EUROPEAN COMMISSION Brussels, 6.10.2020 SWD(2020) 352 final COMMISSION STAFF WORKING DOCUMENT Serbia 2020 Report Accompanying the Communication from the Commission to the European Parliament, the Council, the European Economic and Social Committee and the Committee of the Regions 2020 Communication on EU Enlargement Policy





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Table of Contents 1.Introduction 1.1 Context 1.2 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 2.2.2Chapter 24: Justice, freedom and security 3.Fundamentals first: economic development and competitiveness 3.1.The existence of a functioning market economy 3.2.The capacity to cope with competitive pressure and market forces within the EU 4.Good neighbourly relations and regional cooperation 5.Normalisation of relations between Serbia and Kosovo 6.Ability to assume the obligations of membership 6.1.Chapter 1: Free movement of goods

6.2.Chapter 2: Freedom of movement for workers 6.3.Chapter 3: Right of establishment and freedom to provide services 6.4.Chapter 4: Free movement of capital71 6.5.Chapter 5: Public procurement73 6.6.Chapter 6: Company law75 6.7.Chapter 7: Intellectual property law76 6.8.Chapter 8: Competition policy77 6.9.Chapter 9: Financial services79 6.10.Chapter 10: Information society and media81 6.11.Chapter 11: Agriculture and rural development83 6.12.Chapter 12: Food safety, veterinary and phytosanitary policy84 6.13.Chapter 13: Fisheries85 6.14.Chapter 14: Transport86 6.15.Chapter 15: Energy88 6.16.Chapter 16: Taxation90 6.17.Chapter 17: Economic and monetary policy91 6.18.Chapter 18: Statistics92 6.19.Chapter 19: Social Policy and employment94 6.20.Chapter 20: Enterprise and industrial policy97 6.21.Chapter 21: Trans-European networks98

6.22.Chapter 22: Regional policy and coordination of structural instruments99 6.25.Chapter 25: Science and research101 6.26.Chapter 26: Education and culture102 6.27.Chapter 27: Environment and climate change104 6.28.Chapter 28: Consumer and health protection108 6.29.Chapter 29: Customs union112 6.30.Chapter 30: External relations113 6.31.Chapter 31: Foreign, security and defence policy114 6.32.Chapter 32: Financial control117 6.33.Chapter 33: Financial and budgetary provisions119 Annex I – Relations between the EU and Serbia121



1.Introduction 1.1 Context The European Council granted Serbia the status of candidate country in 2012. Since the opening of Serbia’s accession negotiations in January 2014, 18 out of 35 chapters have been opened, two of which provisionally closed. In 2019, two negotiation chapters were opened. The overall pace of negotiations will continue to depend in particular on a more intense pace of rule of law reforms and on the normalisation of Serbia’s relations with Kosovo. The Stabilisation and Association Agreement (SAA) between Serbia and the EU entered into force in September 2013. Serbia continued to implement the SAA, although a number of compliance issues remain. The Serbian government continued to declare European integration as its strategic goal. However, several statements were initially made by high-ranking officials in the context of the COVID-19 crisis, which were not in line with this strategic commitment. Notwithstanding its latest more positive signals towards the EU, the Serbian authorities overall need to place more emphasis on objective and unambigious positive communication on the EU, which is Serbia’s main political and economic partner. The COVID-19 pandemic is a global shock that has not spared the Western Balkans. It represents an unprecedented burden on their health and social protection systems. The final extent of its footprint in terms of loss of human lives and damage to the economies is still difficult to assess, but early estimates foresee a drop of between 4-6% of gross domestic product (GDP) in the region. Thousands of citizens are at risk of losing their jobs, and temporary government support measures (unemployment benefits, deferrals/waivers to tax and social security contributions, etc.) have an important fiscal impact. While the EU is itself heavily affected by the pandemic, it has spared no time and effort to provide essential and unparalleled support to the Western Balkans. This includes financial support of more than EUR 3.3 billion for countries in the region to address the immediate health crisis and resulting humanitarian needs, as well as longer term and structural impact on their societies and economies. Given the European perspective of the Western Balkans, the EU is also treating the region as privileged partners by associating them with the Union’s mechanisms and instruments. These include the Health Security Committee, Joint Procurement Agreements, Union Civil Protection Mechanism, Solidarity Fund, consular assistance in repatriation or exemption from temporary EU export restrictions of medical equipment. These and other measures have provided immediate relief and are a clear message of the EU’s political commitment towards the region.

The Serbian government announced two financial packages in the total worth of EUR 5.7 billion to support the economy through the COVID-19 crisis. The packages contained earmarked budget funds for direct cash subsidies to the private sector, for a programme of favourable loans and for state guaranteed loans. Additional financial aid through support schemes was announced for particularly affected sectors, such as tourism and transport. Furthermore, the government paid a minimum salary for employees of small and medium enterprises for three months and deferred the payment of taxes and social security contributions. The latter two measures were prolonged in July 2020 for another month and were complemented by the establishment of a new programme granting state support for each newly created job for the period of nine months. All citizens over 18 were offered a EUR 100 cash transfer. Serbia pledged EUR 2 million at the EU’s international conference of May 2020 to help develop and ensure equitable access to COVID-19 vaccines, tests and treatments. The president, prime minister and speaker of parliament declared a state of emergency on 15 March. The authorities aligned their actions to deal with the pandemic with World Health Organisation (WHO) recommendations and imposed wide-ranging temporary measures, including strict curfew hours, closure of schools and universities, bans on public gatherings, freezing of most air traffic and closing of borders. The parliament only convened just over six weeks after the state of emergency was called, which limited its ability to scrutinise the executive during this period. After the state of emergency was lifted on 29 April, the country held elections on 21 June and several precautionary measures were lifted. Amid a rising number of coronavirus cases in early July, the President announced the reintroduction of a stricter curfew. This led to protests in Belgrade and several other cities, during which protestors expressed dissatisfaction with the government’s handling of the pandemic and wider concerns over the state of democracy in Serbia. Protests turned violent in some places and several clashes erupted between police forces and some of the protestors. The EU reminded the authorities that, while protecting people’s lives and health should be the first priority and public order must be guaranteed, any use of force must be measured and proportionate at all times. 1.2 Summary of the report As regards the political criteria, the parliamentary, provincial and municipal elections in Serbia initially foreseen for April were postponed following the outbreak of the COVID-19 pandemic and held on 21 June 2020. While contestants were able to campaign and fundamental freedoms were respected, voter choice was limited by the governing party’s overwhelming advantage and the promotion of government policies by most major media outlets, according to the Organisation for Security and Co-operation in Europe/Office for Democratic Institutions and Human Rights (OSCE/ODIHR). Numerous recommendations previously made by ODIHR remain unaddressed. It is crucial that the Serbian authorities address long-standing electoral shortcomings through a transparent and inclusive dialogue with political parties and other relevant stakeholders well ahead of the next elections. A number of opposition parties boycotted the elections. The newly constituted Serbian parliament is marked by the overwhelming majority of the ruling coalition and the absence of a viable opposition, a situation which is not conducive to political pluralism in the country. During the previous legislature, some steps were taken to address shortcomings in the work of the parliament with the reduction of urgent procedures and previous practices of filibustering. Several opposition parties continued their boycott of parliamentary sessions. Inflammatory language against political opponents and representatives of other institutions expressing diverging political views was used during parliamentary debate. The effectiveness, independence and transparency of the parliament, including the role and prerogatives of the parliamentary opposition, need to be strengthened to ensure the necessary checks and balances indispensable in a democratic parliament. The new parliament and political forces should continue to engage in the inter-party dialogue led by the European Parliament, with a view to improving parliamentary standards and forging broad cross-party and societal consensus on EU-related reforms, which is vital for the country’s progress on its EU path. Serbia is moderately prepared in the area of public administration reform. No progress was made overall as the excessive number of acting senior manager positions was not sizeably reduced. Lack of transparency and respect of the merit-based recruitment procedure for senior civil service positions is an issue of increasingly serious concern. The effective implementation of the law on the planning system needs to be ensured through a strong quality control of the Public Policy Secretariat. Serbia’s judicial system has some level of preparation. No progress was made over the reporting period. The constitutional reform on the judiciary was put on hold until after the 2020 parliamentary elections. This delay has repercussions on the adoption of related judicial legislation that is needed to increase safeguards for judicial independence. The scope for continued political influence over the judiciary under the current legislation is a serious concern. Serbia continued its efforts to reduce old enforcement cases and harmonise court practice. Serbia has some level of preparation in the fight against corruption. Limited progress was made over the reporting period. Operational steps have been taken to strengthen the mandate and to ensure the independence of the Anti-Corruption Agency, as well as to enhance its capacities with a view to implementing the law on the prevention of corruption upon its entry into force in September 2020. The changes brought by the law on the organisation and jurisdiction of government authorities in suppression of organised crime, terrorism and corruption, in force since March 2018, produced some results in terms of finalised cases. Overall, corruption remains an issue of concern. There is still no effective prevention coordination mechanism in place. The number of finalised high-level corruption cases has decreased compared with the previous years. Serbia needs to increase its efforts and step up the prevention and repression of corruption. In the fight against organised crime, Serbia has some level of preparation with limited progress over the reporting period related notably to structural reforms and interagency cooperation. Serbia is stepping up its cooperation with Europol. Overall, Serbia has yet to establish a convincing track record of effective investigations, prosecutions and final convictions in serious and organised crime cases, leading to an increased amount of confiscated assets. Serbia needs to increase its efforts in dismantling large and internationally active criminal organisations. The legislative and institutional framework for upholding fundamental rights is broadly in place. However, its consistent and efficient implementation still needs to be ensured. Human rights institutions need to be strengthened and their independence guaranteed, including via the allocation of the necessary financial and human resources. Serbia has adopted a new media strategy, which was drafted in a transparent and inclusive manner and identifies the main challenges related to media freedom in Serbia. However, implementation of the new strategy has not yet started and no progress was made yet on the ground to improve the overall environment for freedom of expression. As identified in the media strategy, cases of threats, intimidation and violence against journalists are still a source of serious concern. Transparency of media ownership and of allocation of public funds, especially at local level, has yet to be established. ODIHR found that most TV channels with national coverage and newspapers promoted government policy during the electoral campaign. It also found that the few media outlets which offered alternative views had limited outreach and provided no effective counterbalance, which compromised the diversity of political views available through traditional media, through which most voters receive information. Serbia continued to significantly contribute to the management of the mixed migration flows towards the EU by playing an active and constructive role and cooperating effectively with its neighbours and EU Member States. It also continued to effectively implement the integrated border management strategy and its action plan. On the economic criteria, Serbia made some progress and is moderately prepared/at a good level of preparation in developing a functioning market economy. Prior to the COVID-19 crisis, the pace of GDP growth picked up as domestic demand strengthened. External imbalances widened but their financing remained healthy due to high inflows of foreign direct investment. Price pressures remained subdued and inflation expectations contained. By reducing the budgetary deficit and maintaining a prudent fiscal stance, Serbia has significantly improved debt sustainability. Labour market performance has improved, with the lowest unemployment rates in the last decade; however, this was also due to large-scale emigration. The COVID-19 crisis is however projected to strongly deteriorate the economic outlook in 2020, in particular as regards GDP growth, public finances and employment. While some progress has been made in the reforms of the tax administration and the privatisation of state-owned banks, other structural reforms of public administration and state owned enterprises advanced slowly. Weaknesses in the budgetary framework need to be addressed. There has been no progress in strengthening the fiscal rules. The state retains a strong footprint in the economy and the private sector is hampered by weaknesses in the rule of law. Serbia made some progress and is moderately prepared to cope with competitive pressure and market forces within the EU. The structure of the economy improved further and economic integration with the EU remained high. However, despite some progress, the quality and relevance of education and training does not fully meet labour market needs. Investment has continued to increase but, after years of underinvestment, remains insufficient to address serious infrastructure needs. Serbia needs to apply the same rules for prioritising, selecting and monitoring all capital investments regardless of the type of investment or the source of financing, including those under intergovernmental agreements. All investment decisions need to follow EU standards on public procurement, state aid, environmental impact assessments and cost-benefit analysis. Although the cost of borrowing for small and medium-sized enterprises has declined recently, they still face a number of challenges, including a volatile business environment and unfair competition. Serbia overall remained committed to bilateral relations with other enlargement countries and neighbouring EU Member States and an active participant in regional cooperation. Relations with Montenegro have been marked by tensions, including concerning the 30 August parliamentary elections in Montenegro. Serbia demonstrated its commitments to provide a renewed impetus to regional cooperation and enhanced regional ownership at the summits in Novi Sad, Ohrid and Tirana. It is important that regional initiatives include all partners in the Western Balkans and are based on EU rules, building on commitments previously taken in the framework of CEFTA, the Regional Economic Area (REA) or the Transport Community Treaty. Regarding the normalisation of relations with Kosovo, the EU-facilitated dialogue resumed with high-level meetings on 12 and 16 July, and 7 September 2020. A number of expert level meetings took place in Brussels. Serbia needs to make further substantial efforts and contribute to reaching a comprehensive legally binding agreement with Kosovo. Such an agreement is urgent and crucial so that Kosovo and Serbia can advance on their respective European paths. As regards its ability to assume the obligations of membership, Serbia stepped up its work to align legislation with the EU acquis in the economic and internal market chapters. The country made good progress in economic areas such as company law, intellectual property law, competition and financial services. However, limited progress was made on public procurement. Even though Serbia aligned significant parts of its public procurement legislation with the acquis, a law on special procedures for linear infrastructure projects, adopted in February 2020, allows exemption of infrastructure projects of “special importance” for Serbia from the application of public procurement rules and, thus, allows for the circumvention of EU rules and standards. Especially the implementation of intergovernmental agreements concluded with third countries do not seem to be systematically in line with the principles of equal treatment, non-discrimination, transparency and competition and neither fully consistent with the relevant EU acquis and national legislation. Environment and climate change need to receive adequate political attention, translating into better coordination, stronger institutions, more financing and mainstreaming across all sectors of the economy. Advancing on a green energy transition, away from coal, needs to become a priority, and a part of Serbia redoubling its efforts to fight air pollution. Regarding transport, Serbia continued with rail reforms. Transport investment decisions need to ensure best value for money. Adequate financial and human resources and sound strategic frameworks will be crucial for the pace of reforms, including in particular the appointment of a head of Serbia’s EU negotiating team. Serbia continued to develop intense relations and strategic partnerships with a number of countries worldwide, including Russia, China and the US. Cooperation with China increased during the COVID-19 crisis and was marked by pro-China and EU sceptical rhetoric by high-ranking state officials. Frequent high-level contacts and regular bilateral visits with Russia were maintained as well as military technical cooperation, including joint military drills and arms trade arrangements. The President of Serbia pledged to move the Serbian embassy in Israel to Jerusalem by July 2021. Serbia aligned with 60% of the EU CFSP positions in 2019 and needs to step up its efforts in order to progressively align its foreign and security policy with that of the European Union in the period up to accession.

1.3 State of play of the accession negotiations 9 Remaining chapters without opening benchmarks 4 Draft EU common position in Council 2 – Freedom of movement for workers 3 – Right of establishment & freedom to provide services 14 – Transport policy 21 – Trans European Networks 1 Serbia presented its Negotiating Position, COM prepares Draft EU common position 27 – Environment 2 Serbia invited to present its Negotiating Position 10 – Information society and media 28 – Consumer and health protection 1 Screening reports still discussed in Council working group 31 – Foreign, Security and Defence Policy 1 34 – Institutions – Currently not applicable for Serbia 8 Remaining chapters with opening benchmarks 2 Opening benchmarks assessment reports discussed in Council working group 11 – Agriculture and rural development 22 – Regional policy & coordination of structural instruments 6 Serbia working on fulfilment of opening benchmarks 1 – Free movement of goods 8 – Competition policy 12 – Food safety, veterinary and phytosanitary policy 15 – Energy 16 – Taxation 19 – Social policy and employment 16 Chapters opened (in total 18) – date Serbia working on fulfilment of interim or closing benchmarks 4 – Free movement of capital – 10/12/19 5 – Public procurement – 13/12/16 6 – Company law – 11/12/17 7 – Intellectual property law – 20/06/17 9 – Financial services – 27/06/19 13 – Fisheries – 25/06/18 17 – Economic and monetary policy – 10/12/18 18 – Statistics – 10/12/18 20 – Enterprise and industrial policy – 27/02/17 23 – Judiciary and fundamental rights – 18/07/16 24 – Justice, freedom, security – 18/07/16 29 – Customs Union – 20/06/17 30 – External relations – 11/12/17 32 – Financial control – 14/12/15 33 – Financial and budgetary provisions – 25/06/18 35 – Other issues / Normalisation with Kosovo – 14/12/15 + 2 Chapters opened and provisionally closed 25 – Science and research (opened and closed at 13/12/16) 26 – Education and culture (opened and closed at 27/02/17) 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 reporting period was marked by deep political polarisation, in particular in the context of parliamentary, provincial and municipal elections on 21 June 2020. While elections were administered efficiently, the dominance of the ruling party, including in the media, was of concern. A number of opposition parties boycotted the elections despite efforts led by the European Parliament to create cross-party consensus on electoral reforms, citing democratic concerns and an uneven playing field. The newly constituted Serbian parliament is marked by the overwhelming majority of the ruling coalition and the absence of a viable opposition, a situation which is not conducive to political pluralism in the country. Following the outbreak of the COVID-19 crisis, a state of emergency was declared on 15 March by a joint decision of the president, prime minister and speaker of parliament. The authorities imposed wide-ranging measures restricting fundamental freedoms, including strict curfew hours. The adequacy and proportionality of some of these measures were disputed by several domestic and international organisations. The parliament only convened just over six weeks after the state of emergency was called, which limited its ability to scrutinise the executive during this period. The state of emergency was approved by parliament on 28-29 April and lifted a week later. Following that, the country held elections on 21 June and several precautionary measures were lifted. Amid a rising number of coronavirus cases in early July, the President announced the reintroduction of a stricter curfew. This led to protests in Belgrade and several other cities, during which protestors expressed dissatisfaction with the government’s handling of the pandemic and wider concerns over the state of democracy in Serbia. Protests turned violent in some places and several clashes erupted between police forces and some of the protesters. The EU reminded the authorities that, while protecting people’s lives and health should be the first priority and public order must be guaranteed, any use of force must be measured and proportionate at all times. Elections The parliamentary, provincial and local elections initially foreseen for April were postponed to 21 June 2020 following the COVID-19 crisis. While contestants were able to campaign and fundamental freedoms were respected, voter choice was limited by the governing party’s overwhelming advantage and the promotion of government policies by most major media outlets, according to the Office for Democratic Institutions and Human Rights at the Organisation for Security and Cooperation in Europe (OSCE/ODIHR). Numerous recommendations previously made by ODIHR remain unaddressed. It is crucial that the Serbian authorities address long-standing electoral shortcomings in a transparent and inclusive dialogue with political parties and other relevant stakeholders well ahead of the next elections. The elections of 21 June were characterised by intense political polarisation, amidst a boycott by most of the opposition. With 48.9%, voter turnout was lower than in previous parliamentary elections (2016: 56%). Only three lists passed the 3% threshold: The Serbian Progressive Party (SNS), led by the Serbian President, with 60.65% of the vote (188 of the 250 seats in parliament); SNS’ coalition partner, the Socialist Party of Serbia, with 10.38% (32 seats), and the Patriotic Alliance of Serbia with 3.83% (11 seats). Four parties representing national minorities, which are exempt from the threshold, obtained overall 19 seats. Despite travel and other restrictions, ODIHR deployed a special election assessment mission, upon the invitation of the Serbian authorities. ODIHR found that parliamentary elections were administered efficiently, despite challenges posed by the COVID-19 pandemic, but the dominance of the ruling party, including in the media, was of concern. On election day, procedures were generally followed, but ODIHR observers noted cases and received reports of violations of the campaign silence that benefitted the ruling party. Local observers found irregularities and incidents in 8-10% of the polling stations, an increase compared with previous elections. The official campaign period started on 4 March but was suspended during the state of emergency. The campaign, including calls for a boycott, remained overall low-key and focused on recovery from the COVID-19 pandemic, while EU accession and related reforms did not feature as main topics. Physical campaigning was limited and most of the campaign took place in the traditional media of TV and print, as well as in online media and on social networks. During the electoral campaign, ODIHR found that most TV channels with national coverage and newspapers promoted government policy, and the few media outlets offering alternative views have limited outreach and were therefore unable to provide an effective counterbalance. Another aspect noted by ODIHR was the meshing of the SNS’s campaign with media coverage of the president and the government’s response to the COVID-19 crisis. The dual role of the president as chairperson of the ruling party and nominal ‘bearer’ of its electoral list blurred the line between his official duties and the election campaign. Ahead of the elections, some steps were taken to improve electoral conditions in the context of a European Parliament-led dialogue between the ruling and several opposition parties. Subsequently, the government adopted decisions amongst others aiming to improve the accuracy and transparency of voting lists, to strengthen the work of the electoral administration, and to clarify conditions for the work of election observers. Legislative amendments were adopted in December 2019 to clarify provisions on prohibiting the use of public resources for electoral campaign purposes. This work was taken forward by the government working group on elections, established in August 2019. A parliamentary supervisory board, charged with the overall monitoring of the campaign, was established. The three vacant posts in the Council of the Regulatory Body for Electronic Media (REM), which has a key role in supervising the electronic media, were filled and two members replaced. REM adopted rules supplementing the legal framework for media conduct during elections, but these rules were not mandatory for private broadcast media, which raised questions given the perceived bias of the broadcast media overall. Despite the availability of a range of media monitoring efforts which would have allowed for scrutiny, ODIHR found that both the parliamentary supervisory board and the REM remained passive in supervising media conduct during the campaign period. In the final phase of the campaign, the REM banned several election-related ads. In February 2020, the ruling coalition proposed the lowering of the electoral threshold from 5% to 3% and a formula for enhanced representation of national minority lists. These key amendments were passed in parliament in a swift manner and without prior consultations, limiting the inclusiveness of the process. European standards (e.g. the Venice Commission code of good practice) provide that the fundamental elements of electoral law should not be significantly amended less than one year before an election. During the same parliamentary session, at the request of an opposition member, changes were introduced to increase the minimum quota for the less represented gender from 33.3% to 40% on election lists. In May 2020, legislative changes were adopted amending the rules for the certification of signatures necessary to support the election lists. While the legal framework enables democratic elections to be held, numerous of the recommendations previously made by ODIHR remain unaddressed, including areas such as election administration, media, campaign finance, dispute resolution and sanctions for electoral violations. Amongst other issues, the campaign finance regulatory framework still does not ensure transparency of campaign finance and the effectiveness of oversight. Work on meeting all ODIHR recommendations should start immediately in a transparent and inclusive manner, to make use of the period between elections for a comprehensive and inclusive review of the electoral framework. Parliament The newly constituted Serbian parliament is marked by the overwhelming majority of the ruling coalition and the absence of a viable opposition, a situation which is not conducive to political pluralism in the country. Following the outbreak of the COVID-19 pandemic, the parliament only convened just over six weeks after the state of emergency was called, which limited its ability to scrutinise the executive during this period. The new parliament and political forces should continue to engage in the inter-party dialogue led by the European Parliament, with a view to forging broad cross-party and societal consensus on EU-related reforms, which is vital for the country’s progress on its EU path.

Overall, parliamentary oversight of the executive remains rather formalistic and, thus, the democratic accountability of the executive branch is weak. This trend was accentuated following the outbreak of the COVID-19 pandemic, which tilted the democratic balance of power further towards the government. The parliament’s ability to scrutinise the executive, in particular to oversee the emergency measures introduced by the government, was limited during the state of emergency. Most opposition members continued their boycott of parliament sessions throughout the reporting period, and, in September 2019, announced a boycott of the upcoming parliamentary elections. Some steps were taken during the previous legislature to address shortcomings in the parliament’s work. Urgent parliamentary procedures were used for 19% of legislative procedures between 1 March 2019 and 31 March 2020 compared with 44% during a similar timeframe a year ago. Previous filibustering practices were significantly reduced. The 2020 budget was adopted with more time for debate than in the previous year. For the first time since 2014, the plenary discussed the annual reports of independent bodies and adopted conclusions. Six public hearings were held in 2019 (compared with one in 2018), and five question and answer sessions with the executive were held in 2019 (five in 2018). Committees held regular reviews and hearings on the work of relevant ministries. However, more systematic support for the work of independent regulatory bodies needs to be provided, by regularly monitoring the implementation of their recommendations and holding the executive bodies accountable. Inflammatory language against political opponents and representatives of other institutions expressing diverging political views was used during parliamentary debates. This included verbal attacks, amplified by some media, against a member of the European Parliament leading the inter-party dialogue. All politicians have a responsibility to avoid inflammatory language and to counter hate speech. The newly constituted parliament and political forces should continue to engage in the inter-party dialogue, with a view to creating an atmosphere of societal dialogue and cross-party consensus on EU-related reforms. The rules of procedure should be amended and a code of conduct adopted, in line with best practices and with EU expertise. The effectiveness, independence and transparency of the parliament, including the role and prerogatives of the parliamentary opposition, need to be strengthened to ensure the necessary checks and balances indispensable in a democratic parliament. The opposition also has a responsibility to make full use of the inter-party dialogue and put forward constructive proposals, thereby representing the interests of their constituents. The parliament continued to hold debates on Serbia’s negotiating positions as regards EU accession chapters as well as exchanges with the core negotiating team and with the National Convention on the European Union. Some 97 out of the 250 members of the newly constituted parliament are women. Changes were introduced to increase the quota for the less represented gender from 33.3% to 40% on election lists. Governance The Serbian government continued to declare EU membership as its strategic goal. However, several statements were initially made by high-ranking state officials in the context of the COVID-19 crisis, which were not in line with this strategic commitment. Notwithstanding its latest more positive signals towards the EU, the government overall needs to place more emphasis on objective and unambigious positive communication on the EU, which is Serbia’s main political and economic partner. Furthermore, political focus and human and financial resources on EU accession need to increase. A new head of the EU negotiating team should be appointed as a matter of urgency. The Serbian negotiating team saw substantial turnover of staff, which had a negative impact on its capacity to fulfil its coordinating role. Adequate human and financial resources will need to be allocated across all institutions involved so Serbia can meet its objectives as regards EU accession negotiations. The head of the negotiating team resigned in September 2019 and a new one needs urgently to be appointed. Consultations continued with relevant stakeholders, including civil society organisations (CSOs), through the National Convention on the EU. However, the inclusiveness and transparency of the reform process, in particular on issues related to EU accession, need to be improved as a matter of priority and public consultations on policies and legislation need to be more substantive. The role of independent bodies needs to be fully acknowledged and their recommendations followed up promptly. Monitoring of the implementation and impact of the reform processes needs to be further improved. Authorities should put more emphasis on objective communication about the EU, as Serbia’s main political and economic partner. Serbia’s strategic choice of EU accession needs to be communicated more pro-actively and unambiguously in public debate. Further efforts are needed to promote EU values in Serbian public debate and in education, including readiness for reconciliation. Regarding local self-government, the law on Vojvodina’s financing resources has yet to be adopted as provided for under the Constitution. Local administrative capacity is still weak and significant disparities between municipalities persist. Responsibilities still continue to be borne at local level without proper analysis of the capacity and human/financial resources required. The few local governments which were run by opposition parties have reported continued political pressures by ruling party authorities. Constitutional changes are still needed in some areas to address issues relevant to the accession negotiations. Civil society While some steps were initiated in terms of issuing guidelines and planning of consultations, further efforts are still needed to ensure systematic cooperation between the government and civil society. An enabling environment for the development and financing of civil society still needs to be established on the ground. An empowered civil society is a crucial component of any democratic system and should be recognised and treated as such by state institutions. CSOs and human rights defenders continued to raise awareness about civil and political rights. This takes place in an increasingly polarised environment that is not open to criticism, with the authorities making negative statements, echoed by some media, about CSOs in general and on the funding of certain associations in particular. These statements are made, for example, in the context of smear campaigns or in parliamentary debates. Organisations and individuals that criticise the authorities in developments related to the rule of law are under particular pressure. Harsh criticism against human rights defenders has continued in tabloid newspapers and intensified in the period preceding the parliamentary elections. In July 2020, a list containing the names of CSOs and media reportedly subject to a risk assessment by the Administration for the Prevention of Money Laundering (APML) was leaked to the public. The applicable legal basis for the APML’s actions, and the compliance of the APML with the recommendations of the FATF will need to be clarified (See Chapter 4 – Free Movement of Capital and Chapter 24 – Justice, Freedom and Security).). A national strategy and action plan to help create a positive environment for CSOs have still not been adopted. A council for civil society cooperation has yet to be set up. The National Convention on the EU (composed of representatives of governmental bodies, political parties, non-governmental organisations, experts, trade unions, private sector organisations and representatives of professional organisations), whose goal is to contribute to a structured debate on Serbia’s accession to the EU, has continued to monitor and assess the progress of accession negotiations. The authorities should use its expertise more systematically, in order to benefit from the full potential of the Convention and its working groups. In January 2020, the government adopted guidelines on the inclusion of CSOs in working groups for drafting regulations and public policies. The government’s office for cooperation with civil society created a database of ‘CSO focal points’ in public institutions and local self-governments. The use of the urgent procedure for adopting laws was reduced, potentially allowing for more time for consultations in the law-making process. However, a number of CSOs have reported that the time given for public consultations was still too short, or that their comments on draft laws were not given sufficient consideration and follow‑up.

For the first time, all public administration bodies were obliged in 2019 to submit an annual plan as regards public calls for financing CSOs to the office for cooperation with civil society, which then published an e-calendar of public calls. The implementation in practice of such annual plans needs to be monitored. The criteria for public financial support for CSOs need to be better defined and implemented to ensure overall transparency, especially at local level. Due to the COVID-19 pandemic and reallocation of funds under the state of emergency, several grant procedures for CSOs, at state and local level, have been suspended. 2.1.2. Public administration reform Serbia is moderately prepared with the reform of its public administration. It has developed further e-services delivery. However, no progress was made on the three Commission recommendations of last year, which therefore remain valid. There was no sizeable reduction of the excessive number of acting senior manager positions. The law on the planning system and its implementing legislation started being applied. However, line institutions need to further take into account the quality control role of the Public Policy Secretariat, whose opinions are mandatory – meaning that the Secretariat must be consulted – but not legally binding, as there is no mechanism to verify that the Secretariat’s comments have been incorporated and that the final draft versions of laws and policy documents are compliant with the legislation. Despite the adoption of a decree on capital projects management, the recommendation to develop a single mechanism for prioritising all investments regardless of the type and source of financing still needs to be fully addressed. There is an urgent need to address all those persisting shortcomings. In the coming year, Serbia should in particular: ®start recruiting senior civil servants effectively through a merit-based procedure and reduce the excessive number of acting positions; ®ensure a strong quality control role of the Public Policy Secretariat to allow for the effective implementation of the law on the planning system; ®put in place a unified, comprehensive and transparent system for capital investment planning and management. Strategic framework for public administration reform Serbia continued implementing its public administration reform (PAR) strategy and action plan as well as its public financial management (PFM) reform programme. A new PAR strategy, for 2021–2030, is being prepared and aims to further streamline the sector strategic framework, including the public financial management programme, and multiple underlying strategic documents. The government ensures regular monitoring and reporting on the implementation of reforms, but a coordinated monitoring and reporting system, which also covers managerial accountability, is yet to be set up (see Chapter 32 – Financial Control). CSOs continue to take part in the monitoring of reforms. Political support for public administration reform is in place through the PAR Council, chaired by the Prime Minister. However, only two meetings of the PAR Council were held during the reporting period. Consistency between appropriations in the budget, the medium-term expenditure framework and costing of the overall PAR strategic framework improved. Financial sustainability is still a concern due to reliance on donor funding. Policy development and coordination Institutions remain in place for a central government policy-making system, including for the European integration process, but weaknesses persist due to the continuing focus on formal and procedural issues. The strategic planning system, regulated through the law on the planning system, sets out clear rules for developing, monitoring and reporting on sector strategies. In that context, the effectiveness of quality control by the Public Policy Secretariat, including on the costing of strategies and their links to medium-term fiscal planning, has yet to be demonstrated. This is because the Secretariat’s opinions addressed to line institutions are mandatory – meaning that the Secretariat must be consulted – but not legally binding. There is no mechanism to verify that the Secretariat’s comments have been incorporated and that the final draft versions of laws and policy documents are compliant with the legislation. The full implementation of the law on the planning system will be further assessed when the majority of the current strategic documents expire, and new ones will need to be prepared under the new methodology described in the law. A unified information system, envisaged by the law on the planning system, has yet to carry out its intended function in the overall policy planning system. Namely, all new – since the entry into force of the above law - policy documents and their monitoring indicators will need to be entered in the unified information system, and subsequent reporting will also need to be carried out in that system. Mid-term plans for 2020, which were legally required to be adopted by all institutions by the end of January 2020, were only adopted by three institutions. The national plan for the adoption of the acquis (NPAA) and the government annual work programme need to be better synchronised. The capacity for inclusive and evidence-based policy and legislative development, including when aligning with the EU acquis, still needs strengthening. Administrative data collection and its systematic use for policy and law-making has yet to improve across the administration. The methodology on impact assessments, as well as the obligation for line institutions to take into account the Public Policy Secretariat’s opinion prior to submitting documents to the government, have yet to be consistently applied in practice. Regulatory impact assessments need to be systematically submitted to the parliament together with legislative proposals. Better coordination between the Ministry of Finance and the Public Policy Secretariat has yet to be established to ensure that there are no discrepancies between financial impact assessments, which the Ministry of Finance coordinates, and financial information in the regulatory impact assessments. Regarding inter-ministerial consultations, official high-level mechanisms still do not exist for resolving possible conflicts between services. The regulatory framework for public consultations requires that such consultations are organised early in the policy-making process, and sets detailed instructions on reporting publically on the outcome of the consultations. The scope of public consultations has improved. However, their impact and consistent application will need to be assessed in practice (See Civil society). As regards public scrutiny of government work, planning system regulations require the government and ministries to prepare and publish monitoring reports on the implementation of strategic documents. Measuring achievements against stated objectives rather than reporting on implemented activities has yet to be achieved. Quarterly reports on the implementation of the NPAA continue to be published regularly. The government’s website includes the annual government work plan. However, it still does not provide access to the rest of the government’s main public policy documents, such as action plans for implementing the government programme or monitoring reports of key government work plans. Minutes and conclusions of government sessions are not published either. Public financial management The 2016-2020 PFM reform programme is being implemented with delays. The future programme needs to ensure more realistic planning, costing and sequencing, better links with sector strategic framework and an increased focus on performance indicators and results. The government managed to keep the public finances on a sustainable path to more realistically planned revenue and expenditure projections. Final accounts as regards implementation of the budget 2002-2018, a legal obligation, have been adopted by the parliament after several years of non-compliance. The capital budget execution level continued its upward trend but a unified, comprehensive, effective and transparent system for planning and management of capital investments is yet to be put in place. The adopted decree on capital projects management and related rulebooks represent a step in the right direction. However, Serbia needs to apply the full methodology of the decree and public procurement procedures to all capital investments regardless of the type of investment or the source of financing, and ensure that procedures are in place to guarantee the integration of capital projects’ planning and appraisal in the budget process. Furthermore, the government’s investment planning and management capacity needs to be improved, including the capacity to control public assets funded by loans from third countries. Although the budget is structured by programmes, the link between the government programme and sector strategies and operational plans of budget beneficiaries is still weak. The legislative framework for public procurement and the strategic and legislative framework for conducting financial control was strengthened. The State Audit Institution has continued to increase both the coverage and quality of their audits of public funds, most prominently by multiplying the number of performance audits conducted within a year (See Chapters 5 – Public procurement, and 32 – Financial control). Serbia did not progress in improving budget transparency. A transparency roadmap, a pre-budget statement, and a mid-year report are still to be produced and published. The Ministry of Finance does not publish the budget execution profile at the beginning of the year, preventing any analysis of deviations from targets. Budget execution reports contain only basic elements but specify expenditure amounts for individual budget organisations. Public participation in the budget process and budget oversight by the legislature needs to be improved. The 2020 budget was adopted in line with the budget calendar, after a series of parliamentary debates, thus ending the lack of compliance with the budget system law. However, assessment and debate among the stakeholders need to be further improved. Public service and human resources management The civil service legislation provides for merit-based recruitment and dismissal procedures. Under the law on civil servants last amended in December 2018, the heads of institutions still have too much discretion in setting up selection committees. The possibility to convert certain categories of temporary contracts into permanent civil service contracts needs to be considered carefully in order to avoid possible abuse. With regard to the dismissal process, the revised performance appraisal procedure provides for a longer timeframe for improving performance. Grades received by civil servants during performance appraisal remain inflated. The new performance assessment system reflecting the policy priorities of institutions will need to be assessed in practice.

The lack of transparency in, and respect for, the merit-based recruitment procedure provided for under the Serbian legislation for senior civil service positions is an issue of increasingly serious concern. The legal provision allowing for appointments to ‘acting positions’ for 6 months (with a maximum extension of 3 months) continues being often misused. This has contributed to high staff turnover and loss of institutional memory in some cases, and in violation of the legal time limit in others. As of June 2020, 56% (March 2019: 63%) of filled senior positions are held on an acting basis. The amendments to the law on civil servants in December 2018 had aimed to address these shortcomings by means of restricting the appointments to already existing civil servants as of 1 July 2019. However, the government continues to appoint non-civil servants on an acting basis despite the deadline of 1 July 2019, which is in breach of the law. The limited capacity of the High Civil Service Council is of concern as regards the need to organise a large number of competitions in order to replace at a reasonable speed all the existing acting managers. The phasing out of the current acting positions needs to be addressed urgently and with more political will, and be effectively monitored by the institutions responsible. Current practices, where appointment decisions for management positions can be overthrown by a personnel committee of the government after the selection process has been finalised at the institutional level, lack transparency. This affects the proper functioning of the selection procedures embedded in the legislative framework. The effectiveness of the competency-based human resources management system, which was introduced by the amendments to the law on civil servants in December 2018, will need to be assessed in practice. The Human Resources Management Service needs to strengthen its capacity to coordinate and harmonise the work of human resources units of the line institutions. The ongoing development of a new human resources management information system is delayed and the current system does not interact with other national databases such as the treasury payroll registry. No progress was made regarding remuneration of civil servants. The implementation of the 2016 law on the salary system in the public sector, which introduces the principle of equal pay for equal work for all public sector employees, is seriously delayed as it was again postponed for another year, to 2021. Serbia’s Commissioner for Equality reported on the adverse effect that the law on the maximum number of employees in the public sector had on female staff, as it increased the likelihood that women retire earlier and that women under 30 become unemployed. With regard to professional development, the National Training Academy for Public Administration continued developing a national training framework and organising training for all public officials, including at local level. A comprehensive professional development programme for senior civil servants was adopted as part of the training programme for 2020. A code of ethics for civil servants aims to ensure integrity in public service. Further efforts are needed to ensure the existing integrity plans in the judiciary and in the public administration are fully implemented. The integrity of the civil service is undermined by the aforementioned excessive number of acting senior manager posts. There are no tangible improvements in relation to anti-corruption efforts at local level and the impact of the local anti-corruption plans has yet to be assessed. Accountability of administration The structure of the public administration has yet to be streamlined. The lines of accountability between agencies and their parent institutions remain blurred, contributing to overlapping functions, fragmentation, and unclear reporting lines. Political commitment to managerial accountability and systematic delegation of responsibilities is still needed. Institutions still have a bureaucratic and process-oriented approach to planning, budgeting and the reporting of their activities (See Chapter 32 – Financial control). The Ombudsman has a key role in ensuring citizens’ rights to good administration. Public authorities are obliged to report on the implementation of the Ombudsman’s recommendations. For the first time since 2014, the Ombudsman’s annual report was discussed in a parliament plenary session and conclusions were adopted in July 2019 (See Governance). Citizens’ right to access public information is regulated in the law on access to information of public importance, which has yet to be amended. Administrative silence, whereby public authorities fail to properly act on the citizens’ information requests, remains a major issue. Enforcement of the decisions taken by the Commissioner for Information of Public Importance has yet to be ensured (See Chapter 23 – Fight against corruption). On citizens’ right to administrative justice, the administrative court continues to operate with an insufficient number of judges. At the same time this court is coping with broadening responsibilities and a high number of pending cases, especially in relation to labour disputes including at local self-government level, which affects its efficiency. The appointment of new judges in 2019 is a positive step. It is too early to assess the impact of the new law on free legal aid, applied as of October 2019. While the citizens’ right to seek compensation is regulated, no statistical data is collected to monitor its implementation. Service delivery to citizens and businesses Creating a more user-oriented administration remains a government’s priority. Progress in developing e-services continued, although there is still no central policy ensuring access to services for the public. A law on the central population registry, as well as some of the implementing legislation on the e-government law, were adopted. The government adopted a new e-government programme in June 2020. There is strong coordination and leadership in this area from the e-government office and the Prime Minister’s Delivery Unit. Digital signatures are being used but the percentage (7% compared with 5% in 2018) of the population who avail of this service is still limited. A more modern e-government portal was rolled out in February 2020. The legal framework for simplification of administrative procedures has been in place since the 2016 law on general administrative procedures. However, regulatory uncertainty for individuals and businesses remains due to continuous delays with aligning the sector legislation with this law. People are still not aware of their improved rights, allowing the administration to apply old cumbersome procedures. The capacity of the Ministry of Public Administration and Local Self-Government to efficiently oversee the implementation of this law remains limited. Overlaps in coordination with the Public Policy Secretariat have yet to be addressed. 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. An effective (independent, quality and efficient) judicial system and an effective fight against corruption are of paramount importance, as is respect of fundamental rights in law and in practice. Serbia has some level of preparation to apply the EU acquis and the European standards in this area. Very limited progress was made overall. The constitutional reform aimed at strengthening the independence of the judiciary has been put on hold until after the parliamentary elections in spring 2020. The first step of the parliamentary procedure took place in June 2019 when the parliamentary committee approved the government’s initiative. The next required step, the vote in the plenary to approve this initiative, has yet to take place. Revision of the related judicial legislation started. Overall, corruption remains an issue of concern. The legal framework on fundamental rights is broadly in place but its implementation is inconsistent. Regarding freedom of expression, Serbia has adopted a new media strategy, which was drafted in a transparent and inclusive manner and identifies the main challenges related to media freedom in Serbia. However, implementation of the new strategy has not yet started and no progress was made yet on the ground to improve the overall environment for freedom of expression. The role of independent and regulatory bodies needs to be recognised, their capacities strengthened, including their budgets and skilled staff, and their functional independence must be guaranteed in practice. Serbia continued implementing the action plan which was adopted prior to the opening of the accession negotiations on this chapter in July 2016. It adopted a revised action plan in July 2020. The revised plan is oriented towards meeting the interim benchmarks of the EU common position. Functioning of the judiciary Serbia has some level of preparation in the area of judiciary. No progress was made in addressing last year’s recommendations which therefore remain valid. Efforts continued to reduce old enforcement cases and harmonise court practice. The system for judicial appointments and for evaluating the work of judges and prosecutors needs to be thoroughly revised following the adoption of the constitutional amendments to allow for merit-based judicial recruitments and careers. The scope for political influence over the judiciary is a continuous and serious concern. The delay in the adoption of the constitutional amendments has repercussions on the adoption of related judicial legislation that is needed to increase safeguards for judicial independence. In the coming year, Serbia needs in particular to: ®strengthen the independence of the judiciary and the autonomy of the prosecution, including through amendments to constitutional and legislative provisions related to the appointment, career management and disciplinary proceedings of judges and prosecutors; ®amend the laws on High Judicial Council and the State Prosecutorial Council so that they are empowered to fully assume their independent role to proactively defend judicial independence and prosecutorial autonomy in practice in line with European standards; ®adopt and implement a human resources strategy for the entire justice sector together with establishing a uniform and centralised case management system, necessary for a measurable improvement in efficiency and effectiveness of the justice system. Following the declaration of the state of emergency, the work of the courts was limited to processing urgent cases according to a list adopted by the High Judicial Council, mainly related to violations of the emergency measures. Furthermore, case-related time limits and the statute of limitation were suspended for the duration of the state of emergency. Some of the urgent hearings were held via Skype despite this modality lacking the necessary legal basis, as based only on an instruction by the Ministry of Justice. In some instances, these proceedings resulted in several years of imprisonment. On 1 April 2020, the government issued a decree, providing that it was for the judge to decide whether to hold distance hearings for the accussed in detention, whenever it was difficult to secure his/her presence due to the risk of spreading the virus. Following the lifting of the state of emergency, the High Judicial Council instructed the Serbian courts to re-open under detailed health safety instructions as of 11 May. The Constitutional Court received some 66 initiatives for assessing the constitutionality of the emergency measures and 10 appeals over possible violations of human rights. So far, the court has taken only one decision. On 21 May, it decided to dismiss the request to review the constitutionality of the procedure by which the state of emergency was introduced on procedural grounds. In the explanatory part of the decision, the court elaborated on the facts related to the epidemic situation, and did not assess the state of emergency decision in light of the Serbian Constitution and other legislation.

Strategic documents Serbia’s main strategic document, together with the action plan for Chapter 23, was the national judicial reform strategy (2013-2018). It expired in December 2018. The follow-up strategy (the national judicial development strategy) was adopted in July 2020 without a comprehensive impact assessment having been carried out. A revised action plan for Chapter 23 was also adopted in July 2020. These strategic documents are not underpinned by a clear financial analysis of the overall costs of the reform. A human resource strategy has also not yet been adopted. The World Bank completed a prosecution functional review and is up-dating its court functional review. Serbia needs to ensure that recommendations from the functional reviews are followed up on. Management bodies The High Judicial Council (HJC) and the State Prosecutorial Council (SPC) decide on the required number of judges and prosecutors, on appointments, evaluation, transfers and assignments, on disciplinary liability and dismissals of judges and prosecutors. They are responsible for initial and in-service training of the judiciary. In addition, the HJC is in charge of judicial administration and the management of budgetary funds for salaries of judges and related overhead expenses, including costs related to providing expert witnesses. The SPC is responsible for executing the budget as regards salaries of public prosecutors and deputy public prosecutors and for the costs of criminal procedures including related investigations. As regards the organisation of the courts and prosecution offices, responsibilities remain divided between the Ministry of Justice and the councils. The judicial institutions would benefit from an overall clearer system of governance which would lead to the entire judicial system’s independence, accountability and effectiveness being improved. Notably as regards the budget for the judiciary and the prosecution, divided responsibilities continue to adversely affect budgetary planning, resource allocation and execution. The workload of courts and prosecution offices should be taken into account in budgetary planning, as well as the number of court staff and their responsibilities. The new judicial strategy and the revised action plan for Chapter 23 do not clearly determine the next steps in addressing this and do not decide upon the Serbian authority responsible for the residual judiciary budget, which includes salaries of court and prosecution support staff. Some steps were taken to improve the transparency of the councils’ work, by including the minutes of their sessions and certain decisions on their websites. The councils’ professional and administrative capacities still need to be further strengthened. Long-term training plans for the councils’ members and support staff are needed. Independence and impartiality The current constitutional and legislative framework continues to leave room for undue political influence over the judiciary. Future legislative changes will need to increase the safeguards for judicial independence. A fully objective, transparent and merit-based system for appointing, transferring and promoting judges and prosecutors in line with European standards will need to be put in place also to promote professionalism and improve quality. The constitutional reform which aims to strengthen the judiciary’s independence and accountability has been put on hold until after the parliamentary elections in spring 2020. After the government had submitted to parliament an initiative to change the Constitution in November 2018, the first step of the parliamentary procedure took place in June 2019: the parliamentary committee approved the government’s initiative to change the Constitution. However, the next step, the vote in the plenary to approve this initiative, has yet to take place. Once approved, the parliamentary committee should start its technical work in drafting the text of the constitutional amendments, taking into account the draft text of the Ministry of Justice which took on board the Venice Commission recommendations. The latter also include a reference to ‘creating a constructive and positive environment around the public consultations to be held when the parliament will examine the draft amendments’. In January 2019, the authorities set up five working groups to revise the necessary implementing legislation, including legislation on the jurisdiction and organisation of courts and prosecution offices, on judges and on prosecutors, on the responsibilities and functioning of the judicial and prosecutorial councils and on the Judicial Academy. However, the delay in the adoption of the constitutional amendments has repercussions on the drafting and the adoption of the implementing legislation as clarity on the constitutional basis is still lacking. The Minister of Justice committed to consulting the Venice Commission on mature drafts of the legislation aimed at implementing the new constitutional provisions. Pressure on the judiciary still remains high. Government officials, some at the highest level, as well as members of parliament, continue to comment publicly on a regular basis ongoing investigations or court proceedings, and on individual judges and prosecutors. Articles in tabloid newspapers target and seek to discredit members of the judiciary. In some cases, judges have asked to be excused from adjudicating on cases involving local politicians, referring to pressure exercised on them and their families. The HJC and the SPC continued to monitor complaints by judges and prosecutors. In 2019, the HJC issued two public statements condemning public commenting. The SPC processed 18 complaints in 2019, and recommended measures in three cases. In one case, it justified the concern over influence by means of public comments and media campaigns. The codes of conduct for members of the government and parliament prohibit such behaviour. However, the ongoing undue pressure and comments on the work of the judiciary show that effective sanctions for undue influence of the judicial office holders or public comments that undermine their independence are not available or implemented efficiently. The HJC proposal for the election of court presidents was rejected by the relevant parliamentary committee in February 2020, and it was removed from the agenda amid allegations that individual candidates had criminal connections and political party memberships. Some 74 courts in Serbia thus continue to have acting presidents for an undefined period. Accountability A revision of the disciplinary rules and ethical codes is ongoing for both councils. This revision is needed in order to, among other things, better define the offences, strengthen the capacity of the disciplinary bodies and clarify which provision in the codes should entail disciplinary liability for their non-compliance. It needs to be ensured in line with European standards that only serious misconduct and not mere incompetence gives rise to disciplinary proceedings. Steps were taken to establish the ethical boards as permanent bodies of the councils. The members of the boards still need to be re-appointed since 2018. In order to improve the transparency of the disciplinary bodies’ work, the HJC posted 43 anonymised disciplinary decisions on its website, after adopting a rulebook on data anonymisation in June 2019. In 2019, the HJC disciplinary prosecutor received 491 complaints against judges, mostly from members of the public. In seven cases, it initiated a disciplinary procedure. The HJC’s disciplinary commission dealt with 31 cases, 25 cases were solved. A dismissal procedure was initiated in one case, and sentences with public warnings and salary reductions were issued. The SPC disciplinary prosecutor rejected complaints in 113 cases as unfounded and forwarded 7 cases to the disciplinary commission, the second instance. In three cases sanctions were issued including a public warning, prohibition of advancement in career and decrease in salary. The mandate of the SPC’s Commissioner for Autonomy expired in March 2020. During his three-year tenure, the Commissioner raised awareness about the pressure exercised on prosecutors in concrete cases, endangering their autonomy. Once the state of emergency was lifted, several requests for scheduling a session to discuss the end of the mandate the Commissioner as well as issues related to the state of emergency were not responded to. Professionalism and competence In 2019, the HJC elected 108 judges to permanent positions (2018: 51), promoted 68 judges to higher-level courts (2018: 42) and proposed to parliament 221 candidates for first-time judges (2018: 187). The mandate of the President of the Supreme Court of Cassation expired in December 2019. The HJC has yet to publish a call for candidates. The SPC elected 45 deputy prosecutors and proposed to parliament 19 candidates for first time deputy prosecutors. In the context of the constitutional amendments which aim to strengthen the judiciary’s independence and accountability, there is a need to revise the current system of recruitment, transfer and promotion of judges and prosecutors, in order to ensure that their careers are fully based on merit, with a clear link between performance evaluation and career advancement and that final decisions are taken by the councils and not by the parliament. Participation in continuous training (but not the evaluation of such participation) should become a mandatory part of professional performance evaluation for judges. In addition, the professional evaluation of judges should be based not only on quantitative criteria but also on qualitative criteria. At present, Serbia still has two categories of eligible candidates for the judicial profession: graduates of the Judicial Academy, and judicial and prosecutorial assistants. No progress was made in addressing the Venice Commission’s advice on how to effectively ‘protect the Academy from possible undue influence’. Strengthening its independence and professionalism therefore remains a prerequisite for becoming a sole nationwide entry point to the profession at basic courts’ level. Quality of justice The Judicial Academy is mandated to provide both initial training for qualified law graduates who aspire to work in the judicial profession and in-service training for judges, prosecutors and court staff. The Judicial Academy operates under the supervision of the Ministry of Justice. There is still an urgent need to improve the academy’s professionalism, notably as regards its internal capacity and organisation. In addition, its cooperation with the councils needs to be strengthened. The academy’s internal organisation reflects the composition of the HJC and SPC. This should improve the quality of the analysis of training gaps and needs. While manuals and guidelines for evaluating the training provided were developed, there is no regular and effective quality control mechanism applied consistently. Impact assessments of training provided should demonstrate that the skills acquired are effectively applied in practice. The development of a multiannual work programme based on a thorough needs assessment has been delayed. A systematic approach to the training of judiciary staff is still lacking. Continuous training activities, which also require coordination efforts in order to avoid overlapping, continue to be highly dependent on different donors. The academy is an observer to the European Judicial Training Network (EJTN) but is not proactively benefiting from the expertise within the network. Further steps were taken to improve transparency by publishing some 4 000 anonymised judgments of the four appellate courts. In line with the previous 2018 agreement between four Serbian appellate courts and the plan of activities to harmonise court practice, the regular joint sessions and meetings with lower courts with the aim of harmonising court practice continued. A number of appellate court and misdemeanour court decisions have been uploaded onto the online database and are available to judges. Efforts need to continue to link the various existing databases, including the one on the judgments of the European Court of Human Rights, and to broaden their scope. Harmonising court practice in the present court system with over 20 courts, where judgments become final remains difficult to achieve. Structural shortcomings should be analysed in the context of a comprehensive assessment of the system’s court and prosecution network, and the role of the Supreme Court of Cassation in effectively orienting jurisprudence should be considered.

As of June 2020, there are 2 703 full time judges, i.e. 38.81 per 100 000 inhabitants. There are in total 786 public prosecutors, i.e. 8.9 per 100 000 inhabitants. The European average is 21 judges and 11 prosecutors per 100 000 inhabitants. The average age for judges in Serbia is 52. The court and prosecution network is highly complex in terms of structure (160 courts and 90 prosecution offices) and overly complex in the aspect of financing, procurement and court payments for services. The deployment of non-judicial staff is fragmented. Due to drop in the number of judicial assistants (due to an employment ban in public administration) courts became dependent on part-time and volunteer work. The Serbian justice system continues to rely on several different case management applications that are not interconnected. There is still an increasingly urgent need for a comprehensive information and communication technology strategy with clear timelines and related financial commitments. A comprehensive countrywide system to process and interlink cases across courts and prosecutorial networks, with adequate technological support has yet to be put in place. The technical work for the national roll-out of case management systems for the prosecution and for the prison administration started in early October 2019. However, further work is required on fullfilling the necessary preconditions such as legislative changes, adequate staffing and budget as well as upgraded communication infrastructure to ensure that all of the case management systems can perform including the one for the courts. Once in place, such a comprehensive, centralised and country-wide court case (and document) management system should ensure a more efficient processing of cases. It should also provide the necessary stastical data in line with the methodology of the Council of Europe’s commission for the efficiency of justice. It could also support an automatic case allocation system which should take into account the case weighting criteria for more balanced distribution of workload. A case weighting formula has been piloted 20 basic and higher courts, and should be rolled out at the national level. There are currently 198 public notaries in Serbia covering almost the entire country. Newly adopted bylaws have improved the management of documents while better access to different databases allows for electronic issuance of certificates and filing of property tax applications. Notaries have successfully processed inheritance cases. The notary chamber continued its efforts in improving training and standardisation of practice. In the area of alternative dispute resolution/mediation the working group on the revision of the law on mediation adopted an analysis on how to increase the use of mediation. This analysis and possible subsequent legal changes were discussed in four public debates among lawyers, judges, mediators, legal professionals, NGO representatives and the media in July 2019 but further steps are yet to be taken. There are 1 349 certified mediators (277 of which are attorneys), but only 124 declared themselves as active in mediation in 2019 (9%). Based on their reports, 569 mediations were conducted in 2019. This represents a slight drop compared with 638 mediations in 2018 and 619 in 2017. Out of 569 mediated cases in 2019, 403 were concluded with a settlement agreement. In 266 proceedings, cases were referred to mediation by the court. The number of mediations compared with the number of pending civil court proceedings thus remains below 1%. Additional incentives for mediation, including legislative amendments to increase the scope of cases referable to mediation should be considered. The system and criteria for certification of mediators and licensing of trainers should be further improved. The revised law on amendments and supplements to the law on court fees applicable from January 2019 has further encouraged parties to resolve their disputes by amicable means, including mediation, negotiated settlement, and court settlement. Efficiency The implementation of the national backlog reduction programme (for 2016–2020) continued under the supervision of the Supreme Court of Cassation. It continues to have a positive, although more reduced, impact on the courts’ efficiency with the backlog of old enforcement cases shrinking. The definition of ‘old’ cases has also been altered and now only includes cases that are more than 3 years old, rather than those over 2 years old. In 2019 some 214 234 old cases were resolved (out of which 112 473 were enforcement cases), which is lower than in 2018 (311 018 out of which 140 452 were enforcement cases). There are also cases more than 10 years old and their number remains high with 1 184 in second instance courts and 252 210 in basic courts, mostly dealing with civil matters. The number of cases alleging violations of the right to a trial within reasonable time was higher in 2019 (100 600) than it was in 2018 (68 720). The overall high number of pending backlog cases continues to be a concern (685 456 cases more than 2 years old at the end of 2019 compared with 781 137 at the end of 2018). The highest number of pending backlog cases (approx. 86.6% of the total) is in basic courts. While the overall clearance rate dropped from 139.87% to 106.04% between 2016 and 2017, it increased again in 2018 to 110.03% before dropping again in 2019 to 102.01%. In 2019, the average duration for cases to be resolved was 267 days, compared with 270 days in 2018. Thus, for the fourth year in a row, the Serbian judicial system was able to process more cases than it received. At the same time, the courts in 2019 received a higher number of cases in 2019 (2 224 102) than it did in 2018 (2 089 237) – a trend which continued from 2017 (2 202 692). The jurisdiction of the Constitutional Court covers assessing compliance of laws and other general acts with the Constitution as well as deciding upon constitutional complaints over potential violations of human or minority rights and freedoms. In 2019, 36 892 cases were pending cases (22 473 from previous years). There are almost 1 300 cases older than 2017, and almost 21 000 from the years 2017 and 2018. The constitutional appeals account for around 98% of the total number (36 291). Only a very small percentage (around 6%) of them were resolved in merits. There is a need for more transparency in the work of the court, including as regards accessibility for the public. There are still significant differences in workload between the courts across the country. In the first half of 2019, a higher number of cases was registered in the Belgrade courts in particular, where judges already have the biggest workload in civil cases. Lengthy proceedings, the absence of comprehensive and effective free legal aid system and the slow pace of processing indemnity claims continue to hamper the quality of justice and people’s access to justice (See Procedural rights). The impact of the new free legal aid law, implemented only as of October 2019 is yet to be assessed. Amendments to the law on enforcement and security of July 2019 (in force since January 2020) envisage the transfer of additional types of enforcement cases from courts to public enforcement agents. Secondly, the law introduces a new appeal system to better protect individual debtors and strengthen court control over public enforcement agents. However, this has not yet been matched with additional human resources in courts. The fees for enforcement procedures were lowered. Furthermore, the law introduced an e-auction platform to increase access to information and improve transparency. Domestic handling of war crime cases Serbia needs to fully cooperate with the International Residual Mechanism for Criminal Tribunals (IRMCT), including by fully accepting and implementing its rulings and decisions. As in previous years, Serbia has repeatedly and publicly challenged the judgments of the International Criminal Tribunal for the former Yugoslavia (ICTY), including at the highest levels. Serbia’s non-cooperation in relation to the arrest of people indicted for contempt of court had not been resolved by the time of the ICTY’s closure, and the case was then transferred to the IRMCT. In February 2020, the IRMCT’s Appeals Chamber confirmed that the IRMCT has to hear the contempt of court case and it is not to be referred to Serbia. This decision is final. Regarding judicial cooperation issues, the bilateral agreements between the prosecutor’s office of Serbia and its counterparts in Bosnia and Herzegovina, Croatia and Montenegro on cooperation related to the investigation of war crimes, crimes against humanity and genocide have not been used to their full extent. In 2019, the cooperation with Bosnia and Herzegovina has led to indictments being issued in Serbia. Cooperation with Croatia has continued to face a number of impediments and has not led to tangible results. Mutual legal cooperation continues to be extremely limited in war crimes cases. Serbia has not yet enforced the judgment of Bosnia and Herzegovina in the case of General Djukić. The latter resides in Serbia. Basic legal and procedural issues remain between the countries, which impede proper regional cooperation. The implementation of the 2016 national strategy for the investigation and prosecution of war crimes has continued at a very slow pace. Although this strategy expires at the end of 2020, no preparations are underway for a new strategy. A multi-institutional monitoring mechanism is in place. It has issued seven reports, which fail to include recommendations on how to address the challenges in implementing the strategy. The Office of the War Crimes Prosecutor (OWCP) has not issued a report on its work since December 2018. The level of access and the prompt release of information on the website of the OWCP have deteriorated over the past three years. The OWCP filed four indictments against four individuals in 2019, of which three cases were transferred from Bosnia and Herzegovina. Two of the above-mentioned indictments were dismissed as the two defendants were found permanently incapable of following the proceedings, while after confirmation by the court, one of the above-mentioned indictments was merged with another case. At the end of 2019, there were 16 cases ongoing at first instance, and one case at appeal level against a total of 44 defendants, most of whom are low-ranking staff (three mid-ranked and 41 low-ranking members of the police, the military, and also of paramilitary groups. Several cases have been ongoing for over 5 years or more. Serbia continues to have more than 2 500 cases at the pre-investigation phase. Seven first-instance judgments were handed down, whereby 15 defendants were convicted and sentenced to prison terms ranging from 2 to 15 years, while one defendant was acquitted. Two of the above-mentioned judgments involve war-related criminal acts of sexual violence. In one of the above-mentioned cases, the first instance court accepted a plea agreement and sentenced the defendant to a one and a half year imprisonment. At second instance, four final judgements were handed down, convicting seven defendants and sentencing them to prison terms from 3 to 12 years.

Serbian authorities continue to provide public space to convicted war criminals, and permit hate speech. Denial of the Srebrenica genocide by certain members of parliament continued without sanctions. The parliament in 2019, as in previous years, has not taken a final decision regarding the termination of the mandate of one of its members who was convicted by the ICTY at final instance. Overall, Serbia should show a genuine commitment for investigating and adjudicating war crimes cases. This is also needed for effectively dealing with the legacy of the past and for fostering reconciliation. Serbia should prioritise complex cases and those involving senior ranking officials as regards command responsibility. Fight against corruption Serbia has some level of preparation in the fight against corruption. Limited progress has been made in implementing last year’s recommendations. Operational steps have been taken to strengthen the mandate and to ensure the independence of the Anti-Corruption Agency, as well as to enhance its capacities with a view to implementing the law on the prevention of corruption upon its entry into force in September 2020. Legislative amendments were adopted in December 2019 to clarify provisions on the prohibition of use of public resources for the purposes of electoral campaigns, following the recommendations of ODIHR. As regards repression of corruption, the changes brought by the law on the organisation and jurisdiction of government authorities in suppression of organised crime, terrorism and corruption, in force since March 2018, produced some results in terms of finalised cases. Overall, corruption remains an issue of concern. There is still no effective coordination mechanism in place to operationalise prevention policy goals and effectively address corruption. Furthermore, the number of finalised high-level corruption cases has decreased compared with the previous years. Serbia should increase its efforts in addressing these shortcomings and step up the prevention and repression of corruption. It should: ®improve its track record on investigations, indictments and final convictions in high-level corruption cases, including the seizure and confiscation of criminal assets; ®effectively implement the law on the prevention of corruption in line with the EU acquis, international agreements and Council of Europe’s Group of States against Corruption (GRECO) recommendations, in order to strengthen the agency’s role as a key institution in a more effective fight against corruption; ®adopt a new anti-corruption strategy underpinned by a credible and realistic action plan as well as an effective coordination mechanism. Track record Serbia continued to implement the law on the organisation and jurisdiction of government authorities in suppression of organised crime, terrorism and corruption. The changes brought by this law produced some results in terms of finalised cases for combating corruption in the special departments for supression of corruption in the higher prosecutors’ offices and special court departments. In 2019, criminal complaints were filed against 3 577 individuals. Indictments were filed against 583 individuals. The courts convicted 399 individuals at first instance based on indictments by these special departments (2018: 332), out of which there were court‑accepted plea agreements for 304 defendants (2018: 294). In relation to high level corruption, based on indictments from the Prosecutor’s Office for Organised Crime, the courts rendered first instance judgements against 30 individuals in 2019 (compared with 41 in 2018 and 50 in 2017). Of these, 10 were based on plea agreements (compared with 13 in 2018). Confiscation of assets was imposed in 3 of these cases (compared with 2 in 2018). The Prosecutor’s Office for Organised Crime indicted 20 individuals (in comparison to 21 in 2018). Serbia still needs to show a convincing track record of confiscating assets in corruption cases. In relation to preventing corruption, the Anti-Corruption Agency issued 63 opinions related to requests on conflicts of interest in 2019 (2018: 77). It filed 10 requests for misdemeanour proceedings. The agency initiated 159 procedures (15 based on reports and 144 ex officio) (151 for 2018: 37 based on complaints and 114 ex officio) on grounds related to accumulation of functions without the agency’s prior approval, and 151 procedures for other situations related to conflict of interest or nepotism (131 based on reports and 20 ex officio) (166 for 2018: 145 based on complaints and 21 ex officio). In 2019, the misdemeanour courts issued 27 first instance judgments, based on requests filed by the agency during that year. The agency submitted 76 requests related to a failure to promptly submit asset declarations for misdemeanour proceedings in 2019 (2018: 45). Based on the agency’s work in previous years, misdemeanour courts issued 65 convictions in 2019 (2018: 49). The agency filed 25 criminal charges in 2019 (2018: 16) due to reasonable suspicion that a public official had not reported assets or had given false information about assets intending to conceal the facts. Based on the agency’s previous work, 19 final judgments were issued. The agency also performs checks on the funding of political activities and of elections, and has conducted selections and trained 144 election campaign observers. It submitted 96 requests for misdemeanour proceedings for violations of the law on political activities financing in 2019 (2018: 90). In the same period, courts rendered 175 final verdicts. Based on final sentences, in 2019, the agency published 59 decisions on political entities losing the right to use public funds for their regular work during 2019 (2018: 33). The agency signed two misdemeanour plea agreements in 2019. A comprehensive and evidence-based assessment of access to information is not possible, as the majority of public authorities do not comply with the obligation to provide data to the Commissioner for Information of Public Importance regarding citizens’ requests for information. The Commissioner established that 4 321 or 83% (2018: 3 444 or 87%) of citizens’ complaints – most of them concerning administrative silence – were well-founded, meaning that the authorities should have provided the information requested by citizens according to the law on access to information of public importance. In 1 786 or 41% (2018: 1 889 or 55%) of these well-founded cases, the authorities reported that they acted upon the Commissioner’s request to provide the information to the complainants even before a decision was made on the appeal, which would indicate that there was no reason not to disclose the requested information in the first place. Administrative enforcement of the decisions taken by the Commissioner has yet to be ensured. In 2019, courts in Serbia received 152 new cases based on the law on whistle-blower protection (2018: 122) and out of the total caseload of 220 cases, 160 cases were finalised (2018: 124). The protection of whistle-blowers in high corruption cases needs to be ensured, including in order to strengthening trust in the institutions. Whistle-blower reports should be investigated in accordance with the law, such as in the case of Krusik. The new law on public procurement (see Chapter 5 – Public procurement) contains provisions for detection and prevention of corruption during the procurement process. The public procurement rules continue to apply and provide for flexibility in case of extreme emergency situations, like the COVID-19 crisis. However, the more flexible procedure still requires abiding by the principle of transparency. Institutional framework Prevention measures The revised law on the prevention of corruption, previously known as the law on the Anti-Corruption Agency, was adopted in May 2019. It provides for, among other things, an increase in the agency’s powers and an improvement in how it operates in order to meet the GRECO recommendations. GRECO has yet to assess this law as it has yet to issue its next compliance report on the implementation of recommendations on the prevention of corruption in respect of members of parliament, judges and prosecutors.

The gradual strengthening of the agency’s resources and capacity is ongoing in order to empower it to implement the law as from September 2020. The new law should be implemented along the lines of the GRECO recommendations, and ensure that there is increased independence, credibility and priority-setting in the agency’s work. A public competition is ongoing, and the agency had, as of June 2020, 87 permanent positions filled (compared with 80 in 2018). Improvements to the agency’s ICT systems have been put in place to allow it to step up data collection and analysis. Furthermore, regular training sessions have been provided to ensure the new law on prevention of corruption is implemented. The annual report of the Anti-Corruption Agency for 2018 was presented in May 2019 to parliament, which adopted conclusions. However, the workshops with the relevant parliamentary committee in order to implement the agency’s recommendations were not held. The annual report for 2019 was adopted by the Anti-Corruption Agency in March 2020. The law on lobbying entered into force in August 2019. Training sessions on its implementation have been organised, and the agency adopted the necessary bylaws and registers. The agency did not conduct public awareness and citizens’ engagement campaigns during 2019. The situation in the sectors particularly vulnerable to corruption (i.e. sectors where there is substantial public expenditure involved, or alternatively sectors where there is direct contact with the public) remains largely unchanged. These include public procurement, infrastructure projects, healthcare, education, construction and spatial planning, and public companies. There are still no tangible improvements in relation to the transparency and corruption risk assessments and mitigation in these fields. The risks of corruption in the implementation of public-private partnerships and in relation to the use of exceptions in large infrastructure projects have been identified. A recently adopted law on special procedures for linear infrastructure projects allowing for the exemption from public procurement rules of projects of ‘strategic importance’, in particular, raises serious concerns regarding its potential for corruption. Out of the 102 local self-governments that adopted anti-corruption plans, 28 established a body to monitor their implementation, mostly in line with the Anti-corruption Agency’s model. Overall, there were no tangible improvements in relation to anti-corruption efforts at the local level, and the impact of the local anti-corruption plans is yet to be assessed. The Anti-Corruption Council, in its advisory role to the government, remained active in exposing and analysing cases of systemic corruption. It is still not working in full capacity: only 7 out of 13 members are nominated. It issued informative reports in 2019 on enforcement agents, on the science fund, on the lack of transparency as regards signature of contracts by the government and on the rule of law, as well as on public procurement in 2020. The government has yet to start cooperating with this council and does not systematically consult it on draft legislation. The required amendment to the government’s rules of procedure for systematic consideration of the Anti-Corruption Council’s recommendations has been seriously delayed. The authorities should establish a more constructive relationship with the council. Law enforcement Serbia continued to implement the law on the organisation and jurisdiction of government authorities in suppression of organised crime, terrorism and corruption. The special departments for combating corruption in the Higher Prosecutors’ Offices in Kraljevo, Niš, Novi Sad and Belgrade have a total of 45 deputy public prosecutors (44 in 2018). There are nine new workplaces for deputy prosecutors in the special department in Be