Legislation, enforcement, pursuit and global action approaches: how can tax evasion and money laundering be eradicated?

EU Commissioner Věra Jourová has come under fire by the enquiry committee on the Panama Papers. Apart from that, representatives of European and national agencies were in the EU Parliament on Monday to report on their work with regard to pursuing tax evasion and money laundering. On Wednesday, discussions on global action approaches took place with Professor Joseph Stiglitz.

An intensive debate took place between MEPs and the Commissioner for Justice, Consumers and Gender Equality about the effectiveness of the measures set by the Commission and what steps would be taken next. She defended the current legal framework conditions, which already would be quite strong. For her, in particular the connection between Member States and third countries is still capable of improvement. In addition, an EU-wide register is beeing planned in order to disclose economic beneficiaries.

Last Monday, representatives of EUROPOL, EUROJUST and OLAF also demanded an EU-wide register. The three organisations are dealing with the pursuit and enforcement of money laundering at European level and informed MEPs of their work in connection with the Panama Papers and which loopholes or gaps they are currently confronted with. Giovanni Kessler reported that OLAF was investigating whether the Panama Papers would provide any information concerning the involvement of employees in EU Institutions (which so far has not been the case).

Simon Riodent of EUROPOL talked above all about the problems of the cross-border exchange of information. However, EUROJUST focussed on coordinating national organisations with regard to pursuing money laundering. This represents a challenge in so far as within the Member States, both organisation and responsibility for investigation and pursuit are organised in very different ways. Klaus Meyer-Cabri of EUROJUST pointed out that with regard to cooperating with third countries, the existence of international agreements are very helpful as the diplomatic way would take far too long.

The third session on Wednesday saw an exchange with Prof. Joseph Stiglitz. This week, Professor Stiglitz, together with the Friedrich Ebert Foundation presented a global approach to combat tax avoidance, tax evasion and money laundering. In his opinion, the Panama Papers have clearly shown the extent of the problem. In a world with globally acting stakeholders, States too have to choose global action approaches. In order to drain tax havens and the shadow economy, transparency and the exchange of information are key elements. This includes for example a global public searchable register of all economic beneficiaries. In particular Europe and the USA have to set an example here.

Further information:

No to Tax Havens

The Panama Papers in the enquiry committee of the EU Parliament

Press release on the hearing of Commissioner Věra Jourová

Background information Anti-money laundering and tax evasion: Who assures compliance with the rules and enforces them? English only)

Prof. Stiglitz: Overcoming the Shadow Economy (English only)