The report summarises outcomes of the fourth round of Istanbul Anti-Corruption Action Plan (IAP) monitoring that covered Armenia, Azerbaijan, Georgia, Kazakhstan, Kyrgyzstan, Mongolia, Tajikistan, Ukraine and Uzbekistan. Overall, the document states that corruption remains high in the region of Eastern Europe and Central Asia: in spite of the fact that governments have undertaken reforms to tackle corruption, empirical data and perception surveys show that countries have not fully aligned their laws with the international standards.
Here below is a review of some of the achievements and persisting challenges in the fight against corruption in the aforementioned countries whose analysis is provided in the report.
Anti-Corruption policy and institutions
I) Anti-corruption policy development
On the one hand, the OECD experts register certain progress in planning before the development of anti-corruption policies. In particular, some countries sought to improve the quality of primary data for further anti-corruption planning: for example, Mongolia had a practice of using surveys to identify challenges; Azerbaijan used analytical data obtained through criminal investigations to inform its policy documents. Some countries were introducing risk assessments in certain sectors: Armenia chose to focus on four priority sectors (education, taxes, service delivery in the police and health sector), conducted risk assessments and developed action plans for these sectors.
On the other hand, strategies continued to lack solid evidentiary basis and risk assessments were rare. In developing policy documents, the Governments usually used research conducted by NGOs and other stakeholders that might lack impartiality and evidence. Moreover, the quality of monitoring mechanisms remained poor: the monitoring was largely based on administrative data gathered from implementing agencies rather than on objective criteria and benchmarks. However, even if there were due monitoring and control mechanisms, competent authorities often lacked funding to employ them in practice. This is why the National Agency for Corruption Prevention of Ukraine could not evaluate impact of anti-corruption reforms in line with its corruption research methodology on a regular basis.
The OECD experts conclude that at present the IAP countries are mostly focused on the formal attainment of the objectives set out in planning documents, rather than on the real outcome of enforcement of respective measures.
II) Anti-corruption awareness raising and education
The report notes that most IAP countries had mechanisms for raising public awareness about corruption and anti-corruption measures. For example in Mongolia, in the framework of “A Different Future” campaign («ӨӨР ИРЭЭДҮЙ») for youth, which was initially focused on combating negative social phenomena, an anti-corruption education initiative with a paper clip as its symbol was launched. In Ukraine, in order to raise awareness about conflicts of interest the Methodological Guidance on the Prevention and Management of Conflict-of-Interest Situations was issued and a series of training courses for national executive bodies, regional and local administrations, members of parliamentary assemblies and employees of local government authorities were held. Some countries either held anti-corruption learning courses for school and university students or integrated respective subjects in curricula.
However, the meaningful impact of these measures is unclear, as they still generally lack a systemic approach and proper assessment of the outcome. There are few countries that have mechanisms for assessing the impact of awareness-raising initiatives, such as the awareness-raising and culture formation programme in Kazakhstan.
III) Anti-corruption bodies
The institutional model of anti-corruption bodies in most IAP countries implies their deliberative structure (council, commission or committee) or, in some less frequent cases, a specialised body or public entity whose main function is to prevent corruption and, in some cases, to coordinate the fight against corruption at the national level: Anti-Corruption Council in Georgia, National Council of Tajikistan on Prevention of Corruption, Armenia’s Anti-Corruption Council, etc. In some countries (Mongolia, Kazakhstan and Azerbaijan) the national anti-corruption body has not only prevention but also enforcement functions in the field of anti-corruption.
However, the OECD experts highlight that in many cases these entities still lack funding and human resources, as well as credibility and independence which impedes an effective fulfillment of their functions. In Azerbaijan for instance, the secretariat of the anti-corruption body of just four employees is responsible for the coordination of over a hundred of sectoral plans and anti-corruption activities in all public bodies at the national and local levels. In Mongolia, the law provides for the criteria for selecting the head and the deputy head of the Independent Authority against Corruption, but it does not clarify the procedure for their selection and appointment. As a result, this process became biased and non-transparent, there were numerous attempts to dismiss the head and the deputy head of the Agency without any legal grounds and they were constantly pressurised by the ruling elite. In some cases, anti-corruption bodies do not use in practice the powers they have “on paper”: for example, Azerbaijan’s Commission on Combating Corruption is entitled to coordinate anti-corruption activities and adopt a wide range of corruption prevention measures, but in fact the only thing it does is the development of anti-corruption policy.
Another challenge is accessibility and visibility of information on the performance of these entities. Most countries do not have any instruments for regular assessment of their effectiveness.
Prevention of corruption
I) Integrity in the public service
The report stresses that all countries in the ACN region have identified public sector integrity as one of the key priorities of their anti-corruption strategies/policies and/or civil sector reform policies in the previous years; they have established objectives of merit-based recruitment, promotion and remuneration. At the same time the authors of the report underline that it is not clear if transition economies need a civil service based exclusively on merit: experience of some countries demonstrates that during large-scale reforms also in the field of anti-corruption this professional stability may be an obstacle.
In the ACN region, the principles for abiding by anti-corruption standards in the public sector are normally provided for by codes of ethics. However, in most cases these codes either contain only general terms or are outdated. What is more, officials are not duly trained on how to observe them.
Since the second round of monitoring the IAP countries have started to consistently introduce new provisions on whistleblowing which is of primary importance for ensuring public integrity. They have also adopted measures to engage civil society and civil servants in these activities. Over the reviewed period such countries as Kyrgyzstan, Ukraine and Uzbekistan adopted laws on whistleblower protection, meanwhile Armenia, Georgia and Kazakhstan established reporting channels. Some countries, including Kazakhstan, Kyrgyzstan and Ukraine adopted legislative provisions on financial rewarding of whistleblowers.
Management of conflict-of-interest situations is another important component of public integrity policy. The report stresses that all reviewed countries except for Azerbaijan have relevant legislative provisions. As a rule, they are integrated in the laws regulating civil service and/or the laws on countering corruption with Kyrgyzstan and Mongolia having specific legal acts on conflict of interest. However, the authors of the report believe that this legislation is still far from perfect: for example, Mongolia amended the law to allow appointment on civil service positions in the situations of conflict of interest; in Georgia, the conflict-of-interest provisions did not cover the employees on labour contracts and majority of the employees of the Legal Entities of Public Law (public entities established in accordance with a law, decree or other legal act; they are independent from public bodies and conduct political, government, social, educational, cultural or other public activities); in Kazakhstan, the retaliation measures for the violation of conflict-of-interest provisions are considered as ineffective. The management of conflict-of-interest situations is normally conducted by specialised anti-corruption bodies or ethics commissions: for example, in Georgia these functions are assigned to their internal audit units, in Mongolia, this responsibility rests with the Independent Authority against Corruption (except for the conflict-of-interest situations of MPs and judges). However, the authors of the report highlight that the implementation of respective provisions remains unsatisfactory.
Some countries of the ACN region have made progress in asset and interest disclosures. For instance, Georgia introduced a system of verification of declarations (to this end, a separate department of eight officers was established within the Bureau of Public Service); Ukraine launched a fully electronic system of submission and disclosure of comprehensive asset and interest declarations. However, other countries did not achieve any progress in this field: Kazakhstan further delayed the introduction of a new disclosure system; in Azerbaijan, the form of asset declarations has not been adopted for 15 years and after relevant legislative provisions have been approved the implementation has yet to start.
V) Business integrity
Strategic anti-corruption documents of only four reviewed countries of the ACN region have provisions on ensuring business integrity: in Georgia for example, the necessity to do so is included in the Anti-Corruption Action Plan.
The report states that large businesses in the reviewed countries were largely controlled by oligarchs, family clans, and corrupt politicians, criminal or other interest groups, whilst legal uncertainty, selective application of the law by judiciary, insufficient development of competitive environment and poor protection of property rights were the top business risks in the region.
Corruption is generally nourished by “overregulation” of business. At the same time a progress in regulatory simplification was registered in the ACN region: Tajikistan adopted a risk-based system for inspections using IT solutions and data analysis; the number of permits and licenses in Kyrgyzstan was reduced from 586 in 2012 to 98.
The use of e-tools and open data boosted across the region and contributed to promoting integrity. The report cites such examples as e-procurement system ProZorro in Ukraine, e-portal (in Georgian) for reporting corruption in Georgia, public access to the registry of beneficiary ownership of companies in Ukraine, and disclosure of beneficial ownership in connection with the public procurement for the winners of tenders in Armenia.
The report says that the reviewed countries barely applied measures for encouraging companies to introduce compliance programmes (although, Kyrgyzstan was considering setting up “green corridors” in the customs, in registration, at the tax service and in the public procurement system for companies that developed compliance programmes). The leniency programme of the Anti-Monopoly Committee of Ukraine can be considered as an exception: a company can be relieved of responsibility for anti-competitive behaviour under specific conditions for example, when the company self-reports its involvement in a collusion and cooperates with investigation.
In spite of the fact that business shows scarce commitment to introducing compliance programmes, governments of the reviewed countries demonstrate interest in their certification: to this end, Ukraine established in 2016 Ukrainian Network for Integrity and Compliance (UNIC), however no companies have yet been certified by it.
Enforcement of criminal responsibility for corruption
I) Criminal law against corruption
Despite the extensive reform process of criminal law so as to ensure that its provisions are in line with international standards, criminalization of corruption in the reviewed countries is still associated with many problems.
For instance, some countries of the ACN region still impose administrative sanctions for corruption offences also in the event of their “overlapping” with criminal sanctions. In Uzbekistan for example, the criminal law applies if the person was punished for the same offence with an administrative sanction prior to committing the same offence.
Several IAP countries have established a category of “corruption crimes”, however not all of these crimes constitute “corruption” in a strict sense or may not be even related to corruption (for instance, “misappropriation of weapons using one’s office” and “misappropriation of various types of drugs using one’s office” in Ukraine or “smuggling when committed by a public official” in Kazakhstan). Several IAP countries (Armenia, Tajikistan, Ukraine) established a separate offence of bribery in sport.
However, not all IAP countries have criminalised not only passive and active bribery but also the promise, offer or request of a bribe, whilst intangible and nonpecuniary advantage are considered as an element of a bribery offence only in Armenia, Azerbaijan, Georgia and Ukraine.
Trading in influence is criminalised only by Armenia, Azerbaijan, Georgia and Ukraine, whilst illicit enrichment is a crime in Armenia, Kyrgyzstan, Mongolia and Ukraine.
Criminal liability of legal persons for corruption is established in Georgia and Mongolia, and is also provided for by new draft criminal codes of Armenia and Uzbekistan; Azerbaijan, Kyrgyzstan and Ukraine have quasi-criminal liability of legal persons.
II) Procedures for investigation and prosecution of corruption offences
Some countries of the ACN region conduct analysis of information of government-held registries and databases (Ukraine), risk profiles (Georgia) or previous cases and complaints (Azerbaijan), as well as media reports (Ukraine, Mongolia) to detect manifestations of corruption offences. Criminal investigations may be commenced based on anonymous communication in Georgia, Ukraine, Kyrgyzstan and Mongolia. In Armenia, Kazakhstan and Uzbekistan anonymous complaints may be used for intelligence gathering and result in opening of a criminal investigation. Information from financial intelligence units is not widely used in the ACN region, which is primarily due to inadequacy of the mechanisms of interaction between these units and law enforcement authorities.
IAP countries have adopted different approaches to time limits which are usually applied to investigations: for example, in Armenia maximum possible duration of an investigation is not limited, in Tajikistan it is one year, and only two months in Kyrgyzstan. At the same time, law enforcement bodies may often have limited possibilities to conduct investigations, for instance, because of difficulties in getting access to registries and databases or confidential character of information (for instance, investigative bodies in Ukraine found themselves unable to use one of the special investigative techniques - the monitoring of bank accounts that allowed covertly observing financial transactions on specific bank accounts because this instrument constitutes a State secret, which prevents the disclosure of its details to banks’ employees).
III) Enforcement of corruption offences
In general, most corruption offences in the region were detected in the traditionally vulnerable to corruption areas, such as public finances, natural resources, administrative services (issuing permits, licences etc.), public procurement, tax and customs, health and education. In terms of types of corruption offences, the most commonly detected were embezzlement of public funds, forgery and abuse of official authority.
In some IAP countries the official statistics on corruption offences became available for the public, for example, in Kazakhstan free online access to periodically updated detailed statistical information on criminal and other corruption offenses was provided on the website of the Anti-Corruption Service; conversely, in other countries (Kyrgyzstan, Uzbekistan) the official criminal statistics on corruption offences were not publicly accessible.
Predictably, tackling high-level corruption remains a challenging task for many countries in the region. Law enforcement agencies in such jurisdictions still tend to investigate petty corruption far more often than high-profile cases.
IV) Anti-corruption criminal justice bodies
As regards institutional solutions in terms of anti-corruption law enforcement, the models of specialisation of competent bodies in the IAP countries can be divided as follows:
- stand-alone specialised anti-corruption law enforcement bodies (Azerbaijan, Ukraine);
- anti-corruption specialisation within the existing law-enforcement and/or prosecution bodies (Armenia, Georgia, Kyrgyzstan, Uzbekistan);
- multi-purpose anti-corruption specialised agencies that combine preventive and repressive powers (Mongolia, Tajikistan).
One of the primary concerns about the entities that investigate corruption is lack of independence, operational autonomy and financial and human resources. In Mongolia for example, the national anti-corruption authority is legally eligible to create its regional offices, but it has been denied funding to do so and had to rely on the police to carry out corruption investigations in the regions far-removed from the capital city. Ukraine’s anti-corruption body has been under the constant pressure from the ruling elites, which included attempts to amend legal provisions on dismissal of its director, initiation of criminal investigations against both its detectives and top management.
Therefore, despite considerably high corruption in the region, the IAP countries continue to search for effective anti-corruption mechanisms and undertake relevant reforms. The fourth round of Istanbul Anti-Corruption Action Plan monitoring showed that serious institutional challenges in the field of countering corruption persist in most jurisdictions: some countries have already fully aligned their laws with the international standards, many measures that are being adopted are purely formal, specialised bodies lack resources and independence, etc. At the same time, almost every country under review has made certain progress: transparency and accountability are generally enhanced, ICT are employed to prevent corruption (for example, e-procurement), attempts to use risk-based approach and data analysis to inform the development of anti-corruption strategies and law enforcement are made, new educational initiatives are launched, etc.
