COMMISSION STAFF WORKING DOCUMENT Montenegro 2022 Report Accompanying the document Communication from the Commission to the European Parliament, the Council, the European Economic and Social Committee and the Committee of the Regions 2022 Communication on EU Enlargement policy
Date: 2022-10-12
Institutions: Directorate-General for Neighbourhood and Enlargement Negotiations, European Commission
Subjects: Montenegro, accession criteria, accession negotiations, pre-accession strategy

EN 

  EN 

   EUROPEAN COMMISSION  Brussels, 12.10.2022  SWD(2022) 335 final  COMMISSION STAFF WORKING DOCUMENT Montenegro 2022 Report Accompanying the document Communication from the Commission to the European Parliament, the Council, the European Economic and Social Committee and the Committee of the Regions 2022 Communication on EU Enlargement policy                   {COM(2022) 528 final} - {SWD(2022) 332 final} - {SWD(2022) 333 final} - {SWD(2022) 334 final} - {SWD(2022) 336 final} - {SWD(2022) 337 final} - {SWD(2022) 338 final}  
 
 
1. INTRODUCTION................................................................................................................. 3 

1.1  

1.2  

CONTEXT ................................................................................................................. 3 

SUMMARY OF THE REPORT  ..................................................................................... 4 

1.3.  

 STATE OF PLAY OF THE ACCESSION NEGOTIATIONS .............................................. 8 

2. CLUSTER 1: THE FUNDAMENTALS OF THE ACCESSION PROCESS ................. 9 

2.1. 

FUNCTIONING OF DEMOCRATIC INSTITUTIONS AND PUBLIC ADMINISTRATION 
REFORM ................................................................................................................... 9 

2.1.1 Democracy ......................................................................................................... 9 

2.1.2. Public administration reform .......................................................................... 15 

2.2. RULE OF LAW AND FUNDAMENTAL RIGHTS.................................................................. 18 

2.2.1  Chapter 23: Judiciary and fundamental rights ............................................ 18 

2.2.2  Chapter 24: Justice, freedom and security .................................................. 45 

2.3. ECONOMIC CRITERIA .................................................................................................... 62 

2.3.1. The existence of a functioning market economy ............................................ 62 

2.3.2. The capacity to cope with competitive pressure and market forces within the 

Union .......................................................................................................... 69 

2.4. PUBLIC PROCUREMENT, STATISTICS, FINANCIAL CONTROL ........................................ 71 

Chapter 5: Public procurement ................................................................................. 71 

Chapter 18: Statistics ................................................................................................ 73 

Chapter 32: Financial control ................................................................................... 74 

3. GOOD NEIGHBOURLY RELATIONS AND REGIONAL COOPERATION ........... 77 

4. 

ABILITY TO ASSUME THE OBLIGATIONS OF MEMBERSHIP ................. 79 

CLUSTER 2: INTERNAL MARKET ........................................................................................ 79 

Chapter 1: Free movement of goods ......................................................................... 79 

Chapter 2: Freedom of movement for workers ......................................................... 81 

Chapter 3: Right of establishment and freedom to provide services ........................ 82 

Chapter 4 - Free movement of capital ...................................................................... 82 

Chapter 6: Company law .......................................................................................... 84 

Chapter 7: Intellectual property law ......................................................................... 85 

Chapter 8: Competition policy .................................................................................. 86 

Chapter 9: Financial services .................................................................................... 88 

Chapter 28: Consumer and health protection ........................................................... 89 

CLUSTER 3: COMPETITIVENESS AND INCLUSIVE GROWTH ................................................ 92 

Chapter 10: Digital transformation and media ......................................................... 92 

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Chapter 16: Taxation ................................................................................................ 94 

Chapter 17: Economic and monetary policy ............................................................. 95 

Chapter 19: Social Policy and employment .............................................................. 97 

Chapter 20: Enterprise and industrial policy ............................................................ 99 

Chapter 25: Science and Research .......................................................................... 100 

Chapter 26: Education and culture .......................................................................... 102 

Chapter 29: Customs union ..................................................................................... 105 

CLUSTER 4: THE GREEN AGENDA AND SUSTAINABLE CONNECTIVITY ............................ 106 

Chapter 14: Transport policy .................................................................................. 107 

Chapter 15: Energy ................................................................................................. 108 

Chapter 21: Trans-European networks ................................................................... 110 

Chapter 27: Environment and climate change ........................................................ 111 

CLUSTER 5: RESOURCES, AGRICULTURE AND COHESION ................................................ 114 

Chapter 11: Agriculture and rural development ..................................................... 114 

Chapter 12: Food safety, veterinary and phytosanitary policy ............................... 115 

Chapter 13: Fisheries .............................................................................................. 117 

Chapter 22: Regional policy and coordination of structural instruments ............... 118 

Chapter 33: Financial and budgetary provisions .................................................... 119 

CLUSTER 6: EXTERNAL RELATIONS .................................................................................. 120 

Chapter 30: External relations ................................................................................ 120 

Chapter 31: Foreign, security and defence policy .................................................. 122 

ANNEX I – RELATIONS BETWEEN THE EU AND MONTENEGRO ...................... 124 

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1. INTRODUCTION  

1.1   CONTEXT  

Accession negotiations with Montenegro were opened in June 2012. To date, 33 negotiating 
chapters  have  been  opened,  of  which  three  have  been  provisionally  closed.  Montenegro 
accepted  the  revised  enlargement  methodology.  Montenegro  continued  to  implement  the 
Stabilisation  and  Association  Agreement  (SAA)  and  meetings  of  the  joint  bodies  under  the 
agreement took place at regular intervals.  

Overall progress in the accession negotiations depends on progress in the area of rule of law, 
as  per  the  requirements  set  out  in  the  Negotiating  Framework  as  well  as  in  the  revised 
methodology formally accepted by Montenegro in the Intergovernmental Conference held on 
22  June  2021.  Progress  towards  meeting  the  interim  benchmarks  set  in  the  rule  of  law 
Chapters  23  and  24  is  key  to  achieving  further  progress  in  the  negotiations  overall,  as  no 
further  chapters  will  be  provisionally  closed  before  this  milestone  is  reached.  The  14th 
Intergovernmental  Conference  held  on  13  December  2021  and  the  SA  Council  held  on  14 
July 2022  provided political  steer on accelerating work to  meet  that milestone.  In order for 
Montenegro  to  take  further  steps  forward  in  the  accession  path,  it  was  urged  to  address  all 
remaining  gaps  in  the  areas  of  freedom  of  expression  and  media  freedom,  the  fight  against 
corruption and organised crime, and to accelerate and deepen reforms on the independence, 
professionalism and accountability of the judiciary. The pace of this work will be determined 
by Montenegro.  

The  Montenegrin  authorities’  political  commitment  to  the  strategic  goal  of  EU  integration 
and their ambition to move forward in the accession negotiations based on continuing reform 
progress  have  been  consistently  stated  as  the  country’s  key  priority.  The  failure  to  build 
consensus on key matters of national interest continued and caused two governments to fall 
on  votes  of  no-confidence.  Political  volatility,  government  instability  and  tensions  have 
stalled decision-making processes and reform implementation.  

Montenegro’s continued full alignment with the EU’s foreign and security policy, including 
EU restrictive measures following Russia’s unprovoked aggression against Ukraine, its vocal 
support for EU initiatives at the UN in response to this aggression, as well as for international 
law  and  a  rules-based  international  order,  is  commendable.  This  is  a  strong  signal  of  the 
country’s strategic orientation and commitment to the goal of EU accession. 

Political  commitment,  credible  engagement  and  consensus  building  by  all  relevant 
institutions and actors in carrying out Montenegro’s EU reform agenda remain fundamental. 
It  is  important  that  all  political  actors  exercise  their  responsibility  to  participate  in  political 
debates  in  Parliament  and  engage  in  constructive  coordination  on  all  relevant  EU-related 
legislative initiatives. 

The  COVID-19  pandemic  continued  throughout  the  reporting  period.  In  spring  2022, 
Montenegro lifted partially the restrictions, introduced to limit the severity of the pandemic. 
During  the  reporting  period,  Montenegro  adopted  fiscal  measures  to  mitigate  the  severe 
economic and social impact of the crisis.  

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1.2  

SUMMARY OF THE REPORT1  

As regards the political criteria, political tensions, polarisation, the absence of constructive 
engagement  between  political  parties  and  the  failure  to  build  consensus  on  key  matters  of 
national  interest  continued  and  caused  two  fractious  governments  to  fall  on  votes  of  no-
confidence. The proper functioning of Montenegrin institutions has been affected by political 
volatility, government instability and tensions within the ruling majorities, stalling decision-
making  processes  and  reform  implementation.  The  main  judicial  bodies,  including  the 
Constitutional  Court,  have  been  operating  in  an  incomplete  composition  due  to  the 
Parliament’s  inability to  elect  new members, thus  undermining their proper functioning.  As 
of mid-September the Constitutional Court was unable to fulfil its role due to the absence of a 
quorum, amplifying political uncertainty. 

The  conclusion  of  the  Fundamental  Agreement  with  the  Serbian  Orthodox  Church  had  an 
impact on the political atmosphere and raised further tensions. Overall, the governments and 
the Parliament failed to  demonstrate in practice their engagement as regards the EU-related 
reform agenda. 

There  was  no  progress  with  regard  to  a  comprehensive  reform  of  the  electoral  legal  and 
institutional  framework,  including  on  the  Organization  for  Security  and  Co-operation  in 
Europe  (OSCE)  Office  for  Democratic  Institutions  and  Human  Rights  (ODIHR) 
recommendations,  following  the  observation  mission  of  the  2020  parliamentary  elections. 
The Parliamentary Committee for a comprehensive electoral reform was not operational from 
June until November 2021 and met only twice in 2022, before its mandate come to an end in 
July  2022.  Local  elections  took  place  in  five  municipalities.  In  May  2022,  the  Parliament 
adopted  amendments  to  the  Law  on  Local  Self-Government  allowing  to  hold  all  remaining 
2022  local  elections  on  the  same  day.  In  July,  the  Constitutional  Court  assessed  these 
amendments as unconstitutional. A credible, independent and effective institutional response 
to the so called ‘envelope affair’ remains to be ensured. 

The work of the Parliament has been marked by  boycotts of the ruling majority  and of the 
opposition,  changes  of  governments  and  by  the  change  of  two  consecutive  Speakers  in  the 
process.  The  legislation-making  process  was  significantly  affected.  There  was  no  credible 
political dialogue and constructive engagement by political parties with a view to enhancing 
parliamentary  accountability  and  government  oversight.  Government  and  Parliament 
cooperation  should  be  further  regulated  to  enhance  Parliament’s  participation  in  and 
oversight of the accession process.  

The  Parliament  continued  to  strengthen  its  transparency,  by  establishing  several  citizen-
oriented services. The capacity of Parliament to integrate and oversight gender equality issues 
needs to be enhanced.  

The  role  of  civil  society  is  recognised  and  promoted,  although  the  current  legal  and 
institutional  framework  needs  to  be  further  improved  to  strengthen  the  consultation  and 
cooperation mechanisms between state institutions and civil society in the context of the EU 
accession process. 

1  This  report  covers  the  period  from  June  2021  to  June  2022.  It  is  based  on  input  from  a  variety  of  sources, 
including  contributions  from  the  government  of  Montenegro,  the  EU  Member  States,  European  Parliament 
reports and information from various international and non-governmental organisations. This also includes the 
results of comparative assessments and indices produced by other stakeholders, in particular on the rule of law. 
The  report  uses  the  following  assessment  scales  to  describe  the  state  of  play:  early  stage,  some  level  of 
preparation,  moderately  prepared,  good  level  of  preparation  and  well  advanced.  To  describe  progress  made 
during  the  reporting  period,  it  uses  the  following  scale:  backsliding,  no  progress,  limited  progress,  some 
progress, good progress and very good progress. Where appropriate, interim steps have been used. 

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Montenegro  is  moderately  prepared  as  regards  public  administration  reform.  Overall, 
limited progress was made, including the adoption of the new 2022-2026 strategy for public 
administration  reform.  Conversely,  the  effects  of  the  reorganisation  of  the  public 
administration and the amendments to the Law on civil servants and state employees adopted 
in  2021  continued  to  be  felt,  with  staff  changes,  a  loss  of  know-how  on  EU  accession 
process-related  matters  and  an  overall  slowing  of  the  pace  of  reforms.  The  lowered 
requirements introduced by these amendments are a source of continuing concern with regard 
to the merit-based recruitment, competence and independence of civil servants. Furthermore, 
draft  amendments  of  the  Law  on  local  self-government  would  similarly  lower  such 
requirements at the local level. Amendments to the Law on access to information have yet to 
be adopted by Parliament. Effective lines of accountability within the administration are still 
to be established. Strong political will is needed to effectively address issues related to merit-
based  recruitments,  optimisation  of  the  state  administration  and  implementation  of 
managerial accountability. 

Montenegro  remains  moderately  prepared  when  it  comes  to  its  judicial  system.  Limited 
progress  was  achieved  overall  during  the  reporting  period.  The  implementation  of  key 
judicial reforms remains stalled. Certain long-pending high-level judicial appointments took 
place,  while  several  others,  including  at  the  Constitutional  Court  (for  which  a  qualified 
majority  in  Parliament  is  required)  are  still  pending.  Concerns  remain  over  the  institutional 
performance and consolidation of independent Judicial and Prosecutorial Councils. The track 
record  on  judicial  accountability  remains  limited.  The  judiciary’s  effective  independence, 
integrity,  accountability  and  professionalism  need  to  be  further  strengthened,  including  by 
implementing  the  relevant  constitutional  and  legal  framework  and  by  adopting  legislative 
changes  in  line  with  European  standards.  The  judiciary’s  efficiency  also  needs  to  be 
strengthened. The adoption of a new strategy for the rationalisation of the judicial network is 
still  pending,  as  is  the  implementation  of  the  ICT  strategy  for  the  judiciary.  Montenegro 
continues to make progress on the domestic handling of war crimes.  

Montenegro has achieved some level of preparation in the fight against corruption. Limited 
progress  was  achieved  during  the  reporting  period,  with  last  year’s  recommendations  only 
partially met. The track record on prevention of corruption further improved, in particular due 
to the positive trend in the work of the Anti-Corruption Agency. However, more needs to be 
done  to  ensure  the  Agency’s  integrity,  impartiality  and  accountability,  and  to  improve  its 
tangible results and public trust, in line with the recommendations of the peer review mission 
conducted  in  2021.  To  demonstrate  a  credible  criminal  justice  response,  Montenegro  still 
must improve its track record of investigations, prosecutions and final convictions in the fight 
against  corruption,  including  high-level  corruption.  Furthermore,  the  legal  and  institutional 
framework must be improved in line with the EU acquis and European standards, including 
for  the  effective  use  of  financial  investigations  and  asset  seizure  and  confiscation  in  such 
cases.  The  sectors  most  vulnerable  to  corruption  require  targeted  risk  assessments  and 
dedicated action.  

In  the  fight  against  organised  crime,  Montenegro  has  some  level  of  preparation/is 
moderately prepared. Some progress was made in addressing last year’s recommendations, in 
particular  as  regards  the  efficiency  of  criminal  investigations.  The  full  use  of  special 
investigative  measures  was  restored.  Legislative  changes  introduced  safeguards  against 
political influence over the appointment or dismissal of the Head of the police. A register of 
beneficial ownership was created. The administrative framework  on firearms was improved 
and  a  new  strategy  on  the  prevention  of  terrorism,  money  laundering  and  the  financing  of 
terrorism was adopted. Some key figures in organised crime groups were arrested and another 
record  of  drug  seizures  was  reached.  The  first  joint  investigation  team  with  a  third  country 

5 

 
 
was  launched.  The  number  of  final  convictions  in  organised  crime  cases  is  on  the  rise. 
However,  the  track  record  of  court  decisions  on  tobacco  smuggling  and  money  laundering, 
the use of financial investigations and the capacity to confiscate the proceeds of crime needs 
to  be  strengthened.  Montenegro  has  yet  to  address  some  systemic  deficiencies  that  exist 
across the board in its criminal justice system, including the way organised crime cases are 
handled in courts. This will require a more deterrent sentencing policy and a revision of the 
use of plea bargains in organised and serious crime cases. 

Montenegro is  moderately prepared in  the  area of fundamental rights. The legislative  and 
institutional framework is largely in place and Montenegro continues to meet its international 
obligations on human rights. However, additional efforts remain needed to implement it fully. 
On freedom of expression, Montenegro benefits  from  a pluralistic media environment  and 
has  achieved  some  level  of  preparation.  Limited  progress  was  made  on  last  year’s 
recommendations.  The  legal  framework  on  the  protection  of  journalists  and  other  media 
workers  was  improved  thanks  to  the  adoption  of  amendments  to  the  Criminal  Code  laying 
down more stringent penalties against attacks and threats against journalists and obstructing 
or  preventing  them  from  performing  their  work.  However,  the  lack  of  effective  judicial 
follow-up  on  important  old  cases  remains  a  matter  of  serious  concern.  The  revision  of  the 
legal framework and the drafting of a new media strategy remain pending, in order to ensure 
their  mutual  consistency  and  full  alignment  with  the  EU  acquis  and  relevant  European 
standards.  Sustained  efforts  are  needed  to  counter  disinformation  and  limit  the  effects  of 
online  harassment  and  hate  speech,  without  disproportionately  limiting  freedom  of 
expression.  The  public  broadcaster  RTCG  continued  to  produce  politically  balanced  and 
diverse  content.  Deep  political  polarisation  of  the  media  scene  persisted,  while  growing 
competition from big regional media placed additional strain on the local media market. 

On  the  economic  criteria,  Montenegro  has  made  good  progress  and  is  moderately 
prepared in developing a functioning market economy. After experiencing a sharp recession 
in 2020, the economy recorded a strong rebound in 2021 and kept growing at a steady pace in 
the  first  half  of  2022  as  the  removal  of  COVID-19  restrictions  buoyed  both  domestic  and 
external demand. The recovery led to surging revenues and a very large improvement in the 
budget  balance.  The  fallout  from  Russia’s  war  against  Ukraine  has  been  limited  so  far, 
despite these two countries’ very significant contribution to Montenegro’s tourism in the past. 
Driven  by  surging  global  commodity  prices,  inflation  increased  significantly.  The 
government adopted an ambitious fiscal reform programme (called ‘Europe Now’) to support 
the  post-pandemic  recovery  and  provided  fiscal  stimulus  measures  easing  the  burden  on 
households from rising energy and food prices. External imbalances decreased significantly 
thanks to the rebound of tourism, while the state of the labour market started to improve, even 
if structural problems persist. The banking system remained stable and non-performing loans 
did not increase significantly in 2022 after the expiry in 2021 of the loan moratorium adopted 
in the context of the COVID-19 crisis. 

Montenegro has made some progress and is moderately prepared to cope with competitive 
pressure  and  market  forces  within  the  EU.  The  last  two  governments  worked  to  improve 
innovation  capacities  and  to  set  the  basis  for  a  green  and  digital  transition  in  an  effort  to 
diversify  Montenegro’s  narrow  production.  In  particular,  modern  telecommunications  and 
ambitious green energy projects are being deployed. However, infrastructure gaps persist, as 
the country’s administrative and financial capacities to implement major public investments 
remains  limited.  The  education  system  still  faces  numerous  challenges  over  a  chronic 
shortage of science, technology, engineering and mathematics (STEM) graduates. In addition, 
the low value added of domestic products, the small size of local companies and low level of 

6 

 
 
participation 
competitiveness of local firms. 

in  exports 

represent  obstacles 

for 

increasing 

the  productivity  and 

On good neighbourly relations and regional cooperation, Montenegro generally maintains 
good bilateral relations with other enlargement countries in the region and with neighbouring 
EU Member States, marked by continued cooperation and several high-level visits. Relations 
with  Serbia  remain  challenging  but  both  sides  are  signalling  more  willingness  to  reset 
relations  and  work  toward  addressing  open  issues.  In  general,  Montenegro  actively 
participates in regional cooperation. 

On  Montenegro’s  ability  to  assume  the  obligations  of  EU  membership,  the  country 
continued  the  work  on  alignment  with  the  EU  acquis  in  many  areas,  however  overall  the 
progress made was limited. 

The  cluster  on  the  internal  market  is  key  for  Montenegro’s  preparations  for  the  EU’s 
requirements in this area and is of high relevance for early integration and the development of 
the  Common  Regional  Market.  All  nine  chapters  are  open,  with  closing  benchmarks  that 
remain  to  be  fulfilled  in  each  chapter.  Progress  was  achieved  in  several  areas  within  the 
cluster,  particularly  on:  (i)  market  surveillance,  accreditation  and  standardisation;  (ii) 
stepping  up  the  Employment  Agency’s  capacity  on  the  European  network  of  employment 
services; (iii) continued alignment with the Services Directive; (iv) legislation on accounting; 
(v)  acquis  alignment  on  intellectual  property  rights  and  (vi)  State  aid  transparency  and 
ordering  recovery  of  unlawful  State  aid.  The  stability  of  Montenegro’s  banking  sector  also 
advanced,  as  did  legislative  alignment  on  consumer  protection  and  the  adoption  of 
implementing legislation on health protection.  

The  competitiveness  and  inclusive  growth  cluster  and  the  reforms  concerned  have 
significant links to Montenegro’s economic reform programme. All eight chapters are open, 
with closing benchmarks set in all but two, namely Chapters 25 (science and research) and 26 
(education and culture)  both of which are provisionally closed. Closing benchmarks remain 
to be fulfilled in each of the other six chapters. Some progress was achieved in various areas, 
namely on the alignment with the Broadband Cost Reduction Directive, on tax legislation and 
on  administrative  cooperation  and  mutual  assistance.  There  was  also  progress  on  further 
implementation  of  the  revised  industrial  policy.  By  contrast,  there  was  slow  progress  on 
preparations  for  accession  to  the  Convention  on  a  Common  Transit  Procedure,  on 
implementing  actions  envisaged  in  the  2018-2022  trade  facilitation  strategy,  and  on 
implementing the action plan for alignment with the EU  acquis on economic and monetary 
policies. 

The green agenda and sustainable connectivity cluster is at the heart of the Green Agenda 
for  the  Western  Balkans  and  closely  linked  to  Montenegro’s  economic  reform  programme 
and  the  Commission’s  Economic  and  Investment  Plan.  All  four  chapters  are  open,  with 
closing benchmarks that remain to be fulfilled in each chapter. Some progress was achieved 
on creating a functioning day-ahead energy market and on preparing for membership of the 
Paris Memorandum  of Understanding on  Port  State Control. There was limited progress  on 
the review and implementation of the transport development strategy; on water management 
and by improved climate change reporting. 

The  cluster  on  resources,  agriculture  and  cohesion  comprises  policies  linked  to  EU 
structural funds and to developing capacity to assume the responsibilities of a future Member 
State.  It  also  comprises  some  of  the  key  policy  areas  crucial  for  ensuring  sustainable  food 
systems  and  helping  rural  communities  to  develop  and  diversify  economically.  All  five 
chapters  are  open,  with  closing  benchmarks  that  remain  to  be  fulfilled  in  each  chapter. 

7 

 
 
Progress was achieved in various areas, notably in agriculture, food and fisheries, where there 
was further support for agricultural establishments and rural food companies to align with the 
EU standards, and in implementing IPARD. On financial and budgetary provisions, progress 
was achieved through improved coordination and management of own resources. 

On the external relations cluster, Montenegro has provisionally closed Chapter 30 and has to 
fulfil the single closing benchmark on Chapter 31. Montenegro continues full alignment with 
the EU’s common foreign and security policy, including with the EU’s restrictive measures 
following  Russia’s  unprovoked  aggression  against  Ukraine.  It  also  coordinates  its  positions 
with  those  of  the  EU,  including  within  the  WTO  and  maintains  good  cooperation  with 
international  organisations.  Progress  can  be  noted  on  the  adoption  of  the  Law  on  export 
control  of  dual-use  goods,  in  line  with  the  EU  acquis,  and  the  ratification  of  Central 
European  Free  Trade  Agreement  (CEFTA)  Additional  Protocol  6.  Montenegro’s  voting 
patterns on cybercrime at the United Nations are fully convergent with the position taken by 
the EU  and its  Member  States.  In the  area of  migration, Montenegro signed a cooperation 
roadmap with  the European Asylum Support  Office (now the EU Agency  for Asylum) and 
joined the European Migration Network, an EU network of migration and asylum experts, as 
an  observer  member.  The  processing 
time  for  asylum  applications  was  reduced. 
Montenegro’s visa policy is not fully aligned with that of the EU and Montenegro has not yet 
terminated  its  investor  citizenship  programme,  despite  previous  recommendations  and 
commitments. Montenegro is the Western Balkan partner hosting  proportionally the highest 
number of Ukrainian nationals having fled the war. It adopted a decision granting one-year 
temporary  protection  to  people  fleeing  Ukraine,  under  which  more  than  5 552  Ukrainians, 
mostly women and children, have registered so far. 

1.3.  

 STATE OF PLAY OF THE ACCESSION NEGOTIATIONS  

CLUSTERS 

Chapters/areas  

Date chapter opened / closed with 
interim or closing benchmarks  

Fundamentals 

23 – Judiciary and fundamental rights  

December 2013  

All chapters open 

  5 – Public procurement  

24 – Justice, freedom, security  

18 – Statistics   

32 – Financial control 

… Economic criteria 

December 2013  

December 2013  

December 2014 

June 2014  

… Functioning of democratic Institutions  

… Public administration reform 

- 

- 

Internal market 

 1 – Free movement of goods   

June 2017  

 2 – Freedom of movement for workers   

December 2017  

All chapters open 

 3 – Right of establishment and freedom to  
     establish services  

 4 – Free movement of capital 

 6 – Company law  

 7 – Intellectual property rights  

 8 – Competition   

 9 – Financial services  

28 – Consumer and health protection 

8 

December 2017  

… 

June 2014  

December 2013  

March 2014  

June 2020  

June 2015  

December 2014   

 
 
 
 
 
Competitiveness and 
inclusive growth 

All chapters open  ch.25  
and 26 provisionally 
closed 

Green agenda and 
sustainable connectivity 

All chapters open 

Resources, agriculture 
and cohesion 

10 – Digital transformation and media  

March 2014  

16 – Taxation  

17 – Economic and monetary  

March 2015  

June 2018  

19 – Social policy and employment  

December 2016  

20 – Enterprise and industrial policy  

December 2013  

25 – Science and research 

26 – Education and culture 

29 – Customs union  

14 – Transport policy 

15 – Energy  

December 2012 (opened and closed –  
no closing benchmarks);  

April 2013 (opened and closed – no 
closing benchmarks) 

December 2014   

December 2015  

December 2015  

21 – Trans-European networks 

June 2015  

27 – Environment and climate change  

December 2018  

11 – Agriculture and rural development  

December 2016  

12 – Food safety, veterinary and phytosanitary 
policy 

All chapters open  

13 – Fisheries  

22 – Regional policy and coordination of  
      structural instruments  

33 – Financial and budgetary provisions  

External relations 

30 – External relations  

Both chapters open, ch.30 
provisionally closed  

31 – Foreign, security & defence policy  

June 2016  

June 2016  

June 2017  

… 

December 2014  

March 2015 – June 2017 
provisionally closed 

June 2014   

Not part of a cluster: chapters 34 Institutions, and 35 Other issues are currently not applicable for 
Montenegro. 

2. CLUSTER 1: THE FUNDAMENTALS OF THE ACCESSION PROCESS 

2.1. 

FUNCTIONING  OF  DEMOCRATIC  INSTITUTIONS  AND  PUBLIC  ADMINISTRATION 
REFORM  

2.1.1 Democracy 

In Montenegro, polarisation, the absence of constructive engagement between political forces 
and the  failure to  build  consensus  on key matters  of national  interest  continued and  caused 
two governments  to  fall on votes of no-confidence.  The proper functioning of  Montenegrin 
institutions  has  been  affected  by  political  volatility,  government  instability  and  tensions 
within the ruling majorities, stalling decision-making processes and reform implementation. 
The  main  judicial  bodies,  including  the  Constitutional  Court,  have  been  operating  in  an 
incomplete  composition  due  to  the  Parliament’s  inability  to  elect  new  members,  thus 
undermining  their  proper  functioning.  As  of  mid-September  the  Constitutional  Court  was 
unable to fulfil its role due to the absence of a quorum. No credible efforts have been made to 
overcome the societal  and political  polarisation, which culminated during the enthronement 
of  the  Metropolitan  of  the  Serbian  Orthodox  Church  (SOC)  in  September  2021  and  the 

9 

 
 
 
 
  
  
 
 
 
 
signing of the Fundamental Agreement with SOC in the summer 2022. There was no inter-
party dialogue to address reconciliation and key matters of national interest. Overall, limited 
progress was made on the EU-related reform agenda. 

Elections 

There  was  no  progress  with  regard  to  a  comprehensive  reform  of  the  electoral  legal  and 
institutional  framework,  including  on  the  OSCE/ODIHR  recommendations,  following  the 
observation mission of the 2020 parliamentary elections. The Parliamentary Committee for a 
comprehensive electoral reform had limited activity and its mandate come to an end in July 
2022. Local elections took place in five municipalities. In May 2022, the Parliament adopted 
amendments to the Law on Local Self-Government allowing to hold all remaining 2022 local 
elections  on  the  same  day.  In  July,  the  Constitutional  Court  assessed  these  amendments  as 
unconstitutional. A credible, independent and effective institutional response to the so called 
‘envelope affair’ remains to be ensured. 

The Parliamentary Committee for a comprehensive electoral reform resumed its activities in 
November  2021,  after  the  return  of  four  opposition  Members  of  Parliament  (MP)  who  had 
suspended  their  participation  in  June  2021.  On  30  December  2021,  upon  a  decision  jointly 
supported  by  all  nine  parliamentary  MP  groups,  the  Parliament  extended  the  Committee’s 
mandate until 31 July 2022, but issued no further extensions. There were only two sessions of 
the Committee in 2022.  

In May 2022, amendments made to the Law on Local Self-Government stipulated that local 
elections in Podgorica and 13 other municipalities should be held on the same day, no later 
than  30  October.  The  Democratic  Front  (DF)  political  group  and  two  Non-Governmental 
Organisations  (NGOs)  submitted  a  complaint  to  the  Constitutional  Court  on  the  legality  of 
the Law and in July, the Constitutional Court assessed these amendments as unconstitutional. 
Nevertheless, the President called for elections in all relevant municipalities for 23 October.  

In August, the Parliament passed amendments to the Laws on the territorial organisation of 
Montenegro and the Capital City, which envisages the establishment of a new municipality of 
Zeta  This  reduces  the  number  of  voters  in  Podgorica.  The  Parliament  however  did  not 
appoint a Municipal Election Commission (MEC) for the new municipality, in the absence of 
a MEC, the institution responsible for organizing the elections, they cannot be appropriately 
held. 

The  majority  of  recommendations  of  OSCE/ODIHR  following 
the  August  2020 
parliamentary  elections,  as  well  as  a  number  of  previously  pending  OSCE/ODIHR 
recommendations,  remain  unaddressed,  including  those  related  to  an  audit  of  the  voter 
register,  measures  against  the  misuse  of  state  resources,  as  well  as  certain  limitations  of 
suffrage  rights.  In  addition  to  addressing  the  OSCE/ODIHR  recommendations,  the 
Parliamentary Committee for electoral reform had a mandate to propose new laws on election 
of  MPs  and  councillors,  voter’s  registry,  financing  of  political  entities  and  electoral 
campaigns,  and  registers  of  residence,  a  decision  on  holding  local  elections  in  all 
municipalities in a single day as well as a code of ethics for election campaigns. Furthermore, 
the  Committee  was  tasked  with  analysing  the  implementation  of  and  proposing  possible 
amendments to the Law on identity cards and the Law on Montenegrin citizenship, as well as 
proposing  measures  to  strengthen  the  professionalism  and  transparency  of  the  work  of  the 
State Election Commission (SEC) and the Anti-Corruption Agency (ACA). No progress was 
achieved on any of these issues. Furthermore, no comprehensive audit to enhance public trust 
in  the  voter’s  registry,  for  example  through  conducting  field  tests,  has  been  conducted. 
Previous allegations of double-registered voters in one or more countries of the region need 

10 

 
 
to be thoroughly investigated by the competent authorities. 

Following  the  dismissal  of  the  SEC  President  in  June  2021,  the  new  President  was  elected 
only on 8 December 2021, after local elections were held in Cetinje, Mojkovac and Petnjica. 
Therefore,  the  SEC  could  not  convene  sessions  to  organize  elections  in  prisons  and  to 
accredit  election  observers,  consequently  the  elections  took  place  without  accredited 
observers. The SEC started working on election reform areas that are in its sole competence, 
such  as  analysing  and  revising  its  by-laws,  training  in  local  polling  stations  and  increasing 
transparency  of  SEC  sessions  and  decisions.  In  March  2022,  the  SEC  adopted  revised  by-
laws to ensure easier access to polling stations and a better voting experience for persons with 
disabilities.  In  June,  the  SEC  further  revised  several  by-laws  in  line  with  OSCE/ODIHR 
the  SEC  adopted  voter  complaints  forms  fulfilling  an 
recommendations.  In  July, 
OSCE/ODIHR  recommendation.  The  SEC  signed  a  Memorandum  of  Cooperation  with  a 
NGO to strengthen the transparency of its work. 

After  the  local  election  in  Petnjica,  four  complaints  were  submitted  to  the  local  Municipal 
Election Commission. The MEC and the SEC as second instance rejected all four complaints 
as unfounded. The applicants lodged an appeal against one of the SEC's decisions, which the 
Constitutional  Court  confirmed.  Consequently,  the  elections  in  one  polling  station  were 
repeated. On 28 March 2022, local elections took place in Berane and Ulcinj. After the MEC 
of Ulcinj accepted a complaint, elections were repeated in one polling station. 

There are no new developments in the political and judicial follow-up of the alleged misuse 
of public funds for party political purposes in 2012 on the “audio recordings affair”. Political 
and judicial follow-up to the alleged electoral fraud case the ‘envelope affair’ is still ongoing. 
In September 2021, after two appeals submitted by the Special State Prosecutor’s Office, the 
High Court in Podgorica confirmed an indictment against a former high Democratic Party of 
Socialists (DPS) official for money laundering. 

Parliament 

Deep polarisations and mistrust between and within political coalitions has marked the period 
during which two fractious governments have been in power. The work of the Parliament has 
been  marked  by  boycotts  of  the  ruling  majority  and  of  the  opposition,  changes  of 
governments and by the change of two consecutive Speakers in the process. The legislation-
making process was significantly affected. The Parliament should demonstrate in practise its 
commitment to Montenegro’s EU reform agenda and work on overcoming deep polarisation. 

There  was  no  effective  political  dialogue  and  constructive  engagement  by  political  parties 
with  a  view  to  enhancing  parliamentary  accountability  and  government  oversight. 
Government and Parliament cooperation should be further regulated to enhance Parliament’s 
participation  in  and  oversight  of  the  accession  process.  Relations  between  Parliament  and 
Executive  need  to  be  regulated  by  an  Act  of  Parliament,  as  the  current  Rules  of  Procedure 
were not enacted in the form of a law.  

The  Parliament  continued  to  strengthen  its  transparency,  by  establishing  several  citizen-
oriented services. The capacity of Parliament to integrate and oversight gender equality issues 
needs to be enhanced.  

For  the  first  part  of  the  reporting  period,  tensions  within  the  majority  supporting  the 
government  led  most  MPs  to  boycott  the  plenary  sessions  during  October  and  November 
2021,  with  the  exception  of  a  few  extraordinary  sessions.  This  contributed  to  effectively 
suspending  the  decision-making  processes  in  the  Parliament.  It  was  only  at  the  end  of 
December 2021 that the Parliament convened the ordinary autumn session. 

11 

 
 
In January 2022, the long-lasting divergences within the parliamentary majority led to a vote 
of no-confidence in the Government and its downfall. The Speaker of the Parliament was also 
dismissed. The Parliament convened for its first regular session of the year only on 28 April. 
With the vote of 45 MPs, the Parliament elected a new government led by Mr Abazović and a 
new  Parliament  Speaker.  Following  the  signature  of  a  Fundamental  Agreement  with  the 
Serbian  Orthodox  Church  (SOC)  on  3  August,  the  government  was  opposed  by  part  of  its 
own  majority  and  lost  a  no-confidence  motion  on  19  August.  As  a  result,  the  Montenegrin 
Government is currently exercising its functions in a caretaker mandate, as was also the case 
between January and April 2022. On 30 September the Parliament decided to not debate the 
shortening of its mandate, as had been proposed by the President following the missing of the 
deadline to nominate a new PM designate.  

As regards the Parliament’s legislative role, the occasional boycott of certain parliamentary 
groups weakened the quality of the debates. Bills were often discussed in the absence of basic 
financial assessments and without an adequate opinion of the government. The Parliament's 
capacity to scrutinise draft legislation for compliance with the EU acquis remains limited. 

During the December 2021 session, the Parliament elected a Vice-President of the Parliament 
from  among  MPs  of  minority  parties  and  appointed  the  President  of  the  State  Election 
Commission and the Deputy Protector of Human Rights and Freedoms. At the same sitting, 
the  Parliament  elected  five  lay  members  of  the  Prosecutorial  Council.  The  Parliament  also 
adopted  important  laws  and  decisions,  including  the  2022  Budget  Law,  together  with  eight 
accompanying laws proposed by the government as part of the “Europe Now” programme.  

Efforts were undertaken to improve parliamentary oversight, but effective control remains 
at an early stage. The Rules of Procedure stipulate that the Prime Minister's Hour takes place 
once a month, and eight such sittings were held during the reporting period. The Parliament 
does  not  have  the  capacity  to  hold  ministers  accountable  for  non–attendance  or  lack  of 
answers.  On  three  occasions,  the  previous  Prime  Minister  did  not  accept  interpellations 
adopted by the Parliament against the former ministers.   

Despite procedural  and institutional improvements,  quantitative analysis on the work of the 
Parliament and its working bodies in the reporting period does not show significant progress 
on  oversight,  partly  due  to  occasional  boycott  and  the  consequent  impossibility  for  the 
committees  to  work  in  full  capacity.  Some  committee  chairs,  however,  use  oversight 
proactively.  The  Committee  on  political  system,  judiciary  and  administration  was  the  most 
active, whereas the Committee on Anti-Corruption least active. 

The Parliament continued to improve the level of transparency and communication with the 
public.  The  most  visible  form  of  parliamentary  transparency  is  the  possibility  to  follow 
proceedings  through  the  media  and  on  the  Internet,  by  live  broadcasting  sessions  of  the 
Parliament  and  its  working  bodies  or  on  request  through  the  Parliamentary  Channel.  An 
important innovation is the establishment of the E-petition project, where citizens can contact 
the  Parliament  to  initiate  legislation.  The  project  aims  at  fully  digitalising  the  entire 
legislative  process.  However,  the  project  has  not  been  promoted  enough  and  many  citizens 
are not aware of its existence. 

No  reports  on  violations  of  the  Code  of  Ethics  have  been  submitted  to  the  Committee  on 
Human Rights  and Freedoms in  the reporting period.  The Parliament received 348 citizens' 
petitions, 22 were related to the E-petition legislative initiative.  

The professional and expert capacity of the Parliament’s administrative staff continued being 
strengthened.  In  the  reporting  period,  on  the  proposal  of  the  Administrative  Board,  the 
Parliament passed the decision to allow initiating criminal proceedings against one opposition 

12 

 
 
Member  of  the  Parliament  of  Montenegro,  at  the  request  of  the  Special  State  Prosecutor's 
Office, due to alleged abuse of his official position. The Special State Prosecution Office also 
requested waiving the immunity of five more MPs, without getting approval.  

Politics continue to be male-dominated and it is noticeable that verbal abuse against women 
in  political  life  is  growing,  especially  in  the  public  sphere  and  particularly  towards  the 
younger politicians. Systemic shortcomings remain, and patriarchal attitudes and insufficient 
party interest are still obstacles to a more active involvement of women in politics. The cross-
party Women’s Club in the Parliament continued its active role and initiated discussions on 
improving the legal framework on gender related issues through amendments to the Criminal 
Code. The Committee for Gender Equality improved its oversight function, by organising a 
number of consultative control hearings. MPs and parliamentary staff increased their capacity 
in  gender-responsive budgeting and gender assessments  in  drafting and adopting legislation 
and policies. 

Shortcomings  in  the  legal  framework  regulating  political  parties  and  their  funding  persist. 
The results produced by the Anti-corruption Agency’s and the State Audit Institution’s work 
on the monitoring of political parties’ financing are very limited. More efforts are needed to 
strengthen  the  control  mechanisms  and  political  parties  should  follow-up  on  their 
recommendations in a more effective and transparent manner.  

Inappropriate speech still dominates some debates, with MPs using terms that in the context 
of  deepened  political,  social  and  ethnic  divisions  do  not  contribute  to  much-needed 
reconciliation and improved inter-party dialogue. 

Governance 

The  reporting  period  was  marked  by  turmoil  within  the  ruling  majorities,  which  brought 
about a blockage of several  reform processes and government activities, and had an impact 
on the effective institutional functioning of the country. A Minister of Justice was dismissed 
in  June  2021  and  until  April  2022  no  replacement  was  appointed.  From  beginning  of 
February until 28 April 2022, the government exercised its duties as a caretaker, a number of 
senior appointments were made at the end of the mandate. The current government has been 
fully on duty for less than four months, and is currently continuing in a caretaker capacity. 

Montenegro continued to implement its national programme for EU accession. In November 
2021, the government adopted the “Information on the need to form working groups for the 
programming  of  the  EU  Instrument  for  Pre-Accession  Assistance  for  the  period  2021-2027 
(IPA III)” and “Information on progress in the process of negotiations on a cluster approach”. 
On  28  April  2022  the  Ministry  of  European  Affairs,  under  the  responsibility  of  a  Deputy 
Prime  Minister,  leading  the  negotiation  process  with  the  EU,  was  established.  In  August 
2022, the government adopted decisions on a new EU negotiation structure and amended the 
decisions on working groups for negotiation Chapters 23 and 24. The new structure consists 
of  the  Negotiation  Collegium,  Council  for  Rule  of  Law,  Negotiation  Team,  negotiation 
working  groups,  and  the  Ministry  of  European  Affairs.  The  negotiating  structure  has  been 
slimmed down considerably. 

Overall, transparency of governance  remained an issue. However, some positive steps were 
made, including a regular, proactive publication of information on all expenditures from the 
central budget.  

Until  April  2022,  the  government  frequently  resorted  to  the  procedural  option  of  adopting 
decisions  without  formally  convening  a  government  session  and  at  the  end  of  December 
2021, extended the level of "confidential" for another five years for audio recordings from the 
sessions. Government sessions are now online broadcasted.  

13 

 
 
As for local governance, there has been some progress reflected in more efficient and better-
quality  strategic  planning  processes  at  local  level.  Twenty-three  municipalities  developed 
their  Strategic  Development  Plans.  All  municipalities  in  Montenegro  established  local 
employment partnerships. 

The  “Europe  Now”  programme  affected  revenues  of  municipalities,  decreasing  revenues  in 
some local governments even up to 75%, as compared to February 2021. At the same time, 
municipalities  received  lower  contributions  from  the  Equalization  Fund,  which  hampers 
sustainable budgeting, especially for the poorest municipalities. 

New  local  government  governments  were  established  in  Cetinje,  Mojkovac  and  Petnjica, 
following the December 2021 local elections, and in Ulcinj and Berane following elections in 
March  2022.On  31  March  2022,  the  government  dissolved  the  Municipal  Assembly  of 
Budva,  on  the  grounds  of  not  performing  its  competencies  for  more  than  six  months  and 
appointed  a  Board  of  Trustees,  which  elected  in  August  2022  a  new  mayor  of  Budva  who 
will exercise its functions until the new local elections take place.  

Women’s  political  participation  remains  low  at  the  local  level.  For  the  most  recent  local 
elections in Berane, two electoral lists were submitted and confirmed, even though they failed 
to ensure the legally binding quota of 30% of women candidates. There is a need to introduce 
mandatory  gender  budgeting  and  assign  more  funds  to  women’s  entrepreneurship  at  local 
level  and  to  ensure  gender  mainstreaming  at  all  levels  of  decision  making,  policy  planning 
and implementation. 

Civil society 

The  role  of  civil  society  is  recognised  and  promoted,  although  the  current  legal  and 
institutional  framework  needs  to  be  further  improved  to  strengthen  the  consultation  and 
cooperation mechanisms between state institutions and civil society in the context of the EU 
accession  process.  Amendments  to  the  Law  on  free  access  to  information  and  the  law  on 
volunteering  are  yet  to  be  adopted.  New  members  of  the  Council  for  Cooperation  of  State 
Bodies and Non-Governmental Organisations need to be appointed, so that it can resume its 
work. Although funding rules to civil society organisations (CSOs) are in place, only a few 
ministries  launched  calls  to  award  grants  to  such  organisations.  The  quality  of  cooperation 
between state bodies and civil society would be enhanced if ministries had greater capacity to 
carry out strategic planning, monitoring and evaluation of the support they provide to CSOs. 

An empowered civil society is a crucial component of any democratic system and should be 
recognised and treated as such by state institutions. 

The  overall  legal  and  institutional  framework  on  freedom  of  expression,  of  association  and 
assembly  is  in  place.  Draft  amendments  to  the  Law  on  access  to  information,  drafted  in 
consultation with civil society organisations are pending adoption. Information classified by 
public institutions and withheld from the public remains an issue, as in practice this restricts 
the  access  of  CSOs  and  the  public  to  key  policy  decisions.  This  concern  needs  to  be 
addressed  as  a  matter  of  priority.  Montenegro  does  not  have  a  law  on  volunteering,  which 
would be needed to promote and regulate volunteer work in CSOs and hence increase their 
human  resources.  After  the  2018-2020  strategy  for  cooperation  with  NGOs  expired,  a  new 
(2022-2026) strategy was adopted in July 2022.   

The role of civil society in the accession process is recognised and promoted at political level 
and  CSOs  are  represented  in  working  groups  devoted  to  the  chapters  of  the  EU  accession 
negotiations. In 2021, most ministries appointed representatives of CSOs to working groups 
in charge of drafting laws and national strategies in their respective areas; this is an obligation 

14 

 
 
under  the  Law  on  public  administration.  However,  not  all  ministries  conducted  public 
consultations  when  draft  laws  and  strategies  were  prepared.  A  significant  number  of  laws 
were adopted without prior consultation of civil  society. The consultation mechanisms with 
civil society need to be further improved, in order for it to become useful and effective. 

The  Council  for  Cooperation  of  State  Administration  Bodies  and  Non-Governmental 
Organisations,  a  body  consisting  of  an  equal  number  of  state  officials  and  CSO 
representatives,  held  only  one  meeting  in  2021.  The  Council  rules  were  amended  in  July 
2021,  to  make  its  work  more  transparent,  in  compliance  with  the  new  Decree  on  the 
organisation  and  operation  of  state  administration.  Under  these  amendments,  documents 
discussed by the Council and minutes of its meetings are published. External participants and 
representatives of vulnerable groups can be invited to its meetings when relevant. However, 
no new Council members have been appointed so far  following the expiry  of the Council’s 
term  of  office  in  September  2021.  If  the  Council  is  to  fulfil  its  function  effectively,  it  will 
need to improve its visibility and its outreach to CSOs and make sure that its rules function. 

The  rules  for  public  funding  of  CSOs  require  all  ministries  to  conduct  consultations  with 
CSOs on their annual funding priorities, to publish open calls and to award grants through a 
selection process involving external evaluators. Some EUR 3.7 million from the state budget 
were  allocated  to  CSO  projects  in  2021,  including  EUR  928 302  to  co-finance  25  CSO 
projects supported by the EU. However, not all ministries have launched calls to award grants 
to  CSOs,  despite  the  obligation  to  do  so,  laid  down  in  the  Law  on  NGOs.  In  some  cases, 
contracts with CSOs were signed but funds were not disbursed. New external evaluators were 
selected  to  improve  the  quality  of  the  evaluation.  However,  90  %  of  the  newly  selected 
evaluators were the same as in the previous year. The capacity of ministries to monitor and 
evaluate projects implemented by CSOs is still to be strengthened. Some EUR 4 million were 
allocated for funding or co-funding CSO projects in 2022.  

CSOs  can  also  access  funds  at  local  level,  according  to  the  Law  on  local  self-government. 
However,  most  of  the  local  authorities  do  not  launch  calls,  or,  when  they  do  so,  the 
transparency of the process needs to be improved. 

2.1.2. Public administration reform 

Montenegro  is  moderately  prepared  on  the  reform  of  its  public  administration.  Overall,  limited 
progress was made, including the adoption of the new 2022-2026 strategy for public administration 
reform.  Conversely,  the  effects  of  the  reorganisation  of  the  public  administration  and  the 
amendments to the Law on civil servants and state employees adopted in 2021 continued to be felt, 
with  staff  changes,  a  loss  of  know-how  on  EU  accession  process-related  matters  and  an  overall 
slowing  of  the  pace  of  reforms.  The  lowered  requirements  introduced by  these  amendments  are a 
source  of  continuing  concern  with  regard  to  the  merit-based  recruitment,  competence  and 
independence of civil servants. Furthermore, draft amendments of the Law on local self-government 
would  similarly  lower  such  requirements  at the local level.  Amendments  to  the  Law  on  access  to 
information  remain  to  be  adopted  by  Parliament.  Effective  lines  of  accountability  within  the 
administration are still to be established.  

Strong  political  will  is  needed  to  effectively  address  issues  related  to  merit-based  recruitments, 
optimisation of the state administration and implementation of managerial accountability. Most of 
the recommendations from 2021 remain valid. In the coming year, Montenegro should in particular:  

  implement the new public administration reform strategy, in line with the relevant action plans 
and  mid-term  budgetary  framework;  adopt  the  new  public  financial  management  reform 
programme and start its implementation;  

  improve  Montenegrin  citizens’  access  to  public  information  by  finalising,  adopting  and 

15 

 
 
implementing  amendments  to  the  Law  on  access  to  information  in  line  with  the  principles  of 
good public administration;  

  ensure effective lines of accountability between and within the institutions;  amend the Law on 
civil  servants  and  state  employees  and  the  Law  on  local  self-government  in  order  to  ensure 
recruitments according to the principles of merit, competence and transparency. 

Strategic framework for public administration reform  

Given  that  the  previous  2016-2020  public  administration  reform  (PAR)  strategy  had 
expired in 2020, the year 2021 was without a strategic framework until the year’s end. The 
government adopted a dynamic action plan for October-December 2021 covering issues not 
completed under the previous strategy, but results remained limited given the main focus on 
developing the new strategy.   

In  December  2021,  the  government  adopted  a  new  PAR  strategy  for  2022-2026  and  an 
action  plan  for  2022-2024.  Civil  society  organisations  were  actively  involved  in  the 
preparation of the new strategy. Political support for public administration reform continued 
to be ensured through the PAR Council, chaired by the Prime Minister, with three sessions in 
2021.  The  PAR  strategy  is  linked  to  annual  budgeting  and  the  mid-term  budgetary 
framework. However, reliance on donor funding continues to be substantial.  

The  overall  quality  of  strategic  documents  produced  over  the  reporting  period  improved, 
and  the  documents  are  largely  aligned  with  the  standards  set  out  in  the  decree  for  strategic 
planning and related methodology. Proper costing of strategic documents and their linkages 
to the budgetary process require particular attention.   

Policy development and coordination 

In Montenegro, the legal framework for policy development is in place. In January 2022, the 
government adopted its medium-term work programme covering 2022-2024, with a detailed 
work plan for 2022. However, the priority pillars and objectives from the work programme 
are still neither interlinked nor aligned with the programme structure of the budget. 

Institutional structures for a coherent policy-making system and coordination are in place. 
However, the central  coordination and quality control role of the General  Secretariat  of the 
Government needs to be strengthened.  

Evidence-based policy-making continues to be only partially ensured. While administrative 
data collection has improved, the quality of data has  yet to be enhanced. Regulatory impact 
assessments are systematically produced, but their quality needs to be further improved. The 
legal  requirements  for  inter-ministerial  and  public  consultations  are  in  place.  However,  the 
quality of the public consultation process in terms of both set-up and follow up has yet to be 
improved.  Public  scrutiny  of  the  government’s  work  should  also  be  further  strengthened. 
Most  government  policy  reports  are  activity-  rather  than  results-based,  making  it  more 
difficult to measure achievements. Communication with the public on ongoing reforms needs 
to be improved. 

Public financial management (PFM) 

The  implementation  of  the  action  plan  for  the  2016-2020  PFM  reform  programme  was 
extended to 2021, allowing for the consolidation of previous results in programme-based and 
gender-sensitive budgeting, performance budgeting and the gradual implementation of a mid-
term  budgetary  framework. However, the action  plan was not extended to cover 2022. The 
adoption of amendments to the Law on budget and fiscal responsibility  to consolidate these 
reforms,  including  the  establishment  of  a  fiscal  council,  is  still  pending.  The  state  budget 

16 

 
 
electronic system was considerably improved but challenges remain over the inclusion of all 
public institutions in the centralised salary system and with regard to interoperability of the 
different IT systems in place.  

A  new  2022-2026  PFM  reform  programme  and  action  plan  for  2022-2024  are  yet  to  be 
adopted.  Activities  are  expected  to  focus  on  management  of  public  investments,  debt  and 
fiscal  risks,  notably  on  reform  of  state-owned  enterprises,  and  on  commitment  and  assets 
management  and  accrual  accounting.  Reforms  in  these  areas  will  also  contribute  to 
implementation  of  several  national  development  strategies  and  the  economic  reform 
programme. Further fine-tuning of programme-based budgeting, performance budgeting and 
internal control systems, as well as increased alignment between strategic planning and mid-
term budgetary framework, have the potential to bring about deep modernisation of the public 
finance management system in the next few years. Public finance management at local level 
should be included in the new PFM reform programme. 

As  concerns  digitalisation  in  the  PFM  area,  the  interoperability  of  various  IT  systems 
remains  an  issue.  Some  efforts  took  place  to  improve  budget  planning  and  the  central 
calculation  of  salaries  but  the  interlinkage  of  other  systems,  especially  the  treasury  system, 
still needs to be completed or established. This is delaying significant progress on PFM, on 
issues  such  as  the  introduction  of  accrual  accounting,  and  the  full  development  of 
performance budgeting.   

improvements 

transparency,  continuous 

On  budget 
to  programme-based  budget 
classification, with programme goals and performance indicators, have contributed to better 
clarifying the link between high-level  strategic and policy objectives and annual  and multi-
annual budgets. However, weaknesses in monitoring and reporting still limit the analysis on 
effectiveness of spending and efficient service delivery. A citizens’ budget and new templates 
for  in-year  and  annual  budget  execution  reports,  including  non-financial  and  performance 
information, are yet to be adopted and implemented. 

Public service and human resources management 

The Human Resource Management Authority  continues to  proactively manage civil  service 
training in horizontal areas, but a training needs analysis is yet to be carried out. On human 
resource management, improvements were made to registers on the number of employees at 
the central level. 

Amendments  to  the  Law  on  civil  servants  and  state  employees  adopted  in  2021  lowered 
qualification  requirements  for  the  recruitment  of  civil  servants,  affecting  merit-based 
recruitments,  and  the  competence  and  independence  of  the  public  service.  The  criteria  for 
dismissals  were  not  transparently  applied.  This  continued  to  affect  the  pace  of  public 
administration reform during the reporting period.   

Accountability of administration 

Amendments to the Law on access to information are still to be adopted by Parliament, the 
aim  being  to  increase  transparency  in  the  work  of  public  bodies  and  to  grant  Montenegrin 
citizens easier access to information. Implementing legislation on the reimbursement of costs 
in  the  access  to  information  process  was  adopted  in  October  2021.  In  December  2021, 
Parliament  dismissed  two  members  of  the  Council  of  the  Agency  for  Personal  Data 
Protection and Free Access to Information, acting as an executive board of the agency. This 
has  effectively  incapacitated  the  decision-making  of  the  agency,  including  the  review  of 
appeals against decisions of first-instance authorities on requests for public information. 

17 

 
 
As  concerns  lines  of  accountability,  the  legislative  framework  for  the  supervision  of  the 
work  of  state  administration  bodies  is  in  place,  with  the  lines  of  responsibility  of  the 
ministries  as  well  as  their  respective  bodies  defined.  However,  the  functioning  of  this 
framework  is  yet  to  be  improved,  ensuring  that  the  reports  and  annual  plans  of  the 
subordinate  authorities  submitted  for  formal  approval  to  the  relevant  ministry  are  result-
oriented, with objectives, targets and measurable indicators.   

The organisational  set-up of the state administration  has  not  been fully  aligned with the 
Law on state administration. Reorganisations of the state administration conducted during the 
reporting  period  were  made  without  sufficient  ex-ante  analysis  or  strategic  approach. 
However, in May 2022, Parliament adopted amendments to the Law on state administration, 
limiting the number of state secretary posts in the public administration. This has resulted in 
fewer political appointments in the public administration.  

Service delivery to citizens and businesses 

Overall, while Montenegro has made some improvements in the area of digitalising services, 
the progress in public service delivery remained slow. There was a lack of clear ownership 
and leadership for the development of public services in general. Administrative procedures 
remained bureaucratic and complicated, and there was no evidence of work on harmonising 
implementing  legislation  with  the  Law  on  administrative  procedures  during  the  reporting 
period.  

In  December  2021,  the  government  adopted  the  2022-2026  strategy  for  the  digital 
transformation,  with  two  main  objectives:  improving  capacity  for  digital  transformation, 
and  strengthening  digital  awareness  of  Montenegrin  society  and  digital  competitiveness  of 
the information and communication technology sector. December 2021 also saw the adoption 
of  Montenegro’s  2022-2026  cyber  security  strategy.  The  strategy  envisages  activities  to 
improve cyber-security in the country and establish a centre for cyber security. 

The  programme  for  attracting  ‘digital  nomads’,  adopted  by  the  government  in  December 
2021, aims to make Montenegro a globally attractive destination for digital experts. The Law 
on  electronic  documents  is  yet  to  be  adopted.  The  purpose  of  this  law  is  to  contribute  to 
accelerating digital transformation and to encourage the use of electronic documents, digital 
signatures  and  electronic  seals  in  public  administration  and  economy.  The  law  is  also 
expected to bring savings on administration and more streamlined procedures. 

To achieve  efficiency in work, reduce the use of paper in  public administration and  reduce 
the  costs,  the  ’paperless  administration’  project  was  piloted  in  the  Ministry  of  Public 
Administration, the Human Resources Management Authority and the Ministry of Justice and 
Human  and  Minority  Rights.  All  document  exchanges  between  these  institutions  are  now 
done electronically. 

During  the  reporting  period,  the  Code  for  Montenegro  was  drawn  up  as  a  platform 
volunteering  to  solve  citizens’  problems  and  challenges.  The  idea  of  the  platform  is  to 
transfer  good  practices  in  the  area  of  digital  transformation  from  private  industry,  civil 
society and academia to public administration.  

2.2. RULE OF LAW AND FUNDAMENTAL RIGHTS 

2.2.1  Chapter 23: Judiciary and fundamental rights 

The EU’s founding values include the rule of law and respect for human rights. An effective 
(independent, high quality and efficient) judicial system and effective fight against corruption 
are of paramount importance, as is respect for fundamental rights in law and in practice. 

18 

 
 
Montenegro remains moderately prepared to apply the EU acquis and the European standards 
in this area and has made limited progress overall. Limited progress was made in the area of the 
judiciary,  with  no  progress  on  the  implementation  of  key  judicial  reforms  and  a  limited  track 
record on judicial accountability.  

Corruption and high-level corruption remain issues of concern and are prevalent in many areas. 
Some  progress  has  been  made  in  the  prevention  of  corruption,  but  progress  was  limited  in  the 
repression of corruption. Further efforts are needed to establish a credible and effective criminal 
justice  response.  A  new  strategic  framework  is  needed,  which  should  foster  an  integrated 
approach, focusing on the prevention and repression of corruption.  

On  fundamental  rights,  Montenegro  continued  meeting  obligations  from  international  human 
rights  instruments  and  legislation;  however,  challenges  remain  in  ensuring  the  effective 
implementation  of  national  legislation,  in  particular  for  the  most  vulnerable  groups.  While 
Montenegro benefits from a pluralistic media environment, progress was limited on freedom 
of expression and media freedom. Full and effective protection of journalists and other media 
workers and further alignment of the media policy and legal framework with the EU acquis 
remain to be ensured.  

Functioning of the judiciary 

Montenegro’s  judicial  system  is  moderately  prepared,  with  limited  progress  overall.  The 
implementation of key judicial reforms remains  stalled. Certain long-pending high-level judicial 
appointments took place, bringing more stability to the justice system, but several others are still 
pending, including at the Constitutional Court, which require a qualified majority in Parliament; 
this  process  must  ensure  the  merit-based  appointment  of  individuals  able  to  act  independently, 
impartially  and  with  integrity.  Concerns  remain  over  the  institutional  performance  and 
consolidation  of  independent  Judicial  and  Prosecutorial  Councils.  The  track  record  on  judicial 
integrity,  accountability  and 
accountability 
professionalism of the judiciary need to be further strengthened, including by implementing the 
relevant  constitutional  and  legal  framework  and  by  adopting  legislative  changes  in  line  with 
European  standards.  The  efficiency  of  the  judiciary  also  needs  to  be  strengthened.  The  human, 
financial,  ICT  and  infrastructure  management  systems  must  be  substantially  improved.  The 
adoption of a new strategy for the rationalisation of the judicial network is still pending, as is the 
implementation of the ICT strategy for the judiciary. Montenegro continues to make progress on 
the domestic handling of war crimes, with good judicial cooperation with neighbouring countries 
and with the International Residual Mechanism for Criminal Tribunals (IRMCT).  

limited.  Effective 

independence, 

remains 

Last  year’s  recommendations  have  not  been  met  and  remain  largely  valid.  Therefore,  in  the 
coming year, Montenegro should in particular:  

  ensure the consolidation of merit-based key judicial appointments of individuals able to act 
independently,  impartially  and  with  integrity.  This  includes  the  members  of  the  Judicial 
Council, the Supreme State Prosecutor, and judges at the Constitutional Court;  

  avoid reversing earlier achievements, ensure the effective independence and professionalism 
of  the  judiciary  by  addressing  in  substance  all  the  outstanding  recommendations  of  the 
Venice  Commission  and  the  Council  of  Europe  Group  of  States  against  Corruption 
(GRECO),  and  by  fully  and  unambiguously  implementing  the  relevant  constitutional  and 
legal framework;  

  ensure  the  independence,  accountability,  integrity  and  impartiality  of  the  justice  system  by 
improving  the  institutional  performance  and  operational  capacity  of  the  Judicial  and 
Prosecutorial  Councils  and  by  reviewing  and  effectively  implementing  the  disciplinary  and 
ethical framework for judges and prosecutors to strengthen its objectivity, proportionality and 
effectiveness;  

19 

 
 
  improve the efficiency of the judiciary by adopting and implementing a new strategy for the 
rationalisation of the judicial network, and by starting to implement the ICT strategy for the 
judiciary. 

Strategic documents 

The implementation of the 2019-2022 strategy for the reform of the judiciary is ongoing and 
a Council was set up to monitor this in November 2021. The 2021-2022 action plan for the 
implementation  of  the  strategy  was  adopted  in  December  2021  and  a  mechanism  for 
monitoring  its  implementation  is  in  place.  The  Ministry  of  Justice  is  yet  to  demonstrate 
unreserved  commitment  to  full  and  timely  implementation  of  all  segments  in  the  judicial 
reforms.  

Management bodies 

The Judicial and Prosecutorial Councils are the principal bodies managing the judicial system 
and the careers of judges and prosecutors. Their composition and appointment procedures are 
broadly  in  line  with  European  standards.  However,  outstanding  issues  with  regard  to  the 
functioning  of  both  councils  remain  an  issue  of  concern,  namely  due  to  their  incomplete 
composition.  The  Judicial  Council’s  independence  from  undue  political  influence,  for 
instance  due  to  the  ex  officio  participation  of  the  Minister  of  Justice,  as  identified  by  the 
GRECO, is yet to be strengthened.  

Moreover,  the  Venice  Commission’s  recommendations  in  its  2021  Opinion  on  the  revised 
amendments to the Law on the State Prosecution Service concerning risks of politicisation of 
the  Prosecutorial  Council  have  not  been  addressed  in  full.  since  they  entered  into  force  in 
June 2021. New lay members continue to  be voted in  by simple majority  in  Parliament, an 
issue  on  which  the  Venice  Commission  already  provided  recommendations  in  2014  and 
2015,  and  which  remains  to  be  addressed  in  order  to  mitigate  the  risks  of  undue  political 
influence over the Council.  

It  is  essential  that  Montenegro  address  these  issues  in  order  to  avoid  reversing  its  earlier 
achievements on justice reform. Additional guarantees need to be put in place to mitigate the 
risks and perception of undue political influence over the Judicial and Prosecutorial Councils. 

In June 2022, the General Conference of Judges elected four judges  as new members of the 
Judicial  Council.  These  took  office  in  August  after  the  term  of  office  of  the  Council’s 
previous judicial members expired. However, the Judicial Council’s long-lasting functioning 
in an incomplete composition has been undermining its ability to take decisions that require a 
two  thirds  majority,  such  as  the  appointment  of  the  Supreme  Court  President,  and  causes 
frequent  delays  in  the  exercise  of  some  important  powers,  with  a  negative  impact  on  the 
overall functioning of the justice system. This means that instead of 10 members, the Council 
currently has three lay members, four judges and the acting President of the Supreme Court. 
Due  to  the  inability  to  secure  a  qualified  majority  in  Parliament  for  the  election  of  the 
Council’s lay members, a temporary anti-deadlock mechanism introduced in 2018 continues 
to be applied and the term of office of three lay members has been extended several times and 
are currently in their ninth year in office,  while the Constitution limits the term of office to 
four. In August 2022, the Parliament failed to replace the lay members in the first round of 
voting following a selection procedure that started in May 2022 even though up to 35 eligible 
candidates applied. In September the Parliament appointed one of the required lay members. 
In January 2022, the Prime Minister took on the role of acting Minister of Justice, Human and 
Minority Rights,  but  did not  participate in  the work of the Judicial  Council as an ex officio 
member in this capacity. 

20 

 
 
Following the proclamation of the new Prosecutorial Council in August 2021, the Council did 
not hold any session until early 2022 due to its incomplete composition. In December 2021, 
Parliament  appointed  five  members  from  the  ranks  of  eminent  lawyers,  including  one 
representative  of  non-governmental  organisations  (NGOs).  This  allowed  the  Council  to 
restart  its  functioning.  In  February  2022,  it  unanimously  appointed  a  new  acting  Supreme 
State Prosecutor from the ranks of prosecutors, as recommended by the Venice Commission 
in  its  2021  opinion.  However,  the  appointment  of  a  permanent  Supreme  State  Prosecutor, 
requiring a qualified majority in Parliament, is pending since October 2019.  

In  February  2022,  the  Prosecutorial  Council  terminated  the  mandate  of  the  former  Chief 
Special  Prosecutor  and  nine  other  prosecutors  due  to  their  meeting  the  conditions  for 
retirement.  In  March  2022,  the  Council  appointed  a  new  Chief  Special  Prosecutor  with  a 
large  majority  (10  votes  in  favour  and  1  against).  At  the  request  of  the  new  Chief  Special 
Prosecutor,  in  June  2022  the  Prosecutorial  Council  reassigned  three  additional  state 
prosecutors to the Special State Prosecutor’s Office.  

Following organisational changes, the Prosecutorial Council has yet to consolidate its regular 
work and practice.  

The operational capacity of both councils’ secretariats continues to improve but needs to be 
strengthened  further.  The  2022  budget  of  the  Judicial  Council  was  increased  by  51.6% 
compared to the previous year, mainly due to the planned procurement of software. The lack 
of adequate spatial/working conditions for the Judicial Council and its Secretariat remains a 
long-term  concern.  The  2022  budget  of  the  Prosecutorial  Council  was  reduced  by  15% 
compared  to  the  previous  year.  The  administrative  capacities  of  both  the  Judicial  and  the 
Prosecutorial Councils have still to be improved. These include strategic, budget and human 
resources  planning  and  management,  and  public  communication.  The  2022  Law  on  the 
budget established for the first time a system of distribution of financial resources by courts 
and prosecution offices individually. Results-based financial management in the judiciary is 
being  gradually  introduced  across  the  board,  with  initial  steps  undertaken  in  2020  and  a 
number of internal  financial procedures/regulations  revised and  codified in 2021. However, 
although key performance indicators in courts and prosecution offices, and methodology for 
performance-based  financial  management,  are  being  piloted  at  basic  court  level,  the 
methodology and tools for performance-based financial management and control are yet to be 
established. Overall, resource levels do not match judicial performance targets.  

The  transparency  of  both  councils  continues  to  improve.  The  sessions  of  both  councils  are 
open to the interested public (media, NGOs). The transparency of the councils’ work needs to 
be further enhanced by publishing fully reasoned decisions on promotions, appointments and 
disciplinary  cases.    Members  of  both  councils  should  devote  more  time  and  show  full 
commitment to performing their functions. The Prosecutorial Council needs to demonstrate a 
more proactive approach to addressing issues within the public prosecution service, including 
with respect to the professional performance of the heads of state prosecution offices and of 
state prosecutors themselves, including their accountability and professionalism.  

Further  efforts  are  needed  to  effectively  consolidate  strong  and  independent  Judicial  and 
Prosecutorial Councils, to substantially improve the functioning of the entire judicial system 
and restore trust in it. 

Independence and impartiality 

Following  the  2013  amendments  to  Montenegro’s  Constitution,  judicial  independence  was 
strengthened by increasing the safeguards against the risks of undue political influence over 
appointments.  Overall,  the  legal  framework  guaranteeing  judicial  independence  is  in  place, 

21 

 
 
but  the  judiciary  and  the  prosecution  service  continue  to  be  perceived  as  vulnerable  to 
political interference, including due to some deficiencies that still need to be addressed in the 
relevant  legislation.  In  this  regard,  a  firmer  commitment  is  needed  to  ensure  the  full  and 
effective  independence,  integrity,  and  impartiality  of  Montenegro’s  justice  system.  This 
includes  fully  and  unambiguously  implementing  the  relevant  constitutional  and  legal 
framework  and  amending  it  as  relevant  in  line  with  European  standards.  Political  leaders 
should  refrain  from  statements  that  undermine  the  independence  of  the  judiciary  and  the 
autonomy of the state prosecution service.  

The  underlying  constitutional  and  legal  framework  limits  the  appointments  of  court 
presidents to maximum two terms in order to prevent over-concentration of power. However, 
three basic court presidents re-appointed for at least a third term of office between 2019 and 
2020 are still in office. Four public calls for the election of a new President of the Supreme 
Court were unsuccessful.  Following the retirement  of the Deputy President  of the Supreme 
Court in August 2021, the Council appointed the acting President of the Supreme Court to the 
position of member of the Judicial Council in September 2021.  In March 2022, the Judicial 
Council  elected  11  judges  to  the  Supreme  Court.  With  these  appointments,  the  quorum  for 
holding  the  Supreme  Court’s  General  Assembly  was  met,  so  the  Court  can  now  propose  a 
candidate  for  President  of  the  Supreme  Court.  The  Judicial  Council  has  yet  to  appoint  the 
new President of the Administrative Court; the position has been vacant for more than twelve 
months.  

The head of the basic state prosecution office in Podgorica was appointed in May 2022.  

The  random  allocation  of  cases  is  provided  for  by  the  Law  on  courts  and  implemented 
automatically through the judicial information system (JIS). However, limitations  remain in 
very  small  courts,  and  the  system  has  not  been  introduced  in  the  misdemeanour  courts.  In 
2021,  a  significantly  smaller  number  of  cases  (114)  was  delegated  among  the  courts, 
including 86 cases delegated at the level of basic courts and 28 cases delegated between the 
two high courts. Although establishing clear criteria for reallocation of cases is still needed, 
this reduction is an improvement in the practice of reallocation of cases between courts, and 
one which ensures the right to a lawful judge.  

The Constitutional  Court continues to  operate in  an incomplete composition.  Following the 
resignation of one of its members in  January 2022, the Court operated  with  four instead of 
seven  judges,  which  in  practice  meant  that  unanimity  was  required  for  the  Court  to  take 
decisions,  undermining its  ability to  function, its performance and  efficiency.  In July 2022, 
the  procedure  for  appointing  new  judges  failed  in  Parliament,  due  to  a  lack  of  political 
agreement on the seventeen candidates. The Parliament then published a new call to fill the 
four  positions  and  the  procedure  is  ongoing.  Furthermore,  one  judge  retired  in  September 
2022, so  the Court currently counts with  only three members. Therefore,  the Constitutional 
Court lacks the required quorum to take decisions and is unable to operate.  

Accountability 

The  revision  of  the  Law  on  the  Judicial  Council  and  judges  is  ongoing.  The  revision  will 
address  notably  the  disciplinary  and  ethical  liability  of  judges  and  the  criteria  for  the 
appointment, promotion and professional evaluation of judges. 

In  April  2022,  one  basic  prosecutor  was  arrested  and  detained  on  suspicion  of  abuse  of 
official  position.  In  May  2022,  the  President  of  the  Commercial  Court  of  Montenegro  was 
arrested  and  detained  on  suspicion  of  organising  a  criminal  group,  corruption  and 
embezzlement.  Following  the  arrest,  the  President  was  temporarily  removed  from  office, 

22 

 
 
pending  completion  of  the  investigation  and  the  decision  on  prosecution.  The  Judicial 
Council then appointed an acting President.  

The promotion and enforcement of codes of ethics and disciplinary accountability standards 
and procedures for judges and prosecutors remain limited. There is a limited track record and 
a  lack  of  commitment  from  both  the  Judicial  and  Prosecutorial  Councils  to  ensuring 
accountability.  The  legal  framework  for  disciplinary  issues  and  ethics  for  judges  is  being 
reviewed. Further improvements and effective enforcement of the judicial inspection system 
are needed, including more thorough and unannounced inspections.  

The  system  for  detecting  breaches  of  integrity  rules  needs  to  be  made  more  effective, 
objective,  consistent  and  credible.  There  is  also  a  need  to  ensure  the  follow-up  of  all  cases 
that give grounds for disciplinary or ethical responsibility. A legal remedy against decisions 
of the ethical commissions of both councils has yet to be introduced by the relevant law. The 
decisions of the Prosecutorial and Judicial Councils remain insufficiently motivated and case-
law is yet to be developed.  

The  Ethical  Commission  of  the  Judicial  Council  did  not  perform  its  duties  for  7  months 
(August 2021 – March 2022) due to its incomplete composition. In March 2022, the General 
session of the Supreme Court appointed one of its members to the Ethical Commission of the 
Judicial  Council, creating  conditions  for the Commission  to  resume its work.  In 2021, four 
disciplinary  proceedings  were 
the  Judicial  Council’s  Disciplinary 
Commission,  while  no  violations  of  the  Code  of  Ethics  for  judges  were  found  in  2021. 
Overall, in 2021 the Commission issued nine decisions and two opinions. During the first half 
of  2022,  26  disciplinary  proceedings  were  initiated  against  judges  due  to  failure  to  submit 
their declarations of assets  and income to  Agency  for the Prevention of  Corruption. So far, 
five have been rejected as unfounded. In 2022, one violation of the Code of Ethics for Judges 
was found by the Ethical Commission of the Judicial Council. The Law does not provide for 
any legal remedy against the Commission’s decisions. In June 2022, the Ethical Commission 
adopted the guidelines on the freedom of expression of judges. 

launched  before 

The Ethical Commission of the Prosecutorial Council has not performed its duties since the 
appointment of the new composition of the Prosecutorial Council in August 2021. In 2022, 6 
initiatives were pending before the Ethical Commission of the Prosecutorial Council. In two 
cases,  the  Commission  found  violations  of  the  Code  of  Ethics  for  state  prosecutors,  while 
three  initiatives  were  considered  unfounded.  Furthermore,  in  2021  two  disciplinary 
proceedings were brought before the Prosecutorial Council’s Disciplinary Commission, while 
in 2022, disciplinary proceedings were initiated against one state prosecutor. In one case, the 
Commission  found  a  violation  of  disciplinary  rules  and  imposed  a  sanction  consisting  in  a 
20% salary decrease for 3 months.  

The  approach  of  the  Ethical  Commissions  of  the  Judicial  and  Prosecutorial  Councils  to 
handling cases is still not sufficiently effective and consistent.  

In  2021  and  2022,  judicial  inspectors  from  the  Ministry  of  Justice,  Human  and  Minority 
Rights  performed  supervision  of  the  work  in  21  courts,  nine  state  prosecution  offices,  53 
notaries  and  28  public  bailiffs.  No  irregularities  were  found  during  the  supervision  of  the 
courts  in  2021.  In  2022,  irregularities  were  observed  in  two  basic  courts.  No  irregularities 
were found during the supervision of the prosecutor’s offices. Judicial inspectors conducted 
43  inspections  of  the  work  of  public  notaries  and  found  three  irregularities  during  the 
supervision.  Two  new  inspectors  were  hired  in  January  2022;  however,  the  Ministry’s 
capacity in this area still requires significant strengthening. The law on systematisation of the 
Ministry plans to increase the number of judicial inspectors to five. 

23 

 
 
There were no significant results on the accountability of independent legal professions. The 
new Code of Ethics for Lawyers has not yet been adopted. In August 2021, the new Code of 
Ethics  of  the  Association  of  Court  Experts  was  adopted.  Implementation  of  the  codes  of 
ethics  of  notaries,  bailiffs  and  court  interpreters  remained  limited  and  needs  to  be  further 
enhanced.  The  self-regulatory  roles  of  the  chambers  and  professional  associations  of  legal 
professions must also be enhanced further. 

Professionalism and competence 

Montenegro continues to organise single nationwide competitions for judges and prosecutors. 
The  2020-2022  plan  for  vacant  judicial  positions  was  amended  several  times  during  2021, 
given the large number of resignations and retirements.  In the reporting period, the Judicial 
Council  elected  four  court  presidents,  nine  judges  of  the  High  Court,  eight  judges  of  basic 
courts,  seven  judges  of  misdemeanour  courts,  and  51  candidates  for  judges,  while  the 
procedures for appointing several court presidents and more judges are ongoing. In 2021, one 
judge  was  voluntarily  reassigned.  The  procedure  for  appointing  the  Administrative  Court 
president has been ongoing for more than 8 months.  

In 2021, the Prosecutorial Council elected two prosecutors to the Supreme State Prosecution 
Office, nine heads of prosecution offices, five prosecutors to High State Prosecution Offices 
and  two  prosecutors  to  the  Basic  State  Prosecution  Offices.  In  July  2021,  the  Prosecutorial 
Council  appointed  three  special  prosecutors,  while  one  state  prosecutor  was  voluntarily 
assigned on a permanent basis to the Basic State Prosecutor’s Office in Podgorica.  

Implementation of the system of regular professional evaluation of judges and prosecutors is 
affected by both council’s inactivity. In 2021, no judges and only one state prosecutor were 
evaluated using the regular assessment scheme. During the reporting period, the evaluation of 
101 judges as part of the promotion procedure was completed. In 2021, four prosecutors were 
evaluated under the promotion procedure.  

The interpretation of legal conditions for the retirement of judges and prosecutors is disputed 
after the 2020 Law on pensions insurance lowered the general age requirement for the right to 
a pension for public officials, deviating from provisions in the general body of labour law. In 
August  2021,  the  Judicial  Council  declared  the  termination  of  the  judicial  function  of  23 
judges,  based  on  their  having  met  the  conditions  for  retirement.  Of  these  23  judges,  11 
initiated  proceedings  before  the  Constitutional  and  Administrative  Courts,  challenging  the 
decision  of  the  Judicial  Council.  Proceedings  before  the  Constitutional  and  Administrative 
courts are ongoing. In February 2022, the Prosecutorial Council declared the termination of 
the prosecutorial function for 10 state prosecutors, based on their having met the conditions 
for retirement.  

Quality of justice 

The  budget  for  the  judiciary  for  2022  is  EUR  37.3  million  (2021:  EUR  36.5  million)  and 
remains above the regional per capita average. Montenegro had 268 full-time judges (43 per 
100,000  inhabitants)  and  111  full-time  prosecutors  (18  per  100,000  inhabitants)  in  2021.  
According to the European Commission for the Efficiency of Justice (CEPEJ), the European 
averages are 21 judges/12 prosecutors per 100,000 inhabitants. has 50 judges (60% of whom 
are women) and 19 prosecutors (over 62% of whom are women) per 100 000 inhabitants, far 
above  the  European  average  of  17  judges  and  11  prosecutors.  Collection  of  court  fees 
remains much lower compared to the region. 

The  allocated  budget  for  the  work  of  the  Centre  for  Training  in  Judiciary  and  State 
Prosecution  Service  for  2022  amounts  to  EUR  437  754,  which  is  below  the  legally 
established threshold. While the Centre continued to be financially supported by the EU and 

24 

 
 
other  international  donors,  its  autonomous  and  self-sustainable  functioning  will  need  to  be 
ensured.  There  is  continued  improvement  in  the  overall  functioning  of  the  Centre  and  its 
staffing  levels.  However,  its  administrative,  managerial,  strategic  planning,  communication 
and financial management capacities are still to be improved. At the beginning of 2021, there 
were  16  employees  in  the  Centre,  whereas  at  the  end  the  reporting  period,  there  were  12 
employees instead of the 19 posts officially allocated to the Centre.  

In 2021, the former judicial training programming was replaced by a comprehensive training 
needs  assessment  (TNA)  conducted  by  the  Judicial  Training  Centre,  following  which  a 
general  annual  training  programme  for  2022  was  developed.  Efforts  are  needed  to  involve 
more judges and prosecutors in  the TNA process  and further improve training delivery and 
evaluation practices. TNA should take into consideration the multidisciplinary and practical 
nature of judicial training, essentially intended to transmit professional techniques and values 
complementary to legal education. The Centre must develop capacity to conduct assessment 
on training needs in connection with meeting rule of law standards and implementing the EU 
acquis,  and  to  design  and  implement  corresponding  training  activities.  The  total  budget 
allocated  to  training  initiatives  at  the  training  centres  and  to  other  initiatives  implemented 
directly by courts and prosecution offices in 2021 amounted to EUR 422 455, a 46% decrease 
on the previous year. 

The  results  of  the  2021  Report  on  European  Judicial  training  showed  that  in  2020 
Montenegro had the highest percentage of judges participating in continuous training in EU 
law among all candidate countries and potential candidates, at nearly 20%. It is important to 
establish  regular  cooperation  and  more  frequent  communication  between  the  Judicial 
Training  Centre  and  the  Judicial  and  Prosecutorial  Councils.  The  organisation  of  meetings 
between  the  representatives  of  these  institutions  in  December  2021  is  a  step  in  the  right 
direction.  

The positive trend in alternative dispute resolution (ADR) continued. The implementation 
of the new law, which provides for the compulsory recourse of this mechanism to the types of 
cases that are suitable for ADR, started in August 2020. In 2021, the ADR system continued 
to expand, with 1 315 settlements reached (2020: 1 269). In 2021, there were 6 106 mediation 
proposals preceding judicial litigation (2020: 1 540). However, the judicial system is not yet 
prepared  to  accommodate  the  increased  use  of  ADR,  since  the  implementation  of  the  new 
ADR  legislation  is  still  not  effective  or  being  applied  consistently  in  the  competent  courts. 
Further  reforms  should  focus  on  strengthening  the  Centre’s  supervision,  enhancing  judges’ 
and mediators’ powers, and increasing the scope and quality of ADR services, especially in 
commercial cases. 

Efficiency 

In 2021, 118 568 cases (2020: 139 560) were pending before Montenegrin courts, 84 143 of 
which were new cases (2020: 80 723). Some 80,485 cases were resolved (2020: 83 206), and 
at the end of 2021 there was 37 963 cases pending. The number of cases older than 3 years 
was 3 794 at the end of 2021 (2020: 3 036). The disposition time, i.e. the average time from 
filing to decision, was 158 days in basic court cases (2020: 150), 197 for commercial cases 
(2020: 148) and 538 days before the Administrative Court (2020: 438).  

As  regards  enforcement,  the  backlog  of  pending  enforcement  cases  before  the  courts 
decreased.  Some  760  cases  were  pending  at  the  end  of  2021  (150  000  in  2016).  Since  the 
introduction of the bailiff system in 2016, enforcement cases before the courts have gradually 
reduced. In 2021, 76 779 cases were filed with bailiffs’ offices (2020: 66 085), with 47 217 
cases pending at the end of the year (2020: 43 569). The centralised case management system 

25 

 
 
for bailiffs continues to be used consistently, guaranteeing data reliability. The enforcement 
of  court  decisions  remains  a  challenge,  due  to  the  lack  of  effective  follow-up  by  judicial 
authorities.  

In 2021, the Constitutional Court received 1 344 new cases and resolved 1 498 pending cases. 
The  current  backlog  is  some  3  212  cases;  2  967  (around  92%)  of  those  are  pending 
constitutional  complaints  on  human  rights  violations.  Furthermore,  there  are  123  laws  and 
127 pieces of implementing legislation adopted by Parliament pending constitutional review. 
Concrete  steps  need  to  be  taken  to  ensure  adequate  operational  capacity  necessary  for  the 
efficient functioning of the Court and to reduce the backlog of cases. Currently, 4 judges and 
34 employees form the workforce of the court’s professional service– this is around 60% of 
the officially allocated posts. 

There  were  no  developments  on  implementing  recommendations  from  the  analysis  on 
rationalisation of the court network adopted by the government in October 2020. The analysis 
should  serve  as  a  basis  for  preparing  a  new  strategy  in  this  area.  Drawing  on  the  available 
data,  conclusions  from  studies  and  cost-benefit  analyses,  reform  in  this  area  should  aim  to 
ensure better overall management of human resources and judicial infrastructure, ultimately 
leading to optimisation of the court network and the closing of small unviable courts. 

Full  implementation  of  instructions  for  collecting  statistical  data  in  compliance  with  the 
guidelines  of  the  European  Commission  for  the  Efficiency  of  Justice  (CEPEJ)  remains  a 
challenge. Issues also remained regarding the reliability and availability of statistical data for 
the judiciary in the absence of an advanced case management system. Data on the total length 
of proceedings is still not available. Statistical information on the performance of the judicial 
system is not systematically analysed or used for management and policy-making purposes.  

The implementation of the ICT strategy and the 2021-2023 justice development programme 
are pending.  

The efficiency of the justice system is hampered by the lack of effective systems for human 
resources and staffing, financial resources,  ICT and infrastructure management. There is  an 
urgent  need  for  strategic  investments  in  infrastructure.  The  allocated  working  space  and 
working  conditions  in  general  at  all  levels  of  the  judiciary  are  well  below  the  minimum 
required  European  standards.  There  is  an  insufficient  number  of  specialised  judges  and 
prosecutors  and  a  lack  of  expertise  in  certain  areas.  Adequate  ICT  infrastructure  and 
equipment in the judiciary is lacking. More efforts are needed to ensure the effective financial 
independence of the judicial system.  

Domestic handling of war crimes cases  

Montenegro continued to implement its war crime prosecution strategy, with limited results. 
In 2021, the Special Prosecutor’s Office conducted preliminary investigations in seven cases 
concerning war crimes committed on the territories of Bosnia and Herzegovina and Croatia. 
In  one  case,  relating  to  a  request  from  Bosnia  and  Herzegovina  for  mutual  legal  assistance 
concerning  one  person,  the  authorities  found  that  there  was  reasonable  suspicion  of  the 
criminal offence. Another investigation was closed for lack of grounds for prosecution. Work 
on the remaining five cases continues.  

Montenegro continued its good cooperation with neighbouring countries. In 2021, the Special 
State Prosecutor’s Office acted upon 10 letters rogatory, and five letters rogatory from 2020. 
Good  cooperation  continued  with  the  International  Residual  Mechanism  for  Criminal 
Tribunals  (IRMCT).  In  the  context  of  a  file  submitted  by  individuals  believed  to  be 
Montenegrin nationals who are suspected of serious war crimes, one person was heard as a 
witness and exchanges continued with the prosecution services of Bosnia and Herzegovina. 

26 

 
 
Based  on  IRMCT  recommendations,  amendments  are  being  prepared  to  the  Criminal 
Procedural  Code  to  proactively  address  the  legal  and  practical  obstacles  to  effectively 
investigate, prosecute, try, and punish war crimes in line with international standards. Work 
continued on legislative changes that would allow Montenegro to effectively investigate and 
prosecute conflict-related sexual violence cases.  

In  October  2021,  the  High  Court  of  Podgorica  upheld  an  indictment  against  a  suspect;  the 
trial  is  currently  ongoing.  In  June  2022,  the  Special  Prosecutor’s  Office  submitted  another 
indictment to the High Court of Podgorica.   

During the reporting period, 30 claims for compensation were pending before the courts, all 
concerning the ‘Morinj camp’ case. Of those, 27 were fully or partially upheld, awarding the 
total non-pecuniary damages of EUR 196 876.66. The proceedings on three remaining cases 
are ongoing.  

In  October  2021,  the  Minister  of  Foreign  Affairs  attended  the  commemoration  of  the  30th 
anniversary  of  the  Morinj  camp.  This  was  the  first  time  for  Montenegrin  and  Croatian 
authorities to visit the site together. In May 2022, for the first time Montenegrin authorities 
attended the gathering in Herceg Novi marking the deportation of Bosnian refugees in 1992 
and publicly apologised to the families of deported refugees.  

Montenegro  continued  to  actively  participate  in  the  regional  Missing  Persons  group  and 
contributed  to  implementing  the  framework  plan  signed  in  November  2018.  Cooperation 
continued  with  neighbouring  countries  under  bilateral  cooperation  protocols.  The  list  of 
missing persons compiled by the Commission on Missing Persons of Montenegro maintains 
records  of  51  active  cases  who  are  Montenegrin  citizens  or  whose  families  reside  in 
Montenegro.  Montenegro’s  legislative  framework  still  does  not  include  a  specific  law  on 
missing persons.  

Fight against corruption 

Montenegro has achieved some level of preparation. Limited progress was achieved during 
the  reporting  period.  Last  year’s  recommendations  were  partially  met.  The  track  record  on 
prevention of corruption further improved, in particular due to the positive trend of the work 
and performance of the Anti-Corruption Agency (ACA). However, more needs to be done to 
ensure the Agency’s integrity, and accountability, and to improve its tangible results, in line 
with the recommendations of the peer review mission conducted in 2021.  To demonstrate a 
credible  criminal  justice  response,  Montenegro  still  must  improve  its  track  record  of 
investigations,  prosecutions  and  final  convictions  in  the  fight  against  corruption,  including 
high-level corruption. Furthermore, the legal and institutional framework must be improved 
in line with the EU acquis and European standards, including for the effective use of financial 
investigations and asset seizure and confiscation in such cases. The sectors most vulnerable to 
corruption require targeted risk assessments and dedicated action.  

In the coming year Montenegro should in particular: 

  review the legal framework and strengthen institutional capacities in the prevention  and 
repression of corruption to address the issues identified with regard to its enforcement; as 
well  as  on  financial  investigations,  and  asset  seizure  and  confiscation,  to  align  it  with 
international standards and with the EU acquis and European best practices; 

  improve  the  track  record  on  corruption,  including  high-level  corruption,  by  imposing 
effective  sanctions,  and  take  concrete  measures  to  improve  the  use  of  plea  bargain 
agreements in exceptional cases for a more transparent, credible, deterrent and consistent 
sanctioning policy and criminal justice response;  

27 

 
 
  adopt  a  new  strategic  framework,  including  to  establish  mechanisms  for  an  integrated 
approach, for the prevention and repression of corruption to ensure overall coherence and 
improve interinstitutional coordination and cooperation. 

 Institutional framework  

Overall, there is a need to effectively establish an integrated strategic approach to prevent and 
fight corruption. Interinstitutional cooperation and coordination between all bodies involved 
is paramount, as is ensuring coherence, clear definition and understanding of their mandates, 
roles,  and  responsibilities.  The  ACA’s  efforts  on  the  prevention  of  corruption  need  to  be 
complemented by a serious response on the part of law enforcement and prosecution service 
to  combating  corruption.  Independent  and  efficient  courts  are  also  key  to  ensuring  fair  and 
timely judicial oversight and control of the actions of the ACA and of prosecutors.  

Prevention of corruption  

The  Anti-Corruption  Agency  (ACA),  established  in  2016,  is  the  key  institution  for 
promoting integrity and preventing corruption in Montenegro. In implementing its activities, 
the Agency co-operates with several public bodies, including the prosecution services and the 
State Audit  Institution.  The results of the ACA’s investigations are subject  to  court review. 
The Anti-Corruption Council, appointed by the  President in  July 2019  for a  4  year term of 
office,  consists  of  five  members  and  is  responsible  for  the  decision-making  of  the  Agency 
and the appointment of its Director. 

Overall,  the  capacities  of  the  Anti-Corruption  Agency  continued  to  be  strengthened.  This 
resulted in improved performance and increased efforts to produce tangible results. The ACA 
and  its  Council  continued  to  demonstrate  consistent  proactivity  in  their  work,  including  by 
addressing the caseload from previous years, and increased their outreach activities towards 
the public, media and civil society. 

However, the recommendations of the April 2021 EU peer review mission remain to be fully 
addressed.  The  mission  focused  on  assessing  the  legislative  and  institutional  framework  on 
the  prevention  of  corruption  and  to  improve  the  capacities  of  the  Agency,  its  performance, 
working  methods  and  achieved  results,  in  particular  in  the  core  areas  of  its  mandate. 
Sustained efforts are required to meet the challenges relating to the Agency’s priority-setting, 
selective approach, and quality of its decisions.  

The  Agency’s  financial  independence  must  be  effectively  ensured.  The  Agency  currently 
employs 55 people, while the rulebook on the systematisation of the Agency foresees a total 
of 75 posts. The 2021 EU peer review mission recommended that additional human resources 
be allocated to the ACA.  

In  2021,  the  Agency  developed  the  strategic  work  plan  for  2022-2025,  setting  out  the 
priorities in the work of the Agency for the upcoming period. 

The  Agency  continued  its  communication  activities  and  worked  with  civil  society 
organisations, hosting an open day for NGOs in June 2021. The ACA also organised several 
anti-corruption  campaigns  in  12  municipalities.  Moreover,  the  Agency  conducted  anti-
corruption  training,  specifically  targeting  newly  appointed  public  officials.  In  2021,  17 
trainings  for  197  participants  were  organised.  21  anti-corruption  training  sessions  for  217 
participants were organised in the first half of 2022. 

In 2021, the National Council for the Fight against High-level Corruption, established in 
December 2020 to address systematic problems related with high-level corruption cases and 
to  increase  transparency  in  the  fight  against  corruption,  focused  on  serious  and  high-level 
cases, including tobacco smuggling in the Port of Bar. In January 2022, the Prime Minister 

28 

 
 
dismissed  the  Deputy  Prime  Minister  from  the  position  of  President  of  the  Council,  and 
consequently  three  Council  members  resigned  and  have  not  been  replaced  since.  The 
National  Council  has  not  met  since  January  2022.  There  are  multiple  overlaps  of  the 
Council’s powers with other institutions, most notably the ACA and the prosecution service, 
therefore  its  institutional  role,  relations  with  other  bodies  and  its  powers,  as  well  as 
safeguards in this respect, still need to be adequately defined.  

Law enforcement 

In  2021,  the  Special  State  Prosecutor’s  Office  for  Organised  Crime  and  High-level 
Corruption  (SPO)  reduced  its  staff  to  48  members  (2020:  54),  including  12  special 
prosecutors (2020: 16). The SPO’s capacity was boosted in June 2022 with the reassignment 
of three state prosecutors to the Office. However, further strengthening of the SPO’s human 
resources capacity, including through specialisation, is still required. Poor office conditions, 
which hamper the efficient functioning of the SPO, remain a matter of concern and must be 
addressed swiftly.   

Track record  

The track record of investigations, prosecutions, and final convictions in cases of high-level 
corruption continued to improve but needs further consolidation. 

In 2021, the Special State Prosecutor’s Office opened investigations into  criminal offences 
of high-level corruption in 15 cases against 70 individuals and 19 legal entities (2020: eight 
cases against 35 individuals and eight legal entities). Three indictments were lodged with the 
Higher Court of Podgorica against nine individuals, and 11 indictments against 68 individuals 
and 21 legal entities. Financial investigations have been launched in seven cases against 40 
individuals  and  six  legal  entities  (2020:  four  cases  against  30  individuals  and  two  legal 
entities).  

In 2021, 21 plea bargain agreements were concluded in four cases against 21 individuals and 
nine legal entities; of these, 16 agreements were adopted by the court ruling, one agreement 
was rejected, and four agreements are pending the Court’s ruling. In 2021, the High Court of 
Podgorica  issued  three  final  and  enforceable  judgements,  resulting  in  a  suspended  sentence 
and imprisonment served in residential premises. 

The Special Prosecutor’s Office has launched investigations of two high-level corruption and 
organised crime cases; these investigations have led to arrests. On 17 April 2022, the former 
President of the Supreme Court was arrested on charges of suspicion of abuse of office and of 
creating  a  criminal  organisation;  the  suspect  remains  in  detention.  On  10  May  2022,  the 
President  of  the  Commercial  Court  was  arrested  on  suspicion  of  forming  an  organised 
criminal  organisation,  embezzlement,  and  abuse  of  office;  he  also  remains  in  detention.  In 
December 2020, Montenegro sent  a new request  to  Serbia for the extradition  of the former 
President  of  the  State  Union  of  Serbia  and  Montenegro,  after  the  reply  to  its  request  from 
April 2019 had not been answered. 

The  legal  approach  to  and  track  record  on  financial  investigations  and  confiscation  of 
assets  for  criminal  offences  in  the  field  of  high-level  corruption  needs  to  be  substantially 
improved. In 2021, assets were temporarily frozen in three cases. There  was initial progress 
in the use of extended confiscation in corruption cases, with a final confiscation in one case, 
and better understanding of the importance of launching parallel financial investigations.  

The  need  for  a  more  deterrent  and  consistent  policy  of  sanctions  to  improve  the  criminal 
justice response to corruption and high-level corruption remains to be addressed. The use of 
plea  bargain  agreements  must  be  exercised  with  extreme  care,  for  the  right  purposes  and 

29 

 
 
observing  all  necessary  safeguards.  A  legal  cost-benefit  analysis  in  the  interest  of  justice 
should  be  conducted  systematically  when  this  mechanism  is  used.  In  no  case  can  the 
sanctions go below the legal statutory minimum. To improve its effective use, guidelines for 
the specialised courts and prosecution services need to be drafted.   

The track record on the prevention of corruption continued to improve. Both the Agency 
and its Council demonstrated proactivity in their work and increased their outreach activities 
towards the public, media and civil society.  

Significant  progress  was  achieved  in  the  number  of  verified  asset  declarations  and  in  the 
Agency’s  application  of  in-depth  verification  procedures.  In  2021,  the  number  of 
administrative  and  misdemeanour  proceedings  initiated  doubled  compared  to  2020.  Despite 
the Agency’s proactive approach to investigating and penalising breaches of the Law on the 
prevention  of  corruption  in  the  area  of  asset  declarations  and  threats  to  the  public  interest, 
there  is  still  a  significant  backlog  from  previous  years,  particularly  concerning  high-profile 
cases. 

In  2021,  the  ACA  instituted  1164  proceedings  before  misdemeanour  courts,  which  is  more 
than  twice  to  the  figure  for  2020  (510  proceedings).  808  proceedings  were  completed 
(including  those  from  previous  years)  and  sanctions  were  imposed  in  88.6%  of  cases.  In 
2021,  the  Agency  issued  136  direct  misdemeanour  orders  (2020:  42).  The  total  amount  of 
fines, including direct misdemeanour orders, amounted to EUR 149 242 (2020: EUR 89 659). 
In  2021,  the  ACA  requested  seizure  of  material  gains  before  the  competent  courts  in  one 
case,  and  the  courts  approved  confiscation  in  two  cases.  In  the  first  semester  of  2022,  the 
ACA submitted 812 requests to  the  competent  courts to  initiate misdemeanour proceedings 
for violations of anti-corruption laws.  

Between  January  and  June  2022, 
misdemeanour courts, with the total amount of fines amounting to EUR 57 890. 

the  Agency 

instituted  812  proceedings  before 

In 2021, the Agency issued 186 opinions (2020: 135) on  incompatibility of functions and 
conflict of interest. Some 26 public officials (2020: 41) resigned, and two (2020: one) were 
dismissed.  Between  January  and  June  2022,  119  opinions  on  incompatibility  of  functions 
were issued; eight public officials resigned, and two were dismissed.  

In 2021, the ACA received 10 657 (2020: 8 108) income and asset declarations. Some 974 
reports  (2020:  966)  were  verified  by  the  Agency,  exceeding  its  annual  plan  by  more  than 
10%.  In  2021,  the  Agency  initiated  295  administrative  proceedings  (2020:  138)  and 
violations  of  the  law  were  found  in  160  cases  (2020:  60).  Sanctions  were  imposed  in  nine 
cases  (2020:10).  From  January  to  June  2022,  the  Agency  received  8  727  income  and  asset 
declarations and verified all reports. In the same period, some 390 administrative proceedings 
in  the  area  of  income  reporting  were  initiated,  a  significant  increase  compared  to  previous 
years, and violations of the law were found in 205 cases.   

In 2021, the Agency concluded additional checks of 20 high-level officials and continued to 
monitor the lifestyle of public officials, using publicly available data and media reports. The 
ACA also initiated procedures to examine the lifestyle of three public officials, with one case 
submitted to the prosecution services. Further work is needed to effectively address the April 
2021  EU  peer  review  recommendations  on  conflict  of  interest  and  incompatibility  of 
functions and asset declarations. 

Concerning  funding  of  political  parties  and  electoral  campaigns,  in  line  with  its 
competences the Agency oversaw all local elections held in 2021. A total of 36 irregularities 
in  the  reports  of  political  parties  were  registered.  In  2021,  out  of  141  misdemeanour 
proceedings issued by the Agency (2020: 62), 128 concerned electoral campaigns.  

30 

 
 
During 2021, the Agency processed six complaints relating to electoral campaigns. One case 
was  forwarded  to  the  prosecution  service,  which  subsequently  found  no  violations.  The 
Agency  organised  10  meetings  with  civil  society  organisations  on  monitoring,  supervision 
and control of electoral campaigns in five local elections.  

In 2021, the State Audit Institution adopted the Manual for auditors on detection of fraud 
and corruption through audit procedures and the Guidance for presentation of audit results 
to  the  general  public.  The  documents  provide  for  an  early  response  to  suspicions  of 
corruption  and  swift  exchange  of  information  with  prosecution  services,  in  line  with  the 
memorandum  on  cooperation  between  the  State  Audit  Institution  and  Supreme  State 
Prosecutor  signed  in  2018.  The  State  Audit  Institution  published  positive  audit  reports  on 
annual financial statements from 2020 for 3 political entities, whilst regularity audits resulted 
in  5  positive,  4  negative  and  2  conditional  reports.  In  2021,  the  State  Audit  Institution 
published  one  conditional  report  on  annual  financial  statement  and  one  negative  regularity 
audit report for 1 political party. Based on previous data, the monitoring of political parties’ 
financing by the ACA and the State Audit Institution produced limited results. 

In 2021, the ACA received five requests for whistle-blower protection (three in 2020) and 
finalised  five  previous  requests,  awarding  damages  to  whistle-blowers  in  three  cases.  The 
Agency received 142 reports on the threat to public interest (2020: 75), 28.2% of them were 
submitted  anonymously,  with  39  reports  processed,  and  threats  to  the  public  interest 
identified in 15 cases (three in 2020). Ten reports were forwarded to the prosecution service, 
and  18  to  other  competent  state  institutions.  The  Agency  identified  irregularities  in  three 
cases.  

Between January and- June 2022, three requests for whistle-blower protection were submitted 
to  the  Agency;  work  on  these  is  ongoing.  In  this  period,  the  Agency  received  a  further  89 
reports on the threat to public interest, with19 reports being processed, establishing a threat to 
public interest in four cases. Three reports were forwarded to the prosecution service.  

Further  sustained  results  are  needed,  including  by  increasing  the  ACA’s  human  resources 
expertise,  in  line  with  the  recommendations  of  the  April  2021  peer  review.  Montenegro 
remains the only country in the region without a specific law on whistleblowing; the subject 
remains covered by the Law on the prevention of corruption2. 

On integrity plans, in 2021, 692 reports (2020: 679) on the implementation of the integrity 
plans for 2020 were submitted to the Agency. 99.3% of authorities have an integrity manager 
in  place.  In  2021,  the  Agency  introduced  evidence-based  methodology  for  assessing  the 
application  of  anti-corruption  measures  in  public  institutions.  The  State  administration  and 
social and child protection services were selected to pilot the methodology.  

On  lobbying,  the  lobbying  register  includes  six  individuals  and  one  legal  entity.  The  new 
Commission  on  Lobbying  was  appointed  and  two  calls  for  applicants  were  published  in 
March and May 2022. The Anti-Corruption Agency participated in the work of the working 
group on amending the Law on lobbying established by the Ministry of Justice, Human and 
Minority Rights. Montenegro has yet to adopt the law.  

In September 2021, the government adopted the Code of Ethics for top executive officials, 
in  the  form  of  non-binding  guidelines,  to  implement  rules  on  prevention  of  corruption. 
However, no disciplinary sanctions can be imposed until the Law on government is adopted 
in Parliament.  

2 According to the peer review experts, the law should lay down an obligation for the institutions to report to the Agency in 
cases of internally filed reports. 

31 

 
 
                                                           
Legal framework 

In March 2022, the government launched a thorough analysis of the Law on the prevention of 
corruption that is expected to lead to several recommendations for its amendment.  

Key shortcomings identified in the legal framework for the prevention of and fight against 
corruption and its effective enforcement need to be addressed. The existing legal framework 
on  asset  confiscation  needs  to  be  reviewed  and  its  effective  enforcement  must  improve 
substantially,  in  line  with  the  EU  acquis,  European  standards  and  best  practice.  In  this 
respect,  Montenegro  has  yet  to  address  in  full  the  recommendations  of  the  EU  peer  review 
missions  conducted  in  2019  and  2021  and  the  Council  of  Europe  Group  of  States  against 
Corruption  (GRECO).  Montenegro  is  preparing  a  new  law  on  amending  the  Law  on  the 
confiscation of material benefit derived from criminal activities (‘the Law on confiscation’), 
which  will  be  central  to  improving  the  criminal  justice  response  to  the  fight  against 
corruption. 

All shortcomings in the existing legal framework on political parties’ financing, including 
those  identified  in  recommendations  of  the  OSCE  Office  for  Democratic  Institutions  and 
Human  Rights  (ODIHR),  are  still  to  be  addressed.  The  current  legal  framework  does  not 
provide  for  effective  safeguards  and  sanctions  against  circumvention  of  the  rules,  which 
limits effective oversight. The legal framework regulating political parties and their funding 
still  depends  on  the  political  parties  themselves.  Limited  progress  has  been  achieved  on 
amending the rules on calculation and reporting of in-kind donations, in line with the Council 
of  Europe’s  recommendations  and  aligning  the  annual  financial  reporting  form  with  best 
accounting practice, which have been pending since 2014.   

In  December  2021,  draft  amendments  to  the  Law  on  free  access  to  information  were 
proposed  by  the  government  but  are  pending  parliamentary  adoption.  A  working  group  to 
produce  guidelines  for  proactive  publishing  of  information  has  been  set  up.  These  steps 
should pave the way for increased transparency and accountability of public bodies towards 
Montenegrin  citizens.  In  2021,  5  285  complaints  in  relation  to  free  access  to  information 
were  filed  (2020:  4328)  and  351  complaints  (8.57%)  were  rejected  by  the  Agency  for 
Personal Data Protection as unfounded, while 4 095 complaints were reviewed3.  

Fundamental rights  

Montenegro  is  moderately  prepared  in  the  area  of  fundamental  rights.  The  legislative  and 
institutional  framework  is  largely  in  place  and  Montenegro  continues  to  meet  its 
international  obligations  on  human  rights.  However,  additional  efforts  remain  needed  to 
implement it fully. The reporting period was marked by increased societal polarisation and 
division.  Most  vulnerable  groups  in  society  (including  Roma  and  Egyptians,  persons  with 
disabilities,  LGBTIQ  persons)  were  increasingly  subjected  to  discrimination,  hate  speech 
and  hate  crime.  An  increased  number  of  femicides  with  insufficient  follow  up  by  the 
authorities,  publicly  expressed  misogyny,  gender-based  violence  and  violence  against 
children are issues of serious concern. More efforts need to be undertaken to ensure access to 
justice and the enforcement of rights in administrative and judicial proceedings in particular 
for vulnerable groups. 

Last  year’s  recommendations  have  been  only  partially  addressed  and  remain  valid.  In  the 
coming year Montenegro should in particular: 

3 The Agency’s Director informed the media about continuous abuse of the right to access information, pointing that out of 3 
491  complaints  received  in  Jan-April  2022  almost  half  were  filed  by  a  lawyer  from  Podgorica  in  relation  to  payrolls  of 
Podgorica  school  teachers.  According to  the  Agency,  these  requests  are  not  aimed  at  accessing  data,  but  rather  at  gaining 
material benefits based on court costs (reportedly, several hundreds of thousands of euros). 

32 

 
 
                                                           
  revise legislation to: increase protection against domestic violence, discrimination, hate 
crimes  and  hate  speech;  comply  with  2018  UN  Universal  Periodic  Review 
recommendation to prohibit the statute of limitations for criminal offences of torture and 
other forms of ill treatment; fully harmonise with the 2020 same-sex partnership law; to 
fully  align  with  the  Optional  Protocol  to  the  Convention  on  the  Rights  of  the  Child; 
criminalise all forms of marriage with a person under age 18 and to align protection of 
personal data; 

  improve interinstitutional cooperation to achieve more efficient protection from all kinds 
of  discrimination,  better  access  to  justice,  full  enjoyment  of  procedural  rights,  and  free 
legal  aid  for  victims  of  human  rights  violations  and  crimes,  in  particular  children, 
women,  persons  belonging  to  minorities,  including  Roma  and  Egyptians,  and  persons 
with disabilities; 

  ensure full operational capacity of the Constitutional Court and harmonised interpretation 
of  ECtHR  case  law  and  European  and  international  human  rights  standards  throughout 
the court system. 

As  regards  international  human  rights  instruments,  Montenegro  continued  its  regular 
dialogue  with  international  human  rights  organisations  and  monitoring  bodies,  the  United 
Nations,  and  the  Council  of  Europe.  Montenegro  fulfils  its  obligations  under  international 
human  rights  instruments  and  legislation.  In  June  2021,  the  government  submitted  a 
voluntary mid-term report on the level of implementation of recommendations from the 2018 
Universal Periodic Review. In October 2021, the UN General Assembly elected Montenegro 
as new member of the UN Human Rights Council. On June 8 2022, the ‘Marrakesh Treaty to 
Facilitate  Access  to  Published  Works  for  Persons  who  are  Blind,  Visually  Impaired  or 
Otherwise  Print  Disabled’  entered  into  force  in  Montenegro,  allowing  for  copyright 
exceptions  to  facilitate  the  creation  of  accessible  versions  of  books  and  other  copyrighted 
works.  Montenegro  has  yet  to  ratify  the  International  Convention  on  the  Protection  of  the 
Rights of All Migrant Workers and Members of Their Families (ICRMW), signed in October 
2006, the Protocol  of 2014  to  the 1930 Forced  Labour Convention, the 2019  ILO Violence 
and  Harassment  Convention  (entered  into  force  on  25  Jun  2021),  or  the  2019  Framework 
Convention on Tourism Ethics of the UN World Tourism Organization. Montenegro has yet 
to submit its reports to the International Covenant on Economic, Social and Cultural Rights – 
CESCR (due in 2019), the International Covenant on Civil and Political Rights – CCPR (due 
in  2021)  and  the  International  Convention  on  the  Elimination  of  All  Forms  of  Racial 
Discrimination – CERD (due in 2021). 

Montenegro  continued  to  ensure  good  cooperation  with  the  European  Court  of  Human 
Rights (ECtHR). In the reporting period, 380 new applications concerning Montenegro were 
allocated to a decision body of the Court, bringing the number of applications pending before 
it  to  291  on  15  June  2022.  The  ECtHR  delivered  judgements  in  six  cases,  finding  five 
violations of the European Convention on Human Rights. While most violations related to the 
right  to  fair  trial  in  connection  with  the  length  of  proceedings,  the  Court  also  found  one 
violation  regarding  the  right  to  respect  for  private  and  family  life.  Currently,  there  are  no 
cases under enhanced supervision by the Committee of Ministers.   

On  the  promotion  and  enforcement  of  human  rights,  institutional  capacities  need  to  be 
further strengthened, including by allocation of appropriate funding. Fundamental changes in 
the management and structure of the Ministry, as well as politically biased appointments and 
dismissals  during  the  reporting  period  affected  its  effective  functioning  and  resulted  in  a 
slowdown  in  the  drafting  of  new  human  rights  legislation,  strategies  and  policies,  and  the 
implementation and monitoring of existing ones.  

33 

 
 
The  regulatory  and  institutional  framework  for  the  functioning  of  the  Ombudsperson  is  in 
place.  It  is  accredited  with  ‘B’  status  from  the  Accreditation  Subcommittee  of  the  Global 
Alliance of National Human Rights Institutions.  The Ombudsperson’s Office continued to be 
perceived  as  the  institution  with  the  best  impact  and  trust  regarding  the  promotion  and 
protection of citizens’ rights. The views of the institution are often quoted in the media. The 
Office’s capacity to handle complaints and the quality of its decisions continued to improve. 
Following a reduction in the budget for 2021 of around 6% compared to  2020, the adopted 
budget  for  2022  increased  7.6%  compared  to  2021.  In  June  2021,  the  Ombudsperson 
published a special report on the situation of children in dormitories and boarding schools in 
Montenegro. In 2021, the Office worked on 1 123 complaints (2020: 1 075), 968 of which it 
received in 2021 and 155 of which were held over from 2020. In 2021, the Office closed 904 
cases and deferred 219 to 2022. The closed cases related to civil rights, economic, social and 
cultural rights, prohibition of discrimination, rights of the child and the right to fair trial. The 
Office  determined  violations  of  rights  in  124  cases  and  gave  opinions  with  343 
recommendations to the competent authorities. Systematic, effective and prompt follow-up of 
the Ombudsperson’s recommendations by the authorities improved.  

The  decisions  of  the  Constitutional  Court  continued  to  be  harmonised  with  human  rights 
standards  and  ECtHR  case-law.  However,  there  are  still  cases  where  regular  courts  do  not 
follow  the  Constitutional  Court’s  decisions  and  interpretation  of  human  rights  standards. 
From  the  current  backlog  of  3  219  cases  pending  before  the  Constitutional  Court,  2  967 
(92%) are complaints on human rights violations. In September 2021, the ECtHR established 
a  violation  of  the  right  to  trial  within  a  reasonable  time  before  the  Constitutional  Court 
(Siništaj  vs  Montenegro).  This  might  put  at  risk  the  2015  ECtHR  position  on  the 
effectiveness of the constitutional complaint as a legal remedy at the national level. Due to its 
incomplete composition the Constitutional Court lacks the required quorum to take decisions 
and is unable to operate. 

As  regards  the  prevention  of  torture  and  ill  treatment,  in  May  2022  the  UN  Committee 
against Torture (CAT) concluded that Montenegro had only  partially implemented its 2014 
recommendations  on  ensuring  or  strengthening  legal  safeguards  for  detainees,  conducting 
prompt,  impartial  and  effective  investigations,  and  prosecuting  suspects  and  sanctioning 
perpetrators of torture or ill treatment. The European Committee for the Prevention of Torture 
and  Inhuman  or  Degrading  Treatment  (CPT)  carried  out  an  ad  hoc  visit  to  Montenegro  in 
June 2022. Amendments to the Criminal Code to comply with 2018 UN Universal Periodic 
Review recommendation to prohibit the statute of limitations for criminal offences of torture 
and  other  forms  of  ill  treatment  are  not  yet  in  place.  Shortcomings  in  internal  control, 
protracted  and  inefficient  investigations,  lenient  and  non-deterrent  sanctions,  and  impunity 
for perpetrators of violence remain causes for concern. The government needs to increase its 
efforts to conduct efficient, effective and independent investigations to address police torture, 
violations, and illegal use of coercive measures. CSOs conducting monitoring visits noted an 
increased number of police officers who are aware of and apply the April 2021 instructions 
on  the  treatment  of  detainees  and  people  under  arrest.  An  official  evaluation  of  the 
instructions’ implementation is envisaged for late 2022. The National Prevention Mechanism 
(NPM) was strengthened through the appointment of a Deputy NPM in December 2021. The 
NPM  did  not  work  at  full  capacity  for  most  part  of  2021  due  to  COVID-19  affecting 
employees.  During  the  reporting  period,  the  NPM  processed  91  cases,  most  of  them 
concerning the Institute for the Execution of Criminal Sanctions (46) and the police (11). The 
NPM  found  evidence  of  inhuman  and  degrading  treatment  in  two  cases;  seven  cases  are 
pending.  

34 

 
 
The NPM brought 27 cases over the conduct of police officers during the enthronement of the 
Metropolitan in the Cetinje Monastery on 5 September 2021. Of these, 21 related to the use 
of  chemical  agents,  one  to  exceeding  authorisation,  two  for  restrictions  on  freedom  of 
movement, two for destruction and damage to other people’s property and one relating to the 
right  to  information).  In  two  cases,  a  violation  of  rights  was  established;  in  two  cases,  no 
violation  was  found,  while  in  two  other  cases  the  applicants  were  referred  for  other  legal 
remedies. The proceedings in the remaining cases, which mainly deal with the excessive use 
of  chemical  agents,  are  pending.  Despite  the  introduction  of  visible  identification  markings 
(names, surnames, number of official badges, etc.) on police uniforms and protective helmets 
enabling identification and efficient investigations, their use is not systematic. 

Some  progress  was  made  towards  implementing  the  CPT’s  2019  recommendations  on  the 
prison system and conditions of detention. An evaluation of the implementation of the 2017-
2021  strategy  for  the  execution  of  criminal  sanctions  is  ongoing.  Staff  reinforcement  and 
capacity  building  continued,  as  well  as  programmes  and  activities  available  to  prisoners. 
Existing  prison  facilities  underwent  some  adaptation  and  modernisation.  Preparations  are 
ongoing to build a new prison facility in Mojkovac for the north of Montenegro, and a special 
health  institution.  Standard  operating  procedures  for  the  prison  system  are  being  revised. 
Several NGOs implemented educational, recreational and vocational activities for prisoners. 
During  2021,  juvenile  convicts  took  part  in  various  daily  activities  in  the  juvenile  prison 
department,  including  sports,  cultural  and  educational  activities,  and  psychological  and 
creative  workshops  for  reintegration  purposes.  As  of  April  2022,  there  are  a  total  of  614 
convicts  and  403  detainees,  3.65%  of  which  are  women  (2020:  2.6%).  In  2021,  the  NPM 
performed 32 out of 40 planned monitoring visits to prisons, detention and reception centres. 
During the reporting period, the NPM reported one case of inhuman and degrading treatment 
in  prisons  (ECHR  Article  3)  and  established  in  one  case  that  the  material  conditions  of 
detention result in a degrading treatment; one case is pending. The Ombudsperson also issued 
three opinions with recommendations but established no violation of Article 3. Despite some 
improvement, the material conditions in prisons, pre-trial detention facilities and psychiatric 
hospitals  are  still  below international  standards.  Pre-trial  detention  continues  to  suffer  from 
overcrowding,  with  350  occupants  for  292  places.  Conditions  in  the  overcrowded  Dobrota 
psychiatric hospital remain very poor. 

On protection of personal data, Montenegro continued working on alignment with the EU 
acquis. The draft law on personal data protection is expected to be finalised in autumn 2022. 
Work  is  ongoing  on  alignment  with  other  relevant  parts  of  the  EU  acquis  relating  to 
investigating, detecting or prosecuting criminal offences or executing criminal sanctions. The 
human  resources  capacity  of  the  Agency  for  Personal  Data  Protection  and  Free  Access  to 
Information  needs  to  be  further  strengthened.  The  number  of  complaints  is  increasing,  but 
overall awareness on personal data protection issues continues to be low. From 15 June 2021 
to  23  June  2022,  the  Agency  carried  out  105  supervisions  in  the  field  of  personal  data 
protection.  However,  the  Agency’s  work  was  blocked  following  Parliament’s  dismissal  in 
December  2021  of  the  President  and  one  member  of  the  Council  for  Personal  Data 
Protection. In August 2022, the Parliament appointed a new President and one member of the 
Council  and  on  12  August  2022  the  constitutive  session  of  the  Council  of  the  Agency  was 
held in its new composition.  

Several  hundred  compensation  claims  relating  to  protection  of  personal  data  are  pending 
before  the  courts.  The  claims  follow  a  first-instance  court  decision  in  May  2021  awarding 
compensation owing to the authorities’ publication of a list of individuals subject to COVID-
19  self-isolation  measures  in  spring  2020,  which  was  declared  in  violation  of  the 
Constitutional right to privacy by the Constitutional Court in July 2020. Montenegro has not 

35 

 
 
yet signed the 2018 Council of Europe Protocol amending the Convention for the Protection 
of Individuals regarding the Automatic Processing of Personal Data (CETS 223).  

On  freedom  of  thought,  conscience,  and  religion,  the  government  and  the  Serbian 
Orthodox  Church  signed  in  August  2022  a  fundamental  agreement,  amidst  protests  from 
CSOs,  several  members  of  the  government  and  some  political  parties,  leading  to  a  no-
confidence  vote  and  the  subsequent  fall  of  the  government.    Religiously  motivated  attacks, 
for  instance  during  the  enthronement  of  the  Metropolitan  in  the  Cetinje  Monastery  in 
September 2021 or on a bus transporting children and young people from Niksic in Cetinje in 
April 2022, are a matter of serious concern.   

Freedom of expression  

Montenegro has a pluralistic media environment and has achieved some level of preparation 
on  freedom  of  expression.  Limited  progress  was  made  on  last  year’s  recommendations. 
There  were  improvements  to  the  legal  framework  on  protection  for  journalists  and  other 
media  workers  was  improved.  Although  the  initial  institutional  response  to  recent  cases  of 
violence against journalists has been generally prompt, lack of effective judicial follow-up on 
important old cases remains a matter of serious concern. The findings and recommendations 
of  the  new  ad  hoc  commission  for  monitoring  violence  against  the  media  need  to  be 
effectively addressed by the relevant authorities. The revision of the legal framework and the 
drafting of the media strategy are yet to be streamlined in order to ensure mutual consistency 
and full alignment with the EU acquis and relevant European standards. Sustained efforts are 
needed to counter disinformation and limit the effects of online harassment and hate speech 
without  disproportionately  limiting  freedom  of  expression.  The  public  broadcaster  RTCG 
continued to produce politically balanced and diverse content. Deep political polarisation of 
the  media  scene  persisted,  while  growing  competition  from  big  regional  media  placed 
additional strain on the local media market. Further sustained efforts are needed to establish 
effective self-regulatory mechanisms. 

Last  year’s  recommendations  were  only  partly  addressed,  and  they  remain  valid.  In 
addressing the shortcomings, Montenegro should in particular: 

  strengthen the effective protection of journalists and other media workers, through the full 

and effective judicial follow-up of threats and attacks, including old cases; 

  refrain  from  any  action,  either  political,  legislative  or  administrative,  that  threatens  to 
undermine the editorial, institutional or financial independence of the public  broadcaster 
and continue restoring its editorial independence and professional standards; 

  streamline  the  revision  of  media  legislation  and  the  drafting  of  the  media  strategy, 
through inclusive dialogue with media and civil  society, and in line with the EU  acquis 
and relevant European standards. 

Intimidation of journalists 

The  institutional  and  law  enforcement  response  to  address  new  cases  of  violence  against 
journalists  and  media  workers  has  improved.  However,  there  has  been  no  breakthrough  in 
critical  old  cases,  including  the  2004  murder  of  the  editor-in-chief  of  the  daily  newspaper 
Dan. In December 2021, the police arrested two individuals, one of whom a police officer, on 
suspicion  of  being  involved  in  the  2018  shooting  of  an  investigative  journalist.  However, 
effective judicial follow-up of the case is yet to be ensured. In 2021, the authorities registered 
24  cases  of  violence  against  journalists,  predominantly  involving  threats,  intimidation  or 
harassment, but  also including instances of physical violence.  Between 15 June 2021 and 6 
June  2022,  the  prosecution  service  dealt  with  14  cases  of  violence  against  journalists  and 

36 

 
 
attacks  on  their  property,  filing  indictments  in  six  of  those  cases  and  dismissing  criminal 
charges in two. In one case, misdemeanour proceedings were launched, while a preliminary 
investigation  was  ongoing  in  the  remaining  five.  In  2021,  the  police  registered  23  cases  of 
violence against journalists or media workers. 

On 25 May, the Supreme Court upheld the appeal quashing the High Court’s and Appellate 
Court’s verdicts on the case of investigative journalist Jovo Martinovic, who was sentenced 
to a year in prison for involvement in drug smuggling while he was conducting journalistic 
investigations.  

The government adopted two reports by the new ad hoc commission for monitoring violence 
against the media, in October 2021 and in March 2022, and instructed its General Secretariat 
to present the reports to the Supreme State Prosecutor’s Office. The commission found that 
the police and the prosecution service had taken all steps within their power to solve certain 
cases. In other cases, however, certain omissions and need for a more agile response from the 
authorities  were  noted.  The  authorities  need  to  ensure  effective  follow-up  of  the 
Commission’s  recommendations,  while  providing  it  with  all  the  necessary  means  to 
effectively  perform  its  work.  Specific  recommendations  from  the  previous  commission 
concerning  critical  old  cases  of  attacks  on  journalists  remain  to  be  fully  and  effectively 
addressed by the relevant authorities.  

Instances  of  senior  public  officials  and  top  government  ranks  engaging  in  strongly  worded 
public criticism of the work of both public and private media outlets continued to occur. The 
authorities  should  promote  and  preserve  an  environment  conducive  to  investigative 
journalism and media freedom by promptly reacting to and publicly condemning hate speech 
and  threats,  and  by  refraining  from  exercising  political  pressure  on  journalists,  including 
through their public statements. 

Legislative environment 

In December 2021, Parliament adopted a set of amendments to the Criminal Code providing 
penalties that are more stringent in cases of violence against journalists. Under the amended 
legislation journalists are granted the status of persons who perform duties of public interest, 
while  several  criminal  offences,  including  murder,  infliction  of  serious  bodily  injuries, 
coercion  by  using  force  or  threat  and  endangering  of  safety,  will  carry  longer  prison 
sentences  when  committed  against  journalists.  The  legal  amendments  also  introduce  longer 
prison sentences for unlawful obstruction and prevention of the production and distribution of 
media content.  

The working group tasked with drafting amendments to the RTCG Law, the Media Law and 
the  new  Law  on  audio-visual  media  services  has  advanced  in  its  work,  including  with  the 
meaningful  involvement  of  civic  stakeholders.  In  March  2022,  the  Ministry  of  Public 
Administration, Digital Society and Media organised public consultations on the draft media 
strategy for 2022-2026 and the action plan for 2022-2023. So far, both legislative and policy 
reform processes have been managed through an inclusive approach, with active involvement 
of stakeholders from the public sector, civil society and the media. The adoption of the draft 
media laws and strategy are pending. 

Implementation of legislation/institutions 

The application of the journalistic Code of Ethics and Professional Standards remains uneven 
across the media community, as the media scene continues to be highly politically polarised, 
with  weak  self-regulation  mechanisms.  A  working  group  comprising  representatives  of 
several self-regulatory authorities produced a set of guidelines for journalistic due diligence 
as set out in the 2020 Media Law, although these are not binding. 

37 

 
 
Public service broadcaster 

The  public  broadcaster  Radio  Televizija  Crne  Gore  (Radio  Television  of  Montenegro  – 
RTCG) continued to pursue a balanced editorial policy, featuring politically diverse content. 
In November 2021, the  government  decided to  submit to  Parliament several  draft laws  that 
proposed  to  abolish  fixed  budgetary  allocations  legally  guaranteed  to  several  institutions, 
including  RTCG.  The  decision  was  criticised  by  the  European  Broadcasting  Union  as 
seriously  undermining  RTCG’s  governing,  managerial  and  financial 
independence. 
Eventually,  the  Ministry  of  Finance  announced  that  the  draft  laws  would  be  temporarily 
withdrawn  pending  additional  consultations  with  relevant  stakeholders.  The  issue  of  an 
efficient legal remedy in cases of dismissals of RTCG Council members by Parliament is yet 
to be addressed, either through case-law or through legislation.  

Economic factors 

One  of  the  four  nationally  circulated  daily  newspapers  was  shut  down  in  December  2021, 
unable  to  cope  with  a  dire  economic  situation  exacerbated  by  the  COVID-19  crisis.  The 
growing  interest  of  big  regional  media  companies  in  the  national  media  market  creates 
increasingly  intense  competition  and  limits  the  revenues  for  small  local  media  outlets.  In 
December 2021, the Ministry of Public Administration, Digital Society and Media allocated 
approximately EUR 300 000 in grants for 36 print and online media projects from the Media 
Pluralism  and  Diversity  Fund  established  under  the  2020  Media  Law.  In  June  2022,  the 
Council  of  the  Agency  for  Electronic  Media  awarded,  from  the  same  Fund,  approximately 
EUR 220 000 in grants to 11 broadcasters.  In addition, the authorities continued to provide 
different  forms  of  financial  support  to  media  outlets  against  the  fallout  of  the  COVID-19 
crisis, including through exemption of broadcasting fees for 2022.  

Internet 

In  April  2022,  the  Council  of  the  Agency  for  Electronic  Media  (AEM)  instructed  all 
providers  of  audio-visual  media  services  in  Montenegro  to  suspend  the  broadcasting  of 
Russian  state-controlled  media  RT  and  Sputnik,  including  through  transmission  or 
distribution by any means such as cable, satellite, IP-TV, internet service providers, internet 
video-sharing platforms or applications, whether new or pre-installed. Disinformation, online 
harassment  and  hate  speech  remain  a  frequent  occurrence,  including  on  social  media  pages 
and  comments  sections  of  online  media  outlets.  The  legal  requirement  for  the  removal  of 
illegal third-party comments from online media platforms should be formulated in a manner 
that does not place an undue administrative burden on online media, particularly on smaller 
services.  

Along with  more than 60 international  partners,  Montenegro signed the  Declaration for the 
Future  of  Internet  of  28  April  20224,  which  sets  out  the  vision  and  principles  of  a  trusted 
Internet. 

Freedom of artistic expression 

Freedom of artistic creation and publication of works of art is guaranteed by the Constitution. 
As part of the public health measures to curb the spread of COVID-19, the health authorities 
imposed  temporary  bans  on  artistic  performances  in  public  spaces,  in  particular  on  live 
performances of musicians. The bans were lifted as the COVID-19 situation improved.  

Professional organisations and working conditions 

4 Declaration for the Future of Internet | Shaping Europe’s digital future (europa.eu) 

38 

 
 
                                                           
Journalists  continued  to  report  overall  poor  working  conditions,  including  low  salaries, 
unpaid overtime work, security risks and different forms of pressure and undue influence on 
their  work,  both  from  media  owners  and  third  parties.  The  trend  of  media  outlets  and 
journalists launching defamation lawsuits against their competitors has continued. The socio-
economic  situation  and  working  conditions  are  particularly  difficult  in  local  public 
broadcasters, which are directly exposed to editorial influence and financial control by local 
authorities.  

(See also Chapter 10 – Digital transition and media)  

Freedom  of  assembly  and  association  continued  to  be  broadly  respected  during  the 
reporting  period  and  most  unannounced  gatherings  were  held  peacefully.  The  Law  on 
freedom of assembly is still unevenly applied, including arrests and fines, depending on the 
nature  of  the  public  gathering.  Amendments  to  the  Law  on  public  assemblies  and  public 
events to regulate more precisely spontaneous assemblies are still outstanding. In 2021, 287 
public  assemblies  took  place  (2020:  247).  The  police  issued  eight  decisions  on  temporarily 
banning public assemblies, while there were no disruptions or restrictions of reported public 
assemblies. The mass gatherings during the enthronement of the Metropolitan in the Cetinje 
Monastery on 5 September 2021 had not been announced to the police, thus preventing them 
from  taking  appropriate  security  measures.  Violent  clashes  between  police  and  some 
protesters took place amidst the otherwise peaceful religious ceremony. Formal investigations 
into the use of excessive force and torture by the police are ongoing. Following the proposal 
to form a minority government in January 2022, protests took place all over the country.  

Regarding  property  rights,  some  progress  was  made  in  addressing  shortcomings  in  the 
expropriation of land in the coastal zone, as identified by the ECtHR. The legal opinions of 
the  Supreme  and  Constitutional  Courts  in  the  application  of  property  rights  have  been 
harmonised to a certain extent. However, the process of restitution of properties expropriated 
in  the  past  remains  slow  despite  repeated  opinions  of  the  Ombudsperson,  and  Montenegro 
still needs to ensure fair restitution proceedings within a reasonable time. Women continue to 
face difficulties when claiming inheritance and property rights in divorce proceedings. 

On  non-discrimination,  work  to  ensure  full  compliance  with  the  EU  acquis  and  European 
standards  on  anti-discrimination  is  ongoing.  Following  recommendations  of  EU-funded 
experts, in  November 2021 the Ministry of Justice, Human and Minority  Rights  decided to 
draft a completely new law on prohibition of discrimination that would meet European anti-
discrimination  standards,  comply  with  the  2017  recommendations  of  the  European 
Commission against Racism and Intolerance (ECRI), and provide quality protection against 
discrimination to all citizens. Work is ongoing to draft a new law.  

The  reporting  period  was  marked  by  high  societal  polarisation  and  division.  The  most 
vulnerable  groups  in  society  (including  Roma  and  Egyptians,  persons  with  disabilities, 
LGBTIQ  persons)  were  increasingly  subjected  to  discrimination,  hate  speech  and  hate 
crimes. The increase in hate speech persists, particularly against women in politics. There is 
an urgent need to eradicate all forms of discrimination by using legal protection mechanisms 
and  to  address  deeply  rooted  societal  behaviours  that  degrade  and  discriminate  against 
women, resulting in instances of gender-based violence. Accepting and respecting pluralism 
in  society needs  to  be addressed from an early age through  engagement  with  young people 
and adults to promote behavioural changes and tolerance of diversity. The Ombudsperson’s 
capacity to serve as inequality body continued to improve, although the overall institutional 
framework  needs  to  be  improved.  In  2021,  the  Ombudsperson’s  Office  received  173 
complaints  of  discrimination  (2020:  159  cases).  The  majority  concerned  labour  and 
employment,  social  services,  domestic  and  gender-based  violence  and  proceedings  before 

39 

 
 
public  authorities.  Ten  complaints  were  received  regarding  hate/discrimination  on  the 
internet.  The  2017  priority  recommendation  of  the  ECRI  to  put  in  place  a  system  for 
collection of disaggregated data on hate crime is yet to be implemented as it depends on the 
reform of the Criminal Code (amendments on bias motives), which is expected later in 2022. 

On gender equality, the shortcomings identified by the evaluation of the 2017-2021 action 
plan remain largely unaddressed.  

In July 2021, the government adopted the 2021-2025 national strategy for gender equality, its 
action plan for 2021-2022 and the final report on the implementation of the 2017-2021action 
plan  for  achieving  gender  equality.  The  strategy  introduced  some  important  novelties  that 
could  contribute  towards  improving  women’s  rights  and  gender  equality  in  Montenegro. 
These include suggestions from specialised NGOs for better gender mainstreaming of public 
policies,  an  increase  in  the  election  quota  for  the  less  represented  gender,  and  the 
establishment of an alimony fund. However, Montenegro must address the issue of gender-
based violence and domestic violence in the strategy.  The legislative framework on gender 
equality still has a limited impact due to insufficient political will to prioritise this issue in the 
overall governmental accountability mechanisms.  

Difficulties remain, notably in relation to  female labour market participation and vocational 
training. Women  also  remain under-represented in political  and economic decision-making. 
Women make up only a quarter of the total management in the public administration, often 
due to explicit or implicit bias in hiring, training and promotion practices. There has been an 
increase in smear campaigns, hate speech and use of gender-based violence against women in 
politics  and  public  life.  Women  have  been  disproportionately  affected  by  the  COVID-19 
pandemic.  

Gender-based  violence,  in  particular  domestic  violence,  remains  a  serious  and  persistent 
criminal,  societal  and  public  health  issue.  Although  some  training  and  awareness-raising 
campaigns  were  organised  during  the  reporting  period,  issues  such  as  deeply  rooted 
patriarchal  norms  and  stereotypes,  limited  awareness  on  the  part  of  both  individuals  and 
institutions, and to the lack of efficient systemic response and commitment  to protection of 
victims,  all  contribute  to  further  exacerbating  the  consequences  of  gender-based  violence. 
There  were  no  developments  in  the  legal  framework.  Specialised  NGOs  registered  an 
increase  of  around  20%  in  cases  in  2021  compared  to  the  previous  year,  and  even  of  80% 
compared  to  2019,  the  pre-pandemic  year,  which  proves  that  the  pandemic  and  lockdowns 
resulted in an increase in domestic violence. It is estimated that most cases of gender-based 
violence  remain  unreported.  According  to  judicial  data,  in  2021,  there  were  2  176 
misdemeanour  cases  of  domestic  violence  and  282  criminal  offences,  showing  that  state 
prosecutors are much more likely to opt for a milder qualification of the offence, i.e. mostly 
misdemeanour  proceedings  are  conducted,  while  criminal  cases  account  for  only  11.4%  of 
the  total  number  of  cases.  Reasons  for  this  include  victims’  reluctance  to  testify,  and  a 
backlog of cases. Further training and specialisation of judges is needed to address this. 

Montenegro has yet to adopt a  new strategy on protection from violence. Cases of violence 
against  women  through  digital  means  are  also  increasing,  including  cyber  stalking  and 
distribution of intimate photo or video materials, often followed by threats and psychological 
violence.  The  Ministry  of  Finance  and  Social  Welfare  set  aside  EUR  200  000  for  licensed 
service providers for victims of violence in the budget proposal for 2022 and participated in 
the  CSO-led  campaign  ‘16  days  of  activism’,  which  marked  the  fight  against  gender-based 
violence. EUR 140 000 have been allocated for financing NGO projects  related to violence 
against  women  and  domestic  violence.  The  State  does  not  provide  enough  specialised 

40 

 
 
services  for  women  and  children  who  have  survived  violence.  Crisis  centres  and  clear 
protocols for victims of sexual violence have not been established.  

On the rights of the child, the legislative and institutional framework is largely aligned with 
international  and regional  human rights  instruments,  including  all areas covered by the  UN 
Convention on the Rights of the Child and its protocols. Montenegro continued implementing 
its strategy for the prevention and protection of children against violence and its action plan 
(2017-2021). However, challenges remain over its effective implementation, primarily due to 
a poor accountability  framework, inadequate and insufficient  administrative  capacities, lack 
of  systematic  monitoring  and  quality  assurance  of  existing  laws  and  strategies,  and 
insufficient funding to ensure that children’s rights are enforced.  

The  Ombudsperson’s  Office  received  165  cases  relating  to  the  rights  of  the  child.  The 
COVID-19 pandemic continued to have a negative impact on children. Besides domestic and 
sexual  violence,  peer  violence  at  school  –  bullying  –  is  an  alarming  growing  trend.  More 
efforts are needed to ensure child-friendly justice, in particular for vulnerable groups such as 
children who live in poverty, children with disabilities, children belonging to minorities and 
children living without parental care. The juvenile prison department established in October 
2020  continues  to  provide  dedicated  activities,  including  sports,  cultural  and  educational 
activities,  psychological  and  creative  workshops,  aiming  at  better  reintegration  of  juvenile 
convicts.  Montenegro  does  not  have  a  juvenile  justice  law  or  strategy.  The  practice  of 
arranged  child  marriages  among  the  Roma  and  Egyptian  communities  remains  a  matter  of 
concern. No progress has been made regarding the follow-up on the UN monitoring bodies’ 
recommendations to raise the minimum age for entering marriage. The Criminal Code is yet 
to be revised to fully comply with the Convention on the Rights of the Child and its Optional 
Protocol  (sale  of  children,  child  prostitution,  child  pornography)  and  legislation  needs  to 
address online child sexual exploitation.  

There  is  a  lack  of  systematically  collected  disaggregated  data  on  child  sexual  abuse  and 
sexual exploitation. The National Council on the Rights of the Child met only twice (in June 
and  November  2021).  The  Council’s  Secretariat  capacities  need  to  be  strengthened,  so  that 
the  Council  can  effectively  exercise  its  function  as  a  coordinating  mechanism  at  inter-
ministerial  level.  During  2021,  the  National  SOS  Children's  Telephone  Line  registered  942 
calls  (60%  girls  and  40%  boys).  More  human  and  financial  resources  are  needed  for  its 
proper functioning, better outreach to children and provision of quality support.  

In 2021, the number of children living in institutional care decreased by 11% in comparison 
with 2020; by the end of February 2022 the number was 115. Montenegro needs to accelerate 
the process of developing family and community-based services and deinstitutionalisation for 
children  without  parental  care.  Work  on  the  strategy  on  deinstitutionalisation  is  ongoing. 
Essential  services, such  as family outreach work, parenting programmes, different  forms  of 
foster care, home visitation, counselling and rehabilitation of child victims are not provided 
systematically.   

Regarding the rights of persons with disabilities, following the termination of the mandate 
of the Council for the Care of Persons with Disabilities, the former government established a 
new  Council  for  the  Rights  of  Persons  with  Disabilities  in  December  2021,  responsible  for 
interinstitutional coordination. The decision on its final composition is outstanding due to the 
change of government. The 2022-2027 strategy for protection from discrimination of persons 
with  disabilities  and  promotion  of  equality  and  the  action  plans  for  2022  and  2023  were 
adopted  in  July  2022.  Although  a  specific  strategy  for  the  protection  of  children  with 
disabilities is yet to be adopted, several strategies in other sectors (e.g. education, social and 
child protection) include specific measures and activities relevant to children with disabilities. 

41 

 
 
The  national  legislation  is  still  not  fully  aligned  with  the  UN  Convention  on  the  Rights  of 
Persons  with  Disabilities,  including  with  respect  to  a  human  rights-based  definition  of 
disability.  Montenegro  has  not  yet  adopted  an  action  plan  to  adopt  and  implement  the 
recommendations of the UN Committee on the Rights of Persons with Disabilities. Likewise, 
Montenegro  has  yet  to  adopt  the  law  on  professional  rehabilitation  and  employment  of 
persons  with  disabilities,  which  would  also  regulate  the  location  and  management  of  the 
corresponding fund. Limited progress was made in implementing the 2019-2020 action plan 
for  the  adaptation  of  public  buildings  for  persons  with  reduced  mobility  and  disabilities. 
Overall,  persons  with  disabilities  cannot  fully  exercise  their  rights  in  Montenegro  and 
continue  to  face  multiple  forms  of  discrimination.  Gaps  must  be  addressed  with  respect  to 
mainstreaming  their  rights  across  sectors  and  policies,  and  there  is  a  lack  of  a  harmonised 
concept of disability in the legislation. The reform of the National Disability Determination 
System, including the adoption of a law establishing a single body of expertise, is still not in 
place. It is important that NGOs and social partners are systematically involved in the process 
of drafting/amending relevant legislation and strategies and formulating projects. 

The  protection  of  the  rights  of  lesbian,  gay,  bisexual,  transgender,  intersex  and  queer 
(LGBTIQ) persons continues to increase. The ninth Podgorica Pride took place in October 
2021,  with  the  participation  of  high-ranking  government  officials  (Deputy  Prime  Minister, 
several ministers), and without any incident reported. In December 2021, Parliament adopted 
amendments  to  the  Law  on  compulsory  health  insurance,  the  Law  amending  the  Law  on 
social and child protection, and the amending the Law on personal income tax. A reference 
recognising same-sex partnerships was added to harmonise them with the Law on Same-sex 
Partnerships.  The  report  on  the  implementation  of  the  2021  action  plan  accompanying  the 
2019-2023 strategy, which was expected for Q1 2022, is delayed due to the formation of the 
new government. More efforts need to be invested in the national focal point network, tasked 
with  promoting  LGBTIQ  rights  at  the  local  level  and  monitoring  implementation  of  the 
national  strategy.  Most  activities  of  the  action  plan  are  implemented  by  NGOs,  some  in 
cooperation  with  the  Ministry  of  Justice  and  Human  and  Minority  Rights.  In  2021  the 
Ministry  of  Justice,  Human  and  Minority  Rights  allocated  almost  35%  more  funds  to 
LGBTIQ NGOs than in 2020. Limited progress is noted regarding the application of the 2020 
law  on  life  partnership  of  same  sex  partners  (same-sex  partnership  law).  So  far,  15  life 
partnerships have been concluded. A working group to prepare the draft law on legal gender 
recognition  has  been  established.  Hate  speech  and  homophobic  incidents  against  LGTBIQ 
persons, including by members of Parliament, remain a matter of grave concern. In 2021, 55 
reports were filed with the police against 57 people regarding discrimination against LGBTIQ 
persons.  Demand  for  social  services,  psychological  support  and  legal  aid  continued  to 
increase  due  to  the  COVID-19  pandemic,  as  did  the  economic  and  social  vulnerability  of 
LGBTIQ persons. 

The  amendments  to  the  Criminal  Procedure  Code  and  the  Criminal  Code  are  ongoing.  The 
objective  of  this  revision  is  to  fully  align  criminal  legislation  with  the  EU  acquis  and 
procedural  rights  standards  for  suspects  and  accused  persons,  and  victims  of  crime.  The 
amendments are intended to tackle the right to information and participation at all stages of 
the  proceedings,  unjustified  prolonged  pre-trial  detentions,  and  insufficient  protection  of 
victims,  in  particular  women  and  children,  as  well  as  the  overall  length  of  proceedings. 
Montenegro has  yet  to  adopt  the law on the treatment  of juveniles in  criminal  proceedings. 
The revision of the Law on free legal aid is under preparation. Comprehensive data on free 
legal aid is lacking as it depends on the development of the new judicial information system. 
The budget implemented for legal aid in 2021 amounted to EUR 121 500 (EUR 146 483 in 
2020). A systematic approach  to dealing with  and providing information  for victims is  still 

42 

 
 
lacking. Montenegro still needs to abolish the suspension the law on victims’ compensation 
and secure sufficient funding for victims’ support. 

The  legal  framework  and  institutional  mechanisms  to  promote  and  safeguard  the  rights  of 
persons belonging to minorities need to be substantially improved, fully implemented, and 
applied.  In  July  2021,  the  government  adopted  the  2021-2022  action  plan  for  the 
implementation  of  the  2019-2023  minority  policy  strategy,  including  activities  of  minority 
councils,  local  government  authorities,  and  NGOs.  Data  on  its  implementation  is  not 
available.  The  equal  treatment  of  minorities  in  Parliament  was  not  ensured.  Montenegro 
submitted  its  state  reports  under  both  the  Framework  Convention  for  the  Protection  of 
National  Minorities  and  the  European  Charter  for  Regional  or  Minority  Languages.  The 
monitoring and evaluation of projects financed by the Fund for the Protection and Realisation 
of Minority Rights remain insufficiently transparent. In 2021, the Ombudsperson handled one 
case of discrimination against minorities referring to  proceedings before  judicial authorities 
(2019:  two  cases).  The  worrying  trend  of  hate  speech  attacks  and  discrimination  against 
minorities  at  local  level  continued,  with  limited  response  from  the  relevant  authorities.  In 
addition  to  several  private  media  in  minority  languages,  the  public  broadcaster  RTCG 
broadcasts a number of TV and radio shows in the Albanian and Roma languages. The right 
of  minorities  to  use  and  to  be  educated  in  one’s  own  language  continue  to  be  respected. 
National  minorities  are  represented  in  public,  in  decision-making  bodies  and  in  the  civil 
service.  

The 2021-2025 strategy for the social inclusion of Roma and Egyptians and its 2021 action 
plan were adopted in September 2021. The 2022-2023 action plan, along with the report on 
the implementation of the 2021 action plan, were adopted in August 2022.  
For the first time, and in line with 2020-20305 EU Roma Strategic framework, anti-gypsyism 
is  addressed  as  a  specific  form  of  discrimination.  Roma  and  Egyptians  are  the  most 
vulnerable and discriminated persons belonging to minorities; their socio-economic situation 
worsened during the COVID-19 pandemic. In January 2022, the Roma Council submitted an 
initiative  to  Parliament  to  reduce  the  threshold  for  political  representation  of  Roma  in  the 
Law  on  the  election  of  councillors  and  deputies.  The  Parliamentary  Committee  for  a 
Comprehensive Reform of Electoral Legislation is responsible for this issue. There were no 
developments in this regard. 

A National Roma Contact Point (NRCP) has not been nominated since August 2020. Instead, 
there is a Head of the Department for Inclusion of Roma and Egyptians, under the Directorate 
for  Human  Rights  in  the  Ministry  of  Human  and  Minority  Rights  operating  with  limited 
funding, resources, institutional authority or ability of inter-ministerial coordination.  

Compared with the previous years, there is a trend towards increasing the budget allocated to 
actions supporting Roma inclusion, but appropriate planning and monitoring are lacking, as is 
financial control. In September 2021, the Ministry of Justice and Human and Minority Rights 
allocated EUR 320 000 to civil society organisations for 21 projects  on the social inclusion 
and promotion and protection of human rights of Roma and Egyptians in Montenegro.  

During  the  2021/2022  school  year, 1  856  Roma  pupils  attended  primary  schools,  with  207 
Roma in secondary education and 12 university students. There are  also 192 Roma children 
in  pre-school  education.  While  there  is  an  increase  in  the  coverage  of  Roma  children  in 
primary and secondary education, a drop in pre-school and university education is apparent. 

5 COM(2020) 620 final 
https://ec.europa.eu/info/sites/default/files/eu_roma_strategic_framework_for_equality_inclusion_and_participa
tion_for_2020_-_2030_0.pdf 

43 

 
 
                                                           
The significant increase in the number of secondary school pupils compared to previous years 
also  results  from  mentorship  support  provided  by  an  EU-funded  project.  According  to  the 
2018 UNICEF Multiple Indicator Cluster Survey6, only 77% of Roma and Egyptian children 
of primary school age attend school and only 7% of children of secondary school age (15–18) 
in Roma settlements attend secondary school or higher, in contrast to the general population, 
where  88%  of  children  attend  secondary  school.  There  were  22  Roma  education  mediators 
employed  in  2021/2022  in  seven  municipalities.  Overall,  the  quality  of  education  of  Roma 
children remains of great concern.  

The mapping of Roma settlements in Montenegro was completed in 2021 with the assistance 
of  the  Roma  Cooperation  Council.  Altogether,  14  municipalities  where  mainly  Roma  live 
were  mapped,  including  32  Roma  settlements.  Challenges  remain  in  coastal  municipalities, 
where private land ownership may lead to evictions of Roma families who reside there.  

Even though around 90% of Roma have health cards, access to health deteriorated due to the 
COVID-19 pandemic. Currently, the Ministry of Health  employs  three Roma and Egyptian 
health  mediators  on  a  permanently  basis.  There  is  great  need  to  increase  their  number, 
especially to facilitate access to health to displaced and internally displaced Roma. 

There were 1 335 Roma and Egyptians registered with the National Employment Bureau on 
21  April  2022  (739  female),  which  represents  2.6%  of  the  total  unemployed  people 
registered. Around 96% of the Roma registered have the lowest level of education and less 
than  1%  are  educated  to  secondary  level,  which  limits  the  range  of  employment 
opportunities. Public works and seasonal works programmes are continuously organised, with 
limited long-term effect.  

Roma  and  Egyptian  mediators  in  health,  employment  and  social  protection  are  still  hired 
through projects with limited duration and need to be fully integrated in the system and given 
permanent employment contracts.  

About one third (32.5%) of girls aged 15–19 and about one in six boys (15.8%) are currently 
married  or  in  union7.  There  is  still  no  evidence  that  child  begging  and  child  marriages  are 
systematically addressed.  

In the previous period, Ombudsman received a few complaints relating to discrimination and 
hate  speech  against  the  Roma  community.  Complaints  referred  to  hate  speech,  housing 
issues, and the employment status of Roma education mediators.  

The Romani language is not taught in schools.  

Regarding  displaced  and  internally  displaced  people,  from  7  November  2009  to  6  June 
2022,  there  were  15258  requests  for  permanent  or  temporary  residence.  Of  these,  15142 
requests  have  been  resolved  and  116  cases  still  pending.  For  12  402  people,  permanent  or 
temporary residence up to 3 years has been granted, 297 requests have been refused and 2443 
cases suspended due to incomplete or duplicated requests.   

On  statelessness,  in  the  period  between  the  implementation/entry  into  force  in  2018  of  the 
new Law on foreigners and August 2021, nine people were recognised as stateless, while for 
11 the procedure for determining statelessness is ongoing, one request was refused, and seven 
requests were suspended. To address the gaps in the procedure implementation (identified in 
2018),  the  Ministry  of  Interior,  together  with  UNHCR,  started  drafting  amendments  to  the 

6  Multiple  Indicator  Cluster  Survey  2018,  Montenegro  and  Montenegro  Roma  Settlements,  Survey  Findings  Report, 
December 2019, available at https://www.unicef.org/montenegro/sites/unicef.org.montenegro/files/2020-07/UNICEF%20-
%20MICS%20izvjestaj%20za%202018%20-%20ENG.pdf  
7 2018 Multiple Indicator Cluster Survey. 

44 

 
 
                                                           
Law on foreigners, in order to strengthen the statelessness determination procedure, primarily 
with  regard  to  procedural  guarantees  and  access  to  rights  during  the  procedure  and  upon 
recognition  of  stateless  status.  The  legal  amendments  should  enable  Montenegro  to  fully 
incorporate  international  standards  on  statelessness  into  its  national  legislation  and  grant 
stateless  persons  the  rights  to  which  they  are  entitled  in  line  with  the  1954  Convention. 
According  to  UNHCR,  there  are  currently  around  500  people  at  risk  of  statelessness  in 
Montenegro.  

Through  close  cooperation  between  the  Ministry  of  Interior  and  UNHCR,  the  new  birth 
registration practice for this specific group of people yielded results: birth registration of all 
stateless children in Montenegro known to UNHCR has been completed.  

On  citizenship  rights,  despite  the  previously  announced  decision  to  end  the  economic 
citizenship  programme  in  2021,  the  former  government  prolonged  the  programme  for  an 
additional  12  months  to  December  2022.  The  current  government  publicly  committed  to 
phasing-out the scheme by December 2022; however, in June 2022, it decided to lower the 
requirements  to  apply  for  it.  This  scheme  poses  risks  such  as  money  laundering  and 
corruption and should be terminated definitively. In its fourth and fifth reports under the visa 
suspension  mechanism8, 
that  Montenegro 
effectively  phase-out  the  investor  citizenship  scheme  completely  as  soon  as  possible. 
Montenegro has not yet implemented this request. 

the  European  Commission  recommended 

2.2.2  Chapter 24: Justice, freedom and security   

The  EU  has  common  rules  for  border  control,  visas,  external  migration  and  asylum. 
Schengen  cooperation  entails  lifting  border  controls  inside  the  EU.  Member  States  also 
cooperate  with  Montenegro  in  the  fight  against  organised  crime  and  terrorism,  and  on 
judicial, police and custom matters, all with the support of the EU justice and home affairs 
agencies.  

Montenegro  is  moderately  prepared  in  the  area  of  justice,  freedom  and  security.  The 
legislative and institutional frameworks are largely in place. Some progress was achieved in 
addressing last year’s recommendations, as Montenegro started revising its legal approach to 
financial  investigations  and  took  a  number  of  steps  to  improve  the  efficiency  of  criminal 
investigations. However, last year’s recommendations remain overall largely valid.  

On migration, Montenegro signed a cooperation roadmap with the European Asylum Support 
Office  (now  the  EU  Agency  for  Asylum)  and  joined  the  European  Migration  Network 
(EMN),  an  EU  network  of  migration  and  asylum  experts,  as  an  observer  member.  The 
processing time for asylum applications was reduced. Montenegro’s visa policy  is  yet to be 
fully aligned with the one of the EU. 

Montenegro  is  the  Western  Balkan  partner  hosting  the  highest  number  of  Ukrainian 
nationals  having  fled  the  war,  exceeding  1%  of  its  population.  It  adopted  a  decision 
granting one-year temporary protection to people fleeing Ukraine, under which more than 
5 552 Ukrainians, mostly women and children, have registered so far.  

In the coming year, Montenegro should in particular: 

  limit the use of plea bargains to exceptional cases, in order to enhance the transparency 
and credibility of the judicial response to organised crime through a more deterrent  and 
consistent sanctioning policy;  

8 COM(2021) 602 final. 

45 

 
 
                                                           
  review  the  legal  and  operational  approach  towards  financial  investigations,  asset 
recovery, the fight against money laundering and tobacco smuggling; align it with EU and 
international standards, and establish a convincing track record in these areas; 

  further strengthen the capacities in border management by addressing the critical gaps in 
human  resources  and  equipment;  take  the  necessary  steps  to  establish  an  Advance 
Passenger  Information  System  (API)  and  a  biometric  migrant  registration  system  that 
follows  the  Eurodac  model;  take  concrete  steps  to  fully  align  with  the  EU’s  list  of  visa 
required third countries and increase the accommodation capacity for migrants. 

Fight against organised crime 

Montenegro  has  some  level  of  preparation/is  moderately  prepared  in  the  fight  against 
organised  crime.  Some  progress  was  made  in  addressing  last  year’s  recommendations,  in 
particular  as  regards  the  efficiency  of  criminal  investigations.  The  full  use  of  special 
investigative  measures  was  restored.  Legislative  changes  introduced  safeguards  against 
political influence over the appointment or dismissal of the Head of the police. A register of 
beneficial ownership was created. The administrative framework  on firearms was improved 
and  a  new  strategy  on  the  prevention  of  terrorism,  money  laundering  and  the  financing  of 
terrorism was adopted. 

Some  key  figures  from  organised  crime  groups  were  arrested  and  another  record  of  drug 
seizures  was  reached.  The  first  joint  investigation  team  with  a  third  country  was  launched. 
The number of final convictions in organised crime cases is on the rise.  

However,  the  track  record  of  court  decisions  on  tobacco  smuggling  and  money  laundering, 
the use of financial investigations and the capacity to confiscate the proceeds of crime need to 
be  strengthened.  Montenegro  has  yet  to  address  some  systemic  deficiencies  affecting  its 
criminal justice system across the board, including the way organised crime cases are handled 
in  courts.  This  will  require  a  more  deterrent  sentencing  policy  and  a  revision  of  the  use  of 
plea bargains in organised and serious crime cases. 

Last year’s recommendations remain largely valid. In the coming year, Montenegro should in 
particular:  

  continue  to  increase  the  efficiency  of  criminal  investigations  by  establishing  an 
interoperable  system  with  a  single  search  feature  and  by  increasing  the  number  of 
investigators  and  experts  in  key  areas  such  as  financial  investigations,  cyber-crime, 
forensics and special investigative measures; 

  address the lengthy duration of trials and frequent adjournments in organised crime cases; 
ensure  stronger  mutual  understanding  between  courts  and  the  prosecution  on  key  legal 
concepts such as money laundering and the quality of evidence;  

  enhance  the  strategic  monitoring  of  the  criminal  justice  system  by  establishing  a 
centralised  database  of  organised  crime  and  high-level  corruption,  collected  from  all 
relevant authorities, for analysis and policy-making purposes. 

Institutional set-up and legal alignment 

In 2021, the number of police officers rose to 4 586 (from 4 139 in 2020). The ratio of police 
officers  remains  high,  at  730/100 000  inhabitants,  compared  with  an  EU  average  of 
333/100 000  (Eurostat, 2018-2020). However, unlike most EU Member States,  Montenegro 
includes border guards in the police (1 307 staff members),  as well as non-operational staff 
such as advisers and officers without police rank.  

46 

 
 
Montenegro continued to align its legal framework on the fight against organised crime with 
the  EU  acquis.  Amendments  to  the  Law  on  internal  affairs,  adopted  in  November  2021, 
addressed  a  recommendation  from  the  European  Commission  2021  annual  report  by 
improving  safeguards  against  political  influence  over  the  appointment  and  dismissal  of  the 
Head  of  the  police.  Addressing  another  recommendation  from  the  Commission’s  annual 
report,  amendments  to  the  Criminal  Procedure  Code  were  adopted  in  December  2021, 
restoring  the  use  of  some  special  investigative  measures  in  compliance  with  constitutional 
principles,  a  key  step  forward  for  the  efficiency  of  investigations  in  drug-related  cases.  As 
from  January  2022,  the  prosecution  service  could  again  use  undercover  activities,  or 
“controlled delivery”, whereby a consignment of drugs is detected and allowed to go forward 
in order to secure evidence against the perpetrators.  

A new serious and organised crime threat assessment was adopted in March 2022, identifying 
10 main criminal groups and 12 threats to the national security of Montenegro.  

The  strategic  framework  was  consolidated  by  the  adoption  in  December  2021  of  a  strategy 
for the prevention and suppression of terrorism, money laundering and financing of terrorism 
for  2022-2025  and  of  a  cyber-security  strategy  for  2022-2026.  Montenegro  is  Party  to  the 
Council of Europe Budapest Convention on cyber-crime and was among the 22 countries that 
signed its Second Additional Protocol on enhanced co-operation and disclosure of electronic 
evidence on 12 May 2022. 

Montenegro started reviewing its legal framework on asset confiscation to address the legal 
impediments to the recovery of the proceeds of crime, by drafting amendments to the Law on 
the confiscation of material benefit derived from criminal activities. 

On anti-money laundering, Montenegro has yet to align its Law on the prevention of money 
laundering  and  terrorism  financing  with  the  fourth  and  fifth  EU  Anti-Money  Laundering 
Directives  and  to  solve  some  implementation  issues  relating  to  beneficial  ownership  and 
supervision.  The  draft  law  on  games  of  chance,  intended  to  achieve  alignment  with 
international  best  practices,  has  yet  to  be  adopted.  The  current  law  leaves  substantial 
loopholes and increases the risk of money laundering and terrorist financing in this high-risk 
area, as legal safeguards against the influence of organised crime in the ownership structure 
of games of chance are insufficient.  

A  register  of  beneficial  ownership  was  created  in  February  2022,  providing  the  authorities 
with  information  on  the  individuals  ultimately  owning  or  controlling  the  shares  of  legal 
entities registered in Montenegro. The Central Bank of Montenegro has a central register of 
resident  accounts,  but  does  not  have  a  register  of  non-resident  accounts,  a  crucial  tool  for 
investigations  involving  non-residents.  The  problem  of  an  incomplete  land  cadastre, 
hampering  the  efficiency  of  financial  investigations  and  asset  confiscations,  has  not  been 
addressed. Five new members of the Prosecutorial Council were appointed by Parliament in 
December  2021.  In  February  2022,  the  newly  formed  Prosecutorial  Council  dismissed  the 
Special  Chief  Prosecutor,  based  on  a  disputed  interpretation  of  legal  conditions  for  old-age 
retirement of judges and prosecutors, following the adoption of the Law on pensions in 2020. 
His successor  was  appointed in  March 2022. The appointment,  at his  request,  of three new 
special prosecutors in June 2022 brought the number of special prosecutors to 16 (from 13). 
Human resources in the Special Prosecutor’s Office (SPO) remain nevertheless insufficient to 
cope with  the workload, with  up to  100 cases per special  prosecutor. The precarious office 
conditions in which the SPO is housed remain below the minimum safety and work standards 
needed for the proper functioning of the institution. The appointment of a new Chief Special 
Prosecutor  was  quickly  followed  by  the  appointment  of  a  new  Head  of  the  Special  Police 
Unit (SPU), a police department focusing only on organised crime and high-level corruption 

47 

 
 
and working in close cooperation with the SPO. Further to these appointments, 22 out of the 
32 police officers working in this unit were transferred to other police units, leaving these key 
positions  vacant.  Six  were  replaced.  The  total  number  of  police  officers  working  in  the 
broader  sector  of  the  fight  against  crime  stands  now  at  83  (compared  with  82  in  2020), 
including 16 in the SPU. This number remains largely insufficient to cope with the existing 
backlog and to absorb the ever-increasing number of new complex and high-profile organised 
crime  cases.  Both  SPO  and  SPU  lack  sufficient  specialisation  of  staff,  due  to  their  limited 
number. 

These human resources challenges are partly addressed in a rulebook establishing the internal 
organisation  and  job  descriptions  of  the  staff  of  the  Ministry  of  Interior  and  the  police, 
adopted  in  July  2022.The  lack  of  human  resources  in  key  sectors  of  the  police  needs  to  be 
addressed as a matter of priority to ensure an appropriate response to the threats of organised 
crime identified in Montenegro’s serious and organised crime threat assessment. In terms of 
equipment,  Montenegro’s  police  still  needs  to  establish  a  modern  case  management  system 
and software for processing financial investigations and  IT  forensic. A centralised database 
on organised crime and corruption collected from all relevant authorities is needed to process 
the track record and to serve reporting, monitoring and policy-making purposes.  

On firearms, the draft law on weapons, aligning the legal framework with the EU acquis on 
the acquisition and possession of weapons, is still pending adoption by Parliament. 

Implementation and enforcement capacity 

International  drug  smuggling  and  conflicts  between  competing  criminal  groups  remain 
typical  features  of  Montenegro’s  criminal  profile.  Some  Montenegrin  crime  groups  are  key 
players in international and large-scale cocaine trafficking and have the capacity to facilitate 
or control logistical  aspects  of transatlantic drug  shipments,  including  using corrupted crew 
members. They are also involved in violent activities, such as contract killings. However, in 
2021  there  were  no  gang-related  murders  for  the  first  time  in  several  years,  something  that 
has  been  a  characteristic  of  Montenegro’s  criminal  scene  in  the  last  10  years.  Preventive 
investigations and police intelligence have succeeded in preventing several planned murders 
of police officers, judges and prosecutors, including of the Chief Special Prosecutor, as well 
as 13 murders of members of other criminal groups.  

Montenegro’s  law  enforcement  agencies  had  key  successes  in  the  fight  against  criminal 
networks  in  2021,  including  the  arrest  of  leading  figures  in  criminal  groups,  both  in 
Montenegro  and  abroad  in  cooperation  with  foreign  police  services.  This  marks  a  turning 
point in  the fight  against organised crime.  In these high-profile  cases,  cooperation with  EU 
Member  States  through  Europol’s  Secure  Information  Exchange  Network  Application 
(SIENA) has been instrumental in the handling of the investigations. The shared intelligence 
also  resulted  in  the  arrest,  in  April  2022,  of  the  former  Supreme  Court  President  while  she 
was  attempting  to  board  a  flight  to  Serbia.  The  charges  related  to  suspicions  of  forming  a 
criminal organisation and exerting unlawful influence. Her son and bodyguard are also under 
investigation  in  the  same  case.  She  had  been  the  President  of  the  Supreme  Court  between 
2007 and 2020, and in parallel President of the Judicial Council between 2008 and 2014. In 
May  2022,  the  President  of  the  Commercial  Court  was  arrested  on  suspicion  of  forming  a 
criminal  group,  abuse  of  position  and  embezzlement  in  relation  to  bankruptcy  procedures. 
Seven  other  individuals  were  arrested  in  the  same  case,  including  four  bankruptcy 
administrators.  In  May  2022,  using  intelligence  from  EU  Member  States,  the  newly 
appointed  Chief  Special  Prosecutor  re-opened  an  investigation  into  three  police  officers 
suspected  of  involvement  in  drug  smuggling  and  organised  crime,  including  the  son  of  the 
former  Police  Director  for  the  fight  against  crime.  The  charges  against  them  had  been 

48 

 
 
dismissed  in  January  2022,  under  the  previous  management  of  the  Special  Prosecutor’s 
Office. 

In 2021, the SPO conducted 13 investigations into organised crime cases (compared with 25 
in 2020), targeting 103 people. Some 13 indictments were lodged for organised crime-related 
offences (from 29 in 2020) against 70 people.  

The  number  of  court  judgements  and  convictions  continued  to  rise  in  2021,  reflecting  the 
constant  increase  in  the  number  of  investigations  in  the  last  two  years.  There  were  73 
organised  crime  cases  adjudicated  by  the  Podgorica  High  Court  in  2021  (against  426 
defendants and 66 legal entities), up from 63 in 2020 and 22 in 2019. Some 10 cases against 
17 defendants ended in a conviction, all of them based on plea bargains.  

An external  assessment  of Montenegro’s sentencing policy, ordered by  the Supreme Court, 
concluded  that  courts  are  not  making  full  use  of  the  sentencing  ranges  and  tend  to  impose 
sentences in the bottom third or lower half of the sentencing ranges. Plea bargains continued 
to  be  widely  used  in  organised  crime  cases  and  resulted  in  sentences,  fines  and  asset 
confiscations that were disproportionally low given the gravity of the crime. Sentences in the 
context  of  plea  bargains  ranged  from  2  and  a  half  months  to  3  years  and  8  months  of 
imprisonment and fines from EUR 1 500 to EUR 50 000. Plea bargains should be used with 
care  and  should  be  regulated  by  implementing  guidelines  to  enhance  the  transparency  and 
credibility  of  the  judicial  response  to  organised  crime  and  to  provide  a  more  deterrent  and 
consistent  sanctioning  policy.  The  special  department  of  the  High  Court  dealing  with 
organised crime and high-level corruption cases has six specialised judges, handling some 65 
pending  cases,  against  more  than  500  defendants.  The  courts  are  not  able  to  handle  cases 
efficiently, owing to the insufficient human resources, critical housing conditions of the High 
Court and the numerous loopholes in the procedural rules. These shortcomings, which result 
in  frequent  adjournments,  long  trials  (up  to  5  years)  and  the  allocation  of  cases  to  non-
specialised judges need to be addressed as a matter of priority.  

As regards the cooperation between law enforcement agencies at national level, some of 
the  institutions  concerned  are  now  connected  at  a  technical  level,  which  paves  the  way  for 
automatic and secured access to each other’s data. The special prosecutors, however, still use 
paper requests to access the required data. Training and capacity building are still needed to 
make  the  system  fully  operational.  The  Asset  Recovery  Office  (ARO),  established  in  the 
police  within  the  unit  in  charge  of  international  police  cooperation,  still  lacks  access  to 
important  databases  such  as  that  of  the  Customs  Administration.  International  police 
cooperation continued to be instrumental in the fight against Montenegrin criminal groups in 
2021, as illustrated by the arrest abroad of 10 members of these groups. Some eight members 
of organised crime groups were arrested in Montenegro based on arrest warrants from foreign 
Interpol  offices  and  fugitive  searches.  Additional  police  units  were  connected  to  Europol’s 
Secure Information Exchange Network Application (SIENA) secure communication channel. 
The  number  of  communications  exchanged  with  foreign  police  services  via  the  Interpol 
global police communication system (I-24/7) and Europol (SIENA) amounted to 34 014 and 
1 334  in  2021  respectively  (down  from  48 634  and  3 998  in  2020).  Despite  fruitful 
international  police  cooperation  overall,  Montenegro  needs  to  preserve  and  consolidate  the 
trust of foreign police services by ensuring strict  control of the information flow within the 
law enforcement agencies and the prosecution service. 

Montenegro continued to cooperate with EU police services through the European Network 
of  Fugitive  Active  Search  Teams  (ENFAST),  in  which  it  has  observer  status.  The  country 
also  stepped  up  its  participation  in  EMPACT  (European  Multidisciplinary  Platform  against 
Criminal Threats). In 2022, Montenegro committed to participating in 63 operational actions 

49 

 
 
in 13 of the 15 EMPACT operational action plans, including as co-leader in four operational 
actions.  In  2021,  Montenegro  participated  in  21  EMPACT  operational  actions  and  was  co-
leader in two of them. Montenegro also appointed a National EMPACT Coordinator. 

Montenegro  continued  to  participate  actively  in  Joint  Action  Days  (JADs).  Specifically,  it 
participated  in  JAD  South  East  Europe  2021  (promoting  closer  cooperation  in  the  fight 
against firearms trafficking, the smuggling of migrants and drugs trafficking), JAD Mobile 4 
(targeting various methods of motor vehicle crime, including smuggling of stolen vehicles via 
the  external  borders,  parts  of  vehicles,  as  well  as  associated  document  fraud)  and  JAD 
Danube  6  (focused  on  combating  the  smuggling  of  migrants,  fighting  trafficking  in  human 
beings and document fraud). 

Montenegro  continued  to  actively  promote  police  cooperation  at  regional  level  during  its 
presidency  of  the  Southeast  Europe  Police  Chiefs  Association  (SEPCA)  in  2021.  A  large 
number  of  meetings,  workshops  and  assemblies  were  organised,  gathering  over  250 
participants from the SEPCA Member States. 

The  working  arrangement  between  Montenegro  and  the  European  Union  Agency  for  Law 
Enforcement  Training (CEPOL)  was  renewed in  October 2021, providing Montenegrin law 
enforcement agencies with  access  to  a  number of CEPOL’s services  and training  activities. 
The exposure of staff from the criminal department of the police to CEPOL activities should 
be strengthened.  Montenegro continues to  participate in  the CEPOL-led  Partnership against 
Crime and Terrorism project in the Western Balkans (WB PaCT), which runs until October 
2023. 

The SPO conducted 26 financial investigations into 156 people and 11 legal entities in 2021, 
a  stable  number  compared  with  the  25  financial  investigations  launched  in  2020.  In  most 
cases,  financial investigations are launched  after  the criminal  investigation, with  the aim  of 
proceeding to extended confiscation. While the use of the extended confiscation procedure is 
a  good  practice,  financial  investigations  should  be  launched  in  parallel  with  criminal 
investigations into organised or serious crime, to trace the financial flows behind the criminal 
activities. The capacity to detect and analyse illicit financial flows in crypto-currencies needs 
to be strengthened.  

The strengthened capacity of the Asset Recovery Office (ARO), established in the unit of the 
police in charge of international police cooperation, led to an increase in the number of assets 
detected and traced. In 2021, the ARO received 65 requests from foreign partners, to identify 
assets acquired through criminal activity, involving checks for 277  individuals and 31 legal 
entities.  Seven  requests  sent  by  the  ARO  to  foreign  partners  were  processed,  involving 
checks for 114 individuals and two legal entities.  

Despite this positive trend, there was no court order on final asset confiscation pronounced in 
2021  (compared  with  15  in  2020).  Two  decisions  on  temporary  seizures  were  issued, 
including  real  estate.  The  confiscation  of  assets  of  equivalent  value,  in  cases  where  the 
proceeds  of  the  crime  itself  cannot  be  found,  still  needs  to  be  inserted  into  the  legal 
framework.  Montenegro  needs  to  substantially  upgrade  its  capacity  to  trace,  detect  and 
confiscate  the  proceeds  of  crime,  in  order  to  durably  hit  the  financial  power  of  criminal 
networks. The capacity to manage seized assets and avoid the loss of their commercial value 
should also be strengthened.   

In  2021,  the  initial  track  record  on  combatting  trafficking  in  human  beings  was  further 
consolidated. The prosecution service launched four new investigations and four indictments 
were filed against six people. Two final convictions were issued, while six cases against nine 
people  are  still  ongoing.  These  cases  are  related  to  several  forms  of  trafficking,  including 

50 

 
 
forced  marriages  of  children  and  forced  begging  in  the  Roma  community.  People  in  the 
Roma  community,  in  particular  women  and  children,  remain  at  high  risk  of  trafficking  in 
human beings. In 2021 and the beginning of 2022, the Montenegrin authorities paid increased 
attention to the problem of children working and living on the street. The labour inspection 
services conducted numerous inspections of work facilities and checks on foreign workers, to 
detect  cases  of  labour  exploitation.  April  2022  saw  the  launch  of  a  new  investigation  into 
trafficking  in  human beings for the purpose of sexual  exploitation  of  young women  from  a 
third country. 

Montenegro’s  capacity  to  address  trafficking  in  human  beings  in  a  coordinated  and 
multidisciplinary  approach  continued  to  improve.  Important  training  activities  were 
conducted  for  various  professional  categories.  State  institutions  closely  cooperate  with  and 
provide  financial  support  to  civil  society  organisations  on  victim  protection  and  awareness 
raising, including the promotion of the SOS hotline. CSOs were also involved in the work of 
the coordination body  monitoring the implementation  of the  anti-trafficking strategy  and in 
the  victim  identification  team,  which  is  in  charge  of  identification,  referral  and  initial 
assistance  to  victims.  In  2021,  this  team  identified  five  victims,  all  of  which  were  minors, 
four of them girls. 

The authorities continued co-operation with neighbouring countries. In December 2021, a co-
operation  protocol  on  anti-trafficking  was  signed  between  the  interior  ministers  of 
Montenegro and Slovenia.  

Overall,  Montenegro  still  needs  to  improve  its  capacity  to  prevent  trafficking  in  human 
beings  for  all  exploitative  purposes,  and  to  identify  victims  at  an  early  stage,  especially  in 
high-risk sectors and with targeted action for particularly vulnerable groups, to reinforce the 
law enforcement response, in particular in detecting large-scale networks, and to enhance the 
support and assistance services for victims of trafficking, in particular for those belonging to 
vulnerable  communities.  A  more  robust  criminal  justice  response  to  trafficking  in  human 
beings  needs  to  be  provided,  with  shorter  legal  proceedings,  more  deterrent  sentences  and 
systematic confiscation of the proceeds of crime. Montenegro still needs to improve support 
to victims in trafficking-related trials. In the absence of specialised lawyers and proper legal 
advice, many victims do not request the free legal aid they are entitled to and do not access 
compensation. In the context of the ongoing Russian war of aggression on Ukraine and the 
arrival  of  Ukrainian  refugees  in  Montenegro,  additional  efforts  by  the  Montenegrin 
authorities are needed to prevent the risks of trafficking in human beings.  

On firearms, the ballistic laboratory, the firearms’ focal point and the police department for 
international cooperation are now connected through the TRAFFIC database, enabling checks 
of  seized  firearms  in  international  databases,  an  important  development  for  increasing  the 
efficiency  of  investigations.  However,  the  ballistic  laboratory  still  needs  to  be  accredited. 
Some 556 weapons were seized in 2021, including firearms seized at borders, and 100 final 
convictions  were  pronounced  for  smuggling  of  weapons.  However,  most  firearm-related 
cases continued to be processed as misdemeanours, while the number of cases concerning the 
illicit  cross-border  trade  of  weapons  remained  low.  Montenegro’s  Criminal  Code  does  still 
not allow the incrimination of trafficking of firearms under a specific provision, as required 
by the UN Firearms Protocol. Montenegro’s data collection and reporting system on firearms 
have yet to be standardised, for both law enforcement authorities (on arrests and seizures) and 
the judiciary (on prosecutions and convictions). Reconstruction works at the Rogame storage 
facility for small arms, light weapons and ammunition were finalised in the third quarter of 
2021 to address the safety conditions there. 

51 

 
 
Montenegro’s  involvement  within  the  goals  related  to  Western  Balkans  in  the  EU  Action 
Plan on firearms trafficking remains insufficient  and should be stepped up, in  particular on 
amendments  to  the  legal  framework,  awareness  raising,  outreach  and  education  on  the 
dangers and risks related to the misuse, illicit possession, and trafficking of firearms, as well 
as  reduction  of  illicit  firearms  through  legalisation,  voluntary  surrender,  deactivation  and 
destruction. 

The initial  track record of investigations into  money laundering continued to  improve, but 
the number of cases remained limited. In 2021, the Financial Intelligence Unit (FIU) received 
299  suspicious  transactions  reports  and  sent  62  notifications  to  law  enforcement  agencies. 
Some  18  preliminary  investigations  and  five  investigations  were  launched.  More  money 
laundering cases reached the courts, including cases where money laundering is a stand-alone 
offence. However, the number of court decisions on money laundering remained small: two 
court verdicts  were brought  against three people  in  2021, all based on plea bargains.  In the 
first  6  months  of  2022,  nine  money  laundering  cases  were  pending  before  the  courts,  of 
which four cases were stand-alone money laundering cases. The complex Atlas Bank case, in 
which  248  defendants  were  indicted  in  April  2019  for  creation  of  a  criminal  organisation, 
money  laundering  and  tax  evasion,  and  which  was  sent  back  to  the  Special  Prosecutor's 
Office, is still under further investigation. In 2022, the assessment of Montenegro within the 
fifth  round  of  regular  evaluation  by  MONEYVAL  (the  Committee  of  Experts  on  the 
Evaluation  of  Anti-Money  Laundering  Measures  and  the  Financing  of  Terrorism)  is  under 
way. 

Montenegro  continued  to  progressively  strengthen  its  capacity  in  the  area  of  cyber-crime. 
The police’s specialised hardware and software was upgraded, and the number of staff in the 
relevant  unit  increased  to  six.  However,  human  resources  are  still  far  below  the  necessary 
level to address efficiently the threats of cyber-crime and cyber-enabled crime, in a context of 
ever-increasing  global  threats.  Three  preliminary  investigations  were  launched  but  no 
investigations started. There was only one final conviction in the area of cyber-crime in 2021. 
At the end of August 2022, Montenegro suffered an unprecedented cyber-attack against the 
digital infrastructure of its public administration, which made numerous institutional websites 
and mailboxes inaccessible. The capacity of all relevant institutions should be strengthened in 
this area, including on the use of electronic evidence in court handlings, a crucial element to 
address modern forms of communication within organised crime groups. Montenegro should 
ensure  effective, proportionate and dissuasive sanctions, including for legal  persons, in  line 
with  the  relevant  EU  acquis.  Cyber-crime  offences  and  cyber  incidents  often  remain  not 
reported.  More  awareness-raising  activities  about  risks  and  threats  should  be  conducted,  to 
encourage the public to report cyber-crime offences. 

Montenegro  remains  a  member  of  the  WePROTECT  Global  Alliance  against  child  sexual 
exploitation and abuse. Montenegro’s department for cyber-crime participated in Europol’s 
Say No! campaign. A video aiming to help parents and teachers raise awareness about child 
sexual abuse was translated into the Montenegrin language.  

To  prevent  tobacco  smuggling,  the  government  announced  in  July  2021  the  future 
prohibition of the storage of tobacco products in the free zone of the Port of Bar, through the 
revocation,  amendment  or  non-extension  of  contracts  with  operators  in  the  free  zone.  The 
decision set deadlines for operators to remove their tobacco products from the free zone. At 
the same time, strengthened customs supervision measures were put in place at the entry and 
exit  of  the  free  zone.  However,  substantial  thefts  of  tobacco  products  took  place  in  this 
context,  with  tobacco  products  worth  over  EUR 10  million  stolen  from  hangars  in  the  free 
zone  between  December  and  March  2022.  The  customs  authorities  uncovered  a  smuggling 

52 

 
 
network in February 2022 and suspended seven customs officers working in the port, after a 
large  quantity  of  cigarettes  disappeared  from  one  of  the  warehouses.  In  June  2022,  a  joint 
action of the police and the customs authorities led to the seizure of eight shipping containers 
carrying 4 000 packs of cigarettes worth nearly EUR 3.5 million. After the deadlines set for 
the  removal  of  tobacco  products  expired,  the  Montenegrin  authorities  seized  in  May  2022 
145 000  master  cases  (equivalent  to  almost  1.5  billion  cigarettes,  worth  at  least  EUR 25 
million)  left  on  the  spot  by  their  owners.  They  further  discovered  a  hidden  warehouse 
containing  cigarettes  worth  EUR  850 000  in  June  2022.  The  Montenegrin  authorities  are 
exploring the possibility of putting the seized cigarettes on the market. However, the sale of 
tobacco products of unknown origin would be of severe concern as it would not be aligned 
with the EU acquis on tobacco control and would pose serious risks of further smuggling of 
the goods into the EU market. In August 2022, a smaller batch of 1,500 boxes of cigarettes 
originating from an earlier seizure was destroyed. 

A clear increase in preliminary investigations and investigations was observed in 2021, with 
39 criminal charges filed regarding 47 individuals and 3 legal entities. Five cases related to 
organised tobacco smuggling were pending before the courts in 2021. However, the number 
of  final  convictions  remained  low,  with  only  one  final  sentence  pronounced  in  2021  for 
tobacco  smuggling  associated  with  organised  crime,  based  on  a  plea  bargain  agreement. 
Montenegro  needs  more  robust  efforts  to  address  the  illicit  trade  of  cigarettes  including 
through  a  strengthened  cooperation  with  EU  competent  agencies.  This  would  involve 
strengthening  the  capacity  of  all  institutions  involved,  enhancing  the  work  of  the  whole 
judicial  chain,  dismantling  the  criminal  networks,  and  increasing  the  track  record  of  final 
convictions and confiscations of the proceeds of crime. 

On  witness  protection,  the  protection  measures  applied  to  seven  people  in  2020  were 
extended  in  2021.  In  cases  falling  under  the  competence  of  the  SPO,  no  extra-judicial 
protection measures were implemented in 2021 (compared with 25 in 2020). At the request of 
the  International  Criminal  Court  in  The  Hague  (ICC),  measures  of  protection  and  support 
were implemented for nine people. 

Cooperation in the field of drugs 

Institutional set-up and legal alignment 

Montenegro’s  legal  framework  in  this  area  is  not  fully  aligned  with  the  EU  acquis.  The 
national  drug  information  system  does  not  fully  meet  EU  standards.  A  new  Directorate  for 
the Prevention of Drug  Abuse was created in the Ministry of Health, in which the National 
Drug Observatory (NDO) is embedded, following its removal from the Ministry in February 
2021.  The  Observatory,  however,  has  not  addressed  recommendations  from  the  European 
Commission’s  previous  annual  reports  nor  has  it  participated  in  the  different  training  and 
capacity building exercises organised by the EMCDDA since 2021. The NDO still does not 
have sufficient capacity and budget autonomy to meet EU standards, and does not sufficiently 
fulfil  its  coordination  function.  The  Institute  of  Public  Health,  the  forensic  laboratory  and 
other institutions (including NGOs) dealing with drug-related issues have good technical and 
scientific capacity. However, security-related data collection on drugs is not compliant with 
the  EU  standards  and  the  related  security-related  national  data  sets  are  not  provided  to  the 
European  Monitoring  Centre  for  Drugs  and  Drug  Addiction  (EMCDDA)  in  the  requested 
form  and  timelines.  The  Observatory  has  still  to  become  an  authoritative  source  of 
information  that  prepares  regular  national  reports  on  drugs  in  Montenegro  and  provides 
evidence-based information for drug-related national policies. 

53 

 
 
In  October  2021,  Montenegro  reported  to  the  EU  early  warning  system  on  a  new 
psychoactive substance identified by the forensic centre.  The national early warning system 
(NEWS)  is  still  not  ready  to  be  linked  to  the  EU  early  warning  system,  as  it  has  limited 
operational capacity, lacks defined procedures and sufficient involvement of law enforcement 
and health authorities. A new strategy for the prevention of drug abuse has yet to be adopted, 
as the previous one came to an end in 2020.  

Implementation and enforcement capacity 

Montenegro continued to be a transit country for drugs, as a part of the Balkan route. In 2021, 
the  Special  State  Prosecutor's  Office  conducted  nine  investigations  into  drug  smuggling,  of 
which  five  were  international  investigations  conducted  with  foreign  police  services.  This 
resulted  in  the  unprecedented  amount  of  4.7  tonnes  of  drugs  seized  in  the  country  in  2021 
(compared with 3.1 tonnes in 2020 and 2.4 tonnes in 2019), mainly marijuana (3.4 tonnes), 
but  also  a  significant  quantity  of  cocaine  (1.2  tonnes),  along  with  heroin  and  synthetic 
substances.  In  August  2021,  the  police  seized  more  than  one  tonne  of  cocaine,  hidden  in  a 
shipment of bananas. The movement of the drug shipment had been monitored from a vessel 
in the Port of Bar to the end destination in a storage facility near Podgorica. Two people were 
arrested  and  are  under  investigation.  A  large  illegal  marijuana  plantation  of  860  cannabis 
stalks  was  detected,  leading  to  the  arrest  of  three  Albanian  citizens.  Another  plantation  of 
1 300  seedlings  cannabis  was  found,  but  the  perpetrators  were  not  discovered.  The  courts 
issued seven convictions for drug smuggling associated with organised crime in 2021 (down 
from eight in 2020), all of them based on plea bargains.  

In the first quarter of 2022, 15 final convictions were handed down in drug-related cases. Ten 
cases of drug trafficking at international level were pending before the courts, involving 58 
people.  

The  insufficient  storage  capacity  for  seized  drugs  has  yet  to  be  addressed.  Montenegro  has 
not amended the relevant legal provisions in the Criminal Procedure Code to make it possible 
to keep only a sample of psychoactive substances as evidence for court proceedings, and not 
the entire amount, as it is the case now. 

Fight against terrorism 

Institutional set-up and legal alignment 

Montenegro’s legal framework is largely aligned with the EU acquis. However, the Law on 
international restrictive measures (a crucial piece of legislation in the context of international 
and  EU  sanctions)  has  yet  to  be  aligned  with  EU  standards,  in  line  with  the  European 
Commission’s  recommendations  from  early  2019.  The  current  law  does  not  address  the 
application of sanctions beyond restrictive measures against terrorists, terrorist organisations 
and  terrorist  financiers.  Further  to  the  war  of  aggression  of  Russia  against  Ukraine, 
Montenegro  adopted  in  April  2022  a  separate  package  of  restrictive  measures,  targeting 
Russian nationals,  financial institutions  and properties. A coordination body monitoring the 
introduction  and  implementation  of  international  restrictive  measures  was  established.  A 
number of sanctions adopted by the EU remain to be implemented. 

Montenegro has yet to adopt a law on the processing of data on passengers in air transport in 
order  to  prevent  and  detect  criminal  acts  of  terrorism  and  other  serious  crimes,  and  to 
establish  a  legal  framework  regulating  terrorist  content  online.  Occurrences  of  right-wing 
extremist content on-line are on the rise  in  the context  of national  and international  events. 
More  efforts  are  needed  to  prevent  all  forms  of  radicalisation  and  violent  extremism, 
including right-wing extremism and ethno-nationalism. 

54 

 
 
Further to the change of government in April 2022, Montenegro still needs to appoint a new 
national  coordinator  for  the  two  key  strategies  in  this  area  (on  counter-terrorism  and  on 
prevention of violent extremism).  

Further to the signature in November 2019 of the arrangement to implement the Joint Action 
Plan on counter-terrorism for the Western Balkans with the EU, Montenegro continued to 
implement the planned measures. However, it has not submitted yet its fourth report on the 
implementation of the arrangement. 

Implementation and enforcement capacity 

The threats of terrorism and violent extremism remained relatively low in the country. There 
were no new departures or returns of Montenegrin citizens to and from foreign battlefields in 
2021. One criminal charge for terrorism was issued against one person, in the context of the 
protest against the enthronement of Joanikije II, the Metropolitan of Montenegro, in Cetinje 
in  September  2021.  An  initial  track  record  of  investigations  into  terrorism  financing  and 
suspected  links  to  terrorism  was  developed.  The  re-trial  of  the  13  defendants  (including  2 
Russian and 8 Serbian citizens) found guilty of terrorism in the 2016 coup attempt case is still 
on-going after the first-instance judgment was revoked by the Appeal Court and returned to 
the High Court.  

There  are  currently  no  people  convicted  of  terrorism  offences  in  Montenegrin  prisons.  The 
prison administration continued to participate in several projects strengthening its capacity to 
prevent violent extremism and radicalisation. Montenegro continued to participate in the EU 
Radicalisation Awareness Networks (RAN) to support and enhance community engagement, 
and in various international projects providing capacity building in the prevention of violent 
extremism  and  radicalisation.  A  network  of  local  focal  points  for  the  prevention  of  violent 
extremism is formally in place throughout the country but should become more proactive in 
prevention activities.  

Montenegro  continued  to  cooperate  closely  with  Interpol  and  Europol,  contributed  to  the 
Terrorism  Risk  Assessment  and  Analysis  for  the  Western Balkans  and  submitted  data  to 
Europol for the preparation of the Terrorism Situation and Trend Report (TE-SAT). The use 
of Europol tools and products for the fight against terrorism continued to increase. In 2021, 
some 203 messages were exchanged with  foreign  counter-terrorism  units through Europol's 
SIENA  communication  link.  Montenegro  actively  participated  in  the  Western  Balkan 
Regional Counterterrorism Initiative on counter-terrorism investigations. 

Montenegro’s threat assessment still needs to be conducted in a more analytical and inclusive 
way, to  create a common understanding of the  main threats  and risks among the concerned 
stakeholders, with special attention to hybrid and cyber threats.  

Judicial cooperation in civil and criminal matters  

Montenegro’s legal framework on judicial cooperation in criminal matters is largely aligned 
with  the  EU  acquis.  Montenegro  continued  to  align  its  legislation  with  the  EU  acquis  on 
international  judicial cooperation but  has  yet  to  become a party to  the 2007 Protocol  to  the 
Hague Convention on  International  Recovery of  Child  Support  and  Other  Forms of  Family 
Maintenance,  and  to  the  2000  Hague  Convention  on  the  International  Protection  of  Adults. 
Montenegro  has  also  not  ratified  the  2019  Hague  Convention  on  the  Recognition  and 
Enforcement of Foreign Judgments in Civil or Commercial Matters.  An internet application 
allowing  the  exchange  of  cases  of  international  legal  assistance  between  the  prosecution 
service and the Ministry of Justice was established. 

55 

 
 
There  was  a  slight  increase  in  the  volume  of  judicial  cooperation  compared  with  2020, 
though  it  remained  lower  than  before  COVID-19  levels.  Some  843  cases  of  mutual  legal 
assistance  in  criminal  matters  were  processed  in  2021  (784  in  2020)  and  701  cases  in  civil 
matters (671 in  2020). The main partners continued to  be the Western  Balkans and the EU 
Member States.   

Eurojust  and  Montenegro  signed  a  cooperation  agreement  in  May  2016,  with  the  liaison 
prosecutor taking up duties in December 2017. Liaison prosecutors play an important role in 
facilitating  ongoing  investigations  into  serious  cross-border  organised  crime  and  terrorism, 
given  the  increased  number  of  cases  that  have  connections  with  the  Western  Balkans. 
Montenegro’s  cooperation  with  Eurojust  continued.  Some  17  cases  involving  Montenegro 
were  opened  in  Eurojust  in  2021  (from  23  in  2020),  including  three  cases  launched  by 
Montenegro. A working arrangement with the European Public Prosecutor’s Office (EPPO) 
was signed in September 2022. 

In  September  2021,  Montenegro  concluded  for  the  first  time  an  agreement  with  a  third 
country (the Republic of Moldova) to establish a joint investigation team on a common drug 
trafficking and money laundering case, enabling coordinated searches, arrests and seizures in 
both countries. The joint investigation team was supported by the IPA II project ‘Countering 
Serious Crime in the Western Balkans’. 

Legal and irregular migration 

Institutional set-up and legal alignment 

Montenegro’s  legal  framework  on  legal  and  irregular  migration  is  largely  aligned  with  the 
EU acquis. The 2021-2025 strategy on migration and reintegration of returnees was adopted 
in September 2021, aligning the policy framework with the EU acquis and best practices on 
legal  migration,  asylum,  and  prevention  of  irregular  migration,  readmission,  return, 
integration, internally displaced persons (IDPs) and statelessness.  In June 2022, Montenegro 
joined  the  European  Migration  Network  (EMN),  an  EU  network  of  migration  and  asylum 
experts,  as  a  non-voting  observer  member.  Montenegro  still  has  to  nominate  a  national 
contact point.   

Montenegro concluded a readmission agreement with the EU and 15 implementing protocols 
on  readmission  with  EU  Member  States.  In  October  2021,  a  readmission  agreement  with 
Georgia  was  signed,  bringing  to  12  the  number  of  readmission  agreements  with  third 
countries.  The  diplomatic  steps  initiated  in  2019  towards  Pakistan,  Morocco,  Iraq,  Iran, 
Algeria  and  Bangladesh  for  negotiating  readmission  agreements  were  renewed  in  2021  but 
remained  unanswered  so  far.  Negotiations  of  a  readmission  agreement  with  Ukraine  have 
started.   

Implementation and enforcement capacity  

Both legal and irregular migration remained at relatively low levels in 2021 compared to the 
levels  before  the  COVID-19  pandemic.  There  was  nevertheless  an  upward  trend  in  legal 
labour  migration  compared  with  2021,  which  benefited  from  higher  demand  in  the  tourism 
and construction sectors. Some 38 676 temporary residence and work permits were issued (up 
from 34 755 in 2020). 

The number of migrants registered on the territory of Montenegro in 2021 slightly increased 
(3 405  migrants  compared  with  3 149  in  2020).  A  large  majority  of  them  were  Afghan, 
Moroccan,  Bangladeshi  and  Iran  nationals.  The  main  migration  routes  through  the  country, 
from  the  Albanian  border  to  Bosnia  and  Herzegovina  (less  often  to  Croatia  and  Serbia) 
remained unchanged. From August to November 2021, the army was once again called in to 

56 

 
 
support the border police at the border with Albania. The Montenegrin authorities prevented 
834 illegal border crossings in 2021 (293 in 2020).  

There  was  no  new  investigation  ordered  by  the  Special  Prosecutor’s  Office  into  migrant 
smuggling  in  2021.  Some  104  migrants,  mainly  from  Serbia,  Türkiye  and  Kosovo,  were 
detained in the detention centre for foreigners in Spuž.  

Secondary  movements  sharply  decreased  from  2020.  In  2021,  Montenegro  readmitted  104 
third-country  nationals  from  neighbouring  countries  under  bilateral  readmission  agreements 
(312 in 2020), mainly from Bosnia and Herzegovina (66). Readmission from Montenegro to 
neighbouring countries decreased to 60 people (from 245 in 2020).  

In  2021,  the  number  of  voluntary  returns  from  Montenegro  increased  to  36  people  (10  in 
2020  and  41  in  2019).  Some  30  returns  to  neighbouring  countries  were  processed  by  the 
border  police  and  6  returns  to  countries  of  origin  by  the  International  Organisation  for 
Migration.  Notwithstanding  the  existing  administrative  obstacles  (absence  of  consular 
missions of countries of origin in Montenegro), a more proactive voluntary return policy for 
those with no right to stay should be developed and necessary funds should be allocated. 

The  EU-Montenegro  readmission  agreement  and  its  15  implementing  protocols  with  EU 
Member States  continued to  be implemented satisfactorily, with  the number of readmission 
requests  from  EU  Member  States  and  Schengen  associated  countries  continuing  to  decline 
(153  requests  for  readmission  of  238  people  in  2021,  of  which  78  requests  were  answered 
positively).  Institutional  capacities  for  the  reintegration  of  Montenegrin  citizens  returned  to 
Montenegro  under  a  readmission  procedure  were  strengthened  both  at  central  and  local 
levels,  through  a  multidisciplinary  approach  and  cooperation  with  NGOs.  However, 
integration problems persist, such as school enrolment of returned children without a school 
background and access to jobs. 

Montenegro  still  does  not  have  a  modern  migrant  fingerprinting  identification  and 
registration system connected to a central biometric database. Instead, migrants’ fingerprints 
are  collected  using  ink  on  paper.  A  masterplan  laying  down  the  technical  requirements  for 
setting up a modern system was drafted in close cooperation with  the European Border and 
Coast  Guard  Agency  (Frontex).  However,  significant  investments  are  needed  to  actually 
establish  the  system  (a  crucial  tool  for  the  exchange  of  migrant  biometric  data  between 
Montenegro’s key institutions) and to eventually connect it to Eurodac upon accession. 

Montenegro  must  continue  its  efforts  to  cope  with  migratory  pressure,  by  developing  its 
international cooperation on readmission, supporting the successful reintegration of returnees, 
raising  its  capacity  to  prosecute  migrant  smuggling  networks  and  by  setting  up  a  modern 
migrant data collection system, compatible with Eurodac. 

Asylum 

Institutional set-up and legal alignment 

Montenegro’s  legal  framework  on  asylum  is  largely  aligned  with  the  EU  acquis.  The 
necessary institutions are in place to handle asylum applications. A cooperation roadmap with 
the  European  Asylum  Support  Office  (now  the  EU  Agency  for  Asylum)  was  signed  in 
December  2021.  The  roadmap  is  intended  to  strengthen  Montenegro’s  asylum  system, 
including  the  status  determination  procedure,  the  reception  conditions,  and  to  develop 
contingency planning.  

 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. 

57 

 
 
                                                           
In  2021,  Montenegro  hosted  42  people  with  international  protection  status  (37  in  2020),  of 
which  8  were  employed.  The  main  countries  of  origin  are  Afghanistan,  Morocco,  Iran  and 
Pakistan.  The  assistance  package  includes  financial  assistance,  access  to  healthcare, 
education,  employment,  free  legal  aid,  language  courses  and  psychosocial  assistance. 
Accommodation is provided for 2 years (with the support of the UNHCR). However, access 
to  jobs  and  the  relevant  social  services,  and  the  proper  acquisition  of  the  Montenegrin 
language  remain  key  challenges  for  people  under  international  protection.  Asylum  seekers 
have no right  to  open bank accounts,  creating  additional difficulties in  their daily lives and 
hindering access to employment. 

On 10 March 2022, Montenegro adopted a decision granting a one-year temporary protection 
to people fleeing the Russian war of aggression on Ukraine, similar to the activation by the 
EU  of  the  Temporary  Protection  Directive.  A  coordination  body  was  set  up  to  monitor  its 
implementation.  The  revision  of  Montenegro’s  contingency  planning  in  case  of  a  massive 
influx  is  under  way,  with  the  support  of  the  EU  Agency  for  Asylum  (EUAA).  Some 
EUR 2 million from the state budget were allocated to the Ministry of Interior to provide an 
emergency response to the influx of refugees from Ukraine. 

Implementation and enforcement capacity 

Montenegro  hosted  5 301  Ukrainian  nationals  at  the  beginning  of  the  Russian  war  of 
aggression  against  Ukraine  on  24 February,  2 148  on  the  basis  of  a  residence  permit  and 
3 153  as  tourists.  Between  1 March  and  5 June,  24 016  Ukrainian  nationals  entered  the 
country  and  16 398  left  it.  Some  5 552  Ukrainians,  of  whom  two  thirds  are  women  or 
children,  had  registered  under  the  temporary  protection  mechanism  by  17 June  2022. 
Ukrainian refugees  are  mainly  residing in  private accommodation, mainly  along the coastal 
area,  either  for  free  or  paying  a  low  amount  of  rent.  A  more  coordinated  middle  and  long-
term  response  needs  to  be  provided,  with  the  support  of  the  EUAA.  In  proportional  terms, 
Montenegro  is  the  Western  Balkan  partner  the  most  impacted  by  the  influx  of  Ukrainian 
refugees, with the number of refugees exceeding 1 % of its population.  

The higher number of migrants entering the country in 2021 was reflected in a higher number 
of asylum requests. In 2021, 3 342 migrants expressed their intention to request asylum (an 
18 %  increase  from  2020),  thus  completing  the  first  step  of  the  asylum  procedure.  Afghan 
nationals  formed  the  largest  group  even  before  the  change  of  regime  in  Kabul,  and  their 
numbers  increased  after  it.  Although  the  registration  of  intentions  to  request  international 
protection is possible on the whole territory of Montenegro, it takes place mainly at the Božaj 
migrant  centre  near  the  border  with  Albania,  as  the  centre  has  the  necessary  equipment  for 
collecting  fingerprints  and  taking  photographs  of  applicants  in  line  with  the  procedures  in 
force. 

The number of asylum applications, however, drastically fell compared with previous years. 
In  2021,  only  272  people  -  or  8 %  of  those  who  declared  an  intention  to  request  asylum  - 
eventually lodged an asylum request, which is 50 % less than in 2020. Moroccan nationals, 
followed by Algerian, Iranian and Afghan nationals made most of the requests lodged. Legal 
counselling  provided  by  NGOs  is  available  to  asylum  seekers,  as  well  as  interpretation  in 
several  languages,  provided  by  the  Asylum  Directorate.  Most  of  the  applicants  left  the 
country before the end of the procedure. Out of 63 interviews conducted, 14 asylum seekers 
received  international  protection  status  in  2021.  Six  more  people  were  granted  a  protection 
status in the first 6 months of 2022. They all benefit from an integration plan.  

The processing time for asylum applications, which in previous years often lasted more than 
the  regular  6-month  timeline  and  sometimes  even  exceeded  the  exceptional  timeline  of  21 

58 

 
 
months, was reduced, addressing a recommendation from the European Commission’s 2021 
Montenegro report. Some cases continued to require a longer time, due to the limited number 
of staff  in  charge of processing the  applications  (8 staff members).   Montenegro’s  capacity 
with regard to the status determination procedure still needs to be strengthened, in particular 
on the country of origin information and on key legal concepts such as the safe third country, 
to  improve  the  country’s  ability  to  deal  with  complex  cases.  The  Administrative  Court 
received  25  appeal  claims  against  the  decisions  of  the  Asylum  Directorate,  as  a  result  of 
which 4 negative decisions were annulled.  

A total of 2 688 migrants were accommodated in the country’s reception centres in 2021 (a 
stable  number  compared  with  2 702  in  2020)  including  750  women  and  764  children.  This 
reflects  a  change  in  the  profile  of  asylum  seekers,  which  now  includes  a  large  number  of 
families. The total reception capacity for asylum seekers stands at 189 beds, including 25 in a 
centre  for  unaccompanied  children  that  is  not  devoted  exclusively  to  migrant  children.  The 
on-going  projects  aimed  at  increasing  the  reception  capacity  by  expanding  the  existing 
premises  are  not  finalised  yet.  The  planned  reconstruction  works  aimed  at  increasing  the 
capacity of the Božaj migrant centre, with the financial support of the European Union, did 
not  start.  The  authorities  continued  to  cooperate  closely  with  NGOs  such  as  the  Red  Cross 
and the local association of psychologists for the provision of health, psychological assistance 
and  other  services  in  the  migrant  centres.  However,  Montenegro’s  reliance  on  international 
donors’ assistance for the provision of services in the centres remains significant.  

Montenegro  still  needs  to  consolidate  it  asylum  system  by  increasing  its  reception  capacity 
for  asylum  seekers  as  a  matter  of  priority,  improving  the  status  determination  procedure, 
establishing  an  integrated  service  system  for  asylum  seekers  and  enhancing  the  integration 
measures for people under international protection. Better preparedness for sudden influx and 
emergency  situations,  similar  to  the  recent  influx  of  Ukrainians  refugees,  should  be 
developed with the support of the EUAA. 

Visa policy 

Montenegro’s  visa  policy  is  still  not  fully  aligned  with  the  EU  list  of  countries  whose 
nationals require a visa to the EU. On the contrary, in 2021 and early 2022, Montenegro has 
deviated  further  away  from  the  recommended  alignment.  In  May  2022,  the  government 
granted  a  temporary  visa  exemption  to  nationals  of  Saudi  Arabia,  valid  from  June  to 
September, with the aim of making up for the decrease in tourists coming from Russia and 
Ukraine.  In  total,  nationals  from  13  countries  -  Armenia,  Kazakhstan,  Russia,  Azerbaijan, 
Belarus,  China,  Cuba,  Ecuador,  Kuwait,  Türkiye,  Qatar,  Kosovo  and  Saudi  Arabia  -  are 
exempted  from  short-stay  visa  requirements,  either  on  a  seasonal  basis  or  permanently. 
Seasonal visa exemption measures are not in line with the EU acquis, and these countries are 
on the EU list of countries whose citizens require a visa for the EU.  In addition, foreigners 
having  a  residence  permit  in  the  United  Arab  Emirates  (UAE)  may  enter  Montenegro  and 
stay in the country for up to 10 days without a visa. Several occurrences of abuse of this visa 
regime  were  detected  by  Montenegrin  authorities.  Montenegro  should  ensure  increased 
alignment of its visa policy with the EU list of visa-required third countries. 

Under  the  post-visa  liberalisation  process,  Montenegro  continued  to  implement  relevant 
measures  to  prevent  the  abuse  of  the  visa-free  regime  with  the  EU  and  reported  on  it  on  a 
monthly basis. After years of continuous decrease, the number of first-time asylum applicants 
from  Montenegro  in  EU  Member  States  and  Schengen  associated  countries  increased  in 
2021, with 250 applications lodged in 2021 compared with 140 applications lodged in 2020. 

Montenegro has 31 consular missions connected through its national visa information system.  

59 

 
 
In  December  2021,  Montenegro  decided  to  extend  the  duration  of  its  investor  citizenship 
programme  (‘Special  Investment  Program  of  Special  Importance  for  the  Industry  and 
Economic  Interest  of Montenegro’) for an additional 12 months until December 2022. This 
was  despite  the  previously  announced  commitment  to  end  the  programme  in  2021,  and 
despite the Commission’s recommendations to phase the programme out as soon as possible, 
both in the European Commission’s 2021 Montenegro report and the fourth report under the 
visa suspension mechanism. In March 2022, the Ministry of Interior adopted stricter internal 
and  external  checks  for  all  applications,  which  resulted  in  freezing  the  process  of  pending 
applications for the time being.  In May 2022, Montenegro established additional checks for 
applicants from Russia and Belarus and initiated a procedure to revoke the citizenship of any 
person  who  had  been  granted  citizenship  under  the  programme  and  is  on  the  list  of 
individuals  under  international  restrictive  measures.  However,  no  such  case  has  been 
identified so far. In June 2022, Montenegro lowered the financial criteria for applying to the 
programme.  A  bank  guarantee  amounting  to  EUR 1  million  is  now  required,  instead  of 
EUR 2.5  million  previously.  The  amendments  also  allowed  the  beneficiaries  of  the 
programme  to  add  children  born  after  the  submission  of  the  request  to  the  list  of  family 
members granted citizenship.  

Between January 2019 and May 2022, 934 applications have been lodged (279 applicants and 
655 family members); 409 applications have been accepted and 3 applications rejected, and 
522 applications are being evaluated (152 applicants and 370 family members). In total, 333 
Montenegrin  passports  have  been  issued  under  the  programme  since  its  establishment  in 
January 2019 (69 of which during the four months of 2022). More than 70% of the passports 
issued were granted to citizens of the Russian Federation. This programme poses risks such 
as  money  laundering,  tax  evasion,  terrorism  financing,  corruption  and  infiltration  of 
organised crime and should be terminated. 

Schengen and external borders 

Institutional set-up and legal alignment 

Montenegro’s  legal  framework  is  largely  aligned  with  the  EU  acquis  in  this  area.  The 
constructive cooperation with the European Border and Coast Guard Agency (Frontex) under 
Montenegro’s  Status  Agreement with  the European Union continued to  yield results and to 
strengthen the capacities of Montenegro’s border police. Under the status agreement with the 
European  Union,  Frontex  officers  with  executive  powers  are  deployed  at  a  border  crossing 
point  with  Croatia  and  at  the  National  Coordination  Centre  in  Podgorica.  In  addition,  the 
Police Directorate of Montenegro has had a working arrangement with  Frontex since 2009, 
under  which  Frontex  officers  without  executive  powers  are  deployed  to  the  country’s  two 
international airports and its border crossing points with neighbouring third countries.  

In  addition,  a  joint  maritime  operation  to  strengthen  blue  borders’  surveillance  is  being 
conducted, the first fully-fledged maritime joint operation implemented by Frontex in a non-
EU  country.  Cooperation also takes  place through WB-RAN (Western  Balkans Risk Analysis 
Network), within which Frontex and WB RAN member states prepare an annual risk analysis for 
the  Western  Balkans.  Data  is  exchanged  through  the  WB  RAN  network  on  a  daily  basis, 
providing a picture of migrant movements along the Western Balkans routes.   

Montenegro cooperates actively with Europol and Interpol on countering cross-border criminal 
activities,  including  through  Europol’s  European  Migrant  Smuggling  Centre  (EMSC). 
Montenegro  conducted  joint  cross-border  police  operations  through  its  participation  in  the 
European Multidisciplinary Platform against Criminal Threats (EMPACT) and during the 2-week 
Mobile 4 Joint Action Day Operation.  

60 

 
 
The  situational  awareness  and  reaction  capacity  of  the  border  police  has  significantly 
increased  since  the  establishment  of  a  coordination  centre  in  2019.  The  authorities  of 
Montenegro  are  aiming  to  upgrade  this  structure  to  a  fully-fledged  National  Coordination 
Centre  (NCC)  compatible  with  Eurosur,  including  through  close  cooperation  with  Frontex. 
The  coordination  centre  is  connected  to  NCCs  of  Adriatic  Sea  countries,  within  a  network 
exchanging operational information on suspicious and stolen boats. Two representatives of the 
coordination centre are deployed to Frontex headquarters in Warsaw as part of the SEA 2022 
joint  operations.  Eleven  border crossing points are now connected to  this  centre,  while two 
remain  to  be  connected.  However,  some  equipment  and  connections  to  other  national 
surveillance  systems  are  still  needed  to  ensure  full  coverage  of  critical  areas  and  larger 
premises are needed to ensure full functioning of the centre.   

The  number  of  job  positions  in  the  border  police  is  1 346,  of  which  1 307  have  been 
recruited. According to the Schengen action plan, 650 more border police officers would be 
needed. This lack of staff poses critical challenges in the field and triggers the regular use of 
the army to supplement the border police for border surveillance functions.  

Montenegro  continued  to  implement  its  strategy  on  integrated  border  management  and  its 
Schengen  action  plan.  Border  management  equipment  continued  to  be  progressively 
upgraded in accordance with the Schengen action plan, but reliance on EU and other donors’ 
support  remained  high.  Substantial  further  upgrades  are  needed  to  cope  with  operational 
challenges  and  to  improve  surveillance  of  blue  and  green  borders.  Monitoring  of  the 
implementation  of  the  Schengen  action  plan  relating  to  equipment  should  be  improved  in 
order  to  prioritise  the  purchases.  A  capability  development  planning  system  is  also  lacking 
and  there  is  no  long-term  plan  on  the  development  of  human  resources.  The  Ministry  of 
Interior conducted an analysis of the Schengen action plan to initiate a strategic reflection on 
updating it, as the current one was adopted in 2017. 

The  border  police’s  cooperation  with  the  customs  and  the  criminal  police  is  improving. 
However,  the  border  police’s  insufficient  autonomy  in  criminal  investigations  hampers  the 
development of its analytical capacities and intelligence on smuggling networks. Montenegro 
has yet to establish an operational Advance Passenger Information System (API). 

Implementation and enforcement capacity 

Some 4 018 migrants were prevented from illegally entering or exiting Montenegro in 2021. 
Some  71  stolen  vehicles  were  found  based  on  Interpol  warrants,  as  well  as  927  targeted 
people (both thanks to  Interpol databases  and national  arrest  warrants) and 203 documents. 
Some 64 forged documents were seized.  

The  number  of  border  patrols  on  land  and  water  increased,  but  the  number  of  joint  border 
patrols with neighbouring countries remained low in the context of the pandemic, with only 
437 joint patrols conducted in 2021 (723 in 2020), including 341 joint patrols on the border 
with Albania (570 in 2020). The activity of the Joint Police Cooperation Centres increased, 
with a higher volume of information exchanged.  

Montenegro continues to develop its cooperation with neighbouring Western Balkan partners 
within bilateral border traffic agreements. A new joint border crossing point with Albania at 
Zatrijebačka Cijevna-Grabon was opened with the financial support of the European Union. 
While the demolition of 29 cross-border alternative roads with Serbia, agreed in March 2019, 
has been completed on the Montenegrin side, 15 alternative roads to Serbia and 13 roads to 
Bosnia and Herzegovina still need to be demolished. 

61 

 
 
 
2.3. ECONOMIC CRITERIA 

In  line  with  the  conclusions  of  the  European  Council  in  Copenhagen  in  June  1993,  EU 
accession requires the existence of  a functioning market  economy and the capacity to  cope 
with competitive pressure and market forces within the Union. 

Economic  governance  has  become  even  more  central  in  the  enlargement  process  in  recent 
years.  The  Commission's  monitoring  takes  place  in  two  processes:  the  Economic  Reform 
Programme exercise and the below assessment of compliance with the economic criteria for 
accession.  Each  enlargement  country  prepares  an  Economic  Reform  Programme  (ERP) 
annually,  which  sets  out  a  medium-term  macro-fiscal  policy  framework  and  a  structural 
reform  agenda  aimed  at  ensuring  competitiveness  and  inclusive  growth.  The  ERPs  are  the 
basis for country-specific policy guidance jointly adopted by the EU and the Western Balkans 
and Türkiye at ministerial level in May each year. 

2.3.1. The existence of a functioning market economy 

Montenegro  has  made  good  progress  and  is  moderately  prepared  in  developing  a 
functioning  market  economy.  After  experiencing  a  sharp  recession  in  2020,  the  economy 
recorded a strong rebound in 2021 and kept growing at a steady pace in the first half of 2022, 
as  the  removal  of  COVID-19  restrictions  buoyed  both  domestic  and  external  demand.  The 
economic  recovery  and  rapidly  rising  inflation  led  to  surging  revenues  and  a  very  large 
improvement in the budget balance. The fallout from Russia’s war against Ukraine has been 
limited  so  far,  notwithstanding  these  two  countries’  very  important  contribution  to 
Montenegro’s  tourism  in  the  past.  Driven  by  surging  global  commodity  prices,  inflation 
increased  significantly.  The  government  adopted  an  ambitious  fiscal  reform  programme 
(called ‘Europe Now’), to support the post-pandemic recovery while providing fiscal stimulus 
measures  easing  the  burden  on  households  from  rising  energy  and  food  prices.  External 
imbalances  decreased  significantly  thanks  to  the  rebound  of  tourism,  while  the  situation  of 

62 

Table 2.1:201920202021Montenegro - Key economic figuresGDP per capita (% of EU-27 in PPS)1)44504547Real GDP growth 3.64.1-15.312.4Economic activity rate of the population aged 15-64 (%), total1)62.566.261.559.2      female55.859.154.752.9      male69.073.368.365.5Unemployment rate of the population aged 15-64 (%), total1)17.615.418.316.8      female17.515.918.816.1      male17.715.017.817.3Employment of the population aged 15-64 (annual growth %)2.72.6-10.1-2.4Nominal wages (annual growth %)0.90.81.31.4Consumer price index (annual growth %)1.40.5-0.82.5Exchange rate against EUR1.01.01.01.0Current account balance (% of GDP)-14.0-14.3-26.1-9.2Net foreign direct investment, FDI (% of GDP)10.76.211.211.2General government balance (% of GDP)-4.8-2.0-11.1-1.9General government debt (% of GDP)62.976.5105.384.8Notes: 1) EurostatSource: national sources2013-18 average 
 
 
the labour market started to improve even if structural problems persist. The banking system 
remained  stable,  and  non-performing  loans  did  not  increase  significantly  in  2022  after  the 
loan moratorium adopted in the context of the COVID-19 crisis expired in 2021. However, 
close  supervision  is  needed  to  monitor  and  address  risks  in  view  of  tightening  financing 
conditions. 

Last  year’s  recommendations  were  partially  addressed.  In  the  coming  year,  in  order  to 
improve the functioning of the market economy, Montenegro should in particular: 

  once  the  recovery  is  entrenched,  implement  a  medium-term  fiscal  consolidation  plan 

targeting further public debt reduction; 

  strengthen fiscal governance by setting up an independent body for fiscal oversight; 

  adopt a strategic plan to perform an analysis of all state-owned enterprises and prepare a 

proposal for the optimal portfolio of state ownership; 

  develop and implement concrete measures to reduce the informal economy. 

Economic governance 

A  broad  consensus  was  maintained  on  key  economic  policy 
fundamentals 
notwithstanding changes of government. The last two governments reaffirmed their strong 
commitment  to  the  EU  path  and  related  economic  reforms.  Important  elements  were  the 
support to further diversify the economy according to a smart specialisation strategy based on 
partnerships  between  businesses,  public  entities  and  academia,  and  the  continuation  of  the 
Europe  Now  programme,  a  major  fiscal  reform  initiative  introduced  at  the  end  of  2021  to 
support  post-pandemic  recovery.  The  government  expects  to  limit  some  of  the  negative 
impacts  from  the  war  on  Ukraine  on  the  local  economy  by  reducing  taxes  on  basic 
consumption goods and fuels, providing support for agriculture production, and focussing on 
alternative tourist markets to compensate for the loss of Russian and Ukrainian visitors. The 
new minority government formed in April 2022, endorsed the conclusions  of the Economic 
and  Financial  Dialogue  between  the  EU  and  the  Western  Balkans  and  Türkiye  on  24  May 
2022,  agreeing  to  implement  macro-fiscal  and  structural  policies  and  reforms  to  foster  a 
strong  recovery  outlined  in  the  previous  government’s  Economic  and  Reform  Programme 
(ERP).  The  policy  guidance  set  out  in  the  conclusions  of  the  Economic  and  Financial 
Dialogue of 12 July 2021 were partially implemented. 

Macroeconomic stability 

in 

since 

2017, 

average 

A strong rebound of the economy in 2021 
was largely driven by a revival of tourism. 
After recording annual growth of some 4.6% 
on 
2020 
Montenegro’s economy registered one of the 
deepest contractions in  Europe (-15.3%) due 
to the COVID-19 crisis and the large role of 
the  economy.  GDP  growth 
tourism 
in  2021, 
rebounded  strongly  by  12.4% 
following  the  reopening  of  borders  and  the 
ensuing  robust  revival  of  tourism.  The  recovery  of  tourism  had  positive  spillover  effects 
across  the  economy,  including  on  net  exports  and,  to  a  lesser  extent,  private  consumption. 
Government consumption increased only moderately, as COVID-19-related support measures 
started to expire. Investment activity remained weak, contracting by 10% y-o-y in 2021. The 
outbreak of Russia’s war against Ukraine in February 2022 had so far limited direct impact 

in 

63 

 
 
on  Montenegro’s  economy,  as  the  country  is  not  reliant  on  Russian  gas  or  oil.  However, 
Montenegro is exposed to Russia and Ukraine in terms of tourism and investment (the latter 
mostly  in  real  estate).  Further  withdrawal  of  COVID-19  containment  measures  and  strong 
growth in tourism activity boosted annual GDP growth in the first quarter of 2022 too, rising 
by  7.2%  over  the  year.  Domestic  demand  was  fuelled  by  a  two-digit  surge  in  private 
consumption, while government consumption and capital formation grew at a more moderate 
pace.  However,  net  exports  had  a  negative  contribution  to  economic  growth,  as  strong 
demand  and  rising  import  prices  broadened  the  trade  deficit.  Overall,  the  rebound  of  the 
economy  brought  partially  back  Montenegro’s  level  of  per-capita  income  in  purchasing 
power standards to 47% of the EU-27 average in 2021, compared to 45% in 2020, but still 
remains below the 50% level registered in 2019. 

The  strong  recovery  of  tourism  helped 
reduce the external deficit. Montenegro has 
been  recording  very  high  current  account 
deficits  in  the  last  five  years,  averaging 
16.5%  of  GDP  since  2017.  The  current 
account  gap  narrowed  to  9.2%  of  GDP  in 
2021,  compared  to  26.1%  of  GDP  a  year 
improvement  was 
before.  This  sizeable 
mainly  driven  by  a  surging  surplus  in  the 
services  account,  which  reached  19.5%  of 
GDP  in  2021  compared  to  4.2%  in  2020 
thanks  to  recovering  tourism,  and  almost 
equalled  its  pre-pandemic  level.  Moreover,  inflows  from  compensation  of  employees 
working abroad and  from  remittances  also  expanded in  2021.  By contrast, the merchandise 
trade  deficit  widened  to  39.0%  of  GDP  in  2021  due  to  a  fast  growth  in  imports  driven  by 
stronger domestic demand and rising global commodity prices. The rapid increase in exports 
did  not  suffice  to  compensate  for  stronger  import  growth,  as  merchandise  exports  covered 
only 21.5% of total imports. The reopening of the economy resulted in a fast recovery in net 
FDI  too,  which  surged  23.5%  y-o-y  in  nominal  terms  and  totalled  11.2%  of  GDP  in  2021, 
thus surpassing the external deficit. Investment in real estate was almost 2.4 times higher than 
a year earlier. On the other hand, investment into intercompany debt dropped by 24.6% y-o-y, 
as local firms required less support from their foreign parent companies. The recovery in FDI 
inflows continued in the first half of 2022. The current account deficit increased significantly 
in the first half of 2022, by 31% year-on-year, driven by a sharp rise in the value of imports. 
The  stock  of  international  foreign  exchange  reserves  declined  from  the  equivalent  of  6.8 
months  of  imports  of  goods  and  services  at  the  end  of  2021,  to  5.3  months  in  the  second 
quarter of 2022. 

Inflation  has  been  increasing  substantially  but  Montenegro  has  a  very  limited  set  of 
monetary  policy  tools  to  tackle  it.  Inflation  remained  low  in  the  period  2017-2020, 
averaging 1.3%. However, since March 2021, higher food and energy prices kept generating 
inflationary  pressures,  with  the  harmonised  index  of  consumer  prices  rising  on  average  by 
2.5% in 2021 and by 4.5% y-o-y at the end of year, compared to -0.8% average contraction in 
2020.  Russia’s  war  against  Ukraine  exacerbated  price  pressures  and  inflation  has  remained 
elevated  throughout  2022.  In  the  first  seven  months  of  2022,  consumer  prices  increased  in 
Montenegro by an average of 13.7% y-o-y, compared to  (8.9%) in the euro areas. 

64 

 
 
the 

thanks 

Public  finances  recorded  a  significant  improvement  since  2021,  but  both  revenue  and 
expenditure  reforms  are  still  needed  to  support  a  sustainable  consolidation  path.  the 
strong  increase  in  budget  revenue,  together  with  capital  budget  under-execution  and  lower 
spending on goods and services, enabled a significant improvement of the fiscal position in 
2021. The budget deficit came in at 1.9% of GDP, lower than the originally planned 2.8% of 
GDP.  This  was  a  very  sizeable  improvement  compared  to  the  deficit  of  11.1%  of  GDP 
recorded in 2020 or the average deficits of some 5.2% of GDP registered since 2017. Apart 
from  the  economic  rebound,  budget  revenue  was  supported  by  the  introduction  of  higher 
excise  rates,  the  electronic  fiscalisation  of 
businesses’  cash  registers, 
tax 
increased 
discipline  and 
transfer  of  public 
companies’  profits  to  the  central  budget.  In 
2021,  public  expenditure  declined  by  2%  y-
o-y, 
to  finance 
COVID-19  support  measures  and  social 
transfers,  and  delays  in  public  investment. 
The  2022  budget,  which  was  adopted  in 
December  2021,  introduced  a  progressive 
taxation  system  and  abolished 
income 
mandatory health insurance, thereby significantly reducing labour costs, but also entailing a 
permanent  reduction in  revenue. At the same time, some of the  planned  revenue-increasing 
measures were rejected by the parliament while  new social initiatives were adopted without 
accompanying financing measures, putting at risk the targeted budget balance once these are 
implemented in  the second half of the  year. With budget  revenue boosted by the economic 
recovery  and  high  inflation,  the  central  government  deficit  amounted  to  only  0.6%  of  the 
projected GDP in the first half of 2022, compared to a deficit target of 5% for the year as a 
whole.  On  25  May,  the  parliament  adopted  a  budget  revision  as  the  new  government 
established in April increased the number of ministries. 

lower  needs 

to 

A  high  level  of  public  debt  continues  to  be  a  key  vulnerability,  even  though  the  debt 
ratio recorded a strong decline. The public debt stock reached a record high level of 105% 
of  GDP  at  the  end  of  2020.  In  2021,  the  government  made  use  of  its  reserves  to  pay  back 
maturing debt,  which, combined with  the strong economic  rebound and  the  budget  primary 
surplus, resulted in a reduction of the debt ratio to 83.3% of GDP. In the first quarter of 2022, 
the  public  debt  decreased  further,  to  76.6%  of  GDP.  However,  with  global  financing 
conditions worsening, debt-related vulnerabilities remain high. 

Montenegro  macroeconomic  policy  mix  is  constrained  by  the  lack  of  an  autonomous 
monetary policy and a complicated political situation compromising the efficiency of the 
fiscal  policy.  The  unilateral  use  of  the  euro  means  that  the  Central  Bank  of  Montenegro 
cannot  influence  interest  rates  and  money  supply,  and  therefore  the  country  would  need  to 
tighten  fiscal  policy  to  constrain  price  growth.  In  spite  of  the  complex  situation,  the 
authorities’  policy  response  managed  to  reduce  significantly  the  budget  deficit  and  public 
debt, orderly unwinding the COVID-19 support measures in 2021, and providing households 
with  a  significant  increase  in  real  disposable  income  since  beginning  of  2022.  Overall, 
despite two changes of government (in December 2020 and April 2022) economic and fiscal 
policies remained broadly sound, notwithstanding some hasty social spending measures and 
overambitious public investments plans. 

Functioning of product markets 

Business environment 

65 

 
 
The  recovery  of  economic  activity  has  been  reflected  in  the  growing  number  of 
registered  businesses.  So  far,  electronic  registration  remains  only  available  for  single-
member limited liability companies. This does not seem to represent a major obstacle given 
the increasing number of newly registered businesses. The reduction of a significant number 
of local taxes and fees, and the availability of some 40 support programmes in addition to the 
pandemic support measures helped to promote entrepreneurship. Thus, at the end of 2021, the 
number of business increased by 8.7% to 65,621; this compares to 60,361 in 2019 before the 
COVID-19  crisis.  Also  in  December  2021,  the  government  adopted  a  program  to  attract 
digital nomads, offering tax reliefs on personal income to foreign companies’ teleworkers.  

The out of court’s bailiff system remains the key pillar for enforcement of debt claims, 
but needs to be reinforced. In 2021, the number of debt claim cases increased by 15.6% y-
o-y. However, almost two thirds of cases received during 2021 are still pending, stressing the 
need to reinforce the debt collection system. The Commercial Court presents a higher rate of 
successful  case  handling,  receiving  1,065  cases  in  2021  and  solving  95.4%  the  same  year, 
with an average time for resolution of bankruptcy proceedings of 221 days compared to 234 
days a year before. Overall, Montenegro’s bankruptcy system is relatively well functioning, 
but some extreme cases are negatively affecting the average proceeding time. 

Government  efforts  to  reduce  informality  need  to  continue  and  require  more  focus  in 
the  coming  years.  The  abolition  of  health  contributions  in  2022  reduced  some  of  the 
disincentives for employers to formalise employment. However, the government still needs to 
adopt a comprehensive action plan (pending the completion of a survey on informality among 
enterprises and households) for fighting the informal economy, including the strengthening of 
enforcement capacities, and in particular, tax and labour inspections. 

State influence on product markets 

State influence on the economy remains limited, despite some recent measures aimed to 
contain price increases. The ministry of economic development proposed in December 2021 
the free formation of prices of white bread as of January 2022. As a result, bread price surged 
by 30% as of 10 January 2022.  In an effort to contain the increase in the cost of living, the 
Parliament approved on 11 May 2022 a special law allowing the government to set temporary 
price  caps  on  key  essential  products.  Following  this,  the  government  reduced  in  June  2022 
the amount of excise duty for the sale of unleaded fuel and gas -oils by 50% and limited the 
price margins of flour, sugar, table salt and cooking oil by up to 5% on the wholesale price of 
the products and by 7% the retail price. The government has also approved additional EUR 1 
million  to  be  used,  amongst  others,  for  market  interventions  to  ensure  price  stability  of 
agricultural  commodities.  Overall,  the  allocated  amount  for  subsidies  in  the  general 
government budget has remained limited, averaging 0.8% of GDP annually since 2017. The 
Agency for Protection of Competition (APC) increased the number of competition and state 
aid investigations and established a general register of state aid to ensure better transparency 
and  monitoring  of  public  aid.  Thus  far,  the  major  beneficiary  of  state  aid  has  been 
Montenegro Airlines.  The company has  been under bankruptcy procedures  since mid-2021. 
In  December  2021,  the  parliament  adopted  a  law  annulling  the  decision  from  2019  that 
granted  Montenegro  Airlines  EUR  155  million  over  a  6-year  period.  However,  a  plan  to 
recover the funds already disbursed still needs to be adopted. 

Privatisation and restructuring 

The  privatisation  process  is  quite  advanced  considering  the  limited  number  of  state-
owned  enterprises  (SOEs);  however,  important  challenges  remain  in  terms  of  their 
governance and profitability. In July 2022, the government decided to liquidate the public 

66 

 
 
company  ‘Montenegro  Works’  established  less  than  one  year  earlier  by  the  previous 
administration. The goal of this company was to relaunch the privatisation agenda, define an 
optimal  portfolio  of  state  ownership  after  transforming  SOEs’  management  structures, 
eliminate  political  patronage  and  improve  financial  performance  to  reduce  fiscal  risks  (a 
challenging task considering that financial statements of 53% of SOEs audited are not aligned 
with  international  financial  reporting  standards  and  several  companies  are  running  losses). 
The government intends instead to develop a system to monitor public companies’ business 
operations  and the related fiscal  risks. This  new system would  be supported by a dedicated 
department at the Ministry of Finance as well as the independent analysis of a fiscal council, 
yet to be established. These plans do not seem to address, however, the fundamental issues of 
optimising state ownership portfolio and improving overall SOEs governance and fall short 
on Montenegro’s Economic Reform Programme commitments. 

Meanwhile, the government increased its founding capital as shareholder of the new national 
airline company “To Montenegro”. However, the sustainability of this company is yet to be 
ensured, as debt started soon to accumulate since its first year of operation. The second stage 
of the tender procedure for a 30-year concession of the two international airports (Podgorica 
and Tivat) remains on hold as the new government has not decided yet whether to cancel or 
continue  the  procedure.  After  establishing  a  commission  to  audit  past  sales  contracts,  the 
privatisation council has not held any sessions since July 2021. 

Functioning of the financial market 

Financial stability 

The  banking sector proved to be resilient and the financial sector stability has overall 
been  maintained.    The  banking  sector  further  consolidated  after  recording  two  mergers  in 
2021, reducing the total number of banks in Montenegro from 13 to 11. Yet, the ownership 
structure of the banks' capital did not change significantly. At the end of 2021, bank's capital 
was predominately foreign with an 85% share, originating mainly from large banking groups 
from the EU in control of 79.9% of the banking market, while the share of domestic capital 
totalled  15%.  The  Central  Bank  of  Montenegro  (CBCG)  concluded  in  September  2021  an 
asset  quality  review  (AQR)  for  all  domestic  banks  according  to  the  ECB  methodology. 
Results confirmed the stability and strong position of the domestic banking system at the start 
of the COVID-19 crisis. During the pandemic, the CBCG adopted ten packages of temporary 
measures aimed at preserving the liquidity and solvency of domestic banks. As a result, the 
balance sheets of domestic banks recorded significant growth, and the capital adequacy ratio 
totalled 18.5% at the end of 2021, well above the statutory minimum of 10%. The phasing-
out of fiscal support and targeted loan moratoria did not lead to a significant deterioration in 
the  quality  of  the  loan  portfolio,  but  risks  remain  and  should  be  closely  monitored,  in 
particular in the context of a worsening growth outlook and tightening financing conditions. 
The NPL ratio increased to 6.2% at the end of 2021 up from 5.5% the year before, to peak at 
6.9% in January 2022 and to start declining gradually afterwards, reaching 6.3% in June. 

Access to finance 

Credit  activity  has  been  growing  continuously  since  2019,  supporting  the  corporate 
sector in particular. Total loan growth accelerated from 5.0% y-o-y in 2020, to 6.6% y-o-y 
in  2021 and further 6.8%  y-o-y in  June 2022. The rapid  increase was led by  lending to  the 
corporate sector, while  the increase in  loans to  households remained moderate  and  loans to 
the public sector decreased. The recovery of the economy has been reflected in a fast increase 
in banks’ deposits too, which went from a 2.6% y-o-y contraction in 2020 to a 12.8% y-o-y 
expansion  in  2021,  and  a  surge  by  21.4%  y-o-y  in  June  2022,  again  led  by  the  corporate 

67 

 
 
sector.  Although  trending  down,  lending  interest  rates  are  still  high  presenting  one  of  the 
major  obstacles  to  access  finance,  in  particular  for  small  businesses.  In  March  2022,  the 
government  adopted  a  law  to  establish  a  national  Credit  Guarantee  Fund.  With  the  support 
from the EBRD, work commenced to establish a roadmap and overarching framework for the 
new institution. 

The size of the non-bank financial sector remains marginal. The stock market’s role in the 
local economy is very small in terms of market turnover (0.95% of GDP in 2021), while the 
assets  of  insurers  represent  around  2%  of  GDP.  Microfinance  is  the  most  commonly  used 
source of alternative finance, with assets accounting for some 1.6% of GDP in 2021. 

Functioning of the labour market 

packages, 

employment 

The  labour  market  continues  to  suffer 
from  structural  deficiencies.  The  outbreak 
of the COVID-19 in March 2020 was rapidly 
followed  by  a  sharp  decline  in  employment 
and  a  surge  of  unemployment  due  to  the 
collapse  of  tourism.  Despite  several  state-
support 
kept 
contracting  until  June  2021.  As  a  result, 
employment declined on average by 2.4% y-
o-y  in  2021,  after  recording  a  10.1%  y-o-y 
plunge  a  year  before.  By  contrast,  the 
unemployment rate witnessed some relative improvement in 2021, falling to 16.9% compared 
to 18.4% a year earlier. However, the reason for this decrease in unemployment was a lower 
participation in the labour market, which fell from a peak of 66.2% in 2019 to 59.2% in 2021. 
The employment rate bounced back to 54.4% in  the first quarter of 2022, up from 44.8% a 
year before, practically recovering pre-pandemic levels. The reduction of the unemployment 
rate  was  particularly  pronounced  for  women,  reaching  15.5%  in  2022  Q1  compared  to  a 
much  higher  rate  of  19.7%  a  year  ago,  as  services  –where  a  majority  of  women  work– 
recovers  faster  than  the  industrial  and  construction  sectors,  where  men  are  majority.  As  a 
result, the pace of reduction of men’s unemployment rate was significantly slower, declining 
to  18.3%  in  2022  Q1  compared  to  a  19.5%  rate  a  year  earlier.  Overall,  the  pandemic 
highlighted the structural deficiencies of Montenegro’s labour market. Youth and long-term 
unemployment  remain  high  and  there  are  considerable  regional  disparities  (e.g.  5% 
unemployment  rate  in  the  coast,  compared  to  substantially  higher  levels  in  the  central  and 
northern  areas  of  11.9%  and  36.7%,  respectively).  Overall,  the  provision  of  active  labour 
market  policies  is  not  effective  in  activating  people  on  the  labour  market.  Moreover,  the 
country lacks a continuous monitoring mechanism of active labour market measures, which 
should be carried out by the Employment Agency of Montenegro. However, the reform of the 
currently  ineffective  institutional  setup  of  the  Agency  has  not  been  implemented.  The 
effective  application  of  the  labour  law  has  been  hampered  by  poor  implementation  and 
malpractice.  For  instance,  to  avoid  dismissal  costs  employers  request  new  hires  to  sign 
resignation  letters  upon  recruitment.  Moreover,  there  has  been  no  cases  where  a  foreign 
investor  has  been  successful  in  court  in  relation  to  the  application  of  the  labour  law.  Real 
wage growth was negative between 2017 and 2021, except for a deflationary period in 2020. 
Despite accelerating inflation, the government boosted households’ real disposable income in 
2022, after rising the minimum gross wage by 43% (which translates into an 80% increase in 
net  terms), and reducing significantly the tax wedge on labour. As a result, the net  average 
wage climbed to EUR 707 in April 2022, up from EUR 537 at the end of 2021.  

68 

 
 
2.3.2. The capacity to cope with competitive pressure and market forces within the 
Union 

Montenegro has made some progress and is moderately prepared to cope with competitive 
pressure  and  market  forces  within  the  EU.  The  last  two  governments  worked  to  improve 
innovation  capacities  and  to  set  the  basis  for  a  green  and  digital  transition  in  an  effort  to 
diversify  Montenegro’s  narrow  production  base.  In  particular,  modern  telecommunication 
and  ambitious  green  energy  projects  are  being  deployed.  However,  infrastructure  gaps 
persist,  as  the  country  administrative  and  financial  capacities  to  identify,  prioritise  and  to 
implement major public investments remain limited, hampering the use of EU support. The 
education  system  still  faces  numerous  challenges  with  a  chronic  shortage  of  science, 
technology,  engineering  and  mathematics  (STEM)  graduates.  In  addition,  the  low  value  -
added  of  domestic  products,  the  small  size  of  local  companies  and  their  low  level  of 
participation 
the  productivity  and 
competitiveness of local firms. 

represent  obstacles 

in  exports 

increasing 

for 

As some of the 2021 recommendations have not been fully implemented, in the coming year 
Montenegro should in particular: 

  continue  implementing  digital  services  for  micro,  small  and  medium  enterprises  and 
prioritise the development and implementation of interactive e-government platform for 
transactional electronic services; 

  improve dual VET and tertiary education programmes in close cooperation with business 

associations; 

  Implement  the  public  investment  management  assessment  (PIMA)  recommendations, 

prioritising key public infrastructure works without endangering public finances. 

Education and innovation 

Montenegro’s  education  system  faces  numerous  challenges.  Due  to  the  COVID-19 
pandemic,  little  progress  has  been  made  in  advancing  reforms  to  improve  the  quality  of 
education on the basis of agreed action plans. Recent tests had confirmed that both the quality 
and relevance of the education system, including the lack of practical experience of graduates 
from  vocational  and  higher  education,  remain  key  challenges.  The  occupational  mismatch 
appears particularly high for tertiary education graduates, with a chronic shortage of medical 
and  STEM  graduates,  putting  at  risk  Montenegro’s  smart  specialisation  strategy.  The  high 
transition  rate  from  vocational  education  to  some  higher  education  programmes  without 
occupational  demand  in  Montenegro’s  labour  market  aggravates  youth  unemployment.  The 
recent strategy for digitalization of the education system (2022-2027) aims to make internet 
available in all schools. 

Montenegro  increased  the  budget  allocation  for  research  and  development  but  it  still 
remains modest, totalling 0.15% of GDP in 2022, compared to the EU average of 2.3%. 
In 2021, only 18% of Montenegrin firms introduced a new product or service compared to a 
37% average in the Western Balkans. Moreover, 80% of local firms declare that that they do 
not  invest  in  R&D.  To  improve  this  situation,  the  government  established  the  Innovation 
Fund in September 2021 as a state-owned limited liability company. The main activity of the 
Fund is to provide financial resources for the development of innovative entrepreneurship and 
to  encourage  cooperation  between  the  scientific  and  economic  sectors.  In  April  2022,  the 
Fund  launched  its  first  two  calls  for  support  schemes  for  entrepreneurs.  After  some  initial 
delays, the construction of a large Science and Technology Park in Podgorica is in progress. 
Works also continues on the development of an information and communication technology 

69 

 
 
cluster  to  support  the  implementation  of  the  smart  specialisation  strategy.  The  local  IT 
industry is  relatively small but  it has been developing fast  in  the last three  years.  In March 
2022, the Ministry of Economic Development and the University of Montenegro  decided to 
establish a National Technology Transfer Office within the Science and Technology Park in 
Podgorica. 

Physical capital and quality of infrastructure 

Efforts are ongoing to support the digital and green transition but infrastructure gaps 
remain.  In  December  2021,  the  Government  adopted  the  Strategy  for  the  Digital 
Transformation  of  Montenegro  (2022-2026),  which  takes  a  comprehensive,  horizontal 
approach  and  contains  objectives  related  to  the  development  of  digital  infrastructure  and 
connectivity.  The  telecommunications  sector  keeps  developing  fast.  In  December  2021,  the 
first three 5G frequency licences were granted and one operator already launched commercial 
5G  mobile  network  services.  Access  to  green  finance  has  been  strengthened  with  the 
establishment  of  the  Eco  Fund  (2020),  providing  financial  support  for  the  development  of 
projects  in  the  fields  of  preservation,  sustainable  use,  protection  and  improvement  of  the 
environment, energy efficiency, and use of renewable sources. Reconstruction of the Pljevlja 
thermal power plant to reduce its environmental impact was launched in April 2022. In order 
to  advance  gradually  with  the  transition  away  from  coal,  Montenegro’s  national  utility 
company is preparing a study for the construction of gas-fired power plants. The government 
withdrew  concessions  for  several  smaller  hydropower  plants,  but  continues  with  plans  for 
larger ones, while the private sector advances with plans for constructing new wind and solar 
capacities. The first  section of the Bar-Boljare highway was  opened to  traffic in  July 2022, 
with  a  three-year  delay.  The  EU-financed  feasibility  study  and  cost-benefit  analysis  for  the 
entire Bar-Boljare highway, including on recommended construction standards and means of 
financing  for  the  remaining  sections,  is  underway  and  it  should  be  completed  in  2022. 
Meanwhile, works on the Adriatic-Ionian expressway could not start yet as preparation of the 
Budva bypass section preliminary design work was not mature enough. The upgrade of the 
railway network continued but with delays in some sections. 

Sectoral and enterprise structure 

The  structure  of  the  economy  has  remained  broadly  unchanged,  but  adjustments  are 
taking  place  within  sectors.  Overall,  small  and  medium  size  companies  remain  the 
backbone  of  Montenegro’s  economy,  accounting  for  some  94%  of  total  firms.  The 
distribution of employment remained stable, with the services sector absorbing roughly three 
quarters  of  total  employment  in  2021,  while  industry  and  construction  (16.9%)  as  well  as 
agriculture  (6.4%)  accounted  for  a  much  lower  shares.  Within  services,  tourism  is 
predominant, contributing a quarter of Montenegro’s GDP. The sector was severely hit by the 
COVID-19 crisis but recovered better than expected in 2021 and 2022. Visitors from Russia 
and  Ukraine  used  to  make  up  a  significant  share  of  foreign  tourists.  In  order  to  limit  the 
negative impact of the war against Ukraine, the sector has shifted its focus to other markets. 
The  metallurgical  sector  recorded  a  major  adjustment  following  the  surge  in  energy  prices 
resulting in the stoppage of the aluminium smelter as well as of the Niksic’s ironworks due to 
unsustainable  production  costs.  The  halt  in  production  of  the  metal  producers  provided  a 
major  opportunity  for  the  energy  sector,  which  exported  at  substantially  higher  prices9  the 
electricity surplus not consumed by the industry. The energy sector is currently engaged into 
its green transition, developing a number of renewable generation plants. 

9 Large industrial consumers enjoyed significant rebates in energy prices. 

70 

 
 
                                                           
Economic integration with the EU and price competitiveness 

The  economic  recovery  boosted  external  trade  and  brought  the  trade  openness  ratio 
back  to  its  pre-pandemic  level.  During  2021,  Montenegro’s  foreign  trade  expanded  by 
19.1% y-o-y, while bilateral trade with the EU followed the same trend, growing 12% over 
the year. Overall, the total exchange of goods and services recovered to pre-pandemic levels, 
totalling 105.8% of GPD in 2021, after having plunged to 86.3% in 2020 as a consequence of 
the recession induced by the COVID-19 crisis. The EU remains Montenegro’s main foreign 
partner, accounting for 31.1% of total exports and 45.7% of total imports of goods. CEFTA 
countries  also  remain  an  important  market,  accounting  for  43.2%  of  Montenegro’s  total 
exports and 28.5% of total imports of goods.  The EU also  remains the main source of FDI 
inflows for Montenegro, registering 36.4% of total FDI inflows in 2021, compared to 27.0% 
a year before. The low processing level of domestic products and the very small size of local 
businesses represent two key challenges for boosting Montenegro’s export performance. To 
remedy  this,  the  government’s  micro-  and  small-sized  enterprises  strategy  supports 
establishment of vertical clusters, especially in agriculture and tourism. 

2.4. PUBLIC PROCUREMENT, STATISTICS, FINANCIAL CONTROL  

Chapter 5: Public procurement  

EU rules ensure that public sector procurement of goods, services and works in any Member 
State  is  transparent  and  open  to  all  EU  companies  on  the  basis  of  non-discrimination  and 
equal  treatment.  EU  rules  ensure  that  public  sector  procurement  of  goods,  services  and 
works in any Member State is transparent and open to all EU companies on the basis of non-
discrimination and equal treatment.  

Montenegro  is  moderately  prepared/has  a  good  level  of  preparation  on  public 
procurement.  Good  progress  was  achieved  in  2021,  with  full  implementation  of  the 
electronic procurement system and further improvement in the functioning of the remedy 
system. Last year’s recommendation on e-procurement was met. 

In the coming year, Montenegro should: 

  further  improve  the  functionality  of  the  e-procurement  system  and  its  interoperability 

with state administration registers;  

  fully  respect  the  EU  public  procurement  rules  in  all  relevant  cases,  such  as  when 

awarding the concession to operate Airports of Montenegro. 

Institutional set-up and legal alignment 

The  legal  framework  on  public  procurement  is  well  aligned  with  the  EU  acquis.  The 
government adopted a new 2021-2025 strategy for improving public procurement and public-

71 

 
 
 
private  partnership  policies  in  October  2021.  An  accompanying  action  plan  for  2022  was 
adopted at the same time. 

The electronic public procurement system became fully operational in 2021. By June 2022, 
all 662 contracting authorities and 3 687 economic operators were registered in the system. 
The  implementation  of  e-procurement  has  the  potential  to  significantly  reduce  the  risks  of 
corruption  and  breaches  of  competition  rules,  limiting  the  number  of  appeals.  Further 
functionalities  of  the  e-procurement  system  should  be  implemented  in  the  course  of  2022, 
including connections to  the electronic registers  of the Ministry of Justice and the Revenue 
and Customs Administration. These improvements will be instrumental for eligibility checks 
on the economic entities that participate in public procurement procedures and should further 
increase the transparency and fairness of the procurement system in Montenegro. 

The tender for the concession to operate Airports of Montenegro, suspended in 2020, has 
not been reactived yet. Full compliance of this and any other relevant procedure with the EU 
rules  and  standards  of  fair  and  transparent  public  procurement,  providing  value  for  money, 
competition and strong safeguards against corruption, would be essential for Montenegro in 
line with the requirements of this negotiating chapter. 

Implementation and enforcement capacity  

Montenegro’s public procurement market corresponded to 4.47% of GDP in 2021 and the 
value  of  all  public  procurement  procedures  amounted  to  some  EUR  220  million.  This  was 
much below the values achieved in 2020 and caused by the very late adoption of 2021 state 
budget, major organisational changes in the public administration and COVID-19 crisis.  

On  the  monitoring  of  contract  award  and  implementation,  the  Public  Procurement 
Inspectorate executed 297 controls,  the number increasing by 18 % in  comparison  to  2020. 
Most controls related to contract conclusion and execution phases. 

A regulatory and institutional framework is in place on integrity and conflict of interest in 
public procurement. 

The  capacity  to  manage  public  procurement  processes  continued  to  improve,  to  a  large 
degree  thanks  to  the  introduction  of  e-procurement.  Nonetheless,  the  high  number  of 
contracting  authorities  remains  an  obstacle  to  the  overall  efficiency  of  the  procurement 
system.  The  capacity  of  smaller  municipalities  to  conduct  larger  and  more  complex  public 
procurement  procedures,  including  under  EU-financed  projects,  remains  very  limited.  The 
Directorate for Public Procurement Policy in the Ministry of Finance systematically organises 
trainings on the legal framework in public procurement and examinations for candidates for 
procurement officer positions. It also prepares and publishes technical instructions and expert 
guidance on the procurement rules. 

Efficient remedy system 

The  legislation  on  the  right  to  appeal  is  broadly  in  line  with  the  EU  acquis.  Cases  are 
handled by the Commission for Protection of Rights in Public Procurement Procedures.  

The  Commission  received  162  complaints  in  the  period  15  June  2021-15  June  2022,  a 
decrease  of  33%  in  comparison  to  the  previous  period.  The  Commission  also  acted  on 
20 judgements received from the Administrative Court of Montenegro, which represent cases 
returned for reconsideration. There were no significant delays in the treatment and resolution 
of the complaints. 

72 

 
 
The  Supreme  Court  of  Montenegro  conducted  five  extraordinary  reviews  of  the  decisions 
taken  by  the  Administrative  Court  on  procurement  procedures  and  in  one  case  upheld  a 
request for the review of the decision. 

Chapter 18: Statistics 

EU rules require that Member States are able to produce good quality statistics in line with 
the  principles  of  the  European  statistics  Code  of  Practice  and  based  on  professional 
independence, impartiality, reliability, transparency, and confidentiality. Common rules are 
provided for the methodology, production and dissemination of statistical information. 

last  year’s  recommendations.  Work  continued  on  harmonising 

Montenegro is moderately prepared in the area of statistics. Limited progress was made 
the  statistical 
on 
methodology with EU standards and increasing transmission of data to Eurostat. However, 
pending  issues  remain  with  regard  to  insufficient  financial  and  human  resources  of  the 
Statistical  office  of  Montenegro  (Monstat)  and  its  lack  of  expertise  in  some  areas; 
systematic  cooperation  and  coordination  of  tasks  between  the  Ministry  of  Finance,  the 
Central Bank of Montenegro and Monstat; transmission of some fundamental datasets such 
as  government  finance  statistics,  as  well  as  financial  accounts  and  excessive  deficit 
procedure tables to Eurostat. Thus, the 2021 report recommendations remain valid.  

In the coming year, Montenegro should in particular: 

  considerably  strengthen  the  human  and  financial  resources  of  Monstat,  so  that  it  can 

fully fulfil its responsibilities and retain expert staff;  

  make  significant  progress  in  aligning  with  the  European  System  of  Accounts  (ESA) 
2010,  including  providing  government  finance  statistical  data  and  all  available 
excessive deficit procedure data; 

  carry out the national population and housing census in line with EU requirements and 

recommendations and allocate sufficient resources for the exercise. 

The  legal  framework  for  statistical  infrastructure  is  broadly  in  line  with  the  European 
Statistics Code of Practice. Monstat is the main producer and overall coordinator of statistics. 
The current number of employees in Monstat remains slightly above 50% of the number of 
posts foreseen in the organisation chart. While a new Director was appointed in March 2022, 
the new building for the Statistical  office has still  not  been provided. The Statistical  Office 
accomplished  the  automation  of  three  statistical  releases  (consumer  price  index,  arrivals, 
overnight  stays  of  tourists  in  collective  accommodation  and  average  wages)  with  monthly 
data collection and its publication (in Montenegrin and English).  

During 2021, the Statistical Office worked on improving statistical products and processes 
by introducing a self-assessment system of the statistical  production process,  increasing the 
number of quality reports for users on the official website of Monstat. In May 2022, Monstat 
launched a User Satisfaction Survey, the previous one dating back to 2017.  

On classifications and registers, there is high compliance in terms of implementation of the 
current versions of the  NACE (Nomenclature of Economic  Activities),  CPA (Classification 
of  products  by  activity),  ISCO  (International  standard  classification  of  occupations)  and 
ISCED  (International  standard  classification  of  education)  classifications.    Montenegro  is 
medium  compliant  on  business  registers,  and  it  needs  to  improve  the  quality,  especially 
regarding completeness of mandatory variables. 

In  the  area  of  macroeconomic  statistics,  and  specifically  national  accounts  statistics, 
Monstat published a number of data sets related to the gross national income (GNI) and the 

73 

 
 
gross domestic product (GDP) in accordance with ESA 2010. In order to improve Consumer 
Price  Index  /  Harmonised  Index  of  Consumer  Prices,  a  new  software  application  for 
calculation was created, which automatised the data processing and resolved inconsistencies 
in the index aggregation. The required sets of monthly international trade in goods data are 
regularly  submitted  to  Eurostat  according  to  the  new  data  structure.  In  the  field  of  trade  in 
services,  steps  were  taken  in  estimating  the  Financial  Intermediation  Services  Indirectly 
Measured  (FISIM)  statistics:  the  data  was  published  and  transmitted  to  Eurostat.  Monstat 
makes  efforts  to  comply with  ESA 2010 methodology filling out  more variables within the 
tables for time series 2006-2020, but further efforts are needed in that regard (e.g. calculation 
of GDP by income approach, and introducing non-financial sector accounts).  

Government  finance  statistics  are  not  sent  to  Eurostat.  As  regards  excessive  deficit 
procedure data, tables are still sent mostly empty. The methodological background, legal and 
institutional  framework  and  adequate  human  resources  are  needed.  In  the  area  of  monetary 
and financial statistics, the Central Bank of Montenegro (CBM) continued to report regularly 
to  Eurostat  and  transmitted  quarterly  balance  of  payments  (BoP)  data  for  2021,  as  well  as 
preliminary  annual  data  for  2020  and  revised  data  for  2019  in  the  field  of  foreign  direct 
investment.  Montenegro is encouraged to start sending monthly BoP data to Eurostat and to 
further  improve  the  geographical  breakdown  of  BoP  and  IIP  (international  investment 
position) data. 

In  the  area  of  business  statistics,  the  harmonisation  of  short-term  indicators  with 
international  standards  of  all  domain  statistics  (industry,  construction,  retail  trade  and 
services) continued. This data is calendar and seasonally adjusted and forwarded to Eurostat 
in the required format.  

In  the  area  of  social  statistics,  the  Law  on  the  census  of  population,  households  and 
dwellings still needs to be adopted by the Parliament. The timeline of the census is still to be 
specified.  By  December  2021,  the  data  collection  fieldwork  for  a  survey  on  gender-based 
violence was completed, and data for a survey on income and living conditions for 2020 was 
sent  to  Eurostat.  The  2021  survey  was  conducted  via  a  new  method  of  Computer  Assisted 
Personal  Interviewing  (CAPI)  in  April-May  2022.  Monstat  started  conducting  a  regular 
survey on Innovative activities of companies for the period 2018-2020 (data collected in the 
second half of 2021). 

In  the  area  of  agriculture  statistics,  the  preparation  of  the  draft  Law  on  the  agricultural 
census is ongoing. Meanwhile, the implementation of the CAPI method for annual surveys in 
crop  and  livestock  production  was  expanded  to  eleven  municipalities.  Preliminary  data  on 
pesticide  sale  and  organic  production  for  2020  was  submitted  to  Eurostat  in  June  and 
December 2021, respectively.  

In  the  area  of  environmental  statistics,  while  Montenegro  is  overall  highly  compliant  in 
waste statistics, some actions are needed to provide final and not provisional data to Eurostat 
and  to  capture  information  on  secondary  waste.    Environmental  accounts  are  still  not  in 
compliance with the EU requirements. 

Annual  energy  statistics  are  produced  and  fully  harmonised  with  European  legislation 
although  they  are  delivered  one  month  after  the  deadline.  SHARES  statistics  (renewable 
energy  sources)  for  Montenegro  are  available  on  the  basis  of  energy  balance  data  that  are 
regularly transmitted to Eurostat. Energy price statistics are fully compliant with the relevant 
EU acquis. However, monthly reporting, as well as data concerning final energy consumption 
of households were not delivered. Montenegro is medium compliant in energy statistics.  

Chapter 32: Financial control 

74 

 
 
The  EU  promotes  the  reform  of  national  governance  systems  to  enhance  managerial 
accountability, sound financial management of income and expenditure and external audit of 
public funds. The financial control rules further protect the EU’s financial interests against 
fraud in the management of EU funds and the euro against counterfeiting. 

Montenegro is moderately prepared on financial control. Overall, limited progress was 
made on the implementation of last  year’s recommendations, in  particular on completing 
the  strategic  framework  for  public  internal  financial  control  and  the  application  of 
managerial accountability in public administration. The new public administration strategy 
includes actions to improve good governance and control systems. Quality assurance and 
risk management have improved, thanks to continuous training. The State Audit Institution 
is improving its capacities to follow up audit recommendations and continues to work for a 
more open and transparent communication with the Parliament. On the other hand, efforts 
are needed to  further strengthen the internal  control and internal  audit practices in  public 
bodies and in state-owned companies, focusing on performance rather than on compliance. 

Last year’s recommendations remain valid: 

  operationalise the centralised budget inspection function in the Ministry of Finance; 

  steer  and  strengthen 

the  application  of  managerial  accountability 

in  public 

administration; 

  further  align  with  the  EU  acquis  on  the  fight  against  fraud  to  the  Union's  financial 
interests  and  further  strengthen  the  coordination  capacity  of  the  National  Anti-fraud 
Coordination Service.   

Public internal financial control (PIFC) 

Montenegro’s  strategic  framework  for  PIFC  is  now  partly  in  place.  The  new  2022-2026 
public  administration  reform  (PAR)  strategy,  adopted  in  December  2021,  sets  the 
improvement of managerial accountability as a key objective. However, the adoption of the 
new  public  finance  management  (PFM)  reform  programme  is  required  to  complete  the 
strategic  framework.    The  government  adopts  annual  reports  on  the  implementation  of  the 
PAR and PFM strategies, as well as annual consolidated reports on governance and internal 
control in the public sector (last adopted in July 2022).  

The  legislative  and  operational  framework  for  internal  control  and  internal  audit  is  in 
place,  covering  also  local  government  entities  and  state-owned  enterprises.  Additionally,  in 
August 2021, the government adopted the Decree on the establishment of internal audit in the 
public  sector,  with  the  aim  to  harmonise  the  internal  audit  system  with  the  Decree  on  the 
organisation  and  manner  of  work  of  the  state  administration.  Despite  the  fact  that  the  legal 
framework allows delegation of authority in  the  field  of financial management and internal 
control in the public sector, this is not broadly applied in practice.  

The legal and operational framework for financial management is largely in place and is in 
line  with  international  standards.  Further  efforts  are  necessary  to  align  programme-based 
budgeting  and  performance  reporting  with  managerial  accountability,  as  well  as  to  upgrade 
risk management from operational to strategic level. A centralised budget inspection function 
in the Ministry of Finance still needs to be made operational.  

Internal  audit  rules,  standards  and  practices  are  in  line  with  international  standards.  Full 
budget  coverage  is  ensured,  and  the  internal  unit  function  is  organised  on  a  decentralised 
basis. 24 budget users at central government level have established a separate internal audit 
unit,  with  59  internal  auditors  appointed.  All  15 municipalities  obliged  to  establish  internal 

75 

 
 
audit units have done so, with 35 auditors appointed. Adequate staffing of the internal audit 
units at  both  central  and local  level  needs to  be  addressed. So far, 79 of  total  90 appointed 
auditors were certified internal  auditors, while others are in  the process  to  be certified. The 
existing  internal  audit  training  and  certification  system  ensures  a  long-term  professional 
development programme for certified internal auditors, recently focused on risk management 
and  quality  assurance.  However,  follow-up  of  the  recommendations  requires  further 
strengthening.   

The  Central  Harmonisation  Unit  (CHU)  is  responsible  for  developing  and  disseminating 
methodological guidance on PIFC, as well as for monitoring and reporting on implementation 
of  internal  financial  control.  Moreover,  the  CHU  ensures  quality  review  of  financial 
management,  internal  control  and  internal  audit  activities.  Its  annual  reports  contain 
recommendations on how to improve the effectiveness of the internal control systems in the 
public sector. 

External audit 

The  Constitution  of  Montenegro  and  the  existing  legal  framework  ensure  the  functional, 
operational and financial independence of the State Audit Institution (SAI), in line with the 
standards  of  the  International  Organisation  of  Supreme  Audit  Institutions  (INTOSAI).  SAI 
has further improved its institutional capacity in terms of auditing staff. Most of its auditors 
are  certified  and  have  access  to  internal  and  international  training,  including  on  quality 
control, ethics and integrity, gender equality and gender budgeting. One of the five positions 
as  member  of  its  Senate  (the  five  people  in  the  highest  position  who  decide  by  majority), 
however, remains vacant, blocking all decisions as a consequence.  

On  quality  of  audit  work,  SAI  adopts  and  implements  its  annual  audit  plan  based  on  risk 
assessment and on clearly defined criteria. Since June 2021, it carried out 35 audits. 

In  December  2021,  SAI,  as  a  member  of  the  European  Organisation  of  Supreme  Audit 
Institutions  (EUROSAI),  became  a  member  of  the  EUROSAI  working  group  for 
environmental audit.  In  March 2022, SAI  also  became a member of the INTOSAI working 
group for information system audit. 

As  for  the  impact  of  its  audit  work,  SAI  improved  its  capacities  to  follow  up  audit 
recommendations, in line with the updated guidelines for developing, monitoring and control 
of audit recommendations. SAI submits annually a report on performed audits and activities 
to  the  Parliament,  which  includes  an  audit  report  on  the  government’s  final  statement  of 
accounts  and the  excerpts of individual audit reports. The  government  is  obliged to  respect 
and  implement  all  SAI  recommendations  related  to  the  final  statement  of  accounts  and 
individual audits and report to the Parliament on a quarterly basis. However, the Parliament 
still  does  not  ensure  a  structured  follow-up  of  SAI  recommendations.  All  SAI  reports  are 
publicly accessible. 

With regard to  the  Audit Authority, the institution increased its oversight  capacity both  in 
terms of human resources and number of performed audits (25 according to the latest report), 
with improvements on management, accountability and transparency in the use of EU funds. 
The  head  position,  however,  remains  vacant,  which  has  an  impact  on  the  operational 
capacities of this institution. 

Protection of the EU’s financial interests 

With regard to EU acquis alignment, amendments to the Criminal Code of Montenegro are 
under preparation, with the aim to further align the national legislation with the EU Directive 
on  the  fight  against  fraud  to  the  Union's  financial  interests  by  means  of  criminal  law.  The 

76 

 
 
national  Anti-Fraud  Coordination  Service  (AFCOS)  is  improving  its  capacities  to  fight 
irregularities  and fraud  and to  coordinate the AFCOS  network for the protection of the EU 
financial interests. A new national anti-fraud strategy 2022-2025 is under preparation.    

Cooperation  and  exchange  of  information  with  the  European  Commission  (OLAF) 
during investigations continued. Six cases of irregularities were reported in 2021 and five in 
2022.  In  May  2022,  AFCOS  supported  OLAF  during  an  on-the-spot  control.    However, 
Montenegro should increase its efforts in further developing a track record on cooperation in 
investigations and reporting of irregularities.  

Protection of the Euro against counterfeiting 

Montenegro’s  legislation  on  protection  of  Euro  against  counterfeiting  is  partially  in  place. 
The  country  has  the  necessary  structures  for  technical  analysis  and  classification  of 
counterfeit money, including euro banknotes and coins.  

As of November 2021, the Council of the Central Bank of Montenegro (CBCG) amended 
the  Decision  on  authenticity  and  fitness  checking  and  recirculation  of  euro  banknotes  and 
coins. The amended decision is fully harmonised with the relevant decision of the European 
Central Bank (ECB).  

Activities  to  protect  the  euro  against  counterfeiting  in  line  with  harmonised  EU  and  ECB 
regulations and standards continued. The CBCG monitored the cash handlers' work standards 
and tested cash handling devices. It also continued cooperation and exchange of information 
with the Police Directorate and the Higher Prosecutor's Office. Under the signed agreements, 
CBCG  continued  cooperating  and  exchanging  information  with  the  ECB,  the  European 
Commission and other international institutions on protecting the euro against counterfeiting. 

3. GOOD NEIGHBOURLY RELATIONS AND REGIONAL COOPERATION 

Good neighbourly relations and regional cooperation form an essential part of Montenegro’s 
European  integration  process  and  contribute  to  stability,  reconciliation  and  a  climate 
conducive to addressing open bilateral issues and the legacies of the past.  

Montenegro  maintained  its  engagement  in  a  number  of  regional  initiatives,  such  as  the 
Central  European  Free  Trade  Agreement  (CEFTA),  Energy  Community,  Transport 
Community,  the  South-East  European  Cooperation  Process  (SEECP)  and  the  Regional 
Cooperation Council. Montenegro also actively participates in initiatives such as the Central 
European Initiative (CEI) and the Centre for Security Cooperation (RACVIAC).  

Following  the  May  2022  Foreign  Affairs  Council,  EU  foreign  ministers  held,  for  the  first 
time,  an  informal  exchange  of  views  with  Western  Balkans  counterparts.  The  EU  and 
Western Balkans Leaders Meeting on 23 June 2022 reaffirmed the EU perspective of the 
partners in the region and gave impulse to intensify the cooperation and integration agenda. 
Particular focus was placed on the integration of the Western Balkans into EU measures to 
reduce the negative impact of the Russian aggression on Ukraine in terms of food and energy 
supplies and independence, as well as to support capacity building for cyber security and the 
social agenda, notably involving youth in the economy. The meeting was also an opportunity 
to  discuss  closer  political  cooperation,  including  foreign  policy  alignment  of  the  Western 
Balkans with EU positions and restrictive measures. 

At the EU-Western Balkans summit in Brdo pri Kranju in October 2021, the six Western 
Balkans leaders reaffirmed their commitment to inclusive regional cooperation, strengthening 
good neighbourly relations and investing more decisive efforts in establishing the Common 
Regional  Market.  The  summit  announced  a  range  of  concrete  deliverables  benefiting  the 
Western Balkans, including the first set of actions under the Economic and Investment Plan; 

77 

 
 
the pledge to  boost COVID-19 vaccination rates;  the path  towards lower roaming costs;  an 
innovation agenda for the Western Balkans; green lanes to reduce border waiting times and 
Transport Community action plans for smart transport and sustainable connectivity. 

The    Common  Regional  Market,  as  agreed  by  the  leaders  of  the  Western  Balkans  at  the 
2020  Berlin  process  summit  in  Sofia,  is  critical  in  increasing  the  attractiveness  and 
competitiveness  of  the  region.  It  will  help  Montenegro  to  speed  up  the  recovery    from  the 
aftermath  of the pandemic, notably to  attract  investors looking  for diversification of supply 
and shorter value chains and to maximise the benefits of the infrastructure investments under 
the  Economic  and  Investment  Plan.  A  number  of  important  decisions  to  facilitate  the 
movement of workers remain blocked. It is important that all parties play a constructive role 
in building the Common Regional Market and deliver on their joint commitments set out in 
the Common Regional Market’s  action plan. 

In October 2021, Montenegro along with other Western Balkan partners endorsed the action 
plan  for  the  Green  Agenda  for  the  Western  Balkans,  which  mirrors  the  European  Green 
Deal10  in  a  proportionate  and  adapted  manner  in  the  Western  Balkans.  It  provides  for  joint 
actions, which will contribute to the sustainable socio-economic development and the green 
recovery of the entire region in the post-pandemic period. Montenegro should implement this 
joint regional vision, with high level of ambition, putting sustainable development, resource 
efficiency, nature protection and climate action at the centre of all economic activities. 

Albania, North Macedonia and Serbia seek to  deepen regional  co-operation in  a number of 
areas, notably economic integration through the Open Balkan Initiative (OBI), implementing 
some  elements  of  the  Common  Regional  Market  on  which  no  formal  agreement  has  been 
reached  yet.  Montenegro  has  not  joined.  OBI.  Four  OBI  summits  have  been  held, 
Montenegro participated in the June and September summits as an observer.  

Montenegro  has  continued  to  closely  cooperate  with  Croatia,  Bosnia  and  Herzegovina  and 
Serbia under the Sarajevo Declaration Process, which aims to find sustainable solutions  for 
refugees and displaced persons as a result of the armed conflicts in ex-Yugoslavia during the 
1990s.  Within  the  framework  of  the  Regional  Housing  Programme  (RHP),  417  housing 
units have been built, purchased or reconstructed by end of June 2022 in Montenegro, able to 
accommodate 1 250 persons. Significant challenges remain with regard to the economic and 
social integration and wellbeing for many families, required to ensure sustainability of return.  

The  unresolved  fate  of  missing  persons  who  disappeared  in  relation  to  the  conflicts  of  the 
1990s  remains  a  key  issue  to  be  solved  in  the  Western  Balkans.  Montenegro  continued  to 
actively participate in the Regional Missing Persons Group. There are still 51persons missing 
by June 2022 as a result of the conflict.  

Montenegro generally maintains good bilateral relations with other enlargement countries 
in the region and with neighbouring EU Member States, relations were marked by continued 
cooperation and several high level visits.  

Relations with Albania remained good, with occasional high-level bilateral visits. Maritime 
delimitation between the two countries remains pending.  

Relations  with  Bosnia  and  Herzegovina  remained  good.  The  agreed  border  demarcation  is 
yet to be physically marked. Three joint border crossing points remain to be set up.  

Relations  with  Kosovo  remained  good.  Montenegro  and  Kosovo  signed  a  Memorandum  of 
Understanding on mutual recognition of insurance documents in cross-border traffic.  

10 COM(2019) 640 final. 

78 

 
 
                                                           
Relations  with  North  Macedonia  remained  good.  President  of  North  Macedonia  visited 
Montenegro in April 2022.  

Relations with Serbia remain challenging but both sides signal more willingness to reset the 
relations  and  work  toward  addressing  open  issues.  Ad  hoc  political  spats  between  the  two 
leaderships  took  place.  The  Prime  Miniter  of  Montenegro  visited  Belgrade  in  November 
2021, June 2022 and September 2022.  

Relations  with  Türkiye  remained  stable.  Türkiye’s  President  visited  the  country  in  August 
2021.  The  Deputy  Prime  Minister  and  the  Minister  of  Health  visited  Türkiye  in  October 
2021.  

Relations with  Croatia  remained  good overall. The Prime Minister held  a bilateral  meeting 
with his Croatian counterpart on the margins of the CEI Summit in Budva in November 2021. 
President  of  Montenegro  visited  Croatia  in  December  2021.  There  have  been  no 
developments regarding the pending border demarcation between Montenegro and Croatia.  

Relations  with  Italy  remained  good.  Minister  for  Foreign  Affairs  visited  Italy  in  December 
2021 and had bilateral meetings with the Italian Senate and the Chamber of Communes. 

4. 

ABILITY TO ASSUME THE OBLIGATIONS OF MEMBERSHIP  

CLUSTER 2: INTERNAL MARKET  

This cluster covers chapters 1-free movement of goods, 2-freedom of movement for workers, 
3-right  of  establishment  and  freedom  to  provide  services,  4-free  movement  of  capital,  5-
company law, 7-intellectual property law, 8-competition policy, 9-financial services, and 28-
consumer  and  health  protection.  All  nine  chapters  are  open,  with  closing  benchmarks  that 
remain to be fulfilled in each chapter. This cluster is key for Montenegro’s preparations for 
the  requirements  of  the  EU’s  internal  market  and  is  of  high  relevance  for  early  integration 
and the development of the Common Regional Market. 

Progress  was  achieved  in  different  areas  e.g.  on  market  surveillance,  accreditation  and 
standardisation; stepping up the Employment agency’s capacity on the European network of 
employment  services;  continued  alignment  with  the  Services  Directive;  legislation  on 
accounting;  acquis  alignment  on  intellectual  property  rights.  State  aid  transparency  and 
ordering  recovery  of  unlawful  State  aid;  the  stability  of  the  banking  sector  of  Montenegro 
also  advanced,  as  well  as  legislative  alignment  on  consumer  protection  and  adoption  of 
implementation legislation on health protection. 

In the coming period, Montenegro is invited to focus on the following areas: ensure sufficient 
resources to the market surveillance, standardization and accreditation bodies; strengthening 
acquis implementation for the coordination of social security systems; finalise to establish a 
fully operational Point of Single Contact for regulated professions;  align with the acquis on 
capital movements and payments, including on the acquisition of property rights and monitor 
the phasing out of the investors' citizenship scheme; align with the Transparency Directive; 
adopt the new national intellectual property strategy; improve the track record in the area of 
competition and State aid; complete alignment of national legislation with the EU consumer 
protection and health protection  acquis, including on substances of human origin; complete 
legislative alignment with and implementation of the Capital Requirements Directive and the 
Capital Requirements Regulation.  

Chapter 1: Free movement of goods  

79 

 
 
The free movement of goods ensures that many products can be traded freely across the EU 
based on common rules and procedures. Where products are governed by national rules, the 
principle of the free movement of goods prevents these creating unjustified barriers to trade. 

Montenegro  is  moderately  prepared  in  the  area  of  free  movement  of  goods.  Overall, 
some progress was made, with further alignment with the EU acquis and by taking steps 
towards  the  national  standardisation  body’s  full  membership  of  the  European  Committee 
for  Standardisation 
for  Electrotechnical 
Standardisation (CENELEC). Other recommendations from last year remain  largely valid 
though, and human resources and funding in the sector still remain inadequate. 

the  European  Committee 

(CEN)  and 

In the coming year, Montenegro should in particular: 

  ensure  that  sufficient  human  and  financial  resources  are  allocated  to  its  market 

surveillance, standardisation and accreditation bodies; 

  continue to align with the EU acquis, as envisaged in the relevant action plan under this 
technical  requirements,  conformity 

chapter,  notably  horizontal 
assessment and market surveillance of products;  

legislation  on 

  ensure  the  implementation  and  enforcement  of  the  Montenegrin  legislation  on 

chemicals management that is aligned with the EU acquis. 

General principles 

Montenegro  continued  to  progress  on  its  alignment  with  the  EU  acquis  on  the  free 
movement of goods, as laid down in the relevant national action plan. In particular, the Law 
on standardisation and the  Law on ratification of the convention on the establishment of an 
international  organisation  for  legal  metrology  were  adopted  in  December  2021.  Market 
surveillance, standardisation  and accreditation bodies still do not  have adequate human and 
financial resources to implement the EU acquis.  

Non-harmonised areas  

Montenegro continued to implement its action plan for compliance with Articles 34-36 of the 
Treaty for the European Union (TFEU) on prohibition of quantitative restrictions.  

Harmonised area: quality infrastructure 

As  concerns  standardisation,  the  Institute  for  Standardisation  of  Montenegro  (ISME) 
published 2 654 Montenegrin standards aligned with the EU standards. By the first quarter of 
2022,  CEN/CENELEC  evaluated  the  ISME  adoption  rate  at  almost  88  %  of  European 
standards at the national level (86.17 % CEN standards and 92.01 % CENELEC standards). 
ISME  became  a  full  member  of  the  International  Organisation  for  Standardisation  (ISO)  in 
July  2021.  Moreover, 
full  membership  of 
CEN/CENELEC  in  December  2021,  and  CEN/CENELEC  peer  assessment  is  ongoing. 
However,  the  human  resources  situation  of  ISME  has  yet  to  be  addressed  (only  65  %  of 
systematised job positions are filled). 

ISME  submitted 

its  application 

for 

On  metrology,  the  main  national  legislation  is  aligned  with  relevant  EU  acquis,  and  three 
pieces  of  implementing  legislation  were  adopted  on  certification  criteria,  technical  and 
metrological  conditions,  and  professional  staff  levels  and  procedures.  During  the  reporting 
period,  45  conformity  assessment  bodies  were  accredited  by  the  Accreditation  Body  of 
Montenegro (ATCG), including 28 testing laboratories, 2 calibration laboratories, 2 medical 
examination laboratories, 8 inspection bodies, 3 bodies for products certification and 3 bodies 
for the certification of management systems.  In November 2021, the European Cooperation 
for  Accreditation  (EA)  performed  a  pre-evaluation  of  ATCG,  identifying  five  non-

80 

 
 
conformities, which were resolved by ATCG in April 2022. A full evaluation of ATCG prior 
to the signature of an EA Multilateral Agreement is foreseen to take place in November 2022. 

On market surveillance of products, 2 137 inspections were carried out (1 754 inspections 
in  proactive  and  383  inspections  in  reactive  surveillance)  as  compared  to  2  211  in  the 
previous  reporting  period.  A  total  of  931  types  of  dangerous  and  non-compliant  products 
were identified (59 041 items). Administrative measures have been imposed accordingly, as 
appropriate. The Administration for Inspection Affairs should be further reinforced. 

Harmonised area: sectoral legislation 

Regarding  ‘new  and  global  approach’  product  legislation,  in  order  to  ensure  further 
alignment  with  the  EU  acquis,  Montenegro  amended  implementing  legislation  in  the 
construction  sector  (transitioning  to  Eurocodes),  and  in  the  areas  of  medical  devices  and 
personal protective equipment.  

Similarly,  on  ‘old  approach  product  legislation’,  implementing  legislation  on  chemical 
classification (Globally Harmonised System of the UN), cosmetic products, transparency of 
measures regulating the prices  of medicinal products and prohibited substances  in  cosmetic 
products was adopted, to improve the level of alignment to the relevant EU acquis. 

Chapter 2: Freedom of movement for workers  

Citizens of one Member State have the right to work in  another Member State and must be 
given the same working and social conditions as other workers. 

Montenegro has some level of preparation in this area. Limited progress was achieved in 
the  reporting  period  on  social  security  systems  and  in  particular  on  last  year’s 
recommendation to step up the capacity of the Employment Agency. 

In the coming year, Montenegro should in particular: 

  continue to work on strengthening structures to implement the EU acquis in the area and 

in particular as concerns the coordination of the social security systems. 

On  30  July  2021,  the  government  re-established  the  Chapter  2  Working  Group.  Its 
composition includes relevant social and civil society partners. In September 2021, the 2021-
2025 strategy on migration and reintegration of returnees in Montenegro and its action plan 
for 2021-2022 were adopted. 

On  access  to  the  labour  market,  there  were  no  legislative  developments.  The  Law  on 
foreigners  governs  entry,  stay  and  work  of  foreign  citizens.  Specific  provisions  for  EU 
nationals are included in the law on foreigners and will apply as of the date of accession. For 
2022, the government set the annual number of permits for temporary residence and work of 
foreigners to  20 454, almost identical  to  2021. Procedures  for handling  foreigners’ requests 
for 
through  Montenegro`s 
representations in countries of origin remain to be finalised. 

temporary  residence  and  seasonal  employment  permits 

In preparation to join EURES (European network of employment services) upon accession, 
efforts  have  been  stepped  up  to  improve  the  current  institutional  set-up  and  administrative 
and  technical  capacities  of  the  Employment  Agency  of  Montenegro.  This  includes  IT 
hardware  and  software  specifications,  enabling  the  future  participation  to  EURES  and 
preparing a twinning project on capacity strengthening, to start in the second half of 2022. 

On the coordination of the social security systems, the number of bilateral  agreements in 
force  remained  at  25  without  further  developments.  The  bilateral  agreement  with  Romania 
has  yet  to  be  signed.  Amendments  to  those  with  Serbia  and  with  Bosnia  and  Herzegovina 

81 

 
 
remain  to  be  concluded.  The  Interdepartmental  Working  Group  for  the  Coordination  of 
Social Security Systems was set up in January 2022 with the aim to facilitate the cooperation 
in this area. 

The  European  Health  Insurance  Card  is  recognised  under  the  law  on  compulsory  health 
insurance but will be introduced after accession. The number of agreements with EU Member 
States  on  the  use  of  the  card  remained  at  five  (Austria,  Germany,  Luxembourg,  Slovakia, 
Slovenia). There were no further developments in recruitment of the coordination staff in the 
regional units of the Health Insurance Fund. 

Chapter 3: Right of establishment and freedom to provide services  

EU natural and legal persons have the right to establish themselves in any Member State and 
to provide cross-border services. For certain regulated professions, there are rules on mutual 
recognition of qualifications. Postal services are gradually being opened up to competition. 

Montenegro remains moderately prepared in this area. Limited progress was made during 
the  reporting  period,  on  the  establishment  of  a  Point  of  Single  Contact,  further  alignment 
with  the  Services  Directive,  and  continuation  of  electronic  registration  as  per  last  year’s 
recommendations. 

In the following period, Montenegro should in particular: 

  establish a fully operational Point of Single Contact; 

  continue inter-ministerial coordination and fully align with the EU Services Directive;  

  complete alignment with the EU postal acquis, including the Regulation on cross-border 

parcel delivery services. 

On the right of establishment and freedom to provide cross  -border services, alignment 
of the implementing legislation with the EU Services Directive continued, albeit at a slower 
pace. Establishment of the Point of Single Contact for services (PSC) is supported through an 
EU  technical  assistance  project.  Upgrading  the  administrative  capacity  in  the  Services 
Department  of  the  Ministry  of  Economic  Development  should  be  a  priority.  Electronic 
company registration was further pursued (see also chapter 6 Company law). 

On  postal  services,  the  legislation  is  aligned  with  the  EU  Postal  Services  Directive.  Postal 
services  market  remains  fully  open  to  competition.  Montenegro  should  still  ensure  full 
alignment  with  the  EU  postal  acquis,  including  with  the  Regulation  on  cross-border  parcel 
delivery  services.  The  number  of  postal  operators  increased  by  4  to  30  operators.  The 
implementation  of  the  2021-2022  action  plan  on  the  postal  development  strategy  has 
progressed as planned. 

On the mutual recognition of professional qualifications, Montenegro has a satisfying level 
of alignment with  the EU  acquis. A follow up on foreseen measures set  out  in  the national 
plan  to  develop  qualifications  for  regulated  professions  is  still  needed  to  ensure  continuous 
alignment. 

Chapter 4 - Free movement of capital  

In  the  EU,  capital  and  investments  must  be  able  to  move  without  restriction  and  there  are 
common rules for cross-border payments. Banks and other economic operators apply certain 
rules to support the fight against money laundering and terrorist financing.  

Montenegro  is  moderately  prepared  in  this  area.  Some  progress  was  made  on  the 
strategic  framework  for  the  prevention  of  terrorism,  money  laundering  and  terrorism 
financing.  The  legal  framework  on  payment  systems  was  further  aligned  with  the  EU 

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acquis.  Montenegro  decided  to  extend  the  life  of  its  investor  citizenship  scheme  for  an 
additional 12 months until  December 2022, despite the previously  announced decision to 
end the scheme in 2021, and despite the recommendations by the Commission to phase the 
scheme out as soon as possible.  

Last  year’s  recommendations  remain  largely  valid.  In  the  coming  year,  Montenegro 
should: 

  continue  aligning  with  the  EU  acquis  on  capital  movements  and  payments,  including 

on the acquisition of property rights; 

  strengthen  the  anti-money  laundering  supervision  of  the  non-financial  sector, 
particularly  in  high  risk  areas  such  as  the  games  of  chance,  by  amending  the  law  on 
games  of  chance  and  the  law  on  the  prevention  of  money  laundering  and  terrorism 
financing;  

  phase out of the investors' citizenship scheme, while continuing to monitor it as long as 

it runs, to prevent risks related to money laundering. 

On  capital  movements  and  payments,  since  2017  Montenegro  has  a  regime  of  free 
movement  of  capital,  no  limitation  on  the  transfer  of  property,  and  no  foreign  exchange  or 
currency  control.  However,  full  alignment  with  the  EU  acquis  has  not  been  achieved.  The 
adoption  of  a  new  insurance  law  remains  pending.  Montenegro  has  yet  to  implement  its 
obligations under the Stabilisation and Association Agreement as regards amending the Law 
on ownership rights, removing preferential treatments and ensuring that EU citizens can buy 
real estate or farming land under the same conditions as Montenegro citizens. 

As  regards  the  payment  system,  amendments  to  the  Law  on  payment  system,  aimed  at 
aligning the law with the Payment Services Directive 2, have yet to be adopted. The Law on 
comparability of fees related to consumer payment accounts, payment accounts switching and 
access payment accounts with basic features, and  the Law on interchange fees and separate 
business  rules  concerning  payment  cards  were  adopted  in  December  2021.  The  drafting  of 
implementing legislation is in process. 

Montenegro  currently  has  three  licensed  payment  institutions  and  22  agents  registered  in 
payment institutions. In 2021, the Central Bank of Montenegro revoked from one electronic 
payment institution the authorisation for issuing e-money and for providing payment services. 
Seven inspections of operations of payment institutions were performed by the Central Bank 
to check the compliance in the area of payment operations. Misdemeanour proceedings were 
initiated against four banks.   

On anti-money laundering and terrorism financing, the government adopted in December 
2021  the  strategy  for  the  prevention  and  suppression  of  terrorism,  money  laundering  and 
terrorism  financing  for  2022-2025.  An  implementing  legislation  to  the  Law  on  prevention 
and  suppression  of  money  laundering  and  terrorist  financing  was  adopted  on  indicators  for 
recognizing  suspicious  customers  and  transactions.  The  process  of  alignment  of  the  legal 
framework on the prevention of money laundering and terrorism financing with the fifth EU 
Anti-Money  Laundering  Directive  and  with  the  recommendations  of  the  Financial  Action 
Task  Force  (FATF)  is  on-going.  However,  the  Law  on  games  of  chance  has  yet  to  be 
amended  in  order  to  strengthen  the  supervision  of  the  non-financial  sector  in  this  high-risk 
area.  The  Law  on  international  restrictive  measures,  a  crucial  legislation  in  the  context  of 
international and EU sanctions, has yet to be aligned with EU standards. 

In  2021,  the  Central  Bank  conducted  six  inspections  of  financial  institutions  to  check  their 
compliance  with  the  anti-money  laundering  and  anti-terrorist  financing  legal  framework. 

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More targeted inspections were carried out in three banks, and five inspections of reporting 
entities were aimed at checking the fulfilment of measures previously imposed.   

The Financial Intelligence Unit (FIU) is embedded in Ministry of Interior since the adoption 
of a new Law on internal affairs in June 2021. In 2021, the FIU conducted 130 controls of 
reporting  entities,  resulting  in  the  issuance  of  124  misdemeanour  orders.  The  FIU  received 
299  suspicious  transactions  reports  from  taxpayers  and  38 876  reports  on  suspicious  cash 
transactions.  In  2021,  12  orders  of  temporary  suspension  of  transactions  were  issued  for  a 
total  amount  of  EUR  3.6  million  and  USD  129 207.  Some  38  orders  of  continuous 
monitoring  of  accounts  against  money  laundering  suspicions  were  issued.  Some  62 
notifications were sent by the FIU to law-enforcement authorities.  

On 30 December 2021, Montenegro decided to extend its investor citizenship programme 
(‘Special Investment Program of Special Importance for the Industry and Economic Interest 
of  Montenegro’)  for  an  additional  12  months  until  December  2022,  despite  the  previously 
announced decision to end the programme in 2021, and despite the recommendations by the 
Commission  to  phase  the  scheme  out  as  soon  as  possible.  In  March  2022,  the  Ministry  of 
Interior  adopted  stricter  internal  and  external  checks  for  all  applications,  which  resulted  in 
freezing  the  process  of  pending  applications  for  the  time  being.  Additional  checks  for 
applicants from Russia and Belarus were added in May 2022. However, new amendments to 
the decision adopted in June 2022 lowered the financial criteria for acquiring citizenship. A 
bank  guarantee  amounting  to  EUR  1  million  is  now  required,  instead  of  EUR  2.5  million 
previously. The amendments also allowed the beneficiaries of the programme to add children 
borne after the submission  of the request  to  the  list  of family members  granted citizenship. 
This  scheme  poses  risks  such  as  money  laundering,  tax  evasion,  terrorism  financing, 
corruption  and  infiltration  of  organised  crime  and  should  be  terminated.  Past  citizenship 
decisions  should  also  be  reviewed  against  the  security  risks  they  present  in  the  context  of 
Russia’s unprovoked aggression against Ukraine. Between January 2019 and May 2022, 934 
applications  have  been  lodged  (279  applicants  and  655  family  members);  409  applications 
have  been  accepted  and  3  applications  rejected;  522  applications  are  being  evaluated  (152 
applicants  and 370 family  members).  In total,  333 Montenegrin passports have been issued 
under the scheme.  

Chapter 6: Company law  

The  EU  has  common  rules  on  the  formation,  registration  and  disclosure requirements  of  a 
company,  with  complementary  rules  for  accounting  and  financial  reporting,  and  statutory 
audit. 

Montenegro has a good level of preparation on company law. Some progress was made 
by  adopting  the  Law  on  Accounting  and  on  transparency.  The  recommendation  to  adopt 
the  related  rulebook  on  company  financial  statements  and  other  recommendations  from 
2021 remain valid. 

In the coming year, Montenegro should therefore, in particular: 

  adopt the rulebook on company financial statements; 

  further align with the EU acquis on company law; including on encouragement of long-

term shareholder engagement; 

  complete alignment with the Transparency Directive, including the sanctioning regime. 

On company law, no progress was made to ensure alignment with the EU acquis in this area. 
Further legislative alignment is necessary with the 2019 EU acquis on the use of digital tools, 

84 

 
 
the  encouragement  of 

long-term  shareholder 
cross-border  operations  and  rules  on 
engagement. In this context, two working groups were established concerning the revision of 
the  Law  on  business  organisations  and  drafting  a  law  on  registration  of  business  and  other 
entities. The database of companies in the business register should be ready to interconnect 
with EU Member States’ business registers in the future. There is a risk that the revision of 
the  Corporate  Governance  Code  -  in  the  work  programme  of  the  Capital  Market  Authority 
(CMA)  for  2022  -  will  not  be  completed  in  2022.  Alignment  with  the  acquis  on  employee 
participation in cross-border mergers is still pending. 

On  Transparency,  the  CMA  has  established  a  central  registry  of  regulated  information, 
which is the official mechanism for collecting, storing, controlling and publishing regulated 
information.  It  has  a  high  degree  of  automation  and  electronic  communication  between 
participants  at  the  capital  market.  Legislative  work  is  underway  to  achieve  full  acquis 
alignment on transparency, including on the sanctioning regime. 

On  company  reporting  and  statutory  audit,  the  law  on  accounting  aimed  at  acquis 
alignment has been adopted in December 2021. However, the rulebook on company financial 
statements still needs to be adopted. Currently, all companies must comply with international 
financial  reporting  standards  (IFRS  /  IFRS  for  SMEs),  while  reduced  obligations  exist  for 
micro  and  small  companies  (balance  sheet  and  profit  and  loss  account  only).  The  Law  on 
auditing contains the essential elements in line with EU requirements, and Montenegro has a 
public  audit  oversight  body  (POB),  independent  of  the  profession.  Statutory  audits  are 
performed  based  on  international  auditing  standards  (ISAs)  and  are  mandatory  for  public-
interest  entities.  Human  resource  capacities  at  the  Department  for  Audit  Oversight  need 
strengthening, with a very limited number of quality inspections carried out.   

Chapter 7: Intellectual property law  

The EU has harmonised rules for the legal protection of intellectual property rights (IPR), as 
well  as  rules  for  the  legal  protection  of  copyright  and  related  rights.  Rules  for  the  legal 
protection  of  IPR  cover,  for  instance,  patents  and  trademarks,  designs,  biotechnological 
inventions and pharmaceuticals. Rules for the legal protection of copyright and related rights 
cover, for instance, books, films, computer programmes and broadcasting. 

Montenegro  has  a  good  level  of  preparation  on  intellectual  property  law.  Overall,  some 
progress was made, with good progress on alignment with the EU acquis and preparation 
of  a  new  national  intellectual  property  strategy,  and  limited  progress  in  track  record  on 
investigations,  prosecutions  and  judicial  follow-up.  Last  year’s  recommendations  have, 
therefore, been only partially addressed and remain largely valid.  

In the coming year, Montenegro should in particular:  

  adopt  and  start  implementing  a  new  and  comprehensive  national  intellectual  property 

strategy 2023-2026;  

  complete  legislative  alignment  on  copyright  and  neighbouring  rights,  industrial 

property rights and enforcement of intellectual property rights; 

  improve its track record on investigations, prosecutions and judicial follow-up. 

On copyright and neighbouring rights, alignment with the Collective Rights Management 
Directive  was  achieved  through  amendments  to  the  law  on  copyright.  The  Parliament  also 
adopted the Law on ratification of the Marrakesh Treaty. Further legislative amendments to 
complete  alignment  on  copyright  and  neighbouring  rights  are  pending  adoption.  Operating 
licences were issued to two collective management organisations (PAM CG and OFA).  

85 

 
 
Concerning  industrial property  rights, Parliament  adopted the  Law on protection of trade 
secret, the Law on ratification of the European Patent Convention and amended the Law on 
patents  to  implement  the  European  Patent  Convention.  Further  amendments  to  the  Law  on 
patents,  aimed  at  aligning  with  the  EU  acquis  on  supplementary  protection  certificates  and 
amendments to the Law on trademarks are pending adoption by the Parliament as is the Law 
on ratification of the Singapore Treaty on the law on trademarks. Preparations for accession 
to the European Patent Convention (EPC) and the European Patent Organisation (EPO) are in 
their final stages. 

On  enforcement,  reports  are  regularly  submitted  to  the  European  Commission  on  the 
implementation of intellectual property rights. The reporting format on customs enforcement 
of intellectual property rights remains to be fully aligned with Montenegro’s future reporting 
obligations  to  the  Commission.  The  track  record  on  criminal  investigation  and  prosecution 
remains to be improved in line with EU and international standards. Ex-officio powers should 
be  reinforced  in  this  respect.  Sanctions  and  penalties  imposed  for  intellectual  property 
infringements appear to be too low to have a deterrent effect. 

The  COVID-19  pandemic  reduced  the  scope  of  activities  of  the  working  group  against 
infringements of intellectual property rights. In July 2021, a new Coordination Team for the 
implementation of intellectual property rights was created. A day of joint action took place in 
Kotor  where  compliance  of  economic  entities  with  IPR  was  controlled  and  information 
material  distributed.  The  action  plan  of  the  working  group  for  2022  was  adopted.  Due  to 
numerous restructuring of entities in charge of IPR there is an evident shortfall of staff. 

In the reporting period, in cooperation with the European Union Intellectual Property Office 
(EUIPO), Montenegro implemented several IT tools for the protection of IPR.  

Preparations  of  Montenegro’s  new  national  intellectual  property  strategy  2023-2026 
progressed and its adoption is planned by the end of 2022 together with an action plan. It will 
be  important  to  ensure  that  the  strategy  will  address  the  remaining  identified  shortcomings 
and IPR enforcement recommendations from the 2018 peer review report. 

Chapter 8: Competition policy  

EU rules protect free competition. They include antitrust rules against restrictive agreements 
between companies and abuse of dominant position, and also include rules on concentrations 
between companies which would significantly impede effective competition. EU rules also set 
out  a  system  of  State  aid  control.  Governments  are  only  allowed  to  grant  State  aid  if 
restrictive conditions are met, with a view to preventing distortion of competition. 

Montenegro  is  moderately  prepared  in  this  area.  Some  progress  was  made  by  further 
following  up  the  Montenegro  Airlines  case  and  including  aid  to  Air  Montenegro  in  the 
2020 report on State aid. Transparency increased with establishing and the use of State aid 
registers as well as timely publishing of decisions and opinions by the State aid authority. 
Last year’s recommendation on non-notified State aid for Montenegro Airlines and others 
remain to be completed.  

In the coming year Montenegro should in particular: 

  conclude the Montenegro Airlines case and follow up on the establishment of the new 
national  air  carrier  branded  Air  Montenegro,  as  well  as  close  other  ongoing 
investigations of non-notified State aid and recover the corresponding funds;  

  in  addition  to  ensuring  transparency  on  all  State  aid  decisions  and  operational 
independence of the State aid authority, proceed with legislative preparations to devise 

86 

 
 
the Agency for the Protection of Competition with power to impose fines; 

  further  improve  the  track  record  in  the  areas  of  antitrust/mergers  and  State  aid  by 
providing appropriate staffing of the APC, building up administrative capacities of the 
Agency  and  misdemeanour  courts,  further  promoting  the  use  of  leniency  policy  and 
carrying out more in-depth investigations and on-site inspections. 

Antitrust and mergers 

The legislative framework provides a good level of alignment with the EU  acquis and the 
Stabilisation and Association Agreement (Articles 101 and 102 TFEU).  Parliament adopted 
amendments to the Law on Protection of Competition in December 2021, primarily to align it 
with  the  Law  on  State  Administration  as  concerns  staff  selection  criteria  and  certain  work 
planning arrangements. 

On  the  institutional  framework,  the  APC  is  responsible  for  implementing  the  legal 
framework. It is an operationally independent authority. The powers of the APC are broadly 
comparable  to  those  of  the  European  Commission  in  the  area  of  antitrust  and  mergers. 
Decisions  are  taken  by  the  Council  of  the  APC,  and  can  be  appealed  before  the 
Administrative Court. Fines can still only be imposed by misdemeanour courts, not directly 
by  the  APC.  A  leniency  policy  for  self-reporting  cartel  members  is  in  place,  but  real 
implementation is lacking due to the still low level of fines imposed by misdemeanour courts.  

On  enforcement  capacity,  the  APC’s  administrative  and  financial  capacities  remain  to  be 
strengthened.  Only  11  out  of  the  18  foreseen  posts  in  area  of  antitrust  and  mergers  are 
occupied, similarly to  the previous reporting period.  A new President  and new members of 
the APC Council were appointed in April 2022.  

On implementation, in the area of prohibited agreements, the APC issued two decisions in 
the reporting period (three in total for the year 2021) and two new proceedings were initiated. 
The  total  number  of  ongoing  misdemeanour  proceedings  is  8.  However,  the  majority  of 
proceedings  processed  in  the  reporting  period  faced  either  acquittal  by  the  Misdemeanour 
Court,  leading  to  an  appeal  of  the  APC  before  the  High  Misdemeanour  Court,  or 
administrative disputes initiated before the Administrative Court. The numbers and amounts 
of  fines  imposed  by  misdemeanour  courts  remained  low,  with  only  one  case  and  fines  of 
EUR  900.  Due  to  the  high  number  of  appeals  the  completion  of  these  cases  is  additionally 
protracted,  preventing  APC  from  building  its  track  record  and  initiating  new  cases.  In  the 
reporting period, the Agency resolved two initiatives to investigate competition violations.  

There were no decisions adopted in the area of abuse of a dominant position. In the area of 
concentrations,  in  2021,  70  mergers  were  approved,  compared  to  50  in  2020,  whereas 
between  January-June  2022,  the  Agency  issued  a  total  of  32  decisions.  One  in-depth 
investigation  of  a  merger  and  two  dawn  raids  were  reported.  The  leniency  policy  was  not 
applied, similarly to the previous periods. The APC issued 14 opinions on legislation in the 
reporting  period.  To  build  its  track  record  in  the  area  of  antitrust  and  mergers,  the  APC 
should  increase  the  number  of  resolved  cases.  The  APC  needs  to  fully  use  its  enforcement 
powers, carrying out  more on-site inspections and further promoting the use of its leniency 
policy  as  a  means  to  uncover  cartels.  Finally,  the  courts’  capacity  to  handle  complex 
competition cases and impose stricter fines remains to be significantly strengthened. 

State aid 

The  legislative  framework  is  largely  in  line  with  the  EU  acquis  (Articles  107  and  108 
TFEU) and the SAA. The 2018 Law on State aid control sets out the notion of aid as well as 
procedural State aid rules. The last Sixth Amendment of the Temporary Framework for State 

87 

 
 
aid  measures  to  support  the  economy  in  the  current  COVID  19  pandemic  was  adopted  in 
February 2022. Some secondary legislation was adopted in the reporting period.  

As regards the institutional framework, the Agency for Protection of Competition (APC) is 
responsible  for  implementing  the  legal  framework.  The  powers  of  the  APC  are  broadly 
comparable to those of the European Commission in the area of State aid. Decisions are taken 
by the Council of the APC, and can be appealed before the Administrative Court. 

The enforcement capacity of the APC Council remains to be strengthened. Only seven out 
of ten positions are filled in the Sector for State Aid Control, similarly to the previous year.  

On implementation, in the reporting period the APC issued 30 decisions, 13 opinions, while 
19  cases  are  in  procedure  -  a  significant  increase  compared  to  previous  years.  Concerning 
State aid to Montenegro Airlines, a third decision has been adopted in August 2022 ordering 
further  recovery  of  illegal  State  aid.  The  Ministry  of  Capital  Investments  is  still  to  adopt  a 
plan for the recovery of incompatible State aid and to take actions to recover aid as per the 
instructions of APC. The latter confirms the need to further increase the enforcement powers 
of the APC.  

The  APC,  in  the  field  of  State  aid,  has  not  yet  published  opinions  or  decisions  on  possible 
State aid in the energy sector, such as on coal subsidies. The APC should continue to monitor 
implementation  of  State  aid  rules  in  large  projects  undertaken  in  cooperation  with  third 
countries. Last year’s recommendation to provide the APC with the means and information in 
this regard has been partially addressed, since the Ministry of Capital Investments and other 
competent authorities provided only partial information.  

Montenegro  made  progress  towards  ensuring  transparency  on  State  aid  decisions,  with  the 
decisions  and  opinions  being  timely  published  on  the  Agency’s  website.  Additionally,  the 
general  register  of  State  aid  cases  was  created  in  the  reporting  period,  which  can  further 
contribute  to  the  transparency  along  with  the  two  specialised  registers  (COVID  and  de 
minimis). Each major grantor of aid appointed responsible persons to enter information in the 
registers.  The  APC’s  database  is  increasing.  All  concerned  institutions  should  further 
contribute  to  strengthening  the  position  of  the  APC  and  its  Council  thus  ensuring  an 
independent  and  functioning  system  of  State  aid  control,  which  is  fundamental  for 
Montenegro’s  progress  on  its  path  into  the  European  Union.  The  APC  should  continue  to 
advocate  for  further  strengthening  awareness  of  State  aid  rules  among  aid  grantors  at  both 
central and local levels. 

Liberalisation 

The Law on the protection of competition and the Law on State aid control apply to public 
undertakings and undertakings with special or exclusive rights. This does not apply to cases 
where the laws would obstruct the performance of the particular tasks of services of general 
economic interest (SGEI) assigned to such undertakings, in line with Article 106 TFEU and 
with the SAA. There are no monopolies of a commercial character as provided for in Article 
37 TFEU. 

Chapter 9: Financial services  

EU  rules  aim  to  ensure  fair  competition  between  and  the  stability  of  financial  institutions, 
namely  banking,  insurance,  supplementary  pensions,  investment  services  and  securities 
markets. They include rules on authorisation, operation and supervision of these institutions.  

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Montenegro  is  moderately  prepared  in  the  area  of  financial  services.  Overall,  some 
progress was achieved in the reporting period, with good progress in the area of bank and 
financial conglomerates, some progress  on insurance  and no progress  on capital  markets. 
Last year’s recommendations were met to a substantial degree in the banking area.  

In the coming year, Montenegro should: 

  Complete  legislative  alignment  with  and  implementation  of  the  capital  requirements 

and bank recovery and resolution legislation,  

  Advance work on the drafts of the Law on Insurance, Law on investment funds, Law 
on alternative investment funds and Law on pension funds, aligned with EU legislation.  

The  legislation  is  partially  aligned  with  the  EU  acquis  on  banks  and  financial 
conglomerates. Laws on credit institutions and on resolution of credit institutions and most 
of their implementing legislation (aimed at alignment with Basel III standards) have applied 
since January 2022, bringing the legal framework closer to the current EU rules. Work is still 
ongoing  on  adopting  and  implementing  some  of  the  related  regulatory  acts  and  documents 
that  were  produced  by  the  European  Banking  Authority  (EBA)  and  the  Single  Resolution 
Board (SRB). Work is also in progress on further changes to the banking legislation, aimed at 
alignment with the latest EU rules on the resolution of credit institutions.  

The  Central  Bank  of  Montenegro  (CBM),  in  cooperation  with  the  EBA,  initiated  the 
procedure  for  assessing  the  equivalence  of  Montenegro’s  regulatory  and  supervisory 
framework  for  credit  institutions  with  EU  rules.  The  CBM  also  started  negotiating  a 
cooperation agreement with the SRB on the exchange of information and cooperation in the 
area  of  resolution  planning  and  implementation  for  banks  and  financial  conglomerates 
operating on a cross-border basis.  

The CBM adopted, since the outbreak of the COVID-19 crisis, eleven packages of temporary 
measures  to  mitigate  the  impact  of  the  pandemic  on  the  banking  sector  and  improve  the 
country’s financial stability. The independent review of the asset quality in all banks (AQR), 
which started in February 2020, was completed in September 2021. The results of the AQR 
exercise  confirmed  the  stability  of  the  banking  sector  of  Montenegro,  a  satisfactory  asset 
quality and capital adequacy of the banking system. The solvency ratio of the banking sector, 
adjusted after the AQR was finalised, amounted to  16.2%, substantially above the statutory 
minimum of 10%.  

On  insurance  and  occupational  pensions,  the  Insurance  Supervision  Agency  (ISA) 
continued working on the new Law on insurance, which should ensure further alignment with 
the  main  EU  acquis,  the  Solvency  II  Directive  and  the  Insurance  Distribution  Directive.  In 
parallel,  adjustments  to  the  current  Law  on  insurance,  expanding  the  powers  of  ISA  in 
preparation for its future role, entered into force. Changes to the Law on compulsory traffic 
insurance, allowing for the alignment with the Motor Vehicles Directive, entered into force in 
January 2022.   

On  financial  market  infrastructure,  securities  markets  and  investment  services,  legal 
alignment with the EU acquis on investment funds (UCITS Directive), alternative investment 
funds (AIFMD Directive) and pension funds (IORP Directive) remains pending.  

Chapter 28: Consumer and health protection  

EU rules protect consumers’ economic interests and in relation to product safety, dangerous 
imitations and liability for defective products. The EU also ensures high common standards 
for  tobacco  control,  blood,  tissues,  cells  and  organs.  The  EU  also  ensures  high  common 

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standards  for  upholding  patients’  rights  in  cross-border  healthcare  and  tackling  serious 
cross-border health threats including communicable diseases. 

Montenegro  is  moderately  prepared  on  consumer  and  health  protection.  Overall,  limited 
progress was made on last year’s recommendations, notably regarding alignment to the EU 
acquis  in  the  field  of  health  protection,  whereas  some  progress  was  made  in  the  area  of 
consumer  protection  and  improving  the  capacity  for  its  implementation.  Therefore, 
recommendations from last year remain broadly valid. 

In the coming year, Montenegro should: 

  complete the alignment of national legislation with the EU consumer protection acquis, 
as well as the alignment of national legislation with the EU health protection  acquis on 
substances  of  human  origin,  tobacco  control  and  patients’  rights  in  cross-border  health 
care; 

  reinforce  administrative  capacities  to  ensure  the  full  implementation  of  the  EU  acquis 

under this chapter; 

  adopt a new strategy for the development of the healthcare system in Montenegro. 

Consumer protection  

Regarding  the  legislative  framework  for  consumer  protection,  the  Law  on  consumer 
protection was amended in December 2021 in order to ensure alignment with the EU acquis, 
but it still needs to be further aligned with the latest EU consumer protection legislation. The 
law enabled a new Consumer Protection Council to be established, the main role of which is 
continuous  enforcement  and  implementation  of  consumer  protection  rules.  A  national 
consumer  protection  programme  2022-2024  was  also  adopted.  Legislation  on  alternative 
dispute resolutions and consumer credits is aligned with the EU acquis, except in the area of 
consumer credits related to residential immovable property. Full alignment of  legislation on 
market surveillance of products has yet to be completed. Between December 2021 and March 
2022,  Montenegrin  authorities  competent  for  consumer  protection  carried  out  a  joint 
extensive  action  to  control  online  trade  market,  including  systemic  checks  (“sweeps”), 
equivalent  to  those  implemented  at  the  EU  level.  Following  the  control  of  websites  of  62 
business  entities  engaged  in  the  sale  of  goods  in  sectors  such  as  clothing,  household  goods 
and  electrical  appliances,  shortcomings  were  identified  and  addressed,  resulting  in  higher 
share of websites that are in line with the rules of distance selling of goods and services.    

The central information system for consumer protection was updated to facilitate consumer 
complaints in autumn 2021. Administrative capacities of the Administration for Inspection 
Affairs  were  strenghtened  by  hiring  11  inspectors  for  consumer  protection.  31  629 
inspections  were  performed  in  the  field  of  consumer  protection,  identifying  4  021 
irregularities leading to administrative and punitive measures. 

On product safety, Montenegro’s legal basis is designed to be aligned with the EU acquis. 2 
253  inspections  were  conducted,  including  1  822  inspections  in  the  context  of  proactive 
surveillance and 247 inspections in reactive surveillance, identifying 944 dangerous products 
(31 320 items). Accordingly, administrative measures were imposed, including withdrawal of 
products from the market as well as permanent or temporary circulation ban, destruction and 
return  to  the  producer/distributor.  Withdrawal  of  products  from  the  market  (permanent 
circulation  ban)  for  dangerous  and  non-compliant  products  was  imposed  on  315  product 
types, in the amount of 33 845 pieces. 

Public health  

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On  public  health,  national  legislation  on  healthcare  remains  partly  aligned  with  the  EU 
acquis.  In  2021,  the  health  budget  (6.811  %  of  GDP)  decreased  slightly,  compared  with 
2020.  Montenegro’s  integrated  health  information  system  was  used  at  the  primary, 
secondary and tertiary care level, following the completion of the information system in the 
Clinical Centre of Montenegro (CCM). Connecting the information systems of CCM and the 
Institute  for  Public  Health  (IPH)  has  not  been  completed.  Currently  there  is  no  strategy  in 
place for the development of the health sector in general. 

Despite some actions by relevant institutions/bodies, the issue of anti-microbial resistance is 
still insufficiently addressed. In view of the application of the EU guidelines for decreasing 
the use of antibiotics, Montenegro adopted a Programme on bacterial resistance to antibiotics 
control with the related action plan 2022-2024 in June 2022 and has a national surveillance 
system  in  place  for  antimicrobial  resistance  in  humans.  Generally,  antibiotics  and  other 
medicines were prescribed less in 2021 than in previous years.  

On  tobacco  control,  the  national  legislation  on  smoking  in  public  places  and  the  sale  of 
tobacco  products  to  minors  is  still  not  sufficiently  enforced,  even  though  there  was  some 
limited reinforcement of the capacities of relevant inspectors.  

On  alcohol  related  harm  reduction,  the  government  adopted  a  programme  and  an  action 
plan  for  the  prevention  of  harmful  use  of  alcohol  and  disorders  caused  by  alcohol 
consumption  for  the  period  2022-2024.  On  drug  abuse  prevention  and  harm  reduction, 
efforts  focused  on  treatment  and  prevention  actions  are  organised  by  the  civil  society 
organisations.  Opioid  substitution  treatment  is  available  at  primary  health  care  centres. 
However,  the  rehabilitation  and  social  integration  of  drug  addicts  was  problematic,  as  they 
needed  to  participate  themselves  in  covering  the  costs  of  the  rehabilitation  programmes 
provided by a state centre. Adequate support to minor drug users with mental diseases is not 
available, and there is no specific healthcare entity for this group of drug users.  

The  2021-2023  action  plan  for  the  implementation  of  the  strategy  for  the  improvement  of 
mental health (2019-2023) was adopted in November 2021.  

On  blood,  tissues,  cells  and  organs,  the  national  blood  transfusion  institute  adopted  its 
criteria for the selection of blood donors after immunisation with COVID-19 vaccine, which 
are harmonised with the recommendations of the European Centre for Disease Prevention and 
Control  (ECDC).  In  the  field  of  substances  of  human  origin,  Montenegro  has  adopted 
implementing legislation in order to further align with the relevant EU acquis.  

National legislation on patients’ rights in cross-border healthcare is partly aligned with the 
EU acquis. In the field of serious cross-border health threats and communicable diseases, 
the  Institute  for  Public  Health  continued  COVID-19  related  activities.  The  institute,  the 
Ministry of Health and other health institutions were all active in communicating information 
to  the  citizens  on  prevention  measures  and  relevance  of  immunisation.  Due  to  the 
epidemiological situation in the last quarter of 2021, Montenegro banned entry of citizens to 
malls and hospitality venues without COVID certificates, which contributed to an increased 
vaccination rate. Some of the restrictive measures were lifted in spring 2022 but others were 
maintained such as those related to wearing a mask. By the end of August 2022, almost 46% 
of  the  population  received  two  doses  of  the  COVID-19  vaccination,  and  over  16%  of  the 
population received three doses. Montenegro aligned itself with the requirements of the EU 
COVID-19 digital certificates and started issuing compliant certificates for its citizens on 30 
December  2021.  Montenegro  is  part  of  viral  respiratory  disease  surveillance  networks 

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managed by ECDC and reports to it on several communicable diseases, but it should improve 
the timeliness and completeness of the reported data.   

The  government  adopted  the  programme  for  fighting  HIV/AIDS  for  the  period  2021-2023 
and the action plan for 2021-2022. The prevention measures in the programme are primarily 
related  to  the  promotion  of  protective  behaviour  among  key  population  groups.  The  action 
plan  of  the  programme  for  the  control  and  prevention  of  non-communicable  diseases  in 
Montenegro for 2021 was adopted in July 2021. 

On  health  inequalities,  access  to  healthcare  services  remains  available  for  all  vulnerable 
groups,  with  the  exception  of  persons  without  regulated  legal  status,  including  Roma  and 
Egyptians,  as  well  as  population  living  in  remote  rural  areas.  According  to  available 
information,  the health care of children  with  disabilities is  poor. Due to  the lack of staff in 
health  care  institutions,  they  have  to  wait  for  specialist  examinations  (specifically  for  child 
neuropsychiatrists)  for  several  months.  Children  with  developmental  disorders  cannot  get 
adequate treatment on time. 

CLUSTER 3: COMPETITIVENESS AND INCLUSIVE GROWTH  

This  cluster  covers  chapters  10-digital  transformation  and  media,  16-taxation,  17-economic 
and monetary policy, 19-social policy and employment, 20-industrial policy, 25-science and 
research, 26-education and culture, and 29-customs. All eight chapters are open, with closing 
benchmarks set in all but two, namely chapter 25-science and research and 26-education and 
culture – both of which are provisionally closed. Closing benchmarks remain to be fulfilled in 
each of the other six chapters. This cluster and the reforms concerned have significant links to 
Montenegro’s Economic Reform Programme. 

Some  progress  was  achieved  in  different  areas  e.g.  alignment  with  the  Broadband  Cost 
Reduction  Directive,  tax  legislation  as  well  as  administrative  cooperation  and  mutual 
assistance;  as well  as on further implementation  of  the revised industrial  policy. There was 
slow progress on preparations for accession to the Convention on common transit procedure, 
on  implementing  actions  foreseen  in  the  trade  facilitation  strategy  2018¬-2022  and 
implementation of the action plan for alignment with the EU acquis in the area of economic 
and monetary policies. 

In the coming period, Montenegro is invited to step up legislative alignment in the electronic 
communications,  information  technologies  and  audiovisual  media  sectors  and  ensure  the 
media sector’s independence; make further progress on removing VAT and other exemptions 
that  are  not  aligned  to  the  EU  acquis;  alignment  with  the  EU  monetary  and  economic 
policies,  including  on  cooperation  and  coordination  amongst  relevant  public  authorities; 
monitor the implementation labour law, in addition to focusing on the employment activation 
measures in addition to the further development  of the Youth Guarantee: continuing efforts 
on improving safety at work particularly regarding labour inspection; continue implementing 
the revised industrial policy and strengthen inter-ministerial cooperation; continue to support 
financially  research  and  innovation  especially  regarding  smart  specialisation  and  the  Green 
and Digital Agendas; build on the quality and accessibility of education and training and plan 
for further education reform; and establish an EU-compatible, computerised common transit 
system.   

Chapter 10: Digital transformation and media 

The  EU  supports 
for  electronic 
communications,  electronic  commerce  and  audio-visual  services.  The  rules  protect 
consumers and support universal availability of modern services. 

internal  market 

functioning  of 

the  smooth 

the 

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Montenegro remains moderately prepared in the area of digital transformation and media. 
There  was  limited  progress,  during  the  reporting  period  mainly  through  the  alignment 
with the Broadband Cost Reduction Directive and by the adoption of strategic documents 
on information society. No progress was made on last year’s recommendations, which thus 
remain valid.  

In the coming year, Montenegro should in particular: 

  progress in aligning with the EU acquis on electronic communications and information 
technologies  and  complete  legislative  alignment  on  audio-visual  media,  ensuring  the 
operational independence of the media regulators and the public service broadcaster; 

  progress  in  granting  the  Agency  for  Electronic  Media  (AEM)  powers  to  impose  a 
complete  set  of  measures,  including  warnings,  fines,  suspensions  and  revocation  of 
licenses ensuring proportionality and effectiveness; 

  establish  a  track  record  demonstrating  the  administrative  capacity  to  enforce  the  EU 
acquis  for  electronic  communications,  information  society  services  and  in  particular 
audio-visual media services, including as regards regulatory independence. 

In the reporting period, the government adopted the roadmap for the fulfilment of the closing 
benchmarks for Chapter 10.  

The  Ministry  of  Economic  Development  and  Tourism  is  in  charge  of  electronic 
communications and information technologies. In December 2021, the Parliament adopted 
the  law  on  the  use  of  physical  infrastructure  for  the  installation  of  high-speed  electronic 
communications,  thus  aligning  with  the  EU  broadband  cost  reduction  directive.  Broadband 
infrastructure  development  progressed  with  support  by  the  EU.  According  to  Montenegrin 
statistical information, fixed broadband connection is used by 97% of households and 69% of 
those have data transfer rates of at least 30 Mb/s.  Montenegro has created conditions for 5G 
connections. At the start  of 2022, a  working  group was  formed to  draft the  5G strategy  for 
2023–2027.  The  roadmap  for  the  deployment  of  5G  mobile  networks  was  adopted  in 
December  2021,  while  the  adoption  of  the  national  5G  roll-out  and  allocation  of  the 
commercial  5G  spectrum  are  expected  in  the  course  of  2022.  Radio-frequencies  in  the  900 
MHz,  1800  MHz,  2  GHz  and  2.6  GHz  bands  were  successfully  auctioned.  The  Regional 
Roaming Agreement was fully implemented.  

The 112 European emergency number is functioning with an e-call service successfully tested 
and in use. 

Digital transformation is under the responsibility of the Ministry of Public Administration. 
In December 2021, the government adopted the Digital Transformation Strategy 2022-2026, 
the Strategy for Digitalisation of the Education System 2022-2026, and the Law on Electronic 
Documents.  Montenegro  still  needs  to  complete  its  alignment  with  the  EU  acquis  on 
electronic  communications  and  information  technologies,  such  as  the  European  Electronics 
Communication Code, the Network and Information Security Directive, the Toolbox for 5G 
Cybersecurity,  the  Open  Data  Directive  and  the  e-Privacy  Directive.  The  number  of  e-
government  services  is  410,  from  50  institutions.    During  the  first  quarter  of  2022,  the 
government  offered  e-payment  opportunities  and  electronic  identification  (digital  ID  cards) 
for a selected number of services. Moreover, the government  improved the user experience 
and  the  scope  of  the  open  data  portal  data.gov.me,  which  currently  offers  197  datasets.  A 
new, improved government web portal (gov.me) was developed and introduced.  

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The cyber security strategy 2022-2026, with an action plan, was adopted in December 2021. 
The  government  also  decided  to  strengthen  the  national  capacities  for  cyber  security, 
including the establishment of a cybersecurity agency.  

The  Ministry  of  Culture  and  Media  is  the  legislative  body  on  audio-visual  policy.  The 
regulatory  Agency  for  Electronic  Media  (AEM)  continued  to  exercise  its  mandate  in  a 
professional manner. In January 2022, the AEM suspended the broadcasting of several shows 
of  the  Belgrade-based  Happy  TV  in  Montenegro  for  a  period  of  six  months,  for  inciting 
hatred,  intolerance  and  discrimination  against  ethnic  Montenegrins.  The  overlap  in 
jurisdiction concerning media oversight during elections remained. The Agency still lacks the 
authority and measures to effectively monitor and penalise broadcasters and legal provisions 
and its operational capacity remains to be strengthened.  

The law on audio-visual media services, the amendments to the law on media and the law on 
the national public broadcaster remain to be adopted. Montenegro should ensure alignment to 
the 2018 revision of the EU Directive on the audio-visual media services, recommendations 
and legal opinions of Council of Europe and OSCE. The consistency of the three laws needs 
to be ensured and the legislative process conducted in an inclusive and transparent manner, in 
dialogue  with  all  relevant  stakeholders.  Financial  support  to  media  through  the  newly 
established  Media  Pluralism  and  Diversity  Fund  started.  The  Ministry  of  Public 
Administration, Digital Society, and Media continued working on the comprehensive Media 
Strategy  of  Montenegro  2022-2026,  which  includes  fight  against  disinformation  and 
promotion of media literacy. 

Chapter 16: Taxation  

EU rules on taxation cover value-added tax and excise duties as well as aspects of corporate 
taxation.  They  also  deal  with  cooperation  between  tax  administrations,  including  the 
exchange of information to prevent tax evasion.  

Montenegro  is  moderately  prepared  in  the  area  of  taxation.  Some  progress  was  made 
notably  on  improving  tax  legislation  as  well  as  administrative  cooperation  and  mutual 
assistance.  The  recommendations  related  to  TADAT  (tax  administration  diagnostic 
assessment tool) analysis, value-added tax (VAT) exemptions and building capacities of the 
Revenue and Customs Administration from 2021 remain valid. 

In the coming year, Montenegro should in particular:  

  continue to implement the action plan addressing the issues highlighted by the TADAT 

analysis; 

  further remove VAT and other tax exemptions that are not aligned to the EU acquis; 

  adopt a strategic plan in order to further develop capacities of the Revenue and Customs 

Administration and to prevent the outflow of qualified and trained staff. 

In the area of indirect taxation, in December 2021, the Parliament adopted amendments to 
the Law on value added tax, which stipulate that VAT is calculated and paid at a reduced rate 
of  7%  of  the  transactions  for  services  for  the  preparation  and  serving  of  food,  drinks  and 
beverages, except alcoholic beverages, carbonated beverages with added sugar and coffee in 
facilities  providing  hospitality  services.  In  May  2022,  the  law  was  further  amended, 
introducing gradual reduction of VAT rates on trade and imports of flour and sunflower oil, 
salt and pellets.  At the same time, the Law on excise duties was amended reducing the excise 
duty  for  unleaded  petrol  and  gas  oils  and  increasing  it  for  smokeless  tobacco  products  and 
introducing disposable plastic products in the excise system. Montenegro also further aligned 

94 

 
 
its indirect tax legislation to the EU acquis by requiring leisure boats to pay VAT and excise 
when refuelling.   

In  December  2021,  the  Parliament  adopted  an  important  set  of  laws  on  direct  taxation. 
Amendments  to  the  Law  on  personal  income  tax  introduced  a  dual  system  of  income 
taxation, strengthening tax discipline and providing incentives to attract certain categories of 
taxpayers.  Dual  system  implies  proportional  and  progressive  rates  of  personal  income  tax, 
depending on the source of income. The new legal solutions also prescribe exemption from 
personal income tax on specific cases. In parallel, amendments to the Law on contributions 
for compulsory social insurance abolished health contributions borne by the employer and the 
employee,  to  ensure  a  reduction  in  the  tax  burden  on  labour.  Amendments  to  the  Law  on 
unified  registration  and  reporting  system  on  calculation  and  collection  of  taxes  and 
contributions  brought  legal  technical  harmonisation  with  the  Law  on  contributions  for 
compulsory  social  insurance,  i.e.  deletion  of  the  conceptual  category  related  to  the  health 
insurance. The Law on rescheduling of tax claims provided legal and natural persons facing 
liquidity  problems  with  an  incentive  to  resolve  their  situation  regarding  the  payment  of  tax 
liabilities,  (i.e.  to  reschedule  their  tax  debt).  Finally,  amendments  to  the  Law  on  corporate 
profit tax aligned national legislation with the EU acquis on the common system of taxation 
applicable in the case of parent companies and subsidiaries of different EU Member States as 
well  as  on  the  common  system  of  taxation  applicable  to  interest  and  royalty  payments 
between  associated  companies  of  different  Member  States.  In  April  2022,  the  Law  on  real 
estate tax was amended with regard to market values of real estates.   

Regarding  administrative  cooperation  and  mutual  assistance,  in  December  2021, 
amendments to the Law on tax administration were adopted, aligning it with the relevant EU 
acquis.  This  provides  the  legal  basis  for  mandatory  automatic  exchange  of  tax  information 
between  the  Revenue  and  Customs  Administration  of  Montenegro  and  the  competent 
authorities of the EU Member States. 

A self-assessment of the Revenue and Customs Administration of Montenegro is ongoing to 
test the country’s readiness to start the envisaged automatic exchange of financial account 
information in the OECD framework on base erosion and profit shifting (BEPS), scheduled 
for  September  2023.  Montenegro  has  completed  double  taxation  agreements  with  25  EU 
Member States. 

On  operational  capacity  and  computerisation,  progress  was  registered  in  terms  of 
introduction  of  the  Integrated  Information  System  (IRMS),  as  well  as  the  modernisation  of 
business  processes  in  accordance  with  current  trends  in  the  digitalisation  of  services.  The 
application  of  the  real-time  online  fiscalisation  system  started  on  1  June  2021  for  all 
taxpayers. 

No  progress  was  registered  as  to  the  technical  capacity  and  infrastructure  needed  for  the 
application of the EU IT systems, such as Excise Movement Control System (EMCS) and 
VAT Information Exchange System (VIES). The Revenue and Customs Administration still 
needs to adopt a human resources strategy as well as personnel and training plans. 

Chapter 17: Economic and monetary policy 

EU rules require the independence of central banks and prohibit them from directly financing 
the public sector. Member States coordinate their economic policies and are subject to fiscal, 
economic and financial surveillance.  

Montenegro  is  moderately  prepared  in  the  area  of  economic  and  monetary  policy. 
Limited  progress  was  achieved  on  meeting  last  year’s  recommendations,  mainly  on 
implementation  of  the  action  plan  for  alignment  with  the  EU  acquis.  The  2022-2024 

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Economic Reform Programme (ERP) was adopted on time. The design quality of the ERP 
economic and fiscal policies as well as the reform measures improved. However, the level 
of  implementation  of  some  reforms  remains  weak.  Moreover,  the  chronic  lack  of 
resources  to  handle  government  finance  statistics  at  the  Montenegrin  Statistical  Office 
(Monstat)  continues  to  hamper  progress  in  this  chapter.  Last  year’s  recommendations 
remain valid. 

In the coming year, Montenegro should: 

  continue to implement the revised action plan for alignment with the EU acquis under 

this chapter;  

  ensure adequate capacities of, and cooperation and coordination of tasks between, the 
Ministry of Finance, the Central Bank of Montenegro and Monstat on the production 
of  government  finance  statistics  and  fiscal  notifications  aligned  with  ESA  2010 
methodology. 

Montenegro does not have standard monetary policy tools at its disposal, as it uses the euro 
as  legal  tender,  leaving  fiscal  policy  as  the  main  macroeconomic  policy  instrument. 
Montenegro’s  use  of  the  euro,  which  was  decided  by  the  authorities  under  exceptional 
circumstances, is fully distinct from membership of the euro area. 

In December 2021, the government adopted a roadmap to fulfil conditions for the provisional 
closure  of  negotiations  in  chapter  17.  The  roadmap  also  identifies  horizontal  links  between 
chapter 17 and other chapters (namely chapters 4, 9, 18 and 32) and clusters, in line with the 
revised enlargement methodology. 

The  Action  plan  for  alignment  with  the  EU  acquis  under  this  chapter  was  revised  at  the 
beginning of 2022. The Central Bank of Montenegro continued working on amendments to 
the  Law  on  the  Central  Bank,  with  the  technical  assistance  of  the  International  Monetary 
Fund. Amendments are foreseen to be adopted in the last quarter of 2022.  

On  economic  policy,  there  was  some  further  alignment  with  the  Council  Directive 
2011/85/EU on requirements for budgetary frameworks of the Member States. New elements 
of  programme  budgeting  and  medium-term  planning  were  introduced  with  the  adoption  of 
2021  budget.  However,  performance  indicators  are  still  being  developed.  Delays  in  the 
introduction of accrual accounting and production of government finance statistics based on 
the  European  System  of  Accounts  (ESA  2010)  standards  remain  a  key  obstacle  in  this 
chapter.  There  was  no  progress  with  coverage  of  Montenegro`s  fiscal  notifications. 
Moreover, Montenegro failed to submit the excessive deficit procedures tables in April 2022 
as requested by Eurostat. Coordination between the Ministry of Finance, the Central Bank of 
Montenegro  and  Monstat  needs  to  significantly  improve  for  the  production  of  necessary 
statistics.  

Amendments to the Law on budget and fiscal responsibility that would create conditions for 
the  establishment  of  an  independent  fiscal  council,  to  strengthen  the  oversight  of  the  fiscal 
policy in the country, are expected to be adopted along with the 2023 budget.  

The  government  adopted  and  submitted  its  2022-2024  Economic  Reform  Programme 
(ERP) on 31 January 2022. The economic consequences of Russia’s war against Ukraine and 
surging inflation may render the macro-fiscal scenarios, presented in the document, partially 
obsolete.  However,  medium-term  fiscal  and  structural  reform  challenges  and 
the 
programme’s  priorities  remain  valid.  Overall,  the  quality  and  design  of  economic  policy 
measures  has  improved,  but  efforts  need  to  continue  in  order  to  avoid  delays  with  the 
implementation of the policy guidance jointly agreed with the EU. 

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Chapter 19: Social Policy and employment 

 EU rules in the social field include minimum legal labour standards, equality, health and 
safety at work and non-discrimination and promote social dialogue.  

Montenegro  has  some  level  of  preparation  on  social  policy  and  employment.  Some 
progress  was  made  during  the  reporting  period,  including  the  amendment  to  the  Child 
protection law and the reduction of the tax wedge. 

While  some  steps  have  been  made,  the  recommendations  from  last  year’s  report  remain 
valid. In the coming year, Montenegro should in particular:  

  reform and strengthen the Employment Agency in order to allow it to play its role as a 
modern  public  employment  service,  designing  and  implementing  quality  employment 
activation  measures,  ensuring  these  are  targeted,  including  at  young  people  women, 
persons with disabilities, vulnerable persons and minorities, including Roma. Continue 
preparations focused on the establishment and implementation of the Youth Guarantee; 

  monitor  implementation  of  the  revised  labour  law  and  reinforce  staffing  in  and  the 
institutional  structure  of  the  labour  inspectorate,  also  ensuring  that  issues;  regarding 
women, persons with disabilities, minorities including Roma and vulnerable people, are 
more  robustly  addressed.    Improve  health  and  safety  at  work  issues  by  setting  up  the 
occupational health and safety fund; 

  continue  the  reform  of  the  social  protection  system  based  on  the  Roadmap  of  Social 

Protection Reform.  Adopt and implement the strategy on de-institutionalisation. 

In  December  2021  the  Parliament  adopted  amendments  to  the  labour  law,  as  part  of  the 
comprehensive  reform  package  ‘Europe  Now’,  it  is  noted  that  some  of  these  amendments 
foresaw an increase by 80% of the minimum wage. Amendments to the Law on pensions and 
Disability Insurance, as well as the Law on Protection of Employed Citizens of Montenegro 
Posted  to  Work  Abroad  were  adopted  in  December  2021.  Although  in  July  2021,  the 
Government re-established the Chapter 19 Working Group that includes relevant social and 
civil  society  partners  the  group  is  not  yet  functioning.  Following  the  formation  of  the  new 
Government  in  April  2022,  the  competences  shared  between  the  Ministry  of  Finance  and 
Social  Welfare  and  Ministry  of  Economic  Development  were  reintegrated  back  into  the 
reconstituted  Ministry  of  Labour  and  Social  Welfare.    In  addition,  more  should  be  done  to 
have in place legal protections for women employed under fixed-term employment contracts.    

and 

safety 

health 

at  work, 

Concerning 
the  
Ministry of Economic Development  established a multi-sector Working Group, tasked with 
the  development  of  the  National  Strategy  for  Occupational  Safety  and  Health  (2022-2027) 
and the Action Plan for  implementation  for 2022. The occupational  safety  and health fund, 
foreseen  under  the  previous  sector  strategies  (2010-2014  and  2016-2020),  has  not  however 
yet been established. From January 2021 to December 2021, it was reported that there were 
four  fatal  (the  same  amount  than  the  previous  year)  and  21  serious  accidents  at  work  (four 
more than in 2020). Four collective accidents were reported. 

September 

2021, 

in 

On social dialogue, the impact of the relevant provisions in the labour law are not yet visible. 
The tripartite Social Council is functioning, but steps still need to be taken to ensure it is fully 
embedded  into  national  policy-making.  During  2020  three  sessions  had  taken  place  in  the 
period  prior  to  July.  In  addition,  an  extension  of  the  validity  of  the  general  collective 
bargaining agreement was made until the end of 2022 as the new agreement has still not been 
adopted.  

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On  employment  policy,  in  December  2021  the  Government  adopted  the  National  Strategy 
for  Employment  for  the  period  2021-2025  and  the  2022  Action  Plan  for  Employment. 
Monitoring  of  the  implementation  of  the  National  strategy  for  Employment  will  remain  a 
challenge, as it was with the previous Strategy as a result of the scarcity of data. Overall, the 
effectiveness  and  coverage  of  active  labour  market  policies  remains  insufficient.  The 
Employment Agency requires substantial reform and strengthening, as amongst other things 
it is not yet ready to take on the challenge of delivering the Youth Guarantee and promoting 
up and reskilling actions. Additionally, the discrepancy of the ratio of workers in the Agency 
between branch offices and at central level has not yet been addressed. A partial recovery on 
the labour market in Q3 of 2021 came on the back of the economic rebound. The rate of long-
term unemployed over one year decreased from 65.6% to 63.7% between Q1 and Q4 of 2021. 
Overall  unemployment  was  recorded  at  16.8%  compared  to  18.3%  in  the  previous  year. 
Differences  across  regions  remain,  with  the  unemployment  rate  being  low  at  7.4  %  in  the 
coastal region, 11.3% in the central region and 30.8% in the north according to data from Q4 
2021.  The  most  vulnerable  groups  on  the  labour  market  remain  women,  youth,  Roma, 
persons with disabilities and low skilled workers. The share of young people (15-29) not in 
education,  employment  or  training  (NEET)  had  decreased  by  only  0.1%  (from  26.6%  to 
26.5%)  between  Q4  2020  and  Q4  2021  according  to  an  International  Labour  Organisation 
report.  To  tackle  this  in  December  2021  the  Government  adopted  a  programme  for  youth 
employment in 2022, as a precursor to the Youth Guarantee scheme. Regarding the latter, the 
institutional focal point for the introduction of the YG scheme and the Working Group that 
should manage its setup has been appointed. While reinforced efforts are still required so to 
tackle issues related to the informal economy during the year Montenegro took policy steps 
which  led  to  a  reduction  in  the  tax  wedge  on  labour.  Regarding  labour  inspection,  an 
appropriate  legislative  framework  with  sufficient  resources  and  a  modernised  planning  of 
inspection  activities  with  improved  coordination  among  the  different  inspection  bodies, 
addressing  issues  such  as  gender  which  impact  disproportionately  on  women,  is  not  yet  in 
place. In the reporting period, no progress was noted regarding the efficiency of the linkage 
between the database of the Employment Agency and the Tax Administration. Employment 
and  social  services  are  still  insufficiently  coordinated.  The  digitalisation  process  of  the 
Employment Agency has not been finalised and its coordination with social welfare centres 
remains an issue to be addressed.   

As  regards  the  activities  focused  preparing  for  the  European  Social  Fund  (ESF),  the 
implementation  of  the  Sector  Operational  Programme  for  human  resources  development 
(2015-2017)  moved  towards  its  final  stage,  as  planned.    (See  also  Chapter  22  -  Regional 
policy and coordination of structural instruments). 

The  social  protection  and  inclusion  sector  continues  to  face  serious  human  resource  and 
capacity limitations. While the review of the social protection system was finalised in April 
2021  and  a  Roadmap  of  Reforms  was  published  in  July  2021,  insufficient  steps  have  been 
taken to move reform forward. In December 2021, the Child  Protection Law was amended, 
expanding  child  allowance  to  children  up  to  18  years  old.  In  parallel,  the  Law  on 
Compensation of former beneficiaries of benefits based on the birth of three or more children 
was adopted. In the reporting period, centres for social work continued to be under-staffed. 
Furthermore,  the  performance  of  the  centres  were  affected  by  changes  in  management  and 
expansion of responsibilities. Social welfare centres still do not have the capacities to help the 
Ministry to implement the transition from institutional service provision to community-based 
care.  The  Institute  of  Social  and  Child  Protection  still  requires  strengthening  in  terms  of 
resources.  Social  services  provided  at  local  level  continue  to  be  underfunded.  During  the 
reporting  period,  the  implementation  of  the  integrated  Social  Welfare  Information  System 

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(SWIS) proceeded, and it is reported as being operational in  all centres for social work and 
social  and  child  protection  institutions.  According  to  the  Survey  of  Income  and  Living 
Conditions (SILC - data for December 2021), the national “at-risk-of-poverty” (AROP) rate 
was 22.6 %, whereas for children it stood at 32.6 %. Negatively the country does not have a 
focused poverty strategy. On de-institutionalisation of children in care, no progress has been 
registered in the transition to community and family-based services: professional foster care 
has  not  been  introduced  and  the  adoption  of  the  Strategy  on  de-institutionalisation  is  still 
pending (expected Q4, 2022).  The Council for the Care of Persons with Disabilities does not 
yet have its members appointed.  

On  non-discrimination  in  employment  and  social  policy,  the  draft  Law  on  Professional 
Rehabilitation  and  Employment  of  Persons  with  Disabilities  and  the  draft  Law  on  Unified 
Disability  Determination  system  are  being  revised  but  is  still  pending  adoption.  As  regards 
services provided by civil society organisations, the number of service provision licences for 
NGOs  did  increase  thanks  to  some  review  of  administrative  constraints.  However, 
consultation  with  civil  society  in  the  context  of  the  drafting  of  the  new  Social  Protection 
Strategy has still been insufficient. So far, no concrete results of the Roma inclusion strategy 
for  2021-2025  in  line  with  the  EU  Roma  strategic  framework  are  visible.  Progress  on  the 
lesbian,  gay,  bisexual,  transgender,  intersex  and  queer  (LGBTIQ)  strategy  (2019-2023)  is 
unclear.  More  generally,  civil  society  organisations  still  need  to  be  better  integrated  in  the 
decision-making processes.  

On  equality  between  women  and  men  in  employment  and  social  policy,  according  to 
MONSTAT Labour Force Survey, in the course of 2021,  the gender gap between male and 
female  employment  rates  (population  aged  20-64)  persisted  with  a  difference  of  8.6  % 
percentage points in Q4 2021, as compared to 13.6 % in Q4 2020. Moreover, the gender gap 
in employment and pay, workplace sexual harassment, affordable childcare, unpaid work and 
tax  benefit  systems  are  all  issues  having  negative  impact  on  equality  between  women  and 
men, and they still require action. Due to  lack of data, it is not possible to state how many 
cases  of  sexual  harassment  have  come  to  trial.  In  parallel,  more  can  be  done  in  terms  of 
raising  public  awareness  on  this  issue,  including  via  the  Ombudsperson  office  and  through 
actively  supporting  women’s  NGOs.  No  progress  has  been  made  regarding  legislative  and 
non-legislative measures focused on work-life balance. 

Chapter 20: Enterprise and industrial policy  

EU industrial policy enhances competitiveness, facilitates structural change and encourages 
an enterprise-friendly environment that stimulates small and medium sized enterprises. 

Montenegro is  moderately prepared/has a good level of preparation on enterprise and 
industrial policy. Some progress was made in implementing the enterprise and industrial 
policy,  as  per  2021  recommendation.  Inter  and  intra-ministerial  cooperation  on  both 
technical and political levels should be further developed to ensure consistency of different 
national  strategies  and  programmes,  including  industrial  policy,  smart  specialisation  and 
the Economic Reform Programme. Previous recommendations remain broadly valid. 

In the coming year, Montenegro should: 

  continue  the  implementation  of  its  revised  industrial  policy,  in  cooperation  with 

relevant stakeholders; 

  accelerate  legal  alignment  with  the  EU  Late  Payment  Directive  by  adopting 

amendments to the law on deadlines for settlement of monetary obligations; 

99 

 
 
  ensure continuous coordination of industrial policy with other key national strategies. 

On  enterprise  and  industrial  policy  principles,  a  new  strategy  for  the  development  of 
women's  entrepreneurship  2021-2024  was  adopted  in  October  2021,  together  with  the 
accompanying  action  plan  for  2021-2022.  Work  advanced  on  establishing  the  Credit 
Guarantee  Fund  in  2022,  a  support  mechanism  facilitating  access  to  credit  for  MSMEs 
through  the  banking  sector.  The  reforms  of  the  corporate  governance  in  the  state-owned 
enterprises  need  to  be  prioritised,  in  line  with  the  Economic  Reform  Programme 
commitments.  Alignment  with  the  EU  acquis  on  combating  late  payments,  through 
amendments to the law on deadlines for settlement of monetary obligations, is still pending. 

On  enterprise  and  industrial  policy  instruments,  the  implementation  of  different 
programmes for the development of entrepreneurship and private sector continued under the 
overarching  Programme  for  Improving  the  Competitiveness  of  the  Economy.  The  financial 
allocations were reduced in 2021 because of the phase-out of temporary COVID-19 support 
and amounted to EUR 3 million overall. Businesses were consulted prior to the adoption of 
the Programme, for the first time, and the whole application process was digitalised. A single 
on-line portal  for SME support  (Single Access  Point;  www.biznis.gov.me) was launched  in 
June 2022, which will  provide all necessary information and  contacts regarding advice  and 
assistance  for  businesses.  As  of  May  2022,  410  public  services  were  available  on  the  e-
government Portal, of which 99 were interactive and 311 informational.  

In  2021,  the  Investment  and  Development  Fund  of  Montenegro  (IDF)  provided  financing 
worth EUR 210.3 million to Montenegrin enterprises, and additional EUR 74.7 million by the 
end  of  May  2022.  IDF  launched  a  new  programme  to  support  the  development  of  green 
businesses in August 2021. In November 2021, IDF signed a EUR 50 million loan agreement 
with  the  EIB  to  support  faster  recovery  of  the  local  economy  from  COVID-19  and  help 
introduce energy-efficient practices among small businesses in the country. 

Montenegro  expressed  its  interest  to  participate  in  the  Single  Market  Programme  (SMP). 
Formal  negotiations  for  an  Association  Agreement  started  in  March  2022  and  are 
progressing.  

On sectoral policies, an action plan for the implementation of industrial policy for 2021-2022 
was  adopted  in  October  2021,  allocating  EUR  450.8  million  for  the  planned  activities. 
Government’s  work  programme  for  2022  is  focused  on  the  synergies  between  Industrial 
Policy  and  the  Smart  Specialisation  Strategy.  In  December  2021  the  government  adopted 
guidelines  for the revitalization and development of manufacturing industry. The document 
defines  measures  and  activities  that  should  contribute  to  the  establishment  of  a  modern 
industrial base in Montenegro. The 2021 report on the Implementation of Industrial Policy of 
Montenegro 2019-2023 is yet to be adopted.  

As regards innovation policy (see also chapter 25, Science and Research), two new structures 
were  established  in  2021  -  the  Council  for  Innovation  and  Smart  Specialization  and  the 
Innovation Fund of Montenegro.  

Despite some progress on inter and intra-ministerial cooperation, in particular when preparing 
the  Economic  Reform  Programme  2022-2024,  cooperation  on  technical  and  political  levels 
should  be  further  reinforced.  The  number  of  sectoral  strategies,  actions  plans  and  reports 
should  be  further  decreased  and  activities  consolidated,  in  order  to  facilitate  the  efficient 
management of enterprise and industrial policy. 

Chapter 25: Science and Research  

100 

 
 
The  EU  provides  significant  support  to  research  and  innovation.  All  Member  States  can 
benefit  from  the  EU’s  research  programmes,  especially  where  there  is  scientific  excellence 
and solid investment in research.  

Montenegro  has  a  good  level  of  preparation  in  this  sector.  Good  progress  was  made  on 
each  of  the  2021  recommendations  through  continued  implementation  of  the  Smart 
Specialisation Strategy and by starting participation in the Horizon Europe programme. 

In the coming year, Montenegro should in particular: 

  further advance implementation  of the Smart  Specialisation Strategy while taking steps 

to make the Innovation Fund fully operational; 

  strengthen  structures  of  academia-business  cooperation  and  further  support  the 

knowledge transfer between them; 

  increase  investments  in  research  and  innovation  programmes  and  participation  in  the 

Horizon Europe programme, ensuring that this also targets women. 

On  research  and  innovation  (R&I)  policy,  the  implementation  of  related  strategies 
continued,  and  support  for  innovative  projects  were  provided  through  a  number  of 
programmes, including pre-acceleration for start-ups. Montenegro adopted five pieces of by-
laws  in  order  to  fully  implement  the  legal  framework  for  innovation.  A  memorandum  on 
cooperation  within  the  National  Open  Science  Cloud  Initiative  was  signed  by  nine 
Montenegrin  higher  education  and  research  institutions  in  January  2022.  Montenegro  has 
initiated the creation of a feasibility study of a national open science repository, which will 
provide necessary elements to form the open science repository and join the European Open 
Science Cloud.  

The  latest  available  statistics  from  2019  indicated  that  research  and  development  (R&D) 
funding stood at 0.36 % of GDP in 2019 (0.50% in 2018), with an investment share of 0.12 % 
provided by the private sector. An increased budget in this area remains very much needed to 
support  the  country’s  economic  recovery,  while  helping  address  the  issue  of  brain  drain  of 
researchers and young people.  

The  new  Strategy  for  Scientific  Research  Activities  (2022-2026),  which  will  define 
instruments aimed at increasing the number of researchers, is not  yet in place. The working 
group tasked with its development was established on 25 January 2022. One of the priorities 
of  the  future  strategy  will  be  making  stronger  connection  between  science  and  economy, 
further  linking  scientific  research  and  innovation  activities.  Cooperation  between  the 
academic  and  business  sectors  is  promoted  through  the  implementation  of  programmes 
between the Minister of Science and Technological Development, the Ministry of Education, 
Culture and Sports and the Ministry of Economic Development in the field of innovation. A 
total  of  13  projects  supported  through  the  EU-funded  Collaborative  grant  scheme  for 
innovative project ideas are on-going and should be completed by Q4 2022. 

Montenegro continues to implement the Smart Specialisation Strategy (S3), in line with its 
national  legislation  and  the  Commission’s  technical  recommendations,  through  adoption  of 
the  Operational  Programme  for  the  Implementation  of  the  Smart  Specialization  Strategy 
2021-2024.  This  covers  the  four  S3  strategic  priority  areas:  agriculture,  energy,  health  and 
tourism.  The  Council  for  Innovation  and  Smart  Specialisation,  as  the  government 
management body for implementing and monitoring the S3 process, was established in June 
2021  and  held  its  first  session  in  December  2021.  The  inter-institutional  S3  working  group 
has  been  established  under  the  lead  of  the  national  S3  coordinator.  Following  the 
organizational changes in the government of Montenegro, harmonization of the structure of 

101 

 
 
the  Council  for  Innovation  and  Smart  Specialization  has  been  initiated  in  June  2022.  It  is 
established  with  an  aim  to  coordinate  and  make  use  of  the  feedback  of  all  relevant  target 
groups  in  creating,  implementing  and  monitoring  the  process  of  smart  specialization.  The 
changes in the institutional S3 Group are also ongoing. 

Further to its establishment in June 2021, the national Innovation Fund became operational at 
the  beginning  of  2022,  with  7  employees  and  following  the  adoption  of  its  2022  work 
programme.  It  will  support  the  implementation  of  innovation  policy  by  funding  innovation 
activities and technological development. First calls for support schemes (vouchers) financed 
from national budget were launched in early 2022, with a total budget of EUR 100.000. The 
development of an information and communication technology (ICT) cluster has not yet been 
innovation  and 
finalised.  The  fully  equipped  and  operational 
entrepreneurship  centre  ‘Tehnopolis’  are  providing  support  to  businesses,  based  on 
innovative ideas and technologies. Following delays, the construction works on the Science 
and Technology Park (STP) in Podgorica are now progressing. Both the STP and Tehnopolis 
are directly involved in implementing certain measures and instruments defined by the S3. In 
March  2022,  the  Ministry  of  Economic  Development  and  the  University  of  Montenegro 
decided  to  establish  a  National  Technology  Transfer  Office  (TTO)  within  the  STP  in 
Podgorica.  Montenegro’s  status  in  the  European  Innovation  Scoreboard  (EIS)  in  2021  was 
one of emerging innovator.  

laboratories  at 

the 

The international agreement on Montenegro’s participation in Horizon Europe was signed in 
December  2021.  A  number  of  institutions  have  already  negotiated  and  signed  grant 
agreements.  The  participation  of  the  scientific  research  community  in  the  Cooperation  in 
Science  and  Technology  (COST)  programme  increased  in  2021,  and  Montenegrin  research 
teams participated in about 110 (still ongoing) actions during the previous year. In May 2022, 
COST Committee of senior officials confirmed the funding of 70 new COST actions that will 
officially start in the autumn of 2022. Research teams from Montenegro also participated as 
partners  in  12  approved  COST  actions.  The  implementation  of  nine  EUREKA  projects 
continued in 2021.  

In  November  2021,  the  country  and  the  International  Atomic  Nuclear  Agency  adopted  the 
Programme of technical cooperation 2022-2023. 

The  implementation  of  the  project  establishing  the  Southeast  Europe  International  Institute 
for Sustainable technologies (SEEIIST) for hadronic cancer therapy and research in the field 
of biomedicine using protons and heavier ions has continued. 

Podgorica was selected to participate in the EU Climate and Smart Cities mission by 2030, 
along with 100 cities from 27 EU Member States and as one of the 12 cities from countries 
associated to the Horizon Europe programme. 

Chapter 26: Education and culture  

The  EU  supports  cooperation  in  education  and  culture  through  funding  programmes  and 
the coordination of Member State policy through the open method of coordination. The EU 
and the Member States must also prevent discrimination and ensure quality education for 
children of migrant workers, including those from disadvantaged backgrounds.  

Montenegro has a good level of preparation in this area. Some progress was made 
regarding the recommendation on inclusive education but for other recommendations much 
more effort is needed and thus, they remain valid. 

In the coming year, Montenegro should in particular: 

  adopt a costed plan for wide ranging education reforms including inclusive education 

102 

 
 
and improving access to quality education at all education levels; 

  implement  the new strategy on  early and pre-school  education 2021-2025 to  improve 

pre-school enrolment for all children; 

  finalise 

then 

initiate 

the  national  Vocational  Education  and  Training  (VET) 
implementation plan 2022-2023 of the VET Strategy 2020-2024, as well as putting in 
place  the  evaluation  mechanism  of  practical  learning  at  VET  and  higher  education 
levels. 

On  education  and  training,  the  government  adopted  the  strategy  on  early  and  pre-school 
education 2021-2025 with a related action plan 2021-2025, and the strategy for digitalization 
of  the  education  system  in  Montenegro  2022-2027,  with  the  action  plan  2022-2023  in 
October and December 2021 respectively.  

According  to  the  Economic  Reform  Programme  of  Montenegro,  2022-2024,  spending  on 
education was 4.3% of GDP in 2021. The preschool enrolment rate stood at 48.71% (male: 
49.09%  and  female:  48.30%)  in  2020-2021,  still  well  below  the  EU  95%  target.  This 
enrolment  of  students  was  however  affected  by  the  COVID-19  context.  The  number  of 
children in preschool education returned to the 2019 level (72% of children aged 3-6), and the 
number  of  children  with  disabilities  in  both  preschool  and  primary  education  increased  by 
21%  and  7%,  Online  schooling  continued  during  the  school  year,  and  regular  schooling 
restarted  as  of  1  September  2021  (with  30-minute  classes)  continuing  the  supporting 
measures on digital exclusion taken in the previous year, and taking into account that many 
children lacked internet access, Telekom of Montenegro provided internet coverage for 100 
branch  units  of  primary  schools  (or  50%  of  total  number  of  branch  institutions)  located  in 
rural  areas.  This  is  the  first  phase  of  a  broader  initiative  planned  by  the  strategy  for 
digitalization of education system, i.e. to make internet available in all schools in Montenegro 
and  providing  all  children  attending  school  with  a  possibility  to  use  digital  content. 
Furthermore, the government approved in December 2021 the Strategy for Digitalization of 
Education (2022 – 2027), which is fully aligned with the EU Digital Education Action Plan. 

Although an analysis of the education systems has been completed, Montenegro still does not 
have  a  qualitative,  budgeted,  multi-annual  education  strategy  and  plan  for  sustainable 
reforms. This would require broad discussions with all relevant stakeholders, including civil 
society  taking  in  issues  of  youth  with  disabilities,  minority  groups,  as  well  as  a  gender 
dimension focusing on the specific needs of girls and boys.   

The  provision  of  additional  free  textbooks  in  primary  schools,  additional  mentors  and 
associates  engaged  at  primary  and  secondary  schools  for  Roma  and  Egyptian  pupils 
continued.  As  in  2020,  free  transport  was  provided  for  600  primary  school  students  (again 
Roma  and  Egyptian)  in  Nikšić,  Podgorica,  Cetinje  and  Berane  municipalities.  Scholarships 
were provided for 172 Roma and Egyptian students at secondary and 12 at university-level. 
Montenegro has still to more closely align with the Poznan Declaration on Roma integration 
in order to  fully implement  the strategy for inclusive education 2019-2025. This  strategy is 
being implemented through a range of actions, such as counselling for schools with integrated 
classes promotional activities for local communities, and trainings to  schools’ management, 
teachers and professional staff. Teaching aids and IT equipment were ensured through an EU-
funded  project.  However,  results  on  an  EU-funded  project  aimed  at  improving  access  for 
persons with disabilities in eight schools were not yet finalised. 

The  new  strategy  on  early  and  preschool  education  was  adopted  in  Q4  2021  and  its 
implementation  started  including  support  to  all  pre-school  institutions  for  conducting 
campaign on enrolment, capacity building of staff to implement the parenting programme, a 

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workshop  on  partnerships  with  Roma  and  Egyptian  families.  Regarding  the  Strategy  on 
lifelong  entrepreneurial  learning  (2020-2024)  the  report  on  the  implementation  of  its  2021 
action plan is ready, as well as the action plan for 2022-2023 and their adoption is expected in 
the next government session. Montenegro has developed key competences, specifically those 
linked to STEM subjects (science, technology, engineering and mathematics) within an EU-
funded project dedicated to the integration of key competences at all levels of the education 
system. 

In  the  area  of  skills  and  vocational  education  and  training  (VET),  and  in  line  with  the 
related  action  plan  2020-2021,  27  occupational  standards,  27  professional  qualification 
standards  and  ten  standards  of  qualification  levels  of  education  were  developed  with  EU 
funds.    A  report  on  the  implementation  of  the  Action  Plan  2020-2021  of  the  VET  strategy 
2020-2024  is,  however,  not  yet  available  nor  is  the  action  plan  2022-2023.  Montenegro  is 
committed  to  implement  and  monitor  the  2015  Riga  Conclusions  on  VET  and  participates 
regularly in the policy dialogue on VET reforms at EU and regional level. Montenegro has 
been  following  initiatives  by  Regional  Cooperation  Council  (RCC)  and  Education  Reform 
Initiative  (ERI  SEE).  Regarding  the  Osnabrück  Declaration  2021-2025  and  commitments 
stemming  from  the  declaration  signature  (commitments  to  the  European  Education  and 
Training Area and the international dimension of VET), Montenegro has finalised the related 
National  Implementation  Plan.  Montenegro  organised  dual  education  (the  school  year 
2021/2022)  in  25  schools  in  17  municipalities  for  around  600  students  (17  educational 
programmes)  with  the  involvement  of  230  employers.  According  to  the  Ministry  of 
Education, the report on dual education for 2020/2021 has been prepared,  however it is not 
yet available. In cooperation with the European Training Foundation, the document on career 
development  was  drafted  in  2021,  and  the  Programme  for  lifelong  career  guidance  and 
counselling  2021-2023  with  the  related  action  plan  was  developed  in  Q4  2021.  In  January 
2022,  the  annual  plan  for  adult  education  for  2022  was  adopted  as  part  of  the  wider  Adult 
Education Plan 2019-2022. 

The Ministry of Education, Science, Culture and Sports revised strategy for higher education 
to  cover  the  period  2022-2026  and  draft  a  new  Law  on  Higher  Education.  However,  their 
adoption  is  pending  and  tangible  results  are  not  yet  in  place.  Developing  a  structured 
monitoring and evaluation of practical education in higher education programmes remains to 
be an area that requires specific attention.  

Montenegro  benefits  from  the  international  dimension  of  the  Erasmus+  programme.  The 
ring-fenced  support  for  the  four  Western  Balkan  countries  not  yet  associated  to  the 
programme  provided  by  IPA  amounts  to  EUR  374  million  for  the  2021-2027  programme 
period.  In  2021,  Montenegro  applied  for  two  calls  under  the  EU’s  programme  Erasmus+. 
While there is not information on the implementation of the Progress in International Reading 
Literacy  Study  (PISA)  and  the  2021  action  plan  and  recommendations  for  improving 
education quality, Montenegro is still active in these processes.  

On  culture,  in  December  2021  Montenegro  signed  an  agreement  with  the  European 
Commission  for  its  participation  in  the  EU  Creative  Europe  2021-2027  programme. 
Montenegro  still  needs  to  establish  an  overall  management  system  to  implement  protection 
measures  for  the  preservation  of  Kotor's  (Boka  Kotorska  Bay)  UNESCO  World  Heritage 
status. 

The newly formed Ministry of Youth and Sports is responsible for the new Strategy on Youth 
and while the previous strategy ended in 2020 as yet a new one has not yet been approved. As 
part  of  the  Youth  Law,  11  Administrators  were  appointed  for  youth  centres  but  most  lack 
institutional support and a budget for activities.  Youth centres need to establish new Action 

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Plans but are dependent of the approval of the new Strategy on Youth. The National Youth 
Council, established in 2020, has representatives from the Montenegrin Youth Network and 
the  Network,  with  46  members’  organizations,  is  actively  participating  in  the  EU  Youth 
dialogue  on  unemployment,  organized  by  the  Regional  Cooperation  Council  (RCC)  and 
Europe  House.  The  outcomes  of  the  Youth  dialogue  should  also  be  incorporated  into  the 
Youth Guarantee which is under development. 

Chapter 29: Customs union  

All Member States are part of the EU customs union and follow the same customs rules and 
procedures.  This  requires  legislative  alignment,  adequate  implementing  and  enforcement 
capacity, and access to the common computerised customs systems.  

Montenegro  is  moderately  prepared  for  the  customs  union.  It  made  limited  progress, 
slowly  advancing  preparations  for  accession  to  the  Convention  on  common  transit 
procedure,  and  implementing  actions  foreseen  in  the  trade  facilitation  strategy  2018¬-
2022,  in  limited  fulfilment  of  last  year's  recommendations.  The  reorganisation  of  the 
customs  administration  in  April  2021  resulted  in  numerous  changes  on  the  managerial 
positions and brought staff recruitment to a standstill. In consequence, the reforms slowed 
down and many IT projects, co-financed by the EU, were delayed. Significant challenges 
remain  in  reducing  illicit  tobacco  trade  through  the  port  of  Bar.  Last  year’s 
recommendations remain therefore valid. 

In the coming year, Montenegro should in particular: 

  establish  an  EU-compatible  computerised  transit  system  (NCTS)  and  finalise 

accession to the Convention on a common transit procedure; 

  continue 

facilitation  measures 
trade 
inefficiencies and the time needed for customs clearance;  

implementing 

to 

reduce  administrative 

  ensure sufficient staffing levels for timely and efficient implementation of  numerous 

IT development projects. 

On customs legislation, the new Customs Code, aligned with the Union Customs Code, was 
adopted  in  July  2022,  though  its  implementation  will  start  in  February  2023.  In  December 
2021,  the  government  adopted  an  action  plan  to  address  last  year’s  recommendations.  The 
document indicates that the implementation of the Customs Code and the ratification of the 
Law  on  accession  to  the  Convention  on  common  transit  procedure  and  the  Convention  on 
trade facilitation in goods should be finalised in the third quarter of 2022. The legislation on 
the control of production and trade of drug precursors is expected to be adopted at the same 
time.  

Montenegro  is  implementing  the  Regional  Convention  on  Pan-Euro-Mediterranean  (PEM) 
preferential  rules  of  origin.  The  ratification  procedure  to  adopt  PEM  transitional  rules  of 
origin  is  ongoing.  In  the  framework  of  the  Authorised  Economic  Operators  (AEO) 
programme, one more authorisation was issued, bringing the number of AEOs in the country 
to three. In December 2021, the government adopted implementing legislation on the customs 
tariff for 2022.  

Further alignment of legislation on customs security, together with adoption of implementing 
legislation  on  the  export  control  of  cultural  goods,  remain  pending.  Fees  continue  to  be 
charged to lorries in inland customs terminals located in privately owned facilities, which is 
not in line with the EU acquis.  

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On  administrative  and  operational  capacity,  the  establishment  of  the  Revenue  and 
Customs  Administration  (RCA)  in  April  2021  was  accompanied  by  numerous  changes  in 
managerial  positions  and  a  new  systematisation  of  jobs.  Very  few  recruitments  took  place. 
Due  to  reorganisation,  staff  shortages  and  the  COVID-19  pandemic,  work  on  the 
implementation  of  the  New  Computerised  Transit  System  (NCTS)  and  accession  to  the 
common transit convention, as well as on other EU-related and co-financed projects, slowed 
down. Consequently, plans had to be adjusted and the deadlines for projects extended.  

The  accreditation  process  for  the  customs  laboratory  is  still  pending.  Draft  instruction  for 
writing-off  customs  debt  were  prepared,  but  would  need  to  be  revised  again,  following  the 
adoption of the new Customs Code. Work in  the areas of the  customs decision system  and 
Integrated  Tariff  Management  System  started  in  December  2021  and  February  2022, 
respectively, with EU support.  

In  2021,  the  gross  collection  of  customs  revenues  amounted  to  approximately  EUR  803 
million,  which  is  19.7%  more  than  in  2020.  The  trend  continued  in  2022,  with  customs 
revenues  reaching  EUR  466  million  by  the  end  of  June  2022,  39%  above  the  amounts 
collected in the same period of 2021.    

As  concerns  the  fight  against  illicit  tobacco  trade,  in  July  2021  the  government  adopted  a 
decision  on  banning  the  storage  of  tobacco  products  in  the  free  zone  of  the  port  of  Bar. 
However, contracts with free zone users storing cigarettes were to expire only in June 2022. 
In  December 2021,  a new government  decision  finally prohibited the placement of tobacco 
products  in  the  free  zone,  except  for  transhipment.  The  RCA  was  tasked  to  perform  the 
inventory of the tobacco stock and set deadlines to ship them out of the free zone. In parallel, 
the RCA was requested to introduce and keep electronic records for all movements of goods 
in the free zone. Before the system became operational in February 2022, a series of cigarette 
thefts  revealed  important  gaps  in  the  free  zone’s  security,  criminal  activity  and  alleged 
collusion of certain customs officers. In May and June 2022, the RCA and police seized large 
quantities  of  cigarettes  without  excise  stamps.  They  should  be  gradually  destroyed,  in 
accordance with Montenegro’s obligations under WHO Framework Convention on Tobacco 
Control and the Protocol to Eliminate Illicit Trade in Tobacco Products. 

The  decision  on  the  storage  prohibition,  implementation  of  the  Cargo  Targeting  System, 
enabling pre-arrival  risk  analysis of  containers in the Port of  Bar, and the use of electronic 
record keeping of containers should contribute to the reduction of illicit tobacco trade through 
the port of Bar. However, gaps in the system remain and need to be addressed and work on a 
track and trace system for cigarettes should continue. 

CLUSTER 4: THE GREEN AGENDA AND SUSTAINABLE CONNECTIVITY  

This cluster covers chapters 14-transport policy, 15-energy, 21-trans-European networks and 
27-environment and climate change. All four chapters are open, with closing benchmarks that 
remain to be fulfilled in each chapter. This cluster and the reforms concerned have significant 
links  to  Montenegro’s  Economic  Reform  Programme,  the  Commission’s  Economic  and 
Investment Plan and the Green Agenda for the Western Balkans endorsed by Montenegro. 

Some  progress  was  achieved  on  creating  a  functioning  day-ahead  energy  market  and  on 
preparing  for  the  membership  in  the  Paris  Memorandum  of  Understanding  on  port  state 
control.  There  was  limited  progress  on  implementing  the  Transport  Development  Strategy 
and on its review; on water management and by improved climate change reporting. 

In the coming period, Montenegro is  invited to  focus on the following areas:  complete key 
recommended reforms in the transport area, in particular on rail transport and on the review 
of Transport Development Strategy; adopt and implement the law on security of supply of oil 

106 

 
 
to  prepare 

products and set –up the functioning day-ahead energy market; strengthen the administrative 
capacities 
transport, 
trans-European  networks 
telecommunications  and  energy;  considerably  step  up  ambitions  towards  a  green  transition 
and  step  up  its  efforts  on  implementation  and  enforcement,  in  particular  on  waste 
management, water quality, nature protection and climate change. 

the  areas  of 

for 

in 

Chapter 14: Transport policy  

The  EU  has  common  rules  for  technical  and  safety  standards,  security,  social  standards, 
state aid and market liberalisation in road transport, railways, inland waterways, combined 
transport, aviation and maritime transport. 

Montenegro  is  moderately  prepared/has  a  good  level  of  preparation  in  the  area  of 
transport policy. There was some progress in the reporting period on key reforms, mainly 
on the strategic framework for implementation of intelligent transport systems (ITS) in the 
field of road transport and accession to the Paris Memorandum of Understanding on port 
state control. Other recommendations from the last year’s report remain valid.  

In the coming year, Montenegro should in particular: 

  achieve  full  membership  in  the  Paris  Memorandum  of  Understanding  on  port  state 

control; 

  adopt a new railway law and ensure the functional, decision-making and  operational 
independence and appropriate staffing of the railway regulatory body and the railway 
safety authority;  

  start implementing intelligent transport systems (ITS) on its core road network and lay 

down the strategic ITS framework for the rail and maritime networks. 

On  general  transport,  in  December  2021  the  government  adopted  a  roadmap  to  fulfil 
conditions  for  the  provisional  closure  of  negotiations  in  chapter  14.  Implementation  of  the 
country’s  transport  development  strategy  continued,  albeit  with  late  adoption  of  the  action 
plan  for  2021-2022  in  December  2021.  Alignment  of  the  national  strategy  with  the 
Sustainable  and  Smart  Mobility  Strategy  for  the  Western  Balkans  of  the  Transport 
Community  needs  to  be  prioritised.  The  Commission  for  Investigation  of  Accidents  in 
Maritime, Rail and Air Transport increased its administrative capacity, however its adequate 
financing  is  yet  to  be  secured.  There  was  no  progress  on  alignment  with  the  EU  acquis 
concerning public service obligations, procedures and criteria for the award of public service 
contracts in road, rail and maritime transport. 

On  road  transport,  in  December  2021,  the  government  adopted  a  four-year  programme 
(2022-2026) for development and deployment of ITS in the field of road transport. Capacities 
and resources for the implementation of the programme need to be allocated. Implementing 
legislation  in  the  area  of  minimum  safety  requirements  for  tunnels,  road  safety  audits  and 
interoperability of electronic road toll systems provided some further alignment with the EU 
acquis. There was no progress on alignment for other pending legal acts.  

The  2020-2022  programme  for  road  safety 
in  its  final  year  of 
implementation.  However,  statistics  show  no  improvement  on  fatal  and  serious  road  traffic 
accidents.  Montenegro  should  urgently  develop  a  long-term  road  safety  strategy  and  action 
plans,  in  line  with  the  EU  road  safety  policy  framework  2021-2030.  It  should  also  step  up 
efforts to develop a database for road safety crashes and improve the data quality. A mid-term 
2022-2026 road maintenance and rehabilitation programme is yet to be prepared.  

improvement 

is 

107 

 
 
On rail transport, there was no progress on alignment with the EU acquis, including on the 
adoption  of  the  new  railway  law,  the  methodology  for  track  access  charges,  full  market 
opening  for  passenger  and  freight  transport  services.  The  management  of  public  service 
contracts  for  rail  transport  and  compliance  with  passengers’  rights  remain  a  concern.  In 
November 2021, the  government  endorsed a new national  programme for the rehabilitation 
and  maintenance  of  the  railway  infrastructure  for  2021-2023.  However,  sustainable  and 
rationalised railway infrastructure rehabilitation and multi-annual maintenance plans need to 
be  urgently  developed.  Montenegro  should  strive  to  address  the  key  challenges  through 
effective implementation of the Transport Community rail action plan.  

On maritime transport, several implementing acts were adopted on the inspection of foreign 
ships.  In  January  2022,  Montenegro  started  implementing  the  National  Maritime  Single 
Window  and  initiated  an  upgrade  and  extension  of  the  vessel  traffic  monitoring  and 
information  system.  Montenegro  is  yet  to  align  with  the  EU  acquis  on  ports  and  to  adopt 
legislation based on Port Services Regulation. Montenegro’s fulfilment of the conditions for 
full  membership  to  the  Paris  Memorandum  of  Understanding  on  Port  State  Control  is 
ongoing. 

On the inland waterway transport in Montenegro, no progress was made on the alignment 
with relevant EU acquis.  

On aviation, several implementing acts on air safety and air traffic operations were adopted. 
Following the establishment of a new national airline company “To Montenegro” in January 
2021,  the  government  gradually  increased  its  founding  capital.  In  December  2021,  the 
parliament  adopted  the  law  on  termination  of  the  law  on  investments  in  consolidation  and 
development  of  the  former  national  airline,  “Montenegro  Airlines”.  The  certification  of 
airports  in  Podgorica  and  Tivat  is  still  not  completed.  In  November  2021,  the  government 
adopted a new programme for air transport facilitation. 

Concerning  combined  transport,  a  comprehensive  feasibility  study  and  business  plan  is 
under  preparation  for  the  establishment  of  the  port  of  Bar  as  a  sustainable  multimodal 
platform.  It  will  provide  the  necessary  baseline  for  functional  requirements,  technical 
specifications and a conceptual design of the selected option for logistic areas and sites. The 
legislation on combined freight transport from 2014 remains the main legal framework in this 
sector. 

Chapter 15: Energy  

EU energy policy covers energy supply, infrastructure, the internal energy market, 
consumers, renewable energy, energy efficiency, nuclear energy and nuclear safety and 
radiation protection. 

Montenegro  has  reached  a  good  level  of  preparation  in  this  area.  Some  progress  was 
made in the reporting period, mainly on preparatory steps towards the creation of a day-
ahead  energy  market  and  on  moving  to  market-based  schemes  for  renewable  energy 
production. Last year’s recommendations were thus partially addressed.  

In the coming year, Montenegro should, in particular:  

  start  operating  a  functioning  day-ahead  electricity  market  and  couple  with 

neighbouring markets, including Italy;  

  accelerate  the  move  to  market-based  support  schemes  for  renewable  energy 

production based on streamlined permitting and connection procedures;  

  adopt the law on security of supply of oil products and set up the stockholding body 

108 

 
 
for the mandatory oil reserves. 

In  the  area  of  security  of  supply,  Montenegro  has  an  energy  development  strategy  up  to 
2030.  The  government  adopted  the  energy  balance  for  2022.  Activities  continued  in  the 
context of the development of the National Energy and Climate Plan. No progress was made 
on  the  revision  of  the  action  plan  on  compulsory  strategic  reserves  of  oil  and  petroleum 
products,  the  adoption  of  the  law  on  security  of  supply  of  oil  products  and  the  setup  of  a 
central body for strategic oil reserves. Oil stocks still remain very low. However, Montenegro 
plans  to  ensure  the  existence  of  strategic  oil  stock  reserves  by  1  January  2023  thanks  to 
introduction  of  stock  keeping  obligations  on  importers  of  petroleum  products.  Montenegro 
does not import oil from Russia and does not have any gas infrastructure, so the impact of the 
Russian war on Ukraine on the country’s energy security remains limited.  

Work on electricity transmission interconnections between Montenegro and Serbia continued. 
The ecological  reconstruction of the thermal power plant Plevlja started at  the end of April 
2022,  with  a  three-year  delay.  The  completion  of  this  project  is  expected  in  October  2024. 
Montenegro’s  government  maintains  that  following  the  reconstruction,  the  plant  will  be 
operating within the emission limits set by the large combustion plants directive.   

There was no noticeable progress  on the  administrative capacity of the national  authorities, 
which needs to be strengthened.  

Concerning the internal energy market, the first steps towards achieving a competitive day-
ahead electricity market have been implemented. A consortium between the European Power 
Exchange  (EPEX  SPOT)  and  the  Slovenian  BSP  South  Pool  won  the  tender  and  signed  a 
service  agreement  for  the  implementation  of  the  day-ahead  market.  Work  progresses, 
including  negotiations  on  coupling  the  market  with  neighbouring  countries.  In  November 
2021, the Energy and Water Regulatory Agency of Montenegro approved new rules on long-
term, daily and intraday capacity allocation for the border between Serbia and Montenegro. 
The  law  on  surveillance  of  wholesale  electricity  and  gas  market,  aligned  with  the  REMIT 
Regulation, entered into force in January 2022. 

On hydrocarbons, national legislation is aligned with the hydrocarbons licensing directive. 
The  law  on  safety  measures  in  offshore  exploration  and  production  of  hydrocarbons  is 
pending adoption by the parliament. Montenegro has so far awarded two concession contracts 
for  offshore  hydrocarbon  exploration  and  production  in  2016  and  2017.  The  exploration 
period for one concessionaire has been extended to September 2022. In accordance with the 
concession  agreement,  the  second  concessionaire  is  obliged  to  find  a  new  partner,  to  be 
approved  by  the  government  to  receive  a  further  extension  of  the  exploration  rights.  It 
remains  under  Montenegro’s  remit  to  ensure  compliance  of  the  concession  holders  with 
environmental  liability  rules  and  rule  of  law  standards  through  contractual  obligations.  The 
construction  of  Montenegro's  section  of  the  Ionian-Adriatic  Gas  Pipeline  (IAP)  has 
cumulated a serious delay. Work on the preliminary design of this section was completed in 
October 2021, while a public consultation on the environmental and social impact assessment 
documentation  is  yet  to  be  implemented.  The  advancement  of  the  project  depends  on  the 
ability  of  the  government  to  conclude  appropriate  public  consultations  and  reach  an 
agreement with concerned municipalities on the preferred alignment.  

In  the  area  of  renewable  energy,  43.8  %  of  gross  final  consumption  of  energy  came  from 
renewable  sources  in  2020,  which  exceeded  the  33%  target  to  be  achieved  by  2020  under 
Montenegro’s  national  action  plan.  In  July  2021,  the  government  decided  to  stop  previous 
schemes  providing  price  subsidies  for  electricity  produced  from  renewable  sources  and 
highly  efficient  cogeneration.  In  March  2022,  the  government  granted  a  concession  for  the 

109 

 
 
construction, maintenance and use of the Komarnica hydropower plant to the national energy 
company,  EPCG.  The  government  also  adopted  decisions  on  terminating  concession 
agreements for constructing several small hydropower plants. Progress has been made in the 
development  of spatial  plans and environmental impact  assessments for the implementation 
of  wind  farms  and  solar  power  plants.  It  remains  essential  that  the  development  of  new 
renewable energy projects, particularly on hydropower, are carried out in conformity with the 
EU acquis on concessions, State aid and the environment. 

In the area of energy efficiency, some progress was made in alignment with the EU acquis, 
with  the  adoption  of  implementing  legislation  on  requirements  for  eco-design  and  energy 
efficiency  labelling  of  energy-related  products.  The  National  Energy  and  Climate  Plan 
(NECP),  once  adopted,  will  replace  the  existing  energy  efficiency  action  plan  as  the  key 
planning  document  in  the  area  of  energy  efficiency.  The  Ministry  of  Capital  Investments 
continued coordinating several programmes on energy efficiency improvement for public and 
private households. In October 2021, the “Energy Efficient Home” pilot programme opened 
to citizens the opportunity of interest-free loans for implementing energy efficiency measures 
in households. The energy efficiency fund has not been established yet. There have been no 
developments  in  improving statistical  data  collection  and monitoring the implementation of 
the energy efficiency action plan. 

Regarding  nuclear  energy,  nuclear  safety  and  radiation,  Montenegro  does  not  have  a 
nuclear  industry,  research  reactor  or  any  other  facility  producing  radioactive  materials  and 
national  legislation prohibits the construction of nuclear facilities. The country continues to 
cooperate in several regional initiatives for the early exchange of information in the event of 
radiological emergency (ECURIE). However, it is yet to join the European Radiological Data 
Exchange Platform and currently has no intention to participate in the Capital and Advisory 
Committee of the Euratom Supply Agency. 

Chapter 21: Trans-European networks 

The EU promotes trans-European networks in transport, telecommunications and energy to 
strengthen the internal market and contribute to growth and employment. 

Montenegro remains moderately prepared /has a good level of preparation in the area of 
trans-European  networks.  There  was  limited  progress  on  the  implementation  of  the 
Transport Development Strategy, primarily on the development of rail projects. Last year’s 
recommendations remain valid.  

In the coming year Montenegro should in particular: 

  review the Transport Development Strategy to align it with the Strategy for Sustainable 
and  Smart  Mobility  in  the  Western  Balkans,  confirming  a  shift  towards  greener 
transport modes; 

  revise  institutional  policies  to  improve  the  efficiency  of  managing  infrastructure 

projects and increase the funding absorption capacities;  

  ensure that capacitated staff is retained or hired for managing infrastructure projects in 

the areas of transport, telecommunications and energy.  

In December 2021 the government adopted a roadmap to fulfil conditions for the provisional 
closure of negotiations in chapter 21. 

On  transport  networks,  Montenegro  continued  to  actively  participate  in  the  work  of  the 
Transport Community Treaty (TCT). In December 2021, the government adopted the 2021-

110 

 
 
 
2022 action plan for the Transport Development Strategy. The strategy needs to be reviewed 
in 2022, to align it with the TCT obligations, notably the Strategy for Sustainable and Smart 
Mobility in the Western Balkans. The revision will bring about a shift towards greener and 
more sustainable modes of transport, in line with the current EU policies. The long-awaited 
law on railways is expected to clearly define responsibilities of railway regulatory body and 
operational  implementing  agencies. Montenegro  is a member of the Western Balkans Road 
Safety Observatory, established in July 2021.  

In December 2021, the  government  adopted a new single project  pipeline (SPP) document, 
which  includes  numerous  projects  in  the  areas  of  energy  and  transport.  However,  the  cost 
estimates and maturity statements on transport projects were not updated and reflect the data 
and prices from 2017. In view of the increases in construction costs, the pipeline of EUR 3.7 
billion investments in transport projects would need to be evaluated with caution. The impact 
of  such  plans  on  the  country’s  budget  and  fiscal  space  is  yet  to  be  assessed.  Moreover, 
Montenegro needs to change its institutional approach to improve the efficiency of managing 
infrastructure projects, in order to increase its funding absorption capacities.  

On infrastructure development, several priority road projects were suffering delays. Works 
on  the  priority  section  of  Bar-Boljare  highway  (Smokovac  –  Matesevo)  continued.  The 
section was finally opened to traffic in July 2022, with a three-year delay. The applicable toll 
rate for passenger vehicles on the completed section of the highway is 8 cents per km, 60% 
above  the  rate  recommended  by  the  EU-financed  feasibility  study  and  cost-benefit  analysis 
for the entire Bar-Boljare highway (5 cents). The study, which includes recommendations on 
construction standards, toll rates and means of financing for the remaining sections, should be 
adopted  in  2022.  The  preliminary  design  work  on  Budva  bypass  section  of  the  Adriatic-
Ionian  expressway  progressed  very  slowly,  hampered  by  Montenegro’s  legislation  on 
preliminary design requirements for complex infrastructure, which leads to excessive design 
costs  and  causes  delays.  As  a  result,  the  European  Commission  cancelled  the  investment 
grant of EUR 41.2 million, inviting for re-application should project maturity be attained. 

On the rail network, works on different rail projects continued with EU funding, including on 
the upgrading of the Bar-Vrbnica railway and a feasibility study on Podgorica-Tuzi-Albania 
border railway.  

On energy networks, progress continued in interconnecting the electricity systems of Serbia, 
Bosnia and Herzegovina, Italy and Montenegro. The construction of Montenegro's section of 
the  Ionian-Adriatic  Gas  Pipeline  (IAP)  has  so  far  cumulated  a  serious  delay.  Work  on  the 
preliminary  design  of  this  section  was  completed  in  October  2021,  while  a  public 
consultation  on  the  Environmental  and  Social  Impact  Assessment  (ESIA)  documentation  is 
yet to be implemented. The advancement of the project is very much depending on the ability 
of the Government to instigate appropriate public consultations and reach an agreement with 
concerned municipalities on the preferred alignment.   

Overall,  infrastructure  investments  need  to  comply  fully  with  the  EU  standards  on  public 
procurement,  State  aid  and  environmental  impact  assessment.  New  investments  need  to 
address  changing  strategic  priorities,  decarbonisation,  digitalisation  and  resilience  of 
transport and energy networks, all with prior cost-benefit analyses carried out in line with EU 
best practice.  

 Montenegro  is  yet  to  fully  align  its  legislation  with  the  TEN-T  and  TEN-E  EU  acquis.  A 
legislative gap analysis was prepared. 

Chapter 27: Environment and climate change 

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The  EU  promotes  strong  climate  action,  sustainable  development  and  protection  of  the 
environment. EU law contains provisions addressing climate change, water and air quality, 
waste  management,  nature  protection,  industrial  pollution,  chemicals,  noise  and  civil 
prothection. 

Montenegro  has  some  level  of  preparation  in  this  area.  Limited  progress  was  made  in 
further  aligning  with  the  EU  acquis,  on  water,  nature  protection  and  climate  change. 
Significant  efforts  are  still  needed  on  implementation  and  enforcement,  in  particular  on 
waste  management,  water  quality,  nature  protection  and  climate  change.  Montenegro 
should considerably step up its ambitions towards a green transition. 

In the coming year, Montenegro should in particular: 

  intensify  implementation  and  enforcement  work  for  the  fulfilment  of  the  closing 
benchmarks  in  the  Chapter  27,  in  particular  in  the  water,  nature  protection,  and 
climate change sectors;  

  finalise the waste management law and the national waste management plan;  

  finalise,  adopt  and  start  implementing  the  national  energy  and  climate  plan  in  a 
transparent  manner,  in  line  with  the  EU’s  2050  zero  emission  target  and  the  Green 
Agenda for the Western Balkans. 

Environment  

On  horizontal  legislation,  in  October  2021,  the  government  adopted  the  first  semi-annual 
report on the implementation of the action plan for the fulfilment of the closing benchmarks 
in  Chapter  27.  In  December  2021,  the  government  adopted  the  financial  assessment  of  the 
action plan for the fulfilment of the closing benchmarks in Chapter 27, covering 2021-2025, 
indicating  financial  needs  amounting  to  nearly  EUR  483  million.  In  the  reporting  period, 
Montenegro  completed 
(SEA)  and  53 
environmental  impact  assessments  (EIA).  On  environmental  crime,  in  the  reporting  period, 
101  new  cases  were  registered  and  46  cases  were  legally  resolved.  The  lack  of  sufficient 
administrative  capacities  at  central  and  local  level  and  inspection  bodies,  insufficient  inter-
institutional coordination and lack of a sustainable financial framework remain challenges to 
be urgently addressed. The position of the head of the working group for Chapter 27 remains 
to be filled.  

five  strategic  environmental  assessments 

As  regards  air  quality,  in  October  2021,  the  government  adopted  the  decree  on  emission 
limit values from combustion plants and the method of calculating emission limit values for 
plants  using  several  types  of  fuel.  As  in  the  previous  reporting  period,  the  adoption  of  the 
strategy  on  air  quality  management  for  the  period  2021-2029,  as  well  as  of  the  action  plan 
2021-2022, remain pending.   

In  the  area  of  waste  management,  alignment  remains  partial.  Considerable  efforts  on 
strategic  planning  and  investments  are  needed  to  implement  the  national  strategy  for  waste 
management  until  2030.  Work  on  the  law  on  waste  management  continued  during  the 
reporting  period.  A  new  national  waste  management  plan  remains  to  be  drafted.  Over  the 
reporting period, recycling yards with a sorting plant were built in the municipalities of Plav 
and Petnjica. However, infrastructure for separate waste collection and recycling remains to 
be established in most of the country’s territory and illegal and temporary waste disposal to 
be resolved. A feasibility study for the construction of a regional waste management centre in 
Bijelo  Polje  has  been  finalised.  It  will  serve  all  municipalities  in  the  northern  part  of 
Montenegro. 

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Alignment  on  water  quality  remains  limited.  In  March  2022,  the  government  adopted  the 
water  management  plans  for  the  Danube  and  Adriatic  basins.  Significant  efforts  are  still 
needed to implement the water quality acquis. In order to implement the Floods Directive, an 
analysis of the existing flood protection infrastructure has been done and a preliminary risk 
assessment has been carried out, while the development of maps of flood hazards and flood 
risks  started.  Further  work  for  alignment  with  the  acquis  was  pursued  as  concerns  water 
intended for human consumption and for implementing the bathing water directive.   

In the area of nature protection, Montenegro is partially aligned with the EU acquis. In the 
last quarter of 2021 the government declared the two marine nature parks "Katič" and "Stari 
Ulcinj"  as  protected  areas.  Following  the  July  2021  decision  of  the  government’s 
privatisation council on  Ulcinj Salina land as state-owned, the  adoption  of the privatisation 
council  decision  by  the  Government  is  pending.  Since  December  2021,  an  EU  expert 
supports further work to develop the management model for the national park Ulcinj Salina. 
Activities  regarding  Natura  2000  have  continued  over  reporting  period,  funded  by  the 
national budget. Recommendations of the Bern Convention related to Skadar Lake still need 
to  be  addressed.  Montenegro  should  use  support  provided  to  establish  its  Emerald  network 
based  on  Natura  2000  mapping  information.  Following  Bar-Boljare  highway  construction 
negative impact, Tara river remediation work has been completed for the first location Uvač, 
in line with the remediation plan.  

On  industrial  pollution  control  and  risk  management,  Montenegro  remains  partially 
aligned  with  the  EU  acquis.  Further  implementing  legislation  was  adopted  to  the  law  on 
industrial  emissions.  Activities  continued  in  the  field  of  industrial  waste  management. 
Reconstruction  of  the  Pljevlja  coal  power  plant  to  meet  EU  emission  standards  started  in 
April 2022. Its completion is expected in more than two years.  

On  chemicals,  the  government  adopted  implementation  reports  as  concerns  the  Stockholm 
Convention 2019-2023 and the Minamata Convention, jointly with the action plan 2022-2023 
and  the  Minamata  initial  assessment.  A  memorandum  of  cooperation  among  different 
national  stakeholders  was  signed  to  improve  inter-institutional  cooperation  in  the  area  of 
chemicals.  

On  noise,  the  capital  city  of  Podgorica,  in  line  with  strategic  documents  in  the  field  of 
environmental noise protection, has started the implementation of noise monitoring programs 
at 11 resident locations. 

On  civil  protection,  Montenegro  has  been  a  member  of  the  Union  Civil  Protection 
Mechanism  since  April  2015.  In  December  2021,  the  work  on  the  development  of  the 
National  Risk  Assessment  for all types of hazards  affecting Montenegro was completed,  as 
part of a project funded by the EC. The document was acknowledged through the adoption by 
the  government  of  Montenegro.  The  necessary  communication  equipment  (sTESTA)  is 
installed in the premises of the Police Directorate. In view of this Montenegro is fulfilling the 
pre-requisite to connect to the Common Emergency Communication and Information system, 
commonly referred to as CECIS. 

Climate change 

Montenegro’s  level  of  alignment  on  climate  change  remains  limited.  Montenegro  has  a 
climate change strategy in place, but has to intensify its work to ensure consistency with the 
EU  2030  climate  and  energy  policy  framework.  It  also  needs  to  ensure  that  its  strategy  is 
integrated into all relevant sectoral policies and strategies. Montenegro needs to enhance its 
administrative  capacity 
the  acquis. 
Considerable  work  is  still  required  to  align  with  the  EU  acquis,  such  as  to  incorporate 

implementation  and  enforcement  of 

to  enable 

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remaining  elements  of  the  EU  Emissions  Trading  System  (ETS),  the  Effort  Sharing 
Regulation and the Governance Regulation. In December 2021, the government adopted the 
third biennial update report on climate change of Montenegro. The report has been finalised 
with revised calculations of greenhouse gas emissions for the period 1990-2019, in line with 
the  new  methodology  of  the  2006  IPCC  Intergovernmental  Panel  on  Climate  Change. 
Montenegro  has  been  granted  World  Bank  support  in  order  to  achieve  carbon  pricing 
readiness through the Market  Implementation Partnership (PMI) program.  Montenegro took 
initial  steps  for  the  development  of  its  low  carbon  development  strategy.  The  work  on  the 
development of the national energy and climate plan continued, finalisation expected by mid-
2024. Montenegro took part in the conference of the UN Framework Convention on Climate 
Change (COP26) in late 2021. In March 2022, the government adopted the second report on 
the implementation of the national strategy for climate change. 

CLUSTER 5: RESOURCES, AGRICULTURE AND COHESION  

This cluster covers chapters 11-agriculture and rural development, 12-food safety, veterinary 
and  phystosanitary  policy,  13-fisheries,  22-regional  policy  &  coordination  of  structural 
instruments, and 33-financial & budgetary provisions All five chapters are open, with closing 
benchmarks that remain to be fulfilled in each chapter. This cluster comprises policies linked 
to European structural funds, requiring particular preparation for developing the capacities to 
assume responsibilities of a future Member State.  

Progress was achieved in different areas e.g. in agriculture, food and fisheries through further 
support  for  agricultural  establishments  and  rural  food  companies  to  align  with  the  EU 
standards and in implementing IPARD. On financial and budgetary provisions, progress was 
achieved through improved coordination and management of own resources. 

In the coming period, Montenegro is invited to focus on the following areas: use to the best 
possible extent the remaining budget under IPARD II programme to use to the highest step 
up  the  implementation  of  the  IPARD  programme  and  to  finalise  the  national  strategies  on 
agriculture  and  rural  development  as  well  as  on  fisheries  for  the  2022-2027  period;  to 
continue  upgrading  food  establishments  and  further  strengthen  administrative  capacity  in 
particular  on  food  safety  controls  and  fisheries;  to  update  the  action  plan  for  meeting  EU 
cohesion policy requirements while strengthening capacities to manage IPA programmes; to 
further  align  the  institutional  framework  and  rules  of  administration  for  the  own  resources 
system.   

Chapter 11: Agriculture and rural development 

The  common  agricultural  policy  supports  farmers  and  rural  development.  This  requires 
strong management and control systems. There are also common EU rules for quality policy 
and organic farming. 

Montenegro remains moderately prepared in the area of agriculture and rural development. 
Some  progress  was  achieved  on  last  year’s  recommendations,  mainly  regarding  the 
instrument  for  pre-accession  assistance  for  rural  development  programmes  (IPARD  II  and 
III)  through  further  calls  for  applications,  request  for  entrustment  for  the  ‘Technical 
assistance’ measure and for adoption of the  IPARD III (2021-2027) programme, as well as 
strengthening of the capacity of the IPARD agency. The implementation of the action plan on 
EU acquis alignment and the new sector strategy development was limited. 

In the coming year, Montenegro should in particular: 

  use to the best possible extent the remaining budget under IPARD II programme, seek a 
rollover  entrustment  for  the  already  entrusted  measures  to  IPARD  III  (2021-2027) 

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programme  and  work  on  completing 
diversification and business development’ and ‘Technical assistance’; 

the  entrustment  of 

the  measures  ‘Farm 

  continue  to  implement  the  action  plan  for  alignment  with  the  EU  acquis  on  agriculture 
and  rural  development,  and  adopt  the  strategy  for  agriculture  and  rural  development 
2022-2028. 

On  horizontal  issues,  drafting  of  the  2022-2028  strategy  for  agriculture  and  rural 
development started. The action plan for the EU acquis alignment was updated to cover the 
period without a strategy and calls for accelerated implementation. Progress still needs to be 
achieved  by  fully  decoupling  direct  payment  measures  from  production  while  linking 
payments to cross-compliance requirements. 

Setting  up  of  the  integrated  administration  and  control  system  (IACS)  needs  to  be  speeded 
up.  Some  more  agricultural  plots  and  holdings  were  registered  in  the  land  parcel 
identification system (LPIS) which remains to be rolled out to the whole territory. There was 
good  progress  for  the  farm  accountancy  data  network  (FADN)  through  development  of 
software and training. Farm advisory services remain to be strengthened. 

On  common  market  organisation  (CMO),  implementation  of  the  Action  plan  for  CMO 
alignment remains to be stepped up. 

The  Law  on  amendments  to  the  Law  on  olive  growing  and  olive  oil,  which  will  allow 
strengthening of the inspections and improving the quality of the olive oil,  is currently with 
the Parliament.  

A  new  draft  law  on  spirit  drinks  has  been  elaborated,  taking  into  account  Regulation  (EU) 
2019/787. It was adopted by the government in July 2022.  

On rural  development,  altogether nine  IPARD  calls  under the  IPARD  II programme  were 
realised  in  total  (3  new  calls  in  the  reporting  period),  for  the  measures  ‘Investments  in 
physical  assets  of  agricultural  holdings',  ‘Investments  in  physical  assets  concerning 
processing and marketing of agricultural and fishery products’ and ‘Farm diversification and 
businesses  development'.  The  IPARD  measure  ‘Technical  assistance’  was  submitted  for 
entrustment in February 2022. Slow implementation led to the first de-commitment of funds 
after  the  end  of  the  financial  year  2021  and  there  is  a  considerable  risk  of  further  loss  of 
IPARD funding. Therefore, stronger efforts are needed to fully absorb the funds in 2022 and 
2023.  Montenegro’s  IPARD  III  programme  was  approved  by  the  European  Commission  in 
June 2022. Strengthening of the administrative capacity of the IPARD Agency in 2022 was 
supported  with  an  amendment  of  the  Systematization  Act  of  the  MAFWM,  stipulating 
additional 25 posts for the IPARD activities. 

On quality policy, efforts continue to develop this policy area. All recommendations of the 
EU Peer Review Mission in November 2019 must be followed up. 

On  organic  farming,  the  potential  for  further  development  and  expansion  of  the  sector 
remains to be supported. The law on organic production, to align with the EU acquis, is being 
drafted.  

Chapter 12: Food safety, veterinary and phytosanitary policy 

EU hygiene rules for foodstuff production ensure a high level of food safety. Animal health 
and welfare and the safety of food of animal origin are safeguarded together with the quality 
of seed, the plant protection material, the protection against harmful organisms and animal 
nutrition.  

Montenegro remains moderately prepared on this chapter. Good progress was made on 

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previous year’s recommendations by implementing the national strategy for aligning with 
and implementing the EU acquis and in the upgrading of establishments. Administrative 
capacities and disease surveillance should be stepped up. 

In the coming year Montenegro should in particular: 

  continue  to  implement  and  update  the  revised  strategy  for  aligning  with  and 

implementing the EU acquis; 

  further increase the share of food establishments compliant with EU standards; 

  step up the strengthening of administrative capacity and infrastructures, in  particular 
on food safety controls, and implement robust disease surveillance and vaccination, as 
applicable. 

On  general  food  safety,  the  revised  strategy  for  aligning  with  and  implementing  the  EU 
acquis, and the specific action plan for classical swine fever were implemented on schedule 
and  further  implementing  legislation  was  adopted.  The  2021  programme  for  food  and  feed 
safety  measures  was  implemented  and  the  programme  for  2022  was  adopted  and  it  is  in 
implementation.  

On  veterinary  policy,  the  programme  of  mandatory  animal  health  protection  measures  for 
2021 was implemented. The programme for 2022 was adopted and it is being implemented. 
Surveillance  programmes  were  implemented  for  bluetongue  disease  and  classical  swine 
fever,  where  one  sample  showed  presence  of  bluetongue  virus  genome,  but  vector 
surveillance  showed  none.  Montenegro  has  resumed  vaccination  against  rabies  with  EU 
support as of spring 2022 and until autumn 2023. Taking full ownership, Montenegro should 
transition  to  using  its  own  means  for  future  campaigns  in  line  with  relevant  EU  acquis 
obligations  and  should  urgently  set  up  and  implement  robust  disease  surveillance. 
Strengthening  of  regional  alliances  in  the  fight  against  cross-border  animal  diseases  was 
agreed at the forum of directors of veterinary services of the Western Balkans. 

The first case of Avian influenza was detected in Montenegro on April 6 2022 in a deceased 
pelican, followed by others. Measures are put in place to control the disease in line with the 
relevant national legislation, and the recommendations and standards of relevant international 
organisations. 

Regarding African swine fever, there are no reported cases of the disease in Montenegro so 
far.  Montenegro  has  been  closely  monitoring  the  situation  and  responding  with  appropriate 
measures, in line with the relevant legislation. The government adopted a programme for the 
control of the dog population in Montenegro in July 2021.  

On  placing  on  the  market  of  food,  feed  and  animal  by-products,  the  upgrading  of  food 
establishments  continued,  with  now  more  than  50%  compliance.  The  total  number  of 
establishments  concerned  decreased  from  156  to  133  since  2015/2016.  There  are  now  19 
facilities  licensed  to  export  to  the  EU.  The  National  Program  for  the  improvement  of 
establishments  dealing  with  products  of  animal  origin  and  of  establishments  dealing  with 
animal by-products was amended in December 2021.  

Montenegro continued to implement the national programme for improving raw milk quality 
and  handling  non-compliant  milk.  Increased  digital  data  exchange  is  expected  according  to 
plan.  

The  programme  of  food  and  feed  safety  measures  for  2021  was  implemented  and  the 
programme for 2022 was adopted. The programme of phytosanitary measures for 2021 was 
implemented and the programme for 2022 was adopted. Additional implementing legislation 

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concerning  the  phytosanitary  sector  was  adopted.  The  National  plan  for  sustainable  use  of 
pesticides  for  the  period  from  2021  to  2026  was  also  adopted  and  is  currently  being 
implemented.  Planning  for  the  construction  of  the  National  Reference  Phytosanitary 
Laboratory advanced.  

On genetically modified organisms, the 2021 programme for genetically modified food and 
feed monitoring was implemented and the programme for 2022 was adopted and it is being 
implemented. 

Chapter 13: Fisheries  

The  common  fisheries  policy  lays  down  rules  on  fisheries  management,  protects  living 
resources  of  the  sea  and  limits  the  environmental  impact  of  fisheries.  This  includes  setting 
catch  quotas,  managing  fleet  capacity,  rules  on  markets  and  aquaculture  and  support  for 
fisheries and coastal communities.  

Montenegro  has  some  level  of  preparation  in  this  area.  Limited  progress  was  made  on 
the recommendations of the last report, which remain valid. Montenegro continued to be a 
reliable partner in international fora. 

In the coming period, Montenegro should in particular: 

  finalise  its  work  in  preparation  of  the  new  fisheries  and  aquaculture  strategy  with  the 

action plan on aligning with and enforcing the EU acquis; 

  continue to  strengthen administrative, data collection, scientific advice, inspection and 

control capacities; 

  continue,  within  the  General  Fisheries  Commission  for  Mediterranean  (GFCM),  the 

implementation of the multiannual plan for demersal species in the Adriatic. 

Montenegro  continued  to  implement  its  action  plan  on  aligning  with,  implementing  and 
enforcing the EU acquis under this chapter. The preparation of a fisheries sectorial study was 
finalised  as  the  baseline  for  the  new  fisheries  and  aquaculture  strategy  2023-2028  and  its 
action  plan.  The  Law  on  market  organisation  in  fisheries  and  aquaculture  and  the  Law  on 
structural  measures  and  State  aid  in  fisheries  and  aquaculture  are  pending  adoption  by  the 
Parliament. 

On  resource  management,  the  implementation  of  the  activities  within  the  annual  data 
collection  programme  on  Montenegrin  fisheries  for  2021  continued  for  the  collection  of 
commercial  catch data,  while COVID-19 prevented the collection of biological  data.  In the 
area  of  fleet  management,  following  a  public  call  on  fleet  modernisation,  contracts  were 
signed with 19 commercial fishers in December 2021. 

Regarding  inspections  and  control,  new  functionalities  are  being  added  to  the  Fisheries 
Information  System  and  an  electronic  licensing  system  for  sport  and  recreational  fishing  is 
nearing completion. Dialogue with Albania continued to harmonise the management of the joint 
European eel resources and on control of illegal, unreported and unregulated fishing (IUU). The 
port  of  Bar  was  designated  as  the  port  open  for  foreign  fishing  vessels.  On  data  collection, 
efforts should mainly focus on scientific observers on board of fishing vessels and on recreational 
fisheries.  There  were  no  substantial  developments  on  structural  actions,  market  policy  and 
State aid. 

At  the  international  level,  the  Blue  Land  project,  within  INTERREG  programmes,  was 
successfully  finalised.  Montenegro  also  continued  its  cooperation  with  FAO  AdriaMed, 
MedFish4Ever and the General Fisheries Commission for the Mediterranean (GFCM). Here, 

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the implementation of the multiannual plan for demersal species in the Adriatic still suffers 
from the discontinuation of FAO AdriaMed support and the lack of national funding. 

Chapter 22: Regional policy and coordination of structural instruments  

Regional  policy  is  the  EU’s  main  investment  policy  for  sustainable  and inclusive  economic 
growth.  Member  States  bear  responsibility  for  implementation,  which  requires  adequate 
administrative capacity and sound financial management of projects' design and execution. 

Montenegro  is  moderately  prepared  in  the  area  of  regional  policy  and  coordination  of 
structural instruments. Limited progress was made over the reporting period, particularly 
in respect of key decisions yet to be reached on the institutional framework for preparing to 
future  cohesion  policy  and  on  administrative  capacity,  which  remains  weak.  2021 
recommendations remain largely valid. 

In the coming year Montenegro should in particular:  

  update the action plan and restart its implementation for meeting requirements deriving 

from EU cohesion policy;  

  invest  in  increasing  and  consolidating  the  administrative  capacity  of  central,  regional 
and local bodies to more effectively safeguard IPA funds, and to put in place a structure 
to  manage  future  cohesion  policy  funds.  Strengthen  capacities  in  procurement, 
management  and  monitoring  of  capital  investments,  while  also  reinforcing  existing 
coordination mechanisms;  

  create  a  credible  pipeline  of  projects,  along  with  a  framework  for  strategic  sectoral 
orientations  and  policies,  while  improving  their  preparation,  procurement  and 
implementation in line with EU and international standards. 

Regarding  the  legislative  framework,  some  progress  has  been  registered  in  the  field  of 
public  procurement  and  competition  law.  The  strategies  for  enhancing  public  procurement 
and  public-private  partnership  policy  in  Montenegro  for  the  period  2021-2025  and  the 
accompanying action plan were adopted in October 2021. The preparation of amendments to 
the  Public  Procurement  Law,  which  aim  at  the  harmonization  of  legal  provisions  with  the 
electronic  public  procurement  system,  have  not  been  finalised.  There  was  further 
harmonization in the field of competition with the adoption in December 2021 of the Law on 
Amendments  to  the  Law  on  Protection  of  Competition,  chiefly  concerning  the  manner  and 
requirements for selection of the Council of Agency for the Protection of Competition (APC) 
members and its management. 

On the institutional framework limited progress was registered. According to the Roadmap 
for fulfilling the  remaining obligations for chapter 22, the  Law on European Structural  and 
Investment funds, which is to formalise and legally define such a framework is currently only 
planned for the third quarter of 2024. However, the EU regulation establishing the IPA III for 
the period 2021-2027 has emphasized the importance and urgency of such a definition. The 
institutional set up and the system for management of IPA funds in indirect management still 
needs to be adapted to IPA III requirements. Decisions on the appointment of institutions and 
bodies that will implement  IPA  III  should be  formalised urgently, taking into account  their 
future role in cohesion policy.  

On  administrative  capacities,  the  lack  of  adequate  resources  for  procurement,  contract 
management  and  preparation  and  implementation  of  key  structural  reforms  remains  a 
weakness.    The  implementation  of  the  staff  retention  policy  was  resumed  in  the  second 
semester  of  2021,  being  implemented  through  a  salary  supplement  for  staff  within  IPA 

118 

 
 
structures.  However,  the  hiring  of  additional  experienced  staff,  the  delivery  of  targeted 
trainings, as well as clearer strategic directions from management boards from the Ministries, 
remains necessary so to build capacity and motivate staff. The contracting of IPA 2017 funds 
by  December  2021  resulted  in  a  better  performance  compared  to  the  previous  year.  This 
noted,  coordination  between  the  contracting  authorities  and  line  ministries  still  requires 
strengthening. Significant capacity strengthening is also still needed to achieve efficiency in 
the preparation and implementation of public procurement, while the contracting of IPA 2018 
funds  are  still  at  risk,  and  preparatory  activities  for  the  procurement  of  IPA  2020  funds 
proceed at too slow a pace. Greater investment in resources, particularly in the Public Works 
Administration, is needed. The capacities of indirect management structures  still need to be 
further strengthened to ensure they can effectively operate in an ex-post control environment. 

Chapter 33: Financial and budgetary provisions 

This  chapter  covers  the  rules  governing  the  funding  of  the  EU  budget  (‘own  resources’). 
These  resources  mainly  consist  of:  (i)  contributions  based  on  the  gross  national  income  of 
each  Member  State;  (ii)  customs  duties;  (iii)  the  non-recycled  plastic  resource;  and  (iv)  a 
resource based on value-added tax. Member States must have the appropriate administrative 
capacity  to  adequately  coordinate  and  ensure  the  correct  calculation,  collection,  payment 
and control of own resources. 

Montenegro  has  some  level  of  preparation  regarding  EU  financial  and  budgetary 
provisions. Limited progress was made in meeting last year’s recommendations, mostly on 
increased  capacities  of  the  Directorate  for  coordination  and  management  of  EU  own 
resources within the Ministry of Finance. The 2021 recommendations remain largely valid.  

In the coming year, Montenegro should, in particular: 

  further  set  up  the  institutional  framework  and  rules  of  administration  for  the  own 

resources system; 

  further  align  the  legal  basis  for  the  underlying  policy  areas  affecting  the  correct 
application  of  the  own  resources  system:  taxation  (VAT),  customs  union,  financial 
control and statistics; 

  continue strengthening the capacity of the Directorate for coordination and management 
of EU own resources and of all other institutions involved in the own resources system. 

Overall, there was little progress in the underlying policy areas indirectly affecting the own 
reources system (for progress in these areas, see Chapters 16 – Taxation, 18 – Statistics, 29 – 
Customs union, and 32 – Financial control).  

On  traditional  own  resources,  analysis  of  the  accounting  rules  (A&B  accounts)  and 
definition  of  income  according  to  its  future  classification  continued,  including  simulation 
exercises on A and B accounting and on submission of reports on detected cases of fraud and 
irregularities.  Efforts  continued  on  fraud  reporting  in  line  with  the  own  resources  database 
(OWNRES) requirements. Implementing legislation concerning compulsory enforcement on 
movable and immovable property is under preparation in line with the provisions of the Law 
on  tax  administration.  On  the  collection  of  customs  debt,  instructions  for  writing-off  of 
customs  debt  have  yet  to  be  finalised  in  conformity  with  the  new  Customs  law  adopted  in 
July 2022.  

On  value  added  tax-based  resource,  in  December  2021,  further  amendments  to  the  value 
added  tax  (VAT)  law  led  to  a  reduction  in  trade  taxation  of  food  and  beverages,  with  the 
exception  of  alcoholic  beverages,  carbonated  soft  beverages  containing  added  sugar  and 

119 

 
 
coffee. However, further alignment of the VAT law with the EU acquis remains necessary. 

On gross national income-based resources, Montenegro’s gross domestic product (GDP) is 
calculated  using  the  European  system  of  national  and  regional  accounts  (ESA)  2010 
methodology. Gross national income (GNI) data are available since 2010 and are published 
on the website of the Statistical  Office of Montenegro. Sustained efforts  are still needed as 
regards the exhaustiveness of the national accounts and GDP/GNI calculations. 

As regards administrative infrastructure, the Directorate for coordination and management 
of  own  resources  of  the  EU  within  the  Ministry  of  Finance  is  gradually  improving  its 
capacities  focusing  on  planning,  coordination  and  calculation  of  own  resources,  better 
definition  of  internal  procedures  and  instructions,  as  well  as  alignment  with  the  EU  own 
resources  administrative  conditions.  The  implementation  of  the  2019  own  resources  action 
plan  is  ongoing,  with  the  last  annual  progress  report  adopted  by  the  Government  in  June 
2022.  An  Action  Plan  for  addressing  the  key  recommendations  from  the  European 
Commission’s  Montenegro  2021  report  was  adopted  in  December  2021.  An  EU  funded 
project  supporting  the  establishment  of  Montenegro’s  management  system  of  EU  own 
resources started in May 2022.   

CLUSTER 6: EXTERNAL RELATIONS  

There  are  two  chapters  in  this  cluster:  namely,  chapter  30-external  relations,  which  was 
provisionally closed in June 2017, and chapter 31-foreign, security and defence policy, where 
the single closing benchmark (concerning Montenegro’s bilateral  immunity  agreement with 
the United States) has yet to be fulfilled.  

Montenegro  continues  full  alignment  with  the  EU’s  Common  Foreign  and  Security  policy 
including with the EU restrictive measures following Russia’s unprovoked aggression against 
Ukraine,  as  well  as  coordinating  its  positions  with  those  of  the  EU,  including  within  the 
WTO, and maintains good cooperation with international organisations.  

Progress can be noted on the adoption of the law on export control of dual-use goods, in line 
with  the  EU  acquis,  and  the  ratification  of  CEFTA  Additional  Protocol  6.  Montenegro  is 
invited  to  continue  legislative  alignment  where  necessary,  and  is  also  encouraged  to 
implement actions under the Common Regional Market, based on the EU rules. Montenegro 
is encouraged to continue its full alignment with all EU CFSP positions and declarations. The 
alignment with the EU common positions on the integrity of the Rome Statute would allow 
the provisional closure of the remaining chapter under this cluster.  

Chapter 30: External relations  

The  EU  has  a  common  trade  and  commercial  policy  towards  third  countries,  based  on 
multilateral and bilateral agreements and autonomous measures. There are also EU rules in 
the field of humanitarian aid and development policy. 

Montenegro has achieved a good level of preparation. Good progress was achieved in the 
past year, with the adoption of the law on export control of dual-use goods, in line with the 
EU acquis, and the ratification of CEFTA Additional Protocol 6 (AP 6) on trade in services. 
Amendments  to  the  country’s  legal  and  institutional  framework  on  development  and 
humanitarian aid are in preparation.  

In the coming year, Montenegro should in particular: 

  continue  to  actively  participate  in  the  implementation  of  actions  in  the  context  of  the 
Common Regional Market Action Plan 2021-2024 and in particular ensure constructive 
participation  in  the  negotiations  on  CEFTA  AP  7  on  dispute  settlement,  and  its  swift 

120 

 
 
ratification and start implementing CEFTA AP 6 on trade in services; 

  Adopt  amendments  to  the  Laws  on  international  development  cooperation  and 

international humanitarian assistance. 

In  November  2021,  the  government  adopted  a  roadmap  for  fulfilling  the  remaining 
obligations related to chapter 30. The document identifies key challenges for 2022 and 2023 
and  addresses  last  year’s  recommendations.  It  also  identifies  horizontal  links  with  other 
chapters and thematic clusters, in line with the revised enlargement methodology.  

On the common commercial policy, Montenegro continued to coordinate its positions with 
those  of  the  EU,  including  in  the  WTO.  In  this  context,  in  March  2022,  Montenegro 
supported  notably  the  Joint  Statement  on  aggression  by  the  Russian  Federation  against 
Ukraine with the support of Belarus.  

The Law on export control of dual-use goods was adopted in December 2021 and has been 
applied  since  January  2022.  It  contains  most  of  the  provisions  of  the  latest  EU  Regulation 
from May 2021, leaving out certain parts that could be applied only once  Montenegro joins 
the EU. This was complemented by the adoption of the national control list of dual-use goods 
in  March  2022,  aligned  with  the  latest  EU  list.  Earlier,  in  June  2021,  the  government 
amended its control list for export and import of goods, aligning it with the EU control list of 
2019. Montenegro`s application process to join the Wassenaar Arrangement is still ongoing. 
The application for membership in the Australia Group is under preparation.  

Following the decision to involve the European Investment Bank in the development of the 
implementing legislation on export credit insurance against non-market risks, the timeline for 
the adoption shifted to the last quarter of 2022. This piece of legislation follows the adoption 
of  the  Law  on  the  investment  and  development  fund,  which  regulates  the  issuing  and 
financing of export credits. 

Montenegro  continues  to  participate  actively  in  CEFTA  working  groups,  including  in 
negotiations on CEFTA AP 7 on trade dispute settlement, and fulfils its commitments within 
the Common Regional Market.  In December 2021, the parliament ratified CEFTA AP 6 on 
trade in services.  

In July 2021, the government adopted a new Montenegrin Bilateral Investment Treaty model 
that  will  serve  as  a  basis  for  future  treaties.  The  Common  Regional  Market  action  plan 
specifies  that  each  partner  needs  to  negotiate  economy-specific  International  Investment 
Agreements  (IIAs)  based  on  the  Regionally  Accepted  Standards  for  IIA  negotiations. 
Montenegro  has  24  bilateral  investment  treaties  currently  in  force,  more  than  half  with  the 
EU member states.  

Concerning  bilateral  trade  agreements,  in  December  2021  the  parliament  ratified  a  Free 
Trade  Agreement  (FTA)  with  EFTA  countries  on  the  rules  of  origin  related  to  the  revised 
Pan-Euro-Mediterranean (PEM) Convention. In December 2021, the parliament also ratified 
amendments  to  the  FTA  with  Türkiye,  aimed  to  ensure  additional  liberalisation  of  trade  in 
agricultural  products  and  access  to  the  services  market.  The  government  initiated 
amendments  to  the  FTA  with  Ukraine  concerning  rules  of  origin  and  methods  of 
administrative cooperation. 

Negotiations for an Agreement on Trade, Partnership and Cooperation between Montenegro 
and  the  United  Kingdom  of  Great  Britain  and  Northern  Ireland  are  ongoing.  Montenegro 
should  avoid  any  violation  of  its  obligations  arising  from  the  Stabilisation  and  Association 
Agreement. 

121 

 
 
On  development  policy  and  humanitarian  aid,  amendments  to  the  Law  on  international 
development cooperation and international humanitarian assistance are  being prepared, with 
the aim to improve the country’s legal and institutional framework in these areas. A database 
on  donor  support  projects  that  would  use  the  OECD  Development  Assistance  Committee 
methodology remains to be developed. 

Montenegro  should  continue  working  on  this  chapter  in  accordance  with  its  overall  action 
plan on external relations. 

Chapter 31: Foreign, security and defence policy  

Member States must be able to conduct political dialogues in the framework of the foreign, 
security  and  defence  policy,  align  with  EU  statements,  take  part  in  EU  actions  and  apply 
agreed sanctions and restrictive measures. 

Concerning  EU  foreign,  security  and  defence  policy,  Montenegro  has  a  good  level  of 
preparation.  Good  progress  was  made  as  the  country  continued  its  track-record  of  full 
alignment with the EU CFSP, including with the EU restrictive measures following Russia’s 
unprovoked aggression against Ukraine, as well as on Belarus, and has provided assistance 
to  Ukraine.  Montenegro  needs  to  align  with  EU  common  positions  on  the  integrity  of  the 
Rome  Statute  and  related  EU  guiding  principles  on  bilateral  immunity  agreements.  As  a 
Member of the Human Rights Council, Montenegro has been actively engaged in promoting 
and defending the rules-based international order.  

In the coming year, Montenegro should: 

 maintain its full alignment with the EU foreign, security and defence policy 

  adopt the strategy on countering hybrid threats and related action plan. 

The political dialogue between the EU and Montenegro on foreign and security policy issues 
continued,  including  through  Montenegro’s  active  engagement  in  the  EU-Western  Balkans 
informal CFSP Dialogue at political directors’ level.  

On  common  foreign  and  security  policy,  100%  alignment  with  all  relevant  High 
Representative  statements  on  behalf  of  the  EU,  and  Council  decisions  continued,  a  strong 
signal of Montenegro’s strategic commitment to the EU path.  This included all EU sanction 
packages against Russia and Belarus.  

Montenegro  also  aligned  with  the  EU  position  in  UNGA  when  voting  on  resolutions 
regarding  Russia’s  aggression  against  Ukraine  and  its  humanitarian  impact.  Montenegro 
voted for suspension of the Russian Federation in the UN Human Rights Council. 

In  March  2022,  the  caretaker  government  adopted  three  decisions  on  the  practical 
implementation  of  restrictive  measures  against  Russia  and  established  a  coordination  body 
that  should  monitor  the  implementation  of  international  measures  on  the  crisis  in  Ukraine. 
The implementation of those decisions is ongoing, including the identification and temporary 
confiscation  of  44  properties  owned  by  34  Russian  citizens  in  several  municipalities  of 
Montenegro.  

The  country  maintains  a  bilateral  immunity  agreement  with  the  United  States,  granting  US 
citizens exemptions from the jurisdiction of the International Criminal Court. In doing so, the 
country does not comply with the EU common positions on the integrity of the Rome Statute 
or related EU guiding principles on bilateral  immunity agreements.  Alignment  with  the EU 
position is therefore needed.  

122 

 
 
the 
Concerning  conflict  prevention,  Montenegro 
implementation of the Western Balkans SALW (Small Arms and Light Weapons) Roadmap 
and  implemented  its  2019-2025  strategy  and  action  plan  for  combating  illegal  possession, 
misuse and trafficking of SALW.  

remained  actively  engaged 

in 

Regarding non-proliferation, Montenegro is a state party to 29 international agreements in 
the field of CBRN and proliferation threats and risks. It is member to the Arms Trade Treaty, 
and  has  an  active  application  for  membership  in  the  Wassenaar  Arrangement.  The  country 
also expressed an interest to join the Australian Group regime. During the reporting period, 
the authorities finalised the draft roadmap for the period 2022-2027 to encompass measures 
addressing CBRN (chemical, biological, radiological and nuclear) threats and risks, as well as 
measures for the implementation of UNSC Resolution 1540.  

On security and defence, the implementation of the Defence Strategy adopted in 2019 and 
related action plan continued.  

Montenegro  continued  successful  cooperation  with  international  organisations  (UN, 
OSCE,  and  Council  of  Europe)  and  remained  an  active  member  in  NATO  missions, 
including in NATO KFOR in Kosovo and NATO NMI in Iraq. It continued to contribute to 
NATO presence on the Eastern flank by participating in enhanced Forward Presence (eFP). 
In the framework of NATO co-operation, in March 2022, Montenegro provided assistance to 
Ukraine with 300 ballistic vests, 500 helmets and 7,000 dry meal packages. Montenegro took 
active part in various NATO exercises and trainings.  

Montenegro  continued  participation  in  EU  crisis  management  missions  and  operations 
under  the  common  security  and  defence  policy,  namely  in  the  EU  NAVFOR  ATALANTA 
and the EU Training Mission (EUTM) in Mali, as well as in the UN peacekeeping operation 
MINURSO. 

Regarding  hybrid  threats,  Montenegro  completed  the  EU’s  hybrid  risk  survey  with  the 
objective of identifying systemic vulnerabilities and streamlining the assistance provided by 
the  EU  in  this  field.  Montenegro  maintained  active  participation  in  the  European  Centre  of 
Excellence  for  Countering  Hybrid  Threats.  Adoption  of  the  strategy  on  countering  hybrid 
threats and related action plan is still pending. Active response to enhancing cyber resilience 
against malicious behaviour in cyberspace is called for given the cyber-attack experienced in 
autumn 2022. 

123 

 
 
 
 
ANNEX I – RELATIONS BETWEEN THE EU AND MONTENEGRO  

Within  the  framework  of  the  accession  negotiations,  by  October  2022,  all  33  screened 
chapters, including chapters 23 and 24 on the rule of law, had been opened, three of which, 
i.e.  science  and  research,  education  and  culture  and  external  relations,  have  been 
provisionally closed. 

Montenegro  is  participating  in  the  Stabilisation  and  Association  Process.  Overall, 
Montenegro  continued  to  broadly  implement  its  obligations  under  the  Stabilisation  and 
Association  Agreement  (SAA).  Regular  political  and  economic  dialogue  between  the  EU 
and Montenegro has continued through the SAA structures. Regular subcommittee meetings 
were  held  throughout  the  period.  The  Stabilisation  and  Association  Committee  met  in 
January  2022  and  the  SA  Council  in  July  2022.  The  Stabilisation  and  Association 
Parliamentary Committee met in December 2021. 

Montenegro  participates  in  the  ministerial  dialogue  between  the  economic  and  finance 
ministers of the EU and the candidate countries, which aims at helping the latter to gradually 
meet  the  economic  accession  criteria  and  be  better  prepared  in  terms  of  economic  reforms, 
competitiveness and job creation. The most recent meeting was held on 24 May 2022. 

Visa  liberalisation  for  citizens  of  Montenegro  travelling  to  the  Schengen  area  has  been  in 
force  since  December  2009.  As  part  of  the  monitoring  mechanism  in  place  since  visa 
liberalisation, the Commission has been regularly assessing the progress made by the country 
in implementing reforms introduced under the visa roadmap. The Commission’s August 2021 
fourth report under the visa suspension mechanism concluded that Montenegro continues to 
meet  the  visa  liberalisation  benchmarks.  A  readmission  agreement  between  the  European 
Union and Montenegro has been in force since 2008. 

Under  the  Instrument  for  Pre-accession  Assistance  2021  –  2027 (IPA  III),  a  first  financing 
decision  of  EUR  32.41  million  was  adopted  at  the  end  of  2021,  providing  support  for  EU 
accession and post-COVID-19 recovery, and enhancing the country’s reforms in the areas of 
agriculture,  the  protection  of  the  environment,  transport  and  support  to  the  reform  of  the 
country’s  economic  governance  and  investment  planning.  This  first  set  of  programmes, 
complemented  by  a  significant  package  of  multi-country  programmes  and  the  rural 
development  programme  IPARD  III,  provide  a  significant  contribution  to  kick-start  the 
implementation of the Economic and Investment Plan for the Western Balkans and the Green 
and Digital Agendas.  

New activities will build on and add to the on-going programmes under IPA II (2014-2020), 
which are still providing significant support for the social and economic development of the 
country and contributing to key reforms in the Rule of Law, Public Administration Reform 
and other sectors. Montenegro also benefits from dedicated EU support  aimed at protecting 
the environment and boosting connectivity with EU transport systems. In addition, by the end 
of 2021 the specially  devised COVID-19 response Budget  Support  programme  finalised its 
important support to the authorities’ social and economic response to the crisis. 

Montenegro  continues  to  benefit  from  support  under  the  IPA  multi-country  and  regional 
programmes. These programmes have been also, in part, repurposed to address the response 
to  the  COVID-19  crisis.  Additionally,  Montenegro  participates  in  four  cross-border 
cooperation  programmes  with  neighbouring  Western  Balkan  countries  and  in  transnational 
cooperation  programmes  with  Member  States  under  the  European  Regional  Development 
Fund and the IPA Adriatic cross-border programme. 

124 

 
 
 
Montenegro benefitted under IPA II from participation in the following Union programmes, 
with  IPA  support:  Erasmus+,  Creative  Europe  (Culture  and  Media  strands),  Europe  for 
Citizens, ISA - Interoperability solutions for public administrations, businesses and citizens, 
Employment  and  Social  Innovation,  Horizon  2020,  Customs  2020,  Fiscalis  2020, 
Competitiveness  of  Enterprises  and  Small  and  Medium-Sized  Enterprises  Programme 
(COSME). Montenegro also participates with their own funds in the EU Justice Programme.  
The full list of programmes for IPA III has not yet been defined. 

The  Commission  set  aside  EUR  70  million  in  grants  from  IPA  II  for  the  Western  Balkan 
partners  to  obtain  COVID-19  vaccines  as  well  as  equipment  and  supplies  for  the 
implementation  of  the  vaccination  campaigns.   Montenegro  received  EUR  2.453  million  of 
these funds. A total of 573 220 doses of COVID-19 vaccines were provided to Montenegro 
through  resales  and  donations  of  EU  Member  States  and  direct  EU  funded  purchases  from 
vaccine  suppliers.  Montenegro  also  received  48  000  COVID-19  vaccines  via  the  COVAX 
initiative, which is significantly supported by the EU. 

125 

 
 
 
 
STATISTICAL DATA (as of 01.09.2022) 

Montenegro 

Basic data 

Population (thousand) 

Total area of the country (km²) 

National accounts 

Gross domestic product (GDP) (million euro) 

GDP (euro per capita) 

GDP per capita (in purchasing power standards (PPS)) 

GDP per capita (in PPS), relative to the EU average (EU-27 = 100) 

Real GDP growth rate: change on previous year of GDP volume (%) 

Employment growth (national accounts data), relative to the previous year (%) 

Labour productivity growth: growth in GDP (in volume) per person employed, relative to the 
previous year (%) 

Unit labour cost growth, relative to the previous year (%) 

**3 year change (T/T-3) in the nominal unit labour cost growth index (2015 = 100) 

Labour productivity per person employed: GDP (in PPS) per person employed relative to EU 
average (EU-27 = 100) 

Gross value added by main sectors 

Agriculture, forestry and fisheries (%) 

Industry (%) 

Construction (%) 

Services (%) 

Final consumption expenditure, as a share of GDP (%) 

Gross fixed capital formation, as a share of GDP (%) 

Changes in inventories, as a share of GDP (%) 

Exports of goods and services, relative to GDP (%) 

2020 

622 s 

: 

2020 

4 186 

6 740 

Note 

2009 

617 s 

2016 

622 s 

2017 

622 s 

2018 

622 s 

2019 

622 s 

13 812 w 

13 812 w 

13 812 w 

13 812 w 

: 

Note 

2009 

2 994 

4 840 

9 832 

40.9 

-  5.8 

: 

: 

: 

: 

: 

10.0 

14.3 

6.6 

69.2 s 

103.8 

27.3 

-  0.4 

34.3 

2016 

3 954 

6 350 

2017 

4 299 

6 910 

2018 

4 663 

7 490 

2019 

4 951 

7 960 

12 637 

13 516 

14 590 

15 696 

13 356 

44.8 

2.9 

46.1 

4.7 

48.2 

5.1 

50.1 

4.1 

44.6 

-  15.3 

: 

: 

: 

: 

: 

: 

: 

: 

: 

: 

: 

: 

: 

: 

: 

: 

: 

: 

: 

: 

9.0 

12.2 

6.7 

8.4 

11.3 

6.9 

8.2 

12.5 

7.0 

7.9 

11.9 

7.9 

72.0 s 

73.5 s 

72.4 s 

72.2 s 

96.4 

24.7 

1.4 

40.6 

93.2 

26.9 

3.3 

41.1 

91.9 

29.2 

2.7 

42.9 

89.2 

27.3 

4.7 

43.8 

: 

: 

: 

: 

: 

9.1 

13.5 

7.3 

70.0 s 

103.8 

27.9 

3.3 

26.0 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Imports of goods and services, relative to GDP (%) 

Gross fixed capital formation by the general government sector, as a percentage of GDP (%) 

Business 

Industrial production volume index (2015 = 100) 

Number of active enterprises (number) 

Note 

Birth rate: number of enterprise births in the reference period (t) divided by the number of 
enterprises active in t (%) 

Death rate: number of enterprise deaths in the reference period (t) divided by the number of 
enterprises active in t (%) 

People employed in SMEs as a share of all persons employed (within the non-financial 
business economy) (%) 

Value added by SMEs (in the non-financial business economy) (EUR million) 

Total value added (in the non-financial business economy) (EUR million) 

65.1 

: 

2009 

96.7 

: 

: 

: 

: 

: 

: 

63.1 

: 

2016 

97.0 

: 

64.5 

: 

2017 

92.9 

: 

66.7 

: 

2018 

113.7 

: 

65.0 

: 

2019 

106.7 

: 

61.0 

: 

2020 

105.6 

: 

13.1 w 

7.1 w 

11.2 w 

11.2 w 

8.5 w 

6.1 w 

5.4 w 

4.8 w 

3.3 w 

4.7 w 

: 

: 

: 

: 

: 

: 

: 

: 

: 

: 

1 530 w 

1 780 w 

2 021 w 

2 205 w 

1 819 w 

Inflation rate and house prices 

Note 

2009 

Consumer price index (CPI), change relative to the previous year (%) 

**Annual change in the deflated house price index (2015 = 100) 

: 

: 

2016 

0.1 w 

: 

2017 

2.8 w 

: 

2018 

2.9 w 

: 

2019 

0.5 w 

: 

2020 

-  0.8 w 

: 

Balance of payments 

Note 

2009 

2016 

2017 

2018 

2019 

2020 

Balance of payments: current account total (million euro) 

Balance of payments current account: trade balance (million euro) 

Balance of payments current account: net services (million euro) 

Balance of payments current account: net balance for primary income (million euro) 

Balance of payments current account: net balance for secondary income (million euro) 

Net balance for primary and secondary income: of which government transfers (million euro) 

**3 year backward moving average of the current account balance relative to GDP (%) 

**Five year change in share of world exports of goods and services (%) 

: 

: 

: 

: 

: 

: 

: 

: 

-  642.0 

-  692.0 

-  793.0 

-  707.0 

- 1 091.0 

- 1 658.0 

- 1 860.0 

- 2 050.0 

- 2 065.0 

- 1 643.0 

771.0 

34.0 

213.0 

26.0 

852.0 

89.0 

229.0 

22.0 

-  13.2 

-  14.4 

: 

: 

935.0 

55.0 

265.0 

34.0 

-  16.4 

19.2 

1 019.0 

56.0 

284.0 

49.0 

-  15.8 

27.2 

176.0 

66.0 

308.0 

51.0 

-  19.1 

-  31.2 

Net balance (inward - outward) of foreign direct investment (FDI) (million euro) 

1 066.5 w 

372.0 s 

484.0 s 

323.0 s 

345.0 s 

467.5 w 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Foreign direct investment (FDI) abroad (million euro) 

32.9 w 

-  167.0 

10.0 

of which FDI of the reporting economy in the EU-27 countries (million euro) 

: 

-  4.6 w 

-  4.6 w 

Foreign direct investment (FDI) in the reporting economy (million euro) 

1 099.4 w 

205.0 

494.0 

92.0 

78.0 

415.0 

19.0 

67.0 

1.0 

412.0 

41.0 

-  4.5 w 

-  2.0 w 

463.0 w 

90.9 w 

of which FDI of the EU-27 countries in the reporting economy (million euro) 

**Net international investment position, relative to GDP (%) 

: 

: 

-  44.0 w 

161.4 w 

-  177.4 w 

-  170.1 w 

-  168.5 w 

-  167.9 w 

-  206.2 w 

Year on year rate of change in gross inflow of remittances (in national currency) from migrant 
workers (%) 

1) 

2.1 sw 

4.8 s 

4.7 s 

4.9 s 

4.8 s 

6.3 s 

Public finance 

Note 

2009 

2016 

2017 

2018 

2019 

2020 

General government deficit / surplus, relative to GDP (%) 

-  5.7 w 

-  2.8 w 

-  5.7 w 

-  4.6 w 

-  2.0 w 

-  10.7 ew 

General government gross debt relative to GDP (%) 

Total  government revenues, as a percentage of GDP (%) 

Total government expenditure, as a percentage of GDP (%) 

38.1 w 

45.4 w 

51.1 w 

64.4 w 

42.6 w 

46.2 w 

64.2 w 

41.5 w 

46.8 w 

70.1 ew 

42.2 w 

46.2 w 

76.5 w 

43.4 w 

45.4 w 

103.1 w 

43.7 ew 

54.4 ew 

Financial indicators 

Note 

2009 

2016 

2017 

2018 

2019 

2020 

Gross external debt of the whole economy, relative to GDP (%) 

Gross external debt of the whole economy, relative to total exports (%) 

Money supply: M1 (banknotes, coins, overnight deposits, million euro) 

Money supply: M2 (M1 plus deposits with maturity up to two years, million euro) 

Money supply: M3 (M2 plus marketable instruments, million euro) 

: 

: 

: 

: 

: 

162.6 s 

160.6 s 

164.7 s 

169.0 sw 

224.1 sw 

401.0 w 

392.2 w 

381.7 w 

385.5 w 

862.2 w 

: 

: 

: 

: 

: 

: 

: 

: 

: 

: 

: 

: 

: 

: 

: 

Total credit by monetary financial institutions to residents (consolidated) (million euro) 

2) 

2 373.4 w 

2 080.6 w 

2 294.1 w 

2 528.0 w 

2 727.3 w 

2 841.0 w 

**Annual change in financial sector liabilities (%) 

**Private credit flow, consolidated, relative to GDP (%) 

**Private debt, consolidated, relative to GDP (%) 

Interest rates: day-to-day money rate, per annum (%) 

Lending interest rate (one year), per annum (%) 

Deposit interest rate (one year), per annum (%) 

Euro exchange rates: average of period (1 euro = … national currency) 

: 

: 

: 

: 

: 

: 

: 

: 

: 

: 

: 

: 

: 

: 

: 

: 

: 

: 

: 

: 

: 

: 

: 

: 

3) 

3) 

9.38 w 

3.87 w 

: 

7.45 w 

0.93 w 

1 w 

6.81 w 

0.69 w 

1 w 

6.36 w 

0.56 w 

1 w 

6.01 w 

0.40 w 

1 w 

5.84 w 

0.40 w 

: 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Trade-weighted effective exchange rate index, 42 countries (2015 = 100) 

**3 year change (T/T-3) in the trade-weighted effective exchange rate index, 42 countries 
(2015 = 100) 

: 

: 

: 

: 

: 

: 

: 

: 

: 

: 

: 

: 

Value of reserve assets (including gold) (million euro) 

397.5 w 

752.7 w 

847.1 w 

1 049.8 w 

1 366.8 w 

1 738.5 w 

External trade in goods 

Value of imports: all goods, all partners (million euro) 

Value of exports: all goods, all partners (million euro) 

Trade balance: all goods, all partners (million euro) 

Note 

2009 

1 654 

277 

2016 

2 062 

326 

2017 

2 304 

372 

2018 

2 554 

400 

2019 

2 601 

416 

2020 

2 105 

366 

- 1 377 

- 1 736 

- 1 932 

- 2 154 

- 2 185 

- 1 739 

Terms of trade (export price index / import price index * 100) (number) 

: 

98.0 sw 

103.3 sw 

100.7 sw 

99.1 sw 

102.7 sw 

Share of exports to EU-27 countries in value of total exports (%) 

Share of imports from EU-27 countries in value of total imports (%) 

50.9 s 

41.3 s 

36.6 s 

47.4 s 

33.3 s 

46.5 s 

43.1 s 

47.1 s 

37.0 s 

47.0 s 

37.7 s 

44.2 s 

Demography 

Note 

2009 

Crude rate of natural change of population (natural growth rate): number of births minus 
deaths (per thousand inhabitants) 

Infant mortality rate deaths of children under one year of age (per thousand live births) 

Life expectancy at birth: male (years) 

Life expectancy at birth: female (years) 

4.5 

5.7 

72.9 

77.5 

Labour market 

Note 

2009 

Economic activity rate for persons aged 20–64: proportion of the population aged 20–64 that 
is economically active (%) 

*Employment rate for persons aged 20–64: proportion of the population aged 20–64 that are 
in employment (%) 

Male employment rate for persons aged 20–64 (%) 

Female employment rate for persons aged 20–64 (%) 

Employment rate for persons aged 55–64: proportion of the population aged 55–64 that are 
in employment (%) 

Employment by main sectors 

: 

: 

: 

: 

: 

2016 

1.8 

3.4 

74.1 

78.9 

2016 

69.1 

57.1 

63.0 

51.3 

41.2 

2017 

1.5 

1.3 

73.9 

79.2 

2017 

69.3 

58.2 

65.2 

51.4 

43.7 

2018 

1.2 

1.7 

74.5 

79.3 

2018 

70.5 

59.8 

66.7 

52.9 

46.6 

2019 

1.0 

2.4 

74.0 

79.5 

2019 

71.8 

60.8 

67.5 

54.2 

50.1 

2020 

-  0.3 

2.8 

73.2 

78.8 

2020 

67.2 

55.2 

61.7 

48.8 

44.2 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Agriculture, forestry and fisheries (%) 

Industry (%) 

Construction (%) 

Services (%) 

: 

: 

: 

: 

People employed in the public sector as a share of total employment, persons aged 20–64 
(%) 

4) 

35.7 w 

7.8 s 

9.9 s 

7.7 s 

73.8 s 

31.2 w 

7.9 s 

9.5 s 

7.6 s 

74.1 s 

32.6 w 

8.0 s 

9.9 s 

9.0 s 

72.5 s 

31.7 w 

7.1 s 

9.5 s 

9.9 s 

73.1 s 

29.3 w 

7.5 s 

10.1 s 

8.3 s 

73.5 s 

30.5 w 

5) 6) 

46.9 w 

47.5 w 

45.7 w 

63.9 bw 

66.5 w 

65.6 w 

People employed in the private sector as a share of total employment, persons aged 20–64 
(%) 

Unemployment rate: proportion of the labour force that is unemployed (%) 

Male unemployment rate (%) 

Female unemployment rate (%) 

Youth unemployment rate: proportion of the labour force aged 15–24 that is unemployed (%) 

Long-term unemployment rate: proportion of the labour force that has been unemployed for 
12 months or more (%) 

Unemployment rate for persons (aged 25–64) having completed at most lower secondary 
education (ISCED levels 0-2) (%) 

Unemployment rate for persons (aged 25–64) having completed tertiary education (ISCED 
levels 5-8) (%) 

: 

: 

: 

: 

: 

: 

: 

Social cohesion 

Note 

2009 

Average nominal monthly wages and salaries (national currency) 

Index of real wages and salaries (index of nominal wages and salaries divided by the 
inflation index) (2016 = 100) 

GINI coefficient 

Poverty gap 

*Early leavers from education and training: proportion of the population aged 18–24 with at 
most lower secondary education who are not in further education or training (%) 

416 w 

103 w 

: 

: 

7.0 w 

Standard of living 

Note 

2009 

Number of passenger cars relative to population size (number per thousand population) 

289.9 sw 

17.8 

18.3 

17.1 

35.9 

13.4 

22.1 

11.5 

2016 

499 w 

100 w 

37 

35.6 

5.5 

2016 

297.0 

16.1 

15.4 

17.0 

31.7 

12.5 

21.7 

10.7 

2017 

510 w 

100 w 

37 

34.0 

5.4 

2017 

310.0 

15.2 

15.3 

15.1 

29.4 

11.4 

21.0 

10.0 

2018 

511 w 

98 w 

35 

35.3 

4.6 

2018 

332.0 

15.2 

14.7 

15.7 

25.2 

12.0 

26.9 

11.0 

2019 

515 w 

98 w 

34 

33.1 

5.0 

17.9 

17.5 

18.4 

36.0 

13.4 

35.2 

12.0 

2020 

524 w 

100 w 

33 

28.2 

3.6 

2019 

350.0 

2020 

337.9 sw 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Number of mobile phone subscriptions relative to population size (number per thousand 
population) 

2 496.5 w 

1 632.5 w 

1 636.7 w 

1 822.8 w 

1 849.9 w 

1 736.8 w 

Mobile broadband penetration (per 100 inhabitants) 

Fixed broadband penetration (per 100 inhabitants) 

Infrastructure 

Density of railway network (lines in operation per thousand km²) 

Length of motorways (kilometres) 

Innovation and research 

Public expenditure on education relative to GDP (%) 

*Gross domestic expenditure on R&D relative to GDP (%) 

Government budget appropriations or outlays on R&D (GBAORD), as a percentage of GDP 
(%) 

Percentage of households who have internet access at home (%) 

Environment 

*Index of greenhouse gas emissions,  CO2 equivalent (1990 = 100) 

Energy intensity of the economy (kg of oil equivalent per 1 000 euro GDP at 2015 constant 
prices) 

3.2 w 

8 w 

Note 

2009 

18.1 sw 

 z 

Note 

2009 

: 

1.12 sw 

: 

: 

Note 

2009 

58.0 w 

296.7 

8.9 w 

19 w 

2016 

18.0 s 

 z 

2016 

: 

0.32 

: 

: 

2016 

61.2 w 

263.1 

10.5 w 

22 w 

2017 

18.0 s 

 z 

2017 

: 

0.35 

: 

8.8 w 

25 w 

2018 

18.0 s 

 z 

2018 

: 

0.50 

: 

8.0 w 

29 w 

2019 

18.0 s 

 z 

2019 

: 

0.36 sw 

: 

7.7 w 

30 w 

2020 

: 

 z 

2020 

: 

: 

: 

71.0 

72.0 

74.0 

80.0 

2017 

62.9 w 

263.3 

2018 

67.1 w 

259.5 

2019 

64.7 w 

258.2 

2020 

: 

280.3 

Electricity generated from renewable sources relative to gross electricity consumption (%) 

46.6 

51.0 

50.1 

52.4 

53.6 

61.5 

Road share of inland freight transport (based on tonne-km) (%) 

7) 

64.1 w 

58.5 w 

39.0 w 

55.7 w 

45.4 w 

41.8 w 

Energy 

Note 

2009 

Primary production of all energy products (thousand TOE) 

Primary production of crude oil (thousand TOE) 

Primary production of solid fuels (thousand TOE) 

Primary production of gas (thousand TOE) 

549 

0 

211 

0 

2016 

662 

0 

317 

0 

2017 

624 

0 

335 

0 

2018 

728 

0 

362 

0 

2019 

736 

0 

396 

0 

2020 

726 

0 

400 

0 

Net imports of all energy products (thousand TOE) 

415 s 

342 s 

420 s 

334 s 

365 s 

280 s 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Gross inland energy consumption (thousand TOE) 

Gross electricity generation (GWh) 

965 

2 760 

Agriculture 

Note 

2009 

Agricultural production volume index of goods and services (at producer prices) (2010 = 100) 

: 

990 

3 141 

2016 

: 

1 037 

2 483 

2017 

: 

1 074 

3 811 

2018 

: 

1 112 

3 433 

2019 

: 

1 023 

3 381 

2020 

: 

Utilised agricultural area (thousand hectares) 

221.5 

255.9 p 

256.4 p 

256.8 p 

257.5 p 

258.0 p 

Livestock numbers: live bovine animals (thousand heads, end of period) 

Livestock numbers: live swine (thousand heads, end of period) 

Livestock numbers: live sheep and live goats (thousand heads, end of period) 

Raw milk available on farms (thousand tonnes) 

Harvested crop production: cereals (including rice) (thousand tonnes) 

Harvested crop production: sugar beet (thousand tonnes) 

Harvested crop production: vegetables (thousand tonnes) 

Source: Eurostat and the statistical authorities in Montenegro 

: = not available 

  b = break in series 

  e = estimated value 

  p = provisional 

s = Eurostat estimate 

: 

: 

: 

: 

4.3 

0.0 

30.0 

89.0 p 

55.0 p 

87.0 p 

25.0 p 

83.3 p 

23.6 p 

81.4 p 

23.0 p 

223.0 ps 

218.0 ps 

216.0 ps 

210.8 ps 

180.6 p 

181.4 p 

181.5 p 

178.0 p 

: 

: 

: 

: 

7.7 p 

0.0 

7.9 p 

0.0 

8.0 p 

0.0 

7.6 p 

0.0 

7.3 p 

0.0 

41.8 p 

41.2 p 

42.3 p 

40.1 p 

39.4 p 

  w= data supplied by and under the responsibility of the national statistical authority and published on an "as is" basis and without any assurance as regards 

their quality and adherence to EU statistical methodology 

z =  not applicable and therefore equal to 0 

* = Europe 2020 indicator 

** = Macroeconomic Imbalance Procedure (MIP) indicator 

  Footnotes: 

1)  Data are in accordance with the IMF Balance of Payments Manual, fifth edition. 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
2)  Loans include total banks' loans granted to non MFI residents and other claims (factoring and forfeiting, claims on outstanding bills of acceptance, 

guarantees and bills of exchange). 

3)  Weighted average effective interest rate, outstanding amounts, annual. 

4)  Data refer to number of employees in the public sector as a share of the total number of persons employed. 

5)  Data refer to number of employees in the private sector as a share of the total number of persons employed. Comprises data of private companies or 

enterprises, entrepreneurs, private households and NGO. 

6)  Break in series as previously only employees were answering this question; Since 2018 all employed persons are giving answer to this question. 

7)  Total freight traffic (national territory and international tnsport).