STA, 12 June 2019 - The Ministry of Environment and Spatial Planning has confirmed the decision of the Environment Agency on the controversial gas extraction project in Petišovci (NE), thus rejecting an appeal by UK investor Ascent Resources. In line with the decision, a separate permit procedure will be needed for hydraulic fracturing.

The agency granted the investor the permit for a planned gas processing plant but demanded a separate environmental impact assessment to determine whether the UK company can step up extraction via hydraulic fracturing, which is crucial for the refinery that would be allowed to process 280,000 cubic metres of natural gas and a tonne of oil per day.

The March decision of the Environment Agency came after the original permit for the refinery, issued in 2015, had been successfully challenged by environmentalists.

The Ministry agrees with the agency that an environmental impact assessment and a separate environmental permit were necessary because the location was close to water sources and because underground waters and agricultural land in the area do not have very good ability to regenerate.

Operating in a joint venture with Geoenergo, which is co-owned by the Slovenian state-controlled energy companies Petrol and Nafta Lendava, the UK company wants to extract gas on a large scale in Petišovci.

The separate permit procedure could further delay the implementation of the project in which more than EUR 50 million has allegedly been invested so far.

The UK company holds 75% interest in the project, Geoenergo's concession for the Petišovce gas however expires in 2022.

Hydrocarbon extraction in Petišovci started in 1943 and boomed in the 1980s. But after the oil refinery there was closed, the activity slowly died down.

Last December, Ascent Resources stepped up pressure on Slovenia to issue the environmental permit for its project by threatening to sue the government for damages.

This was after the then Environment Minister Jure Leben ordered an internal inquiry at the Environment Agency to see "whether inappropriate pressure has been exerted on employees" in relation to two Petišovci-related procedures.

The inquiry showed that there had been pressure and threats in both procedures and that the autonomy and independence of the decision-making authority had been violated. The findings prompted Joško Knez to resign as the agency's director.

All our stories on this project are here

STA, 12 June 2019 - In a bid to improve the status of tenants but also landlords, the opposition Left (Levica) has filed a bill to limit commissions for renting real estate and costs which real estate agencies can charge to their clients.

The changes to the law on real estate agencies, which bring commission limits similar to those in place for real estate sales, were submitted to parliament on Wednesday, the Left said in today's press release.

Tenants would no longer have to pay commissions for services provided by a real estate agency which was hired by the landlord.

Landlords would benefit from a cap on commissions that can be charged by apartment rental agencies; the capped amount would correspond to one monthly rent, but would not go lower than 150 euro.

The Left believes tenants in apartments rented out at market prices should benefit the most since they will no longer have to pay commission for the services they have not commissioned and since landlords would be encouraged to rent out their apartments for longer periods.

MP Matej T. Vatovec said the bill was harmonised with the Ministry of the Environment and Spatial Planning and endorsed by coalition representatives, so the Left expected it to be passed in parliament.

However, even if such changes are set down in a deal between the government coalition and the opposition party which supports the government, coalition MPs did not contribute their signatures.

"The coalition's decision to support the bill or not [in parliament] will show whether it is serious about cooperation with the Left, and will also serve as the basis to decide how to proceed cooperation-wise," Vatovec was quoted in the release as saying.

STA, 12 June 2019 - The Grand Chamber of the European Court of Human Rights (ECHR) held an oral hearing on Wednesday in Slovenia's case against Croatia over Croatian companies' debt to the defunct Ljubljanska Banka (LB). Slovenia presented the lawsuit as substantiated and admissible.

The government said after the hearing that this had been "the first opportunity for Slovenia to present its arguments and evidence concerning violations committed to the detriment of LB in 48 proceedings before Croatian courts".

Slovenia argues that Croatian judicial and executive authorities have been systematically preventing LB, the biggest bank in the former Yugoslavia, from recovering debts incurred by Croatian companies in the 1990s.

This is even though Slovenia as the bank's owner has had to settle the bank's debt to the retail clients who held their savings deposits with the bank.

Slovenia's claim to just satisfaction amounts to EUR 429.5 million, a figure calculated on the basis of an appraisal of LB's assets conducted by an auditing firm.

Ana Polak Petrič, Slovenia's high representative for succession, pointed out before the ECHR Grand Chamber that the European Convention on Human Rights "guarantees rights to all natural and legal persons".

"The rejection of Slovenia's application by the Court would imply that state-owned legal entities do not enjoy such rights and that the Court is unable to guarantee the protection of their rights," she said.

Slovenia's arguments were presented before the court by Ben Juratowitch, head of the Slovenian legal counsel, who said "Slovenia's application is substantiated and admissible and Slovenia has the right to refer Croatia's breaches to the court in an inter-state application".

Polak Petrič told the press after the hearing that she hoped the key Slovenian arguments had been presented successfully, a key argument being Article 33 of the European Convention on Human Rights "which gives Slovenia the right to file an inter-state application if it finds another Council of Europe member violated the rights stemming from this convention".

Polak Petrič said that these rights apply to all natural and legal persons, including state-owned and that Slovenia met all the admissibility criteria.

Slovenia therefore argues that Croatia's objection regarding the admissibility of the application is unfounded. Any other interpretation by the court would result in a precedent with far-reaching effects, also paving the way for arbitrary and unequal treatment of state-owned companies operating in foreign countries, the press release says.

It adds that in the interest of the international community, outstanding disputes should be resolved as soon as possible and in a peaceful manner, which is of particular importance for the region that is dealing with many unresolved issues.

"Based on the principle of the rule of law and the trust in international justice, Slovenia has brought this outstanding issue before the ECHR" - Slovenia brought the application in 2016.

A video recording of the hearing released by the court shows that today's debate focused mainly on the question of LB's role in relation to the state.

Croatian lawyer Jeremy McBride argued that LB was an entity operating in the interests of the state and was in fact a governmental organisation which he said was not entitled to bring applications before the court.

Polak Petrič and Juratowich countered the claim in detail, emphasizing that the main point was that through their arbitrary conduct the Croatian government and judiciary authorities sought to protect Croatian companies from their debt to the bank being enforced.

They noted that former Croatian Finance Minister and Deputy Prime Minister Slavko Linić boasted in 2015 that as minister he banned any payments being made to LB.

ECHR judges inquired mostly about LB's status and how it is associated with the state. Juratowich underscored that LB was not a government body and was not part of the state apparatus.

Even though state-owned, it is not a state entity nor does it have special powers and has never performed public functions, Juratowich argued.

He also noted that the bank was not state-owned when it issued loans to Croatian companies. The Croatian central bank revoked in 1991 LB's right to operate in Croatian territory, so the Slovenian lawyer said it was ironic of Croatia to claim that the bank was no longer operational.

Slovenia took ownership of LB through a 1994 constitutional law, but still the supervisory board which includes state representatives cannot affect the management's decisions, Juratowich explained.

Given the usual practice in inter-state applications, Slovenia expects the court's decision on the admissibility of its application by the end of 2019 or in the first half of 2020.

The Strasbourg court had already decided on LB claims against Croatian companies in June 2015, but ruled the case, brought by the defunct bank, inadmissible because the bank was state-owned.

Governmental bodies or public companies under the strict control of a state are not entitled to bring an individual application before the ECHR. The court did not deliberate on the case substantively.

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STA, 11 June 2019 - Coalition parties are mostly in favour of somehow suspending the privatisation of Abanka, although opinions differ and at least some advocate the position that commitments must be honoured. In any case, it appears that the government will have the final say.

Abanka is supposed to be privatised by the end of the month according to commitments Slovenia made in exchange for EU clearance of state aid. But just weeks before the due date Prime Minister Marjan Šarec cast doubt on the procedure by calling for a re-examination of the commitments.

His party, the Marjan Šarec List (LMŠ), thinks it is necessary to clarify what went on in the run-up to the bailout, a reference to ongoing police investigations of the circumstances of the 2013 bailout.

"We'll see what goes on in the coming days and weeks. But these are things that cannot be resolved fast. The government will have to adopt a position and we have to clarify what had been going on," LMŠ deputy group leader Brane Golubović said on Tuesday.

Similarly, the Social Democrats (SD) think a reconsideration is in order. The government should "decide whether to carry out the sale or not, and whether to negotiate new terms with the Commission at least until court procedures regarding the correctness of the calculation of the bank capital shortfall are ongoing," deputy group chair Matjaž Han said.

The Modern Centre Party (SMC) shares the SD's opinion. "We advocate the position that the government should reconsider and, if necessary, stop the sale," deputy group leader Igor Zorčič said, adding that his party was "against unnecessarily selling state assets".

Only the Pensioners' Party (DeSUS) thinks obligations Slovenia made should be honoured. "The state has made some commitments regarding the bank and will probably have to realise them," the party said, but added that it would still be good if Slovenia had one state-owned bank.

The SAB, led by Alenka Bratušek, prime minister during the bailout, pointed out the coalition agreement said the government would try to convince Brussels it did not have to sell Abanka. But since the Finance Ministry has to its knowledge not yet launched the talks, "this indicates that we will probably sell Abanka".

Given that Slovenia has managed to rescue its banks with its own money and the economy without the intervention of the troika, the right approach could result in the Commission not insisting on the sale, the SAB believes.

The Finance Ministry would not comment on the issue.

The privatisation of Abanka had been considered a foregone conclusion until last Friday when Šarec cast doubt on the plan by saying on Twitter that SSH, which manages equity in companies on behalf of the state, may have to reconsider the move.

The tweet came after the public broadcaster RTV Slovenija aired a documentary about the 2013 bailout a day earlier, raising questions in particular about the role of the European Commission in ordering that junior creditors of three banks be wiped out.

SSH said yesterday it had to stick to the commitment to sell Abanka, which Slovenia made when it received clearance for state aid, but it also said that the government could take a final decision on the bank's sale.

The European Commission has said it expects Slovenia to honour its commitments.

STA, 10 June 2019 - The shareholders of NLB bank on Monday confirmed the proposal to pay out EUR 142.6 million in dividends at EUR 7.13 per share, and endorsed all new candidates for the supervisory board.

Mark William Lane Richards, Shrenik Dhirajlal Davda and Gregor Rok Kastelic have been appointed new supervisors and Andreas Klingen was reappointed effective on 11 June.

The management has been authorised to buy NLB up to 36,542 own shares on the organised market over the next 36 months to be used in remuneration packages.

It also received a discharge of liabilities despite a counterproposal by a shareholder who also proposed that the shareholders task the management with making provisions for lawsuits brought by wiped-out junior creditors.

The motion was rejected because it is not within the purview of the shareholders to do that.

Chairman Blaž Brodnjak described 2018 as a very special year since the bank was privatised, which will allow it to conduct business free of limitations imposed by the EU due to state aid commitments once the state has reduced its stake to 25% plus one share.

"When another 10% is sold, it will be able to breathe with full lungs and start competing on a level playing field," he said.

As for business prospects, Brodnjak said the trends were good but indicated the bank was remaining vigilant since the region where it operates is very open and hence susceptible to external shocks.

Since last year's initial public offering, NLB's ownership is dispersed among small domestic shareholders and foreign institutional investors.

The state's stake has been reduced to 35%, but it is expected to be reduced further by the end of the year to 25% plus one share.

One benefit of the state no longer exerting majority control is that the board members are no longer subject to pay restrictions imposed on managers of state-owned companies.

Supervisory board president Primož Karpe said the debate about future remuneration packages has been concluded and pay levels will range from EUR 340,000 to EUR 420,000 gross starting with salaries for June.

This is a significant improvement from current levels: the annual report for 2018 shows that CEO Brodnjak got EUR 192,000 last year, while foreign board members got slightly more, up to EUR 210,000.

"We reached a consensus in the end, bearing in mind that we wanted a stable and motivated board," Karpe said about the new remuneration packages.

STA, 10 June 2019 - Ways of encouraging economic cooperation, especially trade and investment, were in the focus of Monday's meeting in Ljubljana between Japan's State Minister of the Economy, Trade and Industry Yoshihiro Seki and Slovenia's State Secretary Aleš Cantarutti.

Bilateral trade reached EUR 196.3 million in 2018, which makes Japan Slovenia's 32nd largest trade partner, the Ministry of Economic Relations and Technology said in a release, noting "Japan's investments contributed to Slovenia's excellent economic performance in 2018".

Cantarutti and Saki also discussed NEDO, a three-year Japanese-Slovenian project developing smart networks, and Society 5.0, a Japanese initiative focusing on the question of how to utilise modern scientific and technological breakthroughs for the benefit of all segments of society.

The ministry said Society 5.0 was an area in which Slovenia and Japan should continue cooperation, as this would be one of the priorities during Slovenia's EU presidency in 2021.

Signing a bilateral agreement on regular air traffic and a deal on flights between air carriers Adria Airways and ANA would be according to the ministry very important for Slovenia, as an increasing number of Japanese tourists visits Slovenia.

Seki, on the other hand, pointed to the Slovenian law on foreigners, which he said made it very hard to obtain all the necessary work permits.

Cantarutti welcomed the idea for Slovenia to take part in the EXPO 2025 in Osaka, and the Olympics Tokyo will host in 2020 were highlighted as another area with a great potential for bilateral cooperation.

STA, 6 June 2019 - Home appliances producer Gorenje will lay off 104 workers, which is fewer than the initially presented figure of 270, the in-house trade union said on Thursday.

Of the 1,481 workers planned to be laid off, 1,377 will be offered a new contract and the rest will be sacked, SKEI Gorenje said as it received the lay-off plan from the management.

Gorenje employs over 4,200 workers in Slovenia and abroad, and is amid reorganisation following last year's takeover by China's Hisense and EUR 37 million in net loss.

The union fears this is just the first step towards more lay-offs, which is in contradiction with Hisense's announcements about production expansion and new hirings.

It also insists that the former Gorenje management should be held responsible for the wrong decisions which had caused the group to sink into the red.

The union said social dialogue in the company was worrying; the management set the amount of the annual holiday allowance unilaterally, even if this is not in line with the collective bargaining agreement, noting the allowance was lower than in 2017.

The union blames such moves on the Slovenian advisers to the Chinese owners, which however risk falling out of favour with the employees.

Some trade unionists have according to SKEI Gorenje already received anonymous threats to be careful what they tell the media.

SKEI Gorenje thus announced it would fight for workers' rights with all means.

The management, on the other hand, said the new contracts had been checked by the trade union and some of its remarks taken into account.

The workers will start getting new contracts on Monday, a process planned to be completed by the end of June.

Earlier this year, Gorneje announced the majority of the planned redundancies would not affect production workers but cleaners, security staff and warehouse workers.

Meant to provide for Gorenje's sustainable growth and development, the reorganisation was said to apply to the entire group not the just the parent company in Velenje.

Gorenje generated almost EUR 1.2 billion in sales revenue last year, a 1.7% drop compared to 2017, finishing the year in the red.