European Commission published its annual enlargement reports yesterday. We report the key findings of the Report on Bosnia and Herzegovina in the area of democracy, rule of law and economic criteria:
The conduct of the elections is negatively affected by the discriminatory elements of the constitutional system and by the lack of integrity of the electoral process. Parliament needs to take measures to ensure that elections are conducted in line with European standards by implementing the recommendations of the OSCE Office for Democratic Institutions (ODIHR), the Council of Europe Group of States against Corruption (GRECO) and relevant Venice Commission recommendations, and to ensure transparency of political party financing. Political parties should respect the independence of the Central Election Commission.
Parliament is able to exercise its powers in a broadly satisfactory way. Legislative assemblies increased legislative output. Parliamentary oversight over the executives remains weak. The Stabilisation and Association Parliamentary Committee met regularly.
The institutions in charge of the integration process are broadly in place. Coordination on EU matters needs to be strengthened, including the role of the Directorate for European Integration (DEI). The Council of Ministers needs to improve the functioning of the coordination mechanism, to develop a national programme for the adoption of the EU acquis and to urgently appoint the national IPA coordinator (NIPAC) under the Instrument for Pre-accession (IPA) III. The country should set up an operational negotiating structure following the European Council decision to open accession negotiations and appoint a chief negotiator.
Governance is broadly satisfactory. The Council of Ministers took action to adopt EU-related reforms with tangible results prior to the Commission report in March 2024, although the positive reform dynamic has stalled since. The executives have little capacity for coordination and policy planning. Independent institutions remain weak.
Civil society organisations operate in a constrained environment, in particular in the Republika Srpska entity. Bosnia and Herzegovina needs to ensure meaningful and systematic consultations with civil society as part of an inclusive policy dialogue and adopt a framework for the transparent funding of civil society organisations, thus ensuring an enabling environment for civil society.
Bosnia and Herzegovina is in between an early stage and some level of preparation and made some progress in public administration reform (PAR), notably by (i) establishing the Coordinating Committee for PAR at prime ministers’ level; (ii) organising the first public financial management (PFM) dialogue in May 2024; (iii) conducting the public expenditure and financial accountability (PEFA) assessment and continuing implementation of the countrywide PFM Strategy; (iv) adopting the state-level civil service law in March 2024; and (v) establishing in October 2023 a forum of civil service agencies to steer civil service policy in a harmonised way. Bosnia and Herzegovina needs to complete essential steps to improve the overall functioning of its public administration by ensuring a professional and depoliticised civil service and a coordinated, countrywide approach to policymaking.
Bosnia and Herzegovina is in between an early stage of preparation and having some level of preparation in the area of the judiciary. Limited progress was made on the functioning of the judiciary, including on addressing the findings of the expert report on rule of law issues (the ‘Priebe Report’)10. Persistent and evident signs of deterioration continue to require urgent measures to strengthen integrity and restore public trust in the judiciary. The poor functioning of the judicial system continued to undermine citizens’ rights and the fight against corruption. In January 2024, the obstruction to accessing personal data for external experts tasked with monitoring the asset declaration system were removed from the Law on the High Judicial and Prosecutorial Council (HJPC); the right of the HJPC to access additional information from natural and legal person still needs to be strenghthened.
The draft new Law on the HJPC should be brought in line with the June 2024 interim opinion of the Venice Commission. Bosnia and Herzegovina should submit the revised draft for a follow-up opinion, and fully align the draft law with its recommendations before adoption by Parliament. The Republika Srpska entity assembly should swiftly appoint the two vacant judges to the Constitutional Court of Bosnia and Herzegovina. The Republika Srpska entity should also fully recognise and enforce the decisions of the Constitutional Court, repealing any legislation to the contrary.
Bosnia and Herzegovina is in between an early stage of preparation and having some level of preparation in the fight against corruption. Some progress was made during the reporting period. The state-level Law on the prevention of conflict of interest, adopted in March 2024, is a substantial step forward, although it is not yet fully in line with European standards. In June 2024, Bosnia and Herzegovina adopted a state-level strategy and action plan on anti-corruption. Legislation is still not harmonised across the country. Selective and non-transparent judicial follow-up in corruption cases of public resonance is a cause of significant concern, along with pressure and intimidation, as evidenced in a number of high-level cases.
The track record on fighting corruption (including high-level corruption) remains weak due to operational inefficiency and political interference. Prosecutors’ offices however advanced in a number of investigations for high-level corruption cases. The number of final convictions in high-level cases remains very low, one notable exception being the final conviction in the Novalić et al case. Only in Sarajevo Canton is there efficient application of conflict of interest rules, verification of asset declarations and protection of whistle-blowers. Targeted risk assessments and dedicated measures are needed to address corruption in the most vulnerable sectors.
The general framework for fundamental rights is largely in place but needs to be improved. The country needs to urgently adopt constitutional and electoral reforms to ensure that all citizens are able to effectively exercise their political rights, notably bring the country’s Constitution into line with the Sejdić-Finci case law of the European Court of Human Rights. Freedom of assembly remains restricted, and civil society is being targeted, in particular in the Republika Srpska entity. The entity government withdrew a draft law targeting civil society groups as ‘foreign agents’; such a legislative initiative should not be reintroduced, as it would mark a step backwards. Further progress is required across key priorities 9-13. The Commission’s recommendations from last year have not been implemented and remain valid.
There is some level of preparation on freedom of expression. There was no progress in guaranteeing freedom of expression and of the media, and the protection of journalists. Political pressure, intimidation and harassment towards journalists continued, including physical and verbal attacks, with no appropriate institutional follow-up. Political influence over public broadcasters persists, and their financial sustainability is ever more in danger. The Law on the public broadcasting system remains unimplemented, and entity-level legislation is still not harmonised with this law. The criminal penalties for defamation in the Republika Srpska entity continue to severely impact freedom of expression and of the media and to have a chilling effect. Sarajevo Canton’s legislative initiative on sanctions for online ‘fake news’, if adopted, could be abused to restrict media freedom. Any such norms must fully respect freedom of expression standards.
Bosnia and Herzegovina is between an early stage of preparation and having some level of preparation in the fight against organised crime. Some progress was made, notably with the adoption of legislation on anti-money laundering, enforcement operations supported by Europol, and improved coordination capacity in the Prosecutor’s Office. Systemic shortcomings remain in the operational cooperation and capacity of law enforcement agencies to investigate due to non-harmonised criminal legislation, weak institutional coordination and lack of resources. Financial investigations and asset seizures and confiscations remain insufficient. A proactive approach is essential to stop criminal infiltration in the political, legal and economic systems.
Bosnia and Herzegovina is at an early stage of preparation and has made limited progress in establishing a functioning market economy. Economic growth slowed down to about 1.6% in 2023, mainly reflecting a deteriorating international environment. The labour market remained resilient, but a significant outflow of workers is leading to labour shortages. The public sector continued to be inefficient and oversized. The business environment suffers from a fragmented internal market and a weak rule of law. Political stalemates, a lack of cooperation among the various levels of government, and resistance from entities and cantons continued to delay necessary structural reforms.
Bosnia and Herzegovina is between an early stage of preparation and having some level of preparation and made limited progress concerning its capacity to cope with competitive pressure and market forces in the EU. The overall quality of education remains inadequate. The country continues to lag behind in the energy and digital transitions. However, some structural adjustment took place, with the focus of the country’s value added moving towards services such as trade, IT and tourism. Economic integration with the EU remains high, but overall trade is below potential.