GDP) in 2009. The French body in charge of recovering and managing recovered criminal proceeds, AGRASC, estimates that €1,2 trillion of criminal money circulates throughout the world economy each year. Recent research from a consortium around the Transcrime Institute (Savona & Riccardi, 2015) estimates that the main illicit markets in the European Union generate about € 110 billion per year, which corresponds to approximately 1% of the EU GDP in 2010. Comparatively, in the United States, it is estimated that the criminal income amounted in 2010 to USD 300 billion, which represents 2% of the United States GDP. Table 3- Estimate of criminal revenues in EU 28 Member States EU Member State Estimate* (million euro) % of GDP (2010) Austria 3.246 1,1% Belgium 2.516 0,7% Bulgaria 565 1,6% Croatia 134 0,3% Cyprus 324 1,9% Czech Republic 1.317 0,9% Denmark 1.555 0,7% Estonia 180 1,2% Finland 1.084 0,6% France 16.010 0,8% Germany 17.645 0,7% Greece 3.583 1,6% Hungary 1.102 1,1% Ireland 1.708 1,1% Italy 15.994 1,0% Latvia 614 2,8% Lithuania 455 1,6% Luxembourg 161 0,4% Malta 93 1,4% Netherlands 3.427 0,8% Poland 2.584 0,7% Portugal 1.072 0,6% Romania 2.308 1,9% Slovakia 882 1,3% Slovenia 379 1,1% Spain 10,835 1,0% Sweden 2.133 0,6% United Kingdom 15.141 0,9% EU 28 109.521 0,9% Source: Transcrime, From illegal markets to legitimate business: the portfolio of organised crime in Europe", Table 6 http://www.ocportfolio.eu/_File%20originali/OCP%20Full%20Report.pdf (2015) A 2015 study of project OCP examines infiltration by organised crime in seven European countries (Finland, France, Ireland, Italy, the Netherlands, Spain and UK). With data of only these seven Member States covered by the study, almost 5000 instances of criminal infiltrations were detected, many of them involving investments in other countries. 4.5.2.The scale of freezing and confiscation in the European Union There are very few data sets available which attempt to estimate assets confiscated as a percentage of criminal proceeds, and they vary significantly. The UK's National Audit Office estimated the amount confiscated for every 100 GBP of criminal proceeds to be 26 pence – i.e. according to this calculation the amount confiscated is just over one quarter of one percent (0,26%). The NAO’s head concluded from these figures that the "use of confiscation orders to deny criminals the proceeds of their crimes is not proving to be value for money." The results of a survey carried out by Europol on criminal asset recovery in the EU and published on 1 July 2016 conclude that 98,9% of estimated criminal profits are not confiscated and remain at the disposal of criminals. In the period analysed by Europol, 2,2% of the estimated proceeds of crime were provisionally seized or frozen, however, only 1,1% of the criminal profits were finally confiscated at EU level. That means that around 50% of all provisionally frozen assets are ultimately confiscated. The Europol study estimates that the annual value of provisionally frozen assets in the EU is around € 2,4 billion, with about € 1,2 billion finally confiscated each year at EU level. Another study by Dataninja estimates that in 2014, goods worth € 4 billion were taken away from criminal groups in the EU (or € 2 billion only for France, Italy, Germany, Spain, England and Wales). If compared to the estimated € 110 billion of main illicit markets in the EU (see above), this corresponds to 3,6%. Table 4– value of confiscated goods 2014 EU Member State Value of confiscated goods (million euro) Estimated criminal revenues (million euro, see table 3 above) % of criminal revenue confiscated France 382 16.010 2,4% Italy 776 15.994 4,85% Germany 251 17.645 1,4% United Kingdom 412 15.141 2,72% Spain 46 10.835 0,42% EU 28 4.000 109.521 3,65%

Sources: Confiscated Goods – The Dark Billions: A whole investigation on criminal investments seized by EU Countries, Dataninja.it, 16 December 2015, http://eu.confiscatibene.it/ ; Transcrime, From illegal markets to legitimate business: the portfolio of organised crime in Europe", Table 6 http://www.ocportfolio.eu/_File%20originali/OCP%20Full%20Report.pdf (2015) This data shows that Italy and UK, which have introduced non-conviction based forms of confiscation, are more successful in confiscating criminal assets than Member States with traditional forms, even though the percentages still remain woefully low in all cases. Despite the lack of availability of robust and comparable data sets, there are encouraging statistics which show that in many Member States, the number and/or value of assets confiscated is increasing. This is supported by the 2015 study of project OCP with a focus on 7 European countries (Finland, France, Ireland, Italy, the Netherlands, Spain and UK). In the United Kingdom in 2006 £125 million were recovered by the State; in 2009, confiscated assets amounted to £154 million. Between 2010 and 2013/2014, more than £746 million of criminal assets have been seized, and over £2,5 billion worth of assets have been frozen. £93 million have been returned to victims. 4.5.3.Cross-border confiscation and freezing Data is even less systematically collected in relation to freezing and confiscation orders requested and implemented across EU borders, and the few figures available have to be interpreted with caution. A EU study of November 2013 suggested that the number of freezing and confiscation orders currently sent and implemented across Member State borders has increased in recent years, but this is against a very low starting point. Another indication that cross-border cooperation is increasing is that Asset Recovery Office (ARO) to ARO asset tracing requests using the secure Europol SIENA communication channel are increasing. From 2012-2015, the messages exchanged per year increased from 452 to 3703. 46% of these exchanges result in the actual identification of assets. This increase will result in time in more cross-border freezing and confiscation, but according to Europol sources, is not yet adequately reflected by an increase of cross-border asset recovery cases. According to a presentation made by an Adviser to the UK Crown Prosecution Service, the trend is continuing, at least in the UK in its relations with third countries (which include EU Member States): in 2013, £3 million were returned by UK to third countries following confiscation. In 2014-2015, the amount had already increased to £16 million. In 2015-2016 (2nd quarter), the amount was £29 million. This increase reflects the particular efforts deployed by the UK to make its asset recovery system more effective, not only in its legal provisions. Similar efforts are lacking in most other Member States. The increase of cross-border freezing and confiscation orders shown by these figures is a positive trend; the increase in cross-border confiscation seems to be faster than the increase in cross-border criminality. However, despite this increasing tendency, requests to freeze and confiscate assets are still very low in comparison with other requests for co-operation, and there is still significant scope for improvement. In 2013, for example, the Irish Central Authority dealt with 584 requests for assistance and transmitted 200 requests. Of the 784 requests, only 5 involved requests for freezing and confiscation (all incoming). The UK, where both Framework Decisions only came into force in 2015, received 5 confiscation requests under the Framework Decision 2006/783/JHA since. This compares to a total of 37 "old style" MLA freezing requests received in 2014, which is also quite low. Feedback from stakeholders consulted confirms that only very few freezing and confiscation orders are executed in other Member States, compared to some other mutual recognition instruments. Examples 1. Statistics on mutual recognition instruments collected by the Polish Ministry of Justice show that in 2014 there were only 2 requests for confiscation issued and no requests for freezing. In comparison, that same year Poland issued 3838 requests to EU MS to surrender a person on basis of the EAW (of which 3723 cases were settled). 2. A similar tendency results from figures provided for by the NL. In 2014 they received 12 requests for execution of a confiscation order from another Member State whereas 832 surrender proceedings under the EAW were initiated. In the same year, the NL issued 13 requests for confiscation and 544 requests under the EAW. Based on this information, it is estimated that currently, there are between 168 and 280 cross-border mutual recognition requests for confiscation orders, and between 448 and 560 MLA requests in the European Union (cf. Table 6 in section 7.5 and Annex 7). Member State authorities are unlikely to send confiscation orders to another Member State if they know that they will not be executed, but this is difficult to quantify, as no Member State keeps statistics on the number of orders that they would have sent, had a different outcome been anticipated. 4.5.4.Cross-border confiscation and victims compensation The scale of the second general problem is more limited than the scale of the first general problem. It is more relevant for those Member States where the victim's right for restitution or compensation is secured by the authorities competent in the criminal procedure or where the victim is granted priority on the confiscated property. Given the lack of data, there are, however, no concrete figures available. 4.6.Baseline scenario: how would the problem evolve in the future if no EU action takes place? The baseline scenario or status quo indicates how the identified problem is likely to evolve without additional public intervention, taking into account existing and forthcoming interventions and following the entry into force of the Lisbon Treaty. The status quo option would likely result in an increase in the assets owned or controlled by criminal organisations, as well as an increase in their acquisitions of assets in other Member States. Evidence of a progressive increase in cross-border criminality and in the cross-border acquisition of assets can be derived from recent studies and investigative sources. The threat assessments issued by Europol show an increasing trend in cross-border criminal activities and in the links between criminal organisations located in different regions. The effects of globalisation in society and business have facilitated the emergence of significant new variations in criminal activity and criminal networks exploit legislative loopholes, notably in cross-border situations, to generate illicit profits.

The expected increase in the cross-border acquisition of criminal assets would be mitigated to some extent by the increase of the amounts frozen or seized, of the amounts confiscated, of the amounts recovered and of the cases where mutual recognition of orders issued in another Member State is successful. However, even if data suggest that cross-border cooperation is increasing, it is not very likely that the number of confiscation orders issued and recognised on a cross-border basis would increase sufficiently to become a true deterrent for crime. Whereas recent figures show that the money flows from criminal activities have considerably increased over the last 10 years, the freezing and confiscation of assets notably in cross-border cases remains very low, and the existing increase is certainly not exploiting the full potential of asset recovery. Calculations of the turnover of transnational crime of 20 OECD countries using the MIMIC estimations (1995-2014) Year Volume of money laundering (billion USD, 20 OECD countries) Volume of money laundering in % GDP 20 OECD countries 1995 273 1.33% Australia, Austria, Belgium, Canada, Denmark, Germany, finland, France, Greece, Great Britain, Ireland, Italy, Japan, Netherlands, New Zealand, Norway, Portugal Switzerland, Spain and USA 2000 384 1.47% 2001 412 1.52% 2002 436 1.56% 2003 475 1.63% 2004 512 1.66% 2005 561 1.72% 2006 603 1.74% 2007 646 1.77% 2008 702 1.82% 2009 680 1.60% 2010 708 1.78% 2011 741 1.96% 2012 804 2.07% 2013 859 2.15% 2014 907 2.20% Source: Own calculations, calibrated figures from the MIMIC estimations, Linz, November 2015, Professor Dr. Friedrich Schneider It is expected that the implementation of Directive 2014/42/EU across Member States will result in larger amounts of criminal assets being confiscated than at present. This effect may be even stronger if Member States go beyond the Directive when reforming their asset recovery regimes. It may also have a positive impact on cross-border cooperation for those forms of confiscation in respect of which the Directive sets common minimum standards (for example, extended powers of confiscation, third-party confiscation and the cases of illness and absconding of the suspect or accused person), but as the mutual recognition instruments are not aligned with the scope of the Directive in terms of types of confiscation orders covered, there is no obligation for Member States to recognise all confiscation orders which are now made possible by the Directive. This means an increased number of extended or other orders will be issued after transposition of the Directive, but they may remain unexecuted when assets are located in other Member States. Moreover, the launch of infringement proceedings against those Member States that have not yet or not correctly transposed the two Framework Decisions (legally possible since 1 December 2014), would not address the identified problems. The scope of the two Framework Decisions does not cover more recent types of confiscation orders and certain provisions are vague, giving rise to different interpretations. Ensuring compliance with the current legal framework through infringement proceedings would not allow addressing the main problems which affect the proper functioning of mutual recognition of freezing and confiscation orders in the European Union. As a consequence, the strengthening of the legal framework on mutual recognition of national freezing and confiscation orders becomes even more important and relevant. Besides the mutual recognition instruments, as mentioned above, Member States also still make use of instruments of intergovernmental cooperation: mutual legal assistance requests, including cooperation under international conventions. These may be very flexible, but they bring the disadvantages of intergovernmental cooperation: it is slow and depends entirely on the goodwill of the requested party. There is no obligation upon the requested authority to execute a request for mutual legal assistance. Moreover, in the area of asset recovery it is vital for States to have the ability to respond very quickly: criminals are able to move assets across borders extremely quickly, sometimes with a few clicks on a computer or a phone. By contrast, methods of obtaining Mutual Legal Assistance ('MLA') are much slower – on average, the duration for execution of a MLA request in the EU is one year -, often creating administrative burden and coupled with uncertainty because of the wide discretion States enjoy to execute a request or not. The work of international organisations, for example the Council of Europe ('CoE') with regard to the Convention on Laundering, Search, Seizure and Confiscation of the Proceeds from Crime and on the Financing of Terrorism ('Warsaw Convention'), might slightly improve cross-border cooperation based on MLA. This Convention obliges signatories to put in place domestic measures to criminalise certain conduct, and to adopt measures to enable the seizure of criminal assets. It also requires parties to provide judicial cooperation "to the widest extent possible (…) for the execution of measures equivalent to confiscation (…) which are not criminal sanction (…)" (e.g. civil or administrative forms of NCBC). However, because the Convention sets minimum standards, because not all Member States are signatories to this instrument, and because there is a wide discretion to refuse requests (with the attendant reduction of legal certainty), the coverage offered by the Warsaw Convention is and will remain limited. Moreover, a drawback of international conventions such as the Warsaw Convention is the lack of mandatory deadlines. As stated above, in its Action Plan on combatting Transnational Organised Crime of 2 March 2016, the Council of Europe proposes actions to improve implementation of this Convention, e.g. by launching training programmes covering some of the most recent forms of confiscation. Such actions would contribute to improvements in practice, but the above-mentioned limitations of the Convention would nevertheless persist. Moreover, the parallel use of two different systems, the mutual recognition instruments and the international conventions, with different rules, forms and procedures, depending on which type of confiscation order and which executing Member State is concerned, creates additional complexity that does not help practitioners. They have to get familiar with two sets of rules, procedures and forms and may continue to prefer the traditional MLA route. As a result, chances to seize more assets from criminals and to make asset recovery a true deterrent for crime will continue to be missed. At least no significant changes to the current situation where "crime does pay" could be achieved by sticking to the status quo. The main advantage of the baseline scenario is that there would be no additional burden on national administrations. Practitioners would not need to become familiar with new process and laws. There would be no change concerning the fundamental rights of persons concerned by asset recovery measures. However, looking at it from a broader perspective, this option would negatively affect the fundamental rights of persons who are or may become victims of crime. Member States would increasingly be left behind by criminals. Under this option, there would be no impact on domestic justice systems. 4.7.Does the EU have power to act? 4.7.1.Legal basis

The power to act and, where necessary, propose EU legislation in the area of criminal law is conferred, inter alia, by Articles 82 and 83 of the Treaty on the Functioning of the European Union (TFEU) . More specifically, the legal basis to support action in the field of mutual recognition of criminal assets' freezing and confiscation orders is Article 82(1) TFEU, which specifies inter alia that judicial co-operation in criminal matters in the Union shall be based on the principle of mutual recognition of judgments and judicial decisions. Measures may be adopted in accordance with the ordinary legislative procedure to lay down rules and procedures for ensuring recognition throughout the Union of all forms of judgments and judicial decisions, and to facilitate cooperation between judicial or equivalent authorities of the Member States in relation to proceedings in criminal matters and the enforcement of decisions. 4.7.2. Subsidiarity: Why is the EU better placed to take action than Member States? Under Article 5(3) TEU, the Union shall only act if the proposed action cannot be sufficiently achieved by the Member States. Article 67 TFEU provides that the Union shall provide citizens with a high level of security by preventing and combating crime. The assets of organised criminal groups are frequently invested in several countries. This double cross-border dimension (of organised crime activities and their multi-country investments) justifies European action. While cross-border criminal and asset investigations may occur in several countries, prosecution and the judicial activities leading to confiscation normally take place in only one Member State and thus confiscation procedures remain essentially national. However, their cross-border dimension is evident in the enforcement of orders in other Member States. Thus, asset recovery requires effective cooperation among Member States. The most effective way of ensuring cross-border co-operation is on the basis of mutual recognition. Mutual recognition is in accordance with the principle of subsidiarity since it aims at recognising each other's decisions without full harmonisation of national rules, and cannot be achieved by Member States acting alone. Moreover, the penetration of organised crime into the economy of one Member State affects the functioning of the whole EU Internal Market. Even when managing licit businesses, organised crime groups often support these activities with the recourse to intimidation and corruption, thus altering competition and the smooth functioning of the Internal Market. The resulting loss of revenues affects both national and EU financial interests, even when it takes place in only one Member State. More broadly, the free movement of persons and capitals within the Union entails a need for action at supra-national level in enforcing judicial decisions, including those on asset freezing and confiscation. 4.8.Fundamental Rights Confiscation measures may have a considerable impact on the fundamental rights of the person(s) concerned, such as the right to property or the right to family and private life. Particular attention needs to be given to ensure that any interference is based on the principle of legality and proportionality and that other fundamental rights, such as procedural safeguards and the right to an effective judicial remedy, are respected (see Annex 6). Depending on how confiscation is used and in which setting it operates, different fundamental rights may be relevant. Moreover, the applicable fundamental rights may also vary with regard to freezing of assets. For example, the freezing of assets is not a deprivation of property within the meaning of the first paragraph of Article 1 Protocol 1 of the ECHR, however, confiscation is. The complexity is further increased when confiscation extends to third party assets. A balancing of rights is needed to avoid that fundamental rights, such as defence rights, are put at risk when applying confiscation measures. It is essential that any new legal instrument enhancing the mutual recognition of freezing and confiscation orders is fully in line with the ECHR, the case-law of the ECtHR and the Charter of Fundamental Rights of the European Union. A detailed analysis of the impact of the various options on fundamental rights is carried out in the assessment of the options and their comparison (see below sections 7 and 8), the relevant case-law is set out in Annex 6. This analysis was carried out taking into account the Opinion of the European Union Agency for Fundamental rights on the Confiscation of proceeds of crime as well as opinions and presentations made by specialists during expert meetings. 5.Objectives Based on the problem analysis and the EU's current legal framework in the field of asset recovery and in line with relevant policy strategies (notably the European Agenda for Security of 28 April, 2015 and the Commission's Action Plan for strengthening the fight against terrorist financing), the following general and specific objectives have been identified: Objectives: General objective: To freeze and confiscate more assets deriving from criminal activities in cross-border cases in order to prevent and combat crime, including terrorism and organised crime To enhance the protection of victims' rights in cross-border cases. Specific objectives: To improve the mutual recognition of freezing and confiscation orders in cross-border cases by extending the scope of mutual recognition instruments; To provide simpler and faster procedures and certificates. To increase the number of victims receiving cross-border compensation. 6.Policy options The policy options for addressing the problems as defined in part 4 of this Impact Assessment, in line with the objectives as established in part 5, are set out below. 6.1.Discarded Options The following policy options have not been retained for further in-depth assessment: a) Codification of the existing Framework Decisions 2003/577/JHA on the execution of freezing orders and 2006/783/JHA on confiscation orders into one legal instrument: Although this option would lead to a consolidation and certain simplification of the existing rules it would be too limited in its scope and not take into account recent developments at EU level and at national level (see above section 3.5 and 4.2.1).

b) Limitation of the scope to specific offences (e.g. "eurocrimes"): As the current legal mutual recognition framework already covers cooperation in respect of all criminal offences, it would not be coherent to limit the scope of a new legal instrument to the so-called "eurocrimes". This would lead to different regimes (one for eurocrimes and one for other offences) for mutual recognition, which would go against the objective of simplification of the current framework. On the contrary, it would add complexity to the system and hamper its practical effectivity. Even if the Directive 2014/42 can only cover Eurocrimes, an alignment with the Directive in terms of offenses would not bring any added value for the mutual recognition legal framework. Furthermore, this would result in an exclusion of many criminal offences which are relevant for confiscation as they can generate considerable gains. . It should also be recalled that the legal basis for mutual recognition (Art. 82 TFEU) is not limited to eurocrimes, contrary to the legal basis for harmonisation measures (Art. 83 TFEU). c) Empowering all Asset Recovery Offices to also manage frozen assets could increase efficiency and promote best practices. However, this option is not directly linked to the strengthening of mutual recognition of freezing and confiscation orders and was discarded. 6.2.Description of the policy options 6.2.1.Option 1: Maintaining the status quo See above, Section 4.6 – The size of the problem/Baseline scenario 6.2.2.Option 2: Non-regulatory option A non-regulatory option could consist of two main elements: a) Periodic evaluation of judicial cooperation in the area of confiscation There is no obligation in the current framework decisions to conduct periodic evaluations of the instruments. Under option 2 the Commission would collect in a systematic manner information on judicial cooperation and mutual recognition of confiscation orders. Directive 2014/42/EU provides for an obligation upon Member States to regularly collect and maintain comprehensive statistics on freezing and confiscation orders. The information collected would be used to prepare periodic national and EU level evaluation reports which would go beyond the reporting obligations foreseen by Directive 2014/42/EU (which foresees in Article 13 a report on the impact of the existing national law on confiscation and asset recovery). These reports could also contain "general lessons learned". This could be done through a specific network of experts that would collect relevant material in each Member State, or through studies in this area. Such reports would be disseminated to stakeholders involved at policy and implementation level and would also be published on the Commission's website. b) Support the training of law enforcement and judicial authorities The Commission would enhance and intensify training measures for law enforcement and judicial authorities to promote and improve the application of relevant legislation, e.g. via the European Judicial Training Network. Regular workshops to exchange best practices and seminars would be organised and coordinated and peer review meetings with Ministries of Justice would be held. Those activities should involve key players such as Eurojust and the European Judicial Network. The information collected would be widely disseminated on a dedicated website of the Commission and through existing networks and EU dedicated agencies. - Stakeholder views In the recent expert meeting of 17 November 2016 Member States have generally acknowledged the need to improve mutual recognition of freezing and confiscation orders with a new legislative instrument. They expressed the view that neither the Status quo nor option 2 would adequately address the problems identified. The European Parliament has also repeatedly asked for a new legal instrument and would therefore not be in favour of option 2. There was also a large consensus on the side of practitioners (including judges, prosecutors, representatives from Europol and Eurojust) that a soft law option would be insufficient to increase cross-border freezing and confiscation. Thus, this option would go against the expectations of stakeholders expressed in the different meetings. 6.2.3.Option 3 – Minimal regulatory option Option 3 goes further than option 2 and consists of codifying the existing two Framework decisions 2003/577/JHA on the execution of freezing orders and 2006/783/JHA on confiscation orders into one legal instrument, while at the same time aligning its scope with that of Directive 2014/42/EU in terms of types of freezing and confiscation measures covered (including extended confiscation and some limited forms of criminal non-conviction based confiscation). Option 3 could also be combined with elements b) and c) of Option 2. Unlike Directive 2014/42/EU, the new instrument under option 3 would cover all criminal offenses and not be limited to the Eurocrimes as the legal basis of the new instrument would be Article 82 TFEU which does not require limiting the scope of mutual recognition to such crimes. Furthermore, such a limitation would create additional complexity for practitioners. Option 3 would also include the introduction of simplified mutual recognition certificates and, for freezing orders only, possibly a "European Asset Freezing Order". Such a European Asset Freezing Order would be issued specifically for the purpose of mutual recognition in another Member State without the need for issuing a national freezing order first. It would be justified by the urgent nature of freezing and the need to simplify procedures.

Option 3 would also define short mandatory deadlines for the recognition and execution of freezing orders, and introduce harmonised grounds for refusal based on fundamental rights. Finally, option 3 could foresee specific rules on the restitution and compensation of victims. Member States would be required to duly take into account victims' rights (notably the executing State). In the case of a decision taken by the issuing Member States to restitute the property to the victim, the executing authority should ensure that the property is restituted or, where not possible, the value of the property should be returned to the victim. If a decision is taken to compensate the victim, the corresponding sum should accrue to the issuing Member State for the purpose of compensation of the victim (whereas under the current legal framework there is a 50% division between the executing and issuing State of the amount obtained from the execution of a confiscation order if the amount is over € 10000). - Stakeholder views In the recent expert meeting of 17 November 2016 Member States have generally acknowledged the need to improve mutual recognition of freezing and confiscation orders with a new legislative instrument. Option 3 could be supported by nearly all Member States and was considered as the "absolute minimum" option to be proposed by the Commission. It would not raise any particular concerns from Member States. However, it became also clear during the expert meeting that a more ambitious approach than option 3 was generally considered as more appropriate. In particular those Member States which have more extensive forms of NCBC would like to have their domestic freezing and confiscation orders recognised and executed throughout the EU. The European Parliament is generally in favour of a legislative proposal to strengthen the mutual recognition of confiscation and freezing orders. This was clearly expressed already in 2014 when the Directive 2014/42/EU was adopted and reiterated more recently in the so-called Ferrara Report of October 2016. However, the European Parliament has never taken position on specific options. Opinions of legal practitioners (judges, prosecutors) have diverged on what kind of measures a new EU instrument should cover. Several experts expressed that unless there is more harmonisation in this area, a mutual recognition instrument should be limited in scope (corresponding to options 3 or 4a as a maximum). Defence lawyers were generally rather critical as regards a possibly wider scope of a new mutual recognition instrument. They spoke in favour of a more limited option which provides for appropriate procedural safeguards. 6.2.4.Option 4 –Medium and Maximal regulatory option Policy option 4 would consist in the adoption of a new mutual recognition instrument that would address most or all deficiencies identified for the existing instruments. It would notably include within its ambit all freezing orders and all confiscation measures (conviction based and non-conviction based) which meet certain stringent minimum standards, particularly including strong fundamental rights standards. As under the minimal regulatory policy option, the new instrument would cover all criminal offenses. Moreover, this option would also provide for simplified mutual recognition certificates and, for freezing orders only, possibly a "European Asset Freezing Order" as set out under option 3. Option 4 would also define short mandatory deadlines for the recognition and execution of freezing orders and introduce harmonised grounds for refusal based on fundamental rights.. Option 4 would also allow victims to benefit from asset recovery in cross-border cases. In this respect Option 4 would be identical to option 3. Two sub-options can be distinguished: Sub-Option 4(a) Medium option Under this option, the types of freezing and confiscation orders which can be recognised would be all those which are issued in the context of criminal proceedings. This would go beyond an alignment with Directive 2014/42/EU and cover all types of criminal confiscation, including criminal non-conviction based confiscation (such as in the case of death of a person, immunity, prescription, cases where the perpetrator of an offence cannot be identified or where a criminal court can confiscate an asset in the absence of conviction when the court is convinced that such asset is the proceeds of crime). Example The draft German law transposing Directive 2014/42/EU contains provisions for so-called "autonomous confiscation". It allows a criminal court to confiscate an object in the absence of a conviction, if, based on all circumstances of the case, the court is convinced that an object is the proceeds of a crime, even if the person affected by the confiscation cannot be prosecuted or convicted for this crime. However, this option would not cover civil or administrative forms of confiscation. Sub-Option 4(b) Maximal option The second sub-option would extend the obligation to recognise confiscation orders beyond those covered by option 4(a) to those made in civil or administrative proceedings where it is shown that the property is the proceeds of criminal conduct.

Example As a response to Mafia, Italy has introduced so-called preventative freezing and confiscation, which allows freezing and confiscation of assets without a conviction provided that the following conditions can be established: 1) previous or current dangerousness of a person; 2) availability of property without evidence of legitimate origin, when there is (a) a disproportion between the value of property and the stated income of the person or (b) sufficient evidence that the property is the proceeds of crime. The preventative confiscation is provided for in the anti-mafia code and is considered as an administrative measure, outside of the criminal code. In order to ensure that even in these civil and administrative proceedings, the procedural rights of the persons concerned are sufficiently protected, the recognition obligation should depend on the respect of certain fundamental rights safeguards. Such fundamental rights would include rules on the burden of proof, the right to a fair and public hearing, the potential to challenge evidence, the right of appeal and the right to an effective legal remedy. This sub-option would cover most of the existing confiscation regimes in the EU and would in particular allow those Member States that have civil non-conviction based confiscation in place to have those orders recognised in all other Member States. If option 4(b) is retained, it would have to be ensured that the scope of the new instrument is in line with the legal basis of Article 82(1) TFEU, which covers judicial cooperation in criminal matters. Option 4 could also be combined with elements b) and c) of Option 2. - Stakeholder views Option 4a appeared to be the most preferred option for those Member States which took the floor at the expert meeting of 17 November. Many Member States have the necessary legislation adopted or have draft laws pending. No particular concerns were raised. Some Member States clearly indicated that this would be their preferred option and also the maximum they could envisage. As regards the widest option 4b, which would include civil and administrative NCBC, the picture which emerged at the expert meeting was more diverse. Option 4b is likely to be supported by at least those Member States which have already such systems in their domestic legal order: IE, UK, BG, SK, SI and IT. Furthermore, FR, and NL have expressed that they are already now able to recognise civil NCBC orders. However, some Member States have clearly expressed that some far-reaching forms of NCBC would be more problematic, if they contravene fundamental principles of domestic law. ES has expressed constitutional issues with civil NCBC and reversal of burden of proof. EE has considered that jurisprudence by its Supreme Court sets limits to civil NCBC, however it may not oppose it in the context of mutual recognition. FI has expressed that only confiscation orders issued in criminal proceedings should be covered as criminal proceedings entail clear procedural safeguards. The European Parliament is generally in favour of a legislative proposal. However, the European Parliament has never taken position on specific options or on the possible scope of a new instrument. Members of Eurojust, Europol, judges and prosecutors have repeatedly pointed out during the above mentioned meetings or contacts that confiscation is a very efficient tool, in particular in the fight against organised crime such as drug trafficking. Many have noted that confiscation procedures are underused and that there is an increased need for effective international cooperation and mutual legal assistance on asset recovery. Opinions have diverged on what kind of measures a new EU instrument should cover. Several experts have underlined that national confiscation systems differ widely between EU Member States. Some have considered that if certain Member States do not have civil confiscation for constitutional reasons or fundamental rights reasons, it will be difficult for a judge to recognise a civil confiscation order and to execute it. Some expressed that unless we have more harmonisation in this area, a mutual recognition instrument needs to be limited. Others considered that mutual recognition is a good alternative to further harmonisation. Defence lawyers were generally rather critical as regards a possibly wider scope of a new mutual recognition instrument (notably as regards a possible extension to civil and administrative NCBC - corresponding to sub-option 4b) and underlined the need to ensure appropriate procedural safeguards and to take into account fundamental rights concerns. Some legal practitioners and academia from former communist countries have referred to experience from recent history where the state confiscated people's property unjustly and without ensuring fair proceedings and underlined the need for appropriate safeguards. Regulation or Directive The new legal instrument could be adopted in the form of a directive or regulation. Article 82(1) TFEU gives the EU legislator the choice: it does not limit the possible measures to directives but also allows for the adoption of regulations. Whereas a directive would give Member States some margin for transposition, national legislation might vary between Member States. As the proposal concerns cross-border procedures, there seems to be little need to leave this margin to Member States to adapt it to their national situation. A regulation would be directly applicable, would provide greater legal certainty and would avoid the transposition problems that the Framework Decisions were subject to. Table 5: Overview on how the regulatory options would meet the objectives of this initiative Specific objective 1: To improve the mutual recognition of freezing and confiscation orders by extension of scope of the mutual recognition instrument Option 3 Option 4 a) Option 4 b) Confiscation after criminal conviction ✓ ✓ ✓ Extended confiscation ✓ ✓ ✓ Confiscation from a third party ✓ ✓ ✓ Criminal NCBC absconding ✓ ✓ ✓ illness ✓ ✓ ✓ death ✓ ✓ other forms of criminal NCBC ✓ ✓ Civil and administrative NCBC (necessary link to a criminal conduct) ✓ Specific objective 2: faster and simpler procedures and certificates ✓ ✓ ✓ Specific objective 3: increase the number of victims receiving cross-border compensation ✓ ✓ ✓

7.Analysis of the impacts of the policy options The five policy option