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The privatisation programme for Kosovo is provided for in the regulation to establish the Kosovo Trust Agency (KTA). The KTA is responsible for executing UNMIK’s responsibility to administer all State, Public and Socially Owned property in the territory of Kosovo. The KTA will privatise the assets of socially owned enterprises and manage the long-term interests of Kosovo and all other assets under its control. The KTA will administer public and socially owned property on UNMIK’s behalf (as stated in regulation 1244) and will report to a Board of Directors appointed by the Special Representative of the Secretary General of the United Nations (SRSG). The KTA is able to preserve or enhance the value, viability, or corporate governance of the socially owned and public enterprises. This means that the KTA is able to: appoint and replace enterprise managers; create supervisory or managing bodies for enterprises; carry through external audits; issue instructions to management; enter into arrangements for management or reorganisation; grant concessions or leases; establish corporate subsidiaries; initiate bankruptcy proceedings.
Privatisation: two processes
For socially owned enterprises alone the KTA is able to initiate ‘Spin-Offs’ and Liquidation.
‘Spin-Off’ is a two step procedure whereby the assets of the SOE are transferred to a joint stock company initially 100% owned by the SOE. Shares in this new company are then held in trust by the KTA. The KTA is then able to sell shares to private investors. The proceeds from the sales are held in trust by the KTA, without prejudice to ownership or creditor claims against the old enterprise.
Voluntary liquidations allow an inexpensive exit from the market for those enterprises that clearly have no prospects of survival. Proceedings would be out of court following the procedures outlined in the Business Organisation Regulation. Again, proceeds of liquidations are kept in trust by the KTA. The priorities for privatisation will be those SOEs with the most attractive assets. The best performing sectors are agroprocessing which includes wineries and food processing entities, the construction materials sector and mining and metal processing.
Source: ECIKS / Kosovo Trust Agency (KTA)