Select Committee on European Scrutiny Twentieth Report


PENAL SANCTIONS AGAINST COUNTERFEITING IN CONNECTION WITH THE INTRODUCTION OF THE EURO


(a)
(23110)
15441/01
SEC (01)1999



(b)
(23111)
15442/01
COM(01) 771


Commission staff working paper — Annex to the Commission report based on
Article 11 of the Council's Framework Decision of 29 May 2000 on increasing
protection by criminal penalties and other sanctions against counterfeiting in
connection with the introduction of the euro.


Commission report based on Article 11 of the Council's Framework Decision
of 29 May 2000 on increasing protection by criminal penalties and other
sanctions against counterfeiting in connection with the introduction of the
euro.


Legal base:
Documents originated:13 December 2001
Forwarded to the Council: 14 December 2001
Deposited in Parliament: 24 January 2002
Department:Home Office
Basis of consideration: EM of 6 February 2002
Previous Committee Report: None; but see (20925) 14102/99: HC 23-x (1999-2000), paragraph 5 (1 March 2000)
To be discussed in Council: Not applicable
Committee's assessment:Politically important
Committee's decision:(Both) Cleared, but further information requested


Background

  20.1  In March 2000 the previous Committee cleared the Framework Decision concerning counterfeiting of the euro, which was agreed on 29 May 2000. Article 11 of the Decision required the Member States to take the necessary steps to comply with its provisions by 29 May 2001, with the exception of Article 5 (a) — concerned with offences committed before 1 January 2002 and related to future banknotes and coins — which should have been complied with by 31 December 2000. The same Article required the Commission to report to the Council, by 30 June 2001, on the extent of Member States' implementation.

The report

  20.2  The Commission's report is contained in document (a), and is supplemented by an annex (document (b)), with tables summarising each Member State's performance in relation to each Article. In its Introduction, the Commission underlines the fact that this is the first occasion on which the implementation of a framework decision has been evaluated. The report identifies some similarities between directives and framework decisions, but points out that the Commission has no power to bring an action before the European Court of Justice (ECJ) in respect of the transposition of a framework decision.

  20.3  The Commission states that the report is factual, concentrating on the key provisions of the framework decision, and providing information to enable the Council and other institutions, such as the European Parliament and the European Central Bank, to assess the extent of compliance, and hence of protection of the euro. It also aims to provide a factual basis which would allow a Member State to refer an allegedly incorrect interpretation or application of the measure by another Member State to the ECJ[52].

  20.4  From both the report and the annex, it appears that Member States have been very slow in notifying the Commission about the measures taken to implement the framework Decision. By 29 May 2001, only two Member States had provided the required notification, and, as a consequence, the Commission decided to delay the report.

  20.5  Implementation itself has also been slow. The document reports that only six Member States (including the UK, in part) met the deadline for Article 5 (a).

  20.6  With regard to the UK, the report states that it has not taken the necessary measures to comply with Articles 8 (2) and 9 (2). These provisions require Member States to establish criminal liability of legal persons for lack of supervision or control of a person with a leading position in the legal person, which makes possible the commission of an offence for the benefit of the legal person. Legal persons who are held liable in this way must be punishable by effective, proportionate and dissuasive measures or sanctions.

The Government's view

  20.7  The Parliamentary Under-Secretary of State at the Home Office (Mr Bob Ainsworth) tells us that his Department is considering the Commission's view. If necessary, the Government will rectify the situation as soon as possible, by putting forward amendments to the Forgery and Counterfeiting Act 1981. He also tells us that the relevant implementing legislation for Gibraltar is in an advanced state of preparation.

Conclusion

  20.8  Given the amount of time the previous Committee spent on the draft framework decision, and the general nervousness about the counterfeiting of the euro, the Commission's findings strike us as depressing. Although the report is not easy to follow, the impression is that most Member States have not exerted themselves to implement this measure.

  20.9  The UK can be exempted from this criticism, both because of its timely compliance with Article 5 (a), and because of its willingness to make changes if necessary in order to comply with Articles 8 (2) and 9 (2). We are somewhat disappointed, however, that the Minister has concentrated on the comments about the UK in the report, and has not commented at all on the wider picture.

  20.10  We clear the documents, but ask the Minister whether he shares our view that the report reveals an unsatisfactory situation. As it is the first occasion on which the implementation of a framework decision has been evaluated, we also ask for his views on the report itself, and whether it provides a useful model to be followed in other cases.


52  In accordance with Article 35(7) EU. Back


 
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