Serbian parliament adopted resolution authorising government to enter talks with Kosovo Albanians on province’s final status. Serbia sought international support for stance with high-level visits to Russia and China: President Tadic put to Russian President Putin proposal to reshape Kosovo within Serbia along dual entity model of Bosnia; warned of destabilisation if independence granted. In first PM visit to Zagreb since 1991, Kostunica pledged with Croatian PM to resolve legacy of 1991-95 conflict,

EU  opened  Stabilisation  and Association Agreement negotiations 11 October. Montenegro PM Djukanovic said will not postpone spring independence referendum despite EU pressure, but may amend voting rules. Trial of “Vukovar 3” suspected of war crimes in Croatia started in Hague. U.S. Assistant Sec. State Burns said lack of progress on capture of war crimes suspects Mladic and Karadzic blocking improved relations with U.S., EU and NATO. Serbian war crimes court charged 5 Scorpion paramilitaries for 1995 crimes while Serb police arrested 9 fellow officers over 1999 Kosovo killings. Violence broke out at Serbia-Bosnia football match, injuring 19.

PM Kostunica appointed hard-liner Sanda Raskovic-Ivic as new head of Kosovo coordination centre, who called for Serbs to leave UNMIK structures and provisional government. Belgrade began purge of “disloyal” Serbs from Serbian-controlled municipalities in Kosovo. Defence Minister Prvoslav Davinic offered resignation 8 September over high profile corruption scandal involving purchase of unnecessary equipment at inflated prices. Supreme Court Judge Ljubomir Vuckovic and Deputy Prosecutor Milan Radovanovic arrested 15 September in aggressive move against corruption in judiciary. Head of Montenegrin Interior Ministry’s General Criminal Division, Slavoljub Scekic, assassinated 30 August in Podgorica. U.S. told Serbia that Ratko Mladic must be transferred to Hague, while EU threatened to delay Stabilisation and Association Agreement negotiations.

Provocations by Serbian Orthodox Church led to sharp deterioration in relations with Macedonia and Montenegro. Belgrade seized aircraft from Macedonian Airlines and shut border crossing to prevent Macedonians celebrating national day at Prohor Pcinjski monastery. Army airlifted aluminium Serbian Orthodox church to site at top of Mt. Rumija holy to Orthodox, Catholics and Muslims, causing sharp Montenegrin government response. Belgrade accused of planning Serbian Autonomous Region in northern Montenegro reminiscent of similar regions created as precursors to war in Croatia and Bosnia. Hague Tribunal fugitives Milan Lukic and Dragan Zelenovic arrested in Argentina and Russia respectively. U.S. presented draft agreement to move troops across Serbia-Montenegro in case of emergency in Kosovo; signed but unlikely to be ratified by parliament. Government dropped criminal charges against son and wife of Slobodan Milosevic. Bomb thrown at home of Hungarian minority politician in Vojvodina.

Serbian government published statement condemning all war crimes before 11 July Srebrenica memorial, attended by Serbian President Tadic. 8 former secret police convicted for kidnap and murder of former President Stambolic, including man accused of masterminding 2003 assassination of Serbian PM Djindjic. Montenegrin PM Djukanovic called for referendum on independence between February and April 2006. NATO Secretary General de Hoop Scheffer and Serbia and Montenegro (SCG) Foreign Minister Draskovic signed agreement on land lines of communication across SCG territory to enable faster reaction in event of unrest in Kosovo; Serbian government claimed wrongly bypassed in decision made by SCG.

Serbian politics dominated by war crimes issue. Video shown in Hague Milosevic trial 1 June, rebroadcast throughout Serbia, directly linked Serbian Interior Ministry “Scorpions” unit to 1995 Srebrenica massacre, bringing condemnation from PM Vojislav Kostunica and President Boris Tadic; yet parliament failed to adopt resolution condemning massacre. Government denied media speculation was negotiating with Ratko Mladic. U.S. rewarded cooperation with Hague tribunal by resuming $10 million aid 9 June. Bosnia's High Rep. Paddy Ashdown censured FM Vuk Draskovic for openly linking future of Bosnia's Republika Srpska to Kosovo independence, implying Serbia should receive Bosnian territory. Kostunica outraged Montenegrins by presenting list of potential Montenegrin voters inside Serbia for referendum on Montenegro’s independence to EU.

Serbian government argued no Kosovo standards met and continued to pressure Kosovo Serbs to boycott participation in Provisional Institutions of Self Government. No more transfers to Hague tribunal after 3 months of consistent cooperation. President Boris Tadic and PM Vojislav offered repeatedly to meet Kosovo Albanian counterparts - both refused. Belgrade and Podgorica continued with radically opposing visions of state union's future. Serbia received extension until end of year on its 3 year IMF agreement. Influential Serbian Orthodox Church sent strong isolationist signals throughout month.

Significant progress towards EU integration: EU Council of Ministers endorsed European Commission’s decision to begin negotiations on Stabilisation and Association Agreement 25 April. Two Hague indictees surrendered: former Yugoslav Army chief-of-staff Nebojsa Pavkovic; former Republika Srpska police general Ljubomir Borovcanin. Javier Solana met State-Union officials to resolve functioning of parliament by extending present mandate (had expired 3 March). Serbian government showing increasing signs of flexibility on Kosovo. President Boris Tadic twice publicly offered to meet with Kosovo President Ibrahim Rugova: rebuffed both times. Kostunica publicly stated compromise will be necessary calling autonomy, less than independence”.

State Union parliament's mandate expired 3 March. No new elections called, but parliament continued to function. Four ICTY indictees surrendered, 12 still remain. Police issued warrant for retired general Nebojsa Pavkovic. PM Kostunica said government to announce new Kosovo policy at end of month and mentioned several possible options, all of which exclude independence, but by month end promised policy failed to materialise. Anti-semitic posters and graffiti appeared throughout Serbia, as right wing website published names of prominent Serbian Jews. Serbia hoping for green light from EU on starting feasibility study for accession; landmark textile import agreement signed 31 March.

Serbian President Boris Tadic visited Kosovo, insisting Serbian sovereignty. General Vladimir Lazarevic and Bosnian Serb generals Milan Gvero and Radivoj Miletic surrendered to ICTY. Term of state union parliament to expire 3 March, with no date for elections and disagreement between Serbia and Montenegro over how to proceed. Montenegrin government proposed alliance of 2 independent states: although rejected by Belgrade, no signs state union will collapse. BIA chief Rade Bulatovic accused of handing classified documents to CIA. President Tadic returned Labour Law to parliament following irregularities in final text.