Serbia's law enforcement and security agencies, particularly the Customs Administration, Criminal Police, Border Police, Security Information Agency, and other security services continued to improve intra-governmental cooperation. Serbia has two police organizations that operated as counterterrorism tactical response units, the Special Antiterrorist Unit and the Counterterrorist Unit. The Criminal Investigative Unit for Counterterrorist Investigation within the Interior Ministry's Criminal Investigation Directorate conducts terrorism-related investigations.

The Parliament passed new legislation that will aid in countering terrorism. Parliament passed on March 19, and amended on September 3, the Law on the Prevention of Money Laundering and the Financing of Terrorism, which is compliant with international standards. The law applies all provisions of the previous Anti-Money Laundering Law to terrorist financing and expands the entities required to collect information and file currency transaction reports. It requires reporting of transactions suspected to be terrorist financing and creates mechanisms for freezing, seizing, and confiscating suspected terrorist assets. On December 11, the Parliament passed a law specifying that non-biometric passports would not be valid after December 31, 2010. On October 26, the Parliament passed the National Security Strategy and National Defense Strategy. The strategies define terrorism and note that separatism and religious extremism are security risks.

On July 5, the trial of Islamist extremists charged with conspiracy to commit terrorism, illegal possession of firearms, and attempted murder concluded. The Belgrade District Court's Special Department for Organized Crime convicted 12 individuals and acquitted two others. Authorities found evidence that the group was planning attacks on infrastructure in the city of Novi Pazar, on a local religious leader, and on several sites in Belgrade, including the U.S. Embassy. In a follow-up trial on September 8, an additional four individuals were convicted of planning attacks on police in Novi Pazar and storing large quantities of weapons and ammunition.

Bilateral cooperation continued to improve, and the United States provided counterterrorism training and assistance to the Serbian government. In February, the Department of Justice International Criminal Investigative Assistance Training Program (ICITAP) conducted a counterterrorism workshop for Serbian police officers. The workshop covered trends in international terrorism, the formation of a joint terrorist task force, investigative techniques, vulnerability assessments, crime scene management, case studies, and practical exercise problems. In May, ICITAP conducted an informant development course for Serbian counterterrorism and organized crime investigators. Also in May, ICITAP held an anti-corruption workshop bringing together for the first time Serbian and Montenegrin police and prosecutors to discuss terrorism and corruption. In September, ICITAP and the FBI's Hostage Rescue Team provided joint training to a SAJ-sponsored counterterrorism regional training initiative. This training involved specialized counterterrorism units from Serbia, Slovenia, Bosnia, Croatia, Romania, Greece, Bulgaria, and Montenegro.

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