The European Public Prosecutor’s Office (EPPO) has exposed a large-scale criminal network responsible for fraudulent imports of goods from China into the EU, operating through the Greek port of Piraeus. The scheme, which exploited customs procedures and VAT exemptions to evade payment of duties, is believed to have caused losses of at least €700 million to the EU and its Member States.
Code-named Investigation ‘Calypso’, the operation targeted criminal groups that systematically undervalued and misclassified imported goods – including textiles, footwear, e-bikes and e-scooters – to avoid customs charges. Goods were declared at entry under false documentation, then sold through a chain of shell companies across the EU, while VAT and duties went unpaid.
The investigation involved coordinated raids across Greece, Spain, France and Bulgaria, with 101 searches conducted at customs brokers’ offices, freight companies, tax advisory firms and private residences. Ten suspects, including two customs officers, were detained. Authorities seized approximately €5.8 million, including digital wallets and cryptocurrency, along with 7,133 e-bikes, 3,696 e-scooters, 480 containers, and various firearms. Property seizures included 11 real estate assets in Spain, 27 vehicles, and numerous luxury items.
The criminal activity focused on exploiting Customs Procedure 42 (CP42), a mechanism designed to simplify cross-border trade by allowing VAT-exempt imports if goods are transported to another Member State. In practice, however, the goods were not forwarded to the declared destinations. Instead, they were stored in secret warehouses and distributed via illicit channels, often sold in cash on the black market.
Investigators believe the network was organised and operated primarily by Chinese nationals, who oversaw the full logistics chain – from import and distribution to sales and repatriation of profits. A web of professional facilitators, including customs brokers, tax advisers and freight operators, supported the operation, enabling the importation of goods through fraudulent practices and concealing their actual movement.
Fake documentation was used to understate the value of goods and to create a trail of fictitious transactions involving buffer companies, missing traders, and fraudulently hijacked VAT numbers from legitimate businesses. The final destinations of the goods were often France, Italy, Poland, Portugal and Spain, though they were falsely declared as bound for other countries to avoid scrutiny.
The profits, once collected in cash, were laundered and transferred to China using underground banking systems and trade-based laundering techniques. The groups involved operated what authorities have described as self-contained criminal enterprises, overseeing each link in the chain – from initial shipment to financial concealment.
The EPPO estimates that over €250 million in customs duties – which contribute directly to the EU budget – were evaded, alongside nearly €450 million in unpaid VAT, impacting national revenues. The total financial damage may be even higher, with Greece’s Independent Authority for Public Revenue (AADE) assisting EPPO in assessing the full scale of the losses.
The investigation was supported by Europol, which facilitated coordination through a Virtual Command Post and deployed an expert to the command centre in Luxembourg. The European Anti-Fraud Office (OLAF) also played a role in detecting the scheme. National agencies across the involved Member States, including the Hellenic Police, France’s National Anti-Fraud Office (ONAF), Spain’s Tax Agency, and Bulgaria’s State Security Services, provided operational support.
The port of Piraeus – majority-owned by China’s COSCO Shipping – served as the primary entry point for the illicit shipments. The findings may intensify scrutiny of Chinese logistics operations within Europe, particularly where oversight mechanisms are perceived to be vulnerable.
According to the EPPO, the criminal structures resembled closed logistical communities, operating controlled warehouses that were inaccessible to outsiders and used specifically for illicit storage and redistribution. Upon delivery, transport documents were destroyed, leaving little traceable evidence. The goods were then sold through parallel markets, with revenue streams entirely outside the formal economy.
This investigation represents one of the most significant actions by the EPPO since its inception. The case illustrates the extensive use of cross-border cooperation to disrupt organised economic crime affecting the EU budget and Member State finances.
All individuals under investigation are presumed innocent unless proven guilty in court.
The EPPO, headquartered in Luxembourg, is the EU’s independent body responsible for investigating and prosecuting financial crimes affecting the Union’s interests, including cross-border VAT fraud and misuse of EU funds.
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