The Guidance clarifies the provisions of Act No. 22 of February 16, 2011 on the Prevention of Conflict of Interest (Zakon o sprječavanju sukoba interesa, hereinafter, the Act) that provides for the measures for the prevention and management of conflict-of-interest situations and the disclosure of assets by officials. The document highlights that a certain institutional progress has been achieved since the Commission was set up in 2011. However, the awareness of officials about existing bans and restrictions remains insufficient. The Guidance reviewed here was issued also to fill the indicated gap.
According to the Act, a conflict of interest is a situation where personal interests of an official are in conflict with the public interest; at the same time, the Guidance specifies that conflict of interest as such is not an act corruption.
The document stresses that a conflict of interest can be:
- real – when personal interests of the official affect or have already affected (or there are reasonable grounds to believe that they affect or have already affected) his/her impartiality in the exercise of his/her official duties;
- potential – when personal interests of the official may affect his/her impartiality in the exercise of his/her duties in the future.
The authors of the document indicate recusal as the priority measure for managing conflict-of-interest situations: when the circumstances that may trigger a conflict of interest are detected, the official should inform competent officers accordingly, terminate his/her participation in the respective activities/decisions and transfer the functions whose performance may trigger a conflict of interest to another person. In the event that the official doubts whether a certain situation triggers a conflict of interest he/she should reach out to the Commission. The latter should provide the official with its opinion within 15 days.
There are a number of bans, restrictions and responsibilities for officials to prevent conflict-of-interest situations, including:
- obligation to disclose their assets (articles eight to ten of the Act);
- restrictions on accepting gifts (article 11);
- restrictions on undertaking other remunerated activities (article 13);
- restrictions on participating in the management/holding a share of organisations (articles 14 to 18);
- post-employment restrictions (article 20).
The review of some of them is provided below.
1. Declaration of assets
The officials subject to the provisions of the Act (article three) should submit asset declarations to the Commission upon assuming and leaving their office. The declaration should include, in particular, the information about movable and immovable property, shares in companies, debt obligations, income, etc. (the exhaustive list of data to be disclosed is provided in article eight of the Act).
If the financial situation of an official considerably changes during the term of office, he/she should submit an updated declaration to the Commission. In this context, “a considerable change in the financial situation” means, in particular:
- change of annual salary/amount of pension payments by over 10 per cent;
- any changes in the prices of immovable property;
- change in the prices of movable property by over 30,000 HRK (roughly 4,700 USD);
- any changes in cash savings, and other circumstances.
The declarations are to be completed using an electronic form which in most cases involves a selection of options from a drop-down menu. Besides submitting declarations in the digital format, officials should print it out, sign and send it to the Commission.
2. Restrictions on accepting gifts
The Act allows officials to accept gifts whose value does not exceed 500 HRK (roughly 79 USD), except for the gifts in the form of cash, securities and precious metals. In the other cases gifts should be transferred to the State ownership.
The gifts from family members, relatives and friends, as well as national and international signs of recognition and awards are not considered as gifts for the purposes of the Act.
3. Post-employment restrictions (“revolving door”)
Within a year after leaving his/her office, an official is not allowed to seek employment in the organisations which, during the term of his/her office, were in a business relationship with the bodies where he/she worked, or are going to enter in such relationship. In this context, business relationship means the conclusion of public procurement and concession contracts and public-private partnerships, receipt of public assistance and public funding in another form. In certain cases the Commission can authorise officials to be employed in the absence of a conflict of interest.
If some indications of an infringement of the established bans, restrictions and responsibilities are detected directly by the Commission or a non-anonymous report based on evidence is made, the Commission can (and must in the event of a personal request of the official) initiate proceedings within the limits of its authority.
If the infringements of provisions of the Act are proved, the Commission can decide to impose sanctions including:
- suspension of the payment of a part of the salary;
- public release of the decision made by the Commission.
In the event that the official fails again to submit his/her assets declaration after having been sanctioned, the Commission can make a motivated proposal to the representative of his/her employer to dismiss his/her. The breaches of the Act are also punishable by fines ranging from 5,000 to 1,000,000 HRK (roughly from 784 to 157,000 USD).