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# 31998Y0629(10)

**Information from the Commission - Slovenia: Accession Partnership** 
  
*Official Journal C 202 , 29/06/1998 P. 0093 - 0097*

  

SLOVENIA: ACCESSION PARTNERSHIP (98/C 202/10)

1. INTRODUCTION

In the opinion which it submitted to the Council in July 1997, in accordance with the provisions of Article O of the Treaty, the Commission recommended that negotiations for accession should be opened with Slovenia. This recommendation derives from the analysis contained in the opinion in which the Commission is of the view that Slovenia (i) presents stable institutions, guarantees the rule of law, human rights and the protection of minorities, (ii) can be regarded as a functioning market economy able to cope with the competitive pressure and market forces within the Union in the medium term, and (ii) should be capable in the medium term of applying the acquis provided it continues its efforts on its transposition and intensifies its work on its implementation.

Until the entry into force of the Europe Agreement, the Interim and Cooperation Agreements will be the basis for the European Union's relations with Slovenia. However the pre-accession strategy will be reinforced to enable assistance to be directed towards the specific needs of each applicant so as to provide support for overcoming particular problems identified in the opinion. As the Commission indicated in Agenda 2000: 'The reinforced pre-accession strategy has two main objectives. First, to bring together the different forms of support provided by the Union in a single framework, the Accession Partnerships, and to work together with the applicants, within this framework, on the basis of a clearly defined programme to prepare for membership, involving commitments by the applicants to particular priorities and to a calendar for carrying them out. Second, to familiarise the applicants with Union policies and procedures through the possibility of their participation in Community programmes.`

At its meeting in Luxembourg in December 1997 the European Council decided that the Accession Partnerships would be the key feature of the enhanced pre-accession strategy, mobilising all forms of assistance to the applicant countries within a single framework. This Accession Partnership has been decided by the Commission, after consulting Slovenia and on the basis of the principles, priorities, intermediate objectives and conditions which have been decided by the Council.

2. OBJECTIVES

The purpose of the Accession Partnership is to set out in a single framework the priority areas for further work identified in the Commission's opinion on Slovenia's application for membership of the European Union, the financial means available to help Slovenia implement these priorities and the conditions which will apply to that assistance. This Accession Partnership provides a framework for a number of policy instruments which will be used to help the candidate countries in their preparations for membership. These will include, inter alia, the National Programme for the Adoption of the Acquis to be adopted by Slovenia, the Joint Assessment of Economic Policy Priorities, the Pact against Organised Crime and the internal market road maps. Each of these instruments is different in nature and will be prepared and implemented according to specific procedures. They will not be an integral part of this Partnership but the priorities they contain will be compatible with it.

3. PRINCIPLES

The main priority areas identified for each candidate country relate to their ability to assume the obligations of meeting the Copenhagen criteria which state that membership requires:

- that the candidate country has achieved stability of institutions guaranteeing democracy, the rule of law, human rights and respect for and protection of minorities,

- the existence of a functioning market economy, as well as the capacity to cope with competitive pressure and market forces within the Union,

- the ability to take on the obligations of membership, including adherence to the aims of political, economic and monetary union.

At its meeting in Madrid, the European Council stressed the need for the candidate countries to adjust their administrative structures to ensure the harmonious operation of Community policies after accession and at Luxembourg it stressed that incorporation of the acquis into legislation is necessary, but not in itself sufficient; it is necessary to ensure that it is actually applied.

4. PRIORITIES AND INTERMEDIATE OBJECTIVES

The Commission's opinions and the Council's examination of these have highlighted the extent of the efforts which still have to be made in certain areas by the candidate countries to prepare for accession and took the view that none of these countries fully satisfies all of the Copenhagen criteria at the present time. This situation will require the definition of intermediate stages in terms of priorities, each to be accompanied by precise objectives to be set in collaboration with the countries concerned, the achievement of which will condition the degree of assistance granted and the progress of the negotiations under way with some countries and the opening of new negotiations with the others. The priorities and intermediate objectives have been divided into two groups - short and medium term. Those listed under the short term have been selected on the basis that it is realistic to expect that Slovenia can complete or take them substantially forward by the end of 1998. In view of the short time span, and taking into account the administrative capacity required to achieve them, the number of priorities selected for the short term has been limited. The priorities listed under the medium term are expected to take more than one year to complete although work may and should also begin on them during 1998.

Slovenia will be invited to draw up a National Programme for the Adoption of the Acquis (NPAA) by the end of March which should set out a timetable for achieving these priorities and intermediate objectives and, where possible and relevant, indicate the necessary staff and financial resources.

The Accession Partnership indicates that Slovenia will have to address all issues identified in the opinion. The annex provides a summary checklist of these. Incorporation of the acquis into legislation is not in itself sufficient; it will also be necessary to ensure that it is actually applied to the same standards as those which apply within the Union. In all of the areas listed below there is a need for credible and effective implementation and enforcement of the acquis.

Drawing on the analysis of the Commission's opinion and the Council's examination of this, the following short and medium-term priorities and intermediate objectives have been identified for Slovenia.

4.1. Short term (1998)

- Economic reform: establishment of medium-term economic policy priorities and joint assessment within the framework of the Interim/Cooperation Agreement; action on market-driven restructuring in the enterprise, finance and banking sectors and preparation of pension reform.

- Reinforcement of institutional and administrative capacity: in particular introduction of a civil service act, improvements in the areas of the judiciary, of land registration, phytosanitary and veterinary administration, particularly as regards facilities at the external borders, financial control and audit functions, institutional strengthening in the area of environment, beginning to set up structures needed for regional and structural policy.

- Internal market: including alignment in the areas of indirect taxation, intellectual and industrial property, adoption of VAT law and preparation for implementation in 1999, standardisation and certification (conformity assessment), technical regulations, and of company legislation and liberalisation of capital movements (in particular currency legislation), establishment of a State aid monitoring authority, a first State aid inventory and the creation of a legal framework for State aid control, progress towards adoption on an anti-trust law.

- Property law: further clarification of the situation pertaining to property legislation with particular regard to the right to purchase property for European Union citizens.

- Environment: continue transposition of framework legislation, finalising the detailed approximation programmes and implementation strategies related to individual acts. Planning and commencement of implementation of these programmes and strategies.

4.2. Medium term

- Political criteria: pursue efforts to speed up property restitution.

- Economic policy: regular review of the joint assessment of economic policy priorities, within the Europe Agreement framework, focusing on satisfying the Copenhagen criteria for membership of the Union and the acquis in the area of economic and monetary policy (coordination of economic policies, submission of convergence programmes, avoidance of excessive deficits); while Slovenia is not expected to adopt the euro immediately on accession, it is expected to pursue policies which aim to achieve real convergence in accordance with the Union's objectives of economic and social cohesion, and nominal convergence compatible with the ultimate goal of adoption of the euro.

- Reinforcement of institutional and administrative capacity: as regards public procurement (in particular transparency), supervision of the insurance and security market, the Slovene Competition Office, completion of competition law, development and implementation of agricultural and regional policies, audio-visual policies, customs administration and enforcement of the customs code; improved operation of the judicial system; training for the judiciary in Community law and its application, reinforcement of justice and home affairs institutions (ensuring sufficient and properly trained personnel, in particular police, border guards, ministries and courts), strengthening of the nuclear safety authority, reform of customs and tax administrations to ensure readiness to apply the acquis and the reinforcement of food control administration.

- Internal market: including the alignment of legislation on public procurement, financial services, State aid (in particular alignment of monitoring rules and exclusive and special rights), upgrading of standardisation and conformity assessment structures, establishment of a market surveillance system and alignment of horizontal technical legislation on industrial products, increased efforts to liberalise the capital market and to facilitate foreign investments, further alignment of consumer protection, reinforcement of the competition office and the State aid monitoring authority, efficient enforcement of competition law, promotion of enterprise development, including SMEs, alignment with the acquis in the fields of telecommunications, consumer protection and the internal energy market.

- Justice and home affairs: completion of alignment to international conventions, particularly in criminal field, fight against organised crime (in particular money laundering, drugs and trafficking in human beings) and corruption, implementation of migration policy and asylum procedures, and to align visa policy with that of the European Union and to complete alignment to international conventions, notably in view of the Schengen acquis.

- Nuclear safety: nuclear policy and investment plans to be adjusted in line with the results of the seismic risk assessment to be carried out in the surroundings of the Krsko NPP.

- Agriculture: establishment of a functioning land registry, strengthening of structural and rural development policy, including alignment with the agricultural acquis (including veterinary and phytosanitary matters, in particular external border controls), attention to environmental aspects of agriculture and biodiversity. Development of the capacity to implement and enforce the common agricultural policy, in particular the fundamental management mechanisms and administrative structures to monitor the agricultural markets and implement structural and rural development measures, adoption and implementation of the veterinary and phytosanitary requirements, upgrading of certain food-processing establishments and testing and diagnostic facilities, restructuring of the agri-food sector.

- Fisheries: development of capacity to implement and enforce the common fisheries policy.

- Transport: further efforts on alignment with acquis in particular in road transport (market access, safety rules and taxation) and rail, and to provide necessary investment for transport infrastructure, notably extension of trans-European networks.

- Employment and social affairs: development of appropriate labour market structures and joint review of employment policies as preparation for participation in European Union coordination; alignment of labour and occupational health and safety legislation and development of enforcement structures, in particular early adoption of the framework Directive on health and safety at work; enforcement of equal opportunities between women and men; further development of active, autonomous social dialogue; further development of social protection.

- Environment: including the development of monitoring and implementation control structures and capacities, continuous planning and implementation of approximation programmes related to individual legal acts. A particular emphasis should be given to the waste water sector and air pollution as well as integrated industrial pollution control and risk management. Environmental protection requirements and the need for sustainable development must be integrated into the definition and implementation of national sectoral policies.

- Regional policy and cohesion: introduce the legal, administrative and budgetary framework for a national policy to address regional disparities through an integrated approach, in order to participate in European Union structural programmes after membership.

5. MAIN INSTRUMENTS FOR COMMUNITY TECHNICAL AND FINANCIAL ASSISTANCE

5.1. Programming of financial resources

The Phare allocation for the period 1995 to 1997 has totalled ECU 72 million. Subject to the approval of the Phare budget for the remaining period, the Commission will confirm the allocations for 1998 and 1999. Financial proposals will be submitted to the Phare Management Committee as provided for in Council Regulation (EEC) No 3906/89. Joint financing by the applicant countries will be systematically required for all investment projects. The Commission will work with Slovenia, the EIB and international financing institutions, in particular the EBRD and World Bank, with a view to facilitating the co-financing of projects relating to pre-accession priorities. Financial assistance from the year 2000 onwards will comprise aid for agriculture and a structural instrument which will give priority to measures similar to the Cohesion Fund. In addition Slovenia will have access to funding from multi-country programmes directly related to the acquis.

The Phare programme is the main financial instrument of the reinforced pre-accession strategy. Phare's prime objective is to help prepare Central and East European countries for accession by focusing the assistance it provides on the adoption of the Community acquis and in particular on the priorities identified in this Accession Partnership and in the National Programme for the Adoption of the Acquis. Each year the Commission will sign a financing memorandum with Slovenia in which Slovenia will undertake to meet a number of the priorities identified in this Accession Partnership and the Commission will undertake to contribute financially to their realisation. Programming of Community financial assistance will take into account the priorities and timetable of the NPAA.

In addition, the subsequent allocation of financial assistance will be closely tied to the respect by the Slovenian Government of the commitments made in the NPAA. Certain pre-accession activities can be reinforced now (e.g. support for institution building) but others, such as the financing of major investment projects designed to meet the requirements of the acquis in areas such as environment and nuclear safety will have to be programmed over a period of five to six years.

From 1998 Phare assistance will be channelled through the following types of actions:

- Institution building (around 30 %), which involves the strengthening of democratic institutions, rule of law, public administration and all entities responsible for public services in order to establish the necessary institutional and administrative structures and train the people required to apply the acquis. Institution building support will be implemented, inter alia, through, training actions, technical assistance and twinning of institutions and administrations in Slovenia with relevant bodies in the Member States. Initially this twinning will focus on priority areas such as finance, agriculture, environment, justice and home affairs.

- Investment support (around 70 %), in order to make the necessary investments possible for the adaptation of Slovenian infrastructure to the Community acquis. This support will concentrate on: (i) structural actions, covering in particular agricultural restructuring, regional development and investment in human and intellectual capital, which could include Phare contributions to participation in the research and technological development framework programme; (ii) compliance with Community norms, in particular as regards environment, agriculture, industry, occupational safety and health, transport and telecommunications; (iii) co-financing of large scale infrastructure (1) and (iv) small and medium-sized enterprises development (2).

5.2. Role of international financial institutions

Cooperation between Slovenia and the international financial institutions will receive a new impetus and a new focus through the Accession Partnership. The grant resources made available under the Accession Partnership will serve as seed money and a catalyst for larger amounts of development finance from the IFIs. This process will be developed by the Commission in liaison with the candidate countries, the EIB and the IFIs, in particular the EBRD and the World Bank with a view to facilitating the co-financing of projects relating to pre-accession priorities.

Under a new lending mandate covering the period 1997 to 1999, the EIB can make available ECU 3 520 million in Central and Eastern Europe. The new pre-accession facility approved by the EIB's governors in early 1998 increases this amount to ECU 7 billion. EIB loans shall be used in all sectors eligible for EIB financing to facilitate the accession process.

6. CONDITIONALITY

Community assistance will be conditional on respect by Slovenia of its commitments under the Europe Agreement, further steps towards satisfying the Copenhagen criteria and progress in implementing this Accession Partnership. Failure to respect these general conditions could lead to a decision by the Council on the suspension of financial assistance on the basis of Article 4 of Council Regulation (EC) No 622/98.

7. IMPLEMENTATION OF PRE-ACCESSION ASSISTANCE

The provision of financial assistance to Slovenia will depend on the maturity of projects proposed by the Slovenian Government for inclusion in a financing memorandum. Where projects need to be tendered the Commission will only finance those projects which are ready for tendering at the stage of the signature of the financing memorandum. In addition any previous/existing commitments in the same sector must have been fully contracted or be on track. In order to ensure efficient implementation, projects to be financed must not, in principle, fall below a threshold of ECU 2 to 3 million, in particular in the case of infrastructure projects. If these principles lead to a situation where Slovenia cannot absorb its full indicative allocation, the allocation will be reduced accordingly. The difference between the indicative and final allocation will be transferred to the horizontal SME and/or the large scale infrastructure facility. No subsequent compensation of this amount will be made.

The Government of Slovenia is invited to put in place an implementation structure which ensures coherence and complementarity between all types of European Union financial assistance and national resources. A national coordinator will be responsible for ensuring a close link between the general accession process and the programming of the Community financial assistance.

The Government of Slovenia will establish (preferably in the Ministry of Finance) during 1998 a national fund for investment promotion and institution building functioning under the responsibility of a National Authorising Officer (NAO). As the central entity through which Phare and other forms of Community financial assistance will be channelled, the national fund will be responsible for the management of these funds under decentralised implementation in order to increase transparency and reduce dispersion of funds. It will have overall responsibility for management of funds including respect of provisions of the financing memorandum and be accountable to the Commission for the use of the funds. It will also ensure and supervise the flow of national and other co-financing resources as set out in the financing memorandum. The detailed functions and responsibilities of the national fund will be set out in the individual financing memoranda.

In cooperation with the Government of Slovenia, the Commission will pursue a policy of further decentralisation of the implementation of the financial assistance where certain pre-conditions are met, and to the extent permitted by the European Communities' Financial Regulation, in particular Article 105(3). This will be done with the intention to establish, within limits and in a gradual manner, a relationship between the Commission and Slovenia where responsibility is shared along the lines of the relationship existing with the Member States for implementing the Structural Funds.

In this context, the possibility of applying national procurement procedures in the tendering and contracting of Phare projects may be explored by the Commission, if so requested by the Government of Slovenia, in particular in the field of investment. The Commission's decision on this matter will be taken following, inter alia, examination of the Slovenian national procurement law for respect of and compatibility with the basic provisions of the European Community's public procurement rules and its Financial Regulation, including equal participation in tenders and the provisions of Article 118. Any decision on the use of national procurement rules will be taken by the Commission on a case-by-case basis and will be confirmed in the individual financing memoranda.

The monitoring of programme implementation shall be carried out jointly with the Commission through procedures established in the individual financing memoranda. In order to ensure effective monitoring of implementation of assistance under the Phare programme, each Phare programme will incorporate quantified physical and financial objectives which will be specified in the financing memorandum. In order to gauge their effectiveness all operations financed under the Phare programme will be subject to ex-post evaluation to appraise their impact with respect to their objectives.

8. MONITORING

The implementation of the Accession Partnership will be monitored in the framework of the Europe Agreement. This will commence in 1998 before the Commission presents its first regular report to the Council reviewing the progress made by Slovenia including implementation of the Accession Partnership.

The relevant sections of the Accession Partnership will be discussed in the appropriate subcommittee. The Association Committee will discuss overall developments, progress and problems in meeting its priorities and intermediate objectives as well as more specific issues referred to it from the subcommittees. The Association Committee will report to the Association Council on the implementation of the Accession Partnership.

The Phare Management Committee will ensure that financing decisions are compatible with the Accession Partnerships.

The Accession Partnership will be amended as necessary in accordance with Article 2 of Regulation (EC) No 622/98. The Commission will propose a review of this partnership before the end of 1999 and at regular intervals thereafter. These reviews will include consideration of the need to further specify intermediate objectives in the light of the progress made by Slovenia in meeting the objectives set out in this partnership.

(1) Concerning investment projects in general, Slovenia will be required to fulfil the principle of complementarity by means of contributing a minimum amount of 25 % to jointly financed projects.

(2) A horizontal facility for SMEs will be available to remedy the shortage of investment capital available to small enterprises.

ANNEX

Slovenia will have to address all issues identified in the opinion. The purpose of this Annex is to provide a summary checklist of these issues. These are formulated as recommendations for action. They are listed in the order in which they appear in the opinion without any ranking in terms of importance or urgency. The priority areas for action by each candidate are set out as priorities and intermediate objectives in the Accession Partnership itself.

1. Political criteria

Efforts should be made to enhance the judicial system, to intensify the fight against corruption, speed up the process of restoring property or providing adequate compensation to former owners of property expropriated by the Communist regime.

Steps must be taken to resolve the problem of stateless people living in Slovenia.

2. Economic criteria

Slovenia should ensure the continuity and reinforcement of progress in liberalisation, and privatisation, to bring about long-term convergence with the European Union. In this context, the Slovene authorities should give particular attention to: the completion of public sector reform, notably by introducing VAT on 1 January 1999, reforming the pension system, and establishing a market based regulatory and governance system for State-owned enterprises; reduction of real interest rates and labour costs, the further liberalisation of prices and, subsequently, the adjustment of inflation to European Union levels in the medium term; accelerating enterprise restructuring and modernisation of privatised and State-owned companies, in particular through accelerated liberalisation of the capital market and increased attraction of foreign investment, and improvement of corporate governance.

Continued attention is also required as regards banking system reform and the liberalisation and reinforcement of the financial system. High levels of investment will be required in such fields as the environment, energy and transport.

3. Ability to assume the obligations of membership

3.1. Internal market without frontiers

The four freedoms

General framework - in general efforts must be made to accelerate law reform in the field of public procurement, for instance as regards the utilities sector, the remedies system and the White Paper Stage II measures. In the field of intellectual and industrial property, approximation of legislation should continue especially in the field of audio-visual productions and the pharmaceutical sector. As regards company law full compatibility with the second Directive must be ensured. New legislation on accounting and auditing must be fully enforced and accountants and auditors should be properly trained. Implementation and enforcement of legislation on the protection of personal data must be strengthened.

Free movement of goods - adoption of the European Community new approach system needs to be accelerated. Independent standardisation and conformity assessment infrastructures will also have to be established, with a clear separation between regulatory, standardisation and product certification functions. European Community legislation on motor vehicles, chemicals, foodstuffs and pharmaceuticals needs to be fully aligned, and new approach legislation adopted. A market surveillance mechanism will have to be set up and harmonisation of sectoral legislation completed.

Free movement of capital - monetary restrictions adopted by the Bank of Slovenia must be removed and liberalisation of capital movements should be assured. Policies on foreign direct investment should be reviewed in order to be compatible with more liberal movements and to promote higher foreign direct investment.

Free movement of services - full free establishment in the area of banking, securities and insurance, in particular with regard to branches of foreign institutions must be introduced. Privatisation in the insurance sector should be speeded up and the sector should be opened up to European Union operators and foreign investment. Supervisory function should be strengthened.

Free movement of persons - mutual recognition of diplomas should be adjusted. From a technical point of view, further adoption of regulations will be necessary. Further efforts must be made to ensure the necessary legislative and enforcement measures as regards the coordination of social security schemes.

Competition

The 1993 Law on the Protection of Competition must be amended to make it compatible with European Community competition rules. In the field of State aid, a comprehensive inventory of all existing aid must be established and continuously updated in accordance with Community practice. A national legal framework on State aid, covering the monitoring and admissibility of State aid, must be created. A monitoring authority should be set up which has the power to review all existing aid measures for their compatibility with the Europe Agreement and to monitor all new aid on a systematic basis. Certain exclusive rights and State monopolies which are not compatible with the Community acquis must be progressively adjusted and/or abolished.

3.2. Innovation

Research and technological development

Considerable efforts remain to be undertaken to revitalise technological development in the industrial sector and to exploit the potential of national research for economic development.

Education, training and youth

Continued progress in re-orienting the education and training system towards a human resources development policy which is suitable for a small open market economy aiming at international competitiveness. Budgetary resources for education should be re-oriented in line with these new priorities. Links with research and development should be reinforced.

Telecommunications

Additional efforts in policy and regulation are needed to comply with European Union Directives and to promote competition. At the same time, the acquis now requires governments to ensure that a modern telephone service is available everywhere at an affordable price. Meeting this obligation will require significant investment in the system.

Audiovisual

The existing legislation must be amended, in particular with regard to the questions of freedom of reception, promotion of European works, advertising rules and the protection of minors.

3.3. Economic and fiscal affairs

Economic and monetary union

Monetary policy should be adjusted to be able to curb excessive speculative capital in flows without resorting to capital controls. On-going reform efforts in terms of monetary policy should be continued. The restructuring of the financial sector should be completed and Central Bank legislation should be made compatible with European Community rules.

Taxation

VAT legislation in accordance with European Union requirements should be introduced.

The excise duty system must be reformed to avoid discrimination against certain imported commodities in favour of domestically produced products and the scope and rates of duties must be approximated towards the Community legislation.

In the field of excise duties particular attention should be given to the setting up of a warehousing system for the movement of goods under duty suspension arrangements. Tax structures and the level of excise rates need to be aligned on the Community model.

Statistics

Efforts must be made in the field of official statistics, in particular with regard to financial accounts, agricultural statistics and foreign trade statistics.

3.4. Sectoral policies

Industry

To enhance competitiveness, further efforts should be made to pursue policies aimed at promoting open and competitive markets and taking on the instruments which make up European Community industrial policy, relating both to the operation of markets (product specification and market access, trade policy, State aids and competition policy) and measures related to industry's capacity to adapt to change (stable macroeconomic environment, technology, training, etc.).

Agriculture

Substantial efforts must be made to ensure the alignment of Slovenian legislation with European Union requirements. With regard to veterinary and phytosanitary requirements, special attention must be paid to implementation and enforcement of veterinary and plant health requirements and upgrading of establishments to meet European Community standards particularly with regard to the inspection and control arrangements for protecting the European Union external border. Administrative structures must be strengthened to ensure the implementation and enforcement of the policy instruments of the common agricultural policy in particular to ensure a functioning land registration. The agri-food sector must be further restructured to ensure its competitive capacity. Structural and rural development policy should be strengthened.

Fisheries

The fisheries administration must be strengthened to ensure the effective implementation of the common fisheries policy, in particular as regards the conservation and the management of resources, the implementation of a monitoring and control system, the management of the common organisation of the market in the fishery and aquaculture sector, the implementation of a structural policy in the fisheries and aquaculture sector, the keeping of a fishing vessel register, the collection of statistical data as well as the implementation of European Union fishery policy on environmental protection.

Energy

Current efforts for alignment must be maintained, in particular with regard to the adjustment of monopolies, including import and export issues, access to networks, energy pricing, State intervention in the solid fuels sector, development of energy efficiency and fuel quality standards. Special attention must be paid to emergency preparedness including the building up of mandatory oil stocks. Slovenia should adhere to and/or fully implement international nuclear agreements. Long-term solutions for nuclear waste from Krsko Plant need to be found. The independence of the safety authority should be supported.

Transport

Additional efforts must be made to ensure the necessary legislation and effective implementation in road haulage (in particular on market access and taxation) and for rail transport. Transparency of financial procedures in the rail sector must be provided. Steps must be taken to ensure the future extension of the trans-European networks. At a national level there is a need to develop specific strategies for transport infrastructure development and financing. Achieving an acceptable level of transport safety and optimal use of transport system are two areas which need attention.

Small and medium-sized enterprises

Slovene SME development policy should be improved especially regarding the coherence and the coordination of various action programmes.

3.5. Economic and social cohesion

Employment and social affairs

Legislation must be realigned with European Union requirements in such areas as health and safety, and equal opportunities. Labour law must be adapted to ensure full compliance with the acquis. Some technical adaptations in the field of social security for migrant workers are necessary. Social reform should continue and social dialogue must be developed.

Regional policy and cohesion

A regional development policy addressing regional disparities must be introduced and the administrative and budgetary structures required to manage integrated European Community structural actions after membership must be established.

3.6. Quality of life and environment

Environment

Steps must be taken to ensure the full transposition of the environmental acquis as well as substantial progress in effective compliance. The National Environmental Action Programme and environmental accession strategy must be adopted in the short term. Particular efforts must be made to achieve full European Union compatibility of the urban waste water treatment, drinking water, aspects of waste management and air pollution legislation. Investments must be increased. With reference to administrative capacity a considerable effort must be made to develop adequate implementation and enforcement structures.

Consumer protection

Consumer protection should be strengthened, notably in the case of general product safety and consumer credit. The draft 'Consumer Protection Act` should be revised to ensure it is complete and fully compatible with European Community standards on consumer protection. The development of an independent consumer movement, sustained by the public authorities, will be necessary to accompany the introduction of the acquis.

3.7. Justice and home affairs (JHA)

Some gaps need to be filled in Slovenia's legislation. Special efforts should be made to reform the judiciary and the legal system and to develop human resources in this sector to enable it to operate effectively. Further progress is needed concerning immigration. The fight against organised crime must be intensified including the fight against trafficking in drugs and human beings, arms and stolen cars. Money laundering needs to be addressed. Steps must be taken to ensure ratification of international conventions particularly in the criminal field.

3.8. External policies

Trade and international economic relations

Preparations must be made for applying, on accession, the Community's various cooperation and preferential agreements, multilateral and bilateral commercial policy commitments and its autonomous commercial defence instruments. At the same time, national legislation in the field must be repealed. The lack of export controls on dual-use goods must be addressed to ensure effective control mechanisms by the time of accession.

Development

Preparations must be made for applying, on accession, the Lomé trade regime to the ACP States and participating, together with the other Member States, in financing the European Development Fund.

Customs

Customs legislation must be aligned on that of the European Community and the organisation and duties of staff must be aligned on those of a modern customs administration. An effort must be made to develop computerised systems for full participation in the customs union and the internal market. Particular attention must be paid to preparing the customs administrations for the operation of all the customs procedures with economic impact, the system of tariff suspensions and the administration of tariff quotas and ceilings. Strategic planning has to take account of the reinforcement of border posts along the external frontier that Slovenia has with countries other than European Union Member States at the time of accession.

3.9. Financial questions

The necessary financial control and audit function mechanisms must be strengthened to ensure satisfactory implementation of Community policies.

4. Administrative capacity to apply the acquis

To ensure the effective implementation and enforcement of the acquis, major reform efforts must be made to strengthen Slovenia's administrative structures in virtually all European Union relevant sectors. Special efforts must be made to properly staff and train Ministries and public authorities which must ensure the correct application of Community acquis. The regulatory and monitoring bodies must be strengthened in such fields as competition, telecommunications, taxation, agriculture, transport, social policy, regional policy and cohesion, environment, veterinary and phytosanitary controls, food control, consumer protection, judiciary and customs and financial control.

Increased efforts must be made for the upgrading of staff qualifications on European Union-related issues and efficient public management in general. This should include the implementation of the master plan for public administration reform.

The judicial system must be strengthened in terms of resources and relevant expertise. A comprehensive upgrading of judges, in particular in European Union matters, must be carried out.

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