Commission Report (2002): Poland

C. Conclusion

In its 1997 Opinion, the Commission concluded that Poland fulfilled the political criteria. Since that time, the country has made considerable progress in further consolidating and deepening the stability of its institutions guaranteeing democracy, the rule of law, human rights and respect for and protection of minorities. This has been confirmed over the past year. Poland continues to fulfil the Copenhagen political criteria.

The reinforcement of administrative capacity across the civil service is an important issue, recent developments have been mixed and further efforts are needed. In the area of public administration progress in the implementation of the 1999 Civil Service Law has been limited by the temporary suspension of the system of recruitment by open competition. It is essential that the pace of implementation, most notably with respect to recruitment, is accelerated so as to ensure that an independent, well trained and motivated civil service is in place by the time of accession.

Poland has made further progress in reforming the judiciary and in creating conditions to allow for a reduction in the most pressing bottlenecks. Efforts should now focus on ensuring that the progress to date delivers the desired result in terms of improved efficacy of the judiciary. Issues relating to judicial immunity are being addressed and should be followed up. Similar priority needs to be given to the training of judges, in particular in EC Law. While there have been ongoing efforts a sustainable structured programme of training needs to be put in place.

Corruption remains a cause for serious concern, a comprehensive strategy has been adopted to combat the problem. Substantial efforts are required to ensure concrete results, which to date have been limited, and in particular to develop a political, administrative and business culture which can resist corruption.

Poland continues to respect human rights and freedoms.

The 1997 Opinion already acknowledged the comprehensive reform efforts undertaken by the Polish authorities to transform their economy. Since the Opinion, and against a challenging international economic environment, economic performance has improved. Macroeconomic stability has been achieved, reforms have continued while the Polish authorities' commitment to the economic requirements of EU accession has been sustained.

Hence, it is concluded that Poland is a functioning market economy. The continuation of its current reform path should enable Poland to cope with competitive pressure and market forces within the Union.

Improvements can be made to fiscal policy through the implementation of the government's new expenditure norm at all levels of government as part of a more broadly based structural reform of public finances to support fiscal consolidation. Furthermore, restructuring and privatisation, mainly in heavy industry, the financial sector, energy distribution and agriculture, needs to be completed. In addition, bankruptcy procedures and the land registry call for further improvement. Finally, central bank independence must be preserved to ensure macroeconomic stability and investor confidence.

Since the Opinion, Poland's progress has been characterised by a slow start and a subsequent acceleration in respect of the adoption of legislation. As a consequence the vast majority of primary acquis is now in place, although in some sectors there are considerable gaps in the necessary implementing legislation, for example, in the veterinary, environment and food safety areas. There has been a knock on effect in terms of administrative capacity which has progressed since the Opinion, but not to the same extent as legislative alignment.

Over the past year, Poland has further advanced its alignment of primary legislation, notably in the areas of transport and free movement of persons. The performance in adopting implementing legislation has varied considerably between sectors. The development of administrative capacity has mirrored the progress of implementing legislation.

Overall, Poland has achieved a high degree of alignment with the acquis in many areas, and is well advanced with reaching adequate administrative capacity to implement the acquis in a number of fields, although further efforts remain to be made across the board with respect to administrative capacity, and in a number of sectors in particular with regard to alignment with the acquis. Detailed plans have been agreed, in particular in the negotiations and in the Action Plan, to cover the remaining gaps.

With regard to the internal market, in the area of free movement of goods considerable progress has been made over the last two to three years, notably by putting in place the framework legislation needed and by developing further the institutional infrastructure needed for its implementation. To date a high level of alignment has been achieved in relation to the primary legislation and administrative capacity has reached a reasonable level. Legislative developments in the area of market surveillance need to be built on through the development of the necessary administrative capacity. The area of food safety has not seen the progress in the adoption of implementing legislation identified as necessary in the last Regular Report and administrative capacity remains weak. Further work is also required to ensure the structures are in place to implement the public procurement acquis. In overall terms, a high level of alignment with the acquis has been achieved and a strong administrative capacity developed in the area of free movement of persons. In the field of free movement of services, there is generally a good level of alignment and sound administrative capacity. However, further efforts are required in aligning existing legislation concerning banking, insurance and securities. A course of action to resolve these difficulties has been agreed. Following the peer gropu review, Poland has produced an action plan but several problems such as discriminatory language requirements, problems with administrative structures and ensuring independent supervisory structures remain. Poland's track record in the free movement of capital has been one of steady progress, both in aligning its legislation and in developing the necessary administrative structures. Poland has to a large extent achieved alignment with the acquis in the area of company law, and gradual progress has been made with strengthening administrative capacity which has achieved a reasonable level, with the exception of intellectual property enforcement. Building up administrative capacity is essential if effective implementation is to be ensured. In the field of competition, legislative alignment is largely complete, although there remain some gaps on State aid, and efforts have focused on establishing a credible record of enforcement in the area of State aid. These efforts will need to be continued and intensified, with a specific and urgent focus on the restructuring of the steel sector where aid can only be given if an acceptable overall restructuring programme including necessary measures for reaching viability and necessary cuts in production capacity is reached.

In the telecommunications area, Poland has made steady progress since the Opinion in aligning with the acquis and liberalising its market. Implementation of the existing legislation has improved over the last year; further legislative alignment is awaited, as is the evaluation of the economic implications of full implementation of the universal service acquis.

With regard to EMU, alignment is almost complete, however the legislative amendment necessary to ensure the degree of independence of the National Bank as set out in the acquis remains to be undertaken.

There has been further progress in aligning rates of indirect taxation. In overall terms, Poland has achieved a reasonable level of alignment with the acquis and moderate development of the necessary implementing capacity. Significant further work is required to ensure that the systems are in place to allow for the exchange of computerised data between the EC and Poland by the date of accession. In the customs area the situation is similar, with a respectable record on alignment but a weaker one on administrative capacity. The establishment of the necessary information technology infrastructure will require considerable further effort if the intended deadlines are to be respected. This will require an approach which gives urgent attention to accelerating the work on computerisation and interconnectivity and overcoming the disruption caused by the reorganisation of the central customs service. Steps have been taken to secure the necessary funding but this matter will need to be kept under close scrutiny and the Commission intends to report on progress at the end of the first half of 2003. Efforts should also focus on completing the alignment of Poland's customs legislation on that of the Community, in particular by adopting the amendment to the customs code which is currently under preparation.

Further transformation is needed, in terms of policy, legislation and structures in the agriculture sector, where the overall situation in terms of legislative alignment and in particular administrative capacity has been weak. There has been some progress with regard to primary legislation. In the veterinary sector the good work of the previous year has not been built on and requires urgent attention. There have been some efforts to address the considerable weaknesses in administrative capacity. However these will need to be intensified, in particular at the regional level, if they are to have any significant impact. Considerable further efforts are needed in upgrading establishments and ensuring that adequate inspection arrangements at the borders are in place. The Integrated Administration and Control System (IACS) in particular must be in place, if Poland is to be in a position to effectively administer and control the CAP support schemes. This has been acknowledged through the efforts which the Polish authorities are undertaking. These need to be substantially stepped up.

In the fisheries sector, there has been a moderate degree of alignment. Some further legislative progress has occurred and there have been efforts to reinforce the administrative capacity at the central level, although the capacity at the regional level continues to be weak. Greater effort needs to be put into meeting the objectives set out in the Action Plan.

In the social field, the degree of alignment varies considerably between sectors. The capacity to implement the acquis has received some attention but this needs to be intensified. Additional efforts continue to be required, in particular to further align and implement the EC labour law and the acquis on occupational health and safety. Adoption of the pending legislation would do much to further alignment in this area. There have been further developments with regard to legislation in the area of regional policy. Specific attention is required to carry through in a timely manner the implementation plans and further reinforce the administrative capacity including strengthening inter-ministerial co-operation and partnership. To this end the objectives set out in the Action Plan should be realised as soon as possible. Particular attention needs to be paid to the technical preparation of projects eligible for Community funding. Existing implementation and administrative capacity plans, including the increase of personnel in the managing and paying authorities, should be implemented with due vigour.

In the area of environment, further progress has been made in terms of primary legislation, where there is a high level of alignment. The adoption and implementation of the necessary implementing legislation, and the accompanying administrative capacity, especially at the regional level, is required; given the limited strength of administrative capacity the implementation of the objectives set out in the Action Plan should be one focus of attention. Ensuring adequate investment, as set out in the environmental investment plans, is also essential.

The energy sector has a good level of alignment and the administrative capacity is adequate. Work to further align the existing legislation with the acquis is required, in particular on the internal energy market (notably gas). In the transport sector there is also a good level of alignment. The focus of attention should now be on putting in place the necessary implementing legislation and strengthening the administrative capacity to implement this legislation. The Action Plan sets out a range of objectives in this respect.

There has been further progress in justice and home affairs, especially with regard to the border guards and border management. There has been a continuation of efforts to improve the situation with regard to law enforcement bodies dealing with the fight against organised crime and drugs, in particular the police services. These need to be intensified and adequate resources, financial as well as human, allocated to implement the Schengen Action Plan and other strategies so as to ensure that the necessary administrative capacity is in place to implement the acquis. In overall terms alignment with the acquis is good but administrative capacity has not progressed to the same extent.

Further legislative progress has been noted in terms of internal financial control where there is now a reasonable level of alignment with the acquis. The challenge continues to be to put in place the necessary control mechanisms by completing alignment (PIFC and protection of EC financial interests), by completing and strengthening the required institutional structure, and by moving forward substantially on the management of preaccession funding and the establishment of the necessary structures and adequate administrative capacity for the implementation of the future structural funds, in particular regarding internal financial control. This will require the full and vigorous implementation of the Action Plan.

There continues to be some disparity between progress in the adoption of legislation and the reinforcement of administrative capacity. Continued efforts are needed to set up or strengthen administrative capacities across the board, notably on market surveillance, agriculture and food safety, fisheries and regional policy, the social field, environment, customs and justice and home affairs. Particularly close attention is required regarding the structures necessary to implement those parts of the acquis which will become applicable only from the date of accession, with a special focus on those parts which are essential for the sound and efficient management of EC funds.

In the accession negotiations, 27 chapters have been provisionally closed. Poland is generally meeting its commitments made in the negotiations. However, delays have occurred in the areas of agriculture (implementation of the animal identification and registration system), fisheries (adoption of legislation related to resource management, inspection and control, and in the area of market policy), environment (adoption of implementing legislation with regard to water quality, industrial pollution control and risk management, and chemicals). These issues need to be addressed.

Bearing in mind the progress achieved since the Opinion, the level of alignment and administrative capacity that Poland has achieved at this point in time, and its track record in implementing the commitments it has made in the negotiations, the Commission considers that Poland will be able to assume the obligations of membership in accordance with the envisaged timeframe. In the period leading up to accession, Poland needs to continue its preparations in line with the commitments it has made in the accession negotiations.

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