Dealing with corruption in Central and Eastern Europe

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Published 30 September 2003, updated 28 May 2012

Summary

The EU has adopted the following legal instruments and measures to combat corruption:

Convention on the protection of the European Communities financial interests (entered into force on 17 October 2002);
Convention on the fight against corrup tion involving officials of the European Communities or officials of the EU Member States (not yet ratified);
European Anti-fraud Office (OLAF) was set up address corruption within EU institutions.

In its Communication on a comprehensive EU policy against corruption, released in May 2003, the European Commission proposed measures for preventing and combating corruption in Europe.

Issues

The Communication on a comprehensive EU policy against corruption proposes 10 principles for improving the fight against corruption in acceding, candidate and other third countries:

To ensure credibility, a clear stance against corruption is essential from leaders and decision-makers. Bearing in mind that no universally applicable recipes exist, national anti-corruption strategies or programmes, covering both preventive and repressive measures, should be drawn up and implemented. These strategies should be subject to broad consultation at all levels.
Current and future EU Members shall fully align with the EU law and ratify and implement all main international anti-corruption instruments they are party to (UN, Council of Europe and OECD Conventions). Third countries should sign and ratify as well as implement relevant international anti-corruption instruments .
Anti-corruption laws are important, but more important is their implementation by competent and visible anti-corruption bodies (i.e. well trained and specialised services such as anti-corruption prosecutors). Targeted investigative techniques, statistics and indicators should be developed. The role of law enforcement bodies should be strengthened concerning not only corruption but also fraud, tax offences and money laundering.
Access to public office must be open to every citizen. Recruitment and promotion should be regulated by objective and merit-based criteria. Salaries and social rights must be adequate. Civil servants should be required to disclose their assets. Sensitive posts should be subject to rotation.
Integrity, accountability and transparency in public administration (judiciary, police, customs, tax administration, health sector, public procurement) should be raised through employing quality management tools and auditing and monitoring standards, such as the Common Assessment Framework of EU Heads of Public Administrations and the Strasbourg Resolution. Increased transparency is important in view of developing confidence between the citizens and public administration.
Codes of conduct in the public sector should be established and monitored.
Clear rules should be established in both the public and private sector on whistle blowing (given that corruption is an offence without direct victims who could witness and report it) and reporting.
Public intolerance of corruption should be increased, through awareness raising campaigns in the media and training. The central message must be that corruption is not a tolerable phenomenon, but a criminal offence. Civil society has an important role to play in preventing and fighting the problem.
Clear and transparent rules on party financing, and external financial control of political parties , should be introduced to avoid covert links between politicians and (illicit) business interests. Political parties evidently have strong influence on decision-makers, but are often immune to anti-bribery laws.
Incentives should be developed for the private sector to refrain from corrupt practices such as codes of conduct or white lists for faultless companies.

Positions

The Commission made the following assessment of the candidate countries regarding corruption in its regular report in 2002:

Bulgaria</ td>	National Anti-Corruption Strategy was adopted in October 2001. Action Plan for Implementation of the Strategy was adopted in February 2002. A Committee was set up to co-ordinate activities in the fight against corruption. The challenge now will be to maintain the momentum to ensure full implementation of the programme. Bulgarias ranking in indexes of international perceptions has improved. However, the public still ranks corruption as one of the most serious problems facing the country. The high level of corruption is attributed to factors such as low salaries, imperfect legislation, lack of transparent administrative controls and poor functioning of the judicial system. Customs, occupations linked to the judicial system, tax officials, parliamentarians, police and ministry officials are perceived to be among the most corrupt groups. Corruption is also seen as having a negative effect on the business and investment climate and therefore on economic development. Whilst progress has been made in setting the framework for tackling corruption, practical steps have yet to be taken to fully enforce this.
Cyprus	Cyprus has a comprehensive legal framework against fraud and corruption. The Penal Code defines a series of offences of official corruption. The Prevention of Corruption Law sanctions both public and private corruption. The Public Service Law of 1990 contains special anti-corruption provisions and a corresponding code of conduct allows for compulsory retirement or dismissal after a disciplinary punishment. However, Cyprus still lacks a comprehensive anti-corruption policy, as is evidenced by the absence of any regulation on funding of political parties. Its law-enforcement mechanism does not use sufficiently proactive methods and its intelligence-gathering system has several pitfalls. OLAF's partner in Cyprus: Cyprus Ministry of Finance
Czech Republic	Corruption and economic crime remain a serious cause for concern. In April 2002 the Czech Government approved its own report on corruption which confirms that the situation is not improving. It noted that bribery in the public administration and fraud in the private sector continue to be significant problems. Corruption continues to affect the proper functioning of the state administration, the police, healthcare, banking, the judiciary and intelligence services and that it also influences the political sphere. Public opinion is increasingly concerned about corruption and economic crime.
Estonia	Corruption generally appears to remain a relatively limited problem. The Anti-Corruption Act in force since March 1999 forms the basis for the prevention and prosecution of corruption and includes a Code of Ethics for public officials. The new Penal Code, which entered into force in September 2002, brings Estonian legislation further into line with EU standards in the field of the fight against corruption. Whilst the legislative framework is mostly in place, Estonia does not have a specific strategy to fight corruption. However, specific bodies do have individual anti-corruption strategies. Also, the National Strategy for Crime Prevention 2000-2003 contains a number of anti-corruption objectives. OLAF's partners in Estonia: Estonian Customs Estonian Ministry of Finance
Hungary	Corruption continues to be a problem in Hungary. A long-term anti-corruption strategy was adopted in 2001. The revised Law on Public Procurement adopted in November 2001 tightened up the surveillance of contract award pro cedures. In December 2001 a new law was adopted concerning the liability of legal persons. Within the amended Penal Code, which entered into force in April 2002, more severe punishments and sentences for bribery were introduced. Despite these efforts, overall public perception of efforts to fight corruption has not really improved and many areas in the public sphere continue to have a bad reputation in this respect. OLAF's partner in Hungary: Hungarian Ministry of Finance
Latvia	Corruption remains a source of concern. The perceived level of corruption in Latvia continues to be relatively high, to the detriment of public trust in the public administration, the judiciary and private investors' confidence. Overall, Latvia has made further progress in the fight against corruption. The legislative framework has been improved, foreseeing the strengthening of the institutional set-up, and both public awareness and the involvement of civil society are on the increase. However, further efforts are needed to clarify and consolidate the institutional set-up and to provide the new Anti-Corruption Bureau with the necessary means to effectively ensure its independence. The Latvian Government should remain strongly committed to further combating high-level political corruption. OLAF's partner in Latvia: Latvia State Revenue Service
Lithuania	Corruption remains a source of concern, in particular in sectors such as customs, the police and the health system. There has been considerable further progress in the fight against corruption at both legislative and administrative level. However, further efforts should be made by law enforcement bodies and line ministries to ensure the proper implementation of the National Anti-Corruption Programme. Further efforts are also required to strengthen co-operation in practice between law enforcement bodies and with the Prosecutor's Office. Public procurement procedures need to be applied with greater rigour and consistency, ensuring full transparency. Given that the present institutional set-up gives priority to repressive measures, more attention should be paid to prevention. OLAF's partners in Lithuania: Lithuanian Special Investigation Service Lithuanian Customs
Malta	There have been positive developments over the past year, with the adoption of legislation strengthening fight against corruption and of a Regulation setting up an independent Public Contracts Appeals Board. Further alignment with the EU's public procurement law is still needed. There is no specific anti-corruption programme in Malta. No improvement has been noted in the effectiveness of the Permanent Commission against Corruption.
Poland	Corruption remains a source of serious concern. Corruption phenomenon in Poland threatens to undermine the functioning of many public spheres. There are still a large number of measures which could be taken to put in place a comprehensive approach to this problem. OLAF's partner in : Polish Ministry of Finance
Romania	Corruption remains a widespread and systemic problem in Romania that is largely unresolved. Despite a legal framework that is reasonably comprehensive law enforcement remains weak. New institutional structures have been created but are not yet fully operational. Corruption remains a common aspect of commercial ope rations but is also widely reported in dealings with public bodies as well as at the political level. Such high levels of corruption undermine economic development and erode popular trust in state institutions. There has been no noticeable reduction of corruption during the reporting period. No progress has been made in making the funding of political parties more transparent or in addressing potential conflicts of interest of politicians and civil servants. Corruption in Romania is all the more worrying because the institutions most involved in fighting corruption, including the police and the judiciary, are also affected by the phenomenon. OLAF's partner in Romania: Romanian Prime Minister's Control Department
Slovakia	Corruption remains cause for serious concern. Implementation of the National Programme for the Fight against Corruption has continued, but the co-ordination of measures amongst the relevant ministries and bodies has continued to be weak. Further progress has been achieved on increasing transparency in the field of public procurement, public enterprises and party financing. Progress has been made on implementing the Law on Free Access to Information, thus contributing to increased transparency within the administration and reinforcing the fight against corruption. Despite a high degree of alignment of legislation, corporate crime is a specific problem and the business climate is characterised by legal uncertainty attributable to the still weak functioning of the judiciary and a certain instability of the legal framework.
Slovenia	Corruption appears to be a rather limited problem although public perception seems to regard corruption as more widespread than shown by official statistics. Progress has been made in the past year in establishing a coherent anticorruption policy. Although there is no specific anti-corruption legislation, a legal framework for anticorruption measures has been established. Slovenian legislation includes provisions on conflicts of interest, but public procurement in particular remains a vulnerable area. Preventing conflict-of-interest situations should be given more attention. OLAF's partner in Slovenia: Slovenian Ministry of Finance Slovenian Customs Slovenian Police
Turkey	Corruption remains a serious problem in Turkey. A number of steps have been taken to prevent corruption and corrupt practices. The adoption of a strategy to enhance transparency and good governance is a welcome development, and due attention should now be given to its implementation.

Timeline

The Commission will assess the progress on anti-corruption measures in the 10 future Member States and three candidate countries in its regular report, to be adopted on 5 November 2003.