The Community provides assistance for Albania, Bosnia and Herzegovina, Croatia, the Federal Republic of Yugoslavia and the Former Yugoslav Republic of Macedonia.

Most of this Community assistance is currently provided under Council Regulation (EC) No 1628/96 of 25 July 1996 relating to aid for Bosnia and Herzegovina, Croatia, the Federal Republic of Yugoslavia and the Former Yugoslav Republic of Macedonia (OBNOVA) and under Council Regulation (EEC) No 3906/89 of 18 December 1989 on economic aid to certain countries of Central and Eastern Europe (PHARE). This means that the Community assistance is subject to different sets of procedures, which encumbers management. In the interests of efficiency it is therefore desirable to establish a single legal framework for this assistance, as requested by the European Council at its meeting in Helsinki on 10 and 11 December 1999. It is therefore appropriate to repeal Regulation (EC) No 1628/96 and to amend Regulation (EEC) No 3906/89. However, in order to ensure the continuity of the activities of the European Agency for Reconstruction, the provisions of Regulation (EC) No 1628/96 which concern the establishment and operation of the Agency should be incorporated into a new Regulation, which should enter into force on the date of that repeal.

The European Council, meeting in Lisbon on 23 and 24 March 2000, confirmed that its overall objective remained the fullest possible integration of the countries of the region into the political and economic mainstream of Europe and that the stabilisation and association process was the centrepiece of its policy in the Balkans.

The European Council, meeting in Feira on 19 and 20 June 2000, recognised the countries concerned by the stabilisation and association process to be potential candidates for EU membership.

The existing Community assistance should be expanded and redirected to adjust it to the European Union's political objectives for the region and, particularly, to contribute to the stabilisation and association process and increase the responsibility of recipient countries and entities in relation to that process.

To that end Community assistance will be focused mainly on building up an institutional, legislative, economic and social framework directed at the values and models subscribed to by the European Union and on promoting a market economy, with due regard for priorities agreed with the partners concerned.

A precondition for receiving assistance is that the recipients respect democratic principles, the rule of law, human and minority rights, fundamental freedoms and the principles of international law.

The regional dimension of Community assistance should be given special attention, with a view to stepping up regional cooperation and supporting the European Union's role as a driving force within the Stability Pact.

In view of the political situation in some areas and the nature of the various entities that have responsibility for implementing assistance there, it is desirable to provide that the assistance can be supplied in some cases directly to recipients other than the State.

To make Community assistance more effective and ensure it is properly implemented, the Commission should adopt general guidelines, in accordance with the management procedure laid down in this Regulation, taking into account the objectives of reform of external aid.

To promote cooperation within the region, provision should be made for the candidate countries and, on a case-by-case basis, the countries covered by the TACIS and MEDA programmes to participate in the tendering procedures and contracts.

Provision should be made for checks and for the protection of the Community's financial interests, inter alia by enabling the Commission, including the European Fraud Prevention Office (OLAF), and the Court of Auditors to exercise their respective powers pursuant to Council Regulation (Euratom, EC) No 2185/96 of 11 November 1996 concerning on-the-spot checks and inspections carried out by the Commission in order to protect the European Communities' financial interests against fraud and other irregularities and Council Regulation (EC, Euratom) No 2988/95 of 18 December 1995 on the protection of the European Communities' financial interests.

The Community assistance should be governed by a strategy framework and by annual and multiannual programming, which will be put to the management committee set up by this Regulation for an opinion. This will situate the assistance within a medium-term outlook and will make it possible to ensure that it complements and remains consistent with that of the Member States.

The measures necessary for the implementation of this Regulation should be adopted in accordance with Council Decision 1999/468/EC of 28 June 1999 laying down the procedures for the exercise of implementing powers conferred on the Commission.

In the case of the Federal Republic of Yugoslavia, provision should be made for the Commission to be able to delegate implementation of assistance programmes to the European Agency for Reconstruction.

In the light of the scope of this Regulation, consequent changes will need to be made to Council Regulation (EEC) No 3906/89 of 18 December 1989 on economic aid to certain countries of Central and Eastern Europe (PHARE), to Council Decision 97/256/EC of 14 April 1997 granting a Community guarantee to the European Investment Bank against losses under loans for projects outside the Community (Central and Eastern European countries, Mediterranean countries, Latin American and Asian countries, South Africa, the Former Yugoslav Republic of Macedonia and Bosnia and Herzegovina), to Council Decision 1999/311/EC adopting the third phase of the trans-European cooperation scheme for higher education (Tempus III) (2000 to 2006) and to Council Regulation (EEC) No 1360/90 of 7 May 1990 establishing a European Training Foundation.

The operations covered by this Regulation are part of the Community's Western Balkans policy and are needed to implement one of the Community's objectives.

The Treaty does not provide, for the adoption of this Regulation, powers other than those under Article 308,