PM+: EU-Montenegro relations must be founded on rule of law

Written by Andrey Petrushinin on 23 June 2014 in Opinion Plus
Opinion Plus

The rule of law must be firmly on this week's EU-Montenegro summit agenda, argues Andrey Petrushinin.

On Tuesday 24 June in the margins of this week's general affairs council, the EU and Montenegro will hold an intergovernmental stabilisation and association summit in Luxembourg to evaluate the progress of the latter in its EU accession process.

The summit will seek to provide some much-needed political impetus to progress the tough negotiations of the past two years. On the same day a business conference will take place in the Montenegrin capital Podgorica in which European business and trade union representatives will discuss a vision for Montenegrin civil society.

It is perhaps coincidental that these two meetings take place concurrently, but it is a fortunate happenstance. Both the summit and conference will seek to address some of the extremely pressing issues blighting Montenegro which need to be resolved: indeed, both summits are inextricably linked, as success in developing and implementing a vision for a cohesive Montenegrin civil society governed by the rule of law will do much to help the country down the path to EU membership.

Application of the rule of law is extremely weak and uneven in Montenegro, whether in terms of human rights, civil liberties, freedom of expression, separation of powers executive and judicial, protection of investors’ rights and providing the stable legal environment that will reassure and attract the foreign direct investment that is crucial to develop the Montenegrin economy.

The Central European Aluminium Company’s (CEAC) own experiences in Montenegro are testament to the enormous progress that the country needs to make in the area of the latter.

When we invested in the country’s then largest industrial concern, the Kombinat Aluminijuma Podgorica (KAP), purchasing 65 per cent of the company, it represented some 50 per cent of Montenegro’s total exports and 15 per cent of its GDP.

Today, following almost a decade of state interference and executive and judicial meddling during which time CEAC was repeatedly frustrated in its efforts to return the company to profitability, the government of Montenegro has managed to run this once proud enterprise into the ground, ignominiously declaring it bankrupt and recently selling it off for scrap for a trifling amount well below its market value.

The very actions of the government and its representatives in this sorry story are extremely questionable, without legal basis, and are the subject of international arbitration.

But that this was an isolated incident. Regrettably, we are aware that the Montenegrin government is facing a series of similar legal proceedings in international courts brought by other disgruntled foreign investors.

It would appear that when it comes to FDI in its country, the Montenegrin government’s modus operandi is taken from a playbook far from the minimum standards required of a candidate member of the EU, from the total absence of independent administrators to failing to consult its creditors and the non-formation of a creditor committee – all of which, by the way, are required by Montenegro’s own laws.

A country that has such scant regard for its own laws can hardly be trusted to adopt and apply the acquis communautaire required for successful EU accession.

"The EU surely cannot allow accession at any price, especially if that price is the effective undermining of the important minimum standards of good governance and the rule of law that is so fundamental to the EU's proper functioning"

Let us be clear: we are not against Montenegro’s EU membership. Indeed, we encourage and support it, for we believe it will benefit not just the ordinary citizens of Montenegro, but the Balkans as a whole, and the wider European region.

But the EU surely cannot allow accession at any price, especially if that price is the effective undermining of the important minimum standards of good governance and the rule of law that is so fundamental to the EU's proper functioning.

We sincerely hope that a strong vision for a robust civil society governed by the rule of law emerges from Tuesday’s meetings, and we encourage the EU member states gathered in summit to impress the need for urgent reform in this regard upon the Montenegrin government.

About the author

Andrey Petrushinin is corporate affairs director at the Central European Aluminium Company (CEAC)

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