Netherlands - Corruption
The Netherlands for many years has been considered one of the least corrupt countries in the world. Organised crime in the Netherlands can be described as ‘transit’ in nature, involving illegal trade, trafficking and smuggling of goods and services, and taking advantage of country’s role as an important logistical hub. Low-level police corruption and information leakage related to drugs occasionally take place. Although national level politicians and the judiciary are considered not corrupt, at the local government and administrative level, white collar crime related corruption has been encountered (in particular related to construction industry). As some officials admitted, though, due to the perceptions of low corruption, often monitoring is not robust, and detection of corruption low.
Organised crime in the Netherlands can be best described as ‘transit crime’, consisting primarily of cross-border criminal activities: drug smuggling, human smuggling, human trafficking for sexual and labour exploitation, trafficking in arms, trafficking in stolen vehicles, money laundering, evading taxes, etc. Ethnicity is important factor in the composition of criminal groups in the Netherlands, though there are also ethnically ‘mixed’ networks. The large immigrant population in the Netherlands, originating from drug production regions such as Latin America (Cocaine), Turkey (heroin), Morocco (Cannabis), plays an important role in transnational drugs trafficking.
With regards to political parties, much of the corruption discussion in Netherlands has been focused on political party financing. This has led to the adoption of a law governing the funding of parties and ensuring some subsidies from the state. The law does not prohibit private funding, although all gifts of more than 5,000 EUR have to be made public.
The predominantly catholic province of Limburg in the south of the country is considered as more prone to corruption, which is explained by reference to ‘tightly-nit social networks, and reversed social capital” by some. In tight catholic communities the dense social network centred around religious identity facilitates corruption. Traditionally, local level corruption is connected to municipal real estate (e.g. land being sold at artificially low prices). Corruption is also used in municipal public contracts, where networks circumvent the standard rule of expertise, and rely on connections and local cliques to win the contract.
Anti-bribery legislation to implement the 1997 OECD Anti-Bribery Convention (ABC) became effective in 2001. The anti-bribery law reconciles the language of the ABC with the EU Fraud Directive and the Council of Europe Convention on Fraud. It makes corruption by Dutch businessmen in landing foreign contracts a penal offense, and bribes are no longer deductible for corporate tax purposes. At a national level, the Ministries of the Interior and Kingdom Relations as well as Security and Justice have taken steps to sharpen regulations to combat bribery in public procurement and in the issuance of permits and subsidies. Most companies have internal controls and/or codes of conduct that prohibit bribery. The Netherlands signed and ratified the UN Convention against Corruption and is party to the OECD Convention on Combating Bribery of Foreign Public Officials in International Business Transactions. NGO Transparency International ranked the Netherlands seventh on its 2011 Corruption Perception Index.
The laws provide criminal penalties for official corruption, and the government generally implemented the laws effectively. There were isolated reports of government corruption during 2011. The government pursued an active anticorruption policy coordinated by the Internal Affairs Ministry’s Bureau for Promotion of Integrity of the Public Sector. The National Criminal Investigation Service coordinated investigations under the supervision of the national prosecutor for corruption. There are no laws requiring financial disclosure; however, for most senior positions, every organization has its own regulations to avoid conflicts of interest.
The law provides for public access to government information, and authorities generally respected that right. When authorities denied information requests, they provided reasons based on the law. Those seeking information could appeal any refusal to the regular courts. Disputes occasionally arose in court over the scope of the government’s right to withhold information in the public interest.
Following public allegations of corruption in Curacao, a special Dutch investigator produced a report suggesting the possible involvement of several cabinet members in corrupt activities. The Curacao government refused to pursue a Dutch request for further investigation into these allegations and asserted that the Dutch investigator’s report included unfounded accusations and “useless information.” This response contributed to heightened concern among many citizens about the quality of governance. The kingdom’s government retains oversight over some areas, including aspects of the judiciary (such as the Supreme Court), and “kingdom matters,” including human rights, the rule of law, and good governance. However, the Dutch see intervention as a last resort, while the Curacao government suggested that the Dutch right to intervene should be drastically changed in ways that would both simplify and minimize outside oversight.
While the number of prosecutions in foreign bribery cases is on the rise worldwide, the Netherlands has been only “moderately” successful in bringing corporations and individuals to account according to a new report by the anti-corruption NGO Transparency International. Titled “Exporting Corruption?", the report released 06 September 2012 tracked the progress of the 39 countries signed up to the 1997 OECD Anti-Bribery Convention to fight global corruption.
While the US, Germany and even Italy are among the world’s most stringent enforcers in curbing the foreign bribes that often lead to better contracts or shortcuts around local regulations, the Netherlands is grouped with Argentina, Japan and France as needing to get tougher in the fight against corporate corruption. Of the nine foreign bribery cases in the Netherlands, says the report, there have been no sanctions handed down to any individuals or companies. Four investigations are still pending, including one reportedly involving illegal payments in Jamaica by Trafi gura Beheer BV, the world’s largest independent oil trader.
Dutch authorities also failed to respond on time to a 2008 Polish request to investigate electronics giant Philips, which led to the dismissal of Poland’s bribery case against the company. Transparency International is calling for increased sanctions, more cooperation between police and financial investigators and whistleblower protection in the Netherlands.
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