31.01.2011 | Yury Butusov

Anti-Corruption Default


Yury Butusov begins his latest article on non-efforts to fight corruption, published in the authoritative weekly Dzerkalo Tyzhnya, with a quote from President Yanukovych. In October 2010 the President said: “I hope that we will be able to finally carry out effective State policy on fighting corruption which at the present time jeopardizes the country’s national security. We have already received expert conclusions from GRECO. These in general contain a positive assessment”.

The author notes that in a country where the most lucrative business is not production or trade, but the tax and customs inspectorates, friendship with the sons of the President or Prime Minister, etc, talk about fighting corruption has long become a boring ritual. “A ritual aimed at western diplomats so that the families and bank accounts of Ukrainian leaders feel at home in Europe and don’t create a negative image in civilized society.

With respect to the substance of the fight against corruption in Ukraine, by all formal indicators the country can declare full anti-corruption default. At least all states on fighting corruption made by President Yanukovych since his inauguration risk default. It’s enough to simply compare the organization of the fight against corruption up to his coming to power and now, almost a year into his active work.

  1. The anti-corruption package of laws which should have come into force on 1 January 2011 has been totally scrapped. The alternative draft law submitted by Yanukovych has only passed its first reading and will reach the profile parliamentary committee for consideration only on 2 February. Nobody would feel confident to predict when it will be passed in full, and in what form. And in fact that is not so important since the draft law has lost the most crucial norms, most importantly the norm making declaration of spending by public officials mandatory.
  2. The structures which coordinated the drafting and implementation of anti-corruption legislation – a Government Ombudsperson and a Bureau on Anti-Corruption Policy – have been dissolved.  It should be recalled that these structures were created in fulfilment of Ukraine’s international obligations to the Council of Europe. The liquidation of these institutions cannot be explained away by any administrative reforms. The regime has thus demonstrated its total disregard for many years of cooperation between Ukraine and the EU. This shows that they are deliberately burying long-term programmes for Ukraine’s European integration. The creation of a national anti-corruption committee can in no way make up for this since it is essentially an image project without even the fundamental provisions regarding its work having been drawn up. Furthermore it is unclear when the Committee will next meet and in the President’s Administration they say that this project has already exhausted its uses and lost its relevance.
  3. In a year the President has not fulfilled his commitment to draw up and pass a National Strategy on Countering Corruption. It is not known when this Strategy will be passed. There are no predictions, no project and this question is not one of priority for the regime.
  4. It is not surprising that the anti-corruption default has led to default in foreign policy as well. The Czech Republic’s refusal to extradite former Minister Bohdan Danylyshyn, accused of criminal offenses, is a resounding slap in the face for Yanukovych’s European initiatives. Europe has stopped trusting Ukraine as a country capable of carrying at least vaguely legitimate law enforcement activities. Europe has recognized the farce of the anti-corruption proceedings which the authorities are enacting against officials of Yulia Tymoshenko’s government.
  5. And as to the substance of the issue: in the last year the regime has not only centralized all corruption channels in all State institutions, but has also given the demands of officialdom a systemic and irrevocable nature. Even the largest foreign investigations cannot get back legally calculated and registered VAT without losing from 20 to 50%. Corrupt fees at customs and in the Security Service [SBU] have been imposed on a number of food products and everyday goods.

President Yanukovych has on a number of occasions cited GRECO (the Group of States against Corruption) which monitors Ukraine’s fulfilment of its anti-corruption commitments.  The Head of GRECO, Drago Kos, spoke about how his organization assesses Ukraine in an interview to Dzerkalo Tyzhnya.

How do you view the revoking by the Ukrainian government of the package of anti-corruption laws agreed with GRECO,  and the resulting deferment yet again of new anti-corruption legislation coming into force, as well as the dissolution of the Bureau on Anti-Corruption Policy and Government Ombudsperson on anti-corruption policy? Were these changes agreed with GRECO?

In the Report on Ukraine’s Implementation of Recommendations, approved in May 2009, GRECO found the creation of the Bureau on Anti-Corruption Policy evidence that the country was “open to the development and implementation of real anti-corruption policy”. International experts also saw the adoption of the anti-corruption package as an important step in the right direction. That was the last information which GRECO received from Ukraine. The revoking of the package and dissolution of the Bureau on Anti-Corruption Policy may demonstrate an important and regrettable step in the wrong direction. If in the near future a better solution to the situation with the laws and the Bureau is not found. However time is passing quickly.

What do you think of the fact that in the new draft anti-corruption law tabled by the President there is no norm on liability of private sector legal entities?

Legal entities must bear responsibility for corrupt offences. Many international conventions to which Ukraine is a signatory make this norm mandatory. The last of proper regulation of this issue thus places in question the real will of the country to fulfil its international commitments and will undoubtedly prompt GRECO to conclude that the most important recommendations have not been implemented.

According to the President’s draft law, a proven case of corruption involving up to 5.5 thousand dollars (45 thousand UAH) can carry an administrative fine of 200 dollars (1,700 UAH).  The offender may also not be dismissed. Are there any EU countries with such a penalty for corrupt offences?

International conventions and GRECO strive to achieve “effective, convincing and adequate” penalties for criminal offences involving corruption. In the member States of GRECO there is consistent practice where imprisonment for a certain number of years (usually five or more) is considered to be sufficient for implementing those international commitments. I know of no countries where there is only a fine for corrupt offences.

According to the President’s draft law, even a proven case of bribe-taking is not grounds for a court to confiscate the offender’s property and there is no norm on confiscation. How is this problem resolved in other GRECO countries?

One of the basic rules of any criminal legislation with which I am familiar is the ban on retaining profit received by criminal means – in its original form or its replacement value. This is also a requirement of any international convention on criminal legislation. Not only European countries introduced such measures many years ago. Countries are more and more often implementing decisions which allow confiscation of property for certain criminal offences even before the court ruling.  An increasing number of countries are changing the procedure for proving charges regarding income gained by criminal means.

The norm has been removed from the draft anti-corruption legislation on the specific checks of property, income and spending of public officials. If a poor Ukrainian official has a rich wife and children, the source of their prosperity is concerned from the public. How does GRECO view the abolition of this anti-corruption norm?

This is not a strictly imposed norm. Some countries have serious problems with their constitutional courts regarding automatic imposition of such commitments for the relatives of public officials. However even in those cases where the constitutional courts refuse to allow automatic imposition of such norms, there is always the possibility of carrying out a special check of officials’ relatives where there are well-founded grounds for believing that officials are concealing their own wealth by using their relatives. Such systems function and I don’t know any country where it would not be possible, at least through not very complicated procedure, to check the financial and material position of relatives of officials.

Do you see fighting corruption as being a State priority in Ukraine?

GRECO and the Council of Europe have expended considerable effort and cost on supporting Ukraine in fighting corruption. Over many years we have not received the results we expected. We understand the country’s problems however are aware that much more could have been done on fighting corruption. Better results in this area would clearly help to resolve a number of important problems for the country. As of yet this is not the case.

When is the next visit of the GRECO monitoring group to Ukraine planned and how realistic for Ukraine are plans for a visa-free regime with the EU while the GRECO recommendations on modernizing anti-corruption legislation have not been implemented?

There will still be several GRECO reports on Ukraine and I hope for a serious improvement in the situation during that period – there is simply no other way. As far as a visa-free regime is concerned, I have seen countries with a level of corruption lower than in Ukraine and with a better developed regulatory base for fighting corruption which have had to make considerable efforts in the anti-corruption sphere in order to receive visa-free status. Ukraine will be in a very difficult situation applying for visa-free status without any serious achievements in the anti-corruption sphere, such as full implementation of GRECO recommendations.

Ukraine has to report on the unimplemented GRECO recommendations in the near future. What may be GRECO’s reaction to the revoking of all anti-corruption legislation, the institution of Ombudsperson on Anti-Corruption Policy and the Bureau on Anti-Corruption Policy?

GRECO will shortly consider the supplementary information provided for Ukraine’s Report on Implementation of Recommendations. If the results at the time that the report is passed are not current, this will probably arouse serious debate regarding the situation and could also lead GRECO to very unpopular ((negative) conclusions and decisions. GRECO can simply not afford to silently watch while a country which is particularly important for use revokes positive processes. However I still hope that this will not happen!”

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