The hearing of the Minister of Maritime Affairs Filip Radulović (PES) and his associates, the President of the Board of Directors of "Crnogorska plovidba" (CP) Petar Janković and the company's Executive Director Vladimir Tadić today before the Parliamentary Committee for Economy, Finance and Budget, regarding the sale of ships of that state-owned maritime company, did not provide answers to several key questions insisted on by representatives of the Association of Sea Captains from Kotor, on whose initiative the hearing was organized, the President of the Committee and Social Democrat MP Boris Mugoša, as well as the representative of Fidelity Consulting Miloš Vuković.
However, the hearing showed that the state representatives were aware that they sold the ships below cost, that they chose a law firm from Podgorica as an advisor in this matter even though it had no experience in such matters, and that Radulović, as he said, "feels absolutely no responsibility" because during his term as Minister of Maritime Affairs, the national merchant fleet in international navigation was halved, and the state-owned maritime company was literally destroyed and brought to the brink of closure.
However, it was heard that the almost three-hour discussion was useful because its recording, as announced by the Chairman of the Board Mugoša, will be submitted to the Special State Prosecutor's Office, which has already launched an investigation into the manner in which the "Crnogorska" ships were sold, and which is already facing criminal charges filed this summer by the Ministry of Maritime Affairs against the former Board of Directors of the company due to alleged unscrupulous business practices and possible criminal acts.
The bulk carriers "Kotor" and "21. maj" were sold in mid-September under controversial circumstances to the Danish company "Navision Group" for a total of $13,25 million, far less than their estimated market value, which ranged between $19 and $20 million.
The leaders of the Ministry of Maritime Affairs (MP) and "Crnogorska plovidba" (CP) admitted at a hearing today that the ships were sold significantly below their estimated value, which they themselves had done twice using the "remote" method, but they justified this by the need for the state to receive at least something for the property before it is seized and sold at court auctions around the world for much less money by numerous creditors to whom CP owes money.
"There has been a lot and too much written about this in the media - mostly incorrect. We are the ones who made the brave decisions that could only be made in this situation. CP was doomed to failure from the very beginning. I believe that the current Board of Directors and the company's director conducted everything related to the sale of the ships legally and transparently with the aim of returning as much of the money that the state claims from this company to the state budget," said Minister Radulović, who accused the former CP Board of Directors led by Captain Jovo Lazarević of alleged incompetence, obstruction and attempts to avoid financial analyses of the company's operations.
He defended the controversial agreement on business and technical cooperation between CP and "Barska plovidba" from May this year, which the professional public immediately characterized as illegal, harmful and previously unseen in the global maritime industry, as "an excellent move because it saved CP from bankruptcy at that moment", only for his State Secretary Pavle Tripković to say a few hours later that the option of opening bankruptcy in CP was not even in circulation "because there was no time for bankruptcy because creditors would abuse it and the state would be left with nothing".
Radulović, Tripković and the other state secretary in the Ministry of Justice, Jovan Šćekić, repeated the accusations against the former CP Board of Directors that they allegedly failed to timely contract ships for new leases at higher prices, as "Barska plovidba" did last year, even though the management could not do so while its contracts with the then current charterers were still in effect. They also raised the issue of more expensive overhauls of the "Crnogorska" ships in 2022 compared to the overhauls of the "Barska" ships, even though the Kotor-based company had to install expensive ballast water treatment systems on its vessels at that time, which Barani did not do. They rejected criticism of the Ministry of Maritime Affairs that its untimely reactions knowingly led CP into insolvency, but they did not answer specific questions about whether and when they requested a written statement from the Agency for the Protection of Competition on whether the restructuring program of "Crnogorska" would have allegedly constituted illegal state aid to that company, nor did they explain how such a thing could have been done in the case of the Igalo Institute and not in the case of the state-owned maritime company from Kotor, nor did they explain why, after the decision to sell the ships, they persistently placed false information in the media about their allegedly catastrophically poor technical condition, thus lowering their value in the eyes of potential buyers.
Radulović accused the representative of the Captains' Association, Janko Milutin, of attacking them on political grounds and not on the basis of their profession for what they did with the CP, alluding to the fact that Milutin was in the URA GP until 2023. The minister tried to devalue both the importance and work of the Captains' Association as a professional maritime association.
Most of the claims made by Radulović and his secretaries about the allegedly poor work of the former Board of Directors of "Crnogorska" were repeated by Tonći Janović, a member of parliament from the ruling PES party, who wondered why the Ministry had not dismissed the Board earlier and raised the question of its responsibility. He stated that "it is not logical that Montenegro has two shipping companies", but Janović also did not receive an answer to the question "what the total of around 11 million euros that the state received from the sale of ships was spent on".
CP leaders Vladimir Tadić and Petar Janković complained about the flood of negative circumstances that have hit the company over the past ten months as it has been struggling with liquidity, and what they said was "like the final nail in the coffin" was the arrest of the ship "Kotor" in the USA, which this summer, during a month of forced detention in the port of Savannah, accumulated a total of over 1,2 million dollars in unpaid liabilities to American creditors.
"We literally fled from the anchorage in front of Savannah so as not to pay our debts to American companies and to avoid the saddened charterer who threatened to demand millions in damages due to the delay in delivering the cargo to the British port of Tyne," said CP Director Vladimir Tadić, accusing the "Kotor" crew of behaving very disloyally and problematically towards the company, even though the company tried in every way to settle its obligations to the seafarers, and that it was the complaints of the "Kotor" seafarers to the ITF that caused most of the problems that had a devastating effect on the company.
His claim that the "Kotor" allegedly fled American waters to avoid paying millions in claims from American creditors caused laughter among those present, and Janko Milutin from the Association of Sea Captains commented that "the escape of a ship from a port in the USA is an impossible mission."
DPS MP Nikola Milović asked Minister Radulović if he remembered when a year ago in Kotor, Prime Minister and PES President Milojko Spajić assured the people of Kotor that "not that 'Crnogosrska plovidba' will not be shut down, but that we will buy additional ships and expand the company", and noted that Radulović "has a short mandate as Minister of Maritime Affairs with incredible and unforeseeable consequences because the centuries-old maritime tradition of Kotor and Boka Bay has been extinguished and enormous damage has been caused to the state of Montenegro".
"I wonder if, with the courage you say you had in making these decisions, you allowed that courage to prevail over the wisdom that should have been in this. We did not sell, but rather sold out the CP ships. The Danes boast that they did a great job on this and indirectly, in this way, suspicion is cast on you that you, on the other hand, did not do a good job for the state," said Milović, telling Radulović that "you will probably not be the Minister of Maritime Affairs anymore."
"It is inappropriate that such major decisions as the one on the sale of ships and the practical closure of the state-owned shipping company are made at a WhatsApp session of the Government. It is incredible how much bad information was expressed in public about these ships before and during their sale - how is this possible and is this a responsible approach," asked Boris Mugoša, who did not receive an answer to this, nor to the question of how much the total legal and other costs that CP had in the process of selling its ships to the Danes amounted to.
He pointed out that "this Ocean Race" sailing regatta in Montenegro, for which the Ministry of Maritime Affairs paid 5,25 million euros in early September, and the ship "Kotor" was sold for less money, "insults intelligence because you give five million euros for something like that, while at the same time you have a situation where our maritime economy is threatened, which is probably a hundred times more important to us than a sailing race."
Miloš Vuković from the consultancy firm Fidelity Consulting particularly questioned the work and fees of the law firm VRD Legal from Podgorica, which CP hired as legal advisor in the process of selling the ships, and asked how it was possible that two lawyers from VRD Legal allegedly "worked 150 hours on the contract for placing a mortgage on the ships without that mortgage ever being placed". He questioned as completely illogical and illegal the claim of CP director Vladimir Taduč that VRD Legal allegedly worked on registering a mortgage on the ships of "Crnogorska" in favor of American creditors, and that the Podgorica lawyers were paid for this by CP.
"Why didn't you go bankrupt through reorganization and thus 'buy' CP at least four years of protection from creditors and give the company a chance to survive because, as we see now, the situation on the maritime market is improving significantly and freight rates are rising? You claim that this would be illegal state aid and that you allegedly cannot do it, and then how did you 'pour' around 10 million euros into the company in the period from 2022, when the Agency for Maritime Affairs and Shipping concluded that the repayment of shipbuilding loans to the Chinese by the state was illegal state aid? You could then have added a few more million to get out of insolvency and at least the ships wouldn't sell for as cheap as they did," said Vuković, wishing the leaders of the Ministry of Maritime Affairs and the current management of CP "all the best in proving your innocence before the competent authorities."
The Chairman of the Board of Directors of CP, Petar Janković, defended the conclusion of the contract for legal services with VRD Legal, adding that everything was "done legally and with the lawyers' assessments everything was as it should be and there can be nothing controversial about it". He explained the abandonment of the sale of the ships to the preferred potential buyer, the Turkish EOS Group, which was ready to pay almost three million dollars more than the Danes, by the alleged additional conditions of the Turks and their unwillingness to quickly conclude the transaction, which did not suit CP in a situation where they were daily threatened with the danger of their ships being seized and put up for auction in court.
"The sales process has not yet been completed because the ship '21.maj' has not yet been handed over to the buyer. We are trying to do the best possible job in the given circumstances and I don't know how successful we have been," said Janković, while Director Tadić said that he hired the unknown and unestablished VRD Legal in maritime law "on recommendation, and their job was to finalize the contract regarding the mortgage on the ships in favor of American companies."
"I don't doubt them, because those two lawyers really helped us a lot and worked both morning and evening. A complete study with all the documentation on what the lawyers did on over 1.000 pages will soon be presented," said Tadić, who, however, did not specifically answer who recommended him to hire VRD Legal, which is now itself claiming amounts from CP that are measured in hundreds of thousands of euros.
Minister Filip Radulović announced that the Government will provide funds in the budget for next year for the purchase of a tugboat that will be entrusted to the use of "Crnogorska plovidba", so that it can provide mandatory towing and monitoring services for steel passenger ships entering the Port of Kotor.
MP Boris Mugoša, summing up the debate, said that it was certain that the CP ships were sold at a price that was at least 30 percent lower than their estimated market value, that the leaders of the MP and the company did not provide the Committee members with answers to all the questions asked, and called on "the competent authorities to bring all this to light - both in relation to the sale of the CP ships and in relation to the criminal charges filed against the company's former management by the Ministry of Maritime Affairs this summer."
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