The head of UNMIK, Dr. Bernard Kouchner, who introduced the Pact to the IAC, noted that the regulation on municipal self-government -- a draft of which was endorsed by the IAC on Wednesday -- is the first step towards building that interim institutional framework, which UNMIK is required to establish under Security Council Resolution 1244.

Having completed its initial emergency phase of work, UNMIK is now well into the second phase, which involves the process of developing democratic institutions for self-governance, and which began in December with the creation of the Joint Interim Administrative Structure (JIAS), Dr. Kouchner said.

He told the IAC that, as Kosovo heads towards the October polls which will result in the first democratically elected municipal assemblies, giving shape to a complete framework for other interim institutions will now begin to require much of the focus of UNMIK, political leaders and the people of Kosovo.

"I think it is very important to involve all members of Kosovo society at an early stage in our work on the Pact," he said, adding that he plans a campaign across Kosovo to discuss the Pact and other key issues on Kosovo's future.

In today's meeting, the IAC also bid farewell to Dennis McNamara, the Deputy Special Representative of the Secretary-General heading UNMIK's humanitarian assistance pillar which phases out this week, signalling the end of emergency aid to Kosovo.

Briefing the Council, Assistant Secretary-General for Peacekeeping Operations, Hedi Annabi, said UNMIK has focused on improving security in Kosovo and has taken special measures to protect minority communities.

He said the situation "shows some signs of stabilization" although the first two weeks of June saw an increase in the frequency of ethnically motivated attacks, primarily targeting Kosovo Serbs. The number of threats against non-Serb families residing in northern Mitrovica has also been on the rise and minorities in urban Pristina and north of the city have continued to report a lack of freedom of movement and access to essential services.

Mr. Annabi said that international police officers continue to be needed and encouraged members of the Security Council to provide personnel and political support for UNMIK's police component. Strong statements of support for ethnic tolerance and denunciations of violence would also help to underscore the international community's abhorrence of continued attacks on minorities and international staff.

On elections, due to be held in October, Mr. Annabi said that despite the participation of Kosovo Albanians in the registration process -- over 890,000 applications had been received as of 7 July -- the Kosovo Serb community and much of the Kosovo Turkish population are continuing to boycott the process.

Kosovo Serbs and Turks should be encouraged to participate and to understand that UNMIK is determined to continue the process of building democracy and the best possible institutions in Kosovo, Mr. Annabi said.

"I am not only shocked but deeply depressed that today criminals chose religious men as their targets, " he said. "It is totally unacceptable that this kind of revenge killing substitute itself for justice."

Dr. Kouchner said he hoped that the victims of this "contemptible act" would recover and return to their mission.

UNMIK Police "are doing everything in their power to identify the suspects and bring them to justice, " he said.

The regulation would give the 30 municipalities in the territory considerable self-governance, if it is approved by the United Nations in New York and signed by Dr. Bernard Kouchner, the head of the United Nations Interim Administration Mission in Kosovo (UNMIK).

The draft regulation, which spells out the responsibilities and powers of the municipalities, establishes provisional institutions for democratic and autonomous self-government at the municipal level as a step in the progressive transfer of administrative responsibilities from UNMIK to local bodies, UNMIK said in a press release.

One member of the IAC, Mr. Rexhep Qosja of the United Democratic Movement (LBD), objected to a provision that would place temporary "community offices" in those municipalities where a minority community formed a substantial part of the population. These offices will ensure that community rights are protected and that all communities have equal access to public services at the municipal level.

The offices were necessary in areas inhabited by Serbs because they were the most threatened and targeted populations, and that they were a temporary solution, which would be reviewed every six months, Dr. Kouchner told the media.

Another disputed issue in the regulation was the use of languages, the Deputy Special Representative of the Secretary-General in charge of Civil Administration, Mr. Tom Koenigs, told a press briefing today that meetings and official documents will be in Serb and Albanian. However, where there is a substantial part of the population which does not speak Serb or Albanian, proceedings will be translated and documents made available in their language.

All official signs, sign posts and names will be given in Serb and Albanian but where for a substantial part of the population the language is neither Serb nor Albanian, they should be given in their language too, he said.

The Ombudsperson, Mr. Marek Antoni Nowicki, will investigate and mediate complaints from individuals, groups and organizations about possible abuses of power by international and local institutions, UNMIK said in a press release issued today.

Mr. Nowicki, 47, will hold the post for two years and will be assisted by one international and two Kosovo deputies. The Ombudsperson's office, an independent vehicle for members of the community to seek redress from human rights violations and abuses of authority, is intended to remain after the departure of UNMIK.

According to UNMIK, the office will give particular priority to allegations of severe or systematic violations and those based on discrimination and can take preventive steps, make recommendations and give advise. The Ombudsperson may also promote reconciliation between ethnic groups, directly intervene with authorities to resolve complaints and recommend suspension of administrative decisions.

The office of the Ombudsperson is not a court, but has broad powers of investigation to collect evidence to support recommendations, the UNMIK statement said. There will be no appeal to the decisions by the Ombudsperson, who will also report once a year to the head of UNMIK on the human rights situation in Kosovo.

Mr. Nowicki has a long record of activism and writing on human rights issues. He co-founded the Helsinki Watch Committee in Poland during martial law and has served as president of the Executive Committee of the International Helsinki Federation of Human Rights in Vienna.

UNMIK spokeswoman Nadia Younes said the regulation was discussed by the Interim Administrative Council, the Kosovo Transitional Council, the Central Election Commission, as well as by the Organization for Security and Cooperation in Europe and the United Nations in New York.

"It has taken into account the opinion of the vast majority of political factions and opinion in Kosovo," she said at a press briefing in Pristina.

During the briefing, Ms. Younes also announced that Dr. Kouchner has appointed Mr. Anthony Preston-Stanley as the new co-head for the Department of the Central Fiscal Authority. He replaces Mr. Alan Pearson who is now acting Deputy Special Representative of the Secretary-General for Reconstruction and Economic Development.

She said the water supply in Pristina, which worsened last week mainly due to the electricity situation, was back to normal following repairs to the Batlava pumping stations, re-supply of fuel and an agreement signed between the electricity company and the water company.

The electricity situation "still remains precarious" and rotating power cuts will continue around Kosovo today, Ms. Younes said.