Krško Nuclear Power Plant – Another Croatia-Slovenia Dispute

By 25 April 2018

ZAGREB, April 25, 2018 - The Slovenian and Croatian co-owners of the Krško Nuclear Power Plant – Slovenia's GEN Energija and Croatia's HEP power provider – did not manage to reach agreement on appointing the plant's new two-member management board on Wednesday, however, they agreed to resume talks on the matter after the completion of the regular overhaul of the plant.

We will try to reach an internal agreement, Gen Energija management board chair Martin Novšak was quoted by the STA news agency as saying. Novšak confirmed that the candidate nominated by Croatia's HEP was perceived by the Slovenian side as unacceptable.

On the other hand, HEP insists on an early cancellation of the term of the current Croatian representative on the board, Hrvoje Perharić.

HEP management board chairman Frane Barbarić said today in Krško that each of the two owners was entitled to propose their candidates for the two-member management board. "Croatia has chosen a nominee who meets all international criteria and terms and conditions of the bilateral contract on the Krško plant," Barbarić said, adding that HEP found it unacceptable that Slovenia was imposing its opinion and advocating that Perharić should continue representing Croatia on the plant's management board.

HEP also has reservations concerning the age of the current two management board members who meet conditions for retirement.

The Croatian side holds a grudge against Perharić for under-representation of Croatian companies in jobs concerning the maintenance and reconstruction of the Krško complex.

Ivan Vrdoljak, leader of the Croatian People's Party (HNS), a junior partner in the ruling coalition, has said recently that Perharić has worked for the interests of Slovenia and caused two billion kuna worth of damage to the Croatian state budget during his term as a board member.

Vrdoljak made the accusations at a news conference in Zagreb after the Zagreb Municipal Prosecutor's Office upheld an indictment against Vrdoljak brought by Perharić who accused Vrdoljak of threatening him in 2015, when Vrdoljak served as Economy Minister. Vrdoljak said that, under the Croatian-Slovenian agreement on the Krško power plant, half of the business activities pertaining to the plant should be performed by Slovenian companies and the other half by Croatian ones. However, from 2010 to 2014, this ratio was 61% to 23% to the detriment of Croatia, which prompted Vrdoljak to react.

"During Perharić's term as the Croatian representative on the board, Croatia lost over two billion kuna. In 2015, I acted to protect Croatia's national interests, jobs, entrepreneurs and companies. The complaint filed by Perharić against me is based on a false statement and I will prove it. Democratic institutions are the pillars of a democratic system, and I respect the institutions but I reject the complaint against me," Vrdoljak said.

The HNS chief called on law enforcement authorities to investigate whether the Croatia-Slovenia agreement was complied with. Vrdoljak insisted that the charges brought against him by Perharić were motivated by Perharić's attempt to discredit him after he said that Perharić should be held to account.

On Tuesday, Perharić claimed that Vrdoljak's allegations were based on a separate page of a report adopted at a session of the Krško plant's management board on the implementation of the international agreement, adding that there had not been any objections to the report at the session which Vrdoljak himself had attended. Perharić added that the alleged amount of damage to Croatia Vrdoljak was bandying around was ridiculous.

He also denied claims that he was in a conflict of interest, saying that he was not the founder and did not have any shares in the Enconet company, which has been the Krško plant's subcontractor for nearly 30 years. Perharić explained that he did establish the Enteko company, however, that company never had anything to do with Enconet. Perharić said that Enteko's founding capital was transferred to Enconet prior to his appointment to the Krško power plant's management board.