Final Award

The Arbitral Tribunal was not able to take a decision within the prescribed time limit, so the Award on the Dispute over the Inter-Entity Boundary in the Brčko Area was taken on 14 February 1997,³⁵⁷⁹ whereby the High Representative for Bosnia and Herzegovina, who was established under Annex 10 of the Dayton Peace Agreement, was ordered, inter alia, to appoint his Deputy (Supervisor) for Brčko, who would have powers as large as those of the High Representative, which are expressly defined in the Supplemental Award on the Dispute over the Inter-Entity Boundary in the Brčko Area, dated 15 March 1998.³⁵⁸⁰ On 5 March 1999 the Arbitral Tribunal took a Final Award,³⁵⁸¹ including an Annex³⁵⁸² which was amended on 18 August 1999³⁵⁸³ The 1997 and 1998 Decisions are incorporated in the Final Award.

The Final Award consists of 10 chapters and 69 paragraphs. The first two chapters describe the factual situation – the position of Brčko and the necessity to find a solution – and give the summary of conclusions. Chapter III includes Chapter I and describes the difficulties impeding repatriation of different ethnic groups and the establishment of a local multi-ethnic government. Paragraph 9 and some parts of paragraphs 34 and 36 (Chapter IV) govern the basic structure of the District. It should have a single unitary multi-ethnic democratic government to exercise those powers previously exercised by the two Entities and the three municipal governments. The single District government consists essentially of (a) the District Assembly; (b) an Executive Board, to be selected by the Assembly; (c) an independent judiciary, to consist of two courts, trial and appellate, and (d) a unified police force operating under a single command structure, with complete independence from the police establishments of the two entities. The District falls under the exclusive sovereignty of Bosnia and Herzegovina. All powers and rights of both Entities are suspended and transferred to the District (paragraphs 9, 10, 34, 36 and 61). Paragraph 37 et seq. deals with the authority and the responsibilities of the Supervisor, out of which one of the most important responsibilities is to prepare and to adopt a new “Statute for District Government” (paragraph 38). The said Statute entered into force on 7 December 1999.³⁵⁸⁴

In Chapter V, the Arbitral Tribunal took the liberty to give some “recommendations” to the High Representative and the International Community for rebuilding the District, although it was clear that the Arbitral Tribunal could not go further than giving “the recommendations”. It is strenuously emphasised that one of the major causes of tension in the Brčko area is its general economic depression and high rate of unemployment (paragraph 49). Chapter VI separately deliberates on the manner in which the Arbitral Tribunal takes into account the various interests of the parties involved: the Republika Srpska, the Federation of Bosnia and Herzegovina and the International Community. The legal effect of the Final Award is described in Chapter VII. In paragraph 34 it is already stated that the District Government will be an institution existing under BiH sovereignty, it will be subject to BiH control in those areas that are included under the responsibility of the joint institutions of Bosnia and Herzegovina. Other issues (paragraph 58) encompassed by the Final Award are consistent with the BiH Constitution as part of the Dayton Peace Agreement.

This particularly relates to Article I.3 of the BiH Constitution, which stipulates that Bosnia and Herzegovina consists of two Entities. The entire territory of Brčko is held in “condominium” by both Entities, and, consequently, it does not constitute a third entity (the “condominium” arrangement). Pursuant to Article V.5 of Annex 2 to the Dayton Peace Agreement, the decision shall be final and binding, and the Parties shall implement it “without delay.” Pursuant to paragraph 61 of the Final Award, both entities shall be deemed to have delegated all of their powers of governance in the prescribed area to the District Government as of the effective date designated by the Supervisor. According to Article III.3 of the BiH Constitution, subsequently (after the delegation of powers), all authorities of the District, from the constitutional point of view, shall continue to be “governmental functions and powers of the Entities.” Chapters VIII through X contain interim and final provisions.

The Annex to the Final Award, as an integral part thereof, provides guidelines on the structure of the District, to be taken into account by the Supervisor in preparing the Statute of the Brčko District. The Annex is composed of 13 paragraphs. All residents of the District who are citizens of BiH shall have the right to decide to be also a citizen of one or the other entity (but not both), regardless of where they live in the District. No resident of the District shall be treated by either Entity as being subject to entity taxes or compulsory military service (paragraph 1). As to the election of members of the District Assembly (paragraph 2), the Supervisor may, if he deems it necessary, devise and incorporate into the Statute (1) an “ethnic formula” designed to minimize the incentive for any ethnic group to seek to increase its population in the District in order to achieve exclusive political control, and/or (2) a provision relating to the protection of “vital interests”, as also regulated by Article IV.3(e) of the BiH Constitution, in terms of preventing over-voting in cases where “essential issues” of each people arise. The Executive Board (a collegiate body) and a District Manager are responsible for the management of the Brčko District (paragraphs 3 and 4). In addition, the Statute may also incorporate an “ethnic formula” relating to Executive Board membership. Paragraph 5 relates to the judicial and penal system of the District. Paragraph 6 stipulates that a three- member law revision commission shall be appointed with responsibility for drafting a uniform system of laws throughout the District. Paragraphs 8 and 9 relate to the Law Enforcement and Customs Service. Voting and symbols of the District are regulated in paragraphs 10 and 11. The education Curriculum is ethnically regulated in a uniform manner (paragraph 12). The Supervisor shall have authority to transfer the ownership of public assets to the District Government and to establish a system of regulation for the operation of public utilities and enterprises.