Doc. 9774

16 April 2003

Financing of political parties

Recommendation 1516 (2001)

Reply from the Committee of Ministers

adopted at the 835th meeting of the Ministers’ Deputies (8 April 2003)

The Committee of Ministers welcomes the adoption by the Parliamentary Assembly of Recommendation 1516 (2001) on the financing of political parties. By insisting on the adoption of rules governing the financing of political parties and electoral campaigns and on formulating general principles at the European level, on which these rules could be based, the Assembly makes a valuable contribution to the defence of pluralist democracy and the transparency of the electoral process.

In order to respond to the concerns of the Parliamentary Assembly, the Committee of Ministers today adopted Recommendation Rec(2003)4 to member states on common rules against corruption in the funding of political parties and electoral campaigns, which takes account of many of the ideas and proposals put forward by the Assembly in its Recommendation 1516 (2001).

The Assembly is invited to take note of Recommendation Rec(2003)4 which is appended to this reply.

Appendix

Recommendation Rec(2003)4

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 8 April 2003

at the 835th 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 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, 10 and 11 October 1997;

Having regard to Resolution (97) 24 on the 20 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 Parliamentary Assembly,

In the light of the conclusions of the 3rd European Conference of specialised services in the fight against corruption on the subject «Trading in influence and illegal financing of political parties », Madrid, 28-30 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 Resolutions (98) 7 and (99) 5 respectively authorising and adopting the Enlarged Partial Agreement 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 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 in place 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.       SOURCES OF EXTERNAL 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:

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:

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 regulate donations from foreign donors.

II.       SOURCES OF FUNDING OF CANDIDATES FOR ELECTIONS AND REPRESENTATIVES ELECTED TO PUBLIC OFFICE

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 consider adopting measures to prevent excessive funding requirements 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.