Weekly analytics of the CPLR for 26 January – 1 February 2021

The G7 ambassadors recommended to the Ukrainian authorities priority measures in the area of judicial reform

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Event

On January 25, the G7 ambassadors presented a plan for judicial and anti-corruption reforms in Ukraine, developed at the request of President V. Zelensky. In terms of judicial reform, the plan proposed by the ambassadors contains 10 areas and relates to:

1.  The Constitutional Court (hereinafter – the CCU), for which it is proposed to temporarily increase the quorum for decision-making and change the procedure for selecting judges of the CCU, ensuring a significant role of representatives of international partners in the examination of candidates. Until the selection procedure is changed, it is recommended to temporarily postpone the ongoing selection procedures for CCU judges. It is also recommended to strengthen disciplinary responsibility and ethical requirements for CCU judges and to oblige CCU judges to hold open voting;
2.  The High Council of Justice (hereinafter – HCJ), for which it is proposed to establish an independent ethics commission, which will inspect the current members of the council, with the possibility to initiate their dismissal before the subjects of appointment. In the future, this commission will assess the integrity of HCJ candidates and form a list of recommended candidates from which the appointing entities will choose. HCJ reform is seen by the ambassadors as a “necessary precondition for effective judicial reform”;

3.  The High Qualification Commission of Judges (hereinafter – HQCJ), the new members of which must be selected by an independent competition commission with the participation of international experts. The HQCJ formed in this way should remain independent, and after ensuring the integrity of HCJ members and filling vacant judicial positions, it should be integrated into the HCJ;
4.  Judicial reform strategy, which should be developed with the involvement of all stakeholders and comply with international standards and the National Anti-Corruption Strategy for 2020-2024;
5.  Selection of judges and qualification assessment, within which clear, publicly available and transparent rules and procedures should be established;
6.  Public Council of Integrity, which powers should be expanded and which should be provided with state funding and resources for work. It is also recommended to strengthen the requirements for board members;
7.  The Supreme Court, which is to be merged with the Supreme Court of Ukraine. The existing structure of the court should be reviewed by creating a single court with specialized chambers. Additional filters should also be introduced to limit its jurisdiction;
8.  Disciplinary liability of judges, which should establish clear rules, standards and procedures for the investigation and handling of complaints of misconduct by judges;
9.  Administrative Justice. Within this area, it is proposed to review the jurisdiction of administrative cases on lawsuits against government agencies in accordance with the obligations to the International Monetary Fund (hereinafter – the IMF). Two ways of reform have been proposed – either by referring certain categories of cases to the jurisdiction of the Supreme Court, or by creating a new specialized court with a competitive selection of judges with the participation of international experts;
10.  The State Judicial Administration in which the audit must be conducted. Also, the judicial administration should be reorganized under the control of the HCJ.

On the same day, the Parliamentary Assembly of the Council of Europe, following the results of its monitoring in 2020, adopted a resolution No. 2357 (2021), which noted the persistent shortcomings in the reform of the judiciary and the justice system in Ukraine and recommended that Ukraine refrain from any actions, which may have long-term negative impact on the rule of law and the independence of the judiciary.

The next day, Ukraine responded to the statement of the G7 ambassadors. Thus, the HCJ addressed the government and the Ministry of Foreign Affairs with a request to inform whether the ambassadors had officially sent the proposed list of measures. Deputy Head of the Office of the President A. Smyrnov informed that he had known about such recommendations since November, but he personally advocated their broad professional discussion within the Commission on Legal Reform. He noted that: “advice should be treated as advice. Without deadlines for their implementation and without coercion, but with a tangible level of professional dialogue at the level of the judiciary and anti-corruption bodies”.

On January 29, the European Commission President Ursula von der Leyen said that she had talked to President Zelensky about the importance of judicial reform. In its report on this conversation, the Office of the President shifted the emphasis to other issues.

CPLR assessment

The CPLR experts support the priority actions proposed by the G7 ambassadors in the field of judicial reform, as their implementation will indeed have a positive impact on the implementation of integrity principles in the judiciary, overcoming the circular guarantee and protectionism.

This is not the first time that the need for judicial reform in Ukraine has been the subject of attention by the international community.  Implementation of judicial reform, primarily the reset of the HCJ selection procedure and the assessment of the integrity of the current Council is the cornerstone of Ukraine’s agreements with the IMF and the European Union in 2020 (see more details in weekly analyzes for June 8-15, July 20-27, August 25 – September 1-st, September 15-21, November 17-23 2020), as well as in the recommendations of the Venice Commission. In the context of the agreements reached, the reaction of the President’s Office to the statement of the G7 ambassadors on the need for a broad discussion of the proposed measures looks like an attempt to delay the implementation of commitments (on the HCJ reform, creation of an independent HQJC, change of jurisdiction for the cases involving national authorities).

International partners share a vision of the problems of the Ukrainian judiciary and ways to overcome them. At the same time, the delay in carrying out reforms by the Ukrainian authorities indicates a lack of political will for a qualitative reset of the judicial governance authorities. In modern conditions, such behavior is particularly dangerous, given that back in November 2020, G7 ambassadors stressed that the implementation of judicial reform is a key factor in Ukraine’s transition to a new level of European integration.

People's deputies want to give the unreformed HCJ full control over the formation of a new HQCJ

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Event

On January 29, a revised draft law No.3711-d  “On Amendments to the Law of Ukraine“ On the Judiciary and the Status of Judges” and some laws of Ukraine on resumption of the work of the High Qualification Commission of Judges of Ukraine” was submitted to the Parliament. The draft law envisages significant changes to the procedure of selection of members of the High Qualification Commission of Judges (hereinafter – HQJC) previously proposed by President V. Zelensky, in particular:

●  The HQJC will consist of 16 members, 8 of whom are to be appointed from among acting/retired judges;
●  The competitive selection will be held in two stages. At the first stage, the Competition Commission on Integrity will select candidates according to the criterion of integrity and will recommend at least two candidates for one vacant position of a member of HQCJ. In the second stage, the HCJ will assess the candidates on the basis of their professional competence and determine the winners of the competition;
●  The Competition Commission should include 3 persons from among judges/retired judges proposed by the Council of Judges of Ukraine and 3 persons proposed by the Council of Prosecutors of Ukraine, the Council of Advocates of Ukraine, the National Academy of Legal Sciences of Ukraine represented by the Presidium. In the first competitive selection to the HQCJ, international experts will take part instead of members of the Competition Commission according to the quota of lawyers, prosecutors and scientists. The members of the Competition Commission will be appointed by the HCJ, and their activities will be supported by the staff of the Council Secretariat;
●   The regulations on the competitive selection procedure, the methodology for assessing the integrity of candidates will be approved by the HCJ based on the proposal of the Competition Commission.

In addition, the authors of the draft law propose to give the HCJ the power to determine the number of judges in the courts, including in the Supreme Court, and to restore the right of the HQCJ to independently approve documents relating to its activities.

CPLR assessment

The powers of the previous HQCJ were prematurely terminated by the Presidential Law No.193-ІХ in November 2019. The new composition of the HQCJ was to be formed by a specially created competition commission with the decisive participation of international experts. However, as a result of the HCJ’s attempt to establish control over the course and results of such a competitive selection, the competition commission did not start work (see more details in the weekly analyzes of January 13-20, January 20-27, February 4-10 2020). Although the CCU declared some of the provisions of this law unconstitutional, no remarks were made regarding the change in the method of forming the HQCJ. At the same time, the failure of the HCJ to establish a competition commission necessitated legislative changes to unblock the competition for the HQCJ.

At the end of June 2020, President V. Zelensky introduced the draft law No. 3711, which was supposed to restart the competition to the HQCJ. The draft law repeated previous mistakes and retained the significant influence of the HCJ in the competition for HQCJ. In the first reading, the voting for this draft law failed, therefore it was sent for a second reading.

The revised draft law No. 3711-d, which the relevant parliamentary committee recommends for adoption in the first reading, not only does not take into account previous mistakes, but on the contrary proposes to put the competitive selection of new members of the HQJC under full control of the HCJ, which will form composition of the competition commission, approve its rules of procedure,  approve the methodology according to which the members of the commission will evaluate the participants of the competition, as well as assess the competence of the candidates, which will influence the final selection of winners. In addition, it is the HCJ staff members who will support the work of the commission. It is also important to note that the draft law does not provide for any decisive role of international experts in the first competition for the HQCJ.

In such a way, the parliamentary committee created all the conditions for the formation of the HCJ-controlled first composition of the HQCJ. Given that problems with the integrity of HCJ members are the subject of attention at the international level (in particular, by the International Monetary Fund, the European Union, the Venice Commission, G7 ambassadors), and Ukraine undertakes to check the integrity of the current HCJ members, giving HCJ additional powers to solve problems with the integrity of its members is unacceptable.

In view of the above, it is expedient to reject the draft law with its subsequent substantial revision in order to ensure full independence of the competition commission and the actual results of the competitive procedure from the HCJ.

Judges of the High Anti-Corruption Court accused the HCJ of interfering in their activities

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Event

On January 27, the meeting of judges of the High Anti-Corruption Court (HACC) approved a statement on guarantees of HACC independence, stating that “HCJ practice in disciplinary proceedings against HACC judges in some cases… may carry the risk of undermining the independence of the court.” Examples are the disciplinary actions against HACC judges for their legal position in high-profile cases, the unlawful solicitation of copies of materials of pending court cases, and the tolerance of discrediting HACC judges during a public event by the HCJ Deputy Chairman.

On 29 January, the HCJ’s official website published a rebuttal to the allegation of a biased approach to the handling of complaints against HACC judges, citing statistics on the results of complaints received, stating that the HCJ had found two thirds of the total number of complaints against HACC judges unfounded. At the same time, the HCJ called the statement of the HACC judges’ meeting manipulative and aimed at discrediting the constitutional body.

CPLR assessment

In a weekly analysis of January 11-18, the CPLR experts reported an increase in attempts to influence HACC judges, including by the HCJ. The statement approved by the meeting of HACC judges is a confirmation that they feel the pressure of the HCJ. Such a statement is largely a positive signal that HACC judges will not tolerate interference in their activities by other entities, including the most influential entity in the judiciary, the HCJ, which takes personnel decisions regarding judges, including on their dismissal.

As for the rebuttal published on the HCJ website, it is unclear from the content whether it is the position of the council itself or the position of the press service, as the relevant decision was not published on the HCJ website and the issue of the HACC was not on the agenda.

The Verkhovna Rada adopted the new Law on the Security Service of Ukraine as a basis. It needs significant refinement

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Event

On January 28, the Verkhovna Rada adopted in the first reading the  draft law No. 3196-d of October 26, 2020 “On Amendments to the Law of Ukraine “On the Security Service of Ukraine” on the improvement of the organizational and legal framework of the Security Service of Ukraine.”

The draft law was developed pursuant to Clause 6 of Section VI of the Final and Transitional Provisions of the Law “On National Security of Ukraine” No. 2469-VIII, under which the Security Service is obliged to develop a draft law on amendments to the Law “On the Security Service of Ukraine” within six months and present it to the President of Ukraine for submission to the Verkhovna Rada in accordance with the established procedure. Despite the fact that this Law came into force in 2018, only now the Verkhovna Rada has made a progress on this issue.

Conceptually, it is a transition from a specialized body with broad tasks and powers to a classic counterintelligence body that meets European standards of intelligence services, set out primarily in the PACE recommendations NoNo 1402 (1999), 1466 (2005) and 1713 (2005).

CPLR assessment

The draft law proposes amendments to the laws “On the Security Service of Ukraine” and “On the General Structure and Staff Number of the Security Service of Ukraine”, which currently regulate the activities of the Security Service of Ukraine. Although in fact it is referred to as a new version, which is inappropriate from the point of view of normative design techniques, because there must be a new law

The following positive aspects of the draft law should be highlighted:

–   the transfer of the investigative function to the State Bureau of Investigation will take place gradually (by 2024), but until then the SSU will continue to conduct pre-trial investigation of criminal offenses that threaten state security (it is advisable to immediately remove from the functions “pre-trial investigation of criminal offenses that pose a threat to state security”, because it is a temporary function);
–   a distinction is made between operative-search and counter-intelligence activities (the latter is excluded as a basis for carrying out operative-search activities);
–   multilevel mechanisms of preventive response to threats to state security are offered: proposals, official warning, submission to the SSU;
–   preconditions are created for the liquidation of special units of the Security Service of Ukraine to combat corruption and organized crime (although the possibility to combat organized and transnational crime is provided from the standpoint of combating intelligence and subversive activities to the detriment of Ukraine);
–    a gradual reduction of the SSU staff is envisaged – 25, 20, 17 thousand – annually for 3 years (currently there are 31 thousand employees in the service, taking into account the special period);
–    partial demilitarization of the SSU is planned: from January 1, 2022, the military ranks of SSU officers will be replaced by special ones (their distinction is not clear enough and needs to be improved);
–    possibility to appoint a “civilian” Chairman of the SSU: experience in the service is not required (professionalism is balanced by the requirement for deputies to have experience in the SSU for at least 5 years).

On the other hand, the negative aspects of the draft law are the following:

–    the status of the SSU as a pre-trial investigation body is actually maintained (see paragraph 4 of Article 4 of the draft law), although this body is directly subordinated to the President of Ukraine and not to the Cabinet of Ministers of Ukraine (executive power), which threatens its independence and leads to unconstitutional concentration of executive power with the President of Ukraine, as emphasized by the Constitutional Court of Ukraine in its Opinion of December 16, 2019 № 7-v/ 2019;
–    The same applies to the unconstitutionality of the personnel powers of the President of Ukraine to approve the appointment/ dismissal of the First Deputy and Deputy Chairmen of the SSU and heads of regional bodies of the SSU;
–   Although partial demilitarization of the SSU is envisaged, the SSU officers, even those who lose the status of servicemen, retain all military benefits and even additional benefits appear, in particular: provision of medical insurance, which includes sanatorium treatment; 50 percent discount on housing bills and utility bills. Demilitarization of this body should entail deprivation of such benefits;
–   unconstitutional procedure for approval of the Disciplinary Statute of the SSU by a “regulatory legal act of the SSU”, because it contradicts paragraph 22 of Part 1 of Art. 92 of the Constitution of Ukraine, which stipulates that it must be approved by law;
–   SSU loses powers in the field of counteraction to economic crimes. At the same time, the SSU will have the right to conduct counterintelligence support in the context of economic potential, i.e. the function of economic counterintelligence is narrowing towards its intended purpose;
–   too wide access of the SSU to information without proper control: the SSU is provided direct access to information resources and copies of information funds in order to prevent violations of the rights and freedoms guaranteed by the Constitution of Ukraine, as well as unauthorized access to confidential information about a person and illegal dissemination of such information. Although such powers are required for counterintelligence activities, given the scale of the interference with the right to privacy, they require judicial and administrative oversight.

In view of the above, we believe that the draft law needs significant refinement with the involvement of the authorities, Ukraine’s international partners and representatives of civil society and scientific institutions.

Parliament passed the Law on the body of financial investigations

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Event

On January 28, the Verkhovna Rada adopted the Law “On the Bureau of Economic Security of Ukraine” (draft No. 3087-d of July 2, 2020, hereinafter – the Law).

According to the explanatory note, the draft law was developed to eliminate the “tax police”, optimize the structure and number of bodies involved in combating crimes in the economic sphere, eliminate duplication of their functions and establish the Bureau of Economic Security to prevent, detect, stop, investigate and disclose criminal offenses referred by law to their jurisdiction. In other words, it is a question of formation of a new body of pre-judicial investigation.

The adopted Law proposes a model of the pre-trial investigation body that differs from the “tax police” model in a positive sense, but it also contains a number of provisions that threaten the independence and political neutrality of the body and effectively derail efforts to establish a best practice agency.

CPLR assessment

Regarding the status of the Bureau and the place in the system of authorities

The Bureau of Economic Security (hereinafter – the Bureau) received the status of a central executive body. Its activities will be directed and coordinated by the Cabinet of Ministers directly.

The State Bureau of Investigation had a similar status from the period of adoption of the relevant Law until the end of 2019 (as amended by Law No. 305-IX) and in itself such a status does not pose significant risks to the independence of the pre-trial investigation body.

At the same time, the activities of the Bureau, as already mentioned, will be directed and coordinated by the Cabinet of Ministers (unlike the SBI). In turn, an institutional conflict will inevitably arise over time between the Government’s financial and fiscal responsibilities and the Bureau’s mission as a pre-trial investigation body, which could lead to Government interference in the Bureau’s work.

Regarding the transfer of the SSU’s economic functions to the Bureau

The Law on the Bureau introduced some amendments to the Law “On the Security Service of Ukraine”, in particular as regards the structure of the service, but the Soviet model of counterintelligence and its broad function as a law enforcement agency remain unchanged, so the SSU will further hold its powers, which allow to intervene in the activities of enterprises.

Regarding the procedure for selection and appointment of the Director of the Bureau

The Director of the Bureau will be appointed by the Cabinet of Ministers on the proposal of the competition commission. The competition commission can nominate up to 3 candidates for the position of the Director of the Bureau. Discretionary powers regarding the final selection of the winner of the competition are left to the Cabinet of Ministers, without setting any guidelines for this process.

The competition commission consists of 9 people: the National Security and Defense Council, the Verkhovna Rada and the Cabinet of Ministers delegate 3 representatives each. The law, similarly to the Law on SBI, does not contain restrictions on the participation in the work of such a competition commission of persons authorized to perform the functions of state or local self-government. As evidenced by the experience of the competition commission for the selection of the director of the SBI, such rules for the formation of the competition commission create a high risk of politicization of the selection process of the director of the Bureau.

In addition, the Constitution does not empower either the National Security and Defense Council or the Verkhovna Rada to delegate representatives to the relevant competition commissions. In other words, the mentioned provisions of the Law are unconstitutional.

Regarding the staff number and procedure for selecting employees of the Bureau

The law stipulates that the maximum number of Bureau staff is 4,000. This is almost three times more than the number of SBI employees, and almost five times the number of NABU employees. At the same time, the authors of the draft law did not provide a justification for such a number of Bureaus, but rather simply started from the number of “tax police”.

The selection of employees of the Bureau will be carried out by competition commissions according to the procedure determined by the director of the Bureau. In this case, the composition of such competition commissions must include representatives appointed by the Public Control Council at the Bureau (up to three people). Also a prerequisite for the selection of employees of the Bureau is a psychophysiological survey using a polygraph.

It is noteworthy that the Law does not contain restrictions on the employment of persons who have recently worked in the State Fiscal Service (tax police), specially authorized economic protection units of the SSU or the National Police. Parliament also did not use the quota principle of forming the Bureau (following the example of the SBI): when the number of former employees of the relevant units that can serve in the Bureau is limited to a certain percentage level, which would ensure quality staff renewal.

Regarding the Public Control Council

The Public Control Council of the Bureau consists of 15 people and is formed on the basis of an open and transparent competition through online rating-based voting. Regulations on the Public Control Council at the Bureau and the procedure for its formation shall be approved by the Cabinet of Ministers.

However, as the experience of the Public Control Council at the SBI shows, the Cabinet of Ministers may approve unreasonably high requirements (for example, the need to have at least 10 years of experience) for candidates for members of the Public Control Council at the Bureau, which will significantly narrow the list of possible candidates to the Public Control Council.

Conclusion

Although the parliament’s efforts to establish a financial investigation body are a step forward, the legislative decisions mentioned here reduce the chances of a qualitatively different reformatting of this area rather than the other way around.

The risks mentioned in the text can be eliminated by:

–     establishing a system of monitoring (public and by the Office of the Prosecutor General) of attempts by the Cabinet of Ministers to interfere in the activities of the Bureau;
–     a complete revision of the SSU’s functionality as a counterintelligence body, as well as the abolition of all SSU powers inherent in law enforcement agencies;
–    removal of the National Security and Defense Council and the Verkhovna Rada from the list of subjects participating in the competition commission for the selection of the Director of the Bureau, transferring these powers to the Cabinet of Ministers;
–    establishment of legislative restrictions on the participation of persons authorized to perform the functions of the state or local self-government in the work of the competition commission for the selection of the director of the Bureau;-    establishment of a restrictive quota principle for employees of the State Fiscal Service (tax police), specially authorized units of economic protection of the SSU and the National Police in the formation of the staff of the Bureau;
–     financing the work of the Bureau only on the basis of a proper justification of the need for the maximum number of staff proposed by the Law.