The Congress will have the task of studying twelve bills submitted by the Executive to strengthen the anti-corruption legal framework in Paraguay. This initiative is part of the strategic plan of the Paraguayan State that incorporates new objectives and actions to successfully pass the evaluation of compliance with the 40 Recommendations of the Financial Action Task Force (FATF) on the progress in the Prevention and Fight against Money Laundering and Terrorist Financing, the results of which will be known in 2020.

The intention is to prevent Paraguay from being placed again on the Grey List of non-cooperating countries at the international level. It should be recalled that Paraguay managed to be excluded from this Grey List in 2012. At the same time, the objective is to adjust the national legislation to the “Inter-American Convention against Corruption” and the “United Nations Convention against Corruption”, ratified by Paraguay in 1996 and 2005, respectively.

These projects are also in line with management transparency policies to combat corruption in public administration, which included the creation of the National Anticorruption Secretariat (SENAC) in 2012.

The projects have a broad scope, covering institutional and structural issues, adjustment and creation of criminal types, measures for greater transparency and establishment of more effective procedures. The projects were the result of inter-institutional work with the participation of representatives of the Supreme Court of Justice, the Attorney General's Office, the Central Bank of Paraguay, the National Secretariat for the Administration of Seized and Confiscated Assets, the Public Prosecutor's Office and, from the private sector, the Association of Banks of Paraguay, among others.

Of the twelve bills submitted, six seek to create new laws, the main characteristics of which are summarized below:

1. Bill “Creating the Secretariat of Financial Intelligence and establishing the System for the Prevention and Mitigation of Risks of Acts Intended for Money Laundering”, amending Law 1.015/97 “On the Prevention of Money Laundering”.

It is intended to replace the Secretariat for the Prevention of Money or Asset Laundering (SEPRELAD), the country's current financial intelligence unit. The new Secretariat would have clear powers to internally organize its operation.

2. Bill “By which the special procedure for the application of confiscation, special confiscation, autonomous confiscation and deprivation of benefits and profits is created”..

It seeks to attack the assets of criminal organizations in the understanding that it constitutes an effective way to affect their operations, beyond the prosecution of their members who may have been identified in the investigations.

3. Bill “Creating the Registry of Final Beneficiaries of the Republic of Paraguay”.

In compliance with one of the FATF recommendations, this law would allow effective control of the beneficial owners of legal entities in Paraguay and the creation of a single registry of information that is currently scattered in several registries.

4. Bill “That prevents, typifies and punishes the punishable acts of transnational bribery and transnational bribery”.

Its purpose is to implement the provisions of the United Nations and Inter-American Conventions against Corruption by adapting the current legislation in this area, expanding the criminal offenses to include foreign public officials and officials of international organizations.

5. Bill “Whereby the procedure for the reception and dissemination of the lists of sanctions issued by the United Nations Security Council is established, as well as the inclusion and exclusion of natural or legal persons”.

In addition to complying with the international commitments assumed by Paraguay, it seeks to establish the procedure for the receipt and dissemination of these sanctions among the competent entities, as well as the procedure and criteria for the inclusion and exclusion of individuals and legal entities in the sanctions.

6. Bill “Whereby criminal courts of guarantees, criminal enforcement courts, sentencing courts, criminal appeals courts and prosecutorial agents specialized in money laundering, drug trafficking, kidnapping, financing of terrorism, corruption, organized crime.”

The purpose is that these economic crimes have specialized courts and tribunals and better control by centralizing the treatment of these crimes considered transnational, taking into account that the courts will have their seat in the Capital, with jurisdiction and competence throughout the national territory. This would decompress the workload of the judges of the ordinary courts to facilitate the timely processing of these cases.

The other six remaining bills seek to establish proposals to amend existing laws, as summarized below:

1. Modification of provisions of Law 1.160/97 “Penal Code”.

It seeks to modify the existing rules on confiscation and establish new punishable acts as precedents for money laundering, such as market manipulation, private bribery and bribery. Thus, it is also intended to protect the credibility of investors in our incipient stock market and also to extend the figures of bribery and bribery to the private sphere.

2. Amendment of Article 3 of Law 5.895/17 “which establishes rules of transparency in the regime of companies incorporated by shares”..

Law 5895/2017 provided for the end of bearer share companies in Paraguay. This bill seeks to amend Article 3 to expressly establish the deadline for the exchange of such shares and clarify the penalties in case of non-compliance.

3. Modification of Article 46 of Law 5. 876/17 “On the administration of seized and forfeited assets”, to reorganize the way in which seized and forfeited assets should be distributed, among SENABICO (agency specialized in the administration of seized and forfeited assets), the Public Ministry, SEPRELAD (or its projected replacement), the National Anti-Drug Secretariat, the National Police and projects for the rehabilitation of addicts and social reinsertion, and projects for the prevention of money laundering, organized crime, financing of terrorism, financing of the proliferation of weapons of mass destruction and drug trafficking.

4. Amendment of Articles 1, 2 and 3 of Law 4.024/10 “which punishes the punishable acts of terrorism, terrorist association and financing of terrorism”.

It inserts changes in the penalties, increasing the penalties and incorporating the punishable acts of recruitment and indoctrination, terrorist combatant abroad and apology of terrorism.

5. Amendment of Law 4.503/11 “on the immobilization of funds or financial assets”.

It aims to adjust the jurisdictional procedures to be followed in cases where there are indications that funds or assets may be linked to the financing of terrorism, weapons of mass destruction, acts of terrorism or terrorist association.

6. Repeal of Article 3 of Law 4.673/12, eliminating the prejudicialidad in punishable acts related to tax matters.

It seeks to include tax crimes as predicate offenses for money laundering, eliminating the prejudicial nature of punishable acts related to tax matters. Thus, this project also seeks to fight informality in the Paraguayan economy.

In Latin America and the world, in recent years there has been greater awareness of the negative effects of the phenomenon of corruption, giving rise to initiatives to encourage States to adopt measures to strengthen the integrity of public and private management systems. Several countries have already adopted their own instruments to promote the adoption of compliance programs and codes of conduct by companies.

In this context, these legal reforms are necessary to strengthen the national economy, improve Paraguay's confidence and credibility in the international community, thus increasing foreign investment and presenting Paraguay as a more reliable, transparent and competitive market, all of which would result in greater employment.