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Rule of Law

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Fraud dominates investigations at the Asian Development Bank 

By | Human Rights, International Organisations, Rule of Law, United Nations | No Comments

The Office of Anticorruption and Integrity at the Asian Development Bank has just released a pie-chart that provides valuable insight into the focus of its ongoing investigations into sanctionable practices. The key takeaway from the chart is that fraud, running at three quarters of all investigations over the last ten months, overwhelmingly makes up the largest slice of the investigative pie and corruption is the smallest slice at only two percent.

These ADB figures for 2018 are generally consistent with long term trends across the MDBs where corruption cases may grab the headlines but in the vast majority of instances it is fraud that lies at the core of most of the enforcement action brought by their integrity offices.

One question thrown up by the figures for corporates bidding on MDB funded projects to consider is whether they are matching this fraud risk with an equal proportion of their compliance efforts. Neil Macaulay, Co-Head of Chambers at Bretton Woods Law, believes there is a danger that the scale and nature of the risk of committing fraud can easily be underestimated by corporates when setting up their anti-bribery and corruption programs. Given that the base sanction for fraud and corruption violations are the same, with a three-year debarment start point, this could be a costly misjudgement.

MDB investigators routinely focus on procurement frauds as they are generally more widespread and easier to identify and prove than other sanctionable practices such as corrupt bribe payments, which by their nature are more likely to be concealed. Typically, an MDB procurement fraud, known as a misrepresentation, might involve misconduct through a wide range of means including; failure to declare an agent or commission payments, embellished c.v. qualifications or performance track record, forged bid securities, false invoicing and mis-description of joint venture responsibilities. This list is by no means exhaustive and misrepresentations can occur at all stages of the bidding and contract execution processes and the misstatement usually appears on the face of the available project records, which help to explain why fraud carries the greatest risk of debarment and sanction in MDB funded projects.

The Inaugural World Bank Group Sanctions System Annual Report FY18 Reveals a Sharp Rise in Settlements

By | Human Rights, International Organisations, Rule of Law, United Nations | No Comments

The World Bank Group (WBG) has published for the first time a joint report showing the key figures for debarments, cross-debarments and referrals made in the FY2018 under the WBG Sanctions System. The report collates the figures for sanctions, in particular the number and length of debarments, imposed through the means of settlements with the Integrity Vice Presidency (INT), determinations by the Suspension and Debarment Officer (SDO) and the decisions of the Sanctions Board. In addition, the report also contains figures for the last five years that reveal the increasing use of settlements to deal with fraud, corruption, collusion and obstruction infractions under the Bank’s Sanctions System.

Sanction settlements have multiplied from just seven to thirty-nine cases per year between 2014 and 2018, whilst the number of sanctions issued through the SDO’s determinations have fallen over the same period from forty-five to twenty-four cases. Disposals by the Sanctions Board have remained fairly constant over the five-year period with an increase of just one to twenty cases.

Neil Macaulay, Co-Head of Chambers at Bretton Woods Law, believes the continuing sharp increase in settlements over the last year may be readily explained since the vast majority of the shortest periods of debarment have been imposed through negotiated settlements. In other words settlements have become more attractive to those entities facing the sanctions process as the periods of debarment being negotiated with INT are increasingly considered acceptable.

The report helps to puts some statistical flesh on the bones. Of the twenty-nine cases with the shortest periods of debarment, those from one year and six months and below, only one was a result of a determination of the SDO, four emanate from the Sanctions Board and twenty-four were achieved by negotiation settlement with INT.
Significantly these lower penalty settlements also include five cases of ‘conditional non-debarment’ which permit the entities concerned to remain eligible for World Bank funded work provided they engage in remedial integrity compliance work. The growing attractiveness of settlements and the arrival of a new Vice President at INT, Pascale Dubois, is likely to be more than co-incidental, as she is keen to express in the report the benefits of settling sanctions matters in terms of the saving of resources and certainty of outcome for both the investigated party and the WBG.

Those companies that self-report misconduct receive particular praise from Dubois in the following terms:
“For example, two INT cases this year led to settlements with a sanction of ‘conditional non-debarment’ which means the sanctioned company remains eligible to participate in WBG-financed projects as long as it complies with certain obligations. This incentivises good corporate behavior as the companies in these cases came forward voluntarily and disclosed their misconduct. This approach also enables the type of responsible corporate citizens the Bank wants on its projects to continue to be eligible to contribute to the Bank’s mission.”

Ms. Dubois’ plainly incentive words regarding self-reporting appear to be backed up by the reported figures. All five of the cases listed as resolved by conditional non-debarment were arrived at through settlement with INT.

By stark contrast nearly all the cases resulting in the longest periods of debarment emanate from either the Sanctions Board or the SDO. Of the thirty-one most severe sanctions awarded, upwards from three years to ten and a half years debarment, only three arise from settlements and the bulk are divided between the Sanctions Board with nine disposals and the SDO with nineteen.

Overall the WBG report is to be commended as it provides a welcome degree of transparency into the current trends in disposals of sanctions cases by the three distinct limbs that comprise of the WBG Sanctions System and points towards the likelihood of a more favourable debarment outcome through settlement than the alternatives, even taking into account the additional co-operation requirements INT may require under a settlement. It therefore enables those who may be subject to an investigation by INT to make a more informed approach as to the relative merits of settling the case early or running through the SDO/Sanctions Board process.

Any companies, directors, consultants or individuals requiring assistance in dealing with the WBG Sanctions System are welcome to contact the experts in the BWL MDB Team through enquiries@brettonwoodslaw.com

Access The full WBG report >

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Bretton Woods Law holds a Staff Rights Workshop in Vienna

By | Human Rights, International Organisations, Rule of Law, United Nations | No Comments

On Friday 14th September, Ludovica Moro of Bretton Woods Law delivered a one-day workshop to the Staff Council of the United Nations Office in Vienna (“UNOV”). The attendees included staff representatives and employees of the United Nations Office on Drugs and Crime (“UNODC”) and of the International Atomic Energy Agency (“IAEA”).

The workshop focussed upon the latest changes within the United Nations’ internal justice system regarding UN salaries and entitlements. Of particular interest was the relevant recent jurisprudence of the Dispute Tribunal (“UNDT”) and Appeals Tribunal (“UNAT”) in the cases of Mirella et al. v SG, 2018-UNAT-842 and Lloret Alcaniz et al. v SG, 2018-UNAT-840.

The workshop considered the change in the approach of the UNAT judges with respect to the first tier judgments of the UNDT alongside other landmark cases regarding staff acquired rights. The discussion also included a comparison of the tests applicable to distinguish fundamental rights of employment from non-essential rights at the International Labour Organisation Administrative Tribunal (“ILOAT”), the World Bank Administrative Tribunal (“WBAT”) and the influence of these tribunal decisions on the UNAT judgments. The interactive discussion also included the new UN compensation package and the Global Service Delivery Model for the UN Secretariat. Ludovica addressed various strategies available to staff associations in conducting meaningful negotiations with management on staff rights and for the coordination of effective class actions.

Finally, the workshop concluded with a practical exercise on how to deal with the most recurring staff complaints from a staff representative’s perspective.

Ludovica and the Bretton Woods Law International Administrative Law (IAL) team have recently signed a Memorandum of Understanding with the Staff Associations of the IAEA, UNODC and UNIDO to assist with the delivery of our expert legal services in the Vienna area.

Any International Organisation Staff Association or Staff Union wishing to enquire how the BWL IAL Team can assist them in providing advice, representation or a bespoke workshop is welcome to contact us through enquiries@brettonwoodslaw.com in the first instance.

UNICEF

Enhancing Children’s Rights in South Asia

By | Human Rights, International Organisations, Rule of Law, United Nations | No Comments

Whilst attending Law Asia’s Annual Conference in Colombo, Sri Lanka last summer, BWL’s Counsel, Rule of Law and Human Rights expert, Antje Kunst, met with the Rainbow Foundation Baddegama, an NGO which works with children with disabilities, their parents, as well as children in care, with the aim of creating opportunities for peer support. Through the Head of that NGO, Antje had the pleasure of getting to know a respected Buddhist monk who is engaged with such issues. The trio came up with the idea of bringing Janis McDavid, a young German student and motivational speaker who was born without arms and legs, to Sri Lanka.

Their goal was to change the perception of Sri Lankans towards children with disabilities and to advance their rights under international law, including the UN Convention of the Rights of the Child. The timing could not have been better, as Sri Lanka had just ratified the UN Convention on the Rights of Persons with Disabilities (UNCRPD)[1]

A few months later the team was joined by Lalith Ganhewa, a Sri Lankan radio journalist and producer from Berlin and the President of Lanka Help e.V. Deutschland, a humanitarian organisation helping inter alia persons with disabilities in Sri Lanka. After months of hard work involving civil society (e.g., NGOs, academia, media, business etc.), the government of the Southern Province and members of the diplomatic and donor community in Sri Lanka, a tour was organised. In December 2016 and January 2017, Janis delivered motivational speeches to Government officials, NGO representatives, youth leaders, university students, business leaders and other citizens, some senior officials within Embassies and the UN, as well as conducting interviews with the media.  The tour, in respect of which Antje played a crucial coordination, communication and planning role, was very successful.

In March 2017, a second tour took place and Janis provided a motivational speech before the Sri Lankan business community at a Rotary district conference. This time Antje, a former Senior Legal Adviser at the UN, was, together with UNDP Sri Lanka, involved in organising a motivational session in front of the staff of all UN Agencies, including their adolescent children.

The two tours motivated and helped raise awareness in mainstream Sri Lankan society as well as the UN and the diplomatic community in Sri Lanka, of matters important for the implementation of the UNCRPD and the UNCRC, including the importance of inclusive education and parenting.

To ensure the realization of the rights of children during adolescence, in December of last year the UN’s Committee on the Rights of the Child published a new General Comment [2] providing guidance to States on the necessary measures. The Committee stated “the potential of adolescents is widely compromised because States parties do not recognize or invest in the measures needed for them to enjoy their rights.” UNICEF South Asia’s goal to promote investment by state parties in the 340 Million adolescents in South Asia prompted the Deputy Head of the Regional Office South Asia to invite Janis to a conference held in May 2017 in Nepal. Janis opened the conference, which was attended by senior officials of all UNICEF South Asia’s country offices, with a keynote motivational speech which Antje helped to prepare, covering the topics of investment in, and fulfilment of, children’s rights, including in adolescence, leaving no child behind. His speech, which was widely disseminated in the social media and which was also addressed to the young people of South Asia, was focused on motivating that group to advocate for the realization of their rights.

Janis’ successful appearance in Nepal prompted the UNICEF Bangladesh country office to follow suit. In July 2017 Janis delivered motivational speeches to UNICEF’s HQ and field staff in and near Dhaka, the aim of which was to drive the achievement of results by its staff, including by ensuring the the fulfilment of rights of children. He also spoke to around 100 adolescent club members in the Mirpur slum with a view to enhancing their motivation to work as social change agents, which was supported by UNICEF.

The advancement of human rights, in particular of the most vulnerable members of society, i.e. children and young adults, including those with disabilities, requires a committed government machinery, supported by a motivated UN staff (e.g., of UNICEF), as well as motivated rights’ holders, e.g., the millions of adolescents and children and their caregivers in South Asia. Antje’s pro-bono work in South Asia was aimed at contributing positively to this noble endeavour.

Antje is very grateful to all those who helped to make this ambitious project a success, in particular to Martin Henrich – Rainbow Foundation Baddegama; Samitha Baddegama Thero; Lalith Ganheva – Lanka Help e.V. Deutschland; Zahabia Adamaly; Lasanthi Senarath Attanayake & colleagues, Kelaniya University and the International Centre for Ethnic Studies; Rakitha Karunaratne and his team, German Goethe Institute Sri Lanka; Senake Amerasinghe – former Rotary District Governor and his team; Banthe Devananda; Una Macauley, Dilupa Fernando and their team at UNDP Sri Lanka; Philippe Cori and his team at UNICEF Regional Office for South Asia; Sara Bordas Eddy and her team at UNICEF Bangladesh Country Office; and of course, Janis McDavid.

 

[1] The purpose of the convention is to promote, and protect the full and equal enjoyment of all human rights and fundamental freedoms by all persons with disabilities.

[2] General Comments provide authoritative interpretations of children’s rights under the Convention.

 

Antje Kunst

Counsel, Rule of Law and Human Rights Expert

antjekunst@brettonwoodslaw.com

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The EU Court’s Grand Chamber supports equality and the rule of law in EU Missions

By | IAL, International Administrative Law, News, Rule of Law | No Comments

In a long awaited judgment the Grand Chamber of the Court of Justice of the European Union (‘CJEU’) found on appeal that it has jurisdiction in an employment dispute brought by an Italian magistrate who was seconded by her government to the CDSP mission in Bosnia Herzegovina.

In the Case C‑455/14 P H vs. Council of the European Union and the European Commission and the European Union Police Mission (EUPM) in Bosnia and Herzegovina the claimant brought a legal suit before the EU General Court seeking the annulment of a re-deployment decision adopted by the Head of the EUPM and compensation for harm suffered as a result of alleged psychological harassment.

In an earlier decision refusing the claim the EU General Court ruled on 10 July 2014 in H v Council and Others (T‑271/10) that it lacked jurisdiction since the contested decisions fell within the EU’s Common Foreign Security Policy (‘CFSP’) and relied upon provisions that set out that the CJEU shall not have jurisdiction over provisions relating to the CFSP norwith respect to acts adopted on the basis of those provisions.

The Grand Chamber ruling on 19th July 2016 found that pursuant to the aforementioned provisions, the CJEU does not, in principle, have jurisdiction on the provisions of, or acts adopted under, the CSFP. The Court then observed that the European Union was founded, in particular, on the values of equality and the rule of law stating:

“The very existence of effective judicial review designed to ensure compliance with provisions of EU law is inherent in the existence of the rule of law”.

Whilst the ruling acknowledged that the contested decisions were admittedly set in the context of the CFSP it added that this does not necessarily exclude the jurisdiction of the EU judicature. The Grand Chamber then referred to the fact that the EU judicature had jurisdiction to rule on all actions brought by EU staff members having been seconded to the EUPM. It noted that staff members seconded by the Member States and those seconded by the EU institutions were subject to the same rules so far as concerns the performance of their duties ‘at theatre level’.

Indeed, the decisions adopted by the authorities of that mission, which related to the allocation of human resources assigned to it by the EU institutions and Member States, did have an operational element, which fell within the CFSP. However, by their very essence, they also constitute acts of staff management. Consequently, it was held that the jurisdiction of the EU judicature should not be excluded from reviewing acts of staff management that relate to staff members seconded by the Member States.

Finally the Grand Chamber held that the contested decisions were only imputable to the Council and that, accordingly, the action was admissible only in so far as it was directed against the Council. The case was referred back to the General Court for judgment on the substance of the action.

The Grand Chamber’s judgment is very welcome news for more than 1500 staff who currently serve with CSDP missions, in some of the most dangerous parts of the world. It is an important step towards bringing missions under judicial scrutiny, thus achieving greater legal accountability. It is expected that the case-law of the CJEU will also serve as an important tool for policy change and as guidance for human resources officials in CSDP missions, seconding institutions and employees serving in CSDP missions alike.

In conclusion, the Grand Chamber has made an important ruling by permitting effective judicial review of staff management decisions by a CSDP mission, thusensuring compliance with EU law, including the EU Charter, and bringing a welcome boost to the morale of staff upon whom the success of such missions ultimately depends.

View full decision >

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An anti-corruption training course for staff working in peace operations in a post conflict environment

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As part of its Rule of Law services Bretton Woods Law offers an anti-corruption training course for staff working in peace operations in a post conflict environment.

Corruption can seriously hamper efforts to establish governance and restore rule of law in post-conflict countries. While some level of corruption is a common feature in many societies, it can have a devastating effect on a peace mission’s reform efforts in particular in the area of rule of law and can put the entire mission at risk.

Frequently host countries emerging from conflict have high or endemic corruption. Corruption is often both a cause and a consequence of conflict, and effectively addressing it is key for post-conflict state building and the re-establishment of the rule of law in which missions are involved.

Peace operations in post-conflict countries have rarely addressed corruption as a priority focusing instead on more pressing issues such as establishing peace and security. We believe one of the more serious risks in post-conflict which should be addressed is corruption, due to its negative effects on power distribution and longer-term stabilization and ultimately on a mission’s impact and its credibility in the host country.

The deployment of a mission involves major flows of resources and funds, very often without adequate accountability mechanisms, and those key resources are particularly susceptible to corruption and staff need to understand corruption risks within mission operations and arising from it.

A better knowledge and understanding by mission staff of corruption risks and anti-corruption in respect of the host country they support and the mission they work for is central to the success of peace operations.

The training course is offered at two levels, one is introductory providing participants a useful and essential overview of corruption risks and anti-corruption tools in a post-conflict context.  The intermediate level training course is designed for those working on host government support and in particular rule of law assistance with a special focus on the UN Convention against Corruption (UNCAC).

The trainers are experienced practitioners in anti-corruption, rule of law and post-conflict environments. They include the Head of BWL Rule of Law Team and BWL’s Lead Counsel Lee Marler who used to be the Director of Operations of the World Bank Group’s Anti-Corruption office and Chief of International Law of UNRWA, BWL’s Lead Counsel Neil Macaulay, a former Senior Prosecutor within the U.K. Revenue and Customs Prosecution office and Antje Kunst, Senior Counsel and former senior legal adviser with UN peace operations.

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Marler Mentioned in Dispatches

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A former UK Chief of the Defence Staff has singled out BWL’s Lee Marler for praise. Lord Richards of Hertsmonceux (formerly General Sir David Richards) in his recently published, serialised and best selling autobiography titled Taking Command (Headline Publishing Group (2014) ISBN 97814722 20844) writes at page 110 as follows:

“Another key player [in East Timor in 1999] was Lieutenant Colonel Lee Marler of the Army Legal Corps, who was my operational lawyer. Modern Generals need to have in their back pockets not the sapper and gunner of tradition, but a media man and a lawyer. If you haven’t got those cards in your deck, you’re lost. The Australians soon realised that they needed to put the new country of East Timor on a legal footing but they didn’t have anyone within their military with that background. I had someone in Lee Marler. In the month or so that we were in East Timor, he worked all hours to draft a new constitution. He deserves huge credit for what he did. He based it on the international laws of war and it served as a transitional structure while a new long-term constitution was drafted, which the UN did the following year. The Australians did not much like the fact that my lawyer had done it but took it on the chin, generously giving Lee many plaudits when he left. Since leaving the Army, Marler has become a successful barrister with his own chambers.”

Chambers congratulates Lee on this public recognition for his Rule of Law work.

Lee heads up the BWL Rule of Law and IHL Teams and can be contacted at leemarler@brettonwoodslaw.com.

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Curbing Illicit Financial Flows

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Curbing Illicit Financial Flows from the African continent/U.S.-Africa Summit

African states and the U.S. agreed at their recent summit to establish a high-level working group to address the losses suffered by the African continent from illicit financial flows and corruption. African leaders demanded that the world’s richest nations strengthen their laws against money laundering, tax havens and tax evasion in order to tackle corruption and illicit flows from the African continent. G7 countries are creating opportunities for those who loot African countries. In many countries the volume
of financial outflows exceeds the inflows of aid due to corruption, money laundering and tax evasion.

Global Finance Integrity highlightes the role of the United States as a major facilitator of such outflows stating that the United States was the second easiest country in the world—after Kenya—for a kleptocrat to incorporate a shell company to launder ill-gotten-gains.

There was also a demand that the complex tax structures multinational corporations use to minimize their tax burdens be addressed.

At the summit it was also discussed to support African countries in negotiating fair natural resources contracts with multinationals through expert technical assistance. Many countries of the African continent although rich in natural resources are the poorest of the world. Getting such contracts right is key.

rule_of_law_aftrican_states

Immunity for Crimes Committed by African Heads of State

By | Corruption, Human Rights, News, Rule of Law, Uncategorized | No Comments

The BWL Rule of Law Team notes with ever increasing concern that at its Assembly in late June 2014 in Malabo, Equatorial Guinea, the African Union (“AU”) adopted the Protocol on Amendments to the Protocol on the Statute of the African Court of Justice and Human Rights (“the Second Protocol”) and called upon its member states to sign and ratify the treaty “as expeditiously as possible so as to enable [it] to enter into force.” [Click to see a copy of the relevant AU Decision] Readers will recall that the First Protocol for the establishment of the African Court of Justice and Human Rights (“the ACJHR”) was adopted by the AU in Sharm El-Sheikh, Egypt on 1st July 2008.

The ACJHR; the main purpose of which is to function as the principal judicial organ of the AU, is intended to have jurisdiction over both civil and criminal cases, including matters presently within the jurisdiction of the International Criminal Court (“ICC”) in The Hague, such as genocide, war crimes and crimes against humanity. But unlike the ICC, it is intended that the ACJHR will also have jurisdiction over transnational crimes, such as money-laundering, human and drug trafficking, terrorism and piracy. The difficulty is that the ACJHR’s constituent treaty, as adopted and advanced by the AU, contains a clause granting immunity from prosecution to sitting heads of state.

Like many others, members of the BWL Rule of Law Team are troubled by the existence of the immunity, for it undermines fundamentally the Rule of Law principle that ‘no one is above the law’ and that ‘all are accountable to the law,’ including those individuals who represent the State’s guiding mind and will. Lee Marler, the barrister who leads the BWL Rule of Law Team, is quoted as saying that “one cannot help but wonder whether the suggested immunity from ACJHR prosecution for African Heads of State – which is indefensible – is as a result of the ICC’s indictments of Sudan’s Omar al-Bashir and Kenya’s Uhuru Kenyatta.” Neil Macaulay, another senior member of the BWL Team, sees the merits of establishing the ACJHR, despite the overlapping jurisdiction of the ICC, but “is concerned that the existence of the immunity from prosecution will undermine from the very outset the Court’s credibility and may put international funding of the Court at risk.”

Steps to establish the ACJHR will not take place until 15 AU states have ratified the Court’s treaty. Until such time as the Court has the ability to prosecute all those responsible for atrocities and crimes within Africa, it is to be hoped that AU States will respect the Rule of Law and resist the AU’s call to ratify the treaty in its presently flawed state.

american_film_inst

Second Take – BWL Congratulates One of its Own

By | News, Rule of Law, Uncategorized | No Comments

Aside from being a talented young international barrister, BWL’s Joseph Oppenheimer is also a budding film writer and director with a number of short documentaries and films under his belt.  Joseph directed to some acclaim the documentary Checkpoint, which explored the sensitive issue of Palestinian freedom of movement in the West Bank in the Middle East and most recently he wrote and directed the short film Lion in the Tent.  It was this last production that brought Joseph to the attention of the American Film Institute, which has offered him a scholarship to its prestigious two-year directing course in Los Angeles, California.  Joseph of course accepted the AFI’s offer and all within BWL are delighted for him.  Joseph will be on sabbatical from August 2014.

Joseph is a member of BWL’s Rule of Law and International Humanitarian Law Teams.