Introduction

In January 2026, the NACP published the draft Anti-Corruption Strategy for 2026–2030 (hereinafter — the AS, or the Strategy), which the Agency submitted for approval to stakeholder bodies. The new strategic document contains three chapters, rather than the four found in the current Strategy. 

In this iteration, Chapter I covers the general system of corruption prevention and counteraction, while Chapter II addresses corruption prevention in priority sectors. Also, a new final chapter has been introduced, dealing with the regulation of key procedural aspects of implementation, reporting, monitoring, coordination, and effectiveness assessment of the Anti-Corruption Strategy and the State Anti-Corruption Program (SAP) for 2026–2030. This chapter was added after the round of public discussions had concluded and was presented only in the finalized draft, meaning that civil society organizations had no opportunity to comment on it. 

It is also worth noting that, in drafting the new Anti-Corruption Strategy, the NACP engaged external expert groups — an approach that is positive in terms of inclusivity and the overall quality of individual sections. This was likely a contributing factor to the insufficient uniformity across sections, particularly in terms of the level of detail provided. 

TI Ukraine was involved both in drafting certain sections and in discussions of drafts already published by the NACP. In particular, our experts worked directly on the public procurement section, and the analysis below reflects this.

With respect to sections 1.1, 1.3, 1.4, 1.5, 1.6, 1.7, 1.9, and 1.10 of Chapter I, and sections 2.1.1, 2.1.2, 2.3.2, and 2.5 of Chapter II of the Strategy, TI Ukraine’s experts participated in public discussions of these parts and submitted written comments to the NACP.

It is also important to note that NACP published the relevant supporting materials for all sections, as well as tables indicating whether comments were accepted or rejected. This is a good practice that the Agency applied when preparing the previous Strategy as well. 

We now turn to the sections reviewed by TI Ukraine. 

State Anti-Corruption Policy

Section 1.1, on state anti-corruption policy, addresses the regulation of the preparation and implementation of the AS and SAP for future periods. Compared to the anti-corruption policy section of the current Strategy, the new draft covers a narrower set of problems and strategic results, drawing directly on the experience of preparing and implementing the current anti-corruption policy cycle.

The section’s focus on the development and implementation of the anti-corruption policy cycle is entirely justified. The previous Anti-Corruption Strategy was the first document of its kind and contained, in its anti-corruption policy chapter, broadly framed problems and declaratory expected results — such as a reduction in the general level of public tolerance for corruption in Ukraine. The corresponding section of the new draft AS is free of such superfluous provisions.

That said, the draft has its weaknesses. Section 1.1 frequently proposes that the NACP and other responsible bodies carry out a range of activities that these institutions already perform on a regular basis. Despite this, our comment — that the Strategy should not duplicate activities already required by law — was not accepted. The Agency explained that the Strategy must be aligned with existing legislation to ensure proper implementation by the relevant bodies, and that the document should contain all possible measures for addressing the problems it identifies. This rationale is difficult to accept, since the AS is itself adopted at the level of a law, and its provisions are equally binding as those of sector-specific legislation. There is therefore no need for duplication. 

On the positive side, the NACP accepted our proposal to introduce a “strategic pause” between the end of the 2026–2030 Strategy and SAP and the preparation of the next anti-corruption policy cycle. The Agency also agreed on the need to introduce incentive mechanisms for SAP implementers and to grant the NACP the right to issue binding instructions — both of which should significantly improve the implementation discipline of government bodies.

However, our comment proposing that an acceptable rate of SAP implementation be set at 90% of completed measures — with the remaining 10% either having justifiably lost relevance or being unimplemented for financial reasons — was not reflected in the final draft. This threshold corresponds to OECD requirements. The question of implementation rates is not addressed at all in the current draft AS.

Some of our comments aimed at improving the coordination of AS and SAP implementation were accepted, which is also a positive development. For example, the final draft provides for the possibility of including representatives of the business community, academic community, non-governmental organizations, international technical assistance projects, and international organizations in the Coordination Working Group on Anti-Corruption Policy.

Corruption risk analysis and conflicts of interest

Sections 1.3 through 1.5 of the Strategy — covering anti-corruption programs, authorized units and officers, corruption risk analysis, and conflict of interest monitoring — broadly address most of the relevant issues in these areas. Sections 1.3 and 1.4 attracted fewer critical comments from us than the conflict of interest section, which is also one of the most detailed in Chapter I of the AS. 

The NACP accepted our proposal to review approaches to the remuneration of authorized officers in light of the complexity of their functions, as well as the proposal to explicitly designate the failure to incorporate the results of a previous anti-corruption program as grounds for the NACP to reject a new program.

However, although the section addresses the strengthening of the institutional independence of authorized officers, TI Ukraine’s comments regarding sanctions for the absence of authorized units or officers, as well as for the absence of anti-corruption programs, were not reflected in the Strategy’s expected results. The Agency explained that heads of organizations should themselves be motivated to maintain effective internal anti-corruption policies, and that sanctions would therefore not be effective. 

In our opinion, the existence of sanctions for failing to adopt an anti-corruption program or for not having an authorized anti-corruption officer would nonetheless serve as an additional incentive to comply with legal requirements, since sanctions are designed precisely to motivate those who would not act on their own initiative.

The NACP also did not provide for a more systematic involvement of civil society expert organizations in corruption risk assessments and the preparation of anti-corruption programs.

With respect to the quality of NACP’s and the Ministry of Justice’s anti-corruption assessments, the comment-response table indicates that the Agency intends to implement some of TI Ukraine’s comments at the SAP development stage. However, NACP’s intention to reconsider its discretion in selecting draft regulatory acts for expert review was not clearly reflected. The Agency may yet revise its position during the SAP development stage and incorporate this measure into that document.

On the conflict of interest section, the NACP still has not addressed the most critical comment — namely, that the Agency does not yet apply automated assignment of monitoring cases among its authorized officers, despite this approach having been criticized in the external independent assessment report of NACP’s performance for 2020–2021. The Agency explained that introducing automated assignment for proactive monitoring would artificially limit NACP’s ability to respond independently and swiftly to information appearing in the public domain and would significantly reduce the effectiveness of the proactive oversight mechanism. 

We cannot agree that the effectiveness of monitoring is contingent on the absence of automated assignment. Full declaration reviews can also be triggered by notifications from individuals and legal entities or information from media — and this does not prevent automated assignment from being applied in far more complex verification procedures. 

Moreover, the logic of prioritizing oversight effectiveness over oversight transparency is simply untenable in the context of NACP’s anti-corruption work.

Likewise, despite TI Ukraine’s comment, the NACP retained provision 1.5.3.2, which introduces exceptions to the general prohibition on officials receiving gifts in cases of “difficult life circumstances” (medical treatment, damaged housing). In our view, this creates identifiable risks of abuse. Issues of financial support for officials should instead be resolved through improvements to the social protection system for such persons or through the creation of charitable public fundraising mechanisms.

The NACP also declined to accept TI Ukraine’s position that the introduction of the concept of “perceived conflict of interest” into legislation would be premature, given that problems persist with the interpretation of existing terms. Specifically, despite the definitions of real and potential conflicts of interest established by law, courts have still been unable to develop consistent case law in matters involving violations in this area.

The remaining provisions of the conflict-of-interest section — regarding restrictions related to gifts, corporate ownership, and the combination or concurrent holding of official positions — were, in our opinion, developed to a high standard. The section successfully addresses the issue of disproportionate requirements concerning the mandatory transfer of corporate rights, the need to revisit the prohibition on receiving gifts, and the insufficient regulatory clarity surrounding the rules on combining and concurrently holding positions.

Financial control

Section 1.6 on financial control captures the problem of incomplete coverage of declaration subjects (staff of patronage services, members of local council executive committees, etc.), the excessive burden of completing declarations, ineffective oversight of timely declaration submission, and the insufficient effectiveness of the financial control mechanism as a whole. All of these issues are important for strengthening this mechanism and are consistent with the European Commission’s requirements.

Despite this, Section 1.6 attracted our sharpest criticism. While the NACP does acknowledge the insufficient effectiveness of financial disclosure, it attributes this primarily to inadequate automation and interoperability of registries, as well as legislative shortcomings — whereas civil society and international experts have consistently argued that it is the Agency itself that has built a financial disclosure system that fails to deliver results.

For example, the EU’s latest Enlargement Report on Ukraine calls for a stronger e-declaration system to genuinely and effectively prevent and detect unexplained assets. The Commission stated that the system has practical and legal shortcomings, primarily relating to the automated verification process.

What the NACP needs is not more automation of verifications, but a focus on enhancing the capacity of its authorized officers to conduct full verifications — only a human investigator can carry out a quality investigation of circumstances that appear suspicious. TI Ukraine has on numerous occasions provided the NACP with detailed recommendations for overhauling the financial disclosure system. 

Despite significant resources invested in developing and operating the electronic asset declaration registries, the financial control tools are mostly used to hold officials accountable for fairly minor instances of concealment or inaccurate declarations. Rarely does an e-declaration review escalate into a serious top-level corruption investigation.

Among our proposals, we suggested that the section include a problem statement to the effect that the existing financial disclosure mechanisms at the NACP are ineffective due to the Agency’s limited resources, their suboptimal use, the existence of duplicative functions, and other underperforming elements of the system. Addressing this problem would require a series of legislative amendments, updates to internal regulations, and changes to NACP’s implementation practices. 

The NACP did not agree with our proposals and even signaled an intention to enshrine in law the automation of verifications as a substitute for manual full-review procedures.

Among the comments that were accepted: the abolition of the obligation to submit certain interim disclosures already covered by the annual declaration, and the extension of oversight to officials of state-owned enterprises (with a shareholding above 50%) and members of executive committees.

With this approach — ignoring genuinely important problems in the corruption prevention system in the new AS — we will continue to fail to see any real effect from the Agency’s work for a long time to come, and will instead witness, once again, corruption scandals that could not be prevented. 

Whistleblower protection

The whistleblower protection section attracted almost no critical comments from us. The NACP developed it to a high standard, with an appropriate level of detail for a document of the Anti-Corruption Strategy’s standing. 

This section covers both the need to bring legislation and practice on whistleblower protection into conformity with European standards, and the need to improve the operation of the Unified Whistleblower Reporting Portal and the responsible bodies, as well as to foster a culture of whistleblowing.

To achieve these objectives, the Strategy proposes a set of interrelated measures: bringing national legislation into line with EU Directive 2019/1937 and harmonizing the definition of “whistleblower”; establishing an institutional framework with a designated coordinating body and a network of responsible units within public and private organizations; promoting a culture of whistleblowing and raising employees’ awareness of their rights; modernizing the Unified Whistleblower Reporting Portal through integration with state systems and the introduction of a mobile application; and other critically important steps to improve how the whistleblower institution functions.

The only substantive proposal from TI Ukraine was to clarify the relationship between the statuses of “whistleblower” and “confidential informant” so as to avoid legal confusion. However, given its specific nature, this point is likely to be addressed at the SAP stage.

Comments from another expert organization were also well-taken concerning the absence of adequate tracking of complaints about violations of whistleblowers’ rights and the low number of cases in which rights are actually restored. The number of whistleblowers effectively protected is the real measure of the Agency’s performance in this area, so it is important to keep the focus here. The NACP did not fully incorporate these comments but did take them into account. We hope these observations will be reflected, if not in the final text of the AS, then in the SAP. 

Anti-corruption segment of criminal justice

Sections 1.9 (“Counteracting corruption and corruption-related offenses”) and 1.10 (“Independence, institutional resilience and effectiveness of anti-corruption institutions”) of the draft Anti-Corruption Strategy cover the system of legal liability for corruption and the capacity of anti-corruption bodies to enforce it. Section 1.9 systematically covers the types of liability — from disciplinary measures through civil law instruments to criminal liability. Section 1.10 is structured around four anti-corruption institutions: NACP, NABU, SAPO, and HACC.

Overall, the draft AS in this part demonstrates a high degree of alignment with the European Commission’s technical recommendations: it includes autonomous wiretapping powers for NABU, expanded authority for the SAPO Director, measures to counter the abuse of procedural rights in HACC, and strengthened internal oversight within NABU. The recommendation on the statistical data system (1.9.4.3) was fully incorporated, while the “fugitives” issue (1.9.4.4) was addressed partially.

That said, the draft Strategy provides for granting NACP the right to independently file civil confiscation claims (Result 1.9.2.2). During public discussions, we recommended against this, citing the Agency’s already heavy workload and the advisability of limiting the measure to granting NACP procedural powers to collect evidence following amendments to Article 290 of the Civil Procedure Code of Ukraine. Instead, the NACP would be better served by gaining the ability to independently represent its own protocols in court, rather than relying on prosecutors — a measure already envisaged in the State Anti-Corruption Program for 2023–2025 but not yet implemented.

The draft’s wording also fails to cover the scenario of filing a civil confiscation claim following an acquittal, addressing only cases where proceedings have been closed. This creates a legal gap, since an acquittal and the closure of proceedings are distinct procedural institutions. In the absence of a clear provision allowing for civil confiscation following an acquittal, the state risks losing this tool in cases where individuals are acquitted due to evidentiary shortcomings and the higher standard of proof in criminal proceedings compared to civil ones. The problem of SAPO prosecutors lacking the right to obtain restricted-access information for the purpose of building an evidence base in unjustified assets cases also goes unaddressed.

TI Ukraine proposed conditioning the referral of cases based on NACP protocols to the HACC on a prior strengthening of the court’s capacity, citing the court’s heavy caseload and shortage of judges. The draft retains provision 1.9.3.3 on the adjudication of cases by HACC without any such caveat, although Section 1.10.4 provides for measures to improve the court’s efficiency. The logical connection between these provisions is not apparent, and the temporal sequencing of their implementation is not defined.

We emphasized the need to specify the provisions on special confiscation and statutes of limitations in the Criminal Code of Ukraine (modifying the point at which the limitation period begins and expanding the grounds for suspension). The draft operates with general language about bringing legislation into conformity with EU and OECD standards, which could theoretically encompass these issues.

The most problematic gap is the absence of any provision on abolishing the automatic closure of cases upon the expiry of pre-trial investigation deadlines. This is one of the most acute problems in practice and is already included on the list of priority reforms on Ukraine’s EU accession path and in the Rule of Law Roadmap — yet the anti-corruption strategy, as the highest-level anti-corruption policy document, makes no mention of it.

Compared to the previous Anti-Corruption Strategy, the draft contains no provisions on the effectiveness of anti-money laundering efforts. This is a cause for concern given the circumstances of the Midas case, which point to insufficient financial monitoring effectiveness, and the European Commission’s warning that the freezing and confiscation of criminal assets remain very limited in scope.

However, in the section on the judicial system and the status of judges, our proposal was accepted: selection to the High Qualifications Commission of Judges and the High Council of Justice should continue to be based on an improved selection process with the participation of independent experts nominated by international partners and holding a decisive vote. And in the section on the prosecution service, public order, and countering criminal offenses, a positive development is the proposal to establish robust procedures for the appointment and dismissal of the Prosecutor General to mitigate risks of informal or political influence, as well as to reinstate competitive selection for positions of prosecutors in the Prosecutor General’s Office and regional prosecution offices, in line with European Commission recommendations.

At the same time, it is critically important that ambitious strategic outcomes do not remain merely declaratory. The experience of the previous Strategy shows that even progressive provisions can be nullified by a lack of political will. The Strategy could also have established mechanisms to protect the independence of anti-corruption bodies from harmful legislative initiatives, as occurred in the summer of 2025 with the law that sought to curtail the independence of the NABU and the SAPO.

Recovery

Recovery has for the first time been designated as a standalone chapter of the draft AS, as one of the priority areas of state policy. Given its cross-cutting nature, some of the related problems are also reflected in the chapters on construction and public procurement. The dedicated recovery chapter focuses on strategic planning, regulatory framework, and the selection of recovery projects.

The absence of a comprehensive state recovery strategy is the first problem the Strategy aims to address. Despite the existence of individual planning documents at the local and regional levels, no holistic state-level strategy for eliminating the consequences of the armed aggression and for post-war recovery has been approved, notwithstanding the regulatory prerequisites for one and prior attempts to develop such a document.

The existence of a document that would conceptually define the nature, objectives, and priorities of recovery — and provide for mechanisms of coordination, monitoring, and accountability — is a critically necessary precondition for effective planning, adequate financing, and the implementation of recovery projects. At the same time, approving a comprehensive and actionable recovery strategy will be no simple task, for several reasons.

Recovery is a complex area that intersects with many areas of state policy. Certain aspects of recovery have already been addressed in a range of sector-specific policies and strategic documents. Under these conditions, formulating a coherent recovery strategy requires careful alignment of its key provisions with a broad range of stakeholders and proper coordination among different priorities.

Moreover, there is no shared understanding of the very concept of “recovery” — its scope, priorities, and components. For some, it means returning to the pre-war state; for others, modernization and “building back better”; for others still, a mixed model dependent on sector and territory. The Strategy risks being either too general or failing to secure the support of key stakeholders.

Second, the data on which the strategy would need to be based (the scale of destruction, losses, needs, and their prioritization) is constantly changing. Furthermore, management decisions in the recovery sphere are not always grounded in complete, reliable, and systematized data. Under these conditions, it is difficult to enshrine in a strategic document objectives and priorities that will not have lost their relevance by the time of implementation. The draft AS rightly identifies this as a distinct critical challenge requiring resolution.

Third, in wartime conditions, the logic of recovery is largely subordinated to the priority of rapid response in specific areas or sectors, which complicates the alignment of such decisions with long-term planning.

Among the other problems identified in the draft Strategy’s recovery section, it is worth noting the government’s active use of pilot projects as an alternative to applying the provisions of permanent legislation. This mechanism effectively allows for departures from general permitting procedures, funding rules, and oversight mechanisms.

Since the start of the full-scale war, the use of pilot projects has taken on a systemic character — driven, on the one hand, by the need for swift decision-making, and giving rise, on the other hand, to risks of legislative fragmentation, reduced procedural predictability, weakened transparency and accountability, and inefficient use of public funds.

TI Ukraine previously researched the pilot project on the comprehensive recovery of settlements affected by Russian aggression. The findings showed that, due to gaps in the conditions governing the experiment, the reconstruction of one of the planned settlements was effectively dropped from the program. Moreover, over two years of implementation, only approximately 8% of the planned number of facilities had been restored.

The draft Anti-Corruption Strategy proposes to regulate the mechanism for launching government pilot projects, by providing for a clear definition of their legal nature, a mandatory justification for departures from standard procedures, the publication of information on their implementation and results, and the exercise of state financial oversight with respect to such projects. The proposed approach would create the preconditions for a more transparent and clearly defined use of pilot projects and for reducing corruption risks in the recovery sphere. 

At the same time, the requirement to justify departures from standard procedures risks becoming a formality in the absence of clear criteria for the permissibility of such departures. Furthermore, failure to achieve the declared objective of a pilot project, or the absence of a substantiated report on its results, should be treated as grounds for its termination. These aspects should be taken into account in the preparation of the State Anti-Corruption Program.

The final two problems in the recovery — the absence of a single approved mechanism for prioritizing recovery projects, and the absence of a Unified Public Investment Project Management Information System — are closely interrelated.

The public investment management reform envisages the creation of a Unified Public Investment Project Management Information System (the Unified Information System), which is meant to be used for the prioritization and selection of public investment projects and programs — including those in the recovery sector — and to contain information on their implementation. However, the Unified Information System is not yet operational, and the formation of the Unified Project Portfolio for 2026 was carried out using the DREAM system, which only partially captures information on project implementation, readiness status, level of financing, and so forth.

Prioritization at the state level is currently applied to individual investment projects and investment programs, which may combine several such projects. However, legislation does not provide for a clear mechanism for prioritizing the projects included within investment programs. This gap creates risks of non-transparent selection, the inclusion of questionable projects in investment programs, and their subsequent entry into the Unified Project Portfolio.

The implementation of the measures set out in the draft Strategy will be of key importance for preventing non-transparent allocation of funds, duplication of financing, and their inefficient use. This includes ensuring the prioritization of all investment programs and projects — including those forming part of investment programs — as well as the introduction and proper functioning of the Unified Public Investment Project Management Information System, of which the DREAM system is an integral component. 

Public procurement

Last year, experts from the DOZORRO TI Ukraine project participated in drafting the Anti-Corruption Strategy’s public procurement section, conducting the necessary research and continuing to develop proposals for the corresponding expected results and measures. 

Based on the outcomes of a public expert survey, five problems were identified as the most significant in this area, the first of which is the abuse of the ability to modify essential terms of a procurement contract. Such practices occur both at the contract execution stage — when parties diverge from the draft contract published in the tender — and at the implementation stage. 

To minimize such abuses, we proposed the following: 

• defining a minimum list of procurement contract terms that are essential and may not be arbitrarily modified, taking into account how specific terms affect competition and the interests of the contracting parties,
• improving the legal regulation of the conditions for modifying procurement contracts, clarifying the rules governing price amendments, and expanding the volume of information published on contract modifications,
• developing the Prozorro system to a level that allows a procurement contract to be concluded automatically on the basis of its machine-readable draft form and introducing a full-text search function across contracts and supplementary agreements to facilitate oversight of their legality. 

The second problem the future Anti-Corruption Strategy will seek to address in the procurement sector is discriminatory and excessive requirements in procurement. This refers not only to overt discrimination in the classical sense, but also to excessive requirements that make procurement unattractive to participate in yet cannot be challenged — for example, excessively long payment terms and minimum timeframes for the submission of tender proposals. 

To improve the situation, we proposed introducing an appeal mechanism before the Antimonopoly Committee for purchases conducted through electronic catalogs; researching the factors that prevent businesses from challenging discriminatory conditions; defining requirements for permissible payment terms under procurement contracts; and extending the timeframes for the submission of tender proposals. It would also be appropriate to digitize procurement conditions and raise the professional level of contracting entities.

The third problem is the abuse of direct procurement, particularly under martial law. To address it, the list of grounds for conducting non-competitive above-threshold procurements needs to be revised and reduced, and the conditions and methods for conducting them optimized — including by reinstating the negotiated procedure where possible. In addition, it is important to regulate how the value of a procurement subject is determined when conducted directly, without a tender. 

The final two problems relate to proper oversight and accountability for intentional procurement violations. The procurement monitoring mechanism requires further development and improvement — in particular, a preventive and risk-based approach to monitoring is needed, primarily through pre-contract monitoring. It is equally important to ensure the effective implementation of the obligations identified in monitoring conclusions. A standardized list of remedial measures depending on the severity of violations, as well as an expedited court review procedure for monitoring conclusions, should help here. 

With respect to accountability for violations, the focus of proposals is primarily on ensuring that such accountability is inevitable. This requires updating the composition of administrative offenses and eliminating the factors that lead courts to frequently classify identified violations as minor or to dispute their existence altogether. 

The problems outlined may in some cases manifest not only as corrupt practices but also in situations where there is no corrupt intent. Nonetheless, each of them facilitates such practices or reduces the preventive effect on corruption in the work of contracting authorities.

Most of the expected strategic results will require legislative amendments, technical changes in the Prozorro system, and additional research. The adoption of Draft Law No. 11520 should facilitate the implementation of some of the steps outlined. 

The author team has traveled a long road of research and development of the Anti-Corruption Strategy draft, which began in January 2025 and continues to this day. We hope that, following the necessary approvals and revisions, the key ideas and intentions embedded in our proposals will be preserved. 

Conclusions

The draft new Anti-Corruption Strategy for 2026–2030 is fairly uneven in terms of both coverage of the necessary issues and NACP’s responsiveness to TI Ukraine’s comments. Certain sections of the Strategy are well prepared, reflecting both the positions of civil society and international partners, including the EU. However, on other matters our assessments were more critical and were not taken on board.

Among the key issues, we highlight the following.

1. Duplication of existing norms. Certain sections (for example, the section on state anti-corruption policy) repeat provisions of existing legislation without adding regulatory value. 
2. Insufficient specificity of certain strategic results. This applies, for example, to the protection of anti-corruption bodies’ independence from harmful legislative initiatives.
3. Failure to incorporate critical comments in the draft Strategy. The current version of the document leaves unaddressed the concerns regarding the ineffectiveness of the e-declaration verification mechanism, the absence of automated assignment of monitoring cases at the NACP, and the need to abolish the automatic closure of cases upon the expiry of pre-trial investigation deadlines. 
4. Incomplete coverage of problems identified but unresolved under the previous Strategy. The document contains no provisions on the effectiveness of anti-money laundering efforts, despite evident problems in this area. 

A recurring issue is the uneven level of detail across sections of the Strategy — a problem likely attributable to the involvement of different author groups without sufficiently rigorous editorial processing of the final document. This uneven structure creates the risk of uneven implementation of the Strategy in practice. 

We hope that some of these problems will still be addressed through the approval process with the relevant authorities — though the prospects for this currently appear uncertain.

Institutional and organizational matters

This category is anchored by the revised ARMA Regulation. The Law of June 18, 2025, introduced substantial clarifications regarding the Agency’s powers and organizational structure, and the Cabinet of Ministers brought the Regulation in line with the amended law accordingly.

The Regulation now expressly provides that ARMA disposes of assets under management through electronic auctions conducted on the state and municipal property privatization platform (Prozorro.Sale), in the manner and within the timelines established by the Cabinet of Ministers. It also provides that the Agency shall notify the prosecutor of the need to transition to asset disposal where, in the course of monitoring management effectiveness, circumstances are identified that preclude preservation of the asset’s economic value.

In connection with this last power, it is critically important that the corresponding prosecutorial authority be regulated — either through joint departmental instruments or through amendments to the Criminal Procedure Code — so that prosecutors can respond effectively to ARMA’s referrals on issues arising in the management of seized assets.

Amendments have also been made to the Regulation on ARMA authorized officers. Pursuant to the ARMA Law, authorized officers may now access assets transferred to ARMA for management, as well as seized assets in the identification stage, upon presentation of their official credentials — without restriction. This will enable the Agency to effectively exercise its authority to assess whether, and by what means, it can efficiently manage any given seized asset.

In addition, ARMA approved by internal order the Regulation on the Internal Control and Risk Assessment Department of ARMA’s Central Office and the Regulation on the Internal Security Department of ARMA’s Central Office. 

The Internal Control and Risk Assessment Department coordinates ARMA’s institutional oversight and risk management framework, conducts audits and investigations to identify violations in the area of asset tracing, preservation, and management, monitors the lawfulness of procurement and the use of budgetary funds, and prepares policy proposals on the detection, tracing, and management of seized and confiscated assets. The Internal Security Department is charged with safeguarding the integrity of ARMA personnel: it prevents corruption-related misconduct, conducts internal investigations, monitors compliance with ethical standards and conflict-of-interest rules, investigates reports of staff involvement in unlawful conduct, organizes pre-appointment vetting of candidates, and advises staff on ethics.

Accountability matters

The Regulation on the Public Oversight Council (POC) defines the status, mandate, and operating procedures of the Council as a standing collegial body exercising civil oversight at ARMA. The Council oversees ARMA’s activities, monitors the effectiveness of the Agency’s operations, reviews draft regulations, controls the lawfulness of manager selection and the progress of asset disposal, and facilitates ARMA’s engagement with civil society. The Council comprises nine members serving on a voluntary, unpaid basis. Sessions are held no less than quarterly, and its decisions are recommendatory in nature.

In the area of asset management, the Council has the following powers: 

• exercising civil oversight over the lawfulness and transparency of asset manager selection, by delegating its representatives directly to selection procedures; 
• monitoring the lawfulness and transparency of asset disposal and the effectiveness of the management of assets transferred to ARMA. 

The Head of ARMA may involve POC representatives in asset management effectiveness reviews and, where a complaint is received from an asset owner, in establishing grounds for a further review — up to and including membership of the relevant commission. POC representatives are correspondingly obliged to maintain the confidentiality of commercial and other legally protected information obtained in the course of such oversight activities.

The Council Formation Procedure establishes a competitive selection process through open-ranking online public voting. Candidates are nominated by civil society organizations active in anti-corruption, criminal justice or business protection for at least two years, and are subject to an extensive list of eligibility restrictions — including former ARMA employees, individuals with conflicts of interest, and foreign nationals. Voting must be conducted online for no fewer than three days, and the nine candidates with the highest vote tallies are deemed elected.

Previously, public oversight functions were performed by the Public Council at ARMA, which held a broad range of powers, including participation in the inter-agency asset disposal commission, oversight of budgetary expenditure, anti-corruption review, and the right to delegate representatives to competitive selection commissions. The new framework establishes the POC as a standing elected collegial body with enhanced powers in the area of asset management. The predecessor council has accordingly ceased to exist, while the new Council has yet to be constituted.

Additionally, the government approved the composition of the commission for conducting an independent external assessment (audit) of ARMA’s performance. Under the revised framework, all members of this commission are nominated by development partners, with a view to strengthening independence and eliminating undue influence from appointing entities.

Asset identification and intake

In this area, regrettably, no secondary legislation has yet been adopted. The government has yet to enact instruments governing how ARMA will store seized assets transferred to it for management, how valuators of seized assets will be selected, and what methodology will be applied to determine the feasibility of managing a given asset. 

In coordination with the Prosecutor General’s Office, instruments must be adopted to regulate asset identification and intake into management.

Interaction between law enforcement authorities and ARMA was previously ad hoc, which meant that assets that were objectively difficult to manage could be transferred to the Agency. The identification stage was introduced specifically to address this problem. On the other hand, there had been difficulties with prosecutors signing asset transfer and acceptance records; it is therefore significant that the Law now establishes deadlines for executing such records and mandates that these processes be regulated by joint orders of ARMA and the PGO at the secondary legislation level.

Separately, the appraiser selection procedure has yet to be aligned with the Law. A specific competitive selection procedure for valuation entities previously existed; however, the Law streamlined the process by providing that valuation entities are to be selected in accordance with the Law on Public Procurement. A draft instrument published on ARMA’s website specifies that valuation entities will be selected through open tender procedures in accordance with Article 15 of that Law, and that the corresponding framework agreement will be concluded for a term not exceeding one year. 

Selection of asset managers

We have previously addressed the updated framework for selecting managers of seized assets under the amended Law. On February 5, however, the government finally adopted the secondary legislation defining several important procedural nuances. TI Ukraine participated in the drafting of the asset manager selection instruments — our priority was to ensure that the substantive provisions and safeguards we developed were preserved through the subsequent clearance and adoption process. Fortunately, the structural logic and the safeguards were retained, and the text prepared with our involvement underwent primarily editorial revisions. 

The government has introduced its own definition of “related person” through four categories: related persons under the Tax Code, close persons under the Anti-Corruption Law, affiliated persons under the Joint-Stock Companies Law, and persons in civil-law or employment relationships with the owner or suspect where such relationships terminated fewer than five years before the announcement. 

For both simple and complex asset selection procedures, one open question remains: whether it is appropriate to cap the maximum manager’s remuneration at 100% of asset management profit. However, no sufficiently justified alternative approach was identified during the drafting process. Accordingly, unless the resolutions are amended, participants will be able to enter auctions at a starting remuneration level of 100%. 

Implementation of the selection procedures in the Prozorro system is ongoing, and initial steps have already been taken. 

Simple assets

For the pre-qualification of prospective managers, the resolution clarified the announcement timeline: it remains in effect from the date of publication until the date of the subsequent announcement, but no later than December 1 of the following year. Amendments to the announcement are prohibited throughout its validity period.

The resolution separately provides that the electronic system automatically calculates abnormally low tenders and notifies both the participant and ARMA — a mechanism not found in the Law, which merely defined the concept of an abnormally low tender and set deadlines for justification.

Pursuant to our proposals, the simple asset manager selection rules now include:

• a key safeguard providing that ARMA and the auction winner enter into a contract on the exact terms and at the exact remuneration level specified in the announcement and the winner’s tender, which neither the contracting authority nor the manager may vary unilaterally,
• the auction mechanics: the Prozorro system automatically evaluates tenders, including identification of abnormally low ones, and notifies both participants and ARMA. The correct sequence of participant actions is specified — the starting point is the highest remuneration level, each participant may lower the price by at least one step per auction stage, and where tenders are equal, the participant who submitted later proceeds first; 
• the necessary procedural detail: how tenders are submitted and recorded by the electronic system; the impossibility of submitting a tender after the established deadline; a participant’s right to submit only one tender, or to withdraw or amend it; the register of submitted tenders and its content; and separate provisions on the publication of information and documents. 

Additionally, the rules governing simple asset manager selection have the potential for improvement if future amendments were to:

• remove asset-specific details from the pre-qualification announcement, given that pre-qualification is not conducted in respect of specific assets — which are unknown at that stage;
• by analogy with the complex asset selection procedure, define what constitutes adequate justification for an abnormally low tender, and provide for publication of documents confirming a winner’s refusal to execute a management agreement;
• introduce a safeguard ensuring that the list of documents ARMA requires from pre-qualification participants is non-discriminatory and does not include documents not required by law;
• include in the auction announcement information on the owner of the seized asset and any suspect or accused in the relevant criminal proceedings, or any respondent in civil forfeiture proceedings (where applicable), so that participants and the public may assess any connection between such persons and the auction winner.

Complex assets

The new selection rules for complex asset managers focus on ensuring a transparent, non-discriminatory and clearly defined process. A key objective was to distinguish between the commission’s pre-auction document review and the automated evaluation of tenders (remuneration levels) in the auction itself, among participants admitted thereto — an area where the Law contained certain inaccuracies. 

Pursuant to TI Ukraine’s proposals, the following measures were incorporated: 

• a document deficiency cure mechanism: where the commission identifies deficiencies, it must issue a single request to the participant to remedy the documents within 24 hours;
• requirements for justifying abnormally low tenders: the resolution provides that adequate justification must include calculations demonstrating cost reductions, favorable conditions or increased revenue relative to the indicative plan;
• substantive limitations on additional qualification requirements: these must not restrict competition, create discrimination or confer advantages on specific entities, and must be proportionate to the management needs of the particular asset;
• regulation of cases where ARMA amends an announcement: the Agency has the right to make amendments prior to the deadline for document submission. To ensure non-discriminatory treatment, the document submission period is automatically extended so that at least ten days remain from the date of amendment until the deadline;
• a specific provision addressing the scenario where ARMA fails to issue clarifications in time: the Prozorro system automatically suspends the procedure and does not advance to the next stage; to reinstate the procedure, ARMA must publish its response and simultaneously extend the document submission period by at least seven days.

The government also elaborated on a number of procedural aspects of the selection process. ARMA prepares in advance a list of possible additional qualification requirements relating to participants’ experience, facilities, permits and licenses, which it transmits to the commission. The commission then decides whether to apply these requirements no later than two business days before the announcement is published. 

The resolution further clarifies the post-announcement procedure: the day after the document submission deadline, ARMA notifies the commission of the participants and transmits the relevant materials. Participation by joint ventures is regulated separately, with consolidated aggregation of their indicators.

To further improve the regulation of complex asset manager selection, it may be advisable to: 

• include in the auction announcement information on the owner of the seized asset and any suspect or accused in the relevant criminal proceedings, or any respondent in civil forfeiture proceedings (where applicable), so that participants and the public may assess any connection between such persons and the auction winner;
• add a clarification specifying that the list of information and/or documents required for the 24-hour deficiency cure must correspond to the requirements set out in the selection announcement, so that no new requirements are introduced at the proposal review stage;
• by analogy with the public procurement framework, introduce a safeguard ensuring that ARMA’s list of required documents does not include documents not required by law.

The resolution also regulates the operation of the Commission for the selection of the manager of complex assets. It provides for roll-call voting with each member’s position recorded in the minutes, individual written assessments by each member for each qualification requirement in respect of each participant separately, recusal and conflict-of-interest procedures with a mandatory disclosure obligation no later than the next business day, the right to record a dissenting opinion in writing, the option of remote sessions, and the commission’s right to invite participants to sessions and to send them written requests.

Procurement of asset management services

The ARMA Law provides that where no manager of a simple or complex asset is identified following a repeat selection procedure conducted under Article 21-3 or 21-4 of the Law, the Agency shall procure asset management services through an open tender procedure in accordance with the Law on Public Procurement. Participation in such procurement is open to business entities meeting the qualification requirements set out in Article 21-3(7) and Article 21-4(5) of the ARMA Law, except for participants who refused to execute a management agreement following simple or complex asset manager selection procedures.

The government resolution regulates the process for determining the estimated value of the procurement item — that is, the projected expenditure on engaging a manager, which serves as the basis for budget planning and tendering. 

Four instruments are established for calculating the estimated value, arranged in a hierarchy. The primary methods are market consultations (sending requests to market participants to ascertain current prices and possible management approaches) and the market price comparison method (a minimum of three price proposals, from which abnormally high and low figures are excluded, with the remaining proposals averaged). Where fewer than three proposals remain after filtering, historical procurement price analysis with inflation and exchange rate indexation is applied.

The fallback instrument is calculation on the basis of an approved indicative asset management plan — applied either where none of the preceding methods yields a result, or where the figures obtained exceed the planned values by a factor of two or more. The formula incorporates expected monthly management income, minimum storage costs, and the manager’s base remuneration at 10% of profit, multiplied by twelve months. The Procedure thus provides a methodological framework for a reasoned determination of the cost of management services in the most complex cases where market-based selection has not produced a result.

That said, the Procedure has certain shortcomings that it would be advisable to address in any future revision:

• insufficient safeguards against inflation of the estimated procurement value. In particular, for the market price comparison method to be applied effectively, requests to business entities should be identical in content for all recipients and should include all material conditions of service delivery, thereby enabling the solicitation of relevant pricing information and the formulation of proposals. As currently drafted, there are no requirements as to the content of the request. The class of economic operators to whom requests will be sent is framed rather broadly and is not entirely appropriate for management services — requests are directed primarily to “manufacturers, official representatives, and dealers,” whereas the procurement item is management services; 
• no provision for publication of any information on how ARMA determined the estimated value of the procurement; 
• the current definition of estimated value is rather broad — it encompasses “all possible costs associated with engaging a manager” and does not include the criterion of service delivery “on specific conditions,” in contrast, for example, to the definition of estimated value under the Ministry of Economy Order No. 275 of February 18, 2020. 

Attention should also be drawn to technical shortcomings in the Procedure. The market consultation process should yield not only “optimal procurement item requirements” but also the estimated value itself. Additionally, paragraph 8 of the Procedure should apply only “where the historical procurement price analysis method is used,” rather than in all cases of estimated value determination. 

The formula for calculating estimated value on the basis of historical procurement prices incorporates a “historical period price” figure. It is not, however, specified how a single historical period price is derived, given that the method generally draws on multiple sources. If the arithmetic mean is to be used in the formula, a provision to that effect — together with other relevant details — must be included.

Asset management and oversight

In this area, only the Procedure and Timelines for Developing, Approving, and Amending the Indicative Asset Management Plan, and the Procedure for Monitoring the Effectiveness of Asset Management, have been developed to date. The government has not yet adopted model management agreements.

The Procedure for Developing and Approving the Indicative Asset Management Plan elaborates on the mechanics of this document, which serves as the foundation for all subsequent manager selection procedures. Whereas the Law merely referenced the existence of the plan and its mandatory content, the resolution establishes specific drafting timelines: 20 business days for simple assets and 30 business days for complex assets, running from the date of execution of the transfer and acceptance certificate. For complex assets, an additional 20-business-day benchmark is introduced to maintain compliance with the statutory timelines for transferring an asset into management. 

The resolution also specifies the information sources for preparing the plan: the management feasibility assessment, the asset inspection report, valuation and expert findings, inventory data, and publicly available sources ranging from Prozorro to statistical services of foreign states. A notable new requirement is the mandatory approval of the plan by the National Security and Stock Market Committee (NSSMC) where the asset comprises a share in the capital or shares of a professional capital markets participant — with the NSSMC afforded ten business days for that purpose.

Regarding amendments to the plan, the resolution introduces several important procedural mechanisms. First, a manager may initiate amendments, but not earlier than 30 calendar days after taking the asset over — a safeguard against premature revision of planned performance benchmarks. The manager’s submission must include a list of proposed amendments, a reasoned justification with supporting calculations, and a risk analysis. ARMA must consider the submission within ten business days and communicate its decision within the following five business days; any refusal must be reasoned. Second, where amendments to the plan are made after the manager selection announcement has been published — for both simple and complex assets — the proposal submission period is automatically extended so that at least seven calendar days remain from the date of the amendment. Once the proposal submission deadline has passed, no further amendments to the plan are permitted — an important guarantee of the stability of competition conditions.

The government has also approved the Expenditure Approval Procedure for asset managers. This instrument establishes the mechanism for ARMA to approve the expenditures that managers incur in the effective management of seized assets and that are reimbursed from management revenues. The Procedure defines five categories of expenditure subject to approval: the manager’s remuneration; costs of asset maintenance and security; insurance costs; costs of professional services (consulting, legal, valuation, etc.); and other costs provided for in the indicative management plan and agreement. The overriding requirement is that all expenditures be economically justified, efficient and directed toward achieving the objectives of asset management.

The Procedure establishes a detailed approval process: the manager submits a cost estimate for the forthcoming reporting period, together with a justification, a market price analysis and a projected economic return calculation. ARMA conducts a comprehensive review — legal, financial-economic and technical — within 15 business days, and issues a reasoned decision to approve or refuse. Significantly, expenditures not approved by ARMA or exceeding approved amounts without supplementary authorization are not reimbursable. The procedure also mandates that the manager file reports on actual expenditure, with a comparison of planned against actual figures.

The Procedure for Monitoring the Effectiveness of Asset Management represents a substantial expansion of the conceptual apparatus compared to its predecessor: it introduces definitions of material agreement terms, management effectiveness criteria, complaints and complainants, and — critically — the concepts of potential and actual conflicts of interest on the part of the manager, with a clear distinction between them. Moreover, new management effectiveness criteria are now approved by a separate ARMA order, grounded in four principles: profitability, preservation of operational capacity, financial stability and economic viability — a dimension entirely absent from the previous procedure.

The architecture of oversight modalities has also been significantly restructured. The previous procedure provided for two forms: a desk review (conducted on ARMA premises) and a field review, with the desk review as the primary modality and field reviews reserved for cases arising from desk reviews or exceptional circumstances. The new procedure restructures the system entirely: it introduces a documentary review (equivalent to the former desk review, conducted no less than monthly, within up to seven business days), a field review (no less than quarterly, within up to 14 business days), and an additional complaint-triggered review (within up to seven business days). The field review is no longer derivative of the documentary review but is conducted independently on a regular basis. The minimum composition of the review commission has also changed, from three members under the previous procedure to four under the new one.

A fundamentally new element is the procedure for reviewing complaints lodged by asset owners. It provides for the establishment of a standing working group for complaint review, including two POC representatives; grants the authorized unit the right to conduct an additional review without mandatory prior notification to the manager; and establishes clear requirements as to the content of complaints and supporting documents. The participation of the POC has simultaneously been expanded — its representatives may be included in the review commission during additional complaint-triggered reviews. 

Procedural safeguards for managers have also been strengthened. The advance notice period for field reviews has been extended from two to five business days, and managers have been afforded more time to submit objections — five business days rather than three. The review report is now also sent to the manager’s email address as specified in the agreement, which was not previously required. Finally, the new procedure expands the grounds for action: in addition to the existing grounds of deficient management and attempts to dispose of assets, a new ground has been added — the identification of circumstances precluding preservation of an asset’s economic value — which triggers a distinct set of measures pursuant to Article 21-6 of the Law.

Asset disposal

The government has not adopted any new instruments on asset disposal. It should be noted that the ARMA Law specifies that asset disposal, with certain exceptions, is to be conducted through electronic auctions on the Prozorro.Sale electronic trading platform.

Although disposal was already conducted through that platform under the previous procedure, there are grounds for further regulatory improvement.

One such ground concerns the inability of former owners to acquire an asset — an issue illustrated by the sale of land on the Borzhava resort. Prohibiting this would align with international standards. For example, a new FATF guide on recovering assets obtained through crime notes that allowing criminals to regain their assets through auctions, even at market price, may undermine confiscation goals (such as deterrence) and damage the reputation of authorities. Some states conduct relevant checks on buyers. This is stated more directly in paragraph 40 of the Preamble to EU Directive 2024/1260 of April 24, 2024, which provides that the state should take measures to prevent assets from returning into the ownership of convicted persons or persons associated with them.

The allocation of assets into lots also warrants attention. In the Borzhava case, ARMA structured the disposal into just three lots: the first comprising 245 land plots, the second comprising 208 land plots, and the third comprising the lower terminal with a chairlift, the upper terminal of a ski lift, and 41 land plots. ARMA’s explanation — that the lots were formed taking into account the adjacency and size of the plots to maximize the commercial attractiveness of each lot and minimize the time to receipt of disposal proceeds — is far from persuasive, given that all prior auctions had been unsuccessful, save for the price-reduction auctions.

Maintenance of the seized assets register

The new Regulation on the Seized Assets Register was adopted by the Ministry of Justice rather than ARMA. This instrument substantially expands the scope of data recorded in the Register with respect to asset management activities. The previous instrument captured only proceeds from asset management and disposal. The new Regulation provides for detailed recording of the entire management lifecycle: the results of manager selection; the material terms of the management agreement, including remuneration; a link to the agreement itself; monthly management revenues; the amount of reimbursed costs; and the results of management effectiveness monitoring. Asset pools are now also recorded separately, with an indication of the economic, technological or functional unity of the assets comprising the pool. With respect to asset disposal, the Register now records a link to the electronic auction and the asset’s valuation, rather than merely the disposal proceeds.

The timelines and mechanism for entering information into the Register have also changed. The previous Regulation established a deadline of seven business days from receipt of data. The new Regulation has reduced this to the next business day following receipt of information from authorized entities. A right has also been introduced for the authorized official to return incomplete information with an indication of the missing particulars — a data quality mechanism that did not previously exist. The grounds for deletion of personal data have been clarified as well: the new Regulation adds the entry of an acquittal or the termination of criminal proceedings as distinct grounds for deletion, whereas the previous instrument was limited to the lifting of the seizure order.

Conclusions and recommendations

The ARMA reform enacted by Law No. 4503-IX constitutes a genuine systemic step forward — it has materially strengthened the mechanisms for manager selection, management effectiveness oversight, accountability and transparency. As of February 2026, however, the reform has been only partially implemented: a significant portion of the secondary legislation remains outstanding, without which the new mechanisms cannot become fully operational. This creates operational uncertainty and the risk that ambitious legislative changes will remain aspirational rather than effective.

In light of the foregoing, the following steps are recommended:

• adopt joint orders of ARMA and the Prosecutor General’s Office on the asset identification and intake procedures;
• approve the procedure for storing assets accepted into ARMA’s management and the methodology for determining management feasibility;
• adopt model asset management agreements and the expenditure approval procedure;
• align the appraiser selection procedure with the amended Law;
• adopt a revised asset disposal procedure incorporating key new features: a prohibition on asset acquisition by former owners or their related persons (in accordance with FATF standards and EU Directive 2024/1260), and clear lot formation criteria designed to maximize disposal proceeds;
• regulate the corresponding obligations of prosecutorial authorities with respect to the timelines and manner of responding to ARMA’s referrals on the need to transition to asset disposal.

It is also critically important to establish a monitoring mechanism for the implementation of adopted secondary instruments, incorporating the views of key stakeholders, in order to identify practical challenges and operational needs in the processes within the Agency’s remit. 

Overall, the pace of secondary legislation adoption is insufficient, given that the key provisions of the Law were to take effect as of February 2026. Notwithstanding this, provided that high-quality secondary legislation is adopted promptly, there remains a genuine prospect that ARMA will, in time, be able to build greater institutional credibility — both among other government authorities and with the broader public. 

Developing and approving the HACC development strategy 

In reviewing the Court’s internal administrative and organizational documents, the Accounting Chamber noted that they did not include a Development Strategy for the High Anti-Corruption Court as an institution. Such a document would define the institution’s fundamental directions of activity going forward. 

Although legislation does not require the HACC to approve a Development Strategy, the absence of such a strategy may negatively affect the Court’s planning processes and the achievement of its goals, the identification of strategic priorities, and the efficient use of available resources. A strategy would also be an important tool for demonstrating the Court’s openness, transparency, and accountability to the public. 

Against this background, the Accounting Chamber recommended that HACC develop and approve, by December 1, 2025, a Development Strategy that includes clearly defined priorities, strategic goals, and specific measures to achieve them. 

It is notable that the European Commission made a similar recommendation for the HACC (to develop a strategy to ensure the effectiveness of judicial proceedings) in November, in its 2025 EU Enlargement Report on Ukraine as a candidate country.  

In late November, the HACC reported that it had approved its 2026–2028 Institutional Development Strategy, meaning the Accounting Chamber’s recommendation was implemented on time.

Court staffing

One of the key problems affecting support for the High Anti-Corruption Court remains staff shortages—both among judges and within the Court’s staff. 

At the time of the audit, HACC’s judicial positions were filled at slightly under 60%: the actual number of judges administering justice, including judges of the HACC Appeals Chamber, was 37 out of the 63 available positions. This situation led to increased workload for judges, longer case consideration times, and an accumulation of cases. According to the Accounting Chamber, from September 2019 to November 2024, the number of pending criminal proceedings before the High Anti-Corruption Court doubled. 

One of the main factors driving the substantial gap between the approved number of judges and the Court’s actual staffing levels was the lengthy second competition for selecting HACC judges, which began in November 2023 and was ongoing at the time of the audit. 

The audit found significant delays at certain stages of the selection procedures. In particular, the qualification assessment of candidates was scheduled only seven months after the competition was announced, and the qualification exam was scheduled four months after the qualification assessment. Ultimately, the appointment of the selected candidates—only two remained after completing the competition—did not take place until June 2025.

The prolonged judicial selection competition not only hindered the Court’s ability to secure the necessary human resources, but also created risks of Ukraine failing to meet its international commitments under the Ukraine Facility Plan. That plan envisioned a 60% increase in the authorized number of HACC judges in the first quarter of 2025.

As a result, the Accounting Chamber recommended that the High Qualification Commission of Judges (HQCJ), as the body responsible for announcing and conducting the selection of HACC judges, establish deadline timeframes for competitive selection procedures for judicial positions. This timeframe was to begin upon publication on the Commission’s official website of information on the results of considering candidates’ admission, take into account the completion of the qualification assessment and/or participation in the competition, and end with the adoption of a decision identifying the competition winners. 

In May 2025, the HQCJ amended the Regulation on the Procedure and Methodology for Qualification Assessment and the tools used to determine it, including provisions allowing the Commission to set deadlines for qualification assessment by its decision, thereby implementing the Accounting Chamber’s recommendation.

The absence of established timeframes for selection procedures was not the only problem in selecting candidates for judicial positions at the High Anti-Corruption Court. Other shortcomings include a narrowed pool of potential candidates due to specific work experience requirements, an excessively short initial document submission period, incorrect questions in the test database, and an unjustifiably high passing score in the cognitive test. However, these shortcomings were not reflected in the audit report, which may indicate an incomplete analysis of problematic aspects of the HACC judicial selection process. 

In terms of staffing the HACC apparatus, the audit recorded a discrepancy between the actual number of HACC staff members and the authorized staffing levels. In particular, more than 120 positions remained vacant; these were established to support the work of newly appointed judges. In view of this, the Accounting Chamber recommended that, by July 1, 2025, the High Anti-Corruption Court initiate and implement effective measures to accelerate staffing of the Court’s apparatus after the full complement of judges is appointed.

In March, the HACC informed the Accounting Chamber that it had appointed 10 HACC staff members to support the work of judges who were to be appointed as a result of the judicial selection competition. At the same time, the Court announced a selection process to create a personnel reserve for 110 vacant positions to be filled after the remaining judges are appointed. Accordingly, implementation of the recommendation is ongoing.

Preventing delays in case consideration 

In assessing the High Anti-Corruption Court’s performance of its judicial mandate, the audit recorded an increase in the number of pending criminal proceedings, which negatively affects the timeframes for their consideration.

This situation was driven both by objective factors—such as the pandemic, the introduction of martial law, and the insufficient number of judges—and by shortcomings in legislative regulation. The latter include limited procedural mechanisms to counter certain abuses of rights by participants in proceedings, an insufficient range of preventive measures in legislation, and the requirement to restart criminal proceedings in the event a judge is replaced on the panel.

Importantly, amendments to criminal procedural legislation aimed at increasing the pace of consideration of corruption and corruption-related criminal offenses had already been planned as one of the measures under the State Anti-Corruption Program. However, the only change that was implemented was allowing criminal proceedings in the HACC, as a court of first instance, to be heard by a single judge.

Therefore, following the audit, the Accounting Chamber recommended that the National Agency on Corruption Prevention (NACP), as the implementer of the relevant measure under the State Anti-Corruption Program, prepare and submit to the government a draft law addressing:

• the inadmissibility of abuse of procedural rights by participants in criminal proceedings, as well as enabling an investigating judge or the court to recognize certain actions or omissions by such participants as an abuse; 
• expanding the grounds for imposing monetary penalties for breaches of obligations by participants in criminal proceedings and increasing the amounts of such penalties;
• simplifying the procedure for serving summonses in criminal proceedings on Ukrainian citizens residing abroad;
• narrowing the grounds for adjourning court hearings;
• establishing a procedure and defining the scope and sequence for examining evidence at a court hearing;
• enabling the court to pronounce only the introductory and operative parts of a lengthy verdict, with mandatory service or dispatch of the full text of the verdict to participants in the court proceedings on the day it is pronounced. 

In addition, the Accounting Chamber recommended that the Cabinet of Ministers of Ukraine take measures to draft and submit to Parliament a draft law allowing a criminal trial to continue if a judge who is not the presiding judge is replaced.

In its research, TI Ukraine has repeatedly highlighted the negative trend of delays in HACC proceedings. Our monitoring found that procedural abuses aimed at delaying court consideration are recorded in 55% of cases. Legislation lacks an effective mechanism to counter such abuses. 

In its 2025 report on Ukraine, the European Commission also emphasized the need to amend the Criminal Procedure Code in order to reduce obstacles and procedural delays in criminal proceedings, especially in high-level corruption cases. 

The Accounting Chamber’s recommendations also align with ours in terms of increasing the amounts of fines and monetary penalties for contempt of court and improper procedural conduct, as well as the need to resolve the problem of restarting a case after a judge is replaced. 

NACP drafted the draft law on Amendments to the Criminal Procedure Code of Ukraine on the Inadmissibility of Abuse of Procedural Rights and, starting in late 2024, sent it to the government for consideration three times. However, in the first two instances, the draft law was returned due to disagreements with the Ministry of Justice, the State Bureau of Investigations, and the Ukrainian Parliament Commissioner for Human Rights.  The most recent attempt to submit the bill to the Cabinet of Ministers took place in July 2025, but due to the government’s resignation, the document was returned again. As of late September, NACP was preparing the draft law for renewed coordination and resubmission, so implementation of the Accounting Chamber’s recommendation remains ongoing.

Unlike NACP, the government did not support the Accounting Chamber’s proposed approach to allowing a criminal trial to continue when a judge who is not the presiding judge is replaced. In the Ministry of Justice’s view, this approach contradicts the general principles of criminal proceedings because it would violate the principle of direct examination of evidence in criminal proceedings. 

However, as early as February 2024, members of Parliament registered a relevant draft law, but it was not placed on the agenda. Therefore, the prospects for adopting such amendments—as well as for implementing the Accounting Chamber’s recommendation by the government—appear unlikely.

Updating court performance and case consideration indicators

Among the other recommendations issued by the Accounting Chamber, it is worth highlighting the need to update HACC’s basic performance indicators by adding an indicator showing the percentage of decisions quashed or amended by higher courts out of the total number of decisions, as well as the need to introduce an indicator for the average length of case consideration for categories within HACC’s jurisdiction. 

The first indicator is essential for assessing the quality of judicial activity, including court decisions, and makes it possible to identify negative trends in a timely manner and respond to them. However, the HACC did not calculate or report this indicator because it was not required by law. Following the Accounting Chamber’s recommendation, the Council of Judges of Ukraine added the relevant indicator to the approved list of Basic Court Performance Indicators. Nevertheless, for almost a year, the administrator of the court’s automated case management system—Information Judicial Systems State Enterprise—has been unable to configure the required functionality, meaning the indicator of quashed and amended decisions is still not being calculated.

Indicators for the average duration of case consideration, in turn, affect the determination of judges’ workload. However, a judge workload level as a criterion for caseload has not been established, making it impossible to assess the effectiveness of the judicial process overall or to determine whether organizational changes are needed. 

Uncertainty around indicators related to the duration of case consideration also makes it impossible to calculate the cost of considering a single case. In view of this, the Accounting Chamber recommended that the High Council of Justice (HCJ) develop and implement indicators for the average duration of case consideration for categories within HACC’s jurisdiction, based on analytical research and consultations with stakeholders.

This initiative was supported by the State Judicial Administration of Ukraine and by the High Anti-Corruption Court itself, and in August the HCJ established a working group to develop and implement indicators for the average duration of case consideration for categories within the jurisdiction of the High Anti-Corruption Court.

Conclusion

The compliance audit of the High Anti-Corruption Court not only highlighted a number of pressing problems affecting support for the Court’s operations—particularly staff shortages and delays in case consideration—but also formulated relevant recommendations to address them. Notably, the substance of these recommendations partly aligns with the position of the European Commission and with TI Ukraine’s analytical findings.

The relevance of the recommendations is also confirmed by the level of their implementation: of the 13 recommendations issued following the audit, the High Anti-Corruption Court and the relevant public authorities implemented 7 within a year, and another 5 are in the process of implementation. Only in one case has implementation not begun—namely, the recommendation that the government draft a bill allowing a criminal trial to continue if a judge is replaced.

In assessing the audit’s impact, it is worth noting the High Anti-Corruption Court’s support for the audit approach to evaluating whether the Court’s operations are adequately resourced, as well as its active communication about existing problems in its work and possible ways to address them. In addition, HACC’s direct implementation of most of the recommendations addressed to it indicates that they are appropriate and responsive to the Court’s operational needs.

However, to improve the effectiveness of the High Anti-Corruption Court, the remaining Accounting Chamber recommendations also need to be implemented. Particularly, resolving the problem of having to restart criminal cases when a judge is replaced and introducing mechanisms to prevent abuse of procedural rights.

In addition, to strengthen HACC’s institutional capacity and improve the effectiveness of anti-corruption efforts, TI Ukraine recommends:

• comprehensively improving legislation on statutes of limitations (by establishing additional grounds for suspending limitation periods, extending their duration, and changing the end point for calculating them);   
• abolishing the automatic closure of cases due to the expiration of pre-trial investigation time limits;
• revising the provisions on single-judge consideration and extending them to civil forfeiture cases;
• requiring mandatory special confiscation when approving plea agreements.

At the same time, the implementation of a significant portion of the recommendations that require legislative amendments falls within the remit of other bodies. For this reason, it is advisable for the Accounting Chamber to continue actively monitoring the status of their implementation and to respond appropriately in cases of delay or inaction by the responsible entities.

Early practice 

In 2017, amendments to the Law of Ukraine on the Prosecutor’s Office entered into force. These amendments were intended to reform the disciplinary mechanism applicable to prosecutors. In particular, the authority to hold prosecutors disciplinarily liable was vested in the Qualification and Disciplinary Commission of Prosecutors (QDCP). From the start of its work, the QDCP was the first body to begin using materials from covert investigative actions in a systematic manner in its proceedings. 

According to a study by the Center of Policy and Legal Reform, in 2017–2018 the QDCP relied on information obtained covertly by law enforcement in 25 out of 196 decisions imposing disciplinary sanctions. In most of these cases, dismissal was selected as the sanction. The study reports that, as of the time of analysis in 2019, none of the QDCP’s decisions had been overturned by the Supreme Court. 

According to an analysis by the DEJURE Foundation, following the QDCP’s practice, the HCJ also began using this instrument in disciplinary proceedings against judges. Although at first the HCJ’s practice lacked a consistent approach (its Disciplinary Chambers could adopt opposing decisions on the use of covert investigation materials within the same week), the HCJ’s approach has since become fairly uniform: 50 judges have been subjected to disciplinary liability. 

Arguments against the use of covert investigation materials

An analysis of the early practice of disciplinary bodies, concluded and pending cases before the Supreme Court, as well as legal commentary on this topic, makes it possible to identify the following arguments against using covert investigation materials in disciplinary proceedings: 

1. such use violates the right to respect for private life and correspondence guaranteed by Article 8 of the European Convention on Human Rights (ECHR); 
2. imposing disciplinary liability on the basis of such materials violates the presumption of innocence; 
3. imposing disciplinary liability on the basis of such materials violates the ne bis in idem principle. 

In our view, these arguments do not demonstrate that the use of covert investigation materials in disciplinary proceedings is impossible.

Interference with private communications and correspondence

Article 8 of the ECHR prohibits public authorities from interfering with a person’s right to respect for private and family life, home, and correspondence. Certain covert investigative measures clearly constitute such interference. 

However, the Convention itself permits interference if three criteria are met with respect to the state’s actions:

1. in accordance with the law, 
2. a legitimate aim of the interference (in the interests of national security, public safety or the economic well-being of the country, for the prevention of disorder or crime, for the protection of health or morals, or for the protection of the rights and freedoms of others), and
3. the necessity of the interference in a democratic society (that is, whether the reasons were relevant and sufficient and whether the decision-making process was fair and capable of ensuring adequate protection of the interests at stake).

Against these criteria, we consider whether materials from covert investigative (search) actions may be used in disciplinary proceedings. 

“In accordance with the law”

Under the case law of the European Court of Human Rights, interference must have a basis in domestic law that is properly accessible and formulated with sufficient precision to be foreseeable. 

The Criminal Procedure Code of Ukraine, in its foundational principles, provides that in criminal proceedings everyone is guaranteed the secrecy of correspondence, telephone conversations, telegraphic and other correspondence, and other forms of communication (Article 14(1) of the Criminal Procedure Code of Ukraine), as well as non-interference with private (personal and family) life (Article 15(1) of the Criminal Procedure Code). 

These provisions also state that information obtained as a result of interference with communications (Article 14(3) of the Criminal Procedure Code) and information concerning private life (Article 15(3) of the Criminal Procedure Code) may not be used other than for the purposes of addressing/performing the tasks of criminal proceedings. They cannot be interpreted in isolation from the process in which they are applied. The point is that the Criminal Procedure Code regulates the process of criminal liability, not disciplinary liability. This was also noted by Anatolii Miroshnychenko, a member of the High Council of Justice, in his dissenting opinion to the decision of the Third Disciplinary Chamber of the High Council of Justice of April 10, 2019 No. 1106/3dp/15-19.

In other words, in the context of using covert investigative (search) materials in disciplinary cases, these provisions should be understood as meaning that pre-trial investigation authorities may not use such information outside criminal proceedings.

At the same time, the Criminal Procedure Code itself provides that information obtained through covert investigative actions may go beyond the bounds of the criminal process (Article 257). If a ruling of an investigating judge is required to use such information in another criminal proceeding, the Criminal Procedure Code does not specify the mechanism for using it for other purposes. Accordingly, it is logical to transfer this information on the basis of Article 222(1) of the Criminal Procedure Code, which sets out the general rule on lifting the secrecy of the pre-trial investigation and disclosing such information. 

This approach is also supported by the position of the Grand Chamber of the Supreme Court. In particular, in its resolution of October 22, 2019 in case No. 9901/918/18, the Grand Chamber recognized the lawfulness of the QDCP obtaining materials from an ongoing criminal proceeding—including covert investigative (search) materials—as evidence in disciplinary proceedings: 

“61. In this regard, the Grand Chamber of the Supreme Court notes that information necessary for the Commission to exercise its powers may be obtained from any sources in the manner established by law. Therefore, the Commission requested and received, for the purposes of adopting the contested decision, copies of the materials of the criminal proceeding, the authorization to use which within the disciplinary proceeding, pursuant to Article 222 of the Criminal Procedure Code, was granted directly by the prosecutor. 

(…) 

63. Accordingly, there are no grounds to conclude that the evidence used in the disciplinary proceedings was obtained unlawfully.”

If we turn to disciplinary proceedings, the collection and admissibility of evidence are governed by the Law of Ukraine on the Judiciary and the Status of Judges and the Law of Ukraine on the High Council of Justice. In this context, these laws are the special legislation applicable to disciplinary proceedings, and they do not contain restrictions on the sources from which evidence may be obtained. 

Particular attention should be paid to the regulation of operational and search activities. In particular, the relevant units are required to inform the competent public authorities of facts and data known to them indicating legal violations related to the official activities of public officials (Article 7(4) of the Law of Ukraine on Operational Search Activities). In other words, the legislature has expressly provided for the transfer of information obtained covertly.

The existence of established Supreme Court case law on the admissibility of using covert investigative materials in disciplinary proceedings is important when assessing foreseeability as an element of the “quality of law.” 

The European Court of Human Rights has developed two requirements under the “in accordance with the law” criterion: the law must be accessible, and the norm must be formulated with sufficient precision to enable a citizen to regulate his conduct (The Sunday Times v. the United Kingdom, No. 6538/74, § 49).

In addition, the concept of “law” must be understood in a substantive, not merely formal, sense. It encompasses not only statutes in the narrow sense, but also subordinate legislation and unwritten law, including settled case law, which plays a major role in legal system of the Continental States (Kruslin v. France, No. 11801/85, § 29). 

Therefore, even if one were to assume, in theory, that the relevant legal basis in legislation could be regarded as insufficiently clear, the consistent and settled judicial interpretation of that basis eliminated any legal uncertainty. 

Legitimate aim and necessity in a democratic society

To assess whether the interference pursued a legitimate aim and was necessary in a democratic society, it is useful to refer to the most recent judgment of the European Court of Human Rights in Adomaitis v. Lithuania (No. 14833/18), in which the Court examined a comparable situation. 

In that case, the applicant was the director of a Lithuanian prison, whose telephone conversations were intercepted for a year and who was subjected to other covert surveillance on suspicion of abuse of office. Although the criminal proceedings were discontinued for lack of grounds for prosecution, the collected materials, authorized by a prosecutor, were used in disciplinary proceedings.

The ECHR held that the interference pursued a legitimate aim within the meaning of Article 8(2) of the Convention—namely, the prevention of crime and the protection of the rights and freedoms of others. The use of covert surveillance materials was also found to be aimed at ensuring transparency and openness in the public service, which the Court expressly treated as a legitimate aim of the interference (Adomaitis v. Lithuania, No. 14833/18, § 84).

In the Ukrainian context, the overwhelming majority of the cases considered by the High Council of Justice involved unlawful benefits or other corruption offenses; and since the start of the full-scale invasion, also conduct related to national security. Disciplinary review of cases supported by such materials clearly pursued a legitimate aim not only of protecting national interests—among other things by removing the relevant individuals from office—but also of performing a broader public function. This includes restoring trust in public institutions, implementing the principle of accountability, and safeguarding the authority of justice as a whole.

When assessing the necessity and proportionality of using information obtained in criminal proceedings, the ECHR took into account, among other factors, the aim of ensuring the effectiveness of law-enforcement institutions and high ethical standards for senior public officials. The seriousness of the alleged corruption conduct was also important. The use of these materials was clearly limited by law, and the applicant had the opportunity to challenge both the reliability of the evidence and the proportionality of the interference (Adomaitis v. Lithuania, No. 14833/18, § 87).

There is also another approach, for example, a judgment of the Court of Justice of the European Union concerning a prosecutor dismissed following disciplinary proceedings. The proceedings were based on materials obtained through interference with electronic communications and mobile-communications metadata. 

The prosecutor argued that the transfer of this information was inconsistent with Directive 2002/58/EC concerning the processing of personal data and the protection of privacy in the electronic communications sector. That directive prohibits interference with private communications, subject to a limited list of exceptions. 

The Court of Justice focused on the list of exceptions and stated that it contains a hierarchy from more to less significant aims. If materials were obtained under one exception (for example, the investigation of serious crime), they may be used only for more significant aims within the list (for example, protecting national security and public security). The Court indicated that disciplinary proceedings carry less weight in this hierarchy of aims. At the same time, the arguments of the governments of the Czech Republic and Ireland, referred to in the judgment, that such disciplinary proceedings concern public security, were rejected solely because the national court, in deciding the case, did not refer to any serious threat to public security (A.G. v. Lietuvos Respublikos generalinė prokuratūra, §§ 41–42).

Accordingly, the Court of Justice did not engage with the argument that disciplinary proceedings linked to corrupt conduct could relate to public security. In Ukrainian disciplinary practice, judges have been dismissed, among other grounds, based on evidence of involvement in corrupt conduct. Therefore, given the lack of reasoning and the absence of an assessment of the admissibility of such an approach, it cannot be stated with certainty that the Court considers the transfer of such materials to a disciplinary body to be categorically impermissible. 

Returning to the Ukrainian context, it should be noted that standards of integrity and professional ethics for judges are, in practice, among the highest applicable to any public officials. This follows from the scope of judges’ powers, as well as the exceptional guarantees of their independence and protection. In these circumstances, the seriousness of the recorded facts and the nature of the position support the necessity and proportionality of using materials from covert investigative (search) actions. 

At the same time, judges were not deprived of effective remedies. They were enabled to challenge the relevance and admissibility of the evidence in the criminal proceedings, and to contest its use in the disciplinary process. Moreover, judges could challenge in court both the submission of such materials to the disciplinary body and the manner in which those materials were assessed.

Violation of the presumption of innocence

Another argument against using materials from covert investigative (search) actions is that finding a disciplinary offense on the basis of such materials allegedly amounts to finding a person guilty of a crime without a court conviction. In other words, the disciplinary body is said to “prematurely” determine the existence of a crime before a court ruling. 

The presumption of innocence guarantees that a person is considered not guilty of committing a crime until a guilty verdict enters into legal force (Article 62 of the Constitution of Ukraine). It is important to understand that this refers specifically to a conviction on a criminal charge. 

Disciplinary proceedings, by their subject matter, respondent, standard of proof, procedure, and other features, are not a criminal charge. In particular, a disciplinary body does not determine whether the elements of a crime are present; it analyzes certain circumstances through the lens of professional ethics. Accordingly, disciplinary liability cannot, under any circumstances, be equated with a finding that a person is guilty of committing a crime. Moreover, a disciplinary decision has no binding effect for criminal proceedings, as the Grand Chamber of the Supreme Court also stated in its resolution of January 22, 2019 in case No. 800/454/17.

A situation is entirely possible in which a person may be held disciplinarily liable even though they were acquitted in criminal proceedings or the criminal proceedings were terminated. This approach is consistent with the case law of the European Court of Human Rights, as the Grand Chamber of the Supreme Court also noted, in particular, in its resolution of April 25, 2018 in case No. 800/547/17: 

“According to the case law of the European Court of Human Rights, it does not violate Article 6 of the Convention to impose disciplinary liability on the basis of information about facts established in criminal proceedings, where such information was analyzed from the perspective of rules of official ethics, even if the person was acquitted in the criminal proceedings (see, mutatis mutandis, the decision of the European Commission of Human Rights of October 6, 1982 in X v. Austria declaring application No. 9295/81 inadmissible) or the proceedings were terminated (see, mutatis mutandis, the decision of the European Commission of Human Rights of October 7, 1987 in C v. the United Kingdom declaring application No. 11882/85 inadmissible).”

In that decision, the Grand Chamber of the Supreme Court expressly indicated that the presumption of innocence cannot be extended to the disciplinary procedure.

Violation of the ne bis in idem principle

Closely related to the preceding claim is the argument that imposing disciplinary liability on the basis of materials from criminal proceedings may allegedly result in a violation of the prohibition on holding a person liable twice for the same conduct. 

However, the Constitution of Ukraine provides that no one may be held twice to legal liability of the same type for the same offense (the first paragraph of Article 61). 

Criminal liability and disciplinary liability are different types of legal liability. As noted above, the European Court of Human Rights allows disciplinary liability for conduct that was the subject of criminal proceedings, even where the person was acquitted or the proceedings were terminated. 

The Venice Commission has also repeatedly noted the possibility of applying different types of liability specifically to judges (Opinion No. 880/2017, CDL-AD(2017)002, § 18). 

Can the Supreme Court change its own case law? 

The Grand Chamber of the Supreme Court has repeatedly departed from prior case law, including its own. However, the positions of the Supreme Court carry significant weight: legal conclusions on the application of legal norms set out in its decisions are binding on all public authorities (Article 13(5) of the Law of Ukraine on the Judiciary and the Status of Judges). 

For this reason as well, such a shift must have sufficient grounds. The Grand Chamber of the Supreme Court has identified such grounds, in particular, in its resolution of June 8, 2022 in case No. 362/643/21:

• deficiencies in the previous decision or group of decisions (ineffectiveness, lack of clarity, inconsistency, insufficient reasoning, imbalance, or error); 
• changes in the societal context such that the approach applied in those decisions has clearly become outdated due to the development of social relations in a particular area or changes in their legal regulation.

As a result of the analysis, and from the perspective of an outside observer, the established case law does not display material deficiencies that would justify changing it. Nor have there been significant changes in the societal context since 2017 that would require a shift in approach. Moreover, the use of materials from covert investigative (search) actions in disciplinary proceedings has demonstrated its effectiveness.

Conclusions

The issue of using materials from covert investigative (search) actions in disciplinary proceedings unquestionably remains debatable. At the same time, existing national practice, the experience of other countries, and the approach of international institutions in situations similar in substance suggest that the use of such materials in disciplinary proceedings may be considered acceptable, provided that clear safeguards are observed. In particular, recent judgments of the European Court of Human Rights, as well as the consistent case law of the Grand Chamber of the Supreme Court, indicate the permissibility of this mechanism as one that does not conflict with human-rights guarantees.

Accordingly, in Ukraine’s current realities, there are sufficient legal and institutional preconditions to preserve the existing approach to using such materials in disciplinary proceedings against judges. There are no grounds today to revise that approach or refuse from it. 

This mechanism has already become an important element of accountability of the judiciary and of restoring trust in it. Information about the significant number of judges dismissed through disciplinary procedures on the basis of such materials convincingly demonstrates the system’s capacity for self-cleansing. At the same time, the use of covert investigative (search) actions must, of course, remain measured and proportional, and must comply with human rights and procedural safeguards—so that the pursuit of integrity does not turn into a threat to judicial independence.

NACP Effectiveness

Compared to the last year’s report on the European Commission’s enlargement policy towards Ukraine, this year’s report was much more critical in its assessment of the work of the National Agency on Corruption Prevention (NACP). Although some recommendations were transferred from the previous to the fresh report, many new ones were added. In particular, the Commission recommended the following: 

1. Expand the personal scope of declarants regarding the patronage of high-ranking officials and simplify and improve the procedures for verifying declarations.
2. Strengthen the NACP’s capacity and focus on identifying unjustified assets.

These recommendations are fully consistent with ours, which we described in both this year’s Shadow Report and the previous one.

In this context, the European Commission noted that, overall, the NACP retains its central role in shaping anti-corruption policy and preventing corruption. However, it also expressed concern about its impartiality and effectiveness in some functions. The Commission called on the Agency to urgently implement all the recommendations of the report published in July 2023 by the commission on the independent assessment of the NACP’s effectiveness. The next such assessment should be carried out without further delay, using a reliable methodology and criteria — another crucial recommendation from the European Commissioners, which we fully support.

The EU also stressed that the Agency needs to ensure that its internal processes are regulated through binding bylaws rather than through non-binding recommendations or similar documents. This issue has also been repeatedly mentioned in both the NACP audit report and our analysis.

Importantly, the report also mentions the need to strengthen the e-declaration system in order to effectively prevent and detect unjustified assets, which is also in line with our recommendations. The Commission pointed out that the system has practical and legal shortcomings, primarily related to the (automated) verification process, in particular the verification methodology and the risk-based approach applied. 

The Commission also noted that a certain degree of external oversight over logical and arithmetic control (LAC) of declarations should be ensured. Back in 2021, we called on the Agency to make the LAC rules accessible, as they determine the level of risk of a declaration and its subsequent selection for verification. The publication of these rules in previous years allowed public experts to identify shortcomings and propose ways to address them. At present, it is not possible to assess whether the rules established by the NACP are sufficiently effective.

Despite this criticism, the report positively assesses the effectiveness and results of lifestyle monitoring of public officials (LSM). TI Ukraine does not share this position, as the current LSM procedure is not properly regulated and effectively duplicates the content of a full declaration check. Moreover, when conducting this type of control, the NACP does not use automated distribution among authorized persons. This poses a risk that specific categories of declarants or even individuals will be checked by specially designated NACP employees, which means there is a possibility of political influence on this process. 

Overall, the Commission emphasized that more attention should be paid to the practical application of financial control tools to high-ranking officials. After all, during the period under review, there were many reports of allegations of unjustified assets and hidden property. Parliament should further increase penalties for unjustified assets and lower the applicable thresholds to make the sanctions regime more relevant and effective. In addition, the obligation to declare assets should also cover the patronage of private offices of high-ranking officials, including advisors and assistants. We fully support these recommendations.

The Enlargement Report also raises the issue of insufficient human resources at the NACP. In particular, it states that competitive salaries and a clear internal personnel policy are necessary to attract and retain qualified employees. In addition, the Agency has created sectoral expert units, which now need to be empowered to provide additional methodological support to anti-corruption units and officials of public authorities and state-owned enterprises. Similarly, the skills, professionalism, and accountability of anti-corruption commissioners need to be strengthened. We agree that the NACP’s staffing should be enhanced, given its heavy workload, particularly due to the Agency’s central role in anti-corruption mainstreaming in negotiations with the EU.

In the section on effectiveness, the European Commission noted that the number of reports of corruption received by the NACP increased significantly, from 534 in 2023 to 982 in 2024, but the number of confirmed whistleblowers fell from 25 in 2023 to 17 in 2024. Only a small number of individuals were convicted in criminal proceedings based on whistleblower reports (0.47% of proceedings in ordinary courts; 5% in proceedings in the High Anti-Corruption Court).

The Commission also mentioned the anti-corruption review of draft laws by the NACP and the specialized committee of the Verkhovna Rada. In their opinion, which is consistent with ours, this review is not currently systematic, and the recommendations made by the Agency based on its results are not consistently implemented.

With regard to strategic documents, the European Commission assessed the impact of the Anti-Corruption Strategy for 2021-2025 and the State Anti-Corruption Program as limited due to gaps in their implementation, indicating the need for nationwide participation.

The Commission called for the development and adoption of a new Anti-Corruption Strategy for 2026-2030 and a State Anti-Corruption Program without delay in a transparent and inclusive manner. They should include an ambitious but realistic level of priority measures in areas most prone to corruption, such as public procurement, reconstruction, energy, infrastructure, construction and land management, the judiciary and law enforcement, customs and taxation, extractive industries and natural resources. To avoid problems with the implementation of the future strategy, it is necessary to strengthen capacities and resources, particularly at the level of the NACP. In addition, there is an urgent need to strengthen law enforcement structures and the regular participation of (high-level) political coordination bodies. All of these recommendations also echo those we described in the Shadow Report.

Furthermore, the Commission rightly noted that most public bodies have adopted anti-corruption programs, but these rarely address root causes of corruption, and the NACP needs to strengthen its quality control over them. Certain local authorities and smaller state-owned enterprises are not required to develop such programs, which remains an issue that needs to be addressed.

Finally, the report mentions that the NACP needs to develop its capacity to effectively and impartially monitor compliance with lobbying legislation. This is a new area of responsibility for the Agency, which we believe does indeed require additional attention.

Thus, with regard to the work of the NACP, the European Commission recommended:

• Expanding the list of declarants regarding the patronage of private offices of high-ranking officials.
• Simplifying and improving the procedures for verifying declarations. 
• Strengthening the NACP’s capacity and focusing on identifying unjustified assets.
• Urgently implementing the outstanding recommendations of the report based on the results of an independent assessment of the Agency’s effectiveness in 2023 and ensuring that a new assessment is carried out in a timely manner using an updated methodology.
• Ensuring the regulation of the NACP’s internal processes through binding bylaws.
• Publishing the LAC rules to monitor their application.
• Enhancing the NACP’s staffing, in particular by increasing salaries.
• Developing and adopting a new Anti-Corruption Strategy for 2026-2030 and a State Anti-Corruption Program without delay in a transparent and inclusive manner. 
• Developing the NACP’s capacity to effectively and impartially monitor compliance with lobbying legislation.

 

What did the European Commission not mention?

Despite comprehensive recommendations on the development of the next cycle of anti-corruption policy, the Commission briefly mentioned the limited impact of existing strategic documents. Last year’s report referred to the need to introduce sanctions for systematic non-compliance with the State Anti-Corruption Program (SAP) measures, which was quite specific. At the same time, this year, European Commissioners limited themselves to a general opinion on the need for nationwide participation. Our Shadow Report describes specific problems with the implementation of the current Anti-Corruption Strategy and the SAP and recommendations on how to solve them.

This year, the European Commission did not mention the shortcomings of the Unified Whistleblower’s Reporting Portal. These include the requirement for whistleblowers to provide a legal assessment of a possible offense at the stage of submitting a report, the ability of the whistleblower’s supervisor to view the archive of such reports, the lack of a TOR version of the portal, and other non-compliance with best standards of anonymity and confidentiality. The challenges of the Politdata register of political parties reporting o were neither mentioned.

 

Conclusion

This year’s assessment of the NACP’s work by the European Commission covers virtually all of the Agency’s problems that have long been criticized by the public. Despite its controversial position on lifestyle monitoring of declarants, the EC has described the necessary reforms of the financial control system quite comprehensively, with an emphasis on transparency and inclusiveness. Updates in this area should be a priority for the NACP, and we hope that the Agency will heed the EU.

Anti-corruption segment of criminal justice

Compared to the previous European Commission report, which noted that Ukraine had made some progress in the fight against corruption, this year’s assessment was more limited. The Commission noted that its recommendations from last year had been partially implemented and remained relevant. 

At the same time, the report states that the number of indictments in NABU cases has increased, while the total number of suspects and defendants has decreased slightly. At the same time, the number of indictments in corruption cases investigated by the National Police (NPU), the State Bureau of Investigations (SBI), and the Economic Security Bureau of Ukraine (ESBU) has decreased. Many cases remained without a court decision, and the number of closed cases also increased. We drew attention to this problem in the Shadow Report and emphasized that the reasons for the increase in the number of closed cases need to be thoroughly analyzed. At the same time, it is necessary to improve statistical reporting mechanisms so that the results of the work of pre-trial investigation bodies and court proceedings are more comparable.

The European Commission noted that the number of cases considered by the High Anti-Corruption Court (HACC) remains at a level similar to the previous year, while the number of convictions, including final convictions, has increased slightly. 

However, the EC draws attention to a critical problem: the average length of court proceedings is very high, leading to a backlog of cases. We have repeatedly highlighted this problem in our reports monitoring the work of the HACC.

This issue has become even more acute due to the ineffective second competition of HACC judges, which may lead to even greater court overload due to unfilled vacancies. Therefore, it is crucial to successfully complete the new competition for HACC judge positions with the involvement of the Public Council of International Experts (PCIE), identifying honest and professional judges. Also, in order to eliminate significant delays, reduce the backlog of cases, and shorten the time required for consideration, the High Anti-Corruption Court should develop a comprehensive strategy to ensure the effectiveness of the judicial process.

The European Commission notes positive progress in civil forfeiture but identifies the low number of seizures and final confiscations of assets in high-level corruption cases as a critical issue. Further progress is needed in this area, including through effective parallel financial investigations. This issue should also be addressed in line with the measures set out in the relevant Roadmap.

The European Commission notes that the legal framework for combating corruption is in place but needs to be further strengthened. 

At the same time, Ukraine should extend the statute of limitations and review the grounds for its interruption and suspension in line with European standards to ensure sufficient time for proper investigation, prosecution, and adjudication of corruption and corruption-related offenses. This is also in line with our recommendations from the latest report on monitoring the work of the HACC. During the year, this recommendation has become even more relevant due to the growing number of cases that may be closed due to the expiry of the statute of limitations. The Rule of Law Roadmap provides for the implementation of these measures only by the second quarter of 2027, which is an unacceptably long period.

The EC paid particular attention to legislative initiatives that exempt certain defense companies from criminal liability or introduce unjustified restrictions on criminal liability and investigations, including for corruption and other economic crimes. This refers, in particular, to draft law No. 12439, which needs to be substantially revised.

The European Commission also reported on the risk of undermining public trust in anti-corruption institutions through unfounded public statements and the creation in June 2025 of a Temporary Investigative Commission with a broad mandate to investigate possible corruption in law enforcement agencies, courts, and judicial bodies. This risks going beyond the limits imposed by the separation of powers. 

The European Commission also noted that the position of the Prosecutor General remains politicized. It recommended adopting legislative changes to make the procedures for selecting and dismissing the Prosecutor General more objective, transparent, and merit-based. We also emphasized this in our materials.

Thus, with regard to the fight against corruption, the European Commission recommended:

• Resolving the problem of lengthy court proceedings in corruption cases at the highest level. This could be facilitated by the introduction of an institution to counter abuse of cases in the High Anti-Corruption Court.
• Extending the statute of limitations and reviewing the grounds for its interruption and suspension in accordance with European standards. 
• Removing the provision on the automatic closure of criminal cases due to the expiry of the pre-trial investigation period and revising the current time limits to ensure sufficient time for criminal investigations. 
• Improving confiscation mechanisms and ensuring effective parallel financial investigations.
• Implementing all recommendations of the NABU audit. 
• Removing restrictions that prevent the full deployment of the iCase system. 
• Granting the NABU access to autonomous wiretapping and independent forensic examinations, as well as the ability to wiretap communications without involving other agencies. 
• Granting the head of the SAPO the authority to initiate investigations and approve investigative actions against MPs independently of the Prosecutor General. 
• Reviewing exceptions for high-ranking officials regarding sole consideration of cases to ensure proportionality and impact on the effectiveness of judicial proceedings. 
• Improving the rules on the jurisdiction of the NABU and introducing guarantees for their proper enforcement. 

 

What did the European Commission not mention?

The European Commission’s report does not directly address the issue of enforcement of penalties in the form of property confiscation, which we have written about in separate studies. However, the section on justice states that Ukraine should adopt additional legislation to improve the enforcement of court decisions related to monetary and non-monetary obligations. 

In addition, it does not explicitly mention the problem that the issue of early release of convicted persons is decided by the local court at the place of imprisonment. The reason for this may be the focus on the stages of pre-trial investigation and court proceedings in corruption cases and the limited communication about the results of the enforcement of such decisions, even though they are the main goal of the entire process.

 

Conclusion

The European Commission rightly notes the progress made in building a track record of fighting high-level corruption, but at the same time identifies critical systemic challenges. Of particular importance are the recommendations on improving the statute of limitations, granting the NABU autonomous wiretapping powers, abolishing the automatic closure of cases due to the expiry of the pre-trial investigation period, and strengthening the effectiveness of asset confiscation. These issues require urgent corrective measures at the legislative and institutional levels.

Fight against organized crime

As in the previous year, the European Commission noted some progress in the fight against organized crime this year. The report states that the legal framework is partially aligned with the EU acquis, but the capacity to fight serious and organized crime needs to be improved. 

The European Commission notes that Ukrainian law enforcement agencies have begun to implement some measures within the framework of the comprehensive strategic plan for law enforcement reform (CSP). The EC stresses that the continued implementation of the CSP until the end of 2027, together with the relevant parts of the Rule of Law Roadmap in Chapter 24, is crucial for reforming the civilian security sector in line with European standards. We consider this recommendation to be important. As our Shadow Report shows, the CSP Action Plan contains points aimed at strengthening public control and accountability of the NPU, the SBI, and the ESBU. However, certain measures need to be improved during the drafting of regulatory acts, especially regarding the involvement of independent (including international) experts in the competition commissions for the selection of managers. 

The European Commission notes that Ukraine has strengthened the legal framework for financial investigations by adopting the relevant implementing legislation. It also notes that the Ministry of Internal Affairs is preparing a Financial Investigation Strategy. However, it is important that the Ministry of Internal Affairs conducts public consultations with experts during the preparation of this document.  

The European Commission shares the recommendations expressed in the Shadow Report to ensure the systematic, effective, and timely conduct of financial investigations. To this end, it is important to allocate sufficient resources, provide training, grant access to the necessary databases, and develop practical guidelines and tools.  

The European Commission also drew attention to the law that disproportionately restricted access to public registers during martial law. The issue is that the President of Ukraine did not heed the calls of more than 50 civil society organizations and journalists to veto the law on the specifics of providing information from public electronic registers. The European Commission expressed concern about these changes, as investigations into financial crimes are often initiated based on reports from civil society and the media. The EC also drew attention to controversial amendments to the Criminal Procedure Code, which are ostensibly aimed at protecting business. They could undermine the effectiveness of financial and criminal investigations into economic crimes and the investigative independence of the ESBU. 

The European Commission noted positively in its report the adoption of the law on the reform of the Asset Recovery and Management Agency (ARMA), which introduced a competitive selection process for the agency’s head, regular independent audits, and a revised asset management system. However, it noted that for the reform to be fully implemented, relevant implementing legislation needs to be adopted, and an independent assessment of the Agency’s effectiveness needs to be carried out. In our view, this primarily concerns amendments to the Criminal Procedure Code of Ukraine to ensure effective interaction between the ARMA and the prosecution authorities. 

In line with our Shadow Report, the European Commission noted that many convictions for money laundering were based on plea bargains with subsequent release without imprisonment. It noted that financial investigations are still hampered by the lack of reliable information on property ownership, company structures, bank records, and cross-border transactions. The “follow the money” approach is largely absent. 

The EC report also pointed to the problem of the lack of consolidated statistics on confiscations and mentioned that less than 3% of the assets traced by the ARMA were transferred to it for management. An audit of the agency by the Accounting Chamber revealed some shortcomings in asset management and the selection of managers, which should be addressed in light of the agency’s reform. 

The European Commission noted that the appointment of the head of the State Financial Monitoring Service (SFMS) took place without a competition due to the provisions of the legislation on martial law and stressed that the SFMS should have the necessary capabilities and resources to effectively fulfill its mandate, in particular to ensure timely and high-quality intelligence. 

It is important that the EC did not overlook the fact that the current rules and judicial practice regarding the inadmissibility of evidence collected by an unauthorized law enforcement agency, together with the unclear division and fragmentation of competences, undermine the fight against complex forms of organized crime and increase the risk of corruption. This refers to the practice of the Supreme Court of declaring evidence collected in violation of the rules of jurisdiction inadmissible. Unfortunately, such examples still occur. 

In general, with regard to financial investigations, confiscations, and law enforcement management, the European Commission recommended: 

• Implementing the Comprehensive Strategic Plan for Law Enforcement Reform (CSP) by the end of 2027, together with the relevant parts of the Rule of Law Roadmap in Section 24. 
• Ensuring the effectiveness of financial investigations by allocating sufficient resources and databases so that financial investigations are conducted systematically, effectively, and at an early stage in parallel with criminal investigations. 
• Adopting legislation to establish a bank account registry and close the legislative gap on virtual assets. 
• Restoring access to information on real estate rights registered to any legal entities in electronic form. 
• Refraining from adopting controversial amendments to the CPC ostensibly aimed at “protecting business” but in reality, designed to undermine the effectiveness of financial and criminal investigations of economic crimes.
• Improving asset confiscation mechanisms to allow for pre-trial seizure of assets for extended confiscation and confiscation of proceeds (“special forfeiture”). Rules on confiscation without conviction in criminal proceedings should be further aligned with the EU Directive on the recovery and confiscation of assets.
• Strengthening the capabilities of the State Financial Monitoring Service. 
• Introducing transparent procedures for selecting the heads of the NPU and the SBI.
• Addressing shortcomings in the work of the Asset Recovery and Management Agency in light of ongoing reforms. 

 

What did the European Commission not mention?

Although the European Commission draws attention to the reform of the ARMA, it does not assess how effectively the Asset Recovery Strategy is being implemented. At the same time, we can note that by the end of 2025, according to the Action Plan for its implementation, measures should be introduced, in particular, regarding the reform of the confiscation mechanism. Unfortunately, we do not see their implementation.

Also, despite the fact that the report explicitly states that the head of the State Financial Monitoring Service was appointed without a competition, the European Commission did not pay attention to the fact that the current legislation does not provide for high-quality competitive procedures, although such competitions are held for positions in anti-corruption bodies.

 

Conclusion

Ukraine has a serious task ahead of it in the fight against organized crime. The effectiveness of the fight against corruption depends, among other things, on the completion of this task. After all, corruption is an integral element that determines the existence of organized crime, and due to unfounded prosecutions and institutional conflicts between the NABU/SAPO and other pre-trial investigation bodies, the focus of attention is blurred and valuable resources are lost. 

Regional policy

First of all, the European Commission noted progress in lawmaking in the field of regional policy, in particular the approval of the Action Plan for 2025–2027 on the implementation of the State Strategy for Regional Development for 2024–2027. At the same time, the Report emphasizes that the aforementioned Plan, as well as community development strategies, should more closely integrate the requirements of public investment management reform. It also stresses the importance of developing digital tools, primarily the DREAM system (which is a “bank” of public investment projects within the reform). 

In terms of local planning, the EC generally sees a need to clarify and streamline the content and structure of local strategic documents.” Local authorities are advised to logically combine such documents with sources of funding. In other words, strategies should be based on an assessment of real needs and capabilities.

The European Commission also noted a number of other decisions at the central level. These include steps such as the appointment of the Deputy Prime Minister for Recovery – Minister of Community and Territorial Development as the head of the Interdepartmental Coordination Commission; provision in the 2025 state budget for funding to restore the State Regional Development Fund, etc. According to the EC, Ukraine should make more efforts to create a legal system that would involve local authorities, the public, and partners in all stages of planning, in the spirit of the European Code of Conduct on Partnership. 

The report emphasizes transparent and accountable financial management, especially in matters of recovery. The European Commission recommends developing an approach to reporting on the use of Ukraine Facility funds and other sources of financing so that the entire process complies with the principles of EU cohesion policy: subsidiarity (so that decisions are made at the level where they will be implemented), effectiveness (so that funds deliver tangible results), accountability (so that authorities explain their actions), and the participation of subnational authorities in decision-making (so that communities have a real say in the allocation of resources).

For local authorities, this means planning recovery projects taking into account the real needs of the community, using allocated funds transparently, reporting regularly, involving the public in decision-making, and ensuring control over the effectiveness and efficiency of resource use. 

The European Commission makes similar recommendations on auditing and control, noting that internal and external audit functions exist (in particular, the Accounting Chamber, which now has the power to audit local budgets), but their work does not yet meet international standards. The report describes the implementation of audits at the community level as “unevenly effective.” For local authorities, this could be an opportunity to strengthen their own internal control and financial transparency mechanisms: according to the Transparent Cities program, less than a third of Ukraine’s 100 largest cities have internal audit departments, and only four of them report on the results of their work.

Therefore, the European Commission recommends that local authorities:

• Develop or update strategic documents for communities based on an assessment of needs and resources. Back up strategies with implementation plans. 
• Maintain dialogue with the public, business representatives, and international partners through proper communication and proactive engagement.
• Use the DREAM system to manage and monitor recovery projects.
• Enhance transparency in financial management through regular reporting on the use of budget funds. 
• Develop or expand internal audit and control mechanisms. 

What did the European Commission not mention? 

The European Commission mentions administrative capacity in the field of regional policy only at the level of the Ministry of Community and Territorial Development. At the same time, the report does not address the issue of personnel stability in local self-government, which remains one of the challenges for communities in wartime.  

In addition, the European Commission considers the fight against corruption at the regional level through the prism of control and audit, while the development of local anti-corruption infrastructure is no less important – strengthening the role of anti-corruption commissioners, approving and implementing local anti-corruption programs, training on integrity issues, etc.

 

Conclusions

Guided by the European Commission’s recommendations, local authorities are contributing to Ukraine’s European integration and opening up opportunities to strengthen governance, increase trust, and move towards sustainable transparency practices. The extent to which communities consistently and effectively build transparent financial processes, strategic planning, and interaction with residents will determine their readiness for European rules of the game. 

Financial control

External audit

In this year’s report, the European Commission has, for the first time in recent years, highly praised Ukraine’s progress in the field of external audit. Amendments to the Law “On the Accounting Chamber” adopted at the end of last year played a significant role in this. They helped bring national legislation closer to the International Standards for Supreme Audit Institutions (ISSAI) and expanded the mandate of the Accounting Chamber (AC), which was one of the European Commission’s recommendations in 2024.

However, the key recommendation regarding the activities of the country’s supreme audit institution remained almost unchanged compared to the last year: it is necessary to strengthen the political and financial independence of the Accounting Chamber, as well as to enahnce its administrative capacity, in particular by completing the formation of its management. And over the past year, this recommendation has become even more relevant.

To strengthen the political independence of the body in 2024, amendments to the law introduced, among other things, an updated competitive selection procedure for members of the Accounting Chamber, with a decisive voting right for international experts and an emphasis on transparency. However, more than 10 months later, the competition has not yet begun due to the parliament’s inability to form an advisory group of experts (AGE) to select candidates. TI Ukraine has called on parliamentarians to consider the experience and reputation of experts and form an AGE to unblock the competition.

In the context of the need to strengthen the administrative capacity of the body, it should be noted that more than a third (35%) of the positions of state auditors remain vacant in the Accounting Chamber. After approving the competitive selection procedure at the end of January 2025 and transferring current employees to the positions of state auditors, the body announced only two competitions, both in July 2025. As a result, only 15 state auditors were appointed, which is approximately 3% of the total staff. Under these conditions, the effective functioning of the Accounting Chamber remains questionable, especially given the significant expansion of its control powers, as noted by the European Commission in its report.

Despite progress in improving national legislation, full compliance with international standards remains a challenge. European experts emphasize that the Accounting Chamber should not only continue to implement approved audit methodologies in its work but also create quality control mechanisms to regularly assess the effectiveness of its audits. This will ensure their compliance with international standards of transparency and accountability.

However, not all of the EC’s conclusions and recommendations regarding the work of the Accounting Chamber can be agreed with.

With regard to the financial independence of the body, at the end of 2024, officials of the Accounting Chamber, including state auditors, were removed from under the scope of the Law on Public Service, and the amounts of their official salaries and allowances were established directly in the specialized law, which leaves them outside the influence of the government. In addition, in January 2025, parliament amended the Budget Code to introduce a special procedure for the government and parliament to consider the Accounting Chamber’s budget requests. In this context, the EC’s recommendation to further strengthen the financial independence of the Accounting Chamber appears debatable.

In their report, European experts also noted progress in monitoring the implementation of audit recommendations and developing specialized IT tools. The requirement to carry out such monitoring and publish its results was enshrined in the Law on the Accounting Chamber at the end of 2024. At the same time, the AC Regulations stipulate that monitoring must be carried out in accordance with the procedure approved by the authority. However, neither the published internal documents of the Accounting Chamber nor the materials on the implementation of recommendations mention the relevant Procedure for Monitoring the Implementation of Decisions. This gives reason to assume that such a document has not been approved.

Thus, for further European integration progress in the field of external audit, Ukraine needs to:

• Strengthen the political and financial independence of the Accounting Chamber, as well as enhance its administrative capacity, in particular by completing the formation of its management.
• In addition, the European Commission recommended that the Accounting Chamber:
• Prioritize the effective implementation of approved audit methodologies based on International Standards for Supreme Audit Institutions in its work.
• Develop robust quality assurance mechanisms to regularly assess the effectiveness of its audits, ensuring their compliance with international standards of transparency and accountability.
• Select audits for inclusion in the 2026 work plan based on risk and impact assessments.
• Increase the number of audits of consolidated financial statements of public sector entities and budgets in 2026.

 

Conclusions

In its report, the European Commission gave a positive assessment of Ukraine’s progress in the field of external audit. However, it should be noted that it focused more on progress in adopting legislative changes. In our opinion, Ukraine would also benefit from a critical assessment of the lack of real implementation of these innovations. In particular, the fact that in more than 10 months, the Ukrainian parliament had not been able to take a key step to strengthen the political independence of the Accounting Chamber — to form a commission to launch a competitive selection process for its members.

As for the recommendations provided, most of them, with the exception of strengthening the financial independence of the Accounting Chamber, are relevant and generally consistent with the position of TI Ukraine.

Protecting the EU’s financial interests

One of the priorities for improving the financial control system in the process of Ukraine’s European integration is to ensure adequate protection of the EU’s financial interests. This issue has become particularly relevant following the launch of the Ukraine Facility macro-financial assistance program, which provides for €50 billion from the EU in the form of grants and loans to support the recovery, reconstruction, and modernization of Ukraine for the period from 2024 to 2027.

In September last year, as part of the introduction of a national mechanism for coordinating the interaction of state authorities to protect the financial interests of Ukraine and the EU, the government authorized the State Audit Service of Ukraine to perform the functions of the Anti-Fraud Coordination Service. In addition, Ukraine has committed itself, within the framework of the Ukraine Facility, to amend its legislation by the end of 2025 in order to strengthen the capacity of the State Audit Service in the field of protecting the financial interests of the EU (this refers to the harmonization of our practices with international standards) and to increase the effectiveness of procurement monitoring measures.

As of early November, the relevant legislative changes had not been adopted, so the European Commission formulated a similar recommendation: in accordance with the Plan for Ukraine, amend the legislation on financial control to strengthen the system of state financial control, including the role and powers of the State Audit Service in protecting the EU’s financial interests.

TI Ukraine supports this recommendation. We have previously emphasized that problems may arise at the level of national legislation when the State Audit Service exercises the powers of the Anti-Fraud Coordination Service. The State Audit Service should assist the European Anti-Fraud Office (OLAF) in conducting administrative investigations and audits on the territory of Ukraine. However, its specialists do not have sufficient powers to access documents and information held by business entities and individuals that may be necessary for investigating violations within the Ukraine Facility. Therefore, without amendments to the legislation, investigations into possible misuse of EU funds may be significantly complicated.

In its report, the European Commission noted the partial alignment of Ukraine’s national legislation with the EU acquis in the area of protecting the EU’s financial interests. At the same time, it recommended that Ukraine fully adapt its legislation to the requirements of the EU Directive on combating fraud affecting the financial interests of the European Union. This will enable the competent national authorities to cooperate effectively with OLAF during investigations in Ukraine, including on-the-spot checks and access to information contained in national databases relevant to the investigations.

In the context of protecting the EU’s financial interests, there is also a mention of the need to develop and implement a National Anti-Fraud Strategy to protect EU funds. This task has been assigned to the State Audit Service of Ukraine, but there is no public information about the approval of such a strategy.

In the area of protecting the EU’s financial interests, the European Commission has recommended:

• Amending the legislation on financial control to strengthen the system of state financial control, including the role and powers of the State Audit Service in protecting the EU’s financial interests.
• Adapting national legislation to the requirements of the EU Directive on combating fraud affecting the financial interests of the European Union.
• Developing and implementing a National Anti-Fraud Strategy to protect EU funds.

 

Conclusions

In summary, the European Commission’s recommendations on ensuring adequate protection of the EU’s financial interests appear to be well-founded and largely coincide with the position of TI Ukraine.

Internal audit

In the area of internal audit, Ukraine has only partially implemented last year’s recommendation from the European Commission; experts noted in the report legislative changes that: 

• updated the definition of “internal audit” in line with the Global Standards for Internal Auditing; 
• clarified and strengthened management responsibility for the functioning of internal control and the implementation of internal audit; 
• provided for the creation of audit committees in key budget administrators.

However, as in the previous report, the key recommendation remains unchanged: Ukraine needs to improve the quality of internal audit in the public sector by applying the new Global Standards for Internal Auditing and strengthening the role and capacity of the Ministry of Finance’s Department for Harmonization of State Internal Financial Control.

Notably, the 2025 report repeats not only the recommendations in this area, but also references from last year’s report, in particular, about “creating a strategic framework for internal audit as part of the 2022-2025 public finance management reform strategy” and “establishing a commission for the certification of the internal audit function at the Ministry of Finance.” This leads to the conclusion that there has been no significant progress in the field of internal audit.

Therefore, in the area of internal audit, the European Commission recommended:

• Improving the quality of internal audit in the public sector by applying the new Global Standards for Internal Audit.
• Strengthening the role and capacity of the Department for Harmonization of Public Internal Financial Control of the Ministry of Finance.

Public procurement

In assessing the area of public procurement, the European Commission noted that Ukraine has a certain level of preparedness and has made limited progress. Last year’s recommendations have been only partially implemented and remain valid. 

This year’s progress was made possible primarily by the implementation of the Strategy for Reforming the Public Procurement System for 2024-2026 (hereinafter referred to as the Strategy) and its Action Plan. In particular, the European Commission positively noted the steps taken to professionalize procuring entities, develop the Prozorro system, and increase transparency and efficiency. 

At the same time, the European Commission recommends adjusting the Strategy to more clearly define its goals, objectives, and performance indicators. The DOZORRO project of TI Ukraine also drew attention to this, as in some cases the indicators currently refer more to the process than to the achievement of a specific result. 

Another goal of improving the Strategy should be to optimize control measures and the fight against corruption. In particular, the mechanism for refusing participants in procurement should become more effective on all grounds provided for by the EU acquis, especially in connection with corruption crimes. The report also mentions integrity criteria for tender participants — it is necessary to ensure that these requirements are met.

The European Commission recalled that Ukraine does not have a separate anti-corruption strategy specifically for the procurement sector and that one needs to be approved. However, we hope that next year a separate section of the state’s Anti-Corruption Strategy will be devoted to public procurement. It is currently being developed, and TI Ukraine is preparing a study on the main corruption problems in this area, the results of which will form the basis of the strategy. Calling for the adoption of the Anti-Corruption Strategy without delay, the European Commission mentions public procurement among the areas most prone to corruption and which should be included in the strategy as a matter of priority.

According to the European Commission’s assessment, procurement legislation is still only partially aligned with the EU acquis. The new law on public procurement, which the European Commission itself calls long-awaited, has not yet been adopted. Draft law No. 11520 is still being finalized and prepared for consideration in the second reading. 

Instead, in the summer, the Verkhovna Rada adopted a new law on public-private partnerships (PPPs), which is also included in the procurement section of the Association Agreement. However, the European Commission notes that it has significant differences from the EU acquis, in particular, it does not fully equalize access to PPPs for Ukrainian and European companies. Therefore, this law needs to be revised, and the PPP and concession system needs to be made more attractive for investment. TI Ukraine has pointed out the risks and problems of the draft law, such as insufficient transparency of procedures and excessive discretion of tender committees.

Therefore, the main recommendation for the coming year, as last year, is to make progress in bringing legislation on public procurement, PPPs, concessions, and defense procurement into line with the EU acquis. At the same time, it is important to ensure that European companies can participate in domestic procurement, PPPs, and concessions on an equal footing with Ukrainian companies, without any discrimination. 

In general, we support this recommendation as an indispensable condition for our European integration progress. At the same time, work on draft law No. 11520 has shown that some Ukrainian approaches to the regulation and implementation of procurement are more advanced than those in EU countries. For example, this year TI Ukraine submitted proposals for changes to European public procurement regulations during the European Commission’s public consultations.

When reviewing the procurement legislation, the European Commission also noted in its report on temporary exceptions to it. These exceptions concern the grounds for concluding contracts directly instead of competitive procedures for amounts above the threshold. This right is provided for by Cabinet Resolution No. 1178 of October 12, 2022 (as amended), which regulates the specifics of public procurement during martial law. The European Commission notes that the scope of exceptions related primarily to the needs of martial law has been expanded. However, unlike the previous report, there are no specific recommendations on this issue this year. Apparently, this is covered by the general requirement to harmonize legislation with the EU acquis. After all, during the work on draft law No. 11520, the list of exceptions is one of the most controversial parts. 

The European Commission also briefly mentions that legislation on the right to legal remedy in the field of public procurement is partially harmonized with the EU acquis. However, it does not provide specific warnings or recommendations as to what the non-compliance of the other part consists of and what steps need to be taken to eliminate it.

Instead, considerable attention is paid to procurement control. The Ministry of Finance’s adoption of a new methodology for determining automatic risk indicators, their list, and the procedure for their application was recognized as a positive step in this area. However, as noted in the report, the State Audit Service initiates only a small portion of its monitoring based on risk indicators. As for the results of monitoring, according to the European Commission’s assessment, they are rarely challenged in court, and even if they are, the courts more often side with the plaintiffs. 

European Commissioners characterize internal and external control in procurement as weak, especially at the early stage, before the conclusion of a contract. The same applies to risk assessment within procuring entities and the prevention of conflicts of interest in the field. The European Commission links the limited effectiveness of internal control and audit to a lack of human and financial resources. It notes that only in a few cases are the identified violations successfully eliminated, especially in the case of large-scale contracts.

Therefore, the key recommendation is to focus legislation on strengthening control measures for procurement procedures and to strengthen the role and capabilities of monitoring. In particular, priority should be given to risk-based preventive control measures and effective responses to identified violations. Similar recommendations were previously provided by TI Ukraine. This challenge is particularly important for procurement using EU funds, and the European Commission refers to the Ukraine Plan in these recommendations.

Defense procurement was also paid more attention in this year’s report. The European Commission noted the introduction of authorized persons in military units, a long-awaited reform. At the same time, it pointed out that the legislation still lacks clarity regarding the distinction between civilian and defense procurement, as well as cases of political interference in the work of organizations that carry out centralized procurement for the military. Most likely, this refers to the scandal surrounding the change of the head of the DPA in the winter of 2025, when Arsen Zhumadilov was appointed to the position of head of the enterprise instead of Maryna Bezrukova.

As for procurement practices, the European Commission indicated that 68% of the value of our procurement transactions is accounted for by competitive procedures. However, there are discrepancies in the calculations of the competition indicator: according to the European Commission, it averaged 1.55 participants per lot, while according to BI Prozorro, it was 1.59 in 2023 and 1.88 in 2024. However, it remains indisputable that the share of tenders with a single participant remains high.

In assessing these procurement transactions, the European Commission notes an excessive dependence on price as the sole criterion for awarding contracts — in its opinion, this indicates an imbalance in the prioritization of price over quality. The latter point seems debatable, since maximum quality requirements can be stipulated in the terms of a procurement transaction without non-price criteria. In addition, procuring entities who deem it appropriate have the opportunity to set them, although they rarely do so. The report also notes limited progress in the area of mandatory energy efficiency criteria.

European Commissioners recommend that procuring entities continue to build their capacity in procurement process management. The update of training resources, in particular free online courses, was positively noted. The report also mentioned the creation of a new Central Procurement Agency for the Recovery Agency. 

Other recommended steps include introducing new tools and electronic contracts in the Prozorro system and improving interaction with the DREAM system and other state IT systems. 

And since procurement is carried out in all areas of public administration and social life, it is mentioned in many sections of the report. For example, in the healthcare sector, the fight against corruption in medical procurement is considered a key priority, and when assessing the development of the transport sector, the European Commission did not ignore Ukrzaliznytsia’s fight against several cases of corruption, including in the procurement sector. 

Thus, for further European integration progress in the field of public procurement, the European Commission recommends:

• Adopting a new law on public procurement, PPPs, and concessions, in particular by eliminating discriminatory conditions for EU companies.
• Adjusting the Strategy with a clearer definition of goals, objectives, and performance indicators.
• Strengthening procurement control, in particular monitoring, focusing on preventive risk-oriented measures and effective response to violations.
• Optimizing control and anti-corruption measures, ensure that the grounds for refusing to participate in procurement comply with the EU acquis and are effective.
• Covering the area of procurement in the future Anti-Corruption Strategy.
• Building the capacity of contracting authorities to manage procurement.
• Introducing new tools and electronic contracts in the Prozorro system, improving interaction with the DREAM system and other state IT systems. 

 

What did the European Commission not mention?

There are other problems in the field of procurement, such as the inability to appeal the qualification and decisions of procuring entities in above-threshold procurement transactions in the Prozorro Market electronic catalog. However, this and some other problems should be resolved by the adoption of draft law No. 11520. 

 

Conclusions

In summary, the European Commission’s recommendations seem reasonable and largely coincide with the positions of TI Ukraine. Efforts should be focused on harmonizing legislation with the EU acquis, while preserving our own achievements in this area, as well as improving control over procurement.

Reconstruction

Although the European Commission’s report does not contain a separate section on reconstruction, various parts of the document contain references and recommendations relating to this area.

In its report, the EC classified reconstruction as one of the areas most vulnerable to corruption and stressed the need to include priority and realistic measures to prevent it in the new State Anti-Corruption Strategy for 2026-2030 and the corresponding State Anti-Corruption Program, which should be developed in a transparent and inclusive manner. In this context, it should be noted that the NACP has held and plans to continue discussions with experts from civil society on priority issues in the field of recovery as part of the preparation of the draft Anti-Corruption Strategy.

The issue of developing and implementing a recovery strategy is directly linked to the field of regional policy. Despite the progress made in strategic planning at the local level, European experts have drawn attention to the need to streamline and refine the content and structure of local strategic documents.

This is an important recommendation, as the system for planning and implementing regional policy currently consists of more than 20 documents at all levels of government (national, regional, and local). All of these documents relate in one way or another to similar planning processes, including the strategic vision for recovery, and the structure of the documents is often duplicated. This applies in particular to recovery plans and comprehensive recovery programs at the local community level, which are developed on the basis of the same data and contain similar structural sections in terms of content.

At the institutional level, European experts noted the creation of a centralized procurement organization under the State Agency for Infrastructure Recovery and Development as part of an experimental government project to minimize risks and standardize procurement procedures in the recovery process. 

With regard to the Agency for Restoration, the European Commission recommended intensifying efforts to complete the legal and regulatory framework in order to consolidate the agency as a transparent and accountable institution with clearly defined powers and adequate resources to effectively carry out its tasks. Previously, Transparency International Ukraine also drew attention to the Agency’s limited influence on the activities of regional recovery services, due to their status as separate legal entities, and stressed the need to reorganize the body into a single legal entity in order to strengthen control over the work of regional units.

The European Commission’s report also noted the development of DREAM as an element of public investment management reform, which covers, in particular, the financing of recovery projects. It is based on the creation of unified project portfolios at the central, regional, and local levels, which are based on transparent mechanisms for prioritization, evaluation, and selection for the formation of public investment project portfolios. Despite noticeable progress, European experts drew attention to the need to formally define the role of the DREAM system and ensure its continued functioning. This recommendation coincides with the position of TI Ukraine — the status and obligation to apply the system to recovery projects must be defined and enshrined in law.

For areas related to recovery, the European Commission recommended, in particular:

• Clarifying the legal requirements for the content and structure of local strategic documents.
• Intensifying efforts to complete the legal and regulatory process with a view to consolidating the State Agency for Infrastructure Recovery and Development.
• Formally establishing the role of the DREAM system and ensuring its continued functioning.

 

Conclusion

TI Ukraine welcomes the European Commission’s recommendations on reconstruction, as they are consistent with the organization’s position and emphasize the need to enhance the transparency, accountability, and coordination of reconstruction processes. The European Commission’s report draws attention to key issues previously identified by TI Ukraine, in particular the need for legal regulation of the status of the Agency for Restoration and increased control over its regional divisions, streamlining the strategic planning document system, and legally enshrining the DREAM system.

Competition for the High Qualification Commission of Judges

The European Commission separately mentioned the issue of ending the participation of international experts in the competition for the position of member of the High Qualification Commission of Judges. In particular, it pointed out that although the terms of office of almost all members of the HQCJ will end in 2027, the formation of the Selection Commission is the responsibility of unreformed national bodies. Therefore, the report emphasizes that the formation of a new Selection Commission should be discontinued and that the participation of independent experts nominated by international partners should be continued instead. 

This recommendation of the report is clearly positive. We have repeatedly pointed out that the termination of the participation of international experts in the competition for the HQCJ threatens the independence of future competitions for judicial positions and creates a negative precedent for the withdrawal of independent experts from one of the key competitions. The importance of this was also emphasized by 90 civil society organizations. Draft law No. 13382 has already been registered in parliament, which could extend the participation of international experts. However, since its registration in June, the specialized committee of the Verkhovna Rada has not yet managed to consider it.

What is it like now?

Although the Law on Corruption Prevention requires a mandatory biennial audit of the NACP’s activities, the last assessment was conducted more than two years ago and covered the period from 2020 to 2021. Since then, the Agency has a new Head, but many ineffective practices remain. The European Commission also notes this in its latest report.

Given the NACP’s lack of transparency and insufficient accountability, an international expert audit of the Agency’s effectiveness in 2024–2025 (the first two years of the new Head’s term) is a constructive step toward improving the quality of corruption-prevention policy and declaration verification. 

Before this, however, the audit methodology and criteria adopted in 2020 must be updated, as they have proved overloaded and flawed. This has not been done under three Ministers of Justice; instead, the Ministry continues to consult the NACP on these documents, allowing the Agency, despite its inherent conflict of interest, to significantly influence their content. 

The current version does not include an assessment of the NACP’s new mandate in the field of lobbying, and the mathematical threshold for determining inefficiency sufficient to dismiss the Head is excessively demanding and unrealistic. The methodology and criteria also fail to account for the individual inefficiency or misconduct of the Agency’s Head. Therefore, it would be reasonable for the Assessment Commission, rather than the government, to approve the new documents, similar to the approach provided in the Law on the National Anti-Corruption Bureau of Ukraine.

Amendments proposed in the draft law

Draft Law No. 14209 proposes supplementing Article 14 of the Law on Corruption Prevention, which regulates oversight of the NACP, with a provision requiring the Cabinet of Ministers of Ukraine to adopt a decision to initiate formation of the Assessment Commission no later than thirty calendar days before the expiry of two years from the date of approval of the Agency’s most recent external independent assessment report. 

The draft law also proposes that, within one month of its composition being approved, the Assessment Commission must adopt and publish the criteria and methodology for evaluating the effectiveness of the National Agency, based on its statutory mandate. This includes adopting criteria for determining when the Head of the NACP has improperly performed their duties and criteria for assessing the overall effectiveness of the National Agency. 

The draft law further proposes adding improper performance of duties by the Head of the Agency as a ground for early dismissal under Article 5(5) of the Law, which sets out the conditions for terminating the Head’s powers.

Conclusions

Transparency International Ukraine fully supports the adoption of Draft Law No. 14209, which will finally establish an effective mechanism of external oversight over the NACP’s work, eliminate abuses related to delaying the audit, and ensure real accountability of the Agency’s leadership for inefficiency or improper performance of duties. 

Introducing updated, objective, and independently approved assessment criteria is a key condition for strengthening trust in Ukraine’s anti-corruption system and improving its effectiveness, especially against the backdrop of recent corruption scandals.

At the same time, despite our support for the proposed amendments, it appears paradoxical that launching the mechanism of external oversight of the NACP — already explicitly provided for in current legislation — requires additional legislative intervention to ensure its actual functioning. 

Proposed amendments

The government proposes to define that cases on recognizing assets as unjustified and recovering them to the state will be considered by a HACC judge either single-handedly or by a panel of three judges, depending on the case’s complexity.

Cases concerning the application of the sanction provided for in Article 4(1)(1-1) of the Law of Ukraine on Sanctions would be heard within 30 days from the date of the statement of claim’s receipt, without specifying that these cases must be considered by a panel.

The final and transitional provisions of the draft law stipulate that the previous rules on collegial consideration will continue to apply to cases:

• on recognizing assets as unjustified and recovering them to the state, where proceedings were opened before the Law enters into force;
• on applying the sanction provided for in Article 4(1)(1-1) of the Law of Ukraine on Sanctions, where proceedings were opened before the law entered into force.

Areas for improvement

The draft law indeed introduces relevant and timely amendments that may enhance the efficiency of both civil confiscation and sanction proceedings at the HACC. Moreover, in our latest HACC monitoring report, we called on Parliament to introduce a single-judge trial mechanism for civil confiscation cases.

Regarding civil confiscation cases, the provision defining how a HACC judge will decide whether a case is to be considered single-handedly or by a panel needs further clarification.

The mechanism of “expanding” the composition of the court due to case complexity is not new to procedural legislation. Both administrative and commercial procedures already allow a case that is normally heard by a single judge to be considered by a panel either on the court’s initiative or at the request of a party. In these examples, the stage at which such a decision may be taken is clearly defined — before the preparatory hearing ends or before the trial begins if no preparatory hearing is held. The court issues a separate ruling to formalize such a ruling.

The draft law does not specify at what stage, on whose initiative (solely the court’s or also the parties’), and in what form this decision is to be made. It is also essential to set clear criteria of complexity that the court may apply when initiating a collegial trial. This would also help judges better substantiate their decisions on forming a panel, as it would provide a structured basis for their reasoning.

These aspects need to be refined to eliminate the risk of future appeals claiming that the case was not heard by a “court established by law.” For example, the defendant’s official position could serve as one criterion for determining whether the case should be tried by a single judge or a panel.

International institutions have repeatedly emphasized the need to establish clear rules and criteria for forming a court composition in each case. The draft law’s proposal essentially introduces exceptions to the general rules of case assignment based on case complexity. The Venice Commission has previously noted that the allocation of cases among judges should be based on objective and transparent criteria established in advance by law or special rules adopted under the law, such as court regulations. The Commission also stressed that exceptions to these criteria must be justified.

Similarly, the Council of Europe’s Committee of Ministers’ Recommendations on the independence of judges state that a case should not be withdrawn from a particular judge without valid reasons. Any such withdrawal must be based on objective, pre-established criteria and follow a transparent procedure within the judiciary. Although these findings concern the assignment and withdrawal of cases, they can also apply to the procedure of “expanding” the composition of the court, as it equally involves a change in the judicial panel.

The introduction of a single-judge trial in sanction confiscation cases is also justified by the need to reduce the workload of HACC judges. However, it would be appropriate to accompany this change with longer procedural time limits for filing appeals, since appeals are considered by a panel of the HACC Appeals Chamber.

Currently, parties and their representatives may file an appeal against a HACC decision within five days from the date of its pronouncement. If only the introductory and operative parts of the judgment were announced in court, the time limit starts from the date the full text is completed and published on the official HACC website. An identical five-day time limit applies under the Administrative Procedure Code for submitting a reply to a statement of claim.

Transparency International Ukraine has long stressed the need to extend procedural time limits in sanction cases, including the period for submitting a statement of defense and appeals against first-instance decisions. Procedural rights in sanction proceedings concern not only sanctioned persons but also the Ministry of Justice, which may also appeal first-instance decisions, and third parties — often Ukrainian companies and citizens not subject to sanctions.

We propose extending both the reply and appeal deadlines to 15 days, in line with Administrative Procedure Code standards. This should take into account the extraordinary nature of the confiscation mechanism and its application exclusively during martial law. The current method of calculating these time limits does not require amendment.

Conclusions

Transparency International Ukraine recommends adopting Draft Law No. 14033 only after revisions aimed at:

• specifying the criteria for determining the complexity of civil confiscation cases to be considered by a HACC panel; defining the stage, initiative, and form for such a decision;
• extending procedural time limits for filing an appeal and a reply to the statement of claim to 15 days from the date of pronouncement or publication of the judgment and from the date of receipt of the statement of claim, respectively.

Key risks of the draft law before the second reading

Most of our conclusions regarding the problems of the draft law in its initial version remain valid. However, the second reading has introduced new risks as well, which we describe in detail below.

 

1. Actions taken in accordance with official positions of state authorities as grounds for excluding criminal liability

The authors of the amendments propose that actions of an individual should not be considered a criminal offense if they were taken on the basis of clarifications issued by central executive authorities regarding the application of tax, customs, or public procurement legislation.

This provision entails serious corruption risks, in particular:

• There is no established procedure for verifying the legality of such clarifications or for appealing them. It remains unclear what should happen if a clarification were issued ultra vires or in contradiction to existing legislation.
• The concept of “actions taken on the basis of clarifications” is not clearly defined. In practice, business entities engage in ordinary economic activities rather than “executing” clarifications of state bodies, which means offenses could be disguised as compliance with such clarifications.

Above all, this provision contradicts the very essence of anti-corruption efforts, which invariably concern the unlawful nexus between power and those who exploit it for personal gain. Under the proposed norms, individuals with sufficient influence could obtain favorable clarifications from central executive authorities for their own benefit and thereby avoid liability for violations.

It is particularly striking that this provision would cover clarifications of customs legislation—an area that, according to business surveys, has consistently ranked as the most corruption-prone for four consecutive years. It therefore appears that MPs, in a draft law ostensibly aimed at protecting business interests, have failed to take this aspect into account.

It should be noted that similar provisions already exist in tax law. For example, a person cannot be charged interest if they acted in accordance with a tax consultation or a Supreme Court decision. However, the Tax Code contains critical safeguards: individual tax consultations can shield from financial liability only if they are officially registered in a special state database. Moreover, if an individual consultation contradicts a general one, the latter prevails as it has superior legal force.

The new draft law would extend grounds for excluding criminal liability under the Criminal Code beyond taxation to also cover customs and public procurement legislation.

In seeking to enhance business protection by inserting new provisions into the Criminal Code, the committee overlooked that clarifications of legislation cannot substitute the law itself. The absence of sufficient clarity and precision in legislation undermines protection against arbitrary interference by public authorities in property rights, as underscored by the ECtHR in Shchokin v. Ukraine. In this way, the authorities attempt to “pull the wool over the eyes” of business, absolving themselves of responsibility for legislative quality while creating additional corruption risks.

Furthermore, clarifications issued by state bodies may be vague and merely repeat statutory provisions, opening the door to ambiguous interpretations and complicating the determination of whether a business was acting lawfully.

It is also important to recall that Article 41 of the Criminal Code sets clear criteria for the legality of orders: they must be issued by a duly authorized person, in due form, within their competence, and must not contradict legislation or violate constitutional rights of individuals or legal entities. Moreover, an authorized person bears liability for carrying out a “manifestly criminal” order, thus creating an additional safeguard against abuse.

By contrast, the proposed new Article 41-1 contains no criteria for assessing the legality of clarifications but instead grants immunity for any actions “based on clarifications,” even if those clarifications contradict the law or are manifestly unlawful. This would create far greater opportunities for abuse. We therefore recommend removing these provisions from the draft law.

The proposed new Article 41-1 contains no criteria for assessing the legality of clarifications but instead grants immunity for any actions “based on clarifications,” even where such clarifications contradict the law or are manifestly unlawful, thereby creating far broader opportunities for abuse.

2. Premature disclosure of investigative secrets

The draft law proposes allowing appeals to an investigating judge against decisions of investigators to deny access to case materials, access to which at that stage could compromise the investigation.

In our view, such a provision risks breaching investigative secrecy and undermining the course of the investigation.

This danger is especially acute given that the prosecution would be obliged to disclose in court the content of materials to which access was denied and explain how such access could jeopardize the pre-trial investigation. This would inevitably harm the case, particularly in light of Article 306(3) of the Criminal Procedure Code, which requires that complaints against decisions, actions, or omissions during pre-trial investigation be considered in the mandatory presence of the complainant or their counsel or representative. Exercising this right would give these individuals direct access to the content of materials regardless of the investigating judge’s ruling on the complaint.

It is true that EU directives recognize the right to access case materials substantiating an arrest or detention. However, they also allow refusals where access could pose a serious risk to the life or fundamental rights of another person, or where refusal is strictly necessary to protect important public interests, including the integrity of an ongoing investigation.

In this context, it should be noted that under Draft Law No. 12439, appeals could also be lodged by representatives of persons subject to searches or whose property was seized.

EU implementation reports also show that some Member States do not provide for judicial review at the police investigation stage. In such cases, decisions are reviewed by a prosecutor or a higher-level prosecutor.

Accordingly, the proposed provision would impose excessive openness on investigative bodies and endanger investigative secrecy. The scope of persons entitled to request access should therefore be limited, and refusals to grant such access should be reviewed by a higher-level prosecutor.

The provision proposed by MPs would require excessive openness on the part of pre-trial investigation bodies, potentially compromising investigative secrecy. It is therefore necessary to limit the circle of persons entitled to request access to the materials.

3. Urgent searches will become practically impossible in corruption investigations

MPs propose narrowing the list of criminal offenses for which urgent searches may be conducted—an approach they had already pursued in the controversial Draft Law No. 12414. The narrowed list includes only one corruption-related offense: Article 368 of the Criminal Code (passive bribery).

Yet the need for urgent searches arises in other corruption-related offenses as well, for example, under Article 369-2 of the Criminal Code (trading in influence). Consider a scenario where a bribe recipient immediately seeks to exchange the funds at a currency exchange office: without the ability to conduct an urgent search of that office without prior judicial authorization, investigators would be unable to complete the evidence-gathering process.

We therefore recommend expanding the list of criminal offenses permitting urgent searches to cover other corruption-related offenses.

MPs propose narrowing the list of criminal offenses for which urgent searches may be conducted—an approach they had already pursued in the controversial Draft Law No. 12414.

Conclusions

TI Ukraine recommends that Parliament reject Draft Law No. 12439 in the version endorsed by the Verkhovna Rada Law Enforcement Committee on August 27, 2025. It is regrettable that, under the guise of protecting business, MPs are in fact hindering investigations into corruption offenses—the very offenses that often underpin and trigger such pressure on business.

Undoubtedly, business requires prompt safeguards against harassment through unfounded criminal proceedings. However, the chosen path of reform will cause more harm than good. Law enforcement officials who exert unlawful pressure on business are not following the law, they are violating it. Yet the proposed provisions of this draft law would obstruct the investigation of such abuses.

To ensure that Draft Law No. 12439 responds appropriately to existing challenges, we propose: 

• Not amending the Criminal Code to broaden the list of circumstances excluding criminal liability
• Limiting the circle of persons entitled to demand access to pre-trial investigation materials, and providing that refusals to grant such access be reviewed by a higher-level prosecutor
• Expanding the list of criminal offenses permitting urgent searches to include corruption-related offenses 
• Taking into account other proposals for improving the draft law that TI Ukraine had already put forward prior to the first reading.

Separately, we call on the President of Ukraine to sign the law adopted back in January 2025  on amendments to certain laws of Ukraine aimed at strengthening guarantees for the activities of media, journalists, and citizens’ access to information (Draft Law No. 11321). Had this law been in force, civil society organizations would have been able to attend committee sessions and oversee what MPs decide behind closed doors.

Key changes

The negligent form of guilt for violating or circumventing sanctions was removed from the draft law. This change deviates from the new European standard, since the EU Directive demands the criminalization of trade, import, export, sale, purchase, transfer, transition, or transportation of sanctioned goods, as well as the provision of services connected with goods under sanctions even if these actions were taken due to negligence at least in cases when these goods are for military purposes or dual-use.

This provision is important to implement at least due to considerations of the current martial law so that violators cannot avoid liability by claiming they were unaware of the imposed sanctions. Currently, the negligent form of fault can only be returned to the draft law by accepting amendment No. 209-2, which applies to officials of a financial institution. This is justified since the note to the Directive states that “professionals, such as in legal, financial and trade services, should exercise due diligence to prevent any violation of Union restrictive measures.”

The removal of property confiscation from the list of possible punitive measures for violation or circumvention of sanctions is also quite a negative development. In addition to this sanction being in line with the provisions of the Directive, confiscation would enable the use of Russian assets for the benefit of Ukraine. Therefore, this provision should be returned to the draft law in the second reading by accepting amendment No. 34.

Among other changes that are negative but not critical is the increased total cost of the subject of violation as a threshold for criminal liability from 100 to 300 non-taxable minimum incomes (UAH 454,200). In the Criminal Code of Ukraine, this amount is commonly found for the qualification of crimes committed in relation to the subject in a large or significant amount.

The total value of blocked assets that a person must acquire in order for it to be considered a circumvention of sanctions has also been increased from 50 subsistence minimums for able-bodied persons as of January 1 of the reporting year to 150 (UAH 454,200). This change is also not critical, although it deviates from the general standard of the Criminal Code of Ukraine, too.

For the purpose of qualifying the severity of the crime, assets will be considered “large” if they exceed the non-taxable minimum income of citizens by three thousand or more times (UAH 4.54 million) The previous version provided for a smaller amount — UAH 1.5 million. The situation here is similar in the context that most Criminal Code articles typically qualify this as an “especially large amount” of the subject of violation. However, MPs removed the definition of an “especially large amount” of the violation subject from the updated version of the draft law.

Also removed was the provision on the violation or circumvention of sanctions by individuals who hold responsible or particularly responsible positions. This provision is not specified in the Directive; it is, however, typical of the Ukrainian criminal law. However, the change is not critical.

Contracts for the provision of legal assistance to sanctioned persons will not be subject to restrictions; however, the procedure for payment under such contracts must be determined by the Cabinet of Ministers. This exception is precisely in line with European practice, as the right to protection is a basic human right.

In addition to the above changes, during the finalization, MPs did not strengthen the draft law by including other provisions of the Directive. In particular, the mechanism for granting temporary licenses to perform actions (deeds, operations, transactions) with sanctioned assets was not included. In the EU, this practice was introduced to respect fundamental human rights as well as to fulfill financial obligations. Licensing implies that the authorized body will grant temporary permission to a person or company to use a frozen asset, for example, when it comes to funds to cover basic needs, court fees and payments, fulfillment of contractual obligations, etc.

This mechanism would primarily help to keep Ukrainian enterprises financially attractive, since such companies may suffer significant losses due to the applied sanctions. As a result, after the confiscation of these companies by the State Property Fund, it will be more difficult to sell them.

Conclusions

Evidently, while preparing for the second reading, members of the Ukrainian Parliament did not use the opportunity to further harmonize the draft law with the European standards but actually deviated from them more. 

To fix this, when voting for draft law No. 12406 in the Parliament, the MPs should take into account the following recommendations:

• in addition to the intentional commission of a crime, also provide for negligence in case of a violation or failure to comply with a sanction by officials and financial institutions (amendment No. 209-2 to the draft law);
• in addition to the main punishment in the form of imprisonment and a fine, also provide for the confiscation of violators’ property as an optional form of punishment (amendment No. 34 to the draft law)
• support the draft law in the second reading taking into account the indicated amendments.

The introduction of criminal liability for circumvention and violation of sanctions is a critical necessity for Ukraine’s continued struggle against the Russian footprint in our economy and beyond. Therefore, we urge the Parliament to support the draft law in the second reading taking into account the indicated amendments.