Countries at the Crossroads 2006 - Armenia

(Scores are based on a scale of 0 to 7, with 0 representing weakest and 7 representing strongest performance.)

Introduction

Armenia was one of the first Soviet republics to rid itself of Communist rule after a democratic election in 1990. The small South Caucasus state's transition to democracy and a market economy had a very promising start as its new, young leaders embarked on sweeping political and economic reforms that earned them acclaim in the West. However, the process slowed considerably with the outbreak of a war with neighboring Azerbaijan over the disputed Nagorno-Karabakh region following the collapse of the Soviet Union. The fighting in Karabakh, coupled with armed conflicts elsewhere in the region, cut off Armenia's key routes of communication with the outside world. The country's gross domestic product (GDP) shrank by more than half from 1992 through 1993. The new regime, meanwhile, developed authoritarian tendencies that increased following a May 1994 ceasefire agreement with Azerbaijan that sealed Armenian victory in the bitter war.

The democratic regression manifested itself in a December 1994 government ban on a major opposition party and the closure of the newspapers it controlled. It culminated in the disputed parliamentary election of July 1995, which marked the beginning of Armenia's post-Soviet history of electoral fraud. Armenia's first president, Levon Ter-Petrosian, secured reelection in a reputedly rigged presidential ballot in September 1996 that provoked serious unrest in Yerevan. Ter-Petrosian's lack of legitimacy enabled his government rivals to force him to resign 16 months later. His successor and the current president, Robert Kocharian, cannot boast a democratic track record either. Kocharian was twice (in 1998 and 2003) declared the winner of presidential elections marred by serious fraud. His political opponents likewise refuse to recognize his legitimacy.

The Armenian authorities' systematic failure to hold free and fair elections was highlighted by a November 2005 referendum on a package of constitutional amendments put forward by Kocharian and his governing coalition. Official results, which showed a crushing "yes" vote, sharply contrasted with largely empty polling stations and reports of massive vote rigging.

The Kocharian administration's human rights record has repeatedly been described as poor by the international community. It hit a new low in 2004 with an unprecedented government crackdown on the Armenian opposition that involved mass arrests and even violence. The ruling regime tightened its grip on electronic media in 2002 by closing the country's sole television station critical of Kocharian.

The past two years have also seen an erosion of the civil liberties enjoyed by Armenians since the collapse of Communism. The Armenian law enforcement bodies have effectively been given the new roles of political policing and keeping track of and bullying opposition activists, especially in the regions outside the capital.

Accountability and Public Voice – 3.51

"Power in the Republic of Armenia belongs to the people," reads Article 2 of the nation's post-Soviet constitution, adopted in 1995. It provides for free and fair elections at all levels. However, all national elections held in Armenia since independence have been marred by some degree of ballot stuffing, vote rigging, and similar irregularities. Observers from the Organization for Security and Cooperation in Europe as well as the Council of Europe reported serious fraud during the most recent Armenian presidential and parliamentary elections, held in 2003. They concluded that the elections fell short of Western standards, giving weight to opposition claims that they were blatantly rigged.

The disputed constitutional referendum held on November 27, 2005, underscored the country's culture of electoral fraud. A monitoring team from the Council of Europe cast serious doubt on the credibility of the official results, according to which nearly two-thirds of Armenia's 2.3 million eligible voters took part in the referendum, and over 93 percent of them backed President Kocharian's constitutional changes. "The extremely low voting activity did not correspond to the high figures provided by the electoral commissions," the observers said in a statement.¹ The Armenian opposition, which boycotted the vote, put the turnout at about 16 percent.

The disputed referendum reinforced the widely held belief that Armenians cannot change their leadership through elections. The nation's sole post-Soviet regime change, in February 1998, was the result of government infighting rather than the expression of popular will. Free and fair elections have proved elusive despite frequent changes to electoral legislation that are supposed to inhibit chronic vote rigging. But the legal amendments have been rendered meaningless by the Armenian leaders' evident reluctance to let the public decide whether or not they should remain in power. Furthermore, the amendments have not weakened the regime's tight grip on the election commissions. The legally guaranteed equal campaigning opportunities exist only on paper, with state television and the private networks controlled by Kocharian routinely providing extremely biased coverage of opposition activities. Campaigning for the referendum was no exception.

The ruling regime has also relied heavily on its status and extensive financial resources, which are often used to buy votes, a phenomenon that again came to light during nationwide local elections held over the course of 2005. The local polls, boycotted by the opposition, were won mostly by wealthy candidates representing various business clans and even quasi-criminal elements loyal to the regime. The latter increasingly relies on government-connected oligarchs.

The authorities' poor human rights record deteriorated further in the spring of 2004, when the Armenian opposition launched a campaign of antigovernment protests in a bid to replicate the November 2003 Rose Revolution in neighboring Georgia. Kocharian's regime responded with an unprecedented crackdown on opposition supporters across the country. Hundreds were arrested and sentenced to up to 15 days in prison on trumped-up petty charges under the Soviet-era code of administrative offenses. Very few of them had access to lawyers or a public trial.

Police also arrested several opposition leaders in April 2004 and charged them with calling for a "violent overthrow of the government." The authorities released the leaders three months later under pressure from the Council of Europe. Around that time, two other prominent opposition figures and a human rights activist were assaulted in Yerevan. The assailants were never brought to justice. The victims described them as burly men with very short haircuts, resembling in their appearance bodyguards for government-connected oligarchs. Two dozen such men attempted to disrupt an opposition rally in Yerevan on April 5, 2004. Scores of police stood by and looked on as they smashed the cameras of photojournalists who were filming their actions. Only two of the thugs were subsequently prosecuted and given symbolic fines.

Tension came to a head on the night of April 12-13, 2004, when security forces dispersed an opposition demonstration outside Kocharian's residence, using water cannons, stun grenades, and even electric-shock equipment. They went on to ransack the Yerevan offices of the main opposition parties. Facing criticism by various domestic and international organizations, the authorities argued that heavy-handed tactics were justified because they staved off a coup d'etat.²

Armenia's democratization has also been hampered by an extremely lopsided system of governance that gives sweeping powers to the president of the republic. The constitutional amendments, approved in the referendum and adopted, gave some of those powers to the cabinet of ministers and parliament. The president, for example, will no longer be able to sack the prime minister and dissolve the National Assembly at will. His authority to appoint and dismiss virtually all judges will also be somewhat restricted. The United States, the European Union, and the Council of Europe endorsed those amendments. But the Armenian opposition dismissed them as insignificant and said the authorities should respect the existing laws in the first place.

Despite the constitutional reform, the Armenian president will remain by far the most powerful state official. In particular, he will continue to form single-handedly the State Civil Service Council that oversees the government bureaucracy. This council was set up in 2002 in accordance with a new law intended to protect civil servants against arbitrary dismissal, cleanse government agencies of incompetent officials, and create a merit-based system. The council, according to its chairman, Manvel Badalian, fired about 350 civil servants and hired more than 1,350 others on a competitive basis by November 2004.³ But critics say that the selection process, which includes an oral interview, is discretionary and open to abuse.

Armenia boasts more than 3,000 nongovernmental organizations (NGOs) registered with the Ministry of Justice. Although most of them hardly operate in practice, the figure suggests that the registration process is rather simple. The NGOs engage in a wide range of activities, including benevolence, human rights protection, women's and minority affairs, and consumer rights. The most successful usually have external sources of funding. The government rarely interferes with their activities, but the impact of NGOs on government policies and decisions has been minimal.

Local civic groups rarely dealt with political affairs until the 2004 government crackdown on the opposition, which was trying to unseat Kocharian. From April through June 2004, some groups held rallies and picketed the prosecutor general's office in Yerevan in protest of mass arrests of opposition activists and Armenia's perceived transformation into a police state.⁴ Following the campaign, some three dozen NGOs created a coalition advocating political reform. The coalition, called Partnership for Open Society, unsuccessfully lobbied for more serious changes in the Armenian constitution and electoral code throughout 2005. The government did, however, give in to pressure from local environmental protection groups in June 2005, when it decided to reroute a planned new highway that would have passed through one of Armenia's last remaining virgin forests.

The Armenian media operate in a more hostile environment than the NGOs, with the authorities continuing to maintain tight control over the state-owned Armenian Public Television and virtually all private channels, which are owned by businesspeople loyal to Kocharian and rarely air reports critical of his administration. Their reporters are believed to operate under editorial censorship. The only TV station critical of the authorities, A1+, was controversially pulled off the air in 2002. Its repeated attempts to resume broadcasting have been thwarted by the Kocharian-controlled National Commission on Television and Radio. The regulatory body likewise rejected an A1+ bid to obtain an FM radio frequency in February 2005. The Armenian newspapers (virtually all of them privately owned) are far more diverse and free, but their low circulation seriously limits their ability to inform the public.

From 2003 to 2005, virtually no libel suits were filed against the media. Nor did the authorities use a controversial clause in the Armenian criminal code that allows them to prosecute journalists for defamation of character. Still, the year 2004 saw the worst-ever government-sanctioned violence against journalists. At least four were severely beaten by special police while covering the brutal break up of an antigovernment demonstration in Yerevan. The beatings were never investigated by law enforcement authorities. "The impunity surrounding these attacks made journalists more vulnerable," the New York-based Committee to Protect Journalists said in a subsequent report.⁵ In a separate incident, a photojournalist was assaulted by several men after photographing luxury villas belonging to senior government and law enforcement officials. Although one person was sentenced to six months imprisonment for the attack in October 2004, the bodyguard of a senior police officer, who reportedly provoked the assault, was not prosecuted.

Internet users as well as writers, musicians, and other artists are not known to have faced any government restrictions. Economic problems and poor enforcement of copyright laws are far more serious obstacles to free cultural expression.

Recommendations

• The Armenian authorities should make firm and resolute efforts to curtail election fraud.
• The authorities should at last start enforcing legal provisions that make vote buying a serious crime.
• President Kocharian must end the de facto impunity enjoyed by increasingly feared oligarchs.
• Armenia needs a deeper, consensus-based reform of its flawed constitution.
• The ruling regime should lift restrictions on the electronic media, permit A1+ to resume broadcasting, investigate instances of unwarranted violence against journalists, and bring those responsible to trial.

Civil Liberties – 3.81

The constitution makes it clear that "no one may be subjected to torture and to treatment and punishment that are cruel or degrading to the individual's dignity." However, ill-treatment of detainees, the most common form of human rights violation in Armenia according to domestic and international watchdogs, remains widespread, with law enforcement officers routinely beating criminal suspects to extract confessions. The situation does not seem to have improved since the Armenian parliament's ratification in 2002 of the European Convention for the Prevention of Torture and the European Convention on Human Rights. The move led to the first-ever inspection of Armenia's prisons and detention sites by the European Committee for the Prevention of Torture (CPT). In a report made public in July 2004, the Council of Europe concluded that individuals arrested or interrogated by Armenian law enforcement bodies run a "significant risk" of torture, humiliation, and psychological pressure.⁶ The report said members of a CPT delegation who met with Armenian detainees heard "numerous and consistent allegations of physical ill-treatment.... The ill-treatment alleged consisted essentially of punches and kicks, and of striking the persons concerned with truncheons and/or other hard objects, such as chair legs, thick metal cables or gun butts."

Human Rights Watch likewise noted in its 2005 World Report that "Torture and ill-treatment in police custody remain widespread in Armenia."⁷ The illegal practice has continued unabated due to the atmosphere of impunity in which the Armenian police and other security agencies operate. No officer is known to have been prosecuted for such abuses in 2003-04. Furthermore, the Armenian government challenged the CPT's conclusion, saying that "the facts indicated in the report were not concrete."⁸

In April 2004, an opposition activist in the southern town of Artashat, Grisha Virabian, had to undergo urgent surgery after enduring a reportedly brutal interrogation at a local police station. The authorities refused to investigate his harrowing account of torture. Furthermore, Virabian himself was nearly prosecuted for resisting one of his police interrogators.

The country's human rights ombudsperson, Larisa Alaverdian, said in July 2005 that a large proportion of the citizen complaints filed with her office concern violations of due process of law. She said many Armenians believe that court rulings against them and their relatives are based on testimony extracted under duress. An annual report by the ombudsperson's office said that the local courts' bias in favor of state prosecutors is "constantly evident" and that the law enforcement agencies rarely investigate torture allegations.⁹ Law enforcement agencies are often eager to keep criminal suspects in pretrial detention, making it easier for them to extract "confessions."

The maximum legal period of pretrial detention in Armenia is one year. Detainees are less likely to be mistreated by law enforcement officials after being convicted and sentenced. Conditions in local Soviet-era prisons have reportedly improved since 2002, when Armenia's penitentiary system was transferred from police to Justice Ministry jurisdiction. But they were deemed unsatisfactory by a monitoring group comprising representatives of a dozen NGOs that conducted a yearlong inspection of prisons across the country. Their report, released in June 2005, said most Armenian prisons remain overcrowded and unsanitary and are in urgent need of repairs.¹⁰ Justice Ministry officials accepted the criticism but blamed the problem on a lack of funds.¹¹ The Council of Europe has repeatedly demanded the abolition of the code of administrative offenses, under which hundreds of opposition activists were arrested in 2004. However, Kocharian's regime continues to use the code on a vast scale whenever the opposition threatens its grip on power.

Aside from the 2004 opposition crackdown, the Armenian opposition has been generally free to hold rallies, although virtually none of its 2004 protests in Yerevan were formally permitted by the authorities. In May 2004, at the height of the opposition campaign, the Kocharian-controlled parliament passed a new law on rallies that many saw as an infringement of citizens' constitutionally guaranteed freedom of assembly. The law was amended a year later in line with recommendations of experts from the Council of Europe. In particular, a provision was scrapped that allowed police to disperse a street gathering if it posed a threat to public and state security. But another controversial clause that bans demonstrations outside the presidential palace in Yerevan was kept in force.

The state largely respects citizens' constitutional right to freedom of association, as evidenced by the existence of over 60 political parties and thousands of NGOs. Citizens are not forced to belong to any organization. Still, many civil servants and other public sector employees have been compelled to campaign for incumbent presidents and ruling parties during elections. They were similarly instructed to campaign for the passage of Kocharian's constitutional amendments in November 2005. Several trade unions unite mainly public sector workers. The bulk of the private sector workforce is not unionized due to high unemployment and weak government protection of workers' rights.

The creation in 2003 of Armenia's Office of the Human Rights Defender gave citizens an important new avenue for seeking justice. Despite having been appointed by the president, Ombudsperson Alaverdian has proven quite vocal in condemning and tackling abuses committed by various government bodies. Her relations with the government markedly deteriorated over the course of 2005. Alaverdian complained in July 2005 about a lack of legal powers, saying that her office is able to look into only a fraction of citizen petitions against courts and law enforcement bodies.

The Armenian constitution guarantees gender equality, and there are no laws discriminating against women. Nevertheless, Armenia is a conservative, male-dominated society in which few women hold senior government posts. Local women's organizations say domestic violence is not uncommon, but they have yet to determine the precise scale of the problem. Trafficking of Armenian women abroad is seen as a more serious problem. In 2003, the U.S. State Department upgraded Armenia from its so-called Tier 3 group to its Tier 2 group of states, which the United States believes are making "significant efforts" to tackle illegal cross-border transport of human beings. However, the department's latest annual report on the issue, released in June 2005, put Armenia on a Tier 2 watch list because of its "failure to show evidence of increasing efforts to combat trafficking over the past year."¹² Washington's warning to Yerevan followed an independent journalistic investigation that implicated senior Armenian law enforcement officials in prostitution rings operating in the United Arab Emirates.¹³

The constitution gives equal rights and protection to ethnic minorities (mostly Yezidi Kurds, Russians, and Assyrians), which make up less than 3 percent of the country's population. Even though the minorities rarely report instances of overt discrimination, they often complain about difficulties with receiving education in their native languages, partially due to financial constraints, including the lack of textbooks and resources for teacher training.

Armenia also has constitutional guarantees for freedom of conscience, with about 50 religious organizations reportedly operating in the country. Their members have been generally free to practice their religious beliefs. The Armenian Apostolic Church, to which over 90 percent of the population belongs, enjoys a quasi-official privileged status. One of the constitutional amendments put to referendum in November 2005 upholds that status by recognizing the ancient church's "exceptional mission" in the spiritual and cultural life of the Armenian people.

The church advocates restrictions on activities of nontraditional religious groups, notably Jehovah's Witnesses. The U.S.-based group was for years denied official registration primarily due to its strong opposition to military service, which is compulsory in Armenia. Dozens of its young male members have been imprisoned for refusing the two-year duty. Jehovah's Witnesses was finally legalized in October 2004, shortly after the entry into force of a new law on alternative civilian service. At least two dozen Jehovah's Witnesses enlisted for the new service, mostly as hospital attendants. However, most of them had deserted their civilian places of service by May 2005 on the grounds that they were overseen by military officials. Seven of them were sentenced to between two and three years in prison in October 2005 on desertion charges.¹⁴

Recommendations

• The Armenian authorities should stop tolerating ill-treatment of detainees and should investigate persistent torture reports. Law enforcement officials should be ordered explicitly to discontinue the practice.
• Persons taken to police stations for questioning should be given access to lawyers from the very moment of detention, rather than after being formally declared criminal suspects.
• The Armenian authorities should finally abolish the Soviet-era administrative code in line with Council of Europe recommendations.
• The Armenian ombudsperson should be given greater authority to investigate human rights abuses.
• Authorities should clamp down in earnest on human trafficking.

Rule of Law – 2.69

Armenia's judicial system remains under strong government influence, despite having undergone substantial structural changes since the Soviet collapse. It is mistrusted by the population, which perceives it as riddled with corruption. The current Armenian constitution introduced a three-tier structure of courts of general jurisdiction topped by the Court of Appeals. It also created a separate nine-member Constitutional Court empowered to overturn government decisions, impeach the president, and invalidate elections. On paper, these judicial bodies are protected against state interference. But they have been highly subservient in practice, rarely ruling against the government and prosecutors. This is not least because of the fact that all Armenian judges, except five members of the Constitutional Court, are appointed by the president of the republic without parliamentary confirmation.

In a study conducted in 2004, the American Bar Association's Central and East European Law Initiative (ABA/CEELI) found no fundamental progress in judicial independence and corruption in recent years. It rated Armenia negatively on 13 out of the 30 indicators making up its judicial reform index, used to assess the rule of law in emerging democracies.¹⁵ Among the factors negatively rated were the selection and appointment of judges and the courts' susceptibility to improper influence. The ABA/CEELI study, based on interviews with Armenian judicial officials and legal experts, concluded that "legal culture in Armenia, mainly in the criminal law field, is still dominated by Soviet-era thinking that puts the procuracy at the top of the legal system, followed by judges and lastly defense advocates."16

The mass imprisonment of opposition activists in 2004, when Armenian judges rubber-stamped police fabrications, was a vivid manifestation of this reality. Another indication of their subordination to the executive is the fact that the local courts sanction pretrial detentions of criminal suspects in the vast majority of cases. According to official statistics unveiled by a senior judge at the Armenian Court of Appeals, Mher Khachatrian, more than 96 percent of 5,116 arrest petitions filed by prosecutors in 2003 were approved by judges at various levels.¹⁷ Less than half of those remanded were convicted and sentenced to prison terms in subsequent trials. Khachatrian admitted that many judges "seem to be scared" of rebuffing prosecutors, who are usually guided by the Soviet-style presumption of guilt.

Some of the key constitutional amendments enacted by the Armenian authorities in 2005 are meant to strengthen the judiciary by making Armenia's Council of Justice, a body that has the exclusive authority to recommend to the president the appointment and removal of judges, more independent. Until now all the council's members were named and dismissed exclusively by the head of state. The constitutional reform empowered Armenian judges to elect nine council members by secret ballot. The president and the parliament each appoint two of the remaining four members of the body. It will take years before the practical impact of this change emerges.

It also remains to be seen whether the authorities will make any changes in the procedure for the selection of judicial candidates. The process involves oral interviews with the justice minister. The ABA/CEELI study noted a "widespread public perception that this process is guided by bribery, nepotism, and partisanship." In addition, Armenian law does not require prospective judges to have practiced before a tribunal or to undergo relevant training before taking the bench. This might explain why many judges are perceived to be incompetent.

"All persons are equal before the law," proclaims one of the constitutional amendments pushed through in the disputed referendum. It is hard to imagine this provision being enforced under Armenia's existing law enforcement and judicial systems. Armenian law may prohibit any discrimination based on a person's gender or ethnic origin, but the reality has been very different. Innocent citizens lacking money and government connections are practically unprotected against mistreatment in custody, while criminals may have cases against them dropped in exchange for a bribe.

Trials in Armenia are usually open to the media and the public in general. Criminal suspects have a legal right to hire defense attorneys. If they cannot afford to do so, the state is required to provide them with a lawyer free of charge. However, government-appointed counsels are notorious for secretly collaborating with prosecutors. The Office of the Prosecutor General is tightly controlled by the president, which is why politically motivated trials are not uncommon in Armenia. The procuracy, the police, the National Security Service (the former KGB), and the military are directly subordinate to Kocharian. Parliament and even the Cabinet of Ministers have little control over their activities.

Ruling regimes in Armenia have always used the security apparatus for carrying out and covering up vote falsifications. Law enforcement bodies have also become powerful tools of political repression in recent years, with police departments across the country detaining opposition activists whenever Kocharian's hold on power is challenged by his foes. This was evident in the run-up to and in the wake of the November 2005 referendum. Local human rights groups saw more and more elements of a police state in Armenia during 2003-05.

It is little wonder that there were virtually no reported instances of senior law enforcement officials prosecuted for abuse of power. Most of these officials, wealthy individuals with extensive business interests, operate in utter disregard for human rights. Prosecutor General Aghvan Hovsepian, for example, is believed to control a dairy firm, a TV channel, and other businesses. Another powerful official, Deputy Police Chief Hovannes Varian, was described by a newspaper as Armenia's richest policeman, who has made a "very serious fortune" fed by at least a dozen businesses.¹⁸ Not incidentally, Varian has been present at just about every major opposition rally in Yerevan and personally led the brutal break up of the April 2004 protest outside Kocharian's palace.

The constitution gives everyone the right to own private property, which the state can take away only in exceptional cases and with commensurate compensation defined by law. This provision appears to have been generally respected until the start of a massive government-sanctioned redevelopment project in central Yerevan in 2004. Hundreds of old houses were torn down to give way to expensive residential and office buildings constructed by private investors. Many of the house owners protested against the amount of financial compensation offered by the municipal authorities, saying it was well below the market value of their property. Some even sued the government, accusing officials overseeing the scheme of corruption. However, Yerevan courts sided with the government in virtually all cases, and a human rights lawyer who represented the last resisting house owners was arrested by former members of the KGB on dubious fraud charges in October 2005. Most of those low-income residents were forcibly evicted from their homes by the end of 2005.

In a special report issued in September 2005, Ombudsperson Alaverdian condemned the entire process as unfair and even illegal. She argued in particular that the properties were alienated in accordance with government directives rather than under a special law, as is required by the constitution.¹⁹ The government ignored the report.

Recommendations

• The Armenian authorities should enact additional safeguards for judicial independence, such as a parliamentary endorsement of all judicial candidates, and put an end to the justice minister's involvement in their selection.
• The government and law enforcement agencies should stop pressuring courts into handing down verdicts favorable to their interests.
• State prosecutors should scale down recourse to pretrial detentions.
• The ruling regime must stop using the police and the former KGB operatives to deal with political opponents.

Anticorruption and Transparency – 2.62

Armenia's business environment has long been regarded by Western lending institutions as one of the most liberal in the former Soviet Union. The government appears to have liberalized it further in recent years under pressure from the International Monetary Fund (IMF) and the World Bank. In an extensive study on the Armenian economy, a group of IMF economists pointed to a simplification of licensing procedures, a higher "quality of [government] regulations," and their increased accessibility to the local business community. "These changes led to an improvement in the business environment and put Armenia ahead of most CIS countries in a variety of governance indicators," they wrote.²⁰ The World Bank arrived at a similar conclusion in a September 2005 survey that assessed "the ease of doing business" in 155 countries on the basis of ten factors such as taxation, business registration, and labor legislation. Armenia was 46th in the rankings, ahead of all other CIS countries.²¹

Still, government connections remain essential for doing business in Armenia. Some forms of large-scale economic activity, such as importation of fuel, wheat, and other basic commodities, have effectively been monopolized by oligarchs. Another form of excessive state involvement in the economy is a notoriously corrupt and arbitrary tax and customs administration. The IMF and the World Bank have been pressing the authorities to tackle the problem, but harassment from tax authorities remains the number one subject of complaints by Armenian businesspeople. They usually avoid publicly challenging the government for fear of retribution.

In a very rare exception to this rule, the coffee importing company Royal Armenia publicly accused the leadership of the Armenian customs authority throughout 2004 and 2005 of illegally penalizing it for its refusal to engage in a scam that would have enriched senior customs officials. The extraordinary allegations, denied by the Armenian customs authority, were widely covered by the Armenian press. But the embattled company faced serious consequences as a result, when it was all but driven out of the coffee business and its two top executives were arrested on dubious fraud charges in October 2005. Their example will hardly encourage whistle blowing by other entrepreneurs.

Many ministers and other senior government officials are themselves involved in business, directly or indirectly owning companies. Armenian newspapers regularly carry reports about their and their relatives' extravagant lifestyles. Their questionable self-enrichment is clearly facilitated by the absence of any laws on conflicts of interest. Armenia did enact a law in 2002 that obligated senior public officials to declare their assets. However, the law has proven ineffectual, with many officials routinely underreporting their conspicuous wealth.

This reality is a reflection of the widespread corruption that has engulfed all areas of life in Armenia, including the education sector. Bribery remains a serious problem in the selection of students for the prestigious programs of state-run universities. In November 2003, the government unveiled a long-awaited plan of mainly legislative actions aimed at fighting corruption. Throughout 2005, the government claimed to be successfully implementing the program endorsed by the World Bank, but indications that it has actually reduced the scale of graft were absent. For example, Armenia scored 2.9 out of 10 on Transparency International's 2005 Corruption Perceptions Index (CPI) – down from 3.1 in the 2004 global survey conducted by the Berlin-based watchdog.²²

There is a widely held belief, shared by Transparency International representatives in Yerevan, that the Armenian authorities lack the will to combat corruption in earnest. During 2003-05, no senior officials are known to have been prosecuted for bribery and other corrupt practices. Law enforcement authorities claimed to have solved 227 corruption-related crimes in the first half of 2005 but refused to identify any of the individuals who allegedly committed those crimes.²³

Although Armenian laws and regulations are published on time and are even accessible on the Internet, government transparency has generally been lacking. In September 2003, the Armenian parliament passed a potentially significant law that gives citizens the right to obtain important information from both public and private legal entities. Under that law, government agencies cannot turn down citizen inquiries that deal with "cases of emergency threatening citizens' health and security," the economic situation in the country, education, health care, and environmental protection. Such information must be provided, normally free of charge and in writing, within 30 days of the receipt of an application. Public awareness of these important provisions has so far been weak, and it is therefore premature to gauge their overall impact on government transparency.

At least one government structure, the Yerevan municipality, has clearly failed to comply with the law by refusing to release copies of all of its decisions regarding lucrative land allocations in the Armenian capital in recent years. The information was requested by Hetq.am, an online investigative publication that extensively covered the process, which was tainted with reports of high-level corruption and nepotism. The copies had still not been provided by the municipality as of November 2005, despite successful legal action taken by Hetq.

The government's budget-making process has been reasonably transparent, with the National Assembly publicly debating and even altering spending bills submitted by the executive. The government also reports to parliament and must secure its approval for the execution of the national budget. The government's detailed execution reports must be considered by lawmakers after being examined by parliament's Audit Chamber. However, although the oversight body, the most important in Armenia, has repeatedly criticized the government's use of public finances and external loans, it lacks the legal and administrative muscle to affect government policies.

The authorities also claim to have cracked down on corrupt practices in the awarding of government contracts with a 2000 law that mandates competitive bidding for every single government purchase of goods and services worth more than $500. But the head of a government agency handling state procurements, Gagik Khachatrian, admitted in February 2005 that many potential suppliers avoid taking part in such tenders, presumably because of lack of faith in their integrity.²⁴ Much of the foreign assistance in Armenia comes from the United States and Europe, who administer its distribution themselves.

Recommendations

• The Armenian authorities should stop tolerating endemic corruption in their ranks and should enforce relevant laws by prosecuting corrupt high-level officials.
• The authorities should enact a stringent law on conflicts of interest and amend the existing law on financial disclosure to allow for the verification of declared assets.
• Tax and customs officials must be explicitly banned from collecting state revenues in an arbitrary and discretionary manner.
• The freedom of information law should be amended to specify sanctions against government agencies illegally refusing to provide data requested by citizens.

Author

Emil Danielyan is a Yerevan-based journalist and political analyst.

Notes

1 "Statement by the Council of Europe Observer Mission for the referendum on constitutional amendments in Armenia" (Strasbourg: Council of Europe [COE], 28 November 2005).

2 Cycle of Repression: Human Rights Violations in Armenia (New York: Human Rights Watch [HRW], Briefing Paper, 4 May 2005), http://hrw.org/backgrounder/eca/armenia/0504/.

3 Hrach Melkumian, "Armenian Civil Service Watchdog Sums Up Two-Year Work," in RFE/RL Armenia Report (Prague and Washington, D.C.: Radio Free Europe/Radio Liberty [RFE/RL]), 4 November 2004, http://www.armenialiberty.org.

4 Hrach Melkumian, "Civic Groups Protest Against 'Police State,'" RFE/RL Armenia Report, 15 April 2004.

5 "Armenia," in Attacks on the Press 2004 (New York: Committee to Protect Journalists [CPJ]), http://www.cpj.org/attacks04/europe04/armenia.html.

6 Report to the Armenian Government (Strasbourg: COE, European Committee for the Prevention of Torture and Inhuman or Degrading Treatment or Punishment, 28 July 2004), http://www.cpt.coe.int/documents/arm/2004-25-inf-eng.htm.

7 World Report 2005 (HRW), http://hrw.org/wr2k5/.

8 Final Response of the Armenian Government to the Report of the European Committee for the Prevention of Torture and Inhuman or Degrading Treatment or Punishment (Strasbourg: COE, European Committee for the Prevention of Torture and Inhuman or Degrading Treatment or Punishment, 28 July 2004), http://www.cpt.coe.int/documents/arm/2004-27-inf-eng.htm

9 Anna Saghabalian, "Ombudsman Criticizes 2004 Crackdown on Opposition," RFE/RL Armenia Report, 26 April 2005.

10 Karine Kalantarian, "Civic Groups Want Better Prison Conditions in Armenia," RFE/RL Armenia Report, 30 June 2005.

11 Ibid.

12 Trafficking in Persons Report 2005 (Washington, D.C.: U.S. Department of State, Office to Monitor and Combat Trafficking in Persons, 3 June 2005), http://www.state.gov/g/tip/rls/tiprpt/2005/.

13 Edik Baghdasarian, "Prosecutors are Hard at Work, But Human Trafficking is Booming," Hetq-Online (Investigative Journalists of Armenia), 30 March 2005, http://www.hetq.am/eng/society/0503-dub-9.html.

14 Vahan Ishkhanian, "Convictions for Conviction: Alternative service recruits sentenced on AWOL charges," Armenia Now, 11 November 2005, http://www.armenianow.com/?action=viewArticle&CID=1378&IID=1055&AID=1202.

15 "Armenia," in Judicial Reform Index (Chicago and Washington D.C.: American Bar Association, Central and East European Law Initiative [ABA/CEELI], December 2004), http://www.abanet.org/ceeli/publications/jri/home.html.

16 Ibid, 2.

17 Karine Kalantarian, "Arrest Data Highlight Court Weakness In Armenia," RFE/RL Armenia Report, 27 April 2004.

18 Karen Mikaelian, "Adherents of the Criminal Underworld," Chorrord Ishkhanutyun, 6 December 2005.

19 Vahan Ishkhanian, "Is Anybody Listening?" Armenia Now, 25 September 2005.

20 E. Gelbard, J. McHugh, C. Beddies, and L. Redifer, "Growth and Poverty Reduction in Armenia: Achievements and Challenges" (Washington, D.C.: International Monetary Fund [IMF], December 2005), 10.

21 Atom Markarian, "Armenia's Business Environment 'Best In CIS,'" RFE/RL Armenia Report, 21 September 2005.

22 2005 Corruption Perceptions Index (Berlin: Transparency International, 18 October 2005), http://www.transparency.org/policy_and_research/surveys_indices/cpi/2005.

23 Ruzanna Stepanian, "Government Reports Rise In 'Corruption Crimes,'" RFE/RL Armenia Report, 2 November 2005.

24 Nane Atshemian, "Official Admits Business Distrust Of State Procurements," RFE/RL Armenia Report, 16 February 2005.