Montenegro has submitted a request for funding worth €97.32 million under the European Union’s Reform and Growth Facility after reporting the completion of 34 reform milestones. The request is included in the government’s fourth semi-annual implementation report, which covers reforms with a total potential value of €117.02 million.
The European Commission will now assess whether the reported measures have been fully implemented and whether they meet the conditions required for payment approval. The evaluation will include a review of legislation, administrative evidence, operational capacity and measurable results.
Government Reports Completion of 34 Reform Milestones
According to Montenegro’s assessment, 34 reform measures have been fully completed, representing potential EU support of €97.32 million, while seven additional measures worth €19.70 million have been classified as partially completed. The reported figures represent a government assessment and do not constitute an approved EU payment. Funding under the facility depends on verification by the European Commission, which can reduce or delay payments if reforms are considered incomplete or if institutional requirements are not fulfilled.
Of the 10 milestones due by June 30, 2026, Montenegro reported nine as completed and one as partially completed. The report also includes progress on 25 delayed milestones from earlier periods. These include two measures originally scheduled for February 2025, five from June 2025 and 18 from December 2025.
All seven milestones carried over from February and June 2025 have now been reported as completed. Of the 18 measures originally planned for completion by the end of 2025, 12 have been completed and six remain partially implemented. The government also reported early completion of five milestones scheduled for December 2026 and one milestone originally planned for June 2027.
EU Facility Allocation Includes Grants and Loans
The reported value of completed measures, €97.32 million, represents more than 25% of Montenegro’s total €383.5 million allocation under the Reform and Growth Facility.
The final payment will be adjusted due to Montenegro’s previous 7% pre-financing received in May 2025. A mechanical calculation based on this adjustment would reduce the theoretical value of the completed milestones to approximately €90.5 million, although the final amount will depend on the European Commission’s validation process.
Montenegro’s 2024–2027 financial envelope under the facility consists of:
- €110 million in grants
- €273.5 million in concessional loans
Loans represent more than 71% of the total package, meaning that while financing conditions are favourable compared with commercial borrowing, the funds still create future repayment obligations.
The allocation is divided between:
- €178.5 million for direct budget support
- €205 million for infrastructure investments, mainly through the Western Balkans Investment Framework
Infrastructure and Public Sector Reforms Included in Programme
The previous EU-approved assessment covered 20 reform milestones valued at €44.2 million, including €20.6 million for the state budget and €23.6 million for infrastructure projects.
The latest request is more than twice the value of the earlier assessment. Among the reported completed reforms are measures related to risk management and internal audit systems in state-owned enterprises. The government also reported progress in strengthening Montenegro’s electricity market links with the European market.
Energy market integration includes alignment with European rules, improved market operation and conditions supporting cross-border electricity trading and renewable energy development.
Other completed measures include:
- introduction of an electronic cadastre
- measures targeting the informal economy
- alignment with European digital identity requirements
- adoption of an air-quality management strategy
- operationalisation of national and government computer incident response teams
Digitalisation Reforms Advance but Business Registration System Not Fully Operational
Montenegro reported progress in digital public administration through the creation of an electronic registration module within the Integrated Revenue Management System and the introduction of online tax payment functionality. The business registration platform has not yet entered full production because authorities and banks have not finalised arrangements related to transaction charges.
Technical work is also continuing on connecting Montenegro’s register with the European Business Registers Interconnection System. Until the system becomes fully operational, businesses and foreign investors will not have complete access to remote company registration and electronic settlement of taxes, fees and other public charges.
Regulatory Reform and Cybersecurity Capacity Remain Areas Under Development
The government acknowledged that ministries continue to face challenges in applying regulatory impact assessment procedures consistently. The Reform Agenda requires new legislation to undergo consultations with businesses, civil society and local authorities, alongside assessments of economic and administrative effects.
Montenegro has also established the Cybersecurity Agency under the Law on Information Security, adopted initial internal regulations and started supervisory activities. The agency, however, is not yet fully staffed.
Rule of Law Measures Remain Partially Completed
Several partially completed milestones relate to rule of law and fundamental rights. Montenegro has not yet established a unified database covering at least 95% of domestic violence cases reported to police or social welfare institutions. The country also needs to establish three crisis centres connected with recommendations under the Istanbul Convention.
Additional outstanding measures include investigations into alleged mistreatment of detainees and prisoner complaints, as well as structured activities for prisoners, including work, education, recreation and sports. Almost €7 million is linked to two of these measures. The government also reported improved results in investigations, indictments, court decisions and asset confiscation related to organised crime and corruption.
Commission Review Will Determine Final Payment Amount
Montenegro’s Reform Agenda contains 130 milestones covering the business environment, private sector development, digitalisation, the green and energy transition, human capital, rule of law and fundamental rights. The government’s latest report indicates progress on a large number of measures, but the final value of the next EU payment will depend on the European Commission’s verification of implementation, institutional capacity and measurable outcomes.
