13. CONFISCATION OF CRIME-RELATED PROCEEDS
AND PROPERTY
(24038)
14582/02
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Draft Framework Decision on confiscation of crime-related proceeds, instrumentalities and property.
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Legal base: | Articles 31 and 34(2)(b) EU; unanimity; consultation
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Document originated: | 28 November 2002
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Deposited in Parliament: | 3 December 2002
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Department: | Home Office
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Basis of consideration: | Minister's letter of 8 January 2003
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Previous Committee Report: | HC 63-v (2002-03), paragraph 8 (18 December 2002); and see (23065) 9956/02, (23811) 12250/1/02: HC 152-xli (2001-02), paragraph 9 (6 November 2002)
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To be discussed in Council: | No date fixed
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Committee's assessment: | Legally and political important
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Committee's decision: | Cleared
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Background
13.1 We last considered this proposal on 18 December
2002. We regarded it as a considerable improvement on previous
versions. We also noted the Government's remaining reservations
and expressed our own concern about the lack of clarity of some
provisions. We decided to ask the Minister for further information
and not to clear the document.
13.2 Like its predecessors, this version of the proposal
seeks to introduce new powers that would go beyond the existing
provisions for the confiscation of the proceeds of specific crimes.
Our remaining concerns as well as those of the Government all
relate to the revised Article 3, which requires Member States,
in certain circumstances, to introduce extended powers to confiscate
from the defendant property that is not the proceeds of the offence
of which he has been convicted.
13.3 In his Explanatory Memorandum of 10 December 2002
the Parliamentary Under-Secretary of State at the Home Office
(Mr Bob Ainsworth) expresses the Government's concern that the
revised proposal may not apply to money laundering offences. We
asked the Minister to clarify whether this meant that the Government
intended to oppose the proposal until an appropriately revised
text had been agreed which would ensure that extended confiscation
powers applied to money laundering offences throughout the EU.
13.4 The Minister also noted that in its revised form
Article 3(3), which states that Member States "may"
consider extending confiscation to the defendant's "closest
relations" and to legal persons "controlled" by
the defendant or by his closest relations, no longer imposed any
obligations and was therefore otiose. We asked the Minister for
assurance that this meant that the Government would seek to ensure
the deletion of Article 3(3). We also asked for an explanation
of the term "closest relations".
13.5 We also expressed our concern about the wording
of Article 3(2), which provides that Member States must introduce
the extended powers of confiscation under Article 3(1) "at
least where ... a national court based on specific facts is fully
convinced that the property in question has been derived from
criminal activities of the convicted person". We asked the
Minister to explain, first, whether the expression "fully
convinced" denoted the same standard of proof as "beyond
reasonable doubt" and, secondly, to clarify the meaning of
the phrase "criminal activities".
The Minister's reply
13.6 In his letter of 8 January 2003 the Minister writes
as follows:
"I note that the Committee considers the document we deposited
last month to be a considerable improvement on previous versions.
You raise issues on three particular areas, however: Article 3(3),
the application of extended confiscation powers to the offence
of money laundering, and the contents of Article 3(2).
"The Explanatory Memorandum of 10 December [2002] expressed
the view that Article 3(3) of the instrument was superfluous and
should be deleted. This was because it no longer imposed any obligations
on Member States, stating only that they "may consider"
extending confiscation to the defendant's closest relations etc.
Unfortunately, this text remains, but as the Article does not
require Member States actually to do anything, I do not think
we need to insist on its deletion.
"I agree that the meaning of "closest relations"
in Article 3(3) is not entirely clear. It would need to be interpreted
by any Member State that proposed to introduce the measures suggested
in the Article. However Article 3(3) would have no binding legal
effect on Member States. They will remain free to consider the
measures it suggests, or any other measures, anyway. Therefore,
even if the definition of "closest relations" was clearer,
this could not prevent Member States from extending confiscation
beyond that definition, if they wanted to. Therefore, tightening
the definition would not be of any practical value.
"I am pleased to say that we have now secured agreement to
the inclusion of money laundering in the list of offences to which
extended confiscation will apply. Therefore, the question of our
opposing the proposal until this is agreed to does not arise.
"So far as Article 3(2) is concerned, my understanding is
that the expression "fully convinced" represents a standard
of proof that is no lower than our criminal standard of "beyond
reasonable doubt". I do not consider the term "criminal
activities" to refer necessarily to criminal convictions,
either in the State imposing the confiscation or elsewhere. Rather,
I consider that it refers to circumstances in which the court
concludes that the defendants property has been acquired as a
result of illegal activities, regardless of whether he or she
has been convicted for such activities."
13.7 The Minister concludes with a general comparison
of the proposed measure with existing domestic legislation:
"Our own confiscation legislation the Proceeds of
Crime Act 2002 takes a similar, if broader approach. It
allows the Court, in certain circumstances, to confiscate a sum
equal to what it finds to be the defendant's benefit from crime,
even if he or she has not actually been convicted of acquiring
those assets illegally. The draft Framework Decision will not
require us to make any changes to our existing law on confiscation,
as set out in that legislation."
Conclusion
13.8 We thank the Minister for his reply, with its
welcome information that the Government has secured agreement
to include money laundering amongst the offences to which the
proposal will apply. We are grateful to the Minister for his explanation
of the effect of Article 3(2) and, in addition, for his helpful
comment that it does not go beyond existing domestic legislation.
13.9 In relation to Article 3(3), we note the Minister's
continuing doubts about the clarity of aspects of its wording
but we agree with him that seeking further amendment or deletion
of the provision would have little practical value when the Article
no longer requires Member States to do anything.
13.10 We also welcome the Minister's assurance that
the proposal will not require any changes to domestic legislation.
13.11 We have no further questions to put to the Minister
and are content to clear the document.
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