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"AGRO IN 2001"

On 19 March 2020, the Third Chamber of the CJEU issued its Judgement in Case C-234/18. In this case, the Court had the opportunity to clarify the scope of the Council Framework Decision 2005/212/JHA of 24 February 2005 on Confiscation of Crime-Related Proceeds, Instrumentalities and Property (hereinafter the “FD 2005/212”), as amended by the Directive 2014/42/EU of the European Parliament and of the Council of 3 April 2014 on the freezing and confiscation of instrumentalities and proceeds of crime in the European Union (hereinafter the “Directive 2014/42”).

In the referred case, the Bulgarian Commission for combatting corruption has instituted proceedings to freeze assets said to have been obtained illegally by BP and others. The referring court observed that, in its national law, civil proceedings related to the confiscation of assets such as those in question are brought irrespective of whether the person under inquiry has been convicted by final judgment. The referring court is therefore unsure of the compatibility of that law with the minimum standards for asset confiscation laid down by Directive 2014/42, which provides that confiscation may be effected upon assets that have been obtained by way of a criminal offence for which the offender has been convicted by final judgment. In those circumstances, the referring court decided to stay the proceedings and refered six questions to the CJEU.

While the Bulgarian (and Czech) government claims to the inadmissibility of the case because the deadline to implement the Directive 2014/42 did not pass when the proceedings have been initiated before the referring court, the Court recalls that “where it is not obvious that the interpretation of an EU provision bears no relation to the facts of the main action or its purpose, the objection alleging the inapplicability of that provision to the case in the main action does not relate to the admissibility of the request for a preliminary ruling, but concerns the substance of the questions” (CJEU, Slovenské elektrárne, 12 December 2019 (Fifth Chamber), C‑376/18, pt. 29).

In that regard, Advocate General Sharpston stated that, although the Directive 2014/42 cannot be relied upon before the national courts in respect of proceedings initiated before the period prescribed for its implementation, the Directive 2014/42 amended the FD 2005/212 from the date on which the directive entered into force as provided for by Article 9(1) of Protocol No 36 on transitional provisions.

Moreover, the Court, recalling Advocate General’s Opinion, states that the Directive 2014/42 only partially amended the FD 2005/212. Therefore, the Court considers that the provisions of the latter are necessarily part of the elements of EU law which, having regard to the purpose of the main proceedings and the information provided by the national court, must be taken into account by the Court so that the latter may respond in a useful manner to the questions referred.

The Court then rephrases the question referred as whether the FD 2005/212 is to be interpreted as opposing a Member State’s law which provides that the confiscation of illegally acquired assets is ordered by a national court at the end of a procedure which is not subject either to the finding of a criminal offense or a fortiori to the conviction of the alleged offenders.

Having regard to the objectives and provisions of the FD 2005/212, especially its article 2, the Court asserts that the Framework Decision does not apply to the confiscation of instrumentalities and proceeds from illegal activities which are ordered by a court of a Member State in the course or as a result of a procedure which does not relate to the detection of criminal offences.

Moreover, the article 2(2) of the FD 2005/212, which provides that Member States may use procedures other than criminal proceedings to deprive the author of tax offenses of the proceeds of the offence, does not prevent Member States to establish confiscation procedure other than criminal proceedings in cases not relating to tax offenses. Such an interpretation would go beyond the scope of the minimal provisions laid down by the FD 2005/212.

Furthermore, although the confiscation proceeding such as the one pending before the referring court is initiated by the Commission for combatting corruption when the latter is informed that a person is accused of having committed criminal offences, this procedure is of a civil nature and coexists, in national law, with a criminal law confiscation regime.

Consequently, the Court concludes that the FD 2005/212 must be interpreted as not precluding a Member State’s law which provides that the confiscation of illegally acquired proceeds is issued by a national court at the end of a procedure which is not subject either to the finding of a criminal offence or, a fortiori, to the conviction of the alleged perpetrators of such an offence.

Case Number C-234/18

Name of the parties "AGRO IN 2001" - Komisia za protivodeystvie na koruptsiyata i za otnemane na nezakonno pridobitoto imushtestvo v BP et al.

Date of the judgement 2020-03-19

Court Court of Justice of the European Union (CJEU)

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