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COURT OF AUDITORS OPINION No 6/2011 (pursuant to Article 325 TFEU) on the amended proposal for a Regulation of the European Parliament and of the Council amending  Regulation (EC) No 1073/1999 concerning investigations conducted by the European Anti-Fraud Office (OLAF) and repealing Regulation (Euratom) No 1074/1999

The Court of Auditors notes that the political guidelines formulated by the Commission's President to the effect that OLAF should be given full independence outside the Commission have not been addressed. On the contrary, the draft Commission decision reinforces the Commission's role in the process of selecting OLAF's Director- General and restricts the Director-General's appointing-authority powers with regard to the Office's staff The Court's observations take into account the recommendations made in previous opinions (see summary of 6/12/2006) of the Court as well as the findings of the audit of the Office, as set out in Special Report No 2/2011.

General observations

A need to simplify and consolidate anti-fraud legislation: the Court regrets that the Commission has not followed up the Court's repeated recommendation to simplify and consolidate the anti-fraud legislation currently in force and to address weaknesses in OLAF's powers and procedures in this context. Any such recasting should include the OLAF Regulation, Council Regulation No 2988/95 on the protection of the European Communities' financial interests and Council Regulation No 2185/96 concerning the on-the-spot checks and inspections carried out by the Commission. Without such a recasting, legal certainty is undermined due to the coexistence of overlapping, incoherent or even incompatible provisions which are difficult to understand and apply.

A need to clearly define the notion of 'financial interests of the Union': the Court reiterates its recommendation that the notion of 'the financial interests of the Union' which is central to all anti-fraud legislation should be clearly defined, and amended in the light of recent jurisprudence. Furthermore, it draws attention to the need to amend Council Regulation No 2988/95 in connection with the fight against VAT fraud. 

A need for independent control of the legality of investigations in progress: the Court appreciates the proposal to introduce provisions for procedural guarantees and takes note of the proposal for an internal review procedure. It regrets, however, that the objective of independent control of the legality of investigative acts in progress will not be achieved under the Commission proposal. For such a control to be effective it must be carried out by a body or a person independent of OLAF which has the power to issue binding opinions. This control of investigative acts in progress is particularly necessary for cases where the persons concerned are not informed that they are subject to an investigation in order to preserve its confidentiality.

A need for effective and equivalent protection of financial interests: the new Article 325(4) TFEU now explicitly requires the European Parliament and the Council to adopt the necessary measures with a view to affording effective and equivalent protection of the financial interests of the Union in all the Union's institutions, bodies, offices and agencies. Currently OLAF's investigations are subject to differing conditions laid down in individual internal decisions by the Union's institutions, bodies, offices and agencies. The Court believes that such internal decisions may not necessarily be justifiable in all cases and may result in limiting the scope of OLAF's investigative activities and so jeopardising the effective and equivalent protection of the financial interests of the Union.

A need for clear rules to investigate serious misconduct in non-financial matters: since it is based on Article 325 TFEU, the scope of the OLAF Regulation is limited to investigations concerned with irregularities affecting the financial interests of the Union. There is a need for clear rules to investigate internal cases of serious misconduct which do not concern the financial interests of the Union but are liable to result in disciplinary and/or criminal proceedings, or in proceedings before the European Court of Justice. Existing legislation in this respect is very succinct and applies only to staff concerned by the Staff Regulations and the Conditions of Employment of Other Servants of the EU. The Court believes that the legislator ought to consider what options are available under the Treaty in order to ensure that all cases of serious misconduct are properly investigated.

A need to keep the text concise, clear and consistent: the Court considers that, taken as a whole, the amendments fail to ensure that the provisions of the OLAF Regulation are as concise, clear and consistent as possible. An example in this respect is the use of the terms 'the Office' and 'the Director-General of the Office' which does not seem to follow any particular logic and is further complicated by the introduction of specific provisions for delegating the Director-General's powers to other staff of the Office. The Court gives other examples of vague wording and unclear drafting.

Specific observations

Priority of the core investigative function: the Court recommends that a new wording of the OLAF Regulation should clearly stress the priority of OLAF's core investigative function over other tasks. OLAF's effectiveness critically depends on devoting a greater share of its resources to investigative activities.

Clarification of key notions needed: the proposal is incomplete as it does not correctly define all the required terms and certain definitions, such as "administrative investigation" require amendment.

Amendments to Regulation (EC) No 2185/96 are required, in order for it to be consistent with the proposal, which extends the use that can be made of the procedures laid down in Regulation No 2185/96 to a number of situations which are not envisaged in the Regulation.

Clarifying the importance of the Staff Regulations for internal investigations: the Court recommends that text on internal investigations should contain a clear reference to the Staff Regulations given their importance for OLAF's internal investigations.

Avoiding confusion with regard to the opening of investigations: the proposed text on the opening of investigations contains complicated provisions that are vaguely worded, and need to be clarified, with particular references to the time frames proposed.

Reinforcing procedural guarantees: the Court makes several recommendations particularly with regard to the rights of witnesses who are interviewed.

Internal review procedure: the Court considers that the required complete independence in the post is not guaranteed as those entrusted with the review procedure remain under the authority of the Director-General. Furthermore, it is not clear whether, and when, the Supervisory Committee will receive copies of the opinion which the person in charge of a review of a case has submitted to the Director-General and of the reasoned reply which has been sent to the person concerned.

The Court suggests creating the function of a review officer, who should neither be appointed by the Director-General nor be subject to his authority.

Cooperation with Eurojust, Europol and international organisations: the Court recommends that objective criteria should be introduced to identify appropriate cases for collaboration, similar to those contained in the 'Practical Agreement on arrangements of cooperation between Eurojust and OLAF'.

Clarifying the role of the Supervisory Committee: the Court recommends that the Committee's monitoring should extend to exchanges of information between the Office and the authorities of the Member States, including the exchange of information through Eurojust. It also recommends clarification that the Committee needs access to OLAF's case files in order to be able to detect instances of interference with the Office's independence.

The 'exchange of views procedure' may undermine investigative independence: such a procedure could be perceived as undermining the independence of the Director-General in defining the investigative priorities of the Office. Furthermore, such a procedure could evolve into a kind of de facto governing board of the Office without the responsibilities of those participating in it being clearly defined and without any indication of the procedural framework for such an exercise.

Clarifying the role of the Director-General: the Court sees no valid reasons for the Commission's proposal to delete from the text the obligation to report to the Court of Auditors on the findings of investigations carried out by the Office. It also draws attention to the risk that certain provisions in the proposal might result in diluting key responsibilities of the Director-General.

The European Parliament adopted, by 450 votes to 8 with 11 abstentions, a legislative resolution, amending the proposal for a regulation of the European Parliament and of the Council amending Regulation (EC) No 1073/1999 concerning investigations conducted by the European Anti-Fraud Office (OLAF).

The report had been tabled for consideration in plenary by Ingeborg GRÄSSLE (EPP-ED, DE) on behalf of the Committee on Budgetary Control.

Parliament wanted to improve the protection of fundamental rights of the persons concerned by investigations and strengthen cooperation with Member States. The main amendments - adopted in the 1st reading of codecision procedure - are as follows:

- a new recital states that it is necessary to provide a legal basis for adoption of a procedural code for OLAF investigations. The code should be published in the Official Journal of the European Union. ;

- Members provide for the systematic exchange of information between OLAF and Eurojust whenever a competent national authority receives from OLAF information on suspicions of fraud, corruption any other illegal activity, in the form of serious crime involving two or more Member States;

- the Office may conclude cooperation agreements with Eurojust and Europol. The aim of these agreements shall be to clarify the respective powers and responsibilities of these bodies and to define the cooperation between them within the framework of the area of freedom, of security and of justice. The Office may also conclude cooperation agreements with other international organisations;

- people who are under investigation by OLAF should be treated equally as regards procedural guarantees and legitimate rights, irrespective of whether the investigation is internal or external;

- checks on legality must be carried out by the Office, in particular prior to the opening and the closing of an investigation and prior to any forwarding of information to the Member States" competent authorities. Such checks will be carried out by legal experts who may play a judicial role within a Member State and who will work within the Office;

- in order to strengthen respect for procedural guarantees, any person who is under investigation by the Office should be able to lodge a complaint with the Supervisory Committee. Complaints will be dealt with by a  Review Adviser acting in complete independence, appointed by the Director General, on a proposal of the Supervisory Committee. The Review Adviser will deliver his opinion within 30 working days and will forward it to the plaintiff, to the Director General of the Office and to the Supervisory Committee;

- anonymous information may also be taken into account if it constitutes sufficiently strong grounds for suspicion in order to open an investigation;

- the institutions should also be given the power to ask the Director General of OLAF to open an investigation. Prior to the opening and throughout the duration of an investigation, the institutions, bodies, offices and agencies shall provide the Office with immediate and automatic access to databases concerned with the management of Community funds and to any other base containing relevant data and information which will enable the Office to check that the information forwarded is accurate;

- the Office's employees shall be equipped for each intervention with a written authority issued by the Director General indicating the subject matter and the purpose of the investigation, the legal bases for conducting the investigation and the investigative powers stemming from those bases;

- where Office employees nominated to carry out an on-the-spot check or inspection in accordance with the rules laid down in Regulation (Euratom, EC) No 2185/96 encounter resistance from an economic operator, the competent authority of the Member State concerned (previously identified by the Office as a contact point) shall be informed immediately. At the Office's request the competent authority of the Member State concerned shall provide them with the assistance which they require in order to carry out their task. Member State must ensure that the Office's employees are allowed access (under the same terms and conditions as its competent authorities and in compliance with national law) to information and documents relating to the facts which prove necessary for the on-the-spot checks and inspections to be carried out satisfactorily;

- where it is found that an investigation cannot be closed within 12 months after it has been opened, the Director-General of the Office may decide to extend the period by up to 6 months. The Director General of the Office shall ascertain the need for the investigation to be extended. Before taking this decision, the Director General shall inform the Supervisory Committee of the reasons preventing the investigation from being concluded and of the likely period of time needed for it to be completed;.

- if an investigation is not completed within 18 months after it has been opened, the Supervisory Committee shall be informed by the Director General of the reasons which have prevented him from closing the investigation and shall issue an opinion on the extension and, where appropriate, the subsequent running of the investigation. The Director General of the Office shall submit to the budgetary authority an annual report on the reasons which have prevented him from closing investigations within 30 months after they have been opened. The Supervisory Committee shall submit an opinion on those reasons to the budgetary authority;

- investigations shall be conducted objectively and impartially and in accordance with the principle of the presumption of innocence and the procedural guarantees set out in the procedural code for OLAF investigations;

- Parliament inserted a clause on the protection of journalistic sources: in order to make it possible to provide objective information to European taxpayers and to guarantee freedom of the press, all EU bodies involved in the investigation must respect the principle of protecting journalists' sources in accordance with national legislation;

- OLAF investigations must be conducted in accordance with certain procedural principles and individual rights. Members introduce new provisions stating that persons subject to investigation have the right to submit comments on the conclusions of the investigation's final report before it is adopted;

- following an investigation which has not produced results, the people concerned and, in the case of an official, the institution to which he belongs, should be informed of the conclusion of the investigation as soon as possible;

- employees of the Office must ensure that the investigation is conducted in accordance with procedures which will enable items of evidence to be safeguarded and preserved. If necessary (where there is a risk that items of evidence will disappear) they may asked the competent authority of the Member State concerned to take any necessary precautionary or implementing measures; es si -Employees of the Office may ask the competent authorities of third countries for assistance in the performance of their duties, pursuant to the provisions of the cooperation agreements concluded with those countries. They may also request assistance from international organisations in the performance of their duties, pursuant to the provisions of the agreements concluded with those organisations;

- reports drawn up following an internal investigation and any useful related documents shall be sent to the institution, body, office or agency concerned. The institution, body, office or agency shall take such action, in particular disciplinary or legal, on the internal investigations, as the results of those investigations warrant, and shall report thereon to the Director General of the Office. To that end they shall send the Director General of the Office, every 6 months or, where appropriate, within the time-limits that the Director General has set, a report on the progress made;

- the Director General of the Office shall report regularly, at least once a year to the European Parliament, the Council, the Commission and the Court of Auditors on the results of the investigations carried out by the Office, with due respect for the confidentiality of those investigations, the legitimate rights of the people involved and, where applicable, the national provisions applicable to judicial procedures.

- the European Parliament, the Council, the Commission and the Court of Auditors shall ensure that the confidentiality of the investigations carried out by the Office, the legitimate rights of the people concerned and, where there are judicial procedures, all national provisions applicable to those procedures, is preserved;

- a concertation procedure between the European Parliament, the Council and the Commission shall be established. This procedure enables the Community legislature, the budgetary authority and the Commission to discuss various aspects relating to fighting fraud. It makes it possible to identify the appropriate solutions (operational, legislative, institutional) to the difficulties encountered by OLAF in carrying out its remit; 

- the Office shall adopt a "procedural code for OLAF investigations" incorporating the judicial and procedural principles adopted under the present regulation. It shall take account of the Office's operational practices.

PURPOSE: proposal to reform the European Anti-Fraud Office (OLAF).

BACKGROUND: the European Anti-fraud Office (OLAF) was established in 1999. In 2006, the Commission put forward a proposal for amending Regulation 1073/1999 concerning investigations conducted by the European Anti-fraud Office (OLAF) with a view to achieving better operational efficiency and improved governance for the Office. The proposal of the Commission was discussed both in the Council and the European Parliament. The latter adopted a resolution on 20 November 2008 in first reading under the co-decision procedure. It put forward approximately one hundred amendments to the Commission's proposal. Many amendments have been welcomed by the Commission.

At the request of the Czech Presidency of the Council (January-June 2009) the Commission presented in July 2010 a Reflection paper on the reform of the Office. This document outlines possible solutions to take forward the current legislative process. The European Parliament welcomed in October 2010 the Reflection paper and asked the Commission to take up the legislative procedure again. On 6 December 2010, the Council adopted conclusions on the Reflection paper put forward by the Commission.

The Commission has now prepared an amended proposal that takes into account the positions expressed so far and looks forward to achieving the current legislative reform as soon as possible.

IMPACT ASSESSMENT: no impact assessment was carried out.

LEGAL BASIS: Article 325 of the Treaty on the Functioning of the European Union, in conjunction with Article 106a of the Treaty establishing the European Atomic Energy Community.

CONTENT: the aim of the amended proposal is to improve the efficiency, effectiveness and accountability of OLAF, while safeguarding its investigative independence. The proposal also aims to ensure that the fundamental rights of the persons under investigation are fully respected and even strengthened. The Commission focuses on certain key areas.

Establishing better procedures for cooperation and information exchange between OLAF, the EU institutions and other relevant bodies, such as Europol and Eurojust. Instead of a formal structured dialogue between the Supervisory Committee and the institutions on the investigative function of the Office, a periodical exchange of views is now proposed to increase the Office's governance while respecting its operational independence. The exchange of views will be established between the European Parliament, the Council, the European Commission, with the participation of the Office and the Supervisory Committee. This exchange of views should contribute to the exchange of information and opinion between the stakeholders for an improved efficiency of the Office's activity. The exchange of views should not interfere with the conduct of investigations and it should relate to the strategic priorities for the Office's investigative policies, the reports on the activities of the Supervisory Committee and that of the Director-General of the Office, the relations between the Office and the EU institutions, bodies, offices and agencies; the relations between the Office and the competent authorities of the Member States and the effectiveness of the work of the Office with regard to investigations and that of the Supervisory Committee. In line with the opinions expressed by the institutions, the exchange of views will be flexible: it will take place periodically or upon request of one of the above-mentioned institutions, the Office or the Supervisory Committee.

OLAF already has a cooperation arrangement with Eurojust, and the amended proposal gives OLAF the option of concluding administrative arrangements with Europol, as well as with third countries' competent authorities and with international organisations.

Facilitating improved relations between OLAF and Member State authorities in order to allow better on-the-ground investigations and greater follow-up on OLAF cases. The Commission proposes the following:

• an authority (anti-fraud coordination service) should be designated by each Member State to assist the Office in its collaboration with the national competent authorities. This does not mean that a new authority would be established. Experience shows that due to the different structures in each Member State, it is often very difficult for the Office to address the competent authority in a given Member State ;
• regular monitoring is especially important for internal investigations, to ensure that disciplinary action or other measures can be taken by IDOC or equivalent entities in other institutions, bodies, offices or agencies. It is therefore proposed that Member States report upon OLAF's request on the follow-up given to the information transmitted to them by OLAF. In order to avoid unnecessary administrative burden for Member States, the amended proposal provides that they will report to OLAF upon its request on the actions taken and progress made following transmission of information by OLAF. .

Clarifying OLAF's objectives and the role of the Director General, and looking at how OLAF's work can be carried out in a more efficient manner. Clear recommendations are set out on the duration of investigations and on the targeted use of OLAF resources. OLAF's Director General will continue to be ultimately responsible for deciding which investigations OLAF carries out. However, the Commission proposes that an internal body should be established within OLAF, to help with these decisions. The Director-General will consult the internal body when opening an investigation, before closing an investigation and whenever he deems necessary. To clarify the internal decision-making procedures with respect to the role of the Director-General of the Office, the Director-General may also delegate in writing the direct execution of investigations to individual members of the staff of the Office. The term of the Director-General should be non-renewable in order to reinforce his independence. To ensure continuity, and in light of recent experience, deputising rules are provided in the amended proposal. The Commission also proposes that:

• the Supervisory Committee should examine the length of investigations based on information supplied by the Office. In cases where investigations cannot be closed after 12 months, the Office should inform the Supervisory Committee of the reasons preventing the finalisation of the investigation at intervals of 6 months. This way, a continuous monitoring of the duration of investigations will be ensured until their closure;
• the institutions, bodies, offices and agencies whose member/staff member or budget is concerned by an investigation should be informed by the Office without undue delay. In that way, the institutions, bodies, offices and agencies may take precautionary administrative measures. It is their responsibility to ensure the best protection of the EU's financial interests and to avoid any continuation of an irregularity or potential increase of financial loss. Their information is therefore absolutely necessary. For exceptional cases, in which the confidentiality of the investigation cannot be ensured (for instance if the highest management or political level of an institution, office, body or agency is concerned), the Office should use appropriate alternative channels of information;
• the amended proposal further develops the de minimis approach of the 2006 proposal: with regard to the opening of investigations, the Office should take into account the investigation policy priorities and the need for efficient utilisation of OLAF's resources. With specific reference to internal investigations, OLAF should consider whether such investigations are best carried out by the institution, body, office or agency concerned, or by OLAF itself. Furthermore, in cases where OLAF, having carried out an internal investigation, considers that, in the light of the nature of the facts and the scale of the financial damage, internal measures allow for more appropriate follow-up, it should forward the case to the Investigation and Disciplinary Office of the Commission (IDOC) or to the institutions, bodies, office or agency concerned, instead of sending it to the competent national judicial authorities. Thus, the de minimis policy (cases where the Office decides not to open an investigation or not to forward its findings to the competent national judicial authorities) has been clarified in the amended proposal. When implementing the de minimis policy, the Office should apply precise guidelines, as proposed by the Council in its Conclusions of 6 December 2010;
• the distinction between internal and external investigations should be limited to the extent strictly necessary. This would facilitate the conduct of investigations. As experience has shown, investigations can start as external ones and later lead to internal investigations or vice versa. Under the current legal framework, persons concerned in internal investigations have a duty to cooperate with the Office according to the Staff Regulations or the Protocol on the Privileges and Immunities of the European Union. The Office's investigative powers are also more detailed in internal investigations. The procedural and fundamental rights of the persons concerned have to be fully respected, be it in an internal or an external investigation;
• the role of the Supervisory Committee is further clarified. It should expressly be mandated to monitor information exchanges between the Office and the institutions, bodies, offices and agencies and the developments regarding the application of procedural guarantees. It should also monitor in a general and systemic way the developments regarding the duration of investigations, without interfering with the conduct of investigations. Regarding the appointment of the members of the Supervisory Committee, a staggered renewal is envisaged to preserve its expertise. The Supervisory Committee should be consulted for the appointment of the Director-General and the designation of the deputising Director(s) and should be informed about transmissions to judicial authorities.

Strengthen the procedural rights of persons concerned by the Office's investigations: the amended proposal makes the procedural guarantees clearer and more transparent and to have them apply to all investigations conducted by the Office, both internal and external. These guarantees respect the fundamental rights recognised in particular by the Charter of Fundamental Rights of the Union. Common procedural rights for both internal and external investigations are provided by this proposal. These include the right for the person concerned by an investigation to make his/her views known before conclusions referring by name to him or her have been drawn; the right to be given a summary of the matters under investigations and to be invited to comment on these matters; the right to be assisted by a person of his/her choice during an interview; the right to use the EU language of his or her choice; the principle that any person concerned by an investigation shall be entitled to avoid self-incrimination. The practical application of these rights should be reflected in the Office's manual of procedures for investigations (OLAFmanual) as adopted by the Director-General. In the proposal of 2006, the Commission proposed a Review Adviser to whom cases may be referred for his or her independent opinion regarding the procedural guarantees. In order to avoid overlapping with the tasks of the Supervisory Committee and to avoid additional formal structures while guaranteeing an effective, efficient, and independent handling of individual complaints, the Commission now proposes that a review procedure be set up, by the Director-General within the Office. The person or persons entrusted with the review procedure should act in full independence. The Director-General of the Office will report to the institutions about the measures taken for the setting up of the review procedure.

As to the fundamental right to the protection of personal data, the amended proposal provides for clarification and more detailed provisions implementing the principles of Regulation (EC) No 45/2001, in particular the requirement that OLAF appoint a Data Protection Officer.

The Director-General should adopt, after consultation of the Supervisory Committee, the person or persons entrusted with the review procedure, and the Office's Data Protection Officer, and the OLAF manual of procedures. This manual shall provide guidelines on the practical application of the administrative investigations by the Office.

BUDGETARY IMPLICATIONS: the proposal has no impact on the EU budget.

OPINION OF THE EUROPEAN DATA PROTECTION SUPERVISOR on the Proposal for a Regulation of the European Parliament and of the Council amending Regulation (EC) No 1073/1999 concerning investigations conducted by the European Anti-Fraud Office (OLAF).

This Proposal contains revisions to most of the articles of Regulation (EC) No 1073/1999, which sets forth the operational rules to be followed by those involved in OLAF investigations and, as such, constitutes the legal basis for OLAF's operational activities.

The EDPS welcomes this Proposal insofar as it makes more explicit the procedural guarantees of individuals concerned by OLAF investigations, including the protection of personal data of such individuals. From the perspective of the protection of individuals' rights to the protection of their personal data and privacy, the EDPS considers that, for the most part, the Proposal contains improvements vis-à-vis the current legal framework. In addition, the EDPS welcomes the Proposal's recognition that Regulation (EC) No 45/2001 applies to all data processing activities carried out in the context of OLAF investigations.

However, the EDPS is concerned by the fact that most of the proposed amendments do not reach the minimum data protection standards contained in Regulation (EC) No 45/2001. He is concerned that if the Proposal could be deemed to take precedent over the application of the general data protection framework contained in the Regulation, this would entail an unacceptable watering down of the data protection standards in the context of OLAF investigations. This is particularly worrisome in the light of the sensitive nature of the type of data that may be collected. In order to avoid this outcome, the EDPS requests the Community legislator to take into account the following issues and make the related amendments in the Proposal in order to address them:

1) Shortcomings regarding the right of information: providing information to individuals to ensure fair processing constitutes an indispensable safeguard which should not be unduly compromised. To avoid it, the Proposal should be amended as follows:

• Articles 7a2 first paragraph and 8a should include an explicit reference to Articles 11 and 12 of Regulation (EC) No 45/2001 in order to ensure fair processing;
• the limitation to the right of information of Articles 7a2 first paragraph and 8a second paragraph should be linked to the safeguards of Article 20 of Regulation (EC) No 45/2001.

2) Shortcomings regarding the right of access: a new provision should be added recognising as a general principle the right of access to personal information gathered in the context of OLAF investigations which could be inserted between the first and second paragraph of Article 7a.2. Such a provision could read as follows:

• 'Any person implicated in an investigation has the right to access personal data related to him/her which are gathered in the course of the investigation. Such right(s) may be subject to the limitations foreseen in Article 20 of Regulation (EC) No 45/2001'.

3) Shortcomings regarding the right of rectification: restrictions to the right of rectification should only be provided to the extent that they are permitted under Regulation (EC) No 45/2001. The Proposal contains additional restrictions that should be avoided as follows:

• a provision should be added stating that suspected individuals have a general right to have their views known regarding any piece of information that referred to them, except if an exception under Regulation (EC) No 45/2001 applies. In particular, after having stated that any person implicated in an investigation has 'at any time the right to access personal data related to him/her gathered in the course of the investigation', it should be added that an individual has the subsequent right 'to make his views known on whether the personal data is inaccurate or incomplete';
• the EDPS suggests that the limitation to the right of access and rectification foreseen in Article 7a2, 3rd paragraph be linked to the guarantees of Article 20 Regulation (EC) No 45/2001.

Lastly, the EDPS is also of the view that it would be appropriate for this Proposal to include a new paragraph guaranteeing the confidentiality of whistleblowers.

OPINION OF THE EUROPEAN DATA PROTECTION SUPERVISOR on the Proposal for a Regulation of the European Parliament and of the Council amending Regulation (EC) No 1073/1999 concerning investigations conducted by the European Anti-Fraud Office (OLAF).

This Proposal contains revisions to most of the articles of Regulation (EC) No 1073/1999, which sets forth the operational rules to be followed by those involved in OLAF investigations and, as such, constitutes the legal basis for OLAF's operational activities.

The EDPS welcomes this Proposal insofar as it makes more explicit the procedural guarantees of individuals concerned by OLAF investigations, including the protection of personal data of such individuals. From the perspective of the protection of individuals' rights to the protection of their personal data and privacy, the EDPS considers that, for the most part, the Proposal contains improvements vis-à-vis the current legal framework. In addition, the EDPS welcomes the Proposal's recognition that Regulation (EC) No 45/2001 applies to all data processing activities carried out in the context of OLAF investigations.

However, the EDPS is concerned by the fact that most of the proposed amendments do not reach the minimum data protection standards contained in Regulation (EC) No 45/2001. He is concerned that if the Proposal could be deemed to take precedent over the application of the general data protection framework contained in the Regulation, this would entail an unacceptable watering down of the data protection standards in the context of OLAF investigations. This is particularly worrisome in the light of the sensitive nature of the type of data that may be collected. In order to avoid this outcome, the EDPS requests the Community legislator to take into account the following issues and make the related amendments in the Proposal in order to address them:

1) Shortcomings regarding the right of information: providing information to individuals to ensure fair processing constitutes an indispensable safeguard which should not be unduly compromised. To avoid it, the Proposal should be amended as follows:

• Articles 7a2 first paragraph and 8a should include an explicit reference to Articles 11 and 12 of Regulation (EC) No 45/2001 in order to ensure fair processing;
• the limitation to the right of information of Articles 7a2 first paragraph and 8a second paragraph should be linked to the safeguards of Article 20 of Regulation (EC) No 45/2001.

2) Shortcomings regarding the right of access: a new provision should be added recognising as a general principle the right of access to personal information gathered in the context of OLAF investigations which could be inserted between the first and second paragraph of Article 7a.2. Such a provision could read as follows:

• 'Any person implicated in an investigation has the right to access personal data related to him/her which are gathered in the course of the investigation. Such right(s) may be subject to the limitations foreseen in Article 20 of Regulation (EC) No 45/2001'.

3) Shortcomings regarding the right of rectification: restrictions to the right of rectification should only be provided to the extent that they are permitted under Regulation (EC) No 45/2001. The Proposal contains additional restrictions that should be avoided as follows:

• a provision should be added stating that suspected individuals have a general right to have their views known regarding any piece of information that referred to them, except if an exception under Regulation (EC) No 45/2001 applies. In particular, after having stated that any person implicated in an investigation has 'at any time the right to access personal data related to him/her gathered in the course of the investigation', it should be added that an individual has the subsequent right 'to make his views known on whether the personal data is inaccurate or incomplete';
• the EDPS suggests that the limitation to the right of access and rectification foreseen in Article 7a2, 3rd paragraph be linked to the guarantees of Article 20 Regulation (EC) No 45/2001.

Lastly, the EDPS is also of the view that it would be appropriate for this Proposal to include a new paragraph guaranteeing the confidentiality of whistleblowers.

OPINION OF THE EUROPEAN DATA PROTECTION SUPERVISOR on the proposal for a Regulation of the European Parliament and of the Council amending Regulation (EC) No 1073/1999 concerning investigations conducted by the European Anti-Fraud Office (OLAF) and repealing Regulation (Euratom) No 1074/1999

The proposal was sent by the Council to the EDPS on 8 April 2011.

The importance of the Proposal and the EDPS advice: the Proposal includes provisions which have a strong impact on individuals' rights. OLAF will continue to collect and further process sensitive data relating to suspected offences, offences, criminal convictions as well as information that would serve to exclude individuals from a right, benefit or contract insofar as such information represents a particular risk to the rights and freedoms of the data subjects

The fundamental right to the protection of personal data is relevant not only for its own sake, but also has strong connections with other fundamental rights, such as non-discrimination and due process of law, including the right of defence in OLAF investigations.

The respect of due process has an impact on the validity of evidence and should be considered a priority by OLAF to reinforce its accountability.

It is therefore essential to ensure that, in carrying out its investigations, fundamental rights including the rights to data protection and privacy of the persons implicated therein are properly guaranteed.

The EDPS supports the objectives of the proposed amendments and, in this respect, welcomes the proposal. The EDPS particularly appreciates the introduction of the new Article 7(a) which is dedicated to the procedural guarantees afforded to individuals. In relation to individuals' rights to the protection of their personal data and privacy, the EDPS considers that on the whole the proposal contains improvements vis-à-vis the current situation.

Improving the proposal: despite the overall positive impression, the EDPS considers that from the point of view of the protection of personal data, the proposal could be further improved without jeopardising the objectives that it pursues. In particular, the EDPS is concerned that, because of the lack of coherence on certain aspects, the proposal may be interpreted as a lex specialis regulating the processing of personal data collected in the scope of OLAF investigations, which would take precedence over the application of the general data protection framework contained in Regulation (EC) No 45/2001. Thus, there is a risk that the data protection standards contained in the proposal could be interpreted ex contrario as being lower than those contained in the Regulation.

In order to avoid this outcome, the EDPS provides an analysis of the proposal which, on the one hand, describes its shortcomings and, on the other hand, suggests specific ways to improve upon them. The EDPS would also like to highlight a number of shortcomings that should be addressed by the modification of the text, and most importantly, the Proposal should:

• clearly mention the right to information of the different categories of data subjects, as well as the right of access and rectification in relation to all the phases of the investigations carried out by OLAF;
• clarify the relationship between the need for confidentiality of the investigations and the data protection regime applicable during the investigations: the EDPS suggests that the rights of the data subjects should be clearly defined and separated as well as possible exceptions due to confidentiality requirements, and that the safeguards provided for by Article 20 of Regulation (EC) No 45/2001 should be explicitly introduced;
• clarify OLAF's information policy to the public in relation to data protection;
• introduce specific provisions for the confidentiality of whistleblowers and informants;
• clarify the general data protection principles on the basis of which OLAF can transmit and receive information, including personal data, with other EU bodies and agencies, third countries and international organisations;

Strategic planning: besides all the specific points mentioned above, the EDPS would like to encourage the Commission to propose a more open approach to the EU data protection regime by OLAF. It would be the right moment for OLAF to develop a strategic planning of its data protection compliance by voluntarily clarifying the practical approach to the treatment of its numerous files containing personal data.

Accordingly, the EDPA suggests that the provisions of the Proposal should give the Director- General the task of ensuring that a strategic and comprehensive overview of the different processing operations of OLAF is carried out, kept up to date and made transparent, or at least that the need for this should be explained in a recital.

OPINION OF THE EUROPEAN DATA PROTECTION SUPERVISOR on the proposal for a Regulation of the European Parliament and of the Council amending Regulation (EC) No 1073/1999 concerning investigations conducted by the European Anti-Fraud Office (OLAF) and repealing Regulation (Euratom) No 1074/1999

The proposal was sent by the Council to the EDPS on 8 April 2011.

The importance of the Proposal and the EDPS advice: the Proposal includes provisions which have a strong impact on individuals' rights. OLAF will continue to collect and further process sensitive data relating to suspected offences, offences, criminal convictions as well as information that would serve to exclude individuals from a right, benefit or contract insofar as such information represents a particular risk to the rights and freedoms of the data subjects

The fundamental right to the protection of personal data is relevant not only for its own sake, but also has strong connections with other fundamental rights, such as non-discrimination and due process of law, including the right of defence in OLAF investigations.

The respect of due process has an impact on the validity of evidence and should be considered a priority by OLAF to reinforce its accountability.

It is therefore essential to ensure that, in carrying out its investigations, fundamental rights including the rights to data protection and privacy of the persons implicated therein are properly guaranteed.

The EDPS supports the objectives of the proposed amendments and, in this respect, welcomes the proposal. The EDPS particularly appreciates the introduction of the new Article 7(a) which is dedicated to the procedural guarantees afforded to individuals. In relation to individuals' rights to the protection of their personal data and privacy, the EDPS considers that on the whole the proposal contains improvements vis-à-vis the current situation.

Improving the proposal: despite the overall positive impression, the EDPS considers that from the point of view of the protection of personal data, the proposal could be further improved without jeopardising the objectives that it pursues. In particular, the EDPS is concerned that, because of the lack of coherence on certain aspects, the proposal may be interpreted as a lex specialis regulating the processing of personal data collected in the scope of OLAF investigations, which would take precedence over the application of the general data protection framework contained in Regulation (EC) No 45/2001. Thus, there is a risk that the data protection standards contained in the proposal could be interpreted ex contrario as being lower than those contained in the Regulation.

In order to avoid this outcome, the EDPS provides an analysis of the proposal which, on the one hand, describes its shortcomings and, on the other hand, suggests specific ways to improve upon them. The EDPS would also like to highlight a number of shortcomings that should be addressed by the modification of the text, and most importantly, the Proposal should:

• clearly mention the right to information of the different categories of data subjects, as well as the right of access and rectification in relation to all the phases of the investigations carried out by OLAF;
• clarify the relationship between the need for confidentiality of the investigations and the data protection regime applicable during the investigations: the EDPS suggests that the rights of the data subjects should be clearly defined and separated as well as possible exceptions due to confidentiality requirements, and that the safeguards provided for by Article 20 of Regulation (EC) No 45/2001 should be explicitly introduced;
• clarify OLAF's information policy to the public in relation to data protection;
• introduce specific provisions for the confidentiality of whistleblowers and informants;
• clarify the general data protection principles on the basis of which OLAF can transmit and receive information, including personal data, with other EU bodies and agencies, third countries and international organisations;

Strategic planning: besides all the specific points mentioned above, the EDPS would like to encourage the Commission to propose a more open approach to the EU data protection regime by OLAF. It would be the right moment for OLAF to develop a strategic planning of its data protection compliance by voluntarily clarifying the practical approach to the treatment of its numerous files containing personal data.

Accordingly, the EDPA suggests that the provisions of the Proposal should give the Director- General the task of ensuring that a strategic and comprehensive overview of the different processing operations of OLAF is carried out, kept up to date and made transparent, or at least that the need for this should be explained in a recital.

COURT OF AUDITORS OPINION No 6/2011 (pursuant to Article 325 TFEU) on the amended proposal for a Regulation of the European Parliament and of the Council amending  Regulation (EC) No 1073/1999 concerning investigations conducted by the European Anti-Fraud Office (OLAF) and repealing Regulation (Euratom) No 1074/1999

The Court of Auditors notes that the political guidelines formulated by the Commission's President to the effect that OLAF should be given full independence outside the Commission have not been addressed. On the contrary, the draft Commission decision reinforces the Commission's role in the process of selecting OLAF's Director- General and restricts the Director-General's appointing-authority powers with regard to the Office's staff The Court's observations take into account the recommendations made in previous opinions (see summary of 6/12/2006) of the Court as well as the findings of the audit of the Office, as set out in Special Report No 2/2011.

General observations

A need to simplify and consolidate anti-fraud legislation: the Court regrets that the Commission has not followed up the Court's repeated recommendation to simplify and consolidate the anti-fraud legislation currently in force and to address weaknesses in OLAF's powers and procedures in this context. Any such recasting should include the OLAF Regulation, Council Regulation No 2988/95 on the protection of the European Communities' financial interests and Council Regulation No 2185/96 concerning the on-the-spot checks and inspections carried out by the Commission. Without such a recasting, legal certainty is undermined due to the coexistence of overlapping, incoherent or even incompatible provisions which are difficult to understand and apply.

A need to clearly define the notion of 'financial interests of the Union': the Court reiterates its recommendation that the notion of 'the financial interests of the Union' which is central to all anti-fraud legislation should be clearly defined, and amended in the light of recent jurisprudence. Furthermore, it draws attention to the need to amend Council Regulation No 2988/95 in connection with the fight against VAT fraud. 

A need for independent control of the legality of investigations in progress: the Court appreciates the proposal to introduce provisions for procedural guarantees and takes note of the proposal for an internal review procedure. It regrets, however, that the objective of independent control of the legality of investigative acts in progress will not be achieved under the Commission proposal. For such a control to be effective it must be carried out by a body or a person independent of OLAF which has the power to issue binding opinions. This control of investigative acts in progress is particularly necessary for cases where the persons concerned are not informed that they are subject to an investigation in order to preserve its confidentiality.

A need for effective and equivalent protection of financial interests: the new Article 325(4) TFEU now explicitly requires the European Parliament and the Council to adopt the necessary measures with a view to affording effective and equivalent protection of the financial interests of the Union in all the Union's institutions, bodies, offices and agencies. Currently OLAF's investigations are subject to differing conditions laid down in individual internal decisions by the Union's institutions, bodies, offices and agencies. The Court believes that such internal decisions may not necessarily be justifiable in all cases and may result in limiting the scope of OLAF's investigative activities and so jeopardising the effective and equivalent protection of the financial interests of the Union.

A need for clear rules to investigate serious misconduct in non-financial matters: since it is based on Article 325 TFEU, the scope of the OLAF Regulation is limited to investigations concerned with irregularities affecting the financial interests of the Union. There is a need for clear rules to investigate internal cases of serious misconduct which do not concern the financial interests of the Union but are liable to result in disciplinary and/or criminal proceedings, or in proceedings before the European Court of Justice. Existing legislation in this respect is very succinct and applies only to staff concerned by the Staff Regulations and the Conditions of Employment of Other Servants of the EU. The Court believes that the legislator ought to consider what options are available under the Treaty in order to ensure that all cases of serious misconduct are properly investigated.

A need to keep the text concise, clear and consistent: the Court considers that, taken as a whole, the amendments fail to ensure that the provisions of the OLAF Regulation are as concise, clear and consistent as possible. An example in this respect is the use of the terms 'the Office' and 'the Director-General of the Office' which does not seem to follow any particular logic and is further complicated by the introduction of specific provisions for delegating the Director-General's powers to other staff of the Office. The Court gives other examples of vague wording and unclear drafting.

Specific observations

Priority of the core investigative function: the Court recommends that a new wording of the OLAF Regulation should clearly stress the priority of OLAF's core investigative function over other tasks. OLAF's effectiveness critically depends on devoting a greater share of its resources to investigative activities.

Clarification of key notions needed: the proposal is incomplete as it does not correctly define all the required terms and certain definitions, such as "administrative investigation" require amendment.

Amendments to Regulation (EC) No 2185/96 are required, in order for it to be consistent with the proposal, which extends the use that can be made of the procedures laid down in Regulation No 2185/96 to a number of situations which are not envisaged in the Regulation.

Clarifying the importance of the Staff Regulations for internal investigations: the Court recommends that text on internal investigations should contain a clear reference to the Staff Regulations given their importance for OLAF's internal investigations.

Avoiding confusion with regard to the opening of investigations: the proposed text on the opening of investigations contains complicated provisions that are vaguely worded, and need to be clarified, with particular references to the time frames proposed.

Reinforcing procedural guarantees: the Court makes several recommendations particularly with regard to the rights of witnesses who are interviewed.

Internal review procedure: the Court considers that the required complete independence in the post is not guaranteed as those entrusted with the review procedure remain under the authority of the Director-General. Furthermore, it is not clear whether, and when, the Supervisory Committee will receive copies of the opinion which the person in charge of a review of a case has submitted to the Director-General and of the reasoned reply which has been sent to the person concerned.

The Court suggests creating the function of a review officer, who should neither be appointed by the Director-General nor be subject to his authority.

Cooperation with Eurojust, Europol and international organisations: the Court recommends that objective criteria should be introduced to identify appropriate cases for collaboration, similar to those contained in the 'Practical Agreement on arrangements of cooperation between Eurojust and OLAF'.

Clarifying the role of the Supervisory Committee: the Court recommends that the Committee's monitoring should extend to exchanges of information between the Office and the authorities of the Member States, including the exchange of information through Eurojust. It also recommends clarification that the Committee needs access to OLAF's case files in order to be able to detect instances of interference with the Office's independence.

The 'exchange of views procedure' may undermine investigative independence: such a procedure could be perceived as undermining the independence of the Director-General in defining the investigative priorities of the Office. Furthermore, such a procedure could evolve into a kind of de facto governing board of the Office without the responsibilities of those participating in it being clearly defined and without any indication of the procedural framework for such an exercise.

Clarifying the role of the Director-General: the Court sees no valid reasons for the Commission's proposal to delete from the text the obligation to report to the Court of Auditors on the findings of investigations carried out by the Office. It also draws attention to the risk that certain provisions in the proposal might result in diluting key responsibilities of the Director-General.

COURT OF AUDITORS OPINION No 6/2011 (pursuant to Article 325 TFEU) on the amended proposal for a Regulation of the European Parliament and of the Council amending  Regulation (EC) No 1073/1999 concerning investigations conducted by the European Anti-Fraud Office (OLAF) and repealing Regulation (Euratom) No 1074/1999

The Court of Auditors notes that the political guidelines formulated by the Commission's President to the effect that OLAF should be given full independence outside the Commission have not been addressed. On the contrary, the draft Commission decision reinforces the Commission's role in the process of selecting OLAF's Director- General and restricts the Director-General's appointing-authority powers with regard to the Office's staff The Court's observations take into account the recommendations made in previous opinions (see summary of 6/12/2006) of the Court as well as the findings of the audit of the Office, as set out in Special Report No 2/2011.

General observations

A need to simplify and consolidate anti-fraud legislation: the Court regrets that the Commission has not followed up the Court's repeated recommendation to simplify and consolidate the anti-fraud legislation currently in force and to address weaknesses in OLAF's powers and procedures in this context. Any such recasting should include the OLAF Regulation, Council Regulation No 2988/95 on the protection of the European Communities' financial interests and Council Regulation No 2185/96 concerning the on-the-spot checks and inspections carried out by the Commission. Without such a recasting, legal certainty is undermined due to the coexistence of overlapping, incoherent or even incompatible provisions which are difficult to understand and apply.

A need to clearly define the notion of 'financial interests of the Union': the Court reiterates its recommendation that the notion of 'the financial interests of the Union' which is central to all anti-fraud legislation should be clearly defined, and amended in the light of recent jurisprudence. Furthermore, it draws attention to the need to amend Council Regulation No 2988/95 in connection with the fight against VAT fraud. 

A need for independent control of the legality of investigations in progress: the Court appreciates the proposal to introduce provisions for procedural guarantees and takes note of the proposal for an internal review procedure. It regrets, however, that the objective of independent control of the legality of investigative acts in progress will not be achieved under the Commission proposal. For such a control to be effective it must be carried out by a body or a person independent of OLAF which has the power to issue binding opinions. This control of investigative acts in progress is particularly necessary for cases where the persons concerned are not informed that they are subject to an investigation in order to preserve its confidentiality.

A need for effective and equivalent protection of financial interests: the new Article 325(4) TFEU now explicitly requires the European Parliament and the Council to adopt the necessary measures with a view to affording effective and equivalent protection of the financial interests of the Union in all the Union's institutions, bodies, offices and agencies. Currently OLAF's investigations are subject to differing conditions laid down in individual internal decisions by the Union's institutions, bodies, offices and agencies. The Court believes that such internal decisions may not necessarily be justifiable in all cases and may result in limiting the scope of OLAF's investigative activities and so jeopardising the effective and equivalent protection of the financial interests of the Union.

A need for clear rules to investigate serious misconduct in non-financial matters: since it is based on Article 325 TFEU, the scope of the OLAF Regulation is limited to investigations concerned with irregularities affecting the financial interests of the Union. There is a need for clear rules to investigate internal cases of serious misconduct which do not concern the financial interests of the Union but are liable to result in disciplinary and/or criminal proceedings, or in proceedings before the European Court of Justice. Existing legislation in this respect is very succinct and applies only to staff concerned by the Staff Regulations and the Conditions of Employment of Other Servants of the EU. The Court believes that the legislator ought to consider what options are available under the Treaty in order to ensure that all cases of serious misconduct are properly investigated.

A need to keep the text concise, clear and consistent: the Court considers that, taken as a whole, the amendments fail to ensure that the provisions of the OLAF Regulation are as concise, clear and consistent as possible. An example in this respect is the use of the terms 'the Office' and 'the Director-General of the Office' which does not seem to follow any particular logic and is further complicated by the introduction of specific provisions for delegating the Director-General's powers to other staff of the Office. The Court gives other examples of vague wording and unclear drafting.

Specific observations

Priority of the core investigative function: the Court recommends that a new wording of the OLAF Regulation should clearly stress the priority of OLAF's core investigative function over other tasks. OLAF's effectiveness critically depends on devoting a greater share of its resources to investigative activities.

Clarification of key notions needed: the proposal is incomplete as it does not correctly define all the required terms and certain definitions, such as "administrative investigation" require amendment.

Amendments to Regulation (EC) No 2185/96 are required, in order for it to be consistent with the proposal, which extends the use that can be made of the procedures laid down in Regulation No 2185/96 to a number of situations which are not envisaged in the Regulation.

Clarifying the importance of the Staff Regulations for internal investigations: the Court recommends that text on internal investigations should contain a clear reference to the Staff Regulations given their importance for OLAF's internal investigations.

Avoiding confusion with regard to the opening of investigations: the proposed text on the opening of investigations contains complicated provisions that are vaguely worded, and need to be clarified, with particular references to the time frames proposed.

Reinforcing procedural guarantees: the Court makes several recommendations particularly with regard to the rights of witnesses who are interviewed.

Internal review procedure: the Court considers that the required complete independence in the post is not guaranteed as those entrusted with the review procedure remain under the authority of the Director-General. Furthermore, it is not clear whether, and when, the Supervisory Committee will receive copies of the opinion which the person in charge of a review of a case has submitted to the Director-General and of the reasoned reply which has been sent to the person concerned.

The Court suggests creating the function of a review officer, who should neither be appointed by the Director-General nor be subject to his authority.

Cooperation with Eurojust, Europol and international organisations: the Court recommends that objective criteria should be introduced to identify appropriate cases for collaboration, similar to those contained in the 'Practical Agreement on arrangements of cooperation between Eurojust and OLAF'.

Clarifying the role of the Supervisory Committee: the Court recommends that the Committee's monitoring should extend to exchanges of information between the Office and the authorities of the Member States, including the exchange of information through Eurojust. It also recommends clarification that the Committee needs access to OLAF's case files in order to be able to detect instances of interference with the Office's independence.

The 'exchange of views procedure' may undermine investigative independence: such a procedure could be perceived as undermining the independence of the Director-General in defining the investigative priorities of the Office. Furthermore, such a procedure could evolve into a kind of de facto governing board of the Office without the responsibilities of those participating in it being clearly defined and without any indication of the procedural framework for such an exercise.

Clarifying the role of the Director-General: the Court sees no valid reasons for the Commission's proposal to delete from the text the obligation to report to the Court of Auditors on the findings of investigations carried out by the Office. It also draws attention to the risk that certain provisions in the proposal might result in diluting key responsibilities of the Director-General.

OPINION OF THE EUROPEAN DATA PROTECTION SUPERVISOR on the Proposal for a Regulation of the European Parliament and of the Council amending Regulation (EC) No 1073/1999 concerning investigations conducted by the European Anti-Fraud Office (OLAF).

This Proposal contains revisions to most of the articles of Regulation (EC) No 1073/1999, which sets forth the operational rules to be followed by those involved in OLAF investigations and, as such, constitutes the legal basis for OLAF's operational activities.

The EDPS welcomes this Proposal insofar as it makes more explicit the procedural guarantees of individuals concerned by OLAF investigations, including the protection of personal data of such individuals. From the perspective of the protection of individuals' rights to the protection of their personal data and privacy, the EDPS considers that, for the most part, the Proposal contains improvements vis-à-vis the current legal framework. In addition, the EDPS welcomes the Proposal's recognition that Regulation (EC) No 45/2001 applies to all data processing activities carried out in the context of OLAF investigations.

However, the EDPS is concerned by the fact that most of the proposed amendments do not reach the minimum data protection standards contained in Regulation (EC) No 45/2001. He is concerned that if the Proposal could be deemed to take precedent over the application of the general data protection framework contained in the Regulation, this would entail an unacceptable watering down of the data protection standards in the context of OLAF investigations. This is particularly worrisome in the light of the sensitive nature of the type of data that may be collected. In order to avoid this outcome, the EDPS requests the Community legislator to take into account the following issues and make the related amendments in the Proposal in order to address them:

1) Shortcomings regarding the right of information: providing information to individuals to ensure fair processing constitutes an indispensable safeguard which should not be unduly compromised. To avoid it, the Proposal should be amended as follows:

• Articles 7a2 first paragraph and 8a should include an explicit reference to Articles 11 and 12 of Regulation (EC) No 45/2001 in order to ensure fair processing;
• the limitation to the right of information of Articles 7a2 first paragraph and 8a second paragraph should be linked to the safeguards of Article 20 of Regulation (EC) No 45/2001.

2) Shortcomings regarding the right of access: a new provision should be added recognising as a general principle the right of access to personal information gathered in the context of OLAF investigations which could be inserted between the first and second paragraph of Article 7a.2. Such a provision could read as follows:

• 'Any person implicated in an investigation has the right to access personal data related to him/her which are gathered in the course of the investigation. Such right(s) may be subject to the limitations foreseen in Article 20 of Regulation (EC) No 45/2001'.

3) Shortcomings regarding the right of rectification: restrictions to the right of rectification should only be provided to the extent that they are permitted under Regulation (EC) No 45/2001. The Proposal contains additional restrictions that should be avoided as follows:

• a provision should be added stating that suspected individuals have a general right to have their views known regarding any piece of information that referred to them, except if an exception under Regulation (EC) No 45/2001 applies. In particular, after having stated that any person implicated in an investigation has 'at any time the right to access personal data related to him/her gathered in the course of the investigation', it should be added that an individual has the subsequent right 'to make his views known on whether the personal data is inaccurate or incomplete';
• the EDPS suggests that the limitation to the right of access and rectification foreseen in Article 7a2, 3rd paragraph be linked to the guarantees of Article 20 Regulation (EC) No 45/2001.

Lastly, the EDPS is also of the view that it would be appropriate for this Proposal to include a new paragraph guaranteeing the confidentiality of whistleblowers.

OPINION OF THE EUROPEAN DATA PROTECTION SUPERVISOR on the Proposal for a Regulation of the European Parliament and of the Council amending Regulation (EC) No 1073/1999 concerning investigations conducted by the European Anti-Fraud Office (OLAF).

This Proposal contains revisions to most of the articles of Regulation (EC) No 1073/1999, which sets forth the operational rules to be followed by those involved in OLAF investigations and, as such, constitutes the legal basis for OLAF's operational activities.

The EDPS welcomes this Proposal insofar as it makes more explicit the procedural guarantees of individuals concerned by OLAF investigations, including the protection of personal data of such individuals. From the perspective of the protection of individuals' rights to the protection of their personal data and privacy, the EDPS considers that, for the most part, the Proposal contains improvements vis-à-vis the current legal framework. In addition, the EDPS welcomes the Proposal's recognition that Regulation (EC) No 45/2001 applies to all data processing activities carried out in the context of OLAF investigations.

However, the EDPS is concerned by the fact that most of the proposed amendments do not reach the minimum data protection standards contained in Regulation (EC) No 45/2001. He is concerned that if the Proposal could be deemed to take precedent over the application of the general data protection framework contained in the Regulation, this would entail an unacceptable watering down of the data protection standards in the context of OLAF investigations. This is particularly worrisome in the light of the sensitive nature of the type of data that may be collected. In order to avoid this outcome, the EDPS requests the Community legislator to take into account the following issues and make the related amendments in the Proposal in order to address them:

1) Shortcomings regarding the right of information: providing information to individuals to ensure fair processing constitutes an indispensable safeguard which should not be unduly compromised. To avoid it, the Proposal should be amended as follows:

• Articles 7a2 first paragraph and 8a should include an explicit reference to Articles 11 and 12 of Regulation (EC) No 45/2001 in order to ensure fair processing;
• the limitation to the right of information of Articles 7a2 first paragraph and 8a second paragraph should be linked to the safeguards of Article 20 of Regulation (EC) No 45/2001.

2) Shortcomings regarding the right of access: a new provision should be added recognising as a general principle the right of access to personal information gathered in the context of OLAF investigations which could be inserted between the first and second paragraph of Article 7a.2. Such a provision could read as follows:

• 'Any person implicated in an investigation has the right to access personal data related to him/her which are gathered in the course of the investigation. Such right(s) may be subject to the limitations foreseen in Article 20 of Regulation (EC) No 45/2001'.

3) Shortcomings regarding the right of rectification: restrictions to the right of rectification should only be provided to the extent that they are permitted under Regulation (EC) No 45/2001. The Proposal contains additional restrictions that should be avoided as follows:

• a provision should be added stating that suspected individuals have a general right to have their views known regarding any piece of information that referred to them, except if an exception under Regulation (EC) No 45/2001 applies. In particular, after having stated that any person implicated in an investigation has 'at any time the right to access personal data related to him/her gathered in the course of the investigation', it should be added that an individual has the subsequent right 'to make his views known on whether the personal data is inaccurate or incomplete';
• the EDPS suggests that the limitation to the right of access and rectification foreseen in Article 7a2, 3rd paragraph be linked to the guarantees of Article 20 Regulation (EC) No 45/2001.

Lastly, the EDPS is also of the view that it would be appropriate for this Proposal to include a new paragraph guaranteeing the confidentiality of whistleblowers.

OPINION OF THE EUROPEAN DATA PROTECTION SUPERVISOR on the proposal for a Regulation of the European Parliament and of the Council amending Regulation (EC) No 1073/1999 concerning investigations conducted by the European Anti-Fraud Office (OLAF) and repealing Regulation (Euratom) No 1074/1999

The proposal was sent by the Council to the EDPS on 8 April 2011.

The importance of the Proposal and the EDPS advice: the Proposal includes provisions which have a strong impact on individuals' rights. OLAF will continue to collect and further process sensitive data relating to suspected offences, offences, criminal convictions as well as information that would serve to exclude individuals from a right, benefit or contract insofar as such information represents a particular risk to the rights and freedoms of the data subjects

The fundamental right to the protection of personal data is relevant not only for its own sake, but also has strong connections with other fundamental rights, such as non-discrimination and due process of law, including the right of defence in OLAF investigations.

The respect of due process has an impact on the validity of evidence and should be considered a priority by OLAF to reinforce its accountability.

It is therefore essential to ensure that, in carrying out its investigations, fundamental rights including the rights to data protection and privacy of the persons implicated therein are properly guaranteed.

The EDPS supports the objectives of the proposed amendments and, in this respect, welcomes the proposal. The EDPS particularly appreciates the introduction of the new Article 7(a) which is dedicated to the procedural guarantees afforded to individuals. In relation to individuals' rights to the protection of their personal data and privacy, the EDPS considers that on the whole the proposal contains improvements vis-à-vis the current situation.

Improving the proposal: despite the overall positive impression, the EDPS considers that from the point of view of the protection of personal data, the proposal could be further improved without jeopardising the objectives that it pursues. In particular, the EDPS is concerned that, because of the lack of coherence on certain aspects, the proposal may be interpreted as a lex specialis regulating the processing of personal data collected in the scope of OLAF investigations, which would take precedence over the application of the general data protection framework contained in Regulation (EC) No 45/2001. Thus, there is a risk that the data protection standards contained in the proposal could be interpreted ex contrario as being lower than those contained in the Regulation.

In order to avoid this outcome, the EDPS provides an analysis of the proposal which, on the one hand, describes its shortcomings and, on the other hand, suggests specific ways to improve upon them. The EDPS would also like to highlight a number of shortcomings that should be addressed by the modification of the text, and most importantly, the Proposal should:

• clearly mention the right to information of the different categories of data subjects, as well as the right of access and rectification in relation to all the phases of the investigations carried out by OLAF;
• clarify the relationship between the need for confidentiality of the investigations and the data protection regime applicable during the investigations: the EDPS suggests that the rights of the data subjects should be clearly defined and separated as well as possible exceptions due to confidentiality requirements, and that the safeguards provided for by Article 20 of Regulation (EC) No 45/2001 should be explicitly introduced;
• clarify OLAF's information policy to the public in relation to data protection;
• introduce specific provisions for the confidentiality of whistleblowers and informants;
• clarify the general data protection principles on the basis of which OLAF can transmit and receive information, including personal data, with other EU bodies and agencies, third countries and international organisations;

Strategic planning: besides all the specific points mentioned above, the EDPS would like to encourage the Commission to propose a more open approach to the EU data protection regime by OLAF. It would be the right moment for OLAF to develop a strategic planning of its data protection compliance by voluntarily clarifying the practical approach to the treatment of its numerous files containing personal data.

Accordingly, the EDPA suggests that the provisions of the Proposal should give the Director- General the task of ensuring that a strategic and comprehensive overview of the different processing operations of OLAF is carried out, kept up to date and made transparent, or at least that the need for this should be explained in a recital.

OPINION OF THE EUROPEAN DATA PROTECTION SUPERVISOR on the proposal for a Regulation of the European Parliament and of the Council amending Regulation (EC) No 1073/1999 concerning investigations conducted by the European Anti-Fraud Office (OLAF) and repealing Regulation (Euratom) No 1074/1999

The proposal was sent by the Council to the EDPS on 8 April 2011.

The importance of the Proposal and the EDPS advice: the Proposal includes provisions which have a strong impact on individuals' rights. OLAF will continue to collect and further process sensitive data relating to suspected offences, offences, criminal convictions as well as information that would serve to exclude individuals from a right, benefit or contract insofar as such information represents a particular risk to the rights and freedoms of the data subjects

The fundamental right to the protection of personal data is relevant not only for its own sake, but also has strong connections with other fundamental rights, such as non-discrimination and due process of law, including the right of defence in OLAF investigations.

The respect of due process has an impact on the validity of evidence and should be considered a priority by OLAF to reinforce its accountability.

It is therefore essential to ensure that, in carrying out its investigations, fundamental rights including the rights to data protection and privacy of the persons implicated therein are properly guaranteed.

The EDPS supports the objectives of the proposed amendments and, in this respect, welcomes the proposal. The EDPS particularly appreciates the introduction of the new Article 7(a) which is dedicated to the procedural guarantees afforded to individuals. In relation to individuals' rights to the protection of their personal data and privacy, the EDPS considers that on the whole the proposal contains improvements vis-à-vis the current situation.

Improving the proposal: despite the overall positive impression, the EDPS considers that from the point of view of the protection of personal data, the proposal could be further improved without jeopardising the objectives that it pursues. In particular, the EDPS is concerned that, because of the lack of coherence on certain aspects, the proposal may be interpreted as a lex specialis regulating the processing of personal data collected in the scope of OLAF investigations, which would take precedence over the application of the general data protection framework contained in Regulation (EC) No 45/2001. Thus, there is a risk that the data protection standards contained in the proposal could be interpreted ex contrario as being lower than those contained in the Regulation.

In order to avoid this outcome, the EDPS provides an analysis of the proposal which, on the one hand, describes its shortcomings and, on the other hand, suggests specific ways to improve upon them. The EDPS would also like to highlight a number of shortcomings that should be addressed by the modification of the text, and most importantly, the Proposal should:

• clearly mention the right to information of the different categories of data subjects, as well as the right of access and rectification in relation to all the phases of the investigations carried out by OLAF;
• clarify the relationship between the need for confidentiality of the investigations and the data protection regime applicable during the investigations: the EDPS suggests that the rights of the data subjects should be clearly defined and separated as well as possible exceptions due to confidentiality requirements, and that the safeguards provided for by Article 20 of Regulation (EC) No 45/2001 should be explicitly introduced;
• clarify OLAF's information policy to the public in relation to data protection;
• introduce specific provisions for the confidentiality of whistleblowers and informants;
• clarify the general data protection principles on the basis of which OLAF can transmit and receive information, including personal data, with other EU bodies and agencies, third countries and international organisations;

Strategic planning: besides all the specific points mentioned above, the EDPS would like to encourage the Commission to propose a more open approach to the EU data protection regime by OLAF. It would be the right moment for OLAF to develop a strategic planning of its data protection compliance by voluntarily clarifying the practical approach to the treatment of its numerous files containing personal data.

Accordingly, the EDPA suggests that the provisions of the Proposal should give the Director- General the task of ensuring that a strategic and comprehensive overview of the different processing operations of OLAF is carried out, kept up to date and made transparent, or at least that the need for this should be explained in a recital.

COURT OF AUDITORS OPINION No 6/2011 (pursuant to Article 325 TFEU) on the amended proposal for a Regulation of the European Parliament and of the Council amending  Regulation (EC) No 1073/1999 concerning investigations conducted by the European Anti-Fraud Office (OLAF) and repealing Regulation (Euratom) No 1074/1999

The Court of Auditors notes that the political guidelines formulated by the Commission's President to the effect that OLAF should be given full independence outside the Commission have not been addressed. On the contrary, the draft Commission decision reinforces the Commission's role in the process of selecting OLAF's Director- General and restricts the Director-General's appointing-authority powers with regard to the Office's staff The Court's observations take into account the recommendations made in previous opinions (see summary of 6/12/2006) of the Court as well as the findings of the audit of the Office, as set out in Special Report No 2/2011.

General observations

A need to simplify and consolidate anti-fraud legislation: the Court regrets that the Commission has not followed up the Court's repeated recommendation to simplify and consolidate the anti-fraud legislation currently in force and to address weaknesses in OLAF's powers and procedures in this context. Any such recasting should include the OLAF Regulation, Council Regulation No 2988/95 on the protection of the European Communities' financial interests and Council Regulation No 2185/96 concerning the on-the-spot checks and inspections carried out by the Commission. Without such a recasting, legal certainty is undermined due to the coexistence of overlapping, incoherent or even incompatible provisions which are difficult to understand and apply.

A need to clearly define the notion of 'financial interests of the Union': the Court reiterates its recommendation that the notion of 'the financial interests of the Union' which is central to all anti-fraud legislation should be clearly defined, and amended in the light of recent jurisprudence. Furthermore, it draws attention to the need to amend Council Regulation No 2988/95 in connection with the fight against VAT fraud. 

A need for independent control of the legality of investigations in progress: the Court appreciates the proposal to introduce provisions for procedural guarantees and takes note of the proposal for an internal review procedure. It regrets, however, that the objective of independent control of the legality of investigative acts in progress will not be achieved under the Commission proposal. For such a control to be effective it must be carried out by a body or a person independent of OLAF which has the power to issue binding opinions. This control of investigative acts in progress is particularly necessary for cases where the persons concerned are not informed that they are subject to an investigation in order to preserve its confidentiality.

A need for effective and equivalent protection of financial interests: the new Article 325(4) TFEU now explicitly requires the European Parliament and the Council to adopt the necessary measures with a view to affording effective and equivalent protection of the financial interests of the Union in all the Union's institutions, bodies, offices and agencies. Currently OLAF's investigations are subject to differing conditions laid down in individual internal decisions by the Union's institutions, bodies, offices and agencies. The Court believes that such internal decisions may not necessarily be justifiable in all cases and may result in limiting the scope of OLAF's investigative activities and so jeopardising the effective and equivalent protection of the financial interests of the Union.

A need for clear rules to investigate serious misconduct in non-financial matters: since it is based on Article 325 TFEU, the scope of the OLAF Regulation is limited to investigations concerned with irregularities affecting the financial interests of the Union. There is a need for clear rules to investigate internal cases of serious misconduct which do not concern the financial interests of the Union but are liable to result in disciplinary and/or criminal proceedings, or in proceedings before the European Court of Justice. Existing legislation in this respect is very succinct and applies only to staff concerned by the Staff Regulations and the Conditions of Employment of Other Servants of the EU. The Court believes that the legislator ought to consider what options are available under the Treaty in order to ensure that all cases of serious misconduct are properly investigated.

A need to keep the text concise, clear and consistent: the Court considers that, taken as a whole, the amendments fail to ensure that the provisions of the OLAF Regulation are as concise, clear and consistent as possible. An example in this respect is the use of the terms 'the Office' and 'the Director-General of the Office' which does not seem to follow any particular logic and is further complicated by the introduction of specific provisions for delegating the Director-General's powers to other staff of the Office. The Court gives other examples of vague wording and unclear drafting.

Specific observations

Priority of the core investigative function: the Court recommends that a new wording of the OLAF Regulation should clearly stress the priority of OLAF's core investigative function over other tasks. OLAF's effectiveness critically depends on devoting a greater share of its resources to investigative activities.

Clarification of key notions needed: the proposal is incomplete as it does not correctly define all the required terms and certain definitions, such as "administrative investigation" require amendment.

Amendments to Regulation (EC) No 2185/96 are required, in order for it to be consistent with the proposal, which extends the use that can be made of the procedures laid down in Regulation No 2185/96 to a number of situations which are not envisaged in the Regulation.

Clarifying the importance of the Staff Regulations for internal investigations: the Court recommends that text on internal investigations should contain a clear reference to the Staff Regulations given their importance for OLAF's internal investigations.

Avoiding confusion with regard to the opening of investigations: the proposed text on the opening of investigations contains complicated provisions that are vaguely worded, and need to be clarified, with particular references to the time frames proposed.

Reinforcing procedural guarantees: the Court makes several recommendations particularly with regard to the rights of witnesses who are interviewed.

Internal review procedure: the Court considers that the required complete independence in the post is not guaranteed as those entrusted with the review procedure remain under the authority of the Director-General. Furthermore, it is not clear whether, and when, the Supervisory Committee will receive copies of the opinion which the person in charge of a review of a case has submitted to the Director-General and of the reasoned reply which has been sent to the person concerned.

The Court suggests creating the function of a review officer, who should neither be appointed by the Director-General nor be subject to his authority.

Cooperation with Eurojust, Europol and international organisations: the Court recommends that objective criteria should be introduced to identify appropriate cases for collaboration, similar to those contained in the 'Practical Agreement on arrangements of cooperation between Eurojust and OLAF'.

Clarifying the role of the Supervisory Committee: the Court recommends that the Committee's monitoring should extend to exchanges of information between the Office and the authorities of the Member States, including the exchange of information through Eurojust. It also recommends clarification that the Committee needs access to OLAF's case files in order to be able to detect instances of interference with the Office's independence.

The 'exchange of views procedure' may undermine investigative independence: such a procedure could be perceived as undermining the independence of the Director-General in defining the investigative priorities of the Office. Furthermore, such a procedure could evolve into a kind of de facto governing board of the Office without the responsibilities of those participating in it being clearly defined and without any indication of the procedural framework for such an exercise.

Clarifying the role of the Director-General: the Court sees no valid reasons for the Commission's proposal to delete from the text the obligation to report to the Court of Auditors on the findings of investigations carried out by the Office. It also draws attention to the risk that certain provisions in the proposal might result in diluting key responsibilities of the Director-General.

COURT OF AUDITORS OPINION No 6/2011 (pursuant to Article 325 TFEU) on the amended proposal for a Regulation of the European Parliament and of the Council amending  Regulation (EC) No 1073/1999 concerning investigations conducted by the European Anti-Fraud Office (OLAF) and repealing Regulation (Euratom) No 1074/1999

The Court of Auditors notes that the political guidelines formulated by the Commission's President to the effect that OLAF should be given full independence outside the Commission have not been addressed. On the contrary, the draft Commission decision reinforces the Commission's role in the process of selecting OLAF's Director- General and restricts the Director-General's appointing-authority powers with regard to the Office's staff The Court's observations take into account the recommendations made in previous opinions (see summary of 6/12/2006) of the Court as well as the findings of the audit of the Office, as set out in Special Report No 2/2011.

General observations

A need to simplify and consolidate anti-fraud legislation: the Court regrets that the Commission has not followed up the Court's repeated recommendation to simplify and consolidate the anti-fraud legislation currently in force and to address weaknesses in OLAF's powers and procedures in this context. Any such recasting should include the OLAF Regulation, Council Regulation No 2988/95 on the protection of the European Communities' financial interests and Council Regulation No 2185/96 concerning the on-the-spot checks and inspections carried out by the Commission. Without such a recasting, legal certainty is undermined due to the coexistence of overlapping, incoherent or even incompatible provisions which are difficult to understand and apply.

A need to clearly define the notion of 'financial interests of the Union': the Court reiterates its recommendation that the notion of 'the financial interests of the Union' which is central to all anti-fraud legislation should be clearly defined, and amended in the light of recent jurisprudence. Furthermore, it draws attention to the need to amend Council Regulation No 2988/95 in connection with the fight against VAT fraud. 

A need for independent control of the legality of investigations in progress: the Court appreciates the proposal to introduce provisions for procedural guarantees and takes note of the proposal for an internal review procedure. It regrets, however, that the objective of independent control of the legality of investigative acts in progress will not be achieved under the Commission proposal. For such a control to be effective it must be carried out by a body or a person independent of OLAF which has the power to issue binding opinions. This control of investigative acts in progress is particularly necessary for cases where the persons concerned are not informed that they are subject to an investigation in order to preserve its confidentiality.

A need for effective and equivalent protection of financial interests: the new Article 325(4) TFEU now explicitly requires the European Parliament and the Council to adopt the necessary measures with a view to affording effective and equivalent protection of the financial interests of the Union in all the Union's institutions, bodies, offices and agencies. Currently OLAF's investigations are subject to differing conditions laid down in individual internal decisions by the Union's institutions, bodies, offices and agencies. The Court believes that such internal decisions may not necessarily be justifiable in all cases and may result in limiting the scope of OLAF's investigative activities and so jeopardising the effective and equivalent protection of the financial interests of the Union.

A need for clear rules to investigate serious misconduct in non-financial matters: since it is based on Article 325 TFEU, the scope of the OLAF Regulation is limited to investigations concerned with irregularities affecting the financial interests of the Union. There is a need for clear rules to investigate internal cases of serious misconduct which do not concern the financial interests of the Union but are liable to result in disciplinary and/or criminal proceedings, or in proceedings before the European Court of Justice. Existing legislation in this respect is very succinct and applies only to staff concerned by the Staff Regulations and the Conditions of Employment of Other Servants of the EU. The Court believes that the legislator ought to consider what options are available under the Treaty in order to ensure that all cases of serious misconduct are properly investigated.

A need to keep the text concise, clear and consistent: the Court considers that, taken as a whole, the amendments fail to ensure that the provisions of the OLAF Regulation are as concise, clear and consistent as possible. An example in this respect is the use of the terms 'the Office' and 'the Director-General of the Office' which does not seem to follow any particular logic and is further complicated by the introduction of specific provisions for delegating the Director-General's powers to other staff of the Office. The Court gives other examples of vague wording and unclear drafting.

Specific observations

Priority of the core investigative function: the Court recommends that a new wording of the OLAF Regulation should clearly stress the priority of OLAF's core investigative function over other tasks. OLAF's effectiveness critically depends on devoting a greater share of its resources to investigative activities.

Clarification of key notions needed: the proposal is incomplete as it does not correctly define all the required terms and certain definitions, such as "administrative investigation" require amendment.

Amendments to Regulation (EC) No 2185/96 are required, in order for it to be consistent with the proposal, which extends the use that can be made of the procedures laid down in Regulation No 2185/96 to a number of situations which are not envisaged in the Regulation.

Clarifying the importance of the Staff Regulations for internal investigations: the Court recommends that text on internal investigations should contain a clear reference to the Staff Regulations given their importance for OLAF's internal investigations.

Avoiding confusion with regard to the opening of investigations: the proposed text on the opening of investigations contains complicated provisions that are vaguely worded, and need to be clarified, with particular references to the time frames proposed.

Reinforcing procedural guarantees: the Court makes several recommendations particularly with regard to the rights of witnesses who are interviewed.

Internal review procedure: the Court considers that the required complete independence in the post is not guaranteed as those entrusted with the review procedure remain under the authority of the Director-General. Furthermore, it is not clear whether, and when, the Supervisory Committee will receive copies of the opinion which the person in charge of a review of a case has submitted to the Director-General and of the reasoned reply which has been sent to the person concerned.

The Court suggests creating the function of a review officer, who should neither be appointed by the Director-General nor be subject to his authority.

Cooperation with Eurojust, Europol and international organisations: the Court recommends that objective criteria should be introduced to identify appropriate cases for collaboration, similar to those contained in the 'Practical Agreement on arrangements of cooperation between Eurojust and OLAF'.

Clarifying the role of the Supervisory Committee: the Court recommends that the Committee's monitoring should extend to exchanges of information between the Office and the authorities of the Member States, including the exchange of information through Eurojust. It also recommends clarification that the Committee needs access to OLAF's case files in order to be able to detect instances of interference with the Office's independence.

The 'exchange of views procedure' may undermine investigative independence: such a procedure could be perceived as undermining the independence of the Director-General in defining the investigative priorities of the Office. Furthermore, such a procedure could evolve into a kind of de facto governing board of the Office without the responsibilities of those participating in it being clearly defined and without any indication of the procedural framework for such an exercise.

Clarifying the role of the Director-General: the Court sees no valid reasons for the Commission's proposal to delete from the text the obligation to report to the Court of Auditors on the findings of investigations carried out by the Office. It also draws attention to the risk that certain provisions in the proposal might result in diluting key responsibilities of the Director-General.

OPINION OF THE EUROPEAN DATA PROTECTION SUPERVISOR on the Proposal for a Regulation of the European Parliament and of the Council amending Regulation (EC) No 1073/1999 concerning investigations conducted by the European Anti-Fraud Office (OLAF).

This Proposal contains revisions to most of the articles of Regulation (EC) No 1073/1999, which sets forth the operational rules to be followed by those involved in OLAF investigations and, as such, constitutes the legal basis for OLAF's operational activities.

The EDPS welcomes this Proposal insofar as it makes more explicit the procedural guarantees of individuals concerned by OLAF investigations, including the protection of personal data of such individuals. From the perspective of the protection of individuals' rights to the protection of their personal data and privacy, the EDPS considers that, for the most part, the Proposal contains improvements vis-à-vis the current legal framework. In addition, the EDPS welcomes the Proposal's recognition that Regulation (EC) No 45/2001 applies to all data processing activities carried out in the context of OLAF investigations.

However, the EDPS is concerned by the fact that most of the proposed amendments do not reach the minimum data protection standards contained in Regulation (EC) No 45/2001. He is concerned that if the Proposal could be deemed to take precedent over the application of the general data protection framework contained in the Regulation, this would entail an unacceptable watering down of the data protection standards in the context of OLAF investigations. This is particularly worrisome in the light of the sensitive nature of the type of data that may be collected. In order to avoid this outcome, the EDPS requests the Community legislator to take into account the following issues and make the related amendments in the Proposal in order to address them:

1) Shortcomings regarding the right of information: providing information to individuals to ensure fair processing constitutes an indispensable safeguard which should not be unduly compromised. To avoid it, the Proposal should be amended as follows:

• Articles 7a2 first paragraph and 8a should include an explicit reference to Articles 11 and 12 of Regulation (EC) No 45/2001 in order to ensure fair processing;
• the limitation to the right of information of Articles 7a2 first paragraph and 8a second paragraph should be linked to the safeguards of Article 20 of Regulation (EC) No 45/2001.

2) Shortcomings regarding the right of access: a new provision should be added recognising as a general principle the right of access to personal information gathered in the context of OLAF investigations which could be inserted between the first and second paragraph of Article 7a.2. Such a provision could read as follows:

• 'Any person implicated in an investigation has the right to access personal data related to him/her which are gathered in the course of the investigation. Such right(s) may be subject to the limitations foreseen in Article 20 of Regulation (EC) No 45/2001'.

3) Shortcomings regarding the right of rectification: restrictions to the right of rectification should only be provided to the extent that they are permitted under Regulation (EC) No 45/2001. The Proposal contains additional restrictions that should be avoided as follows:

• a provision should be added stating that suspected individuals have a general right to have their views known regarding any piece of information that referred to them, except if an exception under Regulation (EC) No 45/2001 applies. In particular, after having stated that any person implicated in an investigation has 'at any time the right to access personal data related to him/her gathered in the course of the investigation', it should be added that an individual has the subsequent right 'to make his views known on whether the personal data is inaccurate or incomplete';
• the EDPS suggests that the limitation to the right of access and rectification foreseen in Article 7a2, 3rd paragraph be linked to the guarantees of Article 20 Regulation (EC) No 45/2001.

Lastly, the EDPS is also of the view that it would be appropriate for this Proposal to include a new paragraph guaranteeing the confidentiality of whistleblowers.

OPINION OF THE EUROPEAN DATA PROTECTION SUPERVISOR on the Proposal for a Regulation of the European Parliament and of the Council amending Regulation (EC) No 1073/1999 concerning investigations conducted by the European Anti-Fraud Office (OLAF).

This Proposal contains revisions to most of the articles of Regulation (EC) No 1073/1999, which sets forth the operational rules to be followed by those involved in OLAF investigations and, as such, constitutes the legal basis for OLAF's operational activities.

The EDPS welcomes this Proposal insofar as it makes more explicit the procedural guarantees of individuals concerned by OLAF investigations, including the protection of personal data of such individuals. From the perspective of the protection of individuals' rights to the protection of their personal data and privacy, the EDPS considers that, for the most part, the Proposal contains improvements vis-à-vis the current legal framework. In addition, the EDPS welcomes the Proposal's recognition that Regulation (EC) No 45/2001 applies to all data processing activities carried out in the context of OLAF investigations.

However, the EDPS is concerned by the fact that most of the proposed amendments do not reach the minimum data protection standards contained in Regulation (EC) No 45/2001. He is concerned that if the Proposal could be deemed to take precedent over the application of the general data protection framework contained in the Regulation, this would entail an unacceptable watering down of the data protection standards in the context of OLAF investigations. This is particularly worrisome in the light of the sensitive nature of the type of data that may be collected. In order to avoid this outcome, the EDPS requests the Community legislator to take into account the following issues and make the related amendments in the Proposal in order to address them:

1) Shortcomings regarding the right of information: providing information to individuals to ensure fair processing constitutes an indispensable safeguard which should not be unduly compromised. To avoid it, the Proposal should be amended as follows:

• Articles 7a2 first paragraph and 8a should include an explicit reference to Articles 11 and 12 of Regulation (EC) No 45/2001 in order to ensure fair processing;
• the limitation to the right of information of Articles 7a2 first paragraph and 8a second paragraph should be linked to the safeguards of Article 20 of Regulation (EC) No 45/2001.

2) Shortcomings regarding the right of access: a new provision should be added recognising as a general principle the right of access to personal information gathered in the context of OLAF investigations which could be inserted between the first and second paragraph of Article 7a.2. Such a provision could read as follows:

• 'Any person implicated in an investigation has the right to access personal data related to him/her which are gathered in the course of the investigation. Such right(s) may be subject to the limitations foreseen in Article 20 of Regulation (EC) No 45/2001'.

3) Shortcomings regarding the right of rectification: restrictions to the right of rectification should only be provided to the extent that they are permitted under Regulation (EC) No 45/2001. The Proposal contains additional restrictions that should be avoided as follows:

• a provision should be added stating that suspected individuals have a general right to have their views known regarding any piece of information that referred to them, except if an exception under Regulation (EC) No 45/2001 applies. In particular, after having stated that any person implicated in an investigation has 'at any time the right to access personal data related to him/her gathered in the course of the investigation', it should be added that an individual has the subsequent right 'to make his views known on whether the personal data is inaccurate or incomplete';
• the EDPS suggests that the limitation to the right of access and rectification foreseen in Article 7a2, 3rd paragraph be linked to the guarantees of Article 20 Regulation (EC) No 45/2001.

Lastly, the EDPS is also of the view that it would be appropriate for this Proposal to include a new paragraph guaranteeing the confidentiality of whistleblowers.

OPINION OF THE EUROPEAN DATA PROTECTION SUPERVISOR on the proposal for a Regulation of the European Parliament and of the Council amending Regulation (EC) No 1073/1999 concerning investigations conducted by the European Anti-Fraud Office (OLAF) and repealing Regulation (Euratom) No 1074/1999

The proposal was sent by the Council to the EDPS on 8 April 2011.

The importance of the Proposal and the EDPS advice: the Proposal includes provisions which have a strong impact on individuals' rights. OLAF will continue to collect and further process sensitive data relating to suspected offences, offences, criminal convictions as well as information that would serve to exclude individuals from a right, benefit or contract insofar as such information represents a particular risk to the rights and freedoms of the data subjects

The fundamental right to the protection of personal data is relevant not only for its own sake, but also has strong connections with other fundamental rights, such as non-discrimination and due process of law, including the right of defence in OLAF investigations.

The respect of due process has an impact on the validity of evidence and should be considered a priority by OLAF to reinforce its accountability.

It is therefore essential to ensure that, in carrying out its investigations, fundamental rights including the rights to data protection and privacy of the persons implicated therein are properly guaranteed.

The EDPS supports the objectives of the proposed amendments and, in this respect, welcomes the proposal. The EDPS particularly appreciates the introduction of the new Article 7(a) which is dedicated to the procedural guarantees afforded to individuals. In relation to individuals' rights to the protection of their personal data and privacy, the EDPS considers that on the whole the proposal contains improvements vis-à-vis the current situation.

Improving the proposal: despite the overall positive impression, the EDPS considers that from the point of view of the protection of personal data, the proposal could be further improved without jeopardising the objectives that it pursues. In particular, the EDPS is concerned that, because of the lack of coherence on certain aspects, the proposal may be interpreted as a lex specialis regulating the processing of personal data collected in the scope of OLAF investigations, which would take precedence over the application of the general data protection framework contained in Regulation (EC) No 45/2001. Thus, there is a risk that the data protection standards contained in the proposal could be interpreted ex contrario as being lower than those contained in the Regulation.

In order to avoid this outcome, the EDPS provides an analysis of the proposal which, on the one hand, describes its shortcomings and, on the other hand, suggests specific ways to improve upon them. The EDPS would also like to highlight a number of shortcomings that should be addressed by the modification of the text, and most importantly, the Proposal should:

• clearly mention the right to information of the different categories of data subjects, as well as the right of access and rectification in relation to all the phases of the investigations carried out by OLAF;
• clarify the relationship between the need for confidentiality of the investigations and the data protection regime applicable during the investigations: the EDPS suggests that the rights of the data subjects should be clearly defined and separated as well as possible exceptions due to confidentiality requirements, and that the safeguards provided for by Article 20 of Regulation (EC) No 45/2001 should be explicitly introduced;
• clarify OLAF's information policy to the public in relation to data protection;
• introduce specific provisions for the confidentiality of whistleblowers and informants;
• clarify the general data protection principles on the basis of which OLAF can transmit and receive information, including personal data, with other EU bodies and agencies, third countries and international organisations;

Strategic planning: besides all the specific points mentioned above, the EDPS would like to encourage the Commission to propose a more open approach to the EU data protection regime by OLAF. It would be the right moment for OLAF to develop a strategic planning of its data protection compliance by voluntarily clarifying the practical approach to the treatment of its numerous files containing personal data.

Accordingly, the EDPA suggests that the provisions of the Proposal should give the Director- General the task of ensuring that a strategic and comprehensive overview of the different processing operations of OLAF is carried out, kept up to date and made transparent, or at least that the need for this should be explained in a recital.

OPINION OF THE EUROPEAN DATA PROTECTION SUPERVISOR on the proposal for a Regulation of the European Parliament and of the Council amending Regulation (EC) No 1073/1999 concerning investigations conducted by the European Anti-Fraud Office (OLAF) and repealing Regulation (Euratom) No 1074/1999

The proposal was sent by the Council to the EDPS on 8 April 2011.

The importance of the Proposal and the EDPS advice: the Proposal includes provisions which have a strong impact on individuals' rights. OLAF will continue to collect and further process sensitive data relating to suspected offences, offences, criminal convictions as well as information that would serve to exclude individuals from a right, benefit or contract insofar as such information represents a particular risk to the rights and freedoms of the data subjects

The fundamental right to the protection of personal data is relevant not only for its own sake, but also has strong connections with other fundamental rights, such as non-discrimination and due process of law, including the right of defence in OLAF investigations.

The respect of due process has an impact on the validity of evidence and should be considered a priority by OLAF to reinforce its accountability.

It is therefore essential to ensure that, in carrying out its investigations, fundamental rights including the rights to data protection and privacy of the persons implicated therein are properly guaranteed.

The EDPS supports the objectives of the proposed amendments and, in this respect, welcomes the proposal. The EDPS particularly appreciates the introduction of the new Article 7(a) which is dedicated to the procedural guarantees afforded to individuals. In relation to individuals' rights to the protection of their personal data and privacy, the EDPS considers that on the whole the proposal contains improvements vis-à-vis the current situation.

Improving the proposal: despite the overall positive impression, the EDPS considers that from the point of view of the protection of personal data, the proposal could be further improved without jeopardising the objectives that it pursues. In particular, the EDPS is concerned that, because of the lack of coherence on certain aspects, the proposal may be interpreted as a lex specialis regulating the processing of personal data collected in the scope of OLAF investigations, which would take precedence over the application of the general data protection framework contained in Regulation (EC) No 45/2001. Thus, there is a risk that the data protection standards contained in the proposal could be interpreted ex contrario as being lower than those contained in the Regulation.

In order to avoid this outcome, the EDPS provides an analysis of the proposal which, on the one hand, describes its shortcomings and, on the other hand, suggests specific ways to improve upon them. The EDPS would also like to highlight a number of shortcomings that should be addressed by the modification of the text, and most importantly, the Proposal should:

• clearly mention the right to information of the different categories of data subjects, as well as the right of access and rectification in relation to all the phases of the investigations carried out by OLAF;
• clarify the relationship between the need for confidentiality of the investigations and the data protection regime applicable during the investigations: the EDPS suggests that the rights of the data subjects should be clearly defined and separated as well as possible exceptions due to confidentiality requirements, and that the safeguards provided for by Article 20 of Regulation (EC) No 45/2001 should be explicitly introduced;
• clarify OLAF's information policy to the public in relation to data protection;
• introduce specific provisions for the confidentiality of whistleblowers and informants;
• clarify the general data protection principles on the basis of which OLAF can transmit and receive information, including personal data, with other EU bodies and agencies, third countries and international organisations;

Strategic planning: besides all the specific points mentioned above, the EDPS would like to encourage the Commission to propose a more open approach to the EU data protection regime by OLAF. It would be the right moment for OLAF to develop a strategic planning of its data protection compliance by voluntarily clarifying the practical approach to the treatment of its numerous files containing personal data.

Accordingly, the EDPA suggests that the provisions of the Proposal should give the Director- General the task of ensuring that a strategic and comprehensive overview of the different processing operations of OLAF is carried out, kept up to date and made transparent, or at least that the need for this should be explained in a recital.

COURT OF AUDITORS OPINION No 6/2011 (pursuant to Article 325 TFEU) on the amended proposal for a Regulation of the European Parliament and of the Council amending  Regulation (EC) No 1073/1999 concerning investigations conducted by the European Anti-Fraud Office (OLAF) and repealing Regulation (Euratom) No 1074/1999

The Court of Auditors notes that the political guidelines formulated by the Commission's President to the effect that OLAF should be given full independence outside the Commission have not been addressed. On the contrary, the draft Commission decision reinforces the Commission's role in the process of selecting OLAF's Director- General and restricts the Director-General's appointing-authority powers with regard to the Office's staff The Court's observations take into account the recommendations made in previous opinions (see summary of 6/12/2006) of the Court as well as the findings of the audit of the Office, as set out in Special Report No 2/2011.

General observations

A need to simplify and consolidate anti-fraud legislation: the Court regrets that the Commission has not followed up the Court's repeated recommendation to simplify and consolidate the anti-fraud legislation currently in force and to address weaknesses in OLAF's powers and procedures in this context. Any such recasting should include the OLAF Regulation, Council Regulation No 2988/95 on the protection of the European Communities' financial interests and Council Regulation No 2185/96 concerning the on-the-spot checks and inspections carried out by the Commission. Without such a recasting, legal certainty is undermined due to the coexistence of overlapping, incoherent or even incompatible provisions which are difficult to understand and apply.

A need to clearly define the notion of 'financial interests of the Union': the Court reiterates its recommendation that the notion of 'the financial interests of the Union' which is central to all anti-fraud legislation should be clearly defined, and amended in the light of recent jurisprudence. Furthermore, it draws attention to the need to amend Council Regulation No 2988/95 in connection with the fight against VAT fraud. 

A need for independent control of the legality of investigations in progress: the Court appreciates the proposal to introduce provisions for procedural guarantees and takes note of the proposal for an internal review procedure. It regrets, however, that the objective of independent control of the legality of investigative acts in progress will not be achieved under the Commission proposal. For such a control to be effective it must be carried out by a body or a person independent of OLAF which has the power to issue binding opinions. This control of investigative acts in progress is particularly necessary for cases where the persons concerned are not informed that they are subject to an investigation in order to preserve its confidentiality.

A need for effective and equivalent protection of financial interests: the new Article 325(4) TFEU now explicitly requires the European Parliament and the Council to adopt the necessary measures with a view to affording effective and equivalent protection of the financial interests of the Union in all the Union's institutions, bodies, offices and agencies. Currently OLAF's investigations are subject to differing conditions laid down in individual internal decisions by the Union's institutions, bodies, offices and agencies. The Court believes that such internal decisions may not necessarily be justifiable in all cases and may result in limiting the scope of OLAF's investigative activities and so jeopardising the effective and equivalent protection of the financial interests of the Union.

A need for clear rules to investigate serious misconduct in non-financial matters: since it is based on Article 325 TFEU, the scope of the OLAF Regulation is limited to investigations concerned with irregularities affecting the financial interests of the Union. There is a need for clear rules to investigate internal cases of serious misconduct which do not concern the financial interests of the Union but are liable to result in disciplinary and/or criminal proceedings, or in proceedings before the European Court of Justice. Existing legislation in this respect is very succinct and applies only to staff concerned by the Staff Regulations and the Conditions of Employment of Other Servants of the EU. The Court believes that the legislator ought to consider what options are available under the Treaty in order to ensure that all cases of serious misconduct are properly investigated.

A need to keep the text concise, clear and consistent: the Court considers that, taken as a whole, the amendments fail to ensure that the provisions of the OLAF Regulation are as concise, clear and consistent as possible. An example in this respect is the use of the terms 'the Office' and 'the Director-General of the Office' which does not seem to follow any particular logic and is further complicated by the introduction of specific provisions for delegating the Director-General's powers to other staff of the Office. The Court gives other examples of vague wording and unclear drafting.

Specific observations

Priority of the core investigative function: the Court recommends that a new wording of the OLAF Regulation should clearly stress the priority of OLAF's core investigative function over other tasks. OLAF's effectiveness critically depends on devoting a greater share of its resources to investigative activities.

Clarification of key notions needed: the proposal is incomplete as it does not correctly define all the required terms and certain definitions, such as "administrative investigation" require amendment.

Amendments to Regulation (EC) No 2185/96 are required, in order for it to be consistent with the proposal, which extends the use that can be made of the procedures laid down in Regulation No 2185/96 to a number of situations which are not envisaged in the Regulation.

Clarifying the importance of the Staff Regulations for internal investigations: the Court recommends that text on internal investigations should contain a clear reference to the Staff Regulations given their importance for OLAF's internal investigations.

Avoiding confusion with regard to the opening of investigations: the proposed text on the opening of investigations contains complicated provisions that are vaguely worded, and need to be clarified, with particular references to the time frames proposed.

Reinforcing procedural guarantees: the Court makes several recommendations particularly with regard to the rights of witnesses who are interviewed.

Internal review procedure: the Court considers that the required complete independence in the post is not guaranteed as those entrusted with the review procedure remain under the authority of the Director-General. Furthermore, it is not clear whether, and when, the Supervisory Committee will receive copies of the opinion which the person in charge of a review of a case has submitted to the Director-General and of the reasoned reply which has been sent to the person concerned.

The Court suggests creating the function of a review officer, who should neither be appointed by the Director-General nor be subject to his authority.

Cooperation with Eurojust, Europol and international organisations: the Court recommends that objective criteria should be introduced to identify appropriate cases for collaboration, similar to those contained in the 'Practical Agreement on arrangements of cooperation between Eurojust and OLAF'.

Clarifying the role of the Supervisory Committee: the Court recommends that the Committee's monitoring should extend to exchanges of information between the Office and the authorities of the Member States, including the exchange of information through Eurojust. It also recommends clarification that the Committee needs access to OLAF's case files in order to be able to detect instances of interference with the Office's independence.

The 'exchange of views procedure' may undermine investigative independence: such a procedure could be perceived as undermining the independence of the Director-General in defining the investigative priorities of the Office. Furthermore, such a procedure could evolve into a kind of de facto governing board of the Office without the responsibilities of those participating in it being clearly defined and without any indication of the procedural framework for such an exercise.

Clarifying the role of the Director-General: the Court sees no valid reasons for the Commission's proposal to delete from the text the obligation to report to the Court of Auditors on the findings of investigations carried out by the Office. It also draws attention to the risk that certain provisions in the proposal might result in diluting key responsibilities of the Director-General.

COURT OF AUDITORS OPINION No 6/2011 (pursuant to Article 325 TFEU) on the amended proposal for a Regulation of the European Parliament and of the Council amending  Regulation (EC) No 1073/1999 concerning investigations conducted by the European Anti-Fraud Office (OLAF) and repealing Regulation (Euratom) No 1074/1999

The Court of Auditors notes that the political guidelines formulated by the Commission's President to the effect that OLAF should be given full independence outside the Commission have not been addressed. On the contrary, the draft Commission decision reinforces the Commission's role in the process of selecting OLAF's Director- General and restricts the Director-General's appointing-authority powers with regard to the Office's staff The Court's observations take into account the recommendations made in previous opinions (see summary of 6/12/2006) of the Court as well as the findings of the audit of the Office, as set out in Special Report No 2/2011.

General observations

A need to simplify and consolidate anti-fraud legislation: the Court regrets that the Commission has not followed up the Court's repeated recommendation to simplify and consolidate the anti-fraud legislation currently in force and to address weaknesses in OLAF's powers and procedures in this context. Any such recasting should include the OLAF Regulation, Council Regulation No 2988/95 on the protection of the European Communities' financial interests and Council Regulation No 2185/96 concerning the on-the-spot checks and inspections carried out by the Commission. Without such a recasting, legal certainty is undermined due to the coexistence of overlapping, incoherent or even incompatible provisions which are difficult to understand and apply.

A need to clearly define the notion of 'financial interests of the Union': the Court reiterates its recommendation that the notion of 'the financial interests of the Union' which is central to all anti-fraud legislation should be clearly defined, and amended in the light of recent jurisprudence. Furthermore, it draws attention to the need to amend Council Regulation No 2988/95 in connection with the fight against VAT fraud. 

A need for independent control of the legality of investigations in progress: the Court appreciates the proposal to introduce provisions for procedural guarantees and takes note of the proposal for an internal review procedure. It regrets, however, that the objective of independent control of the legality of investigative acts in progress will not be achieved under the Commission proposal. For such a control to be effective it must be carried out by a body or a person independent of OLAF which has the power to issue binding opinions. This control of investigative acts in progress is particularly necessary for cases where the persons concerned are not informed that they are subject to an investigation in order to preserve its confidentiality.

A need for effective and equivalent protection of financial interests: the new Article 325(4) TFEU now explicitly requires the European Parliament and the Council to adopt the necessary measures with a view to affording effective and equivalent protection of the financial interests of the Union in all the Union's institutions, bodies, offices and agencies. Currently OLAF's investigations are subject to differing conditions laid down in individual internal decisions by the Union's institutions, bodies, offices and agencies. The Court believes that such internal decisions may not necessarily be justifiable in all cases and may result in limiting the scope of OLAF's investigative activities and so jeopardising the effective and equivalent protection of the financial interests of the Union.

A need for clear rules to investigate serious misconduct in non-financial matters: since it is based on Article 325 TFEU, the scope of the OLAF Regulation is limited to investigations concerned with irregularities affecting the financial interests of the Union. There is a need for clear rules to investigate internal cases of serious misconduct which do not concern the financial interests of the Union but are liable to result in disciplinary and/or criminal proceedings, or in proceedings before the European Court of Justice. Existing legislation in this respect is very succinct and applies only to staff concerned by the Staff Regulations and the Conditions of Employment of Other Servants of the EU. The Court believes that the legislator ought to consider what options are available under the Treaty in order to ensure that all cases of serious misconduct are properly investigated.

A need to keep the text concise, clear and consistent: the Court considers that, taken as a whole, the amendments fail to ensure that the provisions of the OLAF Regulation are as concise, clear and consistent as possible. An example in this respect is the use of the terms 'the Office' and 'the Director-General of the Office' which does not seem to follow any particular logic and is further complicated by the introduction of specific provisions for delegating the Director-General's powers to other staff of the Office. The Court gives other examples of vague wording and unclear drafting.

Specific observations

Priority of the core investigative function: the Court recommends that a new wording of the OLAF Regulation should clearly stress the priority of OLAF's core investigative function over other tasks. OLAF's effectiveness critically depends on devoting a greater share of its resources to investigative activities.

Clarification of key notions needed: the proposal is incomplete as it does not correctly define all the required terms and certain definitions, such as "administrative investigation" require amendment.

Amendments to Regulation (EC) No 2185/96 are required, in order for it to be consistent with the proposal, which extends the use that can be made of the procedures laid down in Regulation No 2185/96 to a number of situations which are not envisaged in the Regulation.

Clarifying the importance of the Staff Regulations for internal investigations: the Court recommends that text on internal investigations should contain a clear reference to the Staff Regulations given their importance for OLAF's internal investigations.

Avoiding confusion with regard to the opening of investigations: the proposed text on the opening of investigations contains complicated provisions that are vaguely worded, and need to be clarified, with particular references to the time frames proposed.

Reinforcing procedural guarantees: the Court makes several recommendations particularly with regard to the rights of witnesses who are interviewed.

Internal review procedure: the Court considers that the required complete independence in the post is not guaranteed as those entrusted with the review procedure remain under the authority of the Director-General. Furthermore, it is not clear whether, and when, the Supervisory Committee will receive copies of the opinion which the person in charge of a review of a case has submitted to the Director-General and of the reasoned reply which has been sent to the person concerned.

The Court suggests creating the function of a review officer, who should neither be appointed by the Director-General nor be subject to his authority.

Cooperation with Eurojust, Europol and international organisations: the Court recommends that objective criteria should be introduced to identify appropriate cases for collaboration, similar to those contained in the 'Practical Agreement on arrangements of cooperation between Eurojust and OLAF'.

Clarifying the role of the Supervisory Committee: the Court recommends that the Committee's monitoring should extend to exchanges of information between the Office and the authorities of the Member States, including the exchange of information through Eurojust. It also recommends clarification that the Committee needs access to OLAF's case files in order to be able to detect instances of interference with the Office's independence.

The 'exchange of views procedure' may undermine investigative independence: such a procedure could be perceived as undermining the independence of the Director-General in defining the investigative priorities of the Office. Furthermore, such a procedure could evolve into a kind of de facto governing board of the Office without the responsibilities of those participating in it being clearly defined and without any indication of the procedural framework for such an exercise.

Clarifying the role of the Director-General: the Court sees no valid reasons for the Commission's proposal to delete from the text the obligation to report to the Court of Auditors on the findings of investigations carried out by the Office. It also draws attention to the risk that certain provisions in the proposal might result in diluting key responsibilities of the Director-General.