WRITTEN QUESTION P-1086/01

by Joost Lagendijk (Verts/ALE) to the Commission

(26 March 2001)

Subject: Slovenia's free-trade agreements with Croatia, FYROM and Bosnia

In the context of the negotiations on Slovenia's accession to the EU, the EU has asked that country to drop its free-trade agreements with Croatia, FYROM and Bosnia in order to comply with the obligations of EU membership. Free-trade agreements with countries which do not belong to the EU would give Slovenian companies a competitive advantage over undertakings in other EU countries. This would affect the operation of the common agricultural policy, the implementation of the Common Customs Tariff and the free movement of goods within the internal market.

Does the Commission agree that free trade between Slovenia and Croatia, FYROM and Bosnia would enhance regional cooperation, which is vital to peace and stabilty in the Balkans and will contribute to further economic development of all the countries involved?

Is it true that transitional periods in respect of the free-trade agreements of a new European Union Member State with a non-Member State have been granted in the past?

Does the Commission support the view that the free-trade agreements between Slovenia and Croatia, FYROM and Bosnia can be brought in line with the trade liberalisation measures envisaged for the countries of South-east Europe in the framework of the stabilisation and association processes?

Answer given by Mr Verheugen on behalf of the Commission

(7 May 2001)

The Commission confirms that any arrangement allowing Slovenia to maintain separate trade agreements with third countries after accession to the Union would disrupt the functioning of several key Community policies, notably the Common Commercial Policy, the Common Agriculture Policy and the Customs Union. It would also be incompatible with the operation of the single market without internal borders. It would also provide Slovenian companies with an unfair competitive advantage over other Community undertakings, since Slovenia's current free trade agreements with Croatia and the Former Yugoslavia Republic of Macedonia (FYROM) are based on different principles than those followed under the Union's Stabilisation and Association Process, resulting in better access to these markets for Slovenian products than those enjoyed by Community products.

No transitional arrangement has ever been granted to any acceding State that would allow it to maintain a bilateral free trade agreement with a third country.

Promoting regional trade by means of asymmetrical trade concessions in favour of the countries concerned is an important element of the Union's Stabilisation and Association Process for south-east Europe. Fostering economic development is also an objective of the Stabilisation and Association Agreements (SAAs), one of which will soon be signed with FYROM, while one is currently under negotiation with Croatia. The autonomous measures already granted by the Union, soon to be superseded by the Stabilisation and Association Agreements, liberalise approximately 95 % of these countries' exports to the Union. Upon accession, Slovenia will become a party to these agreements, which are more comprehensive in scope than its current arrangements, and would provide a solution to a large part of the concerns put forward by Slovenia. As the Honourable Member points out, such agreements will indeed enhance regional co-operation, thus supporting peace, stability and further economic development in the Western Balkans.

Technical contacts are ongoing with the Slovenian authorities to assess the practical dimension of the issue.