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COMPARATIVE STADIES JURISPRUDENCE (12.00.00)
CORRUPTION AS A WAY OF BUSINESS INFLUENCE ON LEGISLATIVE PROCESS*
DOI: http://dx.doi.org/10.14420/en.2016.1.1
Svetlana Vladimirovna Boshno, Doctor of Legal Sciences, Professor, President of Consulting and Legal Protection of People Foundation, email: boshno@yandex.ru.
Private entrepreneurs and state authorities inevitably get into some kind of interactions. Relations between private and public structures can be either legal or illegal. Corruption is an example of illegal collaboration. Bodies of legislative power represented by deputies and senators appear as attractive figures for businesspersons who want to increase their income by means of introducing certain legislative amendments. Corruption has many forms: direct bribery of members of parliament, appointment to specific posts on completing the public career, planting representatives of business structures into state authorities so that they can provide insider information, etc. The author views lobbyism as a method that businesses use to influence the law-making process. Legalisation and establishment of distinct legal boundaries for lobbyist activities decreases the level of corruption in legislative authorities. members of parliament, parliamentarism, deputies, senators, parliamentary ethics, bribery, lobbyism, corruption, parachuting, nepotism, conflict of interests.
Subject of Research: relations between business structures
Object of Research: social and legal norms regulating business — legislators' interaction and the practices of its realization.
Data base for analysis and sources
Information about members and deputies (sex, age, experience, etc.) provided by official websites of the Federation Council and the State Duma of the Federal Assembly of the Russian Federation.
Svetlana Boshno,
Abstract.
Keywords:
and legislators
* Translated by Bibichkova Svetlana.
Data about income of MPs for comparative analysis of wages and other income.
Data about blatantly lobbied laws. For example, criminal lobby results in decriminalization of the Criminal Code, reduction of sanctions and abolition of confiscation practices. Commercial lobby results in establishing self-regulating organizations, insuring motor vehicle liability. For instance, public blatantly antisocial lobby has reflected in passing laws about country amnesty, fighting corruption, prohibiting relative networking, establishing police, canceling licensing, implementing national income declaration and monitization of benefits.
Normative legal acts regulating the interaction of business, civil society and members of parliament in legislative process.
Resource of juridical information "Consultant Plus" containing normative legal acts, court practice documents and comments on legislation.
Scientific literature on law-making, legislative process, formation of a group of legislators and lobbyism, corruption, civil society, access to the state bodies work information.
Objective: to suggest models of reducing corruption in legislative process Tasks:
- to study international experience of legalizing lobbyism
- to detect problem spots in legislative process, that is bribery and manipulation of interests
- to define governmental bodies controlling lobbyism or its absence, implementing the monitoring of legislation impartiality
- to establish judicial processes on corruption in legislation by analyzing court practice
- to find possible ways of influence of foreign companies on Russian legislative process and check if it does not contradict to Russian national interests
- to establish a degree of transparency, access to information
- to distinguish between lobbyism and corruption
- to develop ways of revealing corruption in legislative process
- to work out ways of legal and socially useful interaction of civil society institutes, business structures and legislators.
Hypothesis of scientific research: established ways of business structures influence on MPs are divided between legal (lobbyism, etc.) and illegal (corruption, etc.) .
In this context "legal ways" does not mean socially useful. Legal models include:
- businessmen become legislators to promote their commercial interests
- businessmen are made legislators to legally finance party needs
- business delegates into legislators by bribing certain groups of people to promote their interests
- business finances legislators spending including legislation
- business gives money for certain projects of legislators (polls, for example)
- business appears to be involved in legislative process but, in fact, just promotes itself
- business attacks mass media to feel its way for legislation
- establishing council of experts with assistance of politics in business structures
- service clubs (Valdai Club, Yaroslavl hearings, etc.) representing local interests and club methods of "aristocratic" power
- officials membership (including legislators) in boards of trustees and other councils
- pay through lectures, speeches, VIP visits on certain events Illegal models of influence include:
- direct vote-buying of deputies
- corporate membership "business structure" is political party GAZPROM (also other state enterprises) represent their interests by financing expert projects, etc.
- giving government agreement to certain interest groups
- promising to legislators a business or post in a company after retiring
- well-paid projects involving legislators
- terrorism as business (restriction of human rights)
The subject is a burning issue as today in Russia for every 100 000 people of Russian population nearly 12 corruption crimes are registered. It tells us more about the efficiency of law-enforcement agencies work and divergences in attitude towards corruption of legislators, officials and population, — than of the extent of the situation.
The unregistered number of corrupt crimes, according to experts, in the end of the 80ies was 10 times higher than the registered one1. According to our poll of experts from the law-enforcement agencies dealing with economic crimes (126 participants) made in 1992, latency coefficient of the most common kind of corruption (bribery) was 18 facts on each 100 000 people of population. However, in 1995 this level of latent bribing was estimated by the same group of experts in the index exceeding 20002.
As a rule, no more than 20% of people caught taking bribes is convicted to any of the punishments under the criminal law including imprisonment. Even for taking bribes under aggravated and even highly aggravated circumstances less than a half of convicted was sentenced to imprisonment until recently3. Hardly this phenomenon can be rationally explained especially considering the imprisonment having been the only way of punishment for bribery. Nevertheless, it cannot be ignored that a significant part of cases for bribery was connected to the need of imposing a penalty for taking really small sums of money equivalent to
1 S. B. Borodin Combatting Crime: Theoretical Model of a Complex Program.— Moscow, 1990. Page 60
2 Crime in Russ: Analytic Review.— Moscow, 1997. Page 7
3 Crime and Law Infringement.— Moscow, 1993. Page 163
2-5$. Quite often it is this circumstance that makes judges impose a punishment below the inferior limit stated by law for giving or taking bribes. It also makes them apply a lighter penalty than the criminal law prescribes. The same judge has to inflict practically similar punishment for taking big sums of money.
The forms of corruption in the system of public and municipal service of different countries are quite similar:
- nepotism in recruiting system
- sponsorship of political campaigns
- rewards for profitable contracts (rakes-off)
- abuse of official position
- taking money for services which are listed as public servants official duties (recommending for generalship, getting a vacation on summer time)
- rakes-off for favouring a certain enterprise with a public order (construction of buildings, roads, communications, purchase of PCs and cars for officials, etc.)
- according excessive hospitality and other courtesies by businessmen (for example, providing children of officials with scholarships for studying abroad, etc.)
- civil servants' patronage of certain governmental contracts either through some front organizations or so called "partners", or directly by «consulting»
- sending "themselves" on foreign business trips with arbitrarily fixed per diem expenses
- political parties abusing their influence (present or future) for gathering «voluntary donations» from businessmen in exchange for placing governmental orders (it can be exposed as contributions to «charity funds» or aid to orphan homes)
- latent extortion by officers of rating and custom authorities from exporters and importers through importunate demonstration of their power to define arbitrarily the tax rate under the limits imposed by law
- «public road racketeering», that is extortion by officers of the entities ensuring traffic safety threatening drivers to impose a fine for sometimes imaginary violation of highway code (moreover, the sum of a bribe is usually smaller than a fine)
- blackmailing illegal awards for faster delivery of documents or decisionmaking (for example, issuing of driving license, passport or providing a marketplace)
- weekly or monthly rakes-off for superiors from their subordinates in a fixed amount for further delivery «upwards»
Anti-corruption measures are now being implemented in several directions. The most obvious is a vector for reducing such crimes. Nevertheless, corruption detention, eradication of its conditions and premises are even more important.
In this research the object is the analysis of regulatory legal acts for signs of corruption. In fact, a juridical text itself supposes corruption practices. Strict
criteria for exposing corruption in the texts of regulatory legal acts are need to be developed. There is a strict need for guidelines and other scientific and organizational tools for a proper anti-corruption analysis.
The factors breeding corruption are numerous and appear in different fields. Political conditions are the most important. Social, economic and juridical ones are also quite significant.
Political Conditions of Corruption
- multilevel administrative structure
- regional authorities have regulative and law-enforcement powers in most strands of policy
- local favoritism and take-over of law-enforcement procedures
- insufficiency of the checks and balances system under law-enforcement procedures
- insufficient judicial control
- total and excessive regulating
Political reason for corruption may become a seizure of parliament. In such cases practically all most important for business laws are passed by legislative bodies. There exist several ways of seizing a representative body.
Direct bribing of deputies. In exchange for material benefits an official obliges to vote in a way he was told.
Internal Lobbyism. It suggests that corporations, alliances and unions participate directly in parliamentary elections acting as electoral machinery. Financing all or greater part of election campaign business groups get rubber-stamping fractions voting in a proper way. Another kind of internal lobbyism is direct election of a businessman in representative bodies.
«Parachuting» is «deferred corruption». A deputy obliges to vote for certain draft laws in some business groups' interest in exchange for well-paid prestigious job on the expiry of his deputy authority.
A seizure of executive power can be a quantitative method of corruption. The main condition of this method is a weak parliament. Most decisions are made by the executive branch of power. Decision-making process in executive bodies is closed and not formalized in any public rules. Corrupted officials of these institutes proceed from group interests.
The examples of the executive power seizure are the cases of tax exemptions under tax legislation of the 90ies XX century. For instance, the Decree1 of the President of the Russian Federation May 18, 1995 № 496. According to it, the enterprises of the Russian air consortium collected benefits and tax deferral. The Decree of the President of the Russian Federation December 24, 1993 № 2486 gave benefits to «Automobile Russian Alliance», Company Limited.
Another way of corrupting executive bodies is the activities of «attached», similar to internal lobbyist in parliament mentioned above. «Business sends to federal bodies people mainly for lobbying. It is clear, they are not recruited
Here presidential power is considered as executive one
on rank positions. Such public servants do not worry about material problems getting real wages from the structures they lobby. These «recruits» do not even need company vehicle. All included»1.
Both in the 1st and 2nd cases the reason of corruption of the laws is an active position of the interest groups. According to the theory of rentooriented behaviour, interest groups exist for redistribution of economic goods in favor of their members spending resources for obtaining exclusive rights and benefits. Why do groups of interest exert corrupt influence on the rules of law?
The answer to the question lies in a detailed analysis of economic mechanism of the interest groups formation and functioning made by Mankur Olsen2. The American researcher concluded that these groups emerge not because a potential member of a group shares its goals and, therefore, wants to join it. On the contrary, as membership demands certain charges and the work of a group has significant external positive effects (for those who share goals, but have not joined it), a person is rationally expected to act as a free-rider. According to Mr. Olsen, an individual speculates this way: «the benefit from the group work will inevitably come, so why am I to join it incurring expenses?».
Consequently, to form a group potential members should be explained that they will benefit only after having joined the group. Mr. Olsen calls it providing selective motivation. In other words, to overcome the issue of «a free-rider», a group should divide benefiting from implementing certain interest inside it and allocate expenses among the whole society. Thereby, any interest group will be oriented more on redistribution of economic goods than on their creation.
On the whole, we can conclude that corruption crimes are an integral, relatively massive complex of crimes encroaching the authority and other legal public interest, public, municipal service, work in commercial and non-commercial organizations. It reflects in goods being obtained illegally by people empowered to carry out public functions or in such people provided with these goods.
Economic factors. It is generally acknowledged that the root of corruption is poverty. If it were the only reason for corruption, it would be difficult to explain why it strikes both countries with population strictly divided into two unequal groups of poor and rich and those counties where this line is blurred. Despite the total ownership equality of the overwhelming majority of population, the Soviet Union had never been free of corruption. Neither are free those states which are trying to create more effective patterns of socialism today. Nevertheless, the population differentiation according to income has an impact on social strain, economic consistency and corruption respectively. An outstanding social inequality makes the growth of corruption more probable. Therefore, corruption may be regarded as a reason of poverty, not consequence.
The poverty mainly causes so-called local corruption (casual).
1 The Main Point in the Administrative Reform. Report FBK. Pages 9-10
2 M. Olsen Logic of Common Action. Moscow,1995.
Economic constraints of federal budget are partly reflected in the failure to pay officials wages which guarantee a decent way of life. Nevertheless, it is clear that attaining an absolute balance between the level of public servants wages and economic equivalent of their powers is impossible. So how much should the budget manager or a judge empowered to sentence criminals to life imprisonment be paid? Another question is if honesty, duty and the country service can be measured in money. Such approach is meaningless as these qualities cannot be evaluated in money.
The analysis of most modern researches on the subject shows that economic inconsistency is a decisive impetus for corruption. It appears during uncontrollable inflation volatilities which urge officials to seek any sources of income. Inconsistency and small wages predetermine the growth of corruption regardless of its direction: economic boom may be accompanied by the same raise of corruption as recession.
Political factors. The human history shows much evidence that there is an objective connection between the anxious desire to have power and getting benefits from it. The lack of personal interest of public servant is practically unimaginable. Such practices, unfortunately, are common for dictatorships as well as democracies.
No form of public administration can manage without keeping the majority or minority of population away from power, especially from estate administration, legislation, law-enforcement. It is just impossible. One of the most attractive ideas of communism (and anarchism) — everybody can administrate public affairs — in the beginning of the XXI century seems even more like utopia than it did at the beginning of the XX century. The standing necessity of such estrangement will make a citizen dependent on a public servant again and again. The most efficient patterns of solving this problem through modern information technologies (IT) are still not well-developed. One thing is evident: the number of those who administer money and property should decrease.
For modern Russia the following thins are typical:
- a high degree of inconsistency of political system on all levels. It cultivates a slighting attitude of public and municipal servants towards their duties, but cannot be overcome with the help of political will only;
- a lack of effective political mechanism, which would make unfavourable including in the voting list public and municipal servants involved in corruption cases;
- «broken dreams» of legislative initiative bodies to be qualified for direct discharge of executive power officials who committed corruption offence from their office
- replacement of political will by political anti-corruption logos;
- occasional permeation of criminal societies' representatives into public bodies;
- still weak burgeons of revived non-state control over public and local bodies and their officials.
Legal factors. Modern law cannot exist without its executor. It needs interpreter and practitioner. It is mainly legislator's wisdom that maintaining an optimal level of legal regulations uncertainty depends on. It suggests law practitioner actions being easy to control, but legal regulations still direct the process.
Today the state of Russian legal system and its pace of development witness that its peak of uncertainty has not been reached. Law executor is omnipotent, he has a choice of law enforcement measure. Nowadays a court can sentence to 7-12 years of imprisonment for bribery on an especially large scale. It is not exclusively Russian practice. Even anti-corruption measures may be corruptive.
Uncertainty of the greater part of legal system is aggravated by the fact that Russian legislator usually avoids authentic interpretation of laws adopted by himself. He refers to the lack of legal grounds. Gaps and contradictions in legislation are premises of corruptive behaviour. These drawbacks are skillfully applied in bye-laws and court practice by interested parties.
Traditionally, the lack of legal definitions of corruption, corruption crime and other corruptive offences are considered as one of the main obstacles on the way to forming an effective anti-corruption mechanism. Nevertheless, this axiom has to be proved. Clear legal definitions, transparent juridical procedures, uniform patterns of law enforcement may really fight corruption.
Legislative definition of corruption is just a premise to identify and effectively control a corruptionist. Only the specification which exludes ambiguity and does not demand an «army» of interpreters may count.
Moral factors. It is quite difficult to fight corruption in a society which does not disapprove of it. Blaming corruption people (mostly deprived) often do not want to see it in themselves. In the society which is always ready for a bribe legal interdictions are dead. Conspiracy causes a high level of corruption resistance.
Psychological form of informative corruption plays an incredibly negative role in corruption cultivating. Two questions: «how often do you give or take bribes?» and «how often are you told that others do it?». Differences in answers to these questions provide a clear picture of the reality.
Today most of us are passive or active participants of a psychological experiment on exaggerating in social mind general corruptive character of the political machinery and imposing meaninglessness of individual anti-corruption actions. It is naive to see in this initiative vicious intentions of mass media (it is more likely just to reflect reality) .
One of the significant impetus for corruption in private sector is a «complex of state parasitism». A considerable number of banks, investment funds, foreign trade enterprises which emerged during privatization do not hurry to break off relations with budget resources. In this case, such enterprises will have to survive on their own money. Economically meaningless privileges have become a sort of drug without which they cannot function any more and such benefits can be obtained only by bribes.
* * *
To sum up, in modern political and legal as well as social and economic situation there exist all premises for legal and illegal influence on MPs. Legislative power is part of state system. Representative bodies bear all the drawbacks of bureaucracy, public service and state as a whole.
Библиографический список
1. Borodin S. B. Combatting Crime: Theoretical Model of a Complex Program. Moscow, 1990.
2. Boshno S. The stepwise algorithm of anti-corruption expertise for analysts not having special training and skills // Law and modern states. 2015. № 1.
3. Crime and Law Infringement. Moscow, 1993.
4. Crime in Russ: Analytic Review.Moscow, 1997.
5. Magomedov К. Lobbying in legislative proceedings: negative and positive aspects // Law and modern states. 2015. № 1.
6. Olsen M. Logic of Common Action. Moscow, 1995.
7. Sokolova N. Transformation of rules of legislative technique into anticorruption expertise // Law and modern states. 2015. № 2.
8. The Main Point in the Administrative Reform. Report FBK.
