VAT and customs duties fraud under investigation by the European Public Prosecutor’s Office amounts to €45 billion and is raising concerns over the dominance of Chinese criminal networks, which control the entire fraud chain.
According to official data released today in the 2025 Annual Activity Report of the European Public Prosecutor’s Office (EPPO), the €45.01 billion in VAT and customs fraud represents only 27% of ongoing investigations (981 out of 3,602 cases), but accounts for 67% of the total €67.27 billion in estimated damage to the budgets of the European Union and its Member States.
According to the EPPO, this specific type of crime, which directly affects EU and national revenue sources, reveals “a criminal industry that has been ignored or tolerated for far too long”.
The EPPO has “recently observed an alarmingly high level of fraud orchestrated by large-scale criminal groups related to the import and sale of goods originating outside the EU”, highlighting the growing complexity of these crimes and the high degree of specialization involved, which requires cooperation between criminal groups.
The document explains that these networks exploit supply chains from China, use clandestine banking systems to channel financial flows, and maintain complex operational structures within the EU to manage all stages of criminal activity.
These networks are “widely present in major ports and commercial terminals across Europe, where they seek to control the customs entry process,” the report adds.
Customs control at the EU’s external borders, particularly ports and airports, had already been flagged as a concern in the previous report and remains a specific issue highlighted by Portuguese European Prosecutor José Ranito.
In 2025, one of the EPPO’s largest operations was Operation Calypso, carried out across several countries, targeting the illegal entry of goods from China. At the port of Piraeus alone, 2,435 containers were seized, marking the largest operation of its kind in the EU.
“With regard to the entry of goods into the EU originating from China in particular, criminal networks composed of individuals of Chinese origin have taken control of the entire fraud chain,” the report states.
The EPPO further stresses that this type of crime, which is “difficult to detect from a purely national perspective”, has a significant impact on certain economic sectors, where these groups have “gone beyond mere infiltration”, dominating entire activities and “suffocating legitimate economic operators through unfair competition”.
This highly profitable, low-risk criminal activity is also linked to other high-risk illicit activities, such as drug trafficking and human trafficking, the report adds.
In 2025, the EPPO opened 2,030 new investigations, 35% more than in 2024. Fraud involving subsidies and payments accounts for 68% of ongoing investigations but represents only 27% of the total estimated damage under investigation.
EU Recovery and Resilience Facility programmes account for 512 cases under investigation, representing “a sharp increase compared to 2024 (66.7%)”.
“Due to the high volume of expected disbursements in December 2026, the risk of fraud and corruption remains high,” the report warns.
The document also reports a conviction rate of 95% in court cases and 275 indictments issued in 2025, up 34% from 2024. Judicial authorisations were granted to freeze assets worth €1.13 billion, although only €288.93 million were effectively frozen.
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The EPPO currently includes 24 Member States and operates as an independent and highly specialised public prosecution office.
It began operations on 1 June 2021 and has the authority to investigate, prosecute, bring charges and conduct trials against perpetrators of criminal offences affecting the EU’s financial interests, such as fraud, corruption or cross-border VAT fraud exceeding €10 million.
