BOSNIA: DODIK CHALLENGES STATE COMPETENCIES

C O N F I D E N T I A L SECTION 01 OF 02 SARAJEVO 001058 SIPDIS SIPDIS E.O. 12958: DECL: 05/11/2017 TAGS: BK PGOV PREL SUBJECT: BOSNIA: DODIK CHALLENGES STATE COMPETENCIES REF: SARAJEVO 925 Classified By: Ambassador Douglas L. McElhaney. Reasons 1.4 (b),(d). Summary -------------- ¶1. (C) On May 4, Republika Srpska (RS) PM Milorad Dodik publicly announced his intention to reverse past transfers of RS competencies to the Bosnian state. Dodik's announcement was followed closely by a lawsuit, filed by SNSD parliamentarian Milorad Zivkovic, challenging the constitutionality of the state Law on Procurement. Zivkovic acknowledged his lawsuit is part of Dodik's broader initiative and the Law on Procurement, due to its widespread unpopularity in both the Federation and the RS, was chosen as a test case for the strategy. Zivkovic added that the RSNA has identified 48 other transfers of competencies to be challenged in court. Zivkovic asserted that nationalist rhetoric from Bosniak Haris Silajdzic, particularly his proposal to remove Srebrenica from the jurisdiction of the RS, precipitated Dodik's approach. Dodik's motives are unclear. His private comments are reassuring and suggest his latest rhetorical salvo against the state has short-term political aims - increasing his leverage in Indirect Taxation Authority (ITA) negotiations, and countering Bosniak member of the Tri-Presidency Haris Silajdzic's anti-RS rhetoric. Something more significant and sinister could be at work as well. Regardless, Dodik's approach contributes to the political gridlock paralyzing Bosnia and threatens to still further complicate the reform process. End Summary. Dodik's Opening Salvo -------------- ¶2. (U) At his weekly press conference on May 4, Republika Srpska (RS) Premier Milorad Dodik announced his intention to begin the process of "abolishing prior RS government consent" to past transfers of competencies from the RS to the State. Dodik declined to be drawn out on specifics but asserted that his decision was motivated by the ineffective execution of the competencies by the state. Dodik's comments on the devolution of competencies followed a long statement on the urgency of returning to the April package of constitutional reforms. He stated that if the April package is abandoned, new negotiations must at a minimum recognize the RS as a "federal unit" within Bosnia with "clear legislative, executive and judiciary competencies." Lawsuit Filed -------------- �A;¶3. (C) On May 5, Ambassador discussed the press conference statements with Dodik. The Ambassador stressed that, as the USG has repeatedly told Haris Silajdzic, politicians who seek to reverse Bosnia's reform process are not acting in the interests of its citizens. Dodik asserted that his comments were directed primarily towards an OHR-imposed settlement of the Indirect Taxation Authority (ITA) dispute (reftel) and not intended to challenge the authority of the state. He also claimed that the cumbersome state-level Law on Procurement was hampering RS efforts to meet its commitments to Srebrenica. The Ambassador replied that the best way to address any deficiencies in the law through the legislative process rather than challenging the constitutionality of a law that his own party helped pass. ¶4. (C) On May 8, Milorad Zivkovic, SNSD Deputy Chairman in the State House of Representatives, announced he had filed a suit with the Constitutional Court challenging the legality of the state Law on Public Procurement. The law, which entered into force in November, 2004 and was one of the EU conditions for a Stabilization and Association Agreement (SAA) with Bosnia, was designed to institute uniform contracting procedures for the Federation, the RS and Brcko District under a state level Procurement Agency. The law has been unpopular with both the RS and Federation governments due to its introduction of a tender system for official contracting. ¶5. (C) Zivkovic told us that the lawsuit was part of PM Dodik's strategy to challenge the constitutionality of all past competency transfers. He said the RS National Assembly had convened a working group to identify competencies whose transfer to the State should be challenged. Zivkovic stated that the group had identified 48 such competencies and would SARAJEVO 00001058 002 OF 002 pursue a similar legal strategy filing lawsuits challenging each in turn. The original transfers had been signs of goodwill on the part of the RS government which had been met with obstructionism and hostility by Federation-based political leaders. Zivkovic said that with the recent rise in nationalist politics by Bosniak leaders, with Haris Silajdzic openly calling for the abolition of the RS, it was time for the RS to reconsider its acquiescence to the transfers. ¶6. (C) Although RS officials have not publicly discussed other competencies that may face legal challenges, RS Finance Minister Aleksandar Dzombic has repeatedly made reference to repealing ITA-related laws specifically legislation creating the joint account in favor of returning to a three-account system. RS Interior Minister Stanislav Cadjo separately suggested to OHR that intelligence reform and the creation of SIPA could fall under the RSNA review of competencies. Comment -------------- ¶7. (C) Dodik's motives are unclear. His comments to the Ambassador suggest he is likely signaling his determination to protect the legal integrity of the RS in the face of Haris Silajdzic's repeated calls for the elimination of the RS. Nonetheless, the current lawsuit and those that may follow could represent a threat to the existence and functioning of hard-won state-level competencies such as the ITA. We have made clear to him that his rhetoric and threatened actions are counterproductive and that efforts to improve the functionality of the state are not incompatible with efficient government in the RS. Efforts to undercut successful state-level reforms are as unacceptable as Haris Silajdzic's efforts to undermine Dayton structures. End Comment. MCELHANEY