On Article 364 of the Criminal Code of Ukraine — a Frankenstein

Recent proposals to amend Article 364 of the Criminal Code of Ukraine (hereinafter referred to as the CCU), which covers abuse of authority or office, have caused a new round of discussions in the professional community, for example, regarding the motive of the official to commit abuse, as well as the content of the consequences that the defendants may be incriminated in these cases. It even forced lawyers to look into criminal law textbooks and academic papers. 

We are talking about those cases where officials are accused of actions that are contrary to the interests of the official duties, but committed for personal benefit or for the benefit of another person, and which caused some damage to either the state or private interests.

So let’s try to look at this discussion with detachment.

Criminal liability should be based on an unambiguous law

The criminal law must be of high quality so that people can distinguish criminal acts from non-criminal ones. This is checked, for example, by the European Court of Human Rights (hereinafter referred to as the ECHR) when considering complaints under Article 7 of the Convention for the Protection of Human Rights and Fundamental Freedoms. It is in this article that the rule is formalized that no one can be punished without the law.

The ECHR has consistently reiterated that the law cannot be absolutely certain because there are situations that require flexibility in interpretation. An example of such situations may be a relatively new form of providing an unlawful benefit — cryptocurrency. After all, when adopting the CCU, the legislator could not foresee that such a phenomenon would appear at all. 

The analysis of the ECHR practice allows us to argue that, balancing between accuracy and flexibility, we should turn to the subjective and objective aspects of the certainty of the law.

Assessing the subjective aspect, it is necessary to consider the provisions of the law from the perspective of the prosecuted person. For example, if this is an official, then they should know all the nuances of the legal regulation of their work, they can contact legal advisors on how to act in a particular situation. They will have to be especially careful and prudent when operating in “gray areas.”

The objective aspect refers to how a certain article of the CCU is written and how it is usually applied, whether it uses evaluative concepts, whether the legislator made a mistake in constructing sentences or using words. Moreover, a sign of a correct interpretation of the wording of the text is a more unambiguous practice of the courts to prosecute under this article.

An example of this aspect is the incrimination of Article 364 of the CCU to MPs who illegally received compensation for renting housing. Earlier, in a special review, we found that there was no agreement among the HACC judges on the key points of the prosecution in such cases. This could be due to the fact that the practice of such cases in the NABU and the SAPO was new at that time. 

Predictably, considering the cassation appeal of ex-MP Ruslan Solvar, who was convicted by the HACC Appeals Chamber under Article 364 of the CCU, the Supreme Court decided to refer the criminal proceedings to the joint chamber. The judges stated that there were different approaches as to which actions covered official abuse. 

Assessing Article 364 of the CCU, we can say that it primarily concerns highly specialized persons who, given their position, must know the nuances of legal regulation of their own actions, that is, the increased complexity of legislative provisions is allowed. However, the above cases of the application of this article in various criminal proceedings suggest that not all of its provisions are unambiguously clear.

Abuse of office is a “conventional” crime, but it is necessary to overcome the negative historical tendency in law enforcement

Unfortunately, we inherited certain approaches to understanding abuse of office from Soviet criminal law. In one of the textbooks of 1937, as an example, a situation is described when the head of the collective farm sent a knowingly inaccurate report that his company had fulfilled the sowing plan. The authors of the textbook point out that in the case when it is really inaccurate, such a situation causes or can cause serious consequences, as it creates a misconception about the work of the collective farm. Therefore, such actions are an abuse of authority.

Such, to put it mildly, a peculiar approach to the interpretation of the provisions of the criminal law distorts the essence of the criminalization of abuse of authority as a means of countering corruption.

Article 19 of the UN Convention against Corruption defines the right of the state to criminalize the intentional abuse of office or official position. This refers to the action or inaction of a public official in violation of the law during the performance of his/her functions. It is important that these actions be committed in order to obtain any unlawful benefit for themselves or another individual or legal entity.

The explanatory note to Article 19 states that such abuse of authority “may encompass various types of conduct, such as improper disclosure by a public official of classified or privileged information.” 

This allows us to answer several questions of the recent JustTalk discussion about Article 364 of the CCU: personal motive and causing real damage are not elements of abuse of office under the Convention. In addition, the authors of the study on the state of implementation of the Convention provisions note that establishing the consequences of official abuse as a mandatory element of the crime is a significant deviation.

The study of historical experience and international commitments of Ukraine allows us to draw such conclusions:

1) a broad interpretation of Article 364 of the CCU may lead to abuse by law enforcement agencies in the course of bringing persons to criminal liability;

2) international acts do not require establishing any consequences of official abuse, but specify that a violation of the law is punishable, and not the commission of actions “contrary to the interests of the official duties.”

The current version of Article 364 of the CCU has many more safeguards against its broad interpretation to the detriment of the person, in contrast to its primary Soviet counterpart. Although, this does not always prevent from arbitrary interpretation of the law by law enforcement agencies and courts.

There are more or less radical ways to overcome the shortcomings of criminal legislation 

The first is amending the legislation, and the second is judicial practice. Legislation should be amended in exceptional cases when judicial interpretation cannot overcome such shortcomings. 

However, some MPs decided to approach the problem of Article 364 of the CCU radically. Thus, Hryhorii Mamka, MP from the currently banned pro-Russian party Opposition Platform — For Life, proposed that the subject of official abuse should have a personal interest in such abuse, and the consequences of actions of this subject should be only in the form of real material damage. This is what caused a wave of criticism among individual CSOs, which some lawyers tried to restrain.  

First of all, before amending something, it is necessary to find out whether it should be changed at all and whether such changes will not be harmful. This can be done through criminological examinations, which are referred to not only in the works of academics, but also in the Comprehensive Strategic Plan for the Reform of Law Enforcement Agencies as Part of the Security and Defense Sector of Ukraine for 2023-2027, which has been recently approved by the President of Ukraine. 

Hryhorii Mamka’s amendments do not add clarity. He does not propose to determine the content of the collocation “real material damage,” nor does he specify “personal interest” of the subject of this crime. These changes are unsystematic, besides, they are introduced only in Article 364 of the CCU, but the liability for abuse of the special status is established by a set of articles of this Code. If you change one of them, there may be questions about the correctness of the interpretation of others.  

Therefore, we can only positively assess the decision to decline them.  

Problems in the application of Article 364 of the CCU are caused by such unreasonable and isolated changes. 

For example, previously, abuse of office was criminally punishable if it caused both material and non-material damage. However, in 2014, the notes to Article 364 of the CCU were changed under the pretext of the implementation of the Action Plan on Visa Liberalization for Ukraine. The “if” was removed from the notes to Article 364 of the CCU, and this caused uncertainty and discussion about the content of the concepts of “substantial damage” and “grave consequences.” To some extent, they were interpreted by the Supreme Court of Ukraine in its ruling. 

Interestingly, we failed to find real requirements that would put the EU-Ukraine Action Plan on Visa Liberalization to the disposition of Article 364 of the CCU. 

In general, MPs are rather inconsistent in amending Article 364 of the CCU. After all, only in May 2020, the “presidential” draft law No. 2621 was adopted as a basis, by which this article returned to its “wide scope of consequences.” 

Thus, Article 364 of the CCU constantly undergoes unreasonable, isolated changes that have a significant impact on law enforcement. It seems that quite often when they are adopted, MPs pursue personal motives.  

In addition, the Parliament’s practice of criminalizing or decriminalizing certain acts without proper criminological research is inappropriate. The research should help find out that, for example, there are no high-quality criminal proceedings, which established the presence of the content of Article 364 with consequences that do not consist in real material losses; therefore, it is necessary to amend this article.  

All this, in our opinion, does not allow to legally limit the form of damages for abuse of special status. Therefore, we should turn to another method — judicial practice. 

Judicial practice can set the record straight in the issues of applying Article 364 of the CCU. 

The Law of Ukraine On the Judiciary and the Status of Judges stipulates that all courts must summarize judicial practice. The summarization of the Supreme Court is the most valuable. Unfortunately, for the entire time of its operation, the Supreme Court, in its updated composition, has not published such summarization on criminal law issues. However, the secretariat systematically publishes qualitative reviews of the judicial practice of cassation courts. 

What is the problem of proving the consequences in Article 364 of the CCU? Let us try to explain. 

It seems that the nature of the discussion about this article is criminal and procedural and does not directly relate to issues of substantive criminal law, and even the stumbling block lies not so much in the possibility of incriminating a person for causing material damage in the form of lost profits, but in proving the high standard (beyond reasonable doubt) of the amount of these damages. 

After all, the arguments of opponents of qualifying lost profits as consequences under Article 364 of the CCU are limited to the impossibility to prove for certain the amount of losses as a result of lost profits, since the size of the latter depends on many factors. 

In our opinion, this discussion should consider, in particular, the following arguments:

• The state should punish officials for deliberate abuse when they caused damage to business or the state, which consists in lost income. For example, the investigator, in complicity with the judge, illegally seized the assets of the business; as a result, the latter stopped its activities and suffered losses.
• Liability for the profit not received by the enterprise, institution, organization can be assigned only to employees who are officials in accordance with Article 130, part 4 of the Labor Code of Ukraine.
• If the act of an official was aimed at positive consequences for the enterprise, then this cannot be considered a criminal offense if it was committed in conditions of a justified risk to achieve a significant socially useful goal (Article 42 of the CCU).

The quality of evidence of substantial harm or grave consequences from abuse of office or abuse of authority is important. We can simulate situations where the lost income is proved evidently, for example, contracts were signed under which the funds for the supply of goods were to be paid, but due to the actions of the manager, the contracts were not fulfilled. 

However, there are more complex cases where it is necessary to consider a number of additional conditions that reduce the likelihood of generating income, for example, the changing situation regarding interest in objects of lease that are rented out under a competition. Then, we should not talk about criminal liability.

So, what can be done?

It is necessary to assess the quality of the Criminal Code carefully because not all of its articles can be absolutely clear to everyone. We should consider both subjective and objective aspects of the certainty of the Criminal Code of Ukraine. 

Abuse of office is not something new for Ukraine and the world, but national law enforcement is “burdened” by the Soviet approach of a broad interpretation of criminal law. 

The negative phenomenon of amending the Criminal Code without conducting a criminological examination and its extensive discussion with the professional environment and studying the consequences for existing criminal proceedings is common for Ukrainian lawmaking. 

The issued of applying Article 364 of the Criminal Code of Ukraine can be solved by summarizing judicial practice at the level of the Supreme Court. The question of the possibility of incriminating lost profits lies in the plane of proof, and not in substantive criminal law. Therefore, it should be solved through the engagement of experts in the field of forensic economic examination in the discussion. 

This publication was prepared with the financial support of the European Union. Its content is the sole responsibility of Transparency International Ukraine and does not necessarily reflect the views of the European Union.