COMMUNICATION FROM THE COMMISSION TO THE EUROPEAN PARLIAMENT AND THE COUNCIL on a Feasibility Study for a Stabilisation and Association Agreement between the European Union and Kosovo(
Date: 2012-10-10
Institutions: European Commission
Subjects: Community acquis, Kosovo, administrative reform, economic reform, health control, judicial reform, market economy, political reform, protection of minorities, stabilisation and association agreement

EUROPEAN 
COMMISSION 

Brussels, 10.10.2012  
COM(2012) 602 final 

COMMUNICATION FROM THE COMMISSION TO THE EUROPEAN 
PARLIAMENT AND THE COUNCIL 

on a Feasibility Study for a Stabilisation and Association Agreement between the 
European Union and Kosovo∗ 

{SWD(2012) 339 final} 

∗ 

This designation is without prejudice to positions on status, and is in line with UNSCR 1244/1999 and 
the ICJ Opinion on the Kosovo declaration of independence.

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COMMUNICATION FROM THE COMMISSION TO THE EUROPEAN 
PARLIAMENT AND THE COUNCIL 

on a Feasibility Study for a Stabilisation and Association Agreement between the 
European Union and Kosovo∗ 

1. 

INTRODUCTION 

The  main  principles  of  the  Stabilisation  and  Association  Process  (SAP)  were  set  out  in  a 
Commission Communication of May 19991 and were confirmed by the Council in June 1999. 
Through  this  process,  the  European  Union  (EU)  expresses  its  determination  to  take  up  the 
challenge  and  responsibility  to  contribute  to  the  stability  of  the  Western  Balkans  region.  In 
return  for  compliance  with  the  relevant  conditions,  the  EU  offers  the  countries  tailor-made 
contractual  relations:  Stabilisation  and  Association  Agreements.  The  conditions  for 
establishing  contractual  relations  with  the  Western  Balkans  countries  are  set  in  the  Council 
Conclusions  of  April  1997.  The  main  elements  include  a  credible  engagement  to  undertake 
democratic reforms, respect and protect human rights, minorities and freedom of expression, 
and free and regular elections. The Council also expects implementation of the first economic 
reforms, readmission from Member States and commitment to the regional cooperation. 

The Feira European Council (June 2000) gives a clear signal to the Western Balkans region 
establishing  the  status  of  potential  candidates  for  membership.  This  message  is  further 
reinforced by the summit in Zagreb (November 2000). The European Council Conclusions of 
March 2003 state that the future of the Western Balkans is within the EU and strong political 
will and sustained efforts are required to secure it. The Thessaloniki agenda for the Western 
Balkans  of  June  2003  makes  clear  that  the  Western  Balkans  countries  and  support  to  their 
preparation  for  the  future  integration  into  the  European  structures  and  ultimate  membership 
into the Union is a high priority for the EU.  

To date, feasibility studies have been prepared for Albania, Bosnia and Herzegovina, Croatia, 
the  former  Yugoslav  Republic  of  Macedonia,  Serbia  and  Montenegro.  Stabilisation  and 
Association  Agreements  have  subsequently  been  signed  with  all  these  countries.  The 
December  2011  Council  recalls  the  EU's  willingness  to  assist  the  economic  and  political 
development  of  Kosovo  through  a  clear  European  perspective,  in  line  with  the  European 
perspective of the region. The Council underlines the need to take concrete steps to that effect. 
In  February  2012,  the  Council  takes  note  of  the  intention  of  the  Commission  to  launch  the 
feasibility study for a Stabilisation and Association Agreement between the European Union 
and Kosovo, without prejudice to Member States' position on status, or any future decisions to 
be taken by the Council.  

In  the  context  of  the  Council  Conclusions  of  February  2012,  the  Commission  made  a 
Declaration  stating  that  "the  Commission's  feasibility  study  will  examine  whether  the 
political,  economic  and  legal  criteria  for  a  Stabilisation  and  Association  Agreement  are 

∗ 

1 

This designation is without prejudice to positions on status, and is in line with UNSCR 1244/1999 and 
the ICJ Opinion on the Kosovo declaration of independence. 
COM(1999) 235 final. 

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fulfilled.  The  launch  of  the  feasibility  study  for  a  Stabilisation  and  Association  Agreement 
with  Kosovo  is  without  prejudice  to  the  legal  status  and  Member  States'  positions  on  the 
recognition of Kosovo". 

Methodology 

This study is based on the findings presented in the Commission Staff Working Document.2 
This has been compiled on the basis of a questionnaire completed by the Kosovo authorities, 
an  assessment  mission  of  20  experts,  contributions  from  the  EU  Office  in  Pristina, 
international  organisations  and  non-governmental  organisations.  The  study  assesses  whether 
Kosovo is ready to negotiate and subsequently can implement a Stabilisation and Association 
Agreement.  The  document  identifies  priority  issues  to  be  addressed  before  negotiations  can 
start and priority areas that Kosovo would need to address to be able to meet its obligations 
under a Stabilisation and Association Agreement. 

Legal aspects 

The possibility for the Union to conclude international agreements is not limited to generally 
recognised  independent  states  or  international  organisations.  Such  agreements  can  be 
concluded with any entity with regard to which the other Contracting Party accepts that it can 
enter into an agreement that will be governed by public international law. In the past, the EU 
has concluded several international agreements with entities other than sovereign states. 

These  agreements  were  concluded  by  the  Council on the basis  of  Article 218  Treaty  on  the 
Functioning of the EU (TFEU) (or the predecessor articles, Article 300 -and previously 228- 
EC). In this context, it is important to note that the use of Article 218 TFEU, as the legal basis 
for an agreement with Kosovo, does not constitute recognition of Kosovo by the Union as an 
independent state nor does it constitute recognition by individual Member States of Kosovo, 
provided  that  an  express  reservation  to  that  effect  is  made.  Equally,  it  does  not  constitute  a 
reversal of recognition by the Member States which have already recognised. 

There is no legal obstacle for the Union to conclude on that basis an association agreement 
with  Kosovo.  There  is  no  precise  definition  of  that  notion  in  EU-law:  Article  217  TFEU 
indicates  that  such  an  agreement  establishes  "an  association  involving  reciprocal  rights  and 
obligations, common action and special procedure". It follows from the Union's practice that 
association  agreements  create  special,  privileged  links  with  a  third  country.  In  particular, 
association  agreements  always  lay  much  emphasis  on  the  shared  values  and  principles, 
comprise an important trade component, provide for approximation of the country's national 
legislation  and  policies  with  all  core  policies  of  the  Union,  and  organise  cooperation  on 
almost any area of Union competence. The association is developed through an institutional 
framework,  which  not  only  includes  a  decision-making  mechanism,  but  provides  also 
intensive dialogue at civil service level. 

Consequently, the Union can conclude such an agreement with a third country if its political 
and  judicial  authorities  are  capable  to  ensure  that  the  terms  of  the  agreement  are  respected, 
applied  and  implemented.  It  is  precisely  the  purpose  of  this  feasibility  study  to  examine 
whether the political and economic development of Kosovo would allow it to undertake the 
extensive obligations of an association agreement. From the legal point of view, however, it 
suffices  to  find  that  the  fact  that  some  Member  States  do  not  recognise  Kosovo  as  an 

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SWD(2012) 339 final. 

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independent state does not constitute a legal obstacle for the Kosovo authorities to implement 
the obligations that would arise from an association agreement. The association of Kosovo to 
the European Union is not in conflict with the fact that the Member States of the Union have 
different  positions  on  the  status  of  Kosovo  under  international  law.  Moreover,  the  precise 
legal nature of the agreement would have to be determined at the end of the negotiations, in 
view of its actual content and taking duly into account the legal context.  

The  international  presence3  in  Kosovo  does  not  constitute  an  obstacle  for  the  Kosovo 
authorities  to  implement  the  obligations  arising  from  a  Stabilisation  and  Association 
Agreement.  Such  an  agreement  would  not  be  in  contradiction  with  the  United  National 
Security Council Resolution 1244 of 1999 and is consistent with the current presence of the 
United Nations Interim Administration Mission in Kosovo. 

The  International  Civilian  Office  (ICO)  was  set  up  to  supervise  the  implementation  of  the 
Comprehensive  Proposal  for  a  Status  Settlement  for  Kosovo.  On  10  September,  the 
International  Steering  Group  (ISG),  having  determined  that  Kosovo  had  substantially 
implemented  the  terms  of  the  Comprehensive  Settlement  proposal  and  Kosovo  having 
adopted the necessary constitutional and legal framework, declared the end of the supervision 
of  Kosovo's  independence,  and  the  end  of  the  mandate  of  the  International  Civilian 
Representative. As a consequence, the International Civilian Office will be closed by the end 
of 2012. Following this process, the EU will take on a more prominent role in Kosovo. 

The central aim of the EU rule of law mission, EULEX, is to assist and support the Kosovo 
authorities  in  key  areas  of  the  rule  of  law  –  police,  judiciary  and  customs.  Its  mandate  has 
certain  executive  responsibilities.  If  an  association  agreement  were  concluded,  this  EU 
mission would, within its remit, support the Kosovo authorities in the implementation of such 
an agreement. 

Aspects related to the north of Kosovo 

The  north  of  Kosovo 
the  municipalities  of 
the  part  of 
Leposaviq/Leposavić,  Zubin  Potok  and  Zveçan/Zvečan  as  well  as 
Mitrovicë/Mitrovica  municipality  north  of  the  river  Ibër/Ibar.  This  area  is  predominantly 
inhabited by Serbs.  

to  an  area  which 

includes 

refers 

Serbia  has  continued  to  fund  and  maintain  certain  structures  in  this  part  of  Kosovo.  This 
includes not only hospitals and schools, but also municipal administrations, security services 
and  judicial  structures.  Currently,  the  Mitrovica  District  Court  can  only  operate  with  the 
support of EULEX judges. The Serbian power utility maintains an unlicensed branch in the 
north, unlicensed Serbian mobile telephony companies continue to operate and the population 
in the north frequently uses alternative roads to cross the border/boundary line.  

The  north  of  Kosovo  faces  a  difficult  economic  situation.  The  local  population  is  overly 
dependent  on  public  employment  and  social  assistance  financed  by  Belgrade.  The  area's 

3 

It can be recalled that the presence in Bosnia and Herzegovina of a High Representative, supported by 
the  Office  of  the  High  Representative  (OHR),  appointed  by  the  Peace  Implementation  Council  to 
oversee  the  civilian  implementation  of  the  Dayton  Peace  Agreement,  was  not  considered  a  legal 
impediment  for  the  signature  of  a  Stabilisation  and  Association  Agreement  between  the  European 
Union and Bosnia and Herzegovina. 

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potential  in  terms  of  natural  resources,  such  as  the  Trepça/Trepča  mine,  remains  largely 
under-developed. 

In 2011, a census was conducted across Kosovo, but it did not include data on these parts of 
Kosovo.  At  the  time  of  the  last  Kosovo  elections,  the  turnout  in  these  municipalities  was 
extremely  low.  In  May  2012,  the  municipalities  of  Zubin  Potok  and  Zveçan/Zvečan 
unilaterally  organised  separate  local  elections  at  the  same  time  as  elections  were  held  in 
Serbia. These elections were not recognised by Pristina, Belgrade or international community.  

Following  the  deployment  of  Kosovo  police  and  customs  to  the  border/boundary  crossing 
points  over  the  summer  2011,  a  number  of  barricades  were  erected.  Most  have  now  been 
dismantled. There is still a barricade on the main bridge across the Ibër/Ibar river. The current 
situation  with  outbursts  of  violence  and  frequently  heightened  tensions  is  not  sustainable. 
KFOR and EULEX have an important role to play in helping maintain calm.  

Belgrade/Pristina dialogue 

The  situation  in  the  north  of  Kosovo  remains  a  challenge  for  Kosovo,  Serbia,  Western 
Balkans  region  and  international  community.  Following  the  UN  General  Assembly 
Resolution  of  September  2010,  the  EU  has  facilitated  a  dialogue  between  Pristina  and 
Belgrade.  The  dialogue  was  launched  in  March  2011  to  promote  cooperation,  achieve 
progress on the path to the European Union and improve the lives of the people. To date, the 
parties have reached agreements on free movement of persons, customs stamps, recognition 
of  university  diplomas,  cadastre  records,  civil  registries,  IBM  and  on  regional  cooperation. 
Both Kosovo and Serbia need to continue implementing in good faith all agreements reached 
to date and to engage constructively on full range of issues with the facilitation of the EU. 

Further  progress  on  the  issues  in  the  north  will  require  all  relevant  actors  involved  to  work 
together in a constructive spirit. The Kosovo authorities need to do their part. They need to 
promote  a  multi-ethnic  Kosovo  and  to  respect  the  particular  needs  of  the  local  population. 
Kosovo has continued preparing an agenda for the north in line with the Council Conclusions 
of December 2011. Non-Serb minorities in the north will also benefit from normalisation in 
this part of Kosovo.  

The  current  situation  is  challenging  and  needs  to  be  urgently  improved.  In  this  regard,  the 
Commission considers that the benefits of a Stabilisation and Association Agreement would 
serve as an encouragement for the population of all of Kosovo, including the north.  

2. 

RELATIONS BETWEEN THE EUROPEAN UNION AND KOSOVO 

Kosovo has gradually strengthened its structures dealing with European integration processes. 
Kosovo has established a National Council for EU Integration chaired by the President. The 
objective  of  this  National  Council  is  to  mobilise  Kosovo  institutions  to  deliver  on  its  EU 
reform  agenda.  The  Ministry  of  European  Integration  leads  a  Task  Force  for  European 
Integration.  The  Ministry  has  demonstrated  a  good  ability  to  mobilise  other  ministries  and 
institutions by coordinating a comprehensive contribution of Kosovo to the preparation of this 
feasibility study.  

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Review of the 2009 Communication on Kosovo – Fulfilling its European perspective4 

the  Commission 

In  2009, 
included 
recommendations  for  a  number  of  practical  steps  the  EU  could  take  to  ensure  Kosovo's 
continued progress towards Europe.  

issued  a  Communication  on  Kosovo,  which 

The  EU  has  launched  a  visa  liberalisation  dialogue  and  presented  the  visa  liberalisation 
roadmap  to  the  Kosovo  authorities;  the  Kosovo  authorities  have  now  submitted  their  first 
report.  The  EU  agreed  to  extend  the  Autonomous  Trade  Measures  for  Kosovo  in  2011. 
Kosovo has also been included in the Convention on Pan-Euro-Med Cumulation of Origin, in 
which  it  can  actively  participate  once  a  trade  agreement  is  in  place.  Kosovo  continues  to 
prepare  for  integration  into  the  economic  and  fiscal  surveillance  framework.  In  December 
2011,  the  Council  recognised  that  Kosovo's  socio-economic  development  would  also  be 
enhanced through membership of the European Bank for Reconstruction and Development.  

In  March  2011,  the  Commission  recommended  to  the  Council  to  authorise  it  to  negotiate  a 
framework  agreement  allowing  Kosovo  to  participate  in  EU  programmes.  The  Commission 
and  Kosovo  have  completed  three  cycles  of  the  Stabilisation  and  Association  Process 
Dialogue. This Dialogue has proven an effective mechanism to monitor and advise Kosovo on 
measures  it  has  to  take  to  implement  its  European  reform  agenda.  This  mechanism  also 
provides for consultations with civil society organisations.  

Kosovo benefits from the Instrument for Pre-Accession Assistance cross-border cooperation 
programmes  with  Albania,  the  former  Yugoslav  Republic  of  Macedonia  and  Montenegro. 
Kosovo's  allocations  for  Erasmus-Mundus,  Tempus  and  the  Young  Cell  scheme  under  the 
Instrument  have  increased.  Overall,  within  the  2007-2013  framework,  € 635.4  million  is 
available to Kosovo.  

Jointly with the Kosovo authorities, the Commission launched a Structured Dialogue on the 
Rule of Law. This demonstrates the political commitment of the Kosovo authorities and the 
Commission to address challenges in this area early in the enlargement process. 

EU presence in Kosovo 

The  double-hatted  office  of  the  EU  Special  Representative  and  the  International  Civilian 
Representative  has  been  decoupled.  The  office  of  the  EU  Special  Representative  and  the 
European  Commission  Liaison  Office  have  been  merged  into  one  EU  Office.  This  has 
enhanced the EU's presence and visibility in Kosovo. To reflect increasing capacities of the 
Kosovo authorities, the mandate of EULEX has been reconfigured and downsized. To assist 
the  Kosovo  authorities  in  facing  the  remaining  challenges,  its  mandate  has  been  extended 
until  June  2014.  Kosovo  needs  to  maintain  good  cooperation  with  the  mission  and  actively 
support  the  implementation  of  its  mandate.  The  Commission  is  cooperating  closely  with 
EULEX throughout its reconfiguration to ensure a smooth transition and sustained support to 
the Kosovo authorities.  

Kosovo in the regional context 

Kosovo participates in the Regional Cooperation Council, the Energy Community Treaty, the 
South  East-Europe  (SEE)  Transport  Observatory  and  CEFTA,  and  is  ready  to  participate  in 

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COM(2009) 534 final. 

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other  regional  initiatives.  The  formula  for  Kosovo's  participation  in  regional  cooperation 
arrangements agreed in February 2012 is a good basis for Kosovo to increase and extend its 
direct  participation  in  these  mechanisms.  These  include  the  Transport  Community  Treaty, 
judicial  cooperation,  and  arrangements  for  employment  and  social  policies  within  the 
framework of SEE Employment and Social Policy Network and the SEE Health Network. It 
should also ensure Kosovo's full participation in the Roma Decade.  

3. 

ASSESSMENT 

3.1. 

Political issues 

Kosovo's  political  system  is  based  on  the  principles  of  a  parliamentary  democracy.  These 
principles are enshrined in its constitution and legal framework. Over the past three years, the 
functioning  of  democratic  institutions  and  the  respect  for  the  rule  of  law  have  been 
consolidated. The necessary institutions have been established. 

The  president,  government  and  parliament  are  the  main  institutions  responsible  for  driving 
forward  the  reform  process.  The  Constitutional  Court  has  played  an  important  role  in 
guaranteeing  democratic  principles  and  respect  of  the  constitution,  for  example  through  its 
judgements on the mandate of the current President. The cooperation on legislation between 
the  government  and  the  parliament  has  also  been  gradually  improving.  Kosovo  has 
demonstrated  sufficient  commitment  to  the  democratic  principles  of  governance  to  start 
negotiating a Stabilisation and Association Agreement. To meet its obligations under such an 
agreement,  Kosovo  needs  to  continue  to  implement  democratic  reforms.  In  particular,  the 
Assembly  and  its  committees  need  to  strengthen  their  oversight  of  the  executive  and  the 
security sector, through improved scrutiny of legislation and monitoring of implementation of 
policies  and  laws.  The  financial  and  administrative  independence  of  the  Assembly  from  the 
government  needs  to  be  strengthened.  This  can  be  achieved  through  adopting  legislation  on 
the status of civil servants of the Assembly. It is also important to ensure that the draft budget 
of the Assembly is modified by the government in consultation with the Assembly before the 
government submits the budget proposal to the Assembly for adoption. 

Kosovo has held regular elections at both central and municipal levels. The electoral system 
allows for competition between different political parties and free choice for voters. This has 
resulted in a differing composition of governing coalitions over time. The most recent general 
elections  in  2010/2011  demonstrated  that  new  political  parties  can  enter  the  Assembly. 
Kosovo is ready to start negotiating a Stabilisation and Association Agreement. At the same 
time,  these  elections  were  marked  by  serious  shortcomings  and  technical  difficulties. 
Therefore,  Kosovo  needs  to  ensure  that  the  legal  framework  improves  to  better  reflect  best 
practices and standards in the EU to meet its obligations under such an agreement. 

On  the  rule  of  law,  the  legal  framework  is  complex,  including  legislation  from  the  former 
Yugoslavia  and  from  the  Federal  Republic  of  Yugoslavia,  UNMIK  legislation  and  new 
Kosovo legislation. Some elements of the  necessary legislative reforms for the fight against 
organised  crime  have  been  put  in  place.  Several  important  laws  are  still  missing  or  need 
amendment, notably in the area of money laundering and asset confiscation. In the short term, 
Kosovo  needs  to  demonstrate  a  clear  commitment  to  deliver  results  in  the  fight  against 
organised  crime,  including  launching  investigations,  in  close  coordination  with  EULEX. 
Kosovo needs to adopt new legislation on confiscation of assets and adapt to the acquis the 
law on the prevention of money laundering and financing of terrorism.  

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Enforcement  of  the  legal  framework  for  the  fight  against  various  forms  of  organised  crime 
remains an important challenge. For Kosovo to meet its obligations under a Stabilisation and 
Association Agreement, concrete evidence of results in fighting organised crime needs to be 
given  as  a  matter  of  priority.  Kosovo  also  needs  to  continue  in  strengthening  and 
implementing  its  legislation  particularly  on  prevention  and  fighting  against  trafficking  in 
human beings, drugs, their precursors and weapons trafficking. Kosovo also needs to improve 
the reliability of its statistics.  

Kosovo  has  put  in  place  important  elements  of  the  legislative  framework  necessary  for  the 
fight  against  corruption.  Examples  include  legislation  on  declaration  of  assets,  preventing 
conflicts  of  interest  in  exercising  public  functions,  whistle-blowers,  public  procurement  and 
financing of political parties. It is important that Kosovo now achieves tangible results in this 
area. 

Over  the  past  three  years,  the  prosecution  service  and  the  police  have  been  reorganised  to 
strengthen  their  capacity  to  tackle  corruption.  Kosovo  also  has  an  Anti-Corruption  Agency 
with  the  right  of  administrative  investigation  and  reporting.  The  capacity  of  the  Agency 
corresponds  to  its  responsibilities.  In  the  short  term,  Kosovo  needs  to  demonstrate  a  clear 
commitment  to  deliver  results  in  the  fight  against  corruption,  including  launching 
investigations,  in  close  coordination  with  EULEX.  Kosovo  needs  to  adopt  a  new  anti-
corruption strategy.  

To meet its obligations under a Stabilisation and Association Agreement, Kosovo also needs 
to effectively implement its anti-corruption legislation and establish an effective mechanism 
for  prevention  of  corruption.  As  a  matter  of  priority,  Kosovo  needs  to  provide  concrete 
evidence of results in its fight against corruption. This would include successful investigations 
and prosecutions of appointed and elected officials guilty of corruption. Kosovo also needs to 
improve the reliability of the statistics in this area. 

The Council Conclusions of April 1997 underline the importance of satisfactory readmission 
procedures.  Within  the  framework  of  the  visa  liberalisation  process,  Kosovo  has  adopted  a 
law  on  readmission  and  continues  to  cooperate  on  readmission  issues  with  EU  Member 
States.  It  needs  to  fully  implement  its  law  on  readmission  and  needs  to  ensure  the 
reintegration of the returned persons. 

Over  the  past  three  years,  Kosovo  has  adopted  legislation  for  major  judicial  reforms.  The 
principles of impartiality, independence, accountability and efficiency are at the heart of this 
reform.  The  reforms  change  the  structure  of  the  court  system  and  the  prosecution.  A 
Prosecutorial  Council  has  been  established  and  the  Judicial  Council  has  been  strengthened. 
Key institutions of the judiciary are in place, although in the court in northern Mitrovica only 
EULEX judges are present. They have progressively increased their capacity and have a good 
understanding of how to take these reforms forward. The efforts made to reduce the backlog 
of old cases are now slowly showing results. While implementing the new structure of courts, 
Kosovo needs to ensure that the Special Prosecution responsible for cases of organised crime, 
war crimes and corruption maintains its competencies. 

It is clear that Kosovo faces many important challenges in this area. To meet its obligations 
under  a  Stabilisation  and  Association  Agreement,  Kosovo  needs  to  continue  improving  the 
effectiveness,  accountability  and  impartiality  of  the  judiciary.  It  needs  to  successfully 
implement  the  four  main  judicial  reform  laws,  including  by  ensuring  their  consistency. 
Kosovo needs to take measures to decrease the total backlog of cases. The Kosovo authorities 

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need  to  provide  appropriate  security  and  protection  to  judges,  prosecutors,  witnesses  and 
plaintiffs,  as  well  as  court  staff.  Kosovo  needs  to  ensure  trials  are  conducted  in  appropriate 
premises  and  in  line  with  court  procedures.  Recruitment  of  judges  and  prosecutors  from 
minorities, as set out in the legislative framework, needs to continue. 

The  legal  framework  providing  for  the  basic  conditions  for  a  stable  and  professional  civil 
service  is  largely  in  place.  Legislation  is  inspired  by  the  latest  approaches  to  public 
administration in Europe. The capacity of the public administration at the central level are 
better developed than those at the municipal level. Kosovo has also established the institution 
of the Ombudsperson, which is a key independent body to promote human and fundamental 
rights.  The  Ombudsperson  however  faces  challenges,  notably  in  terms  of  budget  and 
premises. 

In the short term, Kosovo needs to adopt the necessary secondary legislation on civil service 
and  on  salaries  for  the  civil  service.  Furthermore,  it  needs  to  allocate  premises  to  the 
Ombudsperson  and  to  ensure  its  budgetary  independence.  The  government  needs  to  include 
the Ombudsperson's draft budget proposal without modifications into the global draft budget 
submitted to the parliament. 

At the same time, Kosovo needs to continue to implement the necessary reform of the public 
administration.  To  meet  its  obligations  under  a  Stabilisation  and  Association  Agreement, 
Kosovo needs to make progress in implementing the public administration strategy and action 
plan and related legislation. It also needs to ensure sustainable public administration reform, 
including the necessary funding and staffing. The share of persons belonging to minorities in 
the  public  administration  needs  to  be  increased.  An  efficient  and  professional  public 
administration is key for the successful implementation of an agreement.  

The constitution of Kosovo and the overall legislative framework provide guarantees for basic 
human  rights  and  the  protection  of  minorities.  Although  Kosovo  is  not  a  member  of  the 
UN or the Council of Europe, its constitution stipulates that key UN and Council of Europe 
conventions  and  protocols  are  directly  applicable  in  Kosovo  and  take  precedence  over 
Kosovo's  legislation.  Over  the  past  three  years,  Kosovo  has  taken  steps  to  implement  these 
provisions in practice.  

There  are  important  challenges  that  need  to  be  addressed  by  Kosovo  in  order  to  meet  its 
obligations  under  a  Stabilisation  and  Association  Agreement.  This  area  is  particularly 
important in light of the new EU Strategic Framework and Action Plan on Human Rights and 
Democracy adopted by the Council in June 2012. Kosovo needs to investigate and prosecute 
any  physical  attacks  against  journalists  and  complete  the  parliamentary  procedure  changing 
the  Criminal  Code  on  criminal  liability  of  the  media  and  protection  of  journalist  sources. 
Kosovo also needs to streamline and simplify the multitude of different bodies dealing with 
the  protection  of  human  and  fundamental  rights  to  ensure  effective  monitoring  and 
enforcement of the legal framework in this area. Kosovo needs to make progress in enforcing 
property  rights,  for  example  through  decreasing  the  backlog  of  cases  and  improving 
enforcement of judicial and administrative decisions. Legislation on personal data protection 
needs to be further harmonised with EU standards and administrative capacities strengthened 
in this area. 

The legislative framework for the protection of minorities is in place, including constitutional 
guarantees.  According  to  Kosovo's  constitution,  the  Council  of  Europe  Framework 
Convention for the Protection of National Minorities is directly applicable in Kosovo. Persons 

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belonging to minorities are well represented in the Assembly and in political functions at the 
government level. 

With strong international support, Kosovo has continued offering the possibility of return for 
displaced  persons.  Overall,  over  23,000  persons  belonging  to  minorities  have  returned  to 
Kosovo since 2000.  

Kosovo  has  also  started  implementing  decentralisation,  including  the  establishment  of  new 
municipalities  with  a  majority  of  minority  population.  In  the  short  term,  Kosovo  needs  to 
ensure  existence  of  a  body  enabling  direct  consultation  on  the  promotion  and  protection  of 
religious  and  cultural  heritage  with  religious  communities,  notably  the  Serbian  Orthodox 
Church.  

To  meet  its  obligations  under  a  Stabilisation  and  Association  Agreement,  Kosovo  needs  to 
promote  a  multi-ethnic  Kosovo,  by  creating  conditions  for  Kosovo  Serbs  to  feel  part  of 
Kosovo's  future  and  to  facilitate  return  for  persons  wishing  to  do  so.  The  Commission  also 
expects  that  Kosovo  will  continue  to  implement  decentralisation,  notably  in  the  new 
municipalities and thereby help the integration of Kosovo Serbs. Budget, staff and premises 
need to be allocated to the Office of the Language Commissioner.  

Kosovo also needs to implement legislation on protection of the cultural heritage and of the 
Serbian  Orthodox  Church,  notably  laws  on  the  historic  centre  of  Prizren  and  on  the  village 
Velika Hoča/Hoçë e Madhe. The Kosovo public broadcaster needs to ensure broadcasting in 
Serbian  language.  Attacks  motivated  by  ethnicity  or  religion  need  to  be  investigated  and 
perpetrators brought to justice and discrimination tackled. With regard to Roma, Ashkali and 
Egyptians  who  still  live  in  very  poor  conditions,  Kosovo  needs  to  demonstrate  progress  on 
implementation of the strategy and action plan, including through allocation of the necessary 
resources. 

On  war  crimes,  Kosovo  has  maintained  good  cooperation  with  the  International  Criminal 
Tribunal  for  the  former  Yugoslavia.  Kosovo  also  needs  to  support  the  work  of  the  Special 
Investigative Task Force of EULEX. 

3.2. 

Economic issues 

Kosovo has implemented the initial essential reforms towards establishing a fully functioning 
market economy. This is sufficient to establish contractual relations with countries from the 
Western  Balkans,  as  stated  in  the  Council  Conclusions  of  April  1997.  At  the  same  time, 
Kosovo's  economy  faces  many  important  challenges.  Unemployment  is  very  high  and  the 
private  sector  remains  weak.  Informalities  are  widespread  and  the  rule  of  law  needs  to  be 
enhanced  to  improve  the  business  environment  and  support  private  sector  development. 
Significant  further  efforts  are  needed  to  better  target  economic  policies,  address  fiscal 
consolidation,  job  creation  and  competitiveness  issues,  and  promote  private  investments  to 
achieve more sustainable and inclusive growth. 

3.3. 

Ability to assume the obligations resulting from a Stabilisation and Association 
Agreement 

The Commission analysis confirms that for majority of the sectors, Kosovo has put in place 
elements of the legislative framework and the basic administrative capacity. This is sufficient 
to  start  negotiating  a  Stabilisation  and  Association  Agreement.  At  the  same  time,  the  Staff 

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Working Document highlights that there are significant gaps and many issues that need to be 
addressed by Kosovo, to meet its obligations under such an agreement. 

Trade is a key sector in the context of a Stabilisation and Association Agreement. Kosovo has 
a liberal trade regime and is a very open economy, with few restrictions to trade. Kosovo is a 
member  of  CEFTA  and  has  a  tariff-free  regime  for  all  industrial  goods  and  agriculture 
products  with  all  members  of  CEFTA.  Kosovo  also  enjoys  customs-free  access  to  the  EU 
market  for  manufactured  products  and  almost  all  agricultural  products,  through  the  EU's 
autonomous  regime.  Kosovo  has  been  taking  steps  to  modernise  the  regulatory  framework 
related  to  the  free  movement  of  goods  with  a  view  to  approximation  with  the  acquis  by 
adopting  new  legislation  in  line  with  EU  standards  and  eliminating  non-EU  compatible 
regulations.  

The Ministry for Trade and Industry is being reorganised to improve capacity in this area in 
view of the trade-related parts of a Stabilisation and Association Agreement. The restructuring 
has not yet been fully completed. Therefore, in the short term Kosovo needs to implement the 
government decision on the restructuring of the Ministry and put in place a structure to lead 
and  coordinate  such  negotiations.  To  improve  the  understanding  of  the  impact  of  trade 
provisions of a Stabilisation and Association Agreement on Kosovo's economy, Kosovo needs 
to prepare an analytical study, including a clear statement of its negotiating priorities. 

There are further areas in which Kosovo needs to make progress to meet its obligations under 
a Stabilisation and Association Agreement. One of the key elements is implementation of the 
legal  framework  on  trade,  competition  and  internal  market  issues.  Illegal  animal  trade  and 
slaughtering continues and Kosovo needs to enhance control of these practices. The controls 
at  livestock  markets  also  need  to  be  strengthened.  Kosovo  would  benefit  from  improved 
business statistics. 

To  meet  its  obligations  under  a  Stabilisation  and  Association  Agreement,  Kosovo  needs  to 
enhance facilities dedicated to the phytosanitary and veterinary import controls as well as the 
capacity  to  transfer  samples.  The  transfer  of  the  food  safety  and  veterinary  inspectors  from 
municipalities to the Kosovo Food and Veterinary Agency needs to be finalised. Data entry 
into the animal identification, registration and movement database needs to be systematised. 
The laboratories involved in food controls need to be accredited. 

4. 

OVERALL CONCLUSIONS AND RECOMMENDATIONS 

Kosovo has made considerable progress on its path towards the EU since the conflict of the 
late  1990s.  It  has  put  in  place  a  stable  institutional  and  legal  framework  required  for 
democratic governance and protection of human rights, of all minorities living in Kosovo as 
well as of rights of returning displaced persons. 

The core institutional and legal framework to ensure the rule of law is in place. The legislation 
provides for strong guarantees of the independence of the judiciary. The basic institutions of 
the  judiciary  have  started  to  perform  their  role.  The  legal  framework  necessary  for  a  stable 
and professional public administration is also largely in place.  

Kosovo  has  implemented  the  initial  essential  reforms  towards  establishing  a  functioning 
market economy. Kosovo has a liberal trade regime and is overall, a very open economy, with 
few  restrictions  to  trade.  One  of  the  key  economic  challenges  Kosovo  faces  is  a  very  high 
level of unemployment.  

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Through  engagement  in  the  EU-facilitated  dialogue  with  Serbia,  Kosovo  has  demonstrated 
commitment to regional cooperation and stability. Kosovo has also established good relations 
with most of its neighbours. It participates in some of the regional fora and chaired CEFTA.  

Over  the  past  three  years,  Kosovo  has  increased  its  capacity  to  meet  obligations  stemming 
from a Stabilisation and Association Agreement. Kosovo is currently the only country of the 
Western Balkans that does not yet have contractual relations with the EU or benefit from the 
visa liberalisation. In trade, it relies on EU autonomous trade measures. 

From a legal point of view, the EU can conclude a Stabilisation and Association Agreement 
with Kosovo, as per Articles 217 and 218 TFEU. A Stabilisation and Association Agreement 
between  Kosovo  and  the  EU  can  be  concluded  in  a  way  that  it  respects  the  positions  of 
Member States on the status of Kosovo. On several occasions, the Council has confirmed the 
European  perspective  of  the  Western  Balkans.  Most  recently,  the  Council  confirmed  this 
perspective  for  Kosovo  in  December  2011.  Kosovo’s  European  ambitions  enjoy  strong 
support from the general public in Kosovo. 

The situation in the north of Kosovo remains an important challenge for Kosovo, the Western 
Balkans  region  at  large  as  well  as  the  EU.  All  actors  involved  need  to  take  positive  and 
proactive  steps  to  help  resolve  this  situation.  It  is  for  the  Kosovo  authorities  to  promote  a 
multi-ethnic Kosovo. They need to create conditions for Kosovo Serbs to feel they have future 
in  Kosovo.  The  current  situation  is  not  an  obstacle  to  negotiate  the  agreement,  but  further 
improvements  are  required  for  Kosovo  to  meet  the  obligations  under  a  Stabilisation  and 
Association Agreement. It is in the interest of people living in this part of Kosovo to benefit 
from the provisions of a possible future Stabilisation and Association Agreement. The EU is 
committed to help all parties concerned to find solutions to improve the lives of people living 
in the north of Kosovo. 

in 

the  Staff  Working  Document  and  summarised 

The  analysis  presented 
this 
Communication suggests that Kosovo is largely ready to open negotiations for a Stabilisation 
and Association Agreement. It is also essential that Kosovo continues implementing in good 
faith  all  agreements  reached  between  Belgrade  and  Pristina  to  date  and  that  it  engages 
constructively  on  the  full  range  of  issues  with  the  facilitation  of  the  EU.  On  this 
understanding,  the  Commission  will  propose  negotiating  directives  for  such  an  agreement, 
once Kosovo takes the following steps: 

in 

• 

• 

Rule  of  law:  demonstrate  a  clear  commitment  to  deliver  results  in  the  fight  against 
organised  crime  and  corruption,  including  launching  investigations  and  ensuring 
continuous  good  cooperation  with  EULEX.  Support  the  work  of  the  Special 
Investigative  Task  Force.  While  implementing  the  new  structure  of  courts,  ensure 
that the Special Prosecution responsible for cases of organised crime, war crimes and 
corruption maintains its competencies. Adopt the legislation on confiscation of assets 
and  revise  the  law  on  prevention  of  money  laundering  and  financing  of  terrorism. 
Adopt a new anti-corruption strategy. 

Public  administration:  adopt  the  necessary  secondary  legislation  of  laws  on  civil 
service and on salaries for the civil service. Allocate premises to the Ombudsperson 
Institution  and  ensure  its  budgetary  independence  through  obliging  the  government 
to  include  the  Ombudsperson's  draft  budget  proposal  into  the  global  draft  budget 
submitted to the parliament without changes. 

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• 

• 

Protection of minorities: ensure existence of a body enabling direct consultation on 
the  promotion  and  protection  of  religious  and  cultural  heritage  with  religious 
communities, notably the Serbian Orthodox Church. 

Trade:  implement  the  government  decision  on  the  restructuring  of  the  Ministry  for 
Trade  and  Industry,  put  in  place  a  mechanism  to  lead  and  coordinate  negotiations 
within Kosovo and prepare an impact analysis of trade aspects of a Stabilisation and 
Association Agreement. 

Kosovo  needs  to  continue  demonstrating  its  commitment  to  the  overall  EU  reform  agenda, 
including by increased alignment of legislation with the acquis. To meet its obligations under 
a Stabilisation and Association Agreement, Kosovo needs to make progress in the following 
areas in particular: 

• 

• 

• 

• 

• 

Rule  of  law:  provide  concrete  evidence  of  results  in  fighting  organised  crime  and 
corruption as a matter of priority, and strengthen legislation and its implementation 
particularly  on  prevention  and  fighting  against  trafficking  in  human  beings,  drugs, 
their precursors and weapons trafficking. Improve  the reliability of  statistics on the 
fight  against  serious  and  organised  crime  and  corruption.  Actively  support 
implementation  of  the  mandate  of  EULEX,  including  of  the  Special  Investigative 
Task Force. Ensure readmission from Member States.  

Judiciary: take measures to reduce the total backlog of cases. Implement the judicial 
reform,  including  by  ensuring  consistency  among  the  laws  on  courts,  Judicial  and 
Prosecutorial Councils and prosecution. Provide appropriate security and protection 
measures  for  judges  and  court  staff,  as  well  as  for  prosecutors,  witnesses  and 
plaintiffs,  and  provide  effective  safeguards  against  threats  or  intimidation.  Ensure 
trials  are  conducted  in  appropriate  premises  and  in  line  with  the  court  procedures. 
Continue  recruiting  judges  and  prosecutors  from  minorities,  as  set  out  in  the 
legislative framework. 

Public  administration:  make  progress  in  implementing  the  public  administration 
strategy  and  action  plan  and  related  legislation.  Ensure  a  sustainable  public 
administration  reform,  including  the  necessary  funding  and  staffing.  Increase  the 
overall share of persons belonging to minorities in the public administration. 

Electoral  reform  and  the  Assembly:  ensure  that  the  legal  framework  for  elections 
better  reflects  best  practice  in  the  EU  and  that  implementation  is  also  in  line  with 
international standards. Assembly to enhance its oversight of the executive, including 
of  the  security  sector,  through  improved  scrutiny  of  legislation  and  monitoring  of 
implementation of policies and laws. Assembly's financing and administration to be 
made  more  independent  from  the  government,  notably  through  adopting  legislation 
on the status of civil servants of the Assembly, ensuring that the draft budget of the 
Assembly is modified by the government in consultation with the Assembly before it 
is submitted to the Assembly for adoption.  

Human  and  fundamental  rights:  investigate  and  prosecute  any  physical  attacks 
against journalists and complete the parliamentary procedure to change the Criminal 
Code on criminal liability of media and protection of journalist sources. Streamline 
and  simplify  the  multitude  of  bodies  dealing  with  the  protection  of  these  rights  to 
ensure  effective  monitoring  and  enforcement  of  the  legal  framework  in  this  area. 

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• 

• 

• 

Make progress on the enforcement of property rights for example through decreasing 
the  backlog  of  cases  and  improving  enforcement  of  judicial  and  administrative 
decisions. Harmonise legislation on personal data protection with EU standards and 
focus on its implementation, notably by drafting secondary legislation and building 
up administrative capacities. 

Protection of minorities: promote multi-ethnic Kosovo; create conditions for Kosovo 
Serbs  to  feel  part  of  Kosovo's  future  and  conditions  for  the  return  of  persons  who 
wish  to  do  so.  Continue  implementing  decentralisation,  notably  in  the  new 
municipalities.  Allocate  budget,  staff  and  premises  to  the  Office  of  the  Language 
Commissioner.  Implement  legislation  related  to  the  protection  of  cultural  heritage 
and  the  Serbian  Orthodox  Church.  Ensure  broadcasting  in  Serbian  by  the  public 
broadcaster. Investigate and prosecute any physical attacks motivated by ethnicity or 
religion and bring perpetrators to justice. Progress on implementing the strategy and 
action plan for the Roma, Ashkali and Egyptians, including through the allocation of 
the necessary resources. 

Trade  and  internal  market  issues:  implement  the  legal  framework  on  trade, 
competition and internal market. Enhance the control of the continuing illegal animal 
trade  and  slaughtering  and  strengthen  the  controls  at  livestock  markets.  Improve 
business statistics. 

Phytosanitary  and  veterinary  issues:  enhance  the  facilities  for  phytosanitary  and 
veterinary  import  controls  as  well  as  the  capacity  to  transfer  samples.  Strengthen 
food  safety  and  phytosanitary  controls,  including  through  finalising  the  transfer  of 
the food safety and veterinary inspectors from municipalities to the Kosovo Food and 
Veterinary Agency. Systematise data entry into the animal identification, registration 
and movement database. Accredit the laboratories involved in food controls. 

The  Commission  invites  Kosovo  to  intensify  reforms  in  these  areas  and  focus  on 
implementation. The pace of progress depends on Kosovo. Public and political consensus in 
Kosovo on the EU reform agenda are key to its swift implementation. The Commission will 
continue  to  monitor  Kosovo's  progress  through  the  Stabilisation  and  Association  Process 
Dialogue, the Structured Dialogue on the Rule of Law, the visa dialogue process as well as 
through its regular progress reports.  

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