Court decided: Ministry of Transport and Communications of the RS is illegally hiding the contract on the construction of the Banja Luka – Prijedor highway

Banja luka, October 19, 2022 Transparency International in Bosnia and Herzegovina (TI BIH) won a court case against the Ministry of Transport and Communications of the Republic of Srpska, which illegally hid the concession contract for the construction of Banja Luka – Prijedor highway. The District Court in Banja Luka issued a verdict ordering the Ministry to deliver to TI BIH the contract concluded in 2018 with the Chinese company Shandong Hi-Speed International (SDHS).

According to the information published by the portal Capital.bathe concession contract, which should last for 30 years, defines that the Chinese company will invest about 297 million euros in the construction of the highway, and should earn about 975 million euros through toll collection and the missing funds that will be settled from the budget of the Republic of Srpska. Due to the suspicion that this contract was concluded under harmful conditions for the Republic of Srpska, TI BiH asked the Ministry for a copy of the contract, but this request was rejected with the explanation that the publication of the contract could harm the commercial interests of the Chinese company.

As the government in this case clearly put the interest of the private investor above the interest of public, TI BIH filed a lawsuit with the District Court in Banja Luka, which accepted the lawsuit and ordered the Ministry to re-conduct the procedure with a very clear instruction that its task is to serve the interests of the citizens, and not to worry about the trade secrets or any other financial combinations of the contracting party which is given to exploit and collect public revenues for 30 years.

The judgment also states that the Ministry has replaced the role of a public body that disposes of public money and acts to protect the public interest, with the role of a protector of a business partner.

“It is undoubtedly in the public interest to have complete insight and knowledge on whether favorable conditions have been agreed for the Republic of Srpska and its citizens, whether the conditions are in accordance with the public interest, and to compare whether better conditions could have been agreed; on the contrary, the interest of the public is not concerned with the protection of the legal entity business with whom the contract was concluded, i.e. whether its business will be profitable in a period of three decades or not” the judgment states. The court accepted the argumentation of TI BiH stating that the Ministry did not specify what damage would result from publishing the requested information.

When the Ministry refused TI BIH’s request to publish the contract, it stated that it contains confidential information about the methods of collecting toll revenue, formulas for calculating cash flows, and the concessionaire’s financial plan. They also state that the economic value of this data lies precisely in the fact that it is not widely known to the public.

The court states that the decision has nothing to do with the law, but is based on the defendant’s need to put himself in the service of protecting the concessionaire and reminds that one of the basic principles of the Law on Concessions is transparency, market competition, equal treatment for everyone. The contract with the company SDHS was not concluded through a public invitation, but through a negotiation procedure, which the Government of the RS has often used so far, bypassing public bidding, and such contracts often caused damage to public finances.

TI BiH reminds that a similar practice has been observed with other authorities when concluding contracts with Chinese companies, where they offered us almost the same reasons for not submitting the contract, and this court decision confirms the warnings of TI BiH that the commercial interests of Chinese companies should not be placed above the interests of the citizens of BiH .

Press rls_19.10.22_