/ world today news/ Controversial changes in the Law on State Property, which open the door wide for unprincipled decisions and corruption in state-owned enterprises and companies, were approved by the cabinet at its last meeting.
According to them, state-owned companies will be able to partner without a tender procedure with private companies of their own taste, if they need a partner for participation in public procurement, reports the “Sega” newspaper in tomorrow’s issue. Selection without a competition will be possible even for EU-funded projects, if the funding body requires the conclusion of such an agreement. The changes were adopted on the proposal of the Ministry of Transport, without debate, against the background of already announced by the Minister of Transport Ivaylo Moskovski intentions to launch large public-private partnerships in the sector.
Currently, enterprises and companies with more than 50% state participation can participate in joint ventures or develop joint activities under a contract with private companies only if these partners are selected in accordance with the Public Procurement Law (PPL). This requirement is quite recent – from January 2013, and was a source of pride in the previous cabinet of Boyko Borisov. Only a year later, however, a government led again by Boyko Borisov proposed that it be repealed with the argument that it makes it virtually impossible for companies to partner with private parties and participate in public procurement procedures. According to the official press release of the Ministry of Internal Affairs, there is no way for state-owned companies to comply with these rules, because the deadlines for starting a procedure under the Public Procurement Act do not allow it. Even with the longest time for submitting an offer – 52 days, there is no way for the interested state company to hold a competition and choose a partner with which to participate in the meantime, the MC points out.
It is not clear whether this happened in reality and whether there were any intentions of state-owned enterprises and companies that were actually thwarted by the competition requirement. It is also strange why the government proposes to cancel the competition for the selection of partners only for state-owned companies, but not for municipal companies, which should also be wronged by the short deadlines. There is also no explanation why state-owned companies should decide piecemeal for individual public procurements who they want to partner with, instead of thinking about longer-term relationships where conducting a partner selection procedure would not be a problem. It is also not clear why another relaxed competition regulation is not proposed if the PPA is inapplicable.
Bulgaria has a very bitter experience with the selection of private partners both at the national and municipal level. Among the loudest scandals for a joint partnership between state and private companies, selected without competition, was the contract for the construction of the highway “Thrakia” with a Bulgarian-Portuguese consortium. Then the European Commission sharply criticized the lack of competition in the selection of the contractor and recommended that no one follow Bulgaria’s example. Alphabetical examples of scandalous public-private partnerships are also the mixed companies of the municipal company “Sofiyski Imoti”, which led to the looting of municipal lands.
The issue is even more controversial against the background of the envisaged possibility of such joint ventures to be made upon absorption of the European funds. In the transport sector, beneficiaries of European funds are state-owned enterprises such as the national company “Strategic Infrastructure Projects”, which was created to build and maintain the “Struma”, “Hemus”, “Black Sea” highways, NKJI, “Port Infrastructure”. Ivaylo Moskovski himself allowed a public-private partnership for the completion of the “Hemus” highway and the construction of parking lots for heavy trucks on the highways, and the “Oresharski” cabinet talked about public-private financing for the container terminals in the ports of Varna and Burgas. It is expected that there will be great interest from private companies and it is inexplicable why the choice of a partner will not take place after a public tender.
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## World Today News: Interview on Controversial Changes to the Law on State Property
**Welcome to World Today News. Today, we’re discussing the recent cabinet approval of controversial changes to the Law on State Property which may open the door to unprincipled decisions and corruption in state-owned enterprises.
**To help us analyze this complex issue, we’re joined by two esteemed guests:**
* **Dr. Maria Petrova**: A legal expert specializing in public procurement and transparency.
* **Mr. George Ivanov**: An economist with extensive experience in public-private partnerships.
**Part 1: Deregulation and Potential for Corruption**
**Interviewer:** Dr. Petrova, the article highlights concerns that these changes essentially bypass competitive tender procedures. Can you explain why this deregulation is considered problematic, particularly in terms of corruption risks?
**Dr. Petrova:**
**(Answers focusing on legal vulnerabilities, lack of transparency, potential for favouritism, and increased risk of abuse and misuse of public funds.)**
**Interviewer:** Mr. Ivanov, you have deep experience navigating public-private partnerships. Do you share the concerns raised about the potential for corruption under this new framework? What safeguards, if any, do you think would be necessary to mitigate these risks?
**Mr. Ivanov:**
**(Answers providing an economist’s perspective on the potential benefits and drawbacks of public-private partnerships, addressing the concerns about transparency and accountability, and suggesting potential mechanisms to ensure fairness and prevent corruption.)**
**Part 2: Impact on Public Procurement and EU Funded Projects**
**Interviewer:** Dr. Petrova, the article mentions that these changes could affect EU-funded projects. What implications could this have for Bulgaria’s
relationship with the European Union and access to funding in the future?
**Dr. Petrova:**
**(Answers addressing the potential for EU scrutiny and sanctions, highlighting the importance of adhering to EU procurement regulations, and discussing the potential impact on Bulgaria’s reputation and trustworthiness within the EU.)**
**Interviewer:** Mr. Ivanov, how might these changes impact the attractiveness of Bulgaria as a destination for foreign investments, particularly in infrastructure projects?
**Mr. Ivanov:**
**(Answers analysing the potential impact on investor confidence, discussing the importance of a transparent and competitive business environment, and offering suggestions for mitigating negative perceptions.)**
**Part 3: Alternatives and Long-Term Solutions**
**Interviewer:** Dr. Petrova, what alternative solutions might address the government’s stated concerns about timelines while preserving transparency and fairness?
**Dr. Petrova:**
**(Answers proposing alternative procurement models, suggesting amendments to existing regulations to address time constraints, and highlighting best practices from other countries.)**
**Interviewer:** Mr. Ivanov, looking ahead, what long-term strategies could Bulgaria implement to ensure responsible and ethical development of its infrastructure while maximizing benefits for the public and minimizing corruption risks?
**Mr. Ivanov:**
**(Answers focusing on long-term institutional reforms, promoting good governance practices, strengthening oversight mechanisms, and fostering a culture of transparency and accountability.)
**Interviewer:** Thank you both for your insightful perspectives on this crucial issue. The implications of these changes are far-reaching, and we hope this discussion encourages further public debate and scrutiny of the new Law on State Property. Thank you
