The law, passed in a 42:3 vote on Tuesday, redefines the status and the management of the protected area, a 311-hectare Karst estate with a herd of the famous Lipizzaner white horses, and the estate's cultural heritage.

According to Eva Štravs Podlogar, a state secretary at the Economy Ministry, the law will contribute to highlighting the importance of the horses and the stud farm as a monument of national importance, and facilitate the exploitation of the economic potential of Lipica as a tourist destination.

It also aims to improve operating conditions and the potential for future development, she added.

Under the law, the Lipica Stud Farm Holding, a limited liability company, will manage the estate, which will remain in direct ownership of the state.

The holding will establish a public service subsidiary in which it will have to retain a 100% stake, and a for-profit subsidiary in which it will have to retain a majority stake.

MPs welcomed the effort to better protect the horse and agreed that the stud farm had potential to become a tourist gem. However, several groups opposed the planned organisation of the stud farm.

Independent MP Bojan Dobevšek said the bill did not specify what would happen with the holding's subsidiaries and who will manage the stud farm.

The opposition Left expressed doubt about the government's claims that the law would not lead to the privatisation of the stud farm.

While the opposition Democrats (SDS) and New Slovenia (NSi) did not oppose the bill, only expressing hope that the law would actually be implemented, the junior coalition Pensioners' Party (DeSUS) was divided.

According to the party's MP Tomaž Gantar, it is not certain that the law is the best solution ensuring continued development of the stud farm.

The senior coalition Modern Centre Party (SMC) and junior coalition Social Democrats (SD) backed the proposal, arguing that without suitable legislation there could be no breakthrough in the development of the stud farm.