Tribunal Criminal Tribunal for the Former Yugoslavia

Page 1532

 1                           Monday, 17 November 2008

 2                           [Open session]

 3                           [The accused entered court]

 4                           [The witness entered court]

 5                           --- Upon commencing at 2.17 p.m.

 6             JUDGE MOLOTO:  Good afternoon to everybody in and around the

 7     courtroom.

 8             Madam Registrar, will you please call the case.

 9             THE REGISTRAR:  Good afternoon, Your Honours.  Good afternoon,

10     everyone in and around the courtroom.  This is case number IT-04-81-T,

11     the Prosecutor versus Momcilo Perisic.

12             JUDGE MOLOTO:  Thank you very much.

13             Could we have appearances, please, starting with the Prosecution.

14             MR. SAXON:  Good afternoon, Mr. President.  Good afternoon, Your

15     Honours.  Dan Saxon for the Prosecution, together with my colleagues

16     Ms. Bronagh McKenna and Ms. Carmela Javier.

17             JUDGE MOLOTO:  Thank you.

18             For the Defence, Mr. Lukic.

19             MR. LUKIC: [Interpretation] Good afternoon, Your Honours.  Good

20     afternoon to everyone in the courtroom.

21             Appearing today for Mr. Perisic are legal assistants Tina Drolec,

22     Milos Androvic, Chad Mair, and our case manager, Daniela Tasic,

23     Mr. Gregor Guy-Smith, and Novak Lukic, myself, as Defence counsel.

24             JUDGE MOLOTO:  Thank you very much.

25             Good afternoon, Mr. Torkildsen.  May I just warn you that you are

Page 1533

 1     still bound by the declaration you made at the beginning of your

 2     testimony to tell the truth, the whole truth, and nothing else but the

 3     truth.  Thank you very much.

 4             Mr. Lukic.

 5                           WITNESS:  MORTEN TORKILDSEN [Resumed]

 6                           Cross-examination by Mr. Lukic:  [Continued]

 7        Q.   [Interpretation] Good afternoon, Mr. Torkildsen.

 8             MR. LUKIC: [Interpretation] If I may ask the usher to give

 9     Mr. Torkildsen a hard copy of his report.  When I refer to certain

10     paragraphs, I will reference also the number in e-court, but I believe

11     Mr. Torkildsen will find it easier to find it by the number of the

12     paragraph.

13        Q.   Mr. Torkildsen, I should like to broach a topic in your report in

14     chapter 3, paragraph 16 onwards.  That's the financing of the Yugoslav

15     Peoples' Army in 1991 and 1992.  When I refer to a specific paragraph, I

16     will give you the number, but first of all I'd start with a few general

17     questions.

18             Would you agree if I said that the budget of the Socialist

19     Federal Republic of Yugoslavia, but generally speaking that the budget of

20     a state is a public document and that it is always shown in the form of a

21     law?

22        A.   At least I would agree with your first statement that it's a

23     public document that is always shown in the form of a law that I cannot

24     say.  But at least these budgets have been shown in the form of a law

25     when it comes to the SFRY.

Page 1534

 1        Q.   In the Socialist Federal Republic of Yugoslavia, and I emphasise

 2     that this is the period up to, let's say, 1991, although formally

 3     speaking the Federal Republic of Yugoslavia was established in 1992,

 4     would you agree with me that there was a federal budget as well as

 5     republican and provincial budgets?

 6        A.   Yes, that is correct.

 7        Q.   Do you agree that in the course of 1990, and 1991 especially, the

 8     public revenues of the citizens of Yugoslavia provided much less to the

 9     federal budget than to the republic budgets?

10        A.   Yes, that -- just trying to make your point of what actually

11     makes up these budgets.  The republican budgets, meaning on the

12     republican level, they were, to a large extent, financed by income tax on

13     the citizens, while the federal budgets, they again will be made up by

14     contributions by the socialist republics and the two autonomous regions

15     and the likes of custom taxes.

16        Q.   Do you know any other sources of revenues to the federal budget?

17     What else financed the federal budget?  In paragraph 16 you enumerate

18     these sources specifically.  You can look at that paragraph.  It lists

19     the sources of the federal budget.  Are there any sources that you did

20     not include there in the first sentence?

21        A.   I'm here pointing out in paragraph 16 that the customs and import

22     taxes, the contributions, as I mentioned, and also by loans from the

23     National Bank of Yugoslavia.

24        Q.   You don't know, do you, whether the loans from the National Bank

25     of Yugoslavia before the first half of 1991 were also financed from the

Page 1535

 1     primary issue?

 2        A.   Most likely they were, but the magnitude of this financing,

 3     meaning the loans and the primary issues, were much less.  I have, for

 4     instance, also reviewed the SFRY budget, all the annual accounts for

 5     1990, and then the proportion coming from loans or primary issues from

 6     the National Bank of Yugoslavia was much less.

 7        Q.   When I looked up that budget I noticed another source of

 8     financing for the budget which you did not include here.  Perhaps it's

 9     not important.  But do you agree that federal taxes were also a source of

10     financing for the federal budget?

11        A.   Probably.  I have to posit back.  I don't know what type of

12     federal taxes you would be referring to.

13        Q.   Literally, in the budget of the SFRY and later in the budget of

14     the FRY and even Republika Srpska, one of the original sources of

15     financing was the taxes paid by citizens for services rendered by federal

16     authorities, federal agencies.  Do you know anything about that?

17             I have to be more precise, because the word "tax" is a bit

18     different from the English word "tax," because in Serbian the word

19     "taksa" means a fee, an administrative or other fee, paid for services

20     rendered by the federal agencies.

21             JUDGE MOLOTO:  Yes, Mr. Saxon.

22             MR. SAXON:  I'm very sorry to interrupt, but I have a similar

23     concern as I expressed, I believe, last week.  Page 4, lines 6 to 8,

24     Mr. Lukic says:  "When I looked up that budget, I noticed another source

25     of financing for the budget which you did not include here.  Perhaps it's

Page 1536

 1     not important."  And then lower down, line 12:  "Literally, in the budget

 2     of the SFRY and later in the budget of the FRY and even Republika Srpska,

 3     one of the original sources of financing was the taxes paid by citizens

 4     for services rendered by federal authorities, federal agencies."

 5             My concern is simply this:  It seems to me that these are

 6     statements of fact as opposed to questions, Your Honour.  And I don't

 7     know what the source of this is or whether the witness can say the source

 8     of this, but it's simply a concern that what is coming into the record is

 9     somehow not being shown here in this courtroom.

10             JUDGE MOLOTO:  Mr. Lukic.

11             MR. LUKIC: [Interpretation] I think it is ambiguous in the record

12     what has or has not been shown to the witness.  I put it to the witness

13     because in paragraph 16 he lists item by item what he established to have

14     been the direct revenues to the budget.  I'm asking him about another

15     source of direct revenue.  If he doesn't know, he doesn't know.  I just

16     wanted to remind him.

17             JUDGE MOLOTO:  The point is, Mr. Lukic, this is an expert

18     witness.  He's not a fact witness, so you are not trying to test his

19     memory whether he knows the facts.  If you know of any other source of

20     income, show it to him; let him comment on it.  Because he has given us

21     in his report what he has considered to be sources of income, and if you

22     are aware of any other sources of income that is not there, say to him,

23     Are you aware of whether this was another source, and he will say whether

24     he was, and let's see the source.

25             I think the point being made by the Prosecution is that you're

Page 1537

 1     making a statement and either the witness believes what you say or he

 2     doesn't believe you.  But if you confront him with real evidence and say,

 3     This is another source; did you consider it, then it's a different story.

 4             MR. LUKIC: [Interpretation] I agree with you completely, Your

 5     Honours, concerning the documents that I intend to put to this witness,

 6     concerning some of my assertions.  But I am just testing here some of the

 7     claims he made in his report based on his own sources.  I don't want to

 8     show the documents to him and open some new issues.  I will in my case

 9     present new documents, whereas here I'm just testing the credibility of

10     the expert witness.

11             MR. SAXON:  Your Honour, the problem that I see is that the

12     testing, at least at this stage, is being done in the form of assertions

13     of fact, rather than questions being put to the witness.

14             JUDGE MOLOTO:  Assertions of fact, Mr. Lukic, which are not

15     substantiated and this witness, therefore, will not be in a position to

16     comment on those assertions.  But your learned friend is making a point.

17     Do you have a response to it?

18             MR. LUKIC: [Interpretation] No, Your Honour.  In any case, I will

19     formulate my questions in such a way as to get an answer from the

20     witness.  If I don't have a document in front of me, I won't ask

21     questions of that sort.

22             JUDGE MOLOTO:  Thank you very much.

23             MR. LUKIC: [Interpretation]

24        Q.   Would I be right in saying, Mr. Torkildsen, that a large deficit

25     in the federal budget in 1991 derived mainly from the fact that the

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 1     republics had stopped paying their compulsory contributions?

 2        A.   I think that that would be an important reason for the deficit,

 3     but it would also be at that time that they had actually started to print

 4     money in order to finance the deficit, because when you start printing

 5     money, things get out of hand in terms of that the inflation starts to

 6     accelerate.  And that means that the only option left, if this printing

 7     of money continues, is to continue printing money in order to finance

 8     this deficit.  So it would not only be that the contributions have

 9     stopped, but also the fact that you have started to print money in order

10     to -- in order to make up for the budget deficit.

11             JUDGE MOLOTO:  But, Mr. Torkildsen, isn't that a "cause and

12     effect" kind of situation?  Isn't the printing of money resorted to

13     because the citizens -- the provinces have stopped contributing, and

14     therefore, there is a deficit because they are not contributing?

15     Therefore, money gets printed to make up the shortfall.

16             THE WITNESS:  That is the way that I understand it, because there

17     were no other sources of finance.

18             JUDGE MOLOTO:  So would you then agree with Mr. Lukic's

19     proposition?

20             THE WITNESS:  Yes, I do.

21             JUDGE MOLOTO:  Thank you.

22             MR. LUKIC: [Interpretation]

23        Q.   That's precisely what I wanted to emphasise, what is the cause

24     and what is the effect.

25             In the next sentence of paragraph 16 you say that increasing

Page 1539

 1     disintegration of the SFRY in 1991 adversely affected the budget,

 2     especially in the area of revenues.  Were you aware that Slovenia and

 3     Croatia had stopped paying their contributions to the federal budget even

 4     before they had declared their independence?

 5        A.   That sounds natural, yes, that they stopped contributing when

 6     they proclaimed independence.

 7        Q.   No.  In fact, I asked you whether you knew they had stopped

 8     paying contributions even before - before - the declaration of

 9     independence.

10        A.   I haven't seen any facts to that, but I am -- I assume that what

11     you're saying here is correct.

12        Q.   In the same paragraph you refer to the reason for the resignation

13     of Prime Minister Ante Markovic, and you quote a newspaper article

14     regarding his resignation, and this quotation says that as much as 81 per

15     cent of the budget for 1992 was envisaged to finance the JNA.

16             As a percentage it creates the impression that we are talking

17     about a militarist state, seeing how large a proportion of the budget was

18     used for the army.  But do you know who the other beneficiaries of the

19     federal budget were?

20        A.   That I can't remember.

21        Q.   Do you recall from reviewing the documents whether you had

22     established that most of the institutions, such as police, the justice

23     system, the healthcare system, were financed at the republic level?  The

24     education system, the pension funds.

25        A.   That may be correct, but today I cannot remember which

Page 1540

 1     institutions were financed at the republican level and which institutions

 2     were financed at the federal level.

 3             JUDGE MOLOTO:  Just now coming out from that question, my

 4     question is:  This 81 per cent, was it 81 per cent of the federal budget?

 5             THE WITNESS:  Yes, that's my understanding.

 6             MR. LUKIC: [Interpretation]

 7        Q.   Would you agree with me that the government led by Mr. Ante

 8     Markovic had proposed enacting a law for financing certain requirements

 9     of the national defence in September 1991?  I believe that's mentioned in

10     the next paragraph, or perhaps a bit further down below.

11        A.   Yes, I agree with that.  That is actually discussed in, I think,

12     a couple of the other documents that is attached to my report.

13        Q.   Correct.

14             MR. LUKIC: [Interpretation] I would now like to call up 65 ter

15     6560.

16        Q.   That is the document you referred to in your report and which has

17     not been introduced by the Prosecution.  So this is September 1991.  A

18     draft law made by the Federal Executive Council, still led by

19     Ante Markovic, a draft law on revenue sources for financing certain

20     requirements of national defence in 1991.

21             MR. LUKIC: [Interpretation] I would like to move to the statement

22     of reasons.  That's page 4 in B/C/S and page 6 in English.

23        Q.   I'll read one passage.  That's the penultimate paragraph in

24     B/C/S.

25             "As of 26 August 1991, for the financing of the JNA, 27 per cent

Page 1541

 1     of the plan for 1991 has been realised from direct revenues."

 2             And now on the next page, it says just below these numbers.

 3             MR. LUKIC: [Interpretation] Can we have the next page in English

 4     and the next one in English.

 5        Q.   It says:

 6             "Due to the insufficient in-flow of revenue, problems in

 7     financing the JNA have reached a critical point, because in addition to

 8     regular expenditures, there have also been considerable extra expenses

 9     incurred by the relocation of units and institutions from the territory

10     of Slovenia and the engagement of the JNA in connection with the current

11     crisis in the country."

12             Now, this document that you see in front of you proposed by the

13     federal government, did it follow that session of the Presidency you said

14     took place in August?

15        A.   Yes.  As far as I understand it, yes.

16        Q.   And after that session of the Presidency, the federal government,

17     called the Federal Executive Council, proposes the enactment of this law

18     to cover the shortfall in the federal budget for purposes of financing

19     the army, to the benefit of the army.

20        A.   Yes.

21        Q.   This law was, in fact, enacted; correct?

22        A.   That is my understanding, yes.

23        Q.   The writer of this draft law suggests that the deficit be covered

24     from loans from the National Bank of Yugoslavia; correct?

25        A.   Yes.

Page 1542

 1        Q.   These loans stated in this draft law, were they to be from the

 2     primary issue?

 3        A.   That is my understanding.

 4        Q.   And the law is proposed by Ante Markovic; correct?

 5        A.   He was at least the prime minister for the SFRY at that time,

 6     yes.

 7        Q.   Do you know the ethnicity of Mr. Markovic, perhaps?

 8        A.   Yes.  He was from -- he is from Croatia.

 9        Q.   Do you know by any chance if he remained in Belgrade after his

10     resignation?

11        A.   From what I've understood, he left Belgrade after his

12     resignation.

13             MR. LUKIC: [Interpretation] Let's now take a look at another

14     document.  It is --

15             JUDGE MOLOTO:  Before we get another document, Mr. Lukic, what do

16     you want to do with this one?

17             MR. LUKIC: [Interpretation] Yes, Your Honour, I apologise.  I'd

18     like to tender this document in evidence.

19             JUDGE MOLOTO:  You --

20             MR. LUKIC: [Interpretation] If possible, Your Honour, I'd like to

21     propose that the document be tendered, both the proposal and the

22     supplement to the document, both.

23             JUDGE MOLOTO:  We've not heard anything about the supplement of

24     the document.  I do have a question for you, though --

25             THE INTERPRETER:  The statement of reasons.

Page 1543

 1             JUDGE MOLOTO:  You asked the witness whether this draft was

 2     passed into law.  Do we have the law as passed, not in draft form?  I

 3     think that would be a better exhibit to tender rather than this one, if

 4     indeed it was passed into law.

 5             MR. LUKIC: [Interpretation] Yes, I agree, Your Honour.  I don't

 6     have the law with me, but I read that the law was passed in the report.

 7     But I'd like this draft to be admitted because there it includes the

 8     statement of reasons, explaining the motives for which the government is

 9     proposing the law, and I think that's the important point, to understand

10     the motives for the law to be imposed, and that is found in the statement

11     of reasons proposed by the government.  But I'm sure I could find the law

12     and then tender that, too.

13             JUDGE MOLOTO:  Thank you very much.  65 ter 6560 is admitted into

14     evidence.  May it please be given an exhibit number.

15             THE REGISTRAR:  That will be Exhibit D10, Your Honours.

16             JUDGE MOLOTO:  Thank you so much.

17             Yes, Mr. Lukic.

18             MR. LUKIC: [Interpretation]

19        Q.   I'd now like to move on to another area and some other documents.

20     You analysed a document which -- just let me take a moment to find it.

21     Let me put it this way:  Which means of payment in the Republic of Srpska

22     Krajina existed when it was founded?  Were there any changes, any

23     currency changes, that were used in the Serbian Republic of Krajina?

24        A.   From the documents that I have reviewed, this appears that both

25     the RS and the RSK had their own currency in 1992 and 1993, but I would

Page 1544

 1     like to elaborate on that, because their own currency was set at an

 2     exchange rate with the FRY dinar at parity, meaning that it could be

 3     exchanged on a 1:1 scale.  It was fully convertible, meaning that an RSK

 4     dinar could be exchanged for one FRY dinar.

 5             JUDGE MOLOTO:  That currency was also called a dinar?

 6             THE WITNESS:  Yes.

 7             JUDGE MOLOTO:  And in the RS, what was it called?

 8             THE WITNESS:  An RS dinar.

 9             JUDGE MOLOTO:  Also.

10             THE WITNESS:  That's my understanding.

11             JUDGE MOLOTO:  Thank you.

12             MR. LUKIC: [Interpretation]

13        Q.   What about the dinar from Republika Srpska and the Serbian

14     Republic of Krajina?  Was it a method of payment, legal tender,

15     throughout Yugoslavia?  Could it be used to pay for products?

16        A.   I assume so, but that would -- I mean, either -- if you could pay

17     in the RS dinar or you actually had to exchange it for a Yugoslav or an

18     FRY dinar first, that I'm not sure about.  But the consequences or the

19     result would have been the same in any way.

20        Q.   When did they move on to the Yugoslav dinar in the Republika

21     Srpska and the Republic of Serbian Krajina?

22        A.   After they introduced the super-dinar that we discussed on

23     Thursday.  That would have been from early 1994.

24        Q.   You say "super-dinar," and I know what you mean by that.  But

25     just to avoid any misunderstanding, that is to say after Mr. Avramovic's

Page 1545

 1     programme was passed, that's when the super-dinar came into being; right?

 2        A.   That's my understanding, yes.

 3        Q.   Would you agree with me that the monetary system in the Republika

 4     Srpska and the Republic of Srpska Krajina, in the legal sense, that they

 5     were systems that were regulated as separate autonomous monetary systems,

 6     and they had all the necessary legal provisions covered that would cover

 7     the monetary system of any state?  Would that be right?

 8        A.   Then we would have to go to the Miletic report that was being

 9     referred to on Thursday in order to see the details on that.  I can't

10     state that what you are putting to me here is absolutely correct, without

11     looking back at that report to see what is actually stated in there.

12        Q.   Yes.  We'll deal with Miletic's report separately and then you

13     can comment on that as well.  We'll do that in due course.  But can we

14     agree that the monetary systems, as they were regulated by the provisions

15     in Republika Srpska and Republika Srpska Krajina and in the FRY, on the

16     basis of the regulations and everything, were formed and formulated, in

17     fact, in similar fashion, that they were similar?

18        A.   That is my understanding, that the whole of the RSK and the RS

19     and the FRY had a similar organisation and it was all tied together.

20        Q.   Just to avoid misunderstanding with my previous question, I

21     wanted to ask you if you knew that RS and RSK enacted their own laws

22     governing the national bank, currency generally, the payments, and so on.

23     In that sense that's how I saw legal regulations, in that sense.

24        A.   Well, I can see your point.  But also again the documents that I

25     have reviewed also show the total subordination that the national banks

Page 1546

 1     of the RS and RSK had for the National Bank of Yugoslavia in Belgrade.

 2        Q.   Yes, that's one of your thesis and we'll deal with that

 3     separately.  That's one of the things you put forward.  We'll discuss it.

 4             Now, I am saying that there was a relationship of cooperation

 5     during 1992 and 1993 and that after the provisions, or, rather, programme

 6     for the reconstruction of the monetary system of the FRY, there was

 7     monetary control by the National Bank of Yugoslavia for specific reasons

 8     towards the banks of the RS and RSK, but that it was not a relationship

 9     of subordination.  That's what I'm putting to you.

10        A.   I would totally disagree with that.  And I would like to refer

11     back to the -- back to the loan that we discussed on Thursday and refer

12     to actually what was stated in there, where it's actually stated that it

13     is the National Bank of Yugoslavia that should determine the use of that

14     loan, if I remember correctly.

15        Q.   Yes, we'll discuss the document, certainly.  But you say you

16     don't agree with me; right?

17        A.   No, I don't agree with you, at least not to the full extent of

18     that.  They were sort of moving from 1992 and onwards to 1994 in terms of

19     trying to achieve a total integration, and of course they were having

20     their cooperation and so on, but they were moving in the direction of the

21     NBY in Belgrade being in control.

22        Q.   Do you agree with me that the monetary union is not the same

23     thing as the economic union, that they are two different categories?

24        A.   That -- that could be correct, yes.

25        Q.   Economic systems between the Federal Republic of Yugoslavia and

Page 1547

 1     the RS and RSK were similar but were not the same; right?  Do you agree

 2     with me there?

 3        A.   Yeah, they were -- the economic systems were not -- were not the

 4     same basically because the RS, in particular, was from the beginning of

 5     the part of the poorest region of the SFRY.

 6        Q.   There wasn't a uniform custom system, right, between these three,

 7     let me call them, states, but you know what I'm referring to, the three

 8     entities, anyway.

 9        A.   As far as I know, there were no uniform customs system because at

10     least officially the RS and the RSK was not part of the FRY.

11        Q.   They had their revenue from taxes, right, direct revenue from

12     taxes?

13        A.   Yes.  We saw that in the budget that we went through on Thursday

14     regarding the 1993 finances, where we saw that the primary issues more or

15     less financed the whole budget.  But, of course, I assume that there

16     would be a very small proportion of that coming from direct revenue, like

17     taxes.

18        Q.   I think there might have been a mistake in the interpretation

19     here.  Just give me a brief answer.  My question was this:  Whether there

20     were direct -- whether there was direct revenue from taxes, from customs

21     levies?

22             THE INTERPRETER:  Interpreter's correction:  From customs levies.

23             JUDGE MOLOTO:  Just before the witness answers, who are you

24     talking about?  Because your first question at line 9, you said:  "They

25     had their revenue from taxes, right, direct revenue from taxes?"  And who

Page 1548

 1     are the "they," if you can just tell us who are the "they"?

 2             MR. LUKIC: [Interpretation] I was thinking of the budgets of the

 3     Republika Srpska and the RSK, whether from their own customs they had

 4     direct revenue in the budget.

 5             JUDGE MOLOTO:  Thank you, Mr. Lukic.

 6             Yes, Mr. Torkildsen.

 7             THE WITNESS:  Yes, I think that would be correct.  A very small

 8     proportion would also come from various taxes, yes.

 9             MR. LUKIC: [Interpretation]

10        Q.   There was no uniform price policy either between the FRY and the

11     RS and RSK; right?

12        A.   Well, you have to be more specific there, Mr. Lukic.  I'm sorry.

13     When it comes to uniform price policy, regarding what?

14        Q.   For example, let's look at the prices determined by the state,

15     for example, for cigarettes, fuel, and so on.  Excise taxes, in fact.

16        A.   I don't know whether it was a uniform pricing system or not.

17        Q.   There wasn't a uniform system of taxation either, was there?

18        A.   I don't know.

19             MR. LUKIC: [Interpretation] Can we now have on the screens P311,

20     please, the next document.  And the page I'd like to look at is -- just

21     let me take a moment to check with the registrar, but I think that only

22     page 12 has been admitted into evidence, or, rather, pages 12 and 13 of

23     this decision but not the entire Official Gazette, just the decision.

24     Yes, that's right.  Now can we have it in the B/C/S as well?  Page 12 and

25     13.

Page 1549

 1        Q.   This is a decision by the Government of Republika Srpska on the

 2     use of funds from primary issue, which was passed on the 2nd of June,

 3     1992, or, rather, it was passed on the 14th of May, to be precise, and

 4     published in the Official Gazette of Republika Srpska on the 2nd of June,

 5     1992.  That's right, isn't it?

 6             Now, this decision speaks about the methodology of how the

 7     primary issue funds would be used, those funds that would be applied

 8     pursuant to this decision of the National Bank of Yugoslavia, the funds

 9     that would be released by that decision.

10        A.   Yes.

11        Q.   In your analysis and in the research you did, did you come across

12     any document of the commercial banks or some state organ, for that

13     matter, which could confirm that this decision was acted upon?

14        A.   That I can't remember.

15        Q.   From this decision can we see who the benefits of the primary

16     issue sources was, the beneficiary of the primary issue sources was?

17        A.   As is listed here in Article 1, it's the National Bank of

18     Yugoslavia that -- that should determine the use of this money, according

19     to their decision.

20        Q.   Perhaps you misunderstood.  Can we see from this decision who is

21     going to use the funds given by the National Bank of Yugoslavia --

22        A.   No.

23        Q.   -- who's going to benefit from them?  Very well.

24             MR. LUKIC: [Interpretation] Now may we have document P314, an MFI

25     document, put up, please.  It is a document that I asked you to decide

Page 1550

 1     upon its admission after I conduct my cross-examination, Your Honour.

 2             JUDGE MOLOTO:  Thank you very much.  We'll do that.

 3             Just for my own edification, this Article 1 refers to a common

 4     monetary policy and common elements.  Do you know, Mr. Torkildsen, what

 5     was the common monetary policy?

 6             THE WITNESS:  Your Honour, then I would have to refer back to the

 7     Miletic report again where this is outlined.  I'm sorry, but I can't

 8     state the details regarding that now.

 9             JUDGE MOLOTO:  Thank you very much.

10             May we have P314 on the screen, please.

11             MR. LUKIC: [Interpretation]

12        Q.   It's like this:  This is a decision, Mr. Torkildsen, or, rather,

13     I assume that you found this decision in the Prosecution database that

14     you were provided, just like the other documents that you refer to.

15        A.   That is correct, yes.

16        Q.   You agree with me, I believe -- or, rather, first, can you tell

17     me when this decision was passed?  Can you see this on the basis of this

18     document?

19        A.   I can see there is a date up in the right-hand corner, mentioning

20     the 8th of July, 1992.

21        Q.   Look at the B/C/S version and you'll see that the date is written

22     in hand there, so it's not a question of you not knowing the language.

23     But anyway, the date that is mentioned in the English version is a hand

24     edition on the B/C/S document, right, written in hand?

25        A.   Yes, I can see this handwriting there.  Yes.

Page 1551

 1        Q.   And in the introduction to the decision, in the preamble, there's

 2     a space for the date.  There's a dash there and there's no date written

 3     in in the space; right?

 4        A.   That is correct.  It is mentioned here "4/92" in the first

 5     sentence.

 6             MR. LUKIC: [Interpretation] May we now go on to page 2.  Can we

 7     see page 2 in both versions, the B/C/S and English.

 8        Q.   And you can see on the original, the B/C/S original, and indeed

 9     on the English version, this document has not been signed and there's no

10     government stamp, or any other stamp for that matter; right?

11        A.   I see no stamp.  That is correct, yes.

12        Q.   In the left-hand corner -- on the left-hand side, there's an

13     empty space for the number; right?  We call it the reference number, and

14     all official documents are recorded and then the reference number is

15     written into the document.  And you agree here that there's no number

16     here, right, in either version?

17        A.   Yes.

18        Q.   Now, paragraph 5 of this decision says:  "The Republic ..." I

19     assume it means Republika Srpska "... and the National Bank shall sign a

20     contract within 30 days from the day this decision comes into force."

21             During your research, did you come across any contract which

22     would be linked to this decision?

23        A.   Not specifically a contract.  No, I can't remember that.

24        Q.   Furthermore, Article 6 or paragraph 6 reads as follows:

25             "This decision comes into force on this day and shall be

Page 1552

 1     published in the Official Gazette of the Serbian People of Bosnia and

 2     Herzegovina."

 3             And we saw that the previous government decision that we

 4     discussed was, indeed, published in the Official Gazette.  Now, during

 5     your investigations did you come across this decision having been

 6     published in the Official Gazette of RS anywhere?

 7        A.   I can't remember having seen a decision regarding this, no.

 8             MR. LUKIC: [Interpretation] Let's just go back for a moment to

 9     the first page and see that handwritten edition.  May we have the B/C/S

10     version and the English of the first page?  Thank you.

11        Q.   I'm going to read out what it says there, what the inscription in

12     writing:  "Minister Subotic," and then that's underlined, and underneath

13     that line it says:  "Coordinate these with the needs of the army," and we

14     have a signature and probably the date.  "Coordinate installments with

15     the army."

16             Now, my question is this:  From these contents and from that note

17     there, remark there, can you make any conclusions as to whether the

18     decision was passed, or is this just a proposal and remained a proposal?

19        A.   I'm not sure that I get your question, sir.  I'm sorry, if you

20     can repeat that, please.  I can't -- well, I'm reading the text now, and

21     I can't see whether the -- whether the decision was passed or not.

22        Q.   Yes, that was my question.  So from this decision, you cannot

23     establish and ascertain whether the decision was passed and put into

24     force or not; right?

25        A.   That is correct, yes.

Page 1553

 1             MR. LUKIC: [Interpretation] Your Honours, I would still like to

 2     ask you not to admit this document into evidence.  At this point in time

 3     I'm challenging both relevancy and authenticity.  Now, I can provide the

 4     documents later on.  Perhaps Mr. Saxon would like to put some questions

 5     in the re-direct with respect to his -- with respect to this document,

 6     but I think it is just a proposal and not a decision.  And the expert

 7     witness during his work used this document and said that it was a

 8     government decision, but he has now confirmed that he believes that this

 9     is a government proposal and not a final decision that was taken.

10             JUDGE MOLOTO:  You're saying you'd still like to ask that it not

11     be admitted into evidence.  Is it not already P314, or are you saying

12     it's going to be expunged from the evidence?

13             MR. LUKIC: [Interpretation] Yes.  If you recall --

14                           [Trial Chamber and registrar confer]

15             JUDGE MOLOTO:  I've now been told.  An MFI.

16             Yes, Mr. Saxon.

17             MR. SAXON:  Your Honour, this document was seized by the Office

18     of the Prosecutor from the archives of the Ministry of Defence of the

19     Republika Srpska in Banja Luka on the 6th of December, 2001.  Your

20     Honour, obviously governments keep documents in their archives because

21     these documents record the official business of the government.  Whether

22     this was merely a proposal or whether it was a decision that was

23     eventually passed, the point is this was a business record kept by this

24     institution of the Government of Republika Srpska, and so the fact that

25     the government -- the document was kept in the government archives should

Page 1554

 1     be sufficient indicia of reliability, at least for purposes of admission,

 2     Your Honour.

 3             MR. LUKIC: [Interpretation] Your Honour, I still challenge the

 4     relevance of this document because in his work this expert witness

 5     analysed the document as being a government decision.  But from this

 6     document we can't actually see, and I'm claiming that this is, in fact, a

 7     draft decision and we cannot know whether there was a decision passed.

 8     So I don't see what -- how this document can be of assistance to the

 9     Trial Chamber if we don't know whether it was put into effect in any way.

10             And that is why I suggest that either you do not adopt and admit

11     this document because it's not relevant, or if the Prosecution finds that

12     there was a final decision on the basis of this draft, then I won't have

13     anything against it being admitted into evidence ultimately.

14             MR. SAXON:  Your Honour, an item is relevant if it speaks to an

15     issue that is pertinent in these proceedings, and this document does just

16     that, Your Honour.  It speaks to the issue of how the Government of

17     Republika Srpska was financed in 1992.  Whether it was simply a proposal

18     or whether it became a final decision, it doesn't change the fact that it

19     is relevant.

20             Quite frankly, Your Honour, on Thursday Your Honour admitted, I

21     believe, other proposals - I can't name the exhibit number - but

22     certainly Your Honour admitted requests, although there is no evidence

23     right now that those were -- those requests were fulfilled.  And I submit

24     we are in the same position with this document, Your Honour.

25             JUDGE MOLOTO:  The document will remain marked for identification

Page 1555

 1     until -- whether or not you can give us an original -- a final decision.

 2             MR. LUKIC: [Interpretation] Now I'd like to ask a few questions

 3     on the Miletic report.  I believe that's P310.  No, it's P315, because

 4     there have been certain changes.

 5        Q.   In your report you analyse it in paragraph 45.

 6             MR. LUKIC: [Interpretation] And I don't know if the Trial Chamber

 7     has Mr. Torkildsen's report in front of them.  If not, we should maybe

 8     first call up this passage in his report, paragraph 45.  It's page 16 in

 9     English and 15 in B/C/S.

10        Q.   We're talking about the next stage, and I quote here, from your

11     analysis of the Miletic report.  In paragraph 45 you say:

12             "The programme created a single monetary region to include the

13     FRY, the RS, and the RSK.  This programme came into effect on the 1st of

14     March, 1994."

15             My first question is:  Where did you find this date?

16        A.   The date mentioned here must have come from the report itself.

17        Q.   I have read the whole report, and I haven't found that date

18     anywhere.

19             MR. LUKIC: [Interpretation] Perhaps it would be a good idea to

20     give the witness a hard copy of his -- sorry, the Miletic report, during

21     the break so that we don't have to go through it page by page now.

22        Q.   But is this date significant in any way?

23        A.   The date is significant in the way that that's from approximately

24     the point in time where the super-dinar was introduced and when they used

25     the same currency across the three entities in question.

Page 1556

 1        Q.   I maintain that the programme of the restructuring of the

 2     monetary system and the economic recovery of Yugoslavia was adopted on

 3     the 24th of January, 1994, and it entered into force on that day and it

 4     was on that day that the super-dinar started to apply.  Does that date

 5     mean anything to you?

 6        A.   Well, I can't remember the exact date now, but I'm sure that what

 7     you're putting to me in terms of the super-dinar being introduced on the

 8     24th of January, 1994, that that is correct.  That sounds right, from

 9     what I remember.

10        Q.   Now, the way you analysed the Miletic report, I understood and

11     you will correct me if I'm wrong, so that the third stage of this

12     monetary union between the FRY, the Republika Srpska, and Republika

13     Srpska Krajina, you call it "The Programme of Reconstruction of the

14     Monetary System and the Strategy for the Economic Recovery of

15     Yugoslavia."  Is that so?  Did I understand your reasoning correctly?

16        A.   Yes, that is correct.

17        Q.   Because, quite frankly, I understand it quite differently, this

18     Miletic report.  But we'll see.  Maybe I'm wrong.

19             MR. LUKIC: [Interpretation] Can we now call up the Miletic

20     report.  In B/C/S, page 2.  That's P315.  We need page 2 in B/C/S and

21     page 3 in English.

22        Q.   Item 3, Miletic writes:

23             "The period of commencement of the implementation of the

24     reconstruction of the monetary system and the strategy for the economic

25     recovery of Yugoslavia, hereinafter 'programme,' in the part relating to

Page 1557

 1     Republika Srpska and the Serbian Republic of Krajina ..."

 2             Now, I asked you this last Friday, and I can't remember your

 3     answer.  The programme of Governor Avramovic that came into effect on the

 4     24th of January, 1994, was called "The Programme of Economic Recovery of

 5     Yugoslavia" and not "The Programme of Monetary Union."  That's what I

 6     maintain.  To be more precise, in this part 3, Miletic describes how this

 7     programme adopted by the Federal Republic of Yugoslavia and for the FRY

 8     was implemented in the RS and the RSK.

 9        A.   Sorry, I didn't get your question.

10        Q.   I maintain, I put it to you that Miletic quotes in his report

11     under number 3, and it's called "The Programme of Reconstruction of

12     Monetary System and the Strategy for Economic Recovery of Yugoslavia" was

13     a programme adopted for the FRY, not for the Republic of Serbian Krajina

14     or Republika Srpska.  It's just that they implemented certain parts of it

15     that were relevant to them.  It's not about a monetary union of the three

16     entities.

17        A.   That I totally disagree on.

18        Q.   Have you read, let me repeat this, "The Programme of

19     Reconstruction of Monetary System and the Strategy for Economic

20     Recovery"?  It's a thousand-page public document.

21        A.   No, I have not read that.

22        Q.   Thank you.  And do you know the name of the Avramovic programme,

23     designated, to effect, an economic recovery of the country and the whole

24     system, or do you believe it is a programme destined for all the three

25     entities?

Page 1558

 1        A.   I can't comment on that 1.000-page programme because I haven't

 2     read it.

 3        Q.   Just a moment.  Would you agree with me that the gist of the

 4     programme for the economic recovery of Yugoslavia, that is, the

 5     reconstruction of the monetary system and the strategy for economic

 6     recovery, was to stop financing the state by printing money, and thus to

 7     stop inflation?

 8        A.   Yes, that is my understanding, without having read the 1.000-page

 9     programme.

10        Q.   And one of the means to reach that end was the introduction of

11     the new dinar, the super-dinar.

12        A.   Yes.

13        Q.   I suppose you are very familiar with the Miletic report.  And my

14     thesis is that the whole point of this Miletic report was to establish

15     whether the National Bank of Republika Srpska was able to successfully

16     join the Avramovic programme that it would implement in one of its

17     segments.

18        A.   Yes.

19        Q.   And that applied exclusively to the monetary system, didn't it?

20        A.   Yes.  The Miletic report is discussing the monetary system, yes.

21        Q.   And nowhere in the Miletic report do we find the word

22     "subordination"; only the word "cooperation" is used.

23        A.   Again, that means I would have to look through the Miletic

24     report.  It's one thing that you are using the word "subordination" as

25     such.  The other thing, if there are certain facts described in the

Page 1559

 1     report that is actually speaking about subordination without using the

 2     term, again, I would have to look at the report in detail in order to

 3     answer that.

 4             MR. LUKIC: [Interpretation] I have no objection to the witness

 5     reviewing the Miletic report during the break, if the Trial Chamber

 6     agrees, so that he can answer this question.  Before the break, just a

 7     few brief questions.

 8        Q.   In a monetary union, is it the case that the one who prints money

 9     and makes it available to another, is it normal for the former to have

10     control over the flow of monies so that the interests and the existence

11     of the money printer are not jeopardised?

12        A.   Yes.

13        Q.   I will ask you even more simply:  Legally, in contractual

14     relations, is it important for the lender to ensure that the borrower is

15     credit-worthy, solvent, so that the loan be eventually repaid?

16        A.   In normal circumstances that would be the case, yes.

17        Q.   By introducing the new dinar, hyperinflation was completely

18     stopped; isn't that the case?

19        A.   Yes, that is my understanding.  Yes.

20        Q.   And if this new super-dinar had been used without any control,

21     that would have been running the risk of a new round of hyperinflation in

22     the Federal Republic of Yugoslavia; correct?

23        A.   Yes.

24             MR. LUKIC: [Interpretation] Perhaps it's a good time for a break,

25     Your Honour.

Page 1560

 1             JUDGE MOLOTO:  Thank you very much, Mr. Lukic.

 2             We'll take a break and come back at 4.00.  Court adjourned.

 3                           --- Recess taken at 3.30 p.m.

 4                           --- On resuming at 4.00 p.m.

 5             JUDGE MOLOTO:  Yes, Mr. Lukic.

 6             MR. LUKIC: [Interpretation]

 7        Q.   Mr. Torkildsen, let us now go back to the two questions I asked

 8     earlier regarding the Miletic report.

 9             One, did you see in the Miletic report the word "subordination"

10     or any reference to a relationship of subordination between the National

11     Bank of Yugoslavia on the one hand and the National Banks of Republika

12     Srpska and Republika Srpska Krajina?  Did you find any references that

13     would indicate such a relationship?

14        A.   Well, to answer the first part of your question, I did not see

15     the word "subordination" being used in the translation at all, but I did

16     find references within this Miletic report that actually describes the

17     relationship of subordination, and I would like to point out page 3,

18     paragraph 4, in the English translation.

19             JUDGE MOLOTO:  Is it possible to have it on the screen, or is it

20     part of your report, Mr. Torkildsen?

21             THE WITNESS:  What I can do is to read out the relevant

22     paragraph, if it is okay.

23             JUDGE MOLOTO:  Fine.  Go ahead.

24             THE WITNESS:  It is stated here that:  "The competent

25     institutions of Republika Srpska and the Republic of Serbian Krajina

Page 1561

 1     would bring all other regulations on which the implementation of the

 2     agreed single monetary and credit policy depended on into line with

 3     regulations adopted by the Federal Republic of Yugoslavia."

 4             And then I would like to point out at -- also, paragraph 5, on

 5     the same page.

 6             JUDGE MOLOTO:  Would you like to read that for us?

 7             THE WITNESS:  Yes.  "Monetary policy projections for certain

 8     periods and their provision were carried out in accordance with the

 9     relevant elements in the programme and were brought into line with the

10     relevant portions of the quantitative tasks of the monetary policy

11     carried out by the National Bank of Yugoslavia.

12             "In this context, it is especially worth mentioning that the

13     quantity frameworks for the amounts of dinars that the National Bank of

14     Republika Srpska issued to the banks from the area of Republika Srpska

15     were also brought into line by relevant decisions of the National Bank of

16     Republika Srpska."

17             THE INTERPRETER:  Would you kindly slow down for the

18     interpreters.  Thank you very much.

19             THE WITNESS:  Sorry.  "They are established in accordance with

20     the valid set of instruments and valid decisions of the National Bank of

21     Yugoslavia."

22             Sorry, I made a note of this during the break and now I was

23     referring to page -- page 4, I think, but I actually meant to start

24     referring on page 3.  I just need to find -- back to that.  Sorry about

25     this, Your Honours.

Page 1562

 1             JUDGE MOLOTO:  Take your time.

 2             THE WITNESS:  Okay.  The fourth paragraph on page 3, this is

 3     actually what I made a note of now during the break and not what I just

 4     referred to.

 5             "The National Bank of Republika Srpska and the National Bank of

 6     the Republic of Serbian Krajina would bring all monetary and credit

 7     regulation instruments in line with relevant monetary and credit

 8     regulation decisions of the National Bank of Yugoslavia."

 9             And then I would, in particular, like to highlight the paragraph

10     on the bottom here.

11             "All necessary changes resulting from the achieved monetary and

12     credit movements would be agreed upon through standard expert cooperation

13     and through decisions taken at a meeting of national bank governors,

14     which would then be verified at sessions of national bank boards."

15             And then the question then arises, and I would like to refer back

16     to the document that we pointed out last Thursday regarding the voting

17     rights concerning these meetings, and where it was in particular pointed

18     out that the voting rights not being there for the National Bank of the

19     RS and the RSK.

20             And I would also like then to go further on to page 4, the first

21     paragraph, where it is stated.

22              "The corner currency reserving of the National Bank of Republika

23     Srpska and the National Bank of the Republic of Serbian Krajina would be

24     a constituent part of the foreign currency reserves of the National Bank

25     of Yugoslavia, to be kept on the books as special accounts abroad and

Page 1563

 1     subsidiary accounts of the National Bank of Yugoslavia.  The National

 2     Bank of Yugoslavia would issue orders for the use of foreign currency

 3     reserves from the National Bank of Republika Srpska and the National Bank

 4     of the Republic of Serbian Krajina through the relevant national bank."

 5             It is basically stated here that it is the National Bank of

 6     Yugoslavia who's going to determine how the foreign currency reserves of

 7     the National Bank of Republika Srpska and Republika Srpska Krajina should

 8     be used, and in my view that is -- that is a good example of

 9     subordination in this respect.

10             MR. LUKIC: [Interpretation]

11        Q.   I want to follow up on the last thing you said.  The foreign

12     exchange reserves of the National Bank of Republika Srpska, did they

13     serve as collateral for obtaining dinars from the National Bank of

14     Yugoslavia?

15        A.   That is my understanding from -- from -- from the period after

16     approximately February 1994.

17        Q.   Was the National Bank of Yugoslavia able to dispose of this

18     foreign exchange monies it had deposited with it without the consent of

19     the National Bank of Republika Srpska?

20        A.   That's the way that I read this, that it was up to the NBY in

21     Belgrade to determine the use of this foreign currency, yes.

22        Q.   That's your interpretation from what you're reading.

23        A.   Yes.

24        Q.   Just one more clarification on what you've said a moment ago when

25     you said that the representatives of the National Banks of Republika

Page 1564

 1     Srpska and the RSK attended the sessions of the Board of Governors of the

 2     National Bank of Yugoslavia without having voting rights.  You were

 3     referring to another document, not the Miletic report; correct?

 4        A.   That is correct, yes.

 5        Q.   In the Miletic report, quite the opposite is written.  It

 6     describes how decisions were made in the National Banks of Republika

 7     Srpska and the RSK.  There is no mention of any interference in the

 8     decision-making of the Board of Governors of the National Bank of

 9     Yugoslavia in monetary issues.  That's the passage that refers to expert

10     assistance.

11        A.   It is not specifically mentioned, anything about the voting

12     rights in the Miletic report.  That is correct.

13             MR. LUKIC: [Interpretation] Can we have page 3 in English.  We

14     need to look at the last paragraph.

15        Q.   The last paragraph stipulates the method of decision-making

16     concerning monetary policy; correct.

17        A.   Yes.  It's mentioned here, "standard expert cooperation" and

18     "through decisions taken at the meeting of national bank governors."

19        Q.   And it says in English:

20             [In English] "... credit movements would be agreed upon through

21     standard expert cooperation."

22        A.   Yes, that is correct.

23        Q.   [Interpretation] Right.  Let me remind you of another question I

24     put to you earlier concerning the date, the 1st of March, 1994, mentioned

25     in your report.  Did you see it anywhere in the Miletic report, or

Page 1565

 1     alternatively, did you remember why you wrote it in your report?

 2        A.   First of all, I checked the document, and I could not find a

 3     specific date, as you pointed out, within the report.  I would just like

 4     to add to that, and that is that this Miletic report, when I reviewed

 5     this, was part of a bundle of other financial documents, a total of six

 6     documents, and I have at least not invented those dates myself.  So that

 7     means that those dates must come from one of the five other documents

 8     that was contained within that bundle of documents.

 9             MR. LUKIC: [Interpretation] I'd like to move to page 8 in B/C/S

10     of the same document and page 9 in English.

11        Q.   In B/C/S, towards the middle of the page, it says:

12             "Finally, as a very important segment in the implementation of

13     the programme, there remains the question of regulating real direct

14     revenues of the budget of Republika Srpska.  In this area the National

15     Bank of Republika Srpska is in constant contact with the competent

16     authorities of Republika Srpska with which this issue needs to be

17     regulated in line with the intentions of the programme."

18             Do you agree that this paragraph, and, indeed, the whole report,

19     does not mention anywhere that the collection of direct revenues by

20     Republika Srpska would be in any way connected with the FRY?

21        A.   That is my understanding as well, yes.

22        Q.   Thank you.

23             MR. LUKIC: [Interpretation] Let's now move to another document.

24     It's an MFI, and again it was decided that the Trial Chamber will decide

25     on admission after my examination.  P323, MFI.

Page 1566

 1        Q.   This is an Official Note dated 12 May 1994, and you refer to it

 2     several times in your report and you mentioned it again when you spoke

 3     about the relationship of subordination.  You agree, correct, that's the

 4     document on the basis of which you claim there was a relationship of

 5     subordination between the National Bank of the FRY and the National Banks

 6     of Republika Srpska and the Republic of Serbian Krajina; correct?

 7        A.   That is correct, if this is the document mentioning the issue of

 8     no voting rights and also other -- other issues.

 9        Q.   You found this document in the Prosecution's collection of

10     documents when you were doing your report; correct?

11        A.   Yes.

12             MR. LUKIC: [Interpretation] Page 2, please, or, rather, page 3,

13     the last page of the document.  It's a three-page document.  In fact, the

14     English version has five pages and the B/C/S has three.

15        Q.   Can we see who the author of this document is?  I don't know if

16     you heard the question.

17        A.   Sorry, no.

18        Q.   I asked you, can we see from this document who authored it?  Can

19     you conclude who the author is?

20        A.   No, I can't read the signature on the last page, if that is a

21     signature at all, unless it is stated in the beginning of the document,

22     the author.

23             MR. LUKIC: [Interpretation] We can go back to page 1.

24        Q.   Now, in view of the contents of this document, would it be

25     standard procedure for this document to be signed, have a stamp and

Page 1567

 1     reference number, if it's an Official Note made at a kind of important

 2     meeting, that seems to be the case from the introduction?

 3        A.   Whether that would be standard procedure, I wouldn't know.  But

 4     since it's an Official Note, it wouldn't be unlikely at least.

 5        Q.   Now, we are still discussing this document because I have new

 6     problems with it.

 7             MR. LUKIC: [Interpretation] Can we call up 65 ter 6526.  That's

 8     P315.  In English we need page 13, and in B/C/S, page 11.

 9        Q.   This is the document which, as you said earlier, you reviewed

10     together with the Miletic report, that there were many of them, and they

11     have the same 65 ter number.  I maintained that this document is

12     absolutely identical to the previous one in terms of substance.  I don't

13     know how best to deal with this, if we can return to the English version

14     of the previous document for you to compare.  There are only certain

15     differences in the format.

16             MR. LUKIC: [Interpretation] Can we put the English version of the

17     previous document alongside?

18        Q.   Here, have a look at these two documents, or perhaps you've done

19     it before during your own research.  The language is absolutely the same.

20     Perhaps there are certain differences in the English translation, but do

21     you think it's the same substance?

22        A.   Well, I assumed at the time that I reviewed these documents that

23     it was the same document, yes.

24             MR. LUKIC: [Interpretation] Now, I'm sorry about complicating the

25     work of the registrar.  I'd like the B/C/S version of the previous

Page 1568

 1     document and the B/C/S version of the current one, the last page.  Leave

 2     the first page for now.

 3        Q.   I will read what it says in B/C/S because it's a problem for me.

 4     This Official Note, which is of the same substance as the previous one,

 5     is written in a different dialect.  Unfortunately, that's not -- this is

 6     the one.  Right.  In the document on the left, and the interpreters can

 7     confirm this, it says "Official Note" with the word "beleska" used, and

 8     the document on the right is called "Official Note" with the word

 9     "zabiljeska" used and it's written in the Ijekavian dialect.  Maybe you

10     weren't able to establish this, but perhaps you had a language assistant

11     helping with you.  This dialect is not written in Serbia.  If you don't

12     know, just say so, we can move on.

13        A.   I don't know.  And in general terms, I can't testify to the

14     authentication of these documents.

15             MR. LUKIC: [Interpretation] Let's look at just the last pages of

16     both documents.  That's page 3.  We've seen this one.  And now I'd like

17     to see the last page of the zabiljeska document, in B/C/S.  The other

18     document.  P315, the last page.  Thank you.  That's it.  Thank you very

19     much.

20        Q.   You can see there is a difference in the ending.  On the

21     right-hand side, I will read it in Serbian, it says, "The Governor of the

22     National Bank of Yugoslavia ..." and it's not signed.

23             My question is:  When you were reviewing the Official Note of

24     Mr. Miletic, you said that attached to it you saw a whole group of other

25     documents; correct?

Page 1569

 1        A.   That's correct.  Actually, it was, if I remember correctly, five

 2     other documents, but they were not attached to the Miletic report as

 3     such.  But it was filed with the Prosecution's evidence system as a

 4     complete batch of documents, but I always viewed these documents as being

 5     separate.

 6        Q.   That was precisely my problem when I had certain doubts on

 7     Thursday regarding the date quoted in Miletic and the date of this

 8     Official Note.  It's part of a set of documents but it's obviously not

 9     related to the report.  You don't know who the source is of this document

10     on the right-hand side, which has "Governor of the National Bank of

11     Yugoslavia" at the bottom?  You know nothing of the providence of this

12     document, do you?

13        A.   No.

14             MR. LUKIC: [Interpretation] Your Honours, I still stand by the

15     arguments I presented earlier.  I don't know how clear a picture I

16     succeeded in drawing for you, but before us we have two documents, both

17     unsigned, absolutely the same in substance but written in different

18     dialects.  I suppose it is indeed -- both documents are indeed from the

19     database of the Prosecution, but we cannot ascertain the authenticity

20     because even the expert witness cannot tell us who authored it, and we

21     know nothing else that could corroborate its authenticity.  The document

22     tendered by the Prosecution is P315, MFI, and they did not tender this

23     other one, probably to avoid complications.

24             JUDGE MOLOTO:  Mr. Lukic, let me just make sure that I'm

25     following everything that is happening.  Am I right in saying, in fact,

Page 1570

 1     it's not only two documents here, but there are three?  I thought before

 2     you called the document on the right side of the screen, there was

 3     another document here in B/C/S with a signature or a handwriting similar

 4     to the one on the left.  So it will be those two with their handwritings

 5     plus this one on the right.  Am I right?

 6             MR. LUKIC: [Interpretation] There are -- there is a total of two

 7     documents.

 8                           [Trial Chamber and registrar confer]

 9             JUDGE MOLOTO:  The registrar has answered my query.  Thank you so

10     much.  You may proceed.  Thank you.

11             MR. LUKIC: [Interpretation] Perhaps we could hear the arguments

12     that my colleague wishes to put forward.  I have said why I think the

13     document is not an authentic one.  Perhaps he can take the floor now.

14             MR. SAXON:  Your Honour, it's correct that the Prosecution has

15     tendered what is now MFI P323.  The Prosecution did not see the need to

16     tender both documents.  Your Honour, the fact that both documents are

17     substantively the same is an indication of their authenticity because

18     they corroborate each other.

19             Can we turn, please -- for the document on the left, we see what

20     looks like it's an illegible signature in the bottom left-hand corner.

21     Can we turn back to the first page, please.  This document, Your Honour,

22     MFI P323, was seized from Mr. Orsat Mijenic, who on the 25th of July,

23     2001, was the head of the Government of Croatia's Office for Cooperation

24     with the Hague Tribunal.  You'll see here in the upper right-hand corner,

25     it contains -- let me start with the left-hand corner.  I'm apologising.

Page 1571

 1     I'm messing up my left and right.

 2             In the upper right-hand corner, there are clerical notes.  Do you

 3     see the letters "12.05" and then "1994," indicating that this document

 4     has been formally processed.  This document is on the letterhead of the

 5     National Bank of Yugoslavia, and as I said before, it contains what

 6     appears to be a signature at the end, albeit illegible.

 7             Those, Your Honour, should be sufficient indicators of

 8     reliability and authenticity for the admission of this document.

 9             MR. LUKIC: [Interpretation] Just briefly, now that brings me to

10     an even greater problem.  I now have greater problems with authenticity

11     since it is from the Government of the Republic of Croatia, since I don't

12     see how they could come into possession of this document.  That's my

13     first point; and secondly, what it says there is a memorandum, not a

14     stamp.  It's not the reference number of the National Bank of Yugoslavia.

15     It's an Official Document - the expert can tell us about that - issued by

16     the National Bank of Yugoslavia, has the letterhead, memorandum, stamp,

17     and the number -- the reference number of the document.

18             So this reinforces my doubts about this document.  And the fact

19     that it exists in Ijekavian, which is the other dialect used in

20     Bosnia-Herzegovina and Croatia, that version of the Serbian language, and

21     written in the Cyrillic adds to my confusion and tells me that all this

22     is problematic, and I challenge the authenticity on that basis.

23             MR. SAXON:  Actually, Your Honour, the fact that the OTP received

24     this from the Government of Croatia, again, is an indicator of its

25     authenticity.

Page 1572

 1             At the time this document was produced in May 1994, the Federal

 2     Republic of Yugoslavia and Croatia were at war, thus there can be many

 3     reasons why the Government of Croatia might have obtained this document,

 4     and certainly the Government of Croatia thought the document was

 5     important enough to keep in its possession until 2001 when it turned it

 6     over to the Office of the Prosecutor, pursuant to a request.

 7             JUDGE MOLOTO:  Thank you.

 8             Mr. Lukic, I have a slight problem.  Your submissions, at page

 9     40, starting at line 4 to line 16, constitute in my prima facie view

10     essentially some kind of testimony, rather than argument.  But be that as

11     it may, I'm not holding it against you because obviously you are doing

12     your best to come to the rescue of the Chamber, and the Chamber does not

13     understand Cyrillic or B/C/S.

14             But be that as it may, our guidelines on the admission and

15     presentation of evidence and the conduct of counsel in court, at

16     paragraph 34, read as follows, and I would like to, in the light of your

17     objection, to give guidance to the Chamber as to what to do.

18              "There is no general prohibition on the admission of documents

19     simply on the grounds that their purported author has not been called to

20     testify.  Similarly, the fact that a document is unsigned or unstamped

21     does not a priori render it void of authenticity."

22             That is the guideline we have all agreed to go by, and I would

23     imagine that where a document is unsigned and unstamped, if it shows

24     relevance to the issues before the Court, we could accept it.  What do

25     you say we should say, given those guidelines?

Page 1573

 1             MR. LUKIC: [Interpretation] I am fully conscious of your

 2     guidelines, Your Honour, and you will recall that a large number of

 3     documents were admitted here during the proceedings so far that didn't

 4     take the form that I am presenting now and the Defence made no opposition

 5     to that large number of documents, because we considered that the

 6     contents of the documents were such that we were not in a position to

 7     challenge their authenticity.

 8             But looking at the format and form of this document, although it

 9     fulfills the conditions set down by the guidelines which would allow you

10     to accept its authenticity, because of the facts that I just presented, I

11     still challenge its authenticity.

12             Now, I would like the translation service perhaps to be called in

13     to a assist, if this is still a problem and you don't wish me to testify,

14     that the CLSS can give you their positions, stating whether they are

15     substantively the same text, provided in two different forms, if that

16     would help you.

17             I know that you have to weigh up the validity of the documents,

18     if you accept their authenticity or not.  But as I have just learnt from

19     the Prosecutor, except from the fact that they received it from the

20     Government of the Republic of Croatia, I cannot establish whether the

21     document is truly authentic.  The doors have just been closed.  So could

22     we retain the MFI and then perhaps the Prosecutor can tell me more

23     exactly about the source of the document and then we can establish its

24     authenticity better later on, in due course.

25             MR. SAXON:  May I respond?

Page 1574

 1             JUDGE MOLOTO:  If you may, sir.

 2             MR. SAXON:  What I find inconsistent, Your Honour, with the

 3     Defence's position, for example, just one example, on Thursday the Trial

 4     Chamber, without any objection from the Defence, admitted Exhibit P315.

 5     That is the Miletic report which, as far as I can see, has no stamp or

 6     signature.  And I don't understand why we're in a different situation

 7     with this document.

 8             JUDGE MOLOTO:  I guess we're in a different situation with this

 9     document, Mr. Saxon, because, as you say, the Miletic report is the

10     Miletic report, so the author is Miletic, so it is known who the author

11     is.  That may make the difference.  But I don't know why they objected --

12     they didn't object, rather, to that one.

13             At this stage, Mr. Lukic, what I wanted to ask you before

14     Mr. Saxon stood up was, you are now suggesting that we go to CLSS to

15     clear the problem.  I didn't get the feeling, or the impression, rather,

16     from your objection that you are challenging the substance of these

17     documents.

18             In fact, I thought your submission was that the substance was the

19     same, with slight language differences, but that they are talking to the

20     same issues.  So I do not think that referring these documents to CLSS

21     will resolve our problem.

22             Therefore, I am not quite sure whether you have responded

23     pertinently to the problem that I have posed, that the guidelines say we

24     can admit an unsigned, unstamped document, as long as it is relevant,

25     because when I put that to you, you then raised the question of CLSS.  I

Page 1575

 1     don't know whether you would like to respond to that again, or is that

 2     the end of your argument?

 3             MR. LUKIC: [Interpretation] No, I have no problem as far as the

 4     CLSS is concerned, as long as -- I see you've understood what I'm saying,

 5     that it is substantively the same where it says the governor of the

 6     National Bank of Yugoslavia in one document, but not in the other, but

 7     the contents are the same.

 8             Now, with respect to the guidelines is my doubt.  Looking at the

 9     format of this document, I am challenging its authenticity, but I am

10     fully conscious of the fact that it can be admitted into evidence as it

11     stands, even if the form doesn't correspond fully to what it should be.

12             JUDGE MOLOTO:  If you are aware of that, then may -- I think we

13     should then admit the document.  Obviously, the Chamber will give

14     whatever weight it gives to it.

15             MR. LUKIC: [Interpretation] Yes, I agree, Your Honour.

16             JUDGE MOLOTO:  Now, you must excuse me.  What document is this?

17     Is this P315, MFI?

18             MR. LUKIC: [Interpretation] That's right.

19             JUDGE MOLOTO:  That's the Miletic report?

20             MR. SAXON:  May I help?

21             JUDGE MOLOTO:  Yes, please.

22             MR. SAXON:  I believe this document is P323 that was marked for

23     identification.

24             JUDGE MOLOTO:  Oh, P323.

25             MR. SAXON:  Yes.

Page 1576

 1             JUDGE MOLOTO:  It is not 65 ter 6526, which you called P315, MFI,

 2     Mr. Lukic.

 3             MR. LUKIC: [Interpretation] No.

 4             JUDGE MOLOTO:  Okay.

 5             MR. LUKIC: [Interpretation] What Mr. Saxon just said, that's the

 6     note proposed by the Prosecutor, and it had the MFI number.  So I now

 7     agree to having the document admitted, but I'd also like to propose, Your

 8     Honours, that we admit the other document, the one we compared it to, so

 9     that you have both documents before you when you come to weigh up the

10     two, and that is part of ...

11             JUDGE MOLOTO:  If you finish your sentence, then I'll respond.

12             MR. LUKIC: [Interpretation] You know where the problem is, Your

13     Honour, the problem, as we see it, and I really do not wish to complicate

14     matters.  The problem is that it's 315 is Miletic's report; that's in

15     e-court.  The entire document, 80 pages long, within the frameworks of

16     which you will find this to, and as far as I understood your decision, it

17     was that only Miletic's report, 10-page report, be admitted.  So that's

18     why the whole issue has been complicated.

19             JUDGE MOLOTO:  You've confused me even further.

20                           [Trial Chamber and registrar confer]

21             JUDGE MOLOTO:  Mr. Lukic, I'm advised P315 is the first ten pages

22     of the Miletic report.  P323 is the Official Note.  Now, where I sit, I

23     am assuming that what we have on the screen are the two versions of the

24     Official Note; therefore, what we have on the screen is P323.  What I

25     don't know is which of these versions is actually P323, MFI, because the

Page 1577

 1     one you proposed now to tender so that we can compare, but I would like

 2     to be certain which one is already P323, MFI, between these two.

 3                           [Trial Chamber and registrar confer]

 4             MR. LUKIC: [Interpretation] It is the document, the MFI document,

 5     which is on the left-hand side of the screen.  To be precise it has the

 6     ERN number 0207-6891.

 7             JUDGE MOLOTO:  Okay.  That is P323, MFI.  And you are saying yes,

 8     we can now admit it into evidence.  May it then be admitted into evidence

 9     as an exhibit P323.

10             THE REGISTRAR:  The exhibit status of P323 will be changed, Your

11     Honours, accordingly.

12             JUDGE MOLOTO:  Fine.

13             Now, the other one on the right-hand side you now wish to tender

14     into evidence.

15             MR. LUKIC: [Interpretation] That's right.

16             MR. SAXON:  The Prosecution does not object, Your Honour.

17             JUDGE MOLOTO:  Then shall be give it a D exhibit number, please?

18     It is admitted into evidence.  Madam Registrar.

19             MR. LUKIC: [Interpretation] It is document, 65 ter list, 6526,

20     but I don't know now, because it is a large document, what the page

21     numbers are, or, rather, it's page 11.  If you can give us a number and

22     then I'll provide the Registry with the right numbers.

23             JUDGE MOLOTO:  Number of pages?

24             MR. LUKIC: [Interpretation] Yes, just three pages.

25             JUDGE MOLOTO:  Okay.  Can you give us a Defence exhibit number

Page 1578

 1     for that document, please.  65 ter 6526 is admitted into evidence.

 2             THE REGISTRAR:  That will be Exhibit D11, Your Honours.

 3             JUDGE MOLOTO:  Thank you so much.

 4             MR. LUKIC: [Interpretation]

 5        Q.   Well, we can move on now, Mr. Torkildsen, I believe.  I'm going

 6     on to another area altogether.  You mentioned a number of times during

 7     the examination-in-chief the fact that financing of the budget of

 8     Republika Srpska and the RSK, was from primary issue and that that ceased

 9     at the beginning of 1994; right?

10        A.   Correct, yes.  At least it stopped coming from sources without

11     any real backing in terms of the foreign currency deposits that we have

12     discussed.

13        Q.   Now, I've moved on to the period from 1994 onwards, and I'm going

14     to focus on that in my questions.  You didn't offer us a single document

15     which would show that the FRY in any other way took part in the financing

16     of the budget of RS and RSK in the 1994-1995 period.

17        A.   Not directly involving the budgets, no.

18        Q.   Yes.  That's what I was wondering.  Now, do you know what period

19     the indictment against Mr. Perisic incorporates, or, rather, have you

20     read the indictment against Mr. Perisic?

21        A.   I've never seen or read the indictment of Mr. Perisic.

22        Q.   The Prosecutor claims that it took -- he took over the function

23     of the Chief of the General Staff of the Army of Yugoslavia at the end of

24     August 1993.  That's what the Prosecution alleges.  Now, in analysing

25     your documents, did you come across any document which would have shown

Page 1579

 1     you that he, Mr. Perisic, was involved in any decision linked to primary

 2     issue and loans from primary issue of RS and RSK?  So I mean until the

 3     end of 1993, for instance.

 4        A.   No.

 5        Q.   You analysed, in particular, a document --

 6             MR. LUKIC: [Interpretation] May we have it called up.  It is

 7     P316.  May we have the English version, page 1, and the B/C/S.  It is a

 8     decision on the adoption of the rebalance for Republika Srpska for 1993,

 9     the budget revision for that period.

10        Q.   Now, do you know what the difference is between the budget

11     revision, or rebalance, and the final balance, final account balance?

12        A.   In this case I view this as the final accounts, since it's

13     mentioning here the session held on the 25th of March, 1994, and it is

14     regarding what took place in 1993.  I would then assume that they would

15     have managed to get all their figures correct so that this should

16     actually be -- be the annual accounts of Republika Srpska for 1993.

17     That's as far as I understand this.  Whether there are any sort of minor

18     adjustments after this, maybe --

19        Q.   I didn't actually ask you that.  We see the decision there.  I

20     asked you where the difference was in the professional sense, as an

21     expert here.  What's the difference between the rebalance or budget

22     revision and the final account, because -- the final balance, because

23     these are two different terms, as far as I'm concerned.  Can you explain

24     the difference?

25             JUDGE MOLOTO:  Mr. Lukic, I have a problem that I thought you

Page 1580

 1     used four terms, and I'm trying to look at your first question.  You're

 2     saying there are two issues.  Yes, you say at page 48, starting at line

 3     2:  "Now, do you know what the difference is between the budget revision,

 4     or rebalance, and the final balance, final account balance?"  I'm not

 5     quite sure whether you attach different meanings to those concepts.  How

 6     many concepts are you putting across to the witness here?  Budget

 7     revision, rebalance, final balance, final account balance?

 8             THE INTERPRETER:  Interpreter's note:  They used "budget

 9     revision" to mean "rebalance."

10             JUDGE MOLOTO:  Thank you very much, interpreter.

11             Sorry, what is the question, Mr. Lukic?

12             MR. LUKIC: [Interpretation] The question is:  Can the witness

13     explain to us, the expert witness explain to us, where the difference

14     lies between rebalance of the budget and final balance?

15             JUDGE MOLOTO:  Now, do we have "final balance" anywhere in these

16     documents?

17             MR. LUKIC: [Interpretation] No, it's not mentioned in this

18     document.  Just "rebalance" is mentioned here.

19             JUDGE MOLOTO:  Now, my question, then, is:  Of what relevance is

20     an interpretation of "final account" if it is not used here in these

21     documents?

22             MR. LUKIC: [Interpretation] Your Honour, I didn't say that.  The

23     witness said it.  The witness said that he considered this document to be

24     the final balance, and I'm saying that this document is called

25     "rebalance" and that "final balance" and "rebalance" are two different

Page 1581

 1     concepts.

 2             JUDGE MOLOTO:  I hope the question is slightly clearer -- is

 3     clearer to you and you can now answer.  Apparently "final account" is

 4     attributed to you.

 5             THE WITNESS:  I've never seen the term "rebalance" being used on

 6     the issue of accounting before in such a way, so I'm not even sure

 7     whether the translation is absolutely correct.  We all know that a budget

 8     is a plan and the accounts is what actually took place in the year.  But

 9     this term is something lying in between, the "rebalance."  Again, the way

10     that I view this is that this must either be the final accounts or it

11     must be very close to the final accounts, since the date here is a long

12     time after the year of 1993.

13             MR. LUKIC: [Interpretation]

14        Q.   Do you know that there's a law on the adoption of the final

15     account of the budget of a republic, whether it be RS or FRY or RSK, for

16     every fiscal year?

17        A.   I've heard that, yes.

18             MR. LUKIC: [Interpretation] Your Honour, I'd like to correct the

19     transcript.  On page 47, I didn't want to interrupt before, line 20, when

20     I asked the question linked to Mr. Perisic and the period when he was

21     appointed Chief of the General Staff, what I meant to say, and I think

22     the witness understood me correctly, I meant to say "from the point of

23     his appointment to the end of 1993, when primary issue was still

24     functioning," whether he came across a document of that kind, and he gave

25     us his answer.

Page 1582

 1             JUDGE MOLOTO:  You do say at line 20 --

 2             THE INTERPRETER:  Microphone, Your Honour, please.

 3             JUDGE MOLOTO:  I'm sorry.  "So I mean until the end of 1993, for

 4     instance," so you do say so.  Thank you.  You may proceed.

 5             MR. LUKIC: [Interpretation]

 6        Q.   Based on this decision, the decision we have before us on the

 7     adoption of the rebalance, as it says - interpreter's note - of RS

 8     budget, we see that considerable funds came from loans, and that's

 9     something you wrote in your report, too.

10        A.   Yes.  It's the credits, meaning the primary emissions,

11     originating from the NBY in Belgrade.  That makes up most of the revenue

12     side of this budget, yes, or annual accounts.  I'm sorry.

13        Q.   And you interpret that -- that's your interpretation.  But it

14     doesn't say what the source of these credits are in this decision, does

15     it?

16        A.   No, it doesn't.

17        Q.   Nor does it say when during the fiscal year those credits were

18     given.

19        A.   That is correct.

20        Q.   At all events, and you've already answered this question -

21     perhaps I'm focusing on this too much - but you didn't check or verify

22     whether any kind of crediting existed by the FRY in the budget of RS and

23     RSK in 1994 and 1995.

24        A.   I haven't seen anything in the FRY budget, if that was your

25     meaning, whether it's notification in that budget regarding the financing

Page 1583

 1     of the RS and RSK, if that's what you're -- if that is your question.

 2        Q.   Do you know whether the Army of Republika Srpska and RSK was

 3     financed exclusively from the budget, or not?

 4        A.   As we can see from this document, most of it would have been

 5     financed from the budget.  Whether there were other sources of finance,

 6     that I wouldn't know.

 7             Also, again, back to one of the documents that we saw on

 8     Thursday, it was a document from late December 1993 where they were

 9     discussing the financing of all three armies, and then the question would

10     be whether the amounts mentioned in that document, whether that would be

11     the same source of finance that we have in front of us here.  That I

12     would not know.  I can only state that they were planning to finance the

13     army, the VRS, also in 1994 by the VJ.  That's what is listed in that

14     document.

15        Q.   All right.  But from this document, you can see certain budgetary

16     resources allocated for the army.  Now, what I'm asking you is can you

17     see that there were other funds which were used to finance the army of

18     RS, from this document, just on the basis of this document?

19        A.   No.  It is listed here that the original income is very small out

20     of the total budget.

21        Q.   Yes, I agree.  Now let me follow on from that.  Did you hear

22     about the commodities reserve directorate or directives for commodity

23     reserves?  Does that mean anything to you?

24        A.   At least I can't remember that now.

25        Q.   Do you know that in Republika Srpska at the municipal level,

Page 1584

 1     considerable financial assistance was given, or any financial assistance

 2     was given to the Army of Republika Srpska separate from the budget?  Do

 3     you know anything about that?

 4        A.   No.

 5        Q.   Do you know that in 1992 the Government of Republika Srpska

 6     brought in a provision about war booty stored as commodity reserves?  I

 7     think that war booty is mentioned somewhere as a special area.

 8        A.   I have seen the reference to "war booty" in one of the military

 9     documents, yes.

10             MR. LUKIC: [Interpretation] Now may we call up document 6549,

11     please.

12        Q.   It's a short document, just a one-page document, and you referred

13     to it in your report.  It is the letter of Republika Srpska Krajina,

14     their government, dated the 20th of June, 1992, and sent to the Belgrade

15     bank, Beogradska Banka, in Belgrade, and I think you'll agree with me

16     that Beogradska Banka was a commercial bank of the FRY at the time.

17        A.   Yes.

18        Q.   Just briefly, this document speaks for itself, but would you

19     agree with me that the document says that certain funds of the RSK were

20     transferred to an account in Belgrade and that with this letter they're

21     asking for their money back; right?

22        A.   Yes.  It doesn't state anything about the source of the money,

23     but yes.

24             MR. LUKIC: [Interpretation] May we have a number for this

25     document.

Page 1585

 1             JUDGE MOLOTO:  The document is admitted into evidence.  May it

 2     please be given an exhibit number.

 3             THE REGISTRAR:  That will be Exhibit D12, Your Honours.

 4             JUDGE MOLOTO:  Thank you very much.

 5             MR. LUKIC: [Interpretation]

 6        Q.   Now I'd like us to look at another document that you referred to

 7     earlier.  It's 65 ter 6551.  You mentioned it in your report in paragraph

 8     68.  Would you agree with me that from this document, we don't see the

 9     source of the money that is mention in the document, or, rather, who is

10     selling -- sending what money to whom.

11        A.   The letter here is addressed to the MUP of the Republic of

12     Serbia, and it's coming from the Republic of Serbian Krajina, the RSK

13     MUP.

14        Q.   Yes, I'm not challenging that at all.  My question was:  In the

15     first sentence is about money following -- to escort the transport of

16     money from Belgrade to Knin.  So whose money, and where is it going?

17     That's my question.

18        A.   Well, it's going to the RSK, and it's being -- basically, they

19     are asking for assistance in having this transferred, and they're making

20     a request to the MUP of the Republic of Serbia.

21        Q.   Look at the last paragraph.  I understand the document to read

22     quite differently, quite the opposite.  It is just sent to the border

23     service of the police for the possible transfer or, rather, travelling of

24     vehicles.

25             But I ask just you this:  From the document, can we see who is

Page 1586

 1     sending the money from whom?  Because you refer to this document in the

 2     report.  So can that be seen on the basis of this document?  Who is

 3     sending the money, and who is the money going to?

 4        A.   Well, I can't see where the money actually originates from,

 5     whether it's from a primary issue or whether it's something else.  I can

 6     only see that it's being -- the money is being requested by the RSK and

 7     the transportation of this money is being facilitated by -- by the MUP of

 8     the Republic of Serbia.

 9        Q.   So do I understand you correctly?  On the basis of this document,

10     you see that RSK is asking for money; right?

11        A.   Yes.

12        Q.   Is that what you said?

13        A.   Yes.

14        Q.   Thank you.

15             MR. LUKIC: [Interpretation] I'd like to tender this document,

16     please.

17             JUDGE MOLOTO:  The document is admitted into evidence.  May it

18     please be given an exhibit number.

19             THE REGISTRAR:  That will be Exhibit D13, Your Honours.

20             JUDGE MOLOTO:  Thank you so much.

21             MR. LUKIC: [Interpretation]

22        Q.   I'd like to go on to another area now regarding financial

23     assistance by the Army of Yugoslavia to the Army of RSK.

24             JUDGE MOLOTO:  I'm sorry to do this to you.  Can we have that

25     exhibit back on the screen, please.  I have a small question to ask.  I'm

Page 1587

 1     sorry, Mr. Lukic.

 2             Mr. Torkildsen, are you able to show -- tell us, on the left --

 3     the document on the left side of the screen, whether what is written by

 4     hand on the right side is also shown on the left side?  And if so, what

 5     it is?  "Predato, 05.11.1996," do we see it on the other side?  And the

 6     author of this document doesn't seem to be mentioned on this side.

 7             THE WITNESS:  Your Honour, the way that I read this, I think it's

 8     a date, the 5th of November, 1993.

 9             JUDGE MOLOTO:  Thank you very much.  The next page of the English

10     version was shown.  Okay.  It might go.  Thank you.

11             Sorry, Mr. Lukic.

12             MR. LUKIC: [Interpretation]

13        Q.   I'm now going to move on to another area that you address in

14     paragraph 121 about this assistance to the Army -- rather, from the Army

15     of Yugoslavia to RSK, and I'd like to ask you the following:  I'm going

16     to paraphrase what you say, but anyway, you say that financial assistance

17     of the Army of Yugoslavia was sent to the Army of Republika Srpska in

18     such a way as to -- regarding the payment of salaries to VRS members,

19     financed by the FRY.  That's the substance of your claims there; right.

20        A.   Yes.

21             MR. LUKIC: [Interpretation] May we call up P149.  The B/C/S page

22     is 111.  It is English page 127.  127 of the English and 111 of the

23     B/C/S.

24        Q.   You testified about that on Thursday; 1476 is the transcript

25     page.  But, first of all, let's set the time period.  This document

Page 1588

 1     relates to the situation and analyses the situation in the Army of

 2     Republika Srpska in 1992, and that's what the document says in its title;

 3     right?

 4        A.   It actually analyses the situation until the 20th of February,

 5     1993.

 6        Q.   Did you have an opportunity of seeing analyses of this kind of

 7     the Army of Republika Srpska for 1993, 1994, and 1995?

 8        A.   A similar analysis like this, no, I don't recollect that.  No.

 9        Q.   In your work you did not analyse the resources from primary

10     issue, as you claim, during that period.  What resources, what funds,

11     were used to help out the budget of Republika Srpska?  And that includes

12     the military budget by the same token because you didn't analyse the

13     budget of Republika Srpska for 1992, so you don't have figures which the

14     FRY allegedly helped the VRS.

15        A.   I have seen a budget or, actually, the annual accounts of

16     Republika Srpska for 1992, and that should also be referred to somewhere

17     in my report.  But just to clarify that, that specific budget or annual

18     accounts do not itemize on a detailed level what the use of the money was

19     for.  It states that the revenue side of the budget originates from

20     credits or primary emissions, but it doesn't detail out what it was spent

21     for.

22        Q.   You said last Thursday, it was your theory that the financing of

23     the officers and the other categories of personnel listed here came

24     directly from the FRY, non-commissioned officers, and so on, and then you

25     said that all the other members of the VRS were practically financed by

Page 1589

 1     the FRY as well, because the budget of Republika Srpska received monies

 2     in such large amounts from the budget of the FRY.  But that was just your

 3     assumption.  You did not show us any evidence that the VRS was financed

 4     from the budget to that extent, the budget of the FRY.

 5        A.   Well, in 1993 the budget that we just looked at, or the rebalance

 6     of the budget, that was exactly the situation, so -- but when it comes to

 7     1994 and 1995, I haven't seen the RS budget so I can't comment on that.

 8             MR. LUKIC: [Interpretation] I think this is the time for the

 9     break, Your Honour.

10             JUDGE MOLOTO:  Very well.  Is that a convenient time for you?

11     We'll take a break and come back at a quarter to 6.00.  Court adjourned.

12                           --- Recess taken at 5.16 p.m.

13                           --- On resuming at 5.47 p.m.

14             JUDGE MOLOTO:  Yes, Mr. Lukic.

15             MR. LUKIC: [Interpretation]

16        Q.   Mr. Torkildsen, I will try to ask questions that warrant brief

17     answers.

18             MR. LUKIC: [Interpretation] May I call up P149.  We need B/C/S

19     page 112 and, in English, 127.  In fact, we already have them.

20        Q.   Do you know, Mr. Torkildsen, and now I'm talking about these

21     salaries received by the officers of the VRS and SVK, do you know how

22     much in absolute numbers the Federal Republic of Yugoslavia paid in any

23     specific year for the salaries of these officers in the VRS and the Army

24     of the Serbian Krajina?

25        A.   No.

Page 1590

 1        Q.   I put up this document because in the B/C/S version, and we see

 2     it in the English version, too, "Accounting Centre, JNA."  Do you know

 3     what this accounting centre is?

 4        A.   The Accounting Centre of the JNA, no, I don't, if you're not

 5     referring to the establishment of the 30th and 40th Personnel Centres,

 6     but that should be in 1993.  So at this point in time I don't know.

 7        Q.   My question is this:  Do you know that there was a Military

 8     Accounting Centre of the JNA with the Ministry of Defence?  Do you know

 9     about this institution and what its job was?

10        A.   I heard about the institution, but I don't know any details about

11     how it operated and what was its job.  But I would, again, assume that it

12     was their job to make track of the bookkeeping of basically who received

13     what in salary, what were their entitlements in terms of pension and

14     other allowances, and so on.

15        Q.   You have heard about the 30th and 40th Personnel Centres, and you

16     mentioned them in your report.  But I'm asking you about the Military

17     Accounting Centre, and I believe these are two different institutions.  I

18     just asked you if you knew that the Military Accounting Centre existed

19     within the framework of the Ministry of Defence.  That was my question.

20     Nothing more.

21        A.   I have seen reference to that accounting centre in the report

22     that I have in front of me and most likely in other documents, but I

23     don't know any details about it.

24        Q.   Do you agree with me that the Ministry of Defence is an organ, an

25     agency of the government, in every state?

Page 1591

 1        A.   Yes, I do.

 2        Q.   But let us speak only of the Ministry of Defence of the FRY.  The

 3     next questions will refer specifically to the FRY.  Do you agree that the

 4     Ministry of Defence, as an organ of the government, was answerable to the

 5     Assembly, the parliament?

 6        A.   Yes.

 7        Q.   Would you agree that the Ministry of Defence is completely -- let

 8     me put it this way:  Do you agree that in terms of financing of the VJ,

 9     the Army of Yugoslavia, the Ministry of Defence is superior to the

10     General Staff?

11        A.   When it comes to financing, that sounds reasonable, yes.

12        Q.   Have you looked at the budgets of the FRY for 1993, 1994, and

13     1995?

14        A.   I have looked at budgets of the FRY, but I can't remember now for

15     which years.

16        Q.   Would it refresh your memory if I said there was a special rubric

17     for defence within the budget and within that rubric for defence a

18     special item was -- a separate item was the army?  Would that help?

19        A.   Well, it doesn't refresh my memory, but what you're stating

20     sounds -- sounds natural, that that would be itemized in the budget, yes.

21        Q.   In the part of the budget relating to the army, is it the case

22     that the amount for salaries has to be indicated separately?

23        A.   That depends on the detail level of the budget or the annual

24     accounts, whether it's specifically itemized in that respect.

25        Q.   Do you know who made the decision on the financing of the

Page 1592

 1     officers of the VRS and the SVK by the Federal Republic of Yugoslavia?

 2        A.   From what I remember, since these documents were not part of my

 3     report, so then I have to base this on my recollection of all the

 4     documents I have seen, and from what I remember, the 30th Personnel

 5     Centre, meaning concerning the officers of the VRS, and the 40th

 6     Personnel Centre, concerning the officers of the SRK army, those two

 7     personnel centres were established by the then-President of the FRY,

 8     Mr. Zoran Lilic.

 9        Q.   Is it the case that the financing of officers of the VRS and SVK

10     came from the FRY even before the establishment of the 30th and 40th

11     Personnel Centres, as far as their salaries are concerned?  Or let me be

12     more precise.  Maybe you don't know when these personnel centres were

13     established, but it was in the autumn of 1993.

14        A.   Yes.  I think, actually, it was in November 1993, and before that

15     the salaries of the officers of the VRS and the Army of the RSK were

16     directly under the -- falling under the obligation of the VJ.

17        Q.   And who made the decision before that time that these finances

18     should be released, that these funds should be released?  Do you know?

19        A.   No, I don't.

20        Q.   The financing of salaries of the officers of the VRS and SVK in

21     1993, 1994, and 1995, was it continuous?

22        A.   Well, at least that's -- that is my understanding.  I haven't

23     seen any documents regarding they not being -- this financing not being

24     continuous.

25        Q.   Do you know, perhaps, what was the base level for those salaries?

Page 1593

 1     Was it the same as for the salaries of the Army of Yugoslavia, or was it

 2     different?  Did you see any document that would specify the base for

 3     calculating these salaries?

 4        A.   I might have seen documents.  I can't remember anything regarding

 5     the base level of those salaries.  What I do remember is that the

 6     officers serving in the VRS and the SVK, they got some additional pension

 7     contributions and, if I remember correctly, also some additional

 8     allowances.  But regarding the salaries, I can't remember whether the

 9     basis there was the same or not.

10        Q.   Salaries are paid from the part of the budget designated for the

11     army, "the military budget," let's say, although the term does not exist

12     legally.

13             JUDGE MOLOTO:  Is that a question?

14             MR. LUKIC: [Interpretation] Yes.  Possibly, yes.  That was the

15     question, indeed.

16        Q.   Is it the case that salaries are paid from the military part of

17     the budget, the part of the budget intended for the army?  Is that the

18     source for salaries?

19        A.   Well, that sounds reasonable that the salaries for the officers

20     were paid from the budget, except in this case, we have seen that that

21     was not actually what happened, since -- and that's what we have referred

22     to -- I have referred to previously.

23        Q.   If I understood correctly what you said earlier, I'm now talking

24     about the salaries of the officers of the Army of Republika Srpska and

25     the Army of Serbian Krajina.  Are you claiming that their salaries were

Page 1594

 1     not financed from the part of the budget intended for the Army of

 2     Yugoslavia but from somewhere else?

 3        A.   No, no.  The officers were, of course, paid by the -- what must

 4     have been the budget of the VJ.  I would assume at least it must have

 5     been -- if it was not like that, it must have been paid from some other

 6     funds controlled by the VJ, but that I wouldn't know about.

 7        Q.   But you have not seen evidence of that?

 8        A.   Regarding other funds controlled by the VJ?  No.

 9        Q.   Would you agree that the control over the way funds from the

10     budget were used, specifically the military funds, was exerted by the

11     Ministry of Defence and the Ministry of Finance.  It was their job to

12     verify that the funds were used as intended.

13        A.   At least that should be the case, yes.

14        Q.   In your analysis in your report, did you come across any document

15     establishing that the General Staff or the Chief of the General Staff was

16     disposing of certain funds without the consent of the Ministry of Finance

17     and the Ministry of Defence?

18        A.   No.

19        Q.   Again, in preparing this report, you did not refer to any

20     documents emanating from the 30th and the 40th Personnel Centres, did

21     you?

22        A.   That is correct.  That was dealt with by other personnel at the

23     OTP.

24        Q.   Mr. Torkildsen, when you speak about the financing of the VRS and

25     the SVK by the Federal Republic of Yugoslavia, in your evidence on

Page 1595

 1     Thursday you made conclusions that this financing was granted in 1994 and

 2     1995 exclusively on the basis of documents showing requests addressed to

 3     the FRY, but you did not produce a single document showing that the FRY

 4     effectively sent some funds to the SVK and the VRS.

 5             To be more precise, on page 1491, let me read this verbatim:

 6             "[In English] There is a lack of documents compared to the

 7     previous period in order for me to conclude how it -- this was done.  I

 8     can see that the VRS and the institutions of Republika Srpska are

 9     requesting money, but I can't really see how this is done in practice."

10        A.   That is correct, yes.

11             MR. LUKIC: [Interpretation] I would now like to call up P317,

12     page 1.  When I looked at the Thursday transcript, I believe it was the

13     position of Mr. Saxon - that's how it was recorded in his question - that

14     this is a document issued by the Army of Yugoslavia, whereas my theory is

15     quite the opposite, so let us look at this.

16        Q.   It's page 1492, in fact, of the official transcript, line 19.

17     It's Mr. Saxon's question.

18             JUDGE MOLOTO:  Yes, Mr. Saxon.

19             MR. LUKIC: [Interpretation] Sorry, it's line 8.

20        Q.   Mr. Saxon says concerning this document:

21             [In English]:  "... from the General Staff of the Yugoslav Army

22     to the Office of the Chief of the General Staff."

23             JUDGE MOLOTO:  Yes, Mr. Saxon.

24             MR. SAXON:  I'm very sorry to interrupt.  Maybe this will save

25     some time.  I believe I misspoke at that time.  If I can clarify the

Page 1596

 1     record and save some time, I should not have used the word "from" before

 2     the General Staff of the Yugoslav Army.

 3             MR. LUKIC: [Interpretation] Right.  Well, if that is so, because

 4     my theory is that this document was sent by the head of the office of the

 5     commander of the Serbian army of Krajina.  It's a ten-page document, and

 6     I believe it's clear from the entire document who the author is.

 7             Then I'll ask a different question.

 8             But we will need page -- the one you looked at when you testified

 9     in direct examination, that is, the last page but one.  Page 13 in

10     English.  Last page but one.  That's one page before this.  And 10 in

11     B/C/S.

12        Q.   The part below that you analyzed, I'll read again.  So the author

13     of this document, which comes from the Army of Serbian Krajina, says:

14             "Unofficially we learned that the federal government would, out

15     of the total balance of requirements demonstrated in 1994, will be able

16     to provide for all three armies.  Instead of 93 billion, only

17     80-something billion."

18             Now, I want to ask the following:  The document before, as you

19     saw, was made in December 1993.  That is before the adoption of the

20     Avramovic programme and above the thorough overhauling of the monetary

21     system in the FRY; correct?

22        A.   Yes.

23        Q.   And this document was written at a time when primary issue was

24     still used as a source of finance.

25        A.   Yes.

Page 1597

 1             MR. LUKIC: [Interpretation] Let us turn to the next page.

 2        Q.   Speaking of the reserves of fuel expended and the problems

 3     experienced by the Serbian Army of Krajina with fuel, and then it says:

 4             "To alleviate the consequences of this measure, please lift the

 5     ban of issuing diesel fuel in Bubanj Potok because we have repaid the

 6     debt, and we will repay the value of the fuel according to the

 7     timetable."

 8             From this I can conclude that certain payments were made to

 9     Federal Republic of Yugoslavia by the Serbian Army of Krajina for

10     purchases of fuel; correct?

11        A.   Well, I don't know the details about the payment here, but what

12     you are stating here makes reason.

13             MR. LUKIC: [Interpretation] Now I would like to move on to P322,

14     page 1 in B/C/S and the English as well.  That's the appeal of

15     Mr. Milosevic of the decision to remand him in custody.

16        Q.   You referred to it both in your report and in direct examination.

17     I had a look at that paper of yours that you made for the Prosecution

18     that was not admitted regarding offshore companies and financial

19     transactions from the year 1994 through to the year 2000, so I suppose

20     you are familiar, if not from that analysis then from this appeal,

21     namely, the second paragraph, you know why proceedings were instituted

22     against Mr. Milosevic before the District Court in Belgrade.  Can you

23     tell us something about the facts, if you know of this?

24        A.   I can't remember the details, but from what I remember, there

25     were some kind of fraud charges against him and some other persons as

Page 1598

 1     well.

 2        Q.   As he says in the explanation of his appeal, he was charged with

 3     instigating certain civil servants on the federal level to gain benefit

 4     for others in the period from 1994 to 5 October 2000.  You have been to

 5     Cyprus, I suppose, and you've analysed this documentation.

 6        A.   Yes.

 7        Q.   In the documents that you analysed, did you come across any

 8     document showing the financing of the VRS and the Army of Serbian Krajina

 9     in 1994 and 1995 with funds outside of the budget of the FRY?

10        A.   Yes.  There were funds diverted from the budget of the FRY that

11     actually ended up in Cyprus, the Republic of Cyprus, and then the funds

12     again were used to purchase various commodities.  It was hospital

13     equipment, it was food, but there were also some sort of military

14     equipment.

15        Q.   I read that in your report, but did you find that this equipment

16     bought in this way was sent to the Army of Republika Srpska or the Army

17     of Serbian Krajina?  Because you spoke of financing of groups and the

18     Army of Yugoslavia, and I'm interested here in something quite different.

19        A.   Today, I can't remember actually what groupings were the

20     beneficiary of this, but at least I can state that I can't remember that

21     to any large extent that the RS army or the SVK was financed from these

22     funds, no.

23        Q.   I'll now move to my final questions.

24             In paragraph 9 of your report, and that's the summary and

25     introduction - page 3 in English and page 3 in B/C/S of P310 - you say --

Page 1599

 1     I'll be reading in Serbian, and I'll wait for it to come up on the

 2     screen.

 3             "The documents strongly indicate that funding for the Army of

 4     Republika Srpska and the Army of the Republic of Serbian Krajina emerged

 5     from a single financing plan for all three Serb armies - the Yugoslav

 6     People's Army," that is, the JNA, "the VRS and the SVK."

 7             That is part of your summary of conclusions.

 8             On page 1493, last Thursday, you said:

 9             [In English] "As we can see here, it is the FRY government who's

10     actually planning to fund all three armies in -- also in 1994, but

11     they're getting less than they originally had planned for.  As I

12     mentioned previously, even if the financing through primary emissions

13     stopped, at least they were still planning to continue the financing in

14     1994, by then a different method.  But then again, as I pointed out, when

15     it comes to 1994, there has been a lack of documents for me to review."

16             [Interpretation] Aren't these two things contradictory?  I'm

17     interested in the period of 1994 and 1995.  Do you still maintain what

18     you said in paragraph 9?  Because your report applied to a much broader

19     period, and we are here discussing a narrower issue.

20             In this part regarding 1994 and 1995, can you confirm that there

21     are indeed no documents confirming the financing of these two armies by

22     the FRY?

23             MR. SAXON:  Your Honour, before the witness answers --

24             JUDGE MOLOTO:  Yes, Mr. Saxon.

25             MR. SAXON:  -- there are at least two questions in that last

Page 1600

 1     question, if I may, of my learned colleague.  It starts off with "Aren't

 2     these two things contradictory?"  and then later on, "Do you still

 3     maintain what you said in paragraph 9?"  I'm wondering whether the

 4     witness could deal with each question one at a time.

 5             JUDGE MOLOTO:  Mr. Lukic.

 6             MR. LUKIC: [Interpretation] All right.

 7        Q.   You heard my first question.  Do you think what you said in

 8     paragraph 9 and what I read from your testimony on Thursday are in

 9     conflict?

10        A.   Well, just to repeat, it's that, as we have seen from that

11     December 1993 document originating from the command of the SVK, it

12     clearly states that they were planning for financial funds also in 1994.

13     And I would also like that -- it's not very reasonable that they keep

14     requesting cash in 1994 and 1995 if they did not think that they would

15     get any financial funding.  But, as you have pointed out, I haven't seen

16     that they actually got a positive reply to their requests.  That is

17     correct, yes.

18        Q.   You just mentioned this document we analysed a moment ago where

19     the Army of Republika Srpska mentions that they had heard officially that

20     there will be financing -- there would be financing from the FRY for all

21     the three armies.  That's the only reference I saw in your work, that

22     quotation where you mentioned these three armies were funded from a

23     single source.

24        A.   Well, also the budgets that we have gone through previously

25     regarding 1992 and 1993, they point in the same direction when it comes

Page 1601

 1     to the financing of all three armies.

 2        Q.   You are talking about 1992 and 1993, in fact 1993, about

 3     financing from primary issue.

 4        A.   Yes.

 5        Q.   But you cannot say the same about 1994 and 1995.

 6        A.   No, I have not seen any other documents, other than the one we

 7     have now just discussed.  Yes.

 8        Q.   Briefly, a comment on your paragraph 8.

 9             "This support was provided from 1991 until 1995, although the

10     nature and degree of this support varied throughout that period."

11             Let us go to the final conclusion based on all the answers I got

12     from you.  You did not review the budget of the Republika Srpska and the

13     Republic of Serbian Krajina for 1994 and 1995; correct?

14        A.   Correct, yes.

15        Q.   Therefore, you are not able to tell us whether these budgets in

16     1994 and 1995 were financed from direct, real sources.

17        A.   No.  Since I haven't seen them, no.

18        Q.   Nor can you say here before the Court how much compared to the

19     budget allocation for the Army of Republika Srpska and the Army of

20     Serbian Krajina from their own entities is accounted for by the salaries

21     of the officers of the VRS and SVK that came from the FRY.

22        A.   I don't know the amounts, no.

23        Q.   Paragraph 124 of your paper, the final conclusion.

24             Let me be more precise with the previous question.  I'm looking

25     at it as a lawyer, and I'm trying to understand.  There is, let's say,

Page 1602

 1     the budget of Republika Srpska consisting of 100 units of something.  You

 2     did not establish how many units intended for the salaries of the

 3     officers of the Army of Republika Srpska came from the budget of the FRY.

 4     You cannot tell us that, can you?

 5        A.   I thought that the whole -- that the salaries of the VRS were in

 6     total paid by the FRY.  I never heard anything about the salaries of the

 7     officers of the VRS coming from the budgets of the RS.  The budget of the

 8     RS covered the salaries of the ordinary soldiers and not the salaries of

 9     the officers.

10        Q.   That much is clear, but I wanted to do something that I think is

11     important for us in this courtroom.  It's important for us to establish

12     that if an army receives a total amount of something in one year, what

13     part of that total is accounted for by what they received from the

14     Federal Republic of Yugoslavia?  Do you have that parameter?  Were you

15     able to establish that?

16        A.   No.

17        Q.   And now, in conclusion, let me just not forget this:  When I

18     asked you about your CV on the first day, I asked you whether you had

19     ever appeared as an expert witness before the International Court of

20     Justice and you told me yes, in the proceedings instituted by Bosnia and

21     Herzegovina against the Federal Republic of Yugoslavia.  And I asked you

22     in what capacity you appeared, and you said "legal consultant,"

23     "consultant lawyer," for Bosnia-Herzegovina.

24        A.   What I -- I did not --

25             JUDGE MOLOTO:  Mr. Saxon.

Page 1603

 1             MR. SAXON:  There may have been a translation problem.  Can we

 2     have the citation to the transcript, please?

 3             MR. LUKIC: [Interpretation] I probably put the question in that

 4     way because I read the witness's testimony before the ICJ, and I asked

 5     whether his expertise -- his expert report was used.  But my question was

 6     only in what capacity.

 7             JUDGE MOLOTO:  Can you refer us to the citation of the

 8     transcript, Mr. Lukic, please.  That is what your learned friend is

 9     asking for.

10             MR. LUKIC: [Interpretation] Just a moment.  That was at the

11     beginning of my cross-examination.

12             JUDGE MOLOTO:  What page?  What line?

13             MR. LUKIC: [Interpretation] Yes, yes, Your Honour.  I understand.

14     Page 1504 -- sorry, 16 -- no, 1506, the transcript from Thursday.

15             JUDGE MOLOTO:  Line?

16             MR. LUKIC: [Interpretation] Line 1.  Let me see if this is the

17     correct page.

18             THE WITNESS:  Your Honour, I don't mind answering the question,

19     if possible.

20             JUDGE MOLOTO:  Just a second.  There's an objection on the floor,

21     sir.

22             Mr. Saxon.

23             MR. SAXON:  It's just that no where on page 1506 do I see the

24     witness saying he was a legal consultant.

25             MR. LUKIC: [Interpretation] Perhaps my question was

Page 1604

 1     misinterpreted.  That's what I wanted to ask.

 2             JUDGE MOLOTO:  [Previous translation continues] ... on line 1,

 3     page 1506, Mr. Lukic, please.

 4             MR. LUKIC: [Interpretation] My question.

 5             [In English] "The report of yours with certain additional

 6     amendments in the fact represented, if I can put in this way, the

 7     substance of your expert finding before the International Court of

 8     Justice, pursuant to the complaint made by Bosnia-Herzegovina and the

 9     lawsuit against the state community of Serbia and Montenegro which was

10     conducted two years ago," and the answer was yes.

11             [Interpretation] I just wanted to ask the witness an additional

12     question on the same topic, in what capacity he was acting at the time.

13     That is the question I wanted to ask now.

14             JUDGE MOLOTO:  Yes, because he didn't give the capacity in which

15     he acted in that statement that you are referring us to, so he didn't say

16     he was a legal assistant -- legal expert.

17             Are you able to answer that, sir?

18             THE WITNESS:  Yes, Your Honour.  I was part of the team pleading

19     the case for Bosnia and Herzegovina.  What I did was that I gave a

20     90-minute presentation on the financial issues.

21             JUDGE MOLOTO:  Thank you.

22             Yes, Mr. Lukic.

23             MR. LUKIC:  Okay.

24             [Interpretation] Just a moment.  All right, thank you.

25        Q.   Paragraph 124 of your report, the final conclusions.

Page 1605

 1             Let me put it this way:  In your work, in your research, you did

 2     not refer to a single document passed by General Perisic and the General

 3     Staff of the Army of Yugoslavia during the period that he was chief?

 4        A.   I can confirm that I did not point to any documents with the name

 5     of General Perisic.  That is correct.

 6        Q.   He wasn't one of the people that you referred to in paragraph 124

 7     of your report.

 8        A.   At least I do not remember his name being on any of the

 9     documents.  In order to look at that -- address that specifically, then I

10     would have to look at all the documents again and see actually which

11     organs of the FRY the -- these documents dealt with, who did the requests

12     and who actually replied to these documents.  But I can confirm that I've

13     never seen his name on any of the documents; that is correct.

14             MR. LUKIC: [Interpretation] That completes my cross-examination,

15     Your Honours.

16             Thank you, Mr. Torkildsen.

17             JUDGE MOLOTO:  Thank you, Mr. Lukic.

18             Mr. Saxon, any re-examination?

19             MR. SAXON:  Please, Your Honour.

20                           Re-examination by Mr. Saxon:

21        Q.   Mr. Torkildsen, earlier today Mr. Lukic -- this was at page 51 of

22     today 's transcript, line 17 to 21, where you said:  "Most of the Army of

23     the RSK --" excuse me, "Most of the Army of the RSK, as well as the

24     Republika Srpska, were financed from the budget."  So can you recall who

25     financed the officers serving in the VRS and the SVK?  Who paid their

Page 1606

 1     salaries?

 2        A.   That was the FRY or the VJ.

 3        Q.   Okay.  Page 24 of today's transcript, my colleague asked you

 4     about the date 1 March 1994, which you mention at page 45 of your report.

 5             MR. SAXON:  Can we see Exhibit P323, please.

 6        Q.   My colleague asked you where you came up with that date.

 7        A.   Yes, and I actually think that we saw that date on one of the --

 8     yeah, exactly the document that is in front of me now.

 9        Q.   Just wait for the English, please.

10             MR. SAXON:  Can we go to the next page in the English, please,

11     and if we focus on the first full paragraph, please.

12        Q.   The first full paragraph says:

13             "Based on these documents the Programme for Reconstructing the

14     Monetary System is being implemented in the territory of Republika Srpska

15     and the Republic of Serbian Krajina as of 1 March 1994."

16             Can you recall now --

17             JUDGE MOLOTO:  Yes, Mr. Lukic.

18             Yes, Mr. Saxon, you may proceed.

19             MR. SAXON:

20        Q.   Can you recall now where you located the date that you referred

21     to in paragraph 45 of your report?

22        A.   That must have been from this document, the second paragraph in

23     the translation on this page.

24             MR. SAXON:  Can we please turn to the next page in both versions,

25     please, and if we can -- no.  Can we please focus on paragraph 7 in the

Page 1607

 1     English and in the B/C/S, please.

 2        Q.   If you look at paragraph 7, Mr. Torkildsen, it says:  "The

 3     Governor of the National Bank of Republika Srpska and the Governor of the

 4     National Bank of the Republic of Serbian Krajina are required to attend

 5     the sessions of the Council of the Yugoslav National Bank without a

 6     voting right."

 7             What, if anything, of significance do you take from subparagraph

 8     7?

 9        A.   That was the issue of subordination that I was trying to address

10     earlier today.

11        Q.   And who was being subordinated to whom?

12        A.   It was the governor of the Yugoslav National Bank in Belgrade

13     being in charge and the governors of the National Bank of the RS and the

14     National Bank of the RSK being subordinated to the governor of the NBY.

15        Q.   Moving to another topic, on Thursday at page 1519 of the

16     transcript, lines 10 through 13, Mr. Lukic asked you:

17             "In this report when you prepared this paper, you worked

18     exclusively on the basis of what was provided to you by the OTP, am I

19     right?"  And you answered:  "Almost exclusively."

20             Earlier in your direct testimony, at page 1446, lines 5 to 20,

21     you described how, with the assistance of language personnel, you did

22     searchs on the electronic evidence system of the OTP.

23             JUDGE MOLOTO:  Yes, Mr. Lukic.

24             MR. LUKIC: [Interpretation] I think that my learned friend is now

25     trying to lead the witness, asking the question in that way by extracting

Page 1608

 1     this portion.

 2             MR. SAXON:  Your Honour, I haven't asked a question yet.  I'm

 3     just describing the witness's testimony on Thursday.  I have not asked a

 4     single question.  I'm just saying what he said on page 1446.

 5             JUDGE MOLOTO:  Okay.  Objection overruled.

 6             MR. SAXON:

 7        Q.   At that time, when you were making these electronic searches,

 8     Mr. Torkildsen, did the OTP's electronic collection of evidence contain a

 9     lot of material?

10        A.   Yes.  We are talking about thousands and thousands of documents.

11        Q.   And can you recall whether the number of pages of material

12     electronically searchable from the OTP's electronic collection of

13     evidence was in the tens, hundreds, thousands, or more?

14        A.   More.  I don't know the exact number, but it was a huge

15     collection.

16        Q.   Did this electronic collection of evidence contain materials

17     relevant to different topics or just to financial materials?

18        A.   Different topics, most not of -- not regarding financial issues.

19        Q.   So can you describe briefly, then, how did you conduct your

20     searches on the electronic evidence system?

21        A.   I conducted searches by typing in different search criteria, like

22     "bank," "finance," "dinars," "budget," "accounts," et cetera.

23        Q.   During these searches -- let me step back for a moment.  And did

24     you devise these search terms?

25        A.   Yes, I did.

Page 1609

 1        Q.   During these searches did you personally select the documents

 2     that you believed were relevant to your task?

 3        A.   Yes, I did, and of course I had to use language personnel in

 4     order to assist me, since I don't read or understand the language.

 5        Q.   Did anyone in the Office of the Prosecutor limit your ability to

 6     search this electronic collection of evidence?

 7        A.   No.

 8             MR. SAXON:  I have nothing further, Your Honour.

 9             JUDGE MOLOTO:  Thank you very much.

10                           Questioned by the Court:

11             JUDGE DAVID:  Mr. Torkildsen, in page 31 and 32 of your report,

12     you discuss the circumvention of UN Security Council Resolution 757.  In

13     paragraph 31 you talk about the restructure work in industry was, in

14     part, allowed to circumvent this resolution and also the creation of a

15     new federated system of national banks is discussed in paragraph 32.

16     These indications will also apply to the primary issues, which is the

17     printing of money, and also to the grey issues that you discussed later

18     on in various paragraphs, especially number 79 and others.  Would that

19     apply also, this circumvention of UN Security Council resolutions?

20        A.   Yes, Your Honour.

21             JUDGE DAVID:  Last question.  You said on Thursday that the

22     methodology of your report here is based on the same principles that --

23     in pursuing the money trail, and of course I am aware that in Norway and

24     also through the European Community, you have enormity with structure,

25     both at the macro and micro level.  The Strasbourg Convention of 1990

Page 1610

 1     first; and second, the financial task force of resolutions, the first 40

 2     and then last 40 -- the last 9 after 11 September, et cetera, et cetera.

 3     Are both methodologies similar?

 4        A.   Yes, Your Honour.  It would be -- it will also be like trying to

 5     follow the money trail.  But, again, it will -- the limitation is that

 6     the -- you can only analyse the documents that you have in hand.

 7             JUDGE DAVID:  Thank you very much.  That's all.

 8             JUDGE MOLOTO:  Thank you.

 9             Any questions arising from the Judges?  I beg your pardon.

10     Judge?  Any questions arising from questions by the Bench?

11             MR. SAXON:  No, thank you.

12             JUDGE MOLOTO:  Mr. Lukic?  Thank you very much.

13             Mr. Torkildsen, thank you very much.  This brings us to the end

14     of your testimony here.  May I thank you for coming to testify, and may

15     you travel well back home.  Thank you so much.  You are now excused.  You

16     may stand down.

17             THE WITNESS:  Thank you, Your Honours.

18             JUDGE MOLOTO:  Thank you.

19                           [The witness withdrew]

20             JUDGE MOLOTO:  Yes, Mr. Saxon.

21             MR. SAXON:  First, may Ms. McKenna be excused so she can bid

22     farewell to the Mr. Torkildsen.

23             JUDGE MOLOTO:  She is excused.

24             MR. SAXON:  Your Honour, at this time the Prosecution would

25     tender for admission Mr. Torkildsen's expert report.  The Prosecution, as

Page 1611

 1     it said before, will not rely on the third sentence of paragraph 19,

 2     paragraph 23, nor paragraphs 79 to 83.

 3             MR. LUKIC: [Interpretation] Your Honours, on behalf of the

 4     Defence of Mr. Perisic, I object to having the expert report of

 5     Mr. Torkildsen admitted into evidence.

 6             Firstly, I tried to follow what you said in your ruling when you

 7     said that Mr. Torkildsen would come in for testimony and examination -

 8     that was your ruling of the 30th of October this year - as to what the

 9     expert should assist in, should be of assistance to us and especially to

10     you.  And that is, as layman, in certain matters that he is an expert, he

11     should assist us to find our way more easily in the exhibits and the

12     material and thus make the proper decision, and that you should make the

13     proper decision -- actually, that was my attempt at paraphrasing what the

14     Trial Chamber said it expects of an expert witness.  And I think that the

15     Prosecution and Mr. Torkildsen, with their findings, have not provided an

16     answer to what you were expecting.

17             And there are a number of reasons why I consider that this expert

18     report is in no way suited to the trial we are engaged in here.

19             First of all, I would like to say in respect of his CV the

20     following:  On the basis of what I saw and what he confirmed, I see that

21     he is -- well, I don't want to use any pejorative terms, but I think that

22     it is a classic police inspector, a professional police inspector, that

23     is investigating a case.  He has not written any work.  He did not deal

24     with any theoretical aspects of macro-economic relations or anything like

25     that.  On the other hand, he is a real investigator and he's highly

Page 1612

 1     professionally qualified in that respect.

 2             But what he was asked to do here, that is to say, the analysis of

 3     certain documents, and you were able to see from his testimony and

 4     examination-in-chief and the cross-examination what documents he used and

 5     what documents he didn't use, and the cross-examination what documents he

 6     used and what documents he didn't use.  And of the documents he didn't

 7     use, he considers to be important and significant in order to be able to

 8     answer the question that looms before us.  That's as far as his

 9     methodology goes.

10             So I consider that in the case of Mr. Torkildsen, that in the

11     true sense of the word, he's a summary witness; that is to say, a man who

12     came here before us and collected certain documents which are just

13     one-sided, in my opinion.  They did not provide an answer to the key

14     questions which were raised, which we might have been able to get from

15     expert witnesses of this type had we had other documents.

16             And I think that the results of his methodological approach are

17     that we had a witness as a summary witness who just introduced certain

18     documents that are important but did not provide a professional opinion.

19     Nothing further and more than what we as lawyers can see for ourselves in

20     these documents.  And as a lawyer myself, I don't consider that I'm well

21     educated in the economics sphere, but I think it was easy for me to

22     establish what was crucial for us here, the crucial points that we did

23     not receive from this witness; that is to say, we did not receive the

24     right answers to what we wanted to elucidate.  He said that something was

25     logical but, in fact, didn't provide us with answers, the answers to our

Page 1613

 1     questions.  And I think that he would be the right witness for quite a

 2     different area.

 3             But what we're interested in, first and foremost, and where we

 4     need key answers to key questions to be able to understand the

 5     Prosecution case, we did not get those from this witness.  We did receive

 6     a number of answers to the period from 1991 to 1992 and sometimes 1993,

 7     and you said in your decision that this is important in order to

 8     understand the genesis of financial relationships, but we did not, in

 9     fact, get what was important to us in this trial.

10             So I think that the documents that were tendered through this

11     witness speak for themselves, and that in that sense his expert report

12     cannot help us.  It cannot be of assistance.  As I can see, his answers

13     and his analysis of certain documents can best be seen in his responses

14     on Thursday to certain questions posed to him by the Prosecutor, his

15     analysis of P321, 319 and 322.  He just said what he read in the document

16     and all he could tell the Prosecutor was when the document came into

17     being.  But he gave no expert assistance to us for us to be able to

18     analyse and weigh up the situation and the questions that we're

19     interested in.  And that is why I don't feel that his expert report can

20     be admitted.

21             JUDGE MOLOTO:  Mr. Saxon.

22             MR. SAXON:  Your Honour, the Trial Chamber itself has already

23     found this report relevant in its decision of 30 October 2008.

24             With regard to Mr. Torkildsen's expertise, Mr. Torkildsen has

25     been a forensic financial investigator for more than 15 years.  You heard

Page 1614

 1     in his testimony he's carried out complex investigations nationally in

 2     Norway and internationally.  Clearly, he is much more than a police

 3     inspector investigating a typical case.  Clearly, he is much more than a

 4     summary witness.  Without Mr. Morten's -- Mr. Torkildsen's expertise,

 5     neither the Chamber nor, I submit, the other parties present in this

 6     room, would be able to understand the exhibits shown to him during the

 7     last two days of testimony and understood their relevance and probative

 8     value to issues that are important to this case.

 9             Mr. Lukic says that Mr. Torkildsen's evidence is one-sided.

10     Well, I would respectfully direct the Chamber to paragraph 55 of his

11     expert report where Mr. Torkildsen talks about the subject of "grey

12     issues," that is money, printed money, that was used for the budget of

13     the Republika Srpska or the Republic of Srpska Krajina that did not come

14     from the National Bank of Yugoslavia.  So you see in paragraph 55 one

15     example of the objectivity of Mr. Torkildsen.

16             It may be that Mr. Torkildsen was unable to review certain

17     documents related to the financing of these two Serb-controlled entities

18     during 1994 and 1995.  Having said that, the Chamber has heard and

19     received important, albeit not conclusive, evidence regarding the

20     financing of the VRS and the RSK during 1994 and 1995.  Exhibit P317, I

21     believe, is the document where a member of the RSK is complaining or

22     worrying that neither the RSK nor the VRS will receive sufficient

23     financing from the FRY during 1994.  You've also admitted into evidence a

24     number of requests made during 1994 and 1995 to the authorities in the

25     Federal Republic of Yugoslavia by either members of the VRS or the RSK or

Page 1615

 1     government officials of the Republika Srpska or the Republic of Serbian

 2     Krajina.

 3             Finally, Your Honour, this particular report and the evidence

 4     contained in it is important for another reason, and that is, this is an

 5     issue that has been taken up not only by the Prosecution but also by the

 6     Defence.

 7             If you take a look at paragraph 3 of the Defence pre-trial brief,

 8     there's a reference to a recent decision by the International Court of

 9     Justice in a lawsuit brought by Bosnia and Herzegovina against the

10     Republic of Serbia, and the last sentence of that paragraph says:

11             "The Defence has attached Annex A to this brief which outlines

12     those portions of the ICJ decision it believes should be followed by this

13     Chamber."

14             If you then turn to the factual findings relied upon by the

15     Defence and listed in Annex A, fact number 5 reads:

16             "There is no doubt that the FRY was providing substantial support

17     inter alia financial support to the Republika Srpska and that one of the

18     forms that support took was payment of salaries and other benefits to

19     some officers of the VRS, but this did not automatically make them organs

20     of the FRY."

21             So, Your Honours, even the Defence have highlighted the

22     importance of this kind of evidence.  And by reviewing the report and by

23     observing the demeanour of Mr. Torkildsen, listening to the expertise as

24     he's provided to you, the Prosecution has demonstrated this evidence is

25     both relative -- relevant, I'm sorry, and probative and therefore

Page 1616

 1     admissible.

 2             JUDGE MOLOTO:  Yes, Mr. Lukic.

 3             MR. LUKIC: [Interpretation] To make my position quite clear, I do

 4     not think at all that this topic is irrelevant for this trial.  I think

 5     this subject of financial support is exceptionally important and

 6     significant for establishing the facts before this Trial Chamber, and the

 7     documents introduced through Mr. Torkildsen I consider to be highly

 8     relevant.  However, precisely what Mr. Saxon just said, this just goes to

 9     confirm my position that he was here describing documents to us, which we

10     consider to be significant indeed, but he did not give an expert

11     professional opinion in matters which we are -- in the realm in which we

12     are unable to understand the documents, because as lawyers, and the Trial

13     Chamber especially which will come to weigh up the probative value of

14     exhibits.  In reading these documents, they could have gained a complete

15     picture.  But his report doesn't help us in that respect at all.  It is

16     not of assistance.

17             In his responses and answers today and on Thursday, on several

18     occasions when asked significant questions, he based his answers on

19     speculation, assumption, and logics.  So we can't accept that because

20     economics reports are very exact.  It's an exact science.  And they show

21     substantive and even mathematical relationships, and we can't expect an

22     expert to give us -- it would not be expected of an expert to give

23     answers on the basis of logic, speculation, and so forth.

24             So I think, based on your decision as the Trial Chamber that you

25     accept the witness coming in here and hearing him, is important for our

Page 1617

 1     trial, but his expert report cannot be of assistance to us in any way.

 2             Just one more sentence.  I stand by what I said at the beginning

 3     with respect to his professionalism and expert qualities that he -- look

 4     at his biography, his CV, before he did his report and, as I say, he was

 5     engaged in investigation, corruption, bribery, and so on and so forth, as

 6     a police inspector.  Not more than that.  Thank you.

 7                           [Trial Chamber confers]

 8             JUDGE MOLOTO:  The expert report of Mr. Morten Torkildsen is

 9     admitted into evidence.  May it please be given an exhibit number.

10             THE REGISTRAR:  Your Honours, the expert report, it will be

11     Exhibit P310.

12             JUDGE MOLOTO:  Thank you so much.

13             I'm mindful of the time.  There is an exhibit that was marked for

14     identification during this witness's testimony which we need to decide

15     upon.  We can do so now, but if there is going to be lots of arguments,

16     we can do that at the next session, and that's P314, MFI.

17             MR. SAXON:  Your Honour, if I understood you correctly when this

18     document was being discussed, your final ruling was that the P314 would

19     stay MFIed until and unless the Prosecution -- the Prosecution could

20     produce a final decision -- a final published decision indicating that

21     this proposal had been formally approved.

22             JUDGE MOLOTO:  So do you want us to stay at that point?  We'll

23     stay on that.

24             MR. SAXON:  Yes, Your Honour.

25             JUDGE MOLOTO:  Okay.  Thank you very much.

Page 1618

 1             Once again, it is late.  Other housekeeping matters, we'll deal

 2     with at the next session.

 3             We'll adjourn to tomorrow.  We start in the morning tomorrow,

 4     again in Courtroom I, 9.00.  Court adjourned.

 5                           --- Whereupon the hearing adjourned at 7.02 p.m.,

 6                           to be reconvened on Tuesday, the 18th day of

 7                           November, 2008, at 9.00 a.m.