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28th May 2022

Commission to propose new EU anti-terrorism tool

  • Swift operating centre: An EU-US agreement allows Swift to transfer bulk banking data to Washington (Photo: SWIFT)

The European Commission will on Wednesday (12 July) suggest that the EU sets up its own financial data analysis system, allowing the EU to stop transferring bulk data to the US for anti-terrorism purposes.

It is set to put forward three options and their corresponding budgets for the establishment of an EU "Terrorism Finance Tracking System" (TFTS), ranging from €33 million to €47 million to set up and another €7 million to €11 million a year to operate, according to a draft proposal seen by EUobserver.

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Having a "legal and technical framework for extraction of data on EU territory" was one of the conditions put by MEPs last year when approving the controversial "Swift agreement."

At the time MEPs only reluctantly endorsed this EU-US data sharing agreement. This legalised a former covert programme established in 2001 which allowed American authorities to secretly go through European bank transactions when searching for terrorism finance leads.

The most expensive option, in the EU commission's view, would also be the broadest in scope: a brand-new Financial Intelligence Unit co-ordination service, at an estimated cost of €47 million to set up and another €11 million a year to maintain.

The searches through bulk data from financial messaging companies such as Swift would be carried out by each national financial unit, except for the EU-related ones or the ones requested by other countries, such as the US, which would be carried out by the "FIU Platform." This would be based either in the Hague, within the premises of the EU police agency Europol or in Tallinn, where the new IT agency for storage of data is being set up.

The second option, for €40.5 million in initial costs and another €9 million each year, would have the system set up in the premises of the Hague-based EU police agency Europol and would not only go through the bulk data for specific leads, but also give an own analysis and match the results with other intelligence. Member states could send their own analysts to 'second' the Europol experts, the draft adds.

Thirdly, the EU commission offers a data-extraction only service, which would also be the cheapest: €33 million to set up and €7 million to maintain. This option would not allow the Europol experts to analyse the search results and compare them with other intelligence when the requests come from other member states. But they would be able to do so when the information is requested by other EU institutions, the US or other countries.

The reflection paper also throws in the possibility of extending the scope of such a programme to money laundering and other forms of organised crime and cover other providers and types of financial messages, as well as expanding to national transactions too, not just international ones.

It concludes that important choices and decisions are still be to be made in respect to fundamental rights, technical and legal limitations and also the fact that the cost of setting it up will have to be covered by the EU's next multi-annual budget, which some member states want trimmed.

Having the cost put on the table before deciding to set up a new tool is a good policy, says Dutch Liberal MEP Sophie in't Veld, who on Tuesday presented her report on how much anti-terrorism programmes cost in the EU.

"It's essential to have these figures now, so that those who want an EU TFTP will have to explain to citizens why it is more important to spend money on these systems instead of healthcare, education, infrastructure," she said.

Noting that in the past 10 years, there was a 20-fold increase in EU funding devoted to anti-terrorism programmes, the Liberal MEP said this trend had to be reversed, especially at a time when budgets are being cut everywhere in Europe.

But she warned against a backdoor policy shift and the establishment of an EU-wide terrorism finance tracking programme.

Her German colleague Alexander Alvaro, who drafted the Parliament's view on the Swift agreement, also said that MEPs had never asked for an EU TFTP.

"What we're calling for is just a software to extract data and punctually send it to US - to avoid the transfer of bulk data. This is a sign of clear deafness from the European Commission," he argued.

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