Republic of Srpska is Trying to Legalize the Conflict of Interests With a New Law

Banja Luka, May 26, 2023 – The authorities of the Republic of Srpska are trying to completely legalize this phenomenon with new amendments to the Law on Prevention of Conflict of Interest and enable public officials to be at the head of associations financed from the budget. Transparency International in Bosnia and Herzegovina sent comments on the draft amendments to this law established by the Ministry of Administration and Local Self-Government of the Republic of Srpska, where only one article is changed, which allows elected officials, holders of executive functions and advisors to perform additional functions in associations financed with public money if they do not receive compensation for it.

What is completely absurd is that changes to this law, the improvement of which the European Union has been seeking for years, were expressly referred to the procedure when the former president of the High Judicial and Prosecutorial Council and advisor to the President of the Republic of Srpska, Milan Tegeltija, found himself in a conflict of interest. This law currently prohibits public officials and their advisers from being the head of any association financed from the budget with more than BAM 100,000.

As Tegeltija was recently appointed as the head of the Football Club “Borac” Banjaluka, which, according to official information provided to TI BIH, received 2 million BAM from the Government of the Republic of Srpska this year alone, it is clear that he is in a conflict of interest, which is why TI BIH sent reports against him and five other leaders of football clubs in BiH to the authorities.

While making excuses to the media, Tegeltija reduced the appearance of a conflict of interest when financing the association to receiving a salary, stating that he does not receive compensation for working in the club, and therefore there are no “two conflicting interests”. Immediately after presenting this interpretation, the Ministry initiated a procedure to amend this law, in which only one article is changed and officials who do not receive compensation for their work in the association are exempted from the ban.

Such a provision, apart from not being harmonized with the laws on conflict of interest at any level in BiH, is also contrary to other provisions of this law which define that the private interest of an official includes any advantage for him or her or the organizations with which he or she had or has business, political and other connections. The goal of this law is to prevent officials from distributing money from the budget to their own associations and private companies, so the appearance of a conflict of interest cannot be reduced to receiving a salary.

TI BIH has been warning for a long time that it is unacceptable for the same people to be in the government distributing public funds and at the head of the association deciding on the ways to spend public money, and it should be remembered that the public has been listening for years about scandals surrounding the misuse of public funds for these purposes. It should also be noted that the public has no insight into how sports clubs and other associations spend the money they receive from the budget and that funds are distributed without a public call, established procedures and measurable criteria.

These changes open up space for additional abuse, and it must be said that the Republic of Srpska has the worst law in this segment because the prohibitions do not apply to double functions in numerous associations that receive less than BAM 100,000 per year, while, for example, in Brčko District, the prohibitions apply to all associations that receive over BAM 10,000.

This is why such changes are contrary to EU requirements set through 14 priorities, where all levels of government are asked to harmonize and improve laws on conflict of interest, and this is not the first time we have attempts to adopt solutions that are worse than the existing ones. TI BIH therefore calls on the authorities in Republic of Srpska to abandon the adoption of this law and finally introduce a law harmonized with international standards into the procedure.

Press rls_26.05.23_