Our associations represent the interests of over 200,000 Slovenians (ten percent of the total population of Slovenia) and 481 citizens of the United States whose property was seized by Slovenia's communist regime after the end of World War II.


The communist regime carried out expropriations on a massive scale in the years 1945 through 1948. To achieve total economic and political control the government confiscated businesses, manufacturing plants, financial institution, apartment houses, shops, buildings, agricultural land, and forests, altogether 48,000 properties of the class enemies representing 69 percent of all capital invested in industry.

Restitution Law of 1991.

At the end of 1991, when Slovenia seceded from Yugoslavia, the Slovenian Parliament enacted the Restitution [Denationalization] Law. This important legislation held forth the promise of reinstatement of fundamental values of a democratic and civilized society: personal freedom, respect for human rights, and market economy based on private ownership without which there can be no real democracy. It was intended to make amends for the political, moral, and material wrongdoing of the communist regime, restore the seized property to its owners or their heirs and to affirm the right to personal property as provided by the Slovenian Constitution and Article 17 of the Universal Declaration of Human Rights. The promise was short lived. The communists and their political heirs soon regrouped and turned out the democratic government.[ 3] They continue to hold the majority of the responsible political and economic positions in Slovenia and are blocking in any way possible the implementation of the law. They also continue holding our property or try to transfer it to their supporters.

Slovenian Government Policy.

The Council of Europe called upon all former communist countries, such as Slovenia, to restitute unjustly confiscated properties to its original owners and repudiate the legacy of communist totalitarianism if they truly desire to become democratic countries.[4] Ironically, on December 10, 1997 -- the Human Rights Day -- Slovenia's Parliament made it clear where it stands by voting down a proposed resolution that would repudiate the country's totalitarian past. The regime wants to continue with the policy of controlling all economic resources. With all the economic resources in the hands of one party there can be no democracy. Consider how many of you could be elected if all the resources were in the hands of the other party.

Efforts to Recover our Property.

Our demands for restitution of our seized assets are confronted with a systematic obstruction of the law by the authorities, revealing the intent of the Slovenian government to continue the unjust practices of the past. In most cases we have exhausted all locally available legal remedies because the authorities simply do not move on our claims. In numerous instances the authorities refuse to return the confiscated property and continue to trade with it. As an example, consider the case of Adolf Prah, founder of a textile factory. In 1941 the Nazis deported him and family and seized his factory. When he returned in 1945, he was allowed to rebuild his factory. As soon as it was running well, the communists nationalized it. The 1946 law on nationalization provided for compensation and also allowed the owner to retain all net liquid assets. Since 1947, the owner, and later his heirs have been claiming repayment of the liquid assets. No payment has been made to this day. The case is winding through all the possible administrative and judicial obstacles an obstructionist system can devise. The government did agree to issue a substantially devalued shares of company stock but even this has not yet been delivered to the heirs. [5]

Obstruction of Restitution.

The law required that restitution be the first phase of the ongoing and by now officially completed privatization process. The record of its implementation is dismal. According to the report of the Slovenian Ministry of Justice, 53 percent of claims were granted by May of 1997. Hardly a sincere effort in implementing a six year old law. The total value of restituted property was even smaller: only 22% of the total claimed amount. Six years after the enactment of the Restitution Law, the Government still held over three quarters of claimed property amounting to $2.7 billion. Favorable decisions have been rendered mainly in cases of supporters of the regime. Filed claims or supporting documents often are conveniently lost, records of citizenship status or of confiscations cannot be located by the authorities, moratoria on processing certain classes of claims are enacted which must then be appealed to the Constitutional Court where they may be eventually reversed, processing is delayed because personnel is on an extended leave, persons with the poorest qualifications are assigned to processing the restitution cases, every decision ordering restitution or compensation is automatically appealed, often several times and on the most tenuous or frivolous grounds, either by the Slovenian Indemnity Fund or the local authorities holding the property, cases are thus sent to the appellate authority where action on them is postponed indefinitely.

Slovenia Attempts to Abrogate the Restitution Law.

For seven years the Slovenian government tried all it could to vitiate the Restitution Law. A moratorium applicable to certain classes of claimants was enacted which was eventually voided by the Constitutional Court. In the fall of 1998 the Slovenian Parliament enacted revisions of the Restitution [Denationalization] Act of 1991 proposed by representatives of the communist continuity.[6] Although the real intent of the revisions was to abrogate the Restitution Law, the Slovenian government and its diplomatic representatives represented the revisions to the United States and the Council of Europe as an improvement designed to speed up the completion of the restitution process. The revisions would, among other things, effectively bar American citizens from asserting their claims [7] and create other obstacles to restitution.[8] In response to our appeal, the Constitutional Court voided the provision barring American citizens from claiming restitution.

Consequences of the Revision.

As a result of the revisions, the administrative units have been inundated by counterclaims of entities that hold and use nationalized properties. The processing of the unresolved claims has ground to a halt -- precisely the effect desired by the regime. An example is the case of the house of the Avsenek family located between the German Embassy and the new American Embassy in Ljubljana. The court decided that the house, valued at $600,000, was unjustly confiscated and should be returned to the Avseneks but the City of Ljubljana, which had been using the house for a kindergarten, claims that the heirs should compensate it for the alterations it made. Eventually the Avseneks may well wind up owing money to the city instead of recovering their house. .

Property Rights as Basis of Other Human Rights.

Property rights are one of the mainstays of all other human rights. People whose property can be taken away at the will of the government can never be politically independent and cannot support political parties of their choice. The ability of a government to seize private property under any pretext provides an incentive for its officials to violate human rights of persons whose property they covet by charging them with offenses against the regime such as the exercise of the freedom of speech, religion, association, press, travel and the like.

Restitution is important because of its meaning to the individual who wants to get back his home, for which he worked all his life, or his ancestral land. Consider the example of the Zupan family in Mojstrana: the communists, considering them unreliable for living close to the border, confiscated their farm and, deported them inland to an isolated place where they did not want to live and where they died in despair. Their granddaughter has been trying to recover the family property for seven years, without success. A bureaucrat in Mojstrana said: "We wonder what would that old woman do with all this property."

Respect for Human Rights as a Cornerstone of the Foreign Policy.

The intention of the United States to speak out on behalf of international human rights standards was formalized in the early 1970s. [ 9] Congress has required that United States foreign and trade policy take into account human rights observance of foreign countries and that country reports be submitted to Congress by the Department of State on an annual basis. However, the reports do not address violations of property rights because the Department of State does not consider property rights to be of equal importance as are other human rights.[10 ]

It would be highly desirable that the Congress reaffirm its intent that it wants to be informed about the observance of the human right to own and enjoy property in the annual reports of the Department of State.

Property Restitution a Key Bilateral Concern of United States and Slovenia. Representatives of the United States Government at the highest level have on numerous occasions urged Slovenian government officials to resolve fairly and timely the outstanding restitution claims.[11] It is not realistic, however, to expect that Slovenia will settle an obligation of several billion dollars solely on the recommendation of the United States without tying it to something Slovenia wants, such as foreign aid, membership in NATO, loans, and the like.

Equal Protection of Laws.

It is the policy of the Department of State not to represent formally claims of United States citizens who were naturalized after the title of the property in question was first disturbed. We believe that this is a denial of the equal protection of laws. Our case involves a right conferred by the Slovenian law enacted in 1991 on all claimants who were citizens of Yugoslavia in 1945, regardless of their current citizenship status, some of whom are now United States citizens.[12] These United States citizens are experiencing a de facto denial of their claims because they have exhausted all locally available means of redress. We believe that the American diplomatic representatives in Slovenia should protest vigorously against the discriminatory treatment of the American citizens who have filed claims for the return of their property under the 1991 Restitution Law and that the Department of State should pursue a settlement of United States citizen claims with Slovenia.

How Can the Congress Help?

The Foreign Assistance Act of 1961, [13] provides for sanctions to be imposed on a government that violates property rights of American citizens. The law should be used to suspend assistance to Slovenia because it has, after it enacted the Restitution Law of 1991, again de facto expropriated and taken control of property of American citizens and continues to violate, deliberately and systematically, Article 17 of the Universal Declaration of Human Rights. The suspension should remain in force until such time as Slovenia fully and fairly settles all the outstanding restitution claims. A strong mandate from the Congress would be needed if words calling for respect of human rights are to be matched by deeds.

Thank you, Mr. Chairman, for the opportunity to discuss these important issues. I would be happy to answer your questions.