REPORT FROM THE COMMISSION TO THE EUROPEAN PARLIAMENT AND THE COUNCIL on the implementation of Directive (EU) 2017/1371 of the European Parliament and of the Council of 5 July 2017 on the fight against fraud to the Union's financial interests by means of criminal law
Date: 2021-09-06
Institutions: Directorate-General for Justice and Consumers, European Commission
Subjects: criminal law, fraud against the EU, general budget (EU), judicial cooperation in criminal matters in the EU, offence, penalty, sanction (EU)

EN 

  EN 

   EUROPEAN COMMISSION  Brussels, 6.9.2021  COM(2021) 536 final  REPORT FROM THE COMMISSION TO THE EUROPEAN PARLIAMENT AND THE COUNCIL on the implementation of Directive (EU) 2017/1371 of the European Parliament and of the Council of 5 July 2017 on the fight against fraud to the Union's financial interests by means of criminal law                
 
 
1.  INTRODUCTION  

1.1. Background  

Directive (EU) 2017/1371 of the European Parliament and of the Council on the fight against 
fraud  to  the  Union’s  financial  interests  by  means  of  criminal  law  (the  ‘PIF  Directive’)  was 
adopted  on  5 July 20171  as  part  of  the  Commission’s  overall  anti-fraud  strategy2.  For  the 
Member States bound by it3, the PIF Directive replaces the 1995 Convention on the protection 
of the European Communities’ financial interests and its protocols (‘the PIF Convention’)4.  

Based on Article 83(2) of the Treaty on the Functioning of the European Union (TFEU), the 
PIF  Directive  sets  common  standards  for  Member  States’  criminal  laws.  These  common 
standards  seek  to  protect  the  EU’s  financial  interests  by  harmonising  the  definitions, 
sanctions, and limitation periods of certain criminal offences affecting those interests. These 
criminal  offences  (the  ‘PIF  offences’)  are:  (i)  fraud,  including  cross-border  value  added  tax 
(VAT) fraud involving total damage of at least  EUR 10 million; (ii) corruption; (iii) money 
laundering;  and  (iv)  misappropriation.  This  harmonisation  also  affects  the  scope  of 
investigations and prosecutions by the European Public Prosecutor’s Office (EPPO)5, because 
the EPPO’s powers are defined by reference to the PIF Directive6, as implemented by national 
law.  The  PIF  Directive  also  facilitates  the  recovery  of  misused  EU  funds7  by  means  of 
criminal law. 

The deadline for transposition of the Directive into national law expired on 6 July 2019. Only 
12 Member States had notified full transposition of the Directive by that date. Therefore, the 
Commission  launched  infringement  procedures  against  the  remaining  14  participating 
Member States by sending them letters of formal notice in September 2019. As of April 2021, 
the  number  of  notified  complete  transpositions  had  gone  up  to  26,  which  means  that  all 
Member States bound by  the Directive have now notified its  full transposition into national 
law.  

1 OJ L 198, 28.7.2017, pp. 29-41.  
2 Commission Anti-Fraud Strategy: enhanced action to protect the EU budget, COM (2019) 196 final, 29.4.2019. 
3 In accordance with Protocol 22 to the Treaties, Denmark did not take part in the adoption of the PIF Directive and 
is therefore not bound by it or subject to its application. However, Denmark remains bound by the PIF Convention. 
Ireland, on the other hand, did exercise its right to take part in the adoption and application of the PIF Directive in 
accordance with Protocol 21 to the Treaties. 
4  Convention  drawn  up  on  the  basis  of  Article  K.3  of  the  Treaty  on  European  Union,  on  the  protection  of  the 
European Communities’ financial interests, OJ C 316, 27.11.1995, pp. 49-57.  
5 Council Regulation (EU) 2017/1939 of 12 October 2017 implementing enhanced cooperation on the establishment 
of the European Public Prosecutor’s Office (‘the EPPO’), OJ L 283, 31.10.2017, pp. 1-71. 
6 Article 22(1) of Regulation (EU) 2017/1939. 
7 In this regard, the number of irregularities reported as fraudulent (which includes cases of suspected or established 
fraud) and the associated amounts are not a direct indicator of the level of fraud affecting the EU budget. They are, 
first and foremost, an indication of the level of detection and reporting of potential fraud by Member States and EU 
bodies. In 2019, 939 irregularities were reported as fraudulent, involving about EUR 461.4 million (Report from the 
Commission  to  the  European  Parliament  and  the  Council,  31st  Annual  Report  on  the protection  of  the European 
Union’s financial interests —Fight against fraud – 2019, COM(2020) 363 final, 3.9.2020, p. 13). 

 
 
 
 
                                                           
1.2. Main aspects of the PIF Directive 

Article 1 sets out the subject matter of the PIF Directive, while Article 2 sets out its scope and 
provides a definition of the notion of ‘Union’s financial interests’. In  addition, the Directive 
obliges the Member States: 

• 

• 

• 

• 

• 

• 

• 

• 

• 

to  criminalise  fraud  affecting  the  EU’s  financial  interests,  both  in  respect  of  any  act  or 
omission  relating  to:  (i)  procurement-related  expenditure  and  non-procurement-related 
expenditure; and (ii) revenue arising from VAT own resources and revenue other than that 
arising from VAT own resources (Article 3); 
to criminalise other offences affecting the Union’s financial interests (money laundering, 
corruption and misappropriation) and to define ‘public official’ with a view to protecting 
Union funds adequately from corruption and misappropriation (Article 4); 
to  criminalise:  (i)  incitement,  aiding  and  abetting  of  any  of  the  offences  referred  to  in 
Articles  3  and  4;  and  (ii)  the  attempt  to  commit  those  offences  referred  to  in  Articles  3 
(fraud) and 4(3) (misappropriation) (Article 5);  
to provide for the liability of, and sanctions for: (i) legal persons for any of the criminal 
offences  referred  to  in  Articles  3,  4  and  5  committed  for  their  benefit  by  other  persons 
having a leading position within the legal person; or (ii) due to the lack of supervision or 
control of these other persons, by any person under their authority (Articles 6 and 9);  
to draw up minimum rules on criminal penalties for natural persons, including minimum-
maximum sanctions for the criminal offences referred to in  Articles 3 and 4 when these 
offences involve considerable damage or advantage (Article 7);  
to  take  the  necessary  measures  to  ensure  that,  where  a  criminal  offence  referred  to  in 
Articles 3, 4 or 5 is committed within a criminal organisation, this will be considered to be 
an aggravating circumstance (Article 8); 
to: (i) establish their jurisdiction over the criminal offences referred to in Articles 3, 4 and 
5 where the offence is committed in whole or in part within their territory or the offender 
is one of their nationals, and where the offender is subject to the Staff Regulations at the 
time of the criminal offence;8 and (ii) avoid making the exercise of jurisdiction over PIF 
offences committed abroad by their nationals subject to certain conditions (Article 11);  
to:  (i)  prescribe  limitation  periods  for  a  sufficient  period  of  time  after  committing  the 
criminal offences referred to in Articles 3, 4 and 5, in order for those criminal offences to 
be  tackled  effectively,  with  minimum  limitation  periods  applying  to  those  offences  that 
are punishable by a maximum sanction of at least 4 years of imprisonment; and (ii) take 
the necessary measures to enable penalties to be enforced (Article 12); and  
to provide statistical data on criminal proceedings for the criminal offences referred to in 
Articles 3, 4 and 5, and their outcome (Article 18(2)). 

8  In  accordance  with  Article  11(2),  Member  States  may  refrain  from  applying  this  rule,  or  may  apply  it  only  in 
specific  cases  or  only  where  specific  conditions  are  fulfilled,  and  must  inform  the  Commission  if  they  take  this 
course of action. 

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1.3. Scope and methodology of the report 

Based on Article 18(1) of the PIF Directive, this report assesses the extent to which Member 
States have taken the necessary measures to comply with the PIF Directive. In particular, this 
report assesses whether Member States have implemented the Directive and whether national 
legislation  achieves  the  objectives  and  fulfils  the  requirements  of  the  Directive.  The  report 
does  not  affect  the  powers  of  the  Commission  under  Articles  258  TFEU  to  assess  the 
compliance of individual national transposition measures.  

This  assessment  is  primarily  based  on  the  information  that  Member  States  provided  to  the 
Commission  through  their  notification  of  national  measures  transposing  the  PIF  Directive. 
This information was complemented by external research commissioned by DG JUST under 
its framework contract. On the basis of this assessment, the Commission launched systematic 
exchanges with the Member States. The further information and explanations provided by the 
Member  States  during  these  exchanges  allowed  the  Commission  to  refine  its  analysis  as 
regards the most pertinent conformity issues. These issues will be presented in more detail in 
Sections 2 and 3 below. 

2. GENERAL ASSESSMENT  

The Commission’s objective is to ensure that all Member States have transposed the Directive 
in  a  clear,  precise  and  correct  manner,  by  setting  effective,  proportionate  and  dissuasive 
criminal penalties to protect the Union’s financial interests.  

A  detailed  assessment  of  notified  transposition  measures  confirmed  that  all  Member  States 
have  transposed  the  PIF  Directive’s  main  provisions.  However,  there  are  outstanding 
conformity issues to be addressed, including issues that must be addressed to enable effective 
investigations and prosecutions by the EPPO. Conformity issues mostly concern deficiencies 
in national legislation transposing the criminal definitions in Articles 3, 4 and 5 for:  

 

 

 

 

the definition of fraud affecting the Union’s financial interests (Article 3) in about half 
of the Member States; 
the definition of aspects of Article 4(1) (money laundering), Article 4(2) (corruption) 
and Article 4(3) (misappropriation) in several Member States;  
the definition of ‘public official’ (Article 4(4)) in about a half of the Member States; 
and  
incitement, aiding and abetting of any of the offences referred to in Articles 3 and 4; 
and the attempt to commit those offences referred to in Articles 3 and 4(3) (Article 5) 
in a few Member States. 

In  addition,  the  Commission  identified  a  number  of  conformity  issues  in  a  quarter  of  the 
Member States in relation to the liability of legal persons and sanctions for natural persons in 
accordance  with  Articles  6,  7  and  9.  For  sanctions  on  natural  persons  (Article  7),  the 
Commission  also  identified  conformity  issues  in  a  quarter  of  the  Member  States.  Some  of 

2  

 
  
 
 
 
these  issues  may  undermine  the  effective,  dissuasive  and  proportionate  character  of  these 
sanctions. 

The Commission also identified conformity issues in a few Member States in relation to the 
exercise of jurisdiction based on the territoriality principle and the active personality principle 
(Article 11(1)). Moreover, a few Member States  place conditions  on the  prosecution of PIF 
offences that are not in conformity with Article 11(4). A transposition issue with Article 12 
identified  in  some  Member  States  relates  to  the  provision  for  a  limitation  period  for  the 
execution of a judgment imposed following a final conviction for a criminal offence referred 
to in Articles 3, 4 or 5 that is shorter than the 5 years required by the PIF Directive.  

Finally,  based  on  the  information  shared,  the  Commission  discovered  that  an  explicit  and 
specific,  annual  obligation  to  report  statistical  data  to  the  European  Commission  (Article 
18(2)) is contained in the legislation of only a few Member States. In the absence of sufficient 
data,  it  might  be  more  difficult  for  the  Commission  at  a  later  stage  to  assess  whether  the 
Directive  achieved  its  general  objective  of  strengthening  the  protection  of  the  Union’s 
financial interests and whether (certain aspects of) the Directive will need to be reviewed9.  

3. SPECIFIC POINTS OF ASSESSMENT  

3.1. Definitions and scope (Article 2)  

Article  2(1)  of  the  PIF  Directive  defines  ‘Union’s  financial  interests’  and  ‘legal  person’. 
Moreover, Article 2(2) sets a threshold for the applicability of the Directive to revenue arising 
from VAT own resources. The PIF Directive only applies in cases of serious offences against 
the common VAT system. Offences against the common VAT system must be considered to 
be  serious  where  the  intentional  acts  or  omissions  laid  down  in  Article  3(2)(d)  of  the  PIF 
Directive  are  connected  with  the  territory  of  two  or  more  Member  States  of  the  Union  and 
involve total damage of at least EUR 10 million.  

This  threshold  is  mostly  aimed  at  capturing  carrousel  fraud,  VAT  fraud  through  missing 
traders,  and  VAT  fraud  committed  within  a  criminal  organisation,  all  three  of  which  create 
serious  threats  to  the  common  VAT  system  and  thus  to  the  Union  budget.  In  one  Member 
State, Article 2(1) has not been transposed in conformity with the Directive. 

3.2. Fraud (Article 3) 

Article 3 of the PIF Directive states that Member States must take the necessary measures to 
ensure that fraud affecting the Union’s financial interests constitutes a criminal offence when 
committed intentionally. For that  purpose, it sets out four categories of conduct constituting 
fraud  affecting  the  Union’s  financial  interests.  These  four  categories  relate  to  acts  or 
omissions  concerning:  (i)  non-procurement-related  expenditure  (Article  3(2)(a));  (ii) 
procurement-related  expenditure  (Article  3(2)(b));  (iii)  revenue  other  than  revenue  arising 

9 Articles 18(3) and 18(4). 

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from VAT own resources (Article 3(2)(c)); and (iv) revenue arising from VAT own resources 
(Article 3(2)(d)), as described in Section 3.1 above. 

In  roughly  half  of  the  Member  States,  the  Commission  identified  conformity  issues  in  the 
transposition of the main aspects of these offences. In particular, the Commission identified 
conformity issues in the more narrow scope of national legislation dealing with fraud related 
to  non-procurement-related  expenditure  (Article  3(2)  (a))  and  fraud  related  to  procurement-
related  expenditure  (Article  3(2)(b)).  Other  issues  relate  to  the  transposition  of  any  act  or 
omission relating to:  

 

 

 

‘the use of false, incorrect or incomplete statements’ only covering written documents and 
‘assets  from  the  Union  budget  or  budgets  managed  by  the  Union,  or  on  its  behalf’  not 
being covered; 
‘non-disclosure  of  information’,  which  is  either  not  transposed  or  transposed  by  a  more 
limited notion; and 
‘the misapplication of such funds or assets for purposes other than those for which they 
were originally granted’ being transposed by narrower wording. 

For  revenue  other  than  revenue  arising  from  VAT  own  resources  (Article  3(2)(c))  and 
revenue  arising  from  VAT  own  resources  (Article  3(2)(d)),  the  Commission  also  identified 
conformity  issues,  again  due  to  the  more  narrow  scope  of  national  legislation.  Other  issues 
relate to the transposition of any act or omission relating to:  

 

 
 
 

 

 

‘false,  incorrect  or  incomplete  statements  or  documents’  and  ‘false,  incorrect  or 
incomplete VAT-related statements or documents’ not being covered;  
‘resources of the Union budget’ being transposed by a more limited notion; 
‘budgets managed by the Union, or on its behalf’ not being covered;  
‘non-disclosure  of  information’  and  ‘non-disclosure  of  VAT-related  information’  either 
not transposed or transposed by a more limited notion; 
‘misapplication of a legally obtained benefit’ being transposed by more narrow wording; 
and 
‘the  presentation  of  correct  VAT-related  statements  for  the  purposes  of  fraudulently 
disguising  the  non-payment  or  wrongful  creation  of  rights  to  VAT  refunds’  either  not 
transposed or transposed by a more limited notion. 

3.3. Other related offences (Article 4)  

3.3.1. Money laundering, corruption and misappropriation (Articles 4(1), 4(2) and 4(3)) 

Article 4(1) of the PIF Directive states that Member States must take the necessary measures 
to  ensure  that  money  laundering  as  described  in  Article  1(3)  of  Directive  (EU)  2015/84910 
involving property derived from the criminal offences covered by the Directive constitutes a 

10 Directive (EU) 2015/849 of the European Parliament and of the Council of 20 May 2015 on the prevention of the 
use of the financial system for the purposes of money laundering or terrorist financing, amending Regulation (EU) 
No 648/2012 of the European Parliament and of the Council, and repealing Directive 2005/60/EC of the European 
Parliament  and  of  the  Council  and  Commission  Directive  2006/70/EC  (Text  with  EEA  relevance),  OJ  L  141, 
5.6.2015, pp. 73-117. 

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criminal offence. In several Member States, this provision has not been fully transposed, due 
either  to  some  deficiencies  in  the  definition  of  money  laundering  itself  or  to  the  lack  of  a 
criminal offence covered by the PIF Directive among the predicate offences. 

Moreover,  under  Article  4(2)  of  the  Directive,  Member  States  must  take  the  necessary 
measures  to  ensure  that  passive  and  active  corruption,  when  committed  intentionally, 
constitute  criminal  offences.  In  several  Member  States,  an  additional  aspect  –  ‘breach  of 
duties’ – is required in both active and passive corruption. This additional aspect significantly 
narrows the scope of the PIF Directive’s definitions of corruption and makes its prosecution 
dependent on proving such a breach of duty.  

On  ‘passive  corruption’,  a  conformity  issue  concerns  one  of  the  aspects  of  the  offence, 
namely: ‘refrain[ing] from acting in accordance with his duty’. In a small number of Member 
States,  this  aspect  is  not  covered  by  national  legislation.  On  ‘active  corruption’,  conformity 
issues relate to the scope of the definition, as some of the aspects (‘promises, offers or gives, 
directly or through an intermediary, an advantage’ and ‘for a third party’) are missing or not 
transposed correctly in some Member States.  

Furthermore, Article 4(3) of the Directive states that Member States must take the necessary 
measures  to  ensure  that  misappropriation,  when  committed  intentionally,  constitutes  a 
criminal offence. Conformity issues concern a more narrow transposition of this offence or a 
lack of transposition altogether. 

3.3.2. Public officials (Article 4(4))  

Article 4(4) provides  a  definition of ‘public official’ with  a view to  protecting Union funds 
adequately  from  corruption  and  misappropriation.  Some  aspects  of  the  definition  of  ‘public 
official’ have not been transposed into the legislation of about half of the Member States. The 
Commission identified conformity issues in this area relating to: 

  a lack of coverage of ‘national official of another Member State and any national official 

 

of a third country’ generally or as regards the offence of misappropriation only;  
the definition of ‘Union official’ not including: (i) persons ‘seconded to the Union by a 
Member State or by any public or private body, who carries out functions equivalent to 
those performed by Union officials or other servants’; or (ii) the ‘Members of the Union 
institutions, bodies, offices and agencies, set up in accordance with the Treaties and the 
staff of such bodies’;  

  subjecting  the  definition  of  ‘national  official’  to  additional  conditions,  only  covering 
public officials of other Member States  when the crime has been committed within the 
territory  of  that  Member  State,11  and  a  lack  of  coverage  of  ‘any  person  holding  an 
executive,  administrative  …  office’ generally,  or  in  relation  to  the  offence  of 
misappropriation only; 

11 This means that Member State A would only prosecute officials of other Member States (B, C etc.) if they commit a 
crime within the territory of Member State A. 

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  Finally,  Article  4(4)(b)  referring  to  ‘any  other  person  assigned  and  exercising  a  public 

service function’, has not been transposed in some Member States. 

3.4. Inchoate offences (Article 5)  

Article 5 of the PIF Directive states that: (i) Member States must take the necessary measures 
to ensure that inciting, and aiding and abetting the commission of any of the criminal offences 
referred  to  in  Articles  3  and  4  of  the  Directive  are  punishable  as  criminal  offences  (Article 
5(1)); and (ii) any attempt to commit any of the criminal offences referred to in Article 3 and 
Article  4(3)  of  the  Directive  is  punishable  as  a  criminal  offence  (Article  5(2)).  In  a  few 
Member  States,  the  Commission  identified  non-conformity  issues  as  regards  Article  5(2). 
These  issues  concern  the  failure  to  make  a  punishable  criminal  office  of:  (i)  an  attempt  to 
commit subsidy abuse; (ii) some customs offences; and (iii) misappropriation. 

3.5. Liability of – and sanctions for – legal persons (Articles 6 and 9) 

Article 6(1) of the PIF  Directive  requires  Member States to take the necessary  measures to 
ensure  that  legal  persons  can  be  held  liable  for  any  of  the  criminal  offences  referred  to  in 
Articles 3, 4, and 5 of the Directive committed for their benefit by any person, acting either 
individually or as part of an organ of the legal person, and have a leading position within the 
legal person, based on: 

(a) a power of representation of the legal person;  
(b) an authority to take decisions on behalf of the legal person; or  
(c) an authority to exercise control within the legal person. 

Moreover, in accordance with Article 6(2), Member States are required to take the necessary 
measures  to  ensure  that  legal  persons  can  be  held  liable  where  the  lack  of  supervision  or 
control by a person referred to in Article 6(1) has made it possible to  commit, by a person 
under his or her authority, any of the criminal offences referred to in Articles 3, 4 or 5 of the 
Directive for the benefit of that legal person. 

Finally, in accordance with Article 6(3), the liability of legal persons under Articles 6(1) and 
6(2) of the Directive must not exclude the possibility of criminal proceedings against natural 
persons who are perpetrators of the criminal offences referred to in  Articles 3 and 4 of the 
Directive or who are criminally liable under Article 5.  

In a quarter of the Member States, a number of conformity issues have been identified. These 
include:  

  a lack of transposition of Article 6(1); 
  only covering the acts of persons when committed within the scope of the activities 

of the legal person; and  
the exclusion of corporate criminal liability for certain predicate offences. 

 

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Another compliance issue concerns the conflation of the requirements under Articles 6(1) and 
6(2)  in  national  legislation.  Here  it  should  be  pointed  out  that  Article  6(1)  does  not  require 
‘the lack of supervision or control’ when a PIF offence is committed for the benefit of a legal 
person by a person ‘having a leading position within the legal person’.  

Article 9 of the PIF Directive states that Member States must take the necessary measures to 
ensure  that  a  legal  person  held  liable  pursuant  to  Article  6  of  the  Directive  is  subject  to 
effective,  proportionate  and  dissuasive  sanctions,  which  must  include  criminal  or  non-
criminal fines and may include other sanctions, such as: 

(a) exclusion from entitlement to public benefits or aid;  
(b) temporary or permanent exclusion from public tender procedures;  
(c) temporary or permanent disqualification from commercial activities; 
(d) placing under judicial supervision;  
(e) judicial winding up;  
(f) temporary or permanent closure of establishments, which have been used for committing 
the criminal offence.  

On  compliance,  the  Commission  emphasises  that  corporate  liability  should  not  be  made 
dependent on a final conviction of a natural person, as is the case in one Member State, as this 
undermines  the  possibility  to  impose  effective,  proportionate  and  dissuasive  sanctions  on 
legal persons. 

3.6. Criminal penalties for natural persons (Article 7) 

Article 7 of the PIF Directive states that, for natural persons, Member States must ensure that 
the  criminal  offences  referred  to  in  Articles  3,  4  and  5  of  the  Directive  are  punishable  by 
effective,  proportionate  and  dissuasive  criminal  sanctions  (Article  7(1)).  The  criminal 
offences  referred  to  must  be  punishable  by  a  maximum  penalty  that  provides  for 
imprisonment (Article 7(2)). These offences must be punishable by a maximum penalty of at 
least 4 years of imprisonment when they involve ‘considerable damage or advantage’ (Article 
7(3))12. 

Conformity issues have been identified in a quarter of the Member States. On Article 7(1), the 
legislation  of  several  Member  States  contains  provisions  that  allow  individuals  to  escape 
criminal liability or the imposition of sanctions if they report the crime or repay the damage 
caused  to  the  Union’s  financial  interests  at  various  stages  before  or  during  criminal 
proceedings.  Such  provisions  could  make  sanctions  ineffective  and  not  dissuasive.  Other 
conformity issues relate to a failure to meet the sanctions’ threshold provided in Article 7(3) 
of the PIF Directive, notably for: 

 

‘non-disclosure  of  information’  in  the  context  of  procurement-  and  non-procurement-
related expenditure fraud;  

  preparatory acts for money laundering; 

12 Article 7(3), second and third sentence: ‘The damage or advantage resulting from the criminal offences referred to 
in points (a), (b) and (c) of Article 3(2) and in Article 4 shall be presumed to be considerable where the damage or 
advantage involves more than EUR 100 000. The damage or advantage resulting from the criminal offences referred 
to in point (d) of Article 3(2) and subject to Article 2(2) shall always be presumed to be considerable.’ 

7  

 
  
 
  
 
 
                                                           
  passive corruption without an aggravating circumstance; 
  active corruption when committed by a public official towards  another public official or 
without  a  ‘breach  of  duties’,  which,  as  described  in  Section  3.3.1,  is  not  required  by 
Article 4(2)(b) of the PIF Directive; and 

  misappropriation.  

3.7. Jurisdiction (Article 11)  

In accordance with Article 11 of the PIF Directive, a Member State must establish jurisdiction 
over  PIF  offences  where  the  criminal  offence  is  committed  in  whole  or  in  part  within  its 
territory or where the offender is one of its nationals (Article 11(1)). Member States must take 
the necessary measures to establish their jurisdiction over PIF offences where the offender is 
subject  to  the  Staff  Regulations  at  the  time  of  the  criminal  offence.  Member  States  may 
refrain from applying this rule, or may apply it only in specific cases or only where specific 
conditions are fulfilled. They must also inform the Commission if they are not applying it or 
if they are only applying it in certain cases (Article 11(2)). 

Member States must also inform  the Commission if they  decide to  extend their jurisdiction 
over PIF offences committed: (i) by habitual residents in their territory; (ii) for the benefit of a 
legal person established in their territory; or (iii) by one of their officials acting in his or her 
official duty (Article 11(3)).  

Finally, in cases where the offender is one of their nationals13, Member States must not make 
the  exercise  of  jurisdiction  subject  to  the  condition  that  a  prosecution  can  be  initiated  only 
following:  (i)  a  report  made  by  the  victim  in  the  place  where  the  criminal  offence  was 
committed; or (ii) a denunciation from the State of the place where the criminal offence was 
committed  (Article  11(4)).  The  Commission  has  identified  conformity  issues  in  a  few 
Member  States  on  these  issues.  On  the  establishment  of  jurisdiction  on  the  basis  of 
territoriality (Article 11(1)), there were two conformity issues. The first related to the lack of 
jurisdiction  on  money  laundering  as  defined  in  Article  4(1)  of  the  Directive.  The  second 
related  to  additional  conditions  such  as  that,  for  incitement  or  aiding  and  abetting  PIF 
offences: (i) the main perpetrator should be acting within the territory; or (ii) the punishment 
provided by national law must be above a certain threshold. 

The  extension  of  jurisdiction  to  offenders  subject  to  the  Staff  Regulations,  with  or  without 
imposing specific conditions, in accordance with Article 11(2) has been provided for by the 
national legislation of 12 Member States. 

About half of the Member States extend their jurisdiction over PIF offences committed: (i) by 
habitual residents in their territory; or (ii) for the benefit of a legal person established in their 
territory; and/or (iii) by one of their officials acting in his or her official duty (Article 11(3)). 
Compliance  issues  with  Article  11(4)  relate  to  the  imposition  of  the  condition  that  a 
prosecution can be initiated only: (i) following a report made by the victim in the place where 
the criminal offence was committed; or (ii) following a complaint of the injured party (if such 
a complaint is required for prosecution under foreign law).  

13 In accordance with Article 11(1)(b). 

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3.8. Limitation period (Article 12) 

In accordance with Article 12(1) of the PIF Directive, Member States must take the necessary 
measures  to  provide  for  a  limitation  period.  This  period  must  enable  the  investigation, 
prosecution, trial and judicial decision of criminal offences referred to in Articles 3, 4 and 5 
for  a  sufficient  period  of  time  after  the  commission  of  those  criminal  offences,  in  order  for 
those criminal offences to be tackled effectively. The Directive provides minimum limitation 
periods for those offences that are punishable by a maximum sanction of at least 4  years of 
imprisonment  (Articles  12(2)  and  12(3)).  The  Directive  also  provides  limitation  periods  for 
the  enforceability  of  penalties  following  a  conviction  for  a  criminal  offence  referred  to  in 
Articles 3, 4 and 5 (Article 12(4)). A transposition issue exists in some Member States in the 
limitation period for executing a judgment imposed following a final conviction for a criminal 
offence referred to in Articles 3, 4 or 5, which is shorter than the 5 years required by Article 
12(4).  

4. CONCLUSIONS  

The  PIF  Directive  was  adopted  with  the  aim  of  strengthening  protection  against  criminal 
offences  affecting  the  Union’s  financial  interests.  The  Directive  provides  added  value  by 
setting:  (i)  common  minimum  rules  for  defining  criminal  offences;  and  (ii)  sanctions  for 
combating  fraud  and  other  illegal  activities  affecting  the  Union’s  financial  interests.  All 
Member States have transposed the PIF Directive’s main provisions.  

However,  the  assessment  shows  that  the  transposition  of  the  Directive  still  needs  to  be 
improved,  notably  to  ensure:  (i)  the  consistent  transposition  of  the  definitions  of  criminal 
offences referred to in Articles 3, 4 and 5; and (ii) the liability of – and sanctions for – legal 
persons  and  natural  persons  in  accordance  with  Articles  6,  7  and  9.  There  is  also  a  need  to 
properly  transpose  the  provisions  on  the  exercise  of  jurisdiction  (Article  11)  and  limitation 
periods (Article 12).  

Proper  transposition  requires  further  legislative  action  by  the  Member  States  to  fully  align 
their  national  legislation  with  the  requirements  of  the  PIF  Directive.  This  is  especially 
important to enable the EPPO to conduct effective investigations and prosecutions. 

It is also essential for Member States to report statistical data to the European Commission on 
criminal proceedings and their outcome (Article 18(2)). This reporting is crucial for assessing 
whether the protection of the Union’s financial interests has been achieved based on the PIF 
Directive.  

In  accordance with  Article 18 of the PIF Directive, the Commission  will continue to  assess 
Member States’ compliance with the PIF Directive and will take every appropriate measure to 
ensure conformity with its provisions throughout the European Union.  

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