In particular, the following laws were signed: "On the National Anti-Corruption Bureau", "On Prevention of Corruption", "On Anti-Corruption Policy Framework in Ukraine (Anti-Corruption Strategy) for 2014-2017", and "On Introducing Amendments to Certain Legal Acts on Determining Ultimate Beneficiaries of Legal Persons and Public Actors", as reported by official web-site of the head of state.

 

The Law "On the National Anti-Corruption Bureau" provides for setting up a special government law enforcement body aimed to counter corruption-related crimes that are committed by top officials and constitute a threat to national security.

 

The Law "On Prevention of Corruption" stipulates a comprehensive reform of the system to fight corruption in line with international standards and best practices of other countries. Specifically, it is planned to establish National Commission for Prevention of Corruption.

 

The Law "On Introducing Amendments to Certain Legal Acts on Determining Final Beneficiaries of Legal Persons and Public Actors" sets forth the mechanism to determine private persons – final beneficiaries of legal persons, and to grant free access to State Register of Property Rights to Real Estate.

 

The Law "On Anti-Corruption Policy Framework in Ukraine (Anti-Corruption Strategy) for 2014-2017" provides for a set of priority measures aiming at decline of corruption in Ukraine and creating grounds for subsequent anti-corruption reforms.

 

Verkhovna Rada adopted all these laws on 14 October. In his detailed comment regarding some aspects of the adopted legislation, Oleksiy Khmara, Executive director of Transparency International Ukraine, emphasizes those areas that have seen most radical transformations at the time of preparing the laws for the second reading. Source for the original of the article: http://bit.ly/1yBDXja

 

"Good news comes first

 

On October 14, the last working day of the current convocation, the Parliament, elected in 2012, took a (quite literally) landmark decision – it voted for a set of anti-corruption laws, as well as for a special law on Prosecution.

 

Thus, MPs supported the National Anti-Corruption Strategy for 2014-2017 as a unified roadmap of the anti-corruption reforms, implemented by different government institutions. President Poroshenko did not wait for the official publication of this law, and already signed the Decree on Establishment of the National Committee for Anti-Corruption policy (in line with implementation of the Anti-Corruption Strategy).

 

The MPs also adopted a draft law on amendments to legislative acts of Ukraine regarding determining ultimate beneficiaries of legal entities and public officials. In essence, this document allows disclosure of information on true owners of Ukrainian enterprises and businesses.

 

MPs adopted a draft law on corruption prevention, which, among other things, prescribes establishment of a unified electronic repository for assets declarations of all Ukrainian public officials, regulates issues of anti-corruption limits in the process of appropriation of corporate opportunities, receiving gifts, secondary employment, common work of related or connected persons, issues concerning termination of work in government agencies. This law provides for targeted anti-corruption instruments (anti-corruption expert assessment, special anti-corruption inspection, the Unified State Registry of persons who committed corruption-related offenses, protection of whistleblowers from illegal dismissal, reclassification of position, and amendments in current terms of a labor agreement).

 

Parliamentarians also adopted a Law on Prosecution, which, among other things, deprives the Office of the Prosecutor of its general oversight functions. Thus, the Office loses the right to interfere in the lives of citizens or to influence business. This Law amends 51 Laws of Ukraine and 10 Codes, which are currently in force in Ukraine.

 

The week before, Verkhovna Rada adopted a draft law "On Amendments to the Criminal and Criminal Procedure Codes of Ukraine concerning the inevitability of punishment for the offenses against foundations of the national security, public safety and corruption offenses". This Law will allow returning billions stolen funds, seized by the former authorities and taken abroad, to Ukraine, as well as closing dozens of the cases related to Yanukovych, Arbuzov and the so called "Family". Within these proceedings all the assets are arrested (dozens of billions UAH), but the funds cannot be returned to the budget, because of existing legal hurdles.

 

And that is where the good news finishes and Ukrainian reality starts.

 

The devil is in the details: again

 

The most fundamental law, adopted by the Parliament on October 14, was the Law on the Anti-Corruption Bureau. It was this Law, which was argued and debated by the MPs for hours and hours. And it is this final variant of the law, which is criticized by experts and activists alike.

 

As the Head of the Parliamentary Committee for Combatting organized crime and corruption, Viktor Chumak noted, in the process of preparing the draft law on the National Anti-Corruption Bureau for the second reading the MPs considered 176 amendments and 52 of them were taken into account. As he said, the amendments to the Law were made the night before the vote on October 14 during the meeting of the Committee. Ambivalence of these amendments makes the experts say that MPs have adopted a Law that launches a much less effective body rather than a strong and independent Anti-Corruption Bureau.

 

In particular, the amendment of MP Serhii Vlasenko poses challenges for the investigative work of the Bureau. In the current wording of the law, permission to seize documentation and other procedural actions may be received by the Bureau only based on a court decision. The previous edition of the draft law determined that such actions could be undertaken on the basis of a written request of the Bureau Director or his Deputy, which has been agreed with a prosecutor.

 

In accordance with the Law the officials of the Anti-Corruption Bureau will be inspected against the criteria of the Law on Lustration. The provision for obligatory lie detector test was deleted in the latest edition of the law. This laxity is to be interpreted negatively, as the society has high expectations concerning integrity of the bureau officials. This amendment was made by the MP Rostyslav Pavlenko.

 

The ceiling for the staff of the Bureau is set at 700 persons, including not more than 200 persons in management positions. The Bureau covers the whole territory of Ukraine and works through its central apparatus and territorial branch-offices.

 

The Law determines a rather complicated procedure for selection of candidates for the top-management position – a special evaluation committee, consisting of 3 representatives of the President, 3 representatives of the Cabinet of Ministers and 3 representatives of Verkhovna Rada, who determine three alternative candidates for the position of the Director. The President then chooses one of them and submits the candidacy to consideration of Verkhovna Rada, which gives its consent to the President to appoint the Director. The Director of the Bureau shall be a citizen of Ukraine, with higher education, professional experience in the domain of no fewer than 10 years, and work experience at managerial posts for no fewer than 5 years. It is also stipulated that the Director of the Bureau cannot be a person, who used to be member of governing bodies of a political party or has labor or other contractual relations with a political party for two years before submitting an application to participate in the competition. The candidate, who has not passed the lustration criteria test, cannot be appointed Director as well.

 

The Director of the National Bureau is appointed for seven years. The same person cannot take this position twice. The Director of the Bureau may be dismissed by the President of Ukraine due to following reasons: at his or her own request, if he or she reaches 65 years of age, for medical reasons, in case if a court decision on his or her mental incapacitation or judgment of conviction, as well as loss of Ukrainian citizenship. The Director of the Bureau can also lose the position, if Verkhovna Rada passes a non-confidence vote by a simple majority (226 votes). For the issue to be considered, no fewer than 150 MP signatures are required. Such amendment of MP Serhii Pashynskyi makes the Director and the whole Bureau politically dependent on the will of the Parliamentary majority or hegemony of one political force in Parliament.

 

Before introduction of amendments, the Anti-Corruption Bureau investigator's salary amounted to approximately 18 000 UAH [USD 1400], and the Director's – to 50 minimum salaries (about 60 000 UAH per month [USD 4600]). Yet, the final version of the Law was adopted with the amendment of MPs Rostyslav Pavlenko and Serhii Pashynskyi that excluded the stipulated sums for the Bureau employees' salaries. With the exact salary scales unknown at this point of time, the expectations are that these will be rather humble, which may make one wonder about the true motivation of professionals seeking employment with the new anticorruption body.

 

According to the adopted Law, the Anti-Corruption Bureau will have the right to launch proceedings against individuals suspected of corruption, conduct investigations, demand investigation-related materials and criminal proceedings from law enforcement bodies and authorities, collect other information, including the information on property, income, expenses, financial obligations of officials. On the basis of the relevant court decision and written request of the Bureau Director or his Deputy, the Bureau may receive information and documents on transactions, accounts, savings, agreements of individuals and legal entities in banks, financial and other institutions, enterprises and organizations regardless of the property status of these entities.

 

The National Bureau, in addition, has the right:

- to seal archives, cash registers, premises (excluding residential) and other storage facilities, to take them under protection, as well as to seize the objects and documents for the term of 10 days on the basis of the relevant court decision;
- to have unobstructed access to government bodies, local self-government bodies, military units and establishments, transit points on the state border of Ukraine and customs control areas;
- to file an appeal to court to invalidate transactions according to procedures stipulated by the legislation of Ukraine, on the grounds, provided by law;
- to store, carry and use firearms and special equipment, as well as apply physical force;
- to act as a representative of the state interests in foreign juridical bodies in the process of consideration of the cases concerning search, arrest, confiscation and return to Ukraine of relevant assets.

 

Control and oversight for the National Anti-Corruption Bureau is vested with the Prosecutor General and prosecutors, authorized by him or her. The Civic Oversight Council (15 persons) will be established at the National Bureau on the basis of open competition.

 

Introduced [...] amendments kill the provision that prohibits officials of specialized law enforcement bodies, who have served there for the last 5 years, to be employed with the Bureau. This means that the Bureau will have a hard time recruiting truly new professionals unmarred by the corruption schemes of the past.

 

The most critical amendments of MPs are those that destroy political independence of the body. Dismissal of the Bureau Director due to political motives may be initiated by 150 MPs (which is a number of votes of one or maximum two factions in the Parliament) followed by a non-confidence vote by 226 MPs. Amendments, registered by the same authors, negatively influence on the procedure of the labor payment to the Bureau officials.

 

What comes next?

 

Adoption of the Law on Anti-Corruption Bureau, as adoption of other laws of the anticorruption package, is, amongst other factors, a prerequisite for Ukraine to receive the next tranche from the International Monetary Fund, World Bank and the European Union. And it means that even in such somewhat reduced form, the laws will be signed by the President and take effect.

 

No later than December the new Parliament will vote for the state budget for 2015, providing in it the funds for establishing the Anti-Corruption Bureau and build-up of the whole anti-corruption infrastructure.

 

It is highly probable that in the nearest future we will see competition for the position of the Director of the Anti-Corruption Bureau, and the Ministry of Justice will open access to property registers.

 

But the most crucial issue of the future is the vote (for or against) by the new Parliamentary convocation for restoration of all, not some, independence guarantees for the Anti-Corruption Bureau."