"INA was surprised to read the statement made by HANFA on August 11th.

"First and most of all, INA refuses the implied criminal or misdemeanor threat against its President of the Management Board. Neither the President of the Management Board nor INA itself has ever questioned in any form the independence or the authority of HANFA. Nevertheless, we clearly maintain our right to form opinion about the (professional) activity of HANFA related to INA. This is clearly provided for and granted by both in the Constitution and the laws of the Republic of Croatia. An opinion, let it be a negative one, does not entitle anybody to threaten a company or its responsible manager(s).

"We fully co-operated with HANFA during the on-site investigation and reasonable efforts are being made to comply with HANFA’s decision," INA said in the statement.

On August 11, HANFA dismissed statements by INA Management Board chair Zoltan Aldott about the scope of activities of this Croatian regulator and its performance which he made in his interview with the Hungarian HVG business magazine.

HANFA stressed it could not accept Aldott's comments concerning the scope of Agency's activities.

"The Agency finds referring to its activities in such manner, implying that the Agency does not provide equal treatment to all the issuers in the Republic Croatia, as well as stating that the Agency has gone beyond its authorities during the procedure of supervision of issuer INA-Industrija Nafte d.d., malicious and unfair, and aimed at diminishing the Agency's reputation," the agency said in a statement published on it web site.

In addition, these claims show that Mr. Aldott is not familiar with the basics of the regulatory framework regulating the capital market in the Republic of Croatia and the Agency’s authority, the agency said.

Speaking of the findings of HANFA's investigation into an acquisition of INA shares by MOL, Aldott said in the interview that at the end of the 25-day investigation, certain obligations were imposed, such as the need to amend corporate rules on the handling of privileged information.

"We are now discussing a solution despite the fact that INA's standards of disclosure are already the same as those of any central or western European company. After the suspension (by HANFA) of trading in INA shares (on the Zagreb Stock Exchange), the company published two quarterly reports, containing equally good results. It makes no sense that those who wanted to buy or sell INA shares based on those reports, were forced, due to the suspension of trading by HANFA, to trade in shares in a nontransparent manner, via online advertisements. Such things compromise the seriousness of the entire Croatian capital market," said Aldott.

He noted that HANFA was not applying the same criteria to all Croatian companies, considering that it was not concerned about the fact that the Dioki petrochemicals producer had been unable or unwilling to pay the purchase price of ethane and natural gas supplied by INA for years.