Green paper on criminal-law protection of the financial interests of the Community and the establishment of a European Prosecutor
Date: 2001-12-11
Institutions: European Commission
Subjects: European official, area of freedom, security and justice, financial policy, fraud against the EU, right to justice

COMMISSION OF THE EUROPEAN COMMUNITIES

Brussels, 11.12.2001
COM (2001) 715 final

GREEN PAPER

on criminal-law protection of the financial interests of the Community and the
establishment of a European Prosecutor

(presented by the Commission)

CONTENTS

1.

1.1.

1.2.

Introduction.............................................................................................................. 5

The origins of the Commission’s proposal to establish a European Prosecutor.......... 5

Reasons for presenting a Green Paper at this stage.................................................... 6

1.2.1.

Fraud against the Community’s financial interests: a phenomenon that needs to be
repressed .................................................................................................................. 7

1.1.2.

The question of a European Public Prosecutor: an ongoing debate............................ 8

1.3.

Objectives of the Green Paper .................................................................................. 9

1.3.1.

To extend the debate to all interested circles ............................................................. 9

1.3.2.

To explore the proposal’s feasibility ....................................................................... 10

2.

2.1.

The premises of the debate ..................................................................................... 12

Value added by the European Public Prosecutor: the arguments for the Commission’s
2000 proposal......................................................................................................... 12

2.1.1. Overcoming the fragmentation of the European criminal law-enforcement area...... 12

2.1.2. Move beyond the cumbersome and inappropriate traditional methods of judicial

cooperation between Member States....................................................................... 13

2.1.3.

The judicial follow-up to administrative investigations ........................................... 13

2.1.4. Reinforce the organisation and effectiveness of investigation activities within the

Community institutions .......................................................................................... 15

2.2.

2.3.

Respect for fundamental rights ............................................................................... 15

Relationship with Europe’s political priorities in matters of justice and home affairs16

2.3.1. Complementarity with the objectives of the Tampere European Council................. 16

2.3.2.

Specific features of the proposal in terms of the objectives of the Tampere European
Council................................................................................................................... 17

2.4.

Legal basis ............................................................................................................. 18

3.

3.1.

General outline ....................................................................................................... 20

Material jurisdiction confined to the protection of the Community’s financial
interests .................................................................................................................. 20

3.1.1.

Specific responsibility of the Communities............................................................. 21

3.1.2. Maintaining the current scope of protection of the Community’s financial interests 21

3.2.

Towards a common investigation and prosecution area........................................... 23

3.2.1.

The powers of the European Public Prosecutor: centralised direction of investigation
and enforcement ..................................................................................................... 24

2

3.2.2. A harmonious relationship with national systems of criminal law ........................... 25

4.

Legal status and internal organisation ..................................................................... 27

4.1.

Status of the European Public Prosecutor................................................................ 27

4.1.1.

Principle of independence....................................................................................... 27

4.1.2. Conditions for appointment and removal from office.............................................. 27

4.1.3. Hierarchical role of the European Public Prosecutor ............................................... 28

4.2.

Decentralised organisation of the European Prosecution Service............................. 28

4.2.1.

Principle of decentralised Deputy European Public Prosecutors.............................. 29

4.2.2.

Subordination to the chief European Prosecutor...................................................... 30

4.3.

Means of action of the European Prosecution Service............................................. 31

5.

5.1.

Substantive criminal law......................................................................................... 33

Choice of legislative technique: Community unification or harmonisation of national
legislation............................................................................................................... 33

5.2.

Common definitions of offences ............................................................................. 34

5.2.1. Offences for the protection of the Community’s financial interests, on which the

Member States are already in agreement................................................................. 35

5.2.2. Offences above and beyond the protection of the Community’s financial interests.. 37

5.2.3. Offences that might be envisaged for the protection of the Community’s financial

interests .................................................................................................................. 38

5.3.

1.4.

1.5.

6.

6.1.

6.2.

Common penalties.................................................................................................. 39

Liability of legal persons ........................................................................................ 40

Rules of limitation .................................................................................................. 40

Procedure ............................................................................................................... 42

Information and referral.......................................................................................... 42

The preparatory stage ............................................................................................. 43

6.2.1.

Fundamental rights ................................................................................................. 44

6.2.2. Opening of investigations and enforcement proceedings......................................... 45

6.2.3. Conducting investigations....................................................................................... 49

6.2.4. Outcome of prosecution.......................................................................................... 53

6.3.

Trial stage .............................................................................................................. 55

6.3.1. Choice of Member State of trial.............................................................................. 55

6.3.2.

Exercise of the prosecution function ....................................................................... 57

3

6.3.3.

The European Communities, victims in accordance with the ordinary law .............. 57

6.3.4.

Law of evidence ..................................................................................................... 58

6.3.5.

Factors causing early termination of prosecution .................................................... 60

6.3.6.

Execution of the judgment ...................................................................................... 60

6.4.

Guarantee of the involvement of a court ................................................................. 60

6.4.1.

Functions of the court ............................................................................................. 60

6.4.2.

The designation of the judge of freedoms ............................................................... 61

6.4.3. Designation of the court to review the committal.................................................... 62

7.

7.1.

7.2.

Relations with the other parties involved ................................................................ 64

Cooperation with Member States’ authorities ......................................................... 64

Relations with those involved in cooperation in criminal matters in the European
Union ..................................................................................................................... 64

7.2.1.

Eurojust.................................................................................................................. 65

7.2.2.

Europol .................................................................................................................. 66

7.2.3.

European Judicial Network..................................................................................... 66

7.3.

Relations with Community institutions and other bodies......................................... 67

7.3.1. General................................................................................................................... 67

7.3.2.

Future role of OLAF............................................................................................... 67

7.4.

Relations with third countries ................................................................................. 68

8.

Judicial review of acts of the European Public Prosecutor ...................................... 70

8.1.

Reviewable acts of the European Public Prosecutor................................................ 70

8.1.1. Acts of investigation entailing a restriction or deprivation of personal liberty ......... 70

8.1.2. Other acts of investigation ...................................................................................... 70

8.1.3. Case closed or not pursued ..................................................................................... 71

8.1.4. Committal for trial.................................................................................................. 71

8.2.

Right to review ....................................................................................................... 72

8.2.1. Review under domestic law .................................................................................... 72

8.2.2. Review by the Court of Justice ............................................................................... 73

9.

Conclusion ............................................................................................................. 75

4

1.

INTRODUCTION

The need to prosecute perpetrators of fraud affecting the financial interests of the European
Communities more effectively has led the Commission to propose establishing a European
Public Prosecutor with responsibility in this field. Its proposal deserved closer attention and
wide debate, which is why the Commission is presenting this Green Paper today.

Although it is based on a general proposal already adopted by the Commission, this paper is
offered as a basis for consultation like any other Green Paper. At a second stage, the idea is
that a better-informed view can be taken on the principle following closer preliminary thought
about the possibilities for its implementation.

1.1.

The origins of the Commission’s proposal to establish a European Prosecutor

In the context of the Nice Intergovernmental Conference, the Commission proposed, as a
response to fraud against the Community’s finances, to remedy the fragmentation of the
European law-enforcement area by establishing a European Public Prosecutor.1 The protection
of the Community’s financial interests is a specific enough concern to warrant a specific
response transcending the limits of traditional judicial cooperation.

Historically, the idea of specifically furthering criminal-law protection of the Community’s
financial interests arose following the allocation of own resources to the Community, with a
first draft amendment to the Treaty dating from 6 August 1976.2 It evolved further with the
signing of agreements and similar
the Convention of
26 July 1995,3 adopted in the context of justice and home affairs cooperation (the third pillar)
but not yet ratified by all the Member States. It was first formalised in the Amsterdam Treaty,
which provided a legal basis for the Community legislature to establish rules of limited scope
for the criminal protection of the Community’s financial
the
Commission recently adopted a proposal for a Directive.4 This specificity of the criminal-law
protection of the Community’s financial interests lies at the basis of the proposal to establish a
European Public Prosecutor.

instruments, and in particular

interests. On this basis,

This proposal was preceded by detailed preparatory work. For almost ten years now, at the
request of the European Parliament and the Commission, groups of experts in criminal law
from all the Member States have been working on the subject of the criminal-law protection

1

2

3

4

the Community’s financial

Additional Commission contribution to the Intergovernmental Conference on institutional reforms - The
criminal protection of
interests: A European Prosecutor, 29.9.2000,
COM(2000) 608. See Annex 1. This contribution amplifies the Commission’s Opinion given under
Article 48 of the Union Treaty on the convening of a Conference of Representatives of the Governments
of the Member States to amend the Treaties, Adapting the institutions to make a success of enlargement,
26.1.2000, COM (2000) 34, point (5)(b).
Former draft Treaty amending the Treaties establishing the European Communities so as to permit the
adoption of common rules on the protection under criminal
interests of the
Communities and the prosecution of infringements of the provisions of those treaties, COM(76)418, OJ C
222, 22.9.1976.
Convention of 26 July 1995 on the protection of the European Communities’ financial interests (OJ C
316, 27.11.1995, p. 49) and its additional protocols (OJ C 313, 23.10.1996, p. 1; OJ C 221, 19.7.1997, p.
11; OJ C 151, 20.5.1997, p. 1).
Proposal for a Directive of the European Parliament and of the Council on the criminal-law protection of
the Community’s financial interests, presented by the Commission on 23.5.2001 (COM(2001) 272).

law of the financial

5

of the Community’s financial interests.5 The result of their work, welcomed by the European
Parliament6and the Commission, was a proposal for a set of rules for the criminal-law
protection of the Community’s financial interests, the well-known “Corpus Juris”. They were
based on a vast comparative study of national systems of criminal law which concluded that
the project was feasible.7

But the debate cannot stop there. In 2000 the Commission presented its contribution. It is
conducting its reflections, not proceeding from any particular national model but seeking the
the objective of protecting the
system best matching the specific requirements of
Community’s financial interests and aiming at the highest levels of protection of fundamental
rights.

1.2.

Reasons for presenting a Green Paper at this stage

The Commission’s contribution to the Intergovernmental Conference for revision of the EC
Treaty to provide a legal basis for the establishment of the European Public Prosecutor8 was
not taken up by the European Council at Nice in December 2000. In the first place the
Intergovernmental Conference was not given the necessary time to examine the proposal. The
need for more detailed study of the practical implications was also expressed.

But
the underlying philosophy remains unchanged. And there were some encouraging
reactions. In accordance with its action plan for 2001-03 on protecting the Communities’
financial interests,9 the Commission therefore undertook to adopt this Green Paper in order to
clarify its ideas and to widen the debate.

The point is to respond to the scepticism which has all too often greeted its proposal by
explaining it in practical terms and considering the possibilities for the implementation of a
solution which might rightly be seen as ambitious and innovatory.

5

6

7

8

9

Comparative analysis of the reports by the Member States on the measures taken at national level to
combat waste and the diversion of Community resources: Summary paper, European Commission,
13.11.1995, COM(95)556 ; see also several studies commissioned by the Commission: Comparative
study on the protection of the Community’s financial interests, 3 volumes, 1992-1994; Study on systems
of administrative and criminal penalties in the Member States of the European Communities, 2 volumes,
1994; Out-of-court settlements in the European Union, 1995.
Resolution on the creation of a European legal and judicial area to protect the European Union’s financial
interests against international crime, European Parliament, 12.6.1997 (OJ C 200, 30.6.1997, p. 157).
Corpus Juris introducing penal provisions for the purpose of the financial interests of the European
Union, under the responsibility of M. Delmas-Marty, Economica, Paris, 1997. In response to these
Juris
recommendations,
(http://www.law.uu.nl/wiarda/corpus/index1.htm) and completed a comparative study on the need for it
and its legitimacy and feasibility, analysing the potential impact of a European Prosecutor on national
prosecution systems: The Implementation of the Corpus Juris in the Member States, M. Delmas-Marty /
J.A.E. Vervaele, Intersentia, Utrecht, 2000 (4 volumes). For the purposes of this Green Paper, all
references are to this second version, known as the “Florence version”, of the Corpus juris, unless
otherwise specified.
COM(2000) 608, already referred to.
COM (2000) 254

recently

Corpus

experts

revised

more

the

the

6

1.2.1. Fraud against the Community’s financial interests: a phenomenon that needs to be
repressed

Fraud is a phenomenon that needs to be stamped out. In the current general context of a
stronger international fight against financial crime, the scale of illegal activity to the detriment
of Community funds is worth remembering.

The proportion of all the cases of irregularity detected by the Commission and the Member
States which entail criminal proceedings - i.e. where there is intent - was estimated by the
Commission and the Member States in 1999 at around 20% of known cases and nearly 50%
of the corresponding amounts. The scale of fraud affecting the Community’s financial
interests detected by the Member States and by the European Anti-Fraud Office (OLAF) in
1999 was estimated to account for a total of

413 million.10

€

Frauds in 1999

Reports from Member States

OLAF investigations

Number of
cases

1.235

252

Amount (

€

Mio)

190

223

Overall, these cases represented fraud with an impact on European own resources of some
€
291 million (or
122 million (or 0.9 % of traditional own resources) and on expenditure of
73
48 million in the field of

0.3 % of the budget),
million concerned external action by the Communities and
structural actions.

170 million of which was in the area of agricultural expenditure,

€

€

€

€

Every year since 1991 the Commission has given a description of the fraud phenomenon
with statistics and examples in its annual report on the protection of the Community’s
financial interests and the fight against fraud.11

The administrative detection facilities in the Community have been refined over the years.12
There has also been an enhanced effort to prevent fraud in the context of the reform of the
administration of the Commission, of which OLAF’s anti-fraud strategy is a component.

But prevention and detection are not enough by themselves. The need for effective
is known that organised crime has been involved in
enforcement activities remains. It
numerous cases that have come to the knowledge of the Commission departments over the
years, and especially of the Unit for the Coordination of Fraud Prevention (UCLAF) set up in
1988 and replaced in 1999 by the European Anti-Fraud Office (OLAF), with independent
investigative powers. Fraud affecting the Community’s financial interests primarily concerns
major cases involving the criminal courts of several Member States. They are complex and
distinctly transnational in nature.

10

11

12

European Commission, Protection of the Communities’ financial interests and the fight against fraud,
annual report 1999, COM(2000) 718, points 4 and 5.
European Commission, Annual report 2000: protection of the Communities’ financial interests and the
fight against fraud, COM (2001) 255.
The Cologne European Council in June 1999 welcomed the rapid creation of OLAF and the legal
framework accompanying it, called for by the Vienna European Council in December 1998.

7

A problem on this scale must be met with an appropriate response. This is a specific form of
crime which calls for a specific response. Given its nature, the response must include a
repressive dimension,
in accordance with the requirements introduced by the Treaty of
Amsterdam. Article 280 of the EC Treaty now requires protection of the Community’s
financial interests to be effective, dissuasive and equivalent in all the Member States. In these
circumstances, the Community must guarantee to Member States and Europe’s taxpayers that
offences of fraud and corruption are genuinely prosecuted in the courts. Otherwise the
credibility of European integration to public opinion could be seriously compromised.

1.2.2. The question of a European Public Prosecutor: an ongoing debate

The debate on the establishment of a European Prosecutor did not wait for the Green Paper
before taking off.

At European level, the limitations on national law-enforcement areas faced with transnational
economic and financial crime have been denounced for years now by practitioners, judges,
police forces and lawyers. From the Geneva appeal on 1 October 1996 to the recent Trier
declaration on 15 September 2001 in favour of relaunching the question of the European
Public Prosecutor in the run-up to enlargement of the Union, via the Strasbourg Manifesto of
20 October 2000, professional circles have taken the subject up in several Member States. In a
more latent way, the question is now near the top of the list of popular concerns, no longer
being confined to specialist or academic circles.13

The European Parliament has played a leading role here, repeatedly calling since the 1990s
for this proposal to be implemented, in order to ensure effective follow-up at the criminal
prosecution stage to the prevention and administrative detection of fraud.14

More recently, the Committee of Independent Experts,15 the Committee of Wise Men16 and
the OLAF Supervisory Committee,17 each in its own area of concern, recommended in 1999
that a European Public Prosecutor be established with powers to act here.

At national level, the political debate hotted up, in some Member States at least. Without
claiming to be exhaustive, let us report on a few expressions of opinion here.

In the United Kingdom, the House of Lords published its enquiry into prosecuting fraud on
finances, conducted by its Select Committee on the European
the Communities’

13

14

15

16

17

An annual opinion poll conducted by the Institut Louis-Harris in eight Member States in December 2000
for Le Monde revealed that 68% of respondents supported harmonisation of court systems in the Member
States.
See in particular Resolution on the Commission’s annual report for 1996 (JO C 339; 10.11.1997 p. 68);
Resolution on criminal procedures in the European Union (Corpus Juris), 13.4.1999; Resolution of 19
January 2000 on the establishment of criminal protection for the financial interests of the Union (OJ C
304, 24.10.2000, p. 126); Resolution of 13.4.2000 for the Intergovernmental Conference; Resolution of
16.5.2000 of the Commission’s annual report for 1998 on the protection of the Community’s financial
interests; Resolution of 13.12.2000 on the Commission’s antifraud strategy (OJ C 232, 17.8.2001, p.191);
Resolution of 14 March 2001 of the Commission’s annual report for 1999 on the protection of the
Community’s financial interests.
Second report on the reform of the Commission, 10.9.1999, recommendation 59.
Report by Mr Dehaene, Mr Simon and Mr Von Weizsäcker, 18.10.1999, point 2.2.6.
OLAF Supervisory Committee, Opinions 5/99 and 2/2000, in Report July 1999 - July 2000 (OJ C 360,
14.12.2000).

8

Communities.18 The Chairman of this Committee, while not endorsing the conclusions of the
Corpus Juris, recognises that the introduction of a special regime for prosecuting fraud should
be considered if the efforts still to be made on intergovernmental judicial cooperation were to
be delayed or to fail.

In France, the National Assembly delegation on the European Union, considering the fight
against fraud in Europe, portrays the question of a European Public Prosecutor as one aspect
of the choice in the field today.19 Its rapporteur concludes that the effectiveness of prosecution
in this area is a real problem and that a European Public Prosecutor is essential.

In Germany, the Federal Government replied to a question from a group of members of the
Bundestag regarding possible criminal-law developments at Community level, in particular
with a view to protecting the financial interests of the Communities.20 The reply was that,
despite serious reservations on the general part of the Corpus juris study, the establishment of
a European Public Prosecutor should be planned in the context of a possible sectoral
unification of substantive and procedural criminal law and proceed from experience with the
establishment of Eurojust, regarded by the German Government as the embryo of a future
European Public Prosecutor.

The Dutch Minister of Justice has described the Commission contribution to the
Intergovernmental Conference as interesting. He considers that they can usefully contribute to
a discussion on the substance of measures to improve the fight against fraud in the
Community and is ready to cooperate.21

In the broader context of the fight against crime in the European Union, certain Heads of
Government now refer to various versions of the concept of a European prosecution service
when speaking of their vision of Europe’s future.22

These opinions are, if nothing else, evidence both of the interest in the subject and of the need
for a more in-depth debate of how a European Public Prosecutor should operate. The
Commission is proposing an innovatory solution that is both narrower and more specific, in
order to meet a specifically common need. Hence the reason for this Green Paper.

1.3.

Objectives of the Green Paper

The nature of the Green Paper distinguishes it from earlier preparatory work. It seeks to both
broaden and deepen the debate on the Commission proposal with a view to its being
considered by the Convention which is to prepare for the next Treaty revision.

1.3.1. To extend the debate to all interested circles

With this end in mind, the first objective of the Green Paper is to initiate as wide a
consultation process as possible throughout 2002 with all interested circles – Community and

18

19

20

21

22

Prosecuting fraud on the Communities’ finances - The Corpus Juris, 8.5.1999, Select committee on the
European Communities, House of Lords, London.
Rapport d’information sur la lutte contre la fraude dans l’Union européenne, Délégation de l’Assemblée
nationale pour l’Union européenne, 22.6.2000, No 2507.
Bundestagsdrucksache 14/4991, 14.12.2000, p. 32 et seq.
Letter to the Legal Affairs Committee of the Dutch Parliament concerning judicial cooperation in
criminal matters, 5.7.2001.
SPD motion on Europe, presented by Chancellor Schröder on 30.4.2001 and adopted in November 2001;
speech on the future of the European Union by Prime Minister Jospin, 23.5.2001.

9

public

authorities,

crime-related

national
relevant
non-governmental organisations. The consultations will relate to the possible duties and
operation methods of a European financial Prosecution Service. The Green Paper will enable
the debate to be structured along a number of themes and will give it a wide audience, in the
spirit of good governance.

professions,

academic

circles,

The themes are the following:

– The premises of the debate (Chapter 2)

– General outline (Chapter 3)

– Legal status and internal organisation (Chapter 4)

– Substantive law (Chapter 5)

– Procedural law (Chapter 6)

– Relations with other parties involved (Chapter 7)

– Judicial review (Chapter 8)

On each of these themes, the Commission begins by setting out the facts that can underlie the
debate. It then sets out a number of options and sometimes expresses a preference reflecting
the current state of its thinking. Lastly, it raises questions on which it would be glad to have
the views of interested circles. While the Commission’s preferences, taken as a set, would
produce a coherent system, there is no reason to believe this is the only possible system, and
the debate is not closed in advance.

1.3.2. To explore the proposal’s feasibility

The Green Paper also gives the Commission an opportunity to spell out its ideas looking
beyond the preparatory studies that have been conducted for several years now. In its
Communication of 29 September 2000, the Commission proposed including in the Treaty
only the essential characteristics of the European Prosecutor (appointment, removal, duties
and independence), leaving the rules and mechanisms governing the Prosecution Service’s
operation to be regulated by secondary legislation.

What this Green Paper is specifically about is to outline a possible scenario for the secondary
legislation. This legislation should, in particular, establish Community-level definitions of
offences (fraud, corruption, money-laundering, etc.) and penalties relating to activities that
harm the Community’s financial interests. It should determine how the Community legislation
will mesh with the national systems of criminal law. It should deal with the procedures for
laying cases before the European Public Prosecutor, his powers of investigation and the
opening and outcome of detection activities. It should also provide for judicial review of acts
done by the European Public Prosecutor.

While the debate in 2000 focused on the legitimacy of and reasons for creating such an office,
the Green Paper extends it to the feasibility and the possible mechanisms for ensuring the
operation of the European Prosecutor. Beyond the principle, already set out by the
Commission in its Communication, the purpose here, out of a concern for the transparency of
legislative preparatory work, is to consider the practical conditions for actually implementing
the measures it proposes.

10

The Commission therefore invites your comments on this Green Paper and in particular on the
questions set out in boxed items and listed in an annex.

To facilitate exchanges of views, a website is opened, hosting this Green Paper and a series of
relevant links.

http://europa.eu.int/olaf/livre_vert

Until 1 June 2002, answers may be given, preferably to the following address:

olaf-livre-vert@cec.eu.int

or by post to:

European Commission

European Anti-Fraud Office (Unit A.2)

Answer to Green Paper on the European Public Prosecutor

Rue Joseph II, 30

B-1049 Brussels

Comments received will be published on the website unless their author specifically asks for
them to be treated as confidential.

There will be a public hearing for those interested in 2002. The Commission will present
conclusions, and possibly a fresh contribution, in 2003, on the basis of the answers it receives,
in connection with its preparations for revision of the Treaties.

11

2.

THE PREMISES OF THE DEBATE

In its contribution to the Nice Intergovernmental Conference, the Commission for the first
time set out the reasons why the European Public Prosecutor would be an effective form of
criminal protection for the Community’s financial interests. The proposal is linked to a series
of conditions which are worth recalling as a preliminary to the debate. Provided the Treaties
are revised (point 2.4), it offers value added in relation to the current situation (2.1) with full
respect for fundamental rights (2.2) and specifically complements Europe’s political priorities
in matters of justice (2.3).

2.1.

Value added by the European Public Prosecutor: the arguments for the
Commission’s 2000 proposal

The exercise of the detection and prosecution functions at Community level would add value
in relation to the current situation. However legitimate and irreplaceable they may be, existing
systems,
in the absence of a specific Community institutional structure, do not allow
sufficiently effective enforcement. The Commission communication of 29 September 2000
develops and illustrates a number of arguments, which are merely outlined here.23

2.1.1. Overcoming the fragmentation of the European criminal law-enforcement area

The involvement of organised crime in fraud against the Community’s financial interests and
the transnational nature of such fraud imply cooperation with seventeen legal orders applying
different rules of substance and procedure.24 With the enlargement of the Union, these
difficulties will increase as the number of Member States and the number of operators and
administrations involved in the management of Community funds rise.

The shortcomings of the current arrangements lie above all in the fragmentation of the
European criminal law-enforcement area. True, exceptions from the principle of national
territoriality now appear in international conventions to which the Member States are
parties.25 But
the police forces and courts of the Member States still basically have
jurisdiction solely in their own territory. This fragmentation between authorities has lead to
competing or incomplete investigations, and in some cases to none at all.

This is borne out by the example of completed or abandoned prosecutions cited by the Commission at
paragraph 1.1 of its Communication to the Nice Intergovernmental Conference (see Annex 1).

In more specific terms, before the adoption of the Amsterdam Treaty, the signing of the
Convention of 26 July 1995 and its additional protocol constituted a first major step towards
the criminal protection of the Community’s financial interests. But not all these instruments
have yet come into force, as they have not been ratified by all the Member States.26 This was
one of the reasons why on 23 May 2001 the Commission presented the proposal for a

23

24

25

26

See Annex 1.
Some Member States have several national legal orders, as is the case of the United Kingdom (England &
Wales, Scotland, and Northern Ireland).
Example: Schengen Implementing Convention of 19 June 1990 (Articles 39 et seq: observation and hot
pursuit); Convention of 18 December 1997 on mutual assistance and customs cooperation between
judicial assistance in
customs administrations (Naples II); Convention of 29 May 2000 on mutual
criminal matters (controlled deliveries, joint investigation teams, covert investigations).
At the end of September 2001 three Member States had still not notified their ratification of the
Convention on the protection of financial interests, and eight still had to ratify the Protocol of 19.6.1997.

12

directive to enact the provisions contained in third-pillar instruments on the basis of Article
280 of the EC Treaty.27

But these provisions will not suffice on their own to overcome the fragmentation of the
European criminal law-enforcement area since the prosecution function will still be exercised
at national level.

Thus, while retaining seventeen separate systems of criminal courts, this Green Paper sets out
to show that as a result of the European Public Prosecutor and the centralised management of
detection and prosecution activities the Community would enjoy effective and equivalent
protection of its financial interests throughout the Union, as demanded by the Treaty.

2.1.2. Move beyond the cumbersome and inappropriate traditional methods of
cooperation between Member States

judicial

Some forms of international cooperation in criminal matters already exist; it can be expected
that the strengthening of judicial cooperation as part of the third pillar will facilitate this
process. But none of the instruments currently in force or at proposal or negotiation stage
gives an adequate response to the specific question of criminal proceedings for acts to the
detriment of the Community’s financial interests.

Organised crime harmful to these interests has developed in such a way that the conventional
tools of mutual judicial assistance are no longer suited to the task, and the progress so far
made in judicial cooperation is limited. These inadequacies are the cause of delays, dilatory
actions and even impunity. This is particularly harmful for attempts to reconstitute financial
circuits upstream of fraud.

This is illustrated by the example of successive prosecutions cited by the Commission at paragraph
1.2 of its Communication to the Nice Intergovernmental Conference (see Annex 1).

As will be seen below, the European Public Prosecutor would help to overcome these
difficulties. He would provide an interface between the Community and the national judicial
authorities. In transnational fraud cases, this would make it easier to avoid the destruction of
evidence and the disappearance of suspects, both of which are currently assisted by the
absence of judicial cooperation between the Community and the Member States.

2.1.3. The judicial follow-up to administrative investigations

Accumulated operational experience shows how difficult it is for administrative investigations
on the ground to culminate in proceedings in court. In the current state of Community law,28
however effective the detection and coordination work done by the European Anti-Fraud
Office, which now has a Judicial Advice Unit, criminal prosecution remains uncertain. The

27

28

COM(2001) 272, referred to above.
Parliament and Council Regulation (EC) No 1073/99 and Council Regulation (Euratom) No 1074/99 of
25.5.1999 concerning investigations conducted by the European Anti-Fraud Office (OLAF) (OJ L 136,
31.5.1999); Commission Decision of 28.4.1999 establishing the European Anti-fraud Office (OLAF) (OJ
L 136, 31.5.1999); Interinstitutional Agreement of 25.5.1999 concerning internal investigations by the
European Anti-fraud Office (OLAF) (OJ L 136, 31.5.1999); Regulation (Euratom, EC) No 2185/96 of the
Council concerning on-the-spot checks and inspections carried out by the Commission in order to protect
the European Communities’ financial
interests against fraud and other irregularities, OJ L 292,
15.11.1996. Council Regulation (EC, Euratom) No 2988/95 of 18.12.1995 on the protection of the
European Communities financial interests: OJ L 312, 23.12.1995, p.1.

13

Community does not have a criminal prosecution function to supplement preventive action
and administrative investigation.

The transmission of information between Member States and between them and OLAF comes
up against a series of barriers in the form of differing rules governing criminal prosecutions in
the Member States. If, for the same offence, the inquiry is handled in some Member States by
a judge but
in others by an administrative authority, direct contact between the two is
generally impossible in both fact and law. Moreover, not all the relevant national authorities
in particular those
even have access to information under the various national rules,
concerning the secrecy of tax and business information29 or the confidentiality of criminal
investigations. The integration of the investigation and prosecution functions that
the
establishment of the European Public Prosecutor would achieve would iron out
these
difficulties.

And the diversity of national rules on evidence often means that evidence gathered in one
Member State cannot be used in courts in another.

This is borne out by the example of inadmissible evidence, cited by the Commission at paragraph 1.3
of its Communication to the Nice Intergovernmental Conference (see Annex 1).

All trial courts apply the rules in force in their own country (principle that forum regit actum),
particularly as regards evidence. They do not necessarily recognise the rules of the place
where acts of investigation took place if those rules are different, with the effect that evidence
gathered in that context may be inadmissible. This situation can ruin investigation efforts in
transnational fraud cases.

A typical fraud case in the absence of recognition of evidence rules

In a recent case, an importer of olive oil was suspected of presenting false customs
declarations to avoid paying agricultural duties (Community resources evaded). He had
used a series of companies in several Member States for transport, distribution, sales and
financing. The evidence was scattered over Community territory. The completeness of the
prosecution file depended on being able to use the results of administrative investigations
carried out by OLAF among other bodies, and judicial investigations, including the results
of international letters rogatory.

When the case came to trial, the criminal in the Member State where the case was being
heard held that the bulk of the evidence was inadmissible as it had been obtained by an
administrative authority (OLAF) or by law-enforcement officers (crime investigation
police) and not by a prosecution service or examining judges. Statements by private
individuals (lorry drivers), duly recorded by law-enforcement officers, were also excluded.

This is just one case among many others. In certain Member States the rules of evidence are
even stricter as regards documentary evidence and require direct oral testimony in the
courts.

This Green Paper shows that the establishment of a common investigation and prosecution
area guided by the principle of mutual admissibility of evidence would help to overcome this
barrier. Evidence gathered as a result of acts of investigation by administrative and judicial
authorities under the direction of the European Public Prosecutor, if necessary with a warrant

29

Final report on the first evaluation exercise devoted to judicial assistance in criminal matters, approved by
the Council on 28.5.2001 (JO C 216, 1.8.2001), heading III(e) (Tax offences): “The evaluations showed
that the issue of tax offences remained such a sensitive one that mutual assistance could, on this basis be
limited and slowed down or at worst be refused.”

14

from the judge of freedoms, would be recognised as admissible evidence in criminal courts
throughout the Community.30

2.1.4. Reinforce the organisation and effectiveness of investigation activities within the
Community institutions

For the moment there is no European judicial body with jurisdiction to conduct investigations
within the Community institutions. The European Anti-fraud Office (OLAF) is still an
administrative investigation service, despite the assistance it can already offer the judicial
authorities. Proceedings in cases internal to Community bodies still depends on the goodwill
of the national enforcement authorities in the headquarters State.

An example: fraud within the Community institutions

An internal investigation by OLAF with judicial follow-up in several Member States
concerned a situation where officials were suspected of being involved in the award of
Community grants to firms in which they had interests. These firms were in several
Member States and even in financial centres outside the Communities.

Several obstacles have been encountered in this type of case. OLAF’s administrative
prerogatives are too limited to allow it to handle all the facts of the case, which may require
it to question witnesses, order house searches and examine bank records, and even issue
international letters rogatory.

The question of determining the national enforcement authorities before whom the same
facts must be laid where several may have jurisdiction is currently a source of difficulty.
The disparity between the relevant national laws is a great source of complexity where
testimony gathered by OLAF is to be used in the courts as, for example, the procedural
requirements of one Member State for the protection of individual rights may be regarded
as inadequate in criminal proceedings in another Member State. The diversity of limitation
rules can also have the effect that cases are referred out of time. And a judicial authority
might decide to close a case with no further action on the grounds that the disciplinary
penalties and the fact that the official has left his post remove the need for proceedings.

investigations in the institutions would
The organisation and effectiveness of internal
inevitably be boosted by the establishment of a European Public Prosecutor.31 The
Commission’s proposal accordingly acts more specifically on the European Parliament’s
repeated request for an initiative for the establishment of a European Public Prosecutor with
jurisdiction within the European Union institutions.32

2.2.

Respect for fundamental rights

The European Public Prosecutor would be required, in the exercise of his functions, to respect
the fundamental rights guaranteed by Article 6 of the Union Treaty,
the fundamental
principles of Community law upheld by the Court of Justice of the European Communities

30

31

32

Cf. point 6.3.4 (evidence).
See Opinion No 3/2001 of the OLAF Supervisory Committee of 6.9.2001 on the possible establishment
of a European Public Prosecutor responsible for internal investigations.
Resolution of the European Parliament of 16.5.2000 on the Commission’s annual report for 1998 on the
interests and the fight against fraud, point 2;
protection of the European Communities’ financial
Resolution of 13.12.2000 on the Commission’s antifraud strategy, point 12 (OJ C 232, 17.8.2001, p. 192);
recital 14 of the proposal for a Directive on the criminal-law protection of the Community’s financial
interests, as amended by the European Parliament on 29.11.2001 (PE 305.612)..

15

(the “Court of Justice”), the Charter of Fundamental Rights of the European Union33 and the
European Convention for the Protection of Human Rights and Fundamental Freedoms.

In particular, as will be seen below, all acts involving an element of compulsion carried out by
the European Public Prosecutor should be subject to review by a court designated by the
Member State as the “judge of freedoms”.34

The establishment of a European Public Prosecutor would, of course, have the effect that
offenders who currently go unpunished would be brought to justice: that is the purpose of the
exercise. But the proposed system would also help to improve the position of accused
persons.35 By definition, it would reduce the accumulation of national proceedings. It would
allow the preparatory stages of the procedure to be speeded up, thus speeding up proceedings
generally. It should also have the effect that the national authorities would have less need to
remand suspects in pre-trial custody or order other measures in restraint of freedom designed
to ensure that the accused person does not leave the national territory, for there would be a
substantial boost to the effectiveness of Community-wide proceedings.

2.3.

Relationship with Europe’s political priorities in matters of justice and home
affairs

One of the objectives of the European Union defined by the Amsterdam Treaty is its
development “as an area of freedom, security and justice, in which the free movement of
persons is assured in conjunction with appropriate measures with respect to ... the prevention
and combating of crime”.36

The Tampere European Council on 15 and 16 October 1999 attached high political priority to
establishing this area.

The Commission contribution to the Intergovernmental Conference in 2000 was conceived as
a contribution to the same general objective. It does not in any way contradict the spirit of
Tampere. It complements the efforts made to boost
judicial cooperation, of which the
establishment of Eurojust is the latest manifestation,37 by furthering integration in a specific
area of shared powers between the Community and the Member States (Article 280 EC).

2.3.1. Complementarity with the objectives of the Tampere European Council

On many points, the proposal to establish a European Public Prosecutor is supported by the
Tampere guidelines.

The diagnostic underlying the Commission’s proposal is basically the same. The European
Council recognised that “Criminals must find no ways of exploiting differences in the judicial
systems of Member States”.38

33

34

35

36

37

38

OJ C 364, 18.12.2000.
See below at point 6.4 (freedom secured by the courts).
In the Green Paper the concept of accused person is used in a generic sense and may correspond to
various forms of status depending on the legal terminology in the different Member States. Accused
person here means a person who is suspected of an offence and who has been notified by the European
Public Prosecutor of the charges against him.
Article 2 of the Union Treaty.
Cf. point 7.2.1 (Eurojust)
Presidency Conclusions, Tampere European Council, 15 and 16 October 1999, point 5.

16

Certain general objectives are also in common, since the overriding aim is to contribute to the
“area of freedom, security and justice” called for by the Amsterdam Treaty. The proposal to
establish a common investigation and prosecution area would make a significant contribution
in the specific matters of protection of the Community’s financial interests. At the same time
the guarantee of fundamental rights, the importance of which has already been referred to, is
to balance out
the stronger effectiveness of enforcement measures flowing from the
establishment of the European Public Prosecutor, in accordance with the Tampere conclusion
that “A balanced development of unionwide measures against crime should be achieved while
protecting the freedom and legal rights of individuals and economic operators”.39

One of the main vectors of the establishment of an enforcement system for the criminal
protection of the Community’s financial interests while fully maintaining the jurisdiction to
try and judge cases at national level is the principle of mutual recognition of court decisions
between Member States. This principle presupposes mutual trust in the Member State’ legal
systems and a shared fundamental basis. It implies that there would be no further need for
additional decisions to validate or register judgments for enforcement. The European Council
has made the principle of mutual recognition the “cornerstone of judicial co-operation in both
civil and criminal matters within the Union”, specifying that it will “also apply to pre-trial
orders, in particular to those which would enable competent authorities quickly to secure
evidence and to seize assets which are easily movable”.40

One of the instruments available to enhance the action taken by the European Public
Prosecutor will be the European arrest warrant. Identified as a priority task at Tampere, there
is now a Commission proposal for a Framework Decision in a broader context,41 and keen
interest has been shown by all the Community institutions, which have declared that “The
European Union will accelerate the implementation of a genuine European judicial area,
which will entail, among other things, the creation of a European warrant for arrest and
extradition, in accordance with the Tampere conclusions, and the mutual recognition of legal
decisions and verdicts”.42 The proposal to establish a European Public Prosecutor is part of
this dynamic.

2.3.2. Specific features of the proposal in terms of the objectives of the Tampere European
Council

But in other respects, the proposal amplifies the Tampere guidelines. It is on a limited scale
and in no way competes with the more general initiatives that are being made in the context of
the third pillar. On the contrary, it extends them by other means into the Community context
of the first pillar, adapting them to the specific features of the criminal-law protection of the
Community’s financial interests.

While Eurojust, according to the Tampere conclusions, is to exercise powers conferred on it
in a wide-ranging judicial cooperation context, the European Public Prosecutor would be a
Community authority with his own enforcement powers in the specific area of protection of
the Community’s financial interests.

39

40

41

42

Conclusions, point 40.
Conclusions, points 33 and 36.
Commission proposal for a Framework Decision on the European arrest warrant and the procedures for
surrender between Member States of the European Union, COM(2001)522.
Joint Declaration by the Heads of State or Government of the European Union, the President of the
European Parliament, the President of the European Commission and the High Representative for the
common foreign and security policy, 14.9.2001.

17

Regarding justice more generally, the European Council asked the Council and Commission
to launch “work ... on those aspects of procedural law on which common minimum standards
are considered necessary”.43 As for the means, the Commission goes further, as regards the
preparatory stage of trials relating specifically to offences against the Community’s financial
interests, proposing a degree of procedural harmonisation. Acts done by the European Public
Prosecutor, subject to review by the national judge of freedoms designated for the purpose,
would then be valid in all Member States as acts done by a common body.

the establishment of a common investigation and enforcement area for the
Basically,
protection of the Community’s financial interests is not an initial experimental measure
prefiguring a future component of the area of freedom, security and justice. Rather, it is the
logical culmination of the process of Community integration. The effect of the internal market
and the Community policies that accompany it is that the Communities now enjoy extensive
financial resources of their own, and protecting them against crime now requires there to be a
Community enforcement function. Where there are basically common interests, there must
also be common protection.

then,

In a nutshell,
the European Public Prosecutor for the criminal protection of the
Community’s financial interests would be part of the “Europe of justice” but less concerned
with justice “in Europe” than with justice “for Europe”.

2.4.

Legal basis

The proposal considered here requires that there should be a legal basis for it. Article 280 of
the EC Treaty provides that measures adopted by the Community legislature to combat illegal
activities to the detriment of the Community’s financial interests “shall not concern the
application of national criminal law or the national administration of justice”. The EC Treaty
and a fortiori the Euratom Treaty, unchanged on this point since Maastricht, do not currently
provide a legal basis for a European law-enforcement area involving a common judicial
authority such as a Prosecutor.

The Community Treaties would accordingly have to be amended. This is the only way of
giving the proposal its proper legitimacy. The Commission has proposed inserting a new
Article 280a in the EC Treaty. The proposal is that the requisite amendment of the Treaty be
confined to what is necessary to lay down the conditions for the European Public Prosecutor’s
appointment and resignation and to determine his tasks and the main features of his function.
If the EC Treaty was so amended, similar provisions to those of the proposed Article 280a of
the EC Treaty would also have to be written into Article 183a of the Euratom Treaty.

The Convention to prepare the next Treaty revision would do well to consider this question.

The amended Treaties would then leave it for secondary legislation to regulate the status and
operation of the European Public Prosecutor. The proposed Article 280a accordingly provides
for the European Parliament and the Council of the European Union acting by a qualified
majority, to adopt the following provisions by the codecision procedure.

« 2. … The Council, acting in accordance with the procedure of Article 251, shall determine
the general rules applicable to the European Public Prosecutor.

43

Tampere Conclusions, point 37.

18

3. The Council, acting in accordance with the procedure laid down by Article 251, shall lay
down the general conditions governing the performance of the functions of the European
Public Prosecutor and shall adopt, in particular:

(a) rules defining the facts constituting criminal offences relating to fraud and any other
illegal activity prejudicial to the Community’s financial interests and the penalties incurred
for each of them;

(b) rules of procedure applicable to the activities of the European Public Prosecutor and
rules governing the admissibility of evidence;

(c) rules applicable to the judicial review of procedural measures taken by the European
Public Prosecutor in the exercise of his functions.

These rules of secondary legislation are precisely what this Green Paper is about and should
at the same time determine the relationship between the Community rules and the national
systems of criminal law. In this context the Green Paper should facilitate discussion of two
crucial questions: how the European Public Prosecutor can be established without also
establishing a special Community court with jurisdiction top review acts done by him and
how far it is necessary to harmonise the law for him to be able to operate effectively.

19

3.

GENERAL OUTLINE

Under Article 280a of the EC Treaty as proposed by the Commission, the European Public
Prosecutor would be “responsible for detecting, prosecuting and bringing to judgment the
interests and their
perpetrators of offences prejudicial
accomplices and for exercising the functions of prosecutor in the national courts of the
Member States in relation to such offences in accordance with the rules provided for by” the
relevant Community legislation.

to the Community’s financial

To gain a sound understanding of the position, it is necessary to begin by considering the
general approach of the proposal. The Commission is adopting the following guidelines here.
The European Prosecutor must have only the jurisdiction expressly conferred on him,
confined to what has already been described here. In accordance with the principles of
subsidiarity and proportionality,
this jurisdiction would remain limited to the minimum
necessary in order to ensure effective and equivalent prosecution of unlawful conduct harmful
to the Community’s financial interests anywhere in the Community (Article 280 of the EC
Treaty).

In this Green Paper the Commission is only proposing that Community law should determine
the minimum needed for the European Public Prosecutor to operate effectively. The principle
is therefore that national law applies except in duly substantiated cases where, on the ground
that the European Public Prosecutor cannot operate effectively, Community law will apply.

In this spirit, the possible material scope of the jurisdiction of the European Public Prosecutor
(point 3.1), acting in a common investigation and prosecution area (point 3.2), is outlined
here. In particular his main powers (point 3.2.1.) and his status in relation to the national legal
systems (point 3.2.2.) are set out.

3.1.

Material jurisdiction confined to the protection of the Community’s financial
interests

The Commission proposes that the European Prosecutor’s jurisdiction be limited to the
protection of the Community’s financial interests as now limited by the provisions of Article
280 of the EC Treaty.

There are, of course, other basically common interests, such as the single currency, the
European public service, the Community trademark etc. But following the same line as in its
September 2000 contribution, the Commission is proposing no extension of the European
Public Prosecutor’s jurisdiction to offences beyond the scope of the protection of the
Community’s financial
interests (other offences committed by Community staff in the
exercise of their functions44 or euro counterfeiting, a wholly new but no less important class
of offence).45 This Green Paper merely mentions these topics as hypothetical examples, to
ensure that the debate is properly informed.

44

45

Cf. point 5.2.3 (offences above and beyond the protection of the Community’s financial interests).
Articles 3 and 4 of the Council Decision of 29.5.2000 to increase protection by providing for criminal
penalties and other sanctions against counterfeiting in connection with the introduction of the euro, OJ L
140, 2.6.2000.

20

3.1.1. Specific responsibility of the Communities

The European Communities have a heightened responsibility for the protection of their
financial
interests. The Treaty of Amsterdam introduced an express reference to this
responsibility, alongside that of the Member States, in Article 280 EC.

The European Communities have been provided with a budget since the start of European
integration. Under Articles 274 and 276 of the EC Treaty, the Commission is responsible,
before the Budgetary Authority made up of the European Parliament and the Council of the
European Union, for implementing the budget.

As regards the protection of the Community’s financial interests more specifically, the EC
Treaty sets tough requirements. Protection must be effective, dissuasive and equivalent in all
Member States. Effectiveness presupposes that beyond the administrative detection of fraud,
penalties will be genuinely imposed and enforced. Experience has shown that a credible
deterrent depends on being able, in the most serious cases, to come up not only with an
including mandatory
administrative response but also with a criminal-law response,
investigation measures and penalties extending as far as prison sentences. Lastly, equivalence
implies that enforcement is homogeneous throughout the Community.

These particularly tough requirements are fully justified by the fact that Community funds
have from the start of European integration constituted essentially shared interests.

However, these interests are the target of financial crime, which, in the most serious cases, is
organised. This category of crime uses all the latest communication techniques. It cares
nothing for frontiers and is distinctly transnational. In these circumstances, the Communities
must guarantee that offences of fraud and corruption are genuinely prosecuted in the courts.
The financial interests of the Communities justify particular means of protection.

3.1.2. Maintaining the current scope of protection of the Community’s financial interests

There is no question of the establishment of the European Public Prosecutor extending the
substantive competence of the Communities. The Community’s financial interests would
remain defined exactly as in Article 280 of the EC Treaty.

It should be pointed out that the financial interests of the Communities requiring protection
comprise the general budget, budgets administered by the Communities or on their behalf and
certain funds not covered by the budget,46 and which are administered for their own account
by Community bodies which do not have institutional status.47 The protection of the
Community’s financial interests concerns not only the management of budget appropriations,
but currently extends to all measures affecting or liable to affect its assets.48

On the expenditure side, this basically means expenditure managed by the Member States
subsidies paid for the purposes of agricultural guarantees49 and structural operations.50
Secondly, there is the expenditure directly managed by the Communities.51

46

47

48

49

The Development Funds administered by the Commission and the European Investment Bank, for
instance, are included.
Explanatory report on the Convention on the protection of the European Communities’ financial interests,
approved by the Council on 26.5.1997, section III.1.1 (OJ C 191, 23.6.1997, p. 1).
Second recital of Regulations Nos 1073/99 and 1074/99.
European Agricultural Guidance and Guarantee Fund, Guarantee Section

21

An example of a case with an internal component: diversion of funds intended for external
aid programmes

Following suspicions regarding the final destination of humanitarian aid under four
contracts awarded by the Humanitarian Office (ECHO), UCLAF conducted an
administrative investigation.52 One of the contracts concerned the African Great Lakes
Region, and the other three concerned the former Yugoslavia, in the period from 1993 to
1995. The funds allocated to company X responsible for their performance and to offshore
companies linked to it totalled ECU 2.4 million.

Initial checks in Member States A and B in 1997 revealed that part of the funds had been
used to illegally finance external personnel working for the Commission in its premises and
elsewhere.

the three contracts
An inspection mission in ex-Yugoslavia in 1998 revealed that
concerning that region had not actually been performed and that neither the scheduled staff
nor the equipment has been deployed for the purposes indicated.

Disciplinary measures were taken against several Community officials for receiving
payments from companies directly involved in the case where work contracted for was
wholly or partly unperformed. The penalties ranged from downgrading to dismissal with
part-loss of pension rights.

the resources
Although attempts were made to reconstitute the relevant expenditure,
deployed in the administrative investigation were inadequate to ascertain where all the
money went. For example, an on-the-spot inspection into company X in Member State B on
the basis of Regulation No 2185/96 in 1998 revealed no accounting records to justify the
amounts paid under the contracts.

Such facts as were likely to be used as a basis for criminal proceedings were transmitted to
the national prosecution authorities in Member State A and C. Court proceedings are still in
motion at the time of writing.

On the resources side,
this means first, revenue from duties in respect of trade with
non-member countries in the framework of the common agricultural policy and contributions
provided for under the common organisation of the markets in sugar,53 and second, customs
duties in respect of trade with third countries. The Prosecution Service’s responsibility should
also extend to revenue from the application of a uniform rate to the Member States’ VAT
bases, especially in transnational cases which are found to be particularly worthwhile treating
at Community level. But the European Public Prosecutor would not have jurisdiction for
revenue from the application of a uniform rate to the total GNP of Member States.

An example of an external case: VAT fraud

Apart from certain routine types of fraud (taxes evaded on sales or unjustly deducted on
fictitious purchases), there is a form of fraud linked to the Community’s current transitional
system of value added tax (VAT) based on the principle of taxation in the country of
destination. These fraudulent transactions are based on carrousels of goods and letter-box
companies formed for short periods only. Criminal organisations have set up fictitious

50

51

52

53

European Social Fund, European Regional Development Fund, European Agricultural Guidance and
Guarantee Fund - Guidance Section, Financial Instrument for Fisheries Guidance, Cohesion Fund.
Policies in a variety of fields such as training, youth, culture, information, energy, environment, internal
market, trans-European networks, research, external activities, etc.
This example has already been published. European Commission, Protection of the Communities’
financial interests and the fight against fraud, annual report 1999, COM(1999) 590, point 2.2.5.2.
The first two categories of own resource mentioned in Article 2(1) of Council Decision 94/728/EC,
Euratom of 31 October 1994 on the system of the European Communities’ own resources.

22

transactions to enjoy the benefit of the rules allowing VAT exemption for intra-Community
deliveries and favourable exemption rules for exports. The idea here was to use false
declarations as a means of obtaining refunds of VAT that was never paid in the first place.

The international VAT fraud techniques are well known. But it is very difficult in practice
for a single national authority to detect cases as the accounting situation in any one Member
to be in order. Most Member States
State taken in isolation will always appear
acknowledge that international VAT fraud is a major problem, even if national VAT fraud
is currently more significant in terms of total revenue lost than international VAT fraud.
International fraud particularly affects high value added products that are easy to transport
quickly (for example: computer components, mobile telephones, precious metals).

The current difficulties

VAT fraud cases are by no means all identified in time or, therefore, being dealt with
properly. OLAF can handle coordination only if
the relevant national authorities
specifically ask it to on a case-by-case basis.54 Cases of this type are often dropped because
of the transnational investigation and coordination efforts required at European level. Even
with Eurojust, coordination may not be enough as Eurojust will not be systematically
involved.55 The comprehensive information available to the European Public Prosecutor
and the priority enjoyed by the case before him would enable cases to be handled on a more
systematic basis.

Here, cooperation between OLAF and the judicial authorities in certain Member States has
been stepped up to make it easier to gather the evidence needed to commence court actions.
But the European Public Prosecutor would be useful in terms of the link that he could
establish between judicial and administrative (in particular tax) authorities. No national
judicial authority can work direct with all the Member States’ tax authorities as the
European Public Prosecutor could.

Thus defined, the financial interests of the Communities require an effective protection
mechanism in the criminal law. With the European Prosecutor, the Commission proposes to
establish a new instrument in order to permit the Community to assume effectively one of the
most demanding of its responsibilities in an area where the scope of its activity is well
defined.

3.2.

Towards a common investigation and prosecution area

The idea of a European Prosecutor arose from the need to resolve the now unjustifiable
contradiction between the fragmentation of Community territory into seventeen different
national criminal-law enforcement areas and the serious attacks on shared, specifically
Community, interests.

The Commission proposes that the European Prosecution Service exercise the powers that
may be conferred on it throughout the entire territory of the Communities as defined in
Article 299 of the EC Treaty.

In this territory, the European Public Prosecutor would act in a common investigation and
prosecution area, since his acts would have the same value in all the Member States. That is
the minimum condition for the European Public Prosecutor to be able to operate. Constituting
this common area represents a qualitative leap forward from mere coordination between
fragmented national areas.

54

55

COM(1999)590, point 2.3.
See below, Section 7.2.1 (Eurojust).

23

Looking beyond this vital first step, the substance of the common area could depend on the
options presented in this Green Paper. Its content will be determined by the degree of
harmonisation of the procedure, in particular as regards investigation measures and the
admissibility of evidence.

3.2.1. The powers of the European Public Prosecutor: centralised direction of investigation
and enforcement

Specialised in the protection of the Community’s financial interests but with jurisdiction for
the entire territory of the European Communities,
the European Prosecutor should be
provided with a coherent set of powers. Before going into detail below on possible
procedures, a general outline should be given of the Prosecutor’s role.56 Outline procedures
are set out in an annex.57

What is novel about the proposal is that it would place in the hands of a Community body the
centralised management of
the
preparatory and trial stages, acts done by the European Public Prosecutor would be valid
throughout that area. But the trial stage would remain entirely in national hands. The
establishment of the European Public Prosecutor is without prejudice to deepening general
judicial cooperation and to the Community-level prevention of international financial crime.

investigation and prosecution in a common area. At

• The European Public Prosecutor would gather all the evidence for and against the accused,
so that proceedings can be commenced where appropriate against the perpetrators of
common offences defined in order to protect the Community’s financial interests.58 He
should also be responsible for directing and coordinating prosecutions.59 The European
Public Prosecutor would have specialised jurisdiction, prevailing over the jurisdiction of
the national enforcement authorities but meshing with them to avoid duplication.60

• The European Public Prosecutor would have recourse to existing authorities (police) to
investigation activities in cases
regards

actually conduct
concerning him.61
It would further
investigations conducted within the European institutions.62

reinforce the judicial guarantee as

the investigations but would direct

• Action taken under the authority of the European Prosecutor, whenever it could impinge on
individual freedoms and basic rights, must be subject to review by the judge performing
the office of “judge of freedoms”.63 This review, exercised in a Member State, would be
recognised throughout the Community, to allow the execution of authorised acts and the
admissibility of evidence gathered in any Member State.

56

57

58

59

60

61

62

63

Point 6 looks at these powers from a procedural point of view.
See Annex 2.
Cf. point 5.1 (substantive law).
This principle is innovatory in the Community context but it is already accepted in the international legal
order. The Statute of the International Criminal Tribunal, adopted in Rome on 17.7.1998, provides for an
International Prosecutor with investigative powers for the purposes of prosecution in the territory of the
Party States. The European Union Member States signed the Convention and the Council states that it
wished it to enter into force rapidly (common position of 11.6.2001 concerning the International Criminal
Tribunal (OJ L 155, 12.6.2001 p. 19).
Cf. point 6.2.2.2 as regards hybrid cases.
Cf. point 6.2.3.2 (working relations with national investigation services).
Cf. point 7.3 (future role of OLAF) below.
See point 6.4 (guarantee of the involvement of a court).

24

• The European Prosecutor would have authority, subject to judicial review, to send for trial

in the national courts the perpetrators of the offences being prosecuted.64

• When cases come to trial the Prosecutor must prosecute cases in the national courts, in
order to defend the financial interests of the Communities. The Commission considers it
essential that the trial stage remain in national hands. There is no question of creating a
Community court to hear cases on the merits.65

3.2.2. A harmonious relationship with national systems of criminal law

The national legal systems are the foundation of the structure of criminal law providing
protection against cross-border crime, and they will continue to be indispensable. The
proposal to establish a European Public Prosecutor aims simply to plug a specific gap. There
is no plan to create a full and autonomous Community system of criminal law.

Instead,
the proposal seeks to create a supplementary mechanism that would be in a
justice systems by appointing Deputy
harmonious relationship with national criminal
European Public Prosecutors in the Member States (see next Chapter). Its ambition is to put
the national courts in a position where they can actually try cases concerning transnational
crime in an area where Community integration (common funds, own resources) is making
isolated attempts at enforcement more and more futile. The national courts acting as courts of
Community law would apply to this category of offences the same rules incorporated into the
national legal order as they already apply rules of Community law in all areas where the EC
Treaty operates.

But centralising the management of proceedings does not entail major changes to national
systems. For several decades now there has been a trend for the various legal traditions on
Europe to converge. Investigation and prosecution functions correspond to common needs
and exist in all Member States. Their structures vary but have none the less tended to come
closer. There are many causes for this, but the convergence is in large measure due to the fact
that the Member States have accepted the fair trial provisions of the European Human Rights
Convention. This is borne out by the work done by the experts representing the national
in both the continental and the common law traditions.66The
systems of criminal
proposal aims solely to make national judicial systems more effective in an area that is now of
intrinsically common concern. The European Prosecutor, then, would not so much involve a
transfer of existing powers as an allocation to a particular body of national powers held in
common.

law,

General Question What do you think of the general outline proposed for the European
Public Prosecutor, in particular as regards:

his scope of action (confined to the financial dimension of Community interests)?

64

65

66

Cf. point 6.3.1 (choice of State of trial).
Cf. point 6.3.2 (prosecutions).
Cf. The implementation of the Corpus juris in the Member States, op. Cit., Vol. 1, p. 42: “The result of
this evolution is that, from the legal point of view, the national systems in force in Europe have become
more compatible than they were previously. … This change makes a system based on synthesis possible
in the shape of a European Public Prosecutor. The European Public Prosecutor respects the principle of
public prosecution (from the inquisitorial tradition) but excludes the juge d’instruction, preferring a
“judge of freedoms”, to provide judicial guarantees in an impartial and neutral manner ( in the spirit of the
accusatorial tradition).”

25

his powers?

his relationship with national systems of criminal law?

26

4.

LEGAL STATUS AND INTERNAL ORGANISATION

The possible status and internal organisation of the European Public Prosecutor are worth
outlining here. The expression “European Public Prosecutor” may be used here to refer either
is
to the proposed body or to the person heading it (point 4.1). In the former case,
synonymous with the European Prosecution Service,
including its administrative staff
(point 4.3); in the latter case, it includes the Deputy European Public Prosecutors (point 4.2).

it

4.1.

Status of the European Public Prosecutor

The European Public Prosecutor would be a law officer exercising judicial functions, and the
rules governing his office, and especially the mechanisms for his appointment and removal
from office, should give him full legitimacy to perform these duties.

4.1.1. Principle of independence

The Commission has proposed that a provision inspired by those providing for
the
independence of the Members of the Court of Justice be inserted into the Treaty, stating that
“The European Public Prosecutor shall be chosen from persons whose independence is
beyond doubt and who possess the qualifications required for appointment to the highest
judicial offices in their respective countries.” In the performance of his duties, he shall neither
seek nor take any instructions.”67

This independence is an essential feature of the European Public Prosecutor. It is warranted
by the fact that the European Public Prosecutor would be a specialised judicial body. He
should be independent both of the parties to any dispute in the context of adversarial
proceedings68 and of the Member States and the Community institutions and bodies.

The Prosecutor should possess and should be seen to possess all the powers his office
requires. He should perform his duties impartially, being guided only by a concern to see the
law applied.

4.1.2. Conditions for appointment and removal from office

The method of appointing the European Public Prosecutor, and if necessary removing him
from office, ought to reflect the principles of independence and legitimacy.

4.1.2.1.

Appointment of the European Public Prosecutor

The Commission has proposed that the Prosecutor, meaning for present purposes the person
heading the European Prosecution Service, should be appointed by the Council acting by
qualified majority, on a proposal from the Commission, and with the assent of Parliament.69
This procedure takes over certain features of the procedure laid down by the Treaty of Nice
for the appointment of the Commission (qualified majority in the Council, vote by the
European Parliament). It would ensure the total legitimacy of the European Public Prosecutor.

The role of nominating the European Public Prosecutor given to the Commission would
proceed from its special responsibility for protecting Community financial interests.

67

68

69

Paragraph 2 of the draft Article 280a.
Cf. point 6.2.1 (general principles of the preparatory stage).
Paragraph 1 of the draft Article 280a.

27

The Commission is proposing that the Prosecutor’s term of office should be six years
non-renewable.70 The Prosecutor’s term would thus be a long one, longer than that of a
European Parliament or a Commission. The fact that his term could not be renewed would be
a very strong safeguard of his independence.71

There is also the question whether the European Public Prosecutor should be subject to the
Staff Regulations of Officials of the European Communities.

4.1.2.2.
European Public Prosecutor

Removal from office and other grounds for cessation of functions by the

The Commission proposes that the European Public Prosecutor should answer for his acts in
the event of serious misconduct in the exercise of his functions. In the Commission’s view the
disciplinary mechanism for removing the Prosecutor from office should, however, reflect the
principle of his independence. A decision of
this kind can be taken only by a
Community-level court of law, meaning the Court of Justice of the European Communities.

The draft Article 280a of the EC Treaty provides that “The Court of Justice may, on
application by the European Parliament, the Council or the Commission, remove him from
office if he no longer fulfils the conditions required for the performance of his duties or if he
is guilty of serious misconduct.”72

The general rules applying to the European Public Prosecutor should make provision for three
other cases in which the European Public Prosecutor ceases to perform his functions: death,
resignation and expiry of his term of office.

4.1.3. Hierarchical role of the European Public Prosecutor

The European Public Prosecutor as head of the European Prosecution Service would be
responsible for directing and coordinating investigation and prosecution activities for all
offences within his jurisdiction throughout the common territory defined for the purpose.

This responsibility should be accompanied by powers over the internal organisation of his
service, powers of investigation, powers over the delegated Prosecutors, and power to define
guidelines in relation to criminal procedure, within limits set by the Community legislature.73

4.2.

Decentralised organisation of the European Prosecution Service

The overall architecture of the prosecution service proposed by the Commission is based on a
division of tasks between a chief European Public Prosecutor, who would provide the
minimum degree of centralisation necessary at Community level, and Deputy Prosecutors,
who would be integrated into the national justice systems and who would actually bring
offences to trial.

70

71

72

73

Paragraph 1 of the draft Article 280a.
For the same reasons, the prosecutor at the future International Criminal Court is to have a term of nine
years non-renewable (Article 42 of the Statute of the International Criminal Court).
Paragraph 2 of the draft Article 280a.
Cf. point 6.2.2.1 (mandatory or discretionary prosecution).

28

4.2.1. Principle of decentralised Deputy European Public Prosecutors

In the spirit of the subsidiarity principle, the Commission is proposing that the organisation of
the European Public Prosecutor should be decentralised to guarantee integration into the
national legal systems without upheavals for them. The European Public Prosecutor would
rely on Deputy European Public Prosecutors in the Member States, so as to secure the link
between the Community mechanism and the national systems of justice.74

4.2.1.1.

General rules applying to Deputy European Public Prosecutors

Depending on the volume of cases to be handled and the internal court organisation of the
Member States, one or more Deputy European Public Prosecutors could be appointed in each
Member State. The Deputy Prosecutors would be appointed by the chief Prosecutor;
candidates would be nominated by their Member State of origin, from among national
officials who conduct criminal prosecutions in the particular Member State and who can
therefore claim relevant experience. Depending on the Member State these might be public
prosecutors in the domestic system, who may or may not be qualified judges, or, in countries
where an office of this kind is unknown, officials or civil servants who have been performing
these duties.

appointment,

The Commission does not necessarily envisage that the Deputy Prosecutors should have
respects regarding
autonomous status. They could retain their national status in all
recruitment,
routine
management, etc. Their hierarchical and disciplinary status would alone be affected for the
duration of their term of office, as set out below. This would be the solution having the least
in the way of implications for the law of the Member States. In any event the rules applicable
to the Deputy European Public Prosecutors should be reviewed in close cooperation with the
Member States, particularly in order to secure a genuine assurance of independence.

remuneration,

advancement,

protection,

social

Deputy European Public Prosecutors would be designated for a specified period. Unlike the
European Public Prosecutor, this term of office could be renewable, to take account of the
pool available for recruitment in the Member States. This would also allow appointees to
acquire a degree of specialisation in the field of the Community’s financial interests while
retaining their practical up-to-date familiarity with the national system.

Could this European office be combined with a domestic one? There are several options.

The first is that a Deputy European Public Prosecutor might be excluded from holding any
other office. The effect would be to make them into veritable specialists. The object would be
to prevent conflicts of interest and priorities in criminal policy, and ensure that the effect of
the prosecutors’ work was not diluted.

Secondly, the office of Deputy European Public Prosecutor might be simply a specialisation
(“two hats”). Deputy Prosecutors would have a duty to prosecute unlawful conduct harmful to
the financial interests of the Community, and in the second place would continue their
ordinary work, which would include the prosecution of crime. The Community interest should
prevail in the event of a conflict of interests. This solution has the advantage of facilitating the

74

COM(2000) 608.

29

processing of hybrid cases in which both Community and national interests are at stake (see
below).75

Third option: leave each Member State free to opt between the first two options.

The disciplinary liability of Deputy European Public Prosecutors in or in connection with the
exercise of their European function should be before the Court of Justice, for the sake of
symmetry with the rules for the European Public Prosecutor himself.76 As the Head of the
European Prosecution Service, he would have a role to play in the disciplinary procedure. The
heaviest disciplinary penalty for a Deputy European Public Prosecutor would be loss of his
European function.

If Deputy European Public Prosecutors were to be able to hold two functions, they would
remain liable in disciplinary matters as regards their national function, subject to sound
guarantees of their independence. The relationship between the effects of the two disciplinary
procedures must therefore be considered. Loss of the European function would have no
impact under Community law on the Deputy European Public Prosecutor’s national status.
But in the event of national disqualification, the Deputy European Public Prosecutor would no
longer meet one of the requirements for European office, and would therefore lose it
automatically.

4.2.1.2.

Role of Deputy European Public Prosecutors

The Deputy Prosecutors would have a vital role to play: anything the chief Prosecutor could
do he could delegate to his Deputies. In practice they would be the channel through which he
acted, because in most cases it would be a Deputy Prosecutor who would actually handle
investigations or prosecutions.

Each Deputy Prosecutor would in the ordinary course of events act within his own Member
State. But any Deputy Prosecutor might be authorised by the European Public Prosecutor to
take action in any other Member State, in cooperation with the Deputy Prosecutor for that
jurisdiction. Deputy Prosecutors would have a duty to assist one another.

Decentralisation of this kind is in line with the thinking that has governed the establishment of
judicial networks between the Member States (liaison magistrates, the European judicial
network, etc.).77 No separate Community system would be introduced:
the mechanism
proposed is based essentially on the capacities of the Member States in the spirit of
Community integration.

4.2.2. Subordination to the chief European Prosecutor

For obvious reasons of consistency and unity, however, the European Public Prosecutor
should be hierarchical. At the top, the European Prosecutor would be responsible for directing
and coordinating the work of the Deputy Prosecutors as investigations and prosecutions
progressed. The Deputy Prosecutors, for the duration of their term of office, would be
subordinate to the European Public Prosecutor on an exclusive or non-exclusive basis,
depending on the option selected, and would be bound by his instructions in both general and
specific matters. In any event they would be banned from receiving any instructions from

75

76

77

Cf. point 6.2.2.2 (hybrid cases).
Cf. point 4.1.2.2 (removal of European Public Prosecutor from office).
Cf. point 7.2 (institutional actors in the European Union).

30

their national authorities in any matter concerning the protection of the Community’s
financial interests.

The Commission takes the view that the European Public Prosecutor should be governed by a
principle of indivisibility of the kind that applies to prosecutors inside a single country,
meaning that any act done by a Deputy Prosecutor would commit the whole organisation.
Every Deputy Prosecutor would have the appropriate powers delegated to him by the chief
Prosecutor. Under the supervision of the European Public Prosecutor, therefore, one European
Prosecutor should be able to replace any other in law.

Question 1 What are your views on the proposed structure and internal organisation of the
European Public Prosecutor? Should the European function conferred on the Deputy
European Public Prosecutor be an exclusive function or could it be combined with a
national function?

4.3.

Means of action of the European Prosecution Service

It would then be for Community secondary legislation to determine the rules governing the
European Public Prosecutor, and particularly the more practical aspects (location, budget,
staffing and so on); such legislation would be adopted in accordance with Article 251 of the
EC Treaty, that is to say by qualified majority in Council and codecision with Parliament.

The European Public Prosecutor being organised on a decentralised basis, the structure of the
headquarters of the new body to be set up should be the simplest compatible with sound
operation. The European Public Prosecutor’s own staff would be small compared to the staffs
of the Deputy Prosecutors, which would account for the bulk of the human and material
resources needed. Synergy with existing national structures should contribute to the efficiency
of the whole.

The European Public Prosecutor would have full authority over the management of human
and operational resources at his headquarters. He should be assisted by one or more Deputies
for these purposes.78

The European Public Prosecutor should have his own budget, charged to the general budget
of the European Communities. This budget would be managed on a totally independent basis
by the European Public Prosecutor in accordance with the rules of the Treaty and the financial
legislation implementing them. Each Deputy European Public Prosecutor would remain
subject to national rules and be remunerated by the Member State. But if there are extra
operational costs for the Member States as a result of the European Prosecution Service, they
could be charged to the European Public Prosecutor’s budget.

The European Prosecution Service’s staff could be recruited, appointed and managed by the
chief prosecutor, in the case of headquarters staff, and, in the case of decentralised staff, by
the Member State in accordance with its own rules. Th European Public Prosecutor’s own
powers in staff matters should be exercised in compliance with the relevant Community rules,
in particular the Staff Regulations.

78

Note for comparison purposes that the staff of the Prosecutor at the International Criminal Court will be
recruited, appointed and managed by the Prosecutor, assisted by one or more Deputy Prosecutors
(Articles 42 and 44 of the Court’s Statute).

31

The chief prosecutor can be expected to establish his headquarters in accordance with the
procedure for Community bodies, but the deputy prosecutors, at the discretion of the Member
States, would be based in their respective national or regional capitals, or in any other place
that might be better suited to the performance of their duties, taking account of the location of
the national courts in which they would have to plead.

32

5.

SUBSTANTIVE CRIMINAL LAW

The Commission has proposed a provision in the EC Treaty that the Council, in codecision
lay down the general conditions governing the
with the European Parliament, “shall
performance of
in
particular: (a) rules defining the facts constituting criminal offences relating to fraud and any
other illegal activity prejudicial to the Community’s financial interests and the penalties
incurred for each of them;…”.

the European Public Prosecutor and shall adopt,

the functions of

There is a need for specific rules relating to the definition of these offences (point 5.2) and the
corresponding penalties (point 5.3). The utility of providing for more general substantive rules
to assist the European Public Prosecutor in his function, governing matters such as criminal
liability (point 5.4) or limitation periods (point 5.5) will have to be considered in the light of
the acquis. The question of the most suitable legislative technique arises for each of these
areas (point 5.1).

5.1.

Choice of legislative technique: Community unification or harmonisation of
national legislation

The Commission is of the opinion that establishing a common investigation and prosecution
area relating specifically to the protection of the Community’s financial interests does not
necessitate the general codification of the Member States’ criminal law.

To operate effectively the European Public Prosecutor will need a set of substantive rules like
those applied by national enforcement authorities.

In theory, different techniques could be combined to define such rules:

– reference to the Member States’ domestic law purely and simply (with no harmonisation);

– harmonisation of part of the national law, to an extent to be determined, with reference for

the rest to the national law;

– total harmonisation of certain national provisions, the Community rules then superseding

the national rules;

– unification, meaning the creation of a corpus of autonomous Community law, separate

from the law of the Member States.

In practice, the acquis regarding criminal protection of the Community’s financial interests so
far has followed the harmonisation technique, in varying degrees depending on the area. That
is the technique underlying both the Convention of 26 July 1995 and its Protocols and the
proposal for a Directive of 23 May 2001.

Looking further, the question of the choice of the most suitable method of establishing the
common substantive law needed if the European Public Prosecutor is to operate effectively
arises repeatedly in this Green Paper.

In general terms there are two distinct approaches that must be reconciled. The first is total
harmonisation or unification. The European Public Prosecutor will find it much easier to act if
the substantive law is harmonised or unified. Total harmonisation or unification of the law
would ensure by definition that equivalence of protection throughout the Community that the

33

EC Treaty demands. Lastly, as far as litigants are concerned, this approach would help to
establish greater certainty as to the law and simplify access to the relevant rules. But it is
legitimate only if it is in proportion to the specific objective pursued: the criminal protection
of the Community’s financial interests. It will be all the easier to imagine if it applies in
matters within the specific jurisdiction of the European Public Prosecutor, such as the
definition of the components of offences or the corresponding limitation periods.

The second approach is the reference wholly or partly to national law. This would seem to be
the most suitable method for determining general rules in matters going beyond the protection
of the Community’s financial interests, despite the diversity that it inevitably preserves in
terms of the objective of attaining equivalent protection throughout the Community. The
national legal orders will be all the less affected as the European Public Prosecutor will have
to take account of each of them, depending on the Member State in which he acts.

The sought-for reconciliation between these two approaches entails finding an answer in
every area of the substantive law to two questions: what rules should be unified or
harmonised? And, in the latter case, how far should the harmonisation go? These are the
questions addressed in the next few sections.

The authors of the Corpus juris proposed a higher level of harmonisation of the general
criminal law. But the Commission considers that such harmonisation must be proportionate to
the specific objective of the criminal protection of the Community’s financial interests and
proceed on a variable degree of intensity depending on the areas concerned (see points 5.2 to
5.5).

And it must be borne in mind in all that follows that the European Public Prosecutor must be
part of an evolving dynamic. For one thing the Commission in this Green Paper is concerned
to launch a debate on the minimum needed for the European Public Prosecutor to be able to
operate effectively. Once the Prosecutor has been established on the basis of a sufficient set of
common rules and principles, after the time needed to adopt the requisite basis and legal
framework, experience will show whether it is necessary to amplify the minimum needed for
him to operate.

The diversity of the national systems of criminal law should show a tendency to become less
pronounced as progress is made in the broader context of the area of freedom, security and
justice, with the spin-off that the European Public Prosecutor’s job will become all the easier.
The trust placed by the Commission in the harmonisation technique is based on this: the
specific harmonisation proposed for the European Public Prosecutor will be amplified by a
general evolution of his legal environment, guided by the principle of mutual recognition.

5.2.

Common definitions of offences

the Commission could prefer a high degree of
For the definition of these offences,
harmonisation corresponding to a level of precision no less than that of its proposal for a
Directive of 23 May 2001.

The effect of the principle of legality is that the prosecutor can be responsible for proceeding
against only certain very clearly defined offences. If there is to be a prosecution service with
jurisdiction throughout the Community, a common definition of the offences is therefore
clearly an essential condition for its operation.

34

In accordance with the principle of speciality applied to the European Public Prosecutor, even
if other offence could be envisaged (point 5.2.3), these common offences should focus on the
protection of the Community’s financial interests. There is already an agreement between the
Member States on certain offences (point 5.2.1). Others might be envisaged (point 5.1.2),
based on, among other things, the Corpus Juris.

5.2.1. Offences for the protection of the Community’s financial interests, on which the
Member States are already in agreement

There is already substantial agreement among Member States on the content of what may
become the nucleus of a special criminal law in this field. The provisions on substantive
criminal law of the Brussels Convention of 26 July 1995 on the protection of the financial
interests of the European Communities and its additional protocols,79 which have been wholly
incorporated in the proposal for a Directive of 23 May 2001,80 are an unavoidable point of
reference when it comes to defining the offences which might fall within the jurisdiction of
the European Prosecutor. They are fraud, corruption and money-laundering in connection
with those offences.

5.2.1.1.

Fraud

Article 3 of the proposal, which reproduces the terms of Article 1 of the Convention of 26
July 1995, defines fraud affecting the Community’s financial
in respect of
expenditure, as “any intentional act or omission relating to the use or presentation of false,
incorrect or incomplete statements or documents which has as its effect the misappropriation
or wrongful retention of funds from the general budget of the Community or budgets managed
by, or on behalf of, the Community, non-disclosure of information in violation of a specific
obligation, with the same effect, [or] the misuse of such funds for purposes other than those
for which they were originally granted”.

interests,

The same instruments define fraud affecting the Community’s financial interests, in respect of
revenue, as “any intentional act or omission relating to the use or presentation of false,
incorrect or incomplete statements or documents which has the effect of unlawfully reducing
the resources of the general budget of the Community or budgets managed by, or on behalf of,
the Community”.

Such acts must be punishable either as a principal offence or as participation in, instigation of,
or an attempt to commit, fraud.

Beyond this potential acquis, the definition might be unified (expenditure and revenue) and
broadened. Along the lines of the Corpus Juris’s proposal, a single definition of fraud might
be adopted irrespective of the subject-matter, be it Community expenditure or revenue.81 The
effect of the fraud might be extended to include the endangering of the Community’s financial
interests so as not to make the successful outcome of the fraudulent act a precondition for its
prosecution. The element of intention might be supplemented by the taking into account of
cases of gross negligence.

79

80

81

OJ C 316, 27.11.95, p. 48; OJ C 313, 23.10.1996, p. 1; OJ C 221, 19.7.1997, p. 11; OJ C 151 20.5.1997,
p. 1. See also the explanatory reports on the Convention (OJ C 191, 23.6.1997, p. 1) and the Second
Protocol (OJ C 91, 31.3.1999, p. 8).
COM(2001) 272, referred to above.
Article 1 of the Corpus juris.

35

5.2.1.2.

Corruption

According to Article 4(1) of the proposal for a Directive, which reproduces the terms of
Article 2 of the Protocol of 27 September 1996 to the 1995 Convention,82 passive corruption
consists of “the deliberate act on the part of an official, whether directly or through an
intermediary, of requesting or receiving advantages of any kind whatsoever, for themselves or
for a third party, or accepting a promise of such an advantage, as inducement for them to
breach their official obligations and carry out or refrain from carrying out an official duty or
an act in the course of their official duties in a way that damages or is likely to damage the
Community’s financial interests”.

Active corruption is for its part defined in Article 4(2) of the proposal for a Directive, which
reproduces the terms of Article 3 of the same Protocol, as “the deliberate act of promising or
giving, directly or through an intermediary, an advantage of any kind whatsoever to officials,
for themselves or for a third party, as inducement for them to breach their official obligations
and carry out or refrain from carrying out an official duty or an act in the course of their
official duties in a way that damages or is likely to damage the Community’s financial
interests”.

Corruption, both passive and active, must be punishable either as a principal offence or as
participation in, or instigation of, the conduct in question (Article 5 of the above-mentioned
Protocol).

5.2.1.3.

Money-laundering

Article 6 of the proposal for a Directive, which reproduces the terms of Article 1 of the
Protocol of 19 July 1997 to the 1995 Convention, refers, for the definition of money
laundering related to the proceeds of fraud - at least in serious cases - and of active and
passive corruption, to the general concept of money laundering as defined in the amended
Directive of 10 June 1991.83

The latter defines money laundering as the act of committing intentionally either “the
conversion or transfer of property, knowing that such property is derived from criminal
activity or from an act of participation in such activity, for the purpose of concealing or
disguising the illicit origin of the property or of assisting any person who is involved in the
commission of such activity to evade the legal consequences of his action”, or “the
concealment or disguise of the true nature, source, location, disposition, movement, rights
with respect to, or ownership of property, knowing that such property is derived from
criminal activity or from an act of participation in such activity”, or “the acquisition,
possession or use of property, knowing, at the time of receipt, that such property was derived
from criminal activity or from an act of participation in such activity”. Moreover, money
laundering is to be regarded as such even where the activities which generated the property to
be laundered were perpetrated in the territory of another Member State or in a third country

Participation in, association to commit, attempts to commit and aiding, abetting, facilitating
and counselling the commission of any of the above-mentioned acts are also an offence.

82

83

The concept of civil servant (official) is defined in Article 2 of the proposal for a Directive, taking over
the definition in Article 1 of the 27 September 1996 Protocol to the 1995 Convention.
Third indent of Article 1 of Council Directive 91/308/EEC of 10 June 1991, as amended, on the
prevention of the use of the financial system for the purpose of money laundering (OJ L 166, 28. 6. 1991,
p. 77). 6. .

36

5.2.2. Offences above and beyond the protection of the Community’s financial interests

Since the establishment of a European Public Prosecutor represents a qualitative leap forward
towards the area of freedom, security and justice, the thinking here cannot be confined to the
hypothesis of merely taking over the Union acquis. The European Public Prosecutor should
have jurisdiction to proceed against other offences connected with the protection of the
Community’s financial interests, as considered above.

The definition of these common offences could be based on the progress made under the third
pillar and the Corpus juris proposals, whether earlier definitions are to be developed or new
ones devised alongside them. The Commission is particularly interested in this kind of
approach.

5.2.2.1.

Market-rigging

The idea of creating a Community level offence of market-rigging is worth pursuing in view
of the amounts involved and the major shortcomings in the laws of a number of Member
States.84 In particular, bringing a charge of fraud is ineffective in that material damage is
difficult to prove.

Getting, or trying to get, a specific bid accepted by any contract-awarding authority whatever,
using means that violate Community rules on public procurement, such as an illegal
agreement, might therefore be made a common criminal offence if there is actual or potential
damage to the Community’s financial interests.

5.2.2.2. Conspiracy

As has been shown for a number of years now by the operational activities of the Commission
and the Member States, organised crime is often behind offences against the Community’s
financial interests. It might therefore be necessary to focus specifically on membership of a
criminal organisation in order to prevent the commission of the other common offences.85

One does not have to wait until the Community suffers financial damage before prosecuting
those intent on methodically causing such damage. Moreover, the availability of an offence of
this type can help to dismantle a conspiracy by leading the way up to its instigators. This
solution would give practical expression in a specific area to the principle asserted by the
Tampere European Council, “deeply committed to reinforcing the fight against serious
organised and transnational crime”.86

The offence might thus be created, either as a common offence in its own right or as an
aggravating circumstance in the event of one of the other common offences considered so far,
of conspiracy87 in the form of membership of a permanent organisation consisting of several
persons with a view to committing acts of fraud, corruption, money laundering or any other
act covered by common offences still to be defined.

84

85

86

87

The implementation of the Corpus juris in the Member States, op. cit., Vol. 1, Part II, Chapter 1, §I-2.
See in particular Article 4 of the Corpus juris.
Conclusions, point 40.
Joint Action of 21.12.1998 adopted by the Council on the basis K.3 of the treaty of the European Union,
on making it a Criminal Offence to Participate in a Criminal Organisation in the Member States of the
European Union (OJ L 351, 29.12.1998).

37

5.2.2.3. Abuse of office

Acts done by officials to the detriment of financial interests do not always entail a benefit for
them, notably in corruption cases. That is why the more general and secondary offence of
abuse of office to the detriment of the Community’s financial interests might be envisaged.88

The idea would be to make it a full criminal offence for a civil servant in charge of the
management of Community financial interests to act intentionally to their detriment, abusing
for that purpose the powers conferred on him.

5.2.2.4. Disclosure of secrets pertaining to one’s office

law of officials and other servants of the European Communities,

In the Explanatory Memorandum to the Draft Treaty of 1976 on the liability and protection
under criminal
the
Commission already stated that neither the national authorities nor private organisations
should hesitate to supply confidential information to the Community authorities on the ground
that breaches of secrecy are not criminal offences.89

Consequently it could be defined as a Community criminal offence for a public servant,
contrary to a professional obligation of secrecy, to divulge information acquired in the
performance or on the occasion of his functions where divulging the information is or may be
detrimental to the Community’s financial interests.90

5.2.3. Offences that might be envisaged for the protection of the Community’s financial
interests

For a fully informed debate, it is worth remembering that the Commission proposal could
have ranged beyond the criminal-law protection of financial interests to provide for the
general protection of the criminal law for the European public service, as envisaged at the
beginning of the 1970s.91 This option might have founded, for example, a general reference,
not tied to the Community’s financial interests, to abuse of office and the disclosure of secrets
pertaining to one’s office, or to giving the European Public Prosecutor the power to proceed
against such simple offences as theft of personal effects in the institutions, violations of
data-protection or favouritism in the application of Community law.

that

But
Community’s financial interests (proposed Article 280a).

is not

the purpose of the Commission’s proposal, which is confined to the

Question 2 For what offences should the European Public Prosecutor have jurisdiction?
Should the definitions of offences already provided for in the European Union be
amplified?

88

89

90

91

See in particular Article 7 of the Corpus juris.
Draft for a Treaty amending the Treaty establishing a Single Council and a Single Commission of the
European Communities so as to permit the adoption of common rules on the liability and protection under
criminal law of officials and other servants of the European Communities (OJ C 222, 22.9.1976).
See in particular Article 8 of the Corpus juris.
OJ C 222, 22.9.1976.

38

5.3.

Common penalties

It is also important to establish Community rules relating to the penalties corresponding to the
offences within the European Public Prosecutor’s jurisdiction.

A priority harmonisation effort here is clearly justified and would by no means by in
contradiction with the conclusions of the Tampere European Council that: “with regard to
national criminal law, efforts to agree on common definitions, incriminations and sanctions
should be focused in the first instance on a limited number of sectors of particular relevance,
such as financial crime (money laundering, corruption, Euro counterfeiting), ...”.92

Respect for the acquis in relation to protection of the Community’s financial interests means
not setting the level of criminal penalties below that which is already provided for by the
proposal for a Directive of 23 May 2001 and the provisions of Conventions and similar
instruments that it takes over. These instruments stipulate that the conduct referred to therein
consisting of fraud, corruption and money laundering must be punishable by effective,
proportionate and dissuasive criminal penalties, including, at least in serious cases, penalties
involving deprivation of liberty which can give rise to extradition. They provide for
confiscation of the corresponding instruments and proceeds.

Article 3 of the proposal for a Directive, which reproduces the terms of Article 2 of the
Convention of 26 July 1995, states that serious fraud consists of any case of fraud involving a
minimum amount which may not be more than
50 000. Article 11 of the proposal for a
Directive, which reproduces the terms of Article 4 of the Protocol of 19 June 1997, provides
for the imposition of penalties, including those of a criminal-law nature, on bodies corporate
held liable for fraud, active corruption or money laundering.

€

the Commission considers that

To respect the principles that offences and penalties must be defined by law and must be
proportionate to the offence, restated by the Charter of Fundamental Rights of the European
Union,93
in the
it
harmonisation of criminal penalties incurred for the offences defined here. But while this
harmonisation effort should be pitched higher in view of the common nature of the relevant
offences, it must remain consistent with the more general debate in the European Union on
the harmonisation of penalties.

is necessary to go much further

The maximum penalties – both custodial sentences and fines – should be determined by
Community legislation, leaving the national courts free within these limits to assess the
sentence actually passed. The possibility of alternative or additional penalties should also be
envisaged. In particular, a Community type of additional penalty could be established, such as
exclusion from the European public service, from access to grants or from access to public
contracts if Community financing is applied for.94

The effects of aggravating or mitigating circumstances on the maximum levels of penalties
could be provided for in the Community legislation, but these circumstances themselves could
be left to be defined by national law. Likewise, provision should be made for the penalties
applicable where several offences are committed.

92

93

94

Presidency Conclusions, point 48.
Article 49 of the Charter of Fundamental Rights of the EU.
See in particular Article 14 of the Corpus juris.

39

The European Public Prosecutor should also be empowered to apply for confiscation of the
instruments and proceeds of offences within his jurisdiction, in the spirit of the Union acquis
here.95 And rules governing the publication of final judgments could be devised.

5.4.

Liability of legal persons

Regarding criminal liability, the Commission considers that the principle of proportionality
would be respected by abiding by the acquis and the degree of harmonisation that it suggests
in its proposal for a Directive of 23 May 2001. With the exception of the existing provisions
concerning the liability of heads of businesses and legal persons, there would be a general
reference to the law of the Member States. This solution, which the Commission prefers,
would provide the minimum basis needed for the European Public Prosecutor to operate.96

Articles 8 and 9 of the proposal for a Directive of 23 May 2001, which reproduce the terms of
Article 3 of the Convention of 26 July 1995 and of the Protocol of 19 June 1997, already
provide for a degree of harmonisation of the rules on the liability of (a) heads of businesses
and (b) bodies corporate.

On this basis, heads of businesses or other persons with decision-making or controlling
powers within a business could be held criminally liable in accordance with the principles
determined by the domestic law, in the event of fraud, corruption or money-laundering the
proceeds of such offences committed by a person under their authority on behalf of the
business.

Likewise, legal persons should be liable for commission, participation (as accomplice or
instigator) and attempts as regards fraud, active corruption and capital laundering, committed
on their behalf by any person who exercises managerial authority within them.97 There should
also be provision for them to be liable where defective supervision or management by such a
person made it possible for a person under his authority to commit the offences on behalf of
the legal person.

Liability of a body corporate under paragraphs 1 and 2 does not exclude criminal proceedings
against natural persons who are perpetrators, instigators or accessories in the fraud, active
corruption or money laundering.

5.5.

Rules of limitation

Limitation in respect of offences within the jurisdiction of the European Public Prosecutor
would constitute a ground for terminating the action. The rules relating to limitation vary
widely from one Member State to another, and will do so even more with enlargement of the
Union. Equal treatment of all litigants accordingly requires a real harmonisation effort.

95

96

97

Council Framework Decision of 26.6.2001 on money laundering, the identification, tracing, freezing,
seizing and confiscation of instrumentalities and the proceeds of crime (OJ L 182, 5.7.2001, p .1).
For a different approach, supporting greater harmonisation of the general of criminal liability, see Articles
9 to 13 of the Corpus juris, proposing that the Convention-based rules on the liability of businesses be
amplified and that the bases be laid for a Community definition of mens rea, of mistake, of individual
liability and of attempts.
Whether the person acts individually or as a member of a body within the legal person. The managerial
authority referred to here may be a power to represent the legal person as agent or authority to take
decisions on behalf of the legal person or to exercise powers of control within it.

40

Preserving excessive diversity when the aim is to achieve maximum effectiveness in
enforcing the law against practices harming the Community’s financial interests would be a
source of difficulties. If several persons are prosecuted in different Member States for
committing the same offence, there is a risk of unequal treatment. Where one and the same
person has committed identical offences, a prosecution that has been dropped in one Member
State might still be available in another, and proceedings might be focused in that other State
for that reason alone.

Moreover, the European Public Prosecutor’s prosecution activities should not be hampered by
an excessively short limitation period. The experience accumulated by the Commission and
the Member States with the administrative detection of fraud confirms the length of time
needed for investigations. The complexity of financial cases, the transnational nature of the
forms of conduct concerned, and the seriousness of the offences, often involving organised
crime, compound the difficulties at the investigation stage. By way of example, the Corpus
juris argues, in respect of all the offences it defines, in favour of a period of five years out of a
maximum ten.

The Commission’s preference is for at least a Community definition of the duration of
limitation periods for offences within the European Public Prosecutor’s jurisdiction. In the
absence of existing provision on this point, it wishes to consider the duration of the limitation
period to be set for each of the offences, as there is no obvious identical period for all
offences. For all the other rules relating to these matters, in particular the interruption of the
limitation period, the possibility of referring to national law, subject to mutual recognition
between Member States, should be considered.

Question 3 Should the establishment of the European Public Prosecutor be accompanied
by certain further common rules relating to:

– penalties?

– liability?

– limitation?

– other matters?

If so, to what extent?

41

6.

PROCEDURE

The Commission has proposed writing into the EC Treaty a provision that the Council of the
European Union, acting in accordance with the procedure laid down by Article 251
(codecision with the European Parliament), “shall lay down the general conditions governing
the performance of the functions of the European Public Prosecutor and shall adopt, in
particular ... (b) rules of procedure applicable to the activities of the European Public
Prosecutor and rules governing the admissibility of evidence”; (c) rules applicable to the
judicial review of procedural measures taken by the European Public Prosecutor in the
exercise of his functions.”

In order to operate properly, the European Public Prosecutor needs to have a procedural
framework that meshes well with the national judicial systems. This procedural framework
should be defined at
in accordance with the principles of
subsidiarity and effectiveness in both European and national terms.

the most appropriate level

The methods identified in the previous Chapter could be combined for this purpose. Since this
is necessary for the European Public Prosecutor to operate effectively, it will be essential to
define a common set of European Rules of Procedure. But the total or partial approximation
of national procedures may be enough if all the European Public Prosecutor really needs is
equivalence between the Member States. Otherwise, reference should be made wherever
possible to national law. Regarding criminal procedure, the Commission is particularly
attached for the purposes of this Green Paper to the principle of mutual recognition.

At this stage the powers of the European Public Prosecutor set out in general terms above98
and the corresponding guarantees in terms of fundamental freedoms should be analysed in
greater detail as regards each stage of the procedure. The question of judicial review is
considered in Chapter 8.

The European Public Prosecutor would have to direct and coordinate investigations and
proceedings with a view to protecting the Community’s financial interests. To this end,
having received proper information (point 6.1), provision should be made for him to carry out
investigations (point 6.2), either directly or by delegation. He should also take the decision to
send the accused for trial and choose the national court where this would be done (point 6.3).
But in view of their impact on basic human rights, some of these acts would have to be
subject a priori control by a court (see point 7.3) in order to ensure that the principles of
legality and proportionality, inter alia, are complied with.

6.1.

Information and referral

Unlike information, open to all without any obligation to respond, the expression ‘referral to
the European Public Prosecutor’ in this Green Paper means the official information laid
before him by a public authority for the purposes of proceedings to be taken. Upon receiving
a referral the European Public Prosecutor would therefore be obliged to give a reasoned reply
to the request put to him.

It should be made possible for the European Public Prosecutor to receive information or a
referral regarding any fact potentially constituting one of the predefined Community

98

Cf. point 3.3 (powers of the European Public Prosecutor).

42

offences.99 The question then arises as to who would have the power to do this and to what
extent doing so should be mandatory or discretionary.

Europe’s citizens are entitled to demand a high level of protection for the Community’s
financial interests. Any natural or legal person, whether or not a Union resident, could inform
the European Public Prosecutor of facts in his possession, by any means whatever. The
European Public Prosecutor could then act as required on any information thus received.100

In addition there could be a specific obligation for certain national and Community authorities
having defined categories of powers to refer facts to the European Public Prosecutor.101

The Commission, on the basis of comparable obligations regularly found in national systems,
has a preference for mandatory referral or information to the European Public Prosecutor by
Community authorities and staff102 and by national authorities of all kinds in performance of
their duties: staff of government departments, especially the customs and tax authorities,103
police forces and judicial authorities.

The philosophy underlying the proposal to establish a European Public Prosecutor is that
specifically Community interests should be matched by a European enforcement function in
relation to perpetrators of offences against them. To provide for only discretionary referrals to
the European Public Prosecutor would run counter to that philosophy. National enforcement
authorities do not have the broad, Community-wide view of the cases they handle. What may
look like a trivial case to them may well form part of a more serious complex of offences.
Hence the importance attached by the Commission to the principle of systematic referrals to
the European Public Prosecutor wherever the Community’s financial interests are at stake.

Cases could be referred to the European Public Prosecutor by the relevant national or
Community authorities, or he could take them up of his own motion on the basis of the
information in his possession.104

Question 4 When and by whom should cases be referred to the European Public
Prosecutor?

6.2.

The preparatory stage

Under Article 280a of the EC Treaty as proposed by the Commission, the European Public
Prosecutor would be ”responsible for detecting, prosecuting and bringing to judgment the
perpetrators of offences prejudicial
interests and their
accomplices ... in accordance with the rules provided for by” the relevant Community
legislation. The preparatory stage begins with the first investigative measures ordered by the

to the Community’s financial

99

100

Cf. point 5 (substantive law).
See, by way of comparison, Article 17 of the Statute of the International Criminal Court for Rwanda and
Article 18 of the Statute of the International Criminal Court for the former Yugoslavia.

101 Without prejudice to obligations to report

irregularities to the Commission under the Community

102

103

104

legislation in the context of administrative and financial management and control.
See point 7.3 for the role of the European Anti-fraud Office.
these duties of
The tax authorities are subject
confidentiality are never without exceptions. New exceptions will have to be provided for so that the
European Public Prosecutor can be given information.
See Annex 2, first procedure.

to extensive obligations of confidentiality. But

43

prosecutor and ends at the point where a decision is taken to close the case or commit it for
trial.105

6.2.1. Fundamental rights

One preliminary point: it is clear that the European Public Prosecutor must act with full
respect for fundamental rights as secured by Article 6 of the Union Treaty, the Charter of
Fundamental Rights of the European Union and the European Convention for the Protection
of Human Rights and Fundamental Freedoms. These principles include rights of ownership,
respect for private life and the confidentiality of correspondence and communications.

The European Public Prosecutor should also act in accordance with the Treaties, particularly
the Protocol on the Privileges and Immunities, and in compliance with the Staff Regulations
of Officials and the Conditions of Employment of Other Servants of the European
Communities.

6.2.1.1. Defence rights and protection of the accused

Without claiming to be exhaustive, it is worth stressing the importance of certain general
principles at the preparatory stage. At this stage, the European Public Prosecutor would
conduct the investigations needed to ascertain the truth, gathering all evidence that will help
to prepare the case. Investigations must be conducted with all due despatch106 to assemble all
evidence for and against the suspect.

The performance by the European Public Prosecutor of acts adversely affecting the accused
would then be subject to the principle of the presumption of innocence107 and the principle of
adversarial proceedings. For the Green Paper the latter principle means that the parties and
their lawyers are entitled to have access to the European Public Prosecutor’s file. As far as the
accused is concerned, it also means that defence rights must be respected, and particularly the
to make his views known on the facts concerning him.108 The European Public
right
Prosecutor should also be subject to the principle of equity and to compliance with the law as
regards the fact that his conclusions must be based solely on the valid evidence before him.

6.2.1.2. Double jeopardy

Article 50 of the Charter of Fundamental Rights states that “No one shall be liable to be tried
or punished again in criminal proceedings for an offence for which he or she has already
been finally acquitted or convicted within the Union in accordance with the law”. This “ne bis
in idem” principle is widely recognised by a large number of international conventions.109

The importance of applying it to the European Public Prosecutor is beyond doubt. But the
question arises as to when the principle is to be applicable during the preparatory stage. The
case-law on this point is not entirely clear.110

105

106

107

108

109

110

See Annex 2, second procedure.
Article 6(1) of the European Convention for the Protection of Human Rights and Fundamental Freedoms
and Article 47(2) of the Charter of Fundamental Rights of the European Union (reasonable period).
Article 6(2) of the Convention and Article 48(1) of the Charter.
Article 6(3) of the Convention and Article 48(2) of the Charter.
See, in particular, Article 7 of the Convention of 25 July 1995 on the protection of the Community’s
financial interests and Article 54 of the Convention implementing the Schengen Agreement.
Case C 187/01, now pending before the Court of Justice.

44

But in the context of this Green Paper there is a hypothesis that can be put forward. The
European Public Prosecutor should not be able to open proceedings against a person who has
already been acquitted or convicted by a final judgment of a criminal court for the same
offence. But he must be in a position to ascertain that the case really does concern the same
person and the same offence. It might therefore be possible to provide that the European
Public Prosecutor may order a preliminary enquiry, not having the status of commencement
of proceedings, to ensure that the “ne bis in idem” principle is applied. If the enquiry shows
that the case has already come to judgment, the European Public Prosecutor should abandon
it. The ne bis in idem principle should apply also to other final decisions that preclude
subsequent repeat prosecutions, such as a settlement. But if it is the investigation reveals that
the national enforcement authorities have dropped the case for lack of evidence, the European
Public Prosecutor may proceed at his level if he has new evidence.

6.2.2. Opening of investigations and enforcement proceedings

Investigations may begin only after proceedings have been commenced on orders from the
European Public Prosecutor. The prosecutor would initiate enquiries only if the known facts
might constitute a Community offence within the prosecutor’s jurisdiction, or at least give
reason for suspecting that such an offence had been committed.

6.2.2.1. Obligation or discretion to prosecute?

Once these conditions are met, a vital question arises: would the European Public Prosecutor
then have the power or the duty to proceed? In the former case, there would be a discretionary
prosecution system; in the latter, a mandatory prosecution system. National systems respond
to this question in different ways, but always on a hybrid basis.

Where the European Public Prosecutor is concerned, the question will have to be settled at
Community level. The purpose of establishing a European Public Prosecutor is to reinforce
and unify the protection of the Community’s financial interests. Basically that means uniform
proceedings throughout the European law-enforcement area and therefore no discretion for
the European Public Prosecutor. And the European Public Prosecutor’s independence is
neatly matched by strict application of the law. The Commission’s preference is accordingly
for a mandatory prosecution system, modified by exceptions.

The tendency towards approximation of national systems should facilitate this solution. The
hybrid mandatory and discretionary system is now typical of the situation in the Member
States. Where prosecution is discretionary, for example, the prosecutor has to state reasons for
a decision to close a case without further action, and such decisions can be challenged. And
where prosecution is mandatory the requirement is rendered more flexible by allowing a
variety of cases to be closed subject to stated conditions.

Being subject to the principle of mandatory prosecutions, the European Public Prosecutor
would have the possibility of closing a case not only on technical grounds that he cannot
escape111 but also on discretionary grounds such as those set out below.

First, the exceptions from the principle of mandatory prosecution could be designed primarily
to avoid overburdening the European Public Prosecutor with cases of minor importance for
the protection of the Community’s financial interests, applying the de minimis rule. There are
several ways of going about this. A criterion such as “minor impact on the Community’s

111

Cf. point 6.2.4.1 (closure of proceedings or decision not to prosecute).

45

financial interests” could be left to the discretion of the European Public Prosecutor, subject
to judicial review. More specifically, a value threshold could be set, below which proceedings
would be in the European Public Prosecutor’s discretion. The first is the more flexible
technique; the second is stricter and entails the risk of a threshold effect, though the discretion
left to the European Public Prosecutor would reduce the risk.

Secondly, provision might be made for an exception from the mandatory prosecution
principle on the basis of the potential impact of the proceedings on the outcome of the case. In
particular, the European Public Prosecutor could be given the discretionary power to decide to
proceed against a given person only as regards a sufficient proportion of the charges brought
against him. This provision could be useful if the investigations already conducted into certain
of these charges appeared sufficient to obtain judgment and there are reasonable grounds for
believing that further investigation would not have the effect of significantly influencing the
outcome.

A third possible objective that an exception from the mandatory prosecution principle would
serve is the effectiveness of recovery of sums corresponding to the financial interests that are
violated. What is concerned here is the technique of the out-of-court settlement, familiar to
certain Member States and at least worth discussing. Here, if the accused has repaired the loss
caused, either by repaying the sums he should not have received (in agreement with the
authorising department) or by paying the taxes or duties he evaded, he may be given the
possibility of entering into an agreement with the European Public Prosecutor to terminate the
prosecution. The accused makes a voluntary payment, and no judgment is entered. This
possibility might be useful where the prospect of a conviction was small. But it is only really
acceptable for offences relating to modest amounts of money. The terms of the settlement
would generally have to be conceived in such a way as not to be a means of evading liability
or a source of unfairness.

Whatever the grounds for waiving prosecution, it could always be provided that there may be
no exception may be made in certain aggravating circumstances, as defined by reference to
national law.

If the European Public Prosecutor then decided not to prosecute, he would have to close the
case and, if the prosecution has already been launched, take a decision to drop it.112 He would
then send the file for information to the national enforcement authorities, leaving it to them to
decide whether such a case, in which prosecution is not mandatory at European level, is
nonetheless of interest at the national level for other types of offence (see below).113 Without
violating the ne bis in idem principle, this might be the case if the perpetrator is already
known to enforcement services for having committed other offences in the national context.

Question 5 Should the European Public Prosecutor be guided by the mandatory
prosecution principle, as proposed by the Commission, or by the discretionary prosecution
principle? What exceptions should be provided for in each of these cases?

112

113

Cf. point 6.2.4.1 (closure).
This provision of information by the European Public Prosecutor should be distinguished from referrals to
the national prosecution authorities where Community cases are to be shared. Cf. point 6.2.2.2(a).

46

6.2.2.2. Distribution of cases between the European Public Prosecutor and the national
prosecution authorities

The areas of material jurisdiction of each being demarcated, there is then a need to carefully
organise the practical distribution of cases between the European Public Prosecutor and the
national prosecution authorities. For the sake of consistency, to limit the cases where the same
conduct
to limit
is prosecuted more than once. For the sake of savings in resources,
duplication. Out of a concern for justice, to avoid any violation of the “ne bis in idem”
principle and to exclude the risk of negative conflicts of jurisdiction, where nobody asserts
jurisdiction to prosecute. Settling this question would also facilitate the subsequent decision
who is to present the prosecution case in the trial court.

a) Community cases

The principle of the European Public Prosecutor is that he is the person with jurisdiction over
offences defined as such for the protection of the Community’s financial interests. That leaves
the question to what extent this material jurisdiction should have the effect of allocating cases
to the European Public Prosecutor on an exclusive basis or shared with the national
enforcement authorities.

Rather than exclusive powers, it would be preferable to recognise two principles to enable the
European Public Prosecutor to perform his role: systematic referral to him, and his primacy.
First of all, as seen above, referral to him should be systematic wherever there are factors
linking an offence with the Community’s financial interests. Second, the referral to him
should in all logic take the case out of the national authorities’ hands if the ”ne bis in idem”
rule is applied at the investigation stage.

Subject to these two principles – systematic referral to the European Public Prosecutor and his
primacy over the national authorities – the distribution of Community cases could be shared
between the European Public Prosecutor and the national prosecution authorities. Under the
subsidiarity principle, certain cases relating to the protection of the Community’s financial
interests could be left in the hands of the national authorities.

– by applying a threshold set by the legislation, expressed for example as an amount
concerned by the offence, the European Public Prosecutor being informed even so, in order
to give him a full picture of the relevant forms of crime;

– on the basis of a power conferred on the European Public Prosecutor to refer cases to the

national enforcement authorities;

– this power would be modulable in practice within the limits of guidelines providing, for
example, for referral as the general rule where a case concerns the territory of only one
Member State;

– in any case as the consequence of one of the exceptions from the mandatory prosecution

principle mentioned above, except where there is a settlement.

47

a) Hybrid cases

The position is different as regards hybrid cases involving both a Community offence and a
national offence. How will cases which call for action on the part of the European Public
Prosecutor but which extend beyond his jurisdiction be dealt with?

Hybrid cases are common in practice, as most European funds are collected and managed by
national authorities.

There are many examples of hybrid cases, such as the diversion of Community grants via
corruption of a national civil servant, or smuggling goods and thereby evading both excise
duties (national revenue), VAT and customs duties (own resources).

The simplest case is where the offences and therefore the prosecutions can be dealt with
separately. The European Public Prosecutor, receiving in formation or a referral, would
prosecute only the Community offence,
leaving the rest of the case for the national
enforcement authorities.

But there are also genuinely hybrid cases where the component facts are more complex. Two
situations can be distinguished: a) the same conduct constitutes two offences, one of them a
national offence and the other a Community offence, concerning the same interest to be
protected; b) two connected forms of conduct (distinct but closely bound up) correspond to
two offences, one of them a national offence and the other a Community offence. In both
cases, the concentration of prosecutions can be operationally useful.

Hybrid cases cannot be handled by a national enforcement authority on its own, as the
function of the European Public Prosecutor would then be devoid of substance. The
establishment of Deputy European Public Prosecutors, especially if they combined national
with European functions, should make it easier to handle such cases. So would the
establishment of the Eurojust Unit, in areas where it is concerned.114 But it is still necessary to
limit the risks of conflict between national and Community policies on crime and between the
Community procedure applicable to Community offences and the national procedure
applicable to national offences.

c) Organising the dialogue between the European Public Prosecutor and the national
prosecution authorities

To settle the foregoing question, but also for more general reasons, a mechanism must be
organised for consultations between the European Public Prosecutor and the national
prosecution authorities, which on the basis of practical experience would gradually
consolidate relations of mutual trust. Introducing an obligation to refer to the European Public
Prosecutor, incumbent notably on the national enforcement authorities, should provide the
basis for this dialogue.115 The dialogue between national and European prosecutors should be

114

115

Cf. point 7.2.1 (Eurojust).
See in particular Article 18(5) of the Corpus juris. Unlike the obligation for States to cooperate at the
investigation stage with the prosecutors at the more recent International Criminal Courts (Article 29 of
the Statute of the Court for former Yugoslavia; Article 28 of the Statute of the Court for Rwanda; Article
93 of the Statute of the ICC), assistance here would be provided direct between the European Public
Prosecutor and the national enforcement authorities.

48

subject to the principle of full respect for certainty as to the law. The Deputy European Public
Prosecutors would at all events have access to records of prior convictions.116

Given the obligation to refer cases to the European Public Prosecutor wherever
the
Community’s financial interests are involved, the European Public Prosecutor would decide
in appropriate cases to refer to the national authorities offences which affect “principally”
national interests.117 To specify what “principally” means, the Community legislation could
establish a more detailed definition and the European Public Prosecutor could issue
guidelines. These should reflect the principles of the primacy of Community law over national
law and the primacy of the lex specialis over the lex generalis.

On the other hand, in cases where the European Public Prosecutor did not refer a hybrid case
to the national authorities, he could have recourse to a joint prosecutions scheme, involving
the Deputy European Public Prosecutor and the national enforcement authorities,
the
European Public Prosecutor playing the lead role.

In all cases, if one of the two levels – national or Community – refers a hybrid case in its
entirety to the other, the latter should conduct the prosecution in such a way as to have regard
for the interests of the former.

Ultimately, if different courts were hearing cases in parallel, there should be a procedure for
settling conflicts of jurisdiction in the Court of Justice, as considered below.118

Question 6 Given the ideas put forward in this Green Paper, how should functions be
distributed between the European Public Prosecutor and the national enforcement
authorities, notably in order to see that hybrid cases are properly treated?

6.2.3. Conducting investigations

6.2.3.1. Investigation measures

The European Public Prosecutor would be responsible for directing and coordinating
investigations in his own areas of competence. By virtue of the presumption of innocence, the
prosecutor would have to prove that the accused is guilty, examining the evidence for and
against. Having jurisdiction over offences that can be quite serious, it would be right to give
him access where necessary to the entire range of investigation measures available in the
national system to combat this form of financial crime.119

He might, for instance, subject to a court warrant where fundamental rights are potentially at
stake, gather or seize any useful information, hear witnesses and question suspects, subpoena
suspects, conduct searches and seizures, including of correspondence, freeze assets, order
investigation
phone taps or other high-tech communication interceptions, use special
techniques that are useful in financial cases and recognised by Convention-based law120

116

117

118

119

120

See Title VI (Register of fraud prosecutions) of the Commission draft laid before the Council for the
adoption of the Protocol of 19.6.1997 to the Convention of 26.7.1995 (OJ C 83, 20.3.1996, p. 10).
See in particular Article 19 of the Corpus juris, Florence version.
See in particular Article 28(1) of the Corpus juris and Chapter 8 (judicial review) below.
In this Green Paper, “investigation measure” refers to a general category of individual acts of
investigation.
Convention of 18.12.1997 on mutual assistance and customs cooperation between customs
administrations (Naples II); Convention of 29.5.2000 on mutual judicial assistance in criminal matters
between the Member States of the European Union (OJ C 197, 12.7.2000, p. 1).

49

(covert investigations, controlled deliveries), request the issuance of arrest warrants, probation
orders or custody orders.

This Green Paper is to provide an opportunity to think in greater depth than hitherto about the
judicial guarantee at the preparatory stage and on the relevant level – national or Community
– at which such measures should be managed and controlled.

The European Public Prosecutor could not operate if he had access to coercive measures
defined solely at national level without any mutual recognition. The effect would be that no
change was made to the situation involving international letters rogatory and extradition. The
common investigation and prosecution area would be substantially devoid of substance.

But, on the other hand, there can be no question of codifying the criminal law in Europe, as
that would be out of proportion to the objective. The point is simply to make it easier to
prosecute offences affecting the Community’s financial
to set up a
fully-fledged European judicial system.

interests and not

Mutual recognition of national coercive measures could suffice for the operation of the
European Public Prosecutor provided there is an adequate set of common principles in the
Member States. In this respect, apart from the fact that the Member States are subject to
respect for fundamental rights, the instruments adopted or in preparation under the third pillar
(freezing of assets,121 temporary transfer of persons in custody for questioning, questioning by
videoconference or teleconference, controlled deliveries, telecommunications interception,122
European arrest warrant,123) suggest that the common core of principles is in the process of
consolidation, though it is too early to say just what it will consist of.

Automatic mutual recognition by the Member States of coercive measures implemented by
the European Public Prosecutor subject to review by the national judge of freedoms would
make it possible to escape the limitations of international letters rogatory and extradition, as
the coercive measures would then be valid throughout the Communities in a common area.

To be precise, as regards the national investigation measures available to the European Public
Prosecutor [see (b) and (c) above], mutual recognition would mean that, in the event of
execution in a Member State of an investigation measure authorised by a court in another
Member State, the European Public Prosecutor would not have to seek a fresh authorisation.

This can be illustrated by the example of searches to be conducted at three subsidiaries of
the same firm, based in three Member States, A, B and C. (The assumption is that under the
relevant national systems of law, searches of business premises require authorisation
(warrant) by the courts in States A and B but not in State C.) The European Public
Prosecutor could apply for a search warrant to the judge of freedoms in Member State A
and then use it in Member State B without applying for a second warrant and then proceed
to simultaneous searches in A, B and C.

The idea of mutual admissibility would also operate in relation to evidence gathered as a
result of such investigation measures, as will be seen below.124

121

122

123

124

Initiative by the Governments of the French Republic, the Kingdom of Sweden and the Kingdom of
Belgium for the adoption by the Council of a Framework Decision on the execution in the European
Union of orders freezing assets or evidence (OJ C 75, 7.3.2001, p. 3.).
Convention of 29.5.2000.
COM(2001) 522.
Cf. point 6.3.4 (evidence).

50

But Community investigation measures, i.e. acts of the European Public Prosecutor [described
under (a)] and therefore by definition Community acts, would have the same legal status
throughout the common investigation and prosecution area.

a) Community investigation measures at
collecting or seizing information, hearing or questioning persons, etc.

the European Public Prosecutor’s discretion:

The European Public Prosecutor’s investigation measures involve no coercive power: copying
or seizing information, hearing witnesses or questioning the accused with his consent. They
should therefore be within his discretion. The question further arises whether visits to firms
should be included, as a warrant is not required by the law of all the Member States.

these measures should be subject

to a precise procedure laid down by
In any event,
Community law. Defence rights should be fully secured. The rights of the accused here could
be inspired by the provisions laid down in the statutes of the most
recently-created
international criminal courts to protect the accused: assistance of a legal adviser, translation,
right to silence, right to plead not guilty, prior information on rights (use of his statements as
evidence, notification of charges against him, etc.).

b) Investigation measures subject to review by the courts: subpoenas, house searches,
seizures, freezing of assets, interception of communications, covert investigations, controlled
or supervised deliveries, etc.

The European Public Prosecutor should also be able to use coercive measures that are valid
and executable throughout the Community investigation and prosecution area. But
they
should be subject to review by the national courts.125 They would then be executed under the
direction of the European Public Prosecutor by the appropriate authorities.126

The applicable national law at the warrant stage would be that of the Member State of the
forum, and at the execution stage it would be that of the Member State of the place for
execution of the investigation measure, assuming that this is a different Member State. On this
basis, the warrant and the execution should be mutually recognised and evidence should be
mutually admissible as between the Member States.

It will be necessary to check in advance whether the domestic law of each Member State
provides for the same coercive measures. Mutual recognition presupposes a minimum degree
of harmony between national provisions relating to investigation measures. The idea is not to
harmonise national rules here but to check whether at least there are national rules in each
Member State to provide a basis for the investigation measures the European Public
Prosecutor wishes to take. For example, if Community law is to provide legitimately for the
European Public Prosecutor to have the power to intercept communications, there must be
national legislation providing for this in each of the Member States.

National law would also be the basis for the decision as to the terms of the warrant issued by
the judge of freedoms (prior or post facto authorisation, normal or emergency procedure, etc.).
The principle of mutual recognition would apply to the forms but not to the principle of
review by the national judge of freedoms.

125

126

See point 6.4 (guarantee of the involvement of a court).
Cf. point 6.2.3.2 (working relations with national investigation services) and point 7.3. (future role of
OLAF).

51

In the previous example, the warrant issued by the court in Member State A may have been
issued by a summary procedure that does not exist in Member State B but is recognised
there under the mutual recognition principle. But the European Public Prosecutor could not
simply do without a warrant in both Member States A and B on the sole ground that
Member State C authorises searches of business premises without a warrant from the
courts.

c) Investigation measures ordered by the judge of
European Public Prosecutor: arrest warrant, probation order or custody order

freedoms on application from the

The points made in the example above apply a fortiori to investigation measures that restrict
or remove the accused’s liberty. But these measures, unlike the previous ones, would take the
form of orders made not by the European Public Prosecutor but by the national judge of
freedoms, given their seriousness.

To obtain an arrest warrant, probation order or custody order, the European Public Prosecutor
would have to apply to a court.

In particular, the Commission considers that the European Public Prosecutor should be able to
apply to any relevant national judicial authority for the issuance of an arrest warrant in
accordance, mutatis mutandis, with the Commission proposal for a framework decision on the
European arrest warrant.127

This warrant would be executable throughout the common investigation and prosecution area
and would enable the European Public Prosecutor to apply for an identified person to be
sought, arrested and surrendered on the basis of a suspected offence. Every European arrest
warrant would be listed in the Schengen Information System (SIS). To protect his rights, the
person arrested could oppose the execution of the warrant in the courts of the Member State
of execution.

The European arrest warrant would render the extradition procedure superfluous in the areas
within the European Public Prosecutor’s jurisdiction. In particular, the principles of double
jeopardy and the ban on extraditing nationals would as a matter of principle cease to operate
in this context. This follows on from the Tampere conclusions, which aim to reduce the
frequency of extradition requests and to develop a European enforcement order.128

Question 7 Does the proposed list of investigation measures for the European Public
Prosecutor seem to you to be adequate, particularly as a means of overcoming the
fragmentation of the European criminal-law area? What framework (applicable law,
review - see point 6.4) should be envisaged for investigation measures?

6.2.3.2. Working relations with national investigation services

The proposal to establish a European Public Prosecutor does not involve establishing a
Community law officer to conduct all investigation measure in the Member States.129 The
European Public Prosecutor should be able to call on the national investigation, police and

127

128

129

COM(2001) 522.
Conclusions, points 35 and 37.
Cf. point 7.3 as regards the more specific question of investigation measures within the Community
institutions.

52

judicial services, possibly organised as joint investigation teams,130 to execute measures taken
or authorised by a court.131

There are several possible bases for the working relations.

In the first option, the European Public Prosecutor would enjoy a direct investigation power
for the purposes of discharging his functions in relation to the Member States’ investigation
services.

A second option would be to provide in more general terms for an obligation for the Member
States’services to assist the European Public Prosecutor. The European Public Prosecutor
would be entitled to ask for the assistance of the police in the relevant Member States to
undertake a search, and the police would not be entitled to refuse.

A third option would be to comply in each Member States with the system of relations
between national prosecuting authorities and national investigation authorities.

By way of illustration, in this last hypothesis, the Deputy European Public Prosecutor in
Member State A could ask direct for the assistance of the police like that Member State’s
own prosecution service, whereas in Member State B, where the national prosecution
authorities have no powers to order police investigations, the European Public Prosecutor
could make only suggestions to them.

The Commission’s preference is for this third solution, provided the freedom of internal
organisation it allows does not jeopardise the Community principles of effectiveness and
equivalence. In this case the Deputy European Public Prosecutors would have the same
powers in relation to the national investigation services as the national prosecution authorities.

Question 8 What solutions should be envisaged to ensure the execution of investigation
measures undertaken by the European Public Prosecutor?

6.2.4. Outcome of prosecution

6.2.4.1. Case closed or not pursued

If he waives the prosecution, the European Public Prosecutor should take a formal decision to
close the case or refrain from prosecuting. In all cases, this should be possible at any time
during the preparatory stage. There may also be cause for abandoning the prosecution, beyond
the prosecutor’s control, at any time, including during the preparatory stage.132

It is not necessary to return to the situation where the European Public Prosecutor decides on
a discretionary basis that the case should be dropped under one of the exceptions from the

130

131

132

Article 13 of the Convention of 29.5.2000 on mutual judicial assistance in criminal matters.
Although this is not the point of this Green Paper, it should be pointed out that in certain cases, strictly
limited by the subsidiarity principle , the existence of investigation powers exercised at European level
could help boost
the effectiveness of the European Public Prosecutor. In particular this affects
transnational cases concerning direct expenditure (managed by the Communities, the administrative
departments of the Member States not being involved), for example where the Commission’s contractors
or subcontractors are in several Member States. See also point 7.3 (future role of OLAF).
Cf. point 6.3.5 (causes for abandoning prosecutions at the trial stage).

53

mandatory prosecution principle mentioned above,133 which may arise without
prosecution actually having been launched.

the

The European Public Prosecutor may also be minded to take a closure decision in the course
of a prosecution he has already launched.

– This would become mandatory where there was any cause for abandoning the prosecution:
the limitation period has expired,134 the accused disappears or dies or a general national
measure such as an amnesty or pardon is taken.

– It should also be provided that a case may be dropped in a number of specified situations –
remains

the evidence is lacking or

the perpetrator

the offence is not completed,
unidentified.

The form of the decision should be determined by a Community procedure. Provision could
be made for an obligation on the European Public Prosecutor to give reasons for his decision.
It would be served on the accused, the victim – meaning the Commission as representing the
Communities – and the national prosecution authorities in the context of the dialogue
mentioned earlier.

As has been seen, where the “ne bis in idem” principle allows, the discretionary closure of a
case by the European Public Prosecutor would not have the effect of preventing the national
prosecution authorities from prosecuting for national offences.135 This raises the question of
the effect on those authorities of the European Public Prosecutor’s decision to drop a
prosecution at the end of the road. It might be logical enough to provide that where new
evidence emerges the national authorities must inform the European Public Prosecutor.

6.2.4.2. Committal for trial

Alternatively, on completion of the investigation, the European Public Prosecutor could take a
decision to commit for trial. For that purpose, having acted impartially and diligently, he
the accused has
should have acquired sufficient evidence to support an allegation that
committed an offence within his jurisdiction. Having regard to the charges laid, conviction
should now be more probable than acquittal.

As for the forms of the committal, the relevant Deputy European Public Prosecutor should
operate in accordance with the national criminal procedure. Generally, in criminal systems, a
bill of indictment states the accused’s identity, the alleged facts and the charges against
him.136 The form, the content and the review of the bill by the courts would be governed
exclusively by national law.137 So would the whole of the trial stage.

Question 9 On what terms should the European Public Prosecutor be able to take a
decision to close a case or commit it for trial?

133

134

135

136

137

Cf. point 6.2.2.1 (obligation or discretion to prosecute).
Cf. point 5.5 (limitation).
Cf. point 6.2.2.2 (b) and (c) (distribution of cases between the European Public Prosecutor and the
national prosecution authorities).
See, for example, Article 58(3) of the Statute of the International Criminal Court.
Cf. point 6.4 (court reviewing committal proceedings).

54

6.3.

Trial stage

Under Article 280a of the EC Treaty as proposed by the Commission, the European Public
Prosecutor would be ”responsible for ... exercising the functions of prosecutor in the national
courts of the Member States in relation to such offences [against the Community’s financial
interests] in accordance with the rules provided for by” the relevant Community
legislation.138

6.3.1. Choice of Member State of trial

In complex cases involving several Member States, the European Public Prosecutor should
determine the Member State in which the case is to be committed for trial.

Even when the Convention of 25 July 1995 and its Protocols have been ratified,139 jurisdiction
to try the same offence against the Community’s financial interests could still be claimed by
several Member States at once. The criteria for jurisdiction adopted by the Union Member
States in the context of the third pillar aim chiefly to ensure that there is at least one Member
States that has jurisdiction to try the offences defined. 140 But these criteria do not necessarily
determine a single Member State that the European Public Prosecutor would see as the
obvious State for the trial.

The logical sequel of the principle of centralised management of prosecutions is that the
European Public Prosecutor should choose one of the Member States that have jurisdiction
under the convention-based instruments as the one in which the case would be sent for trial.
This would avoid the risk of positive conflicts of jurisdiction, where several Member States
conduct their own trials. The European Public Prosecutor should be able to concentrate the
committals for trial on a single Member State. He should also be able to sever the prosecution
so as to send different components of a complex case for trial in as many different Member
States as may be necessary. It should be possible to combine the two options.

But the choice of the Member State in which a case is sent for trial is not a neutral one in a
partly harmonised law-enforcement area, since that choice determines not only the language
or languages that will be used, the practicalities (witnesses, transport etc.) and the court that
has jurisdiction but also the applicable national law in matters not within the common set of
rules. Consequently there are two essential questions – the criteria for and the review of the
choice of Member State.

The choice should be based on certain criteria, while leaving the European Public Prosecutor
with some room for manoeuvre to take account of the needs of the individual case. These
criteria, which should be laid down in the Community legislation, might be the place where
the offence was committed, the accused’s nationality or place of residence (natural persons)
or of headquarters (legal persons), the place where the evidence is to be found or the place
where the accused is held. In any event, the choice of a national court at the preparatory stage
should not predetermine the Member State of trial.141

138

139

140

141

See Annex 2, third procedure.
The proposal for a directive of 23.5.2001 does not take over those provisions of the Convention and its
Protocols which are covered by the exception provided for by Article 280(4) of the EC Treaty relating to
the application of national criminal law and the administration of justice in the Member States. These
provisions will enter into force only after ratification by all the Member States.
Article 4 of the Convention of 25.7.1995 and Article 6 of the Protocol of 27.9.1996.
See point 6.4 (freedom secured by the courts).

55

The criteria should be weighted, as one and the same criterion might point to several places.
Rather than being ranked on a hierarchical basis, they should be combined as a set of
concordant items of evidence. The court chosen ought on principle to be related to the offence
committed, but the European Public Prosecutor ought to enjoy flexibility to choose the forum
that appears most appropriate for the proper administration of justice.142

On the question of the review of the choice of Member State of trial, a possible first option
might be to leave the European Public Prosecutor wholly responsible for the choice. The
principle of mutual recognition in the European Union is now based on trust in all the national
legal systems. They are based on a solid set of common principles, among which are not only
the “non bis in idem” rule, applied here to the trial and judgment stage, but also the principles
that offences and penalties must be defined by law, on a non-retroactive basis, and the
penalties must be in proportion to the offence.143

The foundations of adversarial court procedure are accepted by all Member States. The rights
to redress and to access to an independent and impartial tribunal established by law are
recognised.144
In addition to the fundamental rights mentioned above as regards the
preparatory stage, there are at the trial stage the principles of the benefit of the doubt and of
the degree of certainty – evidence beyond all reasonable doubt – needed for a conviction.

The rights of the accused, the victims and the witnesses are guaranteed in all national systems:
In particular there is the right to remain silent to avoid self-incrimination145 and the right to be
advised, defended and represented.146

But certain arguments might militate in favour of a review of the choice of Member State of
trial. If the general criminal law is not harmonised and the European Public Prosecutor enjoys
the discretionary margin he needs, the Prosecutor should not be able to select a court on an
unfair basis, for instance regularly avoiding sending cases for trial in Member States where
the judicial system seems less promising to him. If it was felt useful to review the choice of
forum, this would have to be a judicial review.

The second option consists of reviewing the European Public Prosecutor’s choice of Member
State of trial and entrusting the review function to a national court. The court reviewing the
accusation would obviously review its legality, notably in terms of jurisdiction, by reference
to national law. The question arises whether the review should be extended to manifest errors
in the choice of Member State in terms of Community law (criteria mentioned above). Even
without giving the national court the power to rule against the European Public Prosecutor’s
discretionary choice of forum, review of abuse or manifest error raises the possibility that one
or more Member State might decline the same case in whole or in part. The jurisdiction
criteria of the Convention of 25 July 1995 ought theoretically to make this kind of situation
impossible. But in practice this second option does suggest that there could be a few cases of

142

143

144

145

146

The concept of the proper administration of justice embraces the principles of a reasonable period of time,
fairness and effectiveness.
Article 49 of the Charter of Fundamental Rights of the European Union and Article 7 of the European
Convention for the Protection of Human Rights and Fundamental Freedoms.
Article 47(1) and (2) of the Charter and Article 6(1) of the Convention.
In particular, the right against self-incrimination presupposes that the European Public Prosecutor will not
use any evidence obtained under duress or constraint contrary to the accused’s own free will (ECHR,
Funke v France, 25.2.1993, paragraph 44). But the European Public Prosecutor would be able to use data
obtained form the accused by means of coercive powers but which exist irrespective of the suspect’s will
(ECHR, Saunders v United Kingdom, 17.12.1996, para 69).
Article 47(2) of the Charter and Article 6(3) of the Convention.

56

declined jurisdiction and possibly even of negative conflicts of jurisdiction. They should be
settled by a Community court, and as matters stand that can only mean the Court of Justice.147

There is also a third option of establishing a special Community court to review the European
Public Prosecutor’s choice of Member State of trial, but that goes far beyond the ambitions of
the Commission proposal. But to ensure that the debate is complete, the hypothesis is
considered below in conjunction with the question of reviewing the committal order itself.148

Question 10 By what criteria should the Member State or States of trial be chosen? Should
the European Public Prosecutor’s choice be subject to review? If so, by whom?

6.3.2. Exercise of the prosecution function

The European Prosecution Service would conduct prosecutions before the national courts and
in accordance with national law.

Just as it does not involve establishing a European court, the Commission proposal does not
presuppose the introduction of a specifically European prosecution. It is, moreover, perfectly
neutral on the organisation of trial courts. The complexity of cross-border financial cases
may, of course, raise doubts as to the ability of non-professional judges to try them.149 But the
Commission regards this as a question for the individual Member States in accordance with
the principle of subsidiarity.

The European Public Prosecutor, meaning in practice the Deputy European Public Prosecutor
in the Member State of trial, would prosecute in accordance with the national court
organisation and procedure. The sources of the law of criminal procedure are different from
one Member State to another, but the differences are a lot smaller at the trial stage than at the
preparatory stage.

The need for centralised management on grounds of effectiveness consequently does not
apply at the trial stage. National law would basically remain applicable, subject to minor
changes to provide for prosecution by the European Public Prosecutor in cases where the
Community’s financial interests are at stake.

6.3.3. The European Communities, victims in accordance with the ordinary law

The place of the victim in criminal proceedings varies sharply from one Member State to
another. Some of them allow partie civile proceedings for compensation for loss sustained,
and this procedure can go so far as to prompt the commencement of a prosecution at the
victim’s initiative. The advantage of the partie civile procedure is that there is no need for
subsequent civil proceedings. In other Member States the victim can give evidence as amicus
curiae at the trial.

In the system outlined here, criminal proceedings could be initiated only by the European
Public Prosecutor, but the Community might nevertheless have an interest in being a party to
the trial, given that the Prosecutor will be acting independently. There are several hypotheses
worth considering as regards the defence of the Community’s finances, such as partie civile

147

148

149

Cf. point 8 (judicial review).
Cf. point 6.4.3 (court reviewing committal proceedings).
See, for instance, Article 26(1) of the Corpus juris.

57

proceedings brought by the Commission on behalf of the European Communities, or an expert
or ordinary witness function for staff from OLAF or other departments.

The Commission does not accept the hypothesis of a uniform role for the Communities as
victim in all cases involving the Community’s financial interests. What it would simply like is
for the Communities to be sure of enjoying the same rights as an ordinary victim in all the
Member States.

6.3.4. Law of evidence

The fact
that evidence gathered in one Member State is not automatically recognised
throughout the Union is all too often an obstacle to effective prosecution in transnational
cases. This situation makes it more difficult to make use of the findings of investigations
when a case comes to criminal trial. Preserving it would ruin all efforts made to centralise the
management of prosecutions with the establishment of the European Public Prosecutor. The
effectiveness of the European Public Prosecutor, measured by the possibility of using at trial
the evidence gathered by him, depends on this difficulty being overcome.

6.3.4.1. Admissibility of evidence

A simple reference to national law is by definition incapable of settling the question of the
admissibility of evidence in a European investigation and prosecution area. It must be
possible for evidence gathered in one Member State to be admitted in the courts of any other
Union Member State so that prosecutions can be concentrated in the Member State where it
has been decided to send the case for trial. The rules of evidence, being based on a set of
comparable principles, are still too different in matters of detail for the European Public
Prosecutor to be able to take them as a basis.

The European Public Prosecutor would also have the regrettable duty to choose between an
abusive form of forum shopping (concentrating committals for trial in the Member State or
States offering the greatest flexibility in the rules of evidence) and impunity and iniquity in
prosecutions (ineffectiveness of a large number of prosecutions on account of variations in the
rules of evidence).

The impasse here cannot reasonably warrant the Community unification of the rules of
evidence. This hypothesis, which would be tantamount to general codification of criminal law
in Europe, would be right out of proportion to the specific objective, which is solely to seek
effectiveness in proceedings against certain basically common interests. There would be a
danger of complexity if two systems of evidence were to coexist, one operating in
Community matters and one in domestic matters.

Neither unification in the form of a complete code on the admissibility of evidence, nor a
simple reference to national law but mutual admissibility of evidence is the most realistic and
satisfactory solution here. Under this principle, any national court trying a criminal case in
which the Community’s financial interests were at stake would have to admit any evidence
lawfully obtained in accordance with the law of another Member State. Under the idea of
mutual admissibility of evidence posited by the Tampere European Council, “evidence
lawfully gathered by one Member State’s authorities should be admissible before the courts of
other Member States”.150

150

Tampere Conclusions, point 36.

58

In addition, it would be worth evaluating whether there is a need for a European record of
questioning to serve as a model for the European Public Prosecutor where he questions
witnesses himself without going through the national investigation authorities. To respect the
rights of the accused, Community law should provide for the European Public Prosecutor to
have the possibility of applying specific procedures reflecting cross-border situations:
European record of questioning of witnesses on the basis of testimony given, and European
record of questioning of the accused, including videoconferences in both cases.151

6.3.4.2. Exclusion of evidence unlawfully obtained

The prior condition for any mutual admissibility of evidence is that the evidence must have
been obtained lawfully in the Member State where it is found. The question of the exclusion
of evidence obtained contrary to the law therefore has to be considered.

The law that must be respected if evidence is not to be excluded is first and foremost the
national law of the place where the evidence is situated, which integrates in all Member States
the principles of Article 6 of the Union Treaty, the Charter of Fundamental Rights of the
European Union and the European Convention for the Protection of Human Rights and
Fundamental Freedoms. It would include certain Community rules such as those governing
the European arrest warrant or record of questioning where they are used as evidence.

The Commission would prefer the exclusion decision to be taken by the court review with
jurisdiction to the committal (whoever that may be in the relevant Member State).152 The rules
governing exclusion would be those of the Member State in which the evidence was obtained.
The effect of this would be that any national court having jurisdiction in cases involving the
criminal protection of the Community’s financial interests would have to be familiar with the
rules of evidence in the other Member States. This is a common situation in private
law. The practical difficulties here should be cleared up by progress in
international
facilitating networking among the Member States’ judicial systems (liaison judges, European
Judicial Network).

Likewise, where evidence obtained in the course of a Community administrative procedure is
to be used in a criminal trial, this should be conditional on compliance – right from the
administrative stage if there are grounds for believing that there is a link to a criminal offence
– with the constraints of criminal procedure (defence rights). Evidence gathered in the course
of an internal administrative enquiry (within the Community institutions) could be made
admissible on a mandatory basis in the national courts if it has been gathered without any
human rights violations.153

As for the validity of evidence (its credibility in the eyes of the court), this will obviously be
within the discretion of the courts themselves, on the basis of the applicable national law.

Question 11 Do you think that the principle that evidence lawfully obtained in a Member
State should be admissible in the courts of all other Member States is such as to enable the
European Public Prosecutor to overcome the barrier raised by the diversity of rules of
evidence?

151

152

153

See in particular Article 32 of the Corpus juris.
Cf. point 6.4.3 (court reviewing committal proceedings).
For example, the obligation on Community staff to cooperate with OLAF in its internal administrative
investigations must be interpreted as raising no barriers to the fundamental right, already mentioned,
against self-incrimination (ECHR, Saunders, supra).

59

6.3.5. Factors causing early termination of prosecution

Unless the European Public Prosecutor decides to close a case without further action,154 the
prosecution brought will as a general rule end with a conviction or an acquittal.

But during the trial the prosecution can always be terminated for the reasons considered
already in relation to the preparatory stage. For instance, the limitation period may expire.155
The accused may die (if he is a natural person) or be dissolved (if it is a legal person). There
may be national measure that precludes further prosecutions, such as an amnesty or a pardon.
In general terms, the grounds for terminating the prosecution at the trial stage would be
determined by the national law applicable to the trial.

6.3.6.

Execution of the judgment

The Commission does not envisage giving the European Public Prosecutor a role to play in
the execution of the judgment given on the merits, unlike the approach generally taken in the
Member States.156 The reference to national law on this point should be facilitated by the
progress made since Tampere.

6.4.

Guarantee of the involvement of a court

Since acts done by the European Public Prosecutor have an impact on fundamental human
rights, they should be subject to review by the courts, whose role should be specified. The
Commission has proposed providing in the EC Treaty that the Community legislation should
lay down “the general conditions governing the performance of the functions of the European
Public Prosecutor and ... in particular … (c) rules applicable to the judicial review of
procedural measures taken by the European Public Prosecutor in the exercise of his
functions.”

6.4.1.

Functions of the court

In general terms, any court with jurisdiction to review acts done by the European Public
Prosecutor should offer all the assurances expected from a court. It should be competent,
independent and impartial in accordance with the general principles recognised by all the
Member States.157

The role of the court reviewing acts done by the European Public Prosecutor would be to
provide the guarantee of judicial intervention. There are two distinct functions here:

– during the preparatory stage, the court reviewing coercive acts, known here as the judge of
freedoms, issues or authorises, after reviewing them for legality and proportionality, those
measures taken by the European Public Prosecutor involving a restriction of fundamental
rights (see question in point 6.4.2);

– at the end of the preparatory phase, acting on the basis of the European Public Prosecutor’s
decision to commit the case to trial, the court confirms the charges on the basis of which
the European Public Prosecutor intends to proceed and the validity of the committal to the

154

155

156

157

Cf. point 6.2.4.1 (withdrawal of prosecution).
Cf. point 5.5 (limitation).
The alternative option is taken by Article 23 of the Corpus juris.
Article 47 of the Charter of Fundamental Rights of the EU; Article 6(1) of the European Convention for
the Protection of Human Rights and Fundamental Freedoms.

60

trial court. The aim is to consider whether the evidence is sufficient and admissible and a
proper procedure has been followed so as to avoid a flawed trial and the risk of
stigmatisation of the accused (see point 6.4.3.).

6.4.2.

The designation of the judge of freedoms

In institutional terms it is theoretically conceivable that the establishment of the European
Public Prosecutor might be accompanied by the establishment of a Community judge of
freedoms. But in what legal system, if not in the Community system? This solution would
effectively generate an obligation to enact a full body of common European legislation
governing investigations, applying to searches, seizures, interceptions of communications,
subpoenas, arrest, judicial review, preventive custody etc. That is not the Commission’s
preference.

The judge of freedoms could very well be in the national system.158 There is no need to
establish a European indictments court. The Member States remain entirely free to determine
the number of such courts and the way they are organised. They might, for instance, be
designated in each Member State from among courts sitting in the places where the Deputy
European Public Prosecutors are based. In accordance with the case law of the European
Court of Human Rights, its functions should be made incompatible with those of the trial
court.159

From a functional point of view, the competent court would be the court the Member State to
which the relevant Deputy European Public Prosecutor belongs. Several national courts may
therefore be involved in the same case where action by the European Public Prosecutor in
several Member States is involved.

There are three options. The first is that the European Public Prosecutor should apply to the
judge of freedoms in the Member State in which he wishes to undertake some act of
investigation.

The second is that the European Public Prosecutor could apply to only one judge of freedoms,
who would issue or authorise all the acts needed for the investigation, executable throughout
the Communities on the basis of the mutual recognition principle.

The third would be to leave the European Public Prosecutor free, within the limits set by the
legislation, to combine these two possibilities. Where the European Public Prosecutor is to
apply for the issuance or authorisation of acts whose place of execution is known in advance,
he would have to apply to the national judge of freedoms in the Member State where
execution is to take place. On the other hand, as regards acts whose place of execution is not
determined in advance, the European Public Prosecutor could choose to concentrate his
applications on a single national judge of freedoms, which would take a decision recognised
throughout the Communities.

Take the example of a case in which the European Public Prosecutor needs to search the
accused’s car and home in Member State A and to intercept certain calls made from a
mobile telephone. He could apply to the court for Member State A for authorisation of all
these measures and search the premises in Member State A. On the basis of the same

158

159

Subject to compliance with the provisions of Article 234 EC and the judgement of the Court of Justice in
Foto-Frost (Case C-314/85 [1987] ECR 4199.
See, inter alia, judgments of the ECHR of 24 May 1989 in Hauschildt v Denmark, Series A, No 54, and
of 24 August 1993 in Nortier v Netherlands, Series A, No 267.

61

authorisation, mutually recognised, he could then search the accused’s vehicle and intercept
his telephone calls even though he has now travelled to Member State B.

The Commission’s preference is for one or other of the last
two options. They alone
correspond to the principle of establishing a common investigation and prosecution area. For
the sake of investigative efficiency, decisions by the review courts in all Member State should
be recognised throughout that area. The mutual recognition principle applies to the operation
of the national court. To ensure that the European Public Prosecutor’s acts of investigation
have territorial effect throughout Europe, acts issued or authorised by the national courts
should be enforceable everywhere in the Community.

Once again, mutual recognition is possible because of the common core of legal principles in
the Member States. The investigation measures envisaged here are provided for by the law of
criminal procedure in all the Member States. They are always subject to compliance with the
principles recognised by the Charter of Fundamental Rights of the European Union and the
European Convention for the Protection of Human Rights and Fundamental Freedoms. The
juxtaposition of national legal systems is therefore no obstacle to mutual recognition of
decisions by national courts.

International
letters rogatory will no longer serve any purpose in cases involving the
protection of the Community’s financial interests. European law would do no more than
extend the validity of decisions by the national courts throughout the Union. For the rest,
domestic law would govern the procedure for issuing and reviewing decisions.

By way of example, if a search is to be made in Member State A under a warrant issued by
a court in Member State B, it cannot be refused, but it must be conducted in accordance
with the law of Member State A.

Question 12 To whom should the function of reviewing acts of investigation executed under
the authority of the European Public Prosecutor be entrusted?

6.4.3. Designation of the court to review the committal

Several options as to the court to review the committal are conceivable in institutional terms.
There are actually two basic possibilities, depending whether the court is to be European or
national.

The first possibility for organising the committal review function is to establish a European
Pre-Trial Chamber. This possibility was already considered above in relation to the review of
the choice of Member State.160 This solution might echo some of the mechanisms adopted by
various international criminal bodies (the Pre-Trial Judge of the International Criminal
Tribunal for the former Yugoslavia161 and even more so the Pre-Trial Chamber of the future
International Criminal Court162).

The Chamber would have jurisdiction to review the European Public Prosecutor’s decision to
send a case for trial. The European Pre-Trial Chamber’s review could relate not only to the
choice of forum but also to the adequacy of the evidence. It could take up cases of its own
motion or on application from the accused.

160

161

162

Cf. point 6.3.1 (choice of State of trial).
Article 65 ter of the Rules of Procedure and Evidence of the ICTY of 11 February 1994, as amended on
10 July 1998.
Articles 56 et seq. of the Statute of the International Criminal Court.

62

The establishment of a Community committals court, possibly as a specialised chamber of the
Court of Justice, would have the advantage of placing the review of committals in the hands
of a single, specialised court and thus securing the unity of the relevant law and practice. But
the Treaty amendment needed to establish this chamber goes well beyond the Commission’s
contribution to the Intergovernmental Conference. So another solution must be considered.

The second possibility would be for the committal review function to be exercised by a
national court designated by each Member State for the purpose. This solution would not
entail establishing a new court. The type of court designated might vary very considerably
from one Member State to another. Depending on the Member State, the court exercising the
committal review function may be an ad hoc court or the trial court itself. This solution
respects the variety of judicial systems and allows all manner of courts to be designated as
committal review courts in the Member States.

The Commission’s preference is for the second possibility. Establishing a new Community
court should be avoided, provided there is an arrangement for the Court of Justice to settle
conflicts of jurisdiction, which ought to be rare in practice. In any event, provision should be
made for flexibility in the choice of committal review court, which should be in a different
Member State from the original committal court.

In functional terms the European Public Prosecutor would apply to the committal review
court in the Member State in which he is minded to send the case to trial. His choice must
correspond to the Community criteria discussed above for the choice of Member State of trial,
amplified as appropriate by the applicable national law, subject to a posteriori review by the
Court of Justice.163

Question 13 To whom should the committal review function be entrusted?

***

Question 14 Do you feel that fundamental individual rights are adequately protected
throughout the proposed procedure for the European Public Prosecutor? In particular, is
the double jeopardy principle properly secured (see point 6.2.1)?

163

Cf. point 8 (judicial review).

63

7.

RELATIONS WITH THE OTHER PARTIES INVOLVED

Inserting the European Public Prosecutor into the existing institutional context must be
handled with care, especially in view of current developments in the European Union.

7.1.

Cooperation with Member States’ authorities

The establishment if the European Public Prosecutor would cause no upheavals in national
investigation and prosecution systems. It should be remembered that the following functions
would remain purely national:

– criminal investigation police forces;

– judicial review functions (judge of freedoms and committal review court);

– the administration of justice; and

– enforcement.

Consequently, above and beyond the distribution of jurisdiction considered here, there would
have to be permanent cooperation between the European Public Prosecutor and the authorities
of the Member States. Community secondary legislation would have to determine the nature
of the relationship between the European Public Prosecutor and the national police and
judicial authorities.

For one thing, the dialogue already mentioned between the European Public Prosecutor and
the national prosecution authorities would have to be organised, and practical input must be
provided, notably in the handling of hybrid cases,
to facilitate mutual consultations,
information exchange and assistance.164

For another, regarding the execution of acts of investigation issued or authorised by the
relevant national court, several options were set out above,165 the objective being that the
European Public Prosecutor can obtain the assistance of the national investigation authorities.

7.2.

Relations with those involved in cooperation in criminal matters in the
European Union

Since the powers of the European Public Prosecutor would be limited to the protection of the
Community’s financial interests, there should not be any difficulties in ensuring that his/her
functions, which are both more integrated and more specialised, complement those of the
bodies active in the area of cooperation on criminal matters. At this stage, given current
developments within the third pillar of the European Union, it is only possible to identify
possible food for thought. In particular, consideration should be given to developing a
balanced and coherent system with the following partners.

164

165

Cf. point 6.2.2.2 (allocation of cases).
Cf. point 6.2.3.2 (working relations with national investigation services).

64

7.2.1.

Eurojust

A European Judicial Cooperation Unit (Eurojust) should be set up shortly in the context of the
third pillar with the purpose of facilitating cooperation between Member States’ judicial
authorities and contributing to proper coordination of prosecutions in the area of serious, and
in particular organised, crime. The establishment of Eurojust
is provided for by the
conclusions of the Tampere European Council166 and the Nice Treaty.167 A provisional Unit
(“Pro-Eurojust”) was set up by Council Decision of 14 December 2000 and came into being
on 1 March 2001.168 This Green Paper cannot prejudge the precise role of Eurojust; the most
it can do is offer a few points for reflection.

Whereas the European Public Prosecutor would be a Community authority with his/her own
prosecuting powers in matters specifically relating to the protection of the Community’s
financial interests, Eurojust will be given responsibilities in inter-Governmental cooperation
within a very broad remit.169 In all logic, the establishment of the European Public Prosecutor
would enable Eurojust’s powers in relation to financial crime to be preserved, as long as the
European Public Prosecutor’s priority jurisdiction regarding the protection of
the
Community’s financial
interests was acknowledged. Alongside this clear distribution of
there should be active cooperation in the event of cross-pillar cases.170
jurisdiction,
Consequently their functions would be complementary, the European Public Prosecutor and
Eurojust, applying first- and third-pillar techniques respectively, working in their own areas
for the attainment of the area of freedom, security and justice.

This complementarity means in practical terms that the European Public Prosecutor and
Eurojust would have to cooperate with each other closely and on a regular basis within the
limits of their respective powers, including through the exchange of relevant information. The
exchange should operate in respect for data-protection principles.

Without doubt, cross-pillar cases can arise, as where there are both trafficking in drugs
(third pillar) and cigarette smuggling to the detriment of the Communities’ own resources
(first pillar).

In the event of cross-pillar cases extending beyond the protection of the Community’s
financial interests, each party will have to provide value added on the basis of an exchange of
information,
the dialogue between the European Public Prosecutor and the national
prosecuting authorities then being widened to include Eurojust.171

166

167

168

169

170

171

Presidency Conclusions, point 46.
Articles 29 and 31 of the Union Treaty, as amended (OJ C 80, 10.3.2001).
OJ L 324, 21.12.2000, p. 2.
Commission Communication concerning the establishment of Eurojust, 22.11.2000 (COM(2000)746).
Draft Council Decision establishing Eurojust of 19.10.2001 (Document EUROJUST 12 No 12727).
In this Green Paper a distinction is made between hybrid cases, which concern offences defined for the
protection of the Community’s financial interests at the same time as national offences, and cross-pillar
cases, which concern the Community’s financial interests but also third-pillar offences for which Eurojust
is given jurisdiction. Cross-pillar cases are thus a specific category of hybrid cases: cooperation with the
national prosecution authorities is always necessary, but in cross-pillar cases there will also have to be
cooperation in Eurojust.
Cf. point 6.2.2.2(c) (dialogue between the European Public Prosecutor and the national prosecution
authorities).

65

7.2.2.

Europol

The European Police Office (Europol), set up under the third pillar by the Europol
Convention of 26 July 1995,172 and which came into being on 1 July 1999, is charged with
in particular by exchanging and analysing
preventing and combating organised crime,
information received from the Member States’ police authorities. Discussions are in progress
to extend Europol’s powers and give it more operational tasks. For the moment, therefore, it is
not possible to predict the precise role that Europol will be given.

Cooperation between Europol and the Commission, including OLAF, is planned with a view
to ensuring an exchange of information and complementarity between their respective
functions. Complementarity between the European Public Prosecutor and Europol must also
be envisaged.

The exchange of information should be carefully designed and should operate in respect for
data-protection principles. Sound cooperation should allow the European Public Prosecutor to
enjoy access to all relevant data in matters of protection of the Community’s financial
interests.

By way of example, it is possible to imagine the case of a criminal organisation identified
by Europol and engaging in illegal activities such as trafficking in human beings but also
smuggling spirits; the European Public Prosecutor would need to have information on the
aspects of the case concerning Community own resources.

But in return the European Public Prosecutor should supply Europol with any information that
is relevant to it.

For example, when dealing with a case of smuggling of agricultural produce combined with
a system for gathering and laundering illicit profits, the European Public Prosecutor should
inform the European Police Office of the existence of such a system if there was a
suspicion that it was being used for other illegal purposes, such as trafficking in stolen
vehicles.

7.2.3.

European Judicial Network

Via the Deputy European Public Prosecutors, the European Public Prosecutor should build up
a specialised judicial network enabling to meet the demands placed on him. But every
possible form of synergy with existing general schemes should be sought. The European
Public Prosecutor could establish cooperation on a case-by-case basis with the liaison judges
acting under the Joint Action of 22 April 1996.173

A special relationship with the European Judicial Network might be even more helpful. The
main task of the Network is to facilitate contacts and cooperation between the authorities with
direct local jurisdiction, by participating in the dissemination of general information on the
law and procedures applicable in transnational investigations. The Network, set up under the
third pillar by means of a Joint Action adopted by the Council on 29 June 1998,174 is made up
of a series of contact points. These are officials of competent authorities within the Member
States responsible for all or part of the Member State in question.

172

173

174

OJ C 316, 27.11.1995, p. 1.
The Joint Action of the Council of 22 April 1996 formalised the practice of exchanging judges and
officials with expertise in judicial cooperation procedures on the basis of bilateral or multilateral
arrangements (OJ L 105, 27.4.1996, p. 1).
OJ L 191, 7.7.1998, p. 4.

66

Since the European Judicial Network is concerned primarily with direct bilateral relations
between competent authorities, its functions are both different from and complementary to
those of the European Public Prosecutor. The Network’s contact points could be valuable
partners for
the European Public Prosecutor, especially the Deputy European Public
Prosecutors, in hybrid cases combining Community and national interests.175 In practice, it is
possible to envisage the Deputy European Public Prosecutors attending certain meetings of
the Network (if invited).

Question 15 How would the relationship between the European Public Prosecutor and
those involved in cooperation in criminal matters in the European Union be best
organised?

7.3.

Relations with Community institutions and other bodies

7.3.1. General

The institutions and other bodies set up by the EC and Euratom Treaties and their staff should
be under an obligation to refer to the European Public Prosecutor or inform him of any fact
that might constitute an offence within his jurisdiction that comes to their knowledge.176

The question arises how far this information should still be sent to OLAF as the current
legislation provides.177

7.3.2.

Future role of OLAF

The responsibility incumbent on the European Anti-fraud Office under the legislation
concerns the protection of the Community’s financial interests against unlawful conduct for
which administrative or criminal proceedings can be taken. From its inception OLAF has
enjoyed administrative investigation powers, a portion of the findings of its operational
activity being intended for the national
judicial authorities. The decision establishing
OLAF provides: “The Office shall be in direct contact with the police and judicial
authorities.”178

responsible for protecting the
The establishment of a European Public Prosecutor
interests would significantly affect OLAF’s current role in that
Community’s financial
investigations and prosecutions in this area would be carried out at Community level. The
substantive jurisdiction (compilation of facts) of the Office and the European Public
Prosecutor would partly overlap, and the relationship between them must be clearly
defined.179

The current obligations to inform OLAF would have to be adapted in line with the duty to
refer cases to the European Public Prosecutor. And to avoid unnecessary wasted investigation
efforts, the European Public Prosecutor should be able to use OLAF’s findings for his own

175

176

177

178

179

Cf. point 6.2.2.2 (allocation of cases).
The institutions are defined by Article 7 of the EC Treaty as the European Parliament, the Council, the
Commission, the Court of Justice and the Court of Auditors. Other bodies means all the other bodies.
Article 7 of Regulations Nos 1073/99 and 1074/99; Article 2 of the model decision annexed to the
inter-institutionnel Agreement of 25.5.1999.
Article 2(6) of the Commission decision of 28.4.1999.
Cf. point 6.1 (information and referrals).

67

purposes.180 This means there must be an obligation for the Office to transmit information to
the European Public Prosecutor.

While preserving the acquis communautaire relating to administrative checks and inspections,
OLAF’s status and functions would have to be reviewed in the light of the powers conferred
on the European Public Prosecutor. Several options are conceivable,
though detailed
presentation would be out of place in this Green Paper. The Commission wishes first to
evaluate the current arrangements, as required by the legislation.181 All that will be set out
here is a few basic choices that will have to be made.

First, there is the question whether OLAF should be given judicial investigation powers
within the Community institutions and bodies, for the establishment of a European Public
Prosecutor guaranteed by a national judge of freedoms or a special chamber of the Court of
Justice would open the possibility of judicial review over the Office.

Depending on the answer to that question, it will be necessary to consider whether OLAF’s
functional duality – currently a Commission department enjoying independence in its
investigative function – should be preserved or whether part of the Office should be fully
detached from the Commission. In any event, these questions cannot be answered before the
rules governing OLAF which the legislation requires the
evaluation of
Commission to produce.

the current

Question 16 In the run-up to the Commission’s evaluation of the rules governing OLAF,
what factors related to the relationship between the Office and the European Public
Prosecutor seem most meaningful to you?

7.4.

Relations with third countries

Within the bounds of his/her area of competence, the European Public Prosecutor would have
to deal directly with third-country competent authorities in the area of mutual
judicial
assistance.

But mutual judicial assistance with third countries is governed by conventions to which the
Member State but not the Communities are parties. The hypothesis of conventions to which
the Communities themselves are parties cannot be excluded. It would be helpful if such
agreements allowed the European Public Prosecutor to issue international letters rogatory to
the signatory countries’ judicial authorities.

But as matters stand the simplest solution is to allow the European Public Prosecutor to ask
the prosecution authorities of the Member States to issue direct requests for judicial assistance
to the third country in accordance with the relevant rules of international
law. These
authorities could be placed under an obligation to act accordingly.

Where there is routine cooperation with a given third country, it would be helpful if the
European Public Prosecutor had a central contact point there for all cases linked to the
protection of the Community’s financial interests.

180

181

Cf. point 6.3.4 (evidence).
This Green Paper is without prejudice to the report evaluating the application of Regulations Nos 1073/99
and 1074/99 provided for by Article 15 of those Regulations, which the Commission will prepare in the
light of the prospect of the establishment of the European Public Prosecutor.

68

Of all the Community’ relations with third countries, those with the countries which have
applied for accession are of particular importance. They receive and will continue to receive
significant levels of aid from the Community budget. The experts from the applicant countries
have accordingly been involved in the preparatory work i.e. the Corpus Juris.182

Question 17 What type of relations should the European Public Prosecutor maintain with
third countries, and in particular applicant countries, in order to improve efforts to combat
activities which damage the Community’s financial interests?

182

Study on criminal and administrative penalties, recovery, denunciation and the Corpus juris in the
applicant countries, general report, Ch. Van den Wingaert, 19.9.2001 (forthcoming).

69

8.

JUDICIAL REVIEW OF ACTS OF THE EUROPEAN PUBLIC PROSECUTOR

The Commission has proposed providing in the EC Treaty that the Community legislation
should lay down “the general conditions governing the performance of the functions of the
European Public Prosecutor and ... in particular … (c) rules applicable to the judicial review
of procedural measures taken by the European Public Prosecutor in the exercise of his
functions.”

As seen above, the European Public Prosecutor would be subject to several types of review.
For one thing, the judicial guarantee would be provided by the a priori review by the national
judge of freedoms and the committal review court.183 For another, the European Public
Prosecutor could be held liable in disciplinary proceedings.184 Judicial review arrangements
remain to be determined.

A judicial review procedure should be available against any act done by the European Public
Prosecutor that restricts individual fundamental rights.

8.1.

Reviewable acts of the European Public Prosecutor

8.1.1.

Acts of investigation entailing a restriction or deprivation of personal liberty

Of all the acts of investigation done by the European Public Prosecutor, those entailing a
restriction or deprivation of individual liberty should at least be reviewable. These are acts
ordered by the courts on application from the European Public Prosecutor: arrest warrant,
preventive custody or release on bail.

In all Member States the accused now always has the right to apply for review of such acts in
accordance with the procedures of domestic law, as required by Article 5(4) of the European
Human Rights Convention. Establishing the European Public Prosecutor, therefore, would not
entail any addition to Community law here, as a simple reference to national law would
suffice.

8.1.2. Other acts of investigation

As regards acts of investigation by the European Public Prosecutor authorised by the judge of
freedoms (seizure, freezing of assets, interception of communications, covert investigations,
the establishment of the
controlled deliveries, etc.),
the Commission’s opinion is that
increased
for
European Public Prosecutor should not constitute the occasion either
opportunities for time-saving devices using new review procedures or for abolishing existing
national review procedures.

The national review procedures relating to the measures concerned here vary from one
Member State to another. Where they exist, they would remain available against the European
Public Prosecutor.

By way of example, if a search is to be made in Member State A under an authorisation
given to the European Public Prosecutor by the court in Member State B, such judicial

183

184

Cf. point 6.4.2 (judge of freedoms).
Cf. points 4.1.2.2 and 4.2.1.1 (disciplinary rules applying to the European Public Prosecutor and the
Deputy European Public Prosecutors).

70

review facilities as exist in Member States B and A would be available against the
authorisation itself (challenge to the right to search) and acts done under it (time and search
procedure).

But for the sake of efficiency in action taken by the European Public Prosecutor, it would be
desirable to provide for a minimal measure harmonising judicial review procedures – the
principle that applications for review do not have suspensory effect.

Autonomous acts of investigation by the European Public Prosecutor (documentation,
hearings and questioning, …) would generally not be open to attack as such.

8.1.3. Case closed or not pursued

The decision to close a case would be in the European Public Prosecutor’s discretion. But
there is the question whether the Communities as victim should have standing to act against a
closure decision taken by the European Public Prosecutor on a discretionary basis, in certain
cases at least.

Since the European Public Prosecutor acts fully independently, the Communities might be of
the opinion that a case should be prosecuted even though the Prosecutor has concluded that he
could close it.

Such a divergence might relate, for example, to the adequacy of the evidence gathered.
There is also the possibility that a settlement is reached by the European Public Prosecutor
but on a basis which the Communities consider inadequate.185

The rights of the Communities as victim are always by definition186 determined by the
national criminal law of the Member State of trial, which raises the question of their substance
if no prosecution is brought in any of the Member States. But if the Communities were to
have standing to apply for review of the European Public Prosecutor’s decisions to close
cases, there follows the question of the type of procedure: administrative review? judicial
review? and if so, in what court?

8.1.4. Committal for trial

The committal order would be reviewable on the same basis in the national courts as those
provided for by national law regarding committal orders issued by or for national prosecuting
authorities. Basically any trial court will verify whether it actually has jurisdiction under the
rules of international jurisdiction.

The only specific question regarding committals by the European Public Prosecutor is
whether the discretionary choice of Member State of trial where there are several that might
be “eligible” should be amenable to judicial review on application by the accused. The
accused might claim an interest in the matter as the choice of State will determine the place,
the law and the language of the trial.187

But there are answers to all these arguments. The matter of geographic remoteness is not so
important if it is borne in mind that the accused has himself been operating in several Member
States and therefore accepting the risk. As for the applicable law, the principle of mutual

185

186

187

Cf. point 6.2.2.1 (settlement).
Cf. point 6.3.3 (the Communities as ordinary victims).
Cf. Article 28(1)(d) of the Corpus juris.

71

recognition and the common core of fundamental rights shared by the law of criminal
procedures in the Member States mean that the objection is not insurmountable. And on the
language question, the right to an interpreter secured for the accused by Article 6(3)(e) of the
European Human Rights Convention provides a simple answer.

Conversely, there are many drawbacks to offering the accused the discretionary right to
choose the Member State of trial. The competent court would have to be determined, which
once again raises the question of establishing a special Community court. It does not go
without saying that the committal order directly and individually concerns the accused –
which is a general condition for the admissibility of an individual action. Basically,
introducing review on this basis would weaken the principle of a common investigation and
prosecution area. It would open the way to systematic challenges by the defence for potential
dilatory purposes. This hypothesis could therefore be entertained only within very strict legal
limits.

Question 18 What procedures should be available for judicial review of acts done by the
European Public Prosecutor or under his authority in the exercise of his functions?

8.2.

Right to review

More generally, it is necessary to locate the entire scheme (European Public Prosecutor, judge
liberties, committal review court, trial court) within the existing court systems both nationally
and in the Community.

8.2.1.

Review under domestic law

8.2.1.1. At the preparatory stage

In all logic, the possibilities for seeking review of decisions by the national judge of freedoms
would be those provided for by domestic law. The same applies to challenges addressed not to
the investigation measure as authorised by the court but to the way in which it is executed by
the European Public Prosecutor. And review should be available on application by a third
party affected by the measures who has no possibility of making his views known to the judge
of freedoms (such as the author of correspondence that is seized).

The possibilities for review of decisions by the committal review court would be those
provided for by domestic law under the options for a national court or those for Community
actions under the option of a Community Pre-Trial Chamber, as the case may be.

Given the preferences expressed by the Commission, the general principle would be to refer
to national law.

8.2.1.2. At the trial stage

The proposal to establish a European Public Prosecutor should not cause upheavals in the
national judicial systems. The Commission is of the opinion that domestic review procedures
should not be affected.

The need for equivalent protection of the Community’s financial interests might justify an
attempt to align the organisation of the various review procedures available in the Member
States in this area. It might thus be possible to lay down a number of common principles at

72

Community level.188 The Member States could, for example, undertake to make provision for
appeal against any first-instance judgment or, in the event of an appeal by the sentenced
person, the exclusion of any more severe penalty being imposed than the one already handed
down. But this would not be indispensable for the efficient operation of the European Public
Prosecutor; the Commission would like, in its proposals, to concentrate on the pre-trial phase.

To stay more proportionate to the objective pursued, the European Public Prosecutor should
slot into the national judicial systems. This should result in provision being made for the same
possibilities of review as are open to domestic prosecuting bodies. In particular, the European
Public Prosecutor should in principle be able to appeal against any acquittal decision.

8.2.2.

Review by the Court of Justice

In order to preserve the existing balance between Community and national powers, the
Commission takes the view that the Court of Justice should have no power to contest
decisions given by national criminal courts. The proposed arrangements must be situated in
relation to the Community court system, as the former are not entirely without impact on the
latter.189

Under the Treaty, the Court of Justice is charged with ensuring that, in the interpretation and
application of Community law, the law is observed. Consequently, as far as the European
Public Prosecutor is concerned, the Court of Justice should have the power to issue a
preliminary ruling under Article 234 of the EC Treaty on the interpretation of Article 280a
and any Community rules adopted to implement it.

The establishment of a European Public Prosecutor would not affect review procedures in
respect of a failure to fulfil obligations by a Member State (Articles 226 to 228 of the EC
Treaty) or a Community institution (Article 232 of the EC Treaty) insofar as the European
Public Prosecutor is not regarded as a Community institution but rather as a Community body
and, moreover, the Commission retains its role as guardian of the Treaties. A dispute
concerning the application of Article 280a of the EC Treaty and rules implementing it could
therefore be referred to the Court of Justice solely by the Commission or the Member States,
as is currently the case.

Finally, as things stand with Articles 178 and 288 of the EC Treaty regarding the
Community’s non-contractual liability, the Community must make good any damage caused
by the European Public Prosecutor and his/her staff.190

If actions for annulment under Article 230 EC were extended to certain acts of the European
Public Prosecutor, the Treaty would have to be amended accordingly. But the Commission
takes the view that judicial review should, as far as possible, occur at Member State level and
that, consequently, review procedures vis-à-vis the acts of the European Public Prosecutor
should be organised at the level of the national judge of freedoms (see section 7.1 above).191

The fact remains that, depending on the option selected, the jurisdiction of the Court of
Justice could be extended to certain types of litigation. An initial hypothesis was to give the

188

189

190

191

See in particular Article 27 of the Corpus juris.
COM (2000) 34, point 5 (the Union court system), supra.
Court of Justice, Case C-370/89 SGEEM and Etroy v EIB [1992] ECR 6211 (judgment given on
2.12.1992).
Cf. point 6.4.2 (judge of freedoms).

73

accused the possibility of challenging the European Public Prosecutor’s choice of Member
State of trial, a direct action being provided for, presumably in the Court of First Instance of
the European Communities.

A second hypothesis was that the Court of Justice should have jurisdiction to deal with
conflicts of jurisdiction raised by the European Public Prosecutor or the national courts,
whether between Member States or between the latter and the Community. In particular, if the
national committal review court had jurisdiction to review manifest errors in the European
Public Prosecutor’s choice of forum, the Court of Justice should be available to hear actions
by the European Public Prosecutor in the event of jurisdiction being declined or of negative
conflicts of jurisdiction subject to the principle of cases being concluded within a reasonable
period of time.

In any event, none of these hypotheses would violate the principle jurisdiction to hear
criminal cases on the merits lies with the national courts.

74

9.

CONCLUSION

By way of conclusion, the Commission wishes to know the opinions of all circles concerned
regarding the implementation of its proposal so that it can draw conclusions and, if necessary,
present a fresh contribution in the preparations for the next round of Treaty amendments.

This Green Paper will have clarified the proposal made by the Commission in 2000. The
preferences at this stage for certain options might prompt the Commission to propose adding
new provisions to the Treaty to provide a legal basis for:

• the appointment of an independent European Public Prosecutor centralising the
management of investigations and prosecutions and exercising the prosecution function in
the competent courts in the Member States in cases concerning the protection of the
Community’s financial interests; and

• the adoption of a set of specific rules determining among other things:

– the rules applicable to him, typified by a highly decentralised organisation based on
Deputy European Public Prosecutors and the assistance of national investigation services
in the Member States;

– the rules of substantive criminal law to be applied by him, with a trend towards unification
of the more specific among them (offences within his jurisdiction, the corresponding
penalties, limitation periods) or simply towards harmonisation (liability of legal persons),
and a reference to national law for the remainder, representing in fact the bulk;

– the criminal procedure applied by the European Public Prosecutor in full respect for
fundamental rights on the basis principally of mutual recognition of measures of
investigation provided for by national law (searches etc.), in some cases harmonised at
European level (European arrest warrant etc.), subject to review by the national judge of
freedoms, and secondarily of certain Community rules (opening, closure, European model
reports etc.);

– exceptions from the mandatory prosecution principle and the distribution of cases,

particularly hybrid cases, with the national prosecution authorities;

– rules governing the admissibility of evidence, based on the principle that evidence that is
admissible in one Member State should be admitted by the courts of all the other Member
States;

– relations between the European Public Prosecutor and others involved internationally, in
particular the possibilities for exchanging information with respect for data protection;

– procedures for reviewing acts done under the authority of the European Public Prosecutor,
principally those of domestic law and secondarily those to be provided for, if necessary, in
the Court of Justice.

The organisation of the courts (judge of freedoms, committal review court, trial court) and the
trial stage, and the execution of penalties would remain entirely governed by national law,
subject to the principle that the prosecution is in the hands of the European Public Prosecutor.

75

The proposal for Community centralisation of the management of investigations and
prosecutions in the field of the protection of the Community’s financial interests in order to
guarantee efficient and equivalent enforcement in a common area is now opened to a great
debate unconstrained except by respect
fundamental rights and the principles of
for
subsidiarity and proportionality.

76

ANNEX 1
Additional Commission contributionto the Intergovernmental Conference on
institutional reforms of 29 September 2000

The criminal protection of the Community’s financial interests: a European
Prosecutor192

Introduction

the Commission suggests in connection with the protection of

In its opinion of 26 January 2000 “Adapting the institutions to make a success of
enlargement”,193
the
Community’s financial interests that a legal basis be created in the Treaty for setting up a
system of rules relating to offences and the penalties that
to the requisite
procedural provisions for the prosecution of these offences and to the powers and tasks of a
European Public Prosecutor responsible for detecting fraud offences throughout European
territory and for prosecutions in the national courts. In the framework of its new anti-fraud
strategy,
the Commission has confirmed its wish to strengthen the protection of the
Community’s financial interests in this respect.

they incur,

In 1998 fraud and other irregularities affecting to the Community’s financial
interests
accounted for a total estimated by the Member States and by the Commission at over a billion
euros.194 The involvement of organised crime in fraud to the detriment of the Community’s
financial interests and the transnational character of such crime presuppose cooperation with
fifteen legal orders applying different rules of both substance and procedure. The current
methods of cooperation often prove insufficient to overcome the difficulties faced by the
judicial and police authorities in their fight against such fraud.

These difficulties will increase as the number of Member States and the number of operators
and administrations involved in the management of Community funds rise.

The powers which this Communication proposes should be vested in a European Public
Prosecutor would be limited strictly to the protection of the Community’s financial interests
as already defined and circumscribed in Article 280(1) of the EC Treaty.

The Communication proposes that only the essential characteristics of the office would be
laid down in the Treaty (appointment, removal, duties, and independence), leaving the rules
and mechanisms governing its operation to be regulated by secondary legislation.

1.

THE COMPLEXITIES TO BE OVERCOME IN VIEW OF THE COMMUNITY’S SPECIFIC
RESPONSIBILITIES FOR THE PROTECTION OF THE COMMUNITY’S FINANCIAL
INTERESTS

The shortcomings of the current mechanism are due mainly to the fragmentation of the
European criminal law-enforcement area, which results from the fact that the national police
and judicial authorities are empowered to act only on their own territory. The traditional
judicial assistance and cooperation between police forces remain
methods of mutual

192

193

194

COM (2000) 608.
COM (2000) 34, http://europa.eu.int/comm/igc2000/offdoc/opin_igc_en.pdf.
European Commission, Annual report 1998: protection of the Communities’ financial interests and the
fight against fraud (COM (99) 590), point 1.3.

77

cumbersome and are often unsuited to an effective fight against transnational fraud. And
experience has shown the difficulties of making a success of administrative inquiries in terms
of prosecutions.

But the Community’s financial interests ought to be protected especially rigorously and in
equivalent fashion in all the Member States, since the money involved represents pooled
resources. Responsibility for ensuring that the Community’s financial interests are protected
rests on the Member States and the Community both. In these circumstances, the European
Union must be able to guarantee the Member States and their citizens that offences of fraud
and corruption are genuinely prosecuted in the courts.

1.1

The fragmentation of the European law-enforcement area

Article 280 EC states that measures adopted by the co-decision procedure to counter fraud
and any other illegal activities affecting the financial interests of the Community “shall not
concern the application of national criminal law or the national administration of justice”.
The EC Treaty as its stands, therefore, confers no powers to set up a European criminal
law-enforcement area comprising a common judicial body such as a prosecutor.

The signing of the Convention on the protection of the financial interests of the European
Communities of 26 July 1995 and of its additional protocols constitutes a first step towards
the criminal protection of the Community’s financial interests. These documents, which are
the fruit of cooperation between governments under the “third pillar”, are an important asset
since they define fraud, misapplication of funds and corruption as offences incurring criminal
penalties in all Member States.

But the Convention and its protocols have not yet entered into force as they have not been
ratified by all the contracting parties. When they are in force, there will still be a degree of
uncertainty as to the way in which they will be transposed into national criminal law by all the
parties. What is more, these provisions alone will not suffice to eliminate the fragmentation of
the European law-enforcement area as prosecutions will still be brought at national level.

Thus, given that there are fifteen different systems of criminal law, the Community has only
very limited means to ensure effective and equivalent protection of the Community’s financial
interests in the Member States, as required by the Treaty. In the current situation, however
effective the administrative coordination that the European Anti-fraud Office can generate,
criminal proceedings remain uncertain. The Community does not have the instruments to
supplement preventive action and administrative inquiries with a prosecution function.

Example:

The effect of the fragmentation of judicial authorities between the Member States is that
there can be competing, partial or non-existent proceedings.

The ban on beef and veal exports from certain areas of the Community owing to BSE
infection was circumvented by operators in three Member States when exporting to a
non-member country. Commission action and the exposure of this scheme to defraud the
agricultural subsidy system led thereafter to the opening of competing prosecutions in
several Member States against the same offenders for the same offences. Yet although the
proceedings began in mid-1997, the case has come to judgment in only one Member State.

This situation is unacceptable, in particular in areas of Community activity where subsidies
are the rule, such as the common agricultural policy.

78

1.2

The traditional methods of judicial cooperation between the Member States are
cumbersome and inappropriate

National mechanisms are the basis for criminal protection against transnational crime and
remain essential. There are also international forms of cooperation in criminal matters, now
boosted by the strengthened provisions for judicial cooperation under the third pillar.

But the development of organised crime to the detriment of the Community’s financial
interests makes the traditional instruments of mutual judicial assistance inadequate, and the
progress achieved in judicial cooperation is also insufficient. There is no possibility of
providing an interface between the Community level and the national judicial authorities in
the Treaty as it stands.

Example:

The inadequacy of cooperation between Member States in criminal matters generates
delays, dilatory actions and unpunished offences. In transnational financial fraud cases it all
too often allows evidence to be destroyed and suspects to disappear. This is particularly
prejudicial when it comes to reconstructing downstream financial channels used in cases of
fraud against the Community’s financial interests.

To take but one example, on the occasion of a public hearing before the European
Parliament, a prosecutor from a Member State stated that he had had to deal with as many
as 60 successive actions in the requested State in a single case likely to affect
the
Community’s financial interests. The actions were brought one after the other to benefit in
each instance from the time needed by the judge to dismiss them. It follows that, when the
international letters rogatory are executed, they will generally be of no real use.

1.3

Difficulties
prosecutions

in making administrative

inquiries

culminate

in successful

Numerous cases based on the Community experience in recent years thus testify to persistent
obstacles in a field where precisely the specific responsibilities of the Community and the
Member States create the need for a clear perception of the interests to be protected and for
greater efficiency in proceedings in terms of the Community territory.

Example:

The transmission of information between Member States and between them and the
European Anti-fraud Office (OLAF) is hampered by differences in the rules governing
prosecutions in each Member State. If, for the same offence, the inquiry is handled in some
Member States by a judge but in others by an administrative authority, direct contact
between the two is generally impossible in both fact and law. Moreover, not all the relevant
national authorities even have access to information under the various national rules, in
particular
the
confidentiality of criminal investigations.

those concerning the secrecy of

tax and business

information or

Example:

An attempt to prosecute the organisers of an major transnational fraud detrimental to the
Community’s own resources in two Member States, A and B, is an exemplary real case in
this respect. A judge in a third Member State (C), where the accused actually resided, to
whom the case was referred by the national customs authorities declared their action
inadmissible on the specific ground that the certificate provided by the authorities of
Member State A was insufficient for the purpose of proceedings in Member State C. This
certificate confirmed, however, that the offence was punishable under the law of Member
State A and referred to the penalties incurred by offenders in that State. Under the rules of

79

Member State C, however, the judge was unable to admit the certificate issued by the
customs authorities of Member State A as valid evidence.

2.

THE PROPOSED MECHANISM

***

In the absence of a specific Community institutional structure the existing mechanisms,
however legitimate and irreplaceable they may be, amount to obstacles to prosecution by the
police and the courts and advantages for the criminal. Given the design of the Treaty,
therefore, the Commission recommends that in order to respond to the current situation the
primary legislation should be amplified to allow the creation of an office of European Public
Prosecutor, its organisation and operation being governed by secondary legislation. This
amendment would be confined to protection of the Community’s financial interests.

2.1 Mature and detailed preparatory study

The Commission proposal
to the Intergovernmental Conference is based on detailed
preparatory work. For nearly ten years now, at the request of the European Parliament and the
Commission, a group of experts in criminal law from all the Member States has been working
on the criminal protection of the Community’s financial interests. Their work produced the
proposal for a set of rules for the criminal protection of the Community’s financial interests,
the well-known Corpus Juris.195 It recommends the creation of a unified Community
law-enforcement area as regards the preparatory stages of court proceedings precisely by the
harmonious insertion in the national systems of a European Public Prosecutor, excluding any
communitarisation of the administration of criminal justice.196

The authors of the Corpus Juris specified the possible architecture of an independent
European Public Prosecutor, responsible in matters of the protection of the Community’s
financial interests for directing investigations and prosecuting cases in the relevant national
courts and for coordination with national procedures.

The organisation would be highly decentralised. The European Public Prosecutor would be
supported by Deputy European Prosecutors in the Member States so as to secure the link
between the Community mechanism and the national legal systems.

2.2

The object of the reform

In this spirit, the Commission recommends the institution of an independent European Public
Prosecutor to protect the Communities’ financial interests.

This would supplement the reform of the Community courts as proposed by the Commission
in its additional contribution to the Intergovernmental Conference of 1 March 2000197 by

195

196

197

Corpus Juris introducing penal provisions for the purpose of the financial interests of the European
Union, under the responsibility of Ms Delmas-Marty, Economica, Paris, 1997. The Corpus Juris is also
available on the Internet (http://www.law.uu.nl/wiarda/corpus/index1.htm).
In response to these recommendations, the experts more recently completed a comparative study on the
need for and legitimacy and feasibility of the Corpus Juris, analysing the potential impact of a European
Prosecutor on national prosecution systems: The Implementation of the Corpus Juris in the Member
States, Ms Delmas-Marty / J.A.E. Vervaele, Intersentia, Utrecht, 2000.
Additional Commission contribution to the Intergovernmental Conference on institutional reform:
Reform of the Community courts (COM (2000) 109 final).

80

adding a judicial body with the function of bringing prosecutions in the courts of the Member
States and of exercising ongoing control of criminal investigations across the Community
territory in order to enforce the law and protect the Community’s finances. The point is not to
communitarise the administration of criminal justice, which would remain within national
powers.

2.3

The methods of the reform

In the Commission’s view, the Treaty will need amending only as regards the European
Public Prosecutor’s appointment and removal from office and the definition of his main tasks
and the principal characteristics of his function, to be set out in a new Article 280a. The
Treaty would provide for secondary legislation to lay down the regulations applicable to him
and govern his operation.

2.3.1 The appointment of the European Public Prosecutor (paragraphs 1 and 2 of the new

Article 280a)

The Commission proposes that the European Public Prosecutor be appointed by the Council,
acting by a qualified majority on a proposal from the Commission with the assent of the
European Parliament. The proposal, which should be made by the Commission in view of its
specific responsibility for protecting the Community’s financial interests, would be submitted,
for example, in the form of a list of candidates from which the Council could select the
European Public Prosecutor. The Commission further considers that conditions governing the
removal from office of the European Public Prosecutor should be laid down (paragraph 2 of
new Article 280a). Regarding the term of
the Commission proposes a
non-renewable term of six years (paragraph 1 of new Article 280a). An essential
characteristic of
in particular be stressed: his
independence as a judicial officer (paragraph 2 of new Article 280a). Apart from these
essential elements, the revised Treaty would leave the regulations governing the Prosecutor in
respect of such things as structure, location of offices, etc. to be determined by Community
secondary legislation in accordance with the procedure laid down in Article 251 of the Treaty,
which calls for a qualified majority in the Council and co-decision with Parliament.

the European Public Prosecutor must

the office,

2.3.2 Conditions for the exercise of the European Public Prosecutor’s functions (paragraph

3 of the new Article 280a)

With regard to the conditions for the exercise of the European Public Prosecutor’s functions, a
specific mechanism confined to activities detrimental to the Community’s financial interests
is necessary to ensure smooth operation in terms of both substantive criminal law and
criminal procedure. These rules should be adopted by the Council by the co-decision
procedure.

to the
To clarify the Prosecutor’s powers, offences relating to activities prejudicial
Community’s financial interests (fraud, corruption, money laundering etc.) and the relevant
penalties should be defined more explicitly at Community level. It is difficult to reconcile the
rigour of the criminal law with the existence of differences throughout the Community if the
point is to ensure the effective and equivalent protection of the Community’s financial
interests. The definitions of these common offences should therefore be uniformly applicable
in the national legal systems by the national criminal courts, as the ordinary courts of
Community law, and this implies the adoption of specific rules. The provisions drawn up
under the Convention of 26 July 1995 referred to above and its additional protocols already
provide a solid basis that has the agreement of the Member States.

81

Moreover, the performance of the Prosecutor’s duties will have to be made subject to rules of
procedure (on such points as the mechanisms for referring cases to the Prosecutor, the
Prosecutor’s powers of investigation, or the initiation and termination of enquiries) and rules
of judicial review (on such points as the review of acts done by the Prosecutor, whether or not
under a warrant granted by a national judge). The Corpus Juris describes some possible
options for rules of procedure and coordination with the national authorities. Rules of this
kind will in any event have to be spelt out in proposals for secondary legislation, which will
have to respect the national legal systems and traditions. Provision must therefore be made for
the enactment of the following, by the procedure laid down in Article 251 of the Treaty:

– rules concerning offences (subparagraph 3(a) of the new Article 280a);

– rules of procedure applicable to the activities of the Prosecutor and rules governing the

admissibility of evidence (subparagraph 3(b) of the new Article 280a);

– rules for the judicial review of the Prosecutor’s actions, such rules being essential for the

performance of his duties (subparagraph 3(c) of the new Article 280a).

These provisions of secondary legislation should also determine how this Community
mechanism meshes with the national legal systems.

***

82

the Commission proposes that

the current
In conclusion,
provisions concerning the protection of the Community’s financial interests with a legal basis
allowing:

the Conference supplement

• the appointment of an independent European Public Prosecutor exercising the prosecution
function in the courts of the Member States in the field of the protection of the
Community’s financial interests and within the framework of specific rules adopted for this
purpose; and

• the subsequent adoption through secondary legislation of:

– the regulations applicable to his office,

– rules of substantive law concerning the protection of financial interests by the

European Public Prosecutor (offences and penalties),

– rules governing criminal procedure and the admissibility of evidence,

– (c) rules applicable to the judicial review of procedural measures taken by the European

Public Prosecutor in the exercise of his functions.

83

Current text of EC Treaty

Article 280

Proposed text

Article 280

1. The Community and the Member States shall counter fraud and any other
illegal activities affecting the financial interests of the Community through
measures to be taken in accordance with this Article, which shall act as a
deterrent and be such as to afford effective protection in the Member States.

1. The Community and the Member States shall counter fraud and any other
illegal activities affecting the financial interests of the Community through
measures to be taken in accordance with this Article, which shall act as a
deterrent and be such as to afford effective protection in the Member States.

2. Member States shall take the same measures to counter fraud affecting the
financial interests of the Community as they take to counter fraud affecting
their own financial interests.

2. Member States shall take the same measures to counter fraud affecting the
financial interests of the Community as they take to counter fraud affecting
their own financial interests.

3. Without prejudice to other provisions of this Treaty, the Member States
shall coordinate their action aimed at protecting the financial interests of the
Community against fraud. To this end they shall organise, together with the
Commission, close and regular cooperation between the competent
authorities.

3. Without prejudice to other provisions of this Treaty, the Member States
shall coordinate their action aimed at protecting the financial interests of the
Community against fraud. To this end they shall organise, together with the
Commission, close and regular cooperation between the competent
authorities.

4. The Council, acting in accordance with the procedure referred to in
Article 251, after consulting the Court of Auditors, shall adopt the necessary
measures in the fields of the prevention of and fight against fraud affecting
the financial interests of the Community with a view to affording effective
and equivalent protection in the Member States. These measures shall not
concern the application of national criminal
the national
administration of justice.

law or

4. The Council, acting in accordance with the procedure referred to in
Article 251, after consulting the Court of Auditors, shall adopt the necessary
measures in the fields of the prevention of and fight against fraud affecting
the financial interests of the Community with a view to affording effective
and equivalent protection in the Member States. Without prejudice to
Article 280a, these measures shall not concern the application of national
criminal law or the national administration of justice.

5. The Commission, in cooperation with Member States, shall each year
submit to the European Parliament and to the Council a report on the
measures taken for the implementation of this Article.

5. The Commission, in cooperation with Member States, shall each year
submit to the European Parliament and to the Council a report on the
measures taken for the implementation of this Article.

Article 280a

84

1. To contribute to the attainment of the objectives of Article 280(1), the
Council, acting on a proposal from the Commission by a qualified
majority with the assent of the European Parliament, shall appoint a
European Public Prosecutor for a non-renewable term of six years. The
European Public Prosecutor shall be responsible for detecting,
prosecuting and bringing to judgment the perpetrators of offences
prejudicial to the Community’s financial interests and their accomplices
and for exercising the functions of prosecutor in the national courts of
the Member States in relation to such offences in accordance with the
rules provided for by paragraph 3.

2. The European Public Prosecutor shall be chosen from persons whose
independence is beyond doubt and who possess the qualifications
required for appointment to the highest judicial offices in their
respective countries. In the performance of his duties, he shall neither
seek nor take any instructions. The Court of Justice may, on application
by the European Parliament, the Council or the Commission, remove
him from office if he no longer fulfils the conditions required for the
performance of his duties or if he is guilty of serious misconduct. The
Council, acting in accordance with the procedure laid down by Article
251, shall lay down the regulations applicable to the European Public
Prosecutor.

3. The Council, acting in accordance with the procedure laid down by
Article 251, shall
lay down the general conditions governing the
performance of the functions of the European Public Prosecutor and
shall adopt, in particular:

(a) rules defining the facts constituting criminal offences relating to
fraud and any other illegal activity prejudicial to the Community’s
financial interests and the penalties incurred for each of them;

(b) rules of procedure applicable to the activities of the European
Public Prosecutor and rules governing the admissibility of evidence;

(c) rules applicable to the judicial review of procedural measures

85

taken by the European Public Prosecutor in the exercise of his
functions.

86

ANNEX 2

Simplified procedures

The charts below display some of the main features of the procedure that the European Public
Prosecutor might follow. They reflect neither all the situations nor all the options envisaged
in the Green Paper. They are here to help the reader understand the text, not to replace it.

87

Structure of European Public Prosecutor

1. Information/Referral

Member Strate I

Administration

Police

Courts

National

Prosecution

Service

Deputy

European

Prosecutor

Judge of
Freedoms

Public

(Residents,

Firms)

Member State II

Administration

Police

Courts

National

Prosecution

Service

Deputy

European

Prosecutor

Member State III

Administration

Police

Courts

National

Prosecution

Service

Judge of
Freedoms

Deputy

European

Prosecutor

Judge of
Freedoms

Own motion

European

Prosecutor

Europol

Eurojust

EJN

OLAF/Commission

Common investigation/prosecution area

This table does not reflect a specific institutional structure but a functional structure in the Member States. It does not

Express a view on the authority exercising the national prosecution function or the judge of freedoms.

88

2. Investigation stage

Member State I

Administration

Member State II

Administration

Member State III

Administration

Police

Courts

National
Prosecution
Service

Deputy
European
Prosecutor

Judge of
Freedoms

House

search

à

(2)

(1)
Information

Police

Courts

National
Prosecution
Service

Deputy
European
Prosecutor

Judge of
Freedoms

Police

Courts

National
Prosecution
Service

Deputy
European
Prosecutor

Judge of
freedoms

(1)

Questioning

Arrest warrant
(3)

(1)

Hearing

Case open/Acts of investigation

referral

European

Prosecutor

(1) = Acts of investigatiuon in the European Public Prosecutor’s discretion/Legal effect in common area
(2) = Acts of investigation reviewable by judge of freedoms
(3) = Acts of investigation ordered by judge of freedoms

Mutual recognition in Member States

Common investigation/prosecution area

The acts of investigation are given by way of example

89

3. Prosecution stage

Member State I

Administration

Police

Member State II

Administration

Police

Joint
prosecution

Member State III

Administration

Police

National

Courts

National

Courts

National

Courts

Prosecution

Service

Deputy

European

Prosecutor

Committal
Court

Prosecution

Service

Deputy

European

Prosecutor

Committal
Court

Prosecution

Service

Deputy

European

Prosecutor

Committal
Court

Principal prosecution

(1) = Committal for trial

European

Prosecutor

(2) Case closed

(3) Settlement

Common investigation/prosecution area

Preferred solution: single court. The European Public Prosecutor could also commit for trial in several Member States.

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ANNEX 3

Hypothetical fraud case
handled by the European Public Prosecutor

The example of a fraud case given here - including all facts and names – is pure fiction and
has been imagined solely as an illustration for the Green Paper.

THE FACTS

Our hypothetical firm, “Meat International”, is headquartered in London and has been in the
it has
import-export business for years. Following a food scare in the business,
meat
considerably increased its imports of quality meat from Latin America, Brazil and Argentina
in particular. In parallel, it has exported significant quantities of Community meat to Russia.
It has used the ports of Antwerp and Lisbon for its imports and Rotterdam for exports.

Meat imports

Meat International has displayed great creativity in evading customs duties (a Community
resource) to every possible extent.

• First, it has tried falsifying the nature of the goods. It has declared 20% of its quality meat

imports as ”offal”, subject to very low duty rates.

• Then it has falsified the origin of the goods to enjoy the benefit of preferential tariff
arrangements to which it is not entitled. Argentina is entitled to export a quota of Hilton
Beef to the Community at a preferential tariff rate (zero or very low customs duties). To
obtain this special customs treatment, it must obtain certificates of authenticity from the
Argentine Ministry of Agriculture. Meat
International has systematically imported
lower-quality beef from Paraguay instead of Hilton Beef. For this purpose it has used
certificates issued illegally by an Argentinean civil servant, to whom they have paid
US$ 5000 per container.

• The containers were imported and released on the European Union market via the ports of
Antwerp and Lisbon. Meat International Antwerp and Meat International Lisboa have
filed customs declarations in their capacity as consignors. Transeurope, a haulage firm
based in Madrid, was responsible for distribution from Antwerp and Lisbon to customers
throughout Europe.

Meat exports

On the export side, Meat International has received subsidies (Community expenditure) to
which it is not entitled.

•

In Britain it has bought British meat that cannot be sold elsewhere on the Community
market or exported from the Community (embargo), in large quantities at knock-down
prices. The meat has been frozen and then carried illegally to Antwerp, where Label
International has labelled it as meat from Belgium. It has then been exported to Russia,
such exports being subsidised by the Community by its export refund scheme.

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• Customs declarations have been prepared by the consignor, Meat International Antwerp.
Part of the meat has been exported to Russia by sea from the port of Rotterdam, the rest
being carried by road by Transeurope.

The financial loss

The gain to the firm was considerable, given the amount of customs duties evaded and
refunds received. To conceal the scale of its wrongdoing, the firm set up a series of companies
with no real business activity in Argentina, Europe and the Caribbean so that false invoices
could be made out. The firm used these companies to make large-scale investments on the
London Stock Exchange and the Lugano real-estate market. Considerable amounts of
corporate income taw were thus also evaded.

CRIMINAL PROCEEDINGS WITHOUT A EUROPEAN PUBLIC PROSECUTOR

• Customs officers in Antwerp discover a container carrying quality meat from Argentina
that false customs
rather than the offal on the declaration. They begin to suspect
declarations are being filed to evade customs duty. When Meat International Antwerp’s
accounts are examined, it turns out that they have been trafficking for quite some time.

• The Customs refer the case to the Belgian onderzoeksrechter (juge d’instruction). He asks
the criminal investigation police to question the managers of Meat International, London,
and the managers and drivers of Transeurope, Madrid; he would also like to order
searches of the firms’ premises. International letters rogatory are issued. Five months
later, the onderzoeksrechter receives the results. He discovers that Transeurope and Meat
International Antwerp (the consignor) are owned by Meat International and that there is a
network set up on a permanent basis for the purpose of criminal activities.

• The Belgian judicial authorities open criminal

investigations into Meat International
Antwerp and Meat International. The criminal court at Antwerp convicts the managers of
the two firms and sentences them to heavy fines and suspended prison terms.

• But the penalties will be difficult if not actually impossible to enforce. Meat International
reacts to the news of the investigations by selling its equity holdings on the London Stock
Exchange and reinvesting the proceeds in real estate in Curaçao, using its offshore firms
for the purpose. Its manager, who also has Swiss nationality, has settled in Lugano
following the searches. The manager of Meat International Antwerp has disappeared; so
have the company’s available funds.

• Meanwhile the Dutch police, during a routine check on a lorry belonging to Transeurope,
discover meat with Belgian labels bound for Russia, and for some reason are suspicious.
In view of the circumstances, they seize the meat. Physical checks confirm that the meat is
actually of British origin and subject to embargo.

• The Dutch judicial authorities issue international letters rogatory in Belgium and Spain to
International Antwerp and
gather more evidence from Meat
Transeurope. They ascertain that Transeurope has links with Meat International Lisboa
and that the false labels were affixed by Label International.

International, Meat

• The evidence is passed on to the Portuguese authorities. The Portuguese judicial authorities
are informed about the case via the European Judicial Network or Eurojust. The Dutch

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authorities decide to drop the case without action as the links with the Netherlands are
tenuous and there is no record of previous offences.

•

In Portugal, unfortunately, the Prosecution Service is faced with the problem that the
evidence was not gathered in the course of action in response to the international letters
rogatory in accordance with the requirements of the Portuguese law of criminal procedure.
It was gathered by criminal investigation police officers and not by the Prosecution
Service or an examining judge, so that the evidence is inadmissible in Portugal.

• And all

the British police and judicial authorities do is execute the requests for

international letters rogatory. They open no proceedings against Meat International.

CRIMINAL PROCEEDINGS WITH THE EUROPEAN PUBLIC PROSECUTOR (ON THE BASIS OF
THE EUROPEAN COMMISSION’S PREFERENCES)

• The Belgian customs authorities inform the European Public Prosecutor on the basis of
their suspicions regarding the firms that have filed false declarations to evade duties. The
Dutch police also inform the European Public Prosecutor of the facts they have observed
with the meat they have discovered, which raises suspicions of fraud against the export
refund scheme. In both cases, the firms mentioned in the case are Transeurope, the carrier,
Meat International Antwerp, the consignor, and Meat International.

• Because information is coordinated and centralised, the European Public Prosecutor has
the advantage that he can combine information from different sources to gain a broader
picture of what turns out to be a single case. For one thing, he sees the link between the
two sides of the case, if only because the same firms are involved. For another, he now
has enough information to realise that there is a major Community fraud case with a
cross-border dimension involving transactions in many countries, which warrants
investigation by him. He does not refer the case to the national authorities.

information about

• He begins by asking the Deputy European Public Prosecutors in the Member States to
seek further
the firms concerned. The exchange of information
available from the national police and judicial authorities fleshes out the file. It becomes
clear that Meat International engages in extensive import business via the port of Lisbon,
where it uses Meat International Lisboa as consignor. The information exchanged shows
that Meat
International Lisboa and Transeurope are all
owned by Meat International.

International Antwerp, Meat

• The European Public Prosecutor consequently suspects that

there is a criminal
organisation set up to commit business and financial offences to the detriment of the
Community budget. To test his suspicions, he decides to order the organisation’s
communication (telephone, fax, e-mail) to be intercepted. He lays his decision before the
judge of freedoms in the United Kingdom, the state where the main firm is headquarters,
for review. Having obtained the authorisation of the judge of freedoms, interceptions are
executed under the direction of the European Public Prosecutor by the competent
authorities in the Member States concerned. The warrant issued by the British court
enjoys mutual recognition throughout the common investigation and prosecution area.
The interceptions fairly quickly provide firm evidence of the existence of the network, the
scale of its criminal activity, the financial flows and the fact that the manager of Meat
International is the principal perpetrator.

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• Being responsible for coordinating and directing the judicial investigation, the European
Public Prosecutor asks for a cross-border investigation in order to 1) question the persons
who matter in the relevant firms; 2) seize the firms’ accounting books; 3) freeze the firms’
assets; and 4) have the managers of Meat International arrested. The Deputy European
Public Prosecutors execute the requisite acts of investigation.

• An application to freeze assets is made to the judge of freedoms in the United Kingdom.
He authorises the assets to be frozen and issues a European arrest warrant against the
International. The authorisation and the warrant are enforceable
manager of Meat
throughout the common investigation and prosecution area, wherever the person and the
assets concerned are to be found.

import and export operations, a division of

• Acts of investigation conducted in several Member States yield documentary evidence of
fraudulent
labour between the firms,
profit-sharing between their managers and profit-laundering. Major assets are frozen in
London, while smaller sums are frozen in Antwerp and Lisbon. Documentary evidence
shows that Meat International owns real estate in Lugano. To seize these assets, the Deputy
European Public Prosecutor in London sends the Swiss authorities an international letter
rogatory on the basis of the Council of Europe Convention on mutual judicial assistance in
criminal matters and the protocol to it or a (hypothetical) European convention on mutual
judicial assistance between the European Public Prosecutor and Switzerland.

• At the end of the preparatory stage, the European Public Prosecutor decides to send the
chief perpetrators for trial – the companies (Meat International, Meat International
Antwerp, Meat International Lisboa, Transeurope and Label International) and certain
persons in positions of responsibility within them. They are accused of Community fraud
and money-laundering, with membership of a conspiracy as an aggravating circumstance.

• Since the chief perpetrator has been remanded in custody in the United Kingdom, the
parent firm has its head office there and most of its assets are frozen there, the European
Public Prosecutor decides on the basis of criteria for assigning priority jurisdiction to
prosecute in London. A court designated by the Unite Kingdom exercises the committal
review function. He looks into three questions: 1) Was the evidence obtained lawfully?
2) Is such evidence as was obtained lawfully sufficient to justify proceedings in the
criminal courts? 3) Do the courts for London have jurisdiction? The national committal
review court answers all these questions in the affirmative. Since we are in a common
investigation and prosecution area, the European Public Prosecutor can bring the entire
case in the London court.

• The European Public Prosecutor prosecutes for the Community offences. The national
prosecution service has the option of prosecuting for corporate income tax fraud. The
court convicts the firms, sentences them to heavy fines and confiscates their assets. It
further sentences the managers of Meat International to four years’ imprisonment and the
managers of the other firms to two years.

• The sentences passed in the London court are valid throughout the common investigation
and prosecution area. They are executed in the United Kingdom and, on the basis of the
mutual recognition principle, in Belgium, Portugal and Spain. An application is sent to
Switzerland under the existing international conventions for the confiscation of the real
estate in Lugano.

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ANNEX 4

The Questions

General Question What do you think of the general outline proposed for the European Public
Prosecutor, in particular as regards:

– his scope of action (confined to the financial dimension Community interests)?

– his powers?

– his relationship with national systems of criminal law?

Question 1 What are your views on the proposed structure and internal organisation of the
European Public Prosecutor? Should the European function conferred on the Deputy
European Public Prosecutor be an exclusive function or could it be combined with a national
function?

Question 2 For what offences should the European Public Prosecutor have jurisdiction?
Should the definitions of offences already provided for in the European Union be amplified?

Question 3 Should the establishment of the European Public Prosecutor be accompanied by
certain further common rules relating to:

– penalties?

– liability?

– limitation?

– other matters?

If so, to what extent?

Question 4 When and by whom should cases be referred to the European Public Prosecutor?

Question 5 Should the European Public Prosecutor be guided by the mandatory prosecution
principle, as proposed by the Commission, or by the discretionary prosecution principle?
What exceptions should be provided for in each of these cases?

Question 6 Given the ideas put forward in this Green Paper, how should functions be
distributed between the European Public Prosecutor and the national enforcement authorities,
notably in order to see that hybrid cases are properly treated?

Question 7 Does the proposed list of investigation measures for the European Public
Prosecutor seem to you to be adequate, particularly as a means of overcoming the
fragmentation of the European criminal-law area? What framework (applicable law, review)
should be envisaged for investigation measures?

Question 8 What solutions should be envisaged to ensure the execution of investigation
measures undertaken by the European Public Prosecutor?

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Question 9 On what terms should the European Public Prosecutor be able to take a decision to
close a case or commit it for trial?

Question 10 By what criteria should the Member State or States of trial be chosen? Should the
European Public Prosecutor’s choice be subject to review? If so, by whom?

Question 11 Do you think that the principle that evidence lawfully obtained in a Member
State should be admissible in the courts of all other Member States is such as to enable the
European Public Prosecutor to overcome the barrier raised by the diversity of rules of
evidence?

Question 12 To whom should the function of reviewing acts of investigation executed under
the authority of the European Public Prosecutor be entrusted?

Question 13 To whom should the committal review function be entrusted?

individual rights are adequately protected
Question 14 Do you feel
throughout the proposed procedure for the European Public Prosecutor? In particular, is the
double jeopardy principle properly secured?

that fundamental

Question 15 How would the relationship between the European Public Prosecutor and those
involved in cooperation in criminal matters in the European Union be best organised?

Question 16 In the run-up to the Commission’s evaluation of the rules governing OLAF, what
factors related to the relationship between the Office and the European Public Prosecutor
seem most meaningful to you?

Question 17 What type of relations should the European Public Prosecutor maintain with third
countries, and in particular applicant countries, in order to improve efforts to combat activities
which damage the Community’s financial interests?

Question 18 What procedures should be available for judicial review of acts done by the
European Public Prosecutor or under his authority in the exercise of his functions?

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