GRECO has exposed corruption vulnerabilities in Luxembourg

The Council of Europe’s Group of States against Corruption (GRECO) has published its Sixth Evaluation Report on the prevention of corruption offences at local government level in Luxembourg. The Grand Duchy is traditionally regarded as one of the most transparent countries in the world; however, a detailed analysis has revealed significant vulnerabilities within local government bodies. The country lacks a unified national anti-corruption strategy, and no systematic risk assessment has yet been carried out at the municipal level. The real estate sector, where there is significant pressure on the housing market during the approval of general and specific development plans (PAG and PAP), and public procurement have been identified as the most vulnerable areas.

Experts are particularly concerned about the quality of oversight of public contracts. At the Luxembourg Ministry of the Interior, supervision of 100 municipalities, 70 inter-municipal associations and 30 public bodies is carried out by specialists whose combined workload is equivalent to 2.5 full-time positions. Checks on compliance with public procurement procedures are carried out exclusively on paper and by means of random sampling. Furthermore, the key advisory body — the Committee for the Prevention of Corruption (COPRECO) — meets only twice a year, has no public website, does not publish reports and does not include representatives of civil society or local authorities among its members.

The lack of strict regulations leads to high-profile breaches within local authorities. The report documents the case of an official from the municipality of Dudelange who, without management’s authorisation, provided paid consultancy services on school meals and childcare to nearly 30 other local authorities. He received payments and gift vouchers for this secondary employment, as a result of which the Luxembourg District Court sentenced him to an 18-month suspended prison sentence and a fine of €65,000.

In the commune of Hesperange, two employees have been found to have embezzled 5 million euros. The courts sentenced the guilty parties to prison terms, both actual and suspended, along with fines of up to €50,000 and the confiscation of assets worth more than €5 million. At the same time, the commune’s administration had long refused to make public the findings of an internal audit into this incident, publishing them only following a ruling by the Administrative Tribunal. Similarly, the City of Luxembourg refused for several years to provide a civil society organisation with documents relating to the safety of pedestrian crossings, yielding only after legal proceedings.

Bill No. 8052, which aims to introduce uniform rules of conduct for members of local authorities, is currently under consideration in the Luxembourg Chamber of Deputies. The bill provides for a ban on accepting gifts worth more than 150 euros, mandatory electronic declaration of property, and the establishment of a special ethics committee. Meanwhile, Bill No. 8218 is designed to expand citizens’ rights to participate in governance through live broadcasts of meetings and local initiative mechanisms.

In the area of whistleblower protection, a law was passed on 16 May 2023 and a specialised Office for Whistleblower Affairs (OSIG) was established within the Ministry of Justice. In 2024, the competent authorities received 547 reports and launched 328 investigations. However, the current system remains complex due to the existence of 22 different external reporting channels, the lack of a clear centralised body, and the fact that the burden of proving a causal link between the report and the dismissal lies with the employee themselves. In this regard, international experts have called on the national authorities in Luxembourg to simplify protection procedures and introduce regular external audits of all local authorities.