The Serb member of Bosnia's joint presidency on Friday threatened the "dissolution" of the country, after the outgoing UN high representative used his discretionary powers to ban genocide denial.
The UN official in Bosnia holds some executive powers in the Balkan country that was the scene of the 1995 Srebrenica massacre, an event often downplayed by Serb leaders.
Austrian diplomat Valentin Inzko, whose main role as high representative is to oversee the Dayton peace agreement that ended the bloody 1990s inter-communal conflict, made the decision a week before handing over to German colleague Christian Schmidt.
Inzko added several amendments to the Bosnian Criminal Code, including providing penalties of between six months and five years in prison for those who "publicly approve, deny, grossly minimise or attempt to justify the crime of genocide, crime against humanity and war crime," according to a document on the website of the Office of the High Representative.
The amendments enter into force immediately.
"Lack of acknowledgement, accountability and redress for victims of mass atrocities and systematic abuses has devastating effects on society," Inzko said in a statement.
"All this prevents the building of a peaceful and prosperous future for Bosnia and Herzegovina," he added.
In July 1995, a few months before the end of the war that left about 100,000 dead, Serb forces rounded up and killed more than 8,000 Muslim men and boys after they captured the town of Srebrenica.
The massacre was deemed genocide by various verdicts of both the International Criminal Tribunal for Former Yugoslavia (ICTY) and the International Court of Justice (ICJ).
- 'Red line' -
Serb leaders in Bosnia and Serbia, however, usually deny the massacre amounted to genocide, instead calling it a "great crime."
The Serb member of Bosnia's tri-member presidency Milorad Dodik immediately slammed Inzko's move.
"After this, Bosnia cannot function... I think there is no other option for Republic of Srpska than to start a process of dissolution," Dodik said in a press conference.
"There is a red line... There was no genocide and this is the opinion of all of us," Dodik added.
Inzko's decision was hailed as "historic" by the leaders of Bosnia's Muslim-Croat entity.
Bakir Izetbegovic, leader of the main Bosnian party (SDA), congratulated Inzko "for having ended his term of office in Bosnia with dignity".
The families of genocide victims praised the "important" move by the high representative.
"We will be protected from insults, humiliations, as will be the verdicts," said Munira Subasic, head of the association Mothers of Srebrenica.
However, German political scientist and Balkan expert Bodo Weber believes that Inzko had taken a "personal" decision without having consulted the Western chancelleries.
"I absolutely understand Inzko and I support his objectives. But... I think it will end up being a deeply counterproductive move," Weber told regional N1 TV.
However, the European Union on Friday warned Bosnian Serb leaders against denying the massacre at Srebrenica as a genocide.
"Revisionism and the denial of genocides are in contradiction with the most fundamental European values," said Nabila Massrali, spokeswoman for EU foreign policy chief Josep Borrell.
"The EU urges all political leaders to refrain from resorting to inflammatory and divisive rhetoric and taking measures which could undermine the country's European perspective."