Conflict of interest: essence and importance of proper resolution

Failure to comply with legislation on the prevention and resolution of conflicts of interest is one of the most common factors leading to corruption offences. Timely detection and proper resolution of conflicts of interest are key elements of an effective anti-corruption policy.

To develop a clear understanding of the importance of this issue, it is necessary to define the essence of the concept itself. The Law of Ukraine “On Prevention of Corruption” does not contain a general definition of conflict of interest, but establishes two forms of it: potential and actual conflict of interest.

A potential conflict of interest arises when a person has a private interest that may affect the objectivity or impartiality of decision-making or actions taken in the performance of official duties. An actual conflict of interest exists when a private interest already influences or objectively conflicts with a person’s official powers, affecting their decision-making or actions.

It should be emphasized that a conflict of interest is not corruption in itself, but it creates an environment in which abuse of power or official position becomes possible. Thus, preventing conflicts of interest is a preventive measure against the manifestations of corruption.

For a real conflict of interest to exist, the following conditions should be met simultaneously:
● the existence of a private interest of the person;
● the existence of official or representative powers of the person;
● a conflict between private interests and the fulfillment of official duties.

The absence of at least one of these elements excludes the existence of a conflict of interest.

It should also be emphasized that a conflict of interest is possible only if the official has discretionary powers, i.e., the freedom to choose or make decisions within the scope of his or her competence.

In accordance with the provisions of legislation, individuals are required to report actual or potential conflicts of interest no later than the next working day after they become aware or should have become aware of their existence. The report is submitted to the immediate supervisor, and in their absence, or if the person holds a position that does not provide for a direct supervisor, or is a member of a collegial body, the relevant information should be submitted to the National Agency for Corruption Prevention (NACP) or another body or collegial body specified by law, during the activities of which the conflict of interest arose.

Proper resolution of conflicts of interest is not only a legal obligation, but also a manifestation of professional integrity, which helps maintain public trust in public service and state institutions.