Parliament pans SPP sale

IN A MOVE questioned by both lawyers and opposition, the Slovak parliament has approved a report stating that the state was ripped off in the blockbuster sale of 49 percent of its major gas utility in 2002, and that the deal, overseen by the previous government led by Mikuláš Dzurinda, was not done transparently.

IN A MOVE questioned by both lawyers and opposition, the Slovak parliament has approved a report stating that the state was ripped off in the blockbuster sale of 49 percent of its major gas utility in 2002, and that the deal, overseen by the previous government led by Mikuláš Dzurinda, was not done transparently.

The report also claims that several laws were violated during the privatisation of the Slovenský Plynárenský Priemysel (SPP) gas company. The opposition, made up of parties that formed the former government, left the discussion hall in protest while lawyers continued to argue that, in democratic countries, only courts can decide if a law was violated.

Prime Minister Robert Fico has stated several times that the $2.7-billion US (Sk61.9 billion) deal, one of the largest privatisation deals under Dzurinda, was the biggest heist in Slovak history.

On February 5, parliament requested that the government, at the initiative of MP Pavol Frešo of the Slovak Democratic and Christian Union (SDKÚ), make public all the contracts pertaining to the privatisation of the gas utility.

Meanwhile, Vladimír Mečiar, chairman of the Movement for a Democratic Slovakia (HZDS), said that the SPP privatisation contract as a whole might actually be invalid and that Slovakia should go to the international arbitration court in England, the SITA newswire reported.

Mečiar also said that the former government artificially squeezed the price of the 49-percent stake down to $2.7 billion.

But Ivan Mikloš, former finance minister and deputy chairman of the SDKÚ, said that Fico was just spreading lies about the privatisation deal.

Meanwhile, lawyers stressed that only the courts should decide whether a law has been broken and that the parliament has no jurisdiction to do so.

In democratic countries, power is divided into executive, legislative and judicial branches and each of these have their functions. Parliament, the legislative branch, exists to adopt laws and should not intervene in the functions of the executive and judiciary branches, said Pavel Nechala, lawyer with the Transparency International Slovensko.

"Parliament is definitely not the body that should deal with issues like this one," Nechala told The Slovak Spectator. "Parliament should only pass good laws and regulate the environment in which the other branches function."

According to Nechala, the report passed by parliament cannot have any legal impact.

It is more of a political and declaratory matter that is trying to influence legal proceedings, he added.

President of the Institute of Public Affairs Grigorij Mesežnikov agrees that the parliamentary resolution has strong political overtones.

The ruling Smer party was trying to drown out some recent scandals that have affected the ruling coalition, such as the land fund scandal or the dubious tender for cleaning works announced at the Defence Ministry, said Mesežnikov.

"The case is only propaganda," Mesežnikov told The Slovak Spectator. "It will have no other practical importance."

Prosecutor General Dobroslav Trnka also said that the report approved by the parliament is not likely to have any impact on the investigation.

"The report adopted by the Slovak parliament - in whatever way it was adopted - has only a declaratory character because it declared only what we have been doing for three weeks," Trnka told the economic daily Hospodárske Noviny.

Mesežnikov even doubted the objectiveness of the report and its contribution to the transparency of the report since it has evolved around a report prepared by the Economy Ministry.

"We also know that it was prepared at the order of the ruling coalition," Mesežnikov said. "Only a report prepared by an independent entity could have contributed to transparency."

The report said the gas utility was sold below the market value of the company, which in 2000 was estimated at $6 billion to $8 billion. The state could have charged from $3 billion to $4 billion for the 49-percent stake in 2002, the government argued.

In its resolution, the parliament stated that the law on the conditions of state property transfer had been breached, which in result damaged the state's options to execute its rights as the SPP majority owner, SITA wrote.

The public procurement law was also breached when a privatisation advisor was picked, and, due to fluctuating exchange rates, Slovakia incurred a loss of €236.25 million, the report said, according to SITA.

According to the report, Slovakia suffered a loss of Sk257.5 million as a result of what the report calls the "unlawful payment of a bonus to the privatisation advisor".

Mikloš insisted that the resolution is a flagrant violation of the constitution, as parliament is not entitled to decide whether laws have been breached, because only a court can do so.

(Ľuba Lesná contributed to the report)

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