Legislative resolution embodying Parliament's opinion on the draft second Protocol drawn up on the basis of Article K.3 of the Treaty on European Union, to supplement the Convention on the Protection of the European Communities' financial interests (7752/96 - C4-0137/96 - 95/0360(CNS)) (Consultation procedure)
Date: 1996-10-24
Institutions: Committee on Civil Liberties, Justice and Home Affairs, European Parliament
Subjects: Intergovernmental Convention (EU), fraud against the EU, judicial cooperation, legal person, legal process, money laundering, protocol to an agreement













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51996AP0313

Legislative resolution embodying Parliament's opinion on the draft second Protocol drawn up on the basis of Article K.3 of the Treaty on European Union, to supplement the Convention on the Protection of the European Communities' financial interests (7752/96 - C4-0137/96 - 95/0360(CNS)) (Consultation procedure)  


Official Journal C 347 , 18/11/1996 P. 0150 





A4-0313/96Draft second Protocol drawn up on the basis of Article K.3 of the Treaty on European Union, to supplement the Convention on the Protection of the European Communities' financial interests (7752/96 - C4-0137/96 - 95/0360(CNS))The draft was approved with the following amendments:Council draft Amendments by Parliament(Amendment 1)Title>Original text>Second Protocol drawn up on the basis of Article K.3 of the Treaty on European Union, to supplement the Convention on the protection of the European Communities' financial interests>Text following EP vote>Second Protocol drawn up on the basis of Article K.3 of the Treaty on European Union, to supplement the Convention on the protection of the European Communities' financial interests, concerning the liability of legal persons and money laundering(Amendment 2)Sole recital (new)>Text following EP vote>Whereas a separate instrument will determine the arrangements for assistance and judicial cooperation and also priority jurisdiction and the coordination provided by the Commission in cases of transnational fraud against the Union budget;(Amendment 4)Article 1(d)>Original text>(d) 'legal person' shall mean any entity having such status under the applicable national law, except for States or other public bodies in the exercise of State authority and for public international organizations.>Text following EP vote>(d) 'legal person' shall mean any entity having such status under the applicable national law, except for States or other public bodies in the exercise of State authority and for public international organizations, and any economically active enterprise in which independent rights and obligations are vested.>Text following EP vote>Member States shall ensure that, in accordance with their national law, the liabilities laid down in this second protocol are applied to those units of activity (with separate assets) which operate for legal purposes with apparent or de facto independence of their owners.(Amendment 5)TITLE II, heading>Original text>Legal persons>Text following EP vote>Liability of legal persons(Amendment 6)Article 2(1)>Original text>1. Each Member State shall take the necessary measures to ensure that legal persons can be held liable for fraud [and corruption] committed to their benefit by any person having power to take decisions or exercise control within the legal person as well as for involvement as accessories or instigators in or attempted commission of such fraud [or corruption].>Text following EP vote>1. Each Member State shall take the necessary measures to ensure that legal persons can be held liable under criminal or administrative law for fraud and corruption which is committed on their account and behalf by any person having de facto or de jure power to take decisions or exercise control within the legal person. Involvement as accessories or instigators in or attempted commission of such fraud or corruption shall be equated with their commission.(Amendment 7)Article 2(2)>Original text>2. Apart from the cases already provided for in paragraph 1, each Member State shall take the necessary measures to ensure that a legal person can be held liable where the lack of organization, supervision or control by a person referred to in paragraph 1 has made possible the commission of a fraud [or an act of corruption] on behalf of a legal person by a person under its authority.>Text following EP vote>2. Apart from the cases provided for in paragraph 1, each Member State shall take the necessary measures to ensure that a legal person can be held liable under criminal or administrative law where the lack of organization, supervision or control by a person referred to in paragraph 1 has made possible the commission of a fraud or of corruption on behalf of a legal person or for its account by a person under its authority.(Amendment 8)Article 2(3)>Original text>3. Liability of a legal person under paragraphs 1 and 2 shall not exclude criminal proceedings against natural persons who are perpetrators, instigators or accessories in the fraud [or corruption].>Text following EP vote>3. Liability of a legal person under paragraphs 1 and 2 shall not exclude criminal proceedings against natural persons who are perpetrators, instigators or accessories.(Amendment 9)Article 3(1)>Original text>1. Each Member State shall take the necessary measures to ensure that a legal person held liable pursuant to Article 2(1) is punishable by effective, proportionate and dissuasive penalties, including in particular the following penalties:>Text following EP vote>1. Each Member State shall take the necessary measures to ensure that a legal person held liable pursuant to Article 2(1) and (2) is punishable by effective, proportionate and dissuasive penalties, including in particular the following:>Original text>(a) payment of a fine;>Text following EP vote>(a) payment of a fine or administrative fine;>Original text>(b) exclusion from entitlement to public benefits or aid;>Text following EP vote>(b) exclusion from entitlement to public benefits or aid, or from participation in public procurement;>Original text>(c) temporary or permanent disqualification from the practice of commercial activities;>Text following EP vote>(c) temporary or permanent disqualification from the practice of commercial activities;>Original text>(d) placing under judicial supervision;>Text following EP vote>(d) placing under judicial supervision;>Original text>(e) a judicial winding-up order.>Text following EP vote>(e) a judicial winding-up order, if the purpose or essential activity of the legal person consists of fraudulent or corrupt activities.(Amendment 10)Article 3(2)>Original text>2. Each Member State shall take the necessary measures to ensure that a legal person held liable pursuant to Article 2(2) is punishable by effective, proportionate and dissuasive penalties or measures.>Text following EP vote>Deleted(Amendment 11)Article 3(3)>Original text>3. Each Member State may declare, when giving the notification referred to in Article [X](2), that it will not apply, or will apply only under special conditions, one or more of the penalties listed in paragraph 1(c), (d) and (e).>Text following EP vote>Deleted(Amendment 12)Title III, heading>Original text>Confiscation and laundering>Text following EP vote>Confiscation, dispossession or sequestration of unlawful gain, and money laundering(Amendment 13)Article 4>Original text>Each Member State shall take the necessary measures to enable it to confiscate instruments and proceeds of fraud or goods the value of which corresponds to such proceeds.>Text following EP vote>1. Each Member State shall take the necessary measures to enable it to confiscate instruments and proceeds of fraud or corruption or goods the value of which corresponds to such proceeds and transfer all or part of them to the budget of the European Union.>Text following EP vote>2. Each Member State shall take the necessary safeguard measures if there is reason to fear that confiscation pursuant to paragraph 1 may otherwise be jeopardized or rendered substantially more difficult. Such measures shall in particular include:(a) freezing of accounts(b) seizure of property(c) prohibiting the alienation or encumbrance of immovable property.(Amendment 14)Article 5>Original text>Each Member State shall take the necessary measures to establish as a criminal offence laundering as defined in Article 1 of Council Directive 91/308/EEC of 10 June 1991 on the prevention of the use of the financial system for purposes of money laundering, of the proceeds of fraud, at least in cases of serious fraud within the meaning of Article 2(1) of the Convention.>Text following EP vote>Each Member State shall take the necessary measures to establish as a criminal offence laundering, as defined in Article 1 of Council Directive 91/308/EEC of 10 June 1991 on the prevention of the use of the financial system for purposes of money laundering, of the proceeds of fraud or corruption, at least in cases of serious fraud within the meaning of Article 2(1) of the Convention and comparable serious corruption cases.>Text following EP vote>Each Member State shall take the necessary measures to ensure that legal persons can be held liable for laundering the proceeds of fraud. In such cases the penalties laid down in Article 3(1) shall apply. The liability of the legal person shall not exclude criminal proceedings against the natural persons who have carried out acts of laundering on behalf of the legal person.(Amendment 15)Article 6(1)>Original text>1. Member States shall provide mutual assistance for all judicial proceedings relating to fraud in accordance with Article 6 of the Convention.>Text following EP vote>1. Member States shall provide mutual assistance for all proceedings relating to fraud, corruption or money laundering and in enforcing the penalties resulting from them.(Amendment 16)Article 6(3), first subparagraph>Original text>3. Member States shall cooperate among themselves and with the Commission in the fight against fraud.>Text following EP vote>3. Member States shall cooperate among themselves and with the Commission in the fight against fraud, corruption and money laundering.(Amendment 17)Article 6(4), first subparagraph>Original text>4. The competent authorities in the Member States may exchange information with the Commission so as to make it easier to establish the facts and to ensure effective prevention of fraud. The Commission and the competent national authorities shall take account for each specific case of the requirements of investigation secrecy.>Text following EP vote>4. The competent authorities in the Member States may exchange information with the Commission so as to make it easier to establish the facts and to ensure effective prevention of fraud, corruption or money laundering. The Commission and the competent national authorities shall take account for each specific case of the requirements of investigation secrecy.(Amendment 18)Article Z(1), first subparagraph>Original text>1. [Requests for judicial assistance with regard to fraud may be transmitted directly between judicial authorities and replied to in the same way.>Text following EP vote>1. Requests for judicial assistance with regard to fraud, corruption and money laundering may be transmitted directly between the competent authorities and replied to in the same way. The judicial assistance requested shall be provided immediately.(Amendment 19)Article Z(2)>Original text>2. [In pursuance of the objective laid down in Article 6(2) of the Convention and for the purposes of ensuring the effectiveness and consistency of investigations, the latter shall be carried out in concert by the competent authorities whenever a fraud offence concerns more than one Member State or fraud offences concerning more than one Member State are linked with one another.]>Text following EP vote>2. For the purposes of ensuring the effectiveness and consistency of investigations, the latter shall be carried out in concert by the competent authorities whenever a fraud, corruption or money laundering offence concerns more than one Member State or fraud, corruption or money laundering offences concerning more than one Member State are linked with one another.>Text following EP vote>The Unit for the Coordination of Fraud Prevention (UCLAF) shall be responsible for coordinating such concerted action in these cases. In the event of a conflict the Commissioner responsible shall act as mediator.Legislative resolution embodying Parliament's opinion on the draft second Protocol drawn up on the basis of Article K.3 of the Treaty on European Union, to supplement the Convention on the Protection of the European Communities' financial interests (7752/96 - C4-0137/96 - 95/0360(CNS))(Consultation procedure)The European Parliament,- having regard to the Council draft (7752/96 - 95/360(CNS)),- having been consulted by the Council pursuant to Article K.6, second paragraph of the Treaty on European Union (C4- 0137/96),- having regard to Rule 58 of its Rules of Procedure,- having regard to the report of the Committee on Civil Liberties and Internal Affairs and the opinion of the Committee on Budgetary Control (A4-0313/96),1. Approves the Council draft, subject to Parliament's amendments;2. Calls on the Council to notify Parliament should it intend to depart from the text approved by Parliament;3. Instructs its President to forward this opinion to the Council and Commission.