Freedom in the World
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In 2004, the government of San Marino agreed to a controversial European Union directive that imposes a withholding tax on non-resident savings accounts. The directive is intended to reduce harmful tax practices by tax havens.
Founded in A.D. 301, San Marino is the world's oldest and second smallest republic (after Vatican City). Although the Sammarinesi are ethnically and culturally Italian, they have succeeded in maintaining their independence against great odds since the fourth century. The papacy recognized San Marino's independence in 1631, as did the Congress of Vienna after the Napoleonic Wars in 1815. In 1862, Italy and San Marino signed a treaty of friendship and cooperation, beginning a long period of closeness between the two countries. Despite its dependence on Italy, from which it currently receives budget subsidies, San Marino maintains its own political institutions. It became a member of the Council of Europe in 1988 and a member of the United Nations in 1992. Tourism and banking dominate the country's economy.
Early elections were called in June 2001, leading to the return of a coalition of the Christian Democrats (PDCS) and the Socialist Party (PSS). The PDCS won 25 seats, the PSS 15, the Democratic Party (PPDS) 12, the Popular Party (APDS) 5, the Communist Party (RC) 2, and the National Alliance (AN) 1. A government crisis late in 2003 was resolved in December of that year with the replacement of the minister of foreign affairs.
In September 2004, Giuseppe Arzilli and Roberto Raschi were elected as captains-regent - joint heads of state. The term of office for captains-regent is six months.
A decision by the EU Council of Ministers finalized the controversial directive that intends to reduce the harmful tax practices of European tax havens in the EU and outside of it. By agreeing to the directive, the country will impose a withholding tax on non-resident savings accounts. Part of the revenue of the tax will go back to the investor's state of residence.
The Sammarinesi can change their government democratically. The 60 members of the Great and General Council (a unicameral legislature) are elected every five years by proportional representation. The executive power of the country rests with the 10-member Congress of State (cabinet), which is headed by the two captains-regent elected every spring and fall. The Great and General Council selects two of its members to serve as the captains regent (joint heads of state) for a six-month period. Although there is no official prime minister, the secretary of state for foreign affairs has assumed some of the position's prerogatives.
Freely elected representatives determine the policies of the government in San Marino, where there are few problems with corruption. San Marino was not ranked in Transparency International's 2004 Corruption Perceptions Index.
Freedom of speech and the press are guaranteed in San Marino. There are daily newspapers, a state-run broadcast system for radio and television called RTV, and a private FM station, Radio Titiano. The Sammarinesi have access to all Italian print media and certain Italian broadcast stations, and enjoy few infringements on press freedoms. Access to the Internet is unrestricted.
The country prohibits religious discrimination by law. Roman Catholicism is the dominant, but not state, religion. People can request a donation of 0.3 percent of their income through their taxes to be allocated to the Catholic Church, or other churches like the Waldesian Church or the Jehovah's Witnesses. Academic freedom is respected in the country.
People are free to assemble, demonstrate, and conduct open public discussions. Workers are free to organize into trade unions and bargain collectively with employers. They are also free to strike, if they do not work in military occupations. Approximately half of the country's workforce is unionized.
The judiciary in the country is independent. Lower court judges are required to be noncitizens - generally Italians - to assure impartiality. The final court of review is San Marino's Council of Twelve, a group of judges chosen for six-year terms from among the members of the Grand and General Council. The country's prison system generally met international standards and civilian authorities maintained effective control over the police and security forces.
The population is generally treated equally under the law, although the European Commission against Racism and Intolerance (ECRI) has raised some concerns in the past about the status of foreigners in the country. Most of the foreign-born population is made up of Italians; only about 2 percent - mostly women from Central and Eastern Europe who work as private nurses for the elderly and ill - come from outside the European Union. San Marino has no formal asylum policy, and a foreigner has to live in the country for 30 years to be eligible for citizenship. The European Convention on Nationality recommends that the period of residence before a foreigner can apply for citizenship should not exceed 10 years. In 2001, San Marino ratified the international convention on the Elimination of All Forms of Racial Discrimination (ICERD).
Women are given legal protections from violence and spousal abuse, and gender equality exists in the workplace and elsewhere. There are, however, slight differences in the way men and women can transmit citizenship to their children.