Council of Ministers of BiH amends Draft Budget, secures funds for BHANSA's uninterrupted operation

(Patria) - The 77th session of the Council of Ministers of BiH was held in Sarajevo today.

Amended Draft Budget

The Council of Ministers of BiH, in accordance with the conclusion from its 76th session, held on April 15, 2025, and in order to execute the arbitration award in the case "Viaduct d.o.o Portorož and others v. Bosnia and Herzegovina", determined by a majority of votes the amended Draft Law on the Budget of Institutions of Bosnia and Herzegovina and International Obligations of Bosnia and Herzegovina for 2025.

The Ministry of Finance and Treasury will urgently submit the Draft Law on the Budget, with the accepted corrections from the Legislative Office, to the Presidency of BiH, which is authorized to propose it to the Parliamentary Assembly of BiH, which ultimately adopts this law.

The Council of Ministers of BiH previously withdrew the established Draft Budget from the procedure and called on the Presidency of BiH and the Parliamentary Assembly of BiH to urgently adopt this Draft Law, in order to prevent further detrimental consequences to the property interests and reputation of Bosnia and Herzegovina.

The Ministry of Finance and Treasury will pay KM 110,169,862.95, planned under Direct Transfers from the Treasury Single Account - Payments based on final court judgments, within 15 days from the date the Law on the Budget of Institutions of BiH and International Obligations of Bosnia and Herzegovina for 2025 enters into force, and no later than seven days from the deposit by the Central Bank of BiH.

The budget framework for financing the institutions of Bosnia and Herzegovina for 2025 remains the same and amounts to KM 1,570,500,000, as in the Draft Law on the Budget of Institutions of Bosnia and Herzegovina and International Obligations of Bosnia and Herzegovina for 2025, which the Council of Ministers of BiH adopted at its 72nd session in early March.

The Council of Ministers of BiH amended the Draft Budget to urgently proceed with the execution of the arbitration award where Bosnia and Herzegovina is the enforcer, which will enable the initiation of a recourse action and ultimately the recovery of damages from Republika Srpska.

Bosnia and Herzegovina became the enforcer of the judgment because the Government of Republika Srpska lost the case against the plaintiff in the "Viaduct" case, after which it did not pay the debt to the plaintiff despite the agreement signed with the Council of Ministers of BiH in 2017, by which it undertook to unconditionally fulfill all its payment obligations according to the judgment rendered in this arbitration proceeding on behalf of Bosnia and Herzegovina, upon receipt of a documented request from the BiH Prosecutor's Office.

Funds Secured for BHANSA

The Council of Ministers of Bosnia and Herzegovina, in accordance with the conclusion of the 76th session of the Council of Ministers of BiH held on April 15, 2025, and in order to execute the arbitration award in the case "Viaduct d.o.o Portorož and others v. Bosnia and Herzegovina", considered the Proposal for a Decision on financing the costs of the Air Navigation Services Agency of Bosnia and Herzegovina (BHANSA) on a temporary basis, and in this regard concluded:

Upon the proposal of the Ministry of Communications and Transport, a Decision was made on financing the costs of BHANSA on a temporary basis until the end of the third quarter of 2025, in order to enable its uninterrupted operation and resolve business problems.

The business problems were caused by the freezing of overflight revenues that this agency receives from EUROCONTROL due to enforcement proceedings initiated by the company "Viaduct d.o.o. Portorož" based on the ICSID Tribunal's arbitration award, after the Government of Republika Srpska lost the case against the plaintiff in this matter and did not settle its assumed debt payment obligations.

In accordance with this decision, the Air Navigation Services Agency of BiH will be provided with up to KM 60,108,155, which corresponds to the maximum amount of BHANSA's expenses, planned in the Financial Plan for 2025, adopted by the Council of Ministers of BiH.

The Ministry of Finance and Treasury is obliged to transfer funds to BHANSA on a monthly basis based on its request for funds in accordance with expenses from the adopted Financial Plan and execution in the previous period.

These funds will be considered a loan and will be returned to the Treasury Single Account after the EUROCONTROL funds for BHANSA's financing are unblocked.

The BiH Prosecutor's Office is obliged to take actions to protect the property interests of Bosnia and Herzegovina in accordance with the Agreement concluded in 2017 between the Council of Ministers of BiH and the Government of Republika Srpska, which undertook to unconditionally fulfill all its payment obligations according to the judgment rendered in this arbitration proceeding on behalf of Bosnia and Herzegovina, upon receipt of a documented request from the BiH Prosecutor's Office.