Fighting Corruption in on the Transnistrian Border: Lessons from Failed
Anti-Corruption Programmes and New Successful Programmes
Mariya Polner (EUBAM)
Preprint version of Review of Eastern and Central European Law 34(1).
In 2007, both Moldovan and Ukrainian authorities took firm steps to reduce corruption along the Transnistrian border. This paper – aimed mainly at anti-corruption practitioners and scholars in public administration – discusses the background and underlying principles guiding the anti-corruption work being adopted by both governments in order to facilitate discussion about optimal anti-corruption programme design. This paper presents a set of tools used during the planning phase of the anti-corruption programme -- outlining the methodology used to assess the extent of corruption on the Transnistrian border, the problems of legislative transplants, a “contract test” for defining corruption offenses, a method of risk analysis, and a model of optimal anti-corruption programme organizational design.
THIS PAPER IS A DRAFT AND DOES NOT REFLECT THE VIEWS OF THE PARTIES
MENTIONED IN THIS PAPER.
Fighting Corruption in on the Transnistrian Border: Lessons from Failed
Anti-Corruption Programmes and New Successful Programmes
services in both
article attempts to provide an academic background on practitioner work in
designing an anti-corruption programme at the Transnistrian border – allowing
the reader to “look under the hood” of an anti-corruption programme and see
some the academic considerations in anti-corruption programme design.
The first part of this article will provide an estimate of the scale of
corruption along the Transnistrian border – showing an economic methodology
used to estimate corruption in two particular services – border guard and
customs -- in
discusses the fight against corruption focusing on two specific government
services – the border guard service and customs service – in
The Transnistrian area is situated along a significant
proportion of the Moldovan-Ukrainian border. In 2006, more people and goods
The red area in Figure 5 represents
the area disputed between the Moldovan government and the authorities of the
Trannistria based in
Irregardless of Transnistria’s diplomatic position, the existence
of this semi-regulated territory wedged between
particularly the payment of bribes, occurs when a private individual interacts
with a government official. Such
interaction with government officials in the Transnistrian region primarly
occurs as border crossers interact with customs officers or border guards.
Customs services in
From the reports and survey information available, corruption affecting the particularly affecting the Ukrainian/Moldovan border is relatively modest by national standards (though excessive by European Union standards). While direct measurement of corruption is difficult, indirect measurements are often used to point out obvious problems with customs and border guard service delivery – as corruption is often either a symptom of poor service delivery, or concomitant with poor service delivery. Slow and unhelpful administration often results in corruption. As shown in Figure 5, roughly 30% of Moldovan respondents in a business survey reported by Carasciuc (2005) noted that they had to give a bribe every time they crossed the border (with roughly the same amount of respondents noting that they never need to pay bribes). In exchange for those payments, as shown in Figure 6, the majority of border crossers received faster processing times, and one-third received a “better” classification of goods. More worryingly, in 14% of the cases, business representatives faced coercion – having “no other choice” but to pay bribes.
Survey data covering trade-related corruption among Ukrainian business people are much more difficult to obtain. Figure 8 shows popular perceptions of corruption in a number of government services. As shown in the Figure, 64% of respondents think that corruption represents a “serious” problem (as stated in the survey) whereas almost 80% of respondents thought corruption in hospitals represented a serious problem.
has a negative impact on both public revenue and economic development.
According to the Carasciuc (2005) study, in
the level of corruption can be estimated from the level of trade between Moldova
and Ukraine as well as estimates from businesses about their “bribe tax” (or
the proportion of the value of their trade and/or sales) which is collected in
the form of bribes – 20% of firms estimate that 2% of the value of their trade
is subject to a “bribery tax.” Given
a base of $480 million in exports from
estimates, however, underestimate the extent of corruption along the
Ukrainian-Moldovan border, because they do not take into account unreported
activities (either persons crossing the border to the value of goods not
reported in the official statistics). In order to estimate corruption involving
these unreported activities, corruption “risk” needs to be calculated as the
probability of each unreported event occurring multiplied by the number of
times it occurs. Taking
Carasciuc’s (2005) estimates of the average bribe level for customs and border
guard officials, and other estimates related to the proportion of
under-valuation of goods at least $30
million in trade taxes is not collected by Ukrainian officials for goods
corruption is most likely tied to illegal activity.
Figure 10 provides a brief rough estimate of the scale of corruption tied to
black market activities related to the traffic in illegal narcotics, weapons,
and the humans. According to publicly available sources, the total estimated
amount of heroine flowing through Ukraine in destination to Western European
markets is 23.1 metric tonnes at a market price of $78 per gram results (with
roughly 1 million grams per ton) in a market value transited through Ukraine of
$1.8 billion. If the
bribery tax previously referred to covers illegal transit of narcotics, then
the value of these bribes equals $18
million. With regard to arms, estimated that, in the 1990s, roughly $5.3
billion in arms leaves the
Figure 10: Contraband and Estimated Corruption Value
See print (offline)
version for estimates
See print (offline) version for estimates
where cited. Estimated bribe revenue derives from World Bank estimates of the
“bribe tax” previously mentioned in the text. Data are unavailable for
The economic logic underpinning these specific
calculations is described in Figure 11. However, the economic impacts are much
larger in a number ways. First, the reader having taken a course in
international economics will immediately recognize that the bribe serves as a
trade tax – decreasing wages in
Figure 9: An Economic Calculation of Corruption along the Transniestran Border
Estimates involving the value of corruption in international trade are always difficult to obtain because parties to corruption have little incentive to disclose their activities to third parties. However, approximations can be made. For example, as previously noted, survey data (from World Bank (2003), can reasonably reliably estimate the value of traders’ goods paid in bribes. A “bribe tax” (denoted by b) may affect a value of normal consumer goods flowing across a border in any particular year (Xt). While the payment of bribes is an obvious economic harm to traders (though from an economist’s point of view, bribes often represent a simple redistribution of national income). Bribes are often paid, following economic incentives, to provide traders with an economic advantage – such as lower taxes which result from under-valuing or mis-categorising goods. If Xt represents the true value of goods and Xr represents the reported value of goods, then the State budget clearly loses the tax (t as expressed as a percentage) of the difference between the reported value and the true value.
However, the real harm to corruption at the border occurs for two reasons. First, the value of production may be affected as traders divert a fraction of their overall production into other activities (d) – as businessmen substitute out of activities where bribes are sought and into other economic activities. Offsetting this loss are the gains from faster trade and lower taxes which encourages producers to increase by a fraction their production (c). Second, corruption in legal goods (like potatoes) often encourages – or at least occurs in parallel with -- trade in illegal goods (like contraband). If q represents fraction of contraband goods which are traded in relation to normal consumer goods, then the total loss to budget (as these goods as are not taxes) is qXt.
Combing these terms results in an overall estimate for the loss due to corruption at:
Of course, this estimate does not incorporate the
social and other harms often referred to by academics and policymakers.
A large amount of donor assistance has been committed by foreign donors – particularly USAID and the OECD – aimed at improving the quality of anti-corruption legislation in both countries. Judging the quality of legislation is difficult – particularly in the area of anti-corruption where no set of practices has been shown definitely to be more effective than other practices. However, an obvious metric by which to assess the quality of legislation and/or implementing regulation must depend on its purely technical aspects. Following Michael (2004), one way of assessing the quality of anti-corruption legislation and regulations depends on its specificity and relevance. Specificity refers to the extent to which legislation refers to concrete practices instead of abstract principles and answers the 5 journalist questions (who is affected, what is involved, when are actions to be carried out, and how are these activities to be undertaken). Second, in both the practitioner and academic literature, a very wide array of factors have been linked to the level of corruption in an administration (from the motivation of staff to national culture). Yet, some factors relate more directly to fighting corruption – as opposed to other areas of activity such as civil service reform – and thus are classified by their relevance to the anti-corruption programme.
provides an assessment of the national anti-corruption action plans. As shown,
the quality of the actual legislation seeking to prevent corruption is
relatively immaterial because the plans aiming to implement the law are highly
non-specific and irrelevant. In the case of
Figure 11: Assessing the Quality of Anti-Corruption Action Plans
Source: author. (one is lowest score and five is highest). See Michael for a detailed
computation of these scores and a further discussion of the methodology.
An obvious – though wrong – implication of this discussion is that anti-corruption legislation and implementing regulations need to be strengthened. However, the adoption of anti-corruption conventions and work on national anti-corruption programmes do not correlate to more effective action against corruption. Stevens and Rousso (2003) – using econometric analysis – investigate whether the adoption of anti-corruption legislation affects the level of corruption in country (as proxied by individual’s perceptions of the level of corruption). They specifically define three variables aimed at measuring the legislative environment surrounding the fight against corruption. First, they measure the adoption of “omnibus” activities (the adoption of a national anti-corruption which involved NGOs and multiple branches of the executive), the development of a national anti-corruption action plan, and the creation of an anti-corruption agency. Second, they measure the ratification of legal frameworks, specifically a civil service law, a financial disclosure law for civil servants and/or politicians, a freedom of information law, a law on political party finance, and an anti money laundering law. Third, they measure membership to international conventions including the Stability Pact, the OECD Convention and the Council of Europe’s four conventions against corruption. Figure 12 shows some of the many variables in their analysis – pointing to the fact that legal adoption has a statistically significant correlation with reductions in perceived corruption—though the adoption of national action plans or work in international consultative committees does not.
Figure 12: Selected Regression Coefficients from Stevens and Rousso (2003)
See print version
See print version for coefficients
Such results are worrying because the adoption of
national anti-corruption laws, especially those which criminalize corruption
offenses as recommended by conventions promulgated by the OECD and the Council
of Europe are often used as a measure of the strength of anti-corruption
legislation. These conventions call for the establishment of criminal rather
than simply administrative or civil liability for corruption offenses by civil
servants. Ostensibly, the more severe criminal remedies -- proposed by model
laws such as the OECD Convention -- provide greater deterrence for engaging in
corruption. While implementation of the criminal responsibility foreseen in the
OECD Anti-Corruption Convention (and thus the acquis communautaire) is laudable, criminal responsibility for
corruption may reduce the incentive to investigate and prosecute cases of
the adoption of the OECD Anti-Bribery Convention by
response to fighting corruption in many countries has been to increase the
amount of anti-corruption regulations. These regulations increase the amount of
reporting which civil servants do – creating an “audit culture” which serves to
demonstrate probity instead of supply public goods and services.
Both Moldovan and Ukrainian border guard and customs services have adopted a
wide range of measures to fight corruption including the dissemination of rules
against taking bribes, psychometric testing of staff to test for psychological
pre-dispositions toward corruption, bans on pocket money and the use of a
personal mobile phone during working hours, and increased oversight of all
staff by newly formed departments for Internal Security. With anti-corruption
aid to both countries from the
Yet, the pursuit of “absolute integrity” in Ardy's words, may harm the public administrations of both countries more than it helps them. First, each regulation increasingly distorts the action of civil servants and creates incentives to contravene these regulations. Second, these regulations costs money to create and to enforce – resulting in an often repeated case where grants of equipment and regulations (“developed through consensus with key stakeholders in order to promote participation and build political will”) lie unused after the donor team returns to headquarters. Third, regulations of this kind of deincentivise staff – resulting in work effort losses which are greater than the harms from petty bribery. Simply put, an anti-corruption regulation should be put in place when:
Instead of seeking to establish rigid rules, a system of guiding principles (such as the “contract test” previously referred to) and a system of random audit should be conducted for four reasons. First, controlling all goods goes against the basic tenants of economics (particularly those involving the gains from trade) as well as the principles enshrined in the European treaties. Second, a properly designed random audit will detect the same proportion of offenses as 100% inspection. Third, random audit frees up resources to be used for investigation. Indeed, an inverse relationship normally exists between inspection breadth and quality – namely the higher the percent of people or goods inspected, the lower the quality of the inspection. Fourth, (as previously mentioned), regulations potentially result in the creation of rents – thus reductions in regulations often result in decreases in incentive to seek bribes.
stratified random sampling procedure divides people or goods into similar
groups representing similar risk levels -- for example all consignments from
In order to detect cases of corruption, service staff can also undergo stratified random sampling and audit. As shown in Figure 15, the border guard or customs service staff may randomly audit differing strata of border crossers. Similarly, the Internal Security department may randomly audit service staff – based on the expected probability that they might be involved in corruption offenses. Naturally, the risk of service staff being corrupt is tied in some way to the probability that the people they are controlling are involving in legal infractions. Thus, the two tiered system described in Figure 15 addressed both regulatory risk as well as corruption risk.
Such a risk management approach is increasingly common practice in the European Union. However, as government efficiency is higher in other countries, Ukraine and Moldovan Internal Security services need to play a developmental as well as supervisory function – by auditing for better performance as well as the possibility of corruption…as an Internal Security Department which seeks only to control corruption will have difficulties generating enough public value to continue. Such activities could include Ombundsman’s functions, the regular conduct of service delivery surveys and training.
Since the late 1990s, the international donors have
financed work on the establishment of anti-corruption co-ordinating councils or
agencies in a number of countries including
Yet, the large variation we observe around the world in centering anti-corruption activity suggests that the optimal organizational structure for fighting corruption remains an open question. Figure 17 shows the various possible organizational forms for fighting corruption – and stylized facts do not point to the efficiency of one form over another.
Figure 17: Various Anti-Corruption Organisational Arrangements
Work as Lead
Ministry of Interior
In many countries, investigators are responsible for ensuring successful prosecutions of corruption.
Strong competencies in enforcement, can ensure case management
Excessive law enforcement
Ministry of Justice
Inspired by Italian experience, the courts and judges as main bulwark against corruption
Can change laws and prosecute cases as own-competence.
Excessively legalistic perspective
Ministry of Economy/Development
Responsible for overall framework and incentives
Ensures root economic incentives for corruption removed
No competencies in investigation or prosecution
Office of Prez/VP
In corruption ridden administrations, president’s office takes AC as political promise and ensure clean government.
Ensures co-ordination and senior level political will
Work is politicized and changes with each administration
Army upholds the interests of the State even when Government weak
Strong power potentially independent of the government
History of human rights violations.
Each service responsible for self
Each service, often with Internal Security department, ensures own integrity.
Each service responsible for self
Knows own problems best and can tackle at lowest level
Significant duplication of resources and overlap
These bodies centralize work on AC and look only at public servants.
Ensures centralization of AC knowledge and competencies
Shifts responsibility to “someone else”
Consists of representatives of several agencies meeting together reguularly
Balances specialization with integration
Everyone (thus noone) responsible
Private company or NGO
Works as “island of integrity” completely outside of a corrupt government.
Can ensure integrity when whole public service corrupt
Authority delegated by government…no legitimacy
However, theory provides a guide for thinking about the optimal organization structure for anti-corruption work. Transaction cost economics argues that integration should occur between organizations – or organizational units – as the cost of writing, performing on and enforcing contracts between organizational units increases. Such an effect militates for organizational integration because marginal benefits increase (to a point) as the centralization of anti-corruption activity occurs – cases do not need to cross departments or ministries and information can be shared more easily. Such an effect is shown as an upward sloping line in Figure 18a and labeled as a transactions cost effect. On the other hand, several salient results from organizational theory point to the benefits from specialisaton of labour and tasks. Authors such as Kogut and Zander (1992) representing this tradition argue that integration serves only to combine competencies – and the development of these competencies in themselves should be left to specialized organizational units. In this view, as anti-corruption work becomes more integrated, the specific learning from each ministry decreases and the marginal benefits of such integration decrease as integration occurs. As shown in Figure 17a, such a capabilities effect is traced as a downward sloping line. The degree of integration of anti-corruption work should be at the point at which the marginal benefits from integration equal the marginal benefits from decentralization results in the optimal organizational structure for anti-corruption work.
Naturally the factors underlying these transaction cost and competencies effects may change over time – or vary from country to country. Looking at the resulting changes to the marginal benefits of integrating anti-corruption work as underlying factors change results in changes to the optimal degree of centralization of anti-corruption activity. Figure 17b shows the results when underlying conditions change/differ. For example, if transactions costs change (political factionalism increases or a data protection act is passed which hinders the sharing of data across departments), then anti-corruption work should become more centralized. If competencies effects change – such that each department becomes better at developing and using anti-corruption knowledge), then the optimal amount of anti-corruption activity integration decreases.
While Figures 17 and 17b are purely illustrative, they
provide intuitions needed to solve the problem of organisatonal structure in
In some ways the experience over the last 20 years in
Central and Eastern Europe provided useful cases of what not to do in
Yet, the Transnistrian situation poses a particularly new
situation for anti-corruption programme design for two reasons. First, the
literature lacks models of public administrations in which one or two services
can achieve dramatic decreases in corruption when the entire public sector
management environment is corruption-ridden. Thus, work on the Transnistiran
border will provide a useful case study for further work looking at
department-specific dynamics of corruption. Second, the literature lacks
convincing models of corruption which spills over from foreign territories – as
corruption appears to do from the Transnistrian region into both
Black, D. and R. Blue. (2005).
Concept Paper: Rule of Law Strengthening and Anti-Corruption in
Carasciuc, L. (2005).
Analytical report: Exploring the perceptions and experiences with the customs
control, services, and border officers in 2002-2005. Chisinau: Transparency
Centre for Investigations and Strategic Reforms -- CISR. (2003). Research Paper on Transnistria", Chisinau. Available at: http://www.peacebuilding.md/faq.htm?lang=en&idc=7&idfs=402b2de38b6ba
Democracy International, IFES
and DPK Consulting. (2006).
Drew, K. (2003). Whistle
Blowing and Corruption: An Initial and Comparative Review.
European Commission. (2006). STANDARDISED FRAMEWORK FOR RISK MANAGEMENT IN THE CUSTOMS ADMINISTRATIONS OF THE EU. Available at: http://ec.europa.eu/taxation_customs/resources/documents/framework_doc.pdf
Galtung, F. and C.
Gorodnichenko, Y. and K. Peter. (2006). Public Sector Pay and Corruption: Measuring Bribery from Micro Data. IZA Discussion Paper No. 1987 Available at: http://ssrn.com/abstract=884322
Hellman, J., G. Jones, D. Kaufmann and M. Schankerman. (2000). Measuring Governance, Corruption, and State Capture: How Firms and Bureaucrats Shape the Business Environment in Transition Economies. World Bank Working Paper 2313. Available at: http://siteresources.worldbank.org/INTWBIGOVANTCOR/Resources/measure.pdf
IFES. (2005). Survey: Public
International Crisis Group
Kaufmann, D., A. Kraay, and M. Mastruzzi. (2006). Governance Matters V: Governance Indicators for 1996–2005. Available at: http://web.worldbank.org/WBSITE/EXTERNAL/WBI/EXTWBIGOVANTCOR/0,,contentMDK:21045419~menuPK:1976990~pagePK:64168445~piPK:64168309~theSitePK:1740530,00.html
Kiev International Institute of Sociology. (1998). Questions on National Integrity.
Kouzmina, L. (2006). Russian
Customs Reform Follow-up survey, 2006.
Kogut, B. and U. Zander. (1992). Knowledge of the firm, combinative capabilities, and the replication of technology. Organization Science 3: 383-397.
Layne, M. (2001). Estimating
the Flow of Illegal Drugs Through
Movchan, V. (2004). Influence
of Tariffs and Non-Tariff Barriers on
Rudzitis, N. (2002). CORRUPTION
AND CUSTOMS SYSTEM IN THE
SPAI. (2002). General
Assessment Report for
Spector, B., S. Winbourne, J. O’Brien
and E. Rudenshiold. (2005). Corruption Assessment
Trade and Transport
UN (2004). United Nations Handbook on Practical Anti-Corruption Measures for Prosecutors and Investigators. Vienna: UN. Available at: http://km.undp.sk/uploads/public/File/AC_Practitioners_Network/Handbook_for_prosecutors.pdf
UNODC. (2005). Annual prevalence of drug abuse. Available at: http://www.unodc.org/pdf/WDR_2004/Chap6_drug_abuse.pdf
World Bank. (2005a). Guidelines For Risk Management in Customs. Available at: http://siteresources.worldbank.org/INTCUSTOMPOLICYANDADMIN/Resources/Risk_Management_Public_Letter.pdf
World Bank. (2005b).
following article draws upon the author’s experiences while working for the
European Union Border Assistance Mission (EUBAM) in
data, like other data such as Transparency International’s cross-country index
of corruption perceptions represent a computed summary measure from several
perceptions surveys. While the World Bank estimates use more complicated
statistical procedures, these numbers still only represent levels of corruption
as perceived by survey respondents. See
Kaufmann et al. (2006) for more on
the methodology. See Galtung and
 As a contribution to the anti-corruption literature, the material in this paper naturally does not represent all or the considerations of the Transnistrian programme or suggest that the advisors slavishly followed theory in designing the programme.
 Due to the difficulty in estimating the volume or value of this trade, such traffic is not considered in this paper.
 The CISR (2003) estimates that, given the economic sanctions being imposed on Transnistria, up to 50% of officially reported GDP is involved in the black market. In 2005, according to the same source, GDP in the region was $500 million.
 These schemes are both variegated and often complex. One example of such a scheme is the illegal transport of goods to duty-free zones in Moldova were these products are labeled as duty-free production and then re-exported to their original country of origin (often Ukraine)! The EUBAM website (www.eubam.org) provides this and other information.
 For an unbiased and highly readable analysis of Transniestrian situation (and the possible responses by the EU and the EUBAM, see International Crisis Group (2006).
 The canonical definition of corruption involves the “use of public power by a government official for a private gain” A defense of this definition is presented later in this paper.
 In practice, several other government departments may be present at the border, including health and safety inspections and veterinary services.
USAID financed reports attempt to assess the level of corruption in
to a survey taken in 2003 under the Partnership for a Transparent Society
Program, 75% of respondents believed corruption to be very widespread in the Ukrainian
central government, while 62% indicated they had actual personal encounters
with corrupt officials over the previous five years. This corresponds roughly
with perceptions surveys from other EU countries. For example, Rudzitis (2002)
cites survey evidence showing that 73% of survey respondents thought the
Lithuanian customs service was dishonest but only 5% having actually paid a
bribe to the survice. Kouzmina (2006) provides data from the
data contrast resoundingly with data from most Central and Eastern European
countries. For example, in recent data looking at corruption perceptions in
World Bank (2005b) for estimates for the bribe tax in
higher level of bribes for
 The calculation involves the most basic math. A probability (p) of an event, such as someone paying a border guard to allow an illegal crossing across a green border can be estimated, however rudely. The estimated amount of involved denoted as X, multiplied by the probability of the occurrence p results in a risk of a single unreported event as pX. For the reader with a background in mathematics, the computation of the total yearly risk is equal to the probability of an occurrence of corruption at any particular site is ΣjΣi(piXi)where i=number of sites and j=the number of time periods or trails.
 For a similarly minded (though more technically complicated) calculation of the size of bribery in Ukraine, see Gorodnichenko and Peter (2006) who estimate the total value of bribery in Ukraine at between 460 and 580 million USD.
 The relationship between corruption and contraband is complicated – with several officials noting that no direct evidence of corruption related to contraband can be found: http://www.rferl.org/featuresarticle/2005/10/05f3742a-1c2d-4e1a-a57f-0e9780549795.html
Market Value Figure: United Nations, 2005. World Drug Report.
about contraband in
 Rose-Ackermann represents a useful vade-mecum for the economic rationale behind corruption.
21 These normal consumer goods are contrasted with contraband goods. The previously given formula -- ΣjΣi(piXi) where i=number of sites and j=the number of time periods or trails – can be used as a micro-economic check on this, fundamentally macroeconomic estimate.
 The bribe tax, and the undervaluation estimate, assumes that the civil servant knows the true value of goods. Such an assumption is obvious because if the civil servant did not know the true value, he or she would accept the value claimed by the trader and no need for a bribe would arise.
 Indeed, the social harm is higher and can be calculated roughly as the value of earning lost for lives taken by guns and drug addiction.
 Indeed, the National Security and Defense Council of Ukraine has elaborated an Action Plan with monitoring mechanisms, actions to prevent corruption focused on the finance of political activity and the approximation of legislation to EU standards (which in this case revolves around compliance with the OECD and CoE conventions).
 For the reader unfamiliar with administrative procedure, national laws passed by the parliament – and in some countries by Presidential degree -- often give general instructions. Departments are subsequently responsible to devising internal regulations aimed at implementing these broad legislative projects.
other expert reports, this report will try to avoid to the extent possible a
discussion of regulations – preferring to focus on actual work practices for
two reasons. First, as noted by a recent OECD evaluation, “while
 A number of authors bemoan the lack of success in anti-corruption work. See Kaufmann (2006) for an empirical treatment of the anti-corruption industry’s progress.
 Michael and Bowser (2005) covers the problems with the OECD’s work in the area as part of its Anti-Corruption Network for Transition Economies. Most advisors in the region have indicated that the OECD’s working methods, in the cover of the Network, have resulted in expensive and ineffective assessment. The work of the Network will certainly either be devolved to SIGMA (also in the OECD), to the EU or discontinued.
 EU Member States in adopting the acquis communautaire, ratify legislation aimed at fighting corruption. However, the acquis only requires EU Member States to ratify the OECD Convention on Bribery of Foreign Officials in International Business Transactions and the Council of Europe Conventions (ETS 173 and ETS 174 which establish criminal and civil liability for corruption offenses).
the adoption of the criminal sanctions embodied in the OECD Convention may
negatively impact on
 The weaknesses in the judicial systems of both countries is covered in the literature previously cited.
 In most
EU countries, the accuser of a corruption offense has the burden of proof. In
 See Print source for citation
 See Michael (XXXX) for a further description of the audit culture and its impacts of public sector service delivery.
 For an easy to understand instruction sheet for implement a risk analysis approach in Customs, see World Bank. (2005).
 Current data, based on 100% inspection is probably unreliable due to poor inspection quality concomitant with large-scale checking.
 For more on this approach, see UN (2004).
 While not discussed in this article, the careful reader will immediate observe that a hazard function for corruption for each civil servant can be roughly estimated by the sum of the expected risks of legal infraction multiplied by the rent (or bXt as discussed previously).
 Because of the increasing adoption of New Public Management concepts in government, public audit is seen like private audit. In a private company, an audit department must frequently show that its activities result in a greater cost reduction or reduction in business risks than the audit ties up in staff and other costs. In the same way, an internal audit in a public sector organization should aim at creating more public value than it costs to conduct the audit.
 This section covers two very extensive literatures very quickly. The reader unfamiliar with these academic approaches should consult the relevant citations given in this paper for a further background.
 Transaction cost economics originally concerned itself with the question of why firms integrated instead of using arms-length contracts Williamson (1985). Later work – particularly Jenson and Meckling (1990) -- using a similar logic, sought to derive the optimal number of departments in an organisational unit.
 Print source for citation notes, political transactions costs often represent a determinant transaction cost – particularly within a public sector context. Such political transactions costs – or the costs of obtaining settlements over differing views of public sector activity – are usually large relative to the cost of ‘contracting’ across organizational boundaries in the public sector.
 As an
aside, this model explains other countries.
 See Print source for citation or an overview of the successes and failures of anti-corruption over the last 10 years.