CAP objectives can be achieved through two pillars. The first pillar is related to direct payments and common market organization, and the second pillar is related to rural development policy. The biggest part of Budget for this area is intended for Direct payments, and their main purpose is to support agricultural holdings and to ensure the stability of the common market with uniform conditions for placing agricultural products on the Union market. Rural development policy, through the support of economic activities in rural areas, aims to improve the quality of life, both economically and socially. The first pillar measures are integrally financed from the common budget of the European Union and the funds are paid to farmers in full (except for certain measures within the common market organization), while the second pillar is subject to the principle of co-financing from national budgets. The EU acquis in the field of agriculture also includes organic production and quality policy.

Numerous requirements must be met for the proper implementation of the CAP. For the first pillar, it is required to establish the necessary infrastructure, strengthen the existing ones and establish new administrative structures such as: a functional Paying Agency that will receive and verify requests, make payments, enable the proper submission of documents in the form required by the EU, to keep records of payments and on the performed controls. Likewise, it is necessary to establish the Integrated Administration and Control System (IACS) which is a computerized database, a system of identification of agricultural parcels, a system for identifying and registering animals as well as farm registers. In addition, it is necessary to establish the Farm Accountancy Data Network (FADN) as the body responsible for selecting farmsfrom which data is collectedas well as Producer organizations that are formedon the initiative of producers and which are acting in accordance with EU regulations and the administration for the effective implementation of EU regulations.

For the second pillar, it is necessary to have an effective administration that will ensure the enforcement of the rules in the process of the implementation of rural development measures, as well as an assessment of the effectiveness and quality of the implementation of rural development policy. In addition, it is necessary to provide the identification of needs of rural areas, production, implementationand management of programs, monitoring, reporting, control and evaluation of programs and measures within them.

In order to fulfill above mentioned, the administration must be aligned with EU requirements, and the involvement of regional and local authorities and all other partners must be ensured.

During the negotiations, the state is preparing for the effective implementation of the CAP, which aims to ensure a stable supply of quality, safe food for the population at affordable prices and adequate incomes for farmers, thus encouraging the modernization and development of agricultural production. After joining the EU, prices of agricultural products will be equalized with prices in the EU, and producers will become beneficiaries of the EU subsidies.

In order to carry out these functions, the administration must fulfill the EU regulations and to ensure the involvement of regional and local authorities, as well as all social partners.

When was the chapter opened?

Negotiating Chapter 11 – Agriculture and Rural Development has been opened at the Intergovernmental Conference held on 13 December 2016 in Brussels.

Opening benchmarks?

In this chapter, Montenegro had one opening benchmark related to the development of a comprehensive National strategy on agriculture and rural development with an Action Plan that serves as the basis for the transposition, implementation and enforcement of the acquis. The Action Plan includes, inter alia, the development of a system of identification of agricultural parcels and a unique identification system for farmers in order to prepare for the management and control of agricultural payments.

On 25 June 2015, the Government of Montenegro adopted a National Strategy for the Development of Agriculture and Rural Areas, including the Action Plan for Harmonization with the Acquis and thereby fulfilled the opening benchmark.

Closing benchmarks?

In the framework of Chapter 11- Agriculture and rural development Montenegro has obligations to meet following closing benchmarks:

1. Montenegro presents an implementation plan for the establishment of an Integrated Administration and Control System (IACS) to be fully operational by the date of accession. The Plan has to cover all actions required for the full implementation of each separate component of the system and their integration, including a presentation of the current status of preparation, the future targets indicated in a timetable, a plan of legislation still to be adopted, precise budgetary and human resources requirements and identification of possible shortcomings and respective solutions. Montenegro demonstrates sufficient progress towards the setting-up of the IACS, including the establishment of the Land Parcel Identification System (LPIS).

2. Montenegro presents an implementation plan for the setting up of a Paying Agency to be fully operational by the date of accession. Taking into account the standards as regards independence, reliability, accountability and financial rectitude, the Plan should include a presentation of the current status of preparation, the future targets indicated in a timetable, a plan of legislation still to be adopted, precise budgetary requirements, human resources needs including recruitment schedule and identification of possible shortcomings and respective solutions. Montenegro demonstrates sufficient progress towards the setting-up of this Paying Agency.

What are the activities in the coming period?

Bearing in mind that IACS is directly related to the establishment of the Paying Agency, with the suggestion of the European Commission (EC), Montenegro considers these two benchmarks as one. Therefore, in order to fulfill it, Montenegro is preparing one Action Document for the establishment of IACS and a Paying Agency which will be fully operational on the date of accession. The adoption of this Action Plan is planned for fourth quarter of 2020. In addition, Montenegro is making efforts to establish the necessary infrastructure and strengthen the administrative capacity both in the Payments Directorate – the future Paying Agency and in general in the Ministry of Agriculture and Rural Development.

Institutions/organizations participating in the negotiation group?

The negotiator for Chapter 11, as well as the Head of Working Group 11, are the representatives of the Ministry of Agriculture and Rural Development, while the contact person for Working Group 11 is from the Office for European Integration.

Members of the Working Group for the chapter 11 are representatives of the following bodies and organizations: the Ministry of Agriculture and Rural Development, Parliament of Montenegro, Ministry of Finance, Ministry of Education, Ministry of Public Administration, Ministry of Labor and Social Welfare, Administration for Food Safety, Veterinary and Phytosanitary Affairs, Customs Administration, Chamber of Commerce of Montenegro, Investment and Development Fund of Montenegro, Statistical Office of Montenegro, Faculty of Biotechnology, University of Montenegro, Faculty of Food Technology, Food Safety and Ecology on University of Donja Gorica, Union of Employers of Montenegro, Monteorganica DOO, Livestock Union of the Republic of Montenegro, NGO Center for Agrarian Development, NGO Center for Rural Development, NGO Boka Olive society, NGO Montenegrin Association of Raspberries, National Association Organic Montenegro, National Association of Winegrowers and Winemakers of Montenegro, Union of Municipalities of Montenegro, Union of Beekeeping Organizations, Sheep and Goat Association, Tobacco Producers Association and Bar Olive Society.

What are the benefits for Montenegro of this chapter?

The EU membership gives to producers greater support and market stability. One of the key features of the CAP is financing over a seven-year period, with precisely defined amounts of subsidies to potential beneficiaries. In this way, all participants in the process of food production, processing and marketing have stability in agricultural policy. Each farmer will be aware of the amount of funds he can count on annually and on that basis he can be free to plan how he will invest.

The EU model will be an incentive for Montenegrin agriculture bearing in mind the importance of mechanisms to support small holdings. Moreover, the EU does not limit the development and increase of production as it can be heard in the public, but repeatedly supports the competitiveness of producers and the introduction of EU standards, while insisting on regional specificities.