Further Harmonization of EU Sanctions Enforcement: Violations of EU Sanctions Added as “EU Crimes”
On November 28, 2022, the Council of the European Union (“Council”) unanimously adopted a decision to add the violation of EU sanctions (“restrictive measures”) to the “List of EU Crimes” as identified in the Treaty on the Functioning of the EU (“TFEU”).1 First proposed by the European Commission on May 25, 2022, this addition is another illustration of the EU’s increased efforts to further harmonize the enforcement of its sanctions regimes.2
The Decision adds “the violation of Union restrictive measures” among the crimes currently already identified as “particularly serious crimes with a cross-border dimension” in Article 83(1) of the TFEU—i.e., “terrorism, trafficking in human beings and sexual exploitation of women and children, illicit drug trafficking, illicit arms trafficking, money laundering, corruption, counterfeiting of means of payment, computer crime and organised crime”.
The implications of the Decision are that the Council and the European Parliament obtain the power to adopt minimum rules in respect of the definition of certain criminal offences and penalties in respect of violations of EU sanctions. Prior to this, EU member states had been exclusively competent for the definition of criminal offences in respect of sanctions violations as well as the provision of penalties.
The expectation is that, in the medium-to-long term, the recognition of EU sanctions violations as an EU crime will lead to a (greater) degree of harmonization of the enforcement policies and penalties applicable in EU member states.
Towards further harmonization of EU sanctions implementation and enforcement
The adoption of the Decision is in line with previous efforts to harmonize EU sanctions implementation and enforcement. Indeed, on October 24, 2022, EU Commissioner for Financial Services, Financial Stability and Capital Markets Union Mairead McGuinness chaired a high-level meeting with the relevant competent authorities from member states on sanctions implementation.3 As a result of that meeting, the European Commission has been tasked with:
- organizing a structured and comprehensive exchange of best practices among member states on setting up efficient and effective internal structures—in particular, improved internal coordination;
- establishing a new mechanism allowing member states to contact each other and exchange information in real time on derogations and authorisations in respect of EU sanctions insofar as there is a cross-border dimension and on entities owned and controlled by listed persons; and
- creating a work stream on circumvention with an Experts’ Conference.
Next steps
The Decision should enter into force on the day following its publication in the EU’s Official Journal in order to “enable, as a matter of urgency, the adoption of secondary legislation establishing minimum rules on the definition of and penalties for the crime of violating Union restrictive measures”. Indeed, the European Commission has already been tasked with preparing a proposal for a Directive providing for minimum rules concerning the definition of criminal offences and penalties for the violation of EU sanctions. This proposed Directive will need to be approved by the Council and the European Parliament. The adoption of the Decision also will give traction to the Commission’s proposal for a Directive on “asset recovery and confiscation,” which it had also presented on May 25, 2022, and which had anticipated the adoption of the Decision.4
1 See Council of the European Union, Council Decision on identifying the violation of Union restrictive measures as an area of crime that meets the criteria specified in Article 83(1) of the Treaty on the Functioning of the European Union (“Decision”). Available at https://data.consilium.europa.eu/doc/document/ST-10287-2022-REV-1/en/pdf.
2 See European Commission, Proposal for a Council Decision on adding the violation of Union restrictive measures to the areas of crime laid down in Article 83(1) of the Treaty on the Functioning of the European Union, 25 May 2022, COM(2022) 247 final. Available at https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=COM:2022:0247:FIN. See also https://ec.europa.eu/commission/presscorner/detail/en/IP_22_3264.
3 See European Commission, Statement by Commissioner McGuinness on the outcomes of the first meeting of the high-level meeting on sanctions implementation, 24 October 2022. Available at https://finance.ec.europa.eu/news/statement-commissioner-mcguinness-outcomes-first-meeting-high-level-meeting-sanctions-implementation-2022-10-24_en.
4 European Commission, Proposal for a Directive of the European Parliament and of the Council on Asset Recovery and Confiscation, 25 May 2022, COM(2022) 245 final. Available at https://eur-lex.europa.eu/legal-content/EN/ALL/?uri=CELEX:52022PC0245.
