Legislation: Nicaragua has ratified the United Nations Convention against Corruption (UNCAC) in 2006 and the Inter-American Convention Against Corruption in 1999. Nicaragua has a well-developed legislative framework criminalising acts of corruption. The Penal Code (in Spanish) and Law No. 581 of 2006 cover all relevant aspects of corruption, including bribery, embezzlement, extortion and money laundering. This has led Global Integrity 2008 to assess the Nicaraguan anti-corruption legal framework as 'very strong'. However, many legal inadequacies remain, such as in the field of whistleblower protection, public procurement and political financing. According to Transparency International Global Corruption Report 2009, an Access to Information Law (in Spanish) came into force in December 2007. It requires institutions that receive or oversee state funds, to make their documents publicly available, giving citizens the possibility to play an oversight role in relation to public expenditure and administrative decisions. The passing of the Information Law indicates a positive sign of increasing access to information initiatives in the country. Nevertheless, not all public institutions follow this law and publish their documents. The legal provisions are further hampered by the weak and corrupt judicial system whose decisions are often influenced by political interests. Observers have pointed to two major legal obstacles in the fight against corruption in Nicaragua: 1) Members of Parliament and of the government enjoy blanket immunity, which makes investigating and prosecuting cases of corruption extremely difficult, and 2) the electoral law does not limit individual or corporate donations to political parties, while there is no control or monitoring of expenditures of political parties. These problems increase the possibility for embezzlement of public funds and for corrupt deals between politicians and the private sector. Political parties are not required to keep financial records of donations, and the major political actors have shown little interest in reforming the current system. In general, there is a significant implementation gap between the well-developed legislation to combat corruption and lack of enforcement of this legislation. This also applies to laws and rules anchored in the constitution, such as the article aimed at resolving conflicts of interests and the article aimed at securing public officials' declaration of assets. A tradition of gift-giving reportedly prevails within the administration and the absence of any efficient follow-up mechanism on the declaration of assets makes it difficult to root out corruption in the Nicaraguan civil service. Access the Lexadin World Law Guide for a collection of legislation in Nicaragua.

Government Strategies: The Inter-American Convention Against Corruption provides a relatively comprehensive international framework for fighting corruption. A follow-up mechanism (MESICIC), operating since 2001, reviews whether states are introducing effective measures to fight corruption in line with the convention. This imposes direct obligations on the Government of Nicaragua to adopt institutional and legal measures against corruption. The 2006 MESICIC report points towards several deficiencies in the existing legal-institutional framework of Nicaragua. On another front, the Compact to Promote Transparency and Combat Corruption was signed in June 2004 between the Nicaraguan government and G8 countries. Subsequently, the G8 has been providing technical assistance to the Nicaragua to improve public budgets and financial management. The compact defines six laws as 'priority legislative agenda items' for the government that, if successful, may have comprehensive impacts. First, the Public Service Ethics Law will govern the ethics of public employees during their term in office and will require that civil servants declare their assets before assuming office. Second, the Judicial Career Law will ensure a merit-based, competitive and transparent process for selecting judicial officials, as well as provide for disciplinary sanctions (see more on the Judicial Career Law under 'Judiciary' in the 'Corruption Levels' section). Third, the Reforms to the State's Contracting Law will make government procurement more cost-efficient and transparent. Fourth, the Fiscal Responsibility Law will seek to limit public debt to levels that are prudent and compatible with tax revenues and public assets, adopt a stable and predictable tax policy, establish a multi-year budgetary planning framework, adopt international public sector accounting standards, and create a fiscal stabilisation fund. Fifth, the Public Sector Financial Management Law will aim at establishing standards to regulate and coordinate the financial management system. Lastly, the Freedom of Information Law will include the right of citizens to access information about government officials and private companies that perform public functions (e.g. water and energy companies). For further information, read the compact between G8 and the Government of Nicaragua.

Anti-Corruption Agencies: The Oficina de Ética Pública (Public Ethics Office, OEP) was established to promote transparency and efficiency in public administration. The mandate of the OEP derives from the executive authority of the President. The office also administers the Programa de Eficiencia y Transparencia en las Compras y Contrataciones del Estado (Efficiency and Transparency in Public Procurement and Contracting Programme). Donors have confidence in the OEP, and the office is implementing and providing follow-up in Nicaragua to the Inter-American Convention Against Corruption. According to Global Integrity 2008, however, it does not have the authority to carry out investigations nor prosecution. The government is seen as politicising all anti-corruption agencies in the country.

Procuraduría General de la República (PGR): The PGR (General Prosecutor) is, together with the Oficina de Ética Pública, in charge of implementing the Inter-American Convention Against Corruption, as well as formulating national anti-corruption strategies and priorities. Furthermore, the Procuraduría has established an Office for Complaints of Corruption, where citizens can file complaints of inappropriate behaviour by civil servants (see 'Whistle-Blowing' below). Global Integrity 2008 evaluates the real independence of the institution as non-existent and states that political influence ranges from the appointment of affiliates to the ruling party to pressure to waive investigation in particular cases. Read more about the Procuraduría's priorities in the fight against corruption.

Contraloría General de la República: The Contraloría General de la República (Comptroller's Office) is a formally independent entity whose Consejo Superior (High Council) of 5 members and 3 alternates is elected by the National Assembly. The unit is the prime watchdog for control of the public administration and undertakes financial audits of public institutions. The office has a mandate to initiate independent investigations, but it rarely uses this power. According to Global Integrity 2008, there are allegations that the Office of the Contraloría General is effectively controlled by the two major political parties, the PLC and FSLN, who are said to nominate members of the Consejo Superior on the background of political affiliation rather than on merit. Several investigations of corruption cases involving high-level politicians are believed to have been prevented due to the power sharing of the Office of the Contraloría General. The work of the Contraloría General is also hampered by the fact that President Ortega's government is managing 2 budgets: the official and legally approved budget and a budget with funds from Venezuela as a part of the ALBA agreement. The second type of budget is administered according to the executive's discretion and is not subject to review.

Ombudsman's Office: The Ombudsman Law 212 establishes an independent Ombudsman Office. However, according to Global Integrity 2008, the Ombudsman is under strong political influence. It does not have authority to initiate investigations unless a case does not involve politics, and selective investigations are common. Moreover, the Ombudsman’s Office does not receive regular funding, and foreign donors have withdrawn their aid due to its lack of independence and professionalism. According to the same source, the Ombudsman’s Office has been criticised for its wilful blindness on some questionable cases, and the government rarely acts on its findings. Citizens are not able to access specific reports except annual global reports and statistics, the law stipulates that only affected parties are allowed to access these reports. Hence, Global Integrity 2008 assesses the Ombudsman’s Office in Nicaragua as ‘very weak’.

E-Governance: E-governance is still developing in Nicaragua and a commission, the Comisión para el Foro Permanente de Gobierno Electrónico (GOBeNIC), has been established to take responsibility for developing and implementing plans for e-governance in the country. The Ministry of Development, Industry and Trade operates the Ventanilla Unica de Inversiones, a one-stop shop that provides investment and business licensing information to foreign and domestic investors. Besides providing information, the Nicaraguan government claims that this one-stop shop has reduced the average time for registering a business. Furthermore, two non-profit, public-private institutions host websites that provide relevant information to foreign investors. The Nicaraguan Investment Promotion Agency operates ProNicaragua, through which investors may find useful information on investment opportunities, commercial partners and commercial dispute resolution. Also, the Export Promotion Centre (CEI) operates NicaExport that provides relevant information for exporters.

Public Procurement: Nicaragua signed the Dominican Republic Free Trade Agreement (CAFTA-DR) which came into force in 2006. The CAFTA-DR set up rules to ensure the fairness and transparency in procurement procedures. Procurement procedures are provided in the Government Procurement Law and the Municipal Procurement Law such as open bidding and qualified bidding. According to Transparency International Global Corruption Report 2009, the Municipal Procurement Law gives municipalities autonomy in acquisition procedures and freedom to decide whether to offer a tender for the purchase of goods and services. However, procurements between municipalities or with state institutions are excluded from the Municipal Procurement Law, since they are covered by the Government Procurement Law. According to Global Integrity 2008, cronyism and nepotism are addressed in the law, and open tendering is required when procurements are over USD 100,000. Companies violating the procurement regulations are prohibited from participating in future biddings under the Procurement Law, however, in reality, the implementation is weak. No cases of companies being sanctioned have been reported despite of media investigations into alleged violations and public denouncements. According to the US Commercial Service 2010, favouritism exists in state-funded projects where contracts are regularly rewarded based on political connections. In 2006, the Government of Nicaragua established the Sistema de Contrataciones Administrativas del Estado (SISCAE), which is a portal for public contracts through which investors may register, obtain information and bid on public contracts. Hence, Global Integrity 2008 assesses the procurement system in Nicaragua as ‘weak’. The Government Procurement Law was amended in 2010, to eliminate many ambiguities and loopholes that allowed favouritism and unfair competition to take place. Its effectiveness is yet to be determined.

Whistle-Blowing: La Procuraduría General de la Republica set up an Office for Complaints of Corruption in January 2006, where citizens can report on corruption, financial fraud and other offences that are against the state. However, according to Global Integrity 2008, the results have been meagre and the office rarely receives complaints. It is widely believed that the low number of reports can be traced back to the insufficient protection of whistleblowers in Nicaragua. No specific whistleblower protection law is in place, and such protection is not offered by other legislation. The absence of whistleblower protection reduces individuals' incentives to report cases of corruption, as they fear retaliation. Hence, Global Integrity 2008 assesses whistle-blowing measures in Nicaragua as 'very weak'.

General Comments on the Public Anti-Corruption Initiatives: Many anti-corruption initiatives were declared during the presidency of Bolaños. However, the majority of these initiatives have been ineffective due to the politicisation of the institutions in charge of implementing and enforcing them. For example, the Office of the Contraloría General, which should be a key actor in the fight against corruption and has the mandate to undertake independent investigations of alleged corruption cases involving public officials, lacks independence from political influence. Hence, any truly effective campaign and investigation is inevitably only conducted on a selective basis. Many of the institutions that should exert checks and balances on public institutions suffer from this kind of political control, which impedes the introduction of reforms. Consequently, Nicaragua is facing an enormous implementation gap in the fight against corruption. The ALBA cooperation between Central American countries has brought new funds to Nicaragua; however, due to the missing control over spending, it has also provided high-ranking government officials with increased opportunities to embezzle public funds. Another pressing issue is the law of immunity: Members of Parliament and of the government enjoy blanket immunity from investigations and prosecutions, which eliminates much of the impact that could be derived from other legal anti-corruption initiatives.