By Robin Emmott and Luiza Ilie
BRUSSELS/BUCHAREST (Reuters) - The European Union and the United States told Romania on Wednesday to end political pressure on judges amid increased concerns about the rule of law in one of the EU's most corrupt member states.
Romania's parliament approved a bill in December to protect lawmakers from corruption investigations linked to public office and although the country's top court overturned the legislation, it will still return to parliament for further debate.
The rushed amendment to Romania's criminal code has raised questions about its commitment to reform seven years after it joined the EU. Bucharest's justice system remains under special EU monitoring, which is normally reserved for non-EU countries wanting to join the club.
The European Commission, the EU executive that carries out the monitoring, said in its latest report it would not tolerate political pressure on the justice system or loopholes for lawmakers and said it needed to see action.
"Romania should pass the legislative measures to restructure the court system... and ensure that corruption laws apply to all on an equal basis," said Mark Gray, a senior EU official, following the presentation of the report.
Shortly before the release of the report, the United States' top diplomat in Romania, Duane Butcher, said that doubts about the country's justice system could harm its economy.
"Investors will hesitate to come to Romania and those already on the ground will not expand their investments if the playing field is not level, or the rule of law is not consistently enforced," Butcher told reporters in Bucharest.
Romania's economy is expected to grow by 2.2 percent this year and officials say it could now exceed that level, but the International Monetary Fund - which currently has a mission in the country to review a $4 billion funding deal - has also urged Bucharest to do more to improve its investment climate.
Judicial data shows that 28 Romanian lawmakers are on trial on corruption charges or serving jail terms, while hundreds of mayors, deputy mayors and councilors have falsified statements, faced conflicts of interest or had unexplained wealth.
Romania ranks behind only Greece and Bulgaria in terms of corruption in the 28-nation EU, according to Transparency International, and is in 69th place out of 176 nations globally.
Reacting to the EU report, Transparency International said progress in fighting corruption in Romania was "slow and insufficient" and urged the Commission to maintain its pressure.
The EU concerns suggest Romania, a country of 20 million people, will likely remain - along with southern neighbor Bulgaria - under special EU judicial monitoring and also outside the bloc's Schengen free movement zone for some time to come.
Many in the EU, which prides itself on human rights and the rule of law, believe Romania and Bulgaria were allowed to join the bloc too soon in 2007.
Brussels has been at pains to reassure countries such as Britain and Germany that they will not face a mass influx of Romanians and Bulgarians following the lifting of restrictions this month on their right to live and work anywhere in the EU.
Romania and Bulgaria remain the EU's poorest countries, with per capita wealth of less than half the EU average, and are struggling to use money from Brussels to upgrade outdated infrastructure and catch up.
(Additional reporting by John O'Donnell; Editing by Gareth Jones)