The European Parliament adopted a legislative resolution approving the Council position at first reading with a view to the adoption of a regulation of the European Parliament and of the Council establishing an exchange, assistance and training programme for the protection of the euro against counterfeiting for the period 2021-2027 (Pericles IV programme) and repealing Regulation (EU) No 331/2014.

The proposed Regulation establishes a programme on exchanges, assistance and training for the protection of the euro against counterfeiting (Pericles IV programme), for the period from 1 January 2021 to 31 December 2027.

Programme’s objectives

The general objective of the programme is to prevent and combat counterfeiting and associated fraud and to preserve the integrity of the euro banknotes and coins, thereby enhancing the confidence of citizens and businesses in their authenticity and thus trust in the EU economy, while ensuring the sustainability of public finances.

The specific objective of the programme is to protect euro banknotes and coins against counterfeiting and related fraud by:

- supporting and supplementing measures taken by Member States, and

- assisting national and EU authorities in their efforts to develop close and regular cooperation and exchange of best practices with each other and with the Commission, involving, where appropriate, third countries and international organisations.

Budget

The financial framework for the implementation of the programme for the period from 1 January 2021 to 31 December 2027 is hereby set at EUR 6 193 284 in current prices.

Implementation of the programme

The programme will be implemented under direct management in accordance with the Financial Regulation. It will be implemented by the Commission in cooperation with the Member States, through regular consultations at different stages of the programme implementation, while ensuring consistency and avoiding overlap with relevant measures taken by other competent bodies, in particular the European Central Bank (ECB) and Europol.

The Council adopted its position at first reading with a view to the adoption of a regulation of the European Parliament and of the Council establishing an exchange, assistance and training programme for the protection of the euro against counterfeiting for the period 2021-2027 (Pericles IV programme) and repealing regulation (EU) No 331/2014.

The proposed Regulation establishes a programme on exchanges, assistance and training for the protection of the euro against counterfeiting (Pericles IV programme), for the period from 1 January 2021 to 31 December 2027.

Objectives

The aim of the Pericles IV programme is to protect euro banknotes and coins against counterfeiting and related fraud by supporting and supplementing the measures undertaken by the Member States and by assisting the national and competent Union authorities in their efforts to develop close and regular cooperation and exchange of best practices with each other and with the Commission, involving, where appropriate, third countries and international organisations.

The Pericles IV programme will replace the Pericles 2020 programme to ensure its continuation beyond 2020.

Budget

The financial envelope for the implementation of the Pericles IV programme for the period from 1 January 2021 to 31 December 2027 is set at EUR 6 193 284 in current prices. The annual appropriations will be authorised by the European Parliament and the Council within the limits of the multiannual financial framework.

Implementation and forms of EU funding

The Pericles IV programme will be implemented by the Commission in cooperation with the Member States, through regular consultations at different stages of the programme's implementation. In preparing the work programmes, the Commission will have to take into account the ongoing and planned activities of the European Central Bank (ECB) and Europol to combat euro counterfeiting and related fraud.

The exchange of information on best practice in the prevention of counterfeiting and fraud involving the euro is one of the actions eligible for financial support. Technical, scientific and operational assistance that appears necessary in the framework of the programme is also eligible, as is the purchase of equipment to be used by specialised anti-counterfeiting authorities of third countries for protecting the euro against counterfeiting.

Co-financing rates

The co-financing rate for grants awarded under the Pericles IV programme shall not exceed 75 % of the eligible costs. In exceptional and duly justified cases, defined in the annual work programmes, the co-financing rate shall not exceed 90 % of the eligible costs.

Work programmes

The work programme should be adopted by means of implementing acts and the Commission could adopt delegated acts to supplement the Regulation in order to develop the provisions for a monitoring and evaluation framework, and to amend the Annex in order to revise and supplement the indicators where necessary for the purpose of evaluation.

Evaluation indicators

The programme would be closely monitored on the basis of the following key indicators:

- the number of counterfeit euros detected;

- the number of illegal workshops dismantled;

- the number of competent authorities applying for the programme;

- the satisfaction rate of participants in actions financed by the programme; and

- feedback from participants who have already taken part in previous Pericles actions on the impact of the programme.

The collection of data for the key performance indicators should be carried out by the Commission and/or the beneficiaries of the programme.

The Council adopted its position at first reading with a view to the adoption of a regulation of the European Parliament and of the Council establishing an exchange, assistance and training programme for the protection of the euro against counterfeiting for the period 2021-2027 (Pericles IV programme) and repealing regulation (EU) No 331/2014.

The proposed Regulation establishes a programme on exchanges, assistance and training for the protection of the euro against counterfeiting (Pericles IV programme), for the period from 1 January 2021 to 31 December 2027.

Objectives

The aim of the Pericles IV programme is to protect euro banknotes and coins against counterfeiting and related fraud by supporting and supplementing the measures undertaken by the Member States and by assisting the national and competent Union authorities in their efforts to develop close and regular cooperation and exchange of best practices with each other and with the Commission, involving, where appropriate, third countries and international organisations.

The Pericles IV programme will replace the Pericles 2020 programme to ensure its continuation beyond 2020.

Budget

The financial envelope for the implementation of the Pericles IV programme for the period from 1 January 2021 to 31 December 2027 is set at EUR 6 193 284 in current prices. The annual appropriations will be authorised by the European Parliament and the Council within the limits of the multiannual financial framework.

Implementation and forms of EU funding

The Pericles IV programme will be implemented by the Commission in cooperation with the Member States, through regular consultations at different stages of the programme's implementation. In preparing the work programmes, the Commission will have to take into account the ongoing and planned activities of the European Central Bank (ECB) and Europol to combat euro counterfeiting and related fraud.

The exchange of information on best practice in the prevention of counterfeiting and fraud involving the euro is one of the actions eligible for financial support. Technical, scientific and operational assistance that appears necessary in the framework of the programme is also eligible, as is the purchase of equipment to be used by specialised anti-counterfeiting authorities of third countries for protecting the euro against counterfeiting.

Co-financing rates

The co-financing rate for grants awarded under the Pericles IV programme shall not exceed 75 % of the eligible costs. In exceptional and duly justified cases, defined in the annual work programmes, the co-financing rate shall not exceed 90 % of the eligible costs.

Work programmes

The work programme should be adopted by means of implementing acts and the Commission could adopt delegated acts to supplement the Regulation in order to develop the provisions for a monitoring and evaluation framework, and to amend the Annex in order to revise and supplement the indicators where necessary for the purpose of evaluation.

Evaluation indicators

The programme would be closely monitored on the basis of the following key indicators:

- the number of counterfeit euros detected;

- the number of illegal workshops dismantled;

- the number of competent authorities applying for the programme;

- the satisfaction rate of participants in actions financed by the programme; and

- feedback from participants who have already taken part in previous Pericles actions on the impact of the programme.

The collection of data for the key performance indicators should be carried out by the Commission and/or the beneficiaries of the programme.

The European Parliament adopted by 593 votes to 29, with 27 abstentions, a legislative resolution on the proposal for a regulation of the European Parliament and of the Council establishing an exchange, assistance and training programme for the protection of the euro against counterfeiting for the period 2021-2027 (Pericles IV programme).

The European Parliament’s position adopted at first reading under the ordinary legislative procedure amended the Commission proposal as follows.

Objective

Parliament stressed that strong protection of the euro against counterfeiting was an essential element of the security and competitiveness of the Union's economy. The programme shall help to prevent and combat counterfeiting and related fraud, thus preserving the integrity of euro banknotes and coins and strengthening the confidence of citizens and businesses in their authenticity and therefore enhancing the trust in the Union’s economy.

Actions to promote the exchange of information shall include, inter alia , best practices in preventing counterfeiting and fraud relating to the euro.

Budget

The financial framework for the implementation of the programme for the period from 1 January 2021 to 31 December 2027 shall be set at EUR 7 700 000 (at current prices).

Strengthening cooperation with the European Central Bank and Europol

In order to ensure consistency and avoid unnecessary overlap with measures taken by other competent entities, the Commission shall take into account the activities of the ECB and Europol in combating euro counterfeiting and fraud when preparing work programmes.

The Commission shall be empowered to adopt delegated acts to adopt work programmes after consulting the experts appointed by each Member State and the representatives of the ECB and Europol.

Indicators

As regards the key performance indicators, Parliament replaced those listed in the Commission proposal (Annex) by a set of indicators directly measuring the effectiveness of the programme´s activities such as:

- the number of Member States and third countries whose competent national authorities have participated in the activities of the programme;

- the number of participants and their satisfaction rate as well as any other feedback they may have given on the usefulness of activities under the programme;

- information provided by the competent national authorities on the number of counterfeit euros detected and illegal workshops dismantled as a direct consequence of improved cooperation through the programme.

The Commission shall provide annually to the European Parliament, the Council, the European Central Bank, Europol, Eurojust and the European Public Prosecutor's Office information on the results of the programme, taking into account the quantitative and qualitative indicators defined in the Annex to the proposal.

Third countries

Counterfeiting hotspots have been detected in third countries and the counterfeiting of the euro is acquiring a growing international dimension. Members suggested capacity building and training activities involving the competent authorities of third countries should be considered essential to achieve the effective protection of the Union´s single currency and should be further encouraged in the context of the programme.

The Committee on Civil Liberties, Justice and Home Affairs adopted the report by Dennis de JONG (S&D, NL) on the proposal for a regulation of the European Parliament and of the Council establishing an exchange, assistance and training programme for the protection of the euro against counterfeiting for the period 2021-2027 (Pericles IV programme).

The committee recommended that the European Parliament's position adopted at first reading under the ordinary legislative procedure should amend the Commission's proposal as follows.

Objective

The programme should help to prevent and combat counterfeiting and related fraud, thus preserving the integrity of euro banknotes and coins and strengthening the confidence of citizens and businesses in their authenticity and therefore enhancing the trust in the Union’s economy, while and securing the sustainability of public finances.

The financial framework for the implementation of the programme for the period from 1 January 2021 to 31 December 2027 shall be set at EUR 7 700 000 (at current prices).

Strengthening cooperation with the European Central Bank and Europol

In order to ensure consistency and avoid unnecessary overlap with measures taken by other competent entities, the Commission shall take into account the activities of the ECB and Europol in combating euro counterfeiting and fraud when preparing work programmes.

The Commission shall be empowered to adopt delegated acts to adopt work programmes after consulting the experts appointed by each Member State and the representatives of the ECB and Europol.

Indicators

As regards the key performance indicators, Members replaced those listed in the Commission proposal (Annex) by a set of indicators directly measuring the effectiveness of the programme´s activities

The Commission shall provide annually to the European Parliament, the Council, the European Central Bank, Europol, Eurojust and the European Public Prosecutor's Office information on the results of the programme, taking into account the quantitative and qualitative indicators defined in the Annex to the proposal.

Opinion of the European Central Bank (ECB) on a proposal for a regulation of the European Parliament and of the Council establishing an exchange, assistance and training programme for the protection of the euro against counterfeiting (the ‘Pericles IV programme’).

The ECB noted that the proposed regulation will replace the legal basis of the current Pericles 2020 programme, from 1 January 2021, in order to continue the Pericles programme to the end of 2027.

It is convinced that the Pericles programme will continue to contribute to preserving the integrity of euro banknotes and in the fight against counterfeiting.

To prepare for the launch of banknotes with upgraded security features, the ECB and the national central banks of the Eurosystem offer a wide range of information to banknote equipment manufacturers and suppliers, as well as commercial banks, retailers and others that use banknote equipment or handle cash on a daily basis. In addition, the ECB provides training programmes and training materials to complement professional cash handlers' training.

Moreover, the ECB analyses new counterfeit types at its Counterfeit Analysis Centre (CAC) and uses the knowledge gained to better advise law enforcement authorities.

In response, the Central Bank Counterfeit Deterrence Group, of which the ECB is a member, supports and uses technologies such as counterfeit deterrence systems, which prevent the capture or reproduction of images of protected banknotes.

The ECB:

- encourages the Commission to fully exploit the ECB's experience in conducting training and providing information on euro banknotes and to provide for the full involvement of the ECB in this respect;

- reiterates its view that it would be beneficial if the Commission liaised with and involved the ECB and Europol when preparing the work programmes to be funded under the programme;

- emphasises the need: (i) for it to be regularly involved in the preparation of the evaluation reports during the programme; (ii) for feedback from entities actively participating in relevant measures alongside the Commission to be appropriately included in the evaluation reports and communications; and (iii) for it to be kept regularly informed in future about the programme;

- wishes to be consulted prior to the adoption of any delegated act provided for in Article 12(2) of the proposed regulation since these are implementing measures for the purpose of protecting the euro against counterfeiting and as such are necessary for the use of the euro as the single currency.

PURPOSE: to establish an exchange, assistance and training programme for the protection of the euro against counterfeiting for the period 2021-2027 (Pericles IV programme).

PROPOSED ACT: Regulation of the European Parliament and of the Council.

ROLE OF THE EUROPEAN PARLIAMENT: the European Parliament decides in accordance with the ordinary legislative procedure and on an equal footing with the Council.

BACKGROUND: the Treaty provides that the European Parliament and the Council are to establish the measures necessary for the use of the euro as the single currency (Article 133 TFEU). Among these measures is the protection of the euro against counterfeiting. On the basis of this article, the protection of the euro as the single currency is the responsibility of the EU.

Counterfeiting of the euro poses a true problem for the Union and for its institutions. Its threats are still substantial , as demonstrated by the increasing availability of high quality counterfeit euro's and security features on the internet/darknet and the existence of counterfeiting hotspots, e.g. in Colombia, Peru and China.

Considering the cross-border circulation of the euro and the deep involvement of international organised crime in euro counterfeiting (production and distribution), it is necessary that national protection frameworks be complemented by an EU initiative to ensure homogeneous national and international cooperation, and to face possible emerging transnational risks.

The current 2020 Pericles programme is specifically dedicated to the protection of euro banknotes and coins against counterfeiting. In the mid-term evaluation of the programme, the Commission came to the conclusion that the continuation of the Pericles 2020 programme beyond 2020 should be supported, given its EU added value, its long-term impact and the sustainability of its actions.

CONTENT: the proposal for a Regulation - presented for a Union of 27 Member States - seeks to establish the Pericles IV programme, an exchange, assistance and training programme for the protection of the euro against counterfeiting . It lays down the objectives of the programme, the budget for the period from 1 January 2021 to 31 December 2027, the forms of Union funding and the rules for providing such funding.

The proposed new programme aims to protect euro banknotes and coins against counterfeiting and related fraud,

by supporting and supplementing the measures undertaken by the Member States and; by assisting the competent national and Union authorities in their efforts to develop among themselves and with the Commission a close and regular cooperation and an exchange of best practice, where appropriate including third countries and international organisations.

In particular, the programme shall take responsibility for tackling specific emerging threats (such as deep/dark web) and the relationship with certain countries (e.g. China), as it is difficult for individual Member States to effectively address these threats on their own.

Implementation : the programme shall be implemented through direct management by the Commission. Financial support for eligible actions shall be granted under the programme in the form of grants or public contracts.

Actions under the programme may be organised jointly by the Commission and other partners having relevant expertise, such as: the national central banks and the European Central Bank (ECB); the National Analysis Centres (NACs) and the Coin National Analysis Centres; the European Technical and Scientific Centre and the mints; Europol, Eurojust and Interpol.

Proposed budget : the programme shall have an overall budget of EUR 7.7 million for the period 2021-2027 . This amount is in line with the Commission proposal for the next multiannual financial framework for the period 2021-2027.