Directive (EU) 2017/1371 of the European Parliament and of the Council of 5 July 2017 on the fight against fraud to the Union's financial interests by means of criminal law
The proposal for a Directive on the fight against fraud to the Union’s financial interests by means of criminal law (the "PIF Directive") was submitted by the Commission in July 2012 and finally adopted in 2017.
The PIF Directive replaces the 1995 PIF Convention for the Member States which will be bound by the PIF Directive (i.e. all but Denmark and the UK). It has been adopted on the basis of Article 83(2) TFEU, although the Commission envisaged a different legal basis (Article 325 TFEU). The Commission has thus reserved its right to initiate legal proceedings about the legal basis before the Court of Justice.
The Directive harmonises the definition of fraud, misappropriation, and corruption, when they are committed to the detriment of the Union's financial interests. As for money laundering of property derived from PIF offences, the defintion of this offence is that of Directive (EU) 2015/849 (the fourth anti-money laundering Directive). The PIF Directive identifies the crimes for which the European Public Prosecutor's Office (EPPO) is competent.
The PIF Directive also harmonises the sanctions to be adopted by Member States for PIF offences. The Commission's Proposal even included a provision concerning minimum penalties, but this has been finally removed from the text.
Worth noting is the provision on the harmonisation of the statute of limitatiton, which is for the first time touched upon by an instrument of EU criminal law. In addition, the Directive lays down rules on the harmonisation of: incitement, aiding and abetting, and attempt to commit PIF offences; liability of legal persons and penalties thereof; aggravating circumstance if the PIF offence is committed within a criminal organisation in the sense of Framework Decision 2008/841/JHA; freezing and confiscation; jurisdiction and recovery.
Finally, the application of the Directive to VAT fraud was long debated. After the judgment of the Court of Justice in Taricco and others (C-105/14), which clarified that VAT fraud are already covered by the PIF Convention, the Council and the Parliament found a compromise: the PIF Directive applies to VAT fraud that is connected with the territory of two or more Member States and involves a total damage of at least EUR 10 million.
Reference number: Directive (EU) 2017/1371
Issue date: 05-07-17
Official Journal: OJ L198, 28 July 2017, pp. 29-41