Constitutional Court overturns illegal enrichment statute

The Constitutional Court of Ukraine published on Feb.
27 a ruling overturning a criminal statute outlining punishment for officials
who are determined to have enriched themselves illegally. The court determined
the statute is unconstitutional because it violates the presumption of
innocence of those accused, as well as their privilege against
self-incrimination. Specifically, the statute requires the accused to prove the
legality of how they acquired their assets, or prove their innocence. It also
gives the accuser the right to demand from the accused evidence of the legality
of how assets were acquired, as well as the ability to prosecute on the mere
basis of the absence of evidence of the legality of how assets were acquired.
These formulations violate basic rule of law principles set in the Constitution,
the court ruled.

The court’s ruling means that all the criminal cases
currently being investigated and prosecuted by the National Anti-Corruption
Bureau under the statute will be immediately closed, the bureau head Artem
Sytnyk said in a Feb. 27 statement. There are 65 such cases targeting
high-ranking officials involving more than UAH 500 mln in alleged corruption,
he said. “Four years of work of the National Anti-Corruption Bureau are wiped
out,” said Vitaliy Shabunin, the head of the Anticorruption Action Centre. One
such case is against Pavlo Demchyna, the first deputy head of the Security
Service of Ukraine, whose ability to purchase UAH 4 mln in land and cars
weren’t proved by his declarations, the centre reported. Others investigated
include Prosecutor General Yuriy Lutsenko, former State Fiscal Service Head
Myroslav Prodan, Radical Party Head Oleh Liashko and Kviv district court judge
Pavlo Vovk, who is suspected of concealing assets through a fake divorce.

As evidence that the president’s entourage arranged
the court ruling, MP Mustafa Nayyem cited comments made by Prosecutor General
Yuriy Lutsenko in February 2015 endorsing the illegal enrichment statute, which
he helped draft. “This is among the key laws for fulfilling the demands of the
maidan for a real fight against corruption,” Lutsenko said at the time. “It has
been drafted with a Western, European approach in which the main thing is not
only to punish corrupt officials, but also confiscate their stolen property.”
This time around, Lutsenko referred to the statute as “dead, or that which
can’t be applied in practice.” He added, “Obviously, we need to correct the law
and move decisively in this direction.”

In response to the public outrage, President
Poroshenko said on Feb. 27 he will give instructions to prepare and submit to
parliament without delay a new bill on punishing officials for illegal
enrichment. He didn’t offer specifics in the Facebook post.

Zenon Zawada: In one fell
swoop, the Constitutional Court rescued dozens of high-ranking officials from
corruption investigations and possible prosecutions under a new president. The
critics’ claims are credible that the court reached its ruling at the behest of
the president. In the context of the election campaign, this is a reward for
the loyalty of the president’s political team that faced corruption charges,
including Lutsenko, who has made a dramatic transition from his days as a
political prisoner and EuroMaidan activist.

This development adds to the mounting speculation that
Poroshenko and his entourage are making preparations for their departure from
office. Earlier this month, MP Serhiy Leshchenko alleged that the president
arranged for the re-election of two judges to the Supreme Council of Justice –
in violation of its bylaws – to ensure that he’d have loyal officials to block
any harmful court rulings. Indeed both Hrechkivskiy and Malovatskiy
were reappointed at the lawyer congress.

However, we are confident that Poroshenko will go to
extremes before surrendering the presidency. Not only is he concerned about
revenge from his fierce rivals (Tymoshenko and Zelenskiy/Kolomoisky), but he
will destroy his political career in handing over power, which is the only
basis for his support. Instead, we believe he will try to cling to the
presidency, regardless of the election results, until the October parliamentary
elections, in which he’ll be able to bring a party to parliament. That way, he
can use political immunity to preserve his political career and business. It’s
not clear whether he will be successful in such attempts.

As more evidence of the Poroshenko team’s “scorched
earth” tactics, the Anticorruption Action Centre alleged that the court’s
ruling will cost Ukraine any future IMF loan tranches given that the illegal
enrichment statute was a key requirement for the memorandum signed in 2014. The
law was also an EU requirement for, among other agreements, its visa-free
regime and macrofinancial assistance loans, the centre alleged.