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External Relations

The Succession of the Former SFRY

The Agreement on Succession Issues signed in Vienna on 29 June 2001 came into force on 2 June 2004, upon ratification by all successor states (Croatia was the last to ratify, in March 2004). Annex C constitutes an integral part of this Agreement, and regulates the distribution of financial assets and liabilities of the former SFRY, of which 38% was allocated to the Federal Republic of Yugoslavia.

From the day the Agreement was signed until December 2014, the Committee for the Distribution of Financial Assets and Liabilities of the former SFRY, consisting of representatives of all successor states, met nineteen times with the aim of implementing Annex C. The Committee achieved significant results in terms of the implementation of Annex C and the distribution of the assets of the SFRY.

In an effort to resolve the issue of distribution of foreign assets of the National Bank of the former SFRY frozen in accounts with foreign banks and in line with the initiative of the U.S. Administration, foreign assets amounting to around USD 237 million blocked in the accounts of American banks were distributed in April 2003 according to the percentages stipulated by the Agreement.

The effort to deal with the financial clearing issues between successor parties resulted in an agreement that regulates the non-convertible, clearing debt of the Russian Federation towards the former Yugoslav republics worth a total of 1.3 billion clearing dollars. In this respect, a multilateral Memorandum between the Government of the Russian Federation and the Respective Governments of Successor States of the Former SFRY on the Regulation of Mutual Financial Claims Arising from Commodity Exchange between the Former SFRY and the Former USSR was signed on 17 September 2003. The bilateral agreement regulating the debt of the Russian Federation towards the Republic of Serbia worth USD 288.8 million was signed on 27 April 2007 and has been fully implemented.

The representatives of successor states decided in May 2005 that the mechanism and methodology used in the distribution of monetary gold deposited with the BIS in Basel should be applied to the remaining monetary gold of the National Bank of the former SFRY in line with the percentages specified in the Agreement.

In July 2005, the representatives of successor states concluded an agreement on the distribution of foreign assets in the amount of around USD 221 million frozen on accounts of the National Bank of the former SFRY with banks abroad (except in the USA where these assets were unblocked and distributed in 2003). The above assets have been distributed according to the percentages stipulated by the Agreement on Succession Issues.

Pursuant to the agreement on the settlement of obligations under outstanding guarantees issued by Vojni servis (Military Service) of the National Bank of the former SFRY, potential obligations under those guarantees will be assumed by specific enterprises from the territories of all successor states that were the end-beneficiaries of assets under operations for which the guarantees were issued.

In February 2006, an agreement was reached on the distribution of share capital of the former SFRY in Jubmes banka a.d. Beograd in accordance with the percentages stipulated by the Agreement on Succession Issues.

Since 10 July 2006, when the Republic of Serbia and the Republic of Montenegro signed the Agreement on the Regulation of Membership in International Financial Organisations and the Distribution of Financial Assets and Liabilities, unallocated financial assets and liabilities between these two countries have been distributed in accordance with Article 2 of this Agreement, specifying a 94.12% share for the Republic of Serbia and a 5.88% share for the Republic of Montenegro. If these shares are applied to the 38% share allocated to the FRY under the Agreement on Succession Issues, the Republic of Serbia receives 35.7656% and Montenegro 2.2344% of the financial assets and liabilities of the former SFRY determined in Annex C to the Agreement.

Receivables in the clearing accounts of Albanian banks with the National Bank of the former SFRY worth USD 23.8 million have been distributed by the Committee for the Distribution of Financial Assets and Liabilities pursuant to the percentages stipulated in Annex C of the Agreement on Succession Issues, which was confirmed by the conclusion of the multilateral Memorandum between the Republic of Albania and the Respective States of the Former SFRY on 14 December 2010. Albanian debt from the clearing period worth USD 8.5 million has been regulated by a bilateral Agreement between the Republic of Albania and the Republic of Serbia on 31 March 2011 and is regularly serviced by the Albanian side.

In its next meetings, the Committee will consider the remaining issues pertaining to the distribution of financial assets and liabilities of the former SFRY.