Reforming Anti-Corruption Legislations

Published On: May 7, 2023 09:00 AM NPT By: Narayan Manandhar

Corruption and anti-corruption are very much in the headlines. Besides media revealing high-profile cases, there are a couple of factors triggering the debate. First, some bills related to corruption and anti-corruption (amending corruption control Act, Procurement Act, the CIAA Act) are underway for amendment in the parliament. Second, the upcoming political party like RSP is very much vocal on the anti-corruption agenda. In fact, RSP fought elections on the plank of an anti-corruption agenda. Third, probably, in response to anti-corruption demands, the government too is making an anti-corruption hullabaloo. 

The Upper House has passed the bill amending anti-corruption (AC) law and, now, it is being tabled at the Lower House. In fact, AC law reform has been a pending issue since Nepal ratified UNCAC in February 2011. There are obligations to be fulfilled under UNCAC. These included drafting new AC laws, reforming existing AC laws, streamlining AC institutional arrangements and implementing AC policies and programs.

Over a period of five decades (1952-2002), Nepal has enacted four pieces of AC laws and experimented with various modalities of AC agencies. Yet, corruption remains unabated. Instead of us controlling corruption, it is the other way round. Among several issues, amending AC legislations have taken the center stage. However, reforming AC laws is easier said than done.

Going by the media, several issues are being floated for public debate and discussion.

The Statute of Limitations

First, the issue of haadmyad or the statute of limitations (SOL), i.e., the maximum period to initiate legal proceedings against corruption charges. The controversy surrounding SOL surfaced after NC leader Mr. Govinda Raj Joshi was acquitted by the Special Court on the grounds of SOL in 2006. The court's reasoning was that the case had been filed after the expiry of SOL. The CIAA charged Mr. Joshi as per AC law that came into force in 2002 but Mr. Joshi held ministerial portfolios before the law came into force and the law cannot be applied retroactively. Earlier law had one year SOL to file corruption charges. This simple technical flaw acquitted dozens of pending corruption cases.

Currently, the lawmakers have proposed a five-year SOL; with no limitations for serious charges like misappropriation of public properties. This five-year SOL has triggered public debate. Many assumed this to be an impunity measure to protect high profile corruption charges. Political party leaders have become very much vocal with this new proposal on SOL.

The fundamental issue should be: Are we interested in controlling past corruption or preventing future corruption? Controlling past corruption calls for sanctions and punishments while controlling future corruption emphasizes preventive measures and reforms. Definitely, strong sanctions and punishments are expected to deter future corruption. China and Vietnam impose death penalties but they have not been able to control corruption.

Some political parties are churning out absurd anti-corruption policies like digging into past crimes. When they speak about the word “past” there are differing opinions. RSP speaks of corruption crimes committed “at any point of time in history”, RPP speaks of “post 1990” while PM Dahal speaks of “post 1992”.Other than settling political scores or vendetta, there is no systematic reasoning behind this fixing of datelines.

Severity of Punishment

Second, the focus of law reform is on increasing the severity of punishment. Definitely, Nepal must be the country with the most lenient anti-corruption law. There is the 20% bonus provision which makes law a big joke. If a corruption convict accepts a court verdict, he is automatically eligible to claim a 20% discount on summary punishment.

The drafters of the new law have proposed a new slab of punishment where increasing the severity of punishment is at the core. As for example, earlier we had, at the minimum level, three months imprisonment for taking a bribe less than Rs 25,000. The proposed amendment has a minimum slab of one to six months imprisonment for bribery involving less than Rs 50,000. There  is no change proposed at the top slab, that is, 8-10 years imprisonment for bribery involving over Rs 10 million. RSP’s top slab proposal is to have 10-14 years imprisonment for bribes of Rs 100 million.

Earlier, a study conducted by the CIAA mentioned that “as there is no difference in punishment for taking bribes of Rs 10 million or Rs 20 million, the corrupt people are tempted to take more bribes”. Aside from this humor, the lawmakers should be aware that there is a tradeoff between “severity of punishment” and “probability of detection”. More severe the punishment, greater difficulty to detect the crime.

Tackling Policy-Level Corruption

The third agenda of AC law reform is on preventing “policy-level corruptions”. In layman’s terms this means giving authority to the CIAA to investigate Cabinet decisions. Definitely, in the past, Cabinet decisions were used in the pretext of policy decisions to ward-off possible CIAA scrutiny. Giving authority to the CIAA to open Cabinet decisions raises a fundamental question: Can an elected government be made subservient to the scrutiny of an anti-corruption agency? In the past, we had a confrontation between the CIAA and the Ministry of Finance over the latter’s Voluntary Income Disclosure Scheme (VIDS). There is a similar controversy now. We have relaxed the need to disclose the source of money, over a certain threshold, in foreign direct investment. What I meant to say is that  there is an inherent conflict between anti-corruption policy, calling for transparency and integrity, and a resource-poor government desperately seeking funding sources for development.

Controlling Private Sector Corruption

Fourth, there is a kind of ruckus now in the private sector over expanding the jurisdictions of the CIAA to investigate private sector corruption. The private sector is now arguing that such a step will dampen or discourage private sector growth and investment. The arguments given by the private sector are not only ill-founded, it is also out of context. If there is no need for controlling private sector corruption, why would their code of conduct enlist an anti-corruption agenda? The private sector constitutes the supply side of corruption. In the absence of the supply side anti-corruption measures, it will be too difficult to control corruption relying only on demand side measures. As per the labor law, an employee in the private sector can be fired for taking bribes. However, in the public sector, the convict not only loses his or her job, he or she has to serve prison sentences. Clearly, there is injustice in implementing anti-bribery law in the public and the private sectors.

In fact there are several issues related to AC law reform. Let me close this writing with an anecdote from Brazil. Maybe more than a decade back when Brazil drafted its anti-corruption law, The Economist commented something like this: Drafting anti-corruption law is like a medical doctor writing prescriptions. Only a pharmacist can read the prescription. Hope, our lawmakers do not get lost in the fog of law reforms.

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