DRAFT
REPUBLIC OF SERBIA
MINISTRY OF FINANCE
R E P O R T
on programming EU funds under the IPA (Instrument for Pre-accession Assistance) Component 2: Regional and Cross-Border Cooperation
Belgrade, June 2007
CONTENTS
R E P O R T
on programming EU funds under the IPA (Instrument for Pre-accession Assistance) Component 2: Regional and Cross-Border Cooperation
1. Introductory remarks ...... 4
1.1. PROCESS DESCRIPTION: PROGRAMMING FUNDS UNDER
THE IPA COMPONENT II: REGIONAL AND
CROSS-BORDER COOPERATION ...... 5
2. PROCESS STATUS: PROGRAMMING FUNDS UNDER THE IPA
COMPONENT II - REGIONAL AND CROSS-BORDER
COOPERATION ...... 8
COOPERATION WITH EU MEMBER STATES
2.1. Republic of Serbia – Republic of Hungary ...... 9
2.2. Republic of Serbia – Republic of Bulgaria ...... 12
2.3. Republic of Serbia – Romania ...... 14
COOPERATION WITH CANDIDATE COUNTRIES AND
POTENTIAL CANDIDATE COUNTRIES
2.4. Republic of Serbia – Republic of Croatia ...... 18
2.5. Republic of Serbia – Bosnia and Herzegovina ...... 21
2.6. Republic of Serbia – Republic of Montenegro ...... 24
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REPORT on programming EU funds under the IPA (Instrument for Pre-accession Assistance) Component 2: Regional and Cross-Border Cooperation1. INTRODUCTORY REMARKS
The Ministry of Foreign Economic Relations of the Republic of Serbia, pursuant to the Law on ministries (“Official Gazette of RS,” Nos. 19/04, 84/04 and 79/05), was responsible for the coordination of activities related to planning, programming, ensuring and using grants and other forms of foreign development assistance, implemented in the framework of the Sector for grants and development assistance.
In accordance with the Law on Ministries, as of 15. May 2007 (“Official Gazette of RS” No. 48/07), the Ministry of Foreign Economic Relations of the Republic of Serbia was dissolved, and under Article 6. of the referred Law, the Ministry of Finance took over public administration tasks related to the coordination of activities related to planning, ensuring and using grants, European funds and other forms of foreign development assistance, and thereby, as well, became responsible for the cross-border cooperation funds programming and managing.
The legal ground for the establishment of the Instrument for Pre-Accession Assistance (IPA) is laid down in the Council of the European Union Regulation (Council Regulation (EC) No 1085/2006), adopted on 17. July 2006. Candidate countries: Former Yugoslav Republic of Macedonia, Republic of Croatia, and Republic of Turkey, and potential candidate countries: Republic of Albania, Bosnia and Herzegovina, Republic of Montenegro, and Republic of Serbia are all entitled to use IPA funds in the period 2007-2013. IPA includes the following 5 basic components:
1. Transition Assistance and Institution Building
2. Cross-Border Cooperation
3. Regional Development
4. Human Resources Development
5. Rural Development
While potential candidate countries can be beneficiaries of components 1 and 2, candidate countries for EU membership can be beneficiaries of components 1 - 5. Countries granted candidate status can become beneficiaries of all the five IPA components.
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Under the Multi-annual indicative financial framework, Republic of Serbia is entitled to the following IPA allocations:
Component / 2007 / 2008 / 2009 / 2007-2009I. Transition assistance and Institution-Building / 178,5 / 179,4 / 182,6 / 540,5
II. Cross-Border Cooperation / 8,2 / 11,5 / 12,2 / 31,9
Total / 186,7 / 190,9 / 194,8 / 572,4
1.1. PROGRESS DESCRIPTION: FUNDS PROGRAMMING UNDER THE IPA
COMPONENT II: REGIONAL AND CROSS-BORDER COOPERATION
In the Republic of Serbia, the following programs of cross-border cooperation with member states, candidate countries or potential candidate countries have been approved in the framework of the IPA Component II
Cross-border and transnational programs with EU member states / 2007 / 2008 / 2009 / TOTALSerbia – Hungary / 1,334 / 2,790 / 2,486 / 6,600
Serbia- Romania / 1,580 / 2,698 / 2,943 / 7,221
Serbia – Bulgaria / 1,265 / 2,160 / 2,356 / 5,681
Adriatic Program / 0,319 / 0,546 / 0,596 / 1,461
SEE – CEEC Cooperation Program / 1,000 / 0,500 / 0,500 / 2,000
22,963
Cross-border programs with candidate
countries or potential candidates / 2007 / 2008 / 2009 / TOTAL
Serbia-Croatia / 1,000 / 1,000 / 1,000 / 3,000
Serbia-Bosnia and Herzegovina / 1,100 / 1,100 / 1,100 / 3,300
Serbia-Montenegro / 0,500 / 0,500 / 0,500 / 1,500
Serbia-Macedonia* / 0 / 0 / 0
Serbia-Kosovo and Metohija* / 0 / 0 / 0 / 7,800
*At RS motion, programs with FYR Macedonia and Kosovo and Metohija have been postponed for an indefinite time, until political questions related to K&M are settled.
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The Republic of Serbia started working on the preparation of Cross-Border Cooperation Program in the end of 2005, in keeping with the initial instructions of the European Commission (hereinafter: EC). Programs have been jointly prepared by cross-border partner countries. For each of the programs the following working bodies have been established and tasked to elaborate program documents:
• Joint Programming Committee – gives strategic guidelines;
• Task Force for the elaboration of the Program – operational body.
In the period November 2006 - May 2007, 6 cross-border cooperation program documents have been prepared within the IPA Component II programming process, structured as following (EU programming rules) :
1. Analysis of the situation and SWOT analysis
- definition of eligible program areas (border and neighboring regions);
- description of the situation in the region, in accordance with the parameters defined in the EC regulations, which includes basic historic, geographic, demographic, economic and environmental characteristics of the region;
- consultations and identification of strengths, weaknesses, opportunities and threats (SWOT) for the related program region;
- adoption of the Analysis of the situation and SWOT analysis by the Programming Committee.
2. Strategy
- definition of cross-border cooperation program goals;
- definition of cross-border cooperation program priorities;
- definition of measures to be undertaken to achieve priorities and goals;
- definition of indicators to be used to monitor achievement of objectives and goals, as well as of results/outcomes;
- definition of financial allocations distribution by priorities;
- consultations and adoption of the strategic part of the cross-border cooperation program.
3. Program Implementation Procedures (implementation structures)
- definition and detailed description of the implementation structures and bodies for the cross-border cooperation program;
- definition of the Program monitoring and evaluation plan;
- definition of the financial audit plan;
- definition of procedures for the selection of the projects and allocation of funds.
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4. Adoption and submission of the Draft Proposal of the IPA Cross-Border Cooperation Program to relevant Directors of the European Commission.
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5. Informal consultations with relevant directors of the European Commission.
6. Formal submission of the Proposal of the IPA Cross-Border Cooperation Program to the European Commission.
Republic of Serbia (Ministry of Foreign Economic Cooperation – Sector for development assistance and grants) participated in all the stages of preparation of the Cross-Border Cooperation Program, and by 31. May 2007 submitted a total of 6 programming documents to EC competent directors general. After consultations in the framework of the EC competent bodies and with the participating countries in the cross-border cooperation are completed (by the end of 2007), these documents shall become the basis of cross-border cooperation in the following period. In compliance with the provisions of EU legislation, programming documents can be reviewed and adjusted after 2009.
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2. PROCESS STATUS: PROGRAMMING EU FUNDS UNDER IPACOMPONENT II: REGIONAL AND CROSS-BORDER COOPERATION
In the framework of the Council of the European Union Regulation (Council Regulation (EC) No 1085/2006), by the end of June 2007, the Republic of Serbia has launched process programming for the IPA Cross-Border Cooperation Program: Component II, with the following countries: Republic of Bulgaria, Romania, Republic of Hungary, Republic of Croatia, Bosnia and Herzegovina, and Republic of Montenegro, and has participated in the programming of transnational programs: Adriatic Program and SEE – CEEC cooperation Program, as one of the partners.
Hereafter are given basic information about the process status regarding the IPA Cross-Border Cooperation Program: Component II, with each of the stated countries.
COOPERATION WITH EU MEMBER STATES
In the framework of the Council of the European Union Regulation (Council Regulation (EC) No 1085/2006) and the Council Regulation (EC, Euratom) No 1605/2002, the legal framework has been established for the methods of implementation of the Cross-Border Cooperation Program between the EU member states and the potential candidate countries..
In case when all the conditions are fulfilled related to the required management and audit systems to be established, within the Cross-Border Cooperation Program between EU member states and IPA beneficiary countries, the shared management rule defines the methods of program implementation (Article 53(b) and Title II (Chapter II) of the Council Regulation (EC, Euratom) No 1605/2002). This method defines special conditions for the implementation of programs concerning EU member states and IPA beneficiary country, which reflect management systems and procedures defined by the regulations regarding EU structural funds, adjusted to contractual procedures applied in financing projects from the General Budget of the European Communities, in terms of external activities (Threshold Rules). When Cross-Border Cooperation Program is implemented in the framework of the shared management system with EU member states, in the territory of the letter he following bodies must be established (Article 102, Council Regulation (EC) No 1085/2006:
- single managing authority
- single audit authority
- single certifying authority
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When in the Cross-Border Cooperation Program between EU member states and IPA beneficiaries, not all conditions have been met for the implementation of the shared management system, in that stage methods of program implementation can be used that are defined in Article 99, (Council Regulation (EC) No 1085/2006) under transitional arrangements. In such case, EC shall conclude annual financing agreements with each of the Program beneficiary country, and such agreements define the amount of EU funds that shall be allocated and the year to which such allocation relates.
The Cross-Border Cooperation Program between EU member states and IPA beneficiary countries implemented via transitional arrangements method, in the part related to EU member state shall be implemented in compliance with the rules defined under Section 2, Chapter 3 (Council Regulation (EC) No 1085/2006), while in the part related to IPA beneficiary country it shall be implemented in compliance with the rules defined under Section 3, Chapter 3 (Council Regulation (EC) No 1085/2006).
Additional distinction between implementing the Cross-Border Cooperation Program between EU member states and IPA beneficiaries via shared management method and via transitional arrangements method relates to different program implementation structures, functions and obligations of the relevant program implementation bodies, financial provisions and roles in Program information and promotion.
From the view point of the Republic of Serbia’s interests, participation in the Cross-Border Cooperation Program under shared management system cannot be a priority and preference, because most of the key functions, obligations and responsibilities are taken by EU member state partners and EC, which does not encourage building and development of the Republic of Serbia institutions necessary in the EU accession process.
Taking into consideration that both methods of program implementation are defined in detail in the referred EC regulations, a more detailed comparative analysis of these two methods of Cross-Border Cooperation Program would probably overburden this document and put an emphasis on the elements beyond the focus of this report.
2.1. Republic of Serbia – Republic of HungaryIn the framework of the programming process for the Cross-Border Cooperation Program between the Republic of Serbia and Republic of Hungary, launched on 30 March 2006. године, a total of 7 meetings of the working bodies were held. Draft proposal of the Cross-Border Cooperation Program was adopted and submitted to European Commission for consideration on 10. May 2007. Total amount of allocations under the proposal of the Cross-Border Cooperation Program Financing Plan for the period 2007 - 2013, amounts EUR 50.112 million, and the program shall be implemented under the joint “shared” system of funds managing.
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MAP: Eligible Area Serbia - Hungary Cross-Border Cooperation Program
In compliance with the recommendations of the European Commission, program area has been defined, where 21,506 square kilometers is within the Republic of Serbia, i.e. the territory of AP Vojvodina.
Allocations from the IPA fund for Cross-Border Cooperation Program Serbia – Hungary, by year, are as following (in thousand EUR):
IPA2007 / 4 040 / 8%
2008 / 6 901 / 14%
2009 / 7 527 / 15%
2010 / 7 677 / 15%
2011 / 7 831 / 16%
2012 / 7 988 / 16%
2013 / 8 148 / 16%
TOTAL (2007-2013) / 50 112 / 100%
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Program priority axes and measures
Priority axis 1. Infrastructure and Environment
• Infrastructure in the sphere of physical connectedness
• Shared environment responsibility
Priority axis 2. Economy, education and culture
• Joint development encouraging economy
• Education and culture for common purposes
Priority axis 3. Technical assisstance
In compliance with the IPA Regulation (Article 139, paragraph 4) the operating structures shall set up a Joint Technical Secretariat with an antenna in Serbia, which shall provide assistance in the implementation of the Cross-Border Cooperation Program.
It was proposed that the Joint Technical Secretariat be based in Budapest, and that the Serbian antenna be set up in Subotica. The precise number of the staff working in the Joint Technical Secretariat has not been defined in the Operative program, but their number and qualifications shall instead be defined corresponding to the current needs. It has been envisaged that the Joint Technical Secretariat shall employ up to 3 persons from Serbia (1 person is already engaged for the Neighborhood Program 2004 – 2006), and in the antenna in Subotica 2 more persons shall be engaged (two employees are already working on the Neighborhood Program 2004 – 2006) .
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2.2. Republic of Serbia – Republic of BulgariaIn the framework of the programming process for the Cross-Border Cooperation Program between the Republic of Serbia and Republic of Bulgaria, launched on 20. February 2006, a total of 4 meetings of the working bodies were held. Draft proposal of the Cross-Border Cooperation Program has not as yet been adopted and submitted to European Commission, because the Serbian party has submitted a request that the Program be implemented under the transitional system of funds managing, which has not been responded as yet. Total amount of allocations under the proposal of the Cross-Border Cooperation Program Financing Plan for the period 2007 - 2009, amounts EUR 11,552,116.