Mediapool Weekly: April 28 - May 4, 2018

Boyko Borissov: The Problem of Media Freedom is Media Owners' Problem

Volen Siderov, Boyko Borisov, Tsvetan Tsvetanov

Boyko Borissov gave an extensive interview to Nova TV Thursday to talk about the first year of his third term as PM. He managed to distance himself from all uncomfortable questions: the growing corruption, the increasingly degrading media environment, and his relationship with media mogul and DPS MP Delyan Peevski.

Regarding the freedom of the press he said that the problem with the media's freedom is the media owners' problem. “We don't intervene”, he said. The last report by Reporters Without Boarders put Bulgaria in 111 place in the World Press Freedom Index, making the country not only last in the EU in the ranking but also behind all Western Balkan countries.

To the follow-up whether freedom of the press is not to some degree a problem of the country as a whole, and of the government Borissov replied “It's your problem, the journalists'. Deal with it. What are we supposed to do? Stop Prokopiev [publisher of Capital Weekly, Capital Daily and Dnevnik Daily] and Peevski [DPS PM and publisher of numerous papers part of the Bulgarian Media Group] from fighting? I don't know and that is why we don't do anything.”, he concluded.

Regarding some recent feuds with President Roumen Radev, who has recently been speaking out about the increasing levels of high corruption in the country and absence of transparency, he said that “if [Radev] has information or signals, he may go to the Prosecutor Office and they will be sued. If he has information – Peevski, he may go to the court and say that thanks to this or that deal Peevski was awarded this or that procurement”. Borissov thereby answered a question that Radev posed in absentia whether Borissov has common businesses interests with Peevski.

Borissov said that for the first year of his third term he is most proud of reducing the foreign debt “by 2 billion 300 million”. He is most ashamed of the withdrawal from the Istanbul Convention. He said that he had not expected for the Convention to become hijacked by different political interest rendering it impossible to pass.

Another mistake he pointed out was the bad reaction by his party, GERB, to the scandal about selling CEZ. He assured that all developments relating to the deal with CEZ are being watched very closely by the government but in silence because according to him any comment could be met with millions of claims by the lawyers of the large companies.

Regarding Dessislava Ivancheva's very public arrest he said he hoped that the newly formed Anticorruption Commission will know better next time not to make such flashy demonstrations. He said he is personally against such exposure but ultimately supports the operation. He reasoned that it had been necessary for Ivancheva to stand for five hours handcuffed on the street because the law enforcement officials had to make an inventory of both sides of all the banknotes.

As for granting rights to KPKONPI to make arrests, Borissov said he is against it.

Another topic that has received attention lately is coalition partner Volen Siderov's comments in Russia, where he stated that Crimea was never annexed nor occupied by Russia. Borissov said “anyone has the right to attract voters”. Besides that his comments were directed at President Radev by reminding that Radev had expressed a similar position regarding Crimea during his presidential campaign.”

He closed the topic by declaring that “While GERB is in power NATO and the EU will remain not only unconditional values but we - most members”.

After once more moving the conversation towards president Radev Borissov was asked if there is a conflict between the government and the president, to which he replied “The attacks are coming from him and are aimed at us. Till now this has had only negative affects.” In order to achieve understanding Borisov has “ordered all ministers to ask for daily meetings with the president”.

Bulgaria is Against Linking European Funds with the Rule of Law

It is not normal for the rule of law to be used as criteria when planning the European cohesion and agricultural funds after 2020 because this could be use for political interference and unequal treatment of the member states, and equal standing between member states is a basic principal in the European treaties.

Finance Minister Vladislav Goranov expressed this opinion while answering a question about what he thinks about the proposal of the EC to limit or cease EU funding to member states that fail to uphold the rule of law.

Still, Bulgaria will not speak out its position on the matter at European events before the end of the Bulgarian presidency of the Council of the EU.

Generally donor countries support the measure while countries like Poland and Hungary are against.

Bulgaria will commence negotiations May 14, as part of its presidency. Donchev expects for them to be tough. The Bulgarian government hopes for the negotiations to reach a conclusion before the elections for European parliament 2019.

Deputy Prime Minister Tomislav Donchev assured that no significant change in funding is expected after 2020, within the 2021-2027 financial framework. In fact, he pointed out, the net amount of the funds Bulgaria is to receive is increased by 2 billion euro, from 371 billion to 373 billion for the next program period.

Donchev also stressed how new funds will be allocated to Bulgaria for security of the outer border of the EU due to increased migration.

Political Consensus Against Independent European Inquiry in the Supreme Administrative Court (VAS)

The majority of Parliament is against the European Structural Reform Support Service (SRSP) to conduct an analysis of VAS's practice. This was made clear during a regular hearing of the Minister of Justice Tsetska Tsacheva at a session of the Justice Parliamentary Committee.

Early this year the government submitted a request to Brussels for an independent audit of the administrative justice system, including VAS, criminal justice system and the court Inspectorate to the Supreme Judicial Council (VSS). The Commission has decided to grant the request partly and conduct the audit on all systems with the exception of the criminal justice system.

An audit would most likely put the work of the head of VAS for the last 7 years, who is close to the largest ruling party GERB, Georgi Kolev at its center. It seems that that has had an impact on the decision to halt the procedure. Problems during his watch remain unresolved. One prominent issue was that it was established that the system for randomization of cases among judges is compromised and in effect systematically bypassed. Another was some extremely fast court rulings on certain cases and other extremely slow ones. Thirdly, VAS is full of staff, who have some form of family relation to one another.

During the session of the Committee the question of the audit was brought up by Pencho Milkov [Bulgarian Socialist Party (BSP) MP]. Tsetska Tsacheva explained that the government stands by its initial request for a full audit (including criminal justice). She added that an official answer by the EC as to reason for the change has not been received either.

“The unofficial reason is that it is too expensive to assess and analyze the whole criminal justice system”, she explained.

The decision of the EC to investigate only the administrative branch of the justice system has been met with great resistance by VAS. On April 26 the plenary of VAS requested that the government withdraw its request for the audit altogether. One of the arguments was that a structural reform is not necessary in the system anyway. Ironically enough, VAS had initiated precisely such a reform earlier this year, namely for the establishment of an entirely new structure, the Central Administrative Court.

The threat of actually having the EC run an in-depth analysis of the work of the court has prompted for a rare bipartisan consensus between GERB and BSP.

“We believe that this approach [assessing only VAS] is unequal. The Bulgarian Parliament must guarantee that the different sectors within the system have equal stance. Most of the recommendations of the EC reports have to do with the criminal justice system, hence, this analysis is of higher strategic importance to us compared to the one of the administrative branch”, the Chair of the Justice Parliamentary Committee Danail Kirilov said. He continued to announce that GERB will look for support to BSP for withdrawing the request to the Commission for the audits.

“If Brussels thinks this is an expensive procedure, why do it now? Auditing the administrative justice system is likely to be just as expensive”, he concluded.

Businesses Impatient for Energy Reform to Come into Force

Employers' organizations demonstrated impatience for the start of the implementation of energy sector reforms, mapped out in the amendments to the Energy Law that Parliament passed last week. The organizations sent an official letter to president Roumen Radev to speed up the promulgation process. They also wrote an open letter asking Bulgarian MP's in the European Parliament to push for the European Commission to rule on the official complaint that the organizations have submitted January 2017 against the so-called American Plants AES Galabovo and ConturGlobal Maritza Iztok 3, claiming the plants receive state subsidies unlawfully.

The business sector expects that the amendments to come into force July 1 2018 will correct the asymmetrical liberalization of the market that exists now and that all energy producers – TPP's, renewables and congregations with installed capacity over 4MW – will be able to sell energy on the free market.

Employers point out that the imperfections of the market, whose liberalization began in 2004, have been mainly due to the fact that the only producers that sold energy on the free market were TPP Kozloduy, TPP Matitza Iztok 2 and sometimes the National Electric Company (NEK) while consumer companies are over 50'000. Besides, the other of the energy producers receive different subsidies, financed through a special corporate tax on energy consumption.

The Association of Bulgarian Employers (AORB) has calculated that the cost of these subsidies amount to 1.5 billion lev, a number that will only increase in time if things stay the same.

Boyko Borissov's Favorite Gas Hub Dropped from the Bulgarian Presidency Agenda

Regarded as one of the milestones of the Bulgarian Presidency, the project for the gas hub near Varna won't be part of its agenda. Initially two large meetings dedicated to the hub were planned. They were not carried-out.

The hub is a favorite project of Boyko Borissov's. He frequently talks about its importance and strategic value, as it is supposed to supply theWestern Balkans and Western Europe with gas.

The reason for the hub to drop from the agenda is that the feasibility studies have not been done yet. They are to assess routes, capacity, cost analysis, financing opportunities etc.

The results of the study had to be presented on May 2 during the second investment meeting, which is a follow-up of the first, which took place in September 2016. The meeting in May was to be preceded by a work meeting in March, which didn't take place because the procurement for the feasibility study was being appealed by one of the applicants.

There is still a possibility for the project to be discussed during the Annual Summit of the Central and South Eastern Europe Gas Connectivity, which will take place in Sofia on June 29.

The ambition of the government was for the gas hub project to be an opportunity to demonstrate to the European partners advancement in the sphere and also for the project to be at the center of discussions at the Western Balkan Summit in Sofia on May 17.

Regardless, Bulgaria will present preliminary results of the feasibility study to stakeholders early June in Brussels, as the European Commission secured half of the funds needed for conducting the study.

The State Gambling Committee (DKH) Declares Aggressive TV Gambling Ads Normal

DKH has found nothing irregular in the massive amounts of TV ads for lottery games on two of the largest Bulgarian TV networks, Nova and bTV.

The unprecedented inspection was ordered by the new Chair of DKH Maria Filipova about a month after she assumed the post.

While Bulgaria is a country whose laws prohibit direct advertisement of gambling games, this inspection has concluded there is no legal obstacle for the so-called “games of happiness” to be aired frequently in primetime slots.

Recently the Media Club Agency did a study based on data by Nilsen that revealed that the National Lottery, which is owned by two of prominent businessman Vassil Bozhkov's companies, is the top advertiser in Bulgaria for 2017. The companies have invested a total of 23 million euro in TV and print media ads.

It is not surprising, given the marketing efforts behind the games that 57% of Bulgarians play the lottery or other form of gambling game, as a recent poll by Gallup International showed. Bulgarians who gamble spend an average of 15% of their daily budget on gambling, which amounts to a total of about half a billion lev annual income for the gambling industry.

Meanwhile two political parties – one a member of the ruling coalition – United Patriots (OP) and one non-parliamentary, Democratic Bulgaria (DB) are both pushing for restrictions on gambling advertisement.

OP leader and Vice PM Valery Simeonov told Mediapool on Monday, April 30 that he had submitted the bill to his parliamentary group for discussion and hopes for it to be ready for submission in parliament “by the end of the week”.

“The goal [in drafting the bill] is to cease what has been pouring over our heads for so long: that you can succeed in life by scratching tickets.”

While OP's bill deal primarily with advertisement, DB's also proposes to restrict the places where one could by lottery tickets. While currently they can be found virtually anywhere, DB's proposal is for tickets to be sold only in shops, especially dedicated to gambling.

Experts: The Anti Corruption Commission should not be Allowed to make Arrests

Ivanka Ivanova, Director of the Open Society Institute – Sofia's (OSI) Law Program thinks that the Commission for Countering Corruption and Illegal Assets (KPKONPI) should not be given the right to arrest suspects. The opinion is shared by the former Director of the Center for Prevention and Countering Corruption and Organized Crime (BORKOR) Rumen Milanov.

The newly formed Anticorruption Commission is about to become a second Ministry of Interior if the bill is passed through Parliament. Mediapool talked to sources and it seems that the ruling coalition is inclined to vote in favor of the bill. However, “Boyko Borissov has the last word on the matter”, as one source put it.

Coalition partners from the United Patriots (OP) also refused to go on the recored but it was indicated that they wouldn't oppose the bill. The Movement for Rights and Freedom (DPS) also have not come to a final decision but don't see a problem: “if the commission has to arrest – so be it”, one source said.

OSI's Ivanka Ivanova explained in an interview for the Bulgarian National Radio (BNR) that the ability to make an arrest is not a stand alone police function. Instead it is part of the process of crime investigation. This means that in order to have the right to arrest suspects, the Anticorruption Commission will also have to be given authority to investigate crimes.

“Bulgaria has enough bodies that can make arrests. Not only don't I see a clear connection between expanding the number of bodies that arrest suspects and lowering corruption; this would lead to serious problems regarding the protection of basic citizen rights”.

Roumen Milanov said that it is dangerous to allow different institutions to make arrests as in order to be allowed to do that, a special legitimacy of the body or institution is needed. There are certain procedures to be strictly followed in the case of an arrest.

The idea behind bodies such as the Anticorruption Commission is for them to have an active coordination role among the different security structures that are part of anticorruption efforts, and to establish a horizontal network between them.

Asked about the arrest of the then-mayor of Mladost Dessislava Ivancheva two weeks ago, which was carried-out by the Ministry of Interior, Prosecution Office and KPKONPI, Milanov said that the operation was a clear example of a failed start of an institution on the part of KPKONPI, stressing once more that KPKONPI is at its core a coordinating body with the purpose of developing preventive measures.

Sergey Stanishev: The Reasonable Timeframe for Adopting the Euro is 2025

Leader of the Party of European Socialists (PES) and ex Bulgarian Prime Minister Sergey Stanishev told Darik Radio on Saturday that the reasonable timeframe for adopting the euro is 2025.

“Studies of the cases of Slovenia and Slovakia and other countries, which adopted the euro recently, unequivocally show that there is no real impact on inflation, nothing over half a percent. On the other hand there are real advantages to the euro. At the moment Bulgarian companies that import and export generate a total annual cost of 1 billion lev just for exchanging euro to lev and vice versa. Once in the eurozone this billion will remain in the Bulgarian companies.”, Stanishev said.

Later this week the Institute for Market Economics (IPI) produced a report on the affects of entering the eurozone. According to the study, the positives for the economy will be felt as early as the country enters the so-called eurozone 'waiting room' [ERM II]. The two main impacts of starting the official process of adopting the euro are better credit rating (most countries have experienced increased credit rating immediately after entering ERMII) and – more importantly – the process will be a push for adopting important reforms that otherwise tend to get neglected. Entering the ERMII means an obligation to undertake structural changes to guarantee a “high degree of sustainable economic convergence”, as stated in Article 140 of the Treaty on the Functioning of the EU. The expected positive outcomes, the study suggests, could be compared only to the accession process between 1997-2007, which marked the decade of greatest growth after 1989.

The Acting Mayor of Mladost has Said he will Resign

Vladimir Klisurov (right)

In a lengthy Facebook post acting mayor of Mladost Vladimir Klisurov said he will be resigning the post. He took the mayorship after the dramatically executed arrest of Dessislava Ivancheva on April 17.

Prior to being selected for acting mayor Klisurov had said that he did not want to take the post. On Tuesday he announced he will resign. He explained his motives as not wanting to sign permits that will allow for more construction on the territory of the municipality, especially as being part of the initiative committee “Green Mladost”, which is fighting the expansion of construction development.

It is not yet clear, however, when the actual resignation will be submitted officially.

Both times Klisurov has tried to not be acting mayor (resisting to take the post and now declaring his plans to resign), he points to deputy mayor Rumen Russev as a good candidate for the post. Dessislava Ivancheva meanwhile has accused Russev of being part of a conspiracy against her that led to her arrest.