Criminal liability for illicit enrichment was introduced in 2015. It was part of Ukraine’s action plan for visa liberalization with the EU as well as the country’s commitment with the IMF cemented by a memorandum. The provision came into the spotlight last week.
The Constitutional Court’s decision.
On February 26, 2019 it became known that the Constitutional Court ruled unconstitutional the Article 368-2 of the Criminal Code that foresees holding civil servants liable for illicit enrichment
The court decided that the provisions of the Article do not sit well with rule of law principles and with the presumption of innocence. According to the court, the Article on illicit enrichment allegedly forces the suspect to prove that their assets are lawful.
Reaction of the civil society and of experts.The Constitutional Court’s decision implies full amnesty for all officials with assets of dubious origin, it actually annuls the anti-corruption reform in Ukraine, stated Transparency International Ukraine and its ten partner organizations. As a result at least 50 cases on illicit enrichment of top officials currently investigated by the National Anti-Corruption Bureau will be closed. Indictments in all the cases currently considered in court will be also closed.
Moreover all civil servants, subject to e-declaration will get the green light to legalize the assets of unlawful origin acquired over the past two and a half years after the liability for illicit enrichment was introduced. It may well lead to the situation when the civil servant’s assets exceeding their official income by millions of hryvnia will thus become legal.
Revocation of liability for illicit enrichment ruins the concept of e-declaration mandatory for civil servants. It is going to turn the declaration system from the mechanism designed to uncover illegal assets and to hold liable into the system that is just informing on civil servant’s assets.
If there is no liability for illicit enrichment, civil servants will be declaring luxury assets without fear and with no legal consequences. Experts also emphasize that decriminalization of illicit enrichment violates Ukraine’s international commitments and may lead to termination of the cooperation with the International Monetary Fund.
Reaction of the EU. The EU expressed its concern with the Constitutional Court’s decision to annul the article of Ukraine’s Criminal Code on illicit enrichment. “We have certain concerns concerning yesterday’s constitutional court ruling concerning the illicit enrichment (…). Of course, we will need to asses this ruling in more detail, but it must be said that the principle legal presumption is the principle that the person who possesses certain assets, certain wealth, has to be able to prove the origin of those assets,” said Valdis Dombrovskis, the European Commission Vice-President for the Euro and Social Dialogue, as quoted by the media “Europeiska Pravda”.
Reaction of the President Poroshenko.The President of Ukraine Poroshenko said he understands the indignation around the decision of the Constitutional Court to revoke the article of the Criminal Code on illicit enrichment.
President Poroshenko stated that he signed off a draft law on criminal liability for illicit enrichment last Thursday and sent it to the Verkhovna Rada (Ukraine’s Parliament) for immediate registration. He also said he hopes the MPs will be willful and brave enough to support the bill.
What the draft law is about. The draft law submitted by the President suggests instead of the article 368-2 that was ruled unconstitutional, add the article 368-5 “illicit enrichment” to the Criminal Code that foresees imprisonment for up to two years, ban to hold certain positions for up to three yearsand confiscation of assets for illicit enrichment.