MACEDONIA: 2008 REPORT ON INVESTMENT DISPUTES AND

UNCLAS SKOPJE 000312

SIPDIS

DEPARTMENT FOR EUR/SCE

E.O. 12958: N/A
TAGS: EINV KIDE OPIC PGOV MK
SUBJECT: MACEDONIA: 2008 REPORT ON INVESTMENT DISPUTES AND
EXPROPRIATION CLAIM

REF: A. SECSTATE 43784


B. 07 SKOPJE 502


1. Post is aware of one outstanding claim of a U.S. person
against the Government of Macedonia (GOM). This dispute
remains unchanged from last year's report (ref B).


2. a. Claimant A.

b. This dispute arose in April 2007, when the GOM decided to
end a concession previously granted to Claimant A's company
and sent the company a letter to that effect.

c. Claimant A is a U.S. citizen of Macedonian descent who
co-invested with his Macedonian citizen family member in a
bottled water company. Claimant A claims to own 50 percent
of the company, with an investment of approximately
$2,000,000. The company has a government-granted concession,
issued in 2000, to bottle and sell the underground water in
the area. The GOM in April, 2007 issued an official decision
to cancel the concessions of three companies, including
Claimant A's company, located in the "Rasce" area near
Skopje, the capital. Claimant A's company received a letter
in April 2007, signed by the Minister of Economy, notifying
the company of the GOM's decision. The letter provided no
explanation and did not discuss any compensation for the
company. Econoff met with GOM officials in April and June
2007 to discuss the case. The officials claimed that the
company's activities threatened Skopje's water supply. The
officials acknowledged that the GOM should offer
compensation, but could not provide any information on how
compensation would be provided. Subsequently, the company
owners filed a lawsuit in Macedonian court that claimed that
the GOM had not followed proper legal procedures in deciding
to cancel the concession. Post contacted the company on May
7, 2008 and was informed that there has been no decision or
further legal action on the company's law suit. The company
has continued its operations and has received no further
communication from the GOM.


3. Claimant A, Mr. Angelko Milosevski, is a U.S. citizen and
was a U.S. citizen at the time of the GOM decision. He
claims to be a 50 percent owner of the company "Rotiko."
NAVRATIL