Corruption, money laundering and financing terrorism

 
A. Corruption

The fight against corruption is a priority for the Belgian Government and is included in the National Security Plan. Widespread corruption is a plague that acts as a major obstacle to a country's sustainable economic development and heightens economic and social inequalities. Corruption is also an important source of resources for organised crime and the financing of terrorism.

The fight against corruption is one of the Sustainable Development Goals of the 2030 Agenda (SDG 16: Peace, justice and inclusive institutions; SDG 16.5 "Substantially reduce corruption and bribery in all their forms").

In Belgium, corruption is governed by the Penal Code, modified by the Law of 10 February 1999 (itself adapted by the Law of 11 May 2007). Articles 246 and subsequent of the Penal Code concern public corruption and Articles 504bis and subsequent of the same Code concern private corruption.

At international level, Belgium is a signatory of the following Conventions:

  • The United Nations Convention against Corruption (United Nations, 31 October 2003), which is the only universal convention fighting corruption.
  • The Convention on Combating Bribery of Foreign Public Officials in International Business Transactions (OECD, 17 December 1997).
  • The Criminal Law Convention on Corruption (Council of Europe, 27 January 1999).
  • The Civil Law Convention on Corruption (Council of Europe, 4 November 1999).
  • The Convention on the fight against corruption involving officials of the European Communities or officials of Member States of the European Union (Council of the European Union, 26 May 1997).

As a signatory State, our country is evaluated for its effective application of the provisions of these conventions through a Peer Review evaluation mechanism.

Foreign Affairs (Service M4, International Governance) coordinates and facilitates the inter-institutional coordination of the international review and monitoring mechanisms with which Belgium must comply. Belgium has recommended a good governance methodology as part of this international monitoring process. This tool invites international organisations to strengthen their synergies and coordination in order to avoid the duplication of these evaluations.

 
Information on the United Nations Convention against Corruption:

For the text of the Convention:
https://www.unodc.org/documents/brussels/UN_Convention_Against_Corruption.pdf 
 Information sheet on the UNODC (PDF, 1006.52 KB) (in Dutch)

The Conference of States Parties introduced a mechanism for reviewing the implementation of the Convention, to help States to implement the Convention effectively. This is a peer review mechanism, which means that the State being reviewed is evaluated by two States Parties, selected on the basis of a draw. Each review cycle, during which all the States Parties must be reviewed, lasts five years. An analytical summary is published on the UNODC website at the end of a country's review.

In 2016, Belgium completed its first review cycle, which covered chapters III – Incrimination, and IV – International cooperation. The analytical summary is published on the UNODC website.

The second review cycle covered chapters II – Prevention, and V – Asset Recovery. It was launched in July 2016. For the checklist for the second cycle: https://www.unodc.org/documents/treaties/UNCAC/WorkingGroups/ImplementationReviewGroup/20-24June2016/V1601515e.pdf.

The site visit by experts from the assessing countries took place in May 2018. The executive summary is yet to be published.

The technical focal points responsible for this second cycle are the FPS Policy and Support and the OCSC (Central Body for Seizure and Confiscation)

In October 2016, Belgium also ratified the six principles that guarantee the transparency of the Convention review process, in order to promote the involvement of civil society (Transparency Pledge UNCAC Coalition).

 
Information on the Convention on Combating Bribery of Foreign Public Officials in International Business Transactions

For the text of the Convention:
http://www.oecd.org/corruption/oecdantibriberyconvention.htm

 
Anticorruption guide for Belgian businesses abroad:

To make businesses working in international markets aware of the risks posed by corruption, the national contact point for the OECD Guidelines within the Federal Public Service Economy and the FPS Justice have put together a Guide to improve compliance with the rules for combating the corruption of foreign public officials in international business transactions:  Anticorruption guide for Belgian businesses abroad (PDF, 2.18 MB)

 
2017 OECD due diligence guide for businesses: https://www.oecd.org/corporate/RBC-for-Institutional-Investors.pdf

By way of guidelines, the FPS Foreign Affairs has sent the Anticorruption Guide to all diplomatic posts in order to provide Belgian businesses abroad with practical tools for dealing with corruption.

A memorandum of understanding was signed in October 2015 by FPS Foreign Affairs and FPS Justice. It states that if Belgian diplomatic posts abroad have information regarding corruption that may involve Belgian businesses abroad, they must immediately inform the Directorate General of Multilateral and Global Affairs of the Federal Public Service Foreign Affairs, which will send the accusation to the relevant authority.

 
Information on the Council of Europe Criminal Law Convention on Corruption:

For the text of the Convention:
https://rm.coe.int/168007f3f5

This Convention targets active and passive corruption in the public and private sectors. Belgium is also part of GRECO (Group of States against Corruption), which monitors the application of the Convention in the Member States (http://www.coe.int/en/web/greco/home).

 
Information on the Council of Europe Civil Law Convention on Corruption:

For the text of the Convention:
https://rm.coe.int/168007f3f6

 
Information on the Convention on the fight against corruption involving officials of the European Communities or officials of Member States of the European Union.

For the text of the Convention:
https://eur-lex.europa.eu/legal-content/EN/TXT/?uri=LEGISSUM%3Al33027

 

 
B. Money laundering

Money laundering is the hiding of capital or funds whose origins are known to be illegal (drugs, extortion, scams, arms sales, fraud, etc.).

In Belgium, the CTIF (Cellule de Traitement des Informations Financières - Financial Intelligence Processing Unit) is at the heart of the Belgian preventive mechanism combating the laundering of money of criminal origin, the financing of terrorism and proliferation.

The CTIF also chairs the Assembly of partners, which is part of the Coordination College for the fight against the laundering of money of illicit origin.

This Assembly works in the area of money laundering risks and preventive policy. Together with the other partners, it is responsible for drawing up a risk analysis for money laundering.

The Law of 18 September 2017 transposes Directive (EU) 2015/849 of 20 May 2015 on the prevention of the use of the financial system for the purposes of money laundering or terrorist financing, amending Regulation (EU) No 648/2012 of the European Parliament and of the Council, and repealing Directive 2005/60/EC of the European Parliament and of the Council and Commission Directive 2006/70/EC.

There are two components to the fight against money laundering:

  • Preventive aspect: the system created a duty of collaboration and transmission of information on the part of the bodies and persons targeted by this law, with the purposes of detecting suspicious financial operations and informing the CTIF to this effect (duty to report).
  • Enforcement component: Article 505 of the Penal Code. This article covers three types of behaviour that are likely to constitute the crime of laundering:
    • dealing in stolen goods: having bought, received in exchange or free of charge, possessed, kept or managed material benefits that are the result of an offence
    • the conversion or transfer of these material benefits with the aim of hiding or disguising their illegal origin
    • the hiding or disguising of the nature, origin, location, positioning, movement or ownership of the material benefits. This is aimed primarily at the use of front-men, figureheads or shell companies and recourse to companies or financial institutions located in offshore territories or tax havens.

The Law of 5 May 2019 containing various provisions amends the Code of Criminal Procedure.

This law allows for a better exchange and circulation of information between the various authorities responsible for combating money laundering.

It now authorises the public prosecutor to request the necessary information on the products, services and transactions of a financial nature, and the virtual assets concerning the suspect, from:

  • The institutions referred to in Article 5, § 1, 3° to 22° of the law of 18 September 2017 on the prevention of money laundering and terrorist financing, and limiting the use of cash;
  • The Central contact point of the National Bank of Belgium, in accordance with the law of 8 July 2018 on the organisation of a central contact point for financial accounts and contracts and on extending access to the central file of notices of seizure, delegation, transfer, collective settlement of debts and recourse.

In addition, where the CTIF has transmitted information to the common databases in accordance with Article 44/11/3ter, § 4 of the Law of 5 August 1992 on the police function, all relevant information may be communicated to all services which, pursuant to that Law, or its implementing decrees, have direct access to all or part of the personal data and information contained in those common databases. This information may only be used by these services for the purposes for which they have access to the common databases.

 
C. The financing and of terrorism and proliferation

The fight against terrorism and its financing is part of the national security plan. To assist it in its mandate, Belgium can count on the 40 recommendations of the FATF (Financial Action Task Force) against money laundering, terrorist financing and proliferation.

These recommendations are divided into 4 groups:

  • Legal systems (Recommendations 1, 2, 3)
  • Measures to be taken by Financial Institutions and Non-Financial Businesses and Professions to prevent Money Laundering and Terrorist Financing (Recommendations 4 to 25)
  • Institutional and other measures necessary in systems for combating Money Laundering and Terrorist Financing (Recommendations 26 to 34)
  • International cooperation (Recommendations 35 to 40)

The FATF has 38 members and two regional organisations (the European Union and the Gulf Cooperation Council). It was set up in 1989 by the G7 and operates on the basis of peer evaluation (one member state evaluates another member state).

Belgium was evaluated at the Group's plenary meeting in February 2015. This evaluation, known as Phase IV, covered technical compliance (to what extent the Member State's legislation complies with the standards of the Group) and effectiveness (to what extent these recommendations are effective)

Belgium must respond to the Group's remarks by 2020 in order to be considered fully compliant with the 40 recommendations.