CJEU establishes clear rules on serious EU budget fraud: €50,000 threshold decisive
The Court of Justice of the European Union has clarified what constitutes "serious fraud" damaging the community budget and how cases with expiration of statute of limitations should be treated in Romania.
CJEU establishes clear rules on serious EU budget fraud: €50,000 threshold decisive
European judges issued on Thursday, 16 July, a binding interpretation concerning offences prejudicing community funds. The ruling comes in the context of a preliminary reference submitted by Romania's highest criminal court.
At the centre of the dispute is a case being investigated on national territory, in which a company administrator is suspected of having issued false fiscal documents to reduce a company's payment obligations. The damage calculated in the case amounts to approximately €59,300, of which the evaded value-added tax would represent approximately €36,100.
The Court of Appeal in Oradea decided in March 2024 that the facts had expired. Prosecutors challenged the decision, and the Supreme Court referred the matter to the Luxembourg court for clarification.
European judges established that, when domestic legislation does not provide for a distinct threshold, fraud is automatically classified as "serious" if the total value exceeds €50,000. This applies regardless of whether the actual damage suffered by the Union's budget is less than this sum.
Concerning the application of more favourable criminal law, the European court clarified that national rules in this matter are not, in principle, contrary to community law. However, they cannot be used in cases of serious fraud against European financial interests when they create or amplify a systemic risk that such offences remain unpunished.
Regarding the Supreme Court's position from 2024, according to which judges could not eliminate the application of an earlier decision without violating the principle of legality and the prohibition on creating a "third law", judges at the CJEU considered that this approach does not comply with Union rules.
At the same time, the European court emphasised that the first "Lin" decision does not require Romanian judges to combine provisions from successive legislative acts to create a hybrid criminal regime. Therefore, the constitutional prohibition on "lex tertia" remains valid, but cannot be invoked to justify non-application of the obligations imposed by European law.
The CJEU further established that final judgements in which statute of limitations has already been found cannot be reopened. A judgment contested through a cassation appeal does not, in principle, benefit from the same protection of the authority of res judicata.
The European court did not directly resolve the criminal case in Romania. The Supreme Court will have to deliver the final ruling in the concrete case, respecting the binding interpretation provided by the judges in Luxembourg.
Source: Digi24