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THE ROLE AND IMPORTANCE OF THE COMPLIANCE CONTROL SYSTEM IN
PREVENTING CORRUPTION RISKS IN THE STATE AND PRIVATE SECTOR.
Rustamova Shaxzoda Aliyevna
3rd year student of Faculty of Law, Samarkand State
University named after Sharof Rashidov
E-mail: shahzoda9007@gmail.com
Qurbonov Davlat Ravshanovich
Docent, Head of the Department of Special Legal Sciences, SamSU
E-mail: kurbanovdavlat73@gmail.com
Annotation:
This article provides a list of heads of State and Government involved in corruption.
In Uzbekistan, in accordance with the requirements of the law on corruption, a list of oversight
compliance is established; international standards and standards for the supervision of
compliance with corruption legislation; international standards for the supervision of compliance
with corruption legislation; international standards for the supervision of compliance with
corruption legislation; international standards for the supervision of compliance with corruption
legislation.
Keywords:
compliance control system, private sector, corruption risks,
The reforms being carried out in the fight against corruption in the public and private sectors are
not only aimed at improving national legislation based on foreign experience, but also at
implementing into national legislation certain international standards that have been used as an
effective system in this area.
One of them is the compliance control system, which is a set of effective and efficient tools that
have been widely used in this area.
The initial elements of the compliance control system are attributed to the establishment of the
Accident Prevention & Insurance Association in Germany in 1884.
However, most foreign literature, in particular, in the scientific book on the history of
compliance by American scientist Martin Kling, states that this system first emerged in 1906
with the establishment of the FDA (Food and Drug Administration), a federal service that
oversees the activities of companies producing food and pharmaceuticals in the United States,
and the need to establish companies and organizations whose activities are aimed at public safety.
The concepts of
“compliance”
or
“compliance control”
emerged in the Anglo-Saxon legal
system at the beginning of the last century and these concepts mean “organizing one’s activities
in accordance with specially established procedures and rules”. “Compliance” means consent,
conformity and acting in accordance with a rule or instruction.
Anti-corruption compliance control
is a preventive system that organizes the activities of state
bodies and business entities, banks in accordance with international standards, laws and other
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regulatory legal acts in the field of combating corruption, including timely identification and
prevention of corruption risks, conflicts of interest, reporting on violations of the law and
corruption-related offenses.
The purpose of introducing compliance control is to prevent corruption risks in the public and
private sectors and to systematically identify areas and areas where such risks exist, to monitor
factors that create conflicts of interest on a legal and financial basis, to create a comprehensive
mechanism for systematically protecting activities from various financial, economic sanctions
and other influences, and to maintain a positive image of the activity.
“Compliance officer”
is an employee of the compliance service responsible for compliance with
laws, regulatory documents, internal regulations, and is responsible for monitoring and
regulating the actions of employees in accordance with established rules.
This concept, which is of particular importance in the fight against corruption, was initially
established in paragraph 21 of the “State Program for Combating Corruption in 2019-2020”,
adopted on the basis of the Decree of the President of the Republic of Uzbekistan No. PF-5729
dated 27.05.2019 “On measures to further improve the anti-corruption system in the Republic of
Uzbekistan”, in order to strengthen anti-corruption measures in organizations with a state share
in the authorized capital, in paragraph 21, the task of introducing an anti-corruption compliance
control system and systematically monitoring its effectiveness was established. The compliance
control system was first reflected in this document under this name.
Based on the decree, starting from 2019, within the framework of the implementation of the
UNDP project “Fighting Corruption through Effective, Accountable and Transparent
Governance Institutions in Uzbekistan”, in cooperation with the responsible agencies, including
the Prosecutor General's Office, the Ministry of Justice and based on the specifics of their
activities, the task of introducing a compliance control system to identify and prevent corruption
risks as a pilot project in joint-stock companies and state organizations with a state share of
100% or more than 50% in the authorized capital, as well as large companies operating in
foreign markets or having foreign partners, was set.
International tender processes were held to implement the project in state organizations. The
process was attended by “White and Case” (USA), “KPMG” (Italy) and other international
auditing companies with extensive experience in this field. In cooperation with experts from
KPMG, which was declared the winner according to the tender results, work is underway to
introduce this system as a pilot project in the system of joint-stock companies "
Uzbekneftegaz
"
and "
Uzkimyosanoat
" and the Ministry of Justice of the Republic of Uzbekistan (including the
central office of the ministry, the Samarkand regional justice department, the Jomboy district
justice department, the central office of the State Services Agency, the Tashkent city department
of the agency, the Yunusabad district public services center, the central office of the Intellectual
Property Agency). Also, starting this year, these experiments are being carried out at the
initiative of the Prosecutor General's Office of the Republic of Uzbekistan with the support of the
UNDP, in the Ministry of Construction of the Republic of Uzbekistan, the Ministry of Higher
and Secondary Specialized Education, the Ministry of Health, as well as in state organizations
such as the Tashkent city administration, the Tashkent regional administration, the Mirzo
Ulugbek district and Buka district administrations.
The implementation of the compliance service in the above-mentioned companies and
organizations is carried out in 4 stages:
Stage 1: analysis of the current state of the anti-corruption compliance control service;
Stage 2: development or improvement of anti-corruption measures and control mechanisms;
Stage 3: implementation of the anti-corruption "compliance control" service;
Stage 4: work is being carried out in such processes as assessing the effectiveness of the
implemented anti-corruption "compliance control" procedures.
1
The "State Program for Combating Corruption in 2019-2020", adopted on the basis of the Decree of the President
of the Republic of Uzbekistan No. PF-5729 dated May 27, 2019 "On Measures to Further Improve the Anti-
Corruption System in the Republic of Uzbekistan"
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The UN Convention against Corruption, such as Article 12 “
Private Sector
”, Article 21 “
Bribery
in the Private Sector
”, Article 22 “
Looting of Property in the Private Sector
”, and Article 39
“
Cooperation between National Authorities and the Private Sector
”, provides recommendations
on identifying corruption risks and implementing a number of preventive measures to prevent
them. In particular, it specifically indicates the need for the state to take measures to ensure the
transparency of accounting and financial reporting, regulate accounting standards and internal
audit against corruption-related offenses in the private sector.
International standards and documents adopted by the Organization for Economic
Cooperation and Development (OECD).
The next category of international standards that play
a significant role in the fight against corruption is the conventions and international
recommendations adopted by the OECD.
The Convention of the Organization for Economic Cooperation and Development on Combating
Bribery of Foreign Public Officials in International Business Transactions, adopted on November
21, 1997, is the Convention of the Organization for Economic Cooperation and Development.
Here, we can cite the “
Management Guide on Internal Control, Ethics and Compliance
”,
which embodies the best practices and experiences in compliance services.
The Basel Committee on Banking Supervision, adopted in April 2005 (in a new edition), is a
document on banking supervision
“On Compliance and the Compliance Function in Banks”.
The recommendations of the Basel Committee on Banking Supervision, adopted in April 2005,
include the following recommendations for organizing a compliance control system in banks and
companies and organizing an anti-corruption policy by the compliance service:
create mechanisms to ensure the independence of the compliance service;
if there are cases where compliance control functions are performed by different departments of
the bank, in this case, the management should clearly distinguish between them through internal
documents, in which case it would be appropriate to designate the implementation of compliance
functions as the main activity of this service, since duplication of tasks affects the efficiency and
independent activities of the compliance service;
ensure the right of the compliance service to freely submit and disclose its conclusions on
corruption to executive bodies without any obstacles;
ensure that the compliance service regularly reports to the management on existing corruption
cases;
determine the status of the compliance service as subordinate only to the management, a number
of priority tasks were listed as recommendations.
The development of compliance services on US stock exchanges and in the US economy led to
the adoption of the
Foreign Corrupt Practices Act of 1977 (FCPA).
The FCPA established
strict rules of compliance, including strict requirements for accounting and financial reporting,
and strict rules on dealings with government officials to prevent corruption in the private sector.
In addition, the adoption of laws such as the Sarbanes-Oxley Act in 2002 created a US model of
the compliance control system, mainly for combating corruption in the foreign operations of
companies.
The next example of the formation of a compliance control system to combat corruption in the
global economy is associated with the legislation of the United Kingdom.
The UK Bribery Act
was adopted on April 8, 2010 and came into force on July 1, 2011.
The list of used literature:
1.
1. Timoshkin A.V. "Corporate compliance control as an instrument of economic security":
author's abstract. dis. ... candidate of economic sciences: 08.00.05 / Timoshkin A.V. - Moscow,
2010. - 32 p., [Electronic manba]. URL: https://www.dissercat.com;Primakov D. Compliance
2
Convention of the Organization for Economic Cooperation and Development on Combating Bribery of Foreign
Public Officials in International Commercial Transactions, adopted on November 21, 1997.
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practices: anti-corruption, banking compliance, sanction compliance and asset tracing– М.:
Infotropic media, 2019 – P.36. [Электрон манба]. URL:
2.
“
ISO 37001 - Anti-bribery management systems”//[Электрон манба]. URL:
https://www.iso.org/ru/standard/62342.html
3.
“
ISO 19600:2014 Compliance management systems-Guidelines”//[Электрон манба]. URL:
https://www.iso.org/ru/standard/62342.
4.
Sarbanes-Oxley Act of 2002. Corporate responsibility. // Public law 107. 204-july 30,
2002// [Электрон манба]. URL:
https://www.sec.gov/html#sox2002.
5.
Foreign Corrupt Practices Act 1977 // PL 95 - 213, Title 1; 91 Stat 1494, Dec 19, 1977//
[Электрон
манба].
URL:
/content/pkg/statute-91/pdf/statute-91-pg1494.
6.
The Dodd–Frank Wall Street Reform and Consumer Protection Act 2010// As Amended
Through P.L.115-61, Enacted 2010
[Электрон манба]. URL:
7.
UK Bribery Act of 2010
// [Электрон манба].
URL:
.
8.
Decree of the President of the Republic of Uzbekistan dated 02.02.2017 No. PP-2752 "On
measures to implement the provisions of the Law of the Republic of Uzbekistan "On Combating
Corruption" // [Electronic source]. URL: https://lex.uz/docs/3105125.
9.
Decree of the President of the Republic of Uzbekistan dated 27.05.2019 No. PF-5729 "On
measures to further improve the system of combating corruption in the Republic of Uzbekistan"
// [Electronic source]. URL: https://lex.uz/docs/4355387.
