The hearings come 13 years after Bosnia filed the lawsuit against Serbia-Montenegro — the successor state for the defunct Yugoslavia — charging it with a premeditated attempt to destroy Bosnia's Muslim population, in whole or in part.
The stakes potentially include billions of dollars and history's judgment.
Meanwhile, Spanish police said Monday they had arrested a key witness in the case against former Yugoslav President Slobodan Milosevic, who is on trial at The Hague on 66 war crimes counts, including genocide.
Veselin Vukotic, the alleged killer of former Yugoslav human rights leader Enver Hadri, was arrested at Madrid's airport over the weekend, police said.
Although individual Bosnian Serbs have been convicted on genocide charges, the U.N.'s highest court started hearing arguments on whether the Serbian state can be held responsible for the actions of its allies in the neighboring republic and its own leaders during Yugoslavia's brutal secessionist war in the early 1990s.
"This case is not aimed at individual citizens of Serbia and Montenegro," said Bosnian representative Sakib Softic, opening 10 days of arguments by his team. "This is about state responsibility, and seeks to establish responsibility of a state which, through its leadership, and through its organs, committed the most brutal violations of ... the most sacred instruments of international law."
Serbia must end its denial of history before relations can improve between the two states, Softic said.
The Bosnian lawsuit is one of the most complex and far-reaching rulings ever sought from the tribunal, also known as the world court. Arguments are scheduled to end May 9, and it likely will be a year before the judges deliver their verdict.
The case hinges on whether the court believes the Serbian state, and not just a group of individuals, had the specific intent to wipe out the Muslims of eastern Bosnia as a distinct community.
"Not since the end of the Second World War and the revelations of the horrors of Nazi Germany's 'Final Solution' has Europe witnessed the utter destruction of a people, for no other reason than they belong to a particular national ethnical, racial, and religious group as such," said the lawsuit's opening paragraph.
Much of Bosnia's argument draw on evidence heard at the International Criminal Tribunal for the former Yugoslavia, nearby in The Hague. That U.N. war crimes court already has ruled that genocide occurred in Bosnia and has convicted two Bosnian Serb army officers.
It has been trying former Milosevic for years, with the proceedings delayed many times by his health problems.
On Monday, Phon van den Biesen, a Dutch lawyer representing Bosnia, highlighted links between the government and army under Milosevic in Belgrade and the Bosnian Serbs who carried out the killing and expulsion of Muslims.
"Without Belgrade, the ethnic cleansing campaign could not have happened," he said.
If the judges rule in Bosnia's favor, they would decide later whether to award financial reparations, which could total billions of dollars. The court's rulings are binding, and a refusal to abide by them could be referred to the U.N. Security Council for action.
Croatia, another republic that splintered from the crumbling Yugoslav federation, has a similar genocide case against Serbia pending at the world court.
Bosnian survivors started a vigil Monday outside the neo-Gothic Peace Palace where the court sits in The Hague. Demonstrators carried a banner bearing the names of the more than 8,000 victims of the 1995 massacre at Srebrenica.
Bosnia filed the lawsuit in March 1993, less than a year after Yugoslav-backed Serb paramilitary forces began attacking Muslim villages adjacent to Serbia. The Bosnians claim the Serbs intended to drive out the residents and create a Greater Serbia.
In a horrific roster of atrocities, the lawsuit cites case after case of the slaughter of civilians, mass rape, the systematic destruction of mosques and cultural heritage sites, and the creation of "extermination camps."
Two years after the documents were filed in The Hague, Bosnian Serb forces commanded by Gen. Ratko Mladic massacred about 8,000 Muslims during one blood-soaked week in the U.N.-declared safe haven of Srebrenica.
The Yugoslav tribunal already has ruled that genocide occurred at Srebrenica.
Mladic remains at large, branded one of the world's most-wanted fugitives. He is believed to be hiding in Serbia with protection from hard-liners in the Serb military and police — loyalists of Milosevic.
Reports of Mladic's imminent capture circulated in recent days, but they proved false. Serbia-Montenegro faces a European Union deadline to surrender Mladic or have its membership talks with the bloc frozen. EU foreign ministers meetings in Brussels, Belgium, on Monday set a March 31 deadline for Belgrade to hand over Mladic.
The original deadline was Tuesday.
"Unless these countries like Serbia cooperate with the criminal tribunal in The Hague, and hand over indicted war criminals, they cannot expect the full cooperation from the European Union in return," British Foreign Secretary Jack Straw said.
Genocide was not specifically outlawed until the 1948 Genocide Convention, prompted by the Holocaust.
The first genocide conviction came 50 years later, when a special U.N. court on Rwanda sentenced a former mayor, Jean-Paul Akayesu, to life imprisonment for complicity in the deaths of thousands of Tutsis. The Rwanda court has handed down numerous convictions since then.