COMMUNICATION FROM THE COMMISSION TO THE EUROPEAN PARLIAMENT, THE EUROPEAN COUNCIL AND THE COUNCIL Third progress report towards an effective and genuine Security Union
Date: 2016-12-21
Institutions: Directorate-General for Migration and Home Affairs, European Commission
Subjects: European security, Schengen Information System, border control, confiscation of property, cross-border cooperation, exchange of information, external border of the EU, fight against crime, money laundering, terrorism

EN 

   EN 

   EUROPEAN COMMISSION  Brussels, 21.12.2016  COM(2016) 831 final   COMMUNICATION FROM THE COMMISSION TO THE EUROPEAN PARLIAMENT, THE EUROPEAN COUNCIL AND THE COUNCIL Third progress report towards an effective and genuine Security Union  
 
 
Third progress report towards an effective and genuine Security Union 

I.  

INTRODUCTION  

This is the third monthly report on the progress made towards building an effective and 
genuine  Security  Union  and  covers  developments  under  two  main  pillars:  tackling 
terrorism and organised crime and the means that support them; and strengthening our 
defences and building resilience against those threats. The cowardly and despicable 19 
December  Berlin  attack  and  the  other  terrible  attacks  of  2016  remind  us  again  of  our 
vulnerability  and  the  need  for  us  to  continue  working  together  to  strengthen  our 
collective  security  to  protect  our  freedoms  and  way  of  life.  Over  the  course  of  this 
reporting  period  concrete  progress  has  been  achieved  on  squeezing  the  space  in  which 
terrorists,  and  those  who  support  them,  can  act.  This  report  outlines  the  new  terrorist 
financing package adopted today, which is an important step in stemming the financial 
resources  that  sustain  terrorism.  To  further  close  down  the  space  for  terrorists,  the 
Commission is also improving information exchange,  by adopting a set of proposals to 
strengthen  the  effectiveness  and  efficiency  of  the  Schengen  Information  System. 
During  this  reporting  period,  there  has  also  been  significant  progress  on  key  EU 
legislative files to counter terrorism and organised crime, and to reinforce security at our 
borders. The European Parliament and the Council have now reached political agreement 
on the Directive on Combating Terrorism, the revision of the Firearms Directive and 
the revision of the Schengen Borders Code to allow systematic checks on EU citizens.  

Important  progress  has  also  been  made  in  the  fight  against  online  radicalisation.  The 
second high-level meeting of the EU Internet Forum delivered the announcement of a 
hash-sharing initiative from major internet platforms, enabling participating companies to 
use  "hashes"  to  detect  terrorist  content,  in  order  to  ensure  its  permanent  removal.  This 
new  tool  is  expected  to  further  restrict  the  access  of  terrorist  organisations  to  a  key 
medium  used  for  propaganda,  recruitment  and  radicalisation.  At  the  Forum,  the 
Commission  also  launched  a  Civil  Society  Empowerment  Programme,  with  €10 
million funding, to support civil society partners in ramping up the volume of effective, 
alternative on-line narratives. 

There  have  also  been  key  developments  in  a  number  of  other  fields.  Given  the  vital 
importance of full and timely implementation of the EU Passenger name Record (PNR) 
Directive, the Commission presented a PNR implementation plan to provide guidance 
to Member States. The Commission has also presented an Action plan to strengthen the 
European  response  to  travel  document  fraud.  The  Action  Plan  provides  operational 
recommendations  to  Member  States  to  tackle  the  growing  problem  of  travel  document 
fraud, including registration of identity, the issuance of documents, document production 
and  document  control.    Finally,  to  help  protect  citizens  and  critical  infrastructures,  the 
Commission  has  addressed  the  security  of  our  energy  grids  in  the  Energy  Union 
package adopted on 30 November. The package is designed to support Member States 
on risk assessments, risk preparedness and the management of crisis situations in relation 
to the Union's electricity systems.  

2 

 
 
 
 
 
 
 
II.   NEW EU LAWS TO FIGHT TERRORISM AND ORGANISED CRIME 

Terrorist offences 

Following  intensive  negotiations,  the  European  Parliament  and  the  Council  reached 
political agreement on 17 November on the Commission's December 2015 proposal for a 
Directive on combatting terrorism1. This is a crucial step in our fight against terrorists 
and  that  support  them.  The  Directive  consolidates  existing  EU  legislation  and 
international  standards2  on  the  criminalisation  of  terrorist  offences  and  incorporates 
"new"  terrorism-related  offences  including  terrorist  financing  and  travelling  abroad  to 
commit a terrorist offence or to participate in a training camp – as well as returning from 
such  activities,  providing  or  receiving  training.  It  is  a  key  element  in  the  fight  against 
foreign  terrorist  fighters.  The  Directive  also  includes  provisions  to  meet  the  specific 
needs  of  victims  of  terrorism  with  information,  support  and  protection.  The  European 
Parliament  and  the  Council  now  need  formally  to  adopt  swiftly  the  text  and  Member 
States' implementation period will be 18 months. 

Firearms control 

Following a Commission proposal in November 2015 and repeated calls to the European 
Parliament  and  Council,  a  political  agreement  was  reached  on  13th  December  2016 
between the co-legislators on the revision of the EU Firearms Directive3. This is a vital 
step  in  stopping  legal  access  to  military  grade  assault  weapons.  The  revised  Directive 
broadens  the  range  of  weapons  being  prohibited  and  thus  falling  under  the  strictest 
Category A control, including automatic weapons converted to semi-automatic and semi-
automatic weapons fitted with high capacity magazines and loading devices. In future, it 
will no longer be possible to buy or trade these weapons other than for a very narrowly 
defined  group  of  licence  holders  –  such  as  museums  or  sport  shooters  –  who  will  be 
subject to  stringent  security and monitoring  requirements. For the first time, limits will 
be  placed  on  magazine  size  for  both  long  and  short  semi-automatic  barrelled  weapons 
and all essential components of firearms will need to be marked and registered.4  

At the same time as strengthening controls on legally-held firearms, the Commission is 
working  to  reinforce  the  fight  against  illegal  firearms  trafficking,  especially  in  the 
Western  Balkans,  as  foreseen  in  the  2015-2019  Action  Plan.  The  Ministerial  meeting 
with the Western Balkans on 16 December was an important milestone on this issue and 
a joint statement was adopted by the EU and the Western Balkans countries, in order to 
highlight  the  steps  needed  to  fight  more  effectively  illegal  firearms  trafficking  both  in 
Europe and in the Western Balkans. 

The Commission has also further tightened measures on explosive precursors to make it 
even  harder  for  terrorists  to  gain  access  to  the  raw  materials  used  in  the  illicit 
manufacture  of  explosives.  Harmonised  rules  on  the  availability,  introduction, 
possession  and  use  of  substances  or  mixtures  that  could  be  misused  for  the  illicit 
manufacture  of  explosives  are  outlined  in  Regulation  (EU)  No  98/2013  to  limit  their 
availability  to  the  general  public,  and  ensure  the  appropriate  reporting  of  suspicious 

1   COM (2015) 625 final 
2  

Including the Additional Protocol to the Council of Europe Convention on the prevention of terrorism, 
and the standards of the Financial Action Task Force (FATF). 

3   COM(2006) 93 final 
4   At  the  meeting  of  COREPER  on  20  December  2016  on  the  text  agreed  by  the  co-legislators  on  the 
Firearms  Directive,  the  Commission  issued  a  declaration  regretting  that  some  parts  of  the  original 
proposal which set a greater level of ambition, in particular in proposing a complete ban of the most 
dangerous semi-automatic firearms, were not supported by the Parliament and the Council. 

3 

 
                                                 
transactions  throughout  the  supply  chain.  Three  Delegated  Regulations5  have  been 
adopted  to  control  the  use  of  explosives  precursors  on  aluminium  powder,  magnesium 
powder  and  magnesium  nitrate.  The  Regulations  place  a  strict  reporting  obligation  on 
sales of precursor substances to prevent their diversion towards the illicit manufacturing 
of homemade explosives. 

Systematic border checks 

While  third-country  nationals  are  already  subject  to  systematic  document  and  security 
checks  against  relevant  databases  upon  entry,  the  targeted  reform  of  the  Schengen 
Borders  Code6,  agreed  by  the  co-legislators  on  5  December,  introduces  mandatory 
systematic  checks  of  EU  citizens  against  relevant  databases.  In  addition,  third-country 
nationals will now also have to be checked systematically upon exit against the Schengen 
Information  System  (SIS)  and  Interpol's  Stolen  Lost  Travel  Document  database.  This 
amendment will help detect all the wanted individuals who have an alert placed on them 
– including foreign terrorist fighters.  

III.  DELIVERING ON THE ACTION PLAN TO STRENGTHEN THE FIGHT 

AGAINST TERRORIST FINANCING 

To  address  the  whole  range  of  means  used  by  terrorists  to  raise  and  move  funds,  the 
Commission  brought  forward  a  comprehensive  Action  Plan  to  strengthen  the  fight 
against  the  financing  of  terrorism  in  February  2016.7  Today,  the  Commission  has 
adopted a new package of proposals to deliver the actions it had committed to finalise by 
end  2016.  The  proposed  instruments  will  both  make  it  harder  for  criminals  to  finance 
their activities and make it easier to trace their financial transactions, stop them and bring 
them  to  justice.  The  measures  focus  on  tackling  money  laundering  and  illicit  cash 
movements linked to terrorism and crime, by improving the freezing and confiscation of 
assets,  and  by  exploring  how  to  improve  the  detection  and  tracing  of  financing 
movements of terrorists. 

1.  Criminalising money laundering and detecting illicit cash movements  

For  competent  authorities  to  be  able  to  prosecute  criminals  and  terrorists  and  get  them 
behind  bars,  they  need  adequate  criminal  law  provisions.  The  proposed  Directive  to 
criminalise  money  laundering8  will  provide  a  comprehensive  definition  of  money 
laundering  offences  and  sanctions  across  the  EU.  This  directive  will  reinforce  the 
existing framework fighting money laundering. It will also ensure that the EU meets its 
international obligations in this area, including the Warsaw Convention9, as well as the 
relevant  recommendations  from  the  Financial  Action  Task  Force  (FATF)  and  therefore 

5   C(2016) 7647 final, C(2016) 7650 final and C(2016) 7657 final 
6   COM (2015)670 final  
7   COM(2016)050 final 
8   COM(2016)826 
9   Council of Europe Convention on Laundering, Search, Seizure and Confiscation of the Proceeds from 
Crime  and  on  the  Financing  of  Terrorism  of  2005,  CETS  No  198,  [which  requests  countries  to 
criminalise  the  laundering  of  proceeds  of  a  wide  range  of  predicate  offences  (providing  a  list  of 
predicate offence categories) an to criminalise ancillary activities, while making irrelevant whether 
the  predicate  offence  was  subject  to  the  criminal  jurisdiction  of  the  country  where  the  money 
laundering  offence  took  place  and  requiring  countries  to  ensure  that  a  prior  or  simultaneous 
conviction for the predicate offence and the precise establishment of the predicate offence are not a 
prerequisite for a conviction for money laundering].  

4 

 
 
                                                 
also help address the existing obstacles to cross-border judicial and police cooperation in 
the  fight  against  money  laundering,  and  improve  enforcement.    Finally,  the  proposal 
should prevent criminals from exploiting the differences between national legislation to 
their advantage and act as an effective deterrent.  

In order to pursue these crimes effectively, competent authorities need adequate tools to 
detect  terrorists  and  their  supporters.  The  existing  Cash  Control  Regulation10  requires 
those entering or leaving the EU with EUR 10 000 or more to make a declaration to that 
effect.  However,  there  is  no  provision  for  cash  that  is  sent  in  post,  freight  or  courier 
shipments  and  competent  authorities  have  signalled  that  criminals  have  resorted  to 
sending or receiving cash via such shipments in order to escape the obligation to make a 
declaration under the Regulation.  

Furthermore,  the  Cash  Control  Regulation  requires  only  that  declaration  data  be  ‘made 
available’  by  the  competent  authorities  to  the  financial  intelligence  unit  (FIU)  of  the 
Member State in which it was collected. This somewhat passive requirement can be met 
by  simply  making  completed  declaration  forms  available  for  inspection  by  the  FIU. 
However,  this  is  not  sufficient  as  the  information  should  be  actively  transmitted  to  the 
FIU in order to enable them to analyse it. Also, declaration data can be exchanged with 
competent authorities of other Member States only where there are indications of illegal 
activity and even then it is optional. This has given rise to inconsistent implementation 
and little systematic sharing of data. 

The current Regulation also does not  allow authorities to detain cash temporarily when 
they  detect  movements  of  sub-threshold  amounts  in  relation  to  which  there  are 
indications of illegal activity. Issues have also been raised around the imperfect definition 
of  'cash'.  And  the  levels  of  implementation  of  the  existing  rules  differ  widely  among 
Member States. 

For  all  these  reasons,  the  proposed  Regulation  to  tackle  illicit  cash  movements11 
extends  the  scope  of  the  existing  Cash  Control  Regulation  to  include  cash  shipped  by 
freight or post and will allow authorities to act upon lower amounts of cash where there 
are  suspicions  of  illicit activity.    The  proposal  also  extends  the  obligation  to  declare  to 
gold  (in  forms  usable  as  highly  liquid  stores  of  value)  and  foresees  a  system  of 
declaration  on  demand  (a  so-called  'disclosure'  system)  for  cash  moved  by  post  and 
freight. 

2.  Asset freezing  

Asset  freezing  is  an  effective  tool  to  prevent  terrorists  using  and  receiving  funds  and 
hindering their capacity to operate. Effective confiscation disrupts the sources of revenue 
of  terrorist  organisations  in  the  long  term  and  deprives  criminals  from  profiting  from 
their illegally obtained assets.  

10   http://eur-lex.europa.eu/LexUriServ/LexUriServ.do?uri=OJ:L:2005:309:0009:0012:EN:PDF 
11  COM(2016)819 

5 

 
 
 
 
                                                 
Freezing and confiscation measures in judicial proceedings  

One of the ways of doing this is to freeze and confiscate criminal assets in the course of 
judicial proceedings. This disrupts the sources of revenue of terrorist organisations in the 
long term and deprives criminals from using their illegally obtained assets.  

To  complement  the  2014  Directive  on  confiscation  and  freezing12  (which  establishes 
minimum rules on the freezing and confiscation of criminal assets) and also the recently 
agreed  Directive  on  Combatting  Terrorism  (which  includes  a  self-standing  criminal 
offence  of  terrorist  financing),  the  Commission  has  proposed  a  Regulation  on  the 
mutual  recognition  of  criminal  asset  freezing  and  confiscation  orders13.  This 
proposal will allow for more efficient cross-border freezing and confiscation of criminal 
assets  issued  in  the  framework  of  criminal  proceedings,  without  any  intermediate 
formalities. Taken together, these instruments will increase the possibilities to freeze and 
confiscate assets related to terrorism and crime by means of a judicial decision. This is 
particularly important, since judicial asset freezing in the context of criminal proceedings 
provides more safeguards than administrative asset freezing.  

Administrative asset freezing 

When financial transactions linked to terrorism and crime are detected, public authorities 
can  trace  them  and  if  necessary,  block  these  and  freeze  the  corresponding  assets. 
Administrative  asset  freezing  is  a  temporary  tool  of  a  preventive  nature  that  can  be 
applied in the absence of criminal proceedings to prevent suspected terrorists from using 
and receiving funds.  

The Financial Action Task Force (FATF) requires Member States to have provisions in 
place to freeze without delay the assets of persons or entities with links to terrorism.  The 
absence of asset freezing regimes in a small number of Member States as well as the fact 
that  some  of  the  existing  national  regimes  are  not  complete  or  effective  have  raised 
questions  as  regards  the  full  compliance  with  international  requirements.  In  a  recent 
analysis14,  the  FATF  considers  that  14  EU  Member  States  are  not  able  to  apply  asset 
freezing measures to what the FATF calls "EU internal terrorists"15.  Following the entry 
into  force  of  the  Lisbon  Treaty,  the  EU  acquired  explicit  competence  via  Article  75 
TFEU to adopt administrative measures against individuals and legal persons, groups and 
non-state  entities  where  necessary  to  achieve  the  objectives  of  the  area  of  freedom, 
security  and justice. The  Commission  committed in  the  February  Action  Plan  to  assess 
the  need  for  a  supplementary  administrative  system  for  freezing  the  assets  of  terrorists 
within the EU.   

In  terms  of  the  current  security  threat  in  Europe,  today,  the  biggest  threat  to  European 
security  remains  jihadi-inspired  terrorism16,  while  the  assessment  of  the  overall  threat 
from  other  terrorist  groups  -  with  very  few  exceptions  -  remains  low17.    Therefore,  the 

12   Directive 2014/42/EU on the freezing and confiscation of instrumentalities and proceeds of crime in 

the European Union 

13   COM(2016) 826 
14   Results of the TF Fact-Finding Initiative, FATF/PLEN(2015)36 
15   However,  the  Commission  considers  that  there  are  no  grounds  in  national  or  international  law  to 

distinguish between internal and international terrorism. 
16  
"Changes in Modus Operandi of IS revisited"; Europol, 2 December 2016 
17   European Union Terrorism Situation and Trend Report (TE-SAT) 2016, Europol 

6 

 
                                                 
added  value  in  terms  of  law  enforcement  and  the  fight  against  terrorism  of  a  system 
under Article 75 TFEU is for the time being considered to be low. 

Moreover,  the  current  threat  emanating  from  international  terrorism  is  covered  by 
existing  provisions  under  EU  law.  The  EU  asset  freezing  regimes  adopted  under 
Common  Foreign  and  Security  Policy  (CFSP)  enable  the  freezing  of  funds  and  other 
assets linked to terrorism. These regimes have recently been upgraded and allow for the 
first time the autonomous establishment of a number of measures including the freezing 
of assets of persons linked to ISIL (Da'esh) and Al Qaeda18. The new system allows for 
the  blocking  of  the  funds  of  persons  and  entities associated with  these  organisations or 
participating  in  activities  such  as  financing,  training,  recruiting,  inciting  to  commit 
terrorist  acts,  as  well  as  travelling  outside  or  into  the  EU  to  participate  in  activities  of 
ISIL (Da'esh) or Al Qaeda. These regimes apply to third country nationals as well as to 
EU citizens, as far as they have a link to international terrorism. This means the EU can 
block the assets  of any terrorist operating in  Europe insofar as  they have links to  these 
groups.  

For  other  groups  operating  in  the  EU,  the  reinforced  criminal  law  framework  provides 
more  options  to  block  funds  linked  to  terrorism  than  in  the  past,  with  more  safeguards 
than administrative asset freezing while still enabling quick and effective action. 

Taking into account the limited additional value in terms of law enforcement activities of 
a new regime adopted under Article 75 TFEU, that existing instruments already cover the 
needs  arising  from  current  threats,  and  the  increased  possibilities  in  the  context  of  EU 
criminal  law  to  freeze  assets  related  to  terrorism,  the  Commission  does  not  consider  it 
necessary  to  take  further  steps  at  this  point  in  time.  However,  the  Commission  will 
continue to monitor the evolution of the terrorist threat within the EU very closely and 
will review the necessity of introducing measures on the basis of Article 75 TFEU on a 
regular basis. 

3.  Tracking terrorist financing  

The Action Plan on Terrorist Financing highlighted that when it comes to detecting the 
movement  of  funds  through  financial  transactions  or  the  identification  of  terrorist 
networks  and  affiliates,  both  Financial  Intelligence  Units  (FIUs)  and  tracking  systems 
such  as  the  EU-US  Terrorist  Financing  Tracking  Programme  (TFTP)  are  key  tools. 
However,  existing capacities  should be  reinforced to focus both  on complex and large-
scale funding operations, and on "low cost" terrorist operations which use new modes of 
payment  which  are  difficult  to  track.  The  speed  of  reaction  is  also  essential,  as  current 
financial services allow terrorists to move funds very rapidly from one place to the other, 
This clearly  shows the need to improve cooperation and  exchange of financial  and law 
enforcement  intelligence.  Tracking  of  international  transactions  through  the  EU-US 
to  function 
Terrorist  Finance  Tracking  Programme  (TFTP)  agreement  appears 
effectively.  Following  an  impact  assessment,  a  Commission  Communication  of 
November  2013  concluded  that  setting  up  an  EU-based  system  (referred  to  as  TFTS, 

18   Council  Decision  (CFSP)  2016/1693  concerning  restrictive  measures  against  ISIL  (Da'esh)  and  Al-
Qaeda and persons, groups, undertakings and entities associated with them, and repealing Common 
Position  2002/402/CFSP,  and  Council  Regulation  (EU)  2016/1686  of  20  September  2016  imposing 
additional  restrictive  measures  directed  against  ISIL  (Da'esh)  and  Al-Qaeda  and  natural  and  legal 
persons, entities or bodies associated with them. 

7 

 
                                                 
Terrorist Finance Tracking System) duplicating the TFTP would not be proportionate or 
bring added value.  

However, given the rapidly evolving pattern of terrorist financing, it would nevertheless 
be worthwhile to analyse the need for complementary mechanisms to the EU-US TFTP 
to  fill  any  potential  gaps  (i.e.  transactions  which  are  excluded  from  the  EU-US  TFTP 
agreement  –  notably  intra-EU  payments  in  euro  –  and  may  not  be  possible  to  track 
otherwise). 

First,  since  2013,  the  situation  has  evolved:  the  terrorist  threat  has  shifted  and  the 
financial  resources  used  by  terrorists  are  often  smaller  and  do  not  necessarily  transit 
through transfer systems such as the one covered by EU-US TFTP. Many new means of 
payment have also emerged offering new ways for terrorists to finance themselves.  

Discussions  with  Europol  and  Member  States  suggest  that  a  European  system 
complementing EU-US TFTP could provide competent authorities with a more complete 
picture  of  relevant  financial  transactions  that  are  currently  missing,  without  having  to 
consult numerous databases (mostly limited to information held at national level) and the 
related  risk  of  possibly  overlooking  crucial  information.  It  would  also  enable  cross-
checking of that information with the authorities of other Member States. Combined with 
other intelligence, it could help to identify suspects earlier in an investigation with a view 
to  preventing  attacks,  provide  useful  intelligence  right  after  an  attack,  allow  faster 
identification of the perpetrators and their supporters, and provide important evidence for 
the prosecution of terrorists.  

However,  the  added  value  of  a  European  complementary  system  would  need  to  be 
weighed  against  other  considerations.  This  would  need  to  include  notably:  (i)  an 
assessment of the  risks of a particular channel to be used for terrorist financing, and the 
proportionality  of  the  measure  envisaged;  (ii)  the  technical  complexity,  feasibility  and 
costs of collecting and processing large amounts of data from a wide range of entities and 
the  economic  impact  on  these  entities;  and  and  (iii)    the  impact  on  fundamental  rights, 
notably the protection of private life and the right to the protection of personal data.   

A  key  issue  would  be  the  scope  of  such  a  system,  notably  which  payment  and  money 
transfer  services  could  be  included  and  which  entities  holding  financing  information 
could be required to provide information to this system.  

Limiting  the  scope  to  Single  European  Payments  Area  (SEPA)  wire  transfers  could 
already provide some added value in terms of law enforcement: the majority of terrorist 
cells located in Europe have derived some income from legal sources – usually received 
through  the  formal  banking  system  –  and  use  bank  accounts  and  credit  cards  both  for 
their  everyday  economic  activities  and  for  attack-related  expenses.  The  potential 
providers of data would be financial message services providers and automated clearing 
houses,  but  could  also  include  credit  institutions.  However,  while  a  system  covering 
SEPA  transfers  would  benefit  from  an  existing  regulatory  framework  and  common 
standards, it would exclude transactions across the EU in currencies other than the euro 
and using other means of payment. 

Extending  the  scope  to  cover  transfers  in  other  currencies  as  well  as  payments  with 
credit,  debit  and  pre-paid  cards,  e-wallet  providers,  money  remittances  or  virtual 
currencies  could  further  increase  the  added  value  in  terms  of  law  enforcement.  At  the 
same time, it would involve a significant additional amount of data and providers, which 
could have a further significant impact on the costs of the system and its proportionality.  

8 

 
In  light  of  these  considerations,  the  Commission  will  continue  its  assessment  and  will 
consider options to set up a European system to track terrorist financing, complementary 
to  the  existing  TFTP,  including  the  impact  of  these  options  on  fundamental  rights. 
Considering  the  technical  and  legal  complexity  of  the  issues  involved,  detailed 
consultation  with  financial  services  providers  will  be  necessary.  The  Commission  will 
report on its findings in the summer of 2017. 

Looking ahead, the work to fully deliver the Action Plan to strengthen the fight against 
terrorist  financing  will  continue  in  2017,  notably  on  the  possibility  to  reinforce  the 
powers of customs authorities to fight against terrorism financing, presenting a proposal 
to address terrorism financing through trade in goods and illicit trade in cultural goods, 
and examining possibilities to extend law enforcement and other public authorities access 
to bank account registers. The Commission is encouraging co-legislators to prioritise the 
legislative  files  already  presented  and  to  reach  agreement  on  the  revised  4th  Money 
Laundering Directive without further delay19.  

IV.   STRENGTHENING 
BLIND SPOTS  

INFORMATION  SYSTEMS  AND  TACKLING 

Effective  and  systematic  information  exchange  between  Member  States  and  strong, 
interconnected  information  systems  are  key  tools  in  strengthening  our  defences  against 
terrorism and organised crime. The Commission is driving this work forward by ensuring 
better implementation by Member States of existing instruments, and by accelerating its 
work  towards  stronger  and  smarter  information  systems  for  borders  and  security  as 
initiated  in  April  2016.20  This  aims  to  ensure  that  competent  authorities  systematically 
have  the  necessary  information  from  different  information  systems  at  their  disposal  to 
address current security challenges. 

A  key  aspect  of  improving  information  management  at  EU  level  is  to  address 
shortcomings  in  existing  systems  and  to  optimise  their  performance.  To  that  end,  the 
Commission presented a set of proposals to strengthen the effectiveness and efficiency of 
the  Schengen  Information  System  (SIS)  as  the  most  important  and  widely  used 
information-sharing  instrument  today.21  Based  on  a  comprehensive  evaluation,  the 
Commission's new proposals22 seek to improve the functionalities of the system to meet 
new operational needs. 

The  proposal  will  improve  and  extend  the  use  of  SIS  and  its  added  value  for  law 
enforcement and strengthen the access rights of competent EU Agencies such as Europol 
and  Eurojust.  It  will  extend  some  of  the  existing  alert  categories  and  types  of  checks, 
introducing a new alert category on "unknown wanted persons" and a preventive alert on 
children at high risk of abduction. It will also introduce an obligation to create a SIS alert 
in case a person is sought in relation to a terrorist offence. The proposal will also improve 
the enforcement of return decisions issued to irregularly staying third-country nationals 
by introducing a new alert category for return decisions. Moreover, it will contribute to 
the effective enforcement of entry bans for third-country nationals at the external border 
by  making  their  introduction  in  the  SIS  compulsory.  The  proposal  will  provide  new 

19   https://ec.europa.eu/priorities/sites/beta-political/files/joint-declaration-legislative-priorities-

2017_en.pdf 

20   See  the  Communication  on  "Stronger  and  Smarter  Information  Systems  for  Borders  and  Security", 

COM(2016) 205 final of 6.4.2016. 

21   In 2015, national competent authorities checked persons and objects against data held in SIS on nearly 

2.9 billion occasions and exchanged over 1.8 million pieces of supplementary information. 

22   COM(2016) 883 

9 

 
                                                 
functionalities to the system, such as a more effective use of data such as facial imaging 
and fingerprints. It will also enhance data security and the quality of the data recorded in 
SIS, for example by providing for uniform requirements to officers on the ground on how 
to process SIS data in a secure way. 

The  proposal  will  strengthen  data  protection  by  introducing  additional  safeguards  to 
ensure  that  the  collection,  processing  and  access  to  data  is  limited  to  what  is  strictly 
necessary, in full respect of EU legislation and fundamental rights, including the right to 
effective remedies. 

In addition to improving the functioning of existing systems, work will also continue on 
how information systems interact with each other. President Juncker's State of the Union 
address  in  September  2016  and  the  European  Council  conclusions  of  December  2016 
refer  to  the  importance  of  overcoming  the  current  shortcomings  in  information 
management  and  of  improving  the  interoperability  and  interconnection  between 
existing  information  systems.  The  Commission's  High  Level  Expert  Group  on 
Information Systems and Interoperability is assessing options to achieve this. The High 
Level  Expert  Group  multi-disciplinary  and  multi-agency  cooperation  approach  as 
outlined  by  the  European  Agenda  on  Security,  including  possible  synergies  with 
information  systems  for  border  management  and  law  enforcement  and  customs 
authorities as set out in the EU Customs Union governance. 

In order to accelerate delivery the High Level Expert Group on Information Systems 
and  Interoperability  presented,  on  21 December,  a  chairman's  interim  report  with  a 
proposal  to  create  a  single  search  portal  allowing  law  enforcement  and  border 
management  authorities  on  the  ground  to  search  simultaneously  existing  EU  databases 
and  information  systems.  Member  States'  competent  authorities  would  also  be  able  to 
conduct  such  simultaneous  searches  with  Europol's  databases,  thanks  to  a  system 
interface that Europol is developing with Member States. The report also highlights the 
importance of data quality and makes recommendations to improve the quality of data in 
EU systems.  

The High Level Expert Group will present its final report in the first half of 2017. Based 
on  these  findings  and  discussions  with  the  European  Parliament  and  the  Council,  the 
Commission  will  consider  measures  to  further  boost  the  interoperability  of  EU 
information  systems  and  increase  their  effectiveness  to  address  the  current  security 
threats.  

IV. CONCLUSION 

The  Commission  will  continue  to  drive  forward  work  on  the  implementation  of  the 
European Agenda on Security, towards an effective and genuine Security Union, and will 
report on further progress in January. The report in January will focus on strengthening 
our  defences  –  including  taking  forward  the  interim  report  of  the  High  Level  Experts 
Group on information systems and interoperability.  

10