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Europaudvalget 2004-05 (1. samling)
Det Europæiske Råd 4-5/11-04 Bilag 7
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COUNCIL OF

THE EUROPEAN UNION

Brussels, 8 October 2004

(OR.fr)

13243/04

LIMITE

ELARG 153

COVER NOTE

from:

date of receipt:

to:

Subject:

Secretary-General of the European Commission,

signed by Ms Patricia BUGNOT, Director

8 October 2004

Mr Javier SOLANA, Secretary-General/High Representative

COMMUNICATION FROM THE COMMISSION

TO THE COUNCIL AND TO THE EUROPEAN PARLIAMENT

Strategy Paper of the European Commission on progress in the enlargement

process

Delegations will find attached Commission document COM(2004) 657 final.

________________________

Encl.: COM(2004) 657 final

13243/04

DG E I

mip/CY/mm

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COMMISSION OF THE EUROPEAN COMMUNITIES

Brussels, 6.10.2004

COM(2004) 657 final

COMMUNICATION FROM THE COMMISSION

TO THE COUNCIL AND TO THE EUROPEAN PARLIAMENT

Strategy Paper of the European Commission on progress in the enlargement process

{SEC(2004) 1199, 1200}

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COMMUNICATION FROM THE COMMISSION

TO THE COUNCIL AND TO THE EUROPEAN PARLIAMENT

Strategy Paper of the European Commission on progress in the enlargement process

NTRODUCTION

The enlargement of the EU to ten new Member States on 1 May 2004 has further

strengthened the unity of the European continent. The historical and political arguments in

favour of this enlargement are compelling: it enhances peace, prosperity, stability and security

and has also produced substantial economic benefits.

Bulgaria and Romania are an integral part of this enlargement process which was launched in

1997. Both countries are close to completing the negotiations. The EU’s objective is to

welcome both countries in January 2007 as members, if they are ready.

The Commission’s assessment in this year’s Regular Reports confirms that the Union’s pre-

accession strategy with Bulgaria ad Romania has been a success. The transformation process

in both countries has been accelerated by the prospect of enlargement. The Commission will

make every effort in order to meet the European Council’s objective to bring the negotiations

with Bulgaria and Romania to a successful conclusion in 2004, on the basis of own merits,

with a view to signing the Accession Treaty as early as possible in 2005.

The European Council in June 2004 concluded that accession negotiations with Croatia shall

begin in early 2005. The Commission sets out below suggestions for a framework for these

negotiations building on the experiences from the current enlargement process. It also

presents the content of a pre-accession strategy for Croatia including financial instruments.

In line with the European Council conclusions of December 2002, the Commission assesses

in a separate document whether Turkey fulfils the Copenhagen political criteria and whether

accession negotiations should be opened.

All Western Balkans countries have a perspective

to become candidate countries. Already, the former Yugoslav Republic of Macedonia has

applied for membership, and upon Council’s request, the Commission is preparing an Opinion

on that application.

2.1.

ULGARIA AND

OMANIA

Progress in meeting the membership criteria

In the Regular Reports, progress made by Bulgaria and Romania towards meeting the

membership criteria is assessed, in terms of legislation and measures actually adopted or

implemented.

Recommendation of the European Commission on Turkey’s progress towards accession, COM(2004)

656.

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This year’s Regular Reports’ assess Bulgaria and Romania’s ability to assume all obligations

of membership by accession. They evaluate progress made over the last year and also look at

progress achieved by each country since the 1997 Opinions and their track record in

implementing the commitments made in the negotiations.

Bulgaria and Romania continue to fulfil the Copenhagen political criteria. Improvements need

to be made in particular in the reform of their public administration, the functioning of their

judicial system, and the fight against corruption.

Bulgaria and Romania fulfil the criterion of being a functioning market economy. The

continuation of Bulgaria’s reform path and the vigorous implementation of Romania’s

structural reform programme should enable them to cope with competitive pressure and

market forces within the Union

Bulgaria and Romania have continued to make good progress in adopting the

acquis

and have

generally fulfilled their commitments made in the negotiations. They are on track to complete

the required legislative transposition by accession provided that the current pace of progress is

maintained. They need to continue their efforts to develop sufficient administrative and

judicial capacity to implement and enforce the

acquis.

The conclusions of the Regular Reports on Bulgaria and Romania can be found in Annex 1.

The Regular Reports point to a number of areas where further improvements need to be made

in the context of the political and economic criteria and in relation to the adoption,

implementation and enforcement of the

acquis.

These should be vigorously pursued in order

to remedy before accession the shortcomings identified.

2.2.

Completing the accession process

The

accession negotiations

are well advanced. A framework to finance the accession of

Bulgaria and Romania was defined in spring 2004. This allowed the provisional closure of all

chapters with Bulgaria in June 2004. For Romania, three chapters remain to be negotiated

(competition, environment, and justice and home affairs) as well as parts of Chapter 31

(Other). Additional efforts are needed in particular in the competition chapter as regards state

aid and in the justice and home affairs chapter as regards judicial co-operation, fight against

corruption and organised crime, border management.

In line with the practice followed in previous enlargements, it will not be possible to go

beyond a certain point in time when considering new

acquis

in the negotiations. In view of the

very advanced state of the negotiations and the prospect of signing the Accession Treaty as

early as possible in 2005, the Commission considers that the negotiations should cover all

acquis

adopted and published by 1 October 2004. Bulgaria and Romania should therefore

transmit their positions on all new

acquis

adopted until that date. This would allow to deal

with any transitional arrangements before the end of the negotiations.

The results of the accession negotiations in terms of agreed transitional arrangements and the

technical adaptations to the

acquis

as a result of enlargement will be embodied in an

Accession Treaty.

Work on the drafting of this Treaty started in July 2004.

Once the text of the Treaty has been agreed by all parties, in accordance with Article 49 of the

EU Treaty, the Commission will issue its Opinion. The European Parliament will be asked to

give its assent, followed by a decision of the Council on the admission of Bulgaria and

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Romania. The objective is to sign the Accession Treaty as early as possible in 2005 in order

for it to enter into force on 1 January 2007. After the signature, the Treaty will be submitted

for ratification by the present and future Member States.

The Commission considers that the decision making procedures concerning requests from

Bulgaria or Romania for transitional arrangements on acts of the institutions adopted between

1 October 2004 and the date of accession should be streamlined to ensure a smooth transition

from pre- to post-accession decision making. In addition, active observer status in the

Council, in committees presided over by the Commission as well as in other institutions as

appropriate would be granted as from the signature of the Treaty.

The Commission is closely

monitoring

how Bulgaria and Romania are meeting their

commitments made in the negotiations. It is highly important that these commitments are

implemented as foreseen. The Commission will therefore continue its intensive monitoring

after the conclusion of the negotiations.

Building on the analysis in Regular Reports, the Commission will monitor progress by

making intensive use of the Association Agreements structures, and all other monitoring

instruments including peer reviews. As from November 2005, the Commission will issue

yearly comprehensive monitoring reports, covering all

acquis

chapters, public administration,

judiciary and fight against corruption as well as the track record in economic reforms.

Any delays or problems in economic reform or in the fulfilment of commitments will be

signalled by the Commission, in particular through early warning letters at a political level

and reported to the Council on the basis of current procedures. For cases of serious

shortcomings, the Accession treaty will contain three

safeguard

clauses as a last resort

mechanism (general economic, internal market and justice and home affairs).

Moreover, as the period between the end of the negotiations and Bulgaria and Romania’s

expected date of accession is likely to be long, and given the large number of commitments

that still need to be fulfilled, the Commission considers that the Accession Treaty should as a

precautionary measure contain a specific safeguard. This safeguard, already agreed in the

negotiations with Bulgaria, should be extended to Romania as well. It would allow the

Commission to recommend to the Council at any time before the entry into force of the

Accession Treaty to postpone the envisaged date of accession of Bulgaria or Romania by one

year to January 2008 if there is clear evidence that there is a serious risk that Bulgaria or

Romania will be manifestly unprepared to meet the requirements of membership by 1 January

2007 in a number of important areas.

Up until accession, the Union will continue to help Bulgaria and Romania in their

preparations for membership through the

pre-accession strategy.

This includes significant

financial assistance to support both countries in taking the remaining steps necessary to fully

meet the accession criteria.

2.3.

After joining the Union

The process of considerably reinforcing administrative and judicial capacity will need to

continue after Bulgaria and Romania join the Union. Therefore the Commission proposes to

make available a special transition facility for institution building. In this context, certain

Community financed instruments which have proven their usefulness, such as twinning, will

continue to be used.

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In accordance with the EU Treaty, Bulgaria and Romania will not immediately adopt the euro

upon accession. Similarly, as regards the application of the Schengen

acquis,

the lifting of

internal border controls will only occur some time after accession and will be decided for each

new Member State separately once they fulfil the Schengen

acquis.

Bulgaria and Romania will need to apply to join the European Economic Area (EEA) and

their accession to the EEA should take place at the same time as their accession to the EU.

Other international agreements will have to be adjusted as a result of enlargement as soon as

the Accession Treaty is signed.

2.4.

Conclusions

This year’s Regular Reports show that Bulgaria and Romania have made further progress in

implementing the Copenhagen criteria. Bulgaria and Romania fulfil the political criteria.

Bearing in mind the progress achieved by both countries, the track record in implementing

their commitments, and taking into account their preparatory work in progress, the

Commission expects these countries to fulfil the economic and

acquis

criteria and to be ready

for membership by 1 January 2007.

The Commission will make every effort in order to meet the European Council’s objective to

bring the negotiations with Bulgaria and Romania to a successful conclusion in 2004, on the

basis of own merits, with a view to signing the Accession Treaty as early as possible in 2005.

3.1.

ROATIA

Pre-accession strategy

The Brussels European Council in June 2004 concluded that Croatia is a candidate country

with which accession negotiations will start in early 2005 and requested the Commission to

prepare a pre-accession strategy for Croatia. The Commission considers that the reinforced

pre-accession strategy for candidate countries decided by the European Council in

Luxembourg in December 1997 should be extended to Croatia. The elements of this strategy

are outlined below.

The review procedure aimed at assessing candidate countries’ progress towards membership

will start to be applied to Croatia as of 2005. This will mean that the Commission will start

issuing Regular Reports on Croatia as from autumn 2005. In the context of the Stabilisation

and Association Process, the Commission has already proposed a European Partnership, based

on the findings of its Opinion on Croatia’s application for membership. This document will

guide Croatia’s accession preparations.

Croatia as a candidate country should benefit from all three pre-accession financial

instruments: Phare for institution-building and economic and social cohesion, ISPA for

environment and transport, and SAPARD for rural development. The Commission will

propose amendments to the regulations for these three pre-accession instruments in order to

extend their scope to Croatia as of 1 January 2005. Taking into account the needs for an

adequate preparation of Croatia for accession, the Commission recommends that €105 million

(€80 million for Phare and €25 million for ISPA) are allocated to Croatia in 2005 and €140

million in 2006 (€80 million for Phare, €35 million for ISPA, and €25 million for SAPARD).

These amounts will be financed out of the pre-accession funds available under heading 7 of

the current financial perspectives. The Commission has proposed to Council to create a new

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pre-accession instrument (IPA), from which Croatia would benefit from 2007 onwards,

building on the present pre-accession instruments Phare, ISPA and SAPARD. The amounts to

be allocated to Croatia from 2007 onwards will be decided in the context of the next financial

perspective.

The Stabilisation and Association Agreement (SAA) signed with Croatia in October 2001 has

now been ratified. In order to implement the trade-related aspects of the SAA, an Interim

Agreement entered into force in March 2002. A Stabilisation and Association Council,

Committee and Sub-Committees will be set up. The Commission proposes that the structures

of the SAA be used not only to cover issues related to the implementation of the agreement,

but also to serve as forums for the explanation of the

acquis

and review progress made by

Croatia in the alignment of the

acquis

in line with commitments taken in the negotiations.

The framework agreement allowing Croatia’s participation in Community programmes and

agencies should come into force in the first half of 2005, after ratification by the EU

institutions and Croatia. Croatia’s financial contribution to each programme can be partly

funded by Phare.

In addition to the above mentioned elements for a reinforced pre-accession strategy, the

Commission considers that an enhanced political dialogue with Croatia should continue in

order to tackle the issues highlighted in the Opinion. Such issues include the relations with the

International Criminal Tribunal for the former Yugoslavia, minority rights, return of refugees,

judiciary reform, regional co-operation and the fight against corruption. In particular, Croatia

needs to remain committed to regional cooperation within the framework of the Stabilisation

and Association Process for the Western Balkans. The Commission will closely monitor these

issues in regular meetings with the Croatian authorities and will keep the Council informed.

3.2.

The negotiating framework

The Brussels European Council in June 2004 decided that “in advance of negotiations with

Croatia, the Council will agree a general negotiating framework, taking full account of the

experience of the fifth enlargement process”. The Commission suggests that the framework

should build on the following principles:



The negotiations with Croatia should be guided by the conditions for accession as defined

at the Copenhagen European Council in 1993. These conditions are adequate tools for

measuring a candidate country’s preparedness for meeting the obligations of membership,

and provide for clear guidance in the reform process.



Progress in the negotiations will be fully dependent on the sustainability of political

reforms and Croatia’s fulfilment of its obligations in respect of regional cooperation with

the other countries of former Yugoslavia and other related international obligations such as

cooperation with ICTY.



In line with the Treaty on European Union and the Constitution for Europe, the

Commission will recommend the suspension of negotiations in the case of a serious and

persistent breach of the principles of liberty, democracy, respect for human rights and

fundamental freedoms and the rule of law on which the Union is founded. The Council

should be able to decide on such recommendation by a qualified majority of Member

States.

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

The negotiations will be conducted on the principle of own merits. Any transitional

arrangements should be limited in scope and time and not have significant impact on

competition or the functioning of the internal market.



Immediately after the formal opening of the accession negotiations with Croatia, the

Commission will organise a formal process of examination of the acquis, called screening,

in order to explain it to the Croatian authorities and to obtain preliminary indications of the

issues that will most likely come up in the negotiations.



Once a chapter has been screened, the Commission will, building on its recent Opinion on

Croatia, recommend opening it for negotiations provided Croatia is sufficiently prepared.



Croatia’s correct transposition and implementation of the acquis including effective and

efficient application through appropriate administrative and judicial structures will

determine the pace of negotiations.



The Commission will propose to the Council benchmarks for each chapter’s provisional

closure ahead of the opening of negotiations under that chapter. These benchmarks could

refer to legislative alignment or to a satisfactory track record in implementation. This

approach has proved to be successful notably in the competition chapter.



Progress in the negotiations will be dependent on Croatia’s fulfilment of its commitments

under the Stabilisation and Association Agreement, in particular those that mirror

requirements under the acquis for example in the field of competition. Any such

commitment needs to be fully met before a chapter can be provisionally closed.



The Commission will carefully monitor Croatia’s progress towards accession making use

of all available instruments.

ONCLUSIONS AND RECOMMENDATIONS

In the light of the above, the Commission’s conclusions and recommendations are the

following:

(1)

This year’s Regular Reports show that Bulgaria and Romania have made further

progress over the last year in implementing the accession criteria.

Bulgaria and Romania fulfil the political criteria. Bearing in mind the progress

achieved by these countries, the track record in implementing their commitments, and

taking into account their preparatory work in progress, the Commission expects these

countries to fulfil the economic and

acquis

criteria and to be ready for membership by

January 2007.

The Commission will make every effort in order to meet the European Council’s

objective to bring the negotiations with Bulgaria and Romania to a successful

conclusion in 2004, on the basis of own merits, with a view to signing the Accession

Treaty as early as possible in 2005.

(2)

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(3)

The Regular Reports point to a number of areas where further improvements need to

be made in the context of the political and economic criteria and in relationship to the

adoption, implementation and enforcement of the

acquis.

These should be vigorously

pursued in order to remedy before accession the shortcomings identified. In order to

analyse progress and to facilitate successful membership of the European Union, the

Commission will conduct an enhanced monitoring and regularly report to the Council.

The Commission will issue as from November 2005 yearly comprehensive monitoring

reports for the Council and the Parliament. The Commission considers that a specific

safeguard needs to be introduced in the Accession Treaty which would allow the

Commission to recommend to the Council to postpone the date of accession of either

Bulgaria or Romania by one year to January 2008 if there is clear evidence that there

is a serious risk that Bulgaria or Romania will be manifestly unprepared to meet the

requirements of membership by 1 January 2007 in a number of important areas.

The Commission recommends extending to Croatia the reinforced pre-accession

strategy for candidate countries decided by the European Council in Luxembourg in

December 1997, as outlined above.

The Commission recalls that the European Council has decided to begin negotiations

with Croatia early in 2005 and suggests that the negotiating framework for Croatia,

building on the principles outlined in this paper, is finalised to that end.

(4)

(5)

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NNEX

: C

ONCLUSIONS OF THE

EGULAR

EPORTS ON

ULGARIA AND

OMANIA

Bulgaria

Since the Commission concluded in its 1997 Opinion that Bulgaria fulfilled the political

criteria, the country has further consolidated and deepened the stability of its institutions

guaranteeing democracy, the rule of law, human rights and respect for and protection of

minorities. This trend has been confirmed over the past year. Bulgaria continues to fulfil the

political criteria.

Tangible progress was made in public administration reform with the adoption of

amendments to the Civil service law. The specific structures for co-ordinating European

integration continue to function well, and in view of Bulgaria’s aim of building a qualified

and efficient civil service by the time of accession this progress needs to spread throughout

the public administration. Also, interdepartmental coordination should improve. Attention

should be given to the legal framework for local and regional administration, which will play

an important role in the implementation of the

acquis.

Building on important reforms of the judiciary system achieved in recent years, there have

been positive developments with regard to the recruitment and appointment of judges. Still,

certain key parts of the reform of the judiciary remain to be adopted. The complexity and

efficiency of the penal structures, in particular in the pre-trial phase, is a matter of concern.

Strong efforts will be necessary to foster Bulgaria’s capacity to prosecute organised crime and

corruption, which involves further reforms in the structures of the judiciary and of the police.

Bulgaria has implemented several measures in the fight against corruption, but it remains a

problem. Renewed efforts are needed, including tackling high level corruption.

Bulgaria continues to respect human rights and fundamental freedoms. Further progress

should be pursued in specific areas to improve their implementation in practice.

Comprehensive legislation on anti-discrimination was adopted but the independent body

required by the law has not yet been established. The freedom of expression is ensured by

law. However, the legal framework regarding libel and defamation by journalists needs to be

revised. Efforts to address inadequate living conditions in certain prisons and problems of ill-

treatment in custody need to be sustained. Trafficking in human beings is a serious problem

and needs to be addressed. A new law on public health should address most of the issues

related to the placement of mentally disabled people. The structures responsible for child

welfare and their co-ordination with the relevant ministries need to be reinforced.

Efforts have been made in the past years to develop a framework to tackle the problems faced

by minorities, but the situation on the ground has not evolved much. Sustained efforts

including allocation of appropriate financial resources will be necessary to effectively

implement the intentions and to combat in particular anti-Roma prejudice.

The 1997 Opinion already acknowledged the substantial reform efforts undertaken by the

Bulgarian authorities to transform their economy. Since the Opinion economic structure and

performance have significantly improved. Macroeconomic stability has been achieved soon

after the Opinion, profound economic reforms have been carried out over the entire period

while the Bulgarian authorities’ commitment to the economic requirements of EU accession

has been sustained.

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Hence, it is concluded that Bulgaria is a functioning market economy. The continuation of its

current reform path should enable Bulgaria to cope with competitive pressure and market

forces within the Union.

Improvements can be made in sustaining macroeconomic stability and in deepening structural

reforms. The current account deficit has widened substantially in 2003 and could, if

continuing, warrant a further policy response. The business environment, in particular the

efficiency of the administrative and judicial system as well as regulatory procedures, should

be further improved to increase Bulgaria’s attractiveness for investment. In spite of significant

achievements, privatisation still needs to be completed. While the legal framework is largely

in place, the actual restructuring and liberalisation of the network industries need to progress

further in order to enhance competition and efficiency. The ongoing reduction in

unemployment should be further supported by reducing rigidities in labour market regulation.

Since the Opinion, Bulgaria has made good progress in adopting the

acquis

and more

recently, has also made progress in gradually building up the administrative capacity to

implement and effectively enforce the

acquis.

Over the past year, Bulgaria has made further progress in the vast majority of the chapters of

the

acquis

and is on track to complete the required legislative transposition before the planned

date of accession if the current pace of progress is maintained.

Overall, Bulgaria has now achieved a reasonable degree of alignment with the

acquis

in the

large majority of areas. It is also on track in developing adequate administrative capacity to

implement the

acquis

in a considerable number of fields. Bulgaria has established most of the

necessary institutional structures. Nevertheless, in some sectors, further efforts and resources

are required to strengthen the capacities of these institutions and to ensure their effective

functioning. In order to cover the remaining gaps, due attention should be given to the full and

timely implementation of the strategies and action plans for the reinforcement of

administrative capacity already approved in these areas.

In the field of internal market, Bulgaria has continued to make progress in most areas as

regards the

free movement of goods

in terms of transposition of the

acquis

and the

development of the administrative capacity. However, further efforts are required to develop

the administrative capacity to implement the

acquis

on industrial products and as regards

foodstuff and food safety. Mutual recognition clauses are still to be introduced into the

Bulgarian legislation falling under the non-harmonised areas. Alignment of the legislation on

public procurement needs to be completed. As regards

free movement of persons,

some

progress was made in the field of mutual recognition of professional qualifications but work is

still needed on the framework legislation for mutual recognition and with regard to the future

co-ordination of social security systems. As regard the right for establishment and the

freedom

to provide services,

efforts are required to unequivocally eliminate the remaining restrictions

and discriminatory measures on foreigners despite some corrective actions. As regard

financial services, major parts of the

acquis

on insurance remain to be transposed. In the area

free movement of capital,

Bulgaria still has to adopt legislation on capital movements and

payment systems. Efforts to improve the framework in the fight against money laundering

should be maintained.

As regards

company law,

particular attention should be paid to the effective enforcement of

industrial and intellectual property rights, in particular through strengthening border controls

and improving co-ordination between the law enforcement bodies. In the area of

competition,

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Bulgarian has further updated its legislative framework and further strengthened its

administrative capacity. Sustained efforts are required in order to continue to improve the

quality of its State aid enforcement.

Regarding

agriculture,

Bulgaria has continued to make good progress in the transposition

process. Further strengthening of administrative structures has been noted. However,

significant work is still needed in the veterinary field and in the setting up of the paying

agency and IACS. With regard to

fisheries,

legal alignment has taken place according to

schedule. However, further progress has to be made regarding the administrative and

technical capacity for inspection and control.

As regard

transport,

Bulgaria has made steady progress in transposing the

acquis

in most

sectors, however administrative capacity should be further strengthened. Further efforts are

needed to align the inland waterway legislation. Particular attention should be devoted to

improving the maritime safety record and to the building up and reinforcement of the

necessary capacities and structures for Port State and Flag State control.

In the area of

taxation,

Bulgaria’s indirect legislation is to a significant extent aligned with the

acquis,

notably as far as VAT is concerned. Further transposition is required as regards excise

duties and direct taxation. Efforts should continue as concerns specifically interconnectivity

with EU systems.

social policy and employment,

progress has continued in alignment with the

acquis.

Further efforts for the effective implementation of the transposed legislation need to be

undertaken in particular in the areas of labour law, occupational safety and health, public

health, anti-discrimination as well as equal opportunities for women and men. Administrative

capacity needs to be strengthened,

inter alia

with regard to ESF management and

implementation.

Regarding

energy,

Bulgaria is making good progress in its legislative alignment and in its

preparation to the internal energy market. The restructuring and privatisation of the energy

sector is progressing well but particular efforts are still needed to improve energy efficiency

and the use of renewable energy. Bulgaria must continue to respect its commitments on

nuclear safety, notably as regards closure commitments for certain units of the Kozloduy

nuclear power plant, and to ensure a high level of nuclear safety in its installations.

Although a reasonable degree of alignment with

acquis

in the

telecommunications

has been

reached, Bulgaria needs to adopt further implementing legislation and ensure that the

regulatory body is strengthened.

Concerning

regional policy and co-ordination of structural instruments,

Bulgaria has made

progress notably with regard to establishing the legal framework and designating institutional

structures. However, considerable efforts are still needed to improve the administrative

capacity in key Ministries and improving the capacity of other relevant bodies, such as the

intermediate bodies, and other relevant players both at central and regional level. Priority

must also be given to the setting up of efficient and integrated monitoring and evaluation

systems as well as to further improving the financial management and control systems.

Attention must be paid to observance of an ambitious planning schedule for the National

Development Plan and to the full involvement of relevant partner organisations in this

process.

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With regard to the

environment,

Bulgaria has achieved a reasonable degree of alignment with

the

acquis

and the necessary administrative structures are in place. However, further

strengthening of the enforcement authorities notably at regional and local level is required as

well as the provision of adequate financial resources for State and private sector investment.

In the area of

consumer and health protection,

a reasonable degree of alignment with the

acquis

has been reached in the area of safety related measures. However, further alignment is

particularly needed with regard to the non-safety related measures and Bulgaria should ensure

that the administrative structures in place can effectively enforce legislation and carry out

market surveillance activities.

In the area of

justice and home affairs,

further good progress could be noted as regards the

management of the future external borders. However, significant further efforts are needed to

strengthen the law enforcement capacity and policy formulation in order to step up the fight

against organised crime and corruption. Bulgaria needs to press ahead and dedicate adequate

resources to fundamental reforms of the police and of the judiciary, including the reform of

the pre-trial phase and the implementation of the strategies against crime. Overall, the full and

timely implementation of the main strategies and action plans in the area of justice and home

affairs, together with the entry into force of the planned amendments to the legislation on the

penal procedure, legal aid, asylum, mediation and forfeiture of criminal assets should address

the bulk of the issues covered in this chapter.

Regarding

customs,

Bulgaria has achieved a high degree of legislative alignment and has

improved its administrative capacity. Efforts should continue in the IT area as well as to

further improve revenue-collection and controls.

Further progress has been made in strengthening

financial control

in Bulgaria. More effort is

needed to ensure the protection of the EC financial interests and of the euro against

counterfeiting, as to well as to further strengthening the administrative capacity to implement

sound financial control systems.

Overall, the capacity of the law enforcement and regulatory bodies to ensure a level playing

field within the internal market through effective implementation and enforcement of the

acquis

must be enhanced. The continued reinforcement of the judicial system and

administrative structures in certain areas will require particular attention, notably as regards

public procurement, competition and justice and home affairs. Bulgaria should devote more

efforts and financial resources to make the necessary investments to apply the

acquis,

notably

in agriculture (in particular in the veterinary field), transport and environment. Continued

efforts are required to establish the necessary administrative capacity to ensure the sound and

efficient management of EU funds, notably the Structural Funds.

In the accession negotiations, all 31 chapters have been provisionally closed. The

commitments made in the negotiations are with a view to accession in 2007. Bulgaria is

generally meeting the commitments that it has made during the negotiations although delays

have been noted in specific areas.

Bearing in mind the progress achieved since the Opinion, the level of alignment and

administrative capacity that Bulgaria has achieved at this point in time and its track record in

implementing the commitments that it has made in the negotiations, and taking into account

their preparatory work in progress, the Commission expects Bulgaria to assume the

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obligations of membership in accordance with the envisaged timeframe. In the period leading

up to accession, Bulgaria needs to continue its preparations, in line with the commitments it

has made in the accession negotiations.

Romania

Since the Commission concluded in its 1997 Opinion that Romania fulfilled the political

criteria, the country has further consolidated and deepened the stability of its institutions

guaranteeing democracy, the rule of law, human rights and respect for and protection of

minorities. This trend has accelerated over the past year. Romania continues to fulfil the

political criteria.

Progress was made to address the need for administrative and judicial reforms. A public

administration reform strategy was launched in May 2004, covering the area of civil service

reform, decentralisation and deconcentration, and policy co-ordination. A positive start was

made to the reform of the civil service. The establishment of the Chancellery of the Prime

Minister should help to improve policy coordination and consistency. The use of emergency

ordinances was restricted to “extraordinary circumstances”, but this has not yet led to a

decrease of their use. The laws on the freedom of information and transparency in the

legislative process should still be fully implemented. The revision of the Constitution in

October 2003 contributed to streamlining the parliamentary process by giving both chambers

primary responsibility for different types of legislation. Efforts to improve the policy-making

and legislative process should continue. Further efforts are also needed to strengthen local and

regional governance with a view to ensuring proper implementation of the

acquis

at those

levels.

The management of court cases and the quality of judgments needs to improve. Official

surveys confirm the possibility for the executive to influence the outcome of judicial

proceedings. However, organisational and legislative changes introduced in Romania’s

judicial system should help to make it more independent and efficient. Their implementation

on the ground is a matter of priority.

Corruption in Romania continues to be serious and widespread. Romania’s anti-corruption

legislation is generally well developed, but its ability to curb corruption will depend on the

effective implementation of the law. In particular, additional efforts are required to ensure the

independence, effectiveness and accountability of the National Anti-Corruption Prosecution

Office. It should concentrate its resources on investigating high-level corruption.

Romania continues to respect human rights and fundamental freedoms and has made further

progress in several areas. The introduction of national standards for child protection services

and of strict rules on inter-country adoption, which appear to be in line with the UN

Convention on the rights of the child, should further improve the protection of children’s

rights. As regards freedom of expression, the legal situation of journalists has improved but

the economic situation of many mass media organisations remains precarious and further

efforts are necessary to guarantee media independence. Although the restitution of

agricultural land is almost completed, a more speedy and transparent approach is needed to

further the restitution of buildings and religious property. Efforts to address the problems of

ill-treatment in custody, trafficking in human beings and prison overcrowding should be

sustained.

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The Roma Strategy, which is explicitly aimed at addressing discrimination, is being

implemented but de facto discrimination against the Roma minority remains widespread. The

support for an inclusive approach to education is a positive development. The same

encouraging trend has been noted in health care and employment.

The 1997 Opinion already acknowledged the substantial reform efforts undertaken by the

Romanian authorities to transform their economy. Since the Opinion economic structure and

performance have significantly improved. Macroeconomic stability has been achieved,

profound economic reforms have been carried out while the Romanian authorities’

commitment to the economic requirements of EU accession has been sustained.

Hence, it is concluded that Romania complies with the criterion of being a functioning market

economy. Vigorous implementation of its structural reform programme should enable

Romania to cope with competitive pressure and market forces within the Union.

Improvements can be made in sustaining macroeconomic stability and in deepening structural

reforms. Priority should be given to preserve the momentum in disinflation and safeguard the

sustainability of the external position by maintaining a prudent policy mix and by further

reducing the deficit of the broader public sector. To achieve this, significant improvements in

enforcing financial discipline, continuous adjustments of energy prices towards cost recovery

levels and improved financial performance of public enterprises are vital. Fiscal sustainability

needs to be strengthened by advancing expenditure reform and further improving tax

compliance. The privatisation process should be accomplished, post-privatisation disputes be

settled and non-viable enterprises more actively dismantled. In key sectors, such as energy,

mining and transport, perseverance in restructuring and a more manifest strive for

privatisation should go hand in hand. Substantial progress in the functioning of the judiciary

and the public administration, including an even and predictable application of law, is

required to create an enabling business environment with a level playing field.

Since the opinion, Romania has made good progress in adopting the

acquis

and more

recently, has also made progress in gradually building up the administrative capacity to

implement and effectively enforce the

acquis.

Over the past year, Romania has made further progress in the vast majority of the chapters of

the

acquis

and is on track to complete the required legislative transposition before the planned

date of accession if the current pace of progress is maintained.

Overall, alignment with the

acquis

has reached a fair level in the large majority of areas. The

administrative capacity has been strengthened in the majority of areas but there is still room

for improvement since not all the necessary institutions are yet in place. In order to cover the

remaining gaps, due attention should be given to the full and timely implementation of the

strategies and action plans for the reinforcement of administrative capacity already approved

in these areas.

In the area of

internal market,

Romania has continued to make progress with the transposition

of legislation in the field of the

free movement of goods.

However, transposition of the public

procurement legislation must be completed. In addition, practices which put Romania’s

commitment to open and transparent procurement procedures into question should be

discontinued. Legislation has been further aligned in the area of

free movement of persons,

particular as regards mutual recognition of professional qualifications and free movement of

workers. Alignment needs to be completed as regards citizens’ rights and administrative and

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training capacities should be enhanced in general. In particular in the field of financial

services, Romania achieved substantial progress in

freedom to provide services.

Romania

should continue to pay attention to the removal of identified barriers against the right of

establishment and the freedom to provide services and to the development of the insurance

and financial securities markets. While alignment with the

acquis

free movement of capital

has further improved, outstanding restrictions to capital movements and payments should be

removed and the enforcement record of the National Office for the Prevention and Control of

Money Laundering needs to be improved.

Romania has continued to make progress in transposing the

company law acquis

as such and

the

acquis

concerning the protection of intellectual and industrial property rights. However,

the level of enforcement of such rights has not kept pace with this. Romania’s legislative

alignment on accounting and auditing should be completed. While the Romanian

competition

legislation is broadly in line with EC anti-trust rules, current proposals needed to complete

alignment of the state aid legislation are being prepared. The enforcement record of the

Romanian competition authority still needs to be considerably improved in state aid matters.

Recent efforts in this respect need to be stepped up. Romania needs to ensure that

restructuring aid given to steel companies is in line with the Europe Agreement.

Romania made significant progress to further transpose the

agricultural,

veterinary and

phytosanitary

acquis

and has strengthened its administrative capacity. However, overall

administrative and enforcement capacities should be further enhanced. Particular attention

should be paid to reinforcing the SAPARD Agency and to establishing the necessary elements

of a functioning IACS. Upgrading plans for non-complaint establishments in the veterinary

sector should be introduced with no delay. Steady progress has taken place in the

fisheries

sector in terms of alignment and administrative capacity. However, sustained efforts are

needed to recruit sufficient staff in the Fisheries Inspectorate and provide it with adequate

inspection tools. The fishing database should be established.

Romania has continued to make progress with the transposition of the

transport acquis

and

building up the administrative structures in the areas of road, rail and aviation transport.

Alignment is fairly advanced in the maritime sector. The technical state of the inland

waterway fleet should be improved.

Romania has made some progress in aligning with the

acquis

taxation

and particular

attention should now be paid to completing alignment and strengthening administrative

capacity. Transposition of the

acquis

social policy and employment

has continued. Future

efforts should focus on completing legislative alignment in the area of labour law and on

strengthening the Labour Inspectorate to ensure proper implementation in the area of health

and safety at work. Due attention should be paid to the promotion of social dialogue and to

the improvement of the health status of the population, which is well below the EU average.

Administrative capacity with regards to ESF management should be strengthened as a matter

of priority. Legislative progress in the

energy

sector should be matched by full

implementation and increased administrative capacity, in particular with regard to the internal

energy market structures. The restructuring of energy markets process needs to be completed.

Romania has performed steady progress as far as

industrial policy

is concerned, but the key

challenge is its implementation as structural weaknesses limit the capacity for enforcement.

Transparency of the privatisation process should be fully ensured. Progress has continued in

the area of

telecommunications

with liberalising the telecommunications market and

completing the transposition of the

acquis.

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As regards

regional policy and co-ordination of structural instruments,

progress has been

made in preparing for the implementation of structural policies with the designation of the

Managing and Paying Authorities and establishing their tasks and adoption of the 2004-2006

National Development Plan. Efforts need to be continued to bring the administrative capacity

up to the level required in order for Romania to reap full benefits of the structural instruments.

Environment

is an area where Romania has achieved a good level of alignment with the

acquis

in most of the sectors, whereas implementation is, in general, still lagging behind.

Further transposition should concentrate on completing the alignment in the areas of

horizontal legislation, air quality, waste management, water quality, nature protection and a

number of other sectors. Implementation of the transposed

acquis

remains a key challenge

and, therefore, requires enhanced efforts. It is of utmost importance that the environmental

administration at all levels obtains sufficient resources in order to cope with the increasing

recruitment, training and equipment needs. Strategic planning, adequate investment and

financing plans also have to remain in the focus of the public services in the field of

environment.

Legislative alignment on

consumer and health protection

is well on track and Romania has

made good progress as regards improvement of administrative capacity and the general co-

ordination of market surveillance activities. These efforts should be maintained and consumer

movement should be strengthened.

Legislative progress has been made in many areas of

justice and home affairs

and especially

so in migration, asylum and judicial co-operation in civil and criminal matters. However,

implementation capacity should be significantly strengthened in almost all areas, as should

inter-agency co-operation. Many agencies and institutions involved in law enforcement are

still affected by staff shortages, which will also require enhanced training capacity. The

independence of the judiciary must be ensured on the ground. As regards the fight against

corruption, implementation capacity should also be significantly strengthened and the existing

legislation should be rigorously enforced. Romania should implement its current plans to fully

address the above issues of concern and in particular increase its administrative capacity in

the relevant institutions, implement an effective reform of the judicial system, recruits and

train the necessary staff and take measures that have a significant impact on corruption.

Limited progress has been made in the area of

customs

and legislative alignment should be

completed. Internal co-ordination improved. Furthermore, any customs duties and charges

having equivalent effect with regard to export and import to and from the Community will

have to be abolished. Romania has pursued its efforts in the

financial control

area. However,

the legislative framework should be completed in the area of external audit and protection of

the Communities’ financial interests. Administrative capacity should be strengthened to

implement sound financial system.

In a number of important sectors, the overall

capacity of the public administration

implement and enforce the newly adopted legislation should be enhanced. Romania has

started to address this issue through the comprehensive reform of its public administration.

These concerns extend beyond the adoption of the

acquis

and also apply to the management

of EU financial assistance. Furthermore, there are a number of areas where further efforts will

be needed to complete the work, in particular as regards company law, competition policy,

environment and justice and home affairs, customs and financial control.

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In the accession negotiations, 27 chapters have been provisionally closed. Romania is

generally meeting the commitments that it has made during the negotiations, although delays

have been noted in specific areas.

Bearing in mind the progress achieved since the Opinion, the level of alignment and

administrative capacity that Romania has achieved at this point in time and its track record in

implementing the commitments that it has made in the negotiations, and taking into account

their preparatory work in progress, the Commission expects Romania to assume the

obligations of membership in accordance with the envisaged timeframe. In the period leading

up to accession, Romania needs to continue its preparations, in line with the commitments it

has made in the accession negotiations.