Preliminary Bill for a Comprehensive Amendment of the Argentine Ethics Law

On February 14, 2018, the Argentine Anti-Corruption Office revealed the first draft of the preliminary bill to reform the Law on Ethics in the Exercise of Public Office (the “Draft Bill” and “Law 25,188”, respectively) through the following website: https://consultapublica.argentina.gob.ar/leyeticapublica.

I) Public Consultation

The Draft Bill was made public within the framework of an open participation process carried out through public consultation, which allows any person to comment on the provisions of the Draft Bill promoting debate on its text. This debate seeks to achieve a consensual text, guaranteeing the effective implementation of the regulation as well as promoting trust in public institutions. With the intent of structuring the debate, the Draft Bill’s text is split into six thematic axes, each with its own debate dates:

1. general provisions, principles and ethical responsibilities: February 14 - 16
2. regime of sworn statements regarding assets and interests: February 19 - 23
3. regime of conflict of interests: February 26 - March 2
4. regime of gifts to public officials: March 5 - 7
5. institutional design for the application of the law: March 7 - 13
6. official publicity and complementary provisions: March 14 - 16

II) Regulated matters

(i) Scope of application

The Draft Bill will be applicable to all persons performing public functions (in the Executive, Legislative and Judicial Branches and in the Public Ministry), at any of its levels and hierarchies, regardless of whether they were appointed through popular election, direct appointment, public competition or by other means.

(ii) Nepotism

Continuing the direction set out in Decree 93/2018, which prohibits the appointment of persons related to upper level officials of the National Public Sector, the Draft Bill adds a chapter directed at combatting nepotism. This chapter provides a series of prohibitions for the appointment of positions without a public background competitive process within the National Public Administration, Legislative Power, and Executive Power, stating that all appointments and promotions carried out in violation of its provisions “will be null and void, notwithstanding other sanctions which might be applicable to the responsible officials”.

(iii) Conflict of interest

The Draft Bill also regulates conflicts of interest. The Draft Bill includes a definition of the concept, providing that there is a conflict of interest when “a public interest which corresponds to the exercise of an office coexists with a private interest, whether it be of economic in nature or not”, and clarifying that it exists as “an objective situation, configured independently of the official’s intent to achieve a benefit”.

In turn, possible conflicts of interest are classified as: (a) current, if the coexistence of interests is the consequence of carrying out private activities while exercising public office or the ownership of certain financial interests –such as providing services for someone who carries out activities over which the officer has jurisdiction–, (b) potential, when the coexistence of interests appears in a circumstantial way, caused by personal interests of the public officer, which may eventually overlap with their powers –such as intervening in matters related to persons for which the officer had provided services– and (c) apparent, when there is no conflict of interest within the terms of the Draft Bill, but there remains a general perception that the impartiality of the officer’s decisions might be affected.

(iv) Meetings of regulatory bodies

As an additional measure to ensure transparency, the Draft Bill provides that all meetings convened by the organs of public utilities’ regulatory bodies which have the minimum number of members needed to make decisions, must be open. Any public or private persons that wish to attend will be able to do so without the need to demonstrate any particular standing.

(v) Regime of gifts to public officials

The public officials’ gift regime is regulated following the general criteria of Decree 1179/2016, and clarifying that gifts addressed to spouses, partners or underage children of certain public officers will be considered as being addressed to the officers themselves, and are therefore subject to the provisions of the Draft Bill.

(vi) Enforcement Authorities

The Draft Bill states that the Executive, Legislative and Judicial Branches, as well as the Public Ministry will appoint or create an autarchic entity to exercise the functions of an enforcement authority. These agencies will have functional autonomy and will be under the leadership of one officer, who will occupy said position for a period of 5 years, and will be designated by the top authority of each jurisdiction through a public and open procedure, with the possibility of one re-election. The functions of the enforcement authorities include, among others, resolving the complaints for infractions to Law 25,188, as amended, guaranteeing the publicity of the Sworn Statements of Assets and Interests, and issuing explanatory regulations and interpretative opinions. The Draft Bill’s text also appoints the Anti-Corruption Office as the enforcement authority corresponding to the Executive Branch.

(vii) Health Insurance Companies and Unions

Lastly, the Draft Bill includes modifications to the laws of Health Insurance Companies (No. 23,660) and Unions (No. 23,551) to extend the obligation to present Sworn Statements of Assets and Interests to new agents. In this regard, the obligation will include persons who:

• hold a position in the collegiate bodies that run and manage health insurance companies;
• hold a position in the direction and management bodies of unions;

III) Final Comments

The Draft Bill provides detail and specificity to the current provisions of Law No. 25,188 and strives to establish a system which promotes citizen trust in public institutions, evidenced by the participation stage of public consultation to which it is subjected. It will be important to follow the evolution of the Draft Bill through both the consultation procedure and in Congress.