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Bulgaria - EU-Bulgaria Relations

Main steps towards the EU

Bulgaria submitted its application for EU membership in December 1995. In 1997 the Commission published its Opinion (Avis) on Bulgaria’s Application for Membership of the European Union. The Commission presented its first regular report on Bulgaria's progress towards accession in November 1998. The second report, released in 1999, recommended to open formal negotiations.

Following the Helsinki European Council’s decision in December 1999, accession negotiations were opened in February 2000 and Bulgaria provisionally closed all remaining chapters on 15 June 2004 on the occasion of a meeting of the Accession Conference at Ministerial level in Luxembourg. The Brussels European Council of 17 December 2004 confirmed the conclusion of accession negotiations with Bulgaria and accordingly looked forward to welcoming it as a member from January 2007. The report on the result of the accession negotiations with Bulgaria and Romania pdf - 81 KB [81 KB] provides a detailed overview of the outcome of the negotiations.

The Commission continues to closely follow on how Bulgaria carries out its promised reforms, notably putting into practice an enhanced monitoring system to oversee Bulgaria’s final preparations for membership (see the Monitoring report of 26 September 2006 pdf - 190 KB [190 KB] , see also next chapter).

The European Parliament gave its support to Bulgaria's EU membership on 13 April 2005. The vote was 534 in favour and 88 against, with 69 abstentions.

The Accession Treaty was signed in Luxembourg on 25 April 2005. Depending on further progress in complying with the membership criteria, the objective is EU membership from 1 January 2007 (Presidency Conclusions of the Brussels European Council in December 2004 [206 Kb]).

To date, all EU Member States except Denmark, France and Germany ratified the Accession Treaty. Bulgaria itself ratified the Treaty on 11 May 2005.

Following the signature of the Accession Treaty, as enshrined in the Treaty, Bulgaria has received, in terms of arrangements for the interim period (between signature of the Treaty and accession), the status of active observer, including participation in European Council working groups and European Commission Committees and may express views, which, however, are not binding for the relevant groups/committees.

Bulgaria sent 18 MPs as observers to the European Parliament, which took office in Strasbourg on 26 September 2005.

Although EU accession is foreseen for January 2007, Bulgaria subscribed in the framework of the Accession Treaty to a specific safeguard clause, which allows the Union to postpone, upon a Commission’s recommendation at any time before the entry into force of the Accession Treaty, Bulgaria’s accession by one year to January 2008 if there is clear evidence that there is a serious risk that Bulgaria is manifestly unprepared in an important number of areas. This clause would be subject to vote by unanimity of the Member States. In its Monitoring Report of 26 September 2006, the Commission recommended not to take use of this safeguard clause and therefore confirmed the 1 January 2007 as Bulgaria's accession date to the European Union. Bulgaria's current Minister of European Affairs, Meglena Kuneva, is Commissioner designate for Consumer Protection.

Monitoring Report of 26 September 2006 (Conclusion)

Following the Monitoring Report of 26 September 2006, Bulgaria has made considerable efforts to complete its preparations for EU membership since the Commission issued its last report in May. Bulgaria is sufficiently prepared to meet the political, economic and acquis criteria by 1 January 2007.

Many of the challenges set out in the May report have now been addressed. A number of sectoral issues have been resolved. There has been some progress in the areas of judicial reform and the fight against corruption, money-laundering and organised crime, but further tangible results are needed.

The report identifies those issues which require further work. It draws attention to provisions in the acquis and the Accession Treaty which are designed to safeguard the proper functioning of EU policies and institutions following accession. In line with the findings of the report, the Commission, after consulting the Member States, will set up a
mechanism for cooperation and verification of progress in the areas of judicial reform and the fight against corruption, money-laundering and organised crime. For this purpose, benchmarks have been established which refer to the particular circumstances of Bulgaria.

The Commission has adopted the necessary legal provisions to ensure the proper management of EU agricultural funds. The report underlines that the existing rules contain the necessary guarantees for the proper management of EU structural funds, and other programmes.

In the area of food safety, some specific measures are in place. At present, certain animals and animal products may not be exported from Bulgaria to the EU because of the presence of animal diseases. These restrictions will be maintained after accession, if necessary.

In the area of aviation safety, appropriate measures for Bulgarian aircraft and carriers will be taken upon accession if necessary.

Overall, Bulgaria has made far-reaching efforts to adapt its legislation and administration to the laws and rules of the European Union. This has largely brought it into line with prevailing standards and practices within the European Union. Sustained support from the European Union will be available for addressing the remaining issues. Sufficient guarantees exist in the acquis and the Accession Treaty to ensure the proper functioning of EU policies and institutions. As a result of the progress made, Bulgaria will be in a position to take on the rights and obligations of EU membership on 1 January 2007. The Commission looks forward to welcoming Bulgaria as fully-fledged member of the European Union on this date.

EU assistance

The EU raised the amount of financial assistance to Bulgaria by an average of 30% in the period 2004-2006. Bulgaria receives around € 500 million per year reaching 2% of its GDP. The EC’s pre-accession aid to Bulgaria is mainly provided by three instruments: the PHARE programme, ISPA and SAPARD.

The PHARE programme (which was established in 1989 and re-oriented in 1998 towards preparation for accession) finances projects linked to the transposition of the acquis and institution building across all sectors. An increasing proportion of these projects is delivered by twinning (twinning provides the framework for administrations and semi-public organisations in the candidate countries to work with their counterparts in Member States in order to implement the acquis communautaire). PHARE also finances investment projects in the areas of cross-border co-operation and (since 2000) economic and social cohesion that are not covered by the ISPA and SAPARD instruments. Finally, PHARE helps to meet the cost of participation in EC programmes and agencies.

The PHARE programme committed a total of € 1.35 billion to Bulgaria during the 1992-2002 period. The 2003 PHARE Programme for Bulgaria consisted of an allocation of € 94.9 million for the National Programme, complemented by € 28 million for Cross Border Co-operation. The PHARE 2004 national programme allocated a total commitment of € 172.5 million. In 2004, the CBC programme for Bulgaria totals € 36 million of which € 20 million for the CBC Bulgaria-Greece, € 8 million for the CBC Bulgaria-Romania, € 3 million with Turkey, € 2 million with the former Yugoslav Republic of Macedonia and €3 million with Serbia and Montenegro. Most of the projects under the PHARE budget 2004 cover a multi-annual period with indicative budgets and actions for 2005 and 2006. The PHARE 2005 national programme allocated a total commitment of € 174.9 million and the CBC programme totals € 40 million of which € 20 million for the CBC Bulgaria-Greece, € 8 million for the CBC Bulgaria-Romania, € 5 million with Turkey, € 3 million with the former Yugoslav Republic of Macedonia and €4 million with Serbia and Montenegro. In addition, Bulgaria benefits from PHARE-supported horizontal and multi-country programmes, including TAIEX (Technical assistance office) and the SME (Small Medium sized Enterprises) Finance Facility.

In addition to its annual PHARE allocation, Bulgaria receives additional funding in the context of Bulgaria’s commitment to close units 1-4 of the Kozloduy nuclear power plant (see below under “nuclear safety”).

The ISPA programme (which started in 2000) supports environmental and transport infrastructure projects. Bulgaria was allocated € 104.0 million from ISPA in 2000, € 106.8 million in 2001, and € 10.6 million in 2002. The budgetary commitment in 2003 was €112.6 million and the allocation for 2004 was €134.8 million. The ISPA programming framework is governed by environment and transport strategies drawn up by the Bulgarian authorities and agreed with the European Commission. In the transport sector, important projects were approved for ISPA funding in 2000 to 2003, especially concerning the transit roads rehabilitation, the Sofia airport reconstruction and extension. In the environmental sector, ISPA will focus on projects located especially in the field of urban wastewater treatment plants and the rehabilitation of wastewater treatment facilities for a set of towns on the sensitive Black Sea Basin. In 2005, the ISPA programme allocated € 134.8 million.

The SAPARD programme (which started in 2000) supports agricultural and rural development measures. Bulgaria’s allocation from SAPARD for 2000 was € 53 million, € 54.1 million for 2001 and € 55.6 million for 2002. The allocation for 2003 was € 56.5 million and the indicative allocation for 2004 is € 68.0 million. In contrast to PHARE and ISPA, SAPARD is a decentralised programme under which the Bulgarian authorities themselves select projects consistent with the agreed programming framework. The SAPARD programming framework is governed by a multi-annual Rural Development Plan, which includes investments in agricultural holdings (30.4% of total allocation of EU finds), improvement of processing and marketing of agricultural and fishery products and construction of wholesale markets (23.2%), forestry, investments in improvement of the processing and marketing of forestry products (8.1%) and renovation and development of villages, protection and conservation of rural heritage and cultural traditions (7.7%). In 2005, the SAPARD programme allocated € 68 million.

The other EU institution that is actively involved in Bulgaria is the European Investment Bank (EIB), which provides large scale loans to projects aimed at helping the transition to a market-based economy and meeting the acquis. EIB action is co-ordinated with the PHARE programme, as well as with EU Member States’ financing institutions and with the European Bank for Reconstruction and Development (EBRD). The activities of the European Investment Bank in Bulgaria started in 1991, and since then the EIB has granted over € 1 billion to priority projects in the country. Some 65% of this amount went to the transport sector while the rest financed key infrastructure and industrial projects with a European dimension. The EIB investments in Bulgaria from 2000 to 2005 are the following: € 160 million (2000), € 130 million (2001), € 87 million (2002), € 60 million (2003), € 40 million (2004) and € 30 million (2005).

Finally, the Accession Treaty foresees for the first year of accession a Transition Facility, a temporary financial assistance of € 82 million (together with Romania), to develop and strengthen their administrative and judicial capacity to implement and enforce Union law and to foster exchange of best practices among peers (Article 31) and for the period between the date of accession and the end of 2009 a Cash-flow and Schengen Facility of € 239 million (in total) to help Bulgaria to finance actions at the new external borders of the Union for the implementation of the Schengen acquis and external border control and to help improve cash-flow in national budgets (Article 32). In addition, it also foresees, without prejudice to future policy decisions, on the one hand an overall commitment appropriation for structural actions over the three-year period 2007-2009 of € 2300 million (in total) (Article 33) and on the other hand budgetary allocations in the field of rural development over the period 2007-2013 of € 1552 million (in total) (Article 34).

Contractual Relations

The Europe Agreement between the EU Member States and the Republic of Bulgaria was signed in March 1993 and entered into force on 1 February 1995 (Europe Agreement The trade and trade-related matters of the Europe Agreement entered in force on 31 December 1993.). This Agreement provided a framework for the political dialogue and aimed to establish a free trade area between the Community and Bulgaria, to provide a basis for economic, financial, cultural and social co-operation, to support Bulgaria’s efforts to develop its economy, to complete the transition into a market economy and to provide a framework for the gradual integration of Bulgaria into the Community.

Within the framework of the Europe Agreement, regular meetings are held at political and services levels (Association Committee and sub-committees on specific areas). The latest Association Committee took place in Sofia on 14 March 2006.

With regard to the bilateral EU-Bulgaria trade, the relative share of the Bulgarian exports to the EU decreased from 60.1 % (€ 4010 million) in 2003 to 58.3% (€ 4654 million) in 2004. It went further down to 57.7 % in the first 10 months of 2005. Bulgaria’s main industrial exports to the EU in 2004, in absolute terms, were textiles and clothing, and iron and steel. Bulgaria’s main agricultural exports to the EU were cereals, oil seeds and oleaginous fruits and meat. In 2004, imports from the EU accounted for 54.1 % (€ 6284 million) of Bulgaria’s total imports down from 55.3 % (€ 5319 million) in 2003. Bulgaria’s main industrial imports from the EU in 2004, in absolute terms, were machinery, mechanical appliances and electrical equipment. Its main agricultural imports were meat, fats and oils, and fruits and nuts. The EU’s surplus in EU-Bulgaria trade relations has increased every year since 1999 and in 2004 the surplus reached € 1,627 billion, which meant an increase of 24.5 % compared to 2003. However, in the first ten months of 2005, for the first time since 1999, the surplus fell back to € 1388 million.

Nuclear safety

The European Union has repeatedly emphasized the importance of a high level of nuclear safety in candidate countries. In the field of nuclear energy, Bulgaria operates the Kozloduy nuclear power plant (NPP) with two units of the VVER 440/230 design type (Units 3 and 4), and two units of the VVER 1000/320 design type (Units 5 and 6). Reactors 1 and 2 were shut down for decommissioning in December 2002 and reactors 3 and 4 will be closed down for decommissioning in 2006 in line with the Accession Treaty.

The assistance provided by the EU to the decommissioning efforts of these four units by Bulgaria has been extended and will be distributed as follows:

Pre-accession (2000-2003)

€ 155 million

Understanding of 1999. Phare Special Programme

€ 155 million already committed.

Additional
pre-accession
(2004-2006):

€ 185 million

Phare programme

€ 135 million committed

Post-accession

€ 210 million

Included in the financial package 2007-2013

2007: € 70 million
2008: € 70 million
2009: € 70 million

 

The funds are largely managed by the EBRD through the Kozloduy International Decommissioning Support Fund (KIDSF), to which other donors also contribute. Bulgaria also participates in and benefits from PHARE-funded multi-country and horizontal programmes, such as the nuclear safety programme.

The KIDSF is composed of two windows: the ‘nuclear window’ focused on dismantling activities and the ‘non-nuclear window’ aiming at improving Energy Efficiency and developing the use of Renewable Energy in Bulgaria.
The Bulgarian Government approved of the construction of a new nuclear power plant in Belene (Northwestern Bulgaria) in April 2005.

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