AN "Office of the European Director of Public Prosecutions" would be established in Dublin as part of EU proposals for prosecuting fraud against the EU budget, a Dublin conference on fraud heard yesterday.

The commission is considering the establishment of a "European Judicial Space" whereby the territory of the EU would constitute a single legal area for the purposes of prosecuting fraud against the community budget, the High Court judge, Mr Justice Paul Carney, told the conference.

It is understood there is no set date for implementing the proposals drafted by the commission.

Mr Justice Carney is the president of the Irish Association for the Protection of the Financial Interests of the European Communities, which organised the conference.

The head office of a European Director of Public Prosecutions would be set up in Brussels with offices in the capital cities of all member states under the proposals.

"The debate as to whether fraud on the budget is a mere 1 per cent or 10 per cent is ongoing," Mr Justice Carney said.

Traditional methods of co-operation in law enforcement have proved inadequate and the commission is now devoting its attention to the establishment of a prosecutorial and judicial free trade area to be known as the "European judicial space.

In respect of European budgetary crime the judges warrant will run throughout the union.

Market rigging will be a European crime where liable to harm the financial interests of the communities. Community officials will commit community crimes if they engage in corruption or abuse of office. It is proposed that there will be crimes in relation to the budget for misappropriation of funds, disclosure of secrets pertaining to office, money laundering and conspiracy.

The most radical of the "Corpus Juris" proposals is Article 18, Mr Justice Carney said. This "provides that for the purpose of the investigation, prosecution, trial and execution of sentence concerning the new created European budgetary crimes the territory of the member states of the union shall constitute a single legal area".

The European Director of Public Prosecutions will look for evidence of both innocence as well as guilt in cases of alleged crimes against the budget.

Budgetary crimes being prosecuted by the office will be tried by a national independent court appointed by the member state.

Suspects and accused will have the protection of the European Convention of Human Rights together with such body of statute and case law as exists in the relevant member state.