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European Integration Office

NATIONAL PLAN FOR THE ADOPTION OF THE ACQUIS (2013-2016)

February 2013
National Plan for the Adoption of the Acquis (2013-2016) Structure
INTRODUCTION ........................................................................................................................................... 7
1. POLITICAL CRITERIA .......................................................................................................................... 15
1.1. DEMOCRACY AND THE RULE OF LAW ................................................................................................... 15
1.2. HUMAN RIGHTS AND THE PROTECTION OF MINORITIES ........................................................................ 41
1.2.2. Civil and political rights ................................................................................................................ 45
1.2.3. Economic and Social Rights.......................................................................................................... 62
1.2.4. Cultural Rights and Minority Protection ....................................................................................... 67
1.3. REGIONAL COOPERATION AND INTERNATIONAL OBLIGATIONS .......................................................... 75
1.3.1. Regional Cooperation .................................................................................................................... 75
1.3.2. International obligations ................................................................................................................ 88
2. ECONOMIC CRITERIA ......................................................................................................................... 90
2.1. THE EXISTENCE OF A FUNCTIONING MARKET ECONOMY...................................................................... 90
2.1.1. Wide political consensus on the basics of economic policy.......................................................... 90
2.1.2. Macroeconomic Stability .............................................................................................................. 91
2.1.3. Prices and trade liberalization ....................................................................................................... 96
2.1.4. Ability of financial sector to direct savings towards productive investments ............................... 98
2.1.5. Ownership and restructuring of companies ................................................................................. 103
2.1.6. Absence of major obstacles for entering and exiting the market ................................................ 105
2.1.7. Legal system relating to economic issues ................................................................................... 111
2.2. ABILITY TO FACE COMPETITIVE PRESSURE AND OPEN-MARKET FORCES WITHIN EU ........................ 112
2.2.1. Human resources ......................................................................................................................... 112
2.2.2. Physical capital ............................................................................................................................ 118
2.2.3. Degree and Pace of Trade Integration with the EU ..................................................................... 129
2.2.4. Restructuring of Enterprises and Significance of Small and Medium Enterprises ..................... 130
2.2.5. Influence of the government policy and legislation on competitiveness..................................... 131
2.2.6. Sectoral reforms directed at increasing productivity and competitiveness ................................. 132
3. ABILITY TO ASSUME THE OBLIGATIONS OF EU MEMBERSHIP ......................................... 135
3.1. FREE MOVEMENT OF GOODS ............................................................................................................... 135
3.1.1 Horizontal issues .......................................................................................................................... 135
3.1.1.1. Standardisation ..................................................................................................................... 137
3.1.1.2 Accreditation ......................................................................................................................... 139
3.1.1.3. Conformity assessment ........................................................................................................ 140
3.1.1.4. Metrology ............................................................................................................................. 141
3.1.1.5. Market surveillance Product safety ................................................................................... 142
3.1.2 Old Approach Directives .............................................................................................................. 144
3.1.2.1. Motor vehicles ...................................................................................................................... 144
3.1.2.2. Chemicals and detergents ..................................................................................................... 145
3.1.2.3. Pharmaceuticals, medical devices, medical devices for active implantation and in vitro
diagnostic medical devices ................................................................................................................ 145
3.1.2.4. Cosmetics and the safety of toys .......................................................................................... 147
3.1.2.5. Glass ..................................................................................................................................... 148
3.1.2.6. Textile .................................................................................................................................. 149
3.1.2.7. Footwear ............................................................................................................................... 149
3.1.2.8. Fertilizers.............................................................................................................................. 150
3.1.2.9. Wood .................................................................................................................................... 150
3.1.3. New Approach Directives ........................................................................................................... 150
3.1.3.1. Low voltage electrical equipment ........................................................................................ 150
3.1.3.2. Simple pressure vessels ........................................................................................................ 151
3.1.3.3. Safety of machinery ............................................................................................................. 152

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3.1.3.4. Explosives for civil use and equipment and protective systems in potentially explosive
environments ..................................................................................................................................... 152
3.1.3.5. Lifts ...................................................................................................................................... 154
3.1.3.6. Pressure equipment .............................................................................................................. 154
3.1.3.7. Hot water boilers (boilers), gas appliances and refrigeration equipment ............................. 155
3.1.3.8. Radio and Telecommunications Terminal Equipment ......................................................... 156
3.1.3.9. Electromagnetic Compatibility ............................................................................................ 157
3.1.3.10. Recreational crafts .............................................................................................................. 158
3.1.3.11. Marine Equipment .............................................................................................................. 158
3.1.3.12. Cable cars to transport people ............................................................................................ 158
3.1.3.13. Construction Products ........................................................................................................ 158
3.1.3.14. Packaging and packaging waste ......................................................................................... 159
3.1.3.15. Personal protective equipment ........................................................................................... 159
3.1.4 Procedural Issues .......................................................................................................................... 160
3.2. FREEDOM OF MOVEMENT FOR WORKERS............................................................................................ 161
3.2.1. Access to labour market .............................................................................................................. 161
3.2.2. Coordination of social security systems ...................................................................................... 163
3.3. RIGHT OF ESTABLISHMENT AND FREEDOM TO PROVIDE SERVICES .................................................... 164
3.3.1. Establishment .............................................................................................................................. 164
3.3.2. Freedom to provide cross-border services................................................................................... 165
3.3.3. Postal services ............................................................................................................................. 170
3.3.4. Mutual recognition of professional qualifications ....................................................................... 171
3.4. FREE MOVEMENT OF CAPITAL ............................................................................................................ 172
3.4.1. Regime of movement of capital and current payments ............................................................... 172
3.4.2. The payment system .................................................................................................................... 174
3.4.3. Prevention of money laundering ................................................................................................. 176
3.5. PUBLIC PROCUREMENT ....................................................................................................................... 178
3.6. COMPANY LAW ................................................................................................................................... 184
3.6.1. Company law............................................................................................................................... 184
3.6.2. Accounting and auditing ............................................................................................................. 185
3.7. INTELECTUAL PROPERTY LAW .................................................................................................. 187
3.7.1. Copyright and Related Rights ..................................................................................................... 187
3.7.2. Industrial property rights ............................................................................................................. 188
3.7.3. Enforcement of intellectual property rights ................................................................................. 192
3.8. COMPETITION POLICY ........................................................................................................................ 198
3.8.1. Competition ................................................................................................................................. 198
3.8.2. State aid ....................................................................................................................................... 199
3.8.3. Liberalisation ............................................................................................................................... 202
3.9. FINANCIAL SERVICES .......................................................................................................................... 203
3.9.1. Banking ....................................................................................................................................... 203
3.9.2. Insurance ..................................................................................................................................... 205
3.9.3. Capital market ............................................................................................................................. 207
3.9.4. Voluntary pension funds ............................................................................................................. 209
3.10. INFORMATION SOCIETY AND MEDIA ................................................................................................. 211
3.10.1 Telecommunications and information technology ..................................................................... 211
3.10.2. Information Society ................................................................................................................... 216
3.10.3. Audiovisual policy .................................................................................................................... 219
3.11. AGRICULTURE AND RURAL DEVELOPMENT ..................................................................................... 223
3.11.1. Agriculture ................................................................................................................................ 223
3.11.2. Rural Development.................................................................................................................... 228
3.11.3. Organisation of Agricultural Market ......................................................................................... 232
3.11.4. Quality Policy ............................................................................................................................ 237
3.11.5 Organic Farming ........................................................................................................................ 243
3.12. FOOD SAFETY, VETERINARY AND PHYTOSANITARY POLICY ........................................................... 246
3.12.1. Food Safety and Control............................................................................................................ 246

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3.12.2. Plant Health ............................................................................................................................... 249
3.12.3. Seeds and Plant Propagation Material ....................................................................................... 251
3.12.4. Plant Protection Products and Residues .................................................................................... 253
3.12.5 Veterinary Policy........................................................................................................................ 257
3.12.7. Genetically Modified Organisms .............................................................................................. 266
3.13 FISHERIES........................................................................................................................................... 282
3.14. TRANSPORT POLICY .......................................................................................................................... 286
3.14.1. Land transport ........................................................................................................................... 286
3.14.1.1. Road transport .................................................................................................................... 286
3.14.1.2. Rail transport ...................................................................................................................... 293
3.14.1.3. Intermodal (combined) transport ........................................................................................ 298
3.14.2. Water transport .......................................................................................................................... 300
3.14.3. Air transport .............................................................................................................................. 305
3.15. ENERGY ............................................................................................................................................ 310
3.15.1. Energy Market and Security of Energy Supply ......................................................................... 310
3.15.2 Energy Efficiency and Renewable Energy Sources ................................................................... 315
3.15.3. Nuclear Safety and Radiation Protection .................................................................................. 321
3.16. TAXATION ......................................................................................................................................... 322
3.17. ECONOMIC AND MONETARY POLICY ................................................................................................ 333
3.17.1. General guidelines ..................................................................................................................... 333
3.17.2. Monetary policy ........................................................................................................................ 334
3.17.3. Economic policy ........................................................................................................................ 339
3.18. STATISTICS........................................................................................................................................ 343
3.18.1. Legal framework ....................................................................................................................... 343
3.18.2. Demographic-social statistics .................................................................................................... 345
3.18.3. Environmental statistical data ................................................................................................... 348
3.18.4. Macroeconomic statistics .......................................................................................................... 350
3.18.5. Business statistics ...................................................................................................................... 353
3.18.6. Monetary, financial, trade statistics and statistics on balance of payments .............................. 356
3.18.7 Agricultural statistics .................................................................................................................. 358
3.18.8. Registers (statistical) ................................................................................................................. 361
3.18.9. Classifications ........................................................................................................................... 362
3.18.10. Dissemination .......................................................................................................................... 364
3.18.11 Information and communication technology............................................................................ 364
3.19. SOCIAL POLICY AND EMPLOYMENT ................................................................................................. 369
3.19.1. Labour Legislation .................................................................................................................... 369
3.19.2 Safety and Health at Work ......................................................................................................... 370
3.19.3 Social Dialogue .......................................................................................................................... 373
3.19.4 Employment and European Social Fund .................................................................................... 374
3.19.5 Social Inclusion .......................................................................................................................... 377
3.19.6 Social insurance.......................................................................................................................... 381
3.19.7 Anti-discrimination and equal opportunities .............................................................................. 382
3.19.8 Cooperation in the area of social policy and employment ......................................................... 384
3.20. ENTERPRISE AND INDUSTRIAL POLICY ............................................................................................. 386
3.20.1. Industrial strategy ...................................................................................................................... 386
3.20.2. Privatisation and restructuring................................................................................................... 387
3.20.3. Business environment................................................................................................................ 389
3.20.4 Policy of small and medium-sized enterprises ........................................................................... 392
3.21. TRANS-EUROPEAN NETWORKS ......................................................................................................... 398
3.21.1 Trans-European transport networks ........................................................................................... 398
3.21.2. Trans-European energy networks .............................................................................................. 401
3.21.3. Trans-European Communication Networks .............................................................................. 401
3.22. REGIONAL POLICY AND COORDINATION OF STRUCTURAL INSTRUMENTS ........................................ 403
3.23. JUDICIARY AND FUNDAMENTAL RIGHTS.......................................................................................... 410
3.23.1. Judicial system .......................................................................................................................... 410

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3.23.2. Anti-corruption policy ............................................................................................................... 428
3.23.3. Fundamental rights .................................................................................................................... 434
3.24. JUSTICE, FREEDOM AND SECURITY ................................................................................................... 438
3.24.1. External borders ........................................................................................................................ 438
3.24.2. Migration Management ............................................................................................................. 440
3.24.3. Visa policy................................................................................................................................. 444
3.24.4. Asylum ...................................................................................................................................... 445
3.24.5. Police cooperation and the fight against organised crime ......................................................... 446
3.24.6. Fight against terrorism............................................................................................................... 454
3.24.7. Cooperation in the fight against drugs ...................................................................................... 455
3.24.8. Customs cooperation ................................................................................................................. 456
3.24.9. Judicial cooperation in criminal and civil matters ..................................................................... 459
3.25. SCIENCE AND RESEARCH .................................................................................................................. 463
3.26. EDUCATION AND CULTURE .............................................................................................................. 466
3.26.1. Education................................................................................................................................... 466
3.26.2. Youth ......................................................................................................................................... 472
3.26.3. Culture ....................................................................................................................................... 477
3.27. ENVIRONMENT .................................................................................................................................. 480
3.27.1. Overview ................................................................................................................................... 480
3.27.2. Horizontal Legislation ............................................................................................................... 482
3.27.3. Climate Change and Air Quality ............................................................................................... 490
3.27.4. Waste management.................................................................................................................... 507
3.27.5. Water Protection and Management ........................................................................................... 513
3.27.6. Nature Protection....................................................................................................................... 521
3.27.7. Control of industrial pollution and risk management ................................................................ 528
3.27.8. Genetically Modified Organisms .............................................................................................. 536
3.27.9. Chemicals .................................................................................................................................. 536
3.27.10. Protection against Noise .......................................................................................................... 542
3.27.11 Forestry..................................................................................................................................... 544
3.27.12. Civil Protection ....................................................................................................................... 547
3.28. HEALTH AND CONSUMER PROTECTION............................................................................................. 550
3.28.1. Consumer protection ................................................................................................................. 550
3.28.2. Health protection ....................................................................................................................... 554
3.28.2.1. Biomedicine ....................................................................................................................... 554
3.28.2.2. Public Health ...................................................................................................................... 559
3.28.2.3. Screening ............................................................................................................................ 559
3.28.2.4. Communicable diseases ..................................................................................................... 560
3.29. CUSTOMS UNION ............................................................................................................................... 562
3.30 FOREIGN ECONOMIC RELATIONS ....................................................................................................... 570
3.30.1 Common Trade Policy ............................................................................................................... 570
3.30.2 The policy of Development and Humanitarian Aid ................................................................... 575
3.31. FOREIGN, SECURITY AND DEFENCE POLICY .................................................................................... 575
3.31.1. Political Dialogue ...................................................................................................................... 575
3.31.2. Cooperation with International Organisations........................................................................... 576
3.31.3. Armaments Control ................................................................................................................... 579
3.31.4. Implementation of Restrictive Measures and Economic Sanctions .......................................... 581
3.31.5. Common Security and Defence Policy...................................................................................... 582
3.32. FINANCIAL CONTROL ....................................................................................................................... 582
3.32.1. External (State) Audit................................................................................................................ 582
3.32.2 Public Internal Financial Control ............................................................................................... 584
3.33. FINANCIAL AND BUDGET PROVISIONS ............................................................................................. 586
APPENDIX A THE PLAN OF HARMONISATION OF LEGISLATION OF THE REPUBLIC OF
SERBIA WITH EUROPEAN UNION ACQUIS COMMUNAUTAIRE ............................................... 589
A) LIST OF LAWS AND BYLAWS PLANNED FOR 2013 ................................................................................. 589

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B) LIST OF PLANNED BYLAWS FOR 2013 PASSED ON THE BASIS OF PREVIUOSLY ADOPTED LAWS ........ 607
APPENDIX B PLANNED BUDGET ....................................................................................................... 639
1. POLITICAL CRITERIA ............................................................................................................................. 639
2. ECONOMIC CRITERIA ............................................................................................................................. 640
3. CAPACITY FOR TAKING OVER RESPONSIBILITIES RESULTING FROM EU MEMBERSHIP ....................... 641
APPENDIX C - PRELIMINARY LIST OF EUROPEAN UNION LEGISLATIVE ACTS TO BE
TRANSLATED IN 2013 ............................................................................................................................. 649

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INTRODUCTION

A. Overview of relations between the Republic of Serbia and the European Union
2000-2013
Serbia, as part of the Federal Republic of Yugoslavia, became part of the Stabilisation and Association
Process (SAP) in November 2000. As of 2001 Serbia has at its disposal all the measures and instruments of
this process, including the incorporation of Serbia to the list of countries that have an option of duty-free ex-
port of the largest number of products to the EU market under the so-called Autonomous Trade Measures
even before signing the Stabilisation and Association Agreement.
However, the decision on opening negotiations for the conclusion of the Stabilisation and Association
Agreement (hereinafter: SAA) was adopted in April 2005, after the acceptance of a principle of double-
track approach to the negotiations with the State Union of Serbia and Montenegro, when the EU agreed to
separate talks with Montenegro and Serbia on trade relations in accordance with competences of the Member
Republics under the Constitutional Charter of the State Union of Serbia and Montenegro. The negotiations
officially started on 10 October and the first official round was held on 7 November 2005. In May 2006, the
negotiations on SAA were cancelled by the decision of the European Commission, after which they were
reopened on 10 June 2007 and successfully concluded on 7 November 2007 by concluding the Stabilisation
and Association Agreement. The Stabilisation and Association Agreement and the Interim Agreement on
Trade and Trade-Related Matters (hereinafter: ITA) were signed on 29 April 2008 at the meeting of the EU
General Affairs and External Relations Council in Luxembourg. Nevertheless, the European Union decided
not to implement the ITA until Serbia had achieved a satisfactory level of cooperation with the International
Criminal Tribunal in The Hague.
The National Assembly of the Republic of Serbia ratified the SAA and ITA on 9 September 2008
(Law Ratifying the Stabilisation and Association Agreement between the European Communities and their
Member States on one side and the Republic of Serbia on the other and the Law Ratifying the Interim
Agreement on Trade and Trade-related Matters between the European Community on one side and the Re-
public of Serbia on the other, Official Gazette of RS No. 83/08). ITA came into force on 1 February 2010
after being ratified by the EU institutions in December 2009. SAA is still in ratification phase in the EU and
so far it has been ratified by 26 of 27 EU Member States.
With the intention to accelerate the integration process and show commitment to the process as well as
to strengthen the position before envisaged submission of the application for the accession to the EU, Serbia
started to implement the ITA and carry out its obligations therewith on 1 January 2009. The EU started with
ITA implementation on 8 December 2009 after assessing that Serbia had achieved a satisfactory level of co-
operation with the International Criminal Tribunal in The Hague. Serbia and the EU entered the fifth year of
ITA implementation on 1 January 2013.
Together with negotiations on this Agreement, the European integration process of the Republic of
Serbia was underway. In October 2004, the National Assembly adopted the Resolution on Accession to the
European Union (Official Gazette of RS No. 112/04) stressing that the strategic orientation of Serbia is
membership in the European Union. In June 2005, the Government adopted the National Strategy for Acces-
sion of Serbia and Montenegro to the European Union as an umbrella document for the whole process of
European integration. The Strategy envisaged activities that Serbia should undertake by 2012 in all sectors of
its society, political and legal system in order to be prepared for the accession negotiations i.e. to assume the
obligations of membership in the European Union.
Since 2004, the Republic of Serbia drafts annual action plans for the implementation of the European
Partnership. In 2004, although without a legal obligation, given that the SAA had not yet been signed, the
Republic of Serbia started the process of harmonisation of domestic legislation with EU law, and each year
until 2008, adopted an Annual Harmonization Action Plan.
By signing the SAA in 2008, the Republic of Serbia started a new phase in relations with the EU. For
the first time, relations with the EU are based on contractual obligations. By signing the SAA, Serbia com-
mitted to gradual harmonisation of domestic legislation with EU law, formerly known as acquis communau-
taire and now as the EU acquis (hereinafter: EU law) and its consistent application. Pursuant to Article 72 of
the SAA, Serbia undertook the commitment to prepare, in agreement with the European Commission, a spe-
cial Programme to monitor the implementation of the obligations laid down in the SAA. The EU monitors
the approximation of legislation and implementation of the laws laid down in that Programme. Pursuant to

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Article 72, harmonisation began with the day of signing of the SAA in accordance with arranged transitional
timeframes.
On 9 October 2008, Serbia adopted the National Programme of Integration of the Republic of Serbia
into the EU for 20082012 (NPI) in order to fulfil the obligations under the SAA and to establish a compre-
hensive and systemic multiannual programme for the harmonisation with EU law, thus showing the existence
of the required administrative capacity. It was common from previous practice in the EU enlargement proc-
ess was that such document was usually drafted by countries with candidate status for EU membership in
preparation for the accession negotiation. However, Serbia, although without candidate status at the time,
decided to draft such a programme and show commitment to observe contractual obligations and present real
administrative capacities. The document envisaged legislative activities in the following four years, aimed at
further harmonisation with EU law. NPI represents the first multiannual programme for harmonisation with
EU law. Accomplishment of the NPI in the period from 1 July 2008 to 31 December 2012 was at a level of
88% (1030/1172), considering that from 1172 planned measures, 1030 were adopted, and the adoption of
243 laws was planned where 201 were adopted representing 83% of the programme accomplishment.
Simultaneously with the implementation of the ITA, the NPI integration process was moving forward.
Visas for travelling to countries of the Schengen Agreement were abolished for Serbian citizens on 30 No-
vember 2009. Serbia officially submitted the application for EU membership on 22 December 2009. On 14
June 2010, the EU Foreign Affairs Council adopted a decision on the beginning of ratification of the SAA
with Serbia, thus providing approval for the European Commission to start with the procedure of assessment
of the Serbian application for EU membership. On 25 November 2011, Serbia received the EC Questionnaire
consisting of 2563 questions based on which the EC made the assessment of the possibilities of the admis-
sion of Serbia into the EU. Serbia submitted the Replies in 45 working days i.e. on 31. January 2011.
Based on Serbian Replies to the Questionnaire, on 12 October 2011 the EC published the Opinion on
the Serbian application for EU membership (the so-called Avis) and recommended giving Serbia candidate
status and opening accession negotiations, providing conditions regarding the matter of Kosovo and Meto-
hija. On March 2012, based on the EC Opinion and the progress achieved in the dialogue with temporary
institutions in Pristina, the European Council adopted the Conclusion granting candidate status to the Repub-
lic of Serbia. Therewith, Serbia officially received the status of candidate for EU membership.
In the Annual Progress Report for Serbia, published in 2012, the European Commission reiterated the
criteria for opening accession negotiations given in the Opinion from 2011 and confirmed that it will present
the Report as soon as it assesses that Serbia had achieved a satisfactory level in fulfilling membership crite-
ria, and specifically in relation to the key priority regarding concrete steps towards a visible and sustainable
improvement of relations with Kosovo.
On 1314 December 2012, the European Council welcomed and accepted the Councils Conclusions
from 11 December on Enlargement and the Stabilisation and Association Process, calling upon the European
Commission and the High Representative to present a report in spring 2013 based on which a decision will
be made on opening accession negotiations with Serbia.
The next step towards EU membership is opening accession negotiations that will lead to further har-
monisation of domestic legislation with EU law.
In such circumstances, Serbia adopted a new multiannual programme for harmonisation of domestic
legislation with EU law called the National Programme for the Adoption of the Acquis NPAA for 2013
2016. The implementation period will last from 1 March 2013 to 31 December 2016.
B. Objectives of the National Programme for the Adoption of the Acquis NPAA
20132016
A candidate country preparing for the opening of accession negotiations is expected to adopt a docu-
ment titled National Programme for the adoption of the Acquis NPAA (hereinafter:NPAA)1. The document
defines development and strategic goals, relevant policies, reforms and measures required for the realisation
of these goals, establishes a detailed plan for harmonisation of legislation and defines human and budget re-
sources and other funds required for the implementation of envisaged tasks.
In order to prepare for new challenges and obligations in the process of accession to the EU, to fulfil
requirements under the SAA/ITA, to prepare for accession negotiations and, in a comprehensive manner,

1
This abbreviation has been settled since the middle of the 90s for the document drafted by the candidate countries for
EU membership.

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respond to obligations that Serbia will undertake in the process of negotiations for EU membership, it is nec-
essary to prepare a comprehensive document allowing for the integration of existing documents and planning
and monitoring of all future government activities in the process of accession to the EU, as well as their effi-
cient coordination. Considering that Serbia adopted the NPI in 2008 and successfully implemented it in the
past five years, the NPAA essentially represents its successor and further elaborates it, with the addition of
one new goal i.e. the implementation of the obligations taken in the period preceding the expected accession
negotiations.
The NPAA should become one of the key Government documents in the following years. It will serve
as an instrument of reform coordination on the road to the EU and as the basis for drafting annual Govern-
ment work plans. As a systematic, transparent and well prepared plan of reforms in a numerous areas, the
NPAA will also represent an important source of information for the Serbian society and economy on one
hand and for the European Commission and the EU Member States on the other. As such, it represents a
valuable instrument for promoting transparency of the Governments work and the whole accession process
to the European Union.
The NPAA establishes not only obligations regarding transposition of EU law into domestic legal or-
der but also tasks that should be implemented in order to fulfil political and economic criteria for accession
to the EU (Copenhagen criteria from 1993 and Madrid criteria from 1995).
The NPAA defines development and strategic goals on one hand and policies, reforms and measures
required for the realisation of these goals on the other. It also establishes a detailed plan, time frame and pri-
orities for the adoption of legislation and appoints bodies responsible for their implementation.
Full realisation of the goals set in NPAA is envisaged to be completed by 31 December 2016 and after
that the adoption of a new document will be considered depending on the progress and results expected in
the framework of the EU accession negotiation.
NPAA is a document of the Government of Serbia. It will be submitted to the National Assembly for
the purpose of familiarising with its content, considering that the Assembly must be regularly informed about
the whole process. During the implementation of the NPI, the European Integration Committee of the Na-
tional Assembly regularly discussed the Governments reports on the implementation of the NPI and that
practice will continue in the reporting on the implementation of the NPAA. The part of the NPAA relating to
the adoption of laws transposing EU law into domestic legislative system will be of extreme importance for
planning activities of the National Assembly, having in mind that the National Assembly, as a legislative
authority, follows the schedule for the adoption of laws set in the NPAA, as well as for proper insight into
the legislative activity of the Government and planning of own activities.
C. Grounds for the adoption
By the Conclusion 05 No. 021-387/2012 from 26 January 2012 adopting the third amended National
Programme for Integration of the Republic of Serbia into the European Union (NPI), the Government
charged the Serbian European Integration Office with the obligation to submit draft National Programme for
the Adoption of the Acquis, which was to be prepared in cooperation with all competent state administration
bodies, to the Government for discussion and adoption of the proposal.
The Stabilisation and Association Agreement prescribed that the harmonisation of domestic legislation
with the EU acquis starts with the date of signing the Agreement and that it will gradually, by the end of the
transitional period lasting no more than six years, expand to cover the acquis communautaire referred to in
the Agreement. In that regard, under Article 72(3) of the SAA, harmonisation will be implemented on the
basis of a special programme, agreed between the European Commission and Serbia.
D. Setting priorities set out in the document
In setting priorities for harmonisation of the laws, the following documents were taken into account:
- Interim Agreement on Trade and Trade-related Matters and the Stabilisation and Association
Agreement2.

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The Law Ratifying the Stabilisation and Association Agreement between the European Communities and their Mem-
ber States on one side and the Republic of Serbia on the other and the Law Ratifying the Interim Agreement on Trade
and Trade-related Matters between the European Community on one side and the Republic of Serbia on the other were
published in the Official Gazette of RS No. 83/08 from 10 September 2008.

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- Assessments given in the European Commission Annual Progress Report of the Republic of Serbia
in the European Integration Process for 2010 (hereinafter: Annual Report) and The Analytical Re-
port accompanying the European Commission Opinion on the Serbian application for EU member-
ship (hereinafter: Analytical Report).
- Plans of competent institutions relating to the preparation of the Governments work plan for 2013.
- Sectoral and general national strategies, in order to achieve coherence in planning and execution of
measures.
- Constantly taking into account the adoption of new, and repealed and amended existing EU legisla-
tion.
Competent institutions had the task to determine dynamics and priorities in the alignment process for
2013, on a quarterly basis, while for the following three years of the implementation of the document they
were required to provide only framework plans regarding the harmonisation process, which will be elabo-
rated in the course of annual reviews and adjusted to the dynamics of the process of accession of the Repub-
lic of Serbia to the European Union.
Coordination and consultations with regard to setting priorities and deadlines were carried out within
competent subgroups of the Expert Group, while the exact dynamics schemes for harmonisation were pre-
pared by the competent authorities within the state administration.
E. Preparation of the document within the Coordination Body for the EU Accession
Process
Same as the preparation of the NPI, the preparation of the NPAA was organized under the structure of
the body established by the Decision on the Establishment of the Coordination Body for the EU Accession
Process.
By adopting the Decision on the Establishment of the Coordination Body for the EU Accession Proc-
ess (Official Gazette of RS No. 93/12) and accompanying decisions on appointments (Official Gazette of RS
No. 111/12 and 116/12), the Government revised the system of the bodies responsible for coordinating the
process of accession to the European Union (Coordination Body, Coordination Body Expert Group, 35 sub-
groups for the preparation and negotiations on accession to the EU), considering the election of the new gov-
ernment and provisions of the Law on Ministries (Official Gazette of RS No. 72/12).
Continuity was thus provided in the operation of the system of the bodies responsible for the coordina-
tion of the process of accession to the European Union, established by the Decision adopted by the govern-
ment in 2007, within the process of drafting the NPI. Since 2007, the composition of the body was adapted
in line with all changes in the Governments composition and the scope of ministries and special organiza-
tions. In elaborating this coordinating structure the following was taken into account: European Unions ex-
periences in negotiations, best practice from countries that became members in previous enlargements and
size and capacity of the domestic administration. The structure includes three levels of coordination of com-
petent institutions and is based on provisions of the Regulation on the Principles of Internal Organisation and
Systematisation of Job Positions in Ministries, Special Organisations and Government Services.
F. Implementation period
The implementation of the document was envisaged to last from 2013 and cover the four year period,
until 31 December 2016. The document will be revised annually in accordance with steps taken and devel-
opment in the process of accession negotiations.
The Office will prepare quarterly implementation reports and submit them to the Government for dis-
cussion and approval, and to the National Assembly and the National Bank of Serbia for information pur-
poses. The Office will also regularly publish adopted quarterly reports on its website.
G. Document structure
The structure of the NPAA consists of three basic parts and three Addenda.
Basic parts of the document:
1. Political criteria
2. Economic criteria
3. Ability to assume the obligations of membership

10
Addenda:
1. Appendix A Plan for harmonisation of Serbian legislation with the EU acquis and overview of imple-
menting measures
2. Appendix B Planned budget appropriations;
3. Appendix C Measures planned within the framework of the process of translation and drafting of the
national version of the EU acquis.
Structure of the basic parts Political criteria, Economic criteria and Ability to
assume the obligations of membership
The parts of the document dedicated to political and economic criteria and ability to assume the obli-
gations of membership start with an overview of a certain field with the most significant activities in 2012.
Following the overview, each subheading under the basic parts covers:
Priorities for 2013 with regard to harmonisation of legislation, including: description of priorities
achievable by a single legal measure; list of specific EU regulations that serve as the basis for harmonisation
or specific provisions in EU regulations where possible or relevant; level of compliance with a specific EU
regulation that will be achieved.
At the same time, relation between the planned priority and strategic document will be shown
for example, connection with the Analytical Report, Annual Report, ITA, SAA etc.
Each subheading under the basic parts of the document also includes a brief overview of the current
state of affairs regarding administrative capacities (this part contains data only for the starting year of the
application of the NPAA, without projections for the next three years, with planned elaborations with each
annual revision of the document).3
Measures for implementation of priorities, that cover all other activities, including non-legislative
measures in connection with the legislation harmonisation process and/or application of the legislation aligned
with the EU acquis, are also a constituent part of the text of the document. Given measures are defined in the
manner as to allow them to relate to drafting of and adopting strategies, plans, programmes, implementation
plans for specific EU regulations and other legal acts and their implementation (legislative measures not trans-
posing EU regulation but implementing a specific requirement from a provision of the EU regulation, ITA or
SAA provisions, recommendation from the Annual Report or Analytical Report, or introducing economic in-
struments required for the implementation of EU regulations etc.), as well as to the overview of envisaged insti-
tutional measures (establishment of new institutions and working bodies) and to the strengthening of
administrative capacities (recruiting new employees, procurement of technical equipment, trainings and voca-
tional training) in connection with the EU accession process. Where measures for implementation of priorities
are given, the document notes the relation with the EU acquis and the strategic document establishing the obli-
gation for implementation of the measure Analytical Report, Annual Report, ITA, SAA.
The document also contains a projection for the next three years of NPAA implementation
measures planned for the period 2014-2016 are defined roughly, because a detailed plan for each year of the
document implementation will be elaborated and defined with the annual revision of the NPAA.
Where possible, parts of the document provide for an overview of measures relating to the imple-
mentation of obligations under the ITA and SAA that were planned for 2013.
In accordance with defined priorities, the document also provides an overview of the current and
planned international development assistance i.e. projects and programmes financed from development
assistance funds supporting NPAA implementation, which includes cooperation and assistance programmes
with the European Union, other multilateral sources of assistance, bilateral assistance programmes and loans
from international financing institutions (assistance, donations, loans). The overview covers programmes and
projects that are to be implemented in 2013 (regardless whether the implementation started in previous years
or in 2013), the total budget for the programme/project, source of financing, and a short description of the
programme/project objectives in the part relating to implementation of the NPAA.
Data shown under political and economic criteria significantly impact the third part of the document
Ability to assume the obligations of membership considering that it is relevant that all envisaged legislative

3
Decision on maximum number of employees in public administration bodies, public agencies and organisations for
compulsory social security (Official Gazette of the RS 109/09, 5/10, 29/10, 43/10, 46/10, 50/10, 51/10, 64/10, 67/10,
73/10, 74/10, 75/10, 79/10, 84/10, 87/10, 89/10, 97/10, 100/10, 1/11, 4/11, 12/2011, 32/11, 33/11, 34/11, 39/11, 44/11,
63/11, 80/11, 89/11, 93/11, 98/11, 2/12, 13/12, 18/12, 55/12, 93/12, 98/12 and 100/12.)

11
changes in the third part be compliant with the fulfilment of political criteria and planned dynamics of eco-
nomic reforms.
Regarding the defining of priorities in this document (legislative activities or measures for implemen-
tation of priorities) that the Republic of Serbia should implement during the accession negotiation process, in
the following period we will show obligations under benchmarks for opening and closing of chapters and
other official documents from the accession negotiations process.
Appendix A Plan for harmonisation of Serbian legislation with the EU acquis
For 2013, Appendix A includes a list of legislative measures planned for this year, given in accordance
with the document structure and consists of two tables a) and b):
- Table a) contains planned laws and accompanying bylaws;
- Table b) contains an overview of planned bylaws to be adopted on the basis of previously adopted
laws.
Tables show legislation planned for adopting in 2013 with the following accompanying data: code of
planned regulation (generated by entering planned regulation into NPAA electronic database); title of regula-
tion, institution competent for its preparation; place in the NPAA structure; timeframe, given on quarterly
basis, for endorsing the draft/adoption by the Government/competent institution; CELEX number of the EU
regulation being harmonised with; indicator whether the EU regulation has been translated or is in the proc-
ess of translation.
In the following period, in the course of NPAA revisions one part of Appendix A will be elaborated,
and will relate to measures for implementation of the defined priorities in the EU accession process. This
part of Appendix A will contain a table overview of all measures for implementation of priorities that are
elaborated in detail in textual parts of the NPAA and that, inter alia, entail adoption of strategies, plans, pro-
grammes, establishment of new institutions, strengthening of administrative capacities and similar.
Regarding the overview of activities (legislative activities or measures for implementation of priori-
ties) that Serbia would have to implement in the accession negotiation process in the following period, Ap-
pendix A will also contain obligations under under benchmarks for the opening and closing of chapters.
Appendix B Planned budget appropriations
This Appendix contains projections regarding budget appropriations for financing activities of the EU
membership criteria in 2013.
When all required preconditions regarding the application of programme budgeting have been met, the
table of planned budget appropriations should provide an insight into budget funds shown per chapters under
the relevant textual part of the NPAA, for activities and projects relating to the EU accession process i.e. fulfil-
ment of the criteria for EU accession.
Pursuant to the Law on Budget of the Republic of Serbia for 2008, for the first time, five direct budget
beneficiaries presented their financial plans in line with the programme budgeting model. At this point, de-
velopment of the programme budgeting model does not provide for preparation of the said part of Appendix
B. In the following period, the preparation of this Appendix will be organised depending on dynamics of the
introduction of the programme budgeting model, considering that, in accordance with the Law on the Budget
System, programme budgeting is planned to be introduced with the adoption of the Law on Budget of the
Republic of Serbia and decisions on budget of local governments for 2015.
In addition, the Law on Budget of the Republic of Serbia for 2010 introduced for the first time an
overview of budgetary resources allocated for co-financing and pre-financing of projects approved under the
first and second component of the Instrument for Pre-Accession Assistance IPA. In that regard, Appendix
B also contains summary information on budgetary resources for co-financing and pre-financing of IPA pro-
jects and sector programmes in accordance with the Law on Budget of the Republic of Serbia for 2013 for
projects and sector programmes referred to in the basic parts of the document.
Appendix C Measures planned within the framework of the process of translation
and drafting of the national version of the EU acquis
Legislative measures laid down in the NPAA will be connected with annual plans for translation and
drafting of the national version of the EU acquis. This way, a systematic approach to the EU acquis align-
ment and its translation, as one of the preconditions for the accession to the EU, will be accomplished.

12
The national version of the EU acquis entails only legally binding EU acts. Nominating priorities for
translation will be carried out, as has been so far, through the portal for nominating priorities, and priorities
will be entered by coordinators for expert review in relevant public administration bodies. It is necessary that
nominations first cover all EU legal acts that are already referred to in the NPAA. Based on nominated pri-
orities for translation, the list will be compiled and will be updated once again during the year.
The NPAA electronic database will contain data on translated EU legal acts, and after the expert revi-
sion is completed, translations will be available to all civil servants through electronic means.
Electronic database accompanying the National Programme for the Adoption of the
Acquis
As a preparatory step for the adoption of the NPI, in September 2008 the electronic database accom-
panying this programme was set up and put into operation. This database will continue to function as the ac-
companying database of the NPAA. Access to database, like so far, is available only for registered users,
representatives of institutions included in drafting and implementation of the NPAA. The electronic database
supporting NPAA shall provide data on the connection between EU regulations and the domestic legal sys-
tem (current and planned) aimed at creating a clear picture about at what point, in what extent and in which
manner as well as with which legal acts the provisions from certain fields of EU law will be transposed into
domestic legal system.
The basic purpose of the database is to facilitate planning and monitoring of the implementation of the
obligations in the process of harmonisation with EU law. The NPAA database shall contain data on domestic
legal acts that are relevant from the point of the harmonisation of domestic legislation with EU law, as well
as data on European Union regulations. Besides data on acts, the database shall contain information on inter-
connection between domestic legal acts as well as between domestic regulations and those of EU law. Data
shall relate to acts that are in force (existing legislation) as well as drafts i.e. draft proposals whose adop-
tion is planned on a quarterly basis (planned legislation). Data on domestic legal acts shall be entered by
authorised representatives of institutions competent for preparing the regulations. Data on EU regulations,
including changes (new acts, repealed acts etc.) are entered into the NPAA database by the Serbian European
Integration Office. The source of data on European Union acts is the Progress Editor, an application (pro-
gramme) of the European Commission.
Based on data from the electronic database, regular quarterly and annual reports on NPAA implemen-
tation are prepared and submitted to the Government for discussion and adoption and to the National Assem-
bly and the National Bank of Serbia for information purposes.

13
1. POLITICAL CRITERIA

1.1. Democracy and the rule of law


1.1.1. Constitution
The National Assembly of the Republic of Serbia at the session held on 8 November 2006, adopted the
Decision on Promulgation of the Constitution of the Republic of Serbia (Official Gazette of RS No 98/06).
The National Assembly adopted the Constitutional Law on Implementation of the Constitution of the Repub-
lic of Serbia at the session held on 10 November 2006. In accordance with the Constitutional Law, a large
number of laws adapting the system of government to the newly adopted highest act have been adopted.
Overall, the Serbian Constitution is almost completely in compliance with the European standards and good
practice, as well as with recommendations of the Venice Commission, which is also highlighted by the
European Commission in its Progress Report for Serbia published on 10 October 2012 (page 6 of the source
text in English). All potential amendments to the Constitution that will be required in the further process of
approaching full membership in the European Union will be adopted in accordance with the procedure (Arti-
cles 203 to 205) regulating constitutional amendments.

1.1.2 National Assembly


Overview and planned activities
The National Assembly is the highest representative body and the holder of constitutional and legisla-
tive powers in the Republic of Serbia. It consists of 250 Members of Parliament whose mandate lasts for four
years and who are elected by direct universal suffrage. After parliamentary elections, held on 6 May 2012,
new convocation of the National Assembly was constituted and eleven parties or coalitions acquired mandate
for Members of Parliament. At this moment (December 2012), there are 13 parliamentary groups in the Na-
tional Assembly and eight MPs outside existing groups acting independently.
Aside from the fact, as provided for by the Constitution of the Republic of Serbia in defining its status
and in the light of the principle of separation of powers, that the National Assembly is the holder of constitu-
tional and legislative powers, it also performs representative, control and electoral functions.
The representative function of the National Assembly is exercised through the establishment and de-
velopment of relations between citizens and MPs. For the exercising this function, it is especially important
to ensure transparency of work of the National Assembly through television coverage of its sessions, pub-
lishing information, acts and documents, as well as minutes, reports and stenographic notes from the sessions
of the National Assembly and its working bodies. In exercising the representative function of the National
Assembly, initiatives, petitions, complaints and proposals are discussed by MPs in parliamentary groups and
in board meetings within their scope of work, on which the National Assembly and the applicants thereof are
reported to.
Of great importance was also the adoption of the Law on the National Assembly (26 February 2010)
providing for budget autonomy of the NA and establishing a new body, the Collegium (consisting of the
President of the National Assembly, Vice-presidents of the National Assembly and heads of parliamentary
groups in the National Assembly), as well as the adoption of the Rules of Procedure of the National Assem-
bly (28 July 2010) strengthening control mechanisms over the executive.
Concerning the control function of the National Assembly, in accordance with the constitutional prin-
ciple of separation of powers into legislative, executive and judicial, the National Assembly supervises the
work of the Government, security services, the Governor of the National Bank of Serbia, the Ombudsman
and other institutions and bodies in accordance with the law. In exercising its control function, the National
Assembly uses these eleven mechanisms provided in the Constitution of the Republic of Serbia, the Law on
the National Assembly and the Rules of Procedure of the National Assembly:
1. Interpellation regarding the work of the Government or members of the Government;
2. Vote of non-confidence to the Government or a single member of the Government;
3. Posing parliamentary questions to the Government or to the competent Minister;
4. Replying on parliamentary questions in connection with a current subject at least once a month;

15
5. Requesting communications and explanatory notes from the President of the National Assembly,
presidents of the committees, ministers and officials in other state authorities and organisations on
matters within the rights and duties of these officials and within the competency of the authority they
represent;
6. Obligation of the Government to report to the National Assembly on its work and specially on con-
ducting policies, enforcement of laws and other general acts, implementation of development plan
and urban plan and execution of the budget of the Republic of Serbia;
7. Establishment of committees and commissions in order to have overview on state of affairs in a
certain field and determine facts about certain occurrences and events;
8. Discussing reports from state authorities, organisations and bodies;
9. Informing on the work of ministries once in three months. The practice of the competent commit-
tees reporting on the European integration process and on the achieved progress was introduced
even before the obligation of reporting by the Government as stipulated in the Rules;
10. Organizing public hearings on draft laws and state of affairs in certain field. During 2012, many
public hearings were held, while of special importance for the European integration process were
National Assembly on the European Integration Road and The use of European Union Pre-
accession Funds;
11. Acquiring data and information with relevance to the work of committees from the competent min-
istry or other state authority.
Discussions on reports from other state authorities, organisations and bodies deserve special attention.
In accordance with the Rules of Procedure, upon discussing these reports, the competent committee shall
submit a report to the National Assembly with the draft conclusion, i.e. recommendation. The Committee for
the Judiciary, Public Administration and Local Self-government discusses, inter alia, reports on the work of
the following independent public authorities: the Ombudsman, the Anti-Corruption Agency, the Commis-
sioner for Information of Public Importance and Personal Data Protection, the Commissioner for the Protection
of Equality, as well as reports on the work of the High Judicial Council. The regular annual report from the
Commissioner for the Protection of Equality for 2011 and the report on the work of the High Judicial Council for
2011 were discussed by the Committee on 15 November 2012.
Concerning the fields of finance and economy, discussions on reports from the State Audit Institution,
the Commission for Protection of Competition and the Securities Commission are of special importance. The
State Audit Institutions Information on State Audit Reports for 2011 was discussed by the Committee on
Finance, State Budget and Control of Public Spending at its session held on 26 December 2012. In the fields
of education and culture, competent parliamentary committees discuss reports from the National Council for
Higher Education, National Education Council and National Council for Culture.
As regards to the supervision of work in the field of defence, internal affairs and actions of security
services, the competent parliamentary bodies are the Committee for Defence and Internal Affairs and the
Security Services Control Committee. Ministers of defence and internal affairs submit quarterly information
on the work of ministries they head to the Committee for Defence and Internal Affairs. With a view to create
conditions for more efficient and independent work and in accordance with the practice of similar commit-
tees in European Union countries, the Security Services Control Committee decided that sessions dealing
with the reports and other confidential information from security services shall be closed for public. Reports
on work of all three security services were discussed at three closed sessions the Committee held in Novem-
ber 2012.
The National Assembly will continue to use all instruments of executive power control in the coming
period.
The electoral function of the National Assembly has a primarily constitutive character but also certain
implicit elements of control. In exercising this function, the National Assembly, by majority of votes from all
MPs, in the framework of competences established by the Constitution and with a view to exercising its elec-
toral function shall:
1. elect members of the Government, decide on termination of mandate of the Government and minis-
ters. On 27 July 2012 the National Assembly elected this convocation of the Government and voted
on its programme;
2. appoint and dismiss judges of the Serbian Constitutional Court;

16
3. appoint the President of the Supreme Court of Cassation, presidents of the courts, Republic Public
Prosecutor, public prosecutors, judges and deputies of the public prosecutor;
4. appoint and dismiss the Governor of the National Bank of Serbia on proposal from the committee
of the National Assembly competent for finances. The new Governor of the NBS was appointed at
the session of the National Assembly held on 6 August 2012;
5. appoint the Ombudsman, on proposal from the committee competent for constitutional matters. The
Ombudsman was re-appointed at the session of the National Assembly held on 4 August 2012;
6. appoint and dismiss other officials as established by law; (the Commissioner for Information of Pub-
lic Importance and Personal Data Protection, the Commissioner for the Protection of Equality etc.)
The National Assembly exercises its constitutional and legislative functions by adopting legislation
from its scope of competence, by which it fundamentally governs social relations. The National Assembly
adopts and amends the Constitution, ratifies international agreements where the obligation of ratification is
prescribed by law, adopts laws and other general acts from the competence of the Republic. Legislative func-
tion is exercised through the legislative procedure consisting of three stages: 1) legislative initiative i.e. law
proposal, 2) discussion on the draft law and adoption of the law, 3) promulgation of the law.
1. Legislative initiative is held by MPs, who are authorized proposers of a law under the Constitution.
They share this form of legislative power with other authorized proposers of a law under the Con-
stitution, which are: the Government, the Assembly of the Autonomous Province, 30,000 voters, as
well as the Ombudsman and the National Bank of Serbia for draft laws from their respective fields
of competence.
2. Law discussion and adoption is in the exclusive competence of the National Assembly. Laws are
discussed in principle and in detail. In detailed discussion, the National Assembly discusses
amendments submitted to certain provisions of the draft law with a view to their improvement.
3. In the stage of promulgation of the law, the President of the Republic is obliged to adopt a decree
on promulgation of a law or to return the law, accompanied by a written explanatory note, to the
National Assembly for reconsideration. If the National Assembly decides to take another vote and
adopts the law, the President of the Republic is obliged to promulgate the readopted law and if he
does not do so within the timeframe set by the Constitution, the decree is adopted by the President
of the National Assembly.
During 2012, the National Assembly followed the plan for legislative activities envisaged by the Na-
tional Plan for Integration for the period 20082012. In 2012, since the new convocation has been consti-
tuted, a total of 103 laws were adopted (including laws ratifying different international agreements with other
countries and international organisations) out of which a certain number is on the European agenda.
Dynamics and scope of legislative activity in the following period will, as was the case so far, depend
on authorized proposers, notably the Government of the Republic of Serbia.
Committees, which can establish subcommittees, are established for discussing and debating matters
from the competence of the National Assembly, proposing acts as well as for policy matters, enforcement of
laws, other regulations and general acts by the Government, but also for performing other duties defined by
the parliamentary Rules of Procedure. In the previous convocation there were 30 committees, and with the
election of the new convocation the following 20 standing committees were formed:
1. Committee on Constitutional and Legislative Issues
2. Defence and Internal Affairs Committee
3. Foreign Affairs Committee
4. Committee on the Judiciary, Public Administration and Local Self-Government
5. Committee on Human and Minority Rights and Gender Equality
6. Committee on Diaspora and Serbs in the Region
7. Committee on the Economy, Regional development, Trade, Tourism and Energy
8. Committee on Finance, State Budget and Control of Public Spending
9. Agriculture, Forestry and Water Management Committee
10. Committee on Spatial Planning, Transport, Infrastructure and Telecommunications

17
11. Committee on Education, Science, Technological Development and the Information Society
12. Committee on Kosovo-Metohija
13. Culture and Information Committee
14. Committee on Labour, Social Issues, Social Inclusion and Poverty Reduction
15. Health and Family Committee
16. Environmental Protection Committee
17. European Integration Committee
18. Committee on Administrative, Budgetary, Mandate and Immunity Issues
19. Security Services Control Committee
20. Committee on the Rights of the Child
The composition of standing parliamentary committees and distribution of offices of the presidents
and vice-presidents of the committees corresponds to MPs representation of parties in the National Assem-
bly. The largest part of the tasks of parliamentary committees relates to discussing draft laws on agenda for
plenary sessions. In committee sessions draft laws are firstly debated in principle and then in detail. Debate
in detail is carried out per articles of the draft law that are being amended and per amendments that propose
adding new provisions, and this debate may include: committee members, proposer of the law or his repre-
sentative, representative of the Government if it is not acting as proposer or proposer of the amendment, and
every other MP sitting in the committee session. Upon completion of the debate, the committee submits a
report to the National Assembly, which contains the committees opinion and proposals. The committee shall
appoint a rapporteur who shall, if necessary, elaborate the committees report at the session of the National
Assembly.
The importance of the legislative function in the process of aligning internal legal order with the Euro-
pean Union acquis should be emphasized. In that regard, the work of the European Integration Committee is
important and, in accordance with the Rules of Procedure, the Committee has 17 members. The Committee
has the following competences: discussing draft laws and other general acts regarding their compliance with
the regulations of the European Union and the Council of Europe; discussing plans, programmes, reports and
information on the European Union Stabilisation and Association Process; monitoring implementation of the
accession strategy; proposing measures and establishing a general, national agreement on the accession of
Serbia to the European institutions and developing cooperation with parliamentary committees of other coun-
tries and parliamentary institutions of the European Union. Also, the Rules of Procedure of the NA of RS
stipulate that the Committee shall submit opinion on justification of shortened discussion time i.e. fast-track
procedure, on which, under Article 93 of the Rules of Procedure, the decision shall be made by the National
Assembly.
The European Integration Department as well as the Service of the European Integration Committee as
well as offices of other committees and MPs, were established with the aim to be the second instance for super-
vising compliance of laws with European Union regulations. Due to a large number of laws adopted in fast-
track procedure, detailed analysis of draft legislation was not often possible. In this convocation there were a
number of draft laws whose proposers were MPs, so the European Integration Department drafted statements of
compliance and tables of compliance of those draft laws with European Union regulations.
In exchanging experiences and finding best practices in carrying out obligations on the European inte-
gration road, members of the European Integration Committee cooperate with the civil sector, and especially
with administrations of EU Member States and the European Parliament. Cooperation between the National
Assembly and the European Parliament (EP) is primarily carried out through annual interparliamentary meet-
ings of the European Parliament Delegation for relations with Albania, Bosnia and Herzegovina, Serbia,
Montenegro and Kosovo and the delegation of the National Assembly consisting mostly of members of the
European Integration Committee. Through such form of dialogue, the European Parliament Delegation is
informed of Serbian progress regarding political, economic and rule of law criteria, after which a common
statement is adopted. The sixth interparliamentary meeting with the EP was held on 27 and 28 September
2012 in Belgrade, and the seventh will be held in March 2013. After the SAA ratification process has been
completed, interparliamentary meetings will be intensified and the Joint Committee for Stabilisation and As-
sociation will be formed. Joint meetings i.e. sessions of the Joint Committee for Stabilisation and Associa-
tion are and will be another form of joint supervision over the achieved progress in the process.

18
In addition, National Assembly MPs participate in interparliamentary round tables of representatives
of national parliaments of the Western Balkan countries and representatives of line committees of the Euro-
pean Parliament organised by the EP Directorate for Democracy Support (part of the Directorate General for
External Relations). Five round tables were held in 2012: two on the subject of agriculture, two in the field of
environmental protection and one on the state of affairs in human rights with special attention to the status of
women.
Subjects of interparliamentary round tables that will be held in the following period, where representa-
tives of the NA of the Republic of Serbia will participate, will be provided by the EP based on the proposals
from the parliaments of the Western Balkan countries and Turkey.
Of relevance is also the fact that representatives of the National Assembly, since March 2012 i.e. since
the moment Serbia received candidate status, participate as observers in interparliamentary conferences or-
ganized by the country presiding the Council of the European Union. In 2012, representatives of the National
Assembly participated in seven gatherings organized under the Danish and Cypriot presidencies. In accor-
dance with the calendar and calls for participation submitted by the Irish presidency for the first half of 2013,
representatives of the National Assembly of the Republic of Serbia will take part in eight interparliamentary
conferences of the competent committees of EU Member States.
Members of the European Integration Committee and other committees of the National Assembly par-
ticipate in regional activities, strengthening cooperation on all levels in the region, which is one of the most
important political criteria as well as one of the foreign policy priorities of countries in the European integra-
tion process. European Integration Committees in the region act in the form of Conference of the European
integration committees of national parliaments of the countries participating in the Stabilization and As-
sociation Process in South East Europe (COSAP). Representatives of the National Assembly of the Re-
public of Serbia participated in the sixth COSAP conference held on 6 March 2012 in Tirana and have
bilateral relations with national parliaments of other countries in the region. It is also important to mention
that the National Assembly participates in the Parliamentary Dimension of the South East European Coop-
eration Process (PDSEECP) and that during the Serbian presidency in this process, from June 2011 to June
2012, hosted four meetings of the Working Group for Institutionalisation of PDSEECP. With a view to im-
proving regional cooperation during 2013 i.e. during the presidency of Macedonia and Moldova, the partici-
pation of the NA of the Republic of Serbia in this process will continue, like in other regional fora, and at the
same time cooperation with parliaments of neighbouring countries will be continued.
In addition, the National Assembly has its own standing delegations that are actively involved in inter-
national parliamentary structures in the Council of Europe, OSCE, NATO and others, and cooperates with
parliaments of other countries.
In the European integration process the National Assembly achieved exceptional cooperation with the
civil sector and with international organizations missions in Serbia, working on common projects and organ-
ising public hearings on draft laws, primarily at sessions of the European Integration Committee, above all in
connection with special responsibility of the parliament and MPs for approximating European ideas and val-
ues to Serbian citizens.
Bearing in mind the importance of parliamentary democracy, in the following period the National As-
sembly will make efforts to intensify cooperation with the European Parliament, other institutions of the
European Union, parliaments of EU Member States and parliaments of other countries.
Overview of current and planned foreign development aid
In the period January 2013 June 2014, a Twinning project Strengthening Capacities of the National
Assembly in the European Integration Process valued at 1.5 million and financed from IPA I, will be im-
plemented in the National Assembly. The project will be implemented in cooperation with the Greek Parlia-
ment and this is the first project of its kind involving the NA. The second component of this project
Improving the Work of the NA in the Process of Adoption of Laws, especially in the field of harmonising
national legislation with the EU acquis is of significant importance for the National Programme for Adoption
of the acquis. The main objective of the activities that will be realized under this component is strengthening
of the overall capacities of the NA in the field of adoption of the European legislation and monitoring its
proper implementation.
Project Strengthening Control Function and Transparency of the Parliament, signed on 5 September
2012, financed by the Swiss Agency for Development and Cooperation (SDC) and implemented in coopera-
tion with UNDP is aimed at supporting the National Assembly in establishing and strengthening own control

19
mechanisms with special attention to responsible management of the state budget and familiarising citizens
especially on the local level. Total project value is CHF 1,086,004 for a three year period.
Project Strengthening Legislative and Control Mechanisms of the National Assembly, that will be
implemented with support from the Westminster Democracy Foundation, was signed on 5 July 2011. The
project is aimed at improving administrative and research capacities as well as legislative and control func-
tions of the National Assembly.
The project for introducing e-parliament in the work of the National Assembly lasted from November
2010 until October 2012 in the value of 1.8 million (from donors) and will result in the introduction of an
electronic system in the legislative activities of the parliament. Based on the Agreement with the National As-
sembly, the OSCE Mission in Serbia prepared the strategy for the introduction of e-parliament while the Swiss
Agency for Development and Cooperation ensured the required funds for its implementation. The largest part
of the project value was spent for public procurement of the equipment and software while the rest will be used
for trainings for MPs and parliamentary services and for promotion and management of the project.
Project Strengthening Democracy in the Security Sector is part of a broader programme of parlia-
mentary support under the Memorandum on Cooperation between the National Assembly and the OSCE
Mission in Serbia. The project follows up on previous experiences acquired in similar activities with the aim
to intensify parliamentary control of executive power, particularly in the domain of security sector.
The Memorandum of Understanding between the Legislative Committee of the National Assembly of
the Republic of Serbia and the OSCE Office for Democratic Institutions and Human rights (OSCE/ODIHR)
was signed in Warsaw on 17 may 2011. The result of this cooperation is a document titled Assessment of
the Legislative Process and the Process of Adoption of Regulations in the Republic of Serbia, presented in
the National Assembly on 7 February 2012.
Project Supporting the Implementation of Legal Reforms in Serbia, Phase 1 (2011-2013) with GIZ
foundation was signed on 8 June 2011. The result of the successful cooperation so far is the Survey on Im-
provement of the Legislative Process in Serbia, presented in the National Assembly on 25 September 2012
to MPs, representatives of the executive and the judiciary, civil society and the academic and business com-
munities.
The Memorandum of Understanding, signed between the National Assembly and USAID (Separation
of Powers Programme) on 17 March 2009, envisaged strengthening capacities of the National Assembly
with view to improving development of organisational capacities, achieving transparency and building up
financial independency. This project should provide support to the National Assembly in strengthening ca-
pacities to plan, manage and control spending of parliamentary budget.
The Memorandum of Cooperation between the National Assembly and the National Democratic In-
stitute (NDI) provides for planning and defining activities of the National Assembly under pro-
grammes aimed at bringing the Parliament closer to citizens. Opening MPs offices across Serbia began
in 2010, with financial support from NDI and continued in 2011 and 2012, with a view to strengthening the
representative role of the parliament, and an internship programme in the National Assembly service was
envisaged for students in final years of their studies.
The Multi-user IPA project 2013 Parliamentary Dimension, where Western Balkans countries and
Turkey participate together and whose value is 1.5 million, will start during 2013 and is expected to be
finalised during 2016. The project goal is to improve exchange of experiences and good practice as well as
cooperation between parliaments in the region, especially in the domain of the legislative process and har-
monisation of domestic legislation with the EU acquis, as well as better communication between parlia-
ments, citizens and the media in the field of European integration.

1.1.3. Government
The Government is the holder of the executive power in the Republic of Serbia.
Pursuant to the Constitution of the Republic of Serbia, the Government shall:
1. establish and pursue policy,
2. execute laws and other general acts of the National Assembly,
3. adopt regulations and other general acts for the purpose of enforcement of laws,
4. propose laws and general acts to the National Assembly and give its opinion on those laws and
general acts, when another mover proposes them,

20
5. direct and adjust the work of ministries and other state administration bodies and
6. performs supervision of their work
7. administer other affairs stipulated by the Constitution and law.
The Government shall account to the National Assembly for the policy of the Republic of Serbia, for
enforcement of laws and other general acts of the National Assembly, as well as for the work of the state
administration bodies.
The Government shall consist of the Prime Minister, one or more Vice Presidents and ministers.
The Prime Minister shall manage and direct the work of the Government, take care of coordinated po-
litical activities of the Government, coordinate the work of members of the Government and represent the
Government.
For their work and the conditions within the scope of the respective ministry, the ministers are ac-
countable to the Prime Minister, to the Government, and the National Assembly.
A candidate for Prime Minister shall be proposed to the National Assembly by the President of the
Republic, after he or she considers the opinions of representatives of elected election lists.
The candidate for Prime Minister shall present the Governments Programme to the National Assem-
bly and propose its composition.
The Government shall be elected if the majority of the total number of MPs vote in favour of its elec-
tion.
The term of office of the Government shall last until the expiry of the term of office of the National
Assembly which elected it. The term of office of the Government shall commence on the day of taking an
oath before the National Assembly.
The term of office of the Government shall end before the period of time for which it has been elected, by
vote of non-confidence, dissolution of the National Assembly, resignation of the President of the Republic and in
other cases provided for by the Constitution.
The Government whose term of office has expired may only perform certain current and immediate af-
fairs stipulated by the law, until the election of the new Government.
The term of office of a member of the Government shall expire before the expiry of the period of time
for which he or she has been elected, by accepting his/her resignation, by the vote of non-confidence in the
National Assembly and dismissal by the National Assembly, upon proposal of the Prime Minister.
The Law on Government (Official Gazette of RS No 55/05, 71/05 corrigendum, 101/07, 65/08,
16/11, 68/12 CC and 72/12) established that the Government is autonomous within its competences. The
Government shall be accountable to the National Assembly for conducting the policy of the Republic of Ser-
bia, for execution of laws and other general acts of the National Assembly, for the state of affairs in all areas
within its competence and for the work of state administration bodies and holders of public powers on the
Republic level.
In the field of supervision of the constitutionality and legality, the Government is obliged to stall the
enforcement of general acts of a municipality, city or the City of Belgrade if it considers it non-compliant
with the Constitution or the law, by a decision, which enters into force upon its publication in the Official
Gazette of the Republic of Serbia. The decision on stallment ceases to be effective if the Government fails
to initiate the procedure for assessment of constitutionality and legality within five days from the day of its
publication.
The Government shall consist of the Prime Minister, one or more Vice Presidents and line ministers.
The Government may have ministers without portfolio. The number of Vice Presidents of the Government
and ministers without portfolio shall be determined by the National Assembly upon each election of the
Government, at the proposal of the candidate for Prime Minister. The number of line ministries is determined
by the Law on Ministries.
Members of the Government may not hold another public office in a state authority, authority of the
Autonomous Province, city authority and City of Belgrade authority, perform a duty that is, according to
law, incompatible with the duty of member of the Government, nor give rise to the possibility of conflict of
public and private interest. A member of the Government must observe all legislation regulating conflict of
interest in performing public function.
The Prime Minister shall lead and direct the Government, ensure the unity of political action of the
Government, harmonise the work of members of Government, represent the Government and convene and
conduct its sessions. The Prime Minister may also be minister.

21
The Prime Minister may give other members of Government, state secretaries and directors of special
organisations and services of the Government, mandatory instructions and special tasks, pursuant to the
Government programme and policy. The Prime Minister shall adopt decisions and decrees.
The Prime Minister may establish a council for economic development and a council for state authori-
ties and public services.
The Vice President of the Government shall direct and harmonise the work of state administration au-
thorities in the areas determined by the Prime Minister. The Prime Minister may empower the Vice President
of the Government to manage a project from the scope of work of several state administration authorities.
The Vice President of the Government may also be minister.
The Prime Minister shall allocate one Vice President of the Government as the First Vice President of
the Government who will replace him or her during absence or incapacity with all powers of Prime Minister
except for power of calling an election or dismissal of a member of Government. The First Vice President of
the Government shall support the Prime Minister in leading and directing the Government, ensuring the unity
of political action of the Government and harmonisation the work of members of Government.
A minister may submit proposals to the Government for regulating issues from the competence of the
Government and the National Assembly and request that the Government adopt a position on an issue from
his or her competence. A minister shall be obliged to inform the Government on all relevant issues for the
conduct of policy and decision-making of the Government. A minister shall be accountable for the imple-
mentation of Government programmes and policy, for decisions and measures he or she has passed or failed
to pass or take and for the implementation of mandatory instructions and tasks entrusted to him or her by the
Prime Minister.
The Government shall pass decisions at sessions, by majority vote of all its members. In case the Gov-
ernment has an even number of members, the Governments decision shall be passed if at least half of all
members votes for it provided that the Prime Minister voted for the decision.
The Government shall propose to the National Assembly laws and other general acts, budget of the
Republic of Serbia, give opinions on draft laws it had not proposed itself, and submit annual report on its
work.
The Government shall be obliged to adopt a position on the proposal of the National Assembly that
has been submitted on an issue from the Governments competence. The Government may propose to the
National Assembly to discuss an issue from the Governments competence and adopt a position thereon.
The Government shall have a General Secretary of the Government, who shall be appointed and dis-
missed by the Government at the proposal of the Prime Minister. The office of the Secretary General of the
Government shall be terminated with the appointment of a new Secretary General of the Government, by
resignation or dismissal.

1.1.4. Public Administration


Overview
Public administration is a part of the executive power of the Republic of Serbia performing adminis-
trative work within the rights and duties of the Republic of Serbia. Pursuant to the Constitution, it shall be
autonomous, obliged by the Constitution and law and for its work it shall be accountable to the Government.
Having in mind the importance of public administration, the Government has set reform in this field, based
on generally accepted principles of European administrative law, as one of the priorities in its work. As a
basic strategic document in the field of public administration, in November 2004, the Government adopted
the Strategy for Public Administration Reform in the Republic of Serbia. Activities in the implementa-
tion of this strategic document were defined in the Action Plan for Implementation of Public Administra-
tion Reform which is the integral part of the Strategy. So far, the Government adopted two Action Plans
first for the period 2004-2008 and second for 2009-2012.
The Government established the institutional framework for implementation of the public administra-
tion reform. In that regard, the Government conferred strategic management of the reform to the Council for
Public Administration Reform. The Government adopted the Decision on the Establishment of the Council
for Public Administration Reform (6 May 2009) as the central strategic government authority for public ad-
ministration reform chaired by the Prime Minister, laying down in detail tasks for promoting and monitoring
the implementation of the Strategy.

22
On operational level, managing the reforms is conferred to the ministry competent for the operation of
the public administration. Considering that the public administration reform is a continuing process, the min-
istry competent for the operation of the public administration started with preparation for drafting the Action
Plan for Implementation of Public Administration Reform in the Republic of Serbia for the next four years.
In consulting prominent expert consultants, a conclusion was drawn that for the future public administration
reform process it would be more suitable to adopt a new, modernized strategy for public administration with
an action plan, that will cover broader field known as public administration state administration, local self-
government and other forms of exercising public authority, while keeping continuity with the previously
adopted principles public administration is based on.
Creating a professional public administration is the key condition for success of the public administra-
tion reform, and, having in mind the absence of a systemic and suitable approach in resolving the issues of
professional development of civil servants, in July 2011 the Government adopted the Strategy for Profes-
sional Development of Civil Servants in the Republic of Serbia for 20112013 with Action Plan for its
implementation, that provided basic guidelines for establishing a new integrated, comprehensive and sus-
tainable system for professional development of civil servants, completely in function of achieving the goals
of the public administration reform. Other significant reason for introducing the new system for professional
development is the establishment of standards of quality and contents of the professional development pro-
grammes for civil servants, general as well as individual.
Legislative and institutional framework
- Legal framework for the organisation and functioning of the public administration in Serbia is
comprised of a set of laws, adopted since 2004 to date, in accordance with the Strategy for Public
Administration Reform:
- Law on Government (Official Gazette of RS No 55/05, 71/05 corrigendum, 101/07, 65/08, 16/11,
68/12, 72/12 and 74/12 CC);
- Law on Public Administration (Official Gazette of RS No 79/05, 101/07 and 87/11);
- Law on Public Agencies (Official Gazette of RS, No 18/05 and 81/05 corrigendum);
- Law on Civil Servants (Official Gazette of RS No 79/05, 81/05 corrigendum, 83/05 corrigen-
dum, 64/07 and 67/07 corrigendum, 116/08 and 104/09);
- Law on Salaries of Civil Servants and Other Employees (Official Gazette of RS No 62/06, 63/06
corrigendum and 115/06 corrigendum, 101/07 and 99/10);
- Law on Electronic Signature (Official Gazette of RS No 135/04);
- Law on the Ombudsman (Official Gazette of RS No 79/05 and 54/07)
- Law on Free Access to Information of Public Importance (Official Gazette of RS No 120/04,
54/07, 104/09 and 36/10).
- Law on Prevention of Conflict of Interest in Performing Public Functions (Official Gazette of RS
No 43/04);
- Law on Electronic Document (Official Gazette of RS No 51/09);
- Law on Electronic Communication (Official Gazette of RS No 44/10);
Aside from the abovementioned laws, the Law on Ministries (Official Gazette of RS No 72/12) estab-
lished ministries and special organisations and regulated their scope of work. Also, in cases where the law
explicitly stipulates, by-laws elaborate certain provisions of the laws listed above, in order to ensure their
enforcement.
Public Administration of the Republic of Serbia is governed by the Law on Public Administration.
State administration bodies of the Republic of Serbia are:
I Ministries, with administrative bodies in their composition:
1. Ministry of Interior
2. Ministry of Finance and Economy
- Customs Administration
- Tax Administration

23
- Directorate of Measures and Precious Metals
- Treasury Administration
- Public Debt Administration
- Tobacco Administration
- Administration for the Prevention of Money Laundering
- Free Economic Zones Administration
3. Ministry of Foreign Affairs
4. Ministry of Defence
- Defence Inspectorate
- Military Security Agency
- Military Intelligence Agency
5. Ministry of Regional Development and Local Self-government
6. Ministry of Transport
- Authority for Determination of the Seaworthiness
- Authority for transport of dangerous goods
7. Ministry of Civil Engineering and Urbanism
8. Ministry of Justice and Public Administration
- Administration for the Enforcement of Penal Sanctions
- Administrative Inspectorate
- Directorate for Management of Seized Assets
9. Ministry of Agriculture, Forestry and Water Management
- General Inspectorate for Agriculture, Forestry and Water Management
- Veterinary Administration
- Plant Protection Administration
- Republic Waters Directorate
- Forest Administration
- Directorate for Agrarian Payments
- National Reference Laboratories Directorate
- Agricultural land administration
10. Ministry of Education, Science and Technological Development
11. Ministry of Health
- Department of Biomedicine
12. Ministry of Energy, Development and Environmental Protection
- Environmental Protection Agency;
13. Ministry of Culture and Information
14. Ministry of Natural Resources, Mining and Spatial Planning
15. Ministry of Labour, Employment and Social Policy
- Gender Equality Administration
- Labour Inspectorate
- Administration for Health and Safety at Work
16. Ministry of Youth and Sports
17. Ministry of Foreign and Internal Trade and Telecommunications
- Digital Agenda Administration

24
II Special organisations:
1. Republic Secretariat for Legislation
2. Republic Directorate for Commodity Reserves
3. Statistical Office of the Republic of Serbia
4. Republic Hydrometeorological Service of Serbia
5. Republic Geodetic Institute
6. Republic Property Directorate of The Republic of Serbia
7. Mine Action Centre
8. Intellectual Property Office
9. Social Insurance Bureau
10. Directorate for Waterways
11. Public Procurement Office
12. Republic Seismological Institute
13. Commissariat for Refugees and Migration
14. Security-information Agency
15. Republic Directorate for Peaceful Settlement of Labour Disputes
16. Railways Directorate
Although, strictly speaking, they are not part of state administration, Government services are part of
the state administration system and the Government establishes them in accordance with the Law on Gov-
ernment and the Regulation on Government Services (Official Gazette of RS No 75/05)
The Government services are:
1. General Secretariat of the Government
2. Media Cooperation Bureau
3. Serbian European Integration Office
4. Office of Coordination Body of the Government of the Republic of Serbia for the Municipalities of
Presevo, Bujanovac and Medvedja
5. Human Resource Management Service
6. Government Air Service
7. Office of the National Council for Cooperation with International Tribunal for prosecution of per-
sons responsible for serious violations of International Humanitarian Law Committed on the terri-
tory of former Yugoslavia since 1991
8. Sustainable Development Office for Underdeveloped Areas
9. Office of the Council for National Security and Protection of Classified Data
10. Office for Cooperation With Civil Society
11. Office for Regulatory Reform and Regulatory Impact Assessment
12. Office for Expert and Operational Activities in Negotiating Process
13. Office for Audit of the EU Funds Management System
14. Office for Kosovo and Metohija
15. Office for Human and Minority Rights
16. Office for Cooperation with Churches and Religious Communities
17. Office for Cooperation with Diaspora and Serbs in the Region
Internal organisation and systematization of state administration bodies (and Government services), as
well as the exact number and structure of the employees, are prescribed by Rulebooks on Internal Organisa-
tion and Systematisation of Job Positions in each body. These Rulebooks must be based on principles set in
the Regulation on Principles of Internal Organisation and Systematisation of Job Positions in Ministries,
Special Organisations and Government Services (Official Gazette of RS No 81/07 consolidated version,
69/08 and 98/12) and they require the Governments consent. Proposal of every such act is previously sub-

25
mitted for the opinion to the Ministry of Justice and Public Administration, Ministry of Finance and Econ-
omy, and the Human Resources Management Service, in order to ensure observance of relevant legal provi-
sions, principles of the organisation and rational distribution of work and resources.
The Law on Civil Servants regulated in a comprehensive manner the rights and duties of civil ser-
vants in the Republic of Serbia, in accordance with principles of the European Administrative Space. In ac-
cordance with the Public Administration Reform Strategy in the Republic of Serbia, a narrow concept of a
civil servant was adopted, where civil servants are only employees in the central government bodies and not
those in autonomous province or local self-government bodies.
Priorities for 2013 with regard to harmonisation of legislation
The Annual Work Plan of the Government for 2013 envisaged the adoption of draft Law on Employ-
ees in Units of Local Self-government for the second quarter of 2013. The draft law shall establish rights,
responsibilities and liabilities of employees in local self-government units, based on principles of the public
servant system and observing the principles of professionalization and depoliticising.
Considering that the Law on Ministries (Official Gazette of RS No 72/12) established new ministries,
special organisations and Government services that required the adoption of the Rulebook on Internal Or-
ganisation and Systematisation of Job Positions that can be expected in the beginning of 2013.
The Law on Salaries of Civil Servants and Other Employees has been adopted. By applying the
principle of salary decompression, the larger differences in coefficients for different titles of civil servants
were achieved, thus creating conditions for a system of advancement (through occupational titles vertically
and through salary grades without changing the title horizontally), which offers additional motivation for
employees to express excellence in their work. On 11 December 2009, the National Assembly of the Repub-
lic of Serbia adopted three laws based on which rationalisation in state and local administration will be car-
ried out:
- Law on Amendments to the Law on Civil Servants (Official Gazette of RS No 104/09)
- Law on Determining the Maximum Number of Employees in the Administration of the Republic
(Official Gazette of RS No 104/09)
- Law on Determining the Maximum Number of Employees in Local Administration (Official Ga-
zette of RS No 104/09)
Salaries in the public sector
I Civil Servants and Other Employees
The law regulating salaries in state authorities is the Law on Salaries of Public Servants and State Em-
ployees (Official Gazette of RS No 62/06, 115/06 corrigendum, 101/07 and 99/10).
In accordance with the Law on Salaries of Civil Servants and Other Employees, the Regulation on Re-
imbursements and Financial Arrangements of Civil Servants and Other Employees (Official Gazette of RS
No 86/07 and 93/07) is applied to civil servants and other employees, regulating the conditions under which
civil servants and other employees acquire the right to reimbursement of expenses occurred in connection
with their work in the state authority, the manner of compensation and the amount of compensation (for ex-
ample, expenses relating to: transport to/from work, business trip in the country or abroad, relocation abroad,
field work and stay, temporary or permanent secondment to another workplace), as well as the amount of
severance payment.
II President of the Republic, elected persons in the Government and National Assembly, State Secretaries
Acts regulating salaries for these posts are the Law on Salaries in State Authorities and Public Services
(Official Gazette of RS No 34/01, 62/06 other law, 63/06 corrigendum, 116/08 other law, 92/11 and
99/11 other law) and the Regulation on Coefficients for Calculation and Payment of Salaries of Elected and
Appointed Persons and Employees in State Authorities (Official Gazette of RS No 44/08 and 2/12).
For elected and appointed persons in state authorities who are not in posts, the Regulation on Compen-
sations and other Payments for Elected and Appointed Persons in State Authorities also applies (Official Ga-
zette of Republic of Serbia No 115/07 and 31/08), regulating their rights to reimbursement of expenses
occurred in connection with their work in the state authority, or other payments, the manner of exercising the
right and the amount of reimbursement and other payments.

26
III Elected persons in the judiciary, Commissioner for the Protection of Equality, Commissioner for
Information of Public Importance and Personal Data Protection, Ombudsman, Anti-Corruption Agency,
State Audit Institution, Serbian Armed Forces, Ministry of Interior, Security Information Agency,
diplomatic and consular missions, Administration for the Enforcement of Penal Sanctions, Tax
Administration
Salaries are determined based on special laws that, due to the specific nature of the work, determine
salary calculation in a different manner.
IV Public services (education, cultural institutions, social welfare, health services and organizations for
mandatory social insurance and other public services)
Acts regulating salaries for these categories are the Law on Salaries in State Authorities and Public
Services (Official Gazette of RS No 34/01, 62/06 other law, 63/06 corrigendum, 116/08 other law,
92/11 and 99/11 other law) and the Regulation on Coefficients for Calculation and Payment of Salaries of
Employees in State Authorities (Official Gazette of RS No 44/01,...100/11 and 11/12);
V Local self-government (elected, appointed and employees)
Acts regulating salaries for these categories are the Law on Salaries in State Authorities and Public
Services (Official Gazette of RS No 34/01, 62/06 other law, 63/06 corrigendum, 116/08 other law,
92/11 and 99/11 other law) and the Regulation on Coefficients for Calculation and Payment of Salaries of
Elected and Appointed Persons and Employees in State Authorities (Official Gazette of RS No 44/08 and
2/12).
The adoption of Draft Law on Labour Relations in Local Self-government Units is currently underway
and it will cover all specifics of the work on the level of local self-government, and will, in the upcoming
period, become the basis for the adoption of a law regulating salaries in local self-government units in a bet-
ter, more systematic and more transparent manner.
VI Public companies and public agencies
Regulations on salaries and employments applicable to civil servants and other employees and em-
ployees in public services (educational workers, health workers) do not apply and salaries are determined
based on the Law on Labour (Official Gazette of RS No 24/05, 61/05 and 54/09) and own acts (rulebooks,
collective agreements, employment contracts).
In order to ensure protection of citizens rights in their relation to state authorities, the Law on the
Ombudsman was adopted. To exercise and protect public interest in information and exercise free democ-
ratic movement and open society, in late 2004 the Law on Free Access to Information of Public Interest
was adopted, as was the Law on Personal Data Protection in late 2008. Since 1 January 2009, the Commis-
sioner is competent for the field of personal data protection. In December 2011, the National Assembly re-
newed the mandate of the Commissioner for Information of Public Importance and Personal Data Protection.
On 11 December 2009, the National Assembly adopted the Law amending the Law on Free Access to In-
formation that, inter alia, provides for inspection monitoring on the implementation of this law, conducted
by the ministry competent for affairs of the administration through the Administrative Inspection.
Following the adoption of this law, the Commissioner for Information of Public Importance and Per-
sonal Data Protection adopted a new Instruction for Publishing Information Memorandums on the Work of
State Authorities (Official Gazette of RS No 68/10).
Introducing electronic business and electronic signature into the work of state administration bodies
hold special importance for modernizing state administration. The Law on Electronic Signatures, adopted
in 2004, and the Law on Electronic Documents from 2009 regulate the use of electronic signatures in legal
transactions and other legal activities, business affairs as well as rights, obligations and liabilities regarding
electronic certificates. The Law on Electronic Communications adopted in 2010 regulates, inter alia, pro-
tection of user rights in the field of electronic communications, security and integrity of electronic communi-
cations networks and services and confidentiality of electronic communications, and other issues important
for functioning and development of electronic communications in the Republic of Serbia. The Strategy for
Development of E-Government in the Republic of Serbia for the period 2009-2013 (Official Gazette of RS
No 83/09 and 5/10) is based on adopted government commitments to the development of information society
and public administration reform, and one of the priorities is the reform of procedures that should include
innovating legislation governing office management and treatment of archival records. Having in mind stra-
tegic commitments of the Government and activities envisaged for the introduction of information technolo-
gies into public administration bodies for the establishment of a legal framework for the application of

27
electronic document in communication between state administration bodies, the Government adopted the
Regulation on Electronic Office Management, regulating treatment of electronic document in office man-
agement in public administration bodies (Official Gazette of RS No 40/10). In order to enable the enforce-
ment of this Regulation, the minister competent for the operation of public administration adopted the
Instruction on Electronic Office Management (Official Gazette of RS No 102/10) prescribing technical con-
ditions that must be met by the information system for office management, as well as by electronic docu-
ments used in the information system.
EUPAN informal network of the Directors General responsible for public administration
After acquiring candidate status on 1 March 2012, the Republic of Serbia became entitled to partici-
pate, in observer capacity, in the work of EUPAN (European Public Administration Network) and accord-
ingly, the Ministry of Justice and Public Administration had its representative at the 59th meeting of Directors
General held during the Cypriot presidency in Nicosia on 5 and 6 December 2012. EUPAN is an informal
network of the Directors General responsible for public administration in EU Member States, the European
Commission and observing countries. Considering that the public administration reform is one of the key
priorities of the Government and the Ministry of Justice and Public Administration, we expect, in accordance
with generally accepted principles of European administrative law and through the involvement into the op-
eration of EUPAN, an improved performance, competitiveness and quality of our public administration by
exchanging opinions, experiences and good practice between member countries, the European Commission,
observing countries, and other organisations.
Priorities for 2013 with regard to harmonisation of legislation:
- Law on General Administrative Procedure adoption of the draft law is expected in August 2013
- Law amending the Law on Ombudsman adoption of draft law is expected in June 2013
- Amendments to the Law on Civil Servants for the alignment with the Strategy for Professional
Development of Civil Servants for 20112013 (Official Gazette of RS No 56/2011) and im-
provement of certain provisions of the law relating to appointments of public servants to posts, in
order to fulfil, as much as possible, the principle of professionalization envisaged by the law.
Adoption of the draft law is expected in June 2013
- Law amending the Law on National Minority Councils adoption of the draft law is expected in
August 2013
- Draft Strategy on Public Administration Reform in the Republic of Serbia is expected in August 2013
Administrative capacities of the Ministry of Justice and Public Administration
Overview
According to the Rulebook on Internal Organisation and Systematisation of Job Positions in the Minis-
try of Justice and Public Administration, no 121-2-8/2012-39 from 1 October 2012, a total of 212 jobs were
systematised, with 267 civil servants and 23 other employees (out of these numbers, in the Cabinet of the
Minister 6 jobs were systematised, with 3 civil servants and 5 other employees).
In December 2012, in the Ministry of Justice and Public Administration, a total of 153 persons were
employed for a non-fixed term, from which 8 officials, 134 are civil servants and 11 other employees. The
qualification structure of the employees is as follows: with university education 117 employees, 13 are
with college education and 23 employees with secondary education. One civil servant intern with college
education is employed for a fixed term.
The Directorate for Management of Seized Assets, as a constituent body within the Ministry, employs
a total of 26 persons, where 1 is an official, 20 are civil servants and 5 other employees. 17 employees are
with university education, with college education there are 2 and with secondary education 5 persons. One
civil servant intern with university education is employed for a fixed term.
The Administrative Inspectorate, as a constituent body within the Ministry, employs a total of 26 per-
sons, where 3 are officials and 23 are civil servants. University degrees are held by 25 employees and one
person is with secondary education.

28
Plans for 2013
According to projections, the planned number of employees in 2013 in the Ministry of Justice and
Public Administration is 210, where 8 persons are officials, 175 are civil servants, 14 civil servants interns
and 13 other employees.
In the Directorate for Management of Seized Assets, a total of 32 employees were planned for 2013,
where 3 are officials, 24 civil servants and 5 other employees.
The Administrative Inspectorate planned a total of 40 employees in 2013, 3 officials and 37 civil ser-
vants.
Considering that the lack of executives, in some organisational units, partly limited regular work per-
formance under their scope, along with the fact that in 2012 there were no opened vacancies, the Ministry
was planned to begin with vacancy filling procedure in 2013.
It was envisaged that the largest number of employees in the ministry and its constituent bodies hold
university education, a total of 231 persons (217 public servants and 14 interns) while with a college educa-
tion it was planned for a total of 20 persons and 31 employees with a secondary education.
Measures planned for the period 2014-2016
Priorities in public administration for 2014:
- Amendments to the Regulation on Establishment of HRMS (Human Resources Management Of-
fice) i.e. harmonization with the provisions of the Law on Amendments to the Law on Public Ser-
vants governing professional development of civil servants
- Adoption of a bylaw governing the procedure for determining professional development pro-
gramme
- Regarding the implementation of the Strategy for Professional Development, besides amending
legislation, required activities, are organization of preparation, establishment and monitoring im-
plementation of a general professional development programme under the ministry competent for
public administration, as well as and training employees for the organisational work on preparation,
establishment and monitoring implementation of a general professional development programme
- Analysis of the Law on Administrative Disputes regarding new provisions of the law with a sup-
port from a working group and proposal of amendments to the existing Law on Administrative
Disputes in the context of new arrangements of the law.
- Working on the reform of inspection monitoring and preparing text of draft law on inspection
monitoring, that should regulate the competence, manner of operation and organisation of the in-
spection.
- Priorities in public administration for 2015:
- The Law Amending the Law on Administrative Disputes
- Law on Inspection Monitoring
- Law on Referendum and Peoples Initiative
After adoption of envisaged legislation in the field of the employee system, public administration but
also decentralization, public administration reform in Serbia will continue with activities that should allow
for full application of the basic principles defined in the Public Administration Reform Strategy through a
number of projects.
Overview of current and planned foreign development aid
Ministrys projects in the field of Public Administration financed from the EU funds
Project Support to Public Administration Reform started in May 2011 and will be finished in May
2013. Total project value is 1.7 million financed from the European Union donation (IPA 2010). Project
should offer contribution to improvement of efficiency, effectiveness and liability of public administration of
the Republic of Serbia in accordance with the Public Administration Reform Strategy in the Republic of
Serbia and in accordance with the requirements of the European integration process. Project covers activities
relating to the preparation of the Public Administration Reform Strategy, improvement of strategic manage-
ment, rationalization of public administration and securing consistency of professional development of pub-
lic servants.

29
Project Supporting further development of system for professional development of public servants
represents a constituent part of IPA programme for 2012 (the European Union donation). Implementation of
the project should start in the second half of 2013 and it was planned to last for three years. Project should
provide contribution to the establishment of effective and efficient citizen-oriented public administration
compliant with the principles from the Public Administration Reform Strategy and the European Adminis-
trative Space Project should cover activities relating to further development of the system for professional
development of public servants as a part of the system for human resources management in line with the
Strategy for Professional Development of Civil Servants in the Republic of Serbia and Action Plan for
its implementation.
Project Supporting further development of e-government represents a constituent part of IPA pro-
gramme for 2012 (the European Union donation). Implementation of the project should start in the second
half of 2013 and it was planned to last for three years. Project should provide contribution to establishment
of an effective and efficient citizen-oriented public administration compliant with the principles from the
Public Administration Reform Strategy and the European Administrative Space Project should cover ac-
tivities relating to further development of e-government through development of electronic services on cen-
tral and local level, exchange of data between state authorities, national registers and ICT infrastructure of
the Government.
Ministrys projects in the field of Public Administration financed from bilateral assistance programmes
Project Support to Public Administration Reform in the Republic of Serbia in the period from 2010
to 2013 started in January 2011 and it was planned to last until January 2014. Total project value is 2.1
million financed from the Kingdom of Sweden donation (SIDA). Project should provide contribution to fur-
ther improvement of rule of law and liabilities, transparency, effectiveness and efficiency of Public Admini-
stration in the Republic of Serbia. Project includes activities relating to the improvement of organizational
structure and increased efficiency of the state administration bodies as well as timely implementation of in-
dividual activities regarding Public Administration Reform.
Support to elaboration of draft law on employees in local government units is implemented under pro-
gramme Strengthening local self-government in Serbia, phase II financed from the EU funds and imple-
mented by the Council of Europe.
Administrative Inspectorate - Administrative Inspection
Overview
The Law on Administrative Inspection adopted on 17 November 2011 and published in Official Ga-
zette of the Republic of Serbia No 87 from 27 November 2011 governs organization, operation and manner
of operation of administrative inspection, rights, duties and responsibilities of administrative inspectors and
other matters of importance for the work of administrative inspection.
Administrative Inspection represents a form of internal monitoring of law enforcement and other legis-
lation and actions of state administration bodies, court services, public prosecutors, Public Attorney's Office,
the National Assembly services, President of the Republic, Government, Constitutional Court and services of
the bodies whose members are elected in the National Assembly as well as authorities of territorial autonomy
and local government units in performing delegated work of public administration and other holders of pub-
lic authority whose contents, limits and authorisations are established by this and particular laws.
Measures for implementation of priorities in 2013
In April 2012, in accordance with the Ombudsmans recommendation on ensuring a proper use of mi-
norities languages, Administrative Inspection included in its Annual Work Plan implementation of inspec-
tion monitoring over the enforcement of the Law on Official Use of Language and Script. Planned
monitoring measure of the administrative inspection will be carried out in local government units including
Prijepolje, Sjenica, Novi Pazar and Tutin and will be realized by the end of the second quarter of 2013.
Control role of the National Assembly independent regulatory bodies
Rules of Procedure of the National Assembly adopted by the National Assembly in 2010 regulated the
procedure for exercising its control function. Monitoring the work of state authorities, National Assembly
carries out by discussing reports they submit to the National Assembly pursuant to the law. Rules of Proce-
dure of the National Assembly govern the procedure for discussing these reports in the session of a compe-
tent committee and in the National Assembly session. It was established that after competent committee

30
discuss reports it should submit report to the National Assembly as well as a draft conclusion and/or recom-
mendation.
In 2011 the National Assembly for the first time discussed annual reports from independent regulatory
bodies in accordance with prescribed procedure and after the discussion adopted conclusions regarding the
reports proposed by the Committee for Judiciary, Public Administration and Local Government.
Committee for Judiciary, Public Administration and Local Government pursuant to scope established by
the Rules of Procedure of the National Assembly discusses reports on the work of independent regulatory bod-
ies: Ombudsman, Commissioner for Free Access to Public Information and Personal Data Protection, Anti-
corruption Agency and the Commissioner for the Protection of Equality . Submission of the reports is the obli-
gation of these independent regulatory bodies pursuant to the law governing their operation.
In sessions held on 31 October and 15 November 2012, the Committee discussed annual reports on the
work of independent regulatory bodies for 2011 and in accordance with article 238 of the Rules of Procedure
of the National Assembly (Official Gazette of RS, No 20/12 - consolidated) submitted report to the National
Assembly with draft conclusions.
In draft conclusions submitted to the National Assembly, the Committee concluded that the reports on
the work of independent regulatory bodies provided a comprehensive overview of reporting fields and the work
of independent regulatory bodies itself. The Committee ordered to the National Assembly to support efforts and
activities of independent regulatory bodies in exercising and protection of human and minority rights as well as
strengthening the integrity and responsibilities of the institutions and officials as well as employees in public
administration regarding the fight against corruption. In addition, the Committee proposed that the National
Assembly commit the Government to create legal framework for discussing proposals and initiatives submitted
by independent regulatory bodies in procedure of adoption of laws and other legislation as well as execution of
binding decisions made by the bodies in performing their competences. The Committee, also, proposed to the
National Assembly to commit the Government to create conditions for full independence in the work of these
bodies by ensuring relevant premises and other material conditions in order to execute their authorizations in
protection and improvement of human rights and freedoms in this field in full capacity. Pursuant to proposed
conclusions, in procedure of law adoption, the National Assembly committed to provide harmonized legislation
adopted with a view to create unified and consistent legal system and to contribute to reach the level of citizens
rights guaranteed by the Constitution, law and international standards. National Assembly also committed to
observe recommendations from the reports of independent regulatory bodies in performing its legislative, con-
trol and electoral function.
Local Self-Government
Overview
Local government system is governed by the Law on Local Self-Government (Official Gazette of Re-
public of Serbia, No 129/07) and the Law on Local Elections (Official Gazette of RS, No 129/07, 34/10 and
54/11);
System and organization of local government are directly dependant on the Law on Territorial Organi-
sation of the Republic of Serbia (Official Gazette of Republic of Serbia, No 129/07) and he Law on the Capi-
tal City (Official Gazette of Republic of Serbia, No 129/07)
The Constitution of the Republic of Serbia is the legal ground for functioning and improvement of the
local self-government system (new system and organization of authority are established: assembly is the
highest body of the local self-government unit; municipality assembly decides on election of executive au-
thorities in municipality).
Valid legislative framework
Law on Local Self-Government (aligned with new Constitution and the European Charter on Local
Government) provides for more efficient exercise of constitutionally guaranteed citizens' right to local self-
government, stability and responsibility of local authorities as well as depoliticising and professionalization
of the administrative bodies.
- Broadly autonomous scope of work of local government units (created conditions for strengthening
decentralisation process),
- Direct election of executive authorities (municipality president i.e. mayor and municipal or city
council),
- Delegating certain operations of public administration to local self-government,

31
- Regulated matter of incompatibility of functions of delegates.
- Envisaged protection of delegates mandate in court proceedings also,
- Regulated relation between central and local government (cooperation and supervision of legality
of work of local government),
- Strengthening direct democracy direct participation of citizens in functioning of local self-
government (civic initiative; citizens assembly and referendum),
- Ensured protection of local self-government,
- set criteria for founding cities,
- Financing of local self-government is regulated by special law - the Law on Local Government Fi-
nancing (Official Gazette of RS, Nos 62/06,47/11 and 93/12);
Law on Territorial Organisation of the Republic of Serbia
- Established territory of territorial units and other issues significant for territorial organisation of the
Republic of Serbia,
- territorial organisation of the Republic of Serbia consist of municipalities, cities and city of Bel-
grade as territorial units (150 municipalities, 23 cities and city of Belgrade as special territorial
unit) and autonomous province as a form of territorial autonomy,
- Establishment of new local government units, abolition of and changes in the existing territories are
preceded with referendum at the territory (consultative referendum),
- Established procedure (in more detail, compared to the previous law) for making these territorial
changes;
Law on the Capital City (by the adoption of this law the alignment with the Constitution providing for
the adoption of a special law on the capital city was carried out)
- Broader competence of the city of Belgrade in relation to other local government units with a ten-
dency for further broadening by adoption of special laws from different fields,
- Great autonomy and particularity when competencies are in question but less in organisation of au-
thority.
In accordance with constitutional authorization for cities to regulate and ensure performance and de-
velopment of utility activities and that a city has competences that are constitutionally delegated to munici-
pality, and under the law other competences can be delegated to them, the Law on the Community Police
(Official Gazette of RS, No 51/09) was adopted as lex specialis.
Priorities for 2013 with regard of harmonization of legislation:
Draft Law amending the Law on Local Self-Government
Draft government conclusion regarding changes in rules and procedures for criteria for determining the
composition of national delegations for the Congress of Local and Regional Authorities of Europe
Amendments to the Law on the Community Police
Law on Employees in Local Government Units
This legislation governs the field of local self-government in accordance with the Constitution and
sectoral laws regulating the fields under the competences of local government units where valid Law on Lo-
cal Self-Government is already harmonized with the European Charter on Local Government.
In that regard, we underline that there are no specific regulations of the European Union that require
harmonization of the above mentioned laws.
Administrative capacities
Law on Ministries (Official Gazette of Republic of Serbia, No 72/12 from 26 July 2012) established
the Ministry of Regional Development and Local Self-government. For performing work under the scope of
the Ministry, the following basic internal units were formed:
1. Sector for Regional Development
2. Sector for Investments in Infrastructure Projects
3. Sector for Local Self-Government
4. Sector for Strategic Analysis and Development Research;

32
5. Sector for European Integration, International Cooperation and Projects
6. Sector for Decentralization of the Republic of Serbia
Sector for Decentralization took over competences of former Office of the National Council for De-
centralization of the Republic of Serbia.
Measures for implementation of priorities in 2013
- Strategy for Professional Development of Employees in Local Government Units
- Strategy on Decentralization
- Signing Additional Protocol to the European Charter on Local Self-Government
Measures planned for the period 2014-2016
In the period 2014-2016 we expect implementation of activities in preparation of amendments to other
laws (and, potential bylaws) regulating the local government subject.
Overview of current and planned foreign development aid

MISP IPA 2008 Municipal Infrastructure Support programme


Programme for supporting development of infrastructure in local self-government is the project fi-
nanced by the EU and implemented by the Delegation of the European Union in the Republic of Serbia.
Programme includes three different components: 1. Transforming public utility companies, 2. Improv-
ing municipal capacities for municipal infrastructure programming and project preparation and 3. Implemen-
tation of selected local/regional projects.
The value of MISP - IPA 2008 is 55.4 million (45.4 provided from the EU and national co-financing
in the amount of 10 million from NIP funds).
MISP IPA 2010 - Municipal infrastructure support programme
Programme for supporting development of infrastructure in local self-government is the project fi-
nanced by the EU and implemented by the Delegation of the European Union in the Republic of Serbia.
Programme includes two different components: 1. Improving municipal capacities for municipal infra-
structure programming and project preparation and 2. Implementation of selected local/regional projects.
The value of MISP - IPA 2010 is 41 million (31 million provided from the EU and national co-
financing in the amount of 10 million).
Strengthening administrative capacities of local self-governments, IPA 2012, project is approved for
financing
Implementation period: 2013-2016.
Overall objective of the project is further development of administrative capacities of local govern-
ment units in Serbia through modern human resources management and professional development of em-
ployees.
Project value is 2 million (1.8 million from IPA 2012 funds and 0.2 million co-financing from the
Council of Europe)
Project will be implemented by the Council of Europe.
In the period until December 2012, these projects aimed at strengthening capacities at
local level were successfully implemented:
MSP IPA 2007 - Good Local Governance, Planning and Service Delivery
Project started in January 2010 and was completed in January 2013. Goal of this project was to im-
prove capacities of good governance and municipal management on local level, improve local service for
citizens and increase local economic development through strengthening local organizations, Standing Con-
ference of Towns and Municipalities as well as cooperation between local and central authorities.
Project value was 7.700.000.
Strengthening local self-governments in Serbia, phase 2
Project started in April 2009 and was completed on 27 December 2012. Goal of the project was to
provide support to central and local authorities in Serbia in further elaboration of the strategy on decentrali-
zation and application of institutional and legal reforms in the field of local self-government in Serbia.

33
Project value was 2.2 million from IPA 2007 funds. Project was implemented by the Council of
Europe.

1.1.5. Electoral System


Overview
Parliamentary, provincial, local and presidential elections in Serbia were held on 6 and 20 May 2012.
Pursuant to the Law on Election of National Assembly Members (Official Gazette of RS, No
35/2000, 69/2002, 57/2003 - CC, 72/2003 state law, 18/2004, 85/2005 - state law, 101/2005 state law,
104/2009 state law, 28/2011 - CC and 36/2011) election of MPs for the National Assembly of the Republic
of Serbia shall be held in line with a proportional electoral system, based on lists from political parties, coali-
tions, other political organizations and lists proposed by citizens groups.
President of the Republic
The Law on Election of the President of the Republic (111/2007-7, 104/2009-57 (state law) estab-
lished that the President of the Republic shall be elected on the grounds of general and equal suffrage in free
and direct elections, in secret and personal voting. President of the Republic is elected for 5 years.
Law on Single Voter Register
Law on Single Voter Register (Official Gazette of RS, No 104/09) was adopted on 11 December 2009
and its enforcement started on 24 December 2011. Law on Amendments to the Law on Single Voter Register
(Official Gazette of RS, No 99/11) was adopted on 26 December 2011.
The law governs bodies competent for keeping and updating voter register, manner of keeping and up-
dating of voter register, procedure for keeping voter register, excerpts from voter register, special rights of
participants in the elections, monitoring, application of the law to the elections for the President of the Re-
public and to provincial and local elections as well as other matters significant for keeping voter register.
Voter register is kept by the ministry competent for public administration. Keeping voter register by
the ministry competent for public administration covers: Analyzing data from voter register and taking
measures for securing their compatibility and accuracy, making changes to voter register (entry, deletion,
change, addendum or corrigendum) after finalization of voter register in accordance with this law.
Part of voter register for the area of local government units is updated by municipal or city administra-
tion as delegated work. Updating voter register for the area of local government units by municipal or city
administration includes making changes in voter register (entry, deletion, change, addendum or corrigendum)
on its own motion or at the request from a citizen until finalisation of voter register and other works in ac-
cordance with this law.
Law on Political Parties
On 12 May 2009, the National Assembly of the Republic of Serbia adopted the Law on Political Par-
ties (Official Gazette of RS, No 36/09) whose implementation started on 23 July 2009 and it governs consti-
tutionally guaranteed freedom of political association in accordance with international acts and adopted
standards. Pursuant to Register of Political Parties, there are 91 registered political parties: 38 political par-
ties and 53 minority political parties.
Law on Local Elections
After adopting amendments to the Law on Election of National Assembly Members, in July 2011 the
National Assembly adopted the amendments to the Law on Local Elections. Namely, Amendments to the
Law on Local Elections provided for harmonisation with the Decision of the Constitutional Court of the Re-
public of Serbia from 21 April 2010 repealing blank resignations of delegates; established closed electoral
lists and regulated the issue of women participation in the elections (on every three candidates on an electoral
list there must be at least one candidate of the less represented gender) which is all in line with the European
standard.
The National Assembly adopted the Law on Financing Political Activity on 14 June 2011. This law
governs sources and manner of financing, records and control of financing of political activities of the parties
and coalitions and citizens groups.
Implementation of the Law on Financing Political Activity (Official Gazette of RS, No 43/2011)
(hereinafter: the Law) started on 22 June 2011 except provisions from articles 16 and 17 that entered into

34
force on 1 July 2012. By entry into force of this law, the Law on Financing of Political Parties (Official Ga-
zette of RS, No 72/2003, 75/2003 corrigendum, 60/2009 CC and 97/2008) ceased to be valid except pro-
visions of article 4 that was applicable until the day articles 16 and 17 of the Law entered into force.
Control and monitoring of reports kept and submitted by the political subjects that have their represen-
tatives in representative bodies (annual financial report, report on donations, report on assets) as well as re-
cords (on donations, gifts and assets) is carried out by the Anti-Corruption Agency.
Office for Democratic Institutions and Human Rights ODIHR presented in the Ministry of Justice and
Public Administration final report of OSCE Mission on general elections in the Republic of Serbia and high-
lighted positive assessment in the report relating to the observance of human freedoms and rights and posi-
tive opinion (considering short timeframe) for establishing Single Voter Register.
EU citizens rights in local elections
Right to vote and act in candidate capacity in local elections
Citizens of the European Union enjoy voter rights in local elections in a member state of residence in
the same way as do citizens of that country. This right is provided in article 22 paragraph 1 of the Treaty on
the Functioning of the European Union and regulated in more detail by the Directive 94/80/EC from 19 De-
cember 1994 which established detailed measures for exercising the right to vote and participate in local
elections for the citizens of the European Union with residency in a member state without being its nationals.
In order to harmonize our legislation with the EU regulations in this field it is necessary to make
changes to the following regulations:
- Law on Single Voter Register
- Law on Local Elections
- Law on Local Self-Government
Timeframe for adoption of envisaged amendments to these laws will be established depending on dy-
namics of the European integration process.
Amendments to these laws should cover:
- In the Law on Single Voter Register adopted in December 2009 (Official Gazette of RS, No 99/11)
it is required to include amendments that would provide for keeping registers on the EU citizens
with the residency in Serbia that would have the right to vote.
- Pursuant to the Law on Local Elections, any citizen of age and working ability with a place of resi-
dence in the territory of local government unit where the electoral right is exercised has an active or
passive electoral right. This provision will be amended to enable implementation of EU regulations
on active and passive electoral right in local elections of EU citizens residing in a member country
other than their home country.
The current Law on Local Self-Government is fully aligned with the European Charter of Local Self-
Government. Adjustments with relevant EU regulations are possible as conditions for exercising suffrage for
EU citizens are concerned.
The EU regulations whose implementation should be ensured by amending these regulations of the
Republic of Serbia are: Council Directive 94/80/C, Council Directive 96/30/C, Council Directive
2006/106/C.

1.1.6. Judicial system


See Chapter 3.23 Judiciary and Fundamental Rights

1.1.7. Anti-corruption policy


See Chapter 3.23 Judiciary and Fundamental Rights

1.1.8. Defence reform


Overview
Implementation of defence system reform based on established defence policy represents one of fun-
damental strategic direction of the Republic of Serbia in the process of its integration into political, economic
and security tendencies of the Europe and modern world.

35
Purpose of the reform is to develop efficient and economically sustainable defence system, modern,
professional and efficient Serbian Armed Forces and to improve democratic and civilian control of the Ser-
bian Armed Forces.
Significant results are achieved within the reform so far. These relate to the establishment of suitable
strategic doctrine, regulatory-legal, planning and organizational and functional framework and to the field of
human and material resources, international cooperation in defence field, transparency of defence operations
and democratic and civilian control of the army. Achieved results contributed not only to strengthening of
the status and reputation of the Republic of Serbia in international community but also to the increased con-
fidence of citizens in the Serbian Armed Forces as well as increased reputation of military profession in our
country.
In previous period in the process of creating a suitable strategic doctrine framework for implementa-
tion of defence reform, on 26 October 2009 the following strategies were adopted: National Security Strat-
egy of the Republic of Serbia (Official Gazette of RS, No 88/09) and Defence Strategy of the Republic of
Serbia (Official Gazette of RS, No 88/09) as well as the Action Plan for implementation of the Defence
Strategy of the Republic of Serbia (2010), Doctrine of Serbian Armed Forces (25 February 2010) and func-
tional doctrine and doctrine of branches (2012).
Commitments from the strategic documents are in accordance with foreign policy orientation of the
Republic of Serbia and fully compliant with the European political, economic and security perspective of the
Republic of Serbia.
Strategic and doctrinal documents will be building upon in accordance with the state of affairs and
perspectives of security surroundings of the Republic of Serbia, its interests, economic possibilities and
changes in other determining factors.
In creating a suitable planning framework for the defence system reform process the following were
adopted: Long-term development plan for defence system of the Republic of Serbia (2011), Midterm devel-
opment plan and programme for defence system for the period of 2012-2017 (2012), Strategic overview of
the Serbian defence (2009) and Ministrys instruction for 2013 (2012).
Further on, we note that in the Ministry of Defence and Serbian Armed Forces since 2011 we imple-
ment National action plan for implementation of the United Nations Security Council Resolution 1325-
Women, Peace and Security in the Republic of Serbia (2010-2015) improving defence system reform process
by introducing international standards, primarily standards of the United Nations, European Union, NATO
and OSCE from the field of gender equality into domestic legislation and strategic and planning documents.
In order to complete strategic, doctrinal and planning framework for the process of reforming defence
system, we are currently drafting a strategic overview of defence of the Republic of Serbia, Midterm devel-
opment plan and programme for defence system for the period 2013-2018 and other doctrinal documents.
Republic of Serbia completed regulatory and legal framework for defence system reform by adopting
required system laws compatible with the European integration process.
Constitution of the Republic of Serbia as the highest legal act defined the place and role of the Serbian
Armed Forces. Basic systemic laws adopted in 2007: Law on Defence (Official Gazette of RS, No 116/07,
88/09 state law and 104/09 state law), Law on Serbian Armed Forces (Official Gazette of Republic of
Serbia, 116/07, 88/09 and 101/10 state law) and Law on Organisational Principles of Security Services of
the Republic of Serbia (Official Gazette of Republic of Serbia, 116/07 and 72/12) and in 2009 in the field of
defence and security the following were adopted: The Law on Engagement of the Serbian Armed Forces and
other Defence Forces in Multinational Operations outside the Republic of Serbia borders (Official Gazette
of RS, No 88/09) and the Law on Military Security Agency and Military Intelligence Agency (Official Ga-
zette of RS, No 88/09 and 55/12-CC), Law on Civilian Service (Official Gazette of RS, No 88/09), Law on
Conscription, Compulsory Labour and Requisition (Official Gazette of RS No 88/09 and 95/10) as well as
amendments to the Law on Defence and the Law on the Serbian Armed Forces. By the adoption of these
laws, suitable regulatory and legal framework was created for continuation of defence system reform and
strengthening mechanisms of democratic and civilian control of the Serbian Armed Forces.
Democratic and civilian control of the Serbian Armed Forces are implemented by the National As-
sembly, Government, courts and public and represents a significant feature of democratic society and condi-
tion for the integration into contemporary security structures. By accepting democratic and civilian control as
one of the postulates of democratic society, the Republic of Serbia defined democratic and civilian control of
an army as a constitutional principle. In the previous period, regulatory and legal assumptions for enforce-
ment of procedures of democratic and civilian control of the Armed Forces of the Republic of Serbia were

36
created; this is realized through control of use and development of the Army, internal and external control of
expenditures for military needs, monitoring state and informing public on military preparation states, free
access to information of public importance and establishment of liability for performing military duties.
Also, legislation on Ombudsman relating to protection and exercising citizens rights, apply to professional
members of the Serbian Armed Forces (Law on the Serbian Armed Forces, article 29). By strengthening
mechanisms of democratic and civilian control, the Armed Forces and defence system in a whole become the
foundation for the whole democratic development of the Republic of Serbia.
Imposition of the function of Inspector General for military security services and/or Military-Police
Inspector for the Military Police competent for internal control of operation of these services regarding legal-
ity of application of given powers, represented an important novelty compared to the previous period.
Professionalization of the Serbian Armed Forces was carried within the framework of defence system
reform followed by the abolishment of compulsory military service on 1 January 2011 but providing possi-
bility of voluntary service.
Planning policy for material resources for the needs of defence is being implemented with the obser-
vance of the principles of efficiency and transparency in calculation and expenditure of approved funds. Proc-
ess of material resources management includes programmes contributing to strengthening interoperability with
armed forces from countries participating in the Partnership for Peace and NATO.
Procurement of armament and military equipment is being realized through research, development and
procurement of new resources and systems as well as modernization of the existing combat systems. In the
procurement process for armament and military equipment, scientific-research and production capacities of
the Republic of Serbia are primarily used in accordance with technological potentials and economic feasibil-
ity. In procuring resources from import the advantage is given to joint projects with foreign partners, primar-
ily with those including technology transfers and employment of economic capacities in the Republic of
Serbia.
In the financial crisis conditions, the importance of international initiatives for unifying and sharing
resources and developing projects for decreasing expenses in defence field is getting bigger and at the same
time capabilities are developed through multinational approach.
Having in mind that cooperation through the European Defence Agency programmes is good way to
reach the objectives of capacity development that EU members would probably not be able to achieve indi-
vidually, in 2012, the Republic of Serbia started approaching an administrative arrangement with the EDA as
a form of cooperation with non-member countries of the EU. Republic of Serbia submitted application for
the EDA, primarily because through cooperation and EDA activities it sees the opportunity for strengthening
domestic defence contractors and market enlargement. Introduction of new technologies in a defence system
requirement and stimulates further development.
Infrastructure capacities of defence system are developed in accordance with the defence needs. Facili-
ties and complexes that are no longer functional for the Serbian Armed Forces are covered by the Master
plan for sale of surplus military real-estates in the Republic of Serbia.
More efficient management of defence resources will be continued through the application of a system
for planning, programming, budgeting and implementation (PPBI) in the Ministry of Defence and the Ser-
bian Armed Forces whose implementation will ensure optimized resources management with a view to
maintain and develop capacities of the Ministry of Defence and the Serbian Armed Forces for achieving de-
fence policy objectives of the Republic of Serbia.
The basic direction in projecting defence system finances is to provide for development of required
capacities of defence system elements with better structure of defence budget expenditures i.e. larger part
relating to investments and operational expenses and at the same time decreased personnel expenses. In this
regard, situation was improved in 2012 by allocation of part of funds for military pensions from a total
amount of defence funds having in mind that these expenses made significant part of personal expenditures
of the defence system.
Although it is expected that budgetary resources allocated for defence will remain to limit defence sys-
tem development, we will continue to make efforts to ensure additional funds for modernisation and pro-
curement of modern armaments and military equipment, notably, from own incomes and donations.
Under the Serbian Armed Forces reform, bilateral and multilateral military cooperation with countries
from the region, the most important countries in the international community and international security or-
ganizations were intensified. Republic of Serbia is ready to contribute to peace and stability through dialogue

37
and cooperation and to strengthen own security through engagement in the activities of international security
structures.
Through the European integration process, the Republic of Serbia express readiness to build capacities
and facilities of the national security and defence system in accordance with standards and obligations under
the EU Common Security and Defence Policy (CSDP). In 2012, the Republic of Serbia started participating
in informal meetings of the EU defence ministers, the EU Military Committee, negotiations on membership
in the EDA and engaged into two EU military operations.
Under NATO programme Partnership for Peace, the Republic of Serbia carries out assumed obliga-
tions and develops cooperation with other member states to this programme. The Serbian Armed Forces par-
ticipate in multinational military manoeuvres on the territory of the Republic of Serbia as well as territories
of member states of the Partnership for Peace and NATO.
The Republic of Serbia stands up for intensive cooperation in defence field in the region of South-East
Europe and contribute to strengthening stability and security by participating in all regional initiatives in the
defence field. In the capacity of a member in the process of cooperation among the Ministries of Defence of
SEE countries SEDM, Forum for Western Balkans Defence Cooperation SEEC, Centre for Security Co-
operation RACVIAC and Balkans Countries Chiefs of Defence Conference and in observer capacity in the
USA- Adriatic charter (A-5). Through project approach in regional initiatives, the Ministry of Defence pro-
motes development and declaration possibilities of the following national capacities into regional centres:
NBC training center, Military Medical Academy, University of Defence, the South base, Peacekeeping Op-
erations Center, Centre for Disposal of Ammunition and Armaments TRZ Kragujevac.
Provision of article 5.4 of the Law on Defence (Official Gazette of RS, 116/07, 88/09, 88/09 state
law and 104/09 state law) prescribed that countrys defence is exercised by participation in multinational
operations as well as that in the case of a threat to peace and security in the world, members of the Serbian
Armed Forces in accordance with the law and decision of the National Assembly could be sent to multina-
tional operations outside the Serbian borders (article 40). Engagement in peace missions is realized based on
political decision of the state, with own forces or through bilateral agreements with another larger member
state.
Law on Engagement of The Serbian Armed Forces and other Defence Forces in Multinational Opera-
tions outside the Republic of Serbia borders regulated this field in accordance with the interests of the Re-
public of Serbia shown in strategic documents with a view of preserving security and peace in the world as
well as providing humanitarian assistance to other countries in crisis. Considering contemporary character of
multinational operations this law provides for the involvement of other state institutions besides armed forces
members.
The conditions for the engagement of The Serbian Armed Forces and other Defence Forces in these
operations are created by signing the Agreement on Security Procedures for the Exchange of Confidential
Information and the Agreement on the Establishment of the Framework for Participation in the European
Union Crisis Management Operations between the Republic of Serbia and the European Union and adoption
of decisions from the EU Political and Security Committee on acceptance of the Republic of Serbias par-
ticipation in the EU crisis management operations.
Members of the Serbian Armed Forces are engaged in multinational operations under the mandate of
the United Nations and the European Union based on the Annual Plan for the Use of Serbian Armed Forces
and Other Defence Forces in Multinational Operations adopted by the National Assembly of the Republic of
Serbia. With a view of building and maintaining peace in the region and in the world, participation of SAF
members in multinational operations is significantly increased during 2012. SAF members currently partici-
pate in 6 multinational operations under the mandate of the United Nations and 2 military operations of the
European Union: the EU mission for training Somalian security forces in Uganda (EUTM Somalia) 1 SAF
member and military operation of the EU naval forces against piracy in Somalia (EUNAVFOR
ATALANTA) 2 SAF members. In the following period, the Republic of Serbia is interested in increas-
ing the number of its representatives and fields of their engagement in the EU multinational operations.
Preparatory Plan for participation in a multinational operation is established and implemented by the
Ministry of Defence for SAF members. Ministry of Defence and the Serbian Armed Forces are obliged to
organise and coordinate, in cooperation with competent bodies, all activities regarding preparation of the
Serbian Armed Forces members and other defence forces that are being sent abroad to perform approved
multinational operations.

38
Peacekeeping Operations Centre of the Serbian Armed Forces carries out selection, training, education
and preparation of persons and participates in preparing units for multinational operations as well as monitor-
ing engagement of members of MoD and SAF in multinational operations outside the Republic of Serbia
borders. In this context, the center is competent for planning, developing and monitoring state of affairs and
capabilities assessments of SAF and other defence forces for participating in multinational operations.
By engaging members of the Serbian Armed Forces in multinational operations under the European
Union mandate under CSDP, the Republic of Serbia integrates into this important activity of the European
Union which will have a positive influence to the whole European integration process of the Republic of
Serbia. Operationalizing partnership per standards and obligations under CSDP, the Republic of Serbia sig-
nificantly continues to contribute to intensification of dialogue and facilitation of the process of acquiring the
membership in the European Union.
Priorities for 2013 with regard of harmonization of legislation
The Republic of Serbia does not have to harmonise legislation with the EU acquis in the defence field
in 2013. In the following period we face adoption of a certain number of legislation that will contribute to
achievement of required standards in the defence reform process. Having in mind that adoption of these acts
is not classical harmonization of legislation with the EU acquis, there is no need for their entry into NPAA
database.
With a view to fulfil recommendations of the European Commission from the Annual Progress Report
for the Republic of Serbia in the European integration process for 2012, the Ministry of Defence prepared
draft law on amendments to the Law on Military Security Agency and Military Intelligence Agency accord-
ing to which sensitive data in connection with citizens communication will be monitored only based on a
court order. Adoption of this law is planned for March 2013.
For March 2013 the adoption of a new law was planed, the Law on Production and Trade in Arma-
ment and Military Equipment.
To precise certain provisions for more efficient enforcement of obligations and remove uncertainties
identified in implementation analysis, amendments to the Law on Defence were planned for April 2013 and
to the Law on Serbian Armed Forces and the Law on Conscription, Compulsory Labour and Requisition for
May 2013.
Adoption of the Law on Education in Defence System for regulating specific education for the needs
of defence system was planned for September 2013.
Amendments to the Law on Engagement of the Serbian Armed Forces and other Defence Forces in
Multinational Operations outside the Republic of Serbia borders were planned for October 2013 with a view
to precise certain provisions in order to enforce the law in more efficient way.
Adoption of the Law on Military Health Insurance and Healthcare was planned for December 2013 in
order to regulate issues important for healthcare system and health insurance of military personnel.
Administrative capacities
Regarding the EU accession process in the field of defence reform we do not plan for special measures
because the existing capacities of the defence system can perform operations from the European integration
domain. Namely, observing the commitment that the European integration process is one of the national pri-
ority interests of the Republic of Serbia as well as the importance of improving relations with the European
Union, the Ministry of Defence continuously makes efforts in strengthening institutional and human re-
sources capacities.
Ministry of Defence organization is harmonized with the standards and organizational arrangements
applied in other modern countries. In organizational sense, the General Staff of the Serbian Armed Forces
represent special internal unit of the Ministry of Defence. Organizational changes in the Serbian Armed
Forces are realized in accordance with contemporary principles and standards for organization and function-
ing of a military organization but also in accordance with the requirements coming from professionalization
process of SAF, need for improving operational and functional capacities as well as principle of financial
viability.
Within the Ministry of Defence, the Group for European Integration and Regional Initiatives and the
Administration for International Military Cooperation in the Department for Defence Policy and when re-
quired other organizational units of the MoD are engaged in activities in connection with the European inte-
gration process and participation of the Republic of Serbia in CSDP activities . During 2011, special units in
MoD were formed that indirectly contribute to empowerment of the defence system of the Republic of Ser-

39
bia for participating in CSDP activities (Centre for Simulations and Distance Learning in the Mili-
tary Academy, Group for PARP and Coordination of Standardization in the Strategic Plan-
ning Department of the Defence Policy Sector) In order to improve drafting and realization of projects
in the Ministry of Defence, where some of them can be supported from donations, in 2012, Direction for Pro-
ject Management was established within the Budget and Finance Sector. During 2010, the Military Repre-
sentative Office in the Republic of Serbias Mission in NATO was established performing also cooperation
activities with the EU in the defence filed. Serbian Armed Forces declared forces for engagement in multina-
tional operation under the UN mandate that could be used for participation in the European Union opera-
tions.
In order to reach required capacities of the defence system, special attention was given to staff train-
ings. In 2011, the University of Defence was established with curricula and organisation of lectures in line
with the Law on Higher Education of the Republic of Serbia and Bologna declaration. In 2012, in the Mili-
tary Academy by the Decision of the Minister of Defence on organization of the fourth level of professional
education, High Security and Defence Studies were established. In accordance with the Convention on Ob-
servance of Human Rights and Gender Equality and experiences of the majority of the European countries,
education of women started in 2007/2008 in the Military Academy and the first generation graduated in
2011. In the defence field, international standards for studies and knowledge testing were adopted; for for-
eign language STANAG 6001 and information technologies ECDL.
Cooperation with higher education institutions in country and abroad was intensified through im-
provement and introduction of common study programmes and student exchanges. Members of the Ministry
of Defence and Serbian Armed Forces refer to different forms of education and training in country and
abroad. Further professional development of personnel in the field of the Common Security and Defence
Policy of the EU was planned.
In the following period, organizational structure of the Ministry of Defence and Serbian Armed Forces
will be upgraded in accordance with the needs and with a view to make it functionally optimized, establish-
ing more efficient management in the defence system, rationalizing number of vacancies and balancing ratio
between a number of military and civilian staff as well as consistently implementing the principle of democ-
ratic and civilian control.
Measures for implementation of priorities in 2013
In the field of defence system reform we did not plan for special measures in connection with the EU
accession process.
In the following period, main tasks within defence reform process are:
- monitoring implementation of adopted strategic, regulatory and legal and planning documents from
defence field;
- ensuring stable financing for defence system;
- further implementation and improvement of PPBI system;
- improvement and development of operational and functional capacities of SAF;
- Achieving the required level of interoperability;
- procurement and modernization of armaments and military equipment;
- strengthening capacities of military industry and intensifying military-economic cooperation;
- Intensifying activities in achieving goals under the partnership in NATO and PfP programme.
- optimizing organizational-formational structures of MoD and SAF;
- Improving the status of military and civilian personnel in the defence system;
- intensifying activities of international cooperation in defence field;
- participating in multinational operations and military manoeuvres;
- strengthening democratic and civilian control of the Serbian Armed Forces;
- integration and inclusion of military health institutions of the Ministry of Defence and Serbian
Armed Forces into unified health system of the Republic of Serbia;
- organization and functioning of a religious service in the Serbian Armed Forces,
- Transformation of military complexes through realization of the Master plan.

40
Measures planned for the period 2014-2016
The Republic of Serbia does not have to harmonise legislation with the EU acquis in the defence re-
form field in the following three years of the NPAA implementation. However, Ministry of Defence plans to
sign the Administrative Agreement with the European Defence Agency whose ratification and implementa-
tion is planned for 2014.

1.2. Human rights and the protection of minorities


1.2.1. Observance of international instruments for human rights protection
Overview
The Republic of Serbia ratified all mayor international legal instruments from the field of human
rights but there are further efforts in implementing international legal instruments.
The Republic of Serbia is UN member and it is obliged for periodical reporting to the UN contracting
bodies on implementation of eight basic international agreements on human rights: International Covenant
on Civil and Political Rights, International Covenant on Economic, Social and Cultural Rights, Convention
Against Torture and Other Cruel, Inhuman or degrading Treatment or Punishment, International Convention
on the Elimination of All Forms of Racial Discrimination, Convention on the Elimination of All Forms of
Discrimination against Women, Convention on the Rights of the Child, Convention of the Rights of Persons
with Disabilities, International Convention for the Protection of All Persons from Enforced Disappearance.
Serbia is also member of the European Convention for the Protection of Human Rights and Fundamental
Freedoms, Framework Convention for the Protection of National Minorities, European Charter for Regional
and Minority Languages and the European Convention against Torture and Other Cruel, Inhuman or degrad-
ing Treatment or Punishment.
European Court of Human Rights
Up until now European Court of Human Rights (ECHR) delivered 73 judgments upon an appeal from
citizens and found that Serbia breached at least one right guaranteed by the European Convention of Human
Rights (ECHR) in 63 delivered judgements. Most of the judgements so far related to length of court proceed-
ings and failure to enforce domestic judgements. There are currently around 10.000 complaints before the
ECHR against Serbia putting it at the sixth place from 47 countries in the Council of Europe. In respect of
number of citizens Serbia is in the first place. Four big groups of complaints can be observed. First group is
made of complaints regarding old debts of socially-owned companies on the basis of final conviction from
labour-related claims. In order to enforce judgements delivered in that regard that became final, in March
2012, the Government adopted regulation for registering outstanding dues of socially-owned companies in
accordance with enforceable judgments regarding labour-related claims. Pursuant to this regulation deadline
for the application for these dues is the end of 2012. After that a total amount of the debt will be determined
and by March 2013, the Government should propose programme with measures for resolving the issue. The
second large group of cases relate to pensions in KiM whose payment stopped since 1999 and ECHR in case
Grudic established that this is violation of the European Convention of Human Rights. In order to enforce
this judgement entailing resolution of systemic problem regarding payment of pensions, interministerial
working group was formed that by March 2013 should propose measures for resolving this matter. Third and
fourth group of complaints relate to payment of war per-diems to reservists and payment of old foreign-
currency savings from other former Yugoslav republics. These are also systemic problems but judgements in
these cases are not yet final.
So far, 6 resolutions of the CoE Committee of Ministers were adopted noting that the Republic of Ser-
bia has fulfilled its obligations from delivered judgements of the Court. This means that there are still 57 de-
livered judgements under supervision of the CoE Committee of Ministers. Also, payment of the amounts
from agreed arrangements is supervised. Representative of the Republic of Serbia before the ECHR, in coop-
eration with other competent authorities, takes care on enforcing these measures and reports thereon to the
CoE Committee of Ministers.
All judgements from the European Court of Human Rights are translated and published on website of
the European Court of Human Rights, Ministry of Justice and Public Administration and in Official Gazette
of RS. The fifth book Decisions and Judgements of the European Court of Human Rights delivered in rela-
tion to Serbia was published and distributed to all state authorities.

41
Priorities for 2013 with regard of harmonization of legislation
Priority tasks for 2013 of the Department for Representation of the Republic of Serbia before the
ECHR:
- To decrease number of complaints against the Republic of Serbia before the ECHR through resolving
so-called systemic problems (resolving systemic issue with regard to debts of socially-owned compa-
nies from labour-related claims by establishing scope of liabilities of the Republic of Serbia on this
basis and by proposing measures for resolving this issue by the Ministry of Finance and Economy;
resolving systemic issues regarding the payment of pensions in Kosovo by prescribing conditions for
exercising this right which under the competence of the Ministry of Labour and Social Policy)
- To improve certain legal arrangements in order to enforce ECHR judgements and prevent new
complaints (for example, in the Law on non-contentious procedures, provide for provision regard-
ing periodical review of conditions for restoring legal capacity);
- To establish Human Rights Council (this authority would deal with the most important issues re-
garding human rights and specially the most important cases that Serbia has before the European
Court of Human Rights.)
Improving and exercising human rights
Overview
In the field of human and minority rights, Office for Human and Minority Rights in 2012 had under its
competence enforcement of three laws - Law on the Protection of Rights and Freedoms of National Minori-
ties (Official Journal of FRY 11/02 and Official Gazette of RS No 72/09 state law), Law on Prohibition of
Discrimination (Official Gazette of RS No 22/09) and Law on National Minority Councils (Official Gazette
of RS No 72/09).
Administrative capacities
Regarding institutional and administrative matters we point out that the Law on Ministries from 2012
envisaged that for performing works in relation to issues of importance for human and minority rights a spe-
cial service should be established. The same law prescribed that the Ministry of Justice and Public Admini-
stration shall perform public administration activities related to keeping register on national councils of
national minorities, appointments of national councils of national minorities and preparation of legislation on
human and minority rights.
By the Regulation on Office for Human and Minority Rights adopted on 2 August 2012, the Govern-
ment established the Office for Human and Minority Rights. Pursuant to the regulation, the Office performs
expert works for the needs of the Government and competent ministries relating to: protection and improve-
ment of human and minority rights; monitoring compliance of domestic legislation with international agree-
ments and other international acts on human and minority rights and initiating amendments to domestic
legislation; general issues of national minorities members; monitoring status of members of national minori-
ties living on the territory of the Republic of Serbia and exercising minority rights and establishing national
minorities connections with their kin states.
Office for Human and Minority Rights has 36 systematized jobs distributed through three sectors with
38 public servants and one official. In relation to the previous year in 2013 two new groups were established
Group for preparing projects financed by the EU and Group for implementation and monitoring implemen-
tation of project financed by the EU. Pursuant to the opinion of the Ministry of Finance and Economy, an
increase in number of jobs is planned in 2013.
Measures for implementation of priorities in 2013
Priority: Amendments to bylaw on the Serbian Council for National Minorities (first quarter)
Regulation on the Republic Council for National Minorities (Official Gazette of RS No. 52/09) pre-
scribed that the Council should deal with preserving, improving and protecting national, ethnical, religious,
language and cultural features of the members of national minorities and that its members are the President
and certain ministers in the Government of the Republic of Serbia as well as presidents of national councils
for national minorities. Starting from its competence to initiate adoption of legislation in the field of human
and minority rights, the Office for Human and Minority Rights will initiate adoption of amendments to the
bylaw on the Council for National Minorities of the Republic of Serbia.

42
The main priority of this measure is to renew operation of the Council and harmonize its composition
with the changes occurred in the public administration system after the formation of the new government in
2012.
Priority: Bylaw governing the application of affirmative measures for enrolling Roma pupils (second, third
and fourth quarter)
For achieving necessary improvement of law enforcement, the Office will also initiate adoption of a
bylaw further regulating implementation of affirmative measures for enrolling Roma population in high
schools in order to increase number of educated Roma.
The bylaw further regulating implementation of affirmative measures for enrolling Roma population
in high schools will be harmonised with the European Court practice (case Hellmut Marshal v. Land Nordr-
hein Westfalen - 409/95).
In the Annual Progress Report regarding the observance and protection of minorities and cultural
rights it was said that the number of Roma children enrolled in educational system increased" and that
drop-out rate of Roma children remained high.
Measures for implementing priorities in 2013
Priority: Adoption of Anti-Discrimination Strategy and accompanying Action Plan (second, third and fourth
quarter)
Office for Human and Minority Rights planned for 2013 to adopt Anti-Discrimination Strategy and
accompanying Action Plan for its implementation. Strategy includes harmonized system of measures,
conditions and instruments of public policy that Serbia should implement in order to prevent all forms and
special cases of discrimination, especially towards certain persons and/or groups of persons in regard to their
real or presumed personal attribute. The main segment of the strategy is directed to improvement of status of
the following vulnerable social groups that are most often exposed to discrimination and discriminatory
treatment: members of national minorities, religious communities and groups, women, LGBT, people with
disabilities, elderly persons, children, refugees, internally displaced persons and members of other vulnerable
migrant groups, as well as persons whose health condition could represent basis for discrimination.
Description of measure (priorities). This measure is aimed at fulfilling recommendation from the Pro-
gress Report of the European Commission particularly in preventing discrimination based on sexual orienta-
tion and gender identity. Strategy and its Action Plan will envisage additional measures for the fight against
discrimination and promotion of tolerance and development of proactive approach in achieving greater inclu-
sion of LGBT and better understanding and tolerance of the society towards them.
Adoption of Action Plan for implementation of Strategy for Improving Status of Roma (second, third and
fourth quarter)
Working version of draft Action Plan for Strategy for the Improvement of the Status of Roma is pre-
pared.
Description of measure (priorities). Action Plan for implementation of the Strategy for the Improve-
ment of the Status of Roma was valid until 2012 and it is necessary to adopt new plan that would envisage
concrete measures as well as deadlines and competences for its implementation.
List of legislation relevant for harmonisation
Action Plan does not require special harmonization with the EU acquis because the legislation in this
field has already been harmonized. However, it should be said that the Action Plan will be harmonized with
the EU Framework for national Roma integration strategies as well as Guidelines of the European Commis-
sion for drafting national Roma integration strategies or integrated set of measures.
Level of compliance with a specific EU legislation. None
Link with strategic document
In the Analytical report, inter alia, it was stated that Action Plan for implementation of Roma Strat-
egy for 2012-2014 has not yet been adopted.
Adoption and submission of national reports on implementation of international agreements in the field of
human and minority rights
The Office planned for 2013 to submit reports on implementation of international agreements in the
field of human and minority rights
Description of measure (priorities). Within reporting on implementation of international agreements in
the field of human and minority rights a number of measures will be implemented.

43
The Republic of Serbia will participate in the second cycle of Universal Periodic Review before UN
Human Rights Council on 30 January 2013 (first quarter).
Common Core Document on the Republic of Serbia, reference document representing a constituent
part of all national reports on implementation of basic international agreements on human rights will be up-
dated and delivered to UN contracting bodies.
The Republic of Serbia will present to the UN contracting body the second and third periodic report on
the application of the Convention on the Elimination of All Forms of Discrimination against Women in July
2013.
Competent UN contracting bodies will be provided with the second periodic report on implementation
of the Convention Against Torture and Other Cruel, Inhuman or Degrading Treatment or Punishment, inte-
grated second and third periodic report on implementation of the Convention on the Rights of the Child and
Initial Report on Implementation of the Convention for the Protection of all Persons from Enforced Disap-
pearance.
The Council of Europe will be provided with the third report on implementation of the Framework Conven-
tion for the Protection of National Minorities and second report on implementation of the European Charter for Re-
gional and Minority Languages.
Measures planned for the period 2014-2016
Adoption and submission of national reports on implementation of international agreements
in the field of human and minority rights
The Office planned for the period of 2014 - 2016 to submit reports on implementation of international
agreements in the field of human and minority rights.
Second and third periodic reports on implementation of the International Convention on the Elimina-
tion of All Forms of Racial Discrimination should be delivered to competent UN contracting body in January
2014.
Third periodic report on implementation of the International Covenant on Civil and Political Rights
should be delivered to competent UN contracting body until April 2015.
Overview of current and planned foreign development aid
- Three-year programme for implementation of the Strategy for Improvement of the Status of Roma
in the Republic of Serbia shall be implemented in cooperation with OSCE mission in Serbia with
financial support from the Swiss Agency for Development and Cooperation. Expected project re-
sults are: ensured legal aid in procedures of registration in the birth registry, revised Action Plan for
implementation of the Strategy for the Improvement of the Status of Roma in the Republic of Ser-
bia, developed standardized system for reporting on implementation of Roma inclusion policy, in-
creased number of young Roma included in implementation of inclusion policies, provided
assistance in participation of Roma civil society organizations, provided support to the develop-
ment of local inclusion teams, approved small grants for supporting local inclusion policies, se-
lected pilot municipalities who will receive large grants for implementation of comprehensive
inclusion programmes. Project is implemented from November 2010 until November 2014. Project
budget is 3.098.000.
- Implementation of the Strategy for Improvement of the Status of Roma in the Republic of Serbia
IPA 2012 Component V. Project goals are: Providing legal aid in procedures of later registration in
the birth registry and/or issuance of personal documents for at least 1000 Roma; increased number
of Roma in at least 20 municipalities regarding the access to fundamental rights, labour market,
education, social protection and health care as a result of common work of mobile teams in the
filed by the end of implementation of the measures; increased number for at least 10% of Roma
participating in civil initiatives specially those regarding increased social inclusion of Roma, for at
least 5% decreased number of Roma children dropping out of school at all levels/grades in com-
parison with the number of Roma children that enrolled into high schools; Roma communities in
Serbia are mapped and plans for further regulations are made as well as technical documentation
for improving living conditions and infrastructure in at least 20 municipalities will be completed by
the end of the measure implementation; implemented at least three pilot programmes of coopera-

44
tives offering employment possibilities for at least 50 Roma. Project will be implemented from
March 2013 to June 2015. Project budget is 4.800.000.
- Project Implementation of Anti-discriminatory Policies IPA 2011 is implemented from Novem-
ber 2012 to November 2014 by the Office for Human and Minority Rights and the Office of Com-
missioner for the Protection of Equality. Project purpose is efficient implementation of anti-
discriminatory policies in accordance with the European standards and examples of good practice,
empowering different mechanisms for efficient implementation of anti-discriminatory legislation and
trainings for representatives of relevant state institutions. Activities aimed at empowering capacities
of the Office of Commissioner for the Protection of Equality are envisaged.
- Drafting of the Anti-Discrimination Strategy is supported by the project financed by the govern-
ments of Great Britain in the amount of GBP 35.000 and the Netherlands with EUR 30.100 as well
as the Balkan Trust for Democracy with USD 14.800. Basic goals of the strategy are: decreased
general level of discrimination in society and improved status of vulnerable groups.
- The Republic of Serbia is one of the partners in the project of the Council of Europe titled Fight
against discrimination based on sexual orientation and gender identity together with Albany, Italy,
Latvia, Montenegro, Poland. The objective of this project is to support implementation of the Rec-
ommendation CM/RES (2010) of the CoE Committee of Ministers on measures for fighting dis-
crimination based on sexual orientation and gender identity. Within this project, the Office for
Human and Minority Rights organized initial national seminar where recommendations of the
Committee of Ministers were presented as well as the report of Commissioner for Human Rights
Thomas Hammarberg on the subject of discrimination of LGBT population from June 2011. This is
the first gathering dedicated to improvement of the rights of LGBT that was organized by a state
institution.
- Internship for Young members of national minorities in state institutions in the Republic of Ser-
bia. Project has at its disposal EUR 29.248 from the donation by the Government of Great Britain
and GBP 59.518 from the donation from the Government of Netherlands. Based on this project six-
month internship in state institutions was offered for maximum of 12 graduated students or students
of Albanian, Bosniak and Roma ethnicity; young people from minority communities are encour-
aged to apply for jobs in public administration in Serbia. Project is implemented from October
2012 to April 2013.

1.2.2. Civil and political rights


Exercise and protection of the rights of convicts
Prohibition of torture and inhumane or degrading treatment or punishment
Overview
The Administration for the Execution of Penitentiary Sanctions in the period from the adoption of the
National Programme of Integration of the Republic of Serbia to the European Union has to date continued
with the implementation of the priority tasks aimed at solving the predominant problems.
With the adoption of the Law on Enforcement of Criminal Sanctions (Official Gazette Nos. 85/05,
72/09 and 31/11), which entered into force on 1 January 2006, as amended in 2009 and 2011, the national
legislation is in its greatest part harmonised with international standards in the field of criminal sanctions and
the protection of persons deprived of liberty.
The Administration for the Execution of Penitentiary Sanctions in order to prevent torture and other
forms of inhuman or degrading treatment or punishment has taken comprehensive measures relating to the
regulation of the legislative solutions guaranteeing the prohibition of torture and inhuman or degrading
treatment or punishment of persons deprived of liberty and prescribing mechanisms of protection of the
rights during the enforcement of imprisonment sentence, staff training, plan of regular supervision over the
work of the supervision department within the Administration and cooperation with the Ombudsman and
organisations for the protection of human rights that make the external control.
In 2012, effective implementation of legislation that fully accepted the European tendencies towards
constant promotion of the level of protection of the rights of convicted persons was provided, starting from
the European Convention for the Protection of Human Rights and the practice of the European Court of Hu-

45
man Rights and by incorporating in the provisions of laws the basic principles set out in European prison
rules and the Recommendations and Standards of the Committee for the Prevention of Torture and Inhuman
or Degrading Treatment or Punishment of the Council of Europe. This law for the first time introduced a
two-tier system of protection of the rights of convicts within the Administration, it provides court protection
and created the opportunity for the control by the state bodies outside the system of enforcement, as well as
independent control by various national and international organisations and bodies. It is important to note
that the functioning of the court protection system, which is done by initiating an administrative dispute, as
an independent form of control of legality of final decisions which restrict or violate any right of the con-
victed person in the first-instance and second-instance proceeding within the Administration. Protection of
the rights of convicts was provided by prison monitoring by national and international organisations as well
as by the work of the Ombudsman and National Prevention Mechanism.
In order to unburden the accommodation capacities of penal correctional facilities, the Law on Am-
nesty was passed in November 2012. The first effects of the Law are already visible, so the number of in-
mates decreased from 11,300 to 10,580 persons. It is expected that the current effect of the implementation
of the Law on Amnesty will be the release of around 1,100 convicted persons, and the total estimated effect
of the release of 4300 convicts.
In line with the Strategy to reduce the overload of accommodation capacities in the facilities for the
enforcement of criminal sanctions in Serbia in the period from 2010 to 2015 (Official Gazette of RS, Nos.
53/10 and 65/11) and the Action Plan for the implementation of the Strategy, the draft Law on Amendments
and Modifications to the Law on Enforcement of Criminal Sanctions and the Law on Probation is underway.
This harmonisation will separate the matter regulated by the Law on enforcement of criminal sanctions from
the part that regulates the enforcement of alternative sanctions.
Material conditions in prison facilities, the position of persons deprived of their liberty and strenghtening
of the alternative sanctions enforcement system
In line with the Strategy to reduce the overload of accommodation capacities in the facilities for the
enforcement of criminal sanctions in Serbia in the period from 2010 to 2015 (Official Gazette of RS, Nos.
53/10 and 65/11) and the Action Plan for the implementation of the Strategy and recommendations contained
in the report of the European Committee for the Prevention of Torture and Inhuman or Degrading Treatment
or Punishment, which was made after visiting the facilities for enforcement of criminal sanctions in the Re-
public of Serbia in the period from 1 to 11 February 2011, the Administration undertakes activities aimed at
improving the material conditions and health care in the prison facilities, conducting adequate programmes
for convicts and exercising the rights of persons deprived of their liberty.
A new facility of closed type in Padinska Skela with accommodation capacity for 450 convicts was
opened in the first quarter of 2012.
In order to ensure adequate training of prisoners, the Administration for the Enforcement of Criminal
Sanctions established, as a part of the IPA 2010 project, five production programmes (mechanical, wood,
agricultural, screen printing, baking and pastry) that will train prisoners in three largest penal correctional
institutions. As a part of this project, training was conducted for 60 trainers and 60 instructors in the facilities
that will work with 500 convicts.
In the first quarter (December 2012) The Government of the Kingdom of Norway approved a grant for
the reconstruction project of the Penal Correctional Facility for Minors in Valjevo in accordance with the
international standards.
A more detailed terms of reference for the new prison in Panevo was adopted in December 2012 and
the upcoming period will see the preparation of preliminary and main architectural and construction project,
all funded by the EU through the IPF 1 Fund.
In 2012, the EU grants financed from IPA 2007 funds were completed in the Penal Correctional Facility
in Ni (the construction of the boundary wall with watchtowers) and the Juvenile Correctional Facility in
Kruevac (new pavilions for accommodation of wards) and positive records from the committee for technical
inspection were received.
In accordance with the adopted Strategy and Action Plan, the system of enforcement of alternative
sanctions is done. The Administration undertook activities to expand the network of offices for enforcement
of alternative sanctions, so that aside from the existing seven offices, new offices are opened in 2013. Creat-
ing organisational preconditions enabled application of the sentence of community service and the condi-
tional sentence with protected supervision in the broader territory of RS. On the other hand, new alternative

46
measures and sanctions are applied (enforcement of prison sentence of up to one year without ever leaving
the premises in which the convicted person resides the so-called "house arrest" and measure to ensure the
presence of the defendant, ban on leaving the house or dwelling place - the so-called "house arrest)
throughout the territory of RS.
As part of the project for strengthening the system of alternative sanctions (IPA 2010), the Administra-
tion received electronic surveillance equipment from the EU donations, which was in early 2012 successfully
installed. A number of training sessions were conducted for staff for the use of new equipment, as well as for
the trustees who are directly responsible for the enforcement of "house arrest". The EU-funded project is un-
derway aimed to strengthen the system of alternative sanctions, as part of which in 2012, three important
components were implemented: improving the legal institutional framework, improving the methods of
work, and encouraging support in society that is necessary for a more efficient system of alternative sentenc-
ing. Trainings were organised for holders of judiciary functions with the aim of wider application of alterna-
tive sanctions and harmonisation of court practice. This project has been extended until July 2014.
The Administration for the Execution of Penitentiary Sanctions currently employs 4,430 people.
The Centre for Training and Professional Education of the Administration for the Execution of Peni-
tentiary Sanctions conducts basic and specialised trainings for employees in accordance with the curriculum
and work programme.
In addition, the Centre coordinates the implementation of training programmes and enabling prisoners
in correctional institutions to do craft activities and to take organised exams in order to get certification from
craft chambers, which will allow them to get involved in the community more easily.
The infirmaries of the Administration are, in accordance with the budget, equipped with medical
equipment, hospital rooms in prisons were renovated and more medical staff was hired. By the end of the
first quarter, new equipment for haematological and biochemical laboratory at the Special Prison Hospital in
Belgrade will be purchased. In 2012, in collaboration with the Ministry of Health the project of voluntary
and confidential counselling and testing of prisoners for HIV and the project of active screening for TB in
prisons were launched.
All penal correctional institutions were connected into a single communication and computer network.
Numerous investment activities according to the established plan and programme of work of the Ad-
ministration, in accordance with national regulations and international standards, resulted in expansion of
capacities and improvement of accommodation conditions in penal correctional institutions. The Penal Cor-
rectional Facility in Poarevac Zvezda construction of new accommodation facilities, Juvenile Correctional
Facility in Kruevac reconstruction of the water supply system, the District Prison in Belgrade and the
Special Prison Hospital reconstruction of the plumbing system, the Penal Correctional Facility Padinska
Skela replacement of external hot water installations, Leskovac District Prison rehabilitation of three
blocks, sanitary premises, works on water supply and sewerage and central heating as well as a number of
other projects of repair and reconstruction.
Priorities for 2013 with regard to harmonisation of legislation
The Draft Law amending the Law on Enforcement of Criminal Sanctions and the Draft Law on Proba-
tion will be made by the end of the third quarter. The Law amending the Law on Enforcement of Criminal
Sanctions will introduce a new institute judge for the enforcement of criminal sanctions. Court protection
of persons deprived of their liberty was secured by initiating an administrative dispute. Introducing the
judges for criminal sanctions, which will be established at the level of basic courts, will ensure a more effec-
tive judicial protection, given that they are specialised judges, and surveillance of judicial authority over the
enforcement of criminal sanctions. By passing the Law on Probation, the matter regulating the enforcement
of alternative sanctions will be separated into a separate law. This law will prescribe special procedures of
enforcement of alternative measures and sanctions in accordance with the new solutions of our penal law and
in accordance with the European probation rules.
Measures for implementation of priorities in 2013
Material conditions in prison facilities, the position of persons deprived of their liberty and enhancement
of the alternative sanctions enforcement system
- The 2013 Law on the Budget provided funds to improve the living conditions of persons deprived
of their liberty in the amount of RSD 196,500,000, so the reconstruction of the facilities continues
according to the plan and programme of the Administrations work.

47
- By the end of the third quarter, another seven offices for the enforcement of alternative sanctions
will be opened and 30 officers will be employed.
- During 2013, trainings for holders of judiciary functions with the aim of wider application of alter-
native sanctions and measures will be organised.
- By the end of the third quarter, reconstruction and construction of a facility at the Penal Correc-
tional Institution for Minors in Valjevo will start in accordance with international standards from
the grant of the Government of the Kingdom of Norway. In parallel with the reconstruction, educa-
tion and training of staff in the institution will be done for the establishment and implementation of
modern forms of treatment of minors.
- By the end of the second quarter, the work of new facilities in the Juvenile Correctional Institution in
Kruevac that were built according to European standards and financed through the IPA funds will
begin.
- The first tranche of the loan for the beginning of building a prison in Panevo is expected by end of
2013.
- By the end of the third quarter, in order to organise activities for convicts, 500 prisoners will be
trained under the IPA projects of introducing five production programmes (mechanical, wood, ag-
ricultural, screen printing, baking and pastry).
- Implementation of the project for strengthening the system of alternative sanctions, funded by the
EU, continues in 2013.
- In early 2013, IPF 3 funds are expected to be used, which will finance the creation of detailed pre-
liminary terms of reference and final architectural and project for a new prison in Kragujevac.
- In 2013, the major planned undertakings include reconstruction of the pavilion C in the Penal Cor-
rectional Facility in Ni and several blocks of the District Prison in Belgrade (2.0 and 3.0) at the re-
quest of the European Committee for the Prevention of Torture and Inhuman and Degrading
Treatment (CPT).
- Applying with IPA fund for 2013 with the project "Improving the capacities for the training, educa-
tion and employment of prisoners".
- By the end of 2013, within the project "Establishment of institutional treatment of criminal offend-
ers for the criminal act gender and sexually-based violence specialised treatment programmes will
be developed and staff will be trained for the treatment.
- By the end of 2013, the Department for Treatment and Alternative Sanctions of the Administration
will begin with the enforcement of probation with supervision, in accordance with the new solu-
tions of the Criminal Code and the Law on Probation. Establishing supervision during probation is
expected to produce wider application of this institute in judicial practice. Also, obligations set in
the pre-criminal procedure, that the prosecution may determine in order to make a decision on sus-
pension of prosecution, will be executed.
- The Administration continues with the establishment of effective health care and improving of
conditions in the Special Prison Hospital. Reconstruction of the Department for treating somatic
patients in the Special Prison Hospital in Belgrade will be completed by the end of the third quar-
ter. By the end of 2013, the Administration will procure essential medical equipment for all health-
care services in prisons. Also, in cooperation with the Ministry of Health, screening within the
active search for cases of tuberculosis and confidential and voluntary counselling and testing for
HIV and Hepatitis C will continue in 2013.
- The Law on Budget for 2013 provided funds to increase the number of employees for 141 persons,
by services: for health care 30, for treatment and alternative sanctions 30, for security 70 and 11 for
internal audit. Employment procedure will be completed by the end of the second quarter.
By applying the above measures and activities, the overload of accommodation capacities of penal
correctional facilities will be reduced, material conditions in prisons will be improved (improvement of con-

48
ditions for the enforcement of juvenile detention punishment is of special importance), a more effective ex-
ercise of the rights of persons deprived of their liberty will be provided, specialised treatment programmes
will be introduced and an effective system of enforcement of alternative sanctions will be established, which
will contribute to the humanisation of the criminal sanctions system as a whole.
Measures planned for the period 2014-2016
Priority tasks of the Administration for 2014
The Administration for the Execution of Penitentiary Sanctions made the adjustment of priority activi-
ties on the basis of the Strategy to reduce the overload of accommodation capacities in the facilities for en-
forcement of criminal sanctions in Serbia in the period from 2010 to 2015 (Official Gazette of RS, 53/10 and
65/11), the Action Plan for the implementation of the Strategy, the new legislative framework and the results
achieved so far.
- Required reconstruction of the existing facilities is done in accordance with the plan of operation of
the Administration.
- Enlarging accommodation capacities and building new facilities continues.
- Hiring new employees continues in accordance with the Regulation on the systematisation of work
places, which raises the level of the Administrations personnel training.
- Training and professional education of staff is carried out.
- Trust service has the experience in the enforcement of probation sentence with protected supervi-
sion, the sentence of community service and the so-called "house arrest", its activity was expanded
with the implementation of new alternative measures and prescribed by the Law Amending the
Criminal Code. Trust service is organised as a probation service in developed systems.
- An integrated technical protection system is promoted in these institutions and the information sys-
tem functions.
- Programmes of treatment of convicted persons according to their specific needs are carried out.
- The project for strengthening of an alternative sanctions system (IPA 2010) has been completed.
- A post-penal accommodation of convicted persons is being developed.
Priority tasks of the Administration for 2015
- The Administration for the Execution of Penitentiary Sanctions functions as a reformed system that
efficiently applies positive legislation and international standards.
- Reconstruction of buildings is done and construction of new prisons is being completed, in accor-
dance with international standards. Individualised programmes of treatment, training and work en-
gagement of prisoners are applied, as well as special programmes for juvenile offenders, effective
protection of the rights of persons deprived of their liberty is implemented, health care system is
improved, the system of healthcare protection is promoted, the system of security protection is
functional, post-penal accommodation is being developed and probation service is organised.
- The Administration is staffed for optimal enforcement of criminal sanctions.
Priority tasks of the Administration for 2016
- The problem of overload of the accommodation capacities in correctional institutions is solved. The
construction of two new prisons in Panevo and Kragujevac is completed, accommodating a total
of 900 inmates, in accordance with international standards, the probation service functions regu-
larly and post-penal accommodation is developed.
Commission for the control of criminal sanctions National Assembly
Article 278 of the Law on the Enforcement of Criminal Sanctions stipulates the obligation of the
National Assembly to set up a Commission for control of criminal sanctions, upon the proposal of the com-
petent committee.

49
The Commission shall be set up, consisting of:
- three members appointed from among the members or deputy board members that have the judici-
ary in their field of competence, and
- two members appointed from among the members and deputy board members that have in their
field of competence issues related to human rights, health and social policy.
The Commission shall be established with the task to, in controlling the enforcement of criminal sanc-
tions and detention measures, overview the situation in the field of criminal sanctions and propose measures
to eliminate irregularities and measures to improve the conditions of life, treatment and protection of the
rights of persons deprived of their liberty. In performing this control, the Commission:
The Commission submits to the National Assembly a report on the work, situation and problems in the
enforcement of criminal sanctions and detention measures and indicates the need for the adoption or amend-
ment of laws and takes other measures to protect the rights of persons against whom criminal sanctions and
detention measures are executed.
This Commission was first established in late 2011. Given that the term of office of the members of
the Commission is connected with the duration of term of office of deputies during whose convocation the
Commission is appointed, it was necessary to initiate the appointment of members of the Commission in this
convocation. The National Assembly, at its Eighth Session, on 15 December 2012, passed the Decision on
the appointment of members of the Commission for the control of criminal sanctions, which created the con-
ditions for this parliamentary working body to start working.
In line with the Strategy on Development of Mental Health Protection from 2007, during a period
of five to seven years, the development of the internal organisation of healthcare institutions should reduce
the hospital capacities in the secondary and tertiary levels of healthcare, especially in special psychiatric
hospitals, i.e., the use of these facilities for other purposes.
The Strategy on Development of Mental Health Protection stipulated the enactment of legislation on
the protection of persons with mental disabilities. In line with the Strategy, the Ministry of Health, as part of
its competences, prepared a Draft law on the Protection of Persons with Mental Disabilities. In the proc-
ess of the preparing the aforementioned draft law, which regulates the basic principles, organisation and im-
plementation of mental health care, methods and procedures, the organisation and conditions of compulsory
treatment and accommodation of mentally ill people in hospitals and other medical institutions, the Ministry
of Health conducted a public debate in four cities, Kragujevac, Ni, Novi Sad and Belgrade gathering repre-
sentatives of bodies, organisations, medical institutions, as well as all interested entities, legal entities and
individuals involved in the implementation of health care. It is expected that the said law is passed by the
Government of the Republic of Serbia in the first half of 2013.
Full participation of persons with mental disabilities is envisaged in the decision-making regarding all
rights that they are directly related to the exercise of the right to health care.
The passing of this law is in line with ECs recommendation contained in the Annual Progress Report
of the Republic of Serbia in the process of European integration for 2012, No 13.
The Minister of Health formed, in accordance with the law, the National Expert Commission for Men-
tal Health, which will address the mental health issues in the Republic.
Overview of current and planned foreign development aid
IPA project Improvement of the status of social care users who have mental disorders and improve-
ment of their social inclusion in the local community was launched in early October 2012. The main holder
of the project is the Ministry of Labour, Employment and Social Policy, while the Ministry of Health is a
partner in the project. The main objective of the project is to enable deinstitutionalisation and social inclu-
sion of people with mental health problems. The project is worth EUR 4.7 million (according to point 218 of
the Action Plan for fulfilment of the European Commission recommendations under the Serbia 2012 Pro-
gress Report in the European integration process take action to promote the inclusion of people with com-
promised mental health, in order to enable equal exercise of human rights and equal access to employment,
education and social services).
The Ministry of Health is included in the project Improvement of the status of social care users who
have mental disabilities and improvement of their social inclusion in the local community IPA project
whose holder is the Ministry of Labour and Social Policy.

50
The project should have the following results:
1.A transformation plan for 13 social and 5 specialised psychiatric institutions and a development
plan for inter sectorial social and medical services in the local community.
2.Implementation of the Plan of Transformation and Development Plan by way of building capaci-
ties at the national and local levels through improved range and quality of inter sectorial services
for de-institutionalisation of persons with mental disabilities.
3.Support to the production of the Scheme of Donations to provide social and medical services in the
local community.
Deadline: 3rd quarter of 2013.
Prohibition of slavery, servitude and forced or compulsory labour
Overview
Prohibition of slavery, servitude and forced or compulsory labour is regulated in Article 26 of the
Constitution of the Republic of Serbia (Official Gazette of RS, No 96/2006).
The Law on the Prohibition of Discrimination (Official Gazette of RS, No 22/09) defines slavery,
human trafficking, apartheid, genocide and ethnic cleansing as severe forms of discrimination (Article 13,
paragraph 4). It is forbidden to deny rights or to grant privileges, be it publicly or covertly, pertaining to gen-
der or gender change. It is forbidden to practise physical violence, exploitation, express hatred, disparage-
ment, blackmail and harassment pertaining to gender, as well as to publicly advocate, support and practise
conduct in keeping with prejudices, customs and other social models of behaviour based on the idea of gen-
der inferiority or superiority; that is, the stereotyped roles of the genders (Article 20, paragraph 2).
It should be emphasised that the Constitution of the Republic of Serbia (Article 16) provides that the
generally accepted rules of international law and ratified international treaties are an integral part of the legal
order of the Republic of Serbia and are applied directly. In this regard, we note that the Republic of Serbia
has ratified a series of relevant conventions of the International Labour Organisation (ILO), of which the
most important ones include: ILO Convention No 29 on forced labour and ILO Convention No 105 concern-
ing the abolition of forced labour. Reports on the implementation of these conventions in the Republic of
Serbia were submitted in September 2011 to the International Labour Organisation.
Measures for implementation of priorities in 2013
The approximate schedule of regular reporting to the International Labour Organisation envisages re-
porting in 2013 on the implementation of the mentioned conventions in the Republic of Serbia.
Right to marry and right to found a family
Overview
The right to marry and found a family is regulated by the Law on Family (Official Gazette of RS, No
18/2005), the Law on Financial Support to Families with Children (Official Gazette of RS, No 16/2002,
115/2005 107/2009) contributes to the overall measures of social child welfare, and aims to improve the
conditions for meeting the basic needs of children, special incentives for childbirth, etc. In 2012, two Instruc-
tions were made and distributed (to local governments and social welfare centres) for use of accompanying
rulebooks along with this law.
The passing of the Law on Social Protection (Official Gazette of RS, No 24/2011) gave a strong im-
petus to the development of community services intended for families, especially families with children with
developmental disabilities, the concept of accessibility and territorial distribution. Currently, according to
data of the Republican Social Protection Institute, there are 44 support services in the Republic of Serbia,
designed to support family, which are financed from the local budgets, thus ensuring their sustainability.
Measures for implementation of priorities in 2013
The Rulebook amending the Rulebook on conditions, procedure and manner of exercising the right to
be absent from work for special child care in order to improve the position of parents of children with devel-
opmental disabilities should be adopted in the first half of 2013.
An analysis of the effects of the implementation of measures of the Strategy to encourage procreation
aimed at determining the need to amend existing measures that have not yielded satisfactory effect against
low birth rate in the Republic of Serbia should be created. Also planned is an analysis of the application of

51
the Law on Financial Support for Families with Children with the aim of revising the existing rights to the
child allowance and better ways to help families with children.
Support to local governments in the development of community services intended primarily for fami-
lies with children is planned throughout 2013, with an emphasis on families with children of low growth and
children with developmental disabilities.
Measures planned for the period 2014-2016
Continued activities and strong support to local governments to develop services intended to families
through the establishment of earmarked transfers from the national level for the development of services,
especially to the poorest municipalities.
The goal is to make the services for families and children to all users who need them available.
Freedom of thought, conscience and religion
Overview
In the field of freedom of thought, conscience and religion, the Law on Churches and Religious Com-
munities is in power in 2012 (Official Gazette of RS, No 36/06), and in order to implement this law, the
Rulebook on contents and manner of keeping the Register of churches and religious communities was passed
(Official Gazette of RS, No 64/06). 24 churches and religious communities and 364 organisational units of
churches and religious communities as legal entities were registered in the Register of churches and religious
communities by September 2012.
In terms of the legal status of churches and religious communities, the Law governs their autonomy,
which, among other things, includes the possibility that churches and religious communities may change
their regulations and abolish their organisational units, bodies and institutions that have the status of legal
entities. The law stipulates that churches and religious communities, as well as their internal organisational
units, get the legal personality upon their entry into the Register kept by the competent ministry. Acquisition
of legal personality, however, is determined differently for different categories of churches and religious
communities. Namely, the law gives legal personality to traditional churches and religious communities,
which are defined as those with centuries-long historical continuity and whose legal status in the past was
regulated by special laws, while for all other churches and religious communities, including those whose le-
gal status was governed by the laws in force in the former Yugoslav state, the law provides for the submis-
sion of requests to be decided upon in a separate administrative proceeding.
The process of registration of new churches and religious communities in the Republic of Serbia is
very easy and simple. The Law on Churches and Religious Communities provides that in addition to the re-
quest for registration, the Statute, the Decision on the establishment, an overview of religious teachings and
the data of a permanent source of income, a church or a religious community may be established by at least
100 members or 0.001% of the adult population, Serbian or foreign nationals with permanent residence in
the territory of the Republic of Serbia, so the possibilities for establishing new churches and religious com-
munities are large and viable.
With regard to the situation in the institutional and administrative sense, we point out that the 2012
Law on Ministries provided that the Government would, for the conduct of activities related to issues of im-
portance for churches and religious communities, establish a separate service. The same law provides that the
Ministry of Justice and Public Administration shall carry out public administration tasks related to the main-
tenance of the register of churches and religious communities and the preparation of regulations on churches
and religious communities.
Administrative capacities
The Office for Churches and Religious Communities of the Serbian Government was established
through the Regulation on the Office for Churches and Religious Communities that was passed on 2 August
2012. According to the Regulation, the Office shall perform technical tasks related to: promotion and devel-
opment of freedom of religion, cooperation between the state and churches and religious communities and
improvement of their position in society, promotion of religious grounds and contents of the Serbian national
identity, helping to protect the religious component in the cultural and ethnic identity of national minorities,
cooperation of the state with eparchies of the Serbian Orthodox Church abroad, development and promotion
of the value of religious culture, development of religious education and support in the education system,
providing support and assistance to the sacral building and protecting the church cultural heritage, helping in
the protection of the legal and social status of churches and religious communities, exercising their legal

52
rights, regulation and improvement of the socio-financial status of holders of religion (cleric monks, reli-
gious officials and students of religious schools).
Freedom of expression and media freedom
Overview
In September 2011, the Government of the Republic of Serbia adopted the Strategy for the Develop-
ment of the Public Information System in the Republic of Serbia, laying down guidelines for the develop-
ment of public information system in the Republic of Serbia until 2016, with the aim of further strengthening
of established democratic relations in that area.
The strategy is based on the Constitution of the Republic of Serbia, standards, experience, democratic
regulatory framework, and the most important commitments of the United Nations, the Council of Europe
and the European Union contained in the documents setting the freedom of expression and access to infor-
mation and their free flow and exchange as one of the main human rights.
Implementation of the Action Plan Strategy will fully implement the recommendations contained in
the Commission's Annual Progress Report for the RS in the process of European integration.
Currently the public information system in the Republic of Serbia is regulated by laws and the by-
laws, which in a general and comprehensive manner regulate this area. These are the following acts:
- The Law on Public Information (Official Gazette of RS, Nos. 43/2003, 61/2005, 71/2009, 89/2010
- decision of the Constitutional Court and 41/2011 the Constitutional Court) that is based on the
European Convention on Human Rights (Council of Europe, The European Convention on Human
Rights, Rome 4 November 1950 and its Five Protocols);
- The Law on Broadcasting (Official Gazette of RS, 42/2002, 97/2004, 76/2005, 79/2005 - other law,
62/2006, 85/2005 and 41/2009) which will be harmonised with the Audio-visual Media Services
Directive (Directive 2010/13/EU of the European Parliament and of the Council of 10 March 2010
on the coordination of certain provisions laid down by law, regulation or administrative action in
Member States concerning the provision of audio-visual media services Audio-visual Media Ser-
vices Directive CELEX No 32010L0013);
- Law on the Ratification of the European Convention on Transfrontier Television (Official Gazette
of RS International Treaties, 42/2009);
- The Law on Public Enterprise News Agency Tanjug (Official Gazette of FRY,11/1995);
- The Law on Public Enterprise News Publishing Company Panorama (Official Gazette of RS,
80/1992);
- The Law on Federal Public Institution Radio Yugoslavia (Official Gazette of RS, 3/2002);
Priorities for 2013 with regard to harmonisation of legislation
In order to implement the Action Plan of the Strategy, an expert working group of the Ministry of Cul-
ture and Information (which, as observer members, also comprises representatives of the Delegation of the
EU and OSCE) started working on media laws and the Law on Public Information, the Law on Electronic
Media and the Law on Public Services. The working group of the Ministry of Culture and Information will
deliver the agreed-on texts of the laws with an explanation, which should enter the parliamentary procedure
in April 2013.
Harmonisation of legislation with EU regulations governing this area is ongoing.
- The EU regulation in this area, with which domestic regulations are harmonised, includes the Au-
dio-visual Media Services Directive (Audio-visual Media Services Directive CELEX
32010L0013) and the Recommendation on the protection of minors. EU standards in the field of
media include the following documents:
- Protocol on the system of public broadcasting in the Member States (The Treaty on the Functioning
of the European Union PROTOCOLS Protocol (No 29) on the system of public broadcasting in the
Member States CELEX 12010E/PRO/29)
- Communication from the Commission on the application of State aid rules to public service broad-
casting (Communication from the Commission on the application of State aid rules to public ser-
vice broadcasting CELEX 52009XC1027(01)

53
- Decision on the programme of the media (Decision No 1718/2006/EC of the European Parliament
and of the Council of 15 November 2006 concerning the implementation of a programme of sup-
port for the European audio-visual sector (MEDIA 2007) CELEX 32006D1718)
- Communication on the principles for the Community's audio-visual policy (Communication from
the Commission to the Council, the European Parliament, the Economic and Social Committee and
the Committee of the Regions Principles and guidelines for the Community's audio-visual policy in
the digital age CELEX 51999DC0657)
- Decision on interactive media content (Council Resolution of 19 December 2002 on interactive
media content in Europe CELEX 32003G0118(03))
- Recommendation on the protection of minors and human dignity (Recommendation of the Euro-
pean Parliament and of the Council of 20 December 2006 on the protection of minors and human
dignity and on the right of reply in relation to the competitiveness of the European audio-visual and
on-line information services industry CELEX 32006H0952)
- Recommendation on the development of competition; Resolution on enhanced information ex-
change (Council Resolution of 23 July 2001 on exchange of information and experience concern-
ing conditions for professional artists in the context of EU enlargement CELEX32001G0731(01))
- Conclusion on the application of recommendations concerning the protection of minors (Report from
the Commission to the European Parliament, the Council, the European Economic and Social Com-
mittee and the Committee of the Regions on the application of the Council Recommendation of 24
September 1998 concerning the protection of minors and human dignity and of the Recommendation
of the European Parliament and of the Council of 20 December 2006 on the protection of minors and
human dignity and on the right of reply in relation to the competitiveness of the European audio-
visual and online information services industry-protecting children in the digital world -
CELEX52011DC0556).
Administrative capacities
Under the Law on Ministries, the Media Department takes care of the development and improvement
of the system of public information. Fourteen employees are engaged on those jobs, as part of two narrower
organisational units: The Department for legislative affairs, media pluralism and accreditation of foreign cor-
respondents and bureaus and the Department for European integration in the field of information and culture.
Overview of current and planned foreign development aid
The Ministry of Culture and Information is currently working with the EU Delegation on drafting the
project proposal for IPA 2012 project Strengthening media freedom, worth EUR 3.2 million, which aims
to strengthen freedom of expression, the democratisation of the media and implementation of EU standards
in the domain of the media through the support to the implementation of the Strategy for the Development of
the Public Information System in the Republic of Serbia until 2016.
Freedom of assembly and association
Overview
The Constitution of the Republic of Serbia in Article 54 provides that the citizens may assemble
freely. Assembly held indoors shall not be subjected to permission or registering. Gathering, demonstrations
and other forms of assembly held outdoors shall be reported to the state body, in accordance with the law.
Freedom of assembly may be restricted by the law only if necessary to protect public health, morals, rights of
others or the security of the Republic of Serbia.
The Ministry of the Interior prepared a new Draft Law on Public Assembly which is currently in the
process of adoption. The new draft law is consistent with the Constitution of the Republic of Serbia and con-
tains modern conceptual solutions. An expert of the Venice Commission participated in the working group
for analysing the legal framework on freedom of assembly in Serbia, so the work of this working group re-
sulted in recommendations for regulating the right to freedom of assembly in the Republic of Serbia and the
mentioned draft law is mainly in compliance with these recommendations. Also, the draft law is in compli-
ance with Article 12 of the Charter of Fundamental Rights of the EU relating to freedom of assembly and
association.

54
It is expected that a new Law on Public Assembly will be adopted during 2013, which will fully re-
move all the inconsistencies and ambiguities that occurred in the application of the law by the competent au-
thority.
The 2006 Constitution of the Republic of Serbia guarantees the freedom of association as one of fun-
damental human rights and freedoms. The Constitution in Article 55 guarantees freedom of political, union
and any other form of association, as well as the right to stay out of any association, and that associations
shall be formed without prior approval and entered in the register kept by a state body, in accordance with
the law.
The Law on Political Parties (Official Gazette of RS, No 36/09), which was adopted on 12 May 2009
and came into force on 23 July of the same year, establishes the foundation and the legal status of political
parties, entry and removal from the register, the cessation of political parties and other issues important for
political parties.
Trade union organising
Overview
The right to trade unions and employers association and action in the Republic of Serbia is guaranteed
by international treaties, the Constitution, laws and by-laws, and collective agreements.
ILO Convention No 87, which was confirmed by the Regulation on ratification, set the principles that
workers and employers, without distinction whatsoever, shall have the right, without prior approval, to form
organisations of their own choosing, and to join these organisations, under the only condition to abide by
their respective statutes. Workers and employers organisations shall have the right to pass their own statutes
and administrative rules, to freely choose their representatives, to organise their management and activities
and to formulate their action programmes. The public authorities shall refrain from any intervention of a na-
ture that would aim to restrict this right or interfere with the legal enforcement thereof. Article 16 of the
Constitution of the Republic of Serbia provides that the generally accepted rules of international law and rati-
fied international treaties are an integral part of the legal order of the Republic of Serbia and are applied di-
rectly.
Article 55 of the Constitution of the Republic of Serbia guarantees freedom of political, trade union or
any other association and the right to stand out of any association. Associations shall be formed without prior
approval and entered in the register kept by a state body, in accordance with the law. Secret and paramilitary
associations shall be prohibited. The Constitutional Court may ban only such associations the activity of
which is aimed at violent overthrow of constitutional order, violation of guaranteed human or minority
rights, or inciting of racial, national and religious hatred.
Under the Law on Labour (Official Gazette of RS, Nos. 24/05, 61/05 and 54/09), a trade union may
be established in accordance with the general act of the trade union. The conditions for the establishment and
operation of trade unions are not regulated by law, but by statutes of those organisations. Under the law, the
employers' association may be established by employers employing at least 5% of employees in relation to
the total number of employees in a certain branch, group, subgroup, or business activity, i.e., the territory of
a particular territorial unit.
Once the trade union and employers' association is founded, it must be entered into the register kept by
the ministry in charge of labour affairs, since it acquired legal personality starting from the date of register-
ing (Articles 217 and 238 of the Labour Law).
Police and military personnel shall be entitled to the right to trade union organisation. Pursuant to Ar-
ticle 14, paragraph 3 of the Law on Serbian Armed Forces (Official Gazette of RS, Nos. 116/07, 88/09 and
101/10) professional military personnel shall be entitled to the right to trade union organisation, in accor-
dance with the Government regulations. Trade unions and employers' associations shall be deleted from the
registry when they no longer meet the requirements for establishment, or at the request of the organisation.
The banning of these organisations may be decided by the Constitutional Court in cases prescribed by Article
55 of the Constitution.
Priorities for 2013, with the projections for the period 2014-2016
With the aim of implementing legislation on the prevention of all forms of discrimination, the Ministry
of Labour, Employment and Social Policy will in the future provide more efficient and consistent implemen-
tation of the Law on Labour (Official Gazette of RS, Nos. 24/05, 61/05 and 54/09), and in particular the pro-
visions on the prohibition of discrimination, harassment and sexual harassment, through the work of the

55
Labour Inspectorate. By amending this law, the existing provisions will be amended also in the part related
to the burden of proof in cases of discrimination, in accordance with the relevant regulations of the European
Union.
It is also planned to pass an Action Plan for the promotion of social dialogue to define the guidelines
and actions to ensure the promotion of social dialogue, increase the number of concluded collective agree-
ments and efficiency of work of social and economic councils.
For more information on planned legislative activities, please see Chapter 19.
Civil society
Overview
The National Assembly of the Republic of Serbia adopted in 2009 the Law on Associations (Official
Gazette of RS, 51/09), which regulates the constitutionally guaranteed freedom of association and represents
a sound legal framework for the establishment, operation and activities of domestic and foreign associations
in the Republic of Serbia. The provisions of the Law largely stimulate the development of civil society or-
ganizations in Serbia, since the association is defined as a voluntary, non-governmental, non-profit organisa-
tion, based on freedom of association of more individuals or legal entities, established for the purpose of
achieving and improving a common or general purpose or interest which are not prohibited by the Constitu-
tion or law. In November 2010, the Law on Endowments and Foundations was adopted, which allowed the
creation of a legal framework stimulating for the development of endowments and foundations, and their
transparent management and operations. Under the Law on Associations (Article 38), the Government
passed the Regulation on funds intended to incentivise programmes or matching grants for funding pro-
grammes of public interest implemented by associations (Official Gazette of RS, 8/12), which regulates by
the criteria, conditions and methods of allocation of funds from the budget of Republic of Serbia to associa-
tions, which provides for the allocation of funds to be transparent and evens the procedures of awarding fi-
nancial support to civil associations and other civil society organisations by government institutions at the
republic level, the provincial budget and at the local self-government unit level.
The institutional framework for the systematic and continuous dialogue with civil society was estab-
lished in January 2011, with the establishment of the Office for Cooperation with Civil Society. The estab-
lishment and the scope of the Office are defined by the Regulation on the establishment of the Office for
Cooperation with Civil Society (Official Gazette of RS, 26/10).
Priorities for 2013 with regard to harmonisation of legislation and measures planned for the
period 2014-2016
Priority measures and activities of the Office in the future relate to the legal, strategic and financial
framework, and mechanisms of communication and cooperation. Improving the legal, strategic and financial
framework which includes the following measures and mechanisms for communication and collaboration:
- Proposals to amend the law in order to create an enabling environment for civil society, and initiat-
ing laws governing standards of cooperation between civil society and state institutions, and stan-
dards of participatory process with civil society in drafting legislation;
- Development and adoption of the National strategy for the creation of an enabling environment for
the civil society development, in order to define long-term problems of civil society organisations
(CSO) in Serbia, indicate the limiting factors for the development of SCOs, define the needs of
civil society, directions of development;
- Improving regulation and transparent funding mechanisms;
- The annual Overview reports on the programmes and projects of association and other CSOs fi-
nanced from the national budget and the budgets of the autonomous province and local self-
governments;
- Procedures for the co-financing of EU projects;
- Establishment of the Council for development and cooperation with civil society, as well as institu-
tional framework for making and monitoring the implementation of the National strategy;
- Organizing training and other forms of support for representatives of state institutions on the im-
portance of cooperation with civil society in the drafting and implementation of measures;

56
- Organisation of trainings for civil society organisations in connection with participation in the pro-
gramme Europe for citizens, participation in programming and the use of EU pre-accession funds
to support civil society and the structure of the EU accession negotiations;
- Mechanisms of regular cooperation with CSOs and partners (ministries, National Assembly of
Republic of Serbia, donors, university, the media);
- Coordination of aid and donor advisory groups.
In order to promote civil society and to have constructive dialogue and cooperation with the national
authorities, the adoption of an action plan for increasing the visibility of civil society organizations and pub-
lic confidence in their work is planned.
Overview of current and planned foreign development aid
The Office for Cooperation with Civil Society is the user of technical assistance under the Civil Soci-
ety Support Programme IPA 2011-2013, in the total amount of EUR 1,200,000. As part of the project, activi-
ties related to the creation of an enabling environment for the development of the civil society, strengthening
institutional capacity and management of the Office of the management of funds allocated to civil society
organisations in the Civil Society Support Programme IPA 2012 and IPA 2013, will be implemented.
Right to education
As regards the right to education, the legislative framework is rounded and harmonised with interna-
tional standards: The Law on the Foundations of Education and Upbringing (Official Gazette of RS, Nos.
72/2009 and 52/2011) and the Law on Higher Education (Official Gazette of RS, Nos. 76/2005, 100/2007,
97/2008, 44/2010 and 93/2012). In the upcoming period, legal framework will be further developed for effi-
cient implementation.
The Law on the Foundations of Education and Upbringing (Official Gazette of RS, Nos. 72/09 and
52/11) regulates that all citizens on equal terms members of nations and national minorities, foreigners and
stateless persons, people with special abilities, people from socially vulnerable groups and those with special
needs and disabilities have the right to quality education free of charge in educational institutions founded by
the Republic, autonomous province or local self-government.
Persons who acquired foreign school certificates may have these documents equated with the corre-
sponding public document in the Republic of Serbia, in the process conducted by the Ministry of Education,
Science and Technological Development in the case of primary and secondary education, and under the Law
on Higher Education, independent higher education institutions shall be in charge of the procedure for rec-
ognition of foreign higher education documents.
For more information about the education system and the legislative activity, please see Chapter 26.
Right to property
This question is done as part of Chapter 23.
Gender equality and women's rights
Overview
Given that it is one of the Contracting Parties of the UN Convention on the Elimination of All Forms
of Discrimination against Women (CEDAW), the Republic of Serbia prepared its Second and Third periodic
report on the state of women's rights and achieving gender equal opportunities policy, whose presentation is
planned for May 2013 at the session of the UN Committee in charge of this matter.
By applying the National Strategy for Prevention and Elimination of Violence Against Women in the
Family and Intimate Partner Relationship from April 2011 (Official Gazette of RS, No 27/11), the Republic
of Serbia on 4 April 2012 signed the Council of Europe Convention on preventing and combating violence
against women and domestic violence since 2011. Preparations are under way for the ratification of the
Convention.
Starting of the National Strategy for Improved Status of Women and Gender Equality Promotionand
the Action Plan along with the Strategy from 2009 and 2010 (Official Gazette of RS, No 15/09 and 67/10),
the following was achieved: 1) guidelines checklists and training materials were made for decision-makers in
the public administration and political parties, trade unions and employers' associations on implementation
and compliance with gender equality, 2) an on-line course on gender equality in public services was devel-
oped, 3) a study was made on the position of women from the double and multiple discriminated groups to

57
participate in public and political life, 4) methodology to monitor the equal participation of underrepresented
gender in local self-government units to identify examples of good practice.
Priorities for 2013 - in more detail in Chapter 19
Overview of measures for the period 2014-2016 - in more detail in Chapter 19
Rights of the child
Overview
Under the Law on Family (Official Gazette of RS, No 18/2005), the criteria of legal intervention are
reduced to general law standards, including the best interests of the child and autonomy of a family. By-laws
regulate the organisation, standardisation of basic social services, the keeping of a single register of adoption,
keeping records and documents on adopted children, detailed conditions for foster care, keeping records of
persons under custody, etc.
The efforts of the Republic of Serbia in the promotion of children's rights continued. A strong contri-
bution is the adoption of the Law on Social Protection (April 2011), which sets out the rights of users and
social services as children and young people, adults and the elderly. For the first time, the users of the social
protection also include: children at risk and children victims of abuse, neglect and exploitation, the children
victims of human trafficking, and children foreign nationals victims of trafficking. The law prohibits the ad-
mission of children aged 0-3 years in social care institutions for the accommodation of children.
Also, the Government adopted the General protocol on procedures and cooperation of institutions,
authorities and organisations in situations of domestic violence against women and partner relation-
ships violence in November 2011. This protocol, which is effective from the date of its adoption, for the first
time in a national document, explicitly defines that the child is considered a child victim of violence if hav-
ing witnessed domestic violence, bearing in mind the consequences of violence: Children are considered
victims of family violence not only when they suffer it directly, but also when they are exposed to acts of
violence by one member of the family against other members as witnesses.
In the field of education, safety in institutions of education and protection from violence and abuse are
the basic rights of children, who are especially protected. Although in this matter, the legal framework is
harmonised with international standards and a series of activities was developed related to the implementa-
tion of legal provisions, the protection system is constantly evolving through:
- Support to institutions in the implementation of existing legislation and regulations governing the
protection of children from violence, abuse and neglect, the organisation of conferences, meetings
of schools, strengthening the network of mentors and staff training.
- Maintenance of help-lines for reporting violence in schools (continuing training of new profession-
als, the definition and implementation of procedures and engagement and close cooperation with
the inspection services).
- Training of teams for crisis interventions.
- The research of digital violence and use of the obtained data to plan training for teachers, students
and parents; implementation of activities to prevent digital violence.
- Training of employees in the education system (teachers, associates and educational counsellors in
school management) for the prevention of gender-based violence, with a special look back at the
prevention of peer sexual violence.
When it comes to children and students with disabilities, disorders and learning difficulties, based
on the Law on the Foundations of Education and Upbringing, a series of by-laws that enable the implementa-
tion of inclusive practice in education was passed. Free pre-school education and education for children with
special needs and disabilities is achieved within regular educational groups, where the number increased by
240 against the previous 2010/2011 year and special, development groups (up to 6 children), a total of 40 out
of 258 children in the Republic of Serbia, as well as for long-hospitalised children within 90 hospital groups
(a total of 1,600 children in 2011/2012). An individual educational curriculum is prepared for children in
special groups. The number of children and students with special needs and disabilities increased considera-
bly in regular schools, starting from 2010/2011, or by more than 5%. During the previous year, trainings for
teachers were organised to prepare them and to raise the level of their competences for applying the instru-
ments and measures that ensure equal conditions of education to these students too. Although necessary

58
measures for the smooth implementation of the Law were taken (by-laws were passed, manuals and expert
guidelines were prepared, a support network was established for employees in kindergartens and schools),
combating prejudices of employees, lack of information of parents about their children's rights in the educa-
tional system, prejudices of part of parents of children without disabilities as well as peers themselves. The
occurrence of discrimination of this population at all levels of education is still evident and reactions follow
once it becomes visible. A lack of funding for financing support services at the local level and assistive tech-
nologies produces great difficulty.
As for the Roma, a series of measures in the field of education were carried out, which led to encour-
aging results at all levels of education. Activities of importance in the future (they also refer to other catego-
ries of children from vulnerable groups) will focus on maintaining and increasing the coverage; reinforced
monitoring of work of interagency committees; expanding the network of pedagogical assistants (it is esti-
mated that about 400 pedagogical assistants are needed) whose training is funded from the IPA 2012 funds,
but the funding for their salaries depend on the budget capacities, training educational advisors in school
boards for regular monitoring of Roma education and preparing the easily usable materials (for instance,
check list), and procedures of application and reporting; institutional establishment and monitoring the co-
operation between regular and special schools to provide support, as needed, of defectologists to regular
schools; determining specific weights for the Roma students; initiating the action of providing free textbooks
for the Roma higher grades students.
National minority rights in education are exercised in accordance with the expressed interest and in
cooperation with the national councils.
Members of the Albanian national minority in Serbia's southern municipalities receive education in
their mother tongue at all levels: pre-school programme is implemented in 19 groups in the pre-school insti-
tution in Bujanovac, in six primary schools and one secondary school, the departments of Law and Econom-
ics faculties in Medvea (University of Ni) and the Bujanovac Department of the Faculty of Economics in
Subotica (University of Novi Sad). Both textbooks printed in the Republic of Serbia and textbooks that are,
with the approval of the Minister of Education, Science and Technological Development, imported from Al-
bania are used in teaching.
Evaluation is underway for textbooks in Bosnian language and their compliance with the curriculum
for the subject Bosnian language for the first and fifth grade of primary education and the first year of high
school and vocational school.
The Ministry of Education, Science and Technological Development recommended by the Institute for
the Advancement of Education and Upbringing to prepare a programme of final exam in the Bulgarian lan-
guage for the school 2013/2014 year.
The proposal of the programme for the elective programme Czech language with elements of national
culture for the second, third, fourth, fifth and sixth grades of primary school was submitted to the National
Education Council for adoption at the proposal of the Institute for the Advancement of Education and Up-
bringing and the Provincial Secretariat for Education, Administration and National Communities.
The National Council of the Romanian ethnic minority launched an initiative to organise the teaching
of the Romanian language with elements of national culture in 7 schools in the territory of the School Ad-
ministration in Zajear, but there was little interest by the parents, and the issue was deferred to the next pe-
riod.
Pursuant to the provisions of the Rulebook on issuing low-circulation textbook (Official Gazette of
RS, No 30/2010), a total of RSD 22,953,318.15 was collected in the school year 2012/2013. These funds
were distributed to six publishers with licences that in their publishing plans had the publication of low-
circulation textbooks.
Priorities for 2013
Preparation of the second and third periodic report on the change of the Convention on the Rights of
the Child is ongoing, which will be delivered to the UN Committee on the Rights of the Child in the first
quarter of 2013.
Also, throughout the whole 2013 the activities will be stepped up for the enforcement of the legal pro-
vision contained in the law on social protection banning placement of children aged 0-3 years in social care
institutions. These activities include all relevant stakeholders, with an aim to support the development of ser-
vices in the community for parents and foster care, especially for children with disabilities.

59
The plan includes continuation of activities aimed at the protection of children from violence, imple-
mentation of the National strategy for the Prevention and the Protection from Child Abuse, but also the im-
plementation of activities on application of the Lanzarote Convention of the Council of Europe.
In the second half of 2013, it is planned to start production of the new Social Protection Development
Strategy for the period 2013-2020 and a significant portion of this document will be directed to the protec-
tion of children's rights, support for families with children, continuation of deinstitutionalisation and devel-
opment of foster care.
For more information about the education system and the legislative activities, please see Chapter 26.
Overview of measures for the period 2014-2016
Improving the policy of protecting the rights of the child by strengthening inter-sectoral cooperation,
especially in the field of protection from violence and inclusion of children with disabilities, as well as fur-
ther capacity reductions in homes for children with disabilities. Improving access to services for children and
families and material support to poor families with children.
The right to a fair trial
Overview
As for the current situation, it is important to note that notwithstanding the absence of a special legal
framework, there are different groups of providers of legal aid. The possibility of legal assistance by these
organisations stems from Article 67 of the Constitution of the Republic of Serbia, which establishes the obli-
gation of lawyers and legal aid services in local governments to provide legal assistance. Legal aid services
in local government are particularly important bearing in mind the dominant needs of population for primary
legal aid. These services have a big scope of action, bearing in mind the number of legal issues covered by
their work and wide availability in relation to a very large number of potential and actual users. The Bar As-
sociation is an indispensable pillar of secondary legal aid. The Association has an adequate professional ca-
pacity and in some cases it provides pro bono legal assistance to the poor. Non-governmental organisations
are a group of providers of legal aid, which is of great importance for specific vulnerable and marginalised
groups. These organizations have the technical capacity, organisational infrastructure and the possibility to
approach users and over time they have narrowly specialised for certain legal matters, i.e., groups of users.
NGOs are the only providers who, through help-lines, provide legal aid. For some categories of users (such
as victims of domestic violence, persons with disabilities, etc.), this support is key towards the exercise of
their rights. With their specialisation and engagement of experts in different fields, legal clinics are an irre-
placeable resource of knowledge and legal aid for certain categories of vulnerable groups (for example, vic-
tims of domestic violence, persons with disabilities, refugees and displaced persons, Roma). Legal clinics at
state law schools in the Republic of Serbia have satisfactory personnel, spatial and technical facilities for in-
clusion into the future institutional system of free legal aid and, with appropriate organisational adjustments
and adequate work organisation, they can become providers of quality legal assistance up to the level of rep-
resentation (giving legal information, providing legal advice and composing submissions). Also, low-income
people have a right to free legal assistance in accordance with the Law on Criminal Proceedings within the
standards that define indigence and mandatory defence.
In order to regulate more precisely the exercise of the right to free legal aid and a more adequate ac-
cess to justice, the Government of Serbia adopted the Strategy for the Development of Free Legal Aid in the
Republic of Serbia in 2010, laying down the basic principles and guidelines for future legal and institutional
framework of the free legal aid. In 2011, the Ministry of Justice set up a working group for drafting the Law
on Free Legal Aid, with the participation of representatives of lawyers, NGOs, law school, the ministry and
service of free legal aid. The work on this law is supported by the Justice Sector Support Multi Donor Trust
Fund (JSS MDTF) as part of the component of access to justice. The working group for drafting the Law on
Free Legal Aid in January 2012 finished work on the final draft law, which was submitted to the Council of
Europe for expertise. Finally, in accordance with the Strategy of development of free legal aid in the Repub-
lic of Serbia, the Council for the implementation strategy was set up.
The work on the Law on Free Legal Aid is accompanied by a simultaneous exchange of information
with a working group of the World Bank that analyses the prosecuting of criminal cases in criminal law sys-
tem of the Republic of Serbia. The findings of this study will indicate further steps towards a more effective
processing of cases and a more successful connecting of individuals with an adequate level of legal assis-
tance and representation throughout the whole criminal proceedings. The results of the study are available to

60
the working group for drafting the Law on Free Legal Aid with a view of harmonising the possibility to
submit the request for exercising the right to free legal aid. In late 2012, the Ministry of Justice and Public
Administration made significant changes to important judiciary law, where the future Law on Free Legal Aid
was taken into account, allowing the law to be applied after the adoption, without the need to perform subse-
quent adjustments of regulations.
Priorities for 2013 with regard to harmonisation of legislation:
The final working version of the Law on Free Legal Aid will be completed based on the expertise of
the Council of Europe, by amending certain provisions in order to comply with the views of experts. It is ex-
pected that the final text, after consultation with the relevant ministries, will be adopted in the second quarter
of 2013. The timing of future planned activities will depend on this activity. The working group will con-
tinue its work on developing by-laws related to the practical application of the new law on free legal aid. One
of the main priorities during the first half of 2013 is the provision of relevant updated data for assessing the
costs of the free legal aid system to the World Bank. This report will be submitted to the competent minis-
tries of the Republic of Serbia. Also, an analysis of the framework number and the existing needs of vulner-
able groups, with a special overview of the possible increase in the number of asylum seekers will be carried
out in early 2013. After the adoption of the law, the beginning of promotional activities and providing infor-
mation to the public on the law on free legal aid is planned. At the same time, they will also work on devel-
oping a plan for training of providers of free legal aid in connection with the beginning of enforcement of the
law. One of the main priorities is the development of a comparative analysis of the systems of the countries
in the region and the EU regarding the method of payment of mandatory defence and experts, in order to in-
form the analysis on the costs of the free legal aid. As for the right to a fair trial and access to justice, a po-
tential amendment of Article 77 of the Law on Criminal Proceedings is of importance, allowing for greater
guarantees of exercising the right to a fair trial, especially when it comes to people who do not have enough
resources to provide the defence.
In developing the working version of the Law on Free Legal Aid, the working group took into account
the following relevant documents with the aim of a partial or complete alignment, depending on possibility
to apply it in the legal system of the Republic of Serbia:
1.Council Directive 2002/8/EC of 27 January 2003 to improve access to justice in cross-border dis-
putes by establishing minimum common rules relating to legal aid for such disputes (32003L0008
Council Directive 2002/8/EC of 27 January 2003 to improve access to justice in cross-border dis-
putes by establishing minimum common rules relating to legal aid for such disputes) cross-border
disputes, limited to civil and commercial matters;
2.Commission Decision of 9 November 2004 establishing minimum common rules relating to legal
aid for such disputes; (32004D0844 2004/844/EC: Commission Decision of 9 November 2004 es-
tablishing a form for legal aid applications under Council Directive 2003/8/EC to improve access
to justice in cross-border disputes by establishing minimum common rules relating to legal aid for
such disputes (notified under document number C(2004) 4285)
3.Commission Decision establishing a form for the transmission of legal aid applications;
(32005D0630 Commission Decision of 26 August 2005 establishing a form for the transmission of
legal aid applications under Council Directive 2003/8/EC)
4.Council Framework Decision of 15 March 2001 on the standing of victims in criminal proceedings
32001F0220 (Article 6 Specific assistance to the victim)
5.The European Charter of Fundamental Rights 32000X1218(01) (Article 47 Right to an effective
legal remedy and to a fair trial)
Activities and priorities of work within the component access to justice and the right to a fair trial are
in accordance with the Strategy of the Government of the Republic of Serbia adopted in 2010. Based on the
Strategy, the working group for drafting the Law on Free Legal Aid is authorised to determine the system of
management and supervision of the free legal aid system, and to define the circle of providers, by using all
available capacities and resources, in order to ensure an effective and sustainable system allowing equal ac-
cess to justice for all citizens.

61
Administrative capacities
In terms of administrative capacity building, one of the main priorities and long-term plans is training
and professional development in respect to the implementation of the Law on Free Legal Aid. As part of co-
operation between the Ministry of Justice and Public Administration with the Judicial Academy, continuous
training of judges and prosecutors to implement the new law will be carried out. On the other hand, as part
of the project Justice Sector Support Multi Donor Trust Fund (JSS MDTF), materials for training of provid-
ers of free legal aid in the Republic of Serbia will be created and their training with a view of a more effec-
tive law enforcement will be carried out. Also the purchase of software is planned, which would enable the
use of faster and more efficient access to justice for all citizens.
Measures planned for the period 2014-2016
Active implementation of the Law on Free Legal Aid and possibly harmonisation of regulations in ac-
cordance with needs are planned for the period from 2014 to 2016.
Overview of current and planned foreign development aid
The project titled Improving Access to Justice in the Courts in Serbia is financed from the programme
of bilateral assistance of the Government of the Kingdom of Norway. The implementation of the project was
started in 2011 and implementation is scheduled to be completed by 2013. The total project value is EUR
4.125 million. The overall objective of the project is to improve the administrative capacities in the courts,
restoration and enhancement of public confidence in the judiciary in order to establish a more transparent,
open and efficient judicial system. The project consists of three components: 1. Improving the work of the
courts and access to justice, 2. Support for the reform of the juvenile justice, and 3. Strengthening capacities
of the High Judicial Council.

1.2.3. Economic and Social Rights


Poverty
In 2003-2007 absolute poverty in Serbia was reduced by half and the objective of Poverty Reduction
Strategy in Serbia was accomplished by that. However, in 2008 the reduction trend of absolute poverty was
stopped and financial crisis resulted in re-increase of number of the poor in the country. Absolute poverty
started growing in 2009 as a consequence of deterioration of general economic trends, especially negative
movements on the labour market caused by the effects of the world economic crisis. The rate of absolute
poverty increased from 6.1% in 2008 to 6.9% in 2009. The growth trend of absolute poverty continued dur-
ing 2010 when the recorded absolute poverty rate was 9.2%. With regard to improvement of the position of
the Roma women and men, significant results had been accomplished by the end of 2012 178 Roma peda-
gogic assistants and 75 Roma health mediators were employed in 59 municipalities. The indicators of health
of the Roma have been significantly improved in the last five years. The Law Amending the Law on Identity
Cards has been adopted and provides issuing identity cards to citizens without a permanent residence on the
territory of Republic of Serbia for a two-year period. The Law on Permanent and Temporary Residence of
Citizens has also been adopted and it will solve issue of issuing personal documents for persons without
permanent or temporary residence. In addition, The Government of Republic of Serbia established the Office
for Human and Minority Rights in 2012 competent for implementation of public policies and projects related
to social inclusion of Roma. The reforms realized in the field of education in the previous period contributed
to the increase of quality, relevance, fairness and efficiency of the education and pedagogy system on all
educational levels. Adoption of a set of laws and standards, and Education Strategy of Republic of Serbia
until 2020 especially contributed to this. According to the available data, in recent years the number of Roma
children and the number of children with special needs and disabilities enrolled in primary schools increased;
the net rate of enrolment in secondary schools and number of children included in compulsory pre-school
programmes increased as well as the number of pre-school facilities; number of students is growing on all
studies levels.
As an initial institutional framework for development and implementation of social inclusion policies,
the Government of Serbia established a Social Inclusion and Poverty Reduction Unit within the Office of the
Deputy Prime Minister for European Integration within the project Support to Improvement of the Process
of Social Inclusion in the Republic of Serbia to be realized with support of the Swiss Confederation. The
Unit is in charge of strengthening of the Government capacity to develop and implement social inclusion
policies based on the EU examples of good practices.

62
According to the priorities in the mentioned Analytic Report of the EC (2011); Additional efforts are
necessary to ensure social inclusion of vulnerable groups, such as Roma, disabled persons, young people,
elderly persons and other socially and economically disadvantaged, in 2013. the Government of the Repub-
lic of Serbia will keep on with the implementation of the Project Support to Improvement of the Process of
Social Inclusion in the Republic of Serbia, with support of the Swiss Confederation, to promote social inclu-
sion in the accession process to the EU. (See also Chapter 19-Social Policy and Employment)
Tretment of Socially Vulnerable Persons and Persons with Disabilities and Anti-Discrimination
Principle and Protection of Minority and Cultural Rights
Socially Vulnerable Groups
Overview
Law on Social Protection (Official Gazette of RS No 24/2011) adopted in the National Assembly on
April 4, 2011 entered into force on April 12, 2011. In the drafting period of the Law on Social Protection, the
following international documents have been consulted : The EU Charter of the Fundamental Social Rights,
International Covenant on Economic, Social and Cultural Rights, International Covenant on Civil and Politi-
cal Rights, International Convention on Elimination of All Forms of Racism and Racial Discrimination,
Convention of the Rights of Persons with Disabilities and The United Nations Convention on the Rights of
the Child . This Law is harmonized with the objectives of the Lisboan Strategy signed in 2007, and with the
objectives of social cohesion being the priorities of reform changes in social protection in the Republic of
Serbia.
The principles of the new law are: full scope of accomplishment of human rights and social inclusion,
prohibition of discrimination, observing the best beneficiary interest, active role of a beneficiary in defining
the services, providing quality control. service development at local level, partnership of a public, non-
governmental and private sector. The Law fully supports the reform of accomplishment of the concept of an
integral social protection and achieving two specific objectives: improvement of the protection of the poorest
by providing existential minimum and more efficient system of benefits; and (2) development of a network
of community-based-services through introduction of an integral evaluation and planning in the community,
quality system, territorially and functionally available services. The Law offers more protection to the poor
elderly people in rural area and it encourages building of social service capacities in non-governmental and
private sector.
The new Law not only protects better the poorest, but it protects all citizens needi.ng the social support
through already developed concept of social services. Specifically, the Law introduced a number of new so-
lutions to improve the situation and assist social inclusion of the poorest and of persons belonging to vulner-
able groups in our society - children without parental care, children and the young with disabilities, people
with disabilities, the elderly, Roma, victims of violence, refugees and internally displaced persons (law pro-
vides mechanisms to extend assistance to the poor through higher transfers and social protection network that
includes the most vulnerable groups of citizens who have had difficulty to benefit from social welfare).
It is important to point out that, in accordance with this Law, the Roma people are entailed to the
rights to receive various types of material support, and beneficiaries of social welfare can be foreign citizens
and stateless persons, of course, in accordance with the law and international agreements.
The Law sets out the system based on pluralism and licensing of the service providers and profession-
als. In addition, the Law stresses proactive role and responsibility of the beneficiary, specially of persons of
working age, and it opens possibilities for beneficiaries activating.
According to Article 41. of the Law on Social Protection, trafficking victims - children, the young, the
adults and the elderly are for the first time explicitly defined as beneficiaries of the social protection rights or
services. Social protection institution, in cooperation with other stakeholders in the protection of victims of
trafficking, fulfil their duties under the Convention on Action against Trafficking in Human Beings of the
Council of Europe [CETS No. 197] ratified by the Republic of Serbia, i.e. they deliver to the victims of traf-
ficking, domestic or foreign ones: appropriate and secure accommodation, psychological and material assis-
tance (security and protection of the victim); counselling and information, in particular about their legal
rights and the services available to them, in a language they understand; access to education for children;
necessary medical or other assistance to victims lawfully resident within its territory, without adequate re-
sources and in need of such assistance: the right of access to the labour market, vocational training and edu-
cation; cooperation with non-governmental organizations, other competent organizations or other elements
of civil society engaged in assistance to victims. By Regulation of the Government of the Republic of Serbia

63
on the Network of Social Protection (Official Gazette of RS No 16/2002), the institution Centre for Protec-
tion of Trafficking Victims has been included in the network of social protection institutions and it deals
with coordination of protection of trafficking victims and emergency sheltering and protecting of trafficking
victims. The activities for putting in operation an object where the Centre for Protection of Trafficking Vic-
tims shall be located, are in progress together with establishing a working unit of the Centre-the first emer-
gency shelter for trafficking victims to be financed from the budget of the Republic of Serbia.
According to the Law on Social Protection, local self-government is expected to develop local social
protection services and to initiate a process of defining priorities of citizens and affected groups and to indi-
cate what services could meet these necessities. Novelty of the new Law on Social Protection is support in
financing of these services from the budget of the Republic of Serbia through specific transfers for all mu-
nicipalities that are below the Republic average in terms of the level of development.
Priorities for 2013
A major reform of keeping the record and documentation in the system of social protection is under
way, as well as of methods of data collecting on beneficiaries and the services rendered, i.e. on achieved
rights, and ways of their processing and reporting. An analysis of requirements contained in the guidelines of
the international contracting authorities of the UN system for monitoring the implementation of international
agreements has been made; the recommendations from that analysis related to the monitoring of the status of
the Roma community and other particularly vulnerable groups are included in these activities that are under
way and the completion of which is expected by end of 2013.
Inter-agency activities of drafting the new Strategy of Prevention and Suppression of Human Traf-
ficking and Protection of Victims in Republic of Serbia to be in force in the period of 2012-2017. com-
menced ,with the participation of the Ministry of Labour, Employment and Social Policy.

Measures Planned for Period 2014-2016


Continuation of the activities for improvement of the status of specially vulnerable groups, in particu-
lar social inclusion of children with disabilities and the adult with intellectual disabilities and mental health
issues.
Drafting of standards of social-health services and bylaw of the Law on Social Protection that regu-
lates this field in regard of healthcare system and social protection system (Inter-department issue), as well
as development of community-based social-health services and training of professionals from both systems
to deliver these services, are planned.
Persons with Disabilities
Overview
Issues of importance to equality and full inclusion of persons with disability in the Republic of Serbia
are included in a number of legal acts:: Law on Labour (Official Gazette of RS No 24/05, 61/05 and 54/09)
bans discrimination on the basis of disabilities and regulates protection of persons with disability at work.
The Law on Planning and Construction (Official Gazette of RS No 72/09, 81/09 - corrigendum, 64/10) regu-
lates in details an obilgation of complying with the standards of accessibility when designing and construct-
ing new multi storey building for public or housing purposes as well as stipulated sanctions for the offenders.
Law on the Foundations of Education and Upbringing (Official Gazette of RS No 72/09) strongly affirmed
the concept of inclusive preschool, elementary and secondary school education for children and the youth
with disabilities. The Law on Higher Education (Official Gazette of RS No 76/05, 97/08, 44/10) envisages
measure for equalization of opportunities for students with disabilities. The Law on the Prohibition of Dis-
crimination (Official Gazette of RS No 22/09) has specific article for prohibition of discrimination against
persons with disabilities, while this matter is regulated in details by the Law on Prevention of Discrimination
against Persons with Disabilities (Official Gazette of RS, No 33/06). Law on Road Traffic Safety (Official
Gazette of RS No 41/09, 53/10) contains several provisions giving equal possibilities for having active part
in road traffic to persons with disabilities.
In addition to the introduction of the provisions important for equality of persons with disabilities in
the general strategic documents and laws, the Republic of Serbia adopted the Strategy for Improving the Po-
sition of Persons with Disabilities in the Republic of Serbia 2007-2015 and adopted several important laws
regulating primarily the position of persons with disabilities: 1) the first anti-discrimination law in our coun-
try-Law on Prevention of Discrimination against Persons with Disabilities (Official Gazette of RS No 33/06);

64
2) The Law on Professional Rehabilitation and Employment of Persons with Disabilities (Official Gazette of
RS, No 36/09), as well as 3) Law on Ratification of the Convention on the Rights of Persons with Disabilities
and the Law on Ratification of the Optional Protocol along with the Convention on the Rights of Persons
with Disabilities (Official Gazette of RS No 42/09) by which this international document is integrated in the
national law of our country.
Consistent and continuous implementation of quality legal framework for the position of persons with
disabilities in Serbia is one of the significant challenges and a precondition of true equality and full inclusion
of these persons into our society
As for program for improvement of position of persons with disabilities, and according to provisions
of the Law on Associations (Official Gazette of RS No 51/09), that stipulates that activities of public interest,
involving programs for protection of persons with disabilities, are granted funds on the basis of a public call
for proposals, Ministry of Labour, Employment and Social Policy provides financial and professional assis-
tance to associations through three levels of tender procedures (all competitions priorities shall be prepared
in a dialogue with associations of persons with disabilities, in compliance with the guidelines given by the
assignments and objectives that are formulated by Strategy of Improving the Position of Persons with Dis-
abilities in the Republic of Serbia):
1. In first level, direct financial support is given to programs and services for improvement of
position of persons with disabilities to be realized by 32 Republic and Province unions gather-
ing 526 local associations. Project proposal applicants may be unions/associations acting on
the Republic or Province level and financing is performed on a monthly level.
2. Second level of financing is aimed to all social humanitarian organizations that are regis-
tered in the territory of Republic of Serbia, and Ministry of Labour, Employment and Social
Policy-Department for Protection of persons with disabilities makes a public call in the first
half of the year for submission of project proposals for improvement of position of persons
with disabilities in the Republic of Serbia for current year,
3. Through the third level of funding, Ministry of Labour, Employment and Social Policy-
Department for Protection of persons with disabilities announces Permanent Open Competi-
tion at the beginning of each calendar year with purpose to finance projects for improvement
of accessibility of environment, improvement of spatial-technical working conditions of or-
ganizations of persons with disabilities as well as humanitarian or other programs.
Department for Protection of persons with disabilities completes this year realization of a project Pro-
vision of Improved Local Services DILS funded on the basis of Loan Agreement concluded between the
International Bank for Reconstruction and Development and Republic of Serbia in 2009. The main objective
of the above project was to contribute, after implementation, to the introduction of new services and to a
significant quality improvement of current services and activities realized by the associations of persons with
disabilities, funded from the budget of Republic of Serbia through improved accessibility, efficiency, equal-
ity and quality of local social services.
Development of abovementioned services through financing of the program realized by association of
beneficiaries, in accordance with the provisions of Article 38 of the Law on Associations (Official Gazette
of RS No 51/09), from the funds provided in accordance with the Law on Games of Chance (Official Ga-
zette of RS No 84/04) in previous period brought to the following results:
1. Through financing projects aiming at prevention of institutionalization and deinstitutionalization, the
following is provided:
- Supported housing for persons with disabilities in Belgrade, Pancevo and Kula, where beneficiaries
are trained and prepared for independent living.
- Establishment and operation of 20 day-care centers in 17 cities in Serbia (Belgrade, Valjevo,
Krusevac, Aleksinac, Novi Pazar, Trstenik, Bor, Pirot, Brus, Ivanjica, Aleksandrovac, Kraljevo,
Smederevo, Topola, Sjenica, Odaci, Vrbas), while one of the most important results of the work of
day-cares is that the number of children and the young who are in permanent housing in some of
the institutions of social protection for beneficiaries with disabilities has been significantly reduced.
- The development of stimulating and inclusive programs aimed for children, adults and the elderly
with disabilities, is a service that includes activities aimed to stimulate beneficiary potentials, to en-

65
courage better social integration of persons with disabilities and the expansion of a network of so-
cial contacts and activities aimed to improve the quality of life in order to preserve physical and
mental health of individuals with disabilities.
2.Through financing projects aiming at development of support services for beneficiary independence,
the following is provided
- Personal assistance service-that is an important form of support to persons with disabilities in eve-
ryday activities. According to the new Law on Social Protection (Official Gazette of RS No
24/2011) tendency is to direct complete funding of this service to the local level.
- Opening and operation of 40 offices in 40 cities in the territory of the Republic of Serbia to offer a
service of sign language interpretation to deaf persons.
- Establishment and operation of SOS telephone and continuous legal assistance to persons with dis-
abilities.
- Activities in creating data bases for persons having paraplegia and quadriplegia for getting infor-
mation both on their current condition and on their needs.
- Improvement of accessibility for persons with disabilities-significant results are achieved in im-
provement of physical accessibility for persons with disabilities as the main precondition for inde-
pendence of these persons in their everyday life and work, and for their social integration.
3.Strengthening of capacities of persons with disabilities organizations.
- Education aiming at the awareness building of persons with disabilities and the general public
about persons with disabilities for the sake of their more successful social integration.
- Education with the aim to build capacity of associations of persons with disabilities.
Priorities for 2013 with regard to harmonization of legislation
The procedure of adoption of the Law on Social Entrepreneurship and Employment in Social Enter-
prises is in process; its purpose is to arrange social entrepreneurship, the objectives and the principles of so-
cial entrepreneurship and establishment of a social enterprise, encouragement of social entrepreneurship,
recording and reporting, supervision and other issues relevant to social entrepreneurship of particular public
interest and enter the sphere of economic and social relations and through affirmative action influence the
employment, i.e. realization of the right to work of less employable category of persons that are both finan-
cially and socially disadvantaged. Adoption of the specified Law is expected in the 4th quarter of 2013.
In future, it is necessary to continue with the development of a partnership and direct cooperation with
the local-based beneficiaries associations and to offer both financial and professional assistance in realization
of the activities contributing inclusion of beneficiaries in social community.
Cooperation of Ministry, local self-government and -association is a patricularly important for im-
plementation of the Law on Social Protection (Official Gazette of RS No 24/2011) in the part laying down
the commitment of the units of local self-government to take over financing of services from a local budget.
For detailed presentation refer to-Chapter 19- Social Policy and Employment-Social Inclu-
sion
Roma-see section 1.2.4. Cultural Rights and Minority Protection
Protection of the Youth
By the Law on Youth (Official Gazette of RS No 50/11) and the National Youth Strategy (Official
Gazette of RS No 55/08) a comprehensive protection of population of the age of 15 to 30 is envisaged, par-
ticularly prohibition of discrimination in this population, rights to education, information, safety, health care
and social inclusion).

Social and Economic Council Role


The Law on the Social and Economic Council of the Republic of Serbia (Official Gazette of RS No
124/04) defines that the Council considers law proposals and proposals of other regulations of importance for
economic and social position of the employees and employers and provides its opinions accordingly. Opin-
ion is delivered to the ministry in charge for certain field that prepared the law or some other regulation.
Ministry is obliged to notify the Council on its positions within thirty days from the delivery of the opinion.
If the ministry shall not adopt the opinion, the Council may submit the opinion to the Government.

66
Council opinions are not binding ; according to the specified law they refer to the issues dealing with
the influence of economic policy and measures for its implementation to the social development and stabil-
ity, employment policy, wage and price policies, competition and productivity, privatization and structural
adjustments, labour protection and environment protection, education and vocational training, health and
social welfare and security, demographic trends, collective negotiations as well as other issues according to
the acts of the Social and Economic Council.
Competent ministries should send draft laws to the Council for the opinion in order to enable it toin-
fluence drafting of legal acts in any way. In all Progress Reports so far, the European Commission concluded
that the Council has not been consulted sufficiently during the drafting process of legal acts. The precondi-
tion for the performing the essential dutyof the Council ( the reason of its establishment) is to have the
Government, i.e. competent ministries, fulfilling their legal obligations by submitting the laws from their
scope of work to the Council for the opinion. This is the reason why the Action Plan4 ,as the activity in
charge of Government, defines regular submission of draft laws in the scope of the Council activity for
opinion during 2013, and it may be deemed priority in all years to come.
In cases when certain draft laws were submited for opinion, before the Council adopted the conclu-
sions in its sessions, expert opinions on draft laws were first delivered by the Council permanent working
bodies through the Secretariat, firstly by Working Body on Legislation, also composed in tripartite basis.5
By establishment and operation of permanent working bodies preparation of sessions is improved as the
quality of material to be discussed is higher, and the work of the Council Secretariat employing only three
persons is assisted.
Since 2009, the Secretariat prepares regularly a Work Report to be adopted by a special conclusion in
the Council session and to be delivered to all relevant institutions in the country and abroad, and to be up-
loaded on the internet presentation of the Council (www.socijalnoekonomskisavet.rs). The Activity Report
for 2012, the Activity Plan in 2013, and the Financial Plan for 2013 shall be adopted at the first session of the
Council in 2013.

1.2.4. Cultural Rights and Minority Protection


Cultural Rights
Overview
Law on Culture was adopted in 2009, and entered into force in March 2010.6 This law defines in de-
tails general interest in culture, it mentions the principles of cultural development and defines priority
branches of culture and creativity. Thus, for example, it is defined that the cultural policy of the Republic
of Serbia is based on the principles of freedom of expression in cultural and Arts creativity, the autonomy
of entities in the culture, on openness and public accessibility of cultural content to the public and citizens,
on respect for cultural and democratic values of the European and national traditions and diversity of cultural
expressions ...7 Also, the public interest in culture involves creating opportunities for intensive and coordi-
nated cultural development, creating conditions for the promotion of cultural and artistic creativity, research,
preservation and use of cultural heritage, discovering, creation, studying, conservation and presentation of
Serbian culture and the culture of national minorities in the Republic of Serbia, encouragement of profes-
sional and scientific research in culture, encouraging the implementation of new technologies in culture, es-
pecially information technology and digitalization, encouraging cultural and artistic creativity of persons
with disabilities and the availability of cultural activities to persons with disabilities...8 The above Law pro-
vides opportunities to national minority councils to look after the implementation of cultural policy of na-
tional minorities and to participate, according to the law, in the process of decision making or to bring

4
Action plan for fulfilment of recommendation of the European Commission in the Annual report on Republic of
Serbia Progress in the European Integration Process 2012, adopted by the Government of Serbia in its session of
December 6, 2012.
5
When necessary, professional opinions have been provided also by Standing Working Body on Economic Issues,
Working Body on Collective Negotiations and Peaceful Resolution of Work-Related Disputes, Working Body on
Safety at Work and Health Issues
6
Law on activities of general interest in culture becomes invalid hereby.
7
Law on Culture Art. 3.
8
Law on Culture, art. 6.

67
decisions themselves on certain questions related to their culture, to establish institutions in culture and other
legal persons in culture.9
Concerning the issue of establishment of the National Council for Culture that is to be formed as a
professional-counselling body, with the aim to provide permanent professional support to preservation, devel-
opment and spreading of culture (Article 15), two members of minorities are appointed at a proposal of Na-
tional Minority Councils (Article 16). The Republic of Serbia, the Autonomous Province and local self-
government unit may establish institutions for the preservation, promotion and development of cultural
specificity and preserving the national identity of national minorities or they may, at the proposal of the Na-
tional Council of National Minority, by amendment of the constituent instrument appoint certain institutions
as of a particular importance to the preservation, promotion and development of cultural specificity and pres-
ervation of the national identity of national minorities (Article 24). In addition, at least one member of the
Management Board is appointed by corresponding National Minority Council into the Management Board of
the establishing institution in accordance with the previous article 24 of the Law on Culture. When several Na-
tional Minority Councils make a proposal for a member to the managing board, the proposal is jointly sub-
mitted by all interested National Minority Councils (Article 42). In case of the institutions supervising
board, at least one member of supervising board is appointed at proposal of corresponding National Minor-
ity Council (Article 46). An artist, or an expert in culture, whose work in the field of cultural activities gave
supreme contribution to the national culture, and the culture of national minorities in the Republic of Serbia,
meeting the other conditions laid down by this Law and regulations adopted for the implementation of the
Law, may acquire the status of a distinguished artist and prominent expert in culture (Article 68).
Measures for implementation of priorities in 2013
In addition to regular activities, the Ministry intends to have meetings in 2013 with the representatives
of the national minorities living on the territory of RS south of AP Vojvodina to build their capacities and to
reach the potential level of minorities in Provinces. It has been planned that counselling body shall closely
cooperate with the Ministry, with reciprocal outline of the problems at field, as to consider jointly available
potentials.
Minority Protection
Overview
In accordance with European Charter for Regional or Minority Languages and the Framework Conven-
tion for the Protection of National Minorities of the Council of Europe, as well as in accordance with obliga-
tions of national legislation relating to the rights of persons belonging to national minorities to information in
own language, Ministry of Culture and Information announces regular annual call for proposals for co-
funding of projects / programs in the field of public information in the languagesof national minorities.
Call for proposals for co-funding of these projects for 2013 has been announced on November 22,
2012 and it was closed on December 22, 2012. Call for proposals realization is planned in the first quarter of
2013. The funds in a budget for 2013 are at the same level as for previous year.

Description of the Situation in Municipalities Presevo, Bujanovac, and Medvedja


Overview
Representatives of three ethnic groups-Serbs, Albanians and Roma, live in municipalities Presevo, Bu-
janovac and Medvedja. Although the relations of the Serbs and Albanians are characterized by a complex
past, general conclusion is that inter-ethnical relations in this part of Serbia are stable, with a tendency for
improvement.
These municipalities are designated as under-developed ones with the indicators such as high unem-
ployment rate, poverty, poorly developed infrastructure, negative migration trends, lack of human resources
and numerous other problems. Due to unfavourable economic aspects, significant number of inhabitants of
all ethnic groups, mostly the young, move away.

9
Law on Culture, art. 5, 15. and 16. In September 2009 Law on National Councils of National Minorities was adopted
and, among other things, their right to establish institutions in culture and media was laid down. Another important step
has been made for integration of national minorities and sensibility of public in Serbia concerning preservation and
promotion of their cultural and language specificities.

68
After 2001, it was necessary to direct activities to the establishment of trust among ethnic communities
in Presevo, Bujanovac and Medvedja, and also to develop an infrastructure and strengthen these municipali-
ties. That is why, until recently, the focus was to provide peace and political stability with permanent in-
vestment into, first, infrastructural development of municipalities. Although they still belong to a group of
underdeveloped municipalities, thanks to these investments today Presevo, Bujanovac and Medvedja are sig-
nificantly different compared to the year 2001.
The issue of municipalities integration, both at the local level, as well as integration of Albanians into
social, political and economic processed in the Republic of Serbia are of the extreme importance. Priority is
to work with the young people with the objective to strengthen and provide stable growth and progress of the
municipalities. Education, being the first and irreplaceable pillar of growth and integration, is the centre of
interest of the Government of the Republic of Serbia and the Coordination Body, as well as of the interna-
tional community representatives.

Measures for implementation of priorities in 2013


In the field of economic development:
Call for proposals for subventions to private companies in 2013 in municipalities of Presevo, Buja-
novac and Medvedja amounting to 60 million RSD: the first and second quarter: The allocated funds shall be
used to finance the following measures: measure of co-financing of projects for agricultural development of
cooperatives, small and medium-sized companies and entrepreneurs who are registered to practice primary
agricultural production and co-financing measures for projects of the small and medium companies and en-
trepreneurs with growth and new employment tendency of growth.
An investment fair, the first and second quarter. Coordination Body in cooperation with Chamber of
Commerce of Serbia shall organize in Belgrade a fair where the entrepreneurs from the South of Serbia shall
present themselves to domestic and foreign investors. The aim of this activity is to increase investment in the
south Serbian municipalities with an employment growth.
In the field of education and integration:
Scholarships for studying on faculties of the Novi Sad University, the first, second, third, and fourth
quarter: Since 2011, Coordination Body Office provides scholarships for the young from municipalities Bu-
janovac and Presevo who want to enrol in graduate studies on the faculties of the Novi Sad University. In the
first quarter, Coordination Body Office shall organize meetings with pupils and their parents in Bujanovac
and Presevo schools and it shall prepare media campaign to provide opportunity to inform everybody aged
from 18 to 22 on conditions for scholarship. In the second quarter, Commission of the Coordinating Body
Office shall select the candidates for scholarship; for those coming from the Albanian community, Serbian
language courses shall be organized for an easier passing of entrance exam. In the third quarter, the candi-
dates shall sit for entrance examination and all those who pass it shall meet the conditions for scholarship of
the Coordination Body Office.
Scholarships for secondary school pupils from municipalities Presevo, Bujanovac and Medvedja, the
first, second, third, and fourth quarter: Since 2009, Coordination Body Office provides scholarships for sec-
ondary school pupils from three municipalities in the south of Serbia. Monthly scholarship amounts to 6,000
RSD. Coordination Body Office shall announce call for proposals for secondary school pupils scholarship.
With regard to high poverty level and unemployment that characterize these three municipalities, scholar-
ships of the Coordination Body Office have social character. Children without one or both parents shall have
priority in scholarship providing; Scholarship commission shall observe parents and custodians social posi-
tion as well as pupils grades in a previous academic year.
Scholarships for students of the Department of Economics and Law School of the University of Nis in
Medvedja, the second and fourth quarter: Departments of Economics and Law School of the University in
Nis were opened in Medvedja in 2009. The particularity of these two Departments is in fact that students
from the Albanian community attend lectures with simultaneous translation provided. Passing of tests and
colloquia in their native language is provided, and the Coordination Body Office has provided textbooks
translated into Albanian. For students of these two Departments who enrol the subsequent academic year, the
Coordinating Body Office provides scholarship in the amount of 7,000 RSD at one-time basis twice a year.
Department of School of Economics from Subotica in Bujanovac, the first, second, third, and fourth
quarter: School of Economics from Subotica of the University in Novi Sad opened department of the School
in Bujanovac in October 2011; that fulfils one of the most important objectives of the Governmental Pro-

69
gram for the South of Serbia. Teaching at the Department of School of Economics is conducted bilingually;
students of Serbian and Roma communities attend lectures in Serbian language, while students from the Al-
banian community attend part of subjects in Albanian language. Together with the EU Progress program and
the municipality of Bujanovac, the Coordination Body Office has provided funds for the construction of the
Department of the Faculty of Economics (1480 square meters). In order to provide funds for School equip-
ment, the Coordination Body Office shall require assistance from the international donors. Completion of
construction work and equipping of new facilities is expected by October 2013. In the second quarter, the
Coordination Body Office shall provide translation and printing of necessary textbooks for students from the
Albanian community.
- School of Serbian, the first, second, third, and fourth quarter: Out of donations from the British Em-
bassy, Coordination Body Office has provided funds for organizing free seven-month Serbian language
school for the young of age between 15 and 30 from the Albanian community from municipalities of Buja-
novac and Presevo. Teaching shall be completed in May 2013, and the Office shall announce an invitation
for new trainees in the second quarter. We expect that funds for organization shall come from donation.
Textbooks for pupils from Albanian community, the first, second, third, and fourth quarter: Working
Group for textbooks in Albanian was formed by decision of the Minister of Education and Science in the end
of 2010. It involves representatives of the Ministry of Education, Science and Technological Development,
Coordination Body Office, National Council of Albanians, National Educational Council, Institute for the
Advancement of Education, public and private publishers. By December 2012, 77 textbooks have been pro-
vided for pupils of elementary schools with teaching in Albanian. In 2013, Working Group shall be working
on obtaining other textbooks for pupils of elementary schools and preschools.
School supplies and bags for pupils of the first grade; the second and third quarter: Coordination
Body Office shall provide school supplies and pupil bags for pupils of the first grade of elementary school
from the territory of three municipalities.
Call for proposals for non-governmental organization, the first, second, and third quarter: Coordina-
tion Body Office shall keep on working on establishment of association in municipalities Presevo, Buja-
novac, and Medvedja for promotion of the spirit of tolerance, understanding and cooperation. Coordination
Body Office shall announce call for proposals to implement the projects of association in the second quarter.
Outpatient Maternity Ward in Presevo
In December 2012, the first phase of construction works for building outpatient maternity ward in Pre-
sevo was completed. Coordination Body Office allocated part of funds from 2013 budget to carry out works
of the second phase-construction of boiler room and techno block for maternity ward. Municipality of Pre-
sevo shall participate in financing of this phase, and the support of Ministry of Health is expected as well. It
is necessary to provide the equipment from grants.

Infrastructural Projects
Decision on allocation of funds from budget of Coordination Body Office for investment in infrastruc-
tural projects of three municipalities shall be reached on the session of the Presidency of Coordination Body
(the first quarter). Municipality presidents shall submit a priority list of projects to the Coordination Body
Office.

Measures Planned for the Period 2014-2016


- Economic strengthening of entrepreneurs of three municipalities, encouragement of economic
growth and employment, increase of investments in three municipalities.
- Investment in infrastructural projects of three municipalities.
- Scholarships for the young from municipalities Bujanovac and Presevo to study in Novi Sad.
- Support to department of School of Economics in Bujanovac and departments of School of
Economics and Law in Medvedja.
- Further providing of textbooks for pupils from Albanian community.
- Integration of the Albanians into public institutions;
- Serbian language school;

70
- Improvement of inter-ethnical cooperation among the young of Albanian, Roma and Serbian
communities through work in projects in the field of culture (IPA Funds).
National Minority Councils
Overview
The Law on National Minority Councils (Official Gazette of RS No 72/09) and bylaws- Rulebook on
the contents of the register of national minority councils (Official Gazette of RS No 91/09), Rulebook on the
method of keeping a separate electoral list (Official Gazette of RS No 91/09), Rulebook on the shape and
content of a form to collect signatures of voters who support electors, No 91/09) and Regulation on proce-
dure of distribution of the budget funds of the RS to finance National Minority Councils (Official Gazette of
RS No 95/10), arrange the competence of the National Minority Councils in the field of culture, education,
information and official use of language and alphabet, the procedure of election of the National Councils,
their financing and other issues of importance for operation of the National Councils.

National Program for Roma


The priorities of the Serbian presidency of the Decade of Roma were housing, discrimination suppres-
sion in education, the development of the European Roma Platform and the use of EU funds for improving
the situation of Roma, as well as the development of monitoring and evaluation system. Three meetings of
the International Steering Committee of the Decade were held during the presidency of Serbia, where the
conclusions regarding priority themes and three international workshops were brought, and where technical
issues related to housing and development of monitoring and evaluation system were discussed. The meeting
of the representatives of the countries from the area of Former Yugoslavia was held to agree about the coop-
eration on issues of the refugees, internally displaced persons and Roma returnees upon readmission agree-
ments, standardization of the Romani language and access to EU funds for Roma projects in accession
countries. Priority topic of discrimination suppression in education was discussed on the international con-
ference Right to Education for Each Child: Barrier Elimination and Encouragement of Roma Children In-
clusion, bringing so called Belgrade Document that should represent a sort of a roadmap of Decade
member countries with regard to improvement of Roma education.
In addition to activities on the international level, in the year of presidency to Roma Decade, the RS
Government worked out the foundation for systematic approach to improvement of Roma position. On April
9, 2009, the Government adopted Strategy for Improvement of Roma Position in Republic of Serbia as
part of efforts to mitigate the adverse social circumstances where most of the Roma minority live, and to im-
prove their status.
The basic approach for improvement of Roma position in the housing area rests in necessity to legalize
Romas settlements. For those settlements that are found not be legalized and improved, the Strategy envis-
ages the need to improve living conditions on the basis of appropriate technical solutions to basic infrastruc-
ture (water, electricity, access roads, etc.) up to their displacement / relocation. Regular utility and technical
maintenance through appropriate institutional system that exists in other parts of the city should be available
in all Roma settlements. Strategy envisages that settlement coordinators should be introduced in settlement
maintenance system as full time employees within corresponding municipal or city services. The recommen-
dations contained in the Strategy for the employment area comprise general recommendations on measures
for employment and entrepreneurship increase among Roma, and on participation of Roma in public services
and public works as one of the measures that can increase employment among Roma.
Measures for implementation of priorities in 2013
Adoption of the Action Plan for Implementation of Strategy for Improvement of Roma Position
(the second, third and fourth quarter)
Action Plan for Implementation of Strategy for Improvement of Roma Position
A draft of the Action Plan for implementation of Strategy for Improvement of Roma Position within
2012-2014 has been prepared. In this process participated representatives of competent institutions, the Na-
tional Council of Roma Minority, Roma associations and associations dealing with issues included in Strat-
egy, as well as international organizations. The EU Framework for National Roma Integration Strategies, as
well as the EC Guidelines for drafting of national strategies for Roma integration or integrated set of meas-
ures has been among initial documents for creation of the Action Plan.

71
Inter-ministerial Working Group for Implementation of the Action Plan for Improvement of the Situation
of the Roma
The office has organized the first meeting of Inter-ministerial Working Group for Implementation of
the Action Plan for Improvement of the Situation of Roma. The topic of the meeting was the introduction of
Roma Inclusion Adviser at the ministries responsible for the implementation of the Action Plan. The Office
shall employ six advisers for the period of two years out of donors funds. The Adviser role shall be to support
implementation of relevant measures within the Roma Strategy and to contribute better cooperation among
ministries and the Office for Human and Minority Rights in this field. In consultation with the relevant minis-
tries, the Office shall announce the call for proposals for employing an Adviser in early 2013.
Treatment of Socially Vulnerable Persons and Persons with Disabilities and Anti-Discrimination
Principle and Protection of Minority and Cultural Rights
Overview
Administration for Human and Minority Rights coordinated activities of competent authorities regard-
ing displacement of informal Roma settlement in Block 72 in Novi Beograd that is carried out in accordance
with the Guidelines on Development-Based Evictions and Displacement, prepared by the UN Special Rap-
porteur on Adequate Housing. In accordance with the recommendation of the Ombudsman, the Minister for
Human and Minority Rights, Public Administration and Local Self-Government formed a special working
group for this issue which held eight meetings; Office for Human and Minority Rights, coordinated the proc-
ess of common consultation with the residents of the settlement (10 rounds of consultations were held); visits
to offered alternative housing were organized; resettlement was delayed until March 2012; fuel for all resi-
dents was provided. Voluntary relocation of the residents was completed by the end of May 2012.
A Report on relocation of the Roma settlement near Block 72 in Novi Beograd has been made
and through the Ministry of Foreign Affairs submitted to the UN Special Rapporteur on Adequate
Housing..
Relocation of the specified settlement has been carried out for the first time in accordance with the Ba-
sic Principles and Guidelines on Development-Based Evictions and Displacement prepared by the UN Spe-
cial Rapporteur on Adequate Housing
A Conference has been organized to present Report and results on this activity. In cooperation
with OSCE and the City of Belgrade a draft of terms of reference for a Study on locations used in forced
relocations to settle Roma from a settlement near Bellville and other settlements in Belgrade, has been
made.
A report on dislocation of Roma families from informal settlements near Bellville in Novi Beograd, as
a component of the right to adequate living standards and of the right not to suffer discrimination on this
ground was prepared upon request of the UN Special Rapporteur on Adequate Housing Independent Expert
on minority issues and Special Rapporteur for Modern Forms of Racism, Racial Discrimination, Xenophobia
and of Intolerance according to the Resolutions of the Human Rights Council 15/8, 16/6 and 16/33.
Measures of Affirmative Action in the Education of Roma Children
Overview
Measures of Affirmative Action in the Education of Roma Children. Measures of affirmative action re-
garding the members of Roma minority are applied in Serbia since academic year 2003/2004 according to
the article 4 paragraph2 of the Law on the Protection of Rights and Freedoms of National Minorities envisag-
ing the obligation of public authorities to take actions to promote position of persons belonging to Roma mi-
nority and article 4 of the Framework Convention for the Protection of National Minorities CE defining the
obligation of the member countries to take actions to promote full and efficient equality of the national mi-
norities members. These measures are part of Action Plan for Implementation of the Strategy for Improve-
ment of Roma situation in the education field.
The Office for Human and Minority Rights collects data and prepares lists of candidates who meet
conditions, and then forward them to the Ministry of Education, Science and Technologic Development.
With application of affirmative action, universities and colleges enrolled 238 Roma candidates, and
secondary schools enrolled 367 Roma pupils in academic year2012/2013. In the previous academic year,
2010/2011, 104 students and 256 pupils were enrolled through measures of affirmative action. Since aca-

72
demic year 2003/2004 up to now, 1092 students and 1948 secondary school pupils have been enrolled with
implementation of the affirmative action.
Calls for proposals for funding associations, association unions, and foundations registered on the ter-
ritory of the Republic of Serbia
On the occasion of April 8, World Day of Roma, a call for proposals was completed where three
Roma associations were granted funds amounting to about 2,000,000.00 RSD for realization of projects with
objectives to introduce identity, tradition, culture and language of Roma minority to broader social commu-
nity, as well as fight against discrimination and awareness rising on the importance of tolerance, equality and
versatility respect.
Financial resources have been granted on the basis of the call for proposals to associations that fur-
nished the project proposals to the Office for Human and Minority Rights and whose objectives are: preven-
tion and assistance in the implementation of policies in the field of asylum and readmission, with special
emphasis on prevention improvement in the above mentioned fields within the current legislative framework
and in accordance with the European standards focused to the Roma population; more efficient implementa-
tion of current strategic documents regarding Roma position and status in Serbia through elaboration of rele-
vant reports and researches; Improvement of life quality of Roma population through creating and promotion
of integrated local services/programs (inter-department and inter-municipalities); prevention and suppression
of trafficking through innovative local programs and through raising awareness of the present trafficking
forms in the Republic of Serbia focused to the Roma population; encouraging positive action of broader
community regarding the representatives of Roma population as a vulnerable population in the scope of mi-
grations - national, regional and towards the EU.
Overall funds allocated by this call for proposals for selected programs are 22,500,000.00 RSD, i.e. up
to 2,000,000.00 RSD for each selected program. 59 associations applied for a call for proposals and funds
were approved for 14 projects of associations.
Measures for implementation of priorities in 2013
Bylaw which will regulate implementation of affirmative measures for enrolment of pupils of Roma
nationality (the second, third and fourth quarter)
Rulebook for implementation of measures of affirmative action
The Office shall initiate passing the bylaw defining more closely criteria and procedures in implemen-
tation of affirmative action for enrolment of pupils of Roma nationality in secondary schools and colleges in
the Republic of Serbia.
Health Care of Roma
Overview
Ministry of Health created in 2008 the first electronic database (for data coming from projects of
health centres, the Institute of Public Health and Roma civil associations), and in 2010 second database (for
the data collected in the field by Healthcare mediators) and recorded to date:
Measures Planned for the Period 2014-2016
Electronic database records at present 128,193 Romas; 37,227 families; 316,987 visits (40,227
women; 37,227 men; 50,739 children) in 1045 settlements.
The objectives of Ministry of Health relating to health promotion to be priorities in the period to come
2012-2014:
1. Monitoring of Roma population health
2. Further development of indicators for monitoring of Roma population health
3.Increasing availability and quality of health care for Roma population
4. Organizing seminars and workshops for medical staff and allied with a view to better introduction of
specific needs of Roma population; establishment of better communication and understanding
5. Improvement of work of visiting nurses
6. Organization of education of Roma about their rights to health care
7. Improvement of work of health mediators
Engagement of health mediators

73
Development of the monitoring system of the work of health mediators
Expending the work of health mediators in the provision of aid to
A) vulnerable groups in rural environment
B) To Children of the Streets
C) To the homeless.
8. Job classification of a health mediator (employment of Roma health mediators is necessary as they directly
encourage Roma to use services of health and social protection as well as all other services for realization of
their civil and legal rights and obligations. In that way the level of knowledge and inclusion of the Roma
increase)
9. Improvement of health of the Roma population, specially women and children
10. To strengthen and further develop activities on healthy way of living in Roma population
11. Improvement of the environment and housing conditions in all Roma settlements
12. Including Roma in counselling services of health centres
13. Ensuring immunization of adult population dealing with collecting waste against tetanus and hepatitis
"B"
14. Implementation of the project for improvement of the health of Roma (priorities: compulsory
immunization coverage, improvement of reproductive health, prevention of chronic non-communicable
diseases, specific health care for Roma dealing with secondary raw materials collection, addiction,
Tuberculosis etc).
15. Enabling parents / guardians and children for active attitude and taking responsibility for health
16. Improving the nutritional status of infants and young children in Roma settlements
17. Improvement of environment in Roma community
Regular analysis of hygiene-epidemiological conditions in Roma settlement.
Elaborating and implementing proposal of measures of the Public Health Institute to improve housing
conditions.
Overview of Current and Planned Foreign Development Aid
Sensitization of medical staff to work with Roma population is carried out through the project Deliv-
ery of Improved Local Services DILS and PBILD projects for 13 municipalities on the south of Serbia in
cooperation with the UNICEF.
One of criteria to select a project to be implemented by health centres with Roma civil associations
and Public Health Institutes is that one of the projects defines activities is sensitization, as well as education
for Roma population concerning realization of their rights in health care. Education of Roma about their
rights in health care is also performed by health mediators within their regular job.
With support of the Global Fund, Ministry of Health implements two major projects relating to public
health: "Control of TB in Serbia through the implementation of Direct Observed Therapy Strategy", which
covers 122 Roma settlements in 14 cities, total surveyed 14,815 Roma, 14,941 have been educated, eight
new cases discovered. Special target group are children by age of 14 from Roma settlements; 8,172 tests,
subject to tuberculosis infection 4% as well as in the whole children population - good immunization cover-
age in maternity hospitals; only one case has been discovered, incidence 13/100 000; Fight Against
HIV/SIDA in Serbia through voluntary and confidential counselling and testing to HIV; distribution of pro-
phylactic means and educational workshops passed by 20,564 young Roma. Ministry of Health of the RS
initiated Employment and Educational Project for Roma Health Mediators. The Project is financed and im-
plemented by the RS Ministry of Health with technical support of the Organization for Security and Coop-
eration in Europe within the program for Roma Inclusion funded by the EU. Through the territorial
competent Institutes of Public Health and with the help of Roma associations of citizens, hygiene-
epidemiological evaluation for 228 settlements with the included 3297 households was conducted.
The Ministry of Health implemented a project Employment of Roma Health mediators: Economic
Analysis of Introducing Roma Health Mediators into the Public Health Institutions in Serbia in 2010 funded
by Fund for an Open Society. One of the Project components is an economic analysis done by the Institute of

74
Economic Sciences that established what improvement the work of health mediators made for Roma health,
and what was the cost for Serbian health system.
The analysis results indicate that there are measurable and immeasurable benefits for Roma popula-
tion.
Measurable results: Effects in money
- Savings in primary health protection
- Savings due to reduced treatment in stationary medical institutions
Effects in prolongation of the life span of Roma
- prolongation of the life span of infants and children
- prolongation of the life span of the adults
- Reduction of the mortality rate of Roma population
Immeasurable advantages:
- Introduction of children into the educational system
- Efficient realization of rights in the field of social protection of incapable and poor Roma
- Reduction of Roma poverty
- Providing of material recourses for improving of life conditions of Roma t
- Improvement of general life conditions of Roma
- Improvement of health of Roma
- Engagement of Roma into the realization of project
- Arrangement of living conditions
- Activating of Roma within local community
- Engagement of Roma in the process of making decisions of importance for their families life.
Within the SWIFT Project, the Office of the World Health Organization in Serbia in cooperation with
another two UN agencies (IOM and UNOPS), Ministry of Health and City of Belgrade, opened an author-
ized recycle centre in Mirijevo in December 2010. The activity of the SWIFT recycle centre is collection and
processing of secondary raw materials, first paper, cardboard, plastic, and metal. The new Law on Waste
Management (adopted in May 2009) brings new obligations for companies in waste recycling. The Law en-
visages that secondary raw materials must be documented and delivered to a licensed waste management
operator. Cooperative SWIFT offers this service to clients free of charge.

1.3. Regional Cooperation and International Obligations


1.3.1. Regional Cooperation
The Republic of Serbia is highly motivated to develop relations with immediate neighbours and coun-
tries in the region of South-East Europe, thus affirming one of the priorities of its foreign policy improve-
ment of regional cooperation. Regional cooperation, especially through regional fora and initiatives,
represents addition to strengthening of bilateral relations with the neighbours and the states from the South-
East Europe region. At the same time, deepened regional cooperation of the Republic of Serbia, especially
through European strategies such as the one for the river Danube basin, and soon the one for Adriatic-Ionian
macro region although important step on the road towards European integrations of the Republic of Serbia
- cannot become substitute for the process of EU integrations of the Republic of Serbia.
During the second half of 2011 and the first half of 2012, the Republic of Serbia has been the centre of
regional cooperation. In June 2012, Serbia has ended its presidency of the South-East Europe Cooperation
Process (SEECP) and Black Sea Economic Cooperation (BSEC). In April of 2012, presidency of Adriatic-
Ionian Initiative has ended, as well as presidency of the Migration, Asylum, Refugees Regional Initiative

75
(MAARI). At the end of 2011 the Republic of Serbia ended its presidency over Central European Initiative
(CEI).
Priorities during our presidency have been: combating organized crime and international terrorism,
continuation of reforms at all levels, deepening of the dialog with the EC and EU institutions, strengthening
the rule of law and protection of human and minority rights, dealing with the problem of refugees, displaced
and missing persons, protection of environment, prevention and sanitation of consequences of all types of
weather conditions, strengthening of parliamentary cooperation, creating better conditions for attracting for-
eign investments, cooperation in the fields of education, science and culture.
The mentioned priorities and all our activities during the presidency were in accordance with our stra-
tegic orientation - stabilization, cooperation and development in the region, as a condition for advancement
in European integrations.
Presidency over Regional Initiatives has confirmed that the Republic of Serbia owns political and in-
stitutional capacity for proper presidency and realization of ambitious programmes for various regional ini-
tiatives. More than 70 international conferences and meetings at expert, ministerial or the highest level have
been organized.
Besides the above mentioned, the Republic of Serbia is actively involved in numerous other regional
initiatives such as: Regional Cooperation Council (RCC), EU Strategy for the Danube Region (EUSDR),
International Commission for Sava River, Tisa Group, Southeast European Cooperation Initiative, Regional
Southeast European Law Enforcement Centre. We are actively involved in a number of regional initiatives
which are, although autonomous, connected to the Regional Cooperation Council.
1. Southeast European Cooperation Process (SEECP)
Overview
The Republic of Serbia was the chairman of the Southeast European Cooperation Process (SEECP)
from June 2011 until June 2012. This chairmanship confirmed strong and coherent determination for intensi-
fication of all types of regional cooperation that would contribute to regional stability and its European inte-
grations, as well as international affirmation. The new general secretary Goran Svilanovi has been elected,
whereby the Republic of Serbia has gained a representative at an important position in regional initiatives.
Overview of 2013 priorities
During the one-year presidency of the Republic of Macedonia over the SEECP, Serbia has an obliga-
tion to participate in the coordination meetings of the three SEECP member states together with Macedonia
and Romania, considering that the work of SEECP involves representatives of previous, present and future
state that presides this regional initiative. It is the obligation of Serbia to participate at the expert, ministerial
and the highest levels in the meetings of SEECP political directors, informal and formal meetings of foreign
affairs ministers as well as in the summit of chiefs of states and governments of the countries participating in
SEECP. Serbia participates in prioritizing Southeast European Cooperation Process in terms of formulating
the RCC working programme for period between 2014 and 2016.
Administrative Capacities
National coordinator for SEECP has been appointed by the Ministry of Foreign Affairs, while the
same issue is dealt with by the Regional Initiatives Department and the European Union Sector of the Minis-
try of Foreign Affairs, as well as relevant divisions in the line ministries.
Overview of Current and Planned Foreign Development Aid
There is assistance for the projects being realized in relevant competent ministries.
2. Regional Cooperation Council (RCC)
Overview
Republic of Serbia is actively involved in Regional Cooperation Council (RCC). Annual meeting of
RCC was held in Belgrade, on 13 June 2012, as a part of the final part of our chairmanship over SEECP. The
Republic of Serbia views the influence of RCC primarily through promotion of focused regional cooperation,
creation of positive image of the entire region, as well as functional cohesion of RCC and SEECP.
RCC participates in programming of multi-beneficiary IPA component, with a view to approximate
IPA and other donors priorities with priorities of the region. With the same objective the RCC Secretariat,

76
participates in work of Consultative Group of international financial institutions, as well as in the steering
board of West Balkans Investment Framework (WBIF).
Overview of 2013 Priorities
Serbia, as a member of RCC is actively involved in realization of priorities described in RCC Strategy
and Working Programme for period 2011-2013.
Administrative Capacities
National coordinator for RCC has been appointed by the Ministry of Foreign Affairs, while the Re-
gional initiatives Department of the European Union Sector of the Ministry of Foreign Affairs is as well as
relevant sectors in the competent ministries.
Measures Planned for the period 2014-2016
Measures planned for 2014-2016 period will be compliant with the priorities formulated in the RCC
Strategy and Working Programme for period 2014-2016.
3. Central European Initiative (CEI)
Overview
During presidency over CEI, several initiatives have been continued or initiated: founding of the new
CEI and EBRD support fund for European integrations of the CEI countries; revision of contribution scales
in CEI Cooperation Fund; initiative for revival of CEI business dimension; initiative for creating CEI non
governmental organizations and associations network; intensification of cooperation in the field of science,
especially with European Commission; the procedure for acquiring the status of observer for CEI in the
UNGA. The political dialog between CEI countries has been initiated: summit, meeting of foreign affairs
ministers, more meetings of CEI parliamentary dimension, greater number of ministerial and expert meet-
ings, youth forum etc.
Overview of 2013 Priorities
Basic directions of CEI activities are defined by Action Plan for 2010-2012, as well as by the deci-
sions of the Minister of Internal Affairs from 2010, 2011, and 2012. At the meeting of CEI national coordi-
nators in Trieste last year, it has been agreed to extend the current CEI Action Plan until the end of 2013 and
prepare the new one for 2014-2016 period, that would be aligned with EU Agenda 2020 and relevant finan-
cial Program period for the 2014-2016.
CEI Activities are also defined by priorities of the country currently presiding (Hungary): 1) CEI visi-
bility improvement, 2) sustainable development, 3) mobility (in terms of transport needed for development
of both tourism and trade), inclusion (i.e. connecting and including various cultures).
Administrative Capacities
National coordinator has been appointed for CEI while Division for Regional Initiatives of the Euro-
pean Union Department of MFA and relevant divisions in the line ministries are competent for CEI.
Measures for Implementation of Priorities for 2013
Not provided, considering that it is the responsibility of Hungary as the president of CEI as well as Se-
cretariat of CEI in Trieste. Serbia as a member of CEI is actively involved in the realization of these goals
and is in particularly engaged in the projects of special interest for the country.
Measures Planned for period 2014-2016
The new CEI Action Plan for 2014-2016 is expected and it will provide concrete responsibilities.
Overview of current and planning of foreign development assistance
CEI activities are conducted through regional cooperation projects that are co-funded from the Coop-
eration Fund, from KEP programme (Austria, Italy), special funds of Italy, who is the main financier of such
projects in cooperation with EBRD. Besides that, CEI projects are co-funded through cooperation with
European Union, by CEI application for financial assistance from the European Commission or participation
in its projects related to CEI.
CEI implements numerous projects, which are, among other sources, co-financed from IPA pro-
gramme for countries in the region. One of these important projects for CEI is Improving Cooperation in
South-East Europe by Actions for Strengthening the Regional Cooperation Council".

77
As far as Serbia in particular is concerned, CEI has been engaged on the South-East European Trans-
port Axis Cooperation project SEETAC, which was completed at the end of August 2012.
4. Adriatic Ionian Initiative (AII)
Overview
During the presidency of the Republic of Serbia over Adriatic-Ionian Initiative (AII) from 1 June 2011
until 31 May 2012, multiple meetings and round tables in the fields of SME development, transport, sailing,
culture, tourism, environmental protection and rural development have been organized. By the donation of
the Republic of Italy, Adriatic-Ionian Initiative has from November 2012 officially become project-oriented
initiative.
The Republic of Serbia supports defining Adriatic-Ionian area as a micro-region as well as drawing up
the EU Strategy, in accordance with the already existing strategies for the Baltic and the Danube Regions.
On 14 December, European Council has, in its Conclusions, awarded the mandate to the European Commis-
sion to draft the EU Strategy for Adriatic-Ionian macro-region. Maritime segment that has already been
drafted and presented in Communication on maritime aspects of the Strategy for Adriatic-Ionian macro re-
gion will be included in this comprehensive Strategy. The Republic of Serbia is interested in making ade-
quate contribution to the process of the Strategy drafting.
Overview of 2013 priorities
Activities of AII are defined by priorities of current AII presiding country (Slovenia), as well as by de-
cisions of the council of foreign affairs ministers that has sessions once a year. Priorities of Slovenian presi-
dency are focused on the sea and maritime zone and in that context it will include the following areas:
Protection of environment, combating forest fires, protection of cultural heritage in the territorial sea and sea
safety.
Administrative capacities
National coordinator has been appointed for AII while Division for Regional Initiatives of the Euro-
pean Union Department of MFA and relevant divisions in the line ministries are competent for AII.
Measures for Implementation of Priorities for 2013
Not provided, considering that it is the responsibility of Slovenia as the president of CEI as well as Se-
cretariat of AII in Ancona.
Measures Planned for period 2014-2016
EU Strategy for Adriatic-Ionian macro-region could be adopted in 2014 while concrete responsibilities
would ensue from the programme.
Overview of current and planning of foreign development assistance
Italy has provided 200 000 for co-financing projects within the AII framework. Areas of project co-
operation are areas for which protocols on cooperation in AII (development of small and medium enter-
prises) have been signed. As far as Serbia is concerned, one project where the project holder is from Serbia
(Tourist Organization of Serbia) has been granted, while four other projects include project partners from
Serbia.
MAARI (Migration, Asylum, Refugees and Regional Initiative)
Overview
The Republic of Serbia had been the chairman of regional initiative MAARI (Regional Initiative for
Migrations, Asylum and Refugees) in the period between April 2011 and April 2012. The Republic of Ser-
bia has shown significant activity and exceptional engagement related to the set priorities of the presidency.
Two priorities have been in the focus of the activities: 1) fight against human trafficking and 2) legal migra-
tions, i.e. diversion of illegal and unregulated migration to legal flows. A new network for cooperation
(Networking for Cooperation) has been formed in the area of prevention and fight against human trafficking.
Maximal effort has been put in further development of existing cooperation networks, the most important of
which are: 1. Network for cooperation of border police forces at international airports of the member states,
2. network for cooperation in the area of asylum, 3. network for cooperation in the field of visa and consular
services, base on previously signed Memorandum of Understanding in the field of consular services.

78
Administrative capacities
Existing administrative capacities are capable of providing satisfying support to the activities of the
Republic of Serbia within the MAARI framework. National MAARI coordinator is the representative of the
MI of Serbia. In the regional MAARI centre in Skopje, the liaison officer is the representative of the MI.
Measures for Implementation of Priorities for 2013
In coordination with the current president of MAARI, Bosnia and Herzegovina, as well as with other
countries in the region, the Republic of Serbia will work intensely on implementation of measures related to
prevention and control of illegal migrations with a view to manage migrations in a more efficient manner.
Serbia will continue to take concrete measures in order to further reduce the number of fake asylum seek-
ers abroad.
Overview of current and planning of foreign development assistance
Certain projects encompassed by MAARI are realized with the help of Switzerland and Liechtenstein
donations. MIDWEB project (Migration and Development in the Western Balkans) is being realized in co-
operation with IOM, based on the usage of IPA funds.
6. European Union Strategy for the Danube Region (EUSDR)
Overview
The Republic of Serbia has continued with intensive activities on implementation of the European Un-
ion Strategy for the Danube Region (EUSDR). Serbia is coordinating two priority areas of the Strategy: No.
16 infrastructure: Rail, road and air traffic, together with Slovenia and no. 7 science and economy of
knowledge, together with Slovakia. The Republic of Serbia is represented in all focal points.
The Republic of Serbia has made significant number of project proposals, and financial assistance for
their realization is expected from the new EU Programme (Danube Transnational Programme) starting from
2014.
Measures for Implementation of Priorities for 2013
With a view to initiate realization of certain Danube region projects, the Republic of Serbia has pro-
vided, in coordination with the EU, a portion of funds (around 19 million) that are given to Serbia based on
IPA for the following projects: Water treatment infrastructure in Veliko Gradite, revitalisation of Golubac
Fortress and infrastructure improvement projects for several municipalities in the Danube region.
Administrative capacities
Competent ministries and institutions relevant for the EUSDR are active within the scope of their
competence. Local government and Nongovernmental Organizations are also included in the realization of
the Strategy. National coordinator for EU Strategy, his deputy and special advisor have been determined.
Overview of current and planning of foreign development assistance
Besides the abovementioned projects, it is necessary to mention that certain Danube Region projects
are already financed from IPA funds, like for example NEWADA (Network of Danube Waterways Admini-
stration), followed by NELI (Cooperation Network for Logistics and Nautical Education), BIOREGIO (Inte-
grated Management of Biological and Landscape Diversity for sustainable regional development) and
SEERISK (Joint Disaster Management Risk Assessment and Preparedness in the Danube Macro region)
Certain development assistance for the Danube region municipalities has been provided by the Repub-
lic of Austria (through Austrian development agency).
7. International Commission for the Sava River
Overview
Serbia will be the chairman of International Commission for the Sava River until June 2013. Activities
are in order with Strategic Action Plan, as well as with declaration setting the guidelines for further imple-
mentation of FASRB (Framework Agreement on the Sava River Basin). In the area of sustainable develop-
ment in the Sava river basin, priorities for the development of sail, tourism and the usage of hydroelectric
power stations as a renewable source of energy have been set while further work has been done on integra-
tion of water protection and protection against floods and climate changes. Projects of Sava Commission
largely correspond with goals of EU Strategy for the Danube Region.

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Administrative capacities
Competent institution is the Republic Water Directorate within the Ministry of Agriculture, Forestry
and Water Management
It is important to mention that, during 2012, the Republic of Serbia has fully observed the International
Tisza River Basin Management Plan (ITRBMP). The Republic of Serbia is a member of the international
Tisza Group.
8. Viegrad Group (V4)
Overview
Viegrad Group (members: Czech Republic, Slovakia, Hungary and Poland) is actively positioned to-
wards 3B region, through diplomatic activities, projects promotion, and implementation of different pro-
grams.
Overview of 2013 Priorities
When initiatives of V4 countries towards WB countries are concerned, the Republic of Serbia supports
the idea of future creation of Western Balkans Fund, with a view to improve quality of life of the citizens in
the Western Balkans, through financing civil society and individual projects.
It is also interested in realization of Poland's initiative (currently presiding) for development of the
Western Balkans Expert Network on Rule of Law and Fundamental Rights.
Administrative Capacities
Division for regional initiatives of the MFA European Union Department and relevant divisions in the
competent ministries are dealing with these issues.
Measures for Implementation of Priorities for 2013
Not envisioned, considering that the consultation process related to the establishment of Balkan Fund,
and beginning of work of Western Balkans expert network on the rule of law and fundamental rights, has not
yet been finished.
Measures Planned for the Period 2014-2016
Not envisioned, considering that V4 WB states cooperation, and specific projects that ensue from
that cooperation, are determined based on the priorities set by the country currently presiding over V4.
Overview of current and planned foreign development aid
International Viegrad Fund is an international organization founded by the Viegrad Group (V4)
member countries' governments -Czech Republic, Hungary, Poland and Slovakia. Their main mission is en-
couragement of closer contacts and cooperation between the peoples in the region through financing of the
subsidy programs and individual stipends. The Fund's budget (from 2012) is 7 million. As far as Serbia is
concerned, by 2012, International Viegrad Fund has allocated it 475 890. In 2011 stipends of Viegrad
Strategic Program have been awarded in the amount of 27 500 as well as Viegrad university subsidies in
the amount of 14 000.
The budget of International Viegrad Fund is comprised from contributions of the V4 member coun-
tries (Czech Republic, Hungary, Poland and Slovakia) in the amount of 1.750.000.
9. Southeast European Law Enforcement Convention (SELEC)
Overview
During 2012 the Republic of Serbia has been active in implementation of the Regional Centre's South-
east European Law Enforcement Convention (SELEC), as well as programs and projects of Southeast Euro-
pean Cooperation Initiative (SECI). Considering the entry into force of the new Convention, the elections for
the new general director, director of operations and manager of Department for Legal and Internal Affairs
have been held.
Serbia is active in all work groups within the SELEC, especially in several specialized operational
groups (Task Force).
SELEC Centre provides support for the work of the special group of SEE countries' prosecutors
(SEEPAG).

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Administrative Capacities
Serbia has two representatives (liaison officers) in SELEC, one from the MI and one from the Cus-
toms Administration. SELEC activities are within MI and Customs Administration competence.
Measures Planned for the period 2014-2016
Drafting of the new strategic plan for activities has been planned, and with a view to achieve this, the
work of SELEC Council will be intensified.
The Issue of Refugees and Internally Displaced Persons
With a view to avoid interrupting the regional process of solving the problem of refugees and IDP
from 1991 - 1995 period, and encouraged by UNHCR, Serbia has organized international ministerial confer-
ence in Belgrade (March 2010), where drafting of common regional programme for housing care of the most
vulnerable refugees and organization of Donor Conference for collecting necessary resources has been
agreed on. Common regional programme (RP) was drafted by the representatives of BiH, Croatia, Serbia,
Montenegro, as well as UNHCR, European Commission, OSCE, Council of Europe Development Bank and
the government of USA. The program has been confirmed at the ministerial conference in Belgrade (No-
vember 2011). On the request of Montenegro, the program included IDP from Kosovo and Metohija in Mon-
tenegro from 1999. The budget of the RP amounts to 584 million for taking care of 74000 refugees, of
which 45000 of the most vulnerable refugees are in the Republic of Serbia. Program implementation in the
Republic of Serbia requires 335 million, of which 10% is contributed by Serbia.
The Programme duration is 5 years and it will provide several types of assistance for building and
repairing of apartments and houses, re-purchase of the village houses and provision of building materials.
Overview
At the International Donor Conference (Sarajevo, 24 April 2012) managed to collect 260,5 million in
total. The biggest donors are the EU (230 million) and USA ($10 million a year). The Donor Fund will be
managed by the Council of Europe Development Bank (CEB) that provides technical assistance, monitors
and represents a direct link between the donors and the participants in the process.
The procedure for forming managerial board of the Regional Programme based in Paris is ongoing,
with 4 countries, international organizations and donors participating in its work. This body was first inau-
gurated at the meeting that was held on 30 November 2012. CEB has also formed the Secretariat of the Re-
gional Programme and technical expert team that will be based in Belgrade and will provide technical
assistance in programme implementation to each of the countries.
Regional coordination forum has also been established (in which the representatives of the 4 countries,
international organizations (UNHCR, CEB, EC, OSCE)) whose goal is monitoring of the national pro-
grammes implementation and work of bilateral and regional working groups, which are part and parcel of the
regional process. The meetings would take place alternately in each of the countries of the region.
Overview of 2013 priorities
- holding of the initial meeting of the Regional Coordination Forum (January 2013, Podgorica)
- Realization of first national projects within Regional Programme (2 million for each of the 4 coun-
tries), pilot projects
- The possibility of establishing the Regional Coordination Centre based in Sarajevo is being consid-
ered (it would have a goal of enabling exchange of the data on potential users). It is expected that in-
ternational organizations provide opinion on the draft description of the Centres work, which is
something that the regional countries are interested in.
The Regional Programme should considerably contribute to improvement of the quality of life and to
solving of important issues related to the refugee status (personal documents, pension insurance, convalida-
tion of length of service, pension arrears). The biggest problem is the unpaid due pensions.
Bilateral Cooperation with the Countries in the Region
Serbia is firmly determined to fully develop relations with both its immediate neighbours and the other
countries in the region. This orientation comes from clear understanding that only stable and fully committed
cooperation can provide all the conditions for long-term sustainable development.
Starting from this position, as well as taking into consideration the fact that development of good
neighbourly cooperation is one of the key conditions in the process of Serbias European integrations , the

81
new government of the Republic of Serbia has, as one of the key priorities of its work, emphasized intensifi-
cation of political dialog with the neighbouring countries.
Bosnia and Herzegovina
Overview - Serbia is oriented towards full observance of Dayton Agreement as a basis for stability of
Bosnia and Herzegovina and the region and to respect BiH as a sovereign state, comprised of two entities
and 3 constitutive peoples. Serbia has stable bilateral relations with Bosnia and Herzegovina that is marked
by satisfying intensity of political dialog, by which cooperation possibilities have been opened on both inter-
national and regional levels.
Intensive political dialog at the highest level marked 2012 and reflected continuous good neighbourly
cooperation. Within the scope of common responsibilities that ensue from the Stabilization and Association
Agreement, Memorandum of Cooperation in European Integrations has been signed between the two states
(January 2013 in Sarajevo).
Economic Cooperation BiH is the most important foreign trade partner of Serbia according to the
value of export, while it is ranked 8th according to the value of import. Total commodity exchange between
the Republic of Serbia and BiH in 2011 amounted to 1333.1 million, of which the share of export was
852.6 million while share of import was 480.5 million. In the first 10 months of 2012, the commodity ex-
change amounted to 1032.3 million, of which the share of export was 706.2 million, while import from
BiH decreased to 18.1% in comparison to the same period 2011 amounting to 326.1 million. Serbia, with
840 million, is second largest foreign investor in BiH (total amount of all foreign investment in BiH is
around 5 billion).
Bilateral agreements until now there is total of 50 interstate agreements, protocols and memoranda
that were signed and entered into force, while we expect ratification and entry into force of the following
agreements: (1) Agreement on Cooperation in the Field of Tourism, (2) Agreement on Cooperation in
environmental protection and protection from other disasters, (3) Agreement on Cooperation between
the Republic of Serbia and the Council of Ministers of Bosnia and Herzegovina on temporary em-
ployment of the citizens of the Republic of Serbia in Bosnia and Herzegovina and citizens of Bosnia
and Herzegovina in the Republic of Serbia, (4) Memorandum between the Council of Ministers of the
Republic of Albania and the Council of Ministers of Bosnia and Herzegovina, government of the Re-
public of Macedonia, government of the Republic of Serbia, government of the Republic of Slovenia,
government of the Republic of Croatia and government of the Republic of Montenegro on payment of
debt of the Republic of Albania calculated on the basis of goods exchange between the Republic of Al-
bania and former Socialist Federal Republic of Yugoslavia, (5) Agreement between the Republic of
Serbia and Bosnia and Herzegovina on mutual representation in providing consular protection in
third countries and (6) Agreement between the government of the Republic of Serbia and the Council
of Ministers of BiH on inland waterways transport and technical maintenance of these waterways.
Overview of current and planned foreign development assistance EU IPA Programme for Cross-
border Cooperation between Serbia and Bosnia and Herzegovina EC has granted the program on the 18
December 2007, and in 2008 Serbia and Bosnia and Herzegovina established common program structures
Common Monitoring Board comprised of 16 representatives of the two states and Common Technical Secre-
tariat in Uice with a branch in Tuzla. Two public calls for project proposals have been issued so far with
223 projects received while 35 projects are in the process of realization or contracting. Projects are imple-
mented jointly by 100 non-profit institutions (municipalities, public companies, nongovernmental organiza-
tions, schools, sports societies etc) from border areas of both states.
Priorities further development of bilateral relations and intensification of political dialog, solving of
ongoing issues such as state border extension, return of refugees, succession, as well as increase in the scope
of economic cooperation.
Republic of Croatia
Overview - Considering that the quality of relations between the Republic of Serbia and the Republic
of Croatia is of key importance for the stability of the entire region, there is initiative to bring the relations
between the two countries to a higher level.
Above all, it requires intensification of the high-level dialog, categorization of outstanding issues and
the most significant fields of cooperation (divided in three groups), but also determining the mechanisms for
their resolution and improvement of cooperation.

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Renewal and intensification of the work of existing Mixed Committees for outstanding issues repre-
sents the basic method for solving of disputes from the past.
Economic cooperation Economic relations with the Republic of Croatia are mainly characterized by
positive developments. Total goods exchange is in constant rise and in 2011 it amounted to 687.6 million
which represents a 24.0% increase in comparison to 2010. In the period January-August 2012, Serbian ex-
port amounted to 198.9 million and is lower for 4.1%, while import from the Republic of Croatia amounted
to 259.0 million which represents an increase of 18.7%. In the period in question, total goods exchange
amounted to 457.9 million, which is 7.6% higher than in the same period last year. Due to upcoming ac-
cession of the Republic of Croatia to the EU, a new bilateral Agreement on Economic Cooperation has
been signed in 2009, that was ratified in the parliaments of both countries and it will enter into force
on the day of Croatian accession to the EU.
Bilateral agreements there are 39 bilateral agreements signed with the Republic of Croatia until now.
There are ongoing negotiations on signing of the Agreement on Air Transport, that will be the basis for es-
tablishment of regular airlines, as well as negotiation for harmonization of the text of the agreement between
the government of the Republic of Serbia and the government of the Republic of Croatia on inland water-
ways transport and technical maintenance of these waterways.
Overview of current and planned foreign development assistance EU IPA Cross-border Cooperation
Programme Serbia-Croatia European Commission has granted the program 2007, while in 2008 the Repub-
lic of Serbia and the Republic of Croatia have established common programme structures - Common Moni-
toring Board comprised of 15 representatives of the two states and Common Technical Secretariat in Zagreb
with a branch in Sremska Mitrovica. Two public calls for project proposals have been issued so far with
264 projects received while 29 projects are in the process of realization or contracting. Projects are imple-
mented jointly by 110 non-profit organizations (municipalities, public companies, nongovernmental organi-
zations, schools, sports societies etc) from border areas of both states.
Priorities The Republic of Serbia is interested in improvement of constructive political dialog and
creation of favourable conditions for long-term fundamental resolution of outstanding issues such as succes-
sion, border issues, return of refugees, pension issues and convalidation of length of service, right of occu-
pancy with Serbs, secret indictments, position of Serbs in the Republic of Croatia and missing persons.
One of the priorities is intensification of work of Interstate commissions with regard to resolution of
outstanding issues, but also improvement of economic and cultural cooperation in the process of European
integrations and cross-border cooperation of local governments.
Republic of Macedonia
Overview Bilateral political relations are regulated by The Agreement on Regulation of Relations
and Improvement of Cooperation from 1996, by which Serbia recognized the Republic of Macedonia under
its constitutional name. The abovementioned political relations can be characterized as good.
Since the formation of the government of the Republic of Serbia (July 2012), the cooperation has been
intensified by the visit of the president of Serbia Tomislav Nikoli (Skopje, October 2012) which set the ba-
sis for further advancement of all types of bilateral relations, including the visit of the prime minister of Ser-
bia Ivica Dai (Skopje, end of January 2013).
Realization of the visit of the Minister of Foreign Affairs I. Mrki to the Republic of Macedonia (Feb-
ruary 2013) is ongoing, when The Agreement on Cooperation within the process of accession to the Euro-
pean Union should be signed.
Economic cooperation Economic cooperation is one of the most developed forms of total bilateral
cooperation, taking into consideration that the Republic of Serbia is one of the most important foreign trade
partners of the Republic of Macedonia.
In 2011 export to the Republic of Macedonia amounted to 376.5 million, while import was 236 mil-
lion. In the period January-September 2012 total trade in goods amounted to 440.3 million and has in-
creased by 1.1% in comparison to the same period 2011.
Agreement on Economic Cooperation with the Republic of Macedonia was signed in June 2009 and
this Agreement envisions establishment of Mixed Committee for Economic Cooperation.
Bilateral agreements - bilateral agreements are accompanied by solid legal grounds, with reaffirmed
interest of both parties to further activities in this field with a view to improve bilateral cooperation as a
whole. 39 bilateral agreements and protocols are in force while 5 are in the procedure of entry into force.
Certain agreements have been negotiated for several years now: Agreement on Recognition of Diplomas,

83
Agreement on Property Rights; Protocol on using health care in military-medical facilities by the employees
of diplomatic and consular missions, their families and state delegations (Macedonian draft of the protocol
from 2007 is still being considered by the Ministry of Health of the Republic of Serbia); Agreement on Pro-
tection of Cultural and Historical Monuments (Macedonian side delivered the new text of the Agreement on
the 30th of September 2010.); Agreement on Protection of Military Grave Sites (sent for consideration to the
Macedonian side on the 4th of March 2010.); Agreement on Reciprocal Establishment of Cultural and In-
formative Centres (Macedonian side keeps bringing up this question in the dialog; they proposed to deliver a
draft of the Agreement which has not been done so far). As mentioned before, the signing of the Agreement
on Cooperation in the process of accession to the European Union between the government of the Republic
of Serbia and the Government of the Republic of Macedonia is being prepared, which is in line with the ob-
ligation ensuing from the Stabilization and Association Agreement between Serbia and the EU.
Priorities Development of the best possible relations with intensification of the political dialog in-
cluding overcoming existing differences and active involvement in addressing outstanding issues: Respecting
the rights of Serbian national minority in the Republic of Macedonia to freedom of religion and protection of
cultural and historical heritage of the Republic of Serbia. Furthermore, special attention has been directed
towards improvement of cooperation in the field of economic relations and cooperation in the field of Euro-
pean integrations of the two countries.
Montenegro
Overview- Through the high-level political dialog (visit of the president of the Republic of Serbia
Tomislav Nikoli on 18 January 2013), relations with Montenegro are progressing, but there is space for
their further advancement. All the highest officials of the two countries expressed common orientation to-
wards furthering and improving cooperation in all fields, in particularly in the field of economy and Euro-
pean integrations.
Economic cooperation Total trade in goods in 2011 amounted to 731.1 million. (which is by 4.5%
higher than in 2010), while in period January-October 2012 it was 608 million (export 528.5, import 79.5).
Serbia is one of the most important foreign trade partners of Montenegro and it achieves significant surplus.
Improving relations of the two countries can be expected in the field of economy and in realization of com-
mon infrastructure projects, mainly in the field of transport as well as in the energy sector. There is a consen-
sus of the two countries on important conditions that influence improvement of economic relations: free
movement of people, goods, services, capital, ideas, information and everything of interest for both countries'
economies. Particularly good cooperation is achieved in the field of energy, rail and metal industry.
Bilateral agreements present legal grounds are being continuously improved. Until now 23 agree-
ments entered into force while 12 others are in the process of ratification. Based on the bilateral agreement,
diplomatic and consular missions of the Republic of Serbia provide consular and legal services to the citizens
of Montenegro in the countries where Montenegro is not represented. Consular convention between the two
countries is signed on the 14 June 2012.
Overview of current and planned foreign development assistance EU IPA cross-border cooperation
programme European commission has granted the programme in 2007, while in 2008 Serbia and Montene-
gro established common program structures Common Monitoring Board comprised of 12 representatives
of the two countries and Common Technical Secretariat in Prijepolje with a branch in Bijelo Polje. Two pub-
lic calls for project proposals have been issued so far with 160 projects received while 29 projects are in the
process of realization or contracting. Projects are implemented jointly by 107 non-profit institutions (mu-
nicipalities, public companies, nongovernmental organizations, schools, sports societies etc) from border ar-
eas of both states.
Priorities Intensification of political dialog by meetings of representatives, prime ministers and min-
isters, with addressing outstanding issues between the two countries: border demarcation, dual citizenship,
status of Serbs and Serbian language in Montenegro, displaced persons from Kosovo and Metohija in Mon-
tenegro.
Romania
Bilateral relations Bilateral relations between the Republic of Serbia and Romania are good, based
on traditionally friendly relations of the two peoples. Officials of both countries have long been assessing the
relations as a model for good neighbourly relations. The question of protection of the right of national mi-
nority in eastern Serbia is taken into consideration, considering certain complains from the Romanian side
related to the dissatisfactory status of Romanian national minority. It is therefore very important that the two

84
sides, on the occasion of the visit of the Romanian prime minister to Serbia (October 2012), have agreed that
all outstanding issues should be addressed in a dialog with a view to further improve bilateral relations and
strengthen friendly relations. Besides that, there are ongoing informal consultations of the representatives of
the Republic of Romania and the Republic of Serbia on this issue in the format of Intergovernmental Mixed
Committees, and under auspices of the high representative of OSCE Knut Vollebk (the first meeting was
held in October, and final round of consultations will be held at the end of February 2013 in Hague).
Economic Cooperation Romania is an important economic partner of the Republic of Serbia, but the
level of economic cooperation does not reflect existing economic and natural resources and potentials of the
two countries. The most important segment of the economic relations is represented in trade in goods
that in 2011 amounted to 1.7 billion which puts Romania on the fifth position among the biggest foreign
trade partners of our country.
Bilateral Agreements legal basis for cooperation between the two countries is on the high level and it
can be said that the relations are characterized by a high number of bilateral agreements. Our country has 118
agreements signed with Romania, while there are two more in the process of ratification.
Overview of the current and planned foreign development assistance EU EU cross-border coopera-
tion programme between Serbia and Romania European Commission has granted the program in 2007
while in the same year Serbia and Romania established common programme structures Common Monitor-
ing Board with representatives of national, provincial and regional institutions and nongovernmental sectors
of both countries participating as well as Common Technical Secretariat in Timisoara with a branch in Vrac.
There were two public calls for project proposals which attracted total of 362 project proposals of which 91
projects were granted funds to be jointly implemented by around 220 Romanian and Serbian non-profit insti-
tutions (municipalities, NGO, public companies, schools...) from border areas of the two countries. Imple-
mentation of the programmes is regulated by bilateral Memorandum of Understanding.
Priorities Considering that improvement of bilateral relations with neighbouring countries represents
one of priorities of foreign policy of the Republic of Serbia, it is common interest for both sides to maintain
continuous political dialog on the high level, with a view to improve overall relations and find solutions for
possible outstanding issues.
Priorities for 2013 Negotiations for concluding the following agreements and protocols are ongoing
or upcoming: Agreement on Social Security/Insurance, Agreement on Protection of Military Grave Sites,
Protocol on Establishment of Common Office at Djerdap I Border Crossing Partile de Fier I, Agreement on
Cooperation in Preventing, Limiting and Alleviating Consequences of Natural Disasters, Agreement on Em-
ployment of Persons who Share Households with Members of Diplomatic and Consular Missions and Cross-
border Trade Agreement.
With a view to improve bilateral cooperation, common session of the two governments should be held
in the future period. It is necessary to maintain regular sessions of Mixed Committee for Economic Coopera-
tion and Mixed Committee for Minorities. It is necessary to continue high-level political dialog.
Hungary
Bilateral relations Bilateral relations between the Republic of Serbia and Hungary have been im-
proved through an intense high-level political dialog. Intensification of political dialog with Hungary was
initiated in October and November 2012, i.e. after formation of the new government of the Republic of Ser-
bia. Parliamentary cooperation is highly developed.
Economic cooperation is good, but below the level of political relations. Trade is the dominant form of
economic cooperation. In 2011 trade with Hungary amounted to 914.38 million (our export 249 million,
and import 665.38 million). In the past year and a half, economic cooperation has not been adequately im-
proved and there were no new Hungarian investments in Serbia. Agricultural cooperation is improving.
Hungary participated at agriculture fair in Novi Sad as the partner country, it was elected for
TWINNING partner in this field, and it provided apprenticeship for two officials of the Republic of
Serbia in its Agency for agrarian payments. The only institutional framework for economic cooperation of
our countries, on intergovernmental level, remains the Mixed Commission for Economic Cooperation.
Bilateral agreements Procedure of consolidation of contractual status has not been concluded. We
initiated internal procedure in order to form a list of contracts. Hungarian side expressed willingness to sign
bilateral protocol related to this segment of cooperation. 122 contracts entered into force while two are in the
process of ratification. Agreement between the governments of Serbia and Hungary on road, rail and river
control of the state border has been signed on 24 January 2012 and will entrer into force on 4 January 2013.

85
Overview of the current and planned foreign development assistance EU EU cross-border coopera-
tion programme between Serbia and Hungary European Commission has granted the program in 2008 and
in the same year Serbia and Romania established common programme structures Common Monitoring
Board with representatives of national, provincial and regional institutions and nongovernmental sectors of
both countries participating as well as Common Technical Secretariat in Budapest with a branches in
Subotica and Szeged. There were three public calls for project proposals which attracted total of 532 project
proposals of which 197 projects were granted funds to be jointly implemented by around 400 Hungarian and
Serbian non-profit institutions (municipalities, NGO, public companies, schools...) from border areas of the
two countries. Implementation of the programmes is regulated by the bilateral Memorandum of Understand-
ing.
Priorities By exchange of the high-level visits mutual interest in comprehensive development of bi-
lateral relations has been confirmed, while the Republic of Serbia is interested in strengthening of construc-
tive political dialog at all levels and exchange of visits, which would be useful for providing Hungarian
support for further steps of the Republic of Serbia towards membership in the European Union.
Priorities for 2013 Signing of the Agreement on Road Transport of Passengers and Goods.
With a view to improve bilateral cooperation, common session of the two governments should be held
in the future period. It is necessary to maintain regular sessions of the Mixed Committee for Economic Co-
operation and Mixed Committee for Minorities. It is necessary to continue high-level political dialog.
Republic of Bulgaria
Overview Relations between the Republic of Serbia and Bulgaria are stable and are characterized by
satisfying intensity of political dialog. The Republic of Serbia is oriented towards finding resolutions for
possible outstanding issues and towards cooperation with neighbouring countries as well as towards improv-
ing relations, which is one of the conditions for (faster) integration in the EU, which would, among other
things, provide support for our EU integrations.
Economic cooperation is mainly based on trade in goods, whose rate further increased during 2011,
with deficit on our side (our export 232.4 million, import 344.2 million). Bulgaria is among ten most im-
portant foreign trade partners of Serbia. In the field of energy, cooperation is based on exchange of electric-
ity, participation in regional and international organization and integrations in the process of establishment of
Southeast European electricity market and cooperation on projects of energy infrastructure development.
Memorandum on Gas Interconnection Serbia-Bulgaria has been signed in December 2012. Construction of
106 km long gas pipeline should start in 2013, while completion of work is expected in 2015.
Bilateral agreements the two countries have regulated almost all areas of bilateral cooperation by
contracts. Harmonization of the text of the new Agreement on Cultural and Educational Cooperation is ongo-
ing. Considering that there are several agreements from the period of SFRY that are still in force, it is neces-
sary to replace these bilateral agreements i.e. organize expert meetings between the services of the two
Ministries of Foreign Affairs.
111 agreements are in force while 10 are in the process of ratification. Agreement on gas interconnec-
tion between the two countries has been signed in December 2012 in Brussels.
Overview of the current and planned foreign development assistance EU EU cross-border coopera-
tion programme between Serbia and Bulgaria European Commission has granted the program in 2007
while the same year Serbia and Bulgaria established common programme structures Common Monitoring
Board with representatives of national, provincial and regional institutions and nongovernmental sectors of
both countries participating as well as Common Technical Secretariat in Sofia with a branch in Ni. There
were 2 public calls for project proposals which attracted total of 367 project proposals of which 123 projects
were granted funds to be jointly implemented by around 250 Bulgarian and Serbian non-profit institutions
(municipalities, NGO, public companies, schools...) from border areas of the two countries. Implementation
of the programmes is regulated by bilateral Memorandum of Understanding.
Priorities Development of bilateral relations through intensification of political dialog, as well as ac-
tive involvement in addressing, i.e. improving the status of minority in Serbia; as well as the question of bor-
der demarcation on the Timok river. Attention should be given to improvement of cooperation in all areas of
common interest, primarily to improvement of economic relations. Furthermore, the Republic of Serbia
could learn from Bulgarian experiences in the process of accession to the EU, especially in attracting and
realizing the resources from European development funds.

86
Republic of Albania
Overview - according to its permanent orientation towards resolving outstanding issues and improve
the relations with the neighbours with a view to accelerate European integrations, the new government of the
Republic of Serbia has decided to unblock the relations with Albania, thus creating conditions for gradual
improvement of bilateral cooperation. With this goal the visit of the MFA Ivan Mrki to Tirana was organ-
ized on 22nd and 23rd of October 2012 and it represents the first visit of a Minister of Foreign Affairs to Al-
bania. On this occasion, both sides expressed willingness to improve cooperation, especially in the field of
economy, as well as in other areas of mutual interest.
Minorities addressing the issue of Serbian minority and protection of its rights in Albania is a com-
mon interest, taking into consideration status of their national and cultural identity. Serbian minority remains
without the right to use its mother tongue, there are no schools, radio and TV programmes nor printed press
in Serbian. The Republic of Serbia is interested in concluding bilateral Agreement on Protection of Minority
Rights.
Economic cooperation Although economic cooperation is modest and it does not satisfy the needs
and the possibilities of the two countries, it is continuously improving, with trade surplus on the Serbian side
(in the period between January and October 2012, our export amounted to 58.5 million, while import
amounted to 9.3 million). Relatively positive development of cooperation in the field of economy in the
previous period was propelled by application of multilateral CEFTA Agreement (starting from 2007).
Priorities Consolidation of relations, protection of minorities and establishment of cooperation in the
fields of mutual interest, above all in the area of European integrations and improvement of economic coop-
eration.
Republic of Turkey
Overview Significant improvement in the relations between the Republic of Serbia and Turkey,
achieved during the last three years (since the visit of the president A. Gul to Serbia in 2009), has been con-
tinued with the policy of the new Serbian government, based on improvement of political dialog, regional
cooperation, as a component for stabilization and development of the Western Balkans countries accompa-
nied with the development of economic cooperation. Political dialog at the high level is developed and inten-
sified, while in addition to bilateral communication, there is a communication through triple meetings
(Republic of Serbia - Turkey - Bosnia and Herzegovina) between the ministers of foreign affairs and the
presidents. The new Government of the Republic of Serbia has intensified the relations and exchanged inter-
state visits of the highest level (In Belgrade and Ankara, at the end of January and beginning of February
2013).
Economic cooperation Despite the fact that the agreements on free trade and mutual visa abolition
have been signed and implemented, trade between Serbia and Turkey in the amount of approximately half a
billion American dollars, although doubled in the last couple of years, does not reflect the existing level of
political dialog and objective potential of both countries. Trade in goods in total continuously shows deficit
on our side, and thus our export in 2011 amounted to 131 million, while import was 292.6 million.
Priorities Priorities in the relations between the Republic of Serbia and the Republic of Turkey re-
main the same. Above all, they include initiation of meetings and cooperation with a view to improve eco-
nomic cooperation and investments with emphasis on increasing out export and attracting more investments
from Turkey, maintaining communication and meetings between the representatives of the two countries in
order to preserve the intensity of overall cooperation and improve general stability and prosperity of the re-
gion.
Republic of Greece
Political relations Bilateral relations are characterized by traditionally good political cooperation,
with no outstanding issues. This is confirmed by intensive and continuous political dialog. Greece is ex-
tremely important partner, who continually supports Serbia in all foreign policy priorities of strategic impor-
tance.
Economic cooperation Despite the fact that Greece is one of the biggest investors in Serbia (2.2
billion realized in the process of privatisation, through green field investments, as well as mutual invest-
ments), and foreign trade is stable, bilateral economic cooperation does not fully reflect real needs and possi-
bilities of the two countries, and it does not follow the level of political relations achieved. Due to negative
effects of economic crisis, one of the most important Greek investors in Serbia, OTE has withdrawn from the

87
Telecom ownership, selling its 20% of shares to the Serbian mobile operator for 380 million on the 26
January 2012.
Priorities Priorities in the relations between the Republic of Serbia and the Republic of Greece re-
main the same. Above all, it includes high-level and technical level meetings (regular sessions of the Com-
mittee for application of 2010 Memorandum on Cooperation between the two ministries of foreign affairs
towards acceleration of the process of European integrations of the Republic of Serbia) in order to maintain
Greek support to European integrations of Serbia, especially during its presidency over the EU in the first
half of 2014 as well as related to the issue of nonrecognition of the unilateral declaration of independence of
Kosovo. Initiation of meetings between businessmen and state representatives in order to further advance
economic, trade and investment cooperation.

1.3.2. International obligations


Cooperation with International Criminal Tribunal for the Former Yugoslavia
By extradition of the accused Goran Hadzi on 22 July 2011, the Republic of Serbia has terminated
cooperation with the Tribunal in terms of extradition of the accused persons. The Republic of Serbia has ex-
tradited 45 out of 46 accused for war crimes, whose extradition was required by the Tribunal, while one of
the accused has passed away before the extradition. Persons who are extradited to the tribunal include two
former presidents of the Republic, former president and vice president of the government, three former
Chiefs of General Staff of Yugoslav Army, former chief of the State Security Service and numerous army
and police generals.
The Republic of Serbia fully responded to almost all out of 2117 requests received for assistance to the
prosecution service of the ICTY.
The Republic of Serbia fully responded to almost all out of 1214 requests received for the assistance to
the defence of the accused in front of the ICTY.
None of the requests from the Tribunals prosecution and defence to enable access to the archives was
rejected.
More than 750 witnesses for who the Prosecution of the ICTY and the Defence of the accused in front
of the ICTY requested to be freed from the obligation to preserve secrecy in order to enable them to give
their testimonies in front of the Tribunal have been freed from the obligation to keep secrets.
All the requests of the Tribunal to deliver court summons and other writs to the persons residing
within the Republic of Serbia have been fulfilled.
All the requests of the Tribunal to provide protection for the witnesses residing on the territory of the
Republic of Serbia or on the territory where the Republic of Serbia has authority have been answered.
Conditions under which the accused persons were temporarily released were dully respected and in all
cases the accused persons were returned to the Tribunal in accordance with the decisions of the court panels.
According to the data from the Office of the War Crimes Prosecutor of the Republic of Serbia, 359
persons have been processed in front of the local competent bodies for criminal offences against international
humanitarian law so far.
The ruling of the Appeal court of the International Criminal Tribunal for Former Yugoslavia from 16
November 2012 by which the accused Ante Gotovina and Mladen Marka were acquitted from the responsi-
bility related to the crimes committed against Serbian civilians during the operation of Croatian Army under
the name Storm (Oluja), as well as the non-guilty judgment by the Trial Chamber of the International Crimi-
nal Tribunal for Former Yugoslavia from 29 November 2012 at the repeated trial for the accused Ramus Ha-
radinaj, Idriz Balaj and Lahi Brahimaj, led to bitterness of the Republic of Serbia which forced the Serbian
government to reduce cooperation with the Tribunal to a technical level. This means that the Republic of
Serbia will not stop the cooperation with the Tribunal, but in the future, it will only respond to the assistance
requests from the Tribunal Prosecutor as well as form the Defence related to granting access to documenta-
tion, archives and witnesses. However, on the other hand, after these rulings, Serbia will not participate in
organization and maintenance of any seminars, conferences, round tables and educational programmes on the
importance of the Tribunal and its contribution to the process of confronting the past.
Recommendations of the European Commission from the 2012 Annual Progress Report for Serbia re-
lated to the continuation of activities in discovery of the network of aids to the persons accused in front of
the Tribunal are acknowledged.. The main prosecutor of the International Criminal Tribunal for Former

88
Yugoslavia has been fully informed on the activities of the Serbian Office of War Crimes Prosecutor in this
field.
A preliminary investigation procedure against two persons because there is reasonable doubt that they
provided assistance to the Hague indictee Stojan upljanin during his hiding is ongoing. Besides that, the
procedure in front of the First basic court in Belgrade against 10 persons accused for providing assistance in
hiding of the Hague indictee Ratko Mladi in the period from 1 June 2002 until February 2006 is ongoing.
In all other cases, criminal proceedings have been completed by concluding agreements on confes-
sions of criminal offences that were validated by the rulings of the Higher Court in Belgrade War crimes
chamber. Thus, on the 20 September 2012 the Office of the War Crimes Prosecutor of the Republic of Serbia
has concluded the agreement on confession of criminal offence with Miroslav Jegdic, that was verified by
the final conviction of the Higher Court in Belgrade War Crimes Chamber, thus imposing suspended con-
viction to Miroslav Jegdic for the criminal offence of helping perpetrator after committing criminal act from
Article 333, Paragraph 3 of Criminal Code of the Republic of Serbia by issuing him 6 month prison sentence
that will not be executed if the accused does not commit a new criminal offence in the next 2 years. Jegdic
has been providing help to the indictee Ratko Mladi who stayed with Jegdic in the village of Mala
Motanice in the period from February 2006 until April 2006.
Agreement on confession of criminal offence has also been concluded with Branislav Mladi on the 2
August 2012. Namely, it has been determined that the indictee Ratko Mladi on the 7 April 2006 had gone to
the village of Lazarevo where he had been hidden by his close relative until 26 May 2011 when he was ar-
rested. Based on this Agreement the Higher Court in Belgrade War Crimes Chamber has on the 14 August
2012 imposed suspended conviction by sentencing Branislav Mladi, for the criminal offence of helping per-
petrator after committing criminal offence from the Article 333, Paragraph 3 of the Criminal Code of the Re-
public of Serbia, to one year imprisonment that will not be executed provided that the indictee does not
commit another criminal offence in the following 3 years.
In terms of hiding of Stojan upljanin, on the 20 September 2012 the Office of the War Crimes Prose-
cutor of the Republic of Serbia has concluded the agreement on confession of criminal offence with Vladimir
Lijeski, that was verified by the final conviction of the Higher Court in Belgrade War Crimes Chamber,
thus imposing suspended conviction to Miroslav Jegdic for the criminal offence of helping perpetrator after
committing criminal act from Article 333, Paragraph 3 of Criminal Code of the Republic of Serbia by sen-
tencing him to 6 month imprisonment that will not be executed provided that the accused does not commit
another criminal offence in the next 2 years.
The Office of the War Crimes Prosecutor of the Republic of Serbia has concluded the Agreement of
confession of the criminal offence (25 December 2012) with Ljubia Lazi. The hearing regarding this
Agreement is scheduled before the Higher Court in Belgrade for the 13th of February 2013.
Finally, it is important to emphasize that seven of nine persons who were listed in ifrarnik, the cipher
book of Stojan upljanin that was found in his possession after his arrest on the 11 June 2008 in Panevo has
concluded agreements on confession of criminal offence.
It is important to mention that it has been determined that the indictee Radovan Karadzic had been
helped by his closest family members who according to the law can not be processed because of their close
relation to the indictee. To be more precise, the person in question is his brother Luka and his closest family
members.
The trial against 10 persons indicted with helping in hiding Ratko Mladi has been continued before
the First Basic Court in Belgrade. Indictees are Stanko Risti, Ljiljana Vaskovi, Borislav Ivanovi, Predrag
Risti, Saa Badnjar, Ratko Vueti, Tatjana Janjuevi, Bojan Veskovi, Marko Lugonja and Blagoje Gov-
edarica. The main organizer of Ratko Mladi's hiding, retired colonel of the Republic of Srpska Army Jovo
Djogo passed away on the 17 August 2008, thus proceedings against him had been closed. Due to illness of
one of the indictees, the trial has been postponed for 12 March 2013.
Representatives of the Serbian Office of War Crimes Prosecutor and the Prosecutors Office of Bosnia
and Herzegovina have on the 23 November 2011 aligned the text of the special protocol on cooperation of
war crime prosecutors in prosecution of suspects accused of war crimes, crimes against humanity and geno-
cide. Negotiations have been conducted with the support of EU delegation, USA Embassy and OSCE repre-
sentatives. The Protocol on Cooperation of the Office of War Crimes Prosecutor of the Republic of Serbia
with the Prosecutor's Office of Bosnia and Herzegovina has been ratified on the 21st of December 2012 at
the office of the EU Delegation to Serbia in Belgrade.
The mentioned protocol has officially been signed on the 31 January 2013 in Brussels.

89
Proceedings before the International Court of Justice
Proceedings before International Court of Justice based on the suit of the Republic of Croatia against
the Republic of Serbia (and the counter suit subsequently filed by Serbia) for violation of the Convention on
the Prevention and Punishment of the Crime of Genocide - Croatia v. Serbia) are ongoing.
The proceedings have been initiated on the 2 July 1999 by the Republic of Croatia against SRY. SR
Yugoslavia has in 2002 made preliminary objections related to the competence of the Court to decide in this
dispute (considering that at the time when the proceedings were initiated SR Yugoslavia was not the member
of the UN, nor the contractual party of the relevant Convention). The Court has, after several postponements,
on the 18 November 2008 decided that it is competent to decide on this matter.
Political attempts to solve the dispute outside of the court failed, despite that the Republic of Serbia
met several specific requests of the Republic of Croatia. Therefore, the government of the Republic of Serbia
has on the 20 November 2008 decided that the Ministry of Foreign Affairs initiate measures for preparation
and filling of a counter suit in this dispute, in order to contribute to determining the truth on the conflict and
the crimes committed at the territory of Croatia from 1991 to 1995 and in order to improve the position of
the Republic of Serbia in this case. The answer to Croatian suit, with the countersuit request has been filed
on the 4 January 2010.
Cooperation of the Republic of Serbia with the International Criminal Court
The Republic of Serbia, i.e. Federal Republic of Yugoslavia has signed the Roma Statute of the Inter-
national Criminal Court on 19 December 2000 and was ratified on 6 September 2001 (as 38th member state).
Agreement on Privileges and Immunities has been signed by the Republic of Serbia on the 18 July 2003 and
ratified on 7 May 2004 (as the seventh member state).
After ratification, these legal documents have become part and parcel of the internal legal order and
the Republic of Serbia has undertaken comprehensive activities in order to align them with national legisla-
tion. In September 2009 the Law on Cooperation with the International Criminal Court has been adopted and
published in Official Gazette of RS", no 72/2009 from 3 September 2009.
The Republic of Serbia has in January 2011 signed the Agreement with the International Criminal
Court that provides the possibility for persons convicted by the ICC to serve imprisonment in the Republic of
Serbia. The Law on confirmation of this agreement has been published in Official Gazette of RS interna-
tional agreements, no. 3/2011 from 9 May 2011. The Republic of Serbia is the first state in the Southeast
Europe who signed such an agreement with ICC.
Representative of the Republic of Serbia participated in the 11th session of the ICC's Assembly of
States Parties that was held in the Hague from 14 until 22 November 2012. Elections for the deputy prosecu-
tor and the first time for the 9 members of the Advisory Committee on Nominations were held at the men-
tioned session.

2. ECONOMIC CRITERIA

2.1. The existence of a functioning market economy


2.1.1. Wide political consensus on the basics of economic policy
In Serbia, there is a wide political consensus on the fundamentals of economic policy. In a difficult
economic and social situation, a coalition agreement at the government level and a social agreement between
the government, employees and employers have been reached confirming that the economic policy should be
oriented towards development, directed towards rehabilitation and strengthening of the economy and im-
provement of the qaulity of life of the impoverished citizens of Serbia. Development-oriented economic pol-
icy is a result of the agreement between the state, economy and trade unions based on the principle of active
partnership in the work of Social and Economic Council of the Government.
By conducting development-oriented economic policy the Government demonstrates its commitment
to development of partner relations with the economy and establishment of a stimulative environment for
investors and businessmen, with a view to create better business conditions in relation to our environment
and contribute to increased competitiveness of our companies and credibility of the country. In this regard

90
the state will pay special attention to creation of conditions for greater stability of the national currency,
more favourable price of the capital, more efficient administrative procedures, foster economy and export
and increase agricultural subsidies. These measures will enable the recovery of Serbian economy helping it
to exit the crisis more balanced and ready to continue sustainable development that would be in line with the
level of the EU income, which is the final goal of Serbian economy.
Economic policy of the Government is oriented not only towards development, but also towards sav-
ings. According to this, in the conditions of economic crisis, the state and financial sector have a crucial role
in fostering national economy, above all, new investment development cycle that would include agriculture
and food industry, energy and infrastructure. Similarly, attracting foreign investments is an important prior-
ity for revitalization of Serbian economy. Decrease of irrational public spending and increase of investment
spending as key priorities of fiscal policy will make significant contribution to stimulation of growth and
growth of employment rate. Eliminating unproductive expenditure will enable greater investment in devel-
opment and creation of new jobs. With this in mind, measures for reducing fiscal deficit and public debt as a
means to achieve macroeconomic stability and sustainable development have been adopted.
Important role in determining and implementing economic policy of the Government is played by the
trade unions through activities in the Social and Economic Council of the Republic of Serbia and in the Re-
public Agency for Peaceful Settlement of Labour Dispute, and not by means of strikes and court proceed-
ings. In this manner through active partnership of the Government, economy and trade unions the burden of
economic crisis and transition expenditures are shared by all social groups, with the protection of socially
vulnerable citizens.

2.1.2. Macroeconomic Stability


Overview
In Serbia, there is a wide political consensus on the fundamentals of market economy. In the previous
transitional period Serbia has undertaken important steps towards establishment of functioning market econ-
omy and reached certain level of macroeconomic stability that allows for companies to make business deci-
sions in a predictable environment. Free interplay of market forces has been developing through the process
of privatization and trade and prices liberalization and the process of eliminating obstacles for entering and
exiting the market.
In terms of meeting economic criteria Serbia will make further efforts towards restructuring of the
economy and improving business environment, especially through strengthening of the rule of law and re-
moving administrative obstacles, strenghtening competition and the role of private sector and by creating
more flexible conditions at the labour market. Serbia will accelerate structural reforms in order to improve
economic productivity and business climate that will enable growth of investments and thus increase ability
of the economy to sustain the pressure from the competition and the EU market forces.
Macroeconomic movements in the 2010-2011 period
After the recession in 2009 and the decrease of GDP by 3.5% in 2010, the economic growth of 1.0%
led by net export has been reported. The mentioned period is characterized by the change of GDP structure
and a decrease of current account deficit.
In terms of expenditures, the growth of GDP in the period before the crisis has been led by spending,
which significantly increased the level of current account deficit that in 2008 amounted to 21.6% of GDP.
High current account deficit has been financed primarily by high capital inflow mainly from privatizations.
This trend was set by world economic crisis, when deficit decreased to one third of its 2008 level.
Net export has made the biggest positive contribution to the GDP movement in 2009 and 2010, which
was influenced by real depreciation of the dinar and decrease of domestic expenditure in the mentioned pe-
riod. Nominal growth of export of goods and services 2010 in Euros amounted to 18.8%, while real growth
was 12.1%. On the other hand, import of the goods and services was nominally higher by 9.2%, while real
growth was 2.5%. The result of this was the contribution of net export to the economic growth with 2.6 pp in
2010. On the other hand, the decrease of private expenditure has continued and it gave negative contribution
of -0.9 pp to the GDP growth. Due to the growth of net export and low domestic demand, the current account
deficit was 6.7%.
High y-o-y rates of economic growth were reported in the first two quarters of 2011 when the growth
of GDP was 2.9% and 2.4% respectively. However, in the second half of the same year, global economic
activity significantly dropped which was mainly propelled by the deepening of the public debt crisis in the

91
Euro zone. In the deteriorated conditions in the third and fourth quarter, the real GDP growth of 0.7% and
0.5% has been achieved. Overall in 2011, the economic growth of 1.6% has been reported and in terms of
expenditure it was led by real growth of investments by 27.1%, while the net export made a negative contri-
bution to the GDP growth, primarily due to the growth of equipment import in export-oriented sectors. In-
creased equipment import has led to a greater participation of the current account deficit in GDP that
amounted to 8.9% in 2011. Financing of the greater current account deficit was made possible by increased
inflow based on FDI and portfolio investments.
In the field of employment and labour market, in the period since 2010, negative trends have been re-
ported. By April 2010 the unemployment rate already was 19.2% which was significantly higher than in Oc-
tober 2009 when it was 16.6%. Until the end of 2010, the unemployment rate has not increased, but negative
trends continued in 2011. According to the labour force survey from April 2012, the unemployment rate was
25.5%.
In the period from 2010, inflation was mostly influenced by foods prices. Considering high participa-
tion of food in consumer price index, inflation in Serbia is particularly vulnerable to the change in prices of
these types of products. From the middle of 2010, y-o-y inflation has been growing and in October it ex-
ceeded the upper limit of allowed fluctuation margins. Inflationary pressures are mainly the result of signifi-
cant growth of food prices. Moreover, the growth of inflation has been caused by depreciation of the dinar
from the previous period and the growth of inflation expectations. The growth of food prices was a conse-
quence of the bad agricultural season at the global level, which cause the growth of food prices in the world.
Besides that, due to inadequate system solutions, the food prices in Serbia are significantly more unstable
than that in neighbouring countries, which influenced their higher growth in the second half of the year. The
National Bank of Serbia has in the given period, reacted with the measures directed towards preventing
transfer of the effects of the agricultural shock to the inflation expectations.
During 2011, Y-O-Y Inflation has been moving above the upper limit of allowed fluctuation margins.
The reasons for this are the mentioned increase in the food prices due to agricultural shock from 2010 and
base effect from the previous year. Y-O-Y inflation has reached its maximal value (14.7%) in April 2011,
after which it started decreasing after which it returned to the allowed fluctuation margins in January.

Overview and the most important activities in 2012


Economy of Serbia in transitional period from 2001 to 2008 has reached average growth rate of 4.9%
with the growth of macroeconomic imbalances that at the end of 2008 reached economically unsustainable
levels. Foreign trade deficit and current account deficit amounted to 27.7% of GDP and 22.1% of GDP, re-
spectively. Fiscal deficit was 2.6% of GDP. Inflation reached 8.6% at the end of the year.

92
Macroeconomic imbalances have decreased in 2009 as a result of global economic crisis. Inflation was
6.6% at the end of the year as a result of the decrease in domestic demand. Foreign trade and current account
deficits have been reduced to 19.1% of GDP and 7.3% of GDP respectively as a result of the greater decrease
of import in comparison to export. Fiscal deficit increased to 4.5% of GDP as a result of a lower economic
activity and lower public revenues. Economic and monetary policy measures have mitigated recession ten-
dencies and prevented greater macroeconomic and financial instability.
Global financial and economic crisis has discovered the vulnerability of Serbian economy whose
growth is based on domestic demand financed by revenues from privatization of socially-owned and state-
owned capital and extensive foreign loans, primarily in private sector. The crisis has shown weaknesses of
consumer-oriented growth model and limitations of the economic policy based on it that was not able to ade-
quately respond to external shocks and structural weaknesses of the economy whose impact on the economic
growth of the country remains negative.
In these circumstances, Serbian economy has slipped into recession in 2009, and after a fragile two-
year recovery, has weakened again in 2012. Expansive public expenditure in the first half of 2012 resulted
in growth of inflation and current account deficit and did not lead to the growth of GDP. Real GDP has de-
creased to 2% in 2012 according to estimations. Inflation has reached a high level of 12.2%. The unem-
ployment rate, according to LFS from October 2012, was at high 22.4%. Current account deficit will have a
high share of 11% of GDP. Fiscal deficit and public debt will have unsustainably high levels of 6% of GDP
and 65% of GDP, respectively.
Previous year, 2012 has been characterized by unfavourable macroeconomic movements - decrease of
economic activity, growth of inflation and current deficit, fiscal expansion. The decline in economic activity
by 2.0% is expected n 2012, which is a sole responsibility of the decline in agricultural production (-2.0 pp).
Unfavourable economic movements are largely the result of recession in the Euro zone and a significant
slowdown in the economies of the countries in the region. In terms of expenditures, negative contribution to
GDP is a result of private investments and private expenditure, while positive contribution was a result of net
export and government expenditure.
First half of 2012 has been characterized by high fiscal expansion, which forced the new Government
to adopt strong measures for fiscal consolidation immediately after its formation, which should cut fiscal
deficit in 2013 in half and restrain fast growth of public debt.
Increased government expenditure in the first half of the year resulted in the growth of import and
therefore higher current deficit, which exceeded 14% of GDP in this period, which significantly influenced
depreciation of the dinar. However, expansion of automotive industry, fiscal consolidation measures and
depreciation from the first half of the year contributed to significant decrease of the current account deficit in
the second half of the year. At the annual level, it is expected that the share of the current account deficit in
GDP will amount to 10.6% of GDP which is primarily the result of the growth of expenditures based on in-
terest rates repayments.
Political insecurity, temporary interruption of the arrangement with the IMF, recession in the Euro
zone and a single-stage capital outflow in the telecommunications sector, has also contributed to a significant
drop in foreign direct investments, whose net value in 2012 was estimated at 200 million. However, con-
sidering that the majority of mentioned factors is temporary, and taking into consideration announcements,
during the next year foreign directed investments are expected to rise to approximately 1.2 billion.
Poor agricultural season, weakening of the dinar from the first half of the year, with the increase of
VAT and excises, have since May conditioned a strong inflation increase, that was moving significantly
above the targeted 41,5%. National Bank of Serbia has been taking restrictive monetary policy measures
since June due to growth of inflationary pressures, and reference rate as its basic instrument is currently
11.25%.
Taking into consideration macroeconomic trends, starting from August, economic policy of the Gov-
ernment is directed towards fiscal consolidation and initiated by the revision of the budget of the Republic
and by adopted fiscal measures. In terms of revenues, the most important measure is increasing of tax rates
for indirect taxes, while in terms of expenditures the most important measure is limiting of growth of pen-
sions and salaries in the public sector.
The most important activities in 2012 in the field of public finances related to economic stability are:
- Adopting the Law amending the Law on Budget of the Republic of Serbia for 2012 and the set of
accompanying laws related to implementation of fiscal consolidation (Official Gazette of RS, no
93/12)

93
- abolishment of own source revenues of the budget beneficiaries and integration of all revenues and
expenditures in the budget process, which provides more efficient spending of these resources
through better planning and control;
- Elimination of 138 redundant state-level and local government-level parafiscal levies that repre-
sented a burden to the economy and citizens and abolishion of 7 redundant agencies, funds and
regulatory bodies;
- Limiting the growth of salaries in the public sector and pension to 2% in October which is in line
with the budget possibilities.
- alignment of the rules for calculating salaries in the entire public sector and determining the maxi-
mum monthly salary in public sector in nominal net value of RSD162.740.
- Adoption of the Law on Budget of the Republic of Serbia for 2013 and the set of accompanying
laws regulating deadlines for payments in commercial transactions, conditional tax amnesty, late
payments and similar, with a view to improve liquidity of the economy and stabilize public fi-
nances (Official Gazette of RS, no 119/12).
Priorities for 2013
Economic policy in 2013 will be directed towards macroeconomic stability as a key condition for the
economic growth and increase of employment rate.
Recovery of agriculture and further expansion of automotive industry will be main factors that will,
despite bad conjuncture in the international environment, lead to the growth of GDP by 2.0% in 2013. The
most important positive contribution to the growth of GDP is expected from net export as a result of expan-
sion of automotive industry and other export-oriented sectors. Negative contribution will be the result of
final private sector expenditure and final government expenditure, while both private and state investments
will have a positive contribution. In 2014 the main growth generator will be the expected recovery of the
Eurozone and the countries in the region. Acceleration of economic growth is expected in 2014 and 2015.
Announced and initiated measures of fiscal consolidation, expansion of automotive industry as well as de-
preciation from the previous period will influence improvement in the state of current account deficit in 2013
and the following two years.
NBS will in future period remain committed to ensuring price stability in medium term. Decline in in-
flation is expected to start from the second quarter and its return within the allowed fluctuation margins is
expected at the end of 2013 (41,5%). Beside restrictive measures of the National Bank, this will be the re-
sult of the expected decline in the food prices with the new agricultural season, low aggregate demand as
well as measures of fiscal consolidation. In the absence of larger shocks inflation should remain within the
allowed fluctuation margins during 2014.
Planned inflation for 2013 is 5.5%, which is significantly lower than the estimated inflation of 13.8%
for 2012.
Strenghtening of macroeconomic stability through better coordination of monetary and fiscal policy is
envisioned for 2013 with a view to provide:
- Decline in inflation to 5.5% (December 2013/December 2012);
- Decline in fiscal deficit to 3.6% of GDP at the end of 2013;
- Decline in current account deficit to 9% of GDP at the end of 2013.
Key role in strenghtening of macroeconomic stability in 2013 will be played by fiscal consolidation
and monetary policy. Special contribution to this will by made by extended effects of the fiscal consolidation
measures adopted both in terms of revenues and in terms of expenditures at the end of September 2012,
which will in 2013 make key contribution to decline in fiscal deficit.
Continuation of sharp fiscal adjustment in 2013 will, along with restrictive monetary policy directed
towards decline in inflation, help inflation reduce the pace of growth and return to projected margins in 2013.
Measures Planned for the period 2014-2016
In the Republic of Serbia the widest consensus is reached that macroeconomic stability, which in-
cludes both internal and external stability, is of key importance for establishment and functioning of market
economy and for sustainable economic growth, since it creates the climate of predictability for companies.
Therefore, in the future period special attention will be given to establishment and maintenance of macro-
economic stability that includes proper price stability, sustainability of public finances and balance of pay-

94
ments sustainability, which can be seen in the table below that points out significant decline in macroeco-
nomic imbalances (inflation, external imbalances, fiscal deficit and the level of public debt) at the end of
2016.
Macroeconomic Stability Indicators
2012 2013 2014 2015 2016
Inflation, the end of the period, in % 13,8 5,5 5,0 4,5 4,0
Inflation, average of the period, in % 7,5 11,1 4,8 4,5 4,0
Deficit of foreign trade account, % GDP -18,9 -16,2 -14,4 -12,8 -11,0
Current account deficit, % GDP -11,0 -9,0 -7,9 -7,0 -6,0
Consolidated fiscal deficit, % GDP -6,1 -3,6 -1,9 -1,0 0,0
State sector debt 65,1 65,2 58,7 58,4 56,9
Economic policy is oriented towards creating conditions for long term sustainable macroeconomic
stability, which is related to the Stabilization and Association Process of Serbia and meeting the require-
ments for full EU membership.
With this regard, sustainable macroeconomic stability requires achieving low and stable inflation rates
and decline in fiscal and balance of payments imbalances. Credible economic policy thus creates an envi-
ronment for stability and growth of the economy, while the key role in this is played by fiscal policy directed
towards credible medium term fiscal adjustment by lowering current government expenditures.
Fiscal adjustment as a condition for macroeconomic stability is supported by amendments to the Law
on Budget System which sets tight fiscal rules related to government expenditures, fiscal deficit and public
debt.
General and specific fiscal rules have been determined in 2010 by amendments to the Law on Budget
System (Official Gazette of RS, no 73/10). Fiscal rules have been adopted with a view to provide long term
sustainability of fiscal policy through planned decline in current budget spending, salaries and pensions in
public sector and increase of public investments in the first place, in order to eliminate fiscal deficit the state
level in 2016 and decrease share of public debt in GDP to 45% in 2020. For application of fiscal rules and
improvement of fiscal policy credibility,of the importance is establishment of Fiscal Council as an inde-
pendent state body that gives opinions and drafts fiscal strategy and assesses alignment of the fiscal policy
with the fiscal rules.
In order to establish and maintain macroeconomic stability, besides fiscal adjustment, it is necessary to
retain the existing monetary regime whose main purpose is inflation control and therefore flexible exchange
rate. Targeted inflation regime and exchange rate flexibility allow for turning of Serbian economy towards
investments in sectors of tradable goods and increase of export. Low and stable inflation and stabilization of
the dinar at its real value are simulative for investments, exports and economic growth.
Coordination between monetary and fiscal policy is especially important for macroeconomic stability.
It will be reinforced in post-crisis period when the growth of domestic and foreign demand occurs which will
influence the inflation. It is desirable to combine relaxed monetary policy that would stimulate the private
sector with lower interest rates and responsible fiscal policy that provides decline in the level of government
expenditures, lower fiscal deficit and lower level of public debt.
Key conditions for establishing and sustaining macroeconomic stability are:
- Implementing market reforms and completing the transformation of economy with dominant pri-
vate sector, market orientation, strengthening of economic liberties and entrepreneurship, simula-
tive business and investment environment.
- Accelerated and stable recovery of the economy after the recession and return to higher and sus-
tainable rates of economic growth based on the increase of export, investments and employment,
with modernization of national economic infrastructure, primarily, energy, traffic and telecommu-
nications.
- Establishment of declining inflation trend and its reduction to a low and stable level through the
monetary policy regime,
- Fiscal adjustment and fiscal deficit reduction to a sustainable level, which will depend on the growth
of economic activity and import and on ability to reduce certain public expenditures.

95
- Adjustment of current account deficit and reduction of external imbalance based on the export
growth, external payments, level of domestic expenditures, capital inflows of private sector and fi-
nancial support of international financial organizations and the EU.

2.1.3. Prices and trade liberalization


Prices
Overview
1. Prices of medicines. Legal basis for control of the medicines price is contained in the Article 58,
Paragraph 1 of the Law on Medicines and Medicinal products (Official Gazette of RS, No 30/10 and
107/12). The Government has in November 2012 adopted the Regulation on the Criteria for Pricing of Medi-
cines for Human Use which are Issued on Prescription (Official Gazette of RS, no 108/12) and the Decision
on hHghest Pricing of Medicines for Human Use which are Issued on Prescription (Official Gazette of RS,
no 108/12). This Regulation sets the criteria for both wholesale and retail pricing of medicines for human use
issued on prescription, which have been issued marketing certificate from the Medicines and Medical De-
vices Agency of Serbia. In the future it is expected that only the prices of the medicines that are issued on
the expenses of the Health Insurance Fund will be controlled.
The share of medicines, whose prices are determined by the Government within the consumer price
index, is 2.3%, the same as in 2011.
2. Prices in the field of energy The prices of electricity and natural gas for tariff buyers are regulated
by the Energy Agency of the Republic of Serbia, as an independent regulatory body, while concluding with
the 1 October 2012, the Government of the Republic of Serbia has also been supervising them. Total share
of controlled prices in the field of energy in 2012 was 8.0% (electricity for households participates with
7.17%, while natural gas for households participates with 0.85%), which was 0.2% higher in comparison to
2011.
3. Prices of services of public companies operating in the field of infrastructure In the period from
November 2011 to November 2012 the list of services of public companies operating in the field of infra-
structure, whose prices were controlled, i.e. regulated, remained unchanged, while the amount of services,
that are statistically recorded and whose share10 can be calculated, in 2012 increased for only 0.01%,
amounting to 2.37% (of which only 0.05% is related to postal services and internal rail traffic services that
are priced after the agreement of the Government , while prices of services of fixed telephony and telephone
subscription are approved by the Republic Agency for Economic Communications.
4. Prices of products and services of public companies founded by local government units Prices of
mentioned products and services are still under administrative control according to the Regulation on the
procedure to temporarily suspend the transfer of funds from the budget of the Republic of Serbia to the local
authority, and/or transfer of the related income tax and corporate tax to the Autonomous Region (Official
Gazette of RS, no 6/06 and 108/08). This regulation limits the allowed increase of local companies prices up
to the level of projected price increase that is determined annually by the Government, until the necessary
alignment with the projected price increase for that year is performed. The total share of the prices of com-
munal and housing services and public transport has increased in the statistical list of consumer prices
amounting to 4.05$ in 2012 while in 2011 it was 3.82%.
Based on the new Law on Public Enterprises (Official Gazette of RS, no 119/12), and starting from
th
17 of December 2012 amendment to the existing Regulation on transfer of transfer funds, that no longer
envisions control of the prices of these products and services, but only the level of salaries.
5. Prices of technical inspection of the vehicles, vehicle removal fee, training and passing driving test
Based on the Law on road safety (Official Gazette of RS, no 41/09, 53/10) the Government has at the end of
2009 passed a decision which sets the prices for the technical inspection of the vehicles and the fee for vehi-
cle removal (Official Gazette of RS, no 109/09) widening the scope, i.e. list of products and services whose
pricing is regulated by the Government by 0.15%). Similarly, the Government has passed a Decision on set-
ting the lowest price for theoretical and practical training of the driving candidates and the lowest price for

10
Prices of services of one of the operators of cable network (Serbia Broadband d.o.o.) are controlled due to significant
market force at the market; they are controlled by RTA, while the share of this operator only in the consumer prices
index cannot be assessed.

96
passing driving test (Official Gazette of RS, no 105/12), which widened the scope of controlled prices for
additional 0.54%.
Commission for Protection of Competition has, in cases of the Law on cargo transport in the road
traffic, Law on Road Transport, Law on Road Safety, Law on Amendments to the Excises Law, pointed out
that legal provisions related to determining minimal prices for services/goods are not in alignment with the
provisions of the Competition Law and fundamental principles of free market economy. (See also3.8 Com-
petition policy;
Administrative capacities
In the Sector for Trade, Services, Prices and Consumer Protection within the Ministry of Foreign and
Internal Trade and Telecommunications, there is the Department for Prices comprised of four employees
who cover the area of medicines prices, energy prices, infrastructural activities prices and prices of products
and services of the companies founded by local government units and the department head.
Trade liberalization
Overview
Process of foreign trade liberalization in Serbia has intensified in the previous decade with conclusion
of a set of bilateral and multilateral free trade agreements.11 By application of these agreements in 2012, a
very high level of liberalization of Serbian foreign trade has been reached, and this is reflected in the fact that
around 86.5% of total exchange between the Republic of Serbia and the world is performed with the coun-
tries with whom Serbia has agreements on free trade signed, while 94.7% of Serbian export goes to the mar-
kets of these countries, most of which goes to the EU (57%) and CEFTA (30%).
In 2012 the custom rates have been reduced in several phases in line with the dynamics determined in
each of previously ratified agreements, while transitional periods will be over, i.e. the zone of free trade with
CEFTA will be formed in 201312, with the EU and FTA in 2014 and with Turkey in 2015.
European Union is the most important foreign trade partner of Serbia (for more details see 2.2.3 Degree
and Pace of Trade Integration with the EU), while CEFTA is the second most important partner. Serbian ex-
change with the CEFTA members amounts to 16% of total trade exchange based on the annual average, i.e. 28%
of the total export and 8% of the total import. The Republic of Serbia has been recording constant surplus in the
exchange with the CEFTA, which in first 10 month of 2012 amounted to 1.2 billion. In comparison to the same
period in 2011, in the first 10 months of 2012, a decline in export to CEFTA members by 0.3% and in import by
6.3% has been recorded.
In the previous period additional liberalization within CEFTA agreement has been achieved. Namely,
Serbia applies additional protocol on subsequent liberalization of trade in agricultural food products, with
Croatia and Albania since 15 December 2011 and with Moldova since 13 January 2012. In accordance with
this Protocol the trade with Albania and Moldova has been fully liberalized, while the trade with Croatia was
additionally liberalized by mutual, reciprocal application of duty-free access for 67% of tariff lines, while
preferential quotas with zero-duty within the quota and preferential customs within the customs quota for
vulnerable fundamental agricultural food products have been set for 512 tariff lines: meat, milk, dairy and
meat products, apples, wheat, corn, sugar, tobacco, cigarettes etc.
By forming Customs Union between the Russian Federation, Republic of Belorussia, Republic of Ka-
zakhstan, the need for adjustment of the free trade of the Republic of Serbia with the Customs Union mem-
ber states has become obvious. Approximation of the Free trade agreement between the Russian Federation
and the Republic of Serbia in relation to all three member states of the Customs Union has been realized by
the Protocol on exceptions from the free trade regimes and rules on the origin of goods along with the Free
Trade Agreement from 2000 that was signed on the 22nd of July 2011 in Belgrade, and with Belarus by sign-
ing of the Protocol on amendments to the Free Trade Agreement from 2009 (from the 15th of June 2011).
The list of products excepted from the free trade regime in terms of their export to the territory of Rus-
sian Federation includes: meat and edible poultry residues, cheese and urdu, white sugar, sparkling wine,
undenatured ethyl alcohol, cigarettes, protected pneumatic tires, cotton yarn, cotton fabrics, special fabrics,
compressors for cooling devices, tractors, passenger cars and used motor vehicles for transport of goods and
passengers.
11
The following agreements have been signed until now with: The EU, Russian Federation, CEFTA, FTA, Turkey,
Belorussia and Kazakhstan.
12
By Croatian exiting from CEFTA, full trade liberalization with other CEFTA members will be established.

97
The list of products excepted from the free trade regime when it comes to products imported to the ter-
ritory of the Republic of Serbia include: protected and used pneumatic tires, faucets, valves and similar de-
vices, tractors, passenger cars and used motor vehicles for transport of goods and passengers (Russian
Federation), white sugar, undenatured ethyl alcohol, cigarettes, protected and used pneumatic tires, agricul-
tural and forest tractors, used motor vehicles (Republic of Belorussia), cheese, white sugar, undenatured
ethyl alcohol, cigarettes, protected and used pneumatic tires, tractors, used motor vehicles, passenger vehi-
cles. (Republic of Kazakhstan).
The negotiations/consultations on the free trade agreement with Ukraine that were initiated in 2011
have been continued in 2012. A significant liberalization of trade in goods and services has been offered to
the Ukrainian side within the bilateral Free trade agreement, provided it renounces some of the requests it put
in front of the Republic of Serbia in the negotiations of Serbian accession to the WTO.
StarAdditionally, in 2012, negotiations on further liberalization of trade in agricultural products with the
Republic of Turkey, either by increase of tariff quotas in some cases or using other forms of liberalization
have been initiated and therefore negotiations on adjustment of the Free Trade Agreement are expected in
2013.
For more information and priorities in 2013, as well as on measures planned for the period 2014-
2016, see Chapter 30.

2.1.4. Ability of financial sector to direct savings towards productive


investments
Banking
Starting from 2001, the Republic of Serbia has started implementing reform in financial sector, initi-
ated in the part of banking sector as the most important and the most dominant. Reform has been directed
towards development of stable and safe banking market, as well as harmonization of regulations with the
relevant international standards. In the period from 2001 to 2012, the number of banks was more than
halved (from 86 at the beginning of the reform to 32 in 2012), while baking sector was privatized and trans-
formed both by green-field investments and by taking over of existing private banks i.e. banks with mostly
social or state capital. Therefore, around three quarters of balance sheet assets of the sector is in majority
ownership of the well ranked foreign strategic investors.
In billions of EURO
November
2008. 2009. 2010. 2011. 2012
Number of Banks 34 34 33 33 32
Number of employees 32.342 31.182 29.887 29.228 28.590
total assets 20.055,7 22.530,4 24.014,9 25.3254,0 25.527,8
Banks in foreign ownership 15.109,1 16.736,8 17.656,0 18.776,6 19.073,1
Banks owned by the Republic of Serbia 3.209,1 3.940,0 4.301,8 4.512,1 4.689,3
Banks in domestic private ownership 1.737,5 1.853,6 2.057,2 2.035,4 1.765,4
Total assets/GDP 61,4 77,8 85,7 81,3 89,7
Capital 4.740,5 4.666,7 4.720,1 5.216,7 5.359,5
Banks in foreign ownership 3.493,2 3.412,7 3.348,7 3.928,2 3.914,6
Banks owned by the Republic of Serbia 672,9 708,7 822,9 713,0 888,2
Banks in domestic private ownership 574,4 545,3 548,6 575,4 556,8
Capital/GDP 14,5 16,1 16,9 16,8 18,8
Total deposits 11.565,4 13.570,3 14.263,4 14.590,5 14.817,5
Savings 4.780,6 6.013,7 7.105,8 7.611,2 8.181,6
Total deposits/GDP 35,4 46,9 50,9 46,9 52,1
Total loans 11.597,8 13.236,5 14.528,7 17.556,4 16.919,4
Enterprises 6.694,6 7.267,5 8.096,1 8.197,1 8.433,4
Population 3.923,6 3.928,2 4.590,2 4.938,9 4.969,0
Total loans/GDP 40,5 50,2 56,2 56,4 59,5
Capital adequacy 21,9 21,4 19,9 19,1 16,4*
* the last available data are from September 2012

98
Banking sector in the Republic of Serbia is going through debt crisis in the Euro zone well protected,
i.e. adequately capitalized and liquid. Banks, as independent legal entities, are primarily dependant on do-
mestic financing sources, primarily foreign currency savings of the population, what along with the decrease
of foreign debt, makes them less exposed to the influence of the negative movements from the region.
Although banks in Serbia were not directly influenced, spreading of the global economic crisis primarily re-
sulted in the psychologically-influenced withdrawal of foreign currency savings from banks. The trend of
savings withdrawal was reversed in December 2008 and until the end of 2009 when it reached 6.0 billion.
The private individuals deposits keep increasing until now. According to the last available data, the private
individuals deposits amount to 8.2 billion.
Stability of the baking sector during the crisis was increased by, both support of the parent banks and
timely measures of the National Bank of Serbia directed towards providing additional liquidity by reduction
requirenments for allocation of reserve requrenment, as well as exsisting solid liquidity reservs of banks,
before all in the form of securities issues by the Central Bank.
In order to implement the European Bank Coordination (Vienna) Initiative, whereby parent banks
i.e. foreign majority stakeholders of the banks who are active in Serbia obliged to maintain exposure of their
groups in Serbian subsidiaries at the end 2008 level as well as to maintain capital adequacy ratio and liquid-
ity at the prescribed level, National Bank of Serbia has adopted regulations supporting financial stability of
the country. Short-term loans for support of dinar liquidity, foreign currency swap transactions with the Na-
tional Bank of Serbia in order to support foreign currency liquidity as well as benefits in classification of
claims were made available to the banks included in this programme. The programme established by Vienna
Initiative has expired on 1 January 2011.
On 12 and 13 March 2012 a meeting (so called Vienna Initiative 2.0) was organized by the European
Commission in Brussels which was attended by the representatives of regulator, supervisor, central banks
and fiscal authorities of the home and host countries, as well as bank representatives and representatives of
the most prominent international financial institutions. The conclusion was reached on this occasion that all
participants are interested in maintaining stability and providing sustainable credit activity in the region. In
accordance with this, 8 fundamental principles were declared at the meeting. Their goal is to minimize the
risk from disorderly deleveraging of EU banking groups activity in the region and improve coordination of
the process of regulating and supervising banking sectors, as well as preventing negative spill-overs between
the EU countries and the countries of the region. Activities related to Vienna Initiative 2.0 have been con-
tinued in the second half of 2012. Despite the fact that the new Vienna Initiative contains no obligatory ele-
ments, its effects should contribute to preservation of banking sectors stability in the region, including
Serbia.
Banking sector is adequately capitalized growth rate of own financing resources was sufficient to
enable share of own resources in total liabilities at 21%. Capital adequacy ratio was 19.1% on 31 December
2011, and 16.4% on 30 September 2012. Lower value of indicators in 2012 is a result of, primarily, increase
in the amount of reserves for assessed losses (that are deducted during the calculation of regulatory capital)
due to deterioration of quality of the banking sector credit portfolio. However, this value remains above
regulatory minimum in Serbia (12%) and significantly above Basel minimum (8%).
Baking sector remained liquid also in 2012. Average monthly banking sector liquidity indicator re-
mained above 2 in 2012 (except in October when, due to the week of savings and resetting the due date for
the following month, amounted to 1.52, but it reached 1.82 by the end of November) which shows that liquid
assets (liquid claims of the first priority and other claims due in the following month) would be two times
bigger than the sum of claims with no maturity and claims that will mature in the following month. At the
end of November 2012 liquid assets were 34.9% of total balance sheet assets and 60% of short-term claims.
Net profit before taxation for first 11 months of 2012 was RSD22.3 billion (around 198 million). It is
a considerable decrease (27.1%) in comparison to the same period 2011, caused primarily by high direct
writing-off of nonperforming claims (increase by RSD6.6 billion, i.e. around 59.0 million), which also in-
fluence the decrease in the ROA (0.9% in comparison with 1.3% in the first 11 months of 2011) and ROE
(4.2% in comparison with 6.4% in the first 11 months of 2011). Low profitability was primarily influenced
by one bank with in majority state ownership that recorded high level of writing-off (without the date for this
bank, ROA would be 1.2% while ROE would be 5.8%).
Credit risk remains the dominant risk in operations of banks. Simultaneously, the quality of the banks
credit portfolio deteriorated, which is an expected trend in an environment of slowing down of the economic
activities and salaries, and especially in an environment of depreciation of the dinar due to credit risk in-

99
duced by foreign currency. Nonperforming loans (net, 90 days late) amounted to RSD372.9 billion
(around 3.3 billion) with net NPL indicator of 18.9%, which represents the most important difficulty in pre-
serving banking sector stability. However, high reserves and adequate capitalization of banks have so far
managed to provide sufficient coverage for their problematic disbursements. Loan loss reserves still fully
cover the net value of NPL. At the end of November this coverage was 121.3% while the value adjustment of
total loans (according to IFRS) was 51.2% of the net value of NPLs.
Within the scope of bank supervision development, supervision process is being continuously harmo-
nized with international standards and recommendations of good practices of relevant international profes-
sional organizations. A comprehensive and transparent policy for licensing and seizure of licences of
participants at the financial market has been established. Supervision performed by the National Bank of
Serbia over the banking sector is directed towards assessing of risks and monitoring of trends in the devel-
opment of supervision practices.
Standards promoted by the Basel Committee on Banking Supervision are being implemented both in
terms of supervision process and in terms of regulative competency of the National Bank of Serbia. Full ap-
plication of a new set of the National Bank of Serbias by-laws adopted based on the Law on Banks that en-
tered into force on 31 December 2011, which implements Basel II standards in Serbia, has been initiated.
In the process of supervision the National Bank of Serbia cooperates, beside the bodies of the Repub-
lic of Serbia, with the supervisory bodies of other states, while the method of cooperation is determined by
the agreement on cooperation between the National Bank of Serbia and the relevant supervisory body. Be-
side bilateral cooperation, the National Bank of Serbia participates in the work of so called College of Su-
pervisors, organized by the competent regulatory body in charge of banking group supervision on a
consolidated basis.
Insurance
By adopting the Law on Insurance in 2004, implementation of the reform of insurance sector as well
as a part of financial sector has been initiated. The National Bank of Serbia had been trusted with insurance
supervision.
Reform of the insurance sector has, besides setting the new regulatory framework, included activities
towards: Improving of the system for internal supervisions and the function of risk management, develop-
ment and implementation of supervision based on risk, education, actuars licensing, direct supervision of
monitored entities, development and implementation of the model for calculation of the reserves for dam-
ages, financial education of population project, disaster insurance project and many other activities. Coopera-
tion with international and domestic institutions is an important factor, which contributes to efficiency of
overall financial system supervision and thus to preserving of national financial stability. In accordance with
that, the National Bank of Serbia has signed several agreements on cooperation in the field of insurance su-
pervision. NBS is a member of International Association of Insurance Supervisors (IAIS).
As a result of mentioned activities, eight years after the initiation of the reform of insurance sector, and
beside the effects of indirect exposure of Serbia to the effects of global financial crisis, its stability is pro-
vided, and thus the goal of the National Bank of Serbia, which includes creating and sustaining safe and sta-
ble insurance sector and gaining public trust in it in order to protect interests of the insured and third parties,
has been achieved
Namely, first effects of the crisis reflected at deceleration of the growth of insurance companies capi-
tal, and deceleration of nominal growth of total insurance premium in 2009, 2010 and 2011, but with con-
tinuation of nominal and real growth of life insurance premiums, as well as technical reserves and balance
sums. In the above mentioned period, in the conditions of the world economic crisis, the insurance sector
had a positive balance, with the satisfying level of solvency.
Presently, there are 28 insurance companies at the market, of which 24 companies deal exclusively
with insurance, while 4 of them are in reinsurance business. Among the insurance companies, there are 7
companies that deal with life insurance only, 11 companies deal only with non-life insurance while 6 of them
deal with both life and non-life insurance. In terms of capital ownership, out of 28 insurance companies, 21
are in majority foreign ownership while 7 are in domestic. 13 greenfield license issues since 2005 by the
NBS testifies in favour of regulation of the insurance market. Beside insurance companies, the sales network
also includes: 19 banks were issued certificates for performing activities of representation, 82 legal subjects

100
and 107 natural persons entrepreneurs, while representation i.e. mediation certificate, was issued to 13851
natural subjects13.
Comparative indicators from the third quarter of 2012 and the same period 2011 lead to conclusion
that the previous insurance market development trend has not changed.
The number of employees is growing at 0.5% and is now 11388 employees in comparison to previous
11330. Insurance companies in foreign ownership have a majority share in the number of employees with
64.7%.
Total premium in the period from 1 January until 30 September 2012 amounted to RSD47.5 billion
(413 million), which represents growth by 6.7% in comparison to the same period of the previous year. 14
The share of non-life insurances in the premium structure was 82.4%, while the share of life insurances was
17.6%. The growth of life insurance share from 15.8% in the same period of the previous year is the result of
the growth of these insurance by 18,9%.
Premium for non-life insurances in the observed period recorded growth by 4.4% in comparison to the
same period 2011. Property insurance premium has increased by 7.5%, motor vehicle liability premium
2.5%, while, due to expected effects of the economic crises reflected in form of decrease of the non-
mandatory insurance premium, full coverage motor vehicle insurance premium decreased again.
The future development of the insurance sector is expected in the field of life insurance, considering
favourable conditions for its development in Serbia. Among these are: 7.3 million citizens, around 1.7 mil-
lion employees, growth of private individuals deposits (deposit potential); preserving trust of the population
in the work of insurance companies etc.
It is necessary to emphasize that the pace of development of life insurance largely depends on, on one
side development of the real environment, i.e. external factors (GDP, purchasing power, development of the
capital market, regulation of life insurance taxation that would stimulate development of this type of insur-
ance), and on the other side, on the willingness of the insurance companies themselves to improve their ser-
vices in the market segments with development potentials, with education of potential beneficiaries and
improvement of the risk management procedures.
Voluntary pension funds
Voluntary pension funds in the Republic of Serbia are the result of the reform of pension system, that
was initiated by adoption of the Law on voluntary pension funds and pension plans (Official Gazette of RS,
no 85/2005 and 31/2011). The first pension fund began work in November of 2006.
In the previous period, besides establishment of new pension funds, some management companies ex-
ited the market while funds were merged: therefore presently at the voluntary pension funds market there are
five management companies and nine voluntary pension funds (one management company manages three
funds, while two companies manage two funds each). One of the management companies is owned by the
state, while other four are fully in private foreign ownership.
The number of users of voluntary pension funds is constantly growing and in November 2012 it
reached 179.577 and 239.962 contracts signed (one user can be a member of several funds). Also, average
amount of paid contribution shows growth tendency and this is primarily influenced by increase of the
amount of non-taxable income that is annually aligned with the increase of retail prices and whose goal is to
stimulate this type of savings. The average amount of contributions paid in 2012 was 3.930 dinars. Net
property of pension funds keep growing and in the previous year it increased by 25% approximately, thereby
amounting to RSD15.5 million by the end of November 2012. GDP share of funds net property at the end of
the third quarter of 2012 was 0.46%. Increase of net property is mostly generated by net contributions paid
by the funds members. During 2012, average share of voluntary pension funds in total Belgrade stock market
exchange was 2.21%. FONDEX (pension funds index that indicates weighted average contribution of all
funds) has since the funds started working increased by 8.2%, while in the last year it increased by 11%.
Some of the main reasons for insufficient development of the voluntary pension funds industry can be
recognized in the state of national economy, poor standard of living of the population, and insufficiently de-
veloped fiscal market with limited possibilities for diversification of the fund's property investment. Com-
paring with the beginning of pension funds work, conditions at national financial markets have, in that sense,
improved, taking into consideration existence of new financial instruments - corporate bonds, long-term cou-

13
State 20 of November 2012
14
According to the medium term exchange rate of the National Bank of Serbia 30 September 2012.

101
pon bonds of the Republic of Serbia, treasury bills with various due dates, as well as shares of several state-
owned companies (after privatization).
Further development of the system of voluntary pension funds has a great potential, especially consid-
ering significant pressure on the public budget caused by aging of the population and the fact that presently
only 2.4% of the population has savings in the pension funds, which is slightly less than 10% of employees.
Effects of the economic crises influenced the development of the pension funds sector, but with the recovery
of the country and improvement of the standard of living, the number of users and the value of contributions
paid are expected to increase as well as the role of the pension funds as institutional investors at financial
market. Clear signals that there is a need for timely savings for the old age that were sent by the carriers of
the economic policy should influence faster development of voluntary pension funds, which will on the other
hand have positive influence on the national savings, development of financial market and national economy.
Capital Market
After initial growth of financial market in Serbia during 2006 and 2007, starting from 2008, as a result
of global financial crisis, domestic capital market has been recording drastic fall. According to the data from
Belgrade stock exchange, total circulation at the stock exchange during 2007 was RSD165 billion (2 bil-
lion), while, accompanied with constant decrease, total circulation in 2011 was RSD28.6 billion (280 mil-
lion). Circulation made in 2012 was a bit less than RSD25 billion (220 million). This shows that the trend
of decrease continues and that the circulation has reduced as much as 9 times in comparison to 2007. This is
confirmed by the fact that in 2007 the GDP share of total market capitalization of companies whose shares
were exchanged at the Belgrade stock exchange amounted to 45%, while the same share in 2012 was only
24% of GDP.
Crisis at the domestic capital market influenced drastic fall of the value of the property managed by
open investment funds. Namely, at the end of 2007, open investment funds were managing total of RSD 2.6
billion, while at the end of the second quarter of 2012 that amount was smaller by about one billion.
According to the data from the Securities Commission, total number of registered broker-dealer com-
panies is reduced from 84 in 2008 to 35 at the end of 2012. On the other hand, the number of investment
funds management companies is reduced from 14 (2008) to 6 (2012).
Main characteristic of the Serbian capital market remains insufficient market capitalization in com-
parison to GDP. Simultaneously, structure of market material has been reduced so that owners securities
participate with 2% in the total circulation value while debt securities participate with around 98%. Besides
that, the offer of quality financial instruments remains modest, primarily considering insufficient offer of
municipal and corporate bonds as well as government debt securities.
Based on everything mentioned, a conclusion can be made that domestic capital market is still shallow
and insufficiently developed with very low liquidity. However, recovery of domestic capital market will
primarily be conditioned by general economic ambience and overall economic growth of the country. On the
other hand, during 2013, work will be intensified on further improvement of legislative framework regulat-
ing capital market and its comprehensive alignment with the EU regulations.
With a view to develop capital market in Serbia and improve quality of securities exchanged, it is nec-
essary for large infrastructure companies to enter stock market exchange (Telekom Srbija, EPS etc.). In fa-
vour of this is the fact that after NIS entered the stock exchange the market experienced certain revival
considering previous level of liquidity and circulation at the Belgrade stock exchange. Besides being one of
the most exchanged stocks at the market with growth over 20%, NIS set high standards of corporate culture,
that provide transparency and thus create conditions for gaining trust of investors in their work. Market en-
tering of these companies would increase the offer of quality market material for investments of foreign in-
vestors, while in terms of companies themselves, it would enable market valuation of their capital and open
new channel for providing additional assets.
Special importance for the development of domestic capital market has further strengthening and im-
provement of the supervisory function at the financial market. In that sense, the Securities Commission, su-
pervisory and regulatory body in this field, will as a full member of the International Association of
Securities Supervisory Authorities strengthen the national capital market through regional and international
cooperation with a view to improve quality of national regulations and increase supervisory capacity of na-
tional regulatory authority. Besides that, the level of professional knowledge and skills will be improved
along with the trust of investors and the public in the national capital market.
For more information view Chapter 9. Financial Services

102
2.1.5. Ownership and restructuring of companies
Ongoing activities in 2012 are preformed in accordance to the law and bylaws regulating privatization,
related to the sale of the capital and property through public tenders, auctions and by following restructuring
procedures.
A detailed analysis of the existing portfolio is ongoing, with consideration of potentials to improve
privatization by strengthening existing privatization instruments, amending regulatory framework with an
attempt to carry out another round of privatization, while the initiation of bankruptcy procedure would be the
final result for all companies that were not privatized.
By realization of activities in 2012, revenue generated amounts to 6.7 million with investment obliga-
tions worth 7 million. Hereafter, related to the ownership structure of the company, we give a list of com-
panies from portfolio of the Privatization agency:

PUBLIC COMPANIES 249


53 in the process of restructuring
5 tenders
130 auctions
61 in the preparation phase

GOVERNMENT COMPANIES - 339


122 in the process of restructuring
14 tenders
85 auctions
21 in the preparation phase
97 without method (temporary capital representa-
tive)
This list does not include the following public companies, government companies: Telekom ad Beo-
grad, Galenika ad Beograd, companies unbundled from EPS and JAT;
Priorities overview
Taking into consideration provisions of the Law on Privatization, the most important activities for
2013 could include:
1.Completion of the privatization of socially-owned and state-owned capital in accordance with the Law on
Privatization by means of calls for competition, auction sales, sales of assets and liquidation/bankruptcy;
2.Sale of stocks and shares from the Equity Fund (capital market);
4.Privatization of socially-owned capital in companies organized in line with the Decree on Protection of
Assets of Parts of the Companies Established in the Territories of the Former Republics of SFRY and
5.Involvement in the drafting of the program for Reconstructing the Public Utility Companies in the Repub-
lic of Serbia
- In a total, in the period since the adoption of the Law on Privatization (July 2001) until 25 Decem-
ber 2012, the following were privatized/sold:
- - by means of auctions, 1,532 companies with a wholesale price of EUR 864 mil. and investments
of EUR 193 mil.
- - by means of tenders, 83 companies with a wholesale price of EUR 1.02 billion and investments of
EUR 877 mil.
- on the capital market: 751 share packages with a wholesale price of 639 mil.
In addition, the activities regarding the adoption of theProgram for Reconstructing the Public Utility
Companies in the Republic of Serbia (the Program) are underway. The program deals with key issues in pub-
lic utilities companies activities, for example with ownership relations and organization and activities of
these companies, disregarding their field of work. In this regard, the public discussion on the Draft Program
was held in the period from 15 July to 15 October 2011 and from 1 September to 13 October 2011 it was
guided through the round tables in Serbian cities. According to the point 9 of the Program for Public Discus-
sion (conclusion of the Government 05 no: 023-25547/2011-1 from 12 July 2011) MEPP compiled and for-
warded the Report on the Conducted Public Discussion to the Committee for Economy and Finance of the

103
Republic of Serbia. Further on, the Governments adoption of the Programme is planned in I quarter of 2013,
after which will start work on preparing Programe measures and activities.. It is planned that the Program
which should lead to the efficient and effective operation of these companies will define different models for
example PPP concept (public-private partnership i.e. concept entailing interaction between private and public
sector), concession and similar in accordance to the positive experiences from European practice.
Restitution in the process of restructuring of companies
Framework for Restitution Agency activities with regard to companies regardless of the type of their
organization are set by the Law on Property Restitution and Compensation (Official Gazette of RS, no
72/2011), especially Article 18 paragraph 2 of the mentioned law that sets forth non-restitution of national-
ized companies.
Therefore, according to the provisions of the Law, the property that was incorporated in nationalized
companies will not be restituted. This provision is also related to the companies that are presently in the
process of restructuring, provided that the assets in question have been previously nationalized as the assets
of the confiscated companies.
Possible exception from the cited Article of the Law would be restitution of real estates which were
determined to be in property of natural persons, and which have after the process of nationalization become a
part of public. i.e. government companies.
According to the Article 9, Paragraph I of the Law, the Republic of Serbia, autonomous province, lo-
cal self-government unit, public company, enterprise or another legal person founded by the Republic of
Serbia, autonomous province, local government unit, enterprise with majority public capital or cooperation,
including both enterprises and cooperation in the process of bankruptcy and liquidation which is on the day
of this Law's entry into force owner, holder of the rights of usage or disposition of the nationalized property
in relation to his rights, have the obligation of restitution of nationalized assets in natural form.
According to the Article 10, acquirer of the property who, after property support, in accordance with
the law, acquired the property rights, remains the owner and the holder of the assets, and the rights he ac-
quired cannot be violated.
Article 15 stipulates what property can be the subject of restitution: "By this law unmovable and mov-
able assets in the public ownership of the Republic of Serbia are restituted, autonomous province i.e. local
self-government units, in public government ownership and cooperation ownership, except for the assets
owned by cooperative society members in state and cooperative society's ownership that the owner acquired
with compensation".
The subject of restitution is nationalized real estates: Building lands, agricultural land, forests and for-
est land, housing units and commercial buildings, apartments and business premises and other units that exist
at the date of entry into force of this law.
Subject of the restitution are nationalized movable assets registred in the public register, as well as
other movable assets which according to the regulations on cultural property, represent cultural goods and
cultural goods of great and exceptional importance, which exist at the date of entry into force of this law.
Finally, Article 18 of the Law, Paragraph 1, points 4,5,9,10 stipulate the following exceptions from the
restitution in natural form: The right to ownership of real property shall not be returned if the properties
have the following purpose and/or status on the date of entry into force of Law:
4) real properties which make inseparable and integral part of networks, structures, devices and other
facilities used for performing core activities of public enterprises, companies established by public
property holders, as well as their subsidiaries, in the fields of energy, telecommunications, transporta-
tion, water management and activities of public utilities;
5) real properties whose restitution would considerably violate economic i.e. technological sustainability
and operability in performance of core activities of the entity undergoing privatization which has not been
privatized, as well as an entity sold in bankruptcy proceedings as a legal entity, which the real properties
belong to.
9) real properties sold and/or acquired in the privatization process as the property or capital of the en-
tity undergoing privatization, in accordance with the law regulating the privatization process;
10) real properties sold in bankruptcy proceedings of state or socially majority-owned enterprises, as
well as real properties representing state or socially majority-owned property of bankruptcy debtors
which have been sold in bankruptcy proceedings as legal entities;

104
2.1.6. Absence of major obstacles for entering and exiting the market
By adoption of adequate legal regulations, conditions for uninterrupted economic activities are met:
Company Law (Official Gazette of RS No. 36/11, 99/11) (detailed view in Chapter 6, Company Law ) and
the Law on Procedure of Registration with the Serbian Business Registers Agency (Official Gazette of RS,
no 99/11) whose application started on 1 February 2012, regulate the procedure for establishment of compa-
nies (companies and entrepreneurs) that takes place within the Business Register Agency, as a central institu-
tion that keeps records on business registers which represent centralized data base on economic operators.
More information in Chapter 3. Right of establishment and freedom to provide services)
The number of companies in 2012, by month, according to the data entered into the Companies Register
ESTABLISHMENTS IN 2012
MONTH COMPANIES ENTREPRENEURS
January 619 2.073
February 523 1.484
March 873 2.807
April 778 2.935
May 811 3.118
June 763 2.568
July 690 2.452
August 747 2.345
September 630 2.352
October 854 2.753
November 679 2.869
December 545 2.055
TOTAL 8.512 29.811

COMPANIES
ESTABLISHMENTS IN 2012 TOP 10 ECONOMIC ACTIVITIES
Code
of eco-
Number Main economic activity
nomic ac-
tivity
1.010 4690 Unspecialized wholesale trade
388 7022 Business and other management consulting activities
286 4120 Construction of residential and non-residential buildings
274 5610 Restaurants and mobile food service activities
190 4941 Charage of goods by road
162 6201 Computer programming
150 3511 Production of electricity
145 7112 Engineering activities and related technical consultancy
126 4711 Retail sale in non-specialized stores with food, beverage and tobacco predominating

6920 Accounting, bookkeeping and auditing activities; tax consultancy

ENTREPRENEURS
ESTABLISHMENTS IN 2012 TOP 10 ECONOMIC ACTIVITIES
Code Name of
Number
of Activity activity
2.031 5610 Restaurants and mobile food service activities
1.968 5630 Preparation and serving beverages activities
1.333 4711 Retail sale in non-specialized stores with food, beverage and tobacco predominating

105
1.225 4932 Taxi operation
1.164 9602 Hairdressing and other beauty treatment
965 4941 Carage of goods by road
886 7022 Business and other management consulting activities
753 4520 Maintenance and repair of motor vehicles
658 4771 Retail sale of clothing in specialized stores
656 4719 Other retail sail in non-specialized stores
According to the registered data, the following number of economic operators have socially-owned
and state-owned capital:
COMPANIES WITH SOCIALLY-OWNED CAPITAL
Number Legal form Status
38 Joint stock company Active company
18 Other Active company
219 socially-owned company Active company
70 Limited liability company Active company
18 Public undertaking Active company
59 Open joint stock company Active company
11 Cooperative society Active company
433 TOTAL

COMPANIES WITH STATE-OWNED CAPITAL


Number Status
869 Active company

All the above data are taken from the database of the Company Register of the Serbian Business Reg-
isters Agency concluding with 26 December 2012.
Absence of obstacles for starting economic activities has been dealt with in Chapter 3 in more details -
Right of establishment and freedom to provide services and Chapter 6 Company law.
Exiting the market
Beside regulations related to establishment of companies, laws regulating their termination have been
amended. Law on Bankruptcy (Official Gazette of RS, no 104/09; 99/11 - state law and 71/12 decision of
the Constitutional Court ) governs conditions and the manner of initiating bankruptcy proceedings for legal
persons. Bankruptcy proceedings include liquidation or reorganization.
In term of market access, the Law on bankruptcy entered into force in January 2010 (amended 2012), but
many of the cases have not been resolved. Because of this, it is necessary, through professional supervision of
the work of insolvency practitioner, to identify causes for the high number of unresolved cases (present causes
are mainly long court proceedings and frequent postponements of scheduled hearings). Similarly, it is neces-
sary, along with Commercial appellant court, to encourage termination of court proceedings based on the law
from 2005 (Law on Forced Settlement, Bankruptcy and Liquidation).
The new regulations set by Law on Bankruptcy, show the willingness of institutions of the Republic of
Serbia to create an environment that would protect interests of creditors. The law enables legal persons to
react timely and appropriately in case of a business problem, both in their own interest and in their clients
interest and interest of the society as a whole. This is to say that another important novelty has been intro-
duced - pre-prepared reorganization plan (PPRP) as an institution that is in use in Serbia for the first time.
Previous results in application of regulations led to positive developments in terms of duration of
bankruptcy proceedings. According to the data from the Bankruptcy Supervision Agency, total average du-
ration of bankruptcy proceedings for 3867 cases is: 1 year, 5 months and 9 days (active, stopped and con-
cluded) while total average duration of proceedings for cases initiated from 2 February 2005 (total of 4430
cases), according to the Law on bankruptcy proceedings and the Law on Bankruptcy is: 1 year, 5 months and
5 days.
Cases initiated based on Law on Bankruptcy (total of 3311 cases, from 23rd of January 2010), average
duration is 1 year, 0 months and 27 days.

106
The new Law on Bankruptcy enabled efficient supervision of bankruptcy administrators work by intro-
ducing professional supervision of their work, possibility of taking disciplinary measures in case of unethical
and illegal work of an bankruptcy administrators, as well as introducing Disciplinary Council of the Agency as
the professional supervisory body. Final decisions on 118 cases have been made, while nine cases were solved
through procedural law in the procedure before the Disciplinary Council of the Agency that spanned from Sep-
tember 2010 to 27 November 2012. 65 serious and 46 less serious infringements of duty of insolvency practi-
tioners have been registered for which proper disciplinary measures prescribed by the law have been enforced.
Bankruptcy Supervision Agency is established by the Law on Bankruptcy Supervision Agency (Offi-
cial Gazette, no 84-04 and 104/09) and it started working on 24 February 2005.
Law on Bankruptcy (Official Gazette, no 104/09, 99/11 - state law and 71/12 decision of the Constitu-
tional Court), was adopted on the 23 December 2009 and entered into force on the 23f January 2010.
The Law on Bankruptcy as well as the Law on Bankruptcy Supervision Agency and its amendments
(Official Gazette of RS, no 104/09) describes the role of the Agency, its rights and obligations, as well as
competences from its scope of work as a regulatory body, especially in terms of professional supervision,
redefine conditions for licensing , define conditions for renewal and revoking of the licence, set the rules for
keeping the directory of names of bankruptcy administrators, introduce professional supervision of the bank-
ruptcy administrators work, prescribe the method for random election of bankruptcy administrators, legally
recognize bankruptcy administrators as officials, prescribes their mandatory insurance, redefines conditions
for their dismissal, and introduce pre-prepared reorganization plan.
According to the data from the Business Registers Agency and based on the applications for registra-
tion, 5708 companies are in the process of liquidation while 2661 companies are in the bankruptcy proceed-
ings.
REMOVAL FROM THE REGISTER IN 2012
Month COMPANIES ENTREPRENEURS
January 685 3.912
February 422 2.065
March 888 3.127
April 680 2.474
May 782 2.553
June 1.345 2.406
July 1.338 2.834
August 181 2.492
September 172 2.263
October 228 2.930
November 244 2.591
December 276 2.136
TOTAL 7.241 31.783

COMPANIES IN THE BANKRUPTCY PROCEEDINGS


(state in the Business Register on the 26th of December 2012)
Cumber of companies Status code
2.661 5

COMPANIES IN THE PROCESS OF LIQUIDATION


(state in the Business Register on the 26th of December 2012)
Total Status code
5.708 4

Regulatory reform
Overview
Office for Regulatory Reform and Regulatory Impact Assessment provides professional services for
the Government related to implementation of regulatory reform and impact assessment of regulations pro-
posed by the ministries and special organizations, and which are regulated by the Regulation on the Office
for Regulatory Reform and Regulatory Impact Assessment (Official Gazette of RS, no 89/10).

107
Implementation of comprehensive regulatory reform
Office for Regulatory Reform and Regulatory Impact Assessment (hereinafter Office) has taken over
the services of the Unit for Implementation of Comprehensive Regulatory Reform (hereinafter: the Unit for
implementation of CRR) whose competence was short-term comprehensive abolishment or amendment of
the obsolete and economically detrimental regulations. On the date 27 December 2012, the status of recom-
mendations was as follows:
Table: Status of Recommendations for Comprehensive Regulatory Reform on 28 December 2012

Recommendations status Number Assessed savings in millions


Implemented 212 128,5
In the process of implementation 27 18.4
Unimplemented 65 36,2
Abandoned recommendations 36
Total 340 183,1
Source: Office for Regulatory Reform and Regulatory Impact Analysis
Out of 340 recommendations for amendment of the regulations that unnecessarily complicated busi-
ness, and which were defined and forwarded to the government for adoption in 2009, concluding with 28
December 2012, 212 recommendations have been implemented, while 27 are in the process of implementa-
tion. It is assessed that the realization of all recommendations could help Serbia save total of 183.1 million
on annual basis.
Supervision of implementation of regulatory reform assessment The Office has also taken over the
services of the Secretariat of the Council for Regulatory Reform of the Economic System of the Republic of
Serbia.
The draft text of the new Regulatory reform strategy in the Republic of Serbia for the period 2013-
2015 (hereinafter: Strategy), as well as Action plan for implementation of the Strategy is prepared. Initiative
for amendment of the governments rules of procedure has been prepared and delivered to the competent
bodies. By adoption of the proposed amendments to the governments rules of procedure, the key issues for
more comprehensive supervision of legislative process and regulatory reform by the Office would be regu-
lated.
The office prepared the instruction for implementation of the Small and medium-sized enterprises im-
pact assessment test (hereinafter: the SME test) and published it on its web page.
Overview of 2013 priorities
Priorities of the Office in 2013 are improvement of the quality system of regulatory impact analysis
and further monitoring of the Comprehensive regulatory reform implementation process.
Administrative capacities
The process of improvement of operative capacities of the Office with a view to fill in executive posi-
tions is ongoing in order to perform set priorities and activities promptly and fully.
Measures for Implementation of Priorities in 2013
Measures and activities that will be undertaken with a view to implement cited priorities include:
- adoption of already prepared Regulatory reform Strategy in the Republic of Serbia for the period
2013-2015 (hereinafter: the Strategy) as well as Action plan for implementation of the Strategy;
- Adoption of prepared amendments to the Governments rules of procedure;
- Adoption of the regulations for regulatory impact analysis methodology:
- Preparing of opinions on all draft laws;
- Improvement of capacities for preparation of regulatory impact assessment in regulatory bodies and
the Office itself, through consultations and continuous training;
- Monitoring of the status of unrealized recommendations from the Comprehensive regulatory re-
form and initiating their final and full realization;
- Affirmation of the regulatory impact analysis on the local level;
- Further improvement of the web page of the Office in order to enable better communication and in-
teraction between the Office and all parties interested in the regulatory reform process, improve the

108
communication with the private sector, i.e. SMEs and citizens by providing opportunity to report
administrative barriers that preclude efficient business transactions and/or complicate every day ac-
tivities.
Strategic reference documents which are extremely important for fulfilment of planned Office priori-
ties are related to the field of economy, finance and public administration, and include: Regulatory Reform
Strategy for a period 2008-2011, Industrial Development Strategy and Policy of the Republic of Serbia in the
period 2011-2020, National Strategy on Economic Development in the Republic of Serbia for period 2006-
2012, Competitive and Innovative Small and Medium Enterprises Development Strategy for period 2008-
2013., Strategy on Promotion and Development of Foreign Investments and Republic of Serbia Public Ad-
ministration Reform Strategy.
The budget of the office for 2013 is RSD25 800 000.
Building permits
Overview
Ministry of Construction and Urbanism presently has a great number of applications for issuing build-
ing permits. The main problem that investors encounter is related to procedures that precede the requests for
issuance of building permit, i.e. (non)existence of project documents necessary for issuance of location per-
mit, procedure for registration of property rights at the parcel where the building is planned, establishment of
building parcel, obtaining of proper licences, when it is prescribed by the provision of the specific laws,
amounts of fees for organizing of building land etc. If the documentation submitted is clean, immediate con-
sideration of technical documentation will follow. However, previous practices have shown that only 1% of
submitted documentation satisfies the necessary conditions for initiating the procedure. During the last year,
Ministry has issued 75 decisions on building permits.
The Law on Planning and Construction is fully aligned with the Regulation (EC) No 1059/2003 of the
European Parliament and of the Council of 26 May 2003 on the establishment of a common classification of
territorial units for statistics (NUTS).
Activities planned in 2013 with regard to harmonization of legislation
By the end of the II quarter, Ministry plans adoption of the law amending the existing law or a com-
pletely new Law on Planning and Construction, that will define precise method and procedure for issuance of
building permits, which would lead to shortening of term for obtaining permits, as well as to financial libera-
tion and displacing of certain fees and charges for both building and use permits.
Administrative Capacities
It is expected that the problem that existed in the Ministry so far, which is the problem of insufficient
number of processors and technical equipment, be solved by adoption and application of new systematiza-
tion, that envisions Building Permits Group comprised of a manager and three advisors, which will facilitate
the work process. Adoption of government-level personnel plan for 2013 is expected, which will be followed
by open competitive job announcement for the mentioned job vacancies.
Overview of current and planned foreign development aid
Ministry of Construction and Urbanism remains committed to implementation of activities in the field
of drawing up of detailed regulation plans for informal Roma settlements, whose preparation is within the
local governments competence. These plans are made with a view to meet all legal requirements for infra-
structural equipping and improving of housing conditions of Roma families in these settlements, with the
final goal of their legalization. So far, out of 10 detailed regulation plans, whose drawing up was financed by
the Ministry in eight local governments, 4 urbanism plans were adopted while three more are prepared and
are in the phase of adoption. Existing administrative capacities for realization of planned activities in the
competent housing department do not suffice. Therefore, additional support of the Ministry will be provided
with a view to improve these activities as a part of National programme for Serbia, within IPA component
transition aid and building of institutional capacities for 2012, social development assistance, through im-
plementation of the Measure 4 - Implementation of Strategy for improvement of the status of Roma in the
Republic of Serbia, which will help realize activities planned in the field of improvement of housing condi-
tions for Roma.

109
Agricultural land
In line with the Article 1, Paragraph 3 of the Law on Agricultural Land (Official Gazette of RS no
62/2006 and 41/2009) the owner of agricultural land cannot be foreign natural or foreign legal person. State-
owned agricultural land cannot be sold to neither domestic nor foreign legal or natural person (Article 72 of
the Law on Agricultural Land, Official Gazette of RS, no 62/2006 and 41/2009).
State-owned agricultural land can be leased, while a leaseholder can be any given natural or legal per-
son registered in the agricultural holdings registry in accordance with the Rulebook on manner and condi-
tions of registration and keeping of agricultural holdings register, application forms for registration and
renewal of registration and attachments, documentation submitted with the application, manner of data filing,
as well as conditions for passive status of an agricultural holding (Official Gazette of RS, no 111/2009 and
21/2010).
Furthermore, there is no plan for liberalization of real estate investments, in this case state forests.
Namely, Law on Forest (Official Gazette of RS, no 30/10), in Article 98 and 99 forbids selling or leasing
forests and forest land in state ownership, save for exceptional cases. The forest user can under market condi-
tions and with the government consent, sell or exchange a part of a state-owned forest land whereat rational
management cannot be achieved for a forest or a forest land of the forest owner provided that the forests are
isolated, i.e. enclaves or half-enclaves in a state-owned forest complex.
Foreign Direct Investments in Serbia
According to the data of the National Bank of Serbia (cash inflow) and the Statistical Office of the
Republic of Serbia (in goods), net value of FDI in cash and goods, for the period January-October 2012 was
81 million, mostly due to outflow of Greek (Greek company "OTE sold its share in Telekom Srbija to
the government of the Republic of Serbia) and Danish (withdrawal of capital from Telenor) capital (over
550 million) as well as due to outflow of Dutch capital (around 900 million). Net inflow of FDI in cash
for the same period was 1.6 billion, which represents a decline of around 3.7% in comparison to the same
period last year (2011). Net foreign investments in cash and goods in the first three quarters of 2012
amounted to 1.56 billion. According to the data from the National Bank of Serbia in the first ten months of
2012, in term of net cash investments, leading positions are occupied by the Netherlands, Croatia, Switzer-
land, Italy, Austria, Greece, Cyprus, Germany, Bulgaria and Great Britain while the European Union with all
its members belongs to the group of countries with the highest degree of foreign direct investments in Serbia.
Net inflow from the Netherlands is significantly lower due to large outflow, while in case of Greece only net
outflows are recorded. In terms of inflows by business activity, in the first three quarters of 2012, the largest
inflows are recorded in production sector, wholesale and retail trade - repair of motor vehicles and motorcy-
cles, followed by the civil engineering sector, real estates and financial operations.
According to the data from the National Bank of Serbia, looking at the period from 2000 to 2011 and
the country structure, European Union investors are at the top of the list (15 out of 20 leading investors in
Serbia come from the European Union member states). Austria occupies the top spot on the list of the most
important investors in Serbia followed by the Netherlands, Greece, Norway, Germany, Luxemburg, Italy,
Russia, Slovenia, France and Switzerland.
FDI in cash, billions, 2000-2011

Source: National Bank of Serbia

110
In the previous six years, services sector has been most attractive for foreign investors. According to
the data from the National Bank of Serbia, banking and insurance sector has recorded the highest inflow of
FDI that amounted to 4.7 billion. Production sector has faired second with the 3.4 billion inflow, followed
by wholesale and retail repair of motors and motor vehicles, and real estate.
FDI, by business activity, net billions, 2014-2011

Source: National Bank of Serbia


Since 2000 Serbia has attracted more than 19 billion of foreign direct investments.

2.1.7. Legal system relating to economic issues


Overview
Ministry of Justice and Public Administration
Legal framework has been set by adoption of the package of judicial and anti-corruption laws in 2008.
The new court network operates beginning from the 1 January 2010. Anti-corruption agency officially
started operating on the 1 January 2010, while the Directorate for Management of Seized Assets was estab-
lished as a part of then Ministry of Justice and started operating on 1 March 2009.
After determined shortcomings in the work of the new court network, increase of the backlog of cases
and financial expenditures that followed the competent organs conducted an analysis based on which judici-
ary and procedural laws have been amended and the National Strategy for Reform of the Judiciary and Ac-
tion Plan have been adopted. For more information on the above mentioned amendments, see Subgroup 23:
"Judiciary and fundamental rights.
Especially important aspect represents initial and continuous training in this field conducted by the Ju-
dicial Academy. Judicial Academy has a special agreement on cooperation signed with EIPA institute from
Luxemburg which organizes seminars for commercial courts judges each year, which enables them to im-
prove their knowledge and follow up on the news in the relevant EU jurisprudence. Similarly, IRZ founda-
tion from Germany has a long-term agreement wit the Judicial Academy by which they commit to organize
seminars on protection of competition for both judges of Commercial and judges of Administrative court.
For more information on the present state in the field of judiciary, see Subgroup 23: Judiciary and
fundamental rights.
In terms of anti-corruption laws, it is extremely important to adopt the Law amending the Criminal
Court in order to harmonize with the recommendations of GREKO committee and the Council of Europe and
recommendation of the European Commission. Namely, certain new criminal offences are introduced such
as abuse of office by the official, fixing of results of competitions and abuse in procurement procedure, while
certain offences with corruptive elements are redefined, amended or partially altered such as abuse of office,
receiving and giving bribe. After obtaining expertise of the European Commission and public discussion,
Law amending the Criminal Code has been adopted in the Parliament of the Republic of Serbia in December
2012.

111
Working group formed by the Ministry of Justice and Public Administration, in accordance with the
recommendation of the Council of Europe and European Commission, works on the text of the Law on
amending the Law on seizure and confiscation of proceeds from crime. This law will enter into parliamen-
tary procedure in the second quarter of 2013.
It is important to mention that the Ministry of Justice and Public Administration in cooperation with
the Anti-Corruption Agency, other relevant factors, as well as in cooperation with its international partners
started drafting new anti-corruption strategy as well as the accompanying action plan.
For more information on the above mentioned, see Subgroup 23: Judiciary and fundamental rights
and Subgroup 24: Justice, freedom and security.
Ministry of Finance and Economy
Improvement of legal framework for regulating property as a central type of social and legal order, has
been initiated by adoption of the Law on Public Property (Official Gazette of RS, no 71/11) that regulates the
public property and certain other property right in the Republic of Serbia, autonomous province and local
self-government. Public property is comprised of the property right of the Republic of Serbia - government
property, property right of the autonomous province - provincial property and local self-government units
right to property municipal property i.e. city property.
The Law on Planning and Construction (Official Gazette of RS No. 72/09, 81/09, 64/10 and 24/11)
stipulates , under certain conditions, that there is a possibility for a constraction land in state ownership to
become a private property. Ministry of Finance and Economy decides on appeals submitted based on this
right, while administrative dispute can be initiated against the decision of the ministry.
The Law on Property Restitution and Compensation has been adopted (Official Gazette of RS, no
72/11) that sets the conditions, manner and procedure for restitution of the property and compensation for the
property that was seized from natural and certain legal persons and transferred into national, government,
public or cooperation societys property after 9 March 1945 by application of regulations on agrarian reform,
nationalization, sequestration as well as based on other regulations, based on acts on nationalization.
For more information on the above mentioned, see Chapter 23 "Judiciary and fundamental rights,
point 3, fundamental rights, right to property.
Activities planned in 2013 with regard to harmonization of legislation
Ministry of Justice and Public Administration
Ministry of Justice and Public Administration has through the Government Programme planned adop-
tion of a set of laws whose adoption will improve independence, impartiality and professionalism of the judi-
ciary, prosecution and will lead to reorganization of judiciary network, influence the decrease of the case
backlog, enable more efficient processing and reaching final convictions, enable more decisive and purpose-
ful combating organized crime and corruption and decrease the level of corruption as much as possible (so
called zero-corruption tolerance).
For more information on the above mentioned, see Subgroup 23: Judiciary and fundamental rights
and Subgroup 24: Justice, freedom and security.
All activities currently conducted by the Ministry of Justice and Public Administration are directed
towards strengthening of the rule of law and democracy and better functioning of the judiciary system of the
Republic of Serbia that will contribute to creation of a better image of the Republic of Serbia in the business
world and attract foreign investment, which are of extreme importance for rehabilitation of Serbian economy
and general welfare in the society.

2.2. Ability to face competitive pressure and open-market forces


within EU
2.2.1. Human resources
Labour market
In terms of employment, the main problems encountered by the Republic of Serbia are the lack of jobs
as a result of insufficient economic activity and low employment rate.

112
Unfavourable demographic trends (negative birth rate) contributed to deterioration of key indicators of
the labour market. Fundamental change in the population structure is reflected in transition of active into
passive population. The decrease of active population in total population is the result of the reduced number
of employees and, simultaneously, increase in the number of passive population.
Discrepancy between supply of and demand of workforce (a certain amount of job vacancies that are
in demand by the employers remains unoccupied while, on the other hand, there is a great number of persons
with professions that are not in demand at the labour market), high share of long-term unemployed persons
and inflow of the surplus labour and surplus of companies in the process of restructuring and privatization
(privatization process of companies and public institutions has not been completed, in 2009 the process of
forced liquidation of a company was initiated), unfavourable age and professional structure of the unem-
ployed, high rate of youth unemployment, considerable differences between regional labour markets (more
unfavourable state in the south in comparison to the north of the country, as well as in rural in comparison to
urban areas) and low workforce mobility, high share of the unemployed who belong to the category of per-
sons who are less likely to be hired (surplus employees, persons with disabilities, non-qualified persons, rural
population, Roma population, women, youth, elderly, refugees and displaced persons etc) as well as a great
number of people who are hired in informal economy are the factors that characterize and condition unfa-
vourable situation at the labour market of the Republic of Serbia.
The number of work-capable population aged between 15-64 according to the labour force survey
(LFS) form April 2012 is around 4 719 000 (2 084 000 of the employed, 735 000 of the unemployed persons
and 1 900 000 inactive). The number of active population is around 2 819 000 which represents 59.7% of
total working age population.
Key indicators of labour market in 2011-2012 for population aged between 15-64, Republic of Serbia
Age category
April 2011 November 2011 April 2012
15-64
activity rate 58,9% 59,9% 59,7%
Men 67,5% 68,7% 68,7%
Women 50,4% 50,9% 50,7%
employment rate 45,5% 45,3% 44,2%
Men 52,2% 52,5% 51,1%
Women 38,8% 37,9% 37,1%
Unemployment rate: 22,9% 24,4% 26,1%
Men 22,7% 23,5% 25,6%
Women 23,1% 25,6% 26,7%
Inactivity rate 41,1% 40,1% 40,3%
Men 32,5% 31,3% 31,3%
Women 49,6% 49,1% 49,3%
Source: LFS, Statistical Office of the Republic of Serbia
Key indicators of the labour market by region, for population aged between 15-64
Region of
Region of Region of
Age category Belgrade Vojvodina umadija
South and Kosovo i Me-
15-64 region region and West
East Serbia tohija
Serbia
activity rate 59,9% 58,4% 60,9% 59,7% ...
employment rate 46,3% 42,4% 45,0% 43,2% ...
Unemployment rate: 22,8% 27,5% 26,1% 27,7% ...
Inactivity rate 40,1% 41,6% 39,1% 40,3% ...
Source: LFS April 2012,Statistical Office of the Republic of Serbia
Employment
Employment rate in the Republic of Serbia is low. In 2012, the employment rate continued dropping,
while persons who lost jobs transitioned to the category of the unemployed, not to the category of the inac-
tive, whereby the decrease of the labour force and its withdrawal from the labour market is stopped.

113
Number of the employed and the employment rate
Age category
April 2011 November 2011 April 2012
15-64
Number of employees 2.191.392 2.141.920 2.083.604
employment rate 45,5% 45,3% 44,2%
Men 52,2% 52,5% 51,1%
Women 38,8% 37,9% 37,1%
Source: LFS, Statistical Office of the Republic of Serbia
Total number of working age (15-64) employed persons in April 2012 was 2 084 000, which is less
than the number of employed in April 2011 by 4.9% or for around 108000 persons. Employment rate of the
working age population (15-64) in April 2012 is 44.2%, which means that it dropped by 1.3 pp in compari-
son to April 2011 (45.5%).
Higher employment rate than the average employment rate is recorded in Belgrade region (46.3%) and
umadija and West Serbia Region (45.0%), while the lowest employment rate is in the Vojvodina Region
(42.4%).
Informal employment is prominent. Work in "grey economy in the Republic of Serbia is related to
the low wages and low productivity, low level of safety at work, poor working conditions, without health and
social insurance paid. Companies that work in grey economy mostly hire unqualified and unprofessional
workers. Work in informal economy, mostly recorded among the youth (26.3%), decreases with the increase
of age and work experience. Share of the working age population (15-64) employed in informal sector in
total employment of working age population is 15.5% which represents a decrease of 2.2 pp in comparison to
April 2011 (17.7%). The number of informally employed persons is around 323 000, which in absolute
amount represents a decrease by around 65 000 of persons employed in informal economy or 16.7% in com-
parison to April 2011 (388000).
Number of the informally employed personsand their share in total employment
age category 15-64 April 2011 November 2011 April 2012
number of the informally employed 387.876 338.424 323.053
share of the informally employed 17,7% 15,8% 15,5%
Men 17,4% 16,2% 15,1%
Women 18,1% 15,4% 16,0%
Source: LFS, Statistical Office of the Republic of Serbia
The mentioned situation at the labour market is also confirmed by the administrative data, which show
formal employment (research of CES/current employment survey). Formal employment continued to
drop. Total number of the formally employed in March 2012 was 1 730 000 persons which is less than the
number of the formally employed in March 2011 by 2.3% i.e. around 40 000 persons. The number of em-
ployed persons by legal persons dropped for 0.4% or around 5 000 persons, while the number of entrepre-
neurs and their employees dropped by 8.4% or around 36 000 persons.
Total formal employment, in thousands
March 2011 September 2011 March 2012
total number of registered employees 1.770 1.737 1.730
legal persons employees 1.344 1.336 1.339
entrepreneurs and their employees 427 401 391
Public sector 469 469 470
from the Budget 328 328 328
public companies 141 141 142
Source: Research of CES, Statistical Office of the Republic of Serbia
Unemployment
Unemployment rate in the Republic of Serbia is high. The number of the unemployed, as well as the
unemployment rate keeps increasing since 2008, as a result of the economic crisis impact at the labour mar-
ket.

114
The number of the unemployed and the unemployment rate
Age category
April 2011 November 2011 April 2012
15-64
number of the unemployed 649.155 690.782 735.209
unemployment rate 22,9% 24,4% 26,1%
Men 22,7% 23,5% 25,6%
Women 23,1% 25,6% 26,7%
Source: LFS, Statistical Office of the Republic of Serbia
Total number of working age (15-64) unemployed persons in April 2012 was 735,000, which is more
than the number of unemployed in April 2011 for 13.3% or around 86,000 persons. Unemployment rate of
the working age population (15-64) in April 2012 was 26.1%, which means that it increased by 3.2 pp in
comparison to April 2011 (22.9%).
Lower unemployment rate than the average employment rate is recorded in Belgrade region (22.8%)
and umadija and West Serbia Region (26.1%), while the lowest employment rate is in the Vojvodina Re-
gion (27.7%)
Unemployed persons registered with the National Employment Service
In October 2012 752.678 persons have registered with the NES, of which 391.827 or 52.1% were
women.. In comparison to October 2011 (737870 person), the number of the unemployed increased by
around 15.000 persons or 2%.
Projection lf labour market trends for the period 2013-2015
Employment projection is base on the projected growth of GDP and growth of investments. Accord-
ing to projections, the decrease in total employment will slow down in 2013, after sharp fall in previous four
years. Cumulative growth of registered employment by 3.3% is expected in the following three years
In the future three-year period total unemployment will record a slight decrease, which will be accom-
panies by a slight decrease in employment survey rate.
Assessments of the unemployment rate movement
2013. 2014. 2015.
unemployment rate 26,1% 25,2% 23,8%
Source: IMF, World Economic Outlook, April 2012, MFE assessments for the Republic of Serbia
Harmonization of the policies for employment, education and science and technological development
in order to increase the level of knowledge and skills and employment in accordance to labour market de-
mand, has special importance for productive employment in the future period.
Employment characteristics
If employment by sector is observed (agriculture, industry and services), according to the data from
the Labour Force Survey from April 2012, the biggest percentage of the employees (15-64) is in the services
sector 54.9% or around 1 145 000 employees, followed by the industry sector 27.2% or around 566 000 em-
ployees and the agriculture sector 17.9% or 373 000 employees. In the period April 2011-April 2012, the
biggest fall of employment is recorded in the agriculture sector -9.0% (decrease by 37 000 persons), fol-
lowed by industry sector -5.4% (decrease by 32 000 persons), while the services sector recorded the lowest
decrease in the number of employees -3.3% (decrease by 38 000 persons).
Employment by sector, population 25-64
April 2011 November 2011 April 2012
employees, total 2.191.392 100% 2.141.921 100% 2.083.604 100%
Agriculture 409.860 18,7% 391.935 18,3% 373.049 17,9%
Industry 598.228 27,3% 604.025 28,2% 565.726 27,2%
Services 1.183.304 54,0% 1.145.961 53,5% 1.144.829 54,9%
Source: LFS, Statistical Office of the Republic of Serbia
If we observe employment by the type of employment, according to the data from the Labour Force
Survey from April 2012, then the greatest number of employed workers is among those who work for sala-
ries 72.9% or 1 520 000 employees, while the number of self-employed persons is 428 000 or 20.1% and the

115
number of supporting household members is 146 000 or 7% (these two categories are considered vulnerable
employment). In the period April 2011-April 2012, all types of employment relationship based employment
have recorded the decline in the number of employees, but the biggest decline is recorded in the supporting
household members -10.4% (decline by 17 000 persons) followed by self-employed -5.5% (decline by 24
000 persons), while the smallest decline is recorded in the number of employed workers -4.2% (decline by
67 000 persons).
Employees by employment status, population 15-64
April 2011 November 2011 April 2012
employees, total 2.191.392 100% 2.141.921 100% 2.083.604 100%
wage-employed 1.586.210 72,4% 1.554.071 72,6% 1.519.669 72,9%
self-employed 442.725 20,2% 447.434 20,9% 418.305 20,1%
supporting household members 162.456 7,4% 140.416 6,5% 145.630 7,0%
Source: LFS, Statistical Office of the Republic of Serbia
Unemployment characteristics
Labour Market in the Republic of Serbia is characterized by discrepancy between supply and demand
of labour force, enhanced by the discrepancy in the professional qualifications and age structure, high long-
term unemployment, high rate of youth 15-24 unemployment and high unemployment rate of the persons
with lower and middle levels of education, accompanied by great regional unemployment disproportions.
In terms of age, slightly less than half of the unemployed (44.0%) are persons who belong to the two
youngest age groups (15-24, 25-34), whose share in total unemployment (15+) in April 2012 was 16.3% and
27.7% respectively.
Unemployment structure by the level of education seems pretty stable. Unemployment rate is the
greatest among the population with middle level of education, considering that slightly more than two thirds
of the unemployed graduated from a secondary school (66.8% in April 2012). Overcoming existing situation,
above all unfavourable professional qualifications of the unemployed, redundant skills and inadequate capa-
bilities, requires reform and renewal of the education system, especially the system of middle vocational
education and adult education, as well as establishment of the system for short trainings at the labour market.
Unemployment in the Republic of Serbia is a long-term problem. Many of the employees, once be-
coming unemployed, remain in that status for a very long time period. International experience shows that
the probability of finding a job decreases proportionally to duration of unemployment, which can lead to
permanent exclusion from the labour market and increase of poverty risks. Long-term unemployment rate for
the working-age population (15-64) in April 2012 was 20.4% which is an increase by 3.6 pp in comparison
to April 2011 (16.8%). Share of long-term unemployed persons (those who search for a job for a year or
longer) in the number of working age (15-64) unemployed persons is high and in April of 2012 it was 78.1%.
Waiting for an employment for a long period of time leads to loss of motivation and knowledge and decrease
of employment opportunities.
Women unemployment rate in the Republic of Serbia is higher than men unemployment rate. How-
ever, the difference in unemployment rate between men and women in April 2012 decreased and is now only
1.1 pp (26.7% for women and 25.6% for men). Differences in activity rates and employment of men and
women are still considerable. In April 2012, activity rate of women was 50.7%, while activity rate of men
was 68.7%, which represents a difference of 18 percentage points.
Women employment rate of 37.1% is significantly lower than men employment rate of 51.1% (the dif-
ference is 14 percentage points).
Unemployment rate of youth aged 15-24 in the Republic of Serbia is very expressed and is considera-
bly higher than general unemployment rate (50.9% in comparison to 26.1%) which means that every second
young person in the Republic of Serbia in unemployed. Youth unemployment rate in April 2012 increased
by 1 percentage point in comparison to April 2011 (49.9%). Youth unemployment rate in April 2012 in-
creased by 0.2 percentage points, while activity rate increased by 1 percentage point in comparison to April
2011.
Unemploymen ratet of older adults aged between 55-64 growth of unemployment rate in this age
group in the period April 2012-April 2011, is 4.5 percentage points (with 14.6% in April 2011 to 19.1% in
April 2012) which in absolute amount represents an increase in the number of the unemployed by around 22
000 persons. Employment rate of this age group decreased by 1.6 percentage points (from 31.8% in April
2011 to 30.2% in April 2012), which in absolute amount represents a decrease by 12 000 persons. Activity

116
rate increased by 0.1 percentage point (from 37.2% in April 2011 to 37.3% in April 2012), which in absolute
amount represents an increase in the number of active persons by around 11 000 persons.
Employment policy objectives
Employment policy is dealt with in details in Chapter 19: Social policy and employment in the part
Employment and European Social Fund.
Strategic plans in the field of employment are determined by the National Employment Strategy for
the period 2011-2020 (Official Gazette of RS, no 37/11), that was adopted in May 2011. The main objec-
tive of the employment policy of the Republic of Serbia until 2020 is setting efficient, stable and sustainable
trend of employment rate growth and harmonization of the employment policy, as well as labour market in-
stitutions, with the EU standards. Activities will primarily be directed towards increase of employment rate
through investment in human resources and greater social inclusion. (For more information see Chapter 19:
Social policy and employment).
Specific objectives of the employment policy in 2013 are defined by the National Employment Ac-
tion Plan for 2013 (Official Gazette of RS, no 117/2012). (For more information see Chapter 19: Social
policy and employment).
State of the labour market of the Republic of Serbia, Labour Force Survey indicators, as well as analy-
sis of the data from the reports of the National Employment Service influence determination of priorities for
action within the scope of defined objectives. Measure of active employment policy for 2013 will be realized
as a priority through a package of services for youth, packet of services for labour surplus, creation and reali-
zation of specific measures and activities directed towards categories who are less likely to be hired and spe-
cially vulnerable groups at the labour market as well as facilitation of self-employment, social
entrepreneurship and cooperative societies.
Youth unemployment
In terms of age, slightly less than half of the unemployed (44.0%) are persons who belong to the two
youngest age groups (15-24, 25-34), whose share in total unemployment (15+) in April 2012 was 16.3% and
27.7% respectively. In terms of age, slightly less than half of the unemployed (44.0%) are persons who be-
long to the two youngest age groups (15-24, 25-34), whose share in total unemployment (15+) in April 2012
was 16.3% and 27.7% respectively.
Unemployment rate of youth aged between 15-24 in the Republic of Serbia is very high and is consid-
erably higher than general unemployment rate (50.9 in comparison to 26.1%). Youth unemployment rate in
April 2012 decreased by 1 percentage point in comparison to November 2011 (51.9%). However, even with
the decrease in the unemployment rate, it shows that every second young person in the Republic of Serbia is
unemployed15.
Ministry of Youth and Sport, in accordance with its competencies, is conducting activities on imple-
mentation of measures directed towards increase of youth employment within the scope of implementation
of National Youth Strategy and Strategy for Career Guidance and Counselling.
Activities being conducted: Informing the youth population on possibilities for employment, self-
employment, conditions for starting own business, training in business planning, financial operations, mar-
keting, work ethics, training for active job search and career informing of the youth, employment fairs.
Education
On 25 December 2012, Government of the Republic of Serbia adopted the Strategy for education de-
velopment in Serbia until 2020, as a vision of desirable and feasible future state of educational system in the
Republic of Serbia by 2020 and beyond (2020+). Constant increase in the quality of educational system and
increase of investments in education accompanied by system changes, establishment of educational system
that enables greater flexibility and safety at the labour market, as well as strengthening of relations between
educational institutions, research centres and economy by inciting cooperation programmes, are basic pa-
rameters for improvement of the educational system of the Republic of Serbia.
Increase of public financing of education from current 4.5% to 6.0% of gross domestic product by
2020 will be directed, primarily, towards providing and improving resources and conditions that lead to-
wards improvement in the quality of education. Adoption of the Action plan for implementation of the
Strategy is expected in the second quarter of 2013.

15
Source of the data: Labour Force Survey (LFS), April 2012. Published by Statistical Office of the Republic of Serbia

117
For strategic orientation by 2020: increase of the scope, relevance and efficiency of education comple-
tion, quantitative indicators are determined by levels of education, upbringing and age, starting from the
youngest, children of six months; these indicators envision full inclusion of children from 5.5 to 6.5 years of
age in all-day or half-day forms of preparatory preschool program; reducing dropping out of school to
maximum 5% and increasing primary school completion to 93% of the generation; enrolment in a secondary
education school of at least 95% of the students who completed primary school i.e. 88% of the generation;
graduation from four-year secondary education schools of at least 95% of the enrolled students; enrolment to
the university of at least 40% of those who completed secondary education, timely graduation or one year
late graduation from the university of at least 70% of the enrolled students; enrolment in master programs of
at least 50% of the students who completed bachelor degree and enrolment in PhD programs of at least 10%
of students who graduated from master programs; having at least 10% of PhD programs in common with
foreign universities; involvement of at least 7% of the population in one of the programs for adult education
and life-long learning.
For Priorities in 2013 with regard to harmonization of legislation see Chapter 26.
Informal education In terms of implementation of the objectives from the National Youth Strategy,
informal youth education is one of the priorities.
During 2012, Ministry of Youth and Sports (Sector for Youth) financed total of 82 projects proposed
by youth associations, associations for youth and local youth offices, which were directly or indirectly target-
ing informal education including activities of informal education for 7.280 users.

2.2.2. Physical capital


Traffic
Overview
The most important segments of Transeuropean network at the territory of the Republic of Serbia are:
1. Corridor X with it branches: Xb (Belgrade-Budapest) and Xc (Nis-Sofia), represents the most impor-
tant road and railway route on the territory of the Republic of Serbia. It was established as a part of
south east multimodal axis defined in Final report of HLG; it is a part of Core Regional Transport
Network linking Austria/Hungary, Slovenia/Croatia, republic of Serbia and Bul-
garia/Macedonia/Greece. It contains 792km of roads and 760 km of railways in the Republic of Ser-
bia;
2. Corridor VII (the Danube river) that connects Central Europe via Republic of Serbia with the Black
Sea and is a part of South East multimodal axis, is a border river and it flows through the territory of
the Republic of Serbia in the length of approximately 600 km. Republic of Serbia is surrounded by
Pan-European corridors and their branches: Budapest-Arad-Craiova-Sofia-Thessaloniki (Corridor IV),
Arad-Bucarest-Constanta (a branch of Corridor Iva), Budapest-amac-Sarajevo-Ploe (a branch of
Corridor Vc), Vlore-Tirana-Skopje-Sofia (Corridor VIII). Furthermore, in the surrounding of the Re-
public of Serbia is Adriatic Highway, that will connect branches of the Corridor Va and Vc (Rijeka-
Ploe) along the Adriatic coast through Montenegro, with the Corridor VII in Vlore.
European Commission, within IPA programme Instrument for Pre-Accession Assistance and inter-
national financial institutions EIB, EBRD and WB support large investment projects in the Republic of Ser-
bia, oriented towards urgent maintenance projects, building and reconstruction of infrastructure and projects
targeting institutional capacity building. European Union has invested around 85 million through IPA fund
in the field of transportation since 2007. For 2011 only 13.8 million was contributed from the programme
package for modernization of railway Corridor X (documentation for railway Novi Sad Subotica and rail-
way ring around Ni) and building of eelj bridge access roads. In the last years more and more funds are
donated for concrete infrastructural projects such as building of the eelj Bridge though IPA Programme
2009 package with national co-financing. Continuation of this trend will significantly contribute to moderni-
zation of traffic infrastructure and inclusion in European transportation flows, for which the Republic of Ser-
bia lacks own funds.
Rail transport
The Republic of Serbia has a strategic position at the railway market of South East Europe. Out of to-
tal 3809 km of railway network, 272 km are double-track railways while 1247 km have been electrified.

118
Tracks gauges are 1435 mm, except for museum and tourist railways arganska Osmica/Shargan Eight
whereat tracks gauges are 760 mm.
Electrical and technical equipment dates from the period 1969-2000. At 60% of railways, the speed is
less than 60km/h and at only 3.2% the speed exceeds 100km/h. Freight capacity is less than 18 tons per
wagon at 39% of the railways length.
Zeleznice Srbije (Serbian Railways JSC") owns around 333 tractive vehicles, 8491 freight and 784
passenger cars. Rolling stock is relatively old and unreliable. Average age of rolling stock exceeds 30
years.
Corridor X (Salzburg-Ljubljana-Zagreb-id-Beograd-Ni-Preevo-Skoplje-Veles-Solun) with
branches through Subotica towards Hungary and Dimitrovgrad towards Bulgarian border represents the
spine of the railway network in Serbia. In total length of 872 km (25% of the network), over 50% of railway
activities are carried out on it. The business of Zeleznice Srbije is feeling the impact of the world eco-
nomic crisis but it is also adversely influenced by the poor state of infrastructure and old rolling stock, due to
several decades of insufficient investments.
By providing budget guarantees for the railways, the state has confirmed its orientation to facilitate ac-
tivities directed towards comprehensive reform and modernization of railway traffic.
The following projects for modernization and rehabilitation of railway infrastructure are in the phase
of realization or planned to be realized:
- Project of building of the eelj Bridge, as a part of Corridor X reconstruction, which will lead to
increase of the road and rail traffic in this part of the Corridor. Total investment is worth 45.3 mil-
lion, out of which 26.2 million comes from IPA funds, 12.7 million is provided by Vojvodina
while 6.4 million by the city of Novi Sad. Construction will be finished by November 2013.
- Realization of the project titled System for the analysis of the track conditions, which is financed
from the IPA fund in the amount of 3 million, was initiated in October 2010 and will last until the
and of 2013. General objective of the project is to develop and introduce a track infrastructure sur-
vey and information system as assistance in planning of railway maintenance and reconstruction
and accurate monitoring of train movement, in accordance with EU standards.
- Remaining projects are described in more details in chapters 3.14.1.2, 3.14.1.3. and 3.21.1.
Besides completion of the mentioned projects, reconstruction and modernization of the Corridor X is
planned, in order to increase projected average speed from 160 km/h to 220 km/h i.e. decrease travel time.
Necessary funds for completion of the reconstruction are assessed at over 4 billion in the next 8 years.
Similarly, the following projects for procurement and overhauling of the rolling stock are realized or
in the phase of realization:
- From 60 million worth EBRD II loan, the following was procured: 782 freight cars, supporting
tyre lathe used to restore the profile of wagon wheels, reconstruction of the hall to accommodate
lathe and vertical CNC lather.
- 12 diesel engine sets have been delivered, whose procurement was financed by EUROFIMA in the
amount of CHF 43 million.
- 100 million was contributed from EBRD III loan for procurement of over 20 new electric trains
for regional passenger traffic. Completion deadline is 2015.
- 65 million was provided from the EBRD IV loan for procurement of 15 multi-system locomo-
tives. This project is expected to be completed by 2015.
- From the loan provided by the Russian Federation that was signed in January 2013, funds are pro-
vided for procurement of a certain number of diesel trains whose estimated values is 75 million.
Subsidies for Zeleznice Srbije in 2012 from the budget of the Republic of Serbia amounted to RSD
13 810 billion (around 120 million), while for 2013 the subsidies are planned to amount to RSD 14
565billion (around 126 million). Zeleznice Srbije continued the process of restructuring which was ex-
plained in more details in chapter 3.14. Transport policy, i.e. 3.14.1.2. Rail Transport
Intermodal transport
Activities on construction of intermodal terminal in Batajnica are ongoing, which is elaborated in
chapter 3.14. Transport policy, i.e. 3.14.1.2. Intermodal (combined) transport.

119
Future intermodal terminal will be directly connected to Corridor X i.e. it will be connected to railway
station in Batajnica through the service road to loop Batajnica (whose construction is presently being fin-
ished). The surface of intermodal terminal with access roads is around 13 ha. According to the project, in-
termodal terminal will feature: 3 railway tracks 650 m long (2 loading tracks for loading and unloading of
containers and 1 additional shunting track; 4 truck lanes (1 transiting, 1 loading/unloading, 1 reserve and 1
emergency exit lane; container storage (3 container lines for temporary storing of containers, frigo-
containers, swap bodies and containers with hazardous load), parking for freight and passenger vehicles,
terminal administration building and customs building, while in terms of mobile assets it will feature: 1
shunting diesel locomotive, 1 mobile crane (reach stracker) and the equipment for break testing. Also, the
project envisions construction of access railway track in length of 600 m and access road in length of 700 m.
According to the analysis of market and traffic flows, intermodal terminal is projected to service 7-12
container trains, i.e. to sustain annual capacity of around 80 000 TEU. Intermodal terminal will have the pos-
sibility of spatial/phase expansion and equipping, according to the market requirement, in order to satisfy
annual cargo capacity of 240 000 TEU. Establishment of logistic centre in proximity of the intermodal ter-
minal is planned at the 80 ha surface.
Road Transport
Road transport represents a dynamic and dominant mode of transport in Serbia with the share of 80%
in total freight transport i.e. 74% in total passenger transport. Economic entities that perform road transport
are now mostly fully privatized (exceptions are several companies who are to be privatized) and operate in
the conditions of free competence, while the role of the state is limited to regulation of this field as regards
issuance of licences, permits for road transport, monitoring etc. Management of the I and II category state
roads, as well as management of the road traffic, pursuant to the Law on Public Roads is within competences
of the public entity "Putevi Srbije (Roads of Serbia"). This entity manages around 10 000 km of rounds in
Serbia. Road entities, which are according to the contract with the public entity, competent for maintenance,
rehabilitation and reconstruction of public roads had been privatized.
Owing to the increase of the number of private transport entities and presence of foreign investments
in the road transport sector, the competition is increasing at high rate. It is extremely important to preserve
and improve competitiveness of domestic transport undertakings by professional and rational management of
the undertaking and by transport operations by observing the principle of non-discrimination, fair competi-
tion, safety improvement and improvement of the service quality. More favourable economic conditions for
companies, flexibility and ability of timely response to the challenges of contemporary economy enabled the
highest share of road transport at the transport market. Taking into consideration geographic location of Ser-
bia as a transit country, road transport, especially international, plays an important role in the economic de-
velopment due to constant growth.
Air Transport
Civil Aviation Directorate. Civil Aviation Directorate of the Republic of Serbia is founded by the
Law on Air Traffic (Official Gazette of RS, no 73/10, 57/11 and 93/12), as a public agency, the founders'
rights over which are exercised by the government on behalf of the Republic of Serbia.
Serbia and Montenegro Air Traffic Services Agency (SMATSA) limited liability company. Serbia and
Montenegro Air Traffic Services Agency LLC Belgrade is established by the Contract between the govern-
ment the Republic of Serbia and the Government of the Republic of Montenegro as a limited liability com-
pany in order to provide air traffic services in the airspace of the Republic of Serbia, Republic of
Montenegro, 55% of the Upper Airspace of Bosnia and Herzegovina as well as international waters of the
South part of Adriatic sea.
"Nikola Tesla" Airport Pursuant to the decision of the Government of RS no 023-4432/2010-1 from 17
October 2010 on the change of legal form public entity Airport Nikola Tesla Belgrade changed its legal form
from public entity to closed joint-stock company. Due to the change of legal form, capital assessment has
been performed concluding with the state on 1 January 2010. According to the assessment, core capital of
the JSC Airport Nikola Tesla on 1 January 2010 amounts to 214,556,965.99 or RSD 20,573,610,000.00.
Core capital is converted to 34,289,350 ordinary shares of face value of RSD 600.00.
JAT Airways. Based on the provisions of the Law on Government, the government of the Republic of
Serbia has on 16 November 2012 issued the decision on establishment of Working group for condition
analysis and preparing recommendations of measures for stabilization and recovery of "JAT AIRWAYS
JSC Belgrade, for a one year period after this Decision has entered into force.

120
The task of the Working Group is to analyse conditions in the economic society and current market
conditions in the field of air traffic and based on this to prepare to the Government a recommendation of
measures for stabilization, recovery and profitable business of the joint-stock company for air traffic Jat
Airways" Belgrade.
Water transport
By connecting the North and the Black sea with the Rhine-Main-Danube channel, the part of the Da-
nube in the Republic of Serbia can represent one of the most important elements in the economy and trans-
port policy of the Republic of Serbia. The Republic of Serbia has a very developed network of 1600 km of
water ways and channels and it includes: The Danube 588 km, The Sava 211 km, The Tisa 164 km, The
Tami 41 km and DTD channel 599 km.
Water transport of the Republic of Serbia is comprised of: Water ways, ports, harbours and fleet. Wa-
ter ways are arranged, maintained and marked according to the responsibilities of the country to provide
conditions for safe sail of all vessels on its part of international water way of the rivers Danube and Sava and
interstate water way of the river Tisza. Presently in the Republic of Serbia measures are being undertaken in
order to eliminate the critical sports that jeopardize safe navigation.
In accordance to the EU standards, River Information Services, which provide monitoring of all boats
in our part of the Danube River, have been introduced. Completion of this project and initiation of RIS op-
erations at the rivers Danube and Sava is expected by March 2013.
The Law on Navigation and Ports on Inland Waterways (Official Gazette of RS no 73/10 and 121/12)
ports and harbours are declared good of public interest, while strategic and administrative management of the
ports based on Landlord model is trusted to the Ports Management Agency (for more details, see Chapter
21.1).
Investments in the water transport in the Republic of Serbia have a significant ecological aspect.
Namely, the fuel consumed for the same amount of goods transported is the smallest in water transport.
Electronic Communications
Overview
Laws: The government adopted 6 strategic documents in the field of electronic communications:
Strategy for the development of electronic communication in the Republic of Serbia from 2010 until 2020,
Strategy for switchover from analogous to digital broadcasting of radio and television programmes in the
Republic of Serbia, Strategy for the development of broadband access in the Republic of Serbia till 2012,
Strategy for the broadcasting development in the Republic of Serbia till 2013, Strategy for development of
information society in the Republic of Serbia by 2020, Strategy for the development of postal traffic in the
Republic of Serbia. The Law and strategic documents regulating the field of electronic communications are
listed in chapters 3.3.3. Postal Services and 3.10. Information Society and Media.
The income of around 1.6 billion has been made at the market of electronic communications of the
Republic of Serbia, which is around 10% higher in comparison to the previous year. This growth of income
is at the level of compound annual growth rate (CAGR) of the income from services in the sector of elec-
tronic communications (CAGR for period 2005-2011 is 9.52%). In 2011 the share of telecommunication is
the GDP of the Republic of Serbia was 5.66% (in 2010 this share was 5.29%). Total investments in the sec-
tor of electronic communications in 2011 were around 243 million.
In terms of share of each of the branches (of services), in 2011 there were no significant changes in total
income from the market of electronic communications in the Republic of Serbia in comparison to the previous
year. Namely, the income made from mobile telephony services in the amount of almost 847 million, com-
prise the majority of income made in 2011 while its share in total income is almost 53%. Furthermore, invest-
ments in mobile telephony in 2011, amount to more than half of total investments realized at the market of
electronic communications in the Republic of Serbia reaching 57%.
The increase in the number of Internet users in Serbia in 2011 has continued and it has now reached
3,828,721, which represents and increase of 68% in comparison to 2010 (2,275,900). Owing to continuous de-
velopment of telecommunications in the filed of Internet broadband access, the number of broadband access
users has been increasing in comparison to 2010. Also, the number of dial-up access users continues to fall
dramatically, which is a trend both in the EU and the region.
In public fixed telephony network, in 2011, the following operators had the licence to provide public
fixed telephony network and services:

121
- Telekom Srbija AD, Telecommunications company Telekom Srbija AD (JSC)
- Media Works d.o.o. that changed its name to Orion telecom d.o.o. (LLC)
- Telenor d.o.o. (LLC)
Telekom Srbija AD has been providing services through public fixed telecommunication network and
public fixed wireless telecommunication network (FWA). Orion operator has been providing services via
public fixed wireless access (FWA), while Telenor, in accordance to the licence conditions, during 2011,
initiated provision of commercial services of public fixed telecommunication network.
Income from provision of telephone services of all licence holders (Telekom Srbija AD, Orion telecom
d.o.o and Telenor d.o.o.) at the territory of the Republic of Serbia in 2011 amounts to RSD35.7 billion, out of
which RSD 760 million are incomes from services provided via public fixed wireless telecommunication net-
work (FWA). Income from international traffic in 2011 amounts to RSD8.1 billion, which comprises the total
income of around RSD 43.8 billion. Incomes from code division multiple access (CDMA) in 2011 participate
with 1.7% in total incomes from fixed telephony services. In 2011, investment in the field of fixed telephony
services is around RSD 5.8 billion, which is less for RSD 2 billion or 25% in comparison to the previous year.
In 2011, there are three Operators at the market of mobile telephony of the Republic of Serbia:
- Telecommunications company Telekom Srbija AD Mobile telephony of Serbia MTS
- Telenor d.o.o.
- Vip mobile d.o.o.
In 2011, income made from the mobile network services was RSD 86.5 billion, i.e. 846,7 million.
Total investments in third part of electronic communication market have increased in comparison to the pre-
vious year and amount RSD 14.16 billion. Observed in dinars, during 2011, income from the mobile teleph-
ony increased for about 8.7% in comparison to the previous year, when this income was RSD 79.6 billion.
Expressed in euros, the income recorded growth by 10.08%, and this difference in comparison to the growth
observed in dinars is the consequence of the lower average Euro exchange rate in 2011 in comparison to
2010. Total number of users of mobile telephony has slightly increased in comparison to the previous year
and amounts to 10,182,023. The growth of the number of users is declining year by year, which is confirmed
by average annual growth rate. Average annual growth rate of the number of users of mobile telephony in
the period 2003 2011 is positive and amounts to 15%, however it is lower in comparison to the period 2003
2010 when it was around 17%.
Internet market in the Republic of Serbia has continued to grow in 2011, as it has been in the previous
years. Total number of broadband internet connections in the Republic of Serbia in 2011 exceeded 1.2 mil-
lion (excluding 3G network subscribers) which is around 95% of all internet connections (excluding 3G net-
work subscribers). The most represented mode of Internet access in the republic of Serbia in 2011 was DSL
access with around 623 000 connections and it amounted to 51% or all broadband connections (excluding 3G
network subscribers). In December 2011, 232 Internet providers in Serbia were registered in the registry.
Total income from provision of Internet services in 2011 increased for about 10% in comparison to
2010 amounting to RSD14.9 billion. Total number of subscribers for Internet services in 2011 exceeded 1.2
million. However, if we consider the possibility of accessing the Internet via 3G mobile network (by using
mobile phones), total number of potential subscribers in 2011 had reached approximately 3.8 million, which
is 59% higher than the previous year. The number of Internet subscribers per 100 persons in 2011 was ap-
proximately 53, while the number of broadband Internet subscribers per 100 persons was also within this
framework due to extremely small share of the narrowband access. If 3G subscribers are not taken into con-
sideration when doing calculations, share of broadband internet access is almost 17%. Share of fixed broad-
band access is around 13%, which, in comparison to the previous year data, is a satisfying percentage with
regard to the neighbouring countries while it is above the EU average (according to the data available for
2010: candidate states and potential EU candidate states 10.6%, EU member states 26.6%).
The market of media content distribution in the Republic of Serbia in 2011 did not significantly
change in its structure and broadcast technologies in comparison to the previous year. Namely, in 2011 82
operators for provision of this service were registered (in 2010 80 operators) who provided their services via
the following telecommunication networks:
- Cable distribution network (coaxial, hybrid and optical) KDS, which include both analogous and
digital KDS, 76 operators;
- Public fixed telephone network IPTV, 3 operators;

122
- Satellite distribution network (Direct to Home) DTH, 3 operators.
The biggest distributor of media content in the Republic of Serbia in 2011, in terms of number of sub-
scribers and incomes generated, remains economic entity Serbia Broadband JSC- Srpske Kablovske Mree
d.o.o. (SBB) with over 50% share in the market.
In 2011 the market was characterized by significant increase in the number of IPTV subscribers of
37% in comparison to the previous year (increase in the number of KDS subscribers was 14%). Taking this
into consideration, as well the 3 million of potential IPTV subscribers (fixed telephony subscribers), the
change of entire landscape of the media content distribution market can be expected in the future period.
In the field of information society, the development is directed towards accomplishing objectives set
forth in the Strategy for the development of information society in the Republic of Serbia by 2020 (Official
Gazette of RS, no 51/10). Significant improvement is accomplished by inciting development of e-
Government, which improved economic efficiency and the life quality of the citizens. Regulatory setting
for introduction and development of e-Government, which encompasses the Strategy for development of e-
Government (Official Gazette of RS, no 83/09, 5/10) as well as legal framework for e-documents, e-
signatures, e-trade, cyber criminal and personal data protection have been created. Among other initiatives,
e-service portal has been developed in Serbia.
Ministry of Foreign and Internal Trade and Telecommunications has completed the project Digital
School, which was related to procurement of computers, computer equipment, proper software and installa-
tion of local networks in all primary schools at the territory of the Republic of Serbia. The Ministry has in-
cited development of e-education through organization and implementation of the Digital lesson" competition
for primary school teachers. Furthermore, in order to enable easier communication of the citizens with the pub-
lic authority bodies, Ministry carried out a tender for design of web and mobile applications through the pro-
gramme Promotion of the communication between citizens and public authorities via Internet.
In the field of information society progress has been made by adoption of the Law on Electronic
Document (Official Gazette of RS, no 51/09), Law on Electronic Commerce (Official Gazette of RS, no
41/09), and the following by-laws for implementation of the Law on Electronic Signature: Rulebook on De-
tailed Conditions for Issuing Qualified Electronic Certificates (Official Gazette of RS, no 26/08); Rulebook
on Technical-technological Procedures for the Formation of Qualified Electronic Signatures and the Criteria
to be Fulfilled by Funds for the Formation of Qualified Electronic Signatures (Official Gazette of RS, no
26/08, 13/10); Rulebook on the Register of Certification Bodies Issuing Qualified Electronic Certificates in
the Republic of Serbia (Official Gazette of RS, no 26/08); Rulebook on Records Keeping of Certification
Bodies (Official Gazette of RS, no 48/05, 82/05 and 116/05) and the bylaw on implementation of the Law on
Electronic Document: Rulebook on Time-stamping (Official Gazette of RS, no 112/09). These rulebooks are
harmonized with the newest EU standards, recommendations and procedures in this field.
Postal services sector in the Republic of Serbia with more than 40 operators, who provide postal ser-
vices in the field of collecting, processing and transport of mail, packages as well as express mail transport is
presently employing around 18,800 workers, which represents 0.79% of all employees in the Republic of
Serbia. Total income generated by the postal services activity in 2011 is around RSD11 billion, which is
around 0.32% of 211 GDP.
The Law on Postal Services (Official Gazette of RS, no 18/05 and 30/10), as well as the Law on Vali-
dation of the Universal Postal Union acts (Official Gazette of RS, no 42/2009) the obligation of the Republic
of Serbia to provide universal postal services has been determined. This obligation is presently performed by
public postal operator i.e. public entity of PTT communications Serbia (abbreviated Post of Serbia). Foun-
der of the P.E. of PTT communications is the Republic of Serbia, while founder's rights on behalf of the
founder are exercised by the Government. The company's operates with 100% state-owned assets.
Measures for Implementation of Priorities in 2013
In the field of postal traffic activities are directed towards improvement of the strategic framework
with a view to redefine the direction of postal traffic development in the next four years. The working group
for drafting the new postal strategy is formed and it includes representatives of the Ministry of foreign and
internal trade and telecommunications, Republic Agency for Postal Services and the Faculty of Transport
and Traffic Engineering. The work of the working group on the strategy is approaching the end, while public
debate is scheduled for the beginning of 2013. New strategic framework will define the dynamics of the fur-
ther harmonization of postal legislation with the EU regulations, further steps in the process of liberalization,
as well as further activities on improvement of postal market in the Republic of Serbia.

123
Besides the above mentioned, it is planned to adopt the Law on ratification of the acts from the 25th
Universal Postal Congress, as well as to continue with the activities on harmonization of the legal framework
with the postal directives.
Overview of current and planned foreign development aid
Activities on corporatization of public postal operator i.e. P.E. of PTT communications "Serbia" have
been conducted in the previous period. Namely, Ministry of Finance and Economy is the holder of the pro-
ject of corporatization of P.E. of PTT communications Serbia based on IDF Grant for Incorporation of
State Owned Enterprises Project IDF Grant No. TF096223). Working group of the MFE is currently en-
gaged in selection of consulting company that will realize it. The realization of the project is planned by the
end of April 2013, when the instruments of incorporation of the public postal operator will be adopted.
Energy
Overview
Within the scope of the energy system of the Republic of Serbia the domestic primary energy re-
sources are exploited (coal, oil, natural gas, renewable energy resources), import and export of electricity and
energy resources (before all oil and natural gas), production of electricity and thermal energy, exploitation
and secondary processing of coil, as well as transport and distribution of electrical and thermal energy to end
users of final energy.
Energy balance of the Republic of Serbia for 2011 contains annual data on energy flows for the terri-
tory of the Republic of Serbia, without the Autonomous Province of Kosovo and Metohija. The balance
does not fully show usage of renewable energy resources, considering that this part of the energy statistics is
still in the process of completion in the Statistical Office of the Republic of Serbia. In 2011 Serbia produced
11,163 Mtoe of primary energy. This production satisfied almost 70% of total demand for primary energy.
The structure of domestic production of primary energy is as follows: Production of coil is 7,823 Mtoe of
total domestic primary energy production, while the remaining part is related to the crude oil production, hy-
dro potential, petroleum production, wood fuel and natural gas.
Total consumption of primary energy in 2011 was 16,192 Mtoe. Import dependency of Serbia in 2011
was 30.28%. During 2011 import mostly included crude oil and oil products 53%, natural gas 24% and coil
14% etc.
Image 1. Primary energy production structure by energy resource in Serbia in 2011

/ Coal
10%
4% / Oil
69%
/ Natural gas
<1% 7%
9% / Hydro

In the consumption structure for transformation processes, oil consumption with 64% is the most
dominant, followed by crude oil 21%, oil products 3%, natural gas 6% and hydro potential 6%.
Graphic view of total primary energy consumption by energy resources is given in Image 2.

124
Image 2. Total primary energy consumption by energy resources

5% <1% <1% 6%
/ Crude oil
7% 12%
/Oil derivates

/ Natural gas
16%
/ Hydro
53%
/Electric energy

Total final energy consumption in Serbia in 2011 was 10,042 Mtoe, out of which 0.79 Mtoe was used
for non-energy use, while consumption of final energy for energy use was 9,252 Mtoe.
By sectors of consumption, final energy was mostly used in the household sector (35%), industry
(29%), traffic (22%), while the share of other sectors was 14%.
Final energy consumption for energy purposes by sector of consumption is given in Image 3.
On the other hand, the most dominant energy resource in the final energy consumption is oil with 30%
and electricity with 26%, followed by coil with 14%, natural gas and thermal energy with 10% each, while
renewable energy resources (wood fuel) participate with 11%. Total final energy consumption for energy
purposes by energy resource is given in Image 4.
Image 3. Distribution of final energy consumption in energy purposes by sector of consumption

Image 4. Total final energy consumption for energy purposes in 2011 by energy resource

Strategic framework
Pursuant to the Law on Energy, energy policy is defined through three fundamental documents: En-
ergy development Strategy, Program for realization of the Strategy and Energy balance. Energy development
strategy until 2015 is a document elaborating overall development in the field of energy in Serbia. Energy
development strategy was adopted by the National Assembly 2005 and it defines long-term objectives and
their priorities. Detailed list of all activities, measures and projects that need realization is included in the
Strategy realization programme. Strategy realization programme is prepared for the period from 2007 to
2012 and was adopted in January 2007 (Official Gazette of RS, no 17/07 and 73/07), while its amendments
were adopted in 2009 (Official Gazette of RS, no 99/2009) and in April 2010 (Official Gazette of RS, no
27/2010). Strategy realization programme defines all measures, activities and projects that need to be imple-
mented in all energy sectors including protection of environment, with a view to realize the objectives envi-
sioned by the Strategy.
Energy balance of the Republic of Serbia is made every year. Balance includes energy flows for three
years: Realization of the last year's balance, assessment of conditions for the next year and the plan for the

125
next year. This document is adopted by the government of the Republic of Serbia on a proposal of the Minis-
try of Energy, Development and Environmental Protection .
The new energy development strategy of the Republic of Serbia by 2025 with projections until 2030 is
being drafted with a view to define the new directions in development in accordance to the activities and ob-
ligations that ensue from the Treaty on establishing energy community and the EU accession process. After
adoption of the new Strategy, the new Strategy realization programme will also be made.
Restructuring of energy sector companies
In electrical energy sector, the government has established two completely independent companies
Public Enterprise for electric energy production, distribution and trade, P.E. Electric Power Industry of Ser-
bia (JP EPS) and the enterprise for electric energy transmission and transmission system control P.E. Elek-
tromrea Srbije (JP EMS), which started operation on 1 July 2005. All activities related to separating
entities that were not in the sector of electrical energy from JP EPS and JP EMS have been completed 20
entities were unbundled. The number of employees was reduced from 60,000 in 2001 to 36,700 in 2012,
including 5,000 workers from Kosovo and Metohija. Both companies are 100% in state ownership. The gov-
ernment also separated the property of JP EMS from the property of JP EPS.
JP EPS is organized as a vertically integrated entity holding which is 100% owned by the Republic
of Serbia and is itself the owner of subsidiary companies .Subsidiary companies are independent legal per-
sons with separated management, separated account, and functionally separated, in line with the acquis.
JP EPS as a parent undertaking pursues electrical energy from production companies and issues in-
voices to electricity distribution companies. In case its own production does not satisfy the demand of tariff
buyers, JP EPS is legally obliged to provide the missing quantities from the market.
All subsidiary companies have legal obligation to separate each specific activity in internal bookkeep-
ing, which is supervised by the Energy Agency.
There is a clear need to transform JP EPS to a modern organized joint-stock company, i.e. to co-
privatize it. Activities on rationalization and restructuring of P.E. Elektroprivreda Srbije in 2013 are directed
towards meeting necessary economic, organization and human resource requirements for realization of busi-
ness objectives and investment development considering significant changes in regulations. In this planning
period, prioritized activities will be directed towards change of legal form and creation of conditions for
starting operation of P.E. EPS control company in the form of joint-stock company.
Financing resources for new necessary investments in electric energy sector by 2015 will be provided
from the P.E EPS's own resources, loans and expected strategic partner.
In accordance with the Fiscal strategy for 2013, with projections for 2014 and 2015, which was
adopted by the government on a proposal from the Ministry of Finance and Economy (Macroeconomic
framework for the period 2013-3015, price liberalization in Serbia will be continued in the following three
years. Gradual foreign trade liberalization and improvement of competition policy will indirectly contribute
to formation of prices in competitive environment. Adjustment of prices in the field of natural monopolies on
economic principles, accompanied by transfer of competences for approving the increase in prices in infra-
structural activities to regulatory bodies, will be continued. The most important measures are increasing the
price of electricity to economical level, as a necessary requirement for improving competitiveness of the P.E.
Elektroprivreda Srbije and realization of new investments. When determining prices of electrical energy, the
Energy Agency will take into consideration economically justified expenditures and the profit that provides
resources for new investments and development of electrical energy sector.
In 2005 the national oil company of Serbia, that was performing all activities in the field of oil and
gas, was reorganized. By the decision of the government of the Republic of Serbia, on 1 October 2005, the
following entities started operation: Joint-stock company for petroleum and petroleum products exploration,
production, processing and marketing and natural gas exploration and production "Naftna Industrija Srbije";
public entity for crude oil and petroleum products pipeline transport "Transnafta and public entity for trans-
port, storage and marketing and distribution of natural gas "Srbijagas.
Further reorganization of P.E. Srbijagas in accordance to the provision of the Energy Law (Official
Gazette of RS no 57/11, 80/11 - correction 93/12 and 124/12) which prescribes that a system operator who is
a part of a vertically or horizontally integrated company, must be independent in terms of his legal form, or-
ganization and decision making from other activities related to transport system management, i.e. storing of
natural gas where the ownership over the transport system resources does not have to be separated from the
vertically integrated company.

126
In mining sector, Public enterprise for underground coil mining JP PEU) is in the process of restruc-
turing.
Mineral resources
Total production of mineral resources in the last several years amount to around 53,000,000 tons on
annual basis, out of which coil production is 40,000,000 tons, while non-metal production is 10,000,000
tons. As far as active mines with physical production scope and installed work capacities, there is total of 80
non-metal mines, out of which 74 active, 3 are bankrupt and 3 are in the process of restructuring, while there
is 8 active metal mines, out of which RTB Bor has 4 mines. There is a total number of 13 coil mines, out of
which the MB Kolubara has 4 surface mines, TPP Kostolac 1 surface mine, while public enterprise for un-
derground mining REMBAS Resavica has 8 mines. The number of entities registered for ore extraction is
269.

For more information on the planned legislative activities of the Ministry of Natural Resources, Min-
ing and Spatial Planning in 2013, see chapter 3.15. (Energy) and 3.27 (Environment).
Condition of environmental infrastructure
There are numerous limiting factors that influence the capacities for full implementation of EU acquis
in the field of environment. The current state of environmental infrastructure and the initial level of services,
cross-subsidization and failure to apply the economy of scope in the field of communal activities; limited
affordability at the household income level, which limits recovery of the full expenditure price from end us-
ers in relation to the real price of the communal service; insufficient affordability on the national level, that
represents percentage of gross domestic product (GDP) that can be afforded for projects in the field of envi-
ronment, insufficient administrative capacities to plan and optimally program all available financial re-
sources, insufficient local administrative capacities and insufficient citizen awareness of the importance of
this policy, its expenditures and gains.
According to current assessment from the National strategy for approximation in the field of environ-
ment and taking into consideration the condition of the existing environmental infrastructure and extrapola-
tion of the situation in the countries who recently joined the EU, total expenditures for fulfilling all the EU
acquis in the field of environment will be around 10.6 billion (from today until 2030). The most demanding
are water sector (5.6 billion), waste (2.8 billion) and industrial pollution sector (1.3 billion). See the fol-
lowing chart.

127
Total expenditure is 1.400 per citizen, slightly more than the average of 1.150 per citizen (in euros
for 2010) that was assessed by the EU for the previous wave of accessing countries. Currently, 0.4% of GDP
is invested in the field of environment, in accordance with assessment given in the National programme for
environmental protection and in the report The needs of the Republic of Serbia for international assistance
in the period from 2011 until 2013. Although real contribution for the environment from GDP of the Re-
public of Serbia is probably much higher, possibly up to 0.9% GDP, precisely due to nonexistent contribu-
tion from the local level, from industrial and private sectors who were not taken into consideration, there is
no evidence to suggest that 0.4% assessment should be changed.
Total approximation expenditures include three components: Capital expenditures (CAPEX), opera-
tional expenditures (OPEX), including expenditures for replacement and maintenance of infrastructural in-
vestments, and expenditures related to the increase in the number of employees (ADMIN), including salaries,
all accompanying dues, setting, training requirements, required technical studies (see chart bellow).

These expenditures have been calculated taking into consideration short-term investments for which
obligations had been assumed (for example implementation of national Waste Management Strategy) and
sequential distribution that prevents OPEX to exceed limits of price affordability. Maximal annual expendi-
tures are between 1.1 and 1.4 billion for the period from 2019 until 2023, according to the methodological
assumption from the strategy that 2019 would be the first year of membership, wherefrom greater participa-
tion of the resources from EU funds in the expenditure structure is expected (see chart bellow).

128
On the other hand, resume of the analysis of Cost Benefit from the application of EU acquis, included
in the National Strategy, suggests that during the period from 2030, benefit from transposition and imple-
mentation will be approximately 2.4 times higher than expenditures.
Financial gap, after deduction of expenditures through payments from users and application of eco-
nomic instruments in accordance with the polluter pays principle, must be covered from combined instru-
ments, primarily from EU grants, IPA funds and structural funds (after assuming full membership).
Remaining resources can include: Resources from international financial and credit institutions; resources
from bilateral donors; investments from the economy sector; investments from the public sector (including
central budget, local government budget and other economic instruments such as earmarked budget funds
etc.). It will be necessary to simultaneously direct state efforts and resources towards improvement of admin-
istrative capacities for integrated financial planning and projecting and set a sustainable, durable, predictable
and continuing mechanism for long-term financing of the environmental protection policy.

2.2.3. Degree and Pace of Trade Integration with the EU


European Union as the most significant trade and economic partner of Serbia, for more than ten years
has a very large share in total trade in goods of Serbia with the world. Trade integration with the EU is in-
creasing year after year, while in 2012, the EU share in total export of Serbia reached 57%. In terms of im-
port, EU also has a large share of 57.4% which is five times higher than the share of Russian Federation16,
second most important trade partner of Serbia.
On the other hand, Serbia does not rank high in terms of trade in goods of the EU with the world and
is only 39th foreign trade partner of the EU17, which is understandable considering the economic strength,
size and capacity of Serbian and European markets.
Formation of free-trade zone between Serbia and the EU will, in accordance to the Interim Trade
Agreement (ITA), will be realized in the 6-year period starting from 2009. On the 1st of January 2012 Serbia
has entered the fourth year of the application of ITA and lowered the customs in accordance to the dynamics
envisioned, this tariff protection for the goods imported from the EU was 1.8% in 201218. In 2013, the proc-
ess of liberalization will be continued, while average tariff protection for products imported from the EU will
be 0.9%. In 2014 all duties will be suspended, excluding certain agricultural products, thus at the end of
transition period Serbia will suspend duties for 95.1% of tariff lines.
The degree of trade integration is best reflected in the movements in trade in goods between Serbia and
the EU. Namely, the trade was increasing until the world economic crisis, which coincides with the beginning
of application of the Interim Trade Agreement. Later, during 2011 and 2012, the trade flows recovered, while
further growth of import is expected in 2013, primarily as a result of automotive industry and agriculture
growth. In addition, it can be observed that Serbia has been better utilizing benefits of the ITA so far since

16
Russian share in total import of Serbia is 12%.
17
The share of Serbia in total EU import is 0.3% (ranked 49) while its share in total EU export is 0.6% (ranked 33).
18
Average tariff rate on MFN basis in 2012 was 8.6%.

129
about 82% of export in the EU in 2012 is preferential export, while, as far as the EU is concerned, share of
preferential import in comparison to total import from the EU is around 60%.
In terms of EU export, Serbia fully utilize the sugar and wine quota, while fish and beef quotas are at a
very high level of utilization of 5%, on the other hand, the EU has export quota only for wine and fully util-
izes it every year.
Serbia records high deficit in exchange in industrial products trade, while in terms of agricultural
products trade, continuous surplus is being achieved for many years from out side amounting to around 500
million on average annual basis. Serbian export to the EU in the first ten months of 2012 was 4.2 billion
(3.4% increase in comparison to the same period of the previous year), while import amounted to 7.1 billion
which represents increase of 5.2%. 2.9 billion deficit has been recorded with the 58.9% coverage of imports
with exports, with main export destinations of Serbia in the EU being Germany, Italy, Romania and
Slovenia, while import was mostly from Germany, Italy, Hungary and Romania.

2.2.4. Restructuring of Enterprises and Significance of Small and Medium


Enterprises
Restructuring, in accordance with the Decree on procedure and manner of restructuring of entities un-
dergoing privatization (Official Gazette of RS, no 52/05, 96/08 and 98/09) is presently conducted in 175 en-
terprises. Pursuant to the latest amendments to the Law on Privatization (Official Gazette of RS no 38/01,
18/03, 45/05, 123/07 - state law, 30/10 - state law and 93/12) protection from liquidation of the entity under-
going restructuring has been limited to 30 June 2014. In accordance with the above mentioned, Privatization
Agency in cooperation with the World Bank prepares action plan which envisions resolution of the status of
these entities by successful finalization of restructuring through privatization, i.e. organization of additional
tenders where possible and/or initiation of bankruptcy proceedings or through another type of resolution. It
is important to emphasize that the Law on Financial Restructuring of Companies by Mutual Consent (Offi-
cial Gazette of RS, no 26/2011) is not applied on companies undergoing privatization.
Serbian economy still suffers the consequences of the world economic crisis, whose effects are only
partially alleviated by economic policy measures, which results in further slowdown of the SMEs economic
activity, which has replaced the dynamic growth from the period before the crisis. In comparison to 2010 and
2011, the growth in the number of companies, as well as SMEs has continued, however the number of newly
established companies decreased while the number of liquidated ones increased. SME sector employment
dropped for additional 3.5%. Gross value added and the profit have also dropped each by 3.2%.
Weakening of business results of the SME sector in the circumstances of the crisis is caused by lower
demand, lower rate of claims recovery, less investments, over-indebtedness, lower credit solvency and lower
liquidity which led to weakening of their position at the market. In these circumstances, structural problems
of the sector fully manifested themselves: Dominant participation of micro and small companies and entre-
preneurs accompanied by low average number of employees per company, focus on the narrow local market,
great dependency on external financing resources; insufficient inclusion in the chains of suppliers and weak
connection with big companies, falling behind in terms of technology, techniques and competitiveness.
MSEs mostly operate in non-tradable industry sectors, while their product are characterized by a low level of
processing, which are key factors limiting their more efficient inclusion in international flows. Besides,
MSE in Serbia are not equally represented on the local level, thus the greatest number of SMEs operates in
Belgrade and South Baka District, while Toplice and Pirot Districts have the smallest number of SMEs.
Despite the negative impacts of the economic crisis, encourages the fact the SMEs managed to achieve
positive results in 2011, thus proving that they are a very endurable and adaptable sector of economy. Enter-
prises and entrepreneurs who overcame the fist impact of the crisis, have become more competitive and ori-
ented towards export, which amounted to 6% in 2011, while coverage of imports with export in SME sector
was higher than 50% for the first time.
Due to the delicate position of SMEs, the government of the Republic of Serbia in cooperation with
the Ministry of Finance and Economy will be decisive in creation of a new economic policy priority of
which will be accelerated development of business environment and entrepreneurship in Serbia.
New economic policy includes fiscal consolidation, adoption of and amendments to the set of law
which will, on one hand, provide macroeconomic and financial stability, and on the other hand, facilitate fast
recovery of Serbian economy and entrepreneurship.

130
The most important measures implemented in 2012 included improvement of business environment by
abolition of more than 130 parafiscal charges, VAT collection reform and liquidity improvement through
adoption of the Law on Payment Deadlines in Commercial Transaction, as well as through subsidized loans
for liquidity.
For more detail on the scheduled activities directed towards improvement and development of SMEs
see Chapter 20: Enterprise and industrial policy.

2.2.5. Influence of the government policy and legislation on competitiveness


Involvement of Serbia in different international programmes for improvement of
competitiveness
Ministry of Finance and Economy participates in Competitiveness and Innovation Framework Pro-
gramme (CIP), Entrepreneurship and Innovation Programme directed towards stimulation of competitiveness
of European companies, primarily SMEs through four types of instruments: 1) financial instruments, 52% of
the budget; 2) business support services (especially informing and connecting small and medium enter-
prises), 17% of the budget; 3) support to initiatives directed towards strengthening of entrepreneurship and
innovation, 25% of the budget and 4) initiatives for improvement of certain policies, 6% of the budget.
Results of the participation of organizations companies and institutions from the Republic of Serbia:
1 Projects co-financed from the programme fund:
- Enterprise Europe Network (EEN);
- The European Network of Female Entrepreneurship Ambassadors WENS;
- Women entrepreneurship mentors in Serbia WEM;
- South-East European Network-of-Excellence of Cluster Organisations (SEENECO);
- Environmental protection service for SMEs;
- Monitoring of implementation of European statute for a cooperative society and associations sat-
ellite accounts for cooperation societies and associations;
- Cultural routes in the region of the middle and lower Danube;
- European destinations of excellence accessibility of tourist destinations;
2 In accordance with the Agreement with European Investment Fund, aanska Bank is giving
loans for SMEs under better conditions, within the scope of CIP financial instruments;
3 Utilization of tools for improvement of innovation and entrepreneurship that are developed
within the scope of the Programme;
4 Participation in European Union's initiatives that are financed from CIP(European SME Week),
as well as the competition for the best idea in the field of entrepreneurship (European Enterprise
Promotion Awards);
5 Financing of our experts' participation in the meetings, fora and conferences directed at identify-
ing obstacles and creating business environment for development of companies (especially
SMEs), exchange of good practices at the level of the EU etc.
Considering that implementation of CIP will be completed in 2013, in accordance with the long term
EU budget period, preparations for inclusion in the new EU programmes COSME and HORIZON 2020
will be initiated.
In 2009 the Law on Competition (Official Gazette of RS, no 51/09) was adopted, which is fully
aligned with the legislation of the European Union. After 3 years from the start of the application of the Law
by the Commission for Protection of Competition, as an independent supervisory body, and competent
courts, it is necessary to reinvestigate the experiences acquired in administrative and court practices. For
more detail, see Chapter 3.8. Competitiveness policy
Decree on application of regulations on state aid on incentives from the Law on Regional Develop-
ment has been adopted and published in the Official Gazette of RS, no 116/12. (Approximation of all state
aid prescribed schemes).
Strategy for Development of Education in Serbia until 2020 sets forth measures that are expected to
improve competitiveness of the economy of the Republic of Serbia, for which deadlines will be set by the
Strategy implementation Action Plan.

131
In terms of secondary education: Development of the mechanism for identification of required qualifi-
cations in local chambers of economy and at the local government level for the period from one to five years;
development of new network of secondary education schools in accordance with the market demand and
demographic movements in the region and local environment; establishment of at least five regional techno-
logical centres for specific sectors by using economic capacities and existing school facilities and student
housing facilities; by adoption of regulations on the operation of regional technological centres, manner for
their financing, work of teachers/instructors in these centres as well as "guest teachers; verification of all
vocational schools of secondary education; harmonization of curricula with the data on the unemployed at
the labour market and economical and technological needs of the state and the region.
In terms of higher education: Harmonization of study programmes with the needs of economy, as well
as cooperation on realization of professional practice for students so that they would acquire more knowl-
edge, skills and competences relevant to the needs of the employers; additional formal and informal educa-
tion of the employees in order to be able to respond to the new requirements of their respective professions
or future professions; engagement of prominent experts in the instruction at institutions for higher education,
not only as guest faculty, but also as external faculty; mutual work on innovative projects realized at innova-
tion centres of institutions for higher education with involvement of students and experts from companies,
with a view to realize ideas that can lead to innovation development, mutual applied and development re-
search which properly engage the resources of the university (additional education, research activities, com-
mon laboratories, engagement of teachers and students etc); provision of conditions that will enable each
university to establish at least one business incubator in order to support entrepreneurial activities of their
alumni thus contributing to establishment of a new industry based on scientific knowledge. Priorities in 2013
(see chapter 3.26.1)

2.2.6. Sectoral reforms directed at increasing productivity and


competitiveness
The government will assume responsibility for natural resources of the country and will provide
proper investments in agriculture, mining, energy, traffic and telecommunication infrastructure. With a view
to change economic structure, active industrial and other sectoral policies will be implemented.
Active industrial policy will be implemented in order to increase competitiveness and export of the in-
dustrial sector as a condition for a higher growth rate and increase in the share of tradable goods. For this
purpose, proper support for export of sophisticated metal, automotive, electronic, food, pharmaceutical and
weapon industry products, primarily, through attraction of foreign investments will be provided. Finalization
of restructuring of major industrial systems and more efficient bankruptcy procedure will significantly con-
tribute to this. Special support will be provided for the industry development projects that give the biggest
contribution to the current account balance, engage advanced technologies and trained workforce, have high
added value, involve a great number of small and medium enterprises in the production chain and contribute
to the increase in the number of employees. In order to alleviate the impact of the second wave of the world
economic crisis, especially the crisis in Euro zone, at the economy of Serbia and create conditions for eco-
nomic recovery, the plan of anti-crisis measures for economy has been adopted. The key measure is subsidi-
zation of interest rates for the loans for liquidity of the economy and residential housing. Besides that,
important measures for stimulation and facilitation of the economy include shortening of deadlines for re-
covery of claims from the Republic, local governments and public entities, abolition of redundant parafiscal
charges and fees for companies, as well as redundant agencies and funds. In the conditions of the crisis, the
state will intervene in a proper manner in order to stimulate production and attract investments, especially in
the regions with high unemployment rates. Grants and subsidized loans will be given to small and medium
enterprises, starting from the entrepreneurs dealing with various crafts to entrepreneurs dealing with informa-
tion technologies and export of services.
By amendments to proper regulations 138 parafiscal charges have been abolished, out of which 22
represent local government incomes. By amendments to the Law on Fiscal Registers the obligation of using
fiscal register was cancelled for lump-sum entrepreneurs who sell their own products within their production
activity i.e. provide services for natural persons. Small and medium enterprises had the most benefits in
terms of savings: Charge for the business name display, the so called "firmarina was abolished.
Real sector has been significantly restructured and privatized in the previous transition period, while
the remaining private sectored development reforms will be directed to:

132
- Completion of the privatization of public entities and more efficient enforcement of bankruptcy
proceedings for unsuccessful entities;
- Acceleration of the process of public entities restructuring and continuation of their preparation for
privatization (majority or minority);
- Liberalization of infrastructural activities;
- Better protection of competition;
- Stimulation of export;
- Stimulation of development of small and medium enterprises.
Based on the global competitiveness index, the Republic of Serbia has in 2012-2013 ranked at position
95. Such a low level of competitiveness has initiated formulation of measures adopted by the government on
a proposal from National Competitiveness Council of the Republic of Serbia. Measures have been divided in
segments that include:
- Field of infrastructure (building permits, spatial planning, communal fees, improvement of rail
transport etc.);
- Field of energy efficiency (more rational consumption of energy, renewable energy resources, price
parity of the energy resources etc.);
- Field of the goods market efficiency (reform of regulations, protection of competition etc.);
- Field of efficient labour market, development of human resources and innovations (scientific and
research work, technological parks etc.);
- Field of improvement of public administration efficiency (adoption of more efficient regulations
within various competences of the public administration).
In order to increase competitiveness of the economy, the Ministry of Finance and Economy undertakes
measures directed towards establishment of normative and institutional basis for approximation of Serbian
technical regulations with the European legislation and practices, as well as activities directed towards im-
provement of work of national standardization, accreditation and metrology authorities. Efforts of the qual-
ity infrastructure sector are directed towards development of the network of bodies for assessment of product
compliance the requirements of technical regulations, and enabling economy for implementation of harmo-
nized technical regulations in order to create economic environment suitable for integration into European
and world economies.
The objective of establishment of quality infrastructure institutions in the country oriented towards the
EU accession, is above membership of these national quality infrastructure institutions in proper European
institution which will enable mutual recognition of the product testing results and certificates that facilitate
marketing of products of Serbian companies at the EU market, and guarantees them equal rights at the mar-
ket.
In order to improve competitiveness of Serbian economy, it is necessary to further support all the
mechanisms of mutual recognition and recognition of product testing results and certifies issued in Serbia,
such as signing the Contract on mutual recognition (bilateral and multilateral), membership in international
bodies for compliance assessment etc.
For more information, see chapter 1: Movement of goods.

133
3. ABILITY TO ASSUME THE OBLIGATIONS OF EU
MEMBERSHIP

3.1. Free movement of goods


3.1.1 Horizontal issues
Overview
Ministry of Finance and Economy (hereinafter: MFE) is responsible for all horizontal issues in the
field of free movement of goods. The coordinating role in the field of technical regulations and quality infra-
structure (standardisation, accreditation, metrology and conformity assessment) arises out of Article 4 of the
Law on Ministries (Official Gazette of RS, No 72/12).
The horizontal legal framework in this area was established by passing four systemic laws in the pe-
riod from 2008 to 2010, and by the adoption of by-laws for their implementation, which was completed in
2012.
The Law onTechnical Requirements for Products and Conformity Assesment (Official Gazette of RS,
No 36/09) represents the basis for the transposition of European directives, if prescribing product technical
requirements and implementation of conformity assessment procedures is not stipulated by special laws, but
also allows the stipulation of technical requirements in areas where there are no harmonised rules at EU
level.
In the case where for some of the products there are no technical requirements stipulated on the above
grounds as regards safety of products on the market and during the use, the Law on General Product Safety
shall be enforced (Official Gazette of RS, No 41/09). This law is essentially harmonised with the basic re-
quirements of Directive 2001/95/EC on general product safety and completely transposes the requirements of
Directive 87/357/EEC on dangerous products resembling foodstuffs .
With the entry into force of the Law on Standardisation (Official Gazette of RS, No 36/09) conditions
for faster and more efficient adoption of European standards were provided, and the requirements for full
membership in the European standardisation organizations were met. On the basis of the Law on Standardi-
sation, the transformation of Institute for Standardisation of Serbia was executed (hereinafter: ISS). In accor-
dance with the amendments to the ISS constituent instrument in January 2010, it acquired the status of a
public institution. As until the end of 2012 the ISS had met its objective and obligation, with respect to trans-
posing at least 80% of European standards, i.e. more than 85% of European standards were transposed, the
conditions for the ISS to perform other tasks not related solely to the adoption of standards were created.
The basic horizontal framework for organizing the metrology system in the Republic of Serbia is the
Law on Metrology (Official Gazette of RS, No 30/10). During the drafting of this law, the documents of the
International Organization of Legal Metrology (International Organization of Legal Metrology - OIML D1
and OIML D9) and EU regulations relating to metrology were taken into account. The process of harmonisa-
tion of horizontal legislation in the field of metrology was completed by adopting the Rulebook on the
method of determining the competence for appointment of conformity assessment bodies, at the end of 2012.
The Law on Accreditation (Official Gazette of RS, No 73/10), which was adopted to comply with
Regulation (EC) 765/2008, entered into force in October 2010. The accreditation system is thus harmonised
with the rules of Regulation (EC) 765/2008 as well as the requirements of ISO IEC 17011 - General re-
quirements for accreditation bodies accrediting the conformity assessment bodies. By the Law on Accredita-
tion, the Accreditation Body of Serbia (hereinafter: ATS) was established as a public institution.
The above 4 systemic laws, with by-laws, transpose all European principles in the horizontal sense,
because the new reference solutions of EU legal acts relating to the trading of goods were taken into account
during their drafting, that is Decisions 768/2008/EC, Regulations 765/2008/EC and Regulations
764/2008/EC (the so-called new goods package).
Administrative capacities
In order to efficiently perform the tasks related to the strategy and policy development in the field of
free movement of goods, as well as the obligations under Article 77 of the Stabilisation and Association
Agreement, in the mid-2008, within the Ministry of Finance and Economy a Quality Infrastructure Depart-
ment was established employing currently 23 persons.

135
Measures to implement the priorities in 2013
During 2013 an intensive work on drafting the Strategy for the improvement of quality infrastructure
in the Republic of Serbia is planned (hereinafter: QI Strategy), so that this long-term strategic document be
adopted in 2014. The aim of the Strategy is to set priorities for the future development in this area, in accor-
dance with the needs of industry and a new legal framework. Thus one of the recommendations of the An-
nual Progress Report of Republic of Serbia in the process of European integrations in 2012 will be fulfilled.
In the same year the preparatory activities on the revision of the Law on Standardisation and the Law
on Metrology will start (detailed in the next chapter).
Measures planned for the period 2014-2016
The adoption of QI Strategy, which according to the plan is to be adopted in 2014, will define the next
steps for a balanced development of all components of quality infrastructure: standardisation, metrology, ac-
creditation and conformity assessment.
From 2014 to 2016 amendments to the Law on Standardisation and the Law on Metrology or the revi-
sion of by-laws to ensure full compliance with the latest European legislation are planned. Amendments to
the law on standardisation are made to comply with the new Regulation (EC) 1025/2012, which will allow
the ISS to be positively evaluated by the European organizations for Standardisation (CEN and CENELEC)
and admitted as a full member of the European organizations. In addition, the review of the law on standardi-
sation will enable ISS to perform additional activities which will increase the ISS's own income.
Simultaneously with the harmonisation of regulations for product safety with European harmonised
legislation (which will, in 2014 and 2015, be in its final phase), one of the medium-term priorities is prepar-
ing and implementing a plan for adjustment of the non-harmonised area, aiming at compliance assessment of
Serbian technical regulations, in areas that are not harmonised at the EU level, with the provisions of Art. 34-
36 of the Treaty establishing the EU.
Review of current and planned foreign development aid
1. With the support of a bilateral programme ACCESS - Assistance to the Competitiveness and Compati-
bility for the EU of Serbian SME, the German Organization for International Cooperation - GTZ (Deutsche
Gesellschaft fr Internationale Zusammenarbeit) the QI Strategy is being prepared. Part of this program is
implemented as a technical support for the capacity building of quality infrastructure institutions, espe-
cially the Directorate of Measures and Precious Metals, the Accreditation Body of Serbia and the Institute
for Standardisation of Serbia.
2. In order to facilitate regional trade and the free movement of goods in the CEFTA region and Western
Balkans, as well as to prepare for the membership of these countries in the EU, a project "Quality infra-
structure in the Western Balkans region and Turkey is being implemented. This project is being imple-
mented from August 2011 to February 2014, and funded by the Multi-beneficiary IPA 2011. The total
value of the project is 2.65 million EUR. The main activities of the project are:
- Progress assessment of the quality infrastructure institutions in the countries of the region;
- Regional schemes for testing technical competence of laboratories in priority fields of economies of
countries in the region (proficiency testing);
- Training in the field of quality infrastructure (standardisation, accreditation, metrology, conformity
assessment, market surveillance and others);
- Strengthening of the regional cooperation in the field of quality infrastructure (networking).
3. The IPA 2010 project Strengthening Serbian system of market surveillance for food and non-food
products is being implemented in order to reduce consumer exposure in Serbia to unsafe products, by im-
proving market surveillance system. The main beneficiary of the project is the Ministry of Foreign and In-
ternal Trade and Telecommunications, and the value of the project is 2.85 million EUR. In addition to the
strengthening of market surveillance, the project will support the ministries in charge of technical require-
ments for industrial products for transposing 5 European directives.
4. The preparation of the Programme of strengthening the business environment, infrastructure and inno-
vation, IPA 2013, is underway, within which the measure Support for the industry development by capac-
ity building of authorities responsible for quality infrastructure and the service providers of conformity
assessment has the ultimate goal to improve the competitiveness of Serbian industry in the EU market.
This measure provides two operations: procurement of equipment for conformity assessment bodies (esti-

136
mated value of 5 million EUR and technical support (estimated value of EUR 1 million) to institutions of
quality infrastructure, conformity assessment bodies and enterprises, for complete implementation of har-
monised technical regulations.

3.1.1.1. Standardisation
Overview
The legal basis for adopting Serbian standards and related documents is contained in Article 6 of the
Law on Standardisation (Official Gazette of RS, 36/09). In preparing the annual ISS work programs and an-
nual plans for making Serbian standards and related documents, primary the priorities arising from the acces-
sion of the Republic of Serbia (RS), the World Trade Organization (WTO) and the Stabilization and
Association Agreement (SAA) establishing the obligations to be fulfilled by RS before joining the European
Union (EU), are taken into account. The full membership of ISS in the European Committee for Standardisa-
tion (CEN) and the European Committee for Electrotechnical Standardisation (CENELEC) is one of the con-
ditions that must be fulfilled by RS for EU accession. One of the main and most difficult conditions for
acquiring the status of a full member in these organizations is transposing 80% of European standards and
harmonising documents19 into Serbian standardisation. From 2007 to 2012 the ISS has been working inten-
sively to fulfil this requirement. At the same time, ISS withdrew almost all Serbian previously published
standards that were inconsistent with the transposed European standards, or simply outdated and irrelevant.
The dynamics of transposing the European standards and related documents, as well as the withdrawal of
Serbian standards published in the mentioned period is shown in Table 1.
Until 31 December 2012, approximately 88% of European standards and harmonising documents has
been transposed as Serbian standards by ISS, for which the deadline for publication at the national level had
expired to that date.
Table 1 - Summary of published Serbian standards and related documents by year,
language and document with which they are identical, and the number of withdrawn
standards per year, in the period from 1/1/2007 to 31/12/2012
Number of published Serbian Number of published Serbian standards iden- Number of
standards and relevant documents tical with European standards (SRPS EN) withdrawn
Year
Serbian English lan- Serbian stan-
Total CEN CENELEC ETSI Total dards
language guage
2007. 65 393 458 274 11 0 285 128
2008. 512 2314 2826 1990 613 0 2603 344
2009. 252 3257 3509 2312 1136 4 3452 386
2010. 284 3496 3780 2161 1513 0 3674 609
2011. 226 4127 4353 2797 1310 7 4114 1308
2012. 206 5020 5226 3714 1010 275 4999 6371
Total: 1545 18607 20152 13248 5593 286 19127 9146
Administrative capacities
In 2012 there were 64 employees in ISS. In 2013 it is foreseen to increase that number by two em-
ployees (the total of 66 employees), which is the optimum for effective and efficient performance.
Measures to implement the priorities in 2013
In 2013 the ISS plans to complete the transposition of all the remaining European standards and to
continue activities on the transposition of European standards performed in a synchronized way with the ac-
tivities of European standardisation organizations. In other words, each newly published European standard
should be transposed as Serbian, within the deadline which applies to all countries that are full members of
CEN and CENELEC, or the EU. That deadline is usually six months.
The plan of setting out standards and related documents for 2013 includes work on a total of 2.302
projects of Serbian standards and related documents (1.635 from the general area of standardisation and 667
from the electrical field of standardisation). Of these, 259 projects are scheduled for publication in the Ser-
bian language, while the other 2.043 will be published in English. The number of so-called harmonised stan-
dards, or standards that are used to meet the requirements of technical regulations planned to be worked on in

19
These documents are published by CENELEC, and they have the same status as European standards.

137
2013 is 491.Since some of the projects which have been started in 2012 will be implemented in 2013, the
total number of standards and related documents that ISS will publish in 2013 is 2.849, out of which 369 are
in Serbian and 2.480 in English. Of these, 2.068 will be in compliance with European standards and related
documents, 738 with international standards and related documents (663 with ISO, 7 with IEC, 26 with
ISO/IEC, 16 with ISO/TS, 11 with ISO/TR, 6 with ASTM and 9 with UNECE), and it is planned to adopt 43
original Serbian standards, as a result of the review in 2012 and after deciding on the revision and/or modifi-
cation of the existing publications.
Given that ISS in 2012 met the requirement for full membership in the European standardisation or-
ganizations CEN and CENELEC concerning the transposition of European standards and harmonising docu-
ments into the national standardisation, for the first half of 2013 an intensive work is planned on the
preparation and translation of the documents necessary for filing an application for full membership, as well
as the submission of the application in May 2013 (if the founder of ISS agrees with that and assumes the cor-
responding obligations). In addition, special attention will be paid to the harmonisation of the existing inter-
nal rules of standardisation with the criteria that must be met by all full members of the European
standardisation organizations as of 1/1/2012, in order to create an adequate basis for equal participation of
ISS in European standardisation.
In addition, the ISS plans to work more intensively on promoting the importance of standardisation
and application of standards, and the education of all stakeholders in the process of setting standards at na-
tional as well as at European and international level.
In October 2012 the European Parliament and the Council of the European Union adopted a new
Regulation on European Standardisation (No 1025/2012), which, among other things, establishes guidelines
for the national standardisation bodies. Therefore, one of the most important activities in 2013 will be re-
viewing and possible changes in regulations that define the activity and operation of ISS, in order to bring
them into line with this regulation.
Measures planned for the period 2014-2016
The overall objective of ISS is to establish an effective and efficient system of national standardisation
which will lastingly enable that in a reasonable time the needs of founders and members of ISS and all other
stakeholders are successfully fulfilled, as well as to create the necessary conditions for an early accession of
RS to the EU, which is at the same time the ultimate goal of the state strategy.
In the period 2014 - 2016, the ISS strategy will be focused on achieving the following strategic objec-
tives:
1. Retaining the status of a full member of international and European organizations for standardisation,
as well as active participation in the creation and implementation of policies and strategies of the or-
ganization;
2. Establishing a stable source of funds in the budget of RS for the regular funding of intensive translation
of transposed European standards from English into Serbian in order to facilitate their application to
the users of standards in RS (and primarily the standards that are required to meet technical regula-
tions) and to ensure a sustainable system of selection, and the translation of the most needed newly
published European standards;
3. Further improvement and intensification of the activities regarding information and publishing and
promotion and education within legally defined ISS activities;
4. Expansion of activities of ISS with new activities and jobs, with appropriate changes in the applicable
law on standardisation and regulations;
4. Continuous development and improvement of ISS information resources to allow smooth exchange of
documents with European and international standardisation organizations, enhanced communication
with all stakeholders and to raise the quality of ISS publications and services to a higher level;
6. Continuous promotion of the importance of standardization and the effects of application of standards,
as well as the education of all stakeholders for their more equitable and effective participation in the
standards-making process at national, European and international levels, with a particular emphasis
on the involvement of as many as possible small and medium-sized enterprises;
7. Larger and more active participation of ISS representatives and other stakeholders in RS in the work of
European and international technical committees in the field of standardisation, which are of particu-
lar national interest;

138
8. Continuous training of ISS employees so that they in the best possible way fulfil the obligations which
the ISS will have as a full member of the European standardisation organizations;
9. Continuous improvement of internal processes and procedures, including the possible re-engineering of
business processes, in order to increase the effectiveness and efficiency of ISS performance;
10. Increase by half the present number of ISS members (88).

3.1.1.2 Accreditation
Overview
The position and work of the national accreditation body in the Republic of Serbia, as well as other is-
sues of importance for accreditation are regulated by the Law on Accreditation (Official Gazette, No
73/2010), the Statute of the Accreditation Body of Serbia (Official Gazette of RS, No 97/2011) and by Deci-
sion on amending the Constituting act of the Accreditation Body of Serbia (Official Gazette of RS, No
14/11).
The Accreditation Body of Serbia (ATS) on 24/5/2012 became a full member of the European organi-
zation for accreditation (EA) when a decision was made to sign a multilateral agreement (EA MLA) on the
recognition of accreditation for the following areas of accreditation: testing laboratories, medical laborato-
ries, calibration laboratories, inspection bodies and certification bodies for certification of products.
The Multilateral Agreement (MLA EA) is signed based on results of a detailed peer evaluation (peer
evaluation) by EA. This type of evaluation, pursuant to Regulation (EC) No 765/2008 of the European Par-
liament and the Council, operates on the basis of reliable and transparent criteria and evaluation processes.
Signing this agreement confirms the equivalence of the accreditation system which is implemented in the
Republic of Serbia with accreditation systems in the EU member states and creates the presumption that na-
tional authorities accept certificates of accreditation of these accreditation bodies and the documents issued
by conformity assessment bodies accredited by them.
Besides, the ATS on 15/5/2009 became an associate member of the International Laboratory Accredi-
tation Cooperation - ILAC and since 24/5/2012 it has been a full member of ILAC and a signatory to the
ILAC MRA Agreement (Mutual Recognition Agreement) for the field of testing and calibration (24/05/2012).
On 24/10/2012 the ILAC MRA agreement in the field of control was signed. Since 29/12/2011 the ATS has
become a member of the International Accreditation Forum - IAF by signing a Memorandum of Understand-
ing between the ATS and the IAF, that is, the ATS on 25/10/2012 also signed the IAF MLA (Multilateral
Agreement) agreement in the field of product certification.
So far the ATS has accredited: 102 control bodies, 14 certification bodies for certification of products,
8 certification bodies for management system certification, 55 calibration laboratories, 8 medical laboratories
and 298 testing laboratories.
Completed in 2012:
- Preparation of Strategic objectives 2012-2017 and drafting or modification of ATS management
system documents for their full harmonisation with European and international organizations in the
field of accreditation - EA, ILAC and IAF;
Administrative capacities
Human Resources of the ATS include: full-time personnel (total of 35) and externally hired assessors
and technical experts. The ATS has 105 assessors for all types of accreditations and 101 technical experts.
In the process of appointing to the status of assessors there are currently 85 candidates.
Also, for the process of deciding on accreditation, the ATS hires 82 experts in various fields of con-
formity assessment to participate in the work of the Commissions for making decisions on accreditation.
In accordance with the Statute, the Management Board of ATS deciding on the operations of the ATS,
lays down the work policy, monitors its implementation and has 5 members.
Within the ATS, the Accreditation Council as an advisory body and/or permanent technical commit-
tees as expert bodies have been founded. The Accreditation Council provides expert opinions regarding de-
velopment of the accreditation system, gives the initiative to expand the area of activity of ATS, gives an
opinion on the application of standards required for accreditation in certain areas, proposes the establishment
of permanent and temporary committees as technical working groups for specific areas of accreditation and
takes positions to other professional matters. The Accreditation Council has appointed 11 individuals who
represent the stakeholders.

139
Besides the Accreditation Council, permanent technical committees for certain types of accreditation
have been formed (Technical Committee for laboratories within which there are three temporary technical
committees, a technical committee for control bodies and a technical committee for certification bodies with
three temporary technical committees). The tasks of the technical committees are: the interpretation of re-
quirements and documents of international organizations in different types and areas of conformity assess-
ment and accreditation, the consideration of EA, ILAC / IAF document proposals, providing assistance to
ATS in the expansion of business activities, participation in establishing criteria for the competency of asses-
sors in certain areas of conformity assessment, the identification of potential assessors and providing assis-
tance to ATS in the recognition of inter-laboratory comparisons and PT schemes.
Measures to implement the priorities in 2013
- Upon signing the EA MLA agreement the priority is to maintain and expand its scope (during the
regular assessment scheduled for September 2013) so that the agreement is signed both for the field
of management system certification and the certification of persons;
- Cooperation with technical assistance projects financed by the EU (Strategy for the Development
of Quality Infrastructure GIZ / ACCESS, Quality Infrastructure in the Western Balkans and Tur-
key, a regional IPA 2011 project).
Measures planned for the period 2014-2016
- Maintenance of signed multilateral agreements with European and international bodies for accredi-
tation,
- Implementation of New Approach Directives transposed into the legislation of Republic of Serbia
(rulebooks) and other EU legislation, which consequently implies the development of new accredi-
tation schemes,
- Increase of the ATS staff and externally engaged assessors competency.

3.1.1.3. Conformity assessment


Overview
In accordance with the Law on Technical Requirements for Products and Assessment of Conformity,
the technical requirements and procedures for product conformity assessment with the requirements are pre-
scribed by the relevant ministries, in accordance with their area of activity. In late 2009 the by-laws20 were
adopted that regulate the conformity assessment in detail, when the appointment of conformity assessment
bodies started, in accordance with this law, and/or the new technical regulations.
Conformity assessment procedures laid down by the Regulation on carrying out conformity assess-
ment activities are harmonised with the modules defined in Decision on a common framework for the trading
of goods No 768/2008/C).
Administrative capacities
In the Ministry of Finance and Economy, the Quality Infrastructure Department, a separate organiza-
tional unit is responsible for matters of conformity assessment, having three employees. The Ministry has
formed a committee for the appointment of conformity assessment bodies under its authority, in accordance
with the technical regulations whereby European New Approach Directives were assumed. The work of

20
By-laws of the Law on Technical Requirements for Products and Conformity Assessment, which more closely regu-
late matters of conformity assessment are:
1. Regulation on the implementation of conformity assessment, the content of the document of conformity, as
well as the shape, appearance and content of the conformity sign (Official Gazette of RS, No 98/09);
2. Regulation on the appointment and accreditation of conformity assessment bodies (Official Gazette of RS, No
98/09);
3. Regulation on the method of recognition of foreign documents and conformity signs (Official Gazette of RS,
No 98/09).
4. Rulebook on the method of placing conformity signs on products, as well as the use of conformity signs (Offi-
cial Gazette of RS, No 25/10).
5. Regulation on the application procedure and method of notification relating to technical regulations, standards
and conformity assessment (Official Gazette of RS, No 45/10).

140
commissions is coordinated by the mentioned organizational unit. In the commissions, in addition to the em-
ployees of MFE, experts from ATS, ISS and experts outside the Ministry participate if necessary.
It is necessary to further educate and improve human resources within all ministries that adopt and en-
force technical regulations, especially in the part relating to the appointment/authorisation and recognition of
foreign certificates of conformity issued by foreign conformity assessment bodies.
A total of 15 bodies have been designated to conduct conformity assessment in accordance with regu-
lations harmonised with EU directives, in the fields of machinery, low voltage electrical equipment, electro-
magnetic compatibility, lifts, vessels and pressure equipment and telecommunication terminal equipment.
Measures planned for the period 2014-2016
Continuous surveillance of designated conformity assessment bodies will be further improved, trained
and developed, in order to be prepared for the full implementation of European Union regulations.
The priorities of development and improvement of conformity assessment in Serbia will be closer de-
termined and based on the Development Strategy of quality infrastructure, in which the condition of the ex-
isting network of conformity assessment bodies and their willingness to respond to demands of the Serbian
economy is being analyzed.
The Ministry of Finance and Economy will, after full harmonisation of technical regulations in spe-
cific industrial Departments, analyze the possibilities to initiate and coordinate activities related to signing
the ACAA21 agreement, which will enable Serbia to become part of the internal market before full member-
ship in the EU.
Review of current and planned foreign development aid
In order to improve the capacity of conformity assessment bodies, in terms of staff training and provi-
sion of equipment, a project proposal is being prepared which would be financed through IPA 2013 Sup-
port to Industry development through strengthening capacities of authorities in charge of NQI and providers
of conformity assessment (CA) services within the Programme of strengthening the business environment,
infrastructure and innovation. It is expected that the project will be approved during 2013.

3.1.1.4. Metrology
Overview
The metrology system in Serbia is modelled in accordance with international and European trends and
it includes the following entities: The Ministry responsible for metrology - MFE; Directorate of Measures
and Precious Metals (hereinafter: DMPM); Metrology Council; designated conformity assessment bodies,
authorized bodies for the certification of standards and accredited calibration laboratories.
MFE is responsible for the creation of strategies and policies in the field of metrology, and the Direc-
torate of Measures and Precious Metals for their implementation. DMPM, as the National metrological insti-
tution, is a public authority within the MFE that enables the implementation of competencies prescribed by
the Law on Metrology. DMPM performs professional work in the field of scientific metrology, legal metrol-
ogy (which primarily includes conformity assessment of criteria with metrological requirements, e.g. re-
quirements stipulated in the MID and NAWI directives and/or type approval and criteria certification for
criteria for which there is no authorized body, pre-testing of packaged products, metrological supervision,
etc.) and simultaneously has the role of the National Institute of Metrology.
Serbia is a member of the Metre Convention, the International Organization of Legal Metrology
(OIML), the European Association of National Metrology Institutes (EURAMET) and an associate member
of the European Cooperation in Legal Metrology (WELMEC).
Priorities for 2013 with regard to harmonisation of legislation
Adoption and implementation:
- Rulebook on criteria whereby Directive 2004/22/EC on measuring instruments (Measuring Instru-
ments Directive MID) and Directive 2009/137/EC will be transposed;

21
ACAA Agreement on Conformity Assessment and Acceptance of Industrial Products, which is signed with the EU to
ensure free movement of goods for certain product groups.

141
- Rulebook on non-automatic weighing instruments whereby Directive 2009/23/EC relating to non-
automatic weighting instruments (Non-Automatic Weighting Instruments - NAWI) will be trans-
posed, and
- Rulebook on pre-packed products, whereby directives relating to pre-packaged products
76/211/EEC, 75/107/EEC and 2007/45/EC will be transposed.
These Rulebooks will be in full compliance with the specified directives.
Administrative capacities
In the Directorate for Measures and Precious Metals there is a total of 117 posts, but 126 posts are sys-
tematized. Of the total number of employees, 35 employees work in smaller internal units for the area of Ni,
Kruevac, Novi Sad, Zrenjanin and Subotica. In the working groups for transposition of EU directives, with
representatives of MFE - Quality Infrastructure Department, from 5% to 10% of employees are engaged.
The capacities of Directorate for Measures and Precious Metals will be strengthened in preparation for
future performance of the function of a notified body (Notified body) for those criteria for which there is an
interest of the economy.
Measures planned for the period 2014-2016
It is planned to adopt the Law amending the Law on Metrology, which will be prepared during 2013.
The Draft Law amending the Law on Metrology is provided primarily to improve conditions for complete
transposition of European directives and their efficient implementation by improving the metrology supervi-
sion.
Afterwards, it will be worked on the preparation and adoption of certain by-laws for the sake of har-
monisation with the Law amending the Law on Metrology (2014), and the adoption of the Rulebook on aero-
sols (2015), whereby EU Directives 75/324/EEC and 94/1/EC will be transposed.
In addition to training and technical assistance implemented through EU projects (national and re-
gional), in the previous period the Directorate, with the help of equipment procured under the CARDS pro-
gram, has improved its laboratories, i.e. calibration and measurement capabilities in the Republic of Serbia.
In order to further improve its capacity, DMPM is preparing a project proposal, which would be financed
through IPA 2013, which provides for the strengthening of DMPM laboratories and prepares for the full im-
plementation of harmonised European legislation in the field of metrology.
Review of current and planned foreign development aid
In addition to training and technical assistance implemented through EU projects (national and re-
gional), in the previous period, with the help of equipment procured under the CARDS program, the Direc-
torate improved its laboratories, or calibration and measurement capabilities in the Republic of Serbia.
In order to further improve its capacity, DMPM is preparing a project proposal, which would be fi-
nanced through IPA 2013, which provides for the strengthening of DMPM laboratories and prepares for the
full implementation of harmonised European legislation in the field of metrology.

3.1.1.5. Market surveillance Product safety


Overview
In early September 2010, the Government adopted the Market Surveillance Strategy (Official Gazette,
No 68/10), which laid down the basic directions of further development in this area. The Market Surveillance
Strategy requires a new approach in implementing market surveillance activities in the Republic of Serbia
and lays down the obligation of the authorities to, in the period of implementation of the strategy, take the
responsibility for the application of principles that make market surveillance effective to contribute to fair
competition in the market, consumer protection and protection of other aspects of public interest. Among
other things, this strategy is binding the market surveillance authorities to apply risk assessment methods
aimed at unsafe products, services and practices with serious and intentional irregularities using coordinated
approach. The market surveillance authorities are expected to take measures in cooperation with other en-
forcement measures authorities and that there is directing of operational programs and measures. In this way
there is tendency to adopt a unified approach to the application of the same measures for the same infringe-
ments against those who make the violations. There is a tendency to reduce the number of controls and to
increase the results gained. In this respect, cooperation was established between the Market Inspection, Sani-
tary inspection, Environmental Protection Inspection, as well as between the Market Inspection, the Customs

142
Administration and the MFE Quality Infrastructure Department, which is based on a protocol on cooperation
and which is further developed through the implementation of common activities in the project to strengthen
the market surveillance system of Serbia.
One of the key tasks based on the Market Surveillance Strategy, is adopting the Law on Market Sur-
veillance in order to fully apply the EU principles in the field of market surveillance and fuller harmonisation
with Regulation (EC) 765/2008 of the European Parliament and of the Council of 9/7/2008, which is setting
out requirements for accreditation and market surveillance relating to the trade of products and repealing
Regulation (EEC) 339/93.
The National Assembly of the Republic of Serbia on 6/12/2011 adopted the Law on Market Surveil-
lance (Official Gazette, No 92/11). The law regulates the implementation of activities and takes measures of
market surveillance within the field of activity of market surveillance authorities, regulating cooperation be-
tween market surveillance and customs authorities, the exchange of information and communication with
stakeholders, planning and market surveillance activities. This law is the basis for constitution of the Prod-
uct Safety Council that aims to improve the coordination of market surveillance for non-food products.
Priorities for 2013 with regard to harmonisation of legislation
In order to elucidate the relationship between General Product Safety Directive 2001/95/EC and De-
partmental regulations, in 2013 there will be a detailed analysis of the Law on General Product Safety with
recommendations for further harmonisation with EU law.
Within regional cooperation in the field of market surveillance, the analysis of sampling procedure for
testing the compliance of products with harmonised technical regulations has begun.
Administrative capacities
Market Inspection Department has 477 employees (100 of them are market inspectors responsible for
controlling the application of technical regulations), and as one of internal organizational unit of the Ministry
of Foreign and Internal Trade and Telecommunications, it performs activities and takes measures of market
surveillance. The Market Inspection Department is a coordinator in the system for exchange of information
on dangerous products, which was established by the Law on General Product Safety and by-laws for im-
plementation of the mantioned law22.
Measures planned for the period 2014-2016
Recommendations based on the Analysis of the Law on General Product Safety for further harmonisa-
tion with EU regulations will be carried out.
The information system that supports the operation of market surveillance will be implemented and
the IT infrastructure, including systems for the rapid exchange of information on dangerous products-
RAPEX, will be further developed.
An Instruction on how to use a database of market surveillance of authorities involved in the system of
rapid exchange of information on dangerous products and the maintenance of information support system
will be completed and adopted, as stipulated by Article 15 Paragraph 5 of the Law on Market Surveillance
(Official Gazette of RS, No 92/11).
Review of current and planned foreign development aid
With the help of IPA 2010 project Strengthening of the Serbian system of market surveillance for
non-food and food products, which began on 16/7/2012 and will run until 16/7/2014, the Council for Prod-
uct Safety will be constituted and start work in 2013-2014. The total budget of the project is 2.85 million
EUR. In addition to supporting the transposition of EU legislation on product safety, the key activities of the
project are directed towards development of the information system that supports the work of market surveil-
lance (information management system) and education of market inspectors, sanitary inspectors, representa-
tives of the Customs Administration and the quality infrastructure authorities in the field of application of
technical legislation in accordance with the principles of market surveillance and best practices of EU mem-
ber states.

22
Regulation on the Establishment and Operation of the system of rapid exchange of information on dangerous prod-
ucts (Official Gazette of RS, No 89/09) Rulebook on the form and content of notifications of dangerous products (Offi-
cial Gazette of RS, No 112/09).

143
3.1.2 Old Approach Directives

3.1.2.1. Motor vehicles


Overview
- Law on Road Traffic Safety (Official Gazette of RS, No 41/09 53/10)
- Law on International Road Transport (Official Journal of FRY, No 6/98, 5/99-corrigendum, 44/99,
74/99 4/2000-corrigendum Official Gazette of RS, No 101/2005, 101/2005- state law and
18/2010)
- Regulation on the Ratification of Agreement on the acceptance of uniform conditions of approval
and the reciprocal recognition of approvals of equipment and parts of motor vehicles (Official
Journal of FPRY, No 5/62 - international agreements).
- Law on the Ratification of the International Agreement on the adoption of uniform technical pre-
scriptions for wheeled vehicles, equipment and parts which can be fitted and/or used in wheeled
vehicles and the conditions for reciprocal recognition of approvals granted on the basis of these
new prescriptions (Official Gazette of RS, No 11/2011 - international agreements).
- Rulebook on the division of motor vehicles and trailers, and technical requirements for vehicles in
road traffic (Official Gazette of RS, No 64/10 and 69/10);
- Decision on designation of goods the the import, export or transit of which it is required to obtain
certain documents (Official Gazette of RS, No 7/10), refers to the import of new wheeled vehicles;
- Regulation on the import of motor vehicles (Official Gazette of RS, No 23/10), refers to the import
of used motor vehicles of categories M and N;
- Rulebook on testing the vehicles (Official Gazette of RS, No 8/12).
Priorities for 2013 with regard to harmonisation of legislation
In the fourth quarter of 2013 it is planned to transpose Directive 2007/46/EC which is in the field of
wheeled vehicles by adopting the Regulation on approval of vehicles of categories M, N and O, partly har-
monised with Directive No 2007/46/EC with all amendments. The legal basis for adoption of the Regulation
is linked to the adoption of amendments to the Law on Road Traffic Safety (Official Gazette of RS, No
41/09 and 53/10);
Administrative capacities
According to the Law on Road Traffic Safety, on the proposal of Ministry of Transport, the Govern-
ment has established the Road Traffic Safety Agency which is, according to the law, in charge of the field of
motor vehicles and trailers. The implementation of regulations related to the road and motor vehicles and
trailers is performed by the Road Traffic Safety Agency, within which approval operations relating to tacho-
graphs are conducted, in connection with the database on technical characteristics of vehicles.
Transposition and implementation of Directive 2007/46/EC with all amendments, are under the compe-
tence of ABS - Vehicle Department. Within this Department, Division for approval of vehicles, equipment
and parts has 8 employees, who cover 126 regulations of the International Agreement on the adoption of uni-
form technical regulations for wheeled vehicles, equipment and parts which can be fitted and /or used on
wheeled vehicles and the conditions for mutual recognition of approvals granted on the basis of these regula-
tions, one of them being an employee engaged in the adoption of Regulation on type-approval of vehicles of
categories M, N and O, whereby Directive 2007/46/EC with all amendments will be transposed. Further
strengthening of administrative capacities is necessary.
Measures planned for the period 2014-2016
In the period 2014 - 2016 it is planned to transpose Directive 2002/24/EC and Directive 2003/37/EC
that are in the field of wheeled vehicles by adopting Regulation on type-approval of vehicles of categories L
and T, which is partially harmonised with Directives 2002/24/EC and 2003/37/EC with all amendments. The
legal basis for adoption of the Regulation is related to the adoption of amendments to the Law on Road Traf-
fic Safety (Official Gazette of RS, No 41/09 and 53/10);

144
3.1.2.2. Chemicals and detergents
This area is covered within Item 3.27.9. Chemicals.

3.1.2.3. Pharmaceuticals, medical devices, medical devices for active implantation and
in vitro diagnostic medical devices
Overview
To comply with the directives and regulations of the European Union in the field of medicines and
medical devices, a new Law on Medicines and Medical Devices has been enacted (Official Gazette of RS,
No 30/10 and 107/12). This law regulates the terms and procedure for obtaining the authorization for plac-
ing medicines of the market, or entry of medicines and medical devices in the registers maintained by the
Medicines and Medical Devices Agency of Serbia, production and placing on the market medicines and
medical devices and monitoring in these areas, the work of Medicines and Medical Devices Agency of Ser-
bia and other issues relevant to the area of medicines and medical devices. The Law also stipulates the tasks
performed by the Medicines and Medical Devices Agency as committed tasks, as well as its position, general
acts it adopts, its advisory and professional bodies, tariffs for the tasks it performs, and the supervision of its
work.
In this law the following EU regulations are partly transposed:
1. For medicines that are used in human medicine: Directive 2001/83/EC amended by Directives
2002/98/EC, 2003/63/EC, 2004/24/EC, 2004/27/EC, 2008/29/EC, 2009/53/EC and 2009/120/EC and
Regulations 726/2004 and 1394/2007;
2. For medicines that are used exclusively in veterinary medicine: Directive 2001/82/EC amended by
Directives 2004/28/EC, 2009/9/EC and 2009/53/EC and Regulations 726/2004 and 2377/90;
3. For medical devices that are used in human medicine: Directives 90/385/C, 93/342/C and
98/79/C;
4. For the production of human medicines: Directive 2003/94/EC, and for the production of veteri-
nary medicines Directive 91/412/EEC and Guidelines for Good Manufacturing Practice (part I and
II) with Annexes;
5. For pre-clinical testing of medicines: Directives 2004/9/C and 2004/10/C;
6. For clinical testing of medicines used in human medicine: Directives 2001/20/EC and
2005/28/EC and Guidelines for Good Clinical Practice;
7. For clinical testing of medicines that are used exclusively in veterinary medicine: Directive
2001/82/C;
8. For wholesale of medicines: Guidelines for Good Distribution Practice 94/Z and 63/03.
This law partially implements Directives 93/42/EEC and 98/79/EC, while Directive 2007/47/EC is
partially implemented through the by-laws enacted to implement this law.
So far, the following regulations, by-laws of this Law, have been adopted:
- Rulebook on detailed conditions and manner of registration of a medicine in the Register of tradi-
tional, herbal or homeopathic medicines (Official Gazette of RS, No 100/11),
- Rulebook on galenic medicines used in human medicine (Official Gazette of RS, No 85/11),
- Rulebook on the general classification of medical devices (Official Gazette of RS, No 46/11),
- Rulebook on the manner and procedure for registration, the content of application form and costs of
entry in the register of manufacturers of active substances (Official Gazette of RS, No 4/11),
- Rulebook on the quality control of medicines and medical devices (Official Gazette of RS, No
64/11),
- Rulebook on advertising medicines and medical devices (Official Gazette of RS, No
- Rulebook on the manner of reporting, collecting and monitoring of adverse reactions to medicines
(Official Gazette of RS, No 64/11),
- Rulebook on the manner of reporting, collecting and monitoring of adverse reactions to medicines
(Official Gazette of RS, No 64/11),

145
- Rulebook on registration of medical devices in the Register of medical devices and the content of
application form for registration of medical devices in the Register of medical devices (Official
Gazette of RS, No 57/10),
- Rulebook on registration, the content of application form and costs of entry in the register of labo-
ratories that perform laboratory testing (Official Gazette of RS, No 4/11),
- Rulebook on the application form and the content of inspector's identity card for medicines and
medical devices (Official Gazette of RS, No 69/10),
- Rulebook on the content of authorization for placing a medicine on the market (Official Gazette of
RS, No 30/12),
- Rulebook on the content and labelling of outer and inner packaging of medicines, additional label-
ling, and the content of instructions for use of medicines (Official Gazette of RS, No 41/11),
- Rulebook on the content and labelling of outer and inner packaging of medical devices, and the
content of instructions for use of medical devices (Official Gazette of RS, No 64/11),
- Rulebook on the content of certificate form of Good Laboratory Practice, data entered in the Regis-
ter of certificates issued and the manner of keeping the Register (Official Gazette of RS, No
100/11),
- Rulebook on the content of certificate form on applying the Guidelines for Good Manufacturing
Practice (Official Gazette of RS, No 100/11),
- Rulebook on the content of certificate form on applying the guidelines of Good Manufacturing
Practice for medicines used in veterinary medicine (Official Gazette of RS, No 34/12),
- Rulebook on the content of application form and documentation, and the method of obtaining the
authorization for placing a medicine on the market (Official Gazette of RS, No 30/12),
- Rulebook on the content of application form or documentation for approval of clinical testing of
medicines and medical devices, as well as the manner of conducting the clinical testing of medi-
cines and medical devices (Official Gazette of RS, No 64/11),
- Rulebook on the conditions for preparation of galenic medicines (Official Gazette of RS, No
10/12),
- Rulebook on the conditions for production of medicines, the content of authorization form for the
production of medicines and the Register of authorizations issued for the manufacture of medicines
(Official Gazette of RS, No 18/12),
- Rulebook on the conditions for production of medical devices (Official Gazette of RS, No 10/12),
- Rulebook on the conditions for retail sale of medical devices in specialized retail outlets (Official
Gazette of RS, No 10/12),
- Rulebook on the conditions for the wholesale of medicines and medical devices, data entered in the
Register of authorizations for the wholesale distribution of medicines and medical devices, as well
as the mode of entry (Official Gazette of RS, No 10/12).
- Rulebook on the conditions, the content of documents and the manner of approving amendments to
the authorization for placing a medicine on the market (Official Gazette of RS, No 30/12).
- A list of medicines that are not prescribed and can be advertised in the media on 31 December 2010
(Official Gazette of RS, No 14/11, 91/11, 77/12, 111/12),
- Guidelines for Good Manufacturing Practices. (Official Gazette of RS, No 86/10).
Medical devices can be marketed in the Republic of Serbia if they are registered in the Register of
medical devices.
Entry in the Register of medical devices is based on:
1. Certificate of Conformity issued by a competent notified body or the declaration of conformity;
2. Authorization for a medical device not harmonised with EU directives in the field of medical de-
vices.
In the field of medical devices, harmonised Serbian standard ISO 13 485, which refers to the quality
system production of medical devices, is used.

146
Monitoring in this area is conducted by the Medicines and Medical Devices Agency of Serbia during
registering in the Register of medical devices and quality control, as well as by the Ministry of Health
through inspectors monitoring of production and distribution of medical devices.
Priorities for 2013 with regard to harmonisation of legislation
In 2013 the priority is the preparation and adoption of amendments to the Law on Medicines and
Medical Devices, to comply with EU regulations, and among others, with Directive 89/105/EEC of
21/12/1988 regarding transparency of measures regulating the prices of medicines for use in human medicine
and their inclusion in the framework of the national health insurance system.
In addition, there is an intention to adopt the following by-laws, which will also be harmonised with
the above mentioned directive:
- on the program and manner of acquiring the licence, and the licence revocation method for per-
forming the tasks of a qualified pharmacist responsible for the release of certain types of medicines
in a particular pharmaceutical form;
- on the form and content of a prescription for medicines that are dispensed on prescription, as well
as the method of dispensing and prescribing medicines;
- on the manner, procedure and conditions for destruction of medicines and medical devices, initial
substances and other materials used in the production and the wholesale of medicines and medical
devices, or retail sale of medical devices in specialized shops, as well as the preparation of galenic
or magistral medicines;
- on documentation needed for the import of medicines with no authorization for the medicines, and
the manner of import of medicines with no authorization for the medicines.
Administrative capacities
For work in this area, there is a Section for Medicines and Medical Devices, which consists of 5 peo-
ple: 1 legal practitioner, 1 economist, 3 pharmacists (one of whom is head of section).
At the Medicines and Medical Devices Agency of Serbia, for the performance of related, intercon-
nected tasks, there is: National Control Laboratory, National Centre for pharmaco-vigilance, National Centre
for Information on Medicines and Medical Devices, Centre for Human Drug Administration, Centre for sup-
port, Pharmacy Department, Medical Department, Veterinary Department, Department of Medical Devices,
Department of marketing human medicines, Department for evaluation of drug documents, Administrative
Department, Department of Finance, Group for Information technology, Physico-chemical laboratory, Bio-
logical laboratory and Division of quality management and support, and operations of governing the quality
management and the Manager office, making a total of 96 employees.
Measures planned for the period 2014-2016
In the period 2014-2016 it is planned to continue work on the implementation of the Law on Medi-
cines and Medical devices, as well as the regulations adopted for its implementation. Also, there will be fur-
ther monitoring, analysis and implementation of EU legislation in the field of medicines and medical
devices, for the sake of harmonisation and improvement of regulations in this area in the Republic of Serbia.

3.1.2.4. Cosmetics and the safety of toys


Overview
The Law on Health Requirements for the Items of General Use was adopted and published in the Of-
ficial Gazette of RS, No 92/2011.
Pursuant to Article 6 Paragraph 2 of this Law, it provides the adoption of the Rulebook on the health
safety and method of labelling children's toys and items intended for children and infants and the Rulebook
on health safety and way of labelling cosmetic products and cosmetic products with a special purpose.
The original deadline for their creation was 2012, but the Rulebooks were not completed on time due
to unrealistic deadlines for making these regulations, given the current administrative capacities, due to the
lack of translation of directives, but also because of the lack of a legal basis in the existing law.
Working groups have been formed and began their work on the preparation of a draft Rulebook in
early June 2012. It is expected that the transposition of these directives or the preparation of these Rulebooks
will be supported through the implementation of IPA 2010 project Strengthening of the Serbian system of

147
market surveillance for food and non-food products, where one of the beneficiaries is the Ministry of
Health.
Priorities for 2013 with regard to harmonisation of legislation
Rulebook on health safety and manner, content and detailed conditions of labelling and marking of
children's toys and items for children and infants - Directive 2009/48/EC. The Rulebook will provide re-
quirements to be met by children's toys in terms of health safety and security. This will effect a partial trans-
position of Directive 2009/48/EC.
Rulebook on health safety and manner, content and detailed conditions of labelling and marking of
cosmetic products, cosmetic products with a special purpose and packaging for these products - Directive
76/768/EEC and Regulation 1223/2009. The Rulebook will stipulate the requirements as regards health
safety and security to be met by cosmetic products and cosmetic products with a special purpose. This will
make partial compliance with Directive 76/768/EEC and Regulation 1223/2009.
Administrative capacities
In the Ministry of Health there is Department for Inspection, which includes a Division of Sanitary In-
spection, which employs 155 state sanitary inspectors. On transposition and implementation of EU legisla-
tion a total of four employees is engaged. Provincial Secretariat of Health, Social Policy and Demography
AP Vojvodina (Department for sanitary inspection and preventive medical activities - Division of Health
Inspection) employs 55 provincial sanitary inspectors, while on the transposition and implementation of EU
regulations 40 percent of the total of 210 employees are engaged. As regards other institutions working on
the implementation of EU regulations, there is a network of institutes and offices of public health, as well as
other accredited and authorised laboratories.
Measures planned for the period 2014-2016
It is planned to strengthen the capacity, the implementation of transposed legislation and the follow-up
of EU legislation.
More information on the status and priorities in the field of safety of toys will be given in Chapter 28.
Review of current and planned foreign development aid
The participation in the IPA 2010 project Strengthening of the Serbian system of market surveillance
of food and non-food products to support transposing of Directives 2009/48/EC, 76/768/EEC and comply-
ing with Regulation 1223/2009 has been planned.

3.1.2.5. Glass
Overview
On crystal glass products, in Serbia there are currently no special technical regulations that prescribe
technical requirements for the composition and labelling of crystal glass products, as well as methods for
determining the chemical and physical properties of crystal glass types, therefore market surveillance of the
safety and labelling of products is carried out by enforcing the Law on Product General Safety by the Market
Inspection Department of the Ministry of Foreign and Internal Trade and Telecommunications.
In 2013 no legislative actions in this area have been planned.
Administrative capacities
Transposition and implementation of Directive 69/493/EEC are under the authority of MFE Quality
Infrastructure Department. Within this Department, Division of Technical Regulations and Conformity As-
sessment has a total of 8 employees, out of which three are engaged in the Group for technical regulations,
cover a total of 7 regulations whereby European directives have been transposed and 3 planned regulations
including the regulation whereby Directive on glass will be transposed.
Measures planned for the period 2014-2016
MFE is planning the transposition of Directive 69/493/EEC relating to crystal glass products, by the
adoption of the Rulebook on technical and other requirements of crystal glass products in 2014. After trans-
posing the directive into national legislation and the appropriate European standards in the field of crystal
glass products, activities will be undertaken to improve the conformity assessment infrastructure or surveil-
lance of the new framework application for placing these products on the market.

148
3.1.2.6. Textile
Overview
This area is currently regulated by the following regulations: Order on textile products which on the
market must be provided with a certificate of quality (Official Gazette of RS, No 14/92), Rulebook on tech-
nical and other requirements for labelling, marking and packaging of textile products ( Official Gazette of
RS, No 56/09), Order on obligatory attesting of cotton (Official Journal of SFRY, No 665/84, 44/88), Order
on obligatory attesting of wool (Official Journal of SFRY, No 65/84) and Rulebook on the mandatory certifi-
cation of jute and the conditions to be met by organizations of associated labour authorized to certify these
products (Official Journal of SFRY, No 8/91).
Priorities for 2013 with regard to harmonisation of legislation
Adoption of technical regulations in the field of textiles under the competence of MFE. In 2013 it is
planned to draft the Rulebook on marking and labelling of textile products. By this Rulebook the Regulation
(EU) 1007/2011 will be fully transposed in Serbian legislation.
Administrative capacities
Transposition and implementation of Regulation 1007/2011 are under the authority of MFE - Quality
Infrastructure Department. Within this Department, Division of Technical Regulations and Conformity As-
sessment has a total of 8 employees, three of which, engaged in the Group for technical regulations, cover a
total of seven regulations whereby European directives have been transposed and 3 planned regulations in-
cluding the regulation whereby Regulation 1007/2011 will be transposed.
The Ministry of Foreign and Internal Trade and Telecommunications - Market Inspection Department
conducts market surveillance of textile products.
Measures planned for the period 2014-2016
Following the harmonisation of national legislation with EU Regulation 1007/2011 in the field of tex-
tile and the transposition of appropriate European standards, activities will be undertaken to improve the in-
frastructure of conformity assessment and/or monitoring the implementation of a new framework for placing
textile products on the market of the Republic of Serbia.
Review of current and planned foreign development aid
The transposition of Regulation 1007/2011 will be supported by the EU project IPA 2010 Strength-
ening of the Serbian market surveillance system for food and non-food products.

3.1.2.7. Footwear
Overview
This area is currently regulated by the Rulebook on technical and other requirements for marking, la-
belling and packaging method of finished leather and fur, products of natural and artificial leather (Official
Gazette of RS, No 56/09).
In accordance with this Rulebook, the products to which this Rulebook applies, except requirements
prescribed by special technical regulations, when being put on the market or used, must meet the require-
ments laid down by a Serbian standard SRPS G.B1.035 - Finished leather, fur, products of natural and arti-
ficial leather. Marking, labelling and packaging method.
Priorities for 2013 with regard to harmonisation of legislation
In 2013 it is planned to draw up the Rulebook on labelling and marking of footwear. By these rules it
will be fully transposed into Serbian legislation the Directive 94/11/EC relating to the labelling of materials
used for the main components of footwear intended for sale to consumers. Adoption of technical regulations
in the field of footwear is under the competence of MFE.
Administrative capacities
Transposition and implementation of Directive 94/11/EC are under the authority of MFE - Quality In-
frastructure Department. Within this Department, Division for technical regulations and conformity assess-
ment has a total of 8 employees, of which three, engaged in the Group for technical regulations, cover a total
of seven regulations whereby European directives have been transposed and 3 planned regulations including
a regulation to transpose Directive 94/11/EC will be transposed.

149
Ministry of Foreign and Internal Trade and Telecommunications Division for Market Inspection
conducts market surveillance of footwear.
Measures planned for the period 2014-2016
After the transposition of Directive 94/11/EC into national legislation and taking up appropriate Euro-
pean standards, activities will be undertaken to improve the conformity assessment infrastructure and moni-
toring the implementation of a new framework for placing these products on the market.
Review of current and planned foreign development aid
Transposition of Directive 94/11/EC will be supported by the IPA 2010 project Strengthening of
the Serbian market surveillance system for food and non-food products.

3.1.2.8. Fertilizers
Overview
In the field of fertilizers (plant fertilizers and soil conditioners) the legislation of Republic of Serbia is
harmonised with the relevant EU regulations. The Law on fertilizers and soil conditioners (Official Gazette
of RS, No 41/09) is, in the part relating to mineral fertilizers, fully compliant with Regulation 2003/2003/EC,
except for the provisions of the Regulation which are not possible to be transposed into national legislation
(Articles of Regulation concerning the European Commission's procedures, including notification of the EC
by Member States in relation to national provisions, as well as transitional and final provisions of this Regu-
lation). Most articles of the Regulation (6, 9, 16-23) have been transposed into the appropriate by-laws.
In addition to fertilizers, this Law regulates plant nutrition and soil organic breeders, produced from
animal by-products not intended for human consumption. Harmonisation with this part of Regulation
1069/2009 is achieved by the by-law which includes a connection with the relevant national regulation in the
field of veterinary medicine, which has been passed in accordance with the said Regulation.
Based on the Law on Fertilizers and Soil Conditioners, all by-laws for its implementation have been
adopted.
Priorities for 2013 with regard to harmonisation of legislation
In 2013 activities are planned for amending the by-laws in accordance with amendments of the Annex
to the Regulation of the European Parliament and the Council No 2003/2003/EC for mineral fertilizers
adopted until 2012.
Administrative capacities
The current number of employees in the Department of Plant Protection (3 positions in Division of
Plant Protection and Plant Nutrition, 34 border phytosanitary inspectors and 55 phytosanitary inspectors) and
their educational profile in the field of fertilizers for plant nutrition and soil conditioners (B.Sc. Agriculture)
is sufficient to support the law enforcement.
Measures planned for the period 2014-2016
Activities are planned on amending the by-laws in accordance with amendments to the Annex of the
Regulation 2003/2003/EC for mineral fertilizers.

3.1.2.9. Wood
Having taken into account that the European level directives relating to wood are repealed, the MFE
does not have plans for legislative actions in this area.

3.1.3. New Approach Directives

3.1.3.1. Low voltage electrical equipment


Overview
Adoption of technical regulations in the field of electrical equipment intended for use within certain
voltage limits is under the authority of MFE.

150
The Rulebook on Electrical Equipment intended for use within certain voltage limits is published on
12/3/2010 in Official Gazette of RS, No 13/10 and entered into force on 20/3/2010. The Rulebook is harmo-
nised with all the principles and essential requirements of Directive 2006/95/EC.
The Rulebook is accompanied by a list of Serbian standards in the field of electrical equipment de-
signed for use within certain voltage limits which was on published 24/05/2012 in Official Gazette of RS, No
55/12. This list is regularly updated in accordance with the list of harmonised standards published in the EU
Official Journal.
In 2013 no legislative actions are planned in this area.
Administrative capacities
Transposition and implementation of Directive 2006/95/EC are under the authority of MFE - Quality
Infrastructure Department. Within this Department, Division of Technical Regulations and Conformity As-
sessment has a total of eight employees, three of which, engaged in the Group for technical regulations,
cover a total of seven regulations whereby European New Approach Directives (including Directive
2006/95/EC) have been transposed and 3 planned regulations whereby European Old Approach Directives
will be transposed.
Monitoring the implementation of regulations in the field of low-voltage electrical equipment is car-
ried out by the Ministry of Foreign and Internal Trade and Telecommunications - Market Inspection Divi-
sion.
Measures planned for the period 2014-2016
Activities planned in this area will focus on the establishment of permanent mutual cooperation be-
tween competent ministries that adopt regulations, the ministries that apply the regulations, ISS, ATS, con-
formity assessment bodies, as well as economic operators and consumers affected by the regulations applied,
with a view to implementing activities to improve the conformity assessment infrastructure and monitoring
the implementation of a new framework for placing these products on the market.
Further, monitoring and harmonisation of national legislation with EU legislation will be continued (in
case of EU legislation changes) in the field of electrical equipment designed for use within certain voltage
limits, and it is planned to transpose the total number of harmonised standards and training for the full im-
plementation of this Rulebook.

3.1.3.2. Simple pressure vessels


Overview
Adoption of technical regulations in the field of simple pressure vessels is the responsibility of
DEP.
The Rulebook on technical requirements for design, development and conformity assessment of sim-
ple pressure vessels (Official Gazette of RS, No 87/11) entered into force on 29/11/2011, and its enforcement
began on 1/7/2012. The Rulebook is harmonised with all the principles and essential requirements of Direc-
tive 2009/105/EC.
The Rulebook is accompanied by a list of Serbian standards in the field of simple pressure vessels
which was published on 21/12/2011 in Official Gazette of RS, No 97/11. This list is regularly updated in ac-
cordance with the list of harmonised standards published in the EU Official Journal.
In 2013 no legislative actions are planned in this area.
Administrative capacities
Transposition and implementation of Directive 2009/105/EC are under the authority of MEDEP - Divi-
sion of Oil and Gas. This Department has a total of nine employees of which four cover a total of 4 regula-
tions transposing European New Approach Directives and other technical regulations in the field of oil and
oil products, natural gas and pressure equipment.
Monitoring the implementation of regulations in the field of simple pressure vessels is conducted by
the Ministry of Energy, Development and Environmental Protection Department for Supervision and
Monitoring - Inspection of pressure equipment and Ministry of Foreign and Internal Trade and Telecommu-
nications - Market Inspection Division.

151
Measures planned for the period 2014-2016
Activities planned in this area will focus on the establishment of permanent mutual cooperation be-
tween the competent ministry that adopts regulations, the ministry that implements the regulations, ISS,
ATS, conformity assessment bodies, as well as economic operators and consumers to which these regula-
tions apply, with a view to implementing activities to improve the conformity assessment infrastructure and
monitoring the implementation of a new framework for placing these products on the market.
Further, monitoring and harmonisation of national legislation with EU legislation will be continued (in
case of EU legislation changes) in the field of simple pressure vessels, and it is planned to transpose the total
number of harmonised standards for the full implementation of the Rulebook.

3.1.3.3. Safety of machinery


Overview
The adoption of technical regulations in the field of machinery is under the authority of MFE. Ma-
chinery Safety Rulebook was released on 12/3/2010 in Official Gazette of RS, No 13/10 and entered into
force on 20/3/2010. This Rulebook is harmonised with all the principles and essential requirements of Direc-
tive 2006/42/EC on machinery. When drawing up this Rulebook, besides the mentioned EU directives, refer-
ence solutions in the field of EU technical legislation were also taken into consideration, in particular from
Decision No 768/2008 of the European Parliament and the Council on a common framework for trading in
products.
This Rulebook is accompanied by a list of Serbian standards in the field of machinery which was pub-
lished on 24/5/2012 in Official Gazette of RS, No 55/12. This list is regularly updated in accordance with the
list of harmonised standards published in the EU Official Journal.
In 2013 no legislative actions are planned in this area.
Administrative capacities
Transposition and implementation of Directive 2006/42/EC are under the authority of MFE - Quality In-
frastructure Department. Within this Department, Division of Technical Regulations and Conformity As-
sessment has a total of eight employees, three of which, engaged in the Group for technical regulations,
cover a total of 7 regulations whereby European New Approach Directives (including Directive 2006/42 EC)
have been transposed and 3 planned regulations whereby European Old Approach Directives will be trans-
posed.
Monitoring the implementation of regulations in the field of machinery is conducted by the Ministry
of Foreign and Internal Trade and Telecommunications - Market Inspection Department and the Ministry of
Labour, Employment and Social Policy - Labour Inspectorate.
Measures planned for the period 2014-2016
Activities planned in this area will focus on the establishment of permanent mutual cooperation be-
tween the competent ministry that adopts regulations, the ministry that implements the regulations, ISS,
ATS, conformity assessment bodies, as well as economic operators and consumers to which these regula-
tions apply, with a view to implementing activities to improve the conformity assessment infrastructure and
monitoring the implementation of a new framework for placing these products on the market.
Further, monitoring and harmonisation of national legislation with EU legislation in the field of
machine safety will be continued (in case of EU legislation changes), and it is planned to transpose the total
number of harmonised standards and training for the full implementation of the Rulebook.

3.1.3.4. Explosives for civil use and equipment and protective systems in potentially
explosive environments
Explosives for civil use
Overview
The jurisdiction of the Ministry of Interior in this area includes the area of explosives for civil use.
The area is currently regulated by the Law on explosive substances, flammable liquids and gases (Of-
ficial Gazette of RS, No 44/77, 45/85 and 18/89 and Official Gazette of RS, No 53/93, 67 / 93, 48/94 and
101/2005 - state law) and by-laws adopted hereunder. This law does not comply with European directives.

152
Priorities for 2013 with regard to harmonisation of legislation
There are activities planned for drafting a Law on explosive substances and its full implementation:
Directive 93/15/EEC on explosives for civil use (CIVEX), Directive 2004/57/EC on the identification of py-
rotechnic products, and Directive 2007/23/EC concerning placing pyrotechnic products on the market.
Administrative capacities
Transposition and implementation of Directive 93/15/EEC on explosives for civil use (CIVEX), Direc-
tive 2004/57/EC on the identification of pyrotechnic products and Directive 2007/23/EC on placing pyro-
technic products on the market are under the jurisdiction of Ministry of Interior Sector for Emergency
Menagementt. Within this Sector of the Administration for Preventive Protection, two employees are en-
gaged who besides drawing up these regulations work on drawing up other regulations within the scope of
this Department.
Measures planned for the period 2014-2016
It is planned to draw up by-laws arising from the new law of explosive substances, e.g. a rulebook to
regulate technical requirements for explosives, rulebooks to regulate a way of keeping records of the use of
explosives and records of legal entities engaged in trade of these substances, a rulebook or a regulation on
specific requirements for facilities in which explosives are used, a rulebook to regulate firework, a rulebook
to regulate conditions of qualification for the use of explosives, a rulebook to regulate measures for safe de-
struction of explosives and pyrotechnics.
Equipment and protective systems in potentially explosive environments
Overview
Adoption of technical regulations in the field of equipment and protective systems intended for use in
potentially explosive atmospheres is under the jurisdiction of MFE.
This area is regulated by the Rulebook on equipment and protective systems intended for use in poten-
tially explosive atmospheres (Official Gazette of RS, No 1/2013). This Rulebook is fully harmonised with all
the principles and essential requirements of Directive 94/9/EC. When drafting this rulebook, besides the said
EU directive, the solutions were taken into consideration from reference EU regulations in the field of tech-
nical legislation, in particular from Decision No 768/2008 of the European Parliament and the Council on the
common framework for trading in products. In the transitional and final provisions of this rulebook it is
stipulated that this policy applies from 1/1/2015.
This rulebook will be accompanied by a list of Serbian standards in the field of protective equipment
and systems that is prepared and published by the Minister of Economy and Minister responsible for stan-
dardisation, technical requirements for products, accreditation and metrology in Official Gazette of RS, in
accordance with the law, this rulebook and a special regulation. These are Serbian standards whereby appro-
priate harmonised (European) standards adopted by the ISS are transposed.
Until the implementation of the said rulebook, an Order on the mandatory certification of electrical
equipment for potentially explosive atmospheres is applied (Official Gazette of RS, No 35/95).
Administrative capacities
Transposition and implementation of Directive 94/9/EC are under the authority of MFE - Quality Infra-
structure Department. Within this Department, Division of Technical Regulations and Conformity Assess-
ment has a total of eight employees, three of which, engaged in the Group for technical regulations, cover a
total of 7 regulations whereby European New Approach Directives (including the Directive 94/9/EC) have
been transposed and 3 planned regulations whereby the European Old Approach Directives will be trans-
posed.
Measures to implement the priorities in 2013
In the first quarter of 2013 it is planned to issue and publish a list of Serbian standards in the field of
equipment and protective systems intended for use in potentially explosive atmospheres, whereby the appro-
priate European harmonised standards adopted by ISS have been transposed.
Measures planned for the period 2014-2016
Activities planned in this area will focus on the establishment of permanent mutual cooperation be-
tween the competent ministry that adopts regulations, the ministry that implements the regulations, ISS,
ATS, conformity assessment bodies, as well as economic operators and consumers to which these regula-

153
tions apply, with a view to implementing activities to improve the conformity assessment infrastructure and
monitoring the implementation of a new framework for placing these products on the market.
Further, monitoring and harmonisation of national legislation with EU legislation in the field of
equipment and protective systems intended for use in potentially explosive atmospheres will be continued (in
case of EU legislation changes), and it is planned to transpose the total number of harmonised standards and
training for the full implementation of Rulebook.

3.1.3.5. Lifts
Overview
Adoption of technical regulations in the field lifts is the responsibility of MFE. Rulebook on Safety of
Lifts was published on 29/12/2010 in the Official Gazette of RS, No 101/10. The Rulebook is harmonised
with all the principles and essential requirements of Directive 95/16/EC on lifts, including Directive
2006/42/EC in the part relating to amendments to Directive 95/16/EC. When drafting this Rulebook, besides
the said EU directives, solutions from the reference EU regulations in the field of technical legislation were
taken into consideration, in particular from Decision No 768/2008 of the European Parliament and the Coun-
cil on the common framework for trading in products.
The Rulebook is accompanied by a list of Serbian standards in the field of Lifts which was published
in Official Gazette of RS, No 6/11. This list is regularly updated in accordance with the list of harmonised
standards published in the EU Official Journal.
In 2013 no legislative actions are planned in this area.
Administrative capacities
Transposition and implementation of Directive 95/16/EC are under the authority of MFE - Quality Infra-
structure Department. Within this Department, Division for technical regulations and conformity assessment
has a total of eight employees, three of which, engaged in the Group for technical regulations, cover a total
of 7 regulations whereby European New Approach Directives (including Directive 95/16/EC) have been
transposed and 3 planned regulations whereby European Old Approach Directives will be transposed.
Monitoring the implementation of regulations in the field of Lifts is conducted by civil engineering
inspection, in accordance with the Law on Planning and Construction (Official Gazette of RS, No 72/09,
81/09, 64/10 and 24/11).
Measures planned for the period 2014-2016
Activities planned in this area will focus on the establishment of permanent mutual cooperation be-
tween the competent ministry that adopts regulations, the ministry that implements the regulations, ISS,
ATS, conformity assessment bodies, as well as economic operators and consumers to which these regula-
tions apply, with a view to implementing activities to improve the conformity assessment infrastructure and
monitoring the implementation of a new framework for placing these products on the market.
Further, monitoring and harmonisation of national legislation with EU legislation in the field of lifts
will be continued (in case of EU legislation changes), and it is planned to transpose the total number of har-
monised standards and training for the full implementation of Rulebook.

3.1.3.6. Pressure equipment


Overview
Adoption of technical regulations in the field of pressure equipment is under the authority of Ministry
of Energy, Development and Environmental Protection (DEP). The Rulebook on the technical require-
ments for design, development and conformity assessment of pressure equipment (Official Gazette of RS,
No 87/11) entered into force on 29/11/2011, and its implementation began on 07/01/2012. The Rulebook is
harmonised with all the principles and essential requirements of Directive 97/23/EC.
The Rulebook is accompanied by a list of Serbian standards in the field of pressure equipment which
was published on 21/12/2011 in the Official Gazette of RS, No 97/11. This list is regularly updated in accor-
dance with the list of harmonised standards published in the EU Official Journal.
In 2013 no legislative actions are planned in this area.

154
Administrative capacities
Transposition and implementation of Directive 97/23/EC are under the authority of MEDEP - Depart-
ment of Oil and Gas. This Department has a total of nine employees of which 4 cover a total of four regula-
tions whereby European new approach directives have been transposed, as well as other technical regulations
in the field of oil and oil products, natural gas and pressure equipment.
Monitoring the implementation of regulations in the field of pressure equipment is conducted by the
Ministry of Energy, Development and Environmental Protection - Division of control and supervision -
Inspection for pressure equipment.
Measures planned for the period 2014-2016
Activities planned in this area will focus on the establishment of permanent mutual cooperation be-
tween the competent ministry that adopts regulations, the ministry that implements the regulations, ISS,
ATS, conformity assessment bodies, as well as economic operators and consumers to which these regula-
tions apply, with a view to implementing activities to improve the conformity assessment infrastructure and
monitoring the implementation of a new framework for placing these products on the market.
Further, monitoring and harmonisation of national legislation with EU legislation will be continued
(in case of EU legislation changes) in the field of pressure equipment, and it is planned to transpose the total
number of harmonised standards for the full implementation of Rulebook.

3.1.3.7. Hot water boilers (boilers), gas appliances and refrigeration equipment
Hot water boilers, gas appliances
Overview
Adoption of technical regulations in the field of hot-water boilers and gas appliances is the responsi-
bility of MEDEP.
The area of gas appliances in the Republic of Serbia is currently regulated by the following regula-
tions:
1. Rulebook on technical standards for portable flueless gas heaters (Official Journal of SFRY, No
43/80)
2. Order on the mandatory certification of gas appliances (Official Gazette of RS, No 58/94)
3. Order on the mandatory certification of portable flueless gas heaters (Official Journal of SFRY,
No 1/82)
The above mentioned regulations set out the conditions and methods of making and testing, i.e. certifi-
cation of certain gas appliances.
Activities related to the conformity assessment of gas appliances are currently performed by accredita-
tion bodies for product certification.
The said regulations do not define the conditions for making and conformity assessment of hot water
boilers. There are no bodies assessing the conformity of these products.
Priorities for 2013 with regard to harmonisation of legislation
In 2013 it is planned to adopt a Rulebook on gas appliances, whereby Directive 2009/142/EC will be
fully transposed.
This Rulebook shall be accompanied by a list of Serbian standards in the field of gas appliances
(whereby European harmonised standards will be transposed), whose implementation will achieve harmoni-
sation with essential requirements of the Rulebook.
In 2013 it is planned to adopt the Rulebook on hot-water boilers, whereby Directive 92/42/EEC will
be fully transposed.
This Rulebook shall be accompanied by a list of Serbian standards in the field of hot-water boilers
(whereby European harmonised standards will be transposed) and whose implementation will achieve har-
monisation with essential requirements of the Rulebook.
Administrative capacities
Transposition and implementation of Directive 2009/105/EC are under the authority of MFE - Depart-
ment of Oil and Gas. This Department has a total of nine employees of which four cover a total of 4 regula-

155
tions whereby European new approach directives have been transposed, as well as other technical regulations
in the field of oil and oil products, natural gas and pressure equipment.
Measures planned for the period 2014-2016
Activities planned in this area will focus on the establishment of permanent mutual cooperation be-
tween the competent ministry that adopts regulations, the ministry that implements the regulations, ISS,
ATS, conformity assessment bodies, as well as economic operators and consumers to which these regula-
tions apply, with a view to implementing activities to improve the conformity assessment infrastructure and
monitoring the implementation of a new framework for placing these products on the market.
Further, monitoring and harmonisation of national legislation with EU legislation will be continued (in
case of EU legislation changes) on gas appliances and hot water boilers, and it is planned to transpose the
total number of harmonised standards for the full implementation of Rulebook.
Refrigerating appliances
Overview
In accordance with the Treaty on Establishing the Energy Community (Official Gazette of RS, No
62/06) and Decisions of the Ministerial Council of Energy Community, D/2010/02/MC-EnC of 24/9/2010
and D/2011/03/MC-EnC of 06/10/2011, among other things, the Republic of Serbia is bound to implement
Directive 2010/30/EU of the European Parliament and of the Council on stating energy consumption and
other resources at products that affect energy consumption by labelling and providing standard product in-
formation, which is replacing and repealing Directive 92/75/EEC and the appropriate regulations that more
precisely define the obligations in terms of energy efficiency labelling of certain types of appliances among
which is Regulation (EC) 1060/2010 amending Directive of the European Parliament and the Council
2010/30/EU in relation to energy labelling of household refrigerating appliances.
Currently there is no legal framework for the adoption of these directives but a Draft law on effective
use of energy is prepared, which will create the necessary legal basis. Adoption of this law is expected no
later than the end of 2013.
Priorities for 2013 with regard to harmonisation of legislation
Ministry of Energy, Development and Environmental Protection with the help of an inter-ministerial
working group has prepared a Draft Rulebook on energy efficiency labelling of household air conditioners,
which directly transposes the requirements of Regulation (EU) No 1060/2010, which cannot be adopted until
the adoption of laws which regulate efficient energy use.
It is expected that the Rulebook will be adopted by the end of 2013, and thus effect full harmonisation
with this regulation.
Administrative capacities
Department of Energy Efficiency currently employs 4 people. As regards the implementation of this
directive it is not planned to further strengthen administrative capacities, but for the full implementation of
the Law it will be necessary to expand the department to at least 10 employees.

3.1.3.8. Radio and Telecommunications Terminal Equipment


Overview
As regards radio and telecommunications terminal equipment, the ministry responsible for telecom-
munications as early as in 2011 adopted the Rulebook on radio equipment and telecommunications terminal
equipment, but in 2012 amendments were made (Official Gazette of RS, No 67/11 and 11/12). Activities are
continued on the implementation of Rulebook on radio equipment and telecommunications terminal equip-
ment and on 29/5/2012 (as the Ministry of Culture and Information, the telecommunications authority) it ap-
pointed the Republic Agency for Electronic Communications (RATEL) as the conformity assessment body
for RTT equipment with the essential requirements of the Rulebook under Article 13 of the Law on Techni-
cal Requirements for Products and Conformity Assessment (Official Gazette of RS, No 36/09) and Article 7
Paragraph 4 of the Regulation on the manner of appointment and authorisation of conformity assessment
bodies (Official Gazette of RS, no 98/09). Republic Agency for Electronic Communications has been nomi-
nated for the following tasks: 1) review of technical documentation with the release of Statements of con-
formity with all relevant requirements under Art. 4. and 8 of the Rulebook from Appendix 3 of the Rulebook,
in accordance with Article 16 Paragraph 2 Item 1 of the Rulebook and 2) review the technical documentation

156
with the release of Certificate of conformity with all relevant requirements under Art. 4 and 8 of the Rule-
book in accordance with Article 18 of the Rulebook.
Also, the Ministry in early July 2012 adopted a List of Serbian standards in the field of radio equip-
ment and telecommunications terminal equipment (Official Gazette of RS, No 68/12). The preparation and
publication of the List of Serbian standards in radio equipment and telecommunications terminal equipment
is an obligation arising from the Law on Technical Requirements for Products and Conformity Assessment,
and the obligation is related to the beginning of implementation of the Rulebook on radio equipement and
telecommunications terminal equipment, given that the appointed body applies this document in the confor-
mity assessment procedure. By this act a list of standards published by the European commission was
adopted, relating to the implementation of the EU Directive 1999/5 with which the Rulebook on radio
equipment and telecommunications terminal equipment is in full compliance.
Priorities for 2013 with regard to harmonisation of legislation
In order to achieve full harmonisation, further amendments to this Rulebook have been provided for
the sake of additional harmonisation with the announced revision of Directive 1999/5/EC.
Administrative capacities
For transposition and implementation of Directive 1999/5/EC two employees are engaged in Depart-
ment for electronic communications, information society and postal services of the Ministry of Foreign and
Internal Trade and Telecommunications.

3.1.3.9. Electromagnetic Compatibility


Overview
Adoption of technical regulations in the field of electromagnetic compatibility is the responsibility of
MFE.
The Rulebook on Electromagnetic Compatibility was published on 12/3/2010 in the Official Gazette
of RS, No 13/10. The Rulebook is harmonised with all the principles and relevant requirements of Directive
2004/108/EC. When drafting this Rulebook, besides the said EU directives, solutions from the reference EU
regulations in the field of technical legislation were taken into consideration, in particular Decision No
768/2008 of the European Parliament and the Council on a common framework for trading in products.
The Rulebook is accompanied by the list of Serbian standards in the field of electro-magnetic com-
patibility which was published on 05/24/2012 in the Official Gazette of RS, No 55/12. This list is regularly
updated in accordance with the list of harmonised standards published in the EU Official Journal.
In 2013 no legislative actions are planned in this area.
Administrative capacities
Transposition and implementation of Directive 2004/108 EC are under the authority of MFE - Quality
Infrastructure Department. Within this Department, Division of Technical Regulations and Conformity As-
sessment has a total of eight employees, three of which, engaged in the Group for technical regulations,
cover a total of 7 regulations whereby European new approach directives (including Directive 2004/108/EC)
have been transposed and 3 planned regulations whereby European old approach directives will be trans-
posed.
Monitoring the implementation of regulations in the field of electromagnetic compatibility is con-
ducted by the Ministry of Foreign and Internal Trade and Telecommunications - Division of Market Inspec-
tion.
Measures planned for the period 2014-2016
Further development in this area will focus on the establishment of permanent mutual cooperation be-
tween competent ministries to adopt regulations, the ministry to apply the regulations, ISS, ATS, conformity
assessment bodies, as well as economic operators and consumers to which these regulations apply, with a
view to implementing activities to improve the conformity assessment infrastructure and monitoring the im-
plementation of a new framework for placing these products on the market.
Further monitoring and harmonisation of national legislation with EU legislation in the field of elec-
tromagnetic compatibility, and it is necessary to transpose the total number of harmonised standards and
training for the full implementation of Rulebook on electromagnetic compatibility.

157
3.1.3.10. Recreational crafts
Overview
Law on Maritime Navigation (Official Gazette of RS, No 87/11) regulates this area. The Ministry of
Transport is responsible for regulating this area.
Priorities for 2013 with regard to harmonisation of legislation
Drafting the Rulebook on conditions for placing recreational crafts on the market is underway, the
conditions that must be fulfilled by the appointed bodies, and the manner and procedure of their appoint-
ment, whereby Directive 94/25/EC and Directive 2003/44/EC concerning placing the recreational boats on
the market are fully implemented.
Administrative capacities
The Ministry of Transport, Department of Waterways and Navigation Safety, has three employees
who work on drafting the regulations.

3.1.3.11. Marine Equipment


Overview
Law on Maritime Navigation (Official Gazette of RS, No 87/11) governs this area. The Ministry of
Transport is responsible for regulating this area.
Priorities for 2013 with regard to harmonisation of legislation
It is planned that by the end of June 2013 a bylaw is adopted that would fully implement the Council
Directive 96/98 of 20/12/1996 on maritime equipment.
Administrative capacities
The Ministry of Transport, Department of Waterways and Navigation Safety, has three employees
who are engaged in drawing up the regulations.

3.1.3.12. Cable cars to transport people


Overview
So far the area of cable cars has not been regulated under the authority of Ministry of Transport.
Administrative capacities
The Ministry of Transport - Department of Rail and Intermodal Transport currently does not employ a
single officer to be engaged in this field. The Ministry of Transport will in the future period from 2014 to
2016, in accordance with the policy of strengthening the institutional capacities, provide a number of em-
ployees in this area, too.
Measures planned for the period 2014-2016
The Ministry of Transport, in cooperation with the Ministry of Construction and Urban Planning, the
Directorate of Railways and other relevant institutions will in a planned period draft the Law on cable cars
whereby Directive 2000/9/EC of the European Parliament and of the Council of 20/3/2000 in relation with
the installation of cable cars designed for the transportation of people will be transposed.

3.1.3.13. Construction Products


Overview
In the field of construction products Serbian legislation is not harmonised with European, i.e. only
certain technical regulations have been adopted, such as the Rulebook on technical and other requirements
for reinforced steel and the Rulebook on technical and other requirements for cold-formed welded hollow
profiles of non-alloy steel and fine grain steel structures and a Draft Rulebook on cement undergoing pub-
lishing process.
Priorities for 2013 with regard to harmonisation of legislation
In 2013 it is planned to transpose Regulation (EU) 305/2011 i.e. the development and adoption of the
Regulation on construction products, with prior amendment of the Law on Planning and Construction, whose

158
amending is planned until July 2013. The harmonisation of Regulation will depend on plans regarding the
economy of the Republic of Serbia, because in a working group for transposition of the Regulation there will
be representatives of manufacturers of construction products.
Administrative capacities
Within the Ministry of Construction and Urban Planning, Department of Civil Engineering and Land,
a Division of energy efficiency and construction products has been formed within which there is a Construc-
tion Products Group, where five employees with higher education are provided. Now there are two employ-
ees and their educational profile in the field of construction products is sufficient for organizing and
monitoring of drawing up the Construction Products Regulation, but for the implementation of the Regula-
tion, drafting the bylaws and enforcement of regulations the administrative capacities should be strength-
ened, or three more persons should be employed.
Measures planned for the period 2014-2016
Activities are planned on drafting by-laws and technical regulations under the Construction Products
Regulation, as well as programs and projects of implementation of regulations in the field of construction
products.

3.1.3.14. Packaging and packaging waste


This area is covered within Item 3.27.4. Waste management.

3.1.3.15. Personal protective equipment


Overview
Adoption of technical regulations in the field of personal protective equipment (PPE) is the compe-
tence of MFE.
Rulebook on Personal Protective Equipment was published on 29/12/2011 in the Official Gazette of
RS, No 100/11, entered into force on 6/1/2012, and shall apply from 1/1/2013. The Rulebook is harmonised
with all the principles and relevant requirements of Directive 89/686/EEC, as well as its modifications of
Directive 93/68/EEC, Directive 93/95/EEC and Directive 96/58/EEC. When drafting this Rulebook, besides
the said EU directives, solutions from the reference EU regulations in the field of technical legislation were
taken into consideration, especially from Decision No 768/2008 of the European Parliament and the Council
on a common framework for trading in the products.
The Rulebook is accompanied by a list of Serbian standards in the field of PPE which was published
in the Official Gazette of RS, No 10/12. This list will be regularly updated in accordance with the list of
harmonised standards published in the EU Official Journal.
In 2013 no legislative actions are planned in this area.
Administrative capacities
Transposition and implementation of Directive 89/686/EEC are under the authority of MFE - Quality
Infrastructure Department. Within this Department, Division of Technical Regulations and Conformity As-
sessment has a total of eight employees, three of which, engaged in the Group for technical regulations,
cover a total of 7 regulations whereby European new approach directives (including the Directive
89/686/EEC) have been transposed and 3 planned regulations whereby European old approach directives will
be transposed.
Measures planned for the period 2014-2016
Planned activities in this area will focus on the establishment of permanent mutual cooperation be-
tween competent ministries to adopt regulations, the ministry to apply the regulations, ISS, ATS, conformity
assessment bodies, as well as economic operators and consumers affected by the regulations applied, with a
view to implementing activities to improve the conformity assessment infrastructure and monitoring the im-
plementation of a new framework for placing these products on the market.
Further, monitoring and harmonisation of national legislation with EU legislation in the field of per-
sonal protective equipment will be continued (in case of EU legislation changes), and it is planned to trans-
pose the total number of harmonised standards and training for the full implementation of Rulebook.

159
3.1.4 Procedural Issues
Overview
A Regulation on the application procedure and method of information relating to technical regulations,
standards and conformity assessment (Official Gazette of RS, No 45/10) is fully harmonised with Directive
98/34/EC as amended by Directive 98/48/EC, which lay down the procedure for providing information in the
field of technical regulations and standards and rules on information society services, adopted to prevent
creation of barriers to trade in the single market of EU.
The aim of the Regulation is to ensure effective implementation of Agreement on Technical Barriers
to Trade of WTO (TBT Agreement) and the regional CEFTA agreement where within CEFTA region the
work is intensified on establishing a system of disclosure and processing of foreign notifications of draft
technical regulations of other countries (defining procedures for processing international notification, their
possible translation, submission of relevant ministries, chambers of commerce, associations, manufacturers,
collecting comments and taking a national position on a notified technical regulation).
In early 2012, within CEFTA, a process of reporting national technical regulations in the preparation
phase was initiated (a total of 6 reported draft technical regulations in the RS in 2012).
In accordance with the Law on Technical Requirements for Products and Conformity Assessment,
MFE has established an Information Centre which is responsible for providing information on technical
regulations and related conformity assessment procedures, and reporting on technical regulations in the
preparation phase in accordance with the rules of WTO, CEFTA and Directive 98/34/EC. On the day of en-
try into the WTO and the EU, the Information Centre will be fully operational in terms of reporting of tech-
nical regulations in the pipeline.
An applied software called TEHNIS consisting of electronic databases and Internet portals
(www.tehnis.mfp.gov.rs) has been developed, promoting the work of Information centre for technical regula-
tions, both in terms of information and reporting of technical regulations in the pipeline.
In accordance with the Rulebook on the content and method of keeping registers related to technical
regulations (Official Gazette of RS, No 33/10) in electronic form, as a public record, a register is being kept
of technical regulations, technical regulations in preparation, designated conformity assessment bodies and a
register of recognized international certificates of conformity.
Administrative capacities
Information Centre responsible for providing information on technical regulations, as well as reporting
on the preparation of technical regulations (TBT Enquiry Point), was established in the Section of registers,
projects and cooperation with international organizations, Infrastructure Department of the MFE and there
are two employees who, in addition to other tasks, perform tasks related to information and notification (ap-
proximately one third of the working hours).
With an aim of being fully operational on the date of entry into the WTO and the EU, it is forseen to
form a separate organizational unit in the Information Centre in which one employee would be responsible
for reporting on technical regulations to the WTO or the implementation of Directive 98/34/EC.
Measures to implement the priorities in 2013
In 2013 it is planned to improve the work of the Information Centre by application software innova-
tion and establishing internal procedures for reporting and management of foreign notifications. It is also
planed to further educate staff at the MFE Information Centre, as well as employees of other agencies who
prepare and implement technical regulations.
Measures planned for the period 2014-2016
It is planned to review the existing Regulation in terms of harmonisation with Regulation (EC)
1025/2012, whereby the provisions of Directive 98/34/EC concerning the reporting of standards are
amended.
For effective enforcement of regulations relating to the reporting of technical regulations in the prepa-
ration phase, training will be needed for all the authorities involved in drafting and adoption of technical
regulations.

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3.2. Freedom of movement for workers
3.2.1. Access to labour market
Overview
Freedom of movement for workers is regulated by Regulation No 1612/68 of the Council of 15 Octo-
ber 1968 within the EU, as amended by the new Directive 2004/38/EC of the European Parliament and of the
Council of 29 April 2004.
The obligations that the Republic of Serbia has assumed by the membership in the Council of Europe
and ratification of the Revised European Social Charter (RESC) on 29 May 2009 and its coming into force
on 01/11/2009, are in some elements consistent with the commitments that the state will have by the mem-
bership in the EU. This refers in particular to Article 19 of the Charter, which the Republic of Serbia ac-
cepted almost in its entirety, which refers to the right of migrant workers and their families to protection and
assistance, and contains provisions on prohibiting discrimination against migrant workers on the basis of
citizenship. The first report on the implementation of the amended Revised European Social Charter was
submitted to the Council of Europe in October 2011.
The area of employment and work of foreigners is regulated by the state Law on conditions for the
employment of foreign nationals (Official Journal of SFRY, No 11/78 and 64/89; Official Journal of FRY,
No 42/92). In accordance with this Law, foreign nationals may be employed if they have a permit for perma-
nent residence or temporary residence in the Republic of Serbia, and if they get approval for employment.
Foreign nationals may be employed with an organization or employer, without the approval of employment
and without public announcement, if they have a permit for temporary or permanent residence in the Repub-
lic of Serbia, and if they are employed to perform professional duties stipulated by the business and technical
cooperation contract, long-term production cooperation, technology transfer and foreign investment.
According to the Law on Employment and Unemployment Insurance (Official Gazette of RS, No
36/09 and 88/10) mediation for employment abroad and ensuring the protection of persons in employment
procedures performed abroad, the National Employment Service and private employment agencies that pro-
vide information about the possibilities and conditions for employment abroad, working and living condi-
tions, rights and obligations at work, the forms and means of protection in accordance with the contract of
employment abroad, as well as the rights upon return from work abroad, are in compliance with the law.
The Law on Labour is applicable to the rights, obligations and responsibilities of employment of
foreign nationals and stateless persons who are employed by an employer in the territory of the Republic of
Serbia, so that foreign nationals are equated with nationals as regards remuneration (salary) and work condi-
tions and the right to trade union membership and exercising their rights under the collective agreement.
By adopting the Law on Migration Management (Off. Gazette of RS, No 107/12) in November 2012
in the Republic of Serbia a unique system for managing migration was established, which involves collecting
and analyzing the data, creating a unified system for collecting, organizing and exchange of data, identifying
and proposing priorities of migration policy, proposing and taking measures for its implementation and coor-
dination of the state administration authorities involved in migration management. Regular reporting on the
situation in the field of migration management and regular monitoring the implementation of migration pol-
icy will contribute to the creation of a common policy in this field, in which the lack of coordination between
relevant institutions is perceived as one of the problems in the Progress Report of Serbia in 2012.
In the process of recognition of foreign higher education qualifications, the holder is determined the
right in terms of continuing education, or in respect of employment and is the responsibility of individual
institutions of higher education. The process is prescribed by the Law on Higher Education (Official Ga-
zette of RS, No 76/2005, 100/2007, 97/2008, 44/2010 and 93/2012).
Administrative capacities
The recognition of foreign school certificates of acquired primary and secondary education is the re-
sponsibility of the Ministry of Education, Science and Technological Development.
Professional and other tasks referring to the migration management which is laid down by the Law on
migration management and related administrative tasks, are performed by the Commissioner for refugees
and migration, as well as the Coordinating body for monitoring and management of migration, whose task is
to direct activities related to monitoring and migration management.

161
The area of employment is the responsibility of the Ministry of Labour, Employment and Social Pol-
icy, the National Employment Service and private agencies that are mediators in employment.
On migration and employment abroad tasks within the Employment Department of the Ministry of
Labour, Employment and Social Policy, one executive post is systematized for migrations and one executive
post is systematized for monitoring of employment agencies. A certain number of employees in Department
of employment that are assigned to other tasks are included in the educational training in the field of move-
ment of workers.
The Directorate of National Employment Service, within the Department for implementation of inter-
state agreements and compensation, activities are performed to protect citizens who are employed abroad and
employ foreign nationals and on these tasks five employees are engaged. In National Employment branch
offices, mediation in employment abroad and employment of foreign nationals are performed by employ-
ment advisers.
As part of the National Employment Service the migration service centres, in Belgrade, Nis, Novi
Pazar, Novi Sad, Kraljevo, Krusevac and Bor are open. In these centres staff - advisers in migration service
centres are trained to work in order to provide information, advice and guidance to migrants and potential
migrants about the risks of illegal migration and employment opportunities at home and abroad within the
legal migrations, to reduce the risk of illegal migration.
In Serbia, there are currently 56 private employment agencies. Monitoring of the work of National
Employment Service and employment agencies is conducted by the Ministry of Labour, Employment and
Social Policy.
Priorities for 2013 with regard to harmonisation of legislation
In the fourth quarter of 2013 the priority in respect of harmonizing legislation in the field of access to
the labour market will be the adoption of a new Law on Employment of Foreigners.
The new law on employment of foreigners shall be harmonised with Directive 2004/38/EC on the
right of EU citizens and their family members to move and reside freely within the territory of a Member
State and Regulation 492/2011 on freedom of movement for workers, including allowing nationals of mem-
ber states free access to the labour market in the Republic of Serbia. Measures that comply with Directive
2004/38/EC and Regulation 492/2011, shall apply only to citizens of EU member states, and that only when
the Republic of Serbia becomes a full member of the European Union. Also, by this new law partial har-
monisation will be achieved with EU directives that are primarily related to the movement and residence of
foreigners, however, they are partly linked to the employment opportunities and ensuring the right to work
under the right conditions (Directive No 2003/109/C, 2004/81/EC, 2001/55/EC, 2003/9/EC, 2004/83/EC,
2009/52/EC, and 2004/114/EC).
A series of activities will be undertaken aiming at strengthening the institutional capacities for future
participation of the National Employment Service in the EURES.
During 2013 by-laws will be passed that will allow the implementation of the migration management
and through which the legal framework will be further harmonised with Regulation (EC) No 862/2007 of the
European Parliament and of the Council of 11 July 2007 on the statistics of the Community of migrations
and international protection and on the repealing of the Council Regulation (EEC) No 311/76 on compiling
statistics on foreign workers. Upon the adoption of bylaws, the construction of integrated information sys-
tems will be continued.
Secondary education, as part of a single system, is regulated by the Law on Secondary Education ex-
pected to be adopted in 2013. The draft law stipulates that the acquisition of secondary general, vocational
and arts education is provided to all citizens under equal conditions - among other things, foreign citizens
and stateless persons. Unlike the previous solution, this draft provides that with the recognition a foreign
school certificate is equalized with its corresponding public document acquired in the Republic of Serbia,
regardless of whether the recognition is required for further education or employment.
Measures planned for the period 2014-2016
During the next three years it is expected to work on completing the legislative framework through the
adoption of bylaws for the implementation of the new Law on Employment of Foreigners.

162
Obligations under the Stabilisation and Association Agreement and the Interim Trade
Agreement
Title V of SAA regulates movement of workers, business establishment, supply of services, movement
of capital where there are bases for regulation of the position of workers and their families, access to profes-
sional development, business establishment, the status of companies and their operations, movement of key
personnel and natural persons providing services. SAA expressly provides the obligation that within the
agreed deadlines national legislation shall be harmonised with the rules that belong to the acquis of the
European Communities. (More details on the measures in the section the Review of priorities for 2013 with
regard to legislative harmonisation).

3.2.2. Coordination of social security systems


Overview
Under the coordination of social security systems in the Republic of Serbia, social insurance includes
pension and disability insurance, health insurance, unemployment insurance, and in a broader sense, the right
to child allowance, and all social security branches covered by the essential requirements of the European
Union (Council Regulation No 883/2004 on the coordination of national social security systems in the EU,
Council Regulation No 987/2009 for the implementation of Regulation 987/2009).
The legal framework of social insurance within the free movement of workers is represented by bilat-
eral agreements on social security, which coordinate the social security systems. In addition, the Law on
Health Care has provided health care to foreigners who are permanent residents or temporary residents or
passing through the territory of the Republic of Serbia (for the nationals of countries that have not signed
bilateral agreements on social insurance).
The Republic of Serbia is implementing social security agreements with 28 countries, of which 18
countries are from the European Union (Austria, Cyprus, Slovakia, Great Britain, Luxembourg, France,
Hungary, Denmark, Bulgaria, Czech Republic, Italy, Germany, Sweden, Slovenia, the Netherlands, Poland,
Belgium, Romania).
Most of these contracts were concluded during the existence of Yugoslavia and the Republic of Serbia
as the successor state applies them in relation to international treaties. Certain contracts (older conventions
concluded by the former Yugoslavia) are based on the principle of citizenship, i.e. shall apply to nationals of
the Contracting States and their family members. All contracts signed in the last 20 years are based on the
principle of insurance, and shall apply to all persons who are or have been included in the legislation of the
Contracting Party, as well as the family members of such persons. These contracts include the basic Euro-
pean principles and the principles contained in the relevant EU legislation, such as: the principle of aggrega-
tion of insurance periods for exercising the right to social security, equal treatment of citizens of the
Contracting States, the equation of the territory of Contracting States, the principle of conservation of ac-
quired rights, the principle of payment of pensions in the territory of the other Contracting State, the princi-
ple of pro rata temporis - determining the proportionate part of the benefits, and so on.
Within the right to free movement of workers, the basic rules governing the right to social protection
of migrant workers in the Republic of Serbia are the new Law on Social Protection (Off. Gazette RS No
24/2011). Reasons for the adoption of this law are in compliance with international standards and commit-
ments assumed by ratifying international agreements, notably those relating to the guarantee of human rights
and freedoms and the rights of the child in meeting the standards in this field and the Social Security of Citi-
zens, which is the basic regulation in the field of social protection. Secondly, the Law on Financial Support
to Families with Children, which contributes to the overall measures of child welfare and aims to improve
the conditions for satisfying the basic needs of children, such as salary compensation during maternity leave,
absence from work due to child care and the leave for special care for the child, parental allowance, child
allowance, compensation costs of pre-school institutions for children without parental care, reimbursement
of pre-school costs for children with disabilities, reimbursement of expenses for the pre-school children from
disadvantaged families.
Administrative capacities
In terms of coordination of social security systems, the competent authorities are: the Ministry of La-
bour, Employment and Social Policy (in the field of pension and disability insurance, unemployment insur-
ance, maternity and family benefits), the Ministry of Health (for the area of health insurance system).

163
Institutions responsible for the implementation of bilateral agreements on social security are: Republican
Pension and Disability Insurance Fund, National Institute for health insurance and National Employment
Service, as well as the Department of Social Security, act as a liaison body for implementation of bilateral
agreements on social security.
Measures planned for the period 2014-2016
In the future period priorities will be the regulation of relations in the field of social security through
bilateral agreements with EU member states with which relations have not been regulated.
Also, the capacities of relevant authorities and other institutions responsible for further development of
their staff, primarily through getting familiar with the relevant EU regulations will be strengthened. Since
joining the EU will increase the workload for the authorities and institutions due to the coordination of social
security systems with a large number of countries, it will be necessary to increase the number of employees
in these positions.

3.3. Right of establishment and freedom to provide services


3.3.1. Establishment
Overview
The possibility and realization of establishment are regulated by the Law on Companies (RS (Official
Gazette of RS, No 36/11, 99/11) and the Law on the Registration in the Serbian Business Registers
Agency (Official Gazette of RS, No 99/11) whose enforcement started on 1st February 2012, which made the
registration process more efficient, faster and convenient.
In 2012 companies were harmonised in accordance with the provisions of the new Law on companies
as follows: by 30 April for limited liability companies and by 15 July for joint stock companies.
On the day the new Law on companies was enforced, provisions of the Law on Private Entrepreneurs
ceased to apply, except for those related to the partnerships, which ceased to apply on 01.01.2013. Owners of
existing partnerships are bound to change their form of activity into the legal form of company, and if they
fail to do it until 01.03.2013, they will be transferred into a form a partnership by the the registry officer.
The registration procedure is carried out within the one-stop registration system, which was success-
fully established in the Business Registers Agency in 2009, which enabled economic operators to receive a
unique identification number, a taxpayer identification number (TIN), as well as an application to the appro-
priate social and health insurance funds, while registering the establishment, which is carried out within the
two days from the registry application received date,. The personal identification number for the newly es-
tablished economic operators is granted by the Statistical Office of the Republic of Serbia and is incorpo-
rated in the Decision on registration of the Business Registers Agency. From 1st October 2012, companies no
longer have the obligation of paying the fee for obtaining this number, which was around 11 euros.
The new Law on companies has introduced a number of innovations in accordance with the directives
of EU company law, such as the suspension of payment of registration fee, which has further facilitated the
process of establishment.
Priorities for 2013 with regard to harmonisation of legislation
During 2013 no legislative activities are expected in the field of company law, and further activities
will refer to the enforcement of existing regulations.
Administrative capacities
Administrative capacities of the Business Registers Agency have not been changed, there are about
370 employees engaged in the activities of registration and management of 14 registers. Administrative ca-
pacities of the Ministry of Finance and Economy in the field are given in Chapter 6.
Measures to implement the priorities in 2013
As no legislative activity is planned during 2013, no measures for the implementation of priorities
have been planned.

164
Measures planned for the period 2014-2016
For the period 2014- 2016 in the Business Registers Agency it is planned to further improve the regis-
tration process, the establishment of new registers (Register of Institutions, Register of disqualified persons,
Register of agricultural agreements on financing), as well as to improve the technical requirements for im-
provement of electronic services, which will, together with the current legislation in this field, contribute to
further removal of barriers while starting commercial practice and establishing a more favourable business
environment.
During this period, the electronic registration process is expected to become operational, as it is now
conditioned by the full implementation of electronic signature certification process, which has been carried
out for a small number of economic operators, followed by the establishment of a system that will allow the
collection of fees for electronic registration, as the Agency is not a budget beneficiary, but it gets revenue
from fees for services provided in the registration process, as well as from the regulations which will regulate
archiving of electronic documents. Currently, the Law on Registration stipulates that the Business Registers
Agency has the possibility of submitting electronic applications via client application in order to receive
electronic documents and the proof of payment of fees, which are not yet in operation, precisely for the said
reasons. By regulating the above mentioned issues by the competent authority it will be possible to conduct
the electronic registration, which is expected in the period 2014-2016.
Obligations under the Stabilisation and Association Agreement and the Interim Trade
Agreement
With the adoption of the Law on companies were fulfilled the obligations of Chapter II of the Stabili-
sation and Association Agreement, the Establishment, Articles 52-56, which stipulates that the domestic and
foreign natural and legal persons may establish companies and branches in the Republic of Serbia under the
same conditions. The law is completely drawn up in accordance with the directives on companies, which
means that the possibility of establishment of a company is regulated in the same way for both domestic and
foreign natural and legal persons.

3.3.2. Freedom to provide cross-border services


Overview
The area of freedom to provide services is not regulated by a separate act, but by the Departmental leg-
islation, which means that no roof legislation exists in this area. The scope of the Ministry of Foreign and
Internal Trade and Telecommunications from the aspect of freedom to provide services is governed by the
following regulations:
- Law on Trade (Official Gazette of RS, 32/93, 50/93, 41/94, 29/96, 37/2002; (Official Gazette of
RS, 85/2005, 101/2005 and 53/2010).
- Law on Consumer Protection (Official Gazette of RS, No 79/2005 and 73/2010).
- Law on Electronic Commerce (Official Gazette of RS, No 41/2009).
- Law on Protection of Competition (Official Gazette of RS, No 51/2009).
- Law on Foreign Trade in Weapons, Military Equipment and Dual-Use Goods (Official Gazette of
Serbia and Montenegro, Nos 7/05 and 8/05)
- Law on Foreign Trade (Official Gazette of RS, No 88/11)
- Regulations in the field of telecommunications:
- Law on Electronic Communications (Official Gazette of RS, No 44/2010)
- Law on Postal Services (Official Gazette of RS, No 44/2010)
In addition, in each area there is a number of regulations governing the various types of services.
In the field of foreign trade, until the adoption of a new law, the Law on Foreign Trade in Weapons,
Military Equipment and Dual-Use Goods is in force (Official Gazette of Serbia and Montenegro, No 7/05
and 8/05). As noted in Chapter 30, the Government has adopted a National control list of weapons and mili-
tary equipment of the Republic of Serbia (Official Gazette of RS, No 112/12). In the process of issuing li-
cences for conducting foreign trade in controlled goods and the Decision on the criteria for the issuance of
licences for the export of arms, military equipment and dual-use goods is applied (Official Gazette of Serbia
and Montenegro, No 11/2005). Rulebook on keeping register of persons who may perform foreign trade in

165
controlled goods (Official Gazette of Serbia, No 12/2005, Official Gazette of RS, No 73/2006, 96/2007 and
80/2012) and Rulebook on the application form for a licence, the licence application form and other forms
accompanying the foreign trade in controlled goods are in force in this area(Official Gazette of RS, No
96/2007 and 80/2012);
Amendments to the Law on Foreign Trade (Official Gazette of RS, No 88/11) adopted by the National
Assembly of the Republic of Serbia in November 2011, whose enforcement started on 01 February 2012, a
more precise definition of the term persons in foreign trade was given and it includes, in addition to legal
persons, entrepreneur and natural persons, the branches of domestic and foreign legal persons which are
given equal rights to engage in foreign trade. In accordance with the recommendations of the European
Commission, it is emphasized that the same treatment is given to domestic and foreign persons. Under the
amendments to the Law, persons in foreign trade can provide services in accordance with their capacity to
act (which is regulated by the Law on Companies).
Amendments to the Law on Foreign Trade (Official Gazette of RS, No 88/11) supplemented by Arti-
cles 6 and 7 which define the principles of foreign trade in the part related to services. In Part V of the Law,
which relates to foreign trade services, Article 27 states that trading of services shall be performed in accor-
dance with the law, international treaties and obligations assumed by the Republic of Serbia and that the pro-
vision of services by Serbian nationals in another country or customs territory is free. The same article also
states that in the territory of Republic of Serbia, foreign entities shall provide services in accordance with the
regulations governing the provision of certain types of services.
In the field of social protection, Article 10 of the Law on Social Protection (Official Gazette of RS,
No 24/11), subtitled The establishment of social protection, stipulates that the social welfare institutions are
established to exercise the rights in the field of social protection and the provision of social services, as well
as to carry out development, advisory, research and other professional activities in social protection and to
achieve other legally defined interests. A social protection institution may be established by the Republic of
Serbia, autonomous province, local authorities and other legal and natural persons. Centre for Social Work
can be established only by a local self-government unit, and Institute of Social Welfare and Institution for the
Education of Children and Youth can be established only by the Republic of Serbia and/or the autonomous
provinces.
Detailed information on the review of the situation in the field of culture and information (media) see
in Chapter 10.
In the veterinary field, for harmonisation, preparation, adoption and implementation of the Law on
Veterinary(Official Gazette of RS, No 91/2005, 30/2010 and 93/2012), as well as for other laws governing
veterinary and food safety and regulations adopted pursuant thereto, the relevant Ministry of Agriculture,
Forestry and Water Managemenet , Veterinary Administration is competent. Before starting activities legal
entities and entrepreneurs engaged in veterinary work must obtain, a decision on eligibility for this activity
from the Veterinary Administration of Ministry of Agriculture, Forestry and Water Management, in accor-
dance with the special regulations governing specific areas, by type of activity that are being carried out in
them.
Law on Veterinary regulates the conditions for veterinary services in Serbia. Veterinary activity can be
carried out by a legal entity registered in the Company Register and registered in the Register of Legal Enti-
ties for veterinary services (Rulebook on keeping the register of legal entities for carrying out veterinary ac-
tivities and registry of entrepreneurs that perform veterinary activities - (Official Gazette of RS, No 11/08) of
the Ministry of Agriculture, Forestry and Water Management. A legal entity is established as veterinary am-
bulance, veterinary station, veterinary clinic (Rulebook on conditions in terms of facilities, equipment and
capital equipment, as well as for professional staff to be met by a legal entity for veterinary services per-
formance (Official Gazette of RS, No 42/2006) veterinary pharmacy, (Rulebook on conditions in terms of
facilities, equipment, capital equipment, as well as for professional staff to be met by veterinary pharmacy
(Official Gazette of RS, No 91/2009) centre for animal reproduction and artificial insemination (Rulebook on
conditions in terms of facilities, equipment and capital equipment, as well as the conditions for professional
staff to be met for a centre for animal reproduction and artificial insemination - (Official Gazette of RS, No
8/08) and laboratories, and operate under the regulations on companies. Legal entity (Regulation on condi-
tions in terms of facilities, equipment and capital equipment, as well as for professional staff to be met by the
legal entity to carry out veterinary activities - (Official Gazette of RS, No 42/06) mentioned above shall be
entered in the Register if the requirements for professional staff, premises (building), technical requirements,
and proper equipment are met. Certain activities within the framework of veterinary activities may be per-

166
formed by a specialist veterinary institute, veterinary institute, National reference laboratory for highly dan-
gerous infectious diseases from the list of OIE and higher education institutions and higher education units
concerned with the education of veterinarians. A legal entity engaged in the breeding of livestock and live-
stock production may need to establish their own livestock veterinary service as a veterinary clinic with the
status of a legal entity. Veterinary jobs in veterinary legal entities may be carried out only by vets (veteri-
narians and veterinary graduates) who have licence-permit for veterinary services. The licence is issued by
the Veterinary Chamber of Serbia for a period of five years. Detailed requirements and procedures for the
issuance, renewal and revocation of the licence are prescribed by the Statute of Chamber and the Law on
Veterinary (Official Gazette of RS, No 91/05). Conditions for obtaining the licence are the university di-
ploma in veterinary medicine and the state licence exam passed. Provision of services is not fully harmonised
with EU rules.
In the field of tourism, the procedure of obtaining a licence for tour operator is regulated by Law on
registration in the Business Registers Agency (Official Gazette of RS, No 99/2011), the Law on Tourism
(Official Gazette of RS, No 36/2009, 88 / 2010, 99/2011-st. law and 93/2012) and Rulebook on the content
of applications for issuing the solemn forms of licences for organization and realization of tourist travels in
the country and abroad (Official Gazette of RS, No 55/2012). The licence for organizing tourist travels at the
request of the applicant is issued by the Registrar of tourism, by Decision for a period of 3 years, which is
finite and based on which the tour operator is registered in the Register of tourism.
If all legal requirements for registration have been met, the Registrar shall, within five days from the
date of filing the application for registration, adopt a decision whereby the request from the application for
registration shall be adopted and the registration carried out without delay in the Register.
The Law on Tourism stipulates that the tour operator may perform the organization and realization of
tourist travel within the country and abroad, as well as organize and realize students travelling abroad to
learn a foreign language or for vocational training with the possibility of performing temporary jobs if they
meet the requirements prescribed by law and have a licence to perform these tasks.
The Rulebook on travel guarantees on the type and conditions of travel guarantees, the way how to ac-
tivate and other conditions to be met by tour operator depending on the type of organized tours (Official Ga-
zette of RS, No 50/2012) closer prescribes travel guarantee conditions in the event of insolvency of the tour
operator and travel guarantee as insurance for damages caused to passengers by the failure, partial perform-
ance or undue performance of obligations of the tour, which are determined by general terms and travel pro-
gram. In order to achieve the maximum protection of passengers, but also to create a more favourable
environment for tour operators, the Ministry is working on a continuous monitoring of good European prac-
tices in this area, with the aim of improving regulations.
Articles 94 and 98 of the Law on Tourism are stipulating the conditions a tourist guide, a local tourist
guide and a travel companion must meet in order to offer their services. The cited law and the Rulebook on
the program and the method of taking state licence exam for tourist guides and travel companion (Official
Gazette of RS, No 40/2010 and 55/2012) prescribe the knowledge and skills, and the programme of state
licence exam for tourist guide and travel companion.
An analysis of the tourism market noted an increased need for qualified travel agencies and profes-
sional staff in order to improve the quality of organizing tourist travels. As part of fiscal consolidation, the
reforms of para-fiscal levies, the National Assembly on 25 September 2012 adopted a large number of laws.
In this regard, in 2012 amendments to the Law on Tourism were executed, enabling a large number of
people to take the exam for tourist guides and travel companions without charge in the theoretical part of the
state licence exam and concerning making of ID cards and tags, while the practical part costs of the exam
were greatly reduced. This provided retraining and professional development of a number of persons under
favourable conditions.
In the field of legal services, and with the aim of improving legal profession, as well meeting the
standards of independence, autonomy and self-regularity of advocacy, in 2011 the new Law on Advocacy
was adopted (Official Gazette of RS, No 31/2011 and 24/2012 decision of the Constitutional Court) in
which drawing up participated the Bar Association of Serbia in cooperation with local chambers.
One of the reasons for the adoption of this law is to harmonise the legislative framework of the Repub-
lic of Serbia with international documents that govern the legal profession, such as: the United Nations Basic
Principles on the Role of Lawyers of September 1990, Recommendation P (2000) 21 of the Committee of
Ministers of the Council of Europe on freedom of practicing law of 25 October 2000 and the Standards of
Council of the Bar Associations of Europe. In addition, since the Republic of Serbia is in the process of join-

167
ing the World Trade Organization, where one of the issues of market liberalization is in the services domain,
it was necessary that the law in more detail, in relation to the existing legal solutions, determine the condi-
tions for carrying out the business of providing legal aid in Serbia by lawyers who are foreign nationals. To
this effect, a specific novelty are conditions for the entry of lawyers foreign nationals, namely, Article 14
of the Law provides that a foreign national can enter the lawyers registry in the Republic of Serbia if practic-
ing law in the home country in accordance with the laws of that country, and if, depending on the type of
entry, meets other requirements. These legal provisions have in a completely different way set out conditions
for the performance of the legal profession in the Republic of Serbia for lawyers foreigners compared to the
previous law, because the Principle of reciprocity is abandoned and conditions for foreign lawyers to conduct
legal profession are precisely prescribe by law, which is one of the basic requirements of the World Trade
Organization in the process of Serbia's accession to this organization, in the part concerning the liberalization
of services.
The provisions of Article 37 of the Law on Advocacy, which introduce the obligation to provide law-
yers with professional responsibility, concluding a collective insurance contract, entered into force on 17
May 2012. On the same day, the provisions of the Law governing the bar examination and the constitution of
the Academy entered into force. Provisions of Article 86 of the Law on Advocacy provide for the establish-
ment (by the Bar Association of Serbia) of the Bar Academy, as a separate body responsible for continuous
professional training of lawyers, law clerks, legal practitioners and persons employed in law firms and corpo-
rations, improvement of theoretical and practical knowledge and skills necessary for lawyers for profes-
sional, independent, effective and ethical practice of law, specialization for lawyers and issuance of
certificates of specialization in a particular field of law and advocacy. The establishment, organization and
operation of the Bar Academy are governed by the Statute and other acts of the Serbian Bar Association.
The Rulebook on Bar Association was approved in April 2012 and has entered into force on 01 May 2012.
Priorities for 2013 with regard to harmonisation of legislation
It is provided to amend the Law on Electronic Commerce in the third quarter of 2013, the Law on con-
sumer protection in the fourth quarter of 2013, and the Law on Protection of Competition in the third quarter
of 2013.
In the field of tourism, the regulations comply with European legislation. In order to understand the
best European practices in connection with the travel guarantees (insurance policies, bank guarantees, guar-
antee funds) in late 2012 the German organization GIZ provided a consultant, Professor Volgang Richter.
The consultations are attended by the representatives of Ministry and representatives of associations of travel
agencies (YUTA, ATAS, ANTAS), the association of insurers, banking associations, Serbian Chamber of
Commerce, and representatives of consumer associations, representatives of the Ministry of Foreign and In-
ternal Trade and Telecommunications, which are engaged in the preparation of amendments to the Law on
Consumer Protection.
Detailed information on the review of priorities for 2013 in respect of harmonizing legislation in the
field of foreign trade can be found in Chapter 30, in the field of social protection in Chapter 19, and in the
field of veterinary medicine is in Chapter 12 Food safety, veterinary and phytosanitary policy.
Administrative capacities
In the Ministry of Foreign and Internal Trade and Telecommunications jobs in the field of services are
performed in the Department of Commerce, services, prices, and consumer protection, in which 39 employ-
ees are engaged. The Group for services and a national brand of Serbia, which has 4 employees, is responsi-
ble for the service area. According to a new job classification it is planned to permanently employ one more
employee.
In the field of tourism, tourist inspectors are responsible for monitoring the whole territory of the Re-
public of Serbia and authorized to lodge a complaint to the competent court for the criminal or civil offense,
or submit a request for criminal proceedings when a violation of the law in their jurisdiction is determined,
for which the penalty is prescribed. The Tourist Department employs 99 inspection officers who are organi-
zationally divided into five divisions. The funding is provided from the budget based on the annual operating
plan.
In the field of legal services, provisions of Article 87 of the Law on Advocacy provide taking the bar
exam. The exam consists of checking the knowledge of local and international regulations and legal docu-
ments relating to the legal profession. The program of the bar exam, issuance of certificates of passing the
exam, the way of setting up the Commission for taking the bar exam, the selection of members, the method

168
of work and decision making process of the Commission shall be prescribed by the Statute and other acts of
the Bar Association of Serbia. The Rulebook on bar examination was adopted in April 2012 and entered into
force on 01 May 2012.
Detailed information on the Administrative capacities in the field of foreign trade are available in
Chapter 30 in the field of social protection in Chapter 19, in the field of culture and information (media) in
Chapter 10, and in the veterinary field in Chapter 12.
Implementation of priority measures for 2013
For transposition of the Directive on Services 2006/123/EC a project proposal Development of the
Service Department in the Republic of Serbia is prepared in accordance with EU standards, with which it is
applied for the IPA funds. In the fourth quarter of 2013 a study will be drawn up as a professional basis for
the transposition of the Directive on Services.
Detailed information on the implementation of priority measures in 2013 in the field of foreign trade
see in Chapter 30, in the field of social protection in Chapter 19, in the field of culture and information (me-
dia) in Chapter 10, and in the veterinary field in Chapter 12.
In the field of tourism, the most important events in 2013 are the celebration of the 1700th year of the
Edict of Milan, which will be organized throughout the year all over Serbia, and the 95th Session of the Ex-
ecutive Council of the World Tourism Organization will be held in Belgrade in May 2013 In order to im-
prove the competitiveness of tourism in the Republic of Serbia it is planned to continue with the
harmonisation of legislation to establish legal certainty, ensuring quality standards to protect consumers and
create a positive environment for the overall development of tourism and the promotion of human resources
in the Department of Tourism in line with international standards, especially having regard to the tourist pro-
fessions such as tourist guides, local tourist guides, travel companion, stewards at ski resorts. The same ap-
plies to the harmonisation of standards of the classification of hospitability facilities for accommodation with
the standards adopted by the European Association of hotel workers HOTREC.
The IPA project provides the final proposal of the Revision of tourism development strategy in the
Republic of Serbia until 2015.
Measures planned for the period 2014-2016
It is planned in the Ministry of Foreign and Internal Trade and Telecommunications to draw up the
Law on services for the fourth quarter of 2014, whereby Directive on services 2006/123 will be transposed.
Detailed information on the measures planned for the period 2014-2016 in the field of foreign trade
see in Chapter 30, in the field of social protection in Chapter 19, Culture and Communication (media) in
Chapter 10, and in the veterinary field in Chapter 12.
In the field of tourism, by examining the details of the Report of the World Economic Forum 2011
(World Economic Forum - The Travel And Tourism Competitiveness Report 2011) on the competitiveness of
the tourism industry, it was determined that it is necessary to strengthen the position of the Republic of Ser-
bia in particular in areas where we are at the bottom of the table. Not only is it necessary to raise the level of
quality of infrastructure for air and rail transport and road routes, for which other line ministries are compe-
tent, but the Ministry should also provide more funds in the budget for tourism development. It is also neces-
sary to interest caterers, by information campaign, to categorize their catering accommodation facilities,
encourage the business operations of tourism industry stakeholders over the Internet and initiate a number of
employee trainings in the tourism industry because they are all parameters that affect the competitiveness of
our tourism. In this period it is necessary to adopt a new Tourism Development Strategy.
In the field of legal services, the Ministry of Justice and Public Administration will in the period 2014
- 2016 consider the possibility of adopting amendments to the Law on Advocacy towards full compliance
with the above two directives concerning the practice of the profession of lawyer in a Member State which is
not the one where the qualifications were obtained and/or directives promoting the freedom to provide ser-
vices of lawyers, and in the sense of their implementation in the judicial system of the Republic of Serbia. In
the event that full harmonisation is not possible during this period, due to unequal conditions for conducting
legal services in the territory of the Republic of Serbia by lawyers who have earned the right in some of the
EU member states, at the same time without the right for lawyers registered in Serbia to have the same op-
portunity in EU member states, necessary changes and full compliance with these directives will be carried
out before the admission of Serbia to the EU, which is not in contradiction with European practice, because
the change of legislation in this area of the Republic of Slovenia was conducted immediately prior to admis-
sion to the EU, in order to balance the interests of the profession and the need for association to the EU.

169
Obligations under the Stabilisation and Association Agreement and the Interim Trade
Agreement
With the adoption of the Law on services the obligations of Chapter III of the Stabilisation and Asso-
ciation Agreement, Provision of Services, Articles 59-61., were fulfilled, whereby in a unique for local and
foreign individuals and legal entities was regulated the ability to provide services under the same conditions
Article 61 precisely define conditions of providing transport services.
In the field of culture, in line with the Stabilisation and Association Agreement and the European
Partnership, the top priority of the Ministry of Culture and Information is the acceleration of the process of
harmonisation of laws and regulations under the jurisdiction of the Ministry, with the standards and the EU
acquis. Harmonisation of legislation with the European Union legislation that regulate this area is ongoing.
National regulations are in the process of harmonisation with the Audiovisual Media Services Directive.
In the field of tourism, the provision of the Agreement relating to the normative content of the regula-
tions - Title VIII - Cooperation Policies, Article 96, Tourism. The said Article stipulates that cooperation be-
tween the parties in the field of tourism seeks to strengthen the flow of tourist information (via international
networks, databases, etc.), to foster the development of infrastructure favourable for investments in tourism,
to involve Serbia in important European tourism organizations and to study opportunities for joint activities
and strengthening of cooperation between tourist undertaking, experts and governments and their agencies
responsible for tourism and the transfer of knowledge and experience (know-how) (through training, ex-
changes, seminars). In the cooperation the Community acquis communautaire related to this field will be
taken into account. Cooperation may be integrated into a regional framework of cooperation.
In the field of legal services, the Law on the Advocacyis partially harmonised with the obligations
arising from the relevant regulations of the European Union, as follows:
- Council Directive of 22 March 1977 to facilitate the effective exercise by lawyers of freedom to
provide services (77/249/EEC) (Official Journal L 078, 26/03/1977 P. 0017-0018), CELEX
31977L0249;
- Directive 98/5/EC of the European Parliament and of the Council of 16 February 1998 to Facilitate
the practice of profession of lawyer on a permanent basis in a member state other than that in which
the qualification was obtained (OJ L 77, 14.3.1998), CELEX 31998L0005.
The reason for the partial fulfilment of the obligation is that the full opening of the market for lawyers
from the EU would be contrary to the interests of the local legal profession since the Republic of Serbia is
not a member of the EU, and thus lawyers of the Republic of Serbia cannot perform under the same condi-
tions the lawyer's activity in EU member states.
Review of current and planned foreign development aid
Detailed information on current and planned foreign development assistance in the field of foreign
trade can be found in Chapter 30, in the field of social protection in Chapter 19, in the field of culture and
information (media) in Chapter 10, and in the veterinary field in Chapter 12.

3.3.3. Postal services


Overview
The current Law on Postal Services (Official Gazette of RS, No 18/05 and 30/10) is harmonised with
Directive 97/67/EC.
Priorities for 2013 with regard to harmonisation of legislation
Adoption of the Strategy of development of postal services in Serbia with the Action Plan for the im-
plementation of the Strategy for the period 2013-2016 is planned for the second quarter of 2013.
Administrative capacities
Within the ministry, activities in the field of postal services are performed in the Department for elec-
tronic communications, information society and postal services, and Department for regulatory and adminis-
trative tasks. In this Department a Division for postal services and supervision was formed, comprising:
- Group for inspection (3 full-time employees) and
- Group for planning and development in the field of postal services (4 full-time employees).

170
Measures planned for the period 2014-2016
The above mentioned Action plan for the implementation of the development of postal services in
Serbia defines a timetable for the harmonisation of national legislation with Directive 2002/39/EC (Directive
2002/39/EC of the European Parliament and of the Council of 10 June 2002 amending Directive 97/67 / EC
with regard to the further opening to competition of Community postal services) and 2008/06/EC Directive
(Directive 2008/6/EC of the European Parliament and of the Council of 20 February 2008 amending Direc-
tive 97/67/EC with regard to the full accomplishment of the internal market of Community postal services).
Obligations under the Stabilisation and Association Agreement and the Interim Trade
Agreement
Obligations under title III of the Stabilisation and Association Agreement, Provision of Services, Arti-
cles 59-60, whereby the ability to provide services is under the same conditions in a unique way regulated for
local and foreign individuals and legal entities. .

3.3.4. Mutual recognition of professional qualifications


Overview
The legal framework for the recognition of professional qualifications is still in preparation. The quali-
fication is, by the Draft Law on Adult Education (in the process of preparing for submission to the Govern-
ment), defined as the formal recognition of acquired core and professional competencies stipulated by
standards in accordance with the law. The National Qualifications Framework is still in the preparation
phase. On a general level there is still no understanding of a difference between the acquired level of educa-
tion and qualifications.
The European Union has long since become aware that a restrictive approach in the regulation of pro-
fessional qualifications to the same extent adversely affects the mobility of workforce as discrimination on
ethnic grounds, therefore it initiated a process of harmonisation of minimum requirements in terms of dura-
tion, type of education and work experience, at first for a group of seven professions. The lists were later ex-
panded, because the mobility of professionals is the key element of competitiveness, and the recognition of
qualifications obtained in another state has become one of the main factors of the single market.
Recognition of education acquired abroad is regulated by the laws governing the education system re-
gardless of whether recognition is required in order to continue their education or for the employment. The
procedure of recognition of foreign school certificates is implemented by the Ministry of Education, Science
and Technological Development for the level of primary and secondary education, or by the independent
institutions for higher education level.
However, the authority competent for the qualification recognition can be only the one that prescribes
conditions for conducting activities, establishes programmes for professional examinations and issues work
permits. Since in the division of responsibilities in European Union regulations during the preparation of
NPI, the competence was given to the then Ministry of Education, an interdepartmental working group was
established which prepared a working version of the draft Draft Law on the Process of Recognition of Quali-
fications for Regulated Professions, whereby, in fact, the process of harmonisation with Directive
2005/36/EC of the European Parliament and of the Council of 7 September 2005 on the recognition of pro-
fessional qualifications has started(Text with EEA relevance).
Priorities for 2013 with regard to harmonisation of legislation
The Law on the Recognition of Qualifications for Regulated Professions (harmonisation with Direc-
tive 2005/36/EC on the recognition of professional qualifications - 32005L0036): Fourth Quarter
Administrative capacities
The working version of the Draft Law on the Recognition of Qualifications for Regulated Professions,
to begin with, does not provide for the formation of new institutions. It is provided that the Minister of Edu-
cation shall appoint a national coordinator, that in each line ministry the competent authority for the recogni-
tion shall be formed, within the existing office services, or that these tasks are delegated to the appropriate
institutions. Also, a contact centre will be set up within one year after the entry into force of the Law, and
until then the contact centre tasks will most probably be performed by ENIC Centre of the Ministry of Edu-
cation, Science and Technological Development.

171
Measures to implement the priorities in 2013
The working version of the Draft Law on the Recognition of Qualifications for Regulated Professions
shall cover the general system of recognition and freedom to provide cross-border services, but not the auto-
matic recognition system which includes the recognition of obtained qualifications such as: doctors, dentists,
pharmacists, general registered nurses, midwives, veterinary surgeons and architects due to the lack of coop-
eration with the line ministries which should be involved in the work if they do not vote for the preparation
of special laws. The prepared text will be sent to all ministries for comments, given that it provides new re-
sponsibilities for ministries and it establishes new services in the ministries. Based on the comments and
suggestions of ministries the draft text will be prepared and submitted to the Government in the last quarter
of 2013.
Measures planned for the period 2014-2016
In the period 2014-2016 the system will be upgraded and acts will be harmonised in all areas, whereas
certain services in the ministries will be prepared for the recognition of qualifications with technical support
from the European Commission (training, expert missions).
Obligations under the Stabilisation and Association Agreement and the Interim Trade
Agreement
The Ministry of Education, Science and Technological Development, and all line ministries will con-
tinue to work closely with the European Commission during the work on the harmonisation of regulations
under its authority with the Law on Recognition of Qualifications for Regulated Professions, i.e. Directive
2005/36/EC and preparation of personnel to implement these regulations.

3.4. Free movement of capital


3.4.1. Regime of movement of capital and current payments
Overview
The movement of capital is regulated by the Law on Foreign Exchange Operations (Official Gazette
of RS, No 62/2006, 31/2011 and 119/2012).
The Law on Foreign Exchange Operations accepted the principle of gradual liberalisation of capital
movements and in this sense long-term capital operations were liberalised, deposit operations of residents
were partially liberalised, and the limitations were prescribed for the short-term capital operations.
The Law on Foreign Exchange Operations and by-laws arising therefrom liberalised the following
capital transactions:
- direct investments of residents abroad and of non-residents in the Republic of Serbia,
- equity portfolio investment by residents abroad in equity securities that are not direct investments,
as well as in long-term debt securities, that is carried out in accordance with the law and by-law of
the National Bank of Serbia,
- transactions with financial derivatives between residents and non-residents that are in conformity
with by-law of the National Bank of Serbia,
- credit borrowing by residents taking commercial and financial loans for import of goods and execu-
tion of capital projects abroad, and financial loans for other purposes in accordance with the by-law
of the National Bank of Serbia,
- dinar loans between residents and non-residents in accordance with the law and by-law of the Na-
tional Bank of Serbia,
- clearing debts or claims on foreign credit transactions in the manner prescribed by the National
Bank of Serbia.
Deposit activities of residents abroad are partially liberalised - banks are free to hold foreign currency
in banks abroad, and other residents may hold them in accordance with the by-law of the National Bank of
Serbia. According to this regulation, certain categories of individuals are free to hold foreign currency in
bank accounts abroad, and legal entities are subject to the approval of the National Bank of Serbia to perform
certain activities abroad.

172
The Law on Foreign Exchange Operations retained the restrictions in terms of investments by resi-
dents in foreign short-term securities and non-residents in short-term securities in the Republic of Serbia.
This restriction does not apply to banks that perform those activities under the conditions prescribed by the
National Bank of Serbia, nor to domestic investment and voluntary pension funds and insurance companies,
that perform this type of investment in accordance with the laws governing their operations.
In the part of lending operations, the restriction that refers to the use of short-term financial loans from
abroad for the purposes established by the National Bank of Serbia was retained. Also, the resident legal
entity may grant financial loan only to a non-resident which is majority owned by the resident lender, with
the obligation to obtain collateral from abroad.The Law amending the Law on Foreign Exchange Operations
was passed in 2012 (Official Gazette of RS, No 119/2012), which entered into force on 25 December 2012.
The Law amending the Law on Foreign Exchange Operations further liberalised capital transactions, which
is reflected in the following:
- it made it possible for residents both individuals living abroad and those that were branches of
foreign legal entities with a parent legal entity, to take credits with a repayment period of over one
year,
- resident legal entity may grant a financial loan to a non-resident that is majority-owned by the
lender, without the condition that the loan is approved from the profit that the resident makes
through business operations abroad,
- the law introduced the possibility that the branches of foreign legal persons offset debts and claims
with regard to credit transactions in foreign currency,
- it introduced purchase of receivables and payables between residents and non-residents arising
from international credit operations,
- methodological harmonisation of classification of foreign credit operations with the European Un-
ion was made.
Priorities for 2013 with regard to harmonisation of legislation
Bearing in mind that the Law amending the Law on Foreign Exchange Operations came into force at
the end of December 2012, further adjustment with the European Union regulations that regulate the move-
ment of capital is not planned during 2013, but these regulations will continue to be followed.
Administrative capacities
The Ministry of Economy and Finance as authorised proposer of the Law on Foreign Exchange Opera-
tions prepares that law in cooperation with the National Bank of Serbia. By-laws for implementation of the
Law on Foreign Exchange Operations are passed by the RS Government at the proposal of the Ministry of
Finance and Economy and the National Bank of Serbia. In order to strengthen the administrative capacity of
the Ministry of Finance and Economy and the National Bank of Serbia in the area of movement of capital,
further development of employees is conducted through various forms of technical assistance and coopera-
tion with countries in the region and the European Union.
Measures planned for the period 2014-2016
Under the Stabilisation and Association Agreement between the European Community and its Mem-
ber States of the one part, and the Republic of Serbia, of the other part (SAA), which was signed on 29 April
2008, during the first four years following the date of entry into force of this Agreement, Serbia has commit-
ted to take measures permitting the creation of the necessary conditions for the further gradual application of
Community rules on the free movement of capital (Article 64 of SAA). The Law on Foreign Exchange Op-
erations will during that time be harmonised with Directive 88/361/EEC, which regulates the area of capital
movements Council Directive 88/361/EEC for implementation of Article 67 of the Treaty of 24 June 1988.
Obligations under the Stabilisation and Association Agreement and the Interim
Agreement
The SAA (Title V, Chapter IV: Current payments and movement of capital) contains the framework
for regulating the movement of capital and current payments. By signing the agreement Serbia has commit-
ted to ensure, as from four years after the entry into force of this Agreement, free movement of capital relat-
ing to portfolio investment and financial loans and credits with maturity shorter than a year, and will not

173
introduce any new restrictions on the movement of capital and current payments between residents of the
Community and Serbia and will not make the existing arrangements more restrictive (Article 63 of the SAA).
Overview of current and planned foreign development aid
On 1 February 2011, the National Bank of Serbia began the implementation of the programme of
technical assistance of the European Central Bank, "Strengthening the institutional capacity of the National
Bank of Serbia", which is funded by the European Union pre-accession assistance (IPA) and which ends on 1
February 2013. Within the project field Liberalisation of capital movements, representatives of the National
Bank of Serbia, together with representatives of the central banks of Austria and Cyprus, who are involved in
the project, prepared a strategy for the liberalisation of capital movements, in the part that is under the juris-
diction of the National Bank of Serbia.

3.4.2. The payment system


Overview
The legislative framework in the area of payment systems in the Republic of Serbia is the Law on the
National Bank of Serbia (Official Gazette of RS, No 72/2003, 55/2004, 85/2005 other law, 44/2010,
76/2012 and 106/2012), the Law on Payment Transactions (Official Gazette of FRY, 3/2002, 5/2003, and
Official Gazette of RS, No 43/2004, 62/2006, 111/2009 other law 31/2011) and the Law on Foreign Ex-
change Operations (Official Gazette of RS, No 62/2006 and 31/2011), as well as the by-laws made under
these laws.
The Law on the National Bank of Serbia prescribes that the National Bank of Serbia shall regulate,
control and promote the safe functioning of the payment system in the country and in international transac-
tions, in compliance with the law.
The payment system in the country is regulated by the Law on Payment Transactions and by-laws aris-
ing from this law. This law regulates the payment transactions, and the rights and obligations of banks and
customers. The Law on Payment Transactions and the by-laws that the National Bank of Serbia passed on
basis of the authority arising from that law (Decision on the Form, Contents and Use of Uniform Instruments
in Payment Transactions , Decision on Conditions and Manner of Opening, Maintaining and Closing Bank
Accounts, Decision on Further Details on Granting and Withdrawing Bank Licenses for Payment Transac-
tions, etc.) have been partially harmonised with Directive on payment services in the internal market
2007/64/EC (Directive 2007/64/EC of the European Parliament and of the Council of 13 November 2007 on
payment services in the internal market amending Directives 97/7/EC, 2002/65/EC, 2005/60/EC and
2006/48/EC and repealing Directive 97/5/EC).
The field of international payment transactions is regulated by the Law on Foreign Exchange Opera-
tions, as well as by-laws passed by the National Bank of Serbia issued under the authority arising from that
law (Decision on Terms and Conditions of International Payment Transactions, Instruction on the Implemen-
tation of the Decision on Terms and Conditions of International Payment Transactions, Decision on Unique
Structure for Identification and Classification of Accounts within Plan of Accounts for Payment Transactions
for the Implementation of International Rules and IBAN Standards, Decision on the Conditions of Opening
and Maintaining Accounts of Non-Residents, Decision on the Conditions of Opening and Maintaining For-
eign Currency Accounts of Residents, etc.).
In 2012, the draft law on payment services and the draft law on settlement finality in payment and se-
curities settlement systems, which were published on the website of the National Bank of Serbia. As for the
draft law on payment services, changes of some of its provisions are underway in order to comply with the
objections and suggestions received from the bank, the Serbian Chamber of Commerce and other relevant
subjects.
The matter regulated by the draft law on settlement finality in payment and securities settlement sys-
tems has not been legally regulated in the Republic of Serbia, and under this law, payment systems will be
required to determine the finality of settlement in the case of initiating the proceedings against a participant
because of inability to settle obligations. The draft law on settlement finality in payment and securities set-
tlement systems was submitted for an opinion of the Central Securities Depository and Clearing House, the
Association of Banks of Serbia, the Ministry of Finance and Economy, the Ministry of Foreign and Domestic
Trade and Telecommunications and the Tax Administration and there were no objections to the wording of
the law.

174
Priorities for 2013 with regard to harmonisation of legislation
Activities on drafting a new law on payment services will continue during 2013, whose adoption
would further harmonise the legislation with Directive 2007/64/EC on payment services in the internal mar-
ket (Directive 2007/64/EC of the European Parliament and of the Council of 13 November 2007 on payment
services in the internal market amending Directives 97/7/EC, 2002/65/EC, 2005/60/EC and 2006/48/EC and
repealing Directive 97/5/EC) and Directive 2009/110/EC on electronic money (Directive 2009/110/EC of the
European Parliament and of the Council of 16 September 2009 on the taking up, pursuit and prudential su-
pervision of the business of electronic money institutions amending Directives 2005/60/EC and 2006/48/EC
and repealing Directive 2000/46/EC).
The adoption of this law will, in accordance with Directive on payment services in the internal market,
regulate the rights and obligations of payment service providers and users of payment services in a compre-
hensive and detailed way. Provisions of this law will regulate the rules concerning the content of the infor-
mation of framework agreements on payment services, the types of payment services, information and
notification obligations, terms of payment transactions, value dates, refund, correction of errors, the time of
receipt of the order, the limited liability of the operator and many other issues. One of the most important
innovations of the above act is the opening of the market for other institutions apart from banks payment
institutions. In order to increase competition and give an incentive to efficient and cheaper provision of pay-
ment services, this law will allow other institutions in addition to banks to provide payment services. In ac-
cordance with this law, a regime of licencing and supervision of payment institutions will be established,
tailored to the types of services they provide and the risks that are immanent to these services. Provisions of
the Law on Payment Services will regulate one legally unregulated field in our market issuing of electronic
money. Generally speaking, the provisions of this law shall regulate two parts concerning electronic money:
general part, which is common to all issuers of such money, and concerns the way of issuing and buyoff of
electronic money, and a special part which concerns the licencing and operations of specific companies that
will deal with the issuance of electronic money electronic money institutions.
Also, the passing of the Law on Settlement Finality in Payment and Securities Settlement Systems
would harmonise the domestic legislation with Directive 98/26/EC on settlement finality in payment and se-
curities settlement systems). Provisions of this law will provide reduction of systemic risk in these systems
by regulating the irrevocability and finality of execution of the transfer orders, as well as the realisation of
collateral in the event of initiating a procedure against the participant because of inability to settle obliga-
tions.
The Proposal of the Law on Payment Services and the Proposal of the Law on Finality of Settlement
in Payment Systems and Securities Settlement Systems are expected to be submitted to the National Assem-
bly of the Republic of Serbia for adoption by the end of 2013. The Proposal of the Law on Payment Services
will be submitted to the National Assembly of the Republic of Serbia for adoption once the Proposal of the
Law on Debt Enforcement, Proposal of amendments to the Law on the National Bank regarding the licensing
and supervision of payment institutions and electronic money institutions and amendments to the Law on the
Prevention of Money Laundering and Terrorist Financing. Also, prior to the submission of the Proposal of
the Law on Payment Services, all outstanding issues related to the protection of consumers of financial ser-
vices will be resolved, as well as certain provisions of the current Law on Payment Transactions , which will
not be the subject of future Law on Payment Services.
The adoption of the Law on Payment Services and the Law on Finality of Settlement in Payment
Systems and Securities Settlement Systems would be a priority in the area of payment systems specified in
the Analytical report, which follows the European Commission's Opinion on the request of the Republic of
Serbia for EU membership and in the Report on the progress of the Republic of Serbia for 2012 (43), which
is related to the harmonisation of Serbian legislation with the EU regulations which regulate payments sys-
tem.
Administrative capacities
Within the National Bank of Serbia, there is the Payment System Department, with three organisa-
tional units sections, responsible for the methodology and development, risk management, monitoring of
payment systems and operational payment system. The Payment System Department currently employs 24
people.
Strengthening of administrative capacities of the National Bank of Serbia in the field of payment sys-
tem is implemented through the project Strengthening the institutional capacity of the NBS, which is fi-

175
nanced from IPA funds. The project started on 1 February 2011 and ends on 31 January 2013. As the project
envisages support in the transposition of the Directive on finality of settlement in payment systems and se-
curities settlement systems, as well as support to the development of payment systems supervision function,
harmonisation of statistical data in the area of payment systems with ECB standards and building institu-
tional capacity in the area of risk management and the application of stress tests in payment systems, study
trips and trainings for employees of the National Bank of Serbia who were engaged in this field were organ-
ised in the last two years.
Further specialisation of personnel through various forms of technical assistance and cooperation with
the central banks of countries in the region and the European Union will strengthen the administrative capac-
ity of the National Bank of Serbia in the field of payment systems.
Measures planned for the period 2014-2016
The Law on Payment Services and the Law on Finality of Settlement in Payment Systems and Securi-
ties Settlement Systems as well as corresponding by-laws are expected to be adopted by the end of 2014.

3.4.3. Prevention of money laundering


Overview
The Administration for the Prevention of Money Laundering of the Republic of Serbia was founded in
2002 with the adoption of the Law on Prevention of Money Laundering. The law was amended in 2009 and
2010 and was harmonised with international standards in this field. The most important international stan-
dards in this area are the FATF Recommendations and Directive 2005/60/EC of the European Parliament and
of the Council of Europe on the prevention of the use of the financial system for the purpose of money laun-
dering and terrorist financing.
In 2012 the main activities of the Administration for the Prevention of Money Laundering were prepa-
ration of national risk assessment, training of competent authorities and taxpayers, as well as the licensing of
authorized persons, reporting on the activities of international institutions in the field of money laundering
and terrorist financing and the development of typologies of money laundering in the Republic of Serbia.
The Administration for the Prevention of Money Laundering started creating a national risk assess-
ment within the framework of the MOLI project. The national risk assessment was carried out with the sup-
port of experts and based on the methodology of the World Bank. Participants are organised into several
working groups/modules, the risk is assessed in five sectors, estimating the volume of dirty money, harmoni-
zation of the laws at the national level, the banking sector, non-banking financial sector (capital market, in-
surance, leasing, voluntary pension funds) and the financial sector. Serbia is the first country in the world
which has launched a comprehensive national risks assessment and the recent changes in the implementation
of the FATF Recommendations, implementation of the national assessment of risk from money laundering
have been introduced as compulsory international standards to combat money laundering and terrorist fi-
nancing.
In 2012 the Administration for the Prevention of Money Laundering, in cooperation with the Council
of Europe and the OSCE, organised seminars and workshops aimed at raising awareness and knowledge of
the significance of regulations to combat money laundering and terrorist financing. Seminars and workshops
were designed for representatives of state bodies that are part of the system and the taxpayers under the Law
on Prevention of Money Laundering.
Amendments to the Law on Prevention of Money Laundering and Terrorist financing in 2010 pre-
scribed that the Administration for the Prevention of Money Laundering shall organise and conduct profes-
sional examinations for obtaining the licence of authorised person. Licence holding is a prerequisite for an
authorised person to perform recognition and tracking the clients . The licence introduction is above all
aimed at verifying the expert knowledge of authorized persons who are an important link in the fight against
money laundering and terrorist financing. During the period from September 2011 until December 2012, ex-
aminations were organised and conducted for obtaining the licence for authorized persons (Compliance Offi-
cer) for insurance, broker-dealer operations, authorized personnel in banks, taxpayers engaged in exchange
transactions and taxpayers in the field of postal services. To date, more than 600 licenses were issued for
authorized persons.
The Law on the Prevention of Money Laundering and Terrorist Financing (Official Gazette of RS, No.
20/09, 71/09 and 91/10) regulates the actions, activities and powers of the Administration for the Prevention of
Money Laundering. This law also fully implemented Directive 2005/60/EC of the European Parliament and of

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the Council of Europe on the prevention of the use of the financial system for the purpose of money laundering
and terrorist financing.
Priorities for 2013 in regard to harmonisation of legislation
In early 2013, the Administration for the Prevention of Money Laundering will start drafting the
amendments to the Law on Prevention of Money Laundering in order to comply with 40 new FATF Rec-
ommendations passed in February 2012.
The Administration for Prevention of Money Laundering developed a Draft law on restricting disposal
of assets in order to prevent terrorism. The draft is in compliance with the FATF 40 recommendations and with
international standards in this field. The draft law was sent to the competent authorities for comments. In early
2013 the draft law will be revised in accordance with the observations by competent state bodies, to be fol-
lowed by the adoption of the law in the Assembly.
The negotiations are underway for the adoption of a new (Fourth) Directive of the European Parlia-
ment and of the Council of Europe on preventing abuse of the financial sector for money laundering and ter-
rorist financing with which the Law on Prevention of Money Laundering will be harmonised.
Measures for implementation of priorities in 2013
The adoption of the National Strategy and Action Plan for the implementation of the National Strategy
for combating money laundering and terrorist financing is planned for 2013. The National strategy that is
currently in effect will be valid until 2013. The Administration for the Prevention of Money Laundering will
be actively working to establish a training centre, tasked with training the representatives of the Administra-
tion for the Prevention of Money Laundering for helping other government agencies in the efficient imple-
mentation of the Law on Prevention of Money Laundering and Terrorist Financing. The training centre
would be responsible for raising awareness about the importance of implementation of regulations to combat
money laundering. Seminars, workshops and trainings will continue to be organised for taxpayers, under the
Law on Prevention of Money Laundering and Terrorist Financing, and with the aim to raise awareness and
knowledge on the measures and actions that taxpayers are required to take. Also, during 2013, professional
exams will be organised for obtaining the licenses for authorized persons.
Administrative capacities
In order to efficiently use the existing and create new capacities in the Administration for the Preven-
tion of Money Laundering, a new organisation of the Administration for the Prevention of Money Launder-
ing has been in place since March 2012. Instead of the organisation and job classification, which was valid
until June 2011, the new Regulation on internal organisation and job classification provided the following
organisation and classification:
1. Division for Analytics, which comprises two sections:
- Section for Preanalytics
- Section for Financial Analysis
2. Division for International Cooperation and Legal Affairs
3. Division for Monitoring, with two groups:
- Group for Monitoring Accountants and Auditors
- Group for Monitoring Other Taxpayers
4. Group for Information Technologies
5. Group for Financial and Material Matters
Improvements were introduced in the Division for Analytics, which is composed of the Section for
Preanalytics aimed at a more efficient and accurate analysis by manually and through the information system
establishing interconnections between the reported transactions so as to draw analysts attention to the possi-
ble existence of suspicion of money laundering or terrorist financing and to facilitate financial and intelli-
gence work of analysts. Despite the active engagement, the Administration for Prevention of Money
Laundering did not succeed in securing adequate space that will be able to accommodate the number of em-
ployees planned by the internal organisation and job classification. The current number of employees is 32,
and according to the internal organisation and job classification, the planned number of employees is 40. For
failing to find adequate space and therefore the impossibility to engage the planned number of employees,

177
capacity development in this sense is not only stagnant, but there is a risk that the existing capacities will
collapse.
Obligations under the Stabilisation and Association Agreement and the Interim
Agreement
According to the Stabilisation and Association Agreement, the Administration for the Prevention of
Money Laundering is responsible for the implementation and harmonisation with the acquis in the area of
"current payments and capital movements" (Chapter 4). Article 84 of the Stabilisation and Association
Agreement in an area that is regulated under Title VII, "Justice, Freedom and Security" foresees the obliga-
tion of the Administration for the Prevention of Money Laundering to harmonise national legislation with
international standards in the field of combating money laundering and terrorist financing. Harmonisation is
primarily planned with the FATF Recommendations, which are mandatory for all members of the Council of
Europe. Under the agreement, there is a period of four years from the entry into force of the Agreement for
implementation and compliance with the acquis. After this period the European Union will evaluate the de-
gree of compliance.
Under the Analytical report by the European Commission (3.4. Chapter 4 "Free movement of capital"),
the Administration for the Prevention of Money Laundering is responsible for implementation of appropriate
regulations in order to harmonise national system with the EU legislation. This report evaluates that the Serbian
legislation is partially harmonised with the EU legislation in this area.
Obligations arising from the Stabilisation and Association Agreement and the Analytical report are
implemented through amendments to the Law on Prevention of Money Laundering and Terrorist Financing.
Overview of current and planned foreign development aid
The Administration for the Prevention of Money Laundering has so far been the holder of the most
important and most valuable project in the country that is dedicated to the fight against money laundering
and terrorist financing. The project is worth EUR 2,365,000, and is mainly funded by the European Union
(EUR 2 million), with the participation of the Council of Europe (EUR 200.000,00) and the budget of the
Republic of Serbia. The project implementation began in November 2010 and will run until November 2013.
The purpose of the project is to increase the capacity of the system to combat money laundering and terrorist
financing in Serbia in terms of legislative solutions, expertise and operational capacity. Apart from the Ad-
ministration for the Prevention of Money Laundering, the main beneficiary of this project, the users of this
project are also law enforcement bodies, supervisory and judicial authorities, as well as professional associa-
tions and civil society. The main objective of the project MOLI is to promote democracy and the rule of law
through prevention and control of money laundering and terrorist financing, as well as other forms of eco-
nomic and financial crimes in Serbia in accordance with European and other international standards.

3.5. Public procurement


Overview
The new Law on Public Procurement (Official Gazette of RS, No 124/12 of 29 December 2012) was
adopted on 29 December 2012 and entered into force eight days after its publication in the Official Gazette
of RS. The previous Law on Public Procurement (Official Gazette of RS, No 116/08) will be relevant until
the application of the new Law, which will take effect from 1 April 2013.
The previous Law on Public Procurement (hereinafter referred to as: the Law) eliminated the deficien-
cies identified in the application of the previous Law on Public Procurement, it introduced new solutions that
enabled contracting authorities to carry out public procurement procedures faster, eliminated collisions be-
tween individual provisions and incorporated European public procurement rules, aimed at more efficient
implementation of the Law.
The previous Law was harmonised with the acquis communautaire on public procurement, namely:
Directive 2004/18/EC, Directive 2004/17/EC, Directive 89/665/EEC, Directive 92/50/EEC, and with conclu-
sions and recommendations from the European Commission Progress Report on Serbia in 2006 and 2007.
However, although the previous Law was assessed as a step forward in the regulation of public pro-
curement, some problems in its application were noticed. In this sense, new solutions should have been
adopted that would primarily increase the transparency of public procurement procedures and transparency
in the execution of public procurement contracts, ensure a more effective protection of public procurement

178
procedures and monitoring of the implementation of this law and prevent corruption mechanisms (irregulari-
ties in the application of legal provisions or situations that are not regulated by the legal provisions, but may
cause certain corruptive effects) and conflict of interest in the public procurement system.
In addition, although the previous Law was harmonised with the relevant EU directives, the need
emerged for further harmonisation with the European Union legislation and best European practices in this
area, as well as with domestic regulations that have been passed in the meantime. For example, the previous
Law did not regulate certain procurement procedures provided for in the directives in this field (competitive
dialogue, dynamic procurement system and framework agreement), it did not apply to procurements which may
be declared confidential under a special regulation and that were declared as confidential by the competent au-
thority decision (procurement in the field of defence and security), it did not provide a commpn procurement
vocabulary as a referential classification system for subjects of public procurement. Also, some solutions con-
tained in the previous law were not in full compliance with relevant directives in this field (for example, the
procurement to which the Law does not apply; the way of determining the estimated value of the public pro-
curement, deadlines for the submission of bids in a public procurement; public procurement in the fields of wa-
ter management, energy, mining, telecommunications and transportation; respect of the conditions of
reciprocity and the choice between equal bids, the procedure of protection of rights, etc.).
The new Law on Public Procurement further harmonised the Serbian regulations with the acquis
communautaire governing public procurement, primarily with Directive 2004/18/EC of the European Par-
liament and of the Council of 31 March 2004 on the coordination of procedures for the award of public
works contracts, public supply contracts and public service contracts Celex No. 32004L0018), primarily in
the part related to the introduction of framework agreements, dynamic purchasing systems, Common pro-
curement vocabulary (CPV), and the introduction of new procedure competitive dialogue, it introduced
environmental standards and energy efficiency standards (as potential parts of the technical specifications),
as well as reserve supplies. Complying with Directive 2004/17/EC of the European Parliament and of the
Council coordinating the procurement procedures of entities operating in the water, energy, transport and
postal services sectors, primarily in the part relating to the definition of activities, exceptions and public pro-
curement procedures in these sectors Celex No. 32004L0017).
Also, with the adoption of the new Law, compliance was made with Directive 2007/66/EC of the
European Parliament and of the Council of 11 December 2007 with regard to improving the effectiveness of
review procedures concerning the award of public contracts, particularly in the part pertaining to pronounc-
ing of alternative penalties Celex No. 32007L0066).
Last but not least, the new law made a partial harmonisation with Directive 2009/81/EC of the Euro-
pean Parliament and of the Council of 13 July 2009 on the coordination of procedures for the award of cer-
tain works contracts, supply contracts and service contracts by contracting authorities or entities in the fields
of defence and security, and amending Directives 2004/17/EC and 2004/18/EC - Celex No. 32009L0081,
especially with regard to defining procurement in these sectors.
The Law on Public-Private Partnership and Concessions was adopted on 22 November
2011(Official Gazette of RS, No 88/11). For the first time in the legal system of the Republic of Serbia, the
law introduced the concept of public-private partnership, and for the first time the state and local authorities
will be able to satisfy their needs for infrastructure and public services carried out on this model with clearly
defined rules of procedure.
Determination of the conditions, manner and procedure for concluding public contracts is based on the
following principles: protection of the public interest, efficiency, transparency, equal and fair treatment, free
market competition, proportionality, protection of the environment, the autonomy of the will and equality of the
contracting parties, freedom of movement of goods, freedom to provide services, prohibition of discrimination,
etc.
The Law regulates the issues of the proceedings in which the state and local authorities come to the
most appropriate private partners for projects of public-private partnerships. The process of selecting the pri-
vate partner is either through a procurement procedure determined by the law governing public procurement
or through concession award procedure set by this law.
If the implementation of the PPP involves concession or service with the right to exploit the specific
services and the right to collect payment, the process of selecting the private partner shall be conducted in
accordance with the provisions of this law. If the awarded concession mainly bears the characteristics of pub-
lic works concessions, the process of selecting a concessionaire/private partner shall be subject to public pro-

179
curement procedures, under the law governing public procurement. If a public body for the implementation
of the PPP hires an advisor, their choice is subject to the law governing public procurement.
Sources of the EU law used and implemented in the Law on Public-Private Partnerships and conces-
sions are as follows:
- Treaty on the Functioning of the European Union Title I Internal Market, Article 26, and Title
VII, Chapter 3, Approximation of laws, Article 114.
- Directive 2004/18/EC;
- Directive 2004/17/EC;
- Directive 2009/81/EC;
- Council Directive 92/13/EEC of 25 February 1992 coordinating the laws, regulations and adminis-
trative provisions relating to the application of Community rules on the procurement procedures of
entities operating in the water, energy, transport and telecommunications sectors;
- Council Directive 89/665/EEC of 21 December 1989 on the coordination of the laws, regulations
and administrative provisions relating to the application of review procedures to the award of pub-
lic supply and public works contracts;
- Regulation (EC) No 2195/2002 of the European Parliament of 5 November 2002 on the Common
Procurement Vocabulary (CPV);
- Commission Regulation (EC) No 1564/2005 of 7 September 2005 establishing standard forms for
the publication of notices in the framework of public procurement procedures;
- Commission interpretative communication on the application of Community law on Public Pro-
curement and Concessions to institutionalised PPP;
- Statement of the Commission to the European Parliament, the Council, the European Economic
and Social Committee and the Committee of the Regions - Mobilising private and public invest-
ment for recovery and long term structural change: developing public-private partnerships;
- Communication on the application of Article 296 of the Treaty for the procurement in the field of
defence.
Priorities for 2013 with regard to harmonisation of legislation
The Ministry of Finance and Economy prepared a draft Regulation on the supervision of implementa-
tion of public contracts awarded for the implementation of public-private partnerships with and without the
elements of concession, as well as the draft Rulebook on the methods and content of the register of public
contracts. Methodology Value for Money is in the final stage and it was entrusted to international consult-
ants.
Based on powers contained in the new Law on Public Procurement, it is expected that in due course,
these institutions prepare the by-laws23 relating to:
The Government of the Republic of Serbia
1. List of contracting authorities referred to in Article 2 of the Proposal of the Law list of contracting
authorities is determined by the Government at the proposal of the Ministry of Finance and Public Pro-
curement Office at the beginning of the fiscal year. The deadline for adoption: 6 April 2013, but the
beginning of law enforcement is 1 April 2013 and it would be appropriate to adopt the law by 1 April
2013.
2.List of contracting authorities set out in Article 117 (procuring entities in the field of water, energy,
transport and postal services) the list of contracting authorities is determined by the Government at
the beginning of the budget year, at the proposal of the Ministry of Finance, the ministry responsible
for water, energy, transportation, and the Public Procurement Office. The deadline for adoption: 6
April 2013, but the beginning of law enforcement is 1 April 2013 and it would be appropriate to adopt
the law by 1 April 2013.

23
By-laws adopted on basis of authorizations under the new Law will be passed within 3 months following the entry
into force of this Law. The by-laws under Article 21, para. 6 and Article 22, para. 2 of the new Law will be adopted
within 9 months after the entry into force of the new Law.

180
3.List of contracting authorities referred to in Article 7 (for items 1), 6) and 7)) the Government de-
termines the list of procuring entities. Deadline: it would be appropriate to adopt the law by 1 April
2013.
4.List of contracting authorities under Article 49 determined by the Government based on the pro-
posal of the Ministry of Finance and the Public Procurement Office. The deadline for adoption: 2 nd
quarter of 2013.
5.List the procurement objects under Article 49 a list of objects related to centralised procurement
will be conducted by the Administration for Joint Services of the Republic Bodies to be specified by
the Government. The deadline for adoption: 2nd quarter of 2013.
6. Government Decree which establishes the Common Procurement Vocabulary (Article 56) CPV
(Common Procurement Vocabulary). The deadline for adoption: 1 April 2013.
7. The public procurement procedure in the field of defence and security and the list of goods, services
and works under paragraph 1 of Article 127 regulated and laid down by the Government. The dead-
line for adoption: 6 April 2013, but the beginning of law enforcement is 1 April 2013 and it would be
appropriate to adopt the law by 1 April 2013.
8. Decree on the supervision over implementation of public contracts awarded for the implementation
of public-private partnerships with and without the elements of concession. The deadline for adoption:
31 March 2013.
9. Rulebook relating to the plan for the fight against corruption in public procurement approved by
the Government upon the proposal of the Anti-Corruption Agency and the Public Procurement Office.
The deadline for adoption: 4th quarter of 2013.
Public Procurement Office
1. The contents of internal documents from Article 22 of the Proposal of the Law, which regulates
the phases of public procurement process. The deadline for adoption: 4th quarter of 2013.
2. Conditions and criteria for the appointment and operation of civil supervisor - Article 28. Dead-
line for adoption: 6 April 2013, but the beginning of law enforcement is 1 April 2013 and it
would be appropriate to adopt the law by 1 April 2013.
3. Form and content of the procurement plan and report on the execution of procurement plan (Arti-
cle 51). The deadline for adoption: 6 April 2013, but the beginning of law enforcement is 1 April
2013 and it would be appropriate to adopt the law by 1 April 2013.
4. Compulsory elements of tender documentation (Article 61). The deadline for adoption: 6 April
2013, but the beginning of law enforcement is 1 April 2013 and it would be appropriate to adopt
the law by 1 April 2013.
5. Way of proving eligibility (Article 77). The deadline for adoption: 6 April 2013, but it would be
appropriate to adopt the law by 1 April 2013.
6. The content of the report on public procurement and the manner of keeping records of public
procurement (Article 132). The deadline for adoption: 6 April 2013, but it would be appropriate
to adopt the law by 1 April 2013.
7. The method and programme of training and taking the professional exam for public procurement
officials (Article 134). The deadline for adoption: 6 April 2013, but it would be appropriate to
adopt the law by 1 April 2013.
Ministry in charge of finances
1. List of international organisations and financial institutions (Article 7)
2. The form and content of credit application (Article 61)
3. Preferentials (Article 86)
4. Rulebook on the procedure, method of keeping and the content of the register of public contracts
(enacted by the Minister of Finance and Economy). The deadline for adoption: 31 March 2013.
5. Rulebook on the content of the register of bidders and documentation that must be submitted with
the application for registration of bidders.

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The deadlines for the adoption of the acts numbered 1, 2, 3 and 5: By-laws that are adopted under the
competences prescribed by the Law on Public Procurement shall be adopted within three months from the
date of entry into force of this Law. By-laws under Article 21, paragraph 6 and Article 22, paragraph 2 of
this Law shall be adopted within nine months from the date of entry into force of this Law.
The adoption of a new Law on Public Procurement and its implementation should significantly meet
the priority related to the reduction of corruption in public procurement specified in the analytical report,
which tracks the Commission Opinion on the application of the Republic of Serbia for EU membership.
Also, the new law and its implementation should significantly meet the priority which is related to (rarely)
taking appropriate measures by the authorities in case of misuse of public funds specified in the Progress Re-
port for RS in 2012.
Measures for implementation of priorities in 2013
In September 2011 the Serbian Government adopted a Strategy of public procurement in the Republic
of Serbia (hereinafter: the Strategy). An integral part of the Strategy, inter alia, is the Action plan that should
include goals, activities and stakeholders in the implementation of this strategy. However, the aforemen-
tioned Action plan, as opposed to the Strategy that was positively evaluated both by local stakeholders in the
public procurement and by international institutions and organisations in Serbia, did not adequately fulfil its
purpose, which is the implementation of the Strategy. Therefore, it is necessary to adopt a new, revised ac-
tion plan, which would be an adequate instrument for the implementation of the Strategy. In this regard, the
Public Procurement Office proposed that the proposal for the adoption of a revised Action plan for imple-
mentation of the strategy (recommendation 80; deadline: 1 July 2013) should be included in the Action Plan
for implementation of recommendations contained in the European Commission's annual Progress Report for
the Republic of Serbia 2012 ; the proposal was adopted and included in the version of the Action Plan by the
Government of Serbia adopted at its session of 6 December 2012.
Administrative capacities
Under the new Law on Public Procurement, the preparation and drafting of the Law on Public Pro-
curement and making most of by-laws will continue to be the responsibility of the Public Procurement Of-
fice. The Public Procurement Office is a special organisation for the performance of professional activities in
the field of public procurement, in order to ensure the conditions for the economical, efficient and transpar-
ent use of public funds for public procurement and encouraging competitiveness and equality of bidders in
public procurement procedures.
The Public Procurement Office currently has 18 employees, including 7 lawyers, 6 economists and 5
officers with a high school diploma. Employees are divided into the following units: The Public Procurement
Department (which includes the Section for the development and improvement of the public procurement
system, Group for monitoring public procurement procedures and the Group for expert tasks in public pro-
curement), Group for personnel and general affairs and Group for financial and material affairs.
The plan is to increase the capacity of the Public Procurement Office, in accordance with the changed
and considerably increased powers of this body, which would include changing its organisational structure
(new job classification). In this regard, the Public Procurement Office has proposed in the Action Plan for
implementation of recommendations contained in the European Commission's annual Progress Report for the
Republic of Serbia in the process of European integration in 2012 that a proposal is inserted to approve an
additional number of employees to the Public Procurement Office in accordance with the new powers under
the proposed new law (recommendation No 83; deadline: 1 April 2013), which was adopted and included in
the version of the Action Plan by the Government of Serbia adopted at its session of 6 December 2012.
Expert assistance in the implementation of projects of public-private partnerships and concessions un-
der this Law is done by the Commission for Public Private Partnership formed by the Government, at the
proposal of:
1. Prime Minister's office,
2. Ministry in charge of Economy and Regional Development,
3. Ministry responsible for finance;
4. Ministry responsible for infrastructure,
5. Ministry responsible for mining,
6. Ministry in charge of utility services,

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7. Ministry in charge of environmental protection,
8. autonomous province,
9. and the City of Belgrade.
By the end of 2012, the Commission for PPP gave 3 positive opinions to the proposed projects for re-
alisation of public-private partnerships with and without the elements of concession.
Measures planned for the period 2014-2016
During this period (until 31 December 2016), harmonisation of national legislation on public procure-
ment with the new EU directives on public procurement (which are expected to be adopted in 2013) is
planned , and that:
- Proposal for a Directive of the European Parliament and of the Council on public procurement of
20 December 2012 -Celex No. 52011PC0896 and
- Proposal for a Directive of the European Parliament and of the Council on procurement by entities