Croatia invested in Gacko, but since 1992 it has not received the contracted amount of electricity.
During 2017, the BiH Attorney’s Office issued urgent requests to peacefully resolve the request of Hrvatska elektroprivreda (HEP), which, based on pre-war investments in the Gacko Mine and Thermal Power Plant (RiTE), sought compensation of 100 million euros.
The then convocation of the Council of Ministers formed a commission to resolve the dispute, which included representatives of RiTE Gacko, the Bar of Bosnia and Herzegovina and the competent ministry in the Republic of Srpska. But that’s about it.
“We negotiated, the Croats asked for their own, but you cannot talk to these people because they have no idea. They were patriots beating their chests. They blew it. And people (HEP, op.a.) saw that they had no one to negotiate with and sent a lawsuit,” Mlađen Mandić, who at the time of HEP’s request, was the head of the Office of the Ombudsman, told Deutsche Welle.
Considering everything seen, he says that the question is not whether the dispute will be lost or won, but how much will have to be paid to the Croatian company.
Višković is threatening a counterclaim
“If Croatia does not agree, then they will receive a lawsuit for HPP Dubrovnik, which is significantly larger than theirs for Gacko,” said the Prime Minister of the RS, Radovan Višković.
“It could have been solved for a tenth of the amount we will have to pay. And if we add two million euros to that, which BiH, that is, Republika Srpska needs to participate in the arbitration, I don’t need to tell you anything further,” says Mandić.
Croatia is demanding one hundred million euros plus interest based on investments in RiTE Gacko during the eighties. Croats, like Slovenians, invested in energy, and Gacko was one of the entities whose construction they co-financed, with the condition of supplying one-third of the electricity.
Everything worked until the start of the war in 1992, and Croatia is now looking for its own. First, in 2017, they tried to resolve disputes peacefully, but given that the authorities in the RS and BiH did not listen, the arbitration process is increasingly certain.
“Based on the investment in TE Gacko during the SFRY, HEP believes that it has certain rights, including compensation claims. “HEP took over the electricity from that power plant in the period from 1984 to 1992, when Bosnia and Herzegovina, that is, Republika Srpska, nationalized HEP’s investment,” the Croatian company told DW.
“The Attorney General’s Office of Bosnia and Herzegovina has asked the HEP to extend the deadline for statements three times, and the HEP has not yet received a concrete answer to the request for a peaceful resolution of the dispute, that is, a concrete proposal for possible settlements”, they said in the HEP.
Director of RiTE Gacko Maksim Skoko says that the entire case has been transferred to BiH and that there is no more information about it. “This is all going towards Bosnia and Herzegovina, we are not aware of what is happening, because Bosnia and Herzegovina has been informed about it, and not us as a business entity. I’m not your interlocutor for those questions,” Skoko said.
The BiH Attorney’s Office confirmed that it is aware of Croatia’s intention to go to arbitration. The authorities of Republika Srpska have their visions. “If Croatia does not agree, then they will receive a lawsuit for HPP Dubrovnik, which is significantly larger than theirs for Gacko,” said the Prime Minister of the RS, Radovan Višković, and called for an agreement without lawsuits.
The “Dubrovnik” hydroelectric power plant was built as part of the system of three hydroelectric power plants – Trebinje 1, Trebinje and Trebišnjica. The reservoir potential is Lake Bilećko, and part of the infrastructure is located in the territory of the Republic of Srpska.
HPP Dubrovnik 2
But the problem is deeper. In 2012, at a meeting in Banja Luka, the then Vice-President of the Croatian Government, Radimir Čačić, and the President of the Government of the RS, Aleksandar Džombić, agreed on the formation of a joint company for the construction of HPP Dubrovnik 2, worth 170 million euros.
It is planned to build a 300-megawatt hydroelectric power plant near Dubrovnik and to be supplied with water from the Trebišnjica Hydroelectric Power Plant. Although both announced the completion of the works in three years, the project was never realized.
