COMMISSION STAFF WORKING DOCUMENT Montenegro 2023 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 2023 Communication on EU Enlargement policy
Date: 2023-11-08
Institutions: Directorate-General for Neighbourhood and Enlargement Negotiations, European Commission
Subjects: Montenegro, accession criteria, accession negotiations, pre-accession strategy, regional cooperation

EN 

  EN 

   EUROPEAN COMMISSION  Brussels, 8.11.2023  SWD(2023) 694 final  COMMISSION STAFF WORKING DOCUMENT Montenegro 2023 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 2023 Communication on EU Enlargement policy                     {COM(2023) 690 final} - {SWD(2023) 690 final} - {SWD(2023) 691 final} - {SWD(2023) 692 final} - {SWD(2023) 693 final} - {SWD(2023) 695 final} - {SWD(2023) 696 final} - {SWD(2023) 697 final} - {SWD(2023) 698 final} - {SWD(2023) 699 final}  
 
 
Table of Contents 

1. Introduction .............................................................................................................................................. 3 

1.1. Context ............................................................................................................................................... 3 

1.2. Summary of the report ...................................................................................................................... 3 

1.3 State of play of the accession negotiations ........................................................................................ 9 

2. Cluster 1: The fundamentals of the accession process ........................................................................... 10 

2.1.Functioning of democratic institutions and public administration reform ...................................... 10 

2.1.1 Democracy ................................................................................................................................. 10 

2.1.2. Public administration reform .................................................................................................... 17 

2.2. Rule of law and fundamental rights ................................................................................................. 21 

2.2.1  Chapter 23: Judiciary and fundamental rights ........................................................................ 21 

2.2.2. Chapter 24: Justice, freedom and security ................................................................................ 52 

2.3. Economic criteria ............................................................................................................................. 68 

2.3.1. The existence of a functioning market economy ...................................................................... 69 

2.3.2. The capacity to cope with competitive pressure and market forces within the EU ................. 75 

2.4. Public procurement, statistics, financial control ............................................................................. 78 

Chapter 5: Public procurement ........................................................................................................... 79 

Chapter 18: Statistics .......................................................................................................................... 80 

Chapter 32: Financial control .............................................................................................................. 82 

3.  Good neighbourly relations and regional cooperation ....................................................................... 85 

4. Ability to assume the obligations of membership .................................................................................. 87 

Cluster 2: Internal Market ....................................................................................................................... 87 

Chapter 1: Free movement of goods .................................................................................................. 88 

Chapter 2: Freedom of movement for workers .................................................................................. 90 

Chapter 3: Right of establishment and freedom to provide services ................................................. 91 

Chapter 4: Free movement of capital ................................................................................................. 92 

Chapter 6: Company law ..................................................................................................................... 93 

Chapter 7: Intellectual property law ................................................................................................... 94 

Chapter 8: Competition policy ............................................................................................................ 96 

Chapter 9: Financial services ............................................................................................................... 98 

Chapter 28: Consumer and health protection .................................................................................... 99 

Cluster 3: Competitiveness and inclusive growth ................................................................................. 101 

Chapter 10: Digital transformation and media ................................................................................. 102 

Chapter 16: Taxation ......................................................................................................................... 104 

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Chapter 17: Economic and monetary policy ..................................................................................... 104 

Chapter 19: Social policy and employment ...................................................................................... 106 

Chapter 20: Enterprise and industrial policy .................................................................................... 108 

Chapter 25: Science and research ..................................................................................................... 110 

Chapter 26: Education and culture ................................................................................................... 111 

Chapter 29: Customs union .............................................................................................................. 113 

Cluster 4: The Green agenda and sustainable connectivity .................................................................. 115 

Chapter 14: Transport policy ............................................................................................................ 115 

Chapter 15: Energy ............................................................................................................................ 117 

Chapter 21: Trans-European networks ............................................................................................. 119 

Chapter 27: Environment and climate change ................................................................................. 120 

Cluster 5: Resources, agriculture and cohesion .................................................................................... 123 

Chapter 11: Agriculture and rural development ............................................................................... 124 

Chapter 12: Food safety, veterinary and phytosanitary policy ......................................................... 125 

Chapter 13: Fisheries and aquaculture ............................................................................................. 127 

Chapter 22: Regional policy and coordination of structural instruments ........................................ 128 

Chapter 33: Financial and budgetary provisions .............................................................................. 130 

Cluster 6: External relations .................................................................................................................. 131 

Chapter 30: External relations .......................................................................................................... 131 

Chapter 31: Foreign, security and defence policy ............................................................................ 132 

Annex I – Relations between the EU and Montenegro ........................................................................ 135 

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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  focusing  on:  fundamental  reforms,  stronger 
political steer, increased dynamism and predictability of the process.  Montenegro continued 
to  broadly  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, 
in  line  with  the  requirements  set  out  in  the  Negotiating  Framework  as  well  as  the  revised 
methodology formally accepted by Montenegro at the Intergovernmental Conference held on 
22 June 2021.  Progress  towards  meeting  the  interim  benchmarks  set  in  the  rule  of  law 
Chapters  23  and  24  will  be  key  to  achieve  further  progress  in  the  negotiations  overall.  No 
further chapters will be provisionally closed before this milestone is reached.  

The  political  commitment  of  the  Montenegrin  authorities  to  the  strategic  goal  of  European 
integration has been consistently stated as the key priority for the country. However, progress 
on EU accession reforms has largely stalled as Montenegro suffered from deep  polarisation 
and  political  instability.  The  country  was  ruled  by  a  caretaker  government  and  while 
Parliament  was  unable  to  assemble  a  consistent  majority.  The  absence  of  a  functional 
Constitutional Court created uncertainties and legal discrepancies, including on the electoral 
processes.  The  presidential  election  run-off  and  parliamentary  elections  took  place  in  April 
and June respectively. The constitution of the new parliament and the new government took 
place at the end of October 2023. Local elections took place in 14 municipalities. 

The EU continued to  provide essential and unparalleled technical  and  financial support.  To 
address  the  energy  crisis  provoked  by  Russia’s  war  of  aggression  against  Ukraine, 
Montenegro  and  the  Commission  prepared  an  Energy  Support  Package,  consisting  of  a 
focused national energy action plan and an immediate budget support programme providing 
EUR 30  million  of  grant  financing  to  Montenegro.  The  EU  also  made  available  EUR 500 
million  to  the  region  under  the  Western  Balkans  Investment  Framework  to  respond  to  the 
crisis in the medium term.  
1.2.   SUMMARY OF THE REPORT1 

Concerning political criteria, the reporting period was marked by tense and confrontational 
positions leading to a blockage of the political system.  

The  political  situation  was  dominated  by  a  caretaker  government  that  did  not  have  the 
confidence  of  the  Parliament  and  a  Parliament  unable  to  assemble  a  clear  and  consistent 

1  This  report  covers  the  period  from  June  2022  to  June  2023.  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 in the area of rule 
of law.  
For  the  state  of  play  the  report  uses  the  following  assessment  scales:  early  stage,  some  level  of  preparation, 
moderately  prepared,  good  level  of  preparation  and  well  advanced.  For  progress  made  during  the  reporting 
period,  the  following  scale  has  been  used:  backsliding,  no  progress,  limited  progress,  some  progress,  good 
progress and very good progress. Where appropriate, also interim steps have been used. 

3 

 
 
 
 
majority to take forward reforms. Moreover, the boycott by large sections of the Parliament 
affected its work.   

There  was  no  effective  political  dialogue  and  constructive  engagement  by  political  parties 
with a view to enhancing parliamentary accountability and government oversight. There was 
a  lack  of  direction  on  EU  accession  issues,  in  particular  following  the  resignation  of  the 
Minister of EU Affairs. On several occasions, the Government and/or the Parliament chose to 
ignore recommendations of the European Commission and/or the Venice Commission. 

Adoption of the Act on Parliament that would regulate relations between the Parliament and 
the executive is pending.  

Local  elections  in  14  municipalities  (October  2022),  presidential  elections  (March/April 
2023)  and  parliamentary  elections  (June  2023)  took  place.  The  constitution  of  the  new 
parliament  and  the  new  government  took  place  at  the  end  of  October  2023.   Election 
observation  missions  of  the  Office  for  Democratic  Institutions  and  Human  Rights  of  the 
Organization  for  Security  and  Co-operation  in  Europe  monitored  the  presidential  and 
parliamentary elections. These missions assessed both elections as peaceful and competitive 
despite  some  procedural  shortcomings.  The  mandate  of  the  Parliamentary  Committee  for  a 
comprehensive  electoral  reform  expired  in  July  2022  with  no  tangible  results.  The  legal 
framework requires a comprehensive reform and harmonisation of election legislation, voting 
and  candidacy  rights,  transparency,  mechanisms  of  dispute  resolution,  and  oversight  of 
campaign  finance  and  media.  These,  along  with  other  issues,  remain  unaddressed.  The 
absence  of  a  functional  Constitutional  Court  between  September  2022  and  February  2023 
seriously affected electoral processes. 
As regards governance, the government has carried out its duties in a caretaker capacity since 
August  2022  and  with  limited  accountability,  due  to  the  inability  of  the  political  system  to 
form a new government or proceed to early elections. Against the background of unclear rules 
governing  the  competences  of  a  caretaker  government,  the  government  continued  to  adopt 
important decisions, and to dismiss and appoint key officials. Key positions continued to be 
filled on an acting basis. The lack of ministerial coordination remains a cause for concern. In 
February  2023,  the  caretaker  government  adopted  its  Annual  Work  Programme  for  2023. 
Overall,  transparency  of  governance  remained  an  issue  and  the  government  frequently 
resorted  to  the  procedural  option  of  adopting  decisions  without  formally  holding  a 
government  session.  Both  Presidents  in  function  during  the  reporting  period  refused  to  sign 
legislation adopted following the dissolution of the Parliament.  

The  role  of  civil  society  is  recognised  and  promoted.  However,  the  legal  and  institutional 
framework  regulating  cooperation  between  state  institutions  and  civil  society  needs  to  be 
improved. Politicians – including at the highest level – frequently denigrated the work of civil 
society organisations and isolated cases of verbal attacks were reported. The Council for Co-
operation of State Bodies and Non-Governmental Organisations has not resumed its work.  

Montenegro  is  moderately  prepared  in  the  area  of  public  administration  reform.  Overall, 
limited  progress  was  made.  A  new  public  finance  management  reform  programme  was 
adopted  and  its  implementation  was  started.  By  contrast,  no  changes  were  made  to 
amendments to the civil service legislation that introduced relaxed qualification requirements 
and ample discretion for appointing authorities to dismiss heads of administrative bodies. The 
Parliament adopted amendments to the Law on local self-government to harmonise it with the 
Law  on  civil  service,  disregarding  the  Commission’s  recommendation.  The  relaxed 
requirements are a source of continuing concern for merit-based recruitment, competence and 
independence  of  civil  servants.  Continued  staff  changes  in  the  public  administration  led  to 
further  loss  of  know-how  on  matters  related  to  the  EU  accession  process  and  an  overall 
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slowing of the pace of reforms. The Parliament has yet to adopt amendments to the Law on 
access to information. Effective lines of accountability within the administration are still to be 
set up. 

Montenegro remains moderately prepared to apply the EU acquis and European standards in 
the area of judiciary and fundamental rights but made limited progress overall. No progress 
was  achieved  in  justice  reform,  the  most  challenging  area  of  the  rule  of  law  to  date.  The 
judicial system continued to face a deep institutional crisis, resulting in  weak leadership and 
management,  lack  of  strategic  vision  and  poor  planning,  affecting  the  country’s  ability  to 
deliver  justice.  In  addition,  the  system  remains  affected  by  issues  of  accountability,  among 
other weaknesses. Montenegro continues to meet its obligations on fundamental rights under 
international human rights instruments and legislation. The Law on the Judicial Council and 
judges and the Law on State Prosecution Service remain to be amended in line with the EU 
acquis  and  European  standards.  Full  and  effective  protection  of  journalists  and  other  media 
workers  continues  to  improve,  yet  tangible  results  on  old  cases  of  attacks  have  yet  to  be 
achieved. 

Montenegro has achieved some level of preparation in the fight against corruption. Limited 
progress  was  achieved.  Corruption,  including  high-level  corruption,  remains  an  issue  of 
concern  and  is  prevalent  in  many  areas,  including  in  state  structures.  Montenegro  has  not 
sufficiently  upgraded  its  legislative  and  strategic  framework  for  the  prevention  of  and  fight 
against corruption in line with the EU acquis, European and international standards. Several 
high-profile  cases  of  corruption  are  under  investigation.  Montenegro  still  needs  to 
demonstrate  a  stringent  and  unambiguous  criminal  justice  response  to  this  critical 
phenomenon.  Limited  progress  was  achieved  in  preventing  corruption.  The  results  of  the 
Anti-Corruption  Agency  improved  in  quantitative  terms.  However,  its  independence, 
accountability,  impartiality,  and  proactiveness  should  be  further  ensured.  The  Law  on 
prevention of corruption should be improved.  

As  regards  the  fight  against  organised  crime  and  high-level  corruption,  the  Special 
Prosecution  Office  acted  with  alacrity  in  launching  several  high-profile  investigations,  that 
appear to point to a deep infiltration of corruption and organised crime into state structures, 
including  at  the  top  level  of  the  judiciary  and  law  enforcement.  The  justice  system  of 
Montenegro  needs  to  demonstrate  a  strong,  stringent,  coherent  and  unambiguous  response. 
Montenegro  must  further  improve  the  track  record  of  investigations,  prosecutions,  final 
verdicts and asset confiscation in the fight against organised crime and high-level corruption. 
A  more  deterrent  and  effective  criminal  sanctioning  policy  and  criminal  justice  response 
needs to be enforced to avoid the perception of impunity. The effective and systematic use of 
financial  investigations  and  asset  seizure  and  confiscation  needs  to  be  improved.  Efforts  in 
this policy area should primarily target those sectors that are most vulnerable to corruption. 

In  the  area  of  fundamental  rights,  the  legislative  and  institutional  framework  is  largely  in 
place and Montenegro continues to largely meet its international obligations on human rights. 
However,  additional  efforts  are  needed  to  fully  implement  this  framework.  Changes  to  the 
existing  legislation  are  also  needed,  in  particular  in  the  area  of  non-discrimination.  The 
reporting  period  continued  to  be  marked  by  polarisation  and  division.  The  most  vulnerable 
groups  in  society  (including  Roma2  and  Egyptians,  persons  with  disabilities,  LGBTIQ 
persons) continued to be subjected to discrimination, hate speech and hate crime. The trend of 

2 In line with the terminology of European institutions the umbrella term ‘Roma’ is used here to refer to a 
number of different groups, without denying the specificities of these groups. 

5 

 
 
 
increase in the number of femicides with insufficient follow-up by the authorities and cases of 
publicly expressed misogyny, gender-based violence and violence against children remains an 
issue  of  serious  concern.  Additional  efforts  need  to  be  made  to  ensure  effective 
implementation  of  legislation,  access  to  justice,  and  enforcement  of  rights  in  administrative 
and  judicial  proceedings,  in  particular  for  vulnerable  groups.  Montenegro  must  step  up  its 
efforts to conduct efficient, effective and independent investigations to address police torture, 
violations, and illegal use of coercive measures. 

Montenegro has a pluralistic and diverse media landscape and has some level of preparation 
in the area of freedom of expression. Overall, limited progress was achieved. In general, the 
authorities provided prompt and effective law-enforcement and institutional responses to new 
cases  of  violence  against  journalists.  However,  there  was  no  effective  judicial  follow-up  of 
old  cases.  The  government  involved  civil  society  and  media  stakeholders  in  the  drafting  of 
new media legislation but failed to finalise the legislative proposals  and present them to the 
Parliament.  The  authorities  need  to  step  up  efforts  to  effectively  address  the  pending 
recommendations  of  the  ad  hoc  commission  for  monitoring  violence  against  the  media, 
particularly  regarding  important  old  cases.  The  RTCG,  the  national  public  broadcaster, 
continued to produce politically balanced content, including during election periods. Further 
sustained  efforts  are  needed  to  meet  the  highest  standards  of  media  integrity  and 
accountability,  counter  disinformation,  and  limit  the  effects  of  online  harassment  and  hate 
speech. The media environment remains highly politically polarised, with uneven application 
of  the  journalistic  Code  of  Ethics  and  professional  standards.  Credible  and  effective  self-
regulation mechanisms need to be set up to strengthen media integrity and professionalism.  

On the economic criteria, Montenegro has made limited progress and is moderately prepared 
in developing a functioning market economy. The economic expansion continued at a robust 
pace  in  2022,  supported  by  private  consumption  and  strong  growth  in  tourism.  Headwinds 
came from inflationary pressures on the back of higher global commodity prices. The current 
account  deficit  increased  as  both  exports  and  imports  expanded  rapidly.  An  expansionary 
fiscal  policy  fuelled  domestic  demand  and  contributed  to  very  high  net  wage  growth.  The 
budget deficit increased significantly and a comprehensive medium-term consolidation plan to 
address  mounting  fiscal  challenges  has  not  been  developed.  The  labour  market  situation 
improved,  but  structural  problems  persist,  including  large  regional  disparities  and  gender 
gaps, informality and high youth and long-term unemployment. The banking sector remained 
well capitalised and liquid. The number of new businesses increased, but efforts to improve 
the business environment and the governance of state-owned enterprises slowed down due to 
political uncertainty.  

Montenegro has made some progress  and is moderately prepared to cope with competitive 
pressure  and  market  forces  within  the  EU.  The  education  system  faces  numerous 
challenges,  as  shown  by  the  results  of  international  tests.  Although  public  financing  for 
research  and  development  remains  modest,  some  progress  was  made  in  attracting  private 
investors.  Efforts  to  advance  a  green  and  digital  transition  have  continued,  but  large 
infrastructure gaps persist, as the administrative and financial capacity to identify, prioritise 
and implement major public investments remains limited, hampering the use of EU support. 
Despite some progress in the metallurgy sector and the good performance of tourism, efforts 
are  needed  to  diversify  Montenegro’s  narrow  production  base.  The  low  value  added  of 
domestic products, the small size of local companies, and their low level of participation in 
exports represent obstacles to increasing the productivity and competitiveness of local firms. 

Montenegro made progress on statistical methodology and transmission of data to Eurostat 
and the strategic framework for financial control. Montenegro should now focus on aligning 

6 

 
 
its statistics with the European System of Accounts and strengthening budget inspection and 
managerial accountability in public administration. Montenegro is moderately prepared / has 
a good level of preparation in the area of public procurement. In 2022, some progress was 
achieved  in  aligning  with  the  EU  acquis  and  in  further  improving  the  functioning  of  the 
electronic procurement system. In the coming year, Montenegro should focus on the effective 
implementation of legislation on public procurement and public-private partnership. It should 
also fully comply with EU public procurement rules in all cases, such as when awarding the 
concession to operate airports. 

Regarding  good  neighbourly  relations  and  regional  cooperation,  Montenegro  remained 
committed  to  promoting  good  bilateral  relations  with  other  enlargement  countries  and 
neighbouring  EU  Member  States.  Montenegro  is  generally  an  active  participant  in  regional 
cooperation.  

Concerning  Montenegro's  ability  to  assume  the  obligations  of  membership,  important 
work  on  alignment  and  preparation  for  the  implementation  of  the  EU  acquis  took  place  in 
many areas, albeit at a much slower pace than anticipated. 

The internal market cluster is key for Montenegro’s preparations to meet the requirements 
of the EU’s internal market and is of high relevance for possible early integration measures 
and  the  development  of  the  Common  Regional  Market.  Progress  was  achieved  on  market 
surveillance, accreditation and standardisation;  intellectual property rights and the adoption 
of  a  new  national  comprehensive  strategy  on  intellectual  property;  State  aid  transparency; 
banking; and consumer and health protection. Montenegro should now focus  on aligning its 
legislation  with  the  EU  acquis  on  standardisation;  strengthening  the  Employment  Agency; 
continuing  to  alignment  with  the  EU  Services  Directive;  enforcing  the  new  postal  market 
rules;  stepping  up  progress  on  developing  qualifications  for  regulated  professions; 
accelerating progress  on electronic company registration, capital  movements and payments, 
including on the acquisition of property rights; adopting a new company law and a corporate 
accounting  law;  further  aligning  its  legislation  with  the  EU  acquis  on  intellectual  property; 
adopting the roadmap concerning the closing benchmarks in the area of competition and State 
aid  and  further  progress  on  State  aid  cases  including  complex  ones;  ensuring  consumer 
protection and health protection; and implementing the laws aligning its legislation with the 
EU acquis in the insurance and capital markets sector.  

The  competitiveness  and  inclusive  growth  cluster  has  significant  links  to  Montenegro’s 
Economic  Reform  Programme.  Progress  was  made  on  tobacco  control,  pensions,  industrial 
policy, the operationalisation of the  Innovation  Fund, taxation,  and trade facilitation. In the 
area of economic and monetary policy, work to implement the action plan for alignment with 
the  EU  acquis  is  ongoing.  Montenegro  should  now  focus  on  independence  of  the  media 
sector  and  adoption  of  laws  on  audiovisual  media;  alignment  with  the  EU  acquis  on  value 
added tax; coordination of work on economic and monetary issues; labour law and the anti-
discrimination  law,  safety  at  work;  assessing  industrial  policy  and  drafting  a  new  policy, 
research  and 
implementing  EU-compatible 
computerised transit system. 

innovation,  education  and 

training  and 

The  green  agenda  and  sustainable  connectivity  cluster  has  significant  links  to 
Montenegro’s  Economic  Reform  Programme,  the  Commission’s  Economic  and  Investment 
Plan and the Green Agenda for the Western Balkans. Progress was made in creating a day-
ahead  energy  market  and  on  port  state  control,  but  progress  was  limited  concerning 
environment  and  climate  change.  Montenegro  should  now  focus  on  the  strategy  for  green 
transition  in  the  energy  sector,  including  just  transition  plans  for  a  phase-out  of  the  power 
plant in Pljevlja; adoption and implementation of the railway law; revision of the Transport 
7 

 
 
Development Strategy and significantly stepping up efforts on waste management, water and 
air quality, nature protection and climate change, including by adopting the National Energy 
and Climate Plan without further delay. 

The resources, agriculture and cohesion cluster comprises policies linked to EU Structural 
funds and Investment funds and developing the capacities to assume the responsibilities of a 
future EU Member State. Progress was made in the area of agriculture and rural development 
through the adoption of a new Strategy, food and fisheries and acquaculture, regional policy 
and structural instruments, financial and budgetary provisions. Montenegro should now focus 
on starting the implementation of the IPARD III programme, accelerate legislative alignment 
in the area of agriculture and rural development as well as fisheries and aquaculture, upgrade 
food-establishments and food safety controls whilst continuing vaccination plans for rabies as 
needed; EU cohesion policy requirements building capacity for the handling of Instrument for 
Pre-accession  Assistance  programmes  under 
rules  of 
administration for the own resources system.  

indirect  management;  and 

In the external relations cluster, Montenegro continued to fully align with all EU common 
foreign and security policy (CFSP) positions, declarations and  common positions, including 
sanctions.  It  also  continued  to  implement  measures  under  the  Common  Regional  Market 
based  on  EU  rules,  including  by  cooperating  under  the  Central  European  Free  Trade 
Agreement (CEFTA) and the Regional Cooperation Council.  

Strengthening  the  administrative  capacity  to  apply  the  EU  acquis  remains  an  important 
challenge  for Montenegro, including  the urgent  need to  re-stabilise a  functional  negotiating 
structure.  

In  the  area  of  migration,  legal  labour  migration  to  Montenegro  continued  to  increase.  In 
2022,  29 319  temporary  residence  and  work  permits  were  issued,  mainly  for  seasonal 
workers.  In  2022,  8 519  migrants  were  registered  who  had  crossed  the  border  illegally,  a 
twofold  increase  compared  with  2021,  reflecting  regional  trends.  A  total  of  8 320  people 
registered an intention to request asylum, but only 175 actually lodged an asylum request and 
9 persons were granted  an international  protection status.  Montenegro continues to  host  the 
highest number of Ukrainian nationals in the Western Balkans, both in absolute figures and 
proportionally to its population (1%). The EU-Montenegro readmission agreement with EU 
Member States continued to be implemented satisfactorily. Montenegro and the EU signed a 
new  status  agreement  in  May  2023,  enabling  European  Border  and  Coast  Guard  Agency 
(Frontex) deployments anywhere on the territory of Montenegro. Steps were taken to further 
align Montenegro’s visa policy with the one of the EU, although further efforts are needed in 
this  regard.  Montenegro  must  continue  its  efforts  to  cope  with  migratory  pressure,  by 
developing  its  international  cooperation  on  readmission,  raising  its  capacity  to  prosecute 
migrant  smuggling  networks;  and  setting  up  a  modern  migrant  data  collection  system.  The 
economic citizenship scheme was. The investor citizenship scheme was phased out at the end 
of 2022.  

8 

 
 
 
 
1.3 STATE OF PLAY OF THE ACCESSION NEGOTIATIONS  

CLUSTERS 

Chapters / areas  

Fundamentals 

All chapters open 

Internal Market 

All chapters open 

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 

All chapters open  

External Relations 
Both chapters open 
ch.30 provisionally 
closed  

23-Judiciary and fundamental rights  
24-Justice, freedom, security  
  5-Public Procurement  
18-Statistics  
32-Financial control 
…Economic Criteria 
…Functioning of democratic Institutions  
…PAR 
 1-Free movement of goods   
 2-Freedom of movement for workers   
 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 
10-Information society and media  
16-Taxation 
17-Economic and monetary policy 
19-Social policy and employment  
20-Enterprise and industrial policy  
25-Science and research 

26-Education and culture 

29-Customs union  
14- Transport policy 
15- Energy 
21-Trans-European Networks 
27-Environment and climate change  
11-Agriculture and rural development  
12-Food safety, veterinary, 
phytosanitary services 
13- Fisheries and acquaculture 
22-Regional policy and coordination of  
      structural instruments  
33-Financial and budgetary provisions  
30-External relations  
31- Foreign, security & defence policy  

Date chapter opened / closed with 
interim or closing benchmarks   
December 2013  
December 2013  
December 2013  
December 2014 
June 2014  

- 
- 
June 2017  
December 2017  
December 2017  
… 
June 2014  
December 2013  
March 2014  
June 2020  
June 2015  
December 2014   
March 2014  
March 2015  
June 2018  
December 2016  
December 2013  
December 2012 (opened and closed - 
no closing benchmarks);  
April 2013  (opened and closed – no 
closing benchmarks) 
December 2014   
December 2015  
December 2015  
June 2015  
December 2018  
December 2016  

June 2016  
June 2016  

June 2017  
December 2014  
March 2015 – June 2017 provisionally 
closed 
June 2014   

9 

 
 
 
 
 
 
 
  
  
 
 
 
 
 
2. CLUSTER 1: THE FUNDAMENTALS OF THE ACCESSION PROCESS 

2.1. FUNCTIONING OF DEMOCRATIC INSTITUTIONS AND PUBLIC ADMINISTRATION REFORM 

2.1.1 Democracy 

Montenegro  suffered  from  deep  polarisation  and  division,  which  was  manifested  in  tense 
confrontational  positions  between  politicians  unwilling  to  end  the  political  stalemate,  being 
even prepared to  escalate the constitutional  crisis  to  achieve short-term  partisan gains.  This 
led to a blockage of the political system. The political situation was dominated by a caretaker 
government lacking the necessary political legitimacy and a Parliament unable to assemble a 
consistent majority to take forward reforms. The absence of a functional Constitutional Court 
led to uncertainty and legal discrepancy. Presidential and Parliamentary elections took place, 
as well as local elections in 14 municipalities. Election observation mission of the Office for 
Democratic Institutions and Human Rights of the Organization for Security and Co-operation 
in  Europe  (OSCE/ODIHR)  monitored  the  Presidential  and  Parliamentary  elections  These 
missions  assessed  both  elections  as  peaceful  and  competitive  despite  procedural 
shortcomings.  The  mandate  of  the  Parliamentary  Committee  for  a  comprehensive  electoral 
reform produced no tangible results. The boycott by large sections of the Parliament further 
affected its work.   

Elections  

Local  elections  in  14  municipalities  (October  2022),  presidential  (March/April  2023)  and 
parliamentary elections (June 2023) took place. OSCE/ODIHR election observation missions 
monitored  the  presidential  and  parliamentary  elections  and  assessed  both  as  peaceful  and 
competitive  despite  some  procedural  shortcomings.  The  mandate  of  the  Parliamentary 
Committee for a comprehensive electoral reform expired in July 2022 with no tangible results. 
The  legal  framework  still  requires  a  comprehensive  reform  and  harmonisation  of  election 
legislation,  voting  and  candidacy  rights  restrictions,  transparency,  mechanisms  of  dispute 
resolution,  and  oversight  of  campaign  finance  and  media.  These,  along  with  other  issues, 
remain  unaddressed.  The  absence  of  a  functional  Constitutional  Court  affected  electoral 
processes. The constitution of the new parliament and the new government took place at the 
end of October 2023.  

The  mandate  of  the  Parliamentary  Committee  for  a  comprehensive  electoral  reform  expired 
on  31 July 2022.  No  progress  was  made  in  following  up  on  pending  OSCE/ODIHR 
recommendations  and  crucial  issues  concerning  electoral  legislative  reform,  voter  registry, 
financing  of  political  entities  and  electoral  campaigns,  residence  registers,  code  of  election 
campaign  ethics,  and  proposals  to  strengthen  the  professionalism  and  transparency  of  the 
work of the State Election Commission (SEC) and the Anti-Corruption Agency (ACA).  

In the absence of overall  reform,  the SEC  carried out  improvements in  areas within its sole 
competence,  and  increased  the  overall  transparency  of  its  work.  However,  the  SEC’s 
politicisation prevents it from performing its role as independent election administration body. 
In particular in the run-up to the first round of the presidential elections, the SEC took legally 
questionable decisions led by its politically appointed members. 

On 23 October 2022, local elections took place in 14 municipalities. The Constitutional Court 
(CC) was without a quorum during most of the local election process; as a result, the full and 
effective  legal  protection  of  voting  rights  was  not  guaranteed.  The  final  election  results  in 
some  municipalities  (Plav,  Podgorica  and  Pljevlja)  could  only  be  published  in  March  2023, 
after  the  CC  dismissed  all  pending  complaints.  Two  municipalities  (Budva  and  Kolasin) 
published final election results with appeals still pending at the CC.   

10 

 
 
The  elections  in  the  municipality  of  Savnik  are  not  yet  completed.as  Municipal  Election 
Committee  (MEC)  members  cannot  agree  on  the  continuation  of  the  elections  at  a  polling 
station. The Basic State Prosecutor's Office in Pljevlja formed 30 cases against 38 persons on 
election disruption charges. After investigation, the Prosecutor's Office submitted indictments 
against  30  persons  to  the  competent  court.  The  Pljevlja  Prosecutor's  Office  started  initial 
investigations  against  37  persons  for  the  criminal  offense  of  certifying  false  statements.  n 
5 March 2023,  local  elections  took  place  in  the  municipality  of  Tuzi  without  major 
irregularities. 

On  20 June 2023,  the  Ombudsman  of  Montenegro  issued  a  statement  supporting  the 
complaint of the Union of the Blind that most MECs did not guarantee an equal, secret and 
dignified  voting  process  for  persons  with  disabilities,  even  though  in  March  2022,  the  SEC 
had revised relevant by-laws and instructed all MECs accordingly. 

Presidential  elections  took  place  in  two  rounds,  on  19 March 2023  and  2 April 2023.  In  the 
run-up  to  the  first  round,  SEC  rejected  the  nomination  of  one  presidential  candidate,  citing 
contradictory information on his citizenship and permanent residence, following a procedure 
not  provided  for  by  the  law.  The  concerned  candidate  filed  a  lawsuit  against  the  SEC  for 
violation  of  his  voting  rights  and  discriminatory  treatment.  In  April  2023,  the  Agency  for 
Personal  Data  Protection  and  Free  Access  to  Information  decided  that  the  SEC  had  acted 
against its mandate and ordered it to destroy all documents relevant to the case in point that it 
had received from the Serbian SEC. The sequence of these events led to inconsistent practice 
by the SEC in relation to presidential and parliamentary elections. Overall, the SEC ensured 
transparency,  but  it  did  not  permit  observers  to  verify  signatures,  claiming  personal  data 
protection. During the electoral period, only one SEC session was broadcast live.  

The CC dismissed seven complaints filed before the first round of the presidential election as 
inadmissible  and  rejected  four.  The  Basic  State  Prosecutor’s  Office  in  Podgorica  is 
investigating  criminal  complaints  made  by  dozens  of  citizens  stating  that their  signatures  in 
support of presidential  candidates were forged.  There were no complaints  after the first and 
second rounds of voting. 

The Serbian Orthodox Church in Montenegro publicly called on its followers to vote for one 
political  side.  A  key  civil  society  election  observer,  the  non-governmental  organisation 
(NGO) Centre for Monitoring and Research (CEMI), received death threats.  Several  polling 
stations  were  not  accessible  for  persons  with  disabilities.  Women  were  underrepresented  in 
the election administration. 

The OSCE/ODIHR deployed an international election observation mission, (IEOM) including 
observers embedded from the Parliamentary Assembly of the Council of Europe (PACE) and 
from  the  European  Parliament.  For  the  second  round,  the  OSCE/ODIHR  did  not  send  any 
short-term observers. Two local NGOs deployed observes in nearly all polling stations across 
the country.  

According  to  the  OSCE/ODIHR’s  preliminary  conclusions,  both  rounds  were  peaceful  and 
competitive  and  respected  freedoms  of  assembly  and  expression.  However,  most  long-
standing OSCE/ODIHR recommendations related to the need for comprehensive reform and 
harmonisation  of  election  legislation,  voting  and  candidacy  rights  restrictions,  transparency, 
mechanisms  of  dispute  resolution,  and  oversight  of  political  party  campaign  finance  and 
media remain valid. 

The legal framework lacks sufficient regulation, for example on the grounds for annulment of 
election results by the court, the procedures for the tabulation of results, and the second round 
of  the  presidential  election.  The  SEC  implemented  provisional  solutions,  addressing 
11 

 
 
legislative  gaps,  and  overall,  the  process  was  appropriately  managed.  The  media  landscape 
was  polarised  along  political  lines  and  media  outlets  remained  highly  vulnerable  to  internal 
and external influence from corporate and political interests. 

On  17 March 2023,  one  day  after  having  dissolved  the  Parliament,  President  Dukanović 
called  early  parliamentary  elections  for  11 June 2023.  On  27  June  2023,  the  Constitutional 
Court  unanimously  repealed  the  amendments  to  the  Law  on  the  President  from  December 
2022, which had been the precondition for dissolving the Parliament. The Ministry of Interior 
published the voter register of 543 599 citizens with a delay. 

The parliamentary elections of June 2023 were competitive and well run, despite taking place 
against the background of a protracted institutional and constitutional crisis. The formation of 
a new government took place on 31 October 2023. It is important that the new government is 
able and committed to taking forward EU-related reforms. 

The  OSCE/ODIHR  observation  mission  of  the  parliamentary  elections  took  place  in  similar 
circumstances as the mission to observe the presidential elections. Two local NGOs deployed 
observers  to  most  polling  stations  across  the  country.  For  the  first  time,  observers  for  the 
Union of the Blind systematically monitored the accessibility and voting material for persons 
with  disability  at  505  polling  stations.  Its  findings  were  that  most  MECs  did  not  provide 
appropriate  accessibility  for  persons  with  disability.  The  preliminary  conclusions  of  the 
international  election  observation  mission  were  similar  to  those  published  after  the 
presidential elections.  

Two political parties submitted several complaints to various MECs on discrepancies between 
the number of people who exercised their right to vote, the number of ballots, and the number 
of  control  coupons.  The  Kolasin  and  Cetinje  MECs  decided  to  repeat  the  elections  in  one 
polling station each. The SEC annulled the decision of the MEC Kolasin. On 8 July 2023, the 
elections were repeated in Cetinje. 

SEC  declared  the  final  results  of  the  parliamentary  elections  on  14  July,  which  is  not  in 
accordance  with  the  legal  deadline  for  announcing  election  results,  (15  days  after  the 
elections).  

The inclusion of women in political life remains low. In the new Parliament there will be only 
17  women,  (21%),  the  lowest  percentage  since  the  introduction  of  the  quota  system,  under 
which  one  fourth  of  the  electoral  ticket  must  be  reserved  for  representatives  of  the 
underrepresented gender.  

There are no new developments in the political and judicial follow-up to the alleged misuse of 
public funds for party political purposes in the 2012 ‘audio recordings affair’  Regarding the 
alleged  electoral  fraud  case  “the  ‘envelope  affair”  in  2016,  in  August  2023  the  High  Court 
confirmed the indictment against former Podgorica Mayor Stijepovic.  

Parliament 

The  political  situation  was  dominated  by  a  caretaker  government  lacking  the  necessary 
political  legitimacy  and  a  Parliament  unable  to  assemble  a  clear  and  consistent  majority  to 
take  forward  reforms.  Moreover,  the  boycott  by  large  sections  of  the  Parliament  further 
affected  its  work.  The  overall  accountability  of  the  political  system  was  undermined  by  the 
shortcomings  of  the  Montenegrin  Constitution,  which  lacks  clarity  and  presents  loopholes, 
and  by  the  lack  of  a  legislative  framework  regulating  the  competences  of  a  caretaker 
government  or  a  dismissed  Parliament.  This  added  to  an  overall  sense  of  political  and 
institutional unpredictability.   

12 

 
 
There was no effective political dialogue and constructive engagement by political parties to 
enhancing  parliamentary  accountability  and  government  oversight.  There  was  a  lack  of 
activity on EU accession issues, in particular following the resignation of the Minister of EU 
Affairs.  Furthermore,  on  various  occasions,  the  Parliament  adopted  legislation  that 
contradicted recommendations of the European Commission and/or the Venice Commission. 
The Parliament continued to strengthen its transparency by establishing some citizen-oriented 
services. 

Adoption of the Act on Parliament that would regulate relations between the Parliament and 
the executive is pending.  

Since the government of Prime Minister (PM) Abazović had  a no-confidence vote in August 
2022,  the  Parliament  has  been  unable  to  reach  the  necessary  majority  to  appoint  a  new  PM 
and government. Despite this, and even following the Parliament’s dissolution in March 2023 
and  the  announcement  of  early  parliamentary  elections,  the  Parliament  continued  operating, 
adopting legislation and taking occasional decisions, as if the government was not acting in a 
caretaker capacity. Since the autumn of 2022, Members of Parliament (MPs) from DPS and 
its  partners  have  boycotted  most  plenary  sessions.  Presidents  Dukanović  and  Milatović 
refused to sign the laws that the Parliament adopted after its dissolution.  

Upon completion of consultations on the formation of a new government in September 2022, 
President  Dukanović  proposed  that  the  Parliament  be  dissolved,  but  on  30 September 2022, 
the  Parliament  refused  to  act  in  accordance  with  this  request.  Instead,  with  the  publicly 
declared purpose of facilitating the formation of a new government in November, an ad hoc 
majority composed of three political blocks adopted amendments to the Law on the President 
that circumvent the applicable constitutional provisions on the prerogatives of the President. 
According to the amendments, within 30 days from the date of a no-confidence vote, and after 
conducting  political  consultations,  the  President  is  ‘obliged  to  propose  as  PM-designate  the 
candidate who has the support of the majority of the total  number of MPs’ or the candidate 
with  ‘dominant  parliamentary  support’.  If  the  President  does  not  comply,  the  Parliament  is 
given the authority to nominate a PM-designate by simple majority. Using his constitutional 
prerogatives, President Dukanović returned the Law to the Parliament for review. 

In November 2022, President Dukanović referred the amendments to the Council of Europe’s 
Venice  Commission  for an  urgent  opinion.  The Venice  Commission  assessed  that  a  smaller 
parliamentary  majority  than  prescribed  for  constitutional  revisions  should  not  have  adopted 
these  amendments.  Nevertheless,  in  December  2022,  the  same  majority  adopted  the 
amendments again, and gave the mandate to MP Lekic to form a new government. However, 
the same political blocks failed to find an agreement on the formation of the new government. 
Due to controversies over the amended law, which the opposition considered unconstitutional, 
the opposition boycotted most sessions from October 2022 until April 2023. In June 2023, the 
Constitutional  Court  unanimously  repealed  the  controversial  amendments  to  the  Law  on 
President. 

The  Parliament  held  20  sittings  (10  sittings  during  ordinary  sessions  and  10  sittings  during 
extraordinary  sessions).  It  adopted  133  acts  (75  laws,  56  decisions  and  two  resolutions).  In 
December 2022, the Parliament adopted the 2023 Budget Law.  

Following the June parliamentary elections, on 27 July 2023 the new Parliament held its first 
session  and  verified  the  mandates  of  the  new  MPs.  The  new  Parliament  speaker  was  voted 
into position on 30 October 2023.  

As regards the Parliament’s legislative role, due to the boycott, most laws were adopted by 
simple  majority  (41)  with  most  opposition  MPs  not  participating  in  the  discussion.  The 
13 

 
 
Parliament repeatedly sought to make changes to systemic laws via administrative procedures 
and  without  broader  consultations.  On  various  occasions,  the  Parliament  adopted  legislation 
that  contradicted  recommendations  from  the  European  Commission  and/or  the  Venice 
Commission. Montenegro did not adopt some important pieces of legislation, such as the Law 
on Government and the Law on Parliament, which are needed to improve overall governance. 

Communication between the Parliament and the executive, and with independent institutions, 
was  challenging.  In  some  instances,  the  government  failed  to  deliver  its  opinions  on 
legislative initiatives introduced by MPs. A particular relevant case – due to its fiscal impact – 
was the draft Law on compensation for former recipients of the benefit for mothers of three or 
more children. Opinions on major legislative proposals were adopted without discussion, most 
notably  by  the  Committee  on  Economy,  Finance  and  Budget.  There  was  a  lack  of 
parliamentary  activity  on  EU  accession  issues  or  coordination  with  the  relevant  ministries. 
The Committee on European Integration held its last session in July 2022.  

The oversight function of the Parliament was limited. The Rules of Procedure provide that 
the PM’s hour takes place once a month. However, only two such sittings were held during 
the  reporting  period.  Parliamentary  committees  held  27  consultative  and  nine  control 
hearings. As part of their supervisory activities, the committees considered numerous reports 
that independent bodies submitted to the Parliament in accordance with the law. There is no 
uniform  practice  in  or  approach  to  conducting  parliamentary  hearings  or  reviewing  reports 
and proposed legislation.   

the  principle  of  openness  and 
The  Parliament  continued  working  on  promoting 
transparency. The public submitted 37 requests for free access to information to which the 
Parliament responded. The Parliament received 99 citizen submissions and 15 e-petitions. Of 
these  e-petitions,  one  resulted  in  a  consultative  hearing  before  the  Committee  on  Health, 
Labour  and  Social  Welfare.  The  Parliament  introduced  accessibility  features  on  its  website, 
adapting its content to blind and partially sighted persons. In cooperation with the European 
Parliament, in November 2022, the Parliament organised the second ‘Citizens’ Assembly’ to 
enhance the general public’s participation in the decision-making and policymaking process. 
The Parliament also organised the ‘Simulation of Parliament’ for high school students, as well 
as a Youth Parliament session. No reports on violations of the Code of Ethics were submitted 
to the Committee on Human Rights and Freedoms in the reporting period.  

The Parliament continued to further strengthen the control and supervisory functions and the 
capacity of the legal harmonisation service. On the proposal of the Administrative Board and 
at the request of the Special State Prosecutor’s Office, in April 2023, the Parliament adopted a 
decision  to  allow  the  initiating  of  criminal  proceedings  against  five  opposition  MPs  due  to 
alleged abuse of their official position. The Parliament’s cross-party Women’s Club continued 
its active role.  

Governance 

Since the no-confidence vote in August 2022, the government has carried out its duties in a 
caretaker capacity and with limited accountability, due to the inability of the political system 
to  form  a new government  or proceed to  early elections. Against the background of unclear 
rules  governing  the  competences  of  a  caretaker  government,  the  government  continued  to 
adopt important decisions and to dismiss and appoint key officials. Furthermore, in November 
2022 the caretaker PM decided to dismiss the caretaker Ministers of Defence and of Foreign 
Affairs, and the Parliament endorsed his decision. In December 2022, the caretaker Minister 
of  European  Affairs  resigned.  All  vacancies  were  filled  ad  interim.  The  lack  of  ministerial 
coordination  remains  a  cause  for  concern.  Following  the  June  parliamentary  elections,  the 

14 

 
 
new government was established on 31 October.   

In  October  2022,  the  government  dismissed  the  acting  Director  of  the  National  Security 
Agency  (ANB)  on  the  grounds  of  alleged  non-compliance  with  the  Law  on  ANB,  and 
appointed  a  new  acting  Director.  In  March  2023,  following  the  arrests  of  police  officials 
suspected  of  being  connected  to  criminal  groups,  the  government  decided  to  dismiss  the 
Police  Director  on  the  grounds  of  ‘functional  responsibility’.  The  Police  Director  brought  a 
lawsuit  against  the  government  before  the  Administrative  Court.  In  July  2023,  the  Court 
overturned  the  government's  decision  and  established  that  the  dismissal  decision  violated 
existing regulations. Shortly afterwards, the government adopted a new decision terminating 
again  the  Police  Director’s  mandate,  following  which  the  Police  Director  submitted  a  new 
lawsuit  The  Court  is  yet  to  decide,  but  it  rejected  as  unfounded  the  request  to  postpone  the 
enforcement of the dismissal decision until a final legal decision is made. 

The  35  diplomatic  representative  offices  of  Montenegro  are  led  by  13  ambassadors  and  22 
chargés d’affaires. Some of them were appointed by the caretaker government.  

In February 2023, the caretaker government  adopted its  Annual Work Programme for 2023. 
In  the  reporting  period,  it  adopted  56  law  proposals,  37  of  which  were  accompanied  by 
Regulatory  Impact  Assessment  (RIA)  form.  It  passed  35  decrees,  26  of  which  with  a 
completed  regulatory  impact  assessment  RIA  form.  In  November  2022,  the  caretaker 
government  adopted  a  decision  to  set  up  negotiating  working  groups  for  all  EU  acquis 
chapters except for chapter 12.   

Overall,  transparency  of  governance  remained  an  issue.  However,  the  government  took 
some  positive  steps  including  the  regular,  proactive  publication  of  information  on  all 
expenditure  from  the  state  budget.  The  government  continued  to  broadcast  its  sessions live. 
However, the government frequently resorted to the procedural option of adopting decisions 
without formally holding a government session. When new legislation needs to be adopted, an 
inclusive consultation process must be followed. This process should under all circumstances 
uphold  the  legal  safeguards  against  undue  political  influence  on  independent  public  and 
regulatory institutions. Any legal changes to their composition and governance should avoid 
potentially  disruptive  action  that  could  affect  the  functioning  of  the  management  bodies  of 
those institutions. 

As  for  local  governance,  the  new  Podgorica  local  government  was  only  formed  in  April 
2023, six months after the October 2022 local elections. Meanwhile, the incumbent Municipal 
Assembly and local government exercised their functions in a caretaker capacity (see section 
on  elections).  The  mayor  of  Budva  was  arrested  in  April  2023  on  suspicion  of  creating  a 
criminal organisation and drug smuggling. To address this situation and enable the formation 
of a new local government pending the finalisation of electoral results, in December 2022, an 
ad  hoc  majority  of  three  political  blocks  adopted  amendments  to  the  Law  on  local  self-
government  by  simple  majority.  According  to  the  amendments,  if  the  Municipal  Election 
Commission does not announce the final election results within 60 days, the mandate  of the 
local parliament in power would end by force of law. It is highly questionable whether these 
amendments  are  compatible  with  the  Constitution.  Thus,  President  Dukanović  returned  the 
Law to the Parliament for review. However, the Parliament adopted it again in March 2023. 
As  for  other  pieces  of  legislation  adopted  following  the  dissolution  of  the  Parliament,  both 
President Dukanović and his successor refused to sign them.  

At the end of December 2022, the parliamentary majority in the Podgorica Assembly adopted 
a  decision  to  increase  the  salaries  of  civil  servants  and  state  employees  by  up  to  30%. 
Women’s political participation remained low at local level with the exception of Podgorica 

15 

 
 
and Budva. In Podgorica, the newly appointed mayor and the president of the local assembly 
are women. In Budva, most of the members of the new Municipal Assembly are women.  

Civil society 

The  role  of  civil  society  is  recognised  and  promoted.  However,  the  legal  and  institutional 
framework regulating cooperation between state institutions and civil society still needs to be 
improved. Politicians – including at the highest level – frequently belittled the work of civil 
society  organisations  (CSOs)  and  isolated  cases  of  verbal  attacks  were  reported,  when,  for 
example,  they  criticised  the  work  of  the  government.  Recommendations  from  last  year’s 
report remain largely valid.  

The Council for Co-operation of State Bodies and Non-Governmental Organisations has not 
resumed its work. The government’s financial support for CSOs is regulated by a set of rules 
ensuring  transparency  and  external  evaluation.  However,  Montenegro  needs  to  strengthen 
ministries’ capacity for strategic planning, monitoring and evaluation of support provided 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,  association  and 
assembly is in place, but important pieces of legislation are lacking or need revision. The tax 
law  provides  some  incentives  to  philanthropy,  but  its  notion  of  ‘public  interest’  is  more 
limited than in the Law on NGOs, therefore restricting tax incentives. Montenegro still needs 
to align its legal framework on access to information with the EU acquis. Under the current 
law,  public  institutions  could  restrict  the  access  of  CSOs  to  key  policy  decisions  by 
classifying this information. Montenegro has a Law on volunteer work, promoting voluntary 
work  for  state  institutions  to  gain  professional  experience.  However,  a  broader  legal 
framework is needed to promote the free use of time, knowledge and skills for the benefit of 
volunteering activities. Draft amendments have been under discussion  since 2019, but were 
not finalised. Amendments to the Law on NGOs are being drafted to improve the procedures 
for  setting  up,  registering  and  operating  NGOs.  CSO  representatives  were  appointed  to  the 
working group discussing the draft amendments.  

A strategy promoting cooperation with NGOs for 2022-2026 was adopted in July 2022, after 
a  broad  public  consultation  process,  and  is  being  implemented.  The  strategy  confirms  the 
position of civil society as a strong partner of the state in public policy-making, and proposes 
to improve the digital registration procedures for CSOs and to publish CSO projects’ results 
online.  

The role of civil society in the EU accession process is recognised in theory, but insufficiently 
in practice. CSO representatives participate in working groups discussing chapters of the EU 
accession  negotiations.  In  2022,  all  ministries  appointed  CSO  representatives  to  working 
groups set up to draft laws and national strategies in their respective areas, in compliance with 
the Law on public administration. However, not all ministries conducted public consultations 
on draft laws. The report adopted by the government in December 2022 on conducting public 
consultations when drafting laws and strategies found that a significant number of laws were 
adopted without prior consultation with civil society.  

On 22 July 2022, the government adopted a decision on appointing members of the Council 
for Co-operation of State Bodies and Non-Governmental Organisations, a body consisting of 
an equal number of state officials  and  NGO  representatives.  One of its responsibilities is  to 
oversee the implementation of the strategy for cooperation with NGOs. However, there were 

16 

 
 
not enough applications from NGO representatives to become members of the Council in each 
of  the  thematic  areas,  despite  the  consecutive  launch  of  six  public  calls.  This  reflects  a 
perceived lack of relevance of the body among CSOs. Therefore, the Council did not resume 
its work, which was interrupted in October 2021. This undermines the dialogue between the 
government  and  civil  society  and  should  be  addressed  as  a  matter  of  priority  by  holding  an 
inclusive dialogue. 

The rules for public funding of CSOs oblige 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. Despite this obligation, not all ministries launched calls 
for proposals to finance CSO projects. In some cases, the calls for proposals were delayed; as 
a  result,  more  than  EUR 1.1  million  earmarked  for  this  purpose  in  the  2022  budget  has  not 
been allocated. 

In  some  cases,  the  lack  of  clear  and  fair  selection  criteria  resulted  in  the  selection  of  CSOs 
with  no  experience  in  the  area,  or  the  selection  of  CSOs  unfit  for  the  work  with  a  specific 
target  group.  In the area of trafficking in human beings,  the Ministry of  Interior  allocated a 
grant to a CSO whose manager had been accused of exerting violence against minor victims 
of  trafficking,  during  a  previous  grant  of  the  Ministry.  The  two  minor  victims  had  filed  a 
complaint  with  the  local  police.  Allocation  of  state  funds  must  be  based  on  the  highest 
professionalism and integrity criteria and be safeguarded by a control mechanism.  

The annual report on the financing of CSO projects in 2021 was published in December 2022, 
concluding  that  92%  of  the  allocated  amount  was  spent.  The  Ministry  of  Public 
Administration  created  a  website  centralising  information  for  CSOs,  including  funding 
opportunities.  However,  more  efforts  from  ministries  are  needed  on  coordination,  strategic 
planning, monitoring and evaluation of the support they provide to CSOs.  

CSOs can also access funds at local level, according to the Law on local self-government. In 
2022, 18 municipalities (out of 23) launched calls for proposals. 

2.1.2. Public administration reform 

Montenegro  is  moderately  prepared  in  the  area  of  public  administration  reform.  Overall, 
limited  progress  was  made.  Implementation  of  the  public  administration  reform  strategy 
continued, while a new public finance management reform programme was adopted and its 
implementation was started. Both strategic documents are linked to the budgetary framework. 
By contrast, amendments to the civil service legislation adopted in 2021, introducing relaxed 
qualification requirements and ample discretion of appointing authorities to dismiss heads of 
the  Parliament  adopted 
administrative  authorities,  remained 
amendments  to  the  Law  on  local  self-government  to  harmonise  it  with  the  Law  on  civil 
service,  disregarding  last  year’s  recommendation.  The  relaxed  requirements  introduced  by 
these  amendments  are  a  source  of  continuing  concern  for  merit-based  recruitment, 
competence  and  independence  of  civil  servants.  Continued  staff  changes  in  the  public 
administration led to further loss of know-how on matters related to the EU accession process 
and an overall slowing of the pace of reforms. The Parliament has yet to adopt long-awaited 
amendments to the Law on access to information. Effective lines of accountability within the 
administration are still to be set up. 

in  place.  Furthermore, 

The 2022 recommendation on adoption and implementation of the strategic framework was 
met, while other recommendations remain valid. In the coming year, Montenegro should in 
particular: 

→  adopt and implement amendments to the Law on access to information in line with the 

17 

 
 
principles  of  good  public  administration  and  introduce  measures  to  reduce  the  high 
number of requests for information and related appeals; 

→  amend  the  Law  on  civil  servants  and  state  employees  and  the  Law  on  local  self-
government  to  ensure  that  recruitment  follows  the  principles  of  merit,  competence  and 
transparency. 

→  put  in  place  a  unified,  comprehensive  and  transparent  system  for  capital  investment 

planning and management.  

Strategic framework for public administration reform 

In  May  2023,  the  government  adopted  a  report  on  the  implementation  of  the  2022-2026 
public administration reform (PAR) strategy in 2022. Political support for PAR continued 
to  be  ensured  through  the  PAR  Council,  chaired  by  the  Prime  Minister.  The  format  of  the 
Council was  made more inclusive:  in  addition  to representatives of government institutions 
and  civil  society,  the  composition  was  expanded  to  include  representatives  of  the  trade 
unions. The PAR strategy and its action plan were linked to the 2023 budget.  

Rightsizing  (optimising)  public  administration  is  one  of  the  objectives  of  the  PAR 
strategy.  As  part  of  this,  functional  analyses  are  being  carried  out,  notably  in  the  health 
sector. At the same time, the number of employees at both central and local level continued to 
increase,  with  no  proper  prior  assessment.  Outgoing  governments  have  made  many 
appointments that burden the state budget for the next few years.  

Policy development and coordination 

The legal framework for policy development is in place. In February 2023, the government 
adopted  its  annual  work  programme  for  2023,  based  on  the  government’s  mid-term  work 
programme for 2022-2024.  

The  institutional  structures  for  a  coherent  policymaking  system  are  in  place.  The  overall 
quality of strategic documents improved. The general secretariat of the government increased 
its attention to incorporating gender and environment into all policies. Nevertheless, further 
work  is  needed  to  make  this  process  more  effective  and  practical,  including  by  training  all 
stakeholders.  Proper  costing  of  strategic  documents  and  their  linkages  to  the  budgetary 
process continue to require particular attention.  

Evidence-based  policymaking  remains  only  partially  ensured.  According  to  the  latest 
available  government  report  (2021),  ministries  are  not  consistently  carrying  out  public 
consultations,  with  consultations  being  held  on  45%  of  laws  and  strategies.  When  public 
consultations  were  carried  out,  mandatory  accompanying  documents  such  as  the  regulatory 
impact  assessment  (RIA)  were  published  for  less  than  half  of  the  drafts  under  consultation 
(48%).  However,  work  is  ongoing  to  improve  the  RIA  process,  including  by  developing  a 
new form.  

Public finance management (PFM) 

In December 2022, the government adopted a new PFM reform programme for 2022-2026 
with  an  action  plan  for  the  same  period.    In  May  2023,  the  government  adopted 
implementation reports for 2021 and 2022. The PAR Council provides political guidance for 
the  implementation  of  the  reform  programme  and  ensures  coordination  with  the  PAR 
strategy.  The  new  reform  programme  is  linked  to  annual  budgeting  and  the  mid-term 
budgetary framework. It has a wider scope than the previous one as it now includes PFM at 
local  government  level.  The  government’s  investment  planning  and  public  investment 
management  capacity  needs  to  improve  significantly.  The  improved  legislative  framework 
18 

 
 
for public procurement and internal control needs to be implemented in practice. 

In  February  2023,  the  Parliament  adopted  amendments  to  the  Law  on  budget  and  fiscal 
responsibility, mainly to set up the Fiscal Council, an independent oversight body. However, 
during  the  preparation  of  the  law,  there  was  no  regular  consultation  process  among 
Montenegrin  institutions,  with  no  public  consultations  nor  RIAs.  Members  of  the  Fiscal 
Council have not yet been appointed. Appropriate political backing will be necessary for the 
Council to add value to the PFM system as a trusted institution.  

As  concerns  digitalisation  in  the  PFM  area,  the  state  budget  electronic  system  and  central 
calculation of salaries improved. However, not  all public institutions have been included in 
the centralised salary system. The interoperability of the different  IT systems, including the 
treasury  system,  is  yet  to  be  completed.  This  is  delaying  progress  in  the  area  of  PFM  on 
issues such as introducing accrual accounting and fully developing performance budgeting. 

On budget transparency, Montenegro published key budgetary documents timely. However, 
the  readability  of  budget  information  did  not  improve  significantly,  and  no  transparency 
roadmap was published. Programme-based budget classification was improved continuously 
with  programme  goals  and  performance  indicators,  but  weaknesses  in  monitoring  and 
reporting continue to limit the analysis of the effectiveness of spending and the efficiency of 
service delivery. Pre-budget and mid-year budget execution reports were published according 
to  economic, organisational  and programme classifications. In  addition,  public participation 
in  the  budget  process  and  the  Parliament’s  oversight  of  the  budget  is  yet  to  be  improved, 
including  by  publishing  the  ‘citizens’  budget’,  which  remains  pending.  The  Parliament 
adopted  the  2023  budget  in  line  with  the  budget  calendar  but  with  limited  qualitative 
assessment. 

Public service and human resources management 

Amendments  adopted  to  the  Law  on  civil  servants  and  state  employees  in  2021, 
introducing relaxed qualification requirements and ample discretion of appointing authorities 
to  dismiss  heads  of  administrative  authorities,  remained  in  place.  In  December  2022,  the 
Parliament  adopted  amendments  to  the  Law  on  local  self-government  relaxing  the 
requirements  for  recruitment  and  dismissal  of  local  civil  servants,  aligning  it  with  the 
amendments  to  the  2021  Law  on  civil  servants  and  state  employees.  In  February  2023,  the 
government adopted an agreement on public administration and the judiciary to increase the 
salaries of around 20 000 public employees by an average of more than 30%, with immediate 
effect.  

The  Human  Resources  Management  Authority  worked  on  developing  the  methodology  to 
monitor human resources management. Some improvements have been made to the related 
information  system,  but  due  also  to  the  cyberattack  in  2022,  the  system  is  yet  to  be 
completed. Nevertheless, human resources plans are still not aligned with the budget process.  

The legal and policy framework is in place to promote gender balance in civil service, and 
efforts are being  made to  mainstream  gender across  all aspects  of the public administration 
reform.  Further  work  is  needed  to  collect  and  disaggregate  data  on  gender  parity  across  all 
levels  of  the  public  administration  and  to  prepare  a  planned  gender  equality  plan  for  the 
Ministries.  

Accountability of administration 

The Parliament has yet to adopt amendments to the Law on access to information although 
the preparation and consultation process has already taken years. It is also important to solve 
the  current  problems  regarding  the  high  number  of  requests  for  information  and  related 

19 

 
 
appeals.  After a 9-month period of inactivity, the Council of the Agency for Personal  Data 
Protection and Free Access to Information started working again as an appeal body when two 
vacant positions (including that of chairperson) were filled in August 2022.  

As  concerns  lines  of  accountability,  the  legislative  framework  for  the  supervision  of  the 
work  of  state  administration  bodies  is  in  place.  The  framework  specifies  the  lines  of 
responsibility  of  ministries  and  their  respective  bodies.  However,  the  functioning  of  this 
framework  needs  to  be  improved,  including  the  process  and  quality  of  reporting  by 
subordinate authorities to the relevant ministries.  

The organisational set-up of the state administration is still not fully aligned with the Law 
on state administration. In the reporting period, the government changed the organisation of 
the  state  administration  three  times.  This  resulted  in  reorganisations  of  the  state 
administration without appropriate prior analysis and led to significant staff turnover because 
the tenure of incumbent managers was ended and new managers were appointed.   

The  legal  basis  is  in  place  to  ensure  the  citizens’  right  to  good  administration  in 
administrative procedures and judicial review and for public authorities to assume liability in 
cases of wrongdoing and ensure the citizens’ right to seek compensation.  However, cases of 
administrative disputes are not treated in a reasonable time. The Administrative Court has a 
very large number of administrative disputes from the area of access to information and as a 
consequence, the estimated duration of handling cases has increased to more than three years. 
Also,  as  public  authorities  are  often  not  enforcing  court  judgements  voluntarily.    Even  if  a 
court makes a judgement in favour of the citizen and the administration needs to compensate 
for  its  wrongdoing,  the  citizen  needs  to  initiate  enforcement  proceedings,  which  takes 
additional time.  

Service delivery to citizens and businesses 

The process of modernising public service delivery in Montenegro remained slow. The Law 
on  administrative  procedures  was  not  consistently  implemented,  notably  as  concerns  the 
‘once only’ principle and electronic communication. Services in general remain bureaucratic 
and are not user-friendly.  

Overall, the digitalisation of public services remains modest, particularly for services offered 
to  individuals.  Recent  survey  data  on  people’s  use  of  e-administration  shows  that  in 
Montenegro  less  than  30%  used  the  internet  to  interact  with  public  administration  in  2021, 
compared  with  the  EU  average  of  58.50%.    Montenegro  made  some  progress  in  the  digital 
government  area,  notably  on  the  functional  interoperability  framework  and  active  electronic 
data exchange among various government institutions. Nevertheless, the government needs to 
invest in transforming these key enablers into tangible results for people, working both on the 
supply side (issuing more streamlined, user-friendly digital services and eID solutions) and on 
the  demand  side  (understanding  the  reasons  for  people’s  low  take-up  of  available  digital 
services and removing the obstacles). Montenegro has not aligned with the latest revision of 
the European Interoperability Framework and the Interoperable Europe Act. 

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  an  effective  fight  against 
corruption are of paramount importance, as is respect for fundamental rights in law and in 

20 

 
 
 
practice. 

Montenegro remains moderately prepared to apply the EU acquis and European standards 
in  this  area  and  has  made  limited  progress  overall.  No  progress  was  achieved  on  justice 
reform, to date the most challenging area of the rule of law. The judicial system continued to 
face a deep institutional crisis and remains affected by issues of accountability, among other 
weaknesses.  As  stated  in  previous  annual  reports,  corruption  and  high-level  corruption 
remain issues of concern and are prevalent in many areas, including within state structures. 
Limited  progress  was  achieved  in  preventing  corruption,  but  the  legislative  and  strategic 
framework have yet to be fully upgraded. Several high-profile cases of corruption are under 
investigation. Montenegro needs to demonstrate a stringent and unambiguous criminal justice 
response.  Montenegro  continues  to  meet  its  obligations  on  fundamental  rights  under 
international  human  rights  instruments  and  legislation.  However,  challenges  remain  in 
ensuring  effective  implementation  of  legislation,  in  particular  for  the  most  vulnerable.  The 
continuing trend of increase in the number of femicides and cases of gender-based violence 
remains  an  issue  of  serious  concern.  Full  and  effective  protection  of  journalists  and  other 
media workers continues to improve, yet tangible results on old cases of attacks have yet to 
be achieved. 

Functioning of the judiciary 

Montenegro’s  judicial  system  is  moderately  prepared,  with  no  progress  on  the 
implementation  of  key  judicial  reforms.  The  functioning  of  the  justice  system  continued  to 
face  challenges  including  pending  appointments  and  a  number  of  crucial  posts  that  remain 
occupied  ad  interim  beyond  the  mandate  limited  by  the  Constitution  or  other  relevant 
legislation  This  resulted  in  weak  leadership  and  management,  lack  of  strategic  vision  and 
poor  planning,  affecting  the  country’s  ability  to  deliver  justice  and  undermining  the 
legitimacy  of  the  highest  judicial  institutions.  This  was  particularly  serious  for  the 
Constitutional Court, which was left without a quorum from September 2022 until February 
2023, when the Parliament appointed three judges. The Court still has one vacant position. 

Several  events  described  in  the  text  below  suggest  that  the  independence,  impartiality, 
accountability  and  professionalism  of  the  judiciary  have  yet  to  be  improved.  Ensuring  the 
ethical  and  disciplinary  accountability  of  judges  and  prosecutors  remains  an  issue. 
Furthermore,  the  Law  on  Judicial  Council  and  judges,  and  the  Law  on  State  Prosecution 
Service,  have  yet  to  be  amended  in  line  with  European  standards  and  the  EU  acquis, 
following  the  existing  European  Commission  recommendations  and  Venice  Commission 
opinions. These two laws are central to the functioning of the judiciary and the prosecution, 
ensuring,  respectively,  their  independence  and  autonomy,  impartiality,  accountability,  and 
professionalism.  

The efficiency of the judiciary also needs to be strengthened. The human, financial, physical 
infrastructure  and  ICT  management  systems  require  improvement.  The  adoption  of  a  new 
strategy on the rationalisation of the judicial network is still pending.  

The proper functioning of the judiciary in line with European standards has yet to be proven. 
There must be a genuine and unambiguous commitment from the executive and the judiciary 
to guaranteeing the implementation of reforms, and a political dialogue in the Parliament to 
secure  the  required  majority  for  all  pending  senior  judicial  appointments  and  pieces  of 
legislation. 

Montenegro continues to make progress on the domestic handling of war crimes, with good 
judicial cooperation  with  neighbouring countries  and the  International  Residual  Mechanism 

21 

 
 
for Criminal Tribunals.  

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

→  appoint the remaining  members of the Constitutional  Court and the Judicial Council, a 
permanent  President of the Supreme Court, and a permanent  Supreme State Prosecutor 
and  President  of  the  Prosecutorial  Council,  based  on  merit  and  in  a  transparent 
procedure,  to  ensure  the  proper  functioning  of  the  judiciary  with  independence, 
impartiality and integrity of officeholders in key judicial positions;  

→  amend  the  Law  on  Judicial  Council  and judges,  the  Law  on  State  Prosecution  Service, 
and convincingly plan the necessary amendments to the Constitution, addressing all the 
already existing European Commission recommendations, Venice Commission opinions 
and Council of Europe Group of States against Corruption (GRECO) recommendations, 
to bring them in line with the EU acquis and European standards on the independence of 
the  judiciary  and  autonomy  of  the  prosecution,  as  well  as  their  impartiality, 
accountability and professionalism;  

→  adopt a new strategy and action plan for the judicial reform and for the rationalisation of 
the judicial network; fully implement the ICT strategy, to improve the efficiency of the 
system. 

Strategic documents 

Justice reform remains the most challenging area of the rule of law. There were no results on 
the  implementation  of  the  2019-2022  strategy  for  the  reform  of  the  judiciary  and  its  2021-
2022  action  plan.  The  government  did  not  adopt  any  new  strategic  documents  on  judicial 
reforms.  The  Ministry  of  Justice  did  not  demonstrate  the  required  level  of  commitment  to 
fully and timely implementing all segments of the judicial reforms.  

Management bodies 

The functioning of the judiciary continues to face a deep institutional crisis.  

On  27 February 2023,  the  Parliament  appointed  three  judges  to  the  Constitutional  Court, 
thus  restoring  the  Court’s  decision-making  quorum.  This  ended  an  unprecedented 
institutional  blockade  for  Montenegro  that  left  the  Court  unable  to  function  between 
September  2022  and  February  2023.  This  affected  the  capacity  of  Montenegro  to  finalise 
local election results, led to instances of politically opportunistic behaviour, and prompted the 
Venice  Commission  to  exceptionally  step  in,  in  place  of  the  Court,  to  examine  the 
constitutionality of proposed amendments to the Law on the President upon the request of the 
President  of  Montenegro.  The  Parliament  still  needs  to  appoint  the  seventh  (final)  judge 
needed for the Court to function in full compliance with the Constitution.  

The Constitutional Court’s ability to function properly, its performance and  efficiency were 
undermined  throughout  2022  due  to  its  incomplete  composition,  even  before  it  lost  its 
quorum in September after the retirement of one judge, leaving the Court with only three out 
of  seven  judges.  With  its  quorum  restored  in  February  2023,  the  Constitutional  Court 
resumed its work on a very substantial backlog  of over 3 000 constitutional complaints and 
over 250 initiatives for reviewing the constitutionality of laws and other legal acts. The Court 
resolved  the  appeals  against  the  local  election  results,  which  were  confirmed,  enabling  the 
formation of local governments in certain municipalities, including Podgorica.  

The Judicial and Prosecutorial Councils are the two main bodies for the self-government of 
the  judicial  system,  bearing  responsibilities  for  the  careers  of  judges  and  prosecutors.  The 
22 

 
 
composition,  appointment  procedures  and  functioning  of  these  two  bodies  remain  issues  of 
concern that affect more broadly the whole justice sector, including on the balance between 
independence and accountability. The Law on Judicial Council and Judges, and the Law on 
State Prosecution Service, remain to be amended in line with European standards and the EU 
acquis,  following  the  existing  European  Commission  recommendations  and  the  Venice 
Commission opinions. 

After  two  years  in  incomplete  composition,  the  Judicial  Council  has  now  all  of  its 
10 members in place. In 2022, the General Conference of Judges elected four new members 
to the Council. The Council’s long-lasting incomplete composition undermined its decision-
making, which requires a two-thirds majority in several instances, such as the appointment of 
the Supreme Court President (pending since 2020). This undermined the overall functioning 
of the justice system.  

The Judicial Council still operates with three of its lay members in office beyond the formal 
end  of  their  term  of  office  in  2018,  including  its  acting  President.  This  is  contrary  to  the 
Constitution,  which  limits  the  term  of  office  of  members  of  the  Council  to  four  years. 
However, due to failure to reach a qualified majority in the Parliament for the election of new 
non-judicial  members,  a  temporary  anti-deadlock  mechanism  continues  to  apply.  This 
mechanism  was  introduced  in  2018  to  ensure  that  the  lay  members  concerned  remain  in 
office until new ones are appointed. The three non-judicial members are currently in their 10th 
year in office. This undermined the Council’s democratic legitimacy and accountability.     

A new call for the non-judicial posts was published in December 2022 and 11 candidates are 
undergoing  the  selection  process  before  the  Parliamentary  Committee  on  Political  System 
and Judiciary. 

At its first session in its new composition in August 2022, the Judicial Council appointed new 
members to its working committees. The 2023 budget proposal amounts to EUR 2 648 609. 
This  represents  an  increase  of  20%  compared  with  2021,  mainly  due  to  the  planned 
procurement of licences to operate the Judicial Information System. The Council’s working 
space and working conditions in general continued to be inadequate. 

The  appointment  of  a  permanent  Supreme  State  Prosecutor  (SSP)  –  who  is  also  the 
President of the Prosecutorial Council – has been pending since October 2019 due to lack 
of cross-party consensus in the Parliament.  

In July  2022, the  Prosecutorial Council  decided to  extend the term of office of the acting 
SSP for six additional months, in line with the temporary anti-deadlock mechanism set in the 
Law on State Prosecution Service. In February 2023, the Council appointed a new acting SSP 
for  a  term  of  office  of  six  months,  through  a  decision-making  process  that  raised  concerns 
over  compliance  with  the  relevant  provisions  of  the  Law  on  State  Prosecution  Service  as 
described in the following section. 

During the reporting period, the Prosecutorial Council held eight sessions. The 2023 budget 
of  the  Council  is  EUR 673 205  (2022:  EUR 548 529).  The  Prosecutorial  Council  must  still 
ensure a more proactive approach to addressing issues in the public prosecution service, for 
example the evaluation of the professional performance of Heads of State Prosecution Offices 
and  of  State  Prosecutors  themselves,  including  their  accountability  and  professionalism.  In 
December  2022,  the  Council  adopted  its  2023-2025  communication  strategy,  including  the 
accompanying  2023  action  plan.  Additionally,  the  Council  adopted  a  new  reporting 
methodology. 

Further  efforts  are  needed  to  substantially  improve  the  functioning  of  the  entire  judicial 

23 

 
 
system and restore public trust in it. While the transparency of the Judicial and Prosecutorial 
Councils  continued  to  improve,  it  has  yet  to  be  further  strengthened.  Sessions  of  both 
Councils are open to the interested public (media, NGOs), but further measures are needed, 
such  as  publishing  fully  reasoned  decisions  on  promotions,  appointments,  and  disciplinary 
cases.  The  operational  capacity  of  both  Councils’  secretariats  continues  to  improve  but 
should  be  strengthened  further.  Their  administrative  capacity  has  yet  to  be  improved, 
including regarding planning and management of strategic, budget and human resources, as 
well as public communication. Members of both Councils should devote more time and show 
full commitment to performing their functions. Overall, resource levels do not match judicial 
performance  targets.  Other  key  high-level  judicial  appointments  remain  pending  ultimately 
affecting  Montenegro’s  ability  to  deliver  effective  justice.  This  lack  of  appointments 
significantly  hampers  the  correct  functioning  of  the  highest  instances  and  the  management 
bodies  of  the  judiciary.  This  undermines  their  capacity  to  exercise  their  powers,  which  are 
key  to  ensuring  the  independence  of  the  justice  system  and  to  providing  strategic  guidance 
and leadership in the reform process.  

Montenegro  has  yet  to  implement  key  constitutional  amendments  in  line  with  the 
recommendations  of  the  Venice  Commission  and  GRECO  and  with  other  European 
standards.  This  includes  the  outstanding  adoption  of  relevant  implementing  legislation. 
Montenegro  did  not  address  fully  the  2021  Venice  Commission  recommendations  on  the 
amendments  to  the  Law  on  State  Prosecution  Service,  including  on  the  appointment  by 
qualified  majority  of  the  lay  members  of  the  Prosecutorial  Council,  to  reduce  the  risks  of 
undue  political  influence  over  the  Council.  Montenegro  has  yet  to  ensure  the  effective 
independence  and  professionalism  of  the  judiciary,  including  by  fully  and  unambiguously 
implementing  the  relevant  constitutional  and  legal  framework  in  line  with  European 
standards. The revision of the Law on Judicial Council and judges is ongoing; however, the 
European  Commission  and  Venice  Commission  recommendations  have  yet  to  be  fully 
addressed. 

Montenegro has yet to take tangible measures to demonstrate its unambiguous commitment 
to guaranteeing the proper functioning of the judiciary in line with European standards. The 
executive and the judiciary need to be genuinely determined to support the implementation of 
reforms. Political dialogue in the Parliament is also essential to secure the required majority 
for all pending senior judicial appointments and pieces of legislation.  

Independence and impartiality 

Following the 2013 amendments to the 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.  However,  the 
judiciary  and  the  prosecution  service  remain  to  be  perceived  as  vulnerable  to  political 
interference and the level of public confidence in the judicial system remains low. This is due 
mainly to an insufficient rule of law culture in relevant institutions and to shortcomings in the 
relevant  legislation.  At  the  same  time,  the  executive  and  legislative  branches  must  avoid 
publicly discrediting the judiciary.  

The legal framework guaranteeing the independence and impartiality of the judiciary is being 
revised.  Following  an  extensive  and  inclusive  consultation  process,  in  October  2022,  the 
Ministry  of  Justice  requested  an  opinion  from  the  Venice  Commission  on  the  draft 
amendments  to  the  Law  on  Judicial  Council  and  judges.  The  December  2022  opinion 
pointed  to  several  issues  to  be  addressed,  including  most  of  the  2014  Venice  Commission 
recommendations  on  the  same  Law.  These  include,  regulating  judges’  work-related  rights 
(including  their  retirement  age  and  pension  rights),  limiting  the  use  of  temporary  anti-
24 

 
 
deadlock  mechanisms  for  key  appointments  to  specific  exceptional  events,  bringing  the 
evaluation  and  disciplinary  proceedings  of  judges  in  line  with  European  standards,  and 
strengthening  the  independence  of  the  Judicial  Council  and  the  legal  guarantees  to  avoid 
undue  political  influence.  In  February  2023,  the  Ministry  of  Justice  requested  a  follow-up 
opinion from the Venice Commission based on an updated version of the draft amendments, 
which  concluded  in  March  2023  that  several  of  these  important  recommendations  have  not 
been followed and remain valid. On 1 June 2023, the government adopted draft amendments 
to  the  Law  on  Judicial  Council  and  judges.  These  amendments  improve  certain  technical 
aspects  of  the  current  Law,  but  do  not  address  several  important  recommendations  of  the 
European  Commission  and  the  Venice  Commission  in  substance,  including  the  above-
mentioned ones. They are therefore not sufficient to bring the Law in line with the EU acquis 
and  European  standards  regarding  the  independence,  impartiality,  accountability,  integrity 
and efficiency of the judiciary and need further revision.  

In  addition,  the  2021  Venice  Commission  recommendations  on  the  Law  on  State 
Prosecution  Service  have  yet  to  be  addressed.  In  particular,  Montenegro  has  not  fully 
addressed  recommendations  related  to  the  election  of  lay  members  to  the  Prosecutorial 
Council and the need to ensure that the Council is not politicised in this process. In addition, 
Montenegro  has  yet  to  address  the  concerns  over  the  termination  of  the  mandate  of  the 
Prosecutorial  Council  members  immediately  after  the  entry  into  force  of  the  amendments, 
and the transitional arrangements proposed do not represent a solution to the serious issue of 
the need to find broad political consensus on the next SSP. In February 2023, the Ministry of 
Justice announced the setting-up of a working group to amend the Law.  

These  two  Laws  are  central  to  the  functioning  of  the  judiciary  and  have  yet  to  be  brought 
fully in line with European standards and the EU acquis.  

Contrary  to  his  predecessor,  the  Minister  of  Justice  took  active  part  in  the  Judicial  Council 
sessions as ex officio member. In October 2022, the Minister criticised the Judicial Council’s 
decision  to  publish  a  new  call  for  the  election  of  the  President  of  the  Supreme  Court  of 
Montenegro  as  he  did  not  consider  it  appropriate.  In  January  2023,  the  only  candidate  that 
applied,  the  current  acting  President  of  the  Supreme  Court  and  member  of  the  Judicial 
Council,  did  not  get  the  necessary  majority  due  to  the  interpretation  of  the  Law  by  the 
Supreme  Court’s  General  Session.  An  appeal  was  filed  before  the  Administrative  Court, 
which  overturned  the  decision  and  deemed  the  candidacy  valid  based  on  the  support  of  a 
sufficient  majority  of  Supreme  Court  judges.  Following  this,  the  Anti-Corruption  Agency 
initiated  proceedings  to  investigate  potential  aspects  of  corruption  in  the  Administrative 
Court’s  decision-making  process.  In  addition,  the  Anti-Corruption  Agency  submitted  a 
request  to  the  Ministry  of  Justice  to  conduct  an  inspection  of  the  Administrative  Court.  In 
July  2023,  the  Judicial  Council  did  not  support  the  appointment  of  the  current  acting 
President of the Supreme Court as full-term Supreme Court President. 

The  appointment  of  a  permanent  Supreme  Court  President  has  been  pending  since 
December 2020; attempts have failed five consecutive times.  

In April 2023, the Judicial Council appointed a new President of the Commercial Court. The 
constitutional  and  legal  framework  limit  the  period  in  office  of  Court  Presidents  to  a 
maximum  of  two  terms  to  prevent  over-concentration  of  power,  but  two  Basic  Court 
Presidents  (Basic  Courts  of  Danilovgrad  and  Zabljak)  were  reappointed  by  the  Judicial 
Council for a third mandate or more between 2019 and 2020 and are still in office.  

The  Judicial  Council  continued  its  good  practice  of  publishing  the  names  of  applicants  for 
judicial positions. 

25 

 
 
In  July  2022,  the  Prosecutorial  Council  decided  to  extend  the  term  of  office  of  the  acting 
Supreme  State  Prosecutor  (SSP)  –  who  is  also  the  acting  President  of  the  Prosecutorial 
Council – for six additional months, in line with the temporary anti-deadlock mechanism set 
in the Law on State Prosecution Service. 

In  September  2022,  based  on  a  legal  opinion  of  the  Ministry  of  Justice,  the  Prosecutorial 
Council  adopted  a  decision  granting  the  right  to  the  acting  SSP,  which  was  exercised  in 
February  2023  after  the  expiration  of  the  mandate  of  the  former  SSP,  to  remain  in  the 
Supreme State Prosecution Office (SSPO) as State Prosecutor. This decision is incompatible 
with the procedure for the appointment of State Prosecutors to the SSPO set in the Law on 
State Prosecution Service.  

In December 2022, the  Parliament once again  failed to  appoint a permanent  Supreme State 
Prosecutor who is also the President of the Prosecutorial Council.  

After  that,  still  in  December  2022,  the  Prosecutorial  Council  and  the  caretaker  government 
adopted  a  proposal  to  amend  the  Law  on  State  Prosecution  Service,  extending  the  term  of 
office  of  the  acting  SSP  virtually  ad  infinitum  until  the  Parliament  would  appoint  a  new 
permanent SSP. This was against the recommendations of the European Commission and the 
Venice  Commission  and  raised  concerns  over  the  respect  for  the  rule  of  law  and  the  key 
principles of independence and accountability of the judiciary and the separation of powers. 
Furthermore,  the  current  Law  on  State  Prosecution  Service  includes  an  anti-deadlock 
mechanism3  by which the Council may  appoint an interim SSP for a period of six  months, 
extendable  for  one  more  period  of  six  months.  Following  the  negative  opinion  of  the 
Parliament’s Judicial Committee, the caretaker government decided to withdraw the proposal 
from parliamentary procedure.  

On 6 February 2023, as the last mandate expired, the Prosecutorial Council failed to appoint a 
new acting SSP as neither of the two candidates received the required majority.  

Two  days  later,  the  Council  appointed  a  new  acting  SSP  from  among  its  prosecutorial 
members,  who  resigned  just  before  the  vote  took  place.  This  raised  concerns  regarding  the 
respect of the relevant provisions in the Law on State Prosecution Service, which determines 
that a prosecutor who is a member of the Prosecutorial Council can neither be appointed as 
head  of  the  Prosecution  Service  nor  be  promoted  during  their  mandate  in  the  Council.  In 
addition,  the  potential  conflicts  of  interest  during  the  decision-making  process  were  not 
addressed, as the appointee was involved as a member of the Council in the voting on the two 
other candidates for the same position two days earlier. In April 2023, the Council proposed 
one  candidate  to  the  Parliament  from  amongst  three  applicants  for  an  appointment  as 
permanent SSP following the launch of a public call in January 2023. The vote in Parliament 
is pending. In August 2023, the Council extended the mandate of the acting SSP, which had 
been elected in February 2023, for six additional months.  

The  Prosecutorial  Council  needs  to  show  genuine  and  unambiguous  commitment  to 
guaranteeing  the  full  independence  of  the  judiciary  and  to  fully  implementing  EU-related 
reforms in the judiciary in compliance with European standards.  

3 This mechanism was introduced in 2021, based on the opinion of the European Commission and the Venice 
Commission,  with  a  clear  caveat:  such  a  temporary  solution  should  not  last  too  long,  to  prevent  that  the 
constitutional provisions giving the power to elect the permanent SSP to the Parliament and limiting the SSP’s 
term of office would be deprived of any meaning. 

26 

 
 
 
In January 2023, the Council launched a new public call to appoint a permanent SSP, and in 
April 2023, it proposed one candidate to the Parliament among the three applicants. 

Accountability  

Promotion  and  enforcement  of  ethics  and  professional  standards  among  judges  and 
prosecutors  remains  a  challenge.  Both  the  Judicial  and  the  Prosecutorial  Councils  have  a 
limited  track  record  and  lack  proactivity.  Montenegro  did  not  amend  the  disciplinary  and 
ethical  legal  framework  for  judges  and  prosecutors.  Further  improvements  and  effective 
enforcement  of  the  judicial  inspection  system  are  needed,  including  more  thorough  and 
unannounced inspections.  

In October 2022, acting upon the request of the Disciplinary Prosecutor, the Judicial Council 
temporarily  removed  one  judge  from  the  Commercial  Court,  in  connection  to  criminal 
proceedings  launched  in  the  case  against  the  former  President  of  the  Supreme  Court.  In 
November 2022, the Special Prosecutor’s Office filed an indictment before the High Court in 
Podgorica against the former President of the Commercial Court of Montenegro on charges 
of organised crime, embezzlement, and other criminal offences. The indicted person remains 
in pre-trial detention. 

In December 2022, a Special Prosecutor from the Special Prosecution Office was arrested on 
organised  crime  and  corruption  charges.  Placed  in  pre-trial  detention,  the  Prosecutorial 
Council suspended him from office. 

In April 2023, the Minister of Justice  filed  a motion  for the dismissal  of  Head of the High 
Prosecutor’s Office in Podgorica over suspicion of exerting undue influence on a prosecutor 
in 1 case. Acting upon the Minister’s motion, the Disciplinary Prosecutor presented a motion 
for her dismissal to the Prosecutorial Council. In June 2023, the Council rejected the motion.  

There has been no progress in strengthening the accountability of judges and prosecutors and 
demonstrating a corresponding track record. The work of ethical commissions for judges and 
prosecutors remains mostly ineffective. During the reporting period, the Ethical Commission 
of the Judicial Council was not functioning. A legal remedy to challenge the Commission’s 
decisions has yet to be provided for by law. There are seven cases pending before the Ethical 
Commission. 

Following  the  new  composition  of  the  Prosecutorial  Council  in  August  2021,  the  Ethical 
Commission  of  the  Prosecutorial  Council  restarted  its  activities  only  in  September  2022, 
with  the processing of several pending  cases.  In one  case, the Ethical  Commission found a 
violation of the Code of Ethics for State Prosecutors, while in four cases, it found that State 
Prosecutors had not violated the Code. While one case was delegated to the Commission for 
examining complaints about the legality of the work of State Prosecutors and Heads of State 
Prosecution Offices, the remaining four cases are still pending before the Commission.  

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

Judges and prosecutors are required by law to declare their assets. However, the verification 
of  asset  declarations  by  the  Anti-Corruption  Agency  (ACA)  is  limited  to  a  check  of 
compliance  with  the  legal  obligation  to  submit  such  declarations,  which  can  only  result  in 
administrative  and  misdemeanour  proceedings.  The  competences  of  ACA  regarding  the 
verification of asset-declarations should be strengthened in order to ensure an effective asset-
declaration  system.  The  disciplinary  practice  of  the  Judicial  and  Prosecutorial  Councils  in 
sanctioning  judges  and  prosecutors  for  not  submitting  reports  on  assets  and  incomes  to  the 
ACA is not consistent and puts into question the effectiveness of this preventive mechanism. 

27 

 
 
The  Disciplinary  Committee  of  the  Judicial  Council  did  not  sanction  any  judge  for  not 
providing asset declarations, while the Disciplinary Committee of the Prosecutorial Council 
sanctioned non-compliant prosecutors with a 20% salary cut. 

There have been no significant results on enforcing measures to ensure the accountability of 
independent  legal  professions.  In  2023,  the  Ministry  of  Justice  initiated  proceedings  to 
establish the disciplinary liability of one public bailiff. The implementation of the new Codes 
of Ethics for notaries, public bailiffs and court interpreters remains limited. The draft of the 
new  Code  of  Ethics  for  lawyers  is  still  pending  adoption  by  the  Bar  Association.  The  self-
regulatory roles of the chambers and professional associations of legal professions must also 
be further strengthened. 

During  the  first  half  of  2023,  judicial  inspectors  of  the  Ministry  of  Justice  performed 
inspections  in  10  courts  and  six  prosecution  offices,  during  which  no  irregularities  were 
observed. In 2022, judicial inspectors of the Ministry of Justice carried out inspections in 20 
courts  and  16  prosecution  offices.  In  addition,  at  the  request  of  the  acting  President  of  the 
Supreme Court, an extraordinary inspection was conducted in the High Court in Podgorica. 
During the inspection of the courts and prosecution offices, 15 irregularities were found (8 in 
the  work  of  courts  and  7  in  the  work  of  prosecution  offices).  Judicial  inspectors  of  the 
Ministry of Justice performed regular checks of the legality of the work of 25 public bailiffs’ 
offices and the Chamber of Public Bailiffs, during which two irregularities were observed. In 
addition, judicial inspectors of the Ministry of Justice checked the legality of the work of 38 
notaries’ offices and the Chamber of Notaries, during which seven irregularities were found. 
The Ministry’s capacity in this area still requires significant strengthening.  

Professionalism and competence 

Montenegro  continues  to  organise  single  nation-wide  competitions  for  judges  and 
prosecutors. The Judicial Council appointed 20 new judges, while 14 judges were promoted 
to  higher  instance  courts.  In  addition,  three  court  Presidents  have  been  appointed  by  the 
Judicial  Council  (Commercial  Court,  Administrative  Court,  and  Basic  Court  in  Kotor).  In 
2022, the Council confirmed the termination of judicial function for 16 judges. 

In 2022, the Prosecutorial Council appointed the new Chief Special Prosecutor, the Head of 
the  Basic  State  Prosecutor’s  Office  in  Podgorica  and  17  State  Prosecutors.  In  2023,  the 
Council  appointed  the  Head  of  the  Basic  Prosecutor’s  Office  in  Cetinje.  The  Council 
confirmed the termination of prosecutorial function for 21 prosecutors, including the former 
Chief Special Prosecutor.  

Both Councils have yet to ensure the systematic conduct of regular assessments of judges and 
prosecutors.  Evaluations  need  to  be  more  thorough.  Both  Councils  should  develop  their 
appraisal  parameters  with  more  targeted  focus  on  magistrates’  accountability,  individual 
performance,  and  the  quality  of  work.  In  2022,  29  judges  (only  around  11%  of  the  active 
ones)  were  evaluated  as  part  of  the  regular  professional  assessment  procedure,  while  61 
judges and 7 State Prosecutors were  evaluated for the purpose of promotion.  In 2022, only 
three  State  Prosecutors  were  evaluated  as  part  of  the  regular  professional  assessment 
procedure, while 13 prosecutors were evaluated for the purpose of promotion and 13 at the 
end  of  their  4-year  terms  of  office.  The  fact  that  all  29  evaluated  prosecutors  received 
excellent  grades  raises  questions  over  the  objectivity  and  the  overall  purpose  of  the 
evaluation  process.  In  September  2022,  the  Prosecutorial  Council  adopted  revised  rules  on 
evaluation of State Prosecutors, which entered into force on 7 October 2022. 

The  interpretation  of  legal  conditions  for  old-age  retirement  of  judges  and  prosecutors  is 
disputed after the 2020 Law on pensions insurance lowered the general age requirement for 
28 

 
 
the  right  to  a  pension,  deviating  from  provisions  of  the  General  Labour  Law.  In  December 
2022, the Administrative Court annulled the Judicial Council’s decision from August 2021 to 
terminate the mandate of a judge of the Supreme Court due to fulfilment of the conditions for 
old-age retirement. Following this decision, the Judicial Council informed the Supreme Court 
that the judge has the right to return to work. In 2022, the Judicial and Prosecutorial Council 
declared  the  termination  of  the  mandates  of  nine  judges  and  10  State  Prosecutors  based  on 
their interpretation of fulfilment of the conditions for old-age retirement. Proceedings before 
the Constitutional Court on this subject are still ongoing. 

Quality of justice 

The  2023  budget  for  the  justice  system  is  EUR 42.01  million.  This  is  an  increase  of  11% 
compared  with  the  previous  year  (2022:  EUR 37.3  million). Courts  and prosecution  offices 
are considered as separate budgetary units in the state budget for 2023. While implementation 
of the programmatic budgetary framework is ongoing, the capacity of individual courts and 
prosecution  offices  to  effectively  apply  the  procedures  for  budgetary  planning,  resource 
allocation and execution remains insufficiently developed.  

In 2022, Montenegro had 263 full-time judge positions (42.4 per 100 000 inhabitants), 57% 
of whom were women, and 103 prosecutor positions (16.6 per 100 000 inhabitants), 62% of 
whom were women. According to the European Commission for the Efficiency of Justice, the 
European averages are 22.2 judges and 11.8 prosecutors per 100 000 inhabitants.  The 2022 
budgetary  allocation  for  the  judicial  system  in  Montenegro  was  about  EUR  35,249,852  € 
million. This amounts to around EUR 30 per inhabitant. 

On 1 June 2023, the government adopted draft amendments to the Law on Judicial Training 
Centre of Montenegro, proposing a reduction in the duration of the initial training for judges 
and  prosecutors  from  18  to  12  months.  Montenegro  did  not  consult  with  the  European 
Commission on these amendments, which are not in  line with European standards and with 
the recommendations already submitted to Montenegro. 

Overall,  apart  from  the  proposed  amendments,  the  functioning  of  the  Judicial  Training 
Centre (JTC) continues to improve. Its 2023 budget is EUR 869 819, which is in accordance 
with  the  amount  prescribed  by  law  (2%  of  the  budget  allocated  for  judiciary  and  state 
prosecution). In 2022, the total budget allocated to training initiatives at the JTC amounted to 
EUR 385 839, a reduction of 8.7% compared with the previous year. The JTC continued to 
implement  the  new  training  needs  assessment  (TNA)  methodology  adopted  in  2021  and 
prepared  a  comprehensive  TNA  report,  based  on  which  the  2023  training  programme  was 
developed. The JTC assessed the criteria and procedures for selecting and evaluating judicial 
trainers to further improve the quality of judicial training programming and delivery. As for 
the administrative capacity of the Secretariat of the Centre for Training in the Judiciary and 
Public Prosecution Service, out of the total of 19 planned positions, 15 are currently filled. 

The  positive  trend  in  alternative  dispute  resolution  (ADR)  continued  and  the  system 
continued  to  expand.  In  2022,  the  ADR  Centre  received  10 773  cases  for  mediation  (2021: 
7 297  cases).  Between  1 January 2023  and  30  June 2023,  the  ADR  Centre  received  3  914 
new cases, while 1 384 cases from 2022 are still pending. The increase in the number of cases 
of  mediation  referred  to  the  ADR  Centre  is  not  followed  by  an  appropriate  increase  in  the 
budget  and  staff  of  the  Centre.  From  July  to  October  2022,  a  public  awareness  raising 
initiative  presenting  the  work  of  the  ADR  Centre  and  the  benefits  of  mediation  was 
implemented to create an environment in which mediation is understood and accepted as an 
effective  way  to  resolve  disputes.  The  initiative  resulted  in  several  deliverables  aimed  at 
mediation stakeholders and the general public, including social media posts, city billboards, 

29 

 
 
animated video materials, etc. 

Efficiency  

In 2022, 130 881 cases (2021: 118 568) were pending before Montenegrin courts, 92 918 of 
which were new (2021: 84 143). A total of 78 758 cases were resolved (2021: 80 485). At the 
end of 2022, 51 539 cases were pending before Montenegrin courts and the number of cases 
older  than  three  years  stood  at  4 890  (2021:  3 794).  The  disposition  time  (the  average  time 
from  filing  to  decision)  was  178  days  for  Basic  Court  cases  (2021:  158),  442  days  for 
Commercial Court cases  (2021:  197) and 1 158 days for Administrative Court cases (2021: 
538). The clearance rate in 2022 decreased to 86%, from the 92% of 2021. 

In the first quarter of 2023, there were 79 027 cases before Montenegrin courts: 27 488 new 
cases  and  51 539  cases  that  were  unresolved  at  the  beginning  of  Q1-2023.  In  Q1-2023, 
20 262 cases  were resolved, of which 1 582 cases are older than three years.  At the end of 
Q1-2023,  there  were  6 946  old  cases  (older  than  2020)  not  resolved  before  Montenegrin 
courts.  

The backlog of pending enforcement cases before courts fell. At the end of 2022, 1 006 cases 
were pending (150 000 in 2016). In 2022, 70 801 cases were filed with bailiffs’ offices (2021: 
76 779),  with  42 201  cases  pending  by  the  end  of  the  year  (2021:  47 217).  The  number  of 
pending enforcement cases at the end of Q1-2023 was 1 560.  

Since the adoption of the analysis on the  rationalisation of the court network  in  October 
2020,  there  has  been  no  tangible  development.  In  2022,  the  Ministry  of  Justice  launched 
activities to  rationalise the court network based  on previous recommendations and with  the 
support  of  the  EU.  In  July  2022,  the  Ministry  set  up  a  working  group  including 
representatives of judicial and prosecutorial institutions to work on a strategic document. In 
March 2023, based on the findings of the 2020 analysis on the needs of the rationalisation of 
the  judicial  network,  and  on  submitted  proposals,  the  Ministry  prepared  a  draft  judicial 
network rationalisation plan setting out measures, activities, result and impact indicators, time 
limits,  competent  authorities,  and  sources  of  funding  necessary  to  rationalise  the  judicial 
network. A new strategic document on the rationalisation of the court network remains to be 
adopted. Reforms  in  this  area should draw on available data, conclusions from  studies, and 
cost-benefit  analyses,  while  ensuring  better  overall  management  of  human  resources  and 
judicial  infrastructure.  Ultimately,  these  reforms  should  lead  to  the  optimisation  of  the 
judicial network and the closure of small, unviable courts. 

It remains a challenge to fully implement instructions for collecting statistical data in a way 
that  is  compliant  with  the  guidelines  of  the  European  Commission  for  the  Efficiency  of 
Justice (CEPEJ). 

The  new  court  information  system  (PRIS)  to  further  modernise  and  reform  the  judicial 
system  is  not  in  place  yet.  Therefore,  it  is  important  to  find  alternative  solutions  and  make 
significant  steps  to  improve  court  statistics  and  to  further  increase  the  efficiency  and 
transparency of the judicial system.  

The  efficiency  of  the  judiciary  is  hampered  by  the  lack  of  effective  systems  for  human 
resources  and  staffing,  financial  resources,  ICT,  proactive  case  management  and 
infrastructure management. There is an urgent need for strategic investment in infrastructure. 
At  all  levels  of  the  judiciary,  the  allocated  working  space  (notably  for  the  Special  State 
Prosecution  Office)  and  working  conditions  in  general  at  all  levels  of  the  judiciary  remain 
inadequate. There is  a lack of specialised judges  and prosecutors and a lack of expertise in 
certain areas. Appropriate ICT infrastructure and equipment in the judiciary is lacking. More 

30 

 
 
efforts are needed to ensure the effective financial independence of the judicial system. 

Domestic handling of war crime cases 

Montenegro continued to implement its 2015 war crime prosecution strategy, but with limited 
results.  To  ensure  effective  implementation  and  monitoring  of  the  strategy,  Montenegro 
needs  to  improve  its  proactive  investigation  and  prosecution  of  war  crimes  in  line  with 
international humanitarian law. The criminal legislation is being amended to address the legal 
and practical obstacles to effectively investigate, prosecute, try and punish war crimes, in line 
with the recommendations of the International Residual Mechanism for Criminal Tribunals.  

During 2022 and 2023, there were no new indictments. The trial of 1 person, against whom 
an indictment was filed in October 2021, is still ongoing before the High Court in Podgorica. 
Between 1 January and 28 December 2022, the Special Prosecution Office (SPO) handled 12 
cases, of which nine are in the investigation phase and one is on trial. In seven of them, the 
preliminary investigation phase is ongoing. During the reporting period, the SPO acted upon 
three  letters  rogatory  for  the  provision  of  international  legal  assistance  that  the  Prosecution 
Office of Bosnia and Herzegovina (two) and the Prosecution Office of the Republic of Srpska 
(one) sent in 2022. The SPO sent three letters rogatory in total, one to the Prosecution Office 
for war crimes of the Republic of Serbia, and two letters rogatory to the Prosecution Office of 
Bosnia and Herzegovina.  

On  16 January 2023,  the  Parliamentary  Committee  on  Political  System,  Judiciary  and 
Administration organised a discussion on the investigation regarding the Lora prison camp in 
Split.  During  the  meeting,  the  Minister  of  Justice  announced  the  revision  of  the  agreement 
between the prosecution services of Montenegro and Croatia on cooperation and prosecution 
of perpetrators of war crimes as it specifies only the obligations of Montenegrin authorities, 
primarily  the  Prosecutor’s  Office,  in  acting  upon  the  request  of  Croatian  investigative 
authorities. 

Montenegro  continued  to  actively  participate  in  the  regional  Missing  Persons  Group  and 
helped  implement  the  framework  plan  signed  in  November  2018.  Cooperation  with 
neighbouring  countries  under  bilateral  cooperation  protocols  continued.  The  list  of  missing 
persons compiled by the Commission on Missing Persons of Montenegro comprises records 
of  51  active  cases  of  Montenegrin  citizens  or  people  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 in the fight against corruption. Limited 
progress  was  achieved.  Corruption,  including  high-level  corruption,  remains  an  issue  of 
concern  and  is  prevalent  in  many  areas,  including  in  state  structures.  Montenegro  has  not 
sufficiently upgraded its legislative and strategic framework  for the prevention of and  fight 
against  corruption  in  line  with  the  EU  acquis,  European  and  international  standards,  for 
which a new strategy  and an accompanying action plan are  required.  Limited progress  was 
achieved  in  preventing  corruption,  and  the  results  of  the  Anti-Corruption  Agency  (ACA) 
improved  in  quantitative  terms.  However,  the  ACA’s  independence,  accountability, 
impartiality,  and  proactiveness  should  be  further  ensured.  The  Law  on  prevention  of 
corruption  should  be  improved  in  line  with  the  existing  recommendations  of  the  2021  peer 
review mission. Montenegro reached a turning point in the investigation and prosecution of 
some high-level corruption cases in 2022. The Special Prosecution Office (SPO) acted with 
alacrity in several high-profile cases. These appear to point to a deep infiltration of corruption 
and organised criminality into state structures, including at the top level of the judiciary and 
law  enforcement.  Montenegro’s  justice  system  needs  to  demonstrate  a  strong,  stringent, 
31 

 
 
coherent and unambiguous criminal  justice  response. Montenegro must further improve the 
track  record  of  investigations,  prosecutions  and  final  verdicts,  including  asset  seizure  and 
confiscation, in the fight against corruption including high-level corruption. A more deterrent 
and  effective  criminal  sanctioning  policy  and  criminal  justice  response  to  corruption 
including high-level corruption is needed to avoid the perception of impunity. The effective 
and systematic use of financial investigations and asset seizure and confiscation needs to be 
improved.  

Efforts  in  this  policy  area  should  primarily  target  those  sectors  that  are  most  vulnerable  to 
corruption, for which a solid risk assessment and dedicated action are required.  

Last  year’s  recommendations  were  only  partially  implemented  and  remain  largely  valid.  In 
the coming year Montenegro should in particular: 

→  adopt an improved the legal, institutional and strategic framework for the prevention of 
and  fight  against  corruption  in  line  with  the  EU  acquis,  European  and  international 
standards,  through  an  integrated  approach,  by  amending  and  effectively  enforcing  the 
Law  on  prevention  of  corruption  and  criminal  legislation,  and  by  addressing  all 
recommendations of the 2021 peer review mission, including on financial investigations 
and  asset  seizure  and  confiscation,  as  well  as  recommendations  from  the  Council  of 
Europe Group of States against Corruption (GRECO) and the Organization for Security 
and Co-operation in Europe (OSCE); 

→  improve  the  track  record  on  corruption  including  high-level  corruption  by  urgently 
strengthening  the  effective  enforcement  of  existing  criminal  legislation  by  prosecution 
services and courts, to impose effective penalties, and take specific measures to improve 
the use of plea bargain agreements in exceptional cases for a more transparent, credible, 
deterrent and consistent criminal justice response; 

→  take action to implement the recommendations of the June 2022 peer review mission on 

the fight against organised crime and high-level corruption. 

Montenegro  did  not  yet  upgrade  the  legal,  institutional,  and  strategic  frameworks  for  the 
prevention  of  and  fight  against  corruption.  In  particular,  it  still  needs  to  adopt  a  new 
integrated  strategy  and  action  plan.  Montenegro  has  yet  to  ensure  inter-institutional 
cooperation  and  coordination  between  all  bodies  involved  as  well  as  coherence  and  a  clear 
description and understanding of their mandates, roles and responsibilities.  

The  recommendations  of  the  2021  peer  review  mission  remain  largely  unaddressed.  The 
mission focused on assessing the legislative and institutional framework for the prevention of 
corruption,  and  on  improving  the  ACA’s  capacity,  performance,  working  methods  and 
results. To comply with many of the peer review recommendations, Montenegro must revise 
the legislative framework, in particular the Law on prevention of corruption, and the Law on 
control of political entities and electoral campaigns in a first instance. Although this process 
has started, the adoption of reforms is still pending.  

Furthermore, the ACA’s efforts to prevent corruption need to be supplemented by a serious 
response  by  law  enforcement,  prosecution  services  and  criminal  justice.  Independent  and 
efficient courts are key to ensuring fair and timely judicial oversight and control of the work 
of the ACA and prosecutors. International cooperation should also be boosted to strengthen 
the national efforts in the fight against corruption, regardless and beyond ad hoc political will 
and affiliation. The ACA’s independence, integrity, impartiality and accountability  have yet 
to  be  further  ensured  and  its  proactivity  and  priority-setting  must  be  improved,  ensuring  a 
non-selective  approach  and  good-quality  decisions,  to  improve  its  track  record  and  results. 

32 

 
 
The ACA’s financial independence has yet to be fully guaranteed.  

Montenegro  has  yet  to  implement  all  recommendations  of  the  evaluation  reports  from  the 
(GRECO),  including  the  fourth  evaluation  round  on  prevention  of  corruption  in  respect  of 
MPs,  judges  and  prosecutors,  and  the  fifth  evaluation  round  on  preventing  corruption  and 
promoting  integrity  in  central  governments  (top  executive  functions)  and  law  enforcement 
agencies. 

Prevention of corruption – legal framework 

Key  shortcomings  identified  in  the  legal  framework  for  the  prevention  of  and  fight  against 
corruption and its effective enforcement have yet to be addressed as described below. In this 
respect,  Montenegro  has  yet  to  address  in  full  the  recommendations  of  the  EU  peer  review 
missions conducted in 2019 and 2021 and of the evaluation reports from GRECO. 

The  Law  on  prevention  of  corruption  (LPC)  has  not  been  amended.  During  the  reporting 
period,  the  lack  of  coordination  and  cooperation  between  all  stakeholders  involved  in  this 
policy  area  was  exacerbated.  Three  processes  to  review  the  LPC  ran  in  parallel.  In  March 
2022, the government  launched a thorough analysis of the LPC for its amendment.  In turn, 
the  ACA,  supported  through  the  EU-Council  of  Europe  Horizontal  Facility,  worked  on  a 
comprehensive  analysis  of  the  LPC,  which  so  far  produced  three  sets  of  recommendations: 
one concerning the position, mandate and powers of the ACA; another one focusing on asset 
declarations, gifts and sponsorships, and on legal mechanisms to prevent conflicts of interest; 
and  a  third  focusing  on  the  provisions  of  the  LPC  related  to  protection  of  whistle-blowers, 
integrity and misdemeanour. Finally, the Anti-corruption Committee of the Parliament took 
an initiative to revise some provisions of the LPC by setting up a working group at the end of 
2022.  The  working  group  completed  its  work  in  late  April  2023,  and  the  Anti-Corruption 
Committee adopted the draft amendments to the LPC, but the plenary vote is still pending.   

Montenegro did not yet improve the legal framework regulating  political parties’ funding, 
partly  due  to  the  lack  of  willingness  on  the  part  of  political  parties  represented  in  the 
Parliament  themselves.  Shortcomings  in  the  existing  legal  framework  on  political  parties’ 
financing  include  those  identified  in  recommendations  of  the  Office  for  Democratic 
Institutions and Human Rights of the Organization for Security and Co-operation in Europe 
(OSCE-ODIHR).  The  current  legal  framework  does  not  provide  for  effective  safeguards 
against and penalties for circumvention of the rules, which limits effective oversight. Limited 
progress  was  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 had been pending since 2014. 
Civil  society  organisations  (CSOs)  are  critical  of  the  lack  of  progress  in  revising  the  legal 
framework for combating corruption in political parties’ financing. In particular, the Law on 
election of Councillors and MPs was not amended, and it must be aligned with the Law on 
financing of political entities and election campaigns. 

Prevention of corruption – institutional framework 

The  ACA  remains  Montenegro’s  key  institution  for  promoting  integrity  and  preventing 
corruption.  In  performing  its  activities,  the  ACA  cooperates  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. 

In  July  2019,  the  President  appointed  the  Anti-Corruption  Council  for  a  four-year  term  of 
office. The Anti-Corruption Council consists of five members and is responsible for decision-
making on the ACA and for the appointment of its Director. The Council’s mandate ended on 

33 

 
 
31 July 2023. 

In November 2022, during the parliamentary debate on the ACA’s 2021 annual report, some 
MPs announced an initiative to dismiss the ACA’s management, questioning its impartiality 
and  accusing  it  of  taking  a  selective  and  biased  approach  in  cases  related  to  the  previous 
political  majority.  Subsequently,  the  Anti-Corruption  Committee  of  the  Parliament  set  up  a 
working  group  to  propose  amendments  to  the  existing  LPC  to  increase  the  Parliament’s 
oversight functions on the ACA and the accountability of the ACA’s management if it acts in 
a  biased  manner.  Under  the  existing  legislation,  only  the  ACA’s  Council  can  dismiss  the 
ACA’s Director. The working group, which started working in early 2023, includes two MPs 
and  two  representatives  of  relevant  CSOs.  Representatives  of  the  parliamentary  opposition 
and  the  Director  of  the  ACA  refused  to  take  part  in  the  working  group.  These  parallel 
initiatives suggest that Montenegro has yet to  ensure leadership and a coherent  approach to 
amending  and  modernising  the  legal  and  institutional  framework  for  the  prevention  of 
corruption in line with European and international standards and best practice.  

The  ACA  currently  employs  53  persons  while  its  organigram  detailing  the  workforce 
envisages a total of 75 posts. Following the 2021 EU peer review mission recommendation to 
allocate additional human resources to the ACA, the government decided in the second half 
of 2022 to employ 14 more staff. A total of seven recruitments are finished, and the rest are 
ongoing.  During  the  reporting  period,  the  ACA  continued  its  communication  activities  and 
collaboration with  CSOs, holding meetings, participating  in  consultations, and attending  10 
conferences organised by civil society. Moreover, in 2022, the ACA held 29 anti-corruption 
training sessions attended by 362 participants. 

Based on the Law on financing of political entities and election campaigns, the ACA checks 
if  legal  entities,  companies,  entrepreneurs,  and  related  natural  and  legal  persons  who 
performed activities of public interest or concluded a contract following a public procurement 
procedure gave contributions to political subjects in the two years before or after the contract 
period.  Montenegro  could  strengthen  prevention  of  corruption  in  the  field  of  public 
procurement and political parties’ financing by fully and efficiently exchanging good-quality 
data,  and  ensuring  the  interoperability  between  the  Ministry  of  Finance’s  e-procurement 
system and the ACA’s electronic system. 

The ACA checks public procurement procedures based on whistle-blower reports related to 
government  bodies,  local  self-government  and  administration  units,  and  public  companies, 
public institutions, and other legal entities whose majority owner or founder is the state or a 
municipality.  In  2022,  the  ACA  initiated  28  procedures  based  on  whistle-blower  reports 
(which is about 14.2% of a total of 188) and 9 procedures that were initiated ex officio. 

the  one  created 

In July  2022, the caretaker government  decided  to  set  up the new National  Council for the 
Fight  against  High-level  Corruption,  replacing 
in  2020.  Beyond 
representatives of different ministries and other relevant bodies, judges and prosecutors, the 
National  Council  also  includes  representatives  of  CSOs,  such  as  NGOs  and  the  Union  of 
Municipalities.  Its  constitutive  session  took  place  at  the  end  of  January  2023.  The  main 
responsibilities  of  the  National  Council  include  preparing,  monitoring  and  reporting  on  the 
implementation of a new strategy for the fight against corruption and related action plans, to 
which  this  body  must  dedicate  thematic  sessions.  Further  responsibilities  of  the  National 
Council  include  the  strengthening  of  inter-institutional  cooperation  on  matters  related  to 
corruption.  The  National  Council  met  twice.  As  of  June  2023,  a  needs  assessment  is  being 
carried  out  under  the  Horizontal  Facility  funded  by  the  EU  and  the  Council  of  Europe  to 
analyse the institutional framework and support the drafting of the strategy. 

34 

 
 
In  December  2022,  a  peer  review  mission  on  the  functioning  of  independent  regulatory 
bodies in the area of fundamental rights took place, assessing the Agency for Personal Data 
Protection and Free Access to Information. The human resources capacity of the Agency 
needs to increase, particularly in the area of free access to information, where in 2022 only 10 
staff dealt with  a caseload of 8 865 complaints (2021:  5 285). Most of the complaints were 
filed  by  only  a  few  physical  persons,  which  could  indicate  an  abuse  of  the  system  for 
financial benefit. The Agency’s Council was not operational until August 2022 and was able 
to solve 3 743 complaints. By the end of 2022, the backlog stood at 5 720. 

Prevention of corruption – track record 

The track record on prevention of corruption continued to improve in terms of the number 
of  cases  dealt  with.  The  ACA  became  somewhat  more  proactive  in  its  work  and  outreach 
activities towards the public, media, and civil society.  

In 2022, the ACA initiated a total of 444 new administrative procedures and completed 423 
procedures  (including  cases  from  previous  years).  In  the  first  quarter  of  2023,  the  ACA 
initiated  28  administrative  proceedings  against  public  officials  (income  and  assets 
declarations  only).  In  2022,  the  ACA  instituted  a  total  of  1 556  proceedings  on  various 
grounds  before  misdemeanour  courts  (2021:  1 164  proceedings),  1 043  proceedings  were 
completed  (including  those  from  previous  years)  and  penalties  were  imposed  in  92.6%  of 
cases.  The  total  amount  of  fines,  including  direct  misdemeanour  orders,  amounted  to 
EUR 103 590  (2021:  EUR 149 242).  In  the  first  quarter  of  2023,  the  ACA  submitted  410 
requests for initiation of misdemeanour proceedings to the misdemeanour courts. 

The  total  number  of  income  and  assets  declarations  submitted  to  the  ACA  on  various 
grounds  further  grew  in  2022,  reaching  11 784  (2021:  10 657).  The  ACA  performed 
administrative  and  technical  checks  on  6 168  reports,  verification  of  accuracy  and 
completeness on 1 742 reports, and additional verification of the reports of 20  high-ranking 
public  officials,  chosen  in  accordance  with  the  degree  of  vulnerability  of  the  area/function. 
Out  of  the  444  administrative  proceedings  the  ACA  initiated  in  2022,  423  were  related  to 
income  and  assets  (2021:  295).  The  ACA  found  violations  of  the  law  in  376  cases  (2021: 
160) and initiated 1 057 misdemeanour proceedings on reports on income and assets (2021: 
1 002). In the first quarter of 2023, the ACA received 9 019 statements on income and assets 
(25% more than in the same period of 2022), which were all administratively and technically 
processed, while the additional verification phase was planned for the second quarter of 2023. 
In the first  quarter of 2023, the ACA initiated 334 misdemeanour proceedings against both 
former and newly appointed public officials, out of which 267 proceedings were completed. 
Penalties were imposed in more than 80% of cases, for a total amount of EUR 21 945. 

During  the  reporting  period,  the  ACA  continued  its  activities  to  inform  and  support  those 
concerned by the obligation to submit reports on income and assets declarations.  

On  incompatibility  of  functions  and  conflict  of  interest,  in  2022,  the  ACA  issued  213 
opinions (14.5% more than in  2021  (186)), leading  to  the resignation of 24 public officials 
(2021:  26),  and  one  termination  of  employment  (2021:  two).  A  further  55  opinions  were 
issued  in  the  first  quarter  of  2023,  leading  to  five  resignations  of  public  officials  and  one 
termination of the service contract. 

In  2022,  the  ACA  continued  monitoring  the  lifestyle  of  public  officials,  using  publicly 
available  data  and  media  reports.  The  ACA  submitted  1  case  to  the  Special  Prosecution 
Office. 

In the last three years, the ACA has initiated 102 administrative proceedings against judges 

35 

 
 
and 39 against prosecutors due to the incomplete reporting of their assets, or incorrect data. In 
January 2023, the Administrative Court decided that the submission of incorrect data related 
to  asset  declarations  and  income  does  not  necessarily  constitute  a  violation.  The  ACA 
challenged this before the Supreme Court and its opinion is pending. 

In  2022,  the  ACA  issued  213  opinions  (2021:  186)  on  incompatibility  of  functions  and 
conflict  of  interest,  leading  to  the  resignation  of  24  public  officials  (2021:  26),  and  one 
termination of employment (2021: two). 

However,  further  work  is  needed  to  effectively  address  the  2021  EU  peer  review 
recommendations on the ACA’s role in dealing with conflict of interest and incompatibility 
of functions, assets declarations and monitoring of lifestyle of public officials. 

Concerning  funding  of  political  parties  and  electoral  campaigns,  the  ACA  oversaw  all 
local elections held in 2022 and the first semester of 2023. Subsequent local elections across 
Montenegro resulted in an unusually long period of election campaigns, increasing the work 
of  the  ACA  in  monitoring  the  application  of  the  Law  on  financing  of  political  entities  and 
election campaigns (LFPEEC). In 2022, the ACA checked 55 604 reports out of the 55 773 
reports submitted by political  subjects,  authorities, and media advertising service providers. 
The  ACA  imposed  measures  to  suspend  the  transfer  of  budget  funds  for  the  financing  of 
regular work on eight political subjects, and a permanent measure of suspension on another 
five.  In  the  first  quarter  of  2023,  the  ACA  received  19 002  reports  submitted  by  political 
subjects, authorities, and media advertising service providers, of which it checked 18 856. 

In 2022, the ACA registered a total of 117 irregularities in the reports of political parties, and 
initiated 439 misdemeanour proceedings for violation of the LFPEEC. Out of 167 complaints 
relating  to  electoral  campaigns  submitted  in  2022,  the  ACA  decided  on  89,  while  other 
procedures  are  ongoing.  In  the  first  quarter  of  2023,  the  ACA  initiated  misdemeanour 
proceedings  for  violation  of  the  LFPEEC  in  69  cases,  and  86  proceedings  were  completed 
(also from previous years). The ACA imposed 10 measures on political entities. It organised 
four  meetings  with  CSOs  on  monitoring,  supervision  and  control  of  electoral  campaigns  in 
the  2022  local  elections.  In  the  first  quarter  of  2023,  Two    such  meetings  were  organised. 
Despite  the  overall  figures,  the  scope  and  therefore  the  impact  of  checks  in  this  important 
area  remain  limited  due  to  the  unclear  or  deficient  provisions  of  the  LFPEEC,  namely 
regarding  the  exemption  of  some  categories  of  political  subjects  from  the  scrutiny  of  the 
ACA. In line with the findings of the 2021 peer review, and in view of the numerous hidden 
arrangements  for  (illegal)  political  party  financing,  further  efforts  are  needed  to  adjust  the 
rules to this volatile environment and make the monitoring of political parties’ financing by 
the ACA and the State Audit Institution effective. 

In  2022,  the  State  Audit  Institution  (SAI)  performed  and  published  audit  reports  on  both 
financial and regularity audits from 2021 for 12 political entities. Regularity audits resulted in 
five qualified, five adverse and two unqualified opinions, while for financial audits the SAI 
expressed nine unqualified, two qualified and one adverse opinion. 

In 2022, the ACA received seven requests for whistle-blower protection (2021: five), three 
of  which  are  still  being  processed.  The  ACA  received  189  reports  on  threats  to  the  public 
interest (2021: 142), out of which 94 were submitted anonymously. The ACA completed 81 
procedures  and  identified  threats  to  the  public  interest  in  five  cases  (2021:  15).  The  ACA 
forwarded 12 reports to the prosecution service, and 34 to other responsible state institutions. 
The  largest  number  of  procedures  initiated  based  on  whistle-blowers’  reports  is  related  to 
labour relations. In the first quarter of 2023, the ACA received 57 whistle-blower reports, a 
significant increase compared with the same period of last years. A total of 28 reports were 

36 

 
 
anonymous. A threat to the public interest was found in 1 of the 12 completed procedures. No 
procedure  was  forwarded  by  the  ACA  to  the  prosecution  authorities,  while  3  reports  were 
forwarded to other responsible institutions. 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 whistle-blowing; the subject  remains covered by the LPC, which is not fully in line 
with the EU acquis. 

On integrity plans, in 2022, 704 reports (2021: 692) on the implementation of integrity plans 
in  2021  were  submitted  to  the  ACA.  In  the  first  quarter  of  2023,  167  reports  on  the 
implementation of integrity plans in 2022 were submitted to the ACA by various authorities. 
By the end of 2022, the ACA had developed a methodology for assessing the application of 
anti-corruption  measures  in  the  judicial  system,  including  an  IT  application  for  its 
implementation.  

On  lobbying,  in  2022,  the  lobbying  register  included  nine  individuals  and  one  legal  entity. 
The  working  group  on  amending  the  Law  on  lobbying  produced  a  first  draft,  which  was 
submitted  to  the  European  Commission  for  its  opinion  in  June  2022.  The  European 
Commission has  shared its recommendations with  the Montenegrin authorities. In February 
2023, the Ministry of Justice adopted a new draft version of the Law addressing most of the 
recommendations.  In  December  2022,  the  working  group  finalised  the  drafting  of  nine 
implementing  acts  meant  to  regulate  the  implementation  of  the  Law  on  lobbying.  The 
working group accepted most recommendations provided by EU experts.  

The Code of Ethics for top executive officials  was adopted in 2021 by the government in 
the form of non-binding guidelines. It remains ineffective as no disciplinary penalties can be 
imposed until the Parliament adopts the Law on government. 

Combating corruption 

The criminal legislation to improve the fight against corruption is being revised in line with 
European standards. The existing legal framework on asset confiscation needs to be reviewed 
and its effective enforcement has yet to be improved substantially, in line with the EU acquis, 
European  standards  and  best  practice.  The  new  draft  law  on  confiscation  adopted  by  the 
caretaker  government  and  submitted  to  the  Parliament  failed  to  address  all  comments, 
recommendations and concerns provided by EU experts and the European Commission. 

The Special Prosecution Office (SPO) leads prosecutions in cases of high-level corruption 
under the leadership of the Chief Special Prosecutor. It currently employs 48 staff, including 
10  Special  Prosecutors.  Of  these  Special  Prosecutors,  1  was  assigned  to  the  Centre  for  the 
Education of Judges and Prosecutors; two are not active anymore but receive compensation 
upon termination of office; two were reassigned from the High State Prosecutor’s Office in 
Podgorica; and two were reassigned from the Basic State Prosecutor’s Office in Podgorica.  

The SPO’s human resources remain largely insufficient to cope with a workload of up to 100 
cases per Special Prosecutor. Furthermore, the office conditions are well below the minimum 
required  European  standards  and  prevent  the  SPO  from  appropriately  and  efficiently 
performing  its  duties.  This  also  creates  security  risks.  Based  on  the  pre-feasibility  study 
prepared by an EU project to address this grave issue, the Ministry of Justice is carrying out 
an internal analysis, with the initial objective of housing the SPO and the Special Police Unit 
on the same premises.  

37 

 
 
The  High  Court  of  Podgorica  is  the  specialised  court  in  charge  of  high-level  corruption 
cases. Currently, the High Court has 34 judges, five of which work in the Special Department 
for Organised Crime, Corruption, Terrorism and War Crimes.  

A  more  deterrent,  consistent,  and  effective  criminal  sanctioning  policy  and  criminal  justice 
response  to  corruption  and  high-level  corruption  has  yet  to  be  enforced,  including  to  avoid 
the  perception  of  impunity.  The  use  of  plea  bargain  agreements  (PBAs)  in  high-level 
corruption cases, when necessary, needs to be clarified and improved in line with European 
standards and practice to avoid abuse during criminal proceedings. PBAs must be resorted to 
with  extreme  care,  only  in  very  specific  cases,  for  the  right  purposes  and  building  in  all 
necessary legal safeguards. When this mechanism is used, a legal cost-benefit analysis in the 
interest of justice should  be carried out systematically. In no case should criminal penalties 
go  below  the  legal  statutory  minimum.  To  improve  the  effective  use  of  PBAs,  guidelines 
need  to  be  drafted  for  specialised  courts  and  prosecution  services;  a  working  group  was 
tasked with preparing this in January 2023. As a precautionary measure, the SPO decided to 
temporarily  suspend  the  use  of  PBAs  in  October  2022  until  the  guidelines  are  adopted  and 
unified in their use.  

The  track  record  of  investigations  and  prosecutions  in  cases  of  high-level  corruption 
improved  but  has  yet  to  be  further  consolidated.  By  contrast,  the  track  record  of  trials  and 
final convictions in these cases is almost non-existent.  

In December 2022, the SPO requested the Parliament to lift the immunity of five MPs as part 
of  a  criminal  investigation  on  suspicion  of  abuse  of  office  related  to  the  allocation  of 
apartments  and favourable housing loans to state officials,  including  to  prosecutors, judges, 
other  MPs  or  Ministers.  In  April  2023,  a  majority  in  the  Parliament  voted  in  favour  of  the 
motion to strip the MPs of their immunity. 

In 2022, the SPO issued orders to investigate criminal offences of high-level corruption in 11 
cases against 76 individuals and five legal entities (2021: 15 cases against 70 individuals and 
19  legal  entities).  Based  on  the  government’s  data,  in  the  same  year,  the  SPO  brought 
six indictments  against eight individuals, and 11 indictments  against 73 individuals  and five 
legal  entities,  an  increase  compared  with  2021  (three  indictments  against  nine  individuals; 
11 indictments  against  68 individuals  and  21 legal  entities).  Financial  investigations  were 
launched  in  five  cases,  against  43 individuals  and  four  legal  entities  (2021:  seven  cases 
against 40 individuals and four legal entities). 

From  15 May  to  10 October 2022,  criminal  charges  were  submitted  to  the  SPO  against 
438 individuals and 21 legal entities. During the reporting period, criminal charges against 80 
of these people were resolved. Against 27 people, decisions were made to dismiss criminal 
charges. Orders to investigate were issued against 52 people, while an order to suspend the 
investigation was made against 1 person. Charges against 129 natural persons and three legal 
entities remain pending. 

Montenegro  has  yet  to  improve  the  legal  approach  to  and  track  record  on  financial 
investigations  and  confiscation  of  assets  linked  to  high-level  corruption.  Montenegro 
should  urgently  address  the  lack  of  expertise  available  in  the  justice  system  on  financial 
investigations.  In  2022,  a  temporary  security  measure  (ban  on  disposing  of  immovable 
property) was imposed in one case against a defendant. The High Court in Podgorica adopted 
temporary  measures  in  two  cases.  In  two  cases  related  to  corruption,  at  the  request  of  the 
SPO,  funds  and  securities  at  banks  were  temporary  blocked.  Between  1 January  and 
22 March 2023, the High Court of Podgorica imposed provisional security measures in three 
new cases. 

38 

 
 
Fundamental rights 

The  legislative  and  institutional  framework  on  fundamental  rights  is  largely  in  place  and 
Montenegro continues to largely meet its international obligations on human rights. However, 
additional efforts are needed to fully implement this framework. Some legislative changes are 
also  needed,  in  particular  in  the  area  of  non-discrimination.  Just  like  the previous  year,  the 
reporting  period  was  marked  by  polarisation  and  division.  The  most  vulnerable  groups  in 
society  (including  Roma  and  Egyptians,  persons  with  disabilities,  LGBTIQ  persons) 
continued to be subjected to discrimination, hate speech and hate crime.  

Additional  efforts need to be made to  ensure access  to  justice and  enforcement of rights  in 
administrative and judicial proceedings, in particular for vulnerable groups. 

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

→  amend  and  adopt  legislation  in  line  with  the  EU  acquis,  European  and  international 
standards  on  domestic  violence,  anti-discrimination,  hate  crimes  and  hate  speech, 
harmonisation of the 2020 Law on same-sex partnership, and data protection; 

→  amend  the  criminal  legislation  in  line  with  the  EU  acquis,  European  and  international 

standards for the protection of fundamental rights and procedural rights; 

→  more  efficiently  protect  fundamental  rights,  in  particular  for  vulnerable  groups,  and 
ensure the harmonised interpretation of European Court of Human Rights case-law and 
European  and  international  human  rights  standards  throughout  the  justice  system, 
including by improving inter-institutional cooperation. 

Montenegro  continues  to  maintain  a  regular  dialogue  and  cooperation  with  international 
human rights organisations and monitoring bodies. Overall, Montenegro fulfils its obligations 
under international human rights instruments and legislation. However, it has yet to ratify 
the  International  Convention  on  the  Protection  of  the  Rights  of  All  Migrant  Workers  and 
Members  of  their  Families,  signed  in  October  2006;  the  2014  Protocol  to  the  1930  Forced 
Labour  Convention;  and  the  2019  Framework  Convention  on  Tourism  Ethics  of  the  UN 
World  Tourism  Organization.  Montenegro  is  late  with  its  submission  of  reports  to  the 
International  Covenant  on  Economic,  Social  and  Cultural  Rights  (due  in  2019),  and  the 
International  Convention  on  the  Elimination  of All  Forms  of  Racial  Discrimination  (due  in 
2021).  Montenegro  did  not  improve  its  systematic  mechanisms  for  reporting  to  the  UN 
human  rights  mechanisms  and  following  up  on  their  recommendations  as  recommended 
during  the  2018  Universal  Periodic  Review  (UPR).  During  its  fourth  UPR  session  on 
8 May 2023, the country received 247 recommendations, out of which it accepted 225, noted 
15,  and  will  determine  its  position  regarding  seven recommendations  by  October.  Most 
recommendations concern gender-based violence, hate speech and hate crime, other forms of 
discrimination, human trafficking, torture and ill-treatment and threats against journalists. 

Montenegro  continues  to  ensure  good  cooperation  with  the  European  Court  of  Human 
Rights (ECtHR). In June 2023, there were 89 applications pending before the ECtHR. The 
ECtHR did not deliver any judgments in respect of Montenegro during the reporting period 
(against 5 in 2022). In the reporting period, 292 new applications were allocated to a decision 
body. Currently, there are no cases under close supervision by the Committee of Ministers. 

Concerning the promotion and enforcement of human rights, institutional capacity has yet 
to  be  further  strengthened,  including  by  allocating  appropriate  funding.  The  role  of  the 
Constitutional Court in providing legal remedy for human rights violations was undermined, 

39 

 
 
due to the Court’s incomplete composition as explained in the judiciary section of this report. 
The  internal  set-up  of  the  Ministry  of  Human  and  Minority  Rights  should  improve  and 
address  all  areas  related  to  fundamental  rights,  including  by  ensuring  the  necessary  human 
resources are in place. Changes in the management and structure of the Ministry introduced 
in  July  2022  undermined  its  capacity  to  promote  fundamental  rights,  enforce  the  legal 
framework, draft new legislation, and implement and monitor existing strategies and policies. 
Key staff responsible for the rights of persons with disabilities and anti-discrimination were 
removed.  

Montenegro has yet to adopt a comprehensive monitoring and data collection system in order 
to assess the level of implementation of human rights legislation, policies, and strategies. 

The Ombudsperson’s Office continues to be perceived as one of the most trusted institutions 
by  Montenegrin  citizens,  and  its  views  are  often  quoted  in  the  media.  The  regulatory  and 
institutional framework for its appropriate functioning is largely in place. It  continues  to be 
accredited with ‘B’ status by the Sub-Committee on Accreditation of the Global Alliance of 
National  Human  Rights  Institutions.  Montenegro  should  take  measures  to  better  align  this 
framework  with  the  Paris  principles  so  that  it  could  be  upgraded  to  an  ‘A’  status.  The 
Ombudsman’s  capacity  to  handle  complaints  and  the  quality  of  its  decisions  continued  to 
improve.  However,  the  decisions  and  recommendations  of  the  Ombudsman  remain  non-
mandatory,  and  Montenegro  needs  to  improve  their  systematic  follow-up  across  all  public 
institutions.  The  draft  2023  budget  for  the  Ombudsperson’s  Office  increased  by  17% 
compared with the 2022 budget. However, this increase is partly due to the November 2022 
government decision on raising the basic salary of certain institutions rather than reflecting an 
increase  in  the  operational  budget.  The  human  resources  capacity  of  the  Ombudsperson’s 
Office appears to be sufficient and stood at 36 employees as of December 2022.  

In  2022,  the  Office  dealt  with  1 109  complaints  (2021:  1 123),  890  of  which  it  received  in 
2022 and 219 of which were transferred from 2021. It closed 979 cases (88.27%) (770 cases 
from 2022 and 209 cases from 2021). Of these, 343 cases were closed for lack of procedural 
requirements and reference to other legal remedies (126 cases were not in the mandate of the 
Office,  108  cases  were  closed  due  to  inadmissibility,  and  109  cases  were  referred  to  other 
legal  remedies).  The  Office  conducted  investigations  in  576  cases:  in  94  cases,  no 
infringement  was  found;  in  327  cases,  an  infringement  was  found,  with  89  infringements 
remedied  in  the  course  of  the  investigation;  and  in  the  remaining  infringement  cases,  the 
Office  issued  opinions  in  238  cases,  with  658  recommendations.  In  86  cases,  the  Office 
pointed  at  failures  of  public  authorities  to  take  preventive  action.  In  2  cases,  it  provided 
recommendations  to  adopt  new  legislation  or  amend  laws  or  regulations.  Most  cases  were 
related  to  violations  of  labour  and  employment  rights,  peaceful  enjoyment  of  property, 
healthcare, right to privacy, right to legal remedy, and environmental protection. In its 2022 
annual  report,  the  Ombudsperson’s  Office  found  shortcomings  in  the  reaction  of  state 
institutions to final court judgments. 

By the end of 2022, the backlog of cases pending before the Constitutional Court included 2 
564 related to  the protection of human rights.  Montenegro must ensure that  the duration of 
proceedings before the Constitutional Court is reduced to guarantee the 2015 ECtHR’s stand 
on the effectiveness of the constitutional complaint as a legal remedy in the country. 

As  regards  the  prevention  of  torture  and  ill  treatment,  on  22 June 2023,  the  European 
Committee for the Prevention of Torture and Inhuman or Degrading Treatment (CPT) called 
upon  the  Montenegrin  authorities  to  investigate  cases  of  police  brutality  and  change  ‘the 
current culture of police impunity’ and warned of poor conditions and severe overcrowding 
in remand prisons in Podgorica and Bijelo Polje in its latest report published in June 2022. In 
40 

 
 
May 2023, Montenegro submitted its report on the follow-up to the UN Committee against 
Torture  (CAT)  concluding  observations  of  May  2022.  Montenegro  is  in  the  process  of 
amending  its  Criminal  Code  and  Criminal  Procedure  Code  to  comply  with  2017  and  2022 
CAT recommendations to align the definition of torture with the Convention, punish acts of 
torture or ill treatment with penalties commensurate with their grave nature, and abolish the 
statute  of  limitations  for  the  crime  of  torture.  On  8 June 2023,  the  government  adopted 
amendments to the Law on legal aid. Under these amendments, victims of torture and other 
forms of ill treatment as well as victims of crimes against sexual freedom and children who 
initiated  proceedings  for  the  protection  of  the  rights  of  the  child  would  be  recognised  as 
privileged  users  of  the  right  to  legal  aid.  The  government  requested  the  European 
Commission’s assessment of the draft amendments to ensure alignment with the EU  acquis 
and European standards, but failed to wait for it. The amendments have not been adopted by 
the Parliament.  

Montenegro  must  step  up  its  efforts  to  conduct  efficient,  effective  and  independent 
investigations  to  address  police  torture,  violations,  and  illegal  use  of  coercive  measures. 
Following evidence of police torture leaked in the press, the Minister of Interior suspended 
four  police  officers  from  the  Unit  for  Special  Operational  Support  accused  of  extorting 
testimony using serious violence. However, no judicial follow-up has been made so far.  

The  National  Preventive  Mechanism  (NPM)  upgraded  its  "Methodology  for  implementing 
the  duties  and  powers  of  the  National  Preventive  Mechanism",  incorporating  the  latest 
international  standards  and practices.  In 2022, the NPM  decided on the remaining  21 cases 
(out of a total of 27) concerning the conduct of police officers during the enthronement of the 
Metropolitan  in  the  Cetinje  Monastery  on  5 September 2021.  It  found  excessive  use  of 
chemical  agents  in  all  cases  and  a  violation  of  Article  3  of  the  European  Convention  on 
Human  Rights  (prohibition  of  torture)  and  Article  28  of  the  Constitution  of  Montenegro 
(dignity and inviolability of persons). Investigations are still ongoing and there are no court 
proceedings  yet.  Visible  identification  markings  (names,  surnames,  number  of  official 
badges,  etc.)  were  introduced  on  police  uniforms  and  protective  helmets  enabling 
identification  and  efficient  investigations,  but  their  use  is  not  systematic.  The  NPM 
determined a violation of Article 3 of the Convention in  one case of abuse in  the women’s 
prison  in  Podgorica.  In  six  cases  related  to  prohibition  of  torture  and  cruel,  inhuman  or 
degrading  treatment  or  punishment  in  the  work  of  the  Police  Administration,  the  NPM 
determined violation of rights in three cases. 

Some  progress  was  made  towards  implementing  the  CPT’s  2019  recommendations  on  the 
prison system  and conditions  of detention.  In July  2022, the government adopted  the  final 
report  on  the  implementation  of  the  action  plan  for  the  implementation  of  the  2017-2021 
strategy for the execution of criminal penalties. On 22 June 2023, the government adopted the 
new  strategy  for  2023-2026  but  its  accompanying  action  plan  for  2023-2024  has  yet  to  be 
adopted.  The  Administration  for  Execution  of  Criminal  Sanctions  (AECS)  initiated  11 
disciplinary  proceedings  for  breaching  official  duty,  but  not  regarding  abuse  of  power  or 
authority in respect of torture or inhuman treatment of people deprived of their liberty. Hiring 
of staff and  capacity building  continued. Prisoners continue to  enjoy  access  to  programmes 
and  occupational  activities.  Parts  of  the  existing  prison  and  remand  facilities  underwent 
adaptation  and  modernisation  to  improve  the  facilities.  Preparations  for  the  construction  of 
the new prison facility in Mojkovac for the north of Montenegro and four facilities in Spuz (a 
special  health  institution,  a  reception,  a  multifunctional  facility,  and  an  open-type  prison) 
continued  and  are  not  finalised.  The  AECS  initiated  activities  to  improve  its  capacity  for 
implementing  occupational  therapy  for  prisoners.  Several  NGOs  provided  educational, 

41 

 
 
recreational and vocational activities for prisoners. In April 2022, there were 605 convicts, 19 
of  which  were  women,  which  is  in  accordance  with  the  available  places.  The  number  of 
detainees is 464, 16 of which are women; 56 are accommodated in the pre-trial detention unit 
in Bijelo Polje and 408 in the overcrowded pre-trial detention unit in Podgorica, which has 
only  292  places.  In  2022,  the  NPM  conducted  40  visits  and  issued  81  recommendations  to 
institutions  and  relevant  ministries,  39  of  which  were  implemented.  The  NPM  received  70 
complaints  from  people  deprived  of  their  liberty  and  found  evidence  of  inhuman  and 
degrading treatment in three cases, related to the poor material conditions of accommodation, 
inappropriate healthcare, and ineffective investigation into allegations of abuse. Despite some 
improvement, the material conditions in prisons, pre-trial detention facilities and psychiatric 
hospitals are still below international standards. Living conditions in the women’s prison are 
decent  and  hygiene  is  satisfactory,  but  in  the  overcrowded  Dobrota  psychiatric  hospital, 
living conditions and hygiene remain poor.  

Montenegro  must  still  adopt  a  new  law  on  personal  data  protection  in  line  with  the  EU 
acquis, the General Data Protection Regulation and the Law Enforcement Directive, and the 
EU Law Enforcement Directive. Subsequently, around 200 laws and implementing acts that 
contain rules  on the processing of personal  data will need to  be harmonised with  both  new 
laws.  Montenegro  has  not  yet  signed  the  2018  Council  of  Europe  Protocol  amending  the 
Convention for the Protection of Individuals with regard to Automatic Processing of Personal 
Data (CETS 223). The human resources capacity of the Agency for Personal Data Protection 
and  Free  Access  to  Information  needs  to  be  strengthened  as  only  63%  of  its  positions  are 
effectively filled. The financial resources of the Agency should match its responsibilities, also 
in  view  of  the  planned  broadening  of  its  tasks,  and  the  Agency’s  financial  independence 
should be guaranteed. The lack of IT expertise in the Agency (with only one supervisor) and 
absence of a digital case management system negatively impact its work. The new tasks and 
powers planned for the Agency in the new draft law will exacerbate the issue of insufficient 
staff. In 2022, the Agency carried out 127 inspections in the field of personal data protection 
(13  control  inspections,  78  inspections  based  on  submitted  initiatives,  and  39  inspections 
based on requests for protection of rights). Following the dismissal of the Agency’s President 
and one member of the Council in December 2021, the work of the Agency was blocked until 
the appointment of a new President and a new Council member in August 2022. 

The state paid more than EUR 1.2 million to ca. 1 000 citizens who had won a lawsuit against 
the state for violating the right to privacy and personal data as well as the right to private and 
family  life  by  publishing  their  names  on  a  list  of  individuals  subject  to  COVID-19  self-
isolation measures in spring 2020.  

In the area of freedom of thought, conscience, and religion, in 2022, the Ministry of Justice 
allocated  EUR 610 581  to  religious  communities,  EUR 585 000  of  which  to  the  Serbian 
Orthodox Church and EUR 30 000 to all other religious communities. In October 2022, the 
premises  of  the  Montenegrin  Orthodox  Church  in  Podgorica  were  stoned.  Also  in  October 
2022,  a  day  before  the  10th  Pride,  the  Serbian  Orthodox  Church  organised  a  religious 
ceremony for the preservation of the sanctity of marriage and family. In November 2022, the 
Basic  State  Prosecutor  opened  an  investigation  into  police  behaviour  during  a  six-hour 
interrogation  of  the  late  Metropolitan  of  Montenegro  and  the  Littoral  Amfilohije  about 
violating  anti-COVID-19  measures  in  June  2020.  In  February  2023,  the  Basic  Court  in 
Podgorica acquitted the Metropolitan of Montenegro and the Littoral Joanikije and 8 Niksic 
priests  of  charges  of  having  acted  contrary  to  the  Health  Ministry’s  orders  to  prevent  the 
spread  of  a  dangerous  infectious  disease  by  organising  a  prayer  walk  in  Niksic  in  2020  in 
which  thousands  of  people  participated.  In  February  2023,  the  Ombudsman  opened  a  case 

42 

 
 
regarding  the  celebration  of  a  Russian  religious  holiday  in  several  schools  in  Podgorica, 
which is forbidden by law.  

---------------------------------------------------------------------------------------------------------------- 

Freedom of expression 

Montenegro has a pluralistic and diverse media landscape and has some level of preparation 
in the area of freedom of expression. Overall, limited progress was achieved. In general, the 
authorities provided prompt and effective law-enforcement and institutional responses to new 
cases  of  violence  against  journalists.  However,  there  was  no  effective  judicial  follow-up  of 
old cases. Despite the commendable practice of extensively involving civil society and media 
stakeholders  in  the  drafting  of  new  media  legislation,  the  government  failed  to  finalise  the 
legislative  proposals  and  present  them  to  the  Parliament.  This  is  now  long  overdue.  The 
authorities need to step up efforts to effectively address the pending recommendations of the 
ad  hoc  commission  for  monitoring  violence  against  the  media,  particularly  regarding 
important old cases. Radio Televizija Crne Gore (Radio Television of Montenegro – RTCG), 
the national public broadcaster, continued to produce politically balanced content, including 
during election periods.  The RTCG must meet  the highest standards of  media integrity and 
accountability.  Further  sustained  efforts  are  needed  to  counter  disinformation  and  limit  the 
effects of online harassment and hate speech without disproportionately limiting freedom of 
expression.  The  media  environment  remains  highly  politically  polarised,  with  uneven 
application  of  the  journalistic  Code  of  Ethics  and  professional  standards.  Credible  and 
effective self-regulation mechanisms have yet to be set up to strengthen media integrity and 
professionalism.  

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

→  provide prompt and effective law-enforcement and institutional protection to journalists 
against all forms of violence, including full and effective judicial follow-up in critical old 
cases; 

→  put  in  place  clear  safeguards  against  any  form  of  undue  influence  on  the  editorial, 
institutional or financial independence of the public broadcaster, the RTCG, which needs 
to abide by the highest standards of professional integrity and accountability; 

→  urgently  complete  the  revision  and  adoption  of  media  legislation  in  line  with  the  EU 
acquis  and  relevant  European  standards,  and  ensure  these  are  introduced  into  the  new 
media strategy. 

Intimidation of journalists 

The  institutional  and  law-enforcement  response  to  address  new  cases  of  violence  against 
journalists and media workers continued to improve. During the reporting period, new cases 
of  violence  received  a  prompt  and  effective  institutional  and  law-enforcement  response. 
However, there was no tangible breakthrough in critical old cases, including the 2004 murder 
of the editor-in-chief of the daily newspaper Dan and the 2018 shooting  of an investigative 
journalist.  In  2022,  the  authorities  registered  22  cases  of  violence  against  journalists, 
involving threats, intimidation, harassment and, in several instances, physical violence. In 13 
of  these  cases,  the  prosecution  authorities  opened  criminal  proceedings.  From  1  January  to 
31 May 2023, the police registered a total of five cases of violence against journalists, one of 
which  was  classified  by  the  prosecution  authorities  as  a  criminal  offence  prosecutable  ex 
officio.  From  1 January 2023  until  31 March 2023,  the  courts  dealt  with  15  cases  of  crimes 

43 

 
 
committed  against  journalists  or  media  property.  The  courts  delivered  judgments  in  eight 
cases,  including  seven  convictions  and  one  acquittal.  In  the  remaining  cases,  criminal 
proceedings are ongoing. 

In  January  2023,  the  Appellate  Court  acquitted  investigative  journalist  Jovo  Martinovic  of 
drug  smuggling  charges.  The  acquittal  came  after  seven  years  of  criminal  proceedings,  in 
which Martinovic received a sentence of one year in prison and spent 15 months in pre-trial 
custody.  

In September, December 2022, and July 2023 the government adopted reports of the ad hoc 
commission  for  monitoring  violence  against  the  media.  The  commission  issued  new 
recommendations with reference to the long-lasting or ineffective investigations into cases of 
violence  against  journalists,  while  also  urging  the  prosecution  authorities  to  provide 
additional information on several cases. The authorities need to address, fully and effectively, 
the  commission’s  pending  recommendations,  particularly  regarding  the  critical  old  cases  of 
attacks on journalists, and to provide the commission with all the necessary means to perform 
its work. In May 2023, the government extended the commission’s term for two more years.   

Instances  of  senior  public  officials  engaging  in  strongly  worded  public  criticism  of  media 
continued to occur. The authorities should promptly react to and publicly condemn all forms 
of  violence  against  media,  whereas  public  officials  should  refrain  from  exercising  political 
pressure on journalists, including through public statements.  

Legislative environment 

The working group tasked with amending the media legislation prepared draft laws on media, 
on audiovisual media services and on the national public broadcaster, the RTCG, through an 
inclusive dialogue with  media and civil society. The government organised a 40-day public 
debate on the three draft laws, which ended in December 2022. However, the adoption of the 
draft media laws was repeatedly delayed. The  government adopted  in  October 2023 a new 
2023-2027 media strategy .  

Implementation of legislation/institutions 

The media environment is pluralistic, but remains highly politically polarised, with generally 
ineffective  self-regulation  mechanisms  and  uneven  application  of  the  journalistic  Code  of 
Ethics  and  professional  standards.  In  2022,  the  Ombudsman  registered  16  cases  of  hate 
speech  and  14 cases  in  the  area  of  public  discourse  and  media,  including  discrimination  on 
the  grounds  of  ethnic  and  gender  identity.  In  October  2022,  the  Council  of  the  Agency  for 
Electronic  Media  awarded  a  national  broadcasting  licence  to  another  Serbian-owned  media 
outlet. In December 2022, the Council appointed a new Director. In August 2022, the Council 
dismissed its former Director, after finding him in  breach of conflicts  of  interest  rules.  The 
Podgorica Basic Court overturned the dismissal as unlawful in a first-instance ruling in May 
2023, which the Council has appealed. 

Public service broadcaster 

The public broadcaster, the RTCG, continued to pursue a balanced editorial policy, providing 
a broad range of political stakeholders with opportunities to present diverse political views on 
all  its  platforms,  including  during  municipal,  presidential,  and  parliamentary  elections.  In 
January 2023, the Podgorica Basic Court overturned the RTCG Council’s decision to appoint 
the public broadcaster’s Director-General as unlawful. In May 2023, this ruling was upheld, 
in second instance, by the Podgorica High Court. In June 2023, the Council reappointed the 
same  person  as  RTCG  Director-General,  causing  a  strong  public  reaction  from  multiple 
CSOs, which accused the RTCG Council of abuse of office and failure to comply with a final 

44 

 
 
and  enforceable  court  decision.  The  prosecution  authorities  opened  a  criminal  investigation 
into  the  case.  An  effective  legal  remedy  in  cases  where  the  Parliament  dismissed  RTCG 
Council members has yet to be provided, either through case-law or through legislation.  

Economic factors 

Because  of  the  relatively  small  size  of  Montenegro’s  economy,  the  advertising  market  is 
limited. This  affects  the  economic sustainability  of media outlets,  leaving them particularly 
exposed to  political  and  corporate interests, both  from  within the country  and from  abroad. 
All  commercial  TV  channels  with  national  broadcasting  licences  are  controlled  by  Serbian 
owners.  The  authorities  continued  to  provide  state  funding  for  content  of  public  interest  in 
broadcast,  print  and  online  media.  They  also  continued  to  provide  state  funding  for  media 
self-regulation, through the Media Pluralism and Diversity Fund, introduced under the 2020 
Media Law. The provisions of the Media Law that aim to ensure the transparency of public 
financing  of  the  media  are  yet  to  be  consistently  and  fully  implemented.  The  long-overdue 
sectoral  collective  agreement  for  the  media  industry  has  yet  to  be  signed,  to  improve  the 
socio-economic position of media workers, providing them with additional rights and benefits 
not covered by the general collective agreement. 

Internet 

Although  rarely  present  in  the  mainstream  media,  hate  speech,  disinformation,  and  hateful 
and insulting personal remarks remained prevalent in the comments sections of online news 
portals and on social media platforms. Multiple online news portals, including certain outlets 
with  considerable readership,  remained unregistered and continued to  breach the applicable 
media  legislation.  The  requirement  under  the  applicable  Law  on  media  to  remove  illegal 
third-party comments from online media platforms should be amended in a manner that does 
not place an undue administrative burden on online media, particularly on smaller services. 

Montenegro does not have a strategy for a better internet for children, including to ease the 
detection of and response to online child sexual abuse.  

Freedom of artistic expression 

Freedom  of  artistic  creation  and  publication  of  works  of  art,  as  guaranteed  by  the 
Constitution, was generally respected, without any notable cases of restriction. 

Professional organisations and working conditions 

In January 2023, one of the national journalists’ associations presented its annual award for 
the best news portal to Sputnik-Serbia.  

Journalists  and  trade  unions  continued  to  report  overall  poor  working  conditions  of  most 
media  professionals,  including  low  salaries,  unpaid  overtime  work,  security  risks,  self-
censorship, and various forms of pressure and undue influence both from media owners and 
third  parties.  Employees  in  local  public  broadcasters  continued  working  in  particularly 
challenging  professional  and  socio-economic  circumstances,  being  directly  exposed  to 
editorial influence and financial control by the local authorities.  

The  very  weak  media  self-regulation  remains  a  matter  of  concern.  The  rare  existing  self-
regulatory  bodies  have  a  limited  impact,  as  even  media  outlets  and  journalists  themselves 
tend to bypass them and take cases against their competitors directly to courts. 

---------------------------------------------------------------------------------------------------------------- 

The rights to freedom of assembly and association remain broadly respected. Of all public 
assemblies,  61%  took  place  with  authorisation  following  prior  notification  to  the  Police 

45 

 
 
Administration. In 2022, four public assemblies resulted in violence or disorder (2021: 21), 
none  of  the  registered  assemblies  resulted  in  the  use  of  police  force,  and  1  protest  was 
temporarily banned by the police due to late notification. Amendments to the Law on public 
assemblies  and  public  events  to  regulate  spontaneous  assemblies  more  precisely  are  still 
outstanding. 

There  was  no  progress  regarding  property  rights.  The  process  of  restitution  of  properties 
expropriated  in  the  past  remained  slow;  some  restitution  cases  have  been  pending  for  19 
years.  The  2020  ECtHR  decision  in  the  ‘Nesic  v.  Montenegro’  case  on  returning  coastal 
property expropriated by the Public Enterprise for Coastal Zone Management of Montenegro 
has not been implemented although the Montenegro Supreme Court ratified it in December 
2020. Montenegro needs to ensure fair restitution proceedings within a reasonable time and 
full  independence  of  the  three  Regional  Restitution  Commissions  (Bijelo  Polje,  Bar  and 
Podgorica). 

There was no progress towards adoption of a new law that would ensure full compliance of 
national legislation with the EU acquis, European standards on anti-discrimination, and the 
2017 recommendations of the European Commission against Racism and Intolerance. 

Societal  polarisation,  misogyny  and  hate  speech  increased.  Vulnerable  groups,  including 
Roma  and  Egyptians,  persons  with  disabilities  and  the  LGBTIQ  community  continued  to 
experience  multiple  forms  of  discrimination  and  challenges  in  exercising  their  equal  rights 
and  were  occasionally  exposed  to  hate  speech  and  hate  crime.  There  is  an  urgent  need  to 
effectively  address  all  forms  of  discrimination  by  using  legal  protection  mechanisms. 
People’s  acceptance  of  and  respect  for  pluralism  in  society  needs  to  be  stimulated  from  an 
early age through engagement with young people and adults to promote behavioural changes 
and tolerance of diversity. According to a December 2022 Center for Democracy and Human 
Rights survey on discrimination, 67% of respondents (2020: 57%) believe that discrimination 
is  present  in  Montenegro  and  mainly  on  the  ground  of  political  belief.  In  2022,  the 
Ombudsperson’s  Office  received  256  complaints  of  discrimination,  an  upward  trend 
compared  with  2021  (173).  This  may  imply  that  trust  in  the  work  of  the  Ombudsman  is 
growing,  or  that  potential  victims  are  more  empowered  to  report  discrimination.  As  in 
previous  years,  most  complaints  were  related  to  labour  and  employment.  In  2022,  the 
Ombudsman processed 16 cases of hate speech and 14 cases in the field of public discourse / 
media. The Ombudsman established hate speech based on social or ethnic origin in one case; 
based on sex, change of sex and gender identity in  three cases;  based on nationality  in two 
cases; and based on political or other opinion in one case. In the area of public discourse, the 
Ombudsman established discrimination based on nationality in one case; based on social or 
ethnic  origin  in  one  case;  and  based  on  political  or  other  opinion  in  one  case.  The  2017 
priority recommendation of the European Commission against Racism and Intolerance to put 
in  place  a  system  for  collection  of  disaggregated  data  on  hate  crime  has  still  not  been 
implemented as this depends on the pending amendments to the Criminal Code. 

On  gender  equality,  limited  progress  was  achieved.  The  implementation  of  the  2021-2025 
national  strategy  continued.  However,  Montenegro  must  address  the  issue  of  gender-based 
violence  and  domestic  violence  by  amending  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. 

Women  remain  under-represented  in  political  and  economic  decision-making.  In  the  new 
Parliament, out of 81 MPs in total, only 17 are women, which represents a slight reduction 
compared with the previous Parliament, which had 18 women MPs. Women make up only a 
quarter of the public administration’s total management, often due to explicit or implicit bias 
46 

 
 
in hiring, training, and promotion practices. Smear campaigns, hate speech and use of gender-
based violence against women in politics and public life still persist although the number of 
cases fell slightly. 

The  2023-2024  action  plan  of  the  2021-2025  national  strategy  for  gender  equality  is  under 
preparation. There is an urgent need to effectively address deeply rooted societal behaviour 
that  degrades  and  discriminates  against  women,  resulting  in  instances  of  gender-based 
violence. 

The  Ministry  of  Human  and  Minority  Rights  started  to  cooperate  closely  with  the  public 
broadcaster RTCG, and organised training courses on gender-based hate speech, sexism and 
misogyny for journalists and RTCG employees.  

Gender-based  violence,  in  particular  domestic  violence,  remains  a  serious  and  persistent 
issue and the most extreme manifestation of gender inequality in Montenegro. Despite a solid 
legal  framework,  there  is  a  lack  of  systemic  gender  responsiveness  and  women-friendly 
procedures for victims of violence. Limited specialisation of justice, social, health and police 
professionals  dealing  with  gender-based  violence  and  violence  against  women  remains  a 
challenge. The investigative and judicial practice remained very lenient, enforcing only some 
protective measures in misdemeanour proceedings and imposing very few security measures 
in  criminal  proceedings.  Such  practice  is  not  in  line  with  international  standards,  above  all 
with  the  practice  of  the  ECtHR,  which  requires  state  authorities  to  implement  proper 
investigation  in  case  of  domestic  violence  and  to  take  measures  for  appropriate  criminal 
prosecution. In the reporting period, of all imposed misdemeanour penalties, fines made up 
one  third  (32,  i.e.  36%)  and  suspended  sentences  one  fifth  (21,  i.e.  6%),  while  prison 
sentences are still rarely imposed (10%). 

Women’s  associations  remain  an  important  factor  in  supporting  victims  of  gender-based 
violence  and  in  organising  various  training  sessions  and  awareness-raising  campaigns. 
However, these organisations are facing constant financial constraints.  

In August 2022, the Ministry of Labour and Social Welfare set up the Directorate for Gender 
Based  Violence,  which  is  an  important  milestone  in  developing  a  proper  institutional 
infrastructure  to  enable  appropriate  implementation  of  the  Istanbul  Convention  and  to  give 
due  attention  to  monitoring  and  advancement  of  the  protection  and  prevention  systems. 
However, Montenegro should allocate appropriate funding to the Directorate, to ensure it is 
fully operational, as it is currently unable to provide efficient and appropriate support. 

In December 2022, the Gender Equality Committee hosted the 15th session of the Women’s 
Parliament, on the topic of combating violence against women, as part of the campaign ‘16 
days of activism against gender-based violence’. 

Crisis centres and clear protocols for victims of sexual violence have not been created yet. 

In  the  area  of  rights  of  the  child,  the  legislative  and  institutional  framework  is  largely 
aligned with  international  human rights  instruments,  including  all areas covered by the UN 
Convention on the Rights of the Child and its optional protocols. However, challenges remain 
in  effective  implementation  due  to  a  poor  accountability  framework,  inappropriate  and 
insufficient capacity, lack of systematic monitoring and sufficient funding, and lack of quality 
assurance of existing laws, strategies, and action plans. The systematic collection of reliable 
and  comparable  data  disaggregated  by  age  and  sex  is  essential  for  setting  evidence-based 
policy priorities and ensuring effective protection of children. 

In July 2022, the government set up the Council for the Rights of the Child for the first time 
at  Prime  Minister  level.  However,  its  inaugural  session  took  place  only  on  13 March 2023, 

47 

 
 
when it adopted an action plan for 2023-2024. On 26 May 2023, the Council adopted specific 
measures  the  government  must  implement  in  2023  to  prevent  cases  of  violence  among 
children, adolescents and young people. Montenegro must step up its efforts to monitor the 
implementation of the national strategy on exercise of child rights (2019-2023), evaluate its 
impact and prepare the fourth periodic report to the UN Committee on the Rights of the Child 
due by November 2023.  

In 2022, the Ombudsman received 225 complaints related to rights of the child (2021: 216). 
These cases were predominantly related to education, social and child protection, healthcare, 
rights  of  children  in  family  relationships,  peer  violence,  as  well  as  rights  of  children  with 
disabilities.  Besides  an  increase  in  domestic  violence,  peer  violence  at  school  remains  an 
alarming  trend.  Child  access  to  justice,  in  particular  of  vulnerable  groups,  has  yet  to  be 
improved, and child-friendly proceedings for all children in contact with the law have yet to 
be  ensured.  This  refers  both  to  children  in  criminal  proceedings  (child  offenders,  child 
victims and children witnesses) and to children in proceedings related to civil or family law 
and misdemeanour proceedings. There was no progress  regarding the follow-up on the UN 
monitoring  bodies’  recommendations  and  on  Resolution  1468  of  the  Council  of  Europe 
Parliamentary Assembly to amend the Family Law and raise the minimum age for entering a 
marriage to 18 years. The practice of arranged child marriages, in particular among the Roma 
and Egyptian communities, remains a matter of serious concern. MONSTAT’s 2021 survey 
on income and living conditions, published in December 2022, shows that every third child in 
Montenegro lives at risk of poverty. 

There is  no satisfactory  level  of protection of children from  perpetrators  of sexual  offences 
and there is still a lack of systematically collected disaggregated data on child sexual abuse 
and  sexual  exploitation.  The  strategy  for  the  prevention  and  protection  of  children  against 
violence and its action plan expired in 2021 and have yet to be updated. The current Criminal 
Code  envisages  tightening  the  penal  policy  regarding  crimes  of  child  sexual  abuse  (in  line 
with the recommendations of the Lanzarote Convention), drawing up a register of offenders 
and surveillance measures against perpetrators after their time in prison. However, these new 
rules  are  not  implemented  due  to  the  lack  of  implementing  legislation.  In  2022,  the  Police 
Directorate registered 23 criminal acts of child sexual abuse (three related to rape, five were 
qualified  as  child  molestation,  11  related  to  illicit  sexual  acts,  and  four  related  to  child 
pornography). The Criminal Code is yet to be revised to fully comply with the Convention on 
the  Rights  of  the  Child  and  its  First  Optional  Protocol  (on  the  sale  of  children,  child 
prostitution,  and  child  pornography)  and  legislation  needs  to  address  online  child  sexual 
exploitation.  The  National  SOS  Children’s  Line  restarted  operating  in  autumn  2022  after  it 
had been inactive due to lack of funding. However, its working hours were shortened to eight 
working  hours  per  day  from  the  previous  24/7  schedule  due  to  lack  of  resources,  both 
financial and human. Montenegro needs to take the necessary steps to ensure that all children 
are registered systematically in birth registers. 

In December 2022, the number of children living in institutional care was 110, slightly lower 
than in February 2022 (115). The drafting of a national strategy on deinstitutionalisation has 
been slow and organisations of persons with disabilities are not involved in the process. 

Regarding  the  rights  of  persons  with  disabilities,  there  was  no  progress.  Persons  with 
disabilities  in  Montenegro  cannot  fully  exercise  their  rights  and  continue  facing  multiple 
forms of discrimination. In July 2022, the Ministry of Human and Minority Rights abolished 
the  Directorate  for  the  Protection  and  Equality  of  persons  with  disabilities.  Montenegro 
should set up such a directorate again or assign the relevant responsibilities to another service 
to oversee the implementation of the 2022-2027 strategy for protection from discrimination 

48 

 
 
of  persons  with  disabilities  and  promotion  of  equality  and  its  action  plans  for  2023. 
Montenegro has yet to adopt the draft law on a unified disability assessment body, which will 
be the basis for reforming the system to bring about more just, more equal and easier access 
to  rights,  enabling  a  shift  from  a  medical  to  a  human  rights-based  model.  A  decision 
allocating premises for the future institute for disability determination is pending the adoption 
of the draft law on a unified disability assessment body. 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. The National  Council for 
the rights of persons with disabilities, the entity in charge of monitoring the implementation 
of all laws and strategies to promote rights and to support better coordination on disability, is 
not  functional.  In  May  2023,  the  Ombudsperson  Office  established  an  independent 
monitoring mechanism under the Convention on the Rights of Persons with Disabilities. The 
recommendations of the UN Committee on the Rights of Persons with Disabilities from 2017 
are  not  fulfilled,  especially  regarding  the  necessary  reform  of  guardianship  and  decision-
making on behalf of persons with disabilities. Montenegro has not adopted an action plan to 
implement the Committee’s recommendations. Some definitions of disability in Montenegrin 
legislation use derogatory terminology. On 7 December 2022, the Higher Court in Podgorica 
confirmed an earlier judgment of the Basic Court in Podgorica, which found that a person had 
suffered repeated disability-related discrimination by the Social Work Centres of Kotor, Tivat 
and  Budva  and  the  State  of  Montenegro.  This  is  the  first  final  judgment  in  Montenegro 
regarding  the  protection  of  persons  with  disabilities  from  discrimination  in  access  to 
information and in proceedings before authorities. 

There  was  no  progress  regarding  the  protection  of  the  rights  of  lesbian,  gay,  bisexual, 
transgender,  intersex,  and  queer  (LGBTIQ)  persons.  Several  attacks  on  offices  of 
LGBTIQ NGOs and private apartments of LGBTIQ activists during the reporting period as 
well as many incidents of hate speech against LGBTIQ persons including on social media are 
a matter of concern. As a result of the July 2022 reorganisation of the Ministry of Human and 
Minority  Rights,  the  responsibility  for  promoting  and  protecting  the  rights  of  LGBTIQ 
persons is not allocated to any specific service. The law on legal gender recognition is yet to 
be  adopted.  In  October  2022,  the  10th  Podgorica  Pride  took  place  with  the  participation  of 
several ministers and without any incidents. There was no progress in harmonising relevant 
implementing  legislation  with  the  Law  on  same-sex  partnerships.  In  2022,  the  Ministry 
allocated EUR 250 000 to LGBTIQ NGOs, 43% more funds than in 2021 (EUR 174 904). In 
2022, the courts for misdemeanours processed 76 cases of discrimination or other forms  of 
attack on LGBTIQ persons.    

The  amendments  to  the  Criminal  Procedure  Code  and  the  Criminal  Code  to  fully  align 
criminal  legislation  with  the  EU  acquis  and  European  and  International  standards  on 
procedural rights for suspects and accused persons in criminal proceedings, and victims of 
crime  are  being  drafted  with  the  support  of  EU  expertise.  The  amendments  aim  to  tackle 
provisions on the right to information, the right to be present and participate at all stages of 
the proceedings, unjustified prolonged pre-trial detentions, insufficient protection of victims, 
in particular women and children, as well as the overall length of proceedings. Montenegro 
has  yet  to  adopt  a  law  on  the  procedural  safeguards  for  children/juveniles  in  criminal 
proceedings.  Comprehensive  data  on  free  legal  aid  is  lacking  as  it  depends  on  the 
development  of  the  new  judicial  information  system.  In  2022,  the  budget  allocated  and 
implemented to legal aid amounted to EUR 108 776 (2021: EUR 121 500).  

Amendments  to  the  Law  on  protection  against  domestic  violence  are  not  in  place.  A 
systematic approach to dealing with and providing information to victims is still lacking. A 

49 

 
 
national  strategy for the  protection of victims’ rights  is  under preparation. Montenegro still 
needs  to  stop  the  suspension  of  the  Law  on  victims’  compensation  and  secure  sufficient 
funding for victims’ support. 

Regarding  the  rights  of  persons  belonging  to  minorities,  in  December  2022,  Montenegro 
submitted  its  sixth  report  on  the  implementation  of  the  European  Charter  for  Regional  or 
Minority  Languages  and  its  fourth  report  on  the  implementation  of  the  Framework 
Convention for the Protection of National Minorities.  In September 2023, the Committee of 
Experts  of  the  European  Charter  for  Regional  or  Minority  Languages  published  its  seventh 
monitoring report on Montenegro, noting that shortcomings remain for the adequate use and 
protection of the Romani language in line with European standards and legislation.  In April 
2023,  the  report  on  the  implementation  of  the  2022  action  plan  to  implement  the  minority 
policy strategy for 2019-2023 was adopted, while the 2023 action plan was adopted in May 
2023.  There  is  still  no  equal  treatment  of  minorities  in  the  Parliament.  Data  on  the 
implementation of the 2019-2023 minority policy strategy is not available. In July 2022, the 
Ministry of Human  and  Minority Rights  set  up a new  Directorate  for the advancement  and 
protection  of  the  rights  of  minority  nations  and  other  minority  communities.  In  2022,  the 
Ministry  allocated  EUR 150 000  to  NGOs  working  on  rights  of  persons  belonging  to 
minorities. In November 2022, the Fund for the Protection and Realisation of Minority Rights 
allocated more than EUR 1 million to 195 organisations and individuals for the promotion of 
rights  of  persons  belonging  to  minorities.  In  August  2023,  the  Special  Prosecution  Office 
opened  a  criminal  investigation  into  the  financial  management  of  the  Minority  Fund.  In 
March  2022,  the  Ombudsman  issued  an  opinion  to  the  Ministry  regarding  possible 
amendments  to  the  Law  on  minority  rights  and  freedoms  to  ensure  direct  appointment  in 
Minority Councils based on the freely expressed will of minority nations and other minority 
national communities. 

Roma  and  Egyptians  remain  the  most  vulnerable  and  antigypsyism  remains  a  problem. 
There  were  no  developments  regarding  the  reduction  of  the  threshold  for  political 
representation of Roma in the Parliament, as the Law on the election of Councillors and MPs 
was  not  amended.  On  6 April 2023,  the  Parliamentary  Committee  for  human  rights  and 
freedoms  in  cooperation  with  the  Ministry  of  Human  and  Minority  Rights  and  the 
Ombudsman organised the first sitting of the Roma Parliament. The Roma Council boycotted 
the  sitting.  On  19 October 2022,  the  government  organised  the  third  Roma  ministerial 
meeting in  Podgorica.  The Ministers  of all Western Balkan countries responsible for Roma 
inclusion  agreed  to  act  upon  the  commitments  made  in  Poznan  in  2019  and  the  first  two 
ministerial  meetings  organised  in  Tirana  (2020)  and  Sarajevo  (2021).  They  also  agreed  to 
strengthen the ongoing work on Roma integration in the areas of housing, employment, green 
and  digital  agendas,  and  Roma  responsive  budgeting,  and  to  adopt  strong  monitoring  and 
reporting systems to measure progress on implementation of the new Roma strategies and the 
Poznan Declaration objectives with the assistance of the national statistical offices. 

On 2 November 2022, the government appointed its national Roma contact point (NRCP), a 
position  vacant  since  August  2020.  The  NRCP  comes  from  the  Roma  community  and  is  a 
long-term  employee of the Ministry. However, the NRCP does not  have a decision-making 
role  in  the  Ministry  and  its  limited  capacity  and  resources  remain  major  weaknesses.  On 
26 May 2023,  the  government  adopted  a  Decision  on  the  establishment  of  the  coordination 
body for monitoring the implementation of Poznan Declaration commitments, chaired by the 
NRCP. 

In 2022, 26 civil society organisations received public funds to implement projects in the area 
of Roma inclusion. In addition, in 2022, the Minority Fund supported 10 projects in the area 

50 

 
 
of  Roma  inclusion.  The  budget  allocated  for  projects  supporting  Roma  inclusion  is 
increasing, but appropriate planning, monitoring and financial control are lacking. 

In the 2022/2023 school year, 202 Roma children attended preschool education (92 boys and 
110  girls),  1 833  attended  primary  school  (950  boys  and  883  girls),  and  214  attended 
secondary school (122 boys and 92 girls). Currently, there are 14 Roma university students. 
There  is  an  increase  in  the  number  of  Roma  education  mediators  working  in  various 
municipalities, 30 of whom are supported by the Ministry of Education. The legal framework 
still  does  not  sufficiently  support  the  enrolment  of  Roma  students  in  higher  education. 
Although Montenegro provides scholarships of EUR 150 per month, there are no additional 
incentives.  Overall,  the  quality  of  education  of  Roma  children  remains  an  area  of  great 
concern. 

In 2022, the Ombudsman conducted a field survey in Roma settlements in 13 municipalities. 
Preliminary findings show that Roma and Egyptians live in less segregated settlements than 6 
or  7 years  ago,  but  42.2%  of  Roma  still  live  in  settlements  populated  only  by  Roma.  The 
problem of overcrowding in Roma households persists, with slight improvements in terms of 
access to water, power supply, and possession of basic appliances. 

The  country  does  still  not  systematically  address  child  begging  and  child  marriages,  and 
neither  does  it  take  sufficient  steps  to  fulfil  its  pledges  to  address  statelessness  as 
recommended  by  the  United  Nations  High  Commissioner  for  Refugees  (UNHCR).  The 
Romani language is underused and not taught in schools. 

Regarding  displaced  and  internally  displaced  persons,  from  7 November 2009  to  1  June 
2023,  there  were  15 271  requests  for  permanent  or  temporary  residence.  Of  these,  15 159 
requests  were  resolved,  and  112  cases  are  still  pending.  A  total  of  12 410  people  received 
permanent  or  temporary  residence  up  to  three  years,  297  requests  were  refused,  and  2 448 
cases were suspended due to incomplete or duplicated requests. 

Between  the  entry  into  force  of  the  new  Law  on  foreigners  in  2018  and  March  2023,  nine 
people were recognised as stateless, while for 17 the procedure for determining statelessness 
is ongoing. Montenegro has yet to adopt amendments to the Law on foreigners to strengthen 
the  statelessness  determination  procedure,  primarily  regarding  procedural  guarantees  and 
access  to  rights  during  the  procedure  and  upon  recognition  of  stateless  status.  This  is  a 
concern. 

According  to  the  UNHCR,  there  are  currently  around  500  people  at  risk of  statelessness  in 
Montenegro.  Through  close  cooperation  between  the  Ministry  of  Interior  and  the  UNHCR, 
the  new  birth  registration  practice  for  this  specific  group  of  people  yielded  results:  the 
Ministry  of  Interior  completed  birth  registration  of  all  stateless  children  in  Montenegro 
known  to  the  UNHCR  and  continuously  strengthens  the  birth  registration  procedure.  The 
public  consultation  regarding  the  amendments  to  the  Law  on  foreigners  and  statelessness 
determination  procedure  in  Montenegro  was  completed.  The  Ministry  of  Interior  proposal 
would  grant  the  right  to  initiate  the  statelessness  determination  procedure  to  a  person  with 
habitual residence in Montenegro of at least three years before the initiation of statelessness 
determination  procedure,  or  whose  family  members  are  citizens  of  Montenegro,  or  to 
foreigners  with  permanent/temporary  residence.  According  to  the  UNHCR,  access  to 
statelessness  determination  procedure  remains  an  issue  of  serious  concern,  as  it  limits  the 
fairness of the process and is seen as not being in line with 1954 Statelessness Convention.   

On citizenship rights, the investor citizenship scheme expired on 31 December 2022. There 
should be no further scheme. Pending applications should be thoroughly screened, as should 
the  origin  of  funds  generated  by  the  scheme,  for  which  no  Montenegrin  body  has  taken 
51 

 
 
responsibility. 

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. Limited progress was achieved, 
by  starting  to  address  the  critical  lack  of  human  resources  for  border  management,  taking 
initial  steps  to  align  the  visa  policy  with  the  EU’s  list  of  visa-required  third  countries,  and 
earmarking  state  funds  to  increase  the  accommodation  capacity  for  migrants.  However, 
overall, last year’s recommendations remain largely valid.  

In the coming year, Montenegro should in particular:  

→  limit  the  use  of  plea  bargains  to  exceptional  cases,  to  further  increase  the  transparency 
and credibility of the judicial response to organised crime through a more deterrent  and 
consistent sanctioning policy; 

→  align  the  legal  and  operational  approach  to  financial  investigations,  asset  seizure  and 
confiscation and the fight against money laundering with EU and international standards, 
and establish a convincing track record in these areas;  

→  further  strengthen  border  management  capacity  by  addressing  critical  gaps  in  border 
surveillance  equipment;  take  the  necessary  steps  to  set  up  an  Advance  Passenger 
Information  System  and  a  biometric  migrant  registration  system;  further  align 
Montenegro’s visa policy with the EU’s list of visa-required countries, in particular with 
regard  to  countries  presenting  irregular  migration  or  security  risks  to  the  EU;  take 
measures to further address the protection needs of migrants and increase administrative 
capacity in the area of returns. 

Fight against organised crime 

Montenegro  is  in  between  some  and  moderate  level  of  preparation  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.  Montenegro  increased  the 
number of investigators and experts in key areas, such as financial investigations, cybercrime 
and special investigative measures. 

Montenegro implemented an ambitious human resources reform of the police: it created new 
posts,  set  up  new  units  and  recruited  new  staff.  Prominent  members  of  organised  crime 
groups  were  arrested,  along  with  some  top-level  officials  from  law  enforcement  agencies, 
pointing to a deep infiltration of organised crime into state structures. However, there was no 
final court decision on organised crime in the areas of tobacco smuggling, money laundering, 
trafficking  in  human  beings  or  cybercrime.  The  track  record  in  final  asset  confiscation 
remained very limited. Montenegro has yet to address some systemic shortcomings affecting 
its  criminal  justice  system  across  the  board,  including  the  way  organised  crime  cases  are 
handled in courts.  

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

→  continue  increasing  the  efficiency  of  criminal  investigations  by  setting  up  a  fully 

52 

 
 
functional  interoperable  system  with  a  single  search  feature  and  a  case  management 
system shared between prosecutors and investigators; 

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

→  address the risks of corruption and infiltration of organised crime into law enforcement 
agencies and the judiciary by implementing a strong prevention policy and providing a 
stringent judicial response to detected cases.  

Institutional set-up and legal alignment 

The  number  of  police  officers  fell  to  3 980  in  2022  (from  4 586  in  2021).  A  total  of  375 
officers  retired  and  105  administrative  staff  moved  to  the  Ministry  of  Interior.  The  ratio  of 
police officers remains high, at 639 per 100 000 inhabitants, compared with an EU average of 
335.3  per  100 000  inhabitants  (Eurostat,  2019-2021).  However,  unlike  most  EU  Member 
States, Montenegro counts border guards as police officers (1 540 staff members), as well as 
non-operational staff such as advisers and officers without police rank.  

Montenegro  continued  to  work  on  amendments  to  its  legal  framework  for  the  fight  against 
organised  crime,  often  with  EU  expert  support,  to  align  it  with  the  EU  acquis  and  address 
existing loopholes. However, in most cases, adoption of the legislation is still pending. The 
draft amendments  to  the criminal  code,  that are  needed  to  align it with  the EU  acquis on  a 
large range of topics, such as trafficking in human beings and anti-money laundering, are still 
pending adoption. 

Montenegro  has  yet  to  adopt  the  amendments  to  the  Law  on  seizure  and  confiscation  of 
material  benefit  derived  from  criminal  activity,  drafted  to  address  legal  obstacles  to  the 
confiscation  of  criminal  assets.  In  February  2023,  the  government  adopted  a  first  version, 
which  did  not  take  into  account  the  European  Commission’s  comments.  Eventually,  a 
working group was set up to review the draft.  
In December 2022, the Parliament adopted amendments to the Law on internal affairs relating 
to  the  conditions  of  retirement  of  police  officers.  It  also  adopted  one  amendment  to  the 
existing  Law  on  games  of  chance  and  prize  competitions,  with  the  limited  objective  of 
introducing  a mandatory audio-visual surveillance system  for games of chance, but  without 
addressing any of the other issues with the current law. 

The Central Bank of Montenegro has a central register of resident accounts, but still does not 
have  a  register  of  non-resident  accounts,  a  crucial  tool  for  investigations  involving  non-
residents. Montenegro did not address the problem of the incomplete and not fully digitalised 
land  cadastre,  which  hampers  the  conduct  of  financial  investigations,  the  confiscation  of 
assets,  and  the  implementation  of  internal  penalties.  A  centralised  database  on  organised 
crime and corruption cases, containing data collected from all relevant authorities is needed 
for reporting, monitoring and policymaking purposes. 

In  the  area  of  firearms,  a  revised  Law  on  weapons,  aimed  at  aligning  rules  on  marking  of 
firearms and technical specifications with EU standards e, has been pending adoption by the 
Parliament for two years. Adoption of the law was not on the parliamentarian agenda during 
the reporting period. 

In  the  area  of  trafficking  in  human  beings,  the  revision  of  the  criminal  code  is  needed,  to 
align it with the EU acquis. 

Montenegro  increased  the  budget  allocated  to  the  Special  Prosecutor’s  Office  (SPO)  by 
53 

 
 
EUR 2 million.  A  total  of  20  new  posts  were  created  for  administrative  staff  and  IT  and 
financial  experts,  bringing  the  number  of  posts  for  support  staff  to  55.  Recruitments  are 
ongoing.  However,  the  number  of  Special  Prosecutors  (11,  including  the  Special  Chief 
Prosecutor) remains insufficient to cope with the SPO’s heavy workload. Special Prosecutors 
handle up to 100 organised crime or high-level corruption cases each. This is due to the very 
broad description of the SPO’s mandate in the law, which includes smaller and simpler cases, 
which  could  be  handled  by  other  prosecution  services.  Some  thematic  specialisation  of 
Special Prosecutors was introduced. In September 2022, the government adopted a decision 
to transfer the SPO (together with the State Supreme Prosecutor and the Special Police Unit) 
to  another  government  building,  to  address  its  current  precarious  housing  and  security 
conditions.  However,  the  SPO’s  removal  can  only  take  place  after  the  necessary 
refurbishment. 

In  March  2023,  a  police  development  strategy  for  2023-2026  was  adopted.  An  ambitious 
human resources reform of the police was implemented in 2022. Further to the adoption of a 
new  rulebook  on  internal  organisation  of  the  Ministry  of  Interior  and  the  police  in  August 
2022,  239  new  posts  were  added  to  the  Directorate  for  the  fight  against  organised  crime, 
either  through  internal  transfers  of  posts  from  other  Directorates  or  through  the  creation  of 
new posts. The unit in charge of special investigative methods benefited the most from this 
increase, with an increase in posts from 72 to 121. The number of Special Police Unit posts 
rose  from  32  to  50.  A  new  unit  in  charge  of  financial  investigations  and  the  fight  against 
corruption  and  economic  crime  was  created.  The  number  of  posts  in  the group  for  fighting 
drug smuggling rose to 25. In the area of firearms, a specialised team was created, with 8 job 
positions dedicated to the investigation of firearms smuggling offences. However, only 50% 
of  the  new  posts  have  been  filled  so  far.  For  some  posts,  a  10  to  20%  salary  increase  was 
introduced, to attract and retain more specialised profiles in the police.  

At the same time, the government did not adopt a human resources plan, which is required by 
the  Law  on  public  administration  and  has  been  ready  for  adoption  since  2020.  Because  of 
this, the appointment of all five Deputy Police Directors and other senior positions is blocked. 
The Deputy Police Directors have been in an acting position for three years.  

In March 2023, the Deputy Police Director in charge of the fight against organised crime was 
arrested on the Special Prosecutor’s order on suspicion of having collaborated with organised 
crime  groups  between  2018  to  2020.  This  prompted  a  major  reshuffle  in  the  police.  On 
30 March 2023,  the  government  dismissed  the  Police  Director,  who  had  been  in  function 
since  August  2021.  He  was  replaced  by  the  Chief  of  Budva’s  regional  police  branch.  The 
decision  was  not  taken  in  accordance  with  the  rule  on  dismissal  of  Police  Directors,  which 
provides that the dismissal of Police Directors is triggered by the Parliament’s Security and 
Defence  Committee,  and  not  by  the  government.  The  former  Police  Director  lodged  a 
complaint  against  the  decision  of  the  government  with  the  Administrative  Court  of 
Montenegro.  

At  the  same  time,  a  large-scale  reshuffling  of  heads  of  units  and  middle  managers  in  the 
Criminal Police Directorate was launched. Some 19 new heads of regional offices and central 
units were appointed by the new Police Director. The department for the fight against serious 
criminal  offences  was  dismantled  and  all  its  officers  were  temporarily  suspended.  The 
equipment  of  this  department  was  transferred  to  the  Special  Police  Unit.  The  Head  of  the 
Special Police Unit was promoted to the post of Deputy Police Director in charge of the fight 
against  organised  crime,  replacing  the  arrested  former  Deputy  Director,  while  remaining 
Head  of  the  Special  Police  Unit.  He  was  also  appointed  as  main  contact  person  for  the 
cooperation  with  Europol.  Merit-based  appointments  and  procedural  safeguards  against 

54 

 
 
political influence need to be guiding principles in the reform of the police. 

The percentage of women in the police has increased from 9% to 13.8% in the last ten years, 
with  20  women  in  middle-  or  low-level  managerial  positions  (8.5%  of  all  managerial 
positions). There is no woman at senior management level.  

Implementation and enforcement capacity 

In  2022,  Montenegro’s  law  enforcement  agencies  had  key  successes  in  the  fight  against 
criminal networks and arrested 24 members of the so-called Balkan Cartel group, suspected 
of  drug  smuggling.  In  2022,  the  SPO  launched  17  new  investigations  into  organised  crime 
against  140  people  and  five  legal  entities  (2021:  13)  and  brought  indictments  in  13  cases 
against 103 people and six legal entities.  

The proactive approach of the SPO was reflected in an unprecedented number of high-profile 
cases,  suggesting  a  deep  infiltration  of  organised  crime  into  state  structures  and  law 
enforcement  agencies.  The  cases  currently  under  investigation  or  pending  before  the  courts 
involve,  among  other  people,  a  former  Special  Prosecutor,  the  former  President  of  the 
Commercial  Court,  the  former  President  of  the  Supreme  Court,  the  former  Director  and  a 
staff  member  of  the  National  Security  Agency,  the  former  Director  of  the  customs  and 
several  customs senior officials,  a former Acting Deputy  Police Director and several  police 
officers,  a  former  official  of  the  penitential  administration,  the  mayor  of  Budva,  a  former 
prosecutor  of  a  Basic  Court,  etc.  The  prosecution  of  the  former  President  of  the  Supreme 
Court  of  Montenegro,  of  her  son,  her  former  bodyguard  and  nine  other  people  led  to  an 
indictment  in  October  2022.  They  are  suspected  of  creating  a  criminal  organisation,  drug 
smuggling,  active  and  passive  corruption,  abuse  of  official  position,  illegal  possession  of 
weapons and concealment of evidence.  

In  November  2022,  an  indictment  was  brought  against  the  former  President  of  the 
Commercial  Court  of  Montenegro  and  12  other  defendants  (including  bankruptcy  trustees 
and four legal entities) on suspicion of creation of a criminal organisation and abuse of office. 
The case involving a former Special Prosecutor is related to his suspected links with one of 
the two main criminal groups of Montenegro and suspected protection of the interests of this 
group by deciding to close an investigation despite sufficient legal ground to continue it.  

In  March  2023,  the  police  of  Montenegro  was  targeted  by  a  series  of  arrests.  The  Special 
Police Unit brought charges against 18 people, including six police officers and one former 
National  Security  Agency  officer,  for  their  suspected  involvement  in  a  broad  trans-Atlantic 
cocaine smuggling network. A total of six suspects were arrested, while others are on the run 
or abroad. One week later, the Acting Deputy Police Director for the fight against organised 
crime was arrested on suspicion of involvement in the same case. A key protagonist in this 
case, a former police officer, is still at large.  

The  number  of  court  judgments  and  convictions  continued  to  rise  in  2022,  reflecting  the 
upward  trend  in  the  number  of  investigations  since  2020.  The  High  Court  in  Podgorica 
handled 79 cases of organised crime and high-level corruption, against 606 defendants (2021: 
73 and 492, respectively). A total of nine cases were partially resolved. Decisions against 20 
people  were  taken,  of  which  18  were  convictions  based  on  a  plea  bargain  and  two  were 
acquittals.  The  Special  Department  of  the  High  Court  of  Podgorica  in  charge  of  organised 
crime and high-level corruption currently has six judges. 

The  external  assessment  of  the  sentencing  policy  of  Montenegro  conducted  in  2021 
concluded  that  courts  tend  to  impose  sentences  in  the  bottom  third  or  lower  half  of  the 
sentencing  ranges.  This  conclusion  has  not  led  to  a  review  of  sentencing  policy.  Until 

55 

 
 
in  sentences,  fines  and  asset  confiscations 

October  2022,  plea  bargains  continued  to  be  widely  used  in  organised  and  serious  crime 
cases, to process cases more quickly by confirming the defendant’s guilt and ensuring some 
asset  confiscation,  resulting 
that  are 
disproportionally low compared with the gravity of the crime. A working group made up of 
prosecutors and judges from various jurisdictions was created to prepare guidelines to better 
regulate the use of plea bargain and set  common standards for prosecutors. The use of plea 
bargains was temporarily suspended in October 2022. The High Court’s organisational issues 
and  constraints  (including  the  insufficient  space  for  hearings)  were  not  addressed  and 
continued to lead to frequent adjournments and lengthy trials. Some cases have been pending 
before the Court since 2017.  

In 2022, Montenegro continued to be actively involved in international police cooperation. 
Montenegro  exchanged  a  total  of  4 225  communications  through  Europol’s  Secure 
Information Exchange Network Application (SIENA) (2021: 4 292) and 585 communications 
with  foreign  liaison  officers  (2021:  499).  A  total  of  14  fugitives  were  targeted  by  active 
search. The connection of Montenegrin law enforcement agencies – including the department 
in charge of the fight against organised crime  – to SIENA improved the proactivity and, to 
some  extent, 
investigations.  Montenegro  also  exchanged  36 991 
communications through Interpol in 2022 (2021: 59 162). 

the  efficiency  of 

Based  on  requests  from  Montenegro,  43  criminal  group  members  were  arrested  abroad, 
including the leader of a Montenegrin organised crime group. The number of organised crime 
group members arrested in Montenegro based on arrest warrants from foreign Interpol offices 
and fugitive searches rose to 71 (from 55 in 2021), including three people from the FBI most 
wanted  list,  and  the  leader  of  a  Turkish  organised  crime  group.  In  March  2023,  the  police 
arrested a South Korean national under an international arrest warrant for an illegal financial 
scheme involving USD 40 billion in cryptocurrencies. 

In 2022, Montenegro participated in 63 operational actions across 13 operational action plans 
(OAPs) of the European Multidisciplinary Platform against Criminal Threats (EMPACT) and 
was  the  co-leader  of  4  operational  activities,  such  as  the  operational  activities  on  high-risk 
criminal  networks  and  on  weapons  trafficking  prevention,  detection  and  counteraction.  In 
2023, Montenegro is participating in 54 operational actions across 14 OAPs, is the leader of 
one and the co-leader of two operational actions. An EMPACT working team was created in 
the police, headed by the national EMPACT coordinator. 

In  October  2022,  Montenegro  successfully  hosted  the  biggest-ever  EMPACT  Joint  Action 
Days  organised  in  a  non-EU  country,  under  the  coordination  of  Spain,  with  the  support  of 
Europol, Frontex, Eurojust, INTERPOL and many more. Montenegro provided material and 
human resources to support the operation.  

Cooperation  with  the  EU  Agency  for  Law  Enforcement  Training  (CEPOL)  is  based  on  the 
working  arrangement  signed  in  October  2021  which  replaced  the  previous  cooperation 
agreement.  Montenegro  continued  to  participate  in  the  Partnership  against  Crime  and 
Terrorism project in the Western Balkans led by CEPOL. . 

As  regards  the  cooperation  between  law  enforcement  agencies  at  national  level,  most 
institutions are connected at technical level through a common platform, except the cadastre 
and the penitentiary administration, which have not met the technical requirements yet. In the 
meantime, the SPO can access cadastral data by using a token. However, another challenge is 
the  incomplete  digitalisation  of  the  cadastre,  as  most  cadastral  data  exist  only  on  paper. 
Investigators,  Special  Prosecutors  and  officers  from  the  Asset  Recovery  Office  have  direct 
access to some but not all databases. Special Prosecutors still need to send prior requests to 

56 

 
 
some  institutions  to  obtain  data,  at  the  expense  of  the  efficiency  and  confidentiality  of  the 
investigation.  

In addition, the absence of a digital case management system shared between the police and 
prosecution  services  creates  long  delays  in  investigations.  Confidential  material  related  to 
ongoing  investigations  is  exchanged  between  investigators  and  prosecutors  via  drivers  on 
paper, USB keys or DVDs and goes through lengthy registration procedures.  

In 2022, the SPO initiated 10 financial investigations against 96 people (2021: 26 and 156, 
respectively),  all  of  them  launched  in  parallel  with  the  preliminary  criminal  investigation. 
Against the background of the increase in police staff, a specialised unit for the fight against 
corruption and economic crime and financial investigations was created in September 2022, 
to  initiate  more  financial  investigations  in  parallel  with  criminal  investigations  and  to 
improve their quality. Some 60 posts are allocated to this unit. The new rulebook introduced 
the possibility to recruit bank, accountancy and tax specialists without police background. As 
in  previous  years,  temporary  seizures  of  movable  and  immovable  assets  worth  tens  of 
millions of euro were conducted, based on notifications from the Financial Intelligence Unit 
or  other  sources.  Substantial  amounts  were  blocked  on  resident  and  non-resident  accounts. 
However,  there  was  only  one  final  court  decision  on  asset  confiscation  in  2022,  for  an 
amount of EUR 805.  

In  2022,  the  Asset  Recovery  Office  received  from  foreign  partners  44  requests  for 
identification  of  assets  acquired  in  Montenegro  with  the  proceeds  of  criminal  activity, 
involving  checks  on  330  people  and  16  legal  entities.  The  number  of  requests  from 
Montenegro  to  foreign  partners  through  the  Asset  Recovery  Office  surged  from  7  to  16 
compared  with  2021,  boosted  since  September  2022  by  the  work  of  the  newly  created 
economic  crime  unit.  These  requests  involved  checks  on  64  people  (members  of  organised 
crime groups) and 16 legal entities. However, the incomplete land cadastre limits the scope of 
financial investigations and asset confiscations. 

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,  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 2022, the initial track record of investigations into trafficking in human beings continued 
to  improve.  A  stronger  institutional  capacity  was  reflected  in  a  higher  number  of  cases 
detected.  A  total  of  13  new  investigations  were  launched,  while  the  four  investigations 
launched in 2021 were still ongoing. A total of five indictments were filed against 12 people. 
Between January and March 2023, 10 new investigations were launched. However, there was 
no single court decision in any of the 11 cases pending before the courts in 2022 and in the 
first trimester of 2023. No verdict related to trafficking in human beings has been issued by 
courts in the last two and the half years. 

The  multi-disciplinary  victim  identification  team,  which  is  in  charge  of  identification  of, 
referral of and initial assistance to victims, identified  16 victims, nine of which were minor 
girls  (victims  of  illicit  marriage,  i.e.  before  the  legal  age  of  18,  or  forced  beggary),  four  of 
which were women (victims of sexual exploitation or illicit marriage), and two were minor 
boys  (victims  of  illicit  marriage,  or  forced  beggary).  People  from  the  Roma  community,  in 
particular women and children, remained at high risk of trafficking in human beings. A police 
action to prevent  and combat forced beggary is  being implemented continuously. However, 

57 

 
 
no  case  of  large-scale  organised  trafficking  for  sexual  exploitation  has  been  unveiled  in 
recent years. 

The  labour  inspection  services  conducted  182  inspections  of  work  facilities,  in  cooperation 
with the police, focusing on foreign workers. A total of 516 cases of illegal employment of 
foreigners  were  detected,  but  no  cases  of  labour  exploitation.  The  capacity  of  labour 
inspectors and law enforcement agencies to detect, identify and investigate trafficking for the 
purpose of labour exploitation needs to be strengthened. 

State  institutions  closely  cooperate  with  and  provide  financial  support  to  civil  society 
organisations,  as  key  partners  for  victim  protection  and  awareness  raising.  In  2022, 
EUR 40 000 of state funds were allocated to five NGOs under a programme addressing the 
priorities of the national strategy for combating trafficking in human beings for 2019-2024. 
However, the shelter for victims of trafficking in human beings, financed by the state and run 
by an NGO, was closed in December 2022, after two minor victims hosted in the shelter filed 
a complaint with the local police about violence exerted against them by the manager of the 
shelter  (who  also  managed  the  NGO).  Montenegro  currently  has  no  shelter  for  victims  of 
trafficking in  human beings, and no specialised  shelter for children victims either. In 2023, 
the previous manager of the shelter received another grant from the Ministry of Interior, after 
having  funded  a  new  NGO.  Montenegro  needs  to  strengthen  control  over  the  allocation  of 
state  funds  in  this  area,  where  the  highest  professionalism  and  ethical  standards  should 
prevail. 

Overall,  Montenegro  needs  to  substantially  improve  the  criminal  justice  response  to 
trafficking  in  human  beings,  by  shortening  legal  proceedings  and  applying  deterrent 
sentences.  Montenegro  should  strengthen  its  capacity  to  detect  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.  The  support  and 
assistance  services  for  victims  of  trafficking  should  be  improved,  in  particular  for  victims 
belonging  to  vulnerable  communities.  A  shelter  for  victims  of  trafficking  in  human  beings 
should  be  opened  as  a  matter  of  priority.  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. The Law on compensation of damages for victims of violent crimes, adopted 
in 2015, should be applied. 

In  the  area  of  firearms,  246  criminal  offences  of  unlawful  possession  of  weapons  and 
explosive  substances  were  registered  in  2022.  A  total  of  729  weapons  were  seized  in  2022 
(2021:  556).  The  ‘Traffic’  application  connects  the  Firearms  Focal  Point  to  the  ballistic 
laboratory and to the police unit in charge of international cooperation. It enables the secured 
exchange of data on seized firearms at national and international levels. The number of users 
of the application was extended and police officers were trained to use the iARMS database. 
The Ministry of Interior also uses an information system for lost, stolen and wanted weapons. 
However,  Montenegro’s  data  collection  and  reporting  system  on  firearms  have  yet  to  be 
standardised.  A  group  of  experts  was  formed  to  prepare  the  accreditation  of  the  ballistic 
laboratory  under  the  relevant  ISO  standards.  Despite  the  existence  of  a  storage  facility  for 
small  arms,  light  weapons  and  ammunition  in  Rogame,  seized  weapons  are  stored  in  the 
building of the SPO until the end of the legal proceedings, in inappropriate storage and safety 
conditions.  Montenegro  needs  to  increase  efforts  on  awareness  raising,  outreach  and 
education on the dangers and risks related to the misuse, illicit possession, and trafficking of 
firearms.  Measures  aimed  at  reducing  illicit  firearms  through  legalisation,  voluntary 

58 

 
 
surrender,  de-activation  and  destruction  should  be  implemented,  in  line  with  the  EU  action 
plan on firearms trafficking. 

Montenegro substantially increased its capacity to address cybercrime. The number of posts 
in the specialised unit was increased from 5 to 18. This includes posts open to IT specialists 
without  police  background.  The  SPO  launched  11  preliminary  investigations  for  cyber-
related offences against 13 people. There was no final conviction in the area of cybercrime in 
2022. The capacity of all institutions in this area should be strengthened, including on the use 
of  electronic  evidence  in  court  handlings,  a  crucial  aspect  to  address  modern  forms  of 
communication 
in  organised  crime  groups.  Montenegro  should  ensure  effective, 
proportionate and dissuasive penalties, including  for legal  persons, in  line with  the relevant 
EU  acquis.  Cybercrime  offences  and  cyber  incidents  often  remain  unreported.  More 
awareness-raising  activities  about  risks  and  threats  should  be  conducted,  to  encourage  the 
public to report cybercrime offences. 

In  May  2022,  Montenegro  signed  the  Second  Additional  Protocol  to  the  Convention  on 
Cybercrime  on  Enhanced  Cooperation  and  Disclosure  of  Electronic  Evidence.  Montenegro 
remains  a  member  of  the  WePROTECT  Global  Alliance  against  child  sexual  exploitation 
and abuse. Draft amendments to the Criminal Code in relation to cybercrime were drafted. 
The  cybercrime  unit  acquired  a  specialised  software  system  to  track  online  child  sexual 
abuse. 

In  the  area  of  money  laundering,  the  institutional  capacity  and  the  initial  track  record 
continued to improve, but the number of cases remained limited.  The number of suspicious 
transaction reports received by the Financial Intelligence Unit rose to 328 (2021: 299). The 
Financial  Intelligence  Unit  issued  18  orders  to  suspend  a  transaction  to  commercial  banks. 
The  SPO  launched  Two  investigations  against  four  people,  bringing  the  total  number  of 
ongoing investigations into money laundering to six. In 2022, two indictments were brought 
against three people. No financial investigation was launched in relation to money laundering 
in  2022  and  in  the  first  quarter  of  2023.  The  High  Court  of  Podgorica  handled  nine  cases 
against 91 defendants in 2022, but despite an increased number of cases reaching the court, 
no final decision on money laundering was pronounced.  

The complex Atlas Bank case, involving 248 defendants in various criminal proceedings for 
the creation of a criminal organisation, money laundering and tax evasion since 2019, is still 
ongoing. An extradition request was made for one key defendant, who fled from Montenegro 
to  the  UK.  Out  of  the  eight  indictments  filed  by  the  SPO  in  this  case,  three  still  await 
confirmation.  No  court  hearing  has  started.  Since  January  2022,  the  Council  of  Europe 
Committee  of  Experts  on  the  Evaluation  of  Anti-Money  Laundering  Measures  and  the 
Financing  of  Terrorism  (MONEYVAL)  carries  out  the  fifth  round  of  evaluation  of 
Montenegro.  

In the area of tobacco smuggling, the ban on storage of tobacco products in the free zone of 
the port of Bar, imposed by the customs administration, entered into force in May 2022. It led 
to the seizure of an unprecedented number of cigarettes, which their owners had left on the 
spot. Other substantial seizures took place throughout the year. An estimated amount of 1 500 
tonnes  (or  13  cubic  metres)  of  cigarettes  is  stored  in  Bar  and  awaits  destruction.  Large 
quantities  of  cigarettes  had  disappeared  from  warehouses  before  the  entry  into  force  of  the 
ban.  A  total  of  seven  customs  officers  working  in  the  free  zone  were  suspended.  The 
transport  of  two  trucks  carrying  cigarettes  to  a  destruction  facility  in  Nikšić  in  September 
2022 ended with the disappearance of one of the two trucks, even though the transport was 
organised by the customs administration and escorted by the local police. The missing truck, 
with  a  cigarette  shipment  worth  EUR 10  million,  was  eventually  found  by  the  SPO  near 
59 

 
 
investigations 

Podgorica  and  more  arrests  of  customs  officials  took  place,  including  the  Director  of  the 
Revenues  and  Customs  Administration  in  December  2022.  In  2022,  the  SPO  launched  two 
new 
tobacco  smuggling  against  six  people.  Parallel  financial 
investigations  were  launched  in  both  cases.  The  police  also  worked  on  numerous  cases  of 
smaller  size  and  brought  35  charges  relating  to  tobacco  smuggling  to  Basic  Prosecutors’ 
offices. However, there was no final court decision on tobacco smuggling in 2022. 

into 

Montenegro  needs  to  make  stronger  efforts  to  address  the  illicit  trade  of  cigarettes.  This 
would  involve  strengthening  the  capacity  of  all  institutions  involved,  further  strengthening 
the work of the whole judicial chain, dismantling criminal networks, and improving the track 
record in final convictions and confiscations of the proceeds of crime. 

On witness protection, protection measures applied to six witness protection programmes, in 
cases under the jurisdiction of the SPO. Protection and support measures were implemented 
for 11 people on request of the International Criminal Court in The Hague. 

Cooperation in the field of drugs 

Institutional set-up and legal alignment 

Montenegro’s strategic and regulatory frameworks in this area are not fully aligned with the 
EU  acquis.  The  national  drug  information  system  does  not  fully  meet  EU  standards.  The 
capacity  of  the  Directorate  for  the  prevention  of  drug  abuse  in  the  Ministry  of  Health,  in 
which the National Drug Observatory is embedded, was strengthened by creating new posts 
and recruiting new staff members. In December 2022, Montenegro submitted to the European 
Monitoring Centre for Drugs and Drug Addiction a national drug situation overview and an 
information  map,  drafted  through  an  inclusive  process  involving  institutions  and  NGOs.  In 
April  2023,  thanks  to  the  improvement  of  the  cooperation  with  the  Centre,  activities 
involving  Montenegro  in  an  Instrument  for  Pre-accession  Assistance  project  could  be 
resumed, following a suspension of the cooperation in June 2022. The suspension was linked 
to the insufficient involvement of the National Drug Observatory in project-related activities 
at that time. 

Montenegro has had no drug strategy in place since the previous strategy came to an end in 
2020.  The  national  early  warning  system  is  still  not  ready  to  be  linked  to  the  EU  early 
warning system,  as  it has limited operational  capacity. The government  adopted  a rulebook 
on  the  method  of  destroying  drugs  and  keeping  records  of  seized  and  destroyed  drugs. 
Montenegro needs to adopt an overarching national drug strategy, to ensure the functioning 
of the national drug observatory and to improve the national early warning system in order to 
enable its connection with the EU early warning system. 

Implementation and enforcement capacity 

Montenegro continued to be a transit country for drugs, as a part of the Balkan route. A total 
of 2.3 tonnes of drugs were seized in 2022, in 1 395 seizures. They included marijuana (1.8 
tonnes),  heroin  (3 kg),  cocaine  (500 kg),  hashish,  synthetic  drugs  and  other  illicit 
pharmaceutical  products,  pieces  of  marijuana  stalks,  cannabis  oil  and  hallucinogenic 
mushrooms.  The  police  filed  six  criminal  charges  against  65  people  (of  which  37  were 
members of organised crime groups). 

In  2022,  the  SPO  conducted  eight  drug-related  criminal  investigations  in  cooperation  with 
international partners. The High State Prosecutor’s Office handled three drug-related criminal 
investigations at international and national levels. These investigations led to drug seizures in 
Montenegro, Serbia and  Albania. The police unit in  charge of drug-related offences  is  now 

60 

 
 
divided into two groups, one for the fight against drug smuggling associated with organised 
crime and one for the prevention of drug abuse. It has 25 staff members in total. 

The  insufficient  storage  capacity  for  seized  drugs  has  yet  to  be  addressed.  Montenegro  has 
yet to adopt amendments to the Criminal Procedure Code to make it possible to keep only a 
sample of drugs as evidence for court proceedings, and not the entire amount as it is the case 
now. Meanwhile, tonnes of seized drugs are stored in the country’s prosecution offices and 
courts, in inappropriate health and security conditions, awaiting trials.  Montenegro needs to 
amend  the  legal  framework  on  drug  storage  and  drug  sampling  as  a  matter  of  priority  and 
align  it  with  EU  health,  security  and  environmental  standards  in  the  storage,  transport  and 
destruction of drugs. 

Fight against terrorism 

Institutional set-up and legal alignment 

Montenegro’s legal framework is largely aligned with the EU acquis. 

In September 2022, the Parliament adopted the Law on the processing of data on passengers 
in  air  transport.  It  aims  to  prevent  and  detect  criminal  acts  of  terrorism  and  other  serious 
crimes.  A  police  unit  was  created  to  take  charge  of  processing  air  passengers’  data  and 
conducting  criminal  investigations  in  this  area.  Montenegro  has  yet  to  create  a  legal 
framework regulating online terrorist content. Preventive monitoring of risk groups is being 
carried out, based on risk assessment.  

Montenegro continued to implement  the measures  set  in  the EU-Montenegro  Implementing 
Arrangement of the Joint Action Plan on Counter-Terrorism for the Western Balkans, signed 
in November 2019, and submitted its fifth implementing report in February 2023. In January 
2023,  a  new  national  coordinator  for  combating  violent  extremism,  terrorism,  money 
laundering and terrorist financing was appointed. The previous national coordinator had been 
appointed  Director  of  the  Revenues  and  Customs  Administration  in  2022  and  was 
subsequently  arrested  as  part  of  an  investigation  into  tobacco  smuggling.  The  new  national 
coordinator has reactivated the National Operational Team to coordinate the implementation 
of the two strategies (on counterterrorism and prevention of violent extremism).  

Implementation and enforcement capacity 

The threats of terrorism and violent extremism remained relatively low. There are currently 
no  people  convicted  for  a  terrorism  offence  in  Montenegrin  prisons.  However,  a  cause  for 
concern  are  growing  polarisation  along  ethnical  lines,  online  and  offline  disinformation, 
ethno-nationalism  and  hate  speech,  exacerbated  by  Russia’s  war  of  aggression  against 
Ukraine.  

A  criminal  charge  was  filed  by  the  police  against  one  person  related  to  encouragement  of 
terrorism, after the suspect threatened on his blog to carry out a mass shooting in a school. 
Since 2020, one investigation against nine suspects  has been ongoing.  The retrial  of the 13 
defendants (including two Russian and eight Serbian citizens) found guilty of terrorism in the 
2016 coup attempt case, started in June 2023, after the first instance judgment was revoked 
by the Appeal Court in 2022 and the case was returned to the High Court.  

In  2022,  practical  implementation  of  the  strategy  on  preventing  and  countering  violent 
extremism  was  limited,  mostly  because  of  the  National  Operational  Team’s  inaction. 
Measures  to  strengthen  the  capacity  of  operators  for  the  prevention  of  extremism  at  local 
level had a limited impact and lacked local ownership. Their local risk assessment tool needs 
to be developed and implemented.  Montenegro continued its good cooperation with Europol 

61 

 
 
in this area. In 2022, the number of messages exchanged with foreign counterterrorism units 
through Europol’s SIENA communication link rose to 342 (from 203 in 2021). 

The  problem  of  foreign  terrorist  fighters  is  limited  in  Montenegro.  However,  14  foreign 
terrorist  fighters  are  reported  to  be  still  in  conflict  zones,  while  ten  had  returned  to 
Montenegro before 2016. No one is currently in detention.  

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  stakeholders, 
with  special  attention  to  hybrid  and  cyber  threats.  Comprehensive  programmes  for  risk 
assessment and disengagement,  rehabilitation and reintegration should be  further developed 
and implemented within the prison and probation services. Montenegro’s authorities need to 
improve  capacity  to  properly  address  the  terrorist  and  extremist  content  online,  increasing 
efforts  to  refer  terrorist  content  to  internet  companies  and  empowering  civil  society  to 
develop effective counter narratives. 

Judicial cooperation in civil and criminal matters 

Montenegro’s legal framework is largely aligned with the EU acquis. Montenegro initiated 
legal steps to accede to the 2019 Hague Convention on the Recognition and Enforcement of 
Foreign Judgments in Civil and Commercial Matters, and to the 2000 Hague Convention on 
the  International  Protection  of  Adults.  Montenegro  has  yet  to  become  a  party  to  the  2007 
Hague Protocol on the Law applicable to Maintenance Obligations.  

In 2022, 958 cases of mutual legal assistance in criminal matters were processed (2021: 843) 
and 594 cases in civil matters (2021: 701). The main partners remained the Western Balkan 
countries and the EU Member States.   

A  cooperation  agreement  with  Eurojust  has  been  in  place  since  2016,  with  a  liaison 
prosecutor  on  duty  since  December  2017.  There  was  a  surge  in  Montenegro’s  cooperation 
with Eurojust in 2022. In 2022, 55 cases of judicial cooperation were opened with the support 
of  Eurojust  (2021:  17),  including  42  cases  initiated  by  Montenegro.  This  reflects  an 
increasing  awareness  among  Montenegrin  prosecutors  of  the  benefits  of  using  Eurojust 
cooperation  channels.  However,  to  date  Montenegro  has  not  engaged  in  any  joint 
investigation  team  with  an  EU  Member  State.  A  working  arrangement  with  the  European 
Public Prosecutor’s Office was signed in September 2022. 

Montenegro  should  further  increase  the  speed  and  efficiency  of  international  judicial 
cooperation,  by  increasing  its  use  of  judicial  cooperation  instruments,  such  as  joint 
investigations teams, and a more frequent use of direct court-to-court cooperation. 

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. Montenegro joined the European Migration Network as an observer in September 
2022, and appointed a national coordinator in October 2022.  

Montenegro  has  12  readmission  agreements  with  non-EU  countries.  However,  it  has  no 
readmission  agreement  with  any  of  the  main  country  of  origin  of  migrants,  coming  to 
Montenegro,  which  would  be  needed  to  process  non-voluntary  returns.  In  November  and 
December 2022, meetings with representatives of Pakistan, Algeria and Morocco took place 
to  discuss  the  readmission  by  Montenegro  of  irregular  migrants  to  these  countries. 
Cooperation  methods  still  need  to  be  developed  to  facilitate  the  official  identification  of 
migrants  by their embassies (located  in  Sofia and Belgrade, respectively).  Montenegro also 

62 

 
 
initiated  diplomatic  steps  for  negotiating  a  readmission  agreement  with  the  United  Arab 
Emirates.  

Implementation and enforcement capacity 

Legal  labour  migration  to  Montenegro  continued  to  increase.  Seasonal  labour  migrants, 
mainly from neighbouring Western Balkan partners, are working primarily in the tourism and 
construction  sectors.  In  2022,  29 319  temporary  residence  and  work  permits  were  issued,  a 
40%  surge  compared  with  2021.  The  grey  economy,  however,  provided  room  for  irregular 
labour migration and risks of exploitation. 

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 master plan laying down the technical requirements for 
setting  up  a  modern  system  to  register  migrants  was  prepared  in  close  cooperation  with 
Frontex. The purchase of equipment and actual set-up of the system will be supported by a 
EUR 15 million project funded by the Instrument for Pre-accession Assistance. 

According to the Ministry of Interior, 8 519 migrants were registered after illegally crossing 
the  border  in  2022,  a  twofold  increase  compared  with  2021,  reflecting  regional  trends. 
Afghan nationals made up 60% of the total, followed by Iranian and Bangladeshi nationals. 
During the summer 2022, the army was once again called upon to support the border police at 
the  border  with  Albania.  In  2022,  4 920  attempts  of  illegal  entry  were  prevented  (2021: 
4 018). This concerns situations in which irregular migrants turned back when seeing border 
patrols  or  border  equipment.  The  border  police  detained  511  people  (2021:  239)  for  illegal 
entry, and prosecuted 202 of them (2021: 146).  

The  border  police  detected  eight  cases  of  migrant  smuggling,  leading  to  the  arrest  of  nine 
people.  In  2022,  five  indictments  were  brought  in  relation  to  migrant  smuggling  combined 
with  organised  crime,  but  no  conviction  was  pronounced.  A  new  unit  for  the  fight  against 
human smuggling and cross-border crime was created in the border police. Some 78 migrants 
were detained in the detention centre for foreigners in Spuž (2021: 83), including 19 migrants 
from  Serbia  and  12  from  Kosovo.This  centre  currently  does  not  provide  access  to  health 
services on the spot; detainees are taken to a medical centre in case of need. 

The  EU-Montenegro  readmission  agreement  and  its  15  implementing  protocols  with  EU 
Member States continued to be implemented satisfactorily.  

Reintegration  plans  for  Montenegrin  returnees  were  drawn  up  upon  their  return  to 
Montenegro.  An  inter-ministerial  team  was  created  to  support  reintegration.  This  team  is 
made  up  of  representatives  of  the  Ministries  of  Interior  Affairs,  Finance,  Social  Welfare, 
Education,  Health,  Employment  and  Labour,  and  of  the  International  Organization  for 
Migration  and  the  Red  Cross.  The  capacity  of  local  teams  to  ensure  readmission  and 
reintegration was strengthened. A new reception space for Montenegrin returnees under the 
readmission  procedure  was  created  at  the  Podgorica  airport,  to  conduct  interviews  with 
returnees upon their arrival.  

Readmission from Montenegro to neighbouring countries fell to 33 people in 2022 (from 60 
in  2021);  readmissions  from  Western  Balkan  partners  to  Montenegro  also  dropped  to  71 
(from 104 in 2021), reflecting a higher mobility on the migratory road. In 2022, 37 voluntary 
returns  were  processed  (2021:  36).  The  border  police  processed  25  returns  to  neighbouring 

 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. 

63 

 
 
 
countries and the International Organization for Migration processed 12 returns to countries 
of origin.  

Montenegro  must  continue  its  efforts  to  cope  with  migratory  pressure,  by  developing  its 
international  cooperation  on  readmission,  increasing  its  capacity  to  prosecute  migrant 
smuggling  networks,  and  setting  up  a  modern  migrant  data  collection  system  including 
biometric data. 

Asylum 

Institutional set-up and legal alignment 

Montenegro’s legal framework on asylum is largely aligned with the EU acquis. During the 
reporting period, the capacity of the asylum system was strengthened and a substantial State 
budget allocation was earmarked to expand reception capacity. The fruitful cooperation with 
the  EU  Agency  for  Asylum,  within  the  cooperation  roadmap,  continued  to  strengthen  the 
institutional  capacity  of  the  Directorate  for  Asylum  and  the  overall  asylum  system  of 
Montenegro in line with the Common European Asylum System. With the support of the EU 
Agency  for  Asylum,  a  new  unit  dealing  with  country-of-origin  information  was  created, 
training  modules  were  developed,  and  standard  operating  procedures  were  drafted  to 
harmonise and systematise the procedures.  A contingency plan, elaborated with the support 
of  the  EUAA  is  yet  to  be  adopted,  to  ensure  better  preparedness  for  sudden  influx  and 
emergency situations. 

Implementation and enforcement capacity 

The asylum application in Montenegro is a two-step procedure, under which applicants first 
register an intention to request asylum with the border police and then have 15 days to lodge 
an asylum request with the Directorate for Asylum. 

In 2022, the number of people registering an intention to request asylum increased by 150% 
compared  with  2021  and  reached  8 320  people,  reflecting  the  upward  trend  in  irregular 
entries. Afghan nationals represented 62% of them. Registration of intention to seek asylum 
is now possible in several municipalities, and not only in the Božaj migrant centre, close to 
the  Albanian  border.  However,  it  is  still  not  possible  in  all  municipalities,  border  crossing 
points  and  airports.  Migrants  arriving  to  locations  where  it  is  not  possible  to  register  an 
intention  to  request  asylum  need  to  travel  to  Božaj  to  register  their  intention.  The  opening 
hours of the border police in Božaj were extended, to enable registration of intention to seek 
asylum throughout the day.  

However, only 175 people, or 2.1% of those who registered an intention to request asylum, 
eventually  lodged  an  asylum  application,  while  the  others  absconded  and  continued  their 
migratory  movements.  In  2022,  for  the  first  time  ever,  Russian  nationals  represented  the 
largest  group  of  asylum  seekers  in  Montenegro,  with  72  applicants.  The  profile  of  asylum 
seekers also changed compared with 2021: 18% of them were accompanied children and 29% 
were  women.  Legal  counselling  provided  by  NGOs  is  available  to  asylum  seekers.  The 
Directorate for Asylum processed 80 asylum requests in 2022. In 2022, nine asylum seekers 
received an international protection status (2021: 14). The main countries of origin were the 
Russian Federation, Cuba, China, Ukraine and Afghanistan.  

Montenegro’s  Directorate  for  Asylum  made  efforts  to  reduce  the  backlog  of  asylum 
applications. While most applications were processed at the first instance level within the 6-
month regular deadline, nine cases were processed within the 21-month exceptional deadline. 
Fewer  decisions  were  overturned  at  second  instance,  reflecting  a  better  quality  of  the 
determination  process.  The  Directorate  for  Asylum  has  only  two  case  officers  and  two 

64 

 
 
country-of-origin  information  officers.  Yet  it  handles  asylum  applications  coming  from  24 
different  countries  and  five  continents,  including  an  increasing  number  of  complex  cases, 
where the applicant is the subject of an extradition request from their country.  

The  assistance  package  for  people  under  international  protection  includes  financial 
assistance, access to healthcare, education, employment, free legal aid, language courses and 
psychosocial assistance.  Accommodation is  provided for two years (with the support of the 
UN  Refugee  Agency).  Asylum  seekers  and  people  under  international  and  temporary 
protection have the right to open a bank account. However, most Montenegrin banks refuse 
this,  which  creates  serious  difficulties  in  accessing  employment  and  even  in  receiving 
financial assistance from the state.  

The number of migrants accommodated in the country’s reception centres surged to 6 022 in 
2022  (from  2 688  in  2021),  mainly  for  short  stays  of  one  week.  Some  7%  of  the  migrants 
accommodated were women and  6% were children. Montenegro has two reception centres, 
with a total capacity of 164 beds, of which 60 beds are in a temporary container settlement in 
Božaj.  Their  average  occupancy  rate  throughout  the  year  is  30%,  but  it  reaches  peaks  in 
spring and summer. A centre for unaccompanied children has 25 additional beds, but it is not 
devoted  exclusively  to  migrant  children.  Montenegro  is  the  only  country  in  the  Western 
Balkans that pays the running costs of the reception centres out of its state budget. Provision 
of health services and psychological assistance in the centres is ensured, but partly provided 
by  NGOs  and  financed  by  international  donors.  New  posts  of  managers  of  migrant  centres 
were created and filled during the reporting period. 

The EU allocated EUR 400 000 of financial assistance to Montenegro to build a fully-fledged 
migrant  centre  in  Božaj,  but  Montenegro  failed  to  prepare  the  tendering  documentation  on 
time, before the deadline for contracting in 2022, and the construction did not take place. In 
the  meantime,  EUR 645 000  was  allocated  from  Montenegro’s  state  budget  to  increase  and 
refurbish the existing reception centres. 

Montenegro is the Western Balkan partner hosting the highest number of Ukrainian nationals 
having  fled  Russia’s  war  of  aggression,  both  in  absolute  figures  and  proportionally  to  its 
population  (1%).  By  the  end  of  March  2023,  7 857  Ukrainian  nationals  had  been  granted 
temporary  protection  (70%  of  whom  were  women).  On  15 February 2023,  the  Decision  on 
granting  temporary  protection  to  people  fleeing  Ukraine  of  March  2022  was  amended  to 
prolong  the  temporary  protection  for  people  having  fled  the  war  until  March  2024,  in 
compliance  with  the Council  Implementing  Decision.  The categories eligible for temporary 
protection in Montenegro include citizens of Ukraine, stateless persons with last residence in 
Ukraine,  and  people  granted  international  protection  in  Ukraine.  The  amendments  also 
simplified the application procedure. However, the temporary protection was not  prolonged 
automatically  and  a  request  for  prolongation  had  to  be  submitted  before  the  expiry  date.  A 
total of 4 264 people prolonged their status, and 1 052 new applications were submitted after 
the deadline, bringing the number of people benefiting from temporary protection to 5 316 in 
June  2023  (including  3 226  women).  In  addition,  2 350  Ukrainians  stay  legally  in 
Montenegro under the Law on foreigners.  

An inter-ministerial coordinating body was set up between the Ministries of Interior, Labour, 
Health, Education, Finance and Foreign Affairs, the Consulate of Ukraine, the International 
Organization for Migration, the UN Refugee Agency and the Red Cross to coordinate support 
and integration measures for Ukrainian displaced persons.  

Montenegro  granted  displaced  persons  fleeing  Russia’s  war  of  aggression  against  Ukraine 
access to health services and accommodation to an extent that went beyond the minimum EU 

65 

 
 
standards. Some 104 Ukrainian displaced persons received free-of-charge accommodation in 
hotels, including meals and other services; 27 were hosted in a migrant centre. Around 2 500 
medical services were delivered. However, in doing so, Montenegro relied largely on ad hoc 
and emergency solutions,  which were not  embedded in  the state social system  and at  times 
faced practical implementation problems. Several sectoral laws still need to be aligned with 
the  Asylum  Law  to  ensure  that  people  under  temporary  and  international  protection  can 
exercise  their  social  rights.  Access  to  education  is  granted  by  law,  but  the  number  of 
Ukrainian children enrolled in Montenegrin schools remains low (151 children out of 1 114 
children of school age). Administrative barriers hinder access to health and employment due 
to  the  absence  of  a  personal  identification  number  compatible  with  the  social,  health 
insurance and employment IT systems of the state. 

Visa policy 

In  order  to  align  national  legislation  with  the  EU  acquis,  Montenegro  introduced  visa 
requirements for residents of the United Arab Emirates as well as for Cuban and Ecuadorian 
nationals (in January, April and May 2023, respectively) who previously benefited from visa-
free  entry  to  Montenegro.  However,  there  are  12  countries  which  are  visa  free  for 
Montenegro,  but  not  for  the  EU,  of  which  seven  enjoy  permanent  visa  exemption 
(Azerbaijan,  Belarus,  China,  Kuwait,  Qatar,  Russia,  Türkiye)  and  five  have  a  seasonal  visa 
waiver  to  enter  Montenegro  for  touristic  reasons  between  April  and  October  (Armenia, 
Egypt,  Kazakhstan,  Saudi  Arabia,  Uzbekistan).  The  decision  on  seasonal  visa  waivers, 
adopted  by  the  government  in  April  2023,  includes  preventive  measures  against  the  risk  of 
abuse of the visa-free regime, such as the need to be part of an organised tourist group, to fly 
in  and  out  the  territory  of  Montenegro  by  direct  charter  flights,  and  to  have  a  paid  tourist 
arrangement  or  an  invitation  letter  from  a  Montenegrin  tourist  agency.  Belarusian  and 
Russian nationals are visa-exempted up to 30 days on a permanent basis, as well as Chinese 
nationals if they are in organised tourist groups. 

The investor  citizenship  scheme was terminated  at  the end of 2022.  Between January 2019 
and  December  2022,  556  applications  were  lodged  (556  applicants  and  1 281  family 
members).  By  15  June  2023,  the  government  had  issued  954  positive  decisions  (293 
applicants and 661 family members). On 15 June 2023, 398 applications were still pending. 
The  remaining  pending  applications  need  to  be  checked  properly  to  ensure  that  they  fully 
comply  with  all  EU  restrictive  measures.  The  screening  of  the  source  of  related  funds  was 
carried out by external service providers. 
The  Sixth  report  under  the  Visa  Suspension  Mechanism4,  adopted  in  October  2023, 
concluded that Montenegro continued to take action to address the recommendations from the 
previous  year’s  report.  However,  further  progress  is  needed  on  the  alignment  of 
Montenegro’s  visa  policy  with  the  EU’s  list  of  visa-required  countries,  in  particular  as 
regards countries presenting irregular migration or security risks to the EU. The report also 
recommends  Montenegro  to  ensure  that  pending  applications  under  the  recently  terminated 
investor  citizenship  scheme  are  screened  and  processed  in  accordance  with  the  highest 
possible security standards. In this regard, in May 2023 the government adopted a decision on 
forming a Coordinating Body to monitor and implement the pending applications within this 
scheme. 

4 COM(2023) 730 

66 

 
 
 
Schengen and external borders 

Institutional set-up and legal alignment 

Montenegro’s legal framework is largely aligned with the EU acquis in this area. Montenegro 
and  the  EU  signed  a  new  status  agreement  on  16 May 2023.  The  new  agreement  enables 
European Border and Coast Guard Agency (Frontex) deployments anywhere on the territory 
of  Montenegro,  at  the  request  of  Montenegro’s  authorities.  The  two  joint  operations  being 
conducted  on  the  basis  of  the  current  status  agreement  continue  to  be  implemented:  the 
deployment  of  Standing  Corps  officers  with  executive  powers  at  Debeli  Brijeg,  a  border 
crossing  point  with  Croatia;  and  a  joint  maritime  operation  to  strengthen  blue  borders’ 
surveillance in the Adriatic. In addition, on the basis of a working arrangement between the 
Montenegrin  border  police  and  Frontex,  Standing  Corps  officers  are  deployed  with  an 
advisory  role  (without  executive  powers)  under  Joint  Operation  Coordination  Points. 
Montenegro  also  regularly  participates  in  EMPACT  operational  activities,  including  Joint 
Action Days.  

The  good  cooperation  with  Frontex  further  strengthened  the  capacity  of  Montenegro’s 
Coordination Centre. Electronic sea surveillance enables real-time online image transmission 
to  Montenegro’s  Coordinating  Centre  and  Frontex  Coordinating  Centre  in  Warsaw,  a  key 
mechanism  for  border  control  in  the  Adriatic  Sea  and  quick  interception  of  suspicious 
vessels.  The  internal  organisation  of  Montenegro’s  Coordination  Centre  was  further 
developed and a number of vehicles and patrol boats were acquired, increasing the Centre’s 
operational capacity. However, full coverage of critical areas is not ensured yet. A total of 11 
border crossing points are now connected to this Centre, while two have yet to be connected. 

A total of 168 new posts were created in the border police, bringing the total number of posts 
to  1 540  (a  14%  rise)  in  order  to  start  addressing  the  requirements  of  the  Schengen  action 
plan.  However,  450  more  posts  need  to  be  created.  The  new  posts  strengthen  in  particular 
local  border police stations. Further to  the  adoption, in  September 2022,  of the Law on the 
processing of data on passengers in air transport, a new unit was created in the police to deal 
with  passenger  information  issues.  An  operational  advanced  passenger  information  system 
has yet to be set up.  

Implementation and enforcement capacity 

In 2022, Montenegro conducted 500 joint border patrols with neighbouring countries (2021: 
437;  2020:  723),  including  218  joint  patrols  on  the  border  with  Albania  (2021:  341).  The 
activity of the joint police cooperation centres increased, with a higher volume of information 
exchanged. A total of 87 forged documents were seized. 

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. The border police still lacks a proper IT tool to monitor the purchase 
of equipment, to set priorities and draw up a purchase plan, linked with the Schengen action 
plan.  Its  insufficient  autonomy  in  criminal  investigations  continues  to  hamper  the 
development  of  its  analytical  capacity  and  intelligence  on  smuggling  networks.  A  new 
EUR 15 million sector budget support programme on integrated border management funded 
by the Instrument for Pre-accession Assistance is expected to start in 2023. 

Montenegro continued to cooperate actively with Interpol, Europol and EU Member States, 
notably: (i) under the regional Anti-Smuggling Operational Partnership between the EU and 
the  Western  Balkans  launched  in  November  2022;  (ii)  with  Europol’s  European  Migrant 

67 

 
 
Smuggling Centre; (iii) on EMPACT and its operational action plan on migrant smuggling; 
and  (iv)  in  the  Frontex  Western  Balkans  Risk  Analysis  Network.  In  2023,  Montenegro 
expressed its willingness to participate in 18 (out of a total of 28) operational actions of the 
2023 EMPACT operational action plan on migrant smuggling.  

Montenegro continued to develop its cooperation with neighbouring Western Balkan partners 
under  bilateral  border  traffic  agreements.  In  October  2022,  the  Parliament  adopted 
amendments  to  the  bilateral  agreement  with  Bosnia  and  Herzegovina  on  border  crossing 
points for border traffic,  to  simplify cross-border procedures for inhabitants of cross-border 
areas.  Montenegro  still  needs  to  demolish  15  alternative  roads  to  Serbia  and  13  roads  to 
Bosnia and Herzegovina.  

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. 

2.3.1. The existence of a functioning market economy 

Montenegro  has  made  limited  progress  and  is  moderately  prepared  in  developing  a 
functioning  market  economy.  Economic  expansion  continued  at  a  strong  pace  in  2022, 
supported  by  private  consumption  and  strong  growth  in  tourism,  partially  due  to  a  large 
influx  of  Russian  and  Ukrainian  nationals  following  Russia’s  war  of  aggression  against 
Ukraine. The main headwind came from inflationary pressures on the back of higher global 
commodity  prices.  The  current  account  deficit  increased  as  both  exports  and  imports 
expanded rapidly. An expansionary fiscal policy fueled domestic demand and contributed to 
very high net wage growth. The budget deficit increased significantly and a comprehensive 
medium-term  consolidation  plan  to  address  mounting  fiscal  challenges  has  not  been 

68 

Table 2.1:202020212022Montenegro - Key economic figuresGDP per capita (% of EU-27 in PPS)1)46454850Real GDP growth 3.7-15.313.06.1Economic activity rate of the population aged 15-64 (%), total63.761.559.267.7      female57.054.752.961.4      male70.468.365.573.9Unemployment rate of the population aged 15-64 (%), total16.918.316.815.0      female17.018.816.113.1      male16.817.817.316.6Employment of the population aged 15-64 (annual growth %)2.9-10.1-2.417.2Nominal wages (annual growth %)1.11.31.411.2Consumer price index (annual growth %)1.2-0.82.511.9Exchange rate against EUR1.01.01.01.0Current account balance (% of GDP)-14.5-26.1-9.2-13.2Net foreign direct investment, FDI (% of GDP)10.211.211.713.5General government balance (% of GDP)-4.3-11.1-1.9-5.2General government debt (% of GDP)66.2105.382.569.5Notes: 1) EurostatSource: national sources2014-19 average 
 
 
 
developed. The labour market situation improved, but structural problems persist, including 
large regional disparities and gender gaps, and high youth and long-term unemployment. The 
banking  sector  remained  well  capitalised  and  liquid.  Efforts  to  improve  the  business 
environment  and  the  governance  of  state-owned  enterprises  (SOEs)  slowed  down  due  to 
political uncertainty, even though the number of new businesses increased. 

Last year’s recommendations were addressed to a limited extent and remain mostly valid. In 
the  coming  year,  in  order  to  improve  the  functioning  of  the  market  economy,  Montenegro 
should in particular: 

→  design and implement a medium-term fiscal consolidation plan targeting the achievement 
of a non-negative primary balance from 2025, and a reduction of the public debt ratio in 
the medium term; 

→  implement  the  Law  on  budget  and  fiscal  responsibility  to  set  up  a  fiscal  council,  while 

ensuring full transparency in selecting the council members; 

→  prepare  an  analysis  of  the  economic  and  fiscal  impact  of  current  tax  exemptions  and 
provide  specific  budgetary  recommendations  to  reduce  tax  expenditure  such  as 
exemptions, deductions, credits and deferrals; 

→  prepare  a  roadmap  for  reforming  SOEs,  prepare  a  framework  for  the  monitoring  and 
management  of  SOEs,  and  develop  objective  criteria  for  the  selection  of  management 
bodies of SOEs; 

→  develop and implement specific measures to reduce the informal economy. 

Economic governance 

An  unstable  political  situation  led  to  lax  fiscal  policy  and  a  slowdown  in  structural 
reforms.  In  August  2022,  the  incumbent  government  lost  a  vote  of  no  confidence.  The 
ensuing  caretaker  government  was  not  in  a  position  to  advance  priority  reforms  to  address 
economic challenges. The reforms of SOEs were downscaled. The caretaker government did 
not adopt a medium-term fiscal consolidation strategy to address vulnerabilities in the light of 
forthcoming large debt repayments. By reducing taxes on basic consumption goods and fuels, 
the government  tried to  contain inflationary pressures and protect  the most  vulnerable.  The 
caretaker  government  adopted  several  revenue  strengthening  measures  in  early  2023  and 
revised the 2023 budget in May. The controversial economic citizenship programme, which 
supported public revenue but clashed with the country’s EU commitments, expired at the end 
of 2022. However, numerous pending applications were still processed well into 2023.  

The policy guidance set out in the conclusions of the Economic and Financial Dialogue 
of  May  2022  was  implemented  to  a  limited  extent.  Progress  was  made  in  setting  up  an 
independent  body  for  fiscal  oversight  and  strengthening  financial  stability,  but  only  limited 
improvement was achieved on structural reforms aiming to address informality and improve 
the business environment and the labour market situation. 

Macroeconomic stability 

Economic  expansion  continued  at  a  strong  pace  in  2022  despite  slowing  investment. 
Overall, real GDP grew by an estimated 6.1% in 2022 and the first quarter of 2023, following 
a  13%  rebound  in  2021  from  the  deep  COVID-19-induced  recession.  The  strong  economic 
growth  in  2022  was  mainly  driven  by  a  surge  in  private  consumption,  on  the  back  of 
increases  in  disposable  income,  employment,  household  lending,  and  remittances.  Private 
consumption  was  also  supported  by  Ukrainian  and  Russian  nationals  taking  up  temporary 

69 

 
 
residence. While export growth benefited from ongoing recovery in tourism as well as good 
performance of merchandise exports, a 
strong  surge  in  imports  led  to  a 
negative contribution of net exports to 
growth.  Capital  investment  remained 
to  a 
weak  and  contracted  due 
slowdown 
investment. 
in  private 
Overall,  the  rebound  of  the  economy 
brought  Montenegro’s 
per-capita 
income in purchasing power standards 
to  50%  of  the  EU-27  average  in  2022 
(the  highest  in  the  Western  Balkans), 

up from 45% in 2020, bringing it back to the level registered in 2019. 

Despite  the  strong  export  performance,  the  current  account  deficit  widened  in  2022. 
Following a record low in 2021, the current account deficit widened again to 13.3% of GDP 
in 2022, as high growth of exports of goods and services was outweighed by rapidly rising 
imports  due  to  price  effects.  Supported  by  good  performance  of  aluminium  and  electricity, 
merchandise  exports  increased  by  60%  compared  with  2021,  while  a  successful  tourism 
season led to a strong increase in exports of services (43%). However, goods imports, which 
are  much  larger  than  exports,  also  surged  (by  41.3%),  and  the  overall  trade  deficit  rose  to 
23.4% of GDP, compared with 19.4% in 2021. This was partially offset by surpluses in the 
primary  and  secondary  income  accounts,  which  increased  due  to  higher  compensations  of 
employees  working  abroad  and  higher  remittances.  The  current  account  deficit  was  fully 
financed by net foreign direct investment 
(FDI) inflows, which increased by 34.6% 
year  on  year  and  amounted  to  13.5%  of 
GDP,  with  a  large  share  going  into  real 
estate. 
international 
reserves  stood  at  EUR  1.9  billion, 
covering  4  months  of  imports  of  goods 
and services. The current account deficit 
deepened  in  the  first  quarter  of  2023  to 
terms, 
14%  of  GDP 
compared to 9.3% of GDP gap registered 
a  year  before.  Net  FDI  declined  slightly 

In  early  2023, 

in  annualised 

to 12.2% of GDP compared to 12.9% over the same period. 

Impacted by price rises following Russia’s war of aggression against Ukraine, inflation 
peaked at a record high level in 2022. Driven by global inflationary pressures, especially on 
food  and  fuel,  as  well  as  large  domestic  policy-induced  wage  increases,  average  inflation 
jumped to 13% in 2022. Annual inflation peaked at 17.5% in November 2022 and eased to 
6.9% in July 2023. The government adopted numerous and not always well-targeted support 
measures for households and firms to counterbalance the impact of higher inflation, including 
reduced  value  added  tax  rates  for  basic  foodstuffs  and  a  lower  excise  duty  on  sales  of 
unleaded  gasoline  and  gas  oils.  Based  on  regular  and  extraordinary  adjustment  to  inflation, 
the government decided to raise pensions by 8.5% from June onwards. 

The  budget  deficit  increased  substantially  in  2022.  The  general  government  deficit 
increased  significantly,  to  5.2%  of  GDP,  from  1.9%  in  2021.  Total  revenues  dropped 
markedly,  by  4.5%  of  GDP,  mainly  due  to  the  government’s  tax  reform,  which  abolished 

70 

-40-30-20-100102020182019202020212022Graph 2.2: Montenegro -Current account selected components and FDI Workers' remittances balanceGoods and services trade balanceCurrent account balanceNet FDI% of GDPSource: IMFand Central Bank of Montenegro -18-15-12-9-6-30369121518201720182019202020212022Graph 2.1: Montenegro -Real GDP growthand contributionsPriv. cons.Gov. cons.GFCFStocksNet exportsReal GDP growthSource: WiiW% y-o-y 
 
mandatory health contributions and introduced a non-taxable part of wage income. Revenues 
were also weakened by the temporary reduction of excise taxes on fuel and the reduction of 
VAT  rates  on  basic  foodstuffs  and  pellets.  Public  expenditure  increased  due  to  ad  hoc 
spending  decisions,  such  as  the  granting  of  additional  allowances  for  all  children  and  for 
mothers of three and more children; large increases in minimum pensions; wage increases in 
the  public  sector;  and  additional  financing  for  the  health  insurance  fund.  Nevertheless,  the 
2022  budget  outcome  was  better  than  envisaged  in  the  October  amendment  to  the  Budget 
Law, which targeted a deficit of 8.3% of GDP. This was due to a combination of higher-than-
projected  revenue,  mainly  from  VAT;  and  lower-than-expected  spending,  mainly  on 
investment  and  on  wages  as  there  were  delays  in  planned  employment.  Nominal  GDP  was 
also  higher  than  previously  projected.  At  the  end  of  December  2022,  the  Parliament  of 
Montenegro adopted the 2023 Budget Law with a projected deficit of 5.9% of GDP. In May 
2023, however,  the 2023 deficit target  was  revised to  3% (which would be in  line with  the 
rule  on  fiscal  responsibility)  as  a  result  of  higher  assumed  revenues  (due  to  the  EU  energy 
support  package,  higher-than-expected  inflation,  and  improved  tax  discipline)  and  some 
additional spending items related to early parliamentary elections and employment subsidies 
for people with a disability.  

The debt ratio recorded a substantial decline, but vulnerabilities remain high in view of 
large upcoming repayment needs amid tightening financing conditions. The public debt 
stock declined substantially, to 69.5% of GDP at  the end of 2022 after peaking at 105% of 
GDP at the end of 2020. This large fall 
was  driven  by  strong  GDP  growth  in 
2021-2022  and  the  use of  government 
deposits  to  repay  maturing  debt.  As  a 
result, 
stock  of  government 
deposits  declined  to  1.9%  of  GDP  at 
the  end  of  2022,  down  from  9.4%  in 
2021.  Large  repayments  of  public 
debt,  amounting  to  11%  of  GDP,  are 
due 
require 
substantial  new  borrowing.  With 
global financing conditions worsening, 

in  2025  and  will 

the 

debt-related vulnerabilities remain high. 

While  Montenegro’s  macroeconomic  policy  mix  is  constrained  by  the  lack  of  an 
autonomous  monetary  policy,  an  expansionary  fiscal  policy  contributed  to  widening 
budget  and  current  account  deficits  and  surging  inflation.  As  the  unilateral  use  of  the 
euro means that the Central Bank of Montenegro cannot influence interest rates and money 
supply, prudent fiscal policy remains a key tool to manage the economic cycle. While global 
commodity prices had a substantial impact, higher wages and pensions added to rapidly rising 
inflation.  Even  though  inflation  is  gradually  abating,  debt-related  vulnerabilities,  including 
large debt repayments in 2024-2027, require careful fiscal management in the years to come. 
Vulnerabilities in the health sector require a close monitoring. 

Functioning of product markets 

Business environment 

A growing number of registered businesses was supported by  the improving economic 
outlook  and  the  influx  of  foreign  citizens.  Although  electronic  registration  is  still  only 
available for single-member limited liability companies, but not for larger firms, the number 
of businesses  had increased by 11.8% to  73 358 by  the end of 2022. The number of newly 
71 

020406080100120-12-8-404201720182019202020212022Graph 2.3: Montenegro -Fiscal developmentsPrimary balance (lhs)Interest (lhs)GG balance (lhs)Public debt (rhs)Source: Nationalsources% ofGDP 
 
registered businesses reached 10 096 in 2022, compared with 5 559 in 2021. Around 80% of 
new companies were set up by foreign citizens. Following the adoption of a scheme to attract 
digital nomads in July 2022, the Parliament amended the Law on foreigners, which regulates 
the  stay  of  digital  nomads,  as  part  of  the  broader  efforts  to  attract  foreign  teleworkers  to 
Montenegro.  

Efforts  to  improve  the  regulatory  business  environment  decelerated.  The  dynamic 
development of local companies and foreign investors’ activities is hindered by weaknesses 
in  the  regulatory  environment,  such  as  inefficiencies  and  delays  in  dealings  with  the 
administration, excessive complexity of the legal framework, and  the administrative burden 
of  local  taxation  and  parafiscal  charges.  Further  obstacles  are  related  to  insufficient 
transparency  in  decision-making,  arbitrary  interpretation  and  law  enforcement  by  public 
authorities, and access to finance for SMEs. Systematic involvement of business partners in 
designing  and  drafting  measures  that  affect  businesses  remains  the  focus  of  the 
Competitiveness  Council,  but  in  2022,  the  level  of  activity  declined  due  to  the  political 
stalemate and uncertainty. The standstill in the decision-making of public administration also 
played a part in the slowdown in digital transformation reforms, which already suffered from 
a series of large-scale cyberattacks on the state’s IT infrastructure in the second half of 2022. 
Due  to  the  cyberattacks,  the  single  online  portal  for  SME  support,  which  provides  all 
necessary information and contacts regarding advice and assistance for businesses, has been 
disabled since August 2022, and its update is ongoing. At the end of 2022, 382 services were 
available  on  the  eGovernment  Portal,  of  which  73  were  electronic,  254  for  businesses,  109 
for citizens, and the rest for the public administration. 

The  government  is  yet  to  develop  specific  reform  measures  to  reduce  the  informal 
economy, which is a major obstacle to Montenegro’s competitiveness. Deficiencies in the 
institutional  and  regulatory  environment,  weaknesses  in  the  labour  market,  insufficient 
enforcement capacity of public authorities, corruption and tax non-compliance are conducive 
to informality, which is especially harmful to legally operating SMEs and microenterprises in 
the service sector. In July 2022, the Ministry of Finance published the results of a survey on 
informality,  estimating  the  size  of  the  informal  economy  at  20.6%  of  GDP,  considering 
businesses and employees working in the formal sector. However, this estimate increases to 
37.5% of GDP when including the fully informal sector. The government has yet to act on the 
survey’s recommendations. The adoption of a comprehensive action plan on informality was 
postponed again, to the end of 2023. 

State influence on product markets 

While  the  most  recent  tax  measures  aimed  to  contain  price  increases,  a  broader  issue 
relates  to  ensuring  transparency  and  efficiency  of  State  aid  in  Montenegro.  The 
government reduced excise duties on the sale of unleaded fuel and gas oils by 50% in June 
2022. When global oil prices stabilised, this reduction was revised, and finally abolished. The 
decision to reduce the VAT rate on the sale and import of basic foodstuffs (flour, sunflower 
oil, and salt) expired at the end of 2022, while the decision to reduce the VAT rate on bread 
(to 0%) and heating pellets (from 21% to 7%) is valid until the end of 2023. In March 2023, 
the  government  launched  a  ‘Stop  Inflation’  programme  in  cooperation  with  the  country’s 
largest supermarket chains, in an effort to address the problem of surging staple food prices 
and to lower inflation expectations. The Agency for Protection of Competition (APC) carried 
out  fewer State aid  investigations in  2022  than in 2021.  In August 2022, the APC issued  a 
third decision ordering further recovery of illegal State aid to the major State aid beneficiary, 
Montenegro Airlines. The responsible Ministry of Capital Investments is still to adopt a plan 
and take action to recover the funds. In January 2023, EPCG, a state-owned national electric 

72 

 
 
power company, notified the APC of the purchase of the troubled steel producer Niksic, only 
after  the  contract  was  signed  in  late  2022.  The  APC  has  not  yet  published  any  opinion  or 
decision concerning this case.  

Privatisation and restructuring 

Advancing  reforms  and  privatisation  of  SOEs  and  improving  their  governance  and 
profitability  remain  a  challenge.  The  caretaker  government  stepped  back  from  previous 
plans to formulate the state’s ownership strategy and set out a portfolio of key companies that 
should  remain  in  state  possession,  and  improve  SOEs’  management  practices  and  financial 
performance. As there was no political agreement on the direction and scope of such reforms, 
the  government  also  stepped  back  from  its  plans  for  a  holding  company  to  manage  and 
reform SOEs and limited the scope of its 2022 measures to set up a small unit in the Ministry 
of Finance to monitor fiscal risks related to SOEs. The performance of Montenegro’s SOEs, 
including  those  at  the  local  level,  could  be  enhanced  by  transforming  SOEs’  management 
structures, eliminating political patronage and improve financial performance to reduce fiscal 
risks.  Privatisation  did  not  make  much  progress,  as  the  government  decided  to  increase  the 
state capital in some SOEs, with the revised 2022 budget earmarking EUR 25 million for this 
purpose for the health institute of Simo Milosevic in Herceg Novi, the Meljine hospital, and 
wine  producer  Plantaze.  The  government  also  increased  its  ownership  in  the  port  of  Bar  to 
ensure  a  two-third  majority  in  the  managing  board.  In  December  2022,  the  government 
decided to reintegrate the bankrupt (privatised) Meljine hospital into the public health system 
until  the  ongoing  court  proceedings  are  finalised.  The  government  is  yet  to  decide  on  the 
restructuring  of  wine  producer  Plantaze’s  tax  debt.  In  February  2023,  the  government 
assigned the operation of the only ferry line crossing the Boka bay to the public company for 
coastal  zone  management  (Morsko  dobro),  in  an  apparent  violation  of  public  procurement 
rules  and  transparency.  At  the  same  time,  the  government  annulled  its  2019  decision 
assigning  the  management  of  the  ferry  line  in  the  Boka  bay  to  a  local  private  company 
(Maritime transport).  

Functioning of the financial market 

Financial stability 

The banking system remains stable and liquid, but the quality of banks’ balance sheets 
needs  close  monitoring  in  a  rising  interest  rate  environment.  Despite  the  expiry  of 
pandemic-related  support  measures,  the  banking  system  maintained  strong  capital  and 
liquidity buffers, both of which exceeded pre-COVID-19 levels. However, risks remain to be 
closely  monitored,  in  particular  in  view  of  recent  strong  credit  growth  and  rising  global 
interest rates. The capital adequacy ratio stood at 19.3% in late 2022, well above the statutory 
minimum  of  10%.  Banks  continued  to  fund  themselves  mainly  through  domestic  deposits. 
Non-performing loans made up 5.7% of total loans at the end of 2022,  down from 6.2% in 
2021.  The  banking  system  recorded  a  significant  profit  of  EUR  83.3  million  at  the  end  of 
2022, compared with EUR 27.5 million 1 year earlier. 

Access to finance 

Credit activity continued to grow, supporting the corporate sector in particular. Annual 
loan growth  decelerated  slightly to  6.1% in  2022,  from  6.6% in  2021, before  recovering to 
over  10%  in  January-February  2023.  The  main  driver  was  lending  to  businesses  and 
households (rising by 9% and 6.7% year on year, respectively) throughout the whole period, 
while  there  was  a  rapid  increase  in  inter-bank  lending  in  early  2023.  Loans  to  the  public 
sector  have  been  declining  since  the  beginning  of  2022.  The  recovery  of  the  economy  was 
reflected in a very fast increase in banks’ deposits, whose growth rate accelerated from 12.8% 
73 

 
 
year on year in 2021 to 23.3% in 2022 and continued to expand at over 20% year on year in 
the  first  2 months  of  2023.  Non-resident  deposits  accounted  for  around  one  fourth  of  all 
deposits  during this period. Borrowing costs increased with  the nominal weighted averaged 
lending rate reaching 5.3% in early 2023, compared with 4.3% at the end of 2021.  

The size of the non-bank financial sector remains very limited. Microfinance is the most 
commonly  used  source  of  alternative  finance,  with  the  sector’s  assets  accounting  for  some 
1.3%  of  GDP  in  2022.  The  role  of  insurance  in  the  local  economy  is  also  limited  as  their 
assets declined slightly to 1.8% of GDP in 2022.  

Functioning of the labour market 

With  the  economic  recovery,  labour  market  indicators  also  continued  to  improve  and 
levels,  but 
surpassed  pre-crisis 
structural 
remain. 
challenges 
According to the labour force survey 
(LFS),  the  average  unemployment 
rate  declined  to  15%  in  2022,  down 
from  16.8%  in  2021.  The  number  of 
employed  rose  by  18.2%  and  the 
average  employment  rate  stood  at 
57.5%.  Despite  these  improvements, 
the  2022  LFS  results  once  again 
confirmed  large  regional  disparities, 
with the unemployment rate standing 
at 5.6% in the tourism-heavy coastal region, at 9.3% in the central region, and at 31.6% in the 
poorer northern region. The gender gap widened after the pandemic, but the unemployment 
rate  of  women  (aged  15-64)  declined  faster  (by  2.3 percentage  points)  than  that  of  men  in 
2022, while women’s activity rate (61.4%) remained significantly below that of men (73.9%). 
Remaining  major  structural  challenges  are  youth  unemployment,  standing  at  29.4%  for  the 
population aged 15-24, and long-term unemployment, as 75.6% of all unemployed have been 
looking  for  a  job  for  more  than  12 months.  Despite  ongoing  reform  efforts,  the  public 
employment  service’s  capacity  for  job  mediation  remains  weak  and  lacks  a  continuous 
monitoring  of  active  labour  market  policies,  which  in  turn  prevents  the  design  of  quality, 
targeted  and  effective  employment  activation  measures.  The  Employment  Agency  of 
Montenegro’s  reform  and  readiness  remain  key  challenges  and  are  important  for  not  only 
implementing the Youth Guarantee, but also for ensuring a healthy, well-functioning labour 
market in the long term. The average gross wage increased by 11% in nominal terms to EUR 
883,  while  the  average  net  wage  rose  by  nearly  34%  to  EUR  793  in  2022,  supported  by  a 
large decline in the labour tax wedge. 

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

Montenegro  has  made  limited  progress  and  is  moderately  prepared  to  cope  with 
competitive pressure and market forces in the EU. The education system still faces numerous 
challenges,  as  shown  by  the  results  of  international  tests.  Although  public  financing  of 
research  and  development  remains  modest,  some  progress  was  made  in  attracting  private 
investors.  Efforts  to  advance  a  green  and  digital  transition  have  continued,  but  large 
infrastructure  gaps  persist.  The  administrative  and  financial  capacity  to  identify,  prioritise 
and implement major public investments remains limited, hampering the use of EU support. 
Despite some progress in the metallurgy sector and the good performance of tourism, further 
efforts are needed to diversify Montenegro’s narrow production base. The low value added of 

74 

404550556065700102030201720182019202020212022Graph 2.4: Montenegro -Labour market trends(15-64 age group)Unemployment rate (lhs)Participation rate (rhs)Employment rate (rhs)Source: Monstat 
 
domestic products, the small size of local companies, and their low level of participation in 
exports represent obstacles to increasing the productivity and competitiveness of local firms. 

The 2022 recommendations were implemented to a limited extent and remain mostly valid. 
In the coming year, Montenegro should in particular: 

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

→  improve programmes for dual vocational education and training and tertiary education in 

close cooperation with business associations; 

→  improve the institutional and regulatory environment for the green transition and increase 
energy  resilience  by  adopting  the  national  energy  and  climate  plan  and  completing  the 
implementation of the national energy action plan; 

→  implement the public investment management assessment recommendations, prioritising 
key  public  infrastructure  works  within  the  available  fiscal  space  while  avoiding 
exceptions regarding project selection. 

Education and innovation 

The  quality  of  education  needs  further  improvements.  A  comprehensive  2015-2020 
education  sector  analysis  (ESA)  was  presented  in  November  2022,  focusing  on  early 
childhood,  primary  and  secondary  education.  It  underlined  a  low  level  of  education  quality 
(based on the results of the Programme for International Student Assessment and the Trends 
in International Mathematics and Science Study) both in the fourth grade of primary school 
and  in  the  first  year  of  upper-secondary  education.  An  additional  concern  relates  to  the 
distribution of scores, as in both tests, more than 40% of students are below the level of the 
international  benchmark  for  ‘low  performance’,  i.e.  not  reaching  the  minimum  levels  of 
competency, while only a negligible share of students had high achievements (less than 2%, 
compared  with  around  10%  on  average  in  OECD  countries  and  20%  or  more  in  the  best-
performing  countries).  The  ESA  underlines  the  need  to  provide  more  appropriate  school 
infrastructure  (70%  of  children  attend  primary  schools  with  insufficient  infrastructure)  and 
improve  the  curriculum,  the  qualifications  of  teachers,  the  quality  of  teaching,  enrolment 
rates,  and  the  provision  of  support  to  the  most  vulnerable  groups.  A  mismatch  of  skills 
remains  a  significant  challenge,  particularly  for  graduates  of  vocational  education  and 
training  or  higher  education,  despite  some  recent  efforts  to  improve  the  transition  from 
education and training to the labour market. Although tertiary educational attainment is still 
lower than the EU average, the labour market cannot absorb the numbers of tertiary graduates 
in certain areas, such as business and humanities. The OECD’s report on labour migration in 
the Western Balkans found that in Montenegro, 28% of respondents disagree with the claim 
that skills learned in the education system meet the needs of their job, and 51% of surveyed 
firms identify applicants’ lack of skills as a reason for unfilled vacancies.  

Public  and  private  investment  in  research,  development  and  innovation  is  low.  In  the 
European Innovation Scoreboard for 2023, Montenegro has a summary innovation index of 
47%  relative  to  the  EU’s  100%,  which  is  below  the  average  of  the  ‘emerging  innovators’ 
(50.0%).  While  the  country’s  index  has  been  improving,  the  performance  gap  with  the  EU 
has  widened.  The  links  between  academia,  research  institutes  and  business  are  still  weak. 
Only 2.2% of Montenegrin micro, small and medium-sized enterprises invest in research and 
development,  compared  with  22%  at  regional  level.  Research  staff  are  employed  almost 
exclusively  by  the  government  or  in  the  higher  education  sector.  With  a  rate  of  0.36%  of 
75 

 
 
GDP invested in research and development, Montenegro’s spending was just over one sixth 
of the EU-28 average (2.18% of GDP) in 2019. In parallel with strengthening its capacity, the 
Innovation Fund continued to administer a collaborative grants programme and an innovation 
voucher scheme to encourage cooperation between private-sector and research institutions in 
developing  innovative  projects  and  products.  As  a  result,  private  sector  investment  in 
innovation  projects  exceeded  EUR  1  million  in  2022.  Innovation  and  Entrepreneurship 
Center Tehnopolis Nikšič continued to help start-ups through seven support programmes, and 
in  parallel  worked  on  strengthening  cooperation  with  local  universities.  A  5-year  strategic 
plan  for  the  newly  set  up  Science  and  Technology  Park  Montenegro  was  developed  and  a 
public call for tenants is under preparation. 

Physical capital and quality of infrastructure 

Productivity-enhancing investment remains low. In 2022, the share of gross fixed capital 
formation in GDP declined slightly to 21.7%. There was a slowdown in private investment, 
while public investment increased slightly to 5% of GDP. Net FDI rose to 13.5% of GDP, up 
from 11.7% in 2021, with more than one third of these inflows going into real estate, driven 
partly by purchases by Russian citizens. 

Little  progress  was  achieved  in  improving  energy  infrastructure.  While  the  use  of 
renewable energy sources is high, there is a lack of diversification of renewable sources and 
insufficient focus on environmental standards in energy infrastructure projects (some 43% of 
the  electricity  production  in  2020  came  from  renewable  sources,  mostly  hydropower  and 
biomass).  Montenegro  needs  to  address  a  number  of  energy-related  challenges,  including 
energy  efficiency.  Montenegro  needs  to  take  a  strategic  decision  on  how  to  replace  the 
thermal  (lignite)  power  plant  in  Plevlja,  which  currently  produces  approximately  50%  of 
Montenegro’s electricity and is vital for security of supply and the stability of the country’s 
power  system  but  remains  the  main  polluter.  Finding  an  alternative  solution  for  energy 
production  did  not  progress,  as  any  decisions  in  this  regard  are  not  expected  until  the 
government  has  adopted  the  national  energy  and  climate  plan  in  2024.  With  regard  to 
offshore  exploration  and  production  of  hydrocarbons,  two  concession  contracts  signed  in 
2016 with Eni and Novatek were terminated in December 2022, following negative results of 
explorations, while the 2017 contract with Energean expired in July 2022.  

Investment  in  digital  infrastructure  continued,  albeit  with  some  delay.  While  in  the 
previous  years,  Montenegro  made  steady  progress  with  digitalisation,  the  pace  of  digital 
transformation reforms slowed down in 2022, due to protracted political uncertainty, frequent 
organisational changes and a series of large-scale cyberattacks on the state’s IT infrastructure 
in  the  second  half  of  2022,  which  interrupted  the  timeline  of  the  digital  transformation 
reforms.  These  cyberattacks  spurred  Montenegro’s  government  to  focus  one  of  the  new 
reforms on cybersecurity. The telecoms operator auctioned the 5G spectrum and awarded it to 
three  major  operators  in  December  2022.  All  three  operators  are  obliged  to  activate  5G  in 
every municipality by the end of 2024 while providing 5G coverage to 50% of population by 
2026. 

Modernising the transport sector requires broad action. The strategic steer for developing 
the  sector  should  be  revised,  in  line  with  the  EU  development  priorities  and  Transport 
Community Treaty commitments (on sustainable and smart mobility), and move away from 
the  current  emphasis  on  road  transport.  Montenegro  scores  very  low  on  connectivity. 
Progress on improving and modernising short sections of the road and rail networks is slow 
and mainly thanks to EU funding. The first section of the Bal-Boljare highway was finished 
in  July  2022.  For  the  completion  of  the  entire  Bal-Boljare  highway,  an  outdated  feasibility 
study  needs  to  be  updated,  in  line  with  the  forecast  traffic  volumes  and  envisaging  a 
76 

 
 
multimodal  corridor,  encompassing  rail,  road  and  the  port  of  Bar.  Works  on  upgrading  the 
Bar-Vrbnica railway, a core network corridor, continued during the reporting period. Further 
action is needed to open up the rail market to competition and to complete regulatory reforms 
that  have  been  neglected  for  years.  The  (currently  suspended)  tender  for  a  concession  to 
maintain  and  upgrade  the  country’s  two  main  airports  in  Podgorica  and  Tivat  could  help 
address the country’s limited accessibility by air.  

Sectoral and enterprise structure 

The  structure  of  the  economy  remains  broadly  unchanged,  although  certain 
adjustments  are  taking  place  within  sectors.  Micro,  small  and  medium-sized  enterprises 
constitute  the  backbone  of  the  Montenegrin  economy,  accounting  for  57.8%  of  total 
employees in 2022. They continue to be dominated by micro enterprises, accounting for 99% 
of all firms. Across sectors, the distribution of employment remained broadly stable in 2022, 
with  the  services  sector  absorbing  76.7%  of  total  employment,  while  industry  and 
construction  (19%)  as  well  as  agriculture  (4.3%)  accounted  for  much  lower  shares. 
Employment  in  the  ICT  sector  surged  by  48%  year  on  year  in  2022,  affected  by  the 
immigrant  workers  from  Russia  registering  businesses  in  Montenegro,  which  coincides 
nevertheless  with  a  severe  drop  in  knowledge-intensive  services  exports.  The  share  of 
agriculture in gross value added declined to 6.7% in 2021, compared with an average of 7.6% 
in the previous 10 years, while the shares of industry and construction were roughly stable at 
some 10% and 5%, respectively. Over the same period, the share of wholesale and retail trade 
increased to 14%, up from 12%. The metallurgy sector is undergoing a major transformation 
after  the  closure  of  aluminium  smelter  KAP  and  Nikšič  steelworks  due  to  unsustainable 
production  costs.  In  December  2022,  Nikšič  steelworks  was  taken  over  by  the  state-owned 
electric power company EPCG, which plans to repurpose the plant for solar panel production. 

Economic integration with the EU and price competitiveness 

External trade surged to a record high in 2022. Montenegro’s foreign trade expanded by 
43.9% year on year, while bilateral trade with the EU grew by 33.7%. Overall, trade openness 
(the  total  exchange  of  goods  and  services  as  a  share  of  GDP)  increased  significantly  to 
128.7% of GDP, largely surpassing pre-pandemic levels. Exports continued to be dominated 
by services, which at 40.6% of GDP exceeded goods exports (12.1% of GDP) by a very wide 
margin.  The  EU  remains  Montenegro’s  main  trade  partner,  accounting  for  30.3%  of  total 
exports and 44.3% of total imports of goods. CEFTA countries also constitute an important 
market,  accounting  for  41.7%  of  Montenegro’s  total  exports  and  26.1%  of  total  imports  of 
goods. The EU also remains the main source of FDI inflows for Montenegro, accounting for 
33%  of  total  FDI  inflows  in  2022,  compared  with  36.4%  in  2021.  Other  countries  with  a 
sizeable  share  in  Montenegro’s  FDI  inflows  include  Russia  and  the  United  Arab  Emirates, 
mainly  due  to  active  participation  of  investors  in  the  controversial  economic  citizenship 
programme.  Montenegro’s  price  competitiveness  was  damaged  by  a  widening  inflation 
differential with the euro area. 

77 

 
 
2.4. PUBLIC PROCUREMENT, STATISTICS, FINANCIAL CONTROL 

Chapter 5: Public procurement  

EU  rules  ensure  that  the  public  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 in between moderate and a good level of preparation in the area of public 
procurement.  Some  progress  was  achieved  in  2022  in  aligning  with  the  EU  acquis  and  in 
further improving the functioning of the electronic procurement system. 

The    recommendations  from  last  year  were  partially  implemented.  Therefore,  some  remain 
valid. In the coming year, Montenegro should, in particular: 

→  focus  on  the  effective  implementation  of  public  procurement  and  public-private 

partnership legislation; 

→  greatly reduce the number and value of negotiated procedures without a prior publication 

of contract notice; 

→  fully respect the public procurement rules in all cases.  

Institutional set-up and legal alignment 

The  legal  framework  on  public  procurement  is  well  aligned  with  the  EU  acquis. 
Amendments to the Law on public procurement entered into force in January 2023. Together 
with  the  related  implementing  acts,  these  amendments  further  aligned  Montenegrin 
legislation with the EU legal acts in this area. In February 2023, the government  adopted a 
report  on  the  implementation  of  the  2021-2025  strategy  for  enhancing  public  procurement 
and  public-private  partnership  policy  in  Montenegro  and  a  corresponding  action  plan  for 
2023.  

The  electronic  public  procurement  system  (CEJN)  is  fully  operational.  All  public 
procurement  procedures  in  the country are  conducted through the system. Improvements to 
the  CEJN  were  announced  in  2022,  but  were  postponed  to  the  end  of  2023.  These  include 
functional  connections  with  other  electronic  registers  of  the  state  (criminal  records  of  the 
Ministry of Justice, records on tax obligations and on mandatory social security contributions 
of the Revenue and Customs Administration and records of the Agency for the Prevention of 
Corruption).  

The tender for the  concession to  operate Airports  of Montenegro has been suspended since 
2020. For Montenegro to meet the requirements of this negotiating chapter, it is essential to 

78 

02040608020152016201720182019202020212022Graph 2.5a: Montenegro -Exports of goodsEUCEFTAOtherSource: WiiW% ofGDP02040608020152016201720182019202020212022Graph 2.5b: Montenegro -Imports of goodsEUCEFTAOtherSource: WiiW% ofGDP 
 
 
  
comply fully with the EU rules on and standards of fair and transparent public procurement, 
providing value for money, competition, and strong safeguards against corruption. 

Implementation and enforcement capacity 

Montenegro’s public procurement market corresponded to 8.74% of GDP in 2022 and the 
value  of  all  public  procurement  procedures  amounted  to  some  EUR 506 million.  This  was 
much  above  the  values  achieved  in  2021,  but  significantly  below  the  record  level  of  2020 
(13.1% of GDP, EUR 545 million). The use of the CEJN helped improve the implementation 
of  public  procurement  procedures  in  the  country,  with  a  shorter  average  duration  of 
procurement  procedures  and  an  increased  average  number  of  bids  per  procedure  (3.5)  in 
comparison  to  previous  years.  However,  the  number  and  value  of  negotiated  procedures 
without  a  prior  publication  of  contract  notice  remains  very  high,  at  over  11%  of  all 
procurements in terms of value, conducted through the CEJN. The use of such procedures by 
public authorities should be exceptional, given the potential for irregularities and corruption.  

In the area of monitoring of contract award and implementation, the Public Procurement 
Inspectorate  carried  out  266  checks,  which  was  11%  less  than  in  2021,  due  to  the  reduced 
number  of  inspectors.  Most  checks  related  to  contract  conclusion,  contract  execution  and 
implementation of simple procurements. 

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

The  capacity  to  manage  public  procurement  processes  improved  thanks  to  the  full 
implementation of e-procurement. However, the high number of small contracting authorities 
undermines  the  efficiency  of  procurement  processes.  In  particular,  the  capacity  of  small 
municipalities to conduct more complex procurement procedures, including for EU-financed 
projects, remains limited.  

The administrative capacity of the Directorate for Public Procurement Policy in the Ministry 
of  Finance  and  Social  Welfare  remained  stable.  The  Directorate  systematically  organises 
training  sessions  on  public  procurement  rules  and  preparation  courses  for  procurement 
officers.  The  Directorate  also  prepares  and  publishes  technical  instructions  and  expert 
guidance on procurement rules. 

Efficient remedy system 

The legislation on the right to appeal is in line with the EU acquis. Cases are handled by the 
Commission for the Protection of Rights in Public Procurement Procedures. The Commission 
is  currently  understaffed.  There  were  no  significant  delays  in  treating  and  resolving 
complaints and the remedy system works efficiently. 

The Commission for the Protection of Rights resolved 169 complaints in 2022. The number 
of complaints remained stable in comparison to the previous period, even though the number 
and  value  of  procurement  procedures  significantly  increased  year-to-year.  Appeals  to  the 
Administrative Court of Montenegro  were filed against some 16% of the cases resolved by 
the  Commission.  The  Administrative  Court  returned  roughly  half  of  these  appeals  to  the 
Commission for reconsideration.  

The  Supreme  Court  of  Montenegro  carried  out  six  extraordinary  reviews  of  the  decisions 
taken by the Administrative Court on procurement procedures and in five cases rejected the 
lawsuits  as  unfounded,  while  in  one  case  modified  the  decision  as  regards  the  costs  of  the 
dispute. 

79 

 
 
 
Chapter 18: Statistics  

EU  rules  require  Member  States  to  produce  statistics  based  on  professional  independence, 
impartiality, reliability, transparency and confidentiality. Common rules are in place for the 
methodology, production and dissemination of statistical information. 

Montenegro is moderately prepared in the area of statistics. Limited progress was made on 
last  year’s  recommendations.  Work  continued  on  harmonising  the  statistical  methodology 
with EU standards and increasing transmission of data to Eurostat. However, pending issues 
remain  regarding  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;  and  transmission  of  some  fundamental  datasets  such  as  government  finance 
statistics, as well as financial accounts and excessive deficit procedure tables to Eurostat. The 
planned national population and housing census requires careful handling by the authorities, 
notably as concerns sensitive issues of ethnicity, religion and language.   

The  recommendations  from  the  2022  report  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 by starting to transmit to Eurostat government finance statistical data, as 
well as properly filled excessive deficit procedure tables; 

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

recommendations and allocate sufficient resources to it. 

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 number of MONSTAT employees remains low at 60% of the number of posts 
envisaged in the organisation chart. The Ministry of Finance has still not made new premises 
available  to  MONSTAT.  This  remains  a  serious  issue,  as  the  current  building  is  not 
appropriate for a national statistical office. In 2022, MONSTAT carried out a user satisfaction 
survey and published the results on its official website.  

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.  

In the area of macroeconomic statistics, Montenegro improved the presentation of the gross 
national  income  (GNI)  inventory,  including  the  process  tables.  Compliance  with  national 
accounts  according  to  ESA  2010  is  at  medium  level.  In  the  next  period,  MONSTAT  should 
focus on improving estimates and updating and  extending the GNI inventory. Regarding the 
consumer price index / harmonised index of consumer prices (HICP), the automatisation of the 
data  processing  and  dissemination  process  was  completed.  MONSTAT  has  successfully 
corrected  the  aggregation  inconsistencies  in  the  HICP  back  series.  Montenegro  does  not 
produce the HICP at constant taxes and is working on its introduction, and it needs to improve 
the production of the house price index (HPI) and send the data to Eurostat. Montenegro sends 
quarterly  balance  of  payments  (BOP)  and  international  investment  position  (IIP)  data 
according to the methodology set out in the balance of payments and international investment 

80 

 
 
position manual  (BPM6) to  Eurostat, but  it still  does not  send monthly  balance of payments 
statistics and needs to improve the geographical breakdown of BOP and IIP data. Government 
finance  statistics  (GFS)  were  never  sent  to  Eurostat  and  excessive  deficit  procedure  (EDP) 
tables are sent mostly empty. Work is also ongoing on amending the Law on official statistics.  

In  the  area  of  business  and  trade  statistics,  Montenegro  is  fully  compliant  for  7,  partly 
compliant for 5 and non-compliant for 2 datasets of the 14 short-term business statistics (STS) 
datasets (relevant out of the total of 16 STS datasets). Punctuality of the transmitted datasets is 
good and the reasons for non-compliance are partial coverage of NACE activities and lacking 
adjustments. Data on quarterly business demography and services producer prices is lacking. 
As  regards  structural  business  statistics,  Eurostat  received  some  data  in  2022  with  reference 
year  2020.  Compliance  in  the  area  is  low,  but  there  is  progress  compared  to  last  year.  On 
international trade in services, Montenegro is highly compliant, while on international trade in 
goods, there is medium compliance and further work is needed.  

In the area of  social statistics, the Parliament adopted the Law on the census  of population, 
households and dwellings in December 2022. The government decided that the census should 
be  carried  out  in  the  first  part  of  November  2023.  MONSTAT  is  preparing  for  the 
implementation  of  the  census  and  in  that  sense  cooperates  with  the  Administration  for 
Cadastre  and  State  Property,  and  local  authorities  responsible  for  updating  the  register  of 
spatial units. 

In the area of agriculture statistics, the preparation of the agricultural  census in accordance 
with the new EU legislative framework is ongoing and its implementation is planned for 2024. 
The population and housing census will be used to check who will need to be covered by the 
agricultural census.  

In  the  area  of  environmental  statistics,  Montenegro  is  considered  fully  compliant  on  waste 
statistics, but it does not report data on water statistics and on environmental accounts.   

Energy  statistics  are  overall  moderately  compliant.  MONSTAT  is  fully  compliant  with 
semestral statistics, but  on annual statistics progress is needed especially in terms of quality, 
while monthly statistics are non-compliant.  

Chapter 32: Financial control 

The  EU  promotes  the  reform  of  national  governance  systems  to  improve  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  in  the  area  of  financial  control.  Overall,  limited 
progress  was  made  in  implementing  last  year’s  recommendations.  A  new  public  finance 
management  reform  programme  was  adopted  in  December  2022,  which  means  that  the 
strategic framework for public internal financial control is now broadly in place. The reform 
programme  contains  measures  on 
the  application  of  managerial  accountability, 
complementing  those  in  the  public  administration  reform  strategy,  even  though  their 
implementation  is  still  limited.  On  external  audit,  the  State  Audit  Institution  improved  its 
capacity to monitor the implementation of audit recommendations and continued to work for 
more  open  and  transparent  communication  with  the  Parliament.  Nevertheless,  efforts  are 
needed  notably  to  further  strengthen  the  financial  management  and  to  complete  the  legal 
framework for the fight against fraud. Last year’s recommendations remain valid.  

In the coming year, Montenegro should in particular:  

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→  further  operationalise  the  centralised  budget  inspection  function  of  the  Ministry  of 

Finance, by allocating appropriate human resources;  

→  extend  the  application  of  managerial  accountability  in  public  administration,  with 
increased  delegation  of  authority  in  the  field  of  financial  management  and  internal 
control;  

→  further  align  its  legislation  with  the  EU  acquis  on  the  fight  against  fraud  to  the  EU’s 
financial interests and further strengthen the coordination capacity of the National Anti-
Fraud  Coordination  Service,  including  by  adopting  amendments  to  the  Criminal  Code 
and a new national anti-fraud strategy for 2024-2027. 

Public internal financial control (PIFC) 

Montenegro’s strategic framework for PIFC is broadly in place. The public administration 
reform  (PAR)  strategy  for  2022-2026  is  now  accompanied  by  a  new  public  finance 
management  (PFM)  reform  programme,  which  was  adopted  in  December  2022.  The 
government adopts annual reports on the implementation of the PAR strategy and the PFM 
reform programme as well as on governance and internal control in the public sector.  

As concerns managerial accountability, the new strategic framework provides a solid basis 
for  further  work,  as  both  the  PAR  strategy  and  the  PFM  reform  programme  include 
development  of  managerial  accountability  as  one  of  the  key  objectives.  However,  the 
application of managerial accountability in public administration remains limited, notably as 
concerns the delegation of authority in the field of financial management and internal control.  

The  legislative  and  operational  framework  for  internal  control  and  internal  audit  is  in 
place, covering also local government entities and state-owned enterprises. A revised Law on 
governance  and  internal  control  is  in  preparation.  The  legislative  framework  is  in  line  with 
international standards based on the Committee of Sponsoring Organizations of the Treadway 
Commission (COSO) framework. In November 2022, the government adopted implementing 
legislation  to  harmonise  the  internal  audit  system  with  the  Decree  on  the  organisation  and 
manner of work of the state administration.  

The legal and operational framework for  financial management control is largely in place 
and  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.  The  centralised  budget 
inspection function of the Ministry of Finance needs to be substantially strengthened. 

In the area of internal audit, there is no appropriate staffing at neither central nor local level. 
In  2022,  the  Ministry  of  Public  Administration  created  a  specialised  internal  IT  audit  unit 
carrying out IT audits in all public institutions. An internal IT audit strategy is in preparation.  

The  Central  Harmonisation  Unit  (CHU)  is  responsible  for  developing  and  disseminating 
methodological  guidance  on  PIFC,  and  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.  

At the level of PIFC, an anti-corruption system exists but requires further improvement.  All 
public  entities  are  informing  the  CHU  on  suspicions  of  irregularities  and  fraud  through  the 
reporting  system.  CHU  keeps  the  register  on  these  cases  and  monitors  the  mitigation 
measures and actions undertaken. However, very few bodies have reported any irregularities.     

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External audit 

The  Constitution  of  Montenegro  and  the  current  legal  framework  ensure  the  functional, 
operational  and  financial  independence  of  the  State  Audit  Institution  (SAI),  in  line  with  the 
standards  of  the  International  Organization  of  Supreme  Audit  Institutions  (INTOSAI).  The 
SAI further improved its institutional capacity in terms of auditing staff. Most of its auditors 
(90%) are certified and have access to internal and international training. The SAI president’s 
tenure ended in July 2022, but the Parliament has not appointed a new president yet. Also, the 
position of one of the five members of the SAI Senate remains vacant.  

On quality of audit work, the SAI adopts and implements its annual audit plan based on risk 
assessment and on clearly stated criteria. During the reference period, it performed 38 audits. 
The SAI improved its performance audit capacity. It now has more sectors, it can carry out a 
greater  number  of  parallel  audits,  and  its  audit  staff  have  improved  their  skills  by  attending 
training  programmes.  The  SAI  carried  out  a  self-assessment  of  its  work  by  applying  the 
international  methodology  for performance measurement, forming the basis for the strategic 
development plan of the SAI for 2023-2027, which was adopted in March 2023.  

The  SAI  continued  to  increase  the  impact  of  its  audit  work  by  improving  the  process  of 
monitoring  the  implementation  of  audit  recommendations  and  by  strengthening  cooperation 
with key stakeholders. All SAI reports are publicly available, and in 2022, the SAI also started 
to publish reports on the implementation of recommendations from audit reports. During the 
reporting period, the SAI published 30 such reports. Furthermore, the SAI drew up a register 
of audit recommendations, which enables the public to monitor the status of implementation 
of  audit  recommendations.  The  SAI  submitted  all  reports  timely  to  the  Parliament,  which 
considered the SAI’s annual report on performed audits and activities, including the audit of 
the  final  state  budget  account.  However,  the  Parliament  still  does  not  ensure  a  structured 
follow-up of the SAI recommendations.  

The Audit Authority increased its oversight capacity in terms of both human resources and 
the  number  of  performed  audits,  with  improvements  in  management,  accountability  and 
transparency  in  the  use  of  EU  funds.  In  November  2022,  the  government  appointed  a  new 
Head  of  the  Audit  Authority,  but  the  Authority’s  human  resources  are  yet  to  be  further 
strengthened as 12 positions remain vacant.   

Protection of the EU’s financial interests 

As concerns alignment with the EU acquis, amendments to the Criminal Code are yet to be 
adopted to fully align national legislation with the EU Directive on the fight against fraud to 
the EU’s financial interests by means of criminal law. Supported by an EU-funded twinning 
project,  the  Anti-Fraud  Coordination  Service  (AFCOS)  improved  its  capacity  to  fight 
irregularities and fraud and to coordinate the AFCOS network for the protection of the EU’s 
financial  interests.  A  new  national  anti-fraud  strategy  for  2024-2027  with  a  corresponding 
action plan is still not in place.  

Cooperation  and  exchange  of  information  with  the  European  Commission  (OLAF) 
during  investigations  remains  active.  The  cyberattack  of  August  2022  negatively  affected 
direct  communication  with  OLAF  as  the  Irregularity  Management  System  (IMS)  was 
disabled.  Despite  this,  five  new  irregularity  cases  were  reported  in  IMS.  Montenegrin 
authorities  should  continue  building  a  track  record  of  reporting  of  irregularities  and  of 
cooperation with OLAF on investigations.   

Protection of the euro against counterfeiting 

Montenegro’s  legislation  on  protecting  the  euro  against  counterfeiting  is  in  place.  The 

83 

 
 
country has the necessary  structures for technical  analysis  and  classification of counterfeit 
money, including euro banknotes and coins.  

Since 2021, the Decision of the Central Bank of Montenegro (CBCG) on authenticity and 
fitness  checking  and  recirculation  of  euro  banknotes  and  coins  has  been  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  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.  The  CBCG  continued 
cooperating  and  exchanging  information  under  agreements  signed  with  the  ECB,  the 
European  Commission  and  other  international  institutions  on  protecting  the  euro  against 
counterfeiting. Montenegro participated actively in the EU Pericles programme.  

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)  where  it  took  over  the  chairmanship  in 
January 2023, the Energy Community, the Transport Community, the South-East  European 
Cooperation  Process  and  the  Regional  Cooperation  Council.  From  1  July  2022  to 
30 June 2023,  Montenegro  chaired  the  South-East  European  Cooperation  Process.  The 
priorities of the Montenegrin Chairmanship-in-Office were to: strengthening of economic and 
security co-operation and infrastructural connectivity, protection of human rights rule of law, 
strengthening of democratic institutions, mitigating and overcoming the health, economic and 
other  consequences  of  the  Covid-19  pandemic,  environmental  protection  and  European 
integration  of  countries  from  the  region  of  Southeast  Europe.  Montenegro  also  actively 
participates  in  initiatives  such  as  the  Central  European  Initiative  (CEI)  and  the  Centre  for 
Security Co-operation (RACVIAC). 

The  EU-Western  Balkans  Summit  in  December  2022  took  place  for  the  first  time  in  the 
region,  in  Tirana.  The  summit  focused  on  support  to  the  region  in  the  fields  of  energy  and 
migration,  and  on  youth  cooperation,  roaming,  green  lanes  and  overall  progress  on 
implementing the Economic and Investment Plan.  

In  August  2023,  President  Milatovic  participated  at  an  informal  discussion  on  EU 
enlargement  in  Athens,  hosted  by  the  Greek  PM  Mitsotakis,  whereas  PM  Abazović 
participated at the Bled Strategic Forum together with the other WB leaders.  

On  the  Common  Regional  Market,  a  political  breakthrough  was  achieved  at  the  Berlin 
Process  Summit  in  Berlin  in  November  2022,  where  leaders  adopted  the  three  mobility 
agreements.  The  Parliament  has  ratified  all  three  Common  Regional  Market  agreements  on 
the  freedom  of  movement  based  on  identity  cards,  on  recognition  of  professional 
qualifications  for  regulated  professions,  and  on  recognition  of  academic  qualifications. 
However, the agreements have not yet been signed by the President.  A number of important 
decisions agreed at the technical level within CEFTA remain blocked.  

In  May  2023,  Montenegro  hosted  the  Connectivity  Summit,  which  achieved  a  joint 
declaration  Taking  forward  the  Green  Lanes  signed  by  all  participants,  and  a  high-level 
understanding  on  indicative  maps  of  the  trans-European  transport  network  in  the  Western 

84 

 
 
Balkans between the EU and the contracting parties to the Transport Community Treaty.  

Montenegro 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.  By  the  end  of  March  2023,  617  housing  units  had  been  built,  purchased  or 
reconstructed  in  Montenegro  under  the  Regional  Housing  Programme.  These  units  can 
accommodate 2 117 people. Significant challenges remain regarding the economic and social 
integration and wellbeing of many families, needed to ensure sustainability of return.  

Montenegro  continued  to  participate  actively  in  the  regional  Missing  Persons  Group  and 
contributed to the implementation of the provisions of its framework plan. The Commission 
on Missing Persons of Montenegro continued to cooperate with neighbouring countries under 
bilateral  cooperation  protocols.  There  are  51  active  cases  of  missing  persons  who  are 
Montenegrin citizens or whose families reside in Montenegro. 

Montenegro generally maintains good bilateral relations with other enlargement countries 
in the region and with neighbouring EU Member States. 

Relations with Albania remained good with occasional high-level bilateral visits. In February 
2023, the governments of Albania and Montenegro held the second joint government session 
in  Podgorica,  confirming  the  good  and  friendly  relations  between  the  two  countries.  The 
Prime  Ministers  signed  a  series  of  bilateral  agreements/memorandums  intended  to  improve 
cooperation in  several  areas of common interest  related to  energy, fishing,  plant protection, 
labour and social protection, sports, culture, media, defence, health and infrastructure. On the 
latter, an agreement for the construction of a bridge on the Buna River to connect the coastal 
areas  of  Ulcinj  (Montenegro)  and  Velipoja  (Albania)  was  reached  and  the  opening  of  the 
border point Saint Nicholas – Pulaj was announced.   

Relations  with  Bosnia  and  Herzegovina  remained  good  overall.  The  agreed  border 
demarcation is yet to be physically marked and three joint border crossing points remain to be 
set  up.  In  December  2022,  the  Council  of  Ministers  of  Bosnia  and  Herzegovina  and  the 
government of Montenegro signed a memorandum of understanding and cooperation on the 
implementation of infrastructure projects. The participation of the Montenegrin Finance and 
Justice  Ministers  on  9 January 2023  in  a  ceremony  in  Banja  Luka  celebrating  the 
unconstitutional  day  of  Republika  Srpska  sparked  strong  reactions  and  controversy  in 
Montenegro and regionally. In February 2023, the Minister of Foreign Affairs of Bosnia and 
Herzegovina paid an official visit to Podgorica.  

Relations  with  Kosovo  remained  good.  In  October  2022,  Montenegro  and  Kosovo  signed  a 
Memorandum  of  Understanding  on  co-operation  on  the  implementation  of  infrastructure 
projects.  The  President  of  Kosovo  visited  Montenegro  in  February  2023  and  the  Prime 
Minister of Montenegro visited Kosovo in April 2023. A number of meetings took place at 
the  level  of  Prime  Ministers  and  Foreign  Ministers  at  the  margins  of  international  and 
regional events.   

Relations with North Macedonia remained good. In February 2023, the Minister of Foreign 
Affairs of Montenegro and the Minister of Foreign Affairs of North Macedonia met in Skopje 
to  discuss  the  development  of  bilateral  relations,  regional  cooperation,  the  process  of 
European  integration,  and  the  strengthening  of  the  countries’  partnership  under  the  NATO 
alliance.  In  March  2023,  the  Prime  Ministers  met  at  the  margins  of  the  World  Economic 
Forum in Davos. The Foreign Minister of North Macedonia held meetings with the President 
and Prime Minister of Montenegro in the margins of the Adriatic Charter Meeting in March 
2023. The two Prime Ministers met in the margins of the Delphi Economic Forum in March 
85 

 
 
2023.  The  two  countries  signed  a  Programme  of  Cooperation  in  the  area  of  culture  for  the 
period 2023-2026. 

Relations  with  Serbia  are  overall  stable,  with  occasional  mutual  accusations.  In  September 
2022,  the  Prime  Minister  of  Montenegro  visited  Serbia,  for  a  wine  fair.  Controversy  was 
sparked  in  mid-December  2022  when  mayors  and  heads  of  local  assemblies  of  six 
Montenegrin  municipalities,  all  representatives  of  the  former  Democratic  Front,  attended  a 
session  of  the  Serbian  Parliament’s  Committee  for  Diaspora  and  Serbs  in  the  Region, 
discussing  the  position  and  status  of  ethnic  Serbs  in  Montenegro.  In  ministerial  meetings, 
economic  opportunities  and  the  strengthening  of  bilateral  cooperation  took  the  forefront 
rather than bilateral issues. After an inaugural visit to Brussels, in July 2023 the President  of 
Montenegro  paid  his  first  official  visit  abroad  to  Belgrade  to  discuss  with  the  President  of 
Serbia  the  appointments  of  Ambassadors  to  their  countries.  The  two  Presidents  met  again 
shortly after in Athens. In August 2023, the entry ban of the former Serbian Ambassador to 
Montenegro Bozovic, was lifted. 

Bilateral  relations  with  Türkiye  remained  stable.  Montenegro  provided  financial  and 
humanitarian assistance to Türkiye following the devastating February 2023 earthquakes. 

Relations  with  Ukraine  remained  good.  Montenegro  continued  to  provide  unequivocal 
support  to  Ukraine  in  light  of  the  Russia’s  war  of  aggression  including  humanitarian  and 
military  aid.  In  December  2022,  the  Prime  Minister  of  Montenegro  and  the  President  of 
Ukraine signed a joint declaration on the Euro-Atlantic perspective of Ukraine. 

Relations  with  the  Republic  of  Moldova  are  overall  good.  In  February  2023,  allegations  of 
Montenegrin  and  Serbian  football  fans’  involvement  in  destabilising  activities  promoted  by 
Russia in Moldova created short-lived tensions.  The Presidents of Montenegro and Moldova 
met  at  the  margins  of  the  European  Political  Community  in  Chisinau  in  June  2023. 
Montenegro  and  Moldova  also  maintain  relations  through  the  South-East  European 
Cooperation Process (SEECP). 

Relations  with  Georgia  are  generally  friendly,  although  the  level  of  engagement  is  not  as 
extensive  as  the  relations  with  other  enlargement  countries.  In  April  2023,  the  Parliament 
Speaker of the Montenegrin Parliament met her Georgian counterpart. 

Relations with Croatia remained good with occasional tensions arising in relation to pending 
bilateral issues and/or some historical events. In January 2023, the Prime Ministers met at the 
margins  of  the  World  Economic  Forum  in  Davos.  In  September  and  October  2022,  then 
Foreign  Affairs  and  Defence  Ministers,  together  with  their  Croatian  counterparts,  erected 
memorial plaques on the Croatian island Vis and at the former Yugoslav People’s Army-run 
Morinj detention camp in Montenegro, commemorating events from the 1990s. This caused 
controversy  and  the  Basic  State  Prosecution  Office  opened  a  preliminary  investigation 
against  the  Ministers.  There  was  no  progress  regarding  the  pending  border  demarcation 
between the two countries. The dispute between the two countries regarding the ownership of 
the sailing ship “Jadran” continues. In August 2023, the Croatian Ministry of Foreign Affairs 
sent a strong protest note to Montenegro due to Montenegro’s celebration of the ship’s 90th 
anniversary.  

Relations  with  Italy  remained  good.  In  June  2022,  the  Ministers  of  Defence  met  in  Rome, 
followed by meetings with the Chairman of the Defence Committee in the Lower House and 
the Chairman of the Defence Committee of the Senate. In July 2022, the Minister of Foreign 
Affairs met with the President of the Italian Chamber of Deputies. 

86 

 
 
 
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;    continued  alignment  with  the  Services  Directive  and  EU  postal  acquis; 
legislation  on  accounting,  work  on  a  new  company  law;  progress  on  acquis  alignment  on 
intellectual property rights, adoption of a new national comprehensive strategy on Intellectual 
Property  and  accession  to  the  European  Patents  Organisation  and  European  Patents 
Convention. State aid transparency and strengthening of administrative capacities, alignment 
of  the  banking  sector  of  Montenegro  with  the  latest  EU  acquis  also  advanced,  as  well  as 
adoption of implementation legislation on health protection.  

In the coming period, Montenegro is invited to focus on the following areas: alignment with 
the  EU  acquis  governing  standardisation;  step  up  efforts  to  improve  the  institutional  set-up 
and administrative capacity of the Employment Agency, establish a fully operational point of 
single contact, continue with the  implementation and enforcement of the new postal market 
rules,  continue  to  develop  qualifications    for  regulated  professions;  accelerate  progress  on 
electronic company registration, 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  company  law, 
finalise the revision of the Corporate Governance Code, start implementing the new national 
intellectual property strategy and the activities under its 2023 Action Plan; improve the track 
record  in  the  area  of  competition  and  State  aid,  adopt  a  plan  to  ensure  the  financial 
independence  of  the  Agency  for  the  Protection  of  Competition  and  progress  on  the  major 
State aid cases including follow up on the recovery of unlawful State aid; complete alignment 
of  national  legislation  with  the  EU  consumer  protection  and  health  protection  acquis; 
significantly  advance  work  on  the  insurance  and  capital  market  laws  aligned  with  EU 
legislation.  

Chapter 1: Free movement of goods  

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. Some progress 
was  made  overall,  by  further  aligning  national  legislation  with  the  EU  acquis,  notably  on 
technical requirements for products and conformity assessment as well as on standardisation 
and metrology.  Montenegro also took further steps to make the national standardisation body 
a full member of both the European Committee for Standardization (CEN) and the European 
Committee  for  Electrotechnical  Standardization  (CENELEC).  On  chemicals  management, 
legislation  and  a  new  2024-2026  chemicals 
Montenegro  adopted 
management  strategy.  The  sector’s  situation  in  terms  of  human  resources  and  funding 
improved  overall,  but  further  strengthening  of  the  quality  infrastructure  bodies  is  required. 

implementation 

87 

 
 
Therefore, some of last year’s recommendations remain valid.  

In the coming year, Montenegro should in particular: 

→  continue  to  align  its  legislation  with  the  EU  acquis,  as  envisaged  in  Montenegro’s 

accession programme; 

→  ensure the implementation and enforcement of the Montenegrin legislation on chemicals 

management that is aligned with the EU acquis; 

→  continue  to  strengthen  the  human  and  financial  capacity  of  its  quality  infrastructure 

bodies.  

General principles 

Montenegro  continued  to  make  progress  in  aligning  its  legislation  with  the  EU  acquis,  as 
envisaged in the national action plan. In December 2022, the Parliament adopted amendments 
to  the  Law  on  technical  requirements  for  products  and  conformity  assessment.  The 
amendments  introduce  a  ‘multilateral  clause’  for  all  products  belonging  to  the  non-
harmonised area. Under this clause, such products can be placed on the Montenegrin market 
without  additional  legal  obstacles  if  they  are  placed  on  the  market  of  the  EU,  the  EFTA 
countries and Türkiye. The government adopted implementing legislation on standardisation 
and  metrology.  In  March  2023,  the  government  adopted  the  2023  annual  plan  for  the 
adoption  of  Montenegrin  standards  and  related  documents  along  with  the  2023  work 
programme and financial plan of the Institute for Standardisation of Montenegro (ISME). 

Non-harmonised areas 

Montenegro  continued  to  implement  its  action  plan  for  compliance  with  Articles  34-36  of 
the  Treaty  on  the  Functioning  of  the  European  Union  (TFEU)  on  prohibition  of 
quantitative  restrictions  and  with  the  new  EU  Regulation  on  notification  of  technical 
regulations. 

Harmonised area: quality infrastructure 

As concerns standardisation, ISME published 1 952 Montenegrin standards aligned with EU 
standards.  In  the  first  quarter  of  2023,  CEN/CENELEC  assessed  ISME’s  adoption  rate  at 
almost 91% of European standards at national level (89.27% for CEN standards and 91.46% 
for  CENELEC  standards),  representing  a  slight  improvement  over  the  year.  Following 
ISME’s application for full membership of CEN/CENELEC, CEN/CENELEC conducted an 
assessment  visit,  during  which  it  identified  eight  non-conformities.  In  January  2023, 
CEN/CENELEC  sent  formal  recommendations  to  ISME  to  revise  its  action  plan  to  ensure 
fulfilment  of  all  required  criteria.  ISME’s  human  resources  require  further  strengthening  as 
only  77%  of  established  job  positions  are  filled.  ISME’s  2023  budget  increased  by  62% 
compared to 2022. 

On  metrology,  the  capacity  of  laboratories  for  temperature  and  pressure  and  for  testing 
precious metal articles improved. The Bureau for Metrology recruited two new staff but kept 
the same number of posts overall (49).  

The  Accreditation  Body  of  Montenegro  (ATCG)  accredited  44  conformity  assessment 
bodies (26 testing laboratories, 2 calibration laboratories, 2 medical examination laboratories, 
8  inspection  bodies,  3  bodies  for  product  certification  and  3  bodies  for  certification  of 
management systems), broadly similar to the last reporting period. Of these, two accredited 
conformity assessment bodies are temporarily suspended.  In October 2023, ATCG signed a 
Multilateral  Agreement  in  the  framework  of  the  European  co-operation  for  Accreditation 

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(EA).  

On  market  surveillance  of  products,  inspection  services  carried  out  3  487  market 
surveillance  inspections  (3  114  inspections  in  the  area  of  proactive  surveillance  and  373 
inspections  in  the  area  of  reactive  surveillance)  compared  with  2 137  in  the  previous 
reporting  period.  A  total  of  1  284  types  of  dangerous  and  non-compliant  products  were 
identified (37 504 items). Relevant inspection services imposed corresponding administrative 
measures. The Administration for Inspection Affairs recruited two new health inspectors, but 
it needs further staff.  

Harmonised area: sectoral legislation 

Regarding  ‘new  and  global  approach  product  legislation’,  Montenegro  amended 
implementing  legislation  in  the  areas  of  construction  (transitioning  to  Eurocodes),  energy 
efficiency  and  eco-design  to  ensure  further  alignment  with  the  EU  acquis.  Since 
1 January 2023, the application of Eurocodes for calculating building structures is mandatory 
in Montenegro.  

Similarly,  on  ‘old  approach  product  legislation’,  the  government  adopted  implementing 
legislation on dangerous chemicals  and on the  content of information  on cosmetic products 
placed  on  the  market  to  increase  the  level  of  alignment  with  the  relevant  EU  acquis.  The 
government  adopted  a  number  of  secondary  legislative  acts  to  implement  the  Law  on 
chemicals,  and  the  new  chemicals  management  strategy  for  2024-2026  was  adopted  in 
August 2023.  

National legislation is not yet aligned to the latest EU acquis on motor vehicles, two or three 
wheeled vehicles, tractors (agricultural, forestry), or non-road mobile machinery emissions. 

On  procedural  measures,  Montenegro’s  legislation  is  aligned  with  the  EU  acquis  as 
concerns  the  technical  requirements  on  crystal  glass  and  textile  labelling.  In  the  reporting 
period,  the  maximum  prices  of  all  medicines  were  set  according  to  Montenegro’s  legal 
framework and made publicly available.   

As concerns anti-corruption measures under this chapter, the Administration for Inspection 
Affairs  adopts  annually  an  integrity  plan  that  determines  anti-corruption  measures  and 
identifies risks.  In addition, Montenegro’s Law on medicines contains provisions aiming at 
the prevention of corruption.   

Chapter 2: Freedom of movement for workers  

Citizens of one EU 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.  In  the  reporting  period,  limited 
progress  was  achieved  related  to  the  further  conclusion  of  bilateral  social  security 
agreements. Montenegro needs to address the long-standing recommendations to step up the 
administrative and technical capacity of the Employment Agency.  

In the coming year, Montenegro should in particular: 

→  step  up  efforts  to  reform  the  institutional  set-up  and  improve  the  administrative  and 
technical  capacity  of  the  Employment  Agency  with  a  view  to  ensure  the  provision  of 
relevant and evidence based active labour market policies; 

→  further strengthen structures to implement the EU acquis in this area; 

→  continue to work on the conclusion of further bilateral social security agreements. 

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Concerning access to the labour market, there were no major legislative developments. The 
constitutive  meeting  of  the  Chapter  2  Working  Group  only  met  once,  on  27 March 2023 
during  which  the  new  membership  structure  of  the  group  was  confirmed  and  the  accession 
programme  of  Montenegro  for  2023-2024  was  discussed.  The  Commission  notes  that  the 
Action Plan related to the implementation of EU acquis in this area expired in 2022. In July 
2022, the Parliament adopted amendments to the Law on foreigners that defined the concept 
of  digital  nomads  and  introduced  temporary  residence  permits  for  the  said  category  of 
persons.  Furthermore, three rulebooks related to this Law were adopted. These amendments 
are  part  of  broader  efforts  to  create  sustainable  solutions  to  attract  foreign  companies’ 
teleworkers  to  Montenegro.  Work  is  ongoing  on  further  amendments  to  the  Law  on 
foreigners to align with a number of EU directives to ensure that EU migrant workers enjoy 
same work conditions, social and tax exemptions as domestic workers.  In November 2022, 
due  to  lack  of  administrative  and  technical  capacity,  the  government  decided  to  postpone 
until  EU  accession,  the  application  of  procedures  for  handling  foreigners’  requests  for 
temporary residence and seasonal employment permits through Montenegro’s representations 
in  their  countries  of  origin.    Based  on  the  Decision  on  determining  the  annual  number  of 
permits for temporary residence and work of foreigners for 2023, in the period January-May 
2023, a total of 14,185 permits for temporary residence and work were issued, which is about 
30% more compared to the same period of the previous year. 

In preparing to join EURES (European network of employment services) upon accession to 
the  EU,  there  were  limited  developments  due  to  delays  in  launching  technical  assistance 
projects. A twinning project to strengthen the capacity of the Employment Agency started in 
April 2023.  On the coordination of social security systems, the number of signed bilateral 
agreements  in  force  is  24.  An  agreement  on  social  insurance  was  signed  with  Albania  in 
February 2023. The ratification of the said agreement is pending in Parliament. In December 
2022,  the  Parliament  ratified  the  Agreement  on  Social  Security  between  Montenegro  and 
Romania. Negotiations  with  Serbia and Bosnia and Herzegovina remain pending.  The draft 
Law on Voluntary Pension Funds is being prepared, to allow additional retirement rights of 
employees and self-employed persons in the context of freedom of movement of workers. 

The European Health Insurance Card is recognised under the Law on compulsory health 
insurance but will only be introduced after EU accession. No progress was achieved during 
the  reporting  period.  The  number  of  agreements  with  EU  Member  States  on  the  use  of  the 
card remained at five (Austria, Germany, Luxembourg, Slovakia and Slovenia). In line with 
the 2022 Health Insurance Fund staffing plan, three executors were hired for the position of 
senior adviser for international health insurance (Regional Units: Podgorica, Bar and Herceg 
Novi) through a public call. A public call was launched in March 2023 for two further similar 
posts in Pljevlja and Bijelo Polje. 

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. EU rules on postal  services focus on improving the quality of 
universal  service,  gradual  market  opening  to  competition,  and  the  establishment  of  an 
independent regulator.  

Montenegro  remains  moderately  prepared  in  this  area.  Limited  progress  was  registered 
during the reporting period through the completion of alignment with the Regulation on cross 
border  parcel  delivery  services  as  per  last  year’s  recommendations,  which  remain  largely 
valid.  

90 

 
 
In the following period, Montenegro should in particular: 

→  set up a fully operational Point of Single Contact (PSC); 

→  continue  inter-ministerial  coordination  and  ensure  proper  monitoring  of  legislative 
alignment with the EU Services Directive, and the EU acquis on the mutual recognition 
of professional qualifications including the Professional Qualifications Directive and the 
Proportionality Test Directive, while continuing the implementation and enforcement of 
the new postal market rules; 

→  accelerate  the  alignment  of  all  study  programmes  with  the  Professional  Qualifications 
Directive and continue coordination with the Commission specifically on alignment with 
minimum training requirements under the Directive.  

On the right of establishment and freedom to provide cross-border services, Montenegro 
continued to align its sectorial legislation with the EU Services Directive, along with efforts 
to improve the mechanism to monitor this legislative alignment. As part of an EU technical 
assistance project, preparatory activities to set up a PSC for services portal were launched. A 
Decree  on  cooperation  and  exchange  of  information  between  institutions  for  access  and 
provision of PSC services was adopted in July 2023. Efforts to introduce electronic company 
registration continued, albeit at a much slower pace than in 2021.  

On postal services, the national legislation is aligned with the EU Postal Services Directive 
where Montenegro has made good progress over the years. The reserved area was abolished 
already in 2013, and complemented by bylaws to implement European quality standards for 
the provision of postal services in 2020.  Montenegro has also completed its alignment with 
the  EU  Regulation  on  cross-border  parcel  delivery  services  in  December  2022,  when  the 
Agency  for  Electronic  Communications  and  Postal  Services  adopted  amendments  to  the 
rulebook  on  the  type  and  method  of  submitting  data  by  postal  operators.  The  number  of 
postal operators is currently  26.  In April 2023, the government adopted the implementation 
report of the 2022 action plan on the postal development strategy and the 2023 action plan. A 
new  Strategy  for  the  Development  of  the  Postal  Service  for  the  period  2024-2028  is 
envisaged.  Montenegro  should  continue  monitoring  the  proper  implementation  and 
enforcement of the new postal market rules. 

On mutual recognition of professional qualifications, Montenegro has a satisfactory level 
of alignment with the EU acquis.  Montenegro, however, should follow up on measures set 
out  in  the  national  plan  to  develop  qualifications  for  regulated  professions:  this  will  ensure 
continuous alignment with the EU acquis. In April 2023, the Parliament adopted the Law on 
confirmation of the Agreement on the recognition of professional qualifications for doctors of 
medicine,  dentists  and  architects  under  the  Central  European  Free  Trade  Agreement  signed 
within  the  framework  of  the  Berlin Process.  This  law  is  currently  pending  signature  by  the 
President.    More  effort  in  the  alignment  with  the  minimum  training  requirements  of  all 
sectoral  professions  under  Directive  2005/36/EC  on  the  recognition  of  professional 
qualifications is needed.  

Chapter 4: Free movement of capital  

In the EU, capital and investments must be able to move without restrictions, with 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  during  the 
reporting period. The legal framework on payment systems was further aligned with the EU 

91 

 
 
acquis. The investor citizenship scheme was phased out at the end of 2022, but a number of 
pending applications are still being processed.  

All past recommendations not fully addressed remain valid. In the coming year, Montenegro 
should in particular: 

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

the acquisition of property rights by EU nationals; 

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

→  continue  to  monitor  risks  related  to  money  laundering  when  processing  pending 

applications to the investor citizenship scheme. 

In the area of capital movements and payments, since 2017, a regime of free movement of 
capital, no limitation on the transfer of property, and no foreign exchange or currency control 
has been in place. However, Montenegro needs to further align its legal framework with the 
EU  acquis.  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  nationals  can  buy  real  estate  or  farming  land 
under the same conditions as Montenegro nationals. 

As regards the payment system, the Parliament adopted amendments to the Law on payment 
systems in September 2022 to align it with the EU acquis. Four implementing acts to this law 
were adopted by the Central Bank of Montenegro, to align the regulatory technical standards 
in the area of payments to the ones of the EU. Further to the adoption in December 2021 of a 
Law  on  comparability  of  fees  related  to  consumer  payment  accounts,  payment  account 
switching  and  payment  accounts  with  basic  features,  in  September  2022,  the  Central  Bank 
adopted two implementing regulations, which entered into force on 9 January 2023.  

In the area of anti-money laundering and terrorist financing, Montenegro has yet to align 
its  legal  framework  with  the  fifth  Anti-Money  Laundering  Directive  and  with  the 
recommendations of the Financial Action Task Force. Amendments to the Law on games of 
chance  were  prepared  but  have  yet  to  be  adopted.  The  Law  on  international  restrictive 
measures, a crucial act against the background of international and EU sanctions, has yet to 
be aligned with EU standards. 

Montenegro currently has three payment institutions. The Central Bank continued to fulfil its 
supervisory  function  in  the  area  of  anti-money  laundering  and  prevention  of  terrorist 
financing. In  2022,  it  performed  regular  on-site  controls  of nine banks, one  payment 
institution, two  microcredit  institutions and one  company, to  check  the  compliance  of  their 
operations.  It  also  performed  one  thematic  targeted  control  upon  request  of  the  Financial 
Intelligence  Unit,  embedded  in  the  police,  and  several  follow  up  controls  of  financial 
institutions.  In  2022,  the  Directorate  for  supervision  in  the  area  of  prevention  of  money 
laundering  and  international  restrictive  measures  of  the  Ministry  of  Interior  conducted  136 
inspections of reporting entities. Some 65 misdemeanour orders were issued, for an amount 
of EUR 113 900. 

The Central Bank organised training sessions for the 28 reporting entities of Montenegro, to 
improve  their  knowledge  and  capacity  on  prevention  of  money  laundering  and  terrorist 
financing.  The  fifth  round  of  evaluation  of  the  Committee  of  Experts  on  the  Evaluation  of 
Anti-Money  Laundering  Measures  and  the  Financing  of  Terrorism  (MONEYVAL)  is 
ongoing.  

92 

 
 
The  economic  citizenship  scheme  expired  at  the  end  of  2022.  Between  January  2019  and 
December 2022, 556 applications were lodged (556 applicants  and 1 281 family  members). 
By 15 June 2023, the government had issued 954 positive decisions (293 applicants and 661 
family members). Some 398 applications were still pending on 15 June 2023 (398 applicants 
and  710  family  members).  Montenegro  should  closely  monitor  risks  related  to  money 
laundering when processing pending applications to the investor citizenship scheme, as such 
schemes  pose  risks  as  regards  security,  money  laundering,  tax  evasion,  terrorist  financing, 
corruption and infiltration by organised crime, and are incompatible with the EU acquis. 

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 in the area of company law. Limited progress 
was  made  on  the  2022  recommendations  by  adopting  the  implementing  act  to  the  Law  on 
accounting.  

All past recommendations not fully addressed remain valid. In the coming year, Montenegro 
should therefore, in particular: 

→  finalise, adopt  and start  implementing the draft  Company Law to  further align national 
legislation  with  the  EU  company  law  acquis  including  on  the  encouragement  of  long-
term  shareholder  engagement,  the  use  of  digital  tools  and  processes,  and  cross-border 
operations (mergers, divisions, conversions); 

→  complete alignment with the Transparency Directive, including the sanctioning regime; 

→  finalise the revision of the Corporate Governance Code. 

In the  area of  company law, Montenegro is  preparing a new company law to  further  align 
national  legislation  with  the  company  law  acquis  including  a  number  of  directives  in  the 
areas of long-term shareholder engagement, the use of digital tools, cross-border operations 
(mergers, divisions, conversions), employee participation in cross-border operations, and the 
directive on gender balance on corporate boards. No progress was registered on revising the 
Corporate  Governance  Code.  In  the  future,  the  national  business  register  should  be 
technically ready to interconnect with the EU Business Registers Interconnection.  

In the area of company reporting, the government adopted implementing acts to the Law on 
accounting, including rules on company financial statements. An initiative to further amend 
the  Law  on  accounting  was  launched.  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). 
Montenegro will need to align with 2022 EU Directive on corporate sustainability reporting. 
Legislative work to achieve full alignment with the acquis on transparency requirements for 
listed  companies  is  ongoing.  The  Capital  Market  Authority  operates  a  registry  as  the 
Officially  Appointed  Mechanism  for  the  central  storage  of  regulated  information.  An 
initiative  to  amend  the  Law  on  auditing  was  also  launched.  Statutory  audits  are  performed 
based  on  international  auditing  standards  (ISAs)  and  are  mandatory  for  public-interest 
entities. In February 2023, the government adopted a decision on the appointment of a new 
convocation  of  the  Audit  Council  (composed  of  the  chairperson  and  four  members).  The 
human  resources  capacity  of  the  Department  for  Audit  Oversight  was  strengthened  with  a 
quality assurance inspector, with two further posts to fill in the pipeline. Furthermore, a head 

93 

 
 
of accounting and one further independent adviser were appointed to the accounting division.  

Chapter 7: Intellectual property law 

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

Montenegro has a good level of preparation in the area of intellectual property law. Good 
progress was made in aligning national legislation with the EU acquis in the area of industrial 
property  notably  by  adopting  amendments  to  respective  Laws  on  patents  and  trademarks,  , 
and with the adoption of the new national intellectual property strategy, and accession to the 
European Patent Convention and the European Patent Organisation. However, improvements 
need  to  be  made  concerning    the  track  record  on  investigations,  prosecutions  and  judicial 
follow-up due to staff shortage.  

In the coming year, Montenegro should in particular:  

→  Start implementing the new and comprehensive national intellectual property strategy for 

2023-2026 and the activities indicated in the Action Plan for 2023;  

→  further  align  its  legislation  on  copyright  and  related  rights  and  enforcement  of 

Intellectual Property Rights (IPR) with the EU acquis; 

→  improve its track record on investigations, prosecutions and judicial follow-up including 

by addressing staff shortages. 

In the area of copyright and neighbouring rights, in January 2023, the government adopted 
the  Law  on  amendments  to  the  Law  on  copyright  and  related  rights,  which  was  positively 
assessed by the European Commission and is currently pending adoption by the Parliament. 
Amongst  other  things,  these  amendments  aim  to  align  national  legislation  with  three  EU 
Directives  on    certain  permitted  uses  of    works  and  other  subject  matter  protected  by 
copyright  and  related  rights  for  the  benefit  of  persons  who  are  blind,  visually  impaired  or 
otherwise  print-disabled,    coordination  of    certain  rules  concerning  copyright  and  rights 
related  to  copyright  applicable  to  satellite  broadcasting  and  cable  retransmission  and 
enforcement  of  intellectual  property  rights.  Montenegro  started  work  on  the  upcoming 
amendments to the Law on copyright and related rights, which will aim at implementing the 
Directive  on  online  transmissions  of  broadcasting  organisations  and  retransmissions  of 
television and radio programmes (SatCab II) and the Directive on copyright and related rights 
in the Digital Single Market.  

Concerning industrial property rights, in March 2023, Montenegro successfully completed 
the  test  phase  for  an  electronic  submission  of  applications  system.  On  1 October 2022, 
Montenegro became a member state of the European Patent Organisation and acceded to the 
European  Patent  Convention.  In  December  2022,  the  Parliament  adopted  the  Law  on 
amendments  to  the  Law  on  patents  for  alignment  with  the  EU  industrial  property  acquis 
concerning  the  supplementary  protection  certificate  for  medicinal  products,  the  Law  on 
amendments to the Law on trademarks to approximate the laws of the Member States relating 
to trademarks, and the Law on ratification of the Singapore Treaty on the Law on trademarks. 
In  March  2023,  the  Directorate  for  Intellectual  Property  completed  the  translation  of  new 
terms for the Harmonised Database. In June 2023, Montenegro acceded to the Geneva Act of 
the  Lisbon  Agreement  on  Appellations  of  Origin  and  Geographical  Indications:  its 

94 

 
 
ratification is pending by the parliament.   

On  enforcement,  in  March  2023,  the  Ministry  of  Economic  Development  and  Tourism 
approved the 2023 action plan of the Working Group for organising and implementing joint 
action to combat infringements of IPR. In addition, the Ministry participated in international 
joint customs operations with the aim to detect, inter alia infringements of IPR.  The number 
of misdemeanour warrants and the value of goods seized by the Administration for Inspection 
Affairs  –  Market  Inspection  show  a  slight  increase  in  comparison  to  previous  years.  In  the 
period June 2022 - April 2023, 729 controls were conducted, and 34 misdemeanour warrants 
were issued, amounting to EUR 34 600. More efforts are needed to improve the track record 
on  investigations  and  judicial  follow-up  including  addressing  shortage  of  staff  for  both 
sectors.  The  Unit  for  Copyright  and  Related  Rights  carried  out  a  special  check  of  the 
compliance of the operations of all collective organisations with the 2021 amendments to the 
Law on copyright and related rights related to collective management of rights.  

In July 2023, the country adopted the new national intellectual property strategy for 2023-
2026  and  its  action  plan  for  2023.  This  comprehensive  strategy  aims  to  improve  the 
efficiency  of  the  system  of  registration  and  enforcement  of  intellectual  property  rights,  by, 
inter alia, strengthening administrative capacity.   

Chapter 8: Competition policy 

EU rules protect free competition. They include antitrust rules against restrictive agreements 
between  companies  and  abuse  of  a  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, to prevent the distortion of competition.  

Montenegro  is  moderately  prepared  in  this  area.  Some  progress  was  made  by  further 
following  up  on  a  number  of  State  aid  cases  including  the  Montenegro  Airlines  and  Air 
Montenegro  cases,  by  adopting  secondary  legislation  in  the  field  of  State  aid  and  through 
recruitment of additional personnel thus strengthening the administrative capacity. Decisions 
and opinions issued by the State aid authority are timely published in the State aid registers, 
which further increases transparency. Last year’s recommendations remain valid.  

In the coming year, Montenegro should in particular: 

→  conclude  the  Montenegro  Airlines  case  and  follow  up  on  the  setting-up  of  the  new 
national  air  carrier  branded  Air  Montenegro  to  provide  clarity  on  state  aid  and  legal 
continuity between the two, as well as progress on other major ongoing investigations of 
non-notified/possible State aid (including UNIPROM KAP, Bar-Boljare highway) and if 
necessary, recover the corresponding funds; 

→  in  addition  to  ensuring  transparency  on  all  State  aid  decisions  and  operational 
independence  of  the  State  aid  authority,  prepare  legislation  to  empower  the  Agency  for 
the  Protection  of  Competition  (APC)  to  impose  fines  and  adopt  a  plan  to  ensure  the 
APC’s financial independence; 

→  further  improve  the  track  record  in  the  areas  of  antitrust/mergers  and  State  aid  by 
continuing  to  increase  staffing  of  the  APC,  building  the  administrative  capacity  of  the 
APC and of 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  is  broadly  aligned  with  the  EU  acquis  (Articles  101  and  102 
95 

 
 
TFEU)  and  the  Stabilisation  and  Association  Agreement.  The  Roadmap  for  implementing 
measures to achieve the closing benchmarks under Chapter 8 has not been finalised; efforts 
should  step  up  to  redraft  the  Roadmap  in  the  form  of  an  Action  Plan,  adopt  it  and  start  its 
implementation.  No  legislation  in  the  field  of  competition  was  adopted  in  the  reporting 
period.  In  June  2023,  the  Ministry  of  Economic  Development  and  Tourism  adopted  the 
Decree on the termination of the Block Exemption Decree.  

As regards the institutional framework, in August 2022, the APC adopted the rulebook on 
internal  systematisation  and  organisation,  which  is  a  positive  step  in  strengthening  its 
administrative  capacity.  The  APC  cannot  impose  administrative  fines  on  companies 
breaching  competition  law,  while  the  European  Commission  and  many  competition 
authorities of EU Member States have this power. In November 2022, the vacancy of APC 
director  was  finally  filled:    the  APC  director  was  appointed  for  a  period  of  5 years.  This 
completes  the  composition  of  the  APC  Council  and  should  significantly  facilitate  the 
implementation of APC’s activities.  

In the area of enforcement capacity, the APC’s administrative and financial capacity need to 
be strengthened. Only 13 out of the 18 planned posts in the area of antitrust and mergers are 
occupied.  The  APC was further strengthened  with  the  appointment of  eight  additional staff 
members.  

As regards implementation, concerning prohibited agreements, the APC issued one decision 
while  another  proceeding  is  ongoing.  Furthermore,  seven  procedures  for  individual 
exemption  from  prohibited  agreements  were  initiated  at  the  request  of  the  parties,  six  were 
resolved  (one  from  the  previous  period  and  five  from  the  current  period),  while  two 
procedures are ongoing. Out of five cases initiated before the Court, one case was resolved, 
while the other four cases are ongoing. The APC submitted a request to initiate proceedings 
for infringements before the Court, which are ongoing. 

In  the  reporting  period,  the  APC  issued  52  decisions  concerning  concentration.  During  the 
reporting period, one request  to  investigate a possible infringement  of competition  law was 
submitted to the APC and is ongoing. 

State aid 

The  legislative  framework  is  largely  in  line  with  the  EU  acquis  (Articles  107  and  108 
TFEU). The 2018 Law  on State aid  control sets  out  the notion of aid  as well as  procedural 
State  aid  rules.  Six  related  implementing  acts  were  adopted  during  the  reporting  period. 
These  set  out,  among  other  things,  instructions  on  how  to  calculate  the  equivalent  of  the 
subsidy and the return interest rate. However, it is essential to further amend the Law on State 
aid control and related implementing acts to ensure full compliance with EU State aid rules.  

As  regards  the  institutional  framework,  the  APC  is  responsible  for  enforcing  the  legal 
framework.  

The  enforcement  capacity  of  the  APC  Council  needs  further  strengthening.  It  has  seven 
employees in the field of State aid, the same number as in 2021. To strengthen its expertise 
and enforcement capacity, the APC should make significant efforts to recruit new staff and 
build  related  capacity.  All  concerned  institutions  should  help  strengthen  the  position  of  the 
APC and its Council to ensure an independent and functioning system of State aid control. It 
is imperative that grantors of potential State aid notify and consult with the APC ex ante with 
sufficient notification. The APC should be perceived as a partner by aid grantors – advising 
on State aid rules in specific cases. 

In  the  area  of  implementation,  in  2022,  the  APC  Council  adopted  45  State  aid  decisions. 

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Concerning  State  aid  to  Montenegro  Airlines,  in  August  2022,  the  APC  issued  a  third 
decision  ordering  further  recovery  of  illegal  State  aid.  The  bankruptcy  case  of  Montenegro 
Airlines is pending at the Commercial Court. The APC also initiated examination procedure 
on possible State aid granted to Air Montenegro between 2012-2017. In the cases of the Bar-
Boljare  highway  and  its  operations,  UNIPROM  KAP  and  the  Niksic  steel  mill,  the  APC 
started pre-examination activities. The APC also started examining investigations on possible 
State aid granted to the Plantaže company, which was disbursed without proper notification 
to  the  APC.  In  the  reporting  period,  two  recovery  decisions  were  adopted  and  appealed 
against before the Administrative Court. To prove a solid enforcement track record, the APC 
needs to have timely access to all necessary information to provide opinions and take binding 
decisions. The APC has not yet published any opinions or decisions concerning possible State 
aid  cases in  the energy sector. The APC should continue monitoring the implementation  of 
State aid rules in large projects carried out in cooperation with third countries.  

Montenegro  made  progress  towards  ensuring  transparency  on  State  aid  decisions,  with  the 
APC  publishing  decisions  and  opinions,  including  its  annual  reports,  on  its  website  in  a 
timely manner. Additionally, the APC created a general register of State aid cases, which can 
also  help  increase  transparency,  along  with  two  specialised  registers  (related  to  COVID-19 
and  de  minimis  aid).  The  APC  should  continue  to  advocate  for  further  strengthening  of 
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 Stabilisation and Association  Agreement. There is  no evidence  of the  existence of 
commercial monopolies within the meaning of Article 37 TFEU. 

Chapter 9: Financial services  

EU  rules  aim  to  ensure  fair  competition  among,  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. 

Montenegro  is  moderately  prepared  in  the  area  of  financial  services.  Overall,  some 
progress  was  achieved,  with  good  progress  on  bank  and  financial  conglomerates,  some 
progress on insurance; and limited progress on capital markets. Last year’s recommendations 
remain valid. 

In the coming year, Montenegro should: 

→  complete  legislative  alignment  with  the  latest  revisions  of  the  capital  requirements  and 

bank recovery and resolution legislation; 

→  continue to work on alignment with the insurance legislation, 

→  significantly  advance  work  on  the  draft  Law  on  investment  funds,  the  draft  Law  on 
alternative  investment  funds  and  the  draft  Law  on  pension  funds,  aligned  with  EU 
legislation. 

On  banks  and  financial  conglomerates,  legislation  is  largely  aligned  with  the  EU  acquis. 
Alignment  with  the  latest  bank  recovery  and  resolution  legislation  continued,  including  by 
drafting  amendments  to  the  Law  on  resolution  of  credit  institutions,  and  by  preparing  the 

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2023  resolution  plans  for  credit  institutions.  In  July  2022,  banks  made  their  first  annual 
contributions  to  the  Resolution  Fund.  In  December  2022,  the  Central  Bank  of  Montenegro 
adopted several implementing acts in the area of banking, including on capital adequacy of 
credit  institutions.  Work  was  also  initiated  on  a  draft  Law  regulating  the  area  of 
supplementary supervision of financial conglomerates. 

In  the  area  of  insurance  and  occupational  pensions,  in  the  second  half  of  2022,  the 
Insurance Supervision  Agency (ISA)  adopted several  implementing acts  to  the current  Law 
on insurance. Work continued on a new draft Law on insurance, aligned with the latest EU 
rules, in particular Solvency II Directive. In 2023, the ISA adopted implementing acts on the 
internal  organisation  and  governance  structures  of  insurance  companies  and  on  pre-
contractual information, bringing these aspects closer to EU standards. 

Regarding financial market infrastructure,  there were no relevant developments. Central 
Securities Depository and Clearing Company, supervised by the Capital  Markets  Authority, 
is the depository of securities, owner, and operator of the securities settlement system. 

On  securities  markets  and  investment  services,  in  the  second  half  of  2022,  public 
consultations were held  on the draft Law on alternative investment  funds, the draft Law on 
open-ended investment funds with public offering, and the draft Law on pension funds. Work 
on preparing the final drafts of these laws continued.  

In  the  area  of  sustainable  and  digital  finance,  Montenegro’s  National  Strategy  for 
Sustainable Development contains a chapter on financing sustainable development. In March 
2022, the Central Bank of Montenegro adopted a policy to reduce the adverse climate change 
impact on the financial system and on greening the financial system.  

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, and medicines for human and veterinary 
use. The EU also has rules for upholding patients’ rights in cross-border healthcare and in 
preparing  for  and  responding  to  cross-border  health  threats,  including  communicable 
diseases. 

Montenegro is moderately prepared in the area of consumer and health protection. Overall, 
limited  progress  was  made  on  last  year’s  recommendations.  Some  alignment  to  the  EU 
acquis  took  place  in  the  field  of  health  protection,  notably  the  Law  on  health  care  was 
adopted.  Also,  the  construction  of  a  mental  health  clinic  started,  and  the  capacity  of  the 
healthcare  institutions  to  fight  against  COVID-19  was  strengthened  by  targeted  financial 
allocations to  healthcare institutions. The composition  of the Consumer Protection Council, 
an  advisory  body  to  the  government,  was  changed  to  include  representatives  of  all 
stakeholders in the area of consumer protection. There is a need to strengthen administrative 
capacity  and  ensure  full  implementation  of  the  EU  acquis.  Last  year’s  recommendations 
remain valid. 

In the coming year, Montenegro should in particular: 

→  complete the alignment of national  legislation with  the EU consumer  protection  acquis 
and  health  protection  acquis  on  substances  of  human  origin,  tobacco  control  and 
patients’  rights  in  cross-border  healthcare,  as  set  out  in  Montenegro’s  accession 
programme; 

→  strengthen the role and effectiveness of the Council for Consumer Protection; 

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→  adopt  a  new  strategy  for  the  development  of  the  healthcare  system  and  start  its 

implementation.  

Consumer protection 

Regarding the legislative framework for consumer protection, several pieces of legislation 
are pending adoption: a law on consumer protection to align national legislation with the EU 
acquis on digital content, a law on collective actions to align national legislation with the EU 
acquis on representative actions for protection of collective interests of consumers, a law on 
consumer credits to align national legislation with the relevant EU acquis, a law on tourism 
and  catering  to  align  national  legislation  with  the  EU  acquis  on  package  travel  and  linked 
travel  arrangements,  and  amendments  to  the  Law  on  market  surveillance  to  fully  align 
national  legislation  with  the  latest  EU  acquis  in  this  area.  Further  alignment  should  be 
ensured with the EU consumer protection cooperation regulation. Some measures were taken 
to  implement  the  2022  and  2023  action  plans  under  the  national  consumer  protection 
programme (2022–2024). These included the appointment in October 2022 of members of 
the new Council for Consumer Protection, which met twice.  During  the reporting  period,  a 
consumer protection NGO won a collective lawsuit against a bank; the court found that the 
bank violated the Law on consumer credit and the collective rights of consumers.  

An EU peer-review visit concerning consumer protection concluded that Montenegro should 
ensure  timely  alignment  of  its  national  legislation  with  and  implementation  of  relevant  EU 
legislation,  speeding  up  legislative  processes  and  taking  a  more  proactive  approach  in 
the 
consultation  processes.  It  also  recommended 
administrative  capacity  of  its  market  surveillance  authorities,  in  line  with  its  relevant 
strategy and internal organisational structure; and (ii) develop relevant education and training 
programmes  and  allocate  additional  financial  resources  to  them.  Other  recommendations 
included  strengthening  support  to  the  non-governmental  sector  and  out-of-court  dispute 
resolution  mechanisms and strengthening the engagement of local  government in  consumer 
protection.   

that  Montenegro:  (i)  strengthen 

As concerns the protection of the economic interests of consumers, the Administration of 
Inspection Affairs carried out 33 259 inspections,  identifying 4 876 irregularities leading to 
administrative and punitive measures. 

Montenegro’s  legal  framework  on  product  safety  is  mostly  aligned  with  the  EU  acquis. 
During the reporting period, 3 487 inspections were conducted, of which 3 114 inspections in 
the area of proactive surveillance and 373 in the area of reactive surveillance. Based on these 
inspections, 1 284 types of dangerous and non-compliant products were found, amounting to 
37  504  items.  This  led  to  536  dangerous  and  non-compliant  products  (15  285  items)  being 
withdrawn from the market. Temporary circulation bans for products not posing a serious risk 
and  for  non-compliant  products  (until  the  removal  of  identified  non-compliances)  were 
imposed on 761 types of products (22 627 items).  

Public health 

National  legislation  on  public  health  is  partly  aligned  with  the  EU  acquis.  Implementing 
legislation  in  the  field  of  medically  assisted  reproduction  was  adopted  to  further  align  the 
national  legislation  with  the  EU  acquis  on  substances  of  human  origin.  In  2022,  the  state 
budget  for  the  health  sector  was  EUR 420 million,  an  increase  compared  to  2021.  The 
adoption of the 2023-2027 strategy for the development of the healthcare system is pending, 
while the Law on health care was adopted.  

On anti-microbial resistance, awareness-raising and education activities were carried out by 

99 

 
 
the  national  authorities,  the  World  Health  Organization  and  other  institutions,  including  on 
bacterial resistance to antibiotics, rational use of antibiotics and strengthening the diagnostic 
capacity in hospitals. However, further work on this remains necessary. 

On tobacco control, national legislation on smoking in public places and the sale of tobacco 
products to minors is still not sufficiently enforced. In May 2023, the government adopted the 
strategic document "Program for the control of the use of tobacco products 2023-2025 with 
the Action Plan 2023-2025".  

The government’s 2022-2024 programme on alcohol-related harm reduction and its related 
action plan are being implemented. However, there is no overview of the situation due to lack 
of data collection on harmful consequences of alcohol consumption. Regarding drug abuse 
prevention  and  harm  reduction,  civil  society  organisations  continued  their  prevention 
action and services, including some financed by the government. The public health institute 
organised  educational  activities  on  drug  addiction  for  56  service  providers  from  13  health 
institutions. 

In  February  2023,  the  Ministry  of  Health  published  a  report  on  the  implementation  of  the 
2021-2023 action plan for the mental health strategy for 2019-2023, showing that only 16% 
of  planned  measures  have  been  implemented.  In  July  2022,  the  construction  of  a  mental 
health  clinic  started,  still  in  process,  with  financial  support  from  the  government.  When 
completed, it will have Montenegro’s first child and adolescent psychiatry department.  

On  blood,  tissues,  cells  and  organs,  the  national  blood  transfusion  institute  continued  to 
ensure  that  enough  safe  blood  is  available  for  people’s  needs.  In  the  area  of  blood, 
Montenegro’s legislation is almost fully aligned to the EU  acquis. However, the system for 
reporting on adverse effects and reactions is not yet in place. 

Regarding  patients’  rights  in  cross-border  healthcare,  Montenegro  has  yet  to  adopt 
implementing legislation on conditions, means and procedures for administering cross-border 
healthcare.  

On communicable diseases, the Ministry of Health distributed more than EUR 5 million for 
the  fight  against  COVID-19  to  seven  healthcare  institutions  to  improve  their  capacity  and 
raise the level of their healthcare services. Regarding HIV/AIDS, the Institute for Education 
organised  training  sessions  for  teachers  and  educators,  while  civil  society  organisations 
continued their services for key population groups. Between September and December 2022, 
Montenegro  organised  its  first  human  papillomavirus  (HPV)  vaccination  programme.  It 
resulted in the vaccination of nine-year old girls. According to UNICEF, the coverage for the 
first vaccination dose against measles, mumps and rubella fell from 90% in 2010 to 18% in 
2022.  The  situation  is  mostly  due  to  focusing  resources  on  COVID-19  vaccination  and 
reluctance  of  parents  to  bring  their  children  to  health  centres  during  the  pandemic.  In 
February  2023,  the  government  adopted  a  programme  for  mandatory  immunisation  of 
population against certain communicable diseases and related implementing legislation.   

Implementation  of  the  programme  for  the  control  and  prevention  of  non-communicable 
diseases continued.  

In the area of health inequalities, vulnerable groups have access to healthcare services, with 
the  exception  of  persons  without  regulated  legal  status,  including  Roma  and  Egyptians  not 
having proper legal status. People, in particular the elderly, living in remote rural areas face 
difficulties  to  reach  health  care  facilities.    Also,  the  lack  of  accessible  healthcare  facilities, 
appropriate  equipment  and  special  healthcare  services  remains  a  concern  for  people  with 
disabilities.  

100 

 
 
According  to  a  public  survey  conducted  by  an  NGO,  almost  60%  of  people  living  in 
Montenegro  have  seen  corruption  in  the  healthcare  sector.  They  mostly  refer  to  irregular 
payments for health treatments, often voluntarily done by patients.   

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. signature of the Association  Agreement 
concerning  the  Digital  Europe  Programme,  tax  legislation  and  the  automatic  exchange  of 
bank  account  information;  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 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;  ensure practical  cooperation amongst  relevant  public 
authorities  and  develop  appropriate  capacity  to  produce  government  finance  statistics  and 
fiscal  notifications;  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; evaluate the results of its 2019-2023 industrial policy strategy and prepare a new 
industrial  policy,  in  cooperation  with  relevant  stakeholders;  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  finalise  all  preparations  for  the  accession  to  the  Convention  on  a 
common transit procedure.  

Chapter 10: Digital transformation and media  

The  EU  supports 
for  electronic 
communications, electronic commerce and audiovisual services. The rules protect consumers 
and support the universal availability of modern services.  

internal  market 

functioning  of 

the  smooth 

the 

Montenegro remains moderately prepared in the area of digital transformation and media. 
There  was  limited  progress,  mainly  directed  at  reducing  the  impact  and  addressing  the 
consequences of the August 2022 cyberattack by making the government’s IT infrastructure 
once  again  operational.  Montenegro  joined  the  Digital  Europe  Programme  in  June  2023. 
However, last year’s recommendations have not been met and remain valid.  

In the coming year, Montenegro should in particular: 

→  align  national  legislation  with  the  EU  acquis  on  electronic  communications  and 
the  operational 
technologies  and  on  audiovisual  media,  ensuring 

information 
independence of media regulators and the public service broadcaster; 

→  grant  the  Agency  for  Electronic  Media  (AEM)  powers  to  impose  a  complete  set  of 

101 

 
 
measures,  including  warnings,  fines,  suspensions  and  revocation  of  licences  ensuring 
proportionality and effectiveness; 

→  achieve a track record on enforcement of the EU acquis on electronic communications, 
information  society  services,  open  data  and  in  particular  audiovisual  media  services, 
including as regards regulatory independence. 

Concerning electronic communications and information technologies, Montenegro needs 
to  intensify  efforts  to  complete  the  alignment  of  its  national  legislation  with  the  acquis  on 
electronic communications and information technologies. Montenegro has not yet aligned its 
national legislation with the European Electronics Communication Code, the Toolbox for 5G 
Cybersecurity, the e-Privacy Directive and the eIDAS Regulation on digital identity and trust 
services.  

In  November  2022,  the  Ministry  of  Economic  Development  and  Tourism  set  up  a  working 
group to draft the Law on electronic communications. However, in April 2023, in a separate 
procedure,  the  Parliament  adopted  amendments  to  the  Law  on  electronic  communications 
with a view to dismiss existing members of the EKIP Council and Executive Director before 
the  end  of  their  mandate.  These  Amendments  were  proposed  by  a  number  of  Members  of 
Parliament,  without a public debate and despite a negative opinion from the Government and 
the Agency for Electronic Communications and Postal Services (EKIP). Such developments 
seriously risk intruding on the independence of the Agency. 

Work  continued  on  the  draft  strategy  for  the  development  of  5G  mobile  communication 
networks for 2023-2027. Broadband infrastructure development progressed with EU support. 
According  to  Montenegrin  statistical  information,  the  share  of  households  with  access  to 
fixed high-speed internet  (at  least  100 Mb/s) and the share of the population  with  access  to 
mobile high-speed internet both increased in 2022 compared to 2021, from 76.7% to 78.5% 
and  from  97.2%  to  97.5%,  respectively.  The  total  number  of  fixed  broadband  internet 
connections  increased  by  4.4%  compared  to  2021.  In  October  2022,  the  Agency  for 
Electronic  Communication  launched  an  auction  for  the  spectrum  in  the  700 MHz,  3.6 GHz 
and 26 GHz bands and awarded three existing telecom operators with frequency resources in 
the 700 MHz and 3.6 GHz bands. 

Regarding  digital  transformation,  the  Ministry  of  Public  Administration  (MPA)  should 
intensify  efforts  and  accelerate  alignment  of  the  national  legislation  with  the  Network  and 
Information  Security  Directive  (NIS  2)  and  the  Open  Data  directive.  Alignment  with  the 
Digital  Services  Acts  and  Digital  Markets  Act  needs  to  be  stepped  up,  to  provide 
predictability  for  the  business  community.  In  December  2022,  the  MPA  set  up  the  Digital 
Academy  –  an  online  platform  for  education  and  building  digital  and  leadership  skills  of 
public servants, students, and vulnerable groups. The signature of the Association Agreement 
to the Digital Europe Programme between the European Commission and Montenegro took 
place  in  June  2023  during  the  meeting  of  the  2nd  Regulatory  Dialogue  for  the  Western 
Balkans.  The  association  agreement  goes  into  retroactive  effect  from  1  January  2023.  It 
would be highly advisable to seek alignment with the new legislation in  place (namely, the 
Interoperable  Europe  Act)  and  with  the  services  related  to  the  Interoperable  Europe 
Academy.  A  massive  cyber-attack  at  the  end  of  August  2022  disrupted  the  work  of  public 
services,  businesses  and  people  alike.  The  official  gov.me  website  and  all  official  email 
accounts of civil servants at state level were not operational for several months.  In response, 
in December 2022, the MPA set up a new Directorate for Information Security known as the 
government CIRT (Computer Incident Response Team). At the end of 2022, the number of e-
government  services  was  403,  down  from  410  in  2021,  due  to  internal  reorganizing  and 

102 

 
 
preventive  actions  related  to  the  cyber-attack.  A  small  number  of  new  services  came  into 
operation,  including  applications  for  enrolment  in  preschool  institutions  and  student 
dormitories. 

The  Ministry  of  Culture  and  Media  is  responsible  for  audiovisual  policy.  In  the  area  of 
audiovisual  policy,  the  Regulatory  Agency  for  Electronic  Media  (AEM)  continued  to 
exercise its mandate in a professional manner. In September 2022, the AEM suspended the 
broadcasting  of  the  morning  TV  show  of  the  Belgrade-based  Pink  M  in  Montenegro  for  a 
period  of  6  months,  for  inciting  hatred,  intolerance  and  discrimination  against  ethnic 
Montenegrins.  The  AEM  still  lacks  the  authority  and  measures  to  effectively  monitor  and 
penalise broadcasters and rules, and its operational capacity has yet to be strengthened. 

The Law on audiovisual media services, the amendments to the Law on media, and the Law 
on the national public broadcaster have not been adopted yet. Montenegro urgently needs to 
fully  align  its  legislation  with  the  2018  revision  of  the  EU  Audiovisual  Media  Services 
Directive  (AVMSD)  and  with  the  recommendations  and  legal  opinions  of  the  Council  of 
Europe  and  the  Organization  for  Security  and  Co-operation  in  Europe  within  the  required 
timeline to ensure the country’s continued participation in all aspects of the Creative Europe 
Programme. The new rulebook on the distribution of funds from the Media Pluralism Fund 
entered into force in January 2023. In October 2023, Montenegro adopted its  media strategy 
for 2023-2027 together with  an accompanying action plan 2023-2024.  

Chapter 16: Taxation  

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

Montenegro is moderately prepared in the area of taxation. Overall, limited progress was 
made on last year’s recommendations.  Progress was made on tax legislation and in preparing 
the automatic exchange of bank account information.  

In the coming year, Montenegro should in particular: 

→  further remove value added tax (VAT) and other tax exemptions that are not aligned with 

the EU acquis; 

→  ensure adequate administrative capacity and the required infrastructure in the central and 
local tax offices to implement and enforce tax legislation and to effectively collect taxes;  

→  strengthen 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),  and  the  IT  systems  necessary  for  tax  cooperation  and 
exchange of information in the field of direct taxation.   

In the area of indirect taxation, on 16 December 2022, the Parliament adopted amendments 
to the Law on value added tax to further harmonise it with the acquis on the common VAT 
system.  On  28 February 2023,  the  Parliament  adopted  amendments  to  the  Law  on  excise 
duties notably to gradually increase the specific part of the excise duty on cigarettes.   

In  the  area  of  direct  taxation,  in  December  2022,  the  Law  on  personal  income  tax  was 
amended  to  widen  the  scope  of  taxable  income  and  to  create  a  normative  environment 
conducive  to  attracting  ‘digital  nomads’.  To  calculate  interest  on  loans,  credits  and  other 
financial instruments, implementing legislation requires the application of the ‘arm’s length’ 
principle  as  of  2023.  As  concerns  the  rules  on  transfer  prices  of  transactions,  adopted 
implementing legislation is based on recommendations of the Organization for Economic Co-
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operation and Development (OECD).  

International assessment of the Revenue and Customs Administration (RCA) 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, 
scheduled  for  September  2023.  Montenegro  adopted 
legislation  requiring  financial 
institutions to report such accounts.   

On operational capacity and computerisation, some activities were carried out to address 
the  issues  highlighted  by  the  TADAT  analysis,  notably  to  improve  the  programme  of 
inspection supervision and risk assessment for VAT refund requests. Among the issues that 
are yet to be addressed are the structuring of the tax debt and the implementation of a modern 
approach to risk management in compliance with tax regulations.  

The RCA still needs to adopt a human resources strategy and a personnel and training plan. 

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 in implementing last year’s recommendations, mainly on publishing 
quarterly  statistics  on  international  investment  position  data.  The  government  adopted  the 
2023-2025 Economic Reform Programme (ERP) in time. Core reforms of the ERP focus on 
the identified key challenges to the economy, but macrofiscal plans do not include a medium-
term fiscal consolidation strategy. The implementation of the reforms remains weak and 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 that the Ministry of Finance and Social Welfare, the Central Bank of Montenegro 
and  Monstat  cooperate,  coordinate  among  themselves  and  have  appropriate  capacity  to 
produce  government  finance  statistics  and  fiscal  notifications  in  accordance  with  the 
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  is  based  on  a  decision  that  the  authorities  made  under 
exceptional circumstances and is fully distinct from membership of the euro area. 

In  June  2023,  proposals  for  amendments  to  the  Law  on  the  Central  Bank  of  Montenegro 
(CBM),  prepared  by  the  CBM  and  aimed  at  further  alignment  of  CBM operations  with  the 
EU acquis, were adopted by the government. In a fully separate procedure, in April 2023, the 
Montenegrin  Parliament  adopted  its  own  amendment  to  the  Law,  which  assigns  to  the 
Parliament the right to appoint the CBM governor and members of the CBM Council, based 
on  a  public  competition.  The  amendment  also  shortens  the  remaining  term  of  office  of  the 
governor  and  incumbent  CBM  Council  members.  However,  the  president  of  Montenegro 
refused to sign the new version of the Law, voted by the Parliament, while the draft prepared 
by the CBM and adopted by the government is yet to be transmitted to the parliament.  

In the area of economic policy, there were no significant developments in terms of alignment 

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with  Council  Directive  2011/85/EU  on  requirements  for  budgetary  frameworks  of  the 
Member  States,  or  introduction  of  European  System  of  Accounts  (ESA  2010)  standards. 
Delays in introducing accrual accounting and producing government finance statistics based 
on  ESA  2010  standards  remain  a  key  obstacle  in  this  chapter.  Efforts  should  be  made  to 
ensure practical  cooperation  between the Ministry of Finance, Central  Bank of Montenegro 
and  Monstat,  and  development  of  appropriate  capacity  to  produce  government  finance 
statistics and fiscal notifications, in accordance with the EU acquis. 

In  February  2023,  the  Parliament  adopted  amendments  to  the  Law  on  budget  and  fiscal 
responsibility that make it possible to set up an independent Fiscal Council. A public call for 
three  members  of  the  Council  was  launched  in  April  2023.  However,  the  president  of 
Montenegro did not sign the amended law and the selection procedure remains stalled.   

The  government  adopted  and  submitted  its  2023-2025  Economic  Reform  Programme  on 
25 January 2023.  The  programme  integrates  macroeconomic,  fiscal  and  structural  reform 
plans  into  a  single  strategic  document.  Core  reforms  under  the  ERP  continue  from  the 
previous  programme  and  focus  on  the  identified  key  challenges  to  the  economy.  However, 
macro-fiscal  plans  do  not  include  a  medium-term  fiscal  consolidation  strategy.  The  limited 
implementation  of  2022  policy  guidance  jointly  agreed  with  the  EU  demonstrates  the 
importance of strengthening the government’s commitment to carrying out structural reforms.   

Chapter 19: Social policy and employment  

EU rules in the social field include minimum standards for labour law, equality, health and 
safety  at  work  and  non-discrimination.  They  also  promote  social  inclusion  and  social 
protection, and social dialogue at EU level.  

Montenegro  has  some  level  of  preparation  in  the  area  of  social  policy  and  employment. 
Some  progress  was  made  during  the  reporting  period  on  social  protection  through  a 
significant increase in the expenditure on social benefit. 

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

→  strengthen the Employment Agency to enable it to efficiently play its role as a modern 
public  employment  service  and  to  prepare  it  for  the  implementation  of  the  Youth 
Guarantee and the future use of the European Social Fund (ESF);  

→  continue efforts to reform the provision of active labour market policy measures with an 
emphasis on their labour market relevance, including work-based learning, and establish 
a  continuous  monitoring  mechanism  that  will  enable  evidence-based  active  labour 
market policy design; 

→  based  on  the  Roadmap  of  reforms  on  social  assistance  and  social  and  child  protection 
services, establish a clear timeline and financial planning for the reform of the social and 
child protection system and start implementing the reforms.  

During  the  reporting  period,  the  Ministry  of  Labour  and  Social  Welfare  faced  institutional 
and technical drawbacks, due to its previous repositioning within the government system and 
the August 2022 cyberattack. The reconstituted Ministry did not manage to adopt all relevant 
strategic documents in time.  The Chapter 19 Working Group was set up again, but after the 
constitutive meeting on 27 March 2023, it did not meet again in the reporting period. 

From 6 June 2022 until  31 March 2023, the Labour  Inspection made 5 588 inspection visits 
in the area of labour relations and employment, and found 2 132 irregularities, of which 944 
related  to  labour  relations  and  1 188  related  to  occupational  safety  and  health.  The  Labour 
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Inspection  detected  1 024  illegal  employment  cases  (concerning  516  foreigners  and  508 
Montenegrin  nationals);  on  the  inspectors’  order,  115  people  (34  foreigners  and  81 
Montenegrin nationals) entered employment, in line with the law. 

In 2022, the Labour Inspection detected 42 cases of non-formal employment of children aged 
between  15  and  18.  In  these  cases,  inspectors  imposed  fines  on  employers,  warned  them 
against  irregularities,  and  requested  documents  (medical  certificates  and  parental  approval 
certificates)  necessary  for  legal  employment.  The  Labour  Inspection  did  not  discover  any 
cases of severe forms of child labour in any economic activity. 

Concerning  health  and  safety  at  work,  in  December 2022  the  government  adopted  the 
national  strategy  for  occupational  safety  and  health  (2022-2027)  and  its  2023  action  plan. 
There was no progress in setting up the occupational safety and health fund envisaged under 
the  previous  sector  strategies  (for  2010-2014  and  for  2016-2020).  During  the  reporting 
period, inspectors carried out 1 520 inspections in the field of occupational safety and health, 
including  14 investigations of work accidents (3  fatal accidents, 10 serious accidents  and 1 
collective accident). The Labour Inspection remained understaffed, with only 11 inspectors in 
charge of occupational safety and health. 

In  December 2022  social  partners  signed  a  new  general  collective  bargaining  agreement. 
Overall,  social  dialogue  remains  weak.  The  involvement  of  the  tripartite  Social  Council  in 
relevant policymaking is low. During the reporting period, the tripartite Social Council held 
only two sessions, and its Presidency three sessions. 

In the area of employment policy, on 22 December 2022, the government adopted the 2023 
action  plan  for  employment.  Monitoring  the  implementation  of  the  action  plan  for 
employment and the national strategy for employment remains a challenge due to the lack of 
real-time and accurately disaggregated data. On 22 December 2022, the government adopted 
the  action  plan  for  the  interoperability  of  selected  information  systems  and  databases  that 
have  a  role  in  governing  Montenegro’s  labour  market.  The  plan  sets  out  measures  and 
activities required to bring about  interoperability of the Employment Agency database with 
the  tax  administration  databases.  Appropriate  exchange  is  also  required  with  social  welfare 
centres to enable high-quality monitoring of unemployed people. Several, mostly EU-funded, 
initiatives  and  activities  started  to  strengthen  the  technical  and  human  capacity  of  the 
Employment  Agency.  The  local  branches  of  the  Agency  remain  understaffed.  Multiple 
personnel  and  management  changes  and  amendments  to  the  Systematisation  Act  slowed 
down the reform process of the Employment Agency. 

The Working Group for the Youth Guarantee Programme is working  with experts from the 
International  Labour Organization and the European Training Foundation on improving the 
draft Youth Guarantee implementation plan. The share of youth aged 15-29 in total registered 
unemployment  in  May  2023  was  19.92%  (8  392  people,  of  whom  5  162  are  women), 
compared  to  23.83%  (10 132  and  13 679  respectively)  in  2021.  The  rate  of  NEETs  among 
young people in 2022 decreased to 23.2%, compared to 26.5% in 2021. 

In  2022,  the  labour  market  partially  recovered  compared  to  2021.  The  overall  activity  rate 
grew from 54.4% in Q4 2021 to 59.9% in Q4 2022. The employment rate was 51.2% in Q4 
2022,  compared  with  46.1%  in  Q4  2021.  The  unemployment  rate  was  14.5%  in  Q4  2022, 
compared with 15.4% in Q4 2021. The share of long-term unemployment in total registered 
unemployment  was  57.49%  in  2022,  a  large  drop  compared  to  2021  (65.6%  to  63.7% 
between  Q1  and  Q4  2021).  The  youth  employment  rate  grew  from  36.3%  in  Q1  2022  to 
39.9%  in  Q4  2022,  which  is  5.3%  higher  than  in  Q4  2021.  The  share  of  women  in  total 
registered unemployment at the end of December 2022 was 57.64%, a reduction compared to 

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the same period in 2021, when this share amounted to 60.16%.   

As  regards  labour  inspection,  an  appropriate  legislative  framework  involving  sufficient 
resources  and  modernised  planning  of  inspection  activities  and  addressing  issues  such  as 
gender that disproportionately impact on women, is not yet in place. A substantial turnover of 
staff  is  currently  ongoing  with  the  retirement  of  a  significant  number  of  experienced 
inspectors, increasing the need for training. No progress was made regarding legislative and 
non-legislative measures focused on work-life balance.  

Regarding  activities  related  to  preparations  for  the  European  Social  Fund  (ESF), 
Montenegro  needs  to  decide  which  institutions  will  be  the  contracting  and  management 
authorities  for  setting  up  the  sectoral  operational  programme  on  employment  and  social 
inclusion.  

The  social  protection  and  inclusion  sector  continues  to  face  human  resource  and  capacity 
limitations.  In  light  of  the  recent  changes  to  the  legal  and  strategic  framework,  taxes  and 
social benefits for children, the overall social policy and employment system needs thorough 
assessment and reforms to effectively respond to the needs of most at-risk groups and labour 
market demands. The Social Protection Law and the social protection strategy have yet to be 
adopted.  The  Ministry  of  Labour  and  Social  Welfare  issued  36  licences  to  social  and  child 
protection  services.  However,  much  more  involvement  of,  support  to  and  cooperation  with 
civil society is needed to achieve sustainable and effective results in the social sector, both in 
planning  and  monitoring  of  social  policies  and  for  implementing  them  through  social 
services, including at  the local  level.  In 2022,  Montenegro  adopted two amendments  to  the 
Child Protection Law, extending the right to child allowance to cover children up to 18 years 
old  in  an  attempt  to  address  the  very  high  rate  of  children  at  risk  of  poverty  and  social 
exclusion (45.5% of children under the age of 18 in 2021). Centres for social work continued 
to  be  understaffed  while  their  scope  of  work  increased  as  they  need  to  manage  the  new 
entitlements.  Children  from  Roma  and  Egyptian  communities  are  heavily  engaged  in  child 
begging.  The  Institute  of  Social  and  Child  Protection  lacks  resources  and  its  role  in  the 
overall  social  protection  system  should  be  clarified.  During  the  reporting  period,  the 
implementation of the integrated Social Welfare Information System (SWIS) enabled timely 
enforcement of all legislative changes. According to the MONSTAT Survey of Income and 
Living  Conditions  (data  for  December  2021),  the  national  ‘at-risk-of-poverty’  or  social 
exclusion rate (AROPE) was 38.9% (EU rate for 2021 was 21.7% of the population). 

There was no progress on deinstitutionalisation and the transition to community and family-
based  services,  especially  regarding  children.  The  deinstitutionalisation  strategy,  initially 
planned for Q4 2022, has yet to be adopted. Social welfare centres still do not have sufficient 
capacity to support the Ministry of Labour and Social Welfare in implementing the transition 
from institutional service provision to community-based care. 

In  the  area  of  non-discrimination  in  employment  and  social  policy,  the  Law  on  a  unified 
disability  determination  system  has  not  yet  been  adopted,  although  the  draft  law  and  the 
public  consultation  were  completed  in  2022.  The  Law  on  professional  rehabilitation  and 
employment of persons with disabilities, planned to be adopted in 2023 was also postponed. 
Civil society organisations are still not sufficiently included in policymaking processes. The 
number of people with disabilities included in the unemployment register at the end of 2022 
was 9 864, of whom 6 755 or 61.78% were women (10 970 in 2020). 

On  equality  between  women  and  men  in  employment  and  social  policy,  Montenegro’s 
Gender equality  index value in  2019 was  55 (out  of maximum 100 points), which is lower 
than  the  EU  average  of  67.4.  According  to  MONSTAT  the  difference  between  male  and 

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female activity rates (population aged 20-64) is even bigger (79.7% for men and 66.8% for 
women). According to the World Bank, the share of women in top management is only 15%, 
and  in  business  ownership  24%.  In  July  2022,  the  government  adopted  the  report  on  the 
implementation  of  the  2021  action  plan  for  implementing  the  strategy  for  development  of 
women's  entrepreneurship  for  2021-2024  to  respond  to  the  lower  share  of  women  in 
entrepreneurship  as  opposed  to  men.  The  authorities  and  other  institutions  set  up  several 
programmes and took active labour market measures to increase the overall employment rates 
of women and young people. However, social support services for vulnerable groups remain 
scarce and unsustainable. They are mostly  organised by civil  society organisations, without 
continuous support from the local or national level.  

Chapter 20: Enterprise and industrial policy  

industrial  policy  strengthens  competitiveness, 

EU 
facilitates  structural  change  and 
encourages  a  business-friendly  environment  that  stimulates  small  and  medium-sized 
enterprises (SMEs) 

Montenegro  is  in  between  moderate  and  a  good  level  of  preparation  in  the  area  of 
enterprise  and  industrial  policy.  In  2022,  some  progress  was  made  in  implementing 
enterprise and industrial policy. Further action by the government should ensure consistency 
of various national strategies and programmes in this area and the necessary inter-ministerial 
cooperation.  

In the coming year, Montenegro should: 

→  evaluate the results  of its  2019-2023 industrial  policy strategy and prepare and adopt  a 

new industrial policy, in cooperation with relevant stakeholders; 

→  align  with  the  EU  Late  Payments  Directive  by  adopting  amendments  to  the  Law  on 

deadlines for settlement of monetary obligations;  

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

In  the  area  of  enterprise  and  industrial  policy  principles,  in  December  2022,  the 
government adopted the national circular transition strategy for the period until 2030, with an 
action  plan  for  2023  and  2024.  The  strategy  identifies  four  priority  sectors  –  agriculture, 
forestry, construction and tourism  –  as well as horizontal focus  areas necessary for  circular 
transformation in key economic sectors. In June 2023, the government adopted a new 2023-
2026 strategy for the development of micro, small and medium enterprises.  

The  government  suspended  work  on  setting  up  the  Credit  Guarantee  Fund,  intended  to 
facilitate  access  to  credit  for  micro,  small  and  medium  enterprises.  Another  concept  to 
provide  credit  is  under  analysis.  Reforms  in  the  area  of  state-owned  enterprises  were 
downscaled by the government,  despite commitments  agreed in  the 2022 Joint Conclusions 
of  the  Economic  and  Financial  Dialogue.  Future  reform  plans  still  need  to  be  re-defined. 
Montenegro has yet to adopt the planned amendments to the Law on deadlines for settlement 
of monetary obligations, which aim to align the Law with the EU acquis on combating late 
payments.  

In the area of  enterprise and industrial policy instruments, the government implemented 
eight  financial  and  non-financial  programmes  to  develop  entrepreneurship  and  the  private 
sector  under  the  overarching  2022  programme  for  improving  the  competitiveness  of  the 
economy. A total of 353 companies received support under this EUR 4 million programme. 
In  March  2023,  the  government  adopted  the  2023  programme  for  improving  the 
competitiveness of the economy, with nine programme lines, worth EUR 3 million, targeting 

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in particular support for young entrepreneurs and women. The single online portal for SME 
support  (Single  Access  Point)  was  disabled  due  to  the  August  2022  cyber-attacks,  and  its 
update is ongoing.  

In  2022,  the  Investment  and  Development  Fund  of  Montenegro  (IDF)  provided  financing 
worth EUR 185 million to Montenegrin enterprises, and an additional EUR 66 million in the 
first 5 months of 2023. In July 2022, the IDF signed a EUR 50 million loan agreement with 
the  EIB,  a  second  tranche  of  the  previously  approved  loan  of  EUR 150 million.  This  loan 
aims to support climate-friendly and energy-efficient investment by local SMEs. 

In  April  2023,  the  government  signed  the  Association  Agreement  for  Montenegro’s 
participation  in  the  EU’s  Single  Market  Programme.  Montenegro  will  participate  in  three 
pillars of the programme (Improving the Internal Market, SMEs, and Consumers). 

In  the  area  of  sectoral  policies,  the  report  on  the  execution  of  the  2022  action  plan  for  the 
implementation  of  industrial  policy  was  adopted  in  March  2023.  Out  of  the  planned 
EUR 215.4 million, EUR 166.6 million was invested. In early 2023, the government launched 
the evaluation of the 2019-2023 industrial policy strategy.  

The government decided to finance the Innovation Fund using part of the receipts from the 
controversial  Economic  Citizenship  Programme  without  carrying  out  any  due  diligence  on 
the  origin  of  the  funds.  The  Innovation  Fund  administered  two  programme  lines  –  the 
collaborative  grants  programme  and  the  innovation  voucher  scheme  –  to  encourage 
cooperation  between  the  private  sector  and  research  institutions  in  developing  innovative 
projects  and  products.  Following  this  support,  the  private  sector  investment  in  innovation 
projects through various programme lines exceeded EUR 1 million in 2022 (see also Chapter 
25: Science and research). 

In January 2023, to ensure consistency of the industrial policy with other national strategies 
and  programmes,  a  coordination  body  was  set  up  at  management  level  in  the  Ministry  of 
Economic  Development  and  Tourism.  The  first  test  of  the  strengthened  inter-ministerial 
cooperation  would  be  the  implementation  of  a  newly  developed  programme  of  financial 
support  to  companies  that  wish  to  improve  their  energy  efficiency  using  innovative 
technologies and renewable energy, which should start in 2023.  

Chapter 25: Science and research 

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

Montenegro  has  a  good  level  of  preparation  in  this  sector.  Good  progress  was  made  on 
each  of  the  2022  recommendations,  by  continuing  the  implementation  of  the  smart 
specialisation  109109strategy  and  by  increasing  participation  in  the  Horizon  Europe 
programme.  In  2023,  the  government  budget  for  science  and  innovation  further  increased. 
Two of last year’s recommendations remain valid. 

In the coming year, Montenegro should in particular: 

→  continue to implement the smart specialisation strategy;  

→  continue  to  strengthen  academia-business  cooperation,  and  further  support  knowledge 

transfer between them, also to deliver on green deal priorities; 

→  put in place the new strategy for scientific research activities. 

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In the area of research and innovation policy, Montenegro adopted two implementing acts 
that aim to fully implement the Law on scientific research activities. These acts laid down: (i) 
the  conditions  and  more  detailed  criteria  for  awards  for  scientific  achievements  as  well  as 
award  amounts;  and  (ii)  further  conditions  for  licensing  scientific  research  institutions. 
Montenegro has yet to adopt the new strategy for scientific research activities, which will list 
instruments to increase the number of researchers. 

The  latest  available  statistics,  from  2019,  indicated  that  research  and  development  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. For 2023, the government budget for science and innovation amounted 
to EUR 4.08 million. This increased budget supports the country’s economic recovery, while 
helping to address the issue of brain drain of researchers and young people. 

Montenegro  continues  to  successfully  implement  the  smart  specialisation  strategy.  In 
June 2022, the government established a new composition of the Council for Innovation and 
Smart Specialisation, presided by the Minister of Science and Technological Development.  

In December 2022, the Council adopted the Information on the innovation programmes of the 
Innovation Fund of Montenegro for 2023, based on which the Innovation Fund prepared the 
2023 work plan, adopted by the government in April 2023. The Innovation Fund published a 
call for proposals  under its collaborative grants  programme with  a budget  of EUR 670 000. 
Seven project proposals were accepted for financing. The Innovation Fund also published a 
call for proposals under  its Innovation Vouchers  Programme  and six  additional  programme 
lines have been launched in  the period May-June 2023 (value EUR 1.65 million). The Call 
for co-financing national scientific research projects with total funds amounting to EUR 2.3 
million  was  published  in  May  2023.  Montenegro  has  yet  to  adopt  the  Programme  for 
Encouraging Innovation in the Function of Energy Efficiency in Industry. 

The cooperation with the European Innovation Council is good: the Collaborative Grants for 
Innovation scheme, managed by the Innovation Fund of Montenegro, was officially certified 
for  the  Plug-In  scheme  to  the  European  Innovation  Council  Accelerator.  The  Law  on 
incentive measures  for research and innovation  promoted the investment  of  EUR 1 934 000 
in  19  start-ups.  The  cooperation  with  the  European  Institute  of  Innovation  and  Technology 
(EIT) is also good. 

In the area of framework programmes, in Montenegro’s first two years as a member of the 
Horizon  Europe  programme,  Montenegrin  participants  gained  already  EUR 3 million 
(compared  with  EUR 4.62 million  received  over  the  seven  years  of  Horizon  2020).  The 
Ministry  of  Science  and  Technological  Development  provided  EUR 230 000  to  support  co-
financing  of  innovation  activities  under  several  strands  of  the  programme,  among  other  for 
covering participation in EUREKA. 

Chapter 26: Education and culture  

The EU supports cooperation in education and culture through funding programmes and the 
coordination  of  Member  State  policies  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 during 
the  reporting  period  although  certain  steps  were  taken  towards  achieving  more  inclusive 
education.  However,  increased  efforts  are  needed  to  progress  on  other  outstanding 
recommendations. Therefore, last year’s recommendations remain valid. 

In the coming year, Montenegro should in particular: 

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→  adopt a budgeted plan including an economic impact analysis for wide-ranging education 
reforms, also addressing inclusive education, and improve access to quality education at 
all education levels; 

→  speed  up  the  implementation  of  the  new  strategy  on  early  and  preschool  education  for 

2021-2025 to improve preschool enrolment for all children; 

→  finalise  and  adopt  the  2022-2023  national  vocational  education  and  training  (VET) 
implementation  plan  under  the  VET  strategy  for  2020-2024,  and  put  in  place  the 
mechanism to evaluate practical learning at VET and higher education levels; 

In the area of education and training, in the period July 2022 till end of 2022, Montenegro 
adopted amendments to the Law on primary education, to the general Law on education, to 
the  Law  on  higher  education,  and  to  the  Law  on  professional  training  for  persons  with 
acquired  higher  education.  On  4  April  2023,  Montenegro  adopted  the  Law  on  the 
confirmation  of  the  Agreement  on  the  Recognition  of  Qualifications  in  the  Field  of  Higher 
Education in the Western Balkans. 

In 2022 spending on education was EUR 231.8 million (4% of GDP), a slight decrease from 
2021  (4.3%).  The  pre-school  enrolment  rate  stood  at  52.99%  (male:  53.47%  and  female: 
52.46%)  in  2021/2022.  In  2022/2023  the  enrolment  rate  was  49.04%  (male:  49.74%  and 
female 48.28%). 

Montenegro  participates  in  other  international  assessments,  by  conducting  a  Trends  in 
International Mathematics and Science  Study (TIMSS), a study on progress in international 
reading  literacy  (PIRLS)  as  well  as  piloting  a  Teaching  and  Learning  International  Survey 
(TALIS).  Montenegro  is  not  participating  in  the  ICILS  (International  Computer  and 
Information Literacy Study). 

In July 2022, Montenegro adopted quality standards for the creation of digital content as part 
of  its  digital  strategy.  The  objectives  of  the  2022-2027  Montenegro  Education  System 
Digitalisation  Strategy  is  to  align  with  the  EU  Digital  Education  Action  Plan  2021-2027. 
Efforts  towards  effective,  coherent  and  inclusive  digital  transformation  of  the  Montenegrin 
education and training systems, including the capacity of the systems to develop digital skills 
remain  high  on  the  agenda.  Montenegro  has  made  use  of  EU  self-reflection  tools,  such  as 
SELFIE for schools. 

Regarding  green  education,  Montenegro’s  education  system  implements  the  education  for 
sustainable development by including, under all school subjects, the issues of climate change, 
green economy, environment protection, sustainable cities and settlements, biodiversity, and 
health education. 

As  part  of  the  early  and  preschool  education  strategy  for  2021-2025,  the  Ministry  of 
Education  continued  efforts  to  increase  the  enrolment  of  children  in  public  preschool 
institutions including through awareness-raising campaigns. For the 2022/2023  school  year, 
nearly 25 000 children (out of which nearly 12 000 girls and nearly 13 000 boys) enrolled in 
public and private preschool institutions, which is 7% more than in 2021. However, regional 
disparities remain, with low -take-up in the north. 

In  terms  of  inclusive  education,  vulnerable  children  coming  from  the  Roma  and  Egyptian 
communities now have greater possibilities for early childhood development and  education. 
In  June  2022,  26  educators  received  training  for  work  with  Roma  and  Egyptian  families, 
which  resulted  in  267  children  attending  kindergarten.  In  accordance  with  the  2021-2025 
action plan for the implementation of the strategy of social inclusion of Roma and Egyptians 
in  Montenegro,  scholarships  (worth  nearly  EUR 54 500)  were  provided  to  high-school 
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students  and students  of the Roma and Egyptian community in September-December 2022. 
The  engagement  of  Roma  and  Egyptian  mediators  in  education  continued,  as  25  mediators 
were hired in primary schools. This practice proved to be very useful for including children 
from  the Roma and Egyptian communities in the education system,  as well as for reducing 
school dropout rates.  

A programme was also set up to include children from Ukraine in the educational system of 
Montenegro. 

Furthermore, the Bureau for Textbooks and Teaching Aids prepared didactic material for 520 
students, mostly for mastering teaching material, support for literacy, mathematics, managing 
emotions  and  behaviour.  A  consultation  of  school  principals  was  held  on  topics  including 
augmentative  and  alternative  communication,  the  picture  exchange  communication  system, 
social  stories  and  Cboard,  an  application  for  children  and  adults  with  speech  and  language 
impairments, aiding communication with symbols and text-to-speech. A training session for 
about  150  representatives  from  40  schools  (IT  coordinators,  professional  service  staff,  and 
active  classroom  and/or  practical  teachers)  followed.  The  Cboard  application  is  used  in  13 
preschool institutions, in 4 primary schools, and in resource centres. In total, 81 tablets were 
allocated and are used in work with about 120 students.  

In  the  area  of  skills  and  VET,  the  Ministry  of  Education  is  committed  to  the  Osnabrueck 
Declaration  and  reforms  to  address  skills  mismatches,  including  work-based  learning  and 
curricula reforms. Montenegro its yet to draft and adopt its report on the implementation of 
the 2020-2022 action plan related to the VET strategy and the new action plan for the period 
until  the  expiration  of  the  strategy  in  2024.  Montenegro  helped  prepare  the  report  on  the 
Turin  Process  with  a  focus  on  system  performance  indicators  and  lifelong  learning.  The 
implementation of dual education continued with around 400 students placed with more than 
200  employers.  Regarding  skills  mismatches,  the  main  issues  remain  overqualification  or 
working  in  professions  for  which  people  lack  appropriate  education/skills.  The  study  on 
career  guidance  done  together  with  the  European  Training  Foundation  (ETF)  in  2022 
includes proposals for guiding students and adults to help address skills mismatches. 

Furthermore, Montenegro is still to adopt its strategy on higher education for 2023-2027 and 
a new law on higher education. 

Montenegro  benefits  from  the  international  dimension  of  the  2021-2027  Erasmus+ 
programme.    In  2022,  around  320  higher  education  staff  members  and  460  students  from 
Montenegro were selected to undertake a mobility period in EU Member States or associated 
third  countries  to  the  programme,  while  Montenegrin  higher  education  institutions  are 
expected to host around 275 staff members and 240 students from Europe. Montenegro was 
invited to take part in the European Education Area working groups 2021-2025. 

In the area of culture, Montenegro is yet to adopt a national strategy for the development of 
culture for 2023-2027. Montenegro participates in the EU Creative Europe Programme. The 
Ministry of Culture continued to raise awareness of opportunities for Montenegrins under the 
2021-2027 programme.  

The Ministry of Sports and Youth formed a working group end of August 2022 to work on 
the  amendments  to  the  Youth  Law,  to  further  specify  youth  services  and  implementation 
procedures. However, Montenegro is yet to approve the amendments to the Law and adopt its 
new youth strategy, which should replace the strategy that expired in 2020. The new strategy 
should be accompanied by a time-bound action plan on its implementation. The fact that the 
new  strategy  is  still  to  be  adopted  is  also  preventing  the  operationalisation  of  the  youth 
centres. Furthermore, intersectoral cooperation between various ministries dealing with youth 
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issues needs to improve. 

Draft  amendments  to  the  Law  on  Sports  and  the  Sports  development  Strategy  2023-2026 
were  not yet tabled. 

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,  as  well  as  adequate  implementing  and 
enforcement capacity and access to common computerised customs systems.  

Montenegro  is  moderately  prepared  for  the  customs  union.  It  made  some  progress, 
advancing  preparations  for its accession to the Convention on a common transit procedure, 
and  implementing  measures  envisaged  in  the  trade  facilitation  strategy  for  2018-2022,  thus 
partially  addressing  last  year’s  recommendations.  Staff  shortage  slowed  down  the 
implementation  of  many  IT  projects.  Challenges  related  to  the  illicit  tobacco  trade  through 
the port of Bar were partially addressed, but close monitoring and follow-up action is needed.  

In the coming year, Montenegro should in particular: 

→  implement  an  EU-compatible  computerised  transit  system  and  finalise  accession  to  the 

Convention on a common transit procedure; 

→  ensure  sufficient  staffing  levels  and  funding  to  implement  and  upgrade  customs  IT 

systems. 

In  the  area  of  customs  legislation,  in  February  2023,  Montenegro  started  implementing  a 
new  Customs  Code,  aligned  with  the  Union  Customs  Code.  The  Law  on  accession  to  the 
Convention on a common transit procedure (CTC) and the planned legislation to control the 
production of and trade in drug precursors are not yet adopted. Implementing legislation on 
the customs status of goods and the national transit procedure with a view to implementing 
the new computerised transit system (NCTS) and acceding to the CTC is already in place. 

Montenegro applies the Regional Convention on pan-Euro-Mediterranean (PEM) preferential 
rules  of  origin  and  implements  transitional  rules  of  origin  based  on  the  revised  PEM 
Convention.  

Montenegro has yet to further align legislation on customs security with the EU acquis, and 
to adopt implementing legislation on the export control of cultural goods. 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.  

Agreements  between  the  European  Commission  and  Montenegro  on  participation  in  the 
Customs and Fiscalis programmes were concluded in November 2022. 

In  the  area  of  administrative  and  operational  capacity,  the  Revenue  and  Customs 
Administration  (RCA)  hired  several  new  employees  in  the  area  of  customs.  However,  staff 
shortages, in particular of IT specialists, remain a significant concern.  

Work on the delayed implementation of the NCTS continued, with a pilot application of the 
system  in  progress.  The  start  of  the  national  implementation  of  the  NCTS  is  planned  for 
September 2023, with full application not expected before the second half of 2024. This also 
delays accession to the CTC until the second half of 2024. Several projects funded by the EU 
and  its  Member  States  are  under  way  to  upgrade  various  customs  IT  systems  or  build 
capacity in various areas of the customs service operation. The accreditation process for the 
customs laboratory is still ongoing.  

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In 2022, the gross collection of customs revenues amounted to approximately EUR 1 billion, 
over  24%  more  than  in  2021.  The  upward  trend  continued  in  2023,  with  customs  revenues 
reaching EUR 1.22 billion by the end of June, 25% more than in the first 6 months of 2022.  

Following the implementation  of the decision to  ban the storage of tobacco products  in  the 
free  zone  of  the  port  of  Bar,  the  RCA  seized  over  1.5  billion  cigarettes  worth  some 
EUR 202 million.  In February  2023, the government’s stake in  the port of Bar increased to 
78.55% after the purchase of shares from minority shareholders. The government intends to 
become the sole owner of the port of Bar and take over Port of Adria, the operator of the free 
zone  in  the  port  of  Bar.  This  could  make  it  possible  to  introduce  a  much  more  efficient 
surveillance and control of all port operations, including any shipments of tobacco products. 
To address the gaps in the current monitoring and tracing arrangements, Montenegro should 
ensure  close  monitoring  of  all  tobacco-related  operations  in  the  port,  including  by 
implementing  the  cargo  targeting  system,  which  enables  pre-arrival  risk  analysis  of 
containers in the port of Bar and electronic record keeping of containers.  

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.  
Montenegro  successfully  joined  the  Paris  Memorandum  of  Understanding  on  port  state 
control. Good progress was made on the implementation of Intelligent Transport Systems in 
road  transport.  There  was  limited  progress  on  implementing  the  Transport  Development 
Strategy  and  none  on  its  review.  There  was  very  limited  progress  concerning  environment 
and climate change.  

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 
products and couple the day-ahead energy market with neighbouring countries; strengthen the 
administrative  capacities  to  prepare  for  trans-European  networks  in  the  areas  of  transport, 
telecommunications  and  energy;  considerably  step  up  ambitions  towards  a  green  transition 
and  step  up  its  efforts  on  implementation  and  enforcement  work  to  achieve  the  closing 
benchmarks  in  Chapter  27  and  in  particular  on  waste  management  including  organising 
awareness  raising  campaigns  on  recycling  and  waste  separation  and  necessary  enforcement 
targeting citizens and local authorities, adopt the Strategy on Air quality 2021-2029, address 
water  quality  issues,  nature  protection  and  adopt  the    national  energy  and  climate  plan  to 
achieve decarbonisation by 2050 without further delays.  

Chapter 14: Transport policy  

The EU has common rules on 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  in  between  moderate  and  a  good  level  of  preparation  in  the  area  of 
transport policy. There was good progress on key reforms, notably on the implementation of 
intelligent  transport  systems  (ITS)  in  the  road  sector  and  on  accession  to  the  Paris 
Memorandum  of  Understanding  on  Port  State  Control.  Other  recommendations  from  last 

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year’s report remain valid.  

In the coming year, Montenegro should in particular: 

→  adopt a new railway law to ensure the operational independence and appropriate staffing 

of the railway regulatory body and railway safety authority;  

→  lay down the strategic ITS framework for the rail and maritime networks; 

→  urgently adopt and start implementing a new road safety strategy for 2023-2030. 

As  regards  general  transport,  alignment  of  the  national  transport  strategy  with  the 
sustainable and smart mobility strategy for the Western Balkans of the Transport Community, 
intended to  provide  a shift towards greener transport modes, is  pending.  Implementation of 
the action plans endorsed by the Transport Community continued, but progress was slow to 
moderate.  Appropriate  financing  of  the  Commission  for  Investigation  of  Accidents  in 
Maritime,  Rail  and  Air  Transport  is  yet  to  be  secured.  There  was  still  no  progress  on 
alignment  of  national  legislation  with  the  acquis  concerning  public  service  obligations, 
procedures  and  criteria  for  the  award  of  public  service  contracts  in  road,  rail  and  maritime 
transport.  For  larger  transport  agglomerations,  sustainable  urban  mobility  plans  that  respect 
environmental and social standards should be developed, following EU practice.  

In the area of road transport, in December 2022, the Parliament adopted amendments to the 
Law  on  roads,  making  it  possible  to  collect  charges  for  the  use  of  roads  and  road  land. 
Implementation  of  intelligent  transport  system  solutions  started  on  the  Bar-Boljare  road, 
including in the Sozina tunnel and on the section of the highway, opened in 2022.  

The implementation of 2020-2022 programme for road safety brought some improvements to 
the data collection and analysis, but did not yield the expected results in terms of safety, with 
no  improvement  or  reduction  of  fatal  and  serious  road  traffic  accidents.  A  new  road  safety 
strategy  for  2023-2030  is  still  at  a  draft  stage  and  should  be  adopted  as  soon  as  possible. 
Montenegro  should  also  set  up  a  dedicated  road  safety  agency.  Challenges  remain  in 
effectively enforcing the international agreements on carriage of dangerous goods by road. 

In  March  2023,  the  government  adopted  the  2023  programme  for  reconstruction  and 
maintenance  of  state  roads.  However,  no  mid-term  road  maintenance  and  rehabilitation 
programme has been prepared. 

On  rail  transport  legislation,  there  was  no  progress  on  alignment  with  the  EU  acquis. 
Montenegro is invited to align its legislation to the 4th railway package to ensure a fully open 
market for passenger and freight services. The government continued to heavily subsidise the 
state-owned company Railway Infrastructure of Montenegro to ensure regular maintenance of 
the  railway  infrastructure.  Montenegro  has  yet  to  introduce  performance-based  multiannual 
maintenance  contracts  based  on  effective  cost  control,  benchmarking  and  regulatory 
supervision.  Plans  for  sustainable  and  rationalised  railway  infrastructure  rehabilitation  and 
multiannual maintenance still need to be urgently developed. 

In the area of  maritime transport, Montenegro is yet  to  align national  legislation with  the 
EU acquis on ports and to adopt legislation based on the Port Services Regulation. Following 
a  successful  assessment  and  removal  of  the  last  legal  obstacles,  Montenegro  became  a 
member to the Paris Memorandum of Understanding on Port State Control on 1 July 2023. 
Montenegro  is  currently  implementing  the  national  maritime  single  window  and  upgrading 
the vessel traffic monitoring and information system, but progress is moderate to slow due to 
pending administrative issues. 

In  February  2023,  the  government  increased  its  ownership  in  the  port  of  Bar  to  78.55%, 
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increasing its majority in the management board. This provides additional leverage for future 
strategic  decisions,  including  a  potential  takeover  of  Port  of  Adria,  the  operator  of  the  free 
zone in the port of Bar. In February 2023, operation of the only ferry line crossing the Bay of 
Kotor  was  assigned  to  the  public  company  for  coastal  zone  management.  The  government 
terminated the contract with the private company that had previously operated this line. For 
sustainable and safe operations of ferry services it is important to ensure fair and transparent 
concession award and termination procedures. 

In  the  area  of  inland  waterway  transport  in  Montenegro,  no  progress  was  achieved  in 
aligning national legislation with relevant EU acquis.  

As  regards  aviation,  in  April  2023,  the  Parliament  ratified  amendments  to  the  European 
Common Aviation Area Agreement and its Annex I, on the rules applicable to civil aviation. 
However,  the  law  was  not  signed  by  the  president.  Certification  of  Podgorica  airport  was 
successfully  finalised  in  May  2023,  the  procedure  is  still  ongoing  for  Tivat  airport.  The 
adoption of several implementing laws during 2023 provided further alignment on common 
rules in the field of civil aviation, air safety and air traffic operations. In November 2022, the 
national  airline  company,  To  Montenegro,  received  an  Operational  Safety  Audit  certificate 
from  the  International  Air  Transport  Association.  The  company  currently  operates  four 
aircrafts and slowly develops its connection network.  

Concerning  combined  transport,  the  government  is  yet  to  start  the  implementation  of  a 
business  plan  prepared  under  the  feasibility  study  for  transforming  the  port  of  Bar  into  a 
sustainable multimodal platform. Again, there was no progress on drafting new legislation for 
combined freight transport. 

Montenegro should increase efforts to align with and implement EU passenger rights legislation.  

Chapter 15: Energy 

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

Montenegro has reached a good level of preparation in the area of energy. Some progress 
was  made,  mainly  by  creating  a  day-ahead  energy  market  and  in  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: 

→  finalise and adopt the national energy and climate plan (NECP); 

→  transpose and implement the Electricity Integration Package and 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 appoint the stockholding body 

for the mandatory oil reserves. 

In  the  area  of  security  of  supply,  Montenegro  has  an  energy  development  strategy  up  to 
2030. In July  2022, the  government  set  up  a national  council responsible for analysing and 
monitoring  the  security  of  energy  supply  and  adopted  a  decision  on  the  long-term  energy 
balance  of  Montenegro  for  2023-2025.  In  November  2022,  the  government  adopted  the 
energy balance of Montenegro for 2023.  

The Ministry of Capital Investments prepared a draft law on compulsory strategic reserves of 
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oil  and  petroleum  products.  The  draft  received  a  positive  opinion  from  the  Energy 
Community  Secretariat,  but  a  consultation  procedure  between  various  government 
departments is still ongoing. Oil stocks remain very low, and Montenegro intends to secure 
strategic  oil  reserves  by  introducing  stock-keeping  obligations  on  importers  of  petroleum 
products, in addition to the reserves to be kept and managed by Montenegro’s Hydrocarbons 
Administration.  

Work  on  the  National  Energy  and  Climate  Plan  (NECP)  was  delayed,  with  the  expected 
adoption postponed to the second quarter of 2024. The NECP will become the new strategic 
plan for the development of the energy sector until 2030, include policy and measures in the 
field of renewable energy and energy efficiency and align Montenegro’s energy policy with 
2030 Energy Community targets. 

Work  on  trans-Balkan  electricity  corridor  continued,  but  the  construction  of  the  electricity 
interconnection with Serbia did not start. The costly refurbishment of the thermal power plant 
in  Pljevlja  progressed,  despite  numerous  controversies  concerning  environmental  and  State 
aid  aspects  of  this  investment  and  Montenegro’s  international  commitments  on  greenhouse 
gas emissions (see also Chapter 27: Environment and climate change).  

Following the adoption of the Energy Support Package for the Western Balkans in November 
2023,  Montenegro  received  EUR 27 million  of  budget  support  from  the  European 
Commission  to  reduce  the  immediate  socio-economic  impact  of  the  energy  crisis  on 
vulnerable  social  groups  and  SMEs.  As  part  of  the  package,  Montenegro’s  Parliament 
adopted the national energy action plan in January 2023. The plan consists of 13 measures, 
covering a range of targets, including the preparation of a strategic framework for the NECP 
and implementation of the Commission’s recommendations on energy included in the annual 
report by January 2024. 

The adoption of the Energy Support  Package  incentivised national  authorities to  strengthen 
the 
interinstitutional  coordination  and  a  multi-stakeholders  dialogue.  Nevertheless, 
administrative capacity still needs to be strengthened.  

Concerning  the  internal  energy  market,  the  transposition  and  implementation  of  the 
Electricity Integration Package is still pending. Montenegrin Power Exchange LTD finalised 
preparatory activities to  support the legal,  operational and technical  functioning of the day-
ahead market. BELEN, the operator of the Montenegrin Power Exchange or MEPX launched 
the  day-ahead  market  on  26 April 2023  for  the  territory  of  Montenegro.  The  launch  of  the 
intraday market is still pending. A total of 63 participants are registered to participate in the 
wholesale electricity market of Montenegro.  

In the area of hydrocarbons, national legislation is aligned with the Hydrocarbons Licensing 
Directive.  The  Law  on  safety  measures  in  offshore  exploration  and  production  of 
hydrocarbons is still pending adoption by the Parliament. The exploration period granted to 
concessionaires  for  offshore  hydrocarbons  exploration  expired.  The  construction  of 
Montenegro’s  section  of  the  Ionian-Adriatic  Gas  Pipeline  (IAP)  did  not  progress.  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, in 2021, 39.3% of gross final consumption of energy came 
from  renewable  sources,  which  exceeded  the  33%  target  to  be  achieved  by  2020  under 
Montenegro’s  national  action  plan.  Five  large  renewable  energy  projects  (one  hydropower 
plant,  two  wind  energy  and  two  solar  energy  plants)  are  in  preparation  and  expected  to  be 
gradually implemented once the NECP is adopted. It remains essential that all new renewable 
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energy projects are developed in conformity with the acquis on concessions, State aid and the 
environment. 

In the area of energy efficiency, in December 2022, the Parliament adopted amendments to 
the Law on energy efficiency, resulting in an improved legal framework and better alignment 
with  EU  directives  on energy efficiency and  energy performance of buildings. Preparations 
are  ongoing  to  introduce  the  NECP  as  key  planning  document  in  the  field  of  energy 
efficiency,  instead  of  the  current  energy  efficiency  action  plan.  The  Ministry  of  Capital 
Investments  continued  coordinating  several  programmes  on  energy-efficiency  improvement 
for  private  households  as  well  as  for  public  buildings,  with  a  focus  on  the  healthcare  and 
educational sectors. Nevertheless, the certification of the energy performance of buildings is 
not yet implemented and the long-term building renovation strategy is yet to be finalised and 
adopted. 

Regarding  nuclear  energy,  nuclear  safety  and  radiation,  Montenegro  does  not  have  a 
nuclear  industry,  research  reactor  or  any  other  facility  producing  radioactive  material. 
National legislation prohibits the construction of nuclear facilities. Montenegro continues to 
participate in several regional initiatives for the early exchange of information in the event of 
a radiological emergency or hazard including the European Community Urgent Radiological 
Information Exchange. Montenegro 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. 

On nuclear safeguards, upon accession, the existing systems of accountancy and control of 
nuclear materials in Montenegro would need to be adapted to accommodate for the safeguard 
provisions (chapter 7) of the Euratom Treaty. 
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  is  in  between  moderate  and  a  good  level  of  preparation  in  trans-European 
networks.  There  was  limited  progress  in  this  area,  mostly  on  the  implementation  of  rail 
projects.  Numerous  delays  in  developing  transport  and  energy  infrastructure  demonstrate 
weaknesses in Montenegro’s project design, decision making and management capacity. Last 
year’s recommendations remain valid.  

In the coming year, Montenegro should in particular: 

→  review the  transport development  strategy  and align  it with  the strategy  for sustainable 
and  smart  mobility  in  the  Western  Balkans,  confirming  a  policy  shift  towards  rail, 
multimodality, reduction of CO2 emissions and other environmental impacts; 

→  develop  institutional  policies  to  hire  and  retain  skilled  staff  to  manage  infrastructure 

projects in the areas of transport, telecommunications and energy; 

→  revise  institutional  policies  to  improve  decision-making  on  infrastructure  projects  and 

increase the capacity to absorb funding. 

In  the  area  of  transport  networks,  Montenegro  continued  cooperating  with  the  Transport 
Community  Secretariat  and  implementing  its  six  action  plans,  but  progress  was  moderate. 
The revision of the transport development strategy to align it with the strategy for sustainable 
and smart mobility in the Western Balkans, and to provide a shift towards greener transport 
modes is pending.  

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As part of the proposed revision of the Regulation on the trans-European transport network 
(TEN-T),  the  European  Commission  and  Montenegro  conducted  bilateral  discussions  on 
adapting  the  indicative  map  of  the  transport-infrastructure  network  for  Montenegro  and 
agreed  on  two  changes,  adding  the  Montenegrin  section  of  the  rail  line  between  Podgorica 
and Capljina (Bosnia and Herzegovina) and the airport of Tivat to the comprehensive TEN-T 
network.  In  May  2023,  revised  TEN-T  maps  for  the  Western  Balkans  were  endorsed  in  a 
high-level understanding on indicative maps for TEN-T. The amended maps will become part 
of the revised TEN-T Regulation.  

In the area of transport-infrastructure development, road and rail projects and investment 
faced significant delays, which shows that the responsible administrative bodies have limited 
absorption and management capacity.  

The EU-funded feasibility study for the entire Bar-Boljare highway, including environmental 
and  social  assessments,  was  made  public  in  October  2022.  Montenegro’s  government 
confirmed its commitment to continue the highway project with the help and financing of the 
EU  partners.  In  December  2022,  the  EU  provided  financial  support  for  an  update  to  the 
feasibility  study  and  a  detailed  design  of  the  next  priority  section.  However,  work  on 
preliminary designs for the next highway sections (Matesevo-Andrijevica and the Podgorica 
bypass) was delayed and remains incomplete.  

Work was also delayed on the main design of the Scepan Polje-Pluzine road, part of TEN-T 
Route  2b,  comprehensive  network.  Montenegro  endorsed  an  agreement  with  Bosnia  and 
Herzegovina for the construction of an interstate bridge over the Tara river on the same TEN-
T route. The preliminary design work on the Budva bypass, a 30 km section of the Adriatic-
Ionian  highway,  continued  with  further  delays  until  its  completion  in  April  2023.  A  public 
consultation  on a new spatial  plan for Montenegro covers a new alignment  of the Adriatic-
Ionian highway, disregarding previously adopted studies on this route. The newly proposed 
alignment is not included in the TEN-T extension to the Western Balkans. 

As  regards  the  rail  network,  work  on  various  rail  projects  continued  with  EU  funding, 
including on upgrading the Bar-Vrbnica railway, which is part of the core network corridor. 
The government considers the rail corridor, parallel to the Bar-Boljare highway, as subsidiary 
to the highway. A change in Montenegro’s strategic thinking and planning is needed towards 
an  integrated  transport  corridor  approach  with  a  focus  on  minimising  CO2  emissions  and 
other environmental impacts.  

A multimodality study for the port of Bar was completed. The study recommends investment 
to improve bulk cargo handling and make it environmentally friendly.  

In  the  area  of  energy  networks,  work  continued  to  interconnect  the  electricity  systems  of 
Serbia, Bosnia and Herzegovina, Italy and Montenegro. There was no progress on the Ionian-
Adriatic  Gas  Pipeline  (IAP)  project.  The  progress  of  this  project  depends  on  the 
government’s  ability  to  complete  the  public  consultations  and  reach  an  agreement  with 
relevant municipalities on the preferred alignment of the pipeline.  

Overall,  infrastructure  investment  needs  to  comply  fully  with  the  EU  standards  on  public 
procurement,  State  aid  and  environmental  impact  assessment.  New  investment  needs  to 
address  changing  strategic  priorities,  decarbonisation,  digitalisation  and  resilience  of 
transport and energy networks, including prior cost-benefit analyses carried out in line with 
EU best practice.  

Montenegro  is  yet  to  fully  align  its  legislation  with  the  EU  acquis  on  the  TEN-T  and  the 
trans-European energy network. 

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Chapter 27: Environment and climate change  

The  EU  promotes  strong  climate  action,  sustainable  development  and  protection  of  the 
environment. EU rules contain provisions addressing climate change, water and air quality, 
waste  management,  nature  protection,  industrial  pollution,  chemicals,  noise  and  civil 
protection.   

Montenegro  has  some  level  of  preparation  in  this  area.  Limited  progress  was  made  in 
further  aligning  national  legislation  with  the  EU  acquis  on  water,  nature  protection  and 
climate  change.  Significant  efforts  are  still  needed  on  implementation  and  enforcement, 
particularly  on  waste  management,  water  and  air  quality,  nature  protection  and  climate 
change. Montenegro should considerably step up and accelerate its ambitions towards a green 
transition. 

In the coming year, Montenegro should in particular: 

→  intensify  implementation  and  enforcement  work  to  achieve  the  closing  benchmarks  in 
Chapter 27, in particular in the water, nature protection, air quality, industrial pollution 
and climate change sectors; 

→  adopt  and  start  implementing  the  Waste  Management  Law  and  the  national  waste 

management plan and the Strategy on air quality management for 2021-2029; 

→  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 

As  regards  horizontal  legislation,  in  June  2023,  the  government  adopted  the  fourth  semi-
annual  report  on  the  implementation  of  the  action  plan  for  fulfilment  of  the  closing 
benchmarks  in  Chapter  27.  The  report  showed  that  out  of  102  planned  activities,  only  39 
were  implemented  (38.23%).  The  highest  level  of  implementation  was  in  the  area  of  water 
quality,  industrial  pollution  and  chemicals,  the  lowest  in  the  area  of  air  quality,  noise  and 
climate  change.    In  the  reporting  period,  Montenegro  completed  1  strategic  environmental 
assessment  (SEA)  and  65  environmental  impact  assessments  (EIA).  In  the  area  of 
environmental  crime,  in  the  reporting  period,  97  new  cases  were  registered,  and  53  cases 
were  legally  resolved.  Montenegro  still  needs  to  urgently  address  the  lack  of  sufficient 
administrative  capacity  at  central  and  local  level  and  in  inspection  bodies,  the  insufficient 
interinstitutional coordination, and the lack of a sustainable financial framework. In January 
2023,  the  head  of  the  working  group  for  Chapter  27  was  finally  appointed.  Public 
participation in decision making process is taking place but requires further improvement.  

As regards air quality, there was no significant progress. The adoption of the strategy on air 
quality  management  for  2021-2029  and  the  related  action  plan  are  still  pending.    At  the 
beginning  of  winter,  an  increase  in  air  pollution  was  recorded  due  to  heating  with  wood, 
specifically in the urban part of the Pljevlja municipality. During December 2022, the value 
of  the  average  daily  concentration  of  particulate  matter  10  (PM10)  particles  exceeded  the 
limit in several municipalities particularly in Pljevlja and Podgorica.  

In the area of waste management, national legislation remains partially aligned with the EU 
acquis.  Considerable  efforts  on  strategic  planning  and  investment  are  needed  to  implement 
the national strategy for waste management until 2030. The new Law on waste management, 
was  finalised  and  is  pending  adoption  by  Parliament.  Amongst  other  issues  this  new  Law 
bans the use of lightweight plastic carrier bags with a thickness between 15 and 50 microns, 

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at  retail  establishments,  and  introduces  the  extended  producer  responsibility  program.  The 
drafting  of  the  state  waste  management  plan  for  2023-2028  is  ongoing.  Infrastructure  for 
separate waste collection and recycling exists, however it is not used properly by citizens, and 
illegal and temporary waste disposal have yet to be resolved. Media campaigns for awareness 
raising and proper enforcement rules, targeting citizens and local authorities, about separating 
waste  disposal  and  recycling,  are  needed.  The  database  on  hazardous  and  non-hazardous 
waste  treatment,  hampered  following  the  August  2022  cyber-attack,  needs  to  become 
operational.  

Alignment of national legislation with the EU acquis on water quality remains limited and 
significant  efforts  are  needed  to  step  up  the  process.  The  Ministry  of  Agriculture,  Forestry 
and  Water  Management  increased  its  administrative  capacity  in  this  area  by  hiring  new 
personnel.  On 12 January 2023, the government adopted the 2023 programme for monitoring 
surface  and  ground  water.  Montenegro  ensured  alignment  of  its  legal  framework  with  the 
Marine Strategy Directive by completing the marine environment monitoring programme and 
developing a database on the basis of the Geographic Information System. To further align its 
national  legislation  with  the  urban  waste  water  acquis,  the  waste  water  treatment  plants  in 
Andrijevica  and  Petnjica  as  well  as  the  Volujica  sewage  pumping  station  in  Bar  were 
completed.  Work is also ongoing for the urban waste water treatment plants in Podgorica and 
Pljevlja.  

In the area of nature protection, Montenegro’s national legislation remains partially aligned 
with the EU acquis. Progress in this field was limited in the reporting year. The drafting of 
amendments to the Law on nature protection is still ongoing. Work has not yet started on the 
new  national  strategy  for  biodiversity  and  the  amendments  to  the  Law  on  forests  and  the 
amendments  to  the  Law  on  wildlife  and  hunting  remain  pending.  Activities  continued 
regarding the identification of potential Natura 2000 areas. In the reporting period, a total of 
eight management plans were adopted, three for the marine protected areas: Platamuni, Stari 
Ulcinj,  and  Katič  and  five  for  the  national  parks:  Biogradska  gora,  Durmitor,  Lovćen, 
Skadarsko jezero and Prokletije. However, the management plan for the Ulcinj Salina is still 
pending.  More  active  involvement  of  the  municipality  of  Ulcinj  and  the  government  is 
essential to avoid delaying any decisions and advance towards the closing benchmark. Some 
activities  are  also  ongoing  to  implement  the  recommendations  of  the  Bern  Convention 
regarding Lake Skadar.  

No  significant  progress  was  registered  on 
industrial  pollution  control  and  risk 
management;  Montenegro’s  national  legislation  remains  partially  aligned  with  the  EU 
acquis.  In  line  with  the  Law  on  industrial  emissions,  the  Agency  for  Environmental 
Protection received three new requests for an integrated permit and finalised two requests for 
revision  of  an  integrated  permit.  One  request  for  revision  of  an  integrated  permit  and  one 
request  for  termination  of  an  integrated  permit  are  still  being  processed.  The  European 
Commission  notes  that  the  ecological  reconstruction  plan  for  the  Pljevlja  coal  power  plant 
will not address the core issues. Montenegro needs to step up its efforts to permanently close 
the plant to meet EU emission standards. Montenegro needs to plan for a just transition in the 
region, by providing economic alternatives to the communities that will be affected the most 
by the coal phase-out.  

On chemicals, Montenegro’s legislation remains partially aligned with the EU acquis. In July 
2022, the government adopted the report on the implementation of the 2021 action plan for 
the implementation of the national chemicals management strategy for 2019-2022. The 2024-
2026 national chemicals management strategy was adopted in August 2023 and focus should 
now  be  directed  towards  its  implementation  to  ensure  enforcement  of  legislation  and 

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measures to reduce the risks of hazardous chemicals for better protection of human health and 
the environment. Over the reporting period, the government adopted a number of secondary 
legislative  acts  to  implement  the  Law  on  chemicals.  Amendments  to  the  Law  on  biocidal 
products are finalised and pending adoption by Parliament.   

In  the  field  of  noise,  the  Ministry  of  Ecology,  Spatial  Planning  and  Urbanism  (MESPU)  is 
finalising the amendments to the Law on protection from noise in the environment with the 
aim  of  increasing  inspection  supervision  in  the  field  of  environment  noise  protection.  No 
measures were taken to raise public awareness on environmental noise protection.    

As  regards  civil  protection,  Montenegro  has  been  a  member  of  the  Union  Civil  Protection 
Mechanism  (UCPM)  since  April  2015.  In  November  2022,  the  government  adopted  the 
national  plan  for  rescue  and  protection  from  radiation  and  nuclear  accidents.  In  December 
2022,  the  Parliament  adopted  amendments  to  the  Law  on  rescue  and  protection  as  well  as 
related  secondary  legislation.  The  necessary  communication  equipment,  the  Secure  Trans 
European  Services  for  Telematics  between  Administrations  (sTESTA),  is  installed  in  the 
Police  Directorate,  thus  fulfilling  the  pre-requisite  to  connect  to  the  Common  Emergency 
Communication and Information System (CECIS). As a member of the UCPM Montenegro 
needs  to  swiftly  proceed  with  establishing  connection  to  the  CECIS.  Montenegro  has 
provided  assistance  under  the  UCPM  to  Türkiye  in  response  to  the  earthquake  in  February 
2023.  

Climate change 

In  the  area  of  climate  change,  the  level  of  alignment  of  Montenegro’s  national  legislation 
with the EU acquis remains limited. Montenegro has a climate-change strategy in place but 
must intensify its work to ensure consistency with the EU’s 2030 climate and energy policy 
framework.  Montenegro  needs  to  strengthen  its  administrative  capacity  to  enable  the 
implementation  and  enforcement  of  the  EU  acquis.  Considerable  work  is  still  required  to 
align national legislation with the EU acquis, such as incorporating the remaining aspects of 
the EU Emissions Trading System (ETS), the Effort Sharing Regulation and the Governance 
Regulation.  In  February  2023,  the  National  Council  for  Sustainable  Development  set  up  a 
permanent  working  group  for  mitigation  and  adaptation  to  climate  change.  The  aim  of  the 
working group is to set up a monitoring and reporting system for greenhouse gas emissions 
and  to  prepare  policies  and  measures  for  adaptation  and  mitigation  to  climate  change  in 
accordance  with  the  EU  acquis.  Concerning  the implementation  of  the  Decree  on  activities 
that  emit  gases  that  cause  the  greenhouse  effect,  a  public  auction  for  the  allocation  of 
emission  credits  was  organised  for  the  first  time  in  February  2023.  The  proceeds  –  worth 
EUR 9.2 million  –  will  encourage  the  construction  of  renewable  energy  sources,  protecting 
and  improving  the  environment,  and  encouraging  innovation.  The  MESPU  promoted  the 
purchase of cars with low fuel consumption and CO2 emissions by issuing a guide in 2022. 
Together with the United Nations Development Programme, the MESPU is also preparing a 
national  climate-change  adaptation  plan.  The  national  energy  and  climate  plan  to  achieve 
decarbonisation by 2050 is not yet in place and is delayed for yet another year. Montenegro 
needs to take decisive steps for the establishment of a mechanism on carbon pricing, aligned 
with the EU ETS to advance the implementation of the EU acquis and adequately prepare for 
the EU Carbon Border Adjustment Mechanism that entered into force in its transitional phase 
on 1 October 2023.  

CLUSTER 5: RESOURCES, AGRICULTURE AND COHESION 

This  cluster covers: agriculture and rural  development (Chapter 11); food safety,  veterinary 
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and  phytosanitary  policy  (Chapter  12);  fisheries  and  aquaculture  (Chapter  13);  regional 
policy and coordination  of structural  instruments (Chapter 22); and financial and budgetary 
provisions (Chapter 33). 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 II. The Strategy for agriculture and rural development 
for  2023-2028  was  also  adopted.  On  financial  and  budgetary  provisions,  progress  was 
achieved through improved coordination  and management of own resources.  In the coming 
period,  Montenegro  is  advised  to  accelerate  the  spending  of  EU  funds  under  IPARD  II  to 
avoid de-commitments and start the implementation of IPARD III programme. Furthermore, 
Montenegro  should  accelerate  legislative  alignment  in  the  area  of  agriculture  (such  as    the 
Law  on  organic  farming,  Law  on  wine  and  on    Olive  Oil),  and  fisheries  and  aquaculture 
(adopt the Law on structural measures and State aid in fisheries and aquaculture and Law on 
marine fisheries and mariculture), adopt and start implementing the new 2023-2028 fisheries 
and aquaculture strategy; and in the area of food to continue upgrading food establishments 
and further strengthen administrative capacity in particular on food safety controls; 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 EU’s common agricultural policy supports farmers and ensures Europe’s food security. 
It  helps  tackle  climate  change  and  the  sustainable  management  of  national  resources; 
maintains rural areas and landscapes across the EU; and keeps the rural economy alive by 
promoting jobs in farming, agri-food industries and associated sectors. This requires strong 
management and control systems. There are also common EU rules for marketing standards, 
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  in  implementing  the 
Instrument  for  Pre-accession  Assistance  for  Rural  Development  (IPARD  II  and  III) 
programmes,  by  organising  further  calls,  adopting  the  Sectoral  Agreement  for  IPARD  III, 
requesting  to  roll  over  entrustment  and  receiving  entrustment  for  the  ‘Farm  diversification 
and businesses development’ measure. The capacity of the IPARD Agency was strengthened. 
Progress was also registered with the adoption of the strategy for agriculture for 2023-2028. 
The  implementation  of  the  action  plan  on  EU  acquis  on  agriculture  and  rural  development 
alignment was limited.  

In the coming year, Montenegro should in particular:  

→  use to the best possible extent the remaining budget under IPARD II, open the first new 
calls  for  applications  under  IPARD  III,  work  on  completing  the  entrustment  of  the 
technical assistance, and submit new measures for entrustment;  

→  further implement  the  action plan for alignment  with  the EU  acquis  on  agriculture and 

rural development, including by setting up a decentralised branch of the paying agency; 

→  significantly  progress  with  the  roll-out  of  the  land  parcel  identification  system  (LPIS) 

across the whole territory.  

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As  regards  horizontal  issues,  the  strategy  for  agriculture  and  rural  development  for  2023-
2028 was  adopted in June 2023. Montenegro still needs to bring its support measures fully in 
line with EU acquis.  

Progress  in  setting  up  the  integrated  administration  and  control  system  (IACS)  remained 
slow. The land parcel identification system (LPIS) has yet to be rolled out across the whole 
territory.  Preparations  are  ongoing  to  secure  new  orthophotographs  to  update  the  system.  
Efforts to further develop the farm accountancy data network (FADN) need to continue. Farm 
advisory services have yet to be strengthened.   

As regards the common market organisation, Montenegro needs to step up implementation 
of the activities under the action plan on EU acquis alignment. The Law on wine needs to be 
updated in line with EU acquis. Work is under way to develop an electronic vineyard register. 
In January 2023, a Law on spirit drinks in line with the EU acquis was adopted. 

Amendments  to  the  Law  on  olive  growing  and  olive  oil,  laying  down,  clearer  rules  for  the 
production and placing on the market of olive oil as well as on control provisions are pending 
adoption by Parliament.  

The  2023  programme  for  improving  the  availability  of  food  under  the  schools  scheme  was 
adopted.  Procedures  and  conditions  for  administering  preferential  customs  quotas  for  the 
import of agricultural products were improved.  

In the area of rural development, two new calls were issued which means that Montenegro 
now has a total  of 11  IPARD  II  calls.  In March  2023, the European Commission  entrusted 
Montenegro with budget implementation tasks for the IPARD measure ‘Farm diversification 
and business development’, which enables the country to contract projects from its first call. 
The external audit assessment of the IPARD measure ‘Technical assistance’ was provided to 
complete  the  entrustment  package  that  Montenegro  sent  to  the  European  Commission  in 
February 2022. A second automatic decommitment of funds took place after the end of the 
financial year 2022, and there is significant risk of losing additional funds at the end of 2023. 
The last call under the IPARD II programme closed in June 2023. The fact that the IPARD II 
programme  is  still  running  should  not  slow  down  the  start  of  the  implementation  of  the 
IPARD  III  programme.    Authorities  are  encouraged  to  put  further  efforts  into  ensuring  full 
absorption of available funds. 

In June 2022, the European Commission approved Montenegro’s IPARD III. After adoption 
by the government, the Montenegrin Parliament confirmed the programme in December 2022 
by adopting the national Law on the management and implementation of the IPARD III. The 
instrument’s implementation can be launched once the full regulatory framework is in place.  
Montenegro  continued  to  strengthen  the  administrative  capacity  of  the  IPARD  Agency  by 
hiring  additional  staff.    Work  on  setting  up  IPARD  Agency’s  regional  offices  is  ongoing, 
albeit slowly.  

As  regards  quality  policy,  the  registration  of  products  under  the  National  Quality  Scheme 
continued. All recommendations of the 2019 EU peer-review mission require proper follow-
up, including activities to strengthen the control system. 

The organic farming sector needs support to fulfil its potential for further development and 
expansion. The Ministry of Agriculture, Forestry and Water Management is implementing a 
pilot  scheme  to  apply  for  entrustment  of  IPARD  measure  4  ‘Agri-environment-climate  and 
organic  farming’.    Work  is  still  ongoing  in  drafting  the  Law  on  organic  production,  which 
aims to further align national legislation with the EU acquis.  

Chapter 12: Food safety, veterinary and phytosanitary policy  

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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 quality of 
seeds, plant protection material, protection against harmful organisms and animal nutrition.   

Montenegro  remains  moderately  prepared  on  this  chapter.  Some  progress  was  achieved 
over  the  reporting  period,  including  the  adoption  of  the  second  update  of  Montenegro’s 
strategy for transposition and implementation of the EU acquis together with a general action 
plan  and  a  specific  action  plan  for  control  and  eradication  of  classical  swine  fever  and  the 
adoption  of  implementing  legislation  to  align  with  the  EU  acquis  in  the  food  safety, 
veterinary  and  phytosanitary  area.  There  is  a  need  to  step  up  the  strengthening  of 
administrative  capacity  and  infrastructure.  The  Commission’s  recommendations  from  last 
year remains valid.  

In the coming year, Montenegro should in particular: 

→  continue  to  implement  the  strategy  for  aligning  national  legislation  with  and 

implementing the EU acquis; 

→  further increase the share of food establishments compliant with EU standards;  

→  continue  to  strengthen  administrative  capacity  and  infrastructures  in  particular  on  food 
safety controls and implement robust disease surveillance and vaccination, as applicable. 

In the area of general food safety, the government adopted in September 2023, the second 
update  of  Montenegro’s  strategy  for  alignment  with  and  implementation  of  the  EU  acquis 
relevant for Chapter 12 including a General action plan and a Specific action plan for control 
and eradication of classical swine fever. The Administration for Food Safety, Veterinary and 
Phytosanitary Affairs (AFSVPA) implemented the 2022 programme for food and feed safety 
and  quality  measures  and  adopted  the  2023  programme.  The  AFSVPA  strengthened  its 
administrative capacity to a certain extent by recruiting one food inspector. 

As  regards  veterinary  policy  and  animal  welfare, 
the  AFSVPA  adopted  further 
implementing  legislation  to  align  national  legislation  with  the  EU  acquis.  The  AFSVPA 
implemented the 2022 programme of mandatory animal health protection measures, despite 
problems  related  to  the  August  2022  cyber-attack  and  the  subsequent  blockage  of  the 
electronic database on  animals  and the  central register of farms. The  AFSVPA adopted the 
2023 programme envisaging intensified awareness-raising campaigns, strengthening passive 
surveillance  of  priority  diseases  (avian  influenza,  bluetongue  disease,  African  swine  fever 
and rabies) and fulfilling the conditions for acquiring status for some of the diseases (bovine 
tuberculosis, brucellosis and enzootic bovine leucosis).  

The  AFSVPA  implemented  disease  surveillance  programmes.  Montenegro  successfully 
implemented  the  autumn  2022  and  spring  2023  rabies  vaccination  campaigns  with  EU 
support.    In  November  2022,  the  World  Organisation  for  Animal  Health  accepted  the  self-
declaration of Montenegro as a rabies-free country. Montenegro’s application to be added to 
the  European  Commission’s  list  of  rabies-free  countries,  which  would  enable  exemptions 
from serological tests and thus ease the conditions for non-commercial movement of pets, is 
currently  under  consideration  by  the  Commission.    There  were  no  new  cases  of  avian 
influenza during the reporting period; measures to prevent, detect and control the disease are 
in force. 

The  AFSVPA  continued  harmonising  legislation  and  improving  the  national  system  for 
residual  control  and  veterinary  medicines.  The  2022  programme  for  monitoring  residues  in 
animals and products of animal origin was implemented. Furthermore, a new programme for 

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monitoring prohibited substances in intestines was introduced as a new monitoring product. 
Montenegro’s request to be included in the list of countries for which residue monitoring has 
been approved, was approved by the European Commission in June 2023.   

The  AFSVPA  continued  to  improve  the  national  regulatory  and  control  system  for  poultry 
production and poultry products, and to harmonise it with systems in the EU. The finalisation 
of the veterinary information system was delayed because of the August 2022 cyber-attack. 
Four  calls  have  been  published  under  IPARD  II  (2014-2020),  focusing  on  education  about 
improving  existing  animal  welfare  conditions  in  housing  facilities  for  food  producing 
animals.   

As  regards  administrative  and  inspection  capacity,  the  AFSVPA  hired  two  veterinary 
inspectors. 

In the area of placing on the market of food, feed and animal by-products, the AFSVPA 
continued  implementing  the  national  programme  for  the  upgrading  of  food  establishments. 
This  resulted  in  a  high  percentage  of  establishments  fulfilling  their  obligations  under  the 
improvement plans. The number of facilities licensed to export to the EU remained the same 
at 19.  

The  outstanding  issues  regarding  the  location  of  the  facility  for  processing  animal  by-
products resulted in a delay in the implementation of activities linked to the management of 
animal by-products not intended for human consumption.  

Montenegro continued to implement its national programme for improving raw milk quality 
and  handling  non-compliant  milk.  National  milk  laboratory  staff  received  training  on  all 
laboratory  information  management  system  modules.  Their  connection  with  the  veterinary 
information system is delayed due to the August 2022 cyber-attack. In the area of food safety 
rules and specific rules for feed, the AFSVPA implemented the 2022 programme of food 
and feed safety measures and adopted the 2023 programme.  

The  2022  programme  of  phytosanitary  measures  was  implemented  along  with  the 
programme of control of production of seed and propagating material. The 2023 programme 
was  also  adopted.  The  AFSVPA  adopted  further  implementing  legislation  in  the 
phytosanitary area and timely carried out the 2021-2026 national plan for sustainable use of 
pesticides.  On  31 March 2023,  the  European  Commission  accepted  Montenegro’s  self-
declaration as a country that it is free from Xylella fastidiosa. The AFSVPA strengthened its 
administrative  capacity  by  hiring  two  phytosanitary  inspectors  and  one  consultant  in  the 
department for pesticides.  

On  genetically  modified  organisms,  the  AFSVPA  implemented  the  2022  programme  for 
genetically  modified  food  and  feed  monitoring  and  started  implementing  the  2023 
programme. 

Chapter 13: Fisheries and aquaculture  

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 control and inspection, rules on markets and 
aquaculture  and  support  for  fisheries  and  coastal  communities.  Further,  it  promotes  a 
sustainable aquaculture.   

Montenegro has some level of preparation in this area. Limited progress was made in the 
areas  of  strengthening  the  administrative  capacity,  improving  data  collection  and  good 
cooperation  within  the  General  Fisheries  Commission  for  the  Mediterranean  (GFCM) 

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framework.  Last  year’s  recommendations  remain  valid.  Montenegro  continued  to  be  a 
reliable partner in international fora. 

In the coming period, Montenegro should in particular: 

→  finalise  and  adopt  the  new  fisheries  and  aquaculture  strategy  with  the  action  plan  on 

aligning national legislation with and enforcing the EU acquis; 

→  adopt the pending legislation on market organisation, structural measures and State aid in 

fisheries and aquaculture and on governing marine fisheries and aquaculture; 

→  continue  to  strengthen  administrative,  data  collection,  scientific  advice,  inspection  and 

control capacity. 

Montenegro  is  still  preparing  the  new  2023-2028  fisheries  and  aquaculture  strategy  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 still pending adoption by the 
Parliament.  Work is ongoing on the organisation of a Technical Assistance and Information 
Exchange mission to review the draft law on marine fisheries and mariculture with a view to 
adopt the Law by end of 2023. In April 2023, the Ministry of Agriculture, Forestry and Water 
Management  (MAFWM)  adopted  secondary  legislation  on  the  technical  conditions 
applicable  to  the  place  of  first  sale  of  fish  and  fisheries  products  and  the  conditions  and 
method of sale.  

Concerning administrative capacity, the MAFWM hired one additional member of staff in 
its Directorate for Fisheries, Department for Structural Measures, Market and State Aid. The 
ecologic and social feasibility of a port construction in Ulcinj continued.  

As regards resource management, the MAFWM’s Directorate for Fisheries, in cooperation 
with the Institute of Marine Biology, implemented activities set out in the 2022 annual data 
collection programme on Montenegrin fisheries, for both commercial catches and biological 
data.  The  said  programme  continued  in  2023.  The  development  of  management  plans  for 
demersal  and  pelagic  resources,  as  well  as  certain  types  of  small  coastal  fisheries  (beach 
seines)  is  ongoing.  In  the  area  of  fleet  management,  through  the  first  grant  support  for 
investments  in  fishing  vessels,  including  fishing  equipment  and  electronic  devices,  three 
vessels were successfully acquired (MIDAS 2 project). As an outcome of the second call that 
was launched in March 2023, 9 new applications for the support were received. 

Regarding  inspections  and  control,  the  Directorate  for  Fisheries  set  up  the  electronic 
licensing system for sport and recreational fishing at sea. Montenegro is currently developing 
new  functionalities  within  the  existing  subsystems  of  the  Fisheries  Information  System 
related  to  gathering  socio-economic  data  in  fisheries.    Equipping  ten  landing  places  with 
devices for measuring and registering catches is underway.  Dialogue continued with Albania 
to harmonise the management of the joint European eel resources and on control of illegal, 
unreported and unregulated fishing. In February 2023, the two countries signed an agreement 
on the joint management of fisheries on Lake Skadar and in the Bojana river. The next step in 
the  process  is  the  formation  of  a  joint  committee  and  harmonisation  of  legislation  for 
managing  common  fisheries  resources.  There  were  no  developments  in  the  areas  of 
structural action, market policy and State aid. 

Montenegro  remained  a  reliable  partner  in  international  fora.  Work  on  implementing  the 
EU  Strategy  for  the  Adriatic  and  Ionian  Region  (EUSAIR)  continued,  especially  on 
implementing  the  first  pillar  of  the  EUSAIR  related  to  blue  growth,  jointly  coordinated  by 
Montenegro  and  Greece.  Montenegro  also  continued  its  cooperation  with  the  General 
Fisheries Commission for the Mediterranean (GFCM). Montenegro is encouraged to promote 
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regional cooperation with partner countries in the Adriatic-Ionian. Montenegro needs to fully 
implement  a  significant  number  of  GFCM  recommendations  particularly  on  the  Adriatic 
small  pelagics  multiannual  plan  and  the  European  eel  recommendation.  In  addition, 
Montenegro should work to reduce by-catch of sensitive species and should promote the use 
of selective gear. 

Chapter 22: Regional policy and coordination of structural instruments  

Regional  policy  is  the  EU’s  main  tool  for  reducing  regional  disparities  and  investing  in 
sustainable  and  inclusive  socio-economic  growth.  It  is  operating  through  “shared 
management”  between  the  Commission  and  EU  Member  States.  The  implementation  of 
cohesion  policy  programmes  requires  appropriate  administrative  capacity  on  programme 
and  project  level,  the  establishment  of  systems  of  sound  financial  management  and  control 
and  also  the  fulfilment  of  other  EU  acquis  elements  such  as  environmental  or  public 
procurement legislation.   

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 future 
cohesion  policy  programmes  and  on  administrative  capacity,  which  requires  strengthening. 
The 2022 recommendations remain valid. 

In the coming year, Montenegro should in particular: 

→  update  and  restart  implementation  of  the  action  plan  to  meet  requirements  under  EU 

cohesion policy; 

→  safeguard  Instrument  for  Pre-accession  Assistance  (IPA)  funds  more  effectively  by 
increasing  and  consolidating  the  administrative  capacity  of  central,  regional  and  local 
bodies and put in place a structure to manage the administration of future cohesion policy 
funds;  strengthen  capacity  in  procurement,  management  and  monitoring  of  capital 
investment, while also strengthening existing coordination mechanisms; 

→  work  on  a  credible  pipeline  of  projects,  along  with  a  framework  for  strategic  sectoral 
orientations  and  policies,  while  improving  project  preparation,  procurement  and 
implementation in line with EU and international standards. 

Regarding  the  legislative  framework,  on  27  December  2022,  the  Parliament  adopted 
Amendments  to  the Public  Procurement  Law,  in  force  as  of  January  2023.  Amendments  to 
the Law on the Budget and Fiscal responsibilities were adopted on 28 February 2023 

On  the  institutional  framework,  limited  progress  was  made.  According  to  the  action  plan 
for Chapter 22, the work on the Law on European Structural and Investment Funds, which is 
to formalise and lay down the institutional framework, is ongoing while the adoption is only 
planned  for  Q3  2024.  However,  the  EU  Regulation  setting  up  IPA  III  for  2021-2027 
emphasised  the  importance  and  urgency  of  laying  down  such  framework.  The  institutional 
set-up  and  the  system  for  managing  IPA  funds  under  indirect  management  still  need  to  be 
adapted to IPA III requirements. Decisions on the appointment of institutions and bodies that 
will implement IPA III need to be urgently formalised, taking into account these institutions 
and bodies’ future role in cohesion policy. In March 2023, the government set up the working 
group for Chapter 22 again to revamp the work on fulfilling the remaining obligations under 
Chapter 22. 

In  the  area  of  administrative  capacity,  Montenegro  must  strengthen  its  resources  for 
procurement,  contract  management,  preparation  and  implementation  of  key  structural 

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reforms.  Montenegro  continued  its  staff  retention  policy  and  maintained  the  salary 
supplement for staff in the IPA structure. To build capacity and motivate staff, the hiring and 
retention  of  staff  should  be  based  on  merits  and  a  transparent  recruitment  process,  and  for 
ministries’ management boards to provide clearer strategic directions. Training programmes 
continue to be needed for further capacity development in the IPA structure. By the deadline 
of end-December 2022, Montenegro contracted only 76.41% of the 2018 IPA allocation for 
indirect management. The pace of procurement by entrusted contracting authorities remains 
suboptimal  with  only  6.31%  of  2020  IPA  funds  contracted  by  the  end  of  2022.  The 
contracting rate for the IPA II indirect management stands at 81.29% Preparatory activities to 
disburse  2021  IPA  funds  are  slow.  Coordination  between  contracting  authorities  and  line 
ministries needs strengthening. Investment in resources must be stepped up, by ensuring that 
recruitment and retention are based on quality and merits, and by providing targeted training. 
The capacity of indirect management structures still needs to be strengthened to ensure they 
are compatible for an ex post control environment. 

In  the  area  of  monitoring  and  evaluation,  regular  activities  continued  in  line  with  IPA 
procedures. On financial management, control and audit, the Audit Authority appointed its 
Auditor General in Q4 2022. 

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. 
Some  progress  was  made  in  meeting  last  year’s  recommendations,  mostly  in  aligning  the 
legal  basis  for  the  underlying  policy  areas  affecting  the  own-resources  system,  notably 
taxation, and in strengthening the coordination and management of EU own resources in the 
Ministry of Finance and other institutions.  

In the coming year, Montenegro should in particular:  

→  strengthen  the  administrative  capacity  of  the  Directorate  for  Coordination  and 
Management  of  EU  Own  Resources  and  of  all  other  institutions  involved  in  the  own-
resources  system,  notably  by  developing  organisational  and  procedural  links  between 
these institutions; 

→  fully  implement  the  improvements  to  the  IT  system  of  the  Revenue  and  Customs 

Administration enabling a full audit trail and reporting on customs duties;  

→  adopt  implementing  legislation  on  collection  of  debts  on  movable  and  immovable 
property  and    procedures  for  writing  off  uncollectible  customs  debt  and  start  their 
implementation.  

There  was  some  progress  in  the  underlying  policy  areas  indirectly  affecting  the  own-
resources system (for progress in these areas, see Chapters 16: Taxation, 18: Statistics, 29: 
Customs union, and 32: Financial control).  

On traditional own resources, the analysis of accounting rules continued, and progress was 
made  on  marking  and  identifying  income.  Simulation  exercises  were  organised  for 
accounting  and  reporting  of  observed  cases  of  fraud  and  irregularities.  Fraud  reporting  in 

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accordance  with  the  own  resources  database  (OWNRES)  requirements  was  improved  by 
preparing  several  reports  on  seized  goods.  Several  improvements  to  the  IT  system  of  the 
Revenue  and  Customs  Administration  were  introduced,  more  specifically  for  generating 
reports related to A and B accounts. These improvements included a complete audit trail from 
the determination of the claim to its payment, subsequent control, administrative procedures 
and all other steps related to  the collection of all customs duties on behalf of the European 
Commission. However, these improvements are yet to be fully implemented. Montenegro is 
preparing  implementing  legislation  on  compulsory  collection  of  debt  on  movable  and 
immovable property in line with the Law on tax administration.  Instructions for writing off 
customs debt in conformity with the new Customs Code adopted in July 2022 have yet to be 
finalised. A manual on recognition and write-off of uncollectible customs debt, interest and 
penalties is pending approval, in order to align national legislation with the EU acquis.  

As  regards  VAT-based  resources,  in  December  2022,  the  Law  on  VAT  was  amended  to 
further align the VAT system with the EU acquis, notably on energy import.  

In  the  area  of  gross  national  income-based  resources,  Montenegro’s  GDP  is  calculated 
using the European system of national and regional accounts 2010 methodology.  

infrastructure, 

the  Directorate 

regards  administrative 

As 
for  Coordination  and 
Management  of  EU  Own  Resources  in  the  Ministry  of  Finance  continued  to  improve  its 
capacity,  focusing  on  planning,  coordination,  calculation  and  administrative  conditions  of 
own resources. However, it is necessary to substantially strengthen all institutions involved in 
the  own-resources  system,  notably  by  developing  organisational  and  procedural  links 
between  these  institutions.  Implementation  of  the  government  own  resources  action  plan  is 
ongoing.  

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  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.  

Chapter 30: External relations 

The EU has a common 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. During the reporting period, limited 
progress  was  achieved,  mainly  in  the  field  of  regional  cooperation.  While  the  parliament 
voted on ratifying Common Regional Market agreements on the freedom of movement based 
on identity cards, on recognition of professional qualifications for regulated professions, and 
on  recognition  of  academic  qualifications,  the  laws  were  not  signed  by  the  president. 
Amendments  to  the  country’s  legal  and  institutional  framework  on  development  and 
humanitarian  aid  have  yet  to  be  adopted.  Montenegro  should  continue  working  on  this 
chapter in accordance with its overall action plan on external relations. The recommendations 
from last year remain valid. 

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In the coming year, Montenegro should in particular: 

→  continue  to  actively  participate  in  the  implementation  of  measures  under  the  Common 
Regional Market action plan for 2021-2024 and ensure constructive participation in the 
negotiations  on  Additional  Protocol  7  to  the  Central  European  Free  Trade  Agreement 
(CEFTA) on dispute settlement; 

→  adopt  amendments  to  the  Laws  on  international  development  cooperation  and 

international humanitarian assistance. 

As  regards  the  common  commercial  policy,  Montenegro  continued  to  coordinate  its 
positions with those of the EU, including in the World Trade Organization.  

Montenegro  continued  to  participate  actively  in  CEFTA  working  groups,  including  in  the 
negotiations on CEFTA Additional Protocol 7 on trade dispute settlement. In April 2023, the 
Parliament ratified three agreements of the Common Regional Market concerning freedom of 
movement  based  on  identity  cards,  recognition  of  professional  qualifications  for  regulated 
professions  (medical  doctors,  dentists  and  architects),  and  recognition  of  academic 
qualifications. However, the agreements were not signed by the president. 

In  May  2023,  the  government  established  the  Trade  Facilitation  Council,  which  will  be  in 
charge  of  planning  and  coordinating  reforms  of  Montenegrin  administration  in  the  field  of 
trade  and  trade  facilitation.  The  Council  will  monitor  the  implementation  of  WTO  Trade 
Facilitation  Agreement,  CEFTA  Additional  Protocol  5  and  other  bilateral  and  multilateral 
agreements.  It  will  also  manage  the  loan  agreement  with  International  Bank  for 
Reconstruction and Development for establishment of a single window in cross-border trade. 

Legislation  on  dual-use  goods  is  in  force  and  aligned  with  EU  rules.  Montenegro’s 
application  process  to  join  the  Wassenaar  Arrangement  is  ongoing.  The  application  for 
membership in the Australia Group is still in preparation.  

Montenegro  is  still  preparing  implementing  legislation  to  the  Law  on  the  Investment  and 
Development  Fund,  which  regulates  the  issuing  and  financing  of  export  credits.  The 
implementing legislation will address the issue of export credit insurance against non-market 
risks. The Investment and Development Fund did not issue any credits yet. 

Montenegro has 24 bilateral investment treaties in force, 15 of which are with EU  Member 
States. 

In December 2022, the government launched negotiations with Hungary on an agreement on 
mutual  protection  and  promotion  of  investment.  The  Montenegrin  Bilateral  Investment 
Treaty model serves as a basis for these negotiations. 

Regarding  bilateral  trade  agreements,  in  November  2022,  the  government  launched 
negotiations with Ukraine to amend the Free Trade Agreement concerning rules of origin and 
methods of administrative cooperation. In March 2023, the Parliament ratified the Agreement 
on Economic Cooperation with South Korea. 

The  negotiations  for  an  Agreement  on  Trade,  Partnership  and  Cooperation  between 
Montenegro  and  the  United  Kingdom  of  Great  Britain  and  Northern  Ireland  continued.  In 
these  negotiations,  Montenegro  should  avoid  any  violation  of  its  obligations  under  the 
Stabilisation and Association Agreement. 

In  the  area  of  development  policy  and  humanitarian  aid,  Montenegro  has  yet  to  adopt 
amendments  to  the  Law  on  international  development  cooperation  and  international 
humanitarian  assistance,  aiming  to  improve  and  update  the  country’s  legal  and  institutional 

131 

 
 
framework  in  these  areas.  A  database  on  donor  support  projects  that  would  use  the  OECD 
Development Assistance Committee methodology has yet to be developed. 

Chapter 31: Foreign, security and defence policy  

Member States must be able to conduct political dialogue under the EU 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 EU’s common foreign and security policy (CFSP), including with the 
EU  restrictive  measures  following  Russia’s  war  of  aggression  against  Ukraine  and  has 
provided assistance to Ukraine. As a member of the Human Rights Council, Montenegro has 
been actively engaged in promoting and defending international law, the UN Charter and the 
rules-based  international  order.  In  line  with  the  Declaration  of  the  EU  –  Western  Balkans 
Summit of December 2022, Montenegro needs to make further  efforts on closing space for 
foreign  interference  and  information  manipulation,  including  disinformation.  Montenegro 
continued to participate in EU crisis management missions and operations under the common 
security and defence policy (CSDP). 

In the coming year, Montenegro should, in particular: 

→  maintain its full alignment with the EU foreign, security and defence policy. 

→  improve  implementation  and  enforcement  of  restrictive  measures,  including  preventing 

attempts to use its territory for their circumvention, 

→  make further efforts to close space for foreign interference and information manipulation, 
including disinformation, and take actions towards building resilience against all forms of 
hybrid threats. 

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. In March 2023, Montenegro participated 
at ministerial level at the first Schuman Security and Defence Forum and in May 2023 in the 
working  lunch  with  members  of  the  Foreign  Affairs  Council.  The  institutional  framework 
enabling  Montenegro’s  participation  in  the  EU  CFSP  and  CSDP  is  in  place.  Ministry  of 
Foreign  Affairs  has  appropriate  structures  to  participate  in  the  CFSP  while  the  Ministry  of 
Defence deals more specifically with the common security and defence policy (CSDP). 

In the reporting period, Montenegro maintained its 100% alignment with the EU common 
foreign  and  security  policy,  including  all  EU  restrictive  measures  targeting  Russia  and 
Belarus.  This  is  a  strong  signal  of  Montenegro’s  strategic  commitment  to  the  EU  path.  In 
March  2023,  Albania,  North  Macedonia,  Kosovo  and  Montenegro  launched  the  informal 
‘Western Balkan QUAD – 100% alignment with EU CFSP’ a platform aimed at facilitating 
their full alignment with the EU’s CFSP. Montenegro provided assistance to Ukraine and to 
Ukrainians staying in Montenegro. Montenegro also aligned with the EU position in UNGA 
when  voting  on  resolutions  regarding  Russia’s  war  of  aggression  against  Ukraine  and  its 
humanitarian impact and on initiatives in the UN Human Rights Council with regard to the 
human rights situation in China or Iran. 

On  sanctions  implementation,  the  government  adopted  four  decisions  on  the  practical 
implementation of restrictive measures against Russia and established a co-ordination body to 
monitor the implementation of international measures following Russia’s aggression against 

132 

 
 
Ukraine. However, implementation and enforcement remained mixed, in part due to limited 
administrative capacity  and the need to  update Montenegro’s legal  framework. Montenegro 
needs to continue to strengthen its capacity to implement and enforce the sanctions in place, 
including  by  adopting  the  draft  Law  on  international  restrictive  measures  to  strengthen  the 
national system for the enforcement. 

Montenegro  continued  co-operation  with  international  organisations  (UN,  OSCE  and 
Council  of  Europe)  and  remained  an  active  member  of  NATO.  The  country  maintains  a 
bilateral immunity agreement with the United States, granting US citizen’s 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  relevant  EU  position  is 
therefore needed. 

Concerning conflict prevention, during the reporting period, the Ministry of Foreign Affairs 
fulfilled  all  obligations  in  accordance  with  the  OSCE  Conflict  Prevention  Centre 
Implementation Calendar in the area of arms control. In the second half of 2022, Montenegro 
held  the  chair  of  the  Sub-regional  Consultative  Commission  of  the  Agreement  on  Sub-
Regional  Arms  Control,  Annex  1-B,  Article  IV  of  the  General  Framework  Agreement  for 
Peace  in  Bosnia  and  Herzegovina.  Montenegro  continued  supporting  EU  measures  and 
documents on conflict prevention. 

Regarding non-proliferation, Montenegro remained actively engaged in the implementation 
of  the  Western  Balkans  Small  Arms  and  Light  Weapons  (SALW)  Roadmap  and 
implemented its 2019-2025 strategy and action plan for combating illegal possession, misuse 
and trafficking of SALW. 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 
is in the process of joining the Wassenaar Arrangement (WA). In relation to the accession to 
the Australian Group (AG), a formal application that will contain detailed information on the 
legislative  framework  and  export  control  policy  is  underway,  as  well  as  implementation 
measures relevant to the objectives of the AG. The Ministry of Foreign Affairs co-ordinated 
drafting  a  new  strategic  document  for  the  period  2023-2028,  for  prevention,  detection, 
suppression and protection against Chemical, Biological, Radiological and Nuclear (CBRN) 
threats  and  risks,  prevention  and  suppression  of  the  proliferation  of  weapons  of  mass 
destruction and the means for their delivery and preventing them from falling into the hands 
of non-state actors. 

In the area of security and defence, the implementation of the defence strategy and related 
action  plan  adopted  in  2019  continued.  In  March  2023,  the  government  adopted  the  final 
report  on  the  Implementation  of  the  Action  Plan  for  the  implementation  of  the  Defence 
Strategy  (2019-2022).  In  terms  of  security  measures,  Montenegro  has  continued  to 
implement  its  agreement  on  security  of  information  with  the  EU  on  procedures  regarding 
exchange of classified information] 

Montenegro  continued  contributing  to  EU  crisis  management  missions  and  operations 
under the common security and defence policy, namely to EU NAVFOR ATALANTA.  

Montenegro takes part in the European Peace Facility Balkan Medical Task Force assistance 
measure. 

Regarding hybrid threats, adoption of the strategy on countering hybrid threats and related 
action  plan  is  pending.  Active  response  of  the  government  to  enhancing  cyber  resilience 
against malicious behaviour in cyberspace continued following the August 2022 cyber-attack. 

133 

 
 
ANNEX I – RELATIONS BETWEEN THE EU AND MONTENEGRO  

Within  the  framework  of  the  accession  negotiations,  by  October  2021,  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  2023  and  the  SA  Council  in  July  2022.  The  Stabilisation  and  Association 
Parliamentary Committee met in December 2022. 

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 16 May 2023. 

Montenegro has maintained its full alignment with the EU common foreign and security 
policy  and has  continued contributing  to  EU crisis management missions  and operations 
under the common security and defence policy. 

Visa  liberalisation  for  citizens  of  Montenegro  travelling  to  the  Schengen  area  has  been  in 
force  since  December  2009.  As  part  of  the  visa  liberalisation  monitoring  mechanism,  the 
Commission has been regularly assessing the progress made by the country in implementing 
reforms  introduced  under  the  visa  roadmap.  The  Commission’s  sixth  report  under  the  Visa 
Suspension  Mechanism  adopted  in  October  2023  concluded  that  Montenegro  continues  to 
take action to address the recommendations from the previous year’s report. A readmission 
agreement between the European Union and Montenegro has been in force since 2008. 

The  Instrument  for  Pre-accession  Assistance  2021-2027 (IPA  III)5  continues  financial 
support  to  the  region  and  finances  the  Economic  and  Investment  Plan    for  the  Western 
Balkans. The 2022 annual programme was adopted in December 2022 with an envelope of 
EUR 36.72 million, and three actions focusing on supporting Montenegro in its improvement 
of border management, reforming its public administration, and supporting further alignment 
with the EU acquis.  

At the EU-WB Summit in Tirana in December 2022, the Commission put forward an Energy 
Support  Package  of  EUR 1  billion  for  the  Western  Balkans  to  address  immediate,  short-
term, and medium-term needs in the region in the context of the energy crisis and of Russian 
war of aggression against Ukraine. Following this announcement, a EUR 30 million budget 
support  programme  for  Montenegro  was  adopted  at  the  end  of  2022  to  cushion  the  energy 
price increase to SMEs and vulnerable households and to accelerate energy diversification.   

The  bilateral  annual  programmes  are  complemented  by  a  package  of  multi-country  and 
regional  programmes,  supporting  the  environmental  sector,  dealing  with  migration,  social 
housing,  as  well  as  TAIEX  and  competitiveness  programmes  together  with  IFIs  and  IOs. 
Montenegro  is  also  benefitting  from  the  rural  development  programme  IPARD  III  (a 

5 Official Journal L 330, 20.9.2021 

134 

 
 
 
 
continuation  of  the  IPARD  II  support),  providing  a  significant  contribution  to  the 
implementation of the Economic and Investment Plan for the Western Balkans and the Green 
Agenda.  Montenegro  continues  to  participate  actively  also  in  cross-border  cooperation 
programmes  with  neighbouring  countries  and  EU  Member  States  (Adriatic  and  Danube  – 
macro  regional  strategies),  as  well  as  transnational  cooperation  programmes  and  Union 
Programmes.  

The new activities are built on and add to the closed and the few on-going programmes under 
IPA II (2014-2020), which are providing significant support through EU integration facility, 
Union  Programmes,  the  Civil  Society  Facility,  as  well  as  IPARD,  aiming  at  the  social  and 
economic development of the country and improving the reform process of the Rule of Law 
sector, Fundamental Rights, Public Administration Reform, and other critical sectors.  

The EU provides support via IPA and  the Foreign Policy Instrument to  strengthen Western 
Balkans  partners’  resilience  to  face  hybrid  threats  including  cyber  and  foreign  information 
manipulation and interference. 

135 

 
 
 
 
 
Note 

Note 

STATISTICAL DATA (as of 31/08/2023) 
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 (%) 
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) 
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 (%) 

Note 

136 

2010 
619 s 
13 812 w 

2017 
622 s 
13 812 w 

2018 
622 s 
13 812 w 

2010 
3 125 
5 050 
10 319 
41.4 
2.7 
: 
: 

: 
: 
: 

9.2 
14.6 
5.9 
70.2 s 
103.9 
21.6 
0.1 
37.0 
62.7 
: 

2010 
112.8 
: 
: 

: 

2017 
4 299 
6 910 
13 518 
46.1 
4.7 
: 
: 

: 
: 
: 

8.4 
11.3 
6.9 
73.5 s 
93.2 
26.9 
3.3 
41.1 
64.5 
: 

2017 
93.0 
: 
7.1 w 

5.4 w 

2018 
4 663 
7 490 
14 588 
48.2 
5.1 
: 
: 

: 
: 
: 

8.2 
12.5 
7.0 
72.4 s 
91.9 
29.2 
2.7 
42.9 
66.7 
: 

2018 
113.7 
: 
11.2 w 

2019 
622 s 
: 

2019 
4 951 
7 960 
15 698 
50.1 
4.1 
: 
: 

: 
: 
: 

7.9 
11.9 
7.9 
72.2 s 
89.2 
27.3 
4.7 
43.8 
65.0 
: 

2019 
106.6 
: 
11.2 w 

2020 
622 s 
: 

2020 
4 186 
6 740 
13 436 
44.7 
-  15.3 
: 
: 

: 
: 
: 

9.1 
13.5 
7.3 
70.0 s 
103.8 
27.9 
3.3 
26.0 
61.0 
: 

2020 
105.8 
: 
8.5 w 

2021 
621 s 
: 

2021 
4 955 
8 000 
15 538 
47.8 
13.0 
: 
: 

: 
: 
: 

8.0 
12.5 
5.8 
73.8 s 
92.7 
22.1 
4.5 
42.8 
62.2 
: 

2021 
110.3 
: 
11.4 w 

4.8 w 

3.3 w 

4.7 w 

4.9 w 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
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) 

Inflation rate and house prices 
Consumer price index (CPI), change relative to the previous year (%) 
**Annual change in the deflated house price index (2015 = 100) 

Balance of payments 
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 (%) 
Net balance (inward - outward) of foreign direct investment (FDI) (million euro) 
Foreign direct investment (FDI) abroad (million euro) 
of which FDI of the reporting economy in the EU-27 countries (million euro) 
Foreign direct investment (FDI) in the reporting economy (million euro) 
of which FDI of the EU-27 countries in the reporting economy (million euro) 
**Net international investment position, relative to GDP (%) 
Year on year rate of change in gross inflow of remittances (in national currency) from migrant 
workers (%) 

Public finance 
General government deficit / surplus, relative to GDP (%) 
General government gross debt relative to GDP (%) 
Total  government revenues, as a percentage of GDP (%) 
Total government expenditure, as a percentage of GDP (%) 

Financial indicators 
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) 

1) 

Note 

Note 

Note 

2) 

Note 

: 

: 

: 

: 

: 

: 

: 
1 870 w 

: 
1 780 w 

: 
2 021 w 

: 
2 205 w 

: 
1 819 w 

: 
2 164 w 

2010 
: 
: 

2010 
: 
: 
: 
: 
: 
: 
: 
: 
552.1 w 
22.1 w 
: 
574.2 w 
: 
: 
5.0 sw 

2010 
-  3.8 w 
40.7 w 
42.1 w 
45.8 w 

2010 
142.6 sw 
389.0 w 
: 
: 
: 

2017 
2.7 d 
: 

2017 
-  692.0 
- 1 860.0 
852.0 
89.0 
229.0 
22.0 
-  14.4 
: 
484.0 s 
10.0 
-  4.6 w 
494.0 
161.4 w 
-  170.1 w 
4.7 s 

2017 
-  5.7 w 
64.2 w 
41.5 w 
46.8 w 

2017 
160.6 s 
392.2 w 
: 
: 
: 

2018 
2.6 d 
: 

2018 
-  793.0 
- 2 050.0 
935.0 
55.0 
265.0 
34.0 
-  16.4 
19.0 
323.0 s 
92.0 
78.0 
415.0 
19.0 
-  168.5 w 
4.9 s 

2018 
-  4.6 w 
70.1 ew 
42.2 w 
46.2 w 

2018 
164.7 s 
381.7 w 
: 
: 
: 

2019 
0.5 d 
: 

2019 
-  707.0 
- 2 065.0 
1 019.0 
56.0 
284.0 
49.0 
-  15.8 
26.9 
345.0 s 
67.0 
1.0 
412.0 
41.0 
-  166.3 w 
4.8 s 

2019 
-  2.0 w 
76.5 w 
43.4 w 
45.4 w 

2019 
167.4 s 
381.8 w 
: 
: 
: 

2020 
-  0.5 d 
: 

2020 
- 1 091.0 
- 1 643.0 
176.0 
66.0 
308.0 
51.0 
-  19.1 
-  31.4 
470.5 w 
-  4.5 w 
-  2.0 w 
466.0 w 
90.9 w 
-  205.9 w 
6.3 s 

2020 
-  10.7 ew 
103.1 w 
43.7 ew 
54.4 ew 

2020 
221.6 s 
852.4 w 
: 
: 
: 

2021 
2.5 d 
: 

2021 
-  457.0 
- 1 914.0 
956.0 
103.0 
401.0 
66.0 
-  16.5 
5.2 
581.6 w 
9.3 w 
-  7.8 w 
590.9 w 
172.4 w 
-  168.4 w 
6.8 s 

2021 
: 
: 
: 
: 

2021 
191.5 s 
447.0 w 
: 
: 
: 

137 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Total credit by monetary financial institutions to residents (consolidated) (million euro) 
**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) 
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) 

3) 

4) 
4) 

2 166.6 w 
: 
: 
: 
: 
9.63 w 
3.26 w 
1 w 
: 
: 

2 294.1 w 
: 
: 
: 
: 
6.81 w 
0.69 w 
1 w 
: 
: 

2 528.0 w 
: 
: 
: 
: 
6.36 w 
0.56 w 
1 w 
: 
: 

2 727.3 w 
: 
: 
: 
: 
6.01 w 
0.41 w 
1 w 
: 
: 

2 841.0 w 
: 
: 
: 
: 
5.84 w 
0.40 w 
1 w 
: 
: 

2 884.2 w 
: 
: 
: 
: 
5.66 w 
0.35 w 
1 w 
: 
: 

416.4 w 

847.1 w 

1 049.8 w 

1 366.7 w 

1 738.5 w 

1 748.8 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) 
Terms of trade (export price index / import price index * 100) (number) 
Share of exports to EU-27 countries in value of total exports (%) 
Share of imports from EU-27 countries in value of total imports (%) 

Demography 
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) 

Labour market 
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 
Agriculture, forestry and fisheries (%) 
Industry (%) 

138 

Note 

Note 

Note 

2010 
1 657 
330 
- 1 327 
99.5 sw 
55.9 s 
41.8 s 

2010 
2.9 b 

6.7 
73.6 
78.5 

2010 
65.5 w 

52.9 w 

60.7 w 
45.4 w 
36.2 w 

: 
: 

2017 
2 304 
372 
- 1 932 
103.3 sw 
33.3 s 
46.5 s 

2018 
2 554 
400 
- 2 154 
100.7 sw 
43.1 s 
47.1 s 

2019 
2 601 
416 
- 2 185 
99.1 sw 
37.0 s 
47.0 s 

2020 
2 105 
366 
- 1 739 
102.7 sw 
37.7 s 
44.2 s 

2021 
2 504 
437 
- 2 067 
108.4 sw 
31.1 s 
45.7 s 

2017 
1.5 

1.3 
73.9 
79.2 

2017 
69.3 

58.2 

65.2 
51.4 
43.7 

7.9 s 
9.5 s 

2018 
1.2 

1.7 
74.5 
79.3 

2018 
70.5 

59.8 

66.7 
52.9 
46.6 

8.0 s 
9.9 s 

2019 
1.0 

2.4 
74.0 
79.5 

2019 
71.8 

60.8 

67.5 
54.2 
50.1 

7.1 s 
9.5 s 

2020 
-  0.3 

2.8 
73.2 
78.8 

2020 
67.2 

55.2 

61.7 
48.8 
44.2 

7.5 s 
10.1 s 

2021 
-  3.4 

1.4 
70.8 
77.0 

2021 
64.7 w 

54.2 w 

59.8 w 
48.7 w 
41.1 w 

6.4 w 
10.2 w 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Construction (%) 
Services (%) 
People employed in the public sector as a share of total employment, persons aged 20–64 
(%) 
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 
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 (%) 

Note 

: 
: 
34.9 w 

5) 

7.6 s 
74.1 s 
32.6 w 

9.0 s 
72.5 s 
31.7 w 

9.9 s 
73.1 s 
29.3 w 

8.3 s 
73.5 s 
30.5 w 

6.7 w 
76.7 w 
32.7 w 

6) 7) 

48.6 w 

45.7 w 

63.9 bw 

66.5 w 

65.6 w 

63.7 w 

19.7 w 
18.9 w 
20.7 w 
45.5 w 
15.5 w 

24.9 w 

9.9 w 

2010 
463 w 
106 w 

: 
: 
6.6 w 

16.1 
15.4 
17.0 
31.7 
12.5 

21.7 

10.7 

2017 
510 w 
100 w 

37 
34.0 
5.4 

15.2 
15.3 
15.1 
29.4 
11.4 

21.0 

10.0 

2018 
511 w 
98 w 

35 
35.3 
4.6 

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 

16.6 w 
17.1 w 
15.9 w 
37.1 w 
11.0 w 

31.0 w 

11.5 w 

2021 
532 w 
99 w 

33 
29.5 
6.7 w 

Standard of living 
Number of passenger cars relative to population size (number per thousand population) 
Number of mobile phone subscriptions relative to population size (number per thousand 
population) 
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 (%) 

Note 

2010 
266.0 sw 
2 260.3 w 

2017 
310.0 
1 636.7 w 

2018 
332.0 
1 822.8 w 

2019 
350.0 
1 849.9 w 

2020 
338.0 
1 736.8 w 

2021 
358.0 
1 804.4 w 

Note 

Note 

5.5 w 
12 w 

2010 
18.1 sw 

0 zw 

2010 
: 
: 

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 
18.0 s 

z 

2020 
: 
: 

7.7 w 
30 w 

2021 
18.0 s 

z 

2021 
: 
: 

139 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Note 

8) 

Note 

Note 

: 

: 

2010 
73.6 w 
338.0 

45.7 
52.5 w 

2010 
826 
0 
426 
0 
298 s 
1 129 
4 022 

2010 
: 
221.3 
: 
: 
: 
: 
4.0 
0.0 
31.1 

: 

: 

: 

: 

: 

70.6 

72.2 

74.3 

80.3 

80.8 

2017 
62.9 w 
263.3 

50.1 
39.0 w 

2017 
624 
0 
335 
0 
420 s 
1 037 
2 483 

2017 
: 
256.4 p 
87.0 p 
25.0 p 
218.0 ps 
181.4 p 
7.9 p 
0.0 
41.2 p 

2018 
67.1 w 
259.5 

52.4 
55.7 w 

2018 
728 
0 
362 
0 
334 s 
1 074 
3 811 

2018 
: 
256.8 p 
83.3 p 
23.6 p 
216.0 ps 
181.5 p 
8.0 p 
0.0 
42.3 p 

2019 
64.7 w 
258.2 

53.6 
45.4 w 

2019 
736 
0 
396 
0 
365 s 
1 112 
3 433 

2019 
: 
257.5 p 
81.4 p 
23.0 p 
210.8 ps 
178.0 p 
7.6 p 
0.0 
40.1 p 

2020 
: 
280.3 

61.5 
41.8 w 

2020 
726 
0 
400 
0 
280 s 
1 023 
3 381 

2020 
: 
258.0 p 
77.9 p 
25.8 p 
204.4 ps 
: 
7.3 p 
0.0 
39.4 p 

2021 
: 
265.0 

60.5 
65.1 w 

2021 
749 
0 
371 
0 
340 s 
1 093 
3 777 

2021 
: 
255.6 p 
71.2 p 
24.3 p 
195.0 ps 
: 
7.1 p 
0.0 
40.9 p 

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) 
Electricity generated from renewable sources relative to gross electricity consumption (%) 
Road share of inland freight transport (based on tonne-km) (%) 

Energy 
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) 
Net imports of all energy products (thousand TOE) 
Gross inland energy consumption (thousand TOE) 
Gross electricity generation (GWh) 

Agriculture 
Agricultural production volume index of goods and services (at producer prices) (2010 = 100) 
Utilised agricultural area (thousand hectares) 
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/or the statistical authorities in Montenegro 

b = break in series 
d =  definition differs 
e = estimated value 
p = provisional 
s = Eurostat estimate 
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 

140 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
statistical methodology 

z =  not applicable and therefore equal to 0 
* = Europe 2020 indicator 
** = Macroeconomic Imbalance Procedure (MIP) indicator 

  Footnotes: 

1)  Data compiled according to NACE Rev. 1.1. 
2)  Preliminary data. The final data will be avilable by the end of March 2021 
3)  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). 
4)  Weighted average effective interest rate, outstanding amounts, annual. 
5)  Data refer to number of employees in the public sector as a share of the total number of persons employed. 
6)  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. 

7)  Break in series as previously only employees were answering this question; Since 2018 all employed persons  are giving answer to this question. 
8)  Total freight traffic (national territory and international transport). 

141 

 
 
 
 
 
142