MEDIA SOUND & PUBLIC FURY IN BOYKO BORISOV'S BULGARIA

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During the past several weeks Boyko Borisov's Bulgaria has been shaken by a major scandal. No, it is not the constantly being stopped and restarted multibillion-euro Belene Nuclear Power Plant project, it has nothing to do with Bulgaria's continuing dependency on Russian gas and oil, nor with the state of the Bulgarian judiciary system.

It is not even about the prime minister being caught on tape ordering the chief of customs to terminate a tax investigation of a shady beer brewer because he had his "commitments" – and then the brewer, his wife and the chief of customs dying in circumstances that conveniently have gone down in Bulgarian legal history as "unsuspicious."

It is not about Tsvetan Tsvetanov, Boyko Borisov's GERB's second-in-command, purchasing several apartments in Sofia with money he had "borrowed" from his retired mother-in-law. It is not about Tsvetanov's latest real estate acquisition, a well-appointed flat in a tony Sofia neighbourhood, in a luxury building, where former Justice Minister Tsetska Tsacheva, Borisov's handpicked presidential candidate in 2016, also happened to own a flat.

No. It is about nothing of those. It is about a... private lift Tsvetanov had installed for himself, designed to take him straight from his garage to his new residence outside the scope of the prying eyes of neighbours and journos.

Property ownership is something that the overwhelming majority of Bulgarians hold very close to their hearts. For a Balkan man, owning a house and a car, preferably with a garage thrown in, has for generations been the ultimate symbol of self-fulfilment and success in life. It is not difficult to understand why. Under Communism with its rules and regulations, owning an apartment was perhaps the only way to invest whatever currency Bulgarian families had at their disposal. Of course, there was no free market for housing and people usually had to wait many years to be "allocated" a spot of a living space in one of the prefab projects still encircling all Bulgarian towns and cities. Building societies and mortgages were unheard of. Everyone paid in cash.

When Communism collapsed in 1989, Bulgaria emerged as one of the countries in Europe with the highest percentage of home owners. The parents of the 1960s, 1970s and 1980s struggled to make sure their children would have a "roof over the head" for themselves. With the market liberalisation of the 1990s and especially the 2000s, Bulgarians of all shades, colours and financial means rushed to buy real estate, with one of the results being that many of those new flats now stand empty because the grown-up kids are in London and Chicago with only hypothetical intentions to return.

To cut short the long story of the Bulgarian psychological disposition toward property, buying flats, especially flats beyond the reach of ordinary Bulgarians struggling to make ends meet, is readily understandable to the overwhelming majority of citizens. It is a lot more real-life than the several billion euros needed for the construction of a new nuclear power plant. Knowing that someone you have elected to a high public office on his promises to fight corruption has just acquired a private elevator – significantly, at a fraction of its market price – hurts. You know you will never be able to do the same.

The media revelations about Tsvetanov and Tsacheva quickly snowballed to entail a number of other high-ranking GERB officials who had also bought properties at considerably lower prices. To add insult to injury, one of them was Plamen Georgiev, the head of the Commission to Seize Illegally Acquired Assets, known to Bulgarians by its monstrous acronym, KPKONPI. That commission, set up under Western pressure in 2012, has the authority to seize assets, without a court order, it considers acquired illegally. Citing the success of similar agencies in the West, Western ambassadors to Bulgaria insisted on having it set up, perhaps not realising that whatever worked in societies with sound judicial systems and plenty of checks and balances might not necessarily work the same way in Bulgaria – especially not when it is run by an authoritarian leader who often acts on whims and quirks rather than the basis of the law. Georgiev, it emerged, had bought a luxury property with a huge balcony where a grill and a six-person sauna had been installed. Importantly, Georgiev joined the company of l GERB low-paying property customers in that he had paid significantly less for what apparently cost significantly more.

Georgiev responded by saying there was an "error" in his title deed – and promptly produced a new, backdated one that stated a different amount of money. He also said that the balcony in question did not belong to him as it was considered communal property for all home-owners in the building. Regardless, he had already used it as a collateral for a bank loan...

Foreboding an avalanche of revelations about other senior public figures acquiring ridiculously cheap properties and all the implications it would hold for the impending European Parliament elections scheduled for May, Prime Minister Boyko Borisov spun the situation the only way he knew. Appearing characteristically stern-faced on TV, he promised uncompromising justice. Tsvetanov, Tsacheva and others were forced to resign. Georgiev was put on leave while a "prosecuting probe" went ahead. The prime minister once more assumed his favourite pose: he stood clean-handed above some delinquent subordinates.

But will the tried-and-tested trick work this time around? Will not the current scandal, which has lasted unusually long even in Bulgarian standards, not sound the death toll for GERB and Borisov's establishment?

In the complicated realities of Bulgaria of 2019 the answers are at best ambiguous.

To make informed guesses, one needs to analyse Apartment-gate's three quite distinct implications: legal, political and media.

At first sight it appears that Tsvetanov, Tsacheva and the rest of the cheap buyers did nothing illegal. To understand that, one should consider the peculiar – but by no means only Bulgarian – system of local tax authorities producing a tax evaluation for each property that changes hands. It is a hypothetical evaluation, based on many parameters, which in theory is used to calculate the amount of tax due for each transaction in real estate. Usually, the tax evaluation is lower – in many cases significantly lower – than the market price of a property. It is not illegal to buy at that tax evaluation price. It is not illegal to buy even below the tax evaluation price. However, if anyone does that, they will still be required to pay the tax due as stated in the tax evaluation price.

In that sense, neither Tsvetanov, nor Tsacheva did anything wrong. They just bought cheap. They avoided, but not evaded, paying more tax.

There are important details, however. Every title deed issued by a Bulgarian public notary is required by law to state the actual price of a property being sold and bought. If there is a discrepancy between the tax evaluation and the going price, the higher should be noted in the title deed, requiring higher tax to be paid. Coupled with the obligation to pay for real property by bank transfer only – in effect terminating the practices of the past to produce wads of cash at a notary's office – the system has been designed to prevent tax fraud. If it is discovered that Tsvetanov, Tsacheva et al did not have the real price for their new residences noted in their title deeds, they must be prosecuted for tax evasion.

There is also another important detail. Corruption in Bulgaria is no longer of the old-fashioned money-under-the-table kind. Under Borisov, it has become a lot more sophisticated. Often, it involves no money at all. It is all about influence, favouritism and nepotism. It is a constant process of mutual back-scratching and exchange of favours – in anything from hospital treatment to lucrative road construction contracts. Whether Tsvetanov and Tsacheva did anything for the construction company selling them so cheap remains to be seen. Whether the building company actually sold its flats dirt cheap as a "compliment" to two powerful public figures to win their disposition is not to be ruled out either. In any case, establishing any direct link of the kind that can hold water in a court of law will probably be very difficult.

Notwithstanding the legal implications, there is the political fallout. Tsvetanov resigned from parliament where he was the leader of the GERB group and the chairman of the internal security commission. However, he preserved the position that is most significant for GERB in general and Borisov in particular, that of chief elections organiser. Using the methods of the Bulgarian Communist Party, in which both he and Borisov have a footing, Tsvetanov has set up GERB party cells throughout Bulgaria. He has handpicked election candidates locally in cities, towns and even villages, and has ensured they get elected by placing them in the right places in the electoral lists. These people in Varna, Yambol and elsewhere are indebted to GERB in general and Tsvetanov in particular. Should Tsvetanov be sacked, the support base for GERB will be significantly altered. With the removal of Tsvetanov from parliament, Borisov has managed to both calm down, to an extent, the public outrage, and preserve Tsvetanov where he needs him most: election engineering in the provinces.

In the early stages of Apartment-gate Borisov asked a question that in other societies with smoothly functioning legal and political systems may have seemed irrelevant but that in actual reality is very pertinent to any public scandal that breaks out in Bulgaria: who benefits from it? Who masterminded the release of the cheap flats information two months ahead of a scheduled election that will be seen as a public opinion poll on GERB's continuing popularity, or the lack thereof?

The knee-jerk response of most Bulgarians would be GERB's arch-enemy, the Bulgarian Socialist Party, or BSP. Speaking to reporters, Tsvetanov actually tried to put the blame on what he called the Kremlin's hybrid warfare and its chief allies in Bulgaria, the former Communists. This may sound plausible to GERB's hardcore supporters (because GERB sometimes says it is anti-Communist), but in actual fact has little to do with the truth. Obviously, some people who are disgusted with Tsvetanov's "immoral" real estate dealings will not cast their votes for GERB. They are highly unlikely to revert to the BSP (which rarely if at all condemns its predecessor, the Bulgarian Communist Party, – and Communism as such). Instead, they may embrace one of several small, extra-parliamentary political parties identifying themselves as being rightwing, pro-democracy, pro-EU and anti-Russian associations of urban intellectuals that failed to garner enough public support at the latest general election and that are now outside the Bulgarian parliament.

These include the DSB, or Democrats for Strong Bulgaria, the political party of former Prime Minister Ivan Kostov, and Yes Bulgaria – a newly founded political grouping set up and led by a former lawyer, Hristo Ivanov. Yes Bulgaria commands the support of a small group of intellectuals mainly in Sofia, who are very vocal on social media. What unites them, apart from their criticism of GERB, is their blanket rejection of Russia, their religious belief in the veracity of the files of the Communist-era secret services, their conviction that Lockheed Martin-manufactured F-16s are better than Swedish Gripen fighter jets, and their condemnation of the quality of the still ongoing construction works along Graf Ignatiev Street in Central Sofia. Ivanov, who was briefly a justice minister for Borisov but resigned over his failure to kick off the much-needed reforms of the judiciary, was the only political leader to come up with an unambiguous statement as soon as Apartment-gate broke out. In it, he called on his supporters to vote for his party rather than GERB.

This has generated the conspiracy theory that Ivanov and his allies may have sparked the Apartment-gate scandal in order to capitalise on it.

At first glance, there may be some truth in this. The first reports about Tsvetanov, Tsacheva and the others buying cheap flats was promulgated by a local US-sponsored NGO called Anticorruption Fund through Free Europe, a recently restarted Internet-only version of the legendary Cold War US broadcaster Radio Free Europe, or RFE. The managements of both are known to have had links to Yes Bulgaria.

However, the basis for the conspiracy theory ends here. The Anticorruption Fund essentially verifies reports about public contracts carrying "high corruption risks" and alerts the investigating authorities of its findings. Its site is still rudimentary, but it does contain a form where readers can submit tips.

Free Europe is an independent news organisation sponsored through a grant by the US Congress. It has to obey a strict and very transparent code of professional conduct, and it seems unlikely it has disseminated any doctored information regarding Apartment-gate.

Curiously, Free Europe's Apartment-gate reporting seems to be a departure from established practices in that a US-sponsored news organisation used the reports of a Wikileaks associate: Bivol, a local Internet site that claims to be a whistleblower and an investigative reporter, usually peppered with strongly-worded political positions. Bivol has become one of the few media outlets to unequivocally express support for Julian Assange when he was arrested in London earlier in April, demanding of the UK government not to extradite him and thus protect "freedom of speech." "We can guarantee first-hand that Assange and his colleagues maintain high standards of security, double-checking and verifying the information they release, and are motivated first and foremost by the public interest," wrote Bivol.

Bivol is partly owned and run by Asen Yordanov, a Burgas-based journalist, who has been sharply critical, almost vitriolic, of Boyko Borisov and his dealings. Interestingly, Yordanov is the brother of Nedyalko Nedyalkov, who runs Pik, a major media that is sharply critical, almost vitriolic, of anyone who has expressed any criticism for... Boyko Borisov.

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