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Directors of SOE outside the reach of anti-corruption regulations

The directors of the largest state-owned companies (SOE), which manage assets worth tens of billions of euros, will not have the obligations, restrictions or control provided for public officials in the Law on Prevention of Corruption if the deputies adopt the proposed Law on the Management of Companies Owned by the Republic of Serbia.

The law also does not restrict the advertising of these companies, which opens the door wide for unnecessary expenses, buying media influence and achieving other hidden goals unrelated to the role of state-owned companies.

Due to these and numerous other weaknesses, Transparency Serbia called on the MPs to obtain from the Agency for the Prevention of Corruption an opinion on assessing the risk of corruption in the Draft Law before considering it. TS called on the National Assembly to cancel the authentic interpretation of the Law on Prevention of Corruption from 2021. With that interpretation, the circle of officials was drastically reduced, as a result of which, after the adoption of the proposed Law on the Management of State-Owned Enterprises, members of their assemblies, presidents and members of supervisory boards, directors and acting directors will not have to report assets and income and conflicts of interest to the Agency.

Finally, TS, in its initiative, called on the competent parliamentary committees and deputies, if the Government does not withdraw the controversial Bill, to formulate amendments that would ensure that the level of protection against corruption in economic entities to which the Law on Public Enterprises is currently applied, at least not be at a lower level from the existing one.

In addition, and especially in the context of the expected elections, TS proposed prescribing additional measures that would reduce the possibility of abuse of state enterprises for political promotion or would facilitate the detection of such violations.

Among them is a proposal to provide public information on the use of certain resources of public companies during the election campaign (vehicles, means of communication) in order to be able to monitor whether they are used to an increased extent during the campaign period, to limit the level of employment during the campaign period and immediately after the election, as well as the execution of unplanned works aimed at obtaining the voters' favour (for example, the case of "Kukulovce").

The law does not give guarantees that one of the biggest problems so far – multi-year management of public companies by directors who were not selected in a competition, most often from "acting status", and often without determining whether the incumbents meet the requirements for being appointed to the head of the company.