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EU Cohesion policy: €133.4 million for Bulgaria and Sweden to tackle the social and economic impact of the coronavirus crisis

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The Commission has approved the modification of three operational programmes (OPs) under REACT-EU to provide €75.9 million to Bulgaria and €57.5m to Sweden to help tackle the effects of the pandemic. Commissioner for Jobs and Social Rights, Nicolas Schmit, said: “The coronavirus has put our social fabric to the test and has hit the most vulnerable people the hardest. The EU is showing solidarity by supporting the provision of aid in these difficult times and promoting social inclusion.” Cohesion and Reforms Commissioner Elisa Ferreira (pictured) said: “The decisions approved today are the result of good policy measures. They will provide much needed investment resources for the post-coronavirus crisis move to a green and digital recovery.” The Bulgarian programme for the Fund for European Aid to the Most Deprived (FEAD) will receive an extra €19.9m in 2021 to provide daily warm meals to 50,000 people from vulnerable groups living in poverty. This is the first amendment of a FEAD OP under REACT-EU. In addition, the Bulgarian programme ‘Science and Education for Smart Growth', co-financed by the European Social Fund (ESF) and the European Regional Development Fund (ERDF), will be topped up with €56m to support distance learning. At least 10% of students and teachers will receive laptops or tablets and 30% of teachers will receive training in online teaching. In Sweden, the Commission has approved the modification of an OP that will increase the funding available for investments by nearly €57.5m. The amendment of the national OP co-financed by the ERDF will support the sustainable green and digital transition of the Swedish SMEs that were most negatively impacted by the crisis, such as from the tourism and hospitality sectors. REACT-EU is part of NextGenerationEU and provides €50.5 billion additional funding over the course of 2021 and 2022 to programmes under the ERDF, the ESF and the FEAD.

Bulgaria

The caretaker government in Bulgaria attacks public service television in an attempt to silence the opposition

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The public service television in Bulgaria – BNT (Bulgarian National Television) is experiencing an unprecedented institutional attack. The government, represented by the Minister of Culture Velislav Minekov, has openly insisted on the resignation of BNT Director General Emil Koshlukov on account of disapproval of the editorial policy of the media and threat to the national security of the country. The leaders of political party „Democratic Bulgaria“, as well as of „There is Such a People“, which is close to the President of Bulgaria Rumen Radev, have also criticized the media chief.

In his response to the Bulgarian Minister of Culture, Emil Koshlukov reminded him that according to the Radio and Television Act, the Minister has no right to interfere in the editorial policy of the television. He added that such repression happens only in North Korea and for the first time in the history of BNT, the executive allows itself so impudently and unceremoniously to daunt journalists.

However, for the fourth day in a row, Minister Minekov has not stopped attacking. He is the son of Velichko Minekov, who is the sculptor closest to the communist dictator Todor Zhivkov and who played a strong role in the Communist Party’s nomenclature before the fall of the Iron Curtain. Velislav Minekov continues the family tradition of using art as a bridge to power. His works are part of the collection of the oligarch Vassil Bojkov, who was sanctioned by the United States under the Global Magnitsky Act. Bojkov publicly acknowledged that he had paid for and managed the protests in Bulgaria last summer, and Minekov was their organisational leader. This leads to reasoned assumptions that Minekov helped Bojkov to overthrow the government of Boyko Borissov, in return of making him a minister in the caretaker government of President Radev.

Meanwhile, BNT continues to be attacked by other organizations, which stood behind the protests in the summer of 2020. Another organization that asked for Emil Koshlukov’s resignation is the BOEC civil movement. They were made public due their close contacts with another oligarch who fled abroad from Bulgarian justice – Tsvetan Vassilev. What all attacks have in common is not only the time, but also the goal, namely to silence the voice of the opposition from GERB.

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Treasury sanctions influential Bulgarian individuals and their expansive networks for engaging in corruption

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The US Department of the Treasury’s Office of Foreign Assets Control (OFAC) sanctioned three Bulgarian individuals under the "Magnitsky Act" for their extensive roles in corruption in Bulgaria, as well as their networks encompassing 64 entities.  The Administration believes corruption degrades the rule of law, weakens economies and economic growth, undermines democratic institutions, perpetuates conflict, and deprives innocent civilians of fundamental human rights, and today’s action — the single largest action targeting corruption to date — demonstrates the Department of the Treasury’s ongoing effort to hold accountable those involved in corruption. 

The US government will continue to impose tangible and significant consequences on those who engage in corruption and work to protect the global financial system from abuse.

“The United States stands with all Bulgarians who strive to root out corruption by promoting accountability for corrupt officials who undermine the economic functions and democratic institutions of Bulgaria,” said Office of Foreign Assets Control Director Andrea M. Gacki.  “Not only does corruption deprive citizens of resources, it can erode the institutions intended to protect them.  This designation under the Global Magnitsky sanctions programme shows that we are committed to combatting corruption wherever it may be.”

This action targets Vassil Kroumov Bojkov, a prominent Bulgarian businessman and oligarch; Delyan Slavchev Peevski, a former Member of Parliament; Ilko Dimitrov Zhelyazkov, the former Deputy Chief of the Bulgarian State Agency for Technical Operations who was appointed to the National Bureau for Control on Special Intelligence-Gathering Devices; and the companies owned or controlled by the respective individuals.  These individuals and entities are designated pursuant to Executive Order (E.O.) 13818, which builds upon and implements the Global Magnitsky Human Rights Accountability Act and targets perpetrators of serious human rights abuse and corruption around the world.  These sanctions coincide with complementary actions taken by the US Department of State to publicly designate Peevski and Zhelyazkov, among others, under Section 7031(c) of the Department of State, Foreign Operations, and Related Programs Appropriations Act due to their involvement in significant corruption.

The designations constitute the largest Global Magnitsky action taken on a single day in the history of the programme, targeting over 65 individuals and entities for their significant acts of corruption in Bulgaria. 

The corrupt activities undertaken by the individuals designated today demonstrate how pervasive corruption goes hand-in-hand with other illicit activity.  The breadth of today’s action shows that the United States will support the rule of law and impose costs on public officials and those connected to them who use government institutions for personal profit.  Today’s designation exposes Bojkov, Peevski, and Zhelyazkov for abusing public institutions for profit and cuts off these individuals’ and their companies’ access to the US financial system.  To further protect the international financial system from abuse by corrupt actors, Treasury encourages all governments to implement appropriate and effective anti-money laundering measures to address corruption vulnerabilities.

These actions send a strong signal that the United States stands with all Bulgarians who strive to root out corruption.  We are committed to helping our partners realize their full economic and democratic potential by tackling systemic corruption and holding corrupt officials accountable.  Treasury remains committed to working with Bulgaria to address money laundering reforms that lead to financial transparency and accountability.  We call upon regulators to communicate the risks of doing business with these corrupt officials and their companies.  

Vassil Kroumov Bojkov (Bojkov), a Bulgarian businessman and oligarch, has bribed government officials on several occasions.  These officials include a current political leader and the former Chairman of the now-abolished State Commission on Gambling (SCG).  Bojkov also planned to provide a sum of money to a former Bulgarian official and a Bulgarian politician earlier this year to help Bojkov create a channel for Russian political leaders to influence Bulgarian government officials.

Bojkov is currently in Dubai, United Arab Emirates, where he successfully evaded Bulgarian extradition on a number of charges levied in 2020, including leading an organized crime group, coercion, attempted bribery of an official, and tax evasion.  In its investigation, the Prosecutor’s Office of the Republic of Bulgaria found that in February 2018, Bojkov paid the then-Chair of the SCG 10,000 Bulgarian Lev (approximately $6,220) on a daily basis to revoke Bojkov’s competitors’ gambling licenses.  Following this massive bribery scheme, the Chair of the SCG resigned, was arrested, and the SCG was abolished.  There remains an international warrant for Bojkov’s arrest as his influence continues in Bulgaria.  In advance of the July 2021 Bulgarian parliamentary elections, Bojkov registered a political party that will run candidates in the aforementioned elections to target Bulgarian politicians and officials.

Bojkov is designated pursuant to E.O. 13818 for being a person who has materially assisted, sponsored, or provided financial, material, or technological support for, or goods or services to or in support of corruption, including the misappropriation of state assets, the expropriation of private assets for personal gain, corruption related to government contracts or the extraction of natural resources, or bribery. 

OFAC is also designating 58 entities, including Bulgarian Summer, registered in Bulgaria that are owned or controlled by Bojkov or one of his companies:

  • Vabo-2005 EOOD, Digital Services EAD, Ede 2 EOOD, Nove Internal EOOD, Moststroy Iztok AD, Galenit Invest AD, Vabo 2008 EOOD, Vertex Properties EOOD, VB Management EOOD, Va Bo Company EOOD, Vabo Management EOOD, Vabo 2012 EOOD, Prim BG EAD, Eurogroup Engineering EAD, Kristiano GR 53 JSC AD, Nove-AD-Holding AD, Bul Partners Travel OOD, Bullet Trade OOD, Caritex Lucky AD, Sizif V OOD, Thrace Foundation, Vabo Internal AD, and Bulgarian Summer are owned or controlled by Bojkov.
  • Rex Loto AD is owned or controlled by Vabo-2005 EOOD.
  • Eurobet Partners OOD is owned or controlled by Digital Services EAD.
  • Eurobet OOD is owned or controlled by Eurobet Partners OOD.
  • Eurobet Trading EOOD is owned or controlled by Eurobet OOD.
  • Vabo Systems EOOD, Vato 2002 EOOD, Nove Development EOOD, Property-VB OOD, Trans Nove OOD, Nove Partners OOD, Adler BG AD, Efbet Partners OOD, and Internews 98 OOD are owned or controlled by Nove Internal EOOD.
  • Eurosadruzhie OOD and Decart OOD are owned or controlled by Vabo Systems EOOD.
  • Numerical Games OOD, Lottery Distributions OOD, National Lottery OOD, and Eurofootball OOD are owned or controlled by Eurosadruzhie OOD.
  • National Lottery AD is owned or controlled by Nove Development EOOD.
  • Meliora Academica EOOD, Domino Games OOD, and ML Build EAD are owned or controlled by Decart OOD.
  • Games Unlimited OOD is owned or controlled by VB Management EOOD.
  • Evrobet - Rumania EOOD and Old Games EOOD are owned or controlled by Games Unlimited OOD.
  • Vihrogonika AD is owned or controlled by Vabo Management EOOD.
  • Vabo 2017 OOD and Lottery BG OOD are owned or controlled by Vabo 2012 EOOD.
  • Siguro EOOD is owned or controlled by Eurogroup Engineering EAD.
  • Trakia-Papir 96 OOD, Parkstroy-Sofia OOD, Publishing House Sport LTD, and CSKA Basketball Club are owned or controlled by Nove-AD-Holding AD.
  • Ancient Heritage AD is owned or controlled by Thrace Foundation.

Delyan Slavchev Peevski (Peevski) is an oligarch who previously served as a Bulgarian MP and media mogul and has regularly engaged in corruption, using influence peddling and bribes to protect himself from public scrutiny and exert control over key institutions and sectors in Bulgarian society.  In September 2019, Peevski actively worked to negatively influence the Bulgarian political process in the October 27, 2019 municipal elections.  Peevski negotiated with politicians to provide them with political support and positive media coverage in return for receiving protection from criminal investigations.

Peevski also engaged in corruption through his front man Ilko Dimitrov Zhelyazkov (Zhelyazkov), the former Deputy Chief of the Bulgarian State Agency for Technical Operations and former Bulgarian State Agency for National Security (DANS) officer who was appointed to the National Bureau for Control on Special Intelligence-Gathering Devices.  Peevski used Zhelyazkov to conduct a bribery scheme involving Bulgarian residency documents for foreign persons, as well as to bribe government officials through various means in exchange for their information and loyalty.  For example, as of 2019, Zhelyazkov was known for offering bribes to senior Bulgarian government officials who were expected to provide information to Zhelyazkov for onward passage to Peevski.  In return, Zhelyazkov would see that individuals who accepted his offer were placed in positions of authority and also provided a monthly bribe.  Peevski and Zhelyazkov also had an official placed in a leadership position to embezzle funds to them in 2019.  In another example, as of early 2018, these two government officials ran a scheme to sell Bulgarian residency documents where company representatives purportedly paid bribes to Bulgarian officials to ensure their clients received citizenship documents immediately rather than making the $500,000 deposit or waiting the five years for a legitimate request to be processed.  Lastly, Zhelyazkov also blackmailed a potential Bulgarian government minister with criminal charges from Bulgaria’s Prosecutor General’s office if the minister did not provide him further assistance upon appointment.

Peevski and Zhelyazkov are designated pursuant to E.O. 13818 for being foreign persons who are current or former government officials, or persons acting for or on behalf of such an official, who are responsible for or complicit in, or who have directly or indirectly engaged in, corruption, including the misappropriation of state assets, the expropriation of private assets for personal gain, corruption related to government contracts or the extraction of natural resources, or bribery. 

OFAC is also designating six entities registered in Bulgaria that are owned or controlled by Peevski or one of his companies:

  • Int Ltd EOOD and Intrust PLC EAD are owned or controlled by Peevski.
  • BM Systems EAD, Int Invest EOOD, Inttrafik EOOD, and Real Estates Int Ltd EOOD are owned or controlled by Intrust PLC EAD.

As a result, all property and interests in property of the persons above that are in the United States or in the possession or control of US persons are blocked and must be reported to OFAC.  In addition, any entities that are owned, directly or indirectly, 50% or more by one or more blocked persons are also blocked.  Unless authorized by a general or specific license issued by OFAC, or otherwise exempt, OFAC’s regulations generally prohibit all transactions by US persons or within (or transiting) the United States that involve any property or interests in property of designated or otherwise blocked persons.  The prohibitions include the making of any contribution or provision of funds, goods, or services by, to, or for the benefit of any blocked person or the receipt of any contribution or provision of funds, goods, or services from any such person.

Building upon the Global Magnitsky Human Rights Accountability Act, E.O. 13818 was issued on December 20, 2017, in recognition that the prevalence of human rights abuse and corruption that have their source, in whole or in substantial part, outside the United States, had reached such scope and gravity as to threaten the stability of international political and economic systems.  Human rights abuse and corruption undermine the values that form an essential foundation of stable, secure, and functioning societies; have devastating impacts on individuals; weaken democratic institutions; degrade the rule of law; perpetuate violent conflicts; facilitate the activities of dangerous persons; and undermine economic markets.  The United States seeks to impose tangible and significant consequences on those who commit serious human rights abuse or engage in corruption, as well as to protect the financial system of the United States from abuse by these same persons.

Click here to view more information on the designation.

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Kovatchev says steps taken by Bulgaria’s caretaker government are questionable

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Andrey Kovatchev MEP, Chair of the Bulgarian delegation in the European People's Party spoke to EU Reporter about a letter the delegation has sent to all MEPs. The letter claims that the caretaker government, which is responsible for organising elections for 11 July is acting in a way that puts their neutrality into question. 

GERB - the EPP’s affiliated party in Bulgaria, led by Boyko Borissov has been damaged by recent allegations that opposition politicians had their phones wiretapped. Kovatchev says that if there is evidence behind these allegations, then people should be punished, however he adds that if there isn’t evidence the allegations amount to disinformation ahead of the election.

The main subject of the letter concerns the Minister of Internal Affairs Bojko Rashkov and remarks he made in a recent interview referring to politicians as ‘former people’ - a phrase that dates back to Bulgaria’s Communist past, when people who were opponents of the government were described in this way. 

In a very serious allegation the MEPs also state that the minister’s chief of staff is in some way linked to gambling oligarch Vasil Bozhkov, known as ‘the Skull’ – a gambling oligarch, who’s currently in hiding in Dubai, after 19 charges were filed against him in Bulgaria. Bozhkov intends to participate in forthcoming elections. 

The European Parliament has raised the issue of the rule of law in Bulgaria in 2019. EU Reporter interviewed members of the ‘Brussels for Bulgaria’ demonstrators in October 2019 who were calling for new elections and reforms to end corruption. 

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