BH & EU

Analysis: Implementation of the SAA and BiH’s Approximation of Legislation to the EU Acquis in Trade

Representatives from the European Commission and Bosnia and Herzegovina (BiH) met via a videoconference on 22 April 2021 to discuss the implementation of the SAA and BiH’s approximation of legislation to the EU acquis in the field of trade, industry, customs and taxation. The meeting was co-chaired for Bosnia and Herzegovina by Mrs. Brankica Pandurević, Assistant Minister for economic development and entrepreneurship from the BiH Ministry of Foreign Trade and Economic Relations, and for the EU by Mrs. Ingrid Jenezova,permanent secretary for the sub-committee, from the Directorate General for Neighbourhood and Enlargement Negotiations of the European Commission.

At the meeting, the parties discussed developments in these areas and exchanged detailed trade statistics. The Commission urged Bosnia and Herzegovina to step up considerably its efforts to enhance institutional and administrative capacities, coordination and legal framework in all related areas, and recalled the importance of countrywide sector strategies.

On trade matters, the EU noted that COVID-19 pandemic had a heavy impact on trade worldwide. Exports from BiH to the EU fell in 2020 by 7.3% and imports from the EU fell by 12.2%. The EU remains Bosnia and Herzegovina’s first trading partner, accounting for 65.1% of total trade. The EU noted that the autonomous trade measures regime for exports of certain fruits, vegetables and wine from the Western Balkans to the EU had been extended for a period of 5 years to end 2025, which has proven to be a valuable support for BiH’s exporters. In this context, the EU reminded BiH of the importance of respecting the provisions of the SAA with regard to trade, in order to continue to benefit from its enhanced access to the EU market. The EU urged to finalise and adopt the Law on Excise Duties and a Rulebook in line with the acquis, in order to ensure that the same conditions for importers and local producers, including for small breweries. The EU also encouraged BiH to intensify and conclude its pending bilateral negotiations with a view to concluding its accession to the WTO.

On the free movement of goods, the EU noted BiH initial steps to develop a countrywide quality infrastructure strategy and it looks forward to reviewing the final draft. The EU welcomes the appointment of members of the Metrology Council.

On taxation, the EU welcomed the ratification of the OECD/Council of Europe Multilateral Convention on Mutual Administrative Assistance in Tax Matters (MAC) and encouraged BiH to adopt the new VAT and excise legislation to further align with the EU acquis. In the area of customs, the EU invited BiH to keep the envisaged schedule to implement the next phase of the New Computerised Transit System (NCTS). It also encouraged BiH to implement the e-signature countrywide and to ensure the inter-operability of different e-signatures across the country. BiH was urged to adopt a new law on electronic identity and trust services for electronic transactions with a single supervisory body for the whole country in line the EU acquis.

The EU stressed the need for a harmonised countrywide approach to the planning and implementation of SME and industrial policies, also in view of building up economic resilience following the COVID-19 pandemic. In particular, the EU encouraged the finalisation and adoption of strategic guidelines for harmonisation of SME and entrepreneurship support. The EU recalled that to facilitate post-pandemic recovery, there is strong need for effective and well-coordinated structural reforms. Actions to put state-owned enterprises on equal footing with other industrial enterprises to enhance growth potential were discussed. Strong commitment and constructive engagement by all partners by all WB6, including BiH, is required to implement the Common Regional Market, a catalyst for deeper regional economic integration and a stepping stone towards the EU single market.   In the area of public procurement, the EU urged BiH to end preferential treatment of domestic bidders without further delay and restore compliance with the SAA in this area. Finally, the EU stressed the need to implement measures foreseen in the Economic Reform Programme as well as the Policy Guidance based on the Economic and Financial Dialogue.

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