Ukraine may see emergence of the National Commission for Prevention of Corruption

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07.10.2014

Verkhovna Rada of Ukraine adopted in first reading a package of anticorruption draft laws, one of them envisaging establishment of the National Commission for Prevention of Corruption.

The draft law envisages, amongst other things, wider use of anticorruption instruments, including anticorruption expert assessment of draft laws and regulations, special anticorruption integrity checks and increased access to and transparency of information. The National Commission for Prevention of Corruption, defined as the specially authorized state body for corruption prevention, will, amongst other things, engage in monitoring assets declarations and lifestyles of civil servants and preventing conflict of interest.

The Parliament has also adopted two draft laws in their first reading, including 5114 “On introducing amendments to certain laws of Ukraine regarding identification of ultimate beneficiaries of legal entities and politically exposed persons” (247 votes) and 5067 “On preventing legalization (laundering) of funds received through criminal proceeds, financing terrorism and proliferation of weapons of mass destruction” (243 votes). The latter law was adopted at the recommendation of FATF.

In addition to these laws, the Parliament has had a 278-strong vote for establishment of a National Anticorruption Bureau and for launch of the National Anticorruption Strategy.

All of these laws have been voted for an expedited procedure of consideration within the Parliament, with a possible decisive second reading vote on 14 October to adopt the laws in full and send to President for signature.

TI Ukraine director has commented the general essence of the anticorruption law package and the public rally that was held in front of the Parliament to "facilitate" a vote for the anticorruption package (adapted from this source):

"First of all, the Parliament allowed in absentia arrest of those, who have committed corruption-related crimes, offences that pose threat to national security or wellbeing of citizens. This means that after the law is signed by the President, courts will be able to impose in absentia arrest onto Mr. Yanukovych, as well as his accomplices together with the “Berkut” special police force who first shot at people, and have now disappeared. All the assets that have been obtained through corrupt activities will also go under an in absentia arrest. In the case of Ukraine this would mean that Ukrainian enterprises controlled by Yanukovych will not be able to earn proceeds to be shipped to the chief corruption felon of the country, who then uses them to support separatism in the east of the state.

Remaining four anticorruption laws have gone through the first reading and will be finalized for a decisive vote in exactly a week – on Pokrova Feast day. Firstly, it is the bill on establishment of the National Anti-Corruption Bureau, an independent law enforcement agency introduced to prosecute corrupt high-ranking public officials. This means that Ministers, Members of Parliament, judges and prosecutors may become clients of this Bureau rather than village council heads or teachers. All the statistics on corruption cases in the past several years was mainly based on the latter cases.

The draft law on adoption of the National Anti-corruption Strategy has gone through the first reading as well. This is a pity to see it happen only now, since existence of the strategy means a clear roadmap of reforms in the area of fighting corruption that presents a coherent view for the Parliament, the President and the Government. As we could see, half a year was required to find this united view, despite the strategy being ready as early as March this year.

The draft law on preventing corruption has successfully gone through the first stage of the pipeline of the Parliament as well. The seemingly innocent title overarches some very clear mechanisms for decreasing corruption prevalence amongst Ukrainian bureaucrats. First of all, a truly independent anti-corruption commission to operationalize relevant safeguards is established—the National Commission for Prevention of Corruption. In essence, the Commission is an upgrade from the current Office of the Government Agent for Anticorruption Policy. Tetiana Chornovol, until recently the Government Agent, resigned, in part, due to inability to work in a situation when resources are lacking. This unfortunate ailment is corrected by the said law.

The Commission will collect online and thoroughly check on a single web-site ALL declarations of Ukrainian public officials. They will declare their income, presents, assets, interest, and – most importantly – all expenditures that exceed 10 minimum wages. Currently this is the amount that slightly exceeds UAH 12 000. Worthwhile it is to say that currently they are required to declare all purchases that exceed UAH 80 000, and a year ago they were required to declare all purchases in excess of UAH 150 000. Lowering the declaration threshold ten times in a year is a very good step forward.

All these declarations will be filled online, according to a unified template, and a software package will check data automatically. For this, it will compare the figures with all possible registers, and if discrepancies are uncovered, will demand for a thorough review of the declaration of a public official. All public offices with inherent corruption risks (senior positions, organizers of tenders, administrative managers), as well as a random 10% of all other declarations will undergo a complete review (verification) of the declaration. All data (including that on the Members of Parliament) will be open to the public, and misrepresentation of information on the declaration will equal to a 2-year jail sentence: just to make sure that this is taken seriously.

The Commission will also monitor management of the conflict of interest for public officials and help prevent situations when those who have access to public funds abuse them for their own profit. If the conflict is identified all the decisions that were taken under circumstances of a conflict of interest will be canceled, and culprits will have to compensate the resulting damage. This draft law has many more innovations, and is in fact a rewritten edition of the baseline anti-corruption law. Amongst the innovations is, for instance, lifestyle monitoring vis-à-vis high-ranking public officials and their lustration in case the source of their income or property cannot be explained.

The fact that a draft law on transparency of data about real owners of companies was also voted is of no less importance. It is no secret that most companies that win tenders in Ukraine belong to offshores or are registered with proxies. In fact, they remain controlled by the very same Ukrainian oligarchs and high-ranking public officials. If this law is passed by Parliament, it will demand that authorities reveal this information and establish a unified register of politically influential people. These individuals will be under special scrutiny in case they have any relations with the state.

Apart from these 5 drafts, the Parliament failed to consider initiatives on making data of property and land registers open to the public (draft law #4728 was registered in the Parliament over half a year ago) and on introduction of transparency in budget spending (draft law #2012 passed the first reading in summer, but its status has not been updated since). Neither did the Parliament pass a new edition of the laws on prosecutor's office and judicial system. The anti-corruption reform cannot be complete without them.

So, Pokrova Feast day, 14 October, has been determined as the day for decision-making by the parliamentarians. They promised to pass all the above-mentioned initiatives on that day and finally launch a real anti-corruption reform. They took the time out allegedly to finalize all these draft laws. In fact though, it is rather possible that the MPs will introduce changes to these laws that will make them as weak as possible. This has already happened under Yanukovych, when in 2011 the Parliament considered every article of the basic anti-corruption law separately, and as a result excluded countless principally important things from it.

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Citizen oversight has great influence.
For instance, as of 10.30 a.m. today only 232 out of 450 MPs registered in the Parliament. However, under the “tomato pressure” of the citizens in less than an hour 278 MPs were voting for Anti-corruption Bureau. This means that almost 50 parliamentarians came to the Parliament when they were pressed by people to do so, and voted positively."