ANALYTICAL REPORT for the Opinion on the application 1 from the Republic of Macedonia for EU membership {COM (2005) 562 final} 1 Секретаријатот за европски прашања интервенираше во текстот при што референцата “Former Yugoslav Republic of Macedonia” е заменета со уставното име “Република Македонија” The Secretariat for European Affairs intervened in the text by replacing the reference “former Yugoslav Republic of Macedonia” with the constitutional name “Republic of Macedonia” Table of Contents A. Introduction 4 a) Preface...................................................................................................................... 4 b) Relations between the EU and the Republic of Macedonia...................................... 6 B. Criteria for Membership............................................................... 11 1. Political Criteria ................................................................................................... 11 1.1. Democracy and the rule of law .............................................................................. 11 1.1.1. The Parliament....................................................................................................... 13 1.1.2. The Executive......................................................................................................... 15 1.1.3. The Judiciary.......................................................................................................... 20 1.1.4. Anti-corruption policy............................................................................................ 22 1.2. Human rights and the protection of minorities....................................................... 24 1.3. Regional issues and other obligations defined by the EU Council conclusions of 29 April 1997 ......................................................................................................... 31 1.4. General evaluation ................................................................................................. 34 2. Economic Criteria................................................................................................ 36 2.1. Economic developments ........................................................................................ 36 2.2. Assessment in terms of the Copenhagen Criteria.................................................... 40 2.3. General evaluation.................................................................................................. 50 3. Ability to Assume the Obligations of Membership ............................................ 52 3.1. Chapters of the acquis ............................................................................................ 52 Chapter 1: Free movement of goods .................................................................................... 52 Chapter 2: Freedom of movement for workers..................................................................... 56 Chapter 3: Right of establishment and freedom to provide services ................................... 57 Chapter 4: Free movement of capital .................................................................................. 59 Chapter 5: Public procurement............................................................................................ 61 Chapter 6: Company law .................................................................................................... 62 Chapter 7: Intellectual property law.................................................................................... 64 Chapter 8: Competition policy............................................................................................. 66 Chapter 9: Financial services.............................................................................................. 69 Chapter 10: Information society and media........................................................................ 71 Chapter 11: Agriculture and rural development.................................................................. 74 Chapter 12: Food safety, veterinary andphytosanitary policy ........................................... 79 Chapter 13: Fisheries.......................................................................................................... 82 Chapter 14: Transport policy............................................................................................... 83 Chapter 15: Energy............................................................................................................. 85 Chapter 16: Taxation .......................................................................................................... 87 Chapter 17: Economic and monetary policy ........................................................................ 91 Chapter 18: Statistics.......................................................................................................... 92 Chapter 19: Social policy and employment ......................................................................... 94 Chapter 20: Enterprise and industrial policy...................................................................... 97 Chapter 21: Trans-European networks.............................................................................. 102 Chapter 22: Regional policy and co-ordination of structural instruments ....................... 103 Chapter 23: Judiciary and fundamental rights................................................................... 105 Chapter 24: Justice, freedom and security......................................................................... 113 Chapter 25: Science and research .................................................................................... 118 Chapter 26: Education and culture.................................................................................... 119 Chapter 27: Environment................................................................................................... 120 Chapter 28: Consumer and health protection .................................................................... 125 Chapter 29: Customs union ............................................................................................... 127 Chapter 30: External relations.......................................................................................... 130 Chapter 31: Foreign, security and defence policy ............................................................ 132 Chapter 32: Financial control.......................................................................................... 134 Chapter 33: Financial and budgetary provisions .............................................................. 136 3.2. General evaluation ............................................................................................... 137 C. European Partnership: Global Assessment .....................................139 Annex: Statistical Data ................................................................................................... 141 A. INTRODUCTION a) Preface Application for membership The Republic of Macedonia presented its application for membership of the European Union on 22 March 2004 and the Council of Ministers decided on 17 May 2004 to implement the procedure laid down in Article 49 of the Treaty on the European Union, which states: "Any European State which respects the principles set out in Article 6(1) may apply to become a member of the Union. It shall address its application to the Council, which shall act unanimously after consulting the Commission and after receiving the assent of the European Parliament, which shall act by an absolute majority of its component members." Article 6(1) states "The Union is founded on the principles of liberty, democracy, respect for human rights and fundamental freedoms, and the rule of law, principles which are common to the Member States." That is the legal framework within which the Commission submits the Opinion and the present Analytical Report. Context of the Opinion The application from the Republic of Macedonia for membership is part of an historic process, in which the Western Balkan countries are overcoming the political crisis in their region and orienting themselves to join the area of peace, stability and prosperity created by the Union. In the "Thessaloniki Agenda for the Western Balkans", adopted by the June 2003 European Council, the EU stressed "that the pace of further movement of the Western Balkans countries towards the EU lies in their own hands and will depend on each country's performance in implementing reforms, thus respecting the criteria set by the Copenhagen European Council of 1993 and the Stabilisation and Association Process conditionality." The European Council in Copenhagen in June 1993 concluded that: "The associated countries in Central and Eastern Europe that so desire shall become members of the Union. Accession will take place as soon as a country is able to assume the obligations of membership by satisfying the economic and political conditions. 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. The Union's capacity to absorb new members, while maintaining