On May 30, 2022, the Organization for Economic Cooperation and Development (OECD) published a report on the assessment of the corruption environment in Georgia. The report was developed by the OECD Anti-Corruption Network for Eastern Europe and Central Asia (OECD/ACN) within the fifth round of pilot monitoring, which, in addition to Georgia, was also carried out in Armenia, Azerbaijan, Moldova, and Ukraine. The pilot assessment of Georgia was launched in December 2020 according to the indicators and methodology pre-approved by the participating states. The approval of the report on the assessment of the Anti-Corruption environment in Georgia was planned at OECD/ACN’s 21st plenary session on October 26, 2021, however, the Government of Georgia hindered its adoption and demanded additional time with the aim of amending the text of the document. Following additional bilateral consultations between the Georgian delegation and the monitoring team, as well as the high level negotiations between the OECD and the Georgian government, the pilot monitoring report of Georgia was adopted in April 2022.
The pilot monitoring covered 13 Performance Areas comprising performance indicators and benchmarks, namely:
1. Anti-Corruption policy;
2. Conflict of interest;
3. Asset and interest disclosure;
4. Protection of whistleblowers
5. Independence of judiciary;
6. Independence of public prosecution service;
7. Integrity in public procurement;
8. Business integrity;
9. Enforcement of corruption offences;
10. Enforcement of liability of legal persons;
11. Recovery and management of corruption proceeds;
12. Investigation and prosecution of high-level corruption;
13. Specialised Anti-Corruption investigation and prosecution bodies.
Even though the report does not include information about the scores received by Georgia and the ratings of fulfillment of indicators in each performance area, based on the descriptive part of the monitoring report it can be said that almost all the thirteen areas are characterized by a low level of performance.
The report highlights gaps in terms of Anti-Corruption policy making. According to the monitoring team, the corruption situation analysis in the strategy is important to be comprehensive, however, Georgia’s latest national Anti-Corruption strategy focused mainly on the stock-taking of the previous achievements; there was no national risk assessment prior to developing the strategic documents and there is no justification for selecting priority areas that duplicate from one Anti-Corruption strategy to another. The report indicates that the policy documents do not explicitly acknowledge and address the problem of high-level corruption, although, Various local and international reports pointed to the issue of high-level corruption as an issue to address. According to the monitoring team’s assessment, high-level corruption cases are not properly detected and investigated. Herewith, relevant statistics on high-level corruption is not used to change policy or practice.
IDFI has been talking for years about the need to take appropriate measures to prevent high-level corruption. In the beginning of 2021, IDFI submitted its views and recommendations to the Anti-Corruption Secretariat to assist in the development of effective Anti-Corruption policy documents. IDFI called on the Secretariat to carry out an in depth situation analysis on corruption, including in terms of high-level corruption, and to reflect in the Anti-Corruption Strategy an important commitment of creation of an independent Anti-Corruption agency (It is important that the monitoring team did not share the government’s position on recognition of the Prosecution Service and State Security Service as specialized Anti-Corruption investigative bodies). Unfortunately, the new national Anti-Corruption action plan, which was supposed to define the measures to be implemented by the agencies in 2021-2022, has not yet been developed in the third quarter of 2022. The tendency of significant time gaps between policy documents is negatively assessed and according to the monitoring team’s opinion this cannot but impact the effectiveness of the Anti-Corruption policy implementation in Georgia. It needs to be mentioned that within the fourth round of monitoring the OECD highlighted the need for strengthening the Anti-Corruption policy coordination body and recommended Georgia to equip the secretariat of the Anti-Corruption Council with appropriate resources. Instead, for the past few years, the National Anti-Corruption Council has not even assembled, and the Secretariat of the Anti-Corruption Council only formally exists, which, in turn, further hinders the implementation of Anti-Corruption policy. Attention is drawn to this issue in the European Commission’s opinion on Georgia’s application for membership of the European Union.
The report also critically assesses other sectoral directions. As the monitoring team states, the legislation regulating conflict of interest is not comprehensive. Violations of COI rules are not identified properly, and the enforcement of COI regulations is weak. Monitoring of COI situations is not sufficient in the civil service and there is no practice of routine application of dissuasive and proportionate sanctions for COI-related violations across the public sector.
According to the report, despite a developed system of asset and interest disclosure of public officials, some challenges still exist in this direction. For example, the scope of declarants omits several categories of high-risk officials. The content of the disclosure form is not sufficiently comprehensive, as it excludes several important categories such as the source of income, unpaid activities, disclosure of beneficial ownership. There is a very low track record of cases referred to law enforcement agencies, while administrative sanctions mainly concern insignificant infringements. The monitoring team negatively assesses the 2019 amendment in the law according to which disclosure obligation no longer applies to companies which have been inactive for the past six or more years.
The pilot monitoring also revealed a number of challenges regarding the whistleblowing mechanism, which IDFI also focused on. According to the report the system does not appear to operate in practice. Whistleblower protection does not cover reports within the private sector. General whistleblowing legislation also does not apply to law enforcement agencies, which is a significant gap in terms of whistleblower protection within the public sector as a whole. The report mentions that pre- and post-retaliation protection measures are not provided.
The monitoring team pays attention to the challenges of the judicial system. According to the report the rule for selecting the chairpersons of the court is not detailed, candidate selection criteria are vague, which directly echoes the critical views expressed by IDFI regarding the judicial system. The transparency of the selection process of the members of the High Council of Justice is negatively evaluated. There are no safeguards against arbitrary decisions regarding the appointment and promotion of judges, appropriate rules for avoiding conflicts of interest, obligation to make merit-based decisions, etc. The document also discussed the problems related to the publication of court acts and enforcement of the decision of the Constitutional Court made on June 7, 2019. IDFI has been talking about these challenges for years.
According to the report, recruitment and promotion are not sufficiently regulated within the prosecution service as well, and existing procedures fail to adequately ensure competitive and merit-based recruitment. According to the monitoring team’s assessment the existing legislation leaves excessive discretion to the Prosecutor General in the recruitment process. IDFI also drew attention to the mentioned shortcomings and called on the Prosecution Service of Georgia to ensure transparency, fairness and objectivity of appointment and dismissal procedures of prosecutors as well as disciplinary proceedings within the prosecutorial service. The monitoring team considers that procedure and respective practice for the appointment of the Prosecutor General needs further improvement, especially assessment of professional qualities and integrity of the candidates. It is noteworthy that the monitoring team refers to the recommendation of the Venice Commission and emphasizes the need to increase the representation of civil society in the Prosecutorial Council to further ensure its independence.
Despite the relatively positive assessment of state procurement, the current challenges in this direction were not left out of attention either. The monitoring team indicates a high percentage share of simplified procurement. IDFI also emphasized the need for a more limited use of simplified procurement during the Coronavirus pandemic. Accessibility of procurement-related information in an open format as well as lack of transparency standard in case of subcontracting or market review results are also identified as a challenge.
According to the monitoring team’s assessment, the absence of an obligation to register beneficial owners of legal entities in a central register and disclose this information publicly remains a significant challenge that IDFI has been talking for years. The report also points to the absence of corporate governance code of listed companies. Herewith, it states that the Business Ombudsman, established to protect the rights and legitimate interests relating to the entrepreneurial activities of persons in Georgia, lacks human and financial resources. It’s noteworthy that according to the report, the Government has not implemented incentives for companies to improve their integrity and prevent corruption in their operations.
The analysis of data related to corruption offences is also assessed as problematic. The monitoring team indicates that the authorities do not analyse comprehensively the enforcement statistics on the central level as well as do not fully publish them. Data on seizure and confiscation in corruption offences is not accessible. The same problem can be seen with regard to statistics on detection, investigation, prosecution, trial, and sanctions applied to legal persons.
Considering the results of pilot monitoring, it is even more alarming that in recent years the Georgian Government has stalled the implementation of Anti-Corruption reforms. The Interagency Anti-Corruption Coordination Council, which is responsible for determining, monitoring, and assessing the country’s Anti-Corruption policy, as well as for fulfilling international recommendations, has not been assembled for the last several years. Georgia’s implementation of Anti-Corruption recommendations issued by international organizations is characterized by low progress that clearly indicates a transition to a passive phase in the fight against corruption in the country. Georgia is deteriorating its own Anti-Corruption indexes and moves back in international rankings. The existing practice indicates that effective Anti-Corruption policy is no longer a priority in the country. It is worth mentioning that within the opinion on Georgia's application for membership of the European Union, the European Commission indicates that more needs to be done to strengthen the Anti-Corruption processes and their effectiveness, and also notes that further decisive actions are required to tackle high-level corruption.
Pilot monitoring results once again show that it is necessary to reform the Anti-Corruption system. To overcome the existing challenges, it is crucial that Georgia adheres to the recommendations of both local organizations and international Anti-Corruption institutions. IDFI calls on authorities to acknowledge the existing challenges addressing of which is critical for successful implementation of reforms, renew the implementation of Anti-Corruption reforms, and pay more attention to the fight against corruption.
This material has been financed by the Swedish International Development Cooperation Agency, Sida. Responsibility for the content rests entirely with the creator. Sida does not necessarily share the expressed views and interpretations.
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