Austria

Researcher4187: The disposal of army assets – in recent years this primarily concerns real estate and old cars – is generally announced in advance online. Details about sales are not released pro-actively, in cases of larger sales local media provides coverage with some details on the sale. It is difficult to assess how internal control procedures work regarding various types of asset disposals.

A member of Parliament (Interviewee 1) stated that the defence committee receives updates on larger privatization processes and that asset disposals are generally more transparent than procurement projects. The MP also stated that the committee is provided with information on asset sales upon request by the minister. This suggests that some oversight is exercised by Parliament.

Real-estate privatizations are largely carried out by SIVBEG, a company owned by the ministry of defence and sports. SIVBEG has land plots for sale on its website, usually including asking prices, but does not disclose details on the sales processes. A 2010 report by the Court of Audit of SIVBEG highlighted a number of shortcomings regarding SIVBEG and its internal controls, including the fact that it had been set up despite the fact that the government already has a real estate privatization entity, BIG, that had expertise SIVBEG did not have. Among other things, the Court criticized the lack of a database to document the stages of different sales processes, concluding that because of insufficient documentation internal controlling was not possible. A 2013 follow-up report found that documentation was improved and that the Court's recommendations had been partly implemented, but some criticism remained, including that the company had not always followed EU-Commission guidelines in regards to the public advertisement of real-estate that was for sale.

The Court of Audit also produces annual audited accounts of the federal government, which includes aggregations on the income and expenditure of the ministry of defence (these usually don't include information with a granularity that woudl allow to derive the income generated by individuals sales). All reports of the Court of Audit are accessible online.

Any sale and export of arms is regulated by the War Materials Act. However, there is also no pro-active, timely and detailed publication of imports and exports conducted under the War Materials Act available.

There have been numerous media reports on several major asset disposal efforts in recent years, which often also provided aggregate numbers on the sales prices. In one case, SIVBEG sold property through the popular Austrian bidding website Willhaben.at. However, there appears to be no ministry of defence policy of proactively publishing the financial results of all disposed assets.

In April 2014, the Anti-Corruption Prosecutor's office finished its investigations against former defence minister Norbert Darabos related to allegations that while Darabos was in office, the ministry of defence had sold property to companies with ties to Darabos' Social Democratic Party. The prosceutors' report was submitted to the Ministry of Justice (which has the final say on whether such a case should be submitted to court). At the time the investigations were opened, the ministry claimed the accusations (triggered by a whistleblower) were an attempt by the opposition to discredit the minister. By June 2015, was no news reporting on whether any decision on this case has been taken.

There is scrutiny over asset disposals through the Court of Audit and Parliament, though there may be shortcomings in the strength of these controls. There is no or only highly abbreviated public information on the outcome of asset disposals.

Response to reviewer: Insufficient evidence to increase score. Since the last assessment, there was a court of audit follow-up report on SIVBEG privatizations of real estate, and investigations against a former defence minister, which were pursued by prosecutors. There has also been an increase in asset disposal processes in recent years, highlighting that there is no proactive publication of financial revenue generated by these sales.

Researcher4187: The Ministry of Defence and Sport's Internal Audit Group (Gruppe Revision) is responsible for the internal scrutiny of asset disposals. The internal auditors are accountable to the Minister for Defence; their internal independence could not be appropriately assessed as none of their reports and findings have ever been published.

A spokesperson of the anti-corruption prosecutor's office (Interviewee 2) stated that the Ministry of Defence had forwarded several cases with indications of corruption to prosecutors and that in these cases, their co-operation with the ministry's Internal Audit Group was &quoute;flawless&quoute;.

Parliament on a number of occasions has taken action in recent years to scrutinize the disposals of assets by directing written questions to the Minister for Defence, who then has to respond in writing. These questions and answers are both publicly accessible through the Parliament's website. Members of the Parliament's National Defence Committee have also used their right to request details and updates on asset disposals, but such details are usually not pro-actively made accessible to the public.

A member of Parliament (Interviewee 1) stated that the defence committee receives updates on larger privatization processes and that asset disposals are generally more transparent than procurement projects. The MP also stated that the committee is provided with information on asset sales upon request by the minister. This suggests that some oversight is exercised by Parliament. However, the committee hearings and any debates taking place there are not accessible to the public.

Occasional scrutiny is also provided by the Court of Audit, which in 2010 looked at real-estate privatizations of the Ministry of Defence, carried out through its SIVBEG subsidiary, and issued a follow-up report in 2013 – both reports are available online. The Court of Audit's independence is protected by Articles 122 to 126a of the Constitution.

The Court of Audit also produces annual audited accounts of the federal government, which includes aggregations on the income and expenditure of the ministry of defence (these usually don't include information with a granularity that would allow to derive the income generated by individuals sales). All reports of the Court of Audit are accessible online.

The available evidence suggests that there is independent scrutiny of asset disposals conducted by defence establishments. However, the reports of such scrutiny are not publicly available, with exception of those produced by the Court of Audit.

Response to reviewer: I also revised the score to 3 because there is enough evidence to suggest that there is independent scrutiny, although the results are not transparent.

Researcher4187: The secrecy provision in the Austrian constitution allows the government and the administration to keep any information related to national defence non-public, including information that is not classified as secret.

A Member of Parliament (Interviewee 1) stated that all defence related spending is included in the publicly available budget. The member was not able to discuss aspects related to the classified work of the subcommittee supervising military intelligence services.

No information is publicly available on the size of the budget of the two intelligence services that are embedded in the ministry of defence, it thus remains unclear what areas of spending are classified. Not even an aggregated number of the budget of intelligence services is available, nor can a meaningful estimate be derived from the budget that is allocated to the ministry of defence (from which the defence intelligence services are funded). No well-informed estimates were found in public sources regarding the number of employees of the two intelligence agencies, or similar approximations that may allow an estimate of the budget. The same lack of budget information applies to the Federal Office of Constitutional Protection and Counter-Terrorism, which operations under the ministry of interior.

Thus, the percentage is not available to the public.

Researcher4187: The Parliament's national defence committee is not provided with a more detailed budget than the one publicly available (see Q12B) - according to a member (Interviewee 1), additional information may be provided upon request by the minister. The committee is not able to scrutinize procurement contracts of the army, with the Ministry of Defence referring to secrecy provisions it has agreed to vis-a-vis suppliers, according to a member of the committee, who referred to this practice as an ongoing violation of the constitution [due to the limitation of the legislature's oversight role by civil contractual agreements the government enters into].

The member of parliament was not able to elaborate on the details of the level of detail the sub-committee overseeing the military intelligence services is provided with but indicated that the oversight power of the committee is worse than that of the national defence committee.

Article 52a of the constitution states that the sub-committees are charged with &quoute;oversight of measures for the protection of constitutional services and their operability as well as intelligence measures for securing the military defence (...)&quoute;. Furthermore, &quoute;Each permanent sub-committee is allowed to request from the respective ministries all information and access to documents. This does not relate to information and documents, especially regarding sources, the release of which would endanger national security or the safety of people.&quoute;
Media reports suggest that this provision os interpreted broadly by the government.

In 2013, representatives of the Green party, the Freedom Party (both in opposition) and the Minister of Interior (from the Peoples' Party) criticized the Minister of Defence, stating that even during classified meetings in relevant parliamentary sub-committees, he had refused to disclose any details on cooperation agreements between military intelligence services and the NSA – which, numerous media reports have suggested, are very close. This co-operation, presumably, also has significant budget implications, such as the operation of a satellite communication station near Vienna that is reportedly used to intercept satellite communication in the Middle East. A media report has estimated the construction cost of the station to be EUR 150 million.

No other reports of omissions in the provision of information to the subcommittees was found – there is usually little public reporting about their work.

The fact that Members of Parliament are not able to receive any information on such intelligence projects that potentially have major implications for the budget of the intelligence services and decide to go public to highlight the insufficient access to information suggests that the legislature is provided with very limited or abbreviated information on secret items. Furthermore, it suggests a significant restriction of Parliaments access to information and thus a limit on its ability to control the work of the intelligence services, as determined by Article 52a of the constitution.

Response to Reviewer: In the past two years, there was some evidence that suggests significant shortcomings in regards to budgetary information accessible to the sub-committees. However, it is very difficult to evaluate this issue, given the little information that is available and the opacity of these processes.

Researcher4187: The Court of Audit provides an audit of the annual accounts to Parliament. Separate subsections scrutinize the spending of the Ministry of defence and Sport and that of the Ministry of Interior. This report is fully available to the public.

The defence section of the budget (UG.14) includes all defence related spending and appears to also include funding available to the military intelligence services. An MP stated that there is no defence related spending outside the UG 14 budget section.

The level of detail provided in the Court of Audit's annual accounts report is of the same level of granularity the budget itself has, which is not detailed enough to develop an understanding of the items and activities funding is spent on. It also does not allow to identify the budget of intelligence services, not even in aggregated form.

The head of the Court of Audit regularly testifies in Parliament, primarily in its Court of Audit committee, where the findings of the Court's reports are discussed. Agendas of the national defence committee suggest that it does not separately discuss the annual audit's subsection on military spending. It remains unclear of the audit is discussed in the permanent sub-committees overseeing the work of the intelligence services – these committees do not have publicly accessible agendas of their meetings.

No evidence was found that information is omitted from the Court of Audit reports.

It can be concluded that legislators are provided with audit reports that also cover spending of the intelligence services, but there are some omissions of information due to the low level of granularity of the budgetary information in the annual accounts. No evidence was found of a parliamentary debate on the audited annual accounts for the defence and security sector.

Researcher4187: Off-budget expenditures are banned by law. Article 51 (5) of the Constitution states that the upper spending limits of the categories of the Federal Finance Act may neither be exceeded nor may such exceeding be authorized. (6) Exemptions are only provided for cases of imminent danger and in case of national defence (whereby government and the respective committees of Parliament have to agree to exceeding the adopted budget).

All defence related expenditures are included in subsection 14 of the budget, which includes the budget of the ministry of defence and sports. The most recent implementation audit report of the defence budget by the Court of Audit shows no indication of off-budget spending. A member of Parliament (Interviewee 1) confirmed that all defence related expenditures are included in subsection 14 of the budget.

Researcher4187: According to a member of parliament (Interviewee 1), all military expenditures are included in sub-section of the ministry of defence and sport (U.14) of the adopted budget. The member stated that there recently was a debate in Parliament about allowing for a cash injection to the army, whose budget has been severely cut down, to ensure it remains operational, stating that such additional funding would indeed have been constitutionally problematic. News reports also showed that defence minister Klug in public statements stated that he would re-negotiate savings measures and budget cuts in the defence budget for the year 2015 with the minister of finance. No reports were found that suggested that the defence budget was actually increased beyond the allocation in the budget law.

The most recent budget implementation audit report issued by the Court of Audit shows no indication of off-budget spending.

There is no indication that the armed forces are generating income through illicit economic activity. A member of Parliament stated he was not aware of such problem. No other evidence or any allegations from public records were found that the the there are off-budget military expenditures.

Researcher4187: Austria continues to have a general secrecy provision in its constitution, Article 20, (3): &quoute;All functionaries entrusted with Federal, Länder and municipal administrative duties as well as the functionaries of other public law corporate bodies are, except otherwise provided by law, pledged to confidentiality about all facts of which they have obtained knowledge exclusively from their official activity and which have to be kept confidential in the interest of the maintenance of public.&quoute; In mid 2015, Parliament was discussing a constitutional amendment that would remove this provision.

Classification of documents in the Austrian parliament is regulated by the Information Classification Act of 2014, which only came into effect in 2015, thus not allowing for an assessment of its implementation. It is likely that the introduction of the Information Classification Act was related to the anticipated introduction of a freedom of information act, and to a newly granted right, enabling the opposition to initiate an investigative committee without the votes of the ruling parties.

The Information Classification Act adopts four levels of classification from Information Security Act that regulates classification for the federal government. According to the Information Classification Act, the level of classification is set by the author of a document (in most cases: the federal government). In case of an overly strict classification, the President of Parliament (who usually belongs to the same party as the prime minister) may re- or declassify a document, the government can appeal at the Constitutional Court. The security levels for documents used by the Parliament have been harmonised with EU-wide standards.

The Information Security Act (Article 2) defines four levels of classification in relation to Article 20(3) of the Constitution which lists as reasons for the secrecy of information, among other reasons, &quoute;the maintenance of public calm, order, and security&quoute;, and &quoute;comprehensive national defence&quoute;. Documents are classified as &quoute;LIMITED&quoute; if the non-authorized forwarding of information would run against the interests named in Art 20; &quoute;CONFIDENTIAL&quoute; refers to documents the publication of which is a criminal act as defined by other laws and the secrecy of which is in the public interest; information is classified as &quoute;SECRET&quoute; if the release would also pose a risk to the reasons named in Article 20; information the release of which would result in severe damage of the areas named in Article 20 is classified as &quoute;TOP SECRET&quoute;. Whoever wants to access documents that have the top three levels of classification has to undergo a security clearance (in line with the Security Police Act) or a reliability test (in line with the Military Power Act).

The integrity of classification procedures and the protection of classified information is monitored by information security commissioners in each ministry and by a information security commission, which sets guidelines and is composed of ministries' information security commissioners (Information Security Act, Articles 7, 8). At this point, it is not possible to assess the effectiveness of this system – including because no information on the implementation is accessible to the public.

At this point, the classification of material for national security reasons has been of limited relevance as regards public or parliamentary access to information. (The public does not have a legal right to access documents, Parliament only through investigative committees.) This is because authorities commonly have used other legal reasons to prevent the disclosure of information, including the Data Protection Act (which also applies to legal entities), and the constitutional secrecy provision, which applies when the non-disclosure of information is in &quoute;the interest of the maintenance of public peace, order and security, of universal national defence, of external relations&quoute;, among several other reasons.

No publicly available information was found that would indicate recent violations of classification procedures and of leaks of classified documents.

There recently have been two relevant cases where the withholding of information (thus not for reasons of national security) was struck down by courts.

In June 2015, the federal administrative court declared invalid a 2013 refusal by the Ministry of Science, Research and Economy to publish a list of all recognized offset agreements resulting from the Eurofighter purchase due to a lack of justified reasons provided in the refusal. The list had been requested by a journalist and transparency activist under the Duty to Grant Information Act. The court ruled that the reasons provided by the ministry, which had argued that the list was 'not final' information because not all offset agreements had been concluded, and that the disclosure would affect unspecified investigations by law enforcement agencies, were insufficient.

The Constitutional Court also ruled in favour of disclosure in June 2015: During the first parliamentary investigative committee initiated solely by the opposition and operating under new rules (scrutinizing the Hypo bank affair), the Ministry of Finance had submitted hundreds of blacked-out pages to parliament, arguing that banking secrecy did not allow for the disclosure of information relating to the bank. Many of these pages reportedly contained information that was already in the public domain, including press clippings. After a public outcry over the refusal of the ministry to provide information to the parliamentary committee, the ministry and opposition MPs both called on the Constitutional Court, which ruled that documents relevant to the subject of the parliamentary investigative commission have to be handed over to Parliament without censoring them.

The classification of information is legally regulated with provisions made for who can request information to be classified on the grounds of protecting national security, and how. There is insufficient experience with these recently introduced provisions, and it is not yet possible to determine the effectiveness and implementation of these provisions. However, experience from cases where authorities were requested to disclose unclassified information suggest that there is a significant risk of authorities taking steps to prevent the disclosure for politically motivated reasons although legal proceedings are likely to overturn such decisions.

Researcher4187: The ministry of defence and sports is a shareholder in three limited liability companies, neither of which are engaged in commercial of any significant scale.

Each entity is governed by a separate law. Ownership by defence and security institutions in other entities would likely require the adoption of a specific law by Parliament.

The Austrian corporate registry is searchable online, including by ownership. There is thus a high level of transparency of commercial businesses, especially for limited liability companies.

The three in which the ministry of defence and sports holds shares are
1) the national anti-doping agency (Nationale Anti Doping Agentur Austria GmbH) which is co-owned by the ministry of defence and sports, several regional governments and a commercial bank,
2) SIVBEG, an entity that manages and privatizes real estate owned by the ministry and
3) Bundessporteinrichtungen GmbH, an entity that manages several state-owned training facilities.

All three businesses have websites providing details on their activities. The ministry of finance releases financial information for all three entities.

Researcher4187: The annual accounts of the three entities owned by the Ministry of Defence and Sports were released in a report by the Ministry of Finance in 2014. As these three entities are limited liability companies, they also have to publish their annual accounts through the corporate registry (access requires payment of a fee).

The ownership of each of these entities is outlined by respective laws on these entities. Ministry of Defence ownership in new entities would most likely require parliament adopting a new law to create a legal basis for its operation.

The entities owned by the ministry of defence and sports are subject to scrutiny by the Court of Audit, which in 2013 released a follow-up report on the real-estate entity SIVBEG and scrutinized its sales of real-estate. The full Court of Audit report and a follow-up report are available online and are widely regarded as being of high-level quality.

The ministry of finance has released a report with key financial indicators for all three entities. It was not clear whether those indicators were derived from the published annual accounts of these entities, or generated by financial comptrollers in the ministry who oversee financial flows to external government entities.

Researcher4187: In 2013, the Minister of Defence stated that some 2,000 of its 22,000 employees at the time had been approved to earn income from other activities, including being members of commissions, consulting, teaching and writing books or articles. In 2011, the army tightened conflict of interest rules and banned procurement officers from working as consultants for potential contractors, including when they are on leave. The new regulation did not describe the sanctions for violators.

The Civil Servants Employment Act (Article 56) and the Federal Employees Act (Article 5) require public sector employees disclose any side-employment and bans side activities that would result in a conflict of interest with official duties. A 2014 ruling of the administrative court confirmed a disciplinary fine of EUR 3,305 against an army doctor who had worked in his private practice while on duty. Disciplinary actions imposed by the ministry are usually not published, unless there is a court ruling as a result of an appeal against the sanction.

An MP (Interviewee 1) mentioned two specific cases of high-level members of the army who were found to have had a clear conflict of interest because of inappropriate relations with army suppliers, both cases which appear to date back to the early 2000s. In both cases, sanctions against the two individuals were not very harsh, according to the MP, who added that it is very difficult to assess the extent of the problem, as no research has been conducted on the issue.

According to media reports, the so-called Airchief, the head of the Austrian air force, in 2007 was found to have been director of a company organizing air shows until 2000, while being an employee of the army. He was also reportedly registered as a representative of a company owned by his wife, which, according to media reports, in the early 2000s received payments from a lobbyist working for EADS.

A recent media report suggested that a significant number of army officers, many of whom had vocational training, might earn some money on the side without having the required clearance. No recent hard evidence on unauthorized private enterprise by ministry of defence officials was found.

Researcher4187: In 2011, the army introduced a Code of Conduct that included provisions related to corruption, bribery and conflicts of interest. The Code was publicly endorsed by the minister of defence at the time as a tool to prevent corruption.

In recent years, senior army officials have not publicly spoken about the importance of building integrity and strengthening anti-corruption measures. No reports or statements on the website of the army from the past three years were found that addressed these issues in any way.

The Code of Conduct was updated and includes a statement by the current minister of defence.

A search of Austrian media archives produced no interview or article of the current Minister of Defence, who took office in early 2013, addressing the issue of anti-corruption. No evidence was found of lower level members of the defence ministry and the armed forces making comments regarding countering corruption.

A member of Parliament (Interviewee 1) stated that internal investigators looking into alleged corruption around the purchase of Eurofighter jets were cooperating closely with prosecutors on the matter.

Researcher4187: Indications of potential criminal wrongdoings, including bribery and corruption, would have to be reported by Ministry of Defence staff to the relevant prosecutors' office after an internal investigation. Under Article 45 of the Civil Servants Employment Act, civil servants in a supervisory position have to report illegal acts in their departments to their superiors or the police. The Ministry of Defence's code of conduct also encourages staff to report suspected corruption cases to their superiors. Civil servants and army personnel found to have been involved in corruption would also face disciplinary measures in line with the Army Discipline Act, which may result in fines or dismissal. However, such steps are not public information and would only become public if court appeals are filed against those sanctions – no such recent cases were found.

There is no limitation on prosecutors to prosecute cases involving ministry of defence officials, according to a spokesperson of the anti-corruption prosecutor's office.

No information was found on the number of disciplinary sanctions imposed for proven involvement of ministry or army personnel in bribery or corruption, no data was available on cases, prosecutions and sentences of defence personnel under the relevant provisions of the Criminal Code (Articles 304 to 309).

Article 304 (1) of the Criminal Code punishes passive bribery (public officials who demand, accept or agree to the promise of an advantage from a third party for violating their duty or for not carrying out an official act) with up to three years in prison. Article 305 punishes public officials who demand, accept or agree to a promise of an advantage from a third party of unduly influencing a decision in line with their duty with up to two years in prison. Articles 306, 307 and 307a punish active bribery of a public official, i.e. the offer or promise of a bribe in exchange for an undue advantage.

Researcher4187: The General Service Orders of the Federal Army (article 9) require members of the army to report relevant developments to their superiors. The Civil Servants Employment Act (article 45) requires federal employees who head a department to report possibly criminal acts that occurred in their department to a supervisor; article 53a states that civil servants who file a report to the Federal Bureau of Anti-Corruption must not be discriminated against by his/her department because of this report.

The Ministry of Defence's code of conduct encourages the reporting of suspicious or possibly relevant corruption-related incidences to a superior. It does mention the whistleblower mechanism of the Federal Bureau of Anti-Corruption but does not refer to the anonymous whistleblower platform set up by the White Collar and Anti-Corruption Prosecutors' Office. A spokesperson of the prosecutor's office (Interviewee 2) said that there were 14 complaints filed through entity's anonymous whistleblower mechanism that were related to the Ministry of Defence since the platform was launched, on average one complaint every two months. No details on these cases or information regarding the follow-up and outcome of these reports was available.

While no media reports have focused on whistleblowing related to the defence sector, numerous media reports have covered the existing whistleblower mechanisms. The White Collar and Anti-Corruption Prosecutors' Office introduced an encrypted online whistleblower mechanism in 2013, though which anybody is able to anonymously report wrong-doings. The communication mechanism makes the complainant anonymous, such that the prosecutors are not aware of the identity of the whistleblower. In the first 1.5 years, some 2,100 reports were filed through the system, with about two thirds of the reports triggering an initial investigation or being forwarded to other prosecutors' offices, according to media reports. The office's spokesperson (Interviewee 2) said that prosecutors do not know the identity of the whistleblower. The mechanism thus appears to protect the identity and shields whistleblowers from reprisals for reporting evidence of corruption. A media report on a debate on whistle-blowing at a conference attended by judges also suggested that the reporting mechanism is anonymous and sufficiently protected.

The Federal Bureau of Anti-Corruption, which operates under the ministry of interior, offers a whistleblower mechanism for employees of the federal government and accepts complaints and reports via mail, phone, fax and (non-encrypted) email. The Bureau allows for anonymous reports, but encourages whistleblowers to provide contact information. According to Transparency International Austria, some 1,700 reports were filed in 2013 through the Bureau's mechanisms, about 1,200 of them were further pursued and forwarded to prosecutors. TI Austria has highlighted that there is need for further strengthen whistleblower-protection, including by extending protection to private sector employees.

Effective legislation and mechanisms applicable to military and official personnel exist to report corruption, and there is evidence that whistleblowing is taken seriously by MoD. Whistleblowing is promoted, but not strongly, and whistleblowers are afforded protection, but there is need to expand protection.

Researcher4187: Personnel handling classified information has to undergo vetting procedures and pass a &quoute;reliability test&quoute;, defined by the Military Power Act, which is required to access documents that have the highest three of four levels of classification. According to an article from 2007, the reliability test is carried out by the two military intelligence services.

All employees of the Ministry of Defence have to act in line with the Code of Conduct. In the context of procurement, the Code makes reference to several non-public guidance documents on procurement processes that may contain specific rules of conduct for people involved in the procurement process.

No indication was found that key personnel are routinely rotated after several years in the same position. A defence sector representative confirmed that personnel working on defence procurement in the ministry of defence are not rotated after a number of years.

There appear to be some post-employment restrictions. According to Article 20 (3a) of the Civil Servants Employment Act, civil servants cannot work for an entity within six months of leaving public service if they were involved in making decisions in their public office that affected that legal entity in the last 12 months, and if that switch would lead to a perceived conflict of interest. The penalty for violating this rule is three months of the last salary. It is not clear how strictly this provision is applied in practice.

No open source reports on the application of these procedures, on the mechanisms and practice of personnel selection for sensitive positions (i.e. procurement officers or positions that work with classified information) and on the oversight while in post was found.

There thus is some evidence that special attention is paid to personnel in sensitive positions, though these positions are not declared and any specific rules of conduct associated with such positions are not made public.

Researcher4187: The number of civilian and military personnel under the Ministry of Defence is documented in an appendix to the budget, which is publicly available on the website of the Ministry of Finance. A member of parliament (Interviewee 1) confirmed that the number of civilian and military personal is publicly available. No indication was found that the number may not be accurate.

The army publishes a White Book that contains details on staffing, but the publication has not been updated since 2012.

As a peer reviewer pointed out, numbers regarding the personnel in the militia is not proactively published, and not available with the same level of granularity as the numbers of military and civil employees.

Researcher4187: Pay rates for civilian and military personnel are regulated by the by Federal Army Fees Act, the Federal Employees Act of 1948 and the Salaries Act of 1956, all of which are publicly accessible.

Details on allowances are accessible on the website of the Ministry of Defence (http://www.bundesheer.at/pdf_pool/gesetze/hgg.pdf) and are also published in issues of the army's &quoute;Miliz info&quoute; magazine, which is also accessible on the army website.

The army also publishes pay rates, including rates soldiers in different ranks receive on international missions, on the recruitment and career subsection of its website, at http://karriere.bundesheer.at/.

As a peer reviewer highlighted, two parliamentary information requests to the minister of defence showed that several members of the minister's staff are employed based on special contracts, their salaries and allowances are thus not transparent. Article 36 of the Federal Employees Act requires such contracts to be approved by the Federal Chancellor.

Pay rates for civilian and military personnel are thus published, those for some cabinet positions on special contracts are not. As the question relates to regular employees and since information on contractual staff can be requested, score 4 is awarded.

Researcher4187: The Parliamentary Army Commission, to which military personnel can turn to file complaints about working conditions, did not mention any payment related complaints in its annual reports 2012 and 2013. The 2014 annual report mentions one case where insufficient records had been kept on the attendees of a voluntary training course, who were then not able to claim a bonus payment.

No media reports or statements by union representatives were found suggesting that personnel face problems receiving correct pay on time.

The compensation and payment-routine for military personnel is established by Federal Army Fees Act (Articles 3 to 11), that for federal civil servants by the Federal Employees Act (Article 18). Further regulation on payment modalities are provided by the Salaries Act (especially Article 7). Basic pay is non-discretionary and set in the army fees regulation document, which comprises relevant laws and orders of the minister.

Researcher4187: Vacancies have to be published in line with the Tendering Act 1989, which appears to be applied in practice: positions are publicly advertised, including on the website of the army and through the federal government's job website. The Tendering Act also stipulates that members of selection commissions, which have to include one member of the public service union, are independent in this capacity (Article 7).

Media reports suggest that high-level appointments are at times influenced by party politics. An MP (Interviewee 1) also suggested that different groups within the defence establishment are seeking to support members of their circles, and that, depending on the position, the interests of regions might also affect appointments and promotions.

In July 2013, a court ordered the Ministry of Defence had to pay EUR 16,800 in compensation to an applicant who had not been appointed head of an airforce department due to an arbitrary decision. According to the ruling, the vacancy had been tailored to another candidate.

The website of the army provides some information on entry assessments and criteria that applicants have to fulfill in order to enter the ministry of defence's military academy (graduates can become officers) and a general staff training course.

There is an established system for appointment of miliatary personell, the details of which are not published. There have been a number of documented cases where high-level appointments were not based purely on merit.

Researcher4187: Promotions appear to depend to a large extend on the time a person has served in a position and on the trainings he/she has passed and on certificates and degrees the person has earned throughout the career. Promotions are regulated by the Defence Act of 2001, the Civil Servants Employment Act, the Federal Act on Federal Employees and a number of orders that address the trainings required for different ranks, including the 2013 Generals' Training Directive.

As per the Civil Servants Employment Act, performance evaluations boards are set up by order of the minister (members are appointed for five years) which assess the performance of civil servants; this assessment serves as a basis for promotions (Articles 83 to 89). The {resident delegated to the Minister of Defence the right to appoint all officers up to the rank of Lieutenant-Colonel.

For military personnel, promotions appear to be separate from the chain of command: cadets are appointed by the commander of the army body; sergeants are appointed by the Defence Minister; officers are appointed by the President, who may chose to delegate this right to the minister (Article 6). No indications for independent scrutiny of high-level appointments made by the minister were found.

Several media reports have suggested that high-level appointments and promotions are at times influenced by party politics. An MP (Interviewee 1) also suggested that different groups within the defence establishment are seeking to support members of their circles, and that, depending on the position, the interests of regions might also affect appointments and promotions.

Personnel promotions are effected through formal appraisal processes there appear to be promotions boards in place for all personnel, though there appears to be insufficient independent scrutiny of high-level appointments, which in a several cases have been influenced by political factors and were not only based on merit.

Researcher4187: Rules are in place to prevent bribery for avoiding compulsory conscription, however no indication of a specific policy was found. The existing rules appear to be an appropriate deterrent.

Article 304 (1) of the Criminal Code punishes passive bribery (public officials who demand, accept or agree to the promise of an advantage from a third party for violating their duty or for not carrying out an official act) with up to three years in prison. Article 305 punishes public officials who demand, accept or agree to a promise of an advantage from a third party for unduly influencing a decision in line with their duty with up to two years in prison. Articles 306, 307 and 307a punish the active bribing of a public official, i.e. the offer or promise of a bribe in exchange for an undue advantage.

Cases of bribery can be anonymously reported to the White-Collar and Anti-Corruption Prosecutor's office (which would forward the complaint to the relevant prosecutor's office) or to the police. A spokesperson (Interviewee 2) said that while there were 14 complaints filed through entity's anonymous whistleblower mechanism, none of those complaints appeared to concern bribery allegations in relation to avoiding compulsory conscription.

No indications, news coverage or other public documents regarding alleged cases of bribery around conscription and recruitment processes were found, neither were indications of prosecution and punishment related to such cases. Given that every male citizen of Austria has to go through conscription procedures, it is likely that (alleged) cases of bribery would be discussed in online fora – no such evidence was found.

Soldiers who are serving their mandatory military service can report any problems to a Parliamentary Army Commission. None of the numerous complaints listed in the Commission's most recent annual reports refers to cases of bribery.

It thus appears that the rules that are in place are an appropriate deterrent for avoiding bribery in procedures related to compulsory conscription.

Researcher4187: Austria has compulsory conscription. No indication was found in regards to a policy specifically addressing bribery risks around the posting of soldiers. I refer to a government reviewer for further guidance on this.

Active and passive bribery, and the acceptance and offering of undue advantages to a public official, are outlawed by the Criminal Code (Articles 304 to 308). The Ministry of Defence has a code of conduct for all civilian and military personnel that provides some guidance on conflicts of interest and bribery, and summarizes the relevant legal provisions. Under Article 45 of the Civil Servants Employment Act, civil servants in a supervisory position have to report illegal acts in their departments to their superiors or the police.

No indications were found in the media, on the ministry of defence's website or in annual reports of the Parliament's Army Commission of cases or allegations of bribery with regard to conscription, of specific procedures in place to address any such risks or of sanctions against officers for accepting bribes in return for favourable postings.

It appears highly unlikely that bribes are used to solicit preferred postings. It can thus be concluded that current rules against bribery and procedures that are in place act as an appropriate deterrent.

Researcher4187: No indication was found that the phenomenon of &quoute;ghost soldiers&quoute; exists in Austria. The issue has not been mentioned in reports by the Court of Audit, neither in any recent annual reports of the Parliamentary Army Commission. No media reports mentioning the problem were found. An MP (Interviewee 1) stated that he is not aware of the issue being a problem.

In its 2014 annual report the Parliamentary Army Commission mentioned one case insufficient records being kept on the attendees of a voluntary training course, who were then not able to claim a bonus payment. However, there is no evidence of bad record keeping being a systematic problem.

It appears that, given the generally strong payment systems and oversight systems in the public administration, there is a very low risk of the phenomenon of ghost soldiers to occur.

Researcher4187: The organizational structure of the army, as published on the army's website, shows that the office for personal management (Heerespersonalamt), which appears to manage salary payments (Federal Army Fees Act), is seperated organizationally from the armed forces and thus from the chain of command.

The organizational structure of the central command of the ministry of defence also shows that the department for staffing/HR and the two internal audit departments are located in Section 1 of the ministry, which operates directly under supervision of the minister, while the armed forces operate under the general staff.

Article 44 of the Federal Army Fees Act states that payments have to be transferred to a bank account.

The Parliament's Army Commission has not highlighted any cases where commanders exerted any influence over the payments for personnel serving under their command. No media reports or other public sources were found that highlighted problems in this area.

There thus appears to be a separation of the departments that manage and process payments as well as internal auditors who can scrutinize payments, and the command structure of the armed forces. The salaries and payments to military personnel are set by the Army Fees Regulation, consisting of the Federal Army Fees Act and several orders of the minister.

It appears unlikely, that superiors can interfer in the payments made to people serving under their command.

Researcher4187: The Ministry of Defence's has adopted a code of conduct applies to all its civilian and to all military staff. It provides some guidance on bribery, gifts, hospitality, conflicts of interest and on other income and activities while working for the ministry of defence. It does not address post-employment activities.

The code is publicly available online. The ministry's Department of Disciplinary Affairs and Complaints is responsible for the Code and its implementation. However, no information is available that would indicate how robust the oversight is. No details on disciplinary measures taken against staff are made public.

Response to Peer Reviewer: the ministry has not made public any details on enforcement and the Code because does not cover all aspects required by the methodology (post-separation activities).

Researcher4187: No public evidence was found indicating whether or not breaches of the code of conduct are effectively addressed. An MP (Interviewee 1) stated that he was aware of disciplinary violations being addressed by the department for &quoute;disciplinary matters and complaints&quoute;. The MP also stated that those disciplinary violations for the most part do not concern corruption-related issues.

The release of information on disciplinary sanctions to the public is banned by article 34 of the Army Disciplinary Act of 2014. Article 4 requires that in case of a suspected criminal act, the relevant prosecutor's office has to be informed.

The government reviewer stated that the results of disciplinary prosecutions are published twice a year in an anonymized form. However, the assessor found no such information on the website of the ministry of defence. It is possible that the information is only accessible to members of the armed forces.

Response to reviewer: I revised the score to 3. however, I could not confirm that the information the government reviewer claims is released is actually published. I spent quite a bit of time searching the website of the ministry of defence and could not find the data.

Researcher4187: No press releases or other indications were found on the websites of the Ministry of Defence, of the Federal Anti-Corruption Bureau or of the International Anti-Corruption Academy that would indicate that defence staff attends anti-corruption trainings. Orders that describe training curricula for different ranks, including those offered by the national defence academy, did not list corruption-related subjects are part of the curriculum.

A member of parliament (Interviewee 1) stated that he was not aware of any regular anti-corruption related trainings being conducted for staff at the ministry of defence.

Federal Bureau of Anti-Corruption operates under the Ministry of the Interior and by law enjoys some level independence within its structure. It offers regular trainings on the detection and prevention of corruption for staff from all ranks and departments of the Ministry of Interior. The Bureau's mission includes the promotion of anti-corruption measures on the federal level.

According to the government reviewer, regular anti-corruption trainings take place and training is especially provided to individuals who have disciplinary powers however there is no publicly available evidence of this.

Researcher4187: No details on corruption-related investigations or the reasons why prosecutors stop pursuing cases have been made available to the public – a fact that has been criticized by a leading anti-corruption expert. The fact that the minister of justice is allowed to decide on whether prosecutors should bring a case to court or not has fuelled speculation of political interference.

A search of media coverage produced no articles that mentioned convictions for corruption-related crimes related to the defence sector in recent years. The investigation into the Eurofighter jets procurement has been going on for numerous years and was subject to a parliamentary investigative commission and continues to be investigated by prosecutors in Rome, Munich and Vienna.

Anti-corruption prosecutors have investigated a former defence minister over the alleged sale off army real-estate assets to companies with ties to the social democratic party below market price – allegations that the former minister has denied. In 2014, the case file with the results of the investigation was submitted to the ministry of justice.

Former Member of the European Parliament and former minister of interior Ernst Strasser was sentenced to three years in prison in 2014 after offering to influence laws in the European Parlaiment in exchange for money that was offered to him by British reporters.

In 2014, a ministry of defence procurement official was charged with procuring cameras and selling them for personal profit on Ebay (there appears to have been no media coverage on the outcome of the trial).

An Austrian arms broker and husband of a former minister in 2013 were found not guilty on money laundering charges due to a lack of evidence; UK prosecutors had dropped all charges against him as part of a settlement between BAE Systems, the UK and US in 2010.

According to a government reviewer of this assessment, the results of disciplinary prosecutions are published twice a year in an anonymzied form. The assessor found no such information on the website of the ministry of defence. It is possible that the information is only accessible to members of the armed forces.

The ministry of justice maintains a database in which prosecutors can publish anonymized cases that they stopped pursuing. However, the publication is a rare exception rather than a policy, since 2011 only around 50 cases were published across Austria.

Media reports have highlighted that the anti-corruption prosecutor's office remains understaffed and suffers from a high level of staff turnover, which affects complex, long-running investigations and prolongs them further. In February 2015, the anti-corruption prosecutor's office only had 29 of its 40 prosecutor positions filled.

There are thus examples of outcomes of prosecutions being made public. However there is no policy that they must be. There are also some cases of effective prosecutions in the public domain but some scepticism over the effectiveness of prosecutions remains.

Response to reviewers: I revised the score to 2 and added one case of a defence procurement official being charged. A score of 3 does not appear adequate, as there is no evidence of a policy that results of prosescutions are made public. I was unable to verify the information that anonymized results of disciplinary actions are published by the ministry of defence.

Researcher4187: Active and passive bribery, and the acceptance and offering of undue advantages to a public official, are outlawed by the Criminal Code (Articles 304 to 308) and punished by up to two years of in prison. This also applies to small bribes (facilitation payments) in case they are made or promised to, or demanded by a public official and affect the outcome of an official decision. Stricter anti-corruption rules only came into force in early 2013, and by early 2015 there was yet little data available on the application of these articles and to what extend small bribes are prosecuted.

A 2013 EU Commission Eurobarometer poll on corruption found that &quoute;Austria is the only country in Western Europe where a relatively large proportion – almost one-third of the respondents – would find it acceptable to do a favour or give a gift in exchange for a public service.&quoute;

Researcher4187: The Austrian Security Strategy briefly mentions corruption on a couple of occasions, alongside numerous other factors and aspects that affect security. However, it does not provide any details on how corruption might affect peace and security, the army's operations as part of EU and UN missions, or enable security threats at home. Neither does it provide any guidance on how to tackle or respond to corruption-related challenges.

The Code of Conduct adopted by the ministry of defence shows that Austria recognizes corruption as an aspect of governance. However, there is no clear evidence that corruption is seen as a strategic issue for operations. And there appears to be no explicit doctrine on this subject that goes beyond the Code of Conduct.

Response to Reviewer: I left the score at 1 as there appears to be no doctrine and no evidence that corruption is seen as a strategic issue for operations.

Researcher4187: No publicly available indications were found that commanders, including those who are deployed on missions, receive trainings on corruption issues. An MP (Interviewee 1) was not aware of any systematic anti-corruption trainings.

There is no evidence in media reports or other public sources that commanders mishandled corruption cases or turned a blind eye to corrupt activities in the field.

According to the government reviewer, the intelligence service trains key leaders in peace support operations about different issues e.g. organized crime and corruption and there are also courses for all commanders before deployment on missions. However, there is no relevant information regarding the Joint Forces Command and anti-corruption trainings. there are no curricula or details on the trainings they conduct online.

Researcher4187: No information was found in media reports, on the ministry of defence's website or other public sources on whether Austria regularly deploys specially trained professionals to monitor corruption risks in field missions.

The only recent Court of Audit report scrutinizing a foreign mission of the Austrian army (Chad, released in 2011) did not make any references or recommendations regarding bribery or corruption risks in this mission, nor to staff expertise in this field.

According to a government review, legal advisors are usually deployed in Peace Support Operations who provide advise to the commanders and staff, including concerning disciplinary issues, anti-corruption and laws of armed conflict. However, it is not clear what training these advisors have, how often they are deployed and whether they can be regarded as trained anti-corruption monitors.

Researcher4187: The only publicly available guidelines related to anti-corruption guidelines are in the Code of Conduct of the Ministry of Defence, which applies to all its staff and members of the armed forces, but which is not tailored specifically to deployments. No publicly available information on anti-corruption trainings for procurement officers that are deployed on peacekeeping operations was found.

The Code of Conduct references two documents containing procurement rules and guidelines (&quoute;Richtlinie für den Beschaffungsablauf&quoute; und &quoute;Verfahrensanweisung für Beschaffungen&quoute;), but neither of those documents appear to be publicly available. However, they might contain guidelines that are relevant to mitigate contracting risks while on missions.

There appear to be guidelines for addressing such corruption risk, but they are not public documents, they thus may be incomplete or general. According to a government reviewer, there is anti-corruption training for procurement officers, but it remains unclear whether this also applies to scenarios relevant to operations during deployment on missions.

Researcher4187: There is no evidence that would suggest that Austria has ever worked with private military contractors in any way. An opposition MP (Interviewee 1) confirmed that such companies have never been hired.

Austria is committed to &quoute;everlasting neutrality&quoute;, as per the Neutrality Act of 1955 the Article 9a of the Constitution and there does not appear to be a legal basis for hiring private military contractors.

Austria was among the 17 initial signatories of the Montreux Document, which is described as &quoute;first document of international significance to define how international law applies to the activities of private military and security companies (PMSCs) when they are operating in an armed conflict zone. It contains a set of good practices designed to help states take measures nationally in order to fulfil their obligations under international law.

While there is no indication suggesting that Austria has ever hired PMCs, there appears to be no regulation explicitly banning the use of such contractors. According to a government reviewer, Austrian troops have come in contact with PMCs while serving on past missions and worked alongside PMCs contracted by other states.

Researcher4187: Austria has legislation covering procurement, mainly the Federal Procurement Act of 2006, and the Act on the Creation of a Federal Procurement Agency. Rules for the procurement of militarily sensitive goods and services are provided in the Federal Defence and Security Procurement Act 2012. No indication was found that any items are exempt from these laws.

Procurement rules, however, don't apply to agreements signed by Austrian government bodies with governments of other countries if they concern the provision of military equipment or sensitive materials or are in connection to services or construction related to such provisions, or concern services or construction for military purposes (§9, Para. 9, Federal Defence and Security Procurement Act 2012).

As a member state of the European Union, Austria is mandated to follow standards laid out in EU procurement directives. Article 346 of the Lisbon Treaty on the Functioning of the European Union states that &quoute;(a) no Member State shall be obliged to supply information the disclosure of which it considers contrary to the essential interests of its security; (b) any Member State may take such measures as it considers necessary for the protection of the essential interests of its security which are connected with the production of or trade in arms, munitions and war material; such measures shall not adversely affect the conditions of competition in the internal market regarding products which are not intended for specifically military purposes.&quoute;

Article 57(1) of the Defence and Security Procurement Act requires that the procuring entity excludes bidders that have been convicted (or that have individuals in their management that have been convicted) for bribery (Articles 302, 307, 308 and 310 of the Criminal Code), fraud, accepting a gift, money laundering, membership of a criminal organization, collusion, embezzlement and a number of other crimes.

Austria has legislation covering defence and security procurement, only items that have a particular national importance or sensitivity are exempted. However, it is unclear to what extent there is independent scrutiny, as the information on the parliamentary committee that oversees the work of intelligence services is also classified. No public evidence of independent scrutiny was found.

Researcher4187: Cornerstones of the procurement cycle from tender announcement to award and possible appleas mechanism is described by the Federal Procurement Act and the Federal Defence and Security Procurement Act.

The Defence and Security Procurement Act does not contain provisions on the planning stage of the procurement cycle. The formal procedures for defining purchase requirements are laid out in documents that are not accessible to the public. A Court of Audit report stated that formal procurement planning processes of the ministry of defence are defined in the (internal) directive on the procurement process (as revised in 2010) and in the directive on amy planning (&quoute;Richtlinie für den Beschaffungsablauf – Neufassung 2010&quoute;, &quoute;Richtlinie für die Bundesheerplanung – Die Planungsdokumente&quoute;). According to the report, the department in charge of procurement planning at the ministry of defence is Sektion II, while Sektion III is responsible for the implementation of procurement projects. The Court of Audit also found that the ministry has not set clear priorities for the implementation of needed procurement processes.

There appears to be no public needs assessment. The Austrian Security Strategy appears to be too vague of a document to provide a sound basis for purchasing decisions.

Tender announcements are posted on the ministry of defence website and in the official gazette. Occasionally, some basic details on contract awards, such as the number of objects, the type of goods procured, the overall value and the manufacturer of the good, become known to the public through budget documents, reports of the Court of Audit or media reports. For tenders that have to be competitively procured EU-wide, contract announcements and contract award meta data is published in the EU Commission's TED service.

In the past, some details about selected purchases were published in the Army's bi-annual white book. However, this publication has not been re-issued since 2012.

Information on asset disposals is only made public (postings on the ministry website, media reports) when the assets are auctioned or sold off to the public, which is often the case with vehicles or real estate.

A member of parliament (Interviewee 1) stated that the Ministry of Defence regularly refuses to provided signed procurement contracts to the relevant committee, citing confidentiality agreements stipulated in those contracts.

Thus, the defence procurement cycle is disclosed only in a general and abbreviated way.

Researcher4187: Some oversight processes are detailed in the relevant procurement acts. Most importantly, bidders can address the administrative court to request a review of the award process or to appeal against an award decision (Articles 291 to 342 of the Federal Procurement Act, Articles 135 to 137 of the Defence and Security Procurement Act).

The Ministry of Defence's code of conduct refers to internal procurement documents (&quoute;Richtlinie für den Beschaffungsablauf&quoute;, &quoute;Verfahrensanweisung für Beschaffungen&quoute;) that appear to provide detailed instructions on internal processes related to procurement. However, it is unclear to what extent these documents address oversight and anti-corruption aspects, they are not available to the public.

The Court of Audit, which is independent from the government (Constitution, Article 121) provides some external oversight through occasional in-depth audits. The Court has criticized, among other things, that the work of sub-commissions in the procurement process in the past was insufficiently documented and that not all documents relevant to the price of the procured good were attached to the final contract. In response to this criticism, the Ministry of Defence has improved internal procurement guidelines and partially implemented recommendations.

The follow-up found that the ministry partially followed a recommendation to establish rules on the implementation of large-scale procurement projects with complex processes and higher risk. The Ministry of Defence introduced new internal guidelines on the procurement process, including a project management handbook, but this book does not include the planning stages of procurement (implemented by Department II (Sektion II) of the Ministry), only the delivery phase (implemented by Department (Sektion) III. A recommendation of the Court that the ministry should base the quantity of procured equipment of a strategic needs assessment, was not implemented.

Internal oversight over the procurement process is also provided by the internal audit departments. There is no public information available on the effectiveness of internal oversight mechanisms.

A Member of Parliament (Interviewee 1) also stated that internal oversight mechanisms are at work at the ministry of defence but that they are undermined by at times insufficient documentation of procurement processes.

A representative of the Austrian defence industry (Interviewee 3) stated that in his view, there were sufficient checks in the procurement process, but also underlined that the Ministry of Defence has not made major purchases in the recent past. A spokesperson of the White Collar and Corruption Prosecutor's Office (Interviewee 2) stated that the Ministry of Defence forwarded a number of cases with indications of corruption and that there was flawless cooperation with the internal audit department of the Ministry of Defence in those cases.

In 2014, a ministry of defence procurement official was charged with procuring cameras and camera equipment for the army, and then selling it for personal profit on Ebay (there appears to have been no media coverage on the outcome of the trial). The civil servant was accused of selling 123 items with a value of EUR 256,000 between August 2008 and October 2011.

Due to the fact that Austria has been for the most part governed by grand-coalition governments, consisting of the two largest parties (or, on some occasions, one of the two largest parties forming a coalition with the third largest party), changes of government are unlikely to affect oversight mechanisms.

Oversight mechanisms appear to be formally in place and there is some evidence of them being active. However, there is also evidence that they may not always be effective, and results from internal investigations and internal oversight mechanisms are not transparent.

Researcher4187: Most purchases are not disclosed to the public. The Ministry of Defence does not pro-actively release any information online on planned or conducted purchases. In some cases, the general intention of the government to buy specific new equipment are subject to public debates and covered by the media. There is no public information on forward purchase plans for the next few years.

Tender announcements are published on the Ministry of Defence website. Limited meta-data on some tender announcements and contract awards are published through the European Commission's tender electronic daily service. This data covers contracts that are procured through an open, EU-wide tender. Data published on EU-wide tenders includes the procuring entity, CPV code, name of the supplier (usually), type of procedure, number of bidders (in the majority of cases), contract value (in the majority of cases). However, the overall volume of contracts that are subject to EU-wide tenders is only a fraction of the overall procurement volume.

Procurement documents/requests for proposals have to be requested from the procuring entity by a potential bidder and usually contain secrecy clauses that ban the recipient from discussing or sharing them.

A member of parliament (Interviewee 1) stated that the Ministry of Defence regularly refuses to provide signed procurement contracts to the relevant committee, citing commercial confidentiality clauses with the suppliers stipulated in those contracts. The MP also stated that Parliament has until today never received a copy of the Eurofighter purchase agreement.

A statutory confidentiality clause in the Constitution and the Austrian Data Protection Act, which provides privacy protection to legal entities, have been provided as justification by the authorities to not release any detailed information or contracts related to public procurement.

In the past, some details about selected purchases were published in the army's bi-annual &quoute;white book&quoute;. However, this publication has not been re-issued since 2012.

No recent examples of any Ministry of Defence contracts that were released to the public were found. The fact that contracts are not even partially released suggests that the secrecy is not linked to specific security concerns. The approach of the Ministry of Defence mirrors a general approach of the Austrian government to keep contracts confidential.

There is evidence that many defence purchases are not made public, and there is no security justification for this information being withheld from the public.

Researcher4187: Neither the Federal Procurement Act nor the Federal Defence and Security Procurement Act make reference to any integrity procedures or compliance standards that suppliers need to have or should provide (beyond compliance with the law).

Companies are not required to have compliance programmes or business conduct programmes in place to bid for ministry of defence contracts. A defence sector representative (Interviewee 3) stated that he was not aware of specific criteria or standards in regards to compliance and code of business conduct.

Article 57(1) of the Defence and Security Procurement Act requires that the procuring entity excludes bidders that have been convicted (or that have individuals in their management that have been convicted) for bribery (Articles 302, 307, 308 and 310 of the Criminal Code), fraud, accepting a gift, money laundering, membership of a criminal organization, collusion, embezzlement and a number of other crimes. A similar provision is included in the Federal Procurement Act (Art. 68).

There are thus no requirements placed on companies beyond what is generally in company law. However, during the bidding process, the government excludes individuals that have been convicted for corruption and thus discriminates companies on the grounds of integrity.

Response to reviewers: In my opinion, a score of 2 is not justified although it is suggested by both reviewers, because there is no evidence that companies have to sign a no-corruption clause in all contracts.

Researcher4187: The Austrian security strategy appears to be too vague and broad in order to provide guidance for any procurement requirements or purchase priorities. A large element of procurement appears to be opportunistic and not based on long-term planning.

A member of parliament (Interviewee 1) stated that the strategy was too broad to allow for procurement requirements to be derived from it.

A Court of Audit investigation into the procurement of two types of vehicles by the Ministry of Defence found a lack of strategic planning behind the purchases. A follow-up report by the Court highlighted that a previous recommendation for the ministry to base the quantity of procured equipment on a strategic needs assessment was not implemented.

According to a media report, the army now appears to have a total of 12 pilots for 15 Eurofighter jets that were procured in the 2000s, additional pilots were let go in 2014 because of cut-backs.

In February 2015, within days after the Charlie Hebdo killings in Paris, the Austrian government decided to allocate an additional EUR 260 million to policing, with a focus on counter-terrorism readiness. Interior minister insisted on procuring a new fleet of helicopters for counter-terrorism purposes under the ministry of interior, an offer by the ministry of defence to use its existing fleet for this purpose was declined. It appeared that here was an apparent lack of strategy and coordination between the needs and resources of the two respective ministries and that procurement plans were driven by day-to-day political events, not long-term needs assessments.

While there is a security strategy, it appears to have little relevance for defining procurement requirements, which are not always grounded an appropriate needs assessments. However, there has been very little defence procurement in the past two years due to major cutbacks in the defence budget. As a result, there was little procurement that could be described as falling outside the framework of the security strategy.

Researcher4187: The Defence and Security Procurement Act contains provisions on tender documentation and the principles and requirements this documentation needs to fulfil (Art. 67, 68).

A 2014 report by the Court of Audit on the procurement of sports utility vehicles and all-purpose-vehicles by the Ministry of Defence found a lack of strategic planning behind the purchases and pointed out that there was no clear needs-assessment on the number of vehicles that were actually needed at different points in time. The Court also criticized the absence of coherent project management for large procurement processes, highlighting that the department carrying out the planning of the purchase was insufficiently connected to the department carrying out the later stages of the procurement process.

The Defence and Security Procurement Act does not contain provisions on procurement planning processes. The formal procedures for defining purchase requirements are laid out in documents that appear to be non-public. The Court of Audit report stated that formal procurement planning processes of the Ministry of Defence are defined in the (internal) directive on the procurement process (as revised in 2010) and in the directive on amy planning (&quoute;Richtlinie für den Beschaffungsablauf – Neufassung 2010&quoute;, &quoute;Richtlinie für die Bundesheerplanung – Die Planungsdokumente&quoute;). According to the report, the department in charge of procurement planning at the Ministry of Defence is Sektion II, while Sektion III is responsible for the implementation of procurement projects. The Court of Audit also found that the ministry has not set clear priorities for the implementation of needed procurement processes.

An MP (Interviewee 1) recounted that until the 1990s, the Ministry of Defence regularly produced detailed reports on the state of the army, that provided detailed qualitative and quantitative information – such reports appear to be no longer created.

There is evidence that the ministry of defence makes most purchases on clearly identified requirements, but there is also evidence of opportunistic and unplanned purchases.

Researcher4187: Austrian procurement rules generally allow for single-sourcing and direct negotiated purchases if the value of the purchase is below EUR 100,000. No data was publicly available on the total procurement volume that was single-sourced or awarded to bidders in negotiated procedures without a public tender being held. It was also not possible to verify if and what contracts had been omitted from open tendering procedures that would have been above the legally required thresholds. In early February 2015, five tender announcements were published on the Ministry of Defence's website, including one for ammunition.

A representative of the Austrian defence industry (Interviewee 3) stated that he was not aware of larger contracts being single sourced and expressed his confidence that the ministry was procuring contracts in line with the thresholds defined in Austrian procurement legislation.

The Defence and Security Procurement Act provides a number of justifications for single-sourcing (Article 25), including because of urgency, the purchase of goods that are traded and sold on public exchanges, if they concern research and development activities or if only one supplier has the technical ability or right to provide the good or service.

A search of announced tender calls submitted by the Ministry of Defence and Sport to the EU Commission's tenders electronic daily service found that in 2013, 65 such tender announcements were released that met the threshold requiring EU-wide procurement. 21 stated they would be awarded through a negotiated procedure, 41 through open procedures, five through restricted procedures and two through through a negotiated procedure without a call for competition.

A search for contract award notices published on behalf of the Ministry of Defence in 2013 on the EU Commissions TED service produced 39 results. In 15 cases, it appeared that only a single bidder submitted an offer – which could be a possible indication for a tender being not truly competitively designed, or because of an already existing framework agreement with a supplier through the federal government's Federal Procurement Agency; in 9 cases there were 2 bidders submitted offers; 2 tenders had 4 bidders; 13 tenders had between 5 and 8 participating bidders.

No publicly available data, documents, statements or analysis of the competitiveness of procurement processes and possible reasons for single-sourcing (beyond the defined thresholds in the legislation) were found.

The government has continued to set the threshold for single-sourcing to EUR 100,000. This threashold does apply to all government procurement on all levels. Construction contracts can be single-sourced without any announcement for up to EUR 1 million. The governent has claimed that this rule benefit Austrian small- and medium size enterprises and that especially the construction sector has lobbied to keep these high threasholds in place, according to media reports.

However, due to a lack of data and transparency, it is impossible to verify that the lack of transparency and competitive tendering actually helps local small and medium size enterprises. The Threshold Act continues to be renewsed on an annual or bi-annual basis and sets a higher threashold than is set by EU directives.

Defence procurement is conducted in principle as open competition, but a significant percentage of the value of contracts appears to be single-sourced, without adequate justification.

Researcher4187: Tender boards are subject to the Ministry of Defence's code of conduct which applies to all civilian and military personnel. It is possible that additional regulations are included in internal orders and guidance documents that are not publicly available.

The Federal Procurement Act and Federal Procurement Defence and Security Act Auditing stipulate that a re-assessment takes place if a tender process or tender award is challenged by filing a complaint with the administrative court. Administrative courts, which are independent from the government, were tasked with ruling on procurement appeals in the beginning of 2014, their decisions are published online but are largely anonymized. By March 2015, only one procurement appeal case concerning the Ministry of Defence was found among released court cases.

There may be additional internal procedures stipulating audits in non-contested contract awards but no publicly available description of such procedures nor documents on such audits were found.

Researcher4187: Article 168b of the Criminal Code punishes illegal coordination and collusion between bidders for a government tender with up to three years in prison but exempts individuals from punishment who voluntarily prevent the state entity from entering into such a corrupt agreement. Article 57 of the Defence and Security Procurement Act stipulates that any bidders who have been found guilty of of participating in collusion (violating Article 168b of the Criminal Code) will be excluded from a procurement process.

No publicly available information was found on recent cases of sanctions being applied to companies or individuals in the defence and security sector for collusion.

There are a number of recent cases of companies of different sectors, including logistics and food producers and supermarket chains being subject to multimillion Euro fines for illegal price agreements and cartels. The Austrian Competition Authority has a record of strong action against apparent cartels in various sectors of the economy – such cases are usually settled out of court with the accused agreeing to pay significant fines. The agency also provides a leniency mechanism for witnesses who want to come forward and report illegal coordination between companies.

Collusion is actively discouraged by the government and there is evidence of offending companies facing punishment. There have been a number of cases of collusion that have been discovered and sanctioned (usually through financial settlements) by anti-trust authorities.

Researcher4187: Little public information on the capacity of contracting staff is publicly available. Procurement staff work under the Ministry of Defence's general directive for arms and procurement (Direktion Rüstung und Beschaffung), according to a ministry memo on its internal structure.

An MP (Interviewee 1) stated that the individuals working on procurement did have the necessary skills, but described the procurement departments as understaffed, creating strong corruption risks. The MP stated that because of the understaffing, a single procurement officer might be able to tailor a procurement procedure towards a specific outcome. A representative of the Austrian defence industry (Interviewee 3) stated that he was not aware of shortcomings in terms of the qualification of procurement staff and stated that there was sufficient staff in the relevant departments.

No evidence for undue influence from higher grades within the organization was found. The Court of Audit has not mentioned issues related to procurement staffing in recent reports. No further public information, reports or media stories addressing the capacity of procurement staff in the defence ministry were found.

It appears that procurement staff are trained and empowered to ensure that defence contractors meet their obligations. However, there may be minor shortcomings in the procurement departments' ability to fulfil their obligations.

Researcher4187: Bidders can address the administrative court to request a review of the award process or to appeal against an award decision (Articles 291 to 342 of the Federal Procurement Act, Articles 135 to 137 of the Defence and Security Procurement Act). Administrative courts, which are independent from the government, were tasked with ruling on procurement appeals in the beginning of 2014, their decisions are published online but are largely anonymized. By March 2015, one procurement appeal case concerning the ministry of defence was found among released court cases. In other areas, such as infrastructure, there are some well-documented recent cases of companies objecting to the awards of large contracts.

There are no legal provisions that would provide specific protection to private sector whistleblowers. There appears to be no formal protection from discrimination when a company files appeals for genuine complaints.

Since 2013, the White Collar and Anti-Corruption Prosecturo's office has been operating an anonymous, encrypted whistleblower mechanism. According to a spokesperson, 14 reports were filed concerning the ministry of defence (on average a report every two months), two of these reports included allegations of malpractice in procurement. The prosecutor's office stated that because communication with whistleblowers is anonymous, it is not able to identify who files the complaint.

No public evidence was found that companies were being unfairly disadvantaged or debarred from future procurements after filing a complaint. For the year 2014, one case was found where a company filed a complaint over the award of a procurement award by the ministry of defence with the administrative court (the court sided with the company). The lack of transparency around procurement processes makes it difficult to assess such a risk.

While formal mechanisms are in place to allow companies to complain about perceived malpractice in procurement, it appears possible that companies may self-censor themselves and not file a complaint, presuming that it could be disadvantageous to do so, also taking into account the significant volume of single-sourced contracts.

Researcher4187: Individuals who are part of corrupt schemes can be prosecuted under the criminal code for active and/or passive bribery and if found guilty could serve up to two or three years in prison. It is unclear what contract penalties and additional provisions individual contracts include, as these contracts are not publicly available.

In the case of the Eurofighter procurement, Austrian defence ministers have repeatedly threatened that it might cancel the contract if an investigation provides for sufficient evidence to do so. The contract reportedly contained a so-called Code of Business Conduct provision, under which Austria would be able to fully or partially cancel the contract if the supplier were found to be bribing decision makers or to provide advantages to actors who would be able to directly or indirectly influence the purchasing decision.

The procuring entity is required to exclude bidders that have been convicted (or that have individuals in their management that have been convicted) for bribery (Articles 302, 307, 308 and 310 of the Criminal Code), fraud, accepting a gift, money laundering, membership of a criminal organization, collusion, embezzlement and a number of other crimes (Article 57 of the Defence and Security Procurement Act and Article 58, Procurement Act). Ministry officials are required to forward cases with indications of criminal wrongdoings to the relevant prosecutor's office (Civil Servants Employment Act, Article 45).

A spokesperson of the White Collar and Corruption Prosecutor's Office (Interviewee 2) stated that the Ministry of Defence forwarded a number of cases with indications of corruption and that there was flawless cooperation with the internal audit department of the ministry of defence in those cases.

No public information was found on any recent cases where Austria imposed sanctions on a corrupt supplier or of convictions in cases related to procurement cases involving the Ministry of Defence.

Sanctions by the procurement executive, such as prosecution or debarment, are available but there was no evidence whether and how often such sanctions are applied in practice.

Researcher4187: No information on the current due diligence and auditing requirements for offsets was found on the relevant section of the Ministry of Science, Research and Economy's website, on the website of the Ministry of defence or in relevant laws in early 2015.

Some information is available on the auditing process based on which the Ministry of Economy accepted 1,376 Eurofighter offset deals with a value of EUR 3.3 billion, out of 1,506 deals with a value of EUR 4.06 billion that were submitted by the supplier between 2003 and 2010.

According to a Ministry of Economy press briefing from November 2012, the ministry carried out a formal evaluation of every submitted offset contract based on a number of criteria, and, starting from 2006, the auditor KMPG carried out an annual sample analysis of cases. Based on contracts, delivery confirmations and other documents as well as through on-sight checks, the auditors verified that offset-deals were in line with the agreed terms.

However, numerous questions and allegations over irregularities regarding the offset contract for the Eurofighter jets (see below) indicate that, at least at the time, the Ministry of Science, Research and Economy's due diligence and auditing requirements may have been insufficient to effectively detect and address risks to the integrity of the program.

Around offset deals for the Eurofighter jets, there have been allegations that offset deals were &quoute;bought&quoute; by the manufacturer through brokers, without informing the Austrian government of this practice. Member of Parliament Peter Pilz has suggested that companies which had already done deals that would qualify as offset deals, as defined in the (secret) Eurofighter contract, received payments through brokers and shell entities, and in exchange would allow Eurofighter to report these deals as offset agreements to the Austrian government, to avoid paying a EUR 200 million contract penalty for not delivering the agreed volume of offset deals. These claims have been echoed in several reports by reputable media outlets.

A 2006 report by the Court of Audit into the offset mechanism for the Eurofighter jets criticized the framework as &quoute;intransparent&quoute; and highlighted &quoute;need for improvement&quoute;. A 2013 follow-up report highlighted that at the time, the recommendation for the ministry of defence and the ministry of economy to cooperate more closely in regards to offset agreements had not been implemented.

In June 2015, the federal administrative court declared invalid a 2013 refusal by the Ministry of Science, Research and Economy to publishing a list of all recognized offset agreements resulting from the Eurofighter purchase due to a lack of justified reasons provided in the refusal. The list had been requested by a journalist and transparency activist under the Duty to Grant Information Act. Several days after the decision became public, the Ministry of Science, Research and Economy published the list of offset deals (dated from 2012) on its website – it could have also provided a new justification to keep the list secret.

Response to reviewer: A score of 2 does not seem justified, as there is no evidence of follows up audits on offset contract performance.

Researcher4187: The government did not make details on offset deals available to the public until spring 2015. It is not clear for which and how many purchases the Ministry of Defence has agreed to offset deals. A major known case of offset deals is the Eurofighter purchase in 2002.

The Ministry of Science, Research and Economy, which is charged with recognizing the fulfilment of offset deals for the Eurofighter contract, had rejected requests for the disclosure of the names of companies that that were a party of offset deals recognized by the ministry. It has also refused to disclose the legal argument behind not making this information public.

In June 2015, the federal administrative court declared invalid a 2013 refusal by the Ministry of Science, Research and Economy to publishing a list of all recognized offset agreements resulting from the Eurofighter purchase due to a lack of justified reasons provided in the refusal. The list had been requested by a journalist and transparency activist under the Duty to Grant Information Act. Several days after the decision became public, the Ministry of Science, Research and Economy published the list of offset deals (dated from 2012) on its website – it could have also provided a new justification to keep the list secret.

The list contains a contract number, the Austrian partner company, the foreign company involved in the offset deal, a brief description of the subject of the agreement and the recognized value of the agreement.

A journalist and transparency activist (Interviewee 4) is currently suing the Ministry of Economy over the disclosure of the exact contractual wording with regard to the confidentiality of the names of companies that received offset agreements.

The government now makes public some details of offset contracts and programmes, including a full list of the contracts, including details of the investments and the supplying companies.

Researcher4187: No indication was found that offset contracts are subject to competition regulation. It also appears that they are not awarded on a competitive basis but are civil agreements between two companies that are then recognized by the government as an offset agreement. No indications were found that offset contracts have been used in recent years – possibly due to the fact that no major foreign arms purchases have been made by the army recently.

The defence and Security Procurement Act of 2012 makes no reference of offsets, a section on website of the Ministry of Economy, which is in charge of coordinating offset deals for the Ministry of defence, does not make any reference to a written policy regarding offsets – it states that it was put in charge of offset coordination by a 1978 oral government decision – nor does it mention any policy changes since the Eurofighter offset deals were agreed.

Around offset deals for the Eurofighter jets, there have been allegations that offset deals were &quoute;bought&quoute; by the manufacturer through brokers, without informing the Austrian government of this practice. Member of Parliament Peter Pilz has suggested that companies which had already done deals that would qualify as offset deals, as defined in the (secret) Eurofighter contract, received payments through brokers and shell entities, and in exchange would allow Eurofighter to report these deals as offset agreements to the Austrian government, to avoid paying a EUR 200 million contract penalty for not delivering the agreed volume of offset deals.

Researcher4187: No apparent provisions regulating the use of intermediaries were found, neither in the Federal Procurement Act and the Federal Procurement defence and Security Act nor in other publicly available sources. It is possible that the role of intermediaries is addressed in internal documents that are then reflected in tender documents (which are generally not available online).

No evidence on recent cases in which intermediaries were used was found. However, in recent years, more details emerged over the alleged use of intermediaries by EADS around Austria's purchase of Eurofighter jets and the offset agreements related to that purchase.

According to several media reports, EADS used external &quoute;offset-providers&quoute;, reportedly including an Italian citizen who set up a British shell-company called Vector Aerospace to arrange and collect contracts that qualified as offset-deals under the agreement with the Austrian government. Vector Aerospace received payments of at least EUR 100 million from EADS, according to media reports. Allegations that some of this money was used for bribes continue to be investigated by prosecutors in Austria, Italy and Germany, according to media reports.
The extensive use of intermediaries was also documented by the parliamentary investigative committee on the Eurofighter purchase.

According to a member of Parliament (Interviewee 1), the use of brokers and intermediaries has been discouraged following a number of scandals. However, the MP stated that intermediaries now may appear take on the role of consultants on the procurement process.

A representative of the Austrian defence industry (Interviewee 3) stated that intermediaries are usually not used anymore. He also stated that defence companies at times require the help of consultants to understand the legal framework, processes and have timely translations of all relevant tender documents when bidding on defence contracts in other countries.

No evidence was found consultants working for a company being subject to special oversight – if they were to lobby decision makers, they would be required to register in a lobby register, in line with the Lobbying Act. The use and oversight of intermediaries is difficult to evaluate given the lack of transparency of the procurement system in Austria.

It appears that agents and intermediaries are used in the procurement cycle and that they may be subject to some control. The score has been selected on the basis of a lack of public information on the subject.

Researcher4187: No information on any financing packages surrounding major arms deals was found. A member of parliament (Interviewee 1) stated that procurement contracts are not made available to the defence committee due to secrecy provisions in those contracts. It appears likely that the same secrecy provisions the government includes in many procurement contracts also affect any financing packages.

It appears highly unlikely that details would be made available to the public under the current weak freedom of information legislation. It can thus be concluded that the details of finance packages are not publicly available and there is usually no information on whether a financing package exists at all.

Researcher4187: The Federal Procurement Defence and Security Act regulated the use of subcontractors but does not make any reference to anti-corruption programs and compliance systems . There appears there to be no requirement for main contractors to have specific anti-corruption procedures and policies in place as long as they do not violate the law. A representative of the Austrian defence industry (Interviewee 3) also stated that he was not aware of such requirements. He stated that many Austrian security companies have adopted compliance programs, because their main markets are abroad, and foreign governments often require such compliance programs.

There is no evidence that the government encourages the main contractor to ensure that its subsidiaries and sub-contractors adopt anti-corruption programmes. It is unclear if internal procurement guidance documents from the Ministry of Defence address the issue of anti-corruption programs, or if such details are included in signed contracts. These aspects cannot be verified as neither the contracts nor the procurement manuals are in the public domain.

Researcher4187: No indication was found in media reports that purchasing decisions are based on political pressure by other governments. According to data from the SIPRI database, Austria has procured military equipment from EU member states (both NATO members and non-NATO members like Sweden), from Switzerland, Israel and the United States over the past 15 years. A representative of the Austrian defence sector (Interviewee 3) stated that he was not aware of any recent cases or allegations of government defence purchases being influenced by foreign political actors, adding that, due to cutbacks, the army has not carried out any major procurements of late.

While no indications were found that arms procurement might be influenced by outside political pressure, media reports have suggested that a close cooperation between the Austrian military defence intelligence service BNA and the US service NSA might have influenced decisions on the construction and development of intelligence infrastructure, including the upgrade of a satellite surveillance station in 2013 or 2014 for an estimated EUR 150 million, including with equipment from US suppliers – at a time other parts of the army had to suffer through major cutbacks in the defence budget.

The bulk of evidence suggests that acquisitions are not driven by political influence. However there is insufficient evidence to state that procurement is consistently driven by military needs, also due to the fact that few major purchases have been made in recent years as a result of budget cutbacks.