MANS today filed to the Constitutional Court of Montenegro an initiative to start proceeding to review the constitutionality and legality of the Law on the highway Bar-Boljari, which was adopted in the Montenegrin parliament December 8th this year. A loan of nearly one billion US dollars was taken from China EXIM Bank for only one quarter of the highway Bar – Boljari despite warnings from local and international addresses on to what extent this construction project will burden public finances.
During the public hearing on this law MANS warned the members of the Parliament that, despite the lack of basic information about the project and financial indicators that confirm its economic justification, exists a huge problem with compliance of that document with the Constitution.
Generally, the law on the highway brings Chinese companies CCCC and CRBC that are selected as contractors leads to better and more privileged position, and the state of Montenegro in a dependent position in relation to the National Republic of China.
The Law stipulates that the contractor who is engaged in highway construction may use construction stone which gets it in the process of work without any compensation, and from custom payments of without any compensation are exempt building materials, equipment and machinery intended for highway construction. This completely bypasses the Law on Concessions that is applied on all other companies that exploit minerals, and Chinese companies are in the privileged position that does not enjoy anyone else in Montenegro. In
addition, the state in advance waives the right of revenues from concessions on a rock whose total amount is not known because there is still no accurate data on the amount of material. This is due to the fact that the contract was signed based on the conceptual and not capital project that would enable more precise calculations on how much money we give Chinese companies on this basis.
In addition, also by this Law is stipulated that foreign citizen who is employed by the contractor and engages in the construction of the highway, is exempted of the contributions for compulsory social security, by which is breached the Article 67, paragraph 1, of the Constitution of Montenegro which prescribes that social insurance of employees is mandatory. That is also a privilege that has no other company in Montenegro employing foreign citizens, and who is required to properly settles all taxes and levies.
That is violated the constitutional principle of equality and the principle that everyone is obligated to pay taxes and other levies, it is shown also by the fact that the Law on highway stipulates that the contractors are exempt from paying taxes the value on added tax, personal income tax, and sales tax profits.
Specifically, unlike the benefits prescribed by this Law in behalf of a legal person, all other legal persons and individuals pay VAT at the general rate of 19% from each sale, service and import of products. Also, all resident and non-resident individuals are taxpayers who make income in Montenegro, and legal persons in Montenegro pay income tax, whose rate is proportional and is 9% of the tax base.
Article 142, paragraph 3, of the Constitution of Montenegro prohibits disturbance and limit free competition and encouragement of unequal, monopoly or dominant position in the market. However, by this Law to Chinese companies are provided numerous benefits
thanks to which they can lower operating costs and maximize profit in Montenegro.
Accordingly, every employer in Montenegro, which employs foreign citizens and regularly pays other duties now has ground to sue the country and to seek similar treatment as Chinese companies when it comes to release of taxes and contributions.
Finally, MANS expects that the judges of the Constitutional Court of Montenegro, despite obvious political pressures to which they are exposed, will act upon this initiative, in accordance with the Constitution and laws of Montenegro, and declare unconstitutional the Law on the highway Bar-Boljare.
MANS
