The country follows in the footsteps of Croatia and Macedonia, which already have SAAs with the EU. All western Balkan countries were promised eventual EU membership in 2000, but various problems have held them back.
Olli Rehn, the EU enlargement commissioner, said in Strasbourg that the Commission had approved a feasibility study concluding that Serbia and Montenegro is ready to assume what he called a "contractual relationship" with the EU.
Rehn said the SAA is the country's first step toward Europe. "This is the beginning of the European road for Serbia and Montenegro. The country has achieved a great deal over the past few years and it is time to move on," Rehn said.
Rehn noted that the political and economic reforms in Serbia and Montenegro, though fragile, are sufficient to negotiate an SAA. He praised the country's adoption last week of a constitutional charter.
Rehn said SAA talks would be different from accession talks. Countries in the western Balkans have been promised membership. But last year’s enlargement has been followed by a surge of skepticism among EU citizens regarding further expansion in the future.
Rehn said SAA talks with Serbia and Montenegro can start as soon as the 25 EU-member states give the Commission a negotiating mandate. He said he expects this to happen within the next few months. The talks themselves are likely to take about a year.
Rehn also said that like other countries in the region, Serbia and Montenegro must show full cooperation with the International Criminal Tribunal for the former Yugoslavia in The Hague.
Rehn said cooperation so far has been satisfactory: "I am glad that Serbia and Montenegro has finally made significant progress in cooperating with the Hague tribunal. So far this year a dozen persons indicted for war crimes have boarded the plane to The Hague -- the latest one last week and another will do so this week."
Rehn stressed, however, that the trend must continue. Drawing an implicit parallel with Croatia -- whose EU entry talks were delayed last month over a single fugitive war crimes suspect -- Rehn said Serbia and Montenegro's accession talks cannot considered until there is full cooperation with ICTY.
The process, he said, holds huge symbolic significance for the bloc: "With the 10th [anniversary of the] Srebrenica [massacre] approaching in July this year, Radovan Karadzic and Radko Mladic must be brought to justice. This is the only way to achieve reconciliation and move further towards EU accession."
Rehn also indicated Serbia and Montenegro must be prepared to play a constructive part in talks about resolving the future status of Kosovo:
"This feasibility study is giving a positive signal at a critical moment when we need to engage Belgrade in constructive discussions on the future status of Kosovo. The progress of Serbia and Montenegro will help to stabilize the region and work for the security of all of Europe," Rehn said.
Agencies say the Serbian president Boris Tadic announced on Tuesday that he will invite his Kosovo counterpart Ibrahim Rugova to Belgrade for talks.
Rehn said that a signed SAA between the EU and Serbia and Montenegro could gradually lead to unrestricted access to the bloc’s single market, as well as free trade. It would also commit Serbia and Montenegro to align its laws to EU standards and offer wide-ranging cooperation in justice and immigration matters. It would also lead the way to close political dialogue with Brussels.
Rehn said that future advances in the relationship are in the hands of Serbia and Montenegro - the country’s speed of integration with Europe depends on the speed of its political, economic and judicial reforms, as well as cooperation with ICTY.