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Mutual recognition of financial penalties

This framework decision extends the principle of mutual recognition, the cornerstone of judicial cooperation, to financial penalties.

ACT

Council Framework Decision 2005/214/JHA of 24 February 2005 on the application of the principle of mutual recognition to financial penalties [See amending act(s)].

SUMMARY

This framework decision is the result of an initiative of the United Kingdom, the French Republic and the Kingdom of Sweden. It extends the principle of mutual recognition to financial penalties imposed by the judicial and administrative authorities of another Member State.

Recognition and enforcement of decisions

The principle of mutual recognition of decisions applies to financial penalties *. The competent authorities must recognise decisions relating to financial penalties transmitted by another Member State without any further formality.

These penalties are imposed in the case of infringements that cover actions such as participation in a criminal organisation, terrorism, trafficking in human beings, trafficking in arms, swindling, trafficking in stolen vehicles, rape, etc. The framework decision also covers financial penalties for road traffic offences.

In the case of infringements not listed in the framework decision, the state executing the decision of another state can make its recognition and execution subject to the decision being related to conduct that would constitute an offence under its national law.

The decision imposing a financial penalty can relate to both a natural person (human being) and a legal person (company).

The penalties must be imposed by the judicial or administrative authorities of the Member States. Each Member State will inform the General Secretariat of the Council which authority is competent under its national law. The decision imposing a financial penalty must be final, i.e. there is no longer any possibility to appeal the decision. On account of the organisation of their internal systems, Member States may designate one or more central authorities responsible for the management of the transmission of decisions.

Transmission of decisions

The decision imposing a financial penalty is transmitted from the "issuing state", i.e. the Member State that delivered the decision, to the "executing state", i.e. the Member State that executes the decision in its territory. To this effect, the framework decision provides a certificate in its annex that must accompany the decision. This certificate must be made out in the official language of the executing state. The issuing state will only transmit a decision to one executing state at any one time. The decision is transmitted to the competent authorities of the Member State where the natural or legal person has property or income, is normally resident or, in the case of a legal person, has its registered seat. Member States will not call for reimbursement of the costs resulting from the application of this framework decision.

Provision is made for a special system for Ireland and the United Kingdom; these states may declare that the decision together with the certificate must be sent via their designated central authority. These Member States can limit the scope of the declaration at any time for the purpose of giving greater effect to the management of the transmission of decisions. They will do so when the provisions on mutual assistance of the Schengen Implementation Convention are put into effect for them.

Grounds for non-recognition and non-execution

The state to which the decision was transmitted can refuse to execute the decision if the certificate provided for by this framework decision is not produced, is incomplete or manifestly does not correspond to the decision.

Execution can also be refused if it is established that:

  • the decision has been delivered in respect of the same acts in the executing state or in any state other than the issuing or executing state and, in the latter case, has been executed;
  • the decision relates to an act that is neither listed as an infringement in the framework decision nor constitutes an offence under the national law of the executing state;
  • the execution of the decision is statute-barred according to the law of the executing state and relates to acts that fall within the jurisdiction of that state under its own law;
  • the decision relates to acts that are regarded by the law of the executing state as having been committed in its territory or to acts committed outside the territory of the executing state when its national law does not allow for the prosecution of such acts;
  • there is immunity under the law of the executing state, which makes it impossible to execute the decision;
  • the decision has been imposed on a person who could not have been held criminally liable under the law of the executing state due to his/her age;
  • according to the certificate that accompanies the decision, the person concerned was not informed of the right to contest the case and of the time limits of such a legal remedy;
  • the decision provides that the financial penalty will be below EUR 70 or the equivalent;
  • according to the certificate that accompanies the decision, the person concerned did not personally appear at the trial, except where the certificate states that the person was informed of the date and place of the trial and that a decision may be handed down there regardless of his/her presence, or where the person was represented by a legal counsellor, or where information on the right to a retrial or appeal was provided, yet the person did not contest the decision nor request a retrial or an appeal within the set time limit;
  • according to the certificate that accompanies the decision, the person concerned did not personally appear at the trial, except where the certificate states that the person had waived his/her right to an oral hearing as well as indicated that s/he did not contest the case.

Fundamental rights and other legal aspects

This framework decision respects fundamental rights.

The framework decision provides that the execution of the decision is governed by the law of the executing state. The latter can also decide to reduce the amount of the financial penalty in accordance with the amount provided for by national law, on condition that the acts had not been committed in the territory of the issuing state. A financial penalty imposed on a company will be enforced even if the executing state does not recognise the principle of criminal liability of legal persons. It can impose imprisonment or other penalties provided for by national law in the event of non-recovery of the financial penalty. Amnesty, pardon and review of sentence can be granted by both the issuing state and the executing state. Monies obtained from the enforcement of decisions will accrue to the executing state, unless otherwise agreed by the respective Member States.

This framework decision also applies to Gibraltar.

Member States will take the necessary measures to comply with the framework decision by 22 March 2007. The framework decision provides for a transitional period of 5 years from the date of entry into force.

Key terms used in the act

Financial penalty: the obligation to pay:

  • a sum of money on conviction of an offence (which must be listed in the framework decision);
  • compensation for victims;
  • costs of court or administrative proceedings;
  • sums of money to a public fund or a victim support organisation.

REFERENCES

ActEntry into forceDeadline for transposition in the Member StatesOfficial Journal
Framework Decision 2005/214/JHA

22.3.2005

22.3.2007

OJ L 76 of 22.3.2005

Amending act(s)Entry into forceDeadline for transposition in the Member StatesOfficial Journal
Framework Decision 2009/299/JHA

28.3.2009

28.3.2011

OJ L 81 of 27.3.2009

RELATED ACTS

Report from the Commission of 22 December 2008 based on Article 20 of the Council Framework Decision 2005/214/JHA of 24 February 2005 on the application of the principle of mutual recognition to financial penalties [COM(2008) 888 final – Not published in the Official Journal].
This report evaluates the measures Member States have taken to transpose the provisions of Framework Decision 2005/214/JHA into national law. However, by October 2008, only 11 Member States had notified the Commission of the transposition, which is not sufficient for making a full assessment of the implementation of the framework decision at this point in time.
The implementing provisions of these 11 Member States are generally in line with the framework decision, especially among the most important issues such as the recognition and execution of decisions without any further formality and without verification of dual criminality. In addition, most Member States have applied the provisions concerning alternative sanctions, amnesty, pardon and review of sentences, as well as those concerning the accrual of monies obtained from the enforcement of decisions.
With regard to the law governing the enforcement of decisions, some of the Member States have only partially implemented the provisions.
Furthermore, the optional provisions on the grounds that may constitute a basis for refusing the recognition or execution of a decision were transposed in most Member States as obligatory. Several Member States have also laid down additional grounds for refusal, which is not in line with the framework decision.
The Commission encourages Member States to take into consideration this report, proceed with the necessary legislative actions and transmit the relevant information in accordance with the provisions of Article 20 of the framework decision to the Commission and the General Secretariat of the Council of the European Union.

Last updated: 20.08.2009
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