Zelenskyy Set to Reinstate Illegal Enrichment Law
4 June, 2019
Presidential Administration of Ukraine

The fight against corruption is back on! On February 26, the Constitutional Court took what many considered a backward step for anti-corruption efforts when they ruled Article 368-2 of the Criminal Code of Ukraine null and void.

This section of the law scrutinized the potential of illegal enrichment. When the law was deemed unconstitutional, dozens of cases against MP’s, judges and other public officials were closed. The Constitutional Court backed its decision by noting that the United States does not have such an article.

However, many organizations warned that the abolition of an article on liability for illegal enrichment could lead to the termination of cooperation with the International Monetary Fund (IMF).

On June 3, President Volodymyr Zelenskyy made it known that this type of behavior would not be allowed under his administration, when he submitted a draft law on the liability for illegal enrichment to parliament. If the law is adopted, it will be possible to prosecute any state or local official.

President Zelenskyy’s explanatory note stresses that Ukraine has an obligation to the IMF to detect illegal enrichment. His draft law defines illegal enrichment as the acquisition of assets, whose value must be more than 12 thousand non-taxable minimum incomes of citizens (204,000 hryvnia or $ 7,600) exceeds the official income of the person. Criminal liability in case of adoption of the law will occur if illegal enrichment exceeds 380,000 hryvnia ($14,100), anything less will be charged in civil law.

Furthermore, the draft law provides for the addition of article 368-5 (Adoption of a proposal, promise or receipt of unlawful benefit by an official) of the Criminal Code, which provides for punishment for illegal enrichment in the form of imprisonment for a term of five to ten years with deprivation of the right to hold certain political positions or engage in certain activities for up to three years.

On June 4, 2019, the representatives of the presidential administration described the advantages of the presidential law on illicit enrichment

“The new bill on illegal enrichment is retroactive, does not apply the principle of presumption of innocence, and provides for both criminal liability and civil penalties,” noted the Deputy Head of the Presidential Administration Ruslan Ryaboshapka at a briefing. This means that materials from previously opened NABU and SAPO cases can be used again, making the civil procedure much faster and more efficient.

According to Ryaboshapka, the bill on illegal enrichment provides not only criminal liability, but also the possibility of confiscating or collecting so-called “unjustified assets” for the state.

The deputy head of the presidential administration noted that the possibility of recovering unjustified assets in civil law is used by many countries, in particular the UK, and is also accounted for by the UN Convention Against Corruption and, “completely removes risks from the presumption of innocence,” as the presumption of innocence does not apply.

He noted that in 2015 this rule was included in civil law legislation, but the wording of the law prohibited the practical application.

“We have changed this wording, and now there is an opportunity to effectively apply this rule,” he said.

/By Allison Martinez