19-00933
African Governance Report VI
Institutional Architecture to Address Illicit Financial Flows from Africa Draft Case Study Guidance Notes
The purpose of this note is to provide guidance for data collection missions for the AGR VI report. The Note is divided by chapters and provides structure for what information is required by chapter. Each section provides an overview of the chapter, broad open-ended questions and 5-6 key areas that the interviewer should elaborate on. The right-hand column provides potential resources for the chapter, which include relevant institutions and/or data sources. These may vary from country to country.
Background & Country context: The purpose of this section is to provide economic and social context for each country case study including any characteristics that are particularly relevant to IFFs. This section can be populated using desk based research preferably ahead of in-country research.
Research areas (pre-country visit) Suggested resources
Data on size and characteristics of the economy including key economic and social indicators. Summary should also include (but not limited to) figures on growth; major industries; natural resource revenues; unemployment; and FDI flows.
These should be presented as percentage of GDP where appropriate (latest figures) and for natural resource data, disaggregated by type of primary commodity if possible, e.g.
x percent from mining, timber, oil etc.
Data on 2017 financial flows: either in
“billion US dollars” or percentage of the country's GDP. Flows should capture:
national and international private and public flows.
Data on debt vulnerability: including current level of indebtedness; and debt trends over the last 5-10 years.
Data on the amount of exports (keeping the unit price of exports constant) increased/
decreased in 2017 and imports
National Statistics Offices
World Bank: World Development indicators IMF: Country reports and debt profiles AfDB: African Economic Outlook 2019
National sector Ministries and/or Treasury websites
National Institute of Statistics of Tunisia http://www.ins.nat.tn/
Central Bank of Tunisia
https://www.bct.gov.tn/bct/siteprod/index.jsp
ECA Country profiles
https://www.uneca.org/oria/pages/eca- country-profiles
OECD
ITCD/UNU-Wider
https://www.ictd.ac/publication/the-ictd- government-revenue-dataset/
2 increased/decreased (keeping the unit price
of imports constant).
Tax revenues are about (add figure) percent of GDP for 2017.
Main drivers of IFFs: macroeconomic factors; structural factors and governance factors. [to be elaborated/validated during in-country discussions].
UNCTAD STAT
https://unctadstat.unctad.org/EN/
UN COMTRADE Database https://comtrade.un.org/
World Governance Index
Trade Openness Index
https://data.worldbank.org/indicator/ne.trd.g nfs.zs
World Customs Organization: Illicit Financial Flows via Trade Mis-invoicing Study Report
2018(http://www.wcoomd.org/-
/media/wco/public/global/pdf/media/newsro om/reports/2018/wco-study-report-on- iffs_tm.pdf?la=en)
The Central Bank of West African States (BCEAO):
https://www.bceao.int/sites/default/files/201 7-12/2016_annual_report_1_0.pdf
Chapter 2: National institutional architecture to address trade mis-invoicing and smuggling (including natural resources theft): The purpose of this section is to provide information on the role of national institutions and the effectiveness of structures to address trade mis-invoicing and smuggling. Particular attention should be given to customs regulations, customs authorities and the role of information-sharing.
Research questions Suggested resources
Describe the country’s national institutional architecture to address trade mis-invoicing and smuggling (including natural resource theft) and its effectiveness?
Key areas:
Use of information sharing systems; and effectiveness of customs regulations (indicators?)
Procedures for triggering audits; and use of cross-referencing invoices.
Role of national electronic customs systems and other types of IT solutions.
Application of risk-assessment modules.
Customs authorities
Minister of Industry and trade Tunisian observatory of the economy National sector Ministries
National Treasury
Financial Intelligence Units
Ministry of Commerce, Industry, and SME Promotion (Cote d' Ivoire)
3
Transparency measures in commodity trading and role of commodity trading hubs in the country.
Chapter 3: National institutional architecture to address IFFs through the financial system including asset recovery: The purpose of this section is to provide information on the role of national institutions and the effectiveness of structures to address IFFs through the financial system. Particular attention should be given to anti-money laundering regulations.
Research questions Suggested resources
Describe the structure and effectiveness of the organizational set-up for anti-money laundering supervision, regulation and enforcement?
Key areas:
Capacity (financial, technological etc), oversight, financial assistance, quality.
Sources of ML (trafficking, terrorism, tax evasion, organized crime).
Institutional intermediaries (e.g commercial banks, bureau de change, money transfer services (e.g. Western Union), mobile banking.
Role of banking (inc. foreign banks);
mandates, regulations- reporting reach, enforcement capabilities.
Regional financial and monetary system membership and impact on facilitating IFFs.
Use of GoAML (anti- money laundering) software developed by UNODC.
Describe the role and effectiveness of the Central Bank and other specialized financial regulation units (please list) in combatting IFFs.
Key areas:
Policy toolkit (interest rates, required reserves, capitalization rules, money supply management, FOREX interventions).
National risk assessment on money laundering reports
Legislation on anti-money laundering practices
Autorité tunisienne anti-corruption (INLUCC)
Ministry of Finance
Financial Regulation Authority Asset Recovery Agency Ministry of Justice Central Bank
Bourse des Valeurs Mobilières de Tunis Financial Services Industry
4
Capacity, funding, source and reliability of funding sources.
Impact of technology and innovations on regulating and tracking IFFs (mobile money).
Role of capital controls.
Links between the domestic financial system and transnational network – does the country have any neighbors considered offshore financial centers, secrecy jurisdictions or tax havens?
Describe the role of the Stolen Asset Recovery Initiative in the country? How effective is it and what other relevant asset recovery bodies are there?
Chapter 4: Special institutions to address tax avoidance and evasion by multinational corporations: The purpose of this section is to provide information on the role of national institutions to address IFFs due to abusive tax practices of multinational corporations, national corporations and individuals. Particular attention should be given to the roles of tax policy, abusive tax treaties, revenue and customs authorities and information-sharing.
Research questions Suggested resources
Please describe the nature of Foreign Direct Investment to the country. Which sectors attract the most FDI, from which countries and/or companies?
In your view, in which ways does FDI facilitate IFFs?
Key areas:
Government incentives; foreign investors’ influence; and impact of tax competition.
Management of income from natural resources.
Specialist units for dealing with Base Erosion and Profit Shifting? What are the roles and how effective are they?
Transfer pricing regulations in
preventing tax avoidance and evasion by multinational corporations?
Central Banks
La Brigade d'investigation et de lutte contre l'évasion fiscale
Customs authorities
Ministry of Trade and Investment Ministry of Finance
National Treasury
Financial Intelligence Units Bilateral tax treaties
Trade agreements and other relevant investment policies
5
Risk-assessment approaches; audit triggers.
Investment policies, Double Taxation Agreements and Bilateral Investment Treaties.
How effectively are information
exchange for tax-related purposes based on OECD, ATAF and other standards?
Chapter 5: The role of anti-corruption measures in the struggle against IFFs: The purpose of this section is to provide information on the role of anti-corruption, transparency, public accountability etc. Particular attention should be given to the roles of anti-corruption enforcement agencies; anti-corruptions measures for Government departments; private sector and in Government procurement.
Research areas Suggested resources
Please describe the role of corruption in facilitating IFFs in this country; What type of measures are put in place for effective anti- corruption systems, tangible transparency and public sector accountability?
Key areas:
Ease of transferring illicit income abroad or Money laundering by public officials.
Corruption in law enforcement agencies, the Central Bank, Financial regulatory bodies and Financial Intelligence Units.
Use of sanctions and appropriateness
Corruption prevention requirements for public servants and effectiveness. Such as asset declarations, lifestyle audits, lists of politically-exposed persons and
requirements on financial institutions.
Location (organizational), powers and engagement of separate Anti-corruption enforcement agencies (if any)?
Use of informants; CCTV, awareness campaigns for staff and/or the public, anti- corruption hotlines, whistleblower
protection laws
The Office of the Presidency La commission Amor
the National anti-corruption agency (INLUCC),
l’Instance de la bonne gouvernance et de la lutte contre la corruption
(IBOGOLUCC)
Ministers in charge of governance and the fight against corruption.
Special Parliamentary Committee Customs authorities
Anti-corruption agencies Anti-corruption legislation
The Ministry of Local Affairs and Environment
The Ministry of Justice
The High Authority for Public Procurement (HAICOP)
the High Committee for Administrative and Financial Control (HCCAF)
the National Commission for Access to Information (INAI),
6 Transparency in Government procurement such
as:
award criteria, bids, audits of bidders for links to decision-making/influential officials
How effective are the anti-corruption enforcement for the private sector:
Such as the;
Use of accounting standards
Anti-corruption requirements for accountants and lawyers
Procedures for triggering bribery investigations
The National Federation of Tunisian Cities (FNVT)
The Tunisian Institute for Democracy and Development
The Tunisian Association of Pubic Controllers (ATCP)
Inspectorates, Civil society, Media, public enterprises, Ministry of Justice, Ethics Commission, Financial Intelligence Units, Financial Regulation Authorities
Chapter 6: Overall framework – leadership, coordination and co-operation at the national and international levels: The purpose of this section is to provide information on the various practical challenges and constraints related to the institutional milieu at the national and international levels to address IFFs. Particular attention should be given to the roles of leadership, the importance of coordination, arrangements for information-sharing, mainstreaming the fight against IFFs, policymaking and mutual legal assistance.
Research areas Suggested resources
Please describe the role of the leadership in preventing IFFs; and what institutional arrangements have been established to assist this role?
Please describe the mechanisms used to coordinate the efforts of public institutions to tackle IFFs and the regulatory framework to support the exchange of information both domestically and internationally.
Key areas:
National IFFs risk assessments and national anti- IFFs action plans?
Information sharing between different branches of Government on IFFs?
Institutional constraints and weaknesses of in terms of structures, information, capacities, material aspects?
Involvement of private sector and civil society
The Office of the Presidency Ministry of Finance
Customs Authorities
Tunisian financial analysis committee
Prime Minister/Presidential Office or Unit managing IFFs in- country
Ministry of Justice National Treasury Anti-corruption Agencies Private Sector
Civil Society
7 Please describe the approach to national and international
coordination with respect to dealing with IFFs.
Key areas:
Observation of Protocols (particularly smuggling), and national criminalization of smuggling.
Implementation of United Nations Security Council Resolution 1373 regarding any aspect financing terrorism.
Implementation of recommendations under the United Nations Convention against Corruption in 2012 regarding criminalizing bribery of foreign officials and officials of public international organizations, illicit enrichment, obstruction of justice
regulation of liability of legal persons with respect to corruption
Does there exist a coordination of assistance for the prosecution of IFFs-related cases at international level or at least between the neighboring countries, and how effective is this coordination?
List of conventions, treaties or agreement the country is party to and/or has ratified.
Key areas:
UN Convention Against Corruption; UN Convention Against Transnational Organized Crime; and Convention on Mutual Administrative Assistance in tax matters).
Automatic information exchange for tax-related purposes using OECD and ATAF other standards;
and benefits to domestic institutions.
Integration of all international and regional commitments made under a comprehensive framework to address IFFs.
NEPAD goals of promoting and implementing banking and financial standards.
African Peer Review Mechanism (APRM) to assess corruption control mechanisms - has the country participated in the APRM processes?
What are your recommendations for the country and other countries to strengthen the fight against IFFs?
