CEAC welcomes EU Council conclusions on Montenegro

CEAC is encouraged that Council's conclusions echo European Commission's October Progress Report, and stresses once again its openness to a negotiated solution.

Nicosia, Cyprus, 17 December 2014 – Central European Aluminium Company (CEAC), a Cyprus-based major shareholder and one of the largest creditors of Montenegro's Kombinat Aluminijuma Podgorica (KAP), welcomes the conclusions of the EU's General Affairs Council urging the Montenegrin government to fight corruption at the highest levels and improve its business environment. 

In its conclusions, the Council endorsed "the Commission's increased focus on strengthening economic governance and competitiveness, with the aim of improving the business environment and boosting growth, job-creation and investment". In particular, the Council concluded that within Montenegro a "strong political commitment is required" to secure "tangible and lasting results" in this area.

The Council Conclusions endorse the findings of the Commission's October 2014 Progress Report, which spoke of the "risks of a new round of contingent liabilities for the public finances" as a result of ongoing international arbitration cases against the State of Montenegro initiated by CEAC following the illegal expropriation of the company in summer 2013. CEAC's arbitration claims against Montenegro amount to some €900m, almost 30% of the country's GDP. 

The Council also stressed that a number of shortcomings identified in the Commission's Progress Report need to be tackled urgently and decisively, in particular in the areas of the judiciary, fundamental rights, and respect of the rule of law, "including with respect to the fight against corruption, notably at high level" – perhaps the Council's most scathing criticism of the culture of corruption that reaches throughout all levels of the Montenegrin state.

In a clear warning – echoing the Commission's own – that Montenegro's eventual EU accession is predicated on lasting, fundamental and meaningful change on the ground, the Council concludes that "strengthening administrative capacities on EU-integration issues will be essential [for Montenegro] to maintain a positive momentum on the EU path".

Commenting the Council's conclusions of the European Commission's progress report on Montenegro's progress toward EU accession, CEAC's external legal counsel Matthias Menke, said:

"We are extremely encouraged by the very clear message that EU ministers have sent the Montenegrin government on the need to put its house in order if it wants to stand a chance of becoming an EU member. Following hot on the heels of the Commission's own criticisms, we can only hope that the Montenegrin government will at last take seriously the need for a negotiated solution to KAP, which the European Parliament also recently stated is a major obstacle in Montenegro's progress on the EU path. With the Council's conclusions we now we have a unified chorus of all three major EU institutions. KAP is an unfortunate case study in that it illustrates most of the shortcomings of Montenegrin government behaviour which is hampering Montenegro's accession progress. The non-respect and complete disregard of the Nicosia Court injunction blocking the sale of the KAP plant and disposal of its assets (including its stock) is just another example which shows how the country is far from EU standards not only in terms of transposition of the EU acquis but also in terms of basic respect of the rule of law. The Montenegrin government must urgently sit around the table and negotiate a reasonable settlement to the KAP dispute."

 

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