In non-conviction-based confiscation (NCBC) proceedings, a court rules to confiscate assets from an individual without a preceding criminal prosecution. Models of NCBC include civil confiscation, where the proceedings follow the civil procedure framework, and ‘criminal’ NCBC, which is closely linked to criminal proceedings. This is initiated only if the alleged perpetrator cannot be prosecuted.

Bypassing fundamental rights

Using the civil framework for confiscation allows for the circumvention of procedural safeguards in criminal proceedings. For instance, the protection of fundamental rights that applies in criminal procedures does not apply to civil confiscation. In civil confiscation, the court uses the standard of proof that is normally used in civil cases. This is in contrast to criminal confiscation, where the court confiscates criminal assets following the conviction of the perpetrator, which requires the criminal standard of proof 'beyond reasonable doubt'.

Lower standard of proof

The civil standard used in civil confiscation is lower than the criminal standard. Under the civil standard, it must be demonstrated that it is likely that the assets were obtained through criminal means. It is therefore sufficient for the judges to determine, on a balance of probabilities, that the assets were obtained through criminal means. In other words, if the judges opt to proceed with confiscation without a conviction, they can do so if the criminal origin of the assets is ‘more probable than not’.

The lower the standard of proof, the easier it is for the state to justify its claim for confiscation. Something else is also at stake: the right to property of the bona fide party. Some scholars have therefore argued that a higher standard of proof urgently needs to be implemented in NCBC procedures.

Indonesia as a case study

In this context, it is interesting to look at Indonesia. A law is being drafted in that country to enable the confiscation of criminally obtained assets through NCBC. Indonesia plans to apply this to a wide range of criminal assets, aiming to enable the state to confiscate criminal assets in cases where conviction is not feasible. This would be in addition to the existing criminal confiscation system.

The NCBC regime has a hybrid criminal/civil nature with a direct nexus to criminal proceedings. The proposed law imposes conditions on the application of NCBC. For instance, a prior criminal investigation must have taken place. NCBC proceedings can only be commenced if the suspect cannot be prosecuted/convicted due to reasons such as death, evasion, or absence. In addition, criminal confiscation takes precedence if prosecution of the perpetrator is feasible.

New standard of proof

The legislative proposal introduces a distinct, sui generis standard of proof compared to that applied in traditional civil proceedings, where the judges are bound to examine the admissible evidence to obtain the formal truth. The proposed law stipulates that the court will approve a request for NCBC if the state’s attorney (as the petitioner) can prove that the assets in question are indeed criminal assets. Conversely, the court will reject the confiscation request if the objecting party can prove that they are the rightful owner of the assets and/or that the assets are not of criminal origin.

Impact on non-conviction-based confiscation

What does the adoption of this standard entail? In the context of proceeds of crime, the court must be convinced, by evaluating the evidence presented by the petitioner, that the assets stem from committing a criminal offence. In other words, the confiscation cannot be based on suspicion; it must be based on evidence. Therefore, NCBC proceedings become a quest for substantive truth concerning the unlawfulness of the assets. While this standard does not immediately equate to the criminal standard of proof, it is clearly of a higher degree than the balance of probabilities.

Lessons to be learned for Dutch and European law

The proposed law is also relevant for EU legislation. The adoption of Directive (EU) 2024/1260 requires EU Member States to introduce a national NCBC framework that has a robust standard of proof. Under this framework, an NCBC order is issued only if the court is convinced that the criminal assets are derived from or related to a criminal offence. In this context, the Dutch government has stated that the Dutch NCBC bill, which initially followed a civil law framework, would adhere to the ‘criminal law’ NCBC regime outlined in the Directive.

Conclusion

Adopting a higher standard of proof obliges states to be more stringent in obtaining and presenting lawful evidence to justify the confiscation request. As such, states will only contest strong cases with sufficient evidence to prove the criminal origin of the assets. This will discourage the arbitrary confiscation of legitimate assets.

While the Indonesian NCBC proposal still requires closer examination in several areas – such as regarding the reversed burden of proof as well as fair and proportionate allocation of authorities in investigations, litigations and asset management – the use of a material standard of proof is one of its positive features. The better the safeguards, the greater the fairness.

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