On May 4, 2022, the Verkhovna Rada registered draft law No. 7348 "On Amendments to the Criminal Code of Ukraine on Strengthening Liability for Corrupt Actions During Martial Law", the purpose of which is to significantly strengthen sanctions for illegal enrichment in the relevant period. The project proposes the introduction of an additional sign to the disposition of Art. 111 of the Criminal Code of Ukraine "Treason" and the qualification of illegal enrichment during the period of martial law and within a year after its termination or cancellation as treason.
As you know, according to Art. 111 of the Criminal Code of Ukraine, an act intentionally committed by a citizen of Ukraine to the detriment of the sovereignty, territorial integrity and inviolability, defense capability, state, economic or informational security of Ukraine is recognized as treason, including committed under the conditions of martial law: switching to the enemy's side during an armed conflict, espionage, providing assistance to a foreign state, a foreign organization or their representatives in carrying out subversive activities against Ukraine.
It should be noted that the responsibility for illegal enrichment is already provided for in Art. 368-5 of the Criminal Code of Ukraine, which was introduced into the Criminal Code by the Law of Ukraine "On Amendments to Certain Legislative Acts of Ukraine Regarding Confiscation of Illegal Assets of Persons Authorized to Perform Functions of the State or Local Self-Government and Punishment for Acquisition of Such Assets" No. 263-IX of October 31 .2019. The current version of this article was developed taking into account the conclusions of the Constitutional Court of Ukraine dated 26.02.2019 No. 1-р/2019 in case No. 1-135/2018(5846/17) on the constitutional submission of 59 People's Deputies of Ukraine regarding compliance Constitution of Ukraine (constitutionality) Art. 368-2 of the Criminal Code of Ukraine, by which the norm on illegal enrichment was previously recognized as inconsistent with the Constitution.
According to Art. 368-5 of the Criminal Code of Ukraine, the acquisition by a person authorized to perform the functions of the state or local self-government of assets, the value of which exceeds his legal income by more than 6,500 non-taxable minimum incomes of citizens, is punishable by imprisonment for a term of 5 to 10 years with deprivation of the right to hold certain positions or engage in certain activities for a period of up to 3 years. Draft Law No. 7348 proposes to supplement Art. 111 of the Criminal Code of Ukraine, part 3, according to which during the period of martial law and during the year after its termination or cancellation, illegal enrichment, i.e. the acquisition by a person authorized to perform the functions of the state or local self-government, assets the value of which is more than 6,500 tax-free minimum incomes of citizens exceeds her legal income, constitutes treason and is punishable by imprisonment for a term of up to 15 years or life imprisonment with confiscation of property and deprivation of the right to hold certain positions or engage in certain activities.
Note to the specified Part 3 of Art. 111 of the Criminal Code of Ukraine is similar in content to the note to the current Article. 368-5 of the Criminal Code of Ukraine and defines as the persons authorized to perform the functions of the state or local self-government those specified in Clause 1 Part 1 of Art. 3 of the Law of Ukraine "On Prevention of Corruption". The acquisition of assets in the Note means their acquisition by a person authorized to perform the functions of the state or local self-government, as well as the acquisition of assets into the property by another natural or legal entity, if it is proven that such acquisition was carried out on behalf of the person authorized to perform the functions of the state or local self-government, or that a person authorized to perform the functions of the state or local self-government can directly or indirectly perform actions with respect to such assets that are identical in content to the exercise of the right to dispose of them.
Assets are monetary funds (including cash, funds held in bank accounts or kept in banks or other financial institutions), other property, property rights, intangible assets, including cryptocurrencies, the amount of reduction of financial obligations, as well as work or services provided to a person authorized to perform the functions of the state or local self-government.
The legal income of a person means the income lawfully received from legal sources, in particular those specified in Clauses 7 and 8 of Part 1 of Article 46 of the Law of Ukraine "On Prevention of Corruption".
When determining the difference between the value of acquired assets and legal income, assets that are the subject of proceedings in cases of recognition of assets as unfounded and their collection into state income, as well as assets collected into state income as part of such proceedings, are not taken into account.
Calculated in accordance with the rules provided for in Clause 5 of Subsection 1 of Chapter XX, Clauses 169.1.1 clause 169.1 of Art. 169 of Chapter IV of the Criminal Code of Ukraine, the threshold amount of illegal enrichment according to project No. 7348 is currently UAH 8,063,250.
The idea of qualifying illegal enrichment as treason is not new and has already been declared by Ukrainian politicians. Thus, as early as 2009, the chairman of the Verkhovna Rada of Ukraine emphasized [1] that equating corruption crimes with treason is one of the priority obstacles to eradicating corruption in Ukraine, and this should be "fixed at the legislative level with appropriate punishment for such actions."
In this regard, the explanatory note to draft law No. 7348 contains quite emotional and vivid wording: "… Corruptors in war are worse than looters, because by choosing their purse, they actually work on the side of the aggressor. Therefore, there is an urgent need to intensify the struggle on this front as well, especially since after the victory, Ukraine will receive billions in funding from partners for the revival of the economy and infrastructure. And at the word "financing" the worst part of the state apparatus has an unhealthy gleam in the eyes and new offshore accounts. …The only option to prevent the "watering down" of international aid during wartime and after victory is to strike pre-emptively, equating wartime corruption with collaboration with the enemy."
In general, it is difficult to disagree with the justification given in the explanatory note to project No. 7348 for the adoption of the draft law, but there are some nuances. In particular, the key provision of the draft law — equating illegal enrichment with treason due to its commission during martial law and in the post-war period — raises many questions from the point of view of law-making technique, because these criminal offenses have different objects (the procedure for payment of labor established by law, distribution of material goods and financing of official activities of persons authorized to perform the functions of the state or local self-government according to Article 368-5 of the Criminal Code of Ukraine, public relations in the sphere of protection of external and internal security of Ukraine according to Article 111 of the Criminal Code of Ukraine).
It is also a distinguishing feature of a criminal offense under Art. 111 of the Criminal Code of Ukraine usually recognizes the purpose of committing treason, in particular causing damage to the sovereignty, territorial integrity and inviolability, defense capability, state, economic or informational security of Ukraine, while illegal enrichment according to Art. 368-5 of the Criminal Code of Ukraine in its content is limited exclusively to self-interest and is characterized by the purpose of acquiring assets of illegal origin.
As of May 5, 2022, the draft law has been submitted to the Committee on Law Enforcement of the Verkhovna Rada of Ukraine. We are waiting for his position and the conclusion of the Main Legal Department of the Parliament.