Seeking to declare the activity of the Asset Recovery and Management Agency unconstitutional in August 2018 56 MPs appealed to the Constitutional Court.

Taking into consideration that some of those 56 MPs, including Dubnevych, Rosenblatt and Sviatash, may have violated the requirements of the Law of Ukraine “On Corruption Prevention” regarding conflict of interest, Transparency International Ukraine appealed to the NACP at the end of September.

Some MPs had personal interests in blocking the ARMA’s work because their property was already in the management of the Agency or could be there in the near future. In particular, two seized thermal power plants are owned by the Dubnevych brothers, who may be guilty of inflicting the national budget UAH 1.5 billion of losses.

The National Agency for Corruption Prevention didn’t function properly. The organization got neither an adequate answer nor the results of the audit. If the Constitutional Court had not denied the MPs, the ARMA’s performance in the Ukrainian reality could have failed. Without the management function, the Agency cannot fulfill its primary function—to preserve the economic value of the seized and transferred assets.

What is conflict of interest and why should it be resolved?

It is a contradiction between private interest and powers of office, which may affect the objectivity or impartiality while executing these powers. Conflict of interest is one of the main sources of the feeling of injustice. Unregulated conflict of interest breeds corruption and provokes criminal offenses.

What is our legislation lacking and what do we have right now?

Ukrainian legislation is moving closer to international standards, but there is still a lack of proper implementation. The problems occur due to the imperfection of the legal regulation, the administrative legislation failures, the absence of the NACP territorial subdivisions and the lack of an electronic automated system of management of the NACP’s affairs. Moreover, in fact, we do not have any common practice on punishment for conflict of interest and even existing practices are different in various institutions.

In 2018, the Center of Policy and Legal Reform reviewed the NACP’s practice of resolving and punishing conflicts of interest. In 24% of the total number of cases a total of 61 persons were found guilty of violating the conflict of interest requirements. 26% of these cases returned to the NACP because of not having been formalized properly.

Almost half of all cases were closed due to a lack of crime evidence or an expiry of time-limit.

What can be done?

Before the New Year the first permanent NACP head will take his post of office. Since the beginning of November, there is a competition to fill this post and by that time the commission has to select a worthy candidate.

The launch of an open online system for reporting real or potential conflicts of interest including the introduction of separate procedures for resolving these different types of conflicts is one of the main tasks of the new head.

In addition, a proper assessment of corruption risks in the NACP is to be conducted, that means to find out the cause of Agency low work efficiency.

Perhaps, introducing the notion of a perceived conflict of interest also should be taken into consideration. When it just seems to be a conflict of interest, but it isn’t, for example, some local council members solving local problems are guided by community interests, but the bystander has the misconception thinking that it is all about private interest. Such perceived conflicts of interest also need to be resolved because they affect the trust in officials.

Corruption cannot be overcome without prevention

In some EU countries, there is a so-called “cooling off period”. After the layoff former officials are prohibited to conclude agreements with a former employer during a year.

In addition, you can define a period during which an MP or a public servant cannot make a decision in favor of the one who gave him or her a gift. It can be 2-3 years.

Transparency International Ukraine also recommends to detail counterpart earnings so that NACP and the public can immediately see a breakdown of the declarant’s sources of income. This will facilitate the monitoring of conflicts of interest through the public register of declarations.

Probably, the concept of a “minor conflict of interest” should to be introduced, according to which a public servant may be permitted to continue to perform his duties despite being caught up in the permanent conflict of interest.

The MPs Code

A clear code of conduct for MPs should partially change the issue of conflict of interest. This document should contain practical and detailed recommendations for the prevention of conflicts of interest and allow for recourse in some specific situations.

However, in order for such code to work MPs themselves must formulate and then adopt it. Participation in the process should hold them accountable for the result.

Not Just Legislation

With the support of UNDP, the NACP has launched online courses on the conflict of interest for officials on MOOC service Prometheus. However, this is not enough. After all, officials at all levels need education and information coaching. We need to nurture their intolerance to corruption and give them an alternative – to work transparently and effectively. Ultimately, effective resolution of a conflict of interest is the shared task and responsibility of officials, the state represented by the NACP and the conscious public.