1Privatization235 was the process that had the greatest impact on the citizens. According to Jože Mencinger, privatization is essentially “an arranged and legal transfer of property rights from the ‘people' - the state and other public institutions to persons of civil law - individuals and companies”. Private property was supposed to “improve economic efficiency, ensure justice in the distribution of wealth and prosperity and serve to abolish the one-party system”.236 Indeed, the transformation of the previous ownership system into one that corresponded to a market economy mechanism and aimed at achieving the determined economic, social and political objectives proved to be the greatest problem of transition. That private property is a condition for efficiency is self- evident, as private property rights are the basis for saving, investing, finding new products, optimal use of capacities and risk. However, it is also a fact that the rightful owners who would ensure the efficient use of funds could not be created by decrees and administrative transfer of property rights. It is certainly true that private property and market economy are the foundations of a stable political democracy, yet the political and economic elite saw privatization primarily as an opportunity to rapidly increase their political legitimacy and wealth, “and so the ‘real' privatization was the one whose result was a redistribution of wealth and power that suited them, similarly as the ‘real' privatization is the one that allows foreign investors to buy companies at low prices and make large profits”.237 Privatization was dual in nature. It was important from both economic and political perspectives. Replacing the dominant state ownership and control of the means of production with dispersed and diversified private property was an essential act in the abolition of the previous economic system. The dispersion of economic power also meant the dispersal of political power and the establishment of democratic institutions.238 Privatization involved the “sale of state capital in nationalized industries or other companies to private investors”, with the state losing (or not) its control in them. When the transition actually began, privatization was defined as “any transfer of wealth from the state or the public sector to the private sector”.239 According to Alenka Žnidaršič Kranjc, ownership transformation of companies meant “the transformation of a company with socially-owned capital into a company with known owners on the entire equity capital of the transformed company”.240 The economist Ivan Ribnikar even thinks that the term privatization is inappropriate and prefers to talk about the ownership transformation of companies.241 In addition to all the definitions and explanations, one more thing has to be pointed out, namely the fact that “privatization was a precondition for Slovenia's economic transformation and its integration into Europe”.242 Legally, the privatization of the economy took place in a few steps. First, in the autumn of 1991, two acts were passed: the Housing Privatization Act243 and the Denationalization Act.244 As already mentioned, the Ownership Transformation of Companies Act (ZLPP)245 was adopted only in November 1992. This Act will be the main focus in the continuation of this chapter.
1The aim of the acts on the privatization of housing and denationalization was to clearly define ownership and redress injustices, but the latter, in the form in which they were adopted, often caused new injustices. Regarding the manner of privatization of socially-owned housing, many still feel deprived today, and the same applies to the denationalization process, which has been one of the largest, most expensive and, above all, the longest-running projects since Slovenia's independence. According to some analysts, the acts that were supposed to regulate property relations displayed a complete misunderstanding of the private-law structure of property rights, which regulate the acquisition and use of goods and services in the market economy as its necessary consequence.246
2Prior to 1991, a housing fund existed to which all active residents contributed about six percent of their monthly gross income. Residents benefited from the said fund, as some opted for a loan and others for the acquisition of housing rights to social housing. As most of the apartments were dilapidated, housing right holders often renovated them with their own funds. Some even invested so much money that they could buy a new apartment at the prices of the time. In early October 1991, the Assembly passed a new housing act. It was prepared by the Ministry of Environmental Protection and Urban Planning, headed by Miha Jazbinšek, which is why it is often called the Jazbinšek Act (Jazbinškov zakon).247 The Housing Fund of the Republic of Slovenia, municipal housing funds and non-profit housing organizations were designated for the implementation of national housing programmes, while the Republic of Slovenia, municipalities, companies and the pension fund became the owners of social housing. The Act enabled the sale of apartments to former tenants or holders of housing rights. The distribution of the money collected in this manner was as follows: the sellers of the apartments received 70 percent, while 20 percent of the purchase price went to the Housing Fund of the Republic of Slovenia and 10 percent to the Slovenian Compensation Fund.248 According to the data, there were about 225,000 social housing units, about 113,000 of which were to be included in the sale (municipal, confiscated, undersized, etc. units were excluded).249 The Act determined new rental and property relations and the privatization of socially-owned apartments and apartment buildings. According to the provisions of this Act, the holders of housing rights were offered the opportunity to buy “their” apartments at a favourable price from companies or municipalities whose tenants they had been until then. The basic principle of the privatization of apartments and apartment buildings was the equalization of the right to purchase an apartment for all those citizens who were the holders of housing rights on the day the Housing Act came into force. There was another important condition under the Housing Act, namely that the ten- ant250 had a pre-emption right on the apartment that was leased to them for an indefinite period, if the pre-emption right was not exercised by the co-owner or the municipality in instances determined by the Act.251 Under the Act, the holders of housing rights could transfer the right to purchase to their immediate family member with a special written statement. The spouse of the holder of the housing right or the person with whom the holder lived in a longterm living community, their children or adoptees, parents and adoptive parents and persons whom they were obliged to support by law were considered immediate family members.252 Article 117 of the Housing Act thus stipulated that the right to purchase was held by the holder of the housing right, who had this right upon the implementation of the Act. However, the holder of the housing right was able to transfer this right to a close family member with a written statement.253 To determine the value of the apartments that were privatized, the following was taken into account: the number of points, value of points, usable area of the apartment and the correction factor for the adjustment of the final value of the apartment due to the impact of the apartment. The value of a point was calculated by the Ministry of Environmental Protection and Urban Planning, and the results were published monthly in the Official Gazette of the Republic of Slovenia for two years after the adoption of the Act.254 In practice, issues with scoring often occurred. The problem was mainly the rigid use of the scoring system to determine the value.255 The owners of the apartments had to conclude a purchase agreement no later than 30 days after submitting the request for purchase from the previous holder of the housing right. The latter were entitled to a discount of 30 percent of the value of the apartment, reduced for their own participation and for their own investments, which were reflected in the increased value of the apartment. The buyer had to pay 10 percent of the contract value of the apartment calculated in such a manner within 60 days of concluding the agreement, and the remaining purchase price within 20 years, whereby the monthly instalments had to maintain the value of the same share of the apartment throughout the repayment period or were adjusted to the inflation rate. The Act also provided for a discount if the buyer paid in a lump sum or early. Those holders of housing rights who did not decide to buy the apartment concluded a lease agreement with the owners for an indefinite period (in exceptional cases for a definite period), which they were obliged to do no later than 6 months after the Act entered into force.256 The fundamental dilemma in the process of privatization of socially-owned housing was therefore a fair redistribution of housing wealth. If we wanted to privatize social housing in a fair manner from an economic point of view, we would have to calculate the contributions of individuals, the state, companies and other institutions to the common social housing fund and issue securities for the full value and thus establish a mechanism for the privatization of housing for the correct price, which, according to Aleksander Bajt, would not be impossible, as the necessary data were available.257 Alenka Žnidaršič Kranjc wondered “why the parliament did not opt for economic justice (and efficiency) in privatization of socially-owned housing, but for full socialization of the housing economy through the legalization of housing purchases by the housing right holders for extremely low purchase prices”.258 Among other things, the Housing Act changed the housing relations between workers and companies. Prior to this Act, a worker was granted a housing right, with which the company solved the worker's housing problem, while the apartment was virtually lost to the company. Under the new Act, the company became the owner, while the worker had to pay rent and expenses. With regards to lease agreements, it should be noted that the sustainability of the lease agreement was transferred even after the death of the signatory, namely to the spouse, cohabiting partner or a family member specified in the lease. In the case of divorce, the lease agreement could also be transferred to the (former) spouse upon agreement of the spouses or a court decision. The new Act also brought about changes in the management of apartment buildings. Homeowners had to enter into a management agreement, thus regulating the mutual relations regarding the management of the building and the functional land and ensuring the normal functioning of the building. The decisive role in the management of an apartment building was played by those owners who owned more than 50 percent of the apartments in an individual apartment building. If there were more than 10 apartments and 2 owners in an apartment building, an administrator had to be appointed. The novelty of the Housing Act was, as already mentioned, the Housing Fund of the Republic of Slovenia, whose aim was to finance the national housing programme or promote housing construction, renovation and maintenance of apartments and apartment buildings.259 In the field of real estate, many companies did not legally and formally settle their matters. The disorder was reflected in out-of-date cadastral records in land registers, spatial plans and elsewhere. The transfer of real estate was complicated and time-consuming, and some companies deliberately delayed the transfer of land or the signing of a transfer agreement, as the National Farm Land and Forest Fund Act did not provide for sanctions. One of the reasons for the lengthy processes and exclusion of land by companies were also the unfinished denationalization proceed- ings.260 The provision of the Housing Act was fairly simple and did not present major problems as long as the holder of the housing right was a citizen of the Republic of Slovenia. In the event that the holder was not a citizen of the Republic of Slovenia, the question of the legal nature of the right to purchase arose. The solution to this problem provided an answer to the question of who was allowed to purchase an apartment. Was is the holder of the housing right who was a foreigner, or perhaps their family member who was a Slovenian citizen? Was it impossible to buy an apartment at all in such cases? All of these issues posed major legal dilemmas and problems.261 Before the privatization of social housing, 67 percent of apartments in Slovenia were owned, while after the privatization of apartments, this percentage increased to 88.262 Judging by the numbers, we could conclude that the Housing Act was successful, but this was far from being the case. The so-called Jazbinšek Act divided the holders of housing rights into two groups - the majority, which could buy social housing, and the minority, which did not have the right to purchase. The first group bought the apartments at favourable prices, as, for example, the price for a 114-square-metre apartment in the centre of Ljubljana was approximately 16,000 Deutschmarks at the time.263 The second group did not have the right to purchase, as the Housing Act prohibited the purchase of those apartments that had passed into social ownership through nationalization. A new blow was dealt by the Denationalization Act, which provided for the return of apartments in kind, even if they were occupied by housing right holders. This was a unique case in Europe, as no other former socialist country returned housing occupied by people. Slovenia traded with people despite the advice of the Parliamentary Assembly of the Council of Europe that nationalized property should be returned to its original owners if this was possible without violating the rights of current owners or tenants who acquired or leased the property in good faith and without compromising the progress of democratic reforms; in cases where this was not possible, only material compensation should be granted. Holders of housing rights were thus forced to become regular tenants of individuals for an indefinite period of time.264
3In 1994, the Housing Act was amended to introduce “alternative privatization” of housing. If the tenants who were not able to buy their apartments under the favourable conditions of the Housing Act of 1991 decided to buy the apartment in which they lived (in agreement with the owner) or decided to buy another apartment or build a house, they were entitled to “alternative privatization”. This meant that the state provided them with part of the funds to buy or build. They were entitled to compensation in the amount of 36 percent of the value of the apartment in cash and 25 percent of the value of the apartment in the bonds of the Slovenian Restitution Company. Under the Housing Act of 2003, they were entitled to a further 13 percent of the value of the apartment, which they received in cash and no longer in securities. The tenants were thus entitled to 74 percent compensation from the value of the apartment and were able to continue to claim “alternative privatization” within five years of the final decision on denationalization.265 According to Urša Matos, only 1,700 tenants opted for the two models, i.e. either an agreement with the owner to buy the apartment or to move out. Most owners were not interested in selling the apartments at below-market prices, while the tenants did not want to leave the apartments for an extremely low compensation offered by the state, as they would only get around 15,000 Deutschmarks for 100 square meters. The Act guaranteed them the right to a favourable loan in the event of leaving the apartment, but most of the tenants were over 70 years of age and preferred to stay in the rented apartment. There was also a problem in the area of rent payment, as some landlords set it up to ten times higher than allowed by law, while others rejected it to get an argument for a lawsuit.266 The new Housing Act (SZ-1)267 in mid-2003 tried to correct the irregularities. It was drafted at the Ministry of the Environment, Spatial Planning and Energy, which was then headed by Janez Kopač. One of the most important novelties of the Act was the obligation of apartment owners to pay monthly contributions into the reserve fund managed by the administrator. The Act also provided for the construction and sale of new apartments, protection of the buyer in the sale of new apartments, competencies and tasks of municipalities and the state in the field of housing, the establishment of the housing chamber, the state housing council, etc.268 The Association of Tenants of Slovenia, which was founded in 1991, was pointing at the injustices throughout the 1990s and even later on. For the most part they were unsuccessful, which was also confirmed by the aforementioned new Housing Act (SZ-1), which caused further unfairness and confusion. In 2003, in the article published in the newspaper Mladina entitled “Victims of Transition” (“Žrtve tranzicije”), Urša Matos described the fate of an unfortunate family of four who lived in a 90-square-metre apartment in the old part of Ljubljana for three generations. After denationalization, the owners sold the house and the family was forced to move out. In return, the owner offered them only a two-room apartment in Žužemberk, with which they did not agree. The next offer was a two-bedroom dark apartment under the Ljubljana Castle, without a bathroom and with a toilet in the common hallway. After severe pressure, they decided to find an apartment on the open market and buy it. The funds they invested in the renovation of the original home were not reimbursed, they had to pay for the relocation themselves, and the owner charged 100 Deutschmarks per day after the date by which they had to move out. The new Act provided a solution for tenants who wanted to avoid similar situations: in the event of arbitrary eviction from the apartment, they were entitled to compensation, which was, of course, again extremely low.269
4A few words about the Housing Fund of the Republic of Slovenia. As the economist Stanislav Kovač wrote in his book, the Fund was supposed to help solve the distress of the housing seekers. The task of the Fund's leadership was to distribute the money raised through the sale of social housing among housing seekers in the form of soft loans. In reality, the Fund began to turn over part of the funds on the financial market, lending them to the economy, banks, public companies, etc. (in 1993, the Fund supposedly lent the economy as much as 828 million Slovenian tolars of financial surpluses from housing purchases and illegal construction). It was with this borrowed money that the Fund enabled numerous companies to conduct business with it for a few days, either on the stock exchange or by lending it at a higher interest rate, thus earning large profits with public money.270 The story ended without an epilogue. The Parliamentary Committee did order a criminal investigation, which ended without detecting any signs of crime. The fact is, unfortunately, that the described case is nothing of the ordinary, as many other scandals ended in a similar way (without a court epilogue or criminal prosecution at all).271 The following quote rather vividly describes not only the mentioned cases, but the attitude of citizens towards the legislation and legal system in general: “Many Slovenians wanted a state with a soul; today they believe that we do not even have a state governed by the rule of law.”272
5Enormous friction was also caused by the Denationalization Act. As an introduction to the subsequent denationalization, the Assembly of the Republic of Slovenia adopted the Temporary Prohibition of Felling in Socially Owned Forests and Temporary Prohibition of Trade in Socially Owned Real Estate Act273 on 2 July 1990, which stipulated that, in order to protect the rights of the previous owners of agricultural land and forests, logging in those forests and trade in agricultural land and socially-owned forests be prohibited until 31 December 1990.274 In the following years, the legislation, which was inconsistent with regulations and institutes of denationalization, or, better said, incorrectly understood in practice, had a negative impact on the field of forest management. According to the Denationalization Act, the return of forests was obstructed by the legal successors of forest holdings (which eventually became privately owned companies), while the compensation for non-use was supposed to be paid by the fund as an entity liable for the return. The legal successors of forest holdings also demanded a return of investments, although it is known that forest roads were also built with the funds of self-governing interest communities, municipalities and the state. Following the adoption of the Denationalization Act, responses varied. The expropriated were rejoicing and saying: “It was a great day for us.” Others “neither applauded nor cursed.” There were about 200,000 expropriated owners and about 60,000 denationalization proceedings. Calculations showed that denationalization would privatize about a tenth of socially-owned property.275
6Demos strongly supported denationalization, that is, returning the property nationalized after the Second World War in various ways and on the basis of various legal provisions. Due to the efforts to return the property to the expropriated owners or their heirs “in kind”, the method of privatization and denationalization was the seed for the disintegration of Demos. The ambitions of the Prime Minister Lojze Peterle and the method of ownership transformation were particularly criticised by the Slovenian Democratic Union. The Denationalization Act divided the assembly into two blocs, the Demos bloc and the opposition bloc. The opposition MPs warned that redressing the injustices caused by expropriations after the Second World War would lead to new injustices through denationalization. In the first debate, 170 amendments were submitted to the legislative proposal on denationalization. At the time of the adoption of this Act, the “Demos voting machine” was still functioning in the assembly, resulting in the adoption of the Act on 20 November 1991. The Act legalized the return of property that had been nationalized after the Second World War under the Agrarian Reform Act, the Nationalization Act and the Confiscation Act. The property was returned to the former owners or their heirs “in kind”, and if this was not possible, with compensation. However, the return of property “in kind” caused a lot of hot blood already upon the passing of the Act, and later even more in practice. Although the proponents argued that the Act and its implementation would not cause problems and injustices to people who had at their disposal the property intended for denationalization, such as the apartments in which they had lived for numerous years or the land they had obtained from the land fund of the agrarian reform.276 The Demos government therefore decided that its priority in redressing the injustices would be to return the property to the injured parties in kind. It is interesting that none of the other transition countries decided to do so, as they mostly intervened in the form of payment of monetary compensation, mainly because activities of public interest (schools, libraries, etc.) frequently took place on nationalized land and buildings.277 Given that real estate prices were rising on a yearly basis since the adoption of the Act, it is clear that Slovenia opted for an extremely generous move in favour of denationalization beneficiaries. The Demos government was criticized by many for choosing to favour the return of property in kind primarily due to its close ties to the Roman Catholic Church (RCC). In fact, the RCC was the largest denationalization beneficiary. By the end of October 2007, the RCC had been granted claims totalling € 209 million, which means that it had been 96.9% successful thus far: out of 1,191 claims for the return of agricultural land, forests, housing units, business premises and building land, 1,006 were completed.278 The request of the Archdiocese of Ljubljana for the return of the Savica Waterfall, part of the shore of Lake Bohinj and the area of the Triglav Lakes Valley still resonates today.
7According to Aleksander Bajt, both the Housing and Denationalization Acts displayed a deep misunderstanding of the essence and structure of private law property rights, which regulated the acquisition and use of goods and services in a market economy as their economic successor. Moreover, Bajt described the Denationalization Act as decidedly unconstitutional in its very concept and not only in its individual provisions.279 Either way, the fundamental principle adopted was the return of nationalized property in kind. When the return in kind was not possible, the beneficiaries were compensated in the form of replacement property or in bonds of the Slovenian Compensation Fund.280 Article 16/1 was particularly controversial, which simply assumed that the size of the property was something obvious, indisputable. Among other things, the Denationalization Act “did not take into account non-property rights and the market value of property”.281 The Denationalization Act provided for the completion of procedures for the return of nationalized property within one year. This prediction was more than optimistic and unrealistic, as the administrative authorities and, to a lesser extent, the courts (according to the division of competences into the predominant administrative competence) were to return the property transferred first to the state and then to the social property on the basis of 29 regulations under the Denationalization Act and also in relation to other regulations within one year after the submission of complete claims. In the process of adopting the Act, the legislator certainly did not sufficiently confront the different interests of the beneficiaries of denationalization and the liable parties for the return of nationalized property or the groups interested in denationalization and the ones that were negatively affected by it. These conflicting interests were thus confronted only later, when the holders of different interests organized and began to persistently and relentlessly assert their interests: on the one hand, the beneficiaries of denationalization and on the other hand, the liable parties - in that time still social legal entities - and especially the tenants of the apartments in denationalized apartment buildings, who could not buy their apartments as holders of housing rights in social housing, as well as tenants of business premises. The interest groups also repeatedly proposed amendments to the legislation. During the implementation of the Denationalization Act, a number of amendments were made, and the Constitutional Court, by its decisions or by repealing two individual provisions of the Denationalization Act, essentially created a situation where the amendment was necessary or it significantly influenced the substantive decision-making of competent bodies in the denationalization proceedings. Under the Denationalization Act, the beneficiaries of the return of property were all those who were Yugoslav citizens at the time when their property was nationalized and whose citizenship282 was recognised by law or an international treaty after 9 May 1945. If the property was nationalized as a result of the cessation of citizenship by deprivation, it was considered to had been nationalized to a Yugoslav citizen. Persons who had permanent residence in the territory of the present-day Republic of Slovenia and whose Yugoslav citizenship was recognized after 15 September 1947 by law or an international treaty were also considered beneficiaries. If the beneficiaries of denationalization were deceased or declared deceased, their legal heirs were entitled to exercise the rights under this Act. The beneficiaries of the return of the property of personal and capital companies were shareholders or partners. The right of return of the property was also granted to churches and other religious communities that operated in the territory of the Republic of Slovenia when the Act came into force.283 Since its entry into force on 7 December 1991, in parallel with other legislation, the Denationalization Act underwent a number of interventions, amendments and additions to it, of which particularly the temporary suspension of the implementation of certain provisions of the Act, the process of ownership transformation, the establishment of the Slovenian Compensation Fund, the Agricultural Land and Forests Fund of the Republic of Slovenia, the development of local self-government and the process of integration into the European Union significantly influenced the dynamics of the denationalisation process. When the Denationalization Act was adopted as a legal basis for the return of previously nationalized property to former owners, it was not possible to foresee all the issues that actually accompanied the implementation of the denationalization process. It was initially believed that the process would be completed in one year, but the deadlines were extended multiple times. The Constitutional Court of the Republic of Slovenia, which was often asked by the National Assembly of the Republic of Slovenia to extend the deadlines, also warned that the process should be carried out faster. One of the requests for the extension of the deadline, submitted in April 1997, cited differing views and perspectives on amending the Denationalization Act, a call for a legislative referendum under the motto “Let's Preserve Our Wealth” and difficulties in forming a government. The Constitutional Court extended the deadline, but in doing so it drew special attention to some areas that had to be regulated by the legislator. The Constitutional Court emphasized the issue of returning large estates of feudal origin284 and called on the legislator to settle this issue within the postponement period, as upon the expiration of the deadline, the denationalization proceedings in which individual beneficiaries demand the return of more than 200 ha of agricultural land and forests would have to continue and the return ban on the extent of the land claimed would no longer exist. This would also mean that there would no longer be any obstacles to the possible return of large estates of feudal origin if the beneficiary also met other legal conditions for return.285
8Denationalization proceedings have been objectively the most difficult proceedings for administrative units so far, as they contained elements that are more similar in their content to civil litigation. The Denationalization Act encroached on several areas of work. Administrative units in the first instance decided on the requests related to the return of agricultural land, forests and agricultural holdings, apartment buildings, apartments, office buildings, business premises and building land. Appeals against decisions of administrative units were decided in the second instance by the competent ministries according to the area of work in which the specific case belonged. The Ministry of Finance decided in the first instance on the requests for the denationalization of the property of banks, insurance companies and other financial organizations nationalized in accordance with the regulations referred to in Articles 3 and 4 of the Denationalization Act. The Ministry of Culture decided in the first instance on the denationalization of property protected under the regulations on the protection of cultural heritage. The Ministry responsible for the environment and space decided in the first instance on the denationalisation of property protected under nature conservation regulations. In accordance with the Denationalisation Act, in addition to administrative bodies, denationalisation claims were also decided by district courts in non-contentious proceedings in cases when the property passed from private into state ownership on the basis of a legal transaction concluded due to threat, force or deceit by a state body or a representative of the authorities. By 30 June 2001, a total of 38,414 requests had been filed with administrative bodies, ministries in the first instance and the courts. The number of decisions issued by administrative bodies, ministries in the first instance and courts totalled 38,823, granting requests in 23,981 cases, partially granting them in 1,891 cases, dismissing requests in 7,410 cases, rejecting them in 3,172 cases, while in 2,366 cases the proceedings were stayed. Of the 38,823 decisions issued, 34,902 were final. The number of decisions issued by administrative bodies and ministries in the first instance totalled 37,074, granting the requests in 23,618 cases, partially granting them in 1,891 cases, dismissing them in 7,095 cases, rejecting them in 2,466 cases, while in 2,001 cases the proceedings were stayed. Of the 37,074 decisions issued, 3,540 were final. 5,750 appeals were filed against the decisions issued in the first instance, and 603 appeals were filed with the courts (a total of 6,353 appeals). There were a total of 23,224 cases closed with administrative bodies and ministries in the first instance and 1,749 with the courts, amounting to a total of 24,973 closed cases. Of these, 20,917 or 1,362 cases were final, thus a total of 22,279 cases. In the period from the enactment of the Denationalization Act to the end of June 2001, a total of 35,880 requests were filed with administrative bodies and competent ministries deciding on cases in the first instance, of which 23,224 cases were fully closed or resolved, which accounted for 65 percent in the relative share of the overall structure of filed requests. By this time, 35 percent of cases remained unresolved.286 Denationalization was also one of the biggest inhibitory moments in the process of ownership transformation. In cases where the denationalization process had not yet been completed, the denationalization beneficiaries often objected to the ownership transformation of companies in advance, but this was not a sufficient argument for the ownership transformation. The latter was a time-limited process tied to several legal deadlines. The Act therefore allowed a company to temporarily reserve the property and proceed with the ownership transformation.287 In the process of ownership transformation, 95 companies transferred part of the social capital in the form of shares or stakes in the amount of 9.13 billion Slovenian tolars to the Slovenian Development Corporation as a reservation for denationalization beneficiaries. The basis for the transfer of these shares to the Development Corporation was a final interim injunction. The Slovenian Development Corporation concluded agreements with denationalization beneficiaries on the transfer of shares or stakes. In some cases, the value of the reservation for return was too high with regards to the final decision and part of the shares became the property of the Development Corporation.288
9The implementation of denationalization was frequently the subject of controversy and various accusations, mainly by expropriated parties, organized in the Slovenian Association of Owners of Expropriated Property (Združenje lastnikov razlaščenega premoženja Slovenije - ZLRP). According to the expropriated, the return of nationalized property was too slow. They constantly reminded the Government of the Republic of Slovenia as well as the relevant institutions of the European Community of this. On 12 December 2003, a “Public Debate on Unfinished Denationalization” took place in Ljubljana, where the expropriated unanimously determined that the state's attitude towards expropriated parties was irresponsible and that the state adopted various amendments to the Denationalization Act with a tendency to delay the return of property or to return it to as few expropriated persons as possible. The culmination of such efforts was seen by the expropriated parties in 1998, when the Act Amending the Denationalization Act289 or the “Bavčar Act”, as it was called, was adopted, which, in their opinion, significantly changed the conditions for return to the detriment of expropriated persons after seven years of validity of the original Act.290 “The Denationalization Act repaired the injustices suffered by one group of people and caused new injustices to tenants. We hoped that the Parliament would now grant certain amendments, but the parliamentary majority chose to ignore them. I do not understand why one should be given everything and the other nothing”, Tanja Šarec, the president of the tenants' association, said in 2008.291 The Office of the Ombudsman of the Republic of Slovenia also mentioned in its annual reports that the return of property to the expropriated was too slow. In the annual report for 2001, they thus wrote: “The Association of Owners of Expropriated Property warns of the inadmissibility of amending the Denationalization Act during its implementation, about the deterioration of the position of owners due to some other acts, unjustified restriction of property of some beneficiaries (owners of denationalized apartments, business premises and forests), the fact that the state has not yet taken over the guarantee for bonds received by the owners for the property not returned in kind, a change in the return of building land taken from the owners' use after 1963, moral disqualification of beneficiaries, controversial determination of citizenship of some beneficiaries, other misconduct of administrative and judicial bodies and non-transparency of government reports on the implementation of the Act, expressing a desire or calling on international institutions to establish direct control over the implementation of denationalization”.292 The length of the proceedings was also the result of frequent substantive disagreements with the legislative solutions. Already at the time of the enactment of the Act, some pointed out that its main shortcoming was that it did not sufficiently connect denationalization with ownership transformation. These disagreements regarding the content led to the fact that administrative bodies and courts (the Administrative Court of the Republic of Slovenia and the Supreme Court of the Republic of Slovenia in administrative dispute293) often adopted positions that were not in favour of denationalization. The press release referring to the resolutions adopted by the Government of the Republic of Slovenia at its 63rd session on 2 March 2006 and issued by the Government Communication Office read: “At today's session, the Government of the Republic of Slovenia got acquainted with the course of resolving denationalization in the Republic of Slovenia and adopted resolutions to speed up denationalization proceedings.” In order to speed up the resolution of denationalisation claims, the government adopted the following decision: “The Government of the Republic of Slovenia imposes on all participating bodies (administrative units, ministries dealing with denationalization proceedings in the first and second instances, the Surveying and Mapping Authority of the Republic of Slovenia, the Agricultural Land and Forest Fund of the Republic of Slovenia, the State Attorney's Office, the Slovenian Compensation Company) to speed up the work on denationalization and to address denationalization proceedings as a matter of priority.” This communication confirms the fact that the denationalization process was too slow and that it dragged on for a long time after the formal completion of transition.294 This was also evidenced by an interview in July 2007 with the then Minister of Justice. With regards to the state of denationalization, Lovro Šturm answered that on 31 March 2007, 94.9 percent of denationalization cases had been finalized since the enactment of the Denationalization Act, while 1,105 claims remained unresolved at administrative units.295 According to the Minister, in accordance with the Denationalization Act, in addition to administrative units, district courts also decided on denationalization claims in non-contentious proceedings in those cases when the property passed into state ownership on the basis of a legal transaction concluded due to threat, force or deceit by a state body or a representative of the authorities, as provided for in Article 5 of the Denationalization Act. Šturm also stated that a total of 2,804 cases had been filed with the district courts since the Act came into force on 30 September 2006. 2,334 cases had already been finalized, which represented a 92.3% share of the submitted claims. 147 cases remained unresolved in the district courts, and non- contentious proceedings on the return of property confiscated by a criminal conviction were decided on the basis of the Enforcement of Criminal Sanctions Act. “All our activities are aimed at completing the denationalization as soon as possible”, Šturm added.296 The government led by Janez Janša in the period 2004-2008 made special efforts to complete the denationalization process as soon as possible. Thus, at its 36th regular session on 26 February 2008, the National Assembly of the Republic of Slovenia adopted a new Act on the Completion of Proceedings for the Return of Nationalized Property,297 but the National Council of the Republic of Slovenia imposed a suspensive veto on the Act in early March 2008. The national councillors were convinced that the Act would “force decision-makers to make quick and therefore poor-quality decisions”. In their opinion, the Act would create new rights, expand the circle of beneficiaries from abroad and introduce new legal means for extraordinary renewal of already completed proceedings.298 Following the veto, the SDS (Slovenian Democratic Party), NSi (New Slovenia - Christian Democrats) and SLS (Slovenian People's Party) expressed disagreement with the councillors, while the then opposition parties and DeSUS (Democratic Party of Pensioners of Slovenia) welcomed the veto.
10In addition to personal injustices, the prolonged proceedings caused damage to the economy itself. The material damage occurred for several reasons. The property that was the subject of denationalization proceedings was not properly managed by anyone. It was not maintained as it should have been. Even in economic sense, the real estate could not be used for its economic purpose (for example, to carry out an economic activity), as it was not allowed to be modernized. Legal transactions with this real estate were also not possible, as they were explicitly prohibited by Article 88 of the Denationalization Act. Furthermore, in order to accelerate denationalization, the case law prevailed recognizing compensation to the denationalization beneficiaries for the inability to use nationalized property from the enactment of the Denationalization Act to the final return of nationalized property. Another legal and political issue is worth pointing out, namely when the property of the former companies was being returned, as well as in cases of forest return procedures, the liable parties or forest tenants tried to prove a conflict of interests between the individual interests of denationalization beneficiaries and the public interest of providing conditions for the operation of companies that employ and give bread to many workers. In reality, it was a conflict with the interests of the new owners of companies, who wanted to keep as much property as possible, the return of which was demanded by the beneficiaries of denationalization, and they tried to shift the burden of compensation for unreturned property in kind to the Compensation Fund and therefore to the entire society.299
1The contradictions between the supporters of “shock therapy” and the proponents of gradualism came to the fore precisely on the issue of ownership transformation or privatization of companies. Discussions on privatization between the two concepts - the concept of gradual, decentralized and repayable privatization and the concept of rapid, centralized and distributive privatization - led to delays in the adoption of privatization legislation. The debate on the method of privatization virtually “blocked” the operation of the assembly. Demos' proposal was opposed by a group from the Slovenian Democratic Union (Slovenska demokratična zveza). In addition to the government proposal, the Chamber of Associated Labour (Zbor združenega dela) also submitted the proposal by the MP from the Party of Democratic Renewal (Stranka demokratične prenove) and the president of the “shadow government” Emil Milan Pintar as well as Mencinger's bill on privatization. Peterle described the move as “a disservice to the detriment of Slovenia”, but he later had to defend himself before the Chamber of Associated Labour because of this statement. In the end, the Assembly, in which Demos did not have a majority, did not accept any of the proposals, and the complications in the Chamber of Associated Labour continued and “blocked” the work of the Assembly to a great extent.300 The Deputy Prime Minister, Jože Mencinger, responsible for the economy in the Demos government, set the transformation of the economy from a socialist to a capitalist one as well as privatization in a rather social and economical manner. He believed that privatization should not be an end in itself and that it should not be understood merely as a political act, but that the economy should become more efficient with its help. According to him, the burden of the transition from one economic system to the other should be borne by the wealthier. However, many members of Demos did not agree with this. Mencinger therefore submitted the first proposal for a privatization model to the Assembly in June 1990. Based on this proposal, a company would be run by those who would buy a tenth of its value, while at the same time Mencinger opposed the free distribution of property. He continued to entrust the management of the companies to the then directors, which led to criticism, especially in the ranks of Demos, for protecting the so-called “red directors” and for not showing enough enthusiasm over independence with his views on the economic part of transition and gaining independence.301 The Slovenian government adopted the draft of the Privatization of Companies Act on 18 October 1990. According to the then government, the Privatization of Companies Act was to enable the transition from social property owned by “everyone and no one” to ownership forms known by modern market economies, in ways that would prevent the collapse of companies and limit the “sale” of common property of the Slovenian citizens.302 In January 1991, the Act was slightly amended by the so-called Mencinger group, but its fundamental emphases remained. The draft was called Mencinger's model of employee or management buyout. Its essence was that the holders of privatization in companies were the employees and individuals in leading management positions. It was left to them to choose the most favourable way of privatization. Mencinger's model envisaged four forms of transformation: the sale of a company or its part to domestic or foreign buyers at a real market price, but with a certain discount for employees, recapitalization or investment of additional capital in the company, conversion of receivables into capital shares and transfer of shares to funds. On 19 March 1991, upon the presentation of the bill to the assembly, Mencinger pointed out that nationalization would not be entirely avoidable because there was not enough money in private ownership. In addition, large companies existed that no one would want to buy.303 Prime Minister Lojze Peterle did not agree with Mencinger, believing that the economy would thus remain in the hands of former, so-called communist directors or managers. Peterle was therefore looking for another way of privatization, especially one that would remove the previous directors. According to him, privatization was a way to eliminate the so-called directorial socialism, which was introduced by Markovič with the reform of companies and according to which many individuals established companies without the necessary capital to operate them and often became directors to themselves.304 Relations deteriorated even further when the government hired an American economist, Harvard professor Jeffrey Sachs, to act as an economic adviser, who became involved in drafting privatization legislation in March 1991. Among other things, he was also an advisor to Ante Markovič. As a result, relations in the coalition deteriorated, while Deputy Prime Minister Jože Mencinger and Finance Minister Marko Kranjec even resigned. The coalition was facing a clash of two completely different economic and political concepts, on the outside embodied by Mencinger and Sachs.305 The latter came into contact with the Slovenian government with Janez Drnovšek's intervention at the end of 1990. In fact, Sachs was keen to prove the success of his model in at least one country, as he experienced failures in other post-socialist countries. As a small and relatively developed country, Slovenia was much more manageable and therefore suitable for the “experiment”. Sachs' team even waived the fee, but his work nevertheless cost the Slovenian government several hundred thousand dollars.306 The essence of the dispute between the two different concepts was that the first side saw the fundamental problem of the Slovenian economy in the macroeconomic field, gave priority to the gradual transformation of the economic system, opposed the immediate introduction of Slovenian currency and the break-up of the Ljubljanska banka bank. The other side, which was not burdened by the mortgage of the Yugoslav economic system, proposed a rapid leap into capitalism with the simultaneous implementation of the most important economic measures, namely the change of currency, economic reconstruction, banking system rehabilitation, privatization and financial recovery of companies. This side saw the fundamental problem in socially- owned companies and was in favour of the break-up of the Ljubljanska banka bank. Sachs, together with another foreign economic expert, David Lipton, drafted a programme of economic independence and restructuring of the Slovenian economy for the government. The authors advocated two manners of privatization: in smaller companies, about 60 percent of social property would pass into the ownership of one owner or a smaller group of owners, while about 40 percent would be owned by the state, which could sell that share after privatization was concluded. Large companies were to be transformed through investment funds, and in the case of denationalization, the authors advised against the return in kind. The preparation of a new privatization proposal was taken over by a group at the Republic Secretariat for Social Planning under the leadership of Minister Igor Umek.307 In the end, after a number of compromises and amendments to the Act, a sort of intermediate model between Mencinger's and Sachs's prevailed in privatization. Partly because Sachs' idea of an immediate instead of gradual privatization could not be realized and because the process of gaining independence could not be carried out according to the imagined ideal model.308 The government was severely criticized: it was accused of subordinating the process of gaining independence to political interests and of neglecting the domestic experts. The most direct and unforgiving critics were the leading Slovenian economists. Alexander Bajt resented the government for engaging in “painstaking processes of imposing privatization and denationalization” instead of overcoming the problems in capital management and its formation. In his opinion, this proved that the government considered private ownership to be the most important factor of production, thus “fooling itself and trying to prove to the world how advanced and radical it is”, while at the same “wilfully burying its head in the sand” with regards to the problems the solution of which was much more important for the efficiency of management. A younger generation of economic experts, such as Ivan Ribnikar, reproached the government of continuing to neglect the domestic experts. According to him, the previous government attracted second- and third-class economists as well as “self-taught” economists who “were experts in everything” and explained “something that could not be understood”, while the new government recruited foreign economists who were selling and “telling things” to Ljubljana and Belgrade that could be found in the textbook for the first year of the Faculty of Economics in Ljubljana.309 Some argued that the strong politicization of the ownership transformation issue was the consequence of two factors: the first was the lack of coordination in the government in drafting its first privatization proposal, which the government even withdrew by itself, while the second factor was the fact that the transition to the new system was sought to be implemented by using the framework of the old system.310 The acts pertaining to companies and socially-owned capital adopted by the last Yugoslav government thus enabled spontaneous privatization. After winning the elections, the Slovenian political opposition temporarily suspended the ownership transformation under this legislation with a constitutional law. The first government proposal envisaged decentralized privatization on the grounds that the existing managers were capable of successfully running the companies. The more politically conservative and anti-communist part of the government did not agree with the proposal, which resulted in a split and a new proposal, which provided for centralized privatization with certificates. The adoption of this proposal was prevented by the Chamber of Associated Labour, in which the representatives of the companies had a majority. In the end, a group of MPs from all parties reached a compromise, which, through employee discounts, enabled the dominance of internal owners and at the same time assigned an important role to investment funds.311
2Jože Mencinger's perspective on the disputes over privatization and on the first Prime Minister Peterle is interesting. In an interview with the newspaper Mladina in 2006, he said: “When I resigned because of the conflicts connected to privatization, I was angry with him, but now I look at things differently. By resigning, I did the only thing possible. I could not start claiming that something was green, if I believed it was blue, and the times were not right for quarrels. Everything that could be done for independence at the macroeconomic level was done by April, mostly thanks to Marko Kranjec, and in operational matters, my successor Ocvirk was much better. Otherwise, I have good memories of the government at the time, which Peterle led very democratically. We were a group of political amateurs trying to do something without knowing exactly what and how, and we were completely independent of the parties. For example, I was a member of the current Janša's party, which was Tomšič's party at the time, but it never occurred to me to ask anyone in the party what to do. However, it is true that the parties did not know exactly what to do with the authority either.”312 With the planned rapid privatization of the Slovenian economy, a number of concerns arose, even when privatization in certain segments had already begun. All this was due to the fact that the government or parliament did not formulate the concept of privatization in time. “The most fatal mistake had been made before gaining independence, namely the abandonment of the concept of decentralized, gradual, repayable and controlled privatization, which took into account the state and characteristics of the Slovenian economy. With it, we would maintain the advantages, carry out privatization and re-privatization without turmoil and quickly find responsible owners despite the lack of capital. Without the foolish attempt to replace this concept with centralized and distributive privatization, the situation in the Slovenian economy would be much better than it is now, regardless of this or that economic policy”, Mencinger said in mid-1993.313 Controversy and problems over the adopted privatization legislation continued even after the adoption of the Act. As pointed out in an interview in September 1993, the then director of the Agency of the Republic of Slovenia for Privatization and Restructuring, Mira Puc, saw the biggest problem that was hindering the course of privatization in “the constant desire to amend the Act, which has an inhibitory effect on the implementation of privatization”.314
3In addition to the above-mentioned privatization proposals, other proposals also sprung up that were not taken seriously or were not the subject of government decision-making at all. Even before deciding on which type of privatization to use, Aleksander Bajt also spoke out. He proposed the establishment of such a system, according to which a wide variety of companies would compete on the market - from state, private, shareholder and self-governing companies. The market would then show what sort of companies would thrive best. This proposal, of course, fell on deaf ears.315 Bajt's opinion was clear with regards to privatization. “Slovenian economic policy has become entangled in painful processes of forced privatization and denationalization”, he said in September 1991. He argued that “the form of ownership is not the most important thing for production, as it is possible to produce also without private property” and that it would be much more useful if, instead of becoming exhausted by ownership transformation, “social companies became completely independent and be left to themselves, to workers and managers”. “If they will need owners, they will get them and get rid of the managers if they will not be capable. This will encourage the development of entrepreneurial and managerial skills. On the contrary, the intended nationalization of companies will push management and thus the efficiency well below the current level”, Bajt added, who also wondered “if we should extend the long-standing system of redistribution to capital as well”. If this were to happen, after resale, we would “get financial capitalists, speculators at best not entrepreneurs; we need the latter the most, however”.316 The economist Ivan Ribnikar also seriously considered how to carry out the privatization of companies. He defended the thesis that the state should not distribute the property, as savings and investments can only be increased by saving and creating new value.317 Ribnikar's proposal aimed primarily at ensuring an increase in the equity capital of companies, the emergence of a capital market and a sufficiently rapid takeover of control in companies by the rightful owners. A new owner of socially-owned property should not be considered dangerous to take control of the company, but should be similar to the owners of companies known to market economies and should be aware that socially-owned property belongs to all citizens and take into account national economic goals.318 Ribnikar believed the Pension Fund to be such an owner. In his opinion, socially-owned property should therefore be transferred to the Pension Fund, which would ensure the stability of the pension system in the long run. The adopted Ownership Transformation of Companies Act (ZLPP) was very different from Ribnikar's proposal. Only 10 percent of socially-owned property was transferred to the Capital Fund for Pension and Disability Insurance (Ribnikar suggested that all property be transferred to it) and a large part of the property was distributed among citizens through ownership certificates, which Ribnikar also opposed. He also came forward with the proposal at the end of the ownership transformation process, when two problems emerged. The authorized investment companies (PIDs), in which the majority of the certificates were invested, could not exchange them for real assets. The so-called problem of investment gap arose. On the other hand, the reform of the pension system was becoming increasingly urgent. Ribnikar tried to connect the resolution of both issues. His proposal was to transfer the property in the hands of the authorized investment companies to the newly established pension fund, which would be part of the second pension pillar. The owners of the transferred property (shareholders of the authorized investment companies) would be entitled to receive a pension annuity after a certain period. The state would then allocate additional property to the pension fund, which would correspond to the value of the certificates that had not yet been exchanged. Subsequently, another pension fund would be set up to collect supplementary insurance premiums, on the basis of which the policyholders would be entitled to a supplementary pension. Unlike the first fund, this one would not have initial assets, but would grow only on the basis of current payments by the policyholders.319 In conclusion, we can say that Ribnikar's privatization proposal fell on deaf ears in the early 1990s. The proposal, according to which the masses would not get their hands on anything tangible, was in fact not to the liking of politicians or the general public. The second proposal at the end of the ownership transformation was only partially taken into account in the First Pension Fund of the Republic of Slovenia and Transformation of Authorized Investment Corporations Act.320 The greatest departure from Ribnikar's proposal was transferring property from authorized investment companies to the First Pension Fund. Ribnikar proposed that all or at least most of the property, both real and certificates, be transferred to it, but the Act only provided for the possibility of transferring the certificates. This, of course, greatly reduced the Fund's assets.
1The Ownership Transformation of Companies Act was adopted by the National Assembly of the Republic of Slovenia as late as 11 November 1992, after more than two years of coordination and after numerous discussions at professional, political, theoretical and other levels.321 The Act represented a compromise between different professional concepts and political interests, and it was adopted on the basis of an amended bill by a special committee of three MPs, Janko Deželak, Emil Milan Pintar and Mile Šetinc, whose task was to draft a compromise proposal between different political interests in the most economically and socially acceptable way possible.322 The Act provided for three basic procedures: nationalization (agricultural land and forests used by socially- owned companies), restitution or return to the original state and privatization. Restitution could be realized in three ways, namely in kind, with compensation through the Compensation Fund and in the form of capital shares in companies. The Act provided that claims for property restitution filed by the injured parties with the municipal administrative units be resolved individually.323 The Ownership Transformation of Companies Act also determined the share of socially-owned property or capital that companies had to transfer to a fund and granted citizens the so-called ownership certificates based on their age, which were issued to their name, were non-transferable and could be exchanged for shares in privatized companies.324 The adopted Act was intended to improve what was most criticized in the first two proposals as successfully as possible. It thus sought to prevent “wild privatizations” by company managers and excessive state ownership, which the state could achieve through the privatization fund or through state investment funds. The Act also designated a greater role to employees and other citizens in the privatization process.325 The said Act was, in fact, a logical continuation of the economic reform started in 1988, which was prepared by the “Mikulič Commission”. At that time, it was not yet clear that this was not one of the classic reforms of the socialist economy, which was supposed to increase its efficiency without changing its socialist nature. It was only when the reformers “began to talk about the capital and labour market and socially-owned property that it became clear that there was much more to it”.326 The main objective of the Ownership Transformation of Companies Act was to transform all socially-owned companies into companies with well- defined ownership rights in the form of joint-stock companies and limited liability companies. The Act combined elements of two different approaches:
2The first condition for the ownership transformation of a company was the preparation of the opening balance sheet of the existing socially-owned company and determination of the nominal value of shares and their number, while adjusting the previous bookkeeping to contemporary international standards. The programme submitted by a company had to include organizational and financial restructuring plans before privatization, selected transformation methods or their combinations, and the proposed privatization methods. The Ownership Transformation of Companies Act provided for seven methods, which were a combination of free distribution and commercial privatization methods:
3If we simplify the above-mentioned, the basic model of privatization under the Ownership Transformation of Companies Act provided for a system of “20% + 20% + 20% + 40%”, which meant that 20 percent of shares were transferred to the parastatal pension and compensation funds, 20 percent to authorized investment companies (the latter had to be privately owned328), which collected the ownership certificates from citizens by themselves, 20% were exchanged under favourable conditions for ownership certificates of internal owners (managers, employees and former employees), while 40% could alternatively be used for the buyout by internal owners under favourable conditions, for exchange with ownership certificates of citizens through public sale of shares, for exchange with ownership certificates collected in authorized investment companies or for a buyout by strategic partners.329 Before the start of privatization, the value of each individual company had to be assessed. This was performed by appraisers working within a special commission. “Our commission is frequently accused of not being liberal enough, but the fact is that the appraisal of companies involves huge sums of money, millions of Deutschmarks. Appraisals must be appropriate, which means that the responsibility of the appraiser is huge. Our commission wants to make sure that an appraiser is really good at their work, so that the companies would not suffer damage by their lack of knowledge”, Dušan Mramor said, a member of the commission for licensing appraisers who were assessing the value of companies in the process of ownership transformation.330
4The main state and other legal entities involved in the privatization process were the Agency of the Republic of Slovenia for Restructuring and Privatization, the Development Fund of the Republic of Slovenia (later Slovenian Development Company - SRD), the Slovenian Compensation Fund, the Capital Fund for Pension and Disability Insurance, the National Farm Land and Forest Fund of the Republic of Slovenia, authorized investment companies (PIDs), the Ministry of Economic Relations and Development, the Agency of the Republic of Slovenia for the Audit of the Ownership Transformation of Companies, the Securities Market Agency, the Central Securities Clearing Corporation (KDD) and the Ljubljana Stock Exchange.331 The Ownership Transformation of Companies Act did not apply to all companies. It was not used for companies performing activities of special social importance or public utility services, for companies engaged in the organization of games of chance, banks and insurance companies, companies that were transformed under the Cooperatives Act or the Act on Forests, and for companies in bankruptcy proceedings from the final decision on the commencement of bankruptcy proceedings. If a special law so provided, the Ownership Transformation of Companies Act also applied to the aforementioned companies.332 The following Acts applied to companies and institutions that were not transformed under the Ownership Transformation of Companies Act: the Services of General Economic Interest Act,333 the Cooperatives Act,334 the Act on Forests,335 the Exercising of the Public Interest in Culture Act,336 the Veterinary Practice Act,337 the National Farm Land and Forest Fund Act,338 the Ownership Transformation of Companies (with Socially-Owned Capital) Engaged in Tourist Activity whose Real Estate is Located on the Territory of the Triglav National Park Act,339 the Act Regulating the Privatization of Socially Owned Monuments and Sites of Special Interest,340 the Denationalization in the Procedures of Ownership Transformation of Companies (the Denationalization Act341) and the Ownership Transformation of Legal Entities with Socially- Owned Capital Organizing Special Games of Chance.342
5In practice, five methods of ownership transformation were used, since only one company opted for the method of selling all assets, which it ultimately did not carry out. There was a total of 1,371 companies and they most frequently opted for the transfer of shares to funds, internal distribution and internal buyout. The transfer of shares to funds was a mandatory method of the Ownership Transformation of Companies Act, but about 3 percent of companies did not transfer their shares to funds because they made use of the purchase price instead of shares. Furthermore, there were a few companies that were transformed under the Cooperatives Act,343 also without a mandatory transfer of shares to funds. The companies transferred them only if they did not take advantage of the transformation of 40% of the capital through a public sale of shares. Internal distribution and internal buyout methods were used in most companies. 96.57 percent of companies used the method of internal distribution, while 91.39 percent used the internal buyout. These two methods were most frequently chosen because the beneficiaries of the internal distribution and internal buyout were able to buy the shares with a 50% discount, thus avoiding the entry of external owners.344
6The Ownership Transformation of Companies Act thus combined repayable privatization with the free distribution of part of the socially-owned capital to workers and Slovenian citizens. In June 1993, the National Assembly passed the Act Amending the Ownership Transformation of Companies Act.345 This shifted the original concept in favour of the so-called “redistributive” privatization, while the repayable privatization, which had been in the forefront until then, had to recede into the background. The changes brought a number of reliefs and benefits to internal buyouts, which were intended to enable the employees greater participation in ownership. The companies were allowed to determine the value of socially-owned capital by choosing the most favourable valuation. The original provisions only allowed a choice between values according to the opening balance sheet and values according to the net asset value method, where certified appraisers would participate.346 In Slovenia, the so-called distributive privatization was thus carried out. The latter included internal distributions and buyouts by employees and mandatory transfers to funds. The proponents of distributive privatization argued that its main advantages for transition countries were the speed of the transfer of a large part of the economy to the private sector and the revival of the capital market. Distributive privatization in Slovenia directly covered a large part of the non-financial sector and indirectly affected virtually the entire economy. Privatization was in principle decentralized on the supply and demand sides, but in reality, the decision-making was limited on both sides. In the generally independent preparation of privatization plans, companies were fairly limited by legal provisions, and the opportunities for investing certificates depended on their plans. Although the law provided for a whole range of privatization options, of the more than 1,300 companies directly involved in distributive privatization, very few were listed at the stock exchange. These were only the largest and best-performing companies, which conducted a public offering of shares for certificates. Investments of certificates for the shares of these companies were exceeded in all cases, in some by several times. Most citizens invested their certificates in the internal privatization of companies as employees and former employees, as well as in privatization funds that were listed on the stock exchange. The pharmaceutical company Lek was the first in Slovenia to decide on a combined privatization, which also included the public sale of shares. The director of Lek, Metod Dragonja, said in February 1994: “We estimate that dispersed ownership will have a more favourable effect on Lek's position in the future than if this ownership would largely be state ownership”.347
7In practice, the choice on the method of privatization was decisively influenced by the legal principle of autonomy, which gave managers and employees in companies the right to choose a combination of privatization methods. The first feature of this choice was that in the context of privatization under the Ownership Transformation of Companies Act, companies practically did not opt for selling shares to strategic partners. This is also one of the basic characteristics of the Slovenian distributive privatization in comparison with similar countries in transition. Namely, the Slovenian distributive privatization did not directly enable the entry of strategic owners and especially not foreign strategic owners into the companies that were the subject of privatization. This only occurred to a few dozen companies. Another feature of the selection in the framework of the distributive model was that managers and employees generally exercised their pre-emption right for the purchase of 40 percent of the shares under favourable conditions up to the upper limit allowed by their financial capacity. In all Slovenian companies, distributive privatization was carried out as a combination of internal, external and in some companies public privatization. In addition to internal privatization, external and public privatization gained importance mainly in larger and more capital-intensive companies. External privatization involved the distribution through funds, while public privatization involved the public offering of shares to citizens in exchange for certificates. Based on the share of these three forms of distribution in companies, three typical groups of companies were formed in Slovenia:
8Despite the long-term process of adopting the Ownership Transformation of Companies Act, the latter retained its shortcomings even after its adoption. In one of her articles relating to the said Act, Anica Popovič quoted Miran Mihelčič, who was, like many others, very critical of the lengthy adoption of this Act. Mihelčič wrote: “While many were wise about the possible paths of ownership transformation, others put into practice the realization of the connection between distribution and privatization or privatization and distribution and divided amongst themselves (with a shift from the creative to the consumer sector) a considerable piece of social wealth”.349 Many complications in practice were related to the legal regulation, which, according to the deadlines from Article 20 of the Ownership Transformation of Companies Act, regulated the procedures of ownership transformation from 1 January 1995 onwards.350 One of the problems was certainly the completely misguided legal deadlines contained in the Ownership Transformation of Companies Act, which, among other things, again triggered the unnecessary “legalization” of “wild privatization” after 1 January 1993. Another issue was also the non-uniform information system, which in itself increased the non-transparency and autonomy of the operation of individual institutions instead of improving their coordination in terms of content and time.351 In 1997, the Social Attorney of the Republic of Slovenia, in cooperation with the Agency of the Republic of Slovenia for Restructuring and Privatization, had to prepare a report for the Commission for Monitoring of the Ownership Transformation and Privatization of the National Assembly of the Republic of Slovenia (in the first convocation of the National Assembly, it was called the Commission for Monitoring and Control of the Ownership Transformation of Socially-Owned Property, both of which were chaired by Izidor Rejc), stating that a lot of ambiguity was brought about by the legislator's assumptions, which restricted audits to a three-year period from 1990 to 1992, assuming that the pre-privatization audit procedures would be completed by the end of 1994. Auditing after 1 January 1993 was not legally allowed, which triggered a second wave of “wild privatization” transactions and a host of problems with regards to the regulation pertaining to the preparation of opening balance sheets on 1 January 1993.352 The subsequent introduction of the so-called “second audit” in mid-1996 in cases where the ownership transformation had not yet been completed led to proceedings where all damages were attempted to be remedied before the privatization was completed, especially in cases where the damages identified in the first audit only continued.353 In the period from 1 July 1993 to 31 March 2001, the Social Attorney of the Republic of Slovenia received 1,151 audit reports and filed a lawsuit on the basis of 293 or 323 audit reports respectively (the reason for two different data is the fact that one or more actions could be filed for an individual audit report or only one action could be filled for several audit reports).354 In the period from 31 March 2001 to 30 June 2004, the Social Attorney received an additional 97 audit reports.355
9The responses to the Ownership Transformation of Companies Act varied, both among the experts and the general public. Aleksander Bajt argued that the legalized system of ownership transformation was unconstitutional. Among other things, the Act determined which circumstances justified privatization and which prevented it. Namely, the Act turned the personal circumstances of people, which were supposed to be excluded according to the Constitution, into the basic criteria of privatization. In addition, the legislator adopted rules that were contrary to the already established ones, thus creating an internally contradictory system. Due to the reckless introduction of an ill-conceived privatization system, wild privatization occurred, among other things, again caused by the legislator.356 Shortly after the adoption of the Ownership Transformation of Companies Act, the economist Jože Damijan also expressed his view on the latter - from today's perspective, in a truly visionary manner. He wrote in December 1992: “After the adoption of the Ownership Transformation of Companies Act, which we have all been waiting impatiently for at least two years, it is increasingly doubtful that foreign capital will even be able to penetrate Slovenia. The Act clearly gives priority to Slovenian investors, and even here especially to employees in companies who will already receive ownership certificates through privatization ... However, make no mistake, although the Act says that employees can buy a share, it is highly doubtful that the company will be bought out by the workers as they will exchange their ownership certificates for liquidity financial forms as soon as possible due to their miserable wages. All together, of course, with a certain discount of up to 50%. It is already quite clear who will buy these certificates - especially the current management structure, which is the only one, thanks to sophisticated financial machinations in the past, able to raise enough money to buy a majority share in the company and manage it.” In Damijan's opinion it was also “idiotic” to talk about any sort of social justice when it came to ownership relations, and it was right that capable managers were given ownership control in companies. “It is also foolish to expect that foreign capital will be ready to venture into Slovenia, when the best companies are already reserved in advance for current managers”, he wrote.357
1In October 1993, based on the Ownership Transformation of Companies Act (excluding public companies, companies with forests, cooperatives, banks, insurance companies, casinos and bankrupt companies), SIT 567 billion of free ownership certificates were issued to the population. These expired in July 1997, leaving 67 billion Slovenian tolars unused. In the first half of 1993, the Social Accounting Service (SDK) opened 2,000,900 certificate accounts for all citizens of Slovenia.358 According to the Ownership Transformation of Companies Act, it was initially envisaged that ownership certificates would be distributed according to length of service. This was later changed in the Act Amending the Ownership Transformation of Companies Act in 1993, and ownership certificates were distributed among the population based on their age on 5 December 1992 in the following nominal value:
2Citizens thus received non-transferable ownership certificates, which they could then exchange for shares. Some managed to invest in successful companies, while most certificates ended up in the so-called investment companies with no major value. The amount of the certificate value was determined by age categories.360 Due to various forms of damage, the entirety of the socially- owned property decreased, resulting in the lower value of invested certificates, while a certain percentage of certificates could not be invested anywhere because the property ran out.361 58 percent of ownership certificates were invested in authorized investment companies, 32 percent in companies, while some remained unused. Because the purchase of certain company shares was dependent on the employment in this company, the possibilities to purchase company shares were limited. The possibility of using the certificates in public sales by companies was also limited due to the insufficient number of companies. The majority of the certificates were therefore used for the purchase of shares of authorized investment companies.362
| Invested in: | SIT billion | % |
| Authorized investment companies | 329 | 58 |
| Companies | 181 | 32 |
| Unused certificates | 57 | 10 |
| Total certificates issued | 567 | 100 |
3There was a lot of talk about certificates and their value at that time. Some believed they were just worthless pieces of paper, while others disagreed. One of them was the then State Secretary at the Ministry of Economic Relations and Development, Anton Rop, who said the following about the certificates: “Given that we are just starting an intensive campaign regarding the ownership certificates, it is very positive that people's expectations are not too high and that they have a realistic and sober attitude towards them. People need to be told that certificates do have a certain value, but that their real value or the market value of listed shares will become apparent only in time.”363 In 1992, Franc Zagožen, who was already a member of the first National Assembly of the Republic of Slovenia, described the story of ownership certificates in a very interesting way. He pointed out that at that time both the economists and politicians were telling people that ownership certificates or shares they owned were worthless, and the result was that people were gladly selling them (Dimitrij Rupel, for instance, sold them to the Red Cross364). This, of course, was taken advantage of by those who were aware that ownership certificates or shares had their value. According to Zagožen, the thing was, that “either the economy is going to hell or the value of those shares will increase”.365 Even before the certificates were even distributed, Anton Rop described their role in the following words: “Those who say that certificates mean pulling the wool over the citizens' eyes are at the same time in favour of changing the Citizenship Act, preparing a referendum on it and thus preventing the issuance of ownership certificates so that they would not be obtained by citizens of other republics. They believe that this would mean an unfair distribution of Slovenian property. I do not know why they ‘fret' so much about them if they think they have no value. I believe we should not pay too much attention to such opinions, as this is typical politicization. My position is that we need to finish the project and have a positive attitude towards it. In fact, the ownership certificate is an instrument of distribution of socially-owned capital, which definitely has some value. The future will show how much this is actually worth, but it depends on numerous factors”.366 At the time, it was good to know what people could do with the certificates. “They can invest them in their own company or in companies that will sell the shares at public sales. The third option is funds. It is also possible that the certificate is not used. For those who do not believe in them, this can be an interesting option. There will be no average Slovenian profitability in the funds, as we hope that they will not be all the same, but that they will be specialized and each with their own orientation”, Marko Simoneti pointed out, who was the head of the Agency of the Republic of Slovenia for Restructuring and Privatization until May 1993 and then took over the reins of the C.E.E.P.N., an international organization based in Ljubljana, which brought together the ministries of the Agency for Privatization and the markets.367
4In June 1994, the GRAL Marketing agency conducted a survey among the Slovenian population, in which people were asked how satisfied they were with the course of privatization. The results showed that people at the time generally supported privatization, as they believed that the transition from socially- owned to private property was urgently needed for faster economic development. However, they doubted the correctness of the chosen method. They were only familiar with the outlines or individual components of the Slovenian model of privatization, but they were not able to connect them into a whole. People had negative attitudes related to the vagueness of the model, allowing wild privatization, slow pace of privatization and too slow resolution of denationalization procedures. They had the feeling that everything had been agreed in advance and that those people who had more information would pick up the “cream” of the crop, while the rest would be “cheated”. People were reacting very emotionally in general and had a constant feeling that they will be tricked. The attitude towards the certificates was negative in most people. They were treated as worthless pieces of paper and many wanted to sell them as quickly as possible. Most would sell them for half the nominal value, while certain individuals even for only 10 percent of the value. The most common reason for this was the lack of money for everyday things. Frequently, people's ignorance of the operation of the stock exchange, stock trading and stock companies was also in the background and some did not know how to get a stockbroker. Of course, there were also those who viewed the certificate as an investment and who expected a profit in a few years. The decision to invest the certificate was most strongly influenced by family and acquaintances. Most employees said they would invest their certificates in their companies, but the motive for this was not profit, but rather job retention, loyalty, help to the company and the possibility of purchase with a 50% discount. People were highly unfamiliar with the institutions that carried out the process of ownership transformation, they were also not acquainted with the operation of the privatization office and the brochure called From Certificate to Share (Od certifikata do delnice). The survey thus showed that people were extremely unfamiliar with the privatization process, and the attitude towards it was rather sceptical and reserved.368 The population therefore largely sold out the ownership certificates, thinking that they had no value anyway. Some experts and politicians were of the same opinion. We need to be aware that at that time, neither politics nor the profession knew what will actually happen and how things will turn out. If most people were selling their certificates, there were also individuals who were buying them, taking many risks on the one hand, while creating a fortune on the other. These were individuals who mainly bought the certificates through their companies. In this manner, the following people succeeded, for instance: Darko Horvat with Aktiva, Igor Lah with Divida, Stane Valant with Nacionalna finančna družba (National Financial Company) and Matjaž Gantar with Kmečka družba.369
5“It seems it is not entirely clear what we expect from the funds in Slovenia. The goals are different for different people. One of them is making sure that insiders do not get everything, but that something is left for outsiders as well. The second aim is that part of the property is distributed among the citizens. It is only now that the difference between active and passive owners has begun to be considered”, Marko Simoneti said in November 1993 on the investment privatization funds, which were provided for by the investment funds act at the time.370 In November 1993, Roman Androjna wrote in Agens that “in developed western economies, investment funds have long been an established form of financial intermediaries performing the role of forwarding savings in investments” and for this reason “investment funds are of great importance for the national economy, for citizens and companies as well as in the development of the capital and securities market”.371 The importance of investment funds, which can be roughly divided into open-end and closed-end funds, is mainly the following:
6An authorized investment company is a special form of investment company established for the purpose of collecting ownership certificates and buying shares issued in accordance with the regulations on the ownership transformation of companies.372 Within the institutions that emerged from privatization itself, privatization investment funds or authorized investment companies, as they are officially called, were certainly important institutions and were the subject of various critics since their inception. The course and development of the Slovenian economy was surely influenced by the Investment Funds and Management Companies Act,373 adopted in 1994, which was later amended several times, most recently in 2002, when the ZISDU-1 version374 was adopted. Until the end of 1997, there was no real investment company that would be managed in accordance with the legislation.375 As the director of Nacionalna finančna družba (NFD) d. o. o. (National Financial Company), Stanislav Valant, said in an interview in September 2003, authorized investment companies started collecting ownership certificates in July 1994 and the Slovenian experience with them is certainly the most positive among all the experiences of mass privatization. Valant believed that in Slovenia there were much less excesses than in the Czech Republic, Poland and Russia. However, he admitted that they did also occur in Slovenia and that, unfortunately, “the period of transition is also a period of excesses”. Privatization funds were almost completely unknown to most at the beginning of Slovenian privatization. Valant added the following about the role of authorized investment companies: “The funds have caused a new phenomenon in the Slovenian society, namely the phenomenon of distribution and new division of influence in companies. Until the initiation of the privatization process, politics was accustomed to controlling the economy, and in fact it had no competition. With the advent of funds, it acquired it, however, as a result, many assessments of the image and operation of investment funds are of course politically motivated. Decision-making methods began to emerge that differed from those that the politics was accustomed to in the previous period. This is the part that is not much discussed, although it is a fact in all countries in transition”.376 In any case, authorized investment companies were a novelty and a competition to politics, which is a good thing. The funds also played a positive role in introducing new decision-making systems, where they could play an even greater role with better professional competence. The problem was mainly the lack of education in this field. At the time of the establishment of investment funds, there was a significant shortage of people with minimum knowledge of what investments funds are, what their role is, how to run management companies or how to manage portfolio investments. At this point we stumble at the negative role of privatization investment funds. Due to general ignorance, the connoisseurs were able to greatly improve their financial position. Among other things, irregularities in the form of concentration of ownership and similar ones could occur. It should be noted that more than a million people invested their certificates in authorized investment companies. Somehow, the belief prevailed that investing the certificates in them was the safest. Later on, people justifiably feared that they would not get an adequate share of the once common property.
| Type of company | Number | Capital in SIT |
| Mutual funds | 15 | 2,817,490,000.00 |
| Authorized investment companies | 69 | 526,430,490,000.00 |
| Total | 84 | 529,247,980,000.00 |
7Nearly 60 percent of ownership certificates were invested in authorized investment companies. According to the known data, the latter collected certificates worth 130 to 140 billion Slovenian tolars (estimated at 158.1 billion377 in December 1999) more than they managed to obtain assets, i.e. shares of the companies that were transformed in terms of ownership.378 This “privatization gap” was supposed to be closed by privatizing state property. For this purpose, in addition to 100.1 billion tolars of its assets, the government approved a part of the state share in both state-owned banks, insurance companies and ironworks, and it still had to provide around 18 billion Slovenian tolars of state assets.379 Just before the May Day holidays in 2001, the then government allocated more than 35 billion tolars of additional assets to fill the 84 billion tolars of privatization deficit. It allocated the shares of the companies of the Slovenian Development Corporation, shares and stocks of companies transferred to the state by the Slovenian Compensation Company and the Capital Fund for Pension and Disability Insurance in exchange for bank shares, part of assets in Šoštanj, Brestanica and Trbovlje Thermal Power Plants and shares of the companies intended for authorized investment companies under property laws. Majda Zupan, one of the then members of the National Assembly, addressed the then Prime Minister Janez Drnovšek at one of the sessions and asked him the following question: “What does this mean for the shareholders of authorized investment companies?” She added that “the property of the shareholders of authorized investment companies will be worth very little and because this is the largest part of the participants in the ownership transformation, it means that they will be defrauded of what was promised to them”. Drnovšek replied that the government was trying to “complete the process of acquiring or transferring state property to authorized investment companies and legally fill the so-called privatization gaps”. The words with which Drnovšek continued are suggestive: “I heard about the complaints of authorized investment companies, they also wrote a letter to me, saying that they were not satisfied with the quality of the property. Well, of course, property can be a little better or a little worse, it is just of different types. Authorized investment companies also have to come to terms with the fact that they just get some average property. So, sometimes - a little better in some places, a little worse in others, relatively speaking.”380 These words certainly did not bring joy to more than a million of those who had invested their certificates in authorized investment companies. On the last day of 2003, the deadline by which authorized investment companies had to be transformed expired. This was determined by the Investment Funds and Management Companies Act, the First Pension Fund of the Republic of Slovenia and the Transformation of Authorized Investment Corporations Act (ZPS PID)381 and some other regulations. For those authorized investment companies that did not obtain the approval of the Securities Market Agency for transformation, the Agency prepared a plan for the transfer of management to another management company. A management company would have lost its management license if the transformation of an authorized investment company had not been carried out in time. However, most of the already transformed companies decided to transform into a regular joint stock company or the so-called financial holding company. In exceptional cases, they were transformed into a mutual fund. According to the legislation, management companies had to harmonize their operations by 1 January 2004. After that, there was a long-standing controversy over how to regulate the status of the successors of authorized investment companies. This was finally regulated by the Legal Successors of Authorized Investment Companies Act (ZPN PID),382 which was adopted as late as 2007.
1In the period from 1990 until the adoption of the Ownership Transformation Act at the end of 1992, numerous companies were transformed, recapitalized or reorganized on the basis of the then Yugoslav legislation (the Enterprises Act383 and the Traffic and Disposal of Social Capital Act384). Since the state did not yet have a fully established institute of control over the status and property-capital transformation of companies with socially-owned capital there was, of course, a great possibility of abuse. This period was thus a fertile ground for the so-called “wild privatization”. In accordance with the provisions of the Ownership Transformation of Companies Act, audits took place both in companies that had undergone ownership transformation before the adoption as well as in those companies that were transformed after the adoption of the Act. The audit bodies included the Social Accounting Service of the Republic of Slovenia, the Agency of the Republic of Slovenia for Payment Transactions, Supervision and Information and the Agency of the Republic of Slovenia for the Audit of the Ownership Transformation of Companies.385 While individual theorists and the government considered whether it would be more wise to simply distribute the shares in factories to workers or to allow the latter to buy them with long-term loans, Alenka Žnidaršič Kranjc believed that socially-owned property was being devalued, sold, looted or even stolen - the holder of the property right was becoming known. Žnidaršič Kranjc divides harmful phenomena related to the privatization of socially-owned property into three groups:
2Observing the forms of criminal, immoral, unethical and unconstitutional acts against socially-owned property, a cause for concern was the fact that the “small thieves” of socially-owned property, who were improving their family budget with afternoon earnings, with the opportunities provided by the employment in socially-owned companies (appropriation of spare parts, reproductive material, etc.), were joined by representatives of the so-called white-collar workers, business or structural crime, more obviously than in the past. The majority of forms of transformation of socially-owned property into private, at least in the first period, took place at the levels of company management, with the participation of intellectuals and with the participation or knowledge of local and other authorities. It was only later that we could observe the development of forms that tried to legitimize these events by involving all employees. Although representatives of the general public as well as individual members of the authorities and various levels of social control had always known that these phenomena occur, there had been no serious incentives to prevent them. By abandoning the resolution of individual cases or by the impossibility of proving them, it occasionally even seemed that the spread of these phenomena was even encouraged.386
3The Ownership Transformation of Companies Act, adopted at the end of 1992, tackled the issue of wild privatization in Article 48, which read: “Prior to the commencement of the transformation, a financial, accounting and legal review and verification of the legality and regularity of the business (hereinafter: the audit procedure) is carried out in the companies or their subsidiaries or affiliates which were in the period from 1 January 1990 to the entry into force of this Act, that is, on 5 December 1992, in any way transformed, reorganized, or they transferred social capital free of charge or established and invested in new companies, or transferred individual business functions to other companies if there is a reasonable suspicion that damage to socially-owned property has been incurred”.387 In 1995, the Agency of the Republic of Slovenia for the Audit of the Ownership Transformation of Companies (hereinafter referred to as the Agency for the Audit) was established on the basis of the Act Amending the Law on the Agency of the Republic of Slovenia for Payment Transactions, Supervision and Information.388 The Agency for the Audit came to life after numerous complications with the division of the former Agency of the Republic of Slovenia for Payment Transactions, Supervision and Information (APPNI) and was primarily expected to complete the work of the latter. The first director became Alenka Kovač Arh, who started her work as late as 7 August 1996.389 The Agency for the Audit could only review the ownership transformation in companies whose ownership transformation process had not yet been completed, or in those companies that had not yet been entered in the court register. The audit had to be carried out at the proposal of the bodies of internal affairs, the State Prosecutor, the State Attorney, the Social Attorney, the Agency of the Republic of Slovenia for Restructuring and Privatization, the Slovenian Development Company, the Slovenian Compensation Fund, the Capital Fund for Pension and Disability Insurance, the beneficiaries under the regulations on the return of property, the National Assembly of the Republic of Slovenia and local community bodies, or it could initiate the audit procedure ex officio. The Agency for the Audit issued an audit report on the findings, which it had to serve on the audited entity, the Agency of the Republic of Slovenia for Restructuring and Privatization, the Social Attorney, the competent state prosecutor, the competent internal affairs body and the other eligible applicants requesting the audit.390 The Agency operated until 1 August 2004, when it ceased to exist under the Act abolishing the Agency of the Republic of Slovenia for the Audit of the Ownership Transformation of Companies.391 During this time, the State Attorney's Office of the Republic of Slovenia entered into unfinished lawsuits and administrative disputes instead of the Agency for the Audit and continued its work. Important information that sheds light on the causes for damaging the socially-owned property is also contained in the material of the Social Attorney of the Republic of Slovenia (details of the establishment are presented in the methodological introduction). The institution of the Social Attorney was “drastically reduced” already at the time of Slovenia's first independence activities. According to the Deputy Social Attorney of the Republic of Slovenia, Janez Krnc, this is also one of the reasons why wild privatization was flourishing in the early 1990s or why these were questionable transactions under the legislation at the time. Like many, Krnc also believed that the lion's share of the controversial privatizations could be attributed to the “incredible delay in the adoption of the Ownership Transformation Act”. The latter also wrote in 1997: “Today, we often hear that wild privatization took place according to the so-called Markovič acts. If that were true, it certainly would not be controversial, illegal. In fact, it only referred to Markovics legally vague idea of privatization.”392
4When the Ownership Transformation of Companies Act also enacted audits of pre-privatization at the beginning of 1993, the majority of the disputed transactions had already been completed. The legislator then divided the various forms of damage into two groups. The first group was presented in Article 48, where ten indents described various such alleged damages, and the second was represented in Article 48a, which listed ten cases and provided quantitative criteria for each damage incurred. With them, it was possible to precisely determine the value of damages and legally order the audited legal entity to execute all the necessary adjustments for the proper attestation of socially-owned capital. In terms of content, procedures and jurisdiction, these were two groups of completely incomparable damages, which created a great deal of ambiguity in practice. The first group (Article 48) was under the jurisdiction of the Social Attorney, while the second (Article 48a) was under the jurisdiction of the Agency for the Audit.393 The Social Attorney's jurisdiction therefore included only damages under Article 48, where the Act provided for the filing of lawsuits for their elimination if the audited company did not voluntarily eliminate the alleged damages within 30 days. According to Janez Krnc, such lawsuits were a major obstacle, as they stopped privatization and could ultimately mean the transfer of socially-owned capital to the ownership and management of the Development Fund of the Republic of Slovenia, which also meant the loss of the right to autonomous privatization.394 By the end of 1996, the Social Attorney had reviewed 990 audit reports and estimated that the presumption of damages under Article 48 was substantiated in 39 percent of audit reports. It would be wrong to assume that in the remaining 61 percent there were no damages, as these were damages which were not within the jurisdiction of the Social Attorney. A special feature of the audits were the cases of so-called parallel or by-pass companies.395 Anica Popovič, the Social Attorney of the Republic of Slovenia, described the establishment and operation of by-pass companies as a “higher form” of damage to socially-owned property. In her opinion, this was a well-known and widespread phenomenon of privately owned companies established by employees of a socially-owned company with the same or a similar subject of business for which the socially-owned company was registered. Most of the time, both companies (socially-owned and private) were operating in the same business premises, they had the same telephone numbers and the same managers or authorized employees, while no one was usually employed in the private company. The two companies concluded business cooperation agreements, according to which the private company concluded transactions on its own behalf, which were then performed by the socially-owned company or the founders of the private company, who were also employed by the socially- owned company. The private company then issued invoices, collected margins and more. In this way, the private company began to oust the socially-owned company from the market, take over its operations and thus abolish it or in other words, socially-owned property was transformed into a sort of property fund, which served to fill the giro account of the private company and the pockets of the founders until its annihilation. Since the private company or owners thus obtained profits at the expense of socially-owned property by a prohibited diversion of business and financial flows from the socially-owned company to itself, this was a clear case of “wild privatization”.396 By the end of 1996, a total of 215 by-pass companies were identified, or an average of two bypass companies for every audited company in which they opted for this form of pre-privatization. Given the data on the number of by-pass companies, the mere assumption of organizing a by-pass company does not tell a lot. The actual damages in these cases ranged from the cases of by-pass companies where there was only a possibility of damages to the other extreme when virtually all business functions and associated effects were transferred to by-pass companies with different questionable transactions. In these cases, the parent company was usually left with only the right to dispose with a greater or lesser value of socially-owned capital, usually with the value of real estate. Audit reports of the Social Attorney of the Republic of Slovenia pointed out that many derivatives of various ideas or models of pre-privatization were established in practice between the two extremes, which differed mainly in the actual volume of “wild” privatization. According to Krnc, the latter continued with the organization of by-pass companies even after 31 December 1992, as sometimes even decisive wild privatization transactions were carried out after this deadline. However, based on the legislation contained in the Ownership Transformation of Companies Act, until the establishment of the Agency of the Republic of Slovenia for the Audit of the Ownership Transformation of Companies in 1996, i.e. after a period of almost three years, it was not possible to implement an appropriate audit of pre-privatization, nor to act in accordance with the Ownership Transformation of Companies Act.397 As Popovič called it, one of the “higher forms” of damage to socially-owned property in the early 1990s, or until the adoption of the Ownership Transformation of Companies Act, was the free transfer of socially-owned capital, which referred to the second paragraph of Article 145 of the Enterprises Act from 1990. The described transfer of capital, even if it took place between socially-owned companies, was unlawful. In this manner, joint ventures became the owners of socially-owned property in socially-owned companies and, indirectly, already privatized the socially- owned companies without the law on privatization, which was inadmissible and illegal.398 Anica Popovič wrote the following regarding the “controversial privatization” in one of her articles in October 1992: “There would be much more order in the field of privatization if the Executive Council of the Assembly of the Republic of Slovenia on the basis of the assignment by the Assembly of the Republic of Slovenia in the Constitutional Act of 23 January 1991 prescribed the criteria according to which the Agency of the Republic of Slovenia for the Promotion of Economic Restructuring and Encouraging of Company Renewal could control and issue consents for the issuance of internal shares. This is no longer important today in 1992, because it is no longer possible to issue internal shares under the so-called Markovič Act, but the original sin began with the non-acceptance of the mentioned criteria, because the privatization of socially- owned property was possible without sufficient rules and regulations from the very beginning, which is still valid for today's period, as, for example, the ominous Article 145b of the Enterprises Act, which has been in force since 18 August 1990 and allows free transfer of socially-owned property at will, has not been repealed nor amended by the Slovenian Parliament despite numerous warnings. The Constitutional Court issued an embargo on its application on 28 November 1991, but to this day it has not adopted an assessment of the constitutionality or legality of this provision and, of course, of the consequences.”399 In general, all calls for measures to protect socially-owned property fell on deaf ears with the politics. On 16 May 1990, the Parliament did not support the government in its proposal to call on the Slovenian public to protect socially-owned property. The discussion in the Assembly ended with the general conclusion that there is no problem of selling and stealing socially-owned property and that it is therefore unnecessary to accept such calls. Later on, however, a commission was formed (the so-called Toplak Commission400) to study the phenomena of damage to socially-owned property, but mainly on the principle of “if you do not want to solve something, form a commission”, which later proved to be the case, as the commission ceased to function without any results. In August 1990, the government drafted an act on the protection of socially-owned property, but the relevant secretariat failed to “concretize” it. In September 1990, proposals for the adoption of constitutional laws were also rejected, stating that their adoption would hamper positive changes in the economy and cause damage to it, and in the event that such abuses existed, law enforcement agencies should be the ones to intervene. In parallel with these events, statements and warnings about the prevalence and individual forms of “wild privatizations” became virtually “blasphemous”, especially after the adoption of the constitutional amendment XCVI to the Constitution of the Republic of Slovenia, when the Agency of the Republic of Slovenia for the Promotion of Economic Restructuring and Encouraging of Company Renewal in December 1990 formulated and later supplemented expert positions on the application of various legal bases for the transformation of companies operating with socially-owned capital. Discussions about this were “ridiculed or defined as personal attacks on individuals, groups and companies”, as such “socially undesirable illegal forms of privatization were supposed to not exist at all”. A great deal of blame for the damages can be attributed precisely to politics and its ignorant behaviour towards this problem. As Alenka Žnidaršič Kranjc wrote in 1992, in the pre-election time of 1992, the theses on illegal privatizations suddenly became relevant again, similarly to what occurred before the elections in 1990.401
5According to the data of the Agency for the Audit, damage was incurred to socially-owned property in the amount of 86,174 million Slovenian tolars in the period from 1 January 1990 to 31 December 1992. The number itself naturally tells us extremely little. However, by calculating or revaluing the amount,402 we come to a very interesting amount. The value of the above-mentioned revalued amount was EUR 1,238,454,581.87 on 2 October 2008.403 The calculation takes into account the movement of price indices during the period considered, which were a measure of inflation. The amount is high, especially assuming that not all damages and crimes were detected. Let us add that the budget of the Republic of Slovenia for 1992404 amounted to more than 174 billion Slovenian tolars or more than 2.5 billion euros (revalued amount).405 In any case, a small part of the population benefited greatly during this period. The largest damages were the result of unjustified write-offs of receivables, incorrect distribution of profits and unpaid capital transfers.
6Due to complications and the lengthy adoption of privatization legislation, two state institutions were established in December 1990 to supervise and regulate the implementation of privatization in Slovenia and to assist in it. The Agency of the Republic of Slovenia for Restructuring and Privatization monitored and supervised the process, prepared instructions, approved privatization programmes and later performed audit procedures for the period before the Ownership Transformation of Companies Act. The task of the Development Fund of the Republic of Slovenia was to restructure companies. It also became the owner of companies and was able to negotiate and sign sales contracts. Prior to the adoption of the privatization legislation, the Development Fund also received the proceeds from sales and invested them further. Privatizations that took place before the adoption of the Ownership Transformation of Companies Act were carried out under the federal law on socially-owned capital and the Enterprises Act. The latter gave companies (i.e. workers' councils and management) the right to decide whether to privatize or not. In this context, it was not possible to privatize companies against their will. As early as 1991, the old Yugoslav legislation proved inadequate. Amendments to the Enterprises Act were passed to prevent management and workers from buying companies at extremely low prices. The government entrusted additional control over the process to the Agency for Restructuring and Privatization. The basic principles of the Agency's control of privatization transactions were the following: the procedure had to be competitive and transparent, the financial statements of companies had to be audited and their assets assessed, and the right to vote and share profits had to be divided among the owners in proportion to the value of the investment. After the second half of 1992, virtually all transactions required the written consent of the Agency before being registered in court. In one year, about 1,000 cases were reviewed and nearly 800 were approved. They were mostly reorganizations of socially-owned companies and partial privatizations through the sale of part of the assets or shares. Such deals frequently represented the first steps in the comprehensive privatization of large companies.406
1Entrepreneurship played an extremely important role in the development and restructuring of the market economy and is one of the largest and most important socio-developmental economic factors of contemporary time.407 There are a number of definitions of entrepreneurship, although they are essentially similar. Let us mention just two. The first reads: “Entrepreneurship is an attempt to create added value by identifying business opportunities, managing the risk appropriate to that opportunity and through communication and managerial skills mobilizing the human, financial and material resources required for the success of the company.”408 Another definition says: “Entrepreneurship can be defined as a process that takes place between a person, an idea and resources, while the company is a place where this process is realized. The essence of entrepreneurship is the increase of value added in the company, where the key element is the opportunity or such a use of funds that is highly valued by the market.”409 Entrepreneurship is essential for the functioning of a market economy, especially with structural changes characteristic of the transition to a higher level of development or from one social system to another, as seen in Slovenia. In the periods of structural changes, the economic growth that is based on the existing industry and markets generally stagnates, while the growth becomes even more dependent on the creation of new markets and activities, which is precisely the characteristic of entrepreneurs.410 The dynamic business sector has been and still is the key to economic development. Entrepreneurship also played an important role in creating new jobs and thus contributed to economic performance and social situation. The creation and growth of new companies strengthened the competitiveness of the existing companies, created new ideas and innovative approaches and thus led to a more diverse choice and greater value of products and services for consumers. The strengthening of entrepreneurship also played an important role in promoting harmonious regional development and employment growth, especially in the regions that lagged behind in development.411 The development of entrepreneurship and the establishment of new companies are mainly influenced by three factors, namely favourable macroeconomic conditions, well-planned and implemented state programmes and the reputation of the entrepreneurial career in society. Trade policy played a crucial role and could either facilitate or hinder the access of small and medium-sized companies to the markets of their products. Countries with greater entrepreneurial activity have better opportunities for economic development, as they are more flexible in mobilizing resources and introducing new products and services. The more dynamic and developed business environment a country has, the more it is interesting for foreign investors.412 The role of micro, small and medium-sized enterprises (SMEs) must be especially emphasized, as the development of this sector was highly important. In Slovenia, supporting SMEs does not have a long tradition. After Slovenia's independence, the state devoted most of its resources to rescuing large companies, and the policy of encouraging SMEs was changeable and indecisive in the 1990s. However, the fact is that SMEs are recognized as potentially the most dynamic part of the economy, as they are often more flexible in their operations than large companies. Such companies are also a major generator of economic growth and new jobs.413
2In the time of Yugoslavia, companies were in the so-called “social ownership” and belonged to the entire society. Workers' councils played the role of the owner and, together with the company's management, represented the main managers of socially-owned companies. Slovenian companies thus operated in a sort of market system that was very different from central planning in other communist countries. It was precisely these conditions that encouraged the development of managerial skills.414 The vast majority of changes in Slovenia's economic system can be linked to the abolition of social ownership of business enterprises. The manner in which socially-owned property was formed and derived did not greatly influence the formation of business enterprises, but had a decisive effect on the development of banks, other financial institutions and capital markets. Through its influence on institutions and markets, however, it also influenced savings and capital formation.415 In Slovenia, the door to entrepreneurship was opened in 1988, when the establishment of private companies was legally possible and when the privatization of existing companies began.416 The Enterprises Act,417 adopted in 1988, enabled, among other things, the beginning of the integration of private capital into the corporate sector, allowed the participation of foreign capital in socially-owned companies and abolished social ownership as the only form of ownership. In addition to social companies, it also provided for private, contracting and joint ventures in the form of joint stock companies, limited liability companies, limited partnerships and companies with unlimited joint and several liability of members. The Enterprises Act led to different compositions of companies. The most numerous were the companies whose owner was still “society”, with the workers' council remaining the main body (until the amended Enterprises Act in August 1990). Another form were companies with the characteristics of a planned market system with a defect. These were companies in which the ban on having a permanent participation in the assets was lifted. The third form were newly established companies, which had the characteristics of capitalist companies. The managements of individual companies tried to adapt to the new situation. In Iskra, the largest Slovenian composite organization of associated labour, it was determined at the end of 1989 that in order to improve the situation and survive, decentralization would have to be carried out and a line drawn between corporate and entrepreneurial strategy. Companies began to realize the need to start managing and thinking entrepreneurially and market-wise.418 Under this Act, entrepreneurship could be undertaken by anyone who was brave enough and invested their time and capital for a risky period of survival until they began to make a profit through regular activity. The expansion of entrepreneurship was also positively affected by the abolition of the regulation on the limited number of employees in private companies and the abolition of the land maximum.419 The Act Amending the Enterprises Act, adopted in August 1990, also brought changes. Among other things, it provided for the abolition of workers' councils. The powers of the workers' councils were thus transferred to the company's general assembly, the board of directors and the director. The amended 1990 Act abolished, among other things, the separation between the right to property and the right to manage property. According to the new Act, the right to manage originated only from the right to property.420 Two years earlier, the Small Business Act421 had been passed, removing restrictions on employment in the small business sector. The subsequent liberalization of international trade and the regulation of the foreign exchange market enabled the rapid growth of the private sector, especially in trade.422 The Traffic and Disposal of Social Capital Act423 or the so-called Markovič Act also had a significant impact on development. This legislation triggered two processes that began to change the structure of the economy from a typical socialist structure to a structure characteristic of market economies. It was about filling the gaps in that part of the economy structure that is occupied by small and medium-sized companies in market economies. The first process was the mass emergence of small companies, and the second process the fragmentation of large companies, many of which disintegrated, especially after 1990.424 Both processes led to a large-scale shift of employees from large to micro and small companies over the next ten years. This means that many people found business opportunities outside the existing companies where they were employed. A large number of new entrepreneurs emerged, resulting in a major change in people's perceptions of possible career paths. Psychologically, the circulation of people from one organization to another and from one economic activity to another became perfectly acceptable. Someone who started as a director in an old company, for instance, founded their own company, then went into the civil service, later joined an international advisory group and in the end established a company again. It also became entirely acceptable to be temporarily unemployed. The flexibility of employment greatly increased, and when it came to good business opportunities, people were willing to work on the other end of Slovenia or even elsewhere in the world. More and more people were employed in small and medium-sized companies and the number of selfemployed persons increased. Value added growth originated almost exclusively from the SME sector, which grew from small to medium-sized and large.425 It is interesting to note that in 1990, a very high growth rate in the number of companies was recorded, namely as high as 1,048%.426
3One of the novelties was also the establishment of a stock exchange in Slovenia after almost seventy years. The formation of the capital market and the stock exchange was made possible in 1989 by the Securities Act427 and the Money Market and Capital Market Act.428 On 26 December 1989, the Ljubljana Stock Exchange was established, a joint stock company owned by shareholders - stock exchange members. Due to all the characteristics of stock exchange operations, the Ljubljana Stock Exchange played an important role in the process of ownership transformation of the Slovenian economy. Its most important tasks and role in the process of ownership transformation in Slovenia were: formation and discovery of a “fair” market price of the shares of joint stock companies and transparency of the concentration of ownership in cases of mergers or acquisitions, formation and enforcement of rules and procedures for fair trade, ensuring equal awareness of all market participants and education of investors and issuers as well as a general care for the development of equity culture in Slovenia. In the process of privatization of Slovenian business enterprises, the stock exchange successfully played a role in the secondary market of shares of privatized companies. Organized stock exchange trading enabled the restructuring of the ownership of these companies, including market transparency in the field of mergers and acquisitions. The first company from the process of ownership transformation that was included in trade on the stock exchange was Kolinska Ljubljana d. d., namely on 8 January 1996. By the end of June 1996, there were already fourteen such companies. With the increase in the number of companies and their market value, the volume of turnover also steadily increased (from SIT 33.9 billion in 1996 to SIT 122.7 billion in the first eleven months of 1999). In January 1998, the stock exchange also became a place for trading with shares of authorized investment companies.429 Already in the early 1990s, the Slovenian government estimated that special forms of financial support would need to be introduced to accelerate the development of small and medium-sized entrepreneurship and with the Small Business Development Act enabled the establishment of the Small Business Development Public Fund, which offered incentives to small and medium-sized companies in the form of loans, direct investment in business infrastructure and interest rate subsidies for bank loans and guarantees. The development of small business was also influenced by the Small Business Development Act,430 adopted in 1991. It provided assistance in establishing companies, simplified administrative procedures and certain means of financing, as well as the basis for the creation of a small business development fund and a small business promotion centre.431
4At the local level, a number of funds and forms of financing from municipal budgets were established, however, the funding for microcredits and interest rate subsidies were modest. In 1992, the Small Business Promotion Centre was also founded.432 Legislation of the late 1980s and early 1990s allowed for a rapid growth in the number of new companies, as it did not require a large amount of initial capital from the founders. This had negative consequences for the economic security of investors and business partners. The course or development of entrepreneurship was decisively influenced by the later adopted Ownership Transformation of Companies Act433 and the Companies Act.434 The Companies Act was adopted in 1993 and was later amended several times. All these acts influenced and were the basis for the actual development of entrepreneurship. The average annual growth rate of the number of companies in the period 1991-1993 was as high as 47%.435 It is also crucial to mention the new Small Business Act436 from 1994. These two acts influenced the behaviour of entrepreneurs in choosing the legal form of their business. The Companies Act introduced a uniform legal regulation for all economic entities, thus eliminating the separation between the business and small business sectors, and, among other things, prescribing higher initial capital for the establishment of a liability company. Other regulations also set very high bookkeeping and accounting requirements. The pace of establishing companies slowed down after 1993. This was because part of the entrepreneurial potential was exhausted and competition in the limited market increased, where it was increasingly difficult to find the right business opportunities. It was also due to the state's demands for higher initial capital to establish capital companies.437 The Companies Act and the Small Business Act thus implemented the altered legal and organizational structure of small businesses, initiated a large-scale process of transformation and organizational adjustment, thus causing numerous administrative problems to small business units.438 As already mentioned, the Companies Act was amended several times. The most comprehensive amendment was the Companies Act - F (ZGD-F) of 2001,439which was important for harmonization with the European company law and for internal harmonization and amendments to the primary Act of 1993.440 According to ZGD-F, which governed the rights and obligations of economic operators, companies were divided into small, medium and large companies according to the following three criteria:
5The classification of companies based on the number of employees took place in Slovenia according to approximately the same criteria as in the EU. There were greater differences in the criteria for determining the size of sales revenues and the value of assets.441 From 1994 onwards, companies kept accounting records in accordance with the Companies Act and Slovenian Accounting Standards (SRS). In the period 1994-2002, the number of companies increased every year (except in 1999 and 2001), while the number of employees (except in 1995, 1999, 2000 and 2001) decreased. In comparison with the situation in 1995, when companies were first classified according to the “Standard Classification of Activities”, there were 4,442 more companies in 2002: 2,201 companies more were involved in real estate, renting and business activities, 1,127 more in construction and 775 more in manufacturing. Most of them were still in the fields of trade, repair of motor vehicles and consumer goods, but there were 1,450 fewer of them than in 1995, which also meant 15,436 fewer employees in these activities. In manufacturing, which employed almost half of the working population, there were as many as 23,413 fewer employees, while in real estate, renting and business services there were 9,626 more employees. There were also 4,627 more people employed in construction. The companies' operations became positive in 1998. This meant that net profits were greater than net losses. In 2002, companies had to comply with the Act Amending the Companies Act and the new Slovenian accounting standards in their operations. In that year, companies reported a net profit of SIT 215,498 million, which was the highest profit in the period 1994-2002. Almost half of the value of the total net profit in 2002 was generated by companies from the field of manufacturing, 23.6 percent from trade, repair of motor vehicles and consumer goods, and 16.5 percent from real estate, renting and business services.442
6The economic situation in the first half of 1990 was literally agony. Many companies were operating at a loss. Insolvency paralyzed even the operation of those parts of the economy that otherwise had all the conditions for a successful development. Inter-company indebtedness was extremely high, and the “pluralization” of property was reduced to reckless theft, which could remain civilly and criminally unpunished only in a “socialist” legal system.443 It should be noted that after gaining independence, the state devoted most of its resources to rescuing large companies, while the policy of promoting micro, small and medium-sized companies in the 1990s was volatile and indecisive. This situation began to change with the beginning of the implementation of the European Charter for Small Enterprises, Slovenia's inclusion in the European programmes for the promotion of micro, small and medium-sized companies, the adoption of the Programme of Measures to Promote Entrepreneurship and Competitiveness and the Supportive Environment for Entrepreneurship Act,444 adopted as late as March 2004.445 The year 1991 was a turning point from the socio-political and legal point of view. The Companies Act from 1989 and the new Employment Relations Act from 1990 marked the transition to a new market economy system and socio-economic regulation with clear ownership foundations. These changes severely affected the field of labour relations and social policy. Instead of associative labour relations, the classical employer - employee relationship was re-established, marked by the conflict between capital and labour. From 1990 onwards, when the employment relationship again became bilateral, the employer was obliged to pay the employee a contractual wage. The wage was the cost that the employer had to pay first, before all other expenses. This was one of the key changes in the field of labour relations and social policy in 1991 in general. After independence and the establishment of our own state, the Slovenian social policy became state policy. Slovenia also became the subject of international labour law and embarked on the path of its own development of labour legislation on the basis of its own constitutional system.446 Newly established small companies with up to 50 employees were the most important source of net job creation and without the formation of this sector, with an open economy that forced large companies to rationalize employment, Slovenia would have extremely high unemployment. Since 1990, the active population decreased from 944,932 to 866,721. This decline was due to faster retirement, emigration, voluntary departure from the active population and an increase in the number of secondary school and university students. At the same time, the number of unemployed people rose from 55,441 to 119,799.447
7The Slovenian companies which had capable staff and the right business orientation managed to stay afloat. The question was whether, under the conditions of management, both in the country and in the world, they would follow technological development. The companies that did not have a long-term market orientation and were not oriented towards the world market, got into trouble or even went bankrupt in the new situation. A part of the failures of the Slovenian economy could be attributed to the long-lasting recession in the world, but the main causes must be sought for at home, and these were:
8In the conditions of economic recession, the number of employees in the economy decreased every year from 1987 to 1998 and the growth index of industrial production was decreasing, while the number of business entities increased significantly in the same period. This is evident from the review of business entities according to the uniform classification of activities. In 1990, there were a total of 83,565 business entities in the economy and non-economy, and in 1996 there were 134,881 of them. The largest increase was in the number of enterprises and companies. The number of enterprises and companies increased from 14,597 to 52,580, i.e. by more than three times (3.6 times). The number of companies increased even in the industry, which had severe difficulties. The number of enterprises and companies increased the most in the fields of finance, technical and business services, transport and communications, construction and trade.448 The starting point of the Slovenian economy differed from the economies in other countries, mainly in the larger share of companies established before 1990, a larger share of small companies, a strong private sector before privatization, a less important role of large companies with more than 5,000 employees and greater problems in restructuring.449 The Chamber of Craft and Small Business of Slovenia, the Chamber of Commerce of Slovenia and the Employment Service of Slovenia supported SMEs and entrepreneurship. After Slovenia gained independence, as mentioned, the state devoted most of its resources to rescuing certain large companies, while the state policy of promoting SMEs and entrepreneurship was quite changeable and indecisive. Formally, it supported the establishment of new companies, but what prevailed were the rehabilitation programmes for the former larger socially-owned companies, and the development of a stimulating support environment for SMEs was forgotten. The inconsistency of enterprise policy was also reflected in the constant changes in the economic sector, as the periods of the independence of the Ministry for Small Business and its inclusion in the framework of the wider ministry alternated. The SME development policy was inconsistent and improvised, which did not provide a permanent and predictable support for the small businesses. There was also a formal tightening of the conditions for establishing companies and a reduction in tax incentives for the registration of new companies, which led to stagnation in the creation of new businesses in the second half of the 1990s and deterioration of the entrepreneurial climate. The area of financial operations of companies was also characterized by disorderly legislation. The stagnation in the creation of new companies in the second half of the 1990s was certainly also the result of inconsistencies and indecision of state policy. The emergence of a large number of municipalities in the mid-1990s worsened the situation of entrepreneurship. The reason was the dispersion of development funds, which of course hindered the development of support infrastructure, especially for SMEs.450 In 1996, the first Small Business Development Strategy was prepared in Slovenia, which envisaged a series of measures to improve the business environment for SMEs. The content of this strategy was contained in the Strategy of the Republic of Slovenia for the Integration in the EU. In 2001, a new Strategy for the Development of SMEs and Entrepreneurship was developed. This strategy recognized entrepreneurship as playing a central role in ensuring development, introducing structural changes and improving the competitiveness of the Slovenian economy. The Strategy of Economic Development of Slovenia 2001-2006 also gave an important place to SMEs and entrepreneurship. The mentioned strategy also foresaw a number of measures that the state should take to improve the business sector. In 2002, by signing the so-called Maribor Declaration, the Government of the Republic of Slovenia recognized the importance of the principles of the European Charter for Small Enterprises and started implementing the Multiannual Programme for Enterprises and Entrepreneurship, especially for small and medium-sized companies in the period from 2001 to 2005. Slovenia was thereby equally included in the EU programmes for creating a stimulating business environment, in the network of Euro-Info Centres, the exchange of best practices between member states in the field of SME promotion and in the European financial programmes for promoting entrepreneurship and SMEs. After joining the EU, many opportunities in the field of entrepreneurship opened up in Slovenia. Among other things, it was able to draw on the funds of the European structural funds and other programmes supporting SMEs and entrepreneurship, and the EU also implemented activities to remove administrative barriers. The Ministry of the Economy thus tried to ensure a stimulating environment for the creation and development of small businesses with an anti-bureaucratic programme. In 2002, the said Ministry also published a Programme of Measures to Promote Entrepreneurship and Competitiveness for the Period 2002-2006. The programme of measures consisted of three sets: Knowledge for Development, Improving the Competitive Capabilities of Companies, and Promoting Entrepreneurship and Taking Advantage of Entrepreneurial Opportunities. In the period from 2001 to 2003, about 2,500 companies with about 150,000 employees in the market sector were included in the development programmes of the Ministry of the Economy. On average, approximately 5 billion Slovenian tolars were allocated for these programmes per year, which represented less than 0.5 percent of the budget. The Small Business Development Act, adopted in 1991, proved to be deficient in practice and inconsistent with the new economic reality. Thus, the Supportive Environment for Entrepreneurship Act451 was adopted in 2004, which was intended to remedy the shortcomings of the Small Business Development Act. From 2004 onwards, the Supportive Environment for Entrepreneurship Act served to guide business policy. Its main goal was to establish an entrepreneurial environment that would activate both human as well as material and financial resources for easy entry and successful growth of companies and optimal use of entrepreneurial and innovation potentials in Slovenia. The Act followed the guidelines of the European Charter for Small Enterprises and provided the basis for the use of funds from the structural funds. It also determined the establishment of a system of various institutions to support SMEs. We must also mention the Single Programming Document for the Period 2004-2006, published by the Government of the Republic of Slovenia at the end of 2003. In the first place among the priorities of this document was the promotion of the business sector and competitiveness, which, of course, pointed that the state was aware of the importance of the development of entrepreneurship for the acceleration of economic development.452
1The period after 1990 or the so-called transition period is also suggestively outlined by the title of Zvezdan Martič's documentary Where Did All the Factories Go (Kam so vse tovarne šle). The list of factories that went bankrupt in the late 1980s and after 1990 is very long. Prevent, Rog, Tam, Metalna, TVT Boris Kidrič, Mura, Tovarna sladkorja Ormož, Toper, Iskra Delta, Iskra, Tobačna Ljubljana and Industrija usnja Vrhnika (IUV) to name a few.453 Although they were virtually non-existent before 1989, the number of bankruptcies in that year, and especially in 1990 and 1991, greatly increased. The bankruptcies of companies were surely “the first and outwardly the most obvious and visible consequence of the shifts in the socio-economic system”.454 In the time of independent Slovenia, the Compulsory Composition, Bankruptcy and Liquidation Act was adopted as late as 1993455 (before that, the Act of the same name from December 1989 was in force). At the beginning of 1989, when the number of bankruptcies suddenly rose, the Rehabilitation and Termination of Organizations of Associated Labour Act,456 which had been adopted as early as 1986, was still in force. The change in the bankruptcy legislation itself did not affect the increase in the number of company bankruptcies. Entrepreneurial - microeconomic reasons in particular proved to be key factors in the bankruptcies of Slovenian companies; not because companies no longer operated rationally enough, but because at some point, overstaffing and operating costs became a crucial issue in such a large number of companies that bankruptcies became an inevitable consequence of the situation.457 On the other hand, the economic crisis, especially in 1991, and the stronger functioning of normal market selection intensified the process of dying out of failed companies. The number of bankruptcy applications filed by the Social Accounting Service (SDK) under the Financial Operations Act increased sharply.458 A bankruptcy is a socially undesirable phenomenon that causes damage to the economy, especially when it does not result in the redistribution of economic factors from less to more productive purposes, but in the termination of an entity and the destruction of factors of production, which means less socially productive assets, lower social product and fewer employees. Every bankruptcy means damage and every bankruptcy produces victims. The fundamental reason for bankruptcy, both in Slovenia and in most European legal systems, is a long-term insolvency of the debtor. In bankruptcy terms, insolvency is critical for a company and indicates a chronic, insolvent situation. A company finds itself in a situation where the basic value of assets is lower than its liabilities. In addition to the objective reasons for the commencement of bankruptcy proceedings, subjective reasons were also present in our practice, where companies themselves filed for bankruptcies.
2In individual cases, the companies' liabilities were so low that they in no way justified the decision to go bankrupt. As for socially undesirable phenomena in connection with bankruptcies, as much as 82 percent of all bankruptcies were declared in medium-sized and large companies. It should be noted that microeconomic reasons were one of the key factors for the bankruptcies of Slovenian companies. The question of ownership and how to become an owner was thus a fundamental concern of the management of socially-owned companies, which considered establishing such companies that would be controllable in a changed environment, primarily in terms of ownership and management. Changes in the socio-economic system also played an important role in corporate bankruptcies. Rapid transformations of the concepts of economic and political life, accompanied by fast changes in legislation or at least predictions of the latter, brought confusion, disorder and an unclear demarcation of what is allowed into society and especially into the economy, as well as opportunities and support for exploiting loopholes in the legislation. All of the above caused damage to the economy and consequently society, manifesting in different ways, for instance, in unemployment, reduction of productive social wealth, flight of creative intellectuals abroad, development of negative ethical and moral norms, increase of negative phenomena, as well as individual forms of crime.459
3From July 1991 to March 1993, 1,522 companies employing 125,698 workers met the conditions for instituting bankruptcy proceedings. These included 1,002 private companies with 2,306 workers. Such a number of companies cannot be liquidated or rearranged by any bankruptcy regime. The interventions that are necessary go beyond the framework and purposes of the bankruptcy regime, and their content must be sought in the reorganization of debt-creditor relations at the national economic level and in changes of relative prices.460 An overview of the establishment and termination of business entities in that period is highly interesting. In 1991, the largest number of business entities ceased to operate, namely 10,532. Then, in 1992, as many as 23,630 business entities were established. These data show a strong connection between the dissolution and establishment of business entities and the adoption of the Ownership Transformation of Companies Act, published on 11 November 1992, and the Companies Act, published on 10 June 1993.461
4The company Talum Kidričevo (the company renamed itself from Tovarna glinice in aluminija (The Factory of Alumina and Aluminium) - TGA Kidričevo to Talum Kidričevo in 1992), which plays an important role in the world of aluminium,462 struggled with numerous problems during the transition from one socio-political system to another. Shortly after the beginning of the mandate of the new Slovenian government in 1990, Danilo Toplek, the company's director, said the following about the relationship between the state and the company: “We have not had direct relations yet, as our government is only getting acquainted with the situation and leaders in individual companies. Certainly, the impact will be very important and present in such industries as the one in Kidričevo and similar infrastructure facilities. Although the Slovenian government claims that it will not interfere directly in the economy, I am convinced that it will realize sooner or later that this will be necessary in some areas.”463 The company's giro account was blocked several times and they managed to overcome the first blockade only on the 59th day. The reasons for serious problems and inability to pay lied mainly in the overestimated value of the dinar, problems due to repayment of domestic loans (the cause was interest, which ranged from 35 to 45%) and the price of electricity, which was greatly exaggerated in Slovenia. For comparison: in Germany, the price of electricity per ton of aluminium was 460 dollars, while in the Kidričevo company as much as 960 dollars!464 The director of the company, Danilo Toplek, pointed out the following about the crisis in which the company found itself during the transition period: “The aluminium industry in Slovenia is in crisis, which is the result of extremely deteriorated domestic economic conditions and the long-lasting low price on the world market!”465 The company was regularly visited by state officials, and there were more and more politicians who, despite their different party affiliations, were thinking in favour of this (around) 2,000-member strong workers' collective.466 The company overcame the crises, transformed into a joint-stock company in 1998 and is still extremely successful today.467 Perutnina Ptuj, one of the most important Slovenian companies in the food industry, also experienced a major crisis during the period of transition. Alojz Gojčič, former chairman of Perutnina's management board, said of the transitional crisis period: “If economic relations in Yugoslavia are severed, this means an extremely difficult situation for Perutnina. We need the Yugoslav market, we cannot survive without it. Perutnina has in fact always been a Slovenian, Yugoslav and global company. We export 20-30 percent of our production to Yugoslavia.”468 Perutnina's director Roman Glaser added: “As for the entire Slovenian economy, 1991 was a difficult year for Perutnina Ptuj as well. Our situation was affected by liquidity problems, the loss of the Yugoslav market, the fall of the standard of our customers and several other reasons. Nevertheless, Perutnina survived 1991 quite normally in both production and financial operations. Our account was never blocked.”469 Like Talum Kidričevo, Perutnina Ptuj also overcame the crisis period and the transition from one socio-political system to the other, transformed into a joint-stock company in 1997 and is still an extremely successful Slovenian company.470
5Even in December 1991, when the door to Slovenia's international recognition was already opening, the expectations of Slovenian directors were low and the fear was great. Especially in those companies affected by the Denationalization Act. The directors of successful Slovenian companies were not satisfied with the attitude of the authorities towards them. In a poll conducted in mid-December 1991, they pointed out that the government had given them only a “spark of hope and nothing more”. With the exception of those who had been building an export strategy for several years, they felt helpless, powerless, even as some sort of “whippersnappers”.471 This was because they were not familiar with the conditions of management in the future and because they did not know how the ownership transformation of their companies would turn out. They advised the government not to exhaust itself in political debates, but rather to engage in “practical work”. Even the most successful directors, such as Krka's director Miloš Kovačič, felt too “distanced” from political decisions; they were not “taken seriously” by the politics, which was also not interested in their experience of “setting up a successful economic strategy”.472 Despite initial difficulties and pessimism, Krka also managed to overcome the transition crisis. Krka's ownership transformation process was completed in December 1996, when it was registered as a joint-stock company. It thereby came into the ownership of 75,000 shareholders and is one of the largest joint-stock companies in Slovenia. Let us mention another successful international company based in Velenje - Gorenje d. d. The restructuring and ownership transformation of this company took place in 1991-1996. Although severely affected by the loss of the Yugoslav market, it was setting up companies abroad during this period, especially in Eastern Europe: the Czech Republic, Hungary, Poland, Bulgaria and Slovakia, which was an extremely wise move. Already in the 1980s, the company expanded to both the United Kingdom and the United States. In 1997, Gorenje became a joint-stock company. After that, it slowly began to return to the markets of the former Yugoslavia. The company thus successfully survived transition and is today considered the largest Slovenian manufacturer of household appliances, furniture, ceramics, water heaters, air conditioners and other household products and is also one of the largest Slovenian exporters.473 However, not all Slovenian companies overcame the transition crisis. Many were liquidated or met the conditions for bankruptcy. In the post-independence period, entrepreneurs mainly lacked a stimulating supportive environment for the establishment of companies, and the development of the economy was negatively affected by the reduction of tax incentives for the registration of new companies and the disorder in financial legislation. Economic policy did not follow the needs of small business development, as Slovenia received the Small Business Development Strategy as late as 1996.474
1As already mentioned, the Ownership Transformation of Companies Act initiated mass privatization of companies. Based on this Act, the managements of companies (except public companies, companies with forests, cooperatives, banks, insurance companies, casinos, bankrupt companies and some other minor exceptions) chose the method of transformation by themselves, while the Agency of the Republic of Slovenia for Restructuring and Privatization supervised the process through the issuance of consents. With the first consent, the Agency confirmed the company's orientation regarding economic goals and interests, while the second consent meant the confirmation of legal instruments and methods of privatization within the law.475 In Slovenia, a decentralized and autonomous ownership transformation was thus taking place, which means that companies themselves decided on the method and implementation of ownership transformation. The process of ownership transformation took six years. In addition to the ownership transformation itself, Slovenia was solving a number of other issues within the process. The length of the process was most affected by audits of illegal privatizations and the return of confiscated property. Some other problems (agricultural reform, harmonization of accounting and financial standards, reorganization of the legal system, etc.) were addressed as well, additionally slowing down the transformation.476
2Jože Mencinger wrote in 2006 that the somewhat specific process of transitional privatization in Slovenia can be divided into three periods. According to him, the mass privatization in the early nineties was marked by the legacy of the socialist understanding of property and self-government, which were the foundations of the Yugoslav economic system. A fairly predictable outcome of the privatization process was an unstable ownership structure composed of internal owners, private and state financial institutions, and a small share of foreign owners. A significant part of the economy remained in direct state ownership. Formal privatization was followed by a slow consolidation of the ownership structure, which at the same time offered the possibility of political interference. According to Mencinger, the governments did not make extensive use of this option until 2004, but were using it discreetly, while “the newly elected government in 2004, in addition to its neoliberal rhetoric about the state's withdrawal from the economy, made extensive use of this option”.477 It should be noted that this government announced a new period of privatization and the withdrawal of the state from the economy. How it actually tackled this is, of course, a different question. The fact is that during the mandate of this government, a new face of Slovenian privatization, or in other words, of the Slovenian version of capitalism, appeared.
3Companies were allowed to autonomously prepare privatization programmes until the end of 1994 and send them to the government's Agency for Restructuring and Privatization for approval. By 31 July 1998, 1,436 companies with a total opening balance of SIT 1,148.3 billion had received the first consents for the programme, of which SIT 784.7 billion was socially-owned capital. 114 companies were transferred to the Development Fund or the later Slovenian Development Corporation (SRD), and 57 of them were liquidated or met the conditions for bankruptcy proceedings. By 1999, 1,381 companies had completed the ownership transformation by obtaining a second consent (for the entry in the register of companies), 141 companies had been transferred to the SRD, while bankruptcy or liquidation proceedings had been initiated in 82 companies. The length of the process was greatly influenced by the resolution of a number of transition problems.478
4In the total capital structure of companies privatized under the Ownership Transformation of Companies Act, the ownership of internal owners accounted for 27 percent, of authorized investment companies 17 percent, state funds 15 percent, buyers from public sales 9 percent, with 32 percent remaining (the vast majority of the remainder belonged to the state, and some to the old owners, cooperatives and denationalization beneficiaries). Internal owners predominated in smaller, labour-intensive companies. The concept of privatization of companies did not give such an important role to non-residents as in some other transition countries. Companies did not receive fresh capital from abroad, and non-residents deposited their direct investments before establishing the ownership structure. The privatization process also affected general economic activity, the investment trend and the formation of additional production capital. The completion of the process thus freed up retained investments and increased the profitability and efficiency of companies.
5The Act Concluding Ownership Transformation and Privatization of Legal Entities Owned by the Development Corporation of Slovenia479 entered into force in the beginning of May 1998, which determined the transition from decentralized to centralized form of privatization. This form of privatization affected companies that had not been able to transform their ownership on their own, but it should be noted that in the six-year process, ownership transformation had been carried out by almost all companies with socially- owned capital. Only a small number of companies did not carry out privatization under the Ownership Transformation of Companies Act due to their own inactivity or other objective reasons. With the ownership transformation of Slovenian companies with socially-owned capital, part of the transformation of the economy was concluded in 1999. The process was highly important as it changed all aspects of the Slovenian economy and the attitude of the general public towards capital and market orientation. The ownership transformation of companies helped to create efficiently managed and market-oriented companies. With the conclusion of this process, the first part of the transition process was completed, the purpose of which was to include Slovenia in the general global trends and economic flows as well as in the integration processes of Europe. In the process that lasted six years, a number of legal, financial, institutional and, last but not least, theoretical and moral dilemmas were being resolved. In addition to the ownership transformation, financial and organizational restructuring was also carried out. The process helped to settle a number of problems, such as the return of confiscated property to beneficiaries, agricultural reform and legal regulation of agricultural land ownership, harmonization of accounting standards and more.
6The Slovenian privatization model did not bring fresh capital from foreign investors and the length of the process was the result of many transition problems. With the conclusion of the process, a new investment cycle was triggered, increasing economic growth and employment. The share of foreign investments also increased. After the formal end of the process of ownership transformation of companies, it was necessary to complete the second part of the transition process, namely the privatization of state property.480 The economist Maks Tajnikar determined at the end of 1999 that most of the large systems that had remained state-owned and had not been transformed were still half under socialism, and he wondered how they even managed to survive more than an eight-year period with huge losses.481 According to the Act Amending the Companies Act482 of 2001, which regulated the rights and obligations of economic operators, companies were divided into small, medium-sized and large. This division depended on the average number of employees in the last financial year, net turnover in the last financial year and the value of assets at the end of the financial year.483
7The process of privatization as an abolition of socially-owned property was followed by the privatization of 2,000 billion Slovenian tolars worth of state property. In the following years, acts were passed on the privatization of insurance companies, state-owned banks, some state-owned companies (transport infrastructure, telecommunications, energy system) and other public services.484 The sale of state-owned property, in which the parastatal funds Kad (Pension Fund Management) and Sod (Slovenian Compensation Company) played a decisive role, was non-transparent in several cases and represents another manner in which certain individuals acquired property under favourable conditions. In July 2008, the National Assembly of the Republic of Slovenia discussed the report by the commission of inquiry establishing the liability of public officials in connection with damage to state property in the sale of state-owned shares of Kad and Sod in companies before 2005. The report states that in the period 1995-2005, 2,447 ownership shares of Kad and Sod were sold, mostly without public bidding. In the period 2006-2007, about 200 ownership shares of the mentioned state funds were sold through public bidding. The majority of capital shares in the period 1995-2005 was therefore sold in a non-transparent, nonpublic manner, thus preventing the competitiveness of bidders. It is also clear that these shares were mostly sold below their price. Mass non-transparent sale of state property is certainly another form of wild privatization.485 The Ownership Transformation of Companies Act determined the verification of the legality and regularity of already performed ownership transformations in companies that in any way transformed their status, reorganized themselves, transferred socially-owned capital free of charge, established or invested in new companies or transferred individual business functions to other companies in the period from 1 January 1990 until the entry into force of this Act. The verification took place if there was a reasonable suspicion that the said acts or transactions caused damage or if a request for the initiation of an audit procedure was made by an authorized body in a timely manner.486 As far as the methods of eliminating damage to socially-owned property are concerned, the Social Attorney of the Republic of Slovenia gave priority to solutions that established the nominated social capital owned by the parent company on 31 December 1992 (elimination of by-pass companies), to payment of profit, payment of purchase price, return of benefits from management contracts to socially-owned capital if premiums were paid from socially-owned capital, changes of preference shares for socially-owned capital into ordinary shares and to increasing of socially-owned capital.487 In the audit procedures performed for the period from 1 January 1993 to 31 July 2004, the Agency of the Republic of Slovenia for the Audit of the Ownership Transformation of Companies established that under Article 48a of the Ownership Transformation of Companies Act damage was incurred to socially-owned property in the amount of 8,820 million Slovenian tolars. Pursuant to Article 48 of the Ownership Transformation of Companies Act, there was damage to socially-owned property in the amount of 9,358 million Slovenian tolars. Pursuant to Articles 48 and 48a, damage was incurred to socially-owned property or assets in the amount of SIT 18,178 million in the period from 1 January 1993 to 31 July 2004, which is much less than in the period until the end of 1992. The greatest abuses included the conclusion of harmful contracts, the establishment of by-pass companies, unjustified write-offs of claims and the reduction of companies' assets.488 According to the audit, in the period from 1 January 1990 to 31 July 2004, socially-owned property was damaged in the amount of 104,352 million Slovenian tolars. As already mentioned, the greatest damage to socially-owned property was caused in the period prior to the adoption of the Ownership Transformation of Companies Act. After the adoption of the said Act, the following institutions oversaw the process of ownership transformation: the Agency of the Republic of Slovenia for Restructuring and Privatization, the Ministry of Economic Relations and Development, the Government of the Republic of Slovenia and the National Assembly of the Republic of Slovenia. The Agency of the Republic of Slovenia for Restructuring and Privatization supervised the transformation procedures and ensured their legality. As part of its public authority, the aforementioned Agency also issued documents (consents) and resolved complaints. In addition to the Agency, the Ministry of Economic Relations and Development was also responsible for supervising the ownership transformation process. The latter also participated in the preparation of legal acts and secondary regulations for this area and for keeping a central record of the ownership certificate accounts. Decisions of the Agency could also be appealed at the mentioned Ministry.
8Pursuant to the provisions of the Agency of the Republic of Slovenia for Restructuring and Privatization Act,489 the Council of the Agency and the Supervisory Board of the Agency were also responsible for monitoring the Agency's professional work and operations. In addition to the Director of the Agency, the government also appointed the President and members of the Agency's Council. Its responsibilities included, inter alia, the financial plan of the Agency and the consideration and approval of the final account and the report on the work of the Agency. In addition, the government also decided on the transfer of socially-owned capital to the ownership and management of the Slovenian Development Corporation. The process of ownership transformation was also overseen by the National Assembly of the Republic of Slovenia, which appointed a nine-member Supervisory Board of the Agency and in 1992 the Commission for Monitoring of the Ownership Transformation and Privatization, chaired by Izidor Rejc. The Commission monitored and supervised the ownership transformation of companies and the adoption of legislation in this area. An important factor in the ownership transformation was the openness of the privatization process of individual companies and the proper informing of the public. In this manner, all beneficiaries were given the opportunity to participate in the ownership transformation process. A company had to publicly disclose the approved programme within 30 days in the Official Gazette of the Republic of Slovenia and in one of the daily newspapers. It also had to inform employees, creditors whom it owed more than ECU 100,000490 and denationalisation beneficiaries. In addition, the Agency informed the important media once a week about the issued consents for the entry of companies in the register of companies.491
1The Ownership Transformation of Companies Act, which was the central document of privatization legislation, was amended twice more in 1993. Privatization leaves consequences on many levels of management. They can be positive and desirable or less favourable and causing new imbalances.492 In Slovenia, through the process of transition and a new method of regulation, privatization was reflected, among other things, in the re-establishment of a market-oriented economic order. The privatization process itself deepened the economic stagnation into a “transformation crisis”, as it increased uncertainty. The end of privatization contributed to the release of previously held investments. Namely, investments increased by 16 percent, but, consequently, gross domestic product also grew by 0.9 percent. There was also an increase in foreign direct investments by 1.8 percent. Simultaneously, foreign debt borrowing decreased by 0.6 percent.493 Opinions about the effects of privatization on corruption differ widely. Some studies have shown that privatization causes the closures of companies. Less information on costs and performance indicators is available to the public in privatized companies. The academician and sociologist Veljko Rus wrote that “this makes privatization of public companies or institutions undemocratic in itself and dangerous for society, as it increases the influence of managers and reduces the influence of the public”, adding that “the leading businessmen have an increasing influence on politics and are becoming illegitimate co-creators of politics with their donations to political parties”. Rus also believes that market logic and profit are thus pushing the public interests into the background and that these are not merely assumptions, but empirically proven facts, which also confirm that there is a negative correlation between privatization and access to information as well as a negative correlation between privatization and social responsibility of managers. We could thus conclude that corruption is an inevitable consequence of privatization, but this is not the case. “Corruption is not an economic, but primarily a political problem”, Rus said.494
2Privatization created new business owners who can be classified into two major groups, namely internal and external owners. The first group included those shareholders who were employed in the company (workers and managers), their relatives and former employees. The second group consisted of state privatization funds, authorized investment companies, banks, the state, companies and small shareholders.495 Owners of privatized companies can be mainly divided into the following groups:
3In Slovenia, privatization influenced the creation of three typical groups of companies: public, internal and external companies. Public companies were listed on the stock exchange, while internal and external companies were not. The difference between internal and external companies was that, unlike in external companies, the owners acquired a majority share in internal companies.497 According to the data, a relatively concentrated ownership structure in companies was established in Slovenia after the beginning of privatization - on average, the largest five shareholders controlled about 50 percent of the capital in all companies, which is generally favourable for establishing effective corporate governance. The problem was that there were no strategic owners among these large shareholders. Two parastatal funds and authorized investment companies acted as large shareholders in all companies. Particularly authorized investment companies often pursued their specific interests in the management of companies, arising from the primary activities of the founders of management companies (such as banking and insurance). Due to the institutional reasons, such as the structure of commissions and rewards, transformation rules and privatization gap, their ability and motivation to effectively manage companies was questionable as well.498 At the end of 1999, the concentration of ownership in all companies from distributive privatization was relatively high. On average, the five largest owners held 61.5 percent of the vote in all companies. For the companies privatized as public, the share controlled by the five largest owners was the lowest, but it still stood at 56.3 percent of the vote. For the companies wishing to remain on the stock market in the long run, such high levels of ownership concentration may have been controversial in terms of ensuring equal rights for large and small shareholders. As expected, the number of shareholders declined the fastest in public companies, as already at the very beginning of privatization many citizens entered these companies in order to sell their shares as soon as possible. In addition, the sale of shares on the stock exchange is simpler and more transparent than the sale of shares in internal and external companies that are not listed on the stock exchange. Interestingly, the concentration of ownership in internal companies at the end of 1999 came quite close to the concentration of ownership in external companies.499
4The realization (method of privatization) was and still is the subject of much debate, particularly in terms of whether it was carried out optimally, what were the shortcomings and the like. Certain Slovenian politicians have interesting opinions about this. Miran Potrč, who was active in politics already in the previous system and has been a member of the National Assembly of the Republic of Slovenia since 1992, pointed out the following about how Slovenia transformed socially-owned property into private: “We were transforming it piece by piece so there was a possibility to get a significant part of the capital in a company in a relatively cheap way and this money is not in the pocket, in the wallets ... it is in the shares.”500 President of the National Assembly of the Republic of Slovenia in 1990-1992 and one of the leading figures of the Slovenian independence process, France Bučar, who was a member of the National Assembly of the Republic of Slovenia even after 1992, said the following about the privatization process: “Politics simply could not cope with this process. The rich did not fall from the sky. Politics did nothing to intervene with its measures to prevent that.” He added that it is easy to point fingers and place blame on others and talk about how certain people were stealing socially-owned property. The fact is, according to him, that neither politics nor the experts were able to face the situation and some just took advantage of it.501 That politics (at least part of it) did not handle the situation is also evidenced by the sentence uttered at one of the sessions by Demos' government minister Dimitrij Rupel: “Given the mood in Demos, privatization laws will be passed, perhaps with minor amendments. However, as has been said, this is not the point.” The minister did have to leave the hall, but he certainly radiated, as Neven Borak wrote, “incredible and politically unforgivable naivety.”502 Dimitrij Rupel, chairman of the Republic Committee for International Cooperation in the Demos government and then the Minister of Foreign Affairs of the Republic of Slovenia in almost all subsequent Slovenian governments, said that the large assets of certain individuals were the result of large loans they received from banks. According to him, the money was only in banks and some former communist institutions, while loans were granted to them because of their acquaintances. He also believed that some people also got loans “on the basis of nothing”, from which they subsequently created “empires”. Rupel mentions the so-called “Old Boys Network”,503 but in his opinion, Slovenia was nevertheless not like Hungary, where foreigners bought up large companies.504
5Since gaining independence until recently, workers' participation in Slovenia was associated mainly with various forms of participation in management. The basis for this was the Workers' Participation in Management Act (ZSDU),505 which was adopted in 1993, but was issued as an official consolidated text as late as 2007.506 The possibility of employee participation in profits was envisaged even before the amendment to the Employment Relationships Act (ZDR),507 but only on a declarative level. With the adoption of the Employee Participation in Profit Sharing Act (ZUDDob),508 the notion of workers' participation was extended to financial participation, which includes both employees' participation in profits and employees' ownership. Only with the entry into force of the Employee Participation in Profit Sharing Act was the participation of employees in profits subject to tax relief, but only on condition that the profit participation agreement was validly concluded, that it met all legally prescribed components and that the registration was performed at the Ministry of the Economy. Pursuant to Article 21 of the Employee Participation in Profit Sharing Act, the Ministry of the Economy entered the approved agreements in a special register, in which the following was entered: company name and head office, date of entry in the register, number of decision of the entry in the register, scheme, date of agreement conclusion and first profit distribution.509 Both formal and material conditions had to be met for employees' participation in profits. One of the conditions was that the possibility of such participation had to be provided for in the company's statute or articles of association. A further formal condition for employees' participation in profits was the conclusion of an agreement on employee participation in profits, which was decided on the part of the company by the general meeting with a simple majority in concluding the represented share capital. The resolution of the general meeting had to include an authorization for the management to conclude the agreement. The participation of employees in the profit, of course, ultimately required a profit, and the term “profit” refers to the net profit for the accounting period, as determined by the law governing companies. The initiative to conclude the agreement could be given by either the company or the workers. On the part of the workers, the initiative could be given by a representative trade union in the company, the workers' council or the union steward or one or more workers' representatives appointed by the workers at the workers' assembly. The agreement was concluded when it was signed by authorized persons and was used for the next financial year, counting from the day of conclusion.510 An effective system of financial participation certainly has a positive effect on job satisfaction, greater motivation and, above all, on strengthening the sense of belonging to the company, so the Employee Participation in Profit Sharing Act, adopted in 2008, certainly marks a positive shift in this area. However, we must be aware of the essence of private property; the state can intervene and regulate matters where it is a co-owner or owner, but it should not influence companies and the distribution of profits in companies that are entirely privately owned. In such companies, this should be a decision of individual owners, otherwise it would be a gross encroachment on the autonomy of private companies.511 It is too early to predict what results the Employee Participation in Profit Sharing Act will bring in practice. Time will certainly tell, but the data provided by the author of the article entitled Distribution of Profits to Workers (Delitev dobička delavcem), published in January 2009, speaks for itself. In the article, we read that by 5 December 2008, the Ministry of the Economy had received only six requests for the registration of agreements on employees' participation in profits. By 23 December 2008, eight profit participation agreements had been registered. The subject of three agreements was the first profit-sharing for the 2008 financial year and the subject of five agreements the first profit-sharing for the 2009 financial year.512 The privatization method was well-intended and allowed for high involvement of workers and employees in ownership transformation. The extent of employee ownership in Slovenia is very difficult to estimate because neither companies nor institutions systematically collect data on this. The results of analyses on smaller samples of companies show that share ownership in Slovenia is concentrated and that profits are distributed among a handful of people in companies - the management, of course.513
6After Slovenia's accession to the EU, the sale of Mercator resonated strongly with the public, which is also responsible for the fact that at the end of 2007, the word tycoon found its place in the Slovenian vocabulary. The number of managerial takeovers increased after 2004 and peaked in 2007, when 35 takeover permits were issued.514 What is striking is the fact that most of them were carried out through loans and at the expense of the depletion of companies that were taken over - the Takeovers Act from 1997515 did not explicitly prohibit the takeover of a company by pledging the target company's assets. Managerial takeovers were also a very convenient solution for reducing the impact of politics in companies, given the favourable economic conditions in the period 2005-2005, favourable legislation and approved high bank loans, among other things.
1The economic crisis also shook the usual business models of corporate management and there was a lot of talk about employees taking on an increasingly larger role. Even examples of good practice are known, namely the companies Domel and M Tom. The Domel company stands out in the Slovenian space, although the result of ownership transformation or privatization is actually such as the Slovenian privatization method enabled. The latter allowed for a high involvement of employees in the privatization process, but over the years, the ownership structure was changing - especially in favour of managers and investment companies, while employees (without the management) were losing in this structure. In this respect, Domel is a big exception and today, given the results that the company is achieving, it has obviously decided on the right path. As far as is known, workers played a key role in this. After leaving Iskra and changing its name to Domel, the company focused entirely on exports. In 1996, the privatization process was completed and Domel was immediately a target of the takeover by an American multinational, which was not carried out mainly thanks to the employees. In fact, the latter resisted, organized themselves and founded an association of shareholders - later the authorized company Domel Holding, which raised so much capital that it represented a majority share. Domel Holding is owned by just over 1,200 shareholders, mostly employees, former employees and retirees. Domel produces various types of electric motors, blowers and pumps, centrifugal fans, motors with external rotor, tools and components. Even in times of potential trouble or crisis, the company always responded in such a way that employees did not feel any major consequences. It was not difficult for them to agree that there would be no layoffs, to change their work schedule, lower the wages and the like. What we have in front of us is an example of a company that proves that such a form of ownership structure can obviously be successful in today's system. This is reminiscent of the words of the legendary economist Aleksander Bajt, who proposed the establishment of such a system, according to which a wide variety of companies would compete on the market - from state, private, shareholder and self-governing companies. The market would then show what sort of companies would thrive best. Bajt argued that “the form of ownership is not the most important thing for production at all, as it is possible to produce even without private property” and that it would be much more useful for “socially- owned enterprises to become completely independent and be left to themselves, the workers and the managers” instead of being exhausted by privatization. An example of similar good practice can also be observed in the M Tom company. After the company went bankrupt, they decided to transform it. The company was revived by former employees of the bankrupt company Tom, who even managed to buy out the production hall of the former company. One of the interesting things about M Tom is that in addition to operating successfully, all employees, including the director, have the same wages. In an interview with Dnevnik in 2015, the company director Damjan Burger said, among other things, that the manner in which they operate is the only right one when you start from scratch and that “the industry should become primary in the country, instead of searching for ways to take even more from the people”.516
2At this point, it is necessary to emphasize the role and importance of trade unions. Globalization and modern times have also affected the functioning of the latter. The role of trade unions in the 21st century has changed. Trade unions are increasingly losing their bargaining power as their membership continues to decline. Especially among the younger population. If the level of trade unionism was very high in the post-independence period, in recent years, both in Slovenia and in most European countries, there has been a noticeable trend of declining trade union membership. Membership in industrial unions is also falling due to factory closures and job losses. If 80,000 people were once employed in construction, there are 50,000 today; there were 100,000 people working in the textile industry, now only 20,000. Meanwhile, for the same reasons, union membership in the public sector is strengthening. In modern times, unions face accusations of being outdated, not keeping pace with the changes and being unnecessary. In any case, major changes in the labour market, crises and general social changes also dictate certain changes in the trade union movement.517
1In Serbia, economic issues were in the background even after the end of the war due to numerous political and other international pressures (Kosovo, the Hague, Montenegro, etc.). After a sharp drop in economic activity and hyperinflation in the early 1990s, the assassination of Prime Minister Zoran Đinđić in March 2003 also played an important role in the stagnation of reforms. The latter was working relentlessly to implement changes, for which he paid with his life. Following the changes in the political arena on 5 October 2000 (the fall of Slobodan Miloševic), measures against the Federal Republic of Yugoslavia were withdrawn and the door was opened for its integration into international political and economic unions. Transition officially began in Serbia at the end of 2000 or with the year 2001. One of the basic transition laws in Serbia is the Privatization Act of 2001, which was based on the method of sale. It provided for the sale of a 70% share of companies' capital and the free distribution of the remaining share to either employees or all citizens. The aim of such a privatization method was to find good strategic investors who would own a majority share and thus have an opportunity to control the management and ensure good management of companies. By the beginning of 2005, 1,384 companies had been privatized. The economist Danijel Cvjeticanin believes that subordinating the economy to politics was the greatest obstacle to economic development, the market system and the competitiveness of the Serbian economy. “Foreign strategic partners have shown interest in numerous companies and they want to participate in their recapitalization. Economic reforms are currently under way that will change economic conditions and provide additional sources of funding. All the steps that have been taken so far (repayment of existing internal and external debts, provision of funds for the imports of energy products and especially activities in the implementation of privatization) and which will be taken in the future will help the industry gradually recover and adapt to new economic conditions.”518
2Similarly as in Serbia, economic development and transformation in Croatia were strongly influenced by the war as well. Despite the war conditions, however, the country undertook structural changes, rehabilitation and privatization of the economy. In 1995, the stabilization of the economy was successful. Inflation fell to 3.7 percent, while the exchange rate of the domestic currency (kuna) rose by half less. The main stabilizing factors were restrictive monetary and fiscal policy and the corresponding exchange rate policy of the strong kuna. In 1995, Croatia was granted loans in the amount of $ 400 million by the World Bank and the European Bank for Reconstruction and Development. The main systemic plans for 1996 included the reform of banks, the continuation of privatization, the construction of transport routes and the renewal of tourism in the Adriatic (which generated inflow in the amount of $ 1 billion in 1995 and $ 6 billion before the war). The privatization process in Croatia formally began in 1990 with the adoption of the Act on the Agency for Restructuring and Development and the Croatian Development Fund Act. The two institutions were tasked with leading the privatization process. After 1995, the privatization process stalled. In addition to the war, there were other reasons. The coupon privatization, for instance, which was supposed to speed up privatization, thus began in early 1998, mainly due to administrative problems. In Croatia, a special phase of privatization - mass privatization - was initiated by the Privatization Investment Funds Act, based on free distribution to people who were in one way or another connected with the war (war invalids, families of war victims, exiles or returned refugees, former political prisoners, etc.). These numbered about 350,000 people; 240,000 victims of war were involved in the coupon privatization alone, to whom shares in the amount of 2.65 billion Deutschmarks were distributed free of charge.519
3The choice of the method of privatization certainly influenced what the employees gained from the privatization process and how much. The Czech Republic, Hungary, Poland and Slovenia are countries that used completely different models of privatization and carried them out at different levels. These countries can be compared in the relation between distributive, i.e. “coupon privatization”, and classical forms of privatization. Hungary stood out, as it was the only one of the mentioned countries to use almost exclusively classical methods and where only a small part of privatization was of a distributive nature, namely in cases which involved denationalisation and war reparations or compensations due to the operation of the former socio-political system. In the Czech Republic, “coupon privatization” prevailed, in the framework of which companies decided for themselves how to combine it with classical methods. The Czech Republic and Poland were characterized by the fact that many, especially large business systems, had been transformed even before they were privatized, which increased their efficiency. In the Czech Republic, the so- called “small privatization”, which is unknown in Slovenia, was also successful. This involved the privatization of small facilities. After the transformation of companies, the Czechs privatized non-business parts, such as restaurants. In such companies, there were no problems with control because these facilities were purchased by managers. Investment companies also played an important role in the Czech Republic. They collected about 70 percent of the certificates, which is about as much as in Slovenia. There were about 400 of these funds in the Czech Republic, but 50 percent of all certificates obtained by all funds were collected by the thirteen largest investment companies, which then set up state banks and state insurance companies. In the Czech Republic, banks were also involved in the “coupon privatization”, which caused problems in the ownership relations. According to the Czech legislation, one or more funds managed by the same management company could own maximally 20% of the same company, while on the other hand, several funds could own the entire company. The ownership structure of companies was thus highly dependent on auctions, so many companies in the Czech Republic had a very diversified ownership structure - with a few funds, with one fund and the like.520
| Country | Predominant method of privatization | Scope of benefits for employees |
| Czech Republic | Privatization with certificates (coupons) | A great deal of benefits; in the end, privatization funds played an important role |
| Hungary | First attempted sale, then decentralized | A great deal (especially from 1992 onwards, when ESOP legislation was adopted) |
| Poland | First attempted sale, then privatization with liquidation and certificates | A great deal in liquidation, little in certificates |
| Slovenia | Compromise, privatization with certificates | A great deal, in the end, privatization funds played an important role |
4Like Hungary and, in part, Slovenia, the Polish democratic government first proposed privatization methods that were not particularly favourable for employees, but later had to give in to pressure and agree to compromises. The share intended for employees in “certificate privatization” was smaller than in Slovenia, but the alternative technique - privatization through liquidation - enabled a cheap establishment of internal ownership.521 As Andreja Böhm pointed out in an interview with the newspaper Agens, Polish privatization was state-run, and they knew different privatization methods. The privatization of bankrupt companies was particularly successful. In these cases, new companies were set up, most of which were owned by workers. These companies became “lessees” for the companies' assets. It should be noted that these cases were not classic forms of bankruptcy. Bankruptcies were carried out regardless of the business performance of the companies, with which they avoided the establishment of companies under the new laws and the like. Smaller companies were formed and workers bought them by renting. There were only a few cases with external or foreign owners. The advantage of this sort of privatization was also that it was fast, the companies mostly operated well and there were no problems with control. In Poland, medium-sized and large companies were subject to capital, i.e. classic privatization. The Poles lagged behind the most in this area. Initially, they counted approximately 8,000 state-owned companies, with about 5,000 expected to be privatized, while 1,200 were privatized through bankruptcy. Among other companies, not even 200 were privatized. This type of privatization mainly included direct sales to foreigners or strategic owners. The Poles initially sold many good companies through public offerings of shares. In this manner, they established their capital market. The shares of such companies were also sold in instalments and as a result, the state was still among the largest owners on the stock exchange. At the beginning of the privatization process, Poland was an example of mass privatization, but “coupon privatization” could not go through. Namely, the parliament did not pass the relevant law for a very long time, so Poland was among the last to start with the “coupon privatization”. This did not occur until 1996 and even then, only 512 companies were involved in privatization. In addition to the aforementioned 200 companies, the companies from the “coupon privatization”, which was carried out in an almost centrally planned manner, are also important, as the state, which gave them strategic owners, prescribed exactly what the ownership structure of these companies would be. It also sponsored the establishment of funds, selected managers for them and prescribed the distribution of capital by individual companies. Funds in Poland were initially state-owned, then privatized, and so people could not invest their certificates in companies, but only in funds. In 1997, the Polish Ministry of Privatization was transformed into the Ministry of State Property, and all hitherto unsuccessfully privatized companies fell under its jurisdiction.
| YEAR | SVN | CZE | HUN | POL |
| 1990 | 15 | 10 | 25 | 30 |
| 1991 | 20 | 15 | 30 | 40 |
| 1992 | 30 | 30 | 40 | 45 |
| 1993 | 40 | 45 | 50 | 50 |
| 1994 | 45 | 65 | 55 | 55 |
| 1995 | 50 | 70 | 60 | 60 |
| 1996 | 55 | 75 | 70 | 60 |
| 1997 | 60 | 75 | 75 | 65 |
| 1998 | 60 | 75 | 80 | 65 |
| 1999 | 60 | 80 | 80 | 65 |
| 2000 | 65 | 80 | 80 | 70 |
| 2001 | 65 | 80 | 80 | 75 |
| 2002 | 65 | 80 | 80 | 75 |
| 2003 | 65 | 80 | 80 | 75 |
| 2004 | 65 | 80 | 80 | 75 |
5The case of Hungary is also a special story, where experts soon began to warn that foreigners had bought too many companies. This is only partially true: by bringing in strategic owners, the Hungarians managed to create an ownership structure that suited the companies. Hungary had the most foreign investments per capita, as privatization created a very friendly environment for foreign investors. They sold their companies to them in such a way that foreign investors had to guarantee for their investments in these companies at the time of purchase, i.e. with contracts. Privatization was thus a sort of lever for the transformation of companies. The Hungarian privatized companies were certainly the most successful in the 1990s and later, although this transformation was very grave and painful for the people due to job losses and bankruptcies, but “this needs to be cleared up, as foreign strategic investors also brought management knowledge and technology with them”.522 Compared to the similar post-socialist states, the peculiarities of Slovenian distributive privatization were especially the following two: it did not directly enable the entry of strategic owners (especially not foreign ones) and it had a relatively large remaining indirect state ownership in all privatized companies through two state funds.523 Although foreigners participated in privatization, in Slovenia, the desire to acquire foreign capital was lower than in other socialist economies. The main reasons were the openness to the world, much wealthier population and the compromise privatization model, which led to a large number of companies with majority internal ownership. On the other hand, there was also less interest from foreign investors, mainly due to the smallness of Slovenian market, the relatively high standard of living and the corresponding wages and labour costs.524 In fact, the privatization of socially-owned property was the central and biggest problem in all transition states. At the time, the authorities in all those countries were facing a great challenge, as choosing the appropriate privatization method was anything but simple.
235. We know privatization not only in the transition from socialist to market economies, but also in capitalist economies. In the latter, privatization occurs for a variety of reasons: for the state to obtain financial resources by selling the state property, for the state to get rid of loss-making state-owned companies, etc., all of which are linked to the realization that the pursuit of economic activities based on private property is more efficient. The capitalist economies are also familiar with the process of nationalization. This is often linked to political change (Great Britain after the Second World War), but often the state wants to ensure its key role in the economy through the nationalization of individual industries (most often the nationalization of companies that formally generate a small share of social product and industries that are crucial in economic infrastructure (transport)). More in: Mencinger, Gospodarski sistem in politika Slovenije [Slovenian Economic System and Policy], p. 50.
236. Mencinger, Deset let pozneje [Ten Years After], p. 29.
237. Ibid., pp. 29-30.
238. Eatwell, John et al., Brglez, Milan (trans.). Iz tranzicije v evropsko povezovanje, Oblikovanje prihodnosti srednje in vzhodne Evrope [Transformation and Integration: Shaping the Future of Central and Eastern Europe]. Ljubljana: Sophia Collection, Science and Journalism Centre, 1996, p. 176.
239. Bannock, Graham et al. Dictionary of Economics. London: The Economist: Profile Books, 2003.
240. Žnidaršič Kranjc, Alenka. Investicijski skladi v Sloveniji - (ne)uspeh in za koga [Investment Funds in Slovenia - (Un)Success and for Whom]. Postojna: Dej, 1999 (Hereinafter: Žnidaršič Kranjc, Investicijski skladi v Sloveniji [Investment Funds in Slovenia]), p. 44.
241. Ribnikar, Ivan. Odprava družbene lastnine podjetij, privatizacija ... [Abolition of Socially- Owned Property of Companies, Privatization ..]. Bančni vestnik [Banking Journal], Vol. 47, No. 1/2, Jan.-Feb. 1998, pp. 60-62.
242. Agens, No. 1, September 1993, p. 1.
243. Official Gazette of the Republic of Slovenia, 18/1991.
244. Official Gazette of the Republic of Slovenia, 27/1991.
245. Official Gazette of the Republic of Slovenia, 55/1992.
246. Bajt, Aleksander. Zakon o denacionalizaciji kot zanikanje zasebne lastnine [Denationalization Act as a Denial of Private Property]. Gospodarska gibanja [Economic Trends], No. 223, Institute of Economics, Faculty of Law, 1991/12 (Hereinafter: Bajt, Zakon o denacionalizaciji [Denationalization Act]), pp. 25-34.
247. Slovenski almanah '92-2001 [Slovenian Almanac ‘92-2001]. Delo/Novice (since 1998, Delo d. d. and Slovenske novice d. d.). Ljubljana, 1991-2000 (Hereinafter: Slovenski almanah '92-2001 [Slovenian Almanac ‘92-2001]), pp. 120-122.
248. Gorenčič, Dušan. Financiranje stanovanjske gradnje z vidika nacionalne stanovanjske varčevalne sheme in evropske izkušnje s pogodbenim varčevanjem. Magistrsko delo [Financing of the Housing Construction from the Point of View of the National Savings Scheme for Housing and the European Experience with Contractual Savings. Master's Thesis]. Ljubljana: Faculty of Economics, 2005 (Hereinafter: Gorenčič, Financiranje stanovanjske gradnje [Financing of the Housing Construction]), p. 13.
249. Mencinger, Gospodarski sistem in politika Slovenije [Slovenian Economic System and Policy], p. 55.
250. In the 1990s, the rental market was developing in two directions: non-profit rental housing and market rental housing.
251. Housing Act, Official Gazette of the Republic of Slovenia, 18/1991, Pre-Emption Right - Article 18.
252. Slovenski almanah '92-2001 [Slovenian Almanac '92-2001], pp. 120-122.
253. Tekavc, Janez. Tujci in privatizacija stanovanj [Foreigners and Housing Privatization]. URL: http://www.iusinfo.si/ (23 March 2010) (Hereinafter: Tekavc, Tujci in privatizacija stanovanj [Foreigners and Housing Privatization]), pp. 42-43.
254. Slovenski almanah '92-2001 [Slovenian Almanac '92-2001], p. 120.
255. Neffat, Branka. Privatizacija po stanovanjskem zakonu - ugotavljanje vrednosti stanovanja [Privatization under the Housing Act - Determining the Value of Housing]. URL: http://www.iusinfo.si/ (23 March 2010), p. 7.
256. Slovenski almanah '92-2001 [Slovenian Almanac '92-2001], pp. 120-122.
257. Bajt, Aleksander. Gospodarski vidiki zasebljanja stanovanj [Economic Aspects of Housing Privatization]. Gospodarska gibanja [Economic Trends], No. 224, Institute of Economics, Faculty of Law, 1992, p. 28.
258. Žnidaršič Kranjc, Alenka. Privatizacija ali zakonita kraja. Divja privatizacija, načrtovana kraja, neznanje ali slovenska nevoščljivost? [Privatization or Legal Theft. Wild Privatization, Planned Theft, Ignorance or Slovenian Envy?]. Postojna: DEJ d.o.o., 1994 (Hereinafter: Žnidaršič Kranjc, Privatizacija ali zakonita kraja [Privatization or Legal Theft]), p. 52.
259. Slovenski almanah '92-2001 [Slovenian Almanac '92-2001], pp. 121-122.
260. Lastninsko preoblikovanje slovenskih podjetij, Poročilo o delu Agencije RS za prestrukturiranje in privatizacijo [Ownership Transformation of Slovenian Companies, Report on the Work of the Agency of the Republic of Slovenia for Restructuring and Privatization]. Ljubljana: Agency of the Republic of Slovenia for Restructuring and Privatization, 1999 (Hereinafter: Lastninsko preoblikovanje slovenskih podjetij [Ownership Transformation of Slovenian Companies]), pp. 114-115.
261. Tekavc, Tujci in privatizacija stanovanj [Foreigners and Housing Privatization], pp. 42-43
262. Cirman, Andreja. Lastna nepremičnina - najpogostejša naložba v Sloveniji [Own Real Estate - The Most Common Investment in Slovenia]. Moje Finance [My Finances], Vol 2, No. 2, 2002, p. 4.
263. According to the Housing Act of 1991, the valuation of apartments throughout Slovenia took place in the same way (scoring, etc.). As we know, however, the prices of apartments (m2) have been rising differently in different places in Slovenia since 1991 (a large difference, for instance, between Ljubljana and other places), which was to be expected given the characteristics of the market. This apparently did not come to mind to the drafters of the 1991 Act.
264. Matos, Urša. Žrtve tranzicije. Novi Stanovanjski zakon bo še poslabšal položaj najemnikov v denacionaliziranih stanovanjih [Victims of Transition. The New Housing Act Will Further Worsen the Position of Tenants in Denationalized Housing]. Tednik Mladina [Mladina Newspaper], No. 11, 17 March 2003 (Hereinafter: Matos, Žrtve tranzicije [Victims of Transition]), pp. 30-31.
265. Gorenčič, Financiranje stanovanjske gradnje [Financing of the Housing Construction], p. 15.
266. Matos, Žrtve tranzicije [Victims of Transition], pp. 30-31.
267. Official Gazette of the Republic of Slovenia, 69/2003.
268. Gorenčič, Financiranje stanovanjske gradnje [Financing of the Housing Construction], p. 18.
269. Matos, Žrtve tranzicije [Victims of Transition], pp. 30-31.
270. Kovač, Stanislav. Zamolčane zgodbe slovenske tranzicije [The Untold Stories of the Slovenian Transition], Ljubljana: Mladinska knjiga, 1997, pp. 145-157. In the case in question, Kovač also states the specific names and details of the “scandal”.
271. Ibid.
272. Boncelj, Jože. Bankrotirana družba, Izmišljeni lastniki [Bankrupt Society, Fictitious Owners]. Ljubljana: SAN-PRO, 1999 (Hereinafter: Boncelj, Bankrotirana družba [Bankrupt Society]), p. 5.
273. Official Gazette of the Republic of Slovenia, 26/1990.
274. Žužek, Aleš. Prehod iz samoupravnega v tržno gospodarstvo. Magistrska naloga [Transition from a Self-Governing to a Market Economy. Master's Thesis]. Ljubljana: University of Ljubljana, Faculty of Arts, 2006, p. 172.
275. Slovenski almanah '92-2001 [Slovenian Almanac '92-2001], p. 117.
276. Čepič, Zdenko. Privatizacija gospodarstva [Privatization of the Economy]. In: Čepič,Zdenko et al. (ed.). Slovenska novejša zgodovina 2, Od programa Zedinjena Slovenija do mednarodnega priznanja Republike Slovenije 1848-1992 [Slovenian Contemporary History 2, From the United Slovenia Programme to the International Recognition of the Republic of Slovenia 1848-1992]. Ljubljana: Mladinska knjiga/Institute of Contemporary History, 2005 (Hereinafter: Čepič, Privatizacija gospodarstva [Privatization of the Economy]. In: Čepič et al. (ed.), Slovenska novejša zgodovina 2 [Slovenian Contemporary History 2]), pp. 1304-1306.
277. Cultural monuments and other real estate in Slovenia were, in principle, returned in kind. Exceptionally, real estate in respect of which there were obstacles provided for in Article 19 of the Denationalization Act was not returned. The latter read: “Real estate cannot be returned: 1. if it is used for the performance of activities of state bodies or for activities in the field of health, education, culture or other public services and if this would significantly reduce the possibility of performing these activities because it cannot be replaced by other real estate or the replacement would be associated with disproportionate costs; 2. if it is an inseparable component of the network, facilities, devices or other assets of public companies in the field of energy, utilities, transport and communications, which are exempt from privatization by law; 3. if it is exempt from legal transactions or it is not possible to acquire property rights on it; 4. if the spatial complexity or the purpose of the use of space and real estate would be significantly reduced; 5. in other cases provided by this Act. The provision of point 4 of the previous paragraph and Article 20 of this Act shall not apply to forests, and the provisions of Article 27 of this Act shall apply to the return of agricultural land from functional complexes.” Let us also mention Article 20 of the Denationalization Act, which read: “The real estate cannot be returned to ownership and possession if the return of the real estate would significantly impair the economic or technological functionality of the complexes.” Despite later amendments to the Act, in practice there were unfortunately major problems and lengthy court proceedings in this area. Some are still unfinished today. However, we can safely say that mainly to the detriment of real estate, which is crumbling.
278. Pirc, Vanja. Hitra rešitev s specialnimi efekti [Fast Solution with Special Effects]. Mladina, No. 10, 2008 (Hereinafter: Pirc, Hitra rešitev s specialnimi efekti [Fast Solution with Special Effects]), pp. 26-27.
279. Bajt, Aleksander. Problemi denacionalizacije [Problems of Denationalization]. In: Bohinc, Rado, Milkovič, Nina (eds.). Privatizacija na Slovenskem 1990-1992 [Privatization in Slovenia 1990-1992]. Ljubljana: Slovenski inštitut za management Ljubljana d.d., DZS, d. d., 1993, pp. 189-230.
280. Slovenski almanah '92-2001 [Slovenian Almanac '92-2001], p. 118.
281. Bajt, Zakon o denacionalizaciji [Denationalization Act], pp. 25-34.
282. During the process, citizenship or proving it posed a major problem. Some people also sought justice at the European Court of Human Rights. There are known cases of heirs who fought for real estate and proved the citizenship of their ancestors, whose real estate (located on the territory of present-day Slovenia) was expropriated by the Yugoslav authorities in September 1945. The problem often arose if the ancestors were citizens of the former Kingdom of Yugoslavia on 6 April 1941, but because they left the territory of the present-day Slovenia in 1945, the Yugoslav authorities treated them as persons of German nationality, that is to say, as persons whose mother tongue is German.
283. Denationalization Act, Official Gazette of the Republic of Slovenia, 27/1991, Chapter II (Articles 9-15).
284. The Denationalization Act defined the property of feudal origin in Article 27a, which read: “Property of feudal origin is not subject to denationalization, except insofar as it relates to casesin which the denationalization beneficiaries are churches and other religious communities, their institutions or orders. Property of feudal origin under the preceding paragraph shall be deemed to be property donated by the monarch which was not subsequently the subject of a legal transaction for consideration.” In the denationalization process, property of feudal origin was thus returned only to religious communities, with the Roman Catholic Church being the greatest beneficiary.
285. Resolution by which, on the proposal of the National Assembly, the deadline set in point 4 of the decision of the Constitutional Court No. U-I-107/96 of 5 December 1996 was extended until 31 July 1997, p. 3798, Official Gazette of the Republic of Slovenia, 41/1997.
286. 16. poročilo o uresničevanju Zakona o denacionalizaciji za obdobje od 30. 06. 2000 do 30. 06. 2001 [16th Report on the implementation of the Denationalization Act for the period from 30 June 2000 to 30 June 2001], Ministry of Justice / July 2001, pp. 4-6. URL: http://www.mp.gov.si/fileadmin/mp.gov.si/pageuploads/2005/PDF/porocila/poroc_zden_16.pdf (9 November 2009).
287. Lastninsko preoblikovanje slovenskih podjetij [Ownership Transformation of Slovenian Companies], p. 25.
288. Ibid., p. 123.
289. Official Gazette of the Republic of Slovenia, 65/1998.
290. Združenje lastnikov razlaščenega premoženja Slovenije [Slovenian Association of Owners of Expropriated Property].
291. Pirc, Hitra rešitev s specialnimi efekti [Fast Solution with Special Effects], pp. 26-27.
292. Annual Report for 2001, Office of the Ombudsman of the Republic of Slovenia.
293. For example, in 2003 the Constitutional Court ruled that the right to housing had not been violated to the tenants of denationalized apartments and that they had not been discriminated against, as former holders of housing rights could stay in the apartments for an indefinite period and with non-profit rent. In 2005, the Supreme Court then amended the applicable case law recognizing the right of a spouse or close family members to remain in a non-profit tenancy after the tenant's death. The Supreme Court ruled that after the death of the contract owner, the owners were no longer obliged to rent out the apartments for nonprofit rent to their family. This was followed by new proceedings before the Constitutional Court, which ruled at the end of 2009 that in case of the tenant's death, the non-profit rent belonged only to the spouse, but not to their close family members. Feantsa, the European Federation of National Organizations Working with the Homeless, filed a collective complaint with the European Court of Justice in August 2008 after learning in detail about the situation of tenants in denationalized housing in Slovenia and the numerous complaints from them. The European Committee of Social Rights at the Council of Europe found that Slovenia's housing policy reforms put the tenants of the apartments returned to the former private owners in a precarious position, contrary to the Revised European Social Charter. The right to housing, the right to family protection and the prohibition of discrimination were violated. (Matjaž Albreht wrote in more detail about this issue in an article entitled “Slovenija krši evropsko socialno listino” [“Slovenia Violates the European Social Charter”], which was published in the Saturday supplement of Delo on 6 February 2010.)
294. Government Communication Office. Press release on the resolutions adopted by the Government of the Republic of Slovenia at its 63rd session, on 2 March 2006.
295. The Denationalization Act foresaw that all claims and proceedings in the first instance would be completed within one year. When the Denationalization Act was passed in 1991, it was also planned that the property in the value of four billion Deutschmarks or two billion euros would be returned, while according to the data from the beginning of 2007, it was already clear that the costs would be much higher, perhaps even twice as high. According to the data of the Ministry of Justice, 1 billion 881 million euros worth of land, forests, buildings and movables had been returned in kind by the end of March 2007. Where return was not possible in kind, the beneficiaries were entitled to compensation in the form of bonds and 6% interest. The Slovenian Compensation Company paid out more than 400 million euros by spring 2007, and is expected to pay out another 1.3 billion euros by the end of the procedure.
296. Vlada je dolžna nadzorovati tajno službo - Intervju z ministrom Lovrom Šturmom [The Government is Obliged to Control the Secret Service - Interview with Minister Lovro Šturm], Spletna Demokracija. URL: www.mp.gov.si/.../2007_07_12_intervju_ministra_Demokracija.pdf (15 July 2007).
297. Ministry of Justice. URL: http://www.mp.gov.si/nc/si/splosno/cns/novica/article/11999/5696/ (10 September 2010).
298. National Council of the Republic of Slovenia. URL: http://www.ds-rs.si/?q=node/411 (10 September 2010).
299. Predlog zakona o zaključku postopkov vračanja podržavljenega premoženja [Bill on the Completion of Procedures for the Return of Nationalized Property] - 26 March 2007, Ministry of Justice, Ljubljana. URL: http://www.mp.gov.si/fileadmin/mp.gov.si/pageuploads/2005/PDF/zakonodaja/2007_04_18_predlog_zakona_zakljucek_vracanja_premozenja.pdf (20 January 2010).
300. Čepič, Privatizacija gospodarstva [Privatization of the Economy]. In: Čepič et al. (ed.), Slovenska novejša zgodovina 2 [Slovenian Contemporary History 2], pp. 1304-1306.
301. Ibid., pp. 1305-1306.
302. Archives of the Republic of Slovenia, AS 233, box 4872, 29th Session of the Executive Council of the Republic of Slovenia, 24 October 1990 (Assessment of the situation in the economy of the Republic of Slovenia with proposals for measures for regulation in individual areas, p. 10).
303. Prinčič, Borak, Iz reforme v reformo [From Reform to Reform], pp. 594-613.
304. Čepič, Privatizacija gospodarstva [Privatization of the Economy]. In: Čepič et al. (ed.), Slovenska novejša zgodovina 2 [Slovenian Contemporary History 2], pp. 1304-1306.
305. Prinčič, Borak, Iz reforme v reformo [From Reform to Reform], pp. 594-613.
306. Repe, Slovenci v osemdesetih letih [Slovenes in the 1980s], pp. 76-80.
307. Prinčič, Borak, Iz reforme v reformo [From Reform to Reform], pp. 594-613.
308. Repe, Slovenci v osemdesetih letih [Slovenes in the 1980s], pp. 76-80.
309. Prinčič, Borak, Iz reforme v reformo [From Reform to Reform], pp. 594-613.
310. Ovin, Rasto. Komentar k privatizacijskim razpravam o privatizaciji [Commentary on Privatization Discussions on Privatization]. Bilten EDP [EDP Bulletin]. Institute for Economic Diagnosis and Prognosis, Vol. 14, No. 4, 1992, pp. 17-25.
311. Šušteršič, Politično gospodarski cikli [Political and Economic Cycles], pp. 211-222.
312. Repovž, Grega. Intervju z dr. Jožetom Mencingerjem [Interview with Dr. Jože Mencinger]. Mladina, No. 46, 10 November 2006, pp. 36-40.
313. Mencinger, Začasnost samostojnosti? [Temporariness of Independence?], pp. 303-312.
314. Agens, No. 1, September 1993, p. 2.
315. Nežmah, Bernard. Doba sindikatov [The Age of Unions]. Mladina, 16 April 2009.
316. Popit, Ilija. Prof. Aleksander Bajt o slovenski gospodarski politiki (2). Napačna pot privatizacije [Prof. Aleksander Bajt on Slovenian Economic Policy (2). The Wrong Path of Privatization]. Delo, Vol. 33, No. 207, 4 September 1991, p. 2.
317. Mekina, Borut. Rojstvo podalpskih oligarhov [The Birth of Subalpine Oligarchs]. Mladina. si/Tednik. URL: http://www.mladina.si/tednik/200732/clanek/slo-tema--borut_mekina/ (29 May 2009).
318. Ribnikar, Ivan. Družbena lastnina in narobe poskusi njene odprave: od leta 1989 do dandanes [Socially-Owned Property and the Wrong Attempts to Abolish It: From 1989 to the Present Day]. Teorija in praksa [Theory and Practice], Vol. 29, No. 9-10, 1992, pp. 877-890.
319. Ivan Ribnikar. Drugi (in tretji) steber pokojninskega sistema in trg kapitala [The Second (and Third) Pillar of the Pension System and the Capital Market.]. Bančni vestnik [Banking Journal], Vol. 47, No. 5, May 1998, pp. 49-51.
320. Official Gazette of the Republic of Slovenia, 50/1999.
321. Bohinc, Rado. Ureditev privatizacije po veljavni slovenski zakonodaji [Regulation of Privatization According to the Valid Slovenian Legislation]. In: Bohinc, Rado, Milkovič, Nina (eds.). Privatizacija na Slovenskem 1990-1992 [Privatization in Slovenia 1990-1992]. Ljubljana: Slovenski inštitut za management Ljubljana d.d., DZS, d. d., 1993, p. 7.
322. Žnidaršič Kranjc, Privatizacija ali zakonita kraja [Privatization or Legal Theft], p. 33.
323. Gregorec, Zdravko (ed.). OECD Gospodarski pregledi 1996-1997: Slovenija, Organizacija za ekonomsko sodelovanje in razvoj [OECD Economic Reviews 1996-1997: Slovenia, Organization for Economic Co-operation and Development], Ljubljana: Centre for CoOperation with Economies in Transition/Ministry of Foreign Affairs/Office for European Affairs, 1997 (Hereinafter: Gregorec (ed.), OECD Gospodarski pregledi 1996-1997: Slovenija [OECD Economic Reviews 1996-1997: Slovenia]), pp. 91-92.
324. Čepič, Privatizacija gospodarstva [Privatization of the Economy]. In: Čepič et al. (ed.),Slovenska novejša zgodovina 2 [Slovenian Contemporary History 2], pp. 1304-1306.
325. Štiblar, Franjo. Privatization in Slovenia. In: Senjur, Marjan (ed.). Slovenia - A Small Country in the Global Economy. Ljubljana: Centre for International Cooperation and Development - CICD, 1993, pp. 181-191.
326. Žnidaršič Kranjc, Privatizacija ali zakonita kraja [Privatization or Legal Theft], p. 9.
327. Poročilo o lastninskem preoblikovanju podjetij [Report on the Ownership Transformation of Companies]. Ljubljana: Agency of the Republic of Slovenia for Restructuring and Privatization, 1997 (Hereinafter: Poročilo o lastninskem preoblikovanju podjetij [Report on the Ownership Transformation of Companies]), pp. 14-27.
328. Gregorec (ed.), OECD Gospodarski pregledi 1996-1997: Slovenija [OECD Economic Reviews 1996-1997: Slovenia], p. 92.
329. Simoneti, Marko et al. Spremembe v strukturi in koncentraciji lastništva ter poslovanje podjetij po razdelitveni privatizaciji v Sloveniji v razdobju 1995-99. Empirična in institucionalna analiza [Changes in the Structure and Concentration of Ownership and the Operation of Companies after Distributive Privatization in Slovenia in the Period 1995-99. Empirical and Institutional Analysis]. Ljubljana: CEEPN Research, 2001 (Hereinafter: Simoneti et al., Spremembe v strukturi in koncentraciji lastništva [Changes in the Structure and Concentration of Ownership]), p. 6.
330. Jakomin L., Alenka. Intervju z Dušanom Mramorjem [Interview with Dušan Mramor]. Agens, No. 8, April 1994, pp. 2-3.
331. Poročilo o lastninskem preoblikovanju podjetij [Report on the Ownership Transformation of Companies], pp. 14-27.
332. Lastninsko preoblikovanje slovenskih podjetij [Ownership Transformation of Slovenian Companies], pp. 22-27.
333. Official Gazette of the Republic of Slovenia, 32/1993.
334. Official Gazette of the Republic of Slovenia, 13/1992.
335. Official Gazette of the Republic of Slovenia, 30/1993.
336. Official Gazette of the Republic of Slovenia, 75/1994.
337. Official Gazette of the Republic of Slovenia, 82/1994.
338. Official Gazette of the Republic of Slovenia, 10/1993.
339. Official Gazette of the Republic of Slovenia, 24/1996.
340. Official Gazette of the Republic of Slovenia, 16/1996.
341. Official Gazette of the Republic of Slovenia, 27/1991.
342. Official Gazette of the Republic of Slovenia, 40/1997.
343. Official Gazette of the Republic of Slovenia, 13/1992.
344. Lastninsko preoblikovanje slovenskih podjetij [Ownership Transformation of Slovenian Companies], pp. 88, 138.
345. Official Gazette of the Republic of Slovenia, 31/1993.
346. Prinčič, Jože. Tovarna vijakov Plamen Kropa: od konca druge svetovne vojne do stečaja in novega začetka (1945-1997) [The Plamen Kropa Screw Factory: From the End of the Second World War to Bankruptcy and a New Beginning (1945-1997)]. Radovljica: Gazette of the Blacksmith Museum in Kropa, Museums of the Municipality of Radovljica, 2007, p. 158.
347. Čeh, Silva. Intervju z Metodom Dragonjo [Interview with Metod Dragonja]. Agens, No. 6, February 1994, pp. 2-3.
348. Simoneti et al., Spremembe v strukturi in koncentraciji lastništva [Changes in the Structure and Concentration of Ownership], pp. 5-10.
349. Popovič, Anica: Zakon o lastninskem preoblikovanju podjetij [Ownership Transformation of Companies Act]. Podjetje in delo [Company and Work], No. 2, 10 May 1993 (Hereinafter: Popovič, Zakon o lastninskem preoblikovanju podjetij [Ownership Transformation of Companies Act]), p. 85. URL: http://www.ius-software.si (18 January 2010).
350. Archives of the Republic of Slovenia, AS 1272 (Social Attorney of the Republic of Slovenia), box 412, R 3/2000 R (Report following the decision of the Rejc Commission).
351. Archives of the Republic of Slovenia, AS 1272, box 412, R 3/2000 R (Report following the decision of the Rejc Commission).
352. Archives of the Republic of Slovenia, AS 1272, box 412, R 3/2000 R (Report following the decision of the Rejc Commission).
353. Archives of the Republic of Slovenia, AS 1272, box 412, R 3/2000 R (Report following the decision of the Rejc Commission).
354. Archives of the Republic of Slovenia, AS 1272, box 417, R 1/01R (Activities of the Social Attorney of the Republic of Slovenia in relation to audit reports of 1 July 1993-31 March 2001).
355. Archives of the Republic of Slovenia, AS 1272, box 412, R 1/04R (Overview of the activities of the Social Attorney of the Republic of Slovenia from 1 January 2004 to 30 June 2004 and from 1 July 2004 to 31 December 2004).
356. Bajt, Aleksander. Protiustavnost uzakonjenega sistema lastninjenja [Unconstitutionality of the Legalized System of Ownership Transformation]. Gospodarska gibanja [Economic Trends], No. 246, Institute of Economics, Faculty of Law, 1994/1, pp. 19-38.
357. Damijan, Jože. Slovenska privatizacijska burka [Slovenian Privatization Comedy]. Gospodarski vestnik [Economic Journal], No. 51, Vol. XLI, 24 December 1992, pp. 14-15.
358. Poročilo o lastninskem preoblikovanju podjetij [Report on the Ownership Transformation of Companies], p. 14.
359. Act Amending the Ownership Transformation of Companies Act - Article 18. Official Gazette of the Republic of Slovenia, 31/1993.
360. Repe, Božo, Nečak, Dušan. Oris sodobne obče in slovenske zgodovine: učbenik za študente 4. letnika [Outline of Contemporary General and Slovenian History: A Textbook for 4 th Year Students]. Ljubljana: Department of History, Faculty of Arts, University of Ljubljana, 2003.
361. Aplenc, Andrej. Prodaja Slovenije [The Sale of Slovenia]. Ljubljana: Mladinska knjiga, 1997, p. 160.
362. Berdnik, Mojca. Prihaja leto koncentracije [The Year of Concentration is Coming]. Gospodarski vestnik [Economic Journal], No. 50, 1998 (Hereinafter: Berdnik, Prihaja leto koncentracije [The Year of Concentration is Coming]), pp. 11-12.
363. Jakomin L., Alenka. Intervju z Antonom Ropom [Interview with Anton Rop]. Agens, No. 2, October 1993 (Hereinafter: Jakomin L., Intervju z Antonom Ropom [Interview with Anton Rop]), pp. 2-3.
364. Izjava dr. Dimitrija Rupla [Statement by Dr. Dimitrij Rupel]. Informativna oddaja Omizje (Ko se decembra zgosti čas.) [Omizje News Programme (When Time Thickens in December...)]. TV SLO 1, 26 December 2007. URL: http://www.rtvslo.si/modload.php?&c_mod=rtvoddaje&op=web&func=read&c_id=i75... (8 January 2008) (Hereinafter: Statement by Dr. Dimitrij Rupel).
365. Izjava dr. Franca Zagožna [Statement by Dr. Franc Zagožen]. Informativna oddaja Omizje (Ko se decembra zgosti čas.) [Omizje News Programme (When Time Thickens in December.)]. TV SLO 1, 26 December 2007. URL: http://www.rtvslo.si/modload.php?&c_mod=rtvoddaje&op=web&func=read&c_id=175. (8 January 2008).
366. Jakomin L., Intervju z Antonom Ropom [Interview with Anton Rop], p. 2.
367. Čeh, Silva. Intervju z Markom Simonetijem [Interview with Marko Simoneti]. Agens, No. 3, November 1993 (Hereinafter: Čeh, Intervju z Markom Simonetijem [Interview with Marko Simoneti]), pp. 2-3.
368. Strniša, Maja. Slovenci o lastninjenju [Slovenians on Privatization]. Agens, No. 15, October 1994, p. 14.
369. Kako je potekala tajkunizacija v Sloveniji? [How Did Tycoonization Take Place in Slovenia?]. Odmevi, RTV SLO 1, 24 April 2009. URL: http://www.rtvslo.si/play/kako-je-potekala-tajkunizacija/ava2.33130690/ (25 April 2009).
370. Čeh, Intervju z Markom Simonetijem [Interview with Marko Simoneti], p. 2.
371. Androjna, Roman. Investicijski skladi [Investment Funds]. Agens, No. 3, November 1993, pp.4-5.
372. Ibid.
373. Official Gazette of the Republic of Slovenia, 6/1994.
374. Official Gazette of the Republic of Slovenia, 110/2002.
375. Žnidaršič Kranjc, Investicijski skladi v Sloveniji [Investment Funds in Slovenia], pp. 58-65.
376. Polanc, Mateja. Ekstremno ravnanje ne daje optimalnih rezultatov. Intervju s StanislavomValantom 2003 [Extreme Behaviour Does Not Give Optimal Results. Interview with Stanislav Valant 2003]. Published on SOCIUS' pages (Corporate Performance and Governance Network). URL: http://www.socius.si/file/3985/file.html (17 June 2008).
377. Bank of Slovenia, Annual Report for 1999, p. 14.
378. Bank of Slovenia, Annual Report for 1997, p. 10.
379. Bank of Slovenia, Annual Report for 1999, p. 14.
380. 6th regular session of the National Assembly of the Republic of Slovenia, 22 May 2001.
381. Official Gazette of the Republic of Slovenia, 50/1999.
382. Official Gazette of the Republic of Slovenia, 68/2007.
383. UL SFRJ - Uradni list Socialistične Federativne Republike Jugoslavije [Official Gazette of the Socialist Federal Republic of Yugoslavia] (Hereinafter: Official Gazette of the Socialist Federal Republic of Yugoslavia), 77/1988.
384. Official Gazette of the Socialist Federal Republic of Yugoslavia, 84/1989.
385. Lastninsko preoblikovanje slovenskih podjetij [Ownership Transformation of Slovenian Companies], pp. 100-101.
386. Žnidaršič Kranjc, Privatizacija ali zakonita kraja [Privatization or Legal Theft], p. 133.
387. Official Gazette of the Republic of Slovenia, 55/1992, Article 48, p. 3123.
388. Official Gazette of the Republic of Slovenia, 58/1995.
389. Petrov, Sabina. Intervju z Alenko Kovač Arh [Interview with Alenka Kovač Arh]. Agens, No.41, December 1996, pp. 2-4.
390. Agencija Republike Slovenije za revidiranje lastninskega preoblikovanja podjetij [Agency of the Republic of Slovenia for the Audit of the Ownership Transformation of Companies]. Archive page. URL: http://www.arlpp.gov.si7Revizija_LP_.htm (20 January 2010).
391. Official Gazette of the Republic of Slovenia, 80/2004.
392. Krnc, Janez. Revizije predhodnega lastninjenja [Audits of Pre-Privatization]. Gospodarska gibanja [Economic Trends], No. 20, 22 May 1997 (Hereinafter: Krnc, Revizije predhodnega lastninjenja [Audits of Pre-Privatization]), pp. 71-74.
393. Amendments and changes to Article 48 of the Ownership Transformation of Companies Act were made in Articles 24, 25 and 27 of the Act Amending the Ownership Transformation of Companies Act. Official Gazette of the Republic of Slovenia, 7/1993.
394. Krnc, Revizije predhodnega lastninjenja [Audits of Pre-Privatization], pp. 71-74.
395. Ibid.
396. Popovič, Anica. Primer oškodovanja družbene lastnine oziroma divje privatizacije [An Example of Damage to Socially-Owned Property or Wild Privatization]. Podjetje in delo [Company and Work], No. 7, 9 November 1992 (Hereinafter: Popovič, Primer oškodovanja družbene lastnine [An Example of Damage to Socially-Owned Property]), pp. 756-760.
397. Krnc, Revizije predhodnega lastninjenja [Audits of Pre-Privatization], pp. 71-74.
398. Popovič, Primer oškodovanja družbene lastnine [An Example of Damage to Socially- Owned Property], pp. 756-760.
399. Popovič, Anica. »Sporno lastninjenje« [“Controversial Privatization”]. Pravna praksa [Legal Practice], No. 259, 15 October 1992, p. 29. URL: http://www.ius-software.si (18 January 2010).
400. Žnidaršič Kranjc, Privatizacija ali zakonita kraja [Privatization or Legal Theft], p. 14. The president of the Commission was Ludvik Toplak.
401. Žnidaršič Kranjc, Alenka. Družbeno nezaželjeni pojavi v povezavi s preoblikovanjem družbene lastnine [Socially Undesirable Phenomena in Connection with the Transformation of Socially-Owned Property] In: Bohinc, Rado, Milkovič, Nina (eds.). Privatizacija na Slovenskem 1990-1992 [Privatization in Slovenia 1990-1992]. Ljubljana: Slovenski inštitut za management Ljubljana d.d., DZS, d. d., 1993, pp. 172-188.
402. Calculation verifiable at URL: http://www.stat.si/indikatorji_preracun_reval.asp (2 October 2008).
403. The starting date for calculating the revalued amount was 31 December 1992.
404. Implementation of the Republic of Slovenia Budget for 1992 Act. Official Gazette of the Republic of Slovenia, 16/1992.
405. The amount of 2.5 billion euros is the value obtained by calculating or revaluing the monetary amount with a starting date of 31 December 1992. Damage to socially-owned property in the period 1990-1992 therefore represented approximately 50 percent of the budget of the Republic of Slovenia for 1992! If we take 1 January 1992 as the initial value, the recalculated value is much higher. The latter amounts to 4.7 billion euros (the cause is inflation). The calculation was made on 2 October 2008.
406. Poročilo o lastninskem preoblikovanju podjetij [Report on the Ownership Transformation of Companies], pp. 10-11.
407. Kovač, Bogomir. Uvod v podjetništvo: analiza poslovnega načrta [Introduction to Entrepreneurship: An Analysis of a Business Plan]. Ljubljana: University, 1990, pp. 1-7.
408. Vahčič, Aleš. Stanje podjetništva v Sloveniji [The State of Entrepreneurship in Slovenia].In: Borak, Neven (ed.). Slovensko podjetje v devetdesetih [Slovenian Company in the Nineties]. Ljubljana: Association of Economists of Slovenia, 2000 (Hereinafter: Vahčič, Stanje podjetništva v Sloveniji [The State of Entrepreneurship in Slovenia]. In: Borak (ed.), Slovensko podjetje v devetdesetih [Slovenian Company in the Nineties]), pp. 49-59.
409. Žugelj, Damjan et al.. Tvegani kapital: si upate tvegati? [Venture Capital: Do You Dare to Take a Risk?]. Ljubljana: Lisac & Lisac, 2001, p. 14.
410. Žakelj, Luka. Podjetniška aktivnost in podjetniško okolje v Sloveniji [Entrepreneurial Activity and Entrepreneurial Environment in Slovenia]. UMAR/Delovni zvezek [IMAD/ Workbook], No. 4, 2006 (Hereinafter: Žakelj, Podjetniška aktivnost in podjetniško okolje [Entrepreneurial Activity and Entrepreneurial Environment]), p. 11.
411. Žakelj, Luka. Razvoj malih in srednje velikih podjetij v Sloveniji in Evropski uniji [Development of Small and Medium-Sized Enterprises in Slovenia and the European Union]. UMAR/Delovni zvezek [IMAD/Workbook], No. 6, 2004 (Hereinafter: Žakelj, Razvoj malih in srednje velikih podjetij [Development of Small and Medium-Sized Enterprises]), pp. 7-12.
412. Žakelj, Podjetniška aktivnost in podjetniško okolje [Entrepreneurial Activity and Entrepreneurial Environment], p. 11.
413. Žakelj, Razvoj malih in srednje velikih podjetij [Development of Small and Medium-Sized Enterprises], p. 14.
414. Poročilo o lastninskem preoblikovanju podjetij [Report on the Ownership Transformation of Companies], p. 3.
415. Ribnikar, Ivan. Pot od družbene lastnine k lastnini gospodarskih podjetij [The Path from Social Ownership to Ownership of Business Enterprises]. Journal for Institutional Innovation Development and Transition, Institute of Macroeconomic Analysis and Development, No. 1, 1997.
416. Vahčič, Stanje podjetništva v Sloveniji [The State of Entrepreneurship in Slovenia]. In: Borak (ed.), Slovensko podjetje v devetdesetih [Slovenian Company in the Nineties], pp. 49-59.
417. Official Gazette of the Socialist Federal Republic of Yugoslavia, 77/1988.
418. Fikfak, Jurij, Prinčič, Jože, Turk, Jeffrey David. Biti direktor v času socializma: med idejami in praksami [To Be a Director in the Time of Socialism: Between Ideas and Practice]. Ljubljana: Založba ZRC, ZRC SAZU, 2008, pp. 43-44.
419. Plut, Tadeja, Plut, Helena. Podjetnik in podjetništvo [Entrepreneur and Entrepreneurship]. Ljubljana: Spekter Collection/Science and Journalism Centre, 1995, p. 43.
420. Official Gazette of the Socialist Federal Republic of Yugoslavia, 46/1990.
421. Official Gazette of the Socialist Republic of Slovenia, 35/1988.
422. Žakelj, Razvoj malih in srednje velikih podjetij [Development of Small and Medium-Sized Enterprises], p. 31.
423. Official Gazette of the Socialist Federal Republic of Yugoslavia, 84/1989.
424. Lorenčič, Aleksander. Privatizacija: ozbiljan problem u slovenačkoj ekonomskoj tranziciji [Privatization: A Serious Problem in the Slovenian Economic Transition]. Megatrend revija [Megatrend Magazine], Vol. 6, No. 1, 2009, pp. 1-3.
425. Vahčič, Stanje podjetništva v Sloveniji [The State of Entrepreneurship in Slovenia]. In: Borak (ed.), Slovensko podjetje v devetdesetih [Slovenian Company in the Nineties], pp. 49-59.
426. The European Observatory for SMEs. First Annual Report. European Network for SME Research, p. 15 (Hereinafter: The European Observatory for SMEs).
427. Official Gazette of the Socialist Federal Republic of Yugoslavia, 64/1989.
428. Ibid.
429. Lastninsko preoblikovanje slovenskih podjetij [Ownership Transformation of Slovenian Companies], pp. 118-119.
430. Official Gazette of the Republic of Slovenia, 18/1991.
431. Pšeničny, Viljem et al. Podjetništvo: Podjetnik, podjetniška priložnost, podjetniški proces, podjem [Entrepreneurship: Entrepreneur, Entrepreneurial Opportunity, Entrepreneurial Process, Venture]. Portorož: College of Entrepreneurship/Gea College, 2000 (Hereinafter: Pšeničny et al., Podjetništvo [Entrepreneurship]), p. 40.
432. Žakelj, Razvoj malih in srednje velikih podjetij [Development of Small and Medium-Sized Enterprises], pp. 31-32.
433. Official Gazette of the Republic of Slovenia, 55/1992.
434. Official Gazette of the Republic of Slovenia, 30/1993.
435. The European Observatory for SMEs, p. 15.
436. Official Gazette of the Republic of Slovenia, 50/1994.
437. Pšeničny et al., Podjetništvo [Entrepreneurship], pp. 40-43.
438. Žakelj, Razvoj malih in srednje velikih podjetij [Development of Small and Medium-Sized Enterprises], p. 32.
439. Official Gazette of the Republic of Slovenia, 45/2001.
440. UMAR, Ekonomsko ogledalo [IMAD, Slovenian Economic Mirror] (Hereinafter: IMAD, Slovenian Economic Mirror), No. 6, 2003, p. 16.
441. Žakelj, Razvoj malih in srednje velikih podjetij [Development of Small and Medium-Sized Enterprises], p. 12.
442. IMAD, Slovenian Economic Mirror, No. 6, 2003, p. 16.
443. Bajt, Aleksander. Iz heterodoksne stabilizacije v ultraortodoksno: Kako iz nje? [From Heterodox Stabilization to Ultra-Orthodox One: How to Get Out of It?]. In: Gospodarska gibanja [Economic Trends], No. 206, 1990, pp. 27-39.
444. Official Gazette of the Republic of Slovenia, 40/2004.
445. Žakelj, Razvoj malih in srednje velikih podjetij [Development of Small and Medium-Sized Enterprises], p. 7.
446. Kresal, France. Socialna politika v Sloveniji do druge svetovne vojne [Social Policy in Slovenia until the Second World War] In: Borak, Neven, Lazarević, Žarko (eds.). Prevrati in slovensko gospodarstvo v 20. stoletju; 1918-1945-1991 [Coups and the Slovenian Economy in the 20 th Century; 1918-1945-1991]. Ljubljana: Cankarjeva založba, 1996, pp. 49-64.
447. Vahčič, Stanje podjetništva v Sloveniji [The State of Entrepreneurship in Slovenia]. In: Borak (ed.), Slovensko podjetje v devetdesetih [Slovenian Company in the Nineties], pp. 49-59.
448. Boncelj, Bankrotirana družba [Bankrupt Society], pp. 84-85.
449. Poročilo o lastninskem preoblikovanju podjetij [Report on the Ownership Transformation of Companies], p. 7.
450. Žakelj, Razvoj malih in srednje velikih podjetij [Development of Small and Medium-Sized Enterprises], pp. 37-38.
451. Official Gazette of the Republic of Slovenia, 40/2004.
452. Žakelj, Razvoj malih in srednje velikih podjetij [Development of Small and Medium-Sized Enterprises], pp. 33-37.
453. The fate and experiences of employees in the case of the Mura factory are excellently presented by Dr. Nina Vodopivec (Vodopivec, Nina. Tu se ne bo nikoli več šivalo: doživljanja izgube dela in propada tovarne [Here, No One Will Ever Sew Again: Experiencing Job Loss and Factory Collapse]. Ljubljana: Institute for Contemporary History, 2021, Razpoznavanja/ Recognitiones Collection).
454. Žnidaršič Kranjc, Alenka. Planirani stečaji? Značilnosti, razlogi, koristi in škoda v stečajih slovenskih podjetij [Planned Bankruptcies? Characteristics, Reasons, Benefits and Damage in Bankruptcies of Slovenian Companies]. Radovljica: Didakta, 1993 (Hereinafter: Žnidaršič Kranjc, Planirani stečaji? [Planned Bankruptcies?]), p. 15.
455. Official Gazette of the Republic of Slovenia, 67/1993.
456. Official Gazette of the Socialist Federal Republic of Yugoslavia, 72/1986.
457. Žnidaršič Kranjc, Planirani stečaji? [Planned Bankruptcies?], p. 191.
458. Bankrotirana družba [Bankrupt Society], pp. 149-151.
459. Boncelj, Bankrotirana družba [Bankrupt Society], p. 149.
460. Borak, Iskanje Guliverja [Searching for Gulliver], p. 102.
461. Boncelj, Bankrotirana družba [Bankrupt Society], p. 85.
462. URL: http://www.talum.si (August 2005).
463. Tednik, 14 June 1990, Vol. XLIII, No. 23, p. 2.
464. Tednik, 2 November 1990, Vol. XLIII, No. 43, p. 3.
465. Tednik, 23 May 1991, Vol. XLIV, No. 20, p. 2.
466. Tednik, 5 December 1991, Vol XLIV, No. 48, p. 1.
467. URL: http://www.talum.si (August 2005).
468. Tednik, 13 November 1990, Vol. XLII, No. 48, p. 3.
469. Tednik, 16 January 1992, Vol. XLV, No. 2, p. 2.
470. URL: http://www.perutnina.si (August 2005).
471. Prinčič, Borak, Iz reforme v reformo [From Reform to Reform], p. 619.
472. Prinčič, Borak, Iz reforme v reformo [From Reform to Reform], pp. 618-619.
473. URL: http://www.gorenjegroup.com, 11 December 2007.
474. Poročevalec Državnega zbora Republike Slovenije [Rapporteur of the National Assembly of the Republic of Slovenia], No. 34, 20 September 1996, p. 133.
475. Križanič, France, Oplotnik, Žan. Ekonometrična ocena vpliva zaključka procesa lastninskega preoblikovanja podjetij na investiranje in dinamiko prilivov tujega kapitala v Slovenijo [Econometric Assessment of the Impact of the Completion of the Process of Ownership Transformation of Companies on Investments and the Dynamics of Foreign Capital Inflows into Slovenia]. Gospodarska gibanja [Economic Trends], No. 309, 1999/10 (Hereinafter: Križanič, Oplotnik, Ekonometrična ocena [Econometric Assessment]), pp. 25-35.
476. Lastninsko preoblikovanje slovenskih podjetij [Ownership Transformation of Slovenian Companies], p. 81.
477. Mencinger, Jože. Privatization in Slovenia. Slovenian Law Review, Vol. 3, No. 1/2, December 2006, pp. 65-81.
478. Križanič, Oplotnik, Ekonometrična ocena [Econometric Assessment], pp. 25-35.
479. Official Gazette of the Republic of Slovenia, 30/1998.
480. Lastninsko preoblikovanje slovenskih podjetij [Ownership Transformation of Slovenian Companies], pp. 37, 133.
481. Tajnikar, Maks. Preobrazba velikih podjetij še ni končana [The Transformation of Large Companies is Not Finished]. Gospodarski vestnik [Economic Journal], Vol. 48, No. 49, 9 December 1999, pp. 20-22.
482. Official Gazette of the Republic of Slovenia, 45/2001.
483. Žakelj, Razvoj malih in srednje velikih podjetij [Development of Small and Medium-Sized Enterprises], pp. 33-37.
484. Bank of Slovenia, Annual Report for 1999.
485. Kovač, Stanislav. Cvikl odhaja, Slovenija raja [Cvikl is Leaving, Slovenia is Rejoicing]. Finance, No. 50, 15 March 2010, p. 11.
486. Popovič, Zakon o lastninskem preoblikovanju podjetij [Ownership Transformation of Companies Act], p. 8.
487. Popovič, Anica. Lastninjenje pred koncem - o oškodovanjih pa še novi postopki [Privatization Before the End - New Procedures on Damages]. Pravna praksa [Legal Practice], No. 6, 2 April 1998, pp. 1-2. URL: http://www.ius-software.si (18 January 2010).
488. Last report on the work of the Agency for the Audit on 31 July 2004.
489. Official Gazette of the Republic of Slovenia, 7/1993.
490. On 1 January 1999, the ECU was replaced by the euro in a 1:1 ratio. As of 1 January 1999, any reference to the ECU in contracts, regulations and other official documents has been replaced by a reference to the euro in a 1:1 ratio. Unlike the ECU, which was defined as a basket of twelve currencies, the euro became an independent currency.
491. Lastninsko preoblikovanje slovenskih podjetij [Ownership Transformation of Slovenian Companies], pp. 128-132.
492. Gregorec (ed.), OECD Gospodarski pregledi 1996-1997: Slovenija [OECD Economic Reviews 1996-1997: Slovenia], p. 91.
493. Križanič, Oplotnik, Ekonometrična ocena [Econometric Assessment], pp. 25-35.
494. Rus, Veljko. Podjetizacija in socializacija države [The Enterprisation and Socialization of the State]. Ljubljana: Theory and Practice Book Collection/Faculty of Social Sciences, 2001, pp. 126-129.
495. Prašnikar, Janez, Domadenik, Polona, Svejnar, Jan. Prestrukturiranje slovenskih podjetij v poprivatizacijskem ob dobju [Restructuring ofSlovenian Companies in the Post-Privatization Period] In: Prašnikar, Janez (ed.). Poprivatizacijsko obnašanje slovenskih podjetij [PostPrivatization Behaviour of Slovenian Companies]. Ljubljana: Gospodarski vestnik [Economic Journal], 1999 (Hereinafter: Prašnikar, Domadenik, Svejnar, Prestrukturiranje slovenskih podjetij [Restructuring of Slovenian Companies]. In: Prašnikar (ed.), Poprivatizacijsko obnašanje slovenskih podjetij [Post-Privatization Behaviour of Slovenian Companies]), pp. 251-273.
496. Bešter, Janez. Prevzemi podjetij in njihovi učinki na delničarje, managerje, zaposlene, upnike in državo [Takeovers of Companies and Their Effects on Shareholders, Managers, Employees, Creditors and the State]. Ljubljana: Gospodarski vestnik [Economic Journal], 1996, p. 143.
497. Simoneti, Marko, Rojec, Matija, Rems, Marko. Lastniška struktura podjetij ob privatizaciji [Ownership Structure of Companies at the Time of Privatization.]. Ekonomsko ogledalo [Slovenian Economic Mirror], Vol. 7, No. 5, IMAD, 2001, p. 11.
498. Simoneti, Marko, Rojec, Matija, Rems, Marko. Koncentracija lastništva v podjetjih ob privatizaciji [Concentration of Ownership in Companies at the Time of Privatization]. Ekonomsko ogledalo [Slovenian Economic Mirror], Vol. 7, No. 6, IMAD, 2001, p. 8.
499. Simoneti, Marko, Rojec, Matija, Rems, Marko. Koncentracija lastništva v podjetjih leta 1999 [Concentration of Ownership in Companies in 1999]. Ekonomsko ogledalo [Slovenian Economic Mirror], Vol. 7, No. 7, IMAD, 2001, p. 7.
500. Izjava Mirana Potrča [Statement by Miran Potrč]. Informativna oddaja Omizje (Ko se decembra zgosti čas.) [Omizje News Programme (When Time Thickens in December.)], TV SLO 1, 26 December 2007. URL: http://www.rtvslo.si/modload.php?&c_mod=rtvoddaje&op=web&func=read&c_id=175. (8 January 2008).
501. Izjava dr. Franceta Bučarja [Statement by Dr. France Bučar]. Informativna oddaja Omizje (Ko se decembra zgosti čas .) [Omizje News Programme (When Time Thickens in December .)]. TV SLO 1, 26 December 2007. URL: http://www.rtvslo.si/modload.php?&c_mod=rtvoddaje&op=web&func=read&c_id=175. (8 January 2008).
502. Borak, Spočetje ekonomske samostojnosti [Conception of Economic Independence], p. 167.
503. “Old Boys Network” - a derogatory label for influential people who, on the basis of social and business connections, acquired large assets during the time of transition.
504. Statement by Dr. Dimitrij Rupel.
505. Official Gazette of the Republic of Slovenia, 42/1993.
506. Official Gazette of the Republic of Slovenia, 42/2007.
507. Official Gazette of the Republic of Slovenia, 42/2002.
508. Official Gazette of the Republic of Slovenia, 25/2008.
509. Website of the Ministry of the Economy. URL: http://www.mg.gov.si/si/zakonodaja_in_dokumenti/notranji_trg/drugi_pomembni_dokumenti/register_pogodb_po_zuddob/ (25 July 2009).
510. Franca, Valentina, Globočnik, Nina. Vsebina pogodbe o udeležbi delavcev pri dobičku [Contents of the Agreement on Employee Participation in Profits]. Industrijska demokracija [Industrial Democracy], No. 10, 2008, pp. 4-8.
511. Lorenčič, Aleksander. Lastniška struktura v podjetjih in participacija delavcev v njej po osamosvojitvi Slovenije [Ownership Structure in Companies and Employee Participation in It after the Independence of Slovenia]. Svobodna misel [Free Thought], Vol. 18, No. 21; Appendix: Vol 1, No. 21, 13 November 2009, p. 12.
512. Glušič, Tanja. Delitev dobička delavcem [Distribution of Profits to Workers]. In: Pravna praksa: Časopis za pravna vprašanja [Legal Practice, Journal for Legal Issues], Vol. 28, No. 2, 2009, pp. 9-11.
513. Kanjuo-Mrčela, Aleksandra. Lastništvo zaposlenih na prelomu tisočletja [Employee Ownership in Slovenia at the Beginning of the Millennium]. Industrijska demokracija [Industrial Democracy], Vol. 6, No. 10, 2002, pp. 21-24.
514. Dejstva o (menedžerskih) prevzemih podjetij. Primer: Slovenija [Facts about (Managerial) Takeovers of Companies. Example: Slovenia], Ljubljana: Federation of Free Trade Unions of Slovenia, 31 January 2011, p. 2.
515. Official Gazette of the Republic of Slovenia, 47/1997.
516. Lorenčič, Prinčič, Slovenska industrija [Slovenian Industry], pp. 110-112.
517. Lorenčič, Aleksander. Slovenski sindikati in prehod v kapitalizem [Slovenian Trade Unions and the Transition to Capitalism]. In: Kavčič, Franček (ed.). Delavsko gibanje in delavska enotnost: zbornik ob 75-letnici Delavske enotnosti [The Workers' Movement and Workers' Unity: Journal on the Occasion of the 75th Anniversary of Workers' Unity]. Ljubljana: Federation of Free Trade Unions of Slovenia, 2017, pp. 172-179.
518. Spletna stran Republike Srbije/gospodarstvo [Website of the Republic of Serbia/economy]. URL: http://www.ambasadasrbije.si/srbsko_gospodarstvo.html (30 June 2010).
519. Lorenčič, Aleksander. Aspects of Economic Transition Illustrated by Examples from Slovenia, Serbia and Croatia. Etudes balkaniques: revue trimestrielle [Balkan Studies: Quarterly Review]. 2016, Vol. 52, No. 3, pp. 499-526.
520. Novkovic, Goran. Intervju z Andrejo Böhm [Interview with Andreja Böhm]. Agens, No. 64, November 1998 (Hereinafter: Novkovic, Interview with Andreja Böhm), pp. 2-5.
521. Šušteršič, Politično gospodarski cikli [Political and Economic Cycles], pp. 211-222.
522. Novkovic, Interview with Andreja Böhm, pp. 2-5.
523. Simoneti et al., Spremembe v strukturi in koncentraciji lastništva [Changes in the Structure and Concentration of Ownership], pp. 10-11.
524. Mencinger, Deset let pozneje [Ten Years After], p. 32.