De Jure Compliance, De Facto Resistance: The Persistence of Elite Power and Institutional Reform in EU Candidate States

Abstract

The European Union’s enlargement process rests on a rational conditionality model: candidate countries reform because the benefits of EU membership – market access, structural funds, security guarantees, etc. – outweigh domestic adoption costs. Yet, meaningful institutional reform consistently fails to materialise in Western Balkan and Eastern European candidate states. This policy brief, drawing on an original research paper submitted at Johns Hopkins University SAIS, argues that this failure is not due to insufficient external incentives, but to the rational behavior of domestic elites who use de jure compliance to satisfy EU benchmarks while preserving de facto control over key institutions. Applying Acemoglu and Robinson’s persistence-of-power framework to Serbia, Montenegro, and Ukraine, the paper shows that elite capture of democratic institutions is a structural feature of EU candidate-country politics, not a country-specific anomaly. It recommends that the EU shift from state-centred to society-centred conditionality, prioritise measurable de facto outcomes over formal legislative benchmarks, build coalitions with civil society actors, and restore its own credibility by making rewards consistently conditional on genuine reform.

Keywords: EU enlargement, conditionality, rule of law, elite capture, institutional reform

Introduction

The European Union currently counts nine candidate countries – including Ukraine, Moldova, and five states in the Western Balkans – as it navigates a renewed push for enlargement following Russia’s full-scale invasion of Ukraine in 2022. After a period of so-called “enlargement fatigue” following the major accession rounds of 2004, 2007, and 2013, geopolitical pressures have returned institutional reform to the top of the EU’s political agenda (O’Brennan, 2014; Spyrakou, 2026). At the centre of this revived process is a longstanding and unresolved problem: candidate countries formally adopt EU rules on judicial independence, anti-corruption, and media freedom, yet these reforms rarely produce the institutional transformation the EU expects.

This phenomenon contradicts the dominant framework in the literature, the rational conditionality model, which holds that a state will reform when the benefits of EU rewards exceed domestic adoption costs (Schimmelfennig & Sedelmeier, 2004). A parallel explanation, the social learning model, proposes that countries reform when they perceive ideological alignment with EU norms as legitimate (Checkel, 2001). Both models share a common blind spot: they treat states as unitary actors and neglect the internal distribution of power. Once domestic elites are introduced as strategic actors with their own rational interests, the puzzle dissolves: elites formally comply with EU conditions because compliance delivers external rewards, but they resist substantively because genuine reform would threaten the institutional foundations of their own power. Understanding this shift – from “Why do not states want to reform?” to “Why do elites have a rational interest in sabotaging reform?” – is essential for designing an enlargement policy that produces genuine results.

Policy Problem

The core policy problem this paper identifies is what can be described as dual-track compliance: domestic elites in EU candidate countries simultaneously maximise external rewards by meeting observable EU benchmarks while minimising domestic costs by selectively undermining the enforcement of those same reforms. This dynamic has two mutually reinforcing dimensions.

The first dimension is the de jure/de facto gap. The EU conditions accession progress on formal institutional outputs: passing legislation, establishing agencies, and amending constitutions. Elites can satisfy these benchmarks through cosmetic reform without relinquishing control over the informal mechanisms of power. An anti-corruption agency can be established on paper while its budget, staffing, and case selection remain under political influence. A judicial council can be reformed on the books while its members are drawn from patronage networks. As Bold, Molina, and Safir (2018) demonstrate, this is not simply a matter of elite orders being carried out: public servants are often embedded in the same clientelist networks as the elite, sharing in the rents that unreformed institutions provide. Therefore, genuine reform means breaking an implicit contract between elites and the public officials who benefit from the status quo, making those tasked with implementing reform the very ones with the greatest interest in resisting it.

The second dimension is the temporal mismatch. The EU evaluates institutional architecture on an annual reporting cycle, whereas elites adapt their capture strategies in real time. Every time the EU identifies a new benchmark – anti-corruption frameworks, media regulations, judicial appointments – the ruling elites have time to develop strategies for satisfying it formally while neutralising it substantively. By the time the EU identifies a compliance gap, the relevant institutions have already been staffed and positioned in ways that render them toothless. The EU is always measuring last year’s institutions, while elites are managing this year’s power dynamics.

This structural problem is reinforced by the EU’s own inconsistent signalling. By praising de jure progress while simultaneously acknowledging de facto stagnation, the EU reduces the domestic political cost of superficial compliance. The problem extends inside the EU itself: democratic backsliding in Hungary and Poland demonstrates that elite-capture mechanisms operate in member states too, further undermining the normative authority of the accession framework (Guriev & Papaioannou, 2020).

Policy Research

The analysis draws on Acemoglu and Robinson’s persistence-of-power framework (2008), which explains why extractive or elite-serving institutions persist even when more efficient alternatives exist. The core mechanism is a self-reinforcing feedback loop: elites control institutions; institutions distribute rents to elites; rents translate into political power; political power allows further institutional capture. Applied to EU candidacy, this framework predicts that rational elites will invest in satisfying formal benchmarks while neutralising the substantive impact of those same reforms, a process that Noutcheva (2009) terms “fake compliance.” The framework also draws on Rodrik’s second-best institutions argument (2008), which holds that effective institutional design must be adapted to the specific political and economic constraints of each country rather than applied through a universal template.

This theoretical argument is tested through three comparative case studies chosen for maximum variation in political context.

Serbia illustrates consolidated elite capture beneath a surface of legislative progress. Despite formal judicial and anti-corruption reforms aligned with EU accession Chapters 23 and 24, including specialised anti-corruption agencies and constitutional amendments to judicial appointments, there is no track record of high-level corruption prosecutions, pro-government media dominance persists through politically allocated public advertising, and elections remain formally competitive but substantively influenced (Grieveson, 2025; Kakarnias, 2025). The EU itself has acknowledged this implementation gap, with the European Parliament noting a “lack of progress on fundamental criteria” even as it recognises Serbia’s formal legislative advances (European Parliament, 2025).

Montenegro, as the EU’s frontrunner candidate with all accession chapters open and a genuinely competitive political landscape following its 2020 electoral earthquake, represents the hardest possible test for the persistence-of-power framework. If elite capture persists even under conditions of genuine political competition, EU frontrunner status, and decades of conditionality exposure, the framework describes a structural feature of candidate-country politics rather than a symptom of particularly weak governance. And persist it does: despite legislative progress and real political turnover, decade-old patronage networks have proven resilient, with Freedom House and Transparency International documenting a persistent enforcement gap in anti-corruption and judicial outcomes (Freedom House, 2024; Transparency International, 2025).

Ukraine, despite extraordinary geopolitical incentives for reform and a sophisticated formal anti-corruption architecture, continues to face endemic corruption challenges. Oligarchic elites adapt to new institutional environments rather than being displaced by them, reshaping the implementation of reforms to preserve their underlying influence, while wartime centralisation of power unintentionally reinforces elite control and limits accountability (IMF, 2026; OECD, 2017). Across all three cases, the persistence-of-power mechanism reasserts itself as a structural feature of candidate-country politics.

Policy Recommendations

The following recommendations address the structural misalignment between the EU’s current state-centred conditionality approach and the domestic political economy of candidate states. They aim not to increase external pressure in general, but to alter the incentive structure that currently makes superficial compliance a rational strategy for domestic elites.

1. Shift from state-centred to society-centred conditionality

The EU should establish direct funding channels to civil society organisations, investigative media platforms, and watchdog NGOs, bypassing central governments where necessary to reduce the risk of political interference. This reduces the elites’ ability to monopolise both the implementation and monitoring of reform, increasing the domestic costs of maintaining purely cosmetic compliance (Bruszt et al., 2010).

2. Prioritise de facto metrics over de jure benchmarks

The EU should complement its legislative assessment with measurable outcome indicators that elites cannot easily simulate without relinquishing control. Priority metrics should include:

• The number and conviction rate of high-level corruption prosecutions involving politically connected individuals.
• The share of public procurement contracts awarded through genuinely competitive procedures.
• Media ownership concentration and government advertising allocation as indicators of editorial independence.
• Judicial appointment outcomes assessed against merit-based selection criteria.

3. Apply differentiated, context-sensitive conditionality

Following Rodrik’s second-best institutions argument (2008), the EU should move away from a one-size-fits-all institutional template and adapt its approach to the specific political economy of each candidate country. This includes directing EU pre-accession funding not only to central governments, but also directly to judicial courts and anti-corruption bodies, reducing the risk of elite capture at the institutional level and building institutional capacity independently of political interference.

4. Build internal coalitions with pro-reform actors

The EU should systematically identify and support actors within candidate countries who have an internal incentive to reform: independent judges, civil society groups, anti-corruption prosecutors, reform-oriented technocrats, and business communities that benefit from genuine rule of law. External incentives are most effective when they reinforce, rather than substitute for, domestic demand for change. Coalition-building with these actors creates political constituencies for reform that can exert pressure on elites from within, rather than relying solely on external conditionality.

5. Restore conditionality credibility through consistent enforcement

The EU must end the practice of praising de jure progress while acknowledging de facto stagnation in the same reports. A clear policy of “no genuine reform, no reward,” applied consistently across all candidate countries and based primarily on de facto outcome metrics, is essential to restore the credibility of conditionality. Consistent enforcement is critical because selective or ambiguous signalling allows elites to continue benefiting from partial compliance without incurring meaningful costs. This credibility problem is particularly acute, given that democratic backsliding within the EU has already demonstrated to candidate-country elites that the consequences of non-compliance are limited.

Note on AI use: AI was used to support the process of condensing the original paper into a policy brief with minimal loss of content and spelling/grammar check.

References

Note: This policy brief abstract is based on a full research paper submitted at Johns Hopkins University SAIS (May 2026). Selected references are listed below:

Acemoglu, D., & Robinson, J. A. (2008). Persistence of power, elites, and institutions. The American Economic Review, 98(1), 267–293.

Bold, T., Molina, E., & Safir, A. (2018). Clientelism in the Public Sector: Why Public Service Reforms Fail and What to Do about It (Policy Research Working Paper No. 8439). World Bank. https://doi.org/10.1596/1813-9450-8439 

Bruszt, L., Campos, N. , Fidrmuc, J., & Roland, G. (2010). DP7825 Civil Society, Institutional Change and the Politics of Reform: The Great Transition (Discussion Paper No. 7825). CEPR Press. https://cepr.org/publications/dp7825 

Checkel, J. T. (2001). Why comply? Social learning and European identity change. International Organization, 55(3), 553–588.

European Parliament Press Service. (2025, April 9). Rule of law and media freedom key to Serbia’s EU accession process, says MEPs [Press release].  https://www.europarl.europa.eu/pdfs/news/expert/2025/4/press_release/20250407IPR27699/20250407IPR27699_en.pdf 

Freedom House. (2024). Montenegro. https://freedomhouse.org/country/montenegro/freedom-world/2024 

Grieveson, R. (2025, December 23). Serbia’s future depends on rebuilding rule of law and EU credibility. Atlantic Council.  https://www.atlanticcouncil.org/in-depth-research-reports/report/serbias-future-depends-on-rebuilding-rule-of-law-and-eu-credibility/ 

Guriev, S., & Papaioannou, E. (2020). DP14433 The Political Economy of Populism (Discussion Paper No. 14433). CEPR Press. https://cepr.org/publications/dp14433 

International Monetary Fund. (2026). Ukraine. https://www.imf.org/en/countries/ukr 

Kakarnias, T. (2025). Decoding Serbia’s democratic backsliding: EU conditionality meets domestic realities. European Political Science, 24(3), 293–312. https://doi.org/10.1057/s41304-025-00518-8 

Noutcheva, G. (2009). Fake, partial and imposed compliance: The limits of the EU’s normative power in the Western Balkans. Journal of European Public Policy, 16(7), 1065–1084. https://doi.org/10.1080/13501760903226872 

O’Brennan, J. (2014). ‘On the Slow Train to Nowhere?’ The European Union, ‘Enlargement Fatigue’ and the Western Balkans. European Foreign Affairs Review, 19(2), 221–241. https://doi.org/10.54648/eerr2014011 

OECD. (2017). Anti-corruption reforms in Ukraine.  https://www.oecd.org/content/dam/oecd/en/publications/reports/2020/01/anti-corruption-reforms-in-ukraine_379128eb/dd48148b-en.pdf 

Rodrik, D. (2008). Second-Best Institutions. (Working Paper No. 14050). National Bureau of Economic Research. https://doi.org/10.3386/w14050 

Schimmelfennig, F., & Sedelmeier, U. (2004). Governance by conditionality: EU rule transfer to the candidate countries of Central and Eastern Europe. Journal of European Public Policy, 11(4), 661–679. https://doi.org/10.1080/1350176042000248089 

Spyrakou, V. (2026, March 4). The politics of belonging – why enlargement is now a strategic priority. LSE European Politics. https://blogs.lse.ac.uk/europpblog/2026/03/04/eu-enlargement-strategic-priority-democratic-reform/ 

Transparency International. (2025). Our work in Montenegro. https://www.transparency.org/en/countries/montenegro