REPUBLIC OF SERBIA ANTI-CORRUPTION AGENCY THE FIRST REPORT ON OVERSIGHT OF POLITICAL ENTITES 2012 ELECTION CAMPAIGN COSTS

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1 REPUBLIC OF SERBIA ANTI-CORRUPTION AGENCY THE FIRST REPORT ON OVERSIGHT OF POLITICAL ENTITES 2012 ELECTION CAMPAIGN COSTS Belgrade, May 2013

2 Translation of this document has been provided through a USAID funded Judicial Reform and Government Accountability Project. 2

3 TABLE OF CONTENTS INTRODUCTION 5 1. DATA USED FOR THE ANALYSIS AND OVERSIGHT OF FINANCIAL REPORTS Collection of data during the election monitoring campaign Concept and structure of monitoring Collection and exchange of data Purpose and importance of monitoring Collection of data from state authorities, banks, legal entities and natural persons Advertising via media outlets Advertising by election material Public event organization SUBJECT TO OVERSIGHT FINANCIAL INDICATORS Income s from natural persons s from legal entities Expenditures Public advertising Election Material Other expenses Public events COMPARISON OF PRESENTED INCOME AND EXPENDITURES Comparative Review of Income and Expenditures ELECTORAL BOND RECOMMENDATIONS IN THE COURSE OF OVERSIGHT 38

4 7. FACTS INDICATING VIOLATIONS OF THE LAW ON FINANCING OF POLITICAL ACTIVITIES AND PHENOMENA OBSERVED DURING INCOME AND EXPENDITURES OVERSIGHT Facts indicating violations of the Law observed in income and expenditures oversight Failure to submit the report on election campaign costs Formal irregularities Failure to present the election campaign income and costs Unspent funds from the election campaign Settling the expenses of an election campaign using an account opened for raising funds and paying the expenses of another election campaign Settling election campaign expenses using an account that was not opened for election campaign financing s from legal persons that failed to satisfy their dues on the basis of public income Failure to submit data on the request of the Agency Phenomena indicating violations of the Law during income and expenditure oversight Uncovered Liabilities Indebtedness Donors and Donor Income Election Campaign Donors Registered After Call for Elections Local Government Entities As Donors Of s NEXT STEPS 53 ANNEX 1 ANNEX 2 ANNEX 3 ANNEX 4 ANNEX 5 OVERVIEW OF LISTS OF CANDIDATES BY LOCALES FOR WHICH THE REPORTS WERE NOT SUBMITTED BY 24 APRIL 2013 OVERVIEW OF THE HIGHEST AND LOWEST DONATIONS MADE BY NATURAL PERSONS AND LEGAL ENTITIES LISTED BY ELECTORAL LEVELS OVERVIEW OF NON-FINANCIAL CONTRIBUTIONS MADE BY NATURAL AND LEGAL PERSONS, LISTED BY ELECTORAL LEVEL, WITH AN INDICATION OF NON- FINANCIAL CONTRIBUTION TYPE REVIEW OF POLITICAL ENTITIES DUES NOT SATISFIED BY THE DAY OF FILING OF THE AGENCY S REPORT LIST OF LEGAL ENTITIES WITH DEBTS NOT SETTLED ON THE DAY OF REPORT SUBMISSION 4

5 INTRODUCTION On May 6, 2012, in the Republic of Serbia, elections were held for the President of the Republic, Members of Parliament (MPs) of the National Assembly of the Republic of Serbia, deputies of the Autonomous Province of Vojvodina (APV) Assembly, and councilors of assemblies of the local selfgovernment units 1. All participants in the election campaign in the period from the day of calling the elections till the day of proclamation of the final results were generically named political entities, which we may, in terms of the Law on Financing of Political Activates 2, differentiate into political parties, coalitions, and groups of citizens. Every political entity that participated in the election campaign, whether it nominated a candidate or filed an electoral list, had the following obligations in terms of the Law: Obligation to open a special-purpose account for funds raised to finance every election campaign, and to pay all election campaign expenses from that account (Article 24); Obligation to appoint a person responsible for lawful financing of political campaigns and submission of a report, as well as to inform the Agency about the appointment of said person within three days of his/her appointment (Article 31); Obligation to submit to the Agency a report on election campaign costs containing data on the origin, amount, and structure of raised and spent funds from both public and private sources; to submit the report in a form, whose content is established by the Rulebook on and Asset Records, Annual Financial Report, and the Report on Election Campaign Expenses of a Political Entity 3 ( Official Gazette of the RS, nos. 72/11 and 25/12), in a way stipulated by the Law and Rulebook and in compliance with the time limit of 30 days from the day of publication of final election results for electronic submission plus a written report 8 days after the electronic submission; 1 In the city of Belgrade Assembly and assemblies of other 22 towns of the republic of Serbia (Valjevo, Vranje, Zajeĉar, Zrenjanin, Jagodina, Kragujevac, Kraljevo, Kruševac, Leskovac, Loznica, Niš, Novi Paraz, Novi Sad, Panĉevo, Poţarevac, Smederevo, Sombor, Sremska Mitrovica, Subotica, Uţice, Ĉaĉak and Šabac), Municipal Assemblies (except for AranĊelovac, Bor, Kosjerić, Kovin, Negotin, Odţak and Vrbas) and City Municipla Assemblies (except for Voţdovac and Zemun). 2 Official Gayette of the Republic of Serbia, No. 43/11. 3 Official Gayette of the Republic of Serbia, Nos. 72/11 and 25/12. 5

6 Obligation to, upon the Agency s request, submit all data, during the campaign and afterwards, needed by the Agency so as to conduct all tasks related to oversight of election campaign financing (Article 32). The Anti-Corruption Agency, whose competence comprises (Article 5 of the Law on the ACA) the tasks stipulated by the Law on Financing of Political Activities, which regulates source and mode of financing of political activities of political parties, coalitions and group of citizen, has the following rights (Articles and 32-34): Right to have direct and free access to bookkeeping records and documentation and financial reports of both political entity and endowment and foundation founded by political party; Right to send a request to a political entity to submit all requested documents and information within a time limit not exceeding 15 days (during the election campaign, not exceeding 3 days); Right to send a request to any authority of the Republic of Serbia, Autonomous Province, and local self-government units, banks, as well as to natural persons and legal entities financing political entities, or which on their behalf and for their account provided certain service, asking them to send information, in which process all prohibitions and restrictions regarding submission of information stipulated by other regulations are not implemented; Possibility to engage relevant experts and institutions; Possibility to, after financial report oversight, send a request to the State Audit Institution to audit the reports in accordance with the law regulating competencies of the SAI; Right to organize independent monitoring of election campaigns within the election campaign expenses oversight tasks, for which funds from the budget of the Republic of Serbia are allocated to the Agency; Right to adopt by-laws regulating the content and manner of keeping of records on assets and contributions, as well as those regulating the content of the annual financial statement and report on election campaign expenses. Furthermore, the Agency was granted certain authorities in case of violation of the Law (Articles and Articles 42-43): To impose a warning measure on a political entity if in the oversight procedure it establishes some irregularities that might be corrected; To file a motion to institute a criminal or misdemeanor proceedings; 6

7 To, after the start of a criminal or misdemeanor proceedings, send a request to the ministry competent for financial affairs, or the relevant province authority, or local self-government authority, to issue a decision on temporary suspension of transfer of funds from public sources to a political entity until a final decision in the criminal or misdemeanor proceedings is rendered; To, in case of conviction for a criminal offense or if a political party or a responsible person in a political entity is convicted for a misdemeanor, issue a decision on the loss of rights to public funds for financing of regular work of a political entity for the next calendar year. The decision also established the amount of funds to be suspended. 7

8 1. DATA USED FOR THE ANALYSIS AND OVERSIGHT OF FINANCIAL REPORTS 1.1. Collection of data during the election monitoring campaign Concept and structure of monitoring The new Law on Financing of Political Activities, which entered into force in June 2011, introduced an important novelty when it comes to an oversight of the money flows through the transactions of political entities. This complex and responsible task was entrusted to the Anti-Corruption Agency. The first step undertaken by the Agency to ensure financial transparency in the campaign was through the organization of a monitoring process in 2012 so as to monitor the activities of political entities during their campaign for the president of the Republic, MPs, deputies, and councilors. This process is very important in the period of election cycles, when the dynamic of financial transactions of political entities is at the highest level. In November 2011, the Agency initiated all preparations for the monitoring processes. In the same month, the Agency adopted a Rulebook on Election Campaign Monitors, regulating organization, competences, rights, obligations, terms, and manner of selection of monitors for the election campaign cost oversight procedure. On the basis of a Decision by the Agency s Director, a network comprising 165 monitors was formed, and they were deployed in 23 towns throughout the Republic of Serbia (Belgrade and 22 other towns). ECONOMIC CLASSIFICATION Table 1: Overview of funds from the budget of the RS the ACA spent of 2012 election campaign monitoring ITEM NAME IN THE BUDGET EXPENDITURES (RSD) 421 CURRENT COSTS (LANDLINE COSTS, AND OTHER CURRENT COSTS) 222, TRANSPORTATION COSTS 25, SERVICES PER AGREEMENTS (ENGAGEMENT OF MONITORS) 35,566, OTHER COSTS 1,146, STATIONARY, FUEL COSTS, ADDITIONAL EQUIPMENT 270, MACHINES AND EQUIPMENT (COSTS OF MOBILE TELEPHONE, CAMERAS, DICTAPHONES, AND SO FORTH) 1,168, TOTAL 38,397,

9 As shown in Table 1, the amount spent for the monitoring totaled RSD 38,397,000.00, specifically: landline costs and other current costs RSD 222,000.00, transportation costs RSD 25,000.00; services per agreements for engagement of monitors RSD 35,566,000.00, other costs RSD 1,146,000.00; materialstationary, fuel costs, additional equipment RSD 70, and machines and costs of mobile telephones, purchase of cameras, dictaphones for the monitors RSD 1,168, Monitors were organized as a pyramid organization of three levels: Field monitors (132) whose task was to directly, in the field in towns they were deployed to, monitor and make records of all activities of political entities. They submitted weekly reports on their activities to relevant coordinators. Coordinators (23) were deployed to towns and county municipalities, and were tasked not only to organize and supervise the work of the field monitors, but also to monitor and record all activities of political entities. They were authorized to communicate with political entities and state authorities, if needed, so as to get information related to election campaign. Each coordinator was obliged to submit a report to central coordinators about the activities of every political entity from the territory they were in charge of, on the basis of the reports of field monitors they supervised, and their own direct monitoring. Central coordinators (10) were tasked to supervise and instruct coordinators of certain districts, prepare and process reports of coordinators, and submit their own reports to the Secretariat of the Agency. Central coordinators collected and classified data in two ways: 1. for every political entity from the towns whose coordinators they supervised, and 2. each central coordinator was obliged to exchange information with the other nine colleagues so as to collect all data about activities of one political entity at the level of the Republic of Serbia for all election levels Collection and exchange of data When the network of monitors was established, the scope of monitoring throughout the campaign was defined, i.e., activities of the political entities to specifically pay attention to in the monitoring process were defined. The Law on Financing of Political Activities encompasses with the generic name political entity a political party, coalition, or group of citizens as a potential submitter of registered electoral lists and nominator of candidates whose activities are monitored throughout election campaign from the day of 9

10 calling elections until the day final election results are proclaimed. All data about election material, public events, and appearances in local media outlets were collected. When it comes to election material, the first thing to be noted was how many different election materials existed whether they were leaflets or any other promotional material such as pens, flags or lighters, whether they were glued, or there were billboards. Further on, which level of elections the election material referred to whether to parliamentarian, provincial, presidential, or local elections, or if the material was general election material to be used for promotion at all levels of elections. And finally, attention had to be paid to the location and time of distribution of election material, as well as to the quantity. Public events subject to monitoring encompassed mass rallies, conventions, stands, press conferences, and other public events organized around points and stands. When monitoring public events, every monitor was supposed to record everything related to the costs of the monitored political entity. The system for data collecting relied mainly on field monitors who attended all public events and happenings, recorded distributed election material (type and quantity), made notes of activities that could have represented costs, and documented them with photo or video material. These data were, on a weekly basis, presented in reports submitted to coordinators who, through their central coordinators, forwarded them to the Secretariat of the Agency. When it comes to the local media outlets, both printed and electronic, monitors were obliged to determine whether a certain political entity advertised there and how many types of advertising it had with a media feature Purpose and importance of monitoring Monitoring, to a great extent, encourages the submission of reports by political entities not only to fulfill a mere form and obligation, but rather to ensure there is closer to the real situation. Political entities were not aware of what events monitors recorded, and that was a motivating factor to present their activities in a more regular fashion. Finally, the purpose of the monitoring process was to have a greater portion of the funds used in gradually more expensive campaigns put in legal channels Collection of data from state authorities, banks, legal entities and natural persons A number of sources of information existed for every mentioned political activity during the election campaign, in that the Agency, while overseeing the reports on election campaign costs, was not only 10

11 relying on data collected by monitoring. Data were also collected from state authorities (ministries in charge of financial affairs, labor and social policy, the interior, and tax administration), APV authorities, local self-government authorities relevant for financial affairs, Republic Pension and Disability Insurance Fund, Republic Broadcasting Agency, banks, legal entities and natural persons Advertising via media outlets During the election campaign, political entities spent most of their funds for advertising of their representatives and political ideas via media outlets. The scope of advertising can be classified into four categories according to the type of media outlet: TV advertising, radio advertising, internet advertising, and printed media advertising. For each of these types of advertising it was necessary to have different sources of information to be able to do meaningful analysis. As per national televisions, data about the presence of political entities in advertising were received by the Republic Broadcasting Agency (RBA) and these data were used as a starting point for further searching of data from other entities. Based on the advertising information, requests were sent to media outlets asking them to submit information about agreements, advertising time frames, type of advertisements, and the amount of funds spent by political entities. Besides the advertising information political entities submitted in their reports, it often occurred that different agencies were hired to do this job. They were therefore asked to give the specification of service they provided to political entities for TV advertising. As for television stations with regional and/or local coverage, the process of collection of data about political entities advertising in their programs went in a different manner. For the majority of these stations, RBA does not have any data about the scope of advertising of political entities. It was therefore the obligation of the monitors engaged by the Agency to observe which political entities advertised themselves on local media outlets during the election campaign. These data served as a basis to send a request to the stations asking them to submit information about the type of a advertisement, scope of advertising, and amount of funds spent by each political entity which advertised there. These data were compared with those provided in the political entities reports on election campaign financing. This way, their validity was confirmed, or discrepancies noted between the realistic situation and what political entities presented in their reports. Radio advertising data of political entities, whether concerning radio with national, regional, or local coverage, were also collected from a number of sources. First, the Agency s monitors recorded data concerning political entities that used radio advertising. These data served as the basis for a request to 11

12 these radio stations asking them to submit information about the type of advertisement, scope of advertising, and amount of funds spent by each political entity for the type of the provided services. The reports of political entities contain data about the types of advertisements, but also about the agencies political entities engaged to do the advertising on their behalf. These agencies were also asked to provide a copy of the agreement signed with parties and with radio stations which provided these types of services, so as to compare all mentioned data in the reports and in this way confirm their validity. Internet advertising was monitored by the network of monitors, and web pages where political entities advertisements were posted were also determined. Since there were a huge amount of possible advertising places, several dozen web pages were singled out and requests were sent to their addresses asking them to provide information about the type of advertisement, scope, and amount of funds political entities spent on their sites. Printed media were treated similarly to television, radio stations, and internet, with information about political entities advertising requested. Data received by the monitors served as a framework for further requesting of information from specific media outlet, while data on the agencies hired to the advertisement job on their behalf were presented in the political entities reports. All these information about the same political activity served for data comparison and check of validity of data presented in the political entities reports on political campaign financing Advertising by election material The next significant segment within the activities of political entities concerns their outdoor advertising by the mean of façade advertisements, billboards, trivision billboards (billboards with three pictures), roof boards, neon lamps, boards with supporters, autographicons, information boards at bus stops, billboards and similar tools. The most notable form of this kind of advertising is billboards. Data about this type of advertising were primarily collected by the network of monitors. The purpose of these data was to collect from all service providers information about the political entities that used their advertising services, and to compare the data with the data presented by political entities in their reports on election campaign costs Public event organization Types of public events were numerous, with the following the most important: mass rallies (outdoor gathering), conventions (indoor gathering), stands (small gatherings organized in streets or village 12

13 centers) By their nature, these are the events whose only goal is to inform as many citizens as possible, and they were therefore subject of monitoring, and consequently a very important item in the oversight procedure and analysis of financial reports by political entities. Data about public events were gathered from a number of different sources. In addition to data about the event itself, the Agency s monitors collected information about technical support used for the event, for instance whether there was a stage, sound system, lights, special decoration, organized transportation of participants (buses, registration plates of buses, name of transportation company and so forth). All those who provided different services to political parties related to their activities were also asked to provide relevant data. Requests for information were sent to transportation companies observed to have transported part followers and members. Information was also requested in accordance with the elements of agreements the mentioned companies had concluded with political entities or with agencies that represented them, regarding the scope of services and funds spent. 2. SUBJECT TO OVERSIGHT 13

14 Political entities were required to submit a report on election campaign expenses to the ACA within thirty days following the announcement of election results, on a form specified by the Rulebook on and Asset Records, Annual Financial Report, and the Report on Election Campaign Expenses of a Political Entity. In the case of a political entity that is a coalition, a coalition agreement determines the coalition member that will submit the report on its behalf. The report is to be submitted in paper and electronic form, and is considered complete when submitted in both forms. Political entities are required to submit the report electronically within thirty days, and on paper eight days following electronic submission. Electronic submission of the report is done by entering the report in the application software of the Agency using a program-generated password. The person submitting the report is given a unique password confirming report registration (i.e. receipt of the report in electronic form). The report in written form should contain this unique password, the date of electronic report submission, date and place of writing the report in paper form, signature of an authorized person, and the seal of the political party or parties forming a particular coalition. The data in electronic and written form must be identical. Although elections at various levels were held the same day, on May 6, 2012 (except for the elections that went to a second round, on May 20, 2012, and the repeated elections at some polling stations), the deadline for report submission was not equal for all the participants of the electoral process. Namely, the deadline for report submission is linked to the date of the announcement of final election results. In the procedure of overseeing report submission timeliness, the Agency encountered the problem of great inconsistency as to the local level electoral committee practice regarding final election result announcement (publishing election results in official journals before the expiry of the deadline for using legal means in the electoral process, failure to announce final election results). Elections were not held in nine local self-government units; therefore report submission was not required. In the majority of cases, political entities failed to comply with the specified deadline; consequently, reports on 2012 election campaign expenses were submitted to the Agency even in The last report included in this analysis was submitted on 24 April The delay primarily occurred in the cases of municipality-level reports on election campaign expenses. Table 2: Overview of submitted and non-submitted reports on election campaign costs of five coalitions and DSS for all election levels ELECTION LEVEL TOTAL REPORTS SUBMITTED TOTAL REPORTS Elections for President of the Republic of Serbia

15 Elections for MPs of the National Assembly of the Republic of Serbia Elections for deputies of the Assembly of AP Vojvodina Elections for councilors of town assemblies Elections for councilors of municipal assemblies TOTAL 1, Political entities were required to submit reports for 1,656 lists of candidates. In total, 1,076 reports were submitted at all levels, accounting for 65% of the total number of reports required. In all, 580 reports were not submitted. The non-submitted reports include thirteen summary reports (a single report for several election campaigns) submitted by political entities. This number of reports does not encompass the reports on expenses of campaigns for the election of deputies to the Assembly of the APV through the majority voting system. Namely, deputies are elected to the APV Assembly through a mixed electoral system. Sixty deputies are elected through the majority voting system, and sixty through a system of proportional representation. Political entities were required to submit one report for the election of deputies to the Assembly of AP Vojvodina, regarding elections conducted through the proportional representation system, and up to sixty reports for elections conducted through the majority voting system, depending on the number of election units for which political entities presented a candidate. Some political entities indicated the funds for both electoral systems on a single I2 form, which is included in the financial analysis but not in the number of reports. With the purpose of analysis and oversight, this report includes a sample of six political entities which simultaneously won mandates in the Assembly of the Republic of Serbia: Choice for a Better Life (Izbor za bolji ţivot) Boris Tadić (hereinafter: DS coalition), United Regions of Serbia - MlaĊan Dinkić (hereinafter: URS coalition), Ĉedomir Jovanović Overturn (Preokret) (hereinafter: LDP coalition), Let s get Serbia Moving (Pokrenimo Srbiju) Tomislav Nikolić (hereinafter: SNS coalition), Democratic Party of Serbia Vojislav Koštunica (hereinafter: DSS), Ivica Daĉić Socialist Party of Serbia (SPS), Party of United Pensioners of Serbia (PUPS), and United Serbia (JS) (hereinafter: SPS coalition). The report comprises these entities lists of candidates for the election of MPs of the National Assembly of the Republic of Serbia, i.e. parliamentary elections, President of the Republic of Serbia, i.e. presidential elections, deputies of the Assembly of the Autonomous Province of Vojvodina, i.e. provincial elections, and councilors of town assemblies. 15

16 As regards the elections of MPs, the DS coalition was comprised of: the Democratic Party (DS), the Social Democratic Party of Serbia, the League of Social Democrats of Vojvodina (LSV), the Christian Democratic Party of Serbia, the Green Party of Serbia, and the Democratic Party of Croats in Vojvodina. Coalition structure varied depending on the electoral process. In various combinations, the DS coalition consisted of the following political entities at different electoral levels: the Democratic Party (DS), the Green Party of Serbia, the Liberal Democratic Party (LDP), the Democratic Alliance of Croats in Vojvodina, the Sandţak Democratic Party, the Party for Sandţak, Pulse of Serbia, and the Movement for Uţice. The SNS coalition for the election of MPs included: the Serbian Progressive Party (SNS), New Serbia (NS), the Power of Serbia Movement BK, People s Peasant Party, Bosniak People s Party, Democratic Party of Macedonians, Roma Party, Vlach Unity Movement, Socialist Movement, and the Movement for the Economic Revival of Serbia. The composition of the coalition varied depending on the electoral process. In various combinations, the SNS coalition was formed by the following political entities at different election levels: the Serbian Progressive Party (SNS), New Serbia (NS), Power of Serbia Movement BK, People s Peasant Party, Bosniak People s Party, Democratic Party of Macedonians, Roma Party, Vlach Unity Movement, Socialist Movement, Movement for the Economic Revival of Serbia. The SPS coalition for the election of MPs was formed by: the Socialist Party of Serbia (SPS), Party of United Pensioners of Serbia (PUPS), United Serbia (JS). The composition of the coalition varied depending on the electoral process. In various combinations, the SPS coalition was formed by the following political entities at different election levels: the Socialist Party of Serbia (SPS), Party of United Pensioners of Serbia (PUPS), United Serbia (JS), and the Serbian Radical Party (SRS). The LDP coalition for MP elections was formed by: the Liberal Democratic Party (LDP), Serbian Renewal Movement (SPO), Social Democratic Union, Rich Serbia, Vojvodina Party, Democratic party of Sandţak, Green Ecological Party Green, and the Party of Bulgarians of Serbia. In various combinations, the LDP coalition was formed by the following political entities at different election levels: the Liberal Democratic Party (LDP), Serbian Renewal Movement (SPO), Democratic party of Sandţak, Rich Serbia, Vojvodina Party, Social Democratic Union, Green Ecological Party, and the Party of Bulgarians of Serbia. The URS coalition for the election of MPs was formed by: G17 Plus, the Movement Live for Krajina ( Ţivim za Krajinu ), Together for Šumadija ( Zajedno za Šumadiju ), and the National Party. In different combinations the URS coalition was formed by the following political entities at various levels 16

17 of elections: G17 Plus, the Movement Live for Krajina ( Ţivim za Krajinu ), Together for Šumadija ( Zajedno za Šumadiju ), the National Party, the Sandţak National Party, the Bunjevci Party, the Democratic Party of Bulgarians, the Vlach Democratic party, the Coalition for Pirot. Apart from the mentioned political entities, the URS list and candidates were endorsed by numerous citizen groups which entered the coalition mainly in elections for local councilors. The Democratic Party of Serbia (DSS) participated independently in the MP elections. At various election levels, DSS participated either independently or in coalition with different combinations of the following political entities: the Democratic Party of Serbia (DSS), Serbian Radical Party (SRS), Serbian Progressive Party (SNS), New Serbia (NS), Power of Serbia Movement BK, Socialist Movement, Democratic Party of Macedonians, Go Banat Movement ( Napred Banat ), Serbian Democratic Party, and the United Peasant Party. Political entities included in this analysis were required to submit 877 reports to the ACA. Of those, 707 reports were submitted, accounting for 80% of the total number, and 170 reports were not submitted, as presented in the following overview: Table 3: Overview of the submitted and non-submitted reports on election campaign costs for the five coalitions and DSS POLITICAL ENTITY SUBMITTED REPORTS NOT SUBMITTED REPORTS SNS coalition SPS coalition URS coalition DS coalition LDP coalition DSS TOTAL Annex 1 gives an overview of lists of election candidates by locations for which reports were not submitted by these six political entities. The number of reports required for submission from these six political entities accounts for 53% of the total number of reports required for submission to the Agency from all political entities. The number of reports submitted by these six political entities accounts for 65% of the total reports submitted by all political entities. Total reported income of these six political entities, compared to the total income of all 17

18 political entities, accounts for 80.8%, while the share of their reported expenditure in the total expenditure is 83.2%. 3. FINANCIAL INDICATORS 18

19 The total reported income of all political entities at all election levels amounted to RSD 3,109,834,700.00, of which income from public funds amounted to RSD 1,916,251,944.00, or 61.6%, while reported expenditure amounted to RSD 3,576,057, The data used in the analysis and oversight are contained in the financial reports submitted by the six aforementioned political entities Income The six aforementioned political entities raised a total income of RSD 2,513,268, The following table shows the income raised by election levels: POLITICAL ENTITY Table 4: Overview of income of the five coalitions and DSS by election type in 2012 PRESIDENTIAL PARLIAMENTARY PROVINCIAL TOWN ASSEMBLY TOTAL DS coalition 352,903, ,024, ,749, ,456, ,011,134, SNS coalition 255,811, ,185, ,295, ,685, ,978, SPS coalition 41,588, ,274, ,960, ,255, ,078, URS coalition 39,000, ,898, ,113, ,012, LDP coalition 42,398, ,692, ,580, ,072, ,743, DSS 41,100, ,400, ,530, ,289, ,321, TOTAL 772,803, ,370,477, ,115, ,872, ,513,268, As presented in Table 4, the majority of income was made at parliamentary elections, amounting to RSD 1,370,477,021.83, which accounts for 54.5%, followed by RSD 772,803,073.46, i.e 30.8% at presidential elections, RSD 260,872,946.42, or 10.4% at city assembly elections, and the lowest income was made at provincial elections, in the amount of RSD 109,115,401.98, i.e. 4.4% Table 5: Overview of income types for the five coalitions and DSS by election type in

20 TYPE OF INCOME OF POLITICAL ENTITY PRESIDENTIAL PARLIAMENTARY PROVINCIAL TOWN ASSEMBLY RSD % RSD % RSD % RSD % Funds from public sources s from natural persons s from legal entities Own funds Credits and loans TOTAL As presented in Table 5, as per the structure of income, presidential elections were primarily financed from public funds (84.3%); As per the structure of income, parliamentary elections were primarily financed from public funds (53.0%), followed by credits and loans (29.9%); As per the structure of income, provincial elections were primarily financed by contributions from natural persons to political entities (49.6%) and from public funds (33.4%); As per the structure of income, the elections for town assemblies were primarily financed from public funds (39.6%) and contributions from natural persons to political entities (25.4%). DS COALITION Funds from public sources s from natural persons s from legal entities Table 6: Overview of income types of the DS coalition by election type in 2012 PRESIDENTIAL PARLIAMENTARY PROVINCIAL TOWN ASSEMBLY RSD % RSD % RSD % RSD % 249,135, ,025, ,075, ,743, , ,069, , ,955, ,530, ,805, Own funds 3,728, ,400, ,193, ,951, Credits and loans 100,000, ,000, TOTAL 352,903, ,024, ,749, According to the data provided, the DS coalition raised the majority of its income for the presidential elections from public funds, with a significant share of credits, while for the parliamentary elections, income had the highest share of credits and public funds; for the provincial elections the majority of income was raised from public funds, and for the town assembly elections, from its own funds. 20

21 SNS COALITION Funds from public sources s from natural persons s from legal entities Table 7: Overview of income types of the SNS coalition by election type in 2012 PRESIDENTIAL PARLIAMENTARY PROVINCIAL TOWN ASSEMBLY RSD % RSD % RSD % RSD % 249,135, ,691, ,326, ,119, , ,397, , ,047, , Own funds Credits and loans 6,500, ,096, TOTAL 255,811, ,185, ,295, ,685, The SNS coalition raised the majority of its income for presidential, parliamentary, provincial, and town assembly elections from public funds. SPS COALITION Funds from public sources s from natural persons s from legal entities Table 8: Overview of income types of the SPS coalition by election type in 2012 PRESIDENTIAL PARLIAMENTARY PROVINCIAL TOWN ASSEMBLY RSD % RSD % RSD % RSD % 38,328, ,138, ,790, ,870, ,260, ,158, ,853, ,695, ,700, ,516, ,364, Own funds , ,800, ,324, Credits and loans TOTAL 41,588, ,274, ,960, ,255, The SPS coalition raised the majority of its income for presidential, parliamentary, and town assembly elections from public funds, while contributions from natural persons were the largest share for the provincial elections. Table 9: Overview of income types of the URS coalition by election type in

22 URS COALITION Funds from public sources s from natural persons s from legal entities PRESIDENTIAL PARLIAMENTARY PROVINCIAL TOWN ASSEMBLY RSD % RSD % RSD % RSD % 38,328, ,363, , ,040, ,585, ,434, , ,932, ,654, Own funds 22, ,590, , , Credits and loans ,426, TOTAL 39,000, ,898, , ,113, The URS coalition raised most of its income for the presidential elections from public funds; for the parliamentary elections, the biggest sources of income were credits, and for the provincial and town assembly elections, most income was raised from public funds. URS COALITION Funds from public sources s from natural persons s from legal entities Table 10: Overview of income types of the LDP coalition by election type in 2012 PRESIDENTIAL PARLIAMENTARY PROVINCIAL TOWN ASSEMBLY RSD % RSD % RSD % RSD % 38,328, ,696, ,566, ,165, , ,281, , , ,000, ,715, , Own funds ,00 0,0 Credits and loans ,00 0,0 TOTAL 42,398, ,692, ,580, ,072, The LDP coalition raised most of its income for presidential, parliamentary, provincial, and town assembly elections from public funds. Table 11: Overview of income types of the DSS by election type in

23 URS COALITION Funds from public sources s from natural persons s from legal entities PRESIDENTIAL PARLIAMENTARY PROVINCIAL TOWN ASSEMBLY RSD % RSD % RSD % RSD % 38,328, ,251, ,530, ,258, ,955, ,149, ,115, ,685, Own funds 816, , Credits and loans TOTAL 41,100, ,400, ,530, ,289, DSS raised most of its income for presidential, parliamentary, provincial, and town assembly elections from public funds s from natural persons A contribution is an amount of money, excluding dues, granted voluntarily to a political entity by a natural or legal person; a gift; or services provided without recompense, or under conditions different than those of the market. s also include credits, loans, and other services provided by banks and other financial organizations in the Republic of Serbia, under conditions different than market conditions, as well as the write-off of debts. Upon inspection of the reports on election campaign expenses of political entities, it has been observed that natural and legal persons appear as providers of both financial and non-financial contributions. Nonfinancial contributions included the use of office space, newspaper advertising design, lease of advertising space for billboard advertisements, printing of election material, making of commercial videos, TV advertising, food contributions, organization of stage performances, transportation by private vehicle, and office material. The Law on the Financing of Political Activities determines the maximum amount of contributions a natural or legal person can make to one or several political entities. The amount for natural persons is 20, and for legal persons 200, average monthly income before taxes and benefits. However, these limits may be doubled during the election year, and amount to 20 and 200 average monthly incomes, respectively, for election campaigns, plus the same amount for regular work. 23

24 According to data from the authority competent for statistics in the RS, the average monthly income in 2011 was RSD 37,985.00, meaning that the maximum amount of contributions a natural person could make to a political entity for the 2012 election campaign was RSD 759,703.00, or RSD 7,597, for legal persons. Upon inspection of the reports on election campaign expenses, it has been determined that none of the political entities indicated a provider (natural or legal person) whose contribution exceeded the maximum amount. The total number of natural persons who made contributions to political entities in the 2012 election campaign at all election levels is approximately 6,000. The highest single financial and non-financial contributions to political entities are listed in the tables below. POLITICAL ENTITY Table 12: Highest financial contributions from natural persons for the five coalitions and DSS by political entity FINANCIAL CONTRIBUTION (RSD) SPS coalition 750, DSS 749, URS coalition 719, LDP coallition 700, DS coalition 249, SNS coalition 22, POLITICAL ENTITY Table 13: Highest values of non-financial contributions from natural persons for the five coalitions and DSS by political entity NON-FINANCIAL CONTRIBUTION (RSD) SPS coalition 250, DS coalition 80, SNS coalition 19, URS coalition 8, LDP coalition 0.00 DSS s from legal entities The total number of legal persons that made contributions to political entities in the 2012 election campaign at all election levels is 195. The LDP coalition and the SNS coalition did not disclose nonfinancial contributions. Of the above number, the highest total single financial and non-financial contributions to political entities are listed below. 24

25 Table 14: Highest financial contributions from legal entities for the five coalitions and DSS by political entity POLITICAL ENTITY FINANCIAL CONTRIBUTION (RSD) DS coalition 7,500, URS coalition 7,500, SPS coalition 6,000, LDP coalition 4,000, SNS coalition 500, DSS 165, POLITICAL ENTITY Table 15: Highest values of non-financial contributions from legal entities for the five coalitions and DSS by political entity NON-FINANCIAL CONTRIBUTION (RSD) URS coalition 5,519, DSS 4,300, SPS coalition 715, DS coalition 200, LDP coalition 0.00 SNS coalition 152, Annex 2 gives an overview of the highest and lowest financial contributions from natural and legal persons by election level. Annex 3 gives an overview of non-financial contributions from natural and legal persons presented by election level, with indications of the type of non-financial contribution Expenditures Political entities covered by this report presented total expenditure of RSD ,39 as: Table 16: Overview of expenditures for five coalitions and DSS by types of 2012 elections POLITICAL ENTITY DS coalition PARLIAMENTARY PROVINCIAL TOWN ASSEMBLY TOWN ASSEMBLY TOTAL 352,903, ,910, ,213, ,167, ,054,195, SNS coalition 255,811, ,871, , ,755, ,738, SPS coalition 41,571, ,245, ,939, ,809, ,656, URS coalition 47,421, ,897, , ,537, ,395, LDP coalition 51,334, ,141, ,576, ,300, ,353, DSS 40,599, ,111, ,530, ,670, ,912, TOTAL , , ,64 318,241, ,975,

26 Parliamentary elections have the biggest share, 58.0%, in the total amount of the expenditures approximated at RSD 1,726,177, Next are presidential elections with a share of 26.8%, approximated at RSD 797,639,895.44; city elections, RSD 318,241, or 10.7%, and provincial elections of RSD 133,100, or 4.5%. Table 17: Overview of expenditure categories for five coalitions and DSS by types of 2012 elections EXPENDURE CATEGORY PRESIDENTIAL PARLIAMENTARY PROVINCIAL TOWN ASSEMBLY RSD % RSD % RSD % RSD % Election Materials 75,283, ,602, ,190, ,894, Public Events 19,266, ,893, ,239, ,247, Public Advertising 474,687, ,474,343, ,355, ,466, Other Election Materials 228,402, ,338, ,314, ,634, TOTAL 797,639, ,726,177, ,100, ,241, The structure of expenses indicates that the political entities spent most of their funds on advertising, RSD 2,193,852, (73.7% of total expenditures), followed by election material, RSD 334,970, (11.3%), and other election campaign expenses consisting of costs for supporting voters signature certification, other travel expenses, overhead and recurring costs, costs of engagement of marketing agencies, equipment and public opinion researchers, RSD 327,689, (11.0%), and the least funds were spent on public events, RSD 118,647, (3.9%). The data submitted by political entities show that the amount of other expenses is considerable, given that certain political entities outsourced marketing of their political campaign to professional agencies, and those expenses were indicated as other expenses contrary to their legal obligation. In the structure of expenditure for parliamentary elections, advertising costs are dominant (85.4%). Advertising costs have the highest share in the expenditure for presidential elections (59.6%) followed by other costs of election campaign (28.6%).Once again, advertising costs have the biggest share in the structure of provincial election expenditure (54.5%) along with the election material expenses (28.9%). 26

27 DS COALITION Table 18: Overview of expenditure categories of DS coalition by types of 2012 elections PRESIDENTIAL PARLIAMENTARY PROVINCIAL TOWN ASSEMBLY RSD % RSD % RSD % RSD % Election Materials 41,340, ,849, ,297, ,553, Public Events 14,477, ,890, , ,0 6,704, Public Advertising 281,620, ,099, ,4 33,164, ,8 127,336, Other election Materials 15,465, ,070, ,3 5,751, ,4 11,573, TOTAL 352,903, ,910, ,213, ,167, SNS COALITION Table 19: Overview of expenditure categories of SNS coalition by types of 2012 elections PRESIDENTIAL PARLIAMENTARY PROVINCIAL TOWN ASSEMBLY RSD % RSD % RSD % RSD % Election Materials 9,002, ,327, ,040, ,239, Public Events , ,287, Public Advertising 38,000, ,859, , ,369, Other Election Materials 208,806, , ,840, ,859, TOTAL 255,811, ,871, ,302, ,755, SPS COALITION Table 20: Overview of expenditure categories of SPS coalition by types of 2012 elections PRESIDENTIAL PARLIAMENTARY PROVINCIAL TOWN ASSEMBLY RSD % RSD % RSD % RSD % Election Materials 1,768, ,886, ,927, ,142, Public Events 638, ,470, ,218, ,758, Public Advertising 38,308, ,080, ,233, ,019, Other Election Materials 857, ,807, ,559, ,888, TOTAL 41,571, ,245, ,939, ,809, DSS Table 21: Overview of expenditure categories of DSS by types of 2012 elections PRESIDENTIAL PARLIAMENTARY 27 PROVINCIAL TOWN ASSEMBLY RSD % RSD % RSD % RSD % Election Materials 2,756, , , Public Events , , Public Advertising , Other Election Materials , , TOTAL , ,

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