On May 2nd, Directive 2024/1260 of April 24th on asset recovery and confiscation was published in the Official Journal of the European Union. Member States will comply with it by November 23, 2026.
Subject matter and scope
The Directive aims to develop the EU strategy to tackle organized crime, among other things, by eliminating the illicit proceeds from criminal activities. Depriving criminals of illicit profits is essential in order to disrupt their activities and to prevent them from infiltrating legitimate economies. Criminal organizations indeed adversely affect the freedom of competition or influence decisions of public authorities, threatening the rule of law and democracy. The Directive lay down minimum rules on tracing and identification, freezing, confiscation, and management of assets of property within the framework of proceedings in criminal matters.
Criminal offences included in the scope of Directive
Criminal offences included in the scope of this Directive are terrorism, human trafficking and sexual exploitation of women and children, child pornography, illicit drug trafficking, illicit arms trafficking, money laundering, corruption, counterfeiting of means of payment, cybercrime, organized crime, fraud affecting the financial interests of the Union, fraud and counterfeiting of non-cash means of payment, counterfeiting of the euro and other currencies, environmental crime, pollution, market abuse, facilitation of illegal entry and residence.
Member States are in particular encouraged to ensure that the crimes of counterfeiting and piracy of products, illicit trafficking in cultural goods, forgery and trafficking of administrative documents, murder or grievous bodily injury, illicit trade in human organs and tissue, kidnapping, illegal restraint or hostage-taking, organized or armed robbery, racketeering and extortion, trafficking in stolen vehicles, tax crimes relating to direct taxes and indirect taxes, arson, fraud and swindling, illicit trafficking in nuclear or radioactive materials and crimes which fall within the jurisdiction of the International Criminal Court are included in the scope of this Directive.
The confiscation of property and proceeds
The confiscation measures shall be applied on property and proceeds. Property means property of any description, whether corporeal or incorporeal, movable or immovable, including crypto-assets, and legal documents or instruments in any form, evidencing title or interest in such property. Proceeds means any economic advantage derived directly or indirectly from a criminal offence consisting of any form of property, and including any subsequent reinvestment or transformation of direct proceeds and any valuable benefits.
The freezing and confiscation measures
Freezing means the temporary prohibition of the transfer, destruction, conversion, disposal or movement of property or temporarily assuming custody or control of property. The freezing measures shall consist of freezing orders and immediate action.
Confiscation
Confiscation means a final deprivation of property ordered by a court in relation to a criminal offence.
In addition to confiscation measures that allow authorities to deprive criminals of the instrumentalities or proceeds, subject to a final conviction, it is established to enable confiscation of property of equivalent value to such instrumentalities or proceeds in order to capture property of equivalent value to the instrumentalities and proceeds of a crime, where it is impossible to confiscate such instrumentalities and proceeds.
Confiscation from a third party
Member States shall take the necessary measures to enable the confiscation of proceeds, or other property the value of which corresponds to proceeds, which, directly or indirectly, were transferred by a suspected or accused person to third parties, or which were acquired by third parties from a suspected or accused person.
Extended confiscation
Member States shall take the necessary measures to enable the confiscation of property belonging to a person convicted of a criminal offence where the offence committed is liable to give rise, directly or indirectly, to economic benefit, and where a national court is satisfied that the property is derived from criminal conduct.
Non-conviction-based confiscation
Member States shall take the necessary measures to enable, where the confiscation measures may not be applied, the confiscation of property identified in the context of an investigation in relation to a criminal offence, provided that a national court is satisfied that the identified property is derived from criminal conduct committed within the framework of a criminal organization and that conduct is liable to give rise, directly or indirectly, to substantial economic benefit.
The persons affected by confiscation
Freezing and confiscation orders can be issued against persons, entities and such confiscation should be possible at least in cases where it has been established that the relevant third parties knew or ought to have known that the purpose of the transfer or acquisition was to avoid confiscation.
Compensation of victims and social reuse of confiscated property
Member States should take appropriate measures to ensure that victims’ claims to restitution and compensation against the person who is subject to a confiscation measure as a result of a criminal offence are taken into account in asset-tracing, freezing and confiscation proceedings, including in cross-border cases.
Member States are encouraged to take the necessary measures to allow for the possibility to use confiscated property for public interest or social purposes, so that it is possible to maintain confiscated property as State property for justice, law enforcement, public service, social or economic purposes or to transfer such confiscated property to the authorities from the municipality or region where it is located so that those authorities can use it for such purposes, including for assignment to organizations carrying out work of social interest.
Member States may use the instrumentalities, proceeds or property confiscated to contribute to mechanisms to support third countries affected by situations in response to which Union restrictive measures have been adopted, in particular in cases of war of aggression.
Operational procedures
Each Member State shall set up at least one asset recovery office to facilitate cross-border cooperation in relation to asset-tracing investigations with competent national authorities and EPPO.
Member States shall take the necessary measures to ensure that asset recovery offices can swiftly obtain that information from relevant institutions by other means in a streamlined and standardized manner.
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