- Risk key
- MODERATELY LOW
- MODERATELY HIGH
Companies contend with a low risk of corruption when dealing with the judiciary (HRR 2016, GRECO 2014). Businesses report sufficient confidence in the independence of the judiciary and are moderately satisfied with the efficiency of the legal framework for challenging regulations and resolving disputes (GCR 2017-2018). However, in a survey among judges, nearly a third believe that, over the past two years, judges had been appointed on grounds other than merit (ENCJ 2017). One in seven judges indicated that the actions of some judges are sometimes partially motivated by external influences, while an additional one in three judges was unsure about the prevalence of the practice (ENCJ 2017). A fourth of judges indicate that a high workload is influencing their ability to act independently (ENCJ 2017). A growing backlog of cases and shortages of judges can cause significant delays in the courts (ICS 2017). This lack of resources is identified as a hurdle to the effective implementation of anti-corruption legislation, leading to the dismissal of investigations, indefinite postponing of cases, and the expiry of the statute of limitations for certain transnational bribery cases (PVB 2014; ICS 2017). No citizens report paying a bribe when interacting with the courts in Belgium, despite a quarter perceiving corruption as being widespread (European Commission, Feb. 2014).
A local judge from the city of Oostende has been charged with passive bribery, forgery, money laundering, abuse of function among other charges (HLN, Apr. 2017). The judge’s trial date has been set for 2018 (HLN, Apr. 2017).
Belgium is a member of the International Center for the Settlement of Investment Disputes (ICSID), and contracts regularly contain an ICSID arbitration clause. Belgium is a signatory to the New York Arbitration Convention 1958. Local courts recognize and enforce foreign arbitral awards; judgments from foreign jurisdictions are also recognized and enforceable in local Belgium courts (ICS 2017).
Businesses consider the Belgian police to be very reliable, indicating a very small risk of corruption within the police service (GCR 2017-2018). No citizens report having paid a bribe to a police official, despite over one-third perceiving corruption and bribery as being widespread among the police force (European Commission, Feb. 2014). There is a strict civil control of the police at local and federal levels, and the government has enacted the necessary mechanisms for corruption investigations and enforcement (HRR 2016). A shortage of resources in the police service has impeded the effective investigation into financial and economic crimes (GRECO 2014).
In 2016, a number of police officers were arrested in the city of Antwerp over allegations that they had extorted and stolen from refugees (DeMorgen, Mar. 2016). It has been reported that one of the main internal inspectors at the police had become aware of the allegations up to a year before they were made public, but he failed to act (Apache, Jul. 2017). Similar allegations have also surfaced in Brussels (Bruzz, Aug. 2017). An investigation will be opened into the Brussels allegations (Bruzz, Aug. 2017).
There is a low risk of encountering corruption in Belgium’s public services sector. No citizens report paying a bribe to officials issuing licenses, even though more than one-third perceive corruption as being common among officials and inspectors (European Commission, Feb. 2014). Businesses are satisfied with the transparency of government policymaking (GCR 2017-2018). The country’s administration is predictable and reliable, despite complaints concerning cumbersome procedures and unnecessary red tape (ICS 2017). Businesses rank inefficient government bureaucracy as a problematic factor for doing business in Belgium (GCR 2017-2018). Nepotism and favoritism are sometimes found within public service companies (inter-communales), as reflected in the lax and opaque system of appointments (ReBel 2015). Criteria other than merit or qualifications may motivate appointments in the public administration (GRECO 2014). Corruption cases do occasionally come to light at the level of local government; particularly in areas where the same political party has been dominant for an extended period of time (ECACR 2014). A string of allegations against several local politicians, including the mayor of Brussels, have recently been uncovered; the politicians all got paid for taking part in meetings for which there is no actual evidence that they took place, at various private and (semi-)public companies (New York Times, Jun. 2017).
Starting a business in Belgium takes only three steps and four days, which is only half of the time required compared to the average of OECD high-income countries (DB 2017).
There is a low risk of corruption in Belgium’s land administration. Thanks to Belgium’s well-functioning court system, property rights are generally safeguarded (ICS 2017). Companies report property rights are well-protected (GCR 2017-2018). Almost half of citizens believe bribery and corruption are widespread among officials in the land administration (European Commission, Feb. 2014). Expropriation is possible under Belgian law; when the government uses its eminent domain, adequate compensation is paid (ICS 2017). The only expropriations in the past decade were related to infrastructure projects (ICS 2017). However, the real estate, land, and construction industries have been identified as areas where corruption (more specifically, money laundering) crimes are most likely to occur (RICS, Feb. 2014).
Registering property is relatively cumbersome, compared to other high-income OECD countries; it takes eight steps, double the average number, and more than twice the amount of time (DB 2017).
The Belgium tax administration does not represent a corruption risk for companies, although companies rank tax rates and regulations among the most problematic factors to doing business in Belgium (GCR 2017-2018). Bribes or irregular payments in the process of tax payments are very rare (GCR 2015-2016). The complicated tax regime is an impediment to foreign investors (ICS 2017). The number of yearly payments and the time required to pay taxes are in line with the average of the OECD high-income countries (DB 2017).
There are allegations that the Belgian tax agency has been too lenient in a voluntary disclosure scheme which it ran between 2004 and 2015 in which undeclared funds could be reported (FD, Oct. 2016). Allegedly, over 36 billion euros in undeclared funds were left severely undertaxed (FD, Oct. 2016). In addition, Swiss banking giant UBS is under investigation in Belgium for allegedly facilitating tax evasion for wealthy clients (NASDAQ, Mar. 2016). The was no further information on the case at the time of review.
There is a low risk of corruption in Belgium’s customs administration. Bribes and irregular payments when dealing with customs in Belgium are rare (GETR 2016). Nonetheless, more than one-third of citizens believe bribery and corruption are widespread among customs officials (European Commission, Feb. 2014). Companies are generally satisfied with the efficiency and time predictability of the clearance process (GETR 2016). The costs and time required to import and export in Belgium are negligible compared to the OECD high-income average (DB 2017).
There is a moderate to high risk of corruption in Belgium’s public procurement sector. Recent court cases in Belgium suggest that public procurement is the sector most affected by corruption (ICS 2017). Bribes and irregular payments occasionally occur in the process of awarding public contracts and licenses (GCR 2015-2016). Officials awarding public tenders are perceived to be among the civil servants most involved in illegal financing and bribery (GRECO 2014). In some procurement agencies, an estimated third of public officials engage in corrupt practices including bribery and abuse of office (HLN, Feb. 2016). Some identified corruption risks arise from the lack of transparency in the procurement process (ReBel 2015). Businesses perceive diversion of public funds and favoritism in decisions of government officials as rare (GCR 2017-2018). An estimated EUR 4 billion, representing twenty percent of all public procurement, is lost to corruption in public procurement contracts in Belgium every year (HLN, Feb. 2016).
Belgium has a comprehensive anti-corruption legal framework in place and the government adequately enforces the relevant laws. The Belgian Criminal Code criminalizes public and private bribery, passive and active bribery, and bribery of national and foreign public officials. Belgian courts have wide jurisdiction in corruption cases, including offenses committed in Belgium or abroad, and by Belgian citizens or foreigners (CMS 2016). However, Belgium has been criticized for its lagging efforts in the prosecution of foreign bribery (ICS 2017). Facilitation payments are not permitted in Belgium. Gifts and hospitality of any value may be illegal depending on the intent behind the action (Baker McKenzie 2017). Regulations governing gifts and other benefits, particularly in parliament and the judiciary, are vaguely defined not effectively enforced (GRECO 2014). GRECO noted in 2017 that Belgium has not made any significant efforts to implement its recommendations on clearer rules for gift giving made in 2014 (GRECO 2017). Public sector corruption offenses are penalized by imprisonment of between 6 months and 10 years and/or a fine ranging between EUR 600 and 600,000 (Lexology, Aug. 2016). The Pot-Pourii II amendment multiplies the fines between 3 and 5 times in case the bribe involves a foreign public official (Osborne Clark, Feb. 2017). Corruption offenses in the private sector are penalized by imprisonment ranging between 6 months and 3 years and/or a fine between EUR 600 and 300,000 (Lexology, Aug. 2016). The penalties for both public and private bribery may include further sanctions, such as debarment, asset forfeiture, and denial of any fiscal benefits the entity may have enjoyed (Lexology, Aug. 2016). The government has established a system of declarations of donations, assets, official appointments and other positions held, as well as codes of conducts, and a Federal Ethics Committee (GRECO 2014). There is no specific legislation addressing whistleblowing in Belgium, however, whistleblowers can seek protection under other statutes (Simmons & Simmons elexica, April 2015).
Freedoms of speech and the press are protected by the Constitution, and the Belgian government respects these rights (HRR 2016). The only practical limits to freedom of speech apply to inciting hatred, holocaust denial, and other similar actions (HRR 2016). The media is largely free and independent, but interdependent connections between politicians and journalists exist, and commercial pressure is exercised (NISA 2012). The government does not censor content online (HRR 2016). Belgium’s media environment is classified as ‘free’ (FotP 2016).
The government respects the rights of assembly and association (HRR 2016).
- World Bank: Doing Business 2017.
- World Economic Forum: Global Competitiveness Report 2017-2018.
- US Department of State: Investment Climate Statement 2017.
- European Network of Councils for the Judiciary: Independence, Accountability and Quality of the Judiciary, Performance Indicators 2017.
- GRECO: Fourth Evaluation Round Belgium 2017.
- Baker McKenzie: Anti-Corruption Belgium 2017.
- Bruzz: “Onderzoek naar Mogelijke Afpersing van Migranten door Politie”, 3 August 2017 (in Dutch).
- Apache: “Agent Signaleerde Al Jaar Eerder dat ‘Bende van Mega Toby & Sproetje’ Illegalen Afperste”, 13 July 2017 (in Dutch).
- New York Times: “Scandal Drove Brussel’s Mayor From Office. Now He’s Nowhere To Be Seen”, 13 June 2017.
- HLN: “Vrederechter die jarenlang Bejaarden Bestal in 2018 voor Strafrechter”, 20 April 2017 (in Dutch).
- Osborne Clarke: “Belgian Anti-Bribery Laws Strengthened”, 15 February 2017.
- Freedom House: Freedom of the Press 2016.
- World Economic Forum: Global Enabling Trade Report 2016.
- US Department of State: Human Rights Report 2016.
- CMS: Guide to Anti-Bribery and Corruption Laws 2016.
- FD: “Grootste Fraudeklacht in België ooit: EUR 36 mrd Witgewassen”, 26 October 2016 (in Dutch).
- Lexology: “Anti-Bribery and Corruption Guide: Belgium”, 1 August 2016.
- DeMorgen: “Diefstal en Afpersing door Antwerpse Politie: Één Agent Vrij onder Voorwaarden”, 17 March 2016 (in Dutch).
- NASDAQ: “UBS Group Charged With ‘Organized Tax Fraud’ in Belgium”, 1 March 2016.
- HLN: “Corruptie Openbare Werken: Jaarlijks 4 Milliard Euro”, 5 February 2016 (in Dutch).
- World Economic Forum: Global Competitiveness Report 2015-2016.
- Re-Bel Initiative: Corruption in Today’s Belgium 2015.
- Simmons & Simmons elexica: Whistleblowing in Belgium, 30 April 2015.
- GRECO: Fourth Evaluation Round Belgium 2014.
- World Economic Forum: Global Enabling Trade Report 2014.
- European Commission: EU Anti-Corruption Report – Belgium 2014.
- Populi Vox Belgica: Het Manifest, 18 April 2014 (in Dutch).
- RICS: ‘Tackling Corruption in the Real Estate Sector’, 6 February 2014.
- European Commission: Eurobarometer Special Surveys 2014.
- Transparency International: National Integrity System Assessments – Belgium 2012.