Anti-corruption rules

Deadline looms for government ethics code update

Former finance minister Pierre Gramegna (DP) has not yet revealed his post-politics plans, but won’t be able to use insider information for two years under the current ethics code Library photo: SG9LU

Former finance minister Pierre Gramegna (DP) has not yet revealed his post-politics plans, but won’t be able to use insider information for two years under the current ethics code Library photo: SG9LU

As former finance minister Pierre Gramegna plans his future career, the Luxembourg government has yet to fully comply with recommendations by an anti-corruption watchdog to ensure former officials don’t use insider knowledge to their advantage.

Gramegna (DP) during an interview with RTL over the weekend had said he has a lot of experience to help the country and its financial centre but that he has no concrete plans yet what he will do after stepping down from government.

Under a current ethics code, there is no official cooling off period. However, for two years, former members of government cannot use insider information they gained during their time in office to advise their new employer and clients or to gain advantage for their own business venture.

An ethics council, charged with ensuring adherence to the code, in 2020 had warned that this rule is nearly impossible to enforce, recommending that former ministers be banned from taking up a position in the private sector linked to their government portfolios for two years.

This came after former economy minister Etienne Schneider (LSAP) was nominated to join the board of ArcelorMittal just four months after leaving office on top of appointments to Russian oligarch Vladimir Yevtushenkov’s holding company Sistema and founding his own consulting business BetaAquarii.

March 2022 deadline

The Group of States against Corruption (Greco), an anti-corruption watchdog within the Council of Europe, already in 2018 had criticised Luxembourg’s lax rules, issuing a set of recommendations. The government in response set up a working group, submitting reform proposals to Greco for feedback before adopting them.

“Greco has looked at these proposals and submitted a review of these to the government to continue working on the implementation of the recommendations,” a spokesperson for prime minister Xavier Bettel (DP) said by email. “The government now has until March 2022 for this.”

For example, the government suggested that the ethics council must be notified of any new private sector activity by a former minister for two years and can submit recommendations on how to avoid conflicts of interest.

But Greco would like the ethics council to get more powers. “The ethics committee should be able to recommend, in the most obvious cases of conflict of interest, that the former senior official not be allowed to engage in the intended activity,” the group said in a review of the proposals.

It also urged the government to make public all opinions issued by the ethics council. Currently, opinions must only made public if the committee reports an ethics code violation. This lack of public oversight leaves too much room for the government to decide whether an opinion should be published or what it does with the council’s advice.

The Greco report from November 2020 was followed up by a European Commission rule of law review, which also highlighted shortcomings in Luxembourg’s rules for former ministers and civil servants. “Room for improvement remains as regards the regulation of conflicts of interest and revolving doors,” it said in July last year.