Select Committee on European Scrutiny Fortieth Report


FORTIETH REPORT


The European Scrutiny Committee has agreed to the following Report:—

1. REPORTS ON PROGRESS BY APPLICANT COUNTRIES

(23852)
12839/02
SEC (2002) 1400-1412
ADD 1 to 13

Towards the enlarged Union: Strategy Paper and Report of the European Commission on the progress towards accession by each of the candidate countries.


Legal base:
Document originated:9 October 2002
Deposited in Parliament: 24 October 2002
Department:Foreign and Commonwealth Office
Basis of consideration: EM of 14 October 2002
Previous Committee Report: None
Discussed in Council: 24-5 October European Council
Committee's assessment:Legally and politically important
Committee's decision:For debate in European Standing Committee B


Introduction

  1.1  On 9 October 2002 the European Commission issued its Strategy Paper on EU enlargement, together with its annual reports on the progress of each of the 13 candidate countries, assessing them against the Copenhagen criteria. Under these criteria (agreed at Copenhagen in 1993) membership of the EU requires that the candidate countries ensure:

  • stability of institutions guaranteeing democracy, the rule of law, human rights and the respect for and protection of minorities (the political criteria);

  • the existence of a functioning market economy as well as the capacity to cope with the competitive pressure and market forces within the Union (the economic criteria);

  • ability to take on the obligations of membership, including adherence to the aims of political, economic and monetary union (the acquis criterion).

  1.2  The Commission says that this year's reports not only assess progress but evaluate the extent to which each candidate will fulfil the criteria within the timescale envisaged for enlargement. The Strategy Paper summarises the country reports and examines the issues arising from them, reaching conclusions on which countries will be ready to join the EU at the beginning of 2004 and discussing the remaining action required, including completion of the negotiations.

The document

  1.3  In his Explanatory Memorandum, the Minister for Europe (Mr Peter Hain) summarises the Strategy Paper's conclusions as follows:

    "Ten candidates — Cyprus, the Czech Republic, Estonia, Hungary, Latvia, Lithuania, Malta, Poland, Slovakia, and Slovenia — will be ready for membership of the EU from the beginning of 2004. The EU should therefore conclude negotiations with the Ten by the end of this year, with the aim of signing an Accession Treaty in Spring 2003."

  1.4  The Minister summarises the progress reports on the ten countries which will be ready for EU membership and able to assume the obligations of membership in 2004 as follows:

    Cyprus

    "As in previous reports, Cyprus meets both political and economic criteria. Most Accession Partnership priorities have been met or are on track. Cyprus is preparing well for accession. EU membership following a settlement would allow benefits of accession to accrue to all Cypriots. The UK, Commission and Cyprus have discussed over the last year how Cyprus' accession to the EU would affect the British Sovereign Base Areas on Cyprus."

    Czech Republic

    "High degree of alignment with the acquis achieved and adequate administrative capacity to implement it. Preparations for the internal market are well advanced. But in some areas, e.g. JHA and agriculture, progress is required on implementation. Further efforts are needed to implement commitments made in the accession negotiations. Corruption and discrimination remain concerns, but a positive report overall."

    Estonia

    "It has achieved a high level of alignment with the acquis in most areas, and has made good progress in developing its administrative capacity. It has also implemented its negotiating commitments well. Estonia must further develop administrative capacity in a few areas, and meet its commitments, particularly in Fisheries and Environment."

    Hungary

    "Good progress all round. Economic performance improved. Continued progress in aligning with acquis and ability to implement it. Further efforts needed in agriculture, transport, regional policy, environment and financial control and to establish necessary administrative capacity to ensure sound management of EC funds. Progress in tackling corruption and discrimination, but further work needed."

    Latvia

    "It has achieved a high level of alignment with the acquis in many areas, and has made progress in developing administrative capacity. Latvia is generally meeting its negotiating commitments. Developing administrative capacity remains Latvia's greatest challenge, along with tackling organised crime and corruption, and judicial reform."

    Lithuania

    "It has achieved a generally good level of alignment with the acquis, and has made progress in developing its administrative capacity, although progress in both remains patchy. Lithuania is generally meeting its negotiating commitments, but there have been delays in some areas. Lithuania needs to continue to develop its administrative capacity to ensure that all institutions are fully operational."

    Malta

    "Malta has pulled in line with the acquis in most areas, but there are still some gaps, notably in social policy, maritime law and agriculture. There has been good progress in JHA, Customs and Environment. The need for increased administrative capacity is a recurring theme in all areas of the report."

    Poland

    "Steps forward in all areas. Economic performance improved. Further efforts needed to strengthen administrative capacity on eg agriculture, food safety, fisheries, regional policy, environment, customs and JHA. Important to establish administrative capacity for sound management of EC funds."

    Slovakia

    "Good progress in addressing judicial reform, though continued efforts are needed to tackle corruption and protect minorities. Slovakia should be able to cope with competitive pressure within the Union by accession, provided current economic reforms continue, but macroeconomic difficulties remain. Very good progress has been made in legislative alignment, but further efforts are needed to strengthen administrative capacity."

    Slovenia

    "It has made very good progress in implementation and adoption of the acquis, particularly on Regional Policy and Financial Control. Progress made on the economic criteria must be reinforced by continuing structural reform. Progress made on judicial reform, but more necessary. All outstanding acquis­related legislation has now been passed. All the necessary institutions are now in place and there are no significant problems."

  1.5  The Minister summarises the progress reports on the three other candidate countries as follows:

    Bulgaria

    "Bulgaria is now a functioning market economy due to macroeconomic stability and its efforts towards privatisation. Legislative alignment is progressing in line with their 2007 target date. Important progress made in reforming the judiciary, but further effort required on this and administrative capacity."

    Romania

    "Romania has made good progress in some of the areas of strongest concern relating to the Copenhagen political criteria. It is still not a functioning market economy. The gap is growing between law aligned with acquis and Romania's capacity to implement it. Attention is drawn to the need for a comprehensive strategy for reforming the administration and the judiciary."

    Turkey

    "Although 'noticeable progress' made in recent years, does not yet fully meet the political criteria. Adoption of reforms this year were an important signal of the determination of the majority of Turkey's political leaders to move towards further alignment with the values and standards of the EU."

  1.6  As regards the problem of corruption, the Commission says that:

    "Progress has been made in the fight against corruption, fraud and economic crime, but this area remains a source of concern. Anti­corruption strategies are now in place in most countries and anti­corruption bodies have been further reinforced. Further progress has been made in terms of legislation, including in such areas as public procurement and the financing of political parties, and significant efforts have been made in terms of awareness raising. There are indications that in a number of countries, popular awareness of the dangers of corruption for the economy and society as a whole is increasing. Encouraging developments noted as regards transparency, accountability and efficiency of the public administration are of relevance also in this field. Efforts must be sustained."

CFSP and external relations (including trade)

  1.7  The reports on the individual candidates cover their progress on CFSP since the last Regular Report. Yet there is no summary of these findings in the Strategy Paper or in the EM or any indication of the Government's views. In general, all thirteen countries assessed are commented upon favourably. A number have contributed to international peacekeeping and observer operations and have aligned themselves with the EU Action Plan on Terrorism and the CFSP Common Positions on terrorism. They have also confirmed preparedness to contribute to the EU Rapid Intervention Force missions and to EU civilian instruments for crisis management, such as the EU Police Mission in Bosnia and Herzegovina.

  1.8  In some cases the reports indicate room for improvement.

  • Cyprus is said to maintain good, constructive relations with all its neighbours in the Middle East. It has contributed to the peace effort, facilitating meetings in Cyprus between Israelis and Palestinians and other parties and maintaining avenues of communication. Its role in accommodating the 13 Palestinians expelled from Bethlehem is mentioned. Relations with Turkey remain sensitive.

  • Hungary maintains its good track record. Bilateral relations with most neighbours are constructive but political tensions arose with Romania and Slovakia over the Law on Hungarians living in Neighbouring Countries — the "Status Law" which entered into force in January 2002. The law is broadly compatible with the recommendations of the Council of Europe's Commission for Democracy through Law — the "Venice Commission". Hungary has committed itself to repeal any provision incompatible with EC law, before accession.

  • Lithuania has continued to emphasise the development of its co­operation with the Russian region of Kaliningrad.

  • Poland has taken steps gradually to align itself with the Community's trade regime since the 1997 Commission Opinion which called for trade barriers to be eliminated. However, this Regular Report comments that on a number of occasions Poland adopted measures which led it away from the acquis on commercial policy rather than towards it.

  • Romania's relations with Hungary have improved with the conclusion in December 2001 of a Memorandum of Understanding on the implementation of the Hungarian "Status Law" and tensions noted in last year's Regular Report have diminished considerably. A dispute with Ukraine over demarcation of the border remains unresolved.

  • Slovakia unilaterally suspended tariffs on imports of 12 civil aircraft products. Despite the Commission's strong opposition, this exceptional measure which was due to end in December 2001 was extended to December 2002. Slovakia has a number of bilateral free trade agreements and the Commission comments that it needs to ensure that the EU is kept fully informed about existing agreements and about any negotiations on new ones with third countries. Slovakia will need to renegotiate or renounce all international agreements with third countries that are incompatible with its future obligations as an EU Member State. "Decisive steps are needed, as a matter of urgency, to bring bilateral investment treaties into conformity with the Treaty obligations. Failure to do so will mean that the conflict between the bilateral investment treaties and Treaty obligations will need to be resolved in the Accession Treaty".

  • Slovenia made progress with Croatia in resolving a number of outstanding issues through bilateral agreements but their ratification has come to a standstill, causing tensions between the two countries. Slovenia has made a considerable effort to support international peacekeeping missions.

  • Turkey plays an important role in promoting stability and security in the area of the Balkans, Caucasus and Middle East and has taken a number of initiatives. It organised a forum in February on "the harmony of civilisations" to promote dialogue and mutual understanding between the EU and Muslim countries across the world. Relations with Greece have improved and exploratory talks on the Aegean have started. The outstanding issues relating to the participation of Turkey in the decision­making process for EU­led operations using NATO assets need to be resolved as a matter of priority.

The Government's view

  1.9  The Minister tells us that the Government:

  • welcomes the recommendation that ten countries should be able to complete negotiations this year and join the EU in 2004;

  • welcomes the conclusions on Cyprus, and agrees with the Commission that accession by a united Cyprus would benefit all Cypriots;

  • welcomes the Commission's proposals for an enhanced road map and pre­accession strategy for Bulgaria and Romania, and wants the Copenhagen European Council in December 2002 to agree 2007 as a target date for their accession;

  • supports the Commission's view that Turkey has made "noticeable progress" towards meeting the political criteria, particularly in the last year, and believes that Turkey must be encouraged to pursue its reform process;

  • will continue its strong support for the efforts of candidate countries to implement and enforce the acquis, notably through DFID bilateral programmes, Action Plans and twinning projects;

  • sees merit in effective safeguard measures (following enlargement), which could provide helpful reassurance;

  • welcomes confirmation that decisions on financing enlargement will be based on the decisions taken in Berlin in 1999, considers that no candidate country should be a net contributor upon accession, and believes that a solution in respect of direct payments should be found that minimises the adverse economic impact they could have on the candidate countries;

  • believes that further efforts need to be made by the candidate countries in certain areas, despite the significant progress already made, including building administrative capacity and strengthening judiciaries, consolidating compliance with the political criteria (for example protecting minority rights), and pursuing anti­corruption policies;

  • believes that the case for leaving the British Sovereign Base Areas in Cyprus outside the EU remains valid.

Timetable

  1.10  The Minister set out the timetable for the progress towards accession of the ten candidates judged ready for accession in 2004. Since he signed the EM the Brussels European Council of 24­25 October has endorsed the findings and recommendations of the Commission and confirmed its determination to conclude accession negotiations with the ten candidate countries at the Copenhagen European Council on 12­13 December and to sign the Accession Treaty in Athens in April 2003. The Minister noted that the EU committed itself at the Seville European Council to agree all outstanding chapters by early November. The Accession Treaty will go to the European Parliament for its assent in March/April 2003, with a view to signature by the Member States and candidate country governments in mid­April. He comments that this will pave the way for ratification in time for enlargement by 2004.

Conclusions

  1.11  The Strategy Paper and Progress Reports make a positive assessment in the case of ten of the candidate countries. Nevertheless, the Commission points to a number of areas in which it expects further progress to be made before accession. In some candidates the rate of progress justifies this optimism. In others it appears less well founded. This matter and a number of others which we suggest below could be raised with the Minister during the debate.

General

  1.12  The Commission acknowledges in its Strategy Paper that people in the existing Member States have doubts about enlargement. It mentions in particular "perceived problems as to the preparedness of the candidates to join the Union". In analysing the progress made by the different candidates, it identifies several weaknesses common to a number of them, some of which give cause for "serious concern". The Minister, in his EM, also expresses concern at some of these weaknesses. He might be asked in each case what effect they are having on the UK now, and what could be the effect if they are still evident after the countries concerned have joined the EU. They include:

  • continuing high levels of organised crime and corruption in many candidate countries;

  • the quality and independence of the judiciary and trustworthiness of the criminal justice systems;

  • weaknesses in public administration which call into question the candidate's capacity for sound management of EC funds, and administration of the veterinary sector and of CAP support schemes, for instance where there is a need to get the Integrated Administrative Control System (IACS) in place, as in Poland;

  • discrimination against minorities, such as the Roma in Hungary and the Czech Republic. If discrimination continues, could this encourage a significant increase in migration to other Member States after enlargement?

Safeguards

  1.13  The Minister says that the Government looks forward to further information from the Commission on how the three safeguards it intends to put in place, summarised in the EM, will work. He says that he sees merit in effective safeguards, though the Government hopes that the candidates will have made sufficient progress before accession in the areas of the internal market and Justice and Home Affairs for these not to be needed.

  • is the Minister now in a position to provide a fuller picture of what the Commission has in mind on safeguards?

  1.14  Alan Mayhew of Sussex University, in a letter in the Financial Times of 28 October, describes the accession terms as "miserable" and suggests that the safeguards in the internal market discriminate against new Member States in favour of old ones.

  • is there a risk that the accession terms are not generous enough to win the approval of the voters in the candidate countries? In Poland, we understand that a 50% turnout will be required for a referendum on accession to be valid. Is the Government confident that referendums in the candidate countries will all result in a vote in favour of accession?

Agricultural subsidies

  1.15  Press coverage highlighted the deal struck between President Chirac and Chancellor Schröder on reform of the Common Agricultural Policy on 24 October. As the details of the deal are not yet available to us, we concentrate here on a few suggested questions directly related to enlargement. It is likely that we will shortly recommend a debate on the Floor of the House on the Commission Communication on the mid-term review of the CAP.

  • the press quoted Chirac as having pointed out that the UK will bear only a small proportion of the cost of enlargement. Would it be fair to say that the discrepancy in contributions towards enlargement between the UK and other Member States would not be so marked if more radical reform of the CAP had been agreed some years ago, for instance at the Berlin European Council in 1999?

  • the Prime Minister and other Government Ministers have referred to the Doha international trade round as a forum in which further pressure might be exerted for reform of the CAP. Commissioner Fischler's mid-term review has been quoted as providing another opportunity. What, realistically, are the prospects for reforming the CAP following agreement on the basis of the Franco­German deal, however it was modified following British representations, at the Brussels European Council?

Common Foreign and Security Policy

  1.16  The reports on the individual candidates cover their progress on CFSP since the last Regular Reports. The Minister does not offer any government view on any of these assessments by the Commission. In general, all thirteen countries are commented upon favourably.

  • does the Minister believe that the performance of the candidates as regards the CFSP should be taken into consideration when assessing whether they are fit to be members of the EU?

  • does he have any comment on the performance of any of the candidates in relation to CFSP?

  • Kaliningrad was due to be discussed at the Brussels European Council. What decision was taken in relation to this Russian enclave?

Cyprus and Turkey

  1.17  The Minister urges Turkey to support efforts to achieve a settlement. In the Financial Times of 25 October, the Turkish Ambassador to the EU is quoted as saying that if Cyprus is admitted as a divided island, EU leaders will be responsible for disrupting the strategic balance of the Mediterranean region. He is also quoted as saying that if the EU does not give Turkey a date for starting accession negotiations at the Copenhagen European Council in December, "it will be more than a disappointment for Turks — it will be a deception". The same article says that Washington has been applying pressure, particularly on Berlin, for the EU to give Turkey a date.

  • how does he anticipate that Turkey will react if no settlement on Cyprus is achieved before the Copenhagen European Council?

  • in his EM, the Minister describes the Government as a strong supporter of Turkey's EU aspirations. There have been suggestions in the press that the UK is promoting Turkey's candidacy as a reward for its co­operation in the "War against Terrorism". To what extent have considerations other than what that the Commission describes as Turkey's noticeable progress towards fulfilling the Copenhagen political criteria influenced the Government's attitude towards Turkey's candidacy?

  1.18  These documents form the basis for key decisions on enlargement and we recommend that they be debated in European Standing Committee B within the next month.



 
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