A/HRC/19/42 34. Finally, it is remarkable that such transparency measures seem consistent with the commitments endorsed by both developed and developing countries in point 24 of the Accra Agenda for Action.33 B. The impact on the rule of law in the country of origin 35. Beyond the relationship between available economic resources and human rights obligations, the non-repatriation of funds of illicit origin has an impact on the rule of law in the country of origin. As recalled by Council resolution 17/23 mandating this study, “the illicit acquisition of personal wealth can be particularly damaging to democratic institutions, national economies and the rule of law”. 36. Where both the incentives for and opportunities to export illicit wealth are significant, as it seems to be the case in many developing countries, it is very likely that the damage to the rule of law be exacerbated. It has been pointed out that “the potential to hide illicit capital securely in tax havens is a direct stimulus to corruption and other illicit activities like transfer mispricing. It decreases the chances of detection and therefore increases the likely returns. Especially in polities characterized by high degrees of socioeconomic inequality and little or no effective institutionalized popular control of the actions of political elites (“democracy”), those fractions of the political elite that are able and willing to participate in this nexus of corrupt internal accumulation and illicit capital outflows are also motivated or able to create or change the rules of the game, in order to ensure that they can continue playing it in a rewarding way. In practice this is likely to mean: tax agencies collect enough money to run basic government services but have overall low capacity, especially in dealing with complex international issues like transfer pricing; police services lack investigatory powers; court systems are vulnerable to corruption; weak public audit offices lack independent authority; legislatures lack collective cohesion and authority; fragile, unstable political parties are motivated by money and patronage; and public services lack a collective, professional ethos. Indirectly, these processes may further weaken the protection of property rights through their incentive effects on political elites. Powerful groups that control considerable (illicit) capital but locate much of it overseas do not have strong incentives to strengthen property rights at home (for everyone)”. 34 37. In other words, the opportunities to export funds of illicit origin generate perverse incentives against building a democratic society. The non-repatriation of funds of illicit origin increases the conditions leading to this kind of institutional damage. By requiring obligations to both countries of origin and recipient countries, a human rights-based approach to the asset recovery process contributes to remedying that negative impact. C. How a human rights-based approach to the asset-recovery process contributes to reducing the negative impact of non-repatriation 38. The relevant role that recipient countries play in the asset-recovery process should not only be associated with the fact that the assets are located within their jurisdiction, but also that, regardless of the capacities, resources and willingness of the requesting State’s institutions and authorities, there is a victim society suffering the consequences of public corruption. An important number of the barriers to asset recovery that were outlined above in chapter II are a consequence of insufficient understanding of this reality. By focusing on 33 34 10 Designed to strengthen and deepen implementation of the Paris Declaration on Aid Effectiveness. 3rd High Level Forum on Aid Effectiveness, 2008, Accra, Ghana. Moore, cited in note 32 above.

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