Direct Access for EPPO & OLAF to Fight EU VAT Fraud

The European Commission proposed changes to Regulation 904/2010 to strengthen cooperation and anti-fraud measures in the field of VAT by formally integrating the European Public Prosecutor’s Office (EPPO) and the European Anti-Fraud Office (OLAF) into the existing administrative cooperation framework. At its core, the proposal aims to close information gaps between tax authorities and EU-level enforcement bodies by granting both EPPO and OLAF a more direct role in VAT-related cooperation.

Impact of the Proposal

Under the proposed amendments, both EPPO and OLAF would be connected directly to the Eurofisc network, a EU platform used by national tax administrations to exchange information and detect cross-border VAT fraud. By adopting this, the EU regulators would allow faster, more structured communication between national authorities and EU anti-fraud bodies. Additionally, the EPPO and OLAF would receive specific, direct, and centralised access to the VAT-related IT systems established under the Regulation. 

Currently, both bodies can obtain VAT data exchanged under the Regulation only through bilateral cooperation with individual national tax authorities, which has significantly limited the speed and effectiveness of information flows. The limits of the current system have proven to be slow and administratively burdensome, particularly in cases of intra-Community VAT fraud that typically span multiple EU countries and require rapid, coordinated action.

In more practical terms, the proposal sets out concrete obligations to ensure a more effective flow of VAT-related information to the EPPO and OLAF, such as mandating Eurofisc working field coordinators to inform both bodies on their own initiative whenever information exchanged between EU countries points to suspected cross-border VAT fraud. Moreover, the coordinators would also have to provide relevant information to EPPO and OLAF upon request when it is needed for ongoing VAT fraud investigations.

In addition to information-sharing duties, the proposal obliges EU countries' competent authorities to grant the EPPO and OLAF centralised access to EU VAT IT systems to conduct targeted searches. The proposal further aims to provide EPPO and OLAF with access to key EU VAT information systems, including the VAT Information Exchange System (VIES), the SURVEILLANCE system, and the CESOP system.

Conclusion

It is essential to note that this proposal is subject to a special legislative procedure, meaning that, to be implemented, the Council must approve it unanimously after the European Parliament and the European Economic and Social Committee have been consulted. The main reason for this is the sensitivity of the tax and the need for full agreement among EU countries.

Source: eucrim, Proposal for a Council Regulation amending Regulation (EU) No 904/2010