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A controversial law takes aim at Ukraine’s anti-corruption NGOs

New moves to make the work of Ukraine’s NGOs “transparent” only highlights how the fight against corruption is being undermined. 

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lead April 2017: the Ukrainian government holds a session on mid-term strategy for 2017-2020, Kyiv. (c) NurPhoto/SIPA USA/PA Images. All rights reserved. On 27 March, President Petro Poroshenko signed into law a series of amendments to Ukraine’s Law on the Prevention of Corruption. These amendments, which compel members of Ukraine’s anti-corruption NGOs to release financial declarations, immediately elicited a response from segments of civil society and investigative journalist community. In turn, this provoked a considerable backlash by political proponents of the amendments, as well as some segments of society who felt that the amendments would promote more transparency amongst NGOs involved in combatting corruption.

Opponents of the amendments have pointed, time and again, to their apparent underlying intent. José Ugaz, chairman of Transparency International, perhaps stated it best in proclaiming that: “These amendments are a vindictive retaliation by lawmakers who are angry that they are required to declare their wealth. There is no justification for singling out anti-corruption groups.”

A closer look at how the latest amendments targeting anti-corruption NGOs were passed and the individuals who are involved in the war on endemic corruption in Ukraine shows that, despite its proponents’ efforts to argue otherwise, their intent is to restrict, if not outright subvert the struggle to scale back corruption and establish permanent institutions to dismantle the entrenched infrastructure which undermines Ukraine’s democracy and sovereignty.

Opacity rules

The amendments in question add to one specific area of the Law on the Prevention of Corruption, namely the “e-Declarations Law” amendments, as they are colloquially known, which were passed in 2015.

The original “e-Declarations Law” (themselves a series of additions to the existing Law on the Prevention of Corruption) was devised to compel Ukraine’s public officials to declare all of their income and assets online in a forum that would be accessible to any member of the public. It was also designed to make the reporting requirements much more stringent, eliminating many of the loopholes so popular throughout the former Soviet Union in which public officials’ true wealth are hidden by passing off their true wealth to relatives or fictive companies.

It should be said that all previous laws and systems designed to promote transparency amongst state officials, as the ouster of ex-president Viktor Yanukovych shows, were utterly insufficient.

MPs, judges and prosecutors would casually arrive at work in luxury vehicles and reside in large, new homes, all the while claiming the property belonged to their spouse (or son or another relative). Few of them made more than a few hundred dollars a month, according to their official salaries. In reality, as investigative journalists made clear year after year, they were enriching themselves through their office and the considerable influence they could exert on specific segments of the economy or through fleecing the state budget.

These unprecedented steps to force public servants to expose their true wealth was met with obstacles at nearly every turn

The solution devised to combat the nationwide, almost unfathomable level of corruption by MPs, judges, senior civil servants and so on was to subject them to public scrutiny and empower the public to hold them accountable — a task far too great for a couple dozen NGO researchers or the country’s seriously underfunded (and newly founded) independent anti-corruption agencies. 

These unprecedented steps to force public servants to expose their true wealth was met with obstacles at nearly every turn, whether formal political pressure, a delay in providing official certification for declarations filed, or the ongoing series of technical issues which have plagued the system since its launch. When the e-declaration’s website was finally launched in September 2016, questions about its true value, potential effectiveness and, in some quarters, the extent to which it was an invasion of privacy, were still being discussed. 

13 March: a Kyiv court upholds pretrial detention for Roman Nasirov, Ukraine's former tax and customs chief, who is being investigated on fraud charges. (c) NurPhoto/SIPA USA/PA Images. All rights reserved.Soon, however, Ukraine’s public officials began to declare what appeared to be their actual income and assets. In the first round of declaration submissions, 410 Ukrainian MPs declared monetary assets that totaled roughly $470m in currency. While some MPs, including some of the country’s wealthiest businessmen, held large sums of cash in various currencies, this provided the Ukrainian public with the first true public accounting of what its elected officials — who often campaign on populist slogans — are really worth.

And while it may not have convinced the public that the current salary for MPs (which hovers around $200 a month, depending on the exchange rate of the national currency) is insufficient to live on, it does expose them to the reality of who is representing them — and perhaps gives them pause as to why. 

A question of intent

The e-declaration amendments are not without their flaws. Like much of Ukrainian legislation, which is either poorly formulated (intentionally or unintentionally), it requires revision and refinement so as to not contradict itself or be feasible for actual implementation.

One such revision, passed on 20 December 2016 by the Verkhovna Rada, amended the Law on the Prevention of Corruption to reduce the number of entities that would be required to file a declaration, a move that was widely seen as sensible given the sheer number of public servants who had minimal salaries and were unlikely to be purveyors of large scale corruption schemes. This move made sense insofar as it helps the newly created anti-corruption institutions focus on serious players who are much more likely to benefit from their positions than low-level regional bureaucrats. 

However, in recent months, there has been a number of strange moves by members of the ruling parties in Ukraine’s parliament to attempt to, by all appearances, hamper further genuine anti-corruption reform. There are several signs that the authorities are interested in gradually creating avenues to potentially limit the effectiveness or reduce the level of public confidence in the newly created independent anti-corruption institutions and systems of transparency, as well as the civil society that has pushed so stridently for their creation.

20 March: protesters don costumes to ridicule candidacy of Nigel Brown, an otherwise unknown UK citizen, for the position of NABU auditor. Source: LB.ua.The recent attempt by unnamed parties to push through, in violation of several parliamentary procedures, a virtually unknown UK national to become the Auditor of the National Anti-Corruption Bureau (the Auditor is the sole individual capable of firing the bureau’s director), alerted civil society, independent media outlets, embassies and observers to a potential rollback on deeper institutional reform.

Although this move was ultimately unsuccessful, it demonstrated that Ukraine’s authorities were attempting to go back to their old ways of simply creating a façade of reform and transparency, while quietly undermining the institutions and processes meant to ensure them.

Silencing the combatants of corruption

Key to understanding this painful reality are a series of clauses  that amend Ukraine’s Law on the Prevention of Corruption. They specifically target individuals and representatives of “anti-corruption” organisations that are involved in any activities which are related to the prevention or counteraction of corruption.

The absence of a precise definition (or any definition at all) of what “anti-corruption activities” entails, or which individuals or entities are subject to this law, drew the ire of both NGOs and donors alike. These concerns stem from the openings these amendments leave for the authorities to use the law’s ambiguous language to intimidate or prosecute NGOs, activists or journalists according to their own subjective interpretation of the law. 

23 March: two MPs from Petro Poroshenko Bloc vote for amendments to the law on combating corruption on behalf of absent colleagues.

Perhaps the most damaging aspect of law is that it requires any contractors or service providers who work with civil society entities involved in anti-corruption, or receive technical assistance (foreign aid) towards that end, to also file declarations for the public to view. Essentially, this would mean that anyone who engages in any form of business or provides any services — whether it be providing printing services or translations of documents — would also fall under the auspices of this legal requirement. This would clearly disincentivise any public organisation, private business or individual from wanting to formally work with an NGO whose work may lead to them making public their private individual information.

President Poroshenko, heeding the call of leading anti-corruption activists and organisations, held a meeting to listen to their arguments against his signing a series of amendments to the Law on the Prevention of Corruption which were passed by parliament on 23 March. The amendments, it should be noted, were passed with two MPs caught on camera breaking the constitution by illegally voting for absent MPs.

Shortly after speaking with them on 27 March, Poroshenko signed the proposed amendments into law, citing the need to support the clauses that removed the requirement for certain members of the military to file declarations. He also called for the creation of a working committee and stated that as the law would only come into effect in 2018, this would give all parties plenty of time to resolve any outstanding issues.

In an allegedly leaked document, first reported by Ukrainska Pravda, the Presidential Administration carefully outlines how to respond to criticism of the amendments that target NGOs working in the field of combatting corruption. 

Scan of alleged talking points memo that outlines how the amendments against anti-corruption NGO should be discussed. Read it in full here via Ukrainska Pravda. Voices that have come out in support of the disturbing “anti-corruption” clauses have focused mainly on the principle that “it is only fair” if the vaguely defined “anti-corruption” organisations and individuals be subjected to the same standards of transparency they have demanded of public officials.

These arguments, which slyly play on some popular sentiment and obfuscation of Ukrainian law and western norms, as well as NGOs current legal financial reporting responsibilities, are an attempt to equate public officials (whose salaries are paid by taxpayers) with private individuals. They also conveniently align with many the talking points outlined in the leaked document listed above.

Whataboutism revisited 

The point of the argumentation and language described above is to obscure the whole purpose of establishing an open record (e-declarations) of public servants’ incomes and assets — namely, to enable the Ukrainian public, journalists and civil society to hold officials accountable. It will also open the door to a return of a previous era in which officials and politicians played on the distrust of the public towards foreign governments and their real motivation for giving money to Ukrainian civil society.

It is not civil society that has mired Ukraine in corruption since its independence, but rather its absence

Ukrainian civil society, and the NGOs that have long been its backbone, is not responsible for the fleecing of the nation’s wealth or its potential over the past 26 years. If more stringent financial reports by NGOs, most of whom publish annual reports and place them on their public websites, are something the Ukrainian public truly wants, then a reasonable and practical legal framework can be developed. Many of the NGOs who are arguing against the amendments, and the foreign donors that support them, have publicly welcomed discussing improving their organisational financial transparency. 

Observers shouldn’t ignore the obvious current attempts to deflect attention away from the lack of a single serious corruption conviction by Ukraine’s post-Maidan authorities or follow through on implementing deep and comprehensive anti-corruption institutional reform.

It is not civil society that has mired Ukraine in corruption since its independence, but rather its absence.

This article is published in association with the Westminster Foundation for Democracy, which is seeking to contribute to public knowledge about effective democracy-strengthening by leading a discussion on openDemocracy about what approaches work best. Views expressed herein do not necessarily reflect those of WFD. WFD’s programmes bring together parliamentary and political party expertise to help developing countries and countries transitioning to democracy.

 


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