2001 20001998 - 1999
MINISTRY OF FINANCE AND ECONOMY
on talks between the representatives of the Government of the Republic
of Montenegro and the Government of the Republic of Serbia between June
24 and July 8 in Budva and Belgrade for the purpose of determining activities
for further implementing the Belgrade Agreement and harmonizing their economic
systems with the EU economic system.
Podgorica, July 8, 2002
Experts met in six task forces: free circulation of goods, capital, services and people, organization of work and financing future institutions of the State Union.
The results of the task forces were collected at the meeting and harmonized
into a text Activities Plan for providing free functioning of common market
The governments of the Republic of Montenegro and Serbia, with the participation
of the representatives of the federal government, elaborated the models
II. HARMONIZATION ACTIVITIES PLAN
Based on the level of reforms that has been reached in the member states,
and for the purpose of regulating mutual economic relations, we have come
II. 1. In the sector FREE CIRCULATION OF GOODS a harmonized text (Annex 2) with the contents as follows is signed:
1. Customs territory - we shall immediately regulate the existing administrative customs border which will be lifted in three year time.
Competent authorities for implementation of these measures are as follows:
Serb Customs Authority, Montenegro Customs Authority, ministries of interior
2. Customs procedure shall be regulated in the Customs Cooperation Agreement,
which will regulate submission of all the documents for crossing the
Competent authorities: Serb Customs Authority, Montenegro Customs Authority,
the ministries of interior, health and agriculture of the member states,
3. Customs rates - We shall proceed with the development of the study
for effective level of protection in both member states (determining
Competent authorities: the ministries of finance of the member states,
Task Force for Customs Harmonization (the representatives of the member
states and the
4. International treaties - Through a common branch association, Serbia
Chamber of Commerce and Montenegro Chamber of Commerce shall continue
Competent authorities: Serbia Chamber of Commerce and Montenegro Chamber of Commerce, Serb Customs Authority, Montenegro Customs Authority.
5. In the sector of veterinary, sanitary and fit sanitary control it
was agreed to set up one instance internal supervision , affiliated to
the State Union
6. In foreign trade regime it is planned to develop a study on actual
protection in both member states. In the first and second year we shall
7. Free Trade Agreement - since the implementation of the agreements
concluded by the FRY on the free trade zones on the territory of
Competent authorities: The State Union Ministry for Economic Relations
with Abroad, the ministries of the member states in charge of foreign and
8. In order to become member of the WTO it was agreed to develop negotiation
strategy, to determine target level of protection and update the list of
Competent authorities: The State Union Ministry for Economic Relations
with Abroad, the Commission of the State Union and commissions of the member
9. In the process of harmonizing with EU we are planning to develop
a study on the customs and foreign trade regimes. In the first year it
is planned to adopt
10. Removing obstacles for internal trade - we shall immediately identify
obstacles. In the first year we shall develop the Obstacles Removal Plan
Competent authorities: The State Union Ministry of Internal Economic
Relations, the ministries of the member states for internal policy, finance,
11. Tax System - Regarding the Agreement on Avoiding Double Taxation,
it was agreed to study existing agreements and to have them implemented
Competent authorities: The State Union Ministry for Economic Relations with Abroad, the tax authorities and the ministries of finance of the member states.
12. Tax and rates - in the excise sector, existing differences
shall be identified immediately regarding products that excise apply to
and the level of excise
During the third year we are planning to have the member states tax systems harmonized with EU standards.
Competent authorities: the ministries of finance and tax authorities of the member states.
13. Authorities in charge of supervising circulation of goods (Institute
for Standardization, Institute for Intellectual Property and Institute
II.2 In the area of FREE CIRCULATION OF CAPITAL it is agreed that we
shall apply, since there are different regulations in the two republics
II.3 In the sector of FREE CIRCULATION OF SERVICES it was agreed as follows:
Based on the monetary and banking systems the following was agreed:
1. Monetary system. There are two separate monetary systems, two central
banks and two different currencies as legal payment instruments. These
2. Banking system. There are two separate banking systems regulated
with separate laws which are in principle harmonized with the principles
of the Basel
2.1. Licensing . Each central bank shall issue licenses for commercial banks to operate, banking entities and other financial institutions in its territory.
2.2. Bank Supervision. National Bank of Serbia and Central Bank of Montenegro
shall set up cooperation in supervision and secure exchange of
3. Payment System. We shall analyze technical conditions for having
payment system functioning between natural and legal persons in both currencies
4. Relations with International Financial Organizations. In order to
have representatives of Serbia and Montenegro in International financial
5. The issue of introducing the banks from Montenegro into SWIFT system.
National Bank of Serbia shall support the banks from Montenegro having
II.4 In the area of FREE CIRCULATION OF PEOPLE it is agreed as follows:
In the sector of labor, employment, education and veteran-disability
protection, in the system of the member states a high level of harmonization
is achieved and
In the area of pension and disability insurance the differences in the
member states are identified, such as conditions for exercising the right
It is agreed that the system in the area of labor, employment, health,
education pension and disability insurance as well as veteran-disability
protection shall be
Every member state shall have its representative for signing international
treaties in the area of social insurance, international conventions in
the area of labor and
III. ORGANIZATION AND PROCEDURE OF ACTIVITIES OF THE MINISTRIES OF THE
STATE UNION OF SERBIA AND
All existing federal authorities and organizations shall cease to function at the moment of setting up of new authorities in line with the Constitutional Charter.
1. The State Union of Serbia and Montenegro, in line with the starting
elements for reorganizing relations between Serbia and Montenegro, shall
2.The ministries of the State Union shall harmonize and coordinate work
of the authorities of the state administration of the member states, represent
Harmonizing and coordinating is done through communication of a ministry
of the State Union and authorities of the state administration of the member
3. Organization, authority and work of the ministries of the State Union are regulated by the regulation of the State Union in line with the Constitutional Charter.
4. The ministries of the State Union are seated in Belgrade, i.e. Podgorica.
The seat of the ministry of the State Union shall be regulated by the rule
5. If the laws of the member states are not harmonized or powers of authorities of the member states this shall be regulated by the State Union legislation.
III.2 Ministries of the State Union
1. The Ministry of Foreign Affairs
This Ministry shall be in charge of foreign affairs of the State Union,
international treaties, international cooperation and protecting interests
of the State Union
2. Ministry of Defense
This Ministry shall be in charge of the defense of the State Union.
3. State Union Ministry for Economic Relations with Aboard
The Ministry, in line with the office granted by the member states shall
be in charge at the level of the State Union of the process of association
4.The State Union Ministry of Internal Economic Relations
The Ministry shall coordinate and harmonize economic systems of the
member states, in order to have common market functioning, including free
5. Ministry for Protection of Human and Minority Rights.
The Ministry shall coordinate the activities of the authorities of the
member states state administration in order to implement international
III.3.The Procedures of work of the ministries of the State Union
1. The ministries of the State Union act on administrative matters in
line with the procedure determined by the laws of the member states, by
2. Rights, obligations and responsibilities of the elected, appointed
and persons employed in the State Union ministries are regulated by the
member states, by
3. Engagement of the member states in the State Union ministries shall be regulated by a separate agreement of the member state governments.
IV FINANCING AND PROPERTY OF THE STATE UNION OF SERBIA AND MONTENEGRO
Activities of the State Union of Serbia and Montenegro (hereinafter:
the State Union) shall be financed by fees allocated from the member states
Expenditures of the State Union are approved by the member states parliaments.
Execution and auditing of expenditures of the State Union is carried out
Internal auditing is done by budget inspections of the ministries of
finance of the member states, and external auditing by top auditing institutions
of the member
Expenditures of the State Union shall be presented by GFS classification
and part of the budget of the member states. The State Union shall be financed
The funds directly gained by the authorities of the State Union shall
be the revenues of the budget of the member states. These funds shall be
IV.2 Property and debts
The State Union does not have its own property and can not get
loans. The existing movable and immovable property of the FRY shall be
The property abroad (diplomatic and consular offices) shall not be divided
and shall remain as a common property of the member states. The authorities
The issue of split of assets (e.g.foreign currency reserves) and debts shall be resolved at the latest by the end of 2002 in the agreement of the member states.
Last updated Jan 2002