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The Agreement confirms the unlawful hiding of information

Transparency – Serbia (the member of Transparency International) demands that it be determined who is responsible for the three-year hiding of the agreement on management of Smederevo Ironworks (Železara Smederevo) from the public, as well as for the possible occurrence of damage during its realization and termination. At the same time, we call on the Government of Serbia and the Ministry of Economy to publish the entire text of the contract, as well as information on its realization, on the basis of which citizens could gain insight as to whether the claims of her former partner in this business were founded.

Transparency – Serbia points out that the published parts of the Smederevo Ironworks management agreement, concluded by the Government of Serbia with the firm of Petar Kamaraš, confirm that this agreement is illegally hidden from citizens in the past three years. In this case, it has been shown that secret contracts on the disposal of public property are detrimental and that the publicity of the key information will have to be a condition of the validity of the contract in the future. It has also showed how dangerous it would be to exclude state-owned enterprises from the system of access to information of public importance, as foreseen in the current draft amendment to the Law on Free Access to Information. Also, it is extremely important that a mechanism that would prevent the conclusion of secret contracts on the disposal of public funds is created through the changes to the Constitution.

The agreement of the management of Smederevo Ironworks from 2015 was promoted and praised by the highest representatives of the Government of Serbia. A year later, the state terminated the contract with the assertion that the consultant failed to meet its obligations. According to the decision of the contracted arbitration in London, Kamaraš claims a compensation for the damages of 10 million dollars and 2.4 million of the costs of the proceedings. For all this time, even when the contract was declared a salvage solution, nor when it was broken, the citizens of Serbia did not have reliable data on the undertaken obligations and handling of public property, but only the claims of both sides.

Transparency Serbia requested a copy of the contract from the Ministry of Economy three years ago. However, not only was the request for access to information denied, but the Ministry refused to submit a contract under the Commissioner for information’s decision, withholding access to those documents even to the Commissioner himself. Regarding this violation of constitutional rights, the Ombudsman has also reacted. We recall that, contrary to the secrecy of this contract, which was kept by the Ministry of Economy and at the cost of paying fines, the agreement on the sale of Ironworks to China Hestil from April 2016 was immediately published.

Parts of the contract published by the Insider portal confirm that the absolute secrecy of this document has never been justified or necessary. Namely, the standard confidentiality provisions are followed by the rule in Article 13.2.1. according to which each contracting party, which means the Government of the Republic of Serbia, Ironworks and Kamaraš’s company “can communicate the information that would otherwise be considered confidential, if and to the extent required by the applicable law”. Since the law of the Republic of Serbia is the law applicable to this contract, and the Law on Free Access to Information of Public Importance is undoubtedly a part of that right, it is clear that the Ministry of Economy could have provided copies of all or parts of the contract on request for access to information, without seeking prior approval from a private partner.

We remind that the Ministry of Economy when it was alleged that the contract should not be published, called for the decision of the Commission for Protection of Competition, pursuant to the Article 45 of the Law on Protection of Competition. The meaning of this provision is undoubtedly the protection of confidential data which the contracting parties have submitted to that Commission for the purpose of carrying out tasks within its jurisdiction. On the other hand, the procedural decision of the Commission does not impede the signatories of the contract to publish information themselves or to act on binding decisions of other bodies. In order to avoid misinterpretation and similar abuses in the future, the Commissioner recently submitted a proposal to declare this article of the Law on Protection of Competition unconstitutional.

Transparency – Serbia, Belgrade, August 7th 2018

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