The Interim Agreement (IA) with Bosnia and Herzegovina has entered into force since 1st July 2008. The IA effectively creates a free trade area, with progressive opening of the market of Bosnia and Herzegovina facilitating economic and social development. The two sides signed the Stabilisation and Association Agreement (SAA) and the IA on 16 June in Luxembourg. Until the ratification process is finalised the trade provisions of the SAA are applied through the IA.

The agreement follows the pre-agreement which indicated a period lasting a maximum of five years starting from the entry into force of this Agreement in accordance with the provisions of this Agreement and in conformity with those of the GATT 1994 and the WTO. It allows free access to EU markets for almost all goods from Bosnia and Herzegovina, which in turn will gradually open its market to the European products and services. Bosnia and Herzegovina will also introduce standards from the EU, progressively aligning its legislation in a number of areas such as competition, intellectual property, investment, public procurement or protection of personal data. This process will facilitate economic and social development in Bosnia and Herzegovina and will encourage proceeding with further economic reforms. Finally, the institutional set-up foreseen in the SAA/IA will constitute a forum of extensive dialogue and cooperation in trade related matters and beyond.

The latest Commission Communication on Western Balkans from 5 March 2008 notes that the region has a clear European perspective. In this regard, a successful implementation of the IA and SAA is a key and essential factor in assessing Bosnia and Herzegovina's readiness to further advance relations with the EU.