CUSTOMS DISPUTE CAUSES NEW MISUNDERSTANDINGS IN BOSNIA

SARAJEVO, Dec 16 (Hina) - The agreement on duty-free trade signed between Croatia, the Republic of Bosnia-Herzegovina and the Federation of Bosnia-Herzegovina in 1996, is invalid, the Office of the High Representative (OHR) for implementation of the Dayton agreement said on Wednesday, asking that the agreement be cancelled immediately. On December 9, High Representative Carlos Westendorp requested the prime ministers and the finance ministers of the two Bosnian entities to immediately start implementing the Law on BH Customs Tariffs, which took effect in March 1998, OHR spokeswoman in Sarajevo Andrea Stiglmayer told Hina. According to the agreement of 1996, signed in Split, trade between Croatia and the BH Federation is subject to a 1 per cent customs tariff. According to the Law on BH Customs Tariffs of March this year, the average customs rate is 10 per cent for all imported goods. The OHR considers the Split agreement invalid because international agreements must be closed on the state level, Stiglmayer said. Also, customs tariffs must be the same for the whole territory of Bosnia-Herzegovina, she added. BH Assistant Foreign Trade Minister Nikola Grabovac told Hina that the unilateral cancellation of the agreement on duty-free trade is not possible. "International agreements are older that laws adopted within a state. Besides, the Split agreement envisages a one-year cancellation period, on condition that one of the parliaments decides to cancel it", Grabovac said. The OHR letter of December 9, which Hina's reporter had the opportunity to see, says that the existing preferential customs treatment not only violates the BH customs policy but also causes a huge loss in the entities' budgets. Westendorp also refers to the conclusion of the Peace Implementation Council in Luxembourg regulating that all illegal forms of customs treatment must be stopped by July 15. On December 11, two days after he received Westendorp's letter, Federation Prime Minister Edhem Bicakcic ordered the BH Federation Customs Administration to issue an instruction on cancelling the regime of duty-free trade with Croatia as of December 15. Such an instruction was issued by the Federation Customs Administration deputy manager Fuad Kasumovic on December 15 however, without the knowledge of his superior, manager Stipo Vujovic. Vujovic cancelled the instruction and ordered that the implementation of the previously applied customs regulations continue. "The first article of the law on customs tariffs specifies that the law will be applied in all cases except when Bosnia-Herzegovina already has appropriate agreements with other states", Vujevic told Hina. The confusion in the field was enhanced by the fact that Bosniak- controlled customs offices, such as the one in Izacic, outside Bihac (western BH), are abiding by the instruction released by Kasumovic, while those supervised by Croats follow Vujovic's instructions. Westendorp's request, which applies to both BH entities, is however not being implemented in Republika Srpska. The Bosnian Serb entity also allows duty-free import of goods from the Federal Republic of Yugoslavia. Prime Minister Milorad Dodik has so far only given a verbal promise to regulate the issue. "It is only logical for Croatia now to respond with counter- measures and I don't know where we are going to export our goods with all these customs tariffs to be paid", Assistant Foreign Trade Minister Grabovac said commenting on the situation. Croatian Economy Minister Nenad Porges today said he believed Croatia should not "counter" the Bosnian Federation's move given that Croatia's export greatly exceeds Bosnia's. The Croatian government would have to "seriously consider how to accelerate regulating the entirety of relations, especially in light of the recently signed special relations agreement (between Croatia and the Federation) in which economic aspects have a dominant role," said Porges. (hina) jn rml