Ukraine’s civil society slated a draft law to establish an independent anti-corruption law submitted to parliament by Ukraine’s President Petro Poroshenko that could result in international donors cutting off their aid to the embattled country if passed into law.

The president sent the draft bill to the Rada on December 22, but the details have just been released and the draft ignores key recommendations by the EU’s Venice Commission that donors insist be adopted.

“Should the draft law be adopted in the form, submitted by the President, it will not solve existing problem of courts delaying consideration of the National Anti-Corruption Bureau of Ukraine (NABU) cases. Instead of setting up a really independent anticorruption court, a fake institution vulnerable to external pressure will be established,” the civil society Anticorruption Action Centre (Antac) said in a note on its site.

Setting up of a fully independent anti-corruption court has become the central demand of Ukraine’s international donors and increasingly any further aid the country is going to received is being tied to the establishment of a court to hear corruption cases that is entirely independent from government pressure.

The International Monetary Fund (IMF) delayed its last tranche of $1.5bn from December to the first quarter of 2018, due to lack of progress in establishing the court. Likewise, the European Union (EU) cancelled the transfer of €600mn of aid money explicitly citing the lack of progress in establishing the court.

The donors have demanded not only that the court be set up, but that the recommendations on how the law is framed, drawn up in detail by the so-called Vienna Commission, be adopted.

The court is the third pillar in a donor-backed anti-corruption triumvirate to stamp out endemic corruption in the Ukrainian government. An independent investigative agency, the National Anti-Corruption Bureau of Ukraine (NABU) that can bring charges, has already been established, as well as the Special Anti-Corruption Prosecutor’s Office (SAPO) that can prosecute corruption cases, but the problem is there is no court in which to hear these cases. The existing court system remains very corrupt, despite some judicial reforms pushed through in December. The country’s top policeman general prosecutor Yuriy Lutsenko remains a close Poroshenko ally and has openly attacked NABU’s work.

Poroshenko’s version of the law to establish the new court fails to meet the donor’s demands on several counts. Antac released a note detailing the shortcomings and listing the key recommendations of the Venice Commission that are fully neglected by the draft law No7440:

• nominees of international donors are given an advisory role, instead of a crucial one, in the selection of judges;
• jurisdiction of the court does not fully cover cases investigated by NABU and on the contrary – covers cases which are not related to (high profile) corruption as such (drug dealing and arms trafficking, which involve officials);
• discriminative eligibility requirements towards international donors who can nominate advisory experts for the selection of anticorruption judges: only international organizations with which Ukraine cooperates in the field of combating corruption can nominate experts, while foreign aid agencies that provide technical support and funding for anticorruption efforts are not eligible.

Moreover, experts from a Ukrainian working group that has been advising the government on formulating the law for more than a year were not mentioned in the citations attached to the draft law. Antac said it has never heard of those experts that were cited in the document nor could it find published work by them.

There was no public discussion of the law nor were any civil society bodies involved in drawing up the draft. Despite the claims of the president that OCSE experts were involved, the OCSE itself denied the claims.

“According to official web-site of the President, his draft law has been developed by a group of experts that included founder of the Fund for Innovations and Development Georgiy Vashadze, director of the same Fund Roman Yakovlev, and scientists and OCSE experts Anatoliy Zayets and Valentyn Serdiuk. However, today Oleksandr Vodyannikov, OSCE representative and a member of the Council for Judicial Reform informed, that the OSCE was not involved in development of the draft law and that experts referred to as OSCE experts were only contracted by the organization some time ago and are not representing it now,” Antac said in its note.

Failure to establish an anti-corruption law that is acceptable to Ukraine’s donors threatens to derail the provision of further aid money and could cause the EU to rescind its visa-free agreement with the government in Kyiv.

In October 2017 the Venice Commission of the Council of Europe gave a comprehensive opinion on advisable model of the anticorruption court for Ukraine and the general director of the IMF Christine Lagarde said explicitly in December that the new court must take on board all the Vienna Commission recommendations.

In addition, the European Commission in its first report under the Visa Suspension Mechanisms introduced earlier this year stated that it is “critically important to ensure the independence, effectiveness and sustainability of the anticorruption institutional framework, in particular by setting up an independent and specialised high anti-corruption court in accordance with the Venice Commission opinion and Ukrainian legislation.” If the EU reject the draft version submitted to the Rada this week then the visa waiver programme may be nixed.

The government dependence on the IMF and other donors has been significantly reduced this year after Kyiv was able to tap the international capital markets starting with a $3bn bond in September, but also several smaller foreign currency bonds issued on the domestic market in the subsequent months.