Branko Maric, the Managing Partner at Maric & Co. in Sarajevo, sighs when asked for the Buzz in Bosnia & Herzegovina. "Our main concern is the very awful political situation that is reflected in the judiciary system.”
Maric notes that "we are divided country,” and says that “the Federation of Bosnia & Herzegovina is practically under blockade, as there is no parliamentary majority, and practically the government only makes laws that are most necessary.” As a result, he says, “everyone is talking about how the state is doing nothing to improve the investment climate in the country,” and that there are “too many administrative barriers.” Branko sighs again. “In theory investors need two things: A stable political system and an effective judiciary — and we don’t have either of those.” Indeed, he says, the complete administration of the judicial system is inefficient and extremely complicated.”
When he’s asked whether corruption is behind the inefficiency of the courts, Maric hesitates. “Well, first of all the court system is not efficient, that’s for sure. Is it corrupt? That's not easy to establish, because in the last 20 years they have elected lots of judges without sufficient legal knowledge. And when you get bad and stupid judgments it can be difficult to decide whether it’s based on corruption or just incompetence. Everyone’s talking about corruption, and certainly several judges have been prosecuted, but whether that’s the main problem is unclear. Either way, the point is you can’t get sufficient protection. If, as an investor, I have to wait five years to get a final decision in a court case it’s a pure catastrophe — I don’t need it at all by then."
When it’s put to him that this sounds like a good situation for the legal community, he agrees: "The end of the story is for the lawyer it’s a good situation — you can’t do anything without a good lawyer here.” Indeed, he says, “my firm is rather busy … but I would prefer if we were busy with a different kind of work. There are a lot of exits, there’s a lot of restructuring work, and a lot of labor cases because of the poor shape of the economy.” He laughs. "It’s an extremely interesting place to work — there’s always something challenging. But I would prefer the situation would not be so good in this way.”
Maric reports that "the problem is that the taxation office just wants to collect money, so they put pressure on taxpayers and very often find tax liabilities even where they don’t exist.” Ironically, Maric says, “in this respect I’m rather satisfied with the position of the courts, as in the last year something like 97% of cases the court annulled the final decision of tax authorities.” Even that doesn’t solve the problem, he says. "The problem is that the tax authority takes the money before the court case, and then after the court case it’s very difficult to get it back — and if you do get it back they give it without any interest."
In terms of the more traditional areas, Maric says there’s some activity, but not much. "Real estate is going slowly,” he says. "There are some interesting places by the seaside, but it’s still not a trend. Some people — I wouldn’t call them investors — are coming from Arab countries to buy weekend houses, but it’s not really a trend.” In addition, he says, “there is some investment in infrastructure on the highway, but there’s always problem with the tenders, with public procurements. They said they would privatize the Bosnian telecom company, but the problem is when they actually tried the prices were set too high.” Maric says that "it’s still in discussion."