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Political Points for 16 – 23 April 2018


Political Points of the Centre of Policy and Legal Reform include a weekly expert analysis of the most important processes in Ukraine in areas of constitutionalism, political parties and elections, governance and public administration reform, judiciary, combatting corruption, criminal justice, etc. 

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Fighting for the influence on the financial crimes investigation authority

1. CPLR expert opinion

On April 18, the relevant parliamentary committee recommended that three draft laws aimed at the reform of the system of financial crimes investigation, registered during March-April 2018, should all be considered and taken as a basis:

1) main (registration number 8157 dated March 19, 2013; initiated by Nina Yuzhanina and others); “On the National Bureau of Financial Security” (NBFS);

2) alternative (registration number 8157-1 dated March 20, 2012; initiated by Andrii Zhurzhiy and others); “On the National Bureau of Financial Security”;

3) the second alternative (registration number 8157-2 dated April 03, 2018; initiated by Tetyana Ostrikova and others) “On the legal basis for the organization and activities of the Financial Police” (FinPolice).

All three draft laws envisage the creation of a new law enforcement body that should replace the tax police, which has been in semi-legal status for a year and a half due to non-systematic amendments to the legislation.

2. Respective authorities counter-point/argument 

In accordance with the requirements of the Memorandum with the IMF of February 27, 2015, Ukraine committed by the end of April 2017 “to approve by the Verkhovna Rada the legislation on the creation of a new civil service responsible for the investigation of financial crimes against the state under the control of the Ministry of Finance of Ukraine to replace the current tax police and consolidation all powers to combat financial crimes against the State in one agency, by avoiding duplication of functions.”

The relevant draft law was prepared for a long time by the Government.

However, on April 5, the President determined the draft law of Nina Yuzhanina as urgent.

3. CPLR assessment of the authorities counter-point 

The main draft law actually provides for the reorganization of the tax police. The draft law establishes an unjustified investigative procedure in the form of analytical notes that replace the investigation of a crime; excessive access to personal data; and the authority will actually be controlled by the President. In case of its adoption, the economic units of the Security Service of Ukraine will remain, as well as the Department for Economic Protection of the National Police.

An alternative draft law is a revised governmental option for the establishment of the Financial Investigations Service. Unlike the first one, it does not provide for excessive authority and does not interfere with the general mechanism of crime registration. In addition, it contains quotas for former employees of economic units of law enforcement agencies, and the procedure for its formation is independent of the President or other political actors.

The second alternative draft is the revised draft law “On the Financial Police” (Reg. No. 4228). It provides for the creation of an executive body, the activities of which are coordinated and directed by the Cabinet through the Ministry of Finance. The benefits of this draft law are that it provides for the involvement of professional international experts in the formation of this authority, as well as the liquidation of the economic units of the Security Service of Ukraine and the Department for Economic Protection of the National Police.

Its provisions are largely in line with the key provisions of the Memorandum with the IMF.

4.  CPLR expert suggestions on how to fix the problem using the legal instruments available in Ukraine.

One of the alternative draft laws should be taken as a basis and revised in accordance with the agreed remarks expressed by the expert environment. Currently, none of the draft laws can be considered a qualitative reform of the system of the investigation of crimes in the area of public finances.

International experts must have a decisive influence on the selection of candidates for the Anticorruption court

1. CPLR expert opinion

The relevant parliamentary committee prepares for the second reading а draft law “On the Supreme Anticorruption Court” initiated by the President of Ukraine. The presidential draft law proposes to involve international experts in the selection of judges of the Anticorruption court, but the role of international experts is nominal – they are “isolated” in a separate body, which can only negatively assess the integrity of individual candidates, while the key role is assigned to the current composition of the High Qualifications Commission of Judges (HQC).

However, during the selection process of the Supreme Court judges conducted by the HQC, the key issue was the manipulation by its members, which ensured the victory of far the best candidates, as well as the impossibility of verifying the fairness of the outcome.

In order to address the main problem that emerged during the competition to the Supreme Court, international experts should be involved in selecting the best, rather than dropping out the worst. If the HQC is trusted to perform this selection, then international experts should be included in this very structure, in order to minimize the space for manipulation, and hence the possibility of forming a pocket anti-corruption court.

In addition, according to the presidential draft law, the role of the cassation instance in cases of high-level corruption is left to the acting Supreme Court. This may lead to the Supreme Anticorruption Court turning out to be ineffective, as the Supreme Court judges under the control of the political authorities will be able to cancel the decision of the Supreme Anticorruption Court following their order. Therefore, it is necessary to create a separate autonomous Anti-corruption Chamber in the Supreme Court, whose judges should be selected according to the same procedures as the judges of the Supreme Anticorruption Court.

2. Respective authorities counter-point/argument 

The Chairman of The Verkhovna Rada of Ukraine Andriy Parubiy addressed the representative of the Venice Commission Thomas Markert with a proposal to involve experts of the Venice Commission in discussing the draft law “On the Supreme Anticorruption Court”.

One of the amendments to the second reading of the draft law proposes to provide for the possibility of candidates to appeal against the decision of the public council of international experts to the HQC. “And the qualification commission of judges has the right to re-direct (a candidacy) to the public council, which has to adopt the second decision, but by consensus … This means that all members of the public council should confirm the previous decision,” said the speaker. According to Parubiy, the secretary of the Venice Commission Thomas Markert approved this wording.

3. CPLR assessment of the authorities counter-point 

The CPLR welcomes the involvement of the Venice Commission experts in the process of drafting the relevant draft law, as it was a public proposal. However, we believe that the Ukrainian political authorities are trying to draw the attention of international structures away from the key issue of selection by limiting it to the discussion on which impact will have the decision of the “public council of international experts”.

However, even giving the international experts the right to veto individual candidates will not ensure the fair selection in the context of the non-transparent definition of the results of the competition by the current composition of the HQC, which compromised itself during the competition to the Supreme Court.

Secondly, the HQC will remain uncontrolled and will be able to place candidates in the ranking exactly as someone needs. The model proposed by the President and the Chairman of the Verkhovna Rada of Ukraine (a separate international body isolated from the selection process of the winners of the competition) does not correspond to the recommendations of the Venice Commission:

“Additional safeguards should be introduced to ensure that the decision-making body in the appointment procedure of judges is sufficiently independent of the executive and legislative powers. This could be achieved, for example, by giving a non-political agency such as the High Qualifications Commission of Judges (HQC) the right to nominate members to that body, in addition to the members proposed by international donors. Another option would be not to create an additional body such as the proposed Competition Commission but, as a temporary measure pending completion of the judicial evaluation, to include experts proposed by international donors as supernumerary members of the HQC to participate in the selection procedure for judges in the anti-corruption courts and to give them a crucial role in that procedure. The procedure for involving international organisations and donors in the selection procedure needs to be regulated more in detail so as to provide for a high degree of transparency and compliance with the Constitution”.

Secondly, it is more difficult for international experts to assess the past of the candidates in order to drop out the worst candidates than to evaluate their capabilities and identify the best candidates.

In addition, the Venice Commission proposed: “special rules for anti-corruption courts and judges (including their appointment and status) which deviate from the general LJSJ provisions should be limited to what is necessary for them to work effectively”.

This provision should be taken into account, by keeping the stages of selection as determined by the current law and the participation of the Public Council of Integrity, which can ensure the negative selection of candidates (rejected by the criterion of unreliability).

4. CPLR expert suggestions on how to fix the problem using the legal instruments available in Ukraine.

When finalizing the draft law, a special Commission for the selection of candidates for an anti-corruption court judge (possibly, within the HQC) should be established, where the majority of members (for example, 4 out of 7) will be international. This Commission should be empowered to select candidates, in particular, to conduct interviews with them and formulate the final rating of candidates. In other words, a special Commission should have the authority to select the best candidates, who, in case of confirmation by the High Council of Justice in accordance with the Constitution, will be appointed by the President of Ukraine to the position of a judge.

It is also important to create a separate autonomous Anticorruption Chamber in the Supreme Court, the judges of which will be elected according to the same procedures as the judges of the Supreme Anticorruption Court.

The above proposals are incorporated to the amendments to the draft law submitted to the committee by People’s Deputies.

Selection of judges of the Constitutional Court in the Parliament

1. CPLR expert opinion

The constitutional reform in the context of the “power triangle”, which was to be held back in September 2014, has been removed from the agenda for three years. Thus there is still an imbalance of power branches, there is no clear delimitation of the powers of key actors and the preconditions for institutional conflicts between the Parliament, the President and the Government still exist.

2. Respective authorities counter-point/argument 

On Friday, April 20, Andriy Parubiy made a statement, according to which “the most optimal for Ukraine are changes to the Constitution, which will be able to balance the relationships between the branches of power. As in fact there should be one branch of the executive power. ”

3. CPLR assessment of the authorities counter-point 

On April 20, an event devoted to constitutional reform under support of the Venice Commission, was held in Kyiv. The presentation of the Report on “Semi-Presidentialism and Inclusive Governance in Ukraine: Proposals for the Constitutional Reform” was held there.

During the period of independence of Ukraine, the constant fluctuations between the options of semi-presidentialism revolved around the balance of power between the President and the Prime Minister. There is a continuous conflict in the state about the role and responsibility of the President and the Prime Minister, which gives rise to calls for further constitutional reform.

There are four fundamental challenges for democratic constitutional governance in Ukraine:

1. A repeated institutional conflict between the President, the Parliament and the Government, which drove the political system into an angle and impedes effective parliamentarism;

2. Inclination of the institute of presidency to autocratic tendencies;

3. The fragmentary and weak system of political parties, which undermines the possibility of a coordinated work of the Parliament;

4. Low constitutional culture and weak Constitutional Court, manifested through politically motivated and unilateral changes to the Constitution.

These challenges set the context for any discussion on the functioning of the current Constitution or the possibility of future constitutional reforms. In response to these challenges, three basic principles were elaborated that should guide the constitutional design:

1. Protection from presidential autocracy;

2. Distribution of power and leadership of the executive branch;

3. Parliamentary control over the executive branch.

There are options for further limitation of the presidential power, even under the current parliamentary-presidential system, in which the presidential power is even weaker than in the presidential-parliamentary form of governance.

4. CPLR expert suggestions on how to fix the problem using the legal instruments available in Ukraine.

A constitutional reform in relation to the power triangle should be carried out by observing the constitutional procedure and taking into account the developments of the constitutionalists. It is necessary to limit the political influence in the process of drafting constitutional changes and avoid the implementation of a constitutional reform to serve unilateral political interests. Draft constitutional changes should be discussed with the public. In order to elaborate the constitutional changes, speculations and recommendations set out in the report of international and Ukrainian experts need to be considered (in Englishin Ukrainian).