10 The EU and Montenegro
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(28748)
11152/07
COM(07) 350
(b)
(28765)
11153/07
+ ADD1
COM(07) 351
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Draft Council and Commission Decision on the conclusion and signing of the Stabilisation and Association Agreement between the European Communities and its Member States and the Republic of Montenegro on behalf of the European Community
Draft Council Decision concerning the signing and conclusion of the Interim Agreement on trade and trade-related matters between the European Community and the Republic of Montenegro
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| Legal base | Article 133 EC; unanimity
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| Document originated | 21 June 2007
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| Deposited in Parliament | (a) 5 July 2007
(b) 6 July 2007
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| Department | Foreign and Commonwealth Office
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| Basis of consideration | EM of 13 July 2007
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| Previous Committee Report | None; but see (26575) 8884/05: HC34-i (2005-06), para 48 (4 July 2005)
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| To be discussed in Council | 15-16 October 2007 General Affairs and External Relations Council
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| Committee's assessment | Politically important
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| Committee's decision | Cleared
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Background
10.1 After several years of violent conflict in the Balkans, the
EU Regional Approach sought to underpin the implementation of
the Dayton/Paris and Erdut[35]
agreements and bring basic stability and prosperity to the region.
This was based on:
- a recognition that the main motivator for the establishment
of a dependable rule of law, democratic and stable institutions
and a free economy is a relationship with the EU based on a credible
prospect of membership, once the relevant conditions have been
met (which prospect was offered explicitly at the Feira European
Council in June 2000);
- the need for the countries to establish bilateral
relationships between themselves which would encourage greater
economic and political development; and
- the need for a flexible approach which, although
anchored to a common set of political and economic conditions,
allows each country to move ahead at its own pace.
10.2 Stabilisation and Association Agreements
(SAA) represent both the cornerstone of the Stabilisation
and Association process (SAp) and a key step to its completion.
The conclusion of an SAA represents the signatories' commitment
to complete, over a transitional period, a formal association
with the EU. It has a high political value. It is based on the
gradual implementation of a free trade area and on reforms designed
to achieve the adoption of EU standards, with the aim of moving
closer to the EU. The EU's strategy relies on the contract it
enters into with individual countries being fulfilled satisfactorily.
Careful preparation is thus a vital component of the SAp.
10.3 In July 2005 we considered, and cleared, a Commission
Communication which assessed the progress of what was then Serbia
and Montenegro (SaM) in meeting the SAp political and economic
criteria and in developing the capacity to negotiate meaningfully
and subsequently implement an SAA successfully. It concluded that
SaM was ready to proceed to this next stage, and therefore recommended
the opening of negotiations, with a view to subsequently presenting
a draft mandate to the Council. But it noted that progress, both
before and during negotiations, would depend not only on further
economic and other reforms but also, and importantly, on continued,
and ultimately full, cooperation with the International Criminal
Tribunal for the Former Yugoslavia (ICTY); should the Commission
note at any time that the State Union and republican authorities
of SaM had not lived up to their commitments and had not satisfactorily
addressed the issues highlighted in this Communication, it would
propose to the Council that the negotiations be suspended.[36]
The Council decided on 3 October 2005 to authorise the Commission
to begin these negotiations, which started on 10 October 2005.
10.4 In June 2006, following a referendum the previous
month, Montenegro declared independence and withdrew from the
State Union of Serbia and Montenegro. Immediately thereafter,
Montenegro was assessed to be fully cooperating with the ICTY.[37]
New Negotiating Directives for Montenegro were adopted on 24 July
2006 and negotiations resumed on 25 September 2006.
The Council Decisions
10.5 The proposals constitute the legal instruments
for the signature and the conclusion of the Stabilisation and
Association Agreement between the European Communities and their
Member States and the Republic of Montenegro. The Commission explains
that negotiations were concluded on 1 December 2006 and, after
consultations with the Member States, the SAA was initialled in
Podgorica on 15 March 2007. It focuses on the following main elements:
— provision
for political dialogue with Montenegro;
— provisions on enhanced regional cooperation,
including the perspective of establishing free-trade areas between
the countries of the region;
— the perspective of the establishment
of a free-trade area between the Community and Montenegro within
five years of the entry into force of the Agreement;
— provisions on the movement of workers,
freedom of establishment, supply of services, current payments
and movement of capital;
— the commitment by Montenegro to approximate
its legislation to that of the EC, notably in key areas of the
internal market;
— provisions on cooperation with Montenegro
in a wide range of fields, including justice, freedom and security;
and
— provision for the establishment of a
Stabilisation and Association Council which supervises the implementation
of the Agreement, of a Stabilisation and Association Committee
and a Stabilisation and Association Parliamentary Committee.
10.6 The Commission is now asking the Council to
give its final approval to the text of the SAA, which it says
was undertaken in close consultation with the Special Committee
created for this purpose (known as COWEB), and "to engage
the procedures for the signature and conclusion of this Agreement"
on the basis of the two proposals.
10.7 The Commission notes that ratification by all
Member States is a prerequisite for the entry into force of the
Agreement.
10.8 In his 13 July 2007 Explanatory Memorandum,
the Minister for Europe at the Foreign and Commonwealth Office
(Mr Jim Murphy) says that the Commission is hoping that it will
be possible to hope to sign the SAA at the 15-16 October GAERC
and is proposing that, in parallel, an Interim Agreement be signed
at the same time, to allow the Community competence elements,
e.g. trade liberalisation, to come into force immediately, as
they do not require parliamentary ratification.
The Government's view
10.9 The Minister describes the SAA as "a key
step on the path to EU membership [which] will establish a far-reaching
contractual relationship between the EU and Montenegro, entailing
mutual rights and obligations". It will ensure not only "the
gradual implementation of a free trade area" but also "reforms
designed to achieve the adoption of EU standards in areas such
as justice, freedom and security". He recalls that "our
strategic goal for the Western Balkans region is to move it towards
EU and NATO membership", which he sees "as the long-term
answer to the instability that dogged the Balkans in the 1990s,
and the best way to embed democracy and development in the region".
10.10 He says that regular dialogue and monitoring
missions to Podgorica have enabled the Commission to be satisfied
that Montenegro has made sufficient progress to conclude negotiations
on the text of the Stabilisation and Association Agreement and
to recommend its adoption. He also notes that the text of the
Agreement has been written in close consultation with the COWEB,
which is made up of all Member States; and that "neither
signature of the Stabilisation and Association Agreement nor the
text itself is politically controversial", with "other
Government Departments, notably the Home Office, DEFRA, DTI and
HMT" having been "involved throughout the process".
10.11 He also notes that, following signature, the
Agreement will need to be ratified by all 27 Member States:
"This process will maintain the pressure on
Montenegro to continue to implement the necessary reforms, as
it will have to persuade all Member States and their Parliaments
that progress is forthcoming. During the period between signature
and ratification, the Commission will monitor Montenegro's progress
through the European Partnership and annual progress reports."
10.12 On the Financial Implications, the Minister
notes that from 2007, the Instrument for Pre-Accession (IPA) will
deliver EU assistance to Turkey, Croatia, Albania, Bosnia and
Herzegovina, Kosovo, Macedonia, Montenegro and Serbia, with IPA
assistance for the Western Balkans seeking "to support economic
and social development and assist in implementing the necessary
reforms to move closer towards EU integration". The UK is,
he explains, liable for 17.5% of the IPA budget — approximately
€17 million of the €97.3 million which the IPA will
deliver to Montenegro between 2007-09.
Conclusion
10.13 We note that we will be able to monitor
progress during the EU-wide ratification process, which we understand
could take between 12 and 24 months, when the Commission reports
referred to above are deposited for scrutiny.
10.14 In the meantime, we have no questions for
the Minister and are reporting this welcome development because
of both its inherent importance and as a prelude to the further
consideration by the House to which it will be subject during
ratification.
10.15 We now clear the documents.
35 Signed in Erdut, Croatia and in Zagreb, Croatia,
in 12 November 1995. Back
36
See headnote. Back
37
The Commission suspended talks with Serbia in May 2006 because
of Serbia's poor cooperation with the ICTY. Following the formation
of a new government in May 2007, the Serbian authorities have
established a National Security Council headed by the President
to coordinate the work of the security services, and are judged
to have played a key role in the recent arrest of two ICTY indictees
(Vlastimir Djordjevic and Zdravko Tolimir). Against this background
the European Commission re-started Serbia's SAA negotiations on
13 June 2007, with full cooperation remaining the test for SAA
conclusion. Back
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