BELGRADE, March 15 (Xinhua) -- Montenegro and the European Union on Thursday initialed the Stabilization and Association Agreement (SAA), a pre-membership agreement that will pave the way for the tiny Balkan country's possible entry into the pan-European bloc.

    The SAA, which was initialed by EU Enlargement Commissioner Olli Rehn and Montenegrin Prime Minister Zeljko Sturanovic in the Montenegrin capital Podgorica, is to be ratified by the two parties before implementation.

    Rehn told the Montenegrin press that the SAA is a first step towards the status of a candidate, under the condition that the agreement is correctly implemented to meet EU standards.

    Rehn said that legal and administrative reforms were imperative for Montenegro to proceed with its European integration.

    Montenegro has to adopt a new constitution to the European norms, before the SAA is formally signed and sent to parliaments of Montenegro and EU member countries for ratification. After that, talks on Montenegro's accession to the EU would follow.

    Montenegro began SAA discussions with the EU in October 2005, while it was still a part of the state union of Serbia-Montenegro, but talks were suspended last May because of Serbia's inadequate cooperation with The Hague-based International Criminal Tribunal for the former Yugoslavia (ICTY).

    Montenegro seceded from the union with Serbia in June and resumed EU talks in July as an independent country. Montenegro completed technical part of talks with the EU on Dec. 1.

    Regarding Serbia's status, Rehn repeated the EU's stance that all war crimes fugitives need to be arrested and extradited to the ICTY before talks with Serbia could resume.