EUU, Alm.del - 2021-22 - Bilag 579: Kommissionens udtalelser vedr. Ukraines, Moldovas og Georgiens ansøgninger om EU-medlemskab

Europaudvalget 2021-22
EUU Alm.del Bilag 579
Offentligt

Council of the

European Union

Brussels, 17 June 2022

(OR. en)

10322/22

ELARG 47

COEST 466

COVER NOTE

From:

date of receipt:

To:

No. Cion doc.:

Subject:

Secretary-General of the European Commission, signed by Ms Martine

DEPREZ, Director

17 June 2022

General Secretariat of the Council

COM(2022) 406 final

COMMUNICATION FROM THE COMMISSION

Commission Opinion on the Republic of Moldova’s application for

membership of the European Union

Delegations will find attached document COM(2022) 406 final.

Encl.: COM(2022) 406 final

10322/22

RELEX.4

GL/sb

EUU, Alm.del - 2021-22 - Bilag 579: Kommissionens udtalelser vedr. Ukraines, Moldovas og Georgiens ansøgninger om EU-medlemskab

EUROPEAN

COMMISSION

Brussels, 17.6.2022

COM(2022) 406 final

COMMUNICATION FROM THE COMMISSION TO THE EUROPEAN

PARLIAMENT, THE EUROPEAN COUNCIL AND THE COUNCIL

Commission Opinion on the Republic of Moldova’s application for membership of the

European Union

EUU, Alm.del - 2021-22 - Bilag 579: Kommissionens udtalelser vedr. Ukraines, Moldovas og Georgiens ansøgninger om EU-medlemskab

A. INTRODUCTION

In the past two years, the Republic of Moldova (hereinafter Moldova) has taken a decisive

step towards reforms, with a clear mandate from its citizens. Following the 2020 presidential

and 2021 parliamentary elections, there is a clear alignment of the presidential, executive and

legislative powers on a pro-reform, anti-corruption European path for the first time since

independence. This follows a period where the independence of key institutions was seriously

compromised.

The Russian war of aggression against Ukraine is having serious effects on Moldova. In a real

spirit of solidarity and upholding European values, Moldova is actively supporting those

fleeing Ukraine, hosting the highest number of refugees

per capita.

Despite this challenge, the

Moldovan government is strongly committed to delivering on its clear reform goals

–

notably

as regards judicial reform, public administration reform and the modernisation of the

economy

–

to benefit the people of Moldova. Recent Eurobarometer survey results show

increased support for EU integration and that the EU is the most trusted foreign organisation.

a) Application for membership

On 3 March 2022, the Republic of Moldova presented its application for membership of the

European Union. The application was tabled in the context of Russia’s war of aggression

against Ukraine. On 7 March, the Council of the European Union invited the Commission to

submit its Opinion on the application. EU Heads of State and Government endorsed this

decision at the informal leaders’ meeting in Versailles

. Moldova received questionnaires on

11 April 2022 (on the political and economic criteria) and on 19 April (on the EU

acquis

chapters) and provided its replies on 22 April and on 12 May, respectively.

Article 49 of the Treaty on European Union states that

‘Any European State which respects

the values referred to in Article 2 and is committed to promoting them may apply to become a

member of the Union. The European Parliament and national Parliaments shall be notified of

this application. The applicant State shall address its application to the Council, which shall

act unanimously after consulting the Commission and after receiving the consent of the

European Parliament, which shall act by a majority of its component members. The

conditions of eligibility agreed

upon by the European Council shall be taken into account’.

Article 2 of the Treaty on European Union states that

‘the Union is founded on the values of

respect for human dignity, freedom, democracy, equality, the rule of law and respect for

human rights, including the rights of persons belonging to minorities. These values are

common to the Member States in a society in which pluralism, non-discrimination, tolerance,

justice, solidarity and equality between women and men prevail’.

This is the legal framework within which the Commission submits the present Opinion.

In June 1993, in Copenhagen, the European Council concluded that:

‘Accession will take place as soon as a country is able to assume the obligations of

membership by satisfying the economic and political conditions required.

Membership requires:

that the candidate country has achieved stability of institutions guaranteeing

democracy, the rule of law, human rights and respect for and protection of minorities;

20220311-versailles-declaration-en.pdf (europa.eu)

EUU, Alm.del - 2021-22 - Bilag 579: Kommissionens udtalelser vedr. Ukraines, Moldovas og Georgiens ansøgninger om EU-medlemskab

the existence of a functioning market economy, as well as the capacity to cope with

competitive pressure and market forces within the Union;

the ability to take on the obligations of membership including adherence to the aims of

political, economic and monetary

union’.

In December 1995, in Madrid, the European Council referred to the need

‘to create the

conditions for the gradual, harmonious integration of [the applicant] countries, particularly

through the development of the market economy, the adjustment of their administrative

structures and the creation of a stable economic and monetary environment’.

In December 2006, the European Council agreed that

‘the enlargement strategy based on

consolidation, conditionality and communication, combined with the EU's capacity to

integrate new members, forms the basis for a renewed consensus on enlargement’.

In this Opinion, the Commission assesses Moldova’s application on the basis of its capacity to

meet the criteria set by the European Council in Copenhagen in 1993, as well as in Madrid in

1995, notably regarding the country’s administrative capacity. The Opinion

also takes into

account Moldova’s efforts in implementing its obligations under the Association Agreement

(AA) including a Deep and Comprehensive Free Trade Area (DCFTA). The Commission will

assess the impact of Moldova’s accession on the EU policy

areas at a later stage.

b) Relations between the European Union and Moldova

EU-Moldova relations date back to the independence of Moldova in August 1991. In

November 1994 a Partnership and Cooperation Agreement was signed which entered into

force in July 1998. Political and economic cooperation was enhanced with the beginning of

negotiations on an Association Agreement in 2010.

The Association Agreement, including a Deep and Comprehensive Free Trade Area, was

signed in June 2014

and fully entered into force on 1 July 2016. This agreement is the key

bilateral legal instrument serving as the basis for deepening political ties, stronger economic

linkages, promotion of common values and enhanced cooperation in areas of mutual interest.

In its preamble, the EU acknowledged the European aspirations and European choice of

Moldova, including its commitment to building a deep and sustainable democracy and a

market economy. Based on the AA/DCFTA, Moldova has carried out a number of

challenging reforms and successfully aligned its legislation with the EU in many areas. The

EU-Moldova Civil Society Platform (CSP) is one of the bodies set up under the Association

Agreement. It enables civil society organisations on both sides to monitor the implementation

process and prepare recommendations to the relevant authorities.

The subsequent Association Agendas agreed between the EU and Moldova establish clear

priorities in order to implement the Association Agreement and its DCFTA. Adoption of the

Association Agenda (2021-27), which focuses on democracy, human rights and good

governance; freedom, security and justice; and economic, trade and sectoral cooperation, is

imminent.

The EU remains fully committed to support a comprehensive, peaceful and sustainable

settlement of the Transnistrian conflict, based on the sovereignty and territorial integrity of

the Republic of Moldova in its internationally recognised borders, with a special status for

Transnistria.

https://eur-lex.europa.eu/legal-content/EN/TXT/PDF/?uri=CELEX:22014A0830(01)&from=EN

EUU, Alm.del - 2021-22 - Bilag 579: Kommissionens udtalelser vedr. Ukraines, Moldovas og Georgiens ansøgninger om EU-medlemskab

The EU’s commitment to supporting Moldova is long-standing

and has delivered results. The

EU provides significant financial assistance, which over the years 2014-2021 amounted to

EUR 512 million in grants under the European Neighbourhood Instrument, and EUR 160

million under the Macro-Financial Assistance programme in the form of loans and grants to

support socio-economic development. The EU provides its support through policy

development and comprehensive reforms, with strong involvement from Member States in a

Team Europe spirit. Among the key programmes are support for pre-vetting of judges and

prosecutors, support to increase Moldova’s energy security, and a team of High Level

Advisers to the Moldovan government in areas of particular importance.

EUR 7 million from the European Peace Facility have been allocated in 2021- to strengthen

the capacities of the military medical service and engineering battalion.

Since the energy crisis in autumn 2021, threatening security of supply and tripling energy

prices, and the beginning of Russia’s war of aggression against Ukraine, the EU has stepped

up its support for Moldova’s overall economic, social and financial resilience,

with

emergency macro-financial assistance worth EUR 150 million and EUR 60 million in budget

support in response to the energy crisis. The EU provided humanitarian assistance to help

Moldova to face the flow of refugees from Ukraine. The Economic and Investment Plan for

the Eastern Partnership

seeks to unlock EUR 3.4 billion in public and private investments for

economic development of the country, including tailored flagship investments.

The EU and other financial institutions work hand in hand to assist Moldova. Since 2014, the

European Investment Bank and the European Bank for Reconstruction and Development have

allocated EUR 425 million and EUR 777 million respectively in loans. The EU is also

working in close cooperation with the World Bank and the International Monetary Fund,

which have been key partners supporting Moldovan reform efforts since 2014.

Citizens of Moldova benefit from visa-free travel to the Schengen area since April 2014. A

Readmission Agreement entered into force in January 2018.

Moldova is a contracting Party to the Energy Community Treaty and the Agreement on the

Common Aviation Area, and a member of the Central European Free Trade Agreement, all of

which assist in approximating Moldovan legislation to EU

acquis.

Moldova is a member of

the United Nations, the Council of Europe, and the Organization for Security and Co-

operation in Europe (OSCE).

Since 2014, Moldova has progressively extended its participation in EU programmes. It

currently takes part in Horizon Europe, and organisations and individuals from Moldova can

also benefit from certain actions of the Erasmus+ and European Solidarity Corps

Programmes. There are regular Ministerial level dialogues between Moldova and the EU on

Trade, Energy and Security. Moldova participates in several Interreg programmes and is a

member of the EU macro-regional Strategy for the Danube region.

Moldova has concluded working arrangements, cooperation agreements or memoranda of

understanding with a number of EU agencies such as the European Border and Coast Guard

Agency (Frontex); the European Union Aviation Safety Agency (EASA); the European Union

Agency for Railways (ERA), the European Union Agency for Criminal Justice Cooperation

(EUROJUST); the European Fisheries Control Agency (EFCA), the European Agency for

Safety and Health at Work (EU-OSHA), the European Environment Agency (EEA), the

European Food Safety Authority (EFSA), the European Centre for Disease Prevention and

SWD(2021) 186 final

EUU, Alm.del - 2021-22 - Bilag 579: Kommissionens udtalelser vedr. Ukraines, Moldovas og Georgiens ansøgninger om EU-medlemskab

Control (ECDC), the European Union Agency for Law Enforcement Training (CEPOL), the

European Training Foundation (ETF), the European Monitoring Centre for Drugs and Drug

Addiction (EMCDDA), the European Union Intellectual Property Office (EUIPO), the

European Police Office (Europol), and the European Maritime Safety Agency (EMSA).

Moldova is a participant in the Eastern Partnership (EaP). The EaP is based on the principle

of inclusivity and differentiation. Russia’s war in Ukraine has shown that multilateral

cooperation and cohesion is now more important than ever, as is strengthening the resilience

of the region. A focus on bilateral relations will also be important going forward, to allow

Moldova to implement key reforms including in the field of governance, justice and rule of

law.

B. CRITERIA FOR MEMBERSHIP

1. POLITICAL CRITERIA

This assessment is based on the Copenhagen criteria relating to the stability of institutions

guaranteeing democracy, the rule of law, human rights and respect for and protection of

minorities.

1.1. Democracy

As established by its Constitution, Moldova is a

parliamentary democracy:

legislative

powers are exercised by the parliament and executive powers by the government. The

President of the Republic

has a mostly representative function but holds formal

responsibility for foreign policy and provides civilian oversight of the armed forces.

Executive power is exercised by the Government, consisting of a Prime Minister and 15

ministers.

The

Constitution

guarantees the fundamental principles of a democratic state, including the

rule of law, free elections and the protection of human rights. The Constitution enshrines the

principle of primacy of international law over domestic law. The

Constitutional Court

was

recomposed in 2019 and is now independent. The Supreme Court is the highest court of

general jurisdiction, while the Constitutional Court exercises constitutional jurisdiction.

The

Parliament

is the sole body of legislative power adopting legislation, including

amendments to the Constitution, and exercises democratic control and oversight over the

executive. The Parliament’s oversight function and control over the government and its

scrutiny of legislative development (including monitoring the implementation of legislation)

are limited by the capacity of parliamentary institutions. More must be done to ensure the

transparency of funding of political parties.

The Constitution gives citizens the ability to choose their government in free and fair periodic

elections held by secret ballot and based on universal and equal suffrage. While the latest

rounds of parliamentary

elections

in July 2021 were, according to the Office for Democratic

Institutions and Human Rights (ODIHR), well administered and competitive and fundamental

freedoms were largely respected, several further recommendations by ODIHR remain to be

addressed in areas such as effective campaign finance oversight, political bias of news outlets

and the impartiality of the Central Election Committee.

EUU, Alm.del - 2021-22 - Bilag 579: Kommissionens udtalelser vedr. Ukraines, Moldovas og Georgiens ansøgninger om EU-medlemskab

The use of urgent procedures to pass legislation, including in areas relevant to the EU

acquis,

has fallen considerably over the past four years. Comprehensive impact assessments of

proposed legislation are needed.

The Constitution guarantees freedom of assembly and association and a 2020 law on non-

commercial organisations simplifies registration and eliminates registration fees and

restrictions on membership. A Strategy and Action Plan for

Civil Society

Development are in

place. Civil society organisations

have the capacity to be important partners in the country’s

development. Setting up a systematic public consultation procedure would enable them to

make a more meaningful contribution to the reform process.

1.2. Public administration reform

Moldova’s

strategic framework for public administration reform

(PAR) is based on the

2016-2020 PAR strategy (extended to 2022). The legal framework and the civil service

system are mostly in line with European public administration principles and European

standards and practices. The PAR strategy aims to guarantee quality, stability, neutrality and

continuity of public administration and to ensure transparent merit-based recruitment,

promotion and dismissal procedures. A new PAR strategy is in development. Further efforts

are needed to ensure adequate administrative capacity to develop, implement and enforce

legislation.

service delivery,

the government’s Action Plan for 2021-2022

contains key objectives,

result/outcome indicators and priority actions in the field of good governance and digital

transformation policy, dedicated to modernising public administrative services, increasing the

quality and accessibility of public services provided to citizens and businesses, and extending

and improving electronic services provided to citizens and entrepreneurs. A more citizen-

oriented administration is a key government priority and a common strategic vision for

digitalisation and e-Government has been developed.

The Government remains committed to the implementation of the

Public Finance

Management

(PFM) Strategy (2013-2020), which has been extended to the end of 2022. The

authorities have made some progress on PFM reforms. The Ministry of Finance has continued

to improve the medium-term budgetary framework process and transparency and strengthened

the regulatory framework for financial management and internal control. The legislature and

supreme audit institution provide oversight of the budget process. The Government is

working to make further improvements in a number of areas, including transparency, public

investment planning and execution, accounting standards, internal control and audit,

governance of state-owned enterprises, public procurement and e-procurement, and involving

civil society in the budgetary processes. The preparation and implementation of a new PFM

strategy is expected following the next Public Expenditure and Financial Accountability

(PEFA) assessment.

With respect to

multi-level governance,

the decentralisation process has been evolving since

2012. The revised roadmap for local and regional democracy is expected to give new impetus

to this process. Against this background, territorial reform needs to empower local authorities

with sustainable finances that deliver services to citizens. In December 1994, the Parliament

of the Republic of Moldova adopted the "Law on the Special Legal Status of Gagauzia",

establishing Gagauzia as an autonomous territorial unit of Moldova.

Improving the

public service and human resources management

has not yet achieved the

desired impact of building a professional and merit-based civil service, due to political

instability and lack of political will impacting reforms. Attracting and retaining professional

EUU, Alm.del - 2021-22 - Bilag 579: Kommissionens udtalelser vedr. Ukraines, Moldovas og Georgiens ansøgninger om EU-medlemskab

civil servants is an ongoing challenge, and crucial to build administrative capacity to fulfil the

functions of the state and deliver quality services. Moldova is working on a civil service

salary reform to make public service more attractive.

The institutions and the legal framework for

policy development and coordination

are in

place. Quality of policy making needs to be further improved through proper processes and

implementation of the law. Strengthened coordination should focus more on substance and

less on formal, procedural issues, and the use of inclusive and evidence-based policy and

legislative development strengthened, including public and inter-ministerial consultations on

legislative proposals.

In order to ensure coherent

accountability

lines and governance, there is a need to update the

legal framework, and to focus on proper implementation, with clear structures that define

supervisory and subordinated bodies. The government supports reform of managerial

accountability and a systematic delegation of responsibilities. Civil society organisations

continue to call for increased transparency in decision-making in parliament and other public

authorities.

1.3. Rule of law

Since the 2014 banking fraud Moldova has undertaken a major overhaul of both its justice

and anticorruption systems. In recent years, Moldova has strengthened the rule of law,

including police reform and steps towards reforming the judiciary. More needs to be done to

address the influence of vested interests in both the political and commercial spheres.

a) Judiciary

Since 2009, Moldova has undergone a series of judicial reforms aimed at strengthening the

independence, efficiency, and effectiveness of the judiciary. Justice reforms are a priority for

the current government. Moldova has recently adopted a comprehensive Strategy for Ensuring

the Independence and Integrity of the Justice Sector 2022-2025 and a corresponding Action

Plan. The constitutional and legal framework for the judiciary is largely in line with European

standards. Law enforcement and judicial structures have been consolidated.

The Superior Council of Magistracy (the High Judicial Council) and the Superior Council of

Prosecutors (the High Prosecutorial Council) are responsible for the self-government of the

judiciary. The constitutional and legislative framework in principle guarantee the

independence of the judiciary and its impartiality. In practice, the integrity, independence and

accountability of the judiciary need to be significantly improved.

Constitutional amendments regarding the functioning of the judiciary entered into force in

April 2022. The amendments significantly improve the legal framework concerning the

independence, accountability, and efficiency of the judiciary and judicial administration, in

accordance with recommendations from the Council of Europe. In particular, the amendments

bring the composition of the Superior Council of Magistracy in line with European standards

by excluding

ex-officio

membership and revising the appointment process of Superior Council

of Magistracy lay members. This strengthens the role of the President in the appointment of

judges, regulating the functional immunity of judges at the constitutional level, and changing

the appointment procedure of judges of the Supreme Court of Justice to reduce the risk of

politicisation.

In March 2022, the law on pre-vetting of candidates to judicial and prosecutorial councils was

adopted. The law foresees an assessment of the integrity of future members of the Superior

Council of Magistracy, of the Superior Council of Prosecutors and their specialised bodies by

EUU, Alm.del - 2021-22 - Bilag 579: Kommissionens udtalelser vedr. Ukraines, Moldovas og Georgiens ansøgninger om EU-medlemskab

an Evaluation Committee composed of three national and three international members. This

aims to increase the integrity of the self-administration bodies of judges and prosecutors, as

well as enhance the confidence of society in their activity and the justice system as a whole.

Recommendations of the Venice Commission were mainly implemented. The Evaluation

Committee is set to complete the first stage of evaluation by July 2022.

Codes of ethics for judges and prosecutors are in place, as well as an integrated case

management system with automated allocation of cases. The appointment of judges and

prosecutors is still not entirely based on objective criteria. Undue internal and external

interference on the judiciary needs to be tackled. Vacancies in the Superior Council of

Magistracy, and in its specialised bodies, have not been filled by the General Assembly of

Judges, leaving the Superior Council of Magistracy without the necessary quorum to appoint

new judges for two years. The reform of this institution is ongoing and is a political priority.

The number of judges (16.4) per 100 000 inhabitants is lower than the European average (21)

and the number of prosecutors (24.2) is double the European average (12).

In terms of efficiency, disposition time in civil and commercial litigious cases increased to

171 days in 2020, compared to 143 days in 2018. The clearance rate decreased to 97 % (107

% in 2018). The disposition time remains a major concern. The backlog for pending court

cases amounts to 22 299 and 3 330 cases for the first and second instances, respectively

.. The

2020 budget for the judiciary system is 0.40 % of GDP, which is less than 2018 (0.48 % of

GDP). In 2020, EUR 21.3 million was allocated to courts and EUR 17.4 million to the

prosecutors’

office. The budget is insufficient to cover training and investment needs, since

85 % is spent on salaries and compensation.

The full functional independence of the Prosecution Service needs to be strengthened, as well

as the efficiency of the General Prosecutors Office. Decisions affecting management and

leadership of the Moldovan Prosecution Service are at times politically motivated, such as the

removal, (temporary) replacement and arrest of the Anti-corruption Prosecutor in 2021.

b) Fight against corruption

Combating and preventing corruption is high on the reform agenda of the Moldovan

government. Moldova has increased the annual budget of its anti-corruption institutions

including the National Integrity Authority, the Criminal Asset Recovery Agency and the

Financial Investigation Unit. Corruption remains a serious concern that requires continued

attention as it imposes significant costs on the state budget, businesses and the population,

discourages domestic and foreign investment and undermines the rule of law.

The main

policy document

for preventing corruption and increasing integrity is the National

Integrity and Anti-Corruption Strategy for 2017-2023. The Strategy includes actions

regarding recovery of criminal assets, protecting whistle-blowers, strengthening ethics and

integrity in the public, private and non-governmental sectors, ensuring transparency of public

institutions and of political party financing and media.

Moldova is a party to all key international anti-corruption conventions, including the Council

of Europe’s Group of States against Corruption (GRECO) and the United Nations Convention

against Corruption (UNCAC). A comprehensive

legal framework

on both preventing and

combatting corruption, largely complying with European and international standards, is in

place and partly implemented. All forms of corruption are criminalised, including illicit

enrichment, and the laws regulate conflict of interests and protect whistle-blowers.

As reported by the Council of Europe European Commission for the Efficiency of Justice.

EUU, Alm.del - 2021-22 - Bilag 579: Kommissionens udtalelser vedr. Ukraines, Moldovas og Georgiens ansøgninger om EU-medlemskab

Specialised

anti-corruption institutions

have been established and are operating

–

the

National Anticorruption Centre (NAC), with the Criminal Asset Recovery Agency (CARA)

as an autonomous subdivision, the Anti-corruption Prosecutor Office (APO) and the National

Integrity Agency (NIA). These institutions have comprehensive mandates in line with

international standards and increasingly operate independently, with interagency co-

ordination and required resources partly in place. Further efforts are needed to clarify the

mandates of these institutions and strengthen the effectiveness of the National Anticorruption

Centre and the National Integrity Agency.

Progress is needed to bring corruption cases to court and prosecute them effectively. The

investigation of petty corruption cases remains within the competences of National

Anticorruption Centre and Anti-corruption Prosecutor Office. This means that it has not been

possible for these institutions to focus on high-level corruption cases. More needs to be done

to effectively verify asset declarations and secure asset recovery. Some recommendations

from international and regional anti-corruption monitoring mechanisms, including from the

Council of Europe’s Group of States against Corruption (GRECO), are outstanding. On the

preventive side, the National Integrity Agency is responsible for verifying declared assets

submitted by persons holding public positions and applying the legal regime relating to

conflicts of interest. The National Anticorruption Centre has been corruption-proofing draft

legislation since 2017, with around 50% of recommendations accepted (mostly related to

ambiguities or gaps in drafting or administrative procedures).

There has been little progress in investigating the 2014 banking fraud and bringing those

responsible to justice. Efforts against bank fraud should be strengthened by updating the

criminal asset recovery strategy and setting up a new asset recovery mechanism.

c) Organised crime

Moldova has signed and ratified the United Nations Convention against Transnational

Organised Crime, as well as its protocols on Trafficking in Persons and on Smuggling of

Migrants. The Criminal Procedure Code outlines investigative and criminal pursuit activities.

Moldova concluded a working arrangement with the European Union Agency for Law

Enforcement Training (CEPOL), an operational and strategic agreement with the European

Union's law enforcement Agency (Europol) and a Memorandum of Understanding with the

European Monitoring Centre for Drugs and Drug Addiction (EMCDDA). Moldova

participates in the European Multidisciplinary Platform Against Criminal Threats (EMPACT).

The country is a member of Interpol.

Anti-money laundering legislation partially reflects the Financial Action Task Force (FATF)

standards and relevant international legislation, but there are still outstanding

recommendations from MONEYVAL. Putting in place a comprehensive framework for the

fight against financial crime and money laundering, and ensuring its effective

implementation, are crucial to address the significant risks they pose.

Moldova is located at an important crossroads for smuggling of persons and illegal

goods(including drugs and arms) to the EU. Moldova is a source, transit and destination for

trafficking in human beings, in particular for sexual exploitation and forced labour, although

there have been few convictions of perpetrators. The General Police Inspectorate tackles

organised crime, however conviction rates for organised crime are not available. The

Inspectorate has one central and two regional departments (National Investigation

Inspectorates) responsible for the entire spectrum.

EUU, Alm.del - 2021-22 - Bilag 579: Kommissionens udtalelser vedr. Ukraines, Moldovas og Georgiens ansøgninger om EU-medlemskab

In many cases, further significant efforts to investigate wider organised crime networks are

needed.

1.4. Fundamental rights

International framework

Moldova has ratified the main international human rights instruments, including the Council

of Europe Convention on preventing and combating violence against women and domestic

violence (Istanbul Convention), the European Charter for Regional or Minority Languages,

the European Convention on the Exercise of Children’s Rights, and the European Convention

on Human Rights (although it has not ratified the Additional Protocol no. 12). The country

has ratified the UN Convention on the Rights of the Child and two of the Optional Protocols

but not the third (on a communications procedure), or the Optional Protocol to the UN

Convention on the Rights of Persons with Disabilities.

Legal and institutional setup

The legal and institutional framework regulating fundamental rights is in place and laws

generally follow European and international standards. The capacity of the institutions in

charge of protection and enforcement of human rights and the implementation of existing

strategies and action plans remains limited and impedes the effective enforcement of human

rights. In particular, the National Council to prevent discrimination and ensure equality is

seriously understaffed.

Moldova adopted a new Human Rights and Democracy Strategy for 2021-2024. Key

priorities are

gender equality/women’s rights, respect for human rights in the criminal justice

system, guaranteeing the integrity of electoral processes, and supporting independent media,

access to information, and the fight against disinformation.

The National Prevention Mechanism consists of seven members, including the

Ombudsperson, the Ombudsperson for children and five persons proposed by civil society.

The Ombudsperson institution

– the People’s Advocate

–

is designated as the National

Human Rights Institution and

accredited with “A” status by Global Alliance of National

Human Rights Institutions as largely complying with the Paris Principles. Its financial and

functional independence should be strengthened and its role

in the context of Moldova’s

Council for the Prevention of Torture clarified.

Key fundamental rights issues

The country has 18 judgements of the European Court of Human Rights under enhanced

supervision procedure pending their enforcement. These include ill-treatment by state agents,

illegal deprivation of liberty, violations of the right to a fair trial, authorities' failure to provide

protection from domestic violence and discrimination on grounds of sexual orientation.

More needs to be done concerning the

right to fair trial and the adequate investigation and

prosecutions of acts of ill treatment.

People deprived of their liberty do not enjoy all the

fundamental legal safeguards from the outset of their detention. The inadequate investigation

of alleged cases of ill-treatment leads to a sentiment of impunity. Conditions in places of

detention and pre-trial detention

remain below international standards, notably due to

overcrowding of prison facilities, lack of effective medical service or use of lengthy solitary

confinement as a disciplinary measure.

The legislation on access to information and

freedom of expression

is largely in line with

international standards, but more needs to be done to ensure the full implementation of the

EUU, Alm.del - 2021-22 - Bilag 579: Kommissionens udtalelser vedr. Ukraines, Moldovas og Georgiens ansøgninger om EU-medlemskab

law.

Media

can generally report freely. To guarantee media pluralism, the

concentration

media ownership and non-transparent media financing need to be tackled. Further efforts are

also needed to ensure access to information of public interest, safeguard the independence of

journalists and quality of media content (and disinformation), along with addressing the

increasing cases of verbal assault, intimidation and harassment of journalists.

The equality principle is enshrined in the Constitution. The Criminal Code guarantees

protection against

discrimination and hate crimes.

The Equality Council does not have an

adequate mandate within existing equality legislation. In April 2022, the parliament adopted

amendments to the Criminal Code and the Contravention Code to enhance

the state’s

response to hate crimes. Long-pending legislation on hate crime has been recently adopted

leading to a widening of the scope of protected grounds and thus to the strengthening of the

legal framework to prosecute and punish bias-motivated crimes. More needs to be done to

tackle hate speech and discrimination based on sexual orientation and gender identity, as well

gender-based violence.

Regarding

equality of women

in the labour market, the legal framework no longer prohibits

access to certain professions but women continue to face

de facto

obstacles and age-based

discrimination.

Moldova’s gender pay-gap

persists with women overall earning 14.1% less

than men on average in 2019 (the same as the EU average), and 39.6% of parliamentarians

elected in 2021 are women (above the EU average). More needs to be done to protect the

rights of lesbian, gay, bisexual, transgender, intersex or queer (LGBTIQ) persons. The law

prohibits employment discrimination based on sexual orientation, but societal discrimination

continues. The process of de-institutionalisation of

children

has much advanced over recent

years. More needs to be done regarding infant mortality, child labour, including links to

trafficking and sexual exploitation, and the particular situation of Roma children and children

left behind by their parents. The number of babies and children with disabilities in

institutional care facilities is a concern.

2. ECONOMIC CRITERIA

This assessment is made on the basis of the Copenhagen criteria related to the existence of a

functioning market economy, as well as the capacity to cope with the competitive pressure

and market forces within the Union.

2.1. Functioning market economy

Moldova is a small open economy with a Gross Domestic Product (GDP)

per capita

in terms

of purchasing power parity (PPP) of around 30% of the EU average in 2020, up from 25% in

2013. Overall, Moldova demonstrates a satisfactory track record in carrying out broadly

sound macroeconomic policies. However, the lack of political will and frequent changes of

government have sometimes made reform implementation uneven and delayed the

transformation into a competitive market economy.

During the last decade, Moldova has been able to sustain economic growth at about 4.5% per

year on average and weather several economic crises, including the pandemic. Public finances

have been stable, with a low deficit, at about 1.5% of GDP on average over 2013-2020, and a

sustainable debt level (about 32% of GDP in 2021, most of which is with International

Financial Institutions on concessional terms). This reflects Moldova’s efforts towards

increased fiscal policy consolidation and improved public finance management, fostered by

the 2013-2020 PFM Strategy.

EUU, Alm.del - 2021-22 - Bilag 579: Kommissionens udtalelser vedr. Ukraines, Moldovas og Georgiens ansøgninger om EU-medlemskab

Prior to the global inflationary pressures fuelled by Russia’s war of aggression against

neighbouring Ukraine, the National Bank of Moldova had been generally successful in

keeping inflation within the target range set at 5% (+/- 1.5 percentage points), while the

exchange rate regime of managed floating, supported a stable national currency. As a result of

rapidly growing energy and food prices, surging inflation, at 22% by the end of Q1 2022,

stands among the key challenges to Moldova’s

macroeconomic stability going forward, in

addition to the cost of housing and the high inflow of war refugees. On the external side,

imbalances have been relatively large, with the current account deficit at 7.3% of GDP on

average during the past ten years, owing largely to a substantial trade deficit. The latter has

been driven by strong domestic demand bolstered by large remittances, unfavourable terms of

trade and a relatively weak export base. However, thanks to substantial support from

international partners, Moldova was able to considerably build up its foreign exchange

buffers. Moldova is also traditionally heavily dependent on the inflow of remittances, with the

current war against Ukraine impacting negatively on revenues from Russia and the

Commonwealth of Independent States (CIS) region.

The current government has inherited a legacy of corruption, vested interests and weak

institutions responsible for rule of law, which hampers investment and productivity growth

and continues to undermine the business climate. The government has therefore launched a

reform of its justice system and is taking significant steps to tackle corruption, while ongoing

regulatory reforms aim to reduce red-tape.

Moldova’s State-Owned

Enterprises (SOEs) sector remains large, comprising of about 900

companies, and still requiring government support. State influence remains important in key

sectors of the economy, including in telecom, energy and transport. Overall, SOEs own assets

worth about 26% of GDP and employ around 6% of the active labour force. The sector

continues to suffer from a lack of adequate corporate governance practices, inefficiency and

poor oversight. This further undermines private sector investment and economy-wide

competitiveness and poses fiscal risks. Further reforms, especially, concerning better

corporate governance, reorganisation, privatisation and liquidation of non-viable companies

are needed and among the government priorities. In addition, informal sector remains

relatively large, accounting for an estimated 27% of GDP in 2020. High levels of informality

partly result from a heavy regulatory burden and imply not only substantial losses of budget

revenues but also lower productivity.

Moldova’s financial sector has undergone significant reforms,

especially following a major

bank fraud in 2014, amounting to the equivalent of 12% of GDP. Since then, the key systemic

banks have been restructured, with the majority of shares sold to transparent international

shareholders. At present, the banking sector seems well capitalised, with all banks meeting the

capital adequacy ratio, and a substantial fall in the share of non-performing loans in recent

years. Thanks to successful banking sector reforms, access to finance, in particular for small

and medium sized enterprises (SMEs), has improved recently. However, financial

intermediation remains low, with the share of loans extended to the private sector at 20% of

GDP on average between 2017 and 2021. In addition, overall progress on the recovery of the

stolen assets and legal proceedings as regards the 2014 bank fraud have been slow and non-

transparent.

The labour market features significant structural weaknesses, as reflected by the very low

employment rate of around 49% in 2020. This is partly due to the substantial share of

informal employment, in particular in the agricultural sector and construction. There is also a

mismatch between skills and job requirements. Although unemployment among university

graduates remains, on average, lower than for those with only a secondary education degree,

EUU, Alm.del - 2021-22 - Bilag 579: Kommissionens udtalelser vedr. Ukraines, Moldovas og Georgiens ansøgninger om EU-medlemskab

some graduates continue to struggle with finding jobs matching their qualifications.

Employment services and labour market programmes are hampered by limited funding, while

the creation of good quality jobs is held back by insufficient private and foreign investment in

higher value-added sectors.

2.2. Ability to cope with the competitive pressure and market forces of the EU

Moldova suffers from low skills level and match due to the low quality of education and a

significant emigration of qualified workers. Although investment in education, has been

relatively high at 5.7% of GDP during 2019-2022, Moldova scores below the OECD average

according to the PISA results, ranking 51

out of 78 countries. Yet, it is still relatively better

than other countries in the region, and with progress noted over the years. Vocational training

has improved, with a new form of dual education being currently implemented to bridge the

gap between education institutions and the private sector.

Moldova’s physical infrastructure remains relatively underdeveloped, despite important

support from international partners and significant investment by the government, albeit from

a low starting point. Gross fixed capital formation accelerated in recent years and amounted to

around 25% of GDP in 2020. At the same time, the total stock of FDI is low at about 25% of

GDP, reflecting weaknesses in the business environment and continuing problems with

corruption and property rights. The energy sector suffers from key structural weaknesses,

uncovered following the gas crisis that began in October 2021. Moldova is fully dependent on

the supply of gas from Russia and has no storage capacity on its territory, making it extremely

vulnerable vis-à-vis the supplier. The electricity market suffers from similar issues, with little

diversification of energy resources and underdeveloped infrastructure. Unbundling the energy

utilities is therefore among the key priorities in the future, and Moldova is working closely

with the EU to that effect.

The Moldovan economy is not very diversified and remains heavily reliant on the agricultural

sector, which makes it less productive and particularly vulnerable to climate conditions.

Agriculture

accounts for about 12% of Moldova’s official GDP (according to 2021 data) and

the informal subsistence agriculture represents another estimated 11% of GDP. The

manufacturing sector remains relatively weak, with its share of GDP decreasing from 15.4%

in 2016 to 12.4% in 2021. However, the IT sector has seen a noticeable expansion, especially

since the pandemic, albeit starting from a low level and this is reflected in its growing

contribution to GDP growth. Moldova’s alignment with the EU electronic communication

legal framework is limited.

Moldova’s economy is closely integrated with that of the EU. Economic links between the

two have been further strengthened since the entry into force of the DCFTA. The EU is

Moldova’s biggest trading partner, accounting for

a share of about 66% of its total exports,

well above its regional peers, and around 45% of its total imports in 2021. Food and

agricultural products and other commodities make up for almost half of Moldova’s exports,

pointing to its feeble export structure and need to move up the global value chains. Moldova

is a WTO member since 2001, with a largely open trade policy.

3. ABILITY TO ASSUME THE OBLIGATIONS OF MEMBERSHIP

The ability of Moldova to assume the obligations of membership has been evaluated based on

the following indicators:

EUU, Alm.del - 2021-22 - Bilag 579: Kommissionens udtalelser vedr. Ukraines, Moldovas og Georgiens ansøgninger om EU-medlemskab

The commitments in the Association Agreement including the Deep and

Comprehensive Free Trade Area (AA/DCFTA) and their implementation;

The level of adoption, implementation and enforcement of the

acquis

outside the

AA/DCFTA.

The EU-Moldova Association Agreement, including the Deep and Comprehensive Free Trade

Area (AA/DCFTA) belongs to a new generation of ambitious association agreements the EU

has concluded with its partner countries. The Agreement captures a substantial part of the EU

acquis

with a detailed timetable of implementation varying from 3 to 7 years and brings the

country closer to the European Union in terms of regulatory alignment.

Since the provisional entry into force of the AA/DCFTA in 2014, EU Member States are

closely involved in its implementation through the Association Council and the Association

Committee. Common Positions are adopted for the Association Council and a detailed

Annotated Agenda is agreed for the Association Committee. Strategic guidance is provided

by the Association Council meetings at the highest political level. Furthermore, the EU-

Moldova Parliamentary Association Committee involves the European Parliament and the

Moldovan Parliament in the implementation of the agreement. The discussions are informed

by the input provided by the civil society through the EU

–

Moldova Civil Society Platform

and duly taken into account.

The institutional setup includes Association Committee and Association Committee in Trade

Configuration, dedicated Sub-Committees and Cluster Sub-Committees covering almost all

chapters of the EU

acquis

that allows for ongoing and thorough analysis of the progress in the

relationship. The EU and Moldova have worked closely together to identify key policy areas,

set targets for reform and legislative progress, and benchmark achievements in those areas.

The regularly updated Association Agendas set out the short and medium term policy

objectives of EU-Moldova cooperation.

Moldova’s implementation of the EU

acquis

is documented in the EU’s ‘Association

Implementation Reports’

issued regularly since 2017. A full examination of all EU

acquis

chapters will be carried out at a later stage.

Following the adoption of the revised enlargement methodology

and for the purpose of the

EU’s Enlargement policy, the EU

acquis

is structured around six thematic clusters. The EU

acquis

in these clusters is substantially covered by the AA/DFCTA and Moldova has

gradually approximated with it. Moldova has a satisfactory track record of implementation,

though progress is uneven and delays in meeting the ambitious times lines in the AA/DCFTA

have been frequent. Pending the full examination of all chapters, the below analysis provides

examples of chapters in the clusters where Moldova has achieved particularly good results

and highlights areas where there has been limited approximation to the EU

acquis.

The

Fundamentals cluster

includes the chapters of the

acquis

Judiciary & fundamental

rights, Justice, freedom and security, Public procurement, Statistics, and Financial control.

This cluster has already been assessed under the Political and Economic criteria sections.

There are areas in the cluster where approximation to the EU

acquis

is still limited, for

example in

Judiciary and fundamental rights

and

Justice, freedom and security.

SWD(2021) 295 final

COM (2020) 57 final.

EUU, Alm.del - 2021-22 - Bilag 579: Kommissionens udtalelser vedr. Ukraines, Moldovas og Georgiens ansøgninger om EU-medlemskab

The

Internal market cluster

includes the chapters of the

acquis

Free movement of goods,

Free movement for workers, Right of establishment and freedom to provide services, Free

movement of capital, Company law, Intellectual property law, Competition policy, Financial

services, and Consumer and health protection.

Moldova has achieved particularly good

results in the

free movement of goods

where it has made substantial efforts to align with EU

standards, to remove technical barriers to trade.

There are other areas in the cluster where approximation to the EU

acquis

is still limited, for

example, the area on

Competition Policy.

The AA/DCFTA sets ambitious goals in the domain

of State aid and competition. Moldova’s competition and State aid legislation is largely based

on the EU

acquis

on antitrust and mergers. There is a need to further strengthen effective

mechanisms of market monitoring, surveillance and enforcement.

The

Competitiveness and inclusive growth cluster

includes the chapters of the

acquis

Information society and media, Taxation, Economic and monetary policy, Social policy and

employment, Enterprise and industrial policy, Science and research, Education and culture,

and Customs union.

Moldova has achieved particularly good results in the area of

customs,

with new legislation to counter smuggling and import tax evasion, and to increase customs

investigations and agreed with the EU a Mutual Recognition of Authorised Economic

Operators programmes. The new Customs Code that will enter into force in 2023 is aligned

with the Union Customs Code, with a few exceptions.

Moldova’s association to Horizon

Europe is a successful instrument for integration with the EU’s practices in the field of

research and innovation.

There are other areas in the cluster where approximation to the EU

acquis

is still limited, for

example in

social policy and employment.

The

Green agenda and sustainable connectivity cluster

includes the chapters of the

acquis

Transport policy, Energy, Trans-European networks, and Environment and climate

change.

Moldova achieved particularly good results in the area of

TEN-T networks.

The TEN-

T network was extended to Moldova in 2019 with the identification of 17 priority projects

with an investment of EUR 917 million. Over 62% of the priority kilometres in rail and road

connections have been completed or are underway. The Common Aviation Area Agreement

signed in 2013 integrates the Moldovan and EU aviation markets, while providing for

progressive alignment with the relevant EU

acquis.

Although some preparatory work has been done, significant efforts are needed, coupled with

political and financial support, to align Moldovan legislation with the EU

acquis

in the field

Environment and climate action.

Meaningful reforms will be needed in view of European

Green Deal

targets. There are other areas where approximation with the EU

acquis

is still

limited such as

Energy.

Moldova’s membership of the Energy Community supports the

adoption of the reforms needed in the energy market, with unbundling, and certification of

electricity and gas transmission system operators the main priorities. The Strategic high level

dialogue with Moldova on energy, launched in 2021, has helped to accelerate the

transformation of Moldova’s energy network and secure short-term

security of supply by

diversifying energy sources in line with the REPowerEU Plan. The dialogue provides a

platform to enhance the implementation of the EU

acquis

towards green transition and

climate-neutrality. It also enables coverage of more recent EU

acquis

not included in the

Association Agreement as well as governance and financial aspects needed for their

implementation.

COM(2019) 640 final

EUU, Alm.del - 2021-22 - Bilag 579: Kommissionens udtalelser vedr. Ukraines, Moldovas og Georgiens ansøgninger om EU-medlemskab

The cluster

Resources, agriculture and cohesion

includes the chapters of the

acquis

Agriculture and rural development, Food safety, veterinary and phytosanitary policy,

Fisheries, Regional policy and coordination of structural instruments, and Financial and

budgetary provisions.

Moldova achieved particularly good results in the area of

Agriculture

and rural development

where it has implemented a substantial part of the EU

acquis

in the

areas of quality policy, organic farming, marketing standards, products, fruits and vegetables,

marketing standards for animal products. The country has started to implement some key

mechanisms for

regional policy.

The approximation to the

acquis

in the area of

Food safety, veterinary and phytosanitary

policy

is limited.

The cluster

External relations

includes

External relations and Foreign, security and defence

policy.

As regards the

EU Common Foreign and Security Policy positions,

the alignment

rate with relevant High Representative statements on behalf of the EU and Council Decisions

was 62% in 2021 (2020: 68%; 2019: 80%; 2018: 72%, 2017: 69%). A high level political and

security dialogue with Moldova was launched in March 2022 to complement the regular

exchanges under the Association Council and further promote gradual convergence on foreign

and security matters. Moldova contributes to

Common Security and Defence Policy

missions, with one military staff representative seconded to the EU Military Training Mission

in Mali since September 2020. There is scope to further enhance cooperation in the area of

Common Security and Defence Policy and to increase Moldova’s convergence with Common

Foreign and Security Policy including on all EU positions.

4. CONCLUSIONS AND RECOMMENDATIONS

Moldova is a parliamentary democracy that has recently embarked on a strong reform agenda

despite a series of exogenous crises. The parliamentary nature of the democracy has been

confirmed by recent competitive elections at parliamentary and presidential level. The

country’s legal and constitutional framework largely

corresponds to European and

international standards. The framework for a modern public administration is established

including policy development and coordination mechanisms and the government has made

progress on Public Financial Management. Adequate institutional and public administrative

capacity needs to be ensured for policy development, enforcement of legislation and policy

implementation. After the 2014 banking fraud, Moldova has undertaken a major overhaul of

its justice and anticorruption systems. On justice reform, the country took decisive steps

including constitutional reforms to improve the functioning of the judiciary, which still

requires improvements on its transparency, integrity and accountability. Similarly, on the

fight against corruption which remains a serious concern, specialised anti-corruption

institutions are in place with further efforts needed to bring corruption cases to courts and to

prosecute them efficiently. The framework for fundamental rights and freedom of expression

generally follows European and international standards. Moldova has made important

progress in freedom of the media, despite its media concentration and opaque financing.

Further efforts are needed to ensure access to information of public interest and safeguard the

independence of journalists. Overall, as regards the

political criteria,

Moldova has a solid

foundation in place to reach the stability of institutions guaranteeing democracy, the rule of

law, human rights and respect for and protection of minorities.

EUU, Alm.del - 2021-22 - Bilag 579: Kommissionens udtalelser vedr. Ukraines, Moldovas og Georgiens ansøgninger om EU-medlemskab

As regards the

economic criteria,

Moldova has pursued reasonably sound macroeconomic

policies, significantly strengthened financial sector stability, and improved the business

environment. Moldova needs to address inefficiencies to attract more foreign private

investment and enhance public and private investments in strategic infrastructure, education

and innovation. Key areas for improving the functioning of its market economy also include

reducing corruption and pursuing justice reforms, the enforcement of property rights, further

development of a more dynamic business environment as well as better corporate reform of

the governance of state-owned enterprises sector with a view to reducing its size. Similarly,

improvements are needed in energy security to reduce the energy intensity of the economy

and society. Furthermore the country’s capacity to cope with the competitive pressure in the

EU will depend on a more robust and diversified job market and the reduction of the labour

force drain, improving

Moldova’s growth potential and external competitiveness.

As regards

the capacity to fulfil the obligations of membership,

Moldova has worked since

2016 on the implementation of the EU-Moldova Association Agreement, including a Deep

and Comprehensive Free Trade Area (AA/DFCTA). These agreements already capture

significant amount of the EU

acquis

and Moldova has gradually taken up the alignment

process across many chapters and has a satisfactory track record of implementation, while in

some sectors the process is more advanced than in others. Overall, Moldova has established a

solid basis for further alignment.

Moldova is a European State committed to respecting and promoting the values on which the

European Union is founded. The Commission therefore recommends to the Council that

Moldova should be given

the perspective to become a member

of the European Union.

The Commission recommends that Moldova be granted

candidate status,

on the

understanding that the following steps are taken:

complete essential steps of the recently launched comprehensive justice system reform

across all institutions in the justice and prosecution chains, to ensure their

independence, integrity, efficiency, accountability and transparency, including through

efficient use of asset verification and effective democratic oversight; in particular, fill

all the remaining vacancies of the Supreme Council Magistracy and in its specialised

bodies;

across all these areas, address shortcomings identified by OSCE/ODIHR and the

Council of Europe/the Venice Commission;

deliver on the commitment to fight corruption at all levels by taking decisive steps

towards proactive and efficient investigations, and a credible track record of

prosecutions and convictions; substantially increase the take up of the

recommendations of the National Anticorruption Centre;

implement the commitment to

“de-oligarchisation”

by eliminating the excessive

influence of vested interests in economic, political, and public life;

EUU, Alm.del - 2021-22 - Bilag 579: Kommissionens udtalelser vedr. Ukraines, Moldovas og Georgiens ansøgninger om EU-medlemskab

strengthen the fight against organised crime, based on detailed threat assessments,

increased cooperation with regional, EU and international partners and better

coordination of law enforcement agencies; in particular, put in place a legislative

package on asset recovery and a comprehensive framework for the fight against

financial crime and money laundering, ensuring that anti-money laundering legislation

is in compliance with the standards of the Financial Action Task Force (FATF);

increase the capacity to deliver on reforms and provide quality public services

including through stepping up implementation of public administration reform; assess

and update the public administration reform strategy;

complete the reform of Public Financial Management including improving public

procurement at all levels of government;

enhance the involvement of civil society in decision-making processes at all levels.

strengthen the protection of human rights, particularly of vulnerable groups, and

sustain its commitments to enhance gender equality and fight violence against women;

The Commission will

monitor Moldova’s progress in fulfilling these

steps and report on them,

together with a

detailed assessment

of the country, by the end of 2022.

The accession process remains based on

established criteria and conditions.

This allows

any country in the process to progress based on own merits but also means that steps towards

the EU can be reversed if the underlying conditions are not met anymore.