{"id":12097,"date":"2024-12-09T12:10:24","date_gmt":"2024-12-09T11:10:24","guid":{"rendered":"https:\/\/ustavbih.ba\/article-ii-human-rights-and-fundamental-freedoms\/f-article-ii-5-refugees-and-displaced-persons\/groups-of-cases\/old-foreign-currency-savings\/"},"modified":"2024-12-09T17:11:54","modified_gmt":"2024-12-09T16:11:54","slug":"old-foreign-currency-savings","status":"publish","type":"page","link":"https:\/\/ustavbih.ba\/en\/article-ii-human-rights-and-fundamental-freedoms\/f-article-ii-5-refugees-and-displaced-persons\/groups-of-cases\/old-foreign-currency-savings\/","title":{"rendered":"\u201cOld foreign currency savings\u201d"},"content":{"rendered":"

In cases of so-called old foreign currency savings<\/i>, the Human Rights Chamber dealt with a further problem consisting of failed socialist economic solutions and war consequences. The applicants had been holders of foreign currency savings accounts in (then) domestic banks long before the war. Already in the 1980s access to foreign currency was limited in a way, as there was the intention to strike a balance between the scarce foreign currency needs of fiscus<\/i>, on one hand, and economic \u201cbottlenecks\u201d, on the other. Prior to the beginning of the armed conflict the majority of holders of foreign currency savings accounts were completely prevented from accessing their foreign currency savings. A great number of civil actions brought by holders were not solved or were solved unsuccessfully. In cases where courts granted claims, the financial administration would, in principle, refuse to enforce such judgments. In 1997 and 1998, the Federation of BiH tried to solve the problem of \u201cthe old foreign currency savings\u201d, in the process of privatisation, in order to accommodate the holders of foreign currency savings accounts, on the one hand, and, on the other, to avoid the ruin of the budget and banking system of the Entities. Instead of cash payments, holders of foreign currency savings accounts (similarly to the rest of creditors who had claims against the state in respect of unpaid wages, pensions etc.) were restricted in using their foreign currency savings, whereby they received the so-called certificates instead, which, then again, they could invest in privatisation of real property or socially- owned, i.e.<\/i>, state-owned enterprises. However, the applicants preferred cash payments, especially when it turned out that certificates had in the market just a minor portion of their nominal value. The two-year time limit which was provided for certificates to be used, considering constant delays in the process of privatisation in practice, was too short, so that the pressure on certificates holders was all the greater. In addition, numerous holders of foreign currency savings accounts with minor foreign currency amounts, when it came to the imposed solution of the problem, were let down and the fate of their claims was uncertain. In its first in a series of adopted decisions, which were extremely controversial within the Human Rights Chamber, the Human Rights Chamber gave, in principle, \u201cthe green light\u201d for the solution established by the Federation of BiH. However, the Chamber held that the solution was disproportional and that it was not in conformity with the right to property under the ECHR. The Human Rights Chamber held that Bosnia and Herzegovina was responsible for the situation related to \u201cthe old foreign currency savings\u201d. Naturally, the Chamber only requested from the Federation of BiH to improve the legal solutions, as it considered that, under the BiH Constitution and a framework law at the State level, it was competent to do so.2414<\/sup><\/span><\/p>\n

The Federation of BiH undertook amendments to the relevant legislation in the period from November 2000 to February 2002. The situation got additionally complicated over the judgment of the Constitutional Court of the Federation of BiH of 8 January 2001, which held that the main solutions related to the issuance and use of certificates were in contravention of the Constitution of the Federation of BiH, and accordingly it rendered ineffective the relevant provisions. In practice, the judgment of the Constitutional Court of the Federation of BiH, nevertheless, was not in effect \u2013 provisions rendered ineffective were still applied. This fact was a consequence of the Federation of BiH not knowing how to proceed following the judgment, given that the judgment was, for the major part, without adequate reasoning.2415 <\/sup><\/span>Besides, the Federation of BiH found it much easier to start enforcing a decision of the Human Rights Chamber on \u201cthe old foreign currency savings\u201d, which was adopted shortly before, where the Chamber established that certain provisions related to \u201cthe old foreign currency savings\u201d violated standards of the ECHR. Therefore, the Federation of BiH was ordered to improve the respective provisions. However, the mentioned provisions were not the subject of the judgment of the Constitutional Court of the Federation of BiH. Precisely for this reason, the Federation of BiH, obviously, of two obligations selected the one which suited it better. Finally, it was important that the Federation of BiH lodged an appeal against the judgment of the Constitutional Court of the Federation of BiH with the BiH Constitutional Court. Unfortunately, the BiH Constitutional Court, at the time, and much after that, de facto was not in a position to deliberate on the appeal.<\/p>\n

Namely, that was when the five-year mandate of judges from the first line- up was due to expire and when new judges for the BiH Constitutional Court were being selected. Consequently, the BiH Constitutional Court decided on the appeal only in the end of 2003, so as to reject it as untimely.2416<\/sup><\/span><\/p>\n

In the end of 2002, the Human Rights Chamber, in a series of cases, again assessed very confusing legislation relating to \u201cfrozen\u201d accounts of \u201cthe old foreign currency savings\u201d. Although it held that amendments to the existing regulations were per se acceptable, the Chamber adopted a decision stating that the Federation of BiH lacked legal grounds to act in relation to \u201cthe old foreign currency savings\u201d, as the Constitutional Court of the Federation of BiH rendered ineffective certain provisions. This brought about legal uncertainty which kept the applicants in suspense, so that the Federation of BiH still continued interfering with the rights to property of the applicants in a disproportionate manner.2417<\/sup><\/span><\/p>\n

After some months elapsed again, and the Federation of BiH or BiH failed to undertake steps to enforce the decision of the Chamber, in July 2003, in the case Poropat et al. and Todorovi\u0107 et al.,2418 <\/sup><\/span>the Chamber imposed a decision on further legal remedies, i.e., financial compensation to all applicants. Shortly before the expiry of its mandate (31 December 2003), the Chamber upheld its previous case law in relation to the unresolved situation with the holders of \u201cthe old foreign currency savings\u201d accounts in the case \u0110urkovi\u0107 et al. The Chamber again ordered the Federation of BiH to settle the continuous legal uncertainty by May 2004, so as to adopt the necessary laws and decrees creating a clear legal framework, which would offer concrete and reliable information to the holders of \u201cthe old foreign currency savings\u201d accounts, thereby observing the public interest, and the principle of proportionality.2419<\/sup><\/span><\/p>\n

The issue of regulating the payment of \u201cold foreign currency savings\u201d was resolved only upon the enactment of a new law in 2004.2420 <\/sup><\/span>During 2005, the Human Rights Commission within the BiH Constitutional Court put \u201cunder scrutiny\u201d the conformity of the respective law with the standards referred to in Annex 6 to the Dayton Peace Agreement. Namely, in the case Besarovi\u0107 et al.,2421 <\/sup><\/span>the Human Rights Commission within the BiH Constitutional Court concluded that the payment of old foreign currency savings was the exclusive responsibility of the State. Admittedly, the State has discretion to delegate its competence to the Entities due to technical, economic or other justified reasons, thereby being mindful of the right to property of the damaged persons and of the equality of legal solutions for all citizens throughout the territory of BiH.2422 <\/sup><\/span>However, the State failed to give a guarantee for such a solution. On the other hand, regulations in the Federation of BiH, which were in force at the time, were in contravention of Article 6 of the ECHR and Article 1 of Additional Protocol No. 1 to the ECHR.2423 <\/sup><\/span>In order to help the State legislature, which was not willing to find solutions up until that time, the Human Rights Commission within the BiH Constitutional Court gave very detailed instructions on how to solve the problem. There was a similar situation with the regulations in the RS.2424<\/sup><\/span><\/p>\n

In December 2005, the BiH Constitutional Court declared unconstitutional the entire set of regulations of the Federation of BiH, the Republika Srpska and the Br\u010dko District concerning \u201cold foreign currency savings\u201d, because these administrative and territorial units did not have the legitimacy to regulate the respective issue. The BiH Constitutional Court obliged the State to adopt within 3 months a framework law on \u201cold foreign currency savings\u201d.2425 <\/sup><\/span>By this decision, the BiH Constitutional Court to a great extent prevented the State and the Entities from implementing the decision of the Human Rights Commission within the BiH Constitutional Court in terms of implementing the ordered reforms.2426<\/sup><\/span><\/p>\n

Under the Law on the Settlement of the Obligations arising from the Old Foreign Currency Savings Accounts2427 <\/sup><\/span>the decision of the BiH Constitutional Court No. U 14\/05 was implemented, as well as the decision \u2013 though only partly \u2013 of the Human Rights Commission within the BiH Constitutional Court in the case Besarovi\u0107 et al. at the State level. Still, the Law on Conditions and Manner of Settlement of Debts arising from the Old Foreign Currency Savings Accounts by Issuance of Bonds in the Republika Srpska2428 <\/sup><\/span>derogates from the total system of payment of \u201cold foreign currency savings\u201d which was stipulated.2429<\/sup><\/span><\/p>\n","protected":false},"excerpt":{"rendered":"

In cases of so-called old foreign currency savings, the Human Rights Chamber dealt with a further problem consisting of failed socialist economic solutions and war consequences. The applicants had been holders of foreign currency savings accounts in (then) domestic banks long before the war. 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