HSE University Anti-Corruption Portal
GI-TOC Anti-Corruption Implementation Report on the Balkan Countries

The Global Initiative against Transnational Organized Crime (GI-TOC) has published a report on the establishment of anti-corruption architecture in the Western Balkans.

 

In 2018, at a summit in London within the Berlin Process six Western Balkan countries - Albania, Bosnia and Herzegovina, Kosovo, Montenegro, North Macedonia and Serbia – made anti-corruption pledges and committed to following the provisions of the EU law. The GI-TOC experts’ report provides an analysis of the progress in their implementation as of 2021. 

1. Albania

At the London summit, Albania took a set of commitments aimed at:

  • enhancing the effectiveness of public-private partnerships;
  • strengthening the transparency of public procurement, including the introduction of e-procurement procedures and implementation of the Open Contracting Data Standard (OCDS);
  • participating in the IMF Fiscal Transparency Evaluation process;
  • improving mechanisms for the protection of whistleblowers; 
  • enhancing beneficial ownership transparency;
  • driving out the culture of corruption, in particular, by increasing training on ethics and integrity, and anti-corruption education;
  • signing up to the Common Reporting Standard initiative;
  • joining the Addis Tax Initiative;
  • joining the Extractive Industries Transparency Initiative;
  • implementing all recommendations by the Council of Europe’s Group of States against Corruption (GRECO).

To implement the pledges made, the country adopted a number of legal acts (in particular, the Law on the Register of the Beneficiary Owners, the Law on the Administration of Sequestrated and Confiscated Assets, the Law on Automatic Exchange of Information on Financial Accounts), concluded agreements (for instance, the Memorandum of Understanding between the Public Procurement Commission and the Open Contracting Partnership of 5 October 2020 designed to facilitate the introduction of the OCDS, and the Multilateral Convention to Implement Tax Treaty Related Measures), and introduced codes of conduct for MPs.

Additionally, amendments were made to the existing legislation, including the Law on Political Parties and the Electoral Code of the Republic of Albania, as well as the new action plan for 2020 - 2023 for the implementation of the Inter-Sectoral Strategy against Corruption was adopted.

Against this backdrop, however, the level of public trust in state institutions did not increase despite the steps taken to improve the legislation; therefore, the Albanian authorities initiated a number of additional professional and ethical verifications of the judiciary, the police and senior officials.

In addition to the legislative and strategic measures, the country made efforts to increase the effectiveness of law enforcement, particularly, with regard to the investigation of transnational crimes: thanks to the enhanced international cooperation a number of successful large-scale anti-corruption operations were conducted.

However, the GI-TOC experts stress that corruption is still rather widespread in Albania and investigations often do not end with a final conviction. However, even if there is a conviction, there are difficulties in applying such instruments as seizure and confiscation of illicit assets: Albanian legislation does not recognize concealment of the proceeds of crime as a separate offence, and offenders are instead prosecuted under money-laundering legislation. This, in turn, does not allow for employing relevant mechanisms in corruption cases, and the mandate of the Agency for the Administration of Seized and Confiscated Assets (Agjencia e Administrimit të Pasurive të Sekuestruara dhe Konfiskuara) is limited to assets related to the anti-mafia law. In this context, in order to at least somehow address these problems, Albania was planning to establish an Asset Recovery Office, which was not in place at the time of writing of the GI-TOC report. 

In spite of the fact that the country has created the architecture to counter corruption, including the National Bureau of Investigation (Byroja Kombëtare e Hetimit), the Special Anti-Corruption and Organised Crime Prosecution Service (Prokuroria e Posaçme) and the Special Court against Corruption and Organised Crime (Gjykata Speciale kundër Korrupsionit dhe Krimit të Organizuar), the final convictions against high-ranking officials are still few.

The country has not made any progress in implementing the commitment to develop its legislation on the protection of whistleblowers: the first law adopted in 2016 does not provide directly for the mechanisms for legal protection of reporting persons, which is an impediment for them to act.

In parallel, the disclosure of information about crimes, including those committed by senior officials, is hampered by the lack of freedom of the media and mechanisms for the protection of journalists against reprisals. 

Furthermore, the commitment regarding the transparency of public procurement has not been duly met yet: despite the amendments to the legal acts aimed at enhancing controls over public procurement and public contracting, Albanian companies say that in practice they continue to experience the lack of transparency in the public tendering system. 

2. Bosnia and Herzegovina

The summit resulted in the following commitments for Bosnia and Herzegovina: 

  • provide support to all institutions for the prevention of and fight against corruption (including the Agency for the Prevention of Corruption and the Coordination of the Fight against Corruption (Agencija za prevenciju korupcije i koordinaciju borbe protiv korupcije)) and to ensure their independence and sufficient resourcing;
  • review and modernise domestic legislation on political party financing;
  • improve the transparency and integrity of public procurement processes, revenue collection and public service;
  • facilitate exchange of information between competent authorities to prevent and fight corruption.

The GI-TOC experts stress that in order to meet these commitments the country has adopted a number of strategic documents and legal acts regarding the fight against corruption and organised crime, improved its criminal legislation, established new institutions and developed new approaches towards the fight against corruption in the public and private sectors.

However, this response is fractured, largely due to the fact that there is a number of autonomous structures that counter corruption within the limits of their territory and in accordance with their own needs. As a result, the domestic anti-corruption system remains complex, decentralised and poorly coordinated. The absence of uniform decisions for the whole country constitutes a barrier to the implementation of the pledges made at the summit.

Additionally, the report points out that the country’s criminal justice policy is largely ineffective in combating corruption: very few high-profile corruption cases end with a final conviction, which is caused by lengthy proceedings and the inadequate penalties that are insufficient to deter corruption. Bosnia and Herzegovina also does not have a unified approach towards seizure and confiscation of proceeds of crime, and the existing competent authorities do not have the mechanisms to ensure interagency cooperation and coordination, which implies an inconsistent enforcement of relevant legislation. 

Besides the ineffectiveness of law enforcement there is a number of factors favouring corruption, such as scarce transparency and inadequately complex public procurement procedures, the absence of nation-wide legislation on public-private partnerships and the obligation to disclose beneficial ownership along with low administrative potential of the Public Procurement Agency (PPA). 

As a result, Bosnia and Herzegovina has a high level of corruption. However, the absence of effective mechanisms for the protection of whistleblowers and independence and freedom of the media in the context of the deep-rooted mistrust in institutions’ capacities and the perception of corruption’s omnipresence, information about corruption offences is often undisclosed to the law enforcement bodies. 

With a view to address at least some of the detected problems the authors of the report recommend that the authorities of Bosnia and Herzegovina, in the first place, adopt measures to ensure the effectiveness of the judiciary and law enforcement agencies also by increasing managerial oversight of court presidents and chief prosecutors, adopting legislation and implementing measures to shorten the length of proceedings, improving cooperation among law enforcement agencies, and revise the framework for public administration as well as a strategy on public financial management to mitigate the lack of coordination of decision-making and prevent potential interference in the judiciary and law enforcement.

3. Kosovo

In its pledge at the summit, Kosovo put a strong emphasis on exposing corruption, modernising the public procurement system, strengthening the protection of whistle-blowers, ensuring access to information for competent authorities investigating beneficial ownership and driving out the culture of corruption.

The country already has in place the legal framework for the prevention of and the fight against corruption which is in line with the EU requirements. Its presence made it possible for the country to achieve certain progress in investigating and prosecuting high-ranking officials, seizing and confiscating illicit assets also by introducing interoperable databases that offer mutual access to police, tax and custom services. Additionally, Kosovo established Special Departments handling high-level corruption and organized-crime cases in the courts.

However, the authors of the report highlight that in practice, the situation with respect to corruption in the country has deteriorated over the recent years. The GI-TOC experts name such causes of wide-spread corruption as the lack of transparency and accountability in the public institutions, including public procurement.

Besides that, law enforcement is still largely ineffective. Despite several successful operations, such as a major raid to dismantle criminal activities in a buffer zone between Kosovo and Serbia that resulted in the arrest of many corrupt police officers, Kosovo has recently seen the number of acquittals grow, whereas the assets confiscated in the framework of these cases are disproportionately small if compared to the volume of ill-gotten gains. Consequently, Kosovo still needs to strengthen its judicial and law enforcement systems as well as to put an end to political interference in the operational activities of competent bodies.

Moreover, it is the insufficient legislation that hampers the implementation of the pledges made at the summit. For instance, Law No. 06/L-085 on the Protection of Whistleblowers is not in line with European or international standards, because it does not oblige institutions to set up reporting channels and imposes no financial penalties on those who retaliate against whistleblowers. In practice, the Lawhas not been enforced effectively. Other laws, such as those on integrity and conflict of interest, are still in force in their initial version and no measures have been taken to enhance the effectiveness of their enforcement. The authors of the report stress that most initiatives aimed at improving anti-corruption legislation and mechanisms to counter corruption, for example the initiation of an evaluation process into the performance of key senior officials suspected of corruption and enhanced control over public spending, are simply blocked by the current government. 

 

4. Montenegro

Montenegro, as other countries at the summit, made a pledge to:

  • adopt a set of laws regulating public private partnerships;
  • increase the transparency of public procurement procedures also by introducing e-procurement and implementing the Open Contracting Data Standard;
  • sign up to the Common Reporting Standard initiative;
  • ensure the effective performance of the anti-corruption body;
  • strengthen institutional integrity;
  • conduct anti-corruption education.

The country adopted a series of measures to meet these commitments. In particular, most information on public procurements is now available in digital form (on a paid portal), and the new law on public procurement has defined procedures for inspection control in cases of suspicious public procurements; the number of training initiatives focused on the reporting of corruption cases and the protection of whistleblowers has increased; an updated code of ethics for MPs has been adopted; 98 per cent of institutions have adopted integrity plans; and a national methodology for assessing legal compliance to corruption has been developed.

At the same time, the prevention of and the fight against corruption are still at low levels. 

In particular, the Agency for the Prevention of Corruption (Agencija za Sprječavanje Korupcije – ASK) is still perceived as a body with no real administrative weight established to conduct anti-corruption education and training and failing to fulfill its functions of holding liable those who commit corruption offences: during the latest parliamentarian elections held in 2020, the Agency, which was responsible for overseeing the financing of political parties and campaigns, showed a lack of will to process violations.

Many legal acts that were supposed to be adopted by the country to meet its commitments are still at the drafting stage.

Public procurement is also subject to high corruption risks: Montenegro has not implemented the Open Contracting Data Standard, which results in the publication of limited data about procurements by public institutions. 

As other countries, Montenegro does not have adequate mechanisms for the protection of the media. Moreover, last year there was backsliding as Montenegro’s parliament adopted an amended law on media that obliges journalists to disclose their sources upon request from the Prosecutor’s Office in cases that are “necessary for the protection of national security, territorial integrity and health”.

5. North Macedonia

At the summit, North Macedonia pledged to:

  • enhance the flow of information between the financial sector and the financial intelligence unit to provide law enforcement with intelligence; 
  • establish an independent and adequately resourced anti-corruption body;
  • strengthen asset recovery legislation;
  • ensure that the media are able to report on corruption issues in an objective and independent manner, in particular through publicizing the public accounts and assets of public officials;
  • ensure full implementation of the GRECO recommendations.

The authors of the report say that North Macedonia has made significant progress in implementing a number of its anti-corruption pledges so far. 

For example, software has been tested to register beneficial ownership of companies and its relevant bylaw has been adopted by the government. In addition, the Beneficial Ownership Register will be maintained and published.

Furthermore, the development of an “Open finances” online platform has created greater transparency on state finances.

Other important steps in redoubling the effort of the country in the fight against corruption included the provision of additional resources to the State Commission for the Prevention of Corruption (Државна комисија за спречување на корупција) by the government and the establishment of an asset recovery office in the Office of the Higher Prosecution.

However, despite the significant changes that the country has undergone, it has not implemented allGRECO recommendations as of yet. In particular, North Macedonia still has to establish an independent anti-corruption body and modernise its legislation on asset recovery.

6. Serbia

At the summit, Serbia pledged in the first place to: 

  • improve the flow of information to provide law enforcement agencies with the intelligence they need to detect and combat money laundering related to corruption;
  • develop legislation on public–private partnerships;
  • strengthen the capacity of anti-corruption bodies, judges and prosecutors;
  • adopt a new national anti-corruption strategy and create a national coordination body with effective mechanisms to monitor implementation of all preventive anti-corruption measures;
  • strengthen legislation for the confiscation of the proceeds of crime.

To implement these commitments Serbia adopted laws on the prevention of corruption and on public procurement and a code conduct for MPs. 

The country also implemented the measures to enhance the effectiveness of enforcement of the Law on the Protection of Whistleblowers (Zakon o zaštiti uzbunjivača: 128/2014-3): an important precedent here was the case of a high-profile whistleblower who had been dismissed for reporting on corruption and subsequently reinstated in his office. 

The authors of the report also praise the performance of the Agency for Prevention of Corruption (Агенција за спречавање корупције – АСК) in the area of anti-corruption education: in particular, the body carried out a few trainings on lobbying and adopted a training programme on prevention of corruption and public integrity, and the guidance for training delivery for public administration.

However, Serbia has not met a number of pledges it made. For instance, the country does not have a national anti-corruption strategy and relevant coordination body; measures to safeguard the media, NGOs and members of the Anti-Corruption Council (Savet sa Borbu Protiv Korupcije) from political pressure have not been adopted; and an adequate level of transparency of public procurement has not been reached.

Tags
Conflict of interest
AML
Corruption whistleblowers
Education
Asset recovery
Civil society
International cooperation
Transparency
Criminal prosecution

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