MINISTRY OF FINANCE
CUSTOMS ADMINISTRATION
Programme: IPA 2008
Partner Country:Croatia
Area of Cooperation: Political Criteria – Fight against corruption
IPA TWINNING LIGHT PROJECT FICHE
“Strengthening anticorruption activities of the Customs Administration”
Project budget: € 230.000,00
STANDARD TWINNING LIGHT PROJECT FICHE
1.Basic Information
1.1Programme: IPA 2008
1.2Twinning Number:HR 08 IB FI 02 TL
1.3Title:Strengthening anticorruption activities of the Customs Administration
1.4Sector: Political Criteria – Fight against Corruption (Customs Union)
1.5Beneficiarycountry:Republic of Croatia
2.Objectives
2.1Overall Objective(s):
The overall objective of this project is ensuring an efficient implementation of anti-corruption legislation and policies of the Republic of Croatia in order to meet the pre-accession requirements concerning the chapter 29 (Customs Union) and chapter 23 (Judiciary and fundamental rights) of the acquis.
2.2Project purpose:
The project purpose is to assist the Croatian Customs Administration (CCA) in its effort to fully implement its Anti CorruptionProgramme, as an internal tool for implementation of national Anticorruption Strategy and its Actions Plan, by adjusting the system of preventing corruption to the EU standards and by implementing the most effective EU methods and solutions for suppression of corruption.
2.3 ContributiontoAccession Partnership/ Stabilisation and Association Agreement/National Programme for Integration of the Republic of Croatia into the EU (NPIEU)
The necessity of an efficient suppression of corruption in state institutions is emphasized in the following European Commission and national documents:
Opinion of the EC on the application of Croatia for membership in the EU – Avis (COMM( 2004) 257) stated that the effectiveness of the fight against corruption needs further strengthening. In particular more action should be taken to raise public awareness of corruption as a serious criminal offence, and to the effective prosecution of corruption cases. Action plans to prevent and combat corruption in the relevant law enforcement agencies (border police, police, customs, and judiciary) need to be developed.
COUNCIL DECISION on the principles, priorities and conditions contained in the Accession Partnership with Croatia and repeal Decision 2006/145/EC, from February 2008, stated the following:
-Continue to develop and implement Codes of Conduct/ ethics for officers and elected representatives as well as action plans to prevent corruption in the relevant law enforcement agencies (border police, police, customsand judiciary) and other public sector institutions and agencies; fully addressed public procurement related corruption. Establish specialist units for combating corruption within the appropriate services with an appropriate coordination mechanism between them and provide them with adequate training and resources.
-Take steps to ensure that the legal framework for tackling corruption is uniformly implemented and enforced including through the use of adequate statistics. Ensure that the standards set by international instruments are met, by putting in place the appropriate legislative and administrative measures.
-Take concrete actions to raise public awareness of corruption as a serious criminal offence.
-Ensure full cooperation of state authorities with the Office for Prevention of Corruption and Organised crime.
The National Anti CorruptionStrategy and its implementation Action Plan, adopted in 2008 as a result of revision of the National Anti CorruptionProgramme 2006-2008. These documents set clear measures, timelines, responsible institutions and resources, with aim to reinforce all forms of fight against corruption.
Furthermore, in item 3.23.4 the National Plan of the Republic of Croatia for Accession to the EU (NPAEU) for 2009 states the need and methods for the suppression of corruption.
3.Description
3.1Background and justification:
The realization of anticorruption policies in countries acceding to the European Union is an important political criterion required by the European Commission. It has been a reason of concern during 2004 and 2007 EU enlargements and it is very important subject in relation to the accession process of the Republic of Croatia. In light of the preparations of the Republic of Croatia for membership in the European Union (further on referred to as the EU), the suppression of corruption is one of the most important tasks of the state administration.
Corruption in general represents unlawful activity of individuals which seriously disrupts the system of values of each democratic and civil society. In line with the to the National Anti CorruptionStrategy, adopted by Croatian Parliament on 19 July 2008, a proper and efficient institutional framework is of crucial importance for successful suppression of corruption. It presumes right coordination and cooperation of relevant institutions implementing anticorruption policies and their efficient monitoring. Furthermore it recalls on experience gained during implementation of the previous National Anti CorruptionProgramme 2006-2008 that revealed the necessity to strengthen institutional framework with aim to efficiently implement Strategy and its implementation Action plan.The Action Plan for implementation of Anti CorruptionStrategy, adopted on 25 June 2008, is envisaged as a living document revised annually in order to follow an analyse implementation of the Strategy. It further elaborates goals set by the Strategy and enables systematic monitoring of the Strategy’s implementation.
According to the Croatia Progress Report from October 2009 it is stated under Political criteria, Anti – corruption policy that:
”There has been some progress in the fight against corruption. Implementation of the Anti-Corruption Strategy and related Action Plan has continued, which is a key Accession Partnership priority in this area. The legal framework to combat organised crime and corruption has been further improved. Amendments to the Criminal Code introduced new rules on confiscation of assets which reverse the burden of proof for persons convicted for organised crime or corruption offences. The National Council for monitoring the anti-corruption strategy has become more proactive, regularly holding public debates and hearings. A national anti-corruption campaign for the general public was launched. A National Police Office for the Fight Against Corruption and Organised Crime (PNUSKOK) has been operational within the General Police Directorate since February 2009. The Office for the Fight Against Corruption and Organised Crime (USKOK) continues to be active and has issued indictments in some important cases. It has begun to investigate possible high level corruption, initiating an investigation of a case involving a former government minister. There have been the first verdicts in some important cases brought by USKOK. In the second ‘Maestro’ trial, the Zagreb County Court issued prison sentences against two former vice-presidents of the Croatian Privatisation Fund (HFP).
However, corruption is still prevalent in many areas. The recently upgraded legal and administrative structures remain to be tested in practice. While the total number of corruption cases investigated so far has increased, the actual number of prosecutions remains low. There has been limited investigation of high-level corruption, the prosecution of which is frustrated by political influence. A culture of political accountability for the corruption being uncovered by USKOK is lacking. The administrative capacity of State bodies for fighting corruption continues to need improvement. Overall coordination of implementation of anti-corruption efforts still faces shortcomings. There has been no progress in preventing conflicts of interest. The Committee for the Prevention of Conflicts of Interest (CPCI) was re-established after a period of interruption but has not established a strong preventive role for itself.”
Corruption in customs seriously obstructs the flow of international business. It has a negative effect on the country’s institutions, not only does corruption undermine the legitimacy of the customs administration, but also it seriously affects the economy of the country by creating an uncompetitive business climate.
Within the Croatian Customs Administration, a Service for Internal Control and Supervision is the main actor responsible to deal with the prevention and suppression of corruption throughout its standard work. This Department works within the Central Office of the Customs Administration. The Service for Internal Control and Supervision is in charge of performing control and surveillance over performance of all organisational units of CCA with regard to correct application of customs, excise, tax and other regulations in order to reduce miss performance and unification of working practice, monitor and asses the risk of corruption and organised crime and accordingly undertakes adequate measures. The suppression of corruption and internal corruption as criminal offences is the obligation of all police officers, and especially of managers of organizational units of the Customs Administration.
In the beginning of 2007 the Central Department for Internal Supervision and Control has been reorganised into Service (higher organisational level) for Internal Supervision and Control within the Customs Administration’s Headquarters. Staff number has been increased from 9 to 17 staff. Accordingly, the number and quality of the audits increased, as well as its performance. During 2007 a total of 61 audits were performed including 14 inland customs offices and 47 border offices. A system on providing feedback on implemented controls has been ensured by the obligation of audited organisational units to report back to Service for Internal Supervision and Control, within the given deadline of 30 days, on measures undertaken based on findings and recommendations of the audit.
At the beginning of September 2007, the Customs Administration started a campaign on raising awareness of corruption as a serious criminal offence. The tools for the implementation of the campaign are posters that were placed on all organisational units and an e-form for reporting corruption; a free telephone line has also been opened for reporting corruption. In addition, the Customs web-site provides information on the anti-corruption campaign. Since then 14 reports were received and processed.
Pursuant to the adoption of the above mentioned national anticorruption strategic documents andAnti CorruptionProgram of the Ministry of Finance - Customs Administration has been adopted in June 2008. Its main purpose is to efficiently fight against corruption within the Customs Administration.
Furthermore, the Customs Administration continued to intensify its internal control activities. From the beginning of 2008 until mid September 2009 a total of 86 internal audits have been performed within customs houses and customs offices across the territory of the Republic of Croatia.The audits were focusedon correct and consistent implementation of customs, excise, foreign-trade, foreign-exchange, tax and other regulations with the aim to detect irregularities and standardise the performance in various customs organisational units. Beside this the controls were also targeting customs misconduct and corruption. The findings and recommendations of mentioned controls resulted in a number of disciplinary procedures and in the improvement of customs performance.
As part of the anti-corruption efforts, at the end of 2007 a new system of rotation of customs officers has been introduced enabling regular and systematic rotations through the customs offices. The system does not remain only at the local levels, but is systematically conducted under the surveillance of the Central Office. As regards combating corruption, Customs Administration has been continuously rotating customs staff within all customs offices. The Rotation Plan for the period from 15 September to 15 December 2008 and from 01 January to 30 June 2009 had been adopted. It covers 702 officers, representing 22% of total number of staff. Moreover, temporary and permanent exchange of customs officers has been continuously implemented. Since April 2008 until October 2009, there have been 2.880 redeployments in total. From 30 September 2008 to 15 September 2009, 443 customs staff was rotated. Disciplinary procedures were initiated on 43 staff for the reason of breach of duty. Currently the court procedures for criminal cases are running against 47 staff. During the above mentioned period employment has been terminated to 5 staff.
Improvement of effectiveness of abovementioned measures, the necessary harmonization and update of applied procedures and changes to operational and regulatory framework of the CCA anticorruption system are necessary to meet all demands required by national and EU anticorruption policies. In this respect this twinning light project is envisaged as a key instrument that would support CCA efforts to fight corruption.
3.2Linked activities (other international and national initiatives):
Phare 2005 “Improvement of the Ministry of Interior System in the Fight against Corruption”
This twinning light project has been implemented by Ministry of Interior in the course of 2008. Its goal was enhancing the law enforcement by improvement of institutional capacity of the Ministry of Interior (hereafter: MoI) system in the fight against corruption by adoption and implementation of modern approaches, investigation techniques and methods, increasing transparency and responsibility toward public and introduction of comprehensive internal procedures and guidelines as well as improvements in implementation of the National Anticorruption Programme. Implementation of the project finished in September 2008.
IPA 2007 “Strengthening Capacities of USKOK”
This twinning project aims to improve the institutional capacity and more efficient functioning of USKOK and efficient implementation of the National Anti-Corruption Strategy. The Office for Suppression of Corruption and Combating Organized Crime (USKOK) is a specialized State Attorney's Office competent for the whole territory of the Republic of Croatia created by the Law on USKOK at the end of 2001 with the mandate to prosecute corruption and organized crime. Also, it is competent for prevention of corruption. This project is planned to start in January 2010 and end in March 2012.
IPA 2007 “StrengtheningAnti-CorruptionInter-Agency Co-operation – Management support of the Ministry of Justice Anti-Corruption Sector”
This twinning project aims to strengthen the rule of law in Croatia, through a more effective implementation of National Anti-Corruption Strategy, accompanying Action Plan and inter-agency cooperation at national and local level. One of the results of the twinning component from this project is:
“One general information flow protocol for USKOK prepared – the protocol for exchange of the information set up between the USKOK, Tax Administration, State Audit Office, the Ministry of Interior, Central State Office for Administration, the Ministry of Economy, Labour and Entrepreneurship (Public Procurement System Department) and Customs Administration”.This project is planned to start in March 2010 and end in March 2012.
IPA 2008 “Strengthening of Tax Administration in the fight against corruption”
Strengthening accountability and transparency of work in the Croatian Tax Administration and raising the efficiency with regard to detection and prosecution of corruptive offences. The project is planned to start in the 3Q of 2010.
IPA 2008 “Strengthening capacities to remedy irregularities in public procurement procedures”
This twinning light project is aimed to detect elements in implementing public procurement procedures submissive to irregularities, including fraud and corruption, to recommend steps for improvement of response to detected irregularities and to raise public awareness on preventing, detecting and response to irregularities. The project is planned to start in the 3Q of 2010.
National policies and activities regarding fight against corruption
The Republic of Croatia initiated its strategic approach to the corruption issue in 2002 by adoption of the National Anti Corruption Programme with Action Plan. Considering that this Programme has not been implemented in a satisfactory measure in 2006 a new Anti Corruption Programme 2006-2008 has been adopted. In implementation of this Programme a development of institutional framework in state administration bodies has started with task to specialise these bodies in fight against different appearances of corruption.
Upon finalisation of implementation of the Anticorruption Programme 2006-2008, the Government decided to initiate development of multi-annual Anti Corruption Strategy and related Action Plan that were adopted in June 2008. For development of new Strategy an Anti Corruption Programme 2006-2008 has been analysed in terms of implemented measures as well as priority areas on which suppression of corruption needs to be focused.Experiences gained in implementation of previous programmes were directly integrated in Anti Corruption Strategy and related Action plan in the way that each measure represents a correction of perceived shortcomings of the previous Programme. In that way the institutional framework has been accordingly strengthened to allow more efficient interagency cooperation and civil society (NGOs) became more involved in suppression of corruption.
3.3Results:
- Gaps and Needs (G&N) Analysis carried out on the existing CCA system for fight against corruption and on integrity and transparency, including concrete recommendations on necessary improvements, elaborated and approved for further use during the rest of the project.
- CCA Anti Corruption Programme and its Implementation Plan evaluated and revised in line with the national Anti Corruption Strategy and related Action Plan and best EU and international (WCO[1]) standards.
- Guidelines on the working methodology on combating corruption drafted and approved by the CCA.
- A number of CCA staff (approx. 60) trained on relevant methods and procedures on preventingand combating corruption in line with the EU standards.
3.4Activities:
Activities related to result 1:
1.1. Carry out site visits, workshops and studies in order to asses the existing CCA anticorruption systemin view of organisation, national anticorruption policies[2], the CCA internal anticorruption policies and activities and possible types and extent of the corruption
1.2.Elaborate the first draft of the G&N Analysis
1.3. Performworkshop with the CCA staff on discussion and evaluation of the first draft of the G&N Analysis.
1.4. Analysis of the feedback from the workshop, revision of the draft of the G&N Analysis
1.5. Delivery of the final G&N Analysis
Activities related to result 2:
2.1. Provide recommendations on improvement of CCA Anticorruption Programme and its Implementation Plan taking into account national Anti Corruption Strategy and related Action Plan adopted in 2008
2.2. Draft the first version of revised Anti Corruption Programme and its Implementation Plan on the base of the evaluation findings and recommendations on improvements.
2.3. Workshop with the CCA staff with discussion and evaluation of the first draft of the revised Anticorruption programme and its Implementation Plan.
2.4. Analyse feedback from the workshop and accordingly modify the draft of the revised Anti Corruption Programme and its Implementation Plan
2.5. Delivery of revised Anti Corruption Programme and its Implementation Plan.