The reform is above all aimed at putting in place an effective system of corruption prevention grounded on public order, proper management of public affairs and property, scrupulous integrity and robust civilian oversight.
Corruption has long been regarded as Ukraine’s major problem and the subject of much debate, both nationally and internationally.
According to the 2018 Corruption Perception Index (CPI) published by Transparency International drawing on surveys of businesspeople and expert assessments, Ukraine is ranked 120 out of 180 countries. And although Ukraine’s ranking keeps improving every year, such a state of affairs is still far from being acceptable. According to numerous analytical reports and surveys, it is corruption that poses the biggest problem for both foreign and domestic businesses. Among the apparent problems triggered by high levels of bribery and abuse of office are destruction of the system of social values and absolute distrust in public authorities, which ultimately result in negative economic consequences, increase inequality and slow down household income growth.
The implementation of the fundamental anti-corruption laws that establish harsher administrative and criminal liability for breach of property and income declaration requirements has brought prevention and combat of corruption to a whole new level.
Ukraine’s e-declaration system has gained both national and international recognition as a groundbreaking phenomenon in terms of both technology and scale.
This is confirmed by the fact that the EU anti-corruption authorities (such as the Central Anti-Corruption Bureau of the Republic of Poland, National Integrity Agency of Romania and Anti-Corruption Agency of the Republic of Serbia) have been showing a growing interest in taking in a Ukrainian experience in administering and using an e-declaration system.
The e-declaration system is one of the pivotal mechanisms to prevent and an effective instrument to detect corruption. Above all, it allows the public to inspect assets of public officials and civil servants who receive their pay out of the State Budget and promotes zero tolerance and negative public attitude towards corruption.
Therefore, it is indisputable that electronic declarations contained in the Unified State Register of Declarations of Persons Authorised to Perform the Functions of the State or Local Governments (the “e-declaration register”) are a source of information for both competent anti-corruption authorities and civil society activists to detect corruption. This substantiates the EU requirements for the proper operation of the e-declaration system and verification of declarations.
Further technical improvement of the e-declaration register will reduce the time for receipt of information required to verify declarations and cut the red tape in the verification process, which, taken together, will significantly increase the effectiveness and efficiency of the monitoring the financial standing of persons authorised to perform the functions of the state or local governments.
All in all, the year-end 2018 saw more than 1,256 million registered users and more than 2,885 million filed electronic documents including more than 2,457 million e-declarations, around 313,000 modified e-declarations and nearly 115,000 reports of material changes in a declarant’s assets.
Declarants have been showing a more responsible approach to the completion of declarations and their timely submission, and have been making fewer common mistakes with each declaration stage.
The effectiveness of the National Agency for Prevention of Corruption (“NAPC”) in verifying declarations of public officials and checking the timely submission of declarations and reports of material changes in a declarant’s assets has increased alongside the declarants’ disciplined approach. Last year’s results show that compared to 2017 the number of decisions following a complete declaration check has more than tripled and reached 472, the number of administrative offence reports drawn up subsequent to financial oversight and forwarded to court has increased almost sevenfold to 310, while the number of substantiated opinions forwarded for pre-trial investigation to law enforcement agencies has increased twelvefold to 243.
To increase the effectiveness and efficiency of complete declaration checks, NAPC has introduced an e-declaration verification system. In addition, the declaration arithmetic and logic control system was commissioned into operation, rules governing such control were revised and approved, and complete declaration check procedure was amended as necessary.
It is expected that the automation of information collection for complete checks will contribute to increase in their number amid automated e-declaration control and data exchange with public registers.
The operation of the e-declaration control system involves automated exchange of information with 16 registers and databases of Ukrainian public authorities. NAPC has already approved the automated information exchange rules and procedures to have access to 13 public registers. The enactment of bill No. 7276, which was introduced to Parliament already in November 2017 but, unfortunately, still remains pending, will enable the launch of automated information exchange with the three key registries of the Ministry of Justice (State Register of Civil Status Records, Unified Register of Powers of Attorney, and Register of Deceased Estates).
As rightly said by Dr. T. Hoppe and Dr. V. Kalninsh in their assessment of NAPC’s e-declaration check performance conducted with the support of the European Union Anti-Corruption Initiative (EUACI), Ukraine’s Parliament, Ministry of Justice and other ministries (register and database holders) greatly affect NAPC’s performance and share responsibility for its success or failure.
Since the beginning of 2019, NAPC has commenced 600 complete declaration checks with the use of declaration arithmetic and logic control system.
Low integrity of some public officials, abuse of authority, lack of critical attitude of most Ukrainians towards petty corruption and perception of bribery as an efficient means of solving problems are among the main factors contributing to corruption and adding complexity to its eradication.
Recent years have seen holistic efforts towards implementing the local anti-corruption policy (anti-corruption programmes) planning system based on corruption risk assessment results. NAPC approved the corruption risk assessment methodology as a designated authority responsible for the formulation and implementation of the national anti-corruption policy and conduct of the relevant preventive measures.
In 2018, 97% of all public authorities set up corruption risk assessment committees with the active involvement of the public and experts, while NAPC received 129 anti-corruption programmes of which 115 were approved subject to comments and proposals.
All anti-corruption programmes are placed on NAPC’s website. The public and experts contribute to their development by providing content proposals.
NAPC’s other preventive functions are to monitor and control compliance with laws governing ethical conduct, prevent and resolve conflicts of interest affecting persons authorised to perform the functions of the state or local governments and persons equated to them, and supervise compliance with anti-corruption restrictions.
The year 2018 saw 471 administrative offence reports drawn up and referred to court in relation to breach of applicable legal requirements based on information received from natural persons and legal entities compared to 159 in 2017. In addition, 97 improvement notices for breach of applicable ethical conduct standards, prevention and resolution of conflicts of interest and other non-compliances were issued to executives of respective agencies, enterprises, institutions and organisations.
NAPC has drafted the Bill On Amendments to Some Legislative Acts of Ukraine to Prevent Corruption subsequent to analysis of the Law of Ukraine On Prevention of Corruption and applicable case law.
The enactment of the bill will help improve the existing corruption prevention mechanisms by raising integrity standards for persons authorised to perform the functions of the state or local governments, persons equated to them, and civil society, and streamline the procedure for prosecution of those who have committed corruption-related offences.
NAPC has also drafted the Bill On Whistleblower Protection to improve corruption whistleblower protection mechanism.
In addition, there was drafted a bill to enhance the role of designated corruption prevention and detection units (officials) clearly setting out their status, mandate and mechanisms for protection against unmotivated dismissal.
As a preventive authority, NAPC places particular emphasis on training civil servants and the public.
With the support of the UN Development Program in Ukraine, NAPC designed 4 online courses published on Prometheus (a public project of open online mass courses) — "Anti-Corruption Programs of Government Agencies", "The Conflict of Interest — A Must Know!", "The Conflict of Interest — A Must Know! From Theory to Practice", and "Declare with Integrity". These courses are intended to disseminate theoretical and practical knowledge among people authorized to perform the functions of the state or local government, units (officials) in charge of preventing and detecting corrupt practices, experts and everyone interested in and willing to contribute to the anti-corruption reform.
To this end, NAPC also conducts regular training on all areas of its activities, offers written and verbal clarifications, drafts guidance on anti-corruption compliance.
For example, NAPC offered nearly 12,000 verbal consultations and about 2,000 written explanations in 2018.
That year, NAPC received about 5.5K reports from individuals and companies regarding alleged violations of anti-corruption laws, which is much more than in the preceding years. These statistics demonstrate that the public is not indifferent to corrupt practices and is becoming more actively involved in the anti-corruption reform.
Apart from regular training for persons authorized to perform the functions of the state or local government, units (officials) in charge of preventing and detecting corrupt practices, NAPC delivered a number of awareness-raising programs and information campaigns that engaged not only representatives of government agencies, but also non-governmental organizations, regional and central media covering the prevention of corruption.
To make representatives of state-owned and private enterprises more aware of business integrity, and to present best practices of the implementation of anti-corruption programs at legal entities, the UNDP in Ukraine and the All-Ukrainian Network of Integrity and Compliance supported by NAPC and the Business Ombudsman Council held integrity and compliance workshops in 8 regional centers titled "Business Integrity: Join, Put into Action, and Win".
State Bureau of Investigations (SBI) is a law enforcement agency that Ukraine has been expecting for over 20 years. As it becomes active, pre-trial investigation functions pass from the prosecutor's office to SBI, and the prosecutor's office only keeps the oversight function. This is a standard approach of an objective and unbiased investigation. SBI's investigative jurisdiction includes top officials, judges, law enforcement officers, and people suspected of military crimes. I.e., these are mostly people who can influence criminal proceedings and avoid punishment.
The Bureau's processes were streamlined in 2018, over 500 officers joined it through competitive selection, including 285 investigators. The building of the regional network was underway, too, with SBI opening regional administrations in Kyiv, Kramatorsk, Lviv, Melitopol, Mykolaiv, Poltava, Khmelnytskyi, and adopting their regulations and annual programs.
As of January 1, 2019, the State Bureau of Investigations as a law enforcement agency was conducting pre-trial investigations into more than 2,400 criminal cases, including 569 commenced by the Bureau's investigators. 70 criminal cases were passed on to the court.
The National Agency for Finding, Tracing and Management of Assets Derived From Corruption and Other Crimes (ARMA) was created to address the issue of the ineffective uncovering of assets derived through crime and corruption. ARMA's creation and operation was one of key requirements of the Visa Liberalization Action Plan as part of the Ukraine–EU visa-free dialog.
Effort was made in 2018 to complete the creation of ARMA's functional capacity to perform its functions of finding, tracing, and managing assets. For example, ARMA's central office was staffed, and six regional administrations set up.
A full cycle of seized asset management was performed last year, with ARMA assuming management of assets and later returning them to their owner.
Different types of seized assets (properties, vehicles, equity rights) were transferred to managers for management and yields achieved at a level adequate for their maintenance until subsequent confiscation or restitution to their owners.
During that year, ARMA secured more than UAH 9 mln in revenues for the State Budget of Ukraine from seized asset management and an additional UAH 3.1 mln in proceeds from seized assets.
Anti-corruption is one of the most challenging and comprehensive reforms that the Government is undertaking today. Fighting corruption is a component running like a golden thread through all Ukrainian reforms, from health care to energy independence. Therefore, producing positive communications to keep the public aware of real outcomes of the implementation of the anti-corruption reform and build trust in government institutions is a vital component of the anti-corruption reform.
To ensure effective communications, NAPC adopted the 2018–2020 Communications Strategy in 2018 and wages a number of information campaigns involving the media to identify its target audiences. In addition, last year the Government approved the action plan for implementation of the 2019 Communications Strategy in the area of Preventing and Fighting Corruption.
The key goal of communications is to raise the awareness of the public and businesses regarding their personal responsibility for corruption, ways of avoiding and uncovering corrupt practices.
In line with its Anti-Corruption Strategy, NAPC conducted a number of awareness-raising events targeted at different social audiences.
For example, it delivered a master class on anti-corruption literacy for central and regional media, a master class "The Conflict of Interest — A Must Know!" for representatives of anti-corruption non-governmental organizations, an information campaign for students in the form of public lectures to explain anti-corruption laws and carry out preventive anti-corruption activities, an anti-corruption lesson "What NAPC is doing and what children can do to prevent corruption" as part of the Doors Open Day for senior students of Kyiv secondary schools.
A number of integrity and compliance workshops were taught for public and private companies, anti-corruption training for the military and law enforcement officers in the ATO area and for heads of district state administrations.
24 training sessions were delivered in Kyiv and regionally for authorized units (officers) in charge of preventing and detecting corrupt practices, Legal and HR offices of government agencies on topics such as "Legal Aspects of Anti-Corruption Effort" and "Electronic Declarations".
In addition, an online course into "Anti-Corruption Programs of Government Agencies", an advanced course titled "The Conflict of Interest — A must Know! From Theory to Practice", and "Declare with Integrity!" have been created. The courses start on Prometheus, a public project of open mass online courses.
In October 2015, the Verkhovna Rada of Ukraine adopted the Law of Ukraine On Amending Certain Legislative Acts of Ukraine on Prevention of Political Corruption, which introduces public funding of parties from July 1, 2016 in proportion to their electoral support.
This decision gave impetus to positive tendencies in the activities and funding of political parties in that they are now able to reject funding by oligarchs and avoid having to seek powerful sponsors, started building their regional networks (with regional cells springing up) which truly work with the electorate. Prospects emerge for the development of new political projects, sanctions have been introduced for violations of laws on the financing of political parties.
Following analysis of political parties' statements of property, income, expenses and financial liabilities, NAPC drew up 401 records of administrative offenses for political corruption violations in 2018 (compared to 264 in 2017).
Based on a review of such materials, courts ordered UAH 401,276 in fines and UAH 289,436 in seized unlawful contributions (UAH 311,100 and UAH 1,214,690, respectively, in 2017).
A further improvement in state control of partisan finances will make them more transparent and limit the influence of private capital.
For example, the Law of Ukraine On Amending Certain Legislative Acts of Ukraine on Improving the Procedure of Holding Liable for Violations Involving Financial Support to Political Parties and Their Financial Statements was drafted and proposed to the Verkhovna Rada of Ukraine for consideration in 2018. When passed, it will introduce effective, proportional, and efficient sanctions for partisan finance violations and make administrative liability for them inevitable.
So far, NAPC continues work initiated by it on creating an information and telecommunication system, the Unified State Register of Statements of Political Parties and Candidates, that will make statements transparent and automate the audit of statements of parties and candidate members of parliament.
the Ministry of Justice of Ukraine, the National Agency for Prevention of Corruption, the National Anti-Corruption Bureau of Ukraine, the State Bureau of Investigations, the Asset Finding and Management Agency, the European Union Anti-Corruption Initiative in Ukraine, the Ministry of Foreign Affairs of Denmark, the UN Development Program, Transparency International Ukraine, EIDOS, International Renaissance Foundation