There is little chance that the political environment will improve in 2018 for strong reform and a strong fight against corruption, as politicians are becoming consumed by the 2019 presidential and parliamentary elections.
At the same time, in the next two years, Ukraine will need to repay more than $3 billion in debt to the International Monetary Fund, a circumstance that will hopefully increase the leverage of Western partners to ensure that Ukraine’s leaders wage a genuine fight against corruption.
2017 in review
For the first time ever, dozens of top Ukrainian officials were charged with corruption crimes based on evidence. But Ukraine’s political elites are constantly attacking anti-corruption accomplishments.
The National Anti-Corruption Bureau of Ukraine is currently investigating more than 450 cases of corruption in all branches of power and state-owned enterprises. Even the mere existence of an independent investigation helps eliminate corruption schemes.
After an embezzlement case against member of parliament Oleksandr Onyshchenko was announced involving state-owned company Ukrgazvydobuvannia, the gas producer suddenly reported Hr 162 million in profit in four months. Its previous high was only Hr 25 million over two years.
Unprecedented transparency was implemented in public administration with more than 1 million officials having disclosed their assets in the e-declarations system.
International medicines procurement helped to save up to 38 percent of the procurement budget while providing a better supply of medications.
The establishment of a separate anti-corruption court was brought back on the agenda thanks to the supportive opinion of the European Commission for Democracy through Law, better known as the Venice Commission.
A new asset recovery agency was kicked off and received its first seized assets for management.
However, it took a lot of effort to protect reform. Although major backsliding attempts were stopped, almost no progress was made with remaining issues.
After a number of headline cases announced by the National Anti-Corruption Bureau of Ukraine, or NABU, the political elites from different parties teamed up in undermining the institution.
Judicial reform did not meet public expectations with dubious candidates appointed to the new Supreme Court.
The selection of the management of the new State Bureau of Investigations ended up with the transfer of people there with dubious reputations from the General Prosecutor’s Office.
The e-declarations campaign, requiring public officials to declare their income and assets, was not followed by anybody being brought to account for illicit enrichment. Moreover, declarations of all Security Service of Ukraine staff, including public figures, were unlawfully hidden not only from the public, but also from NABU.
Attacks on reformers intensified all over Ukraine.
And, as a Christmas gift, President Petro Poroshenko submitted to parliament a draft law on an anti-corruption court that neglects key Venice Commission recommendations.
Given last year’s worrying tendencies, 2018 anti-corruption agenda will consist of two key tasks: preventing anti-corruption rollbacks and moving forward.
Agenda for 2018
#SaveNABU
There is no glimpse of hope that a well-orchestrated war against NABU will stop soon. NABU is being attacked on a few fronts.
Several draft laws aimed at establishing political control over NABU and/or limiting its powers lay in parliament, waiting for the good moment to be pulled out. Although it triggered an unprecedentedly sharp international reaction, the scandalous draft law No. 7362, which would make it easier to fire the NABU director for political reasons, political reasons is still in the Rada. Further manipulations with the appointment of a loyal auditor are expected.
A few criminal and administrative cases against NABU director Artem Sytnyk are open, giving the Prosecutor General’s Office and the Agency for Corruption Prevention key leverage of pressure over Sytnyk. Meanwhile, the same agency insists that NABU shall not investigate any case of illicit enrichment and fraud in e-declarations unless it confirms the existence of evidence of crimes.
In addition, political elites come up with new tools of attack, bold-faced and harsh. Disruption of the undercover operation at the State Migration Service by prosecutors and the Security Service of Ukraine’s leaking personal data of NABU secret agents are among them.
Therefore, in 2018 it is critically important that civil society, reformers in government and parliament, as well as international partners harshly respond to any further attempt to weaken NABU. Exclusive jurisdiction of NABU overall top corruption cases should be secured. No new political grounds should become pretexts for NABU Director dismissal. In addition, negative opinion of the audit should also be removed from the list of grounds for dismissal.
Independent anti-corruption court
After Ukraine lost so much precious time in 2016 and 2017 with all the discussions over whether Ukraine needs an anti-corruption court or chambers – or nothing at all, the Venice Commission in its opinion seemed to dot all i’s and cross all t’s. However, a long-awaited president’s draft law on anti-corruption court No. 7440 neglects key recommendations from the commission.
Apart from the establishment of the separate court and an independent appeal instance as its part, the rest of provisions were ignored. Thus, nominees of international donors are given an advisory role, instead of a crucial one, in the selection of judges. Jurisdiction of the court does not fully cover cases investigated by NABU (including money laundering and declaring false information) and, on the contrary – covers cases not related to top corruption (officials’ drug dealing and arms trafficking). Moreover, the draft law establishes unrealistic eligibility requirements for candidates for positions of anti-corruption judges, under which it may be impossible to operationalize the court in next few years.
Should the draft law be adopted in this form, Ukraine will end up with a fake institution having little difference with the existing distrusted courts, whose judges are vulnerable to external pressure. There is a chance that the draft law will be improved before the second reading in the parliament. To the contrary, it may get worse. The only way to move forward is for President Petro Poroshenko to withdraw promptly this draft law and submit a new one that takes into account the Venice Commission’s recommendations. This is still possible before the draft law is included in the Rada’s agenda.
In early 2018, parliament has to adopt the draft law on anti-corruption court with Venice Commission recommendations on board. The court should be established this year and start working.
Real verification of e-declarations
With only 100 of more than 1.3 million e-declarations verified, nobody doubted something went wrong. Brave whistleblowing by an official of the Agency for Corruption Prevention once again put a finger on the problem. The official, Hanna Solomatina, who boldly spoke about the abuse of power in the agency, reported that the e-declarations system was misused for political persecution, that verifications were controlled by the Presidential Administration and that agency management deliberately stalled the reform.
E-declarations were launched in 2016 only due to the pressure of the European Union, the IMF and civil society, supported by only a few reformers in power. Stopping halfway with this reform will cause a lot of damage. The fairytale assets of officials were revealed, but nobody was brought to justice for illicit enrichment. However, even the third 600 million euros tranche of EU financial assistance, linked to launching an automatic verification system, was not enough incentive for authorities to pursue the reform.
The current composition of the agency completely screwed up the reform. In order to get e-declarations back on track, the agency should be rebooted via transparent selection process, as well as its competition panel should be changed. Collective irresponsibility led to absolute ineffectiveness, so it is also important to change the management structure of the agency in favor of one-person leadership.
As a temporary measure, pending renewal of the agency renewal and in order to ensure that NABU has independent capacity to initiate cases involving electronic asset declarations, it is necessary to transfer powers to verify declarations of top officials to NABU.
In addition, it is critically important to finally cancel such e-declaration obligations for anti-corruption activists, as well as subcontractors and service providers of anti-corruption nongovernmental organizations to submit e-declarations.
Conclusion
These steps do not comprise an exhaustive list of the anti-corruption measures that Ukraine should implement in 2018.
Other important steps in fighting against corruption would be depriving the Security Service of Ukraine of powers to investigate corruption-related and economic crimes as recommended by NATO, and ensuring transparent selection of the State Bureau of Investigations detectives.
To prevent further rollbacks, the West should finally start considering the introduction of assets freeze against top oligarchs and corrupt officials who block Ukrainian reforms.
Knowing that the environment will become more hostile towards reforms, it is important that all stakeholders pull their efforts together and stay synchronized. Ukraine has achieved indeed a lot – now it is high time to protect accomplishments and keep moving forward in the right direction.
Olena Halushka is the manager of international relations with the Anti-Corruption Action Center in Kyiv.
