Serbia seeks compensation for sales of state companies in Kosovo

The issue is an important one for both countries, which are working to integrate into European institutions while dealing with the thorny problem of Serbia's refusal to recognise the independence of its breakaway republic. According to the Chamber of Commerce, which represents the interests of Serbian businesses, Kosovo has sold 720 companies for a total of 600 million euros.

"Privatisation is illegal because the government in Pristina is selling companies that were created by the investment of Serbia and other former Yugoslav republics," Zeljko Sertic, president of the Chamber of Commerce, told SETimes.

Sertic added that companies were sold for significantly less than their value, and that buyers were not determined based on the amount they offered, but by their ethnicity. He said a brewery in Pec was sold to Albanian businessman Ekrem Luka for 10 million euros, although beer industry experts said the company is worth 100 million euros.

"Serbia sent Pristina complaints on the manner of sales, but so far they paid no attention to it," Milivoje Miletic, director of the Chamber of Commerce's Bureau for Regional Co-operation, told SETimes.

Miletic said Serbia is interested in 30 percent of the remaining companies that the Kosovo Privatisation Agency (KPA) intends to sell. The Serbian government's office for Kosovo and Methohia also is involved in attempting to resolve the dispute.

"The Brussels agreement between Belgrade and Pristina envisioned that the community of Serbian municipalities in Kosovo and Metohia has its own property, so we will need to determine how much of the property of companies belongs to Serbia," Aleksandar Vulin, director of Serbia's office for Kosovo and Methohia, told SETimes.

Vulin added that further negotiations between Belgrade and Pristina would include discussions of property and economy impacting Serbs in Kosovo and Metohia. While Serbia has not sought a remedy through the courts, Vulin did not rule out the possibility.

"Serbia will seek ways to protect the property and compensation, including [through] the courts that are responsible for such actions," Vulin said.

Dusan Janjic, director of the Forum for Ethnic Relations in Belgrade, told SETimes that the sale of companies in Kosovo is most damaging to their former Serbian employees.

"They lost their jobs in 1999 when Serbia withdrew from Kosovo, and UNMIK later decreed that only workers who were employed by the company at the time it was privatised have the right to compensation or participation in the distribution of privatisation proceeds," Janjic said.

Prior to the breakup of Yugoslavia, the country invested up to 2 percent of GDP to spur development in Kosovo. According to Chamber of Commerce estimates, Serbia provided about 40 percent of the 3.29 billion euros that were invested in Kosovo between 1965 and 1990.

Now, companies from Serbia have almost 1,350 buildings in Kosovo and the state fund for the development of Serbia, which provides funds for economic development, has ownership of 163 companies in Kosovo, worth more than 180 million euros.

The KPA handles the sale of state and socially owned assets in Kosovo.

"Any eventual action undertaken from other institutions is illegal and not valid," Arta Gosalci, a spokesperson for the agency, told SETimes.

Gosalci said KPA is authorised to administer Kosovo's socially owned enterprises and their assets, "whether they are within the territory of the Republic of Kosovo or outside its territory."

Correspondent Linda Karadaku in Pristina contributed to this report.