CONFLICTS OF INTEREST AND INCOMPATIBILITIES IN EASTERN EUROPE ROMANIA, MOLDOVA, CROATIA Conflicts of interest and incompatibilities in Eastern Europe CONFLICTS OF INTEREST AND INCOMPATIBILITIES IN EASTERN EUROPE ROMANIA, CROATIA, MOLDOVA 1 Romania, Moldova, Croatia Authors Laura tefan, Expert Forum (EFOR), Romania Septimius Pârvu, Expert Forum (EFOR), Romania Munir Podumlijak, Partnership for Social Development, Croatia Cornelia Cozonac, Journalistic Investigations Center, Moldova © 2012 All the information contained within this publication is copyright of the authors and cannot be copied without quotation. You can also download this publication from www.expertforum.ro. 2 Conflicts of interest and incompatibilities in Eastern Europe Foreword ..................................................................................................................................................................... 4 A comparative view ................................................................................................................................................. 5 ROMANIA I. The formation and evolution of the anticorruption agenda ................................................................ 9 II. Legal framework ............................................................................................................................................... 13 III. Institutional setup ........................................................................................................................................... 16 The structure of the National Integrity Agency ......................................................................................... 18 Monitoring and control ...................................................................................................................................... 20 Legislative evolutions and setbacks ............................................................................................................... 22 Budget ....................................................................................................................................................................... 25 Institutional track-record.................................................................................................................................... 26 Collaboration between institutions ................................................................................................................ 28 IV.Conclusions ........................................................................................................................................................ 32 MOLDOVA I. The anticorruption agenda ............................................................................................................................ 35 II. Foreign Relations .............................................................................................................................................. 36 III. Conflicts of interests and incompatibilities ........................................................................................... 37 Conflicts of interests ............................................................................................................................................ 37 Incompatibilities .................................................................................................................................................... 42 IV. Enforcement Mechanisms ........................................................................................................................... 44 V. Impact ................................................................................................................................................................... 46 The reaction of civil society ............................................................................................................................... 48 Case studies............................................................................................................................................................. 49 Cases under investigation by the Anti-corruption Prosecutor’s Office ............................................ 52 CROATIA I. The anticorruption agenda - when did it start, who started it and why ....................................... 54 II. The importance of the EU influence (or of other stake-holders) in promoting the anticorruption agenda. Benchmarks / conditionality / access to funds ........................................... 58 III. Where do conflicts of interests and incompatibilities fit in the anticorruption agenda ...... 59 IV. Enforcement mechanisms ........................................................................................................................... 68 V. Case studies and impact of the legal and institutional framework on the prevention and suppression of conflicts of interest and corruption ................................................................................. 76 VI. Conclusions ....................................................................................................................................................... 87 3 Romania, Moldova, Croatia Foreword Conflicts of interest and incompatibilities constitute one of the most important challenges to the establishment of rule of law in South East Europe. Successfully tackling these phenomena is a key issue in the relationship between the countries in the region and the European Union. Romania has been an EU member state for six years, Croatia will be admitted in the very near future, and the Republic of Moldova is making progress towards closer ties with the European Union. Therefore, in Bucharest, Zagreb and Chisinau alike, legislation was adopted geared at fighting corruption and at ensuring the integrity of public officials. Yet there is still a gap between legal provisions and the implementation thereof. In this context strong and independent bodies that have the right and the duty to check public officials’ assets and possible incompatibilities are of extreme importance. Romania´s National Integrity Agency has served as an effective watchdog for several years and its work has been continuously praised in the progress reports of the European Commission under the Cooperation and Verification Mechanism. ANI can without any exaggeration be called a benchmark institution. In the Republic of Moldova the National Integrity Commission has been set up. So has the Conflict of Interest Commission in Croatia. These institutions are not and will never be “everybody´s darling” In fact they have and will have powerful enemies, also among certain segments of the political elites, who will try to limit the scope of the competencies and actions of these institutions. Therefore, a strong civil society that insists on transparency and accountability, that supports such institutions, is essential in ensuring the durable success of efforts to prevent conflicts of interests and incompatibilities. The present study represents an important contribution in this respect. The authors of each country study provide a realistic picture of the state of play in the fight against corruption in Romania, the Republic of Moldova and Croatia. They offer valuable insights into strengths and weaknesses of institutions and mechanisms employed to combat conflicts of interests and incompatibilities. I therefore sincerely hope that this study will find its way into the cabinets of politicians and experts and that the lessons provided herein will be translated into better policies and track records. Thorsten Geissler Director of the Rule of Law Program South East Europe Konrad Adenauer Stiftung 4 Conflicts of interest and incompatibilities in Eastern Europe A comparative view For many years corruption was not a topic for political action in Romania, Croatia and Moldova. Though opinion polls and international organizations were warning about the importance of this phenomenon, the illegal benefits obtained by people who found themselves in positions of power through corruption blocked for many years all initiatives to address the issue. Things started to change only when countries decided to move towards integration into the European Union thus accepting the standards in terms of rule of law. The first wave of reforms focused on building a comprehensive legal framework to cover the “traditional” forms of corruption – bribery, peddling in influence, abuse in office – and the institutional mechanisms able to enforce this legislation. Romania has set up the National Anticorruption Directorate, a model structure that included prosecutors, police officers and specialists and has investigated and brought to justice tens of parliamentarians, ministers and ex-ministers, mayors and other important public officials. Croatia has established USKOK, a prosecution structure in charge with organized crime and corruption, which is mirrored by a specialized police force and by specialized courts to hear these cases. Moldova has the Anticorruption Prosecutors' Office tasked with investigation of corruption offences. The clear option towards specialization of police officers, prosecutors and judges (only in Croatia) has shown results. Corruption investigations are quite laborious and use extensive work force and resources. As corruption is not an aim in itself, but rather a mechanism to obtain or cover other illegally obtained benefits, corruption investigations often include an organized crime or an