ECONOMY

Privatization law vetoed

SOFIA – Bulgaria’s President Georgi Parvanov late on Thursday vetoed key amendments to the privatization law that aimed to prevent the courts from blocking 15 strategic sales, an important part of Sofia’s drive for reform. The pro-Western government, which initiated the changes, has said the amendments would stop legal hurdles from getting in the way of landmark sales, like they did last year in the cases of state tobacco monopoly Bulgartabak and telecoms operator BTC. Under the amendments, which had triggered heated political debates, the Privatization Agency and the government will handle the sale of the 15 companies, allowing no room for appeals or protests in the supreme court. But Parvanov sent the changes back to Parliament for further consideration, saying the lack of a right to appeal decisions linked to the sell-offs would curb the rights of potential investors and create opportunities for corruption. «Privatization would go beyond clear market rules and turn into a political process, thus diminishing strategic investors’ interests,» Parvanov said in a statement. The government drafted the amendments after court battles dealt a major setback to its efforts to press ahead with long-delayed structural reforms in the European Union aspirant. The list of the strategic companies that the government plans to privatize by year’s end includes BTC, Bulgartabak, seven electricity distribution companies, the Vazov group of arms plants and two companies trading in arms. Bulgaria’s new flag carrier Balkan Air Tour, the state maritime fleet and the state river fleet are also on the list. The legal changes were expected to enable the government to complete the sale of Bulgartabak, which has been stuck in court since last September following appeals by three failed bidders against the sale procedure. In December, the supreme court annulled the sell-off agency’s decision to name a Deutsche Bank-backed consortium as an exclusive buyer for an 80 percent stake and recommended that higher bids be sought than the 110 million euros ($118.8 million) offered by the group. Analysts said the legal changes would had cleared the way for the Deutsche Bank group to continue its participation in the Bulgartabak sale procedure, but the presidential veto made the option look uncertain. The sale of the BTC telecoms operator is unlikely to be affected by the veto. A legal deadlock over the sale was resolved last month after the chief prosecutor’s office confirmed a company owned by London-based private equity firm Advent as a preferred buyer of a 65 percent stake for 200 million euros. The sale had been blocked in early December after the prosecutor suspended the deal while it reviewed the legality of the sale. The Privatization Agency said it respected the president’s right to veto and declined further comment. Under Bulgarian legislation, the president can veto legislation once, and the veto can be overruled by a simple majority vote in Parliament. The ruling National Movement for Simeon II (NMS) and its coalition partner, the ethnic Turks’ MRF party, hold a slim majority in Parliament with 130 seats in the 240-seat