2008/784/EC: Council Decision of 2 October 2008 establishing a separate liability of Montenegro and reducing proportionately the liability of Serbia with regard to the long-term loans granted by the Community to the State Union of Serbia and Montenegro (formerly the Federal Republic of Yugoslavia) pursuant to Decisions 2001/549/EC and 2002/882/EC
Date: 2008-10-02
Institutions: Council of the European Union
Subjects: Community loan, EU relations, Serbia and Montenegro, financial agreement, financial aid

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(Acts adopted under the EC Treaty/Euratom Treaty whose publication is not obligatory)

II

DECISIONS

COUNCIL

COUNCIL DECISION

of 2 October 2008

establishing a separate liability of Montenegro and reducing proportionately the liability of Serbia
with regard to the long-term loans granted by the Community to the State Union of Serbia and
Montenegro (formerly the Federal Republic of Yugoslavia) pursuant to Decisions 2001/549/EC and
2002/882/EC

(2008/784/EC)

THE COUNCIL OF THE EUROPEAN UNION,

Having regard to the Treaty
Community, and in particular Article 308 thereof,

establishing the European

Having regard to the proposal from the Commission,

Having regard to the Opinion of the European Parliament (1),

Whereas:

(1)

(2)

Pursuant to Council Decision 2001/549/EC of 16 July
2001 providing macro-financial assistance to the Federal
Republic of Yugoslavia (2), the Community granted to the
Federal Republic of Yugoslavia a long-term loan of up to
EUR 225 million with a view to ensuring a sustainable
balance-of-payments
situation and strengthening the
country’s reserve position. The loan was fully disbursed
by the Commission in one instalment in October 2001.

of
Pursuant
5 November 2002 providing further macro-financial

Council Decision

2002/882/EC

to

(1) Opinion of 2 September 2008 (not yet published in the Official

Journal).

(2) OJ L 197, 21.7.2001, p. 38.

balance-of-payments

assistance to the Federal Republic of Yugoslavia (3), the
Community granted the Federal Republic of Yugoslavia a
loan of up to EUR 55 million with a view to ensuring a
sustainable
and
strengthening the country’s reserve position. The loan
fully disbursed by the Commission in three
was
instalments of respectively EUR 10 million in February
2003, EUR 30 million in September 2003 and EUR 15
million in April 2005.

situation

(3)

(4)

the State
According to the Constitutional Charter of
on
Serbia
of
Union
4 February 2003,
the Federal Republic of Yugoslavia
was reconstituted as the State Union of Serbia and
Montenegro.

and Montenegro

adopted

the State Union of Serbia

On 3 June 2006, based on Article 60 of the Constitu­
and
tional Charter of
Montenegro and following the Montenegrin referendum
of 21 May 2006, the Parliament of Montenegro passed a
declaration on the independence of the country, which
stated that Montenegro is an independent state with full
legal personality under international law.

(5)

The Parliament of Serbia adopted on 5 June 2006 a
decision that defined Serbia as the successor state to
the State Union of Serbia and Montenegro.

(3) OJ L 308, 9.11.2002, p. 25.

(6)

(7)

(8)

(9)

(10)

(11)

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The Council, in its conclusions of 12 June 2006, took
note of the declaration of the Parliament of Montenegro
and the decision of the Parliament of Serbia and stated
that the European Union and the Member States had
decided to develop further relations with Montenegro
as a sovereign and independent state.

(12) Montenegro or Serbia will not be entitled to any addi­
tional disbursement of macro-financial assistance under
this Decision.

(13)

The Commission consulted the Economic and Financial
Committee before submitting its proposal.

assets

and liabilities,

On 10 July 2006, Montenegro and Serbia entered into an
agreement on the regulation of membership in inter-
national financial organisations and the distribution of
financial
according to which
macro-financial assistance loans granted to the Federal
Republic of Yugoslavia or the State Union of Serbia
and Montenegro should continue to be serviced in the
proportion of 90 % for Serbia and 10 % for Montenegro,
unless other percentages are to be used on the basis of
the final beneficiary principle.

Montenegro and Serbia are, via the Central Bank of
Montenegro and the National Bank of Serbia, continuing
to discharge fully the debt servicing obligations stemming
from the Community loan operations.

According to Appendix 4 to the Agreement of 10 July
2006 between Montenegro and Serbia a total debt of
EUR 6 703 388,62 stemming from the macro-financial
assistance loans has been attributed to Montenegro.

(14)

The Treaty provides for no powers, other than those in
Article 308 thereof, for the adoption of this Decision,

HAS DECIDED AS FOLLOWS:

Article 1

and

assume

liability

separate

expenses

1. Montenegro shall
the
payments of principal and interest, as well as all and any
costs
EUR
6 703 388,62 out of the Community long-term loans of in
total EUR 280 million paid to the State Union of Serbia and
Montenegro (the
Federal Republic of Yugoslavia)
pursuant to Decisions 2001/549/EC and 2002/882/EC.

servicing of

to the

former

related

for

To this end, the Commission is authorised to sign, after
2.
consultation of
the Economic and Financial Committee, a
separate loan agreement with the authorities of Montenegro
for the amounts attributed to Montenegro and essentially on
the terms and conditions set out in the:

The two countries are discharging the debt servicing
in accordance with the 90:10 division
obligations
agreed between them, with the
exception of one
operation which is being serviced following the final
beneficiary principle (99,47 % for Serbia and 0,53 %
for Montenegro).

— Loan Agreement of 17 September 2001 between the
European Community and the Federal Republic of Yugo­
slavia,

the

relations

developed

between the
Considering
European Union and Montenegro as an independent
state, notably the European Partnership established by
Council Decision 2007/49/EC of 22 January 2007 on
the principles, priorities and conditions contained in
the European Partnership with Montenegro (1), and the
long period of time over which repayments are due to
take place, the Commission should be authorised to take
appropriate action to ensure that the liabilities arising
to Decisions
under
2001/549/EC and 2002/882/EC are divided between
Montenegro and Serbia in the proportions agreed bi-
laterally between the two countries.

pursuant

granted

loans

the

(1) OJ L 20, 27.1.2007, p. 16.

— Loan Agreement of 13 December 2002 between the
European Community and the Federal Republic of Yugo­
slavia,

— Supplemental Loan Agreement of 25 July 2003 between the
European Community and State Union of Serbia and
Montenegro, and

— Supplemental Loan Agreement of 7 April 2005 between the
European Community and State Union of Serbia and
Montenegro.

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In particular, the interest rate and the due dates for payment of
interest and repayment of principal shall be the same as those
set out in the borrowing contracts annexed to the agreements
referred to in this paragraph.

Article 3

1.
All related costs and expenses incurred by the Community
in concluding and carrying out the arrangements provided for
by Article 1 shall be borne by Montenegro.

3.
This Decision does not entitle Montenegro to any addi­
tional disbursement of macro-financial assistance from the
Community.

Article 2

Upon the signature of

the separate loan agreement
1.
between the Community and Montenegro referred to in
Article 1(2), Serbia’s
to the Community in its
capacity of successor state to the State Union of Serbia and
Montenegro shall be reduced accordingly.

liabilities

2.
All related costs and expenses incurred by the Community
in concluding and carrying out the arrangements provided for
by Article 2 shall be borne by Serbia.

Article 4

This Decision shall take effect on the third day following its
publication in the Official Journal of the European Union.

2.
The Commission is authorised to conclude with Serbia
arrangements to amend the existing loan agreements referred
to in Article 1(2).

Done in Luxembourg, 2 October 2008.

This Decision does not entitle Serbia to any additional
from the

of macro-financial

assistance

3.
disbursement
Community.

For the Council
The President

X. BERTRAND