The terrorism threat has focused EU minds on co-operation
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EU ministers have agreed on a European Evidence Warrant (EEW) to speed up cross-border criminal investigations.
The agreement reached by the 25 interior ministers in Luxembourg enables justice officials to transfer data, documents and objects faster.
"We are completing the European space to fight terrorism and organised crime," European Union Justice Commissioner Franco Frattini said.
The EU had been striving for more than two years to reach such a deal.
Exceptions
Germany won the right to double-check evidence requests on six types of crimes, including terrorism and racism, reserving the right not to forward evidence if it considered the case would not be a crime under German law.
But this opt-out will be reviewed within five years of the EEW coming into force.
The Netherlands won the right not to transfer evidence in cases where the crime was committed on its territory.
Diplomats said the Dutch had feared numerous requests from EU neighbours seeking evidence in drugs offences.
Case-by-case
The agreement reached on Thursday boosts the role of Eurojust - the EU body overseeing judicial co-operation.
"Where a competent authority considers to use territoriality as a ground for refusal of a EEW, it will consult Eurojust before taking the decision," an EU press release said.
A decision not to transfer evidence for territorial reasons "must be taken exceptionally and on a case-by-case basis," the agreement states.
The EU's separate European Arrest Warrant came into force last year, slashing average extradition times between EU countries from nine months to just 43 days.