Proposal for a Council framework Decision on combating fraud and counterfeiting of non-cash means of payment
C 376 E/20 EN Official Journal of the European Communities 28. 12. 1999 Proposal for a Council Framework Decision on combating fraud and counterfeiting of non-cash means of payment (1999/C 376 E/03) COM(1999) 438 final - 1999/0190(CNS) (Submitted by the Commission on 15 September 1999) THE COUNCIL OF THE EUROPEAN UNION, Having regard to the Treaty on European Union, and in particular Article 34(2)(b) thereof, Having regard to the initiative of the Commission, Having regard to the opinion of the European Parliament, Whereas: (1) Fraud and counterfeiting of non-cash means of payment often operate on an international scale. (2) The work developed by various international organi- sations (i. e. the Council of Europe, the Group of Eight, the OECD, Interpol and the UN) is important, but needs to be complemented by action of the European Union. (3) The Council considers that crime (1), require comprehensive the seriousness and devel- opment of certain forms of fraud regarding non-cash solutions; means of payment Recommendation No 18 of the Action Plan to combat the Amsterdam approved organised European Council on 16 and 17 June 1997, as well as the Council and the point 46 of Commission on how to implement the provisions of the Treaty of Amsterdam on an area of freedom, security and justice (2), approved by the Vienna European Council on 11 and 12 December 1998, call for an action on this subject. the Action Plan of by of the this (4) In accordance with the principles of subsidiarity and proportionality, Framework objectives Decision, namely to ensure that fraud and counterfeiting involving all forms of non-cash means of payment are recognised as criminal offences and are subject to effective, proportionate and dissuasive sanctions in all Member States cannot be sufficiently achieved by the Member States in view of the international dimension of those offences and can therefore be better achieved by the European Union; this Framework Decision confines itself to the minimum required in order to achieve those objectives and does not go beyond what is necessary for that purpose. (1) OJ C 251, 15. 8. 1997, p. 1. (2) OJ C 19, 23. 1. 1999, p. 1. (5) This Framework Decision should assist in the fight against fraud and counterfeiting involving non-cash means of payment together with other instruments already agreed by the Council such as Joint Action 98/428/JHA (3) on the creation of a European judicial network, Joint Action 98/733/JHA (4) on making it a criminal offence to participate in a criminal organisation in the Member States of the European Union, Joint Action 98/699/JHA (5) on money laundering, the identification, tracing, freezing, seizing and confiscation of instrumentalities and the proceeds from crime, as well as the Decision of 29 April 1999 extending Europol’s mandate to deal with forgery of money and means of payment (6). (6) The Commission submitted to the Council, on 1 July 1998, the Communication entitled A framework for action combating fraud and counterfeit of non-cash means of paymentí (7) which advocates a Union policy covering both preventive and repressive aspects of the problem. (7) The Communication contains a draft Joint Action which is one and constitutes the starting point for this Framework Decision. comprehensive element of approach, that (8) It is necessary that a description of the different forms of behaviour requiring criminalisation in relation to fraud and counterfeiting of non-cash means of payment should cover the whole range of activities that together constitute the menace of organised crime in this regard. (9) It is necessary that these forms of behaviour be classified in all Member States, and that as criminal offences effective, proportionate sanctions be provided for natural and legal persons having committed or being liable for such offences, and that the offences in the legislation question be regarded as falling under directed against money laundering. and dissuasive (10) It is necessary that Member States consult each other when two or more Member States have jurisdiction over the same offence. (3) OJ L 191, 7. 7. 1998, p. 4. (4) OJ L 351, 29. 12. 1998, p. 1. (5) OJ L 333, 9. 12. 1998, p. 1. (6) OJ C 149, 28. 5. 1999, p. 16. (7) COM(1998) 395 final. 28. 12. 1999 EN Official Journal of the European Communities C 376 E/21 (11) It is also necessary that Member States establish effective cooperation with the private services and bodies having responsibilities in the functioning and monitoring of the payment systems, and that the Member States afford each other the widest measure of mutual assistance, For the purpose of this Framework Decision, a ánationalí 2. of a Member State shall be construed in accordance with any declaration made by that State under Article 6(1)(b) of the European Convention on Extradition of 13 December 1957. HAS ADOPTED THIS FRAMEWORK DECISION: Article 1 Definitions For the purposes of 1. this Framework Decision, and without prejudice to more specific definitions in the Member States’ legislation: (a) Payment instrumentí or ánon-cash payment instrumentí means an instrument other than legal tender (bank notes and coins) enabling, alone or in conjunction with another instrument, the legitimate holder or payer, to (payment) obtain money or valuable consideration, to make or receive payments in respect of goods, services or any other thing of value, or to issue an order or message requesting or otherwise authorising the transfer of funds (in the form of a monetary claim on a party) to the order of a payee; transactioní means the obtaining of money or (b) Payment valuable receiving of the making or consideration, payments in respect of goods, services or any other thing of value, or the issuing of an order or message requesting or otherwise authorising the transfer of funds (in the form of a monetary claim on a party) to the order of a payee, through a payment instrument; (c) Device-making any equipment equipmentí means (including software) designed or adapted for the access, manufacture or alteration of any, or part of any, payment include instrument or payment equipment designed or adapted to change or alter any information or data carried on or in any payment instrument or payment transaction; transaction and shall (d) Legal personí means any entity having such status under the applicable law, except for States or other public bodies in the exercise of State authority and for public inter- national organisations; (e) Money launderingí means the conduct as defined in the Council Directive of Article indent of 1 third 91/308/EEC (1). (1) OJ L 166, 28. 6. 1991, p. 77. Article 2 Description of behaviour The measures set out in Articles 3 to 6 relate to the following types of intentional behaviour: (a) misappropriation of a payment instrument; (b) counterfeiting or falsification of a payment instrument; (c) knowingly handling a payment instrument, without the holder’s authorisation; (d) knowingly possessing a misappropriated, counterfeited or falsified payment instrument; (e) knowingly using a misappropriated, counterfeited or instrument; or knowingly accepting a falsified payment payment made in such circumstances; (f) knowingly using unauthorised identification data for initiating or processing a payment transaction; (g) knowingly using fictitious identification data for initiating or processing a payment transaction; (h) manipulation account information, or other identification data, for initiating or processing a payment transaction; including relevant data of (i) unauthorised transmission of initiating or processing a payment transaction; identification data for (j) unauthorised making, handling, possession or use of specifically adapted equipment or elements of payment instruments for the purpose of: - manufacturing or altering any payment instrument or part thereof; - committing the fraudulent acts described in points (f) to (i). set out The measures in Articles 3 to 6 also relate to involvement as accessory or instigator in the acts described in paragraph 1 or knowingly obtaining valuable consideration or a pecuniary advantage from any such acts. C 376 E/22 EN Official Journal of the European Communities 28. 12. 1999 Article 3 Measures to be taken at national level 1. Member States shall classify the types of behaviour set out in Article 2 as criminal offences. 2. Member States shall provide that legal persons can be held liable for in paragraph 1 the offences provided for committed for their benefit by any person, whether acting individually or as part of an organ of the legal person, who holds a leading position within the legal person, on the basis of: (a) a power of representation of the legal person, or (b) an authority to take decisions on behalf of the legal person, or (c) an authority to exercise control within the legal person. 3. Member States shall provide that the penalties for the offences referred to in paragraph 1 shall: (a) in so far as natural persons are concerned, be effective, proportionate and dissuasive criminal sanctions entailing, at least in serious cases, penalties involving privation of liberty and capable of giving rise to extradition; (b) in so far as legal persons are concerned, be effective, proportionate and dissuasive sanctions which shall include criminal or non-criminal fines and may entail other sanctions such as: (i) exclusion from entitlement to public benefits or aid; (ii) temporary or permanent disqualification from the practice of commercial activities; (iii) placing under judicial supervision; (iv) a judicial winding-up order. Subject to the provisions of paragraph 2, any Member State may limit the application of its jurisdiction to the circum- stances laid down in point (a). A Member State which does not apply such a limitation may nevertheless assume juris- diction in the circumstances laid down in point (b) only in specific cases or subject to special conditions. 2. Where a Member State does not extradite its nationals, it in shall establish its jurisdiction over the offences set out Article 3 when these are committed by its own nationals outside its territory. Each Member State shall, when one of its nationals is suspected of having committed in another Member State one of the offences provided for in Article 3 but it does not extradite that person to that other Member State solely on the grounds of his nationality, submit the case to its competent authorities for the purpose of prosecution if appropriate. In order the files, to enable prosecution to take place, information and exhibits relating to the offence shall be trans- mitted in accordance with the procedures laid down in Article 6 of the European Convention on Extradition of 13 December 1957. The requesting Member State shall be informed of the pros- ecution initiated and of its outcome. Article 5 Cooperation from public and private services or bodies Each Member State shall take the necessary measures to 1. ensure that the public and private services and bodies engaged in managing, monitoring and overseeing the payment systems, will cooperate with the authorities responsible for investigation and punishment of the offences established by this Framework Decision. In particular, the services and bodies shall: The offences 4. referred to in paragraph 1 shall be considered serious crimes for the purpose of the application of Joint Action 98/699/JHA. (a) advise those authorities on their own initiative, where there are reasonable grounds for considering that one of the offences has been committed; Article 4 Jurisdiction (b) provide those authorities with all relevant information either on request or on their own initiative. Each Member State shall establish its jurisdiction over the 1. offences provided for in Article 3 where: (a) the offence is committed in whole or in part within its territory; 2. As regards the processing of personal data, paragraph 1 shall be implemented so as to ensure a level of protection equivalent to the protection required by European Parliament and Council Directive 95/46/EC (1). Data shall be used only for the purposes for which it has been transmitted. (b) the offender is one of its nationals. (1) OJ L 281, 23. 11. 1995, p. 31. 28. 12. 1999 EN Official Journal of the European Communities C 376 E/23 Article 6 Cooperation between Member States 1. In accordance with the applicable conventions, multi- lateral or bilateral agreements or arrangements Member States shall afford each other the widest measure of mutual assistance in respect of proceedings relating to the offences provided for in this Framework Decision. 2. Where several Member States have jurisdiction in respect of offences envisaged by this Framework Decision, those States shall consult one another with a view to coordinating their action in order to prosecute effectively. Article 7 Implementation 1. Member States shall bring into force the laws, regulations and administrative provisions necessary to comply with this Framework Decision on 31 December 2000 at the latest. They shall forthwith inform the Commission thereof and provide it with copies of the measures through which the Framework Decision is implemented. When Member States adopt those provisions, they shall contain a reference to this Directive or be accompanied by such a reference on the occasion of their official publication. Member States shall determine how such reference is to be made. 2. The Commission shall submit a report to the Council on the fulfilment by Member States of their obligations under this Framework Decision, not later than two years after its entry into force. Article 8 Entry into force This Framework Decision shall enter into force on the date of its publication in the Official the European Communities. Journal of Article 9 Addressees This Framework Decision is addressed to the Member States