EUROPEAN COMMISSION Strasbourg, 17.4.2018 SWD(2018) 151 final COMMISSION STAFF WORKING DOCUMENT Albania 2018 Report Accompanying the document Communication from the Commission to the European Parliament, the Council, the European Economic and Social Committee and the Committee of the Regions 2018 Communication on EU Enlargement Policy {COM(2018) 450 final}

{SWD(2018) 150 final}

{SWD(2018) 152 final}

{SWD(2018) 153 final}

{SWD(2018) 154 final}

{SWD(2018) 155 final}

{SWD(2018) 156 final}



Table of Contents 1. Introduction 1.1. Context 1.2. Progress on meeting the conditions for opening accession negotiations 1.3. Summary of the report 2. Fundamentals first: political criteria and rule of law chapters 2.1. Functioning of democratic institutions and public administration reform 2.1.1 Democracy 2.1.2. Public administration reform 2.2. Rule of law and fundamental rights 2.2.1. Chapter 23: Judiciary and fundamental rights 2.2.2. Chapter 24: Justice, freedom and security 3. Fundamentals first: Economic development & competitiveness 3.1. The existence of a functioning market economy 3.2. The capacity to cope with competitive pressure and market forces within the Union 4. Regional issues and international obligations 5. Ability to assume the obligations of membership 5.1. Chapter 1: Free movement of goods 5.2. Chapter 2: Free movement of workers

5.3. Chapter 3: Right of establishment and freedom to provide services 5.4. Chapter 4: Free movement of capital 5.5. Chapter 5: Public procurement 5.6. Chapter 6: Company law 5.7. Chapter 7: Intellectual property law 5.8. Chapter 8: Competition policy 5.9. Chapter 9: Financial services 5.10. Chapter 10: Information society and media 5.11. Chapter 11: Agriculture and rural development 5.12. Chapter 12: Food safety, veterinary and phytosanitary policy 5.13. Chapter 13: Fisheries 5.14. Chapter 14: Transport 5.15. Chapter 15: Energy 5.16. Chapter 16: Taxation 5.17. Chapter 17: Economic and monetary policy 5.18. Chapter 18: Statistics 5.19. Chapter 19: Social policy and employment 5.20. Chapter 20: Enterprise and industrial policy 5.21. Chapter 21: Trans-European networks 5.22. Chapter 22: Regional policy and coordination of structural instruments

5.25. Chapter 25: Science and research 5.26. Chapter 26: Education and culture 5.27. Chapter 27: Environment and climate change 5.28. Chapter 28: Consumer and health protection 5.29. Chapter 29: Customs union 5.30. Chapter 30: External relations 5.31. Chapter 31: Foreign, security and defence policy 5.32. Chapter 32: Financial control 5.33. Chapter 33: Financial and budgetary provisions Annex I – relations between the EU and Albania Annex II – Statistical annex



1. Introduction 1.1. Context Albania has continued to implement the Stabilisation and Association Agreement and the meetings of the joint bodies under the agreement took place. In November 2016 the Commission recommended the opening of accession negotiations subject to credible and tangible progress in the implementation of the justice reform, in particular the re-evaluation of judges and prosecutors (vetting). The Commission has continued to monitor thoroughly the developments in the context of the Five Key Priorities. 1.2. Progress on meeting the conditions for opening accession negotiations

Key Priority 1: Albania was requested to reform the public administration with a view to enhancing its professionalism and de-politicisation. The relevant legal and strategic frameworks are now in place. Implementation of public administration reform has continued consistently, following the adoption of the civil service legislation, advancing further towards a professional and merit-based civil service. The transparency and quality of merit-based recruitment and selection procedures for public posts were enhanced, particularly for the central level of governance; the capacity of the institutions responsible for management and monitoring of the civil service was strengthened; the operational infrastructure of service delivery was improved through one-stop-shops and further implementation of the territorial administrative reform (see section 2.1.2 Public administration reform). Key Priority 2: Albania was requested to take further action to reinforce the independence, efficiency and accountability of judicial institutions. A thorough and comprehensive justice reform is being implemented. It was launched with a set of amendments that changed to one third of the country's constitution. The main features of the ongoing reform can be summarised around the following pillars: measures to fight corruption, including by establishing a new Special Anti-Corruption and Organized Crime Structure (SPAK); measures to reduce the influence by the parliament and the executive on the judiciary; measures to increase the independence and effectiveness of the High Court, as well as the independence, impartiality and transparency of the Constitutional Court and the High Council of Justice and Prosecution system; measures to increase accountability of judges and prosecutors, including by setting up the new High Judicial Council, the new High Prosecutorial Council, as well as a High Justice Inspector; measures to increase justice efficiency and access to justice. Implementation of the various components of the reform is progressing well, in line with the legal provisions, in terms of steps and calendar. The work on the establishment of the new bodies for the self-government of the judiciary is also progressing. In addition to the institutional restructuring of the judiciary, the reform process foresaw the launch of a generalised re-evaluation (vetting) of all judges and prosecutors. This entails that around 800 professionals are currently undergoing scrutiny. The vetting has now started. The Albanian vetting institutions have completed the assessment of the top priority cases (i.e. all judges at the Constitutional Court, the President of the High Court and the Chief Prosecutor). The first hearings resulted in the dismissal of a Constitutional Court judge and of a Court of Appeal judge, also candidate to the High Judicial Council. Seventeen high ranking judges and prosecutors resigned (some at the very start of the process, refusing their assets to be verified, some asked to retire or leave service upon reaching the end of their mandates, and some just before the hearings, after receiving notification of the findings to be discussed in the hearing). Another hearing in early April resulted in the confirmation in duty of a Constitutional Court judge (see section 2.2.1 Chapter 23: Judicial and fundamental rights). Key Priority 3: Albania was requested to make further determined efforts in the fight against corruption, including towards establishing a solid track record of proactive investigations, prosecutions and convictions. In recent years, substantial work was done to improve the legal framework and the institutional set-up (including SPAK) to strengthen the system to prevent and fight corruption. As regards the efforts towards establishing a solid track record in the fight against corruption, the positive trend of recent years continued. There is an increase of activity at different points of the investigation chain. The police increased the number of referrals of corruption cases and the number of corruption cases sent to court also maintained an increasing trend in recent years. The overall number of first and second instance convictions involving junior or middle-ranking officials has constantly increased in recent years. Regarding convictions of high-level state officials, important results have been achieved in the judiciary. Convictions have been rendered against prosecutors and judges. As regards the opening of new cases against high-state officials, these also increased. However, the number of final convictions of high-state officials remains very low. The establishment of a solid track record of proactive investigations, prosecutions and convictions in the fight against corruption remains nonetheless a long-term objective that continues to require further structured and consistent efforts. The efforts noted since the Five Key Priority framework was established, seem nevertheless adequate to consolidate further progress in this area, which will remain a core aspect of EU engagement in the context of future negotiations (see section 2.2.1 Chapter 23: Judicial and fundamental rights). Key Priority 4: Albania was requested to make further determined efforts in the fight against organised crime, including towards establishing a solid track record of proactive investigations, prosecutions and convictions. Tangible results were achieved in particular in the fight against the cultivation and trafficking of cannabis. In 2017, a substantial reduction of cannabis cultivation and a considerable increase of seizures, in particular of stocks of cannabis, were detected. Large scale law enforcement operations also led to successful confiscation of large quantities of cannabis stockpiled from previous crops and, recently, also cocaine from Latin America and covered also trafficking of human beings and property rights abuses. Work continues on preparing for the vetting of police forces (law adopted in principle by the Assembly at the end of February). As regards the track record in the fight against criminal organisations and structured criminal groups, the number of referrals has increased in the past years, and has particularly intensified in the past months, but the number of indictments and final convictions remain very low and has only marginally increased. As regards statistics on serious crimes not linked to criminal organisations and structured criminal groups, the trend of people convicted is increasing, against the background of a higher number of reported cases. Such crimes are mostly related to production and cultivation of narcotics, followed by money laundering. The establishment of a solid track record of proactive investigations, prosecutions and convictions in the fight against organised crime remains nonetheless a long-term objective that continues to require further structured and consistent efforts. The efforts noted since the Five Key Priority framework was established, seem nevertheless adequate to consolidate further progress in this area, which will remain a core aspect of the EU engagement in the context of future negotiations (see section 2.2.2 Chapter 24: Justice, freedom and security) Key Priority 5: Albania was requested to take effective measures to reinforce the protection of human rights, including of Roma, and anti-discrimination policies, as well as implementing property rights. The legal framework for the protection of human rights is broadly in line with European standards and Albania has ratified most international human rights conventions. The Ombudsman has been actively promoting the rights of vulnerable groups, including by submitting special reports and recommendations. The policy and legal framework on non-discrimination is broadly in line with European standards. Important steps have been taken to improve the legal framework on the protection of minorities, for which secondary legislation is now under preparation, as well as juvenile justice, child protection and property rights (financial means have been earmarked to implement ECtHR rulings). As for the integration of Roma and Egyptians , progress was achieved in early childhood and primary education, as well as access to healthcare and the labour market. The housing budget has also increased. Freedom of thought, conscience and religion was generally upheld. The overall legislative environment is conducive to the exercise of freedom of religion and progress was made in strengthening the independence of the regulatory authority and public broadcaster. Efforts for the enforcement of human rights will have to continue. (see section 2.2.1 Chapter 23: Judicial and fundamental rights ) 1.3. Summary of the report As regards the political criteria, strong polarisation persisted in the political establishment. Parliamentary activities were affected by a prolonged boycott by the opposition in early 2017, which also delayed the appointment of the judicial vetting institutions. In May, an agreement between the main ruling party and the opposition allowed resuming parliamentary activities, triggering some changes to the electoral legislative framework. This was conducive to the smooth organisation of the general elections in June, although a number of OSCE/ODHIR recommendations still remained outstanding. Some progress was made towards improving the functioning of the National Council for Civil Society. Additional efforts are needed to better involve civil society organisations as part of an inclusive policy dialogue. Albania is moderately prepared in the reform of its public administration. Efforts continued, resulting in some progress in the efficiency and transparency of public services delivery, the training of civil servants, more transparent recruitment procedures, and the overall strengthening of merit-based civil service procedures. Consolidation of these achievements should advance further, to ensure a more efficient, depoliticised, and professional public administration. Albania's judicial system has some level of preparation. The implementation of comprehensive and thorough justice reform has continued, resulting in good progress overall. The reevaluation of all judges and prosecutors (vetting process) has started and is delivering first tangible results. This process has cross-party support, is carried out by an independent authority, is subject to international monitoring and its compatibility with the European Convention on Human Rights has been confirmed by the Venice Commission. Under the aegis of the European Commission, an International Monitoring Operation has been deployed to oversee the process throughout its implementation. The auxiliary institutions supporting the process have completed their first reports on the proficiency assessments, background checks and asset declarations. Albania maintains some level of preparation in the fight against corruption. Good progress was made, notably with the adoption of amendments to the criminal procedure code. A chain of specialised anticorruption bodies, including a special prosecuto's office, is being established. The number of final convictions involving junior or middle-ranking officials has increased compared to the previous reporting period. Convictions of high-level officials occurred mostly in the judiciary (judges and prosecutors); however, the rate of final convictions for highranking officials remains overall very low. Corruption remains prevalent in many areas and continues to be a serious problem. Albania has some level of preparation in the fight against organised crime. Overall there was some progress in the reporting period, notably in the fight against cannabis cultivation. Albania needs to build on operational results in this area, intensifying confiscation of assets belonging to criminal gangs and pursuing the destruction of all existing cannabis stockpiles. Amendments to the anti-mafia law and the Criminal Procedure Code have created the conditions for increased efficiency of criminal investigations. Albania participated successfully in international police cooperation, intensifying its interactions particularly with EU Member States. At domestic level, effective police-prosecution cooperation remains to be improved. As regards the track record, there has been little progress in dismantling organised criminal groups. The number of final convictions in organised crime cases remained very low and has only marginally increased. More efforts are needed to tackle money laundering, criminal assets and unjustified wealth. Albania has ratified most international human rights conventions and has developed its legal framework in line with European standards. Enforcement and monitoring of human rights protection mechanisms remain to be strengthened. As regards the freedom of expression, Albania has some level of preparation/is moderately prepared. There has been some progress in strengthening the independence of the regulatory authority and public broadcaster but transparency of state advertising in the media remains to be enhanced. Progress remains to be made in the area of property rights with the update of the current legislation and reinforcement of institutional coordination. Institutional mechanisms to protect the rights of the child and to tackle gender-based violence remain weak. Important steps were made to improve the legal framework for the respect for and protection of minorities but relevant secondary legislation needs to be developed. Living conditions for Roma and Egyptians need to be improved. Albania has continued to participate actively in regional cooperation and maintain good neighbourly relations. Important steps have been taken to address bilateral issues with Greece. As regards the economic criteria, Albania has made some progress and is moderately prepared in developing a functioning market economy. The public debt-to-GDP ratio and the current account deficit have been reduced. Economic growth increased further and unemployment decreased but is still high. Non-performing loans (NPLs) in the banking sector have been reduced, but bank lending to businesses remains sluggish. Reforms crucial to improving the business environment progressed but require further efforts, including the reduction of the informal economy. The comprehensive judicial reform advanced but needs to be fully implemented. The new bankruptcy law entered into force and should strengthen the insolvency regime. However, business-relevant regulations remained cumbersome and shortcomings in the rule of law continued to hamper businesses and deter investments. Albania has made some progress and has some level of preparation in terms of capacity to cope with competitive pressure and market forces within the EU. Specifically, progress was made on energy and transport infrastructure and digitalisation, although shortcomings remain which hinder Albania’s competitiveness and trade. The quality of education needs to be raised at all levels, not least to better equip people with skills that the labour market needs. Foreign trade remains below potential and sectorally concentrated. Albania’s capacity for research, development and innovation remains low. Albania continued to align its legislation to EU requirements in a number of areas, enhancing its ability to take on the obligations of membership. The country is moderately prepared in many areas, such as in financial control, education and culture, or has some level of preparation, including in the areas of public procurement and statistics. Albania will need to continue its efforts as regards the overall preparations for adopting and implementing the EU acquis. It should continue work on the development of transport and energy networks, also with a view to improving connectivity throughout the region. The administrative capacity and professional standards of bodies which would be charged with the implementation of the acquis need to be strengthened and the independence of regulatory bodies safeguarded. Enhancing transparency and accountability, in particular ensuring the effective, efficient and transparent functioning of the public procurement system and public finance management, remains essential. Albania has continued to fully align with all EU common foreign and security policy positions and declarations. The number of unfounded asylum applications lodged by Albanian nationals to EU Member States and Schengen associated countries has remained high. Albania showed commitment and adopted a number of measures, including strengthened bilateral cooperation with relevant EU Member States. These measures yielded positive results. Further decisive actions have to continue, including in the framework of the post-visa liberalisation monitoring mechanism, to effectively address this phenomenon. Albania needs to put in place a return mechanism for irregular migrants, which is in line with the EU acquis, as well as to align its visa policy progressively with the EU’s.

2.Fundamentals first: political criteria and rule of law chapters 2.1. Functioning of democratic institutions and public administration reform 2.1.1 Democracy The political environment remained characterised by strong polarisation throughout the reporting period, particularly in the first half of 2017, when parliamentary activities were affected by a prolonged boycott by the opposition. This also delayed the appointment of the judicial vetting institutions. An agreement between the two main ruling and opposition parties in May allowed parliamentary work to resume ahead of the electoral recess. More recently, a number of bipartisan initiatives have been taken, including the wide cross-party consensus on the vote of principle to the law for the vetting of the police, the establishment of investigative committees, as well as continued dialogue in the ad hoc committee on electoral reform. Elections The 2017 parliamentary elections were held in an orderly manner and its results were accepted by all parties. The May 2017 cross-party political agreement resulted in the opposition’s participation in the election and a less aggressive electoral campaign. It also led to some changes to the electoral legislative framework. In its report, the Office for Democratic Institutions and Human Rights of the Organisation for Security and Cooperation in Europe (OSCE/ODIHR) highlighted the persistent politicisation of electoral bodies, widespread allegations of vote-buying and pressure on voters. High-level political commitment is required to improve and properly implement the legal framework. The newly established ad hoc parliamentary committee on electoral reform should address outstanding OSCE/ODIHR recommendations in an inclusive manner, well ahead of the 2019 local elections. The 18 May political agreement between the Prime Minister and the leader of the main opposition party ended 4 months of parliamentary boycott by the opposition and secured participation by the latter in the 25 June parliamentary elections. It granted six ministerial positions to the opposition in sectors key to elections. A task force, chaired by a deputy prime minister from the opposition, was established to monitor and coordinate the public administration’s conduct during the campaign and on election day. The agreement contributed to a less polarised campaign and a largely incident-free election. However, OSCE/ODIHR expressed concerns over the low level of public trust in the electoral process and the continued politicisation of the election-related bodies. It reported widespread allegations of vote-buying, as well as concerns over abuse of state resources and pressure on voters. Some OSCE/ODIHR recommendations on sanctions for electoral violations, transparency and accountability of campaign financing, and the rights of observers were partially addressed through the amendments to the legislative framework and sub-legal acts of the Central Election Commission adopted in May. However, the ad hoc electoral reform committee failed to achieve comprehensive reform through broader amendments to the Electoral Code. All outstanding OSCE/ODIHR recommendations should be addressed as a priority through both legislative and administrative measures. A new ad hoc parliamentary committee was established in October 2017 to address OSCE/ODIHR recommendations outstanding from the last three elections (2013, 2015 and 2017). It is jointly chaired by the two main majority and opposition parties and includes representatives of all parties in Parliament. Parliament The last year of the outgoing parliament was marked by a high degree of polarisation and an extended opposition boycott. Overall, the role of the Parliament in initiating and amending legislative proposals, as well as consultations in parliamentary committees, has increased. The new legislature has so far demonstrated commitment to electoral reform and improved conduct in plenary sittings. Implementation of the so-called Decriminalisation Law led to the removal of four members of Parliament during the reporting period. More efforts are required to achieve effective oversight, strengthen constituency links, increase transparency and ethical conduct, and strengthen Parliament’s research capacity. Political polarisation and the extended opposition boycott hindered political dialogue and parliamentary work. The opposition boycotted parliamentary activity between February and May 2017 and threatened not to take part in elections. The political agreement of 18 May 2017 led to the opposition returning to Parliament, enabling the completion of the vetting commissions. Parliament elected former Speaker Ilir Meta as President of the Republic in April 2017, with the votes of the governing majority. The 2017 parliamentary election gave the Socialist Party 74 seats and the mandate to govern alone. The Democratic Party and Socialist Movement for Integration became the two largest opposition parties, with respectively 43 and 19 seats. About one third of the 2017-2021 MPs were elected for the first time and the number of women representatives elected rose to 40 (28.5 %). In September 2017 Parliament nominated its Speaker and the Prime Minister and voted through the government’s political programme. Four members of Parliament (and one mayor) lost their mandates under the so-called decriminalisation process in December 2016 and January 2018. Overall, seven MPs lost or forfeited their mandates in the reporting period, and an eighth was found to have had business interests incompatible with a parliamentary mandate. The Constitutional Court decided in autumn 2016 that the mandates of two other MPs were compliant with constitutional provisions. At the request of the prosecution, in October 2017 Parliament partially lifted the immunity of MP Tahiri, former Minister of Interior. Despite improved conduct in plenary sittings, procedural rules are sometimes not respected and public expectations are often not met. The Code of Ethics, which has been in parliamentary procedure since early 2016, still awaits approval. Coverage of all 12 regions with constituency offices has yet to be ensured. Communication channels between citizens and MPs need to be formalised and strengthened. Regarding Parliament’s legislative role, the number of laws and amendments put forward by MPs and the regularity of hearings with government and interest groups at committee level has increased. Parliament accepted three presidential decrees returning laws for parliamentary review. Overall, the opposition gave its approval to a limited number of laws. Parliament adopted 17 laws requiring a qualified majority vote, most of which form part of the justice reform package. Parliamentary rules of procedure should reflect the law on the role of Parliament in the EU integration process adopted in March 2015. The capacity of the National Council for European Integration has been strengthened by a dedicated support unit, which remains to be fully staffed. The Council has held a number of consultations and training sessions, but is yet to fully assume its role as a forum for broad involvement and consultation on EU integration issues. The EU Integration Committee held a number of oversight hearings during the reporting period. Parliament’s overall capacity to monitor the implementation of new legislation and its compliance with the acquis remains limited. Coordination with the executive branch needs to be improved. On Parliament’s oversight function, the work of inquiry committees remained highly conflictual and lacked results. The mandates of the two inquiry committees established in 2016 on the privatisation and renationalisation of the Electricity Power Distribution System Operator were extended in January and February 2017. An inquiry committee on telephone surveillance was established in October 2016 at the request of the opposition and another on cannabis cultivation and the case of former Minister Tahiri was recently established. Other oversight mechanisms remained underused. In the last year there were few Prime Minister and cabinet questions and oversight hearings at committee level. Parliament conducted a structured review of annual reports from independent institutions and adopted 15 resolutions, which are however not discussed in plenary. The April 2017 decision to establish a system for following up and monitoring recommendations by Parliament and independent institutions marked a step towards stronger oversight in this regard. The Ombudsman, as well as the chair and one member of the Central Election Commission, were appointed as part of the 18 May political agreement. The assembly has yet to finalise a second process for electing the Commissioner for Protection against Discrimination, after failing to elect one in March 2017. As regards transparency and accountability, Parliament has overall ensured access to documents and activities. A two-year communications strategy was approved in May 2017. A review has continued of the internal rules of organisation of Parliament’s administration and training, including activities undertaken under the EU Twinning Project. Political parties have partially reflected OSCE and EU recommendations on transparency of party funding, agreeing on legal amendments ahead of the 2017 parliamentary elections. Further reform, including amendments to the Electoral Code, is required. Issues persist in relation to internal party democracy and due implementation of statutes.

Governance The government remained committed to the EU integration process but the pace of reform was affected by the electoral campaign and changes at ministerial level. The new government, established after the June elections, reconfirmed that Albania’s EU accession was a key priority. The government has launched a restructuring of the whole public administration which aims to reduce the number of ministries and state agencies while delivering services more efficiently. Further progress was made at local government level, with the adoption of the laws on local finances and on the organisation and functioning of local governance. The Consultative Council was established and started operating as the main mechanism for institutional coordination between central and local governments. During the reporting period, the government was reshuffled three times and changed once. Two reshuffles took place in January and March 2017 within the ruling coalition of the Socialist Party and the Socialist Movement for Integration. Following the 18 May 2017 agreement mentioned above, the opposition Democratic Party was granted six ministerial posts with responsibilities linked to the elections. The reshuffle included the position of deputy prime minister and the chairmanship of some key state agencies. This joint government decreased public tension and polarisation and demonstrated some cross-party ability to overcome stalemate. However, cooperation between the two main parties stalled after the elections. In September 2017, a new government took office, with the Socialist Party Chair receiving an absolute majority for a second mandate. The restructuring process proposed by the new government has started. The central government underwent a full restructuring of ministries and of the Prime Minister’s office: the number of ministries was reduced from 19 to 11 and policy functions streamlined in new ministerial departments. The restructuring led to a significant redistribution of competencies and merging of administrations. The lower number of ministers was balanced by an increase in the number of deputy ministers to 33. The new government marks a clear commitment to gender equality, with 7 out of 14 ministers being women, including the Deputy Prime Minister. Further to these steps already taken, state agencies and independent bodies will be reduced in size and streamlined with the aim of optimising consistency and efficiency in administrative performance. Key measures in the restructuring are the dismantling of agencies with mixed functions, the merging of those with overlapping functions and the devolution of institutions to the four development regions in coherence with territorial administrative reform. The restructuring process created a temporary vacuum in some areas of governance, which shall be swiftly overcome, in order to prevent losses of efficiency in the continuation of reform implementation. With the new government, a dedicated State Minister for relations with the diaspora was nominated. The Constitutional Court issued 71 decisions in 2017, two of which were related to the justice reform and one to property rights. The constitutionality of the vetting process was contested twice before the Constitutional Court but the latter rejected these appeals. Regarding local government, the implementation of territorial reform continued and the newly created municipalities were further consolidated, administratively and financially. Appointments in breach of the civil service law continue to be a common practice hindering merit based civil service. The implementation of the 2015-2020 national cross-cutting strategy for decentralisation and local governance continued. Under the territorial administrative reform, the Law on Local Self-Governance Finances was adopted in April 2017. It aims to strengthen the fiscal autonomy of local governments and ensure a predictable, transparent and inclusive process for allocating funds that is responsive to local governments’ needs. The Law ‘On Qark’s Prefect’, adopted in October 2016, strengthened the role of prefects in overseeing the implementation of legislation and delegated functions by local government units. The Consultative Council, established in December 2016, is operating as the main mechanism for institutional coordination between central and local governments. In January 2018 the Agency for Implementation of Territorial Reform was transformed into the Agency for Local Self Government Support, widening its scope under the responsibility of the Ministry of Interior. With regard to public participation in local decision making, further progress has been made in the area of access to information: an increasing number of municipalities have disclosed public information and nominated a local coordinator responsible for the right to information. The institutional framework for public participation in local decision-making, particularly in the budgeting process, needs to be strengthened for all municipalities. On territorial planning there has been some progress, with increasing numbers of municipalities drafting ‘general local plans’ supported by the government. Additional efforts are needed to increase the capacity of local government units to carry out their expanded responsibilities, improve training and manage their finances more efficiently. Full implementation of the law on civil servants at local government level has yet to be ensured. Arrears continue to be a potential source of financial instability. A network of 61 Local EU coordinators has been created. Each municipality is setting up an 'EU desk' with the aim to strenghten municipal EU related governance capacities and reach out to Albanian citizens and local administrations with information about the EU, its policies, funds and programmes. Civil society Some progress was made towards improving the functioning of the National Council for Civil Society and through approval of the Law on Social Enterprises. Substantial efforts are needed to ensure meaningful consultations with civil society actors as part of an inclusive policy dialogue. The financial sustainability of civil society organisations remains a challenge due to fiscal and legal frameworks. An empowered civil society is a crucial component of any democratic system and should be recognised and treated as such by the state institutions. Albania’s legal and regulatory framework on the right of freedom of association is generally in line with international standards. The 2014 Law on Public Consultation laying down the procedural norms for transparency and public participation in decision-making is in line with European standards. However, the registration process is still a problem due to the high financial cost of registration, lengthy procedures and lack of specialised judges. Implementation of the laws on volunteering and on social enterprises is hampered by the lack of sub-legal acts. In 2017, the National Council for Civil Society (NCCS) had two meetings. The first one, held in February 2017, was organised with the support of the Agency for Support to Civil Society acting as a technical secretariat. An interinstitutional working group was established to follow up the implementation of the roadmap for engagement with civil society. The set-up of the NCCS needs to be aligned with the structural composition of the new government. In December 2017 the NCCS adopted its rules of procedures and elected a new deputy head coming from civil society. Consultation of civil society in legislative and executive processes has increased but needs to be more systematic, transparent and with adequate time frames at the central and local levels. So far, civil society participation still remains occasional. No significant developments took place in the legal and regulatory framework of the tax regime for civil society organisations (CSOs), which remains a problem. This is a significant financial burden for CSOs and the current legal environment does not support alternative funding sources. Tax incentives for corporate donations do not stimulate donations to CSOs, while individual donations are not recognised. Public funding for CSOs remains limited and is not yet legally regulated at central and local level. 2.1.2. Public administration reform Albania is moderately prepared with the reform of its public administration. Some progress was made, especially in improving the efficiency and transparency of public services delivery, training civil servants, establishing more transparent recruitment procedures and strengthening the administration’s capacity to undertake merit-based recruitment. Implementation of the public administration reform and public financial management reform strategies has continued, although for the past few months some steps in the process have been on hold, following the general elections and central government restructuring. Any further reorganisation of the public administration needs to be carried out in a consistent and evidenced-based manner. The Commission’s recommendations from 2016 were partially addressed. In the coming year, Albania should in particular:

→implement regulatory and fiscal impact assessments across all ministries with a view to improving the quality of legislative and policy proposal, reflection of their financial estimates and their costing and budgeting of Medium Term Budget Plan; →develop a comprehensive salary policy for a fair, transparent and merit-based salary scheme in public institutions and enable automated payroll through the human resource management information system and the treasury; →ensure effective implementation of the Code of Administrative Procedure by completing the harmonisation of relevant regulations with the code.



Policy development and coordination The legal basis and the institutional set-up are in place to ensure a consistent policy-making system, including for European integration. Policy planning remains fragmented among various centre-of-government institutions and line ministries. Harmonisation of central planning documents with sector strategies in line with government priorities remains limited. Alignment of policy and fiscal planning needs to be further strengthened. Institutional capacity for coordinating, reviewing and monitoring policy needs to be further improved. The institutional responsibility for coordinating the national plan for European integration is assigned to the new Ministry for Europe and Foreign Affairs. Monitoring and reporting of implementation of such plan have improved, but the rate of implementation remains low and has decreased from 56 % in 2016 to 25.5 % in 2017, particularly due to delays following the ministerial restructuring. The administration needs to further strengthen its capacity to develop inclusive and evidence-based policy and legislation, including the acquis. While procedures for legislative alignment with the acquis are in place, the impact of such alignment is not properly analysed and implementation costs are not duly forecasted. Two pilot ministries have started to apply regulatory impact assessments, but more systematic use of such assessments needs to be put in place and the relevant staff need to be trained. Inter-ministerial consultation and the quality of analysis supporting new policy proposals needs to be further improved. Public consultation is regulated but needs to be fully implemented. The electronic web portal for public consultations became operational in 2017, but it is not yet used by all ministries. Public scrutiny of government work is still limited, especially because monitoring and reporting on government activities is not coherently regulated, coordinated or implemented. Monitoring and reporting is often limited to the implementation of activities and rarely assesses their results. Public financial management The government continued to regularly monitor implementation of the public financial management reform strategy for 2014-2020 and published the second monitoring report for 2016. The report assesses progress against a more robust result indicator matrix with baselines and targets. The main improvements in public financial management relate to the 2017 budget preparation in line with the revised Organic Budget Law; adoption of the law on local government finances; amendments to the Public Procurement Law to improve the independence of the Public Procurement Commission; increased clearance of arrears; online access to the treasury system; a campaign to combat the informal economy; and the piloting of external audit manuals. The mandate of the Ministry of Finance was broadened to include the mandate of the former Ministries of Economy, Labour, and Employment. Such reorganisation mirrored only an increase from 293 to 323 staff in the new ministry, its capacity to deliver reform needs to be maintained. Reforms in the next period are focussed on: improving budget planning and management; strengthening internal control standards across government; preventing arrears, at central and local government level; following-up internal and external audit recommendations; improving investment planning and management; improving the public procurement review and compliance with procurement rules; granting online access to the treasury for more institutions; analysing the fiscal risks of state-owned enterprises; and establishing the fiscal cadastre and value-based property taxation (see also chapters 5, 16, 29 and 32). Budget transparency has improved further with government publishing seven out of eight key budget documents in a timeframe consistent with international standards. The 2018 budget, the citizens’ budget for the 2018 draft budget and the list of public investments under the medium-term budget programme have been published, but public participation in the budget process needs to be further strengthened. The 2016 budget implementation report was published but its structure remains weak in reporting on state assets and in the degree of comparison it allows with the original budget. Inyear reporting is available but the mid-year report covers 5 instead of 6 months. Public service and human resources management The Civil Service Law provides a clear scope for the civil service. Public employees in institutions delivering services directly to citizens are covered by the Labour Code. As a result, uniform standards on merit-based recruitment, promotion and dismissal of all public administration staff have yet to be applied. The Civil Service Law provides a solid basis for merit-based recruitment and promotion. The recruitment process has become more efficient (with 86 % of the planned vacancies filled in 2016 in comparison to 66.5 % of the planned vacancies filled in 2015). The recruitments are more transparent as a result of improved examination procedures, the introduction of an online application system and the evaluation of electronically written tests. There has been a significant decline in the average number of applicants per position. Mobility within the civil service increased due to a rise in transfers between institutions (from 75 in 2015 to 146 in 2016) and in promotions (from 29 in 2014 to 101 in 2015 and 188 in 2016). The civil service law remains weakly implemented at the local level. Appointments in breach of civil service law remain problematic for the local level of public administration. While the number of dismissals has decreased since 2015, the implementation of court decisions favourable to dismissed civil servants remains very low. The capacity of the Department of Public Administration to lead the management of human resources was improved thanks to a staff increase from 53 to 58. The use of human resources management information system (HRMIS) is still not fully functional, hampering strategic human resources planning and monitoring. Further data on public service organisations and employees was added to the HRMIS, but it does not yet cover the whole civil service. Generation of payroll reports were piloted in 30 institutions, but the link with the treasury system is not operational. Public institutions cooperate effectively with the Commissioner for Oversight of the Civil Service, but the Commissioner's administrative capacity needs to be further strengthened to better ensure the oversight role. The remuneration system for public servants is in principle transparent and based on a job classification system. While salary levels for selected positions were increased in 2017, a reform of the whole job classification system is pending. The application of salary supplements is not uniform across various public institutions and information is not publicly available. Salary increase is not linked to the promotion and performance appraisal system. Progress in unifying salary schemes across the public administration remains insufficient. The training programmes implemented by the School of Public Administration contribute to the professional development of civil servants. However, an integrated training management cycle is needed to be more responsive to institutional needs. The budget is not sufficient to cover the increasing number of training courses needed following the restructuring process. The integrity and prevention of corruption of public officials and civil servants is regulated, and institutional capacity for asset and conflict of interest declarations has been reinforced. Accountability of the administration

The legal framework on the organisation of the central administration is in place and regulates the accountability lines between institutions. However, it is hard to distinguish between the functions of subordinated bodies and those of autonomous agencies. The ongoing restructuring process needs to result in a clear framework for all subordinate bodies. Managerial accountability within institutions is still focused on processes rather than the achievement of results, and there is no delegation of responsibility to middle management (see chapter 32). Citizens’ right to good administration is limited in practice because oversight institutions’ recommendations have not been adequately implemented. Fewer than 30 % of the Ombudsperson’s recommendations were implemented in 2017. The right to access public information is regulated by the Law on the Right to Information, but its implementation has revealed shortcomings in the legal framework. Increasingly, more public authorities have adopted transparency programmes, but more efforts are needed to promote proactive disclosure of information by public institutions. The capacity of the Commissioner for the Right to Information and Protection of Personal Data to oversee the process needs to be increased. The legislative framework for the right to administrative justice is in place. The capacity of the administrative court system to deal with the backlog of cases has improved at the firstinstance level, but there is a backlog of cases at the appeal court level due to the country having only a single administrative court of appeal. The legislation for protecting the right of citizens to seek compensation is in place but court cases remain rare due to limited public awareness of this right. Due to the lack of data collection, it is not possible to assess the effectiveness of the liability regime. Service delivery to citizens and businesses The institutional set-up and the strategic and legal framework for coordinating the delivery of public sector services are in place to promote user-oriented administration. The Law on Delivery of Front Office Services is in place. It foresees the reduction of administrative barriers and promotes transparent services to citizens to reduce the risk of corruption. The Agency for the Delivery of Integrated Services has introduced standards to improve service delivery. It has also started measuring user satisfaction and set up one-stop-shops across the country. E-services need to be further developed and easily accessible information about public services needs to be provided to all citizens. The legislative framework for simplifying administrative procedures is in place, following the entry into force of the Code of Administrative Procedure in May 2016. However, progress in adopting the necessary implementing legislation, reviewing the special administrative procedures and adjusting the sector legislation has been limited. This is due to the lack of a lead coordinating institution. Strategic framework for public administration reform The public administration reform strategy for the period 2015-2020 is in place and the second annual implementation report was published in March 2017, accompanied by a midterm review. A new action plan for 2018-2020 is still under preparation, as there have been delays due to the ongoing restructuring process. The political responsibility for PAR has been assigned to the Deputy Prime Minister, ensuring continued administrative and political support for reform. The technical support on PAR has been assigned to the Department of Public Administration, which will have the role of the technical secretariat, in cooperation with the Department of Development and Good Governance. Financial sustainability has been improved by closing the financial gap from 29 % to 19 % from 2016 to 2017. The costing of the new action plan needs to be aligned with the medium-term budget programme and ensured in the annual budgets. 2.2. Rule of law and fundamental rights 2.2.1. Chapter 23: Judiciary and fundamental rights The EU’s founding values include the rule of law and respect for human rights. A properly functioning judicial system and an effective fight against corruption are of paramount importance, as is respect for fundamental rights in law and in practice. Albania has some level of preparation to implement the acquis and European standards in this area. Good progress was made, in particular through the continuation of the justice reform and the adoption of the full legal package. The new legislation tackles many shortcomings related to the justice system’s lack of independence, efficiency and professionalism. However, corruption is widespread and remains an issue of concern. The impact of various measures has yet to be seen. There has been further progress in enforcing human rights, especially at the local level, and on strengthening the institutional mechanisms to defend the rights of children, tackle gender-based and domestic violence and protect vulnerable groups. Albania should in particular: →advance the implementation of justice reform. This should include completing the set-up of the new judicial structures (the High Council of Justice, the High Prosecutorial Council, the High Justice Inspector and the Justice Appointment Council) and achieving first results in the process of re-evaluating judges and prosecutors; →progress further in establishing a solid track record of investigations, prosecutions and convictions in combating corruption at all levels, including asset recovery; →make significant progress towards the protection of property rights (including compensation and registration). Functioning of the judiciary Albania has some level of preparation. Good progress was made through continued implementation of the justice reform. The process of re-evaluating all judges and prosecutors has started and is delivering the first tangible results. Following the establishment of the vetting institutions, the first set of priority cases is being reviewed. The auxiliary institutions supporting the process have completed their first reports on the proficiency assessments, background checks and asset declarations. Appeals against the vetting law and the related underlying legislation of the judicial reform have been adjudicated by the Constitutional Court. The latter confirmed the Vetting Law’s constitutionality. A number of provisions in the laws on the governance of the judiciary and on the status of judges and prosecutors have been declared unconstitutional and were annulled, thus requiring legislative follow up. There has been no progress in carrying out the recommendations on making more effective use of the case management system, on issuing reasoned adjudications in due time and on allocating cases randomly to judges and prosecutors. In the coming year, Albania should in particular: →achieve further results in the process of re-evaluating judges and prosecutors; →finalise the creation of the new independent judicial institutions, namely the High Council of Justice, the High Prosecutorial Council, the High Justice Inspector and the Justice Appointment Council;

→continue to pursue a sector approach to the justice reform under the cross-cutting strategy for 2017-2020 and ensure adequate governance, monitoring and reporting mechanisms through well-developed indicators coupled with adequate financial support for its implementation. The judiciary of Albania is currently undergoing a comprehensive and thorough transitional re-evaluation process (vetting). The vetting was launched with the overall objectives of strengthening professionalism across the sector, eradicating corruption, consolidating independence and impartiality and, ultimately, rebuilding public confidence in the judiciary. The process rests on three pillars: proficiency assessment; asset verification, which is performed on all assessees, as well as on all their close relatives for wealth accumulated in Albania and abroad; and links to organised criminal networks. Following a request from the Albanian authorities, the European Commission has deployed under its aegis the International Monitoring Operation (IMO), which has the mandate to oversee the process throughout, while decision making remains within the remits of the vetting authorities of Albania. These include an Independent Qualification Commission (IQC), two Public Commissioners, and an Appeal Chamber. From October 2017 onwards, the IQC started the analysis of the first priority dossiers. A batch of nine "top priority" dossiers included the members of the Constitutional Court, the President of the High Court and the General Prosecutor. The remaining cases to be treated with priority (47 amongst the highest ranking members of the judiciary) were also already allocated to IQC panels and the respective rapporteurs were identified. Their assessment is ongoing, in parallel with the review conducted by the IMO International Observers. The auxiliary bodies (HIDAACI, in charge of assets verification, and the working group chaired by the National Security Agency, in charge of background checks) have already delivered to the IQC and the IMO a significant number of dossiers, including all those related to all priority cases. The High Inspectorate at the High Council of Justice and the Ad Hoc Commission within the General Prosecutor’s Office delivered the proficiency assessment for the top priority cases and they are advancing on delivering the reports on all remaining priority assessees. As from January 2018, based on the progress achieved in the revision of dossiers and on the operating procedures, the IQC allocates to their respective rapporteurs a batch of 36 new cases every two months. First tangible results have been noted since the vetting law started to be implemented. When the process was initially launched, seven members of the judiciary (one High Court judge, two judges, one prosecutor and three senior legal assistants) resigned, refusing to submit their assets and patrimonies for verification. Later in 2017, when the vetting institutions started to operate, one judge from the constitutional court and five judges from the High Court opted to leave duty respectively at the retirement time and at the end of their legal mandate. According to the legal provisions they were obliged to stay in office until the appointment of the successors and thus undergo the vetting and be placed amongst the priority dossiers, based on their role and functions. In addition to these, a senior legal assistant and a prosecutor also resigned. Once the Independent Qualification Commission started to complete the first sets of investigations, two top ranking members of the judiciary resigned from service and requested their vetting to be terminated, these were a Constitutional Court judge and the former General Prosecutor. The first hearing in March 2018 resulted in the dismissal of a Constitutional Court judge. A second hearing in early April resulted in the confirmation in duty of a Constitutional Court judge. A third hearing in April resulted in the dismissal of a judge at a Court of Appeal, who was also a candidate to the High Judicial Council. In addition to the activities of the vetting bodies, some members of the judiciary were dismissed from service or suspended during the reporting period, in connection with court decisions or investigations against them. Specifically, three judges have been dismissed (Berat, Tirana, Elbasan District) following a final court decision convicting them. Based on criminal investigations, five judges have been suspended from duty, pending a final court decision; out of these, the High Council of Justice decided also to suspend three judges of the Appeal Court of Durrës (one being also the Chair of the Court) based on a request from the Serious Crimes Prosecution Office, where they are under criminal investigation for abuse of power. Strategic documents The cross-sectoral justice strategy for 2017-2020 and its action plan were adopted in November 2016. The estimated budget for its implementation is EUR 98 million, of which 35 % is provided by international donors. The establishment of appropriate monitoring, evaluation and reporting mechanisms remains outstanding. A monitoring body has been appointed within the Ministry of Justice. Management bodies The justice reform package envisages setting up a High Judicial Council and High Prosecutorial Council as the two main self-governing bodies of the judiciary that are independent from the government. The councils will gather the majority of members from within the judiciary but five members will be selected from advocacy, academia and civil society. The councils are empowered to appoint, promote and evaluate judges and prosecutors. In contrast to previous structures, the members of the councils will serve full time for a five-year term without possibility of re-election. Annual reports produced by the councils and all relevant findings and recommendations should be made public. The councils should report annually to Parliament. The Minister of Justice may participate in the meetings of the High Judicial Council when issues of strategic planning and budget are discussed, but does not have voting rights or any responsibility for the inspection and evaluation of judges. The selection process is based on objective criteria. The list of the lay member candidates has been approved, following a lottery at the Parliament, as per the unblocking mechanism provided for in the relevant law. Candidates coming from the ranks of the judges and prosecutors are elected to the two new separate councils by the General Assembly of Judges and the General Assembly of Prosecutors respectively. The application process is run respectively by the High Court and the General Prosecution Office. Candidates to both Councils have already been shortlisted, but they can be voted by their peers only once their vetting is carried out. The creation of the new councils is pending. Until they are established, the existing High Council of Justice acts with limited competences. Independence and impartiality The principles of impartiality and judicial independence are set out in the Constitution and reflected in the laws on the governance of the judiciary and on the status of judges and prosecutors. The reform has given prosecutors greater autonomy and reduced the centralisation of the system around the General Prosecutor. Judges and prosecutors cannot be transferred without their consent. Exceptions concern disciplinary measures, structurally justified changes or temporary needs. Judges can be dismissed only for serious misconduct or if sentenced for a criminal offence. The dismissal decision may be appealed at the Constitutional Court. However, attempts at interference, including by authorities internal to the judiciary, have been an issue of concern and need to be addressed beyond the vetting process. The allocation of cases should be conducted randomly by lot and through electronic means. However, the electronic case management system has shown many shortcomings. Random allocation of cases to prosecutors is partially used, but prosecution offices often fail to make full use of the system and to produce reliable data. The laws provide for strict procedures in case of undue influence over a court case or when judges consider their independence to be jeopardised. Accountability The Code of Ethics for judges and prosecutors is now regulated by law and is no longer a noncompulsory document produced by the National Conference of Judges. Once established, the new High Judicial Council and the High Prosecutorial Council should be responsible for approving the ethics rules and code of conduct and ensuring their monitoring. While the High Council of Justice has improved evaluation forms and adapted these to the new legal standards, the performance of judges continues for the most to be measured on the basis of numbers of complaints and final court convictions. Until the establishment of the High Justice Inspector, the High Council of Justice and the General Prosecutor should continue to investigate disciplinary misconduct. Based on the latest reform, disciplinary proceedings have to be initiated by the High Justice Inspector and no longer by the Minister of Justice. However, the latter retains the right to submit a complaint and to request the High Justice Inspector HJI to carry out an examination of prosecutors. Improvements in the recruitment process for the School of Magistrates have included an integrity test and a psychological assessment related to the integrity and moral standards of candidates. Judges and prosecutors are obliged to declare their assets on an annual basis. Under the vetting law, the High Inspectorate for the Declaration and Control of Assets and Conflict of Interest administers and verifies all data obtained through the declarations of assets and private interests of all those vetted. Lack of compliance with this obligation is to be followed by automatic dismissal. Professionalism and competence The system for recruiting, selecting, appointing, transferring and dismissing judges and prosecutors has been improved. Constitutional and legal changes have reduced political influence during the appointment process, ensuring a merit-based career system. The High Court is currently composed of 19 members, with only eight members exercising their functions. Former members have mostly resigned after the termination of their mandate and one judge has been suspended after being found guilty of corruption, with her dismissal pending a final court decision. Vacancies in the High Court will be filled once the High Judicial Council is established.

Appointments to the Constitutional Court are awaiting the formation of the members of the Justice Appointment Council (JAC), who are undergoing vetting. The JAC is the independent institution responsible for verifying and ranking the legal, professional and moral criteria for the appointment of judges in the Constitutional Court and for the candidates of the High Justice Inspector. The procedures to form the JAC have been initiated. The General Prosecutor (GP) should be elected following a proposal by the High Prosecutorial Council and approval by a qualified majority in Parliament. The mandate of the current GP ended in December 2017. Since the new GP cannot be elected until the High Prosecutorial Council is formed, the transitional provisions provided for the possibility of a temporary GP elected by a simple majority in Parliament. The responsibilities of the temporary GP are also limited under the law. The vetting process for all judges and prosecutors also provides for the professional abilities of all those vetted to be re-evaluated. The School of Magistrates is preparing the proficiency testing for non-magistrates assessees. Quality of justice Albania has 408 full-time judges (13 per 100 000 inhabitants) and 336 full-time prosecutors (11 per 100 000 inhabitants). There are 44 lawyers per 100 000 inhabitants. According to the European Commission for the Efficiency of Justice (CEPEJ), the European average is 21 judges/11 prosecutors per 100 000 inhabitants. The 2017 budget for courts was EUR 98 million (compared to EUR 91.7 million in 2016). This amounts to EUR 5.41 per inhabitant, with EUR 4.3 per inhabitant for the prosecution offices. General government expenditure on courts represents 0.13 % of GDP, a 0.1 % reduction from 2016. Total expenditure provided in the 2017 budgetary plan for the justice sector was EUR 12.15 million, 2.5 % less than the 2016 budget. The creation of the new judicial institutions will be supported by a multiannual action plan of EUR 3.7 million allocated from the reserve fund of the Treasury. Judicial infrastructure remains poor overall and future budget allocations shall take this aspect in due account. Some hearings continue to be held in judges’ offices as spending on court premises has not been prioritised due to the establishment of the new judicial institutions. The realisation of a new court mapping is being planned by the Ministry of Justice in cooperation with the High Council of Justice. This new structure should ensure a more efficient use of court resources. The School of Magistrates is responsible for initial and continuous in-service training of judges and prosecutors. The training needs are identified by the School in cooperation with stakeholders within the judiciary. The new legislation provides for extending the School’s responsibilities, which should include training for legal advisers at all court levels, court chancellors, court administrators and the state advocates. However, the 2017 budget envisaged an 8.6 % cut for the School. The institution therefore continues to rely on donor support instead of enjoying a solution that provides sustainability in the long term. Most of the training related to the new legislation has been conducted with donor support. The School has limited capacity in terms of academic staff, qualified specialised trainers and premises. Its overall capacity needs to be improved as a matter of priority in order to progress with recruiting new members of the judiciary while the transitional re-evaluation of judges and prosecutors advances. A structured needs assessment and proper evaluation mechanism shall also be developed in order to strengthen the overall effectiveness of the school. The High Council of Justice monitors and evaluates court activities on a monthly basis. All courts are required to send a monthly report to the High Council of Justice and they also produce annual activity reports. However, the High Council of Justice’s annual report for 2016 is still under preparation and institutions often lack the capacity to produce reports. All courts have websites which are publicly accessible, although the data is not always fully updated due to lack of capacity, including full functionality of the electronic management system. The High Court issued two rulings unifying case-law in 2016, both related to administrative case-law. The impact of alternative dispute resolution continues to be low. The total number of cases referred to and solved through mediation was 2 077 compared to 1 260 in 2016. Efficiency Consolidated reports are still lacking on the efficiency of the justice system, which includes the length of proceedings, clearance rate and pending cases at all court levels including the Constitutional Court. The clearance rate is lowest for the appeal courts, particularly for the Appeal Administrative Court (37 %), due to a high number of appeals and the low number of judges allocated to the Court. The highest clearance rate (100 %) is in the first-instance court of serious crimes. The highest number of pending cases is in the High Court, where the backlog is currently estimated at approximately 22 500 cases. There are 224 pending applications at the European Court of Human Rights; in 2016-2017 the court issued 131 judgments, of which 117 have been executed. Changes in the procedural codes under the reform have provided for improved legal provisions on the length of proceedings, and a human resource strategy should be developed by the High Judicial Council. In addition to the overall length of court proceedings, the execution of court decisions remains a cause of concern. Furthermore, shortcomings persist in the case management system, affecting its proper functioning. The system also requires proper maintenance and standardised procedures since it is still not producing reliable statistical data. The system should also be integrated with other relevant databases. Fight against corruption Albania has some level of preparation in the fight against corruption. Good progress was made, notably with the adoption of amendments to the Criminal Procedure Code, the Law on the Declaration and Audit of Assets, Financial Obligations of Elected Persons and Certain Public Officials, the Anti-Mafia Law and the Law on Political Party Financing. The recommendations of the last Albania report were either fully or partially fulfilled. The number of final convictions involving junior or middle-ranking officials has further increased. Convictions of high-level officials occurred mostly in the judiciary; however, final convictions for high-ranking officials remain very low overall. Substantial work was done to improve the legal framework on interceptions and surveillance, time limits for investigation, admissibility of evidence before courts and on political party financing. The specialised institutions to fight corruption have yet to be established. Direct access to databases for prosecutors and the police continued to improve. In the coming year, Albania should in particular: ®step up efforts to increase the use of financial investigations in line with the standards of the Financial Action Task Force (FATF), and establish a track record of seizure and confiscation/recovery of criminal assets resulting from corruption-related offences; ®establish an effective chain of well-resourced and specialised anti-corruption bodies, composed of the Special Anti-Corruption and Organized Crime Structure (SPAK) and National Bureau of Investigation (NBI) and Court to address high-level corruption;

®continue to improve access to national electronic registries for prosecutors and police, notably by establishing an integrated case management system between police, prosecution and courts. Track record As regards the track record of investigations, prosecutions and convictions in the fight against corruption, the positive trend of recent years continued. The number of final convictions involving junior or middle-ranking officials increased compared to the previous reporting period (there were respectively 316 convictions in 2016 and 331 in 2017, compared to 286 in 2015). The overall number of referrals to the prosecution has also increased (1 977 in 2015, 1 910 in 2016 and 2 342 in 2017). Regarding convictions of high-level state officials, the judiciary has achieved some initial good results. Convictions have been obtained against prosecutors and judges (6 first-instance and 2 second-instance convictions in 2016 for passive corruption, and 3 first-instance and 4 second-instance convictions in 2015). In 2017, one first-instance and 4 second-instance convictions were issued, including a conviction against a Supreme Court judge. The High Council of Justice suspended two judges, one of whom was arrested. There have been 72 new cases opened against high-level state officials in 2016, 61 in 2017, compared to 39 in 2015. However, the number of final convictions of high-ranking state officials remains very low. As regards asset declarations by high state officials, the High Inspectorate of Declaration and Audit of Assets and Conflicts of Interest (HIDAACI) referred 22 cases to the prosecution in 2017 and 29 cases in 2016. Of the 2016 cases, 7 heads of commune were convicted for refusing to declare their assets. In total, HIDAACI submitted 72 criminal referrals of low- and mid-ranking officials to the prosecution services in 2016 (of which 20 resulted in final convictions). Seizure and confiscation of criminal assets should be systematically ordered to detect and cut the financial flows of criminal networks. An analysis to identify sectors at risk of corruption is not conducted systematically. The number of investigations started ex-officio needs to be increased, and a solid track record of investigations, prosecutions and final convictions in corruption cases needs to be established. The rate of implementation of the State Audit Institution’s general recommendations by public institutions remains low. The National Coordinator against Corruption installed a corruption cases monitoring system. Little progress was made to set up an interface between the different electronic case management systems of the police, prosecution and courts. The budget for their implementation needs to be secured. The use of audits and inspections on the basis of risk assessment in the tax and customs services increased, but needs to be further stepped up. Efforts are continuing to address corruption in the tax and customs administration, notably with the restructuring of the General Directorate of Taxation and of the General Directorate of Customs. Implementation of the Law on whistle-blowing and whistle-blower protection started in 2017. At both central and local institutions, 156 units responsible for protecting whistleblowers and for reporting cases to HIDAACI have been established. During 2017, private entities with more than 100 employees were identified and 429 units responsible for the protection of whistle-blowers established. On internal control mechanisms, the number of inspections carried out by the Transparency and Anti-Corruption Unit of the Ministry of Interior increased. On access to information, the Commissioner for Information and Data Protection received 684 complaints and issued 36 decisions in 2016 while 560 complaints were received in 2017. A system was established to record the overall number of requests made to public institutions. The impact of anti-corruption measures in particularly vulnerable areas (customs, tax administration, education, health, public procurement etc.) remains limited. There is still a strong and urgent need to improve and strengthen internal checks and inspection mechanisms within the public administration and to improve their cooperation with law enforcement authorities. Institutional framework Prevention of corruption The capacity of the anti-corruption network in line ministries, at local level and in the Office of the National Coordinator against Corruption (NCAC) needs to be strengthened. Since September 2017, the Ministry of Justice serves as the new NCAC and structures are being put in place. Coordination between the latter and the Council of Ministers’ Unit for Transparency and Anti-Corruption has to be ensured. The role of HIDAACI in detecting conflicts of interest and checking asset declarations was strengthened with the adoption of the Law on whistle-blowing and whistle-blower protection and with the implementation of the Law on the transitional re-evaluation process. The latter provides for judges, prosecutors and legal advisers to undergo vetting. The number of inspectors at HIDAACI was increased from 20 to 28. Its administrative, technical and financial capacity needs to be further strengthened to cope with asset declaration checks. An online asset declaration system has yet to be established. The role of the High State Audit (HSA) in the overall anti-corruption framework has to be strengthened, in order to identify systematic weaknesses. The inspection capacity in public procurement needs to be further improved. E-procurement is expected to achieve more transparency and reduce opportunities for abuse. The Central Electoral Commission monitored the 2017 parliamentary elections and sanctions were issued for nearly all violations. New training curricula for public officials on good governance and combating corruption were introduced at the School of Public Administration. Integrity-related secondary legislation is in place but an overall integrity risk management system has yet to be established. No integrity plans have been developed for ministries. An online portal allows members of the public to submit complaints about corruption. Twenty-one cases were referred to the Prosecutor’s Office in 2016, and six in the first half of 2017. Complementarity with the newly created government platform on ‘co-governance with the public’ needs to be clarified.

Law enforcement Specialised anti-corruption bodies in charge of investigating, prosecuting and sanctioning corruption are in the process of being established. These include the SPAK, NBI and a Court to address high level corruption cases. The police and prosecution have been granted access to additional private and public national registries. However, an obstacle hampering the law enforcement authorities’ capacity to operate as well as the efficiency of investigations remains their lack of direct access to 20 key national registries. Concerns remain over high staff turnover and insufficient interinstitutional cooperation. The financial, human and technical resources of enforcement authorities need to be strengthened. Cooperation between police, prosecutors and the HSA and procurement services in fighting corruption should be strengthened. The police remain vulnerable to corruption and to political interference in operational activities, despite an increase in internal investigations. Legal framework Albania has ratified all relevant international conventions, but implementation remains uneven. Laws on excluding criminal offenders from public posts and protecting whistleblowers were adopted. Concealment of assets and falsification and non-declaration of assets by public officials have been made criminal offences. Only one recommendation made by the Council of Europe’s Group of States against Corruption in its latest evaluation report has been fully implemented. The nine others have been only partially implemented so far. Albania should prioritise their correct and swift implementation. To increase the efficiency of investigations, the legislative framework was amended in 2017. The time limit for investigations of corruption was extended from 3 to 6 months. Furthermore, amendments to the Law on Electronic Interception extended the scope of application of interceptions to include corruption offences and allow for the decentralisation of interception. However, the amendments did not provide for the recording of interceptions to be decentralised, allowing only for listening in real time at district level. Amended in April 2017, the Anti-Mafia Law now includes all passive and active corruption offences and defines the role of the prosecutor more clearly. Amendments to the Criminal Procedure Code introducing a clear definition of ‘high state official’ have yet to be adopted. The Law on the Declaration and Audit of Assets, Financial Obligations of Elected Persons and Certain Public Officials was amended in April 2017, increasing the independence of HIDAACI. The chair’s mandate was extended from 5 to 7 years and the requirement for the chair’s election in Parliament was increased to a three-fifths majority. The new law also prescribes that members of Parliament’s assets be audited every 2 years. However, according to the target dates set in the latest amendments to the law, the full operability of the online asset declaration system cannot not be ensured before 2022. This has to be addressed, in order to ensure that the system is up and running within a shorter timeframe. The latest amendments to the Law on Political Party Financing envisage the publication of financial reports on the election campaign of political parties, election campaign monitoring reports and financial audit reports. All the secondary legislation for the legal framework on integrity is in place but it remains highly complex and fragmented.

Strategic framework Implementation of the inter-sectoral strategy against corruption and its 2015-2017 action plan has further advanced. Implemented by the Ministry of Justice, a broad majority (86 %) of the envisaged actions were either entirely or partially implemented in 2016. The monitoring mechanism and its accountability need to be strengthened. Furthermore, 23 % of the amount needed for implementing the action plan is still missing and remains problematic. A comprehensive sound performance assessment framework is being finalised. The lack of staff and funding for implementing the measures and reporting on progress remains a concern. Fundamental rights Albania has ratified most international human rights conventions and developed its legal framework in line with European standards. New legislation has been adopted on children’s rights and the protection of minorities. However, the institutional mechanisms remain weak and more efforts are needed to implement existing commitments. Social care services for vulnerable groups, employment and living conditions for Roma and Egyptians need further improvements. Despite the efforts made, protection and enforcement of property rights has yet to be ensured. In the coming year, Albania should: ®improve institutional mechanisms for protecting children, protecting victims of domestic violence, and guarantee gender equality; ®step up efforts to establish solid anti-discrimination case-law; find a sustainable long-term housing and employment solution and tackle segregation in the education field for vulnerable groups, in particular for Roma and Egyptians; ®further consolidate the entrenchment of property rights, notably by advancing the revision of property deeds, implementation of the compensation scheme, and make the necessary progress on the digitalising and mapping of property. Albania complies with international human rights instruments and has ratified most international conventions. It has yet to ratify the Optional Protocol to the Convention on the Rights of Persons with Disabilities and the Optional Protocol to the International Convention on Economic, Social and Cultural Rights. Overall, the implementation of such instruments should be improved. Albania continued to ensure good cooperation with the European Court of Human Rights (ECtHR). Since September 2016, the European Court of Human Rights (ECtHR) has found violations of the European Convention on Human Rights (ECHR) in 6 cases relating mainly to the right to a fair trial. During the reporting period, 133 new applications were registered by the Court. On 1 February 2018, the total number of applications pending before the Court was 532. There are currently 25 cases against Albania under the enhanced supervisory procedure. On the promotion and enforcement of human rights, the Ombudsman has an A-status awarded by the Global Alliance of National Human Rights Institutions in 2014. During the reporting period, the Ombudsman continued to promote the rights of vulnerable groups as well as focusing on the implementation of the justice reform. In 2017, the Ombudsman submitted a total of 188 recommendations (out of which 123 were accepted, 29 rejected, 24 without response and 12 in process). In May 2017, a new Ombudsman was nominated by the Parliament, based on a political agreement between the two main parties and without fully completing all the steps foreseen in the consultation process. Owing to the current legal framework, and despite several attempts by the Ombudsman to propose amendments to the legislation, all five Commissioner positions at the Ombudsman’s Office remain vacant.

As regards the right to life, the Authority on Access to Information on the former State Security Service was established and a strategy was adopted in June 2017. However, the resolution and recommendations on blood feuds still require follow-up. Following a visit to the country in December 2016, the UN Working Group on Enforced or Voluntary Disappearances (WGEID) issued several recommendations to Albania to address the crimes committed during the communist dictatorship period. For instance, the WGEID recommended that Albania recognise the enforced disappearances of the past and guarantee non-repetition through an appropriate mechanism. It also called for the creation of a mechanism taking a global approach, instead of fragmented measures, to deal with prejudices resulting from the past political repression. The number of people who have been secretly abducted or imprisoned during the dictatorship remains unknown, but it is estimated that around 6 000 persons went missing. On the prevention of torture and ill-treatment, the National Preventive Mechanism conducted 124 inspections in 2017, resulting in 95 recommendations. During this period, 29 complaints of violence in police facilities and penitentiary institutions were processed. In October 2017 the Ombudsman launched criminal proceedings against a State Police officer on grounds of torture. However, the prosecutor's office decided not to initiate criminal proceedings. This case is related to the use of handcuffs on an offender hospitalised at Tirana’s prison hospital. The European Committee for the Prevention of Torture (CPT) visited the country in February 2017 and published a report. Particular attention was paid to the treatment and conditions of detention of persons in police custody and the situation of remand prisoners and forensic psychiatric patients. The recommendations issued by the CPT have not been implemented by the Albanian authorities. As regards the prison system, a strategic action plan to improve detention conditions was prepared in 2014 but its implementation has not been monitored. The release of 750 prisoners following the amnesty of January 2017 was not implemented in line with risk evaluations. The laws on prisons and prison police have yet to be amended to ensure compliance with European standards. During the reporting period, 22 prison directors were dismissed and the Prison Directorate Director was replaced four times. Several former managers are being charged and investigated for abuse of office and corruption. Furthermore, the verification and revaluation process of prison personnel has already achieved some preliminary results: disciplinary measures have been taken against 49 prison police officers and 65 other officers have been criminally prosecuted. The use of alternatives to custody increased compared to the previous reporting period (there were respectively 5 577 cases in 2016 and 6 046 in 2017, compared to 5 952 in 2015). The use electronic monitoring has also increased (39 cases in 2015, 187 in 2016 and 113 in 2017). The specialist monitoring of convicts by the Probation Service increased from 74 in 2016 to 84 in 2017. On the protection of personal data, the country has ratified the Council of Europe Convention for the Protection of Individuals with regard to the Automatic Processing of Personal Data and its additional protocol. The office of the Commissioner for the Right to Information and Data Protection increased its staff and training programme. The Commissioner received 120 complaints from data subjects, carried out 184 administrative inspections, issued 22 decisions and imposed 36 administrative sanctions in 2016. Further efforts should be made to align the personal data protection legislation with the General Data Protection Regulation and the Directive on the protection of natural persons. Freedom of thought, conscience and religion was generally upheld. In October 2016, the Parliament passed a resolution condemning communist regime crimes against religious persons. A special unit to tackle religious estate was established and property certificates for hundreds of religious buildings were delivered. However, the restitution of properties belonging to religious groups remains an issue. The government allocated EUR 740 000 to the five official religious communities in April 2017. The electricity fee for religious buildings was lowered and the capacity of the State Committee on Cults was increased. Freedom of expression The country has some level of preparation/is moderately prepared in the area of freedom of expression. There has been some progress in strengthening the independence of the regulatory authority and the public broadcaster. The overall legislative environment is conducive to the exercise of freedom of expression, but implementation remains a challenge. Legislation on public advertising, intended to improve transparency in line with international best practices, needs to be introduced. In the coming year, Albania should in particular: → bring ownership limitations for national operators into line with international standards; → introduce legislation in line with international best practice on public advertising to increase transparency; → enforce implementation of the Labour Code and strengthen the protection of Albanian journalists’ labour and social rights. Intimidation of journalists Physical assaults on journalists remain very rare. A case was reported in March 2017 and was swiftly condemned by the authorities. Investigations were launched and led to the perpetrator’s arrest. The case reached appeal level and is still ongoing. A TV programme was closed down and two journalists were dismissed following an investigative story involving a local official in October 2016, no official complaints were submitted. Three defamation court cases against nine journalists were registered. Cases are still ongoing and no convictions have been issued so far. The authorities are expected to pursue zero tolerance of threats or attacks against media, and refrain from making statements that may create an environment not conducive to freedom of expression. Legislative environment The Constitution and relevant laws are in line with international human rights law. They guarantee individual liberties including the right to privacy, freedom of expression and sanctions against incitement to hatred. Defamation remains a criminal offence, although prison sentences are not allowed. However, journalists are at risk of large fines and damages. The rules on hate speech are in line with international standards. Five cases of hate speech were registered and two complaints were submitted to the Commissioner for the Protection against Discrimination on the grounds of gender identity and sexual orientation. Albania still needs to introduce legislation strengthening transparency in public advertising. Access to information about procurement contracts, audits and salaries of officials should be strengthened. Decisions of the Commissioner for the Right to Information are nonbinding on public administration officials. Implementation of legislation/institutions The Audiovisual Media Authority (AMA) approved its 2017-2019 strategic action plan in March 2017. AMA has doubled its revenue and changed its structure to focus more strongly on supervisory and inspection activities to identify illegal broadcasting. The digital switchover has entered the final stage of implementation.

Public service broadcaster The public broadcaster RTSH has a new internal structure reflecting the digital switchover process. RTSH has developed and approved editorial principles to guard against political interference. The OSCE/ODIHR report on the June parliamentary elections stated that RTSH showed a balanced approach to campaign reporting. However, RTSH needs to ensure its financial sustainability. Economic factors Audiovisual media ownership and the transparency of media funding and public advertising remain key issues. The editorial direction of private media continues to be strongly influenced by political and business interests. Media funding remains key to improving media freedom, especially given new challenges such as ‘fake news’ and third-party influence. Among others, self-censorship and the precarious nature of employment for journalists remain issues of strong concern. Internet The government does not restrict internet access or censor online content. Self-regulation for the media sector has to be encouraged. Social dialogue/social conditions Job security for journalists needs to be strengthened. Media owners do not formalise work contracts and the Labour Code needs to be properly implemented for journalists. Freedom of assembly and association was respected. Protests and political demonstrations were held without major incidents. As regards property rights, progress has yet to be made towards improving the legal framework for registration, expropriation and compensation. The 2012-2020 strategy on property rights has yet to be updated and institutional coordination should be improved. In relation to the Manushaqe Puto case, reflecting the effectiveness of compensation schemes, there are 89 cases are pending before the ECtHR. The Integrated Land Management (ILMR) Secretariat was established. Further progress is dependent on the budget allocation for integrated land management and on follow-up legislation. The Agency for the Treatment of Property has received 887 applications so far where 183 decisions have been executed for evaluation of property. The policy and legal framework on non-discrimination is broadly in line with EU standards. However, the Law on Protection against Discrimination does not address multiple discriminations. Implementation of the legal framework needs to be strengthened through the specialised training of judges and prosecutors. In 2017, the Commissioner for Protection against Discrimination handled 203 cases of alleged discrimination (against 288 in 2015 and 239 in 2016). The Commissioner participated in 59 judicial proceedings (against 37 in 2015 and 45 in 2016) and imposed 13 penalties (against 14 in 2015 and 10 in 2016). Awareness campaigns were organised across the country, but homophobia and anti-gypsyism remain widespread. The number of reported hate-crime cases is very low and data collection on hate crimes is still lacking. The national strategy and action plan (2016-2020) on Gender Equality was adopted in October 2016. However, a certain funding gap persists. At the central level, the Deputy Prime Minister is assigned as the National Coordinator for Gender Equality mechanism. Regarding the legislative framework, a number of laws still contain gender-discriminatory provisions. In 2017, efforts were made to make gender equality an integral part of planning and budgeting for national development and EU integration, but these still need to be reflected at the local level. With the new government, 11 gender-champions employees were appointed at the central level and 58 at local level. Women are equally represented in the new government. The percentage of women parliamentarians also increased from 16 % to 28.5 % in the new parliament. In December 2017, the Parliament adopted a resolution on the fight against gender-based violence and established a parliamentary sub-committee on gender equality. Further efforts are required to ensure that all strategies and policies and strategies are gender mainstreamed. Domestic violence remains a serious concern. During 2017, 3 243 cases were reported (against 3 700 in 2016) and 2 593 protection orders were issued (against 2 207 in 2016). For 2017, 129 of these protection orders were not respected (against 119 in 2016). Furthermore, 1 950 cases of domestic violence against women and children were registered as criminal offences in 2016. While the number of local mechanisms for reporting gender-based violence has increased, efforts should be stepped up to establish them in all municipalities. The Ministry of Justice established a new office to coordinate efforts against domestic violence. There is also a need to ensure cross-sectoral coordination with child protection and antitrafficking mechanisms at local and regional level. Since December 2016, a donor-funded national emergency number for victims of domestic violence has been operational. Overall, more work is needed to ensure that women have access to justice. The legislative and policy framework on the rights of the child was reinforced in 2017 with the adoption of the Law for the Protection of Children’s Rights, the Criminal Justice for Children Code and the ‘Children’s Agenda 2020’. The Law for the Protection of Children’s Rights provides for a child protection system. However, related bylaws are needed to make it operational. Interinstitutional cooperation, data collection and reporting mechanisms on child protection should be improved. Further efforts are also needed to ensure the child protection system functions effectively. In 2016 and up to June 2017, 586 street children and their families were taken into protection. The Criminal Justice for Children Code in March 2017 ensured Albania’s de jure compliance with international standards on juvenile justice. The code needs to be completed with secondary legislation. The adoption of the ‘Justice for Children’ strategy, encompassing both juvenile justice and equitable access to justice for children, is still pending. The Law on Legal Aid adopted in December 2017 aims to ensure children’s access to legal aid. The Ministry of Justice has established a section on criminal justice for children and developed an o