Article 1 Objectives and tasks
1. In order to step up the fight against fraud, corruption and any other illegal activity affecting the financial interests of the European Union and of the European Atomic Energy Community (hereinafter referred to collectively, when the context so requires, as ‘the Union’), the European Anti-Fraud Office established by Decision 1999/352/EC, ECSC, Euratom (‘the Office’) shall exercise the powers of investigation conferred on the Commission by: (a) the relevant Union acts; and (b) the relevant cooperation and mutual assistance agreements concluded by the Union with third countries and international organisations. 2. The Office shall provide the Member States with assistance from the Commission in organising close and regular cooperation between their competent authorities in order to coordinate their action aimed at protecting the financial interests of the Union against fraud. The Office shall contribute to the design and development of methods of preventing and combating fraud, corruption and any other illegal activity affecting the financial interests of the Union. The Office shall promote and coordinate, with and among the Member States, the sharing of operational experience and best procedural practices in the field of the protection of the financial interests of the Union, and shall support joint anti-fraud actions undertaken by Member States on a voluntary basis. 3. This Regulation shall apply without prejudice to: (a) Protocol No 7 on the privileges and immunities of the European Union attached to the Treaty on European Union and to the Treaty on the Functioning of the European Union; (b) the Statute for Members of the European Parliament; (c) the Staff Regulations; (d) Regulation (EC) No 45/2001. 4. Within the institutions, bodies, offices and agencies established by, or on the basis of, the Treaties (‘institutions, bodies, offices and agencies’), the Office shall conduct administrative investigations for the purpose of fighting fraud, corruption and any other illegal activity affecting the financial interests of the Union. To that end, it shall investigate serious matters relating to the discharge of professional duties constituting a dereliction of the obligations of officials and other servants of the Union liable to result in disciplinary or, as the case may be, criminal proceedings, or an equivalent failure to discharge obligations on the part of members of institutions and bodies, heads of offices and agencies or staff members of institutions, bodies, offices or agencies not subject to the Staff Regulations (hereinafter collectively referred to as ‘officials, other servants, members of institutions or bodies, heads of offices or agencies, or staff members’). 5. For the application of this Regulation, competent authorities of the Member States and institutions, bodies, offices or agencies may establish administrative arrangements with the Office. Those administrative arrangements may concern, in particular, the transmission of information and the conduct of investigations.
Amendment rationale: CONTEXT OF THE PROPOSAL Reasons for and objectives of the proposal The Commission is pursuing an ambitious legislative agenda to strengthen the protection of the Union's financial interests. In July 2017, the Parliament and the Council adopted the Directive on the fight against fraud to the Union's financial interests by means of criminal law. In October 2017, the Council adopted the Regulation implementing enhanced cooperation on the establishment of the European Public Prosecutor's Office (EPPO). The establishment of the EPPO is a key Commission priority in the areas of criminal justice and the fight against fraud to the Union budget. The EPPO will change the EU institutional anti-fraud landscape significantly. It will have the power to conduct criminal investigations and prosecute before the courts of the participating Member States. It is expected to bring a more consistent and effective prosecution policy for crimes affecting the Union budget, leading to more prosecutions, convictions and a higher level of recovery. As a consequence of the adoption of the EPPO Regulation, Regulation No 883/2013 governing investigations by the European Anti-Fraud Office (OLAF) needs to be adapted. OLAF was set up in 1999 with the task, in particular, of conducting administrative investigations in the area of the protection of the Union's financial interests. Within its administrative mandate, OLAF investigates administrative irregularities as well as criminal behaviour. It plays a significant role in the fight against fraud, corruption and other illegal activities through its investigations aimed at enabling financial recoveries, disciplinary and administrative action, as well as indictments and prosecutions. OLAF has used its investigative expertise in a constantly developing context of fraud to the Union budget. It has handled increasing numbers of investigations, leading to increasing numbers of recommendations and amounts recommended for recovery. In the area of fraud, the creation of the EPPO will be a substantial improvement to the current situation. Today, OLAF carries out administrative investigations using administrative powers which are limited compared to criminal investigations. When it encounters possible criminal offences, it can only address a recommendation to national judicial authorities, but with no guarantees as to whether a criminal investigation will be opened. In future, in the Member States participating in the EPPO, it will report such suspected offences to the EPPO, and collaborate with it in the context of its investigations. Provisions to regulate the relationship between the EPPO and OLAF already exist in the EPPO Regulation. They are based on the principles of close cooperation, exchange of information, complementarity and non-duplication. These rules need to be mirrored and complemented in Regulation No 883/2013. The adaptation of the OLAF legal framework by the time the EPPO becomes operational is therefore the main driver for the amendment of Regulation No 883/2013. To ensure a smooth transition into the new framework, the amended Regulation should enter into force before the EPPO becomes operational (envisaged for the end of 2020). The EPPO and OLAF are both, within their respective remits, entrusted with the mandate to protect the Union's financial interests. While the EPPO will conduct criminal investigations aimed at investigating, prosecuting and bringing to judgment the perpetrators of, and accomplices to, offences affecting the financial interests of the Union, OLAF will continue conducting administrative investigations with a particular emphasis on facilitating administrative recovery and preventing further harm to the EU finances through administrative measures. Thus, the focus of activity of the future EPPO and of OLAF is distinct, although they converge towards a common goal. OLAF will also continue its investigations, in the same way as today, in the Member States not participating in the EPPO at this stage. In these Member States, the national authorities as well as OLAF should contribute to creating the conditions to ensure an effective and equivalent level of protection of the Union’s financial interests in the whole EU. In such circumstances, it is essential that the legal framework for OLAF is fit-for-purpose to allow it to fulfil its role with regard to the EPPO, the Member States and Union institutions, bodies, offices and agencies. The Commission evaluation of Regulation No 883/2013 concluded that the Regulation allowed OLAF to continue delivering concrete results in the protection of the Union budget. The 2013 changes brought clear improvements, as regards the conduct of investigations, cooperation with partners and the rights of persons concerned. At the same time, the evaluation highlighted shortcomings which impact on the effectiveness and efficiency of investigations. These findings relate to a wide range of areas including OLAF’s investigative tools, the enforcement of OLAF powers, uniform conditions in the conduct of internal investigations, the conduct of digital forensic operations, divergences in the follow-up to OLAF recommendations, the duties of cooperation by Member States and Union institutions, bodies, offices and agencies, or the overall coherence of the legal framework. However, addressing all evaluation findings is outside the scope of this proposal, as the revised Regulation should be in force by the time the EPPO becomes operational. The proposal therefore contains a limited number of targeted changes, based on the most unambiguous evaluation findings. These are essential changes necessary in the short term to strengthen the framework for OLAF investigations, in order to maintain a strong and fully-functioning OLAF that complements the EPPO's criminal law approach with administrative investigations, but which do not entail a change to its mandate or powers. The focus is on areas where, today, the lack of clarity of certain provisions in the current Regulation results in obstacles which hinder OLAF’s effective operations, regarding, notably, on-the-spot-checks and inspections or access to bank account information. The amendments proposed aim to clarify and reduce ambiguity in the current provisions for the economic operators concerned, for the Member States, and for OLAF, thus enhancing legal certainty. They would allow OLAF to operate in an effective and more coherent manner in all its investigations. This is directly related to the objectives of a strong protection of the budget across the Union coupled with appropriate procedural safeguards for economic operators subject to investigation. The overall objective of the proposal is to strengthen the protection of the Union's financial interests. This will be achieved by three specific objectives to: – adapt the operation of OLAF to the establishment of the EPPO; – enhance the effectiveness of OLAF’s investigative function; – clarify and simplify selected provisions of Regulation No 883/2013. The Commission evaluation report already indicated that the proposal containing these targeted changes could be followed by a more far-reaching process to modernise the OLAF framework, which in its core aspects dates from the creation of OLAF in 1999. This would be the opportunity to consider other more fundamental changes in the context of 21st century fraud areas and trends, and it should take account of the experience gained in the cooperation between the EPPO and OLAF. It would also allow considering other evaluation findings, as well as aspects of the legal framework where further reflection and discussion may be needed.
Revised version (Article 1 Objectives and tasks):
1. In order to step up the fight against fraud, corruption and any other illegal activity affecting the financial interests of the European Union and of the European Atomic Energy Community (hereinafter referred to collectively, when the context so requires, as ‘the Union’), the European Anti-Fraud Office established by Decision 1999/352/EC, ECSC, Euratom (‘the Office’) shall exercise the powers of investigation conferred on the Commission by: (a) the relevant Union acts; and (b) the relevant cooperation and mutual assistance agreements concluded by the Union with third countries and international organisations. 2. The Office shall provide the Member States with assistance from the Commission in organising close and regular cooperation between their competent authorities in order to coordinate their action aimed at protecting the financial interests of the Union against fraud. The Office shall contribute to the design and development of methods of preventing and combating fraud, corruption and any other illegal activity affecting the financial interests of the Union. The Office shall promote and coordinate, with and among the Member States, the sharing of operational experience and best procedural practices in the field of the protection of the financial interests of the Union, and shall support joint anti-fraud actions undertaken by Member States on a voluntary basis. 4. Within the institutions, bodies, offices and agencies established by, or on the basis of, the Treaties (‘institutions, bodies, offices and agencies’), the Office shall conduct administrative investigations for the purpose of fighting fraud, corruption and any other illegal activity affecting the financial interests of the Union. To that end, it shall investigate serious matters relating to the discharge of professional duties constituting a dereliction of the obligations of officials and other servants of the Union liable to result in disciplinary or, as the case may be, criminal proceedings, or an equivalent failure to discharge obligations on the part of members of institutions and bodies, heads of offices and agencies or staff members of institutions, bodies, offices or agencies not subject to the Staff Regulations (hereinafter collectively referred to as ‘officials, other servants, members of institutions or bodies, heads of offices or agencies, or staff members’). 4a. The Office shall establish and maintain a close relationship with the European Public Prosecutor’s Office (EPPO) established in enhanced cooperation by Council Regulation (EU) 2017/1939 ( 3 ). That relationship shall be based on mutual cooperation, information exchange, complementarity and the avoidance of duplication. It shall aim in particular to ensure that all available means are used to protect the financial interests of the Union through the complementarity of their respective mandates and the support provided by the Office to the EPPO. 5. For the application of this Regulation, competent authorities of the Member States and institutions, bodies, offices and agencies may establish administrative arrangements with the Office. Those administrative arrangements may concern, in particular, the transmission of information, the conduct of investigations and any follow-up action.
Article 2 Definitions
For the purposes of this Regulation: (1) ‘financial interests of the Union’ shall include revenues, expenditures and assets covered by the budget of the European Union and those covered by the budgets of the institutions, bodies, offices and agencies and the budgets managed and monitored by them; (2) ‘irregularity’ shall mean ‘irregularity’ as defined in Article 1(2) of Regulation (EC, Euratom) No 2988/95; (3) ‘fraud, corruption and any other illegal activity affecting the financial interests of the Union’ shall have the meaning applied to those words in the relevant Union acts; (4) ‘administrative investigations’ (‘investigations’) shall mean any inspection, check or other measure undertaken by the Office in accordance with Articles 3 and 4, with a view to achieving the objectives set out in Article 1 and to establishing, where necessary, the irregular nature of the activities under investigation; those investigations shall not affect the powers of the competent authorities of the Member States to initiate criminal proceedings; (5) ‘person concerned’ shall mean any person or economic operator suspected of having committed fraud, corruption or any other illegal activity affecting the financial interests of the Union and who is therefore subject to investigation by the Office; (6) ‘economic operator’ shall have the meaning applied to that term by Regulation (EC, Euratom) No 2988/95 and Regulation (Euratom, EC) No 2185/96; (7) ‘administrative arrangements’ shall mean arrangements of a technical and/or operational nature concluded by the Office, which may in particular aim at facilitating the cooperation and the exchange of information between the parties thereto, and which do not create additional legal obligations.
Amendment rationale: CONTEXT OF THE PROPOSAL Reasons for and objectives of the proposal The Commission is pursuing an ambitious legislative agenda to strengthen the protection of the Union's financial interests. In July 2017, the Parliament and the Council adopted the Directive on the fight against fraud to the Union's financial interests by means of criminal law. In October 2017, the Council adopted the Regulation implementing enhanced cooperation on the establishment of the European Public Prosecutor's Office (EPPO). The establishment of the EPPO is a key Commission priority in the areas of criminal justice and the fight against fraud to the Union budget. The EPPO will change the EU institutional anti-fraud landscape significantly. It will have the power to conduct criminal investigations and prosecute before the courts of the participating Member States. It is expected to bring a more consistent and effective prosecution policy for crimes affecting the Union budget, leading to more prosecutions, convictions and a higher level of recovery. As a consequence of the adoption of the EPPO Regulation, Regulation No 883/2013 governing investigations by the European Anti-Fraud Office (OLAF) needs to be adapted. OLAF was set up in 1999 with the task, in particular, of conducting administrative investigations in the area of the protection of the Union's financial interests. Within its administrative mandate, OLAF investigates administrative irregularities as well as criminal behaviour. It plays a significant role in the fight against fraud, corruption and other illegal activities through its investigations aimed at enabling financial recoveries, disciplinary and administrative action, as well as indictments and prosecutions. OLAF has used its investigative expertise in a constantly developing context of fraud to the Union budget. It has handled increasing numbers of investigations, leading to increasing numbers of recommendations and amounts recommended for recovery. In the area of fraud, the creation of the EPPO will be a substantial improvement to the current situation. Today, OLAF carries out administrative investigations using administrative powers which are limited compared to criminal investigations. When it encounters possible criminal offences, it can only address a recommendation to national judicial authorities, but with no guarantees as to whether a criminal investigation will be opened. In future, in the Member States participating in the EPPO, it will report such suspected offences to the EPPO, and collaborate with it in the context of its investigations. Provisions to regulate the relationship between the EPPO and OLAF already exist in the EPPO Regulation. They are based on the principles of close cooperation, exchange of information, complementarity and non-duplication. These rules need to be mirrored and complemented in Regulation No 883/2013. The adaptation of the OLAF legal framework by the time the EPPO becomes operational is therefore the main driver for the amendment of Regulation No 883/2013. To ensure a smooth transition into the new framework, the amended Regulation should enter into force before the EPPO becomes operational (envisaged for the end of 2020). The EPPO and OLAF are both, within their respective remits, entrusted with the mandate to protect the Union's financial interests. While the EPPO will conduct criminal investigations aimed at investigating, prosecuting and bringing to judgment the perpetrators of, and accomplices to, offences affecting the financial interests of the Union, OLAF will continue conducting administrative investigations with a particular emphasis on facilitating administrative recovery and preventing further harm to the EU finances through administrative measures. Thus, the focus of activity of the future EPPO and of OLAF is distinct, although they converge towards a common goal. OLAF will also continue its investigations, in the same way as today, in the Member States not participating in the EPPO at this stage. In these Member States, the national authorities as well as OLAF should contribute to creating the conditions to ensure an effective and equivalent level of protection of the Union’s financial interests in the whole EU. In such circumstances, it is essential that the legal framework for OLAF is fit-for-purpose to allow it to fulfil its role with regard to the EPPO, the Member States and Union institutions, bodies, offices and agencies. The Commission evaluation of Regulation No 883/2013 concluded that the Regulation allowed OLAF to continue delivering concrete results in the protection of the Union budget. The 2013 changes brought clear improvements, as regards the conduct of investigations, cooperation with partners and the rights of persons concerned. At the same time, the evaluation highlighted shortcomings which impact on the effectiveness and efficiency of investigations. These findings relate to a wide range of areas including OLAF’s investigative tools, the enforcement of OLAF powers, uniform conditions in the conduct of internal investigations, the conduct of digital forensic operations, divergences in the follow-up to OLAF recommendations, the duties of cooperation by Member States and Union institutions, bodies, offices and agencies, or the overall coherence of the legal framework. However, addressing all evaluation findings is outside the scope of this proposal, as the revised Regulation should be in force by the time the EPPO becomes operational. The proposal therefore contains a limited number of targeted changes, based on the most unambiguous evaluation findings. These are essential changes necessary in the short term to strengthen the framework for OLAF investigations, in order to maintain a strong and fully-functioning OLAF that complements the EPPO's criminal law approach with administrative investigations, but which do not entail a change to its mandate or powers. The focus is on areas where, today, the lack of clarity of certain provisions in the current Regulation results in obstacles which hinder OLAF’s effective operations, regarding, notably, on-the-spot-checks and inspections or access to bank account information. The amendments proposed aim to clarify and reduce ambiguity in the current provisions for the economic operators concerned, for the Member States, and for OLAF, thus enhancing legal certainty. They would allow OLAF to operate in an effective and more coherent manner in all its investigations. This is directly related to the objectives of a strong protection of the budget across the Union coupled with appropriate procedural safeguards for economic operators subject to investigation. The overall objective of the proposal is to strengthen the protection of the Union's financial interests. This will be achieved by three specific objectives to: – adapt the operation of OLAF to the establishment of the EPPO; – enhance the effectiveness of OLAF’s investigative function; – clarify and simplify selected provisions of Regulation No 883/2013. The Commission evaluation report already indicated that the proposal containing these targeted changes could be followed by a more far-reaching process to modernise the OLAF framework, which in its core aspects dates from the creation of OLAF in 1999. This would be the opportunity to consider other more fundamental changes in the context of 21st century fraud areas and trends, and it should take account of the experience gained in the cooperation between the EPPO and OLAF. It would also allow considering other evaluation findings, as well as aspects of the legal framework where further reflection and discussion may be needed.
Revised version (Article 2 Definitions):
For the purposes of this Regulation: (1) ‘financial interests of the Union’ shall include revenues, expenditures and assets covered by the budget of the European Union and those covered by the budgets of the institutions, bodies, offices and agencies and the budgets managed and monitored by them; (2) ‘irregularity’ shall mean ‘irregularity’ as defined in Article 1(2) of Regulation (EC, Euratom) No 2988/95; (3) ‘fraud, corruption and any other illegal activity affecting the financial interests of the Union’ shall have the meaning applied to those words in the relevant Union acts and the notion of ‘any other illegal activity’ shall include irregularity as defined in Article 1(2) of Regulation (EC, Euratom) No 2988/95; (4) ‘administrative investigations’ (‘investigations’) shall mean any inspection, check or other measure undertaken by the Office in accordance with Articles 3 and 4, with a view to achieving the objectives set out in Article 1 and to establishing, where necessary, the irregular nature of the activities under investigation; those investigations shall not affect the powers of the EPPO or of the competent authorities of Member States to initiate and conduct criminal proceedings; (5) ‘person concerned’ shall mean any person or economic operator suspected of having committed fraud, corruption or any other illegal activity affecting the financial interests of the Union and who is therefore subject to investigation by the Office; (6) ‘economic operator’ shall have the meaning applied to that term by Regulation (EC, Euratom) No 2988/95 and Regulation (Euratom, EC) No 2185/96; (7) ‘administrative arrangements’ shall mean arrangements of a technical and/or operational nature concluded by the Office, which may in particular aim at facilitating the cooperation and the exchange of information between the parties thereto, and which do not create additional legal obligations; (8) ‘member of an institution’ means a member of the European Parliament, a member of the European Council, a representative of a Member State at ministerial level in the Council, a member of the Commission, a member of the Court of Justice of the European Union (CJEU), a member of the Governing Council of the European Central Bank or a member of the Court of Auditors, with respect to the obligations imposed by Union law in the context of the duties they perform in that capacity.
Article 3 External investigations
1. The Office shall exercise the power conferred on the Commission by Regulation (Euratom, EC) No 2185/96 to carry out on-the-spot checks and inspections in the Member States and, in accordance with the cooperation and mutual assistance agreements and any other legal instrument in force, in third countries and on the premises of international organisations. As part of its investigative function, the Office shall carry out the checks and inspections provided for in Article 9(1) of Regulation (EC, Euratom) No 2988/95 and in the sectoral rules referred to in Article 9(2) of that Regulation in the Member States and, in accordance with the cooperation and mutual assistance agreements and any other legal instrument in force, in third countries and on the premises of international organisations. 2. With a view to establishing whether there has been fraud, corruption or any other illegal activity affecting the financial interests of the Union in connection with a grant agreement or decision or a contract concerning Union funding, the Office may, in accordance with the provisions and procedures laid down by Regulation (Euratom, EC) No 2185/96, conduct on-the-spot checks and inspections on economic operators. 3. During on-the-spot checks and inspections, the staff of the Office shall act, subject to the Union law applicable, in compliance with the rules and practices of the Member State concerned and with the procedural guarantees provided for in this Regulation. At the request of the Office, the competent authority of the Member State concerned shall provide the staff of the Office with the assistance needed in order to carry out their tasks effectively, as specified in the written authorisation referred to in Article 7(2). If that assistance requires authorisation from a judicial authority in accordance with national rules, such authorisation shall be applied for. The Member State concerned shall ensure, in accordance with Regulation (Euratom, EC) No 2185/96, that the staff of the Office are allowed access, under the same terms and conditions as its competent authorities and in compliance with its national law, to all information and documents relating to the matter under investigation which prove necessary in order for the on-the-spot checks and inspections to be carried out effectively and efficiently. 4. Member States shall, for the purposes of this Regulation, designate a service (‘the anti-fraud coordination service’) to facilitate effective cooperation and exchange of information, including information of an operational nature, with the Office. Where appropriate, in accordance with national law, the anti-fraud coordination service may be regarded as a competent authority for the purposes of this Regulation. 5. During an external investigation, the Office may have access to any relevant information, including information in databases, held by the institutions, bodies, offices and agencies, connected with the matter under investigation, where necessary in order to establish whether there has been fraud, corruption or any other illegal activity affecting the financial interests of the Union. For that purpose Article 4(2) and (4) shall apply. 6. Where, before a decision has been taken whether or not to open an external investigation, the Office handles information which suggests that there has been fraud, corruption or any other illegal activity affecting the financial interests of the Union, it may inform the competent authorities of the Member States concerned and, where necessary, the competent Commission services. Without prejudice to the sectoral rules referred to in Article 9(2) of Regulation (EC, Euratom) No 2988/95, the competent authorities of the Member States concerned shall ensure that appropriate action is taken, in which the Office may take part, in compliance with national law. Upon request, the competent authorities of the Member States concerned shall inform the Office of the action taken and of their findings on the basis of information as referred to in the first subparagraph of this paragraph.
Amendment rationale: CONTEXT OF THE PROPOSAL Reasons for and objectives of the proposal The Commission is pursuing an ambitious legislative agenda to strengthen the protection of the Union's financial interests. In July 2017, the Parliament and the Council adopted the Directive on the fight against fraud to the Union's financial interests by means of criminal law. In October 2017, the Council adopted the Regulation implementing enhanced cooperation on the establishment of the European Public Prosecutor's Office (EPPO). The establishment of the EPPO is a key Commission priority in the areas of criminal justice and the fight against fraud to the Union budget. The EPPO will change the EU institutional anti-fraud landscape significantly. It will have the power to conduct criminal investigations and prosecute before the courts of the participating Member States. It is expected to bring a more consistent and effective prosecution policy for crimes affecting the Union budget, leading to more prosecutions, convictions and a higher level of recovery. As a consequence of the adoption of the EPPO Regulation, Regulation No 883/2013 governing investigations by the European Anti-Fraud Office (OLAF) needs to be adapted. OLAF was set up in 1999 with the task, in particular, of conducting administrative investigations in the area of the protection of the Union's financial interests. Within its administrative mandate, OLAF investigates administrative irregularities as well as criminal behaviour. It plays a significant role in the fight against fraud, corruption and other illegal activities through its investigations aimed at enabling financial recoveries, disciplinary and administrative action, as well as indictments and prosecutions. OLAF has used its investigative expertise in a constantly developing context of fraud to the Union budget. It has handled increasing numbers of investigations, leading to increasing numbers of recommendations and amounts recommended for recovery. In the area of fraud, the creation of the EPPO will be a substantial improvement to the current situation. Today, OLAF carries out administrative investigations using administrative powers which are limited compared to criminal investigations. When it encounters possible criminal offences, it can only address a recommendation to national judicial authorities, but with no guarantees as to whether a criminal investigation will be opened. In future, in the Member States participating in the EPPO, it will report such suspected offences to the EPPO, and collaborate with it in the context of its investigations. Provisions to regulate the relationship between the EPPO and OLAF already exist in the EPPO Regulation. They are based on the principles of close cooperation, exchange of information, complementarity and non-duplication. These rules need to be mirrored and complemented in Regulation No 883/2013. The adaptation of the OLAF legal framework by the time the EPPO becomes operational is therefore the main driver for the amendment of Regulation No 883/2013. To ensure a smooth transition into the new framework, the amended Regulation should enter into force before the EPPO becomes operational (envisaged for the end of 2020). The EPPO and OLAF are both, within their respective remits, entrusted with the mandate to protect the Union's financial interests. While the EPPO will conduct criminal investigations aimed at investigating, prosecuting and bringing to judgment the perpetrators of, and accomplices to, offences affecting the financial interests of the Union, OLAF will continue conducting administrative investigations with a particular emphasis on facilitating administrative recovery and preventing further harm to the EU finances through administrative measures. Thus, the focus of activity of the future EPPO and of OLAF is distinct, although they converge towards a common goal. OLAF will also continue its investigations, in the same way as today, in the Member States not participating in the EPPO at this stage. In these Member States, the national authorities as well as OLAF should contribute to creating the conditions to ensure an effective and equivalent level of protection of the Union’s financial interests in the whole EU. In such circumstances, it is essential that the legal framework for OLAF is fit-for-purpose to allow it to fulfil its role with regard to the EPPO, the Member States and Union institutions, bodies, offices and agencies. The Commission evaluation of Regulation No 883/2013 concluded that the Regulation allowed OLAF to continue delivering concrete results in the protection of the Union budget. The 2013 changes brought clear improvements, as regards the conduct of investigations, cooperation with partners and the rights of persons concerned. At the same time, the evaluation highlighted shortcomings which impact on the effectiveness and efficiency of investigations. These findings relate to a wide range of areas including OLAF’s investigative tools, the enforcement of OLAF powers, uniform conditions in the conduct of internal investigations, the conduct of digital forensic operations, divergences in the follow-up to OLAF recommendations, the duties of cooperation by Member States and Union institutions, bodies, offices and agencies, or the overall coherence of the legal framework. However, addressing all evaluation findings is outside the scope of this proposal, as the revised Regulation should be in force by the time the EPPO becomes operational. The proposal therefore contains a limited number of targeted changes, based on the most unambiguous evaluation findings. These are essential changes necessary in the short term to strengthen the framework for OLAF investigations, in order to maintain a strong and fully-functioning OLAF that complements the EPPO's criminal law approach with administrative investigations, but which do not entail a change to its mandate or powers. The focus is on areas where, today, the lack of clarity of certain provisions in the current Regulation results in obstacles which hinder OLAF’s effective operations, regarding, notably, on-the-spot-checks and inspections or access to bank account information. The amendments proposed aim to clarify and reduce ambiguity in the current provisions for the economic operators concerned, for the Member States, and for OLAF, thus enhancing legal certainty. They would allow OLAF to operate in an effective and more coherent manner in all its investigations. This is directly related to the objectives of a strong protection of the budget across the Union coupled with appropriate procedural safeguards for economic operators subject to investigation. The overall objective of the proposal is to strengthen the protection of the Union's financial interests. This will be achieved by three specific objectives to: – adapt the operation of OLAF to the establishment of the EPPO; – enhance the effectiveness of OLAF’s investigative function; – clarify and simplify selected provisions of Regulation No 883/2013. The Commission evaluation report already indicated that the proposal containing these targeted changes could be followed by a more far-reaching process to modernise the OLAF framework, which in its core aspects dates from the creation of OLAF in 1999. This would be the opportunity to consider other more fundamental changes in the context of 21st century fraud areas and trends, and it should take account of the experience gained in the cooperation between the EPPO and OLAF. It would also allow considering other evaluation findings, as well as aspects of the legal framework where further reflection and discussion may be needed.
Revised version (Article 3 External investigations):
1. In the areas referred to in Article 1, the Office shall carry out on-the-spot checks and inspections in Member States and, in accordance with cooperation and mutual assistance agreements and any other legal instrument in force, in third countries and on the premises of international organisations. 2. The Office shall carry out on-the-spot checks and inspections in accordance with this Regulation and, to the extent not covered by this Regulation, in accordance with Regulation (Euratom, EC) No 2185/96. 3. Economic operators shall cooperate with the Office in the course of its investigations. The Office may request written and oral information, including through interviews. 4. Where, in accordance with paragraph 3 of this Article, the economic operator concerned submits to an on-the-spot check and inspection authorised pursuant to this Regulation, Article 2(4) of Regulation (EC, Euratom) No 2988/95, the third subparagraph of Article 6(1) of Regulation (Euratom, EC) No 2185/96 and Article 7(1) of Regulation (Euratom, EC) No 2185/96 shall not apply insofar as those provisions require compliance with national law and are capable of restricting access to information and documentation by the Office to the same conditions as those that apply to national administrative inspectors. 5. At the request of the Office, the competent authority of the Member State concerned shall, without undue delay, provide the staff of the Office with the assistance needed in order to carry out their tasks effectively, as specified in the written authorisation referred to in Article 7(2). The Member State concerned shall ensure, in accordance with Regulation (Euratom, EC) No 2185/96, that the staff of the Office are allowed access to all information, documents and data relating to the matter under investigation which prove necessary in order for the on-the-spot checks and inspections to be carried out effectively and efficiently, and that the staff are able to assume custody of documents or data to ensure that there is no danger of their disappearance. Where privately owned devices are used for work purposes, those devices may be subject to inspection by the Office. The Office shall subject such devices to inspection only under the same conditions and to the same extent that national control authorities are allowed to investigate privately owned devices and where the Office has reasonable grounds for suspecting that their content may be relevant for the investigation. 6. Where the staff of the Office find that an economic operator resists an on-the-spot check and inspection authorised pursuant to this Regulation, namely where the economic operator refuses to grant the Office the necessary access to its premises or any other areas used for business purposes, conceals information or prevents the conduct of any of the activities that the Office needs to perform in the course of an on-the-spot check and inspection, the competent authorities, including, where appropriate, law enforcement authorities of the Member State concerned shall afford the staff of the Office the necessary assistance so as to enable the Office to conduct its on-the-spot check and inspection effectively and without undue delay. When providing assistance in accordance with this paragraph or with paragraph 5, the competent authorities of Member States shall act in accordance with national procedural rules applicable to the competent authority concerned. If such assistance requires authorisation from a judicial authority in accordance with national law, such authorisation shall be applied for. 7. The Office shall conduct on-the-spot checks and inspections upon production of written authorisation, as provided for in Article 7(2). It shall, at the latest at the start of the on-the-spot check and inspection, inform the economic operator concerned of the procedure applicable to the on-the-spot check and inspection, including the applicable procedural safeguards, and the economic operator's duty to cooperate. 8. In the exercise of the powers assigned to it, the Office shall comply with the procedural guarantees provided for in this Regulation and in Regulation (Euratom, EC) No 2185/96. In the conduct of an on-the-spot check and inspection, the economic operator concerned shall have the right not to make self-incriminating statements and to be assisted by a person of the economic operator’s choice. When making statements during an on-the-spot check and inspection, the economic operator shall be provided with the possibility to use any of the official languages of the Member State where that economic operator is located. The right to be assisted by a person of choice shall not prevent access by the Office to the premises of the economic operator and shall not unduly delay the start of the on-the-spot check and inspection. 9. Where a Member State does not cooperate with the Office in accordance with paragraphs 5 and 6, the Commission may apply the relevant provisions of Union law in order to recover the funds related to the on-the-spot check and inspection in question. 10. As part of its investigative function, the Office shall carry out the checks and inspections provided for in Article 9(1) of Regulation (EC, Euratom) No 2988/95 and in the sectoral rules referred to in Article 9(2) of that Regulation in Member States and, in accordance with cooperation and mutual assistance agreements and any other legal instrument in force, in third countries and on the premises of international organisations. 11. During an external investigation, the Office may have access to any relevant information and data, irrespective of the medium on which it is stored, held by the institutions, bodies, offices and agencies, connected with the matter under investigation, where necessary in order to establish whether there has been fraud, corruption or any other illegal activity affecting the financial interests of the Union. For that purpose Article 4(2) and (4) shall apply. 12. Without prejudice to Article 12c(1), where, before a decision has been taken whether or not to open an external investigation, the Office handles information which suggests that there has been fraud, corruption or any other illegal activity affecting the financial interests of the Union, it may inform the competent authorities of the Member States concerned and, where necessary, the institutions, bodies, offices and agencies concerned. Without prejudice to the sectoral rules referred to in Article 9(2) of Regulation (EC, Euratom) No 2988/95, the competent authorities of the Member States concerned shall ensure that appropriate action is taken, in which the Office may take part, in accordance with national law. Upon request, the competent authorities of the Member States concerned shall inform the Office of the action taken and of their findings on the basis of information referred to in the first subparagraph of this paragraph.
Article 4 Internal investigations
1. In the areas referred to in Article 1, the Office shall carry out administrative investigations within the institutions, bodies, offices and agencies (‘internal investigations’). Those internal investigations shall be conducted in accordance with the conditions set out in this Regulation and in the decisions adopted by the respective institution, body, office or agency. 2. Provided that the provisions referred to in paragraph 1 are complied with: (a) the Office shall have the right of immediate and unannounced access to any relevant information, including information in databases, held by the institutions, bodies, offices and agencies, and to their premises. The Office shall be empowered to inspect the accounts of the institutions, bodies, offices and agencies. The Office may take a copy of, and obtain extracts from, any document or the contents of any data medium held by the institutions, bodies, offices and agencies and, if necessary, assume custody of such documents or data to ensure that there is no danger of their disappearance; (b) the Office may request oral information, including through interviews, and written information from officials, other servants, members of institutions or bodies, heads of offices or agencies, or staff members. 3. In accordance with the provisions and procedures laid down by Regulation (Euratom, EC) No 2185/96, the Office may carry out on-the-spot checks and inspections at the premises of economic operators in order to obtain access to information relevant to the matter under internal investigation. 4. The institutions, bodies, offices and agencies shall be informed whenever the staff of the Office conduct an internal investigation on their premises or consult a document or request information held by them. Without prejudice to Articles 10 and 11, the Office may at any time forward to the institution, body, office or agency concerned the information obtained in the course of internal investigations. 5. The institutions, bodies, offices and agencies shall put in place appropriate procedures and take necessary measures to ensure at all stages the confidentiality of internal investigations. 6. Where internal investigations reveal that an official, other servant, member of an institution or body, head of office or agency, or staff member may be a person concerned, the institution, body, office or agency to which that person belongs shall be informed. In cases where the confidentiality of the internal investigation cannot be ensured using the usual channels of communication, the Office shall use appropriate alternative channels for transmitting information. In exceptional cases, the provision of such information may be deferred on the basis of a reasoned decision by the Director-General, which shall be transmitted to the Supervisory Committee after the closure of the investigation. 7. The decision to be adopted by each institution, body, office or agency as provided for in paragraph 1 shall include, in particular, a rule concerning a duty on the part of officials, other servants, members of institutions or bodies, heads of offices or agencies, or staff members to cooperate with and supply information to the Office, while ensuring the confidentiality of the internal investigation. 8. Where, before a decision has been taken whether or not to open an internal investigation, the Office handles information which suggests that there has been fraud, corruption or any other illegal activity affecting the financial interests of the Union, it may inform the institution, body, office or agency concerned. Upon request, the institution, body, office or agency concerned shall inform the Office of any action taken and of its findings on the basis of such information. Where necessary, the Office shall also inform the competent authorities of the Member State concerned. In this case, the procedural requirements laid down in the second and third subparagraphs of Article 9(4) shall apply. If the competent authorities decide to take any action on the basis of the information transmitted to them, in accordance with national law, they shall, upon request, inform the Office thereof.
Amendment rationale: CONTEXT OF THE PROPOSAL Reasons for and objectives of the proposal The Commission is pursuing an ambitious legislative agenda to strengthen the protection of the Union's financial interests. In July 2017, the Parliament and the Council adopted the Directive on the fight against fraud to the Union's financial interests by means of criminal law. In October 2017, the Council adopted the Regulation implementing enhanced cooperation on the establishment of the European Public Prosecutor's Office (EPPO). The establishment of the EPPO is a key Commission priority in the areas of criminal justice and the fight against fraud to the Union budget. The EPPO will change the EU institutional anti-fraud landscape significantly. It will have the power to conduct criminal investigations and prosecute before the courts of the participating Member States. It is expected to bring a more consistent and effective prosecution policy for crimes affecting the Union budget, leading to more prosecutions, convictions and a higher level of recovery. As a consequence of the adoption of the EPPO Regulation, Regulation No 883/2013 governing investigations by the European Anti-Fraud Office (OLAF) needs to be adapted. OLAF was set up in 1999 with the task, in particular, of conducting administrative investigations in the area of the protection of the Union's financial interests. Within its administrative mandate, OLAF investigates administrative irregularities as well as criminal behaviour. It plays a significant role in the fight against fraud, corruption and other illegal activities through its investigations aimed at enabling financial recoveries, disciplinary and administrative action, as well as indictments and prosecutions. OLAF has used its investigative expertise in a constantly developing context of fraud to the Union budget. It has handled increasing numbers of investigations, leading to increasing numbers of recommendations and amounts recommended for recovery. In the area of fraud, the creation of the EPPO will be a substantial improvement to the current situation. Today, OLAF carries out administrative investigations using administrative powers which are limited compared to criminal investigations. When it encounters possible criminal offences, it can only address a recommendation to national judicial authorities, but with no guarantees as to whether a criminal investigation will be opened. In future, in the Member States participating in the EPPO, it will report such suspected offences to the EPPO, and collaborate with it in the context of its investigations. Provisions to regulate the relationship between the EPPO and OLAF already exist in the EPPO Regulation. They are based on the principles of close cooperation, exchange of information, complementarity and non-duplication. These rules need to be mirrored and complemented in Regulation No 883/2013. The adaptation of the OLAF legal framework by the time the EPPO becomes operational is therefore the main driver for the amendment of Regulation No 883/2013. To ensure a smooth transition into the new framework, the amended Regulation should enter into force before the EPPO becomes operational (envisaged for the end of 2020). The EPPO and OLAF are both, within their respective remits, entrusted with the mandate to protect the Union's financial interests. While the EPPO will conduct criminal investigations aimed at investigating, prosecuting and bringing to judgment the perpetrators of, and accomplices to, offences affecting the financial interests of the Union, OLAF will continue conducting administrative investigations with a particular emphasis on facilitating administrative recovery and preventing further harm to the EU finances through administrative measures. Thus, the focus of activity of the future EPPO and of OLAF is distinct, although they converge towards a common goal. OLAF will also continue its investigations, in the same way as today, in the Member States not participating in the EPPO at this stage. In these Member States, the national authorities as well as OLAF should contribute to creating the conditions to ensure an effective and equivalent level of protection of the Union’s financial interests in the whole EU. In such circumstances, it is essential that the legal framework for OLAF is fit-for-purpose to allow it to fulfil its role with regard to the EPPO, the Member States and Union institutions, bodies, offices and agencies. The Commission evaluation of Regulation No 883/2013 concluded that the Regulation allowed OLAF to continue delivering concrete results in the protection of the Union budget. The 2013 changes brought clear improvements, as regards the conduct of investigations, cooperation with partners and the rights of persons concerned. At the same time, the evaluation highlighted shortcomings which impact on the effectiveness and efficiency of investigations. These findings relate to a wide range of areas including OLAF’s investigative tools, the enforcement of OLAF powers, uniform conditions in the conduct of internal investigations, the conduct of digital forensic operations, divergences in the follow-up to OLAF recommendations, the duties of cooperation by Member States and Union institutions, bodies, offices and agencies, or the overall coherence of the legal framework. However, addressing all evaluation findings is outside the scope of this proposal, as the revised Regulation should be in force by the time the EPPO becomes operational. The proposal therefore contains a limited number of targeted changes, based on the most unambiguous evaluation findings. These are essential changes necessary in the short term to strengthen the framework for OLAF investigations, in order to maintain a strong and fully-functioning OLAF that complements the EPPO's criminal law approach with administrative investigations, but which do not entail a change to its mandate or powers. The focus is on areas where, today, the lack of clarity of certain provisions in the current Regulation results in obstacles which hinder OLAF’s effective operations, regarding, notably, on-the-spot-checks and inspections or access to bank account information. The amendments proposed aim to clarify and reduce ambiguity in the current provisions for the economic operators concerned, for the Member States, and for OLAF, thus enhancing legal certainty. They would allow OLAF to operate in an effective and more coherent manner in all its investigations. This is directly related to the objectives of a strong protection of the budget across the Union coupled with appropriate procedural safeguards for economic operators subject to investigation. The overall objective of the proposal is to strengthen the protection of the Union's financial interests. This will be achieved by three specific objectives to: – adapt the operation of OLAF to the establishment of the EPPO; – enhance the effectiveness of OLAF’s investigative function; – clarify and simplify selected provisions of Regulation No 883/2013. The Commission evaluation report already indicated that the proposal containing these targeted changes could be followed by a more far-reaching process to modernise the OLAF framework, which in its core aspects dates from the creation of OLAF in 1999. This would be the opportunity to consider other more fundamental changes in the context of 21st century fraud areas and trends, and it should take account of the experience gained in the cooperation between the EPPO and OLAF. It would also allow considering other evaluation findings, as well as aspects of the legal framework where further reflection and discussion may be needed.
Revised version (Article 4 Internal investigations):
1. Investigations within the institutions, bodies, offices and agencies in the areas referred to in Article 1 shall be conducted in accordance with this Regulation and with the decisions adopted by the relevant institution, body, office or agency (‘internal investigations’). 2. In the course of internal investigations: (a) the Office shall have the right of immediate and unannounced access to any relevant information and data, relating to the matter under investigation, irrespective of the type of medium on which it is stored, held by the institutions, bodies, offices and agencies, and to their premises. Where privately owned devices are used for work purposes, those devices may be subject to inspection by the Office. The Office shall subject such devices to inspection only to the extent that the devices are used for work purposes, under the conditions set in the decisions adopted by the relevant institution, body, office or agency and where the Office has reasonable grounds for suspecting that their content may be relevant for the investigation. The Office shall be empowered to inspect the accounts of the institutions, bodies, offices and agencies. The Office may take a copy of, and obtain extracts from, any document or the contents of any data medium held by the institutions, bodies, offices and agencies and, if necessary, assume custody of such documents or data to ensure that there is no danger of their disappearance; (b) the Office may request oral information, including through interviews, and written information from officials, other servants, members of institutions or bodies, heads of offices or agencies, or staff members, thoroughly documented in accordance with the applicable Union confidentiality and data protection rules. 3. Under the same rules and conditions as provided for in Article 3, the Office may carry out on-the-spot checks and inspections at the premises of economic operators in order to obtain access to information relevant to the matter under investigation within the institutions, bodies, offices and agencies. 4. The institutions, bodies, offices and agencies shall be informed whenever the staff of the Office conduct an internal investigation on their premises, consult documents or data, or request information held by them. Without prejudice to Articles 10 and 11, the Office may at any time forward to the institution, body, office or agency concerned the information obtained in the course of internal investigations. 5. The institutions, bodies, offices and agencies shall put in place appropriate procedures and take necessary measures to ensure at all stages the confidentiality of internal investigations. 6. Where internal investigations reveal that an official, other servant, member of an institution or body, head of office or agency, or staff member may be a person concerned, the institution, body, office or agency to which that person belongs shall be informed. In cases where the confidentiality of the internal investigation cannot be ensured using the usual channels of communication, the Office shall use appropriate alternative channels for transmitting information. In exceptional cases, the provision of such information may be deferred on the basis of a reasoned decision by the Director-General, which shall be transmitted to the Supervisory Committee after the closure of the investigation. 7. The decision to be adopted by each institution, body, office or agency as provided for in paragraph 1 shall include, in particular, a rule concerning a duty on the part of officials, other servants, members of institutions or bodies, heads of offices or agencies, or staff members to cooperate with and supply information to the Office, while ensuring the confidentiality of the internal investigation. 8. Without prejudice to Article 12c(1), where, before a decision has been taken whether or not to open an internal investigation, the Office handles information which suggests that there has been fraud, corruption or any other illegal activity affecting the financial interests of the Union, it may inform the institution, body, office or agency concerned. Upon request, the institution, body, office or agency concerned shall inform the Office of any action taken and of its findings on the basis of such information. Where necessary, the Office shall also inform the competent authorities of the Member State concerned. In this case, the procedural requirements laid down in the second and third subparagraphs of Article 9(4) shall apply. If the competent authorities decide to take any action on the basis of the information transmitted to them, in accordance with national law, they shall, upon request, inform the Office thereof.
Article 5 Opening of investigations
1. The Director-General may open an investigation when there is a sufficient suspicion, which may also be based on information provided by any third party or anonymous information, that there has been fraud, corruption or any other illegal activity affecting the financial interests of the Union. The decision by the Director-General whether or not to open an investigation shall take into account the investigation policy priorities and the annual management plan of the Office established in accordance with Article 17(5). That decision shall also take into account the need for efficient use of the Office’s resources and for proportionality of the means employed. With regard to internal investigations, specific account shall be taken of the institution, body, office or agency best placed to conduct them, based, in particular, on the nature of the facts, the actual or potential financial impact of the case, and the likelihood of any judicial follow-up. 2. The decision to open an external investigation shall be taken by the Director-General, acting on his own initiative or following a request from a Member State concerned or any institution, body, office or agency of the Union. The decision to open an internal investigation shall be taken by the Director-General, acting on his own initiative or following a request from the institution, body, office or agency within which the investigation is to be conducted or from a Member State. 3. While the Director-General is considering whether or not to open an internal investigation following a request as referred to in paragraph 2, and/or while the Office is conducting an internal investigation, the institutions, bodies, offices or agencies concerned shall not open a parallel investigation into the same facts, unless agreed otherwise with the Office. 4. Within two months of receipt by the Office of a request as referred to in paragraph 2, a decision whether or not to open an investigation shall be taken. It shall be communicated without delay to the Member State, institution, body, office or agency which made the request. Reasons shall be given for a decision not to open an investigation. If, on the expiry of that period of two months, the Office has not taken any decision, the Office shall be deemed to have decided not to open an investigation. Where an official, other servant, member of an institution or body, head of office or agency, or staff member, acting in accordance with Article 22a of the Staff Regulations, provides information to the Office relating to a suspected fraud or irregularity, the Office shall inform that person of the decision whether or not to open an investigation in relation to the facts in question. 5. If the Director-General decides not to open an internal investigation, he may without delay send any relevant information to the institution, body, office or agency concerned for appropriate action to be taken in accordance with the rules applicable to that institution, body, office or agency. The Office shall agree with that institution, body, office or agency, if appropriate, on suitable measures to protect the confidentiality of the source of that information and shall, if necessary, ask to be informed of the action taken. 6. If the Director-General decides not to open an external investigation, he may without delay send any relevant information to the competent authorities of the Member State concerned for action to be taken where appropriate, in accordance with its national rules. Where necessary, the Office shall also inform the institution, body, office or agency concerned.
Amendment rationale: CONTEXT OF THE PROPOSAL Reasons for and objectives of the proposal The Commission is pursuing an ambitious legislative agenda to strengthen the protection of the Union's financial interests. In July 2017, the Parliament and the Council adopted the Directive on the fight against fraud to the Union's financial interests by means of criminal law. In October 2017, the Council adopted the Regulation implementing enhanced cooperation on the establishment of the European Public Prosecutor's Office (EPPO). The establishment of the EPPO is a key Commission priority in the areas of criminal justice and the fight against fraud to the Union budget. The EPPO will change the EU institutional anti-fraud landscape significantly. It will have the power to conduct criminal investigations and prosecute before the courts of the participating Member States. It is expected to bring a more consistent and effective prosecution policy for crimes affecting the Union budget, leading to more prosecutions, convictions and a higher level of recovery. As a consequence of the adoption of the EPPO Regulation, Regulation No 883/2013 governing investigations by the European Anti-Fraud Office (OLAF) needs to be adapted. OLAF was set up in 1999 with the task, in particular, of conducting administrative investigations in the area of the protection of the Union's financial interests. Within its administrative mandate, OLAF investigates administrative irregularities as well as criminal behaviour. It plays a significant role in the fight against fraud, corruption and other illegal activities through its investigations aimed at enabling financial recoveries, disciplinary and administrative action, as well as indictments and prosecutions. OLAF has used its investigative expertise in a constantly developing context of fraud to the Union budget. It has handled increasing numbers of investigations, leading to increasing numbers of recommendations and amounts recommended for recovery. In the area of fraud, the creation of the EPPO will be a substantial improvement to the current situation. Today, OLAF carries out administrative investigations using administrative powers which are limited compared to criminal investigations. When it encounters possible criminal offences, it can only address a recommendation to national judicial authorities, but with no guarantees as to whether a criminal investigation will be opened. In future, in the Member States participating in the EPPO, it will report such suspected offences to the EPPO, and collaborate with it in the context of its investigations. Provisions to regulate the relationship between the EPPO and OLAF already exist in the EPPO Regulation. They are based on the principles of close cooperation, exchange of information, complementarity and non-duplication. These rules need to be mirrored and complemented in Regulation No 883/2013. The adaptation of the OLAF legal framework by the time the EPPO becomes operational is therefore the main driver for the amendment of Regulation No 883/2013. To ensure a smooth transition into the new framework, the amended Regulation should enter into force before the EPPO becomes operational (envisaged for the end of 2020). The EPPO and OLAF are both, within their respective remits, entrusted with the mandate to protect the Union's financial interests. While the EPPO will conduct criminal investigations aimed at investigating, prosecuting and bringing to judgment the perpetrators of, and accomplices to, offences affecting the financial interests of the Union, OLAF will continue conducting administrative investigations with a particular emphasis on facilitating administrative recovery and preventing further harm to the EU finances through administrative measures. Thus, the focus of activity of the future EPPO and of OLAF is distinct, although they converge towards a common goal. OLAF will also continue its investigations, in the same way as today, in the Member States not participating in the EPPO at this stage. In these Member States, the national authorities as well as OLAF should contribute to creating the conditions to ensure an effective and equivalent level of protection of the Union’s financial interests in the whole EU. In such circumstances, it is essential that the legal framework for OLAF is fit-for-purpose to allow it to fulfil its role with regard to the EPPO, the Member States and Union institutions, bodies, offices and agencies. The Commission evaluation of Regulation No 883/2013 concluded that the Regulation allowed OLAF to continue delivering concrete results in the protection of the Union budget. The 2013 changes brought clear improvements, as regards the conduct of investigations, cooperation with partners and the rights of persons concerned. At the same time, the evaluation highlighted shortcomings which impact on the effectiveness and efficiency of investigations. These findings relate to a wide range of areas including OLAF’s investigative tools, the enforcement of OLAF powers, uniform conditions in the conduct of internal investigations, the conduct of digital forensic operations, divergences in the follow-up to OLAF recommendations, the duties of cooperation by Member States and Union institutions, bodies, offices and agencies, or the overall coherence of the legal framework. However, addressing all evaluation findings is outside the scope of this proposal, as the revised Regulation should be in force by the time the EPPO becomes operational. The proposal therefore contains a limited number of targeted changes, based on the most unambiguous evaluation findings. These are essential changes necessary in the short term to strengthen the framework for OLAF investigations, in order to maintain a strong and fully-functioning OLAF that complements the EPPO's criminal law approach with administrative investigations, but which do not entail a change to its mandate or powers. The focus is on areas where, today, the lack of clarity of certain provisions in the current Regulation results in obstacles which hinder OLAF’s effective operations, regarding, notably, on-the-spot-checks and inspections or access to bank account information. The amendments proposed aim to clarify and reduce ambiguity in the current provisions for the economic operators concerned, for the Member States, and for OLAF, thus enhancing legal certainty. They would allow OLAF to operate in an effective and more coherent manner in all its investigations. This is directly related to the objectives of a strong protection of the budget across the Union coupled with appropriate procedural safeguards for economic operators subject to investigation. The overall objective of the proposal is to strengthen the protection of the Union's financial interests. This will be achieved by three specific objectives to: – adapt the operation of OLAF to the establishment of the EPPO; – enhance the effectiveness of OLAF’s investigative function; – clarify and simplify selected provisions of Regulation No 883/2013. The Commission evaluation report already indicated that the proposal containing these targeted changes could be followed by a more far-reaching process to modernise the OLAF framework, which in its core aspects dates from the creation of OLAF in 1999. This would be the opportunity to consider other more fundamental changes in the context of 21st century fraud areas and trends, and it should take account of the experience gained in the cooperation between the EPPO and OLAF. It would also allow considering other evaluation findings, as well as aspects of the legal framework where further reflection and discussion may be needed.
Revised version (Article 5 Opening of investigations):
1. Without prejudice to Article 12d, the Director-General may open an investigation when there is a sufficient suspicion, which may be based on information provided by any third party or on anonymous information, that there has been fraud, corruption or any other illegal activity affecting the financial interests of the Union. The decision to open the investigation may take into account the need for efficient use of the Office’s resources and for the proportionality of the means employed. With regard to internal investigations, specific account shall be taken of the institution, body, office or agency best placed to conduct them, based, in particular, on the nature of the facts, the actual or potential financial impact of the case, and the likelihood of any judicial follow-up. 2. The decision to open an investigation shall be taken by the Director-General, acting on his or her own initiative or following a request from an institution, body, office or agency or from a Member State. 3. While the Director-General is considering whether or not to open an internal investigation following a request as referred to in paragraph 2, or while the Office is conducting an internal investigation, the institutions, bodies, offices or agencies concerned shall not open a parallel investigation into the same facts, unless agreed otherwise with the Office. This paragraph shall not apply to investigations by the EPPO pursuant to Regulation (EU) 2017/1939. 4. Within two months of receipt by the Office of a request as referred to in paragraph 2, a decision whether or not to open an investigation shall be taken. It shall be communicated without delay to the Member State, institution, body, office or agency which made the request. Reasons shall be given for a decision not to open an investigation. If, on the expiry of that period of two months, the Office has not taken any decision, the Office shall be deemed to have decided not to open an investigation. Where an official, other servant, member of an institution or body, head of office or agency, or staff member, acting in accordance with Article 22a of the Staff Regulations, provides information to the Office relating to a suspected fraud or irregularity, the Office shall inform that person of the decision whether or not to open an investigation in relation to the facts in question. 5. If the Director-General decides not to open an investigation, he or she may without delay send any relevant information, as appropriate, to the competent authorities of the Member State concerned for appropriate action to be taken in accordance with Union and national law or to the institution, body, office or agency concerned for appropriate action to be taken in accordance with the rules applicable to that institution, body, office or agency. The Office shall agree with that institution, body, office or agency, if appropriate, on suitable measures to protect the confidentiality of the source of that information and shall, if necessary, ask to be informed of the action taken. 6. Where the Director-General decides not to open an investigation despite there being a sufficient suspicion that there has been fraud, corruption or any other illegal activity affecting the financial interests of the Union, he or she shall send the information referred to in paragraph 5 without delay.
Article 6 Access to information in databases prior to the opening of an investigation
1. Prior to the opening of an investigation, the Office shall have the right of access to any relevant information in databases held by the institutions, bodies, offices or agencies when this is indispensable in order to assess the basis in fact of allegations. That right of access shall be exercised within the time-limit, to be set by the Office, required for a prompt assessment of the allegations. In exercising that right of access, the Office shall respect the principles of necessity and proportionality. 2. The institution, body, office or agency concerned shall sincerely cooperate by allowing the Office to obtain any relevant information under conditions to be specified in the decisions adopted under Article 4(1).
Article 7 Investigations procedure
1. The Director-General shall direct the conduct of investigations on the basis, where appropriate, of written instructions. Investigations shall be conducted under his direction by the staff of the Office designated by him. 2. The staff of the Office shall carry out their tasks on production of a written authorisation showing their identity and their capacity. The Director-General shall issue such authorisation indicating the subject matter and the purpose of the investigation, the legal bases for conducting the investigation and the investigative powers stemming from those bases. 3. The competent authorities of the Member States shall, in conformity with national rules, give the necessary assistance to enable the staff of the Office to fulfil their tasks effectively. The institutions, bodies, offices and agencies shall ensure that their officials, other servants, members, heads and staff members provide the necessary assistance to enable the staff of the Office to fulfil their tasks effectively. 4. Where an investigation combines external and internal elements, Articles 3 and 4 shall apply respectively. 5. Investigations shall be conducted continuously over a period which must be proportionate to the circumstances and complexity of the case. 6. Where investigations show that it might be appropriate to take precautionary administrative measures to protect the financial interests of the Union, the Office shall without delay inform the institution, body, office or agency concerned of the investigation in progress. The information supplied shall include the following: (a) the identity of the official, other servant, member of an institution or body, head of office or agency, or staff member concerned and a summary of the facts in question; (b) any information that could assist the institution, body, office or agency concerned in deciding whether it is appropriate to take precautionary administrative measures in order to protect the financial interests of the Union; (c) any special measures of confidentiality recommended, in particular in cases entailing the use of investigative measures falling within the competence of a national judicial authority or, in the case of an external investigation, within the competence of a national authority, in accordance with the national rules applicable to investigations. The institution, body, office or agency concerned may at any time decide to take, in close cooperation with the Office, any appropriate precautionary measures, including measures for the safeguarding of evidence, and shall inform the Office without delay of such decision. 7. Where necessary, it shall be for the competent authorities of the Member States, at the Office’s request, to take the appropriate precautionary measures under their national law, in particular measures for the safeguarding of evidence. 8. If an investigation cannot be closed within 12 months after it has been opened, the Director-General shall, at the expiry of that 12-month period and every six months thereafter, report to the Supervisory Committee, indicating the reasons and the remedial measures envisaged with a view to speeding up the investigation.
Amendment rationale: CONTEXT OF THE PROPOSAL Reasons for and objectives of the proposal The Commission is pursuing an ambitious legislative agenda to strengthen the protection of the Union's financial interests. In July 2017, the Parliament and the Council adopted the Directive on the fight against fraud to the Union's financial interests by means of criminal law. In October 2017, the Council adopted the Regulation implementing enhanced cooperation on the establishment of the European Public Prosecutor's Office (EPPO). The establishment of the EPPO is a key Commission priority in the areas of criminal justice and the fight against fraud to the Union budget. The EPPO will change the EU institutional anti-fraud landscape significantly. It will have the power to conduct criminal investigations and prosecute before the courts of the participating Member States. It is expected to bring a more consistent and effective prosecution policy for crimes affecting the Union budget, leading to more prosecutions, convictions and a higher level of recovery. As a consequence of the adoption of the EPPO Regulation, Regulation No 883/2013 governing investigations by the European Anti-Fraud Office (OLAF) needs to be adapted. OLAF was set up in 1999 with the task, in particular, of conducting administrative investigations in the area of the protection of the Union's financial interests. Within its administrative mandate, OLAF investigates administrative irregularities as well as criminal behaviour. It plays a significant role in the fight against fraud, corruption and other illegal activities through its investigations aimed at enabling financial recoveries, disciplinary and administrative action, as well as indictments and prosecutions. OLAF has used its investigative expertise in a constantly developing context of fraud to the Union budget. It has handled increasing numbers of investigations, leading to increasing numbers of recommendations and amounts recommended for recovery. In the area of fraud, the creation of the EPPO will be a substantial improvement to the current situation. Today, OLAF carries out administrative investigations using administrative powers which are limited compared to criminal investigations. When it encounters possible criminal offences, it can only address a recommendation to national judicial authorities, but with no guarantees as to whether a criminal investigation will be opened. In future, in the Member States participating in the EPPO, it will report such suspected offences to the EPPO, and collaborate with it in the context of its investigations. Provisions to regulate the relationship between the EPPO and OLAF already exist in the EPPO Regulation. They are based on the principles of close cooperation, exchange of information, complementarity and non-duplication. These rules need to be mirrored and complemented in Regulation No 883/2013. The adaptation of the OLAF legal framework by the time the EPPO becomes operational is therefore the main driver for the amendment of Regulation No 883/2013. To ensure a smooth transition into the new framework, the amended Regulation should enter into force before the EPPO becomes operational (envisaged for the end of 2020). The EPPO and OLAF are both, within their respective remits, entrusted with the mandate to protect the Union's financial interests. While the EPPO will conduct criminal investigations aimed at investigating, prosecuting and bringing to judgment the perpetrators of, and accomplices to, offences affecting the financial interests of the Union, OLAF will continue conducting administrative investigations with a particular emphasis on facilitating administrative recovery and preventing further harm to the EU finances through administrative measures. Thus, the focus of activity of the future EPPO and of OLAF is distinct, although they converge towards a common goal. OLAF will also continue its investigations, in the same way as today, in the Member States not participating in the EPPO at this stage. In these Member States, the national authorities as well as OLAF should contribute to creating the conditions to ensure an effective and equivalent level of protection of the Union’s financial interests in the whole EU. In such circumstances, it is essential that the legal framework for OLAF is fit-for-purpose to allow it to fulfil its role with regard to the EPPO, the Member States and Union institutions, bodies, offices and agencies. The Commission evaluation of Regulation No 883/2013 concluded that the Regulation allowed OLAF to continue delivering concrete results in the protection of the Union budget. The 2013 changes brought clear improvements, as regards the conduct of investigations, cooperation with partners and the rights of persons concerned. At the same time, the evaluation highlighted shortcomings which impact on the effectiveness and efficiency of investigations. These findings relate to a wide range of areas including OLAF’s investigative tools, the enforcement of OLAF powers, uniform conditions in the conduct of internal investigations, the conduct of digital forensic operations, divergences in the follow-up to OLAF recommendations, the duties of cooperation by Member States and Union institutions, bodies, offices and agencies, or the overall coherence of the legal framework. However, addressing all evaluation findings is outside the scope of this proposal, as the revised Regulation should be in force by the time the EPPO becomes operational. The proposal therefore contains a limited number of targeted changes, based on the most unambiguous evaluation findings. These are essential changes necessary in the short term to strengthen the framework for OLAF investigations, in order to maintain a strong and fully-functioning OLAF that complements the EPPO's criminal law approach with administrative investigations, but which do not entail a change to its mandate or powers. The focus is on areas where, today, the lack of clarity of certain provisions in the current Regulation results in obstacles which hinder OLAF’s effective operations, regarding, notably, on-the-spot-checks and inspections or access to bank account information. The amendments proposed aim to clarify and reduce ambiguity in the current provisions for the economic operators concerned, for the Member States, and for OLAF, thus enhancing legal certainty. They would allow OLAF to operate in an effective and more coherent manner in all its investigations. This is directly related to the objectives of a strong protection of the budget across the Union coupled with appropriate procedural safeguards for economic operators subject to investigation. The overall objective of the proposal is to strengthen the protection of the Union's financial interests. This will be achieved by three specific objectives to: – adapt the operation of OLAF to the establishment of the EPPO; – enhance the effectiveness of OLAF’s investigative function; – clarify and simplify selected provisions of Regulation No 883/2013. The Commission evaluation report already indicated that the proposal containing these targeted changes could be followed by a more far-reaching process to modernise the OLAF framework, which in its core aspects dates from the creation of OLAF in 1999. This would be the opportunity to consider other more fundamental changes in the context of 21st century fraud areas and trends, and it should take account of the experience gained in the cooperation between the EPPO and OLAF. It would also allow considering other evaluation findings, as well as aspects of the legal framework where further reflection and discussion may be needed.
Revised version (Article 7 Investigations procedure):
1. The Director-General shall direct the conduct of investigations on the basis, where appropriate, of written instructions. Investigations shall be conducted under his or her direction by the staff of the Office designated by him or her. The Director-General shall not personally carry out concrete investigative acts. 2. The staff of the Office shall carry out their tasks on production of a written authorisation showing their identity and their capacity. The Director-General shall issue such authorisation indicating the subject matter and the purpose of the investigation, the legal bases for conducting the investigation and the investigative powers stemming from those bases. 3. The competent authorities of Member States shall give the necessary assistance to enable the staff of the Office to fulfil their tasks in accordance with this Regulation effectively and without undue delay. When providing such assistance, the competent authorities of Member States shall act in accordance with any national procedural rules applicable to them. 3b. The institutions, bodies, offices and agencies shall ensure that their officials, other servants, members, heads and staff members provide the necessary assistance to enable the staff of the Office to fulfil their tasks effectively and without undue delay. 4. Where an investigation combines external and internal elements, Articles 3 and 4 shall apply respectively. 5. Investigations shall be conducted continuously over a period which must be proportionate to the circumstances and complexity of the case. The institution, body, office or agency concerned may at any time consult the Office with a view to taking, in close cooperation with the Office, any appropriate precautionary measures, including measures for the safeguarding of evidence. The institution, body, office or agency concerned shall inform the Office without delay about any precautionary measures taken. 7. Where necessary, it shall be for the competent authorities of the Member States, at the Office’s request, to take the appropriate precautionary measures under their national law, in particular measures for the safeguarding of evidence. 8. If an investigation cannot be closed within 12 months after it has been opened, the Director-General shall, at the expiry of that 12-month period and every six months thereafter, report to the Supervisory Committee, indicating the reasons and, where appropriate, the remedial measures envisaged with a view to speeding up the investigation.
Article 8 Duty to inform the Office
1. The institutions, bodies, offices and agencies shall transmit to the Office without delay any information relating to possible cases of fraud, corruption or any other illegal activity affecting the financial interests of the Union. 2. The institutions, bodies, offices and agencies and, in so far as their national law allows, the competent authorities of the Member States shall, at the request of the Office or on their own initiative, transmit to the Office any document or information they hold which relates to an ongoing investigation by the Office. 3. The institutions, bodies, offices and agencies and, in so far as their national law allows, the competent authorities of the Member States shall transmit to the Office any other document or information considered pertinent which they hold relating to the fight against fraud, corruption and any other illegal activity affecting the financial interests of the Union.
Amendment rationale: CONTEXT OF THE PROPOSAL Reasons for and objectives of the proposal The Commission is pursuing an ambitious legislative agenda to strengthen the protection of the Union's financial interests. In July 2017, the Parliament and the Council adopted the Directive on the fight against fraud to the Union's financial interests by means of criminal law. In October 2017, the Council adopted the Regulation implementing enhanced cooperation on the establishment of the European Public Prosecutor's Office (EPPO). The establishment of the EPPO is a key Commission priority in the areas of criminal justice and the fight against fraud to the Union budget. The EPPO will change the EU institutional anti-fraud landscape significantly. It will have the power to conduct criminal investigations and prosecute before the courts of the participating Member States. It is expected to bring a more consistent and effective prosecution policy for crimes affecting the Union budget, leading to more prosecutions, convictions and a higher level of recovery. As a consequence of the adoption of the EPPO Regulation, Regulation No 883/2013 governing investigations by the European Anti-Fraud Office (OLAF) needs to be adapted. OLAF was set up in 1999 with the task, in particular, of conducting administrative investigations in the area of the protection of the Union's financial interests. Within its administrative mandate, OLAF investigates administrative irregularities as well as criminal behaviour. It plays a significant role in the fight against fraud, corruption and other illegal activities through its investigations aimed at enabling financial recoveries, disciplinary and administrative action, as well as indictments and prosecutions. OLAF has used its investigative expertise in a constantly developing context of fraud to the Union budget. It has handled increasing numbers of investigations, leading to increasing numbers of recommendations and amounts recommended for recovery. In the area of fraud, the creation of the EPPO will be a substantial improvement to the current situation. Today, OLAF carries out administrative investigations using administrative powers which are limited compared to criminal investigations. When it encounters possible criminal offences, it can only address a recommendation to national judicial authorities, but with no guarantees as to whether a criminal investigation will be opened. In future, in the Member States participating in the EPPO, it will report such suspected offences to the EPPO, and collaborate with it in the context of its investigations. Provisions to regulate the relationship between the EPPO and OLAF already exist in the EPPO Regulation. They are based on the principles of close cooperation, exchange of information, complementarity and non-duplication. These rules need to be mirrored and complemented in Regulation No 883/2013. The adaptation of the OLAF legal framework by the time the EPPO becomes operational is therefore the main driver for the amendment of Regulation No 883/2013. To ensure a smooth transition into the new framework, the amended Regulation should enter into force before the EPPO becomes operational (envisaged for the end of 2020). The EPPO and OLAF are both, within their respective remits, entrusted with the mandate to protect the Union's financial interests. While the EPPO will conduct criminal investigations aimed at investigating, prosecuting and bringing to judgment the perpetrators of, and accomplices to, offences affecting the financial interests of the Union, OLAF will continue conducting administrative investigations with a particular emphasis on facilitating administrative recovery and preventing further harm to the EU finances through administrative measures. Thus, the focus of activity of the future EPPO and of OLAF is distinct, although they converge towards a common goal. OLAF will also continue its investigations, in the same way as today, in the Member States not participating in the EPPO at this stage. In these Member States, the national authorities as well as OLAF should contribute to creating the conditions to ensure an effective and equivalent level of protection of the Union’s financial interests in the whole EU. In such circumstances, it is essential that the legal framework for OLAF is fit-for-purpose to allow it to fulfil its role with regard to the EPPO, the Member States and Union institutions, bodies, offices and agencies. The Commission evaluation of Regulation No 883/2013 concluded that the Regulation allowed OLAF to continue delivering concrete results in the protection of the Union budget. The 2013 changes brought clear improvements, as regards the conduct of investigations, cooperation with partners and the rights of persons concerned. At the same time, the evaluation highlighted shortcomings which impact on the effectiveness and efficiency of investigations. These findings relate to a wide range of areas including OLAF’s investigative tools, the enforcement of OLAF powers, uniform conditions in the conduct of internal investigations, the conduct of digital forensic operations, divergences in the follow-up to OLAF recommendations, the duties of cooperation by Member States and Union institutions, bodies, offices and agencies, or the overall coherence of the legal framework. However, addressing all evaluation findings is outside the scope of this proposal, as the revised Regulation should be in force by the time the EPPO becomes operational. The proposal therefore contains a limited number of targeted changes, based on the most unambiguous evaluation findings. These are essential changes necessary in the short term to strengthen the framework for OLAF investigations, in order to maintain a strong and fully-functioning OLAF that complements the EPPO's criminal law approach with administrative investigations, but which do not entail a change to its mandate or powers. The focus is on areas where, today, the lack of clarity of certain provisions in the current Regulation results in obstacles which hinder OLAF’s effective operations, regarding, notably, on-the-spot-checks and inspections or access to bank account information. The amendments proposed aim to clarify and reduce ambiguity in the current provisions for the economic operators concerned, for the Member States, and for OLAF, thus enhancing legal certainty. They would allow OLAF to operate in an effective and more coherent manner in all its investigations. This is directly related to the objectives of a strong protection of the budget across the Union coupled with appropriate procedural safeguards for economic operators subject to investigation. The overall objective of the proposal is to strengthen the protection of the Union's financial interests. This will be achieved by three specific objectives to: – adapt the operation of OLAF to the establishment of the EPPO; – enhance the effectiveness of OLAF’s investigative function; – clarify and simplify selected provisions of Regulation No 883/2013. The Commission evaluation report already indicated that the proposal containing these targeted changes could be followed by a more far-reaching process to modernise the OLAF framework, which in its core aspects dates from the creation of OLAF in 1999. This would be the opportunity to consider other more fundamental changes in the context of 21st century fraud areas and trends, and it should take account of the experience gained in the cooperation between the EPPO and OLAF. It would also allow considering other evaluation findings, as well as aspects of the legal framework where further reflection and discussion may be needed.
Revised version (Article 8 Duty to inform the Office):
1. In the areas referred to in Article 1, the institutions, bodies, offices and agencies shall transmit to the Office without delay any information relating to possible cases of fraud, corruption or any other illegal activity affecting the financial interests of the Union. Where the institutions, bodies, offices and agencies report to the EPPO in accordance with Article 24 of Regulation (EU) 2017/1939, they may comply with the obligation set out in the first subparagraph of this paragraph by transmitting to the Office a copy of the report sent to the EPPO. 2. The institutions, bodies, offices and agencies and, unless prevented by national law, the competent authorities of Member States shall, at the request of the Office or on their own initiative, transmit without delay to the Office any document or information they hold which relates to an ongoing investigation by the Office. Prior to the opening of an investigation they shall, at the request of the Office, which shall be explained in writing,transmit any document or information they hold which is necessary to assess the allegations or to apply the criteria for opening an investigation as set out in Article 5(1). 3. The institutions, bodies, offices and agencies and, unless prevented by national law, the competent authorities of Member States shall transmit without delay to the Office, at the request of the Office or on their own initiative, any other information, documents or data considered pertinent which they hold, relating to the fight against fraud, corruption and any other illegal activity affecting the financial interests of the Union. 4. This Article shall not apply to the EPPO as regards the criminal offences in respect of which it could exercise its competence in accordance with Chapter IV of Regulation (EU) 2017/1939. This is without prejudice to the possibility for the EPPO to provide the Office with relevant information on cases in accordance with Articles 34(8), 36(6), 39(4) and Article 101(3) and (4) of Regulation (EU) 2017/1939. 5. The provisions related to transmission of information in accordance with Council Regulation (EU) No 904/2010 ( 5 ) shall remain unaffected.
Article 9 Procedural guarantees
1. In its investigations the Office shall seek evidence for and against the person concerned. Investigations shall be conducted objectively and impartially and in accordance with the principle of the presumption of innocence and with the procedural guarantees set out in this Article. 2. The Office may interview a person concerned or a witness at any time during an investigation. Any person interviewed shall have the right to avoid self-incrimination. The invitation to an interview shall be sent to a person concerned with at least 10 working days’ notice. That notice period may be shortened with the express consent of the person concerned or on duly reasoned grounds of urgency of the investigation. In the latter case, the notice period shall not be less than 24 hours. The invitation shall include a list of the rights of the person concerned, in particular the right to be assisted by a person of his choice. The invitation to an interview shall be sent to a witness with at least 24 hours’ notice. That notice period may be shortened with the express consent of the witness or on duly reasoned grounds of urgency of the investigation. The requirements referred to in the second and third subparagraphs shall not apply to the taking of statements in the context of on-the-spot checks and inspections. Where, in the course of an interview, evidence emerges that a witness may be a person concerned, the interview shall be ended. The procedural rules provided for in this paragraph and in paragraphs 3 and 4 shall immediately apply. That witness shall be informed forthwith of his rights as a person concerned and shall receive, upon request, a copy of the records of any statements made by him in the past. The Office may not use that person’s past statements against him without giving him first the opportunity to comment on those statements. The Office shall draw up a record of the interview and give the person interviewed access to it so that the person interviewed may either approve the record or add observations. The Office shall give the person concerned a copy of the record of the interview. 3. As soon as an investigation reveals that an official, other servant, member of an institution or body, head of office or agency, or staff member may be a person concerned, that official, other servant, member of an institution or body, head of office or agency, or staff member shall be informed to that effect, provided that this does not prejudice the conduct of the investigation or of any investigative proceedings falling within the remit of a national judicial authority. 4. Without prejudice to Articles 4(6) and 7(6), once the investigation has been completed and before conclusions referring by name to a person concerned are drawn up, that person shall be given the opportunity to comment on facts concerning him. To that end, the Office shall send the person concerned an invitation to comment either in writing or at an interview with staff designated by the Office. That invitation shall include a summary of the facts concerning the person concerned and the information required by Articles 11 and 12 of Regulation (EC) No 45/2001, and shall indicate the time-limit for submitting comments, which shall not be less than 10 working days from receipt of the invitation to comment. That notice period may be shortened with the express consent of the person concerned or on duly reasoned grounds of urgency of the investigation. The final investigation report shall make reference to any such comments. In duly justified cases where it is necessary to preserve the confidentiality of the investigation and/or entailing the use of investigative proceedings falling within the remit of a national judicial authority, the Director-General may decide to defer the fulfilment of the obligation to invite the person concerned to comment. In cases referred to in Article 1(2) of Annex IX to the Staff Regulations, failure on the part of the institution, body, office or agency to respond within one month to the request of the Director-General for deferral of the fulfilment of the obligation to invite the person concerned to comment shall be deemed to constitute a reply in the affirmative. 5. Any person interviewed shall be entitled to use any of the official languages of the institutions of the Union. However, officials or other servants of the Union may be required to use an official language of the institutions of the Union of which they have a thorough knowledge.
Amendment rationale: CONTEXT OF THE PROPOSAL Reasons for and objectives of the proposal The Commission is pursuing an ambitious legislative agenda to strengthen the protection of the Union's financial interests. In July 2017, the Parliament and the Council adopted the Directive on the fight against fraud to the Union's financial interests by means of criminal law. In October 2017, the Council adopted the Regulation implementing enhanced cooperation on the establishment of the European Public Prosecutor's Office (EPPO). The establishment of the EPPO is a key Commission priority in the areas of criminal justice and the fight against fraud to the Union budget. The EPPO will change the EU institutional anti-fraud landscape significantly. It will have the power to conduct criminal investigations and prosecute before the courts of the participating Member States. It is expected to bring a more consistent and effective prosecution policy for crimes affecting the Union budget, leading to more prosecutions, convictions and a higher level of recovery. As a consequence of the adoption of the EPPO Regulation, Regulation No 883/2013 governing investigations by the European Anti-Fraud Office (OLAF) needs to be adapted. OLAF was set up in 1999 with the task, in particular, of conducting administrative investigations in the area of the protection of the Union's financial interests. Within its administrative mandate, OLAF investigates administrative irregularities as well as criminal behaviour. It plays a significant role in the fight against fraud, corruption and other illegal activities through its investigations aimed at enabling financial recoveries, disciplinary and administrative action, as well as indictments and prosecutions. OLAF has used its investigative expertise in a constantly developing context of fraud to the Union budget. It has handled increasing numbers of investigations, leading to increasing numbers of recommendations and amounts recommended for recovery. In the area of fraud, the creation of the EPPO will be a substantial improvement to the current situation. Today, OLAF carries out administrative investigations using administrative powers which are limited compared to criminal investigations. When it encounters possible criminal offences, it can only address a recommendation to national judicial authorities, but with no guarantees as to whether a criminal investigation will be opened. In future, in the Member States participating in the EPPO, it will report such suspected offences to the EPPO, and collaborate with it in the context of its investigations. Provisions to regulate the relationship between the EPPO and OLAF already exist in the EPPO Regulation. They are based on the principles of close cooperation, exchange of information, complementarity and non-duplication. These rules need to be mirrored and complemented in Regulation No 883/2013. The adaptation of the OLAF legal framework by the time the EPPO becomes operational is therefore the main driver for the amendment of Regulation No 883/2013. To ensure a smooth transition into the new framework, the amended Regulation should enter into force before the EPPO becomes operational (envisaged for the end of 2020). The EPPO and OLAF are both, within their respective remits, entrusted with the mandate to protect the Union's financial interests. While the EPPO will conduct criminal investigations aimed at investigating, prosecuting and bringing to judgment the perpetrators of, and accomplices to, offences affecting the financial interests of the Union, OLAF will continue conducting administrative investigations with a particular emphasis on facilitating administrative recovery and preventing further harm to the EU finances through administrative measures. Thus, the focus of activity of the future EPPO and of OLAF is distinct, although they converge towards a common goal. OLAF will also continue its investigations, in the same way as today, in the Member States not participating in the EPPO at this stage. In these Member States, the national authorities as well as OLAF should contribute to creating the conditions to ensure an effective and equivalent level of protection of the Union’s financial interests in the whole EU. In such circumstances, it is essential that the legal framework for OLAF is fit-for-purpose to allow it to fulfil its role with regard to the EPPO, the Member States and Union institutions, bodies, offices and agencies. The Commission evaluation of Regulation No 883/2013 concluded that the Regulation allowed OLAF to continue delivering concrete results in the protection of the Union budget. The 2013 changes brought clear improvements, as regards the conduct of investigations, cooperation with partners and the rights of persons concerned. At the same time, the evaluation highlighted shortcomings which impact on the effectiveness and efficiency of investigations. These findings relate to a wide range of areas including OLAF’s investigative tools, the enforcement of OLAF powers, uniform conditions in the conduct of internal investigations, the conduct of digital forensic operations, divergences in the follow-up to OLAF recommendations, the duties of cooperation by Member States and Union institutions, bodies, offices and agencies, or the overall coherence of the legal framework. However, addressing all evaluation findings is outside the scope of this proposal, as the revised Regulation should be in force by the time the EPPO becomes operational. The proposal therefore contains a limited number of targeted changes, based on the most unambiguous evaluation findings. These are essential changes necessary in the short term to strengthen the framework for OLAF investigations, in order to maintain a strong and fully-functioning OLAF that complements the EPPO's criminal law approach with administrative investigations, but which do not entail a change to its mandate or powers. The focus is on areas where, today, the lack of clarity of certain provisions in the current Regulation results in obstacles which hinder OLAF’s effective operations, regarding, notably, on-the-spot-checks and inspections or access to bank account information. The amendments proposed aim to clarify and reduce ambiguity in the current provisions for the economic operators concerned, for the Member States, and for OLAF, thus enhancing legal certainty. They would allow OLAF to operate in an effective and more coherent manner in all its investigations. This is directly related to the objectives of a strong protection of the budget across the Union coupled with appropriate procedural safeguards for economic operators subject to investigation. The overall objective of the proposal is to strengthen the protection of the Union's financial interests. This will be achieved by three specific objectives to: – adapt the operation of OLAF to the establishment of the EPPO; – enhance the effectiveness of OLAF’s investigative function; – clarify and simplify selected provisions of Regulation No 883/2013. The Commission evaluation report already indicated that the proposal containing these targeted changes could be followed by a more far-reaching process to modernise the OLAF framework, which in its core aspects dates from the creation of OLAF in 1999. This would be the opportunity to consider other more fundamental changes in the context of 21st century fraud areas and trends, and it should take account of the experience gained in the cooperation between the EPPO and OLAF. It would also allow considering other evaluation findings, as well as aspects of the legal framework where further reflection and discussion may be needed.
Revised version (Article 9 Procedural guarantees):
1. In its investigations the Office shall seek evidence for and against the person concerned. Investigations shall be conducted objectively and impartially and in accordance with the principle of the presumption of innocence and with the procedural guarantees set out in this Article. 2. The Office may interview a person concerned or a witness at any time during an investigation. Any person interviewed shall have the right to avoid self-incrimination. The invitation to an interview shall be sent to a person concerned with at least 10 working days’ notice. That notice period may be shortened with the express consent of the person concerned or on duly reasoned grounds of urgency of the investigation. In the latter case, the notice period shall not be less than 24 hours. The invitation shall include a list of the rights of the person concerned, in particular the right to be assisted by a person of his choice. The invitation to an interview shall be sent to a witness with at least 24 hours’ notice. That notice period may be shortened with the express consent of the witness or on duly reasoned grounds of urgency of the investigation. The requirements referred to in the second and third subparagraphs shall not apply to the taking of statements in the context of on-the-spot checks and inspections.The procedural guarantees as referred to in Article 3(7) and (8) shall apply to the person concerned, in particular the right to be assisted by a person of his or her choice. Where, in the course of an interview, evidence emerges that a witness may be a person concerned, the interview shall be ended. The procedural rules provided for in this paragraph and in paragraphs 3 and 4 shall immediately apply. That witness shall be informed forthwith of his rights as a person concerned and shall receive, upon request, a copy of the records of any statements made by him in the past. The Office may not use that person’s past statements against him without giving him first the opportunity to comment on those statements. The Office shall draw up a record of the interview and give the person interviewed access to it so that the person interviewed may either approve the record or add observations. The Office shall give the person concerned a copy of the record of the interview. 3. As soon as an investigation reveals that an official, other servant, member of an institution or body, head of office or agency, or staff member may be a person concerned, that official, other servant, member of an institution or body, head of office or agency, or staff member shall be informed to that effect, provided that this does not prejudice the conduct of the investigation or of any investigative proceedings falling within the remit of a national judicial authority. 4. Without prejudice to Articles 4(6) and 7(6), once the investigation has been completed and before conclusions referring by name to a person concerned are drawn up, that person shall be given the opportunity to comment on facts concerning him. To that end, the Office shall send the person concerned an invitation to comment either in writing or at an interview with staff designated by the Office. That invitation shall include a summary of the facts concerning the person concerned and the information required by Articles 15 and 16 of Regulation (EU) 2018/1725, and shall indicate the timelimit for submitting comments, which shall not be less than 10 working days from receipt of the invitation to comment. That notice period may be shortened with the express consent of the person concerned or on duly reasoned grounds of urgency of the investigation. The final investigation report shall make reference to any such comments. In duly justified cases where necessary to preserve the confidentiality of the investigation or an ongoing or future criminal investigation by the EPPO or a national judicial authority, the Director-General may, where appropriate after consulting the EPPO or the national judicial authority concerned, decide to defer the fulfilment of the obligation to invite the person concerned to comment. In cases referred to in Article 1(2) of Annex IX to the Staff Regulations, failure on the part of the institution, body, office or agency to respond within one month to the request of the Director-General for deferral of the fulfilment of the obligation to invite the person concerned to comment shall be deemed to constitute a reply in the affirmative. 5. Any person interviewed shall be entitled to use any of the official languages of the institutions of the Union. However, officials or other servants of the Union may be required to use an official language of the institutions of the Union of which they have a thorough knowledge.
Article 10 Confidentiality and data protection
1. Information transmitted or obtained in the course of external investigations, in whatever form, shall be protected by the relevant provisions. 2. Information transmitted or obtained in the course of internal investigations, in whatever form, shall be subject to professional secrecy and shall enjoy the protection afforded by the rules applicable to the Union institutions. 3. The institutions, bodies, offices or agencies concerned shall ensure that the confidentiality of the investigations conducted by the Office is respected, together with the legitimate rights of the persons concerned, and, where judicial proceedings have been initiated, that all national rules applicable to such proceedings have been adhered to. 4. The Office may designate a Data Protection Officer in accordance with Article 24 of Regulation (EC) No 45/2001. 5. The Director-General shall ensure that any information provided to the public is given neutrally and impartially, and that its disclosure respects the confidentiality of investigations and complies with the principles set out in this Article and in Article 9(1). In accordance with the Staff Regulations, the staff of the Office shall refrain from any unauthorised disclosure of information received in the line of duty, unless that information has already been made public or is accessible to the public, and shall continue to be bound by that obligation after leaving the service.
Amendment rationale: CONTEXT OF THE PROPOSAL Reasons for and objectives of the proposal The Supervisory Committee of the European Anti-Fraud Office was established by Regulation 1073/99 of 25 May 1999 concerning investigations conducted by the European Anti-Fraud Office (OLAF) 1 . Article 15(1) of the new OLAF Regulation 883/2013 of 11 September 2013 2 states that it tasks should be to "regularly monitor the implementation by the Office of its investigative function, in order to reinforce the Office's independence in the proper exercise of the competences conferred upon it by this Regulation" and, in particular, to "monitor developments concerning the application of procedural guarantees and the duration of investigations in the light of the information supplied by the Director General .. ". In its work, the Supervisory Committee is supported by a secretariat. Currently, this secretariat is provided by the OLAF, in accordance with Article 15(8) of the OLAF Regulation which states that the secretariat of the Supervisory Committee "shall be provided by the Office, in close consultation with the Supervisory Committee". Article 18 of the Regulation places the budgetary appropriations for the Supervisory Committee and its secretariat within the budget line of the Office and provides that the establishment plan of the Office includes that of the Supervisory Committee and of its secretariat. However, in the recent past some concerns have been voiced about possible conflicts of interest and calls have been made for a strengthened legal independence as regards the management of the Committee's budget and secretariat. Thus, in its Annual Activity Reports of 2013 and 2014 3 , the Supervisory Committee underlined the importance of its independent and effective functioning which requires an independent and adequately staffed secretariat. It stressed that the exercise of the Appointing Authority powers by OLAF's Director-General, including decisions on promotions and transfers, could potentially lead to conflicts of interest. It called for its budget and that of its secretariat to be specified in a separate line of the OLAF budget. The European Parliament called several times on the Commission to take measures to reinforce the independent functioning of OLAF's Supervisory Committee secretariat, such as in its report on the discharge procedure for 2013 4 or in its resolution on the OLAF Supervisory Committee's annual report 2014 5 . The issue has also been addressed in the Exchange of Views with the institutions established by Article 16 of the OLAF Regulation. During the exchange held on 28 September 2015, representatives from the European Parliament stressed again the need to strengthen the independent functioning of the Supervisory Committee's secretariat. On 18 December 2015, the Commission adopted an amendment to its Decision 1999/352 6 in order to move the responsibility for the implementation of the budgetary appropriations for the Members from the Director-General of OLAF to the Commission. The Commission subsequently delegated this responsibility to the Director of its Payments Office (PMO). This decision applied as from 1 January 2016. The objective of this decision was to avoid the appearance that the Members of the Supervisory Committee might not be in a position to ensure their mandate properly. This decision could, however, not achieve a full legal separation of the Committee's secretariat and budget from the Office. In order to separate the management of the Committee's secretariat from the management of the Office and to avoid any impression that OLAF can impair the functioning of the support to the Committee's Members, it is necessary to modify Regulation 883/2013 to foresee that the secretariat of the Supervisory Committee will be provided directly by the Commission. This modification will not affect the independence and operational functioning of the Supervisory Committee and of its Secretariat, who will continue to benefit from the same rights and be subject to the same obligations as before. In particular, OLAF's Data Protection Officer (DPO) will continue to cover the processing of data by the secretariat and the secretariat's staff will continue to be subject to the same confidentiality rules. Article 19 of Regulation 883/2013 provides that the Commission shall submit to the European Parliament and to the Council an evaluation report on the application of the Regulation by 2 October 2017, which shall also state whether the Regulation needs to be amended. Given the importance of a proper functioning of the Supervisory Committee and the need to avoid the impression that this functioning could be impaired by its institutional framework it seems important to adapt the Regulation on this point – and strictly on this point - as soon as possible and in any case before the overall evaluation of the Regulation takes place. Once the revised Regulation will enter into force, another technical amendment will have to be made to the OLAF Decision in order to bring it formally in line with the new legal framework.
Revised version (Article 10 Confidentiality and data protection):
1. Information transmitted or obtained in the course of external investigations, in whatever form, shall be protected by the relevant provisions. 2. Information transmitted or obtained in the course of internal investigations, in whatever form, shall be subject to professional secrecy and shall enjoy the protection afforded by the rules applicable to the Union institutions. 3. The institutions, bodies, offices or agencies concerned shall ensure that the confidentiality of the investigations conducted by the Office is respected, together with the legitimate rights of the persons concerned, and, where judicial proceedings have been initiated, that all national rules applicable to such proceedings have been adhered to. 4. The Office may designate a Data Protection Officer in accordance with Article 24 of Regulation (EC) No 45/2001. The Data Protection Officer shall be competent for the processing of data by the Office and by the secretariat of the Supervisory Committee. 5. The Director-General shall ensure that any information provided to the public is given neutrally and impartially, and that its disclosure respects the confidentiality of investigations and complies with the principles set out in this Article and in Article 9(1). In accordance with the Staff Regulations, the staff of the Office and the staff of the secretariat of the Supervisory Committee shall refrain from any unauthorised disclosure of information received in the exercise of their functions, unless that information has already been lawfully made public or is accessible to the public, and shall continue to be bound by that obligation after leaving the service. The members of the Supervisory Committee shall be bound by the same obligation of professional secrecy in the exercise of their functions, and shall continue to be bound by that obligation after the end of their mandate.
Article 11 Investigation report and action to be taken following investigations
1. On completion of an investigation by the Office, a report shall be drawn up, under the authority of the Director-General. That report shall give an account of the legal basis for the investigation, the procedural steps followed, the facts established and their preliminary classification in law, the estimated financial impact of the facts established, the respect of the procedural guarantees in accordance with Article 9 and the conclusions of the investigation. The report shall be accompanied by recommendations of the Director-General on whether or not action should be taken. Those recommendations shall, where appropriate, indicate any disciplinary, administrative, financial and/or judicial action by the institutions, bodies, offices and agencies and by the competent authorities of the Member States concerned, and shall specify in particular the estimated amounts to be recovered, as well as the preliminary classification in law of the facts established. 2. In drawing up such reports and recommendations, account shall be taken of the national law of the Member State concerned. Reports drawn up on that basis shall constitute admissible evidence in administrative or judicial proceedings of the Member State in which their use proves necessary, in the same way and under the same conditions as administrative reports drawn up by national administrative inspectors. They shall be subject to the same evaluation rules as those applicable to administrative reports drawn up by national administrative inspectors and shall have the same evidentiary value as such reports. 3. Reports and recommendations drawn up following an external investigation and any relevant related documents shall be sent to the competent authorities of the Member States concerned in accordance with the rules relating to external investigations and, if necessary, to the competent Commission services. 4. Reports and recommendations drawn up following an internal investigation and any relevant related documents shall be sent to the institution, body, office or agency concerned. That institution, body, office or agency shall take such action, in particular of a disciplinary or legal nature, as the results of the internal investigation warrant, and shall report thereon to the Office, within a time-limit laid down in the recommendations accompanying the report, and, in addition, at the request of the Office. 5. Where the report drawn up following an internal investigation reveals the existence of facts which could give rise to criminal proceedings, that information shall be transmitted to the judicial authorities of the Member State concerned. 6. At the request of the Office, the competent authorities of the Member States concerned shall, in due time, send to the Office information on action taken, if any, following the transmission by the Director-General of his recommendations in accordance with paragraph 3, and following the transmission by the Office of any information in accordance with paragraph 5. 7. Without prejudice to paragraph 4, if, on completion of an investigation, no evidence has been found against the person concerned, the Director-General shall close the investigation regarding that person and inform that person within 10 working days. 8. Where an informant who has provided the Office with information leading or relating to an investigation so requests, the Office may notify that informant that the investigation has been closed. The Office may, however, refuse any such request if it considers that it is such as to prejudice the legitimate interests of the person concerned, the effectiveness of the investigation and of the action to be taken subsequent thereto, or any confidentiality requirements.
Amendment rationale: CONTEXT OF THE PROPOSAL Reasons for and objectives of the proposal The Commission is pursuing an ambitious legislative agenda to strengthen the protection of the Union's financial interests. In July 2017, the Parliament and the Council adopted the Directive on the fight against fraud to the Union's financial interests by means of criminal law. In October 2017, the Council adopted the Regulation implementing enhanced cooperation on the establishment of the European Public Prosecutor's Office (EPPO). The establishment of the EPPO is a key Commission priority in the areas of criminal justice and the fight against fraud to the Union budget. The EPPO will change the EU institutional anti-fraud landscape significantly. It will have the power to conduct criminal investigations and prosecute before the courts of the participating Member States. It is expected to bring a more consistent and effective prosecution policy for crimes affecting the Union budget, leading to more prosecutions, convictions and a higher level of recovery. As a consequence of the adoption of the EPPO Regulation, Regulation No 883/2013 governing investigations by the European Anti-Fraud Office (OLAF) needs to be adapted. OLAF was set up in 1999 with the task, in particular, of conducting administrative investigations in the area of the protection of the Union's financial interests. Within its administrative mandate, OLAF investigates administrative irregularities as well as criminal behaviour. It plays a significant role in the fight against fraud, corruption and other illegal activities through its investigations aimed at enabling financial recoveries, disciplinary and administrative action, as well as indictments and prosecutions. OLAF has used its investigative expertise in a constantly developing context of fraud to the Union budget. It has handled increasing numbers of investigations, leading to increasing numbers of recommendations and amounts recommended for recovery. In the area of fraud, the creation of the EPPO will be a substantial improvement to the current situation. Today, OLAF carries out administrative investigations using administrative powers which are limited compared to criminal investigations. When it encounters possible criminal offences, it can only address a recommendation to national judicial authorities, but with no guarantees as to whether a criminal investigation will be opened. In future, in the Member States participating in the EPPO, it will report such suspected offences to the EPPO, and collaborate with it in the context of its investigations. Provisions to regulate the relationship between the EPPO and OLAF already exist in the EPPO Regulation. They are based on the principles of close cooperation, exchange of information, complementarity and non-duplication. These rules need to be mirrored and complemented in Regulation No 883/2013. The adaptation of the OLAF legal framework by the time the EPPO becomes operational is therefore the main driver for the amendment of Regulation No 883/2013. To ensure a smooth transition into the new framework, the amended Regulation should enter into force before the EPPO becomes operational (envisaged for the end of 2020). The EPPO and OLAF are both, within their respective remits, entrusted with the mandate to protect the Union's financial interests. While the EPPO will conduct criminal investigations aimed at investigating, prosecuting and bringing to judgment the perpetrators of, and accomplices to, offences affecting the financial interests of the Union, OLAF will continue conducting administrative investigations with a particular emphasis on facilitating administrative recovery and preventing further harm to the EU finances through administrative measures. Thus, the focus of activity of the future EPPO and of OLAF is distinct, although they converge towards a common goal. OLAF will also continue its investigations, in the same way as today, in the Member States not participating in the EPPO at this stage. In these Member States, the national authorities as well as OLAF should contribute to creating the conditions to ensure an effective and equivalent level of protection of the Union’s financial interests in the whole EU. In such circumstances, it is essential that the legal framework for OLAF is fit-for-purpose to allow it to fulfil its role with regard to the EPPO, the Member States and Union institutions, bodies, offices and agencies. The Commission evaluation of Regulation No 883/2013 concluded that the Regulation allowed OLAF to continue delivering concrete results in the protection of the Union budget. The 2013 changes brought clear improvements, as regards the conduct of investigations, cooperation with partners and the rights of persons concerned. At the same time, the evaluation highlighted shortcomings which impact on the effectiveness and efficiency of investigations. These findings relate to a wide range of areas including OLAF’s investigative tools, the enforcement of OLAF powers, uniform conditions in the conduct of internal investigations, the conduct of digital forensic operations, divergences in the follow-up to OLAF recommendations, the duties of cooperation by Member States and Union institutions, bodies, offices and agencies, or the overall coherence of the legal framework. However, addressing all evaluation findings is outside the scope of this proposal, as the revised Regulation should be in force by the time the EPPO becomes operational. The proposal therefore contains a limited number of targeted changes, based on the most unambiguous evaluation findings. These are essential changes necessary in the short term to strengthen the framework for OLAF investigations, in order to maintain a strong and fully-functioning OLAF that complements the EPPO's criminal law approach with administrative investigations, but which do not entail a change to its mandate or powers. The focus is on areas where, today, the lack of clarity of certain provisions in the current Regulation results in obstacles which hinder OLAF’s effective operations, regarding, notably, on-the-spot-checks and inspections or access to bank account information. The amendments proposed aim to clarify and reduce ambiguity in the current provisions for the economic operators concerned, for the Member States, and for OLAF, thus enhancing legal certainty. They would allow OLAF to operate in an effective and more coherent manner in all its investigations. This is directly related to the objectives of a strong protection of the budget across the Union coupled with appropriate procedural safeguards for economic operators subject to investigation. The overall objective of the proposal is to strengthen the protection of the Union's financial interests. This will be achieved by three specific objectives to: – adapt the operation of OLAF to the establishment of the EPPO; – enhance the effectiveness of OLAF’s investigative function; – clarify and simplify selected provisions of Regulation No 883/2013. The Commission evaluation report already indicated that the proposal containing these targeted changes could be followed by a more far-reaching process to modernise the OLAF framework, which in its core aspects dates from the creation of OLAF in 1999. This would be the opportunity to consider other more fundamental changes in the context of 21st century fraud areas and trends, and it should take account of the experience gained in the cooperation between the EPPO and OLAF. It would also allow considering other evaluation findings, as well as aspects of the legal framework where further reflection and discussion may be needed.
Revised version (Article 11 Investigation report and action to be taken following investigations):
1. On completion of an investigation by the Office, a report shall be drawn up, under the authority of the Director-General. That report shall give an account of the legal basis for the investigation, the procedural steps followed, the facts established and their preliminary classification in law, the estimated financial impact of the facts established, the respect of the procedural guarantees in accordance with Article 9 and the conclusions of the investigation. The report shall, where appropriate, be accompanied by recommendations of the Director-General on action to be taken. Those recommendations shall, where appropriate, indicate any disciplinary, administrative, financial or judicial action to be taken by the institutions, bodies, offices and agencies and by the competent authorities of the Member States concerned, and shall specify in particular the estimated amounts to be recovered, as well as the preliminary classification in law of the facts established. 2a. The Office shall take appropriate measures to ensure the consistent quality of reports and recommendations referred to in paragraph 1. 3. Reports and recommendations drawn up following an external investigation and any relevant related documents shall be sent to the competent authorities of the Member States concerned in accordance with the rules relating to external investigations and, if necessary, to the institution, body, office or agency concerned. The competent authorities of the Member State concerned and, if applicable, the institution, body, office or agency shall take such action as the results of the external investigation warrant and shall report thereon to the Office within a timelimit laid down in the recommendations accompanying the report and, in addition, at the request of the Office. Member States may notify to the Office the relevant national authorities competent to deal with such reports, recommendations and documents. 4. Reports and recommendations drawn up following an internal investigation and any relevant related documents shall be sent to the institution, body, office or agency concerned. That institution, body, office or agency shall take such action, in particular of a disciplinary or legal nature, as the results of the internal investigation warrant, and shall report thereon to the Office, within a time-limit laid down in the recommendations accompanying the report, and, in addition, at the request of the Office. 5. Where the report drawn up following an internal investigation reveals the existence of facts which could give rise to criminal proceedings, that information, together with the recommendations, shall be transmitted without delay to the judicial authorities of the Member State concerned, without prejudice to Articles 12c and 12d. At the request of the Office, the competent authorities of the Member States concerned shall, within a time limit laid down in the recommendations, send to the Office information on the action taken, if any, and the reasons for non-implementation of the recommendations, where applicable, following the transmission by the Office of any information in accordance with the first subparagraph of this paragraph. 7. Without prejudice to paragraph 4, if, on completion of an investigation, no evidence has been found against the person concerned, the Director-General shall close the investigation regarding that person and inform that person within 10 working days. 8. Where an informant provided the Office with information which led to the investigation, the Office shall notify that informant that the investigation has been closed, unless it considers that this information is such as to prejudice the legitimate interests of the person concerned and the effectiveness of the investigation and of the action to be taken subsequent thereto, or any confidentiality requirements.
Article 12 Exchange of information between the Office and the competent authorities of the Member States
1. Without prejudice to Articles 10 and 11 of this Regulation and to the provisions of Regulation (Euratom, EC) No 2185/96, the Office may transmit to the competent authorities of the Member States concerned information obtained in the course of external investigations in due time to enable them to take appropriate action in accordance with their national law. 2. Without prejudice to Articles 10 and 11, the Director-General shall transmit to the judicial authorities of the Member State concerned information obtained by the Office, in the course of internal investigations, concerning facts which fall within the jurisdiction of a national judicial authority. In accordance with Article 4 and without prejudice to Article 10, the Director-General shall also transmit to the institution, body, office or agency concerned the information referred to in the first subparagraph of this paragraph, including the identity of the person concerned, a summary of the facts established, their preliminary classification in law and the estimated impact on the financial interests of the Union. Article 9(4) shall apply. 3. The competent authorities of the Member State concerned shall, without prejudice to their national law, inform the Office in due time, on their own initiative or at the request of the Office, of the action taken on the basis of the information transmitted to them under this Article. 4. The Office may provide evidence in proceedings before national courts and tribunals in conformity with national law and the Staff Regulations.
Amendment rationale: CONTEXT OF THE PROPOSAL Reasons for and objectives of the proposal The Commission is pursuing an ambitious legislative agenda to strengthen the protection of the Union's financial interests. In July 2017, the Parliament and the Council adopted the Directive on the fight against fraud to the Union's financial interests by means of criminal law. In October 2017, the Council adopted the Regulation implementing enhanced cooperation on the establishment of the European Public Prosecutor's Office (EPPO). The establishment of the EPPO is a key Commission priority in the areas of criminal justice and the fight against fraud to the Union budget. The EPPO will change the EU institutional anti-fraud landscape significantly. It will have the power to conduct criminal investigations and prosecute before the courts of the participating Member States. It is expected to bring a more consistent and effective prosecution policy for crimes affecting the Union budget, leading to more prosecutions, convictions and a higher level of recovery. As a consequence of the adoption of the EPPO Regulation, Regulation No 883/2013 governing investigations by the European Anti-Fraud Office (OLAF) needs to be adapted. OLAF was set up in 1999 with the task, in particular, of conducting administrative investigations in the area of the protection of the Union's financial interests. Within its administrative mandate, OLAF investigates administrative irregularities as well as criminal behaviour. It plays a significant role in the fight against fraud, corruption and other illegal activities through its investigations aimed at enabling financial recoveries, disciplinary and administrative action, as well as indictments and prosecutions. OLAF has used its investigative expertise in a constantly developing context of fraud to the Union budget. It has handled increasing numbers of investigations, leading to increasing numbers of recommendations and amounts recommended for recovery. In the area of fraud, the creation of the EPPO will be a substantial improvement to the current situation. Today, OLAF carries out administrative investigations using administrative powers which are limited compared to criminal investigations. When it encounters possible criminal offences, it can only address a recommendation to national judicial authorities, but with no guarantees as to whether a criminal investigation will be opened. In future, in the Member States participating in the EPPO, it will report such suspected offences to the EPPO, and collaborate with it in the context of its investigations. Provisions to regulate the relationship between the EPPO and OLAF already exist in the EPPO Regulation. They are based on the principles of close cooperation, exchange of information, complementarity and non-duplication. These rules need to be mirrored and complemented in Regulation No 883/2013. The adaptation of the OLAF legal framework by the time the EPPO becomes operational is therefore the main driver for the amendment of Regulation No 883/2013. To ensure a smooth transition into the new framework, the amended Regulation should enter into force before the EPPO becomes operational (envisaged for the end of 2020). The EPPO and OLAF are both, within their respective remits, entrusted with the mandate to protect the Union's financial interests. While the EPPO will conduct criminal investigations aimed at investigating, prosecuting and bringing to judgment the perpetrators of, and accomplices to, offences affecting the financial interests of the Union, OLAF will continue conducting administrative investigations with a particular emphasis on facilitating administrative recovery and preventing further harm to the EU finances through administrative measures. Thus, the focus of activity of the future EPPO and of OLAF is distinct, although they converge towards a common goal. OLAF will also continue its investigations, in the same way as today, in the Member States not participating in the EPPO at this stage. In these Member States, the national authorities as well as OLAF should contribute to creating the conditions to ensure an effective and equivalent level of protection of the Union’s financial interests in the whole EU. In such circumstances, it is essential that the legal framework for OLAF is fit-for-purpose to allow it to fulfil its role with regard to the EPPO, the Member States and Union institutions, bodies, offices and agencies. The Commission evaluation of Regulation No 883/2013 concluded that the Regulation allowed OLAF to continue delivering concrete results in the protection of the Union budget. The 2013 changes brought clear improvements, as regards the conduct of investigations, cooperation with partners and the rights of persons concerned. At the same time, the evaluation highlighted shortcomings which impact on the effectiveness and efficiency of investigations. These findings relate to a wide range of areas including OLAF’s investigative tools, the enforcement of OLAF powers, uniform conditions in the conduct of internal investigations, the conduct of digital forensic operations, divergences in the follow-up to OLAF recommendations, the duties of cooperation by Member States and Union institutions, bodies, offices and agencies, or the overall coherence of the legal framework. However, addressing all evaluation findings is outside the scope of this proposal, as the revised Regulation should be in force by the time the EPPO becomes operational. The proposal therefore contains a limited number of targeted changes, based on the most unambiguous evaluation findings. These are essential changes necessary in the short term to strengthen the framework for OLAF investigations, in order to maintain a strong and fully-functioning OLAF that complements the EPPO's criminal law approach with administrative investigations, but which do not entail a change to its mandate or powers. The focus is on areas where, today, the lack of clarity of certain provisions in the current Regulation results in obstacles which hinder OLAF’s effective operations, regarding, notably, on-the-spot-checks and inspections or access to bank account information. The amendments proposed aim to clarify and reduce ambiguity in the current provisions for the economic operators concerned, for the Member States, and for OLAF, thus enhancing legal certainty. They would allow OLAF to operate in an effective and more coherent manner in all its investigations. This is directly related to the objectives of a strong protection of the budget across the Union coupled with appropriate procedural safeguards for economic operators subject to investigation. The overall objective of the proposal is to strengthen the protection of the Union's financial interests. This will be achieved by three specific objectives to: – adapt the operation of OLAF to the establishment of the EPPO; – enhance the effectiveness of OLAF’s investigative function; – clarify and simplify selected provisions of Regulation No 883/2013. The Commission evaluation report already indicated that the proposal containing these targeted changes could be followed by a more far-reaching process to modernise the OLAF framework, which in its core aspects dates from the creation of OLAF in 1999. This would be the opportunity to consider other more fundamental changes in the context of 21st century fraud areas and trends, and it should take account of the experience gained in the cooperation between the EPPO and OLAF. It would also allow considering other evaluation findings, as well as aspects of the legal framework where further reflection and discussion may be needed.
Revised version (Article 12 Exchange of information between the Office and the competent authorities of the Member States):
1. Without prejudice to Articles 10 and 11 of this Regulation and to the provisions of Regulation (Euratom, EC) No 2185/96, the Office may transmit to the competent authorities of the Member States concerned information obtained in the course of external investigations in due time to enable them to take appropriate action in accordance with their national law. It may also transmit such information to the institution, body, office or agency concerned. 2. Without prejudice to Articles 10 and 11, the Director-General shall transmit to the judicial authorities of the Member State concerned information obtained by the Office, in the course of internal investigations, concerning facts which fall within the jurisdiction of a national judicial authority. In accordance with Article 4 and without prejudice to Article 10, the Director-General shall also transmit to the institution, body, office or agency concerned the information referred to in the first subparagraph of this paragraph, including the identity of the person concerned, a summary of the facts established, their preliminary classification in law and the estimated impact on the financial interests of the Union. Article 9(4) shall apply. 3. The competent authorities of the Member State concerned shall, unless prevented by national law, inform the Office without delay, and in any event within 12 months of receipt of the information transmitted to them in accordance with this Article, of the action taken on the basis of that information. 4. The Office may provide evidence in proceedings before national courts and tribunals in conformity with national law and the Staff Regulations. 5. The Office may provide relevant information to the Eurofisc network established by Regulation (EU) No 904/2010. Eurofisc working field coordinators may transmit relevant information from the Eurofisc network to the Office under the conditions laid down in Regulation (EU) No 904/2010.
Article 13 Cooperation of the Office with Eurojust and Europol
1. Within its mandate to protect the financial interests of the Union, the Office shall cooperate, as appropriate, with Eurojust and with the European Police Office (Europol). Where necessary in order to facilitate that cooperation, the Office shall agree with Eurojust and Europol on administrative arrangements. Such working arrangements may concern exchange of operational, strategic or technical information, including personal data and classified information and, on request, progress reports. Where this may support and strengthen coordination and cooperation between national investigating and prosecuting authorities, or where the Office has forwarded to the competent authorities of the Member States information giving grounds for suspecting the existence of fraud, corruption or any other illegal activity affecting the financial interests of the Union in the form of serious crime, it shall transmit relevant information to Eurojust, within the mandate of Eurojust. 2. The competent authorities of the Member States concerned shall be informed, in a timely manner, by the Office in cases where information provided by them is transmitted by the Office to Eurojust or Europol.
Amendment rationale: CONTEXT OF THE PROPOSAL Reasons for and objectives of the proposal The Commission is pursuing an ambitious legislative agenda to strengthen the protection of the Union's financial interests. In July 2017, the Parliament and the Council adopted the Directive on the fight against fraud to the Union's financial interests by means of criminal law. In October 2017, the Council adopted the Regulation implementing enhanced cooperation on the establishment of the European Public Prosecutor's Office (EPPO). The establishment of the EPPO is a key Commission priority in the areas of criminal justice and the fight against fraud to the Union budget. The EPPO will change the EU institutional anti-fraud landscape significantly. It will have the power to conduct criminal investigations and prosecute before the courts of the participating Member States. It is expected to bring a more consistent and effective prosecution policy for crimes affecting the Union budget, leading to more prosecutions, convictions and a higher level of recovery. As a consequence of the adoption of the EPPO Regulation, Regulation No 883/2013 governing investigations by the European Anti-Fraud Office (OLAF) needs to be adapted. OLAF was set up in 1999 with the task, in particular, of conducting administrative investigations in the area of the protection of the Union's financial interests. Within its administrative mandate, OLAF investigates administrative irregularities as well as criminal behaviour. It plays a significant role in the fight against fraud, corruption and other illegal activities through its investigations aimed at enabling financial recoveries, disciplinary and administrative action, as well as indictments and prosecutions. OLAF has used its investigative expertise in a constantly developing context of fraud to the Union budget. It has handled increasing numbers of investigations, leading to increasing numbers of recommendations and amounts recommended for recovery. In the area of fraud, the creation of the EPPO will be a substantial improvement to the current situation. Today, OLAF carries out administrative investigations using administrative powers which are limited compared to criminal investigations. When it encounters possible criminal offences, it can only address a recommendation to national judicial authorities, but with no guarantees as to whether a criminal investigation will be opened. In future, in the Member States participating in the EPPO, it will report such suspected offences to the EPPO, and collaborate with it in the context of its investigations. Provisions to regulate the relationship between the EPPO and OLAF already exist in the EPPO Regulation. They are based on the principles of close cooperation, exchange of information, complementarity and non-duplication. These rules need to be mirrored and complemented in Regulation No 883/2013. The adaptation of the OLAF legal framework by the time the EPPO becomes operational is therefore the main driver for the amendment of Regulation No 883/2013. To ensure a smooth transition into the new framework, the amended Regulation should enter into force before the EPPO becomes operational (envisaged for the end of 2020). The EPPO and OLAF are both, within their respective remits, entrusted with the mandate to protect the Union's financial interests. While the EPPO will conduct criminal investigations aimed at investigating, prosecuting and bringing to judgment the perpetrators of, and accomplices to, offences affecting the financial interests of the Union, OLAF will continue conducting administrative investigations with a particular emphasis on facilitating administrative recovery and preventing further harm to the EU finances through administrative measures. Thus, the focus of activity of the future EPPO and of OLAF is distinct, although they converge towards a common goal. OLAF will also continue its investigations, in the same way as today, in the Member States not participating in the EPPO at this stage. In these Member States, the national authorities as well as OLAF should contribute to creating the conditions to ensure an effective and equivalent level of protection of the Union’s financial interests in the whole EU. In such circumstances, it is essential that the legal framework for OLAF is fit-for-purpose to allow it to fulfil its role with regard to the EPPO, the Member States and Union institutions, bodies, offices and agencies. The Commission evaluation of Regulation No 883/2013 concluded that the Regulation allowed OLAF to continue delivering concrete results in the protection of the Union budget. The 2013 changes brought clear improvements, as regards the conduct of investigations, cooperation with partners and the rights of persons concerned. At the same time, the evaluation highlighted shortcomings which impact on the effectiveness and efficiency of investigations. These findings relate to a wide range of areas including OLAF’s investigative tools, the enforcement of OLAF powers, uniform conditions in the conduct of internal investigations, the conduct of digital forensic operations, divergences in the follow-up to OLAF recommendations, the duties of cooperation by Member States and Union institutions, bodies, offices and agencies, or the overall coherence of the legal framework. However, addressing all evaluation findings is outside the scope of this proposal, as the revised Regulation should be in force by the time the EPPO becomes operational. The proposal therefore contains a limited number of targeted changes, based on the most unambiguous evaluation findings. These are essential changes necessary in the short term to strengthen the framework for OLAF investigations, in order to maintain a strong and fully-functioning OLAF that complements the EPPO's criminal law approach with administrative investigations, but which do not entail a change to its mandate or powers. The focus is on areas where, today, the lack of clarity of certain provisions in the current Regulation results in obstacles which hinder OLAF’s effective operations, regarding, notably, on-the-spot-checks and inspections or access to bank account information. The amendments proposed aim to clarify and reduce ambiguity in the current provisions for the economic operators concerned, for the Member States, and for OLAF, thus enhancing legal certainty. They would allow OLAF to operate in an effective and more coherent manner in all its investigations. This is directly related to the objectives of a strong protection of the budget across the Union coupled with appropriate procedural safeguards for economic operators subject to investigation. The overall objective of the proposal is to strengthen the protection of the Union's financial interests. This will be achieved by three specific objectives to: – adapt the operation of OLAF to the establishment of the EPPO; – enhance the effectiveness of OLAF’s investigative function; – clarify and simplify selected provisions of Regulation No 883/2013. The Commission evaluation report already indicated that the proposal containing these targeted changes could be followed by a more far-reaching process to modernise the OLAF framework, which in its core aspects dates from the creation of OLAF in 1999. This would be the opportunity to consider other more fundamental changes in the context of 21st century fraud areas and trends, and it should take account of the experience gained in the cooperation between the EPPO and OLAF. It would also allow considering other evaluation findings, as well as aspects of the legal framework where further reflection and discussion may be needed.
Revised version (Article 13 Cooperation of the Office with Eurojust and Europol):
1. Within its mandate to protect the financial interests of the Union, the Office shall cooperate, as appropriate, with the European Union Agency for Criminal Justice Cooperation (Eurojust) and with the European Union Agency for Law Enforcement Cooperation (Europol). Where necessary in order to facilitate that cooperation, the Office shall agree with Eurojust and Europol on administrative arrangements. Such working arrangements may concern exchange of operational, strategic or technical information, including personal data and classified information and, on request, progress reports. Where this may support and strengthen coordination and cooperation between national investigating and prosecuting authorities, or where the Office has forwarded to the competent authorities of the Member States information giving grounds for suspecting the existence of fraud, corruption or any other illegal activity affecting the financial interests of the Union in the form of serious crime, it shall transmit relevant information to Eurojust, within the mandate of Eurojust. 2. The competent authorities of the Member States concerned shall be informed, in a timely manner, by the Office in cases where information provided by them is transmitted by the Office to Eurojust or Europol.
Article 14 Cooperation with third countries and international organisations
1. Administrative arrangements may be agreed, as appropriate, by the Office with competent authorities in third countries and with international organisations. The Office shall coordinate its action, as appropriate, with the competent Commission services and with the European External Action Service, in particular before agreeing on such arrangements. Such arrangements may concern exchange of operational, strategic or technical information, including, on request, progress reports. 2. The Office shall inform the competent authorities of the Member States concerned before information provided by them is transmitted by the Office to competent authorities in third countries or to international organisations. The Office shall keep a record of all transmissions of personal data, including the grounds for such transmissions, in accordance with Regulation (EC) No 45/2001.
Article 15 Supervisory Committee
1. The Supervisory Committee shall regularly monitor the implementation by the Office of its investigative function, in order to reinforce the Office’s independence in the proper exercise of the competences conferred upon it by this Regulation. The Supervisory Committee shall in particular monitor developments concerning the application of procedural guarantees and the duration of investigations in the light of the information supplied by the Director-General in accordance with Article 7(8). The Supervisory Committee shall address to the Director-General opinions, including where appropriate, recommendations on, inter alia, the resources needed to carry out the investigative function of the Office, on the investigative priorities of the Office and on the duration of investigations. Those opinions may be delivered on its own initiative, at the request of the Director-General or at the request of an institution, body, office or agency, without however interfering with the conduct of investigations in progress. The institutions, bodies, offices or agencies shall be provided with a copy of opinions delivered pursuant to the third subparagraph. In duly justified situations, the Supervisory Committee may ask the Office for additional information on investigations, including reports and recommendations on closed investigations, without however interfering with the conduct of investigations in progress. 2. The Supervisory Committee shall be composed of five independent members having experience in senior judicial or investigative functions or comparable functions relating to the areas of activity of the Office. They shall be appointed by common accord of the European Parliament, the Council and the Commission. The decision appointing the members of the Supervisory Committee shall also include a reserve list of potential members to replace members of the Supervisory Committee for the remainder of their term of office in the event of the resignation, death or permanent incapacity of one or more of those members. 3. The term of office of members of the Supervisory Committee shall be five years and shall not be renewable. Three and two members shall be replaced alternately in order to preserve the Supervisory Committee’s expertise. 4. On expiry of their term of office, members of the Supervisory Committee shall remain in office until they are replaced. 5. If a member of the Supervisory Committee ceases to fulfil the conditions governing the performance of his duties, or if he has been found guilty of serious misconduct, the European Parliament, the Council and the Commission may, by common accord, relieve him of his duties. 6. In accordance with the applicable Commission rules, members of the Supervisory Committee shall receive a daily allowance and shall be reimbursed for expenses incurred by them in the course of their duties. 7. In carrying out their duties, the members of the Supervisory Committee shall neither seek nor take instructions from any government or any institution, body, office or agency. 8. The Supervisory Committee shall appoint its chair. It shall adopt its own rules of procedure, which shall, before adoption, be submitted to the European Parliament, the Council, the Commission and the European Data Protection Supervisor for information. Meetings of the Supervisory Committee shall be convened on the initiative of its chair or the Director-General. It shall hold at least 10 meetings per year. The Supervisory Committee shall take its decisions by a majority of its component members. Its secretariat shall be provided by the Office, in close consultation with the Supervisory Committee. 9. The Supervisory Committee shall adopt at least one report on its activities per year, covering in particular the assessment of the Office’s independence, the application of procedural guarantees and the duration of investigations. Those reports shall be sent to the European Parliament, the Council, the Commission and the Court of Auditors. The Supervisory Committee may submit reports to the European Parliament, the Council, the Commission and the Court of Auditors on the results of the Office’s investigations and the action taken on the basis of those results.
Amendment rationale: CONTEXT OF THE PROPOSAL Reasons for and objectives of the proposal The Supervisory Committee of the European Anti-Fraud Office was established by Regulation 1073/99 of 25 May 1999 concerning investigations conducted by the European Anti-Fraud Office (OLAF) 1 . Article 15(1) of the new OLAF Regulation 883/2013 of 11 September 2013 2 states that it tasks should be to "regularly monitor the implementation by the Office of its investigative function, in order to reinforce the Office's independence in the proper exercise of the competences conferred upon it by this Regulation" and, in particular, to "monitor developments concerning the application of procedural guarantees and the duration of investigations in the light of the information supplied by the Director General .. ". In its work, the Supervisory Committee is supported by a secretariat. Currently, this secretariat is provided by the OLAF, in accordance with Article 15(8) of the OLAF Regulation which states that the secretariat of the Supervisory Committee "shall be provided by the Office, in close consultation with the Supervisory Committee". Article 18 of the Regulation places the budgetary appropriations for the Supervisory Committee and its secretariat within the budget line of the Office and provides that the establishment plan of the Office includes that of the Supervisory Committee and of its secretariat. However, in the recent past some concerns have been voiced about possible conflicts of interest and calls have been made for a strengthened legal independence as regards the management of the Committee's budget and secretariat. Thus, in its Annual Activity Reports of 2013 and 2014 3 , the Supervisory Committee underlined the importance of its independent and effective functioning which requires an independent and adequately staffed secretariat. It stressed that the exercise of the Appointing Authority powers by OLAF's Director-General, including decisions on promotions and transfers, could potentially lead to conflicts of interest. It called for its budget and that of its secretariat to be specified in a separate line of the OLAF budget. The European Parliament called several times on the Commission to take measures to reinforce the independent functioning of OLAF's Supervisory Committee secretariat, such as in its report on the discharge procedure for 2013 4 or in its resolution on the OLAF Supervisory Committee's annual report 2014 5 . The issue has also been addressed in the Exchange of Views with the institutions established by Article 16 of the OLAF Regulation. During the exchange held on 28 September 2015, representatives from the European Parliament stressed again the need to strengthen the independent functioning of the Supervisory Committee's secretariat. On 18 December 2015, the Commission adopted an amendment to its Decision 1999/352 6 in order to move the responsibility for the implementation of the budgetary appropriations for the Members from the Director-General of OLAF to the Commission. The Commission subsequently delegated this responsibility to the Director of its Payments Office (PMO). This decision applied as from 1 January 2016. The objective of this decision was to avoid the appearance that the Members of the Supervisory Committee might not be in a position to ensure their mandate properly. This decision could, however, not achieve a full legal separation of the Committee's secretariat and budget from the Office. In order to separate the management of the Committee's secretariat from the management of the Office and to avoid any impression that OLAF can impair the functioning of the support to the Committee's Members, it is necessary to modify Regulation 883/2013 to foresee that the secretariat of the Supervisory Committee will be provided directly by the Commission. This modification will not affect the independence and operational functioning of the Supervisory Committee and of its Secretariat, who will continue to benefit from the same rights and be subject to the same obligations as before. In particular, OLAF's Data Protection Officer (DPO) will continue to cover the processing of data by the secretariat and the secretariat's staff will continue to be subject to the same confidentiality rules. Article 19 of Regulation 883/2013 provides that the Commission shall submit to the European Parliament and to the Council an evaluation report on the application of the Regulation by 2 October 2017, which shall also state whether the Regulation needs to be amended. Given the importance of a proper functioning of the Supervisory Committee and the need to avoid the impression that this functioning could be impaired by its institutional framework it seems important to adapt the Regulation on this point – and strictly on this point - as soon as possible and in any case before the overall evaluation of the Regulation takes place. Once the revised Regulation will enter into force, another technical amendment will have to be made to the OLAF Decision in order to bring it formally in line with the new legal framework.
Revised version (Article 15 Supervisory Committee):
1. The Supervisory Committee shall regularly monitor the implementation by the Office of its investigative function, in order to reinforce the Office’s independence in the proper exercise of the competences conferred upon it by this Regulation. The Supervisory Committee shall in particular monitor developments concerning the application of procedural guarantees and the duration of investigations in the light of the information supplied by the Director-General in accordance with Article 7(8). The Supervisory Committee shall address to the Director-General opinions, including where appropriate, recommendations on, inter alia, the resources needed to carry out the investigative function of the Office, on the investigative priorities of the Office and on the duration of investigations. Those opinions may be delivered on its own initiative, at the request of the Director-General or at the request of an institution, body, office or agency, without however interfering with the conduct of investigations in progress. The institutions, bodies, offices or agencies shall be provided with a copy of opinions delivered pursuant to the third subparagraph. In duly justified situations, the Supervisory Committee may ask the Office for additional information on investigations, including reports and recommendations on closed investigations, without however interfering with the conduct of investigations in progress. 2. The Supervisory Committee shall be composed of five independent members having experience in senior judicial or investigative functions or comparable functions relating to the areas of activity of the Office. They shall be appointed by common accord of the European Parliament, the Council and the Commission. The decision appointing the members of the Supervisory Committee shall also include a reserve list of potential members to replace members of the Supervisory Committee for the remainder of their term of office in the event of the resignation, death or permanent incapacity of one or more of those members. 3. The term of office of members of the Supervisory Committee shall be five years and shall not be renewable. Three and two members shall be replaced alternately in order to preserve the Supervisory Committee’s expertise. 4. On expiry of their term of office, members of the Supervisory Committee shall remain in office until they are replaced. 5. If a member of the Supervisory Committee ceases to fulfil the conditions governing the performance of his duties, or if he has been found guilty of serious misconduct, the European Parliament, the Council and the Commission may, by common accord, relieve him of his duties. 6. In accordance with the applicable Commission rules, members of the Supervisory Committee shall receive a daily allowance and shall be reimbursed for expenses incurred by them in the course of their duties. 7. In carrying out their duties, the members of the Supervisory Committee shall neither seek nor take instructions from any government or any institution, body, office or agency. 8. The Supervisory Committee shall appoint its chair. It shall adopt its own rules of procedure, which shall, before adoption, be submitted to the European Parliament, the Council, the Commission and the European Data Protection Supervisor for information. Meetings of the Supervisory Committee shall be convened on the initiative of its chair or the Director-General. It shall hold at least 10 meetings per year. The Supervisory Committee shall take its decisions by a majority of its component members. Its secretariat shall be provided by the Commission, independently from the Office, and in close cooperation with the Supervisory Committee. Before the appointment of any staff to the secretariat, the Supervisory Committee shall be consulted and its views shall be taken into account. The secretariat shall act on the instructions of the Supervisory Committee and independently from the Commission. Without prejudice to its control over the budget of the Supervisory Committee and its secretariat, the Commission shall not interfere with the monitoring functions of the Supervisory Committee. Officials assigned to the secretariat of the Supervisory Committee shall neither seek nor take instructions from any government or any institution, body, office or agency relating to the exercise of the monitoring functions of the Supervisory Committee. 9. The Supervisory Committee shall adopt at least one report on its activities per year, covering in particular the assessment of the Office’s independence, the application of procedural guarantees and the duration of investigations. Those reports shall be sent to the European Parliament, the Council, the Commission and the Court of Auditors. The Supervisory Committee may submit reports to the European Parliament, the Council, the Commission and the Court of Auditors on the results of the Office’s investigations and the action taken on the basis of those results.
Article 16 Exchange of views with the institutions
1. The European Parliament, the Council and the Commission shall once a year meet the Director-General for an exchange of views at political level to discuss the Office’s policy relating to methods of preventing and combating fraud, corruption or any other illegal activity affecting the financial interests of the Union. The Supervisory Committee shall participate in the exchange of views. Representatives of the Court of Auditors, Eurojust and/or Europol may be invited to attend on an ad hoc basis upon request of the European Parliament, the Council, the Commission, the Director-General or the Supervisory Committee. 2. The exchange of views may relate to: (a) the strategic priorities for the Office’s investigation policies; (b) the opinions and activity reports of the Supervisory Committee provided for under Article 15; (c) the reports of the Director-General under Article 17(4) and, as appropriate, any other reports by the institutions relating to the mandate of the Office; (d) the framework of the relations between the Office and the institutions, bodies, offices and agencies; (e) the framework of the relations between the Office and the competent authorities of the Member States; (f) the relations between the Office and the competent authorities in third countries as well as international organisations in the framework of the arrangements referred to in this Regulation; (g) the effectiveness of the work of the Office with regard to the performance of its mandate. 3. All institutions participating in the exchange of views shall ensure that the exchange of views does not interfere with the conduct of investigations in progress. 4. The institutions participating in the exchange of views shall take into account in their actions the opinions expressed in that exchange. The Director-General shall provide, in the reports referred to in Article 17(4), information on the actions, if any, taken by the Office.
Amendment rationale: CONTEXT OF THE PROPOSAL Reasons for and objectives of the proposal The Commission is pursuing an ambitious legislative agenda to strengthen the protection of the Union's financial interests. In July 2017, the Parliament and the Council adopted the Directive on the fight against fraud to the Union's financial interests by means of criminal law. In October 2017, the Council adopted the Regulation implementing enhanced cooperation on the establishment of the European Public Prosecutor's Office (EPPO). The establishment of the EPPO is a key Commission priority in the areas of criminal justice and the fight against fraud to the Union budget. The EPPO will change the EU institutional anti-fraud landscape significantly. It will have the power to conduct criminal investigations and prosecute before the courts of the participating Member States. It is expected to bring a more consistent and effective prosecution policy for crimes affecting the Union budget, leading to more prosecutions, convictions and a higher level of recovery. As a consequence of the adoption of the EPPO Regulation, Regulation No 883/2013 governing investigations by the European Anti-Fraud Office (OLAF) needs to be adapted. OLAF was set up in 1999 with the task, in particular, of conducting administrative investigations in the area of the protection of the Union's financial interests. Within its administrative mandate, OLAF investigates administrative irregularities as well as criminal behaviour. It plays a significant role in the fight against fraud, corruption and other illegal activities through its investigations aimed at enabling financial recoveries, disciplinary and administrative action, as well as indictments and prosecutions. OLAF has used its investigative expertise in a constantly developing context of fraud to the Union budget. It has handled increasing numbers of investigations, leading to increasing numbers of recommendations and amounts recommended for recovery. In the area of fraud, the creation of the EPPO will be a substantial improvement to the current situation. Today, OLAF carries out administrative investigations using administrative powers which are limited compared to criminal investigations. When it encounters possible criminal offences, it can only address a recommendation to national judicial authorities, but with no guarantees as to whether a criminal investigation will be opened. In future, in the Member States participating in the EPPO, it will report such suspected offences to the EPPO, and collaborate with it in the context of its investigations. Provisions to regulate the relationship between the EPPO and OLAF already exist in the EPPO Regulation. They are based on the principles of close cooperation, exchange of information, complementarity and non-duplication. These rules need to be mirrored and complemented in Regulation No 883/2013. The adaptation of the OLAF legal framework by the time the EPPO becomes operational is therefore the main driver for the amendment of Regulation No 883/2013. To ensure a smooth transition into the new framework, the amended Regulation should enter into force before the EPPO becomes operational (envisaged for the end of 2020). The EPPO and OLAF are both, within their respective remits, entrusted with the mandate to protect the Union's financial interests. While the EPPO will conduct criminal investigations aimed at investigating, prosecuting and bringing to judgment the perpetrators of, and accomplices to, offences affecting the financial interests of the Union, OLAF will continue conducting administrative investigations with a particular emphasis on facilitating administrative recovery and preventing further harm to the EU finances through administrative measures. Thus, the focus of activity of the future EPPO and of OLAF is distinct, although they converge towards a common goal. OLAF will also continue its investigations, in the same way as today, in the Member States not participating in the EPPO at this stage. In these Member States, the national authorities as well as OLAF should contribute to creating the conditions to ensure an effective and equivalent level of protection of the Union’s financial interests in the whole EU. In such circumstances, it is essential that the legal framework for OLAF is fit-for-purpose to allow it to fulfil its role with regard to the EPPO, the Member States and Union institutions, bodies, offices and agencies. The Commission evaluation of Regulation No 883/2013 concluded that the Regulation allowed OLAF to continue delivering concrete results in the protection of the Union budget. The 2013 changes brought clear improvements, as regards the conduct of investigations, cooperation with partners and the rights of persons concerned. At the same time, the evaluation highlighted shortcomings which impact on the effectiveness and efficiency of investigations. These findings relate to a wide range of areas including OLAF’s investigative tools, the enforcement of OLAF powers, uniform conditions in the conduct of internal investigations, the conduct of digital forensic operations, divergences in the follow-up to OLAF recommendations, the duties of cooperation by Member States and Union institutions, bodies, offices and agencies, or the overall coherence of the legal framework. However, addressing all evaluation findings is outside the scope of this proposal, as the revised Regulation should be in force by the time the EPPO becomes operational. The proposal therefore contains a limited number of targeted changes, based on the most unambiguous evaluation findings. These are essential changes necessary in the short term to strengthen the framework for OLAF investigations, in order to maintain a strong and fully-functioning OLAF that complements the EPPO's criminal law approach with administrative investigations, but which do not entail a change to its mandate or powers. The focus is on areas where, today, the lack of clarity of certain provisions in the current Regulation results in obstacles which hinder OLAF’s effective operations, regarding, notably, on-the-spot-checks and inspections or access to bank account information. The amendments proposed aim to clarify and reduce ambiguity in the current provisions for the economic operators concerned, for the Member States, and for OLAF, thus enhancing legal certainty. They would allow OLAF to operate in an effective and more coherent manner in all its investigations. This is directly related to the objectives of a strong protection of the budget across the Union coupled with appropriate procedural safeguards for economic operators subject to investigation. The overall objective of the proposal is to strengthen the protection of the Union's financial interests. This will be achieved by three specific objectives to: – adapt the operation of OLAF to the establishment of the EPPO; – enhance the effectiveness of OLAF’s investigative function; – clarify and simplify selected provisions of Regulation No 883/2013. The Commission evaluation report already indicated that the proposal containing these targeted changes could be followed by a more far-reaching process to modernise the OLAF framework, which in its core aspects dates from the creation of OLAF in 1999. This would be the opportunity to consider other more fundamental changes in the context of 21st century fraud areas and trends, and it should take account of the experience gained in the cooperation between the EPPO and OLAF. It would also allow considering other evaluation findings, as well as aspects of the legal framework where further reflection and discussion may be needed.
Revised version (Article 16 Exchange of views with the institutions):
1. The European Parliament, the Council and the Commission shall once a year meet the Director-General for an exchange of views at political level to discuss the Office’s policy relating to methods of preventing and combating fraud, corruption or any other illegal activity affecting the financial interests of the Union. The Supervisory Committee shall participate in the exchange of views. The European Chief Prosecutor shall be invited to attend the exchange of views. Representatives of the Court of Auditors, the EPPO, Eurojust and Europol may be invited to attend on an ad hoc basis upon request of the European Parliament, of the Council, of the Commission, of the Director-General or of the Supervisory Committee. 3. All institutions participating in the exchange of views shall ensure that the exchange of views does not interfere with the conduct of investigations in progress. 4. The institutions participating in the exchange of views shall take into account in their actions the opinions expressed in that exchange. The Director-General shall provide, in the reports referred to in Article 17(4), information on the actions, if any, taken by the Office.