In this post, we will provide you with the information on the progress of anti-corruption reform in Ukraine. This update mostly based on information from the latest National Council of Reforms meeting where anti-corruption progress was the main topic. This is quite symbolic as one day earlier a Member of Parliament was arrested on corruption charges.
In this post we will (1) provide some details on the striking recent arrest of the Member of Parliament. Further, we will (2) tell you how the public authorities see the status of corruption reform in Ukraine.
(1) On 17 September 2015 the Parliament allowed the prosecution and detention of the People’s Deputy Igor Mosiychuk. During the session in the Parliament, the Prosecutor General, Victor Schokin presented a secretly recorded video where Mr. Mosiychuk promised to use his influence to facilitate obtaining the license and received money from an unidentified man.
Currently, as a result of this video the society divided into (1) those supporting both the President and the Prosecutor General and (2) those seeing this as pre-orchestrated scenario to punish political party for quitting parliamentary coalition. If you would like to see the referred video, please follow the link.
(2) To go back to the anti-corruption reform, it seems that key public officials have finally started focusing on this topic. Below we would like to share with you the highlights discussed at the meeting.
Corruption prevention legislation is formed. According to the President, the effective legislation to fight corruption has been formed. In our view, this statement is partially true as some other crucial legislation is still emerging as you will see below.
Anti-corruption Prosecutor’s Office (ACPO). In was noted that delay in establishment of this body does not allow National Anti-corruption Bureau to start active investigations. It is worth noting that few days ago election committee which will choose candidates for ACPO has finally begun its work.
National Anti-corruption Bureau of Ukraine (NABU). 70 first detectives completed training program. NABU formation took quite a long time, but hopefully it will begin investigation of corruption offences by the end of the year.
National Corruption Prevention Agency (NCPA). The specially established commission started selection of NCPA members. Like with NABU, it is expected that NCPA will start its activities by the end of the year.
Financing of political parties. An opinion was expressed and supported that political parties shall be financed in a more transparent way as their direct dependence from oligarchs is harmful to Ukraine. It is worth noting that the respective law has been voted for in the first hearing. The law provides for financing of political parties from the state budget funds.
Transparent public procurement. The President mentioned that conducting below-threshold tenders through ProZorro electronic system allowed cutting budget spending by 20%. It is expected that 2 billion dollars will be saved next year. It is worth mentioning that recently the Parliament adopted the law aimed at prevention of corruption in public procurement. The law decreases the number of documents to be provided by the participants, introduces a requirement of most documents provision only by the winner, limits the ability of procuring entity to reject tender bid on a formal grounds, etc.
Remuneration of public officials. The suggestion to significantly cut positions in the public sector and spend saved money to increase salaries was also actively discussed. We believe that is a step in the right direction, however other measures should be implemented as well. For example, the government should assess the possibility to allocate money from international donors to significantly increase salaries of high-ranking officials and directors of state enterprises. We think it is crucially important that the government and the business compete for the best talent.
Withdrawal of the deputies’ and judges’ immunity. The Parliament Speaker confirmed the readiness of the Parliament to vote for withdrawal of the immunity.
Code of ethical behavior of public officials. An opinion was voiced to follow the United States approach, where state officials undergo online trainings before signing the Code. We believe that such trainings could be quite effective if properly implemented.
Ban for release on bail persons arrested on corruption charges. Although this is a standard European practice, release on bail of suspected corruption offenders strongly disapproved by the society. The Parliament Speaker confirmed the readiness of the Parliament to vote for such ban. We think that the bail should be high enough to prevent the person from avoiding justice. Some claim that no bail should be allowed at all and the person should be detained during court proceedings.
Anti-corruption conference. It was announced that on 16 November the anti-corruption conference will be held. Hopefully, we could attend and will definitely provide an update on the anti-corruption developments.
Certain gaps in anti-corruption reform were also discussed such as:
No strategy of reformation of state governance has been approved (this means that EU financing will not be provided on 1 January however may be provided on 1 April).
The draft law on Public Service has not been adopted (this was a precondition for EUR 600 million aid from EU).
Online publication and verification of assets declaration of public officials claimed to be ineffective. The system should be launched by January 2016.
These are the basics the one have to know about anti-corruption reform in Ukraine as of today. If you would like to get more detailed information about the status of anti-corruption reform, you can follow a comprehensive tracker at the following link (in Ukrainian).
To finish this update on a positive note, according to the Secretary of the National Council of Reforms current anti-corruption enforcement is 4 times higher as compared to the last year. Also, unlike previous periods, the enforcement is also targeting high-ranking officials. We are very curious to know what you think of this statistics.
Please also share your thoughts on the anti-corruption reform – do you see any real progress? Your comments will be much appreciated.
Pavlo is a regional Legal and Compliance Head with a global pharmaceutical company. He leads Legal and Compliance function in CIS & Romania as a part of Emerging Markets business region.
He got his LL.M. degree in International Business Law from Tilburg University, the Netherlands. He also graduated from Ukrainian university with a Master degree in Commercial Law.