The company "Media Marketing" would agree to terminate the ten-year advertising contract with "Montefarm" on the condition that the public institution pays them compensation in the form of the benefits they would have had if the contract had remained in force, in the amount of about one million euros.
This was told to "Vijesti" by representatives of this private company, emphasizing that there is nothing controversial in the contract, especially not material for the work of the Special State Prosecutor's Office (SDT).
The police are investigating whether the previous management of the public pharmacy institution "Montefarm" committed a criminal offense under the jurisdiction of the SDT, by signing a secret 10-year contract with a private company, without the right to terminate.
According to unofficial information from "Vijesti", a special police department last week seized documentation from "Montefarm" about the deal, including the controversial contract signed with the company "Media Marketing" from Podgorica, in which the public institution committed to giving that company 85 percent of the revenue from advertising in pharmacies.
In the contract, which "Vijesti" had access to, "Montefarm" and "Media Marketing" agreed that the provisions and everything related to the implementation of the contract were a business secret, and a clause was signed by which the public institution waived "any right it would otherwise have under the law" to terminate the contract before the term for which it was concluded or to request a reduction in any obligation.
The signing of the contract was also questioned by the Commission for Quality Control of Health Institutions, which determined that the former director Goran Marinović concluded advertising contracts contrary to the institution's Statute.
The private company suggested to the competent authorities that they "direct resources to other, more serious problems of our society."
"Montefarm" did not agree to pay 200.000
The new management of "Montefarm" has repeatedly unsuccessfully negotiated with "Media Marketing" over the past year to terminate a ten-year secret contract that agreed that the company would receive 85 percent of advertising revenue, but the company demanded 200.000 euros in damages and to keep the deposit of 30.000.
According to information from "Vijesti", the director Aleksandar Bogavac He offered the company to take over the entire monthly income (100 percent) until the end of the year, but to return the advance payment of 30.000 euros, which would be defined in an annex to the contract that would provide for the termination of the contract, the takeover of the display, and the return of the advance payment by December 31, 2024. Vijesti's sources also claim that Bogavac said that a positive attitude, or approval, of the Board of Directors would be necessary for any type of agreement.
The private company did not agree to this, and in early August it allegedly sent a letter to the new director claiming that the offer was "unacceptable, insulting and demeaning."
"If you believe there is a reason to terminate the contract or to initiate criminal or civil proceedings, feel free to do so. We have received information that you will do everything to make this contract fail, so if you feel that way, feel free to do so. But everything has its consequences," the company stated. The management of "Montefarm" was offered two options - to be paid damages or "some compensation" that they would agree to, or to continue doing their job and that there is no damage, but that there are improvements and that the institution focuses on getting much more.
According to unofficial information, about fifteen pharmaceutical companies are advertising in state pharmacies across Montenegro, starting in December 2023. Sources claim that "Media Marketing" should have earned around 70.000 euros from advertising to date, and the public pharmacy institution around 12.000, not including VAT.
In the contract, which Vijesti had access to, Montefarm also states that any placement of marketing and advertising material in printed form will be considered prohibited in each of the pharmacies from the moment of signing and that they assume full responsibility that no other advertising and marketing tools will be used during the duration of the signed cooperation with Media Marketing.
Court to protect conscientious party
“Media Marketing” attorneys, lawyers Marko Milosevic i Amar Pepić In their response to "Vijesti" they state that this is a regular legal transaction concluded between two business entities for mutual benefit and that they have no knowledge of the existence of any investigation in this regard.
"'Media marketing' DOO Podgorica has invested funds and know-how in order to modernize and digitize the marketing aspect of 'Montefarm' activities, by equipping the branches with modern LCD screens intended for advertising products from the 'Montefarm' range. On the other hand, 'Montefarm' has taken on the obligation to sell advertising space on these screens. They share the sales revenue in percentage terms in accordance with the contract. Since the beginning of the contract, both contracting parties have generated a significant amount of money," they said.
The lawyers point out that after the change in management at "Montefarm", "Media Marketing" DOO is encountering strong resistance to this contract from the new management, for unknown reasons, which surprises them because they believe that the contract actually benefits both contracting parties.
"We received a proposal to terminate the contract without the obligation to pay damages, which is absolutely unacceptable for our government. 'Media Marketing' DOO entered into this legal business, the important economic aspect of which and the motive for concluding it is precisely the duration of the contract. If they had known that the contract would be terminated within a year, they would certainly have redirected this investment to another business entity," claim the company's representatives.
They say that there is definitely a violation of contractual provisions with "Montefarm" because they have information that they are refusing to sell the service of selling advertising space on installed LCD screens, all with the aim of reducing the benefits that both companies derive from executing this contract.
"'Media Marketing' DOO would agree to terminate the contract, provided that 'Montefarm' pays it for the damage it suffers due to 'Montefarm's' breach of the contractual provisions, in the form of the benefit it would have received if the contract had remained in force, to which it is certainly entitled in accordance with the provisions of the Law on Obligations. This is a benefit amounting to approximately 1 million euros," the response states.
They point out that they do not understand why "Montefarm" acts in this way, but that they are showing that they do not adhere to their commitments, establishing poor business practices and uncertainty in doing business with state-owned legal entities, whose management personally depends on political trade.
"We hope that the court will protect the conscientious contracting party, in accordance with the provisions of positive regulations. The prosecution may potentially have work to do regarding the fact that "Montefarm" is causing damage to itself, and it is a state-owned company, or the responsibility of those in charge at "Montefarm" in the context of the criminal offense of abuse of position in business operations," the lawyers conclude.
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