Bulgaria's Land Swaps: Is EC Bringing Justice to the Bulgarian People (Finally...)?

Logically for some and paradoxically for others, most Bulgarians have viewed their country’s accession to the EU not just as a means of catching up with the West economically. They have had this hope – or rather – a misunderstanding – that the institutions in Brussels can somehow bring justice to the country over the head of the politicians in Sofia (who, of course, have been elected by the Bulgarians themselves – go figure…).

The reasons for those widespread attitudes in Bulgaria have been a general lack of knowledge about the EU and institutions, and the failure of Bulgaria’s internal mechanisms to ensure not only prosperity but, above all, justice.

As a result, there has been much disillusionment with the EU for the Bulgarian population – because these expectations failed to materialize. No wonder, since the EU was never supposed to police and prosecute corruption in Bulgaria.

This is supposed to be carried out by the respective Bulgarian institutions which in turn are supposed to be controlled by the Bulgarian civil society or whatever that thing is. At the end of the day (or of the post-communist transition period), this whole EU-bring-justice-to-the-Bulgarians-who-are-incapable-of-achieving-it-themselves thing did not pan out.

However, some of the later European Commission correspondence with the government in Sofia might signal some change in this respect.

The EU – especially with its supranational executive body, the European Commission – is an extremely weird entity in a number of ways. One of them is how the Commission can practically expand its powers into certain new fields or influence some developments outside of its competences by a wider interpretation of EU law.

Thus, Bulgaria has contributed something new to the evolution of the powers of the EC. Because now the European Commission has finally started to fight graft in Bulgaria even if in a roundabout way – by protecting fair competition in the common market (!!!).

In a nutshell, Bulgaria recently got a letter from the EC Directorate-General on Competition threatening fines over a rather interesting approach from the era of early capitalism employed over the last few years, and especially in 2008-2009, by the Bulgarian government.

The so called land swap deals are this really sweet mechanism through which private companies (owned by certain people) and the state (governed by certain people) exchange land plots of supposedly equal value.

This has been the theory. In practice, as one can easily imagine even without being a land swapping expert, the private firms got plots at primary resort locations around the country (such as near Black Sea or mountain resorts), whereas in exchange the state got rocky peaks or some other kind of wasteland.

These deals have scandalized the Bulgarian society – or at least the thinking part of it. Which – judging by the fact that there has not really been too much of protests – can’t be that large.

In any case, in addition to being totally unfair – even though they have been technically legal – thanks to the nice legislation passed by the same circles interested in executing those land swap deals – and making some people extremely rich, the land swaps have had as a by-product the destruction of some of Bulgaria’s nicest nature spots.

Some 33 000 decares of state lands were swapped over the recent years in a total of 47 deals. To be fair, it should be noted that the Borisov government already collected evidence and the prosecutors pressed charges over the ex Agriculture Minister Valeri Tsvetanov and ex Forestry Agency head Stefan Yurukov over the land swaps as early as September 2009, i.e. a month after the GERB Cabinet took office.

However, little progress has been made on the cases, and there had been little talk of rescinding the deals from which Bulgaria lost between BGN 2 B and BGN 8 B, according to current Agriculture Minister Miroslav Naydenov.

Not until the European Commission stepped in. It has objected to 15 of the 47 land swap deals asking the Bulgarian government to prove their legality, its rationale being that they presented state aid to private companies incompatible with EU law. This means that Bulgaria might get fined hundreds of millions of euros as a result of what is practically a crime committed by former top ranking officials.

Because the first really important thing to note about the land swap deals is that they are a lot more than just a breach of EU’s competition regulations or state aid to private companies. They are outright thefts whose side effect is severe environmental destruction.

Of course, the eurocrats in their offices in the weird-shaped EU buildings in Brussels are sufficiently aware of that fact. But they have to go through using EU competition protection regulations in order to strike at corrupt practices in Bulgaria.

And it is good they have done so. Because the second very important thing to point out is that for the first time the Borisov government seems ready to explore the opportunities of making the scandalous deals null and void. This legal possibility was announced Wednesday by the Chief Prosecutor Boris Velchev. It is to explore a loophole in one of the privatization laws but it is yet to be researched.

With little left from the 20-day deadline give to Bulgaria by the EC to explain the situation with the land swaps, the Bulgarian government has decided to “plead guilty” - to admit that the deals were in fact state aid, and to try to ask for remission of the sanctions, or, if the EC does not agree, to force those who benefited from the deals to pay the fines themselves.

Clearly (even though still not clear for most Bulgarians), the nice EU people in Brussels are not allowed to interfere directly in Bulgaria’s internal affairs in the sense of catching the bad guys and jailing them. Yet, their push and pressure on the authorities in Sofia seem to be producing the conditions for a more decent solution of the land swap issue.

So it seems fair to say that there has been an interesting bit of EU/EC evolution here as the eurocracy has in some way expanded its powers – it has practically tackled political corruption in Bulgaria despite doing that by using the rules for fair competition in the common market. That is why in cases such as Bulgaria’s expanding the supranational element of EU’s powers seems more appealing than scary (or appealing to most and scary to some).

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