By Zoran Radosavljevic
ZAGREB (Reuters) - A Croatian court ruled on Wednesday that a communist-era intelligence chief could be extradited to Germany where he is wanted over a killing of a Yugoslav dissident in the 1980s.
Josip Perkovic, who was in office when Croatia was part of communist federal Yugoslavia, was arrested on New Year's Day as the Balkan state acted to resolve an extradition dispute that had overshadowed its accession to the European Union last July.
The same day police also arrested a second ex-secret service chief, Zdravko Mustac, from the Yugoslav period. Mustac is also wanted by Germany for the same crime and another Zagreb court is to rule on his extradition on Thursday.
"The court decided to approve the extradition of Josip Perkovic to Germany, based on (a) European Arrest Warrant," said Ivana Calic, a Zagreb county court deputy spokeswoman.
Perkovic's lawyer said they would appeal to the Supreme Court, which must then rule within three days.
Perkovic worked for the Yugoslav federal secret service, the UDBA, helped set up Croatia's national intelligence agency as it seceded from Belgrade in 1991, when Yugoslavia broke up in bloodshed, and held senior security posts through the 1990s.
Germany wants him in connection with the 1983 murder of a Yugoslav dissident in Bavaria that it blamed on UDBA. He has denied wrongdoing and said he was ready to testify before a Croatian court.
Some legal experts have said Perkovic should not be extradited because the statute of limitations has passed for a murder committed more than 25 years ago.
He was one of 10 Croatians arrested on European arrest warrants as an amended extradition law took effect on January 1 to bring the country into line with most of the rest of the EU.
Shortly before joining the EU on July 1, Zagreb changed its laws to prevent the extradition of suspects in crimes committed before 2002, when new EU extradition rules took effect.
The government said at the time that it wanted to protect veterans of Croatia's 1991-95 independence war from facing potential prosecution elsewhere in the EU. It denied any connection with the Perkovic case and pointed out that some EU member states have the same 2002 time limit.
But the government removed the time restriction in August after the European Commission warned that it could face legal action, including the possible loss of EU development funds.
(Editing by Mark Heinrich)