DECISION OF THE CONSTITUTIONAL CHAMBER OF THE SUPREME COURT OF THE KYRGYZ REPUBLIC

of April 11, 2014 No. 25-r

on the case of check of constitutionality of paragraph two of part 2 of article 5 of the Law of the Kyrgyz Republic "About the republican budget of the Kyrgyz Republic for 2013 and the forecast for 2014-2015" and paragraph two of part 2 of article 5 of the Law of the Kyrgyz Republic "About the republican budget of the Kyrgyz Republic for 2014 and the forecast for 2015-2016" in connection with representation of the Government of the Kyrgyz Republic.

The constitutional chamber of the Supreme Court of the Kyrgyz Republic in structure:

the chairman - the judge Kasymaliyev M. Sh., Aydarbekova Ch. A. judges., Bobukeeva M. R., Makeshov J. M., Mamyrov E. T., Narynbekova A. O., Oskonbayeva E. Zh., Osmonova Ch. O.,

in case of Iliyazova N. A. secretary.,

with participation of the addressing party - the representative of the Government of the Kyrgyz Republic Lavrova O. V. by proxy,

being guided by parts 1, of 6, of 8, of the 9 and 10 article 97 of the Constitution of the Kyrgyz Republic (further - the Constitution), Articles 4, of 18, of 19, 37 and 42 constitutional Laws of the Kyrgyz Republic "About the Constitutional chamber of the Supreme Court of the Kyrgyz Republic", considered in proceeding in open court case on check of constitutionality of paragraph two of part 2 of article 5 of the Law of the Kyrgyz Republic "About the republican budget of the Kyrgyz Republic for 2013 and the forecast for 2014-2015" and paragraph two of part 2 of article 5 of the Law of the Kyrgyz Republic "About the republican budget of the Kyrgyz Republic for 2014 and the forecast for 2015-2016".

Reason for consideration of the case was representation of the Government of the Kyrgyz Republic (further - the Government).

The basis to consideration of the case was the found uncertainty in question of whether there correspond Constitutions of the Kyrgyz Republic (further - the Constitution) the regulations of the laws of the Kyrgyz Republic disputed by the applicant "About the republican budget of the Kyrgyz Republic for 2013 and the forecast for 2014-2015" and "About the republican budget of the Kyrgyz Republic for 2014 and the forecast for 2015-2016".

Having heard speech of the judge-speaker Bobukeeva M. R. who was carrying out preparation of case for judicial session and having researched the provided materials, the Constitutional chamber of the Supreme Court of the Kyrgyz Republic

Established:

In the Constitutional chamber of the Supreme Court of the Kyrgyz Republic (further - the Constitutional chamber) idea of the Government of recognition of paragraph two of part 2 of article 5 of the Law of the Kyrgyz Republic "About the republican budget of the Kyrgyz Republic for 2013 and the forecast for 2014-2015" unconstitutional and contradicting part 3 Articles 5, of part 9 of Article 74, of part 2 of article 76 of the Constitution arrived on October 9, 2013.

As it is specified in representation of the Government, according to the paragraph to the second part 2 of article 5 of the disputed Law, planning of capital investments from the republican budget shall perform the Ministry of Finance of the Kyrgyz Republic (further - the Ministry of Finance) and to send to Jogorku Kenesh of the Kyrgyz Republic (further - Jogorku Kenesh) on approval of special-purpose committee in expanded format.

According to the Government, this regulation expands powers of committee of Jogorku Kenesh, contrary to the restrictions set by the Constitution. So, article 3 of the Constitution, establishing the principle of separation of the government, provides that state bodies represent and perform the government within the powers established by the Constitution. The government notes that it regarding 3rd article 5 of the Constitution is determined that the state, its bodies, local government bodies and their officials cannot be beyond the powers determined by the Constitution and the laws.

The addressing party notes that according to part 9 of article 74 of the Constitution, the Jogorku Kenesh performs the powers provided by the Constitution. At the same time, preparation and preliminary consideration of the questions carried to powers of Jogorku Kenesh according to part 2 of article 76 of the Constitution, is assigned to committees of Jogorku Kenesh. Control of execution of the laws and decisions adopted by Jogorku Kenesh is also assigned to them.

Due to the above the Government considers that the disputed regulation breaks the principle of separation of the government, allows intervention in the solution of questions of executive branch of the power, thereby breaking the system of controls and counterbalances installed by the Constitution.

Representation of the Government was accepted determination of board of judges of the Constitutional chamber of November 1, 2013 to production.

On January 13, 2014 the Government made to the Constitutional chamber addition to the above-named idea of recognition unconstitutional paragraph two of part 2 of article 5 of the Law of the Kyrgyz Republic "About the republican budget of the Kyrgyz Republic for 2014 and the forecast for 2015-2016". The arguments given in reasons for the additional requirement are similar to the arguments containing in earlier brought representation in view of analogousness of the disputed regulations.

In judicial session the addressing party supported the representation and asked it to satisfy.

Representatives of the defendant party on meeting were not for the disrespectful reasons. However in case papers there is written objection reflecting line item of Jogorku Kenesh on case in point. From content of objection it is visible that the defendant party does not agree with arguments of the addressing party and asks to leave representation of the Government without satisfaction on the following bases.

By part Items 2 and 5 2, of part 3 of article 74 of the Constitution it is determined that the Jogorku Kenesh adopts the laws, approves the republican budget and the report on its execution.

The defendant party notes that according to part 2 of article 13 of the Constitution the procedure for forming, acceptances, execution of the republican budget, and also audit of their execution is determined by the law. Proceeding from the specified regulations, the Jogorku Kenesh adopted the laws on the republican budget for the corresponding years where it determined procedure for execution of the republican budget.

According to article 76 of the Constitution committees of Jogorku Kenesh perform preliminary consideration of the questions carried to powers of Jogorku Kenesh, control carrying out in life of the laws and the decisions made by Jogorku Kenesh. According to Item 19 of part 1 of article 29 of the Law of the Kyrgyz Republic "About Regulations of Jogorku Kenesh" committees of Jogorku Kenesh on the questions carried to its maintaining consider other questions provided by the specified law and other regulatory legal acts.

According to representatives of the defendant party, the special-purpose committee of Jogorku Kenesh can consider procedure for execution of the republican budget, and also control carrying out in life of the law on the republican budget. According to article 88 of the Constitution the Government provides, but does not perform carrying out financial, price, tariff, investment and tax policy.

The defendant party also pays attention that according to article 85 of the Constitution and article 32 of the constitutional Law of the Kyrgyz Republic "About the Government of the Kyrgyz Republic" the Government is accountable to Jogorku Kenesh in the limits provided by the Constitution.

According to representatives of Jogorku Kenesh, preliminary approval of the list of objects for capital investment of special-purpose committee is form of interaction of the Government and Jogorku Kenesh which minimizes in the future disagreements and questions of Jogorku Kenesh to the Government in case of assessment of the performance report of the republican budget. The constitutional chamber, having researched case papers and having discussed arguments of the parties, comes to the following conclusions:

1. According to part 4 of article 19 of the constitutional Law of the Kyrgyz Republic "About the Constitutional chamber of the Supreme Court of the Kyrgyz Republic" the Constitutional chamber takes out acts in the subject mentioned in the address only concerning that part of regulatory legal act which constitutionality is called in question.

Thus, subject of consideration of the Constitutional chamber of this case are:

- paragraph two of part 2 of article 5 of the Law of the Kyrgyz Republic "About the republican budget of the Kyrgyz Republic for 2013 and the forecast for 2014-2015" the following content:

"To perform planning of capital investments from the republican budget the Ministry of Finance of the Kyrgyz Republic and to send in Jogorku Kenesh of the Kyrgyz Republic for approval of special-purpose committee in expanded format. To perform planning of capital investments from local budgets executive bodies of local self-government.";

- paragraph two of part 2 of article 5 of the Law of the Kyrgyz Republic "About the republican budget of the Kyrgyz Republic for 2014 and the forecast for 2015-2016" the following content:

"Planning of capital investments from the republican budget is performed by the Ministry of Finance of the Kyrgyz Republic, in coordination with special-purpose committee of Jogorku Kenesh of the Kyrgyz Republic in expanded format, and planning of capital investments from local budgets - executive bodies of local self-government.".

The law of the Kyrgyz Republic "About the republican budget of the Kyrgyz Republic for 2013 and the forecast for 2014-2015" of February 1, 2013 No. 10 is published in the Erkin Too newspaper of February 5, 2013 No. 8.

The law of the Kyrgyz Republic "About the republican budget of the Kyrgyz Republic for 2014 and the forecast for 2015-2016" of December 30, 2013 No. 227 is published in the Erkin Too newspaper of December 31, 2013 No. 104.

The specified regulatory legal acts are adopted according to the procedure established by the legislation of the Kyrgyz Republic entered in the State register of regulatory legal acts of the Kyrgyz Republic and are acting.

2. According to Item 2 of article 3 of the Constitution the government in the Kyrgyz Republic is based on the principle of separation of the government into legislative, executive and judicial branches of the power.

This principle assumes establishment of such system of legal guarantees, controls and counterbalances which excludes possibility of concentration of the power at one of them, provides independent and independent implementation of all branches of the power and at the same time their interaction and their mutual equilibration therefore separation of the authorities is based on natural separation of such functions as lawmaking, public administration and justice.

As this principle is the fundamental principle of the organization of the government, strict following to the established areas of jurisdiction and powers is the key to coordination of functioning of the state in general.

3. The constitutional bases of legal regulation of the public relations in the budget sphere are enshrined in article 13 of the Constitution and have the determining value. According to part 2 of article 13 of the Constitution the procedure for forming, acceptance, execution of the republican budget is determined by the law. The republican budget is accepted by also separate law. Thereby, proceeding from sense and content of the specified constitutional regulations, regulation of the budget relations is performed by means of development of the constitutional bases in the current budget legislation. The constitution contains the concentrated normative expression of the budget and legal beginnings. According to Item 6 of part 1 of article 88 of the Constitution on the Government development and submission of the republican budget to Jogorku Kenesh, and is assigned to Jogorku Kenesh, according to Item 5 of part 2 of article 74 of the Constitution - its approval.

It should be noted that the Constitution cannot and shall not aim at comprehensive detailed regulation of budget process as the essence of the Fundamental law is mainly expressed in its stability and long term. For this reason part 2 of article 13 of the Constitution provides that the procedure for forming, acceptances, execution of the republican budget, and also audit of its execution is determined by the law.

Provisions of article 13 of the Constitution are realized in the Law of the Kyrgyz Republic "About the basic principles of the budget right in the Kyrgyz Republic" which determines the fundamental principles of forming and execution of the republican budget. By means of similar legislative regulation definiteness, stability and succession not only budget legal relationship, but also legal status of their subjects are reached.

Proceeding from sense and contents of the Law of the Kyrgyz Republic "About the basic principles of the budget right in the Kyrgyz Republic" budget process represents set of the interconnected stages and procedures covering all its stages from project development of the republican budget before adoption of law on approval of the report on its execution. This process consists of the following consecutive stages: 1) creation of the draft of the republican budget by the Government and its entering into Jogorku Kenesh; 2) consideration of the bill of the republican budget by Jogorku Kenesh and its approval; 3) execution of the republican budget by the Government; 4) approval of the performance report of the republican budget by Jogorku Kenesh.

Such sequence of budget process cannot be changed as at each stage issues which cannot be resolved in other time are resolved. At each stage of budget process activities of public authorities and their power as participants of budget process, it is regulated by the Constitution and the laws.

Creation of the draft of the republican budget and its entering into Jogorku Kenesh (as the first stage of budget process) is exclusive prerogative of the Government, stipulated in Item 6 parts 1 of article 88 of the Constitution and article 2 of the Law of the Kyrgyz Republic "About the basic principles of the budget right in the Kyrgyz Republic". The draft of the republican budget is constituted by the Government within budget classification, taking into account its income and expenses. According to the specified classification the funds allocated for capital investments are one of expenditure items of the republican budget (article 14 of the Law). The government within forecasting of the medium-term budget shall consider, including budget expenses in reserve of primary groups of expenses with allocation of current expenses where expenses on capital investments also enter. It should be noted that mid-term forecasting of the budget represents the management tool public finances allowing the Government to have idea of future amounts of resources for the purpose of planning of the forthcoming expenses in general and on each industry, accurately to determine priority activities of the state, especially regarding priority investment projects (article 9 of the Law).

Result of this stage is approval by the Government of the bill on the republican budget for the next fiscal year and its entering into Jogorku Kenesh.

The second stage of budget process - consideration and approval of the bill on the republican budget by Jogorku Kenesh.

According to article 70 of the Constitution the Jogorku Kenesh is the supreme representative body performing legislature and control functions within the powers. According to Item 5 of part 1 of article 74 of the Constitution the Jogorku Kenesh approves the republican budget and the report on its execution. Committees as permanent working bodies of Jogorku Kenesh, according to article 76 of the Constitution, perform preparation and preliminary consideration of the questions carried to powers of Jogorku Kenesh, control carrying out in life of the laws and the decisions made by Jogorku Kenesh. The relevant committee, within the specified powers, studies the bills introduced in Jogorku Kenesh, considers and draws the conclusion.

The bill on the republican budget is considered by all committees which represent the conclusions on it. In turn the responsible (profile) committee on the basis of these documents prepares the consolidated conclusion and submits the bill on the republican budget for consideration of Jogorku Kenesh. The Jogorku Kenesh according to the established law procedure adopts the law on the republican budget for the next fiscal year and the forecast for two next years.

At this stage the main role belongs to Jogorku Kenesh as the subject of budget process which budget powers are determined on the basis of the constitutional principle of separation of the authorities and are based on its exclusive right to adopt the laws. At the same time committees of Jogorku Kenesh cannot act as independent subjects of budget process.

The third stage of budget process is budget implementation. Ensuring execution of the republican budget is assigned to the Government, according to Item 6 of part 1 of article 88 of the Constitution.

This stage of budget process includes accomplishment of profitable and account parts of the budget.

The most important task of budget implementation - ensuring complete and timely receipt of taxes and other payments in general and on each source, and also financing of actions within the amounts approved for the budget and within that financial year, on which the approved budget.

According to Item 5 of part 1 of article 88 of the Constitution the Government provides carrying out financial policy which component is development and execution of the republican budget. This function is inherent only in the Government and is implemented through the Ministry of Finance. With respect thereto the legislator assigned to the Ministry of Finance, according to the Law of the Kyrgyz Republic "About the basic principles of the budget right in the Kyrgyz Republic", planning feature of capital investments from the republican budget (article 20 of the Law).

Respectively, the reconciliation procedure of planning of capital investments established by the legislator from the republican budget with special-purpose committee of Jogorku Kenesh cannot be performed at stage of execution of the law on the republican budget. Investment of special-purpose committee with the power provided by the disputed legislative provisions at this stage of budget process is intervention in activities of the Government for execution of the republican budget that contradicts part 3 of article 5 of the Constitution and breaks the principle of separation of the government (Item 2 of article 3 of the Constitution).

The fourth stage of budget process - creation of the performance report of the republican budget and its approval. According to article 45 of the Law of the Kyrgyz Republic "About the basic principles of the budget right in the Kyrgyz Republic" the Government on behalf of the Ministry of Finance constitutes the performance report of the republican budget. After creation of the report the Government represents the bill on approval of the performance report of the republican budget to Jogorku Kenesh.

The Jogorku Kenesh within powers, stipulated in Item 5 parts 2 of article 74 of the Constitution, approves the performance report of the republican budget for previous year. Thus, the Constitution accurately determined powers of the Government and Jogorku Kenesh on each of stages of budget process, proceeding from the principle of separation of the government.

4. In reasons for the arguments the defendant party considers that consent of special-purpose committee of Jogorku Kenesh on planning of capital investments from the republican budget is form of parliamentary control of carrying out in life of the laws and the decisions made by Jogorku Kenesh. However the essence of parliamentary control consists in check of execution of the adopted law which does not assume any subsequent approval regarding execution of the adopted law.

Parliamentary control, being one of the leading types of the state control, along with legislative function of parliament, it shall be performed without intervention in direct executive activities of executive bodies.

Proceeding from sense and contents of the Constitution, limits of parliamentary control shall lie where powers of the main activities of system of the executive authority with which to interfere, according to the principle of separation of the authorities begin, the legislature has no right. The understanding of the importance of accurate establishment of limits of parliamentary control promotes the organization of relations of legislative and executive branches of the power in the state on the basis of the principle of separation of the authorities.

It should be noted that the law on the republican budget is specific regulatory legal act which reflects the financial plan of the country for a certain period of time. If the precepts of law which are usually accepted by the legislator are calculated for vaguely long term and are effective until their cancellation or replacement with others, then the laws on approval of the budget keep the legal force only within the corresponding fiscal year. After this term they automatically lose the force and cannot be applied. Articles disputed regarding constitutionality, establish general regulations which action is not limited one fiscal year and are, strictly speaking, atypical for such acts. Therefore, their legal place not in acts of approval of the annual budget, and in other regulatory legal acts. At the same time, such regulations shall not concern stage of execution of the republican budget.

Considering the above, it is possible to state that the legislator, granting the right to special-purpose committee in expanded format to agree on issues of planning of capital investments from the republican budget at stage of execution of the republican budget, was beyond the constitutional establishments, regarding differentiation of functions and powers of public authorities (item 4 of Article 3, part 3 Articles 5, Article 13, part 9 of Article 74, part 2 Articles 76, Item 6 of part 1 of article 88 of the Constitution).

Based on the above, being guided by Item 1 of part 6 of article 97 of the Constitution of the Kyrgyz Republic, Articles 42, of 47, of 48, 51 and 52 constitutional Laws of the Kyrgyz Republic "About the Constitutional chamber of the Supreme Court of the Kyrgyz Republic", the Constitutional chamber

Solved:

1. Recognize paragraph two of part 2 of article 5 of the Law of the Kyrgyz Republic "About the republican budget of the Kyrgyz Republic for 2013 and the forecast for 2014-2015" and paragraph two of part 2 of article 5 of the Law of the Kyrgyz Republic "About the republican budget of the Kyrgyz Republic for 2014 and the forecast for 2015-2016" contradicting the Constitution of the Kyrgyz Republic.

2. Final this decision and to appeal is not subject, becomes effective from the moment of declaration.

3. This decision is obligatory for all state bodies, local government bodies, officials, public associations, legal entities and physical persons and is subject to execution in all territory of the republic.

4. Publish this decision in official publications of public authorities, on the official site of the Constitutional chamber and in "The bulletin of the Constitutional chamber of the Supreme Court of the Kyrgyz Republic". 

Chairman

M. Kasymaliyev

Judges:

Ch. Aydarbekova M. Bobukeeva D. Makeshov E.Mamyrov A. Narynbekova E.Oskonbayev Ch. Osmonova

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