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These legal practices are part of the acquis communitatire (the legal heritage of the European Union), and would need to be accepted in their entirety by Croatia before it joins the EU. Judicial reform, one of the areas which Croatia will need to address as part of the process of ascension, is of immense importance for two reasons: firstly, because it is a key prerequisite for joining the EU, and secondly, as it is widely regarded that it will contribute towards the further development of the country at the levels of the state, civil society and of the individual. For a potential EU member country such as Croatia, research into member states experiences with European Law is all the more important in light of the fact that the ECJ in Luxembourg doesnt examine new cases relating to issues on which it has previously ruled. It is important to note, however, that any comparison between Italy and Croatia on the issue of European law must be understood in the context of their differing status with regard the Union. Italy is subject to the Treaty of the EU, which created a new legal order. Croatia, on the other hand, has yet to have its Stabilization and Association Agreement ratified. Although, in the opinion of the ECJ, association agreements represent amendments to the EU Treaty, the Court still considers them one level below primary and secondary sources of EU law (e.g. the EU Treaty, acts produced by the European Council etc.). Therefore, association agreements do not produce the same amount of individual rights as primary and secondary sources of European law (Hartley, T.C. 1999). In that respect, most of the conclusions emerging from this article can only be considered as valid once Croatia becomes a full member of the EU. The first part of this article will highlight some important legal issues relating to a number of landmark Italian cases, which have important implications for the relationship between national and European law. In the second part, the current state of the legal relationship between Croatia and the EU will be presented. In the concluding section, by using examples from Italian-European legal practice, reforms will be suggested that could help Croatia in its on-going process of legal integration with the EU. The Italian Experience of European Law A basic principle of European law is that any European legal act, which has direct effect, carries prevalence over any national legal act. This principle has not been enshrined in any of the Treaties, but it has been proclaimed by the ECJ. Each directly effective European legal act (e.g. regulations, directives, decisions, etc.) carries precedence over national acts. This principle applies to all national acts regardless of their date and origin (Hartley, T.C. 1999). When a country joins the EU, it is obliged to adapt its Constitution to the demands placed upon it by membership of the EU. It is also required to introduce rules that will ensure the application of EU law on its territory, as well as which will ensure the primacy of EU law over national law. (Hartley, T.C. 1999). Unlike most other European Union member states, Italy did not make any constitutional changes prior to joining the EU. Instead, the Constitutional Court of Italy (CCI), as well as the other organs of the judiciary, chose to interpret the Italian constitution in a broad sense. An interpretation of this kind was possible since Article 10. of the Italian Constitution permitted the country to join international organizations. The legal basis for Italys membership of the European Community (EC), and later of the European Union (EU) was established by the passing of national-level laws. The practice of the Constitutional Court of Italy is of crucial importance in determining the status of European law within its internal legal order, given its function of co-ordinating and overseeing the integration of national and European legal systems. (Rodin, S. 1997A). One of the first cases relating to the application of European law in Italy was Costa v ENEL - presented to the Constitutional Court in 1964. The principle issue of this case related to a difference in the way that national law (passed after Italian entry into the EC), and EC Treaty approached the same issue. The fact that international contracts in Italy were (and still are) ratified through general legislative procedures, supported the popular interpretation at the time that international contracts were the same as regular law. This interpretation consequently contributed to the establishment of the principle that national lex posterior can override international treaties (lex posterior derogat legi priori). This principle is what the CCI referred to when it refused, in Costa v ENEL, to recognize the EC Treaty (1956) as a separate legal code from other international contracts. The ECJ, on the other hand, declared that unlike other international contracts, EC contracts can not be overruled by national legislatures, therefore establishing in Costa v ENEL, a general principle of the supremacy of all binding community law (Rodin, S. 1997A).The ECJ stated that the law that derives from the Treaty represents an independent source of law which, due to its specific origin and nature, cannot be invalidated by National legal acts (P. Craig; G. de Burca; 2003B). Declaring the supremacy of all binding community law was a landmark ruling by the ECJ. It prepared the ground for the evolution of the status of European law in Italy as well as in other member states. However, one has to keep in mind that within the EC Treaty, nothing has yet been codified relating to the relationship between National and European Law. Moreover, Italy and other member countries generally distinguish between two forms of European Law - firstly, the self-executing decrees and acts of the EC Treaty (e.g. regulations), and secondly, EC acts known as directives, which were not initially designed to produce a direct impact, due to the lack of direct basis in the EC Treaty. Given the above, it is interesting to note that as early as 1970, in the case between SACE v Minestero Finanze, EC directives which had not been incorporated into the national legal system within the given time limit, were implicitly accepted as having a direct impact by the CCI. Therefore, as a result of this case, delays in incorporating EC directives into national law represent a violation of Italys contracted obligation to the Treaty, and as such, could be subject to the jurisdiction of the ECJ (Rodin, S. 1997A). The ICIC case (1975) resolved a key legal problem. The CCI proclaimed it illegal for existing EC regulations to be copied into national laws, as these are de facto self-executing acts. This proclamation of the CCI was in line with the position previously taken by the ECJ in the Variola (1973) case (Rodin, S. 1997A). Both the Variola and ICIC, could serve as important showcases for Croatia once it joins the EU. In order to harmonise its legal system with that of the EU, Croatia is currently in the process of incorporating EU regulations into its national laws. These laws will have to be repealed once the country joins the EU, and according to the precedent of the ICIC and Variola cases, they will have to be replaced with the direct application of EU regulations in Croatia. The Frontini case (1973) is of key significance, primarily for what has become known as the Frontini Reserve. In this case, the CCI proclaimed that limitations on Italian state sovereignty imposed by the EC, are legitimate only in areas which are explicitly set out in the 1956 EC Treaty. More specifically, the Frontini case declared that European law can force the Italian national courts to revoke national laws that contradict European law; but, importantly, that this cannot apply to national laws that regulate the basic principles of the Italian constitution (Rodin, S. 1997A). In other words, if EU law were ever to be interpreted in a way that would violate the basic human rights guaranteed within the Italian constitution, the CCI would have to examine if the EU Treaty operates in accordance with the basic human rightsenshrined in the Italian constitution (Hartley, T.C. 1999). The position of the CCI in this regard, has not changed since this ruling. Therefore, in theory, the CCI can, in any relevant legal case, rule on the compatibility of any European legislation with the basic principles of the Italian constitution.The judiciaries of potential member states often refer to the principles underlying the Frontini Reserve. This is done in order to help set the limits to which they are prepared to allow European law to impact on their legal order (Rodin, S. 2003). This could be seen as a sign that potential member states are only partially along the path of harmonising their legal orders with European law. In 1978, the Italian case known as Simmenthal, demonstrated, once again, the practical implications for its members, of EC law with its principles of supremacy and direct effect. This case was referred to the ECJ, and their second pronouncement is of fundamental interest to the relationship between European and national law. The ECJ declared that national level courts must recognise the complete impact of European law. The significance of this was that national courts must reject any national law (legal principles) that contradicts European law, regardless of whether it represents lex posterior (Rodin, S. 1997A). The Doctrine of lex posterior derogat legi priori was abandoned as recently as 1984 in the Granital case, hence removing the biggest stumbling block to the relationship between Italian national and European law (Rodin, S. 1997A). More recently, a key case was Fratelli Costanzo (1989). Here the CCI declared that city administrations count among the bodies that must actively enforce directives (P. Craig; G. de Burca; 2003A). It was stated that decisions made by the ECJ are obligatory not only for Italian legal subjects and its judiciary, but also for the Italian State administration. Current state of Legal Relationship between Croatia and the EU Croatia signed the Stabilisation and Association Agreement with the EU and its member countries on 29th October 2001. The agreement gave Croatia the status of a potential candidate for the EU. The immediate goal of the agreement was to make Croatia an associate member of the EU within a six-year period. Although the agreement has yet to be ratified, the European Council in January 2002 adopted an interim agreement, which brought into force the economic regulations set out in the Stabilisation and Association Agreement. In order to fulfil the obligations stipulated in the aforementioned agreement, the Croatian government adopted a Programme of Implementation of the Agreement, and formed an executive body tasked to oversee the implementation of the Programme called the Council for Stabilisation and Association. In this chapter I will present conclusions made by Sinia Rodin in his recently published research paper on the transformation of the Croatian legal system during the association process (Rodin, S. 2003). In legal terms, the implementation of the agreement depends on a number of factors including; the legal status of the agreement in relation to the constitutional order of the EU and Croatia (including whether the agreements regulations can be directly applied in Croatian and the EU courts); the legal status of the bodies anticipated by the agreement (e.g. the Council for Stabilisation and Association); the legal status and legal force of the decisions produced by these bodies. Croatia, like most other candidate and potential candidate countries, in the main, interprets its association agreement in the same way as it interprets other international treaties. Therefore, these treaties are not immediately understood by potential member countries to the EU as producing direct effect or as being self-executive. The problem of direct effect and the self executing character of the association treaties, in general, is further complicated by the fact that the treaties themselves (including the Croatian agreement), call upon the states to apply EU law; taking into account the current state of acquis communitaire. The Croatian constitution (article 140.) prescribes a monistic principle in its understanding of law. State authorities, however, are currently experiencing problems suspending dualistic practices which are still present from the socialist era, and which, as a result, have had negative effects on the implementation of the aforementioned agreement with the EU. The Croatian judiciary is proving to be a particularly problematic branch of state authority, and is widely recognised as being in need of a radical reform. That view was expressed in the European Commissions first report on the Croatian process of stabilization and association, dated in April 2002. According to Sinia Rodin The Croatian Government's judiciary and legislative branches have so far taken the position described by Bleckmann; namely that the EU is a creation of international law. In Bleckmann's opinion, decisions made by bodies operating in the sphere of international law cannot find their direct application in national or EU legal systems, but rather, they need to be incorporated into national legal orders trough secondary legislation. This dualistic interpretation of the law is clearly visible in article 6. of the Croatian Law on the Implementation of the Stabilisation and Association Agreement. That article states that although the regulatory authority governing the Stabilisation and Association Agreement lies with the Croatian Government, decisions brought by the Council for Stabilization and Association (the executive body of the treaty) must be ratified by the Croatian Parliament. Decrees of that kind represent a departure from the constitutionally prescribed monistic principle according to which the Croatian judiciary should interpret law. Forthcoming Legal Transformation of Croatia and Italian Legal Practice Croatias associate, and eventual full membership of the EU, calls for the governments direct constitutional authority over the bodies engaged in European affairs. However, this direct constitutional authority also includes an obligation on the part of the Government to regularly inform the Parliament of activities undertaken in the field of European affairs. Current Croatian law is fertile ground for potential disputes between Government and the Parliament on who has the regulatory authority over the national-level bodies engaged in European affairs (Rodin, S. 2003). The shift in responsibility for the regulatory supervision over European affairs, from the legislative branch to the executive branch of government, is a process, which occurred in Italy, as well as in all other EU member states. This shift has facilitated the process of integration, and has been extremely beneficial given the constant expansion of European integration into new areas of state and civil life. In order to shorten the time period required for the implementation of directives, the Italian Government often requests the Italian Parliament the transfer of regulatory power over European affairs. This request for the transfer of authority is based on more than simply issues of efficiency. The handing of regulatory power to the Government is usually the only way for EU directives to be implemented in time, since parliamentary supervision usually results in a lengthy legislative change process (Rodin, S. 1997A). The transfer of responsibility over European affairs in Italy can be viewed not only in a horizontal sense (from Parliament to Government); but also in a vertical sense (from local to central government). The practice of the CCI has contributed to this vertical shift of power, since in disputes between local and central government, the Court in their rulings have predominantly favoured the central government (Rodin, S. 1997A). By merely implementing the material decrees of the Association and Stabilisation Agreement, Croatia will not progress very far in its integration process. The country will need to conduct a process of reform aimed at reconciling national and European law. That process should be aimed at changing the constitution in order for Croatia to create a proper legal base for joining to the EU, and to create an effective framework of national institutions dedicated to implementing an efficient integration strategy. The constitution of the Republic of Croatia foresees the legal basis for Croatian entrance into international organizations and alliances, as well as the transmission of some authorities derived from the Croatian Constitution to those organizations or alliances (Rodin, S. 1997B). Notwithstanding, it is clear that the current Croatian constitutional definition of state sovereignty is inadequately adjusted to meet the necessary conditions for membership of the EU (Rodin, S. 2003). In addition to changing the definition of state sovereignty adopted by Croatian constitution, it would be important for Croatia to change its overall understanding of what sovereignty means. The ruling of the Constitutional Court of Italy in the aforementioned Frontini case regarding the issue of sovereignty, could serve as an important guideline for Croatia on that issue. The CCI on that occasion supported the delegation of a certain level of normative authority from the Italian State to the EC, by emphasizing the bilateral nature of that delegation. The ruling stated that limitations to Italian sovereignty have been compensated by the powers obtained through the country's membership of the EC as a larger community of nations. The issue of efficiency, as clearly demonstrated in the Simmenthal case, is one of the central principles of the system of European law. For that reason Croatia will have to abandon its current practice of interpreting international self-executing contracts through supplementary normative regulation (Rodin, S. 2003). The Croatian Constitutional Court should be authorised to make competent decisions on the presence or absence of legal rules relating to general international public law. The Constitutional Court of Italy, for instance, is authorised to examine the compatibility of Italian laws with international customary law, while general principles of international law serve in Italy as a key criterion in the evaluation of the constitutionality of national laws (Rodin, S. 1997A). In order to become a full member of the EU, Croatia will require a tighter harmonisation of its constitutional legal process with that of the ECJ. That could be achieved through changes and supplements to the Constitutional law of the Croatian Constitutional Court, or by changes in the law relating to how courts operate. The content of these changes would refer to the application of the legal principle known as exceptio illegalitatis established in the aforementioned Simmenthal case. Exceptio illegalitatis could then be used by regular Croatian courts in cases of conflict between national and European law (Rodin, S. 2003). It is important to keep in mind that the CCI in the Simenthal case called for a centralized judicial review process to adjudicate in cases where national law conflicted with European law. As a consequence, the CCI would have complete control over exceptio illegalitatis. The ECJ refused such a position arguing that the national courts that first record a conflict must exercise exceptio illegalitatis. The Croatian judicial and state authorities should learn from this wording in order to avoid any similar confrontations with the ECJ. As demonstrated in the aforementioned Fratelli Costanzo case, European law is not limited to the judiciary branch of the government; it also affects the workings of the state administration. Croatia, therefore, needs to recognise and accept that fact by initiating a reform of its state administration. A further reform of the Croatian legal process is also required in order for the country to avoid disputes between national laws and secondary sources of European law at the Constitutional Court level in Croatia. That could arguably best be achieved by mainstreaming the principle that decisions made by the ECJ represent a source of Croatian law. Similar principles were accepted in Italian law after the declaration of the CCI in the case known as S.p.a. BECA in 1985 (Rodin, S. 2003). Conclusion Italy has crossed a classic evolutionary path from, initially, not differentiating between European law and international law in its legal practices, to the current situation where there is a clear separation between these two of legal codes. Unlike previously, Italian judicial authorities by and large accept the policies of the ECJ. The practice of the Constitutional Court of Italy shifted from a dualistic to monistic interpretation of the law. Moreover, the Court has come to recognise that there is more than one possible interpretation of any given law. Italy therefore serves as a good example of a country which has modified its overall understanding of law as a result of its practical experience with, and exposure to the effects of the European law. Once it joins the EU, Croatian interest will certainly be focused on avoiding confrontations with the Court in Luxembourg. That goal can best be achieved if Croatia, prior to formally joining the Union, undertakes legal and judicial reforms in line with the abovementioned Italian examples. Such reforms would need to focus on both material legislative changes, as well as on less tangible changes relating to domestic legal practitioners basic understanding of law. The aforementioned reforms will have to be implemented in a quick and efficient manner, and they will need to avoid the obstacles that confronted Italy and other full members as their legal systems evolved within the framework of European law. Unlike the process when Italy joined the EU, Croatia will be required to make changes to its constitution on the issue of state sovereignty. The country will also have to start practising a constitutionally prescribed monistic understanding of the law. The aforementioned legal and judicial reforms would enable Croatia to apply the principles of supremacy and direct impact immediately after it formally joins the EU. Literature: The Nature and Effect of EC law. // EU Law, Text, Cases and Materials / P. Craig; G. de Burca. 3rd ed. Oxford University Press, 2003A. p. 178-228. The Relationship between EC Law and National Law: Supremacy. // EU Law, Text, Cases and Materials / P. Craig; G. de Burca. 3rd ed. Oxford University Press, 2003B. p. 275-315. Pravo zajednice i dr~ave lanice. // Temelji prava Europske zajednice / T.C. Hartley. 3rd ed. Rijeka: Pravni fakultet Sveu iliata u Rijeci, Open Society Institute, Constitutional and Legal Policy Institute, 1999. p. 193-335. Ustavno pravo dr~ava lanica i lanstvo u Europskoj uniji. // Europska integracija i ustavno pravo / Siniaa Rodin. 1st ed. Zagreb: Institut za meunarodne odnose, 1997A. p. 117-203. Kriteriji lanstva u Europskoj uniji i ustavno pravo Republike Hrvatske. // Europska integracija i ustavno pravo / Siniaa Rodin. 1st ed. Zagreb: Institut za meunarodne odnose, 1997B. p. 207-221. Rodin, S. Pridru~ivanje Hrvatske Europskoj Uniji: Preobrazba pravnog sustava. Pridru~ivanje Hrvatske Europskoj Uniji / Ott. K. (ed.). Zagreb: Institut za javne financije, Zaklada Fridrich Ebert, 2003. p. 213-233. Summary: The Italian Experience of European Law- Lessons for Croatias process of integration into the European Union The first part of presentation will briefly examine the evolution of the status of European law in the internal legal order of Italy. The second part will identify some important challenges that are facing Croatia (which is aspiring for membership of the EU) in its dealings with the European law. The presentation will argue that Italys experience with the European law can be seen as a useful guideline for Croatia. Italy has crossed a classic evolutionary path from, initially, not differentiating between European law and international law in its legal practices, to the current situation where there is a clear separation between these two of legal codes. The Constitutional Court of Italy has played an important role in the transition from a dualistic to a monistic understanding of law. Unlike most other EU member states, Italy did not make any constitutional changes prior to joining the EU. Instead, the Constitutional Court, and the rest of the judiciary, chose to interpret the Italian constitution in a broad sense. This allowed them to more easily accept the European Court of Justice's doctrines of direct effect and direct application of European law. This presentation will outline some key legal aspects of the following cases: Costa v E.N.E.L., SACE v. Ministero Finanze, ICIC, Variola, Frontini, Simmenthal and Fratelli Costanzo, which changed the understanding of European law in Italy, and which established the general foundations for the relationship between European and National law. The Treaty of Stabilization and Accession signed in 2001 between Croatia and the EU together with its member countries represents a first major step in a process that intends to eventually make Croatia a full member of the EU. The treaty is a transitional instrument that will allow Croatia to gradually accept acquis communautaire - legal heritage of the EU. The Croatian constitution prescribes a monistic principle in understanding of the law. However, state authorities have problems in suspending dualistic practices still present from previous times, which as a result, has had negative effects on the implementation of the aforementioned treaty. 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Full membership in the EU will demand from Croatia the implementation of constitutional changes, as well as some additional national legal changes.  Hrvoje Butkovi is Research Assistant at the Department for Culture and Communication Institute for International Relations (IMO), Ul. Lj, F. Vukotinovica 2, 10 000 Zagreb, Croatia. Author is currently enrolled in Postgraduate Master Studies; Croatia and Europe at the Faculty of Political Science, University of Zagreb. This paper was presented at the Advanced issues of Europena Law seminar, IUC, Dubrovnik, 29 February -7 March 2004.  This conception of society has been taken over from W. Adamson's definition of civil society in Adamson, W. Gramsci and the Politics of Civil Society. Praxis International. 7, 3-4 (1988).  The ECJ on the other hand in a series of recent cases proclaimed decrees otQgd*yf various European Agreements for self-executive (P. Craig; G. de Burca; 2003A).  That view has been also repeated in Comission's second report; Croatia SEC (2003) 341.  Blackmann, A. Europarecht. 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