Committee on Budgetary Control Joint meeting Committee on the Internal Market and Consumer Protection Subcommittee on Tax Matters HEARING Joint Public Hearing on Countering VAT and customs fraud for the protection of the Union’s financial interests
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CONT, IMCO, FISC European Parliament
Marie Lamensch
ViDA will introduce digital reporting based on electronic invoicing for intra-EU transactions. In addition, Council Regulation was adopted on 10 July 2024, amending Regulation 904/2010 to give EPPO and OLAF more direct and targeted access to VAT information held at the Union level, including key data on cross-border transactions, and to reinforce the transmission of relevant Eurofisc analysis. This is a significant step away from slow, fragmented bilateral requests towards faster cooperation between tax administrations and EU investigative bodies. These developments matter because carousel fraud moves faster than traditional requests for information.
But this is precisely where we must distinguish two different anti-fraud strategies. The first is detection and prosecution, and this is the area in which the Union has made the most visible progress. It includes data sharing, risk analysis, artificial intelligence, audits, investigation, prosecution, and recovery. These tools are indispensable; no system can eliminate fraud entirely, and determined criminal networks will always adapt. But the second strategy, and the one that should come first in the design of the system, is prevention.
Prevention means examining the rules themselves, designing them so that fraud is structurally impossible, or at least substantially more difficult and less profitable. It asks not only how to identify a fraudulent transaction, but why the legal and administrative system permits the fraud opportunity to arise in the first place. Detection and prosecution are by definition the cure; they intervene when the vulnerability already exists, and frequently after the revenue has already been lost.
In my view, the current debate focuses too heavily on the cure. We discuss obtaining more data, exchanging faster, and improving cooperation between Eurofisc, OLAF, and EPPO, Europol, Eurojust, and national authorities. These are necessary measures. Yet, they largely assume that the underlying opportunities for fraud will remain in place. This is a significant gap.
In revenue, I mean, prevention is not simply desirable, it is indispensable. Given the scale of the fraud, the amounts at stake, recovery is often close to illusory. Criminal networks use disposable companies, they organize insolvency, they move funds rapidly, fragment transactions across transactions across jurisdictions, and operate partly outside the Union's reach. By the time the fraud is detected, the money has frequently disappeared. Even successful investigation and prosecutions may therefore come too late to protect the Union's financial interest.
Stopping an ongoing fraud is necessary, but it is not enough.
Chasing the money afterwards cannot be the strategy. The European Court of Auditors special report the latest August 2025 concluded again that the Union's financial interests are insufficiently protected and identified gaps in the rules. Weak member state controls, shortcoming in cooperation, abuse of customs procedure 42, and the IOSS is not detected effectively. Sanctions vary significantly and VAT and customs identifiers are not consistently linked. Some of these weaknesses require better detection.
But others require changes to the architecture of the rules. For customs procedure 42, the question is not only whether authorities exchange information quickly enough after an exempt import. It is also whether the exemption can be designed around reliable evidence of the subsequent movement and robust identification of the parties. The same lesson applies more broadly to carousel fraud. If a fraud pattern persists for decades despite audits, investigation and prosecution, we should not conclude only that enforcement must improve.
We should also ask whether the rules themselves continue to create a repeatable and scalable opportunity for organized crime. This may require a more fundamental re-evaluation of certain VAT and customs mechanism.
And that is always institutionally and politically difficult. But if the alternative is to accept recurring loss of a very large of very large amounts and then try to recover them from shell companies after the event, the real question is whether we really have a choice. The anti-fraud architecture revision should therefore give equal weight to prevention and enforcement and I would suggest four priorities. First, establish a genuine fraud-proofing discipline for EU legislation. Before simplifications, exemptions or new reporting systems are adopted, they should be tested against known fraud models.
Existing rules that generate persistence large-scale fraud should be reviewed not only for better enforcement, but for structural redesign.
The objective should be to remove the opportunity where possible, rather than continuously monitor it. Second, we should be prepared to reconsider more daring structural approaches where incremental reform is no longer sufficient. The Union has a natural tendency to improve existing systems step-by-step, and incremental change is often prudent. But there are moments where effective prevention requires the courage to revisit basic foundations. In VAT, ideas such as virtual VAT currency throughout the B2B chain, split payment, reverse charge mechanism, are certainly not without their own difficulties.
They raise various questions of cash flow, neutrality, administrative complexity and technical feasibility. Yet, they should in my view be reconsidered, among others, in light of current technology. At the end of the day, we cannot simply continue to lose billions of euro every year to VAT and customs fraud, and treat that loss as an unavoidable cost of the system. Third, where prevention cannot eliminate the risk, continue to connect the systems and convert information into rapid joint action. VAT, customs, payment and law enforcement data should be interoperable where legally permitted, with common identifiers, clear access rights, auditable searches and strong data protection safeguards.
A high-risk alert should lead to coordinated administrative and criminal action, and not simply to another exchange of information.
Fourth, measure success differently. The number of reports exchanged, of alerts generated, investigations opened, and prosecutions completed is important. But it does not by itself show that the system has become more resistant to fraud. We should also measure how quickly losses are stopped, whether fraud opportunities have been removed, whether assets are secured, and most importantly, whether criminal networks are disrupted. Before closing, I would like to stress one final point.
In recent months and years, efforts to improve detection have often been accompanied by additional reporting and compliance obligations for taxpayers. That may sometimes be necessary, but it cannot become the default response to every fraud problem. The Union must continue to protect the achievement of the single market, support legitimate trade, respect procedural rights, and keep compliance obligations proportionate. Digital reporting and e-invoicing should therefore be assessed not by the volume of data that they generate, but by whether they actually reduce fraud.
And here we should remain realistic. Organized crime networks are often perfectly capable of producing e-invoicing, filing forms, and creating the appearance of compliance. Formal compliance by itself does not prevent fraud. Detection may become quicker, but will it be quick enough? Perhaps not, and in fact, perhaps far from it.
Pasquale Tridico
You could say more during the answer. You could say more during the answer.
Marie Lamensch
Of course. Can I say one sentence? Okay. In conclusion, the best anti-fraud architecture is not the one that catches the most fraudsters, it is the one that leaves organized crime with fewer opportunities to commit fraud in the first place. Thank you very much and my apologies for being longer than expected.
Pasquale Tridico
Thank you. Yeah. Now I will give the floor to Mr. Pablo Tedo Murua. I kindly ask you to stay within the time and you can consider the fact that during the answer you will have more time even to elaborate better your speech. Professor Pablo Tedo Murua, the floor is yours.
Seven minutes, please.
Pablo Tedo Murúa
Thank you very much for inviting OLAF, the European Anti-Fraud Office, to this hearing.
The European Union is an open market, a rules-based community and a union of law. Its strength lies in the single market, in the free circulation of goods, in interconnected supply chains and the trust in the common rules are applied fairly across all Member States. But the very features that make our EU economically powerful also make it vulnerable. For decades, customs enforcement in Europe was built around a trade facilitation model where legitimate trade was subject to limited, nationally-based controls on identified risks. This paradigm is changing due to global overcapacity, intense price competition, booming of e-commerce and increasingly sophisticated criminal methods.
Organised crime networks exploit the openness, scale and complexity of the single market to commit customs fraud, evade VAT, circumvent trade defence measures, irregularly introduce illegal goods and undermine fair competition. They move across jurisdictions faster than many control systems can follow.
They use shell companies, straw directors, false invoices, freight forwarders, warehouses, bank accounts, online platforms, not for one isolated infringement attempt, but as part of an integrated fraud model. Fraudsters are no longer merely trying to avoid a duty or a VAT payment. The same infrastructure can be reused across multiple offenses. The same consignors, the same logistic chains, and the same front companies can support all of them simultaneously. This is why enforcement response must be equally integrated, European, and determined.
OLAF plays a crucial role in that effort. OLAF detects cross-border patterns that national authorities acting alone may not easily see. Following the adoption of the legislation of access to VAT information, we are going to take a further step forward. OLAF cooperates closely with Member States' customs and tax authorities, we send early warnings to Eurofisc, and we support EPPO where criminal action is required. And with millions of consignments entering the Union, especially through e-commerce, a strategy based only on increasing physical checks at national level will never be sufficient.
We need better detection and a more integrated approach. We need EU-wide visibility, access to relevant customs, VAT, and commercial data, and the ability to connect and analyze those data and collect relevant information and documents across the single market. Criminal organizations exploit asymmetry.
They operate in one integrated economic space, while detection, control and investigation often remains fragmented along national lines. We cannot allow that asymmetry to continue. This means even closer cooperation between OLAF, EPPO, Europol, the future EU Customs Authority and national customs and tax authorities. It means coordinating and combining administrative and criminal tools more effectively and always having the EU perspective. We hope the upcoming revision of the EU anti-fraud architecture, combined with the amendment of OLAF and EPPO regulations and the PIF Directive, and also the VAT reform, the ViDA package and the customs reform, will strengthen the EU response.
Let me put some concrete examples of why all this matters. One is transit fraud, which has developed into a multi-million euro scheme increasingly exploited by organized crime. It is used to introduce irregularly goods into the EU market, particularly textiles, electric bicycles, illicit and highly taxed goods. The consequences are serious: evasion of duties, loss of revenue, safety concerns and severe distortion of competition for compliant businesses.
OLAF and EPPO have therefore launched coordinated action to combine the EU's administrative and criminal investigative capacities. But the central challenge remains the same: reconstructing fraudulent trade flows across the Union when customs data and control strategies remain fragmented and visibility is divided. A second example concerns low-value e-commerce consignments. Following the introduction in July of the three euro duty on such consignments, the market has reacted rapidly. Reportedly, the number of declared e-commerce parcels fell by around 50% in the first two months of application.
Although this may reflect legitimate restructuring of trade flows, it also shows how quickly global operators can adapt their logistics and compliance models to new conditions of access to the EU market. And this agility creates risks. It may open the door to artificial routing, manipulation of consignment structures, undervaluation or other practices that circumvent the new charge and related customs obligations. To distinguish lawful optimization from unlawful circumvention, we need to see the whole trade flow, not just isolated border events. A fragmented national response will inevitably leave gaps.
A coordinated EU-level approach is therefore essential. A third example relates to the trade diversion to avoid EU trade defense measures. Here too, supply chains can be reorganized quickly.
Assembly or processing might be shifted to third countries, while a substantial share of the components, technology and value added might still originate in the country against which the measures are adopted. Such restructuring is not automatically unlawful. The issue is whether there is genuine production and substantial transformation or whether the measures are being circumvented and the economic reality of the supply chain disguised. Fraudulent mechanisms can support disguising the reality of operations in third countries. This matters if trade defense measures can be neutralized by artificial rerouting or insufficient transformation, then their protective effect is undermined.
European producers are exposed to unfair competition and the credibility of the EU's trade policy is weakened. OLAF has for many years actively supported enforcement by conducting verifications in third countries in partnership with local authorities to establish the true origin, transformation and value chain of the goods concerned. Once again, pure national enforcement and fragmented approaches cannot be the response. Goods may enter through any external border and then circulate freely throughout the Union. The recent development in sectors like electric cars calls for adapting the measures and the legal instruments permanently based on the operational experience gained.
If we want credible trade policy, we must enforce it as one single market. This is a ultimate question of sovereignty, fairness and trust.
Organized crime has already adapted to the realities of an integrated European economy. European enforcement must now do the same. Thank you very much.
Pasquale Tridico
Thank you very much, Mr. Pablo Tedo Murua, for being so well in the time, very interesting. Now we give the floor to Mr. Clement Oven.
Klemen Oven
Honorable members, chairman of the FISC subcommittee, thank you for the invitation to speak in this panel. I will focus my intervention on the aspects of detection of irregularities and fraud in customs and taxation area. I will cover the tools, cooperation frameworks, and challenges under the existing legislative framework. First, customs plays obviously a very important role here, acting as a first line of defense, detecting fraud through its constant presence at the external borders. Customs collects the data of goods moving into the customs territory, deploys data analysis, risk management, controls, and inspections before the goods enter the internal market and move freely within it.
And on the taxation side, the authorities act similarly within the internal market. So if I can begin with, let me lay down some examples how the criminal landscape with their actors and fraudsters in general target the weaknesses of the customs and taxation supervision framework. In the customs domain, their tactics employ a combination of well-known conventional techniques such as misdeclaration of the goods classification or of origin, and combining with the use of various complex cross-border schemes, like for example combining several transit procedures with customs and tax suspension regime, including the customs warehouses and free zones. Often this is combined with forged documentation, which is becoming especially an area of concern in the world of the artificial intelligence tools.
Identity theft of e-commerce operators benefiting from special VAT import one-stop shop delayed payment, and also identity theft of the economic operators identifications, which is in the area of customs, is also very much present in the criminal sort of schemes and being evidenced. Further, specifically as concerned VAT fraud, the missing trader for intra-community movements is a constant criminal practice, including so-called carousel fraud. In these cases, criminal networks establish chains of companies across the Member States. Fraudsters exploit the VAT rules for cross-border transactions and use companies that disappear before paying the VAT due. Because these schemes operate across several countries and move quickly, they are difficult to detect and stop, while recovery of the unpaid VAT can also be challenging.
The problem is not limited to traditional business-to-business fraud. As the previous speakers, e-commerce has created new opportunities and new fraud patterns. Fraudsters can operate remotely, rapidly change identities and structures, use intermediaries established in different jurisdictions, and exploit the very high volume of low-value transactions.
Overall, the aim of the criminal actors is to take advantage of fragmented customs and taxation data environments within and across the Member States and of massive numbers of transactions and economic operators that authorities need to deal with. To give an indication of the scale of the problem, the EU VAT compliance gap was estimated at 121 billion euros in 2023. This of course is not an estimate of fraud alone, as it also includes other forms of non-compliance. More specifically, missing trader intra-community fraud is estimated to cost between 12 and a half billion up to 32.8 billion euros every year. In the customs domain, national customs authorities obviously already counter fraud in the current legislative framework.
In 2025, the total amount of reported unpaid customs duties was equal to 824 million euros, of which Member States reported of 85 million fraudulent amounts. So the share of detected unpaid duties compared to the total gross amount of collected traditional own resources was 2.6% higher than in 2025, so higher as in previous years. So what has been the answer in keeping up with the pace of the challenges within the existing regulatory framework, which has evolved in time?
On the VAT value tax side, the EU legislation has progressively strengthened the tools available to tax administrations. VAT information exchange system, Eurofisc, one stop shop and import one stop shop, customs information and more recently payment information available through central electronic system, CESOP, provide tax authorities with more information than ever. Eurofisc is a concrete example of how cooperation under the existing framework works in practice. It is a network which brings together national anti-fraud experts to exchange information, jointly analyze cross-border transaction and coordinate follow-up actions. Since 2019, Eurofisc has been supported by the transnational transaction network analysis tool, which allow VAT information to be exchanged and jointly processed more rapidly among the authorities.
In 2024, the Eurofisc identified more than 6,000 fraudsters and uncovered 13.8 billions in fraudulent or suspicious transactions. Also cooperation between the tax and customs authorities is another important part of the existing framework. Already mentioned procedure 42 provides a good example.
It concerns importation of goods where goods are released in one member state without paying the VAT, which is delayed and payment made in the country of final destination of goods. Customs authorities can now check VAT identification numbers through the VIES at the moment of importation, while relevant information is made available. On the other side, Eurofisc has the access to the procedure 42 customs data to also verify on their end the potential fraud on the VAT. On e-commerce also CESOP adds another important source of information by providing the payment data on cross-border transactions. Further in the customs area, the authorities are connected for secure sharing of risk information via the central system, Customs Risk Management System, and in year 2025, the customs alerted each other on 400 cases of irregularities and new modus operandi used by fraudsters.
These initiatives are conducted within of course within the constraints of the existing legislation and existing systems. The customs as an example, the customs where the data is still stored in 111 different national environments, where under the current legal basis the Member States share only data with each other and with the Commission on a voluntary basis for the purposes of risk management and combating fraud, and they are not required under the current framework of the Union Customs Code, which of course is being addressed by the customs reform. So to conclude with the challenges, although the EU already has a relatively strong framework for VAT administrative cooperation and a growing range of tools to support controls, the challenge is to ensure that these tools are used effectively and consistently in practice across the EU. On the customs side, the challenge is greater since under the current legal framework relevant data is collected nationally, data necessary for the entire customs supervision chain is fragmented in various systems and the sharing of the data and cooperation among customs authorities in terms of data analysis to detect risky transactions and economic operators is still based on a voluntary level. Thank you very much.
Pasquale Tridico
Thank you very much, Mr. Oven. And now give the floor to members starting with Mr. De la Hoz Quintano. Please, the floor is yours up to one minute.
Raúl de la Hoz Quintano
Okay, thank you very much, I will be speaking in Spanish. Me gustaría hacer una pregunta al representante de la Comisión sobre el port shopping.
El port shopping es un fenómeno que ilustra perfectamente cómo el crimen organizado explota las debilidades del mercado único europeo. Simplemente las redes criminales buscan el puerto con controles menos rigurosos, infravaloran o clasifican falsamente las mercancías y abusan de los mecanismos como el régimen aduanero 42 para eludir posteriormente el IVA. Una vez que los productos han sido despachados pueden circular libremente por toda la Unión. Lo que vemos es que las diferencias nacionales se convierten en una ventaja competitiva para los delincuentes y en una penalización para los puertos, para los países, para las agencias de control que trabajan perfectamente y correctamente. La respuesta desde nuestro punto de vista no puede ser invitar a los puertos a que apliquen correctamente las normas para que dejen de hacerlo.
La respuesta debe de ser, entre otras, adoptar medidas para que, por ejemplo, una mercancía que ha sido rechazada en un Estado no pueda entrar en otro. Por eso le pregunto a la Comisión, en el ámbito de la revisión de la arquitectura antifraude, ¿tiene previsto la Comisión introducir cambios concretos para reducir esas diferencias de control existentes entre los puertos?
¿Tiene previsto introducir cambios concretos para garantizar unas condiciones de competencia equitativas en el mercado único? Y si, por último, si tiene previsto conseguir que la protección de los intereses financieros de la Unión no dependa en ningún caso del puerto por el que se introduzcan las mercancías. Nada más y muchas gracias.
Klemen Oven
Ah, yes. Apparently I was volunteering not switching off the mic before. So, the diagnosis is correct. The, in particular, the fragmentation of the national information systems in the area of customs creates the opportunities for the fraudsters, criminal organizations to engage into the port shopping, whereas the honorable member explained the modus operandi. Partially this phenomena is being addressed today.
I mentioned the secure system of risk management or risk information exchange that Commission has deployed centrally and is operated over the for 20 years and where in a example that I gave, the member states have been sharing the cases of trying to circumvent the rules and to commit irregularities affecting the financial interest in 400 cases. Whether this is sufficient, whether this instrument and the I would say structure architecture is sufficient, we say no, obviously. The fragmentation and the opportunities for the criminals are too vast and exploitable. And for the reason for this reason, of course, it's very important to look into the proposed customs reform and the establishment of one unified central system where the all trade transactions, vis-à-vis wherever they come the goods come in, will be collected and reported to the EU one single unified European customs data hub, which will allow the future newly established EU customs authority to conduct the EU level risk management and to signal on potential attempts of the port shopping the member states of entry and to take the appropriate action. So we see in the context of reform these changes will be substantial.
Thank you.
Pasquale Tridico
Thank you very much, Mr. Owen. Now the floor is to Madame Grapini, please.
Maria Grapini
Mulțumesc mult, voi vorbi în limba română. În primul rând vreau să mulțumesc pentru că cei trei vorbitori de fapt ne-au prezentat situația pe care eu cred că noi o știm. Situația de evaziune și tot ce se întâmplă în piața internă o cunoaștem. Eu cel puțin sunt de trei mandate aici și în comisia CONT și am fost raportor la vamă și în comisia piața internă. Ce m-ar fi interesat pe mine, aș fi vrut mai multe soluții pentru că doamna profesor ați prezentat că nu e suficient să cheltuim bani prin instituțiile care le avem pentru a identifica să zicem, ci mai mult pentru prevenție.
Și atunci întreb: ce propuneți pentru prevenție? În al doilea rând, nu considerați că sancțiunile sunt prea mici? Eu vin din mediul privat. Dacă un întreprinzător, o companie câștigă mai mult prin fraude și evaziune decât este sancțiunea când îl prinde, va continua. Nu-l interesează că plătește o sancțiune și continuă să facă fraudă.
Ori bine ați spus aici, este pe lângă pierderea la bugetul european, bugetele naționale, este și o competiție neloială pentru cei corecți.
Și dacă nu o să reușim să identificăm, probabil vom crește pe cei incorecți și mor cei corecți. Și ultima întrebare, dacă dumneavoastră considerați că noul regulament vamal și cu noua autoritate prima autoritate înființată va influența pozitiv ceea ce vrem noi acum să eliminăm și anume frauda.
Pasquale Tridico
Thank you. Mr. Pablo Tedo-Muruá, would you like to answer please? And then I will give the floor to Professor Lemaistre.
Pablo Tedo Murúa
Thank you, Chair. So we cannot concur more with what has been said in the speech by Professor Lemaistre about the need to balance both enforcement but also prevention. So then there are various aspects of prevention that need to be improved. So we need to fraud-proof the legislation and whenever we do a simplification, balance against the opportunities that it creates in terms of fraud, the fraud enablers. As the honorable member is saying, it's also important the corrective action.
So whenever we are able to detect fraud, so we need to apply sanctions, so by administrative means and by means of prosecution.
But we cannot allow the same operators to continue doing the same practices without any measure against them. So in this respect, so the now we have ongoing a VAT ViDA package to be implemented and a customs reform. So we'll have to calibrate when those legal acts are into force how much is needed. But from our side in OLAF, based on our operational experience and based on what we discover every day, we will continue reporting the loopholes that we observe in the in the Customs Union and the VAT single market so that they can be fixed at the earliest opportunity.
Marie Lamensch
Yes, so looking for solutions, then perhaps rather illustration of what I mean by changing the design, because I cannot propose a single model for immediate application that will cover all the flaws that are problematic in the EU.
But if you take e-commerce for example that has been mentioned several times, we see up, so e-commerce and IOSS, we have payment information that needs to be reported by financial intermediaries on a quarterly basis, so we can detect when there is a huge gap between what has been paid to the EU and what should have been paid to the EU. The problem in the meantime is that the money has gone and me, as a European resident, if I buy online from let's say a Chinese company, I pay Belgian VAT because I'm a Belgian resident to a Chinese operator who is kindly invited to get an IOSS registration and to remit that amount. I think from a structural perspective it works well on paper, but this is counter-intuitive to say it politely that we say yes, but don't worry, we're going to have payment information at the end of the quarter and if that trader should have paid VAT on your purchase, we know it. Because by the time you know you have that information, the company has changed names five times. So that's what I mean by structural design, sometimes, and again this is very specific to e-commerce and to importation in particular, but the design of the IOSS, it has many advantages in terms of compliance for compliant operators and still it can be a bit annoying to have this registration.
But for fraudsters, we need to do something about the very design so that when I pay VAT to a supplier, it does not leave my country, it stays in the country of taxation.
Pasquale Tridico
Thank you, Professor Lamensch. We need to remember as well when we speak about simplification, 50 billions euro of fraud per year is something. Now we go to Madame Joxan. Please, the floor is yours.
Virginie Joron
Merci. Merci, Monsieur le Président. Je remercie aussi également les représentants et j'ai ma question aussi pour la DG TAXUD. Alors, on parle beaucoup aujourd'hui de la réforme douanière qui doit être votée notamment la semaine prochaine à Strasbourg. Le Conseil a de son côté déjà donné son aval la semaine dernière.
Cette réforme prévoit notamment la mise en place de frais de gestion dont le montant doit être fixé par la Commission européenne d'ici le mois de novembre 2026.
La philosophie générale de cette réforme, c'était évidemment de donner davantage de moyens aux douanes pour contrôler les flux, mais aussi autant que possible de réduire l'explosion des petits colis issus du commerce électronique, on vient d'en parler, notamment provenance de Chine. On parle de 5,9 milliards de colis en 2025, ce qui donne quand même une idée de l'ampleur du phénomène, vous le savez tous, et depuis le 1er juillet de cette année, des droits de douane de 3 euros sont par ailleurs appliqués sur ces petits colis. À la fin du mois d'août, le ministre français de l'économie Roland Lescure expliquait qu'on pouvait déjà observer au niveau européen une baisse des importations de l'ordre de 30 à 40 % depuis le 1er juillet. Plusieurs spécialistes ont depuis remis en question ce chiffre. Et pour être tout à fait honnête, sur le terrain, j'ai moi-même constaté que ces colis continuaient d'arriver même au mois d'août et toujours aussi rapidement.
Donc ma question est assez simple, est-ce que la Commission peut nous confirmer aujourd'hui ce chiffre qu'a annoncé Monsieur Lescure de baisse des importations depuis le 1er juillet ? Et si ce chiffre n'est pas confirmé, dispose-t-elle déjà de données permettant de mesurer l'effet réel des nouveaux droits de douane sur les importations de petits colis ? Je vous remercie. Je ne sais pas si j'aurai après une minute de plus pour la facture électronique parce que c'est aussi un sujet à venir qui intéresse beaucoup aussi l'industrie. Merci.
Pasquale Tridico
Thank you, Madame Sharon, and excuse me for misspelling your name before. Mr. Owen, would you like to answer please?
Klemen Oven
Thank you very much, honorable member, for the question.
Yes, we basically could, can, in general, confirm that there was a substantial reduction of the low-value consignments inflow as from July 1st when the three-euro duty has been established. Our services in DG TAXUD are collecting the data from the member states as part of a surveillance system which collects all the information from the import declarations and import declarations for low-value consignments. And we do see a decrease. The exact numbers across the European Union or decrease per member states, of course, can be assessed. We have tools and we have the data.
At this moment, I do not operate exactly with these figures, so we certainly can get back to the honorable member and to the committee once we can provide a verifiable and validated information. Thank you.
Pasquale Tridico
Thank you, Mr. Owen. And now we give the floor to Mr. Eriksson, please.
Dick Erixon
Thank you, Chair. For the anti-fraud architecture review, the real issue is not simply collecting more data, but connecting it early enough to act. So I have two questions.
Should OLAF and EPPO receive automatic risk-based access to the custom data hub and database? And who should be responsible for turning a cross-system warning into an investigation before the revenue is lost? Thank you.
Pablo Tedo Murúa
Thank you, Chair. So on the question of the access to the hub, so this is already regulated. So it's foreseen on the customs reform. So there is access to be granted and then the conditions are going to be further discussed when the implementation rules of the customs code. On the question of passing a EU risk alert into an investigation, so this is an issue which indeed it is crucial.
And this is why in OLAF we had the strategy over the last years to move from investigations that go back to many years ago and then to establish what had happened and so on, so to act almost real-time on the cases.
So this is absolutely crucial. And then we also have the strategy to, if necessary, involve the EPPO in case of criminality also at an early stage so that coordinated and combined action at administrative and criminal level can be handled to address the issue when they are alive, when the traffic is moving and we have persons, operators, etc., not when everything is gone. Thank you.
Daniel Freund
Thanks, Chair, and thanks to the guests for the expertise. I want to ask about the data access as well, both to the Commission and to OLAF. So you said it, new rules say that you have access or should soon have access to VAT data, to the customs data hub, I think also to the Taxud systems to some extent. Can you say how operational this is now? I'm over here.
Hello. Is this operational now? And do you actually have both the technical and the personnel to deal with all this data? Is this really improving now your work?
Where are we on making use of all these new data accesses that you have? Thank you.
Pasquale Tridico
Thank you. So I would like both OLAF and Commission to answer this, please. Mr. Pablo Tedo Murua, please.
Pablo Tedo Murúa
Yes, so the access to the hub and the new VAT data which kindly the Parliament and the Council granted us is not yet operational. So I think there is a long way until this is operational. It requires a lot of technical work before this is operational. So for the time being, we work with what we have, which is the former access, which in the case of OLAF is access to surveillance data, which is a simplified version of the import records. And we try to maximize, maximize the use of it because at least, at least we have an European perspective.
But we are in the hands of good cooperation with customs authorities of Member States.
On VAT data at the moment we are literally blind, but we have reinforced a lot our cooperation with Eurofisc. So this is moving in the right direction. And with EPPO, as indicated, we are exploring ways to act as soon as possible in order to address the matters at the right time.
Klemen Oven
Mr. Oven. Just a bit to complement the previous speaker from OLAF, when it comes to the access of OLAF and EPPO to the taxation VAT data, the access to the VIES, so VAT Information Exchange System, CESOP and Procedure 42 will is planned to be implemented in August 2027. When it comes to the EU Customs Data Hub data, it will be available once the EU Customs Data Hub will be established and will start collecting the data, and we will cover that in the next panel.
When it comes to the existing customs systems or TAXUD systems and access by OLAF to those systems, most of the data or many data is already being accessible under the provisions of the Regulation 515. But certainly there are certain additional data sets or systems to which OLAF should and will have access to on the basis of a new Union Customs Code provisions. Of course, we will in the further discussions between the Commission services, DG TAXUD and OLAF, in terms of how to technically arrange this implementation. And yeah, that would be I think covering those questions. Thank you.
Pasquale Tridico
Thank you. And now the very, very, very last question by Mr. Goting, please.
Dirk Gotink
Thank you, Chair, for your flexibility. What I fail to understand and have failed to understand during the time that we were working very hard on the Customs Code is that the sense of urgency around this topic is simply not very high. It became high because of e-commerce. But criminals were stealing tens of billions of euros every year from researchers, farmers, Erasmus students. I mean, they were stealing from the European budget.
And everyone that talks about a single market needs to explain me again how a single market work in 27 different IT environments with almost 200 different IT customs systems throughout the EU that do not communicate with each other.
Now, you would think that criminal organizations are the only ones with a vested interest to protect that fragmentation because they earn a lot of money with it. But member states are fighting very hard to maintain that fragmentation. We had to fight in the negotiations hours to integrate the data hub, to not have national flags on datasets. And still in the implementation, I would insist for DG TAXUD to really fight hard to follow the law because member states will want to keep their national compartments inside the data hub. It's absolutely essential.
And just for the record, member states wanted the obligatory use of the data hub in 2037. So not even in the next mandate of the European Parliament, but the one after that. And that's the urgency that we are dealing with. So in that sense, from the experts, thank you very much. It's all, I've heard a lot of it, but in the implementation, we still have a lot of attention to give to push back this national reflex and also to build the capacities what my colleague Freund was talking about because we've been cutting down on experts, on customs experts, on financial experts in member states for decades.
And we don't have a financial solution to start building that again. And that is my most biggest frustration is that we cannot use the three euros that is very successful to finance customs and these kind of fraud anti-fraud operations. Thank you very much.
Pasquale Tridico
Thank you. Thanks Gott. I was giving you the floor for this very, very, very last and interesting question. I will give you now one minute each to all our distinguished speakers, starting from Professor Lamensch to make an address to the question of Mr. Goting and in keeping it short, please.
Marie Lamensch
Well, on the sense of urgency, of course we all share that frustration, but again I would repeat that stopping fraud is one thing, preventing fraud should be the the real priority and changing the rules also takes time because you have the whole democratic process and unanimity requirement. So I really believe that if you have a rule that persistently generate large scale fraud, you should not just work hard at improving enforcement. You should think about architecture and this is for me the utmost priority.
Pablo Tedo Murúa
Yes, on the issue of the capacities, so because the data is fragmented and we don't have visibility, so we try to maximize what we have. And with this we discover what we consider are big fraud, but maybe it's only the top of the iceberg because we don't have the complete picture. So yeah, so we need to seriously consider about the resources that we invest and also to allow the instruments that generate the possibility to see what's going on, to have the complete picture. Because then we will assess, because this is a dangerous circle. If because we don't have the tools or the visibility we don't discover fraud, then we proclaim that there is no problem and then we go on.
So yeah, I raise the attention to that point because for me it's essential. And in our team we work with a team of 20 EU investigators for customs, which seems a reasonable figure, but not to the dimension and the challenge that we have in front of us. Thank you.
Klemen Oven
I would just maybe reply to the sense of urgency and obviously to thank to the Parliament that the timeline that was initially discussed of 2037 as mentioned has been pushed to earlier period, 2034 for the mandatory use of the data hub, but of course also that the law will foresee, foresees that the data hub will have to have all the functionalities for the operators to start using it already by 2032. So we are here in 2026 and completely basically replacing 100 systems which support the entire customs supervision chain of all the international goods movements in this amount, period of time is going to be massive challenge for the Commission, for the EUCA and for the Member States. And it will not go without the risks. So it's going to, it is even though that is very technical change in a way to change the systems, etc., it will have to be developed in a very careful and in a very, you know, robust manner because any mistake in the supervision can actually open up the doors to the criminal organization if we look just from the perspective of, of the issue of the crime abusing the single market.
So we are staying ambitious from the Commission DG TAXUD point of view and and there is no question about the fragmentation or compartmentalization. Member states have been politically all basically behind the data hub and this result will be soon also in adopted regulation. Thank you.
Pasquale Tridico
Thank you. Thank you very much to all our speaker, to the members for the very interesting questions and for the debate which was actually very, very interesting. Now I will give you the floor, Anna, the chair of IMCO, Madame Cavazzini, for the second session to be chaired. Thank you very much.
Anna Cavazzini
Grazie. Thank you so much. Also from my side, welcome. Extremely happy that we do this important hearing together, also the three committees together. I think it's one of the first time in this combination to talk about the topics that it should be a no-brainer, right?
I mean, is so important for the EU budget and yet at the end to implement so difficult. So I'm so happy that we have all the distinguished experts here that we can assess how far we went already because looking at Dirk and also at Maria, we negotiated the reforms of the Customs Code and of course it's a huge step forward, but there's much more to do.
So looking forward to the second panel. We have not so much time unfortunately for the second panel, so sorry already that I will have to cut the experts a little bit short. We start with also a well-known guest actually in our committee with Frank Heijmann, Customs Council at the Permanent Representation of the Kingdom of the Netherlands to the EU. And each of you has seven minutes sharp. Thank you.
Frank Heijmann
Yes, thank you very much. I thought I had a few slides. Do you have them available? If not, it's not a problem. No slides, then I'll continue without slides, no problem.
First of all, I would like to thank you very much for inviting me to share our views on this matter for your committees. Considering what's just been said, it's important to say customs apply and enforce the law and they don't make it. The insights that I will share are based on the experiences and the practices of the Netherlands Customs Administration.
And I will take a brief look into the future, a bit to what is just referred to on the EU customs reform. The Netherlands Customs Administration handles about one third of the EU external trade. And it was already said, customs is the first line of defense. EU-wide, more than 600 million declarations for business-to-business imports are processed every year. And last year, it was already said, almost 6 billion business-to-consumer imports were handled.
This equates to around 210 clearances per second in the EU. Looking at the financial aspects, customs duties are collected to the amount of around 30 billion euros per year. However, when we look at the total import duty burden on the total trade flow, then import duties cover for only about 1% of its value. So it's a complete different dynamics than looking at, for example, VAT, where the burden runs up to 21%. The majority of the trade flows are regular movements of goods that cross the EU's external borders and they are managed by legitimate traders.
Many of these goods are not subject to customs duties due to free trade agreements that allow for a reduced or zero-rate import duties. Also, many goods are imported by known traders whose trustworthiness is objectively assessed by customs. Customs expertise lies, as I said, in applying and enforcing the law. It lies in risk management. They analyze information to determine which goods come from where and who is transporting and importing them.
And they also check whether the available information is consistent. This is the day-to-day work of customs. However, the world around us is changing. Diverging trade flows and shifting international geopolitical and trade dynamics mean that customs processes must constantly be improved. The EU customs reform is the next step in strengthening customs enforcement.
And there's already the slide, can I have the next slide please? The establishment of the EU's Customs Agency, the EUCA in Lille, will support customs authorities in the EU to act more as one in the Union. The EUCA will facilitate the exchange of information between customs and other authorities and assist the customs authorities with risk management. You see it here on the slide, the EUCA will manage the EU Customs Data Hub. This will be a highly advanced technological system that will consolidate data from traders, customs authorities and other relevant bodies, and this will enable a more effective risk analysis and data sharing across the EU, as it was already said, now this is running in over 100 different systems in the 27 Member States and running with the European Commission.
Next slide, please. The risk management process involves collecting and analyzing information from various sources. The information is provided by traders to fulfill their customs obligations, historical data on these traders from customs and other authorities are also taken into account. Customs also access publicly available sources. Customs analyze all information they deem necessary to detect risk.
Next slide. Then look at a risk, because there's often talked about what is a risk, and a risk is defined as the likelihood of something going wrong and its consequences. This means that not every possible mistake will be followed up in the control process. This enables customs to prioritize the risks while ensuring that legitimate trade flows smoothly and without unnecessary delays can go on. Next slide.
In future, this risk assessment will be carried out at different levels.
Where now is a single member state customs authority in the position to lead the job, in future the Commission, the European Customs Agency, and the customs authorities will play all their part. While risk EU while EU level risk management can identify where the risks are and control recommendations can be given by the European Customs Agency, it's the member states that remain responsible for deciding how to act on them. This may involve a scan, sample testing, laboratory analysis, an audit or a physical check. Customs in the member state on the ground are the best in place to determine which instrument is best in place. The follow-up and the outcome of any control recommendation by the agency will be reported in the EU Customs Data Hub and this will already be a mega change towards everything being collected only on a local level today.
The next slide, information sharing, the next step is to share the information with the other authorities. Was already discussed, access for other authorities has now been put in place in the EU customs reform. The EU Customs Data Hub will provide technical support to make this much more effective. This ensures that every relevant stakeholder receives the necessary information. Next slide, the customs authorities face a number of challenges in protecting the interest of the EU's internal market.
They enforce over 400 EU legal acts that apply on goods crossing the external borders. They cannot and do not need to check everything. The key is to use data and risk analysis to focus their resources on where the risks are the highest. With the upcoming implementation of the EU customs reform and the establishment of the agency and the EU customs data hub, we are confident that we can make customs fit for the future and enhance the customs union acting as one. But ultimately, as you can see on the picture, it always comes down to the experts in the field, about 80,000 customs officers all over the EU standing with their feet in the mud.
Thank you for your attention.
Anna Cavazzini
Thanks Frank for explaining us again the very, very important customs reform that is already having an effect actually with, for example, individual parcels going down by 30 to 40%. And thanks for sticking to the time, that's great. So now we have Mr. Andrea Venegoni, European Prosecutor at the European Public Prosecutor's Office, EPPO. So we talked already about EPPO today, welcome.
Andrea Venegoni
Thank you, thank you very much.
Honorable members of the European Parliament, ladies and gentlemen, first of all I would like to thank you for your invitation, I'm honored to be able to speak to you. My intervention stems largely from my practical experience in the EPPO where based on the number of the Italian cases I can say with certainty that I'm the European prosecutor dealing with the largest number of cases supervising EP and therefore I have a comprehensive view of all types of cases. The issue of recovery of the defrauded sum is essential also for the EPPO since the effective protection of the financial interests which the action of the EPPO seeks to achieve is obtained through recovery. Work of the EPPO proves that the proportion of the VAT gap that is caused by fraud is far bigger than we have assumed so far. The size of the VAT gap and its harmful effects on the economies of the member state is quite big.
In 2025 the EPPO investigated VAT fraud where the estimated value of the base was around 45 billion euros.
We have discovered a new continent of crime and the real issue, the elephant in the room we can say, is that the most dangerous organized crime groups are involved because it entails low risk, low social alarm and significant gain. They invest proceeds from their other criminal activities into VAT fraud and vice versa. EPPO's contribution to the recovery derives primarily from its investigative and prosecutory powers. I would like to address this topic from two different points of views: the execution of the final judgments and other modalities of recovery. From the first point of view, as a general rule, effective recovery takes the form of the execution of the final judgment in cases where the EPPO has seized sums as a precautionary measure in the course of the criminal investigation.
This part of our activity is highly labored. We ask judges to approve our freezing orders, responsible national authorities execute them, then we plead in court again, the judges decide on conviction and how much should be eventually confiscated by the responsible national authorities, and then national authorities have to confiscate and monetize the assets. All this takes years.
If EPPO would not freeze these assets during the proceedings, there would be much less to confiscate at the end. So in the EPPO investigations, we apply the following principles. We implement a proactive asset recovery approach from the outset, pursue the identification, tracing, seizure and confiscation of criminal proceeds, use disciplinary task force and involve relevant stakeholders, use all possible sources and channels to follow the trail of money. Thanks to our work, the EPPO obtained freezing orders only in 2022 of 1.13 billion euros. However, as regard the recovery of sums at the end of the criminal proceedings, EPPO's competence for recovery is not clearly defined in its regulation.
Thus, recovery remains uneven due to divergent procedures in the member states, especially in the VAT area. In the customs area, some systems prioritize administrative approaches, which can negatively impact asset preservation in criminal proceedings and cross-border recovery. In any event, enforcement of the judgment is normally left to the national authorities.
But sadly, practical experience shows that national authorities often do not have sufficient resources to deal with the execution of judgments. The European delegated prosecutors often urge national authorities to enforce the judgment, but only informally, with no official recognition of that role. The EPPO contributes to the recovery of EU funds also by other means, as a result of its investigative actions. These proceedings can include simplified prosecution procedures, issuing of compensation restitution orders, triggering administrative recovery actions, or providing essential information and recommendations to the administrative authorities. In the field of revenue, this is particularly the case in the customs area.
This is also the effect of some provisions of national legislation. In some states, including Italy, there are rules under which payment by the operator of full customs duties, together with interest and costs, on the criminal side has the effect of extinguishing the offense or rendering the perpetrator non-liable. This is a type of mechanism which, aside the assessment of compatibility with the PIF Directive, certainly has the advantage of ensuring a full recovery of the sums considered to be to have been defrauded.
But this mechanism escapes all the statistics. To conclude, ladies and gentlemen, on the revenue side of the EU budget, the effect of the EPPO investigation is much faster and financially highly impactful. However, to make this action even more effective, we need additional resources, more capacity and analytical powers for Europol dedicated to support the EPPO investigations, a strategic realignment of the relationship with other bodies such as Europol and OLAF, dedicated and specialized police, tax and customs investigators in support of the EPPO investigation, and a well-funded EPPO academy to train the best experts on best practices. Thank you for your attention.
Anna Cavazzini
Thank you so much for the overview of what EPPO is doing and also how you see possibilities to further improve and strengthen also your important work. We come now to the last speaker. I welcome Mr. Constantino Lanza, Deputy Head of Unit European Commission DG TAXUD. Welcome.
Constantino Lanza
Thank you, Chair, and good afternoon everyone. I think my presentation might be even shorter because we discussed already several topics.
And maybe let me start from, let me take over from the previous panel. There was a point that was mentioned by Ms. Lamèche that I like very much, which is the importance of working not only on anti-fraud measures, but also on making the system more fraud-proof. In the field of VAT, I must say that the Commission and also the Member States have tried across the years to make the VAT system more robust or less difficult to defraud. But this as such is a very difficult challenge. There are, so there is a Commission, there was a Commission proposal for the VAT definitive system that has never worked because there is a fundamental problem there.
So VAT after all is part, is part of the budget of the Member States, so it's a part of the national budget, and Member States must trust each other.
So that's why together with this work to make the the legislation more difficult to defraud, we are working on the so-called non-conventional measures or anti-fraud measures or measures to exchange better information. And our hope, and here I jump to the conclusion, is that by making cooperation between Member States and between different authorities working better and better, maybe we build this trust that we need between Member States to work later on on new rules to make the VAT system more fraud-proof and robust. So I jump to the conclusion, but here we are addressing the anti-fraud review approach that we are having now and we are discussing today. And the starting point is that we already have several pieces of legislation, so a lot has been done so far, we are not starting from zero. The problem is that we have a sectoral approach.
So we have a regulation for VAT administrative cooperation, we have the EPPO regulation, the OLAF regulation, the customs regulation and so and so. Now if you can still go back to the first slide please. This the the consequence is that we have many tools that work very well, but the cooperation between different anti-fraud actors is limited, let's say.
There is some cooperation, but it can be definitely improved. So there is the Eurofisc that we mentioned in the previous panel. They have a global view at European level of VAT information. They can coordinate administrative inquiries and administrative investigations into VAT fraud. But the other actors, they don't have the same view.
So if the EPPO and OLAF want to have the same information, they must exchange bilaterally with member states, and this slows down the whole process. This is just an example. So the new approach is to build on what we already have, what already exists, and to make it more efficient and more effective. So it's to eliminate redundancy. Try to... so here in this slide, there is only shared data, but it's not only that, because sharing data, as was mentioned in the previous panel, is just exchange of information.
What is important is also coordinating actions, because once different actors have access to the same data, then it becomes important to coordinate the actions and investigations, for instance, towards the same fraud network. Okay?
Okay, so the goal is to have a multidisciplinary approach where the different actors will use their powers and they will apply different sanctions, criminal or administrative sanctions. Then we can jump directly to the last slide, because I think that we discussed already quite enough about the customs reform and the role of the new customs authority. In the field of VAT, I said at the beginning that a lot has been done already. So we have this network of national anti-fraud experts, which is called Eurofisc, and this network is doing a lot. So every year they identify more than 6,000 fraudsters.
They manage to stop frauds for an amount of almost 40 billion euro a year. So this is quite impressive. We also have other tools. By 2030, we'll have the new VAT information system, which will be centralized, and we are moving toward a digital reporting requirement. So actually, currently, economic operators must report every month their intra-community supplies.
We are working on this digital reporting requirements that is not something that we invented in the European Commission.
This already exists in several Member States. And already this system helped Member States to cut drastically the VAT gap at national level. We have good examples like Hungary and Poland, for instance, that as they developed, implemented these digital reporting requirements, they really managed to get impressive results. So according to our estimates, at EU level this system will produce 11 billion, sorry, saving in terms of reducing VAT fraud a year. So this hopefully is also a quite impressive result.
And then we have this other electronic system that entered into force two years ago on payment information, that is more targeted to e-commerce investigations.
But all this as from next year, August 2027, will be also available to the EPPO and OLAF. So the hope is not only sharing information, but also creating the right environment to make EPPO, OLAF and Eurofisc coordinate their actions based on a common view on shared data systems. Thank you.
Anna Cavazzini
Thank you so much. Very interesting to also have this overview from your side. We now have already a number of members who want to speak and we start with my dear colleague, the CONT Vice-Chair, Ms. Chinicci. I'm so bad. I look like Italian, but I'm not Italian.
So Ms. Chinicci. Yes.
Caterina Chinnici
Sì, grazie. Grazie, no, grazie davvero. Io vorrei ringraziare tutti gli ospiti che sono intervenuti in questo secondo panel. E per la verità avrei una domanda per il dottor Venegoni, che ha fatto riferimento ai diversi aspetti del contrasto alle frodi e al recupero.
E proprio con riferimento al recupero delle somme, credo sia fondamentale anche la lotta al riciclaggio che di fatto ne ostacola il tracciamento. E a questo proposito voglio richiamare la sua attenzione sul cosiddetto riciclaggio di denaro basato sugli scambi commerciali, il trade-based money laundering, realizzato ad esempio attraverso dichiarazioni non veritiere sul prezzo, la quantità o la qualità delle merci importate o esportate e che è fortemente interconnesso con le frodi IVA e con le frodi doganali. E quindi vorrei chiederle, a suo giudizio, qual è il livello di capacità attuale delle autorità nazionali di identificare le attività sospette connesse alle operazioni commerciali, di condividere tali informazioni e di intervenire sulla base di queste. E ancora, posto che, come sottolinea il GAFI, questa modalità di riciclaggio potrebbe divenire purtroppo sempre più attrattiva per le reti criminali a fronte delle nuove norme antiriciclaggio nel settore finanziario, come ritiene debba potenziarsi l'azione di prevenzione, di contrasto e appunto di recupero tanto dalle autorità nazionali quanto dalle autorità dell'UE. E poi un'ultima considerazione, se mi è consentita.
E io non posso che condividere quanto lei ha già detto e da parte mia anche rinnovare alla Commissione l'invito a rendere la EPPO Academy strutturale con appositi fondi, con diciamo una struttura che consenta di far sì che si abbia una specializzazione per questo tipo di indagini che credo oggi sia fondamentale posto che le organizzazioni criminali più pericolose utilizzano questo sistema criminale per commettere i loro reati. Grazie.
Il dottor Venegoni ha fatto riferimento alla EPPO Academy.
Andrea Venegoni
Grazie, visto che mi ha fatto la domanda in italiano rispondo in italiano visto che abbiamo la traduzione. Beh allora è chiaro che rispetto a queste grandi frodi transnazionali come quelle a cui faceva riferimento lei le autorità nazionali fino ad oggi non si può dire che non si siano mosse e che non abbiano cercato di agire per contrastare questi fenomeni. Ma il problema come sappiamo delle autorità nazionali fino ad ora fino all'istituzione di EPPO è che le autorità nazionali penali stiamo parlando di autorità giudiziarie penali si devono necessariamente fermare come dire alle frontiere degli stati.
Per quanto l'azione dell'Unione Europea in questi anni sia stata improntata al tentativo di facilitare le procedure di scambio, di acquisizione delle prove nei procedimenti transnazionali, è chiaro che una singola autorità, una singola procura, addirittura di una singola città, diciamo, italiana, o io parlo per l'Italia, non può certamente condurre un'indagine di grandissimo respiro transnazionale per tutti i problemi di competenza anche del giudice che sussistono. Quindi, in questo senso, certamente le autorità nazionali hanno fatto quello che hanno potuto con gli strumenti disponibili, ma vorrei sottolineare, se mi è consentito, una volta di più, il potenziale che EPPO porta per il contrasto a questi tipi di indagini, potenziale che in questi cinque anni credo che noi abbiamo già dimostrato con la potenzialità di EPPO di poter agire, scambiare le prove, scambiare le informazioni su tutto il territorio dei 24, ora adesso 25 Stati dell'Unione Europea che compongono EPPO. E quindi il valore, uno dei valori aggiunti di EPPO, secondo me, è stato veramente in questi primi anni nelle grandi indagini transnazionali nel contrasto a queste grandi frodi transnazionali legate anche alla criminalità organizzata, perché comunque sappiamo che dietro questi tipi di frode esiste la criminalità organizzata che le usa o per autofinanziarsi o le usa per riciclare, diciamo, il denaro provento di altri tipi di reati.
Quindi è stato fatto molto, ma secondo me con EPPO abbiamo la possibilità di aprire una nuova stagione, diciamo, nella lotta a questi tipi di reati.
Anna Cavazzini
Thank you. Does any of the other experts quickly want to come in again? If not, I go to the... No. Then we go to Maria Grapini.
Maria Grapini
Mulțumesc foarte mult. Eu am câteva întrebări foarte concrete. Da, și eu sunt de acord ca EPPO să aibă o academie. Dar dumneavoastră considerați, și întrebarea e pentru toată lumea, că cei 80.000 de lucrători vamali în cele peste 2.000 de puncte vamale sunt pregătiți și au și integritate? Nu credeți că există corupție în vămi?
Eu vă spun că știu că da. Dar v-ați gândit în tot ce vrem noi aici să facem să eliminăm și corupția?
Pentru că dacă lucrătorul vamal nu respectă regulamentul de control, evident că apare frauda. Aveți a ne spune cumva un trend în ultimii ani a fraudei? A scăzut, a crescut? Pentru ca să ne dăm seama dacă ceea ce faceți dumneavoastră, toate instituțiile în cărora le-am încredințat sarcina de protejare a banilor europeni, sunt metode bune sau nu. Și ultima, puteți sau credeți că frauda, evaziunea fiscală poate să fie și din cauza unor presiuni fiscale prea mari în anumite state și atunci apare această fraudă, așa cum am spus și în prima intervenție, plătești amenda și faci mai departe fraudă?
Mulțumesc.
Anna Cavazzini
So I understood it's also to the three experts. So probably, I don't know, Frank, you can start.
Frank Heijmann
Yes, thank you. And thank you for the question. The first question is about the 80,000 officers and whether they are actually well trained. And there we see that now customs education is done in 27 member states in 27 different ways. They all are trained on different levels.
And and one of the very, very positive elements in the EU customs reform is one of the tasks being assigned for the EUCA that there must be developed common training standards, not only for the customs officials, but also for the customs professionals in the business sector. It's already been in place since about 15 years, the so-called EU recognition program for customs universities, which was a first step in trying to align the level of knowledge and the skills that officials must have in the field. But the the new approach of the EUCA will at the end lead to a better harmonized application of law. Because when you what you learn in the school together, that is what you operate and perform in your daily activities. And when we all learn it as today in 27 different ways and 27 different structures, that is actually supporting a different way of application and enforcing the law.
So harmonization of education is the first step of a harmonized application of European law. Thank you.
Andrea Venegoni
Thank you. Well, one of the effect of the establishment of the EPPO I can tell you is that naturally at the beginning of our work we started to compare the situations in the member state about detection and investigation on the on this kind of fraud.
And so everybody in Europe became aware that in Italy we have a specialized police, financial police, Guardia di Finanza. And the high number, let's say, the high number of the Italian cases are not only due to the fact that in Italy there are frauds, but also to the fact that we have a specialized financial police who is capable to investigate very deeply into this fraud. Obviously, if I do not detect fraud, I will declare that there are no fraud on my territory, but I don't know if the reality is the same. So now I can tell you that many states, many EPPO states look with very much interest to Guardia di Finanza and they started to want to copy, let's say, our system. Now in some EU member states in the EPPO offices we started to have specialized police officers that were trained also in the EPPO Academy.
Obviously, this is a little example to show this is a long process that has to to continue, let's say. But if we don't start, if we don't train the police officers, certainly we will never have trained police officers. And I think this is another positive effect of the EPPO establishment.
Constantino Lanza
Thank you. Well from my side with the Commission hat I don't have so much to say because we deal more with policy and less with this real I mean I would say what the honorable member mentioned is a real problem that is difficult to tackle from a policy point of view. We have OLAF in Brussels that has this kind of competencies. I myself I come from I'm a former official of Guardia di Finanza so I can only confirm the the positive experience. I must say also the Guardia di Finanza has its own academy where they give trainings to officials from customs police and tax administrations authorities all over the world not only all over Europe so this is for sure a good example.
So that's that's the only thing I can say that that anyway corruption is is a real problem yeah that from a policy perspective difficult to tackle.
Dirk Gotink
Thank you, Chair. First of all, I want to also commend the Guardia di Finanza because we often get news that, for example, recovery fund money or cases with recovery fund money, and it seems more often than in other countries. I think it doesn't mean that it is worse in Italy. I think it's because the Guardia di Finanza is actually doing a better job than most other institutions doing the same job. Question to Frank on the customs.
One senior customs official once told me VAT fraud is the starting capital for every self-respecting criminal organization. It is super easy, low risk, and it creates a lot of liquidity, which you tend to need as a criminal. You as a, as one of the sort of big customs experts, at least in this room at the moment, could you sort of tell us where are the wins, or where can we do more in the years that are in front of us still in relation to the customs code to actually really focus on that part of the challenge? And then to the EPPO, you know we, this Parliament has fought a lot for access of EPPO.
OLAF OLAF had already access to customs code data but EPPO didn't and I think we managed a well the maximum we could get from the member states. Also the other sort of like Frontex and others are will get access. Are you at the moment again a capacity problem question. Are you at the moment ready for access to the data hub? Because the amount of data that will come together there is absolutely spectacular.
I think it might be one of the biggest data infrastructures we have in Europe. But are you ready? Is EPPO ready for data hub access? Thank you.
Anna Cavazzini
Thank you so much. And I still have Daniel Freund. Is there any other member because we're running out of time? If not the case then I give you the floor and then we have Daniel and I'm not grouping but we have five minutes left. So the questions were first to Frank and then to Mr. Venegoni.
Please.
Frank Heijmann
Yes thank you and and thank you Dirk for the compliment. The the example that you gave was about VAT. And I already said it in my my short introduction the the tax burden of of customs duties is about 1% of the total value of trade.
The tax burden on VAT is 21%. Only this difference will make any fraud more attractive already in VAT than it is in customs duties, simply because the profit is higher when you're able to do something wrong. Then there is another very magnificent difference between VAT and customs in its processes, and I think that Marie-Lamensch already mentioned that, that is that customs duties, they are actually being paid or guaranteed at the moment that goods are being released. So there is no extended payment which is not covered by any kind of guarantee. The mechanism of VAT in the EU is that it's all, let's say, post-clearance and recapitulative statement and refund-based.
This means everything is only being paid earliest after a month or after three months. And every scheme that you set up, where you're able to set up whatever kind of shell or fake company, where customs would discover it immediately when they have the availability over the goods and then can manage directly payment or guarantee when they have any suspicions before the goods can go, in the VAT domain, everything is related post-clearance to a tax administration, and goods and people are far gone by the time that you notice that there is something wrong.
So if you want to manage a different, if you at least want to focus on that kind of difference, then that would be something to be taken into account. Thank you.
Andrea Venegoni
Well, first of all, I would like to thank the Parliament and you personally for your commitment to allow EPPO having access to this database. This was today, certainly it's a very useful tool. I can tell you, we are certainly ready to comply with this situation, provided that maybe we have enough resources to address this new situation. In this sense, as you, as you all know, we are a judicial office. That means that for EPPO is essential not only having the information, but we need to bring before the judges evidence, not information.
So once we have the information, somehow we have to elaborate this information and to transform it into an evidence for a judicial trial. That is different from having an information. So certainly the first step is having access and having the information.
But then we need specific resources to elaborate and to work on this information that are required by our nature of judicial office. So when I say resources, I'm not talking about billion of euros, but I could tell you that, I don't know, 3.5 million euros could be already enough for that. But the important thing is to understand that our role is a role of judicial office. So we are not a police office, we are not an intelligence office. It's important to have the information, but we also need to work on the information to make them available to court under national law.
And you know that one thing is having an information, another thing is bringing before a court for a national trial. They are two different things.
Anna Cavazzini
Thank you. Thank you very much for your commitment anyway. Thank you so much. And now, as I said, the last speaker for this session, Daniel Freund.
Daniel Freund
Thanks, Chair. And again, thanks to the experts. And I can actually follow up where Dirk left it, because I, you know, this question whether both EPPO and OLAF can actually handle the new databases that they're now finally getting access to, I have to admit it's still a bit unconcrete. So, I mean, when we now here in this Parliament fight over next year's budget, for example, what do I need to ask for? What do you need?
I mean, can you, you know, by what time exactly is all this operational?
How much staff would you say is necessary to deal with this? What other technical expertise or equipment is needed both for EPPO and OLAF so that we can actually make good use of this new data access, but ultimately, you know, of EU taxpayers' resources? We're losing billions in revenue for the EU budget, and by putting a fraction of that to making sure that everything that is due to the EU budget actually ends up there, you know, we can do a lot of good. So it would be really helpful if you let us know what is the timeline that you have in mind and then what is it in technical and personal equipment that you need.
Andrea Venegoni
Thank you. Thank you very much. Well, I can provide you with some numbers. I apologize with everybody because we didn't come here to request, let's say, money, but still it's useful, as you asked us, we can provide you with some data.
Certainly we would need at least four full-time experts for 24 months. As I said, we are talking about sums around 3 million euros or something like that in 2027. And probably we could slightly reduce this amount for 2028 to 1.2 million euros. And then we can estimate for the further years 0.52 million euros annually, if we really have to speak about numbers. Let me only remember everybody that it's true that apparently with this effort we are going to spend more money to support EPPO, but we have to consider also the money that EPPO recovers.
And as I said, not only the money that EPPO recovers through the executive procedures, but also the money that EPPO recovers anyway through its investigation as I explained in my presentation. We have a lot of money that is materially recovered by EPPO, paid by the suspects and the defendants into the national or European budget, that escape the statistics because it's paid under procedures that are not the official procedure of execution of the final decisions.
And I think we have to keep this into account.
Anna Cavazzini
Thank you so much, that concludes the second panel. I give the floor to my dear colleague, the CONT vice-chair.
Caterina Chinnici
Sì, grazie. Grazie, io voglio ringraziare l'onorevole Cavazzini, l'onorevole Tridico che hanno presieduto, co-presieduto insieme a me questa questa riunione. E desidero sottolineare, concludendo, proprio come il dibattito odierno abbia evidenziato, direi, la necessità di un'architettura antifrode più coerente e più efficace, in grado di colmare quelle lacune che sono emerse anche dalla discussione odierna nell'applicazione delle norme per migliorare la prevenzione, l'azione di contrasto e migliorare anche il recupero delle entrate perdute in modo da garantire una tutela più efficace agli interessi finanziari dell'Unione. Quindi ringrazio ancora tutti i relatori che hanno portato il loro contributo, i colleghi delle commissioni IMCO, FISC e naturalmente della commissione CONT e tutti davvero coloro che hanno partecipato al dibattito per il contributo prezioso che è stato offerto a questa importante e interessante discussione. Grazie ancora a tutti e buon proseguimento dei vostri lavori, del vostro pomeriggio.
Grazie.
Andreas Schwab
So, good afternoon colleagues. I'm super sorry that I have missed that very nice hearing that I had even the idea to do, but I was in a call with Katarina Barley in the Berlin office to discuss about digital and that was unfortunately scheduled at the exact at the right at the same moment. That's the reason why I have been off. I'm sorry, but I have heard that you have enjoyed this. That leads us to agenda point number two, adoption of the agenda.
I don't see any objections, like that we can confirm this. And then there is agenda point number three, chair's announcement. First, interpretation is provided in the languages set out in the CONT news website. Webstreaming is foreseen, so you have to accept that you will be filmed if you want. Adoption of the minutes.
I don't see any contradiction, so also this seems to be accepted. Agenda point number four is the adoption of coordinators' decisions.
The summary of these decisions of the meeting of the 14th of July have been circulated to the members on the 23rd of July, and I don't see any comment on this. And like that, we can come to item number five, which is the discharge 2022, the general budget of the European Union. We have to consider the draft report. Our rapporteur is Pasquale Tridico. I don't see him at that moment in time.
And we will, as usual, begin now with dealing with these cases. And this year, there is only one case of postponed discharge, as usual, the Council and the Commission, the Council and the European Council, sorry for this. And we start with the consideration of the report here. As Mr. Tridico is not here, he has been asking me to report to you what he wanted to say. And before doing this, I would just like to remind you that the deadline for tabling amendments is September 9th at 2 o'clock.
Now, Mr. Tridico has given me the following comments. Dear colleagues, the CONT secretariat, dear all. I'm very happy to be back and I speak now on behalf of Pasquale, so just to get you right. I'm very happy to be back after the summer holidays and I hope we all had some deserved rest. Today I'll present a draft report on the second Council discharge file after the almost unanimous decision to again postpone this discharge in April.
This is a regular procedure which, as has been the case for the past 10 years or more, will lead to the refusal of discharge to the Council. As every year, the draft report will be short and will get to the main point, the lack of cooperation by the Council in the discharge procedure which defies the right of taxpayers to be informed on the use of public revenues. Once again, we will remind the need for a better inter-institutional cooperation and possible revision of the treaty to better tackle the issue, to better tackle the issue of discharge to all other institutions. The file reminds the different observations detailed in the discharge file voted on 20 April this year, as well as the issue of the separation of budget and unanimity in the Council. The whole short text is in line with the political agreement which we reached early last year and was also supported by the plenary.
I hope therefore we will reach now a broad agreement again also on this postponed file, which will be voted in plenary in October too, and like that I close for Pasquale Tridico. And now I would like to give the floor to Andrey Kovatchev. Also here it's me presenting this, so now I speak in person of Mr. Kovatchev. Mr. Kovatchev thanks the rapporteur for the report which reaffirms the findings of the initial 2024 Council discharge report adopted in April 2026. The persistent lack of cooperation from the Council and the European Council and their refusal to engage are unacceptable, says Mr. Kovatchev.
Discharge is not a formality, it is one of Parliament's fundamental tools for ensuring democratic accountability, transparency and proper use of EU resources. The Parliament has a responsibility to scrutinize how EU funds are managed and this concerns also Council and European Council. We need therefore full cooperation of the institutions to fulfill this responsibility effectively and therefore Mr. Kovatchev calls on the Council and the European Council to take the necessary steps to overcome this deadlock. And here I stop now, thanking Mr. Kovatchev, and now I would like to give the floor to Csaba Molnár to take the floor on behalf of the S&D group. Over to you.
Speaker 25
I can give you if you want to read it. So, dear colleagues, just really in brief.
Csaba Molnár
So unfortunately the Council's persistent refusal to cooperate with the Parliament once again leaves us unable to grant this discharge. The draft report provides a good basis and already reflects several of the priorities we raised in the previous years. So we intend to table only a limited number of amendments to further strengthen the report, in particular by two areas. The first is reaffirming the need for robust democratic scrutiny and control over the implementation of the EU budget and the second one is adding a reference to the lack of gender balance to the original report provided by the rapporteur. So I look forward to our cooperation and the coordination of this file as we did the last years too.
Thanks.
Andreas Schwab
Thank you very much Csaba, this has been very helpful. Thanks for speaking yourself. And for the PfE, it's Mr. Knotek. And you will do it Tamás, over to you.
Tamás Deutsch
Köszönöm szépen tisztelt elnök úr.
Molnár képviselő úr kivételt jelentő hozzászólása után, aki a maga nevében beszélt, én ismételten elnök úr gyakorlatát kell, hogy folytassam. Ondřej Knotek képviselő úr, a Patrióta frakció árnyékjelentéstevője sajnos nem tud most jelen lenni a bizottsági ülésen, ezért az ő szavait tolmácsolva arról tudom tájékoztatni a tisztelt bizottságot, hogy képviselő úr, mint árnyékjelentéstevő egyetért azzal, hogy a Parlament és a Tanács között a mentesítési eljárás kapcsán fennálló, régóta húzódó nehézségek komoly problémát jelentenek, és hogy a szorosabb együttműködés, valamint a megbízható információkhoz való hozzáférés egyértelműen előnyösebb lenne a Költségvetési Ellenőrző Bizottság munkája szempontjából. Ezért fontos a két intézmény közötti párbeszéd újraindítása a patthelyzet feloldása érdekében. Képviselő úr jelzi, hogy közös célunk kell, hogy legyen a megbízható pénzgazdálkodás és a megfelelő ellenőrzés biztosítása, miközben elkerüljük a felesleges konfrontációt a tagállamokat képviselő Tanáccsal.
Emellett az egyhangú döntéshozatal kérdését egyáltalán nem kellene árnyékjelentéstevő úr szerint érinteni a mentesítési jelentésben. Ennek nincs köze a költségvetési ellenőrzéshez, az egyhangúság továbbra is a szerződéseken alapuló legitim mechanizmus, amelyen keresztül a tagállami kormányok demokratikus felelősséget gyakorolnak a különösen érzékeny területeken. Alkalmazásának, mármint a vétó alkalmazásának bénultságként vagy akár zsarolásként való leírása nem segíti elő a konstruktív párbeszédet. Ennek megfelelően fog árnyékjelentéstevő úr frakciónk részéről módosító javaslatokat benyújtani. Köszönöm szépen.
Andreas Schwab
Thank you very much, Tamás. Next one is Mr. Sturza, but he will be replaced by Mr. Eriksson. Over to you.
Dick Erixon
Yes, please, thank you. The Council also spends taxpayers' money, so it should be accountable to the citizens who pay it. But let us be honest about the guards in this Union. It is the Member States in the Council, and mainly the frugal Member States, that cut the annual budget and strike out spendings that does not deliver.
Last year the member states took 1.3 billion euro out of the Commission's draft budget for 2026. This Parliament put every euro back and added another 600 million on top. The member states are closer to their citizens so they have to answer more directly for where taxes go and what people gets back. That is why it is wrong to demand treaty changes and more power to Brussels. I'm grateful to the veto on tax exists.
It is what stops some parties in this house from putting more tax burdens on our citizens and spending more of their money. Thank you.
Andreas Schwab
Thank you very much, Mr. Eriksson. Next one would be the Liberal Group, but Mr. Garicano and I think no other colleague is here, so I will give the floor to Damian Boeselager from the Greens, but I think it will be done by Mr. Freund.
Daniel Freund
But yes, I have to say, I mean, what the colleague from the ECR just said, I mean, there is a difference between budget reduction and budget control. We can all talk about whether the budget is correctly allocated and whether it should be larger or smaller, but once we decide on a budget as legislator jointly with the Council, we should make sure that that budget is executed accordingly. And the part of the Council we cannot see. And we cannot fulfill the task given to the European Parliament in the EU Treaty. And I have to say, I mean, I'm all fine that we do this year after year and it's the 15th iteration that we have not discharged the Council.
The shadow is now Rasmus Nordqvist since Damian Boeselager has left the committee.
But I have to put this back to colleagues. I think that at some point in time, I don't know when we're ready to do this, after 20 times no discharge or 30, I'm open to discuss. But I think ultimately we should do something about it because just writing it down every year and adopting it with a large majority as we do is not changing the behavior of the Council. And I think quite honestly that that is unacceptable. The treaty is very clear about us discharging the EU budget, including the part that is being spent in the Council.
And I think we ought to do something about that.
Andreas Schwab
Thank you very much, Daniel Freund. If any other member would like to speak, please. Maria.
Maria Grapini
Voi vorbi în limba română. Da, vreau să continui ce a spus colegul. Am fost și eu raportoare de descărcare de gestiune și la Comisie, nici n-am semnat raportul, și la Consiliu. Este limpede că trebuie făcut ceva pentru că dacă șefii de stat și de guverne, cine-i Consiliul, șefii de stat și de guverne, dau un asemenea exemplu de lipsă de transparență, cum poate să aibă încredere cetățenii că da, Uniunea Europeană este un proiect important, avem nevoie de acest proiect. Dar pentru asta trebuie transparența să n-o clameze Consiliul doar să ceară statelor membre, să ceară Parlamentului, să ceară instituțiilor Uniunii Europene și Consiliul, dar eu zic că și Comisia în mare măsură, dau dovadă de o lipsă de transparență repetabilă, să spun așa.
Și dacă soluția este că da, noi nu descărcăm de gestiune, dar continuă să facă la fel, cred că pot fi căutate alte soluții juridice.
Andreas Schwab
Danke, Frau Kollegin Grapini, gibt's weitere Wortmeldungen? That doesn't seem to be the case, then we can close this item.
Thank you for your contribution and we will then further proceed with the file as foreseen. We then come to agenda item number six, which is the special report of the European Court of Auditors on improving the energy efficiency. And I would like to give the floor here right at the beginning to our colleague from the European Court of Auditors, which is Mr. Nikolaos Milionis. A very good name for a court, for an auditor. He is the rapporteur for the special report.
And there is also Christina Jordan, who is the head of unit Economics and Resilience, and Francesco Carlucci, he's the head of unit Recovery and Resilience. Welcome to all of you. I would also like to thank my colleague, hardworking on the budget, Carla Tavares. She is following this file very closely from our side. Thank you very much for this.
But I think we agree we give the floor, Carla, to Mr. Milionis to present the special report and then it will be you speaking on our behalf. And therefore over to you, please.
Nikolaos Milionis
Unfortunately my surname is with one L instead of two Ls. Thank you. Well, dear chair, honorable members of the European Parliament, ladies and gentlemen, it is a great honor for me to present to the Budgetary Control Committee our latest report on funding energy efficiency renovation of private homes. Next slide please. Why did...
Wait a minute, there is a problem with the presentation. This is not yet the presentation. This is the Commission's presentation. Yeah, it's a mistake now. It's the Commission's presentation I suppose.
Can you correct it or not to continue? We have the problem in Europe, positive findings are always too short.
Why did we do this? The Recovery and Resilience Facility, the RRF, set aside 43 billion euros to support energy efficiency improvements in private homes. This represents around 8% of total available RRF funding. This is also significantly more than what cohesion funds are providing for residential energy efficiency.
Residential buildings account for a quarter of EU energy use, and around 75% of them are still energy inefficient. Improving their efficiency is essential to lower bills, ensure energy security, and achieve climate neutrality goals. Well, what did we look at? Our audit asked whether RRF investments and reforms contributed to the energy efficiency of residential buildings effectively and cost-effectively. We examined whether the framework adequately addressed renovation needs, whether the measures were progressing and delivering savings, and finally, whether their results and cost-effectiveness were adequately monitored.
The audit covered February 2020 to December 2025. We analyzed relevant information across the Union and carried out detailed work in Belgium, Italy, Cyprus, and Lithuania.
In these four Member States, we examined 28 measures: 18 investments and 10 reforms. We analyzed costs, targets, and reported savings, and finally visited 27 renovation projects. We also interviewed the responsible authorities and consulted specialists. Next slide, please. What did we find?
Our main conclusion is straightforward. The RRF has provided broad financial support, but weaknesses in design and implementation limit how much energy is actually saved and at what cost. Overall, the RRF mainly financed medium-depth renovations. Reforms were not clearly defined and their effect on investments and energy savings was not demonstrated. There were implementation delays, while actual results and cost-effectiveness were not adequately analyzed or monitored.
Now let me present you these findings in more detail. Next slide, please.
The first is the weaknesses in the foundations. Before the RRF was launched, the Commission has stressed the importance of deep renovations, of deep renovations, those achieving more than 60% energy savings. Yet, the RRF regulation made no reference to deep renovation. Only one member state, Romania, associated an RRF measure with a target explicitly referring to deep renovations. Across the Union, measures targeting at least medium depth renovation represented more than 80% of estimated costs, while for the remaining part there was no minimum energy saving requirement.
Medium or light renovation can be useful, but when it is not planned as part of a coherent pathway towards higher performance, it can create a lock-in effect. In this case, initial works may make deeper renovation later more difficult or more expensive. We also found weaknesses in project selection in the four audited member states.
Projects were generally selected on eligibility, and all eligible projects were financed while funding remained available. There was no comparative quality assessment to rank projects according to expected results. The criteria were often not significantly selective to direct support towards the worst performing buildings or households with greater financial need. Supporting reforms alongside investments is a key innovation of the RRF. However, the concept of a reform was not clearly defined, leading to inconsistent approaches across member states.
Some measures described as reforms were in substance mainly investments. Other reforms could support future investment, but there was insufficient evidence and a lack of suitable indicators to demonstrate their effects. Next slide, please. Shortcomings in achieving results.
Although the RRF was intended to be performance-based, most targets focused on outputs, such as the number of area of homes renovated, rather than on results, meaning energy savings. Among more than a hundred renovation measures across the Union, we found only three with result-oriented targets. This limits the Commission's ability to assess performance. Measures that were simple to implement or offered very high support generally progressed quickly. More complex measures, including roof or wall insulation, were more difficult to deliver within the RRF time frame.
At the time of our audit, 12 of the 18 investments we examined in detail were delayed. Targets had also been reduced in 13 cases. Even after revisions, some measures remained at risk of not being completed by the RRF deadline. We also identified significant weaknesses in the information used to report energy savings.
Energy performance certificates are useful for showing a building's performance under standard conditions. However, they were not designed to measure actual savings from a publicly funded scheme. Their estimates can differ subsequently substantially, sorry, substantially from actual consumption because consumption is affected by residents' behavior. This performance gap was not reflected in reporting savings. Certificates and calculation methods also differ between and within member states, limiting comparability.
Checks by national and regional authorities found anomalies and our review identified further reliability issues. At EU level energy at EU level, energy savings are aggregated under common indicator one across all RRF measures, including those targeting public building and enterprises. The data is not sufficiently broken down to assess residential renovation measures individually.
The Commission carries out plausibility checks on the data reported by Member States but does not examine the figures in detail. Overall, we found that the available information on achieved energy savings was not reliable, comparable or detailed enough for meaningful monitoring of actual results. Next slide please. Lack of...
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