Transparency Serbia submitted a proposal to delete illegal representatives of state-owned companies from the register

Of the 34 state-owned enterprises to which the Law on Public Enterprises applies, only nine have directors selected in a competition, as required by law, while 22 are led by acting directors. In three other companies, it was not possible to determine the status of the director.

In 22 cases where companies are run by the acting director (13 public companies and nine joint stock companies or limited liability companies), in as many as 19 the mandate of the acting director has expired. By law, the acting director’s mandate lasts a maximum of 12 months.

All decisions and contracts signed by those 19 citizens who illegaly run state-owned companies after the expiration of their mandate are null and void. It has already been determined by at least one court decision[1]: in that case, the employee won a dispute against the SOE „Post of Serbia“, because the decision against him was made on the basis of the written authorization of the acting director whose term was expired.

Given that such an illegal situation couldcause unforeseeable harmful consequences, Transparency Serbia (TS) submitted a proposal to the Ministry of Economy to supervise these 19 companies, to inform the Government of Serbia as the founder andinitiate a procedure for selecting directors, and to inform other authoritieson the necessity to perform inspection supervision over the acts of state-owned companiesthat have been passed by unauthorized persons and to delcare their nullity.

TS also submitted to the Business Registers Agency the initiative to launcha procedure of changing data on the representatives of state-owned companies in the register and thus prevent further occurrence of harmful consequences that inaccurate data can produce in the legal order and transactions.

All correspondence (in Serbian) can be found on the TS website, at the page Activities /“Razrešenje v.d. stanja u javnim preduzećima".[2]

TS collected detailed data on the appointments of directors and acting directors for all 34 companies. Since 2012, when the Law on Public Enterprises was adopted, public competitions for the election of directors have been mandatory.

In some of the companies no competition has been completed since 2012 and their acting directors have not changed for seven or eight years. The SOE „Roads of Serbia“, whose acting director has not change that status for nine years, holds the record.

According to TS data (available at the same web-page), the competitions announced in 19 companies, in 2017, have not been completed yet. It is interesting that in six out of these 19 companies, the competitions had been announced in 2013 but not completed before the announcement of the new ones. In one company, a never-completed competition was announced in 2015, and in six companies, where 2016 competitions had no epilogue, the new ones were also announced. Again, there was no appointment of a director.

SOE’s without lawful directors or acting-directors:

1. NP Đerdap
2. Državna lutrija doo
3. EPS
4. ETV
5. NP Fruška gora
6. NP Kopaonik
7. Koridori Srbije
8. Mreža most
9. Nuklearni objekti Srbije
10. Pošta Srbije
11. Putevi Srbije
12. JP PEU Resavica
13. Srbija kargo
14. Srbija voz
15. Srbijagas
16. Srbijašume
17. NP Stara planina
18. NP Uvac
19. Železnice Srbije

It was not possible to determine the status of the director for the SOE„Šar planina“, but according to the available data, there is no lawfully selected director.

The acting directors also run Transnafta a.d., Infrastruktura železnice Srbije a.d. and Tvrđava Golubački grad d.o.o, but their mandate have not expired yet.

[1]https://www.blic.rs/vesti/drustvo/sud-mira-petrovic-nije-direktor-ponistena-resenja-o-suspenzijama-radnika-poste/mvx3qtf (In Serbian)

[2]https://www.transparentnost.org.rs/index.php/sr/projekti/191-razresenje-v-d-stanja-u-javnim-preduzecima