Croatia’s centre-right government has hustled changes to the law on privatisation of the national oil company through parliament, to harmonize the law with EU legislation and so avoid a lawsuit – but MPs have denounced it as a betrayal of national interests.
Croatia’s parliament amended the 2002 law on privatisation of the national oil company INA on Wednesday, to align the privatization law with EU legislation and so avoid threatened lawsuits.
Opposition MPs left the chamber at the moment of the vote having denounced the proposed changes.
The amendments abandon provisions from article 10 of the 2002 law that gave the Zagreb government exclusive control over changes to the company’s ownership structure and the right to veto certain decisions of the management – and the first option to buy shares.
Croatia has made the changes after the European Commission in 2017 referred it to the EU Court of Justice for failing to make the law on INA compliant with EU rules on free movement of capital and freedom of establishment.
In 2018, the Commission put the law case on hold after Croatia had in the meantime demonstrated that it was preparing legal changes.
On February 13, the chairman of the parliamentary group of the ruling Croatian Democratic Union, HDZ, Branko Bacic, said the bill was being fast-tracked as it had been debated in parliament and in public for years.
Amendments were submitted and discussed in parliament on February 15 under fast-track procedure.
Energy Minister Tomislav Coric said this was motivated by the need to align Croatian and EU law and so avoid lawsuits before the European Court of Justice.
The fate of INA has long been a bone of contention in Croatia and a major source of tension with Hungary.
In 2003 and 2008, Hungary’s MOL bought 47.15 per cent of INA shares, leaving the Croatian state with 44.83 per cent.
MOL then took over management of INA in 2009.
In 2011, however, Croatia’s anti-corruption office, USKOK, said it suspected that, between 2003 and 2009, Croatia’s then prime minister, Ivo Sanader, had taken bribes of 10 million euros from MOL’s chief, Zsolt Hernadi, to obtain INA’s management rights.
In December 2016, Croatia lost an arbitration process against MOL over this issue before the UN Commission on International Trade Law, UNTRAIL, in Geneva.
Croatia has repeatedly said it will buy back the MOL shares in INA. Prime Minister Andrej Plenkovic announced the pledge anew on Christmas Eve 2016. But the idea has never been realized.
Since October, a retrial of MOL boss Hernadi and Sanader in Zagreb, but without Hernadi’s presence, has been ongoing.
In November, Interpol approved a Croatian request submitted in August for a renewal of a “Red Notice” arrest warrant against Hernadi.
The day before the amendments passed, opposition Social Democratic Party MPs accused the government of handing over INA to MOL and of betraying national interests.
But HDZ members defended the law, saying that any party acquiring INA shares and wishing to own more than 50 per cent of them would have to inform the relevant minister about it, and submit a long-term management plan.
Based on the minister’s opinion, the government would make a decision on consent for the acquisition of the shares within 30 days.
By law, as long as the Croatian government owns a single share of INA, it gets to name two representatives to the company management board – but without any voting rights.
The Balkaninsight
