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POLICY NOTE

Managing Conflict of Interest


in Afghanistan

www.integritywatch.org
POLICY NOTE
Managing Conflict of Interest in Afghanistan

Integrity Watch Afghanistan


Kabul
October 2020
Copyright © 2020 by Integrity Watch Afghanistan. All rights reserved.
Published by Integrity Watch Afghanistan
Qala-e- Fatullah, Kabul, Afghanistan
Email: info@integritywatah.org
Website: www.integritywatch.org
INTEGRITY WATCH AFGHANISTAN

About Integrity Watch


Integrity Watch is an Afghan civil society organization committed to increasing transparency,
accountability, and integrity in Afghanistan. Integrity Watch was founded in October 2005 and
registered as an independent civil society organization in 2006. The head office of Integrity Watch is in
Kabul with provincial programmatic outreach in Balkh, Herat, Kapisa and Nangarhar provinces of
Afghanistan.
Over the last decade, Integrity Watch’s work focused on: Community Monitoring, Research, and
Advocacy.
Integrity Watch focuses on citizens and community mobilization. Its noteworthy work in this area
included development of community monitoring tools, mobilizing and training communities to monitor
infrastructure projects, public services, courts, and extractives industries.
The organization’s research work focuses on policy-oriented research, measuring trends, perceptions
and experiences of corruption covering a wide range of related issues including in security and justice
sectors, extractive industries, public finance and budget management, and aid effectiveness. The
objective is to undertake new, ground-breaking empirical research that would help to set the future
agenda, influence decision-makers, bring to the public attention non-documented and un-explored
issues.
Integrity Watch has taken up a pioneering role in advocating for knowledge-based decision-making
and informed public debate on corruption and integrity issues. The advocacy work includes facilitation
of policy dialogue on issues related to integrity, transparency, and accountability. Integrity Watch’s
policy advocacy focuses on examining the accountability of the government and service providers to
the communities they serve. Access to information; budget transparency and accountability; aid
transparency and effectiveness; effective public service delivery, and anti-corruption have been
examined to date.

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Acknowledgements
Integrity Watch Afghanistan would like to thank the author of this policy note, Sayed Ziafatullah Saeedi.
We would also like to thank Sayed Ikram Afzali, Norville Conolly and Mohammad Naser Timory for
spending their precious time reviewing this paper. Dr. Andras Tamas and Dr. Illaria Vianello are also
appreciated for their invaluable feedback on this paper. Members of the Technical Working Group,
Professor Musa Enayat, Mr. Waheed Zadran, Mr. Kaous Shahi, Mr. Ezatullah Joya, Mr. Abdullah Kakar and
Mr. Imamudin Timory, and members of Conflict of Interest Panel who provided helpful insight for this
paper should not go unnoticed. GIZ OPAF should also be thanked for funding this project. Nasibullah Zeer
is also thanked for design of this note.

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INTEGRITY WATCH AFGHANISTAN

Table of Contents

Executive Summary ................................................................................................................. 7


Introduction .............................................................................................................................. 8
Key Findings and Recommendations of Gap Analysis of Afghanistan ............................... 9
Institutional Arrangement.......................................................................................................10
Centralized Model ..................................................................................................................10
Decentralized Model..............................................................................................................12
Proposed Model for Afghanistan ..........................................................................................13
National Level .........................................................................................................................13
Conflict of Interest Management in Provinces.....................................................................14
The Legal Framework .............................................................................................................15
Recommendations .................................................................................................................16

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Executive Summary

Conflict of interest has been named as a “key After that similar regulations should be brought
emerging issue” by the Organization of Economic in which govern the judiciary and the legislature.
Cooperation and Development and its The stakeholder discussions also suggested that
management and resolution is very new to many Afghanistan has three options in considering the
countries.1 development of an institutional framework
namely creating a new conflict of interest
In 2017, President Ghani asked Integrity Watch management agency, giving the responsibility
Afghanistan to undertake a research on conflict for conflict of interest management to an
of interest in Afghanistan’s regulations. The appropriate existing body, or mandating each
research was concluded in 2018 and indicated agency with the management of conflict of
that although Afghanistan has various provisions interest issues.
on conflict of interest in different laws and
regulations, it lacks a coherent and A close analysis of these three options reveals,
comprehensive conflict of interest management however, that Afghanistan cannot fully embrace
system composed of laws, regulations lacks, any of the proposed models. Instead its conflict
policies and procedures. of interest management should be placed
somewhere between a centralized and a
Following the research, a technical working decentralized structure where each agency is
group drawn from government, civil society and mandated to self-manage its conflict of interest
international stakeholder was formed to reflect issues while the Anti-Corruption Commission
on the findings of the research, weigh different oversees and coordinates the performance of
policy options and recommend one. each agency while investigating complaints and
proposing sanctions.
Discussions between members of Technical
Working Group revealed that designing a conflict The institutional framework of this system could
of interest management system which covers all be regulated with the addition of a new section
three branches of the government at once could to the Anti-Corruption Law or the creation of a
be challenging challenging and therefore an new conflict of interest regulation (moqarara).
incremental approach should be taken: The
Executive should be the first branch of
Government where the regulation of the
management of conflicts of interest should take
place.

1
OECD, Managing Conflict of Interest in Public Service (2003), 39.

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INTEGRITY WATCH AFGHANISTAN

Introduction
Afghanistan has been regularly included in the After the roundtable, a technical working group
global corruption perception index of was formed to reflect on the findings of Integrity
Transparency International as one of the most Watch’s research and to formulate the current
corrupt countries in the world.2 The National policy proposal. Members of this technical
Corruption Survey conducted in 2018 by working group were drawn from governmental
Integrity Watch Afghanistan suggests that and non-governmental stakeholders and
Afghans see corruption as one of the three major included representatives of the following
problems that the country is currently facing.3 agencies: National Procurement Authority,
Though fighting corruption has long been a Office of Ombudsperson, Independent
preoccupation for Afghanistan and different Administrative Reforms and Civil Service
tools have been used in this battle, insufficient Commission, Ministry of Justice, Supreme Audit
attention has been paid to a specific yet Office, Max Planck Foundation for International
important dimension: conflict of interest. Peace, Afghanistan Legal and Research
Conflict of interest management is of high Development Organization and Integrity Watch
importance in any anti-corruption policy as the Afghanistan.
neglect of this can pave the way for corruption.4
This paper is born out of discussions in the
To fill this gap, in 2017, President Ghani asked technical working group. Its content is drawn
Integrity Watch Afghanistan to conduct research from discussions and presentations in the
on the conflict of interest regulations in technical working group as well as comparative
Afghanistan and the gaps and flaws in them. The studies. A major source of these comparative
research was partly in response to the problems studies was the documents published by
that the National Procurement Authority was Organization for Economic Cooperation and
facing. Integrity Watch concluded the research in Development. The draft of this policy note was
November 2018 and shared its findings with shared during a roundtable with representatives
stakeholders and consulted with them. The of forty stakeholders coming from government,
conclusion of these consultations was a civil society and international organization, and
roundtable event called “A Gap Analysis of their comments were incorporated in it.
Afghanistan’s Conflict of Interest Regulations”
which was held on November 5th, 2019. The This note starts with a brief summary of the key
roundtable included a wide range of recommendations of the mentioned research, is
stakeholders including government officials, civil followed by a description of global practices
society activists, academics and students, and along with possible models for Afghanistan,
was focused on the findings and describes an appropriate institutional
recommendations of the research. arrangement for managing conflict in Afghan
State, and ends with recommendations on
conflict of interest management in Afghanistan.

2See Transparency International, Corruption Perception Index 3 Integrity Watch Afghanistan, Taking on Corruption: Institutional
(2018). Arrangement to Fight Corruption in Afghanistan (2018), 1.
4
OECD, Managing Conflict of Interest (2007), 15.

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Key Findings and Recommendations of Gap Analysis of Afghanistan’s


Conflict of Interest Regulations
The findings of the research called “Gap Analysis A key part of Gap Analysis of Afghanistan’s
of Afghanistan’s Conflict of Interest Regulations” Conflict of Interest Regulations is the
has served as a guide for the technical working consideration of Afghan contexts and factors
group and this paper. A brief summary of its that affect conflict of interest in this context. The
recommendations appears here. research pinpoints three factors, amongst other,
as major Afghan contextual factors: collectivist
The paper suggests that for any effective social structure, the focus on public sector as
approach to curb conflict of interest, having a major source of income, and dark web of
well-rounded management system that patronage.8
“includes laws, policies, regulations, and
procedures” which has functions such as The first contributing factor, collectivist social
“investigation, enforcement, education, structure, suggests that because Afghanistan is a
provision of advisory services and more” and is collectivist society, “actors are expected to
“adequately-funded [within] independent distribute resources to which they have access to
institutional framework” is crucial.5 In the members of their kin and affinity groups” and to
Afghan case, the findings of research indicates curb this factor, “well-crafted incentives and
that “few of these elements appear to be in educational processes” are recommended. 9
place” and “the government requires significant
policy and institutional development work to The focus on public sector as a major source of
establish an effective and contextually income is explained as another contributing
appropriate system to properly manage conflict factor by this research. Influential individuals
of interest in the country.” 6 have no choice but to distribute this source of
income to their kin and affinity group members,
To overcome this flaw, the paper recommends as described above. 10
developing and implementing a national conflict
of interest law and policy “with institutions The final contributing factor is dark web of
required to operate a contextually appropriate patronage in appointments. The research
management system.”7 indicates that senior officials do whatever it
takes to appoint their favorite person and will
possibly pose a threat to introduction of any
conflict of interest management system. 11

5 Integrity Watch Afghanistan, Gap Analysis of Afghanistan’s 8 Ibid, 32


Conflict of Interest Regulations (2018), 28. 9 Ibid
6 Ibid. 10 Ibid
7 11
Ibid, 28 Ibid

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INTEGRITY WATCH AFGHANISTAN

Institutional Arrangements
The design of a conflict of interest management based on article 30 and 38 of ACPOI.
system is interconnected with the “legal,
Figure 1: The Croatian model of conflict of
political and administrative context of a
interest management
country.”12 i.e. while formulating any approach
to conflict of interest, the designers have to have 1. Registering officials
assets
sufficient knowledge of a country’s 2. Initiating
investigations on officials
assets
administration, laws and level of political will. Act on the Prevention
of Conflict of Interest
Conflict of Interest
Commission 3. Establishing COI
[APCOI] \ 4. Providing counseling
Considering this and the current Afghan legal on COI
5. Sanctioning violators
and administrative setting, there are two
structural options for conflict of interest
management in Afghanistan: centralized and If Afghanistan is to opt for this model, there are
decentralized models. two possibilities.

• One is to create such an entity, preferably in


Centralized Model the shape of a Commission that will manage
In a centralized model, the responsibility of COI in all executive agencies, or even in all
three branches of the government. Like
managing conflict of interest is entrusted to one
Croatia, this entity would enjoy all conflict of
agency that will specifically deal with controlling
interest-related powers.
conflicts of interest. Croatia is one good
example: Article 2 of Act on the Conflict of • The other possibility is creating such a
Interest (ACPOI) bestows the responsibility of directorate within one of the related existing
managing conflict of interest to a Conflict of agencies. Some possible existing institutions
Interest Commission. It should be noted, where such an arrangement could fit are the
Independent Administrative Reform and
however, that the Commission only manages
Civil Services Commission (IARCSC), the
conflicts of interest of senior officials.
National Procurement Authority (NPA), the
Article 8 of ACPOI states, that upon the Office of Ombudsperson, the Anti-
appointment or election of an official, the Corruption Commission or the Supreme
electing bodies can ask the Commission for Audit Office.
details of the candidate’s previous performance In both cases, the institution would then have all
and any ACPOI related infringement by the the conflict of interest related powers, namely
candidate. Article 10 of ACPOI mandates the oversight, coordination, regulation, education,
officials to submit a report on the offices where declaration, detection, investigation, and
they worked previously as well as their assets. sanction.
The officials do not receive their salary until they
Figure 2: Centralized Model’s Functions
submit this report. The Commission also has the
powers to initiate an investigation on assets of
public officials, establishing and managing Conflict of Interest Commission

conflicts of interest, and sanctioning the official


in case of failure to disclose a conflict of interest, Oversight Regulation Education Declartion Detection Resolution Sanction

12
OECD, Managing Conflict of Interest in Public Sector (2003), 28.

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INTEGRITY WATCH AFGHANISTAN

Several questions arise in regard to both of the • The National Procurement Authority is not a
possible models described above. With regards viable option either. It only deals with
to option 1 ie a new agency specifically dealing procurement. Admittedly a major part of
with conflict of interest, the following questions conflicts of interest appear within
arise: procurement, yet it is not its only
appearance. As mentioned, conflict of
• According to the Afghanistan Analysts interest has a varied nature and an agency
Network (AAN), currently ten separate anti- only dealing with procurement is less likely
corruption bodies are in operation in to manage it in recruitment and other areas.
Afghanistan.13 AAN’s report along with the
• Though the legal powers of the
report of UNAMA suggests that such an
Administrative Reform and Civil Services
amassed architecture, “presents a
Commission has the potential to embrace
significant challenge to coordination
such an arrangement, the same question
efforts”.14 In its report, AAN has concluded
could be raised about it: its scope of
that these anti-corruption institutions are
operation is recruitment and therefore
“too many, and with too few results”.15
would it be possible for it to manage conflict
Bearing this in mind, the creation of another of interest in procurement and other parts?
body which deals with conflicts of interest
• The Supreme Audit Office’s law does not
will further add complexity to the current
allow for such an arrangement. Article 4 and
architecture while carrying the risk of
5 of the law clearly defines the scope of the
bearing no significant fruit.
office’s operation: financial and accounting
• Another major challenge would arise from affairs. Thus, the office could not be charged
the varied nature of conflicts of interest: the with managing conflicts of interest as it goes
way it could be defined and managed in much beyond financial and accounting
recruitment is very different from matters.
procurement. If one institution is to manage
• The only appropriate option is the
them all, it has to deal in many different
forthcoming Anti-Corruption Commission.
fields, and thus the possibility of having an
However, charging this commission with
amassed bureaucracy is high.
such a big responsibility may pose the risk of
Creating a conflict of interest management overloading the new commission with a task
directorate under the umbrella of any of the which is broad in scope and complex in
mentioned agencies could be equally challenging nature.
for several reasons. For the abovementioned reasons, the creation of
• Such a directorate could not be created a new conflict of interest management agency
under the Office of Ombudsperson as the and charging it with all conflict of interest
office only deals with higher appointments functions does not appear to be a viable option
which are above grades, and thus leaves for Afghanistan.
grade one-six appointments out.

13Afghanistan Analysts’ Network, Afghanistan’s Anti-Corruption 14UNAMA, Afghanistan’s Fight Against Corruption (2017), 11.
Institutions: Too many and with too few results, (20 May 2019) 15Afghanistan Analysts’ Network, Network, Afghanistan’s Anti-
https://www.afghanistan-analysts.org/afghanistan-anti- Corruption Institutions: Too many and with too few results (20
corruption-institutions-too-many-and-with-too-few-results/. May 2019).

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INTEGRITY WATCH AFGHANISTAN

Decentralized Model
In the decentralized model, Australia and New In both countries, the basis for managing
Zealand being two Federal examples, the conflicts of interest has been laid down through
management of conflict of interest is granted to Acts, and its management is given to the head of
each agency’s head while a central conflict of agencies or “employers”. In New Zealand, the
interest authority either only has counseling State Services Commission provides “general
function or does not exist at all. In case of advices to chief executives, board members and
Australia for instance, the Public Service employees.”17 In Australia, it is part of the
Commission provides guidance on the broader responsibility of agency heads to ensure
application of Australian Public Services Code of that “their employees understand and abide by
Conduct- which includes conflict of interest- and their obligations in terms of ethical behavior,
prepares annual reports on the performance of including the disclosure and management of
agencies in its management. In another example, conflicts of interest.” 18
New Zealand, 2950 organizations out of 3000
In other words, in both models, the only function
state sector organizations are responsible for
given to the central authority is counseling and
“designing and implementing their own specific
guidance. Education, detection, resolution and
conflict of interest policies”.16 sanction are the powers of each agency’s head,
The head of each of these agencies is responsible and it is up to their discretion how they ensure
for such an arrangement and can provide it.
guidance to ensure management of conflicts of Such a model does not have the potential to be
interest. applied to Afghanistan because Afghanistan is
not a federal state. Also, charging each agency
wit self-regulation of conflict of interest without
a proper oversight mechanism may even
contribute to corruption.

16OECD, Managing Conflict of Interest in the Public Sector (2003), 17 Ibid, 189.
18
52. Ibid, 103.

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INTEGRITY WATCH AFGHANISTAN

Proposed Model for


Afghanistan
The proposed model for Afghanistan is It should be noted, however, that sufficient
somewhere in between the two above described guidance should be provided through the
models. Its suitability for Afghanistan is largely provisions of regulations to the agencies to help
drawn from the deficiencies of a centralized them with the creation of an effective
model- chiefly the vast institutional management system. One possible model
rearrangements it brings about. The proposed recommended for larger agencies is the
model will be described on two levels: national management of conflicts of interest in
and provincial. procurement, recruitment and finance by the
Directorate of Procurement, the Directorate of
National Level Human Resources and Internal Audit
respectively.
In the proposed model for regulating the
Executive at national level, there is a dual level In recruitment In procurement In other areas
management system: inside each agency, and
Anti-Corruption Commission. Procurement
Human Resources Internal Audit
Office
Designing the structure inside each agency Education Education Education

should be left to the discretion of that agency, Prevention Prevention Prevention

but each agency should be mandated to have a Detection Detection Detection


Resolution Resolution Resolution
conflict of interest management body. Agencies
can create a new conflict of interest
management body or charge one of its currently proposes sanctions to the head of agencies
existing bodies with such duties. This flexibility in
structural arrangements is recommended due to Figure 3: one possible model for large agencies
the differences in size of each agency.
The agency-based body should be also charged
These agency-based bodies would have the with the responsibility for registering complaints
following responsibilities: educating employees regarding conflicts of interest and channel it to
about conflict of interest, preventing from the Commission. This body should also report on
happening conflict of interest, detecting conflict its conflicts of interest performance to the
of interest, resolving conflict of interest cases Commission. Such a body will help with
and proposing sanctions for failure to disclose proposing amendments to the conflict of
conflict of interest. interest regulations.

The second layer of the proposed institutional


arrangement is Anti-Corruption Commission.
This Commission should have the regulation,
oversight, investigation and sanction authorities.

13 Policy Note
INTEGRITY WATCH AFGHANISTAN

The Commission should have the right to •Notifies the administration where conflict of
Employee
regulate conflict of interest related matters and interest occurs

oversee each agency’s performance. It should


•Educates employees
also have the power to receive complaints on •Prevents conflict of interest
conflict of interest, investigate them and COI Agency- •Detects conflicts of interest
Based Body •Manages conflicts of interest
propose sanctions.
•Registers complaints on conflicts of interest

Once a complaint is taken to the Commission, it


•Reviews complaints
should check if the case is merely an Anti-Corruption •Proposes sanctions to the head of agency
administrative violation or a mix of Commission •Coordinates conflict of interest management
•Provides guidance and counseling
administrative violation or a potential crime. If
the case is a mere administrative violation, then
Commission could propose one of the Figure 4: the breakdown of responsibilities of
disciplinary actions in accordance with the Labor each body
Law and Civil Servants Law, ask for cancellation
of the process, or if it is an actual conflict of Conflict of Interest Management in
interest, report the case to the Attorney Provinces
General’s Office. Another possibility is to have a The proposed system for the Provinces is
case which there is a mix of administrative basically an extension of the national model:
violation and a potential crime, which should be Marja Itla Giri Vilayati Shikayat (Persian, the
reported to the Attorney General Office. Provincial Body for Receiving Complaints) which
is created by the Whistleblower Protection Law
I.e. three different types of sanctions could be
would have the responsibility for registering
applied: disciplinary measures already defined in
conflict of interest complaints. Once these
Labor Law and Civil Servants Law, cancellation of
bodies receive complaints, they would channel
the affected decision, action or process, and
the complaints to Anti-Corruption Commission.
criminal prosecution. The criminal prosecution
for conflicts of interest could be done under Under the same law, Maja Ital Giri Vialyati Wahid
abuse of power legislation until the Penal Code Hay Dowomi (The Provincial Body for Receiving
is amended and it is criminalized. It is important Complaints of Secondary Units) will serve as
to note that while the case is being investigated conflict of interest agency-based bodies in the
by the Commission, the Commission should be provinces and shoulder the same responsibilities
given the right to request that the process is that these agencies do in the center of the
stopped until the alleged conflict of interest is country.
properly investigated.

A power similar to Article 35 of the Access to


Information Law which reads “agencies should
apply the sanction in accordance to law and
report its application to the Commission” should
be given to Anti-Corruption Commission.

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INTEGRITY WATCH AFGHANISTAN

This arrangement is proposed for the short term, With regard to a legal framework, two options
however. Since the concept of conflict of interest were discussed in the Technical Working Group:
is very new to Afghanistan, particularly in the creating regulations (moqarara) or creating a
Provinces, few complaints of conflict of interest new law. The initial proposal was to regulate
will be made. The current administrative conflict of interest through a moqarara chiefly
arrangements in Afghanistan both in because its creation and amendment is simpler.
recruitment and procurement also encourages But in the consultation that was held through the
few conflicts of interest cases in the Provinces: roundtable, some of the participants advocated
Governors have only the right of appointment amendment of the Anti-Corruption Law by the
for grade five and six posts and have very little addition to it of a new section on conflict of
procurement authority. interest. This suggestion was made to avoid
making the the anti-corruption architecture and
In the long-term, when the management of to integrate all anti-corruption legal documents
conflicts of interest is properly introduced to into a single law. This paper does not make any
Afghanistan, it is recommended that this recommendation in respect of these two options
proposed arrangement for the Provinces be and instead leaves it to the discretion of the
reconsidered drafting commission for decision.

The Legal Framework Whatever option the commission adopts, it is


imperative that further clarification and
As mentioned before, while having a legal instructions for conflict of interest management
foundation is imperative for the management of should be provided through guidelines that
conflicts of interest, in Afghanistan, there is clearly reflect the six steps that were previously
presently no specific legislation which deals with described. A legal instruction should also
conflicts of interest. However, various provisions mandate each agency to develop checklists
on conflict of interest exist in different laws and which provide a thorough description of conflict
regulations, ranging from Administrative of interest circumstances to help its employees
Procedures to the Procurement Law to the Code in understanding this issue and thereby prevent
of Civil Servants Law. Therefore, there are some such situations.
basic legal rules for conflict of interest
management already existing but these fall far .
short of international standards.

15 Policy Note
INTEGRITY WATCH AFGHANISTAN

Recommendations
1. The management of conflicts of interest 8. All agency-based conflicts of interest
could be regulated through addition of a bodies should be properly staffed and
new chapter in Anti-Corruption Law or financed.
creation of a conflict of interest
regulation. 9. Head of agencies, similar to Access to
Information Law, should implement the
2. The legal document should clearly define sanctions in and report on its actions to
the following six steps: how to prevent the Commission.
conflict of interest, circumstances of
conflict of interest (identification), 10. Marja Itla Giri Vilayati Shikayat (Persian,
notification and detection procedures, the Provincial Body for Receiving
options to manage it (resolution) and Complaints) should register complaints
possible sanctions. on conflicts of interest and report them
to the Commission in accordance with
3. Public servants should be properly the law.
educated about conflict of interest
circumstances, and the regulation should 11. The Anti-Corruption Commission should
oblige them to notify the administration include raising awareness on conflict of
if and when it occurs. interest issues as part of its mission.

4. The institutional arrangement for 12. In the long run, all administrative laws
management of conflict of interest and regulations should reflect conflict of
should be dual layer: Anti-Corruption interest rules to make these clear for all
Commission and agency-based bodies. employees.

5. Each agency should create a new conflict 13. Actual conflict of interest could be
of interest body or give the responsibility criminalized under abuse of power
for its management to an existing one. It legislation. In the long run, however,
should be left to the discretion of each conflict of interest should be criminalized
agency how to design the conflict of when Penal Code is amended.
interest management architecture. 14. Regulation of conflict of interest
6. In addition to managing conflicts of management in Judiciary and Legislative
interest (education, detection, should start once regulation of the
resolution and sanction) in their Executive is finished.
respective agencies, these internal
agency bodies should also register
complaints on conflicts of interest and
report them to the Commission.

7.

Managing Conflict of Interest in Afghanistan 16


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