Банкеръ Weekly



The admission for reconsideration of already effected privatisation deals was the major issue when the Parliamentary Economic Commission was discussing on second hearing the new Act on Privatisation and Post-privatisation Control. On principal, the majority does not approve of the additional bids for a reduction of the commitments under the investment programme or for maintaining a minimum number of working positions. The MPs, however, are worried that after banning the renegotiation of deals, several hundred of enterprises could go bankrupt, which would result in a new boom of unemployment. The reason is that under the closed contracts, the fines are projected at between 50% and 150% of the non-fulfilled commitments. In that connection Deputy Premier and Minister of Economy Nikolai Vassilev proposed that this coefficient should be reduced to 20% for example. Such a provision will be probably included in the law. The exact size of the reduction, however, is to be set by the MPs.There were also proposals that the fines should not be reduced, stipulating an opportunity for paying them by compensation instruments, but the idea was not accepted by Mr. Vassilev. Nevertheless, the discussion of this issue was postponed for the next session of the Parliamentary Economic Commission.Nikola Nikolov from the United Democratic Forces (UDF) was of the opinion that no reductions should be made. He said the practice so far was not to undertake unreasonably high commitments for investments. If the new terms were calculated after the renegotiation, it could turn out that according to real parameters the privatisation tender was won by the second, third, or even fifth bidder. Ivan Ivanov (from the UDF again) proposed that an opportunity should be stipulated for a revision of the promised working positions, but not of the investment programme. His motive was that lay-offs could be sometimes necessitated by force majeure circumstances, as was the case when navigation along the Danube stopped after the war in Yugoslavia. However, the lawyer Konstantin Penchev from the National Movement Simeon II argued that in such cases the owner of an enterprise could establish his rights in court. It is the magistrates and not the Agency for Post-privatisation Control (APC) that should decide if the owner was really impeded from fulfilling his commitments.Mr. Vassilev's stance was that if an opportunity for reconsideration of closed contracts was stipulated, the APC would be jammed by about 3,000 proposals for annexes. But this will obviously not happen, as the APC will be simply monitoring the observation of already signed contracts and will be imposing the sanctions stipulated in them.

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