58. What sanctions are provided for political finance infractions?

Greco Eval III Rep _2011_ 1E Final Ukraine PF PUBLIC

General funding of political parties

The LPP and the tax legislation provide for several types of measures and sanctions on political parties themselves, as outlined below. As concerns individual party members or officials, the authorities indicate that they may be held liable on the basis of party statutes, for violation of the statutes, or if they commit offences defined by the Criminal Code or other legislative acts, e.g. embezzlement . a) Section 20 LPP: Warning A warning notice is to be issued by the relevant controlling authority against an unlawful activity which has been publicly announced by the leadership of a political party, together with an instruction to correct the transgression (unless the act entails other kinds of responsibility). The leadership of the party has to promptly correct the transgression and, within five days, notify the authority of the measures taken. Furthermore, a party can be dissolved by court decision in case of violation of the requirements as to the formation and activity of political parties33 but it was explained on site that this sanction does not apply to violations of financing regulations. b) Section 15 LPP: Transfer of funds to the State budget Funds of political parties which derive from illicit sources listed in this section (e.g. from public entities, except in cases envisaged by the law, from foreign or anonymous persons)34 are to be transferred by the party concerned to the State budget or seized by a court of law for the benefit of the State. The banks have to notify the Ministry of Justice of any entries of such prohibited funds on party accounts. 33 Section 21 LPP. 34 See paragraph 33 above. 18 c) Tax legislation: Deregistration, fines - If a party violates provisions of the tax legislation or financing regulations provided by other laws, e.g. by using funds exempt from taxation for carrying out business activities or by accepting funds from illegal sources, the tax inspectorate of the locality where the party is registered can decide to remove the party from the Register of Non-Profit Organisations, resulting in the loss by the party of its non-profit status and in its submission to the common taxation regime (which implies an obligation to pay corporate profit tax, other taxes and mandatory charges).35 - In addition, the tax legislation provides for other sanctions for infringements of tax regulations, in particular fines, including in cases of late or non-submission of tax reports (170 UAH / approximately 16 EUR).36 Funding of election campaigns 68. a) Section 64 LParlE, section 56 LPresE and section 45 LLocE: Warning and cancellation of registration A warning can be issued by the CEC or the TEC (in local elections) to an electoral subject for violation of specified regulations of the election laws, including the use of funding sources other than election funds (and funds from the State budget). The registration of an electoral subject can be cancelled by the CEC or TEC in parliamentary or local elections but not in presidential elections in the case of repeated violation of election legislation (i.e. the same kind of infringement) in respect of which a warning has been previously issued. In the case of parliamentary elections, such a decision can be taken not later than three days before the ballot and in local elections, not later than 10 p.m. on the day preceding the election. b) Section 159.1 of the Criminal Code: Criminal sanctions - Provision of gross financial (material) aid to the election campaign of a candidate or political party/bloc in violation of the pertinent rules, through provision of funds or material values free of charge or at unreasonably low prices, production or dissemination of campaign materials which have not been paid for from the election fund or paid for at unreasonably low prices, or payment for the production and dissemination of such materials, and - deliberate use by a candidate, political party/bloc, their authorised representative, trustee of the candidate or an authorised person, of gross financial (material) support to the election campaign in violation of the pertinent rules are punishable by a fine ranging from 1,700 to 5,100 UAH / approximately 156 to 468 EUR, or corrective work for a period of up to two years, or limitation of freedom for up to two years, or imprisonment for the same period. A note to section 159.1 of the Criminal Code indicates that the amount, values or advantages are considered to be gross if they exceed 400 monthly minimum wages (376,400 UAH / approximately 34,630 EUR). Where the above-mentioned acts are committed in a planned and concerted manner (collusion), the penalty is imprisonment for five to ten years. Such criminal sanctions can only be imposed on individual persons. 35 Paragraph 5.1. of the Regulation on the Register of Non-Profit Organisations and Institutions, approved by STA Order No. 232 of 7 November 1997. 36 Section 17 of the Law on the Procedure of Liquidation of Taxpayers’ Obligations to Budgets and State Funds. 19 c) Section 212.15 of the Code of Administrative Offences: Fines - Violations of the pertinent rules on the provision of financial (material) support to an election campaign, provided such violations have no criminal component, entail a fine ranging from 850 to 1190 UAH / approximately 78 to 109 EUR for citizens and from 1,190 to 1,700 UAH / approximately 109 to 156 EUR for officials. Such administrative sanctions can only be imposed on individual persons (i.e. donors)