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BBC Hardtalk clash highlights concerns over EU’s Romanian Prosecutor Laura Kovesi

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BBC Hardtalk’s Stephen Sackur is known for his robust interview style and his command of any subject he chooses to tackle. Observers in Bucharest, Brussels and across Europe watched with interest as he questioned Laura Kovesi, the European Union’s Chief Prosecutor, one year into her tenure in this new role. It seems widely acknowledged that she did not stand up well to his sharp interrogation when he quizzed her on her controversial track record in Romania.

The interview, which took place over video-conference with Kovesi on screen from her Luxembourg base, questioned whether Ms Kovesi had been successful in her previous role at the National Anti-Corruption Directorate (DNA) in Romania, but the biggest sting was delivered when Sackur accused Kovesi of having “pushed the envelope” in terms of the legality of her Romanian investigations.

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Sackur said to Kovesi: “People across Europe are going to be interested in how you're going to do the job and it is indeed notable that you had a certain reputation in Romania for let's say pushing the envelope in terms of investigative practice. You, it seems, were prepared to use the intelligence services in a covert fashion, to dig dirt on some of the suspects that you were going after and in the Romanian constitutional court some of your methods were called into question. Do you regret some of the methods you used?”

In fairness to Ms Kovesi it should be noted that she was not alone at the DNA. Other DNA prosecutors such as Nicolae Marin have also faced such allegations that would amount to “pushing the envelope”, to use Sackur’s phrase.  The difference, perhaps, is that Marin did not lose his job at the DNA, but rather remained and gained more power, remaining a part of the structure that the international community has referred to as Romania’s “parallel state” or “Securitate 2.0”.

Kovesi responded: “No it’s not about the methods, it's about working arrangements that we had but at that moment, based on the legislation, we received information from the secret services and we used that information to open the cases. But it's important to say and to clarify that our investigations were made by the prosecutors and by police officers and no one from the officials of the Secret Service worked on our cases - only the prosecutors, police officers.”

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Sackur was characteristically determined to press  Kovesi further, responding: “I'll be honest with you - I was very struck by a former Romanian Prime Minister Mr Tariceanu saying that under your watch the anti-corruption agency had not respected legal frameworks, had become corrupt themselves and had become a part of the political fight in Romania. Some critics called you a part of Securitate 2.0 because of your cooperation with the security services. Again I put it to you that if you bring those methods to your Europe-wide prosecutor role, you're going to make many people very unhappy?”

Kovesi answered: “All our cases that we worked on in Romania were checked and verified in the courts. So at the European level we will work according to the legislation as I did in Romania all the time and everything that the prosecutors did in the cases were checked in the court by judges.”

As ever, Sackur was unrelenting on his point, firing back: “But with respect, the constitutional court in January 2019 concluded that you had created a parallel justice system existing outside the rules imposed by Romania's constitution!”

Kovesi answered: “There is not any decision of the constitutional court saying that I created a parallel state in Romania.” One has to assume that all of the Brussels elite took a collective sharp intake of breath that an EU Prosecutor even needed to utter such a statement.

Sackur did not back down, going on to say: “Well I am reading from one of their rulings of January 2019. Now I know that ultimately charges against you were dropped but nonetheless it's a very serious allegation that you created a parallel justice system. The question really is do you believe that in prosecuting corruption and fraud the ends justify the means?”

Kovesi answered: “If you read that decision based on which the constitutional court absolved me I should say that I made a complaint with the European Court of Human Rights and in this year in May the judgment of the European Court of Human Rights said that in that case my rights were broken so I don't know which kind of decision you call it but I can say that in my entire activity I respected all the time the constitution I respected the procedural Criminal Code and all the national law.”

Sackur continued: “But when it comes to winning… I'm just asking you a simple question now… when it comes to rooting out corruption, do you believe as an aggressive prosecutor that the ends do justify the means?”

Kovesi then responded: “No, all the time in my activity I respected the law and this is the only principle that I will take into consideration and we should take into consideration all the time, to respect the law.”

This episode of Hardtalk was one of the most fascinating discussions on the show in recent times. One European Parliament insider commented: “It is somewhat bizarre that we are in this situation. There are those who feel that Romania joined the EU far too soon, that the country is sadly a long way off reaching any kind of European standard in terms of rule of law. Yet here we are with a European Prosecutor from Romania sitting in Luxembourg, who as Stephen Sackur said, some critics called part of Securitate 2.0 because of her alleged cooperation with the security services.”

EU law

Rule of law: MEPs press Commission to defend EU funds

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MEPs want the European Commission to prove it’s up to the task of defending the EU budget from member states violating the rule of law principle. EU affairs 

MEPs will discuss the application of the rules adopted in 2020 linking the disbursement of EU funds to member states respecting the rule of law and EU values during a plenary session in June.

Defending the rule of law: a matter of urgency

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During a meeting of Parliament’s budget and budgetary control committees on 26 May, MEPs discussed the way forward with Gert Jan Koopman, Director-General of the Commission's budget department.

Koopman emphasised the sensitive nature of potential Commission assessments regarding the rule of law in EU countries: “Decisions taken will be subject to full judicial review by the [European] Court of Justice," he said. "We need to get this right from the beginning. We simply cannot afford to make mistakes and bring cases that are annulled by the Court. This will be a disaster.”

The Commission is preparing guidelines explaining how it will implement the law. Koopman said that the Commission will consult Parliament on the guidelines in the first half of June.

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MEPs said that the regulation is already quite clear. “If one wanted to have a very short set of guidelines, one could just write in one sentence: ‘Take a look at the regulation',” said Petri Sarvamaa (EPP, Finland).

Still, Parliament will express an opinion on the guidelines in a report that is expected to be voted on in July. “All member states should be able to see that the Commission is doing its investigations in a truly objective manner,” said Sarvamaa.

“When we speak about violations of the rule of law, this is a very serious topic. We are aware of the fact that we need to be very scrupulous with these assessments. But this rigorousness and this meticulousness cannot postpone the application of the regulation forever,” said Eider Gardiazabal (S&D, Spain).

Other MEPs said there is a rule of law crisis in the EU and called on the Commission to act decisively to prevent further deterioration. Terry Reintke (Greens/EFA, Germany) said: “We have absolute trust in the Commission’s ability to monitor, find and assess cases. You have some of the smartest lawyers in Europe, you have the best civil servants to protect the EU budget and the rule of law.

“But the impression is, and I am speaking on behalf of millions of EU citizens, that you are lacking a certain sense of urgency. It feels like you are sitting in this burning house and you say: ’Before we call the fire brigade, we are actually going to come up with guidelines on how they can extinguish this fire’."

The EU budget and the rule of law

The legislation adopted at the end of 2020 made access to EU funds conditional on respect for the rule of law. If the Commission establishes that a country is in breach and that the EU's financial interests are threatened, it can propose that payments from the EU budget to that member state are either cut or frozen.

The Council has to take the decision by a qualified majority. The rules also seek to protect the interests of final beneficiaries - farmers, students, small businesses or NGOs - who should not be punished for the actions of governments.

Legal challenges

Parliament is keen to see the system implemented given concerns in recent years about the rule of law and democracy in some member states.

Hungary and Poland have brought cases before the European Court of Justice demanding that the regulation be annulled. In their meeting on 10-11 December 2020, EU leaders agreed that the Commission should prepare guidelines for the implementation of the rules that should be finalised after the ruling of the Court of Justice.

However, Parliament has insisted that the rules are in force and that the Commission has a legal duty to defend the EU’s interests and values.

Find out how the EU aims to protect the rule of law.

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EU law

Better Regulation: Joining forces to make better EU laws and to prepare for the future

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The Commission has adopted a Communication on Better Regulation, proposing several improvements to the EU law-making process. To foster Europe's recovery, it is more important than ever to legislate as efficiently as possible, while making EU laws better adapted to tomorrow's needs.

Interinstitutional Relations and Foresight Vice President Maroš Šefčovič (pictured) said: “The Commission already has one of the best Better Regulation systems in the world but we still need to do more. Therefore, we are stepping up efforts to simplify EU legislation and reduce its burden, while making better use of strategic foresight and supporting sustainability and digitalisation. To succeed, however, all stakeholders must work together on high-quality EU policymaking that will translate into a stronger, more resilient Europe.''

Cooperation among the EU institutions, with member states and stakeholders, including social partners, businesses and civil society, is key. To help face current and future challenges, the Commission has proposed the following actions:

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  • Removing obstacles and red tape that slow down investments and building of 21st century infrastructure, working with member states, regions and key stakeholders.
  • Simplifying public consultations by introducing a single ‘Call for Evidence', on the improved Have Your Say portal.
  • Introducing a ‘one in, one out' approach, to minimise burdens for citizens and businesses by paying special attention to the implications and costs of applying legislation, especially for small and medium-sized enterprises. This principle ensures that any newly introduced burdens are offset by removing equivalent burdens in the same policy area.
  • Mainstreaming the United Nations Sustainable Development Goals, to ensure that all legislative proposals contribute to the 2030 sustainable development agenda.
  • Improving the way in which Better Regulation addresses and supports sustainability and digital transformation.
  • Integrating strategic foresight into policymaking to ensure it is fit for the future, by for instance, taking into account emerging megatrends in the green, digital, geopolitical and socio-economic contexts.

Next steps

Better Regulation is a shared objective and responsibility of all EU institutions. We will reach out to the European Parliament and the Council regarding their efforts to assess and monitor the impact of EU legislation and EU spending programmes. In addition, we will cooperate more closely with local, regional and national authorities, and social partners on EU policymaking.

Some of the new elements of this Communication have already started in practice, such as the work of the Fit for Future Platform, which provides advice on ways to make EU legislation easier to comply with, efficient and fit for the future. Others will be implemented in the coming months. This year will see, among other things:

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  • The 2020 Annual Burden Survey, outlining the results of the Commission's burden reduction efforts.
  • The revised Better Regulation guidelines and toolbox to take into account the new elements of the Communication, providing concrete guidance to European Commission services when preparing new initiatives and proposals as well as when managing and evaluating existing

Background

The Commission carried out a stocktaking of its better regulation agenda in 2019, confirming that the system is broadly functioning well, while needing improvements to reflect experience.

The EU has a long history on evidence-based policymaking, including reducing regulatory burdens, starting in 2002. It includes regular evaluations of existing laws, a very advanced system of impact assessment, a top of the class stakeholders' consultation approach and a comprehensive burden reduction programme (REFIT).

For more information

The 2021 Better Regulation Communication

Q&A on the 2021 Better Regulation Communication

The 2019 Stocktaking exercise

The Better Regulation agenda

The law-making process in the EU

The Have Your Say portal

Fit for Future Platform

REFIT – making EU law simpler, less costly and future proof

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Ireland

Russian - Irish Business Council launches an inquiry into Russian businessman

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The Russian Irish Business Council has launched a broad inquiry into alleged illegal activities of Russian businessman Mr. Sergey Govyadin and his close associate Mr. Ildar Samiyev.

The Council, unifying companies working in the UK, EU and Russia, have sent a letter to HSBC and a number of other financial institutions in the UK requesting information the banks might have about Mr. Sergey Govyadin. It alleges that both he and Mr. Samiyev were obviously involved in money laundering and other illegal purposes via the UK legal system and the UK offices of HSBC. The Council asks to investigate possible acts of fraud by Mr. Govyadin and Mr. Samiyev.  This information was also sent to the US Internal Revenue Service for consideration and possible feedback due to its criminal background. There are indications that both are using the US monetary mechanisms for their illegal activities. Full copies of these letters can be read at the foot of this article, whilst numerous legal papers are in EU Reporter's possession.

The story of Sergey Govyadin has much in common with other infamous "new riches" from Eastern Europe who have a profound criminal portfolio.

Sergey Govyadin

Sergey Govyadin

Visibly a prosperous real estate businessman and developer, Sergey Govyadin is alleged in Russian media as being involved in many criminal cases related to fraud and other criminal incidents on selling elite property and apartments in luxurious districts in Moscow. Newspapers in Russia call Mr. Govyadin a "shadow influencer" alleging corrupt connections with a number of police authorities.

Togather with Ildar Samiyev, Mr. Govyadin has long been featured in the Russian criminal chronicle as a scandalous person, primarily found in fraudulent deals with private property and luxe apartments in fabulous districts in Moscow and in its suburbs. Back in 2015, Govyadin was “crowned” as a “successful millionaire” by tabloid press. By that time he was married to the beauty pageant - Miss Russia.  However, his name remains on the lists of fraudsters and corrupt officials published from time to time by the media.

According to them, Govyadin and Samiev denigrate other people who are their partners, in order to justify their allegedly illegal transactions. In Moscow, a high-profile trial has long been underway in the case of developer Albert Khudoyan, whom Govyadin and Samiev accused of fraud and deception. As a result, the businessman was arrested. His case became additionally known due to violations on the part of the investigation. Some corrupt law enforcement officials tried to profit from his arrest according to the media.

Russian business ombudsman Boris Titov has already defended Khudoyan. However, the process against him continues. Khudoyan suffers from heart disease.

The alleged illegal activities of Govyadin and Samiyev have a long history.

Ildar Samiyev

Ildar Samiyev

For example, together with Ildar Samiev, Govyadin is alleged to have taken part in the withdrawal of funds from Russian Svyaz Bank. He is alleged to have been involved in fraud with apartments in the elite Knightsbridge residential complex in Khamovniki district of Moscow, as well as a number of other stories.

For example, back in 2014, Optima property management LLC, owned by Govyadin, took $ 95 million loan from the state-owned Svyaz Bank and used the funds to purchase 22 apartments in the elite Knightsbridge residential complex under construction in Khamovniki. This company was controlled by Sergey Govyadin and Ildar Samiev through a chain of companies, namely the Russian LLC "Eurofinance" and the English company Mansfiled Executive Limited (from 25 to 50 percent of Mansfiled Executive Limited belongs to Govyadin, according to the Endole database). At the same time, the price of apartments under the deal was inflated, which allowed to actually withdraw more than a billion rubles from the state Bank.

The residential complex was constructed in 2016. Probably, because of the extremely high price, the purchased apartments remain on the balance sheet of Optima property management, since it is impossible to sell them at such a high price. Optima properties has not yet returned the debt to the Bank, and in 2018 Svyaz Bank filed a lawsuit to recover $ 95 million from Optima property management, but failed. As a result, the state, which is the owner of Svyaz Bank, suffered, having completed its rehabilitation in 2011. The debtor has apartments on the balance sheet that are unlikely to cost more than 50 percent of the debt amount, and more than 1 billion rubles settled on the accounts of the developer Knightsbridge, controlled by Govyadin.

It is obvious that the request of the Russian Irish Business Clouncilwill be an occasion for more close and detailed attention to the illegal activities of Govyadin & Co. British and American financial institutions will hopefully be held accountable of those international speculators.

Source information

HSBC letter

 

 

USA tax letter

 

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