Europe Country News. September 30-October 7 2011

CROATIA

• Thursday 6: The European Commission has called on Croatia to exercise caution in considering a bill declaring null and void all legal documents of the former Yugoslav People's Army and the judicial bodies of the former Jugoslav Federation and the Republic of Serbia in which Croatian are suspects, indictees or convicts. This measure could jeopardise regional cooperation in the prosecution of war crimes.

GERMANY

• Thursday 6: The German Gov. is considering resuscitating the bank rescue fund Soffin in order to be prepared for the new banking crisis. The Soffin was created after 2008 and equipped with €80bn for capital injections and could provide guarantees for up to €400bn for German financial institutions in order to help ailing banks to survive. It has since ended its life and was replaced by the restructuring law which is mainly there to unwind banks in an orderly manner, not to help them survive.

HUNGARY

• Saturday 1: Thousands of demonstrators gathered in Budapest to protest against the labour- and tax-related regulation passed by parliament and part of the new constitution due to come into force in 2012.

• Monday 3: The National Bank will sell euros to banks that have retail FX mortgages regularly at tenders held weekly or, if needed, more frequently between Oct. 3 and Feb. 29, 2012, to provide banks with the necessary foreign exchange to meet borrowers demand for early full repayment of FX mortgages at a discounted exchange rate.

• Monday 3: Prosecutors have criminally charged former PM Gyurcsany with abusing the powers of his office in relation to a casino investment in central Hungary's Sukoro. Gyurcsany stated earlier that he is innocent of any charges and that he was ready to defend himself in court.

• Tuesday 4: Moody’s placed seven Hungarian banks (OTP Bank and its mortgage unit, FHB, K&H (KBC Groep), BB (General Electric), Erste Group Bank AG and MKB (Bayerische Landesbank) on review for a downgrade on concern that exchange-rate losses from a government mortgage plan may erode their profitability. Meanwhile, Fitch Ratings also said the scheme poses risks to the country's banking sector and may damage its reputation among investors.

• Wednesday 5: Hungary's Bank Association is referring the law, incorporating the government’s plan to allow forex debtors to repay their debt early and fully, to the Constitutional Court, asking the court to establish that the law concerned is against Hungary's constitution.

• Thursday 6: Parliamentarians called on the country’s competition authority and financial market supervisor to start investigations against banks on suspicion that they formed a cartel when raising interest rates and fees on household forint loans in recent days, as it occurred almost at the same time and raise the suspicion of coordinated action.

KAZAKHSTAN

• Friday 30: Workers’ leaders from Kazakhstan are taking their case to Europe (appealing for example last week to the OSCE’s annual human rights conference) amid an increasingly brutal crack down by President Nazarbayev’s government against protesting oil workers in the Central Asian country.

• Wednesday 5: Kazakhstan will not drop its tax claim against the Western-led consortium developing the Karachaganak oil and gas field, Oil and Gas Minister Sauat Mynbayev said, raising questions whether the long-running dispute can be resolved in the near future.

• Thursday 6: Judges of Almaty’s Court ruled that leading members of the country's Communist Party had "participated in actions beyond allowed mandate," and ordered a six month ban on party activity effective immediately.


ROMANIA

• Saturday 1: Romania introduced a new civil code to replace the former version, which dated from 1864.

RUSSIA

• Monday 3: President Medvedev continued a government reshuffle by dismissing a deputy chief of the armed forces' General Staff who reportedly disagreed with the Kremlin's military reforms.

SERBIA

• Friday 30: The IMF’s Executive Board approved a €1.1bn precautionary 18-month stand-by arrangement. The agreement will be used as a buffer against external shocks and will also provide an anchor for the country’s fiscal policies.

• Monday 3: Budapest threatened to pull its support for Belgrade's bid to join the EU if the Serbian parliament fails to modify a Serbian law on the return of property confiscated by the Communist regime after World War II which says it discriminates against the Hungarian minority.

• Tuesday 4: Council of Europe Secretary General Jagland expressed his surprise over the decision of Serbia to ban all public gatherings on October 2, including the Pride Parade, and requested from Serbian President Tadic to offer a clarification regarding the reason for such a measure.

• Thursday 6: The Parliamentary Assembly of the Council of Europe adopted a resolution demanding an urgent and objective investigation into the incident at the Jarinje administrative checkpoint in northern Kosovo-Metohija on Sept.27, 2011, urging the authorities in Belgrade and Pristina to resume the EU-mediated dialogue on all outstanding issues including the situation in North Kosovo.

SLOVAKIA

• Tuesday 4: Parties in center-right government failed to overcome a rift over a plan to expand the euro zone's financial safety net but said more talks would be held ahead of a ratification vote in parliament next week. Without Slovakia's approval, the EFSF's expanded powers cannot go live, a point that highlights the euro zone's tortuous decision-making process.

TURKEY

• Wednesday 5: The Parliament extended -further 12 months- the government's mandate to order military strikes against the armed separatist PKK in northern Iraq.

UKRAINE

• Tuesday 4: The ruling Party of Regions deputies are to seek decriminalisation of the Article 365 of the Penal Code – which is the article that former prime minister Tymoshenko is currently charged with in her ongoing trial. If approved, the new law will not consider economic offences as criminal acts punishable by heavy convictions—the most likely form of punishment will be a fine.