INTERNATIONAL LAW, Sixth edition

988 international law
be had to the domestic law of the SFRY in operation at the date of succession’.
166 The relevant date for the passing of the property is the date
of succession 167 and this is the date of independence, although difficulties
may arise in the context of the allocation of assets and debts where
different dates of succession occur for different successor states. 168 Such
problems would need to be resolved on the basis of agreement between
the relevant parties. 169
The Arbitration Commission was faced with two particular problems.
First, the 1974 SFRY Constitution had transferred to the constituent republics
ownership of many items of property. This, held the Commission,
led to the conclusion that such property could not be held to have belonged
to the SFRY whatever their origin or initial financing. 170 Secondly,
the Commission was faced with the concept of ‘social ownership’, a concept
regarded as particularly highly developed in the SFRY. In the event, the
Commission resolved the dilemma by adopting a mixture of the territorial
principle and a functional approach. It was noted that ‘social ownership’
was ‘held for the most part by “associated labour organisations” – bodies
with their own legal personality, operating in a single republic and coming
within its exclusive jurisdiction. Their property, debts and archives
are not to be divided for purposes of state succession: each successor state
exercises its sovereign powers in respect of them.’ 171 However, where other
organisations operated ‘social ownership’ either at the federal level or in
two or more republics, ‘their property, debts and archives should be divided
between the successor states in question if they exercised public
prerogatives on behalf of the SFRY of individual republics’. Where such
public prerogatives were not being exercised, the organisations should be
166 Opinion No. 14, 96 ILR, p. 732.
167 Note that article 10 of the Vienna Convention, 1983 provides that the date of the passing
of state property of the predecessor state is that of the date of succession of states ‘unless
otherwise agreed by the states concerned or decided by an appropriate international body’.
Article 21 repeats this principle in the context of state archives and article 35 with regard
to state debts.
168 See e.g. Arbitration Commission Opinion No. 11, 96 ILR, p. 719. Cf. the Yugoslav Agreement
on Succession Issues of June 2001, 41 ILM, 2002, p. 3. See also AY Bank Ltd v. Bosnia
and Herzegovina and Others [2006] EWHC 830 (Ch) and C. Stahn, ‘The Agreement on
Succession Issues of the Former Socialist Federal Republic of Yugoslavia’, 96 AJIL, 2002,
p. 379.
169 See the Yugoslav Agreement on Succession Issues, 2001, articles 3 and 7 of Annex A and
article 4(3) of Annex B.
170 Opinion No. 14, 96 ILR, p. 732. 171 Ibid.