Local authorities of the city of Varazdin decided to withdraw the city's enforcement order which blocked the bank account of the local Varteks clothing manufacturer, the city said on Tuesday, so that the company can pay out wages.

On 11 August, the authorities of this northern Croatian city seized Varteks’ account over a 1.3 million kuna (€173,000) debt, after company CEO, Tomislav Babic, had handed in his resignation. However, mayor Neven Bosilj (SDP) later decided to withdraw the decision ordering the enforced collection of Varteks’s debt.

According to Bosilj’s explanation, some of the receivables have been paid back to the city, and the authorities have also taken into consideration the whole social situation and decided to give up on the enforced collection of claims and enable the company to continue doing business.

Once a major clothing company, Varteks today employs 850 workers.

The head of the company’s workers’ council and a member of the Varteks supervisory board, Bozica Cicek-Mutavdzic, who recently informed the public about the difficult situation in the factory today thanked the mayor for the decision.

According to her, Varteks has been recording an increase in retail sales compared with 2019, the year before the coronavirus crisis, which also affected its business. She noted that production capacities are filled until the end of the year and that there is interest from international brands for cooperation.