Confiscation and freezing of assets
Throughout the EU, it has become increasingly important to deprive criminals of their assets and for the State to be able to freeze and confiscate property related to the committing of an offence. Due to the increasingly cross-border nature of criminal activity, particularly organised crime, closer cooperation between EU national judicial authorities is required for the legislation to remain effective.
Why should the EU act?
Traditional judicial cooperation in criminal matters is based on a variety of international legal instruments. These are mainly characterised by the 'request' principle whereby one sovereign State makes a request to another sovereign State, which then decides whether or not to comply with it. This system can be very slow and inefficient.
Modern criminal behaviour seeks to take advantage of these inefficiencies by both carrying out criminal activities across borders and by acquiring assets in a foreign country.
- EU citizens are able to move freely within Europe as well as buy property and reside abroad. The right to free movement of persons needs to be accompanied by measures making it possible to deliver justice in cases with a foreign dimension, for example whenever illegally acquired property is located abroad.
- Freezing and confiscation are effective tools used in the fight against crime as they aim to recover property derived from illegal sources. Freezing aims to temporarily retain property and confiscation is a further measure that stops anyone from accessing illegal property.
Thus, an efficient and effective system of seizure and confiscation of criminal assets helps to combat crime while continuing to safeguard the interests of European citizens.
What has been done so far?
- In 2003, the EU adopted the Framework Decision on the execution in the EU of orders freezing property or evidence;
- In 2006, the EU adopted the Framework Decision on the application of the principle of mutual recognition for confiscation orders.
The aim of these instruments is to apply freezing or confiscation within the territory of a different EU country where illegal goods have been placed or where a person is residing.
The Framework Decisions allow a judicial authority in one EU country to send an order to freeze or confiscate property directly to the judicial authority in another EU country where it will be recognised and executed without any further formality. This applies unless one of the grounds for non-recognition is invoked.
An Austrian businessman accused of belonging to an organised crime syndicate owns property in several EU countries.
- During the proceedings, the court decides to freeze his bank account as well as a villa and two cars. Knowing that the accused has property in other EU countries the court sends these a request to have his assets frozen.
- The authorities abroad follow the request. After the conviction has been passed in Austria a request for confiscation of the assets frozen so far is sent to the same authorities.
- The court receiving the freezing or confiscation request to be executed does not review the case, but recognises it without any further formality.
However, this procedure is not automatic and can be refused in some particular circumstances, for example when the same person has already been convicted of the same offence or when the person is covered by immunity or a certain privilege making prosecution impossible.
Implementation in national law
The deadline for transposition passed in 2005 for the Framework Decision on freezing and in 2008 for the Framework Decision on confiscation. The Commission's reports on the implementation of both instruments show that not all the EU countries are complying with the basic provisions.
This fact makes overall transposition patchy and less effective in practice than had been expected.