The Government accepted the proposal of the Minister of Maritime Affairs Radulović: Both ships of Crnogorska plovidba are being sold.

At the proposal of the Ministry of Maritime Affairs, headed by Filip Radulović (PES), the Government of Montenegro decided at today's session to oblige its representative in the Shareholders' Assembly of the maritime company Crnogorska plovidba from Kotor, State Secretary at the Ministry of Maritime Affairs Jovan Šćekić, to vote to sell both ships of that company at the upcoming Extraordinary Shareholders' Assembly of Crnogorska plovidba next week.

The "Information on the Amendment to the Agenda of the Extraordinary Shareholders' Meeting of Crnogorska Plovidba" scheduled by the recently appointed Board of Directors of the company for July 16th states that the company's ship "Kotor" has been stopped in the American port of Savannah since June 20th "where it was initially detained by the United States Coast Guard due to numerous irregularities and damage to the ship."

"For these reasons, the ship was kept unseaworthy and is still in such a state. Due to the inability to start the engine, the American authorities ordered that the ship be constantly supported by two tugboats, for which the local company Moran was hired, whose invoices currently amount to around 650 thousand dollars. In addition, port and other related costs currently amount to over 310 thousand, and are increasing every day. The ship is carrying cargo with an estimated value of around seven million dollars. Due to the detention in Savannah, the ship is over 15 days late in unloading the goods at the next port, which is in England. Due to the aforementioned fact, it is expected that numerous penalties will be levied against the charterer and its sub-charters, which in total may amount to over three million," the Information states.

They claim that the company that operates the tugboats hired by the Coast Guard to assist the "Kotor" has initiated proceedings to arrest the ship in order to collect its claims, and that they are "currently preventing it from leaving the port."

"We reiterate that as of today, the ship is still not in seaworthy condition. Although we are constantly working to eliminate all deficiencies and make it seaworthy, at this point we cannot give a reliable estimate of when the ship will be seaworthy. If the Government, as the owner's representative, does not take concrete measures, there is a great risk that the ship will be sold under American regulations, which in the worst-case scenario would entail a forced sale of the ship for the value of accumulated claims. Such a scenario would mean a multi-million loss to state property," the Ministry of Maritime Affairs wrote in the Information that the Government considered today.

They note that this difficult situation with the "Kotor" "directly negatively affects the status of the company's other ship, the "Dvadesetprvi maj", which they claim is "also in very poor condition".

They remind that Montenegrin Shipping, which is 100 percent state-owned, owes the Government 37 million euros for installments of the loan taken out for the construction of these two ships, which were in the meantime paid by the state instead of this maritime company as a guarantor of loan repayment.

They also point out that Crnogorska plovidba has major liquidity problems that prevent it from regularly settling the claims of its creditors on a daily basis.

"Although we, as the relevant ministry, have taken a number of actions to keep this company active, unfortunately a situation has arisen that is impossible to control and it is necessary to urgently take concrete actions to save the company's assets to the extent possible," said the ministry led by Minister Filip Radulović (PES).

They emphasize that it is therefore necessary for the Government, as the owner's representative, "to undertake all necessary activities in order to take control of the ship's sale process and achieve a purchase price that is achievable under market conditions."

"Therefore, we believe that the only viable decision is for the Government to proceed with an open procedure for the sale of the ship under market conditions, so that the ship 'Kotor' is released, all creditors are satisfied, and the remainder of the realized value from the sale is returned to the state budget," the document states, noting that the Board of Directors of Crnogorska plovidba has called an extraordinary shareholders' meeting for July 16, "at which the decision on establishing the lien on the ship 'Kotor' will be considered."

In translation, this means that the Board of Directors of Crnogorska intended to use the "Kotor", which, like the "Dvadesetprvi maj", is currently completely "clean" in terms of credit burdens because the last installment of the loan to the Chinese Exim Bank was paid in January, as a means of securing a new loan from commercial banks, which the company would take out to solve its liquidity problems and free the ship from debt bondage in the USA.

However, the Ministry of Maritime Affairs is determined to prevent this and has proposed to the Government, which has accepted it, that both Montenegrin ships, and not just the "Kotor" stopped in the USA, be sold on the market.

"Given that the pledge in itself does not solve the aforementioned problem due to the disagreement of all creditors, we propose that the Government, in accordance with the Law on Business Companies, amend the agenda of the Shareholders' Meeting in such a way that the Decision on the sale of the ships 'Kotor' and 'Dvadesetprvi maj' will be included in the agenda. Given the above, it is necessary to authorize the State Secretary at the Ministry of Maritime Affairs, Mr. Jovan Šćekić, to vote for the adoption of the Decision on the Pledge and the Decision on the Sale at the upcoming Extraordinary Meeting," the Information concludes.