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Bulgaria upsets EU over leaked corruption report

EU

A confidential report by OLAF, the EU anti-fraud watchdog, pointing at misuse of up to €6.1 million of EU pre-accession funding by Bulgaria has been leaked to the media, provoking dismay in Brussels, where the European Commission is preparing a key review of how new member states are combating organized crime and corruption.

The OLAF report deals with corruption schemes with EU pre-accession funds for agriculture and rural development in Bulgaria under the so-called SAPARD program to the amount of €6.1 million. The leak in the Bulgarian media comes at a bad moment for the European Commission, which is due to release a crucial update on 23 July about the progress made by the new EU member in the fields of judicial reform and combating corruption.

The report was allegedly leaked following a 15 July meeting of the Bulgarian Deputy Prime Minister in charge with EU funds, Meglena Plugchieva, and members of the Supreme Judicial Council – the highest administrative body of the Bulgarian judiciary.  Plugchieva said she was “unpleasantly surprised” that the magistrates, from whom she expected action to address corruption, had instead undermined the investigation by leaking the report to the media.

 
LEAK ‘UNDERMINES EFFORT TO FIGHT CORRUPTION’

Speaking to EurActiv, a spokesperson for OLAF said his organization was “very unhappy”, that the report has been made public. He explained that it was a normal procedure for OLAF to send copies of its reforms to national authorities, whether in France, Italy or Bolivia. But these reports are secret, not public, he stressed.

A Commission spokesperson told EurActiv that the EU executive regretted that “once again routine correspondence has been leaked,” saying breaches of confidentiality undermined efforts to fight corruption and organized crime. The spokesperson made it plain that leaks of confidential information are a serious problem in the communication between Brussels and Sofia. The report focuses on fraud schemes carried out by businessmen through which OLAF calls “the Nikolov-Stoykov Group”. Mario Nikolov and Lyudmil Stoykov were arrested a year and a half ago on suspicion of misuse of SAPARD funds, but were soon released.

Bulgarian Prime Minister Sergei Stanishev downplayed the leaked OLAF report, saying that in every EU country, there are problems with agricultural funds. “We are in a process of self-training how to work with maximum efficiency and transparency with the EU funds”, he said, according to Bulgarian daily Dnevnik.

 
BULGARIA AT RISK OF LOSING EU FUNDING

But such explanations may not suffice to the Commission. Indeed, the press agency Reuters announced, quoting EU sources, that following the publication of its progress report on Bulgaria next Wednesday, the European Commission is likely to strip the country of about €500 million of EU funds. The Commission is also expected to warn Sofia that it may lose future aid unless it fights corruption harder, the same sources said.

BBC Romania wrote that, according to diplomatic sources, the Commission report on Romania will be less critical than the one on Bulgaria. According to a source in the EU executive, there will in fact be three reports presented: one on Romania, one on Bulgaria and a third one on Bulgaria and the European funds. According to the BBC, the funding cuts in Bulgaria’s case will be carried out by retrieving the accreditation of paying agencies.

 

 
Background:

When Romania and Bulgaria joined the EU on 1 January 2007, shortcomings remained regarding judicial reform and the fight against corruption - and in the case of Bulgaria, the fight against organized crime. These shortcomings carried the risk that Bulgaria and Romania would not be able to correctly apply Community law and that Bulgarians would not be able to fully enjoy their rights as EU citizens. In order to assist both countries, a Cooperation and Verification Mechanism was set up.

The latest annual reports on Bulgaria and Romania will be made public on 23 July. The reports are prepared by the Secretariat General under the authority of the Commission President in agreement with Vice-President Barrot. (EurActiv)

 

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