Ukraine has established a set of specialized anti-corruption institutions responsible for the full criminal justice process as it relates to grand corruption to replace the non-performing law enforcement and judicial systems, including the investigation, prosecution, and adjudication of high-profile corruption cases. Those agencies are the National Agency on Corruption Prevention (NACP), National Anti-Corruption Bureau (NABU), Specialized Anti-Corruption Prosecutor’s Office (SAPO), High Anti-Corruption Court (HACC), and Asset Recovery and Management Agency (ARMA). However, experience has shown that their effectiveness has greatly depended on the quality and integrity of the institution’s leader. The establishment of Ukraine’s anti-corruption system was completed in 2019 with the establishment of the last of the five specialized anti-corruption bodies, the HACC. Ukraine’s anti-corruption bodies have been persistently challenged by the lack of independently selected, permanent leadership, although things have recently improved. When the full-scale invasion seized Ukraine, just two-of-five institutions had independently selected leadership. As of May 2023, four-of-five do, with the lone exception being ARMA which has not had an independently selected head for more than three years. For all these bodies, successful institutional establishment and leadership selection often only happens because of strict international conditionality.
In June 2022, in bestowing candidate status to Ukraine, the European Union listed seven requirements for Ukraine to implement, five of which tackle the rule of law, before accession negotiations could proceed. These requirements include reforming the Constitutional Court, ensuring independently selected SAPO and NABU leadership, reform of Ukraine’s judicial governance bodies, and implementation of the anti-oligarch law to limit the excessive influence of oligarchs in economic, political, and public life, among others.
Similar requirements were mirrored by the IMF when concluding Program Monitoring with Board involvement (PMB) for Ukraine. In its MoU with the IMF Ukraine committed
to support the future work of the new SAPO head appointed in July 2022, reinforce the office with the onboarding of eight new and budgeted SAPO prosecutors by end-December 2022 and
to advance selection of the new NABU head involving independent experts with international experience and to appoint the new head by end-March 2023, following an open, transparent and competitive selection process. On March 31, 2023, the IMF announced an Extended Fund Facility lending program for Ukraine which included restoring asset declaration filing and strengthening SAPO institutional independence as key conditionalities.
March 6, 2023, based on the outcomes of the selection process the Cabinet of Ministers of Ukraine appointed the new NABU Head.
On March 4, 2023, the Cabinet of Ministers of Ukraine adopted the State Anti-Corruption Program for 2023-2025 as an implementation plan for the National Anti-Corruption Strategy for 2021-2025, adopted by parliament in June 2022. It offers an action plan and timeline for 1,700 actions and policy measures to reduce corruption and safeguard integrity across 15 areas. An online implementation tracker is to be launched to monitor implementation progress.
Despite a fully functional Agency for the Recovery and Management of Assets (ARMA), no effective system for tracking and reclaiming assets obtained through corruption has been set up. Ukraine is still due to organize transparent competition to select the head and safeguard the further institutional development of ARMA.
Asset declaration: Ukrainian public officials must file annual electronic declarations of their income and assets. The National Agency on Corruption Prevention (NACP) was established to collect, verify, and publish asset declarations. The system of electronic disclosure of assets and income of public officials is the most instrumental source of information to monitor the lifestyle of public officials. The information submitted there serves as the basis for official investigations into illicit enrichment and exposing corruption by journalists and civil society monitors. However, in early 2022 martial law temporarily lifted an obligation to file asset declarations by public servants for security reasons.
Ownership registries: Ukraine built state-of-the-art government databases revealing the ultimate beneficial owners of Ukrainian properties, vehicles, land, and legal entities. However, in early 2022 martial law temporarily restricted access to multiple ownership registers based on security concerns.
Public procurement: Following the full-scale invasion and throughout martial law, public tendering regulations were amended to introduce various limitations and conditionalities to the use of ProZorro, Ukraine’s award-winning electronic public procurement platform for the entire Ukrainian government to publicize procurement solicitations, share requests for proposals, and run auctions.
Integrating Ukraine’s anti-corruption achievements into its wartime and rebuilding processes will require using its world-class transparency systems like ProZorro, empowering the specialized anti-corruption bodies with needed resources and permanent leadership, and giving Ukraine’s vibrant civil society a prominent role in planning and overseeing the flow of funds.
November 5, 2021, President Zelenskyy signed law #5599 “On the Prevention of Threats to National Security Associated with the Excessive Influence of Persons of Significant Economic and Political Importance in Public Life (Oligarchs)” launching deoligarchization reform to curb their detrimental impact on economic, political, and public life. The law defines the term “oligarch” setting four criteria. Anyone meeting three of those criteria is to be designated an “oligarch” and included into the register of oligarchs subject to prohibitions. The register was due for a launch in April 2022, however timely implementation of the reform was impeded by the war. To cover for the delay, on February 24, 2023, the Cabinet of Ministers of Ukraine adopted a new implementation timeline: the registry of oligarchs is due within three months following the receipt of the Venice Commission recommendations to the law. The law will be also subject to amendments to reflect recommendations of the Venice Commission. The Venice Commission opinion on the Anti-Oligarch law was issued at the June 2023 Venice Commission plenary session. The Commission characterized the law as taking a “personalized” rather than “systemic” approach to de-oligarchization. The VC recommended confronting the problem of oligarchs through an effective competition policy, anti-corruption and anti-money-laundering measures, measures to ensure media pluralism, and rules on the financing of political parties and election campaigns.
Ukraine’s judicial sector remains weak and prone to corruption, creating another major obstacle to private investment. According to pre-war surveys conducted by the American Chamber of Commerce and the European Business Association, lack of trust in Ukraine’s judiciary is the number one deterrent for greater investment in Ukraine. Additionally, the head of the Supreme Court of Ukraine was arrested in May 2023 for accepting a $3 million bribe, a sign of ongoing corruption but also the will and capacity of anti-corruption institutions to address it. Nevertheless, efforts to reform the judiciary have made significant progress in recent years. In 2021, parliament adopted historic legislation to reform Ukraine’s two judicial governance bodies: the High Qualifications Commission of Judges (HQCJ), the body responsible for selecting new judges, and the High Council of Justice (HCJ), the body responsible for appointing them. The HCJ was reestablished in January 2023 with vetted membership and the HQCJ was reestablished in June 2023. Both institutions are now poised to select and appoint new judges to the roughly 2,200 judge vacancies across the country as well as address a backlog of more than 7,000 judicial misconduct cases, punishing and removing corrupt and criminal judges, as a means to renew Ukraine’s judiciary. The government also eliminated the notoriously corrupt Kyiv District Administrative Court and is in the process of replacing it with an entirely new entity.
An additional step to support judicial reforms and advance democracy would be for Ukraine to join the European Public Prosecutor’s Office (EPPO). Founded in 2021, its role in the EU integration and accession process is untested. Opening EPPO membership to candidate countries, including Ukraine, could contribute to their alignment with EU judicial standards, and it could strengthen the rule of law early in the integration process. In March 2022, Ukraine became the first non-EU country to sign a working arrangement with the EPPO, focusing on judicial cooperation in criminal matters and exchange of information. Fully joining the EPPO would add a layer of EU oversight over EU-funded projects.
In an April 2023 USAID, Department of Commerce, and AmCham Ukraine report, U.S. and foreign investors cited corruption, especially as it applies to the judiciary, customs, and government services, as a key challenge in Ukraine. Areas of focus continue to be in the expansion of digitalization to increase transparency and reduce physical interactions between investors and public sector officials, strengthening existing anti-corruption institutions, strengthening anti-corruption legal framework and the capacities and powers of existing oversight institutions, promoting an open approach and communication on corruption and aligning with EU acquis Directives and accession requirements related to fighting corruption.
Resources to Report Corruption
NABU, established in October 2014, is the appropriate resource for the reporting of high-level corruption.
Government of Ukraine contact for combating corruption:
National Anti-Corruption Bureau
3, Vasyl Surikov St, Kyiv, Ukraine 03035
Corruption Reporting eForm: http://nabu.gov.ua/povidomlennya-pro-kryminalne-pravoporushennya
Contact at Transparency International:
Mr. Andriy Borovyk
Transparency International Ukraine
37-41 Sichovykh Striltsiv Street, 5th floor, Kyiv, Ukraine 04053+38(044) 360-52-42