There have been several attempts to introduce reforms to Lebanon’s Court of Accounts (CoA). The latest and most comprehensive was a bill that the government referred to Parliament via Decree no. 9458 of 4 December 2012. Parliament’s Administration and Justice Committee finished studying this bill on 5 September 2016. It was then referred to Parliament’s Finance and Budget Committee, where it has remained pending for more than eight years.

Below, we will conduct a critical reading of the bill as amended by the Administration and Justice Committee, evaluating its ability to overcome the challenges impeding the CoA and its conformity to international standards.

Is the Financial Judiciary Also Independent?

The first question that must be raised by any effort to reform an oversight or judicial body is whether it actually is independent and, most importantly, whether it enjoys independence guarantees. This question leads to other questions: Does the CoA encompass the principle of the separation of powers because of its financial justice functions? Does Article 20 of the Constitution, which enshrines the principle of judicial independence), apply to it for the same reason? What about the need for judicial independence affirmed by international charters (particularly Article 10 of the Universal Declaration of Human Rights)? Despite the priority of all these questions, the bill’s rationale section makes no mention of them. Subsequently, the bill avoids elaborating any holistic vision of reform. Remarkably, the Administration and Justice Committee’s report emphasized that the proposed amendments help to guarantee the CoA’s continued impartiality and administrative and financial independence, without elaborating a holistic vision in this regard.

The best evidence that the bill neglects this issue is the following:

Administrative Subordination to the Prime Minister’s Office

The bill keeps the CoA administratively linked to the Prime Minister’s Office, contrary to the foundational principles of the International Organization of Supreme Audit Institutions (INTOSAI). Consequently, the CoA’s budget would remain part of the budget of the Prime Minister’s Office, rather than separate. INTOSAI’s 1977 Lima Declaration of Guidelines on Auditing Precepts emphasizes that supreme audit institutions can only perform their tasks objectively and effectively if they are independent from the audited entities and free from external influence.

The bill also retains the power that the current law grants to the Council of Ministers to override a CoA decision to withhold prior approval from an administrative transaction. It thereby allows the Council of Ministers to proceed with illegal transactions despite CoA decisions.

Making matters worse, the bill is not drafted in the spirit of strengthening the principle of independence. It renders the auditing of institutions and associations connected to municipalities and municipality unions, public institutions, state-supported associations, and concession accounts contingent on the issuance of a decree by the Council of Ministers. This choice deprives the CoA of general jurisdiction, restricting it to the areas in which the executive branch decides to grant it jurisdiction.

Continued Functional Overlap Without Justifications or Controls

The bill retains the CoA’s power to deliver an opinion on financial matters and to pre-audit contracts and transactions. Consequently, the CoA would be called upon to deliver a prior opinion on, or decide whether to approve, many administrative transactions. It might then have to subject the same transactions to post-auditing, including judicial auditing.

The result is an overlap between the functions of the CoA and those of the public administrations, which runs counter to Principle 3 of the Mexico Declaration. This principle states that one of the essential requirements for supreme audit institutions to be independent is that they do not audit the policy of government or public entities but restrict themselves to auditing policy implementation. It is important, according to this declaration, that supreme audit institutions are not involved or seen to be involved, in any manner whatsoever, in the management of the entities they audit. In practice, delivering an opinion on the policy and conduct of governmental entities in a prospective or concurrent manner (i.e. pre-auditing or concurrent auditing) constitutes involvement in these entities’ decisions. The only exception mentioned in the declaration is cases in which the law specifically requires supreme audit institutions to audit policy, presumably due to the exigencies of public interest. Hence, if we assume that there is a need to retain pre-auditing due to the weak culture of accountability, a serious question still arises about whether preserving the CoA’s advisory role is appropriate, especially given the existence of many advisory apparatuses within the state’s public bodies (e.g. the State Council and the Legislation and Consultation Committee).

The overlap between the CoA’s work and the administration is increased by the fact that the law enables the Council of Ministers to override a CoA decision to withhold prior approval for any transaction, as mentioned earlier.

The CoA Council’s Lack of Independence Guarantees

The bill retains the same composition for the CoA’s Council, which is the equivalent of the Supreme Judicial Council when it comes to administering the financial judiciary’s affairs. This Council consists of the CoA’s president (as Council president), its public prosecutor, and its three highest-ranking chamber presidents. This composition grants the executive branch broad latitude to control the appointment of all the Council’s members, as all these figures are appointed by decree and can be appointed from among judges who do not even belong to the CoA. Moreover, the Council does not include any judge elected by the judges themselves. All the bill does is require the Council of Ministers to seek the CoA Council’s opinion when appointing chamber presidents, and this opinion is not binding whatsoever.

A Presidential System for Administering the CoA

The bill does reduce the authority of the CoA’s president. When it comes to discipline, it restricts investigation into disciplinary faults to the Judicial Inspection Authority. It also strips the CoA president of a monopoly over the power to call the CoA’s Council and Full Bench to convene. However, the bill retains other, more dangerous powers and adds new ones, thus preserving the system of presidential administration of the CoA and the subsequent risks of personalization and impingement on the financial judiciary’s internal and external independence. It thereby conflicts with the principles of judicial independence, as elaborated on by the Venice Commission in the opinion it issued on reforming the administrative judiciary on 19 March 2024. One of the most significant powers of the CoA president that the bill reaffirms is the ability to exercise the financial and administrative powers vested in a minister when it comes to administering the CoA. The most significant powers that the bill establishes for the CoA president are the power to distribute pre-auditing work or conduct it him- or herself and the power to single-handedly distribute controllers and auditors among the chambers and assign them any tasks he or she deems fit. This presidential system is made even more problematic by the absence of any mention of establishing an internal statute for the CoA, which would ensure the CoA’s internal transparency.

Insufficient Personal Safeguards

The same goes for the personal safeguards of the independence of judges. In this regard, the bill takes limited steps in certain realms, most importantly discipline, while neglecting other fundamental safeguards that are constant fixtures of the international judicial independence standards.

In the realm of discipline, the bill limits the power to investigate and the ability to issue referrals to the Disciplinary Council to the Judicial Inspection Authority. Under the current law, referrals are instead issued by the CoA Council based on a proposal by its president. As the CoA Council also participates in the judgment process, this current arrangement conflicts with the principle of separation between the power of prosecution and investigation and the power of judgment. On the other hand, the bill neglects to define disciplinary punishments based on proportionality to the gravity of the infraction or even to just emphasize the principle of proportionality in this regard.

From another angle, the bill neglects the principle that judges should not be moved between the CoA chambers without their consent. It does stipulate that their consent is required if they are being transferred to other administrations (i.e. outside the CoA’s cadre), which is self-evident as such transfers would in practice strip them of their judicial status. The bill also neglects to ensure judges’ rights to run for important positions, to exercise freedom of expression and assembly, and to litigate against all decisions that could infringe their individual rights.

What Fair Trial Exists Before the CoA?

The second extremely important issue is whether the CoA’s trial procedure conforms to fair trial principles and what legislative amendments are necessary to enforce these principles. Despite the priority of these questions, the bill’s rationale section does not raise them. Subsequently, the body of the bill offers no proposals in this regard.

The best evidence that the bill ignores this issue is the following:

The Continued Breach of the Principle of the Apparent Impartiality of the Financial Judge

Two procedures stipulated in the current CoA Regulation Law clash with the principle of the apparent impartiality of the judge. The first is the ability of the competent judicial bodies to spring into action spontaneously without any prior request. The second is the conducting of trials at two stages, the first of which involves the ruling bench issuing an interim decision without adhering to the principle of adversariality and, therefore, the right of defense.

The bill makes no amendment to these procedures. It retains the ability of a chamber to take action spontaneously in the context of conducting audits of officials, and it retains the two stages of ruling and the ability to issue an interim decision without any guarantee of prior adversariality.

The Continued Breach of the Principle of Trial Publicity

The current law contains no guarantees of the principle that trials should be public, and in actual practice, trials inside the CoA have adopted procedures that conflict with it. For example, the CoA does not hold sessions for oral arguments open to the public. Despite the importance of this principle, as mentioned by the Venice Commission in its aforementioned opinion, the bill remains silent in this regard.

Positive but Inadequate Additions Concerning the Principle of Explained Rulings

The bill makes a positive addition by affirming that rulings must be explained. It also adds that a judge’s dissent and its grounds must be recorded, and a separate report on the dissent must be drafted (the current law mentions nothing in this regard). On the other hand, the bill neglects the need for rulings to mention the reports prepared by the controllers and auditors commissioned by the chamber, as well as whether the rulings go against them one way or another and, if so, why. This practice marginalizes the role of controllers and auditors and limits cooperation and complementarity between the CoA’s various workers. It also weakens fair trial guarantees by undermining the guarantee of explanation and concealing key data available to the chamber that may have influenced its decision.

How Effective is the CoA in Light of INTOSAI Standards?

The third issue, which is just as important as the issues of judicial independence and fair trial, is the CoA’s effectiveness and ability to perform its role auditing public administrations – especially when it comes to the proper management and disposal of public resources – in light of the INTOSAI’s principles. A close examination of the bill’s content shows that it makes progress in strengthening some of the CoA’s work mechanisms, especially in terms of guaranteeing unrestricted access to information. However, the bill establishes no mechanism for following up on the implementation of its recommendations or institutionalizing the drafting of annual reports or programming of special reports.

Guaranteeing Unrestricted Access to Information

Principle 4 of INTOSAI’s Mexico Declaration stipulates the need to ensure unrestricted access to information. It states, “[supreme audit institutions] should have adequate powers to obtain timely, unfettered, direct, and free access to all the necessary documents and information, for the proper discharge of their statutory responsibilities”.

The bill takes significant steps in this regard. In addition to the means currently available to the CoA to obtain information, it assigns the task of exchanging information and documents related to prosecutions underway before the CoA, other judicial authorities, or any party with disciplinary power to the CoA’s Public Prosecution. Moreover, the bill explicitly includes, among the infractions that the CoA punishes, failure by the relevant authority to inform the CoA’s Public Prosecution of infractions, thereby deterring such authorities from concealing information from it.

Additionally, the bill entitles the CoA to view, besides the documents held by the audited administration, documents held by the entities contracted with the administration. It also allows controllers and auditors to conduct local audits of such entities at their premises. The penalty for noncompliance with these procedures is the same one that applies to officials who refuse to supply the CoA with requested documents.

The Absence of Mechanisms to Follow Up on Recommendations

Principle 7 of the Mexico Declaration stipulates that supreme audit institutions should have their own internal follow-up systems to ensure that audited entities properly address their observations and recommendations, as well as the observations and recommendations made by the legislature, one of its committees, or the auditee’s governing board. Despite the importance of establishing such a mechanism to ensure the effectiveness of CoA decisions, the bill contains no effort in this regard.

No Permanent Committee for Drafting Annual Reports and Programming

Principle 5 of the Mexico Declaration attaches particular importance to the “right and obligation” of supreme audit institutions to publish reports on their work and recommends that they “be required by law to report at least once a year on the results of their audit work”. In this regard, the bill reproduces the provisions of the current law, which require the CoA to draft annual reports and allow it to draft special reports, all as part of its powers of post-auditing. However, the bill ignores the fact that, in actual practice, the annually-required reports have transformed into occasional reports only issued and published years after the end of the year concerned. It also ignores the practices adopted for organizing special reports, which usually follow no plan or program of auditing priorities. Consequently, the bill neglects one of the best practices adopted by audit institutions, namely the establishment of a permanent special committee inside the institution for issuing annual reports and programming.

No Real Remedy for the Vacancies

Vacancies have constituted one of the main impediments to the CoA’s work, encompassing approximately 50% of the judicial positions. The vacancies reached this level because of the lack of any exam for entry into the Institute of Judicial Studies (IJS) since 1998 and the lack of any exam restricted to controllers since 2003. Despite the gravity of this situation, the bill contains no solutions to address it. Such solutions could include requiring that an exam for entry into the IJS be held annually (at least until the vacancies are filled), shortening the training periods, or requiring that an exam for controllers and auditors be held periodically.

How Can We Rehabilitate Controllers and Auditors?

A close examination of the conditions in the CoA shows that the role of controllers and auditors is somewhat marginalized in both auditing and judicial work. These workers are attached to judges or chambers by internal CoA procedures not regulated by law. The CoA’s chambers may follow or disregard the content of the reports drafted by the controllers and auditors, and they are not obligated to mention the content of these reports or explain why they went against the conclusions. The marginalization of controllers and auditors weakens their sense of belonging to the CoA and the complementarity that should exist between the roles of its various categories of workers. It also undermines the transparency of judicial decisions.

This article is an edited translation from Arabic.