Written by Rafał Mańko,
Member States share an obligation with the EU to protect the Union’s financial interests and to counter fraud, corruption and any other illegal activities affecting them under Article 325 of the Treaty on the Functioning of the European Union (TFEU), on which the EU anti-fraud programme is based. According to a 2016 Eurobarometer survey, 75 % of EU citizens would like the EU to intervene more in the fight against tax fraud, making it one of the areas with the strongest support for greater EU involvement. At the same time, two thirds of EU citizens evaluate the current EU activity in the fight against fraud as insufficient. This Briefing focuses on two EU programmes within the remit of the fight against fraud: Pericles 2020 and Hercule III, as well as the anti-fraud information system (AFIS) platform (a further two crucial programmes in this area, Customs 2020 and Fiscalis 2020, are the subject of a separate briefing in this series).
Pericles 2020 is a multiannual programme to promote action on the protection and safeguarding of the euro against counterfeiting and related fraud. Pericles 2020’s added value is that it actively encourages an increase in transnational cooperation to protect the euro inside and outside the Union and with the Union’s trading partners. Pericles 2020 also has an international dimension, to address the situation in those Member States or third countries that have the highest rates of euro counterfeiting. The general objective of Pericles 2020, defined in Article 3 of Regulation 331/2014, is to prevent and combat counterfeiting and related fraud, thus enhancing the competitiveness of the Union’s economy and securing the sustainability of public finances. The specific objective of the programme is to protect euro banknotes and coins against counterfeiting and related fraud by supporting and supplementing the measures undertaken by the Member States and assisting the competent national and Union authorities in their efforts to develop close and regular cooperation and an exchange of best practice, where appropriate including third countries and international organisations. In 2018, the Pericles 2020 programme funded a number of actions, for a total of €993 388.74, including providing training and specialised anti-counterfeiting equipment.
The Hercule III programme aims at supporting the combat against irregularities, fraud and corruption that affect the EU budget. The general objective is to protect the financial interests of the Union, enhancing the competitiveness of the Union’s economy and ensuring the protection of taxpayers’ money. More specifically, the programme seeks to prevent and combat fraud, corruption and any other illegal activities affecting the financial interests of the Union. The latest available detailed information on spending under the Hercule III programme is for 2017. In that year, the programme financed, inter alia, grants concerning cigarettes and investigation support, and the procurement of IT databases and tools, tobacco analysis, technical equipment, and grants for anti-fraud, forensics and legal training.
The EU anti-fraud information system (AFIS) is simply a collection of applications that facilitate the exchange of anti-fraud information between OLAF and competent administrations in the framework of the Mutual Assistance Regulation (515/97). These applications include: AFIS Mailing (structured & unstructured communications); Customs Information System (CIS); FIDE System; Mutual Information System with the Russian Federation (MIS); virtual-OCU supporting Joint Surveillance Operations, and WCO-CigInfo system for the exchange of data relating to cigarette seizures between the Member States and the World Customs Organization (via OLAF). The AFIS platform also provides the irregularity management system (IMS) – a secure electronic tool for the reporting, management and analysis of irregularities, including fraud, that affect the financial interests of the EU. Competent national authorities use the IMS to report irregularities relating to EU funds in agriculture, structural and cohesion policy, fisheries, asylum-related funds, and the Fund for European Aid to the Most Deprived, as well as in pre-accession assistance.
On 30 May 2018, the European Commission published a proposal for a regulation establishing an EU anti-fraud programme under the new 2021-2027 multiannual financial framework (MFF). The proposal entails grouping the Hercule III programme with the anti-fraud information system (AFIS) and irregularity management system (IMS) operational activities (the latter is currently financed through AFIS). Under the proposed new programme, the operational provisions of AFIS and IMS would remain under their respective legal instruments, with only the financing provisions of AFIS transferred to the new EU anti-fraud programme regulation. This new financing arrangement for AFIS would cover all actions currently financed under AFIS, including IMS. IMS would become a stand-alone action to be financed under the new regulation, thereby uncoupling it from AFIS, as is currently the case.
Read the complete briefing on ‘How the EU budget is spent: Fight against fraud: Pericles 2020, Hercule III and AFIS‘ on the Think Tank pages of the European Parliament.