Until EU Regulation n. 883/2013 came into force, safeguarding the financial interests of the European Union had always been an important – but not central – issue, not least because the European budget was much more modest than those of the MS themselves. The legal and economics sciences, however, have tended to show little interest in the topic, which has been examined mainly from the criminal law perspective as a means of combating fraud.
The Next Generation EU (NGEU) has brought about a significant shift in the paradigm of European economic governance and has revitalized the European integration process through the Community method, placing the protection of the European Union’s financial interests at the core of the European legal order. It can be argued that protecting the financial interests of the European Union has contributed to the further evolution of the financialization of legal and political arrangements, fostering the process of European integration and becoming one of its guiding principles. Under certain circumstances, the standard of protection for the financial interests of the European Union is today not solely determined by referring to the level of protection at the national level. This contrasts with the usual practice when implementing the assimilation principle. Rather, the European rules contribute to shaping the national system for the protection of public financial resources. This seems to be happening under the not-too-gentle pressure of EU law, both on the administrative side (due, for example, to the management of the vast funds allocated through the RRF) and, in certain jurisdictions/cases, from the criminal law perspective (in the contest of the implementation of the PIF Directive and of the EPPO regulation). Given the high stakes involved, generating specialized knowledge around the protection of the EU’s financial interests is now more urgent than ever.
In this context, Better Knowledge for the Next Generations (BETKONEXT) will showcase and advance the results of a previous Hercule III funded project, Better Knowledge for Better Solutions (BETKOSOL: available below key information about the old project), by pursuing two main research objectives: assessing the suitability of the normative tools in place to ensure multilateral and multilevel cooperation and update the BETKOSOL project’s final recommendations a year and a half after the ‘birth’ of the EPPO.
In addition to the work-packages described below, we aim to build a network to share best practices across Europe and collect practical solutions to enhance cooperation between national and EU levels. It will do so through the lens of an innovative comparative study, which will additionally benefit from the involvement of selected national institutions operating in the sector in question (i.e., the Italian Anti-Fraud Co-ordinating Structure of the Presidency of the Council of Ministers – AFCOS; see “Other annexes”).
In this way, the results from the comparative law study could be tested in operative scenarios and serve both for “law in the book” and for “law in action”. The general objectives include the following points: – to critically analyse the different institutional cooperation strategies in the sector, considering both the administrative and criminal perspectives at the EU and national levels; – to foster better knowledge, especially in terms of procedures and rules. This can support mutual understanding and the creation of a common path towards the effective protection of the EU’s financial interests; – to specify the different shades of meaning implicit in the term “financial interests” and their protection in Europe today; – trace the changes to the regulations, showing the main directions in the history/evolution of the protection of the EU’s financial interests.
The research will be articulated along 4 work packages:
WP1 addresses four selected Member States (SP, IT, BE, PO) in connection with EU institutions. On the one hand, it will outline the future of the national anti-fraud contact points network. On the other hand, the work of the new European prosecutor’s office for the protection of the EU’s FI will be addressed, as its activity raises several questions in terms of institutional coordination, to be further addressed one and a half years after it came into operation. The project will also focus on institutional cooperation between the various EU bodies involved in the sector, with a special focus on OLAF’s work, trying to analyse also the efficiency of the OLAF Regulation.
WP2 will cover other key topics. From the administrative law perspective, the so-called PACA system, the role of new digital platforms, such as those under the Recovery and Resilience Facility (RRF), the adoption of a model of controls based on risk assessments for irregularities and fraud, and the role of fair financial management and financial reporting, will be analysed. On the criminal law side, the focus will be on the full implementation of the PIF directive, so to identify the most recurrent conformity issues in the selected MS to see how they intersect with the EPPO’s work.
WP3 is entirely dedicated to a case study approach for the analysis of significant and/or recent fraudulent schemes affecting EU FI, giving priority to the following sectors: green economy, digital market, new own resources, the RRF, and some aspects related to money laundering.
WP4 will be dedicated to the dissemination and re-elaboration of previous materials, showcasing the inputs from workshops and seminars with the institutions.
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BETKOSOL took place at the LUISS-Libera Università degli Studi Sociali “Guido Carli” during the course of 18 months, from January 2021 to June 2022. The LUISS “Guido Carli” was the leaders of the comparative law study but, as important research experts and research centers, the Department of Criminology, Criminal Law and Social Law (UGent) was involved too.
BETKOSOL aimed to investigate the limits and perspectives of an improvement of the current regulatory framework in the fight against frauds affecting EU financial interests, in particular in the social, health, and economic sectors, and taking into account how the COVID-19 crisis may affect the status quo. The first step was a legal analysis, both at the EU level of government and at selected national experiences (Belgium, Germany, Italy, and Poland) in a comparative perspective. The MS were chosen for their different economic, administrative, and welfare systems. They also varied in terms of the impact of the COVID-19 crisis. This ensured greater awareness of the European context. The second was to study how the COVID-19 crisis modified the multilevel framework. In this view, BETKOSOL examined the new multiannual financial framework, especially public procurement for sanitary equipment in ESM and RF expenditures; EUSF; SURE; ESF; EIF; ERASMUS+. The third step was to highlight the new risks and causes of fraud, considering that the extreme historical contingencies provided a newfangled point of view to show challenges with the protection of the EU’s financial interests in quite ‘new’ sectors. These steps were analyzed transversely in the first 3 correspondents WP’s and through a mixed-method (doctrinal/empirical). The WP4 (better regulation) was based on the outputs from the previous ones (better knowledge and funding). A strategy to improve the long-term outcomes of the European anti-fraud policy was proposed, in the direction to face risks that the new health crisis will show. The main focus was on the functioning of (i) the shared administration to prevent fraud; (ii) the territorial control network (iii) the inspection activity for the detection of a (limited) number and typology of cases to be addressed by OLAF and EPPO. BETKOSOL also had a social impact, involving students (Open Days) and citizens (empirical study).
