An agreement would give Serbia and Montenegro access to EU financial aid. The European Commission linked the start of the negotiations with a feasibility study on Serbia and Montenegro prepared by Finnish EU enlargement commissioner Olli Rehn. European sources said this contained "a lot of conditions," some of which are linked to the Balkan state's economy.

The European Central Bank, for instance, expects a positive signal for foreign investors. However, the main condition relates to the cooperation of Serbia with the International Criminal Tribunal for the Former Yugoslavia (ICTY) in The Hague.

Solana praises cooperation

EU foreign policy chief Javier Solana last week praised Serbia's recent cooperation with the UN war crimes court.

"We hope very, very much that we will continue with the same commitment that we have seen in the last period of time," he said. "You know the importance the European Union and the international community as a whole attaches to this point."

A total of 13 Serbian or Bosnian Serb officers have surrendered to the ICTY during the past several months after Serbia came under intense international pressure for failing to work closely with the court.

Belgrade under pressure

Belgrade is still under pressure to help track down Bosnian Serb wartime military chief Ratko Mladic and Bosnian Serb political leader Radovan Karadzic, wanted for the 1995 massacre in the eastern town of Srebrenica, where Bosnian Serb forces killed some 8,000 Muslim males in the worst atrocity in Europe since World War II.

"Karadzic and Mladic have to stand trial," the Commissioner Rehn said on Tuesday, adding that no one can even begin thinking about an EU membership for Serbia and Montenegro until the country fully cooperates with the ICTY.

The EU has shown it is not prepared to compromise on the question of war crimes in the former Yugoslavia with EU foreign ministers refusing to open membership talks with Croatia as scheduled on March 17 due to its failure to help find a war crimes fugitive, former General Ante Gotovina.

Politicians in Serbia and Montenegro, a loose federation of the two former Yugoslav republics that was set up in 2003, hope the EU's feasibility study will help them gain political points at home if it comes to a positive conclusion.

Improved relations

Last week, Serbia's deputy prime minister, Miroljub Labus, visited Germany and France in a bid to drum up support for his country. He said on his return that the atmosphere between Belgrade, Berlin and Paris had improved considerably over the last six months.

"I expect the European Union to produce a positive feasibility study," he said. "Both Germany and France want to support us technically, diplomatically and financially so that we can achieve our agenda."

This agenda is dubbed "Europe 2012." In seven years' time at the latest, Serbia and Montenegro wants to be a part of the European Union -- despite the huge problems that still exist in the federation. Only last week, EU foreign policy chief Javier Solana had to mediate between the governments of the two sister-republics, which were squabbling over technical details.

The publication of the feasibility study has already had to be postponed once, so the European Commission will clearly be at pains not to send out the wrong signals to the Balkan state when it takes its decision on Tuesday.