EC Proposes Rules to Modernize Asset Seizures, Target Sanctions Evaders
The European Commission this week announced two new proposals to harmonize how member states penalize sanctions violations and to modernize the EU’s recovery rules for sanctioned assets. The measures will help the EU better target and punish sanctions evaders, said Vera Jourova, the commission’s vice president for values and transparency. “The violation of EU sanctions is a serious crime and must come with serious consequences,” Jourova said. “We need EU-wide rules to establish that.”
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One proposal will add any violation of the EU’s restrictive measures -- including trade restrictions and financial sanctions -- to the list of EU crimes. This will allow the bloc to “set a common basic standard on criminal offenses and penalties across the EU,” the commission said, which will make it “easier” for the EU to “investigate, prosecute and punish” sanctions violators.
“At present, divergent criminal definitions and sanctions as regards the violation of the restrictive measures can still lead to impunity,” European Commissioner for Justice and Consumers Didier Reynders said. “We need to close the loopholes and provide judicial authorities with the right tools to prosecute violations of Union restrictive measures.”
Another proposal would revise the EU’s asset recovery rules to allow the bloc’s Asset Recovery Offices to “swiftly trace and identify assets of individuals and entities subject to EU restrictive measures.” It would also allow member states to confiscate assets based on a “wider set of crimes” and establish asset management offices in all EU member states. This would ensure that frozen property “does not lose value, enabling the sale of frozen assets that could easily depreciate or are costly to maintain,” the commission said.
The proposals were prompted by gaps in the EU’s sanctions against Russia and Belarus, the commission said, especially against oligarchs, who hide their wealth “across different jurisdictions through complex legal and financial structures.” The commission said “an inconsistent enforcement of restrictive measures undermines the Union's ability to speak with one voice.”
The commission also said some member states use different definitions to assess how they can penalize certain EU sanctions. “In some Member States, violation of restrictive measures is an administrative and a criminal offense, in some purely a criminal offense, and in some, restrictive measures violations currently only lead to administrative penalties,” the commission said. “This patchwork enables persons subject to restrictive measures to circumvent them.”
The commission hopes the proposed changes to asset recovery practices lead to “clear rules on asset tracing and identification to boost cross-border cooperation,” it said in a question-and-answer document. It could also give member states “new powers to freeze assets and make sure that they do not disappear before the criminal proceeding is finalized.”