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We are excited to share the latest edition of the Law Update, beautifully and appropriately titled “Sustainable Horizons: The Saudi Arabian Vision.” Giving special honor to the Kingdom’s 2030 vision, this update focuses on a collection of both informative and inspiring articles.
For those in construction, you can learn about how the tendering environment impacts risk-pricing for contractors, the updates on the legal framework of the construction industry and how contractors can protect themselves against financial difficulties.
There is good news too from the kingdom’s banking sector, from which the practice of “Open Banking” is being pushed for! But what is open banking? We’re answering that too.
Also . . . Are there any women trail blazers in Saudi Arabia you can name? We’ll help you with that. We cover how the Middle East has been making strides in empowering women in the entrepreneurial space,most notably in STEM fields.Read the full edition
June – July 2015
During the Abu Dhabi Executive Council meeting held on 7 May 2015, His Highness Sheikh Mohammed bin Zayed Al Nahyan, Crown Prince of Abu Dhabi and Deputy Supreme Commander of the UAE Armed Forces, gave a directive establishing a new anti-corruption unit to focus on combatting corruption, reflecting the UAE government’s commitment to corporate governance, transparency and accountability and taking the UAE a step closer to a new anti-corruption law.
Corruption and its impact
Corruption may be defined as “the abuse of entrusted power for private gain” (Transparency International (www.transparency.org)), which includes private sector corruption as well as corruption by public officials.
It is well-known that the recent economic growth of the UAE is largely based on a business-friendly environment that attracts substantial foreign investment. Although corruption is not a widespread phenomenon in the UAE, it is unrealistic to think that this influx of funds and investors will not bring with it an element of dishonest and corrupt practices, which are found in every society to varying degrees.
Corruption costs a society in a number of ways, including: financially, diminishing public trust, unwillingness by citizens to participate in society, and unfair competition. These effects of corruption contribute to the creation of an unattractive prospect for the honest majority of foreign investors.
The UAE, and in particular the emirate of Dubai, has adopted a project called the “Smart Government Plan”, which would transform all the governmental authorities’ services into e-services. In addition to the benefits in service that this system brings, it should also help to diminish the possibility of petty corruption.
There have been several other initiatives and efforts undertaken by the UAE government, which have been aimed at containing corruption, such as:
However, the UAE still faces challenges in combating corruption, which include:
The decision to establish a specialised department in the UAE to combat corruption is considered one of the main cornerstones that would assist in the continuing development of the country, limiting the chances of corrupt individuals to hinder such growth.
The new anti-corruption unit will be established within the Abu Dhabi Accountability Authority (“ADAA”). The ADAA was established by virtue of Abu Dhabi Law no. 14 of 2008, with its primary objectives being to:
This development is in line with the UAE’s commitment under the 2005 United Nations Convention Against Corruption, which states at Article 6 that:
“Each State Party shall, in accordance with the fundamental principles of its legal system, ensure the existence of a body or bodies, as appropriate that prevent corruption.”
Furthermore, the function of the new unit also reflects adherence by the UAE to the first official Arab anti-corruption instrument, the Arab Convention to Fight Corruption (“Arab Convention”), which was signed on 21 December 2010 by 21 Arab countries, including the UAE. The preamble of the Arab Convention affirms that combatting corruption is a must, and that it is not limited to the official authorities – people and civil society have a crucial role to play. Article 10 of the Arab Convention stipulates that:
“Each State Party shall, in accordance with its laws, lay down, implement and consolidate effective and coordinated policies to prevent and fight corruption. This shall include the strengthening of community participation and the application of the principles of the rule of law, good administration of public affairs and property, integrity, transparency and accountability.”
It is clear that the UAE is heading in the right direction when it comes to dealing with corruption. Transparency International’s Corruption Perception Index saw the UAE increase its score from 68 in 2012, to 69 in 2013 and to 70 in 2014. This puts the UAE at 25 out of 175 countries, making it the country with the lowest corruption perception index in the GCC.
The UAE has taken a step closer to fulfilling its commitments to tackle corruption by the announcement of the new anti-corruption unit. We await further developments in this area with interest, to discover whether a new anti-corruption law and other initiatives see the UAE rise further in the ranks of countries where the government is committed to reducing corruption.
Also read: The Effects of Corruption on Economic Development
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