The Grand Chamber of the European Court of Human Rights (ECHR) in Strasbourg will decide on Slovenia’s lawsuit against Croatia in the dispute concerning the Croatian clients’ savings deposits in the Zagreb branch of the now defunct Slovenian bank Ljubljanska Banka, Slovenian media reported on Wednesday.

In autumn 2016, Slovenia lodged an application with the ECHR against Croatia, alleging systematic and arbitrary interference by the Croatian government in proceedings brought by Ljubljanska Banka in Croatian courts, and demanding €360 million in damages.

The decision on the application was relinquished to the Grand Chamber, which means it will be final, the Court said in the press release.

When Slovenia lodged the application in September 2016, its then Prime Minister Miro Cerar said Slovenia had the legitimate right to demand from the ECHR a decision which would enable Ljubljanska Banka to collect its receivables from Croatian companies given that, under another ECHR decision, the bank was reimbursing its Yugoslav-era clients in Croatia and Bosnia and Herzegovina.

The ECHR had ruled in 2014 that Slovenia must reimburse the clients of the defunct Ljubljanska Banka. The bank had not repaid the savings of some 300,000 clients across former Yugoslavia after its branches have closed in 1991, with its total debt to former clients amounting to some €385 million.

Cerar said that Croatian authorities had since 1991 been preventing the bank from collecting the receivables from Croatian companies and that they had interfered in the court proceedings brought by the bank.

Last spring, before the end of its term, the Cerar cabinet announced another similar suit against Croatia before the European Court of Justice in Luxembourg, but it has not been lodged yet.

The announcement was made after a number of decisions by Croatian courts in favour of Croatia’s Privredna Banka Zagreb and Zagrebacka Banka in suits they had brought against Ljubljanska Banka and its successor Nova Ljubljanska Banka over the repayment of their debts, which were transferred to the two Croatian banks and repaid from public funds.

In its dispute with Croatia over Ljubljanska Banka’s transferred Yugoslav-era foreign currency savings, Slovenia claims the debt belongs to the old, liquidated, Ljubljanska Banka, and its successor, the present-day state-owned Nova Ljubljanska Banka (NLB), is not obligated to take on the debt.

The Slovenian government insists that by allowing proceedings to continue at its courts, Croatia is acting against the bilaterally agreed solution to the problem in the 2013 Mokrice Memorandum, signed by signed before Croatia’s accession to the EU by then Prime Ministers, Zoran Milanovic of Croatia, and Janez Jansa of Slovenia.

Slovenia claims it was agreed in Mokrice that the proceedings against Ljubljanska Banka in Croatia would be suspended and that a comprehensive solution would be sought regarding inherited debts and receivables, but that Croatia has not complied.

Croatia, however, claims that when the memorandum was signed in 2013, it was agreed the proceedings would be suspended for a maximum of two years, giving time for the comprehensive solution to be found. Given that no solution was found, the proceedings were resumed.

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