Managing conflict of interest in performing public duties in Vietnamese law

The current laws of Vietnam on the managing conflict of interest in performing public duties include the principles and mechanisms, measures to manage conflicts of interest to prevent a[r]

MANAGING CONFLICT OF INTEREST

IN PERFORMING PUBLIC DUTIES IN VIETNAMESE LAW

Dr Dinh Thi Huong Giang

Ho Chi Minh National Academy of Politics, Vietnam

Abstract

In the world, conflict of interest in performing public duties is a problem that many countries pay special attention to, because it poses a great risk of corruption To manage conflict of interest

in performing public duties, many states, including Vietnam, have applied various methods and measures, with different tools, in which the most effective is the law

This paper analyses and evaluates the situation of Vietnamese law on managing conflict of interest

in performing public duties The author argues that the attempt of the State of Vietnam in this area

is aiming to supplement and legalize the provisions of the United Nations Convention on Anti-Corruption, as well as to establish a legal framework for the prevention and treatment of conflict of interest to anti-corruption and to build an integrity Government and transparency and effective civil service background The author also pointed out the limitations of the law on managing conflict of interest in performing public duties in Vietnam with domestic and international situations such as not ensuring the comprehensiveness, suitability, and feasibility Finally, the author proposed solutions

to improve the current legal framework of managing conflicts of interest in performing public duties, consistent with the progressive view of most countries in the world and practices of Vietnam.

Keywords: conflict of interest; Anti-Corruption; Vietnam

Introduction

According to the Organization for Economic Co-operation and Development (OECD), managing conflict of interest in performing public duties is “a contradiction between public obligations and personal interests of a civil servant in which personal interests of civil servants have adverse influences

on the fulfilment of their public duties and responsibilities “1

In the world, conflict of interest in performing public duties is a problem that many countries pay special attention to, because it poses a great risk of corruption Managing conflict of interest

in performing public duties also help to prevent corruption effectively, so currently, in the world, managing conflict of interest in performing public duties is considered one of the core measures in the

1 OECD (2006), “Conflict of Interest Policies and Practices in Nine EU Member States: A Comparative Review’’, on page http://www oecd.org/officialdocuments/publicdisplaydocumentpdf/?doclanguage=en&cote=gov/sigma(2006)1/ rev1 [accessed on 12/4/2017].

fight against corruption In their attempt to manage conflicts of interest, many states use many tools

in which legislation is the most critical control tool

1 Legal framework for managing conflicts of interest in performing public duties in Vietnam

The current legal system on managing conflict of interest in performing public duty activities of Vietnam reflects the elements of the 6-letter R (6Rs) conflict of interest management model that the OECD has initiated and is currently implementing

Specifically, in the current law of Vietnam, some provisions on situations are considered to be conflicts of interest (corresponding to REGISTER) The provisions on restricting and limiting personal participation in positions and rights represent a conflict of interest (corresponding to RESTRICT) There are some regulations on supervision and evaluation of the behaviour of powerful and high-ranking people when participating in situations of interest conflict (corresponding to RECRUIT) There are also regulations aiming to prevent such powerful people from participating in unfeasible circumstances (corresponding to REMOVE) Other provisions include those obligating people in important and powerful positions give up personal interests (such as ownership of shares, membership

in an organization, and so on) to avoid conflict of interest situations (corresponding to RELINQUISH); and to resign in a certain conflict of interest situations (corresponding to RESIGN) In the context of

a developing country like Vietnam, the development of a legal framework for controlling conflicts of interest under the OECD’s 6-letter R model shows the great efforts and broad vision of legislators

Vietnam’s current legal system for managing conflicts of interest in performing public duties shows a combination of principles-based approaches1 and rules-based approaches2 In fact, in Vietnamese laws, there are provisions regulating the general principles of conduct of cadres, civil servants, and public employees in public-service activities, and those outlining situations of interest conflict This combined approach appears to be appropriate in the context of developing countries like Vietnam, as it takes full advantage of both approaches

Comparing with the criteria to improve the law on managing conflict of interest in performing public duties, the current legislation in this field of Vietnam has some fundamental advantages as follows:

(1) The law has built a system of rules that are relatively uniform and synchronous in managing conflict of interest

1 This approach is characterized by its emphasis on laying out the general principles of civil service conduct in public service, based on the philosophy that conflicts of interest in the public sector are primarily ethical rather than ethical or legal issue Because of possessing general framework principles, the laws based on this approach are basically stable even when socio-economic conditions have specific changes However, due to general provisions, the implementation

of these regulations may have different interpretations, leading to the handling of conflict of interest situations.

2 Under this approach, the State regulates specific situations that are deemed incompatible with the position and responsibility assigned or in conflict with public interests and public duties in the law According to this approach, the standards of civil servant behavior are expressed in the form of legal regulations, helping to identify specific situations

in which civil servants’ conduct is considered inappropriate in correspondence to their tasks and responsibilities assigned However, these standards are ultimately grounded on the basic principles of public service to resolve conflicts

of interest This approach’s benefit lies in the fact that thanks to its clear and transparent rules, misinterpretation and ambiguity during the process of controlling conflicts of interest will be avoided

The Law on Anti-Corruption provides for principles and specific requirements on publicity, transparency, and prevention of conflicts of interest in the organization and operation of the state apparatus, which are typically the same as the regulations on Restrictions apply to officials, civil servants and employees related to business activities, part-time jobs, jobs after retirement, gift-giving, gift receipt and so on

These provisions are also mentioned in many other legal documents such as the Law on Cadres and Civil Servants 2008, Law on Public Employees 2010, Bidding Law 2014, and Audit Law 2015,

to name a few Laws vary, but the content is uniform and relatively high

The uniformity and consistency of laws on managing conflict of interest in performing public duties are also featured by compatibility between Vietnamese laws and those of the UNCAC, to which Vietnam is a member Over the past years, Vietnam has gradually built a legal system related to conflict

of interest management and has formed a legal basis for the prevention, detection, and handling of conflicts of interest following the UNCAC’s regulations and practice Despite its limitations, the legal system has become a tool to control conflicts of interest in public service activities, and therefore contributes to the prevention and fight against corruption As a result, it helps to ensure objectivity and integrity in official duties

(2) The law shows the conformity with the political, economic and social conditions of Vietnam

Over the past years, the legal provisions for managing conflict of interest in performing public duties have been gradually improved, clearly demonstrating the Party’s political determination and State policies based on conformity with political, economic, social conditions, and the integration trends in the country

Developing societies consider anti-corruption and people’s expectations of the integrity of the bureaucracy a must In contrast, a developing country in transition, like Vietnam, is expected to handle the issue of anti-corruption in general and managing conflict of interest in particular in the long term Legal provisions on these issues should, therefore, be elaborated and strengthened to meet the requirements of the society in the fight against corruption and to be compatible with the characteristics

of the political system and the competence of authorities Vietnam’s current regulations on managing conflict of interest reflect that approach, reflected in the goal of building effective administration, government integrity, good governance, create the trust and belief of the people, step by step prevent and promptly handle conflicts of interest in performing public duties

(3) The law tries to ensure the balance of interests of the State, cadres, civil servants, public employees, and people, which prevents corruption

The current laws of Vietnam on the managing conflict of interest in performing public duties include the principles and mechanisms, measures to manage conflicts of interest to prevent and fight against corruption, to establish a foundation integrity and professionalism with a staff of cadres, civil servants and professional officials with integrity to serve the people and society

In addition to ensuring the interests of the State and society, these regulations secure the interest

of cadres, civil servants, and public employees in such a way that harmonizes both the collective interest and individual interest Regarding the collective interest, the current laws and regulations on managing conflicts of interest in performing public duties require officials, civil servants, and public

officials to carry out their duties with integrity and to always prioritize the benefits of the State in situations of conflict of interest Individuals are required to be fully responsible for their behaviours and evaluated based on their nature and level of violation

Regarding personal interest, the law also stipulates that personal freedoms of cadres, civil servants, officials, and their relatives are protected from all acts of arbitrary abuse Such protection is made possible

by processes and careful procedures to prevent unlawful actions The legal provisions on managing conflicts of interest in performing public duties guarantee openness, transparency, and feasibility

The current legal framework of Vietnam has provided a system of measures on managing conflicts of interest in performing public duties that have been being implemented successfully by many countries such as regulations on publicity and transparency of assets and incomes of individual

in important and powerful positions and regulations on restricting personal interests of officials and employees, to name a few

Concerning the education aspect, it is evident that specific regulations or written documents are not found in Vietnamese laws, detailing how to raise awareness and encourage more active participation among the cadres, civil servants, and public officials related to supervision and monitoring the compliance of regulations and laws However, there are general regulations on the education and propaganda to raise awareness about policies and laws on anti-corruption and the role, responsibility, and involvement of the whole society in anti-corruption activities

2 Restrictions of current laws on managing conflict of interest in performing public duties of Vietnam

Although Vietnam’s current legal system for managing conflicts of interest in performing public duty operations has primarily reflected all elements of the conflict of the interest management model, namely 6 R-letters (6Rs) of the OECD, it lacks uniformity and coherence Specifically, on the one hand, some provisions are specific and detailed, including rules on situations are considered

to be conflicts of interest (corresponding to REGISTER); provisions on restricting and limiting the personal participation in positions and rights represent a conflict of interest (corresponding to RESTRICT); banning regulations to prevent such powerful people from participating in unfeasible circumstances (corresponding to REMOVE) On the other hand, complaints are heard about the other provisions, for example, regulations on supervision and evaluation of the behaviour of powerful and high-ranking people participating in situations of interest conflict (corresponding to RECRUIT), provisions obligating people in important and powerful positions to give up personal interests (such

as ownership of shares and membership of an organization) to avoid conflict of interest situations (corresponding to RELINQUISH); and those requesting such people to resign in certain conflict

of interest situations (corresponding to RESIGN) This weakness makes the entire mechanism of managing conflicts of interest less effective

Vietnam’s current legislative system for managing conflicts of interest in performing public duties includes provisions that reflect both principles-based approaches and rules-based approaches However, the combination of the two methods fails to show coherence between regulations on general principles and those on specific situations of conflict of interest, thus hindering application and reducing the effectiveness and efficiency of the entire legal system in this field

Considering the criteria for law improvement, the author of this article argues that the following

issues need to be addressed:

(1) The lack of comprehensive law on managing conflict of interest in performing public duties due to insufficient data to manage conflict of interest in performing public duties

Firstly, this limitation is indicated through a lack of regulations on publicizing the operations of

cadres, civil servants, and public employees in bidding activities There are currently no regulations on publicizing overtime work, post-employment, employment of officials, public servants and officials, which are often blamed for having caused conflicts of interest Although the law requires transparency in some procurement decision-making processes (e.g information from violating individuals /organizations, information on handling the violation), some information concerning the bid selection process, such as reasons for the approval or rejection of the contractor, are not disclosed However, these problems result in potential conflicts of interest during the bidding process for public investment projects

Secondly, regulations on restricting personal interests of cadres, civil servants, and public

employees are still incomplete There are currently laws on restricting the personal interests of public officials, servants, and employees, such as restrictions on gifts, part-time jobs, and jobs after retirement However, there are no regulations on restricting or controlling extended family members, relatives, and friends of cadres, civil servants, and officials Meanwhile, in reality, their benefits are brought about by family members and friends of cadres, civil servants, officials through the so-called backdoor businesses, or a leak of information In other words, this deficiency explains the existence of some forms of conflict of interest in the official duties of cadres, civil servants, and public employees

Specifically, the Bidding Law restricts public employees’ participation in the bidding process, but

these restrictions have just taken effect on certain subjects Cadres, civil servants, and officials (and family members of cadres, civil servants, public employees) who are not managers of state-owned enterprises or heads and deputy heads of enterprises are not subject to this adjustment Besides, this provision is not applied to extended members of families and other relatives, such as friends of officials, public servants, and officials Also, these restrictions do not apply to cases of employment arrangements for family members of those having higher positions or lower positions, even among employees across other State agencies, organizations, units, and enterprises

At present, the law does not have adequate regulations on preventing cadres, civil servants, and public officials from occupying positions related to monitor and implement policies According to the law, a governmental official is not allowed to have a member of the Standing Committee of the National Assembly at the same time Nevertheless, there are no restrictions on occupying positions

of policy making and implementing, such as Vice President of the National Assembly Similarly, at the local level, members of the People’s Committee are not permitted to hold the same level positions

of the Standing Committee of the People’s Council; however, there are no restrictions on policy planning and implementing jobs, for example, Vice President of People’s Council

In addition, the law of Vietnam has not documented limitations of preventing conflicts of interest applied to officials working in sociopolitical organizations such as the Vietnam Fatherland Front, the Vietnam Veterans Association, Vietnam General Confederation of Labour, Vietnam Women’s Union, Vietnam Farmers Association and Ho Chi Minh Communist Youth Union and sociopolitical-professional organizations such as the Law Society Vietnam, Vietnam Journalists Association These

organizations are considered the “extended arm” of the State, and they have been carrying out many activities assigned by state authorities An estimate of thousands of billion is deducted from the State budget by these organizations

Another problem is adequate regulations on identifying and handling conflicts of interest The current law does not specify the responsibilities of individual officials and employees in detecting and resolving conflicts of interest The only responsibility involving personal interest is an individual’s obligation to declare annual assets and income, which supports the recruitment, appointment, and dismissal of officials and public employees

The current laws also do not have clear regulations on the responsibility of the State and social agencies in recognizing and resolving conflicts of interest The implementation of anti-corruption rules (including restrictions on conflicts of interest) is currently assigned to many agencies, most of which do not have expertise in conflicts of interest and public service activities

Although the law has a system of regulations for resolving complaints and accusations of corruption in general and conflicts of interest in particular, in theory, anonymous accusations are not handled (except for cases where anonymous complaints about “corruption” are very “clear and provides strong evidence proceed further investigation”) That the assignment of resolving complaints

is assigned to the managing agency managing officials and public employees hinders the objectivity and makes the resolution more difficult

(2) Inconsistent and unfeasible legal provisions for managing conflict of interest in performing public duties

Regulations on gift-giving control remain unspecific, failing to clarify responsibilities of state agencies in receiving and promptly handling reports on gifts of officials, public servants, and public employees There are also no clear regulations on how to deal with violations At present, the law only requires involved agencies and groups to give notifications to responsible agencies and units for further consideration and resolution, but procedures for doing so have not been specified

Regulations on handling the responsibilities of cadres, civil servants, and public employees when performing official duties and duties are not clear and specific For example, accountability in carrying out assigned duties is stated in Decree No 59/2019 / ND-CP but has not specified the handling of violations when the presenter fails to implement them earnestly Sanctions against breaches of the regulations or restrictions on working overtime after retirement are not apparent There are no specific regulations on the use of published information on recruitment, promotion, and bidding results in investigating and detecting violations

(3) A lack of legal documents regulating the implementation details, detection, and handling of conflict of interest in performing public duties

The legal system for managing conflicts of interest in performing public duties is fragmented Some provisions of the Anti-Corruption Law and related legal documents are just limited to general principles and framework law There is an absence of legal documents detailing implementation, conflict

of interest restriction, processes of dealing with conflicts of interest, and disclosing conflicts of interest

In other words, legal provisions for managing conflicts of interest in performing public duties have not been systematically and comprehensively developed There is a missing link between

relevant current regulations and reference regulations, which fails to facilitate the implementation of the law on managing conflicts of interest

Limitations of the law on managing conflict of interest in performing public duties in Vietnam derive from three causes The first reason is the limited awareness and legal knowledge about managing conflict of interest in performing public duties in Vietnam In fact, both legislators and social communities are not fully aware of the role and meaning of managing conflict of interest

in performing public duties Secondly, a lack of adequate, consistent, informative, and transparent mechanisms and policies as well as missing consistent legal infrastructure and progressive governance on socioeconomic management in different areas in Vietnam results in ineffective and deficient management and measures to meet the requirements of the socioeconomic development and

to manage conflict of interest in performing public duties The third reason is attributed to limited legislative techniques of state agencies

3 Solutions to improve the law on managing conflicts of interest in performing public duties in Vietnam

3.1 Reviewing, systematizing, and evaluating current legal documents related to managing conflict of interest in performing public duties

Despite its reinforcement in the Law on Anti-Corruption in 2018, the current legal system on managing conflict of interest in performing public duties remains weak and therefore needs to be revised and supplemented for an improvement

In order to achieve the purpose as mentioned earlier, reviewing and systematizing the current legal regulations on this issue should be prioritized It is because such regulations are dispersed in many specialized legal documents with several gaps and shortcomings

Besides, to address the shortcomings, it is necessary to study, summarize, and evaluate the actual implementation of the law for managing conflict of interest in performing public duties This process is expected to identify incompatible or non-feasible regulations, causes, and requirements for appropriate amendment and supplementation of those regulations

It is suggested having two options for systematization:

Option 1: Systematizing legal regulations on managing conflict of interest in performing public

duties and codify them into a separate legal document on conflict of interest

Option 2: Maintaining both form and content of the current regulations on managing conflict

of interest in performing public duties, with modification and supplementation of appropriate legal provisions and systematization and legalization of techniques

3.2 Amending and supplementing current regulations on managing conflict of interest in performing public duties

- Addition of criteria to identify situations of conflict of interest in performing public duties

- Addition of principles in preventing and handling conflicts of interest

- Amendment and supplementation of prevention regulations on conflict of interest, namely, supplementing regulations on transparency and publicity; adding restrictions on the personal interests

of cadres, civil servants, and public employees; adding regulations related to gifts and extra work while working or after retiring in the public sector; supplementing regulations on limiting the amount

of civil servants’ capital or shares/shares; and adding restrictions regarding the relatives

- Amendment and supplementation of regulations detect conflicts of interest: Laws need to supplement regulations on inspection and self-inspection of agencies and units Also, cadres, civil servants, and public employees should actively investigate situations of conflict of interest as well

as raise awareness of the regulations on the role and responsibilities of the State so that cadres, civil servants, and public employees are guided in their process of proactive prevention, detection, and handling of conflict of interest

Furthermore, the law also needs to supplement regulations that allow the detection of conflict of interest in performing public duties through inspection, audit, and supervision activities, as well as through receiving and processing information about conflict of interest There should be regulations for cadres, civil servants, and public employees themselves to actively detect their situation Determining any issues related to your interests may affect the performance of the assigned responsibilities, tasks, and circumstances of conflict of interest The proactive assessment and detection of conflict of interest depend mainly on the awareness and attitudes of cadres, civil servants, and public employees

To enable cadres, civil servants, and public employees to determine the situation of conflict of interest, state agencies needs to issue regulations, a set of guideline questions concerning conflict of interest to provide a basis for their identification of conflict of interest situations The fulfilment of duties and the probable influence of individual interest in the fulfilment of such duties are raised

- Amendment and supplementation of regulations on handling conflict of interest:

(1) Supplementing the process of handling conflict of interest

- In the case of cadres, civil servants, and public employees being aware of a case of conflict of interest, within three days, they are responsible for reporting to the leader and immediate superior for further consideration and handling In the event of detecting any difficulties, agencies, organizations, and individuals must report to authorized individuals for review and handling within three days

- Upon receiving information and reports on the conflict of interest, that individual is required to process or to report to the authorized person in his/her measures of managing conflict of interest in performing public duties

Notably, it is necessary to supplement regulations on the order and procedures for verifying the information, to report about conflict of interest for clarifying the contents of explanation of conflict

of interest The need to add regulations on deciding to validate conflicts of interest, validating, concluding, and publicizing conclusions should also be emphasized

(2) Supplementing regulations to handle cases of violating regulations on conflict of interest

Laws should be based on different conflicts of interest situations to determine appropriate forms

of treatment The handling of conflict of interest should be considered a regular activity of agencies, organizations, and units Based on the approach of the 6Rs theory of OCED, it is necessary to take the following measures:

- Limiting the participation of cadres, civil servants, and public employees in a particular process

or activity that is likely to cause conflicts of interest:

- Supervising the performance of duties of people with a conflict of interest

- Suspending the performance of tasks and public functions:

- Requesting giving up personal benefits:

-Transforming those in positions of conflict of interest

- Resigning

Moreover, the law also needs to supplement regulations on handling cadres, civil servants, and public employees who violate regulations on managing conflict of interest in performing public duties The universal principle is that the nature and level of violation should be adopted to judge any legal penalty or punishment so that all individuals fairly apply the laws Last but not least, the issue

of handling properties derived from any violations need to be addressed

3.3 Raising awareness of cadres, civil servants, public employees and people about conflicts of interest and promotion of the role of society in preventing conflicts of interests in performing public duties

As mentioned in the above sections, the awareness of cadres, civil servants, public employees, people, and enterprises about the issue of conflict of interest in performing public duties is still limited, mainly because of undue attention paid to legal dissemination and education At present, although the State has developed a legal education and propaganda program, all the content related to conflict of interest is missing This gap raises the need to do marketing and educating the employees

in particular, and the public in general, to be more aware of this issue

3.4 Creating favourable conditions for perfecting the law on managing conflict of interest in performing public duties

A review of the current regulations in Vietnam indicates that the processes of researching, developing, and proposing a legal document to authorized organizations must go through many complicated steps Therefore, it is essential to create favourable conditions to facilitate these processes Firstly, in terms of human resources, it is necessary to make sure both the quantity and quality of officials meet the requirements, namely, a sufficient number of competent and qualified staff who can take part in the development of legal documents on managing conflict of interest in performing public duties This requirement raises the necessity for developing strategies and policies to attract, mentor, and assign the positions to competent officials for their involvement

Secondly, in terms of financial resources, the issues of preparing for adequate and timely allocation of funds for enacting documents and improving the legal system and implementing the law are considered essential

3.5 Enhancing international cooperation for building and enforcing the law on managing conflict of interest in performing public duties

The issue of managing conflict of interest in performing public duties is relatively new in Vietnam, but it has been familiar with many countries in the world, which have much knowledge in

their legislative implementation practices The new context requires Vietnam to enhance international cooperation for learning and gaining experience from other countries concerning how to manage conflict of interest, which remains a relatively new issue compared to other matters related to anti-corruption in Vietnam

Conclusion

After more than 30 years of renovation, Vietnam has achieved many achievements in all fields

of economy, culture, and society Along with socioeconomic development, the relationship between the State and the private sectors tends to be commercialized, which makes public services more and more vulnerable to conflict of interest situations When conflicts of interest are not identified and controlled, the integrity of agencies, organizations, and units and may suffer and result in corruption Therefore, it is inevitable to improve the law on managing conflict of interest in performing public duties, thanks to its direct impacts on an improved legal system in general and especially with the process of administrative reforms and anti-corruption acts in Vietnam This requirement should be undeniably prioritized

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