COMMUNICATION FROM THE COMMISSION TO THE EUROPEAN PARLIAMENT AND THE COUNCIL Monitoring Report on Croatia's accession preparations
Date: 2013-03-26
Institutions: European Commission
Subjects: Community acquis, Croatia, accession to the European Union, corruption, judicial cooperation in criminal matters in the EU, judicial reform, migration policy, restriction on competition

EUROPEAN 
COMMISSION 

Brussels, 26.3.2013  
COM(2013) 171 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 

The  Accession  Treaty  was  signed  on  9  December  2011,  following  the  Commission's 
favourable Opinion of October 2011 and the European Parliament's assent of December 2011. 
Croatia  will  become  a  Member  of  the  European  Union  on  1  July  2013,  subject  to  the 
Accession  Treaty  being  ratified  by  all  Member  States.  Currently  19  Member  States,  and 
Croatia, have ratified the Treaty and the Commission expects all remaining Member States to 
do so in good time before the date of Croatia's accession. As an acceding country, Croatia is 
enjoying active observer status during the interim period until accession. 

In the course of the negotiations, Croatia 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. 

Article  36  of  the  Act  of  Accession  requires  the  Commission  to  closely  monitor  all 
commitments undertaken by Croatia in the accession negotiations, focusing, in particular, on 
competition policy, judiciary and fundamental rights, and justice, freedom and security. As an 
integral  part  of  its  regular  monitoring,  the  Commission  has  been  issuing  six-monthly 
assessments,  on  the  implementation  of  Croatia's  commitments  in  these  areas.  The 
Commission adopted a Monitoring Report on Croatia's accession preparations in April 20121 
and  a  Comprehensive  Monitoring  Report2  in  October  2012  with  Croatia  adopting  an  action 
plan to follow up on their recommendations.  

In line with Article 36, this final Monitoring Report assesses the progress made by Croatia in 
its preparations for accession in the period between 1 September 2012 and 28 February 2013. 
This assessment is based on information gathered and analysed by the Commission, including 
input  provided  by  Croatia,  peer  assessment  missions  as  well  as  information  shared  by  the 
Member States, international and civil society organisations, in their regular contacts with the 
Commission.  The  assessment  is  also  based  on  the  findings  of  the  updated  half-yearly 
Monitoring  Tables,  a  working  tool  aimed  at  following  up  in  detail  all  commitments 
undertaken  by  Croatia  in  the  accession  negotiations.  The  assessment  on  the  ten  priority 
actions, identified in the Comprehensive Monitoring Report as requiring particular attention is 
given separately for each one, in the relevant thematic section. 

2. COMMITMENTS AND REQUIREMENTS ARISING FROM THE ACCESSION NEGOTIATIONS 

2.1 Competition policy 

Priority action 

Sign the privatisation contract for Brodosplit shipyard and take the necessary decisions to find 
a  viable  solution  for  the  shipyards  3.Maj  and  Brodotrogir  in  order  to  complete  the 
restructuring of the Croatian shipbuilding industry. 

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COM(2012) 186 final. 
COM (2012) 601 final and SWD(2012) 338 final. 

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Croatia  has  completed  this  priority  action.  Following  the  acceptance,  by  the  Commission 
decision of 20 February 2013, of the second amendment to the revised plan for the Brodosplit 
shipyard,  the  privatisation  contract  was  signed  on  28  February  2013.  The  amendment 
envisages  a  modest  increase  in  the  total  amount  of  restructuring  aid  as  well  as  additional 
compensatory measures. As regards 3. Maj, Croatia informed the Commission of its intention 
to submit a revised and consolidated restructuring plan which is now based on the purchase of 
the yard by the Uljanik shipyard. Croatia formally submitted a revised restructuring plan for 
Brodotrogir  on  12  February  2013  and  initialled  the  privatization  contract,  sending  it  to  the 
Commission in accordance with Annex VIII of the Act of Accession. On 20 March 2013, the 
Commission  gave  its  agreement  on  the  revised  restructuring  plan  and  on  the  privatisation 
contract.  Croatia  has  committed  to  sign  the  privatization  agreement  for  Brodotrogir  at  the 
latest two weeks after a positive decision by the Commission.  

Croatia also meets the other commitments and requirements in the field of antitrust, mergers 
and State aid. Its legislation is aligned with the acquis, its administrative capacity sufficient 
and  its  enforcement  record  satisfactory.  The  Croatian  Competition  Agency  (CCA)  is  fully 
operational and functionally independent. In October 2012 the CCA sent to the Commission 
its last six-monthly report with details on the number and type of decisions adopted, as well as 
assessment  and  opinions  in  the  fields  of  antitrust  and  mergers,  and  State  aid.  The  CCA 
adopted,  in  December  2012,  a  decision  in  the  field  of  antitrust  concerning  regional  bus 
carriers  where  a  significant  fine  was  imposed. Also,  the  same  month,  proceedings  against  a 
telecommunications provider were initiated.  

With  regard  to  Croatia's  reporting  obligations  arising  from  Annex  VIII  to  the  Act  of 
Accession,  Croatia  submitted  the  third  report  on  the  steel  industry  in  Croatia  in  December 
2012 and the six-monthly report on the restructuring of the Croatian shipbuilding industry in 
January  2013.  The  reports  meet  the  required  conditions  for  the  Commission  to  carry  out  its 
assessment.  

Concerning  the  steel  sector,  the  bankruptcy  proceedings  initiated  in  March  2011  against 
Željezara  Split  continued.  The  CMC  Sisak  (now  ABS  Sisak)  steel  mill  was  sold  to  a  new 
investor, who is consulting with the CCA on the amount to be reimbursed in accordance with 
the obligations of Annex IX to the Act of Accession. 

As  regards  existing  aid,  the  CCA  has  been  submitting  new  measures  and  schemes  to  the 
Commission services for evaluation, as required by Annex IV to the Act of Accession. 

2.2 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 (2011 – 2015) and action plan has continued. 
The legislative framework has been further improved, in particular with a view to increasing 
the efficiency of the judicial system. The process of rationalisation of the judicial network has 
continued.  

A new strategy for the development of the judiciary for 2013-2018 was adopted by Parliament 
in  December  2012.  The  strategy  was  prepared  in  close  consultation  with  the  Council  for 
monitoring  the  implementation  of  the  Judicial Reform  Strategy.  The  main  focus  of  the  new 
strategy is on the efficiency of the judiciary. 

The long-term employment plans for judges and prosecutors for 2013-2025 were adopted by 
the Ministry of Justice in October 2012. Human resources planning and management remain 
to be improved further, in particular in the context of rationalisation of the court network. 

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The budget for the judiciary slightly decreased and amounts to around € 313 million for 2013 
(2012:  €  337  million),  which  is  considered  suff icient.  The  budget  for  investment  in  courts' 
infrastructure has been increased by 50% and amounts to around € 8 million. 

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

The  reformed  State  Judicial  Council  (SJC)  and  State  Prosecutorial  Council  (SPC)  have 
continued to operate independently. Both bodies have continued to appoint judicial officials 
based on transparent, uniform and objective criteria. In the period September 2012 – February 
2013, 40 judges were appointed. A number of recruitments foreseen under the 2011 and 2012 
recruitment plans still need to be completed.  

Starting from 1 January 2013, a new system of appointments of judges to first instance courts 
applies in full, following the expiry of the transitional period. It requires all candidates to have 
completed the State School for Judicial Officials. The two years' training for the first intake of 
candidates for the State School for Judicial Officials was completed in November 2012. After 
adoption  of  the  Ordinance  on  the  final  exam  and  final  evaluation  in  the  State  School  for 
Judicial Officials in February 2013 the final exams are scheduled to take place in May 2013. 
The  training  for  the  first  year  of  the  second  intake  of  candidates  for  the  State  School  for 
Judicial Officials started in September 2012 (the SPC selected 35 and the SJC 20 candidates). 

The  amendments  to  the  State  Judicial  Council  Act,  which  were  adopted  in  February  2013, 
exempt the President and those members of the State Judiciary Council who are judges from 
their normal duties by 75 % and by 50% respectively. This is a positive step with a view to 
strengthening  the  capacity  of  the  SJC.  Additional  administrative  resources  need  to  be 
provided to enhance its efficiency. It is important that the SJC increases its transparency and 
demonstrates  accountability  in  carrying  out  its  tasks.  Further  reforms  should  include  a 
mechanism  for  judicial  review  of  decisions,  public  sessions  and  an  extended  obligation  to 
provide reasoned decisions. 

The  SJC  and  SPC  have  continued  implementing  the  new  system  of  asset  declarations  in 
cooperation with the tax administration. Disciplinary proceedings have been initiated against 
judges who did not submit their declaration of assets within the deadline, and in the majority 
of cases sanctions (reprimands) have been imposed. As to the verification of data, the checks 
carried out on the basis of the information received from the Tax Administration have not yet 
been completed. 

Disciplinary measures are being taken in cases of wrongdoing by judicial officials. Both SJC 
and  SPC  became  more  proactive  and  continued  developing  a  track  record  of  decisions 
rendered  and  sanctions  imposed.  The  new  Courts  Act  adopted  in  February  2013  limits  the 
immunity of judges and thus brings secondary legislation in line with the Constitution.  

The  good  work  done  so  far  by  the  Judicial  Academy  should  continue  and  its  activities  and 
management need to be supported by all main stakeholders in the judiciary. Professional life-
long  training  of  judges  and  prosecutors  is  key  to  improving  the  quality  of  the  judiciary. 
Professional  training  programmes  should  continue,  including  increased  training  on  EU  law. 
Croatia participated in the Criminal Justice programme and in training activities organised by 
the European Judicial Training Network. 

3) To continue to improve the efficiency of the judiciary 

Priority action 

Implement the immediate and advance on the short-term measures elaborated in September 

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2012 for increasing the efficiency of the judiciary and reducing the court backlog.  

Croatia has completed this priority action. Croatia has implemented the immediate and short-
term  measures  elaborated  by  the  Ministry  of  Justice  in  September  2012  with  a  view  to 
increasing the efficiency of the judiciary and reducing the court backlog.  

During 2012, the courts overall managed to solve more cases than the influx. The backlog of 
civil, commercial and enforcement cases continues to be above the EU average. In its efforts 
to  improve  the  efficiency  of  the  judicial  system  in  a  sustainable  manner,  the  Ministry  of 
Justice has successfully created an advanced tool for statistical analysis of the performance of 
the judicial system, which is expected to enable it to allocate human and financial resources to 
resolve  the  incoming  workload  and  the  backlog.  The  new  statistical  system  can  become 
operational  nationwide  as  soon  as  all  courts  are  equipped  with  the  Integrated  Case 
Management System (ICMS). 

Good progress has been made in the introduction of the ICMS in the remaining 33 municipal 
courts, planned to be completed by September 2013. A single comprehensive system for the 
statistical monitoring of case handling remains essential. 

In  2012,  110  civil  servants  were  permanently  employed  in  order  to  fill  vacancies  and  250 
additional  civil  servants  were  temporarily  employed.  A  significant  part  of  appointments  of 
judges planned for 2012 were postponed to 2013. In 2012, 27,013 cases from overburdened 
courts  were  delegated  by  a  decision  of  the  Supreme  Court  (in  2011:  6,123).  In  2012,  the 
possibility of temporary or permanent voluntary mobility of judges to support overburdened 
courts  was  increasingly  used.  In  2012,  overall  48  judges  were  transferred  permanently  (in 
2011:  13)  and  22  temporarily  (in  2011:6).  In  2012,  a  total  of  23  judicial  inspections  were 
carried out. Alternative dispute resolution has been increasingly used in cases where State and 
State-owned enterprises were involved and should be further promoted. 

A new Courts Act was adopted by Parliament in February 2013. It strengthens the supervisory 
authority  of  court  presidents,  in  particular  as  regards  efficient  court  performance  and 
introduces a mechanism for protection of the right to trial within reasonable time. In addition 
to  the  reforms  introduced  by  the  new  Courts  Act,  Court  presidents  should  develop  annual 
management plans, which need to be monitored. The exchange of best practices developed in 
individual courts should be encouraged. 

Amendments  to  the  State  Judicial  Council  Act,  adopted  in  February  2013,  provide  for 
increased  transparency  of  the  transfer  of  judges  and  will  facilitate  horizontal  mobility.  In 
February  2013  Amendments  to  the  Civil  Procedure  Act  were  adopted,  which  limit  the 
possibility  of  multiple  referral  of  cases  from  higher  to  lower  instances,  introduce  electronic 
summoning in Commercial Courts, as well as stricter rules for presenting new evidence. The 
possibility for the appellate court to refer a case back to the lower instance could be further 
limited to extraordinary circumstances.  

The  new  Framework  Criteria  for  the  Performance  of  Judges  adopted  in  December  2012 
increase incentives for solving very old cases but would need to better reflect the types and 
complexity  of  cases,  the  size  of  the  court,  the  level  of  specialisation,  and  the  level  of 
jurisdiction concerned. Draft Amendments to the Misdemeanour Act and to the Land Registry 
Act  are  planned  to  be  adopted  at  the  end  of March/beginning  of  April.  All  these  legislative 
measures  are  expected  to  contribute  to  increasing  the  efficiency  of  the  judicial  system  and 
reducing the current backlog, if properly implemented.  

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Priority action 

Adopt the new enforcement legislation, in order to ensure the execution of court decisions and 
reduce the backlog of enforcement cases.  

Croatia has completed this priority action. The new Enforcement Act and amendments to the 
Act  on  the  Implementation  of  the  enforcement  of  monetary  funds  entered  into  force  on  15 
October  2012.  The  new  system  concentrates  enforcement  in  municipal  courts  and  thus 
unburdens  commercial  courts.  Municipal  courts  are  responsible  only  for  non-monetary 
enforcement,  while  monetary  titles  are  enforced  directly  and  exclusively  by  the  Financial 
Agency (FINA). A decrease in the number of enforcement cases to be handled by the courts 
and an improvement of the clearance rate is already noticeable. 

The  Ministry  of  Justice  upgraded  the  ICMS  in  order  to  register  and  calculate  the  recovery 
rate,  as  a  key  indicator  for  the  effectiveness  of  the  enforcement  system.  It  has  also  started 
working  on  further  reform  measures  to  increase  the  transparency  and  efficiency  of 
enforcement on immovable property.  

4) To continue to improve the handling of domestic war crimes cases. 

Regarding  the  processing  of  domestic  war  crimes,  one  new  investigation  was  launched,  six 
indictments were raised, and eight non-final judgements were rendered. A new list of national 
and regional priority cases in the framework of the strategy for addressing impunity has been 
established. Further efforts are needed to impartially tackle impunity with a particular focus 
on initiating and speeding up investigations.  

Following  the  verdict  of  the  International  Criminal  Tribunal  for  the  former  Yugoslavia 
(ICTY)  on  the  Gotovina/Markac  case  in  November  2012,  the  State  Attorney's  Office 
requested  from  ICTY  the  entire  documentation  from  the  trial  against  the  three  Croatian 
generals  (Gotovina,  Markac,  and  Cermak),  in  order  to  assist  in  the  efforts  of  detecting  and 
prosecuting perpetrators of crimes committed during and after the military operation "Storm". 
Croatia has already received, from the ICTY, the Court's files.  

The Constitutional Court ruling on 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 is still pending. Nevertheless, bilateral cooperation 
with  Serbia  has  continued.  Croatia  has  also  continued  to  participate  in  regional  cooperation 
concerning  the  handling  of  war  crimes  cases  and  has  submitted  data  and  documents  to  the 
War Crimes' Prosecutor of Serbia and the Supreme State Prosecutor of Montenegro.  

The administrative capacity of the specialised courts has been increased. It is expected that the 
entry into force of the new Criminal Code on 1 January 2013 will significantly unburden the 
specialised  courts  and  allow  them  to  focus  more  on  serious  forms  of  crime,  including  war 
crimes.  Still,  a  more  pro-active  approach  in  tackling  impunity  would  require  enhanced 
administrative capacity, in order to cope with an increased number of cases.  

In terms of other measures for improving the handling of war crimes, the Judicial Academy 
included training on war crimes in its 2013 programme. 

The  independent  sector  for  victims  and  witness  support  at  the  Ministry  of  Justice  and  the 
departments  for  victims  and  witness  support  at  County  courts  continued  to  facilitate  the 
attendance  of  witnesses  in  war  crimes  trials.  Continued  attention  needs  to  be  given  to  the 
protection of witnesses.  

On 23 January 2013 the Municipal Court in Knin rendered a judgement that the Croatian State 
must pay compensation to the children of Serb victims killed in the village of Varivode after 

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the  Operation  "Storm",  regardless  of  the  fact  that  the  perpetrators  are  unknown.  It  thus 
addressed  for  the  first  time  a  long-standing  grievance  relevant  for  other,  similar,  cases.  The 
issue  of  compensation  for  the  civilian  victims  of  war  crimes  should  now  be  systematically 
tackled. 

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. 

The legal and institutional framework for the suppression of corruption and organised crime is 
adequate. With the entry into force of the new Criminal Code on 1 January 2013, penalties in 
a number of areas have been increased, including for corruption offenses. A track record of 
implementation  continues  to  be  developed.  Law  enforcement  bodies  remain  proactive, 
including in higher-level corruption cases (e.g. former mayors, former deputy ministers) and 
corruption  in  law-enforcement  institutions  (several  police  officers).  Developments  also 
include  the  first-instance  judgement  in  a  case  against  a  former  prime  minister  in  November 
2012.  

Overall  the  level  of  sentences  in  organised  crime  cases  remains  low.  Also  in  the  area  of 
corruption court sentences are low; very often suspended sentences are pronounced. Effective 
and dissuasive sentences in cases of corruption and serious and organised crime are needed to 
continue developing a sustained track record and avoid creating a climate of impunity. 

The total amount of assets seized and confiscated remains limited. The legal framework for 
the  seizure  and  confiscation  of  assets  needs  to  be  implemented  more  consistently  and 
forcefully.  So  far,  the  tool  of  confiscation  of  criminal  assets  is  not  used  for  the  purpose  of 
disrupting the financial basis of a criminal organisation. 

The  fight  against  local-level  corruption  needs  to  be  further  enhanced,  particularly  in  the 
vulnerable sector of public procurement. Regarding the system for checking on dismissals of 
criminal cases by the prosecutor, the current system does not provide for independent checks 
on decisions by State prosecutors to dismiss reports of crime.  

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

Croatia  continued  strengthening  its  legislative  framework  of  prevention  of  corruption  and 
conflict of interest, which now needs to be effectively implemented. Croatia needs to increase 
its  efforts  to  establish  a  track  record  of  substantial  results  in  strengthening  prevention 
measures.  Moreover,  following  the  Constitutional  Court  ruling  of  November  2012,  which 
annulled several provisions of the Conflict of Interest Act regarding core competences of the 
Conflict of  Interest Commission  (including its  verification and sanctioning powers), Croatia 
needs  to  ensure  that  immediate  measures  are  taken  to  put  in  place  a  strong  and  effective 
mechanism  for  preventing,  detecting  and  sanctioning  conflict  of  interest  cases,  based  on 
thorough checks and deterrent sanctions. A working group, including the Ministry of Public 
Administration and civil society (GONG, Transparency International) has been established to 
consider the necessary amendments to the law. 

Priority action 

Establish the Conflict of Interest Commission so that it starts its regular working activities.  

Croatia  has  completed  this  priority  action.  The  members  of  the  Conflict  of  Interest 
Commission  were  appointed  by  Parliament  on  25  January  2013  and  took  office  on  11 
February  2013.  The  Conflict  of  Interest  Commission  has  started  processing  requests 

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submitted  by  officials  for  an  opinion  on  whether  in  their  case  conflict  of  interest  exists  and 
already  issued  several  opinions.  As  regards  cases  based  on  reports  of  alleged  conflict  of 
interest,  the  Commission  initiated  procedures  against  26  officials.  The  Conflict  of  Interest 
Commission  now  needs  to  make  sure  that  an  effective  mechanism  for  detection,  prevention 
and  sanctioning  of  conflict  of  interest  cases  is  in  place,  and  to  establish  a  track  record  of 
checks and sanctions without delay.  

Priority action 

Adopt  the  new  law  on  access  to  information,  in  order  to  strengthen  the  legal  and 
administrative framework in the area of access to information.  

Croatia  has  completed  this  priority  action.  In  February  2013  the  new  Law  on  Access  to 
Information was adopted. The law introduces the so-called proportionality and public interest 
test in all cases of denial of access to information and implements the EU acquis on the re-use 
of  information.  It  establishes  also  a  new  institutional  arrangement  for  monitoring  the 
implementation of the law: whereas, until now, the Data Protection Agency was dealing with 
both  data  protection  and  access  to  information,  the  new  law  foresees  the  establishment  of  a 
Commissioner  dealing  with  access  to  information,  appointed  by  Parliament.  It  is  important 
that  in  the  exercise  of  their  respective  mandates  the  Data  Protection  Agency  and  the  new 
Commissioner on Access to Information ensure coherence of decisions taken.  

The  Action  Plan  on  anti-corruption  is  being  revised  with  a  view  to  introducing  adequate 
measures  aimed  at  ensuring  the  effective  monitoring  of  its  implementation  and  cover  also 
aspects of suppression of corruption. The role and capacity of the Ministry of Justice as the 
institution in charge of defining, co-ordinating, and implementing the anti-corruption agenda 
should be strengthened further.  

With regard to other actions in this area, amendments to the Act on the Financing of Political 
Activities  and  Electoral  Campaign  adopted  in  February  2013  are  designed  to  facilitate 
effective implementation of the law by reducing regulatory complexity, streamlining financial 
information, and reinforcing controls. The upcoming local elections will constitute a test for 
the implementation of the improved rules.  

The State Election Commission and the State Audit Office continued applying the legislation 
on  the  funding  of  political  parties  and  election  campaigns  and  notified  the  State  Attorney's 
Office  on  the  political  parties  and  independent  members  of  the  local  and  regional  self-
government units, who had not submitted financial reports for 2011 or had not published them 
on their web pages within the statutory term.  

Concerning  public  procurement,  transparency  has  increased  in  accordance  with  the  new 
legislation  in  force  since  January  2012.  Information  on  signed  and  executed  contracts  is 
published by all public bodies. Furthermore, Croatia needs to take all necessary measures to 
prevent the occurrence of irregularities in the procurement of projects to be co-financed under 
the Cohesion Policy by the setup of a solid management and control system. 

Croatia  needs  to  ensure  that  a  strong  mechanism  is  in  place  to  prevent  corruption  in  state-
owned  companies,  including  as  regards  membership  of  the  supervisory  and  management 
boards.  Also,  the  legal  basis  for  a  professional  civil  service  through  the  establishment  of  a 
new salary system so as to ensure merit-based promotion, reward mechanisms and retention 
of skilled staff, needs to be completed.  

The necessary mechanisms for the effective protection of whistle-blowers need to be put into 
effect. 

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

Implementation of the Constitutional Act on the Right of National Minorities (CARNM) has 
continued. Regarding the employment of minorities in the state administration and judiciary 
in  the  context  of  a  low  level  of  overall  recruitment,  in  November  2012,  about  3.4%  of  the 
members  of  the  state  administration  belonged  to  national  minorities.  Following  a  more 
proactive  approach  by  the  government,  the  target  of  5%  has  been  reached  for  the  new 
recruitment of 400 border police. 

In  November  2012,  the  government  adopted  the  National  Strategy  for  Roma  Inclusion  for 
2013-2020. The corresponding draft Action Plan was submitted to public consultation and is 
planned  to  be  adopted  at  the  end  of  March  2013.  Further  efforts  are  needed  to  ensure  that 
Roma children complete primary and secondary education. The government continued to take 
measures in order to raise awareness for persons belonging to national minorities and ensure 
the  exercise  of  their  rights.  It  is  welcome  that  the  government  continues  to  ensure  the 
implementation of the constitutional provisions on the use of the Cyrillic script in the city of 
Vukovar, where Croatians of Serb ethnicity account for 38.5% of the population.  

Croatia continued to take measures to protect those who may still be subjected to threats or 
acts  of  discrimination,  hostility  or  violence.  The  legal  framework  has  been  further 
strengthened  in  this  respect:  Amendments  to  the  Criminal  Code  were  adopted  in  December 
2012  in  order  to  align  the  Criminal  Code  with  the  acquis  on  combating  certain  forms  and 
expressions  of  racism  and  xenophobia  by  means  of  criminal  law.  A  new  Act  on 
Misdemeanours  against  Public  Order  and  Peace  will  introduce  the  misdemeanour  of 
violations against public peace and order based on racial, ethnic, religious and other grounds. 
The  law  is  in  parliamentary  procedure  and  planned  to  be  adopted  by  the  end  of  the  second 
quarter of 2013. Specialised training of police officers on the suppression of hate crimes has 
been stepped up.  

8) To continue to address outstanding refugee return issues. 

Croatia  has  continued  to  engage  with  the  other  countries  of  the  region  in  the  Sarajevo 
Declaration Process. The decision on validating pension rights continues to be implemented. 

The  implementation  of  the  Housing  Care  programmes  for  returning  refugees  continues  at  a 
slow  pace.  Under  the  March  2011  plan  for  dealing  with  the  approximately  2,350  remaining 
applications  by  February  2013  366  (August  2012:  259)  were  settled,  out  of  which  213 
(August  2012:  139)  families  took  over  the  keys.  By  February  2013  1,497  (August  2012: 
1,305) positive approvals for housing care have been given.  

There  has  been  limited  implementation  of  the  new  purchase  options  under  favourable 
conditions  for  housing  care  beneficiaries.  Twelve  out  of  the  remaining  15  unsolicited 
investment cases are expected to be solved following a government decision to be adopted at 
the end of March 2013; the other three cases are planned to be solved by a special decision of 
the government in the third quarter of 2013.  

9) To continue to improve the protection of human rights. 

Human  rights  continue  to  be  generally  well-respected.  The  Ombudsman  and  specialised 
ombudspersons play an important role in human rights protection. Continued attention needs 
to  be  paid  to  ensure  that  the  Ombudsman's  recommendations  are  followed  up.  A  new 
Ombudsman  was  elected  on  15  February  2013.  There  continues  to  be  a  need  for  further 

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strengthening the Ombudsman offices. This includes providing adequate financing and office 
premises.  

Croatia  has  further  developed  its  track  record  of  implementation  of  the  Anti-discrimination 
Act and legislation on hate crimes. Specialised training of police officers on the suppression 
of hate crimes has been stepped up. The investigation and prosecution of cases of intimidation 
and violence against journalists continued. The Ministry of Justice prepared draft amendments 
to the Free Legal Aid Act and consulted on them with relevant stakeholders. The amendments 
aim at facilitating access to legal aid and fostering the role of NGOs as legal aid providers and 
are planned to be adopted by the end of the second quarter of 2013. 

Croatia  has  completed  legal  alignment  in  the  fields  of  anti-discrimination  and  equal 
opportunities. 

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

Croatia's cooperation with the ICTY has continued.  

2.3 Justice, freedom and security 

Priority action 

Finalise and adopt the migration strategy, clearly defining measures for the integration of the 
most vulnerable groups of migrants. 

Croatia  has  completed  this  priority  action.  The  migration  strategy  ("Migration  policy  of  the 
Republic of Croatia for 2013-2015"), clearly defining measures for the integration of the most 
vulnerable groups of migrants, was adopted by the Parliament in February 2013.  

In  the  field  of  migration,  alignment  with  the  acquis  is  almost  complete.  In  2012,  6,541 
irregular  migrants  were  identified  (3,461  in  2011).  The  reception  centres  for  irregular 
immigrants and asylum seekers are reaching their maximum capacity. In order to increase the 
capacity  and  mitigate  the  situation,  the  Ministry  of  Interior  has  taken  over  a  former  hotel 
where  400  asylum  seekers  can  be  accommodated  and  up  to  600  people  after  minor 
refurnishing.  Additional  temporary  solutions  have  been  found  in  the  northern  and  southern 
border  areas,  while  waiting  for  the  construction  of  two  new  permanent  aliens'  centres  to  be 
financed  under  the  Schengen  Facility  Fund.  Croatia  has  yet  to  start  the  construction  of  a 
separate facility  for  minors  and other vulnerable groups of migrants within the perimeter of 
the existing centre for irregular migrants; for this, IPA funds have been already secured. The 
new  readmission  agreement  with  Germany  entered  into  force  in  November  2012. 
Negotiations on a readmission agreement with Kosovo3 are ongoing.  

Preparations  for  the  implementation  of  the  asylum  acquis  are  almost  complete.  The 
administrative courts continued to operate as a second-instance body for asylum applications; 
a  selection  procedure  is  currently  on-going  to  recruit  additional  judges.  Training  for  border 
police continued and asylum-related training for 66 border police officers started in January 
2013.  The  Asylum  unit  was  strengthened  by  additional  staff.  From  1  September  2012  to  9 
January  2013,  protection  was  granted  to  16  applicants.  Furthermore,  in  that  period,  63 
applications were rejected and 300 proceedings suspended. Additional accommodation of up 
to 600 places will be ensured in the hotel taken over by the Ministry of Interior (see above), 
taking into account the increased number of asylum seekers reaching Croatia (1,193 in 2012 
compared to 807 in 2011). There are currently two EURODAC stations for the entire country, 

3 

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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with  additional  30  foreseen.  In  the  meantime,  Croatia  needs  to  ensure  the  registration  of 
asylum seekers when entering the country by using the existing scanners at the main border 
crossing points. 

Legislative alignment regarding visa policy is almost complete. On visa requirements, Croatia 
has further aligned its legislation regarding the list of countries whose nationals require a visa 
to enter Croatian territory with Regulation 539/2001. As of 1 November 2012, the Decision 
on temporary suspension of visa regime for nationals of Azerbaijan, Kazakhstan, the Russian 
Federation and Ukraine ceased to apply. Negotiations on a new visa regime with Turkey are 
on-going;  it  will  be  introduced  on  1  April  2013.  As  regards  the  Russian  Federation,  the 
agreement on mutual travelling of nationals will enter into force by the end of March 2013. 
Training for consular officers continued, aiming at posting them in the new consulates which 
will become operational by April 2013. 

As  regards  external  borders  and  Schengen,  legislative  alignment  is  almost  complete.  The 
2013  revision  of  the  Integrated  Border  Management  Action  Plan  (IBM  AP),  in  view  of 
aligning  the  national  concept  with  the  EU  one,  is  in  preparation.  The  first  phase  of  the 
establishment  of  the  Zadar  Maritime  Surveillance  Centre,  including  the  purchasing  of 
equipment, has been completed and its staff reinforced. The second phase is underway and is 
to be completed by April 2013 to ensure the link between systems of different ministries. The 
implementation  of  the  working  arrangements  with  Frontex,  including  participation  in  joint 
operations, continued. Croatia's contact point with Frontex was established in Bajakovo BCP.  

Priority action 

Complete the construction of border crossing points at the Neum corridor. 

This priority action is expected to be completed imminently. The works for the construction 
of`  the  border  crossing  points  (BCPs)  of  the  Neum  corridor  (Klek  and  Zaton  Doli)  have 
accelerated substantially. They are nearing completion and need to be fully operational by the 
date of accession. Nova Sela BCP, close to Metkovic, is also about to be completed; once in 
operation,  this  BCP  will  also  become  the  common  contact  point  with  Bosnia  and 
Herzegovina. 

The  new  acquis-compatible  Local  Border  Traffic  Agreement  with  Bosnia  and  Herzegovina 
has been prepared and is expected to be signed, together with the agreements on BCPs, by the 
end of May. As regards cooperation with the other countries of the region, Croatia prepared 
and submitted to Serbia and to Montenegro two protocols on joint patrols and on exchange of 
information on border control. Talks with the two countries to bring bilateral agreements on 
local  border  traffic  in  line  with  the  acquis  continued.  The  agreements  need  to  be  in 
compliance with the acquis by accession. Joint patrols are on-going.  

Priority action 

Achieve the established recruitment target for border police for 2012. 

Croatia has completed this priority action. The recruitment of 467 border police officers has 
been achieved, thus reaching Croatia's target for 2012. In January 2013, the total number of 
border  police  officers  was  6,338,  out  of  which  4,971  police  officers  were  allocated  to  the 
future  external  border.  Recruitment  will  continue  with  100  new  police  offers  during  2013, 
including  specialised  maritime  personnel  for  the  blue  border.  Specialised  training  for  the 
police has continued and the updated version of Common Core Curriculum (CCC) was sent to 
the  Police  academy  in  order  to  draft  the  corresponding  specialized  border  police  course 
programme. Training for maritime police needs continued attention. 

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The National Border Management Information System (NBMIS) at the border crossing points 
located at the future external border is, as of January 2013, operational at 76 BCPs. Croatia 
shall  ensure  that  these  are  increased  to  93  BCPs  in  June  2013,  as  planned.  Additional 
technical  equipment  was  procured.  Activities  have  started  to  set  up  the  EUROSUR  centre; 
premises have been found. Concerning inter-agency cooperation on IBM issues, coordination 
meetings continued.  

Concerning the fight against corruption in border management, a total of 2,681 unannounced 
inspections were conducted in the period from 1 September 2012 to 31 January 2013.  

Croatia has continued the process of alignment with the relevant Schengen acquis, as well as 
its implementation and enforcement. The first draft of the revised Schengen Action plan has 
been  prepared.  The  Ministry  of  Interior  is  in  the  process  of  preparing  an  Indicative 
Programme regarding the Schengen Facility Fund. It is important that Croatia is duly prepared 
for  the  implementation  of  the  Schengen  Facility  and  Solidarity  and  the  Management  of 
Migration Flows (SOLID) Funds 

Croatia's preparations for the alignment of its legislation in the field of judicial cooperation 
in  civil  and  criminal  matters  are  almost  completed.  Following  the  agreements  with 
Montenegro  and  Kosovo  on  mutual  legal  assistance  in  criminal  matters,  Croatia  signed  a 
similar  agreement  with  Bosnia  and  Herzegovina  in  November  2012.  A  new  Act  on 
International Private Law is expected to be adopted in the first half of 2013. The agreement on 
mutual  execution  of  criminal  judgments  with  Montenegro  and  the  agreement  on  extradition 
with  the  former  Yugoslav  Republic  of  Macedonia  entered  into  force.  As  regards  the 
institutional  setting,  the  number  of  contact  points  for  the  European  Judicial  Network 
increased,  to  cope  with  the  obligations  stemming  from  the  EU  accession;  good  cooperation 
has continued with EUROJUST. A service on mutual assistance on extradition and criminal 
matters  was  established  within  the  Ministry  of  Justice.  The  Act  on  Judicial  Cooperation  in 
Criminal Matters with EU Member States remains to be adopted. 

Priority action 

Complete the adoption of related by-laws, to ensure the implementation of the police law. 

Croatia  has  completed  this  priority  action.  All  36  by-laws  were  adopted  in  2012  and  are 
applicable  as  of  1  January  2013.  The  legal  framework  for  the  full  implementation  of  the 
police law is, therefore, in place.  

Croatia's preparations in the alignment with the acquis in the area of police cooperation and 
the fight against organised crime are almost complete.  

The Supplementary Information Request and National Entry (SIRENE) Bureau is now legally 
established; its Head was appointed in December 2012 and five police officers are currently 
working there. The recruitment process for the rest of the staff is on-going. Five persons are 
working on the Schengen Information System in the IT department of the Ministry of Interior. 
Close cooperation with EUROPOL continued.  

The  track  record  for  fighting  organised  crime  continued  to  develop;  new  cases  were 
reported, including on drug trafficking,  as  well  as for the  misuse  of EU funds. The level of 
sentencing often remains low and thus not dissuasive enough compared to the gravity of the 
crime.  This  is  particularly  so  for  cases  of  trafficking  in  human  beings.  Criminal  assets 
continued  to  be  seized,  however,  frequently  in  small  amounts  which  as  such  do  not  disrupt 
criminal financial flows. Hence, legal provisions on seizure and confiscation of assets need to 
be implemented more consistently and forcefully. Inter-agency cooperation has significantly 
improved  and  good  results  were  achieved  by  the  Financial  Intelligence  Unit  (FIU);  in  the 

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period July-December 2012 the FIU received a total of 288 suspicious transactions (STRs) out 
of  which  three  related  to  terrorism  financing  and  285  to  money  laundering.  Out  of  the  288 
STRs,  164  cases  have  been  opened.  Under  the  Criminal  Procedure  Act,  victims  of  serious 
crimes  are  entitled  to  compensation  from  the state  budget.  Concerning  trafficking  in  human 
beings,  the  new  Criminal  Code,  which  entered  into  force  on  1  January  2013,  contains  an 
amended  definition  of  trafficking  in  human  beings  which  now  is  aligned  with  international 
standards  as  it  makes  a  clear  distinction  between  slavery  and  trafficking.  The  head  of  the 
National  Committee  for  suppression  of  trafficking  in  human  beings  was  appointed  in 
November 2012 and the Committee held its first session in December 2012. It urgently needs 
to  take  pro-active  and  concrete  measures  to  address  trafficking  in  human  beings  and  raise 
awareness amongst the national authorities on this form of crime, including by launching an 
independent evaluation of the policy and to intensify outreach actions in places where victims 
or  potential  victims  of  trafficking  are  likely  to  be  abused.  Training  for  judicial  and  law-
enforcement personnel on trafficking in human beings needs to continue, especially to detect 
victims of trafficking at the main BCPs and to better distinguish trafficking and smuggling of 
migrants.  The  low  number  of  identified  victims  of  human  trafficking  is  a  point  of  concern. 
Croatia needs to step up efforts to proactively identify trafficked victims, in particular among 
vulnerable  sectors  of  the  population.  It  should  investigate,  prosecute  and  convict  trafficking 
offenders  and  ensure  sentences  are  commensurate  with  the  seriousness  of  the  offence 
committed.  To  this  end,  administrative  and  law  enforcement  capacities  need  to  be 
strengthened. 

Training  has  continued  on  anti-money  laundering  and  cooperation  amongst  authorities  on 
this specific form of crime was fostered. The number of cases recorded in 2012 remains low.  

2.4 Other acquis chapters and economic issues 

Croatia is meeting the commitments and requirements arising from the accession negotiations 
and will be in a position to implement the acquis as of accession.  

In its Comprehensive Monitoring Report  of October 2012, the Commission had identified a 
limited  number  of  Chapters  where  increased  efforts  were  required  by  Croatia.  These  were 
Chapters  11  –  Agriculture  and  rural  development,  12  –  Food  safety,  veterinary  and 
phytosanitary  policy,  13  –  Fisheries,  22  –  Regional  policy  and  coordination  of  structural 
instruments and 27 – Environment. 

In the field of agriculture and rural development, Croatia has finalised the legal framework 
for  direct  payments  for  2013.  The  Paying  Agency  received  the  provisional  accreditation  for 
direct payments and for horizontal matters in December 2012. The Croatian authorities now 
need  to  follow  the  recommendations  delivered  to  the  Paying  Agency.  By  the  end  of  2013, 
Croatia  needs  to  accredit  the  paying  agency  for  the  management  of  the  rural  development 
funds and advance in the preparation of the rural development programme 2014- 2020.  

In  the  field  of  food  safety,  veterinary  and  phytosanitary  policy,  Croatia  has  accelerated  the 
construction  and  equipment  of  the  seven  Border  Inspection  Posts  (BIPs).  Croatia  needs  to 
ensure that the BIPs are finalised in time so that they can be accredited by the Commission 
and operate in full compliance with the acquis by the date of Croatia’s accession. 

In the field of fisheries, legislative alignment and implementation of the acquis in the areas of 
fleet and resources management is nearing completion, as well as structural measures and the 
preparation  of  the  national  management  plans.  Croatia  now  needs  to  step  up  its  efforts  to 
finalise  its  work  in  the  areas  of  inspection  and  control,  finalising  the  phasing-out  of  the 

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category of subsistence fisheries and completing the satellite-based vessel monitoring system 
in accordance with the agreed timelines.  

Concerning regional policy and the coordination of structural instruments, Croatia was able 
to  demonstrate  that  it  fulfils  the  conditions  for  the  waiver  for  ex-ante  controls  for  all  IPA 
components.  Croatia  needs  to  step  up  building  the  administrative  capacity  in  the  relevant 
structures,  finalise  investment  strategies  and  intensify  the  preparation  of  a  pipeline  of  high 
quality and mature projects as the numbers of co-funded projects, of sectors touched and of 
interlocutors  will  substantially  increase  over  the  time.  A  fully  functioning  management, 
monitoring and evaluation system needs to be established for the future European Structural 
and Investment Funds. Croatia needs to ensure that all relevant and necessary procedures are 
put in place to ensure an effective, regular and transparent use of the European Structural and 
Investment Funds, especially as far as public procurement is concerned. 

With  regard  to  the  environment  and  climate  change,  administrative  capacity  has  been 
strengthened.  Concerning  the  environment,  legislative  alignment  and  implementation  are 
nearing  completion.  Particular  attention  needs  to  be  paid  to  ensure  proper  environmental 
impact  assessments  for  all  investment  projects,  the  timely  issuing  of  permits  and  the 
upgrading of the Industrial Pollution Control and Risk Management (IPPC) installations. With 
regard to climate change, the transposition of the geological storage of CO2 Directive needs 
to  be  completed.  Croatia  needs  to  ensure  the  implementation  of  the  EU  Emissions  Trading 
System, in particular the full monitoring of and reporting on installations, and prepare for the 
inclusion of aviation, in accordance with agreed timelines. 

Priority action 

Increase the capacity to translate and revise the acquis so that this task can be completed in 
time for accession. 

Croatia  has  completed  this  priority  action.  Croatia  has  considerably  increased  the  pace  of 
translating  and  revising  the  acquis  thanks  to  an  improved  internal  organisation,  additional 
staff  and  support  provided  by  EU  institutions.  The  number  of  translated  and  revised  pages 
increased to more than 118,000 pages (13 March). Provided Croatia maintains this speed over 
the coming weeks the translation and revision work will be finalised in time before accession.  

Some important initial steps have been taken regarding the implementation of urgently needed 
structural  reforms  in  the  economy,  to  improve  competitiveness  and  growth  prospects. 
Croatia's informal participation in the 2013 European Semester provides a good opportunity 
to  develop  the  structural  reform  agenda  further  and  to  pursue  its  vigorous  implementation. 
Within this framework, the Commission will assess the Economic Programme to be submitted 
by Croatia in April. 

In  the  field  of  taxation,  Croatia  introduced  in  November  2012  a  new  reduced  VAT  rate  on 
yachts  (sport  and  pleasure  boats),  which  is  contrary  to  the  EU  acquis  but  which  will  be 
aligned  by  accession.  This  may  encourage  releasing  boats  for  free  circulation  in  Croatia 
before accession. Croatia should without delay reverse this situation. 

The  Commission  welcomes  the  signing  by  Croatia  and  Slovenia  of  a  Memorandum  of 
Understanding,  in  March  2013,  defining  a  mutually  acceptable  solution  to  the  issue  of  the 
transferred foreign currency savings of the Ljubljanska banka in Croatia. 

3. CONCLUSIONS 

Croatia  is  generally  meeting  the  commitments  and  requirements  arising  from  the  accession 
negotiations,  in  all  chapters.  Croatia  has  demonstrated  its  ability  to  fulfil  all  other 
commitments in good time before accession. Where required, clear work plans are available 

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or  about  to  be  finalised  for  completing  the  remaining  work,  including  in  the  fight  against 
corruption, in the months ahead. 
Moreover,  Croatia  has  completed  the  ten  priority  actions  identified  in  the  Commission's 
Comprehensive Monitoring Report of October 2012. The Commission is therefore confident 
that Croatia will be ready for membership on 1 July 2013.  

Croatia's forthcoming accession is the result of 10 years of a rigorous process, which started 
with  its  application  for  membership  in  2003.  EU  membership  is  an  additional  incentive  to 
continue  reforms  in  Croatia.  Building  on  the  achievements  to-date,  Croatia  is  expected  to 
continue developing its track record in the field of the rule of law, notably in the fight against 
corruption. EU membership also offers many and substantial opportunities for Croatia and the 
EU. These opportunities now need to be used, so that Croatia's participation in the EU will be 
a success – to the benefit of Croatia itself, of the Western Balkans region, and of the EU as a 
whole. 

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