Key data
| Regulation | Council Decision (EU) 2026/2244, of 28 September 2026 |
|---|---|
| CELEX Reference | 32026D2244 |
| Publication | 7 October 2026 |
| Entry into force | 28 September 2026 |
| Affected parties | Entities benefiting from European funds, public administrations, companies with public contracts co-financed by the EU |
| Category | Public Sector |
| Body | European Public Prosecutor's Office (EPPO) |
If your company receives European subsidies, manages public contracts co-financed by the EU or participates in structural funds programs, this decision directly affects you. The European Public Prosecutor's Office (EPPO) has just gained investigative muscle with the formal appointment of two new European prosecutors, according to the Council Decision (EU) 2026/2244, of 28 September 2026.
The EPPO is not an administrative control body: it is a prosecutor's office with criminal jurisdiction. It investigates and prosecutes crimes that affect the financial interests of the EU. This means that an irregularity in the management of a subsidy does not end in a return of funds, but potentially in a criminal trial.
What does this regulation establish?
Decision 2026/2244 proceeds with the formal appointment of two European prosecutors within the EPPO. This is an institutional decision that strengthens the operational staff of the body and ensures the continuity of its investigative functions.
The EPPO has jurisdiction to investigate and prosecute the following types of crimes:
- Fraud in EU structural and cohesion funds
- Corruption affecting European financial interests
- Cross-border VAT evasion when the damage exceeds 10 million euros
- Other irregularities that harm the EU budget
With this staffing reinforcement, the EPPO expands its capacity to open and process investigations simultaneously in the Member States where it operates, including Spain.
Economic and operational impact
The impact of this decision is not measured in direct euros for companies, but in risk of criminal and reputational exposure. The greater the operational capacity of the EPPO, the greater the likelihood that irregularities that previously remained in the administrative sphere will escalate to criminal investigations.
The practical consequences for affected organizations include:
- Greater likelihood of criminal investigation in the event of any irregularity in the management of EU funds, even if unintentional.
- Increased compliance costs: companies will need to strengthen their internal control systems, auditing and document traceability.
- Risk of project paralysis if an investigation is opened, with the consequent impact on cash flow and reputation.
- Criminal liability of executives in cases of fraud or gross negligence in the management of subsidies or co-financed contracts.
The consolidation of the EPPO as a fully operational body makes regulatory compliance a first-order business risk variable, especially for SMEs and third-sector entities that manage European funds without robust compliance structures.
Who does it affect?
- Companies benefiting from European subsidies (ERDF, ESF, Horizon Europe, EAGF, EAFRD, etc.)
- Companies awarded public contracts co-financed in whole or in part with EU funds
- Public administrations and managing bodies of European funds (ministries, regional governments, municipalities)
- Third-sector entities and foundations that receive European funding
- Consultancies and management companies that advise on the processing and justification of European subsidies
- Companies with large-volume cross-border VAT operations in several EU countries
Practical example
A Spanish construction company awarded a public works contract co-financed 70% with ERDF funds submits invoices from subcontractors that, following an internal audit by the managing administration, show irregularities in the justified amounts.
Until a few years ago, this type of incident was resolved in the administrative sphere: return of funds, possible penalty and temporary exclusion from future calls. With the EPPO fully operational and strengthened with new prosecutors, the same situation can lead to a criminal investigation for fraud against EU financial interests, with charges against the executives responsible for the economic justification of the project.
The cost is no longer just the return of the subsidy: it can include criminal legal defense, paralysis of activity during the investigation and irreversible reputational damage.
What should companies do now?
- Audit your current exposure: identify all active or recent projects that receive European funding, whether direct or through co-financed public contracts.
- Review document traceability: ensure that all economic justification (invoices, contracts, payments) is complete, consistent and properly archived for the required legal periods.
- Strengthen internal controls: implement or update internal validation procedures before submitting any expense justification to the managing entity.
- Train management personnel: executives and technicians who sign European fund justifications must understand the criminal implications of irregularities, even if unintentional.
- Consult with a European funds compliance specialist: if your company manages relevant volumes of European financing, consider an external review of your control procedures before an inspection arrives.
Frequently asked questions
What is the EPPO and what can it investigate in Spain?
The EPPO (European Public Prosecutor's Office) is the independent EU body with criminal jurisdiction to investigate and prosecute crimes affecting European financial interests. In Spain it can investigate fraud in structural funds (ERDF, ESF, EAGF), corruption linked to EU funds and cross-border VAT evasion when the damage exceeds 10 million euros. Its investigations can lead to criminal trials with charges against natural and legal persons.
What risk does my company face if there are irregularities in a European subsidy?
With the EPPO operational and strengthened, an irregularity in the management of European funds can escalate from an administrative penalty (return of funds) to a criminal investigation. Executives responsible for economic justification can be personally charged. The risk is especially high in cases of irregular invoices, unjustified subcontracting or ineligible expenses presented as eligible.
When did the appointment of the new European prosecutors come into force?
Council Decision (EU) 2026/2244 came into force on 28 September 2026, the date of formal appointment. It was published in the EU Official Journal on 7 October 2026.
Does this decision affect only large companies or also SMEs?
It affects any entity that manages European funds, regardless of size. SMEs and third-sector entities are particularly vulnerable because they usually lack robust compliance structures. If your company receives European subsidies or participates in public contracts co-financed by the EU, you are within the scope of the EPPO.
What types of European funds are under the EPPO's radar?
The EPPO has jurisdiction over all funds that form part of the EU budget: structural and cohesion funds (ERDF, ESF+), agricultural funds (EAGF, EAFRD), the Horizon Europe program, the Recovery and Resilience Mechanism (Next Generation EU funds), and any other European financial instrument. It also investigates cross-border VAT fraud when the damage exceeds 10 million euros.
Official source
Consult full regulation at official source
Disclaimer: This article is for informational purposes only and does not constitute legal advice. For specific decisions, consult a qualified professional. Source: https://eur-lex.europa.eu/./legal-content/AUTO/?uri=CELEX:32026D2244
