Poroshenko says he hopes anti-corruption law will satisfy Western demands

Ukrainian President Petro Poroshenko expressed his hopes
that the draft law to create the High Anti-Corruption Court will comply with
both Ukrainian law, as well as the recommendations of the Venice Commission of
the Council of Europe, Interfax-Ukraine reported, citing his comments from a
meeting with businessmen on March 12.

Currently, Ukraine’s parliament is working on drafting
the law in the second reading after it was approved in the first reading
on March 1. That draft was heavily criticized by the IMF and World Bank, who
are particularly dissatisfied with the selection process of the court’s judges
in which local judges have the authority to select those disqualified by
international experts. Approval of the law in line with IFI demands is essential
for Ukraine to receive over USD 2 bln in financing this year from the IMF, the
World Bank and the EU.

Recall, in his interview to the Financial Times
published on March 6, Poroshenko stated that selection of anti-corruption
judges by “foreign donors” does not adhere to Ukraine’s
constitution. If the donors insist on their
exclusive role in the selection process, the president warned that some
Ukrainian party will apply to the Constitutional Court to repeal such
legislation, in what was widely seen as a veiled blackmail attempt.

Alexander Paraschiy: Ukraine’s
lenders indeed have to review not only whether the law is in line with their
standards, but also that it does not contradict the constitution. In our view,
there is a risk that certain MPs will sneak in some unconstitutional clauses in
the law, like a time bomb, to enable its appeal in the Constitutional Court,
but only after Ukraine gets financing from IFIs this year. Of course, this has the
potential for an international scandal, though the president can always shrug
his shoulders and tell the lenders that they were warned.

We still see the approval of a law meeting minimal
requirements as our base-case scenario. But eventually, when forced to finally
launch the court, we expect that power brokers will make the necessary
adjustments to make the court fit their needs (and prevent it from threatening
their power), regardless of the legislation that is approved by the IFIs.