Licence granting to be made more transparent

The government's anti-corruption unit has proposed a new system of granting export and import licenses, an area which experts say is heavily corrupt and murky.
The unit, lead by Deputy Prime Minister for Economy Ivan Mikloš, presented its concept of new rules for giving out the licenses November 27, and is hoping they will take effect in January next year.
However, anti-corruption experts such as Emília Sičáková, head of the Transparency International Slovakia watchdog, said such plans were unrealistic "although it would be great if the proposal took effect as soon as possible".


"License granting is one of the most corrupt areas according to our research. Firms who applied for licenses simply say the only decision-making criteria is 'the one who gives a bigger bribe gets the license'."

Emília Sičáková


The government's anti-corruption unit has proposed a new system of granting export and import licenses, an area which experts say is heavily corrupt and murky.

The unit, lead by Deputy Prime Minister for Economy Ivan Mikloš, presented its concept of new rules for giving out the licenses November 27, and is hoping they will take effect in January next year.

However, anti-corruption experts such as Emília Sičáková, head of the Transparency International Slovakia watchdog, said such plans were unrealistic "although it would be great if the proposal took effect as soon as possible".

"License granting is one of the most corrupt areas according to our research. Firms who applied for licenses simply say the only decision-making criteria is 'the one who gives a bigger bribe gets the license'," she said.

Referring to the findings of the 2000 World Bank's Diagnostic Survey on corruption in Slovakia, Mikloš said the average bribe for obtaining a license was Sk14,000 ($290). Without a license firms cannot import or export goods.

Estimating that about 5,000 of the total 19,360 licenses granted by the Economy Ministry in 2000 were given out in turn for a thick envelope, the report said that firms had paid about Sk70 million in bribes ($1.4 million).

The new license system aims to abolish 84% of all licenses, thus decreasing the work load of the license commission. It will also set clear rules to narrow or eliminate space for corruption.

At the moment, there are two kinds of licenses: automatic, and non-automatic. The former relates to goods for which the amount of import and export is not specifically defined in bilateral or international treaties. Non-automatic licenses relate to goods whose import or export amounts are limited by a special treaty, for example Czech beer which can be imported in only limited quantities to Slovakia.

The existing system has all firms interested in importing or exporting any goods, such as agricultural, manufacturing or various consumer products, applying to the Economy Ministry's license department.

The ministry's license commission decides who gets a license but does not have to explain its decision to unsuccessful applicants. Kamil Katrenič, an analyst with the cabinet's anti-corruption unit says this decision-making process is "long, unclear and subjective" leaving plenty of room for corruption.

"The commission is supposed to rule within 15 days on an automatic license, and 30 to 60 days on a non-automatic license, but often these deadlines aren't kept. Secondly, if a firm isn't successful it has no right to request an explanation as to why it wasn't obliged," Katrenič said.

He added that changing the system would enable the introduction of five-day deadlines for meeting license requests.

According to the World Bank corruption survey, in 21% of cases firms asking for export licenses gave bribes to decision makers.

Mikloš said that if other forms of influence such as political connections or nepotistic practices were added to the bribes, 53% of licenses were granted non-transparently.

A similar situation exists with import licenses: 31% of firms admitted to giving a bribe, while the total number of non-transparently granted licenses was 55%.

Economy Ministry spokesman Peter Chalmovský admitted that a change in the method of license granting was needed, but noted that some parts of the cabinet anti-corruption unit's proposal might "endanger certain international business commitments of the Slovak Republic".

When asked by The Slovak Spectator December 4, Chalmovský was not able to give a concrete example of what commitments he meant.

"Our license department is preparing an official statement with comments on the proposed new system. It should be ready by next week," he said.

After the anti-corruption unit receives the statement from the Economy, Finance, and Foreign Ministries, the proposal will be discussed in the cabinet's legislative council.

Transparency's Sičáková hopes for a speedy passage of the new license system. "It's very, very necessary that a change come soon."

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