In the light of various comments made in Bosnia and Herzegovina (BiH) media about ongoing discussions between BiH and the European Union about adaptation of the SAA after the accession of Croatia, the EUD/EUSR would like to clarify a number of relevant points.

First, the adaptation of the trade part of the Stabilisation and Association Agreement (and its Interim Agreement) between the EU and BiH, which is still pending following Croatia’s accession to the EU, is not a bilateral exercise between Bosnia and Herzegovina and Croatia, but a matter between Bosnia and Herzegovina and all 28 EU Member States.

Second, the EU is not requiring from BiH to award Croatia with the same benefits that it had under CEFTA rules. For example, Croatia no longer benefits from the fully liberalised trade arrangements (without any quotas) that it had with its former CEFTA partners; its access to their markets is now regulated by the less liberal bilateral trade agreements (SAAs) which the EU has with each individual CEFTA member. These agreements are quota based.

The EU’s methodology in this matter consists, in principle, of a purely technical/mathematical adaptation of the quotas in the SAA/Interim Agreement in order to take into account, in the overall EU-BiH trade relationship, the traditional preferential trade that existed between BiH with Croatia under CEFTA rules. The aim is to have the least disruption possible to trade patterns, although in a few cases it can also lead to the establishment of new quotas.

For example: if BiH had granted an annual quota of 1,000 tonnes of a product for duty free imports from the EU, and duty free imports from Croatia under CEFTA rules amounted to 100 tonnes, the new (adapted) quota for duty free imports from the enlarged EU (28 instead of 27 Member States) amounts  to 1,100 tonnes. It is important to note that such quotas are awarded on a first come, first served basis and the new quota could therefore in principle benefit any EU Member State – not necessarily Croatia.

We strongly emphasise that this adaptation works both ways with increases of quotas on both sides, and therefore allegations of unfairness towards BiH are misplaced. For example, if for a given product the EU had granted an annual quota of 10,000 hl for duty free imports from BiH into the EU and BiH exported on average 20,000 hl duty free under CEFTA rules to Croatia, the new (adapted) quota for duty free imports from BiH to the EU will be increased to 30,000 hl.  

The EU methodology of SAA adaptation based on traditional trade has been accepted by all Western Balkans countries, with the exception of BiH. The European Commission has taken steps to suspend BiH from certain trade benefits if the adaptation process is not finalised by the end of 2015.