Communication from the Commission - Commission Opinion on the application from the former Yugoslav Republic of Macedonia for membership of the European Union {SEC(2005) 1425 } {SEC(2005) 1429 }
Date: 2005-11-09
Institutions: European Commission
Subjects: EC opinion, North Macedonia, accession criteria, accession to the European Union, economic situation, political situation

COMMISSION OF THE EUROPEAN COMMUNITIES 

Brussels, 09.11.2005 
COM (2005) 562 final 

COMMUNICATION FROM THE COMMISSION 

Commission Opinion on the application from the former Yugoslav Republic of 
Macedonia for membership of the European Union 

{SEC(2005) 1425 } 
{SEC(2005) 1429 } 

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A. 

a) 

INTRODUCTION 

Preface 

The former Yugoslav Republic of Macedonia presented its application for membership of the 
European Union on 22 March 2004 and the Council of Ministers requested the Commission to 
submit its Opinion on this application on 17 May 2004, in line with the procedure laid down 
in Article 49 of the Treaty on the European Union, which states: “Any European State which 
respects the principles set out in Article 6(1) may apply to become a member of the Union. It 
shall address its application to the Council, which shall act unanimously after consulting the 
Commission and after receiving the assent of the European Parliament, which shall act by an 
absolute majority of its component members.” 

Article 6(1) states “The Union is founded on the principles of liberty, democracy, respect for 
human rights and fundamental freedoms, and the rule of law, principles which are common to 
the Member States.” 

This is the legal framework within which the Commission submits the present Opinion. 

The application from the former Yugoslav Republic of Macedonia for membership is part of 
an historic process, in which the Western Balkan countries are overcoming the political crisis 
in  their  region  and  orienting  themselves  to  join  the  area  of  peace,  stability  and  prosperity 
created by the Union. In the “Thessaloniki Agenda for the Western Balkans”, adopted by the 
June  2003  European  Council,  the  EU  stressed  “that  the  pace  of  further  movement  of  the 
Western  Balkan  countries  towards  the  EU  lies  in  their  own  hands  and  will  depend  on  each 
country’s  performance  in  implementing  reforms,  thus  respecting  the  criteria  set  by  the 
Copenhagen  European  Council  of  1993  and  the  Stabilisation  and  Association  Process 
conditionality”. 

The European Council in Copenhagen in June 1993 concluded that: 

“The associated countries in Central and Eastern Europe that so desire shall become members 
of the Union. Accession will take place as soon as a country is able to assume the obligations 
of membership by satisfying the economic and political conditions. 

Membership requires: 

– 

– 

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that  the  candidate  country  has  achieved  stability  of  institutions  guaranteeing 
democracy,  the  rule  of  law,  human  rights  and  respect  for  and  protection  of 
minorities; 

the existence of a functioning market economy, as well as the capacity to cope with 
competitive pressure and market forces within the Union; 

the ability to take on the obligations of membership, including adherence to the aims 
of political, economic and monetary union. 

The Union’s capacity to absorb new members, while maintaining the momentum of European 
integration, is also an important consideration in the general interest of both the Union and the 
candidate countries.” 

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The  European  Council  in  Madrid  in  December  1995  referred  to  the  need  “to  create  the 
conditions  for  the  gradual,  harmonious  integration  of  the  application  countries,  particularly 
through  the  development  of  the  market  economy,  the  adjustment  of  their  administrative 
structure, the creation of a stable economic and monetary environment.” 

The Stabilisation and Association Process (SAP) conditionalities were defined by the Council 
on 29 April 1997 and included co-operation with the International Criminal Tribunal for the 
Former  Yugoslavia  (ICTY)  and  regional  co-operation.  These  conditions  are  a  fundamental 
element  of  the  SAP  and  are  integrated  into  the  Stabilisation  and  Association  Agreement 
(SAA)  with  the  former  Yugoslav  Republic  of  Macedonia, which entered  into force  in April 
2004. 

In its Opinion, the Commission therefore analyses the application from the former Yugoslav 
Republic of Macedonia on the basis of the country’s capacity to meet the criteria set by the 
Copenhagen  European  Council  of  1993  and  the  conditions  set  for  the  SAP,  notably  the 
conditions defined by the Council in its conclusions of 29 April 1997. 

The method followed in preparing this Opinion is the same as used in previous Opinions. The 
Commission has analysed both the present situation and the medium-term prospects. For the 
purpose  of  this  Opinion  and  without  prejudging  any  future  date  of  accession,  the  medium-
term perspective has been defined as a period of five years. In drawing up its recommendation 
on the opening of accession negotiations, the Commission has paid particular attention to the 
existing capacity of the former Yugoslav Republic of Macedonia to meet the political criteria. 

The report containing the detailed analysis on which this Opinion is based is made public as a 
separate  document  (Analytical  Report  for  the  Opinion  on  the  application  from  the  former 
Yugoslav Republic of Macedonia for EU membership). 

b) 

Relations between the EU and the former Yugoslav Republic of Macedonia 

The former Yugoslav Republic of Macedonia, which was the southernmost part of the former 
Socialist  Federal  Republic  of  Yugoslavia  and  has  a  population  of  2  million,  became 
independent  in  November  1991.  The  country  has  maintained  contractual  relations  with  the 
European  Communities  since  1996.  In  1997  it  signed  a  Co-operation  Agreement  as  well  as 
Trade  and  Textile  Agreements  which  entered  into  force  in  1998.  A  Stabilisation  and 
Association  Agreement  (SAA)  was  signed  in  April  2001  and  entered  into  force  on  1  April 
2004. 

The main challenge for the country’s political stability since it became independent was the 
2001  crisis.  The  Ohrid  Framework  Agreement,  signed  on  13  August  2001,  and  the 
commitment  demonstrated  by  the  governments  in  office  since  2001  to  implement  it,  has 
achieved  a  return  to  stability.  The  Framework  Agreement  required  the  implementation  of  a 
broad  legislative  programme,  which  was  completed  in  July  2005.  The  Government  is  now 
proceeding  with  the  effective  implementation  of  the  new  legislative  framework,  which  will 
further  strengthen  the  climate  of  confidence  and  stability  in  the  country  and  foster  an 
increasingly positive environment for integration with the EU. 

The European Union  has  consistently  been supporting this process. The EU commitment to 
peace  and  stability  in  the  country  was  further  illustrated  by  the  EU  military  mission 
“Concordia”,  which  took  over  from  the  NATO  missions,  from  March  to  December  2003. 
After the decision taken in September 2003 at the invitation of the government, in December 

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2003 the EU deployed a police mission, “EUPOL Proxima”. It has a mandate to support the 
consolidation  of  law  and  order  and  the  reform  of  the  police.  EUPOL  Proxima’s  current 
mandate  runs  until  15  December  2005.  The  European  Union  Monitoring  Mission  has  also 
been present in the country since 2001 under an agreement concluded in August 2001. 

The Commission is supporting the former Yugoslav Republic of Macedonia financially in its 
European integration efforts and will focus on measures to tackle the shortcomings identified 
in  this  Opinion.  National  annual  CARDS  programmes  worth  €51  million  in  2004  and  €39 
million in 2005 have been adopted. 

B. 

CRITERIA FOR MEMBERSHIP 

1. 

POLITICAL CRITERIA 

The  former  Yugoslav  Republic  of  Macedonia  has  stable  democratic  institutions  which 
function  properly,  respecting  the  limits  of  their  competences  and  co-operating  with  each 
other.  Despite  repeated  recommendations  made  by  the  OSCE-ODIHR  following  the  2002 
elections,  the  local  elections  in 2005  displayed  a  series  of  serious  irregularities.  Timely  and 
appropriate  implementation  of  the  recommendations  of  the  OSCE-ODIHR  and  commitment 
of  the  political  parties  will  be  decisive  to  ensure  the  full  integrity  of  the  next  parliamentary 
elections.  While  the  opposition  generally  plays  a  normal  part  in  the  operation  of  the 
institutions, one opposition party has decided to abstain from participating in the Parliament’s 
work since April 2005. 

There  has  been  strong  commitment  to  the  implementation  of  the  Ohrid  Framework 
Agreement  and  important  progress  made  since  2001  has  been  crucial  for  strengthening  the 
country’s  stability.  To  further  strengthen  the  climate  of  confidence  and  consolidate 
achievements, the government should continue effective implementation of the Agreement. 

The rule of law is being gradually consolidated. Considerable efforts at reforming the police 
have been made since the crisis in 2001. However, steps remain to be taken to secure the rule 
of law all over the territory. This includes pursuing the reform of the police, which is crucial 
for more effective policing and the prevention of the possible escalation of incidents. Efforts 
to improve the independence and efficiency of the judiciary, starting with the modification of 
the  Constitution  in  line  with  the  recommendations  of  the  Council  of  Europe,  need  to  be 
sustained.  The  level  of  corruption  remains  high  and  affects  many  aspects  of  the  economic, 
social  and  political  life  of  the  country.  The  effectiveness  of  the  fight  against  corruption 
therefore needs further strengthening. 

There  are  no  major  problems  in  the  area  of  respect  for  fundamental  rights.  A  number  of 
constitutional and legislative changes have been made providing a high level of protection of 
the rights of minorities. It is important that these legislative provisions continue to be properly 
implemented. 

The  country  fully  cooperates  with  the  International  Criminal  Tribunal  for  the  former 
Yugoslavia.  It  ratified  a  bilateral  immunity  agreement  with  the  USA  regarding  the 
International Criminal Court, which is not in line with the relevant EU guiding principles. The 
country  is  committed  to  regional  co-operation.  Sustained  efforts  are  needed  in  this  area,  in 
particular in order to resolve the name issue with Greece in the interest of good neighbourly 
relations. 

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2. 

ECONOMIC CRITERIA 

In  the  former  Yugoslav  Republic  of  Macedonia  there  is  a  broad  political  consensus  on  the 
essentials of economic policies. The economy has achieved a high degree of macroeconomic 
stability, with low inflation, balanced public finances and low public indebtedness. Price and 
trade  liberalisation,  as  well  as  privatisation,  are  largely  completed.  The  financial  sector 
appears  to  be  stable.  The  labour  force  is  equipped  with  sound  basic  education  and  the 
country’s  endowment  of  transport  and  telecommunication  infrastructure  is  fairly  good. 
Economic integration with the EU is well advanced. 

However,  the  functioning  of  the  market  economy  is  impeded  by  institutional  weaknesses, 
such  as  the  slow  and  cumbersome  administrative  procedures,  shortcomings  in  the  judiciary 
and limited progress in land and property registration. As a result, the business climate is not 
conducive  to  stimulating  investment,  particularly  foreign  direct  investment,  and  growth.  In 
addition,  the  functioning  of  the  labour  and  financial  market  is  deficient,  which  impedes  the 
reduction of the particularly high unemployment and hinders credit provision to enterprises. 
Domestic and foreign investment has been insufficient, resulting in low productivity growth 
and a deterioration in competitiveness. The existence of a considerable informal sector leads 
to  major  distortions  in  the  economy.  The  commodity  structure  of  exports  is  unbalanced.  At 
this stage, the economy would thus face major difficulties in sustaining competitive pressures 
in  the  single  market.  Addressing  the  identified  weaknesses  by  proceeding  with  structural 
reforms  should  contribute  to  enhancing  the  functioning  of  the  market  economy  and  its 
competitiveness. 

3. 

ABILITY TO ASSUME THE OBLIGATIONS OF MEMBERSHIP 

The  ability  of  the  former  Yugoslav  Republic  of  Macedonia  to  assume  the  obligations  of 
membership has been evaluated according to the following indicators: 

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The obligations set out in the Stabilisation and Association Agreement; 
Progress with adoption, implementation and enforcement of the acquis. 

The  former  Yugoslav  Republic  of  Macedonia  has  made  progress  with  applying  the 
Stabilisation  and  Association  Agreement,  although  due  attention  needs  to  be  paid  to 
respecting the deadlines set out therein. 

The country has made significant efforts to align its legislation with the acquis, particularly in 
areas related to the Internal Market and trade. These efforts need to be continued. However, 
the country faces major challenges in implementing and, especially, effectively enforcing the 
legislation. Administrative and judicial capacity remains weak in many areas and will need to 
be significantly strengthened for the acquis to be properly applied. 

If it continues its efforts, the former Yugoslav Republic of Macedonia should not have major 
difficulties in applying the acquis in the medium term in the following fields: 

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Fisheries; 
Economic and monetary policy; 
Statistics; 
Enterprise and industrial policy; 
Trans-European networks; 
Science and research; 

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– 
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Education and culture; 
External relations; 
Foreign, security and defence policy; 
Financial and budgetary provisions. 

The  country  will  have  to  make  further  efforts  to  align  its  legislation  with  the  acquis  and  to 
effectively implement and enforce it in the medium term in the following fields: 

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Freedom of movement for workers; 
Right of establishment and freedom to provide services; 
Free movement of capital; 
Financial services; 
Consumer and health protection. 

The country will have to make considerable and sustained efforts to align its legislation with 
the acquis and to effectively implement and enforce it in the medium term in the following 
fields: 

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Public procurement; 
Company law; 
Information society and media; 
Agriculture and rural development; 
Food safety, veterinary and phytosanitary policy; 
Transport policy; 
Energy; 
Taxation; 
Social policy and employment; 
Regional policy and co-ordination of structural instruments; 
Justice, freedom and security; 
Customs union. 

Unless efforts are speeded up considerably, the country might not be able to comply with the 
requirements of the acquis in the medium term in the following fields: 

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Free movement of goods; 
Intellectual property law; 
Competition policy; 
Financial control. 

On the environment, very significant efforts will be needed, including substantial investment 
and  strengthening  of  administrative  capacity  for  the  enforcement  of  legislation.  Full 
compliance  with  the  acquis  could  be  achieved  only  in  the  long  term  and  would  necessitate 
increased levels of investment. 

C. 

CONCLUSION AND RECOMMENDATION 

•  The  former  Yugoslav  Republic  of  Macedonia  is  a  functioning  democracy,  with  stable 
institutions, generally guaranteeing the rule of law and respect of fundamental rights. The 
country signed a Stabilisation and Association Agreement (SAA) in 2001 and, since then 
has  generally  fulfilled  the  related  obligations  in  a  satisfactory  manner.  The  former 
Yugoslav Republic of Macedonia has successfully implemented the legislative agenda of 
the  Ohrid  Framework  Agreement  which  contributed  to  major  political  and  security 
improvements in the country. This legislation now needs to be fully enforced. The country 
remains committed to regional cooperation. The former Yugoslav Republic of Macedonia 

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needs  to  make  additional  efforts  in  particular  in  the  fields  of  electoral  process,  police 
reform,  judiciary  reform  and  the  fight  against  corruption.  On  the  basis  of  the  overall 
progress of reforms achieved, the Commission considers that the country is well on its way 
to  satisfy  the  political  criteria  set  by  the  Copenhagen  European  Council  in  1993  and  the 
Stabilisation and Association Process. 

•  The  former  Yugoslav  Republic  of  Macedonia  has  taken  important  steps  towards 
establishing  a  functioning  market  economy.  While  it  would  not  be  able  to  cope  with 
competitive pressure and market forces within the Union in the medium term, the country 
has initiated an economic reform path, which, if vigorously pursued, will allow it to do so 
in the future. 

•  The former Yugoslav Republic of Macedonia will be in a position to take on most of the 
obligations  of  membership  in  the  medium  term,  provided  that  considerable  efforts  are 
made  to  align  its  legislation  with  the  acquis,  particularly  to  ensure  implementation  and 
enforcement. Unless  efforts  are  speeded up considerably, the country may not  be able to 
comply  with  the  requirements  of  the  acquis  in  the  medium  term  in  the  areas  of  free 
movement  of  goods,  intellectual  property  law,  competition  policy  and  financial  control. 
Full compliance with the acquis in the field of environment could be achieved only in the 
long term, and would necessitate increased levels of investment. 

In  the  light  of  these  considerations,  and  taking  into  account,  in  particular,  the  substantial 
progress  made  by  the  country  in  completing  the  legislative  framework  related  to  the  Ohrid 
Framework  Agreement  of  2001,  and  following  four  years  of  implementation  of  the 
Stabilisation  and  Association  Agreement  (including  the  application  of  its  trade  related 
provisions  in  the  form  of  an  Interim  Agreement)  the  Commission  recommends  that  the 
Council  should  grant  the  status  of  candidate  country  to  the  former  Yugoslav  Republic  of 
Macedonia. This status is a political recognition of a closer relationship between the EU and 
the former Yugoslav Republic of Macedonia on its way towards membership. 

The Commission considers that negotiations for accession to the European Union should be 
opened  with  the  former  Yugoslav  Republic  of  Macedonia  once  it  has  reached  a  sufficient 
degree of compliance with the membership criteria. 

This  Opinion  is  accompanied  by  a  draft  European  Partnership  for  the  former  Yugoslav 
Republic of Macedonia which identifies the priorities which the country needs to address in 
preparing  for  the  opening  of  negotiations.  The  EU  will  continue  to  monitor  progress  of  the 
political reforms closely. The Commission will present a Report to the Council no later than 
the end of 2006 on the progress the former Yugoslav Republic of Macedonia has achieved. 

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