Stark warning to new EU members

By Oana Lungescu BBC correspondent in Brussels

The European Commission is warning the 10 countries set to join the EU next spring that they could be punished unless they take immediate action to remedy persistent problems.

In a series of reports being published on Wednesday, Poland is singled out as the worst prepared among the 10 prospective members, which are mostly from the former communist bloc.

With only six months to go before the EU's historic eastwards expansion, the European Commission is putting all prospective members on notice.

Those countries have already made tremendous changes, but the reports still show some 40 areas of serious concern, where all 10 countries have to take immediate and decisive action.

Tiny Slovenia comes top of the class, with only one major shortcoming, but Poland, the biggest applicant country, is the worst prepared, with nine areas to tackle.

Strict rules

Delays in setting up the proper systems to handle EU funds could lose Polish farmers billions of euros.

Many dairy and meat plants may have to close if they do not get a clean bill of health.

"We are going to be extremely firm on the principle," said European Commission spokesman Jean-Christophe Filori. "Those establishments that don't meet EU standards will not be able to sell their products in the EU."

Expansion will go ahead and the Commission says it is determined to make it a success. It lists a range of possible sanctions, from withholding subsidies to issuing fines and export bans.

Privately, EU officials admit that the applicants have been scrutinised more closely than existing member states. From next year, when regular monitoring stops, countries like Poland could be tempted to break EU rules just as much as France or Germany.

According to draft conclusions seen by the BBC, the European Commission will be more generous than expected towards Romania, saying for the first time that it can be considered a functioning market economy.

It will hold out the prospect for Romania and Bulgaria to sign an accession treaty in 2005, allowing them to join the EU two years later.

But it will tell Turkey that, although it has made significant progress in political reforms, it still falls short of EU standards.

The report also warns that the absence of a settlement for the divided island of Cyprus could become a serious obstacle to Turkey's aspirations to begin EU entry talks by 2005.