The land of the Ulcinj Saltworks is undoubtedly state-owned, and this was confirmed by the Privatization Council with its adopted opinion that market compensation for the real estate belonging to that company was not paid.
The protector of property and legal interests of Montenegro pointed this out to "Vijesti". Bojana Cirovic.
"This opinion was also confirmed by the Supreme Court, which means that the legal condition according to which it remains state property has been met, as stated in provision 419 of the Law on Property and Legal Relations. The procedure was not returned for the purpose of converting ownership because that procedure has already been legally concluded. It was returned for a new procedure in order to eliminate irregularities related to the registration in the cadastre. The administrative procedure that the court mentions and refers to in the judgment is precisely the one that is being conducted," Ćirović told "Vijesti" regarding the recent ruling of the Administrative Court to annul the decision of the Ministry of Finance of June 15, 2022.
The ruling also annulled the state's registration as the titleholder of 15 million square meters of property, explaining that the state should have "initiated civil proceedings regarding ownership rights over real estate" before deciding on ownership rights.
Ćirović stated that this is the procedure that follows the opinion of the Privatization Council that the market fee was not paid, and therefore it is not the property of the Saltworks, but remains state-owned.
"The procedure for giving the Council's opinion is one procedure and it is completed. Now the procedure for changes in the cadastre is another procedure. So what is key to everything is the Council's negative opinion, while this procedure in the cadastre is something that depends on the proper application of regulations," said Ćirović.
The bankruptcy administration cannot advertise the sale of assets.
Responding to the question of whether the bankruptcy administration could possibly re-announce the auction for the sale of Solana's assets after the verdict, she assessed that this was impossible.
"In order to advertise something for sale, the property must first be registered in the B list of real estate, which Solana does not have and cannot have, given that the Council's opinion that the market fee for those real estates was not paid is final, which means that there is no property in favor of Solana. Therefore, the Administrative Court has not returned Solana to Eurofond, as could be heard in recent days, nor is it possible," said Ćirović.
However, the shareholders of the Saltworks, among which Eurofond is the largest, claim that the Administrative Court's ruling annulled the illegal registration of the land of the "Bajo Sekulić" Saltworks as state property.
"The court determined that Solana was never state property, but rather the property of a joint-stock company, whose shares are listed on the stock exchange. The decision of the previous government to register the property of a private company, without a court, without compensation and without a legal basis, as state property, has now been legally challenged and overturned," the shareholders of Solana "Bajo Sekulić" said in a statement yesterday after the Administrative Court's ruling.
The shareholders said "it is particularly important to emphasize that the Administrative Court's ruling "restored the status quo on the right of use", which means that the competent authorities should now, without further delay, fulfill their legal obligation and implement the conversion of the right of use into the right of ownership, as has already been done in dozens of other cases, in accordance with the applicable law".
"Otherwise, Montenegro could be exposed to serious legal and financial consequences. According to public statements, the state could face lawsuits worth more than 200 million euros, which, in the event of failure to act in accordance with the law, could be filed before domestic and international courts, including the European Court of Human Rights in Strasbourg," the shareholders claim.
If, as they state, the narrative that the land did not belong to Solana were accepted, it would mean that state institutions that participated in the privatization, issuance and trading of shares essentially issued shares without any asset backing.
The Privatization Council, while headed by then Prime Minister Zdravko Krivokapić, issued an opinion in 2021 that market compensation was not paid for the shares of Solana, and that the shareholders of the company, among whom Eurofond is the largest, do not have ownership rights over the land in Ulcinjsko Polje, although they had the right to use it until then.
The Council determined that the state is the "undisputed" owner of the Solana land, whose value is estimated at 157 million euros.
Based on this, the cadastre in 2022 registered the state of Montenegro as the owner of the Solana property.
Reasoning of the Administrative Court
In the reasoning of the judgment, among other things, the court assessed that for the conversion of ownership rights to be legally valid, the following assumptions should be met: the existence of the right to manage, use, or permanently use and dispose of land in social or state ownership, the suitability of the land to be an object of ownership rights, that a special law does not prohibit this conversion, or that the interested party does not prove that he acquired the right to ownership of the land before the entry into force of the ZOSPO and that the market price for the land was paid, and this only in cases where the right was acquired in the privatization or bankruptcy process.
It is also emphasized that "in this specific case, the transformation cannot be implemented even in accordance with paragraph 2 of Article 419 of the ZOSPO, since this provision stimulates the situation when market compensation is not paid in the privatization or bankruptcy procedure, and in that case the land "remains" in the ownership of the state."
"However, given the fact that Articles 419 and 420 of the ZOSPO must be interpreted integrally, and since Article 420 clearly states at the request of which person the intabulation of ownership rights may be carried out, this, in the opinion of this court, is not a transformation. The court therefore concludes that the contested first-instance decision is the result of an incorrect application of substantive law, and therefore the claims of the first- and second-instance plaintiffs should have been accepted and the contested decision annulled," the reasoning states.
The Administrative Court ultimately pointed out to the defendant, i.e. the state of Montenegro, that in the retrial it is necessary to enable the parties to participate in the proceedings and provide them with the opportunity to comment on the results of the investigation procedure.
The fate of the Ulcinj Saltworks is crucial for closing the environmental chapter in the negotiations between Montenegro and the European Union.
It is one of the key conditions for closing Chapter 27 and progressing towards EU membership.
This implies a clear ownership and management status of this area, which was declared a nature park in 2019 and included in the Ramsar list of wetlands of international importance.
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