Prof. Velić: Right to Property as a Universal Right and How Croatia is Robbing Bosnia and Herzegovina

(Patria) - A scientific conference titled “European and Euro-Atlantic Perspective of Bosnia and Herzegovina in the Context of New Geopolitical Relations” held at the Faculty of Criminalistics, Criminology and Security Studies of the University of Sarajevo was rich with interesting topics of great significance in the context of the current situation in BiH.

Prof. Dr. Larisa Velić spoke on the topic “Right to Property as a Universal Right or an Expression of Particular Interests - The Succession Agreement / The Stabilisation and Association Agreement”.
A topic that takes primacy in BiH society, given that it is increasingly clear that Bosnia and Herzegovina cannot join the EU until it resolves the issue of property. 

„The regulation of property issues represents a priority in all social systems. We had a system in which social ownership was the basic type of ownership, while private ownership was limited.

Today, the Protocol to the European Convention for the Protection of Human Rights and Fundamental Freedoms is applied, which states that every natural and legal person is entitled to the peaceful enjoyment of their possessions, and that no one shall be deprived of their possessions except in the public interest and subject to the conditions provided for by law and by the general principles of international law,“ said Prof. Velić.

However, we are witnessing that this is not exactly the case.

„On June 29, 2001, in Vienna, Bosnia and Herzegovina, the Republic of Croatia, the Republic of Macedonia, the Republic of Slovenia, and the Federal Republic of Yugoslavia, representing five sovereign equal successor states of the former Socialist Federal Republic of Yugoslavia, signed the Agreement on Succession Issues. This Agreement entered into force on June 2, 2004, after Croatia, as the fifth party to the Agreement, ratified it. According to the provision of Article 2 of Annex G of this Agreement (Annex G relates to property and acquired rights), the parties to the Agreement must recognize, protect, and return property to which natural and legal persons were entitled as of December 31, 1990. 

According to Article 7 of the Agreement, the Agreement finally settles issues of common rights and obligations, thus it is stipulated that each successor state shall take the necessary measures in accordance with its own laws to ensure that the provisions of the agreement are recognized and implemented by all competent authorities. In the spirit of the aforementioned, Bosnia and Herzegovina has taken all necessary steps to return property claimed by the successor states of the former Yugoslavia (the Council of Ministers of BiH adopted the Decision on the Implementation of the Succession Agreement, without monitoring whether neighboring states are acting in the same manner)“, says Prof. Velić.

Based on that Decision and others adopted subsequently, the return of property to the signatories of the Agreement was carried out. 

„However, other republics, i.e., now states, did not follow this practice. The Republic of Croatia, on whose territory there are numerous properties to which natural and legal persons from Bosnia and Herzegovina claim rights, views the Agreement only as a basis for concluding further bilateral agreements, and until such agreements are concluded, it generally prevents the return of property. As early as 1991, the Republic of Croatia, by the Decree on Prohibition of Disposal of Real Estate on the Territory of the Republic of Croatia, restricted the disposal of real estate owned by companies and other legal entities with registered offices outside the Republic of Croatia, and notes of the prohibition of disposal were entered ex officio in the land registers. 

This Decree was presented as an act of preserving the property in question; however, it turned out that this was done to the detriment of the owners. Several years later, the Republic of Croatia went a step further and in 2018 adopted the Law on the Management of State Property, which gives it the right to dispose of other people's real estate by leasing or renting it out for a period of up to 30 years. Thus, according to Article 71 of the aforementioned Law, until the conclusion of an appropriate international treaty (bilateral agreement) or the adoption of a decision on exemption from the prohibition of disposal, the Ministry of State Property of the Republic of Croatia was authorized to dispose of the property of Bosnia and Herzegovina by leasing, renting, or otherwise using it long-term“, explains Prof. Velić. 

The ownership position of persons who do not have a registered office in Croatia has thus become unenviable.

In Bosnia and Herzegovina, unfortunately, there is no single institution dealing with the issue of property protection and return. 

„When it comes to state property, former state enterprises, etc., this matter is handled by the Presidency of Bosnia and Herzegovina, the Council of Ministers of Bosnia and Herzegovina, the Ministry of Justice of Bosnia and Herzegovina, the Attorney's Office of Bosnia and Herzegovina, negotiation teams, joint commissions, etc. Certain actions and activities are undertaken by these institutions, but the fact is that the property of Bosnia and Herzegovina has neither been returned nor enjoys the necessary protection“, emphasizes Prof. Velić.

In 2008, a comprehensive Stabilisation and Association Agreement was concluded between the European Communities and their Member States, on the one hand, and Bosnia and Herzegovina, on the other hand. 
„This Agreement emphasizes that the development of good neighborly relations and human rights is of key importance for the stabilisation and association process. An important part of the Stabilisation and Association Agreement are also the fundamental freedoms aimed at stronger market integration between the EU and Bosnia and Herzegovina. Given that the prohibition on the disposal of real estate applies only to foreigners or foreign companies, this constitutes discrimination. 

In that case, there is a possibility that, within the framework of the dispute settlement mechanism, Bosnia and Herzegovina can address the Stabilisation and Association Council and request consultations and a decision from them. 
The Council is authorized to resolve the dispute by a binding decision. However, only the contracting parties have active legal standing, not individual natural or legal persons. 

„It is not known that any attempt has been made to resolve a disputed issue in this way. Protection of Bosnian-Herzegovinian real estate in Croatia based on the Agreement on the Promotion and Protection of Investments concluded between Croatia and Bosnia and Herzegovina. An Agreement on the Promotion and Protection of Investments was signed between Bosnia and Herzegovina and Croatia back in 1996. This Agreement regulates the protection and promotion of (private) investments in each of the states.

According to this Agreement, a dispute between the contracting parties is resolved before the International Centre for Settlement of Investment Disputes or before an ad hoc arbitral tribunal, if the disagreements cannot be resolved amicably within six months. 

Similar to the Association Agreement, this Agreement is also practically not applied or is applied very little by Bosnia and Herzegovina, regardless of the fact that according to it we have the possibility to initiate proceedings in order to obtain compensation for effectively already expropriated real estate“, added Velić.