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The Case for Further Reform

NATO and the European Union: Leverage for Change

Slovakia’s troubling arms trade record undermined the country’s international standing and presented a potential roadblock to membership in NATO and the E.U. until shortly before both organizations announced in late 2002 they would invite Slovakia to join. Some in Slovakia’s government recognized this danger and spoke out publicly. In December 2001, for example, the then head of the Slovak Information Service noted that international partners had told him repeatedly that the country’s weapons control regime was considered unreliable.¹⁸⁷ A second official, the head of the National Security Office, agreed and emphasized the importance of this issue after the September 11, 2001, attacks in the United States. He commented, “The world looks very negatively on the fact that our arms traders falsify licenses and end-user certificates and are supplying global terrorist organizations with weapons and systems. Our priority should be adopting a radical solution to this problem.”¹⁸⁸ Elsewhere he noted, “Slovakia is considered a high-risk country from the viewpoint of trading in arms. Our firms and Slovak nationals are suspected of various shenanigans and links to illegal arms deals.”¹⁸⁹

While they were evaluating Slovakia’s membership bid, the E.U. and NATO let their concerns be known, if quietly. The E.U., for example, pointed out repeatedly that Slovakia had not fully implemented the criteria of the E.U. Code of Conduct, and it repeatedly drew attention to arms trade issues in the context of evaluating Slovakia’s membership bid.¹⁹⁰ A European Commission diplomat in Bratislava went so far as to comment publicly in late 2001 that “[a]rms control, or the lack thereof, is a matter of great concern to us,” and that “Slovakia needs to get its act together” with respect to arms export control.¹⁹¹ Weapons trade issues were raised in the context of NATO membership, with NATO allies confirming to Human Rights Watch that they have approached the Slovak government on particular arms trade cases.¹⁹² At times the issue has been raised in a more public, if less direct, manner. For example, the U.S. ambassador to NATO, speaking of the anticipated next round of NATO enlargement while visiting another candidate country, said in February 2002 that, among other things, NATO would look for “absence of corruption and reliable control over trade in arms” as part of the evaluation process.¹⁹³

Even with its admission to NATO and the E.U., Slovakia has not shed its image as an irresponsible arms trader. To the contrary, key NATO allies and the E.U. have maintained that this is an area of continued concern. The E.U., in an October 2002 report that concluded Slovakia was ready for E.U. membership, noted that the country was not fully living up to its commitment to follow E.U. guidelines on arms exports.¹⁹⁴ Similarly, on the eve of Slovakia’s invitation in November 2002 to join NATO, the U.S. ambassador to the alliance noted that illicit arms trafficking from the country continued to be a cause of serious concern.¹⁹⁵

The government of Slovakia, clearly sensitive to any doubts about its contribution to Euro-Atlantic security and to its credibility as a responsible partner, has sought to dispel such concerns. It has made some efforts to tighten controls. The problems are serious, however, and several areas still require attention. As stated by the Deputy Foreign Minister in November 2002, “It’s clear to everyone that we have to improve our controls, and steps are being taken.”¹⁹⁶ As is argued below, further steps are needed.

The Evolution of Slovakia’s Arms Trade Controls and the Need for Further Reforms

Since 1998, Slovakia’s arms trade has been governed by Act 179 on Trading in Military Material. In the wake of the Liberia helicopter scandal, this law was deemed inadequate, and in 2001 the government promised to revise it. Following passage in December 2001 of a limited amendment, the government set out to review and amend the legislation. In April 2002, following consultations among government ministries and with the Slovak defense industry, the cabinet approved draft legislation to amend the arms trade law and presented it for parliament’s consideration. The bill was adopted on July 2, 2002, and went into force on September 1, 2002.

In several respects, the bill represented an improvement over previous legislation. It introduced controls on arms brokers, gave greater emphasis to compliance with international commitments, clarified existing licensing procedures, improved regulatory controls designed to prevent diversion of weapons shipments to unauthorized destinations, and granted customs authorities greater power to inspect, detain, or send back suspicious shipments. The bill, however, fell short of the major overhaul needed, as will be discussed. Moreover, as will also be discussed, a number of important topics were not addressed in the law. Most notably, the revised law left in place a licensing exemption related to arms transit, neglected to regulate the activities of transport companies and shipping agents, failed to increase penalties, and did not enhance transparency over the arms trade, nor provide parliamentary oversight. It also formalized licensing procedures in a way that heavily concentrated power in the hands of one ministry.

The government of Slovakia has begun to face the challenge of improving its arms trade controls. It has made clear that it wishes to break from the behavior of the past, when, as described by a licensing official, “nothing was investigated, and that even if everyone knew the rules were being broken, the business somehow went on.”¹⁹⁷ The reforms to date, however, mark an incremental improvement that has been insufficient to fully address the challenge of controlling the arms trade. Further reforms are needed to tighten legal controls, as well as their implementation and enforcement.

An opportunity to pursue additional legislative changes may present itself in 2004. Slovak arms controls officials indicated in October 2002 and March 2003 that they intended to elaborate proposals for further legislative changes in this field. They said that the late 2001 and mid-2002 round of reforms were enacted as amendments to Act 179, due to time pressures, but that the goal now was to draft an entirely new law. The new law, they said, would be based on the provisions of Act 179, as amended, but reformulate them and add new measures, provided consensus on the latter could be reached.¹⁹⁸

Ensuring Strict Licensing

Understanding the Problem

Arms exports from Slovakia are subject to a two-staged licensing procedure in which the government grants a license authorizing companies or individuals to trade in weapons and also issues individual permits for each transaction. These individual permits are often themselves referred to as “licenses.” Statutory authority for issuing licenses rests with the Ministry of Economy. Until September 2002 it acted through a government licensing commission composed of representatives from the Ministries of Economy, Defense, Interior, and Foreign Affairs, with the Ministry of Foreign Affairs exercising veto power. At least for a period in 2002, the Customs Directorate and intelligence service also took part in considering license applications.

The status of the inter-ministerial licensing commission has been a subject of some debate. From the beginning, the commission was established as an advisory body without formal legal status. In practice, however, it exercised decision-making authority, with the Ministry of Economy issuing licenses only on the basis of consensual decisions by the commission. With the amendments to the country’s arms trade law in mid-2002, this legal contradiction was resolved. Rather than formally empower the licensing commission to make decisions, however, the revised law reaffirmed the authority of the Ministry of Economy. The law makes no reference to a licensing commission per se. Instead, it establishes that the Ministry of Economy issues both the authorization to trade in weapons and individual export and import licenses. The export control official at the Ministry of Economy argued that these changes were necessary to clarify lines of responsibility and ensure greater accountability in case a license was improperly issued. He added that granting statutory authority to the commission would have required the drafting of more complex legislation.¹⁹⁹

In September 2002, the legal reforms went into effect, and the Slovak cabinet allowed the mandate of the licensing commission, such as it was, to expire.²⁰⁰ Interim arrangements were put in place that reflected the Ministry of Economy’s primary role in licensing decisions, as outlined in the revised law, but preserved a measure of inter-agency consultation.²⁰¹ The interim consultation processes were formalized by the end of 2002.²⁰² Taken together, the July 2002 law and the consultation procedures set out the new arms licensing decision-making process.

For general trading authorizations the revised law establishes (at articles 5(2) and 10) that the Ministry of Economy is entitled to issue such licenses following the positive recommendation of the other designated government bodies, which are the Ministries of Defense, Foreign Affairs, and Interior, as well as the National Security Office. The law requires a consensus for a positive decision on trading license applications (at article 11). At the same time, it appears to grant the Ministry of Economy authority to deny such licenses even where the other bodies support an application, where required to protect foreign policy and security interests, when the applicant has been denied a trading license, or if a year has not passed since the applicant’s license was revoked. Similarly, the decision to revoke a trading license rests with the Ministry of Economy (at article 12(2)).

The Ministry of Economy arms licensing official explained in March 2003 the mechanism by which consultations occur and decisions regarding general arms trading authorizations are made. First, the Ministry of Economy reviews applications for such authorizations. If there are no irregularities, the ministry forwards the applications to the other ministries and government offices designated in the law and requests their views. If no problems are raised during this consultation, the Ministry of Economy approves the application and issues the authorization. If, on the other hand, objections are made about an application, the application can be referred to an expert group that meets weekly to discuss arms trade issues. That group is one of two advisory bodies formed to support the Ministry of Economy’s decision-making about arms licenses; it intervenes in decision-making about general arms trading applications only when there is a lack of consensus on an application supported by the Ministry of Economy. If a positive consensus cannot be reached among the appropriate authorities in the expert group, the application for a general arms trading authorization is denied.²⁰³

The Ministry of Economy has greater autonomy over licensing decisions regarding individual arms transactions, such as arms import or export permits. Under the revised law (at article 16(1)), the ministry “may request” the opinion of the Ministries of Defense, Foreign Affairs, and Interior and the National Security Office and any responses are due within thirty days. Such consultation is not spelled out in the July 2002 law, but instead form part of the regular consultation process, discussed below, that was agreed subsequently. The recommendations offered through such consultations generally are not binding on the Ministry of Economy. The sole exception outlined in the law (at article 16(3)) is that a negative decision by the Ministry of Foreign Affairs on an export license is binding, provided it responds within thirty days and offers a justification for its decision. As with general trading authorizations, decisions regarding the rejection or revocation of individual licenses are left to the Ministry of Economy and can be triggered by Slovakia’s foreign policy and security interests (articles 19 and 20).

The mechanism for consultation on individual permits differs from that for general trading authorizations and offers additional opportunities for input. The above-mentioned expert level advisory group, referred to as the Permanent Expert Group on Arms Trade Issues, plays a direct and early role in reviewing applications for individual arms transactions. The arms licensing official at the Ministry of Economy explained that in practice the weekly meetings of this expert group provide the Ministry of Foreign Affairs an opportunity to use its veto and thus halt consideration of an application. In addition, a second inter-ministerial advisory body with more senior representatives was created to examine cases where consensus to approve has not been reached by the expert group (including by those who are not granted veto power) and more discussion was thus warranted. This senior level body is known as the Minister of Economy’s Council on Arms Trade Issues. The Ministry of Economy hosts both advisory bodies, which also include representatives of the Ministries of Defense, Foreign Affairs, and Interior, as well as the Slovak Information Service and Customs Directorate, which are not cited in the law as having an advisory role on licensing. As of March 2003, the names of the members of both bodies had not been made public. The Information Department of the Ministry of Economy apparently felt that by keeping their names confidential it was protecting them from any outside efforts to influence their decisions.²⁰⁴

Ultimately, as noted, the Ministry of Economy in all cases makes the final decision on individual arms licenses and under the revised law has the power to overrule the recommendation of either or both advisory bodies, unless the Ministry of Foreign Affairs opposes an application. The result is that, in accordance with the revised law, the Ministry of Economy can override the decision of most of the government bodies on individual arms transaction but may issue such an export authorization only with the concurrence of the Ministry of Foreign Affairs. The export control official at the Ministry of Economy, questioned about the implications of this change and the concentration of licensing power in his ministry, denied that consensual decision-making was needed to minimize risk or that his ministry, charged with promoting Slovak industry, might not exercise due restraint.²⁰⁵

Government Action to Date

• Corrected a contradiction regarding the authority for licensing decisions and formalized the process of inter-ministerial review of license applications. As noted, the revised law declared the Ministry of Economy the ultimate decision-making authority and established that the various ministries will be consulted, with consensus required for approval of general trading licenses and the Ministry of Foreign Affairs exercising veto power in the case of individual arms export permits. The government later developed and formalized consultation procedures and established advisory bodies on licensing, but these procedures are not reflected in the arms trade law itself and the advisory bodies do not have statutory authority.

• Adopted legal changes to clarify arrangements for prolonging arms licenses.

• Reviewed license applications more carefully and rejected more licenses than in the past.²⁰⁶ Arms companies have made clear that they sense that criteria are stricter.²⁰⁷

Needed Reforms

• Rather than concentrate decision-making authority in one ministry and allow inter-agency consultation only through advisory bodies, establish a licensing body as an inter-agency body with statutory authority over arms licensing. Provide that all licenses be approved only where there is a consensus decision by the members of the licensing body, effectively granting veto power to each member of the body.

• Designate one ministry the implementing agency for licensing decisions made by the proposed inter-agency licensing body or, preferably, establish an independent agency with oversight responsibility over the arms trade.

• Ensure that the Slovak Information Service and the Customs Directorate are consulted regarding license applications.

Identifying and Closing Licensing Loopholes

Understanding the Problem

Slovakia’s governing arms trade law outlines a list of exceptions to licensing requirements. One such exception, discussed above, was in place until December 2001. The vaguely worded provision provided that “active improvement relations under conditional system or the passive improvement relations” was not subject to licensing.²⁰⁸ This applied to the repair and upgrading of military equipment.

It is not known to what extent this loophole was abused over the years, but it likely influenced the decision of arms traffickers to repair combat helicopters in Slovakia before exporting them to embargoed Liberia. Slovak authorities had been aware of the loophole for some time, and one former licensing official said that he repeatedly called for it to be closed.²⁰⁹ This was not done until the Liberia case drew particular attention to the loophole and gave urgency to the need for reform.²¹⁰

An additional, and crucial, loophole is addressed below. It permits weapons shipments that transit Slovakia to bypass licensing requirements, making Slovakia vulnerable to weapons smugglers who would funnel illegal arms shipments through Slovakia.

In other areas, the law does not clearly spell out licensing procedures, and these ambiguities suggest the possible existence of additional loopholes that unscrupulous arms dealers might seek to exploit. For example, the language describing license requirements leaves unclear whether licenses are required when the weapons are to be leased rather than permanently exported. In Moldova, U.N. investigators found that such a loophole was used to avoid scrutiny of an attempted illegal arms shipment to Liberia, in violation of the embargo. This would not be possible under Slovak law, a Ministry of Economy official stated in March 2003. Slovakia’s arms trade law does not directly address this issue of the temporary movements of weapons such as under leasing arrangements, he said, but any such movements are covered under the definition of import or export in Slovakia’s customs law—and are therefore subject to license requirements.²¹¹

Human Rights Watch also sought clarification about a new licensing exemption introduced in the package of legal changes adopted in mid-2002. It covers a category of “claimed military material” addressed under another law, without offering further explanation. The Ministry of Economy official confirmed that this provision relates to military equipment that is rejected by the purchaser and due to be returned to the supplier. In such cases a so-called complaints report is required to be submitted to customs authorities, who check it against the original customs documents for the goods.²¹²

Human Rights Watch did not have an opportunity to clarify the impact on licensing procedures of a further legal provision. It calls for advance notification to the Ministry of Economy of sales of surplus weapons from the military’s arsenal, suggesting that at least some Ministry of Defense surplus sales are not subject to full licensing procedures. The same provision allows a specific exemption for certain deliveries of surplus weapons to manufacturers, which also potentially could serve to undermine scrutiny of weapons exports.

Government Action to Date

• Passed emergency amendment in December 2001 to close the refurbishment and repair loophole. The change went into force in February 2002.

Needed Reforms

• Ensure that licensing requirements for surplus and re-exported weapons are on par with those applicable to newly produced weapons.

• Elaborate more clearly other exemptions, for example to emphasize that licensing requirements remain in place for any equipment that enters or leaves the country’s customs area, even if only on a temporary basis.

• Close the transit loophole (see discussion below).

Improving End-Use Controls

Understanding the Problem

Arms traffickers take advantage of lax enforcement to arrange weapons deliveries to unauthorized destinations. In Slovakia, controls designed to prevent diversion or re-export of weapons have historically been weak, and poorly enforced, a problem that has been acknowledged by some officials.²¹³ Several areas merit attention, and these relate to Slovakia’s role as an importer and as an exporter.

With respect to imports, the government has recognized that it must improve control over the issuance and use of Slovak end-user certificates. It was slow to arrive at this conclusion. For years, until February 2002, the Slovak Ministry of Economy office responsible for arms trade licenses routinely issued Slovak end-user certificates (also known as international import certificates) without first checking that the firm in question had sought and been granted an import license for the goods in question. The office also failed to perform checks to see if the firm to which it gave the EUC imported the weapons as planned. This laxity allowed for a situation ripe with potential for misuse: A firm could obtain a Slovak EUC, use it to acquire arms abroad, and then sell the weapons to a client in a third country instead. As explained by the official who took over the export control office and ended this practice, “It was sick. It was a kind of concealed re-export trade, under which if the arms ended up in another country than the one on the certificate [Slovakia], we would get all the blame. […] Whether the risk was worth it, given the often very questionable economic benefits for Slovakia is very, very dubitable.”²¹⁴

Slovakia’s lax EUC practices are at the heart of an alleged scheme in 1998 to illegally export a military radar system to North Korea.²¹⁵ In June 2003 Slovakia’s interior minister, Vladimir Palko, announced that criminal charges had been laid against “the former managing director of the Armex company [a Slovak arms firm], his subordinate, and the former director of the Office for Armaments, Equipment, and Material at the Defense Ministry.”²¹⁶ According to Palko, the accused arranged to buy the military equipment in Ukraine using a fraudulent Slovak EUC supplied by the military official (who also served on the Armex board at the time) and intended to deliver it to North Korea without a license (by registering it as for civilian use).²¹⁷ Referring to the misuse of a Slovak EUC Palko stated, “What they did is a grave sin in the arms business. When military material is exported, it must be clear who the military user will be; this is where they cheated.”²¹⁸ The former Armex director, who is also a former parliamentarian, denied the allegations in a television interview.²¹⁹

Other possibilities existed for mischief involving misuse of Slovak EUCs. The Ministry of Economy office responsible for arms trade licenses told Human Rights Watch that a firm with a Slovak EUC could import the weapons to Slovakia, send them to a repair plant to be repaired or refurbished, and then re-export them without authorization. There was, after all, no record that the weapons had been imported in the first place, and in any case a legal loophole, described above, exempted from licensing requirements weapons transfers under repair or upgrade contracts. While the loophole was still in place (until early 2002), a firm could thus re-export weapons from Slovakia to a third country without the knowledge or approval of either the original supplier or the Slovak government, contrary to the commitments contained in the end-user certificate.²²⁰

In the case of end-user controls with respect to direct exports from Slovakia, there are three areas of particular importance: evaluating end users, authenticating documents provided for arms deals, and carrying out post-shipment checks to make sure weapons arrive at their designated destination, rather than being delivered to an unauthorized client, and that they are not subsequently re-exported from the designated buyer. A fourth area involves the response to diversion when it happens, in particular cutting off arms trade ties with buyers that re-export weapons without authorization.

An example illustrates the last issue. In November 2000, assault rifles exported from Slovakia to Uganda for use in that country were supplied to Liberia when Uganda decided it no longer wanted them. An Egyptian arms broker reportedly agreed to return the weapons to Slovakia, as Uganda says it requested after determining they did not meet contract specifications. Instead, a consignment of 1,000 AK-47s was delivered to embargoed Liberia. A second shipment of 1,250 weapons of the same type was attempted, but not allowed to take place. The U.N. panel of experts on Liberia, which uncovered the case, implicated the Pecos company and Slovak arms dealer Peter Jusko in the scheme to re-export the weapons. They found that Pecos, one of the brokers for the deal, supplied a false EUC, that a Victor Bout associate signed for the cargo on behalf of Jusko, and that a Bout plane was used.²²¹

This case has received scant attention and numerous Slovak officials declined to discuss it, often stating that they were unfamiliar with it. Human Rights Watch was not able to establish whether the weapons, described as brand new and packed in crates, were manufactured in Slovakia, as stated in the U.N. report, or whether they had been obtained elsewhere and were re-exported by a Slovak company. Nor was any information made available about which company arranged the original, authorized contract to sell the arms to Uganda.

Ugandan authorities told the U.N. that they learned the first consignment left for “Guinea” only after the fact. In the case of the second shipment, they were aware that it was intended for re-export (they were presented with an EUC and flight plans declaring they were to go to Guinea) but halted the deal after developing doubts about the actual destination. Neither they nor Slovak officials have given any indication that Uganda at any point consulted the Slovak government regarding the possible re-export of the Slovak-supplied weapons, as would be required under standard end-user agreements. To the contrary, the available information suggests Ugandan authorities did not take into consideration their obligations to the exporter.

This is not surprising considering Uganda’s record with respect to the diversion of weapons declared for final end-use in Uganda. In 1999, for example, some 400 tons of weapons were flown from Bratislava’s airport, purportedly for delivery to Uganda, but the cargo allegedly was delivered instead to Sierra Leone rebels.²²² Moreover, Human Rights Watch has reported on the diversion of weapons from Uganda to rebel forces in Sudan.²²³ As noted elsewhere in this report, under the E.U. Code of Conduct and Organization for Security and Cooperation in Europe (OSCE) criteria, arms exporters agree to reject arms sales to countries from which they may be diverted or re-exported without permission. Uganda, moreover, would be disqualified under the E.U. and OSCE criteria on human rights grounds. Beyond its civil war and poor domestic human rights record, the country was at the time engaged in a regional conflict in the Democratic Republic of the Congo, where Ugandan forces were responsible for gross and widespread violations of international humanitarian law.²²⁴

A Slovak export license official, when asked about concerns regarding exports to Uganda, noted that he was aware that Uganda was considered a sensitive destination “for several reasons.”²²⁵ At least as of 2002, however, Slovakia had not excluded the possibility of trading arms with Uganda in the future.²²⁶ Official records show that Slovakia exported nine cannons and six multi-barreled rocket launchers to Uganda in 2002.²²⁷

Government Action to Date

• The legal reforms package adopted in July 2002 strengthen end-user controls. It maintains the requirement for an EUC or equivalent document, complete with a non re-export clause (as was previously the case), and further specifies that the document must be submitted in original and authenticated. In addition to pre-approval screening, the law also authorizes post-shipment verification of delivery.

• Licensing officials indicate that they are exercising more caution and checking arms deals more closely.

• In early 2002 a top customs official responsible for overseeing weapons investigations was given a seat on the government licensing committee. This move was intended in part to facilitate closer scrutiny of documentation by licensing officials.

• In September 2001 the Slovak government conducted a special audit of past arms deals to determine if any of its weapons might have been diverted to terrorist groups.²²⁸

Needed Reforms

• When considering license applications, take active steps to evaluate the risk of unauthorized diversion, including through re-export, and bar weapons supplies to countries that have a record of such diversion.

• Authenticate end-user documents, as permitted under the July 2002 law, and do so for each arms transaction.

• Once an arms export has been authorized, carry out follow-up checks to ensure that the weapons are not diverted, as also permitted under the law. These should include both verification of delivery and post-shipment checks to make sure the weapons have not been subsequently re-exported. Make such end-use monitoring a standard condition of arms transfers.

• Thoroughly investigate all cases of possible diversion of authorized arms deals. Block future arms deals to countries found to have violated agreements not to re-export weapons without permission, as well as those against whom there are credible allegations of weapons diversion.

Regulating Arms Trading Companies

Understanding the Problem

Slovak officials indicate that as of early 2002 there were more than one hundred registered arms trading firms, and that it was impossible for authorities to adequately check all of them. Some were described as “fly-by-night” firms likely set up to carry out only one or a very few deals.²²⁹ More established arms companies pushed for restrictions to be imposed to limit the number of firms. The idea, which would reduce competition and encourage consolidation, found support among law enforcement and licensing officials who argued it would be easier to control the activities of a smaller number of firms.²³⁰

Fly-by-night firms are not the only concern. Even well established firms have been accused of wrongdoing. In late January 2002 a Slovak company attempted to export ammunition production equipment without a license, officials said. The equipment, declared as shoe-making machinery, was destined for Myanmar (the former Burma), which is subject to an E.U. embargo. Officials who spoke to Human Rights Watch confirmed that the company, which was under criminal investigation, was an established arms trading company, UNIMPEX, as named in the media.²³¹ As of January 2003, the Slovak police had not filed criminal charges against anyone in connection with this case.²³²

Since 2001, Slovak authorities have been more proactive in investigating the companies suspected of illegal activity. As demonstrated in two of the case studies elaborated above, in recent cases, fines have been levied where authorities have determined that proper procedures were not followed but no crime had occurred. More serious measures against companies, such as the suspension and revocation of licenses are also available under Slovak law, but they have not been commonly employed against licensed arms trading companies who breach the law. After legal reforms in 2002 imposed tougher licensing requirements, the Ministry of Economy declined to allow twenty-five firms to renew their arms trading licenses.²³³

The concern has been expressed that Slovak criminal law impedes the criminal prosecution of companies for criminal wrongdoing, including in connection with illegal arms transactions. As in some other countries in the region, Slovakia’s legal framework establishes that criminal intent is required and has been interpreted as meaning that only individuals, not corporate entities, can be criminally liable.²³⁴ Moreover, the penal code apparently does not envision the crime of criminal negligence. The UNIMPEX and ARMEX cases may provide a measure of the seriousness of the Slovak government’s commitment to enforce rules on arms traders, both individuals and companies, as will also be discussed below.

Government Action to Date

• The arms trade law, as amended in mid-2002, imposes a minimum equity capital requirement of 5 million SKK (approximately $112,000) that has sharply reduced the number of licensed firms.²³⁵ Such measures were supported by police officials, who felt that they would help permit closer control.²³⁶

• The law also gives greater powers to investigators conducting background checks, and requires firms to provide further background information, including recent audits. The Slovak police department’s organized crime unit vets arms trading companies. Police officials indicated that, from October 2001 to April 2002, they had declined to recommend two companies, both times on the basis of suspicions of company links to organized crime.²³⁷

• Under the law, arms traders (both arms trading companies and arms brokers) are to be held legally responsible for complying with the conditions elaborated in the revised arms trade law, with reference to protecting Slovak foreign policy interests, its international obligations, and the interests of international organizations. Brokers (although not arms trading companies) also must refrain from engaging in arms trading that could contribute to terrorism or international organized crime.

Needed Reforms

• Strictly enforce arms trade regulations. Impose appropriate sanctions, including suspension or revocation of arms trade licenses, on companies that breach rules governing the activities of arms traders.

• Raise penalties for violations. These range considerably, depending on the violation, but begin with a fine of 10,000 SKK, roughly equivalent to $230, for refusing to allow an inspection by authorities. More serious violations, such as submitting false documents to export control authorities, may incur fines as low as 100,000 SKK or some $2,300.

• Revise legislative provisions to require annual review of arms licenses, the automatic revocation of licenses held by companies found to have engaged in illicit arms dealing, and annual government consultations with police and prosecutors regarding criminal investigations and prosecutions to ensure these stay on track toward trial.²³⁸

• Ensure that adequate criminal law provisions are in place to allow the prosecution of arms trading companies where circumstances warrant.

• Thoroughly investigate suspected criminal wrongdoing and prosecute violators.

• Correct discrepancies in the licensing criteria for arms trading companies, as compared to those applied to arms brokers.

Reining in Arms Intermediaries

Understanding the Problem

Private arms brokers and transport companies operating in Slovakia have been involved in arms transactions that raise serious concerns, either because the identified recipients were gross human rights abusers or because the weapons may have been diverted to unauthorized destinations. As the Liberia case clearly demonstrates, illicit arms traffickers need not operate in the shadows. To the contrary, weaknesses in supplier-country controls make it easy for them to obtain weapons for illegal destinations.

The previous activities of Joy Slovakia, and its successor Pecos, suggest the extent to which arms traffickers benefited from lax controls in Slovakia. The U.N. revealed that in 1997 the company entered into an arms deal with the Slovak military to export surplus Slovak small arms to Guinea. Guinea made no such purchase, and to date it remains unclear where the weapons actually wound up.²³⁹

The U.N. has reported that by that year Joy Slovakia was under investigation by law enforcement agencies of several countries on suspicion of involvement in weapons smuggling and money laundering.²⁴⁰ Senior Slovak officials who spoke to the Slovak media confirmed that Joy Slovakia and Peter Jusko, a Slovak national who was a director of the company and later of Pecos, were the subject of an Italian inquiry in 1997 and a Ukrainian investigation in April 1998, and that Slovak police took part in the investigations.²⁴¹ Slovak police said they did not gather sufficient evidence for prosecution.²⁴² The company remained active in the arms trade until at least 1998.²⁴³

Arrangements in which a broker in Country A organizes a deal involving the export of weapons from Country B to Country C are known as third-party brokering. They give brokers an added measure of protection for their activities, as few countries regulate arms trade activities of their nationals or companies when the deals take place outside national territory. Joy Slovakia is known to have utilized such triangulation. A separate U.N. investigation uncovered two 1998 arms flights carrying weapons purchased by Joy Slovakia in Moldova. The documents provided to authorities said the weapons were for Guinea, but the cargo was diverted to another party using the air transport services of Victor Bout. The U.N. suggested they might have gone to the National Union for the Total Independence of Angola (UNITA), at the time an embargoed rebel group in Angola.²⁴⁴

Media reports have linked Joy Slovakia to arms transactions involving Croatia, the Republic of Congo (Congo-Brazzaville), Russia (Chechnya), and Uganda.²⁴⁵ Moreover, Joy Slovakia was featured as part of a Ukrainian investigation into the alleged illegal recruitment in Ukraine of mercenaries to fight in conflicts in Africa.²⁴⁶ The company also had links to Western Europe. Italy was among the first countries to investigate the company, as noted, and in 1999 the French parliament heard testimony on Joy Slovakia’s alleged ties to the French far right and to a Belgian mercenary.²⁴⁷

Other information about Joy Slovakia came to light once the U.N. Liberia report drew attention to the company. For example, a former Slovak licensing official told Human Rights Watch that the name of Joy Slovakia had come up in connection with attempted arms deals, in which people associated with Joy Slovakia had tried to broker arms transactions via other companies.²⁴⁸ Moreover, under the government elected in 1998, Pecos, the company established in Guinea by some of the partners in Joy Slovakia (see above), made at least one attempt to secure an export license, according to a source close to Slovak arms export control authorities. In 2000, licensing officials received a request from Pecos for an export license to sell 5,000 submachine guns to a South American country, the source said, but rejected it after an inspection revealed that the deal was fraudulent.²⁴⁹ Slovak officials reportedly received a warning from the United States about the company in mid-2000, at about the time the LOT deal was arranged.²⁵⁰ Yet, despite all that was known about the company and the persons associated with it, no one stood in the way of the Pecos operation to illegally export weapons repaired in Slovakia.²⁵¹

Government Action to Date

• Legal reforms adopted in July 2002 impose brokering controls for the first time. The law provides that only Slovak individuals and companies can act as arms brokers and subjects them to the same two-tiered licensing system as has been applied to arms trading companies.

• These brokering controls are intended to apply to arms deals carried out by Slovak arms brokers, even where the weapons do not pass through the territory of Slovakia. Such extraterritoriality provisions represent “best practice” among countries that have instituted brokering controls.

Needed Reforms

This revised law provides a new tool to control the activities of arms brokers, and therefore marks progress, but it is imperfect in important respects. Weaknesses in the legislation should be corrected through further legal changes, in particular:

• The definition of brokering activity should be clarified and, if necessary, expanded. As adopted in July 2002, it covers intermediary activities. A translation of the revised law provided by the Ministry of Economy indicates that “mediating” (brokering) activity is “an activity of the mediator directed to a foreign party interested to have the possibility of entering with a third party into a contract covering the production, acquirement [sic], or sale of military material including activities and services allowing therefore [sic].” Some arms intermediaries, most prominently transport agents and financiers, do not necessarily “mediate” a “contract” between a buyer and seller (“foreign party” and “third party”) and would thus appear to be excluded from this definition. Brokering laws passed in several countries, including Belgium, cover the activities of these other actors.

• Controls should be extended to the activities of foreign arms brokers with respect to arms transactions in Slovakia. A provision disqualifying foreigners from obtaining brokering licenses is likely to result in foreign brokers partnering with a Slovak national to comply with the law, while permitting foreign brokers to avoid the same scrutiny. (Such an approach was employed, for example, by foreign arms dealers who provided arms to Angola via a Slovak company in the first half of the 1990s in what later erupted in France into an arms-for-oil and corruption scandal known as “Angolagate.”) Bulgaria is among the countries whose brokering rules cover foreign nationals active on its territory.

• Extraterritorial controls on Slovak arms dealers should be further elaborated, as the July 2002 change imposing such controls left unclear how they are to be implemented in practice. One model is provided by the United States, which has had extraterritorial brokering controls in place since 1996.²⁵²

Controlling Weapons Transshipment

Understanding the Problem

In Slovakia, weapons transshipment (that is, the movement of weapons originating in one country through Slovak territory for delivery to a third country) is not subject to licensing. Under a legal exemption included in the 1998 law and left in place following revisions to the law in 2002, no license is required for the transit of military equipment through Slovakia if the equipment is on the territory of the Slovak Republic for a period no longer than seven days. As pointed out by a licensing official, there would be no reason for any transit across Slovakia to take more than seven days, so this exemption effectively covers all weapons transit.²⁵³ In fact, he confirmed, no license is issued for weapons transit in Slovakia.²⁵⁴ Another official agreed that the reference to a seven-day time period was irrelevant and described it as a drafting error in the original legislation that remained uncorrected.²⁵⁵

This loophole takes on added significance when one considers that Slovakia, and the airport in Bratislava in particular, has been a hub for arms shipments. The country has been a point of origin or transit for arms deliveries to human rights abusers and countries in conflict, as well as to suspected illegal destinations. Slovak transport agents have been involved in arranging some of these deliveries. Given that there are no licensing requirements for such transactions, arms shipments through Slovakia are subject only to civil aviation and customs controls. Customs and airport personnel are not able to check every shipment, and these controls have been insufficient to deter and detect suspicious activity. Slovakia’s intelligence body, the SIS, reported in May 2002 that the country continued to serve as a transshipment point for illegal arms flows to areas of violent conflict, noting among other concerns that “Slovakia became, due to imperfect legislation, a transport corridor for illegal deliveries of weapons and a country where illegal deals were legalized.”²⁵⁶ In its 2003 report, the SIS said it found that some Slovak companies were in contact with international arms trafficker Victor Bout.²⁵⁷

The September 2001 shipment of Iranian weapons seized at Bratislava airport, described in this report, provides one example to highlight Slovakia’s longstanding role as a transit point for troubling weapons shipments. Other examples include the following:

• From 1993 until a scandal arose in 1999 a Czech company, Agroplast, allegedly used the Bratislava airport for illegal arms transports.²⁵⁸ The company reportedly disguised its activities by changing the registration information of the planes it used,²⁵⁹ and there was speculation that Bratislava airport officials may have participated in the fraud.²⁶⁰ Agroplast was also linked to arms flights via Bratislava to Croatia (then subject to an embargo) and the UAE in the early 1990s, with some twenty arms flights via Bratislava attributed to the company in the fall of 1993.²⁶¹ Attention focused on the company in 1999, when it was at the center of the alleged sale of surplus Kazakh fighter planes to North Korea in 1999, for which two officers of the company were charged in the Czech Republic.²⁶²

• Bratislava airport was used for a series of flights in 1995-1996 delivering weapons to Kabul, Afghanistan, with the value of the arms exports reportedly reaching 62 million SKK (more than $2 million at the time).²⁶³ Human Rights Watch obtained documents for a series of flights to Kabul, Afghanistan, in June 1996 carried by a British company, Sky Air Cargo, and Cyprus-based Avistar Airlines on planes chartered by Slovak Air Services,²⁶⁴ itself owned by Czech Airlines.²⁶⁵ Flight documents show that Avistar’s Boeing 707 (registration 5B-DAZ) flew from Bratislava via Ashgabat, Turkmenistan, to Kabul on June 15, 18, and 19, 1996.²⁶⁶ A Sky Air Cargo Boeing 707 (registration EL-JNS) departed Bratislava on June 16, 17, and 18, 1996, traveling to Kabul via Mashhad, Iran.²⁶⁷ The air waybill for the flight conducted on June 17, 1996, indicates that the cargo consisted of “defense material.”²⁶⁸ A source familiar with the case confirmed that this was one of several Slovak Air Service-chartered flights that carried arms to Afghanistan during that period.²⁶⁹ These flights occurred at a time of heavy fighting in Afghanistan, involving serious violations of human rights by all parties to the conflict.

• A plane leased by Avistar Airlines used Bratislava airport for numerous weapons shipments from December 1998 to February 1999.²⁷⁰ The flights ended after the aircraft crashed on take-off from Bratislava airport in February 1999, reportedly when attempting another arms delivery.²⁷¹ Investigative journalists, citing flight documents and interviews with crewmembers, reported that these weapons shipments were destined for Sudan.²⁷² Similarly, a retired airport official reportedly indicated that the aircraft had forty-two tons of ammunition on board when it crashed.²⁷³ The Slovak company that sold the weapons delivered to Afghanistan, Hermes, has stated the arms were authorized for export to Chad and it has no reason to believe they were diverted.²⁷⁴ Slovak officials have made similar statements.²⁷⁵ The wife of the owner of the transport company denied any wrongdoing by the company and said she was not in a position to verify the plane’s final destination.²⁷⁶ Sudan, whose long running civil war has been marked by gross and widespread abuses, has been under an E.U. embargo since 1994.

• In March 2000, a plane left Bratislava’s airport bound for Harare, Zimbabwe, allegedly carrying a misdeclared weapons cargo for use by Zimbabwean forces in the war in the Democratic Republic of Congo.²⁷⁷

When the Slovak government proposed arms trade reforms in April 2002, many observers expected that the licensing exemption for weapons transit would be removed, and statements by officials at times endorsed this view. In the end, however, consensus on such a measure could not be reached, and a more modest measure to grant customs greater powers was endorsed instead.

Slovak officials, faced with criticism for taking only a half-measure and leaving the transit loophole in place, have argued that the country’s customs and civil aviation controls on weapons transit are sufficient to prevent illicit arms trafficking, and that transit licenses are not used in other countries in the region.²⁷⁸ It is true that some countries fail to adequately control weapons transit, and therefore make themselves that much more vulnerable to illicit arms trafficking, but other countries, including Poland and Bulgaria, require that weapons transshipment be licensed. Such controls are increasingly being seen, including within the European Union, as a required international standard to ensure reliable arms trade control.²⁷⁹ This is particularly true for countries that geographic location and other factors have made regional arms transport hubs.

Government Action to Date

• In June 2001, a specialized customs unit, known as Section 11, was formed to prevent smuggling of weapons and other hazardous materials, as well as drugs. Previously the unit was responsible for interdicting drug shipments.

• The July 2002 amendments to the arms trade law granted to customs officials explicit authority to detain, send back, or impound any suspicious shipment.

Needed Reforms

• Adopt legislative reforms making transit subject to arms licensing.

• Proactively monitor air cargo movements for weapons shipments. For example, maintain a list of transport operators and planes linked to illegal arms deliveries or suspected illicit trafficking and check all planes against that list.

• Thoroughly investigate suspicious cases, including those from the past, and prosecute violators.

• Investigate published claims that civil aviation and airport personnel have permitted illegal activity at the Bratislava airport.

Enforcing Arms Embargoes

Understanding the Problem

Slovakia states that it observes the arms embargoes established by the United Nations and the European Union. The mechanisms to give such embargoes teeth, however, are minimal. Officials say that they crosscheck any arms export license applications against the list of countries subject to sanctions, such as those imposed by the U.N., E.U., or the OSCE, and that they refuse any license application that lists one of those countries as the destination.

A Slovak licensing official stated that until the adoption in mid-2002 of a new sanctions law, these embargoes were not automatically implemented in domestic law.²⁸⁰ Therefore those who are suspected of violating international embargoes before the entry into force of the sanctions law, in September 2002, cannot be prosecuted for that crime. Instead, they would be subject to Slovak criminal law on the contravention of regulations concerning “the handling of controlled goods requiring special handling.” This law provides for a modest sentence of up to three years, or eight years for the most serious cases.²⁸¹

Looking to Slovakia’s past experience, the government has not always reacted firmly to allegations of arms embargo violations. Until the Jusko case was opened in 2001, suspected illegal arms sales activity had not resulted in a criminal prosecution, except in cases of small-scale domestic and cross-border smuggling. Two recent cases—that of an alleged attempt to smuggle weapons production equipment to Myanmar and that of actual and attempted illegal arms exports to Liberia—suggest that embargo enforcement has begun to receive greater attention, at least at the level of initiating investigations. These cases, and the seriousness with which they are pursued, will provide important tests of Slovakia’s commitment to fully enforce arms embargoes and punish violators.

The government must also overcome obstacles to carrying out solid criminal investigations. Law enforcement officials, speaking in connection with the cases documented in this report, pointed to a series of challenges they faced as they set out to combat arms trafficking. They indicated that cumbersome criminal procedures in Slovakia tended to slow down their investigations.²⁸² They also complained that, quite often, different agencies did not share intelligence data and other information on suspected illicit arms traffickers, nor did foreign governments. International cooperation to investigate suspected traffickers was another source of frustration and delay in their investigations. Further areas for improvement were identified with respect to the need to dedicate sufficient resources, including personnel, to law enforcement efforts related to the weapons trade and to continue to enhance law enforcement capacity in this area, including by working in partnership with foreign law enforcement agencies.

Government Action to Date

• Slovak authorities have opened criminal investigations related to embargo violations in two cases, in 2001 and 2002, and, as of early 2003, had pressed charges in the former case.

• Sanctions legislation was adopted in mid-2002, giving arms embargoes legal force. The government issued a decree listing destinations under embargo and empowered the Ministry of Foreign Affairs to update that list.²⁸³

Needed Reforms

• Declare the prevention and punishment of illicit arms trafficking a political priority, and act accordingly.

• Enhance the ability of law enforcement personnel to carry out solid investigations with a view toward prosecution. In particular, improve coordination between different law enforcement agencies, continue to develop the capacity of investigators to pursue arms trafficking cases, and dedicate sufficient personnel to arms cases when they arise.

• Share intelligence data on suspected illicit arms traffickers, both within the Slovak government and among international partners.

• Investigate past cases of arms transfers alleged to have violated embargoes.

Implementing Arms Export Criteria

Understanding the Problem

Slovakia has committed to apply certain minimum criteria to all arms export decisions. The national arms trade law states that the government will not approve arms deals that harm Slovakia’s interests, violate Slovakia’s international obligations, or damage the interests of international organizations. The law also states that the Slovak government fully observes embargoes, and automatically refuses any arms deal that would violate an international arms embargo. Slovakia also has undertaken international commitments with respect to arms export controls. As a member the Wassenaar Arrangement, a multilateral export control regime, Slovakia has agreed to exercise maximum restraint in its arms exports and to reject arms deals to destinations agreed to be particularly sensitive, including to certain conflict zones. Moreover, it has promised to uphold minimum agreed upon standards when evaluating arms exports. These are elaborated in the 1998 E.U. Code of Conduct on Arms Exports, which Slovakia signed on to as an E.U. associated country, and the OSCE criteria governing arms exports, first adopted in 1993 and reaffirmed in a November 2000 agreement.²⁸⁴

Under these agreements, Slovakia has agreed to bar arms exports under certain circumstances, including if the weapons are destined to human rights abusers, areas of violent conflict or regional instability, countries experiencing internal armed conflict or tensions, or recipients who may divert the weapons to unauthorized users. For example, the E.U. Code of Conduct lists eight criteria and elaborates further that arms exports should not be approved if the transfer in question would:

• Violate U.N., E.U., or OSCE embargoes or other international obligations, including arms control treaties.

• Risk being used for internal repression, where adherents to the E.U. Code of Conduct agree to weigh in particular the record of the recipient country with respect to serious violations of human rights.

• Provoke or prolong armed conflicts or aggravate existing tensions or conflicts.

• Threaten regional peace, security, and stability.

• Threaten the national security of E.U. countries or their allies.

• Be supplied to a country that violates international humanitarian law or supports or encourages terrorism and international organized crime.

• Present a risk that the equipment being transferred would be diverted within the buyer country or re-exported under undesirable conditions.

• Seriously hamper the sustainable development of the recipient country.

Despite these pledges, Slovakia has approved arms sales in recent years to countries including Angola, Azerbaijan, India, Indonesia, Sri Lanka, Turkey, Uganda, and Zimbabwe, each of which fall within the criteria listed above.²⁸⁵ According to one press account, Slovak Ministry of Economy statistics show that in 2002 Slovakia exported to Syria 1.5 million SKK (approximately $37,500) worth of equipment classified as “bombs, grenades, torpedoes, guided missiles, and similar military equipment” in the face of serious allegations that weapons deliveries to Syria have been diverted illegally to Iraq.²⁸⁶ In early 2003, during an official visit to Slovakia by the Chinese premier, the possibility of weapons sales to China was discussed.²⁸⁷ China has been under a European Union arms embargo since 1989.

Slovakia has yet to effectively implement agreed upon minimum export criteria. The government maintains that it respects and takes into account the principles of the E.U. Code when licensing decisions are made. Slovak officials, however, readily acknowledge that human rights have been a low priority when evaluating arms export authorization requests and that humanitarian considerations often lose out when weighed against other interests. An official who served on the government licensing commission for three years in the late 1990s and early 2000s as the representative of the Ministry of Foreign Affairs spoke candidly of Slovakia’s arms export decision-making as an exercise in balancing risks against rewards. He said: “If there is a very great commercial interest, we can take some foreign policy risk.”²⁸⁸ Other Slovak officials defended weapons sales to Angola and other dubious clients, arguing (contrary to the provisions of the E.U. Code) that Slovakia was entitled to engage in the arms trade with any country so long as no explicit international prohibition on arms trading with that country had been imposed.²⁸⁹

The government nonetheless has taken some steps that offer the possibility that Slovakia will improve adherence to international export criteria.

Government Action to Date

• The arms law, as amended in July 2002, gives greater emphasis to international obligations, although without clearly implementing otherwise nonbinding commitments.

• Under the revised law, traders and brokers are to refrain from any deals that would harm Slovakia’s interests, violate Slovakia’s international obligations, or damage the interests of international organizations. It remains unclear, however, how the government intends to apply this provision and hold individual brokers and traders accountable if they do not comply with it. Regulations to accompany the law have been approved, but these were not made available in time for Human Rights Watch to review them for this report.

• In 2001 the Ministry of Foreign Affairs circulated a document informing government officials about the E.U. Code of Conduct and explaining how it was implemented in other countries, and offered some reflections on its implementation in Slovakia.²⁹⁰

Needed Reforms

• Explicitly incorporate human rights and international humanitarian law criteria into national arms trade law and make them binding on the government as well as on private actors. By doing so Slovakia would build on existing “best practice” in countries such as Poland and Bulgaria that hold private actors accountable for meeting certain export criteria and would be at the forefront of developing nationally binding codes of conduct. The Belgian parliament, for example, incorporated minimum export criteria into national law in 2003 and thus made them binding.

• Improve human rights knowledge of licensing officials, and ensure that they undertake proactive checks on all prospective arms clients against established minimum criteria.

Disposing Responsibly of Surplus Weapons

Understanding the Problem

The markets for Slovakia’s surplus weapons are in war-torn countries in Africa and elsewhere that can afford little else. These weapons are more likely to be used by undisciplined government forces, as well as by rebel groups. Some modest international initiatives seek to address the ongoing cascade of surplus weapons to the world’s conflict zones by reducing the quantities of such weapons available for sale. NATO and its Partnership for Peace program, for example, have made funds available for the destruction of surplus small arms, as have individual donor countries, but Slovakia at this writing was not known to have taken advantage of such programs.²⁹¹ Slovakia, along with other OSCE countries, has agreed in principle to destroy, rather than sell, its cast-off small arms.²⁹²

Such promises, however, remain to be implemented and, in any case, do not extend to heavy conventional weapons. They also fly in the face of tradition and current practice. Sales of surplus weapons comprise a significant portion of Slovakia’s foreign trade in arms. In 2000, for example, nearly two-thirds of all arms exports were surplus weapons, as opposed to new production.²⁹³

Many more surplus weapons are expected to come onto the market as Slovakia institutes military reforms that will considerably reduce the size of its forces. By 2010 Slovakia plans to reduce its forces by 21,000 troops, and the country will seek to shed heavy equipment in favor of lighter military equipment that can be more rapidly deployed.²⁹⁴ Official information on Slovakia’s military holdings, when compared to its planned force structure for 2010, reveal the scale of weapons that could potentially be dumped onto the market place: In 2002 the Slovak armed forces had 271 battle tanks in their arsenal, and by 2010 this number was expected to be reduced to 52; the 524 armored combat vehicles held in 2002 were to be brought down to 164 by 2010.²⁹⁵

The Slovak military has made clear that it intends to use revenue from the sale of unneeded weapons to finance its modernization.²⁹⁶ The financial incentive to sell surplus weapons is strong. According to a 2001 estimate, the destruction of surplus battle tanks reportedly costs approximately 100,000 SKK (some $2000) per unit in Slovakia. Surplus tanks sold to Angola, on the other hand, were said to have earned some 700,000 SKK (approximately $15,000) a piece.²⁹⁷ A senior MOD official said Slovakia was able to sell only a few of the more than twenty surplus MiG-21 fighter planes it had on offer in the late 1990s, and that the cost of dismantling the rest was 150,000 SKK (approximately $3000) per unit.²⁹⁸ Selling the weapons not only spares the government the added expense of storage or destruction, it also earns income for the government. In the first half of 2000, the Slovak MOD reportedly added 73 million SKK (more than $1. 5 million) to its budget from the sale of surplus aircraft and tanks.²⁹⁹

Pressures to make the sale are such that the government often intervenes to market the surplus wares of its military.³⁰⁰ Slovakia has found a market niche as a re-exporter of surplus weapons from other countries.³⁰¹ According to official data, from 1999 through the end of 2002 Slovakia sold Angola 205 battle tanks, thirty-eight large-caliber artillery systems, and twenty-five combat planes. Most were direct exports of surplus weapons from Slovak stocks, but a considerable number were re-exports by Slovak companies of weapons from the arsenals of Bulgaria and the Czech Republic.³⁰²

Government Action to Date

• Agreed to the November 2000 OSCE small arms agreement, which included important commitments regarding the responsible disposal of surplus weapons.

Needed Reforms

• The Slovak government should suspend sales of surplus weapons from its arsenal, and the authorization for re-exports of surplus weapons from other countries, until strict export criteria in keeping with the provisions of the OSCE agreement are enacted into law.

• Rules governing the trade in surplus weapons should be clearly delineated in arms trade legislation and implementing regulations, and should be fully applied to all categories of weapons, including sales of surplus small arms and heavy weapons.

• Slovak authorities should secure arms stockpiles and seized weapons to prevent them from being stolen or sold off to unaccountable forces and also ensure accountability for violations.

Combating Corruption and Conflicts of Interest

Understanding the Problem

Widespread corruption in Slovakia, which has seen a number of high-level scandals, may infect the country’s arms trade as well. A diplomat told Human Rights Watch that corruption was among the main concerns with respect to arms export controls.³⁰³ Customs officials acknowledged that corruption is to be expected in the arms trade, and admitted that it was possible that customs officers were among those who might accept financial inducement to look the other way when they came across a suspect arms deal.³⁰⁴

Other bodies responsible for controlling arms transfers have also been accused of corrupt practices and other abuses of authority. In late 2002 attention focused on serious allegations, published in the British journal Jane’s Intelligence Digest, that Slovakia’s intelligence service (SIS) has itself participated in illicit arms deals, among other troubling activities.³⁰⁵ The allegations sparked concern internationally, including at NATO headquarters,³⁰⁶ and domestically, where they prompted a parliamentary hearing.³⁰⁷ Some government officials suggested there could be a measure of truth to the claims of SIS misdeeds.³⁰⁸ In addition, Slovak arms dealer Peter Jusko said the allegations in Jane’s concerning involvement of the SIS in illegal arms deals were true.³⁰⁹ The SIS director, however, adamantly rejected the allegations and attributed them to “lobbyist circles” composed of people engaged in illegal arms trading in Slovakia.³¹⁰ The scandal and mounting public criticism of the SIS appears to have contributed to his decision, in March 2003, to resign from his post.³¹¹

Another area of particular concern relates to licensing decisions. Slovak authorities in 2002 opened an investigation into corruption allegations involving a staff member of the licensing body, in connection with the September 2001 export to Angola of fighter aircraft, described above.³¹² Customs officials declined to provide details about the case, but noted that licensing procedures “naturally” provide opportunities for corruption.³¹³

Some attention has been given to potential conflicts of interest among licensing officials. National law has provided at least since 1998 that licensing officials cannot accept employment in the defense industry for one year after leaving their responsibilities, but it does not prevent sitting government officials from simultaneously serving on the boards of arms companies. The Slovak media, as noted above, drew attention to such conflicts, creating pressure for change.³¹⁴

The conflicts of interest were not limited to licensing officials. Human Rights Watch also learned that the person who, until October 2001, headed the Ministry of Defense office responsible for disposal of surplus arms, as well as MOD procurement, sat on the board of a state-owned arms company. Again, this was viewed at the time as a mechanism to secure greater control over state-owned arms firms, but in fact opened the door to the opposite—the potential for corruption and permissiveness.³¹⁵ As noted above, charges were laid in 2003 against the former head of that MOD office who, while also serving on the board of an arms company, allegedly supplied a fraudulent Slovak EUC used by the company in an illegal transaction. In July 2003, a former minister was among those charged with fraud and abuse of power in connection with the alleged embezzlement of millions of dollars from a state-owned arms firm.³¹⁶

More broadly, some concerns have arisen about the procedures for making surplus military stocks available for sale, and whether these are sufficient to ensure transparency and prevent corruption. Media sources have suggested that certain companies may be favored for those contracts.³¹⁷ The Ministry of Defense, rejecting such allegations, maintains that all equipment is supplied in transparent open tenders and is subject to a full review process.³¹⁸

Concerns about potential conflicts of interest also have arisen with respect to institutional arrangements. In two ministries, responsibility over arms export decisions was placed in the hands of government departments dedicated to promoting such exports. Until early 2002, the section within the Ministry of Economy that acted as the secretariat to the licensing committee and processed arms export licenses was the same section responsible for promoting the interests of the arms industry, and this situation had persisted for years.³¹⁹

A parallel situation existed at the Ministry of Defense, where the section responsible for selling off surplus weapons was established as an independent entity within the ministry. The unit was brought under greater institutional control with a major reorganization in late 2001, when it was re-established under the modernization section of the ministry.³²⁰ In both cases, institutional conflicts of interest were compounded by personal conflicts of interest, as the offices where headed by persons who simultaneously served on arms company boards.³²¹

Government Action to Date

• The Slovak arms licensing commission was disbanded in early 2002 and reconstituted to eliminate conflicts of interest among its members.

• Reorganizations at the Ministry of Economy and Ministry of Defense resulted in the removal of blatant conflicts of interest and helped ensure greater institutional control over arms export decision-making.

• Human Rights Watch was informed that legislation adopted in 2002 bars government officials from serving on any company boards.³²² A Slovak arms expert said that further action was needed to clearly apply such rules to state-owned companies (as well as private ones) and to officials responsible for controlling arms transfers.³²³

Needed Reforms

• Ensure that new rules barring government officials from serving on the boards of companies are comprehensive and that they are widely disseminated and strictly enforced.

• Raise the standards by which arms trade officials are prohibited from assuming positions in the arms industry from one year to at least three years after ending their regulatory responsibilities.

Ensuring Transparency and Securing Parliamentary Oversight

Understanding the Problem

While transparency is on the rise in much of Western Europe and parts of Central and Eastern Europe, with many countries preparing and making public annual reports that provide (to different degrees) information on arms exports, to date Slovakia has not participated in this trend. It has not published an annual arms export report and at this writing had no concrete plans to do so.

Slovakia reports to the U.N. Register of Conventional Arms, a voluntary transparency mechanism. The U.N. register, which is published annually, covers only seven categories of heavy weapons and excludes small arms. Moreover, the nature of the information requested by the U.N. is limited, representing a fraction of what is covered in the more complete national reports prepared by many countries. Slovakia also participates in information-sharing mechanisms through the Wassenaar Arrangement and the OSCE, but to date these have not been made public.

To the contrary, the Slovak government has strictly limited the arms trade information it makes available. It has issued annual press statements summarizing arms trade activity for the year in very general terms. Because much of Slovakia’s authorized arms trade goes unreported, it is hard to measure compliance with agreed international norms. Secrecy laws, revamped in 2001, had the effect of further closing off arms data.³²⁴

An initiative by the non-governmental Slovak Foreign Policy Association (SFPA), carried out in cooperation with a U.K.-based international nongovernmental organization, Saferworld, led to the first-ever independent report on Slovakia’s arms trade as part of a broader civil society effort to open up dialogue about arms trade topics in the country. The SFPA report outlines the history of the Slovak arms industry and the controls regulating the foreign trade in weapons, including secrecy provisions, and provides information on exports of heavy conventional weapons.³²⁵

The government has offered different rationales for its reluctance to share arms export data. Ministry of Economy spokesman Peter Chalmovsky was reported to have said, “By informing of arms deals we do harm to ourselves. If we do not export, all the others will gladly export (arms).”³²⁶ Similarly, the director of the defense industry section of the Ministry of Economy, who had also served as an arms export licensing official, said that annual arms trade reports could not be prepared because it is not allowed by the law on secrecy, and parliamentary action would be required.³²⁷ Barring that constraint, he stated that he had no objection to preparing reports, as is the practice in several E.U. countries.³²⁸ The Ministry of Foreign Affairs maintained a similar attitude, stating that it was open to increasing transparency—at some indeterminate point in the future, perhaps not until Slovakia became a member of the European Union—but that some adjustment to secrecy rules would be required to make that possible.³²⁹

With respect to parliamentary oversight, Slovakia’s parliament does not play a role in overseeing arms export decision making. Under the current system, the Ministry of Economy is the ultimate authority on arms trade decisions. It does not report to parliament which arms exports it approves, nor does it have a mechanism for informing parliament in advance of pending deals to allow for their review. Parliament, therefore, is not able to act as an effective check on the executive branch in the arms trade sphere.

Government Action to Date

• Slovakia reports annually to the U.N. conventional arms register, covering seven categories of heavy weapons.

• The government takes part in information exchanges with other governments about arms transactions, although to date it has not shared that information publicly.

Needed Reforms

• Repeal secrecy rules that prohibit the sharing of arms trade data.

• Prepare and make public a detailed annual report on arms transfers.

• Provide for parliamentary scrutiny of arms deals, including advance notice of pending arms deals and the opportunity to review export records.