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Arbitration

Photo: Alan Copson - GettyImages/GulliverFilm&Foto

As Slovenia and Croatia had not managed to resolve their dispute concerning the border on land and sea despite numerous attempts, on 4 November 2009 they, with the assistance of the European Commission, signed the Arbitration Agreement establishing an Arbitral Tribunal.

In accordance with Article 3 of the Arbitration Agreement, the Arbitral Tribunal had to determine:

the course of the maritime and land boundary between the Republic of Slovenia and the Republic of Croatia,
Slovenia's junction to the High Sea, and
the regime for the use of the relevant maritime areas.

Article 4 of the Arbitration Agreement also bound the arbitrators to apply, in making decisions concerning said junction and regime, the rules and principles of international law, as well as equity and the principle of good neighbourly relations in order to reach a fair and just decision. They had to take into account all relevant circumstances.

On 29 June 2017 the Arbitral Tribunal in the Hague delivered its Final Award in the arbitration between the Republic of Slovenia and the Republic of Croatia determining the course of the maritime and land boundary between the two countries.

In accordance with the Arbitration Agreement and the principles of international law, the Tribunal’s Award is final and legally binding on the two parties.

What did the Arbitral Tribunal determine?

In the Final Award the Arbitral Tribunal determined the course of the entire land boundary between Slovenia and Croatia.

In accordance with the Arbitration Agreement, in delimiting the land border, the Tribunal applied international law and, within this framework, the principle of uti possidetis, which after the break-up of a country allows for the conversion of former administrative borders into international borders.

The Tribunal also determined the maritime boundary between the two countries, which had never been delimited before.

In this the Tribunal applied international law, as set out by the Arbitration Agreement. The Bay of Piran retained the status of internal waters and the border in the Bay was determined in accordance with the principle of uti possidetis.

The border between the territorial seas of Slovenia and Croatia is a modified equidistance line.

The Arbitral Tribunal determined Slovenia's junction to the high seas.

In doing so, it applied international law, equity and the principle of good neighbourly relations in order to reach a fair and just decision, taking into account all relevant circumstances.

It determined the junction to be the area that connects Slovenia’s territorial sea to the high seas. In the junction area there is freedom of communication for all ships and aircraft, equally and without discrimination on grounds of nationality, for the purpose of access to and from Slovenia.

Implementation of the Arbitration Award

Despite Croatia's refusal to implement the Arbitration Award, Slovenia is doing everything necessary to implement it:

it has established an inter-ministerial coordination group for the implementation of the Final Award,
it is devoting special attention to the people living in the border region who have been directly affected by the Award,
it is committed to dialogue with Croatia with regard to the implementation of the Award,
through diplomatic efforts in the international community, it is endeavouring to ensure that Croatia upholds the Award.

Action against Croatia under Article 259 TFEU

Croatia's refusal to recognise the Arbitration Award and implement it is in contravention of European law. By not respecting the Arbitration Award and thus the rule of law, Croatia is also violating the fundamental principles of the European Union. Therefore, Slovenia initiated proceedings against Croatia under Article 259 of the Treaty on the Functioning of the European Union (TFEU). As the European Commission did not deliver a reasoned opinion within the three-month limit, on 13 July 2018 Slovenia filed an action against Croatia for the infringement of an obligation under Article 259 TFEU.

Chronology:

On 16 March 2018 Slovenia submitted a letter to the European Commission under Article 259 TFEU, informing it of Croatia's violations of EU law and calling on it to act.
By 17 April 2018, at the request of the European Commission, Croatia submitted its observations on the specific violations of EU law referred to in Slovenia's letter to the European Commission.
On 2 May 2018 the European Commission called an oral hearing, where both Slovenia and Croatia orally presented and further explained their positions.
On 18 June 2018 the three-month time limit for the European Commission to deliver a reasoned opinion under Article 259 TFEU expired. The European Commission did not deliver a reasoned opinion by this date.
On 13 July 2018 Slovenia filed an action against Croatia for the infringement of an obligation under Article 259 TFEU.

Six months later Slovenia received the response of Croatia and has already replied thereto.

History of determining the border between Slovenia and Croatia

the course of the maritime and land boundary between the Republic of Slovenia and the Republic of Croatia,
Slovenia's junction to the High Sea and
the regime for the use of the relevant maritime areas.

Article 4 of the Arbitration Agreement also bound the arbitrators to apply, in making decisions concerning the junction and regime, the rules and principles of international law, as well as equity and the principle of good neighbourly relations in order to reach a fair and just decision. They had to take into account all relevant circumstances.

The process of resolving the border dispute between Slovenia and Croatia can be divided into the following periods:

the period 1992–2002, which ended with the Drnovšek-Račan Agreement,
2002–2008, when the governments of both countries negotiated the resolution of the dispute with the help of a third party,
2008–2009, when the Arbitration Agreement was signed,
2010–2014, when the Arbitration Agreement entered into force and the substantive phase of the arbitration procedure took place,
the period after July 2015, when (following the eavesdropping scandal) Croatia announced that it intended to unilaterally withdraw from the Arbitration Agreement,
the period after 29 June 2017, when the Arbitral Tribunal delivered the Final Award.

Chronological overview of the resolution of the border dispute

How did the arbitration unfold?

Slovenia and Croatia concluded an agreement to refer the unresolved border issue to an arbitral tribunal. According to the Agreement, the Permanent Court of Arbitration Optional Rules for Arbitrating Disputes between Two States were to be applied, unless otherwise determined by the Agreement. The countries also agreed that the Permanent Court of Arbitration (PCA) in the Hague would act as the Secretariat of the Arbitral Tribunal.

On 11 February 2013 the written part of the proceedings began with the submission of memorials to the Arbitral Tribunal, in which the two countries presented their positions regarding the course of the border. The content of these documents is not public (as under paragraph five of Article 6 of the Arbitration Agreement the arbitration proceedings are confidential). The Slovenian memorial consists of more than 650 pages, with an additional 5200 pages of annexes and 250 pages of maps, while the Croatian memorial is over 3600 pages long.

When the memorials were exchanged, a new round of proceedings began – the drafting of counter-memorials, i.e. the responses to the factual and legal positions of the opposing side.

On 26 March 2014 Slovenia and Croatia exchanged their responses to the counter-memorials, as the rules allow arbitrators to permit one additional round in the written proceedings, i.e. a response to a counter-memorial. On the proposal of Slovenia, the Arbitral Tribunal approved the drafting of a response to further explain the facts and the newly submitted documents.

The oral hearing before the Arbitral Tribunal took place from 2 to 13 June 2014 at the Palace of Peace, the seat of the Permanent Court of Arbitration, in the Hague.

A summary of the positions of both parties is included in the press release of 17 June 2014 of the Permanent Court of Arbitration.

Start 4. 11. 2009
Institution Government of the Republic of Slovenia

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