22.  The applicants are Croatian nationals. 23.  Mr Ivo Kovačić was born in 1922 and lived in Zagreb. He died on 17 July 2004, in the course of the proceedings. His relatives have elected to pursue the application before the Court (see paragraph 3 above). 24.  Mr Marjan Mrkonjić was born in 1941 and lives in Zurich (see paragraph 2 above). 25.  Mrs Dolores Golubović was born in 1922 and lived in Karlovac. She died on 15 October 2004. Her nephew has elected to pursue her application before the Court (see paragraph 3 above). 26.  Before the dissolution of the Socialist Federal Republic of Yugoslavia (“the SFRY”), the applicants or their relatives all deposited hard foreign currencies in savings accounts with the office of a Slovenian bank – the Ljubljana Bank (in Slovenian: Ljubljanska banka) – in Zagreb (Croatia). Some of them also held term accounts which matured in the late 1980s or early 1990s. At the time the Ljubljana Bank was one of the major commercial banks of the SFRY with offices in other Republics. 27.  The bank now called the Ljubljana Bank was founded in 1955 and subsequently underwent several changes of status and name. 28.  In 1969 its legal predecessor opened an office in Zagreb in the then Socialist Republic of Croatia. It was re-registered in 1974 and in 1977. 29.  From 1978 until 1 January 1990 the Ljubljana Bank Head Office (Ljubljanska banka – združena banka), a company existing under the laws of the then Socialist Republic of Slovenia, operated as an “associated bank”. It was made up of Ljubljana Bank Basic Banks and carried on business in accordance with the principles of the socialist self-management system then in operation. 30.  Over much the same period, from 1977 until 1990, the Ljubljana Bank's Zagreb office operated as a “basic bank”, being neither a branch nor a subsidiary of the Ljubljana Bank Head Office. 31.  The Ljubljana Bank - Basic Bank Zagreb (in Croatian: Ljubljanska banka - Osnovna Banka Zagreb) had separate legal personality under the law of the then Socialist Republic of Croatia and was financially and economically independent. It was, however, integrated into the organisational structure of the Ljubljana Bank. 32.  On 19 December 1989 the Ljubljana Bank Head Office was re-registered as a joint stock company (delniška družba, “d.d.”) with effect from 1 January 1990. 33.  On 29 December 1989 the Ljubljana Bank Basic Bank Zagreb was re-registered as the Zagreb Main Branch (Glavna filijala Zagreb) with effect from 1 January 1990.
(b)  The system of redepositing foreign-currency savings 34.  Individuals were allowed to open foreign-currency savings accounts in the SFRY from 1965 onwards. Annual interest on savings accounts was comparatively high, reaching levels of 10% and more. From 25 December 1969 until the dates on which each successor State declared its independence, all foreign-currency deposits were covered by the Federation's (“the SFRY's”) statutory guarantee (see section 76 of the Banks and Other Financial Institutions Act, Official Gazette of the SFRY, no. 10/89, paragraph 166 below). 35.  In 1977 a system by which commercial banks redeposited foreign-currency savings with the National Bank of Yugoslavia (“the NBY”) in Belgrade was introduced by the Foreign Exchange Operations and International Credit Relations Act (Official Gazette of the SFRY, no. 15/77). Pursuant to section 51(2) of that Act, the NBY was under an obligation to accept foreign-currency savings deposited with authorised banks and to grant interest-free loans in Yugoslav dinars (YUD) to the bank depositing the foreign currency. The dinar loans were credited to local companies in the Republic where the banks were located. Although the SFRY banks were not required by law to transfer the foreign-currency deposits to the NBY, it is generally agreed that, in practice, they had no other option. This system freed commercial banks from the risk of loss due to exchange rate differences. 36.  From 1978 to 1988 further legislation regulating the redeposit transactions was passed. One of the decisions adopted in 1978 introduced the so-called “pro-forma” or “accounting” method of redepositing foreign exchange in order to save considerable sums that would otherwise have gone towards fees for neutral transactions. In the following years, only approximately 14% of foreign-currency deposits were actually transferred by the commercial banks to the NBY. 37.  From 1985 onwards redepositing banks were required to pay interest on the previously interest-free loans in YUD granted in exchange for the foreign currency redeposited with the NBY. 38.  On 15 October 1988 the system of redeposits was brought to an end by amendments to the Foreign Exchange Transactions Act (Official Gazette of the SFRY no. 59/88, see paragraph 165 below). The amended section 14(4) provided that “[t]he conditions and procedure applicable to the obligations arising under the guarantee [should] be regulated by a separate federal law”. As no such law was enacted, the remedies employed by the SFRY were based on ad hoc decrees. Only banks, not individual depositors, were entitled to demand payment of foreign-currency deposits. A bank had to be insolvent or bankrupt before any payment could be made under the guarantee. 39.  In 1991 the foreign-currency claims of commercial banks against the NBY amounted to approximately 12,000,000,000 US dollars (USD) and remained frozen.
(c)  The monetary crisis and the Marković reforms 40.  The problems resulting from the foreign and domestic debt of the SFRY caused a monetary crisis in the 1980s, with the SFRY economy suffering hyperinflation. The banking and monetary systems were on the verge of collapse and the SFRY resorted to emergency measures. Among other developments, legislation imposing restrictions on the repayment of foreign-currency deposits to individuals was introduced (see section 71 of the Foreign Exchange Transactions Act, paragraph 165 below). 41.  1989 was a year of reforms for the SFRY in which many legislative, institutional and structural adjustments were made to prepare the transition from the socialist planned economy into a market-oriented one (the so-called Marković reforms, named after the then Prime Minister Mr Ante Marković). According to the respondent Government, these reforms, which also included rehabilitation measures, should have been implemented in full within two years but the dissolution of the SFRY prevented this. 42.  The reform of the banking system under the Banks and Other Financial Institutions Act (Official Gazette of the SFRY no. 10/89) provided for the conversion of associated and basic banks into joint stock companies. 43.  In 1988, 1989 and 1990 the SFRY assumed liability for the foreign-currency related losses and payment of the foreign-currency deposits with the NBY by converting the foreign exchange-rate differences into public debt. Since in 1991 the servicing of public debt was not regulated, the NBY passed a resolution granting banks special liquidity loans in order to enable withdrawals of foreign-currency deposits. In addition, the amount of foreign currency that could be withdrawn was further restricted. 44.  This general situation lasted until June 1991, when the process of disintegration of the SFRY started. The whole process took place over several months as four of the six Republics proclaimed their independence.
(d)  The Ljubljana Bank and the Zagreb Main Branch
(i)  Background 45.  In 1988 the Ljubljana Bank's foreign-currency accounts were frozen. 46.  On 19 December 1989 the Ljubljana Bank joint stock company was established in Ljubljana, in the then Socialist Republic of Slovenia. The change was entered in the Register of Companies the same day and became effective on 1 January 1990. 47.  Article 60 of the Ljubljana Bank's memorandum and articles of association of 19 December 1989 provided that the Ljubljana Bank would take over the rights, assets and obligations of the Ljubljana Bank Head Office and, among others, the Basic Bank of Zagreb as a legal successor on the day of its formation or registration in the Register of Companies. 48.  On 29 December 1989 the Ljubljana Bank Basic Bank Zagreb was reregistered in the Zagreb Commercial Court (Trgovački sud) as the Zagreb Main Branch (Glavna filijala Zagreb) with effect from 1 January 1990.
(ii)  Matters in dispute concerning the legal position and banking liabilities of the Zagreb office of the Ljubljana Bank at the material time
(α)  Events as related by the respondent Government 49.  The respondent Government maintained that the dissolution of the SFRY had prevented the full conversion of the Ljubljana Bank Basic Bank Zagreb into the Zagreb Main Branch. Thus, the status, operations, assets and liability for deposits of the Zagreb Main Branch had become a State succession issue. 50.  During the two-year interim period of the Marković reforms, the so-called “main branches” which had operated previously as basic banks had had a sui generis status fundamentally different from that of a “branch” as known to Western European legal systems. In particular, such main branches could be rehabilitated under section 25 of the Rehabilitation, Liquidation and Solvency of Banks and Other Financial Institutions Act (see paragraph 168 below). In 1990 the rehabilitation of the Zagreb Main Branch was initiated but the dissolution of the SFRY prevented its completion.
(β)  Events as related by the intervening Government 51.  As far as the status of the Zagreb office was concerned, the intervening Government stated that at the material time the Zagreb Main Branch had existed as an integral part of the Ljubljana Bank, that there had been an institutional relationship of dependency, and that the Ljubljana Bank was liable with all its assets and with no restrictions for the Zagreb Main Branch's obligations. This state of affairs arose from the decision on the organisational structure of the Ljubljana Bank joint stock company adopted by its assembly on 19 December 1989, as confirmed by the extract from the Register of Companies of the Ljubljana Basic Court of 29 December 1989. Moreover, even before that decision, when the Zagreb office had functioned as a “basic bank” with its own legal status, it had not enjoyed financial independence in foreign-currency operations. 52.  On 25 June 1991 the National Assembly of the Republic of Slovenia enacted the Fundamental Constitutional Charter on the Sovereignty and Independence of the Republic of Slovenia and the Constitutional Law relating to the Fundamental Constitutional Charter on the Sovereignty and Independence of the Republic of Slovenia (Official Gazette of the RS no. 1/91).
(a)  The Constitutional Law relating to the Fundamental Constitutional Charter on the Sovereignty and Independence of the Republic of Slovenia 53.  By virtue of section 19(3) of the Constitutional Law, the Republic of Slovenia became guarantor of all foreign-currency savings deposited with banks on Slovenian territory at that date (see paragraph 170 below).
(b)  Developments after independence 54.  In October 1991 a new Slovenian currency was introduced, the Slovenian tolar (SIT). 55.  In October 1991 a Bank Rehabilitation Agency was established with the principal task of conducting a rehabilitation programme. 56.  On 4 February 1993 the constitutional-law guarantee was implemented by the Discharge of Liability for Unpaid Foreign-Currency Deposits Act (Official Gazette of the RS no. 7/93, see paragraph 172 below). Under section 2 of that Act, liabilities arising out of foreign-currency deposits became part of the Slovenian public debt. Further implementing legislation was passed in 1995. 57.  Thus, foreign currency deposited with banks on Slovenian territory became part of the public debt in the form of bonds totalling approximately 1,500,000,000 German marks (DEM) and the account holders were able to make withdrawals, regardless of the location of the head office of their bank or of their nationality. 58.  On 11 March 1993 the Republic of Slovenia Succession-Fund Act (Official Gazette of the RS no. 10/93, see paragraph 173 below) came into force. Under that Act, a number of claims and obligations of the Republic of Slovenia and its official bodies vis-à-vis the SFRY and its subordinate bodies, including the NBY, were assigned to the Succession Fund. 59.  On 28 June 1994 the Convention and Protocol No. 1 came into force in respect of Slovenia.
(c)  The 1994 amendments to the 1991 Constitutional Law
(i)  Background 60.  According to the Slovenian Government, in 1991 the Ljubljana Bank represented 42.4% of the Slovenian banking market. However, both before and after the dissolution of the SFRY the Ljubljana Bank accumulated substantial negative capital. For this reason, the Government decided that rehabilitation measures were urgently required to prevent the collapse of the Slovenian financial system and such measures were taken in 1993. In that year, the Republic of Slovenia became the Ljubljana Bank's sole shareholder. 61.  The Ljubljana Bank's financial position was further jeopardised by two kinds of succession risks in the absence of any agreement between the Successor States: firstly, a claim by foreign creditors for USD 4,200,000,000 under an agreement known as the New Finance Agreement (NFA); and, secondly, the continued exposure to the SFRY's liability for redeposited foreign exchange outside Slovenian territory. 62.  The authorities decided in 1994, as part of the rehabilitation measures, to amend the 1991 Constitutional Law in order to protect the public interest, as is reflected in the preamble to the 1994 Act (see paragraph 171 below).
(ii)  The legislation 63.  On 27 July 1994 the National Assembly amended the 1991 Constitutional Law (Official Gazette of the RS no. 45/94, see paragraph 171 below) so as to restructure the Ljubljana Bank by creating a new and separate legal entity (section 22(č)), the New Ljubljana Bank. It was formed as a joint stock company which took over all of the former bank's assets and liabilities on Slovenian territory. The former bank, the Ljubljana Bank, retained its rights against and obligations towards the SFRY (section 22(b)) and its former constituent republics: in particular, full obligations in respect of the foreign-currency ordinary and deposit accounts that were not guaranteed under section 19 of the 1991 Constitutional Law, that is to say, those contracted outside Slovenian territory (see paragraph 170 below). 64.  That law also laid down that the Ljubljana Bank would continue to deal with branches and subsidiaries whose head offices were situated in other republics of the territory of the SFRY and retain the rights to the corresponding portion of the debt owed by the NBY in respect of the foreign-currency savings accounts. 65.  The Bank Rehabilitation Agency remained the owner of the Ljubljana Bank.
(d)  The decision of the Slovenian Constitutional Court 66.  On 11 April 1996 the Constitutional Court (Ustavno sodišče) dismissed a constitutional initiative (ustavna pobuda) brought by a Croatian savings-account holder, Mr Vukasinović, challenging the constitutionality of the 1994 Constitutional Law, holding that it had no jurisdiction to hear it (see paragraphs 176 and 177 below).
(e)  Developments subsequent to the decision of the Slovenian Constitutional Court 67.  On 5 July 1997 an amendment to the Republic of Slovenia Succession-Fund Act (Official Gazette of the RS no. 40/97, see paragraph 174 below) came into force. It provided for a stay of any proceedings directly or indirectly affecting legal relations with the SFRY involving the so-called “succession-related claims”, pending resolution of the succession arrangements. The proceedings were to be reinstated ex officio once the succession arrangements had been resolved. By virtue of section 15(č) of the Act, the statutory provisions were binding on the Slovenian courts. 68.  On 29 June 2001 the Agreement on Succession Issues was signed in Vienna by Bosnia and Herzegovina, Croatia, the Federal Republic of Yugoslavia (later Serbia and Montenegro), the Former Yugoslav Republic of Macedonia and Slovenia. It entered into force on 2 June 2004 (see paragraphs 186 and 187 below). 69.  On 15 July 2004 the Transformation of the Succession Fund of the Republic of Slovenia and the Establishment of the Succession Agency of the Republic of Slovenia Act was passed, which repealed the Republic of Slovenia Succession-Fund Act. 70.  On 21 February 2005 the Court requested information from the respondent Government regarding implementation of the aforementioned Act (see paragraphs 14 above and 105 below). 71.  The respondent Government replied that that Act was in the process of being implemented. They added that, in any event, further to the ratification of the Agreement on Succession Issues and in conformity with Article 7 of Annex G to that Agreement and with Article 8 of the Constitution (see paragraphs 186 and 169 below), the proceedings relating to succession issues had resumed in the Slovenian courts, since ratified and published international treaties took precedence over statutory provisions and, in particular, section 15(č) of the Republic of Slovenia Succession-Fund Act. They produced a number of decisions by the Slovenian courts ordering the resumption of such proceedings. 72.  On 17 March 2005 the Constitutional Court ruled that the Transformation of the Succession Fund of the Republic of Slovenia and the Establishment of the Succession Agency of the Republic of Slovenia Act was unconstitutional since it did not provide for the resumption of the proceedings that had been stayed under the Republic of Slovenia Succession-Fund Act until the establishment of the Succession Agency. 73.  On 21 March 2006 further legislation – the Republic of Slovenia Succession-Fund and the Republic of Slovenia Senior Representative for Succession Act (Official Gazette of the RS no. 29/06, see paragraph 175 below) – was passed. Section 23 of that Act provided that any stay of proceedings in the Slovenian courts relating to foreign currency deposited in a commercial bank or a branch office of a commercial bank in any successor State of the SFRY was to remain in force. Proceedings that had since been resumed were to be stayed again until a solution was found to the question of the guarantees to be provided by the SFRY or the NBY under Article 7 of Annex C of the Agreement on Succession Issues (see paragraph 186 below). 74.  On 25 June 1991 the Croatian Parliament adopted the Declaration on the Sovereignty and Independence of Croatia and enacted the Constitutional Act on the Sovereignty and Independence of Croatia. On 8 October 1991 Croatia became independent. 75.  In December 1991 a Croatian currency was introduced, the Croatian dinar, which was replaced in 1994 by the Croatian kuna (HRK).
(a)  Adoption of the SFRY's finance regulations and assumption of the guarantee for savings in Croatia 76.  On 26 June 1991 the Act on the Applicability to Croatia of the SFRY's Finance Regulations was passed. By virtue of that Act, which entered into force on 8 October 1991 (Official Gazette of the Republic of Croatia no. 71/91, see paragraph 182 below), forty-two federal statutes and five decisions of the Federal Executive Council concerning foreign-currency savings were incorporated into Croatian law. 77.  On 23 December 1991 the Government issued the Decree on the Conversion of Nationals' Foreign-Currency Bank Deposits into the Croatian Public Debt (Official Gazette of the RC no. 71/91, see paragraph 183 below). Under the Decree, savings that had been deposited before 27 April 1991 with banks whose head office was situated in Croatia (“Croatian banks”) or that were transferred by Croatian nationals into Croatian banks from other banks within 30 days from the entry into force of the Decree became, subject to compliance with Articles 15 and 16 of the Decree, part of the Croatian public debt. Only Croatian citizens were entitled to the conversion of their foreign-currency savings into public debt. None of the applicants made use of this possibility. 78.  The 1991 Decree provided for payment of the foreign-currency deposits in national currency in twenty half-yearly instalments starting on 30 June 1995 and bearing interest at an annual rate of 5%. Further legislation was subsequently passed on this subject. 79.  According to the respondent Government's submissions before the Chamber, about two-thirds of the account-holders at the Zagreb Main Branch transferred their former savings accounts to Croatian banks, which in turn transferred their claims to Croatia. Thus, approximately DEM 450,000,000 became Croatian public debt. 140,000 Croatian depositors allegedly kept their accounts at the Zagreb Main Branch. The amount of their deposits came to approximately DEM 300,000,000 at that time. Of the remaining depositors, 96,000 had less than the equivalent of 30 euros (EUR) in foreign-currency savings standing to their credit. 80.  In 1991 a Decree was adopted which prohibited the disposal or encumbering of real property on Croatian territory owned by legal entities whose head office was outside Croatia.
(b)  Other developments 81.  On 24 February 1996 the Croatian Payment Transaction Institute froze the Zagreb Main Branch's company account. On 14 July 2000 the Croatian authorities closed the Zagreb Main Branch's giro account. 82.  On 25 October 2002 the Court invited Slovenia and Croatia to submit any documents that might serve as evidence of the existence or absence of an institutional and financial relationship of dependence between the Ljubljana Bank and the Zagreb Main Branch. 83.  On 5 December 2002 the Court additionally requested both Governments to provide further information on whether or not the funds on deposit with the Zagreb Main Branch had been effectively transferred to the Ljubljana Bank following the Marković reforms, and if so, the amounts transferred in Yugoslav dinars and in hard currencies.
(a)  The Ljubljana Bank's Annual Reports 84.  The Slovenian Government submitted the Ljubljana Bank's Annual Reports for the years 1989, 1990, 1991, 1992 and 1993. They stated that no annual reports for the Zagreb Main Branch existed, only balance sheets (see paragraphs 88 and 89 below). 85.  In the Ljubljana Bank's 1990 Annual Report, the assets and liabilities of the Zagreb Main Branch were included for the first and only time. 86.  On page 23 of the Ljubljana Bank's 1991 Annual Report, it is stated that the balance sheets of the Ljubljana Bank and the Zagreb Main Branch could not be consolidated because of the political situation in Croatia and in Bosnia and Herzegovina. The Ljubljana Bank had little or no control over the activities of its operations in those two countries and had little prospect of being able to transfer any funds to Slovenia in the foreseeable future. The same situation was noted in the 1992 and 1993 Annual Reports. 87.  The respondent Government submitted before the Grand Chamber that following the implementation of the 1994 Constitutional Law, approximately USD 612,000,000 remained with the Ljubljana Bank.
(b)  The Zagreb Main Branch's accounts
(i)  The fact as submitted by the respondent Government 88.  The respondent Government submitted the Ljubljana Bank Basic Bank Zagreb's balance sheet for 1989 and the Zagreb Main Branch's balance sheets for 1990, 1991, 1994 and 2001. 89.  In 1991 the amount of foreign-currency redeposited by the Zagreb office with the NBY came to 13,600,000,000 Croatian dinars (USD 619,000,000), whereas foreign-currency deposits with the Zagreb office came to 10,700,000,000 Croatian dinars (USD 490,000,000), which according to the respondent Government confirmed that 100% of the foreign-currency deposits with the Zagreb office were subsequently redeposited. 90.  The amount of foreign currency deposited by the Zagreb office with the NBY exceeded its liabilities towards foreign-currency depositors. This was due to the fact that some foreign-currency deposits had been paid out in Yugoslav dinars or from the current inflow of foreign currency. No transfer of foreign-currency deposit funds from Croatia to Slovenia had ever occurred. 91.  Before the Grand Chamber, the respondent Government submitted that the current assets of the Zagreb Main Branch amounted to approximately EUR 525,000,000, including immovable and movable property, and far exceeded the sum of all foreign-currency deposits with the Zagreb Main Branch, estimated at EUR 172,000,000.
(ii) The facts as submitted by the intervening Government 92.  The intervening Government stated that further to the Marković reforms, the National Bank of Slovenia had become the regulatory authority for the Ljubljana Bank; on that date the Zagreb Main Branch's claims to foreign-currency deposits redeposited with the NBY were transferred to the National Bank of Slovenia and the funds on deposit at the National Bank of Croatia were transferred from Zagreb to new accounts in Ljubljana. 93.  However, the intervening Government stressed that the correct answer to the question concerning the actual foreign-currency movements could be given only after comprehensive and independent financial examination by an expert of the Ljubljana Bank's activities. 94.  Before the Grand Chamber the intervening Government stated that they were not aware of any real estate in Croatia owned by the Ljubljana Bank which would allow a large number of savers to settle their claims. 95.  After the dissolution of the SFRY, the successor States were unable to negotiate a succession treaty owing in particular to the ongoing violence in the region. 96.  The succession talks were first conducted within the framework of the International Conference on Former Yugoslavia. 97.  As no tangible results were achieved, the succession issues were included in the tasks of the High Representative in Bosnia and Herzegovina, who was appointed pursuant to the General Framework Agreement for Peace in Bosnia and Herzegovina. 98.  In March 1996 Sir Arthur Watts was appointed Special Negotiator to assist the Successor States in reaching an agreement. Numerous rounds of negotiations were held. 99.  On 29 June 2001 the Agreement on Succession Issues (“the Agreement”) was signed in Vienna by Bosnia and Herzegovina, Croatia, the then Federal Republic of Yugoslavia, the Former Yugoslav Republic of Macedonia and Slovenia. Article 4 of the Agreement established a Standing Joint Committee to monitor the effective implementation of the agreement and to discuss issues arising in the course of its implementation (see paragraph 186 below). 100.  The Agreement stipulated, inter alia, that the SFRY's foreign financial assets should be distributed to the successor States in the following proportions: Bosnia and Herzegovina 15.5%, Croatia 23%, the Federal Republic of Yugoslavia 38%, the Former Yugoslav Republic of Macedonia 7.5% and Slovenia 16%. 101.  By virtue of Article 2 § 3(a) of Annex C to the Agreement, the SFRY's financial liabilities to be distributed among the successor States included “guarantees by the SFRY or its NBY of hard currency savings deposited in a commercial bank and any of its branches in any successor State before the date on which it proclaimed independence”. 102.  Article 7 of Annex C provided: “[g]uarantees by the SFRY or its NBY ... shall be negotiated without delay taking into account in particular the necessity of protecting the hard-currency savings of individuals. This negotiation shall take place under the auspices of the Bank for International Settlements ['the BIS']”. 103.  In 2001 and in 2002, negotiations regarding hard-currency savings did take place under the auspices of the BIS, but no solution was found. 104.  All successor States have ratified the Agreement, Croatia being the last country to do so. It entered into force on 2 June 2004. 105.  On 21 February 2005 the Court requested both the respondent and the intervening Governments to inform it of any developments concerning the negotiations referred to in Article 7 of Annex C. In addition, the respondent Government were invited to inform the Court whether or not the Standing Joint Committee had met or been convened (see paragraphs 14 and 70 above). 106.  The respondent Government, in their reply dated 31 March 2005, stated that the first formal meeting of the Standing Joint Committee had not been convened as it should have been. They had repeatedly urged the convening of the meeting so that the issue of the frozen bank accounts could be discussed. 107.  The intervening Government, in their reply dated 30 March 2005, stated that no discussion had taken place regarding the guarantee for hard-currency savings which would be relevant to the applicants' situation. 108.  In their submissions to the Grand Chamber, the respondent Government stated that meetings of the Standing Joint Committee had taken place on 6 June 2005 and 18 June 2007. They had requested that the distribution of the SFRY assets be put on the agenda but Croatia had opposed that request. The next meeting was to be held in Belgrade later that year and they would be renewing their request. They had also informed the BIS of their willingness to resume the negotiations in any event. 109.  In their submissions to the Grand Chamber, the intervening Government stated that the guarantees covered by Article 7 of Annex C related only to banks that were declared bankrupt, which was not the case of the Ljubljana Bank (see paragraph 38 above). Therefore, the foreign savings of the Zagreb Main Branch could not be the subject of further negotiations under the Agreement. Nevertheless, in the context of the State succession negotiations, Slovenia had included claims based on the Zagreb Main Branch savings in the NBY. On this basis, its share of the assets for distribution was 20% higher. 110.  The unpaid foreign-currency savings deposited with the Zagreb Main Branch have also been the subject of frequent bilateral negotiations between Slovenia and Croatia, but no final agreement has been achieved. 111.  A bilateral Agreement on the Regulation of Property Rights between Slovenia and Croatia entered into force on 23 February 2000. The first article of that agreement provides that relations between Slovenia and Croatia concerning the Zagreb Main Branch shall be governed by agreements to be concluded between the two States (see paragraph 184 below). 112.  Mr Kovačić's wife held a foreign-currency savings account with the Zagreb Main Branch. Mr Kovačić himself was also a client of the Zagreb office for over 30 years. 113.  On 24 October 1984 the applicant and his wife signed a three-year automatically renewable term-deposit agreement for DEM 66,771.12 earning 12.5% interest a year. The agreement stipulated, inter alia, that the SFRY would guarantee their savings. The last withdrawal from the account was made in August 1990. 114.  On 10 September 1990 Mr Kovačić attempted to withdraw DEM 40,000 from the account. As the term had not yet expired, the bank manager turned down his request and suggested that he should return after 24 October 1990, the date of maturity. On 25 October 1990 the bank manager offered monthly payments of DEM 4,000. However, no payments were made. 115.  Mr Kovačić and his wife made repeated attempts to obtain payment. They were informed by the bank on 17 April 1991 that it was unable to make any payments, as its relations with the NBY had not been determined and the Yugoslav foreign exchange market was not functioning. 116.  According to a bank statement of 14 October 1993, the amount standing to the credit of the account was then DEM 49,794.30. 117.  Following the bank's refusal, the applicant brought a civil action against “the Ljubljana Bank, Zagreb Main Branch” in the Zagreb Municipal Court (Općinski sud) claiming payment of the savings with interest. On 2 December 1997 the court found, inter alia, that Mr Kovačić had inherited the foreign-currency savings account in question from his wife, who had died in the meantime. It ordered “the Ljubljana Bank, Zagreb Main Branch” to pay the applicant within fifteen days the savings plus default interest; according to the applicant, the sum came to a total of DEM 61,000. 118.  The court also held that, as the bank's head office was not on Croatian territory, the provisions of the Decree on the Conversion of Nationals' Foreign-Currency Bank Deposits into Croatian Public Debt could not apply, as Mr Kovačić had not transferred his deposits to a Croatian bank. On 22 April 1998 the ruling became final and enforceable. 119.  Mr Kovačić then made an application for execution of that decision to the Zagreb Municipal Court, which issued a warrant of execution in his favour on 1 October 1998. The court later stayed the execution proceedings. 120.  In 1998 Mr Kovačić attempted to withdraw his funds, firstly from the Zagreb Main Branch and subsequently from the Ljubljana Bank in Ljubljana. On 6 July and on 14 September 1998 he was informed by bank officials that the bank had no funds and the account was frozen.
(b)  Proceedings in Slovenia 121.  On 7 December 1998 Mr Kovačić made an application to the Ljubljana District Court (Okrožno sodišče) seeking a declaration regarding the extent to which the Croatian judgment of 2 December 1997 was enforceable. On 21 June 1999 the District Court authorised him to enforce the Croatian judgment. However, Mr Kovačić has not sought to enforce the judgment of 2 December 1997 through the Slovenian courts.
(c)  Subsequent proceedings in Croatia 122.  On 24 December 2001 Mr Kovačić sought the registration of a charge over land in Osijek (Croatia) belonging to the Zagreb Main Branch. 123.  On 5 March 2003 the Osijek Municipal Court granted his application. On appeal, on 5 June 2003 the Osijek County Court (Županijski sud) upheld that judgment. It also held that with the entry into force of the Agreement on the Regulation of Property Rights between Slovenia and Croatia (see paragraph 184 below) and a subsequent decision which was adopted on 27 April 2002, the ban on disposing of the real property belonging to the Ljubljana Bank had been lifted. 124.  In 2003 forty-two individuals, including Mr Kovačić and Mr Mrkonjić, lodged requests for the seizure and sale of real estate owned by the Ljubljana Bank (see paragraph 152 below). 125.  On 17 July 2003 Mr Kovačić obtained a warrant of execution for the amount of DEM 49,794.30 (EUR 25,459.42) plus interest in arrears from 1 January 1992 until the date of payment and the costs of the proceedings for obtaining the charging order in the amount of HRK 2,967.42 (EUR 406,49) and the costs of the subsequent enforcement proceedings. 126.  On 30 March 2004 the Zagreb Main Branch's assets were liquidated for HRK 3,903,000 (EUR 534,657.53) in the enforcement proceedings started by a Croatian savings-account holder, Mr B. Several other account holders joined those proceedings. A ruling was handed down on 9 April 2004. 127.  On 24 May 2004 the proceeds of sale were deposited with the Osijek Municipal Court. On 15 July 2004 a hearing on the division of the proceeds of sale was held at the Osijek Municipal Court. 128.  On 20 July 2004 the Osijek Municipal Court rendered a decision dividing up the proceeds of sale. Mr Kovačić was awarded HRK 291,306.60 (EUR 39,905) (for the main debt and the costs) and Mr Mrkonjić HRK 180,515.72 (EUR 24,728) (for the main debt and costs), both payable into Mr Žugić's account. Both were also awarded the costs of the enforcement proceedings. A number of the judgment creditors, including the two applicants, lodged an appeal against that decision in respect of the court fees (see paragraph 153 below). 129.  On 21 October 2004 the Osijek County Court quashed the decision and remitted the case. 130.  On 28 February 2005 a hearing was held. On 8 April 2005 the Osijek Municipal Court gave a new decision concerning the division of the proceeds of sale. 131.  The relevant parts of that decision read:
“The Osijek Municipal Court ... decided: 18. Ivo Kovačić (I-Ovr-186/02 and I-Ovr-128/02), represented by the attorney Milivoje Žugić from Zagreb, the amount of HRK 15,742.62 [EUR 2,156.50] payable into the attorney Milivoje Žugić's giro account ... with the Economic Bank (Privredna banka d.d. Zagreb).
...
In the aggregate, compensation for the costs of the enforcement proceedings totals HRK 404,193.80 [EUR 55,369]. To this amount shall be added ... the amount of HRK 23,180 [EUR 3,175] to the judgment creditors represented by the attorney Milivoje Žugić [for the appellate proceedings ...
III. The following claims shall be settled out of the proceeds of sale:
... 18. Ivo Kovačić from Zagreb – the claim referred to in writs of execution nos. I-Ovr-186/02 and I-Ovr128/02 for the part relating to court fees in the amount of HRK 2,967.42 [EUR 406] payable into the attorney Milivoje Žugić from Zagreb's giro account ... with the Economic Bank, and the main claim in the amount of HRK 288,339.18 [EUR 39,498.50], which together total HRK 291,306.60 [EUR 39,905].” 132.  Mr Kovačić and Mr Mrkonjić appealed against that decision, again on the ground that they were entitled to a higher award of costs. On 7 July 2005 the Osijek County Court dismissed the appeal. The decision of 8 April 2005 thus became final. 133.  On 20 July 2005 Mr Kovačić received payment of his foreign-currency deposits in full, together with the costs awarded. 134.  Mr Mrkonjić holds a foreign-currency savings account at the Zagreb Main Branch. 135.  On 18 July 1984 he made a payment into the account. On 18 July 1987 he signed an automatically renewable three-year term agreement for a deposit of 26,754.26 Swiss francs (CHF) earning 12.5% interest a year. 136.  On 2 May 1993 he closed the account by notice in writing but was unable to withdraw the remaining balance. According to a bank statement of 30 July 1993, the amount of his savings plus accrued interest at that time came to CHF 31,265.92. 137.  On 30 July 1993 Mr Mrkonjić brought a civil action in the Croatian courts to recover his savings plus interest. On 23 August 1994 the Zagreb Municipal Court ordered “the Ljubljana Bank, Zagreb Main Branch” to pay him the money due, namely CHF 31,265.92, plus default interest. The Zagreb Main Branch subsequently appealed. Its appeal was dismissed on 12 September 1995 by a court of appeal. 138.  According to Mr Mrkonjić, on 28 December 1995 he withdrew part of his savings (CHF 7,850.07) from his account. 139.  On 23 July 1997 the Zagreb Main Branch paid Mr Mrkonjić part of the principal together with court fees.
(b)  Attempts by the applicant to withdraw the remainder of his savings 140.  In 1998 Mr Mrkonjić wrote several letters to the Ljubljana Bank in Slovenia asking to be allowed to withdraw his money. 141.  On 10 November 1998 a bank official informed him that his money had been deposited with the NBY and that immediately after Slovenian and Croatian independence, the bank's access to the deposits in Belgrade had been suspended. Slovenia and Croatia were attempting to find a solution to outstanding issues, which included the “old savings accounts”. 142.  On 9 December 1998 Mr Mrkonjić was informed by the bank official that Slovenia and Croatia had agreed that the problem of the “old savings accounts” would be resolved by international arbitration. He was given the same information on 18 January 1999 and 3 January 2000. 143.  In 2000 and 2001 Mr Mrkonjić again made several requests to the Ljubljana Bank and the Zagreb Main Branch for the withdrawal of his money. By letters of 4 April 2000, 20 and 22 February, 26 June and 16 July 2001, bank officials informed him that no solution had been found. 144.  On 12 February 2001 Mr Mrkonjić requested the registration of a charge over land belonging to the Zagreb Main Branch in Osijek to secure the payment of his outstanding debt amounting to CHF 26.845,61 with interest. His request was granted on 12 March 2002 by the Osijek Municipal Court, but the Osijek County Court overturned that judgment on 25 April 2002. However, on 27 February 2003, the Supreme Court reinstated the first-instance judgment. 145.  Finally, a bank statement dated 14 April 2004 indicates that the amount standing to Mr Mrkonjić's credit on the savings account on that date amounted, with accrued interest, to CHF 28,562.14.
(c)  The “Agreement for the Assignment of a Claim” 146.  On 29 April 2004 Mr Mrkonjić informed the Court that two days earlier he had withdrawn Mr Žugić's authority to represent him. 147.  In addition, he sent a copy of an “Agreement for the Assignment of a Claim” under which he had assigned to Mr Žugić his outstanding claim against the Zagreb Main Branch, namely CHF 28,562.14, with interest and the costs of the proceedings. In return, Mr Žugić had undertaken to pay 70% cent of that amount to the applicant by a certain date. Mr Mrkonjić's reason for withdrawing Mr Žugić's authority and cancelling this agreement was that the latter had failed to pay him the money due by the agreed date. 148.  On 20 August 2004 the Court requested Mr Žugić's comments on the information received from Mr Mrkonjić. 149.  On 8 September 2004 Mr Žugić replied that that he believed that he still had instructions to represent Mr Mrkonjić since the latter had not withdrawn his authority to act. He added that the agreement had not become effective since it had been rescinded by mutual consent. 150.  On 6 December 2004 Mr Mrkonjić appointed Mr Nogolica as his representative in the proceedings before the Court. 151.  On 18 March 2005 Mr Mrkonjić informed the Court that he had reinstated Mr Žugić as his representative.
(d)  Enforcement proceedings in Croatia 152.  In 2003 forty-two individuals, including Mr Mrkonjić, lodged requests for the seizure and sale of real estate owned by the Ljubljana Bank. Mr Mrkonjić's execution request was joined to the enforcement proceedings already pending in the Osijek Municipal Court. In the course of those proceedings, the Zagreb Main Branch's assets were liquidated on 30 March 2004 (see paragraph 124 above). 153.  On 20 July 2004 the Osijek Municipal Court gave a decision dividing up the proceeds of the sale. Mr Mrkonjić was awarded HRK 180,515.72 (EUR 24,728) for the main debt and the costs, to be paid into Mr Žugić's account. He was also awarded costs for the enforcement proceedings, but lodged an appeal against that decision in respect of the court fees (see paragraph 128 above). 154.  On 4 November 2004 the Ljubljana Bank representative informed Mr Mrkonjić that the monies had been deposited with the Osijek Municipal Court but the execution proceedings were still pending. 155.  On 8 April 2005 the Osijek Municipal Court issued a new decision on the division of the proceeds of sale. Mr Mrkonjić, represented by Mr Žugić, lodged an appeal against that decision on the ground that he was entitled to a higher award of costs. On 7 July 2005 the Osijek County Court dismissed the appeal. The decision of 8 April 2005 thus became final. 156.  The relevant parts of that decision read:
“The Osijek Municipal Court ... decided: ...
II. The costs of the enforcement proceedings shall be paid out of the amount obtained by the sale as follows:
  ... 9. Marjan Mrkonjić (I-Ovr-125/01), represented by the attorney Milivoje Žugić from Zagreb, the amount of HRK 25,374.22 [EUR 3,476] payable into the attorney Milivoje Žugić's giro account ... with the Economic Bank (Privredna banka d.d. Zagreb); the remainder of the judgment creditor's claim is disallowed.
...
III. The following claims shall be settled from the proceeds of sale:
... 9. Marjan Mrkonjić from Basel – the claim referred to in writ of execution no. I-Ovr-125/01 for the part relating to court fees in the amount of HRK 10,132.66 [EUR 1,388], payable to the attorney Milivoje Žugić from Zagreb's giro account ... with the Economic Bank, and the main debt in the amount of HRK 170,383.06 [EUR 23,340], which together total HRK 180,515.72 [EUR 24,728].
...” 157.  On 20 July 2005 Mr Mrkonjić received payment in full of his foreign-currency deposits, including the costs he had been awarded. 158.  Mrs Golubović, who was retired when she lodged her application with the Court, held a foreign-currency savings account at the Zagreb Main Branch as the heir of the original account-holder, the late Mr Ostoje Mejić, by virtue of a decision of the Karlovac Court of First Instance of 20 February 1998. That decision is final and enforceable. 159.  On 6 October 1994 the amounts in Mr Mejić's first savings book were recorded as: DEM 31,065.59, CHF 4,468.50 and 2,897.60 Austrian schillings (ATS). The amounts recorded in Mr Mejić's second savings book at 31 December 1993 were: DEM 5,307.54, USD 13,074.44, CHF 904.94, ATS 6,480.51 and 167,146 Italian lire (ITL). According to the applicant, those sums had been paid in between 1986 and 1990. 160.  On 29 May 2001 the Zagreb Main Branch issued a savings book in the applicant's name, further to the Karlovac Court of First Instance's decision of 20 February 1998. The deposits, including accrued interest, then came to DEM 39,085.45, USD 14,092.89, CHF 5,627.59, ATS 10,077.41 and ITL 193,495.
(b)  Other information submitted by the applicant 161.  Mrs Golubović maintained that the Ljubljana Bank had advised the Croatian savings-account holders in 1992 to limit their withdrawals to DEM 500. 162.  On 3 November 1998 a bank official at the Zagreb Main Branch informed her that all hard-currency accounts had been frozen and that no payments could be made. He confirmed that the Croatian courts had jurisdiction to hear claims but said that judgments were not being enforced owing to the Croatian branch's financial difficulties. The Slovenian and Croatian Governments were seeking a solution to the problem.
(c)  Proceedings in Croatia 163.  According to the respondent Government, Mrs Golubović's heir, Mr Steinfl, brought an action on 6 February 2007 against “the Ljubljana Bank, Zagreb Main Branch”, requesting payment of the outstanding deposits and interest as of 28 October 2005. As far as the Court is aware, the proceedings are currently pending before the Zagreb Municipal Court.