In the absence of results in the fight against corruption at the highest levels of power, Bulgarian Prime Minister Boyko Borissov needs other arguments in his efforts to convince the Netherlands and Germany that the country should be admitted to Schengen. Such an argument was the smuggling of cigarettes, writes Krassen Nikolov.
Krassen Nikolov is a journalist specialised in judiciary affairs. He works for Mediapool and will be a regular contributor for BulgarianPresidency.eu for the six months of the Bulgarian Presidency of the Council of the EU.
On 5 February 5, Borisov announced Bulgaria as an example in the fight against cigarette smuggling across the EU. He quoted data of large cigarette companies that the illegal cigarette market in the country has fallen to a record low of 6 percent. The research is done each year by counting the empty packs of cigarettes in the garbage cans. It is not representative because it does not take into account the illegal market for cut tobacco.
“How can Bulgaria be at 6%, and whoever asks if there is a fight against corruption – there, here it is,” Borissov said.
He compared Bulgarian data with those in the UK where smuggled cigarettes were 35% of the market, in France – 23.7%. Borissov even said he would raise the issue of smuggling in the EU at the upcoming European Council.
“One by one, I will ask my colleagues. 23.7% smuggling in France, and for Greece, and Poland, and Estonia, and Lithuania, and Latvia – huge percentages. When we talk about 10 billion euros missing in the new [EU] budget [after Brexit] if we count these percentages how much money they represent, surely, over 100-200 billion euros of uncollected revenue will go to our common European budget”, he said.
The percentage of the illegal market in Bulgaria indicated by Borissov in no way reflects the transit of illegal cigarettes across the Bulgarian borders. They do not reflect either the production of illegal cigarettes in Bulgarian factories, which are for export.
Despite the “lack of smuggling of cigarettes”, Borissov said that in the big cities of the country a billboard campaign is launched calling on people not to buy smuggled cigarettes. At the same time, the customs and police began a campaign to strengthen control over cigarette factories and warehouses in the country.
The data of the international institutions also do not support the thesis of the Bulgarian prime minister.
In 2017, a KPMG report on the illegal cigarette market across the EU has indeed recognised a significant reduction in the black cigarette market in Bulgaria in recent years. However, the country remains in the EU top 10 of the largest volumes of illegal cigarettes sold. France ranks first with 8.96 billion illegal cigarettes on its domestic market for the whole of 2016. Poland is second with 6.16 billion, and third is UK with 5.55 billion. Bulgaria ranks tenth with 980 million, which is 9.5 times less than France, but Bulgaria has 10 times less population.
At the end of last year a report by the Turkish authorities was unveiled, which reported a significant presence of Bulgarian illegal cigarettes on the country’s domestic market. Their producer was the Bulgarian company Bulgartabac, which later sold its brands to BAT (British-American Tobacco). The report came to Europol and the Bulgarian Prosecutor’s Office, but it is still not known if efforts were made to break the scheme. Europol’s comment on smuggling cigarettes from Bulgaria is that this service has an excellent interaction with the Bulgarian authorities. The subject of the report has long been overlooked by the Bulgarian authorities. Moreover, Chief Prosecutor Sotir Tsatsarov and Interior Minister Valentin Radev have been put in a situation to explain that they have not read it. However, some two months ago, an investigation began. It was announced that data from all Bulgarian offices and customs would be required to provide information on cigarette smuggling, as well as on manufactured and exported quantities. Since then, the prosecution has not reported anything on the subject.
Asked to comment cigarette smuggling through and inside Bulgaria, the European Anti-Fraud Office (OLAF) also takes note of the good cooperation with the Bulgarian authorities. At the same time, OLAF points out that “because of its geographical location, Bulgaria plays a key role in the smuggling routes of cigarettes to the EU”. The information provided by OLAF is that 24 million smuggled cigarettes have been seized in Bulgaria in 2016. This places the country on 15th place in the EU.
The data from OLAF and KPMG contradict the Bulgarian Prime Minister’s thesis that Bulgaria has completely succeeded to fight the smuggling of cigarettes, and that it has no problem with corruption as well.
The arrests of customs officials on suspicion of corruption in the country continue. Last October, 20 customs officers were detained at the border with Turkey. One more was detained in December. The problem is that the accusations against many of them do not stand in court and they even succeed to get back to work. In January it was revealed that Bulgarian customs have been working for five years with a software that allows data manipulation.
Borissov’s statement on cigarette smuggling and corruption was made on 5 February as a general rehearsal before his meeting with Dutch Prime Minister Mark Rutte. On 6 February, Rutte announced in Sofia that the Netherlands had not withdrawn its objections to the accession of Bulgaria to Schengen.
Data from OLAF and KPMG contradict the Bulgarian Prime Minister’s thesis that Bulgaria has completely overcome the smuggling of cigarettes, it has no problem with corruption as well.
The arrests of customs officials on suspicion of corruption in the country continue. Last October, 20 customs officers were detained at the border with Turkey. One more was detained in December. The problem is that the accusations against many of them do not stand in court and they do not even get back to work. The January issue also revealed that Bulgarian customs have been working for five years with an information system that allows data manipulation.
Borissov’s speech on cigarette smuggling and corruption was made on 5 February as a general rehearsal before his meeting with Dutch Prime Minister Mark Rutte. On February 6, Ruete announced in Sofia that the Netherlands had not withdrawn its objections to the accession of Bulgaria to Schengen.
Mark Rutte pours cold water on Bulgaria’s Schengen and Eurozone dreams
“We are in favor of Bulgaria’s accession to Schengen, but the work has not yet been completed – it requires the efforts of many actors in the process, including Bulgaria, but I would like to congratulate Borissov on what has been achieved in this respect. As Juncker also said, Bulgaria some more to do, and I believe it will do it”, the Dutch prime minister said.
All this means that Prime Minister Borissov will have to find another argument to convince the partners that the country is fighting corruption.
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