bne IntelliNews -

The Croatian Supreme Court has annulled another corruption conviction of former prime minister and head of the Croatian Democratic Union (HDZ), Ivo Sanader, and has set a HRK12.4mn (€1.6mn) bail for his release.

The decision on October 1, which comes two months after the Constitutional Court annulled two other corruption convictions against Sanader, will raise even more questions about the country’s judicial system. It could also influence the vote in the upcoming general elections, where polls show the ruling Social Democratic Party (SDP) is neck and neck with Sanader’s conservative HDZ. Although the HDZ has sought to distance itself from Sanader, its reputation was still tarnished by the scandals surrounding the former prime minister.

Sanader was sentenced in March 2014 to nine years in jail, after he was found guilty of masterminding a joint criminal enterprise that extracted more than HRK70mn from public companies. The money was used both to fund his lavish personal lifestyle and to provide illegal financial support to the HDZ. The funds were extracted via contracts with marketing firm Fimi-Media. The court confiscated Sanader's assets worth HRK15mn, while HDZ was fined HRK5 and assets worth HRK24mn were confiscated from the party.

Now the Supreme Court has ordered a retrial saying that procedural errors had breached Sanader’s right to a fair trial.

A retrial was also ordered in July, when the Constitutional Court annulled the verdicts in two other cases in which the former Prime Minister had received prison sentences for bribe taking. The court also cited procedural errors at that time.

Sanader was sentenced to eight and a half years in prison for accepting a €10mn bribe in the 2008-2009 period from the head of Hungarian energy group MOL, Zsolt Hernadi, to help MOL obtain a dominant position in Croatian oil and gas company INA. Also, between 1994 and 1995, when Sanader was deputy minister for foreign affairs, he was found to have received a commission of HRK 3.6mn (€475,000) from Austria's Hypo Alpe Adria bank. Now that the verdicts have been quashed, Sanader can be released after he pays the bail.

The court’s decision to annul the verdict might give HDZ a boost ahead of general elections expected later this year. The party is still leading in the polls, but support for the SDP has started to increase, helped by positive macroeconomic data and possibly by the government’s handling of the migrant crisis.

HDZ has tried to distance itself from its shady past under Sanader, which contributed to its crushing defeat in the 2011 election. However, the annulment of the conviction might bring unexpected support for the party. The party’s candidate, Kolinda Grabar Kitarovic, took the Croatian presidency in January despite the scandal.