Warning issued over Montenegro-UAE agreement potentially threatening EU membership prospects
New UAE-Montenegro Cooperation Agreement Sparks Transparency Concerns
Published on 30th May 2025
Transparency International, a global anti-corruption watchdog, has voiced concerns over a recently approved bilateral agreement between Montenegro and the United Arab Emirates (UAE). The Agreement on Cooperation in Tourism and Real Estate Development, following parliamentary approval, aims to boost foreign investment. However, Transparency International argues that some provisions could violate EU standards, specifically in relation to Chapter 5 of the accession negotiations, which focuses on public procurement.
Controversial Exemptions
One of the primary sources of contention is Article 2.4 of the agreement, which exempts contracts and future arrangements with UAE investors from public procurement, tender, and competition laws in both countries. Transparency International views this as a potential breach of EU regulations, as it allows contracts to be awarded without undergoing competitive bidding processes - a practice at odds with both EU public procurement rules and Montenegro's Stabilisation and Association Agreement (SAA) with the European Union. The European Commission also expressed reservations, stating that such provisions might contravene principles of transparency and fair competition crucial to the EU internal market.
Impact on EU Accession
Since 2012, Montenegro has been engaged in EU accession negotiations and has made significant strides in aligning its procurement framework with EU standards. The European Commission's 2024 progress report acknowledged enhancements in Montenegro's electronic procurement system and rated the country as moderately-to-well prepared in this area. Nonetheless, the ratification of the UAE agreement risks impeding these advancements, potentially stalling progress under Chapter 5. This, in turn, could jeopardize broader accession efforts.
Absence of Anti-Corruption Measures
The agreement has also been criticized for its lack of anti-corruption safeguards. Public procurement is recognized as a high-risk area for corruption; any deviation from standard procedures could foster cronyism and misuse of public resources. Without effective oversight mechanisms, Transparency International contends that the agreement undermines principles of good governance and accountability, key benchmarks in the EU accession process.
Recommendations from Transparency International
In light of these concerns, Transparency International has called on the Montenegrin Parliament to reconsider the agreement and ensure its compliance with the country's constitutional and EU obligations. The organization also urges the government to carry out a thorough review of the agreement's provisions, amending them where necessary to uphold transparency and competition.
Additionally, Transparency International suggests a comprehensive public consultation process, involving legal experts, civil society organizations, and EU representatives, to assess the agreement's implications. The organization advocates for full alignment with EU procurement standards, including revisions to guarantee compliance with the SAA. Lastly, it encourages the European Commission to closely monitor the agreement's implementation and assess its potential impact on Montenegro's accession trajectory.
In the 2024 Corruption Perception Index, the UAE achieved a score of 68 out of 100, placing it 23rd out of 180 countries, while Montenegro ranked 65th with a score of 46 out of 100, signifying a moderate level of corruption. For reference, the UK scored 71, France 67, and Armenia 47.
[1] Enshrined in Council Regulation (EC) No 1/2004 of 16 December 2003 on the application of the Community's accession agreements with the countries of the former Yugoslavia - Official Journal of the European Union No L 1/1.[2] Available at: https://ec.europa.eu/info/law/better-regulation/have-your-say/initiatives/12666-Public-procurement-in-Negotiations-for-Montenegro-accession-to-the-EU[3] Transparency International’s Multi-Year Evaluation of EU Support to Anti-Corruption and Rule of Law, Page 16-17[4] D. Agnew, I. Damjanovic, and M. Pesina, “Implementing EU Law in Montenegro: The Influence of Political Institutions and the Rule of Law Agenda”, Journal of Comparative Policy Analysis: Research and Practice, 2018.[5] European Commission Progress Report 2024, Chapter 3 – Justice, Freedom and Security, Section 3.2 Rule of Law.
The agreement between Montenegro and the UAE, particularly Article 2.4, exempting UAE investors from public procurement, tender, and competition laws, may breach EU regulations due to potential violations of public procurement rules and Montenegro's Stabilisation and Association Agreement with the European Union. Transparency International recommends the Montenegrin government to ensure the agreement's compliance with EU obligations, amend provisions as necessary for transparency and competition, and carry out a public consultation process before seeking ratification, in order to align with EU procurement standards.
