LAWON RIGHT TO GRATUITOUS SHARES AND PECUNIARY COMPENSATION TO BE REALIZED BY CITIZENS IN PRIVATIZATION PROCEDURE("Official Herald of the Republic of Serbia", No. 123/2007) |
Article 1
The present Law governs the realization of the right of citizens to pecuniary compensation on the ground of sale of shares or stocks (hereinafter: pecuniary compensation), filed in the Privatization Registry kept pursuant to the Law on Privatization ("Official Herald of the RS", Nos. 38/2001, 18/2003 and 45/2005*), and the transfer of shares of enterprises and companies specified by the present Law (hereinafter: transfer of shares).
The present Law also governs the realization of the right of employees and former employees in enterprises and commercial companies referred to in paragraph 1 of the present Article, to the gratuitous transfer of shares of these enterprises and commercial companies.
Article 2
Rights in conformity with the present Law shall be realized by persons meeting the ensuing requirements:
1) to be eighteen years of age on 31 December 2007 inclusive, and to be, on the day of acquiring the right-holder’s status, filed in the register of voters of competent municipal agencies;
2) to be, on the day of entering into force of the present Law, the citizens of the Republic of Serbia;
3) to have had on 30 June 2007 the domicile on the territory of the Republic of Serbia and/or the status of a temporary displaced person from Kosovo and Metohija;
4) to have not, totally or partially, in any way realized the right to gratuitous shares in conformity with the Law on Ownership Transformation ("Official Herald of the RS", Nos. 32/1997 and 10/2001) or the Law on Privatization, and
5) to be filed in the right-holder records kept by the Agency for Privatization (hereinafter: Agency), in conformity with the present Law.
Persons referred to in paragraph 1 of the present Article shall forfeit, on the day of gaining the right-holder status, the right to acquire the capital? free of charge pertaining to employees in an entity to be privatized pursuant to the Law on Privatization.
On the day of gaining the status of the right-holder, the persons specified in paragraph 1 of the present Article shall forfeit the right to acquiring gratuitous capital granted to employees in the entity to be privatised in compliance with the Law on Privatization.
Equality in Realization of Right
Article 3
Persons referred to in Article 2 of the present Law (hereinafter: right-holders) shall acquire the right to an equal amount of pecuniary compensation and an equal number of shares of every enterprise and/or commercial companies as stipulated by the present Law.
Article 4
The right to gain the right-holder’s status shall not be transferable and may not be the subject of inheritance.
The right to pecuniary compensation and the right to transfer of shares, from the day of filing in the rights-holder records until the day of receipt of pecuniary compensation, and/or filing of a rights-holder as the lawful owner of shares that are the subject of gratuitous transfer to the Central Registry, depot and securities clearing (hereinafter: Central Registry) shall not be transferable, nor shall it be the subject of any kind of disposal, including pledging as a collateral to grant security and other legal transactions to the same or similar effect.
In case of demise of a person who filed the application to be recorded in the right-holder records pursuant to the present Law, and/or death of a person who gained the right-holder’s status, the heirs of the person in question shall acquire and/or exercise the right to pecuniary compensation and the right to transfer of shares under the conditions and in the mode these rights would be gained and/or realized by the person they have inherited.
Any HOLDING of shares contrary to provisions of paragraphs 1 through 3 of the present Article shall be deemed null and void.
II PROCEDURE OF FILING OF RIGHTS - HOLDERS
Article 5
The rights-holder records shall be kept by the Agency as a public and electronic data base (hereinafter: rights-holder records).
Application for Filing in Rights-holder Records
Article 6
The application for filing in the rights-holder records shall be submitted in compliance with public invitation announced by the Agency (hereinafter: public invitation).
The deadline for submitting the application specified in paragraph 1 of the present Article shall be specified in the public invitation with the provision that it may not be shorter than 6 months from the day of announcing the public invitation.
Persons referred to in Article 2 of the present Law who fail to submit the application specified in paragraph 1 of the present Article until the expiry of deadline indicated in public invitation shall not acquire the right-holder status and shall not exercise the right to pecuniary compensation and/or to transfer of shares.
Filing in the Right-holder Records
Article 7
The Agency shall file in the rights-holder records the person who submitting the application within the time limit indicated in public invitation and satisfying the requirements specified in Article 2, paragraph 1, items 1 through 4 of the present Law.
Article 8
The Agency shall dismiss by a resolution a lapsed application or the one submitted by a person not meeting the requirements referred to in Article 2, paragraph 1, items 1 through 4 of the present Law.
The Agency shall also dismiss by considered opinion an application not submitted pursuant to public invitation, if it previously called on the applicant to rectify the application and the applicant did not act accordingly within the indicated deadline.
The resolution referred to in paragraphs 1 and 2 of the present Article shall not be delivered by hand to the applicant, but shall be announced in Agency’s internet page, while the list of all applicants whose application is dismissed by the considered opinion shall be published in the "Official Herald of the Republic of Serbia", and in one of the daily papers distributed in the entire territory of the Republic of Serbia; the publication date such list in the "Official Herald of the Republic of Serbia" shall be deemed the day of delivery of the resolution
Right to Appeal and Instituting Administrative Proceedings
Article 9
The person whose application is dismissed shall be entitled to an appeal to the minister in charge of privatization affairs (hereinafter: minister) within 30 days from the date deemed to be the day of delivery of the considered opinion referred to in Article 8, paragraph 3 of the present Law.
The Minister shall decide on the appeal within a 60 day time limit.
In deciding on the appeal specified in paragraph 1 of the present Article, the minister may:
1) dismiss by a considered opinion an untimely appeal or an appeal submitted by unauthorized person;
2) turn down the appeal as ungrounded;
3) order by a ruling that the applicant be filed in the records.
Administrative proceedings may be instituted against the considered opinion and the ruling specified in paragraph 3 of the present Law within 30 days from the date of delivering the resolution and/or ruling.
Detailed Regulation of Procedure and Mode of Right-holder Records
Article 10
The Government shall regulate the details of procedure and mode of the right-holder records.
III SALE OF SHARES AND STAKES FILED IN THE PRIVATIZATION REGISTRY
Right to Pecuniary Compensation
Article 11
A right-holder shall exercise the right to pecuniary compensation from the proceeds received through the sale of shares and/or stakes filed in the Privatization Registry (hereinafter: shares and stocks).
Sale of Shares and Stakes filed in the Registry
Article 12
Procedure of sale of shares and stakes shall be conducted by the Share Fund.
Shares of the open-type joint-stock companies shall be sold:
1) in the organized market:
2) by accepting a take over bid;
3) by invitation for tenders (auction).
Shares of closed-type joint-stock companies as well as stocks of closed-type joint-stock companies shall be sold by invitation for tenders (auction).
By way of exception from paragraphs 2 and 3 of the present Article, the shares and/or stakes may be sold by collection of offers as well.
Decision on the mode of sale of shares and stakes shall be rendered by the Agency.
Price per share at which the Share Fund sells the shares may not be under the per share price paid by the buyer in the privatization procedure.
Price per share at which the Share Fund sells the stakes may not be under the price paid for the portion of capital of the entity to be privatised in the course of privatization procedure.
The Share Fund can, with the prior consent of the Agency, by way of the contract entrust the sales of the shares i.e. stocks to the domestic or foreign specialised financial organizations or brokerage firms.
The Government shall regulate the details of procedure of sale of shares and stakes.
Time Limit for Sale of Shares and Stakes
Article 13
The Share Fund shall be obliged to sell the shares and stakes until 31 December 2008, and/or within 6 months from the date of transfer of shares and/or stock to the Privatization Registry, if shares and/or stakes are transferred to the Privatization Registry after 30 June 2008.
Ban on Transformation of Open-Type Joint-Stock Companies into Closed-Type Joint-Stock Companies and Limited Liability Companies
Article 14
An open-type joint-stock company may not change its legal form into a limited liability company, and an open-type joint-stock company may not be transformed into a closed-type joint-stock company until the completion of sale of all shares of that company, in conformity with the present Law.
Article 15
A dividend on the grounds of shares and/or profit on the grounds of stakes filed in the Privatization Registry shall be paid out to the republic fund in charge for employees’ pension and disability scheme until the completion of procedure of sale of shares and/or stakes, in compliance with the present Law.
The Central Registry shall calculate the dividends yield for joint-stock companies whose shares are filed in the Privatization Registry.
The right to management may not be exercised on the grounds of shares and/or stakes until their sale is effected in conformity with the present Law.
Payment of Pecuniary Compensation
Article 16
The sale of shares and stakes by the Share Fund shall not be subject to the tax on trade of absolute rights.
Proceeds received through the sale of shares and stakes, after deducting the sale costs, shall be transferred to a separate account of the Share Fund opened for that purpose.
The proceeds specified in paragraph 2 of the present Article shall be used exclusively for payment of pecuniary compensation in conformity with the present Law, and may not be the subject of compulsory winding - up or settling debts with creditors.
The minister shall prescribe the mode of calculation of costs referred to in paragraph 2 of the present Article.
Pecuniary compensation shall be paid off to the right-holders in the mode and within the time limits prescribed by an act of Government.
Abortive Sale of Shares and/or Stakes
Article 17
If shares and/or stakes of a given company are not sold prior to the deadline referred to in Article 13 of the present Law, such company shall be obliged to provide, within additional 180 days, in conformity with the law regulating the securities market, that the portion of capital of that company filed in the Privatization Registry be distributed onto the number of ordinary voting shares, the number of which is equal to total number of rights-holders, by applying one of the following modes:
1) by exchanging the existing ordinary voting shares, if it operates as an open-type joint-sock company, or
2) by being organized as an open-type joint-stock company and by issuing of ordinary voting shares, if it does not operate as an open-type joint-stock company.
The Central Registry shall transfer the shares from the Privatization Registry, issued in conformity with paragraph 1 of the present Article, to the right-holders under an order of the Agency.
The Share Fund shall be obliged to keep files of companies specified in paragraph 1 of the present Article and to monitor the performance of obligations prescribed in paragraph 1 of the present Article.
IV TRANSFER OF SHARES TO CITIZENS WITHOUT COMPENSATION
Right to Shares without Compensation
Article 18
Right-holders shall exercise the right to holding of shares without compensation (hereinafter: gratuitous shares) in the following public enterprises and/or commercial companies with the majority participation of State-owned capital, and/or commercial companies performing an activity of common interest:
1) Company for exploration, production, distribution and trade of oil and oil derivatives, and exploration and production of natural gas "Oil Industry of Serbia" Co., Novi Sad (hereinafter: NIS);
2) Enterprise for telecommunications "Telekom Srbija" Joint-stock company (hereinafter: Telekom Serbia);
3) Public Enterprise "Elektroprivreda Srbije", Belgrade (hereinafter: EPS);
4) Public Enterprise for air traffic "JAT Airways", New Belgrade (hereinafter: JAT);
5) Public Enterprise "Nikola Tesla" Airport, Belgrade (hereinafter: Airport);
6) Joint-stock company "Galenika" for the manufacture of medicaments, dentistry products, antibiotics, pharmaceutical raw materials, para-pharmaceutical products, veterinary products and additives, Belgrade (hereinafter: Galenika).
The capital for acquiring gratuitous shares in enterprises and commercial companies referred to in paragraph 1 of the present Article shall amount to 15% of fixed assets of each enterprise.
The provisions of the present Article shall apply also to legal successors of enterprises taking place through status changes carried out after entering into force of the present Law.
Enterprises where on the day of entering into force of the present Law there is no majority State-owned capital, shall be subject to provisions of the present Law from the day of acquiring the majority capital of the Republic of Serbia in the capital of that enterprise.
Distribution of Gratuitous Shares
Article 19
In compliance with an act of the Government, gratuitous shares of a single enterprise shall be transferred to right-holders within 6 months upon the completion of privatization of the enterprise in the matter, and until 31 December 2010 at the latest.
The completed privatization in terms of paragraph 1 of the present Article shall be deemed every sale of the State-owned capital (in its entirety or partially) in the enterprise, as well as every increase of capital or a constitutional changes resulting from the change of capital ownership structure of the enterprise, and rendering a specific number of enterprise’s shares privately-owned.
The time limit referred to in paragraph 1 of the present Article shall run from the day of filing the acquirer of shares in the Central Registry as a lawful holder of shares.
Tax Treatment of Acquiring and First Sale of Shares
Article 20
Acquiring of gratuitous shares by the right-holders pursuant to Article 18 of the present Law, as well as the first sale of gratuitous shares by right-holders, shall on no account be subject to payment of income tax of citizens, nor to the payment of tax on transfer of absolute rights.
Article 21
The Government shall conduct public procurement procedure to select brokerage-dealer companies and authorized banks (hereinafter: brokers) which shall carry out at right-holders’ order the first sale of gratuitous shares for those right-holders who decide to perform such a sale through brokers.
The costs of broker services referred to in paragraph 1 of the present Article shall be at the borne by the Budget of the Republic of Serbia for gratuitous shares the first sales of which is made until 31 December 2011.
Opening of Proprietary Accounts in the Central Registry
Article 22
The Central Registry shall, in line of duty and free of charge, open owner’s accounts of all right-holders according to the list of right-holders to be forwarded to it by the Agency - within 90 days from the date of receipt of the list.
The Belgrade Stock-Exchange shall not calculate and charge a fee for the first sales of shares without compensation which is effected until 31 December 2011.
The Central Registry shall neither calculate nor charge a fee for making the balance relating to the first sale which is effected until 31 December 2011.
V RIGHTS OF EMPLOYEES AND FORMER EMPLOYEES
Rights of Employees and Former Employees
Article 23
Employees and former employees in an enterprise where privatization is completed pursuant to Article 19 of the present Law shall realize the right to transfer free of charge of shares of that enterprise at the amount of 200 EUR per full single year of employment in that enterprise, calculated according to the assessed market value of the total capital of enterprise prior to the completed privatization, in Dinar counter-value at an average rate of exchange of the National Bank of Serbia, on the day of making the assessment, and for maximum 35 years of employment
Capital expressed in the form of shares, transferred free of charge to employees and former employees in conformity with paragraph 1 of the present Article, shall not make the part of capital for acquiring gratuitous shares that is transferred to citizens in conformity with Article 18 of the present Law.
The right specified in paragraph 1 of the present Article shall be realized also by former employees in proportion to years of service in that enterprise and in legal predecessors of that enterprise, apart from years of service on the ground of which they have realized the right to transfer of capital free of charge in conformity with the Law on Privatization, and to the maximum of 35 years of employment under both grounds.
Time Limit for Transfer of Shares
Article 24
Transfer of shares free of charge referred to in Article 23, paragraph 1 of the present Law to employees and former employees of single enterprise shall be carried out by an act of the Government within six months after the completion of privatization of that enterprise.
Employees and Former Employees
Article 25
Employees and former employees in terms of Article 23, paragraph 1 of the present Law shall be deemed to be the persons employed and formerly employed in enterprises and their legal predecessors, apart from former employees who, on the day of entering into force of the present Law, are employed with other commercial entities in which the privatization procedure is initiated, and who meet the following requirements:
1) to be eighteen years of age on 31 December 2007 inclusive, and to be, on the day of filing, filed in the register of voters of competent municipal agencies;
2) to be, on the date of entering into force of the present Law, the citizens of the Republic of Serbia;
3) to have had on 30 June 2007 the domicile in the territory of the Republic of Serbia and/or the status of a temporary displaced person from Kosovo and Metohija;
4) to have not in any way realized the right to shares free of charge pursuant the Law of Ownership Transformation;
5) to have not totally exercised the right to acquire capital free of charge pursuant to the Law on Privatization.
Former employee in terms of paragraph 1 of the present Article shall be deemed to include a retired person as well.
Employees and former employees in terms of paragraph 1 of the present Article shall be deemed to include:
1) in the case of NIS, employees and former employees in the enterprise, employees and former employees in the Public Enterprise Transnafta, Pančevo, and employees and former employees in the Public Enterprise Srbijagas, Novi Sad, as well as in their legal predecessors;
2) in the case of Telekom Serbia, employees and former employees in the enterprise, and employees and former employees in the Public Enterprise PTT communication of Serbia, Belgrade, as well as in their predecessors;
3) in the case of EPS, employees and former employees in the enterprise and employees and former employees in the Public Enterprise Electric Network of Serbia, Belgrade, the Public Enterprise for underground coal mining, Resavica, the Public Enterprise Excavation Kosovo, the Public Enterprise Thermo-electric Power Plants of Kosovo, and the Public Enterprise Electro-Kosmet, as well as in their legal predecessors.
Impossibility of Realization of Right under two Grounds
Article 26
Employees and former employees shall have no right provided for in Article 23, paragraph 1 of the present Law if they have acquired the right-holder status pursuant to the present Law.
Employees and former employees shall have no right to acquire the capital free of charge on the ground of the Law on Privatization against the years of employment as the basis for the right to transfer of shares free of charge realized pursuant to the present Law.
Appropriate Application of Provisions on Restricting Rights and Tax Exemptions
Article 27
Restrictions to transfer of rights referred to in Article 4 of the present Law shall accordingly apply to employees and former employees relating to realization of rights specified in Article 23, paragraph 1 of the present Law.
Realization of Right by Means of Pecuniary Compensation
Article 28
Should assessed market value of fixed assets of an enterprise be under 200 million EUR, the Government may decide that right-holders, and employees and former employees, instead of the transfer of shares without charge, be paid pecuniary compensation to the tune of the assessed market value of such shares.
The act referred to in paragraph 1 of the present Article may be passed also should the transfer of shares free of charge to right-holders and/or employees and former employees cause considerable loss to the enterprise, or should such transfer prevent or substantially hinder the carrying out of privatization in that enterprise.
Authority for Enacting Regulations
Article 29
The Government shall regulate details of the procedure of filing of employees and former employees, as well as the mode of determining the assessed market value of shares, and of the procedure of transfer of shares referred to in Article 23 paragraph 1 of the present Law.
Application of Provisions of the present Law to Public Enterprises
Article 30
Provisions of the present Law, in the part regulating the transfer of shares free of charge to citizens and the rights of employees and former employees, shall accordingly apply also to public enterprises and commercial companies with the majority State-owned capital which, in conformity with special regulations, perform an activity of common interest, should after entering into force of the present Law the privatization be carried out in these enterprises and/or commercial companies in terms of Article 19 of the present Law.
Special regulations governing the mode of privatization of specific enterprises and commercial companies referred to in paragraph 1 of the present Article may also specify a different mode of realization of rights of citizens and the employees
Article 31
Whoever, with the intention to accrue unlawful financial benefits for oneself or another person by misleading a rights-holder and/or an employee or former employee, or to keep him in error on false pretences or by withholding the facts, misleading him/her in such a way to enter into contract or another legal transaction relating to the transfer of right to pecuniary compensation or the right to transfer of shares, shall be punished by a fine or imprisonment of up to three years.
Whoever, with the intent to accrue for himself or for another unlawful financial benefits offers services of mediation between right-holders and/or employees and former employees, and agencies in charge of implementation of the present Law in the procedure of filing in the records of rights-holders and/or in the records of employees and former employees, or whoever offers without authority the services of filing in such records, shall be sentenced to fine and imprisonment up to three years.
Article 32
A fine of from 1.000.000 to 3.000.000 Dinars shall be incurred for commercial infraction on a commercial company acting contrary to the provision of Article 17 of the present Law.
A fine of from 50.000 to 200.000 Dinars shall be imposed for corporate felony as well, on a person liable for it in the commercial company specified in paragraph 1 of the present Article.
The fine specified in paragraph 1 of the present Article shall be incurred for corporate felony on a commercial company offering services of mediation between right-holders and/or employees and former employees, and agencies in charge of implementation of the present Law in the procedure of filing in the records of right-holders and/or filing in the records of employees and former employees, as well as on a commercial company offering without authority the services of filing in such records.
The fine specified in paragraph 1 of the present Article shall be incurred for corporate felony as well on a commercial company which perform a contract or other legal transaction with the right-holder and/or the employee or former employee on the transfer of the right to pecuniary compensation or the right to acquiring shares without compensation.
A fine of from 50.000 to 200.000 dinars shall be incurred for corporate felony as well, on a person liable for it, in the commercial company referred to in paragraphs 3 and 4 of the present Article.
Article 33
A fine of from 5.000 to 50.000 Dinars shall be incurred on a person who enters into contract or other legal transaction, as well as a person who, contrary to Article 4 of the present Law, unlawfully possesses in any other way of the right to pecuniary compensation or the right to acquire shares free of charge.
VIII TRANSITORY AND CONCLUDING PROVISIONS
Time Limits for Enacting Regulations on Implementing the Law
Article 34
The Government and the Minister shall enact regulations on implementing the present Law within 6 months from the date of its entering into force.
Termination of Validity of Provisions of other Laws
Article 35
On the day of entering into force of the present Law, the provisions of Article 52, paragraph 3 and Article 53 and 54 of the Law on Privatization shall cease to be valid.
On the day of entering into force of the present Law, the provisions of Article 9a of the Law on Public Enterprises and Performing of Activities of Common Interest ("Official Herald of the RS", Nos. 25/2000, 25/2002, 107/2005, and 108/2005 - corrigendum) shall cease to be valid.
Article 36
The present Law shall enter into force on the eighth day from the publication in the "Official Herald of the Republic of Serbia".