Ministers' Deputies
    Notes on the Agenda

    CM/Notes/835/10.2 4 April 2003
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    835 Meeting, 8 April 2003
    10 Legal questions


    10.2 Financing of political parties

    a. Draft Recommendation Rec(2003)… of the Committee of Ministers to member states on common rules against corruption in the funding of political parties and electoral campaigns

    b. Recommendation 1516 (2001) of the Parliamentary Assembly on financing of political parties – Supplementary Draft reply

    Reference documents
    CM(2001)195revised, REC_1516 (2001), GR-J (2003)7, CM/AS(2003)Rec1516 prov.

    Item prepared by the GR-J
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    Action

    1. To adopt draft Recommendation Rec(2003)… of the Committee of Ministers to member states on common rules against corruption in the funding of political parties and electoral campaigns;

    2. To adopt a supplementary reply to Recommendation 1516 (2001) of the Parliamentary Assembly on financing of political parties.

    a. Draft Recommendation Rec(2003)… of the Committee of Ministers to member states on common rules against corruption in the funding of political parties and electoral campaigns

    1. Laws governing political party funding are often recent or incomplete. At present, there is no international standard or reference, the question of political party financing being closely linked to the constitutional and electoral systems of each State, which are themselves generally the product of each country's historical or cultural background.

    2. At their 2nd Summit, the Heads of State and Government of the member States of the Council of Europe instructed, inter alia, the Committee of Ministers to secure the rapid completion of international legal instruments pursuant to the Council of Europe's Programme of Action against Corruption, adopted in 1996. As this Programme referred to the links between the illegal financing of political parties and corruption, the Multidisciplinary Group on Corruption (GMC) examined the possibility of drafting international rules on the fight against corruption in the funding of political parties and election campaigns. The GMC started its work by elaborating a comparative analysis of the legislation in place in Council of Europe member states and observer states.

    3. On the basis of that analysis, the GMC decided in December 1999 to create a special working group on the funding of political parties (GMCF). It was agreed that this group would consider the elaboration of common principles with regard to the funding of political parties, candidates and election campaigns, the aim being to prevent corruption. The GMCF working group met five times (April, June, October, December 2000 and March 2001) to consider and finalise a draft Recommendation of the Committee of Ministers. The draft was submitted to the GMC plenary for consideration in March 2001.

    4. The GMC took into account Recommendation 1516 (2001) of the Parliamentary Assembly on Financing of Political Parties (adopted on 22 May 2001) and prepared the draft recommendation at its 23rd (March 2001), 24th (May 2001) and 25th (October 2001) plenary meetings when it approved and transmitted it to the Committee of Ministers for adoption.

    5. In May 2002, the Committee of Ministers held a preliminary exchange of views and instructed its Rapporteur Group on legal co-operation (GR-J) to pursue examination of this draft Recommendation with a view to finding solutions to the concerns expressed by some delegations.

    6. The GR-J debated this issue at its meetings in May 2002 (see synopsis GR-J(2002)CB5), June 2002 (see synopsis GR-J(2002)CB6) – which included a hearing with Ms Stepova, rapporteur of Parliamentary Assembly Recommendations 1516 (2002) - September 2002 (see synopsis GR-J(2002)CB7 revised), and November 2002 (see synopsis GR-J(2002)CB9) – with participation of experts from the capitals. At the close of this latter meeting, the GR-J instructed the Secretariat to prepare a compromise proposal in the light of the views expressed by delegations.

    7. Following this conclusion, the Secretariat analysed the different points of view, undertook consultations and prepared some draft amendments. The proposed amendments are reflected in a new version of the Recommendation which is reproduced in an Appendix to document GR-J(2003)7. The amendments follow a more flexible approach than the original text, notably with regard to the requirement of legislation and with the setting of limits for donations and expenditure. Their aim is to cater for the concerns expressed by a number of delegations during the examination of this draft. The GR-J examined the revised draft at a meeting held on 21 March 2003 and agreed to submit it to the Deputies for adoption.

    8. At their 833rd meeting (26 March 2003, item 10.2), the Deputies decided to resume consideration of this item at their 835th meeting (8 April 2003). Several delegations thanked the Secretariat for its efforts in trying to elaborate a compromise proposal that would be acceptable to all delegations having expressed concern in the past. However, several delegations stated that they were not in a position to agree on a text as they had not yet received their final instructions. Since the 833rd meeting of the Deputies, the draft recommendation has been checked by the Editorial Service. The Deputies are invited to resume consideration of the draft.

    b. Recommendation 1516 (2001) of the Parliamentary Assembly on financing of political parties – Draft reply

    9. Recommendation 1516 (2001) on financing of political parties was adopted by the Parliamentary on 22 May 2001. At their 756th meeting (12-14 June 2001), the Deputies took note of it. On this occasion, they decided to transmit the Recommendation to the Multidisciplinary Group on Corruption (GMC), in order that it be taken into account in its work and invited the GMC to finalise the draft Recommendation to member states on common rules against corruption in the funding of political parties and electoral campaigns.

    10. They agreed to resume consideration of the Assembly Recommendation at a later stage in the light of the results of the work of the GMC and a draft reply to be prepared by the Secretariat. At their 808th meeting on 18 September 2002 (item 10.7), the Deputies adopted a first reply to the Assembly Recommendation, indicating inter alia that the Rapporteur Group on Legal Co-operation was currently examining the draft Recommendation prepared by the GMC and that the Deputies would inform the Assembly of future developments in this area and would communicate the Recommendation to the Assembly as soon as it had been adopted.

    11. Consequently, the Deputies may wish to make a supplementary reply to Recommendation 1516 (2001), by transmitting to the Parliamentary Assembly Recommendation Rec(2003)… of the Committee of Ministers to member states on common rules against corruption in the funding of political parties and electoral campaigns.

    Financing assured: YES

    DRAFT DECISIONS

    835th meeting – 8 April 2003

    Item 10.2

    Financing of political parties

    a. Draft Recommendation Rec(2003)… of the Committee of Ministers to member states on common rules against corruption in the funding of political parties and electoral campaigns
    (CM(2001)195revised, GR-J (2003)7)

    Decision

    The Deputies adopted Recommendation Rec(2003)… of the Committee of Ministers to member states on common rules against corruption in the funding of political parties and electoral campaigns, as it appears at Appendix … to the present volume of Decisions. [see the Appendix to the present Notes]

    b. Recommendation 1516 (2001) of the Parliamentary Assembly on financing of political parties - Supplementary Draft reply
    (REC_1516 (2001), GR-J (2003)7, CM/AS(2003)Rec1516 prov.)

    Decision

    The Deputies adopted the supplementary reply to Parliamentary Assembly Recommendation 1516 (2001) on financing of political parties, as it appears at Appendix … to the present volume of Decisions.1

    Appendix
    (Item 10.2)

    Recommendation Rec(2003) …
    of the Committee of Ministers to member states
    on common rules against corruption in the funding of political parties and electoral campaigns

    (Adopted by the Committee of Ministers on …
    at the …th meeting of the Ministers' Deputies)

    The Committee of Ministers, under the terms of Article 15.b of the Statute of the Council of Europe,

    Considering that the aim of the Council of Europe is to achieve a greater unity between its members;

    Considering that political parties are a fundamental element of the democratic systems of states and are an essential tool of expression of the political will of citizens;

    Considering that political parties and electoral campaigns funding in all states should be subject to standards in order to prevent and fight against the phenomenon of corruption;

    Convinced that corruption represents a serious threat to the rule of law, democracy, human rights, equity and social justice, that it hinders economic development, endangers the stability of democratic institutions and undermines the moral foundations of society;

    Having regard to the recommendations adopted at the 19th and 21st Conferences of European Ministers of Justice (Valetta, 1994 and Prague, 1997 respectively);

Having regard to the Programme of Action against Corruption adopted by the Committee of Ministers in 1996;

    In accordance with the Final Declaration and the Plan of Action adopted by the Heads of State and Government of the Council of Europe at their Second Summit, held in Strasbourg on 10 and 11 October 1997;

    Having regard to Resolution (97) 24 on the twenty guiding principles for the fight against corruption, adopted by the Committee of Ministers on 6 November 1997 and in particular Principle 15, which promotes rules for the financing of political parties and election campaigns which deter corruption;

    Having regard to Recommendation 1516 (2001) on the financing of political parties, adopted on 22 May 2001 by the Council of Europe's Parliamentary Assembly;

    In the light of the conclusions of the 3rd European Conference of Specialised Services in the Fight against Corruption on the subject of Trading in Influence and Illegal Financing of Political Parties held in Madrid from 28 to 30 October 1998;

    Recalling in this respect the importance of the participation of non-member states in the Council of Europe's activities against corruption and welcoming their valuable contribution to the implementation of the Programme of Action against Corruption;

    Having regard to Resolution (98) 7 authorising the Partial and Enlarged Agreement establishing the Group of States against Corruption (GRECO) and Resolution (99) 5 establishing the Group of States against Corruption (GRECO), which aims at improving the capacity of its members to fight corruption by following up compliance with their undertakings in this field;

    Convinced that raising public awareness on the issues of prevention and fight against corruption in the field of funding of political parties is essential to the good functioning of democratic institutions,

    Recommends that the governments of member states adopt, in their national legal systems, rules against corruption in the funding of political parties and electoral campaigns which are inspired by the common rules reproduced in the appendix to this recommendation, – in so far as states do not already have particular laws, procedures or systems that provide effective and well-functioning alternatives, and instructs the "Group of States against Corruption – GRECO" to monitor the implementation of this recommendation.

    Appendix

    Common rules against corruption in the funding of political parties and electoral campaigns

    I. External sources of funding of political parties

    Article 1 – Public and private support to political parties

    The state and its citizens are both entitled to support political parties.

    The state should provide support to political parties. State support should be limited to reasonable contributions. State support may be financial.

    Objective, fair and reasonable criteria should be applied regarding the distribution of state support.

    States should ensure that any support from the state and/or citizens does not interfere with the independence of political parties.

    Article 2 – Definition of donation to a political party

    Donation means any deliberate act to bestow advantage, economic or otherwise, on a political party.

    Article 3 – General principles on donations

    a. Measures taken by states governing donations to political parties should provide specific rules to:

    – avoid conflicts of interests;

    – ensure transparency of donations and avoid secret donations;

    – avoid prejudice to the activities of political parties;

    – ensure the independence of political parties.

    b. States should:

    i. provide that donations to political parties are made public, in particular, donations exceeding a fixed ceiling;
    ii. consider the possibility of introducing rules limiting the value of donations to political parties;
    iii. adopt measures to prevent established ceilings from being circumvented.

    Article 4 – Tax deductibility of donations

    Fiscal legislation may allow tax deductibility of donations to political parties. Such tax deductibility should be limited.

    Article 5 – Donations by legal entities

    a. In addition to the general principles on donations, states should provide:

    i. that donations from legal entities to political parties are registered in the books and accounts of the legal entities; and

    ii. that shareholders or any other individual member of the legal entity be informed of donations.

    b. States should take measures aimed at limiting, prohibiting or otherwise strictly regulating donations from legal entities which provide goods or services for any public administration.

    c. States should prohibit legal entities under the control of the State or of other public authorities from making donations to political parties.

    Article 6 – Donations to entities connected with a political party

    Rules concerning donations to political parties, with the exception of those concerning tax deductibility referred to in Article 4, should also apply, as appropriate, to all entities which are related, directly or indirectly, to a political party or are otherwise under the control of a political party.

    Article 7 – Donations from foreign donors

    States should specifically limit, prohibit or otherwise strictly regulate donations from foreign donors.

    II. Sources of funding of candidates for elections and elected officials

    Article 8 – Application of funding rules to candidates for elections and elected representatives

    The rules regarding funding of political parties should apply mutatis mutandis to:

    – the funding of electoral campaigns of candidates for elections;

    – the funding of political activities of elected representatives.

    III. Electoral campaign expenditure

    Article 9 – Limits on expenditure

    States should adopt measures to prevent excessive funding needs of political parties, such as, establishing limits on expenditure on electoral campaigns.

    Article 10 – Records of expenditure

    States should require particular records to be kept of all expenditure, direct and indirect, on electoral campaigns in respect of each political party, each list of candidates and each candidate.

    IV. Transparency

    Article 11 – Accounts

    States should require political parties and the entities connected with political parties mentioned in Article 6 to keep proper books and accounts. The accounts of political parties should be consolidated to include, as appropriate, the accounts of the entities mentioned in Article 6.

    Article 12 – Records of donations

    a. States should require the accounts of a political party to specify all donations received by the party, including the nature and value of each donation.

    b. In case of donations over a certain value, donors should be identified in the records.

    Article 13 – Obligation to present and make public accounts

    a. States should require political parties to present the accounts referred to in Article 11 regularly, and at least annually, to the independent authority referred to in Article 14.

    b. States should require political parties regularly, and at least annually, to make public the accounts referred to in Article 11 or as a minimum a summary of those accounts, including the information required in Article 10, as appropriate, and in Article 12.

    V. Supervision

    Article 14 – Independent monitoring

    a. States should provide for independent monitoring in respect of the funding of political parties and electoral campaigns.

    b. The independent monitoring should include supervision over the accounts of political parties and the expenses involved in election campaigns as well as their presentation and publication.

    Article 15 – Specialised personnel

    States should promote the specialisation of the judiciary, police or other personnel in the fight against illegal funding of political parties and electoral campaigns.

    VI. Sanctions

    Article 16 – Sanctions

    States should require the infringement of rules concerning the funding of political parties and electoral campaigns to be subject to effective, proportionate and dissuasive sanctions.

Note 1 See also CM/AS(2003)Rec1516prov.


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