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Make seizing criminal assets across the EU faster and more efficient
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Unexplained wealth linked to criminal organisations can be confiscated
The new legislation on seizing criminal assets would ensure fast and efficient freezing and confiscation everywhere in the EU and improve the rights of victims in these processes.
On Tuesday, negotiators from the European Parliament and the Council of the EU reached a provisional agreement on new legislation to boost the freezing and confiscation of criminal assets.
Compared to existing legislation, the new directive would cover a wider range of crimes committed within the framework of a criminal organisation, such as trafficking in human beings, drugs or firearms. It would close loopholes by ensuring assets can be frozen quickly, with temporary urgent freezing measures where necessary.
The law would also crack down on cases where confiscation is evaded with the help of a third person, and allow confiscation in certain cases where conviction is not possible, for example in cases of illness or death of a suspect. To prevent assets from degrading, member states would have to set up dedicated offices to manage confiscated assets, and tools to manage information related to them, for example central registries.
Plugging information gaps to track criminal assets
To make cross-border investigations more efficient, the law would strengthen the powers of asset recovery offices (AROs) set up by member states, ensuring that they get swift access to necessary information including real estate, citizenship, and commercial registries, including fiscal and securities data. During negotiations, MEPs managed to also include beneficial ownership registries and centralised bank account registries in the scope of ARO direct access.
New forms of confiscation
In addition to forms of confiscation already existing in EU law, the new directive will also cover two novel types of confiscation: non-conviction based confiscation, and confiscation of unexplained wealth that have already proven their effectiveness in some Member States.
Securing the rights of victims
The agreement also includes extensive provisions to ensure that the rights of victims are fully taken into account within the asset tracing, freezing and confiscation proceedings, prioritizing restitution to victims and ensuring their compensation.
Better tracing to support the effective implementation of EU sanctions
According to the final agreement, AROs can make the application of EU restrictive measures (sanctions) more effective by enabling AROs to assist national competent authorities in the tracing and identification of property of persons and entities subject to union restrictive measures. Assets confiscated based on those proceedings can now also be used to contribute to mechanisms to support third countries affected by situations in response to which the Union restrictive measures were adopted, in particular in cases of war of aggression.
In parallel, MEPs are also negotiating new rules to criminalise the violations of EU sanctions in harmonised way.
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After the vote, rapporteur Loránt Vincze (EPP, Romania) said: “An effective confiscation framework of assets deriving from criminal activity serves as a proactive and impactful strategy in the fight against organized crime, targeting its core motivation—financial gain. With today’s agreement on the Directive on Asset Recovery and Confiscation, we managed to take a great step in this regard: the agreement strengthens the capabilities of competent authorities to identify, freeze, confiscate and manage assets through improved access to relevant databases, better and faster information-sharing among competent authorities, and the introduction of novel, more effective procedures to confiscate criminal assets. “
Background
In 2010–2014, only 2.2% of the proceeds of crime were frozen in the EU, and only 1.1% of these proceeds were confiscated. In December 2021, the European Parliament called for the EU’s regime on asset recovery and confiscation to be harmonised, and in the EU Strategy to tackle Organised Crime (2021-2025), the Commission proposed strengthening these rules.