CEDH · CASELAW;CLIN;ENG — 3 novembre 2009

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Bosnia and Herzegovina - 27912/02 Judgment 3.11.2009 [Section IV] Article 1 of Protocol No. 1 Article 1 para. 2 of Protocol No. 1 Control of the use of property Delays in implementation of Bosnia and Herzegovina’s repayment scheme for foreign currency deposited before the dissolution of the SFRY: violation   Article 46 Article 46-2 Execution of judgment Measures of a general character Delays in implementation of Bosnia and Herzegovina’s repayment scheme for foreign currency deposited before the dissolution of the SFRY; respondent State required to take specific remedial measures   Facts – The applicant had deposited foreign currency he had earned abroad in the 1970s and 1980s with a bank in Tuzla* during the era of the Socialist Federal Republic of Yugoslavia (SFRY), but was prevented from withdrawing his deposits after emergency measures were introduced by the SFRY following a monetary crisis in the 1980s. The restrictions remained in force in different forms during the ensuing period, which saw the break-up of the SFRY, the declaration of independence of Bosnia and Herzegovina, the outbreak of war, the Dayton Agreement and economic and other structural reforms. In 2006 new legislation was introduced offering a revised scheme for the repayment of the foreign-currency deposits. Under the Old Foreign-Currency Savings Act 2006 Bosnia and Herzegovina undertook to repay outstanding deposits with accrued interest, calculated at the agreed contractual rate till the end   of 1991 and at a reduced rate of 0.5% a year from 1   January 1992 until 15   April 2006 (the Constitutional Court later considered this reduced rate justified in view of the need to reconstruct the national economy following the war). Depositors whose claims had been verified were entitled to an initial cash payment with the balance to be reimbursed in government bonds earning interest at an annual rate of 2.5%. The exact arrangements for the issue of the bonds were left to the three constituent units of the State of Bosnia and Herzegovina (the Federation of Bosnia and Herzegovina, Republika Srpska and Brčko District ) . In the Federation, the bonds were to be amortised by March 2015 in eight instalments. In his complaint to the European Court, the applicant complained, inter alia , of the arrangements in place for the repayment of his foreign-currency savings and of delays in both the payment of the instalments and the issue of the bonds. Law – Article 1 of Protocol No.   1: The fundamental issue before the Court was whether the domestic legislation on “old” foreign-currency savings complied with the conditions laid down in Article   1 of Protocol No.   1. The Court limited its analysis to the legislation enacted in 2006. It accepted that the control of the use of the applicant’s possessions was lawful and in the public interest. It further noted that, having assumed full liability for “old” foreign-currency claims in locally based banks, the respondent State had been unable to allow the uncontrolled withdrawal of deposits because, in all probability, they had been spent by the former SFRY regime. The core question was thus whether the legislation introduced to deal with this problem and the implementation of that legislation had struck a fair balance between the demands of the general interest of the community and the requirements of the protection of the individual’s fundamental rights. As to the legislation itself, the Court found that it was compatible with the Convention as, given the catastrophic effects of the war and the ongoing reforms of the economic structure, the solution whereby the applicant was to receive his entire “old” foreign-currency savings in eight instalments by 2015 remained within the State’s margin of appreciation. In that connection, the Court noted that there was no reason to suppose that the bonds would not hold their nominal value (bearing in mind the experience in Republika Srpska where they were trading for around 90% of their issue value) and that, in any event, depositors could opt for cash payments in eight instalments instead. Likewise, the fact that the interest rate provided on the deposits for the period from 1992 until 2006 was considerably lower than that offered in other SFRY successor States was not sufficient to render the legislation contrary to Article   1 of Protocol No.   1. Turning to the question of the implementation of the legislation, however, the Court found that the measures taken had been unsatisfactory in two of the constituent units (the Federation and Brčko District), with delays of several months occurring both in the issue of government bonds and the payment of instalments. While the Court was aware that “old” foreign-currency savings, inherited from the SFRY, constituted a considerable burden on all successor States, the rule of law and the principle of lawfulness required the Contracting Parties to respect and apply, in a foreseeable and consistent manner, the laws they had enacted. Owing to the deficient implementation of its legislation on “old” foreign-currency savings, the respondent State had failed to comply with that obligation. Conclusion : violation (unanimously). Article 46 of the Convention: In view of the number of similar applications pending before it, the Court considered it appropriate to apply the pilot-judgment procedure. By way of general measures the respondent State was required to ensure that the Federation of Bosnia and Herzegovina issued government bonds and paid any outstanding instalments within six months of the pilot judgment becoming final and that it undertook to pay default interest at the statutory rate in the event of future delays in payment. While the Court did not find it necessary to order adequate redress be made to everyone affected by past delays, it indicated that it may reconsider that issue if the general measures were not adopted. The Court adjourned for six months similar pending applications concerning deposits in the Federation and Brčko District in cases where the applicants had obtained certificates verifying their claims, and advised that it may declare inadmissible applications in which no verification certificate had been obtained or which concerned savings in Republika Srpska. Conclusion : respondent State required to take general measures (unanimously). Article 41: EUR 5,000 in respect of non-pecuniary damage. (See also Kovačić and Others v.   Slovenia [GC], nos.   44574/98, 45133/98 and 48316/99, 3   October 2008, Information Note no.   112) * Tuzla is located in what is now the Federation of Bosnia and Herzegovina, one of the three constituent units of the State of Bosnia and Herzegovina.   © Council of Europe/European Court of Human Rights This summary by the Registry does not bind the Court. Click here for the Case-Law Information Notes