After fifteen years of NGO struggle, France is preparing to adopt a mechanism to return assets to the population that were confiscated in cases that foreign leaders have referred to as “unlawful gains”.
Once the measure is voted on on Tuesday in the House and on July 21 in the Senate, a broad project is opened for its implementation in the countries concerned, via development projects.
What is “unfair gain”?
“Illicit goods” refers to assets and public goods that have been embezzled by foreign leaders or their close relationships for personal purposes: luxury real estate, cars, watches, bank accounts…
France has always been seen as a privileged destination for these legacies. In 2008, Sherpa and the NGO Transparency International filed a complaint against leaders from Gabon, Congo-Brazzaville and Equatorial Guinea, paving the way for investigations.
The most advanced measure concerns Teodorin Obiang, the son of the president of Equatorial Guinea, who was sentenced on appeal on February 10, 2020 to three years in prison suspended and €30 million in fines and confiscation. A ruling from the Court of Cassation is expected on July 28.
What is the French mechanism?
Since 2003, the UN Merida Convention (Mexico), signed by many countries, has established the principle of returning the fruits of corruption to the looted countries. But refund mechanisms are still rare: they are especially present in the US, UK and especially since the 2015 law in Switzerland, where it is considered the most successful system.
France, in turn, is preparing to adopt a mechanism, through a bill dedicated to solidarity development, to be finally adopted on July 21.
It provides for “the recovery, as soon as possible from the residents of the foreign state in question”, and “the income from property confiscated from persons who have been conclusively convicted of money laundering, concealment…”
How is it implemented?
In practice, a specific budget line item, supplemented by the resale of goods, is foreseen in the French budget under the responsibility of the Ministry of Foreign Affairs. “Cooperation and development actions” should be funded “on a case-by-case basis” in the countries concerned, in the areas of health, education, gender equality, etc.
The first concrete case should be that of Equatorial Guinea. With the uncertainty about whether the credits can be shown this fall in the 2022 budget or only in the 2023 budget, it is time to resell the confiscated goods, estimated at 150 million euros by NGOs.
“It will not count as ODA, because it is money that is not ours. The usual budget mechanisms will not apply: there will be no reserve rate” (margin held by the state), and “There will be an automatic transfer of credits from one year to the next if they are not used.”, confirms a diplomatic source.
Why is it difficult?
Reparations must combine respect for the “sovereignty” of the countries concerned and the involvement of civil society to prevent funds from returning to corrupt circles.
A delicate mission in Equatorial Guinea, led by Teodoro Obiang Nguema for nearly forty-two years. “There is hardly any independent civil society, almost all of our partners there are exiles, and it can be complicated.”, notes Sarah Brembieoff of the NGO Transparency, who applauds the future mechanism but remains “vigilant.”
According to AFP information, contacts have already been made between France and the authorities of Equatorial Guinea to explain the compensation philosophy.
Some parliamentarians regret that the mechanism remains under the supervision of the Ministry of Foreign Affairs. The response should not be mixed with other diplomatic matters. Emily Carrillo, a former LREM MP, warns.
Finally, to recover other “illegal” assets, it “You’ll have to get to know them first.”Lawyer Nicola Bonucci, a former expert at the Organization for Economic Co-operation and Development, insists. “This will only make sense if France adopts a proactive policy.” Detecting illicit financial flows.
As such, the “trust in justice” bill currently under consideration and limiting it to three years of preliminary investigations worries NGOs, while financial inquiries are often very complex.