Slow progress hinders fight against fraud

Date: 01/05/1997

EU GOVERNMENTS are proving infuriatingly slow in matching words with deeds when it comes to tackling fraud against the Union's budget, Justice Commissioner Anita Gradin will tell her colleagues next week.

In the past two years, member states have signed up to two key agreements to combat fraud, but neither has yet been ratified by any of the EU's 15 national parliaments.

The so-called 'fraud convention' was signed in July 1995 and, once ratified, will make it a criminal offence in all member states to commit fraud against the Union budget.

A first protocol to the convention, outlawing corruption by or against EU or national officials handling Union funds, was signed last September. But a second, penalising companies ('legal persons') benefiting from such fraud, has become bogged down because not all national legal systems recognise the concept of a legal person.

The two protocols could be ratified separately, but can only come into force with the ratification of the main convention.

While everyone agrees on the need to tackle a problem which costs taxpayers an estimated 8 billion ecu a year, ministerial negotiations are effectively log-jammed over the role of the European Court of Justice in interpreting the convention.

Some governments say the ECJ must be allowed compulsory jurisdiction over preliminary judgements - when national courts ask Luxembourg for its interpretation of Union law during national hearings - to prevent 15 different versions of the convention emerging.

Others, notably the UK, are opposed in principle to any increase in the ECJ's influence in domestic matters.

In addition to presenting her colleagues with what amounts to a 'lack of progress' report next week, Gradin will also unveil the Commission's annual analysis of the Union's fight against fraud.