Bulgaria Minister: No Idea Who's Behind DTT Mux Deals

Business | January 26, 2013, Saturday // 18:29|  views

Bulgaria's Transport Minister Ivaylo Moskovski. Photo by Sofia Photo Agency

Bulgaria's transport minister has played down concerns over lack of clarity about the winners of the controversial tenders for the operation of what will be the country's DTT multiplexes.

"I know the names of the companies, which won the multiplexes tenders - Hannu Pro and Slovakia's Towercom. But I don't know who the owners are. I only know that one company is English and have no idea about the other," Transport Minister Ivaylo Moskovski told the national state-owned TV channel on Saturday.

The minister reiterated that the problems most probably dated back to the term of the previous Socialist-led government, which approved the legislation and organized the competitions for selecting the operators.

He however turned a blind eye to the fact that the current government of GERB was expected to break the alleged cartel in Bulgaria's digital switchover, but refused to do so.

In his words the lack of clarity over the ownership of the offshore companies, which were assigned the digital broadcast spectrum, does not pose any threats to the national security.

On Thursday the European Commission referred Bulgaria to the EU court, saying that the procedure followed by the country was based on disproportionately restrictive award conditions, leading to the exclusion of potential candidates.

This hampers competition in the future Bulgarian digital terrestrial television (DTT) infrastructure market, in breach of the applicable EU Directives on electronic communication, the European Commission said in an official statement.

Bulgaria has awarded the licenses for its multiplexes to only two companies - Latvia's Hannu Pro (four) and Slovakia's Towercom (two).

Brussels launched the infringement procedure in May 2011 following conflicting requirements for the eligible bidders in the mux contests, which drove away Austria's Oesterreichischer Rundfunksender GmbH & Co KG (ORS).

The requirements in fact made possible a near monopoly on the mux market as all companies which were granted licences are linked in one way or another to Tsvetan Vassilev, majority owner of Bulgaria's Corporate Commercial Bank.

At first it was not clear who stands behind the foreign investors Towercom and Hannu Pro, but soon the names of Tsvetan Vassilev, head of Bulgaria's Corporate Commercial Bank and Irena Krasteva, a media mogul, believed to be funded by the bank and ethnic Turkish leader Ahmed Dogan, popped up in all deals.

In a bid to prevent legal action by the European Commission, Bulgaria decided at the end of December 2011 to hold a tender for yet another multiplex, its seventh.

The government has boasted that the new amendments will allow companies such as Austria's ORS, which have TV channels outside Bulgaria, to participate in the new DTT contest.

The Commission welcomed Bulgaria's recent announcement of the launch of a tender procedure for the assignment of this spectrum.

The Commission however said it expects Bulgaria to publish the conditions of the tender as soon as possible, so that potential new entrants can prepare their applications, be selected and enter the market before the date set for the analogue switch off, September 1, 2013.

The Commission said it will monitor that the tender conditions are in line with the Directives and allow effective entry into the digital terrestrial broadcasting infrastructure market.

Local experts however say that the new procedure is a mere attempt to throw dust in the eyes of Brussels officials.

The seventh multiplex will be just a collection of frequencies and its holder - in a much more disadvantaged position than Hannu Pro and Towercom, which have already grabbed the lion's share of the market, according to them.

Bulgaria's communications watchdog is obliged to prepare the package of documents for the new tender on September 1, 2013 under legal amendments that parliament hurriedly adopted in the last days of 2011.

This is also the deadline for the analogue switch-off in the country even though a new delay is very likely.

Until then the government is expected to splurge BGN 300 M on freeing frequencies currently held by the military.

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Tags: Transport Ministry, Bulgaria, Slovakia, Latvia, Austria, European Union Court of Justice, NURTS, Alexander Tsvetkov, Transport Minister, analogue switch-off, Technicolor, Thomson Broadcast, BNR, BNT, Irena Krasteva, BTC, Bulgarian Telecommunications Company, Vivacom, Mancelord Limited, Gintars Kavacis, Towercom, Hannu Pro, Communications Regulation Commission (CRC), Bromak, Communications Regulation Commission, European Commission, Corporate Commercial Bank, Oesterreichischer Rundfunksender, Competition Protection Commission, DTT, multiplexes, Brussels, Oesterreichischer Rundfunksender, ORS, Tsvetan Vassilev


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