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Political Party Finance
Regulation of campaign financing is a huge effort
and a difficult undertaking in any democracy. However, it is certain
that initiating this regulation process in BiH will help voters
and political parties decrease non-democratic influence in future
elections. In this way the control of corruption, promotion of fairness,
expenditure control and promotion of responsible and representative
political parties and elected officials, will be made possible.
Campaign financing was regulated for the first
time during the 2000 general elections. The campaign financing regulations
consisted of four key components: disclosure, donation limits, spending
limits, and enforcement.
Disclosure
The disclosure provisions were taken from the
draft election law and incorporated into the rules and regulations
to make them applicable to the 2000 general elections. The disclosure
provisions required political parties to file reports with the Provisional
Election Commission (PEC) detailing their income and expenditures
prior to the elections and again following the elections.
The disclosure form asked for the following
information:
- All cash on hand;
- All incomes and disbursements based on memberships, contributions
from abroad, contributions from individual and legal entities,
contributions in form of goods and services (hereinafter referred
to as "in-kind contributions"), returns on its own assets and
entrepreneurial activities, credits, loans, donations, rebates,
refunds, other operating expenditures, and other sources for the
reporting period as determined by the PEC;
- Identification of the person or source of any payment and in-kind-contributions,
as well as the identification of a person who received that payment,
in excess of one thousand (1,000 KM) convertible marks together
with the date and amount of any such receipt;
- The total amount of all accounts payable and total amount of
disbursements in the following categories: direct costs for political
campaign, operating expenses, costs associated with entrepreneurial
activity, and other costs; and
- The amount and nature of outstanding debts and obligations
owed by or to the person who files the report and, where such
debts and obligations are settled for less than their reported
amount or value, a statement as to the circumstances and conditions
under which such debts or obligations were extinguished.
Donation limits
The donation limit was included in the BiH Law
on Party Financing that was adopted by the BiH Parliament in July
2000. That law placed a limit on how much money a private company
or individual was allowed to donate to a political party each year.
The limit was calculated by the PEC pursuant to the Law on Party
Financing and amounted to 3,656 KM. In addition, parties were prohibited
by both the PEC rules and the Law on Party Financing from accepting
any donations from public companies. The limit on donations is intended
to prevent wealthy individuals and companies from exercising too
much influence on the political process. The ban on donations from
public companies is meant to separate politics and economics and
reduce the potential for conflicts between interests of political
parties and the general economic interests of the country.
Spending limits
Ninety days before Election Day, the PEC announced
the number of voters entered on the Central Voters Register for
each electoral race. That was the parameter for political campaign
expenditure and spending limits. A political party or a candidate
running for elections shall not spend more than one convertible
mark per voter in each electoral race for the purpose of the election
campaign.
The spending limit helps to create a more equal
playing field between the bigger wealthier political parties and
the smaller parties.
Enforcement
The Provisional Election Commission enforced
all of the campaign and political party financing regulations. Even
provisions of the BiH Law on Party Financing were enforced by the
PEC because a BiH Election Law has not yet been adopted by Parliament.
PEC enforcement included the capacity to audit the financial records
of political parties. Once a national election law is adopted and
a national election commission established, enforcement of party
financing and campaign financing will be the responsibility of the
national election commission.
Many political parties had a difficult time adapting
to the new regulation of campaign and party financing. That is to
be expected whenever new legislation is adopted. However, some parties
clearly took their new legal obligations more seriously than others.
Recent decisions and sanctions decided by the Election Appeals
Sub-commission (EASC) regarding political party finance
At its session on March 23, 2001, the Election
Appeals Sub-Commission (EASC) issued three summary decisions and
two individual decisions regarding alleged violations of the campaign
financing requirements set out in the Rules and Regulations and
the state Law on Political Party Financing5.
The EASC found that nine parties failed to file
financial disclosure forms (FDFs) by the deadline of December 28,
2000, or failed to file an FDF at a proper location, as was the
case for the Party of Democratic Center of Cazin. All of the parties
were censured for failing to file FDFs by the deadline and thus
violating Article 1601 in the Rules and Regulations (which requires
political parties to file FDFs with the PEC no later than thirty
days after the PEC publishes the results from the November 11, 2000
general elections) and were warned that any future violations of
the campaign financing requirements could affect their right to
participate in elections in BiH.
The EASC found that twelve parties failed to
complete FDFs properly. The most common violation was failure to
include all payment bureau accounts on the FDFs. The EASC did note,
however, that all of the parties responded to the PEC's request
for additional information regarding payment bureau accounts when
requested to do so.
The EASC also considered thirteen referrals
from the PEC regarding possible violations of campaign financing
requirements by six parties: the Party of Democratic Progress (PDP),
the Serb Democratic Party (SDS), the Social Democratic Party of
BiH (SDP), the Socialist Party of RS (SPRS), the Party for BiH (SBiH)
and the New Croat Initiative (NHI). As in the previously cited cases,
the EASC found that all the parties failed to complete the FDFs
properly. The parties were censured for these violations of Article
1601. The EASC also found additional violations of Article 1601.
The PDP failed to report expenses for billboard space; the SDS Pale
Office failed to report debts and the names of creditors; the SDP
failed to disclose the costs for the rental of billboards and the
printing of posters, and an in-kind contribution from Europlakat;
the SBiH in Central Bosnia Canton (Canton 6) failed to report campaign
expenses from two companies; and the NHI failed to report the costs
of newspaper advertising. The parties were censured for these additional
violations.
Aside from these summary decisions, the EASC
also took decisions in individual cases concerning the SDA and HDZ.
The SDA was censured for failing to report all of its payment bureau
accounts, and the SDA Main Office was censured for under-reporting
or failing to report campaign expenses as well as an in-kind contribution
from Europlakat. The EASC also found that the SDA Tuzla Office failed
to properly report a payment of KM 20,000 from Foto Blicko, and
payments of KM 25,000 and KM 15,000 from the organization Omladinski
Savez. The EASC noted that two party officials were misleading,
hostile, and aggressive towards OSCE auditors during the review
of the party's records. The EASC also noted the similarity between
this case and a previous case where the SDA was sanctioned for obstructing
an OSCE audit team and directing, controlling, and using the funds
of Organizacija Porodica Sehida I Poginulih Boraca (Organization
of Families of Fallen Soldiers).
As sanctions, the EASC requested the resignation
of the accountant/bookkeeper of SDA Tuzla Office, and the resignation
of the Vice President of the SDA from Tuzla Canton (Canton 3) by
March 27 or face further sanctions from the EASC, including the
possible removal of SDA mandates won in the November 2000 general
elections. The EASC also removed the SDA Vice President, Tuzla from
the Cantonal Assembly of Tuzla Canton, Constituency 203. He may,
however, be replaced by the SDA candidate who received the second
largest number of votes for Cantonal Assembly, Canton 3, Constituency
203, in the 2000 general elections.
In the last case, the Croat Democratic Union
(HDZ) was censured for failing to report all of its payment bureau
accounts. The HDZ was also censured for under-reporting or failing
to report campaign expenses and in-kind contributions. In determining
the sanction, the EASC considered submissions from OSCE auditors
that the HDZ fully cooperated with the review of their records,
in direct contrast to the party's previous obstruction noted in
prior cases.
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