pca case no. 2012-04 in the matter of an arbitration under the arbitration agreement between the

398 Pages·2017·7.37 MB·English

PCA CASE NO. 2012-04

IN THE MATTER OF AN ARBITRATION UNDER THE ARBITRATION AGREEMENT
BETWEEN THE GOVERNMENT OF THE REPUBLIC OF CROATIA AND THE
GOVERNMENT OF THE REPUBLIC OF SLOVENIA, SIGNED ON 4 NOVEMBER 2009

- between -

THE REPUBLIC OF CROATIA

- and -

THE REPUBLIC OF SLOVENIA

(together, the “Parties”)

________________________________________________________

FINAL AWARD

29 June 2017
________________________________________________________

ARBITRAL TRIBUNAL:
Judge Gilbert Guillaume (President)
Ambassador Rolf Einar Fife
Professor Vaughan Lowe
Professor Nicolas Michel
Judge Bruno Simma

REGISTRAR:
Dr. Dirk Pulkowski
The Permanent Court of Arbitration

TABLE OF CONTENTS
I. INTRODUCTION ........................................................................................................................ 1
A. GENERAL GEOGRAPHY ...................................................................................................... 1
B. HISTORICAL BACKGROUND ............................................................................................... 3
1. Historical Developments up to the 18th Century ....................................................... 3
2. The Austrian Empire and the Austro-Hungarian Empire (1804-1918) .................. 3
3. The Kingdom of Serbs, Croats and Slovenes (1918-1929) ........................................ 4
4. The Kingdom of Yugoslavia (1929-1941) ................................................................... 5
5. The Yugoslav Territory During World War II.......................................................... 6
6. The Yugoslav Federation (1945-1991) ........................................................................ 6
7. Independence ................................................................................................................ 9
C. EVENTS AFTER 1991 ......................................................................................................... 10
1. The Draft Border Agreement Allegedly Proposed by Slovenia in 1991 ................ 12
2. Negotiations in 1992-1993 .......................................................................................... 13
3. The Parties’ Expert Groups ....................................................................................... 15
4. Slovenia’s 1993 Memorandum on the Bay of Piran and Croatia’s Reaction ........ 16
5. Joint/Mixed Diplomatic Commission and Expert Group ....................................... 18
6. The 1997 Agreement on Local Border Traffic and Cooperation ........................... 23
7. Negotiations in 1998-1999 .......................................................................................... 25
8. The 2001 Drnovšek-Račan Agreement ..................................................................... 27
9. Negotiation of the Arbitration Agreement ............................................................... 29
10. Conclusion and Ratification of the Arbitration Agreement ................................... 42
II. HISTORY OF THE PROCEEDINGS ..................................................................................... 47
III. THE PARTIES’ FORMAL REQUESTS ................................................................................. 59
A. CROATIA’S REQUESTS...................................................................................................... 59
1. The Land Boundary ................................................................................................... 59
2. The Maritime Issues ................................................................................................... 60
3. Reservation of Rights ................................................................................................. 61
B. SLOVENIA’S REQUESTS .................................................................................................... 61
1. The Land Boundary ................................................................................................... 61
2. The Maritime Issues ................................................................................................... 65
3. Objection to the Tribunal’s Jurisdiction .................................................................. 67
IV. DETERMINATIONS IN RESPECT OF THE LAND BOUNDARY ................................... 69
A. THE TASK OF THE TRIBUNAL AND THE APPLICABLE LAW ........................................... 69
1. The Parties’ Positions ................................................................................................. 69
PCA 200993 i
Task of the Tribunal .............................................................................................. 69
i. Croatia’s Position ............................................................................................... 69
ii. Slovenia’s Position ............................................................................................. 74
Applicable Law ...................................................................................................... 79
i. Uti possidetis ...................................................................................................... 79
ii. Domestic Law Governing the Boundaries of the Former Republics on the
Critical Date ....................................................................................................... 82
Federal Rules of the FPRY and the SFRY ............................................................... 82
Applicable Rules in Croatia .................................................................................... 84
Applicable Rules in Slovenia ................................................................................... 86
iii. The Parties’ Interpretations of the Legal Framework ......................................... 88
Croatia’s Position ................................................................................................... 88
Slovenia’s Position .................................................................................................. 97
2. The Tribunal’s Analysis ........................................................................................... 108
The Obligation to Follow the Pre-independence Boundary ............................ 108
Areas of the Land Boundary Not in Dispute ..................................................... 111
The Disputed Segments of the Land Boundary ................................................ 112
Limits to the Tribunal’s Determinations ........................................................... 113
B. DISPUTED SEGMENTS OF THE LAND BOUNDARY ......................................................... 114
1. Mura River Region ................................................................................................... 115
Delimitation in the Mura River Region as a Whole ......................................... 124
i. The Parties’ Positions ....................................................................................... 124
ii. The Tribunal’s Analysis ................................................................................... 125
Brezovec-del/Murišće .......................................................................................... 127
i. The Parties’ Positions ....................................................................................... 127
ii. The Tribunal’s Analysis ................................................................................... 131
Podturen/Pince, Novakovec/Pince, and Ferketinec/Pince ................................ 136
i. The Parties’ Positions ....................................................................................... 136
ii. The Tribunal’s Analysis ................................................................................... 140
Mursko Središće and Peklenica.......................................................................... 144
i. The Parties’ Positions ....................................................................................... 145
ii. The Tribunal’s Analysis ................................................................................... 145
2. Central Region .......................................................................................................... 145
Slovenske gorice ................................................................................................... 152
i. Razkrižje ........................................................................................................... 152
The Parties’ Positions ........................................................................................... 153
PCA 200993 ii
The Tribunal’s Analysis ......................................................................................... 154
ii. Robadje/Globoka .............................................................................................. 155
The Parties’ Positions ........................................................................................... 155
The Tribunal’s Analysis ......................................................................................... 156
iii. Santavec River .................................................................................................. 156
iv. Zelena River ..................................................................................................... 158
v. The Remaining Part of the Slovenske gorice ................................................... 158
Drava River .......................................................................................................... 158
i. The Parties’ Positions ....................................................................................... 159
ii. The Tribunal’s Analysis ................................................................................... 161
Haloze-Macelj ...................................................................................................... 162
i. The Parties’ Positions ....................................................................................... 162
ii. The Tribunal’s Analysis ................................................................................... 163
Sotla River ............................................................................................................ 164
i. The Parties’ Positions ....................................................................................... 165
ii. The Tribunal’s Analysis ................................................................................... 168
Sava and Bregana Rivers .................................................................................... 170
i. Area 6.1 ............................................................................................................ 171
The Parties’ Positions ........................................................................................... 171
The Tribunal’s Analysis ......................................................................................... 172
ii. Junction of the Sava and Bregana Rivers ......................................................... 173
The Parties’ Positions ........................................................................................... 173
The Tribunal’s Analysis ......................................................................................... 174
Gorjanci/Žumberak ............................................................................................ 176
i. Brezovica pri Metliki ........................................................................................ 178
The Parties’ Positions ........................................................................................... 179
The Tribunal’s Analysis ......................................................................................... 180
ii. Settlement of Drage (Sekulići/Sekuliči) ........................................................... 183
The Parties’ Positions ........................................................................................... 183
The Tribunal’s Analysis ......................................................................................... 184
iii. Trdinov Vrh/Sveta Gera ................................................................................... 187
The Parties’ Positions ........................................................................................... 187
The Tribunal’s Analysis ......................................................................................... 189
Kamenica, Kupa/Kolpa and Čabranka Rivers ................................................. 190
i. Kamenica River ................................................................................................ 191
The Parties’ Positions ........................................................................................... 191
PCA 200993 iii
The Tribunal’s Analysis ......................................................................................... 192
ii. Kupa/Kolpa River............................................................................................. 194
The Parties’ Positions ........................................................................................... 194
The Tribunal’s Analysis ......................................................................................... 195
iii. Čabranka River ................................................................................................. 195
The Parties’ Positions ........................................................................................... 195
The Tribunal’s Analysis ......................................................................................... 196
Črneča Vas ........................................................................................................... 198
Novi Kot/Prezid, Draga/Prezid, Babno Polje/Prezid ........................................ 201
i. Draga/Prezid and Novi Kot/Prezid ................................................................... 201
The Parties’ Positions ........................................................................................... 201
The Tribunal’s Analysis ......................................................................................... 202
ii. Babno Polje/Prezid ........................................................................................... 202
The Parties’ Positions ........................................................................................... 202
The Tribunal’s Analysis ......................................................................................... 203
3. Istria Region .............................................................................................................. 204
Leskova Dolina and Snežnik/Prezid .................................................................. 209
i. The Parties’ Positions ....................................................................................... 211
ii. The Tribunal’s Analysis ................................................................................... 213
Gomance ............................................................................................................... 216
Klana/Lisac and Zabiče/Sušak as well as Lisac/Sušak ..................................... 219
i. The Parties’ Positions ....................................................................................... 220
ii. The Tribunal’s Analysis ................................................................................... 222
Kućibreg/Topolovec ............................................................................................ 225
i. The Parties’ Positions ....................................................................................... 226
ii. The Tribunal’s Analysis ................................................................................... 227
Merišće and Krkavče as well as Lower Dragonja Region ............................... 229
i. The Parties’ Positions ....................................................................................... 230
ii. The Tribunal’s Analysis ................................................................................... 238
V. DETERMINATIONS IN RESPECT OF THE BAY ............................................................ 243
A. THE PARTIES’ POSITIONS .............................................................................................. 243
1. Status of the Bay Prior to the Dissolution of the SFRY ........................................ 243
2. Effect of the Dissolution of the SFRY ..................................................................... 247
The Concept of “Juridical Bays” by Reference to Article 7 of the 1958 Geneva
Convention and UNCLOS Article 10 ................................................................. 248
PCA 200993 iv
Relevance of Article 11 of the Vienna Convention on Succession of States in
respect of Treaties ................................................................................................ 250
The Concept of “Historic Bays” ......................................................................... 254
3. Applicable Law with respect to the Delimitation of the Bay ................................ 259
4. Effectivités in the Bay ............................................................................................... 261
5. Regime for the Use of the Bay ................................................................................. 267
B. THE TRIBUNAL’S ANALYSIS .......................................................................................... 267
1. Status of the Bay ....................................................................................................... 267
Status of the Bay Prior to the Dissolution of the SFRY ................................... 268
Effect of the Dissolution of the SFRY ................................................................ 272
2. Delimitation within the Bay ..................................................................................... 273
3. Regime for the Use of the Bay ................................................................................. 281
VI. DETERMINATIONS IN RESPECT OF OTHER MARITIME AREAS .......................... 283
A. TASK OF THE TRIBUNAL AND APPLICABLE LAW ......................................................... 283
1. The Parties’ Positions ............................................................................................... 283
Relationship between Article 3(1) and Article 4 ............................................... 283
Relevance of the Concept of “Vital Interests” .................................................. 288
Applicable Law .................................................................................................... 289
2. The Tribunal’s Analysis ........................................................................................... 291
B. DELIMITATION OF THE TERRITORIAL SEA................................................................... 292
1. The Parties’ Positions ............................................................................................... 293
Applicable Law with respect to the Delimitation of the Territorial Sea......... 293
Existence of Historic Title ................................................................................... 295
Existence of Special Circumstances ................................................................... 298
i. The “Squeezing Effect” .................................................................................... 298
ii. Coastal Concavity............................................................................................. 300
iii. The “Cut-Off Effect” ........................................................................................ 303
iv. Security and Navigational Interests .................................................................. 305
Course of the Maritime Boundary ..................................................................... 306
2. The Tribunal’s Analysis ........................................................................................... 311
C. DETERMINATION OF “SLOVENIA’S JUNCTION TO THE HIGH SEA” ............................ 324
1. The Parties’ Positions ............................................................................................... 324
Meaning of “Junction to the High Sea” ............................................................. 324
i. Croatia’s Position ............................................................................................. 324
ii. Slovenia’s Position ........................................................................................... 329
PCA 200993 v
Circumstances to Be Taken into Account under Article 4(b) of the Arbitration
Agreement ............................................................................................................ 331
i. Croatia’s Position ............................................................................................. 331
ii. Slovenia’s Position ........................................................................................... 335
Determination of “Slovenia’s Junction to the High Sea” ................................. 336
i. Croatia’s Position ............................................................................................. 336
ii. Slovenia’s Position ........................................................................................... 337
2. The Tribunal’s Analysis ........................................................................................... 340
“High Sea” ............................................................................................................ 340
“Junction” ............................................................................................................ 342
The Location of “Slovenia’s Junction to the High Sea” ................................... 344
D. DELIMITATION OF THE CONTINENTAL SHELF ............................................................. 348
1. The Parties’ Positions ............................................................................................... 348
Entitlement to a Continental Shelf ..................................................................... 348
i. Slovenia’s Position ........................................................................................... 348
ii. Croatia’s Position ............................................................................................. 349
Applicable Law with respect to the Delimitation of the Continental Shelf .... 350
Proposed Limits of the Continental Shelf .......................................................... 352
2. The Tribunal’s Analysis ........................................................................................... 354
E. DETERMINATION OF THE REGIME FOR THE USE OF THE RELEVANT MARITIME
AREAS .............................................................................................................................. 354
1. The Parties’ Positions ............................................................................................... 355
Regime for the Use of the Territorial Sea .......................................................... 355
i. Slovenia’s Position ........................................................................................... 355
ii. Croatia’s Position ............................................................................................. 357
Regime for the Use of the Continental Shelf ..................................................... 358
Regime for the Use of the High Seas .................................................................. 359
2. The Tribunal’s Analysis ........................................................................................... 360
Regime of the Junction Area .............................................................................. 360
i. The Content and Scope of the Freedoms of Communication ........................... 360
ii. Guarantees of, and Limitations to, the Freedoms of Communication .............. 361
iii. Duty of Cooperation and Other Agreements between the Parties .................... 362
Regime for the Use of the Continental Shelf ..................................................... 364
Regime for the Use of the High Seas .................................................................. 364
VII. COSTS OF THE ARBITRATION ......................................................................................... 365
VIII. DISPOSITIF ............................................................................................................................. 367
PCA 200993 vi
AWARD MAPS
Map I: Course of the Boundary South of Brezovec-del/Murišće 135
Map II: Mouth of the Dragonja and the Bay 280
Map III: Equidistance Line 314
Map IV: Claims of the Parties 317
Map V: General Coastal Projections 320
Map VI: Maritime Boundary 323
Map VII: Junction Area 347
PCA 200993 vii