Update 3 | John Dalli resigns, will challenge OLAF: 'I will defend my name' [full statement]

Updated at 6:50pm and 7:08pm - adds comments by John Dalli.

European Union Commissioner John Dalli has today announced his resignation as a member of the Commission, with immediate effect.

In comments to MaltaToday, Dalli said he will fight to clear his name. "There are no facts or proof over my involvement. They just invented something and it's all circumstantial evidence," Dalli said.

In later comments to TVHEMM on national station TVM, Dalli said he was verbally informed of the OLAF investigation and that the EU-watchdog admitted that he had not participated "in any way" with whatever trading in influence was going on, and that no members of his staff was involved.

"They are basing themselves on circumstantial evidence because they claim I should have known what was going on," Dalli reiterated.

"I am speaking to my lawyers to open the necessary procedure to prove that these conclusions are false. I will keep working so that the efforts I made to review the tobacco directive that was going to propose stronger anti-smoking laws will proceed as schedule."

Dalli denied knowing of any negotiations between Swedish Match and the as yet unnamed Maltese middleman who claimed he could influence EU legislation. Dalli said he knows who this person is, but refused to state the identity of this person.

"I resigned so that I could have a free hand in opposing the allegations made about me," Dalli said, but would not comment on whether EC president Jose Manuel Durao Barroso had forced his resignation.

"I don't want to be a liability to anyone," he went on to say, adding that one should expect further developments in the coming days.

"For me this is a déjà vu," Dalli added, in reference to the 2004 fabricated report which led to his resignation as minister. He insisted that his decision to resign was motivated by his desire "to have a free hand" in his attempts to clear his name.

Meanwhile, New Europe has reported that the European Commission has "refused" to distribute Dalli's press statement.

FULL STATEMENT BY JOHN DALLI:

"This afternoon I was informed verbally by the President of the Commission of the conclusion of an OLAF investigation about an alleged attempt to influence my decisions in respect of the ongoing review of the Tobacco Directive.

"Even though the OLAF report states that there is no evidence of my direct participation in these events and that the decision making process of the Commission Services had not been influenced in any way, OLAF concluded that I was aware of these events basing themselves ONLY on circumstantial evidence.

"I deny categorically that I was in any way aware of any of these events. I am taking all action open to me to ensure that these unfounded conclusions will be proved completely false. I will continue to work so that all efforts made by myself and my services to revise the Tobacco Directive will proceed as planned."

Dalli informed the President of the European Commission Jose Manuel Barroso of his decision following an investigation by OLAF, the EU's antifraud office, into a complaint made in May 2012 by the tobacco producer, Swedish Match.

The company alleged that a Maltese entrepreneur had used his contacts with Dalli to try to gain financial advantages from the company in return for seeking to influence a possible future legislative proposal on tobacco products, in particular on the EU export ban on snus. As soon as the Commission received the complaint it immediately requested OLAF to investigate.

The OLAF final report was sent to the Commission on 15 October. It found that the Maltese entrepreneur had approached the company using his contacts with Dalli and sought to gain financial advantages in exchange for influence over a possible future legislative proposal on snus. No transaction was concluded between the company and the entrepreneur and no payment was made. The OLAF report did not find any conclusive evidence of the direct participation of Dalli but did consider that he was aware of these events.

The OLAF report showed clearly that the European Commission's decision making process and the position of the services concerned has not been affected at all by the matters under investigation.

The final OLAF report and its recommendations are being sent by OLAF to the Attorney General of Malta. It will now be for the Maltese judiciary to decide how to follow up.

After the President informed Dalli about the report received from OLAF, Dalli decided to resign in order to be able to defend his reputation and that of the Commission. Dalli categorically rejects these findings.

Barroso has decided that Vice President Maros Sefcovic will take over the portfolio of Dalli on an interim basis until a new Commissioner of Maltese nationality is appointed in accordance with article 246 (2) of the Treaty on the functioning of the European Union.

Giovanni Kessler, Director-General of OLAF will be available in the press room after the midday briefing tomorrow.

His resignation comes two years before the end of his term. A former finance and foreign minister, Dalli lost the race for the PN leadership in 2004 to Lawrence Gonzi.

Shortly after being appointed foreign minister, Dalli resigned as minister in July 2004 after being implicated in a false report by a private investigator of having accepted kickbacks on a medical equipment tender for Mater Dei. He was appointed Lawrence Gonzi's special advisor on economic affairs after he was cleared of the report's implications, while the private investigator was sentenced to two years' imprisonment. Dalli was later appointed social policy minister in 2008.