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Okrajno sodišče in Ljubljana rejects Agrokor's appeal to the AVK ruling on interim seizure of Mercator shares

Agrokor expresses regret over the Court's decision and shall use all available legal means in order to achieve annulment of the Agency's final decision and secure its ownership authorities in Mercator

On 3rd January 2020 Agrokor sent letters to international rating agencies – Fitch, Moody's, Standard&Poor's, as well as the World Bank offices in Washington and Brussels and Transparency International offices in Brussels and Berlin to inform them in detail of the obstacles it has been facing as investor in Slovenia over the last year

 

Okrajno sodišče in Ljubljana has rejected Agrokor's appeal to the ruling of the Public Agency for the Protection of Competition of the Republic of Slovenia (Javna agencija za varstvo konkurence) dated 16th December 2019, whereby the Agency issued an order to temporarily seize Agrokor's shares in Mercator as security for the enforcement of the non-final ruling of the Agency of September 2019 imposing a fine of EUR 53.9m on Agrokor due to an alleged misdemeanor – failure to file for concentration.

With the explanation that the appellant's interpretation of the institute from Art. 201, paragraph 5 of the Misdemeanor Act (ZP-1), the content and sense whereof is only limited to natural persons and items that natural persons are carrying with them, was purportedly too narrow, in deciding on the appeal the Court has not recognized Agrokor's key complaint in the appeal that the Agency in this specific case had no legal justification to issue a decision on the interim seizure of Mercator shares. By superficially reading the provisions of the Act on Preventing the Limitation of Market Competition (ZPOmK-1 /Zakon o preprečevanju omejavanja konkurence/) the Court has also rejected Agrokor's ground of appeal that the Director of the Agency was not competent to make the decision on the interim seizure of shares. According to Agrokor's understanding of ZPOmK-1, such decision can only be made by the Misdemeanor Council.

Agrokor expresses regret over the decision of the competent court in Ljubljana that has made the Agency's decision final and non-appealable.

As the explanation of the decision of the court Okrajno sodišče of Ljubljana is unconvincing and legally weak, Agrokor still holds that the Agency's decision is unconstitutional, arbitrary and unlawful as well as that in passing the ruling on the interim seizure of shares the Agency also grossly breached procedural provisions. In order to achieve the annullment of the Agency's final and non-appealable decision, Agrokor shall use all available legal means against the decision of the Agency and the decision of the Court Okrajno sodišče of Ljubljana, all with a view to exercising its ownership authorities in Mercator. 

Of the controversial conduct of the Slovenian Agency in this procedure, as well as of its suspicion that, contrary to Slovenian legislation and EU practices, the transfer of Mercator shares from Agrokor to Fortenova Group has been prevented by the Slovenian administrative and other authorities for national political reasons, Agrokor has already informed the heads of European and national competition protection authorities, as it holds that by its conduct the Agency has not only breached the national legislation but also international rules, obligations and principles, which may have very serious consequences for the creditors and in the broader sense also gives rise to doubt the credibility of EU regulations in the area of competition protection and uniform insolvency legislation.

On 3rd January 2020 Agrokor also sent letters to international rating agencies – Fitch, Moody's, Standard&Poor's, as well as the World Bank offices in Washington and Brussels and Transparency International offices in Brussels and Berlin to inform them in detail of the obstacles it has been facing over the last year as investor in Slovenia.

Agrokor has informed the above institutions of the actions taken by Slovenian authorities because these are international institutions which determine country ratings, publish Doing Business rankings (World Bank) and corruption perception index rankings (Transparency International), and because Agrokor believes that these institutions should be made aware of the breach of investors' legitimate expectations as to the application of law and practice to investments within the EU, discrimination on grounds of nationality regarding investments within the EU and breaches that amount to a denial of justice and an unlawful expropriation of intra-EU investment.

In Agrokor's opinion, such treatment of investors clearly adversely affects the perception of Slovenia by foreign investors, as expressed through the ratings as well as its position on the Doing Business and Corruption Perception Index lists.

Agrokor therefore believes that the entire development in this specific case should be kept in mind in creating future ratings for Slovenia as well as in various business rankings of the country in terms of the conditions of doing business and measuring its level of corruption, the transparency of work of its institutions and the (lack of) success in preventing misuse of public authority.