Aside from the 16,5 million EUR for the Jugoremedija shares, Nini was also obliged under the terms of the privatization agreement to invest in the reconstruction of the factory in order to obtain European GMP (good manufacturing practice) certification for the factory’s production lines. After finishing the investment, he would then be allowed to ‘recapitalize’ Jugoremedija in order to increase his share and become the enterprise’s majority shareholder. The Jugoremedija workers and the other small, ‘external’ shareholders weren’t informed about the second part of this contract – i.e. that the state had actually sold Stefanović not only the 42% of Jugoremedija that it held, but that it also wanted him to become majority owner without consulting the firm’s 4,500 remaining shareholders.

There’s nothing unusual in all this, however, since at this point in the process of Serbian privatization - only a year after the new law was adopted - there was no legal framework whatsoever that could provide protection for the rights of workers or small shareholders. For example, the Law on Free Access to Public Information was adopted only in November 2004, and its implementation started almost a full year after that. This means that in 2002 worker-shareholders had no legal avenues through which they could even obtain the contract regulating the sale of 42% of their own company.

Actually, it was through workers’ struggles in factories like Jugoremedija that the Serbian government was eventually forced to admit that workers and small-shareholders have some rights in the privatization process. However, back in 2002, any workers’ group that tried to dispute irregularities in the privatization process would have been crucified in the national media as ‘Stalinists,’ ‘enemies of transition,’ and so on…

After the state sold its 42% share, the Jugoremedija workers started organizing themselves and mobilizing the support of ‘external’ shareholders. During the company’s March 2003 Shareholders’ Assembly, Stefanović proposed his investment plan which sought investments in raw materials not crucial upgrades. He misled the assembled shareholders by arguing that this was part of his contract with the state. The representative of the workers and small shareholders at the assembly was Zdravko Deurić, who rejected Stefanović’s proposal. In retaliation, Stefanović suspended Deurić as well as union leader Vladimir Pecikoza.

As the situation deteriorated, Jugoremedija workers went on strike in December 2003, demanding that Stefanović stop mobbing (intimidating) union activists and those in the shareholders’ association. Stefanović agreed to their demands on January 6, but after the strike ended he hired private security guards who only subsequently intensified the intimidation tactics against workers. In the meantime, Stefanović produced a forgery of the Shareholder Assembly’s original decision on investment and presented himself at Zrenjanin’s Economic Court as Jugoremedija’s ‘64%’ majority-owner.

After accidentally learning about this (Deurić was in Court attending to some other business when he saw that the ownership structure was being changed), the workers reacted with another strike in early March 2004. After they learnt of the actual content of the contract between the state and Stefanović – i.e. stipulating the need to invest in upgrades for GMP certification – the workers turned their strike into a protest. They now demanded that the state terminate its contract with Stefanović, because he didn't fulfill his obligations under its terms.

On March 15, Serbia’s Ministry of Economy concluded that Stefanović hadn’t fulfilled his investment obligations. A group of about 100 Jugoremedija workers converged on Belgrade and blocked the Privatization Agency’s premises for a day, demanding that the state file legal proceedings to terminate its contract with Stefanović. The PA did so the next day. On 3 April 2004 Stefanović’s management left the factory.

Following negotiations organized at the beginning of August 2004 by then Minister of Economy Predrag Bubalo, the workers agreed to let Stefanović’s management return to the factory and to work with them until the courts could determine which side was the majority owner. Stefanović’s CEO Aleksandar Radovanović also agreed that the private security force that caused the March incidents wouldn’t be hired again and that Jugoremedija workers will provide their own security. However, on August 16, about 120 members of Stefanović's private security force came into the factory and started a fight with the workers. The police arrived to separate the two-sides but ignored worker-shareholder demands that the private security force must leave since they hadn’t been authorized by the management to be on the premises of the Jugoremedija factory.

After a few days, on August 19, Stefanović's private army provoked another fight and the Zrenjanin police used it as an excuse to conclude that they no longer have control over the situation. Serbia’s then Minister of Interior, Dragan Jočić, sent special police units from Belgrade (the so called „Gendarmerie“), commanded by the police general Milivoje Markov, to stabilize the situation.

Markov immediately called Deurić and three more strike leaders for talks at the police station. Upon their arrival at the station they were told that they were being arrested. After separating the strikers from their leadership in this way, Markov ordered that his unit kick the remaining workers out of Jugoremedija. Deurić and the other three strike-leaders spent the next 10 days in solitary confinement, while the police initiated criminal proceedings against them for ‘causing a public danger.’ The very next day Stefanović began firing workers. In next few months 150 of them got fired for different reasons.

Over the next two and a half years, this group of 150 worker-shareholders, now without jobs, struggled – with the support of Jugoremedija’s other small-shareholders, local unions and left activist groups and intellectuals from Serbia and abroad - through direct action and within the courts to prove that Stefanović had broken his contract with the state. In the summer of 2006, Noam Chomsky and Naomi Klein were among the many intellectuals and activists from around the world who addressed Serbian President Boris Tadić and Prime-Minister Vojislav Koštunica with letters of support for the Jugoremedija workers.

We won in the end, and on 1 March 2007 Jugoremedija became the only factory in Serbia operated by worker-shareholders! After the court canceled the state’s contract with Stefanović, all small-shareholders (both ‘internal’ and ‘external’ shareholders), voted for the workers to establish their own management in the factory. Zdravko Deurić is now serving as the CEO of Jugoremedija.

Realizing that he was going to loose this battle, Stefanović tried to halt production in November 2006, hoping to bankrupt Jugoremedija in order to take it over later as a majority creditor. After March 2007, the state attempted several times to declare Jugoremedija bankrupt because of the tax-related debt incurred under Stefanović’s management.  However, the workers quickly succeeded in reorganizing the company’s production lines and to pay the whole debt owed to the state within only a few months.

Another big challenge was the reconciliation process between the workers who were fired, and those who stayed to work for Stefanović – especially with those who supported him in public during the struggle. Even though there were several incidents between these groups in March and April 2007, both the workers’ new management and the union took a stand that no act of revenge on strikebreakers would be tolerated. They also decided that former strikebreakers could no longer count on the privileges they were granted under Stefanović at the expense of their striking co-workers.

During the Shareholders’ Assembly in September 2007, the workers’ management proposed their own investment plan to Jugoremedija’s shareholders – this time, the hope was not to seek a ‘solution’ to the problem of GMP certification by looking for an outside investor, but to do so through Jugoremedija's own revenues. The EUR 15 million investment plan was supported by the Assembly. The state, now again in possession of 42% of the shares, abstained from voting. After the Shareholders’ Assembly vote, Serbia’s Ministry of the Economy decided not to try selling its share of Jugoremedija before the reconstruction of the factory was completed.

According to workers' plans, the reconstruction is to be completed by August 2009.

Reflecting on the outcome of their victory, it is important to note that this particular model of workers’ control unfortunately can't technically be applied to most workplaces under Serbia’s current legal order regulating privatization. Nonetheless, Jugoremedija has become a symbol for workers struggles throughout Serbia, because it has shown that solidarity, as well as persistent and clever ACTIVISM can triumph over powerful enemies like Jovica Stefanović and the state administration.

The current struggle by Jugoremedija workers to reconstruct and develop their factory shows how RESPONSIBILITY for property can provide peace and understanding between people with such opposing standpoints as workers and shareholders, or even strikers and strikebreakers.

It sounds like an opportunity for a country that has only recently emerged from the bloodiest war in Europe after WW2.

Inspired and helped by the workers of Jugoremedija, other workers in Zrenjanin have since radicalized their own struggles as well. The most distinguished example being the struggle waged by the workers of the Šinvoz train factory. However, the Šinvoz case also shows that the Government and the bosses in Serbia have learnt valuable lessons from the Jugoremedija experience. In 2007, a new strategy targeting workers’ unions and small-shareholders was launched – a strategy aimed at deliberately putting the company into bankruptcy.

Ivan Zlatić