Association: If state loses arbitration case to banks, it should tax their assets

The chief coordinator of the Franak association, Goran Aleksic, has said that Croatia could have avoided a complaint filed by banks with an arbitration court in Washington had state officials talked to banks in time and threatened them with introducing taxes on bank assets, noting that this was still an option if the arbitration court decided that the state had to compensate banks.

The Jutarnji List daily said on Wednesday that Intesa Bank and Unicredit, and probably Erste Bank and Raiffeisen Bank, had reported Croatia to the International Court for Settlement of Investment Disputes (ICSID) in Washington for violation of their legal personality and profit loss. The case has to do with a law on the conversion of loans pegged to the Swiss franc to euro-indexed loans, adopted by the previous, SDP-led government, which caused a cost of around eight billion kuna for banks operating in Croatia.

Aleksic, whose association represents holders of loans indexed in the Swiss franc, said that banks had not filed a lawsuit but rather wanted the court to establish if Croatia had had the right to pass such a law. Croatia, he added, is a signatory to an agreement obligating it to respect the outcome of the arbitration.

"State officials failed in recent months to sit at the table with bankers and tell them that their assets would be taxed if they requested arbitration. However, if it is established in the arbitration that the state should not have adopted the loan conversion law and that Croatia should return money to the banks, it still won't be late to introduce taxes on bank assets," Aleksic said, explaining that in that case, banks would not be given back the money they were claiming because the situation would be even.

Last update: Wed, 23/03/2016 - 11:53
Author: 

More from Croatia

Stier: Cyber-attack may have come from east, unrelated to PM's Ukraine visit

Foreign Minister Davor Ivo Stier said on Saturday that no strategic piece of information was compromised in a cyber-...

Subspace hostel with space pods opens in Zagreb

As of December 1, Zagreb has a new tourist attraction, the futuristic Subspace hostel, the first in the European...

Remaining Kiowa Warrior helicopters for Croatian army delivered

Eleven OH-58D Kiowa Warrior military helicopters were delivered to the Croatian Air Force base in Zemunik on...

Croatia needs change and SDP must start it, says opposition leader

Newly elected Social Democratic Party (SDP) president Davor Bernardic said in Zagreb on Saturday that Croatia needed...

Minister says buying controlling interest in INA worth the challenge

State property Minister Goran Maric said in an interview with the Jutarnji List daily on Saturday that the INA oil...