INTERNATIONAL DONORS REACH AGREEMENT WITH GOC

UNCLAS SECTION 01 OF 02 ZAGREB 000517 SIPDIS STATE FOR EUR/ACE, EUR/SCE, INL/AAG STATE PASS TO USAID, E&E/ADAA FOR PAULA FEENEY AND TO E&E/ECA FOR ANNE CONVERY DEPT OF JUSTICE FOR ICITAP/OPDAT E.O. 12958: N/A TAGS: PGOV EAID PHUM KCOR KJUS EAID PHUM KCOR KJUS HR HRPGOV IBRD EVN SUBJECT: INTERNATIONAL DONORS REACH AGREEMENT WITH GOC ON COURT REFORM UNCLASSIFIED PAGE 02 ZAGREB 00517 01 OF 02 101514Z REF: ZAGREB 465 ¶1. SUMMARY: INTERNATIONAL COMMUNITY DONORS AND THE GOC HAVE REACHED AGREEMENT ON A STANDARDIZED COURT AND CASE MANAGEMENT SOFTWARE PLATFORM THAT WILL BE IMPLEMENTED IN COURTS COUNTRY-WIDE. THIS NEW SYSTEM WILL IMPROVE MUCH- NEEDED JUDICIAL EFFICIENCY AND SIGNIFICANTLY REDUCE GOC COSTS ASSOCIATED WITH THE PREVIOUSLY SEPARATE DONOR INITIATIVES. THE AGREEMENT ALSO DEMONSTRATES THE HIGH DEGREE OF COORDINATION AMONG THE INTERNATIONAL COMMUNITY DONORS IN CROATIA. UNDER THE AGREEMENT, USAID WILL MERGE THE DESIGN WORK ALREADY COMPLETED UNDER TWO SEPARATE PROJECTS INTO A UNIFIED SYSTEM. SUBSEQUENTLY, THE WORLD BANK AND THE EU WILL ROLL OUT THE NEW TECHNOLOGY. END SUMMARY ¶2. THE NOTORIOUSLY INEFFICIENT CROATIAN JUSTICE SYSTEM IS ONE OF THE MAJOR DISINCENTIVES TO INVESTMENT, AND LAGGING REFORM IN THE SECTOR IS SEEN AS A SERIOUS ROADBLOCK TOWARDS EVENTUAL EU ACCESSION. SEVERAL DONOR PROGRAMS ARE WORKING ON VARIOUS ASPECTS OF THE PROBLEM WITH VARYING DEGREES OF SUCCESS. A MINISTRY OF JUSTICE IN DISARRAY AND WITH LITTLE COMMITMENT TO REFORM TAKES NO LEADERSHIP ROLE IN THE REFORM PROCESS, AND IN MANY CASES SEEMS TO BE WORKING AGAINST IT. ¶3. MULTI-YEAR CASE BACKLOGS ARE COMMON IN COURTS THROUGHOUT THE COUNTRY, AND ESPECIALLY IN THE LARGE URBAN COURTS OF ZAGREB, SPLIT, AND RIJEKA. THE PROBLEM IS BOTH LACK OF AUTOMATION (RECORDS OF CASE FILINGS ARE KEPT IN MULTIPLE LARGE HANDWRITTEN REGISTRY BOOKS),AND UNCLASSIFIED PAGE 03 ZAGREB 00517 01 OF 02 101514Z PROCEDURAL RULES THAT ALLOW FOR ENDLESS DELAYS BY THE PARTIES. THE GOAL OF A USAID PROGRAM BEGUN IN 2001 WAS TO DESIGN AND IMPLEMENT A NEW, MODERN COURT AND CASE MANAGEMENT SOFTWARE SYSTEM IN THE MUNICIPAL COURTS OF ZAGREB, THE LARGEST GENERAL JURISDICTION COURT SYSTEM IN EUROPE. THE PROJECT ALSO INCLUDED THE PROCUREMENT OF NEW HARDWARE AS WELL AS RELATED TRAINING FOR JUDGES AND COURT PERSONNEL. ¶4. SEVERAL MONTHS LATER, A PARALLEL USAID PROJECT WAS BEGUN TO DESIGN AND IMPLEMENT A NEW SOFTWARE SYSTEM IN THE COMMERCIAL COURTS ACROSS THE COUNTRY. THE USAID PROJECT IN THE COMMERCIAL COURTS WAS DESIGNED TO WORK IN CLOSE COLLABORATION WITH A WORLD BANK PROJECT FOCUSING ON REFORM OF THE BANKRUPTCY PROCESS IN CROATIA. THE AGREEMENT WAS THAT USAID WOULD FORM AND LEAD A WORKING GROUP OF COMMERCIAL COURT JUDGES TO PERFORM THE NECESSARY STUDY OF ALL THE PROCEDURAL RULES OF THE COURTS IN ORDER TO DESIGN THE SOFTWARE. ONCE THE SOFTWARE SPECIFICATIONS WERE COMPLETED, THE $5 MILLION WORLD BANK PROJECT WOULD THEN PAY FOR THE DEVELOPMENT OF THE SOFTWARE AS WELL AS NEW IT HARDWARE FOR THE MAJORITY OF THE COMMERCIAL COURTS ACROSS CROATIA. ¶5. AT THE TIME THESE DONOR ASSISTANCE PROGRAMS BEGAN, CROATIAN LEGAL EXPERTS AND THE MINISTRY OF JUSTICE WERE ADAMANT THAT THE PROCEDURAL RULES UNDER WHICH THE MUNICIPAL AND COMMERCIAL COURTS OPERATED WERE SO DIFFERENT THAT IT WOULD BE IMPOSSIBLE TO HAVE ONE COMMON COURT AND CASE MANAGEMENT SYSTEM. BUT AS THE USAID AND WORLD BANK ADVISORS LED WORKING GROUPS OF MUNICIPAL AND UNCLASSIFIED PAGE 04 ZAGREB 00517 01 OF 02 101514Z COMMERCIAL COURT JUDGES IN THE ANALYSIS OF THE RULES AND PROCEDURES OF THE COURTS, IT BECAME INCREASINGLY CLEAR THAT THERE WAS MORE COMMONALITY THAN DIFFERENCES IN THEIR OPERATIONS. ALTHOUGH THE COST AND EFFICIENCY ADVANTAGES OF ONE COMMON COURT AND CASE MANAGEMENT SYSTEM FOR VIRTUALLY ALL THE COURTS IN CROATIA WERE CLEAR, AND FEASIBILITY OF IMPLEMENTING SUCH A SYSTEM WAS BECOMING MORE OBVIOUS, THE MINISTRY OF JUSTICE CONTINUED TO INSIST ON SEPARATE SYSTEMS. ¶6. A RECENT VISIT BY THE WORLD BANK TEAM MANAGING THE BANKRUPTCY PROJECT TRIGGERED THE FORMATION OF A UNITED DONOR POSITION ON THE ISSUE. THE GROUP'S HAND WAS STRENGTHENED BY THE EU'S INTEREST IN INVESTING $7.5 MILLION IN CARDS FUNDING IN COURT REFORM. THE EU HAD BEEN TRYING WITH LITTLE SUCCESS TO ENGAGE THE MINISTRY IN DEVELOPING CONCRETE PLANS FOR THE FUNDS AND, WHEN APPROACHED, EU/CARDS STAFF WAS EAGER TO ADD THEIR LEVERAGE TO THE USAID AND WORLD BANK EFFORTS. ¶7. THE DONORS THEN PRESENTED THE MINISTRY OF JUSTICE UNCLASSIFIED UNCLASSIFIED PTQ8308 PAGE 01 ZAGREB 00517 02 OF 02 101514Z ACTION AID-00 INFO LOG-00 NP-00 AF-00 CIAE-00 INL-00 DODE-00 WHA-00 SRPP-00 DS-00 EAP-00 EUR-00 UTED-00 VC-00 TEDE-00 INR-00 IO-00 LAB-01 L-00 VCE-00 M-00 NEA-00 NSAE-00 PA-00 PER-00 IRM-00 TEST-00 SA-00 DSCC-00 PRM-00 DRL-01 NFAT-00 SAS-00 SWCI-00 /002W -------------- 41D475 101515Z /38 R 101502Z MAR 03 FM AMEMBASSY ZAGREB TO SECSTATE WASHDC 9640 AMEMBASSY BELGRADE AMEMBASSY LJUBLJANA AMEMBASSY SARAJEVO USEU BRUSSELS USMISSION USOSCE DEPT OF JUSTICE WASHDC UNCLAS SECTION 02 OF 02 ZAGREB 000517 SIPDIS STATE FOR EUR/ACE, EUR/SCE, INL/AAG STATE PASS TO USAID, E&E/ADAA FOR PAULA FEENEY AND TO E&E/ECA FOR ANNE CONVERY DEPT OF JUSTICE FOR ICITAP/OPDAT E.O. 12958: N/A TAGS: PGOV EAID PHUM KCOR KJUS EAID PHUM KCOR KJUS HR HRPGOV IBRD EVN SUBJECT: INTERNATIONAL DONORS REACH AGREEMENT WITH GOC ON COURT REFORM UNCLASSIFIED PAGE 02 ZAGREB 00517 02 OF 02 101514Z WITH A UNITED POSITION. ALL OF THE PREPARATORY WORK HAD BEEN COMPLETED FOR THE DEVELOPMENT OF TWO COURT AND CASE MANAGEMENT SOFTWARE SYSTEMS, BUT BASED ON THAT WORK IT WAS NOW CLEAR THAT THE TWO SYSTEMS HAD MUCH COMMONALITY. THE DONORS STRONGLY RECOMMENDED THAT THE SOFTWARE BE WRITTEN SO THAT THE BASIC SYSTEM COULD BE USED IN ALL COURTS, AND ADDITIONAL MODULES BE WRITTEN TO ACCOMMODATE THOSE AREAS OF COURT PROCEDURES (E.G., BANKRUPTCY PROCEEDINGS) WHERE PROCESSES DIFFERED. THE TWO SETS OF FUNCTIONAL SPECIFICATIONS WRITTEN BY THE USAID CONTRACTORS COULD BE RELATIVELY QUICKLY MERGED, THEIR AREAS OF COMMONALITY AND DIFFERENCES DEFINED, AND A TENDER THEN PREPARED FOR SOFTWARE DEVELOPMENT. THE EU SWEETENED THE OFFER WITH THE COMMITMENT TO PUT THEIR RESOURCES TOWARDS PAYING FOR SIGNIFICANT ADDITIONAL HARDWARE TO ROLL THE SYSTEM OUT COUNTRY WIDE. FACED WITH THE UNITED DONORS AND THE COMPELLING LOGIC OF THE PROPOSAL, THE MOJ AGREED. ¶8. THE DONORS AND THE MINISTRY ARE IN DISCUSSIONS OVER THE FINAL DETAILS OF THE AGREEMENT, BUT USAID HAS COMMITTED TO LEAD THE PROCESS OF MERGING THE TWO SETS OF SOFTWARE FUNCTIONAL SPECIFICATIONS. THIS WILL TAKE SEVERAL MONTHS, AT WHICH POINT USAID WILL HAND OFF THE FINAL PRODUCT TO THE WORLD BANK TO TENDER FOR THE SOFTWARE. THE WORLD BANK AND THE EU HOPE TO BEGIN THEIR RESPECTIVE PROCUREMENT PROCESSES FOR LARGE QUANTITIES OF IT HARDWARE IN THE FOLLOWING MONTHS. ¶9. THE DECISION TO PROCEED WITH A UNIFIED SYSTEM IS A CLEAR WIN/WIN SITUATION. THE CROATIAN COURTS GET A UNCLASSIFIED PAGE 03 ZAGREB 00517 02 OF 02 101514Z SINGLE COURT AND CASE MANAGEMENT SYSTEM THAT WILL ALLOW COMMUNICATIONS AMONG ALL THE COURTS AND INVOLVE LOWER MAINTENANCE COSTS. THE MINISTRY OF JUSTICE AVOIDS PAYING FOR DEVELOPMENT OF THE MUNICIPAL COURT SOFTWARE SYSTEM (ESTIMATED COST $800,000) AND WILL USE WORLD BANK LOAN FUNDS TO DEVELOP THE UNIFIED SYSTEM. ¶10. IN THE PROCESS OF HAMMERING OUT THE DEAL, THE DONOR COMMUNITY HAS IMPROVED COORDINATION AND COMMUNICATIONS ON JUSTICE SECTOR REFORM, BOTH AMONG THE DONORS AND BETWEEN THE DONORS AND THE MINISTRY. AND FINALLY, TWO RELATIVELY NEW AND REFORM-MINDED ASSISTANT MINISTERS IN THE MINISTRY OF JUSTICE HAVE NOW BECOME MORE ENGAGED THE IMPLEMENTATION OF THESE PROJECTS. THERE IS STILL A LONG JOURNEY AHEAD ON THE ROAD TO THE REFORM OF THE CROATIAN JUSTICE SECTOR, BUT THIS AGREEMENT REPRESENTS A SIGNIFICANT STEP FORWARD ON THAT JOURNEY. ROSSIN UNCLASSIFIED >