EU governments not obliged to cooperate with Panama Papers investigation

MEP inquiry risks upsetting EU’s inter-institutional balance, warns Council legal services.

MEPs are investigating alleged money laundering, tax evasion and avoidance s through the parliamentary inquiry into the Panama Papers | Photo credit: Fotolia

By Martin Banks

Martin Banks is a senior reporter at the Parliament Magazine

06 Feb 2017

A legal row has flared between the European Parliament and EU member states over the special committee set up to investigate the so-called “Panama Papers” scandal.

The parliament’s investigation committee on the Panama Papers (PANA) was launched in July 2016 following the revelation of the Panama Papers, a series of documents exposing the complex financial structures used by certain wealthy people to mask their money in the Central American tax haven.

MEPs on the committee are investigating the ways in which money laundering, tax evasion and tax avoidance are allegedly made possible in the EU.


However, member states – along with the European Commission - were, late last week accused of refusing to release key documents requested by the parliament.

German Greens deputy Sven Giegold, a member of the PANA committee, accused both the council and commission of a “lack of transparency” in declining to cooperate with the inquiry, a situation he described as “unacceptable.”

In a new twist, confidential papers sent by the council, in July last year, have shed new light on the affair. The document, seen by this website, constitutes the opinion from the legal service of the Council.

It was sent to the parliament’s Permanent Representatives Committee and clearly seeks to defend member states’ refusal to release what Giegold described as “sensitive” reports relating to the Panama Papers scandal.

The council paper states, “The parliament decision establishing the committee simply calls on the PANA committee to investigate alleged contraventions, and maladministration in the application of Union law in relation to money laundering, tax avoidance and tax evasion without however making any link between the alleged contraventions and maladministration and the Panama papers case.”

It goes on, “The unspecific and generic character of the facts and of the law on which the parliament decision is based does not allow neither member states nor the council to assess their obligation to participate in the works of the committee of inquiry.”

The council says that “not only does this mandate not specify the relevant facts object of inquiry, it does not specify the member states concerned either.”

It adds, “Thus, any member state could be the subject of an inquiry with regard to any case of money laundering, tax avoidance and tax evasion.”

Parliament’s mandate in setting up PANA, it argues, “does not specify with a sufficient level of precision the facts that are the subject matter of the inquiry.”

By seeking to exercise a “general and unqualified control” over how member states apply their national laws to combat tax evasion, the “role which parliament assigns itself would also risk affecting the inter-institutional balance,” it says.

Despite the council’s legal arguments, Giegold and the Greens said they stood by their decision to “go public” with their complaint.

A Greens/EFA group spokesman said on Friday that in failing to cooperate with the PANA committee both the council and commission were in breach of the principle of ‘sincere cooperation’ enshrined in the EU treaties.

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