Christian Schmidt, the top international envoy to Bosnia suspends law that would have enabled the country's Serbs to take over the state-owned property on their territory and further weaken the central government.
The top international official in Bosnia has suspended a Bosnian Serb property law that is seen as part of a separatist drive by the Bosnian Serbs.
Christian Schmidt, who heads the UN Office of High Representative in Bosnia, said on Tuesday that the law passed in February in the Bosnian Serb assembly was unconstitutional.
"I have issued an order suspending the application of the Republika Srpska law on immovable property," top envoy Christian Schmidt told reporters.
"Only the state of Bosnia and Herzegovina can dispose of state property, or regulate the ownership of state property," the German diplomat added.
Bosnian Serbs have refused to withdraw the law and top Serb politician Milorad Dodik said on Tuesday he does not accept Schmidt's decision.
The legislation seeks to transfer ownership of the public property to the Serb-run entity called Republika Srpska, rather than the Bosnian federal state.
Bosnia's government consists of two entities — one run by Bosnian Serbs and the other by Bosniaks and Croats — established in a US-brokered peace agreement that ended the 1992-95 ethnic war.
The two semi-autonomous regions are bound together by joint central institutions.
READ MORE: Political situation in Bosnia and Herzegovina 'more worrying than ever'
Calling for separation
Dodik, a pro-Russia politician who's a Serb member of Bosnia's multi-ethnic presidency, has repeatedly called for the separation of the Serb entity from the rest of Bosnia.
Britain slapped Dodik and Bosnian Serb President Zeljka Cvijanovic with sanctions on Monday for undermining peace in the Balkan nation. Dodik already faced US sanctions earlier this year.
He remained defiant on Tuesday, saying that "the property of Republika Srpska remains the property of Republika Srpska."
Schmidt said that his decision "makes it clear that only the state of Bosnia and Herzegovina can dispose of state property or regulate property."
The Dayton peace accord envisages that joint decisions in Bosnia are reached by consensus of its ethnic groups. The UN High Representative has the authority to suspend laws and officials viewed as violating the peace deal.
The issue of ownership and division of the state property has remained unsolved for years amid disagreements between Bosnian politicians.
Bosnia's war killed more than 100,000 people and left millions homeless.
READ MORE: Is the EU assisting in the ‘break up’ of Bosnia?