US fashion brand Guess is the first "victim" of the new EU geographic blocking regulation, which came into force at the beginning of the month. The European Commission has fined Guess with almost 40 million euros for discriminating consumers in Croatia and a number of new EU member states in its online store, reports Jutarnji List on December 19, 2018.

The Brussels investigation has shown that Guess had fragmented the EU single market by setting 5 to 10 percent higher prices for buyers from Bulgaria, the Czech Republic, Estonia, Croatia, Hungary, Latvia, Lithuania, Poland, Romania, Slovakia and Slovenia. Simply put, if someone from the aforementioned new members of the European Union bought a Guess product over the internet, they automatically paid for it more than buyers from old EU members, according to the EU findings. The European Commission has assessed that this is improper business practice, which is the result of consumer discrimination on the basis of the geographical location. It is also considered to be an obstacle in the development of internet commerce and the single EU digital market. Therefore, Brussels has fined Guess with 39,821,000 euro. The penalty which was initially supposed to be issued has been cut in half because Guess was "cooperating," explained the European Commission.

"There are many illogicalities in online trading, and consumers are suffering. After Guess has been punished, we hope that it will be a warning to others,” said Biljana Borzan (SDP), a Croatian Member of the European Parliament. Similar examples abound in the package delivery business, which is closely related to online retail.

The EU now intends to prevent such practices because the Union wants to encourage the development of online retail trading, which grows at an annual rate of 22 percent. However, according to EC data, only 15 percent of Europeans buy online products from other EU member states, and one of the main reasons is geoblocking.

Ilija Rkman, the former president of the Croatian Consumer Protection Society, agrees with Borzan. “Our statistics show that our consumers mostly complain about material failures of products they have bought, as well as about their warranties. It is hard to believe that a new smartphone or a home appliance can break down so very soon after the purchase. This is an indicator of double standards for consumers in the old and new EU member states,” warned Rkman.

Because of all this, Rkman says that the consumer protection situation in Croatia is not as good as it should be. It has improved somewhat, but Croatia is still at the bottom of the EU. “Consumer protection should be a priority for the government. Today, it is considered a part of the protection of human rights,” Rkman said.

Borzan agrees that there is still much work to be done to strengthen consumer protection. “Our consumers complain less often than those from more developed countries, who fight for their rights,” concluded the Croatian MEP.

More news on the activities of Croatia’s MEP Biljana Borzan can be found in our Politics section.

Translated from Jutarnji List (reported by Adriano Milovan).

 ZAGREB, December 16, 2018 - The European Parliament has proposed a separate, 300 million euro EU budget line for tourism, and the inclusion of tourism in the Council of the EU programme is a confirmation that Croatian lobbying and emphasising the importance of tourism for the economy, both of Croatia and the EU as a whole, was justified, the Tourism Ministry said in a press release on Sunday.

The initiative to better position the tourism industry in the EU institutions was initiated early this year by Croatian Tourism Minister Gari Cappelli. "I am pleased that our initiative has been recognised in the EU, and we also have strong support for it from Prime Minister Andrej Plenković and the Croatian government," Cappelli said in the press release.

"In the EU economy, tourism provides 24 million jobs, in other words, one in eleven workers is employed in jobs directly related to tourism. Considering the fact that tourism is one of the fastest growing economic activities in the EU, with a major impact on growth, society, development and employment, and that tourism and travel account for about 10 percent of the EU's GDP, it is acknowledged that tourism deserves a better position in the EU institutions. This will eventually be of vital importance for tourism in all EU member states, including Croatia," he noted.

The future Council of the European Union presidency trio, comprising Romania, Finland and Croatia, have prepared, in cooperation with the Council's Secretariat General and the European External Action Service, the 18-month programme of the Council for the period from 1 January 2019 and 30 June 2020, which was endorsed in Brussels this month.

The programme for the first time explicitly mentions tourism, in a section entitled "A Union for Jobs, Growth and Competitiveness", noting the need for better positioning of tourism on the EU agenda in order to encourage growth and employment.

In addition, the European Parliament has called on the European Commission to prepare a legislative framework to establish a programme for sustainable tourism, which would be part of the Single Market Programme.

To date, 14 of the 28 member states have supported the Croatian initiative, the Tourism Ministry said.

More news on the activities of Croatia’s Ministry of Tourism can be found in our Travel section.

ZAGREB, December 14, 2018 - During ongoing negotiations on the new multiannual financial framework for the 2021-2027 period, Croatia wants the EU budget to take account of its particularities as the newest member state so that the European project would not be perceived in Croatia as a brain drain destination but as a strong lever to boost economic growth and living standards.

"There is one aspect of membership, and that is free movement of people, which gives the impression that the EU is literally a space for brain drain, in addition to the otherwise big demographic problem. So, in order to avoid the European Union being perceived as a space for brain drain, we need a strong, quick and concrete injection of investment from the European budget to raise the level of development, living standards and GDP growth," Plenković told reporters before the start of the second day of the EU summit in Brussels.

On the first day of the summit on Thursday, EU leaders discussed the proposed multiannual financial framework for 2021-2027. The European Commission had unveiled the document in May, proposing a larger budget for 27 member states than the present one which includes the United Kingdom, a net annual contributor of about 12 to 14 billion euro.

In addition to the budget hole that will be left by the UK's departure from the EU next year, new needs have arisen that require more funding from the EU budget, such as migration, common defence and protection of the external borders. That's why the Commission proposed higher contributions from member states and cuts in funding for individual policies, for example a 10 percent cut for cohesion policy and a 15 percent cut for the common agricultural policy.

While wealthier member states are opposed to increasing national contributions into the European budget and are in favour of cuts in cohesion funding, poorer members take the opposite view - they have nothing against higher national contributions, but are against reducing funding for cohesion and agriculture.

"Yesterday I elaborated to my colleagues that in our case absorption of EU funding is going well, but not fast enough to be felt in increased growth," Plenković said. He noted that Croatia had been an EU member only five years, and that the share of EU funding in investment in member states was about 8.5 percent on average, while in Croatia it was 80 percent. "That's why this funding is crucial to us."

Plenković said that all this year his government had been involved in contacts with the European Commission and other institutions to ensure that, despite the proposed cuts for cohesion and agriculture policies, Croatia received roughly the same amounts for the two policies from the next budget as it had under the present budget.

"We said that account needs to be taken of Croatia's particularities, that it is the newest member state, that it has been using EU funding only for five years, and I think we are getting sympathy," the prime minister said.

He also advocated for Croatia to be granted a longer time frame for using EU funding and for the N+3 rule to be kept in place in Croatia's case, under which funding can be absorbed three years after the conclusion of given contracts. The Commission proposed that this rule be changed to N+2 in the next multiannual financial framework.

Plenković said it was not true that Croatia had the lowest growth among new member states. "That's not true, the point is that we have sound growth. ... Previously, growth was generated by borrowing, while we are implementing fiscal consolidation and have healthy growth. That's the point of this growth of 2.9 percent that we have."

More news on Croatia’s use of EU funds can be found in our Politics section.

ZAGREB, Dec 13 (Hina) - The heads of state or government of the 28 member-states of the European Union convened in Brussels on Thursday for a two-day EU summit which will be dominated by Britain's departure from the EU after Prime Minister Theresa May managed to delay a vote on the Brexit deal in the British parliament.

"We would like to hear the position of Prime Minister Theresa May. Obviously, she is coming with the proposal that she should be given additional assurances. We think that the Brexit deal is really good, and now a lot of political effort is necessary to bring the deal to a conclusion. If that does not happen, the UK can request a prolongation of the deadline, so that a 'hard Brexit' does not take effect immediately after 29 March next year," Croatian Prime Minister Andrej Plenković said in Brussels on Thursday evening.

"Anyway, because of this unnecessary referendum on Brexit, which was a defamatory and in many aspects a fake campaign, now the whole of Europe and especially the UK have a problem," Plenković said.

Other topics on the agenda are the proposed multiannual financial framework for the 2021-2027 period, which the European Commission delivered in early May, as well as migrations, the euro area reform and the fight against fake news.

More news about Croatia’s position on Brexit can be found in our Politics section.

 ZAGREB, December 13, 2018 - Teams of the European Border and Coast Guard Agency (FRONTEX) are soon to arrive on the Croatia-Bosnia border because of the migrant pressure, European Commissioner Vytenis Povilas Andriukaitis said on Thursday and added that the greatest responsibility for the situation on the border lies with Sarajevo and Zagreb.

Negotiations with Bosnia and Herzegovina concerning the deployment of FRONTEX teams have been completed and an agreement will be signed soon. That agreement will enable border police to manage the border between Bosnia and Croatia, however, the most important responsibility is in the hands of those two countries, Andriukaitis said during a debate on the status of migrants in Bosnia currently located near the border with the European Union.

Andriukaitis recalled that currently there are 5,139 migrants and asylum seekers being cared for in Bosnia and Herzegovina.

Of that number, 3,126 are located in the canton in the northwest of the country near the border with Croatia and about 1,000 migrants have still not requested assistance, he said in a plenary session of the European Parliament during a debate on the issue, moved by Croatian MEP Ivan Jakovčić (IDS/ALDE).

According to Andriukaitis, since June this year, the European Union has provided Bosnia and Herzegovina with two million euro in humanitarian aid and 7.2 million euro through special measures and instruments for pre-accession support, and all the measures are being implemented with the assistance of the International Organisation for Migration (IOM), UNHCR and UNICEF.

Over the past few weeks, 180 additional police officers have been deployed to Bosnia and Herzegovina to improve security at the border, Andriukaitis added.

Relations between border police and migrants seem to be positive overall, as EU officials have reported, Andriukaitis said but recalled that Bosnia and Herzegovina is a transit country and the majority of migrants are attempting to cross the border every day.

He said that there was information that Croatian police were abusing migrants on the border with Bosnia, adding that the EC was actively monitoring developments and had informed Croatian authorities of those accusations.

He stressed that the agreement on readmission should be applied to migrants who illegally cross the EU border.

It should be applied without questioning the right to asylum and the obligations that arise from international law, particularly the principle of banning forced readmission, he added.

We all agree that the border between Bosnia and Croatia is the EU's external border and Croatia is responsible to manage that border, he said.

Measures on the EU's external border have to be proportional, they must fulfil fundamental human rights, Andriukaitis said, adding that he was convinced that Croatian authorities would take these accusations seriously and investigate them quickly and thoroughly.

In the ensuing debate, MEP Jakovčić said that he had proposed the debate because of the migrants' difficult situation but also because of the problems facing the local population. He added that the situation was chaotic because on the one hand Croatia was being called out because not everything was quite right with regard to the treatment of migrants while on the other hand, it was expected to protect the EU border.

He added that this was a huge challenge for the European Commission and thanked it for the help it had provided to Bosnia and Herzegovina and the way it was helping Croatia.

MEP Dubravka Šuica (HDZ/EPP) recalled that Croatia was preparing to enter the Schengen area and that Croatian police were doing their best to facilitate the country's entry to that area, and did their work in line with regulations.

She added that the latest data indicated that the number of migrants at the border was 57% higher than last year, with 6,415 more migrants, and warned of the problem of Bosnia and Herzegovina's relaxed visa regime with third countries. "Bosnia and Herzegovina's relaxing its visa regime with certain third countries, primarily Turkey, has led to an increase in the number of illegal entries from Bosnia," she said.

"In any case, it is a fact that work is being done to protect Bosnia and Herzegovina's border, and Albania's and Montenegro's, too, however, Croatia has more border police than all three countries together," she underlined and added that it was necessary to strengthen the asylum system in Bosnia and Herzegovina and other Western Balkan countries.

MEP Tonino Picula, (SDP/S&D), recalled that Croatia has the longest EU land border and that it has not raised razor-wire fences like its neighbours. He underscored that the 6,500 migrants currently in Bosnia and Herzegovina were staying in improvised accommodation close to Croatia's border, which increases the chances of illegal crossing.

He too said that as a member of the Union, Croatia expected to join the Schengen Area as soon as possible and was aware that migration was a global challenge and had therefore supported the UN Global Compact.

More news on Croatia’s migrant policies can be found in our Politics section.

ZAGREB, December 11, 2018 - The European Solidarity Corps, a new European Union programme for the 2018-2020 period that enables young people up to the age of 30 to volunteer or work on projects that benefit people and communities around Europe, was officially launched in Zagreb on Tuesday.

The programme is offering volunteer and occupational activities that support non-governmental organisations, local authorities or private companies in addressing challenging situations across the European Union.

A total of 340 million euro has been set aside for this purpose which will enable 100,000 young volunteers to take part in the programme.

Programmes like this create opportunities for young people to volunteer or work in projects in their own country or abroad that benefit communities and people around Europe, said the chairman of the Croatian parliamentary committee on European Affairs, Domagoj Milošević.

European Solidarity Corps participants could be selected and invited to join a wide range of projects, such as helping to prevent natural disasters or rebuild afterwards, assisting in centres for asylum seekers, or addressing different social issues in communities.

Projects supported by the European Solidarity Corps can last from two to twelve months. They will usually be located within the European Union member states.

Approximately 400 young Croatians are volunteering abroad, while 2,000 foreign nationals are volunteering in Croatia.

More news on Croatia’s status within the EU can be found in our Politics section.

ZAGREB, December 7, 2018 - Three former high representatives of the international community in Bosnia and Herzegovina have sent a letter to the High Representative of the European Union for Foreign Affairs and Security Policy, Federica Mogherini, warning her that Croatia has been interfering in Bosnian internal affairs and stressing that attempts to contest the election of Željko Komšić as a member of the collective state presidency, which are also made by Croatian officials, are unacceptable.

The regional N1 network carried the letter signed by former High Representatives Carl Bildt, Paddy Ashdown and Christian Schwarz-Schilling, in which they remind Mogherini and EU foreign ministers that the ruling of the Bosnia and Herzegovina Constitutional Court, which serves as a basis to challenge Komšić's election – actually refers to the election of members of the House of Peoples of the Federation of Bosnia and Herzegovina entity and not to the election of state Presidency members.

The wrong interpretation of the Ljubić case is used as an argument against the legally elected Croat member of the Presidency of Bosnia and Herzegovina, Željko Komšić. Representatives of the Croatian Democratic Union (HDZ) of Croatia, together with HDZ BiH leader Dragan Čović, claim that Komšić's election is illegitimate and unconstitutional. However, neither the Constitution of Bosnia and Herzegovina nor the country's election law state that Presidency members have to be elected by "their" ethnic groups, the three former diplomats, who had the role of chief interpreters of the Dayton peace agreement, say in the letter.

They recall that Čović was elected to the Presidency twice in line with existing election rules.

It is of crucial importance that at its meeting in December the EU Foreign Affairs Council sends a clear message to political parties in Bosnia and Herzegovina as well as those outside the country that interfere in its internal affairs, reads the letter.

The former high representatives believe that the EU should send a clear message that any reform of the country's election system should make the country more functional and not generate new divisions along ethnic lines.

The second important message they underlined is that the establishment of the government is the main priority, that Bosnia and Herzegovina's borders are inviolable and that Croatia should not interfere in Bosnia and Herzegovina's internal affairs as well as that the European Commission should publish its opinion on Bosnia and Herzegovina's candidate status application as soon as possible.

In a separate statement for N1, Schwarz-Schilling said that he, Bildt and Ashdown had decided to send the letter in order to "stop Croatia's diplomatic offensive" and accused Croatian officials of lying when describing the situation in Bosnia and Herzegovina.

They are mixing the election law and the issue of election of Presidency members, and that is a huge lie used for propaganda against Komšić, Schwarz-Schilling said, adding that the letter was prompted by the fact that no one was clarifying that issue in public.

For more on the relations between Croatia and Bosnia and Herzegovina, click here.

ZAGREB, December 5, 2018 - Croatian Prime Minister Andrej Plenković met with Albanian Prime Minister Edi Rama on Tuesday, saying afterwards that Albanian EU accession negotiations could be opened after the European elections in May and that Zagreb would firmly stand by Tirana in that process.

"Our belief is that, after the European elections, a consensus will be reached on formally opening the accession negotiations and Croatia will support that process with Albania very firmly," Plenković said after meeting with Rama as part of a Central European Initiative (CEI) summit in Zagreb.

He said that at the meeting Croatia once again expressed strong support for Albania in its ambition to join the EU, notably for its embarking on formal accession negotiations now that its legislation was being screened.

"Croatia will continue to strongly support our friends also within the Council of the EU and try to have the pace of that process reflect the meeting of the criteria and Albania's individual achievements," Plenković said, voicing Croatia's willingness to "share the knowledge and experience of Croatian experts."

He said that for Albania and Macedonia it was crucial to begin with intergovernmental conferences and to open the accession negotiations. He said conclusions from June showed that 2018 was the year in which the two countries were becoming acquainted with the EU acquis communautaire.

Rama said Albania and Croatia traditionally had good relations but that they had been growing stronger since Croatia gained independence. "I thank Croatia for the unreserved support to Albania, but also regarding the recognition of Kosovo and our NATO membership." He went on to say that "from the beginning of Croatia's birth, Albania has always been there for its friend and Croatia has always been there for Albania."

He said the statement on strategic partnership between the two countries signed today gave new impetus to Albania-Croatia relations. "We also talked about the further development of economic relations and agreed to organise an economic forum next year."

Prime Minister Plenković also commented on the strategic partnership statement, which, he said, "additionally strengthens our cooperation" and expressed confidence that the agreement would promote trade between the two countries, which currently amounts to more than 60 million euro. "We want our cooperation to proceed within various trilateral and quadrilateral formats in Southeast Europe, notably as regards the Adriatic-Ionian corridor as well as the Adriatic-Ionian gas pipeline, which is a project that is interesting to both countries," said Plenković.

He also mentioned the Albanian minority in Croatia, saying that Croatia "appreciates very much the Albanian minority's contribution to its society."

Asked about the strained relations between Serbia and Kosovo and Belgrade's accusations about an attempt to create a Great Albania, Rama recalled that Serbia had violated the Central European Free Trade Agreement (CEFTA), that Kosovo had complained about it but that there was no response on the other side.

He did admit that Kosovo's increasing customs duties on imports from Serbia by 100% was not normal, but noted that the current situation was not normal either. Under normal circumstances, this would be a problem, said Rama.

As for accusations about a Great Albania, he said that they always appeared when Kosovo Albanians rightfully asked for something and when Albania and Kosovo discussed matters of common interest.

Prime Minister Plenković said that Croatia wanted good relations with everyone – Albania, Kosovo and Serbia. "We want relations to normalise and stabilise, and that is what Enlargement Commissioner Johannes Hahn spoke about today," said Plenković.

Rama, a former basketball player, visited Zagreb's Dražen Petrović Museum, stressing that Albania had always rooted for Croatia, including during the FIFA World Cup in Russia.

The meeting between Plenković and Rama was the last of numerous bilateral meetings held as part of the CEI summit with which Croatia ended its presidency of the initiative, established nearly 30 years ago. The next CEI chair is Italy.

Croatian President Kolinda Grabar-Kitarović also met on Tuesday with Albanian Prime Minister Edi Rama and expressed satisfaction with the continuation of Croatian-Albanian cooperation at the highest level, the president's office said in a press release.

The president said the political dialogue between the two countries was very dynamic and that she wished for the cooperation to continue, the press release said.

The two officials said bilateral relations were traditionally good and friendly, without outstanding issues, and that there was room to intensify economic cooperation, also underlining the importance of strategic partnership between Croatia and Albania.

They also talked about the cooperation between Croatia, Montenegro and Albania as part of the Adriatic Trilateral, and European Union challenges such as migration.

For more on relations between Croatia and Albania, click here.

December 1, 2018 — Being a member of the world’s largest trading bloc has benefits, including nearly EUR 11 billion allocated for Croatia’s EU funds. If only the country actually used it.

Croatia has so far won approval on EUR 6.3 billion-worth of projects through Nov. 15, 2018, yet only 15 percent of those funds were actually doled out, well below the 23 percent EU average. Only Malta is worse, with 12 percent.

Croatia unlocked 59 percent of available EU funds since 2014, with only two years left to withdraw the remainder, according to the latest report on European Structural and Investment Funds.

The bloc’s governing body and Croatia’s government can’t agree on how to interpret the results. Minister Gabriela Žalac of the Ministry of Regional Development and EU Funds said she’s satisfied with the results, after a poor start from 2014 — 2016.

The European Commission called the results “unsatisfactory,” according to Poslovni Dnevnik. The lackluster absorption of EU funding has been a black eye for successive governments.

A recent conference on EU funds concluded Croatian authorities need to better education about EU funds in order to provide full technical support for applicants, helping them prep projects and absorb funds.

The Operational Program for Competitiveness and Cohesion withdrew the most funds, with 62 percent, while the Operational Program for Maritime and Fisheries garnered the least.

The EU funds aim to close the gap between the EU’s poorer and member nation.

So far, Croatia has used EU funds to bolster a number of projects, including craft beer, about HRK 120 million of Split’s overall budget, and most-notably the Peljesac Bridge.

For more on Croatia and the EU, check our dedicated page.

ZAGREB, December 1, 2018 - Croatia is opposed to the European Commission's changes in EU funds regulations. One of them is that the programming of investments financed with EU funds in the Multiannual Financial Framework (MFF) for the period 2021-2027 is done only for the first five years, while decisions on investments for the last two years would be made after a mid-term review, Croatian Regional Development and EU Funds Minister Gabrijela Žalac said in Brussels on Friday.

"The Commission is in favour of discussing implementation effects after five years of the new financial perspective, and only then deciding how much funds will or won't be allocated for the remaining two years. We consider that proposal absolutely unacceptable," said Žalac.

"We want a seven-year period with concrete allocations so that we can know precisely how to plan and prepare programmes," said the minister who attended a meeting of the General Affairs Council which discussed the cohesion policy for the next seven-year period.

Regional Policy Commissioner Corina Cretu said the proposed shortening of the programming period was due to the need for flexibility. She said that previous experience showed that the current framework was not ideal because it was impossible to predict every new challenge and need.

The EC proposal is supported by the richer countries, net contributors, while those that receive more money from the EU budget than they pay oppose it. "For the past two years, the Council has been discussing simplification of rules and procedures for project implementation. I believe that this proposal is contrary to that. I think this is an attempt by net contributors to the EU budget to exert pressure on undeveloped countries, net recipients," said Žalac.

The EC has said that during a review in 2025 it will take into account changes in the socio-economic situation, new challenges identified in the context of the European Semester and the programme success achieved.

With certain restrictions, funds within one programme can be transferred from one investment priority to another without the Commission's official approval, the EC says in its proposal.

Žalac reiterated Croatia's position on the Multiannual Financial Framework proposal which the EC published in early May. Croatia shares that position with all countries that are members of an informal group called "Friends of Cohesion", which held a meeting in Bratislava on Thursday.

Croatia cannot accept cuts in cohesion funds. In the next MFF, Croatia is expected to get 5.6% less funds than in the current multiannual framework.

The country is also against an increase in national co-financing from 15% to 30%, as well as against the shortening of the deadline for the implementation of projects from three to two years.

Croatia also cannot accept a reduction in project pre-financing, i.e. advance payments.

When it published its proposal, the EC called on member-countries to reach agreement on the matter by the end of the term of the current European Parliament, that is, by the spring of 2019, but now it is almost certain that that will not be possible and that a decision will be made after elections for the European Parliament.

The Multiannual Financial Framework proposal has already been discussed two times at the ministerial level, and heads of state or government will discuss it for the first time at the next EU summit on December 13-14.

For more on Croatia and the EU funds, click here.