COMMUNICATION FROM THE COMMISSION TO THE EUROPEAN PARLIAMENT AND THE COUNCIL Monitoring report on Croatia’s accession preparations
Date: 2012-04-24
Institutions: European Commission
Subjects: Croatia, EU Accession Treaty, EU control, accession criteria, competition policy, fundamental rights, public safety, right to justice

EUROPEAN COMMISSION 

Brussels, 24.4.2012  
COM(2012) 186 final 

COMMUNICATION FROM THE COMMISSION TO THE EUROPEAN 
PARLIAMENT AND THE COUNCIL 

Monitoring report on Croatia’s accession preparations 

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COMMUNICATION FROM THE COMMISSION TO THE EUROPEAN 
PARLIAMENT AND THE COUNCIL 

Monitoring report on Croatia’s accession preparations 

1. 

INTRODUCTION 

Accession negotiations with Croatia were closed, with the agreement of all Member States, in 
June 2011, as a result of Croatia fulfilling all the benchmarks set in the negotiating chapters. 
On this basis, the Accession Treaty was signed by Member States and Croatia on 9 December 
2011, and Croatia will become a Member of the European Union on 1 July 2013, subject to 
ratification by the national parliaments of all Members States.  

In the course of the negotiations, Croatia has agreed to a number of commitments, which have 
to  be  implemented  by  the  date  of  accession,  at  the  latest,  unless  specific  transitional 
arrangements have been agreed. 

According  to  Article  36  of  the  Act  of  Accession,  the  Commission  shall  closely  monitor  all 
commitments  undertaken  by  Croatia  in  the  accession  negotiations  focusing  in  particular  on 
competition  policy,  judiciary  and  fundamental  rights,  and  freedom  security  and  justice.  The 
Act  further  provides  that  as  an  integral  part  of  its  regular  monitoring  tables  and  reports  the 
Commission  shall  issue  six-monthly  assessments  up  to  accession  on  the  implementation  of 
these commitments undertaken by Croatia in these areas.  

In  line  with  Article  36  of  the  Act  of  Accession,  this  report  assesses  the  progress  made  by 
Croatia in its preparations for accession in the period 1 September 2011 to 29 February 2012, 
provides an overall assessment of the level of preparedness for membership and highlights the 
areas where further efforts are necessary in order for Croatia to be ready for membership on 1 
July 2013.  

This assessment is based on information gathered and analysed by the Commission, including 
input provided by Croatia, as well as information shared by Member States, international and 
civil society organisations  in their regular contacts with the Commission. The assessment is 
also  based  on  the  Commission's  findings  in  its  updated  Monitoring  Tables,  a  working  tool 
aimed at following up in detail on all commitments undertaken by Croatia in the context of 
the negotiations. The Monitoring Tables are updated every six months. 

Through this report, the Commission also wishes to assist Croatia in its further preparation for 
membership.  

2. 

COMMITMENTS AND REQUIREMENTS ARISING FROM THE ACCESSION NEGOTIATIONS 

2.1. 

Competition policy 

Croatia  is  generally  making  progress  towards  meeting  the  commitments  and  requirements 
arising from the accession negotiations for this chapter. Croatia can be considered broadly on 
track in its preparations for membership in the field of competition policy.  

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Croatia has pursued its efforts to build a positive enforcement record in the field of anti-trust, 
including  mergers  as  well  as  state  aid.  Croatia's  Competition  Agency  is  fully  operational 
and functionally independent;  it  carries out its duties in line with the legislation  in  force. A 
proper system of merger and state aid control is in place.  

With regard to Croatia's reporting obligations on the steel and shipbuilding sectors, the first 
reports have been submitted to the Commission in line with the requirements set during the 
negotiations. The first report on the steel industry, sent to the Commission on 15 December 
2011, is complete and fulfils Croatia's commitment to inform the Commission on the state of 
the recovery of state aid, plus compound interest, received by the steel mill CMC Sisak. CMC 
Sisak has yet to reimburse the aid received. In October 2011, the owners decided to close and 
sell the steel mill, resulting in production being completely halted. The report also provides 
updated information on the bankruptcy proceedings of the other steel mill, Željezara Split. 

On 16 January 2012, Croatia submitted the first six monthly report on the restructuring of the 
Croatian  shipyards  in  difficulty  as  requested  by  Annex  VIII  of  the  Act  of  Accession.  The 
report contains data on the measures taken to return  to viability, used aid, own contribution 
and  capacity  production,  following  the  methodology  on  monitoring  implementation  by 
Croatia  agreed  with  the  Commission  services.  The  report  also  provides  details  on  the 
agreements regulating property law.  

In  March  2012,  the  bid  for  the  shipyard  Brodosplit  was  accepted  and  Croatia  has  indicated 
that  the  privatisation  contract  will  be  finalised  without  delay,  and  submitted  to  the 
Commission for acceptance. However, the bids for the shipyards Kraljevica and Brodotrogir 
were  rejected  by  the  government  and  the  bid  for  the  shipyard  3.Maj  was  withdrawn  by  the 
potential  investor.  The  government  has  decided  to  initiate  the  bankruptcy  proceedings  for 
Kraljevica  and  to  seek  new  privatisation  and  restructuring  arrangements  for  3.Maj  and 
Brodotrogir within 90 days.  

•  Croatia  should  proceed  with  the  signing  of  the  privatisation  contract  for  Brodosplit  and 
with finding a solution for 3.Maj and Brodotrogir, as a matter of urgency in order to fulfil 
the requirements of the Treaty Annex on the restructuring of the shipyards by the date of 
Croatia's accession.  

Finally, as regards existing aid, Croatia has provided the Commission with a list of eleven aid 
measures that it wishes to be considered as existing aid upon the date of accession. Seven of 
these measures have been included in the Act of Accession. The remaining are being assessed 
by the Commission.  

2.2. 

Judiciary and fundamental rights 

Croatia is making progress towards meeting the commitments and requirements arising from 
the accession negotiations on this chapter, as outlined in Annex VII to the Act of Accession. 
Croatia can be considered broadly on track in its preparations for membership in the field of 
judiciary and fundamental rights.  

1) 

To  continue  to  ensure  effective  implementation  of  its  judicial  reform  strategy 
and action plan 

Implementation of the judicial reform strategy and action plan has continued generally in line 
with foreseen deadlines, including legislative fine-tuning in a number of areas. However, the 

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entry into force of the new system of public bailiffs, as part of the enforcement reform, which 
is an important element of the strategy, has been postponed (see also below under point 3). 

•  Croatia still needs to improve human resources planning, including for the long-term needs 

of the judiciary.  

2) 

To  continue  to  strengthen  the  independence,  accountability,  impartiality  and 
professionalism of the judiciary 

Implementation  of  the  various  measures  taken  in  2010  and  2011  to  strengthen  the 
independence, accountability, impartiality and professionalism of the judiciary has continued. 
The  reformed  State  Judicial  Council  (SJC)  and  State  Prosecutorial  Council  (SPC)  have 
continued to function independently. Both bodies have continued to appoint judicial officials 
based on transparent, uniform and objective criteria.  

•  However, improvements in the implementation of the transitional system of appointments 
of  judges  are  needed,  including  greater  transparency  of  marking  oral  interviews,  with 
attention paid to ensuring equal treatment of all candidates.  

The Judicial Academy continues to function well. However, enrolment of the second annual 
intake  to  the  State  School  for  Judicial  Officials  has  been  delayed.  The  SJC  has  begun 
implementation of the new system of assets declarations of judges. Disciplinary measures are 
being instigated against errant judicial officials.  

•  Secondary  legislation  needs  to  be  amended  to  limit  the  immunity  of  judges,  hence 
completing the legislative framework in this field and further guidance should be provided 
on the application of the code of conduct.  

•  The  SJC  and  SPC  need  to  be  provided  with  further  administrative  resources  to  function 
more  effectively,  including  as  regards  recruitment  procedures  and  functioning  of  the 
school,  the  systematic  and  accurate  checking  of  assets  declarations  and  pro-active 
application of disciplinary procedures. 

3) 

To continue to improve the efficiency of the judiciary 

Croatia  has  continued  to  implement  various  measures  aiming  at  improving  efficiency  of  the 
judiciary. The merger of courts as part of the court rationalisation process is continuing. The 
enforcement of court decisions has improved, in particular through the work of the financial 
agency FINA. The entry into force of the new system of public bailiffs has been postponed by 
six months to 1 July 2012. Some progress has been made with the physical infrastructure and 
computerisation  of  courts.  The  Integrated  Case  Management  System  is  operational  in  about 
60% of courts. Between December 2010 and December 2011, the overall number of pending 
cases increased by 5.2%. There is a continuing reduction in the backlog of old criminal cases, 
falling  by  12.3%  in  the  year  to  December  2011.  However,  the  number  of  old  civil  cases 
increased  by  6.5%  in  the  same  period,  while  the  number  of  old  civil  cases  at  first  instance 
courts fell by 9.5%.  

•  Attention needs to be paid to ensuring that higher courts, including the Supreme Court, are 
adequately equipped to handle the disproportionate increase as cases advance through the 
system.  

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The  new  system  of  administrative  justice  entered  into  force  on  1  January  2012,  albeit  with 
some delays in appointing the necessary staff.  

•  Croatia  needs  to  continue  to  implement  efficiency  measures  with  vigour,  in  particular  to 

ensure improved rates of case handling and reductions in the number of old cases.  

4) 

To continue to improve the handling of domestic war crimes cases 

Croatia has continued to process war crimes cases, with further arrests, indictments and court 
rulings,  including  in  priority  cases  identified  at  the  national  and  regional  level  linked  to  the 
2011  strategy  on  impunity.  Some  prominent  war  crimes  trials  began,  including  against  a 
former  Assistant  Interior  Minister  and  against  two  former  policemen  charged  with  killing 
Serb civilians in the "Grubori" case. More cases were transferred to the specialised chambers. 
Measures  have  been  taken  to  protect  witnesses  with  improved  witness  support  services  at 
certain  courts.  The  new  Government  has  taken  contact  with  Serbia  and  with  Bosnia  and 
Herzegovina  with  the  aim  of  addressing  the  potential  negative  implications  of  the  Law  on 
invalidation  of  certain  legal  acts  of  the  judicial  bodies  of  the  Former  Yugoslav  National 
Army,  the  former  Socialist  Federal  Republic  of  Yugoslavia  and  of  the  Republic  of  Serbia 
adopted by the outgoing Croatian Parliament in November 2011, on bilateral cooperation on 
war crimes cases.  

•  However,  tackling  impunity  for  war  crimes  remains  a  major  challenge  in  Croatia, 
especially as the majority of crimes have yet to be successfully prosecuted. Measures need 
to be taken to facilitate the attendance of witnesses at trial, especially in cases relocated to 
the specialised chambers.  

5) 

To  continue  to  ensure  a  sustained  track  record  of  substantial  results  based  on 
efficient, effective  and unbiased investigation, prosecution and court rulings in 
organised  crime  and  corruption  cases  at  all  levels  including  high  level 
corruption, and in vulnerable sectors such as public procurement 

An  adequate  legal  and  institutional  framework  remains  in  place  for  the  fight  against 
corruption  and  organised  crime  and  a  track  record  of  implementation  continues  to  be 
developed.  Law  enforcement  bodies  remain  active,  especially  on  higher  level  cases.  Recent 
developments  include  a  guilty  verdict  against  a  former  director  of  the  State-owned  power 
company,  further  indictments  against  local  mayors  (Dubrovnik)  and  County  Court  judges 
(Split) for abuse of office and an indictment for corruption against a political party. While the 
law  enforcement  bodies  continue  focusing  on  more  complex,  higher  level  cases,  the  overall 
number of cases being handled is reducing.  

•  Vigilance is required as regards local level corruption, in particular procurement cases. The 
implementation of the legal framework on the seizure and confiscation of assets needs to 
be reinforced across the board.  

•  Further attention is needed to the system of control of dismissal of criminal reports by the 

prosecutor.  

A number of senior appointments were made in the police by the outgoing administration.  

•  Appointments and further police reforms will require close attention, especially to ensure 

depoliticisation and increased professionalism.  

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6) 

To continue to improve its track record of strengthened prevention measures in 
the fight against corruption and conflict of interest  

As  regards  the  financing  of  political  parties  and  election  campaigns,  the  State  Electoral 
Commission,  the  supervisory  body,  was  strengthened  and  the  new  rules  from  2011  were 
applied without major difficulties in the general elections in December 2011, with only a few 
shortcomings identified. New rules on access to information are also being applied, with the 
first appeals reaching court.  

•  The  practice  of  applying  the  public  interest  test  for  classified  information  needs  to  be 

developed.  

Public  procurement  legislation  has  been  aligned  since  January  2012  with  the  spring  2011 
government  ordinance  providing  for  increased  transparency,  including  publication  of 
information  on  the  actual  execution  of  contracts.  Little  information  has  been  made  publicly 
available so far.  

•  Improved and stricter Conflict of Interest legislation was adopted in early 2011, however 
the new Conflict of Interest Commission has still not been appointed, thus protracting the 
implementation of the law. A system of verification of assets declarations and unjustified 
wealth remains to be strengthened.  

First steps taken by the new Government concerning conflict of interest rules are a cause of 
concern,  in  particular  as  regards  supervisory  and  management  boards  of  public  companies. 
Earlier provisions on criteria for membership have been overturned.  

•  Croatia  needs to ensure that  a strong  system is in  place  for preventing corruption in state 

owned companies. 

•  The concept of political accountability and zero tolerance of corruption needs to continue 

being developed.  

7) 

To  continue  to  strengthen  the  protection  of  minorities,  including  through 
effective  implementation  of  the  Constitutional  Act  on  the  Rights  of  National 
Minorities (CARNM) 

Protection of minorities has continued to improve, through the continued implementation of 
measures  for  the  protection  of  minorities,  including  the  constitutional  act  on  the  rights  of 
national minorities (CARNM). Eight members of parliament representing national minorities 
were  elected  in  December  2011.  Although  not  part  of  the  ruling  coalition,  cooperation 
between the political representatives of minorities and the government has started well. Some 
steps  have  been  taken  by  the  government  to  implement  the  May  2011  plan  for  minority 
employment for the period 2011-2014, under the CARNM.  

•  However, actual recruitment of minorities remains limited largely due to low recruitment 

levels. Stronger monitoring is required in this area.  

•  Croatia  also  needs  to  continue  to  foster  a  spirit  of  tolerance  towards  minorities,  in 
particular Croatian Serbs, and to take appropriate measures to protect those who may still 
be subjected to threats or acts of discrimination, hostility or violence. The Roma minority 
faces  particularly  difficult  living  conditions,  and  challenges  remain  in  the  areas  of 
education, social protection, health care, employment and access to personal documents. 

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8) 

To continue to address outstanding refugee return issues 

Further progress has been made with regard to housing issues. Housing care programmes for 
returnees continue to be implemented. 210 cases from the March 2011 plan for dealing with 
the  approximately  2,350  remaining  applications  have  been  settled,  out  of  which  86  families 
took  over  the  keys.  1,012  positive  approvals  for  housing  care  have  been  issued  so  far. 
Implementation  of  the  decision  on  validating  pension  rights  has  continued.  Croatia  has  also 
continued  to  engage  with  its  neighbours  in  the  Sarajevo  Process  where  progress  is  being 
made,  in  particular  on  a  major  regional  housing  project.  There  has  been  limited 
implementation  of  the  new  purchase  options  under  favourable  conditions  for  housing  care 
beneficiaries. 

9) 

To continue to improve the protection of human rights 

Human rights continue to be generally well respected.  

•  However, existing legal provisions need to be applied with more vigour.  

Croatia  has  further  developed  its  track  record  of  implementation  of  the  Anti-Discrimination 
Law and legislation on hate crimes.  

•  This needs to continue to develop, with attention paid to ensuring dissuasive sanctions are 

applied.  

In October 2011 a law was passed merging the Office of the Ombudsman with the Centre for 
Human  rights,  as  well  as  with  the  three  specialised  Ombudspersons  for  gender  equality,  for 
children  and  for  disabled.  In  February,  the  Constitutional  Court  decided  on  procedural 
grounds, that the law can not enter into force on 1 July 2012, as foreseen.  

•  Once  the  legislative  framework  is  in  place,  Croatia  should  ensure  that  the  merger  of  the 
offices  is  properly  implemented.  Particular  attention  should  be  paid  to  ensuring  that  a 
stronger human rights protection system emerges, and that adequate office premises, joint 
database and clear financing are assured.  

10) 

To continue to cooperate fully with the International Criminal Tribunal for the 
former Yugoslavia (ICTY) 

Croatia's  cooperation  with  the  ICTY  has  continued.  There  have  been  no  particular 
developments with respect to Croatia's investigations aimed at locating or determining the fate 
of  missing  military  documents  requested  by  the  Office  of  the  ICTY  Prosecutor.  Croatia's 
request  to  act  as  amicus  curiae  in  the  appeal  against  the  verdict  of  15  April  2011  against 
Croatian Generals Gotovina and Markač verdict was rejected by the Court.  

2.3. 

Justice, freedom and security  

Croatia is making progress towards meeting the commitments and requirements arising from 
the  accession  negotiations  for  this  chapter.  Croatia  can  be  considered  on  track  in  its 
preparations for membership in the field of justice, freedom and security.  

With regard to migration, a new Aliens Act was adopted on 28 October 2011 and has already 
entered into force, further aligning Croatian legislation with the acquis in this field.  

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•  However, a migration strategy ensuring a broader approach to protection of migrants and 
refugees has to be in place. Further efforts are needed to solve the problems related to the 
construction  of 
to 
unaccompanied minors.  

to  provide  adequate  assistance 

the  receptions  centres,  and 

In  the  field  of  asylum,  preparations  for  the  implementation  of  the  acquis  on  asylum  are 
moving forward. Since January 2012 the newly established administrative courts, for second 
instance cases, are fully operational. The Presidents of all four courts have been appointed, as 
well  as  20  judges  and  34  civil  servants.  In  2011,  the  number  of  asylum  requests  has 
considerably increased, requiring enhancement of administrative capacity in this field.  

•  In  particular,  transfer  of  know-how  from  the  Asylum  Commission  to  the  Administrative 

Courts needs to be ensured, as well as trainings for their new judges.  

As  for  visa  policy,  Croatia's  list  of  countries  whose  nationals  require  a  visa  to  enter  its 
territory, remains only partially aligned to that of the EU.  

•  As regards document security, efforts to manage the administration of biometric passports 
compliant with EU standards must continue, as well as to phase out identity cards issued 
before 2003 and amend the legal framework accordingly.  

With regard to external borders and Schengen, the process of alignment with the Schengen 
acquis  has  continued  by  further  improving  the  system  of  integrated  border  management. 
Interagency  cooperation,  as  well  as  coordination  with  the  neighbouring  countries  and  EU 
bodies in this field has advanced. 

Activities foreseen in the 2011 Integrated Border Management (IBM) Action Plan have been 
partly  implemented,  however,  some  delays  can  be  reported  on  procurement  of  certain 
technical equipment and on certain infrastructures. Amendments to the State Border Control 
Act were adopted in October 2011 to introduce the second line check; its implementation still 
needs  to  be  supported  by  proper  infrastructures.  A  system  of  risk  analysis  is  being 
implemented. Cooperation with FRONTEX has continued. Regular meetings take place with 
relevant authorities of the neighbouring countries, as well as joint patrols of border police. A 
common  contact  point  office  with Serbia  has  been  established  in  the  Border  Crossing  Point 
(BCP)  of  Bajakovo.  A  first  coordination  meeting  with  the  authorities  of  Bosnia  and 
Herzegovina (BiH), to implement the mutual agreement on state border control, was held in 
December  2011.  Discussions  with  both  countries,  as  well  as  with  Montenegro,  to  bring 
bilateral  agreements  on  local  border  traffic  in  line  with  the  EU  acquis,  are  advancing  and 
should be finalised before accession. The Free Transit Agreement with BiH should be brought 
in line with the EU acquis before accession. 

Border police numbers have increased and 308 border police officers have been recruited in 
2011. Specialised trainings for border police officers have not systematically been made part 
of  the  curriculum.  Installation  of  the  National  Border  Management  Information  System 
(NBMIS)  has  continued  in  33  additional  BCPs.  At  the  end  of  February  2012  it  was 
operational in 74 BCPs, 38 of which are located at future EU external borders; the system is 
not yet fully functional. At Neum, a 24 hour integrated border surveillance system is in place. 
Construction work on the new BCPs is delayed, but expected to be completed by the end of 
2012.  A  video  surveillance  system  for  the  green  border  in  Metkovic  is  operational.  A  first 
phase  of  establishing  the  National  Maritime  Centre  for  Information  Exchange,  allowing 
tracking and monitoring of vessels in the Croatian territory, has been completed.  

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•  The Centre needs to be reinforced with specialised and trained staff. The inter-connection 

with the radars of the relevant Ministries needs to be ensured.  

•  Implementation  of  the  IBM  Action  Plan  needs to  continue  on  time  and  delays  should  be 
properly  addressed.  A  comprehensive  plan  for  the  renovation  of  borders'  infrastructures 
should be prepared. 

In the areas of judicial cooperation in civil and criminal matters, an agreement on mutual 
execution of criminal judgments with Montenegro, as well as an extradition agreement with 
the Former Yugoslav Republic of Macedonia, were signed in October 2011. A working group 
has  been  formed  and  has  met  several  times  to  prepare  the  new  Act  on  international  private 
law.  Cooperation  with  the  European  Judicial  Network  in  civil  and  commercial  matters  has 
advanced.  

•  Efforts need to continue to align legislation and strengthen the institutional framework and 

the communication between authorities on judicial cooperation. 

With regard to police cooperation and the fight against organised crime, good cooperation 
with  Europol  has  continued.  Technical  preparations  and  staff  training  with  a  view  to  the 
establishment  of  the  Supplementary  Information  Request  at  the  National  Entry  (S.I.Re.N.E) 
Office  and  of  the  National  Office  for  the  Schengen  Information  System  (S.I.S.)  have 
advanced.  

•  However, the regulatory framework for these offices is still missing.  

Various trainings took place on the fight against organised crime, including on strengthening 
criminal  intelligence  analysis  and  on  anti-money-laundering.  A  monitoring  system  to  fight 
corruption in border management is in place.  

•  A new Law on police is currently being prepared; attention should be paid to ensure that 
the draft includes the criteria of transparency and equal treatment, according to the Strategy 
for the Management of Human Resources.  

The  track  record  on  organised  crime  has  continued  to  develop,  notably  with  a  number  of 
investigations and convictions in the field of drugs smuggling. 

•  The level of confiscated assets needs to be increased.  

•  Attention  should  be  paid  to  the  coordination  of  criminal  and  financial  investigations  as 
well as to the implementation of the legal framework in the field of fight against trafficking 
in human beings.  

The  capacities  of  the  national  police  office  for  the  suppression  of  corruption  and  organised 
crime (PNUSKOK) have been strengthened through ad-hoc staff trainings.  

•  Further  efforts  are  necessary  in  upgrading  equipments  and  facilities,  particularly  in  the 

Split department.  

Inter-agency cooperation on exchanging data on transactions of suspected money laundering 
and  terrorist  financing  is  now  facilitated  by  the  signature  of  an  annex  to  the  protocol  on 
cooperation between authorities dealing with corruption, organised crime and the associated 
crimes of money laundering and financing of terrorism.  

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2.4. 

Overview of state of play in the preparations in other acquis chapters 

In most areas of the acquis preparations for membership are well advanced. Preparations are 
almost complete in the field of freedom of movement for workers, company law, intellectual 
property rights, financial services, economic and monetary policy, statistics, trans-European 
networks,  science  and  research,  education  and  culture,  as  well  as  foreign  security  and 
defence policy.  

Croatia has achieved a good level of alignment, with a limited number of outstanding issues 
still remaining, in most of the acquis chapters.  

•  With regard to free movement of goods, Croatia must complete legislative alignment in the 
field of horizontal measures, as well as new and old approach product legislation. Urgent 
attention must be paid to the requirement imposed by Croatia for  additional intermediate 
storage  of  imported  petroleum  products,  which  constitutes  a  measure  having  an  effect 
equivalent to quantitative restriction, in violation of the acquis.  

•  As regards free movement of capital, further attention must be paid to the amendments to 
the  Act  on  Privatisation  of  INA  and  the  Act  on  Privatisation  of  Telecom;  efforts  to 
implement the action plan against money laundering must continue.  

•  With  regard  to  public  procurement,  attention  must  be  paid  to  legislative  alignment  in 
secondary legislation, especially in the field of defence procurement and also to the proper 
implementation of the newly adopted legislation, especially at local level, also in view of 
the future management of the structural funds.  

•  In the area of information society and media, the fee / tax measure on mobile services re-

introduced in January 2012 needs to be urgently abolished.  

•  In the field of transport policy, attention must be given to further legislative alignment in 
the areas of combined transport and to improving administrative capacity, in particular in 
relation to the functioning of the railway safety agency.  

•  With regard to energy, attention must be given to further legislative alignment in the areas 
of  the  internal  energy  market,  and  to  continue  the  liberalisation  process  of  the  electricity 
and gas markets.  

•  With regard  to taxation, Croatia needs to ensure that all relevant IT systems are in place 
and able to exchange information with the EU and other Member States as from the date of 
accession.  

•  In the field of social policy and employment, attention must be given to further legislative 
alignment  in  the  fields  of  anti-discrimination  and  equal  opportunities.  Structural 
weaknesses of the labour market as well as further capacity-building of social partners and 
further strengthening of administrative capacity across all areas must also be addressed.  

•  As regards enterprise and industrial policy, efforts are necessary to improve the business 

environment.  

•  In  the  field  of  consumer  and  health  protection,  continued  efforts  are  needed  in  order  to 
upgrade,  restructure  and  licence  facilities  for  handling  blood,  tissues  and  cells  in 
accordance with the EU technical requirements.  

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•  As regards customs union, Croatia needs to finalise the preparation and deployment of all 
the  IT  systems  required  for  interconnectivity  and  interoperability  with  the  EU  customs 
systems.  

•  With regard to external relations, Croatia needs to ensure the alignment of its international 

agreements with the acquis by accession.  

•  In  the  field  of  financial  control,  continued  efforts  are  needed  in  order  to  improve  the 
overall functioning of the public internal financial control and external audit at central and 
local level.  

•  In  the  field  of  financial  and  budgetary  provisions,  the  coordination  department  needs  to 
continue  building  up  its  capacity  to  coordinate  the  overall  system  of  own  resources 
efficiently  after  accession.  The  modernisation  of  the  customs  control  strategy  focusing 
more on post-clearance controls needs to be stepped up. 

Croatia  has  achieved  a  generally  good  level  of  alignment  also  in  the  six  remaining  acquis 
chapters, but increased efforts are needed in some domains.  

•  With regard to right of establishment and freedom to provide services, preparations are on 
track. However, efforts need to be focused on the implementation of the Services Act.  

•  As  for  agriculture  and  rural  development,  attention  must  be  given  to  further  legislative 
alignment and strengthening of administrative capacity in the areas of direct payments and 
rural development.  

•  With regard to food safety, veterinary and phytosanitary policy, attention must be paid to 
the construction and equipment of border inspection posts in time and the upgrading of the 
establishments for the handling and processing of milk, meat, fish and animal by-products. 
Continued attention needs to be paid to the further strengthening of administrative capacity 
in this area.  

•  In  the  field  of  fisheries,  attention  must  be  given  to  further  legislative  alignment  and 
implementation  of  the  acquis  in  the  areas  of  resources  and  fleet  management,  inspection 
and  control  as  well  as  structural  measures,  in  particular  as  regards  the  preparation  of  the 
management plans, the phasing out of the category of subsistence fisheries as well as the 
completion of the satellite based vessel monitoring system. Continued attention needs to be 
paid  to  the  further  strengthening  of  administrative  capacity,  especially  as  regards  the 
recruitment and training of fisheries inspectors.  

•  With  regard  to  regional  policy  and  coordination  of  structural  instruments,  further 
sustained  efforts  need  to  focus  on  effectively  implementing  the  plans  to  increase 
administrative capacity for future cohesion policy implementation and to develop a mature 
project pipeline.  

•  With  regard  to  environment,  significant  attention  must  be  given  to  further  legislative 
alignment  and  implementation  in  the  areas  of  the  horizontal  acquis  and  climate  change. 
Particular  attention  needs  to  be  paid  to  the  effective  public  participation  and  access  to 
justice in environmental matters, and, in so far as climate change is concerned, to complete 
the legislative alignment and to ensure implementation, in particular for the EU Emissions 
Trading System.  

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Finally,  the  Commission  calls  on  the  Croatian  authorities  to  accelerate  work  on  the 
translation  and  revision  of  the  acquis,  which  must  be  completed  before  the  date  of 
accession in order to ensure legal certainty in the implementation of EU legislation. 

3. 

CONCLUSIONS 

Overall,  Croatia's  preparations  for  EU  membership  are  on  track.  Croatia  has  reached  a 
considerable  degree  of  alignment  with  the acquis.  Further  progress  has  been  achieved  since 
the  2011  progress  report  and  the  last  update  of  the  monitoring  tables  in  autumn  2011. 
Nevertheless  the  Commission  has  identified  a  limited  number  of  issues  requiring  further 
efforts. The Croatian authorities need to take all necessary measures to ensure that the country 
is fully prepared for membership by 1 July 2013, in the interest of Croatia and the EU.  

The  Commission  will  continue  monitoring  the  fulfilment  of  the  commitments  taken  by 
Croatia  in  the  context  of  accession  negotiations  focusing  on  the  issues  identified  in  the 
monitoring  tables  and  reflected  in  this  report  and,  if  circumstances  would  so  warrant,  make 
use of the instruments available under Article 36 of the Act of Accession. 

In  accordance  with  that  Article,  the  Commission  will  present  a  Comprehensive  Monitoring 
Report to the European Parliament and the Council, as well as an update of the Monitoring 
Tables, in autumn 2012. 

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