While
Slovenia,
Croatia,
Bosnia and Herzegovina and
Macedonia interpreted the breakup of Yugoslavia as a definite replacement of the earlier Yugoslav socialist federation with new sovereign equal successor states, newly established
FR Yugoslavia (
Serbia and Montenegro) claimed that it is sole legal successor entitled to the assets as well as automatic memberships in international organisations and agreements of SFR Yugoslavia.
Arbitration Commission of the Peace Conference on Yugoslavia was established on 27 August 1991 providing a formal negotiating platform for the Yugoslav republics with the Commission declaring on 29 November 1991 that SFR Yugoslavia was in the process of a dissolution opening the doors for recognition of new states. The Commission received the
Single Inventory of the Assets and Liabilities of SFRY as on 31 December 1990 which was confirmed in 1993 but was rejected by Serbia and Montenegro after removal of
Milan Panić. This interpretation was rejected by the
European Community and the United States as well as any subsequent succession claims by subnational entities (
Federation of Bosnia and Herzegovina,
Republika Srpska or
Republic of Serbian Krajina). The first negotiations on succession issues of the former Socialist Yugoslavia began in 1992 within the framework of the
Working Group on Succession Issues Peace Conference on Yugoslavia. The Federal Republic of Yugoslavia interpreted the breakup of Yugoslavia as a process of serial secessions and not as a complete dismemberment of the earlier state, an interpretation rejected by the other former Yugoslav republics. The
Badinter Arbitration Committee recommended a division of assets and liabilities based on principle of
equity, referring to the 1983
Vienna Convention on Succession of States in Respect of State Property, Archives and Debt (a convention not in force which at the time was signed by only six states, including SRF Yugoslavia). This proposal was unacceptable to the Federal Republic of Yugoslavia which therefore motivated the
International Monetary Fund to develop an alternative key model which considered the economic power of republics and their contribution to the federal budget, which was accepted by all. The key determined participation of Federal Republic of Yugoslavia with 36.52%, Croatia with 28.49%, Slovenia 16.39%, Bosnia and Herzegovina with 13.20% and Macedonia with 5.20%. The negotiations were continued only in 1995. On 22 November 1995
United Nations Security Council adopted
United Nations Security Council Resolution 1022 welcoming the efforts to reach consensual agreement on state succession that will enable transfer of assets to the new states. An agreement was also reached on gold and other reserves at the
Bank for International Settlements, but the final conclusion was postponed by the beginning of the
Kosovo War. == See also ==