INFORMATION BULLETIN
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1 Introduction This information bulletin gives an overview of the communications that have been sent to OLAF in the first three quarters of Under Regulation (EEC) No. 595/91 Member States are required to report within 2 months of the end of the quarter in which an irregularity was detected and/or new information concerning an irregularity has become known. This implies that Member States had to report before December 1 st 2004 new cases (art. 3 communication) and/or new information concerning cases already reported (art. 5 communication) over the period July 2004 September The information in this bulletin is based on an AFIS/ECR-download of 6 and concerns the period January 2004 September The first information bulletin contained 4 annexes. The aim is to develop a standard information bulletin to inform Member States of the latest trends and developments which will be published within 3 weeks after the end of the period in which Member States had to report. This information bulletin also contains 4 annexes, but the annexes contain different tables than the first information bulletin because the information provided by some Member States was not precise enough to produce the same 4 annexes within the time limit of 3 weeks. Reporting discipline Annex 3 of the Annual Report 2003, the statistical evaluation of irregularities, already noted that the reporting discipline of Member States had improved in This report also acknowledged that further improvements were still necessary and that the level of compliance of a Member State seems to decrease as the total amount of support measures increases. This is still true!! Germany, Spain and France together receive the highest proportion of the EAGGF budget (more than 50%) but their reporting discipline is still poor. The reporting can be improved by following the instructions contained in the manual of AFIS/ECR-module Reg. 595/91 and by comparing new communications with the data on the excel files that Member States regularly receive before sending communications. Italy is one of the Member States that has improved its reporting significantly in the last 2 years. Examples of frequent mistakes are: 1. Wrong or incorrect reference number (field 1.1.) AFIS/ECR-module Reg. 595/91 links all communications that belong to the same irregularity/case on basis of the reference number in field 1.1. A wrong reference number will lead to the creation of a new and double case or, if it is a wrong version number, loss of the new information which means that old data still will be considered as valid. The manual describes very precisely how the reference number should be keyed in. Combining the information in the manual with the information in the excel files should result in faultless reporting. 2. Financial consequences (chapter/screen 6a and 6b) Field 6.3. Actual or potential financial impact of the irregularity should reflect the total amount of the irregularity. Some Member States lower the amount when there has been full or partial recovery. This latter is not correct. Normally, the amount affected by the irregularity stays the same and full or partial recovery does not lead to a change in the total amount of the irregularity.
2 3. Administrative status and financial status (field and field 6.12.) The fields administrative status and field financial status are used to determine the status of an irregularity. Some Member States do not use these fields at all which makes it almost impossible to determine the current situation of a case. It also means that cases are kept open as long as no detailed information is received from a Member State. Some Member States are misusing the code PA (= case dropped). The code PA should only be used in cases where it emerges subsequently that no irregularity has occurred and therefore proceedings have been terminated. Some Member States are using this code in cases in which the amounts can not be recovered due to bankruptcy. In these cases the codes TT = proceedings terminated and IRR = amount irrecoverable should be used. In the last meeting irregularities and mutual assistance agricultural products Member States received an overview, in A3 format, called YEAR 2003: REPORTING DISCIPLINE / % OF INFORMATION PER FIELD. This overview shows that not all Member States fully comply with Reg. 595/91. The situation for the year 2004 is even more worrying. Member States are kindly requested to update the cases reported. Interface facility The new AFIS-kit, which will be released at the end of this year, will offer an interface facility. This facility will make it possible to import and export data in xml format. Member States can use this facility to transfer data from their national systems into AFIS/ECR. It also allows those Member States which are still not using the digital reporting system and which report irregularities by sending communications in excel format, to transfer the data into AFIS/ECR themselves. OLAF will provide all Member States with the necessary technical assistance. The new AFIS-kit will contain a guide how to import and export in xml format. Do not forget: Member States should bear in mind that AFIS/ECR-module Reg. 595/91 should only contain information that was provided by a Member State. The module should not contain information that can only be keyed in after interpretation by OLAF. Annex 1: 2004 cases In this period OLAF received approximately 11,000 communications under Regulation (EEC) No. 595/91. A large number of these communications were updates of cases that were reported before the year In the first 3 quarters of the year, 2,975 new cases concerning the year 2004 were reported. The total amount affected by these 2,975 cases was approximately 56 million. Of this the total amount detected after payment was approximately 50.7 million, of which approximately 6.3 million has been recovered. This implies that approximately 44.4 has still to be recovered. Member States already closed 695 cases. The highest number of cases was from Germany with cases followed by Spain, France, United Kingdom and the Netherlands with 360, 306, 281 and 276 cases respectively. In monetary terms, Spain was the Member State that reported the highest amounts affected by irregularities, i.e. almost 21 million, followed by Germany which reported a total amount of more than 15 million. Some Member States are successful in recovering unduly paid
3 amounts. The recovery rate shows that the United Kingdom, Denmark and Austria perform better than other Member States in this area. Annex 1 gives an overview per Member State of the number of irregularities and the amounts involved. Annex 2: 2004 Cases and year in which the irregularity started In annex 2 an overview is given of the year in which the irregularity started per Member State. One point of concern is that in 458 cases (± 15%) Member States did not report the date on which the irregularity started. Another point of concern is that 702 irregularities (± 25%) started before the year Late discovery does affect the chances of recovery. Annex 3: 2004 Cases and year of discovery Art. 3 of Reg. 595/91 obliges Member States to report the discovery date of an irregularity. Annex 2 gives an overview of all 2004 cases and the year in which these irregularities were discovered. More than 80% of the irregularities were discovered in the period In 189 cases no information was given about the date of discovery. Annex 4: Qualification of irregularities Annex 4 gives an overview of the qualification of the irregularities by Member States. Member States have qualified irregularities in approximately 44% of the cases. This relatively low percentage is strongly influenced by the fact that Germany (1,165 cases) and Spain (360) do not qualify the irregularities. Products involved and type of support measure affected by irregularities In the first information bulletin an overview was given of the products involved and support measures affected by the irregularities. As already mentioned, this information can not be given in this bulletin since some Member States did not fulfil their obligation to report the products involved and measures affected by the irregularities. OLAF would like to provide Member States with the latest trends and developments concerning the products involved and support measures affected by irregularities as soon as possible but cannot do so without the co-operation of Member States. OLAF would like to remind Member States of this obligation. The reporting system offers the possibility to use codes to report the products involved and the measures affected by irregularities. These codes have been created to overcome, for instance, the problem of budget lines that change on a regular basis. Some Member States are not using these codes to report the support measure that was affected by the irregularity but report the number of the budget line for This is only possible if the irregularity concerns the budget year Unfortunately, some Member States are using the budget lines of the year 2004 to report, for instance, irregularities concerning the year This makes it impossible for OLAF to make a proper link between irregularity and support measure, therefore, no information can be given about the support measures affected by the irregularities. It should also not be too difficult to use the first 4 positions of the CN-code (combined nomenclature) to report the goods involved in the irregularities especially since the
4 goods are already summed up in the pick lists. The advice is to use the codes as provided by the module/pick lists. Member States have to submit communications relating to the last quarter of 2004 before 1 March Member States can use the period January February 2005 to improve the quality of the communications already sent. On request, excel files containing the download of 6, can be forwarded to Member States to support them in completing the information concerning irregularities. Member States are advised to use the manual of AFIS/ECR-module Reg. 595/91 which is designed to prevent mistakes and deficits in reporting. Member States are also requested to give feedback on the figures, number of cases and amounts affected by the irregularities, as summed up in the annexes. These figures form the basis of the Annual Report Images say more than words: the annexes give a good impression of the 2004 cases. Written by: Ben van der Fels Intelligence Analyst C1 OLAF\Directorate C\Unit C1\Intelligence: Strategic Assessment & Analysis Telephone: ben.vanderfels@cec.eu.int
5 Annex 1: 2004 cases DESCRIPTION AT BE DE DK ES FIN FR UK GR IE IT LU NL PT SE TOTAL number of cases , , Total EAGGF expenditure 2,769, ,831 38,540, ,807 32,333, ,454,046 4,219, ,770 1,225,912 3,865,396 16,698 5,110,699 60,260,336 1,704, ,016, Amount affected by the irregularities 1,271, ,298 15,217, ,807 20,878, ,574,020 4,014, , ,624 1,779,267 16,698 3,225,462 2,718, ,009 55,849, Amount irregularities detected before payment 865,026 37,913 1,902,422 17,177 21, , , , , , ,905 5,165, Amount irregularities detected after payment 406, ,385 13,315, ,630 20,856, ,102,618 3,715, , ,923 1,387,081 16,698 2,641,923 2,718, ,104 50,684, Amount recovered 221, , , , , ,505 2,310,472 57, , ,243 7, , ,265 91,998 6,332, Balans to recover 184, ,282 12,544, ,453 20,226, ,621,113 1,405, , ,360 1,152,838 9,070 1,889,946 2,550, ,106 44,351, Interest 29,789 63, ,057, , ,414 80, , ,216 2,640, Penalty 205, , ,000 6, , , , , ,077, Amount made available to EAGGF 347, , , ,464 1,118,020 57, , ,040 7, , ,457 45,291 3,109, Amount retained by MS (20% rule) 17,198 28, , , , ,156 6, , , , CoA - Amount charged to MS CoA - Amount charged to EAGGF-budget MS - share in financial sanction EC - share in financial sanction 104, ,330 Recovery rate (=6.4. / ) 54.5% 35.3% 5.8% 58.2% 3.0% 0.0% 15.5% 62.2% 7.4% 31.1% 16.9% 45.7% 28.5% 6.2% 34.4% 12.5% *) amounts in
6 Annex 2: 2004 Cases: year in which the irregularity started YEAR \ MEMBER STATE AT BE DE DK ES FIN FR UK GR IE IT LU NL PT SE TOTAL blank / no information Grand Total , ,975
7 Annex 3: 2004 Cases and year of discovery YEAR \ MEMBER STATE AT BE DE DK ES FIN FR UK GR IE IT LU NL PT SE TOTAL ,741 blank / no information Grand Total , ,975
8 Annex 4: Qualification of irregularities MS IRQ1 IRQ2 IRQ3 (blank) TOTAL error / mistake irregularity suspicion of fraud cases AT BE DE 1,165 1,165 DK ES FIN FR UK GR IE IT LU 3 3 NL PT SE TOTAL 33 1, ,673 2,975
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