EIB publishes a summary of the European Anti-Fraud Office report into alleged misuse of EIB loan by Volkswagen AG
- EIB was at no stage informed about the defeat device, and if it had been the EIB loan would not have been granted, says report
The European Investment Bank has today published a detailed summary of the investigation report by the European Anti-Fraud Office (OLAF) into alleged misuse of EIB loan by Volkswagen AG. This was done in accordance with the EIB Group Transparency Policy and considering the strong public interest in this highly exceptional case.
The summary includes all information relevant to the public interest and also includes extracts of the report, providing the public with an informative and meaningful account of the OLAF investigation. The investigation concerns practices which have been the centre of controversy and legal action ever since 2015, when environmental authorities in the US issued a notice of violation against Volkswagen AG for producing and selling diesel cars that featured sophisticated software to circumvent emissions standards for air pollutants. Notably, the report states: “The investigation established that VW never informed the EIB throughout the duration of the loan from 24 February 2009 to 24 February 2014 about the continuous use and implementation of this `defeat device' on the EA 189 engine in the context of the Research and Development activities financed by the EIB loan.” OLAF’s report further indicates that this information should have been communicated to the EIB and, had the EIB been informed of this relevant information, the EIB would not have granted the loan or would have requested full repayment.
OLAF opened its investigation in November 2015. The OLAF investigation focused on one sub-project under the loan “VW Antrieb RDI”, which was granted to Volkswagen AG by the EIB in February 2009. The aim of EIB loan “Antrieb RDI” was to provide financing for the development of power engines and power train components for passenger cars and commercial vehicles. The notion of 'defeat device' was used in the OLAF report to refer to VW's sophisticated ”software which aimed at circumventing emissions standards for air pollutants, in particular nitrogen oxides (NOx) […] The ‘defeat device’ deployed on the EA 189 engine detected if the car was operated under testing conditions and accordingly activated and deactivated certain functionalities in order to meet emission standards during tests while offering full performance of the vehicle under normal driving conditions.”
The end of legal proceedings arising from the OLAF investigation and the implementation by the Bank of OLAF`s recommendation gives the possibility to the Bank to publish the summary of the OLAF report.
EIB and Volkswagen AG finalised an agreement in December 2018, following the OLAF investigation. As part of the agreement Volkswagen AG voluntarily committed to contribute EUR 10 million to environmental and/or sustainability projects in Europe. In addition, according to this agreement, the European Investment Bank concluded its investigation and Volkswagen AG in turn agreed voluntarily not to participate in any European Investment Bank project for an exclusion period of 18 months. Since October 2015, the consideration of loans by the European Investment Bank to Volkswagen AG had been under suspension.