Europaudvalget 2003-04
EUU Alm.del Bilag 181
Offentligt
Comprehensive monitoring report
on
Lithuania’s
preparations for membership
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A.
B.
INTRODUCTION ................................................................................................................................ 3
ECONOMIC ISSUES ........................................................................................................................... 5
1.
Economic developments ........................................................................................................... 5
2.
Implementation of recommendations for improvements........................................................... 7
COMMITMENTS AND REQUIREMENTS ARISING FROM THE ACCESSION
NEGOTIATIONS ................................................................................................................................. 9
1.
Administrative and judicial capacity....................................................................................... 11
Public administration............................................................................................................... 11
Judicial capacity ...................................................................................................................... 12
Anti-corruption measures........................................................................................................ 13
Translation of the acquis into Lithuanian................................................................................ 14
2.
The chapters of the acquis....................................................................................................... 16
Chapter 1: Free movement of goods....................................................................... 16
Chapter 2: Free movement of persons .................................................................... 18
Chapter 3: Freedom to provide services ................................................................. 19
Chapter 4: Free movement of capital...................................................................... 21
Chapter 5: Company law ........................................................................................ 22
Chapter 6: Competition Policy ............................................................................... 23
Chapter 7: Agriculture ............................................................................................ 24
Chapter 8: Fisheries ................................................................................................ 28
Chapter 9 Transport................................................................................................ 29
Chapter 10: Taxation .............................................................................................. 31
Chapter 11: Economic and monetary union ........................................................... 32
Chapter 12: Statistics .............................................................................................. 33
Chapter 13: Social policy and employment............................................................ 33
Chapter 14: Energy................................................................................................. 35
Chapter 15: Industrial policy .................................................................................. 37
Chapter 16: Small and Medium-sized Enterprises ................................................. 37
Chapter 17: Science and research ........................................................................... 38
Chapter 18: Education and training ........................................................................ 38
Chapter 19: Telecommunications and information technologies ........................... 38
Chapter 20: Culture and audio-visual policy .......................................................... 39
Chapter 21: Regional policy and co-ordination of structural instruments.............. 40
Chapter 22: Environment........................................................................................ 42
Chapter 23: Consumer and health protection ......................................................... 44
Chapter 24: Justice and home affairs...................................................................... 45
Chapter 25: Customs union .................................................................................... 48
Chapter 26: External relations ................................................................................ 50
Chapter 27: Common foreign and security policy.................................................. 51
Chapter 28: Financial control ................................................................................. 51
Chapter 29: Financial and budgetary provisions .................................................... 52
CONCLUSION................................................................................................................................... 54
C.
D.
STATISTICAL ANNEX.............................................................................................................................. 56
2
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A.
I
NTRODUCTION
The accession negotiations with Lithuania were successfully concluded on 13 December
2002 and the Treaty of Accession was signed on 16 April 2003. In a referendum held on
10-11 May 2003, a majority of Lithuanians expressed their support for membership of
the European Union. Following ratification of the Treaty of Accession, Lithuania will
join the EU on 1 May 2004.
In its Strategy Paper “Towards the enlarged Union”, which accompanied the 2002
Regular Reports, the Commission stated that:
“Acceding countries need to implement the acquis by the date of accession, except in
cases where transitional arrangements have been agreed. Commitments undertaken
in the negotiations must be fully met before accession. The Regular Reports point to
a number of areas where further improvements need to be made in the context of the
political and economic criteria and in relationship to the adoption, implementation
and enforcement of the acquis. These should be vigorously pursued. In order to
analyse progress and to facilitate successful membership of the European Union, the
Commission will regularly monitor this and report to Council. The Commission will
produce six months before the envisaged date of accession a comprehensive
monitoring report for the Council and the European Parliament.”
The Copenhagen European Council in December 2002 concluded that:
“Monitoring up to accession of the commitments undertaken will give further
guidance to the acceding states in their efforts to assume responsibilities of
membership and will give the necessary assurance to current Member States.”
and the Thessaloniki European Council in June 2003 stated that:
“…the ten acceding States are encouraged to keep up their efforts so that they are
fully prepared to assume the obligations of membership by accession. This also
includes the necessary translation of the Community acquis. With a view to making a
success of enlargement, the monitoring of these preparations has been intensified on
the basis of reports submitted regularly by the Commission.”
As the accession date of 1 May 2004 draws closer, this report presents a comprehensive
state of play of the findings of the regular monitoring carried out by the Commission,
building upon the findings of the 2002 Regular Report for Lithuania. The report contains
two main parts.
The first part deals with economic issues. It describes briefly economic developments in
Lithuania, and then goes on to assess the implementation of the necessary economic
reforms in the areas highlighted in the conclusions of the 2002 Regular Report for
Lithuania as being in need of further improvements.
The second part gives an overview of where Lithuania stands in implementing all
commitments and requirements arising from the accession negotiations for each
acquis
chapter, both in terms of legislation and from the perspective of implementing structures,
including administrative capacity and enforcement. In view of their importance for the
implementation and enforcement of the
acquis,
the overall state of readiness of the public
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administration and the judicial system and the development of effective anti-corruption
measures are assessed in an introductory section to this part.
This report reflects the situation at the end of September 2003. It records decisions
actually taken, legislation actually adopted, measures actually implemented and
structures actually in place and functioning by that date.
For each chapter of the
acquis,
this report identifies the areas in which Lithuania is
expected to be, or is already, in a position to implement the acquis and the areas where
further action is still needed. Where relevant, the report also points out issues where
lagging or deficient preparations are a cause of serious concern. This assessment starts
from the premise that Lithuania must be prepared for membership from the date of
accession. In cases where transitional arrangements have been agreed in the accession
negotiations, their effect on Lithuania’s obligations is duly reflected in the assessment.
Numerous sources of information have been used to compile this report. Lithuania was
invited to provide information on its state of preparedness. The Report also draws on
information provided by Lithuania within the framework of the Association Agreement
and the accession negotiations, as well as on peer reviews that have taken place to assess
its administrative capacity in specific areas. Council deliberations and European
Parliament reports and resolutions have been taken into account in drafting it.
1
Where
relevant, the Commission has also drawn on assessments made by various international
organisations such as the Council of Europe, the OSCE and the international financial
institutions, and by non-governmental organisations.
1
For the European Parliament the rapporteur is Mr Ioannis Souladakis.
4
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B.
ECONOMIC ISSUES
In its 2002 Regular Report, the Commission concluded that
“Lithuania is a functioning market economy. The continuation of its current reform
path should enable Lithuania to cope with competitive pressure and market forces
within the Union.
Improvements can be made to the labour market by addressing the high
unemployment. The management of public finances should be improved, in
particular by addressing, at municipal level, the accumulation of expenditure
arrears. Furthermore, the completion of the pension reform, by the planned
introduction of a funded compulsory pension scheme, should make public finances
more sustainable in the long term and support the development of financial markets.
In addition, strengthening the administrative and judicial capacity, and simplifying
procedures, in areas relevant for the business sector, including in bankruptcy and
enterprise restructuring, would enhance market entry and exit of companies.”
The principal purpose of this part of the Comprehensive Monitoring Report is to assess
the implementation of recommendations for improvements in the areas identified in last
year’s Regular Report. The focus is on the change since last year and not on the overall
degree of functioning of the market economy or degree of competitiveness. The
assessment can be found in Section 2. Section 1 briefly describes recent economic
developments in Lithuania including the continuation of the reform path since last year’s
Report.
1.
Economic developments
In spite of lacklustre growth in the EU, macroeconomic performance in Lithuania remained
particularly strong during 2002.
Real GDP continued to grow unabated, reaching some 6.7
percent in 2002, aided by strong growth in domestic demand—particularly investment and
private consumption. Growth accelerated further to 9.4% in the first quarter of 2003,
compared with the same quarter of 2002. Strong productivity growth, moderate wage
inflation, and the large appreciation of the Litas—first during the peg against the dollar and
subsequently the euro—all contributed to the fall in prices by almost 1% in 2002. The trend
persisted during 2003, and inflation fell by some 1.% in August compared with the same
month one year earlier. The situation in the labour market improved markedly, with a higher
employment rate (at 59.9%) and a decrease in the unemployment rate from 17.4% in 2001
to 13.8% in March 2003. The authorities remained firmly committed to the fiscal
consolidation programme, and accordingly the general government deficit declined further
to 1.7% of GDP in 2002, according to recently updated data. The current account balance
deteriorated somewhat from 4.8% of GDP in 2001 to 5.3% in 2002, mainly as a result of a
worsening in the trade balance and the balance of current transfers. Foreign direct
investment inflows grew by nearly 50% in 2002 and, represented some 5.3% of GDP, thus
fully covering the current account deficit.
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Lithuania
Real GDP growth rate
Inflation rate
- annual average
- December-on-
December
Unemployment rate
- LFS definition
General government
budget balance
Current account balance
per cent
per cent
per cent
Main Economic Trends
1998
1999
2000
7.3
5.0
-1.8
0.7
4.0
0.9
2001
6.5
1.3
2002
6.7
0.4
2003
latest
9.4 Q1
-1.0
August
a
-0.9
August
13.8 Q1
2.4
11.8
per cent
per cent of
GDP
per cent of
GDP
Million
ECU/Euro
Per cent
of exports
of goods
and
services
Million
ECU/Euro
Per cent
of GDP
-3.1
-11.9
0.3
11.2
-5.7
-11.2
1.3
15.7
-2.6
-6.0
2.1
16.1
-2.2
-4.8
-0.9
13.1
-2.0 p
-5.3 p
b
Gross foreign debt of the
whole economy
- debt export ratio
-1158
36.4
-1120
61.6
-731
56.4
-641
48.8
-772
:
-462 Jan.-
July
b
1 646
8.5
2 450
4.6
3 120
3.4
3 293
3.7
:
5.3 p
Foreign direct investment
in flow
- balance of payments
data
Million
826
456
ECU/Euro
Sources: Eurostat. National sources. OECD external Debt Statistics
a
Moving 12 months average rate of change.
b
Source: Website of the National Bank.
P= provisional figures
410
497
772
b
184 Jan.-
July
b
The authorities actively pursued their reform path, although a number of areas—
including pension and fiscal structural reform — still require progress.
The privatisation
of state-owned enterprises advanced significantly, and in some sectors (e.g., the banking
sector) is complete. Considerable progress has been achieved in revamping the legal
framework for bankruptcy and enterprise restructuring. Recently enacted legislation will
facilitate entry and exit from the market, and stimulate further the business environment
and more generally the labour market. The planned pension reform is a positive
development, but the proposed changes seem unambitious and fall short of what is
needed for establishing a well-capitalised contribution-defined second pillar. The
completion of the current reform programme depends on a continued broad consensus on
the main orientations of economic policy.
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I
Main Indicators of Economic Structure in 2002
Population (average)
GDP per head
a
Thousand
PPS
Per cent of EU average
3,469
39
7.1
18.6
21.5
24.8
54.1
2508
723
7.0
Share of agriculture in:
- gross value added
- employment
Gross fixed capital formation/GDP
Per Cent
Per Cent
Per Cent
b
c
Gross foreign debt of the whole economy/GDP Per Cent
Exports of goods & services/GDP
Stock of foreign direct investment
Long term unemployment rate
Source: Eurostat
a
b
c
d
d
Per Cent
Million Euro
Euro per head
Per Cent of labour force
Figures have been calculated using the population figures from National Accounts, which may differ from those used in demographic statistics.
Agriculture, hunting, forestry and fishing.
Data refer to 2001.
Data refer to 2000.
2.
Implementation of recommendations for improvements
Although
fiscal policy
remains firmly committed to further consolidation, several factors
could put at risk the government’s fiscal objective, and hence call for the formulation of
a comprehensive fiscal strategy that takes into account all pending financial obligations
of the central and local governments.
In particular, the state of municipal finances, the
potential costs of pension reform, and plans to proceed with the savings and real estate
restitution scheme are likely to strain the public finances in the medium term. Recent
changes in the funding procedures for municipalities — which essentially raise the share
of government transfers relative to other income from direct taxation, and improve the
equalisation mechanism intended to help poorer municipalities — should support
(particularly smaller) municipalities, and assist them in formulating and executing their
budgets. The reforms set out a repayment strategy for the municipalities’ arrears, which
in 2002 amounted to 200 million Litas (or some 0.5 % of GDP), but do not provide solid
measures to dissuade local governments from accumulating new arrears.
2
Hence,
although some progress has been made, the finances of the municipalities continue to
pose a major risk to the government's fiscal strategy. Progress towards fiscal
consolidation masks, to some extent, lack of progress in pension reform. The decision to
proceed with a voluntary contribution-defined second pillar could postpone the fiscal
costs of the reform, which are likely to be significant. Furthermore, sizeable liabilities
related to the savings and real estate restitution, which amount to 6.8% of GDP, will have
to be financed over the next few years; with 105 million Litas—a mere 0.2 % of GDP —
budgeted for repayment for saving restitution in 2003.
3
Revenue collection is another key
issue in Lithuania as a result of pervasive tax evasion, and of loopholes in the tax system.
It is imperative that the government outlines in its medium-term fiscal plan all financial
2
Some 65 million Litas out of the transfers from the central government is now earmarked for a repayment
of municipalities arrears in 2003.
The financial obligation include 3.7% of GDP for the savings restitution plan, and some 3.1% of GDP for
real estate restitution.
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obligations (e.g. total cost of pension reform, the costs related to the savings restitution
program, etc.), and presents detailed plans for financing in the medium term. The
credibility of such a medium-term plan would be enhanced if it were supported by solid
measures to improve tax collection (including tackling tax evasion, and simplifying the
tax code to close holes in the system), and restraint spending by the municipalities.
The problem of high and persistent
unemployment
is being addressed through active
labour market policies but implementation of these policies is crucial.
Solid employment
growth in 2002 and early 2003, combined with a small decline in the labour force,
contributed to a significant fall in the unemployment rate from 17.4% in 2001 to 13.8%
in March 2003 (as measured by the ILO definition). The recovery in the labour market in
2002 was the result of a buoyant economy and, to some extent, recent policy measures
that were aimed at tackling the unemployment problem. In particular, new measures have
been introduced to stimulate employment in depressed areas (e.g., new amendments to
the Law on Support to the Unemployed) through subsidised job creation, and other
polices which are aimed at reinvigoating local economic activity. Several policies have
been identified, particularly in the “Joint Assessment of Employment Policy Priorities
and the subsequent progress reports, which address a number of key issues in the labour
market in Lithuania. The large share of the long-term unemployed suggests that
structural unemployment could become a serious hurdle to any further improvement in
labour market in Lithuania, and hence implementation of these policies is key in bringing
about a long-lasting recovery in the labour market
Pension reform
has advanced with the adoption of legislation by the parliament, but the
current plans fail to address the problem of an impending social security deficit. The law
on pension reform adopted by parliament in December of 2002 established a voluntary
contribution-defined second pillar contrary to the government’s original plan for a
system with compulsory participation — at least, for specific (e.g. younger) age groups
— and established the contribution rate pertaining to the second pillar; initially at 2.5%
of earnings, although this is set to increase to 5.5% by 2007. Both decisions, to opt for
voluntary second pillar participation and to set a rather low contribution rate for the
second pillar, are problematic and could significantly delay any meaningful reform. Such
a reform should entail compulsory participation of younger-age cohorts, and a gradual
adjustment of contribution rates to the second pillar to ensure a stable and acceptable
pension level for retirees. At the same time — and in order to enhance transparency and
the credibility of the government’s fiscal policy objectives — the fiscal costs related to
the reform ought to be integrated in the government’s medium-term fiscal plan.
Considerable progress has been achieved in improving
administrative and judicial
capacity,
specifically pertaining to the legal framework for bankruptcy and enterprise
restructuring and market entry, but the authorities must proceed to complete their reform
programme without delay. Simplified bankruptcy procedures were introduced in
December of 2002, and a manual on bankruptcy procedures was prepared, while the
Bankruptcy Law was amended in order to enhance the process of appointing
administrators. In addition to legal and institutional changes, the authorities made
significant progress in strengthening administrative capacity through the training and
development of staff. These improvements have already had a noticeable impact on the
pace of bankruptcy proceedings and should contribute further to creating a dynamic and
efficient business climate in Lithuania. Progress has been made also toward the
simplification of administrative procedures for market entry and these developments are
likely to stimulate further economic activity, and employment growth. The government is
indeed committed to completing this reform.
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C.
C
OMMITMENTS
NEGOTIATIONS
AND
REQUIREMENTS
ARISING
FROM
THE
ACCESSION
As we approach the actual date of accession and the entry into force of the mutual rights
and obligations enshrined in the Treaty of Accession, it is necessary to focus efforts on
ensuring that Lithuania is fully prepared in all areas of the
acquis
from the start of its
membership. In other words, Lithuania must meet its commitments and requirements
arising from the accession negotiations.
In the 2002 Regular Report on Lithuania, the Commission found that:
“Lithuania
is generally meeting the commitments it has made in the negotiations.
However, delays have occurred with regard to fisheries (completion of the fishing
vessels register), statistics (conduct of the agricultural census) and environment
(legislation on packaging and on biocides). These issues need to be addressed.
Bearing in mind the progress achieved since the Opinion, the level of alignment and
administrative capacity which Lithuania has achieved at this stage, and Lithuania’s
track record in implementing the commitments it has taken in the negotiations, the
Commission considers that Lithuania will be able to assume the obligations of
membership in accordance with the envisaged timeframe. In the period leading up
to accession, Lithuania needs to continue its preparations, in line with the
commitments it has made in the accession negotiations.”
As regards the administrative capacity to implement the acquis, the overall findings were
as follows:
“As regards administrative capacity, Lithuania has achieved a sufficient, though
still rather fragile, capacity to ensure effective implementation and enforcement of
the acquis, notably in the area of internal market and the various Community
policies. Lithuania needs to ensure the administrative structures are fully
operational, in particular with a view to guaranteeing the uniform and predictable
implementation of the acquis. Particularly close attention is required regarding the
structures, which are necessary to implement that part of the acquis which will be
applicable only upon accession, in particular as regards sound and efficient
management of EC funds.”
As part of its continuous monitoring, the Commission services addressed a letter to
Lithuania in February 2003 expressing concern over its preparedness in the field of
capital movements and payments systems within the chapter on free movement of capital
and calling for urgent action to remedy these shortcomings.
In order to give further guidance to Lithuania in its preparation efforts and to give the
necessary assurance to current Member States and other future Member States, this part
of the comprehensive monitoring report, in Section 2, gives an overview of where
Lithuania currently stands in implementing all commitments and requirements arising
from the accession negotiations for each of the 29 chapters of the
acquis.
It covers the
whole body of
acquis,
on a chapter-by-chapter basis, both in terms of legislation and
from the perspective of implementing structures, including administrative capacity and
enforcement.
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The principal commitment undertaken by Lithuania in the accession negotiations is to be
fully prepared for membership in all areas by the date of accession. In a number of areas,
however, commitments were made to put in place and implement the
acquis
according to
specific timetables even before accession. This report examines the extent to which these
commitments have been met, and where delays have occurred, but the principal focus of
the assessment remains the requirement that Lithuania must be fully prepared as from
accession. Naturally, in cases where transitional arrangements have been agreed, their
effect on Lithuania’s obligations is duly reflected in the assessment. On the other hand, it
should be underlined that, in order for Lithuania to make effective use of its eligibility
for Community structural funds from 1 January 2004, the relevant
acquis
in areas such as
public procurement, state aid and environmental protection will need to be fully
respected from 1 January 2004 in relation to the implementation of structural funds
actions
4
.
For each chapter, a conclusion is provided, which is structured in the following way.
Firstly,
it identifies those areas where Lithuania is essentially meeting the commitments
and requirements arising from the accession negotiations and is expected to be, or is
already, in a position to implement the
acquis
from accession. This does not exclude the
possibility that certain actions are still to be taken, but these should under foreseeable
circumstances not pose particular difficulties.
In a
second
paragraph, the assessment identifies any areas where important further action
is still needed in order to complete preparations for membership. In some cases these
preparations are ongoing, but enhanced efforts or quicker progress may be called for.
These are issues which can still be remedied taking into account the accession date of 1
May 2004 but which require the special attention of the authorities.
Thirdly,
where relevant, the assessment also identifies issues that are of serious concern.
These are areas where serious shortcomings exist which are likely to persist after
accession unless immediate remedial action is taken. These issues require the urgent
attention of the authorities. In view of their importance for the implementation and
enforcement of the
acquis,
the
overall
state of readiness of the public administration and
the judicial system and the development of effective anti-corruption measures, together
with the question of the translation of the
acquis
into Lithuanian, are evaluated in a
separate Section 1.
4
See also the Commission Communication "on the implementation of commitments undertaken by the
acceding countries in the context of accession negotiations on Chapter 21 - Regional policy and
coordination of structural instruments", 16 July 2003 (COM(2003) 433 final).
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1.
Administrative and judicial capacity
Public administration
The reform of the public administration is well on track, notably in terms of increased
stability and professionalism of the civil service. Continued efforts and resources remain
necessary to consolidate the administrative system, which is still fragile.
The legal framework of the civil service is in place. The 2002 Civil Service Law and the
subsequent implementing legislation reinforced the application of the principles of rule
of law, political neutrality, equality and transparency. This reform led, in particular, to a
clear distinction between political posts and career posts. The recruitment system was
reformed successfully, notably by increasing the objectivity and the transparency of the
examination procedures. As regards the promotion system, the new legislation has
introduced an annual performance-based evaluation procedure; however, the reliability
of this evaluation procedure needs to be proven. The remuneration system has improved
but managers still have wide discretionary power in interpreting the remuneration
parameters and determining the actual pay of civil servants.
Thanks to the reforms, the public sector is becoming increasingly attractive to highly
qualified specialists. Nevertheless, a number of them subsequently leave for the private
sector where higher salaries are available. Better remuneration would help retain skilled
professionals and together with the effective implementation of the Rules of Ethics that
were adopted in 2002 would contribute to curbing petty corruption. Continued attention
should be paid to improving the quality of the local administration in the ten counties and
sixty municipalities of Lithuania.
The new legislation set up a Department of Public Administration under the Ministry of
the Interior. This department, which became operational in December 2002, is
responsible for formulating policy proposals, drafting implementing legislation,
approving training programmes and managing the register of civil servants, which is
currently being set up. This institutional set-up should help ensure that the civil service
reform is properly implemented throughout all services and that further developments of
the public administration system take place in a structured way.
Although the situation has improved, most ministries are still understaffed and are likely
to face challenges when implementing the acquis and managing of Structural Funds after
accession. This is primarily due to lack of funds, but also sometimes to the fact that
strategic management is still at an early stage. Although inter-ministerial co-operation
has, in general, improved, the situation in this field is still not satisfactory, as co-
operation is rarely systematic, either on the political or on the senior management level.
Significant progress has taken place as regards training. All government institutions have
to allocate for training between 1 and 5 % of the amounts allocated for salaries.
However, actual spending for training has fallen short of this objective. The Lithuanian
Institute of Public Administration, which is the national training agency, has significantly
increased its capacities. The training courses cover a wide range of issues: improvement
of management skills, European affairs and strategic management for Structural Funds.
The training courses are open for national and local civil servants as well as for elected
officials and representatives of the private sector. In addition, in the framework of the
training programme for those civil servants that will represent Lithuania in European
institutions, around 300 civil servants are expected to be trained by the end of 2003.
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As regards the internal co-ordination on EU affairs, the European Committee under the
Lithuanian Government which has played a key co-ordination role during the EU
accession negotiations will be transformed into a new “Government EU Affairs
Secretariat” under the Prime Minister’s office. This body will be responsible for
strategic planning in EU-related matters, for preparing a common Lithuanian position in
EU matters and for identifying the competent institution for the implementation of EU
policies. It is important that the new structure become operational in time. The
competencies of the former European Committee related to the setting up of the Single
Market will be handed over to the Ministry of Economy.
Judicial capacity
The reform of the legal system and of the judiciary is almost completed. The 2002 Law
on Courts has significantly contributed to consolidating the independence of the
judiciary, and improving its functioning. The judiciary should be further strengthened,
through additional staff, training and equipment. Sustained efforts need to be devoted to
the respect of professional ethics.
The new Code of Civil Procedure entered into force on 1 January 2003 and the Code of
Criminal Procedure, Criminal Code and the Code of Enforcement of Punishment entered
into force on 1 May 2003. The new criminal legislation introduces the pre-trial judge,
speeds up the proceedings, secures the rights of the defendant more efficiently than the
present legislation and provides for alternative sanctions. According to the new
procedures, the higher courts will play a stronger role in guaranteeing uniform court
practice. While it is still early to assess the impact of the new codes, in particular on
reducing the duration of court procedures and the backlog of cases, particular attention
should be paid to the effective implementation of the new rules, in particular on pre-trial
investigation and on cross-examination. The new Code of Administrative Offences has
been adopted recently.
The introduction of compulsory in-service training has further improved the professional
capacity of judges. The Judicial Training Centre has confirmed its key role by providing
training courses on the new codes, the acquis and human rights law. According to the
law, the State budget allocations made available for training should amount to no less
than 1.5 % of the amounts allocated for judges' salaries. However, actual spending falls
short of the set targets. The Ministry of Justice and Council of Courts need to work
constructively together with the Judicial Training Centre to co-ordinate the development
and delivery of judicial training.
The planned development of the court information system needs to be carried out on time
as it will be of great importance in improving the management of the judicial workload.
The newly established institutions ensuring judicial autonomy, notably the Council of
Courts, have started operating successfully, with the administrative support of the
National Court Administration. A new procedure for drawing up courts' budgets was
established to ensure the budgetary autonomy of the courts.
The procedure for appointing judges has been reformed, notably through amendments to
the Law on Courts in January 2003, which established a Selection Committee in order to
increase the transparency and professionalism of the appointment process: judges are
appointed by the President of the Republic on the advice of the Council of Courts.
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Judicial positions have been made more attractive, particularly in terms of salary. The
number of vacancies in courts is therefore further decreasing: in May 2003, there were
about 50 judicial vacancies out of 718 positions. However, some judges are still
relatively young and inexperienced.
Much of the working capacity of judges is still absorbed by administrative work.
Therefore, in October 2002, the Council of Courts adopted a Resolution whereby an
assistant will be appointed for every judge. While the Supreme Court, the Court of
Appeals and the Supreme Administrative Court have a sufficient number of court
assistants, the number of assistants in district and county courts is very low. Adequate
funds should be allocated for the recruitment of more court assistants.
Concerning the quality of proceedings, respect of procedural rights and professional
ethics, some district court judges are reported to still have the tendency to blur their
function with those of the public prosecutor. The situation regarding access to legal aid,
particularly in civil and administrative cases, is still unsatisfactory, due to the complexity
of the procedure. The new Law on Bailiffs, which entered into force in January 2003, is
expected to significantly improve the effective enforcement of judgements.
In March 2003, the Seimas amended the Constitution in order to strengthen the
independence of the public prosecutors. Accordingly, in April 2003, it also amended the
Law on Public Prosecution, clarifying the status and the functions of the public
prosecutor, who will be the head of the pre-trial investigation and responsible for the
supervision of the investigators. The procedures for the recruitment of public prosecutors
are satisfactory. However, prosecutors are frequently appointed as judges and therefore
tend to stay in public prosecution for a rather short time.
The Training Methodology Division of the Prosecutor General’s Office, which is
responsible for organising training for public prosecutors, has organised courses -
sometimes in co-operation with judges - on the new codes as well as on the acquis.
However, training needs to be strengthened especially as the new criminal code and
criminal procedure code particularly impact on the public prosecution. Prosecutors in
particular need to be supported to perform their important new role as the head of pre-
trial investigation. Another issue is the lack of computer equipment for the prosecution.
Working conditions are expected to improve, especially further to the government
decision to create 107 prosecutor’s assistants posts, but results have yet to be delivered.
Anti-corruption measures
As acknowledged by the Lithuanian authorities, corruption remains a source of concern,
in particular in the customs, public procurement, traffic police and health sectors as well
as in the judiciary. Particular attention should therefore be paid to the tackle corruption
problems in a systematic and effective way and to ensure adequate prevention.
Overall, the anti-corruption policy, including the legal framework and institutional set-
up, is well on track and administrative capacity in the anti-corruption field is being
strengthened. The Special Investigation Service (SIS) is actively supervising and
monitoring the implementation of the national anti-corruption programme. In this
context, the line ministries have approved the sectoral anti-corruption strategies and
action plans. However, further efforts are needed to speed up implementation of the
national and sectoral programmes, with a focus on the municipal level, and to ensure
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sufficient financial resources. A Code of Ethics for the Lithuanian Customs Officials was
adopted in October 2002
.
L
aw enforcement institutions (in particular customs, the
Special Investigations Service and the Financial Crime Investigation Service) have
signed inter-agency agreements in order to create effective mechanisms for co-operation
and exchange of information in detecting and investigating corruption-related offences.
However, further efforts have to be made in order to establish a proper and efficient
network for effective exchange of information.
The Seimas and government are expected to adopt, respectively, the Code of Conduct for
Politicians and the Code of Conduct for Civil Servants in the second half of 2003.
The administrative capacity of the SIS has been further strengthened, including in terms
of training. However, more systematic joint training sessions with prosecutors and judges
could be organised in order to facilitate their co-operation.
The SIS has continued to uncover corruption-related crimes, notably fraud, abuse of
office and forgery of official documents in relation to land restitution and land
acquisition. In October 2002, the SIS initiated an anti-corruption awareness campaign.
Increased efforts need to be devoted to the development of anti-corruption control, based
on risk assessment. Moreover, further awareness activities with the involvement of civil
society and adequate financial resources would contribute to prevention and education.
Lithuania has ratified the Council of Europe conventions relating to the fight against
corruption, and participates in the Baltic Anti-Corruption Initiative (BACI), which is
supported by the OECD Secretariat.
As a member of the Council of Europe's Group of States Against Corruption (GRECO),
Lithuania received a GRECO evaluation mission in October 2001. The mission report,
which was adopted in March 2002, formulated a number of recommendations aiming, in
particular, at improving overall co-ordination of anti-corruption policies and
strengthening preventive measures. These recommendations are being addressed by
Lithuania notably through the National Anti-Corruption Programme and sectoral
strategies and actions plans. GRECO invited Lithuania to present a report on the
implementation of the recommendations before the end of 2003.
Translation of the
acquis
into Lithuanian
In accordance with Articles 2 and 58 of the Act of Accession, all acts adopted by the
Union’s institutions and the European Central Bank prior to accession become applicable
to the new Member States and are to be published in the Official Journal of the European
Union in the new official languages. While the EU institutions take responsibility for the
final revision of the translations and of their publication, it falls to the acceding states to
produce the translations and to ensure a thorough legal and linguistic revision.
The Lithuanian authorities were warned by the Commission in May that they were
lagging behind as far as the number of acts provided for finalisation was concerned.
Unfortunately, the situation has not since improved sufficiently to be declared safe. The
small number of staff employed by the Lithuanian Translation Coordination Unit, and
especially the lack of any legal revision until recently, have resulted in a considerable
backlog of unrevised texts. Insufficient coordination between the Translation
Coordination Unit and the respective ministries has also hampered the translation and
revision process. The process of finalising the texts in the EU institutions cannot proceed
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on a regular basis, and as a result the number of finalised acts has not reached a
satisfactory level yet. The Lithuanian Translation Coordination Unit is aware of the risk
of missing the deadline for the production of the Special Edition of the Official Journal in
Lithuanian and is increasing the workflow by recruiting a large number of new staff,
including legal revisers. An energetic push in revision work will be required for
Lithuania to catch up.
The number of revised texts coming from Lithuania must increase greatly in the coming
weeks, otherwise the publication of the Special Edition of the Official Journal in
Lithuanian may not be completed in time for accession.
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2.
The chapters of the acquis
As indicated, the following review of Lithuania’s ability to assume the obligations of
membership has been structured in accordance with the list of 29 acquis chapters.
Accordingly, this section opens with an assessment of the acquis relating to the
cornerstones of the internal market which are known as the “four freedoms”, and
continues with a systematic review of each of the chapters, covering all aspects of the
acquis,
including sectoral policies, economic and fiscal affairs, regional policy,
environment, justice and home affairs, external policies, and financial questions.
Chapter 1: Free movement of goods
The principle of the free movement of goods implies that products must be traded freely
from one part of the Union to another. In a number of sectors, this general principle is
supplemented with a harmonised regulatory framework, following the “old approach”
(imposing precise product specifications) or the “new approach” (imposing general
product requirements). The transposition of harmonised European product legislation
represents the vast majority of the content of this chapter. In addition, efficient
administrative capacity to apply horizontal and procedural measures in areas such as
standardisation, certification and market surveillance is essential. This chapter also
covers detailed EC rules on public procurement, requiring specialised implementing
bodies.
The
horizontal and procedural measures
necessary for the administration of the
Community product
acquis
in the new approach sector are in place. The transposition of
the horizontal framework has been completed. The implementation structures for
metrology, accreditation, conformity assessment and market surveillance are all in place
but need to be strengthened both in terms of training and equipment. The establishment
of the Lithuanian Standards Association, which is foreseen for 2004, is under
preparation. The Lithuanian Standard Board was accepted as a full member of CEN and
CENELEC in May 2003 and the Lithuanian Accreditation Bureau is a signatory to
multilateral agreements of the organisation European Accreditation.
Lithuania has transposed all the
acquis
of the
sectoral legislation
under the
new
approach
and in general the legislative transposition has been found to be in line with
the
acquis.
Transposition of the rules on pressure equipment, medical devices for
veterinary use and recreational crafts has been completed ahead of the target date for
transposition. The infrastructure regarding their implementation is at a reasonable level.
The Ministry of Economy, responsible for the implementation of most of the new
approach legislation, should be further strengthened in order to ensure better co-
operation between market surveillance bodies. Testing capacities should be reinforced.
The transposition of the
old approach
directives is progressing without specific
problems and it is expected to be completed at the latest by the date of accession even
though certain delays have occurred. Transposition of the
acquis
on legal metrology, pre-
packaging and chemicals (except for the
acquis
on explosive for civilian use) is in
progress and close to completion. Transposition is not yet completed in the field of
cosmetics although pre-marketing authorisations were duly abolished. Implementing
legislation on motor vehicles (type approval for motor vehicles, two or three-wheeled
motor vehicles and agricultural/forestry vehicles) remains to be adopted.
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Lithuania has taken the necessary steps to ensure the creation, reinforcement and
operational capacity of the institutions required to manage the
acquis
in nearly all the
sectors covered by the old approach directives. However, close attention should be paid
to complaints of corruption or administrative malpractice.
As regards foodstuffs, considerable progress has been achieved in the adoption of
legislation. Lithuania now needs to make additional efforts to transpose, in good time,
the
acquis
adopted from 2001 onwards. Progress has been made with regard to the
removal of incompatible pre-marketing authorisations of foodstuffs. Some amendments
are still expected to complete alignment.
Further attention is required as regards strengthening inter-institutional co-operation in
the field of food safety. This includes such issues as the need to provide sufficient
funding for staff, sampling and analysis (implementation of new analytical methods), to
develop and perform adequate sampling programmes for contaminants and to ensure that
the laboratories meet all the requirements. Lithuania also needs to implement Hazard
Analysis Critical Control Points (HACCP) principles, notably by reinforcing training of
audit inspectors, and to ensure appropriate control of genetically modified and novel
food. Preparations for participation in the Rapid Alert System for Foodstuffs and Feed
are on track. Aspects of food safety are also covered under
Chapter 7- Agriculture.
Transposition of pharmaceuticals legislation has been completed with the exception of
the
acquis
on good manufacturing practice. Further improvement is needed in the area of
inspection, post-marketing control, pharmacovigilance and supervision of advertising of
medicinal products. In the course of the accession negotiations, Lithuania has been
granted a transitional period relating to the renewal of marketing authorisations for
pharmaceutical products until the end of 2006.
In the field of
public procurement,
the new Law on Public Procurement and its
implementing legislation, which entered into force in March 2003, further aligned
Lithuanian legislation with the
acquis.
Some minor amendments are required as regards
in particular some definitions relating to coverage. The Public Procurement Office has
been established and is operational but its operational tools (handbooks, practical
guidelines) as well as relevant training of its staff should be further developed.
In the
non-harmonised area,
Lithuania has identified a list of barriers possibly in
contradiction with the principle of free movement of goods; this list needs to be updated
and the identified barriers must be removed, particularly as regards import or export
licences of oil products, alcohol products, tobacco and tobacco products. Lithuania has
undertaken satisfactory measures in view of introducing a mutual recognition clause
covering existing legislation. The national act transposing the
acquis
on control of the
acquisition and possession of weapons entered into force in July 2003 but
implementation remains to be completed. The acquis on cultural goods is transposed to a
large extent but remains to be completed. Legislation was adopted on the control of
product safety at external borders. Furthermore, preparations to enforce the regulation
have started and an agreement between customs and market surveillance bodies was
signed in December 2002. Nevertheless, efforts need to be stepped up.
Conclusion
Lithuania has met its commitments arising from the negotiations as regards the
horizontal and procedural measures
necessary for the management of Community
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legislation. Lithuania has essentially met its commitments in the fields of
sectoral
legislation
under the
new approach, public procurement,
and the
non-harmonised
area.
Minor amendments are still needed to the legislation on public procurement and
the operational tools of the Public Procurement Office should be further reinforced.
Lithuania is expected to be in a position to adopt and implement the remaining
acquis
from accession. In the non-harmonised area, incompatible import and export licences and
other identified barriers to trade need to be abolished.
Lithuania is partially meeting the requirements in respect of the
old approach sectoral
legislation.
Transposition of the foodstuff acquis must be completed and further efforts
are required for its implementation. Lithuania needs to give priority to completing
alignment also with the old approach directives covering industrial products. As far as
administrative capacity is concerned, Lithuania should strengthen its market surveillance
and certification structures.
Chapter 2: Free movement of persons
The acquis under this chapter provides for non-discriminatory treatment of workers who
are legally employed in a country other than their country of origin. This includes the
possibility of cumulating or transferring social security rights, which requires
administrative cooperation between Member States. In order to facilitate the practice of
certain professions, the acquis under free movement of persons also includes specific
rules concerning mutual recognition of qualifications and diplomas; for certain
professions a harmonised training curriculum must be followed to be able to use the
professional title. Furthermore, this area also covers the residence and voting rights of
EU citizens in any Member State.
In the field of
mutual recognition of professional qualifications,
Lithuania’s
legislation is not yet in line with the
acquis.
In particular, legislation on the general
system of recognition remains to be adopted. Furthermore, legislation on lawyers and to
a certain extent on commercial agents shows substantial shortcomings. As regards the
professions with specific directives on co-ordination of training (doctors, dentists,
general care nurses, midwives, veterinarians, pharmacists and architects), the
requirements on co-ordination of training have in general been implemented. Lithuania
has adopted several Government Orders aiming at transposing the acquis on recognition
of qualifications in the healthcare sector. Implementation of the relevant sectoral
legislation on the recognition of qualifications needs to be ensured. The necessary
administrative structures for implementation are in place but need to be strengthened, in
particular through training targeted on the precise tasks which will need to be performed
as from accession.
In the area of
citizens’ rights
legislative alignment has been largely completed, except
on the introduction of a legal status for foreigners, amendments to the procedure for
employment of foreigners and legislation on the right to participate in the European
Parliament elections. The main administrative structures for implementation are in place.
As for
free movement of workers
a transitional arrangement has been agreed. For the
first two years following accession, current Member States will apply national measures,
or bilateral agreements, to regulate the access of workers from Lithuania to their labour
markets. These arrangements may continue up to a maximum of seven years. Lithuania’s
legislation in the area of free movement of workers is almost fully in line with the
acquis.
Alignment is to be completed with the adoption of the Law on Trade Unions.
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With regard to
co-ordination of social security systems
no transposition into national
legislation is needed to achieve alignment with the
acquis,
but appropriate administrative
capacity needs to be ensured. Bilateral agreements with a number of Member States,
which rely on the same principles as the EU rules in this area, reflect that Lithuania’s
administration is acquainted with the administrative procedures.
Conclusion
Lithuania is essentially meeting the commitments and requirements in the area of
citizens’ rights, free movement of workers
and
co-ordination of social security
systems.
Some adjustments need to be made as soon as possible to the legislation on
foreigners to allow EU citizens to stay and work freely in Lithuania, and to participate in
the European Parliament elections of June 2004. Subject to the above adjustments,
Lithuania is expected to be in a position to implement the acquis in this area from
accession. The on-going measures to ensure adequate administrative capacity in these
areas should continue.
Lithuania is partially meeting the requirements for membership in the area of
mutual
recognition of professional qualifications.
Enhanced efforts should be made to
complete the alignment in these sectors. The administrative capacity to implement the
acquis in this area needs also to be reinforced.
Although progress was made with the recent adoption of legislation concerning mutual
recognition of qualifications in the health care sector, the absence of complete
transposition of the requirements relating to legislation on the general system of
recognition, and on mutual recognition relating to lawyers, dentists, veterinary surgeons,
pharmacists and architects gives rise to serious concern. Unless immediate action is
taken, Lithuania will not meet the requirements for membership in this area by accession.
Chapter 3: Freedom to provide services
Under this chapter, Member States must ensure that the right of establishment and the
freedom to provide services anywhere in the EU is not hampered by national legislation.
In some sectors, the
acquis
prescribes harmonised rules which must be respected if the
internal market is to function; this concerns mainly the financial sector (banking,
insurance, investment services and securities markets) but also some specific professions
(craftsmen, traders, farmers, commercial agents). Harmonised rules concerning personal
data protection and certain information society services must also be respected.
In the field of
the right of establishment and the freedom to provide financial
services,
Lithuania is essentially meeting its commitment as regards the elimination of
remaining legal and administrative restrictions. One potential barrier has been identified
so far concerning registration of foreign companies. However, the screening process
needs to be finalised as regards other legislative or administrative restrictions which are
not compatible with the principle of free provision of services in the light of the relevant
case law of the European Court of Justice, and the identified restrictions will need to be
removed upon accession in order to ensure the free provision of services. Furthermore,
alignment with the
acquis
on commercial agents needs to be completed.
In the field of financial services, legislative alignment has been largely completed in the
banking sector
since July 2003, but the directive on e-money has yet to be fully
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transposed. Lithuania should be in a position to implement the relevant
acquis
from the
date of accession.
The central bank essentially has the required infrastructure and human resources to deal
with the
acquis-related
tasks as a supervisory authority in the field of banking. However,
closer co-operation among banking, insurance and securities supervisors is required.
As regards the
insurance sector,
Lithuania has partially transposed the acquis and needs
to complete alignment in the fields of motor insurance (4
th
motor insurance directive) and
the insurance group directive. The procedure for Lithuania becoming a signatory of the
‘green card’ Multilateral Guarantee Agreement, as foreseen in the 1st motor vehicle
directive, still needs to be finalised and efforts should be made to cope with the
responsibilities linked to this status. The administrative capacity of the State Insurance
Supervisory Authority needs to be further strengthened and the qualifications and
staffing levels in the Deposit Insurance Fund remain to be improved.
In the field of
investment services and securities markets,
legislation is partially in line
except for the recent directives on undertakings for collective investment in transferable
securities: the Law on Collective Investments Undertakings transposing the directives
was adopted by the Parliament in July 2003 but is not yet in force. Further legislative
changes to transpose other legislation in this area are needed; the investment services and
insider dealing directive have been transposed, but more needs to be done before
Lithuania can be perceived as fully compliant with EU securities
acquis.
The Lithuanian
Securities Commission functions well but its powers as well as its independence need to
be reinforced.
Lithuania has been granted transitional periods to reach the minimum level of coverage
of deposit guarantee schemes as well as investor compensation schemes by the end of
2007.
Concerning the
protection of personal data and the free movement of such data,
the
new version of the Law on Personal Data Protection, adopted in January 2003, further
aligns Lithuanian legislation with the
acquis,
but some fine-tuning is still required. The
Data Protection Development Programme should be effectively adopted. Priority should
be given to the strengthening of the independence of the Data Protection Inspectorate,
notably by recruiting additional staff.
As regards
information-society services,
Lithuania has reached a high level of
alignment. Some fine-tuning is needed in the field of e-commerce, since the relevant law
omits certain key provisions. The administrative capacity is in place.
Conclusion
Lithuania is essentially meeting the requirements for membership in the
banking sector,
regarding the
right of establishment and the freedom to provide non-financial
services
and as regards the
protection of personal data
and
information-society
services,
and is expected to be in a position to implement this
acquis
from the time of
accession. Preparations in these areas should continue. The independence of the Data
Protection Inspectorate requires strengthening.
Lithuania is meeting the majority of the commitments and requirements arising from
membership in the
insurance sector
and
investment services and securities markets.
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In order to complete preparations for accession, a number of major directives still need to
be transposed in these areas. Overall administrative capacity should be strengthened.
Chapter 4: Free movement of capital
Under this chapter, Member States must remove all restrictions in national law on the
movement of capital between themselves, but also with third countries (with some
exceptions) and adopt EU rules to guarantee the proper functioning of cross-border
payments and transfers of all forms of capital. The acquis under this chapter also includes
harmonised rules on payments systems and the fight against money laundering, requiring
adequate enforcement capacity.
In the area of
capital movements and payments,
Lithuania is to a large extent in line
with the acquis. The restrictions concerning the calculation of the capital adequacy of
financial brokers were abolished in June 2003. Restrictions on investment in the lottery
sector were abolished through the adoption of the Law on Lotteries and amendments to
the Law on Investments. The restrictions on the conclusion of insurance contracts in
Lithuania by foreign insurance companies and restrictions on investment in banking
(acquisition of 10% or more of a bank’s share capital) have not been removed. Likewise,
the restriction related to nationality and residency requirements for the council members
of the insurance undertaking which manages the Deposit Insurance Fund and the Fund of
Insurance of Liabilities needs to be abolished. The remaining special rights for the state
in privatised companies have been abolished. Finally, Lithuania needs to ensure that its
privatisation legislation is in line with the acquis.
In accordance with the transitional arrangement it has been granted, Lithuania will
remove restrictions on the acquisition of agricultural land and forests by EU nationals
and by EU companies by May 2011 at the latest. In agreement with the Constitutional
Law of 2003, restrictions on real estate, not covered by the transitional arrangement, will
not apply as from accession.
The acquis on
payment systems
is largely in place. A new interbank payment and
settlement system, including a real time gross settlement (RTGS) system, remains to be
introduced. Lithuania needs to introduce adequate and effective redress procedures and
the relevant administrative structures for the settlement of disputes between banks and
customers.
In the area of
money laundering,
legislation needs to be completed in line with the most
recent acquis. Moreover, Lithuania needs to ensure full compliance with the
recommendations of the Financial Action Task Force. To effectively implement the
acquis, the Financial Intelligence Unit (FIU) needs considerable strengthening in terms
of staff and equipment, in particular the IT system. Training is needed for the FIU,
economic police, prosecutors, customs officials and bank staff (see
also chapter 24 –
Justice and home affairs).
Conclusion
Lithuania is essentially meeting the requirements for membership and is expected to be
in a position to implement the acquis in the area of
capital movements and payments
from accession. A limited number of specific issues will still need to be addressed in this
area.
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Lithuania is partially meeting the commitments and requirements concerning
payment
systems
and
money laundering.
In order to complete preparations for membership in
the area of money laundering, Lithuania must enhance efforts to finalise legislative
alignment and further reinforce its administrative capacity to effectively implement the
acquis. As regards payment systems, Lithuania must introduce a RTGS system.
Chapter 5: Company law
Under this chapter, Member States must adopt and apply harmonised rules required for
the proper operation of companies in the internal market. They concern five legislative
fields: company law in the strict sense, accounting law, intellectual property rights,
industrial property rights, and the recognition and enforcement of judgements in civil and
commercial matters as well as of contractual obligations.
In the field of
company law
as such, legislation is largely in line although some
important discrepancies remain to be addressed as regards the Law on the Supplement to
the Law on Companies. Administrative capacity has improved and the Central Register
of Legal Entities has been established. It will start operating from 1 January 2004.
However, the action plan on the transfer of the registration functions, data, infrastructure
and materials from the existing enterprise register to the Central Register needs to be
finalised. Other institutions, especially municipalities, which are currently managing
their own register, need to transfer it to the central body.
With regard to
accounting,
Lithuania is meeting the majority of the commitments but the
national audit law remains to be further aligned with the
acquis
as regards in particular
the scope of audits and practical training (amendments are under preparation). The
amended Law on Audit on quality assurance for the statutory audit in the EU has been
adopted. Administrative capacity is adequate.
In the field of
protection of intellectual and industrial property rights (IPR),
legislation is close to full alignment. The new Law on Copyright and related Rights
adopted in March 2003 further aligned national legislation with the
acquis.
However,
Lithuania should adopt, upon accession, the principle of EC exhaustion of rights.
Implementation of the
acquis
in the field of copyright and neighbouring rights is far
advanced. The new law transposes the information society directive but secondary
legislation remains to be transposed. The new version of the design law entered into
force in March 2003. Implementing legislation on copyright remuneration for printing,
recording or broadcasting of artistic works was also adopted and will be in force from
2004.
The regulations on Community trademarks and Community design are already
implemented to a large extent but some additional procedural adjustments will be
necessary upon accession. Legislation on satellite broadcasting and cable retransmission
is close to full alignment. Lithuania still has to complete preparations for its accession to
the European Patent Organisation. Legislation is complete as far as the legal protection
of biotechnological inventions is concerned.
Special transitional rules will apply in relation to pharmaceutical product patents,
involving the non-applicability of Community exhaustion to certain exports from
Lithuania, as regards the granting of supplementary protection certificates for medicinal
and plant protection products, as well as in relation to the extension of registered or
pending Community trademarks to the territory of Lithuania.
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As regards enforcement of IPR, Lithuania has adopted civil, administrative and criminal
measures to fight copyright infringement. The new Criminal Code that entered into force
in May 2003 establishes criminal liability for the infringement of industrial property
owners’ rights. However, piracy is still a serious problem. Administrative structures are
in place but lack co-ordination. Co-operation between enforcement bodies (police and
local government) has been improved but should be reinforced with a view to coping
with the high level of pirated and counterfeited products. Means of verification, training
and resources for customs officials should also be strengthened. Court procedures are
generally too lengthy and cumbersome.
Legislation similar to the
Regulation replacing the Brussels Convention
on mutual
recognition and enforcement of foreign judgements in civil and commercial matters has
been adopted and the Regulation will be directly applicable upon accession. Membership
of the
Rome Convention
will only be possible upon accession. Lithuania should
designate the relevant courts or other authorities to ensure swift implementation of these
provisions
(see also Chapter 24 - Justice and home affairs).
Conclusion
Lithuania is essentially meeting the requirements for membership, and is expected to be
from accession in a position to implement the
acquis,
in the areas of
company law
and
accounting,
and the
Regulation replacing the Brussels Convention
and the
Rome
Convention.
The transposition of the company law and accounting
acquis
will need to
be completed.
The majority of commitments and requirements arising from the accession negotiations
in the field of the
protection of intellectual and industrial property rights
have been
met. Further legislative alignment is required in the field of information society,
Community trademarks, copyright and related rights. Although the legislation is mostly
in line, enhanced efforts must be made to strengthen enforcement of intellectual and
industrial property rights, especially to cope with the high level of pirated and
counterfeited goods. Co-ordination among enforcement bodies (mainly customs, police
and judiciary) needs further improving and further training of these enforcement bodies
is required. The efficient functioning of the judiciary should be given particular attention.
Chapter 6: Competition Policy
The competition
acquis
covers both anti-trust and state aid control policies. It includes
rules and procedures to fight anti-competitive behaviour by companies (restrictive
agreements between undertakings and abuse of dominant position), and to prevent
governments from granting state aid which distorts competition in the Internal Market.
Generally, the competition rules are directly applicable in the whole Union, and Member
States must fully co-operate with the Commission on the enforcement of these rules.
In the
anti-trust
sector, Lithuania is completing legislative alignment with EU rules.
Legislation containing the principles of Community anti-trust rules as regards restrictive
agreements, abuse of dominant position and merger control has been adopted. However,
Lithuania still needs to ensure that its legislation is not in contradiction with the more
recent Community block exemptions.
Lithuania has the necessary implementing structure in place. The Competition Council is
able to effectively enforce the law on competition but its internal rules concerning the co-
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ordination of work between competition authorities and the EC remains to be improved.
Special training for judges should be further developed.
The enforcement record is generally satisfactory. Priority should be given to cases that
most seriously distort competition. In addition, a more deterrent sanctioning policy
should be adopted and rules governing the imposition of fines on companies breaching
anti-trust laws remain to be improved.
In the field of
state aid,
the Lithuanian Law on State Aid contains the basic principles of
EC state aid control.
The necessary implementing structures are in place and function well but efforts to
strengthen the administrative capacity, both in terms of expertise and human resources,
should be continued. Business society and interest groups’ awareness has been further
improved.
Lithuania needs to continue to develop a track record of proper application and
enforcement of state aid legislation, notably in the area of rescue and restructuring aid.
Conclusion
Lithuania is essentially meeting the commitments and requirements arising from the
accession negotiations as regards
competition policy
and is expected to be in a position
to implement this
acquis
from accession. In completing preparations for membership,
Lithuania should adopt a more deterrent sanctioning policy and should further strengthen
its enforcement record. In addition, Lithuania must develop a track record of proper
application and enforcement of state aid legislation, notably in the field of rescue and
restructuring aid.
Chapter 7: Agriculture
The agriculture chapter covers a large number of binding rules, many of which are
directly applicable. The proper application of these rules and their effective enforcement
by an efficient public administration are essential for the functioning of the common
agricultural policy. This includes the setting up of management systems such as a Paying
Agency and the Integrated Administration and Control System, which are covered under
”horizontal issues” below, and also the capacity to implement rural development actions.
The acceding countries must be ready to be integrated into the common market
organisations for a range of agricultural products, including arable crops, fruits and
vegetables, and meat. Finally, this chapter covers detailed rules in the veterinary field,
which are essential for safeguarding animal health and food safety in the internal market,
as well as in the phytosanitary field, including issues such as seed quality, harmful
organisms and plant protection products.
Horizontal issues
A national
Paying Agency
should be established under the supervision of the Ministry of
Agriculture but no legal act has yet been adopted to this effect. Considerable work
remains to be done (such as conclusion of agreements with delegated bodies, written
procedures, staff recruitment and training, and development of IT systems) if Lithuania is
to have a functioning paying agency by the date of accession.
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With regard to the
Integrated Administration and Control System
(IACS), Lithuania
has made good progress so far, but much remains to be done if Lithuania is to have a
fully functioning system by accession. The necessary administrative structures have been
set up but further work must be carried out, in particular to ensure that proper IT systems
are put in place.
The National Paying Agency will be responsible for the administration of
trade
mechanisms.
The relevant control tasks will be under the responsibility of the customs
services and the State Food and Veterinary Service. Certain legislative measures remain
to be completed and the development of administrative procedures in most fields needs
to be accelerated. Inter-institutional co-operation needs to be further improved.
The responsibility of
quality policy
and
organic farming
rests with the Ministry of
Agriculture, which will need to be further strengthened in terms of staffing and training.
As regards organic farming, administrative structures are in place but need to be
strengthened.
Lithuania has met the commitments and requirements arising from the accession
negotiations in the area of the
Farm Accountancy Data Network
(FADN) and is
expected to have implemented the FADN by accession.
State aid
measures in the field of agriculture remain to be brought in line with the
acquis
by the time of accession.
As concerns direct payments to farmers, Lithuania has not yet decided whether or not to
apply the single area payment scheme (SAPS).
Common market organisations (CMOs)
The Market Regulation Agency will be responsible for intervention measures and the
National Paying Agency will be responsible for inspection and authorisation of payments
for
arable crops.
The establishment of the actual structures, including storage premises
and intervention centres, needs to be accelerated.
Legislation concerning
sugar
has been partly transposed. Further rules are necessary for
full harmonisation. The administrative structures for the management of the sugar CMO
have been clearly designated but capacity may need to be reinforced in order to ensure
proper management. A system of sugar quotas is already in place but needs to be fully
harmonised.
Implementing legislation as regards marketing standards for
fruit and vegetables
as well
as the establishment of producers organisations has been adopted.
In the area of
wine and alcohol,
the CMO for wine is in place.
standards for spirit drinks has been adopted. However, further
comply fully with the wine labelling
acquis
in particular for
institution controlling the use of geographical designation for
designated.
Legislation on quality
efforts are needed to
sparkling wines. The
spirits remains to be
A temporary
milk
quota system was introduced in 2003 and responsible institutions for
its management were defined. In order to ensure full compliance of the quota system
further legislation has to be adopted and enforced. The administrative structures of the
National Paying Agency, including its regional units, and of municipalities, which will
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be responsible for the quota system need to be substantially strengthened in order to
ensure proper milk quota management. Further efforts are also necessary with regard to
other parts of the CMO, such as the preparation of disposal measures.
Legislative measures have been adopted regarding carcass classification and price
reporting for
beefmeat, sheepmeat and pigmeat
as well as for beefmeat labelling. The
establishment of appropriate administrative structures is progressing but further
preparations are needed, in particular as regards classification controls and the price
reporting system. However, enhanced efforts need to be undertaken for beef.
For
eggs and poultry,
legislative measures remain to be put in place as regards
marketing standards, price reporting and the reporting of production statistics.
Rural development
The SAPARD Agency will be the paying agency for rural development and will be
responsible for implementation of the measures. The Agency already has substantial
experience with the implementation of SAPARD, which has made good progress with
the commitment of funds to beneficiaries. A draft Rural Development Plan for
expenditure under the Guarantee section of the European Agricultural Guidance and
Guarantee Fund (EAGGF) has been submitted to the Commission.
Legislation on forest fire prevention has been adopted along the lines of the
acquis
and
legal acts concerning protection of forests against fire are in place. Administrative
capacity for forest fire prevention is fully in place and operational.
Veterinary and phytosanitary issues
Transposition of legislation on transmissible spongiform encephalopathies (TSEs) and
animal by-products
has been partly achieved. Implementation, however, needs to be
accelerated. TSE surveillance needs to be upgraded, in particular testing of risk animals.
A collection system for cadavers is not yet in place and rendering plants remain to be
upgraded. A total feed ban has been implemented.
The establishment of the
veterinary control system in the internal market
is not
completed. Lithuania has not yet joined the computerised network linking veterinary
authorities, ANIMO. Regarding identification and registration of animals legislation
remains to be completed. A central computer database for bovine animals is operational
but needs upgrading in particular with regard to transmission of information. The law on
financing veterinary inspections and controls has been transposed but the level of fees
has to be adjusted. Transposition regarding veterinary checks of imports from third
countries and rules for imports has largely been completed. Further work is needed to
bring border inspection posts into compliance with EU requirements, in particular as
regards rail connections at the Kena and Pagegiai posts, and with regard to road access to
the Panemune post.
Regarding
animal disease control
measures, national contingency plans on foot and
mouth disease and classical swine fever have been provided, but remain to be prepared
for Newcastle disease and avian influenza. Lithuania has joined the Animal Disease
Notification System (ADNS) on a voluntary basis.
Steps have been taken to align the Lithuanian legislation on
trade in live animals and
animal products
with the
acquis.
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Legislation on
public health
protection has been transposed but needs to be adjusted.
The upgrading of establishments needs to be accelerated, in particular in meat and dairy
plants. Transitional arrangements have been granted for certain meat and milk
establishments until the end of 2006. Products from these establishments will be
restricted to the national market.
The
acquis
on
common measures
(including zoonoses) has been transposed but needs
adjustments. A programme for monitoring Salmonellosis is in place. The residue-
monitoring programme does not meet EU requirements.
The
acquis
in the field of
animal welfare
has been transposed but only partially
implemented. Action is needed to ensure that laying hen holdings comply with the EU
requirements. Administrative structures and capacity are in place but further training in
implementation of animal welfare knowledge and legislation is needed.
In the field of
zootechnics,
steps have been taken to align the Lithuanian legislation with
the
acquis.
The
acquis
for
animal nutrition
has been transposed but further work is required for the
practical implementation of the legislation. Further efforts will be needed in this field to
build up the capacity of the inspection and control bodies. In particular, co-operation and
agreement between these bodies in the implementation of feed legislation should be
further developed and enhanced.
In the field of
phytosanitary
legislation, the Law on Seed Cultivation to a large degree
transposes the
acquis
on quality of seeds and propagating material. However, in the area
of harmful organisms, legislation on protected zones, imports for scientific purposes and
plant passports remains to be adopted. Plant passports will not be adopted before
accession. Lithuania has been granted a transitional arrangement until 1 January 2006 for
potato ring rot and until the end of 2010 for remuneration for plant variety rights. The
acquis
for plant protection products has been transposed but amendments remain to be
adopted.
Lithuania has to ensure that international veterinary and phytosanitary agreements are
brought into compliance with the
acquis
by accession.
In order to ensure a comprehensive approach to enhancing food safety throughout the
food chain, the Food Safety Council was established under the joint authority of the
Ministry of Agriculture and the Ministry of Health. Aspects of food safety are also
covered under
Chapter 1 – Free movement of goods.
Conclusion
Lithuania is essentially meeting the commitments and requirements arising from the
accession negotiations, among the horizontal issues as regards
quality policy
and
organic farming,
the
Farm Accountancy Data Network
(FADN) and
state aid;
among
the common market organisations (CMOs) as regards
arable crops, sugar, fruit and
vegetables, wine, sheep and pigmeat
and
eggs and poultry;
and as regards
rural
development.
In the veterinary and phytosanitary field, the requirements in the areas of
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animal disease control measures, trade in live animals and animal products,
zootechnics and animal nutrition
are essentially met. Subject to good progress being
maintained in these areas, Lithuania should be in a position to implement this
acquis
from accession.
Lithuania is partially meeting the commitments and requirements for membership in the
areas of the
Paying Agency,
the
Integrated Administration and Control System
(IACS),
trade mechanisms,
the CMOs for
milk
and
beefmeat,
and in the veterinary
field as regards
TSEs and animal by-products, veterinary control systems in the
internal market, public health (particularly
as regards the upgrading of agri-food
establishments),
common measures, animal welfare
and in the
phytosanitary
field.
Unless efforts are accelerated in these areas, there is a risk that functioning systems will
not be in place at accession.
Chapter 8: Fisheries
The
acquis
on fisheries consists of regulations, which do not require transposition into
national legislation. However, it requires the introduction of measures to prepare the
administration and the operators for participation in the Common Fisheries Policy (in the
areas of market policy, resource and fleet management, inspection and control, structural
actions and state aid). In some cases, existing fisheries agreements or conventions with
third countries or international organisations need to be adapted.
In the field of
resource and fleet management, and inspection and control,
legislation
has been brought in line with the
acquis.
Alignment with regard to the Vessel Monitoring
System (VMS) has been completed. Lithuania has created the necessary institutions in
the field of fleet management resources, inspection and control of fishing activities. As
regards resource and fleet management, the operational capacity of these institutions still
needs to be reinforced. The Fishing Vessel Register is in place, but few vessels have been
registered and data is incomplete. Re-measurement of fishing vessels is reported to be
completed. Satellite monitoring of fishing is operational and the Fishing Vessels
Monitoring Centre (FMC) has been modernised. According to the latest figures, all
vessels operating in the Baltic are equipped with satellite tracking devices (VMS).
However, the system is at present not capable of generating the data needed for Lithuania
to fulfil its reporting obligations, and new software must be installed. Co-operation
between institutions has to be further strengthened. Further efforts need to be made as
regards staffing levels and training. As regards inspection and control, sustained efforts
are needed to reinforce the operational capacity of the institutions. The financial means
available for control and inspection are very limited. The staff available mainly for port
controls is not adequate for the number of landings carried out. The activities of the
Lithuanian high seas fishing fleet, which has been considerably increased following the
recent re-flagging from Cyprus, are not adequately controlled.
In the area of
structural actions,
Lithuania has submitted the draft Single Programming
Document (Development Plan) to the European Commission. The data on fishing vessels
with fishing licences, operating in the Baltic Sea (currently 71 fishing vessels) and high
seas (25 fishing vessels) for commercial purposes, are available. However, additional
staff needs to be allocated to the Fisheries Department of the Ministry of Agriculture for
the effective administration of the Financial Instrument for Fisheries Guidance (FIFG).
Regarding
market policy,
Lithuania has adopted legislation on Common Organisation of
the Market in Fishery products, including recognition of producers’ organisations, aimed
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at aligning with the
acquis
has been adopted. However, producers’ organisations have
not been established.
As regards
state aid
to the fisheries sector, Lithuania allocates aid to the fisheries sector
with the annual state support programme for agriculture. The aid measures must be
brought into conformity with the
acquis
by accession.
Concerning
international fisheries agreements,
a solution has been found between
Lithuania, Estonia, Latvia and Russia on the division of the North Atlantic Fisheries
Organisation (NAFO) of the block quotas. Lithuania has not yet withdrawn from the
International Baltic Sea Fisheries Commission (IBSFC) or NAFO.
Conclusion
Lithuania is essentially meeting the commitments and requirements arising from the
accession negotiations and is expected to be in a position to implement by accession the
acquis
in the areas of
state aid
and
international agreements.
Lithuania is partially meeting the commitments and requirements for membership in the
areas of
resource and fleet management and inspection and control, structural
actions
and
market policy.
In order to complete preparations for membership Lithuania,
the administrative capacity needs to be strengthened and the Fishing Vessel Register has
to become fully operational. In addition, Lithuania must raise the number of staff in
bodies administering the Financial Instrument for Fisheries Guidance (FIFG) and
transpose implementing legislation on marketing of fishery and aquaculture products.
Furthermore, the administrative structures need to be set up as regards producers
organisations.
There are serious concerns in the field of inspection and control, where special action is
required to strengthen the human resources available and to control the landings and the
activities of the high seas fishing vessels. Unless immediate action is taken, Lithuania
will not be able to implement this
acquis
by accession.
Chapter 9 Transport
EC transport legislation aims at improving the functioning of the Internal Market by
promoting efficient and environment- and user-friendly transport services. The transport
acquis
covers the sectors of road transport, railways, aviation, maritime transport and
inland waterways. Member States are required to adopt and implement legislation
concerning technical and safety standards as well as social standards. In order to further
develop the European Single Transport Market, EC legislation also includes rules on
market liberalisation. An important aspect of EC maritime policy is the establishment of
Union-wide maritime safety standards.
As far as the
trans-European transport networks
are concerned, the necessary
administrative capacity (in both qualitative and quantitative terms) needs to be reinforced
beyond its present level in order to prepare for the significant investments that will be
needed in transport infrastructure.
Within the land transport sector, the transposition of the
road transport
acquis
continues. The framework legislation has been transposed. Some implementing
legislation, especially in the technical field, remains to be adopted, notably for technical
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road side inspections and transportable pressure equipment. Two transition periods have
been granted to Lithuania in this area. The installation of tachographs for vehicles
produced before 1987 and operating exclusively on the domestic market is to be
accomplished by December 2005, and the introduction of the financial standing criterion
for domestic road transport operators needs to be completed by January 2007. The
necessary administrative structures in this area are in place, with the State Road
Transport Inspectorate performing key supervisory and control functions. However, as
regards the implementation of social rules, the level of checks has to be increased in
order to meet
acquis
requirements, and attention needs to be paid to the co-operation
with the Labour Inspectorate and the Police. Administrative capacity should be
strengthened in the Ministry of Transport, the Road Administration, the State Road
Transport Inspectorate and the Labour Inspectorate. Lithuania has agreed to a transitional
arrangement put forward by the EU concerning gradual reciprocal access to the cabotage
market in the road haulage sector (for a maximum duration of five years).
Transposition of the
rail transport
acquis
remains to be completed with regard to the
revised railway
acquis
of February 2001, in particular the provisions such as separation
of accounts between infrastructure manager and operator(s), charging, capacity allocation
and rail regulatory functions, as well as the interoperability directives. In the framework
of the ongoing reorganisation process, the capacity of the State Railway Inspectorate and
the other railway administrations needs to be further strengthened.
On
inland waterway transport,
legislative alignment is completed. Administrative
structures in this area are in place and satisfactory.
In the area of
air transport,
the relevant framework legislation has been transposed and
is essentially in line with the
acquis,
but some modifications are needed with regard to
licensing. Implementing legislation is still being adopted. Lithuania has been granted a
transitional arrangement on the use of Kaunas International Airport by noisy aircraft until
the end of December 2004. Administrative capacity needs some further strengthening.
Full membership of the Joint Aviation Authorities remains to be achieved, and efforts
will need to be made in order to become full member before accession as required by the
acquis
and irrespective of the setting up of the European Aviation Safety Agency
(EASA).
In the field of
maritime transport,
framework legislation is in place and in line with the
acquis.
However, the adoption of implementing legislation remains to be completed, in
particular in relation to the
acquis
adopted under the “Erika” packages, and with regard
to the latest amendments to the
acquis
on passenger ships, fishing vessels. The relevant
administrative structures in this area are in place, and the ship inspection system has been
set up. However, the Lithuania Maritime Safety Administration needs further
strengthening. Lithuania has increased systematic port state control inspections.
According to statistics for 2002 under the Paris Memorandum of Understanding, the
percentage of Lithuanian flag vessels detained following Port State control was 6.25%.
This compares with an average for EU-flagged vessels of 3.5% in 2002. The Lithuanian
flag has been moved from the black list to the grey list of the Paris MOU. In addition,
Lithuania adopted in January 2003 a complementary action plan in order to further
reduce the detention rate of Lithuanian flagged ships.
Conclusion
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Lithuania is essentially meeting the commitments and requirements arising from the
accession negotiations in the
transport sector,
and is expected to be in a position to
implement the
acquis
from the time of accession, provided that the current pace of
progress is maintained. In completing preparations for membership, Lithuania must
complete the transposition of the railway
acquis,
in particular as regards interoperability,
and strengthen administrative capacity. In the areas of road and maritime transport,
Lithuania needs to adopt implementing legislation and further reinforce its administrative
capacity. In the area of air transport, Lithuania needs to strengthen administrative
capacity and become a full member of the Joint Aviation Authorities before accession.
Chapter 10: Taxation
The acquis on taxation largely covers the area of indirect taxation, as concerns VAT
(value-added tax) and excise duties. It lays down definitions and principles of VAT.
Excise duties on mineral oils, tobacco products and alcoholic beverages are regulated at
EU level as concerns the structure of the duty, the level of minimum rates and the
holding and movement of excisable goods. As concerns direct taxation, the acquis covers
some aspects of corporate taxes and aims mainly at removing obstacles to cross-border
activities between enterprises. Finally, the Community legislation in the area of
administrative co-operation and mutual assistance provides tools to prevent intra-
Community tax evasion and tax avoidance on both direct and indirect taxation.
In the area of indirect taxation, transposition of the acquis on
VAT
is taking place
according to schedule. In order to complete alignment Lithuania should transpose the
intra-community VAT scheme and align the scope of the reduced VAT rates and
exemptions, except in the area where it has obtained a derogation (see below). Lithuania
also remains to address minor remaining discrepancies in the area of taxable transactions,
the place of supply and the special scheme for second-hand goods. In the accession
negotiations, Lithuania has obtained derogations to apply a VAT exemption and
registration threshold of € 28 962 for small and medium sized enterprises and VAT
exemption on international passenger transport.
The necessary administrative structures in this area are in place and actions to reform and
modernise the tax administration are ongoing. Further extensive efforts are required to
improve the tax collection capacity and enhance the efficiency of the Tax Directorate,
particularly as regards the improvement of control procedures and audit functions.
Training and human resource development is a priority, mainly in audit and tax
collection enforcement.
As concerns
excise duties,
further efforts are still required to reach the EU minimum
excise rates on some products in all excisable product categories, and to align a certain
limited number of exemptions on mineral oils. Lithuania also needs to address
discrepancies as concerns the definitions of some products in all excisable categories and
the duty structure for some mineral oils. Furthermore, Lithuania should extend the
domestic duty-suspension scheme for the harmonized excisable products to intra-
community movements. The gradual increase of excise duties on cigarettes is proceeding
according to schedule, in order to reach the minimum rate level on 31 December 2009, as
agreed in the accession negotiations. Lithuania has the required administrative structures
in this area, but it should continue the on-going efforts to strengthen control and audit
functions.
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In the area of
direct taxation,
Lithuania needs to transpose the directives on interests
and royalties and on taxation of savings income. In order to comply with the principles of
the Code of Conduct for Business Taxation, Lithuania should amend its legislation on
free economic zones by removing the additional benefits for non-residents and the
possibility for businesses to perform banking and insurance activities. Notwithstanding
the ongoing actions, the tax collection capacity and efficiency of the tax administration
require further strengthening in order to ensure proper implementation of the acquis.
On
administrative co-operation and mutual assistance,
legislative alignment remains
to be completed. A suitably staffed Central Liaison Office (CLO) was set up and will
also carry out the function of the Excise Liaison Office (ELO). Urgent attention must be
paid to the development of the VAT Information Exchange System (VIES), which
started recently. Lithuania should be in a position to meet the essential part of its
commitments by accession, provided that the current pace of progress is accelerated.
Further efforts are required as regards the setting up of the System for Exchange of
Excise Data (SEED).
Conclusion
Lithuania is essentially meeting the commitments and requirements arising from the
accession negotiations in the area of
VAT, excise duties
and
direct taxation
and is
expected to be in a position to implement this acquis from accession. Lithuania needs to
adopt legislation to complete alignment in the areas of VAT and excise duties, and to
continue efforts to modernise and strengthen its tax administration, in particular as
concerns tax collection, audit and control procedures in the area of VAT.
In the area of
administrative co-operation and mutual assistance,
Lithuania is only
partially meeting its commitments. Lithuania must urgently accelerate the preparations
for setting up the VIES and SEED systems in order to ensure basic interconnectivity by
the date of accession. Any further slippage in the project could imply the risk that
Lithuania might not be in a position to implement the acquis in this area upon accession.
Chapter 11: Economic and monetary union
EC legislation on Economic and Monetary Union (EMU) contains specific rules ensuring
the independence of central banks in Member States, prohibiting indirect financing of the
state by the central bank, and disallowing privileged access of the public sector to
financial institutions. These rules must be transposed into the national legislation, despite
the fact that Lithuania will not yet adopt the euro as a currency from accession. EMU
policy also includes the co-ordination of exchange rate and economic policies, adherence
to the stability and growth pact and the statutes of the European System of Central
Banks.
In the area of
prohibition of direct financing of the public sector
Lithuania has met the
commitments and requirements arising from the accession negotiations, and is in a
position to implement the relevant acquis as from accession.
In the area of
prohibition of privileged access of the public sector to financial
institutions,
Lithuania has met the commitments and requirements arising from the
accession negotiations, and is in a position to implement the relevant acquis from
accession, since legislation abolishing restrictions on investment rules for pension funds
has been adopted.
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In the field of
independence of the national central bank,
all legislation is in place and
in line with the acquis except for the adoption of a final specific amendment to the
Central Bank Law inter alia in order to safeguard against possible conflicts of interest
relating to the duties of Members of the Board. The necessary administrative structures
are in place and function adequately.
Conclusion
Lithuania has met the commitments and requirements arising from the accession
negotiations in the fields of
prohibition of direct financing of the public sector
and
prohibition of privileged access of the public sector to financial institutions.
Lithuania is essentially meeting the requirements arising from the negotiations in the area
of
independence of the national central bank
and is expected to be in a position to
implement the acquis from accession. Lithuania needs to adopt an amendment to its
Central Bank Law.
Chapter 12: Statistics
The
acquis
in the field of statistics requires adoption of basic principles such as
impartiality, reliability, transparency, confidentiality of individual data and dissemination
of official statistics. It also covers methodology, classifications and procedures for data
collection in various areas such as statistical infrastructure, macro-economic and price
statistics, business statistics, transport statistics, external trade statistics, demographic
and social statistics, agricultural statistics and regional statistics. The focal point of the
statistical system of a country is the National Statistical Institute, which acts as the
reference point for the methodology, production and dissemination of statistical
information.
Lithuania is essentially meeting the commitments and requirements arising from the
accession negotiations in the area of
statistics
and is expected to be in a position to
implement the
acquis
as from accession. However, Lithuania needs to improve the
quality and the timeliness of data in certain domains such as business statistics and to
improve the coverage of regional and macro-economic statistics. Lithuania also needs to
make further efforts as regards the production of data on income and living conditions
and the processing of data stemming from the recent agricultural census.
Chapter 13: Social policy and employment
The
acquis
in the social field includes minimum standards in fields such as labour law,
equal treatment of women and men in employment and social security, and health and
safety at work. Specific binding rules have also been developed in public health (on
tobacco control and surveillance and control of communicable diseases) and recently also
with respect to non-discrimination on grounds of racial or ethnic origin, religion or
belief, disability, age or sexual orientation. The European Social Fund (ESF) is the main
financial tool through which the EU supports the implementation of its Employment
Strategy and contributes to social inclusion efforts (implementation rules are covered
under Chapter 21, which deals with all structural instruments). The acceding countries
are expected to be able to participate in social dialogue at European level, and in the EU
policy processes in the areas of employment, social inclusion and social protection.
Lithuania is completing legal alignment in the field of
labour law,
but legal adjustments
are still necessary in the following areas: European Works Councils, posting of workers
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part-time and fixed time work. The transposition of the new
acquis
concerning
information and consultation of workers and involvement of workers in the European
Company is foreseen after accession. The independent guarantee fund for employees is
in place.
Lithuania has transposed most of the legislation in the field of
equal treatment of
women and men,
and in general, the legislative transposition is in line with the
acquis.
However, requirements on parental leave (minimum period of three months) and the
burden of proof remain to be complied with before accession. The pensionable age for
male and female civil servants will have to be equalised upon accession, when the
pension scheme constitutes pay within the meaning of the Treaty and EC case law.
Implementing structures are in place and are functioning well.
In the area of
health and safety at work,
legal alignment is almost completed. The
National Labour Inspectorate is in place, but further strengthening, in terms of staffing
and technical facilities (especially in the field of health issues), as well as introduction of
new inspection methodologies based on the risk assessment concept are needed. The use
of risk premiums for hazardous working conditions should be abolished and collective
preventive measures should be more emphasised within the risk assessment framework.
As regards
social dialogue,
the institutional and administrative framework is in place,
but the administrative capacity of both the social partners and the Government should be
strengthened. Bipartite social dialogue needs to be further promoted.
In the field of
public health,
the transposition of the tobacco legislation needs to be
finalised. Lithuania’s legislation with regard to communicable diseases prevention and
control is in line with EC requirements, although EU case definitions should also be
taken over. However, significant administrative, technical and capacity building efforts
are required in order to fully implement these requirements. The structural reform of the
public health system is being implemented. Attention should be paid to raising health
care expenditure and to improving the health status of the population. The incidence of
some communicable diseases also gives rise to concern. As for administrative capacity,
the National Center for Public Health Research was established in July 2003 in order to
co-ordinate State-sponsored research in Lithuania.
Concerning
employment policy,
progress has been achieved (overall reduction of
unemployment) but efforts are still needed to effectively implement the priorities
identified in the Joint Assessment of the Employment Priorities (JAP). Attention must be
paid to focusing on a more active and preventive strategy, to enhancing incentives for job
creation and people to take up jobs and mobility. The modernisation and strengthening of
the capacity of the public employment services need to be continued. Important efforts
are needed to improve policy co-ordination and ensure appropriate financial resources.
As regards the
European Social Fund (ESF),
the administrative framework is in place.
However, the capacity of the Ministry of Social Security and Labour should be
strengthened to effectively monitor, evaluate and financially manage the fund, through
expansion of its ESF Unit (currently four persons). The tasks of the other intermediate
body, the Ministry of Education and Science, have been clarified thanks to the
establishment of its own ESF unit. Its staff (currently three persons) should be reinforced.
Additional capacity building in the Ministry of Finance is also required to effectively
administer the financial side of ESF assistance. Co-operation between these bodies
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should also be improved. Preparations for participation in the transnational operations of
the EQUAL initiative need to be intensified.
The Commission and Lithuania are finalising the Joint memorandum on social inclusion
(JIM), which identifies key challenges and possible policy orientations for promoting
social inclusion.
On this basis, an integrated strategy and a National Action Plan on
social inclusion will have to be developed. Analytical work and social statistics systems
on poverty and social exclusion should continue to be developed in line with EU
commonly agreed indicators on social inclusion.
In the field of
social protection,
the strategic aims of the National Programme for Social
Integration of Persons with Disabilities should be pursued, in particular the goals of
facilitating social integration and equal opportunities. Furthermore, sustained efforts are
required to adopt and implement the social security reform and the pension reform.
Lithuania is preparing its full participation in the open method of co-operation on
pensions. The amendments to the Law on Pension System Reform were adopted in July
2003.
Concerning
anti-discrimination,
draft legislation is before the Parliament. The Equality
Body required by the
acquis
needs to be established.
Conclusion
Lithuania is essentially meeting the commitments and requirements arising from the
accession negotiations in the fields of
labour law, equal treatment of women and men,
health and safety at work, social dialogue, employment policy, social inclusion
and
social protection
and is expected to be in a position to implement this
acquis
from
accession. Certain specific aspects of the
acquis
in these fields still need to be adopted
and overall administrative capacity needs to be strengthened. Concerning health and
safety at work, further legal alignment will be necessary in order to ensure full
compliance with the
acquis.
As regards employment policy, the effective implementation
of the priorities identified in the Joint Assessment Paper is necessary to prepare for full
participation in the European Employment Strategy.
Lithuania is meeting the majority of the requirements for membership in the areas of
public health,
especially as regards the tobacco legislation,
European Social Fund
and
anti-discrimination.
In order to complete preparations for membership, Lithuania needs
to complete legislative transposition in the field of public health. Attention must be paid
to reaching the necessary capacity to be able to meet Community requirements in the
area of communicable diseases surveillance and control. With regard to European Social
Fund, including EQUAL, while considerable progress has been achieved during the last
few months, further efforts are urgently needed in order to strengthen the administrative
capacity for management, implementation, monitoring, audit and control at both national
and regional level. Furthermore, attention must be given to alignment with the anti-
discrimination
acquis.
Chapter 14: Energy
EU energy policy objectives include the improvement of competitiveness, security of
energy supplies and the protection of the environment. The energy
acquis
consists of
rules and policies, notably regarding competition and state aids (including in the coal
sector), the internal energy market (for example, opening up of the electricity and gas
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markets, promotion of renewable energy sources, crisis management and oil stock
security obligations), nuclear energy and energy efficiency. This chapter also covers
important aspects of the safety of nuclear installations.
Regarding
security of supply,
and in particular oil stocks, framework and implementing
legislation is in place in Lithuania. The administrative capacity required has been
established - the Lithuanian Oil Products Agency and a group within the Ministry of
Economy, but these need to further confirm themselves in their role. Building up of oil
stocks is essentially taking place in accordance with the transitional arrangement
Lithuania has been granted, namely to reach the 90 days of oil stocks required by the
acquis by the end of 2009.
In the field of
competitiveness and the internal energy market
(electricity and gas),
acquis
transposition is taking place according to schedule. Framework legislation, the
Law on Electricity and the Law on Gas, and implementing legislation are in place.
Market opening in the gas and electricity sectors takes place in line with the
commitments made in the negotiations. Presently 26% of the electricity market and 80%
of the gas market are open for competition. The regulatory body, the National Control
Commission for Prices and Energy, whose task is to oversee the gas and electricity
markets, is established and functions well, but needs to be further strengthened. Lithuania
should transpose the recently adopted electricity and gas directives in line with the
timetable foreseen by this acquis.
Lithuania completed transposition in the area of
energy efficiency and renewable
energy,
except for the newest acquis, which should be transposed according to the
timetables provided for in the directives. Administrative structures, the Energy Agency
being the main institution, are in place but need to be further strengthened. Lithuania is
implementing an updated national energy efficiency programme 2001-2005, covering
also renewable energy issues.
In the field of
nuclear energy and nuclear safety,
Lithuania meets the commitments
and requirements arising from the accession negotiations and is in a position to
implement the Euratom
acquis
as from the date of accession. During the accession
negotiations, Lithuania committed itself, at the EU’s request, to closing Unit 1 of the
Ignalina Nuclear Power Plant (NPP) before 2005 and Unit 2 by 2009. The EU, for its
part, committed itself to continuing, even beyond 2006, to support Lithuania’s
decommissioning efforts. In the accession negotiations, Lithuania furthermore committed
itself to providing additional information on measures taken to implement the
recommendations of the June 2001 Council Report on Nuclear Safety in the Context of
Enlargement. Lithuania provided such information in October 2001 and in March 2002.
In June and September 2003, Lithuania submitted additional information covering recent
progress made in various fields of nuclear safety, including
inter alia
its preparation for
the closure and decommissioning of the Ignalina NPP, safety improvements, the new law
on social guarantees, the diverse shut down system, the staffing situation and activities of
the nuclear regulatory authority VATESI and the radioactive waste management agency
RATA, and the radioactive waste management strategy. In view of the considerable tasks
posed by the decommissioning of the Ignalina NPP in the next decades, Lithuania should
continue to pay attention to further strengthening of the capacity of the nuclear
regulatory authority and, given that agency’s recent creation, the radioactive waste
management agency.
Conclusion
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Lithuania is essentially meeting the commitments and requirements arising from the
accession negotiations in the
energy
sector and is expected to be in a position to
implement the acquis from accession. Lithuania needs to continue to progressively build
up oil stocks in line with the schedule agreed during the negotiations. It also needs to
continue to further strengthen administrative capacity in the energy sector and its efforts
to respect the closure commitments for the Ignalina NPP.
Chapter 15: Industrial policy
EC industrial policy seeks to enhance industrial competitiveness and rates of
employment, whilst operating in markets open to international competition. Its aim is to
speed up adjustment to structural change, encouraging an environment favourable to
initiative and to the development of undertakings throughout the Community. EC
industrial policy mainly consists of policy principles and horizontal and sectoral
industrial policy communications.
Lithuania’s
industrial strategy
essentially complies with the concepts and principles of
EC industrial policy, i.e. it is market-based, stable and predictable. The industrial policy
guidelines should be further implemented. The necessary administrative structures in this
area are in place, but are still weak.
In the area of
privatisation and restructuring,
the implementation of the restructuring
policy in a manner that conforms with the competition and state aid
acquis
remains an
area for special attention so as to create efficient and competitive firms. The necessary
administrative structures in this area are in place, but strengthening has to be continued.
Conclusion
Lithuania is essentially meeting the commitments and requirements arising from the
accession negotiations in the
industrial policy
chapter and is expected to be able to
implement the
acquis
as of accession. Lithuania should continue to strengthen
administrative capacities.
Chapter 16: Small and Medium-sized Enterprises
SME policy aims to improve the formulation and co-ordination of enterprise policy
across the internal market with a view to supporting the development of SMEs. In doing
so, it seeks to improve the overall business environment in which SMEs operate. SME
policy consists largely of consultation fora and Community programmes, as well as of
communications, recommendations and exchanges of best practices.
Lithuania is essentially meeting the commitments and requirements arising from the
accession negotiations relating to
small and medium-sized enterprises.
Alignment with
the new Commission recommendation on the SME definition should be carried out.
Further efforts are required to strengthen the administrative capacities to implement
business support measures. The implementation of the European Charter for Small
Enterprises should be maintained.
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Chapter 17: Science and research
Due to its specificity, the
acquis
in the field of science and research does not require any
transposition in the national legal order. However, the necessary implementing capacity
needs to be created to allow for effective participation in activities under the Framework
Programmes in the field of research.
Lithuania has met the commitments and requirements arising from the accession
negotiations in the area of
science and research
and will be in a position to implement
the
acquis
as from accession.
Chapter 18: Education and training
Education, training and youth is primarily the competence of the Member States. The
Community's acquis consists of a directive on education of the children of migrant
workers, and of action programmes and recommendations. The necessary implementing
capacity needs to be in place to allow for effective participation in the Community
programmes related to this chapter (Leonardo da Vinci, Socrates and Youth).
Lithuania has met the commitments and requirements for membership in the area of
Community programmes,
and will be in a position to implement this
acquis
from
accession. The implementing capacity for Community programmes will need to be
enhanced to benefit from additional allocations for decentralised actions following
accession.
In the area of
education of children of migrant workers,
measures for the
implementation of the
acquis
have been taken, and amendments aimed at aligning with
the
acquis
have recently been adopted. However, due implementation of the
acquis
needs
to be ensured.
Conclusion
Lithuania is essentially meeting the commitments and requirements arising from the
accession negotiations in the area of
education and training
and is expected to be in a
position to implement this
acquis
from accession. Efforts to implement the
acquis
on
education of children of migrant workers should continue.
Chapter 19: Telecommunications and information technologies
The acquis in the field of telecommunications consists mainly of the 1998 regulatory
framework and a 2000 regulation, and is aimed at the elimination of obstacles to the
effective operation of the single market in telecommunications services and networks,
and the achievement of universally available modern services. A new regulatory
framework on electronic communications was adopted in 2002 and must be
implemented. As regards postal services, the objective is to implement the single market
by opening up the sector to competition in a gradual and controlled way, within a
regulatory framework which assures a universal service (1997 and 2002 acquis).
In the field of
telecommunications,
Lithuania’s legislation is in line with the acquis
adopted in the period 1998 to 2000. The 2002
acquis
remains to be transposed.
Implementing legislation has been adopted but remains to be implemented in the fixed
telephony sector. While competition in the market has begun, following market opening
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in January, approved fixed interconnection prices of the incumbent have yet to be
oriented towards cost on the basis of long-run average incremental cost methodology.
Local loop unbundling needs to be implemented. Moreover, fixed network modernisation
and price re-balancing should be continued. While the necessary administrative capacity
of the Communications Regulatory Authority (CRA) is in place, resources are too limited
and staff training in the telecommunication legal framework needs to be strengthened. In
particular, the CRA needs to give particular attention to the achievement of universal
service.
In the area of
postal services,
Lithuania’s legislative alignment remains to be completed.
The implementing legislation defining the main characteristics of postal network and
quality requirements, has been adopted, but further amendments are required to complete
the transposition of the postal acquis as regards reserved services and universal service.
The administrative capacity in this sector needs to be strengthened through further
staffing and training in order for Lithuania to be able to implement the acquis adequately.
The 2002 acquis remains to be fully transposed and implemented.
Conclusion
Lithuania is partially meeting commitments and requirements arising from the accession
negotiations in the
telecommunications
and
postal services
areas. Attention must be
given to the transposition and implementation of the acquis in the telecommunications
area,
inter alia
by setting reasonable terms for interconnection and by implementing the
principle of universal services. The effectiveness and independence of the regulator in
the telecommunications sector needs to be ensured. Further efforts must be made with
regard to completing the transposition of the
acquis
in the postal sector and to ensuring
its implementation. Lithuania must also ensure the correct application of the universal
service acquis.
Chapter 20: Culture and audio-visual policy
The culture and audio-visual policy chapter requires legislative alignment with the
Television without Frontiers directive and contains the community programmes Culture
2000, Media Plus and Media Training. Alignment with the Television without Frontiers
directive creates the conditions for the free movement of television broadcasts within the
Community. It implies basic common requirements concerning advertising; the
protection of minors and public order; and the promotion of European works.
Whilst legislation is largely in line with the
audio-visual policy
acquis,
transposition
remains to be completed through an amendment to the Code of Administrative Offences,
which is required to provide for adequate penalties for broadcasters infringing the law
and their licence obligations. Administrative capacity for implementation of the audio-
visual
acquis
should be further strengthened, notably by reinforcing the sanctioning and
enforcement powers of the Radio and Television Commission (RTC). The Radio and
Television Commission should also reinforce its effectiveness in guaranteeing adequate
implementation of the
acquis,
including satellite broadcast licensing.
Lithuania meets the requirements for participation in Community activities in the field of
culture.
Conclusion
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Lithuania has met the commitments and requirements arising from the accession
negotiations in the field of
culture.
Lithuania is essentially meeting the commitments
and requirements arising from the accession negotiations on
audio-visual policy
and is
expected to be in a position to implement the
acquis
by accession. The legislative
amendment to the Code of Administrative Offences to provide for adequate sanctioning
remains to be adopted. Administrative enforcement powers should be strengthened.
Chapter 21: Regional policy and co-ordination of structural
instruments
The
acquis
under this chapter consists mostly of regulations, which do not require
transposition into national legislation. They define the rules for drawing up, approving
and implementing Structural Funds programmes and Cohesion Fund actions. These
programmes are negotiated and agreed with the Commission, but implementation is the
responsibility of the Member States. It is essential that Member States respect
Community legislation in general, for example in the areas of public procurement,
competition and environment, when selecting and implementing projects, and have the
necessary institutional structures in place to ensure implementation in a sound and cost-
effective manner from the point of view of both management and financial control.
Lithuania has agreed with the Commission on a NUTS classification of its
territorial
organisation.
The essential feature of the
legislative framework,
i.e. the ability to ensure multi-annual
budget programming, is in place. The legislation provides as well some flexibility for the
Government or its designated institutions to shift funds between investment areas or
sectors.
The legislative framework for financial control and compliance with other Community
policies is monitored in other chapters. However, in order for Lithuania to make effective
use of its eligibility for structural funds from 1 January 2004, the relevant
acquis
in areas
such as public procurement, state aid and environmental protection will need to be fully
respected from that date.
The necessary
institutional structures
for the preparation and implementation of the
Structural and Cohesion Funds are all in place. However, the division of responsibilities
between the Managing Authority and the intermediate bodies, and between the
intermediate bodies and the implementing agencies, needs to be further clarified and
should be set out in the procedure manuals under preparation.
Lithuania has made considerable efforts to recruit and retain qualified staff. At present
there are 312 members of staff working directly with pre-accession assistance or
preparation for Structural Funds management or in units to be used for Structural Funds
administration (e.g. internal audit units). Capacity-building efforts are being made. A
detailed training plan has been developed.
Effective inter-ministerial co-ordination and setting-up of the delivery structure placed
under the responsibility of the Managing Authority as well as of the functions of the
Paying Authority require close attention.
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The bodies responsible for implementation of the specific financial control provisions,
including the 5% and 15% on-the-spot checks, have been designated. Training of internal
auditors in all bodies, and in particular in the State Control Office, needs to continue.
As regards
programming,
the Single Programming Document (SPD) was submitted in
March 2003. The programme complement preparations started in parallel to SPD
preparations, and the draft programming complement has been submitted. The ex-ante
evaluation was submitted at the end of March and its conclusions integrated into the
SPD.
A SPD working group was established to ensure application of the partnership principle.
It is divided into thematic sub-groups, with wide participation from central, regional and
local actors and from civil society. Information on the SPD process is given through
regional workshops and is widely available through an interactive website managed by
the Ministry of Finance.
A single management and monitoring information system for the Structural Funds is
under development and Lithuania plans to have the system operational by April 2004.
The implementation contract was signed only in July 2003. Given the key importance of
this system, the progress of implementation should be closely monitored.
Considerable and sustained efforts are needed to establish a pipeline of projects that are
ready to be implemented in technical and financial terms so that to enable Lithuania to
benefit fully from Community funds as soon as the programme starts.
As regards
financial management and control,
specific provisions are laid down in the
Law on Internal Control and Internal Audit, adopted in December 2002. These
provisions need to be translated into specific procedures for financial control, auditing
and certification of expenses, and correction of irregularities. The Structural Funds and
Cohesion Fund procedure manuals setting out the duties of the various actors and
detailing the procedures to be followed and the financial flows should be completed as
soon as possible. Training of concerned staff remains a matter of priority.
Additionality must be verified before approval of the Single Programming Document. A
study organised by Lithuania for the ex ante verification of additionality has been
completed.
Conclusion
Lithuania is essentially meeting the requirements for membership in relation to
territorial organisation,
the
legislative framework,
and
programming.
Provided its
further work programme is carried out as envisaged, Lithuania is expected to be in a
position to implement the
acquis
in these areas from the start of the programme.
Concerning the legislative framework Lithuania needs to make sure that final
beneficiaries will be in a position to effectively apply the rules and procedures resulting
from the new public procurement law. In addition, Lithuania needs to focus on
establishing an adequate pipeline of well-prepared projects and on setting up a
functioning computerised monitoring system.
The commitments and requirements in the field of
institutional structures
and
financial
management and control
are only partially met. As regards institutional structures,
Lithuania needs to finalise the design of the delivery system, clearly define the tasks of
the various actors and ensure that adequately qualified staff is recruited and retained.
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Continued attention must also be paid to ensure co-ordination among the various
concerned authorities. In the area of financial management and control, urgent attention
should be paid to finalising, as a matter of priority, the specific procedures for financial
control, auditing and certification of expenses, and correction of irregularities, and
ensuring the allocation of the required resources once responsibilities have been defined.
Chapter 22: Environment
Community environment policy aims to promote sustainable development and protect the
environment for present and future generations, and is based on the integration of
environmental protection into other Community policies, preventive action, the polluter
pays principle, fighting environmental damage at source, and shared responsibility. The
acquis
comprises over 200 legal acts covering horizontal legislation, water and air
pollution, management of waste and chemicals, biotechnology, nature protection,
industrial pollution and risk management, noise, and radiation protection. Ensuring
compliance with the
acquis
requires significant investments, but also brings significant
benefits for public health and reduces costly damage to forests, buildings, landscapes and
fisheries. A strong and well-equipped administration at national, regional and local level
is imperative for the application and enforcement of the environment
acquis.
Horizontal legislation
is in place and is in line with the
acquis,
except for the recent
acquis
on strategic environmental impact assessment, which needs to be transposed and
implemented by July 2004 in line with the Directive, and exemptions under
environmental impact assessment which need to be completed by accession. While the
relevant administrative capacities are in place and function adequately, the competent
authority for strategic environmental impact assessment needs to be designated.
In the
air quality
sector, legislation is in place and is in line with the
acquis.
Administrative capacities are in place and function adequately. Air quality plans and
programmes have been developed, but the identification of zones and agglomerations
where thresholds are exceeded needs to be re-evaluated by accession. Monitoring needs
to be enhanced by accession. As regards volatile organic compound emissions from the
storage and distribution of petrol, a transitional arrangement until 31 December 2007,
with intermediate targets, has been agreed for certain installations in Lithuania.
In the field of
waste management,
legislation is in place and is in line with the
acquis,
except for the recent
acquis
on end-of-life vehicles and PCB/PCT, which need to be
completed by accession. Administrative capacities are in place and function, but require
strengthening at regional and local levels. The preparation of waste management plans
and the setting-up of a supervision system for waste shipments need to be completed by
accession. Close attention needs to be paid to hazardous waste management. A permit
and deregistration system for end-of-life vehicles also needs to be set up by accession.
The establishment of collection systems and recovery and disposal facilities needs to
continue. As regards packaging waste, a transitional arrangement until 31 December
2006, with intermediate targets, has been agreed.
In the area of
water quality,
legislation is in place and is in line with the
acquis,
except
for the recent framework
acquis
on water, for which the process is well advanced and
needs to be completed by accession. Administrative capacities in this area are in place,
but require continuous attention, especially as regards drinking water. Drinking water
monitoring needs to be enhanced by accession. Programmes for dangerous substances
need to be finalised and adopted. Lithuania needs to continue taking steps to resolve the
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issue of non-compliance of drinking water, including excess fluoride levels. As regards
urban waste water, a transitional arrangement until 31 December 2009, with intermediate
targets, has been agreed.
In the field of
nature protection,
legislation is in place and is in line with the
acquis,
except for implementing legislation on habitats and birds. Further efforts are needed to
finalise the preparation of a list of proposed sites of Community interest and the
designation of special protection areas by accession, and to apply relevant protection
measures. Administrative capacity at local and regional levels needs to be further
strengthened. Close attention needs to be paid to ensuring proper consultation while
avoiding delays.
The legislation on
industrial pollution and risk management
is in place and is in line
with the
acquis,
except for the recent
acquis
on large combustion plants and national
emission ceilings, which needs to be transposed by accession. Permits for installations
subject to the rules on integrated pollution prevention and control (IPPC) need to
continue to be issued and complied with according to
acquis
deadlines (until October
2007). While administrative capacities are in place and function, the capacity to issue
integrated permits for IPPC installations needs to be increased. The transposition and
implementation of provisions on major accident hazards need to be completed by
accession. As regards air pollution from large combustion plants, transitional
arrangements until 31 December 2015, with intermediate targets, have been agreed for
certain installations in Lithuania.
The
acquis
on
chemicals and genetically modified organisms
has been transposed and
is in line with the
acquis,
except for biocides where Lithuania still has to adopt the rules
on monitoring. Administrative capacities are in place and function. An action plan for
strengthening the institutions has been developed. Implementing measures in the area
are proceeding as planned. Co-ordination between the organisations involved needs to
continue to be enhanced.
Transposition of the
acquis
on
noise
is proceeding according to schedule, and the
legislation is in line with the
acquis,
except for the recent
acquis
on ambient noise, which
needs to be completed by July 2004 in line with the Directive. Administrative capacities
are in place and function.
As regards
nuclear safety and radiation protection,
legislative alignment has been
completed and the legislation is in line with the
acquis.
Administrative capacities in this
area are in place and function adequately.
Conclusion
Lithuania is essentially meeting the commitments and requirements arising from the
accession negotiations and is expected to be in a position to implement the
acquis
in all
areas of
environment
policy by accession. Lithuania needs to finalise the legal
alignment as regards the following areas: horizontal legislation, waste management,
water quality, nature protection, industrial pollution and risk management, chemicals and
noise. It needs to complete air quality plans and programmes and continue to enhance air
quality and water quality monitoring. Moreover, Lithuania must pay particular attention
to implementation in the water sector, especially as regards drinking water quality, and
finalise the programmes for discharges of dangerous substances to water. In addition,
Lithuania must make further efforts to finalise its lists of proposed nature protection sites
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and special bird protection areas. In this context, close attention needs to be paid to
ensuring proper consultation while avoiding delays. As regards industrial pollution and
risk management, permits for IPPC installations need to be issued and complied with
according to the
acquis
deadlines, and the implementation of provisions on major
accident hazards must be completed. Attention must be paid to hazardous waste
management. Waste management plans, at regional and local levels, need to be
completed, and a supervision system for waste shipments set up. The establishment of
waste collection systems and recovery and disposal facilities needs to continue.
Administrative capacity still requires strengthening in some sectors, in particular at
regional and local levels in the areas of waste management, water quality and nature
protection. Also the capacity to issue integrated permits for IPPC installations needs to
be increased.
Chapter 23: Consumer and health protection
The
acquis
covers protection of the economic interests of consumers (concerning
misleading and comparative advertisements, price indication, consumer credit, unfair
contract terms, distance and doorstep selling, package travel, timeshare, injunctions for
the protection of consumers’ interests, and certain aspects of the sale of consumer goods
and associated guarantees) as well as the general safety of goods (liability for defective
products, dangerous imitations and general product safety). Recently adopted legislation
includes rules on general product safety and distance marketing of consumer financial
services. The acceding countries need to effectively enforce the
acquis
through
appropriate judicial and administrative systems, including market surveillance and a role
for consumer organisations.
With regard to
safety-related measures,
Lithuania has largely completed alignment.
However, transposition of the revised general product safety directive remains to be
achieved. The administrative structures are in place, but need to be strengthened in terms
of both financial and human resources.
Market surveillance
relating to general product
safety is only partly developed. Lithuania has created the relevant policy, management
structures and information system. Co-operation agreements have been signed between
the State Non-Food Products Inspectorate, the State Labour Inspectorate, customs and
the Financial Crime Investigation Services. However, co-operation between the different
market surveillance bodies should be further improved and openend to other bodies (e.g.
customs whose role in performing checks on the safety of products imported from third
countries should be greatly increased). The range of products controlled should be
widened. A market surveillance information system remains to be created.
As regards
non-safety related measures,
Lithuania is fairly advanced in legislative
alignment. However, amendments to the existing non safety-related measures are needed
in particular with respect to injunctions for the protection of consumers’ interests. The
relevant institutional and administrative framework is in place but human resources need
to be further enhanced. In particular, more efforts are needed to develop a national
database of the market for consumer goods and services. There is a need to further
develop and strengthen the administrative structures with regard to arbitration bodies,
which play an important role in solving consumer cases.
The role of
consumer organisations
remains to be further promoted. Consumer
associations should take an active part in the implementation of the foreseen National
Strategy for Consumer Protection and the National Consumer Education Programme.
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The activities of the Consumer Protection Commission, the consultative body to the
National Consumer Rights Protection Council, need to be promoted as well. There is also
a need for improvement with respect to the level of awareness of consumers’ and
businesses’ rights and responsibilities.
Conclusion
Lithuania is essentially meeting the commitments and requirements arising from the
accession negotiations in the areas of
safety-related
legislation and
consumer
organisations
and is expected to be in a position to implement this
acquis
as from
accession. Lithuania needs to complete the alignment with the
acquis
of the revised
general product safety directive.
Lithuania is meeting the majority of the requirements for membership in the area of
market surveillance
and
non-safety related measures.
In order to complete preparation
for membership Lithuania needs to complete alignment in the non-safety related area and
to improve market surveillance to ensure the proper enforcement of legislation on safety
and non-safety related areas including by strengthening the administrative capacity and
structures.
Chapter 24: Justice and home affairs
The most developed part of this chapter is the Schengen
acquis,
which entails the lifting
of internal border controls. However, much of this
acquis
will not apply to the acceding
countries upon accession, but only after a later separate Council Decision. The Schengen
Implementation Action Plan aims at preparing this on the basis of a credible schedule for
the introduction of the Schengen provisions. Binding rules which must be put in place as
from accession include part of the rules on visas, rules on external borders and the acquis
on migration, asylum, police co-operation, combating organised crime, fight against
terrorism, fraud and corruption and drugs, customs co-operation as well as human rights
legal instruments. On issues such as border control, illegal migration, drugs trafficking
and money laundering, organised crime, police and judicial co-operation, data protection
and the mutual recognition of court judgements, acceding countries need to be equipped
to meet adequate standards of administrative capacity. The establishment of an
independent, reliable and efficient judiciary and police organisation are also of
paramount importance.
Lithuania's preparation regarding Schengen provisions (Schengen
Action Plan)
relevant
to accession remains essentially satisfactory, but continued significant efforts will be
needed after accession to prepare for the lifting of internal borders and full
implementation of the Schengen
acquis
on the basis of a further decision to be taken by
the Council. Lithuania needs to complete alignment with Article 5 of the Schengen
Convention on the entry conditions for foreigners. The implementation of the separation
of traffic at air- and seaports requires continued attention. Although participation in SIS
II will not be possible upon accession, preparations for integration into the Schengen
Information System (SIS) II should continue. The establishment of a SIRENE bureau as
well as the development of the necessary information technology infrastructure and
national registers should continue as a matter of priority.
The legislation in the field of
data protection,
including the use of personal data by the
police, is in place. The independent State Data Protection Inspectorate remains the key
body in this acquis area; inter-agency co-operation needs continued attention.
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On
visa policy
Lithuania is continuing to align its legislation with the
acquis.
Lithuania
needs to align with the Common Consular Instructions and be in full conformity with the
so-called "positive" visa listswhere negotiations are still ongoing with 13 countries.
Lithuania should also ensure alignment regarding the uniform visa format following the
transmission of the relevant technical specifications by the EU in August 2003. As
regards implementation and administrative capacity, sustained efforts are needed in
relation to infrastructure, recruitment of staff, training, the installation of information
technology and the establishment of a national visa register. This visa register needs to
be connected, in a secure manner, to all diplomatic and consular posts.
As regards the management of the future
external borders,
Lithuania has in general
aligned its legislation on border control and border surveillance. The border agreements
with the Russian Federation have been ratified and thus remaining matters regarding
border demarcation can be addressed. Lithuania has largely demarcated its border with
Belarus. Co-operation with Poland and Latvia in managing the common border is further
improving. Implementation of the national strategies (the State Border Protection
Development Programme and its implementation plan, and the Strategy for
Development of Border Crossing Points) and the relevant parts of its Schengen Action
Plan are ongoing. However, continued staff training and the allocation of adequate
financial means to fully implement the Lithuanian plans remains necessary. Further
enhancing the ongoing inter-agency co-operation, which is based on co-operation
agreements, also requires efforts. Lithuania is in the process of upgrading its equipment
for surveillance both at the green and blue borders, while border posts at future external
borders are being reinforced. Continuous efforts are needed to ensure timely
implementation of Lithuanian plans, in particular regarding the surveillance of illegal
entry of small vessels from the Russian Federation (Kaliningrad).
In the area of
migration,
Lithuania is advanced as regards alignment with the acquis. It
needs to complete alignment by adopting an Administrative Code providing for carrier
liability. Lithuania must also adopt a new Law on the Legal Status of Foreigners in order
to align with the acquis on the right of family reunification, residence permits and access
to employment. Furthermore, Lithuania should transpose the recent
acquis
on the
uniform format for residence permits, and the mutual recognition of expulsion decisions.
Lithuania is taking action to conclude readmission agreements and has now concluded
such an agreement with the Russian Federation. However further efforts are required
with Belarus among others. Administrative structures (the Migration Department of the
Ministry of Interior, the State Labour Inspectorate etc) are essentially in place and
cooperation among the key institutions is satisfactory, but needs to be sustained.
In the field of
asylum,
further efforts are needed to complete alignment. Alignment with
the Dublin Regulation (asylum procedures) should be ensured through the entry into
force of the above-mentioned Law on the Legal Status of Foreigners. The same Law
should ensure full alignment concerning minimum guarantees for asylum procedures as
regards the suspensive effect of appeal during an admissibility procedure and concerning
the principle of "non-refoulement" in cases of alternative protection. Lithuania is
encouraged to further enhance cooperation between the institutions dealing with refugee
matters, to create within the Asylum division a sub-unit for Dublin Regulation matters, to
restructure its data base of asylum seekers in accordance with EURODAC rules and to
further improve the reception conditions for asylum seekers. Furthermore, considerable
preparations, including the signing of a Memorandum of Understanding, are still required
for the establishment of National Access Points for Dublinet and EURODAC.
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In the area of
police co-operation and combating organised crime,
legal alignment is
near to completion. The Protocol to the UN Convention against transnational organised
crime on the illicit manufacturing of and trafficking in firearms, their parts, components
and ammunition needs to be ratified. Despite good progress, efforts are still required, on
the basis of the Strategic Plan for the police, to ensure that Lithuania has an accountable,
reliable and fully co-ordinated police organisation by accession. Continuous attention is
needed for smooth co-operation and co-ordination between the police and the
prosecuting and judicial bodies. Sharing information on combating economic and
organised crime needs attention and sufficient financial means are necessary to
implement all the envisaged measures. International co-operation is increasingly well
established but the relevant co-operation agreements need to be completed (Poland,
Latvia). The signing of an agreement with Europol is still pending. Once concluded,
attention should be paid to the timely preparation of national procedures in order to
ensure the swift ratification of the Europol Convention upon accession to the EU. Inter-
agency co-operation needs to be further strengthened, police training needs to be
improved, the College of Internal Affairs established, and a criminal intelligence system
needs to be developed which can provide intelligence products for operational purposes.
In the
fight against terrorism,
Lithuania has aligned with most of the acquis and has
ratified the key Conventions in this area, in particular the 1999 UN Convention for the
Suppression of the Financing of Terrorism. Lithuania needs to accede to the Convention
on Mutual Assistance in Criminal Matters between the EU Member States upon
accession. Lithuania has also continued to develop its capacity to combat terrorism
through the implementation of the National Programme to Fight against Terrorism.
As regards the
fight against fraud and corruption,
Lithuania needs to complete
alignment with the acquis. Full alignment with the provisions of the 1995 Convention on
the protection of the European Communities’ Financial Interests and its Protocols, and
with the Council Framework Decisions on the protection of the euro against
counterfeiting, should be ensured. Lithuania has yet to designate a National Central
Office, dealing notably with banknote and coin analysis. The ratification of the 1997
Convention on the Fight Against Corruption involving Officials of the European
Communities or Officials of Member States of the EU is outstanding. Despite
encouraging progress and success regarding the uncovering of cases in various areas,
enhanced implementation of the National Anti-Corruption Programme and continued
strengthening of the involved institutions remains necessary. The recently operational
new Code of Criminal Procedure, which substantially changed the institutional
responsibilities for pre-trial investigation by establishing the prime competence of
prosecutors in these investigations, requires adaptation of all relevant institutions. As
regards
corruption,
see also
Section C.1. — Administrative and judicial capacity.
On the
fight against drugs,
Lithuania has largely completed its legislative measures. It is
implementing the National Drugs Control and Drug Prevention Strategy and is
developing a new strategy for 2004-2008. The institutional infrastructure and capacity of
the National Focal Point for the future co-operation with the European Monitoring
Centre for Drugs and Drug Addiction needs to be strengthened considerably. Inter-
agency co-operation and co-ordination also needs to be enhanced, including through the
strengthening of the Governmental Drug Control Commission.
Lithuania has still to amend its legislation on
money laundering
to allow for the seizure
and confiscation of criminal assets. A Financial Intelligence Unit (FIU) has been
established within the Financial Crime Investigation Service. It should be provided with
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the necessary staff and equipment in order to cope with the rising workload. In addition,
information technology systems should be further developed and training on money
laundering issues for the FIU, the police customs officials judges and public prosecutors
needs to be enhanced (see
also Chapter 4 – Free movement of capital).
In the area of
customs co-operation,
Lithuania is in the process of aligning its
legislation with the acquis. It needs to accede to the Convention on Mutual Assistance
and Co-operation between Customs Administrations (Naples II); and to the Convention
on the use of information technology for customs purposes. Inter-agency co-operation is
ongoing but needs to be further improved. Co-operation with businesses on the basis of
memoranda of understanding is provided for. The development of an integrated customs
information system and staff training is to be pursued.
In the area of
judicial co-operation in civil and criminal matters
legislative alignment,
where still necessary, is ongoing and Lithuania should be ready upon accession to apply
it and accede to the relevant conventions. Particular attention should be paid to
alignment with the Council Framework Decision of 13 June 2002 on the European arrest
warrant and the surrender procedure between Member States. Administrative structures
for direct contacts between competent judicial authorities are in place and need to be
further strengthened.
As regards the
reform of the judiciary
in general, an analysis is provided in
Section C.1.
— Administrative and judicial capacity.
The
human rights legal instruments
under the justice and home affairs
acquis
have
been ratified by Lithuania.
Conclusion
Lithuania is essentially meeting the commitments and requirements arising from the
accession negotiations in the area of Justice and Home Affairs and is expected to be in a
position to implement from accession the acquis in the areas of the
Schengen Action
Plan, data protection, visa policy, external borders,
the
fight against terrorism
and
drugs, customs co-operation, judicial co-operation in civil and criminal matters
and
human rights legal instruments.
Lithuania should take care, regarding external borders,
to make good progress in ensuring sufficient and adequate staff and equipment. Lithuania
should also ensure the necessary budgetary means to comply with its commitments,
including
as regards the Schengen Action Plan.
Lithuania is partially meeting the commitments and requirements for membership in
relation to
migration, asylum, police co-operation
and
combating organised crime,
the
fight against fraud and corruption
and
money laundering.
Overall, Lithuania
needs to adopt and implement the necessary remaining legislation. The actual
implementation of policies, including the anti-corruption strategy, needs to be pursued.
Particular attention must be given to the technical and organisational preparations
necessary to fully implement EURODAC and Dublin II. Institutions, inter-agency co-
operation and co-ordination structures need further strengthening.
Chapter 25: Customs union
The Customs Union acquis consists almost exclusively of legislation which is directly
binding on the Member States and does not require transposition into national law. It
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includes the Community’s Customs Code and its implementing provisions; the
Combined Nomenclature, Common Customs Tariff and provisions on tariff
classification, customs duty reliefs, duty suspensions and certain tariff quotas; and other
provisions such as those on customs control of counterfeit and pirated goods, drugs
precursors and cultural goods and on mutual administrative assistance in customs matters
as well as Community agreements in the areas concerned, including transit. Member
States must ensure that the necessary enforcement capacities, including links to the
relevant EC computerised customs systems, are in place.
Lithuania’s
customs legislation
is largely in line with the acquis up to 2002 except, i.a.
with regard to the application of simplified procedures. Implementation of the entire
acquis will take place upon accession, when the EC customs legislation becomes directly
applicable. National provisions superseded by the acquis are to be repealed at the time of
accession and agreements on mutual administrative assistance in customs matters are to
be amended as necessary.
Concerning
administrative and operational capacity,
a functioning customs
administration is in place; however, some significant delays have occurred in the
development of interconnectivity and operational capacity. Lithuania should continue to
carry out its Business Strategy and Operational Management Plan for 2003, which
already involved reducing the rather large number of small customs posts. The action
plan for reorganisation in terms of closure of customs offices and redeployment of staff
as a result of accession, when the volume of customs work decreases owing to the
conversion of external to internal trade, has been approved and should be carried out.
The necessary preparations for the application of measures and provisions that will be
introduced only at the time of accession should also be completed. In particular, training
of customs officials remains to be completed in order to ensure correct application of
these Community measures at the time of accession. Customs offices’ capacity to combat
fraud and economic crime and imports of counterfeit or pirated goods in close co-
operation with other enforcement bodies, as well as to fight corruption, should be
improved and effectively implemented.
Enhanced measures must be taken to complete the development and implementation of
the computerised customs system and solve all other interconnectivity-related issues. In
particular, Lithuania must speed up the development, procurement and implementation of
the contingency solutions for two accession-essential projects, namely the Tax
Calculation Module (TCM) and the Tariff Quota and Surveillance System (TQS): apart
from the contractual arrangements needed to procure the necessary services, which have
been finalised, work on these contingency solutions had not begun during the reporting
period. In addition, the software necessary to link the entry-processing system to the
integrated tariff system must be developed or procured without delay.
Conclusion
Lithuania is essentially meeting the commitments and requirements arising from the
accession negotiations in the area of
customs legislation.
Lithuania is partially meeting the requirements for membership concerning
operational
and administrative capacity,
where significant additional efforts are required in the
area of computerisation and interconnectivity, along with secure financial resources and
qualified staff, to ensure that work on the duty calculation module and quota-
management system is completed in time, as well as to implement an EC-compatible
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version of the entry-processing system used in Lithuania. Enhanced measures must be
taken, to make up for delays, and avoid any risk of disruption of the operation of
Community systems at the time of accession.
Chapter 26: External relations
The main element in this chapter, the common commercial policy, is made up of directly
binding EU legislation, which does not require transposition into national law. The
acceding countries were requested to align before accession with the
acquis
on dual use
goods and, where applicable, export credits. Acceding countries committed themselves to
ensure compatibility with the
acquis
of their bilateral agreements with third countries. In
the area of humanitarian aid and development policy, countries need to ensure the
capacity to participate in the EC’s development and humanitarian policies.
The administrative structures for dealing with the issues related to the
common
commercial policy
are in place and sufficient.
Lithuania has co-ordinated its positions and policies with the Commission with regard to
the Doha Development Agenda. Lithuania should continue close co-ordination and co-
operation with the Commission, mainly in order to carry on preparing the convergence of
its GATS commitments and Most Favoured Nation exemptions into the EU ones
(consolidation EU 25), to be finalised upon accession. Lithuania has used its third stage
of integration to align its list of integrated products under the Agreement on Textiles and
Clothing with the Community, although some discrepancies remain.
On trade in dual-use goods, Lithuania has reached a high degree of alignment with the
acquis. However, further alignment, in particular regarding the list of dual-use items,
needs to be achieved, as export control regimes continue to adopt decisions, which the
EU integrates into its legislation. Membership in all export control regimes is a crucial
factor enabling implementation of exports controls by Lithuania. Based on the
Thessaloniki Action Plan to support the acceding countries’ membership in export
control regimes, the EU supports Lithuania’s accession to the regimes to which it has
already applied but is not yet a member. The Commission reiterates its support to
Lithuania’s renewed intentions to apply to the Wassenaar regime and Australia group
before its accession to the EU. Full alignment as regards the Community general export
authorisation can only take place upon accession.
Legislative alignment in the area of export credits needs to be completed. Administrative
structures are in place and sufficient.
Lithuania needs to confirm that its
bilateral agreements with third countries
are in
conformity with the
acquis,
and to terminate or renegotiate those international
agreements that are found to be incompatible with the
acquis.
Following the successful
signtaure of the Memorandum of Understanding regarding the bilateral investment treaty
(BIT) between Lithuania and the USA, Lithuania must ensure swift ratification of the
Additional Protocols to the BIT, which were also signed with the US, in order for the
adaptations to enter into force by the date of its accession to the EU.
In the area of
humanitarian aid and development policy,
there is no policy framework
in force yet. Lithuania needs to pursue the shaping of a development policy in line with
EU principles, in particular with the guidelines laid down by the OECD Development
Assistance Committee as well as the commitments and objectives that Lithuania has
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approved in the context of the UN and other international organisations. Lithuania also
needs to ensure the necessary administrative capacity to participate in the EU’s
development and humanitarian policies.
Conclusion
Lithuania is essentially meeting the commitments and requirements arising from the
accession negotiations and is expected to be able to implement the
acquis
on the
common commercial policy
and
humanitarian aid and development policy.
Lithuania
should take further steps to provide itself with a development policy framework in line
with EU principles.
Lithuania is meeting the majority of the commitments and requirements for membership
in relation to
bilateral agreements with third countries.
In order to complete
preparations in the area of bilateral agreements with third countries, Lithuania must take
decisive steps towards renegotiating or terminating its bilateral agreements to make sure
that they are compatible with the
acquis
upon accession.
Chapter 27: Common foreign and security policy
The acquis related to the common foreign and security policy (CFSP) is essentially based
either on legally binding international agreements or on political agreements to conduct
political dialogue in the framework of CFSP, to align with EU statements, and to apply
sanctions and restrictive measures where required.
Lithuania has the required administrative capacity to participate in the
political dialogue.
With regard to alignment with
EU sanctions and restrictive measures, statements,
declarations and démarches,
Lithuania still needs to adopt the law on international
economic sanctions. The administrative structures in this area in Lithuania are in place
and function adequately.
Conclusion
Lithuania is essentially meeting the commitments and requirements arising from the
accession negotiations in the chapter on the
common foreign and security policy,
and is
expected to be able to participate in the political dialogue and to align with EU
statements, sanctions and restrictive measures by accession. The alignment concerning
international economic sanctions needs to be completed.
Chapter 28: Financial control
The acquis under this chapter consists mostly of general, internationally agreed and EU-
compliant principles of public internal financial control that need to be transposed into
the control and audit systems of the entire public sector. In particular, the acquis requires
the existence of adequate ex ante financial control and functionally independent internal
audit systems; an independent external audit of the public internal financial control
systems in the public sector; an appropriate financial control mechanism for EU pre-
accession funding and future structural action expenditure; and arrangements on the
protection of EC financial interests. In addition, an anti-fraud co-ordination service,
capable of co-operating with the Commission’s Anti-fraud Office OLAF at an
operational level, is to be designated.
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In the area of
public internal financial control,
Lithuania has put framework and
implementing legislation in place which is in line with the acquis. The establishment of
all public internal financial control related organisational structures has been completed,
but administrative capacity should be reinforced.
In the field of
external audit,
legislative alignment and implementation has been
completed. The State Control Office (SCO) needs to continue to incorporate international
audit standards into its current work. The SCO is functionally and operationally
independent and its audit services satisfactorily cover all public and EU funds. The
parliamentary Audit Sub-committee could be upgraded to a standing committee for
discussion of the SCO audit reports.
As regards
control over EU pre-accession funding and structural action expenditure,
framework and implementing legislation in Lithuania is in place and in line with the
acquis. Appropriate administrative structures are being set up and Lithuania should
continue to enhance its administrative capacity to manage the pre-accession funds and
future structural and cohesion funds in order to fully meet the requirements for financial
control and internal audit. In particular, recruitment of additional staff for the pre-
accession funds, and for the structural and cohesion funds, should be reinforced and
accompanied by training measures. Lithuania needs to reinforce and accelerate efforts to
implement the extended decentralised implementation system (EDIS) for ISPA and
Phare.
In the area of the
protection of EC financial interests,
Lithuania needs to complete the
framework and implementing legislation, in particular with a view to specifying the
powers of the anti-fraud co-ordination service with regard to Community funds.
Lithuania has designated the Financial Crime Investigation Service within the Ministry
of Interior as the anti-fraud co-ordinating service (AFCOS). Agreements with other law
enforcement agencies have been put in place. Operational co-operation with OLAF
through the AFCOS has been initiated.
Conclusion
Lithuania is essentially meeting the commitments and requirements arising from the
accession negotiations in the areas of
public internal financial control, external audit
and
protection of EC financial interests
and is expected to be in a position to
implement the
acquis
in these fields from accession. However, in the area of public
internal financial control, administrative capacity needs further strengthening. In the area
of the protection of EC financial interests, the focus should be placed on further refining
the legislative framework and on continuing to ensure the anti-fraud co-ordinating
service’s full operational capacity.
Lithuania is meeting the majority of the commitments and requirements arising from
accession negotiations in the area of
control over structural action expenditure.
In
order to complete preparations for membership, attention must be paid to strengthening
administrative structures. Enhanced efforts must be made to complete the extended
decentralised implementation system.
Chapter 29: Financial and budgetary provisions
Chapter 29 covers the rules concerning the financial resources necessary for the funding
of the EC budget (‘own resources’). These own resources are made up mainly from
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contributions from Member States based on 1) traditional own resources from customs
and agricultural duties and sugar levies, 2) a resource based on VAT and 3) a resource
based on the level of gross national income (GNI). Member States must ensure the
creation of appropriate administrative capacity to adequately co-ordinate and ensure the
correct calculation, collection, payment and control of own resources and reporting to the
EU for implementation of the own resources rules.
As regards the
traditional own resources (TOR),
a national reporting system on cases
of fraud and irregularity exists but will need to be developed further in order to comply
with the procedures for reporting to the Commission in line with the OWNRES system.
Lithuania plans to keep the A and B accounts in a new central accounting system
‘MAKIS’, which will be directly linked to the customs clearance system. However, it is
very likely that the new accounting system will not be operational by accession.
Therefore, a contingency plan has been devised by Lithuania to ensure that the A and B
accounts can be properly drawn up from accession. It should be noted that any delays in
fully and accurately applying EC customs rules will impact on the accuracy of TOR
calculations. The procedures and structure concerning sugar levies have been established
but need to be developed further. Some of the current accounting procedures (e.g. for
anti-dumping duties and incomplete declarations) still need to be adapted to comply with
Community legislation.
Considerable efforts are required by Lithuania for the correct calculation of the
VAT-
based resource,
in particular concerning the calculation of the weighted average rate in
accordance with ESA95.
For calculation of the
GNI-based resource,
continued efforts are needed to further
implement ESA95 and improve the quality and reliability of the national accounts and
GNI calculations, including their exhaustiveness.
All institutions necessary for application of the own resources system exist. A small
permanent unit has been established and is responsible for co-ordination of the
calculation, collection, payment and control of own resources. Further strengthening of
the administrative capacity is needed.
Conclusion
Lithuania is essentially meeting the commitments and requirements arising from the
accession negotiations in the area of
financial and budgetary provisions
and is
expected to be in a position to implement from accession the relevant
acquis.
Lithuania
now needs to focus its attention on improving the calculation of the VAT-based resource,
further developing the procedures for keeping the A and B accounts and the system of
reporting to the European Commission on fraud or irregularities (OWNRES). The
development of the new ‘MAKIS’ central accounting system and the accuracy of
traditional own resources calculations requires close attention.
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D.
C
ONCLUSION
In spite of lacklustre growth in the EU, macroeconomic performance in Lithuania
remained particularly strong during 2002. The authorities actively pursued their reform
path, although a number of areas — including pensions and fiscal structural reform —
still require progress.
As regards the areas, where last year’s report suggested improvements, some progress
has been made, but challenges remain. Although fiscal policy remains firmly committed
to further consolidation, several factors could put at risk the government’s fiscal
objective, and hence call for the formulation of a comprehensive fiscal strategy that takes
into account all pending financial obligations of the central and local governments. The
problem of high and persistent unemployment is being addressed through active labour
market policies but implementation of these policies is crucial. Pension reform has
advanced with the adoption of legislation by parliament, but the current plans fail to
address the problem of an impending social security deficit. Considerable progress has
been achieved in improving administrative and judicial capacity, specifically pertaining
to the legal framework for bankruptcy and enterprise restructuring and market entry, but
the authorities must proceed to complete their reform programme without delay.
As regards overall administrative and judicial capacity, sufficient conditions are in place
for the implementation of the
acquis
by the Lithuanian public administration and
judiciary but there is room for further improvements. In the field of public
administration, a number of areas should receive particular attention. These include the
recruitment and retention of both skilled professionals, and lower-ranking and local civil
servants, to implement the
acquis
including the management of the Structural Funds.
Additional staff, training and equipment are needed to complement recent reforms of the
judiciary and legal system, which are now nearing completion. The fight against
corruption should continue to receive high priority. While the legal framework and
institutional setting is being strengthened, efforts should be maintained to tackle
corruption in a systematic and effective way and to ensure adequate prevention. As far as
translation of the
acquis
into Lithuanian is concerned, the number of revised texts
prepared by Lithuania must increase greatly in the coming period up to accession.
As regards the implementation of the
acquis
in specific policy areas, the findings of this
report are set out below.
Firstly, it should be noted that Lithuania has reached a
high level of alignment with the
acquis
in most policy areas.
It is expected to be in a position to implement the
acquis
as required in the following
areas by accession: horizontal and procedural measures, new approach sectoral
legislation as well as public procurement and the non-harmonised area in the
free
movement of goods
chapter; citizens’ rights, free movement of workers and co-ordination
of social security systems in terms of
free movement of persons;
the banking sector, the
right of establishment and the freedom to provide non-financial services as well as the
protection of personal data and information society services in the area of
freedom to
provide services;
capital movements and payments in the field of
free movement of
capital; company law
and accounting; and
competition policy.
In the area of
agriculture,
Lithuania is expected to be in a position by accession to implement the
acquis
in a
number of horizontal areas. It is also expected to be in a position to implement the
acquis
in most common market organisations, in rural development and in certain veterinary
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issues, notably animal disease control measures, trade in live animals and animal
products, zootechnics and animal nutrition; and in
fisheries,
in the areas of state aid and
international agreements.
Lithuania is also expected to be in a position to implement the
acquis
by accession in :
the
transport
sector; in most areas in the field of
taxation; economic and monetary
union; statistics;
labour law, equal treatment of women and men, health and safety at
work, social dialogue, employment policy, social inclusion and social protection in the
field of
social policy and employment;
in the
energy
sector;
industrial policy; small and
medium-sized enterprises; science and research; education and training; culture and
audio-visual policy;
the legislative framework and programming in the field of
regional
policy and co-ordination of structural instruments;
the
environment
chapter; safety-
related measures and consumer organisations in terms of
consumer and health
protection;
many aspects of
justice and home affairs;
customs legislation in the field of
customs union;
the common commercial policy, the humanitarian aid and development
policy in the
external relations acquis,
the
common foreign and security policy;
most
aspects of
financial control; financial and budgetary provisions.
Secondly, in certain areas, Lithuania partially meets the commitments and requirements
and needs to make
enhanced efforts
in order to complete its preparations for accession.
This includes the old approach sectoral legislation on the
free movement of goods;
in the
area of
free movement of services,
the fields of insurance, investment services and
securities markets; in the field of
free movement of capital,
the completion of alignment
in the area of payment systems and the reinforcement of efforts in the fight against
money laundering; and, within the area of
company law,
the protection of intellectual and
industrial property rights. In the
agriculture
area, it concerns the Paying Agency, the
Integrated Administration and Control System (IACS), trade mechanisms, the common
market organisations for milk and beefmeat, transmissible spongiform encephalopathies
(TSEs) and animal by-products, the veterinary control system, public health in agri-food
establishments, common measures, animal welfare and the phytosanitary field; and
structural actions and market policy in the
fisheries
policy.
This also includes the fields of:
taxation,
as regards administrative co-operation and
mutual assistance; public health, European Social Fund and anti-discrimination in the
area of
social policy and employment; telecommunications and information technologies,
including the postal sector; finalising the delivery system of its institutional structures
and finalising its procedures for financial management and control in the field of
regional policy and co-ordination of structural instruments;
market surveillance and
non-safety measures in the area of
consumer and health protection;
migration, asylum,
police co-operation and the fight against organised crime, money laundering, and fraud
and corruption in the area of
justice and home affairs;
operational and administrative
capacity in the field of
customs union; external relations
as regards bilateral agreements
with third countries; and control over structural action expenditure in the area of
financial control.
Thirdly, Lithuania must take immediate and decisive action to address two issues of
serious concern
in two chapters of the
acquis
if it is to be ready by the date of accession.
This concerns the field of
free movement of persons,
relating to Lithuania’s preparations
for mutual recognition of qualifications. It also concerns the area of
fisheries,
as regards
inspection and control in relation to resource and fleet management.
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1465026_0056.png
S
TATISTICAL ANNEX
1998
Basic data
Population (average) a)
Total area
National accounts
Gross domestic product at current prices
Gross domestic product at current prices
Gross domestic product per capita b) at current
prices
Gross domestic product at constant prices (nat.
currency)
Employment growth
Labour productivity growth
Unit labour cost growth
Gross domestic product per capita b) at current
prices
GDP per capita b) at current prices in PPS
Labour productivity (GDP per person employed in
PPS)
Structure of production
- Agriculture
- Industry (excluding construction)
- Construction
- Services
Structure of expenditure
- Final consumption expenditure
- household and NPISH
- general government
- Gross fixed capital formation
- Stock variation d)
- Exports of goods and services
- Imports of goods and services
Inflation rate
Consumer price index
43.6
9.7
2,700
3,549
65,300
1999
3,524
65,300
2000
in 1000
3,500
in km²
65,300
2001
3,481
65,300
2002
3,469
65,300
1000 Mio Litas
42.6
10.0
2,800
44.7
12.1
in ECU/Euro
3,500
3,800
4,200
47.5
13.3
50.7
14.6
1000 Mio ECU/euro
% change over the previous year
7.3
-0.8
8.2
2.0
6.000
-1.8
-0.5
-1.3
7.6
7,300
4.0
-3.7
8.0
-6.4
8,000
6.5
-4.0
11.0
-6.4
8,900
6.7
-8.1
16.1
0.0
9,400
in Purchasing Power Standards
in % of EU-15 average
32
30
34
32
35
34
38
39
39
43
% of Gross Value Added c)
10.0
23.7
8.6
57.8
85.4
60.7
24.7
24.6
1.7
46.6
58.3
8.5
23.3
7.8
60.5
87.2
64.6
22.6
22.6
0.5
39.8
50.1
8.0
24.4
6.0
61.6
86.3
64.2
22.1
19.2
1.0
45.7
52.2
7.2
25.4
6.1
61.3
84.5
64.3
20.2
20.6
0.4
50.9
56.4
7.1
24.3
6.5
62.2
83.1
62.6
20.4
21.5
1.1
54.1
59.8
as % of Gross Domestic Product
% change over the previous year
5.0
0.7
0.9
1.3
0.4
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1998
Balance of payments
-Current account
-Trade balance
Exports of goods
Imports of goods
-Net services
-Net income
-Net current transfers
-
of which: government transfers
- FDI (net) inflows
Public finance
General government deficit/surplus
General government debt
Financial indicators
Gross foreign debt of the whole economy
Gross foreign debt of the whole economy
Monetary aggregates
- M1
- M2
- M3
Total credit
Average short-term interest rates
- Day-to-day money rate e)
- Lending rate
- Deposit rate
ECU/EUR exchange rates
- Average of period
- End of period
- Effective exchange rate index
Reserve assets
-Reserve assets (including gold)
-Reserve assets (excluding gold)
External trade
Trade balance
Exports
Imports
Terms of trade
Exports with EU-15
Imports with EU-15
-1,895
2.881
4.776
100.7
38.0
47.2
1,254
1,208
4.484
4.667
547.0
6.1
11.5
6.6
:
1.4
1.2
1.8
-1,158
-1,354
3,534
4,888
215
-228
210
92
826
1999
-1,120
-1,318
2,952
4,269
286
-242
153
55
456
2000
in Mio ECU/euro
-731
-1,195
4,385
5,579
411
-210
263
68
410
2001
-641
-1,237
5,459
6,696
510
-201
288
39
497
2002
-772 g)
:
:
:
:
:
:
:
772 g)
in % of Gross Domestic Product
-3.1
17.1
-5.7
23.4
-2.6
24.3
-2.2
23.4
-2.0p
22.7p
in % of Gross Domestic Product
16.9
24.5
25.8
24.8
as % of exports
36.4
61.6
1.3
2.2
:
1.8
6.3
12.6
7.6
4.264
4.017
:
1.9
3.6
11.8
7.2
3.695
3.723
% per annum
3.4
9.4
5.2
3.582
3.523
955.1
1,895
1,837
56.4
1.5
2.8
:
2.1
48.8
1.9
3.6
:
:
2.4
4.3
:
2.6
2.6
6.9
3.1
3.459
3.453
1,034.5
2,319
2,260
1000 Mio ECU/euro
(1ECU/euro=..Litas)
1993=100
786.7
920.2
Mio ECU/euro
1,243
1,190
1,464
1,409
Mio ECU/euro
-1,764
2,585
4,349
100.8
50.1
46.5
-1,826
3.855
5.681
101.1
47.9
43.3
-1,989
4.781
6.770
100.6
47.8
44.0
-2,421
5,537
7.958
99.9
48.4
44.5
previous year=100
as % of total
57
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1465026_0058.png
1998
Demography
Natural growth rate
Net migration rate (including corrections)
Infant mortality rate
Life expectancy :
Males:
Females:
Labour market (Labour Force Survey)
Economic activity rate (15-64)
Employment rate (15-64), total
Employment rate (15-64), males
Employment rate (15-64), females
Employment rate of older workers (55-64)
Average employment by NACE branches
- Agriculture and forestry
- Industry (excluding construction)
- Construction
- Services
Unemployment rate, total
Unemployment rate, males
Unemployment rate, females
Unemployment rate of persons < 25 years
Long-term unemployment rate
Social cohesion
Inequality of income distribution
Early school-leavers
Population in jobless households (persons aged
0-65)
Standard of living
Number of cars
Main telephone lines f)
Number of subscriptions to cellular mobile
services
Infrastructure
Railway network
Length of motorways
40
417
277
314
76
:
11.4
20.7
21.6
6.7
50.9
11.8
13.1
10.4
23.7
7.4
72.1
63.2
67.8
66.0
76.7
-1.1
-6.2
9.2
1999
-1.0
-5.9
8.6
66.4
77.0
2000
-1.3
-5.8
8.5
at birth
66.8
77.5
2001
-2.5
-0.7
7.8
66.0
77.6
2002
-3,2
-0.6
7.9
66.2
77.6
per 1000 of population a)
per 1000 live-births
% of population
72.6
64.0
67.5
71.5
60.1
61.9
70.4
58.4
59.9
69.8
59.9
62.7
58.9
60.7
58.5
57.1
57.2
as % of the total population of the same age group
40.5
42.4
21.4
20.0
6.5
52.1
11.2
12.3
10.0
21.3
5.0
41.6
in % of total
18.4
21.5
5.9
54.2
15.7
17.9
13.4
27.5
8.3
16.5
21.2
5.9
56.3
16.1
18.4
13.8
30.9
9.0
18.6
20.0
7.3
54.0
13.1
13.3
13.0
20.4
7.0
39.3
41.6
% of labour force
ratio of top quintile to lowest quintile
4.8
:
9.6
5.0
:
17.2
10.2
:
14.2
11.2
:
14.3
10.2
% of population aged 18-24
% of population aged 0-65
Per 1000 inhabitants a)
310
326
98
336
338
146
326
329
293
341p
268.0
471p
in km per 1000 km²
38
Km
417
417
417
417
38
26
27
58
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1465026_0059.png
1998
Industry and agriculture
Industrial production volume indices
Gross agricultural production volume indices (in
prices 1993)
Innovation and research
Spending on Human
expenditure on education)
Resources
(public
6.83
112.1
94.8
1999
90.1
85.5
2000
102.2
105.4
2001
116.0
94.6
2002
103.1
106.0
previous year=100
as % of GDP
6.19
6.04
5.90E
:
as % of GDP
Gross domestic expenditure on Research &
Development
Level of Internet access – households
Environment
Total greenhouse gases emissions
Energy intensity of the economy
Share of renewable energy
Modal split of freight transport
p=provisional figures
E=estimated data
a) Data recalculated on the basis of the Population Census 2001.
b) Figures have been calculated using the population figures from National Accounts, which may differ from those used in
demographic statistics.
c) Including FISIM.
d) These figures include changes in inventories, acquisitions less disposals of valuables and the statistical discrepancy
between the GDP and its expenditure components.
e) Series break after 2001.
f) Data without pay-phones.
g) Source: Website of the National Bank
0.57
0.52
0.60
0.68
:
per 1000 inhabitants
:
:
2.3
3.2
:
tonnes CO2 equivalent per capita
46.3
1,071.2
3.6
40.4
46.3
1,025.7
3.8
49.6
46.3
926.9
3.4
46.5
:
:
:
51.7
:
:
:
:
kg of oil equivalent per 1000 euro of GDP
as % of total electricity consumption
as % of total freight transport
Methodological notes
Inflation rate
For
details
please
refer
to
the
following
link
to
the
Eurostat
website:
http://europa.eu.int/newcronos/suite/info/notmeth/en/theme1/strind/ecobac_ir.htm
Finance
Public finance:
The general government deficit / surplus refers to the national accounts concept of
consolidated general government net borrowing / net lending (EDP B.9) of ESA95. General government
debt is defined as consolidated gross debt at end-year nominal value.
External trade
Imports and exports (current prices).
The data is based upon the special trade system. Trade Classification:
Trade in goods are recorded using the commodity classification according to the Combined Nomenclature.
Imports are recorded on CIF basis, exports on FOB basis.
Imports and exports with EU-15.
Data declared by Lithuania.
Labour market
Indicators are harmonised annual figures with the exception of average employment by NACE branches
and unemployment rate of persons < 25 years, which are for the 2
nd
quarter of the respective year. The
59
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1465026_0060.png
results are based on the European Union Labour Force Survey (LFS). The EU LFS is conducted on a
quarterly basis in accordance with Council Regulation (EEC) No. 577/98 of 9 March 1998.
For
details
please
refer
to
the
following
link
on
the
Eurostat
website:
http://europa.eu.int/newcronos/suite/info/notmeth/en/theme1/strind/emploi.htm
Social cohesion
For
details
please
refer
to
the
following
link
on
the
Eurostat
website:
http://europa.eu.int/newcronos/suite/info/notmeth/en/theme1/strind/socohe.htm
Industry and agriculture
Industrial production volume indices.
Industrial production covers mining and quarrying, manufacturing
and electricity, gas, steam and water supply (according to the NACE Rev.1 Classification Sections C, D,
and E). Production volume indices are calculated at constant prices 2000 and out of them monthly changes
and indices of production are derived.
Gross agricultural production volume indices.
Gross agricultural production volume indices are calculated
in constant prices of previous year.
Innovation and research
For
details
please
refer
to
the
following
link
to
the
Eurostat
website:
http://europa.eu.int/newcronos/suite/info/notmeth/en/theme1/strind/innore.htm
Environment
For
details
please
refer
to
the
following
link
to
the
Eurostat
website:
http://europa.eu.int/newcronos/suite/info/notmeth/en/theme1/strind/enviro.htm
Sources
Total area, External trade, Demography, Standard of living, Infrastructure, Industry and agriculture:
National sources. Other indicators: Eurostat.
60