KOSOVO: KOSOVO PROPERTY AGENCY BOARD MEETING

UNCLAS PRISTINA 000863 SIPDIS SIPDIS DEPT FOR DRL, INL, AND EUR/SCE, NSC FOR BRAUN, USUN FOR DREW SCHUFLETOWSKI, USOSCE FOR STEVE STEGER E.O. 12958: N/A TAGS: PGOV KJUS KCRM EAID KDEM UNMIK YI SUBJECT: KOSOVO: KOSOVO PROPERTY AGENCY BOARD MEETING HIGHLIGHTS RENTAL SCHEME, NEW DRAFT LAW, FUNDING WOES SENSITIVE BUT UNCLASSIFIED -- PLEASE HANDLE ACCORDINGLY. ¶1. (SBU) SUMMARY: At an October 10 meeting of the five-member supervisory board of the Kosovo Property Agency (KPA),which includes USOP, KPA head Knut Rosandhaug confirmed that the rental property scheme by which illegal Albanian occupants pay rent to Serb owners had begun on October 2. Rosandhaug also shared a draft law, soon to be promulgated by UNMIK, that would provide for resolution of claims by means of a property claims commission, rather than through the Kosovo court system. PDSRSG Steve Schook, who chaired the meeting, said that UNMIK would call a donors conference to fund KPA operations, which Rosandhaug later estimated at around 6 million euros over two years. The launch of the rental scheme, even if not yet on a massive scale, is good news and is an important step toward fulfillment of one of the most important of the Contact Group's 13 priority standards for Kosovo. END SUMMARY. Background ¶2. (U) On October 10 the Supervisory Board of the KPA met for the second time since the KPA's establishment in July ¶2006. The KPA took over responsibility from UNMIK's Housing and Property Directorate and is mandated by UNMIK to resolve claims relating to private immovable property, including agricultural and commercial property, arising out of the 1999 conflict. The KPA currently has some 5,400 properties under its administration and has worked toward institututing a rental scheme to provide an income source to displaced owners, mostly Kosovo Serbs who now reside in Serbia, Montenegro or Serb-majority municipalities in Kosovo. Implementation of the rental scheme is one of the Contact Group's 13 priority standards for Kosovo. The Supervisory Board consists of five members: PDSRSG Steve Schook (chair); Ardian Gjini, Minister of Environment and Spatial Planning; P/E Chief, as USOP representative; David Blunt, Head of the UK Liaison Office; and Milorad Todorovic, former deputy CCK leader, representing Kosovo Serb interests. Rental Property Scheme Underway ¶3. (SBU) KPA head Knut Rosandhaug told the KPA's 5-member supervisory board that the rental property scheme had begun on October 2. Although the initial number of properties involved thus far is small (in the tens),Rosandhaug said this figure was growing by about 5-6 properties per day, and predicted this would increase even more as the KPA mounts a media campaign, including in Serbia and Montenegro, on how owners can file claims. (Rosandhaug later told P/E Chief that of the 5,400 properties under KPA administration, some 1,800 involved owners who could not be identified or who did not want to participate in the rental scheme. He said he favored collecting rents from these properties, but that the PISG had not yet agreed to this.) New Draft Law to Speed Up Adjudicating Claims ¶4. (SBU) Rosandhaug shared with the board a draft law, soon to be promulgated by UNMIK, that would provide for resolving claims by means of a property claims commission composed of two international members and one Kosovar member. In this way, he went on, claims could be processed faster and more effectively than relying solely on domestic courts, as is the case at present. Domestic courts could play an enforcement role, he noted, if the two sides in a dispute came to agreement on their own. Rosandhaug added that after six months, the draft law provides for the replacement of one of the international claims commission members by a Kosovar member, if the SRSG deems it appropriate, and stressed that the KPA is a "joint venture" between the PISG and UNMIK, with strong buy-in from local institutions. KPA's Funding Problems ¶5. (SBU) PDSRSG Steve Schook said he feared that KPA operations would come to a halt if donor funding could not be secured soon. He faulted the KPA's current legal framework for remaining in force only until the end of February 2007, saying this had caused donors to shy away from committing themselves, and asked UNMIK legal adviser Borg-Olivier to ensure the draft law was more open-ended. Everyone present agreed with this reasoning, although Minister Gjini asked if the timeframe could be given a specific limit (two years, for example) so as to encourage greater involvement by local institutions. Schook took this on board and said he would soon make a presentation to key donors, including USAID, the European Agency for Reconstruction, and the UK's DFID, on KPA's activities and needs. After the meeting, Rosandhaug told P/E Chief that KPA would need around six million euros over two years for its operations. ¶6. (SBU) COMMENT: The KPA has a hard slog ahead of it, but getting the rental scheme off the ground, even if not yet in a massive way, is a start. It represents a serious attempt to fulfill a priority standard set by the Contact Group. The KPA will need to secure funding, including for a media campaign, to get the word out on how to file claims and keep the momentum going. END COMMENT. ¶7. (SBU) U.S. Office Pristina clears this cable in its entirety for release to U.N. Special Envoy Martti Ahtisaari. KAIDANOW