The Slovak parliament passed legislation aimed at clamping down on corruption in public procurement on October 25, with 121 votes supporting the key bill.
Provoked by several corruption scandals in recent years – in particular connected to state road contracts and healthcare – the “anti-letterbox” law has been heralded by NGOs as a potentially significant step in the fight against money laundering and the ‘tunnelling’ of public funds. The bill will establish a registry of public sector partners that can bid for public contracts.
Proposed by Justice Minister Lucia Zitnanska, the anti-letterbox law will cover all public contracts, including those issued by the healthcare system and state companies. All firms wanting to do business with the state will have to sign up to the registry of public sector partners and disclose its whole ownership structure.
"Through the anti-letterbox law, we are unveiling who the state trades with,” Zitnanska said according to TASR. “Those who want to lie will expose themselves to sanctions, up to erasure from the registry and a ban from applying for public funds.”
The public sector will be able to provide public funding and trade only with verified business entities listed in the online registry. Lawyers, tax consultants, notaries and banks will need to verify the names, and they will be responsible for the accuracy of the information.
Companies facing challenges will have to prove in court that their record is correct. Failure to convince the court will result in dropping off the list and sanctions.
However, listed companies will not be obliged to register, as they already have to disclose certain information and are under supervision, the bill states. Banks receiving loan repayments from the state or local authorities and entities supplying representative offices abroad will also escape the need to sign up.