UNITED NATIONS

E

Economic and Social Council

Distr.

GENERAL

E/C.12/UNK/1

15 January 2008

Original: ENGLISH

Substantive session of 2008

IMPLEMENTATION OF THE INTERNATIONAL COVENANT ONECONOMIC, SOCIAL AND CULTURAL RIGHTS

Document submitted by the United Nations Interim AdministrationMission in Kosovo under articles 16 and 17 of the Covenant

KOSOVO (SERBIA) * ** ***

[Date of submission - 16 October 2007]

CONTENTS

Paragraphs Page

Introduction 1 - 26

Article 1 36

Article 2 4 - 536

A.Budgetary development and protection 4 - 336

B.Principle of non-discrimination 34 - 5317

Article 3 54 - 11323

A.Constitutional and legal framework 54 - 6323

B.Institutional framework 64 - 7525

C.Local government bodies 76 - 7828

D.Mechanisms for the achievement of gender equality 79 - 8729

E.Specific measures and actions taken 85 - 10131

F.Domestic violence 102 - 11035

G.Trafficking in human beings 111 - 11338

Article 4 114 - 11539

Article 5 116 - 12239

A.Abuse of rights 116 - 11739

B.The principle of the primacy of more favourable rights 118 - 12240

Article 6 123 - 23741

A.Legislative framework 123 - 13141

B.Establishment of a functioning market economy 132 - 17044

C.Prohibition of forced labour 171 - 17355

D.Prohibition of discrimination 174 - 18257

E.Labour market situation 183 - 20359

F.Active employment policy 204 - 23773

CONTENTS ( continued )

Paragraphs Page

Article 7 238 - 25880

A.Fair wages 244 - 24682

B.Decent living 247 - 24983

C.Safe and healthy working conditions 250 - 25384

D.Equal opportunities for promotion 254 - 25686

E.Rest, leisure, periodic holidays with pay and remunerationfor public holidays 257 - 25887

Article 8 259 - 30389

A.Constitutional and legislative framework 259 - 26289

B.Establishing, operating and joining trade unions 263 - 28089

C.Trade unions and their links on the Kosovo-wideand international level 281 - 29093

D.Right to strike 291 - 30397

Article 9 304 - 36499

A.Emergency phase 305 - 30699

B.Legal arrangement of the social security system 306100

C.Social welfare system 307 - 309100

D.War invalids and survivors benefits 310 - 318102

E.Old age and disability benefits 319 - 344109

F.Health care and health insurance 345 - 349118

G.Social assistance scheme 350 - 364119

Article 10 365 - 462129

A.Legislative framework 365 - 368129

B.Marriage 369 - 374130

CONTENTS ( continued )

Paragraphs Page

C.Family protection 375 - 376131

D.Contracting and terminating marriage 377 - 386131

E.System of maternity protection - protection of motherhood 387 - 394133

F.Protection of children and minors 395 - 462134

Article 11 463 - 683148

A.Legislative framework 463148

B.Standard of living and poverty rates 464 - 494151

C.Housing and property 495 - 562159

D.Returns and housing reconstruction strategies and results 563 - 603177

E.Electricity 604 - 614184

F.Water 615 - 643187

G.Heating 644 - 650193

H.Food and nutrition 651 - 656194

I.Agricultural development 657 - 683197

Article 12 684 - 763206

A.Legislative issues 684 - 686206

B.General overview 687 - 763209

Article 13 764 - 831225

A.Education system 765 -796225

B.Violence in schools 797 - 802235

C.School abandonment and transport 802 - 808236

D.Higher education 809 - 816238

E.Special needs education 817 - 818240

F.Fundamental education 819 - 821240

CONTENTS ( continued )

Paragraphs Page

G.Teaching staff 822 - 825241

H.Non-public school 826 - 830243

I.Inspection of education in Kosovo 831244

Article 14 832 - 835245

Article 15 836 - 888245

A.Institutional framework 836 - 850245

B.Culture budget 851 - 853250

C.Protection of moral and material interests 854 - 856251

D.Promotion and education on culture 857 - 863251

E.Preservation of cultural heritage 864 - 882253

F.Scientific research 883 - 888256

Introduction

1.In submitting this report on the implementation of the International Covenant on Economic, Social and Cultural Rights in Kosovo to the Committee on Economic, Social and Cultural Rights (CESCR), the United Nations Interim Administration Mission in Kosovo (UNMIK) is acting under the authority granted to it under United Nations Security Council Resolution 1244 (1999) (UNSCR 1244).

2.A draft of this report was prepared by the OSCE Mission in Kosovo on the basis of inputs provided by the Provisional Institutions of Self-Government (PISG) and the Pillars and Offices of UNMIK, and on the basis of other public sources. The Government of Kosovo, through the recently established Human Rights Units in the Ministries, played a significant role in preparing inputs for the report and in commenting on the draft. The draft was subsequently reviewed and revised by the Office of the Special Representative of the Secretary-General of the United Nations.

Article 1

3.In light of the mandate of UNMIK under UNSCR 1244, there are no observations to be made in relation to this Article.

Article 2

A. Budgetary development and protection

1. Development cooperation

4.Kosovo has received a significant amount of international assistance since the end of the conflict in 1999, much of it allocated to specific sectoral projects implemented by various agencies, and a part of it provided as direct budget assistance. The total amount of aid committed by donors between 1999-2005 amounts to 2.7 billion Euro. Between 1999 and 2004, 199,336,299.62 Euro of this amount was disbursed as non-designated budget support - an aid modality that was not sought again until 2006. In addition, between 1999 and 2005, 233.81 million Euro was disbursed as donor designated grants (in effect, designated budget support). The rest of the 2.7 billion Euro disbursed between 1999 until 2005, was issued as project aid, supporting projects implemented either by the donors themselves or by contracted agencies.

5.In the early years, international aid concentrated on emergency humanitarian and reconstruction assistance. Gradually, however, international donor funding was increasingly channelled toward supporting economic development. The contributions of the international donor community have included support to macroeconomic policy (IMF), the coordination of humanitarian aid (UNHCR and the EU), damage assessment and housing (the EU throughthe International Management Group), post-conflict needs assessment, the development of reconstruction and recovery programs, as well as programs for economic and social reform (World Bank, the EU, EBRD, and bilateral donors), agriculture (FAO), support to the private sector (EBRD, IFC, and bilateral donors), and community-based development (World Bank, the EU and bilateral donors).

6.The first Donor Conference for Kosovo, organised by the Joint European Commission/World Bank Office, took place on 28 July 1999 in Brussels, focusing on the humanitarian situation and the transition to civil administration. The meeting endorsed an action plan aimed at rebuilding Kosovo through the support of the international community. This event initiated a co-ordinated process of international support throughout the reconstruction period, which lasted from 1999-2003. The Reconstruction and Recovery Programme prepared by the World Bank and EC, in cooperation with UNMIK, estimated that an amount of USD 2.3 billion was required during the reconstruction period in order to achieve three objectives: the development of an open and transparent market economy; the establishment of a public administration and transparent, effective and sustainable institutions; and the mitigation of the effects of conflict/the legacy of the 1990s.

7.Pledges made at the Second Donor Conference (also organised by the Joint European Commission/World Bank Office) which was held on 17 November 1999 in Brussels reached USD 1.06 billion, out of the USD 1.1 billion required to commence the first phase of the recovery programme and to cover the recovery needs to the end of 2000. By December 2000, donors had committed a total of USD 1.3 billion.

8.The Third Donor Conference (also organised by the Joint European Commission/World Bank Office) was held in Prishtinë/Priština in February 2001, and asked donors to respond with new pledges by the end of March 2001. Donors committed an amount of USD 0.6 billion. Donors were asked to concentrate their efforts on economic development and reform and were presented with a Medium Term Expenditure Framework for Kosovo prepared by UNMIK

9.The fourth Donor Meeting (also organised by the Joint European Commission/World Bank Office) was held in Prishtinë/Priština in April 2006, and introduced donors to the new Medium Term Expenditure Framework 2006-2008 (MTEF), which had been prepared in close cooperation between the PISG Ministry of Finance and Economy (MFE) and the UNMIK Fiscal Affairs Office (FAO). The MTEF provided both a three-year expenditure and revenue forecast, and sectoral analyses. The sectoral analyses included lists of spending initiatives, both those already funded by the Kosovo Consolidated Budget (KCB) and those that were ripe for donor support. Donors pledged 55 million Euro toward Budget support.

10.Meanwhile, work has been underway throughout 2005 and 2006 to produce a Kosovo Development Strategy and Plan (KDSP) - a comprehensive mid-term socio-economicdevelopment strategy for Kosovo, along the lines of the National Development Plans (NDP) that are usually required by the EU in the pre-accession processes. Spearheaded by the PISG, and with financial and technical support from the donor community, a first draft of the KDSP was completed on 18 December 2006. While substantial work is still necessary, the KDSP, as the most sought out development framework by international financial institutions, multi-lateral and bilateral donors alike, should serve as a future basis for identifying priority areas for donor support.

11.It should be noted that the establishment of two data bases - one housed by the Joint European Commission/World Bank Office in Brussels, and the other with the MFE in Prishtinë/Priština - known as RIMS (Reconstruction Intervention Monitoring System) - have, from the very beginning, contributed to aligning donor pledges and commitments with Kosovo’s needs. The database maintained by the Joint Office tracks overall pledges made at donor meetings and has a direct communication with donor capitals. Its objectives are to provide an additional reference for the Government in its effort to integrate external financing into the budget; to identify donor resources and funding gaps in various economic sectors; and to help the international community to have a better idea of overall aid flows to Kosovo. The database provides aggregated information on donor pledges, commitments, and expenditure. The database maintained by the MFE (initially maintained by the UNMIK Department of Reconstruction) is a detailed contract-based database, providing information on the progress of donor funded projects. The database is meant to help donors design their assistance programs while avoiding overlap with other donor interventions, as well as to help the MFE in monitoring the programmes. Project specific information for this database was initially collected by the UNMIK Department of Reconstruction from local sources (donors, implementing agencies) rather than from the donor capitals. It is verified with local donor representatives on a bi-annual basis.

12.Finally, donor co-ordination efforts took on an institutional dimension with the establishment of structures such as the MFE’s Unit of Donor Coordination, which functioned from 2002-2005. In April 2006, a new Donor Coordination Unit was established within the Office of the Prime Minister. Its role is to handle inquiries from donors and help direct donors to meritorious projects.

13.The tables below contain information on the aid disbursement during the time period 2000‑2003 for each sector.

14.Data from the MFE indicates that much has been achieved as a result of international assistance, including the repair of more than a thousand kilometres of road and an increased provision of energy supply. Schools and clinics have also been constructed throughout Kosovo, thereby ensuring basic infrastructure for health and education.

Table 1

Kosovo Reconstruction and Recovery Programme,External Financing Requirements (in US Dollars)a

Activity

First phase (until December 2000)

Second phase (2001-2003)

Total

Until March 2000b

April-Dec 2000

Total

Agriculture

8

86

94

141

235

Private Sector Development/Industry

16

104

120

110

230

Institutions

15

35

50

50

100

Housing

36

270

306

214

520

Water and waste

30

49

79

181

260

Landmine clearing

7

14

21

9

30

Education

11

38

49

36

85

Health

16

24

40

45

85

Telecommunications

15

26

41

54

95

Energy

51

78

129

281

410

Transport

12

57

69

96

165

Subtotal

217

781

998

1 217

2 215

Budgetary support c

68

60

128

TBD

TBD

Total

285

841

1 126

1 217

2 343

This table has been extracted from the “ Report on Activities of the European Commission/World Bank Office for South East Europe 2001 ”.

a The figures are estimates and do not include humanitarian requirements.

b The requirements until March 2000 correspond to urgent activities.

c Budgetary support will be needed to finance a deficit, estimated at the time of writing at USD 48 million for 1999 and USD 80 million for 2000 (including USD 20 million for the period January to March 2000). Budgetary support requirements for the period 2001 to 2003 were not known at the time of writing.

Table 2

Outcome indicators of infrastructure projects relatingto reconstruction and repairs

1999

2000

2001

2002

2003

Total

Kilometre of road

0

487

926

36

26

1 475

No. of houses

0

11 782

5 828

2 074

0

19 684

No. of schools

81

89

110

99

80

459

No. of health care centres

10

28

46

18

73

175

No. of household hours with  electricity (million)

4.0

4.6

5.1

5.6

5.5

24.8

m2 landmines cleared (million)

4.7

27.5

0.2

0.3

0

32.7

Source: Donor Coordination Unit, MFE.

Table 3

Data for sectoral donor budget distribution, January-December 2004

Sectors

Committed

Contracted

Spent

Trade and industry

38065

23821

21034

Democratic governance and civil society

36963

29245

22374

Public utilities

26310

34657

53862

Economy and finance

14128

12700

11275

Justice

11351

9847

10066

Local administration

8915

4321

3 026

Agriculture

6729

3574

3 995

Education and science

6251

4206

8 050

Housing

5767

5409

6 809

Health

4696

6809

7 253

Environment

3580

1058

1 049

Culture

3530

856

574

Social welfare

3429

4672

2 702

Other Sectors

2978

3059

3 190

Labour and employment

2177

1387

1 202

Public services

2167

3355

1 684

Youth

1409

559

547

Kosovo Police Service

1386

1887

1 778

Mine Action Co-ordination Center

860

860

Civil security and emergency preparedness

400

400

375

Transport and infrastructure

176

456

1 956

Total

181 267

153 139

162 799

Source: MFE.

Note: amounts are in thousands of Euro.

2. The establishment of a public sector budget for Kosovo

15.A Central Fiscal Authority (CFA) was established in November 1999 through UNMIK Regulation No. 1999/16 On the Establishment of a Central Fiscal Authority of Kosovo and Other Related Matters. Acting under the authority of the SRSG, the CFA was responsible for the overall financial management of the Kosovo General Government Budget and the budgets falling under the responsibility of municipalities (which together form the Kosovo Consolidated Budget - the KCB). In February 2003, the responsibilities of the CFA were handed over to the PISG Ministry of Finance and Economy (MFE), which bears responsibility for budget development and execution. In May 2003, the Law No. 2003/2 On Public Financial Management and Accountabilities (LPFMA) was promulgated through UNMIK Regulation No. 2003/17 of 12 May 2003, providing the legal framework for the development and execution of, as well as the reporting on, central and municipal budgets, the control of the receipt and expenditure of public money, and other aspects of public financial management. The MFE has the authority to issue administrative instructions and other subsidiary executive instruments (such as financial rules) for the implementation of the LPFMA. In accordance with the Constitutional Framework, the final approval of the Kosovo budget is a reserved responsibility of the SRSG.

3. Training on human rights based budgeting

16.In the second half of 2006, the OSCE/Pillar III provided two rounds of introductory training on human rights based budgeting to selected municipal officials relevant to the municipal budget process. The first round addressed all municipal finance officers of each municipality of Kosovo, although the finance officers of Serbian dominated municipalities in the north of Kosovo declined the invitation to attend. The first round gave a basic introduction to the International Covenant on Economic, Social and Cultural Rights (ICESCR) and its applicability in Kosovo under UNMIK Regulation No. 1999/24 On the Law Applicable in Kosovo of 12 December 1999, as amended. Using the example of a recent report by OXFAM on the significance of public sector health, education and water services to overall development, the training discussed the relationship between municipal budget allocation and enjoyment of economic and social rights. The training concluded with a basic case study highlighting the operation of principles of non-discrimination in the delivery of public services.

17.The second round of training addressed all members of the Boards of Directors of five municipalities in the region of Pejë/Peć. This training round elaborated on the previous content and developed the significance of budgeting as a human rights process. The training discussed the range of ICESCR articles and reviewed the general obligations of public authorities to take steps towards the full realisation of economic, social and cultural rights, non-discrimination and equal rights between men and women. The specific obligations to respect, protect and fulfil socio-economic rights were reviewed. Through a number of case studies on the rights to health and adequate housing specific elements of each right were discussed including availability, accessibility, affordability, quality and security of tenure (for housing). Principles of non‑discrimination were discussed and the concrete link was highlighted between municipal budgets and implementation of public obligations to secure socio-economic rights for all, especially the most vulnerable groups. The training round concluded with a complex exercise to highlight the relationship between budgetary choices and effective realisation of ICESCR rights.

4. Taxation

18.On 31 August 1999, and following a surge of uncontrolled imports after the armed conflict, UNMIK established a Customs Service with the aim of collecting customs duties, excise duties on specific goods, and sales tax on imports. The Customs Service developed quickly, increasing its staff from 36 persons in 1999 to 577 in 2006. Its efficiency has improved throughout the years, with an average collection rate of 0.8 million Euro per employee. Revenues collected by the Customs Service constitute the largest contribution to the Kosovo Consolidated Budget, providing more than 65% of total revenues.

19.A Sales Tax (at the rate of 15%) was introduced in January 2000, and a Service Tax (at the rate of 10% of gross receipts) for hotels and restaurants was introduced in February 2000. These two taxes were replaced by a Value Added Tax (at the rate of 15%) in June 2001. An excise tax was subsequently introduced and represents a solid share of budget revenues. The taxation of income started in May 2000 with the introduction of a Presumptive Tax. Another step was the introduction of a Profit Tax and an Income Tax in February 2002. These three taxes have been consolidated and replaced by a Corporate Income Tax and a Personal Income Tax with effect from January 2005. The Corporate Income Tax is charged at a flat 20% rate on income, while the Personal Income Tax is progressive. The tax system was built in a relatively short period of time so as to ensure sustainable resources for the KCB. The result has been a continuous growth in revenues, from 287 million Euro in 2000 to about 700 million Euro in 2006.

20.The administration of domestic taxes was conducted by the CFA until February 2003. The responsibility was subsequently transferred to the Tax Administration of Kosovo (TAK). The collection of domestic taxes remains weak and the efficiency of TAK compared to UNMIK Customs is low, with an average collection rate of 0.25 million Euro per employee.

5. Public procurement

21.The Law on Public Procurement, promulgated by UNMIK Regulation No. 2004/3, sets out the rules and procedures for public procurement with the purpose to ensure the most efficient, cost-effective, transparent and fair use of public funds and resources in Kosovo. The law also aims to ensure the integrity and accountability of public officials, civil servants and other persons conducting or being involved in public procurement activities. Responsible for the implementation of the law is the Public Procurement Rules Committee (Rules Committee), which shall develop rules and procedures for the tendering and review process. The Rules Committee has drafted several public procurement rules and the Public Procurement Agency (PPA) has adopted a Working Regulation and Administrative Guide No. 2006/1 further implementing the Law on Public Procurement. It includes amendments in the tender dossier for supply, work and services. In view of public procurement, the PPA has also introduced eight manuals explaining a wide spectrum of issues such as the preparation of tender dossiers, procurement procedures, contract notices, determination of the procurement procedure, procurement planning, evaluation of needs and availability of means. It has also produced a brochure for procurement officials and a guide on reading the Law on Public Procurement. A revised law on public procurement with the aim of further simplifying and improving the procedure of procurement has been passed by the Assembly of Kosovo and promulgated as UNMIK Regulation No. 2007/20.

6. Financial investigations

22.One of the key policies of UNMIK is the policy of zero tolerance against crime. In the framework of this policy, the Financial Investigation Unit (FIU) was established on the initiative of the Special Representative of the Secretary-General (SRSG) in 2003. The Italian Government agreed to provide Guardia di Finanza investigators to staff this specialized unit. There are three key documents, which define the legal status, role, mandate, and the scope of activities of the FIU: (a) The Agreement between UNMIK, the European Agency for Reconstruction (EAR) and the Government of Italy; (b) UNMIK Administrative Direction No. 2003/3 On the Establishment of the Financial Investigation Unit of 31 January 2003; and (c) Executive Decision No. 2003/16 on the Establishment of the Investigation Task Force.

23.Firstly, the Agreement, signed on 26 February 2004, specifies the terms and conditions, the rights and responsibilities of UNMIK, EAR and the Government of Italy as parties to the agreement on the provision of specialized financial investigation services. It defines the undertakings of the Italian government to provide specialized financial police investigators; UNMIK to provide an appropriate working environment; and EAR to provide financial contribution to staff costs and other relevant expenses.

24.Secondly, the UNMIK Administrative Direction 2003/3 establishes the Financial Investigation Unit (FIU) as the specialized unit responsible for investigating the activities of entities funded from the Kosovo Consolidated Budget; defines the mandate of the FIU as to fight financial crime and crime involving corruption in Kosovo; and states that the powers and the responsibilities of the FIU are determined as those of the law enforcement authorities under the applicable law in Kosovo. The powers of the FIU are to conduct administrative inspections (searches of offices, premises, and documents); to conduct investigations where there are grounds to suspect that a financial crime or a crime involving corruption has been committed; and to proceed in accordance with the applicable law on criminal procedure once there are grounds to suspect that a financial crime or a crime involving corruption has been committed.

25.Thirdly, the Executive Decision No. 2003/16, signed on 21 October 2003, establishes the Investigation Task Force (ITF), consisting of the representatives of the Office of Internal Oversight Services of the United Nations, the European Anti-Fraud Office (OLAF) and the FIU. The Decision defines the mandate of the ITF as “to identify fraud and corruption involving any of the following institutions and entities, and the personnel thereof”: (a) UNMIK, including its Pillars and other organizational structures; (b) Local governmental institutions; (c) Independent bodies and offices established pursuant to the Constitutional Framework; (d) Publicly-owned enterprises and other entities operating with public assets and socially-owned enterprises operating under the general authority of the Kosovo Trust Agency; or (e) Any other institution or entity performing activities that are funded, in whole or in part, from the Kosovo Consolidated Budget. In particular, the FIU is contributing to ITF activities with a permanent deployment of investigators; following up the criminal cases deriving from ITF administrative investigations; and co-operating and providing information and assistance to OLAF for preliminary enquiries as well as operations on the field.

26.The FIU activities are developed according to the information collated by the examination of KCB revenues and expenditure; intelligence activities; activities delegated by International Prosecutors; activities developed in co-ordination and close co-operation with other agencies; and activities related to capacity building of Kosovo Police Service (KPS) Officers (especially those of them deployed in Economic Crime Units established within local Police Stations). By processing all the data, the FIU operates the detection of sectors to be investigated. Based on the results of the review of the Kosovo Consolidated Budget, the FIU focuses its investigative activities on sectors that are considered particularly sensitive. Factors such as amounts of funding assigned to KCB and categories of expenses with potentially high risk of criminal violations (bribery, procurement related crimes, misappropriation, etc.) are taken into account. In the FIU’s activities intelligence information is very important. Several successful investigations were initiated based on information acquired through intelligence channels. It is not possible to forecast which kinds of information intelligence sources can provide in the future, but it is possible to focus on some sources close to sectors considered the most sensitive. The operational plan should also consider that FIU is often entrusted by International Prosecutors to carry on judicial investigations related to financial crimes. Some of the FIU activities are developed in co-operation with other agencies. The FIU has developed co-operation and institutional co-ordination with the following entities: Investigation Task Force; Office of the Auditor-General; Public Procurement Regulatory Commission; Financial Information Centre; Financial Intelligence Unit; UNMIK Police Specialized Units (Economic Crimes Unit, Kosovo Organized Crime Bureau) and a number of other entities.

27.The FIU has developed a wide range of investigative activities. In all cases where an international UNMIK staff member or other person benefiting from immunity from prosecution, the FIU has sought and been granted a waiver of immunity in order to undertake its investigation. It is also examining the functioning of the PISG, Publicly Owned Enterprises (POEs) and Socially Owned Enterprises (SOEs), with particular interest in the privatization process. The fight against organized crime, financial crime and corruption has been noted as key areas where in the future international involvement will be necessary and essential. The prevalence of cross-boundary, cross-border and multi-national organized crime with some or all of its roots in Kosovo justifies the presence of an international unit for the time being. A European Union Planning Team is currently analyzing and studying an appropriate structure to meet the relevant needs.

28.Some statistics from 2005 of the activities of the FIU are the following. Sums indicated to be recoverable FIU investigations amounted to 948.935 Euro. Seizures and forfeitures were: 1 passport, 3 cellular phones with SIM cards, 2,310 cellular recharge scratch cards (valued at 63,673 Euro), 62,800 Euro in embezzled incomes and 10,000 Euro nominal value of 50% of shares in a private activity. The table below shows a number of activities related to the work of the FIU.

Table 4

Financial Investigation Unit activities 2005

Financial Investigation Unit s tatistical d ata

1 Jan 05 - 28 Feb 05

1 Mar 05 - 31 May 05

1 Jun 05 - 31 Aug 05

1 Sep 05- 31 Dec 05

Total

No. of a rrest w arrants

1

0

1

0

2

No. of administrative searches

1

3

3

7

14

No. of inspections

2

8

4

5

19

No of ongoing investigations

6

10

5

17

No. of interviews

37

39

12

34

122

No. of financial transactions requests

1

9

45

20

75

No. of covert technical measures

1

6

8

1

16

No. of crime reports submitted

18

29

10

23

80

No. of summons

5

2

11

7

25

Source: Financial Investigation Unit.s

7. Anti-corruption measures

29.The Kosovo Assembly Law No. 2004/34 On the Suppression of Corruption prescribes measures against corruption within the scope of the anti-corruption strategy, particularly within the field of administrative investigation of public corruption. This is to “eliminat[e] the causes of corruption, the incompatibility of holding public office and performing profit-making activities for official persons, restrictions regarding the acceptance of gifts in connection with their execution of office, supervision of their assets and those of persons from their domestic relationship, and restrictions regarding contracting entities participating in public tenders conducting business transactions with firms in which the official person or person from his/her domestic relationship is involved”. The law envisages the creation of the Kosovo Anti‑Corruption Agency, directly supervised by the Agency Council. The Action Plan against Corruption, which will make possible the implementation of the referred to strategy, was approved in October 2006. It presents a mutual initiative by local and international experts regarding the situation of corruption in Kosovo, tackling the public opinion, as well as the first steps in the process of eliminating corruption. On 7 February 2006, the Government of Kosovo approved its Anticorruption Action Plan. The Anti Corruption Agency and Agency Council have established their procedural rules and guidelines.

8. Management of Publicly Owned Enterprises

30.The Kosovo Trust Agency (KTA) has been working on the incorporation, corporate governance and capacity building of those Publicly Owned Enterprises (POEs) that fall under the responsibility of its POE Division. These enterprises cover the water, waste and irrigation sector, the post and telecommunications sector, the airport, the district heating sector, UNMIK Railways, and the energy sector. Incorporation has been necessary due to the fact that POEs, like many other former socialist enterprises, had an unclear legal status and internal structures unfamiliar to investors, banks, suppliers, consultants and auditors. Incorporation is meant to give the POEs a clear legal status by turning them into Joint Stock Companies (JSCs) under the regulation on business organisations in Kosovo.

31.The incorporation process consists of the following: (a) Legal and financial work leading to the incorporation of legal entities with comprehensive company data compiled in an information memorandum; (b) Implementation of corporate governance structures, leading to transparent business decision processes, permitting management and control of planning and execution of activities in a most efficient manner; (c) Preparation of the enterprises to manage funds according to established regulations and to increase efficiency; and (d) Preparation of the enterprises to effectively plan and realize new projects and receive debt capital from international finance institutions and syndicate lenders for such projects. In short, incorporation is meant to improve corporate governance, financial transparency, accounting procedures, and the efficiency of the POEs, making them more attractive to outside licensing agencies, investors and lenders, and suppliers.

32.In January 2006, assisted by funds from the European Agency for Reconstruction (EAR), the KTA completed the incorporation of the Kosovo Energy Corporation (KEK), UNMIK Railways, and the district heating enterprises Termkos and Gjakove, thus finalizing the incorporation of all major POEs in Kosovo. Pristina International Airport and Post and Telecommunications of Kosovo had been incorporated in June 2005. The incorporation of water, waste, and irrigation enterprises commenced in late 2006 and is expected to be completed by August 2007.

33.An incorporated company, by definition, has the necessary prerequisites for a reliable corporate governance structure. The KTA’s POE division has thus been implementing a single board of directors structure, complemented by a supervisory board in all POEs. In 2006, all incorporated POEs had functioning boards of directors, comprised of members nominated by UNMIK, the PISG, and POE management. In the second half of 2006, the KTA Board also approved PISG nominations to the supervisory boards of the POEs. Finally, the KTA has continued to work on a capacity-building programme with the POEs in order to empower POE staff to independently undertake duties related to procurement, legal issues, internal audit, and budget and finance.

B. Principle of non-discrimination

1. Legal framework

34.The principle of non-discrimination is part of the fundamental laws of UNMIK Regulation No. 1999/24 On the Law Applicable in Kosovoand the Constitutional Framework.Furthermore, UNMIK Regulation No. 1999/1 On the Authority of the Interim Administration in Kosovo of 25 July 1999, which was the first Regulation to be adopted, enshrines these principles in its Section 2 by stating that: “In exercising their functions, all persons undertaking public duties or holding public office in Kosovo shall observe internationally recognized human rights standards and shall not discriminate against any person on any ground such as sex, race, colour, language, religion, political or other opinion, national, ethnic or social origin, association with a national community, property, birth or other status”.

35.The principle of non discrimination is further reaffirmed in Article 2 of the Anti‑Discrimination Law (ADL), as “equal treatment shall mean that there shall be no direct or indirect discrimination against any person or persons, based on sex, gender, age, marital status,language, mental or physical disability, sexual orientation, political affiliation or conviction, ethnic origin, nationality, religion or belief, race, social, origin, property, birth or any other status”.

36.The purpose of the ADL is to provide effective implementation and enforcement mechanisms, proportionate and dissuasive sanctions in the case of violations by either public or private actors. The proscription of discrimination encompasses both direct and indirect discrimination, harassment, instruction to discriminate, victimization and segregation. The ADL applies to “all natural and legal persons as regards both the public and private sectors, including public bodies, in relation to any action or inaction which violates those rights of any natural or legal person or persons” and comprehensively encompasses economic, political, social and cultural areas. Any claim of discrimination under the ADL is to be decided or adjudicated upon in accordance with the applicable law by administrative bodies and courts with subject-matter jurisdiction over the case. A fundamental aspect of the ADL, enhancing protection to victims of discrimination in claims against institutions, is shifting the burden of proof to the respondent accused of discriminatory treatment. Alleged victims can be supported by various organisations or legal entities when making the claim.

37.The Law empowers courts not only to grant compensation for damages to the victims of discriminatory treatment but also to impose fines up to 2,000 Euro on any institution violating the ADL. Furthermore, the Law authorises the Ombudsperson of Kosovo to receive and investigate complaints concerning discrimination cases. It is important to note that the ADL encourages the use of positive actions to ensure a genuine equality in daily practice. Such actions aim at the prevention of, or compensation for, disadvantages experienced by individuals belonging to certain groups, such as persons with disabilities, women, IDPs, returnees, etc. Additionally, in the case of violation of the law, positive measures can be judicially imposed. In addition, contracts for public financing or benefits must include provisions for compliance with the ADL and shall be revoked by the body awarding it in case of violation of the law. Finally, the ADL provides that all monies collected through the imposition of penalties on those who have violated the Law shall be placed in a fund for the purposes of supplying free legal assistance to any natural or legal person whose right to equal treatment is violated.

2. Implementation of laws

38.The Constitutional Framework, the ADL as well as the mandate of all of the PISG’s Ministries provide for legal protection against discrimination, which has significantly improved formal equality of all groups subject to discrimination in Kosovo. However, assessing the extent of discrimination towards women, children, minorities, persons with disability and other vulnerable groups at both central and local level is difficult to perform due to lack of data. Numbers and statistics on the representation and proportion of minorities, women and IDPs in issues related to returns, re-integration, accessing social services and participation in decision‑making procedures is limited. The absence of adequate information is a problem. The statistics that are available show disparities between majority and minority communities, and especially for Roma, Ashkali and Egyptians, in respect of education, employment and poverty. Women, especially rural women, are mostly disadvantaged in respect to employment (rural female labour force participation is at 25.54% versus for rural male 74.39%) and education (mean years of schooling 7.94 for women versus 10 for men).

39.An important aspect of ensuring that theory is transformed into practice and that laws are properly adhered to, is to have a reliable system for monitoring the implementation of laws. In order to better being able to monitor the level of implementation of laws, the Government is currently working on an internal oversight mechanism of the implementation of laws and a formalised administrative link to the Assembly Secretariat. In addition, the Assembly is reviewing their capacities on legislative oversight over the executive branch.

40.Another crucial aspect of the implementation of laws is the undertaking of promotional activities. The Advisory Office for Good Governance in the Prime Minister’s Office (AOGG), upon promulgation of the ADL, organized a public information campaign to raise awareness of the ADL and of the rights it guarantees. The campaign consisted of a press conference, a workshop for the ministries and UNMIK officials and a two-phase promotional campaign where brochures, leaflets and posters were produced (in Albanian, Serbian, Bosniak, Turkish and Romany) and first disseminated to civil servants and then to the general public. The Department of Central Administration at the Ministry of Public Services (MPS), Municipal Gender Officers and NGOs were engaged in making sure that dissemination was Kosovo-wide reaching all municipalities. Additionally, AOGG contributed to a number of donor supported initiatives to raise awareness and knowledge within the general public with regard to the content of the Law as well as training activities for lawyers and judges.

41.The Permanent Secretary of the Office of the Prime Minister established a working group to draft all sub-legal acts for the implementation of the ADL. Since August 2005 the working group meets regularly and during its second meeting comments were given on the draft Administrative Instruction proposed by the MPS. To address the matter in a comprehensive way, throughout 2005 a co-ordinated plan of action identifying the critical path for the effective implementation of the plan has been developed by the Office of the Prime Minister, in cooperation with the OSCE/Pillar III, the Office of the High Commissioner for Human Rights (OHCHR) and UNMIK. On 11 October 2005, the Anti Discrimination Law Comprehensive Action Plan was adopted after a public debate was organized by the Prime Minister.

42.Furthermore, in the sphere of promotion and implementation of legislation on equal opportunities and anti-discrimination, during November 2006, the AOGG has concluded a two‑year campaign implemented in the whole territory of Kosovo. This contributed to capacity building of municipal officials regarding implementation of the ADL, especially identification of institutional mechanisms for its implementation, identification of priorities, including the possibilities for implementation and drafting of special plans and strategies related to elimination of shortcomings identified in this sphere. Identification was also carried out of mandatory obligations deriving from legislation, or obstacles and difficulties, respectively. A series of debates were organised from which the following recommendations relating to economic, social and cultural rights were made: (a) Better working conditions and working environment in Municipal Returns and Dialogue Offices should be created; (b) renovation or reconstruction of certain run down school facilities should take place; (c) road infrastructure should be improved in some areas; (d) the situation in the sphere of education should be improved; and (e) the situation in the sphere of health should be improved through, inter alia, the opening of a Medical-Nursery Unit in a particular area.

3. Non-discrimination and affirmative action in the civil service

43.UNMIK Regulation No. 2001/19 On the Executive Branch of the Provisional Institutions of Self-Government in Kosovo offers an important example of affirmative action in the sphere of public employment. Permanent Secretaries of the Ministries and Chief Executive Officers of the Executive Agencies are mandated to implement “non-discriminatory personnel policies within the Ministry or Executive Agency, including equitable gender representation, in all areas and levels and ensuring that the composition of the personnel reflects the multi-ethnic character of Kosovo”. The Regulation specifies that “representation in the composition of the Civil Service at all levels shall be closely proportionate to the representation of non majority communities in the Assembly.”

44.To give effect to the principle of “Fair Representation in Civil Service”, intended to correct imbalances effectively excluding minorities, including IDPs and refugees, from access to jobs and resources on the basis of their ethnicity and/or gender, UNMIK Regulation No. 2001/36 (the Civil Service Law) and, in particular, UNMIK Administrative Direction No. 2003/2 implementing it, establishes that: “All employing authorities […] may utilize the following affirmative action measures as needed: (a) Active recruitment: making special efforts to identify and solicit job applications from under-represented populations, especially internally displaced persons and refugees; (b) Addressing results of long-term discrimination: developing on-the-job training programs for commonly disadvantaged populations to enhance their ability to apply and compete for promotions; and (c) Addressing discrimination by ensuring that personnel understand anti-discrimination policies and have access to adequate grievance procedures”.

45.Another important aspect of this Law is that it provides, through an Administrative Instruction (AI) all employing authorities with guidance to enable them to meet their legal responsibilities for building a multi-ethnic civil service based on the principle of Equal Opportunities. According to the AI, Equal Opportunities Officers shall be appointed in all Ministries, Municipalities and Executive Agencies and tasked to prepare Equal Opportunity Policies (EOP) and their correlated Implementation Strategies, setting out the practical steps to be taken over the next three years to achieve the objectives set out in the EOPs including the active steps to be taken to: “(a) Encourage applications for employment in the Ministry/ Municipality/ Executive agency from under-represented sections of Kosovo society, including members of minority communities, women and people with disabilities; (b) Ensure that minority communities, women and people with disabilities are represented at all levels within the employing authority; (c) Promote understanding of the importance and benefits of a genuinely representative civil service among all employees; (d) Encourage the use ofboth Kosovo’s official languages by all employees; and (e) Ensure that all clients of the Ministry/ Municipality/Executive Agency’s services are offered the same high quality of service in accordance with equal opportunities procedures”. Each Permanent Secretary/Chief Executive Officer within Municipalities, Ministries and Executive Agencies should monitor and report on progress in implementing equal opportunities on a regular basis.

46.However, so far little action has been taken to appoint Equal Opportunities Officers in Ministries, Municipalities and Executive Agencies, and also for establishing criteria and procedures for implementing and monitoring Fair Representation in the Civil Service at all levels. Despite recent improvements, mostly as a result of the Standards process, several posts reserved for minorities remain unfilled.

47.To enforce the principle of fair representation in the civil service, UNMIK adopted a decision in June 2002 to establish Proportional Community Representation. The Advisory Board on Communities (ABC) Working Group on Minority Employment (WGME), consisting of representatives from Pillar II/ Office of Community Affairs, Pillar III/OSCE, Pillar IV/EU, Office of the Prime Minister, Ministry of Labour and Social Welfare, Ministry of Public Services, UNHCR, the Alliance for Rights and Tolerance, and the Office of Returns and Communities, developed an effective methodology for establishing proportional community representation in the civil service. The then-SRSG Michael Steiner approved the representational goals and plans.

48.The point of departure for the WGME was the results of the Central Assembly election of 17 November 2001. Based on these accepted proportions, the Working Group developed representation ranges for achieving community proportionality in central level civil service employment, which would reflect to the extent possible the representation of communities in the Assembly of Kosovo. Under the concept described above, the representation ranges can reflect one of two non-majority Assembly member totals: (1) the number of set-aside seats for minorities, or (2) the total number of minority seat holders. Under such formulations Kosovo Serb representation would range between 8.3 and 18.3 %, while non-Serb minorities would collectively represent between 8.3% and 10.8%. These ranges can assist in the identification of appropriate representational goals. They can also be used as benchmarks for a monitoring mechanism: exceeding the maximum raises questions about favouritism, while failure to reach the minimum threshold should raise concerns about discrimination. Either development would point to the need for intervention.

49.In addition, affirmative action to accompany the representation ranges was proposed: promoting equal opportunity in hiring by “expanding the active recruitment drive for members of minority communities and extending their job application deadline appropriately” if a balanced pool of applicants has not been reached by the job application deadline, promoting affirmative preference by offering “hiring and promotion preferences to members of minority communities who meet the required eligibility standards, in order to meet representation range requirements that ensure proportional representation at all levels of civil service”, and, addressing the results of long-term discrimination by developing “job-training programs for commonly disadvantaged populations (i.e. the RAE communities) to enhance their ability to apply and compete for jobs”. Unfortunately, neither the methodology for establishing proportional community representation, nor the affirmative action proposals have been implemented to the present date and, particularly at senior level management positions, the recruitment of minorities has too often been seen as a question of filling a quota than providing meaningful participation.

4. Remedies

50.The sustainable protection of any human rights, including non-discrimination in relation to economic, social and cultural rights, includes the use of effective remedies in order to address the relevant violation. Many of the Ministries have adopted Administrative Instructions which request the establishment of an Office for Complaints, to which Kosovo residents may submit their appeals for insufficient provision of services. Currently the Ministries have different ways in which they deal with requests, however many have expressed budgetary constraints as an impediment to the establishment of relevant offices.

51.The Ministry of Industry and Trade has an office for processing of claims, which is based on Administrative Instruction No. 05/2006. Until now, the Office for Complaints had a considerable number of claims from citizens and the business community. Claims from citizens and working enterprises are checked by the chief of the office, the legal office of the Permanent Secretary and a consultant. Claims are mostly related to discrimination, as the claimants consider that they have not been offered equal opportunities to other groups. Cases are solved by giving responses or advice to the applicants. If the claims are of a too difficult nature so that the Ministry is not capable of resolving them, they are sent to the relevant Municipality or Court. One of the challenges faced by the Ministry is that currently there is only a chief of the office, but no other staff. Based on Administrative Instruction 2006/5 the Ministry of Transport and Post-Telecommunication (MTPT) has appointed responsible officers for working in its Office for Complaints. When the Office receives a complaint, there is an ad-hoc Commission created for review of the complaint. The complaints mostly relate to public transportation, technical control and road infra-structure. In both Ministries the recruitment of staff was either not possible or complicated because of budgetary limitations.

52.The Ministry of Education, Science and Technology has, through Administrative Instruction No. MEST 19/2003, established administrative procedures on appeals issues. Based on the Instruction, the Appeals Commission has been established as part of the Office of the Permanent Secretary and is composed of the Chief Inspector, the Head of the Legal Office and a third member that will vary depending on the nature of the complaint. In cases of alleged discrimination, the Commission investigates the case and responds to the applicant based on legal provisions. If the response is negative, the applicant can address the complaint to the Permanent Secretary within 15 days of receipt. If the applicant again receives a negative response, the person can address the matter to the court. Based on AdministrativeInstruction 2004/4 the Ministry of Local Governance and Administration has established the Legal Department which functions as the Section for Transparency and Claims for Citizens, where claims are received. This Section receives citizens’ claims also through the Ombudsperson Institution and after processing they send them to the relevant municipality for implementation.

53.The Ministry of Culture, Youth and Sports has not yet established the Office for Complaints based on the Administrative Instruction No. 2006/5 for budgetary reasons. At present, any submitted complaint is received by the Human Rights Unit of the Ministry. The Permanent Commission of the Ministry then analyses the claim and brings a decision. If the party is not satisfied with the decision, the person has the right to bring the complaint to the Independent Oversight Board.

Article 3

A. Constitutional and legal framework

54.The principle of equal rights for men and women in Kosovo is established as one of the fundamental rules enshrined in the constitutional and legal framework. The Constitutional Framework guarantees to all persons in Kosovo enjoyment of human rights and fundamental freedoms in full equality and without discrimination on any ground.Furthermore, international instruments that protect human rights and fundamental freedoms are directly applicable in Kosovo through the Constitutional Framework including, among others, the provisions set forth in the Convention on the Elimination of All Forms of Discrimination Against Women.

55.The Provisional Criminal Code of Kosovo (PCCK) sanctions denying or limiting the rights and freedoms of Kosovo residents on the basis of, inter alia, a difference of sex, as well as the granting any privilege or advantage on the basis of such a difference. The prescribed punishment is imprisonment of six months to five years, whereas if the offence is committed by an official person in the exercise of their official duties, the prescribed imprisonment is of one to seven years.

56.The Kosovo Anti-Discrimination Law has been enacted to prevent and combat discrimination, but also to promote effective equality and enforce the principle of equal treatment of persons in Kosovo. Aside from establishing that there shall be no direct or indirect discrimination against any person or persons, based on sex, gender, ethnic origin or nationality, the Law foresees the possibility of undertaking positive actions, such as measures to prevent or compensate for disadvantages.

57.To further equality for women and men, in 2004, the Kosovo Assembly adopted the Law on Gender Equality.

58.The aim of the Law on the Gender Equality is to promote and establish gender equality as a fundamental value for the democratic development of Kosovo society, providing equal opportunities for both female and male participation in the political, economical, cultural and other fields of social life.

59.The Law defines gender equality as equal female and male participation in all relevant fields of social life, equal status, equal opportunities for enjoyment of their rights and equal benefit from the development of society. Equal gender treatment is defined as elimination of all direct and indirect forms of gender-based discrimination.

60.Furthermore, the Law brings a quantitative aspect to the aim to achieve equitable gender representation by increasing balance and parity. The Law calls for the establishment of equal participation of men and women at all levels in executive, legislative and judicial bodies, public institutions, and appointments in central and local government bodies. It is explicitly determined under the Law that equal gender participation of men and women is achieved in cases where the participation of the particular gender in the institutions, bodies or at the level of authority is 40%.

61.The bodies responsible for the achievement of gender equality are: the Kosovo Assembly, Government and ministries, the Gender Equality Unit within the Ombudsperson Institution and local government bodies.

62.In addition, provisions of the Gender Equality Law provide for a set of rules as additional safeguards to ensure equal rights of men and in the areas of employment, education, media and civil rights. The Law also foresees penalties, i.e. fines from 500 up to 20,000 Euro for responsible persons, institutions and other legal entities, in cases of violations of the provisions of the Law.

63.Separate legislation provides for protection against domestic violence, while trafficking in human beings is proscribed as a criminal offence according to the PCCK.

B. Institutional framework

64.The awareness of the need to foster equal rights of men and women, advance the position of women in Kosovo and prevent their marginalisation, resulted in the establishment of several bodies at the level of central and local authorities.

1. Central level

(a)UNMIK Office of Gender Affairs

65.From the outset of its Mission in Kosovo, UNMIK created the Office of Gender Affairs (OGA) to integrate a gender-based approach into the mission. The OGA is responsible for: (1) mainstreaming of a gender equality approach in the monitoring and joint implementation of the Standards for Kosovo, the Standards Implementation Plan, and the European Partnership Priorities; (2) coordination on gender equality issues in UNMIK’s pillars and substantive offices; (3) strengthening of the capacity of the Provisional Institutions of Self Government to address gender issues at the central and local levels; (4) promotion of minority women’s interests and encouragement of cross-cultural understanding and inter-ethnic acceptance; (5) boosting the opportunity of women’s organizations to voice their concerns and articulate their proposals to the highest UNMIK authorities.

(b)Provisional Institutions of Self-Government

66.Following the elections of the Kosovo Assembly in November 2001, the responsibility for a wide range of functions was gradually transferred to elected bodies within the Provisional Institutions of Self Government (PISG). The Law on Gender Equality places the responsibility to establish and promote policies for equal opportunities and to create, approve and execute measures for gender equality, under the competencies of the PISG.

(i) Kosovo Assembly ’ s sub-committee for gender equality

67.The Kosovo Assembly has established a separate sub-committee for gender equality that operates within the Assembly’s Committee for Judicial, Legislative Matters and the Constitutional Framework. The sub-committee for gender equality seeks to ensure gender mainstreaming in the legislative process by assessing the implications for women and men of any proposed legislation and planned actions.

(ii)Agency for Gender Equality

68.The Kosovo Government established the Office for Gender Equality under the auspices of the Prime Minister’s Office, in February 2005. This Office helps incorporate a gender perspective as an integral part of all governmental activities. The working method and internal organisation of the Office were defined in June 2005. Prior to the establishment of the Office for Gender Equality, gender issues were dealt within the Prime Minister’s Advisory Office on Good Governance, Human Rights, Equal Opportunity and Gender, that had been functioning since 2002.

69.The Office for Gender Equality is responsible for bringing the needs of women and men into the policy and decision-making level and for promoting equal values and opportunities irrespective of gender. The Office is the main body responsible for the implementation and monitoring of the implementation of the Gender Equality Law. The Office can propose compilation, alteration and amendment of laws and regulations to the Government and ministries, and other measures for enhancement of gender equality. Furthermore, the Office is liable for drafting policy for the promotion of gender equality and supervising its implementation, as well as for the co-ordination of activities for the implementation of gender regulations. The Office co-operates with non-governmental organisations acting in the field of gender equality and public institutions, and works on increasing gender equality awareness. The Office is funded from the Kosovo Consolidated Budget.

70.Starting from 1 September 2006, by a decision of the Kosovo Government, the Office for Gender Equality has been transformed into the Agency for Gender Equality that operates under the Prime Minister’s Office.

71.In 2005 and 2006, the Office for Gender Equality received 50,000 Euro from the Kosovo budget, while the proposed budget for the Agency for Gender Equality for 2007 is 184,261 Euro.

(iii)Inter-Ministerial Council for Gender Equality

72.In the scope of efforts to advance gender equality, the Kosovo Government has established the Inter-Ministerial Council of Provisional Institutions of Self-Government in February 2006. The Council is established with the aim of “creation of policies and project programs suitable for achievement of gender equality”.The Inter-Ministerial Council for Gender Equality is composed of officers of the Agency for Gender Equality, the Office of Good Governance within the Prime Minister’s Office and gender equality officers in the ministries.

73.The functions of the Inter-Ministerial Council for Gender Equality are: (a) Compilation of policies and strategies for achievement of gender equality; (b) Coordination and supervision of implementation of strategies, policies, programs and projects; and (c) Exchange of information, lobbying and advocating for the achievement of gender equality in Kosovo.

74.The Inter-Ministerial Council co-ordinates activity in policy drafting in order to integrate gender perspectives and compile strategies based on best practices in the region. Co-ordination and supervision of implementation of strategies and policies include their interpretation, with special focus on the drafting of a Kosovo Programme for Gender Equality, as well as the monitoring of progress in the realization of gender equality.

(iv)Gender Equality Unit within the Ombudsperson Institution

75.On 2 July 2004, the Gender Equality Unit was established within the Ombudsperson Institution in Kosovo. The Unit became operational in March 2005. The Gender Equality Unitaddresses issues of discrimination that relate directly to gender. Moreover, the Unit has the responsibility for reviewing draft legislation and commenting on implementation of legislation as it relates to gender issues.The Gender Equality Unit focuses on cases of gender discrimination and attempts to influence policies and processes aimed at the prevention of gender-based human rights violations. Issues dealt with by this Unit have included: domestic violence, gender discrimination in public employment, financial and material support for single mothers, discrimination on the basis of sexual orientation and the rights of married couples to establish residence in Kosovo.

C. Local government bodies

1. Municipal officers for gender equality

76.The Law on Gender Equality also envisages the establishment and promotion of equal opportunities for men and women by governmental bodies at the local level. The law builds upon the structure established by UNMIK Pillar II (Civil Administration) that set up municipal officers for gender equality in September 2002. Municipal officers for gender equality are established in each of Kosovo’s 30 municipalities and since 2003 function as a part of the municipal civil service, under the supervision of the Ministry of Local Government Administration (MLGA).

77.Municipal gender officers ensure application of the Law on Gender Equality at the local level, address gender disparities, foster inclusion of women’s interests in the municipal political agenda and assure integration of a gender perspective in the creation of policies for local governance. The responsibilities of the municipal officers for gender equality include co‑ordination and supervision of all activities related to gender affairs within the municipality, including formulation of programmes to help create a suitable environment for the enjoyment of equal rights within the municipality. Moreover, the municipal gender officers participate in drafting of municipal legislation to ensure conformity of municipal legal acts with the principles of gender rights and equal opportunities.

2. Gender Equality Committees

78.At the local governance level, Gender Equality Committees have been established in 18 municipalities of Kosovo. These committees consist of Municipal Assembly members and civil society representatives. The committees should further enhance integration of a gender perspective at the local level.

D. Mechanisms for the achievement of gender equality

1. The Kosovo Action Plan for the Achievement of Gender Equality

79.The Kosovo Action Plan for the Achievement of Gender Equality was endorsed by the Government of Kosovo in April 2004. The Action Plan serves as a roadmap that promotes the equal participation of women and men in the development of Kosovo. It aims at accelerating the advancement of women in Kosovo and at removing all the obstacles to women’s active participation in all spheres of public and private life. The Action Plan developed strategic objectives and actions to be taken on two levels: within the general context of Kosovo, and on the level of specific critical areas of concern.

80.Strategic objectives addressing the general context of Kosovo are:

Integrate the gender perspective into policies relating to all spheres of society

Generate and disseminate gender-disaggregated data and information

Develop gender responsive budgets

Use a gender requirement and if necessary other positive action to increase the participation of women in decision-making, with the intermediary goal of requiring women in a minimum of 30% of all decision-making positions

Modify the regular workday to designate the hours between 8:00 am and 4:00 pm as regular working hours

Create employment opportunities for members of vulnerable groups

81.Strategic objectives and actions addressing the specific critical areas of concern are:

Integration of Women in the Economy

Increase women’s access to credit

Ensure that women become equal participants in the transformation of public and social enterprises

Promote and support the start-up, development and sustainability of women’s businesses

Human Rights and Violence Against Women and Children

Strengthen institutional mechanisms for the promotion and protection of the human rights of women and children

Raise public awareness of the human rights of women and children, and the causes and consequences of violence against women and children

Support the recovery of victims of violence by ensuring their access to shelters and other appropriate services

Women in Politics

Empower women in all roles and at all levels within political parties

Increase the number of women in politics and in government

Equal Education for Women and Men

Create an educational and social environment that is free of gender-based stereotypes and discrimination, and that promotes equal access to education

Establish innovative programs and services in education, and monitor educational reforms

Health and Social Welfare

Ensure equal access to health care and social welfare services

Promote public education and research on health and social welfare issues relating to women, vulnerable groups and the general population of Kosovo

Culture

Incorporate a gender perspective into all aspects of cultural policies, programs and institutions

Promote a balanced and non-stereotyped portrayal of women and girls in the media and in school textbooks

Take positive measures to provide institutional support to female artists in Kosovo

82.In order to achieve these strategic objectives, a series of actions are required from governmental and non-governmental actors. The Government of Kosovo should create policies aimed at promoting gender equality, by exercising the gender perspective in all decision-making processes, as well as review and modify existing policies. Local NGOs and professional institutions should establish monitoring mechanisms to develop governmental accountability.

83.An additional objective is to ensure effective implementation of the National Action Plan, and to monitor and evaluate progress toward the achievement of its strategic objectives. The Inter-Ministerial Council for Gender Equality is requested to assume this responsibility.

2. The Kosovo Development Strategy

84.The Government of Kosovo developed the Kosovo Development Strategy to determine the direction for achievement of objectives related to economic and social development and fulfilment of European standards. The Strategy triggers the integration of a gender perspective in Kosovo, while the sectoral strategy for gender issues envisages: (a) Integration of Women in Economy; (b) Extension of employment opportunities and social welfare; (c) Obvious improvement of education services; (d) Improvement of health services for women; (e) Increasing of the number of women on decision-making positions; and (f) Improvement of women’s image in media and culture.

E. Specific measures and actions taken

85.The UNMIK Office of Gender Affairs (OGA) has advocated the inclusion of gender equality goals in the Standards for Kosovo, centralizing gender issues within the Kosovo political agenda. This achievement represents an important step for the advancement of the gender equality agenda in Kosovo and led to a number of results including the creation of the Office for Gender Equality in the Prime Minister’s Office, the preparation of the Kosovo Action Plan for the Achievement of Gender Equality, the promulgation of gender sensitive legislation and the integration of gender issues in administrative instructions covering a wide range of governmental sectors. To ensure that gender equality objectives as defined in the Standards for Kosovo are pursued efficiently, OGA has developed specific checklists for ensuring equal opportunities for men and women and the advancement of women in Kosovo. OGA has also participated in the eight Standards Implementation Working Groups - set up as mechanisms for monitoring and joint implementation - by offering technical assistance to ensure that a gender equality approach is used throughout the exercise. Moreover, the OGA has developed a series of gender-sensitive indicators to facilitate monitoring activities. To enhance the capacity of local institutions to fulfil the gender equality objectives in the Standards for Kosovo, OGA has regularly delivered training workshops to all levels of civil servants.

86.In 2006, the OGA in coordination with the Office for Gender Equality in the Prime Minister’s Office, revised the gender equality objectives of the Standards Implementation Plan with the purpose of defining, renewing and expanding commitments for the creation of equal opportunities between men and women to be incorporated into the European Partnership Priorities. Specific actions cross-cutting relevant priorities with indications of responsible actors and deadlines were negotiated with the PISG. This joint effort will guarantee that gender issues are pursued by the Kosovo Government beyond the withdrawal of UNMIK.

87.As part of continued efforts to implement UN Security Council Resolution 1325 (2000) on Women, Peace and Security, the OGA has ensured that the concerns and proposals of women leaders and representatives of local institutions and organizations, including women’s organizations and networks, are voiced to the highest authorities in the UN. In this context, asan initiative of the OGA the practice of quarterly meetings between Kosovo women leaders and the SRSG was established in 2005. These discussions have brought to the table various issues of common interest comprising problems faced by women leaders and women’s organizations for their full participation in the current political process.

88.Since the appointment of the Secretary-General’s Special Envoy for the Future Status Process for Kosovo in 2005, the OGA has been advocating for the inclusion of women representatives in the political talks. In this respect, the OGA has organized meetings between the Special Envoy and Kosovo women leaders in order to create opportunities for women to directly voice their concerns. In addition, the OGA has requested the SRSG to raise this matter with local decision makers, namely the President of Kosovo, the Prime Minister and the presidents of all major political parties. The OGA has moreover advocated with representatives of Member States both in New York and in Kosovo. The OGA has conceptualized and produced the documentary film “Whose security?” focused on the implementation of the UNSCR 1325. The film explores the implications of sustainable peace and security, analyzing how women view these issues differently from men and how current policies often fail to incorporate gender-based perspectives. The documentary has been widely disseminated throughout Kosovo.

89.The OGA has also organized and facilitated a series of tailor-made training activities on gender mainstreaming for the judiciary in cooperation with KIPA.

90.The PISG Agency for Gender Equality (previously Gender Equality Office) has drafted the Strategy on Increasing the Number and Improving the Position of Women in PISG and is in the process of drafting a new plan for achieving gender equality in Kosovo.

91.The Statistical Office of Kosovo, in partnership with UNMIK OGA and the Gender Equality Office, established a long-term strategy to incorporate a gender perspective into the collection and processing of statistical information. As a result, two publications of gender‑disaggregated data “Women and Men in Kosovo”, were produced. These publications, issued in 2003 and 2007, present complete surveys of all available sex-disaggregated statistics in Kosovo.

92.The Gender Equality Unit within the Ombudsperson Institution (OI/GEU), besides dealing with issues of discrimination related directly to gender, carried out general inquiries into certain job vacancy notices and advertised competitions in the public sector as published in the daily newspaper “Koha Ditore” during the period between 1 August 2004 and 31 August 2005, which set gender limitations for potential candidates. The OI/GEU examined whether the use of gender as a mandatory requisite for candidates taking part in employment competitions in the public sector denotes a gender-based discrimination. The OI/GEU found gender limitations in employment competitions unjustified and as such constituting a direct discrimination based on gender. The Ombudsperson accordingly recommended to the Kosovo Assembly to ensure that relevant legal provisions concerning the prohibition of gender-based discrimination in access to employment are implemented properly.

93.Moreover, the OI/GEU held regular meetings with numerous local and international actors to discuss issues of mutual interest, including with the UNMIK OGA, the Office for Gender Equality, representatives of the foreign ministries of various countries, the UNMIK Office for Political Affairs and the UN Special Envoy for Status Negotiations.

94.The OI/GEU worked with representatives of the Ministry of Public Services and the Agency for Gender Equality, and the Office for Good Governance from the Prime Minister’s Office to prepare an action plan for improving the protection of women’s rights in Kosovo. The action plan calls for efforts of the above-mentioned institutions to incorporate the protection of women’s rights into their annual work plans and to organize and conduct training on women’s rights through the Kosovo Institute for Public Administration (KIPA).

95.Training on Gender Equality and Women’s Human Rights has been organized by the OGE for the OGE staff and Gender Equality Officers within PISG ministries. The training is supported by UNIFEM. Trainings on gender equality are being organized by the KIPA for all civil servants, also supported by UNIFEM. The beneficiaries of this training include: Municipal Gender Officers; Gender Equality Committees at the municipal level; the Commission for Gender Equality in the Kosovo Assembly; the Inter-Ministerial Council for Gender Equality; Gender Officers, also known as Gender Focal Points within the ministries, and the OI/GEU.

96.The local NGO, Kosovo Women’s Network (KWN), supported by UNIFEM, has conducted a Kosovo wide legal literacy campaign. The aim was to promote awareness of and access to resources for legal rights and the protection for women. A group of law professionals - known as the Group for Analysis and Studies of Gender Equality (GASGE) has published a legal literacy brochure “Know our rights” in a user-friendly format to further raise awareness in this area.

97.UNIFEM played an active role in facilitating co-operation between women’s NGOs and other sectors of society, for example in building a relationship between the Kosovo Police Service (KPS) and the KWN and in advocating for the inclusion of women’s organizations in a coalition of civil society organizations working on election law reform.

98.In 2004 KWN and youth-organizations conducted a Kosovo wide campaign called “Women Propose” aiming to promote women’s preferences and priorities. As a follow up to this campaign another campaign called “Political Parties Work for Women” was launched. The aim of this campaign was to promote greater and more effective participation of women in elections. Another campaign that has been conducted was the “Go and Vote” campaign that was organized by KWN in October 2004 with the aim to encourage greater voters’ participation.

1. Measures taken in education

99.The current situation in Kosovo in regard to school attendance by female students, shows that female participation is slightly lower than male participation.

100.The drop out rate from learning institutions is higher for female than male students. According to PISG data, the introduction of the 9th grade as the final year of primary education in 2002, has had a negative impact on female school attendance. The 9th grade is not taught in all upper primary schools, thus many students wishing to attend it must travel to a new school. Female students usually drop out after grade eight due to travel constraints. This is especially true in rural areas where the distances between schools are greater. According to the Statistical Office of Kosovo (SOK) data, the drop-out rate for the school year 2003/2004 in primary schools was exceptionally high for girls -81%, compared to 19% for boys. This drop-out rate was more balanced in the year 2004/2005 with 52% for girls and 48% for boys.

Table 5

Number of pupils and students graduated

Pupils and students

2002-2003

2003-2004

2004-2005

Women

Men

Women

Men

Women

Men

Total

23 900

27 960

20 448

27 424

22 463

25 156

Pupils basic 9 years education

15 163

16 768

9 726

15 921

13 861

17 716

Licensed secondary education

7 543

9 763

9 297

9 915

8 602

8 440

Graduated at University

1 194

1 429

1 425

1 588

-

-

In %

46

54

43

57

46

54

Source: Statistical Office of Kosovo (SOK), Education Statistics.

101.Activities taken by the Ministry of Education, Science and Technology (MEST)/Office for Gender Equality, to raise public awareness of importance of education of woman and to improve gender equality in Kosovo, are as follows:

MEST, in co-operation with Canadian Education Development Program (CEDP), has organised three one-day symposiums on equal opportunities, in the period 2002-2005. The annual symposiums involved around 250 participants (education officials, school principals, teachers, parents, and pupils) from all Kosovo municipalities. Discussed subjects covered gender issues, human rights, and rights of disabled persons.

MEST in co-operation with CRS and Parents-Teachers Association (PTA) is carrying out a project on “Preventing girls from leaving schools”.

Gender issues are included as a part of the curricula for compulsory education.

MEST, supported by UNICEF, has incorporated a topic called “Skills for life” as an elective subject for the eighth grade classes at the primary level. Specific curricula, books and teachers have being made available for pupils. Within this programme, one of the modules is “what are the stereotypes and gender roles” and several other modules (how to keep violence out of my life, personal health care, what is the trafficking in human beings, what is the sexuality, etc). The subject is being piloted in 30 primary schools and after the monitoring and assessment will be expanded to cover 100 other schools.

MEST in co-operation with CEDP, has built gender training capacities (gender trainers). These trainers cover 7 regions (Prishtinë/Priština, Mitrovicë/Mitrovica, Pejë/Peć, Gjakovë/Đakovica, Ferizaj/Uroševac, Prizren, Gjilan/Gnjilane).

During 2005, 270 teachers from primary and secondary schools, including from minority communities, were trained on gender issues in education.

On 2002-2003, a project on “gender issues, human rights, and democracy in education” was implemented. The purpose of this project was to educate the community on gender issues and human rights by effecting directly education and education institutions. There were 38 participants trained, from various backgrounds and from all Kosovo communities and municipalities.

MEST, in co-operation with CEDP, has published two manuals on gender issues in education, one of which for use by gender trainers and the other for those participating in such trainings.

MEST, in co-operation with UNICEF, in 2004-2005, carried out research on “Education of Girls” with the focus on identifying reasons why girls in Kosovo actually drop out of school.

Round table discussions were held in 2004, covering topics related to gender issues in education such as school abandonment, particularly by girls.

The document “Gender Reflection in Education” was prepared by UNICEF in co‑operation with MEST. This document contains a summary about female education in Kosovo and was completed in 2002-2003.

In 2005, a working group was established to cover gender issues in higher education. The working group is composed of University of Prishtinë/Priština representatives and MEST representative.

A gender strategy on education has been completed by the PISG; an action plan has yet to be drafted and attached to this strategy.

F. Domestic violence

102.Prior to 2003, domestic violence was not defined in legislation as an offence. Domestic violence was often confused with an issuer regarding a violation of public peace and order and sanctioned as a minor offence. Domestic violence was prosecuted only if the victim suffered bodily injuries.

103.UNMIK Regulation No. 2003/12 On Protection against Domestic Violence, defines domestic violence as “one or more of the following intentional acts or omissions when committed by a person against another person with whom he or she is, or has been, in a domestic relationship: (a) Inflicting bodily injury; (b) Non-consensual sexual acts or sexual exploitation;(c) Causing the other person to fear for his or her physical, emotional or economic well-being; (d) Kidnapping; (e) Causing property damage; (f) Unlawfully limiting the freedom of movement of the other person; (g) Forcibly entering the property of the other person; (h) Forcibly removing the other person from a common residence; (i) Prohibiting the other person from entering or leaving a common residence; or (j) Engaging in a pattern of conduct with the intent to degrade the other person.”

104.Under the UNMIK Regulation on Protection against Domestic Violence, a series of measures are available to protect victims of domestic violence. The court can issue protection orders, emergency protection orders and interim emergency protection orders to protect persons subjected to domestic violence. In 2005, the new Law on Social and Family Services further articulated services available to victims of domestic violence. Under this Law, victims of domestic violence fall into the category of persons in need, while Centres for Social Work are responsible for providing social protection on the municipal level, in collaboration with local NGOs. In addition, the Provisional Criminal Procedural Code of Kosovo (PCPCK) gives the authority to the Victim Advocacy and Assistance Unit (VAAU) of the Ministry of Justice to act as authorized representative of vulnerable victims, including victims of domestic violence, through the provision of legal guidance and assistance.

105.According to the statistics of the Ministry of Justice, 341 cases of domestic violence were reported to victim advocates in 2006. In 2005, this number was 592, in 2004, 414 while in 2003, there were 314 victims of domestic violence who required the assistance of victims’ advocates. The type of assistance provided depended on the victims’ individual needs. The assistance available includes shelter, psycho-social support, legal aid and legal representation, marital counselling (provided by Centres for Social Work), vocational training for victims, and child care programs for their children, provided by NGOs.

106.The Centre for Protection of Women and Children, a local NGO, received 3,650 requests for assistance from victims of violence during 2005, and 4,700 in 2006. Through October 2006, UNMIK victim advocates were involved in 1,468 domestic violence cases. The judicial system processed 77 protection orders from January to October 2006; authorities arrested 341 persons, resulting in the opening of 1,045 cases. A total of 52 of the 53 cases completed resulted in convictions, with sentences ranging from judicial reprimands to imprisonment. However, traditional social attitudes towards women in Kosovo male-dominated society contributed to the high level of domestic abuse and a low number of reported cases.

107.Currently, four shelters assist victims of domestic violence and trafficking, two run by local NGOs and two by international NGOs. The Kosovo Police Service (KPS) reported that 66 victims of domestic violence received shelter during 2006. Several domestic and international NGOs pursued activities to assist women; however, many incidents are not reported due to a tradition of silence about domestic- and gender-based violence. Therefore, in 2006 an anonymous hotline to report domestic abuse was also established. In addition, the KPS training school offered special courses on domestic violence and rape in its curriculum.

108.In addition, representatives of the Ombudsperson Institution (OI) monitored whether the municipal courts in Kosovo complied with the time limits required by the UNMIK Regulation on Protection against Domestic Violence. Under the Regulation, the court shall decide on a petition for a protection order within 15 days of receipt, while in cases of petition for an emergency protection order the court shall decide within 24 hours of the petition being filed.Municipal courts in nine major Kosovo municipalities were monitored in the period between March and November 2006. The OI found that of the cases under investigation, the time limit outlined in the Regulation was not adhered to in a single case. The Ombudsperson thus concluded that the municipal courts in question have not been fulfilling their obligation to protect victims of domestic violence in line with the applicable law, and accordingly recommended that the presidents of municipal courts should ensure that the cases of domestic violence are given priority. Moreover, it was recommended to the Kosovo Judicial Council to, as soon as possible, nominate a sufficient number of judges to deal with cases of domestic violence, following prior training on domestic violence issues.

109.Besides creating new legislation giving more protection to the victims of domestic violence, UNMIK has, in cooperation with local institutions, organized a number of information campaigns to raise awareness against domestic violence. The OGA produced a public awareness campaign to combat violence against women that was conceptualized on the basis of a qualitative research study on adolescents’ perceptions of gender-based violence carried out by the OGA, in collaboration with a local research institute. The campaign addressed new generations and calls on their direct responsibility to break the cycle of violence that restrains women’s individual and collective advancement. The campaign was broadcast by the public Radio Television of Kosovo.

110.The OSCE/Pillar III, together with local municipal authorities, has organized interactive training sessions for Kosovo youth on how to recognize violent relationships, how to protect themselves and seek help. Dates such as November 25th have been utilized for raising awareness regarding violence against women across Kosovo. There have also beennumerous educational sessions organized for police, judiciary and the social service sector on new legislation. No comprehensive evaluation has been conducted as of yet to examine the effectiveness of the anti-domestic violence mechanisms. Nevertheless, the increase of reported cases of violence indicates that each year more and more women ask for protection.

G. Trafficking inhuman beings

111.The Victim Advocacy and Assistance Unit of the Ministry of Justice reported 35 cases of trafficking identified in the year 2006. In 2005 this Unit was called in to deal with 32 cases, out of which 28% were cases where the victims were children.

112.According to the information received by the Ministry of Justice, in 2005, 38 persons had been charged with trafficking in human beings, but only 17 had been convicted for trafficking while two persons had been acquitted. In the majority of cases the defendants were sentenced from five months to three years’ imprisonment. However, in one case five accused were sentenced from one year to 12 years’ imprisonment. Thus the sentences pronounced by the courts by the end of 2005 ranged from six months to 12 years, with the majority being between five months and three years. In 2006, five cases of trafficking were filed with the courts; 15 cases were pending; 38 persons had been charged with trafficking, which resulted only in two convictions from six months to eight months of imprisonment. Although the PCCK provides for very serious punitive measures for those involved in trafficking, prosecutors and courts often resort to minimal charges and subsequent convictions for facilitation of prostitution, instead of opting for charges on trafficking.

113.For more information in relation to trafficking in human beings, please see the information provided under Article 8, paras. 27-34, of the Report submitted by the United Nations Interim Administration Mission in Kosovo to the Human Rights Committee on the human rights situation in Kosovo since June 1999, CCPR/C/UNK/1 of 13 March 2006.

Article 4

114.Inasmuch as CFK Chapter 3.2(a)-(c) and 3.3 make the UDHR, ECHR and ICCPR directly applicable, the provisions of those international instruments restricting the exercise of ICESC-related rights, “as are determined by law solely for the purpose of securing due recognition and respect for the rights and freedoms of others and of meeting the just requirements of morality, [health,] public order and the general welfare in a democratic society”, likewise apply. ADL, Article 12.2 only permits such restrictions on the rights to work, vocational training, safe working conditions, join and form trade unions, social protection, health, education and housing as “the purpose[s] for which they have been prescribed”.

115.However, none of the UNMIK Regulations/Kosovo Assembly Laws which govern the rights to work, vocational training, occupational safety, social protection, health and education, that are discussed below in Sections VI-VII, IX and XII-XIII of this Report, contain any provisions restricting their exercise in the interests of the public health, safety or morals of Kosovo’s democratic society. Section 3.1 of UNMIK Regulation 2001/27, 8 October 2001, on Essential Labour Law in Kosovo (Essential Labour Law) likewise does not expressly prescribe any comparable limitations on employees’ and employers’ rights to establish and join organisations of their own choosing without prior authorisation, its Section 5.4 requiring public authorities to refrain from interference “that would restrict the exercise of [these] rights.” The latter notwithstanding, Section 5.8 of the Essential Labour Law subsumes the enjoyment of the right to organise under that regulation to the “directly applicable law in Kosovo” viz. The restrictions permitted under ECHR, Article 11(2) and ICCPR, Article 22(2) mirroring those of UDHR, Article 29(2) quoted above.

Article 5

A. Abuse of rights

116.CFK, Chapters 3.3 and 14.1 incorporate UDHR, Article 30, ECHR, Article 17 and ICCPR, Article 5(1) - all of which prohibit any interpretation destructive or excessively restrictive of the rights recognised under those instruments by any government, group or person - as part of the constitutional framework, with primacy over any conflicting Assembly law.

117.This UDHR, ECHR and ICCPR prohibition of the abuse of rights is re-iterated in ADL, Article 12(1). In Addition, Article 158 (Violating Equal Status of Residents of Kosovo) of UNMIK Regulation No. 2003/35, 6 July 2003, Provisional Criminal Code of Kosovo (PCCK) makes it a general criminal offence punishable by imprisonment of six months to five years “unlawfully [to] den[y] or limit[.] the freedoms or rights of a resident of Kosovo as set forth in the Constitutional Framework and the applicable law, on [any of] the [proscribed] bas[e]sof [discrimination].” Articles 182-183 and 185 of the PCCK specifically penalise any prohibited form of denial or restriction of “rights in labour relations,” “rights of employment and unemployment” and “social insurance rights” with a fine or imprisonment of up to one year. The precise nature of those proscriptions is discussed in Sections VI (A), VII (A),(D) and IX below.

B. The principle of the primacy of more favourable rights

118.The incorporation of ICCPR, Article 5(2) by the CFK directly applies the primacy of more favourable rights congruent to the ICCPR and ICESCR (viz. the basic principles of non‑discrimination and gender equality as well as the rights to work, unionise, family, marry and child protection) “pursuant to law, conventions, regulations or custom”.

119.Inasmuch as Section 1.1(b) of the Directly Applicable Regulation as amended continues pre-March 1989 law in effect throughout Kosovo until such time as repealed by UNMIK Regulations, those international treaties - such as the Conventions of the International Labour Organisation (ILO) - which were promulgated by the Socialist Federal Republic of Yugoslavia (SFRY) are directly applicable by the courts - especially if they are more protective of workers’, family and children’s rights. Exceptionally, courts may also apply such international human rights instruments together with non-discriminatory laws, which are consonant with the international treaties listed in the discussion of ICESCR, Article 2(1) above, that were promulgated after March 1989 in the absence of otherwise directly applicable law, pursuant to Directly Applicable Law Regulation, Section 1.2, as amended. They “may request clarification from the Special Representative of the Secretary-General in connection with the implementation of the Regulation[‘s provisions]” - and consequently the application of international human rights conventions and non-discriminatory laws - when adjudicating rights and obligations in accordance with ICCPR, Article 14(1) and CFK, Chapter 9.4.3. The omnibus provisions contained in all laws adopted by the Kosovo Assembly and UNMIK Regulations to the effect that a given law supersedes all previous laws on the same subject matter call for similar elucidation.

120.One such clarification was sought by the President of the Special Chamber of the Supreme Court of Kosovo on Kosovo Trust Agency Related Matters (KTA Special Chamber) on the implementation of Section 10.6(b) of UNMIK Regulation No. 2003/13, 9 May 2003, on The Transformation of the Right of Use to Socially Owned Immoveable Property (SOE Property Regulation) in 2004, bearing in mind its apparent inconsistency with the ADL - which had been promulgated that year - and the jurisprudence of the European Court of Human Rights (ECtHR). That provision requires “[a]ny complaint filed with the Special Chamber on the grounds of discrimination as reason for being excluded from the list of eligible employees [to a share of the proceeds from privatisation on a priority basis) . to be accompanied by documentary evidence”. Responding in 2005, the SRSG advised that the KTA Special Chambershould apply the ICCPR-Article 5(2) primacy of more favourable rights to such immoveable property claims of discrimination and shift the burden of proof in those cases to the KTA, as the respondent, consistent with Article 8.1 of the ADL. The KTA Special Chamber has amended its rules of evidence accordingly, construing Section 10.6 of the SOE Property Regulation to call on complainants to establish a prima facie case of discrimination and the KTA “to prove that there has been no breach of the principle of equal treatment”.

121.Article 11(2) of the ADL itself also emulates the principle of the primacy of More Favourable Rights, requiring “[t]he provisions of the legislation introduced or into force for the protection of the principle of equal treatment . [to] be applied if they are more favourable than provisions in this Law”.

122.Because the PISG is concerned about how best to determine legal certainty and human‑rights conformity of directly applicable pre and post 1989 law and the lawsuperseding it as well as the primacy of more favourable rights during the transitionalperiod and thereafter, it requested the OHCHR to provide technical assistance withthe conduct of a comprehensive legislative review during the presentation of the Report Submitted by the United Nations Interim Administration Mission in Kosovo to the Human Rights Committee on the Human Rights Situation in Kosovo Since June 1999 in July 2006.

Article 6

A. Legislative framework

123.UNMIK and the PISG have introduced important legislative measures to protect the right to work, as guaranteed under Article 6 of the ICESCR.The main legal acts by means of which the right to work is regulated in Kosovo are the following:

UNMIK Regulation No. 2001/27 On Essential Labour Law in Kosovo of 8 October 2001

UNMIK Regulation No. 2001/36 On the Kosovo Civil Service of 22 December 2001, as amended by UNMIK Regulation No. 2006/20

Law No. 2002/9 On the Labour Inspectorate of Kosovo, promulgated by UNMIK Regulation No. 2003/4 of 21 February 2003

Law No. 2003/19 On Occupational Safety, Health and the Working Environment, promulgated by UNMIK Regulation No. 2003/33 of6 November 2003

Law No. 02/L-42 On Vocational Education and Training, promulgated by UNMIK Regulation No. 2006/24 of 25 April 2006

124.Other important legal and policy instruments by means of which the right to work and its progressive implementation is realised include:

General Collective Agreement (GCA) between the Union of Independent Trade Unions of Kosovo (BSPK), the Ministry of Labour and Social Welfare (MLSW) and the Chamber of Commerce of Kosovo, of September 2004

Strategy for the Increase of the Number and Position of Women in PISG 2006-2015 approved by the Kosovo Government, and

Kosovo Youth Employment Action Plan, A mid-term policy framework, 2006-2009

1. Labour law and legislation

(a)General

125.Labour relations in Kosovo are mainly governed by UNMIK Regulation No. 2001/27 On Essential Labour Law in Kosovo (the Essential Labour Law). The purpose of the regulation is to set out the essential labour law in Kosovo and to regulate employment in Kosovo. It proscribes discrimination at the workplace as well as sexual harassment in the working place. While the general minimum age for employment is 18 years, a younger person can be employed in light work not harmful to his or her health. It is prohibited to employ anyone under 15 years of age.

126.A labour contract may be concluded for an indefinite or a definite period in an official language used in Kosovo. A termination of the labour contract may happen upon the death of the employee, by a written agreement between the employee and employer, on grounds of serious misconduct by the employee, and following the expiration of the contract. Salary shall be equal for women and men and payable at least every month, through bank transfer with an accompanying pay slip. Working hours shall not exceed 40 hours per week, a working day shall not exceed 12 hours, whereas in the transport sector, the working day for drivers shall not exceed 9 hours.

127.The legislator has also foreseen a 30 minute unpaid break during a working day, one day off during the working week and that overtime shall be paid at a rate of an additional 20% per hour and not exceed 20 hours per week and 40 hours per month. Persons younger than 18 shall not be permitted to work over 40 hours per week, and these persons as well as pregnant women shall not be permitted to work at night, i.e. between the hours of 22:00 and 05:00.

128.Every employee shall be entitled to paid annual leave of at least 18 working days during the calendar year. Additional leave is foreseen for certain family matters. In case of sick leave the employee shall notify the employer within 48 hours. If it is a result of a work related accident or illness, the employee shall be entitled to the salary for that period. There are penalties foreseen in case of violations or non-implementation of the law.

(b)Specifics in the mining sector

129.Working hours for employees in mines are determined by article 16.7 of the Essential Labour Law according to which the working day in the mineral sector for those working underground shall not last longer than 8 hours. The minimum age to work in mines is 18 years. The Ministry of Energy and Mines (MEM) has in 2006 prepared a draft Law for security and health of employees in the mine sector, which has passed the phase of ministerial discussion and is going to be sent to the Government.

130.The responsible body for the inspection of mines is the inspectorate of the Independent Commission for Mines and Minerals (ICMM), whose competencies and responsibilities are set out by UNMIK Regulation No. 2005/2 On the Establishment of the Independent Commission for Mines and Minerals of 21 January 2005. In the future, once the Law on Mines and Minerals, approved by the Kosovo Assembly on 19 January 2006, has been promulgated, the issue of mines inspection will be passed to the inspectorate of the MEM.

(c)Vocational education and training

131.See under Article 13 of this report for a discussion on vocational education and training.

B. Establishment of a functioning market economy

132.Following the end of the conflict, the economy of Kosovo was in a state of collapse. UNMIK was mandated by the UN Security Council to support the reconstruction of key infrastructure and other economic and social systems in order to promote peace and prosperity in Kosovo and to facilitate the development of an economic life that brings better prospects for the future.

1. State of employment and economic organization

133.At the time of UNMIK’s arrival in 1999, Kosovo’s economy was devastated. Socialist‑style institutions had disintegrated. Kosovo lacked the institutional and administrative capacity to govern and support its economy. There were no banks. There was no authority to conduct fiscal policy: no one to collect taxes or manage public revenues. There was virtually no official employment. The agricultural sector was destroyed to the point where even subsistence farming had ceased. Kosovo depended almost entirely on foreign aid provided by the Kosovo diaspora and the international donor community. The tasks of rebuilding physical and institutional infrastructure and transforming Kosovo into a market economy had to be carried out simultaneously.

134.The change in the state of the economy from 1999 to 2006 has been profound. Despite a vast number of obstacles, UNMIK - and increasingly the PISG - have successfully completed a large number of economic reforms. Today, Kosovo has the main building blocks of a market economy, including essential institutional and legal infrastructure, macroeconomic stability, a financial system, and a stable fiscal sector many aspects of which surpass those in developed countries.

135.All the same, Kosovo’s agriculture, industry, mining, and service sectors have not undergone substantial development. Economic transition is an intrinsically challenging process. Given its experience of conflict as well as its economic legacy (Kosovo was once the poorest region of the former Yugoslavia), Kosovo’s economic transition has been even more so. The significant amount of investment that is necessary to revive these sectors can only be expected once a business environment that provides adequate incentives to investors has been established. This kind of business environment has been taking shape. Kosovo’s relatively low taxes, macroeconomic stability, and a growing number of institutions whose capacity to support private sector development is on the rise, are important aspects thereof.

2. Reducing unemployment

136.One of UNMIK’s key objectives has been to facilitate the development of a sustainable market economy in Kosovo. Significant resources and institutional instruments have been deployed to achieve this objective, including the establishment of UNMIK’s Economic Reconstruction Pillar (Pillar IV) whose mandate is geared towards modernising the economic framework of Kosovo so as to develop the structures and instruments that form the basis of a modern market economy. By taking on roles in external economic affairs, privatisation, customs, financial system regulation and supervision, fiscal affairs, market regulation, and by assisting the development of Kosovo’s own institutions to manage economic affairs, Pillar IV has been the instrumental driver of Kosovo’s economic transformation. The successful economic reconstruction and transformation ensures an economic, business and entrepreneurial environment that is increasingly contributing to the generation of employment in Kosovo.

137.Kosovo now has the key elements of a legal framework that is needed to support the development of a market economy. Laws have been adopted to enable the institution and protection of property rights as well as to regulate business registration and the conduct of business activities. From the perspective of a potential investor, it should be noted that the current legal and institutional system allows for a company to be registered rather quickly, while most taxes in Kosovo are relatively low for the region. Legislation enables Kosovo to import many raw materials and machinery duty- and VAT free, and to export without having to pay export taxes.

138.Furthermore, investors are protected under Kosovo’s Law on Foreign Investment, which rules out any discrimination and stipulates unimpeded repatriation of profits. Other benefits include macroeconomic stability, one pillar of which has been the adoption of the Euro as Kosovo’s legal tender. The Euro precludes inflationary monetary policies and eliminates currency risk, thus contributing to investor confidence. A balanced and sustainable fiscal regime has also been developed. The PISG runs a balanced budget, now predominantly funded from tax revenues. The financial sector includes seven commercial banks plus the Central Banking Authority of Kosovo (CBAK). The sector is well regulated and relatively competitive.

139.UNMIK and the PISG have also achieved significant progress in integrating Kosovo into regional and wider economic institutions and initiatives. Following the signing of several bilateral free-trade agreements with regional neighbours, Kosovo has recently acceded to the enlarged Central European Free Trade Agreement (CEFTA). The inclusion of Kosovo into CEFTA, combined with unilateral duty-free access for Kosovo goods into the markets of the European Union, render Kosovo a part of the “pan-European duty free market” - an advantage for any potential exporter. Furthermore, UNMIK on behalf of Kosovo has acceded to the South East Europe Energy Treaty, which should facilitate the future development of Kosovo’s energy sector. UNMIK on behalf of Kosovo has also acceded to the European Common Aviation Area(creating a single market for commercial flights in Europe), is part of the South Europe Transport Observatory (facilitating the development of a regional transport network), and is an active participant in the European Charter for Small Enterprises Western Balkans + Moldova forum.

140.The process of developing a business-friendly environment in Kosovo has been a challenging one. The inclusion of Kosovo into regional economic initiatives and other international economic institutions, for example, was made difficult by Kosovo’s undefined status, even as UNMIK found legal solutions to overcome this obstacle in most cases. Furthermore, the process of building the capacity of Kosovo’s fledgling institutions has been made more difficult by the legacy of Kosovo’s poor education system. Improving the quality of formal education must become a priority of future local and international institutions.

3. Post and Telecommunications

141.On 21 December 2006, the Post and Telecommunications of Kosovo (PTK) celebrated its 47th anniversary - it had originally been established as the Post, Telephone and Telegraph of Kosovo by a decision of the Steering Council of Yugoslavian PTT Communion in 1959. During the conflict of 1999, many of the PTK’s assets were stolen or damaged, and a number of its premises demolished. Postal services had ceased, while Telephony and Telegraphy within Kosovo as well as international connections were all but inoperative.

142.Six years later, PTK has been fully revived through a combination of donor funding (EAR), private sector loans, and own-source revenue, and now has three business units: Post of Kosovo, Telecom of Kosovo, and the Vala mobile network operator - all licensed by the Kosovo Telecommunications Regulatory Authority (TRA). A Training and Development Centre was established in September 2004 to support the professional development of PTK staff. PTK currently has 2,410 regular employees and 66 external contractors. Today, 99% of the territory of Kosovo has mobile phone coverage, while 90% of urban and 25% of rural areas have landline telephony.

143.On 29 June 2005, under the guidance of the Kosovo Trust Agency (KTA), the PTK was incorporated and transformed into a joint-stock-company. It now has a five year business plan (2007-2012) with projected investments of some 550 million Euro. In July 2005, the PTK launched its website (www.ptkonline.com) in order to facilitate information sharing with customers.

144.A significant problem faced by the PTK is that Kosovo currently does not have its own dialling code. Under the existing regime, the PTK uses the International Dialling Code of Serbia (+381) for its fixed line network, and the Monaco International Dialling Code (+377) for its mobile network, thus incurring a significant financial loss. In January 2005, the managementof PTK approached the International Telecommunications Union (ITU) with a request for an International Dialling code for Kosovo. A formal application for an International Dialling Code for Kosovo has since been placed with the ITU. However, the potential allocation of an International Dialling Code for Kosovo has not yet been resolved.

145.In November 2006, the Government of Kosovo launched a tender for a second mobile phone operator for Kosovo. A previous tender prepared by the MTC and administered by the Telecommunications Regulatory Authority (TRA) in the year 2004 was declared null and void that same year by SRSG Executive Decision 2004/25 due to a flawed tender process. By February 2007, a selection of a second provider has been made and subsequently a second mobile telephony services license had been issued.

4. Central Banking Authority of Kosovo

(a)Framework, organization and authorities

146.The Central Banking Authority of Kosovo (CBAK) - formerly the Banking and Payments Authority of Kosovo (BPK), as per the Constitutional Framework - is an independent body governed by a Governing Board and accountable to the SRSG. The role of the CBAK is to foster the development of financial and payment systems in Kosovo. It supervises and regulates Kosovo’s banking sector, insurance industry, pension funds, and other micro finance institutions, and performs a number of other tasks normally undertaken by a central bank. These include cash management, transfers, clearing, management of funds deposited by the Treasury or other public institutions, collection of financial data, and the management of a credit register. The CBAK, however, is not authorised to grant any loans, including liquidity, to banks.

147.The CBAK has an international Managing Director and two Kosovo Deputies. According to UNMIK Regulation No. 2006/47 On the Central Banking Authority of Kosovo, the Governing Board of CBAK consists of five members: three nominated by UNMIK, two nominated by the PISG, and all appointed by the SRSG. The CBAK has put in place a modern managerial structure, which includes an Executive Committee, a Supervision Committee and a Training Committee. The CBAK has also implemented an impartial and transparent recruitment process. The CBAK has also made strong efforts to increase the participation of minorities in its personnel structure through aggressive advertising. Minorities’ participation currently stands at 4.7% of CBAK staff.

(b)Establishment of sound financial institutions

148.Since its inception, the CBAK has developed a framework of supervisory rules and policies to implement its mandate. Each segment of the financial system is governed by a framework of prudential rules that regulate entry into the system and the conduct of business within it. These include the usual prudential requirements concerning ownership, capital adequacy, liquidity, audit, and the management of various financial and operational risks. These rules are, for the most part, consistent with Basel Guidelines and EU/EC requirements. The CBAK regularly monitors compliance by-, as well as the overall condition of-, financial institutions through onsite inspections and offsite analysis of reported financial data.

149.Moreover, the CBAK has implemented a variety of punitive and remedial measures to resolve issues of non-compliance or inordinate risk. In one case, the CBAK revoked the license of a bank and several insurance companies. Pension funds, microfinance institutions, and other non-bank financial entities are similarly supervised. The CBAK, with the help of donors, has dedicated a significant amount of time and money in the training and development of its supervisory staff in order to be able to implement a sound supervisory regime. Finally, the CBAK has promoted competition and a greater supply of financial services by supporting viable and experienced new actors in the financial sector.

(c)The role of BPK/CBAK since its establishment

150.The role of the CBAK has remained unchanged since its establishment. Its mission is to protect primarily depositors/clients, as well as other stakeholders, and to maintain stability in the financial sector. The CBAK does so in line with its strategic vision of a stable and growing financial sector driven by market forces, but operating within a prudent regulatory and supervisory policy framework harmonised with EU/EC directives. This vision implies the establishment of sound entry standards, transparency of operations, viable participants capable of assessing and managing business risks, maintenance of adequate financial and human capital to support business activities, and the efficient resolution of financial sector problems in a manner that is least disruptive.

151.The manner in which the CBAK has implemented its role has, however, evolved consistent with the evolution of international best practice for supervisors. Namely, the CBAK has moved from a “rules-based” approach to a “risk-based” approach (formulated on the basis of the Basel Core Principles and Pillar 2 of Basel II for banks) and a risk-based solvency regime that is being adopted internationally for insurance companies. Rather than simply monitoring actors’ compliance with a set of rules, the risk‑based approach constitutes a comprehensive qualitative assessment of financial institutions’ internal systems and processes for identifying, monitoring, and controlling theirown risks. A risk-based regime means that financial institutions are expected to adopt “best practice” methodologies in order to manage their activities and the risks inherent therein.

(d)Employment levels in the banking and insurance sector

152.In 2006, the total number of employees in the banking sector (six banks) was 2.416. The total number of employees in the insurance industry (nine companies) was 596. CBAK does not have an ethnicity/gender breakdown or employment figures per year.

(e)Economic figures

153.As of 31 December 2006, the total number of depositors in the six banks was 770,392. As of 31 December 2006, the total amount of loans disbursed by commercial banks was 610,016,000 Euro distributed as follows:

Table 6

Loans disbursed by commercial banks asat 31 December 2006

Personal Loans

145 412 000 Euro

Commercial Loans

264 643 000 Euro

Mortgages

32 081 000 Euro

Other loans

167 880 000 Euro

Source: Central Banking Authority of Kosovo.

(f)Closure of Credit Bank of Pristina

154.Following the license revocation of the Credit Bank of Pristina (CBP) on 13 March 2006, the Receiver rapidly performed two waves of payments to the depositors: the first wave for deposits of up to 1,000 Euro, and the second for deposits of up to 2,500 Euro. Following these two waves of payments, 89.45% of all depositors were entirely refunded. The Receiver continued to make additional payments that partially reimbursed the remaining depositors.

155.The CBAK and the Receiver have emphasised that the amount of the remaining payments would depend on the capacity, or willingness, of those who borrowed money from the former CBP to pay back their loans. Based on the present expectation of loan recoveries, the Receiver foresees a good possibility to refund the remaining depositors up to 70% of their deposits during the course of the Receivership. Quicker payments, at a higher payment rate (above 70%), or even full payment could be achieved if borrowers paid back their loans in full.

156.As the Receiver collects sufficient funds, the repayment process will be performed in several waves in order to cover 70% of the deposits, with a repayment ceiling of 20,000 Euro. Once all remaining account holders have received up to 20,000 Euro, the Receiver will cover progressively, and on a pro-rata basis, all depositors up to 70% of their deposits. When all depositors are paid up to 70% of their deposits, additional payments may be performed by the Receiver, on a pro-rata basis, and based on the amount of loans recovered.

5. Kosovo Railways

157.Following the conflict of 1999, the former “Railway Organization Prishtina (ROP)” came under the responsibility of UNMIK and was renamed UNMIK Railways. At this time, the railway infrastructure, as well as the rolling stock (locomotives, passenger wagons, etc.), was largely destroyed or damaged, and, with regard to the latter, had partly been taken to Serbia proper.

158.With the support of UNMIK, Italian KFOR, and donations from SIDA, GTZ, the EAR, and others, UNMIK Railways began repairing the railway infrastructure in 1999 and initially resumed railway traffic for KFOR needs on the line Fushë Kosovë/Kosovo Polje - Skopje. This same line was opened for passenger traffic in February 2006. After the establishment of the Kosovo Trust Agency (KTA), UNMIK Railways, as all other Publicly Owned Enterprises (POE), came under the authority of the KTA, and was incorporated as Kosovo Railways J.S.C, in January 2006.

159.Between 1999 and 2006, Kosovo Railways managed to repair its railway infrastructure and rolling stock to a satisfactory level, which today enables the company to operate daily passenger and freight trains, especially on the main railway line Lešak/Leshak - Mitrovicë/Mitrovica - Fushë Kosovë/Kosovo Polje -Hani Elezit/ Đeneral Janković. Today, Kosovo Railways is either a member or an observer of a number of railway organizations and working groups within the region and beyond, including the International Community of Railways (member), the South East European Transport Observatory (member), and the Community European Railways (observer).

160.The following capital projects were completed with the help of donor funding:

Repair of damaged railway tracks

Repair and limited modernisation of signalling equipments on the north/south line

Repair of telecommunications equipment and installation of a railwayradio system

Repair of buildings in the locomotive and wagon workshops

Repair of a number of signalling buildings

Supply of ten locomotives

Supply of ten passenger wagons

Supply of one manoeuvring locomotive, and

Supply of three motor trains

161.The KTA also invested efforts in developing the human resources of Kosovo Railways. This was achieved through various training programmes, the engagement of foreign experts etc. At the same time, UNMIK on behalf of Kosovo signed agreements on the development of railway traffic with Serbia (March 2002) and FYROM (August 2005). In June 2006, Kosovo Railways got a Kosovo Managing Director.

6. Pristina International Airport

162.Given the geographical situation of Kosovo, aggravated by its undefined political status, the establishment of a well-functioning international civil aviation facility is of crucial importance to the economic development of Kosovo. A Publicly Owned Enterprise (POE), Pristina International Airport is under the administrative mandate of the Kosovo Trust Agency (KTA). During the early seventies and early nineties, the Airport, formally in use by the military, was also permitted to develop some commercial traffic. A terminal building, relatively small by today’s standards, was constructed, and a separate company known as PEAP allowed to run and control it. The rest of the Airport’s operation was mainly controlled by the military. The two sections of the airport had little to do with each other. Revenue grew on the PEAP side as they had little in the way of overheads apart from staffing costs, while the part controlled by the military went into decline along with the rest of the Airport operation. At the end of the conflict in 1999, the Airport could not continue under its established structure. KFOR took over its operational management and provided the necessary staff to look after its operations. UNMIK took over civilian control of the Airport on 1 April 2004.

163.Though significant infrastructural, security, and human resources developments have taken place at the Airport since 1999, the Airport still does not have international certification. Efforts are ongoing to bring the Airport up to the international standards prescribed by the International Civil Aviation Organisation (ICAO), with the help of the Icelandic Civil Aviation Authority (ICAA) which has “adopted” Pristina International Airport for this purpose (the “adoption” was necessary as Kosovo itself, not being a sovereign state, cannot certify the airport), and has, inthe meantime, issued the Airport with an “Interim Declaration of Fitness” enabling it to continue its operations. There are currently, at the end of 2006, 32 “non-conformities” at Pristina International Airport. In order to address some of the more significant ones, the Airport needs to do the following:

Construct an airport drainage system

Resurface the runway

Increase the bearing capacity of taxiways

Construct an apron extension

Design and implement the airfield lighting, and

Develop a Safety Management System (SMS)

164.A number of these projects are already under way. The Airport itself cannot finance everything, and has sought funding from external sources. On 11 July 2005, it signed an agreement with the Ministry of Finance and Economy for a 12 million Euro loan.

165.On 14 June 2006, Pristina International Airport received the “Best Airport 2006 Award,” in the category of airports serving under one million passengers per year, at the 16th Airports Council International (ACI) Europe Annual Congress in Athens. The award recognised the Airport’s 300% increase in passenger traffic over the recent years, as well as its significant investment in facilities, its rapidly expanding network, and intensive capacity building efforts.

166.The Airport has designated a Kosovo Managing Director who is awaiting approval by the Airport’s and the KTA’s Boards of Directors.

7. Privatisation of Socially Owned Enterprises

167.Kosovo’s Socially Owned Enterprises (SOEs) operate in all sectors of the economy,and it is estimated that they represent 90% of Kosovo’s industrial assets. In the agricultural sector, 20% of prime agricultural land (including the only parcels suitable for large-scale commercial agricultural production) is SOE land. In addition, 60% of Kosovo’s forests (270,000 hectares) are SOE land. A significant lack of investment in plant and equipment, combined with a lack of modern corporate governance over the past fifteen years, has caused the SOEs to become ineffective business organizations. The loss of market share for SOE products has also made the majority of SOEs effectively bankrupt. Most are currently surviving by leasing out their assets to third parties.

168.The Kosovo Trust Agency (KTA) was established by UNMIK Regulation No. 2002/12 and mandated to administer Publicly Owned Enterprises (POEs), and to administer, as well as privatise and liquidate the SOEs. SOEs are sold off via regular or special spin-off procedure, whereby New Companies (NewCos) are created from the assets of existing SOEs and tendered for sale. After the sale of a NewCo, the parent SOE is liquidated through the sale of any remaining assets. All sale proceeds (from liquidation and privatisation) are held in trust by the KTA, except for 20%, which are paid to the eligible workers of the SOEs (as per UNMIK Regulation No. 2003/13 On the Transformation of the Right of Use to Socially-Owned Immovable Property). Proceeds held in trust are to be used for settling possible legitimate claims of creditors or owners (as per UNMIK Regulation No. 2005/48 On the Reorganization and Liquidation of Enterprises and their Assets under the Administrative Authority of the Kosovo Trust Agency). The proceeds are held at the Central Banking Authority of Kosovo (CBAK) for the KTA on behalf of the enterprises concerned.

169.When a company is offered for sale via special spin-off procedure, a number of conditions, such as future investment and employment guarantees, are taken into consideration in addition to the price in determining the winning bidder. Special spin-off conditions can also include parameters concerning the ethnic composition of the workforce, as in cases where a company already employs a large number of minority workers. Special spin-off procedures normally apply to SOEs that satisfy any of the following criteria: a) employment of, and regular tax payments for at least 300 persons over a three month period starting from 1 September 2002 and ending 30 November 2002, and b) total revenues of at least 10 million Euro in 2002. The Management of the KTA or a member of its Board of Directors may nonetheless propose to the Board that a particular SOE, which does not meet any of these criteria, should, all the same, be offered for sale via special spin-off procedure, if its privatisation is expected to have an extraordinary economic impact on Kosovo. After the sale, the implementation of the conditions included in special spin-off contracts is monitored by the KTA.

170.By the end of 2006, the KTA had launched 22 waves of privatisation. 393 NewCos had been tendered for sale and 216 sales contracts signed, (of these, 16 for special spin-offs), with total privatisation proceeds (received and banked) amounting to 267,784,767 Euro. Employees’ entitlement amounted to 53,556,953 Euro, of which 9,867,284 Euro had been paid out by the Independent Union of Trade Unions of Kosovo (BSPK). In addition, the KTA Board had approved a total of 76 liquidations, with proceeds amountingto 2,856,040 Euro.

Table 7

Total number of enterprises by sector of activities and capital origin

Total number of SOEs by sector

Enterprises

Total

%

SOE

Withoutdeterminedstatus

JSC

Cooperative

Agr. or food processing

35

3

4

2

44

7.26

Agriculture

96

16

1

30

143

23.60

Chem./Plast/Paper/Rubber/Glass

16

16

2.64

Construction materials

44

7

1

52

8.58

Forestry

19

2

21

3.47

Metal processing

39

2

3

44

7.26

Mining

5

3

1

9

1.49

Other a

45

11

3

1

60

9.90

Pharmacy

5

3

1

9

1.49

Services

30

18

5

1

54

8.91

Textiles

22

2

24

3.96

Tourism & Hospitality

21

3

24

3.96

Trade & Retail

54

7

2

1

64

10.56

Transport

25

2

1

28

4.62

Wood processing

11

2

1

14

2.31

Total

467

79

25

35

606

100.00

Source: KTA.

a Banks, veterinary stations, traffic schools, radio stations, city cinema, artisan’s associations.

Table 8

Total number of privatised SOEs by sector (as of 31 December 2006)

Number of SOEs tendered for Privatisation

Number of NewCos created

Withdrawn/No bid

NewCo sales contracts signed

NewCo contracts pending signature

Sales to be approved by KTA board

Agr. or FoodProcessing

28

41

4

32

3

2

Agriculture

38

76

9

25

31

11

Chem./Plast/Paper/Rubber/Glass

10

14

0

12

1

1

ConstructionMaterials

26

42

1

32

8

1

Forestry

0

0

0

0

0

0

Metal Processing

22

29

0

20

3

6

Mining

4

4

1

1

0

2

Other

9

12

0

10

1

1

Pharmacy

2

2

0

2

0

0

Services

16

25

0

11

8

6

Textiles

15

22

0

17

5

0

Tourism & Hospitality

9

33

2

23

6

2

Trade & Retail

31

82

3

37

28

14

Transport

8

8

1

4

2

1

Wood Processing

8

9

5

3

1

Total

226

399

21

231

99

48

Source: KTA.

Table 9

Revenue from privatised SOEs by sector

Sector

Total (in Euro)

Ag. and food processing

31 656 982

Agriculture

12 978 140

Chemical

9 907 714

Construction material

48 732 630

Hotel and tourism

26 030 106

Metal processing

50 586 885

Mining

109 136

Other

9 845 700

Pharmacy

1 325 479

Service

7 061 469

Textile

13 402 944

Trade and Retail

21 619 893

Transport

2 647 611

Wood processing

7 408 185

Grand t otal

243 312 874

Source: KTA.

C. Prohibition of forced labour

171.Inasmuch as the applicability of international conventions proscribing enslavement, forced or compulsory labour and child labour is concerned please refer to the discussion thereof in the UNMIK Report to the Human Rights Committee on the Human Rights Situation in Kosovo since June 1999 dated 13 March 2006 under Article 8. Furthermore, the Essential Labour Law explicitly prohibits forced or compulsory labour, which is defined as all work or services which is exacted from any person under the menace of a penalty and for which such person has not offered himself/herself voluntarily. Violations can be punished with fines up to 10,000 Euro.

172.Work in prisons is regulated by UNMIK Regulation No. 2004/46 On the Law on Execution of Penal Sanctions of 19 November 2004. Penal sanctions are carried out by the UNMIK Department of Justice Penal Management Division (PMD) which is gradually transferring its functions to the Kosovo Correctional Service. The Law grants the right to a rehabilitation programme to a convicted person which shall include the participation in vocational training activities or work. It also stipulates that a convicted person who is capable of working has the right and obligation to work. The work shall be useful and not degrading and may not be imposed as a form of disciplinary punishment. To the extent possible, a convicted person can choose the type of work he or she prefers to perform and may be employed inside or outside the correctional facility. There is a right to remuneration and annual leave in accordance with the general provisions on labour. Also, other benefits as well as safety and health precautions shall be done in accordance with the Essential Labour Law, which is generally applicable for these purposes.

173.During a natural or other disaster, all Kosovo residents are obliged to assist the protection, rescue and aid forces, or to do other work assigned to them by the authorities. The obligation to assistance starts from the age of 18 up to the age of 65 (men) or 55 (women) for all persons who are sufficiently healthy to fulfil the tasks. This is stipulated in Law No. 02/L-68 On Protection Against Natural and Other Disasters, promulgated by UNMIK Regulation No. 2007/4 of 15 January 2007 which defines a disaster as an event caused by uncontrolled natural and other forces that risk life and health of people, animals and property, causing damages to cultural and natural heritage and environment, where particular forces and tools are needed to manage them. The law contains also non-exhaustive lists of situations considered to be such natural or other disasters.

D. Prohibition of discrimination

174.The applicable laws in Kosovo foresee the realisation of the right for everyone to have the opportunity to earn money through work in a freely chosen or accepted job. All men and women shall have equal access to a work place at all levels and all professions.

1. Labour Law

175.The Essential Labour Law proscribes any discrimination in employment and occupation, also any distinction, exclusion or preference made on the basis of race, colour, sex, religion, age, family status, political opinion, national extraction or social origin, sexual orientation, language or union membership which has the effect of nullifying or impairing equality of opportunity or treatment in employment or occupation.

176.The Essential Labour Law stipulates likewise that any distinction, exclusion or preference in respect of a particular job based on the inherent requirements thereof shall not be deemed to be discrimination. Furthermore, discrimination against a disabled person, whose prospects of securing, retaining and advancing in suitable employment are substantially reduced as a result of a duly recognised physical or mental impairment, is prohibited. Also discrimination, direct or indirect, against a female employee arising from her pregnancy or childbirth is prohibited. Sexual harassment at the workplace is prohibited.

177.Furthermore, the law stipulates that employees shall enjoy adequate protection against acts of anti-union discrimination. Acts of anti-union discrimination are defined as making an offer of employment subject to the condition that the prospective employee shall not join a union or, where applicable, relinquish union membership; or discharging or otherwise prejudicing an employee because of his/her union membership, or participation in union activities. Article 13 stipulates equal pay for women and men for work of equal value. There are sanctions up to 10.000 Euros foreseen for the infringement of these rights.

2. Civil Service Law

178.The Civil Service Law stipulates that employment in the civil service is carried out by fair and open competition, based on merit and in accordance with the principles of the equal gender representation in all fields. Furthermore, there shall be no discrimination, direct or indirect, based on sex, race, colour, language, religion, political opinion, national, ethnic or social origin, association with a national community, property, birth, disability, family status, pregnancy, sexual orientation, or age; and recruitment at all levels in the civil service shall reflect the multi-ethnic character of Kosovo and the need for equitable representation of all the communities in Kosovo. The hiring of senior public appointees such as Permanent Secretaries in Ministries and Chief Executive Officers in Executive Agencies is within the competence of the Senior Public Appointments Committee (SPAC) established under Chapter IV of UNMIK Regulation No. 2001/36 on the Kosovo Civil Service.

179.Section 4 of the law grants the right to civil servants to belong to political parties and other political organizations but proscribes active involvement in political activity. Likewise, they have the right to belong to trade unions. Yet restrictions regarding the right to strike for certain categories of civil servants are in place.

3. Gender Equality Law

180.According to the Gender Equality Law, public and private sector undertakings and legislative and executive institutions shall provide equal rights and opportunities for females and males in labour and the employment sector. Vacancies shall be available equally for females and males and job vacancies shall not contain any discriminatory expressions. Employers shall take measures to ensure that positions are not categorised specifically for females or males. An exception from the requirement to have gender-neutrally formulated job vacancies is foreseen in cases where the announcement is published to achieve a gender balance in a certain professional sector, provided however that such intention is clearly stated in the announcement.

181.The Law reiterates the equal pay condition and stipulates further that women and men shall have equal employment and working conditions and rights. Also, employers shall ensure that both female and male employees have equal opportunity to attend education and professionaltraining that aim to improve professional skills or prepare them for other professions. Employers shall take all necessary measures to enable females and males to correspond to both their professional and family obligations. The Law requires from the employer that the time schedule, in accordance with the needs of the labour market and family-state of employees, be organised in such a way that female employers can return to their previous posts after maternity leave, parental leave, sick leave or after the time spent out of the place of work due to family emergencies or professional training.

182.The Law requires from employers to organise the work and time schedule so that female staff can return to their previous posts after maternity and parental leave. The same should be made possible for those staff who are on longer sick leave or absence from the work place due to family emergencies or professional training. The Law furthermore proscribes sexual or other harassment at the work place. Furthermore gender discrimination is proscribed in cases of job cuts.

E. Labour market situation

183.The economic situation of Kosovo started deteriorating in the early 1980s, when output fell to 1.8% compared to the average annual growth of 6% recorded in the 1970s. In 1988, Kosovo was by far the least developed province among the federal units of the SFRY, with only 27.8% (USD 700) of the average GDP per capita of Yugoslavia (USD 2,520) The contraction continued throughout the 1990s, with decreasing rates of output and income, widespread unemployment and increasing levels of poverty. Since the end of the 1999 conflict, per-capita income increased four times, driven by extensive donor reconstruction aid, income transfers from the large international presence - i.e. the UNMIK and the NATO-led military forces - and remittances from migrant workers.

184.However, the post-conflict recovery in industry, agriculture and mining was very slow. The structure of the economy has shifted towards the service sector, which now accounts for 60% of GDP while agriculture accounts for only 25% and the industrial sector for 15%. During the emergency phase from mid-1999 to 2002 there was substantial international support for reconstruction and revitalisation of the economy.

185.Estimates put foreign assistance in the period 2000-2003 at a total of 4.1 billion Euro, with private inflows adding another 2.4 billion Euro. Six years after the conflict Kosovo’s economy is still partly dependent on external assistance, with donor funding and remittances contributing 23% and 15% respectively to the GDP. These inflows had a negative impact on economic and employment growth. During the reconstruction period, factors of production shifted to those goods and services demanded by aid agencies, expatriates and remittances’ investment - mainly construction, housing, retail trade and other services - to the detriment of traditional sectors such as agriculture and manufacturing. Most importantly, the multiplier effect on the economy was quite limited due to the preference for imported goods. Hence, the employment impact of reconstruction was restricted to a number of occupations and dwindled down once these needs were over. Access to external financing and the adoption of the Euro in 2001 helped reduce inflation from 11.7% in 2001 to 1.2% in 2003.

Table 10

Kosovo selected economic indicators 2002-2006

2002e

2003e

2004e

2005e

2006p

National accounts

Real GDP growth

-0.1

-0.5

2.0

-1.5

2.0

Investment (% GDP)

23.7

22.9

26.3

28.2

28.9

Gross Domestic Savings (% GDP)

-7.1

-5.7

-4.2

-8.3

-5.3

Government budgeta

Overall balance (millions of Euros)

98

47

-138

-67

-77

Overall balance (% GDP)

4.0

1.9

-5.4

-2.9

-3.0

External accounts

Current account balance (% GDP) b

-32.8

-26.6

-26.3

-31.5

-29.2

Foreign assistance (millions Euro)

887

688

570

553

546

Workers’ remittances (millions Euro)

341

341

341

345

347

Consumer Price Index (CPI)

3.6

1.2

-1.5

-2.1

-1.8

Source: World Bank and IMF staff estimates; in World Bank, Interim Strategy for Kosovo for the Period 2006-2007, Washington D.C. 2006.

e=Estimate, p=Projections.

a Excludes donor designated grants and off -budget UNMIK and donor expenditures.

b Before donor grants.

Table 11

Number of registered taxpaying enterprises by ownership and size

Year-quarter

Total

Enterprises

Small

Medium

Large

2004 - 1st

29 129

27 458

1 456

215

2004 - 2nd

29 538

27 854

1 470

214

2004 - 3rd

29 436

27 781

1 446

209

2004 - 4th

29 524

27 907

1 417

200

2005 - 1st

29 863

28 247

1 419

197

2005 - 2nd

29 704

28 072

1 428

204

2005 - 3rd

29 294

27 654

1 432

208

2005 - 4th

27 311

25 755

1 356

200

Source: MFE, Tax Administration, published in SOK Monthly Bulletin 10/2006.

Table 12

Number of registered taxpaying enterprises by economic activity

Year - quarter

Total

Economic activity

Agriculture

Industry

Construction

Trade

Transport

Finance

Services

2004 - 1st

29129

262

3185

1400

16230

2583

42

5427

2004 - 2nd

29538

254

3161

1411

16448

2585

43

5636

2004 - 3rd

29436

258

3144

1402

16330

2575

47

5680

2004 - 4th

29524

258

3153

1366

16400

2591

50

5706

2005 - 1st

29863

254

3114

1448

16424

2741

49

5833

2005 - 2nd

29704

263

3135

1425

16380

2528

46

5927

2005 - 3rd

29294

254

3112

1349

16133

2464

47

5935

2005 - 4th

27311

236

2898

1251

16132

2209

45

5540

Source: MFE, Tax Administration, published in SOK Monthly Bulletin 10/2006.

186.The Kosovo population grows fast. Estimates suggest that in 2004 over 50% of the population was under the age of 25, with more than 21% of it falling under the UN statistical definition of youth. The population at working age, i.e. from the age of 15 to 64, is thus comparably low. Further, the overall labour force participation rate in Kosovo is one of the lowest in the region. Main reasons for this are that increasing numbers of young people continue to study after having completed compulsory education. At the same time many older workers (above 55) leave the labour force well before retirement age.

187.The largest impact, however, must be the extremely low participation rate of women, especially those aged between 25 and 39, who usually take on child care and household responsibilities instead of engaging in the labour market. Women participation rate is at 30% which is less than half of that of men (68%). The extremely low figures suggest that, besides other problems, also discrimination in employment and occupation resulting from stereotyped gender roles and societal rules as well as institutional and other barriers that limit women’s access to the labour market could play a role. However, it is noteworthy that the employment situation in Kosovo even before 1999 was the lowest compared to other areas of the FRY for manifold reasons.

188.There is a positive correlation between employment and educational attainment - over 57% of young people with tertiary education was employed in 2004, against only 14% of youth with less than primary education. The structure of employment by sector and branch indicates that the service sector is the first provider of employment in Kosovo accounting for more than 65% of total employment. There is also a high percentage of self-employment in Kosovo, about one quarter of the total employed in 2004.

189.There exists no reliable data on informal employment. According to a survey conducted in 2003, about half of the employment in Kosovo was in the informal economy, according to the ILO criteria of whether employees had a signed contract and the enterprises were registered. The degree of informality was higher if measured according to whether payroll taxes were paid or withheld (two-thirds were informally employed based on this criterion). Also among the young self-employed informality is widespread. More than 23% of young self-employed were not registered with the competent authorities in 2004, among established enterprises the percentage was 5.2%.

Table 13

Labour force participation and employment (%)

2002

2003

2004

2005

Population at working age (age 15-64)

Women

64

63

63

64

Men

62

60

61

61

Participation rate

Women

35

30

25

30

Men

72

72

68

68

Employment rate

Women

9

8

10

12

Men

39

43

46

46

Unemployment rate

Women

74

72

61

60

Men

45

40

31

33

Source: SOK Labour Force Survey (LFS), 2002, 2003, 2004, 2005.

Table 14

Employment by sex and age-groups (%)

Age groups

2002

2003

2004

2005

Women

Men

Women

Men

Women

Men

Women

Men

15-24

4

16

3

18

4

19

4

19

25-54

13

55

12

60

14

63

14

63

55-64

3

33

2

38

7

42

7

42

65+

-

-

-

-

0

4

0

4

Total: 15-64

9

39

8

43

9

43

9

43

Source: SOK, LFS 2002, 2003, 2004, 2005.

190.There is a close link between the level of education and the employment rate. The higher the education the easier it seems it is to find a job and keep it. Unemployment is comparably low especially for those with higher education.

Table 15

Employment by sex and education (%)

Education

2002

2003

2004

2005

Women

Men

Women

Men

Women

Men

Women

Men

Primary

2

25

2

31

4

34

5

31

Secondary

20

43

18

47

18

50

19

49

Higher education

63

80

67

78

75

83

64

82

Source: SOK, LFS 2002, 2003, 2004, 2005.

191.Women are to a large extent employed in sectors labeled as light activities, i.e. trade, education and health. However, the share of women working in agriculture increased over the last years. One explanation suggests that migration into cities seems not to have brought jobs to the women, forcing them to return to agricultural jobs.

Table 16

Employment by sex and by economic activities (%)

Economic a ctivity

2002

2003

2004

2005

Women

Men

Women

Men

Women

Men

Women

Men

Agriculture

7

11

9

19

22

25

21

18

Mining

0

2

1

1

0

1

0

2

Industrial p roduction

8

11

8

11

7

9

6

11

Energy sector

3

5

1

4

2

5

1

4

Construction

1

14

1

13

2

9

1

10

Trade

13

18

13

14

13

14

13

14

Hotels and restaurants

3

4

1

3

1

4

2

4

Transport

2

5

2

5

2

5

2

5

Finance

1

1

2

1

1

1

2

1

Business services

1

1

1

1

2

2

1

3

Public a dministration

7

9

11

9

8

6

7

8

Education

18

10

23

10

18

9

19

9

Health

21

2

19

2

14

3

15

3

Other

15

8

9

6

9

6

9

10

Source: SOK, LFS 2002, 2003, 2004, 2005.

Table 17

Employment by main groups of occupation and sex (%)

Occupation

Women

Men

Professional worker

28

12

Servants and sellers

16

17

Technicians

17

7

Agricultural workers

13

11

Elementary professions

13

17

Clerks/civil servants

9

4

Craftsmen

3

17

Managers

2

7

Machine operators

1

7

Source: SOK, LFS 2005.

Table 18

Employment by sex and professional status (%)

Employment status

Women

Men

Employed

69

59

Self-employed 1 or more paid employees

2

9

Self-employed 0 employees

8

18

Work in the family

21

16

Source: SOK, LFS 2002, 2003, 2004, 2005.

Table 19

Employed by sex and contract assignment (%)

Type of contract

2002

2003

2004

2005

Women

Men

Women

Men

Women

Men

Women

Men

Part-time

31

23

31

30

31

30

26

21

Full-time

69

77

69

70

69

70

74

79

Temporary

12

13

15

14

67

64

53

45

Permanent

88

87

85

86

33

36

47

55

Source: SOK, LFS 2002, 2003, 2004, 2005.

Table 20

Average working hours per week by assignment and sex (in hours)

Type of contract

2002

2003

2004

2005

Women

Men

Women

Men

Women

Men

Women

Men

Part-time

22

24

23

25

23

23

24

22

Full-time

43

46

42

45

42

43

42

44

Source: SOK, LFS 2002, 2003, 2004, 2005.

Table 21

Unemployment by sex and by age groups (%)

Age group

2002

2003

2004

2005

Women

Men

Women

Men

Women

Men

Women

Men

15-24

90

68

90

66

82

58

81

64

25-54

66

39

63

33

53

25

54

26

55-64

35

34

29

22

26

17

17

19

Total 15-64

74

45

72

40

61

31

60

33

Source: SOK, LFS 2002, 2003, 2004, 2005.

Table 22

Unemployment by sex and education (%), age 15-64

Education

2002

2003

2004

2005

Women

Men

Women

Men

Women

Men

Women

Men

Primary

90

53

88

45

73

35

72

38

Secondary

67

48

68

43

62

34

63

36

Higher

22

14

20

14

16

9

22

9

Source: SOK, LFS 2002, 2003, 2004, 2005.

Table 23

Inactive by sex and age groups (%)

Age group

2003

2004

2005

Women

Men

Women

Men

Women

Men

under 15

37

59

36

57

36

56

15-24

16

18

18

19

17

19

25-54

31

6

31

9

31

9

55-64

8

6

7

5

8

6

65+

8

11

8

9

9

11

15-64

55

30

56

34

55

34

Source: SOK, LFS 2002, 2003, 2004, 2005.

Table 24

Women employed in leadership positions, public sector, 2005

Position

Number

%

Women

Men

Women

Men

Head of Division

44

131

25

75

Coordinator/Head of Unit

76

233

25

75

Department Director

11

83

12

88

Executive Director

1

8

11

89

Parliamentary Secretary

0

12

0

100

Total

132

467

22

78

Source: Ministry of Public Service (MPS), Department of Civil Service Administration (DCSA).

192.Women occupying positions at the central government level are 38%. The highest percentage of women work at the Ministry of Culture, Youth and Sports and the Ministry of Local Government (43%). Women have limited representation at the Ministry of Agriculture, Forestry and Rural Development (12%).

Table 25

Participation of women in institutions, 2006

Ministry

Number

%

Women

Men

Women

Men

Ministry of Local Government

23

30

43

57

Ministry of Culture, Youth and Sports

207

275

43

57

Ministry of Public Service

1 074

1 541

41

59

Ministry of Labor and Social Security

616

901

41

59

Ministry of Education, Science and Technology

87

137

39

61

Ministry of Environment

104

164

39

61

Ministry of Health

2 894

4 620

39

61

Ministry of Economy and Finance

320

556

37

63

Ministry of Communities and Returns

47

91

34

66

Ministry of Trade and Industry

52

109

32

68

Office of the Prime Minister

46

102

31

69

Ministry of Energy and Mines

29

65

31

69

Ministry of Transport and Post-Telecommunications

69

223

24

76

Ministry of agriculture, Forestry and Rural Development

58

439

12

88

Total

5 626

9 253

38

62

Source: Ministry of Public Service (MPS), Department of Civil Service Administration (DCSA).

193.Out of 120 members of the Kosovo Assembly 35 are women (29%). Only two out of ten Assembly Commissions are chaired by women.

1. Minorities

194.The Kosovo education system, despite progresses, is still unable to overcomethe exclusion of some minority groups, with nearly 36% of youth belonging to the RAE community having less than primary education attainment in 2004.

Table 26

Youth educational attainment, 2004 (%)

Highest educational attainment

Total

Albanian

Serbian

RAE

Less than primary

2.7

1.6

2.4

35.7

Primary

9.7

9.1

8.4

30.9

Vocational

16.5

17.9

4.8

4.8

High School

54.2

53.4

77.1

21.5

University and higher

16.9

18.0

7.2

7.1

Source: ILO, STWS (2005).

Table 27

Key youth labour market indicators, 15‑24 years old, by ethnicity (%)

Total

Albanian

Serbs

RAE

Participation rate

56.9

56.5

63.4

41.2

Inactivity rates

43.1

43.5

36.6

48.8

Employed persons

28.7

29.2

23.4

17.4

Unemployed persons

28.2

27.3

40.0

33.8

Unemployment rate

49.5

48.4

63.0

66.1

Source: ILO, STWS (2005).

Table 28

Young workers with and without employment contact (by ethnicity, in %)

With employment contract

Without employment contract

Total

79.6

20.4

Albanians

81.1

18.9

Serbs

38.5

61.5

RAE

57.1

42.9

Source: ILO, STWS (2005).

Table 29

Youth long‑term unemployment by ethnicity (%)

Long-term unemployment

Total

42.6

Albanians

36.2

Serbs

88.6

RAE

72.2

Source: ILO, STWS (2005).

Table 30

Minorities employed in Publicly Owned Enterprises as of 31 December 2006

POE

Total Employees

Number of Minority Employees

Breakdown by Ethnicity

% of Minority Employees

KEK

8 100

106

AlbaniansSerbsMontenegrinBosniaksTurksRomaOther

7 9942412927322

AlbaniansSerbsMontenegrinBosniaksTurksRomaOther

98.690.300.010.360.330.040.27

PTK

2 198

87

AlbaniansSerbsBosniaksTurksMuslimRomaOther

2 11111132822103

AlbaniansSerbsBosniaksTurksMuslimRomaOther

96.040.500.601.271.000.450.14

Railways

390

60

AlbaniansSerbs

330

60

AlbaniansSerbs

84.6115.38

Airport

632

12

AlbaniansSerbsTurksEgyptiansMuslim

6205322

AlbaniansSerbsTurksEgyptiansMuslim

98.310.840.670.170.17

Waste Companies

1 587

374

AlbaniansSerbsRomaBosniaksTurks

1 213108218453

AlbaniansSerbsRomaBosniaksTurks

76.436.8013.732.840.20

Water and Irrigation Companies

2 114

371

AlbaniansSerbsBosniaksTurksRomaAshkaliOther

1 74326372171063

AlbaniansSerbsBosniaksTurksRomaAshkaliOther

82.4012.423.400.800.470.280.23

District Heating

196

25

AlbaniansSerbsOther

171196

AlbaniansSerbsOther

87.249.693.06

Grand total:

15 221

1 035

n/a

6.79

Source: UNMIK (EU Pillar).

2. Employment in the mining sector

195.The Ministry on Energy and Mines (MEM) reports that the Trade Union of Trepça organised protests in the year 2006 in order to address their concern over the direction the mine was going and to protest against more workers being made redundant. MEM further reports that, according to information provided by the General Director of Trepça Mining, there was an increase of salaries from 166 Euro to 236 Euro for the workers that work inside the mines, due to the hazardous work. In addition, according to information provided by the Technical Director of Trepça Mining, the workers working outside of the mine receive now 206 Euro, while the workers that work inside the mines receive 265 Euro. It is worth to mention that transportation and a daily meal are provided free of charge for all workers of Trepça Mining. Following the temporary closure by UNMIK of lead smelting activities in 2000, due to extreme levels of environmental pollution, over 930 former workers are out of the production process in Trepça and are not able to return to work either due to reduction of production capacities or due to their state of health. These workers receive pensions which vary between 30 Euro, 50 Euro and up to 80 Euro.

196.The Kosovo Energy Corporation (KEK) also conducts mining activities for coal, predominantly for use in the generation of electricity. Furthermore, a private company has also recently purchased a privatised former socially owned mining enterprise.

3. Employment within UNMIK Pillars

197.A review of employment levels for local staff of all UNMIK components - the UN Pillars and Offices (financed and managed by the UN), the OSCE Pillar (funded and administered by the OSCE) and the EU Pillar (funded and administered by the European Union) - reveals that UNMIK accounts for less than 1% of official employment in Kosovo. As of 2006, UNMIK employs about 3,250 local staff, of which the majority have high school degrees and higher education, accounting for 4% of official employment of persons with higher levels of education in Kosovo. The review suggests that “while this has caused a temporary talent drain from the rest of the economy, in the long run this may be advantageous as UNMIK has provided skills (on the job and through additional training) that can help meet the demand for higher skills in the future.”

198.UNMIK employs a high proportion of minorities - 18% is double their representation in Kosovo. The review speculates that “there could be several reasons that have played a role in a relatively high employment of minorities. First, UNMIK has actively attempted to provide employment opportunities to minorities. Moreover, a large proportion of minorities do not speak Albanian, which restricts their mobility in the labour market. On the other hand, members of the Serbian community appreciate not only the higher salaries, but also the high degree of personal security in UNMIK employment.”

199.The review identifies that “of the current local UNMIK staff, 70% are male and 30% are female, compared to a ratio of 80% to 20% in the rest of the Kosovo economy.

200.Furthermore, the review notes that “resembling the average labour force age structure, 74% of local UNMIK employees are under the age of 40. However, local staff in UNMIK are younger in comparison to the rest of the economy, where 65.8% of employees are under 40. This is not too surprising because one of the main employment criteria in UNMIK is knowledge of English, which is more prevalent among younger generations.”

Table 31

Employment of Local Staff in UNMIKa, b

2000

2001

2002

2003

2004

2005

2006c

UN

2 177

3 626

3 533

3 273

2 916

2 692

2 246

OSCE

1 852

1 487

1 108

962

897

833

697

EU Pillar d

82

129

136

201

243

313

320

UNMIK Total

4 111

5 242

4 777

4 436

4 056

3 838

3 263

Source: Performance reports on the budget of UNMIK, OSCE and EU PillarPersonnel Departments.

a EPO Review, page 13.

b All figures, except for the EU Pillar, are annual averages and are calculated by adding up the number of staff at each year and dividing the sum by 12.

c 2006 figures are all actuals in February 2006.

d For the EU Pillar actuals for December of each year were received. The difference between two adjacent years was divided by two and added to the first of the two.

201.Around 64% of the jobs created by UNMIK are concentrated in the Prishtinë/Priština region. In 2006, the percentages for other regions are 9% for Prizren, 7% for Gjilan/Gnjilane, 7% for Pejë/Peć and 13% for Mitrovicë/Mitrovica region.

202.The review notes that “average gross salaries paid to UNMIK local staff are 5.7 times higher than the Kosovo average and account for 4.6% of Kosovo’s total gross wage bill. Although there is no conclusive evidence, UNMIK spending appears to have put a slight upward pressure on the overall wage level, which is estimated at some 2.5%. However, UNMIK might also have contributed to keeping in Kosovo those who otherwise would have migrated abroad.”

203.Contracts for local employment in the three organizations of UNMIK (UN, EU and OSCE) are fixed-term appointments with no expectation of extension. Conditions of service are determined by the respective staff rules and regulations that each of the three organizations has established governing their operations world‑wide. As such, conditions of service of local staff contracts are not governed by locally applicable legislation in Kosovo.

F. Active employment policy

1. Kosovo Economic Policy Strategy

204.In November 2005, the then Prime Minister together with the SRSG published a Memorandum of Economic and Financial Policies of Kosovo outlining the policies and development objectives for the next three years. It declares reduction of the unacceptably high level of unemployment and especially trying to provide jobs for the young and rapidly expanding labour force to be the most important economic policy objective.

205.The use of the Euro has created confidence and fostered the development of a fast growing financial sector. In addition, the modern and efficient tax system, with low uniform rates and few exemptions, in combination with the liberal trade and tariff regime has allowed Kosovo to raise the revenues required to operate government with a minimum of distortions. Moreover, the generally light regulation has helped private entrepreneurs to use Kosovo’s resources where they can be productively employed.

206.This principled approach to economic policy has already delivered results, even in Kosovo’s difficult conditions, where resolving the status is a key requirement for progress. Still more needs to be done. Importantly, Kosovo’s competitiveness must be improved further and investments in the private sector are vital. In addition priority needs to be set on improving the physical infrastructure as well as raising human capital through better health services and education.

2. Kosovo Development Strategy Plan 2007-1213

207.In 2005, the PISG acknowledged the necessity to formulate a development paradigm for Kosovo. As a result, the Kosovo Development Strategy Plan (KDSP) process had been initiated, led by the Office of the Prime Minister. This inclusive process took place with the participation of (a) civil society, who, following seven regional comprehensive workshops, developed a platform for civil society consensus over the course of six months; (b) a macro-economic and fiscal team which worked closely with the Ministry of Finance and Economy to identify a macro‑economic reform‑driven scenario; and (c) a network of technical and policy groups in the line ministries which produced policy papers and public expenditures estimates. Following the status settlement, a revision of the KDSP will take place to incorporate status related decisions.

208.The KDSP recognises the need to reduce the unacceptably high level of unemployment and foresees the creation of sustainable employment generating growth based on three building blocks: (a) a stable governance framework, (b) economic growth driven by Small and Medium Enterprises (SMEs), and (c) promotion and mobilisation of human resources. In light of the very young population and the high birth‑rate, the main challenge for the labour market will be the difficulties to absorb those entering the labour market for the first time.

209.The KDSP describes two scenarios, a baseline and a reform-driven scenario. However, even under the assumption of a high growth rate of around 4.5% per annum, given the present levels of unemployment and the labour force trends, it seems likely that employment growth will not be sufficient to bring unemployment down to acceptable levels. The KDSP projections suggest that ‘only’ some 15,000 jobs could be generated per annum. With such a growth rate, unemployment would be around 25% in 2013, whereas 25,000 jobs per annum would be required to reduce unemployment to 15%. This demonstrates the importance of promoting private sector development, particularly of SMEs, which will be the engine for employment generation.

210.The three building blocks necessary to achieve this aim, a stable governance framework, economic growth driven by SMEs, and promotion and mobilisation of human resources, are closely intertwined. Building of stable governance is the strategic path to ensure internal security and rule of law as a precondition to inter alia business development and the attraction of foreign capital and investors. Ensuring effective protection of minority rights is another priority since it will guarantee stability and peace.

211.Economic growth will be driven by SMEs, since according to the macro‑economic analysis and possible scenarios developed so far, Kosovo will become more and more an import/export society based on SMEs rather then based on large enterprises. Primary exports that were dominant in the past would not alone ensure stable and sufficient incomes, while they would also be unable to generate the needed employment and in addition they produce negative externalities on the environment. In the short term it is also paramount to quickly complete the privatisation process and recover the existing capacities as well as to develop the infrastructure.

212.Human resource development will provide the basic resource to support the overall strategy - a qualified human factor. The available workforce needs to increase its skills and capacities. One key objective is to improve employability and manage migration since for the medium‑term the labour market will be able to absorb only in part the large existing unemployment. Another key objective is the upgrading of the education system and facilitating the access to technology and innovation. The third key objective is a sustainable health system and safety nets for social cohesion.

213.The KDSP foresees two phases of implementation to take place: in 2007-2009 the Government, with the support of international partners, will create a business environment attractive to SMEs, and will attract some foreign investment in Telecommunications and the mining sector, as well as completing privatisation. Reforms in the education and health sectors, with particular attention in these and other policy areas to the most vulnerable groups of Kosovo’s society, will complement this effort. From 2010 to 2013 the reforms will have created a favourable context for significant foreign investment in energy production and possibly the SME sector, at which time the main focus will be to improve the infrastructure and access to technology further while maintaining the high standards in governance.

3. Private sector development

214.Due to the necessity to provide institutional support to the Kosovo private sector, the Ministry of Trade and Industry (MTI) established the Department of Private Sector Policy Development (DPSPD). It is aiming at facilitating a free and unimpeded development, without physical, procedural and bureaucratic barriers, while at the same time creating an environment for the development of sustainable businesses, with strong competing abilities in the internal, the regional and the international market.

215.The DPSPD is comprised of two divisions. First, the division of analysis, strategies and enterprise policies staffed with four employees. It covers mainly the areas of development policy making, issuing recommendations on privatization, and economic policy analysis. Second, the division of enterprise support and regional development staffed with twelve employees (four of which belong to minorities). It covers mainly the areas of database creation, enterprise stimulation and promotion, and regional co‑ordination. The division is represented in the regions with offices in Prishtinë/Priština, Pejë/Peć, Prizren, Mitrovicë/Mitrovica, and Gjilan/Gnjilane.

216.The DPSPD has drafted a Law on Loan Guarantee Schemes, however, it is stuck in the legislative process due to budgetary limitations. The draft Law on Trade Companies is envisaged to be finalised within the current year.

217.The DPSPD, through various activities and projects, provides extensive support to the economic development of the private sector including Small and Medium Enterprises (SMEs). Among activities of DPSPD involvements are:

European Charter on Small Enterprises (the project has been implemented)

Work premises (space) (three incubators are about to be completed in Shtimje/Štimlje, Deçan/Dečane and Gjilan/Gnjilane, while in Gllogovc/Glogovac the implementation of the project Industrial Park is ongoing)

Strategy on Private Sector Development (first draft of the strategy has been compiled)

Advisory and Training Scheme Voucher (implementation of first phase has been successfully completed and implementation of second phase is ongoing)

Research on SMEs and structured interviews (on going projects for 2006)

Consultative Board of SMEs (the project has been implemented)

Kosovo SMEs Observer (the first draft of analysis has been compiled)

The 2005 most successful enterprise (ongoing), and

Women in Business Fair (ongoing)

4. Support to small and medium enterprises

218.A law to support SMEs has been promulgated in 2005, and it is expected to be operationalized in the beginning of 2007. It regulates governmental policies and measuresto classify small (<9 employees; <500,000 Euros turnover the previous year) and medium (10‑49 employees; <2,400,000 Euros turnover the previous year) enterprises and aims at inciting their establishment and supporting their development.

219.The objectives of the SME support programmes are:

To create a favourable private entrepreneurial environment

To increase employment

To increase exports and adjustment to the global market

To increase SME efficiency, quality and competition

The application of contemporary technologies and innovations

To increase the number of SME entities and

To stimulate activities that do not pollute the environment

220.The concept of the law is that enterprises meeting the criteria need to submit an application for participation in one or more of the programmes offered. In view of that the law provides the basis to establish an SMEs Support Agency within the MTI. The Government of Kosovo may authorise the Support Agency to support the establishment of a sound SME environment by for example: ensuring and simplifying access to private loans and other credit facilities; disseminate relevant statistics from the Statistical Office of Kosovo; close cooperation with SMEs; promoting supportive infrastructure; etc.

5. Investment in the electricity sector

221.The Ministry for Energy and Mines (MEM) has drafted a Strategy for Electricity in Kosovo which has been approved by the Assembly of Kosovo in August 2006. For the implementation of that strategy, MEM co‑operates with the relevant policy making bodies in Kosovo as well as internationally. One major topic is to encourage private investment in the electricity sector. Some offers have already been received regarding the construction of a steam power-plant “Kosova C” on the basis of modern technology with minimal pollution. Such a big project would also have a significant impact on the number of unemployed people besides creating stability in view of providing electricity for private as well as commercial customers. This will in the end also make Kosovo more interesting for investments.

222.Although still dependent on reserved powers regarding the privatisation process of the Kosovo Trust Agency, MEM has drafted a number of laws in this field which are in the process of being promulgated by the SRSG. Moreover, MEM is in the process of finalising a strategy on minerals, which is very important for the development of this sector that has great potential for a number of new jobs.

223.The Department of Industry in MTI, within its projects on industry development, assisted various enterprises in presenting their products in fairs held in Kosovo. Moreover, this year a feasibility study for the construction of a new industrial zone has been completed. Such a zone would be of a great support to develop industry and thus for the creation of new work places.

6. Insurance for credits

224.The Ministry of Trade and Industry (MTI) has developed a Scheme of Insurance for Credits (SIC). It is a financial mechanism to cover the debtor in case of inability to pay the credit back. The mechanism diminishes the risk for the creditor and could be implemented through a special fund established by the Government comprised of some money from the KCB as well as donations or credits from international financial institutions. The aim of the scheme is to support access to bank credits for Small and Big Enterprises (SBE). Further, SIC aims at mediating between SBEs and financial institutions as well as promoting credits for enterprises in the start‑up phase, also in order to enhance competition within trade.

225.A draft law by MTI on the scheme has been discussed in a governmental working group (bank association, commercial banks, legal office of Prime Minister, MTI, MFE, EAR). However, the Government has stopped the process and sent it back for review. The difficulties in regards to the scheme mainly result from limited resources in the KCB.

7. Employment of young people

226.From a demographic perspective, youth in Kosovo presents the far biggest part of the population and thus also the largest number of people requesting work in employment offices. Too many young people are not prepared or qualified to participate in the labour market. Therefore, emphasis should be given to education, since young people are the biggest resource to support economic development in the future.

227.The Youth Department of the Ministry of Culture, Youth and Sports (MYCS) has compiled a programme on orientation and support of employment of young people in co‑operation with the Ministry of Labour and Social Welfare; the Ministry of Education, Science and Technology; the Ministry of Trade and Industry, the Ministry for Economy and Finance; NGOs and youth centres. The programme has the following objectives:

Advancement of capacities of young people through programmes of informal education

Preparation in conformity with the needs of the market

Facilitating start-ups, chances for self-employment and economic growth through creation of new work places

Support of youth initiatives with activities and projects of fund raising, and

Support non-discrimination at the work place

228.The programme organises training courses, seminars, appointments, debates for young people who need additional qualification also in view of receiving additional information on micro/small enterprises as a means of self-employment. This is supported by publications and dissemination of leaflets with information for the various economic interests of young people. The programme supports the establishment and co‑operation with training centres/-schools and takes also into account the special needs of young people with disabilities and young females. The co-operation with donors for the support of projects is ensured.

229.In addition, the MYCS is planning to provide training in view of supporting business development for young entrepreneurs. At the beginning a market analysis will explore possibilities and conditions for micro- and small enterprises in Kosovo and identify sectors for successful business activities. The training courses will be conducted in the youth centres or schools (or other appropriate facilities) to guarantee easy access also for young people from rural areas. They will address the needs of a broad variety of potential young entrepreneurs, interested in developing business ideas in crafts, services, agricultural production and food processing. Training will be provided by internationally trained local NGOs and supervised by international experts. Moreover specific support (training and coaching) will be offered to already existing young micro-entrepreneurs to support their efforts in sustaining and extending their business activities.

230.To cover all municipalities and ensure sufficient rural participation, 10 training sessions per year with 30 participants each will be conducted. The project will therefore in three years train approximately 900 potential young entrepreneurs. In the case that demand exceeds the training capacities, an appropriate pre‑selection instrument will be developed in close cooperation with the trainers and experts. In addition to the training classes, the project will provide coaching and advice to 30 already operating young entrepreneurs.

(a)The Kosovo Youth Employment Action Plan

231.Since September 2005 the Kosovo Government, under the aegis of the ILO, has gathered the knowledge and experience of policy‑makers, representatives of employer and worker organizations and other stakeholders to address the youth employment challenge through the development of a number of policy options affecting both demand and supply of labour. The results of this year long work were consolidated in the Kosovo Youth Employment Action Plan (the Action Plan).

232.The Action Plan is divided into three distinct parts. Part I presents a thorough analysis of the youth employment situation in Kosovo. Part II elaborates on a set of priority policies to tackle youth employment. Part III sets the operational aspects relating to the implementation of the Action Plan. The annexes provide the Action Plan Matrix, Work-plan and brief description of technical co-operation projects related to the Action Plan to be proposed for donor-funding.

233.The complexity and magnitude of the youth employment challenge in Kosovo call for preventive and curative approaches that address at the same time labour supply and labour demand and requires the sustained involvement of governmental agencies, labour market institutions including employers’ and workers’ organizations, as well as civil society. To this end, the Action Plan identifies three strategic objectives ‑ touching upon the education, enterprise development and labour market policy areas ‑ and a number of key outcomes to be pursued in the short to medium term for the promotion of full, productive and freely chosen employment for young people.

(b)Kosovo Youth Policy and Action Plan

234.The Kosovo Youth Policy and Action Plan for the years 2007‑2010 (KYAP) is the comprehensive strategy of the Kosovo Government on- and for youth. It aims at improving the situation of young people from 15-24 years of age by involving governmental and non‑governmental institutions in exploring and meeting the needs of youth and by finding ways and mechanisms for youth participation in the decision making process in Kosovo. The KYAP promotes co-operation between youth organizations and the Government, between all youth‑related Ministries and between central and municipal bodies in the area of youth policies and programmes.

235.The KYAP contains of two parts: the actual Policy document and the Action Plan. It starts with a diagnosis of the current situation and frames the policy objectives into six thematic areas that affect young peoples’ life: youth participation, education, employment, health, social/human security, culture, sports and leisure time activities. These are further developed in the KYAP matrixes, which link concrete activities, with measurable outcomes, responsible institutions and necessary funds.

236.The KYAP is mainstreamed into the “Kosovo Youth Employment Action Plan: A mid‑term policy framework 2006‑2009”. Regarding employment the KYAP focuses on the following objectives:

To support youth employment through a favourable tax relief system and allocation of funds for employability training

To increase capacities of the public employment services

To increase awareness and prevent exploitation of youth workers

To establish an information system on labour market and job opportunities

To facilitate youth transition from school to work, and

To promote youth entrepreneurship and self-employment

237.The overall KYAP budget amounts 7,140,400 Euro. 5,141,088 Euro will be covered by the KCB, and 1,999,312 Euro from the donor community. The budgetary amounts for each objective (thematic area) and the funding sources are as follows:

Table 32

Kosovo Youth Policy and Action Plan budget and funding sources

Objective (thematic area)

Total budgetin Euro

KCB (72%)in Euro

Donors (28%)in Euro

Participation

1 817 000

1 308 240

508 760

Education

1 472 000

1 059 840

412 160

Employment

1 054 400

759 168

295 232

Health

510 000

367 200

142 800

Human Security

550 000

396 000

154 000

Culture, Sports and Recreation

1 737 000

1 250 640

486 360

Total

7 140 400

5 141 088

1 999 312

Source: Ministry of Culture, Youth, Sports and Non-Resident Affairs.

Article 7

238.UNMIK Regulation No. 2001/27 On Essential Labour Law in Kosovo (the Essential Labour Law) entered into force 8 October 2001. Employment within the civil service, UNMIK, KFOR and the offices or missions of foreign governments and international organizations is not governed by this regulation. The Essential Labour Law establishes that a collective agreement may be concluded for a fixed period of no more than three years and that it should apply to employers and its employees who agree to be bound by such collective agreement. A collective agreement should furthermore not include provisions that limit employees’ rights or that result in less favourable conditions than those set out in this regulation. Disputes between the parties of the established General Collective Agreement which were not solved through social dialogue, should be solved by the Commission for reconciliation and arbitrage.

239.The Law On the Labour Inspectorate of Kosovo (Labour Inspectorate Law) was promulgated 21 February 2003. It recognises the need for the establishment of the Labour Inspection Authority as an important mechanism to control implementation of the Essential Labour Law and other protection labour rules. The Authority of Labour Inspection should apply to all workplaces except for within UNMIK, and other offices or missions of foreign governments and international governmental or non‑governmental organisations operating in Kosovo. The Labour Inspection Authority shall consist of the Chief Labour Inspector and labour inspectors who exercise their functions throughout Kosovo. Responsibilities of labour inspection are to: (a) Ensure implementation of the labour law, conditions of work and protection at work; (b) Provide technical information and advice to employers and employees on the most effective means of observing the legal provisions; (c) Notify the Minister of Labour and Social Welfare or other competent authorities on any deficiencies in the applicable law; (d) Supply information and advice to employers and employees and which would comply with the law and forewarn the competent authorities on any defects or abuses not covered by existing legal provisions; and (e) Give advice on issues relating to labour law and protection of employees in a case or reorganization or restructuring of an enterprise.

240.If a labour inspector determines that an employer is in violation of a provision of the Essential Labour Law, the labour inspector may issue a written warning to the employer or impose a fine. Furthermore, an employer may request that the Administrative Department of Labour and Employment, or the authority that will succeed it, review the labour inspector’s decision to fine the employer. An employer may also appeal to a competent court in Kosovo for a review of such decision. An appeal to the Law Inspection Authority may be filed within eight days, an administrative challenge to the court within 30 days time limit.

241.According to the Labour Inspectorate Law, the labour inspector must inform the employer of his/her presence, unless the labour inspector considers that doing so will influence the results of the inspection. The Ministry of Labour and Social Welfare confirms that in some cases there is a need to visit the workplace without prior notification. In general however, the labourinspectors conduct their inspection in the presence of the employer or his representative, whereas interviews with employees are done with or without the presence of the employer. Moreover, the labour inspectors evaluate the real situation through the recorded minutes where they include information on the name of the inspected subject, time, participants, date and address. In these recorded minutes the labour inspectors also put the violations of the subject. The employer is informed about the violation and is also given a deadline for the elimination of the violation. If the employer does not respect the deadline that was set up, the Labour Inspectorate proceeds with other measures, such as issuing a fine and preparing a report for the competent municipal court. In cases of direct hazard for the life of employees, the Labour Inspectorate will use the measure of work prohibition until the employer clears out the causes and the faults which represent the hazard.

242.The purpose of UNMIK Regulation No. 2001/36 On the Kosovo Civil Service (Civil Service Regulation) is to establish a legal and administrative framework to facilitate the functioning of an effective and impartial civil service in Kosovo, based on merit, and reflecting the multi-ethnic character of Kosovo.

243.In accordance with the Civil Service Regulation, an Independent Oversight Board (Board) is established. The Board shall be an autonomous unit located within the Ministry of Public Services. The Board shall be composed of seven members, appointed by the SRSG in consultation with the Prime Minister. A civil servant who is aggrieved by a decision of an employing authority in breach of the governing principles of the regulation may appeal such decision to the Board. However, before appealing to the Board, the civil servant must exhaust internal appeals procedures of the employing authority, unless certain exceptions are made. In addition, the Board shall determine whether the appointments of civil servants at the level of heads of department are made in accordance with the Civil Service Regulation; provide an annual assessment of employing authorities’ compliance with the Civil Service Regulation; and provide an annual report to the Prime Minister and the SRSG.

A. Fair wages

244.The Essential Labour Law, establishes that “[a]n employer shall pay equal remuneration, which includes the basic salary/wage and any additional entitlements and emoluments […] to women and men for work of equal value”.

245.According to the General Collective Agreement in cases where employees are exposed to high risk level, the value of special supplements to be paid, depending on the risk level, should be established in the collective contract of the appropriate enterprise and the collective contract of the employer. However, according to the Ministry of Health there is not a good general system in place, in which all workers are given an opportunity to ask for and to get benefits for difficult and dangerous working conditions.

246.One of the governing principles of the Civil Service Regulation is that of equity, i.e. fair and equitable treatment of civil servants. In UNMIK Administrative Direction 2003/2 it is furthermore stated that the Ministry shall issue classification standards and salary rates applicable to positions in the civil service. Classification standards should be reviewed from time to time and at least every five years. This should be interpreted that there are existing legal provisions for a system that salaries are set on the basis of competence and level in a fair and equitable manner. Statistics from 2005 from the Statistical Office of Kosovo indicate that the average income earner in Kosovo received 2,032 Euro in salary. Kosovo Serbs earned only 1,400 Euro compared to 2,100 Euro for Kosovo Albanians. In general, women have significantly lower income than men. During 2005 men obtained 2,200 Euro whereas women only had 1,500 Euro per month. Some explanations for the difference could be that women work less hours than men or have less qualified work. There is no data for actual wages per hour, but there is data regarding income for permanent full time employees. Full time in this case is considered to be 12 months per year. An average income for 12 months employment is for men 2,850 Euro and for women 2,400 Euro. This shows that men earn almost 20% more than women for 12 months employment.

B. Decent living

247.During and after the NATO campaign in 1999, business organizations continued to pay wages, but within the public services no salaries were paid. During the 1990s, it is understood that the informal structures established by the Kosovo Albanians paid salaries, usually to teachers, in an amount of around 75‑80 Euro per month. Consequently, it was UNMIK’s top priority to pay salaries to those who would have to support the re‑starting of a normal life for people. This included areas of civil administration, health service, education and public utilities. In 1999 public service employees were paid stipends. From 1 January 2000 these were substituted by salaries based on a uniform public salary scale. UNMIK’s initiative to employ local staff in public services on the basis of work contracts was the first step towards the re‑establishment of a legal employment system. Salaries paid from the Kosovo ConsolidatedBudget on the salary scale were originally in the range of approximately 75 Euro per month for technical support staff to 300 Euro per month for local co‑directors of departments in the Joint Interim Administration System (JIAS). The average level of salaries was around 135 Euro per month for people employed on the basis of the general government budget. Hospital doctors and professors in schools were paid approximately 180 Euro per month. Later on, the salary of professors increased to around 500 Euro per month.

248.The Essential Labour Law sets out that all employers should pay their employees at least the minimum wage, as set by the Administrative Department of Public Services, or the authority that will succeed it. Furthermore, for those to which the General Collective Agreement applies, the employee is guaranteed a basic salary, even in situations where salaries are based on work results.

249.Regarding civil servants, UNMIK Administrative Direction 2003/2 states that the Ministry shall recommend to the Government and, upon approval of the Government, shall issue the classification standards and salary rates applicable to positions in the Civil Service. Salary rates may be reviewed from time to time by the Ministry in consultation with the Ministry for Finance and Economy and may be revised by the Ministry following approval by the Government. This provision should ensure that there is a regular review of the level of the salaries to ensure a decent living for civil servants.

C. Safe and healthy working conditions

250.Law No. 2003/19 On Occupational Safety, Health and the Working Environment, promulgated by UNMIK Regulation No. 2003/33 (the Occupational Safety Law) was promulgated 6 November 2003. The purpose of the Occupational Safety Law is to create conditions for occupational safety, health and the working environment in Kosovo. It accounts for the establishment of the Kosovo Council for Occupational Safety and Health. According to the Occupational Safety Law, employees have a right to elect and appoint a safety officer. Furthermore, the employee should have the right to refuse work if he/she believes that there isan imminent danger to his/her life and health and should also have a right to consult with the employer on all aspects of occupational safety, health and working environment associated with their work. In addition, the employee should have the right to make suggestions to improve the safety and health situation at the workplace and the employee should also have the right to report deficiencies and safety measures directly to a labour inspector. The Occupational Safety Law contains a separate section for the protection of young people, women and disabled people. It states that they should not be assigned to particularly hard manual work, work beyond working hours and night work. Finally there are a number of provisions benefiting employees regarding rest rooms, changing rooms, air pollution, drinking water, noise, vibration, lighting, electrical hazards, chemical products and fires.

251.As for civil servants, detailed provisions concerning terms of employment are to be set out in an administrative direction, which should include, inter alia, the right to a safe and healthy working environment. According to UNMIK Administrative Direction 2003/2 each employing authority shall ensure that civil servants have a safe and healthy working environment. Claims or grievances about the working environment should be directed to the personnel manager of the employing authority, and appealed to the Appeals Board. An Appeals Board shall be established by each employing authority to hear civil servants’ appeals against a decision of the Disciplinary Board and claims against other managerial decisions. The Appeals Board should be multi-ethnic and gender balanced and should as far as possible complete the hearings of a case within 30 days of its receipt.

252.According to the Ministry of Labour and Social Welfare, the most common irregularities from the procedures as evidenced by employers are:

Disrespect of working hours

Non-signing of work contracts

No regular payment of salaries

Disrespect of maternity leave (making pregnant employees redundant)

Non-fulfilment of normal working conditions (insufficient light, draught, humidity, extreme noise, radiation, lack of proper equipment for protection at work etc.)

253.There are three Occupational Health Institutes (OHIs) in Kosovo dealing with occupational health related issues. The first one is the OHI in Mitrovica South which deals with specific health hazards arising from the Trepca Industrial Complex, specifically lead poisoning. The second one is an OHI in Obiliq/Obilić which deals with specific health hazards arising from the generation of electricity at KEK and includes health checks for radiation poisoning. The third OHI is placed in Gjakovë/Đakovica and it deals with specific health hazards arising from the previously existing textile industries of Gjakovë/Đakovica and Prizren (apparently most of those industries are now closed). The OHI of Gjakovë/Đakovica was recently declared by the PISG to be the lead Occupational Health Institute for all of Kosovo. According to the Ministry of Health, this OHI only has diagnostic capability and could not truly fulfil the function of an occupational health authority. Each municipal primary health care centre (Health House or Ambulanta) has an occupational health office. However, according to the Ministry of Health, predominantly these offices provide generic family health care services rather than truly functioning as occupational health services.

D. Equal opportunity for promotion

254.There are no direct provisions in the Essential Labour Law on promotion in employment. However, there are some non-discrimination provisions. One states that it is prohibited to act with discrimination against a disabled person, whose prospects of securing, retaining and advancing in suitable employment are substantially reduced as a result of a duly recognized natural or mental impairment. Discrimination is also prohibited against a female employee when it arises from her pregnancy or childbirth.

255.According to the Civil Service Regulation one of the governing principles of the civil service should be that promotion should be only by means of fair, open and competitive procedures, based on objective, job‑related criteria. Furthermore in UNMIK Administrative Direction 2003/2 it is stated that all promotions should be based on an objective and considered decision as to the suitability of the civil servant,based on merit and other relevant criteria. Promotion opportunities should also be widely advertised and candidates should be selected following a competitive process. Furthermore, according to Administrative InstructionMSHP/DCSA 2003/12 there are procedures developed to ensure promotion of non‑discrimination through, inter alia, the development of Equal Opportunities Policy Statements.

256.There have been methods adopted to promote an objective appraisal of jobs on the basis of the work to be performed. In the Civil Service Regulation, it is established that employing authorities shall provide civil servants with annual written performance evaluations. Furthermore, according to Administrative Instruction MPS/DCSA 2003/08, the purpose of a job assessment is, inter alia, to review quality of performance against key tasks undertaken during the previous working year and to receive positive and, where appropriate, negative feedback on aspects of performance. It also includes information on the job assessment cycle, setting key tasks, managing day‑to‑day performance, mid‑year review of performance, formal review of performance, disagreement on job assessments and monitoring and evaluating the job assessment system.

E.Rest, leisure, periodic holidays with pay andremuneration for public holidays

257.In the Essential Labour Law working times, annual leave, official holidays, maternity leave, compassionate leave, unpaid leave and sick leave are regulated. Working hours should not exceed 40 hours per week and a working day should not exceed 12 hours. An employee should be entitled to a 30 minute unpaid rest break during a working day. When overtime takes place, there are limitations as to how long this is allowed and related remuneration. There are additional rules for limitation of work regarding people under 18 years of age, disabled people and pregnant women. An employee should be entitledto 18 working days of paid annual leave during each calendar year, except for the first year of employment when an employee should be entitled 12 working days of paid annual leave. An employee should be entitled to paid leave during official holidays. Furthermore a female employee should be entitled to at least 12 weeks paid maternity leave upon the birth of a child. An employee should be entitled to compassionate leave for marriage, birth or death in the family. An employer may, at the request of the employee, approve unpaid leave. An employee should also be entitled to sick leave when notifying the employer within 48 hours. If the sick leave relates to a work-related accident or illness, an employee should be entitled to his/her full salary for that period of leave.

258.For civil servants the standard hours of work are 40 hours per week, excluding rest breaks. Employees are entitled to a one hour break per eight hour work day and, in addition, a weekly rest period of at least 48 hours. Civil servants may work part-time as agreed with the employing authority. When overtime takes place there are limitations as to the time and rules set up regarding compensatory time off or remuneration. Similar to other employees, civil servants are entitled to 18 working days of paid annual leave during each calendar year, except for the first year of employment when an employee shall be entitled to 12 working days of paid annual leave. There is no legal provision stating the right for a civil servant to paid leave during official holidays. However, UNMIK Administrative Direction 2003/2 states that: “A civil servant shall not normally be required to work on official holidays. When a civil servant is required to work on official holidays he or she is entitled to a day off in lieu of each official holiday worked”. Unlike for other employees, civil servants are entitled to 15 days of paid sick leave irrespectively of if the sick leave is caused by occupational accidents or illness, or not. Female civil servants are entitled to 12 weeks of full paid maternity leave. Inasmuch as the details of this entitlement are concerned please refer to the discussion thereof under Article 10 of this Report. A civil servant should be entitled to compassionate leave for marriage and death of a close relative. A civil servant may be permitted to take unpaid leave for a maximum period of six months. Furthermore, Administrative Instruction MPS/DCSA 2003/10 establishes the possibility for the employer and the employee to agree on flexible working hours and part-time work. This is stated to include benefits of a better balance for staff between work and private lives and as a welcoming opportunity for mothers with young children.

Article 8

A. Constitutional and legislative framework

259.Inasmuch as the right to associate in trade unions is concerned - guaranteed also by UDHR, Article 20(1) and CCPR Article 22(1) - please refer to the discussion thereof in the UNMIK Report to the Human Rights Committee on the Human Rights Situation in Kosovo since June 1999 dated 13.03.2006 under Article 22(1), paragraphs 216 and the following.

260.The main legal acts by means of which the right to establish, join and operate trade unions is regulated in Kosovo are the following:

UNMIK Regulation No. 1999/22 On the Registration and Operation of Non Governmental Organizations in Kosovo of 15 November 1999 and

UNMIK Regulation No. 2001/27 On Essential Labour Law in Kosovo of 8 October 2001

261.The right to join trade unions for workers and civil servants is reiterated in:

UNMIK Regulation No. 2001/36 On the Kosovo Civil Service of 22 December 2001 (article 5 section 1), and

Law No. 2004/2 On Gender Equality in Kosovo, promulgated by UNMIK Regulation No. 2004/18 of 7 June 2004 (article 13 section 10)

262.Several draft Laws by means of which the trade union freedom will be regulated in more detail have recently been under consideration in the Assembly of Kosovo. A new labour Law has had its first reading on 16 November 2006. The draft Laws on strike, first reading 24 June 2005, and on freedom of association in trade unions in Kosovo, first reading 19 December 2005, once adopted and entered into force, will contain more specific legal provisions as regards the right to strike and the establishment and operation of trade unions for specific categories of employees.

B. Establishing, operating and joining trade unions

1. Establishing and operating trade unions

(a)General

263.Inasmuch as the substantive or formal conditions for the establishment of trade unions are concerned please refer to the discussion thereof at the UNMIK Report to the Human Rights Committee on the Human Rights Situation in Kosovo since June 1999 dated 13.03.2006 under Article 22(1), paragraphs 222 and 223.

264.Upon registration trade unions assume legal personality; this is regulated by UNMIK Regulation No. 1999/22. A draft Law on freedom of association in trade unions in Kosovo (the draft trade union Law) is also under consideration by the Assembly of Kosovo.

(b)Draft trade union law

265.In the future, the trade union freedom will be guaranteed and regulated by a Law on freedom of association in trade unions in Kosovo, which is currently under consideration by the Assembly of Kosovo.

(c)Collective agreements

266.In addition to the aforementioned laws, the area of operating of trade unions is further regulated by an agreement of general validity in Kosovo, the General Collective Agreement (GCA). This agreement, based on article 6 of UNMIK Regulation No. 2001/27, should have been implemented since 1 January 2005 but according to the MLSW certain provisions are not being implemented due to the lack of budgetary means.

267.The GCA stipulates that trade unions can be formed and operate freely at any employer bound by the GCA. The employer is obliged to ensure co‑operation with the trade unions regarding all procedures in the field of working relations, in accordance with ILO Convention No. 87. Employers are to ensure free access to the representatives of the trade union at their enterprise and freedom of trade union information and delivery and dissemination of trade union publications.

268.The GCA further provides that trade union representatives enjoy immunity which ends three months after the end of the representative’s term in office. Representatives of trade unions shall not be assigned a different job or made redundant. Without prior agreement from the trade union, the trade union representatives’ salaries cannot be reduced, and disciplinary procedures or damage compensation claims cannot be initiated. If the employer wishes to initiate such procedures, the trade union has eight days to decide, and, in case no agreement is reached, the employer can initiate a reconciliation procedure.

269.Furthermore, the Agreement stipulates rules regarding the establishment of labour relationships; rights, obligations and responsibilities of employer and employees; the assignment or reassignment to another position or another location of employees in extraordinarycircumstances; home‑work; redundancy compensation; working hours and night shift work; the right to paid and unpaid leave; the working place for persons with disabilities; annual and maternity leave; disciplinary procedures; safety and security at work; general rules for salary and other personal incomes; and rights and obligations of parties and method of dispute resolution.

270.Collective agreements can not only be concluded at the Kosovo level; but also at the branch level or level of an enterprise. The MLSW reports that they have registered two such collective agreements by (a) Kosovo Energy Corporation J.S.C. (KEK), and (b) Sharr Beteiligungs GmbH Factory (cement producing).

2. Joining trade unions

(a)Joining

271.Trade union freedom is guaranteed as part of the freedom of association, according to the Constitutional Framework and more specifically elaborated in UNMIK Regulations No. 2001/27 and 1999/22. Trade union freedom in Kosovo embraces both, the positive union freedom, meaning the right of individuals to become members of trade unions by their own choice, and the negative trade union freedom, covering the right to decide freely whether or not to join a trade union. This is similarly regulated in article 4.2 of the draft trade union Law.

272.Employees become a trade union member upon written request to the trade union, having personally signed a declaration to this end. The membership fee is 1% of the salary, non‑payment of it for a period of three months leads to cancellation of the membership. So far there are no cases of exclusion of trade union members for non‑payment. The unemployed and students pay a reduced membership fee of 1.00 and 0.20 Euro per month respectively.

( b ) Discrimination

273.The Union of Independent Trade Unions of Kosovo (BSPK) reports that since the end of the conflict in 1999 there has not been any discrimination towards any person wishing to join a trade union. The statute clearly proscribes any form of discrimination. Any employee, including members of minority communities in Kosovo, can join a trade union.

274.The BSPK currently has members from all communities. To further the integration of minority community employees, an aim stipulated in all its documents, the BSPK will implement a comprehensive project in 2007. This project, funded by the European Agency for Reconstruction (EAR), was drafted by professional staff of the BSPK with professional assistance of the Office for Social Dialogue in Pristinë/Priština. It aims to integrate and promote membership of minorities with a special focus on the Serbian minority in the trade unions structures and its leadership. It is focused on four main geographic areas: Gračanica/Graçanicë, Mitrovicë/Mitrovica, Gjilan/Gnjilane and Dragash/Dragaš.

275.As of December 2006, 19% of the overall number of 92,580 BSPK members were female. BSPK reports that it has held several seminars on the issue of female participation in trade unions. While there is no special project for raising the percentage of female participation, the issue has again been discussed at the BSPK managing council held in February 2007.

276.Another issue, discussed at the BPSK managing council was the participation of youth. The council approved the regulation on the BSPK youth network organisation with the aim of empowering and advancing the role of youth in the BSPK and of supporting the affirmative policies of the international trade union organizations International Confederation of Free Trade Unions (ICFTU) and European Free Trade Union Confederation (ETUC). The regulation determines the functioning, competences, and bodies as well as the relationship between the BSPK and the youth network, which is an internal organizational structure of the BSPK.

3. Limitations and restrictions

277.The BSPK reports that there were no institutional limitations on the work of trade unions in Kosovo. There were only a few cases of discrimination in practice. In some cases, the management of public enterprises did not treat trade unions as social partners, and did not allow them adequate space to carry out their activities by excluding trade union members from corporate boards. The UNMIK Non Governmental Organizations Registration and Liaison Unit reports that no NGOs, including no trade unions, have been denied registration in Kosovo since 1999. Nor have any NGOs had their registration suspended or revoked.

278.There are no laws regulating or limiting the right to associate in trade unions for employees working in UNMIK, KFOR, foreign governmental offices in Kosovo and international governmental organizations that work in Kosovo. Also, the scope of the draft trade union Law does not encompass regulation of this issue. Until now there are no trade unions active in these organisations.

279.There are no limitations regarding the right to establish and join a trade union for civil servants, including members of the Kosovo Police Service and the Kosovo Protection Corps.

280.There are no limitations for persons not qualifying as habitual residents of Kosovo, as set forth in section 3 of UNMIK Regulation No. 2000/13 On the Central Civil Registry of 17 March 2000. The relevant legislation including the Statute stipulates as the only requirement that the employment age has to be reached. Also the draft trade union Law contains no limitations on the nationality of members.

C. Trade unions and their links on the Kosovo-wide and international level

1. Number and structure of trade unions

281.The BSPK, established at the first Congress on 30 June - 1 July 1990, had previously been registered in the Register of the Federative Secretariat for Administration and Judiciary in Yugoslavia (no 2/3-054/1991-03, dated 7 May 1991). After the recent conflict it was registered in the registry of the MLSW (no 2/2000 dated 16 August 2000). Its internal organisation is governed by its Statute, in accordance with both the applicable law as well as ILO Conventions. The latest, fourth, congress of the BSPK was held on 16 December 2006.

282.The BSPK reports that as of 16 December 2006, there were 18 independent trade unions which are part of the BSPK in accordance with to Article 33 of the Statute:

Trade union of the agro complex

Trade union of the miners

Trade union of the energy sector

Trade union of the metalworkers

Trade union of the textiles

Trade union of small economy and handicraft

Trade union of trade, hotel and tourism

Trade union of construction and construction material

Trade union of forestry

Trade union of education, science and culture

Trade union of Kosovo administration

Trade union of communication connections of Kosovo

Trade union of the municipal and housing activities

Trade union of metallurgy

Trade union of wood and paper industry

Trade union of Kosovo Police Service

Trade union of health sector, and

Trade union of judiciary

283.The MLSW reports that in 2006 the following unions were registered with the ministry:

Branch of Independent Trade Union of Metallurgists of Kosovo

Independent Trade Union of Insurance Company “Kosova e Re”

Independent Trade Union of Pensioners and Labour Invalids of Kosovo

Independent Trade Union of Small Economy and Craftsmanship of Kosovo

Hotelier and Tourism Independent Trade Union of Kosovo

Independent Trade Union of Textile and Leather Shoes Industry of Kosovo

Independent Trade Union of Metal Processing lists of Kosovo

Trade Union of Electro-Energetic Employees of Kosovo

Independent Trade Union of Forestry, Wood and Paper Industry in Kosovo

Independent Trade Union of Education, Science and Culture

Independent Trade Union of Agronomy of Kosovo

Transport and Post-telecommunication of Kosovo

Trade Union Federation of Health in Kosovo

Independent Trade Union of Administration and Justice of Kosovo

Independent Trade Union of Reconstruction and Planning in Kosovo

Independent Trade Union of Kosovo Police

Independent Trade Union of KEK

Independent Trade Union of Control Services of Air Transport

Independent Trade Union of Police Service of Kosovo

Independent Trade Union of Construction of Kosovo

Independent Trade Union of Municipal and Housing Activities

Independent Trade Union of International Airport of Prishtina

Independent Trade Union of Civil Servants of Kosovo and

Independent Trade Union of Radio Television for Prishtina

284.Independent trade unions declaring themselves as representing Kosovo Serbian workers registered with MLSW are:

Independent Trade Union of Education Committee in Kosovo and

Independent Trade Union on Accomplishment of the Rights of Employees

2. Kosovo wide confederations

285.The applicable law does not contain specific provisions regarding the linking of trade unions. However, the MLSW reports that every confederation which is created by the unification of two or more independent trade unions can apply for registration in MLSW. The registration procedure within the MLSW is governed by Administrative Instruction No. 22/2001 on the registration of trade unions.

286.The draft trade union Law provides for the establishment not only of independent trade unions, but also of federations and confederations. Federations are unions of independent trade unions whereas confederations are trade union associations consisting of several federations. Currently, there is only one Kosovo wide federation of trade unions, the BSPK.

3. International level

287.The issue of international links is not explicitly regulated in the Kosovo legal framework. As for the future, article 5 paragraph 2 of the draft Law on freedom of association in trade unions in Kosovo grants the right to unite and co-operate with international trade union organisations.

288.Over the last years, the Kosovo Government actively assisted trade unions in their endeavours to join international trade union organisations. Assistance was mainly provided through the tripartite advisory council established by the MLSW according to Annex VII (x) of UNMIK Regulation No. 2001/19. According to Administrative Instruction No. 17/2001 on the structure and function of the tripartite advisory council the council consists of:

Five representatives of trade unions, including one representative of Serb workers

Five representatives of employers organisations, including one Serb employer and

Five representative of the PISG, including two from the Ministry of Labour and Social Welfare

289.The advisory council assists trade unions in the process of joining international organisations. It assisted the BSPK in joining the Brussels based International Trade Union Confederation (ITUC) through the secondment of experts and consultants as well as giving advice. It also supported other independent trade unions, members of the BSPK, which joined international trade unions confederations as follows:

Trade union of the Agro complex of Kosovo - registered with the IUF (International Union of Food, Agricultural, Hotel, Restaurant, Catering, Tobacco and allied Workers’ Associations) and the ICM

Trade union of the Kosovo Metalworkers - registered with the European Metal Workers Federation (EMF) and International Metal Workers Federation

Trade union of the Textiles, Clothes and Leather - registered with the World Confederation of the Textile, Clothes and Leather

Association of the Trade Union - registered with Education International (EI)

Trade union of the energy sector - registered with the European Mine Chemical and Energy Workers Federation (EMCEF) and

Trade union of the Miners of Kosovo - registered with the European Mine Chemical and Energy Workers Federation (EMCEF)

290.There are no cases in which the Government proscribed any international co-operation or joining of trade unions in international, European or regional trade union confederations.

D. Right to strike

291.There are no laws regulating the right to strike explicitly. Section 5.2 of UNMIK No. Regulation 2001/36, proscribing the right to strike for certain categories of civil servants, confirms by way of an argumentum a contrario that the legislator guarantees the general right to strike.

292.Based on article 40 of the Statute, trade union members have different categories of trade union pressure, including the means of strike, at their disposal. The Statute stipulates that they can use the following types of trade union pressure to exercise their rights:

Developing social dialogue

Writing a warning and ask for mediation with assistance of a third party

Writing a request for realising their goals in accordance with positive provisions

Initiating a procedure to the competent body regarding the contest

Taking a decision on the use of (more robust) trade union pressure

Boycott

Organising a protest (demonstrations) and

Organising a strike

293.The strike is considered the ultimate means of trade union pressure and is used only when all other means for resolving the dispute, respectively social dialogue, have been used to no avail.

294.According to section 5.2 of UNMIK Regulation No. 2001/36 civil servants employed with the police, correctional and emergency services (i.e. Kosovo Protection Corps) and any other category of civil servants whose services are declared by the Government to be essential, shall not strike or take any other industrial action, which may disrupt essential services.

295.The Ministry of Internal Affairs’ department of internal security foresees in its 2007 working plan, following the approval of the police Law, to draft acts and normative regulations in the field of police work which will include a strategic plan for the situation in case police officers strike.

296.In practice, strikes, including in the public sector, have taken place. In the public sector, areas affected included the health, education, administration, and public corporation sector. From 1999 to 2006, BSPK reports that there are no data on punishment or dismissal of workers against those workers that have participated in strikes.

297.A strike is considered legal, if it is organised by a registered trade union, its purpose is the fulfilment of economic and social interests deriving from work, and the trade union and the employers’ organisation have tried but failed to find an agreement on the contentious subjects following the lawful procedures.

298.A strike shall be announced by the strike council to the employer at least 7 days in advance. The announcement shall contain the reasons for the strike, the demands and the time and place where it will be held. A strike can be organised in an enterprise, part of an enterprise, at the employer, in a branch, in an activity or as a general strike. The decision to take industrial action shall be done by the corresponding organ of the trade union at the respective level.

299.Workers shall not be discriminated for organising and participating in a legal strike nor shall they be prevented from participating in any way. The strike council has the obligation to organise and lead the strike and to prevent threats to the safety and health of people.

300.A strike shall not be held or must be suspended in case of extraordinary circumstances (natural disasters, state of war or emergency) as long as these circumstances last.

301.Essential work obligations necessary for the functioning of organs and organizations which shall be carried out even during the period of strike shall be determined in a general collective agreement, respectively a collective agreement on branches’ level. The competent organs must take measures in order to prevent a direct risk, or extraordinary negative consequences for human life, people’s health, people’s safety, the safety of property as well as other avoidable consequences.

302.The draft Law stipulates the following services of vital importance, where the use of the means of strike is proscribed:

Indispensable medical and hospital services

Water supply services

Electricity power supply services

Air traffic control services

Services for protection against fire and

The prison service

303.In case of an illegal strike, the employer may terminate the working relationship with the striker. He has the right to terminate the working contract with immediate effect with those employees that do not continue the work within three days.

Article 9

A. Emergency phase

304.Immediately following the termination of the conflict in June 1999, there wasan urgent need to provide some form of social protection system. Given that most Kosovo Albanians had lost their jobs within the public, publicly-owned and socially-ownedsectors of employment, they had also lost their claims to pension and social assistance entitlements under Yugoslav law. The loss of employment included the termination of the payment of employee and other contributions into pension and social welfare systems.

305.The first UNMIK budget for Kosovo envisaged immediate financial assistance to some 72,000 persons at a flat rate of 100 DM per month (circa 51 Euro). The category of beneficiaries included pensioners, orphans, widows and persons with disabilities.The numbers of targeted beneficiaries increased during the remainder of 1999 to over 100,000 and the rate of assistance decreased commensurately to 70 DM (circa 36 Euro). Financial assistance was directed at the most in need, including persons over the age of 70, single-parent families and persons with disabilities. In the second half of 2000, the emergency assistance scheme was extended to include unemployed parentswith dependents.

Table 33

Emergency social assistance payments as budgeted in Euroa

Total payments

In % of budget

1999 (1 Sep through 31 Dec)

10 225 838

16

2000

38 346 891

17.4

2001

41 414 642

14.4

Source: UNMIK budget schedules 1999, 2000, and 2001.

a The original amounts in Deutsche Mark have been converted for clarity’s sake into Euro at the official exchange rate of 1.95583 DM per EUR. The official exchange rate is given in UNMIK Administrative Direction No. 2001/24 of 21 December 2001.

B. Legal arrangement of the social security system

306.The main legal acts that regulate the right to social security and related social insurance in Kosovo are:

UNMIK Regulation No. 2000/66 On Benefits for War Invalids of Kosovo and for the Next of Kin of those who Died as a Result of the Armed Conflict in Kosovo of 21 December 2000

UNMIK Regulation No. 2001/35 On Pensions in Kosovo of 22 December 2001, as amended by UNMIK Regulation No. 2005/20 of 29 April 2005

Law No. 2002/1 On the Methodology for Setting the Level of Basic Pension in Kosovo and Determining the Commencement Date for Provision of Basic Pensions, promulgated by UNMIK Regulation No. 2002/15 of 26 July 2002

Law No. 2003/23 On Disability Pensions in Kosovo, promulgated by UNMIK Regulation No. 2003/40 of 17 December 2003

Law No. 2003/15 On the Social Assistance Scheme in Kosovo, promulgated by UNMIK Regulation No. 2003/28 of 18 August 2003

Law No. 2004/4 On Health, promulgated by UNMIK Regulation No. 2004/31 of 20 August 2004

C. Social welfare system

307.Social security in Kosovo is in a very early stage of development. It presently includes benefits for the war invalids and survivors benefits, old-age benefits (basic pension and individual savings pension) and social assistance.

308.In order to benefit from the system of social security, a person must be a habitual resident of Kosovo. The right to register as a habitual resident of Kosovo belongs to the following categories: (a) persons born in Kosovo or who have at least one parent born in Kosovo; (b) persons who can prove that they have resided in Kosovo for at least a continuous period of five years; (c) other persons who were forced to leave Kosovo and for that reason were unable to meet the five years residency requirement; and (d) dependent children of Kosovo habitual residents.

309.All the social protection schemes are financed from the Kosovo Consolidated Budget, with the exception of the second and third pillar of the old-age pension scheme. Healthcare in public institutions is also fully financed by the Kosovo budget, but the users of health services need to pay participation fees.

Table 34

GDP, social assistance and pensions (from 2000-2007)

Description

2000Est.

2001Est.

2002Est.

2003Est.

2004Est.

2005Est.

2006Proj.

2007Proj.

Real growth rates(inpercent)GDP

...

...

-2.5

2.4

3.2

-1.0

3.0

0.8

Main aggregates(inmillions of Euros) GDP

1 504

2 220

2 246

2 313

2 308

2 222

2 257

2 250

GDP per capita(in Euros)

826

1 189

1 182

1 197

1 174

1 112

1 111

1 088

Budget expenditures

204

239

402

543

748

698

676

718

As a share to GDP

13.6

10.8

17.9

23.5

32.4

31.4

29.9

31.9

Social Welfare(in millions of Euros)

n/a

33.5

52.9

84.7

106.2

114.0

116.9

War Invalids

n/a

n/a

2.9

7.4

4.6

4.8

5.3

Basic pensions

n/a

n/a

17.9

44.4

54.9

60.1

62.4

Disability pensions

n/a

n/a

n/a

n/a

12.8

15.5

15.6

Trepca pensions

n/a

n/a

n/a

0.7

1.5

2.5

3.0

Social Assistance

n/a

33.5

32.1

32.2

32.5

31.1

30.6

Social assistancein % of the budget

n/a

14.0

13.2

15.6

14.2

16.3

17.3

War Invalids

n/a

n/a

0.7

1.4

0.6

0.7

0.8

Basic pensions

n/a

n/a

4.5

8.2

7.3

8.6

9.2

Disability pensions

n/a

n/a

n/a

n/a

1.7

2.2

2.3

Trepca pensions

n/a

n/a

n/a

0.1

0.2

0.4

0.4

Social Assistance

n/a

14.0

8.0

5.9

4.3

4.4

4.5

Social assistancein % of GDP

1.5

2.4

3.7

4.6

5.1

5.2

War Invalids

n/a

n/a

0.1

0.3

0.2

0.2

0.2

Basic pensions

n/a

n/a

0.8

1.9

2.4

2.7

2.8

Disability pensions

n/a

n/a

n/a

n/a

0.6

0.7

0.7

Trepca pensions

n/a

n/a

n/a

0.0

0.1

0.1

0.1

Social Assistance

n/a

1.5

1.4

1.4

1.4

1.4

1.4

Source: Ministry of Finance and Economy.

Est. = estimation, Proj. = projection

Table 35

Statistics for pensions - social schemes

Kinds of schemes

2001

2002

2003

2004

2005

2006

Subventions andtransfers

40 500 000

59 201 976

Basic Pensions

-

-

43 435 542

43 260 000

60 690 000

62 512 000

Pensions for disabled persons

-

-

12 600 000

12 600 000

13 900 000

Pensions for war veterans

-

-

4 410 000

5 155 656

7 200 000

Early pensions (Trepça)

-

-

1 260 000

1 770 000

2 820 000

Social assistance Scheme

-

28 251 231

32 625 000

33 000 000

28 668 000

Social services

-

235 255

250 000

800 000

2 550 000

Total

40 500 000

59 201 976

71 922 028

94 405 000

114 015 656

117 650 000

Source: Ministry of Finance and Economy (MFE).

D. War invalids and survivors benefits

310.The legal framework for war invalidity and survivors benefits in Kosovo is set by UNMIK Regulation No. 2000/66 which provides special arrangements for the benefit of the war invalids of Kosovo and for the benefit of the next of kin of those who died as a result of the armed conflict in Kosovo. Persons entitled to war invalids and survivors benefits are only persons who qualify as habitual residents of Kosovo. The Regulation provides for a definition of a war invalid as any person who has received a physical injury as a direct result of the armed conflict in Kosovo, while for the purpose of the Regulation, the armed conflict in Kosovo is deemed to have occurred between 27 February 1998 and 20 June 1999. The terms “war invalids” and “those who died as a result of the armed conflict in Kosovo” cover combatants, including members of the former Kosovo Liberation Army (KLA), and civilians.

311.Benefits provided for war invalids and for the next of kin of those who died as a result of the armed conflict in Kosovo include: (a) Financial payments for war invalids; (b) Free access to the medical care provided in government health centres and rehabilitation centres in Kosovo for war invalids and their next of kin; (c) Exemption from sales tax, excise tax and customs duties on vehicles adapted for the specific disability of the war invalid; and (d) Financial payments for the next of kin of those who died as a result of the armed conflict in Kosovo.

312.UNMIK Administrative Direction (AD) No. 2001/19, implementing UNMIK Regulation No. 2000/66 determines the categories of next of kin entitled to the survivors’ benefits: a child or children under the age of 18 of the deceased person; and the spouse of the deceased person. Moreover, the AD defines payment levels for those who enjoy benefits. There are five payment levels determined:

Table 36

Payment levels for war invalids and their next of kin

Criteria

Payment levels set by ADa at:

1

War invalids with 70%-100% disability

150 DM; now payable 77 Euro

2

War invalids with 40%-69% disability

100 DM; now payable 52 Euro

3

Children who have no surviving parent

150 DM; now payable 77 Euro

4

Spouse with responsibility for children

120 DM; now payable 62 Euro

5

Spouse with no children

70 DM; now payable 36 Euro

a Annex to UNMIK Administrative Direction No. 2001/19.

313.The Ministry of Labour and Social Welfare (MLSW) administers the war invalids and survivors benefits in Kosovo. In 2006, the MLSW issued Administrative Instruction (AI) 08/2006 on the Work of the Medical Commission Regarding Evaluation and Determination of Invalidity of KLA War Invalids and Civil Invalids. The AI establishes the medical commission for evaluation, medical assessment of ability, and determination of invalidity level of KLA war invalids and civilian invalids. This commission is established as a two-level commission within the Department of Martyrs’ Families, War Invalids and Civil Invalids of the MLSW. The decision of the second level commission may be subjected to judicial review.

314.Currently, financial payments are being made to war invalids and survivors in Kosovo as follows:

315.There are 122 war invalids and 147 civilian invalids of war in Kosovo with 70%-100% disability, at payment level 1. There are 1,327 war invalids and 1,247 civilian invalids of war with 40%-69% disability, at payment level 2. To payment level 3 are entitled 277 beneficiaries. Payment level 4, is at the moment being paid to 2,397 beneficiaries in Kosovo. To payment level 5 are currently entitled 1,952 persons in Kosovo.

316.The following tables show statistical data about payment of benefits for the war invalids of Kosovo and the next of kin of those who died as a result of the armed conflict in Kosovo.

Table 37

War invalids and their family members registered and paid in 2004(breakdown by months and regions)

Months

Regions

Total

Prishtinë/ Priština

Gjilan/ Gnjilane

Prizren

Pej ë/Peć

Mitrovicë/ Mitrovica

January

Registered

2 095

697

1 554

1 880

1 758

7 984

Paid

1 518

509

1 281

1 497

1 393

6 198

February

Registered

2 134

709

1 591

1 921

1 792

8 147

Paid

1 541

514

1 300

1 529

1 411

6 295

March

Registered

2 148

719

1 610

1 955

1 811

8 243

Paid

1 562

519

1 318

1 552

1 432

6 383

April

Registered

2 175

730

1 639

1 972

1 845

8 361

Paid

1 582

524

1 332

1 561

1 444

6 443

May

Registered

2 207

735

1 647

1 997

1 846

8 432

Paid

1 600

530

1 345

1 578

1 449

6 502

June

Registered

2 249

739

1 652

2 015

1 866

8 521

Paid

1 628

534

1 351

1 593

1 464

6 570

July

Registered

2 258

742

1 664

2 031

1 874

8 569

Paid

1 634

535

1 360

1 601

1 472

6 602

August

Registered

2 262

745

1 666

2 051

1 884

8 608

Paid

1 646

539

1 363

1 610

1 480

6 638

September

Registered

2 272

756

1 668

2 074

1 923

8 693

Paid

1 651

539

1 363

1 614

1 486

6 653

October

Registered

2 308

761

1 688

2 096

1 931

8 784

Paid

1 666

541

1 379

1 631

1 492

6 709

November

Registered

2 342

769

1 705

2 126

1 940

8 882

Paid

1 684

544

1 389

1 655

1 497

6 769

December

Registered

2 369

777

1 714

2 150

1 952

8 962

Paid

1 701

548

1 394

1 669

1 503

6 815

Source : Statistical Office of Kosovo (SOK).

317.According to the figures from December 2004, the number of war invalids registered was 8,692, whereas the number of those being paid was 6,815.

318.Considering the distribution per region, the biggest number of invalids was registered in Prishtinë/Priština region with 2,369 persons. The smallest number of invalids was registered in Gjilan/Gnjilane region with 777 persons. During 2004, the number of invalids registered increased by 1,131 persons, or an increase of 12.6%, whereas the number of invalids paid increased by 709 persons, or an increase of 11.6%.

Table 38

War invalids and their relatives in 2004 (breakdown by age and months)

Months

Age

Total

0 >18

18-25

26-35

36-45

46-55

56-65

>65

January

Registered

140

540

1 624

1 908

1 596

1 248

928

7 984

Paid

102

349

1 286

1 615

1 271

893

682

6 198

February

Registered

145

556

1 657

1 962

1 619

1 268

940

8 147

Paid

104

355

1 308

1 647

1 285

906

690

6 295

March

Registered

146

565

1 680

1 986

1 634

1 283

949

8 243

Paid

107

364

1 328

1 664

1 301

918

701

6 383

April

Registered

150

577

1 703

2 019

1 652

1 301

959

8 361

Paid

109

366

1 337

1 684

1 313

927

707

6 443

May

Registered

155

585

1 713

2 033

1 675

1 305

966

8 432

Paid

114

372

1 345

1 700

1 327

932

712

6 502

June

Registered

161

596

1 731

2 055

1 688

1 312

978

8 521

Paid

120

378

1 358

1 716

1 339

938

721

6 570

July

Registered

167

603

1 741

2 061

1 694

1 318

985

8 569

Paid

124

383

1 364

1 720

1 343

940

728

6 602

August

Registered

169

608

1 748

2 071

1 700

1 324

988

8 608

Paid

126

385

1 373

1 728

1 349

948

729

6 638

September

Registered

173

619

1 769

2 094

1 712

1 336

990

8 693

Paid

127

387

1 381

1 738

1 355

953

712

6 653

October

Registered

174

628

1 798

2 114

1 725

1 349

996

8 784

Paid

128

393

1 397

1 751

1 365

959

716

6 709

November

Registered

176

637

1 824

2 143

1 739

1 362

1 001

8 882

Paid

128

402

1 414

1 773

1 374

963

715

6 769

December

Registered

182

647

1 837

2 160

1 754

1 372

1 010

8 962

Paid

129

406

1 422

1 785

1 381

970

722

6 815

Source: SOK.

Table 39

War invalids according to community belonging of applicants in 2004

Months

Kosovo Albanian

Kosovo Serb

Total

Total

F

M

F

M

F

M

January

4 025

2 151

17

5

4 042

2 156

6 198

February

4 073

2 199

17

6

4 090

2 205

6 295

March

4 113

2 246

17

7

4 130

2 253

6 383

April

4 132

2 287

17

7

4 149

2 294

6 443

May

4 159

2 319

17

7

4 176

2 326

6 502

June

4 181

2 365

17

7

4 198

2 372

6 570

July

4 202

2 376

17

7

4 219

2 383

6 602

August

4 218

2 396

17

7

4 235

2 403

6 638

September

4 224

2 406

17

6

4 241

2 412

6 653

October

4 253

2 433

17

6

4 270

2 439

6 709

November

4 284

2 461

17

7

4 301

2 468

6 769

December

4 308

2 483

17

7

4 325

2 490

6 815

Source: SOK.

Table 40

War invalids according to gender and total payment in 2004

Months

Number of persons registered

Total

Total payment(in Euro)

M

F

January

2 156

4 042

6 198

375 558 00

February

2 205

4 090

6 295

364 383 50

March

2 253

4 130

6 383

375 985 25

April

2 294

4 149

6 443

370 348 25

May

2 326

4 176

6 502

377 272 25

June

2 372

4 198

6 570

380 534 75

July

2 383

4 219

6 602

376 355 25

August

2 403

4 235

6 638

379 626 25

September

2 412

4 241

6 653

380 250 25

October

2 439

4 270

6 709

387 742 25

November

2 468

4 301

6 769

397 688 25

December

2 490

4 325

6 815

387 073 75

Source: SOK.

Table 41

War invalids and their family members registered and paid in 2005 (breakdown by months and regions)

Months

Regions

Total

Prishtinë/Priština

Gjilan/Gnjilane

Pejë/Peć

Prizren

Mitrovicë/Mitrovica

January

Registered

2 388

780

2 156

1 728

1 961

9 013

Paid

1 708

552

1 675

1 402

1 507

6 844

February

Registered

2 398

784

2 175

1 742

1 974

9 073

Paid

1 722

556

1 692

1 412

1 517

6 899

March

Registered

2 421

790

2 193

1 752

1 985

9 141

Paid

1 742

561

1 703

1 417

1 523

6 946

April

Registered

2 434

794

2 216

1 772

1 992

9 208

Paid

1 753

563

1 719

1 425

1 524

6 984

May

Registered

2 446

799

2 235

1 784

2 011

9 275

Paid

1 768

564

1 734

1 438

1 536

7 040

June

Registered

2 465

804

2 243

1 790

2 022

9 324

Paid

1 785

566

1 741

1 440

1 547

7 079

July

Registered

2 472

805

2 252

1 794

2 028

9 351

Paid

1 791

568

1 750

1 443

1 553

7 105

August

Registered

2 472

805

2 252

1 794

2 028

9 351

Paid

1 791

568

1 749

1 443

1 552

7 103

September

Registered

2 486

809

2 270

1 807

2 036

9 408

Paid

1 794

572

1 766

1 450

1 556

7 138

October

Registered

2 499

812

2 293

1 813

2 045

9 462

Paid

1 801

575

1 785

1 454

1 557

7 172

November

Registered

2 511

814

2 307

1 815

2 058

9 505

Paid

1 814

578

1 799

1 456

1 569

7 216

December

Registered

2 544

815

2 321

1 822

2 072

9 574

Paid

1 848

578

1 810

1 465

1 585

7 286

Source: SOK.

Table 42

War invalids and their family members in 2005 (breakdown by age and months)

Months

Age

Total

>18

18-25

26-35

36-45

46-55

56-65

>65

January

Registered

147

536

1 797

2 164

1 822

1 424

1 123

9 013

Paid

108

342

1 344

1 798

1 440

1 009

803

6 844

February

Registered

148

538

1 809

2 187

1 831

1 429

1 131

9 073

Paid

109

345

1 357

1 812

1 451

1 017

808

6 899

March

Registered

149

543

1 833

2 199

1 845

1 440

1 132

9 141

Paid

111

347

1 368

1 825

1 458

1 028

809

6 946

April

Registered

150

550

1 847

2 216

1 856

1 451

1 138

9 208

Paid

113

349

1 373

1 836

1 467

1 035

811

6 984

May

Registered

153

558

1 859

2 238

1 869

1 457

1 141

9 275

Paid

115

358

1 382

1 856

1 477

1 039

813

7 040

June

Registered

154

561

1 876

2 250

1 876

1 463

1 144

9 324

Paid

116

360

1 393

1 866

1 486

1 043

815

7 079

July

Registered

156

561

1 883

2 258

1 880

1 465

1 148

9 351

Paid

117

359

1 403

1 874

1 491

1 044

817

7 105

August

Registered

156

561

1 883

2 258

1 880

1 465

1 148

9 351

Paid

116

359

1 403

1 874

1 491

1 044

816

7 103

September

Registered

158

570

1 894

2 271

1 895

1 470

1 150

9 408

Paid

117

363

1 408

1 883

1 503

1 048

816

7 138

October

Registered

162

575

1 909

2 288

1 903

1 475

1 150

9 462

Paid

118

368

1 419

1 895

1 507

1 052

813

7 172

November

Registered

162

577

1 921

2 306

1 910

1 478

1 151

9 505

Paid

119

370

1 429

1 914

1 513

1 055

816

7 216

December

Registered

165

579

1 936

2 316

1 920

1 497

1 161

9 574

Paid

123

373

1 444

1 923

1 522

1 075

826

7 286

Source: SOK.

Table 43

War invalids according to community belonging in 2005

Months

Kosovo Albanians

Kosovo Serbs

Total

Total

Female

Male

Female

Male

Female

Male

January

4 326

2 494

17

7

4 343

2 501

6 844

February

4 358

2 517

17

7

4 375

2 524

6 899

March

4 387

2 535

17

7

4 404

2 542

6 946

April

4 411

2 549

17

7

4 428

2 556

6 984

May

4 449

2 567

17

7

4 466

2 574

7 040

June

4 469

2 586

17

7

4 486

2 593

7 079

July

4 476

2 604

18

7

4 494

2 611

7 105

August

4 475

2 603

18

7

4 493

2 610

7 103

September

4 496

2 617

18

7

4 514

2 624

7 138

October

4 521

2 626

18

7

4 539

2 633

7 172

November

4 544

2 647

18

7

4 562

2 654

7 216

December

4 584

2 677

18

7

4 602

2 684

7 286

Source: SOK.

Table 44

War invalids according to gender and total payment in 2005

Months

Number of registered

Female

Male

Total

Total payment

January

4 343

2 501

6 844

386 001.75 €

February

4 375

2 524

6 899

394 403.25 €

March

4 404

2 542

6 946

394 723.25 €

April

4 428

2 556

6 984

393 558.25 €

May

4 466

2 574

7 040

399 041.75 €

June

4 486

2 593

7 079

403 446.25 €

July

4 494

2 611

7 105

407 311.75 €

August

4 493

2 610

7 103

434 795.25 €

September

4 514

2 624

7 138

458 886.25 €

October

4 539

2 633

7 172

443 301.75 €

November

4 562

2 654

7 216

421 675.25 €

December

4 602

2 684

7 286

423 817.00 €

Source: SOK.

E. Old-age and disability benefits

1. General

319.This group of benefits envisages the right to a basic pension.

320.The legal framework regulating pension insurance in Kosovo is provided by UNMIK Regulation No. 2001/35 On Pensions in Kosovo of 22 December 2001, as amended by UNMIK Regulation No. 2005/20 of 29 April 2005. In addition, Law No. 2003/23 On Disability Pensions in Kosovo, promulgated by UNMIK Regulation No. 2003/40 of 17 December 2003, introduces a disability pension scheme for the purpose of creating a social safety net, which provides adequate minimum protection for the most vulnerable members of society.

321.Pension is defined as a regular monthly payment made to a participant or beneficiary for life, beginning at pension age, disability or death of the participant. Pension age is set at sixty‑five (65) years.

322.The new post-conflict pension system in Kosovo, introduced in December 2001, consists of three pillars:

Table 45

Structure of pensions in Kosovo

Pillar 1Basic Pension (mandatory)

Pillar 2Individual Savings Pension (mandatory)

Pillar 3Employer or Individual Pension (voluntary)

Eligibility andcoverage

All habitualresidents ofKosovo over 65

Contributors,gradual expansion

Contributors,very limited

Contribution rate

-

5% employee5% employer

Varies

Funding method

General revenueof the Kosovobudget

FundedPayroll contributions

Funded byemployer and/orindividualcontribution

Participation

Mandatory

Mandatory

Voluntary

Benefit level

Monthly rate

Definedcontribution

Definedcontribution

Provider

Kosovo PensionAdministration

Kosovo PensionSavings Trust

Licensed Pensionfunds, insurance companies, banks

Regulatory or Oversight bodies

Ministry ofLabour andSocial Welfare,Central FiscalAuthority

Banking andPayments Authorityof Kosovo

Banking andPaymentsAuthority ofKosovo

323.The first pillar is the basic old-age pension provided for all habitual residents of Kosovo who have reached pension age (65 years). The basic pension is financed from general budget resources. The Kosovo Pension Administration, under the authority of the MLSW, administers the basic pension scheme.

324.The second pillar is a mandatory, fully funded, defined-contribution pension scheme financed by mandatory payroll contributions from employees and employers, each contributing 5% of total gross wages (additional voluntary contributions are allowed up to a maximum total of 15% of annual salary). The Kosovo Pension Savings Trust, established as an independent legal entity is the sole body responsible for administering and managing individual accounts for savings pensions. The Trust is supervised by the Central Banking Authority of Kosovo (CBAK). However, the setting of economic policy with respect to pensions, as a part of budgetary and fiscal policy, remains under the direct supervision of the SRSG.

325.Individual savings pension is defined as a pension paid by the Kosovo Pensions Savings Trust to persons of pension age (65 years), meeting the requirements with respect to pension contributions. Upon reaching a pensions age, a participant will use the amount on his/her individual account to purchase an individual saving pension, in one of the forms of annuities, provided by licensed insurance companies.

326.The types of annuity are the following:

A single life annuity payable until the death of the participant

A single life annuity guaranteed for a period of at least five years whereby if the participant dies during the guarantee period, the outstanding payments which would have been paid to the participant for that period shall be paid to beneficiaries designated by the participant

A survivor’s annuity payable for the life of the participant and then to his or her spouse for the remainder of his or her life

A survivor’s annuity payable for the life of the participant and then to his or her spouse for the reminder of his or her life with a guarantee period of at least five years

Such other types of annuity as are specified in rules issued by the CBAK.

327.Participation in the system of individual savings pensions became mandatory for public sector employees in March 2002 and was extended to cover all employers including

self‑employed persons in March 2003. Employers are obliged to make contributions for a savings pension for all persons habitually residing in Kosovo who were born in the year 1946 or later.

328.The third pillar is a voluntary pension scheme. It is the responsibility of the CBAK to license and supervise the operation of this scheme, as contributions are transferred to private pension providers (pension funds, insurance companies, or banks). In the voluntary scheme are included: supplementary employer pensions, that is pensions provided to employees by an employer in accordance with statutory requirements; and supplementary individual pensions, that is pensions for individual natural persons purchased from pension providers in accordance with statutory requirements.

329.The Ministry of Finance and Economy transfers general revenues to the Pension Administration to finance the basic pension in accordance with appropriations made by the SRSG. The amount of the basic pension is set according to the methodology adopted by the Kosovo Assembly, such that the same rate applies to all qualified old-age pensioners.

330.Kosovo Assembly Law No. 2002/1 On the Methodology for Setting the Level of Basic Pension in Kosovo, and Determining the Commencement Date for Provision of Basic Pensions, promulgated by UNMIK Regulation No. 2002/15 of 26 July 2002 (the Law), established the methodology for setting the amount of basic pension and determined the commencement date for providing basic pensions.

331.According to the Law, basic pensions are being paid in Kosovo effective from 1 July 2002. Eligible pensioners applying to the Kosovo Pension Administration after 31 October 2002 are receiving payments effective from the beginning of the month in which such application is made. For the year 2002, the rate of the basic pension was set by the Law at 28 Euro per month. The Law envisaged that for the subsequent years the rate of the basic pension shall be set annually based on the value of the minimum-calorie food basket containing 2,100 calorie needs per day per adult, which costs 0.925 Euro per day or 27.75 Euro per month.

332.In 2003 the amount of basic pension was 35 Euro, while since 2004 this amount has increased to 40 Euros. The current number of basic pension beneficiaries is: 127.991.

333.The following data about payment of basic pensions in Kosovo are received from the Statistical Office of Kosovo (SOK).

Table 46

Pensioners registered and total payment for 2004

Registered number of pensioners

Months

Female

Male

Total

Total payment ( in Euro)

January

58 678

50 064

108 742

3 876 648 00

February

59 196

50 470

109 666

5 005 485 00

March

59 632

50 807

110 439

4 510 460 00

April

59 873

50 989

110 862

4 488 267 00

May

60 290

51 398

111 688

4 524 089 00

June

60 745

51 897

112 642

4 588 038 00

July

61 141

52 295

113 436

4 584 398 00

August

61 497

52 666

114 163

4 609 600 00

September

61 855

53 047

114 902

4 642 520 00

October

62 170

53 330

115 500

4 659 678 00

November

62 535

53 608

116 143

4 690 296 00

December

62 920

54 012

116 932

4 733 080 00

Source : SOK.

334.According to the data received by SOK concerning the number of persons registered, the majority were female with 62.920, equivalent to 54%, whereas registered males were 54.012, or 46%.

Table 47

Pensioners by regions and months for 2004

Months

Region

Total by gender

Total

Prishtinë/ Priština

Gjilan/ Gnjilane

Pejë/ Peć

Prizren

Mitrovicë/ Mitrovica

Male

Female

January

Registered

26 344

23 679

21 383

23 267

19 149

52 904

60 918

113 822

Paid

24 979

22 527

20 374

22 321

18 541

50 064

58 678

108 742

February

Registered

26 586

23 842

21 595

23 436

19 277

53 345

61 391

114 736

Paid

25 331

22 608

20 544

22 435

18 748

50 470

59 196

109 666

March

Registered

26 855

24 057

21 784

23 609

19 563

53 885

61 983

115 868

Paid

25 568

22 779

20 625

22 573

18 894

50 807

59 632

110 439

April

Registered

27 062

24 297

22 012

23 768

19 689

54 335

62 493

116 828

Paid

24 353

24 281

20 720

22 613

18 895

50 989

59 873

110 862

May

Registered

27 319

24 536

22 212

23 968

19 891

54 887

63 039

117 926

Paid

25 942

23 101

20 858

22 728

19 059

51 398

60 290

111 688

June

Registered

27 615

24 817

22 413

24 220

20 090

55 534

63 621

119 155

Paid

26 217

23 289

20 971

22 941

19 224

51 897

60 745

112 642

Table 47 (continued)

Months

Region

Total by gender

Total

Prishtinë/ Priština

Gjilan/ Gnjilane

Pejë/ Peć

Prizren

Mitrovicë/ Mitrovica

Male

Female

July

Registered

27 870

25 052

22 642

24 422

20 537

56 222

64 301

120 523

Paid

26 401

23 395

21 109

23 045

19 486

52 295

61 141

113 436

August

Registered

28 072

25 261

22 793

24 598

20 694

56 678

64 740

121 418

Paid

26 573

23 576

21 186

23 095

19 733

52 666

61 497

114 163

September

Registered

26 777

26 907

22 977

24 783

20 838

57 137

65 145

122 282

Paid

25 333

25 157

21 349

23 280

19 783

53 047

61 855

114 902

October

Registered

28 324

25 677

23 139

24 971

21 103

57 593

65 621

123 214

Paid

26 799

23 835

21 453

23 397

20 016

53 330

62 170

115 500

November

Registered

28 498

25 884

23 287

25 139

21 402

58 075

66 133

124 210

Paid

26 913

23 935

21 506

23 499

20 290

53 608

62 535

116 143

December

Registered

27 433

27 531

23 395

25 270

21 558

58 592

66 598

125 187

Paid

27 136

24 189

21 542

23 601

20 464

54 012

62 920

116 932

Source: SOK.

335.According to the data provided to SOK in December 2004, the number of persons registered for basic pensions was 125,187, whereas the number of pensions paid was 116,932. This means that the number of pensioners in 2004 has increased by 12,255 persons or 9.8% as compared to figures provided in December 2003.

Table 48

Pensioners registered by community belonging of applicants in 2004

Month s

Kosovo Albanian s

Kosovo Serb s

Total

F

M

F

M

F

M

January

47 569

41 285

11 109

8 779

58 678

50 064

February

47 906

41 543

11 290

8 927

59 196

50 470

March

48 199

41 758

11 433

9 049

59 632

50 807

April

50 454

44 717

12 039

9 618

62 493

54 335

May

48 713

42 222

11 577

9 176

60 290

51 398

June

49 040

42 575

11 705

9 322

60 745

51 897

July

49 243

42 812

11 705

11 898

60 948

54 710

August

49 411

42 998

12 08 6

9 668

61 497

52 666

September

49 704

43 330

12 151

9 717

61 855

53 047

October

49 857

43 469

12 313

9 861

62 170

53 330

November

50 077

43 623

12 458

9 985

62 535

53 608

December

50 282

43 834

12 638

10 178

62 920

54 012

Source: SOK.

336.The number of pensioners registered according to language of applicants shows that the majority is comprised of members of the Kosovo Albanian community with 94,116 persons, or 80%, including also the other communities in this percentage (except Kosovo Serb community), whereas from the Kosovo Serb community there ere 22,816 persons registered for basic pensions, or 20% of the total.

Table 49

Basic pensions according to regions and months in 2005

Months