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Circumvention of sanctions will become an “EU crime”

The amendments to the EU treaties proposed by the European Commission in May 2022 are aimed at introducing a unified criminalization in the EU of sanctions infringement or evasion activities. A draft law adapting Polish law to the postulated changes has just been put on the government work agenda.

Circumventing sanctions like terrorism

The EU’s restrictive measures (sanctions) are one of the primary tools for promoting the objectives of the Common Foreign and Security Policy, as set out in Article 21 of the TEU. However, it is the responsibility of individual member states to implement and enforce them. Different countries provide for various penalties and punishments for violators, which weakens the power of sanctions on a European scale. Therefore, in May 2022, the European Commission proposed that, in order to ensure uniform standards for criminal law responses to violations of EU restrictive measures across the European Union, an EU-wide directive on criminal sanctions for violations of EU restrictive measures should be adopted. Such a measure, however, will require an amendment to Article 83 of the Treaty on the Functioning of the European Union (TFEU), which provides for a common Union criminal policy for only certain categories of cases, such as terrorism or human trafficking. The amendment of Article 83 of the TFEU requires the approval of the European Parliament (which has already been given) and unanimity in the EU Council, expressed in the form of a decision. This procedure has never been used before.

Housing price spikes

The authors of the report noted that, when comparing data from mid-2021 to mid-2022, the average price increase was 10 % (the highest since 2007). Price increases were recorded in all cities surveyed, with the exception of Paris, Stockholm, and Hong Kong. At the same time, price increases are not in line with local wages, and household debt is steadily increasing. All this may indicate that the property market is “overheated” and a painful correction for owners and investors is about to take place.

Polish law will be amended

The list of government legislative works has published information on the procedure of the draft amendments to the polish Law on International Agreements. As explained by the author of the draft, the amendment is aimed at creating the necessary conditions on the Polish side for expressing consent to the transfer of competence to the European Union resulting from the content of the Council’s decision to add violations of EU restrictive measures to the areas of crime specified in Article 83(1) of the (TFEU). Its adoption will enable a simplified procedure for consenting to changes in EU criminal policy.

A directive is the next step

Following the expansion of the catalog of euro crimes to include offenses related to the circumvention or violation of sanctions, the European Commission will propose, by way of a directive, minimum standards for defining offenses and penalties for the violation of EU sanctions, which will then be incorporated into the legislation of individual EU countries.

We would like to remind you that specialists from our law firm have been providing specialized counseling in this area since the beginning of the introduction of sanctions, addressed to entrepreneurs and entities operating on the markets in Poland and the European Union.

Author team leader DKP Legal Magdalena Napierała
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