In September 2021, new elections were just around the corner, but there was no agreement between the government and the opposition.
Even though the ruling Serbian Progressive Party (SNS) had won more than two-thirds of parliament seats in the parliamentary elections a year earlier, there was still uncertainty surrounding their legitimacy due to the opposition’s boycott.
The European Parliament sent four mediators to help both the ruling and opposition parties resolve the crisis.
However, the opposition was not satisfied with the document that was the result of the subsequent dialogue. Towards the end of January 2022, just two months before the elections, the European Parliament’s mediators held a press conference.
One of them, Knut Fleckenstein, said they had not come “to protect” the government or advocate for the opposition, but to help move the dialogue forward.
However, the Center for Investigative Journalism of Serbia (CINS) can now reveal that a company where Knut is a partner had business ties with the Serbian Progressive Party that year.
According to CINS’s investigation, in 2022, SNS paid just under 40,000 EUR for consulting services to a German company where Fleckenstein was a partner. Mickaël Roumegoux Rouvelle, an analyst at Transparency International’s German branch, says that this case raises suspicions because Fleckenstein was the European Union’s representative in the dialogue between 2019 and 2022.
“If he provided consulting services to SNS in 2021 and 2022 or was involved in obtaining a consulting contract for his company, that is a conflict of interest.”
In its financial report, SNS listed this expense as training for its members, the investigation has also revealed. This item does not have to contain detailed information, so citizens cannot see where that money is going and for what exact purpose. CINS discovered another company with which SNS collaborated that year. It is a London-based company with ties to the UK Conservative Party, and one of its owners boasted of having worked on campaigns for Boris Johnson.
Public dialogue, confidential contract
On the prestigious Neuer Wall street in the heart of Hamburg, Germany’s second-largest city, there are shops of the world’s most famous brands. In the shop windows, passersby can see new models of Louis Vuitton, Prada, and Hermes, among others.
Next to one of those shops is the headquarters of the company Beust&Collegen International. As stated on its website, the company, among other things, advises German companies in international activities by bringing them closer to politicians, authorities, and potential partners. It is owned by a company whose co-founder is the former mayor of Hamburg, Ole von Beust.
The official website of the company that owns Beust&Collegen International states that they take on new clients based on recommendations and that they refuse to represent companies or institutions significantly influenced by countries where the rule of law is not enforced.
The contract that this company signed with the Serbian Progressive Party is worth about 40,000 EUR. With the help of a German colleague, CINS attempted to schedule an interview with representatives of Beust&Collegen International. However, they did not agree because, as they responded in an email, their contract obliges them to maintain confidentiality. They briefly mentioned the topic of cooperation with SNS.
“Our job involved strategic advice regarding negotiations for Serbia’s EU accession and finding the most important stakeholders in the process,” according to their response.
They cooperated with SNS in 2022, the very year when one of the company’s partners, former German politician and Member of the European Parliament Knut Fleckenstein, was among the mediators in the dialogue between the government and the opposition on electoral conditions.
We did not manage to find out why Fleckenstein was chosen as a mediator by the European Parliament because they did not respond to our questions, but instead referred us to general regulations. They also refused to provide us with documentation or correspondence related to the dialogue process.
Knut Fleckenstein also did not want to speak to CINS.
Even if Fleckenstein was involved in his company’s dealings with SNS, Mickaël Roumegoux Rouvelle, an analyst at the German branch of Transparency International, says he did not formally violate any rules. At that time, according to him, former MPs could engage in lobbying or represent others’ interests immediately after leaving office. Last year, they introduced a new rule that limited their ability to lobby or represent others’ interests for six months after leaving office, and required them to register with the European Union Transparency Register. However, Rouvelle believes this is not enough.
“We need stricter rules after one’s term of office at the European Parliament is over, with a period of up to three years and a requirement for prior notification [of the European Parliament] regarding any activity during this period after leaving office.”
He adds that it is problematic that there are no rules regarding the composition of the dialogue team.
“While there is a code of conduct for MEPs, it is not clear whether it also applies to former MEPs.”
London-based company hired for digital marketing
In addition to Beust&Collegen International, the Serbian Progressive Party allocated around 370,000 EUR in 2022 for payments to Westminster Digital, a London-based company. Their task was to train SNS officials and members to do independent work in digital marketing. Contracts with SNS ended less than a month before the 2022 elections.
One of its owners at the time, Craig Dillon, was portrayed in the media as an advisor to Boris Johnson, and he told the British media that they were helping politicians from the UK’s Conservative Party to be “influential” on social media and to record video clips. According to his biography listed in several podcast shows where he appeared as a guest, he advised several politicians from the UK, the US, Australia, Canada, “and even Serbia.”
CINS journalists managed to contact Dillon, who has meanwhile moved to the United States where he appears on television under a different name: Thomas Corbett-Dillon. However, he did not want to speak about his former company’s cooperation with SNS.
“I am a political strategist based in Washington, and I have worked with many politicians across the globe. I have no further comment,” Dillon stated.
Other Westminster Digital employees we contacted did not have any information about the cooperation with Serbia’s ruling party. Earlier this year, a new owner acquired the company, and they assert that they no longer collaborate with the previous management’s political clients.
The Serbian Progressive Party also did not respond to questions regarding these deals.
The names of these companies that collaborated with the Serbian Progressive Party became available to the public only after Serbia’s State Audit Institution audited the party’s financial report.
The reason for this is that they listed business cooperation with them as expenses for training, working with their membership, and international cooperation – an item in the financial report that, according to the Regulations on Records and Reports of Political Entities, does not require specifying to whom the funds are paid and for what purpose specifically.
Every party must allocate a portion of its income for these purposes – at least 5%. They use these funds for various things – conferences, courses, and membership in international organizations. The Serbian Progressive Party spent over 430 million RSD (around 3.7 million EUR) in this way from 2018 to the end of 2023.
Lawyer Vladimir Tupanjac, who previously worked in the Sector for Monitoring the Financing of Political Activities of the Anti-Corruption Agency, believes that this entire provision of 5% for training is deficient, and that sometimes parties abuse it.
“The Agency prosecuted parties for not reporting these costs, and it is an offense if they do not spend those funds. So to avoid accountability, they first fill in those 5%, and push it into that category, but that’s not the idea.”
However, he says that since it already exists, it should be known who the money is going to, in this case as well as in advertising or organizing public events.
“Of course, where there is a service provider, especially when it comes to a legal entity or a business, the name should be entered primarily for greater transparency,” Tupanjac concludes.
Nemanja Nenadić from Transparency Serbia agrees that the public should have access to such data.
“Given that this interesting data became available only after the state auditor’s report, I think there is a good reason to change the regulations and make it mandatory to make the data public.”
Dirk Planert, a journalist from Germany, also participated in this investigation.
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