For more than 10 years since Bulgaria has joined the EU, European agricultural funds are distributed mainly to a small number of big producers through large scale corruption, while the small land owners are deprived from their property with the complicity of the authorities, writes Georgi Kerelov.
Georgi Kerelov is a lawyer. He submitted this article to BulgarianPresidency.eu with the hope that someone in Brussels and the European capitals might like to take a closer look.
While half of the agricultural land of Bulgarian was not cultivated before the entry of the country into the European Union in 2007, thanks to the EU subsidies, this has changed drastically. But in which way and at what cost?
The common agricultural policy (CAP) of the European Union represents the lion share of the EU budget. Unfortunately, in the case of Bulgaria, CAP led to a disaster for the small land owners. Their property rights are continuously denied by the big mafia-style agricultural producers and they had no access to the European money because of the prerequisite of agricultural producer registration leading to compulsory annual payment of taxes for health and pension insurance which often may be higher than the benefits of the land.
On one hand, these big producers created local monopolies for the exploitation of the agricultural area of each village. The scheme is as follows. The four or five (sometimes even less) big local producers meet every year to divide between them the agricultural area of a given village. Within the limits of its territory, everyone of them enters, sometimes with permission, but very often without permission, in the properties of the small land owners there.
When he has a permission to enter other’s land, the big producer fixes the rent of the land at a ridiculous low level, because of his territorial monopoly (in many cases 30 BGN – €15- or less for 1000 m2, having in mind that European and national subsidies go much higher – when combined, the surface subsidy and the ecological bio-diversity subsidy may go up to 50 BGN (€25) or more for 1000 m2.
When this big producer doesn’t have a contract with the small land owner, he pays the same rent when he agrees to give compensation to the owner. But in many cases, the small owners don’t demand the money as they simply ignore the producer. To complicate this picture, some years these big local producers rent some parts of their territories (officially they transfer only the land rights they have to a third person, but on the ground they transfer all the lands within the agreed territorial limits, and are paid for that). Afterward they generally refuse to reveal the name of the new producer, and the latter is hiding from the small land owners in order not to pay them and to escape administrative suits for illegal occupation of others’ lands.
Until 2015 the government paid agricultural subsidies even for illegally occupied lands. After 2015, it stopped this practice, but this made the situation of the deprived small land owners worse. In the past they were able to obtain easily proofs from the administration registers that a certain producer had occupied their land and was given subsidies for this. From 2015 on, the big producers continue to occupy illegally lands but refuse to admit it, as in that case, they expose themselves to civil suits from the land owners, and to heavy administrative sanctions for illegal occupation of other people’s land.
On the other hand, the corrupt Bulgarian administration gives the European and national subsidies to these producers and refuses to sanction them for illegal exploitation of the agricultural lands of the small owners and the agricultural roads when they are occupied illegally (without prior permission).
The corruption within Fond ZEMEDELIE (Bulgarian State agricultural fund) through which are paid the European and national subsidies is notorious – the Bulgarian press has shed some light on this. High-ranking civil servants in this fund possess for instance brand new expensive cars, as BMW for €60,000 or more, while their monthly salary may be at €1,000 or €1,500 which is not a big salary for Sofia, where they live, which is an expensive city. They intervene in two directions. Firstly, they validate the requests of the big producers even when there are document irregularities. And secondly, eventually, as only 5% of the land surfaces are generally verified annually, they decline verification of some producers’ declarations or confirm falsely their regularity.
In the same time, the Governors of the 28 regions in the country (Oblasten upravitel) refuse to apply any administrative sanctions in case of illegal occupation of other’s land or agricultural roads, according to the Statute on agricultural lands (Закон за собствеността и ползването на земеделските земи). They simply do not examine the complaints of the small land owners, as in the case of the Governor of Oblast Pazardzhik, Stefan Mirev. Further, the Prime Minister doesn’t sanction its Governors for their illegal inaction; instead, he officially supports their behaviour via the Head of the General Inspectorate at the Council of Ministers, Maria Tomova. (Further details can be found here.)
So, with the help of the European subsidies, which also finance the acquisition of big agricultural machinery such as tractors, harvest machines, etc., or expensive treatment and conservation agricultural facilities, a small minority of big agricultural producers capture millions of euros from Europe, from the Bulgarian state budget and from the illegal exploitation of the agricultural land of hundreds of thousands of small owners. For 2017 only 4% of the agricultural producers controlled 80% of the agricultural land in Bulgaria, the biggest producer Svetlozar Dichevski (Светлозар Дичевски) controlling more than 100,000 hectares, according to the website Mediapool.
As the rights of the small agricultural land owners are not respected by the Bulgarian administration (due to lack of adequate administrative protection against the big producers), most of them have already sold their property at low prices – the minuscule annual rent for the land, as explained above, predetermines the low sale price.
Otherwise, if they try to cultivate their own lands by themselves, they are first denied access to their lands as the roads are destroyed and transformed in agricultural land by the big producers. And if they can cultivate the land, then their production gets stolen, with the police very often refusing to search and persecute the thieves. And of course, as they evade registration as agricultural producers, they don’t have access to public subsidies.
DISCLAIMER: All opinions in this analysis reflect the views of the author, not necessarily of BulgarianPresidency.eu
Christian Geiselmann says
All opinions in this analysis are correct and relevant. The problem is: who is there to take action? The tiny land holders are not able to do this. The large ones are not interested. People with enough education to start tackling the problem have fled the countryside, or the entire country.
A great article describing the issue straight to the point. The practices described in this material led to the destruction of the Bulgarian village and the agricultural values of the country, which is quite sad on its own.
Another source of exploitation of the small and medium farmers are the third party buyers who buy the production and sell it to bigger players. These are usually owned (unofficially of course) by members of the parliament and are covered under political protections and benefits. For example a medium sized farmer (100-
120,000 m2) from my village decided to hold off the sale of his production and wait for a better price when the supply of the given culture is lower. He immediately was denied storage (because he could not afford to maintain storage facilities) and he was forced to sell on a price much lower than what he can get. The corruption in the agricultural sector is on a political level and the regular producers are being humiliated in the most brutal way.
The major part of the problem is corruption without a doubt, however, this could be partially resolved by creating local cooperatives and stimulating joint production.
I hope that this article will be read by people who really care about the CAP and the small and medium farmers.