New legislation to stamp out entangled interests

The hot topic of establishing rules for transparency is in the news again. The government plans to rationalize expenditures and curb waste in the public sector by establishing transparency in every aspect of public life. A few days ago, Athens Chief Prosecutor Dimitris Papangelopoulos ordered a wide-ranging preliminary investigation into Defense Ministry procurements, in particular for the purchase of Russian Tor-M1 anti-aircraft missile systems and into the merger of EBO and PYRKAL. Incompatibility Meanwhile, Justice Minister Anastassis Papaligouras has raised the issue of the incompatibility of media companies, construction firms for major projects and public suppliers. This is constitutionally established, but the legal regime of the majority shareholder has come under criticism because it permits relatives to appeal to «economic independence.» «A major contractor and public sector supplier cannot also be a media owner,» stated the minister. The government has already kept its election campaign promise of drafting legislation to establish an independent authority to oversee and monitor publicly contracted projects, supplies and services. The authority will be charged with seeing that transparency regulations are complied with and making studies to stipulate the future of the contracts. As part of the changes in the pipeline, the government will replace the current type of tender used for projects, which has been shown to hinder free and healthy competition in assigning and completing public works. Sources say the new system will be a modern, transparent institutional framework based primarily on full, completed studies, the terms of which must be followed unswervingly. Deviations Also due for abolition are the many existing deviations from the legislation on state supplies, so that contracts with agencies supplying water, energy, transport and communications are subject to guarantees of transparency and reliability. Similarly, some clauses in Article 16 of Law 24467/1996, which allow widespread and unacceptable deviations from the legislation on state supplies, will be abolished. These deviations allowed a number of contracts to be assigned in a suspect fashion and to preselected firms. As for the media, the government will establish full, ongoing scrutiny of the share capital of media companies so as to prevent any entanglement of interests. The law will prohibit foreign firms from owning share capital in media companies. The percentage of the majority shareholder will also be reduced to the minimum possible, so as to close a constitutional loophole that allowed entangled interests in the media. Nor will extraneous individuals, relatives or others be permitted to own share capital or work in the administration of media companies. This will do away with an existing regulation that allows such persons to be used, provided they could demonstrate that they were economically independent.

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