DECREEON SALE OF CAPITAL AND PROPERTY BY PUBLIC AUCTION("Official Herald of the Republic of Serbia", Nos. 52/2005 and 91/2007) |
Article 1
The present Decree shall regulate the procedure and mode of sale by public auction of the following:
1) socially-owned and state-owned capital (hereinafter: capital) and or property;
2) allotments transferred to the Share Fund and/or portions to be sold by the Share Fund in conformity with law (hereinafter: quotas).
In a public auction the price and the buyer, with whom contract will be entered into, shall be determined.
Article 2
The terms used in the present Decree shall have the following meaning:
1) Agency for Privatization (hereinafter: Agency) is a legal entity which sells capital and/or property and promotes, initiates, conducts and controls the privatization procedure in conformity with law;
2) Share Fund is a legal entity to which shares and/or allotments are transferred in conformity with law for the purpose of sale;
3) Public auction (hereinafter: auction) is a method of privatization by public competition of participants in conformity with the determined terms of sale;
4) Auction Commission is a commission which conducts the sale of capital and property by the auction method (hereinafter: Commission);
5) Auctioneer is a person who technically carries out the auction procedure;
6) Deposit is a money amount, a first class bank guarantee acceptable by the Agency, and/or bonds on the ground of unpaid foreign currency savings of citizens issued to natural persons who are citizens of the Republic of Serbia, at their nominal value (hereinafter: bonds). The deposit shall be paid and/or lodged by an interested person for the purpose of ensuring participation in the auction, and/or biddings;
7) Contract of sale is a contract of sale of capital, and/or property and a contract of sale of allotment.
Article 3
The initial price at the first auction shall equal 20% of the upper limit of the range of capital, and/or property offered for sale, and confirmed by the Agency.
In the event of the simultaneous selling of the socially-owned capital of the subject of privatization and capital of other legal entities within this subject, the initial price of the socially-owned capital at the first auction shall be100% of the basic value of the capital.
Means of payment at the first bidding may be in cash, and/or bonds that become mature by the date of sale of capital or property, inclusive (hereinafter: mature bonds).
Should the first bidding fail, a second bidding shall begin immediately, with the same initial price, at which the difference between the sale price and the deposit at the first bidding shall be paid in bonds that are not mature by the date of sale of capital or property (hereinafter: immature bonds).
Should the first auction be declared as failed, a public call for a second auction shall be announced in a seven day time limit following the day of declaring the first auction as failed.
The deposit may be paid in cash, by depositing a first class bank guarantee, or in mature bonds. The deposit for the second bidding may be paid in immature bonds as well.
Article 4
The initial price at the second auction shall equal 20% of the lower limit of the range of value of capital and/or property offered for sale, and confirmed by the Agency. Means of payment at the first bidding may be in cash and/or mature bonds.
In the event of the simultaneous selling of the socially-owned capital of the subject of privatization and capital of other legal entities within this subject, the initial price of the socially-owned capital at the second auction shall be 50% of the basic value of the capital and/or 20% of the basic value of the capital at the third auction.
Should the first bidding fail, the second bidding shall begin immediately with the same initial price, where the difference between the sale price and the deposit for the first bidding is paid in immature bonds.
The deposit may be paid in cash, by depositing a first class bank guarantee or in mature bonds. The deposit for a second bidding may be paid in immature bonds as well.
Article 5
In the event of sale of allotments, the initial price at the first auction shall be the corrected book value according to latest financial report, increased by the amount of debt written off.
Should the first auction be declared as failed, the public call for a second auction shall be announced in a seven day time limit following the day of declaring the first auction as failed.
The initial price at the second auction shall equal 50% of the initial price at the first auction.
Should the second auction be declared as failed, the public call for a third auction shall be announced in a seven day time limit following the day of declaring the second auction as failed.
The initial price at the third auction shall equal 20% of the initial price at the first auction.
The means of payment at the auction shall be in cash within a five day time limit following the day of holding the auction.
The deposit for the auction may be paid in cash or by depositing a first class bank guarantee.
Article 6
An auction shall be declared as failed should even after the third call to auctioneers at the second bidding, none of the participants bids for the offered price.
In the event of sale of allotments, the auction shall be declared as failed should even after the third call to auctioneers at the auctions referred to in Article 5 of the present Decree none of the participants bids for the offered price.
Article 7
The decision on the sale of capital by auction shall be made by the Agency, which shall notify accordingly the entity to be privatized.
The decision on the sale of allotments by auction shall be made by the Agency, which shall notify accordingly, together with the order for the sale, the Share Fund and the subject to be privatized.
Article 8
The Agency shall organize the auction.
In the procedure or organizing the auction, the Agency shall:
1) determine the conditions of sale;
2) prepare the auction, including the determination of date and time of holding the auction and the announcement of public invitation;
3) establish the Commission;
4) nominate the auctioneer and assistant auctioneer;
5) control and approve the privatization program;
6) perform other tasks relevant to the conduct of auction.
In case of sale of allotments, the Agency shall organize the auction in cooperation with the Share Fund.
Article 9
The Agency shall announce the public invitation for the participation in an auction (hereinafter: public invitation) in the public media (press, television, internet) 30 days at the earliest prior to the date of holding the auction. In case of sale of allotments the public invitation shall be announced by the Agency and the Share Fund jointly.
Public invitation referred to in paragraph 1 of the present Article shall include:
1) business name of the entity to be privatized and the identification number of the entity to be privatized;
2) percentage amount of capital or description of property offered for sale, and/or percentage amount of the allotment offered for sale;
3) financial and other data relating to the entity to be privatized relevant for the participants in the auction (number of employees, products, etc.);
4) place and address of holding the auction;
5) date and time of holding the auction;
6) auction sale code;
7) deadline and mode of applying for participation in the auction;
8) date, time and place of registration of participants;
9) price, place and mode of obtaining the auction documentation;
10) amount and mode of payment of deposit for participating in the auction;
11) summary description of the auction procedure;
12) initial price for the auction;
13) means of payment;
14) date, time and place of visiting the subject to be privatized, should the public invitation to the auction relate to the sale of capital, and/or property;
15) other data relevant for conducting the auction.
If necessary, the Agency may change the date and time of holding the auction. A change of date and time of holding the auction shall mean the change of deadline for the buying-up of auction documentation and the deadline for applying for the participation in the auction.
In the case referred to in paragraph 3 of the present Article, the Agency shall announce the change of the public invitation.
Article 10
The entity to be privatized and the Agency shall determine the date and time of a visit to the entity to be privatized.
Interested persons may visit the entity to be privatized upon their signing of the contract on safe-keeping of confidential information.
Article 11
The Agency and the entity to be privatized shall provide to all interested persons under the same conditions the access to information relating to the auction.
Article 12
The sale by auction method shall be conducted by the Commission to be established by the Agency.
The Commission, in cooperation with the Agency shall provide necessary conditions for holding the auction.
The Commission shall have three members.
The Commission shall appoint the chairman from the ranks of its members.
The Commission shall be appointed for one or more auctions.
In the event of sale of an allotment, one member of the Commission shall be the representative of the Share Fund.
Article 13
The Commission shall perform the following tasks:
1) supervises and carries out the auction sale;
2) registers persons entitled to participate in the auction;
3) signs the minutes;
4) declares the auction failed;
5) performs other tasks as well, relevant for conducting the auction, in conformity with law.
The Commission shall take decisions by majority vote of Commission members.
Professional, consulting and administrative-technical tasks for the needs of the Commission shall be carried out by the Agency.
Article 14
An auctioneer shall perform the following tasks:
1) invites participants to present a bid to the offered price;
2) keeps order at the auction and pronounces measures in the case of disturbance of its course;
3) proclaims the buyer.
III APPLICATION FOR PARTICIPATION AND REGISTRATION OF PARTICIPANTS
Article 15
Auction documentation shall include:
1) privatization program;
2) contract of safe-keeping of confidential information;
3) draft contract of sale;
4) application for participating in the auction.
In the case of sale of an allotment, the auction documentation shall include the contract of sale draft, the application for participating in the auction, and the latest condition balance sheet and the operative statement.
The auction documentation shall be sold to natural persons and legal entities who express an interest to take part in the auction, at the price to be determined by the minister in charge of privatization affairs.
A confirmation of payment of the price referred to in paragraph 3 of the present Article for the auction documentation shall include the auction sale code, and may be handed over directly to the Agency, or at the place indicated in the public invitation, while it can also be sent by fax to the number indicated in the public invitation.
Upon the receipt of confirmation referred to in paragraph 4 of the present Article, the auction documentation shall be handed over or forwarded to the interested natural persons or legal entities within a three day time limit.
Article 16
The draft contract of sale of capital and/or property shall be made by the Agency.
The draft contract of sale of capital and/or property shall include the buyer's obligation to provide continuity of business operation of the entity to be privatized, the conditions of land use, means and terms of payment of the price.
Draft contract of sale of capital and/or property may include the buyer's obligation to invest funds into the entity to be privatized, to settle labour issues, and protect the environment.
Draft contract of sale of capital and/or property shall not include the sale price.
Participants in an auction shall sign the draft contract of sale prior to holding the auction.
By signing the draft contract of sale of capital and/or property, the participants in the auction shall commit themselves by the terms of the draft contract.
Draft contract of sale of capital and/or property containing the sale price and information relating to the auction participant who is declared the buyer in the auction, and which is signed by the authorised person of the Agency and by the buyer, shall become the contract of sale.
The sale price shall be the last price determined at the auction.
Article 17
Draft contract of sale of an allotment shall be made by the Share Fund.
The draft contract of sale of allotment shall include the terms relating to mutual rights and obligations of contracting parties.
The draft contract of sale of an allotment shall not include the sale price.
Participants in the auction shall sign the draft contract of sale of an allotment prior to the holding of the auction.
By signing the draft contract of sale of an allotment, the participants in the auction shall commit themselves by the terms of the draft contract.
The draft contract of sale of an allotment containing the sale price and information relating to the auction participant who is declared the buyer at the auction, and which is signed by a person authorised by the Share Fund and the buyer, shall become the contract of sale.
The sale price shall be the last price determined at the auction.
Article 18
Entitled to take part in an auction shall be domestic and foreign legal entities and natural persons.
The persons specified in paragraph 1 of the present Article may participate in an auction if they have:
1) purchased the auction documentation;
2) been registered as participants in the auction;
3) paid the deposit.
Article 19
Should a participant in the auction apply to buy capital and/or property of one or more entities to be privatized, as well as to buy an allotment, such participant may authorise a person to represent him at the bidding, to be responsible for the offer of the participant and the performance of all obligations towards the Commission.
Where several persons associate in order to buy capital and/or property of one entity to be privatized (a consortium), they shall be bound to authorise one member of the consortium to represent the consortium at the auction and be responsible for the offer of the participants and the performance of all obligations.
The authorization specified in paragraphs 1 and 2 of the present Article must be certified in court.
Article 20
The following persons shall not be entitled to take part in an auction:
1) natural persons and legal entities with financial obligations towards the entity whose capital and/or property is the subject of privatization;
2) members of the Commission;
3) next of kin of first inheritance level of the members of the Commission;
4) a legal entity owned by members of the Commission;
5) a legal entity owned by next of kin of first inheritance level of members of the Commission;
6) other persons in conformity with law and the present Decree.
Article 20a
The following persons shall not be entitled to take part in an auction, too:
1) natural person who has been convicted of criminal offences against life and body, criminal offences against property, criminal offences against economy, criminal offences against official duty, criminal offences against public health and criminal offences against public peace and order which are threatened with prison of five years or heavier punishment, or against whom the indictment, for these criminal offences, has been final;
2) business company in which the person, from the item 1) of this paragraph, is a control member or control shareholder, within the meaning of the law on regulation business companies.
4. Application to Participate in an Auction
Article 21
An application of a domestic natural person to participate in an auction shall include:
1) auction sale code and trade name of the entity to be privatised;
2) name and surname;
3) name and surname of one of the parents;
4) particulars relating to citizenship of the Republic of Serbia;
5) address, identification number and signature;
6) telephone and fax numbers;
7) account number for refunding the deposit;
7a) confirmation of the competent authority, which is not older than six months, that he has not been convicted for the criminal offences from the Article 20a item 1) of this Decree, and declaration that any indictment against him for these criminal offences has not become final;
8) declaration of a domestic natural person indicating that he is not member of a family of the person who has forfeited the status of buyer.
An application of a domestic legal entity to participate in an auction shall include:
1) auction sale code and trade name of the entity to be privatised;
2) trade name and identification number;
3) name and surname of director and his signature;
4) certified photocopy of the Court Register excerpt;
5) certified photocopy of authorization for representation at the auction issued by the competent body;
6) account number for refunding the deposit;
6a) confirmation of the competent authority, which is not older than six months, that the natural person who is a control member and/or control shareholder of that business company has not been convicted for the criminal offences from the Article 20a item 1) of this Decree, and declaration of that person that any indictment against him for these criminal offences has not become final;
7) declaration of the director of a domestic legal entity that its founder is not the person who has forfeited the status of buyer.
An application of a foreign natural person to participate in an auction shall include:
1) auction sale code and the trade name of the entity to be privatised;
2) name and surname;
3) name and surname of one of the parents;
4) address, citizenship, individual identification number and signature;
5) account number for refunding the deposit;
5a) confirmation of the competent authority, which is not older than six months, that he has not been convicted for the criminal offences from the Article 20a item 1) of this Decree, and declaration that any indictment against him for these criminal offences has not become final in accordance with legislation of the state which citizenship this natural person has;
6) declaration of the foreign natural person indicating that he is not a member of a family of the person who has forfeited the status of buyer.
An application of a foreign legal entity to take part in an auctions shall include:
1) auction sale code and trade name of the entity to be privatised;
2) trade name and identification number;
3) name and surname of the director and his signature;
4) certified photocopy of the Court Register excerpt;
5) certified photocopy of the authorization for representation at the auction, issued by the competent body;
6) account number for refunding the deposit;
6a) confirmation of the competent authority, which is not older than six months, that the natural person who is a control member and/or control shareholder of that business company has not been convicted for the criminal offences from the Article 20a item 1) of this Decree, and declaration of that person that any indictment against him for these criminal offences has not become final in accordance with legislation of the state which citizenship this natural person has;
7) declaration by a person authorised for representation of the foreign legal entity that its founder is not the person who has forfeited the status of buyer.
The applications specified in paragraphs 1 through 4 of the present Article should include also information on whether the application relates exclusively to the second bidding at which the means of payment may be in immature bonds as well.
In the event of sale of an allotment, paragraph 5 of the present Article shall not apply.
Article 22
The filled out application form for taking part in an auction and the signed draft contract shall be forwarded to the Agency. The integral part of the application to take part in the auction shall be the evidence for the payment of deposit.
The deposit in cash shall be considered paid in, when the amount specified as deposit is filed in the Agency's account.
In case of sale of an allotment, the deposit in cash shall be considered paid in when the amount specified as deposit is filed in the Agency's account.
The filled out application form for taking part in the auction, the signed draft contract, and the evidence as to the effected payment of deposit shall be forwarded to the Agency within a time limit that may not be shorter than five working days prior to the date determined for holding the auction.
Article 23
The Agency shall be obliged to inform the interested natural persons and legal entities, at least two working days prior to the date determined for holding the auction, about the approval of the application to take part in the auction.
The Agency may forward a request to interested natural persons and legal entities to supplement or amend the applications to take part in the auction that do not include complete documentation which is necessary, within two days following the day of forwarding the notification specified in paragraph 1 of the present Article.
Information regarding the number of participants in the auction shall not be given prior to the holding of auction.
The Agency may decide to cancel an auction after finding that the principle of free market competition is violated, and shall inform accordingly the interested natural persons and legal entities.
1. Registration of Auction Participants
Article 24
The procedure of registration shall be conducted by the Commission.
The registration shall include:
1) the verification of identity of applicant or his representative;
2) the verification of authenticity of representative's authorization;
3) the verification of the Agency's approval for taking part in the auction;
4) the issuing of a numbered auction card;
5) the signature of applicant of the representative on the list of participants.
Interested persons who have obtained the approval referred to in Article 23, paragraph 1 of the present Decree, but have failed to be registered for the auction, shall forfeit the right to the refund of deposit. The right to the refund of deposit shall also be forfeited by persons who have been registered for the auction but have failed to come up to the bidding.
Article 25
The Commission shall commence the registration of participants in the auction two hours prior to the beginning of the auction, at the place of holding the auction.
The registration of participants shall be completed 10 minutes prior to the beginning of the auction.
It shall be considered that the conditions for holding an auction are fulfilled should at least one applicant obtain the status of participant in the auction, should he be present at the auction, or should his authorised representative be present at the auction.
In case the conditions referred to in paragraph 3 of the present Article are not fulfilled, the Commission shall declare the auction failed.
Article 26
The auction shall be public and all interested persons may attend it.
Article 27
The Commission chairman shall be bound to provide equal treatment of all participants in an auction and an undisturbed procedure of putting forward of offers.
Article 28
At the time determined as the time of commencing an auction, the auctioneer shall open the auction and:
1) announce the trade name of the entity to be privatized and the auction sale code;
2) announce the percentage of capital and/or property offered for sale;
3) announce the initial price and explain further course of auction procedure;
4) invite the participants to ask for clarification, should there be vagueness.
The participants who are not content with the announcement specified in paragraph 1 of the present Article may lodge a verbal objection into the minutes , which shall not hinder the auction.
The Commission chairman shall decide on well-foundedness of the objection specified in paragraph 2 of the present Article.
Article 29
Should only one person obtain the status of participant in an auction, such person shall be invited to accept the initial price by raising the auction card.
Should the person specified in paragraph 1 of the present Article accept the initial price at the first bidding, he will be declared the buyer, and the initial price at the auction shall be the sale price, while should he fail to accept the initial price, the first bidding shall be declared failed and the second bidding will begin immediately.
Should the person specified in paragraph 1 of the present Article accept the initial price at the second bidding, he shall be declared the buyer, and the initial price at the auction will be the sale price, while should he fail to accept the initial price, the auction shall be declared failed, and such person shall forfeit the right to the deposit refund.
Article 30
In case of sale of an allotment, should only one person obtain the status of the participant in an auction, such person shall be invited to accept the initial price by raising the auction card.
Should the person specified in paragraph 1 of the present Article accept the initial price, he shall be declared the buyer, and the initial price will be the sale price, while should he fail to accept the initial price, the first auction shall be declared failed, and such person shall forfeit the right to the deposit refund.
2.2. Auction with More than One Participant
Article 31
Should more than one person obtain the status of the participant in an auction, the auctioneer shall announce the initial price, determine every subsequent increase of the price, and invite the participants to make an offer by raising the auction card.
Should there be an offer at the initial price level, the auctioneer shall determine a new price, after indicating the previous increase in price, and shall invite the participants to make an offer to the newly determined price.
A new price shall be determined repeatedly, as long as the participants make offers to the repeatedly determined prices.
Should after the second invitation by the auctioneer no offer be made to the last determined price, the auctioneer will make the last invitation to participants to make an offer.
Should even after the third invitation of the auctioneer no offer be made, the auctioneer shall, by banging the hammer, declare the auction finished, and proclaim the buyer a participant who was the first to offer the highest price.
Should no participant, even after the third invitation by the auctioneer, accept the initial price at the second bidding, the auction will be declared failed, and the participants will forfeit the right to the deposit refund.
In case of sale of an allotment, the auction shall be declared failed, and the participants will forfeit the right to the deposit refund if none of the participants even after the third invitation by the auctioneer accept the initial price at the auction.
Article 32
The auctioneer shall be authorised to take measures in order to provide for an undisturbed course of bidding.
The auctioneer shall publicly warn a participant for the disruption of the course of bidding, and shall caution the participants about measures to be taken in case of a continued disruption.
Should a participant specified in paragraph 2 of the present Article disrupt the course of auction even after the warning, the auctioneer will impose on him the measure of his removal, that is carried out voluntarily or by authorised persons, in charge of keeping the order at the auction.
A participant will disrupt the course of the procedure should he:
1) make offers contrary to rules;
2) disrupt the work of the auctioneer or the Commission in any other way.
A participant under the measure of removal shall not be entitled to the deposit refund.
Article 33
A participant under the measure of removal specified in Article 32, paragraph 3 of the present Decree may lodge a verbal objection into the minutes.
The objection referred to in paragraph 1 of the present Article shall not postpone the auction, and the well-foundedness of the objection shall be decided by the Commission immediately upon its lodging.
The decision of the Commission on the objection shall be final.
Article 34
The measures specified in Article 32, paragraph 3 of the present Decree may as well be imposed by the auctioneer to other persons present.
Article 35
Should an auctioneer perform the prescribed duties contrary to rules, the Commission chairman shall be authorised to:
1) warn the auctioneer;
2) replace him by an assistant auctioneer.
2.4. Means and Terms of Payment in an Auction
Article 36
Means of payment in an auction may be domestic and foreign convertible currency.
Means of payment may also be bonds issued on the ground of unpaid foreign currency savings debt to citizens, which mature by the date of capital and/or property sale, inclusive, and which are issued to natural persons - citizens of the Republic of Serbia.
Should in the first bidding the capital or property be not sold against the means of payment specified in paragraphs 1 and 2 of the present Article, the means of payment at the second bidding may also be the bonds on the ground of unpaid foreign currency savings of citizens, issued to natural persons - citizens of the Republic of Serbia, which have not matured by the date of capital and property sale.
The means of payment shall not be the bonds on the ground of unpaid foreign currency savings of citizens issued to natural persons - citizens of the Republic of Serbia, and which have not matured by the date of capital and/or property sale, where the stipulated price is to be paid in six annual installments, at the most.
Should the second auction referred to in Article 4 of the present Decree be declared failed, the Agency shall decide as to whether the capital of the entity to be privatized should be offered at some future auction.
Article 37
In case of payment at an auction with mature and/or immature bonds, such bonds shall be transferred to the proprietary account of the Agency, opened at the Republic of Serbia as a member of the Central Register, Depot and Securities Clearing, joint-stock Company, Belgrade.
The sale of bonds specified in paragraph 1 of the present Article shall be effected by the Agency.
The bonds specified in paragraph 1 of the present Article shall be sold on the financial stock exchange through a broker-dealer society of the stock exchange member.
The means effected by the sale of bonds specified in paragraph 1 of the present Article shall be paid in to the account of the Agency.
The means specified in paragraph 4 of the present Article, after covering the expenses of sale in the privatization procedure, and special recompense effected by concluding a contract of sale of capital and/or property (commission), as well as the priority settlement of creditors of the entity to be privatized - shall be paid in to the budget account of the Republic of Serbia.
Article 38
In case of sale of an allotment, the means of payment in an auction shall be domestic and foreign convertible currency.
Article 39
Should a buyer proclaimed at the auction be a domestic natural person, the sale price may be paid in six annual installments at the most.
The person from the paragraph 1 of this Article, cannot pay agreed price in installments, if he has payed in that way the buying of capital and/or property of at least two subjects of privatization.
The provisions from the paragraph 2 of this Article shall apply also to a natural person who is, or who has been, a member of a consortium of natural persons, if that consortium has been a buyer of capital and/or property of at least two subjects of privatization.
The provision specified in paragraph 1 of the present Article shall not apply in case of associating between a natural person and an entity for the purpose of buying capital or property of one entity to be privatized (consortium), and of the sale of capital of the entity to be privatized that has been restructured.
Should the deposit exceed the amount of the first installment, the remaining amount shall be distributed into five equal annual installments, whereby the first installment will be paid within a year time following the day of holding the auction.
The installments shall be indicated in EURO, with the proviso that each annual installment be paid, by the date of maturity, in Dinar counter-value at the medium rate of exchange of the National Bank of Serbia.
Article 40
In case of sale of an allotment, the proclaimed buyer shall not pay the sale price in installments.
Article 41
Official records of auction shall be kept of the commencement, course and conclusion of an auction (hereinafter: minutes).
Article 42
The minutes shall include:
1) the list of registered participants;
2) the initial price;
3) the final selling price achieved in the bidding and the data about the buyer;
4) means and terms of payment;
5) if any, the two last offers being made;
6) surname and name of chairman, other members of the Commission, auctioneer, assistant auctioneer and the minutes-keeper;
7) date and time of the commencement and conclusion of auction;
8) measures imposed on participants and the persons present;
9) objections by the applicants;
10) other data relevant to the Commission's work.
Article 43
The minutes shall be signed by:
1) the Commission chairman, Commission members, the auctioneer and/or assistant auctioneer, and the minutes-keeper;
2) the buyer or his authorised representative;
3) a participant in the auction, if any, who has made the second highest offer to the price offered.
Article 44
The minutes shall be made out in three identical copies, two of which shall belong to the Agency, and one to the buyer. A copy of the minutes will be forwarded, at its demand, to the entity to be privatized.
In case of sale of an allotment, a copy of the minutes shall be forwarded to the Share Fund as well.
Article 45
The Agency may decide to annul an auction after finding that the participants have disturbed, by their conduct at the auction, the principle of free market competition.
The following acts shall particularly be considered as disturbance of the principle referred to in paragraph 1 of the present Article:
1) should more than one person obtain the status of a participant at the auction, and none of the participants accept the initial price at the first bidding;
2) should more than one person obtain the status of a participant at the auction, and only one participant accept the initial price at the first bidding;
3) should more than one person obtained the status of a participant at the auction, and only two participants respond to auctioneer's invitation to take part in the bidding;
4) should initial price at the second bidding be accepted by a participant in the auction registered for the second bidding only, if no participant registered for the first bidding only has accepted the initial price at the first bidding.
Paragraphs 1 and 2 of the present Article shall accordingly apply to the sale of an allotment.
V ENTERING INTO A CONTRACT OF SALE
Article 46
Upon declaring a buyer, signing the minutes and entering into the contract of sale, the buyer shall pay the amount pursuant to the contract of sale entered into with the Agency.
In case of sale of an allotment, the contract of sale of the allotment shall be signed by the Share Fund.
Article 47
Should the declared buyer fail to sign the minutes, or to sign the sale agreement or to effect payment within the stipulated time limit, and there were other offers, the contract of sale shall be concluded with the participant who has made the second highest offer at the price offered by such participant in the auction.
Article 48
Should the declared buyer fail to sign the minutes or fail to effect payment within the stipulated time limit, and there were no other offers, the auction shall be repeated under the same conditions.
Should the participant who made the second highest offer refuse to enter into the contract of sale or fail to effect payment within the stipulated time limit, the auction shall be repeated under the same conditions.
Article 49
The buyer's deposit shall be included into the sale price.
No interest shall be calculated for the deposit paid in.
VI ACTIVITIES FOLLOWING A CONDUCTED AUCTION
Article 50
A deposit shall be refunded to the participants who did not acquire the right of the buyer, within eight days following the day of holding the auction, except for the cases specified in the present Decree.
The deposit shall be refunded within 21 days following the day of holding the auction to a participant who made the second highest offer.
Should the Agency fail to refund the deposit within the time limit specified in paragraphs 1 and 2 of the present Article, it shall be bound to pay the interest on arrears, in conformity with the law regulating the rate of interest on arrears.
The Agency shall inform on the result of auction the Central Register, Depot and Securities Clearing, joint stock Company, Belgrade, within three days following the day of entering into contract with the buyer.
Article 51
After an auction has been conducted, the Agency shall announce the results in the public media in which the public invitation specified in Article 9 of the present Decree was announced, within seven days, at the latest, following the date of completing the public auction.
Article 52
Complete documentation of the auction shall be handed over by the Commission to the Agency, on the day following the date of holding the auction.
The documentation referred to in paragraph 1 of the present Article shall be kept safe for at least three years following the date of the receipt.
In case of sale of an allotment, the Commission shall hand over a copy of the complete auction documentation to the Share Fund.
Article 53
A privatization program included in the auction documentation shall be handed over by the entity to be privatized to the Agency, within the time limits and in the mode specified by law.
1. Contents of Privatization Program
Article 54
A privatization program shall include:
1) basic information about the entity to be privatized;
2) data about the condition of assets and liabilities;
3) an analysis of past business operation of the entity to be privatized;
4) data relating to estimate of the value of capital;
5) attachments.
Article 55
Following shall be the basic data relating to an entity to be privatized:
1) entity's trade name;
2) registered head office and address;
3) identification number from the statistics;
4) indication and code of activity;
5) name and surname of director;
6) form of organization;
7) telephone and fax numbers;
8) gyro account number;
9) association status of the entity to be privatized, where the entity to be privatized is an enterprise.
Article 56
Data about the condition of assets and liabilities shall include:
1) the last balance sheet which has been verified by the National Bank of Serbia;
2) list of real property (type, purpose and surface of the facilities, purpose and surface of land);
3) survey of the most important equipment;
4) survey of property and receivables that are the subject of litigation at the court, indicating the amount of disputed claims;
5) survey of liabilities which are the subject of litigation at the court, with the indication of the amount of disputes' value;
6) survey of property under collateral and the survey of property of other legal entities over which the entity to be privatized possesses a collateral.
Article 57
An analysis of past business operation shall include:
1) survey of organisational structure with the indication of the number of employees, the age and qualification structure;
2) survey of basic products and/or services;
3) survey of gross income specified by basic types of products and/or services, and the structure of market;
4) survey of operating costs;
5) structures of income statement pursuant to the annual accounts for the last three years.
Article 58
Data on the estimate of the value of capital shall include:
1) total estimated value of capital;
2) estimated value of capital;
3) private capital value;
4) estimated value of capital that is to be privatized in the range from the lowest to the highest value.
Article 59
The following documentation representing the integral part of the privatization program has to be enclosed to the privatization program by the entity to be privatized:
1) decision by the body in charge on the adoption of program;
2) certified photocopies of the ruling on entering into the register kept by the agency in charge and, if necessary, certified photocopies of the ruling on compliance with the law;
3) certified photocopies of the ruling on entering into the register kept by the competent body of legal entities whose founder or co-founder is the entity to be privatized;
4) statute;
5) certified photocopies of land register excerpts and/or property law documentation relating to immovables owned by the entity to be privatized, or over which it has indefinite rights of use;
6) certified photocopies of the ruling on filed collaterals over immovables and the crediting contracts secured by the collateral;
7) certified photocopies of the ruling on collaterals over other owners' immovables to the benefit of the entity to be privatized, and documents relating to the ground and amount of receivables secured by the collateral;
8) certified photocopies of contracts on renting of the entity to be privatized or of its part;
9) certified photocopies of contracts on renting out of immovables and equipment;
10) certified photocopies of contracts on renting of immovables and equipment and on leasing;
11) list of existing shareholders or limited liability company members, with individual stakes in the private capital;
12) certified photocopies of contracts of credits, with installments and repayment schedules;
13) two last balance sheets and profit and loss statements which have been verified by the National Bank of Serbia;
13a) report of changes in capital for the last business year;
14) gross balance sheet for the preceding business year for which the the balance sheet and profit and loss statement have been made.
If the subject of privatization cannot deliver documentation from the paragraph 1 item 5) of this Article, property right or right of indefinite use can be proved with other proofs (legally effective decision of the competent authority, legal documents made in accordance with law, the agreement about compensation for the expropriated imovable property etc.) or with a statement made under full moral, material or criminal responsibility, that he is the proprietor or user of that immovable property.
If the subject of privatization was created through reorganization, in the sense of the law regulating the legal status of business societies, cannot enclose the proofs from the paragraph 1 item 5) of this Article, property right or right of indefinite use can be proved with dividing balance-sheet or with other adequate document and/or legally effective court decision brought in a lawsuit procedure or with a statement made under full moral, material or criminal responsibility, that he is the proprietor or user of that immovable property.
Enclosed to the privatization program shall also be a statement of the person in charge in the entity to be privatized relating to the accuracy of data included in the privatization program.
In case of sale of the capital and/or property of an entity to be privatized that has been restructured, the integral part of privatization program shall be the restructuring program as well.
In terms of the present Decree, understood as a land register excerpt specified in paragraph 1 item 5) of the present Article shall also be a note entered in advance and/or a note entered into land register, in conformity with the regulations covering the books of title of immovables.
Article 60
In addition to documentation specified in Article 59 of the present Decree, an entity to be privatized shall also submit the decisions adopted by the body in charge that are necessary for conducting the privatization procedure, and particularly:
1) decision on issuing the shares;
2) decision on the transfer of up to 30% of the socially-owned capital free of charge to the employees;
3) decision on the sale of 70% of the socially-owned capital; and
4) decision on announcing a public invitation for subscription of the free-of-charge shares.
Articles 61 and 62
(Deleted)
Article 63
If a privatization program is made in accordance with the law and the present Decree, the Agency shall render a ruling on approving the privatization program (hereinafter: ruling) within 30 days following the date of submitting the privatization program, and shall forward it to the entity to be privatized.
Article 64
Should a privatization program fail to include the elements specified in articles 55 through 58 of the present Decree, or should corrections or amendments be needed, the Agency shall return, within 30 days following the date of submission, and by stating the reasons in writing, the privatization program to the entity to be privatized, for the purpose of its supplementing and correction.
Article 65
The Agency may amend the privatization program, and/or make the privatization program, in compliance with the law and the present Decree.
The Agency shall inform, in writing, the entity to be privatized about the amendments and/or making the privatization program.
Article 66
The privatization program shall be forwarded to the Agency in two certified copies and two photocopies, together with the decision by the body in charge in the entity to be privatized relating to its adoption.
Upon the approval of the privatization program, one copy, verified by the Agency, shall be returned to the entity to be privatized, at its request.
VIII TRANSITIONAL AND CONCLUDING PROVISIONS
Article 67
Transfer and/or sale of bonds in the mode specified in Article 37 of the present Decree shall refer to mature and/or immature bonds that are not transferred to the proprietary account of the Agency, opened at the Republic of Serbia as a member of the Central Register, Depot and Clearing of Securities, joint stock Company, Belgrade, and/or that are not sold until the day of coming into force of the present Decree.
Article 68
The proceedings of sale of socially-owned and state-owned capital of an entity to be privatized by public auction method, commenced until the day of coming into force of the present Decree, shall be completed pursuant to the regulations that were in force on the date of expiration of deadline for submitting the application to take part in the auction.
Article 69
The Decree on Sale of Capital and Property by Public Auction ("Official Herald of the RS", No. 45/01, 45/02, 19/03, 59/04 and 98/04) shall cease to be valid on the day of coming into force of the present Decree.
Article 70
The present Decree shall come into force on the eighth day following the day of publication in the "Official Herald of the Republic of Serbia".
Independent Articles of the Regulation
on Amendments and Supplements to the
Decree on Sale of Capital and Property
by Publi Auction
("Official Herald of the Republic of Serbia", No. 91/2007)
Article 11[s1]
The procedures of selling of capital and property by the method of public auction which have been started until the day of entering into force of this Regulation shall be continued in accordance with the provisions of this Regulation.
Article 12[s1]
This Regulation shall enter into forceon the eighth day following the day of its publication in the "Official Herald of the Republic of Serbia".