BiH has been added to a list of countries investors should avoid because it has not adopted laws against money laundering and terrorism financing.
By Bedrana Kaletovic for Southeast European Times in Sarajevo -- 12/06/14
Dragan Covic, president of the BiH House of Peoples, has not scheduled a session to adopt money laundering and terrorism financing laws. He said he is not to blame for the delay. [AFP]
The Council of Europe's (CoE) Committee of Experts on the Evaluation of Anti-money Laundering and the Financing of Terrorism has warned its members against financial transactions with people and institutions in Bosnia and Herzegovina (BiH) because the country has not adopted anti-money laundering and terrorism financing legislation.
"By not implementing the money laundering law, BiH has found itself facing powerful political and financial pressure from the international community," the BiH Diaspora Party said.
Other countries on the CoE blacklist are North Korea and Iran.
"The House of Peoples of BiH adopted a motion for this law, as well as a motion for the law to make the necessary changes to the criminal law of BiH. But in order for the laws to take full effect, it is necessary for the house to adopt them, and this has not happened," said Halid Genjac, president of the Club of Bosniaks in the BiH House of Representatives.
Dragan Covic, president of the BiH House of Peoples, has yet to schedule a session to adopt the laws, Genjac said.
But Covic said it was not his fault because the legislation had been under discussion "for months" and the issue should have been resolved earlier.
After a long refusal by Republika Srpska members of parliament to approve the authorisation of the State Agency for Investigation and Protection to supervise suspicious financial transactions, the law, which was a prerequisite to the money laundering legislation, was adopted in May.
"It was not my fault. This issue should have been resolved before the Council of Europe's deadlines," Covic said. "Those who blocked the process are now washing their hands of blame."
But some do blame Covic.
"Because of one politician, and the absence of political responsibility, every financial business with BiH will be under close supervision. Sending of money from abroad will be much more complicated because the financial institutions will be careful and must implement much more control in order to check whether money has been intended for criminal purposes," Senad Sepic, Party of Democratic Action MP, said.
"The Council of the Ministers of BiH found an agreement, a law was designed that was accepted by [the CoE committee] and all institutions in BiH, but the meeting of House of Peoples never took place," said Mladen Cavar, deputy minister of security in BiH, whose duty was to inform the committee about the progress of the adoption of this law.
Without the law in place, the country and its citizens are facing dire consequences, Mehmed Bradaric, a delegate in House of Representatives of the Parliamentary Council of BiH, told SETimes.
"Consequences of the failure to adopt the law are horrific and will worsen since we will scare away potential investors in BiH," Bradaric said.
Many citizens agree.
"Our politicians don't want to comprehend the seriousness of the situation in which we find ourselves. We just had a natural disaster, and this will be an even harder blow for the low standard and the economy of the country," Resad Music, a Sarajevo citizen, told SETimes.
"Doing business abroad will be more difficult since they will view me as a potential financial terrorist first, and only later as a man who makes a living through his business," Mirsad Kajtaz, a businessman in Sarajevo, told SETimes.
What measures should BiH take to get off the CoE blacklist? Add your thoughts below.