PENAL SANCTIONS AGAINST COUNTERFEITING
IN CONNECTION WITH THE INTRODUCTION OF THE EURO
(a)
(20339)
9966/99
—
(b)
(20624)
12585/99
—
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Draft Framework Decision on increasing protection by penal sanctions against counterfeiting in connection with the introduction of the euro.
Draft Framework Decision on increasing protection by penal sanctions against counterfeiting in connection with the introduction of the euro.
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| Legal base:
| Articles 31(e) and 34(2)(b) EU; consultation; unanimity
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| Deposited in Parliament:
| (b) 10 November 1999 |
| Department:
| Home Office |
| Basis of consideration:
| (b) EM of 18 November 1999
|
| Previous Committee Report:
| (a) HC 34-xxviii (1998-99), paragraph 12 (20 October 1999)
(b) None
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| To be discussed in Council:
| 2-3 December 1999 |
| Committee's assessment:
| Legally and politically important
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| Committee's decision:
| (a) Cleared
(b) Not cleared; further information requested
|
Background
3.1 When we first considered this draft
Decision (in October 1999), we raised questions about the Government's
position in relation to some of the jurisdiction issues, and did
not, therefore clear the document. An amended text and EM have
now been deposited.
The document
3.2 The new text reflects the views of delegations
on the original proposal by Germany. The most significant changes
relate to Article 7 (Jurisdiction). Two new Articles — 8
and 9, dealing with legal persons (ie companies) — have
now been added.
The Government's views
3.3 On the document as a whole, the Minister
of State at the Home Office (Mrs Barbara Roche) says:
"The Government fully
supports the aims of the draft Framework Decision, and believes
that concerted action across the European Union is required to
prevent counterfeiting of the Euro. The Government is, in general,
content with the provisions contained in the draft Framework Decision".
3.4 She comments in more detail on specific
Articles, as follows:
"Article 6 requires
all Member States to be able to punish counterfeiting offences
by effective, proportionate and dissuasive sanctions, including
the possibility of imprisonment which could give rise to extradition
(i.e. under the European Extradition Convention, imprisonment
for 12 months). Negotiations are continuing on the possibility
of setting higher penalties for the more serious offences. (In
the UK, the maximum penalty for most counterfeiting offences is
10 years). The UK could agree to higher level penalties provided
that these were not expressed in a way which limited judicial
discretion on the appropriate level of sentence in each case.
Article 7 (1)
"The first indent requires Member States to
establish jurisdiction for offences of counterfeiting of any
currency which have been committed in whole or in part in
their territory. At present, the UK has jurisdiction over offences
of counterfeiting of currency only where the offence takes place
wholly, or the last act is completed, on UK territory (territorial
jurisdiction). However, to meet the requirement of the draft Framework
Decision, the Government is prepared to extend UK jurisdiction
to offences which have been committed in whole or in part in UK
territory. This can be achieved without primary legislation through
an amendment to Part 1 of the Criminal Justice Act 1993. The 1993
Act empowers the Secretary of State for the Home Department, by
order, to add or remove offences [Section 1(4))]. The power to
make such an order is exercisable by statutory instrument and
is subject to affirmative resolution in each House of Parliament
[Sections 1(5) and 1(6)].
"The second indent requires Member States to
establish jurisdiction for offences committed abroad by their
own nationals, but paragraph 3 allows Member States to decide
not to apply the second indent. The UK may wish to make use of
this waiver.
Article 7 (2)
"Article 7(2) has been amended so that the requirement
to take universal jurisdiction for offences of counterfeiting
the euro applies only to Member States that have adopted the euro.
This would mean that UK courts would not be obliged to try offences
of counterfeiting of the euro which had been committed outside
the UK unless it adopted the euro as its currency. The UK has
taken universal jurisdiction only for a small number of very serious
crimes against humanity or State security (for example, torture,
hostage taking and terrorism). In all other cases, the UK has
territorial jurisdiction, including counterfeiting offences involving
sterling. The primary reason for this is that the heavy reliance
on oral evidence within the English legal system makes it very
difficult, and costly, to mount successful prosecutions for offences
committed outside the UK.
"In view of these difficulties the UK has proposed
the inclusion of Article 7(2a). This specifies that Article 7(2)
would not apply to Member States who are not members of the euro
at the time that the Framework Decision is adopted. Instead the
Council will examine, when a Member State applies to adopt the
euro, how to ensure that the offences referred to in Article 7(2)
will be punishable in a Member State (not necessarily the Member
State where an offender first comes to notice). A number of delegations
have entered scrutiny reservations on this proposal, and negotiations
on this part of the text are continuing. Another possible option
that has been suggested is to align Article 7 with Articles 8
and 9 of the 1929 Convention[24],
under which countries which as a general rule accept the principle
of extraterritorial jurisdiction are obliged to apply it in the
case of counterfeiting offences.
Articles 8 and 9
"Articles 8 and 9 are additions
to the original text of the draft Framework Decision. They introduce
a requirement for Member States to ensure that legal persons,
under certain conditions, can be held liable for the offences
outlined in Article 3. The Government believes that this addition
is a useful and practical one, and supports the inclusion of the
Articles, providing that Article 9 is not amended so that it requires
any criminal penalties to be imposed (at present either
criminal or administrative penalties are permitted)."
3.5 The Minister tells us that the Presidency
hopes to secure political agreement on the draft Framework Decision
at the Justice and Home Affairs Council on 2-3 December 1999.
Conclusion
3.6 The first of our outstanding questions
related to whether the Minister intended to extend UK jurisdiction
to counterfeiting offences committed in whole or in part in UK
territory and, if so, how she could do so without primary legislation.
She has answered this satisfactorily in her commentary on Article
7 (1), quoted in paragraph 3.4 above.
3.7 Our second question sought the Minister's
views on whether, in certain circumstances, there could be advantages
in an Article requiring Member States to take universal jurisdiction
for offences of counterfeiting the euro. The EM does not directly
address the question. However, as the new Article 7 (2) will apply
to almost all Member States, the question becomes less pertinent,
and we are content to consider the matter settled.
3.8 We have, however, some concern about
the proposed legal base for the draft Framework Decision. While
we are pleased that 34(2)(b) — which sets out the general
purpose of framework decisions — is not the sole Article
cited, the scope of 31(e) — the Article which should provide
the specific purpose for this measure — does not obviously
encompass counterfeiting. Is the Government content with the proposed
base; if so, why?
3.9 In addition, we note that our sister
Committee in the House of Lords has a number of pertinent questions
on the amended draft. While, therefore, we are content to clear
the earlier version, document (a), we shall keep the current text,
document (b), under scrutiny until we have the response to that
Committee's questions as well as to ours.
24 The International Convention of 20 April 1929 for
the Suppression of Counterfeiting Currency. Back
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