In the past period, there has been a lack of criminal accountability for corruption in public procurement. It is essential to strengthen the capacities of institutions for detecting and prosecuting corruption in this area, as specialised knowledge is needed to address this complex issue. People within the system need to be motivated to report suspicions of corruption.
These are some of the conclusions from our panel discussion “Corruption in Public Procurement – Why is There No Criminal Accountability?”. During the panel, data collected by Institute Alternative were presented, covering a period of seven and a half years and relating to the activities of the police, prosecution, and judiciary.
From 2016 to July 2023, the Police Administration (UP) handled 31 cases related to public procurement, but only submitted one criminal report to the prosecution – according to data collected by Institute Alternative. Dragana Jaćimović, a public policy researcher at Institute Alternative, stated that the data show that the efforts of institutions to prosecute corruption in public procurement are very limited.
“The Agency for Prevention of Corruption (ASK) has submitted five criminal reports. Three cases are ongoing, while two have been dismissed with the notification that no criminal offense was committed,” Jaćimović emphasised.
According to the data from the Supreme State Prosecutor’s Office, based on ASK’s reports, seven cases have been formed, with five under the jurisdiction of the Special State Prosecutor’s Office (SDT) and one each at the Basic State Prosecutor’s Offices in Podgorica and Herceg Novi.
On the other hand, according to media reports, three criminal reports have been submitted to the SDT by other reporters, while one case was initiated by the SDT on its own initiative concerning the procurement of the ferry “Prizna.” The SDT has dismissed two criminal reports.
Two acquittals have been delivered in cases related to public procurement. The Basic Court in Podgorica issued one acquittal for a procurement from 2013 – abuse of official position in an attempt, and dismissed the case against the former mayor of Nikšić where it was determined that there was no evidence of abuse of official position – according to data collected by Institute Alternative.
Jaćimović highlighted that during the specified period in Montenegro, over 3.5 billion euros were contracted through public procurement.
“Although public procurement is a high-risk area for corruption, the data we have show a lack of criminal accountability for corruption in public procurement,” concluded Jaćimović.
She noted that since December 2023, Montenegrin legislation includes the criminal offense of abuse related to public procurement.
“However, since the introduction of the new criminal offense, the police have handled two cases but have not filed criminal reports, while the Supreme State Prosecutor’s Office records show no data on criminal reports related to the new criminal offense,” said Jaćimović, adding that training for the new criminal offense is not planned by the Training Center for the Judiciary and State Prosecutors for this year.
Vučina Keković, the Chief Police Inspector in the Sector for the Fight Against Crime at the Police Administration (UP), said that a major problem is the lack of personnel.
“In the Department for Combating Corruption, Economic Crime, and Conducting Financial Investigations, there are 60 positions, of which less than 50 percent are filled. A major problem is that a large number of colleagues will retire in the next two years. In the past period, there was a wrong personnel policy, and currently, there is no staff for economic crime. This is an issue that needs to be resolved. These are the basic problems for detecting corruption, not only in public procurement but also in all other sectors,” explained Keković.
Keković believes that corruption in public procurement is a highly provable offense if investigated before the tender is realised. “In the area of public procurement, I worked directly on two cases and must say that neither case was realised. We have a clear picture that everything was rigged, but we had no mechanism to prove the specific criminal offense. With these capacities, we are very limited,” added Keković.
“We need to prove corrupt actions, and this can be proven during the tender process if we have the staffing capacities and a sufficient number of quality inspectors. We are open to direct communication, and if any citizens, institutions, NGOs, or media have information, they should report and share it with us as soon as it is known. We cannot function without joint work with the Tax Administration and the Customs and Revenue Administration. There would be more results if that cooperation were stronger, especially in the area of tax evasion and public procurement,” concluded Keković.
State Prosecutor at the Special State Prosecutor’s Office (SDT) Vukas Radonjić stated that the SDT is responsible for prosecuting public officials or, in cases of organised crime, and that all other cases fall under the jurisdiction of the basic state prosecutor’s offices.
“Criminal offenses related to public procurement are such that it is difficult for the state prosecutor to prosecute them ex officio. If the authorities that should control the process (Inspection Administration, Commission for Protection of Rights in Public Procurement Procedures) do not reveal questionable actions to us, it is hard to expect the prosecutor’s office to get involved unless citizens or media uncover corrupt activities,” said Radonjić.
“We need people who are familiar with public procurement procedures, which also involves cooperation with other bodies in Montenegro and abroad. We must establish teams at the national and international levels. We need to set a different standard of proof. Simply put, in corruption cases, we must broaden the standard of proof,” emphasised the state prosecutor.
Regarding acquittals, he mentioned that one reason making confirmation difficult is that it is still hard to prove corruption in public procurement and due to the way courts assess evidence. “The police and inspection authorities must play a significant role in detecting corrupt actions. We cannot expect better results until public awareness of the seriousness of these criminal offenses is raised,” Radonjić concluded.
Jelena Jovetić, Director General of the Directorate for Public Investment Management and Public Procurement Policy at the Ministry of Finance (MF), stated that for 2023, there are over 630 million euros in public procurement and that efforts are being made to reduce the space for corruption through the introduction of European standards.
“The data are complex, making it difficult to implement control mechanisms. From the MF’s perspective, it is important to implement public procurement effectively. There is a preparatory phase, the tender, and contract conclusion. We unevenly devote attention to these phases. I point out that there is limited investment in personnel dealing with public procurement. You have one official handling public procurement and a number of controllers,” emphasised Jovetić.
She added that from the Ministry of Finance’s perspective, they appreciate that the new criminal offense of abuse in public procurement has been recognised. “It is crucial to clarify that if tender documentation is not adequately completed, it is not a criminal offense, but an infraction subject to an appeal procedure. This criminal offense is more oriented towards economic entities, sending the message that misuse of public procurement can be controlled,” she noted.
She particularly highlighted the usefulness of the electronic public procurement system where all data are published. “These data can be accessed by both the police and the prosecutor’s office. It is important to believe that the public is the best controller. If we consider public procurement to be procedurally correct and free of corrupt activities, any action taken afterward is a delayed response,” concluded Jovetić.
Stevo Muk, President of the Managing Board of Institute Alternative, pointed out that specialised knowledge is needed to deal with this complex issue and that people within the system need to be motivated to report suspicions of corruption.
“What is much more important than the preparatory actions in tenders is the contract execution phase, where we have huge problems and where corruption is realised through non-execution, partial execution, or execution contrary to standards. In that phase, we should have all the possibilities that we lack in the previous ones: written evidence of execution, in the form required for some economic forensic examination, and what should be confirmed by the procurement implementation report,” added Muk.
This panel was organised within the Project “Procurement under spotlight – Making Watchdogs Work!”, with the support of the Embassy of the Kingdom of the Netherlands in Serbia and Montenegro within the MATRA Rule of Law programme. Project aims to empower and motivate watchdogs to combat corruption and undue influence in public procurement.
