The adoption of Directive (EU) 2017/1371 of the European Parliament and of the Council (3) and Council Regulation (EU) 2017/1939 (4), substantially strengthened the means available to the Union to protect its financial interests by means of criminal law. The establishment of the European Public Prosecutor’s Office (EPPO) is a key priority in the Union’s criminal justice and anti-fraud policy, having the power to carry out criminal investigations and bring indictments related to criminal offences affecting the financial interests of the Union, within the meaning of Directive (EU) 2017/1371, in the participating Member States.
(2)
To protect the financial interests of the Union, the European Anti-Fraud Office (the ‘Office’) conducts administrative investigations into administrative irregularities as well as criminal conduct. At the end of its investigations, it may make judicial recommendations to the national prosecution authorities, in order to enable them to pursue indictments and prosecutions in Member States. In the Member States participating in the EPPO, it will report suspected criminal offences to the EPPO and collaborate with the EPPO in the context of the EPPO’s investigations.
(3)
Regulation (EU, Euratom) No 883/2013 of the European Parliament and of the Council (5) should be amended and adapted in light of the adoption of Regulation (EU) 2017/1939. The provisions of Regulation (EU) 2017/1939 governing the relationship between the Office and the EPPO should be reflected in, and complemented by, provisions in Regulation (EU, Euratom) No 883/2013, in order to ensure the highest level of protection of the financial interests of the Union through synergies between them, while ensuring close cooperation, information exchange, complementarity and the avoidance of duplication.
(4)
In view of their common goal of preserving the integrity of the Union budget, the Office and the EPPO should establish and maintain a close relationship based on the principle of sincere cooperation and aiming to ensure the complementarity of their respective mandates and the coordination of their action, in particular as regards the scope of the enhanced cooperation for the establishment of the EPPO. The relationship between the Office and the EPPO should contribute to ensuring that all means are used to protect the financial interests of the Union.
(5)
Regulation (EU) 2017/1939 requires the Office, as well as the institutions, bodies, offices and agencies of the Union and competent authorities of Member States, to report to the EPPO without undue delay suspected criminal conduct in respect of which the EPPO may exercise its competence. Since the mandate of the Office is to carry out administrative investigations into fraud, corruption and any other illegal activity affecting the financial interests of the Union, it is ideally placed and equipped to act as a partner and privileged source of information for the EPPO.
(6)
Elements pointing to possible criminal conduct falling within the competence of the EPPO may be present in initial allegations received by the Office or emerge only in the course of an administrative investigation opened by the Office on the grounds of a suspicion of administrative irregularity. In order to comply with its duty to report to the EPPO, the Office should therefore report suspected criminal conduct at any stage before or during its investigations.
(7)
Regulation (EU) 2017/1939 specifies the minimum elements that reports are to contain. The Office may need to conduct a preliminary evaluation of allegations to ascertain those elements and collect the necessary information. The Office should conduct such an evaluation expeditiously and by means which do not risk jeopardising a possible future criminal investigation. Upon completion of its evaluation, the Office should report to the EPPO where a suspicion of an offence within its competence is identified.
(8)
In consideration of the Office’s expertise, the institutions, bodies, offices and agencies established by, or on the basis of, the Treaties (‘institutions, bodies, offices and agencies’) should be able to make use of the Office to conduct such a preliminary evaluation of allegations reported to them.
(9)
In accordance with Regulation (EU) 2017/1939, the Office should in principle not open an administrative investigation in parallel with an investigation conducted by the EPPO into the same facts. However, in certain cases, the protection of the financial interests of the Union may require that the Office carry out a complementary administrative investigation before the conclusion of criminal proceedings initiated by the EPPO, with the purpose of ascertaining whether precautionary measures are necessary, or whether financial, disciplinary or administrative action should be taken. Such a complementary investigation may be appropriate, inter alia, to recover amounts due to the Union budget that are subject to specific time-barring rules, where the amounts at risk are very high, or where there is the need to avoid further expenditure in risk situations through administrative measures.
(10)
For the purpose of the application of the requirement of non-duplication of investigations, the notion of ‘same facts’ should be considered, in light of the case-law of the Court of Justice of the European Union (CJEU) on the ne bis in idem principle, to mean that the material facts under investigation are identical or substantially the same and understood in the sense of the existence of a set of concrete circumstances which are inextricably linked in time and space.
(11)
Regulation (EU) 2017/1939 provides that the EPPO may request the Office to carry out complementary administrative investigations. In the absence of such a request, such complementary investigations should be possible on the initiative of the Office under specific conditions after consulting the EPPO. In particular, the EPPO should be able to object to the opening or continuation of an investigation by the Office, or to the performance of certain acts pertaining to one of its investigations, in particular with a view to preserving the effectiveness of its investigation and powers. The Office should refrain from performing an action to which the EPPO has raised an objection. Where the Office opens an investigation in the absence of such an objection, it should conduct that investigation, consulting the EPPO on an ongoing basis.
(12)
The Office should actively support the EPPO’s investigations. In this regard, the EPPO should be able to request the Office to support or complement its criminal investigations through the exercise of powers under Regulation (EU, Euratom) No 883/2013. The Office should provide such support within the limits of its powers and within the framework provided for in that Regulation.
(13)
To ensure effective coordination, cooperation and transparency, the Office and the EPPO should exchange information on an ongoing basis. The exchange of information prior to the opening of investigations by the Office or the EPPO is particularly relevant to ensure proper coordination between their respective actions, to guarantee complementarity and to avoid duplication. To that end, the Office and the EPPO should make use of the hit/no-hit functions in their respective case management systems. The Office and the EPPO should specify the procedure and conditions for that exchange of information in their working arrangements. In order to ensure the proper application of the rules that seek to avoid duplication and ensure complementarity, the Office and the EPPO should agree on certain time limits for their information exchanges.
(14)
The Commission Report on Evaluation of the application of Regulation (EU, Euratom) No 883/2013 of 2 October 2017 (the ‘Commission evaluation report’) concluded that the 2013 changes to the legal framework brought clear improvements as regards the conduct of investigations, cooperation with partners and the rights of the persons concerned. At the same time, the Commission evaluation report highlighted some shortcomings which have an impact on the effectiveness and efficiency of investigations.
(15)
It is necessary to address the clearest findings of the Commission evaluation report by means of amendments to Regulation (EU, Euratom) No 883/2013. Those amendments are necessary in the short term to strengthen the framework for the Office’s investigations in order that the Office remains strong and fullyfunctioning and that it complements the EPPO’s criminal law approach with administrative investigations, without changing the Office’s mandate or powers. The amendments primarily concern areas where the lack of clarity of Regulation (EU, Euratom) No 883/2013 could hinder the effective conduct of investigations by the Office, such as the conduct of on-the-spot checks and inspections, the possibility of access to bank account information, or the admissibility of the case reports drawn up by the Office as evidence in administrative or judicial proceedings.
(16)
The amendments to Regulation (EU, Euratom) No 883/2013 do not affect the procedural guarantees applicable to the framework of investigations. The Office is bound by the procedural guarantees of Regulation (EU, Euratom) No 883/2013 and Council Regulation (Euratom, EC) No 2185/96 (6) and those contained in the Charter of Fundamental Rights of the European Union. That framework requires that the Office conduct its investigations objectively, impartially and confidentially, seeking evidence for and against the persons concerned, and carry out investigative acts on the basis of written authorisation and following a legality check. The Office is required to ensure respect for the rights of the persons concerned by its investigations, including the presumption of innocence and the right to avoid self-incrimination. When interviewed, the persons concerned have, inter alia, the right to be assisted by a person of their choice, to approve the record of the interview, and to use any of the official languages of the institutions of the Union. The persons concerned also have the right to comment on the facts of the case before conclusions are drawn.
(17)
Persons reporting fraud, corruption and any other illegal activity affecting the financial interests of the Union should be afforded the protection of Directive (EU) 2019/1937 of the European Parliament and of the Council (7).
(18)
Where the Office performs, within its mandate, supporting measures at the request of the EPPO, in order to protect the admissibility of evidence, as well as fundamental rights and procedural guarantees, while at the same time avoiding duplication of investigations and providing for an efficient and complementary cooperation, the Office and the EPPO, acting in close cooperation, should ensure that the applicable procedural safeguards of Chapter VI of Regulation (EU) 2017/1939 are observed.
(19)
The Office has power to conduct on-the-spot checks and inspections, which allow it to access the premises and documentation of economic operators in the framework of its investigations into suspected fraud, corruption or other illegal conduct affecting the financial interests of the Union. Such on-the-spot checks and inspections are carried out in accordance with Regulation (EU, Euratom) No 883/2013 and with Regulation (Euratom, EC) No 2185/96, which in some instances make the application of those powers subject to conditions of national law. The Commission evaluation report found that the extent to which national law applies is not completely clear, and as a result hinders the effectiveness of the Office’s investigative activities.
(20)
It is therefore appropriate to clarify the instances in which national law is to apply in the course of investigations by the Office, without changing the powers of the Office or the way in which Regulation (EU, Euratom) No 883/2013 operates in relation to the Member States, reflecting the judgment of the General Court of 3 May 2018 in Case T-48/16, Sigma Orionis SA v European Commission (8).
(21)
The conduct by the Office of on-the-spot checks and inspections in situations where the economic operator concerned submits to the on-the-spot check and inspection should be subject to Union law alone. This would allow the Office to exercise its investigative powers in an effective and coherent manner in all Member States with a view to contributing to a high level of protection of the financial interests of the Union throughout the Union in accordance with Article 325 of the Treaty on the Functioning of the European Union.
(22)
In situations where the Office needs to rely on the assistance of the competent authorities of Member States, particularly where an economic operator resists an on-the-spot check and inspection, Member States should ensure that the Office’s action is effective, and should provide the necessary assistance in accordance with the relevant rules of national procedural law. In order to safeguard the financial interests of the Union, the Commission should take any Member State’s failure to comply with its duty to cooperate with the Office into account in considering whether to recover the amounts concerned through the application of financial corrections on Member States, in accordance with the applicable Union law.
(23)
The Office is able, under Regulation (EU, Euratom) No 883/2013, to enter into administrative arrangements with competent authorities of Member States, such as anti-fraud coordination services, and institutions, bodies, offices and agencies, in order to specify the arrangements for their cooperation under that Regulation, in particular concerning the transmission of information, the conduct of investigations and any follow-up action.
(24)
Regulation (EU, Euratom) No 883/2013 should be amended to introduce a duty on the part of economic operators to cooperate with the Office, in accordance with their obligation under Regulation (Euratom, EC) No 2185/96 to grant access for the carrying out of on-the-spot checks and inspections of premises, land, means of transport or other areas, used for business purposes, and with the obligation set out in Article 129 of Regulation (EU, Euratom) 2018/1046 of the European Parliament and of the Council (9) that any person or entity receiving Union funds is to fully cooperate in the protection of the financial interests of the Union, including in the context of investigations by the Office.
(25)
As part of that duty of cooperation, the Office should be able to require economic operators to supply relevant information where they may have been involved in the matter under investigation or may hold such information. When complying with such requests, economic operators should not be obliged to make self-incriminating statements, but they should be obliged to answer factual questions and provide documents, even if that information may be used to establish against them or against another economic operator the existence of illegal activity. To ensure the effectiveness of investigations in the context of current work practices, the Office should be able to request access to information in privately owned devices used for work purposes. Access by the Office should be given subject to the same conditions and to the same extent that apply to national control authorities, and only if the Office has reasonable grounds to suspect that the content of such devices may be relevant for the investigation, in accordance with the principles of necessity and proportionality, and should only concern information relevant to the investigation.
(26)
Economic operators should have the possibility to use any of the official languages of the Member State where the check takes place, and should have the right to be assisted by a person of their choice, including external legal counsel, during on-the-spot checks and inspections. The presence of legal counsel should not, however, represent a legal condition for the validity of on-the-spot checks and inspections. To ensure the effectiveness of on-the-spot checks and inspections, in particular as regards the risk of evidence disappearing, the Office should be able to access to the premises, land, means of transportation or other areas used for business purposes without waiting for the economic operator to consult legal counsel. It should accept only a short, reasonable delay pending consultation of legal counsel before starting the on-the-spot check and inspection. Any such delay should be kept to the strict minimum.
(27)
To ensure transparency when carrying out on-the-spot checks and inspections, the Office should provide economic operators with appropriate information on their duty to cooperate and the consequences of a refusal to do so, and the procedure applicable, including the procedural safeguards.
(28)
In internal and, where necessary, external investigations, the Office has access to any relevant information held by the institutions, bodies, offices and agencies. It is necessary, as suggested in the Commission evaluation report, to clarify that such access should be possible irrespective of the type of medium on which that information or data are stored, in order to reflect evolving technological progress. In the course of internal investigations, the Office should be able to request access to information held on privately owned devices used for work purposes in situations where the Office has reasonable grounds to suspect that their content might be relevant for the investigation. It should be possible to subject access by the Office to specific conditions by the relevant institution, body, office or agency. Such access should comply with the principles of necessity and proportionality and should concern only information relevant to the investigation. To guarantee an effective and consistent level of access for the Office, as well as a high level of protection of the fundamental rights of the persons concerned, the institutions, bodies, offices and agencies should ensure the coherence of the rules on access to private devices adopted by the different institutions, bodies, offices and agencies in order to provide equivalent conditions in compliance with the Interinstitutional Agreement of 25 May 1999 between the European Parliament, the Council of the European Union and the Commission of the European Communities concerning internal investigations by the European Anti-fraud Office (OLAF) (10).
(29)
For a more coherent framework for the investigations of the Office, the rules applicable to internal and external investigations should be further aligned in order to address certain inconsistencies identified in the Commission evaluation report where divergent rules are not justified. For instance, reports and recommendations drawn up following an external investigation should, if necessary, be sent to the institution, body, office or agency concerned for it to take appropriate action, as is the case in internal investigations. Where possible in accordance with its mandate, the Office should support the institution, body, office or agency concerned in following up its recommendations. Where the Office does not open an investigation, it should be able to send relevant information to Member States’ authorities or to the institutions, bodies, offices or agencies for appropriate action to be taken. It should send such information where it decides not to open an investigation despite there being a sufficient suspicion of fraud, corruption or any other illegal activity affecting the financial interests of the Union. Before doing so, the Office should give due consideration to a possible interference with ongoing investigations by the EPPO.
(30)
Due to the large diversity of national institutional frameworks, Member States should, on the basis of the principle of sincere cooperation, have the possibility to notify to the Office the authorities that are competent to take actions upon recommendations of the Office, as well as the authorities that need to be informed, such as for financial, statistical or monitoring purposes, for the performance of their relevant duties. Such authorities may include national anti-fraud coordination services. In accordance with the settled case-law of the CJEU, the Office recommendations included in its reports have no binding legal effects on such authorities of Member States or on institutions, bodies, offices and agencies.
(31)
The Office should be provided with the necessary means to follow the money trail in order to uncover the modus operandi typical of much fraudulent conduct. The Office is able to obtain bank account information relevant for its investigative activity held by credit institutions in a number of Member States through cooperation with and assistance by the national authorities. To ensure an effective approach throughout the Union, Regulation (EU, Euratom) No 883/2013 should specify the duty of competent national authorities to provide bank account information to the Office, as part of their general duty to assist the Office. Member States should notify to the Commission the competent authorities through which such cooperation is to take place. When giving such assistance to the Office, the national authorities should act under the same conditions that apply to the competent national authorities of the Member State concerned.
(32)
For the purpose of protecting and complying with procedural guarantees and fundamental rights, the Commission should create an internal function in the form of a Controller of procedural guarantees (the ‘Controller’), which should – with a view to an efficient use of resources – be administratively attached to the Supervisory Committee, and be provided with adequate resources. The Controller should handle complaints in a fully independent manner, including from the Supervisory Committee and from the Office, and should have access to all information necessary to fulfil his or her duties.
(33)
A person concerned should be able to lodge a complaint with the Controller regarding the Office’s compliance with procedural guarantees as well as on the grounds of an infringement of the rules applicable to investigations by the Office, in particular infringements of procedural requirements and fundamental rights.A complaints mechanism should be established to that end. The Controller should be responsible for issuing recommendations in response to such complaints, where necessary suggesting solutions to the issues raised in the complaint. The Controller should examine the complaint in a swift, adversarial procedure, while allowing the Office to continue the ongoing investigation. The Controller should give the complainant and the Office the opportunity to provide comments on or resolve the issues raised in the complaint. The Director-General should take appropriate action as warranted by the Controller’s recommendation. The Director-General should, in duly justified cases, be able to deviate from the Controller’s recommendations. Thereasons for doing so should be attached to the final investigation report.
(34)
In order to increase transparency and accountability, the Controller should report on the complaints mechanism in his or her annual report. The annual report should cover in particular the number of complaints received, the types of infringements of procedural requirements and fundamental rights involved, the activities concerned and, where possible, the follow-up measures taken by the Office.
(35)
The early transmission of information by the Office for the purpose of adopting precautionary measures is an essential tool for the protection of the financial interests of the Union. In order to ensure close cooperation in this regard between the Office and the institutions, offices, bodies and agencies, it is appropriate that the latter have the possibility to consult at any time the Office with a view to deciding on any appropriate precautionary measures, including measures for the safeguarding of evidence.
(36)
Reports drawn up by the Office constitute admissible evidence in administrative or judicial proceedings in the same way and under the same conditions as administrative reports drawn up by national administrative inspectors. According to the Commission evaluation report this rule does not sufficiently ensure the effectiveness of the Office’s activities in some Member States. To increase the effectiveness and the consistent use of reports of the Office, Regulation (EU, Euratom) No 883/2013 should provide for the admissibility of such reports in judicial proceedings of a non-criminal nature before national courts, as well as in administrative proceedings in Member States. The rule providing for equivalence with the reports of national administrative inspectors should continue to apply in the case of national judicial proceedings of a criminal nature. Regulation (EU, Euratom) No 883/2013 should also provide for the admissibility of the reports drawn up by the Office in administrative and judicial proceedings at Union level.
(37)
The anti-fraud coordination services of Member States were introduced by Regulation (EU, Euratom) No 883/2013 to facilitate an effective cooperation and exchange of information, including information of an operational nature, between the Office and Member States. The Commission evaluation report concluded that they have contributed positively to the work of the Office. The Commission evaluation report also identified the need to further clarify the role of those anti-fraud coordination services in order to ensure that the Office is provided with the necessary assistance to ensure that its investigations are effective, while leaving the organisation and powers of the anti-fraud coordination services to each Member State. In that regard, the anti-fraud coordination services should be able to provide or coordinate the necessary assistance to the Office to carry out its tasks effectively, before, during or at the end of an external or internal investigation.
(38)
The duty of the Office to provide Member States with assistance in order to coordinate their action for the protection of the financial interests of the Union is a key element of its mandate to support cross-border cooperation among Member States. More detailed rules should be laid down in order to facilitate the coordinating activities of the Office and its cooperation in this context with Member States’ authorities, third countries and international organisations. Those rules should be without prejudice to the exercise by the Office of powers conferred on the Commission in specific provisions governing mutual assistance between Member States’ administrative authorities and cooperation between those authorities and the Commission, in particular to Council Regulation (EC) No 515/97 (11) and Regulation (EU) No 608/2013 of the European Parliament and of the Council (12), as well as coordination activities relating to the European Structural and Investment Funds.
(39)
It should be clarified that when the competent authorities of Member States, including anti-fraud-coordination services, act in cooperation with the Office or with other competent authorities for the purposes of protecting the financial interests of the Union, they continue to be bound by national law.
(40)
It should be possible for the anti-fraud coordination services in the context of coordination activities to provide assistance to the Office, as well as for the anti-fraud coordination services to cooperate among themselves, in order to further reinforce the available mechanisms for cooperation in the fight against fraud.
(41)
The competent authorities of Member States, as well as the institutions, bodies, offices and agencies, should take the actions warranted by a recommendation of the Office. In order to allow the Office to followup on the development of its cases, where the Office makes judicial recommendations to the national prosecution authorities of a Member State, Member States should, upon request of the Office, send the Office the final decision of the national court. In order to fully maintain judicial independence, such transmission should take place only after the relevant judicial proceedings have been finally determined and the final court decision has become public.
(42)
In order to supplement the procedural rules on the conduct of investigations set out in Regulation (EU, Euratom) No 883/2013, the Office should lay down guidelines on investigation procedures to be followed by the staff of the Office.
(43)
It should be clarified that the Office may participate in joint investigation teams established in accordance with Union law and that it is entitled to exchange operational information acquired in that framework. The use of such information is subject to the conditions and safeguards provided for in the Union law on the basis of which the joint investigation teams have been established. When the Office participates in such joint investigation teams, it has a supporting capacity and takes the role of a partner subject to legal constraints that may exist in Union or national law.
(44)
No later than five years after the date determined in accordance with the second subparagraph of Article 120(2) of Regulation (EU) 2017/1939, the Commission should evaluate the application of Regulation (EU, Euratom) No 883/2013 and in particular the efficiency of the cooperation between the Office and the EPPO in order to consider whether amendments are warranted on the basis of experience regarding that cooperation. The Commission should submit, where appropriate, a new comprehensive legislative proposal, no later than two years after that evaluation.
(45)
Since the objective of this Regulation, namely to strengthen the protection of the financial interests of the Union by adapting the operation of the Office to the establishment of the EPPO and by enhancing the effectiveness of the investigations by the Office, cannot be sufficiently achieved by the Member States, but can rather, by adopting rules governing the relationship between the Office and the EPPO to increase the effectiveness of the conduct of investigations by them, be better achieved at Union level, the Union may adopt measures, in accordance with the principle of subsidiarity as set out in Article 5 of the Treaty on European Union. In accordance with the principle of proportionality, as set out in that Article, this Regulation does not go beyond what is necessary in order to achieve that objective.
(46)
This Regulation does not modify the powers and responsibilities of Member States to take measures to combat fraud, corruption and any other illegal activity affecting the financial interests of the Union.
(47)
The European Data Protection Supervisor was consulted in accordance with Article 28(2) of Regulation (EC) No 45/2001 of the European Parliament and of the Council (13) and delivered formal comments on 23 July 2018.
(48)
Regulation (EU, Euratom) No 883/2013 should therefore be amended accordingly,
