Published in Nacional number 778, 2010-10-12

Autor: Plamenko Cvitić


Inner cabinet at secret meeting on INA

THE DOCUMENT by which Damir Polancec invited his colleagues to a meeting in January of 2009 in order to inform them of the details of the privatisation of INA reveals that Ivan Suker and Marina Matulovic-Dropulic attended

SUSPECT MINISTERS Marina Matulovic-Dropulic admitted that she had attended the meetings, while Ivan Suker says that he was not informed of the details of the contractSUSPECT MINISTERS Marina Matulovic-Dropulic admitted that she had attended the meetings, while Ivan Suker says that he was not informed of the details of the contractAhead of the upcoming meeting of the parliamentary commission looking into the privatisation of oil company INA - which former Croatian Prime Minister Ivo Sanader has been called to testify before - once close associates in the Croatian Democratic Union (HDZ) and Croatian Government have embarked upon media spin wrangling. For the past few days claims have been coming out of the camp of former Deputy Prime Minister Damir Polancec that former deputy prime minister and current Prime Minister Jadranka Kosor was very much in the know when it came to the privatisation of INA. On the other side, the HDZ and Croatian Government refute these allegations, calling them fallacious claims allegedly advanced by former Prime Minister Ivo Sanader with the aim of further exacerbating tensions ahead of his testimony before the parliamentary inquiry.

SOME INTERNET PORTALS reported mid way through last week that several meetings had been held in late 2008 and early 2009 concerning the amendments to the stockholders' agreement between Croatian Government and Hungarian oil company MOL, and that also present at these meetings besides Damir Polancec, Ivan Suker and Marina Matulovic-Dropulic - was then Deputy Prime Minister Jadranka Kosor. As Prime Minister Kosor has to date said that she was not informed about the details of the privatisation of INA, and that she did not participate in amending the stockholders' agreement, Government's press office quickly issued a communiqué stating that the prime minister had not participated in these meetings, or rather that these meeting, with the cited persons in attendance, were not in fact ever convened.

BUT, EARLY this week some of the press received copies of a document that should shed light on the doubts concerning the meetings in question - an invitation to a meeting at the Ministry of Finance on 26 January 2009, at which the top item on the agenda were the "amendments to the contract on the mutual relations of the stockholders concerning INA d.d. and the master contract on gas operations." Invited to the meeting, as the document header indicates, were Ivan Suker, Marina Matulovic-Dropulic, the head of Government's Legislation Office Zdenka Pogaric and lawyer Zoran Markovic, with the meetings called by Deputy Prime Minister Damir Polancec. If the document is authentic, it directly refutes the claims made by Finance Minister Ivan Suker when giving his testimony to the parliamentary inquiry in mid September to the effect that he had no idea whether sessions of the commission on amendments to the stockholders' agreement with MOL were ever held, and that he did not attend any such meeting.

But if Suker was not present at sessions of the commission, it appears that he did attend the meeting organised by Polancec. If that is true, Suker, and the other participants of the meeting will find it hard in the future to claim that they were not informed of the content of the new stockholder's agreement on INA Polancec had hammered out in negotiations with the Hungarian-based MOL, and the contract on the natural gas operations on the basis of which Croatia took over the Croatian oil company's unprofitable natural gas operations. Both of these contracts have since then on several occasions been declared by the press to be damaging to Croatia, and it is to be assumed that the chief points of these deals, such as giving disproportionally greater management rights to MOL, were presented to those on hand by Polancec. It is, however, an open question just how candidly Polancec informed his colleagues of what had been agreed upon. After all, the former deputy prime minister reported on the deal struck with MOL at a session of Government on 24 December 2008, but did so in a very unusual way. According to the transcript from the session it turns out that Polancec did not mention at all that practically all key decisions concerning operational control of INA would be given over to the Hungarian company. What is more, Polancec enumerated in detail the new distribution of posts on the board of directors and the supervisory board, but in doing so left out some key details.

LAWYER Zoran Markovic (third from the left) is one of the people cited as participants of the meeting in question, but unlike Damir Polancec, the judge has not remanded him to police custodyLAWYER Zoran Markovic (third from the left) is one of the people cited as participants of the meeting in question, but unlike Damir Polancec, the judge has not remanded him to police custodyAND SO THE OTHER MEMBERS of Government were not informed that in the six-member board, consisting of three members appointed by Government and three appointed by MOL, the casting vote in the event of an undecided vote is held by the president of the board, a member from the MOL quota. That is a key detail in the division of management rights because it is on the basis of this, along with a majority on the supervisory board, that MOL has gained control of the other key management body in the company. It was in a very similar fashion that Polancec explained the deal on separating the natural gas operation from INA to his colleagues, saying that it was necessary for security of supply and because INA will, as of 2012 and in line with EU directives, start selling natural gas at market prices. In the process he glossed over the fact that, by assuming the function of general importer of natural gas from INA the state has in fact also assumed about 4 billion kuna of losses that the company would have incurred up to 2012 arising from the regulated price at which it is obliged to sell it. In these circumstances, and given the authority Polancec then had in the cabinet, it comes as no wonder that his report was adopted unanimously.

But, these were official sessions of Government, and it has now been revealed that some members of Government discussed the negotiations with MOL at specially organised meetings outside of the cabinet. Claims have leaked these days from people close to Damir Polancec that, besides Ministers Suker and Matulovic-Dropulic, these meetings were also attended by then Deputy Prime Minister Jadranka Kosor, especially the one held on January 26th of 2009. She was sent to the meeting, says Polancec, by then Prime Minister Ivo Sanader, with the task of making sure there was no bickering between Polancec and Suker at the meeting. The public at large had already known that there were frequent disagreements and verbal altercations between Suker and Polancec, sometimes bordering on incidents. It was for this reason precisely, claims Polancec, that then Prime Minister Sanader had Deputy Prime Minister Jadranka Kosor take part in these meetings on INA to placate Polancec and Suker if they clashed verbally again.

ATTACK IS THE BEST DEFENCE Damir Polancec with his attorney Anto Nobilo - Croatian Government is saying that Sanader is in fact behind Polancec's allegationsATTACK IS THE BEST DEFENCE Damir Polancec with his attorney Anto Nobilo - Croatian Government is saying that Sanader is in fact behind Polancec's allegationsON MONDAY, OCTOBER 11th Nacional reporters asked the Government PR office for the Prime Minister's comment on claims that she had in fact been at one of these meetings in late January. It was quickly thereafter reiterated by Government that Prime Minister Jadranka Kosor continues to insist that she never attended any such meeting, and Minister Marina Matulovic-Dropulic has come to her defence, telling the press that day that Prime Minister Kosor had in fact not been there. "In late 2008 and in early 2009 meetings at the Ministry of the Economy, Labour and Entrepreneurship were attended by Minister Marina Matulovic-Dropulic and Minister Suker. The only topic on the agenda was the purchase of the subterranean natural gas storage facility. Prime Minister Kosor was not present at any of these meetings." Furthermore, from people close to Prime Minister Kosor it could be heard that the story of her participation at these meetings was just another example of media spin on the part of former Prime Minister Sanader, who was out to create further dissention and division between Prime Minister Kosor and the HDZ leadership on the one side, and Polancec on the other, ahead of Sanader's testimony before the parliamentary inquiry.

WHATEVER THE CASE, former Deputy Prime Minister Damir Polancec continues to insist that Jadranka Kosor was present at the meetings in question, and that would, according to sources close to Polancec, soon be confirmed by two neutral witnesses, and perhaps even by Ivo Sanader himself, who allegedly ordered the then deputy prime minister to attend these meetings. On the other hand, Prime Minister Kosor perseveres in her claim that she did not attend them. The solidest evidence from either side would be to make public the minutes of these meetings, as they certainly list all those in attendance.

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