From September 1, 2016 a fundamentally new anti-corruption instrument - electronic declaration will start up. All politicians’ attempts to postpone its implementation split upon an unbreakable rock of Western partners and civil society.
All declarations will be made public. The purpose of e-declaration is to identify illegal proceeds and corruption risks, and determine the benchmark to compare an adequacy of public officer’s lifestyle with his/her revenues.
Declaration subjects. Who is obliged to file declarations?
The system will start up in 2 stages:
1 Stage (before November 1, 2016) – the highest officials – President and his advisers, Head of Presidential Administration and his deputies, members of the Cabinet of Ministers, Ministers and their deputies, all judges, prosecutors and employees of National Anti-Corruption Bureau of Ukraine.
2 Stage (from January 1, 2017 and until April 1, 2017) – local deputies, local government officials and absolutely all state officials, managers of state companies and heads of state universities.
Declaration objects. What and whom the Ukrainian VIP officials should write in their declarations about?
- Immovable property, movable property (which price amounts to UAH121, 800 and more), cars, IP.
- Securities and corporate rights, legal entities which are de facto controlled by declarant.
- Cash funds (cash, deposits, contributions), bank metals, incomes (salary, remuneration, dividends, royalties, gifts, etc.).
- Financial liabilities (credits, loans, leasing, insurance).
In practice ALL property is subject to declaration, not only jewelry and antiques, but items of luxury clothes and expensive bijouterie.
The main thing is that not only the property belonging to the declarant personally, but the property owned/used by the members of his family.
The following individuals should be qualified as the family’s members: (1) declarant’s parents, husband/wife, their children, including adults, (2) persons who are under guardianship, (3) persons living together with him/her, including those who are not married to him/her. This complicated wording also embraces the so-called law husbands and wives, even when the declarant is officially married to another person.
We have another bad news for the first category of declarants. Their declarations should additionally include the data of the property of third parties being not the members of their family. The people’s deputies, Ukrainian top public officials, members of the Cabinet of Ministers and heads of Ukrainian central authorities should additionally emphasize their right to gain an income resulting from the third parties’ property or possibility to dispose thereof.
They will have to indicate their companies and immovable property (not only in Ukraine), boats and aircrafts which they de facto own, notwithstanding the fact that they are formally owned by an offshore with an unclear beneficiary.
The nominees institute comes to an end. Good-byes the holders of trust declarations from island jurisdictions, respectable managers of trust funds of Luxembourg and Liechtenstein. The use of standard scheme of anonymity of ownership without public declaration becomes a crime.
Incentive to be open and honest
The above-mentioned law highly motivates the individuals to be maximally honest in their declarations by bringing them to administrative and criminal liabilities.
Untimely filed declarations and casual errors therein should be punishable by imposing a fine. Repeated violations should deprive such a person of the right to hold certain positions for a 1-year period.
If the errors and unwillingness to file declaration bear intentional nature or any official is unable to prove the legality of acquired property, then criminal proceedings should be instituted against such a person.
Such new for Ukraine instrument as monitoring the declarant’s lifestyle will be an additional incentive to be cautious in demonstrating illegal wealth. The monitoring will be carried out by the Corruption Preventing Agency and becomes a wide field for the activity of journalists and public investigators. E-declaration will give new opportunities to the "yellow press" and declarants’ children should become more cautious in their Instagram accounts.