A4-0263/96

Resolution on the follow-up to the interparliamentary conference on combating fraud against the Community budget (23 and 24 April 1996): for concerted action by the Union and the Member States

The European Parliament,

- having regard to Rule 148 of its Rules of Procedure,

- having regard to the report of the Committee on Budgetary Control and the opinions of the Committee on Civil Liberties and Internal Affairs and the Committee on Legal Affairs and Citizens' Rights (A4-0263/96),

A. recalling that the interparliamentary conference of 23 and 24 April 1996 on combating fraud against the Community budget was convened to establish the bases for necessary cooperation between national and Community authorities founded on:

- the common interest of the Union and the Member States, which are also affected by the financial and political harm caused by such fraud,

- decentralized allocation of responsibilities and competences between the two levels,

B. noting that the conference identified important loopholes in the legislation intended, at the national and Community levels, to protect Union finances,

C. considering that finding should be followed up by making specific proposals inspired by those principles and findings,

D. whereas the Intergovernmental Conference should be entrusted with the problem of providing the Treaty with the means of protecting the Community's financial interests at an equivalent level in an effective, proportionate and dissuasive manner,

E. whereas considerable progress has been achieved on legislation and administrative sanctions and controls, whereas, however, it is necessary to supplement the legislation on legal and judicial instruments for the protection of Community finances,

F. regretting, however, that criminal-law protection against fraud has been relegated to the third pillar,

G. considering that the fight against cross-border fraud and corruption should be conducted by multi-disciplinary bodies bound to one another by special links,

H. recalling that cross-border cooperation between the Member States and with the Commission is the only effective method of combating fraud by large criminal organizations which profit from the globalization of markets and differences between the national legal orders,

Harmonizing responsibilities and competences

1. Calls on the participants in the IGC to create within the Treaty the instruments that are essential for effectively prosecuting fraud, e.g.:

(a) a legal basis permitting the adoption of anti-fraud legislation under a codecision procedure;

(b) a duty to safeguard Community finances in the various Member States in an equivalent manner;

(c) the communitization of certain fields which are part of Title VI of the TEU (Justice and Home Affairs), such as those referred to in Articles K.1, K.7, K.8 and K.9 in so far as they concern protection of the Community's financial interests;

(d) an explicit reference in the Treaty to the 'fight against corruption' as a matter of common interest;

Supplementing legislation

2. Calls on the Commission to re-examine sectoral legal instruments with a view to harmonizing them with Regulation No 2988/95 on administrative sanctions and controls, in particular as regards exclusion from or withdrawal of the benefit in cases of irregularity;

3. Recommends the Member States, the Commission and the Council to establish more preventive rules to combat fraud and corruption, with the aim of increasing the transparency (and thus facilitating the monitoring) of revenue and expenditure of relevance to the budget and the associated decision-making processes;

4. Calls on the Council to press ahead speedily with its deliberations on the second additional Protocol to the Convention on the Protection of the European Communities' Financial Interests (concerning the liability of legal persons) and, in so doing, to take due account of the European Parliament's opinions, which it has yet to deliver;

5. Recalls that, if it proved impossible to obtain unanimous ratification of the convention on protecting the financial interests of the Community and any protocols which might follow it, it would get back its freedom of action and could ask the Commission to propose a Community initiative;

6. Recommends to the Members States and the Commission that, in partnership, they make more homogenous the following legal and judicial instruments, which could influence the protection of Community finances in the judicial proceedings and recovery stage:

- out-of-court settlements: this practice would be allowed exceptionally, never for amounts due or for intentional irregularities, and always on the basis of prior authorization of the Community authority, which would have to be systematically informed;

- bringing a private action for damages in parallel with criminal prosecution, which, in States where this action is not available, would have to be replaced by equivalent protection mechanisms;

- specialized bodies dealing with Community fraud, which could be established within Member States' prosecuting authorities and court systems;

- collection and recovery, which should be entrusted to the bodies primarily competent, acting according to harmonized procedures (compulsory communication to the Commission; Treasury debt and Community debt to enjoy equivalent privileges; uniform limitation periods), and monitored by a centralized Community service.

Consolidating the anti-fraud organization

7. Invites:

(a) the Member States to establish these multi-disciplinary bodies and to provide them with specialized staff;

(b) the Commission and the Member States to cooperate in implementing a vast training programme for investigators and in defining a legal instrument providing national investigators with comparable powers of investigation;

(c) the Commission to define more closely the role of the Unit for the Coordination of Fraud Prevention (UCLAF), which should be based on four pillars:

- systematic information about all fraud;

- coordination of national investigations;

- investigations initiated by UCLAF in cases of fraud;

- recovery/collection initiatives in cases of serious national shortfalls or if Community action is taken to set an example;

Creating bases for cooperation

8. Requests the Commission:

(a) to present proposals for the legislation it considers necessary to reinforce administrative cooperation;

(b) to propose, in the context of joint consideration with the Member States:

- a legal instrument governing cooperation on the pre-judicial suppression of fraud;

- an initiative to establish genuine judicial cooperation by eliminating existing legal barriers and giving a single country power to prosecute, and to regulate letters rogatory and their probative value.

9. Recommends the Council to define in a separate (horizontal) act general obligations on the Member States with the aim of removing existing substantive obstacles (such as the requirement of liability to punishment in both countries) to extradition and legal assistance in criminal cases and of facilitating and accelerating the procedures governing judicial cooperation among the Member States in criminal cases;

10. Considers that effective transnational cooperation must be based on the centralization of information and the coordination of acts by a Community body, such as UCLAF; requests the Commission, therefore, to provide for the UCLAF to play this role in the initiative designed to regulate administrative, police and judicial cooperation;

11. Considers that the application of letters rogatory would be facilitated by conferring a specific competence on a Community body, which would act at the request of the Member State competent for prosecution and in application of that State's law and calls on the Commission and the Member States to consider this subsequent development;

12. Calls on the Commission to study the question of bringing criminal proceedings in cases of offences harming the EU's financial interests, in particularly as a result of corruption of officials;

13. Instructs its President to forward this resolution to the Commission, the Council and to all participants in the interparliamentary conference and to the speakers of the various houses of parliament of the Member States.