This is the latest of a series of signals at NOresharski.com regarding public procurements financed entirely or in part by the EU and frozen or terminated at key points of their execution. The cabinet is taking purposeful decisions with the clear notion that not only are important strategic projects being fatally delayed, but also that the EU will no longer be willing to fund these projects once (if) they are resumed. The only conclusion that we are able to draw is that the new government will try to renegotiate all of Bulgaria’s strategic projects with new subcontractors in nontransparent, under the counter ways. The ones on the losing side of the bargain are, of course, the citizens of Bulgaria.
Late in 2012, the Decision № 124/09.10.2012 of the director of the Agency for Roads and Infrastructure (ARI) commenced the procedure of assigning a public procurement with the aim of “Selecting a contractor to design and build the Northern tangent from 0+000 km to 16+540”. Early in 2013, with its Decision №52/29.04.2013 ARI selected the joint enterprise Salini-Impregilo (based in Rome, Italy) as the contractor. The Italians provided the most cost-efficient offer and were given the highest collective score ( 89.676) out of all the prospective contractors. The company is well-known in the road construction business and combines Salini’s innovative technologies with Impregilo’s 100 year experience in building projects. The fact that, a few days ago, the company won a 6 billion dollar contract to build the subway lines in Saudi Arabia can only be seen as proof of its high expertise.
The second-best score (79 points, more than 10 points lower than Salini-Impregilo’s) was given to the consortium „HPBS-SST” [ХПВС-ССТ]. It is interesting to note that one of its members, the company “Vodproekt 98” has no prior experience in road construction, but is connected to Delyan Peevski and generally “wins” all the bids it participates in.
Another seven contestants had been disqualified because of discrepancies in their documentation.
Before the construction of the northern arc of Sofia’s tangential (bypass) road began, the Bulgarian consortium appealed before the Anti-Trust Commission (ATC) refuting the results of the bid and claiming that the choice of Salini-Impregilo as contractor was unlawful and incorrect. The ARI insisted that its decision be carried out and construction be started while the ATC assessed the consortium’s appeal in order not to delay the project, as it was of great social and national significance (it would facilitate vehicles passing in transit through the capital and lighten the traffic in the city). In addition, the project’s unreasonable delay would make it hard to get funding from the EU’s fund “Transport”, which would also have a negative impact on the ARI. The ATC then decided to not delay the project because of its national significance.
But instead of finally beginning the construction, the project is once more delayed. One of the seven prospective contractors that had been disqualified from the bid, the consortium “Porr-Bau” GMBH filed a complaint to the ATC against its disqualification. The ARI insisted that both consortiums’ pleas were unfounded and should not be further assessed by the Commission. ARI also asked ATC to have its juridical expenses covered.
ATC’s decision was that the “Porr Bau” plea was truly unfounded, unlike that of “ХПВС-ССТ”, which was found to be justified. So the procurement was taken away from the Italians on grounds that they had not proven to have a sufficient income from construction contracts and that their team had not shown the necessary expertise and professional experience to carry out the project. The cost of the trial was to be covered by the ARI, whose decision had been tried.
That is how the ATC quickly revoked the ARI’s decision of appointing Salini-Impregilo and gave the procurement to the consortium that had come second in the auction. The ARI was to continue the procedure from the documents verification stage. This way, the ATC practically determined the outcome of the second bid for the procurement, as all the other possible contractors had been disqualified due to discrepancies in their documentation, leaving the consortium as the only possible winner.
Predictably enough, on July 20 2013, Salini-Impregilo filed a plea to the Supreme Administrative Court (SAC) of Bulgaria, in which it identified the ATC’s decision as unacceptable, incorrect and unjustified. There were many discrepancies and inadequacies in the Bulgarian consortium’s documentation, which contradicted the procedural rules. The fate of the Northern Tangent was in the hands of the supreme justices.
But the SAC supported the ATC’s decision of disqualifying the Italian company and cancelled the ARI’s decision which assigned them the procurement. The ARI was again to continue the procedure from the documents verification stage. The directions given by the ATC and SAC were that Salini-Impregilo be removed from the procedure, so that the Bulgarian consortium may win the bid. At the moment, the ARI is preparing to complete these directions.
In May 2013, the supervisor of the governing body of the program “Regional Development” Denitza Nikolova stated that “The only possible way to save the program is a large, completed project like the Northern Tangent. The project was included in the program after the decision of the committee overseeing the program. It is expected that up to 250 million BGN will be saved from the program’s budget. The rest of the funds will go into the construction of the Northern tangent that is to connect “Kalotina”and “Hemus”. It is a crucial project for both the capital and the country as a whole. Plus, its contractor has already been selected and its application form-reexamined.” But instead, what lies ahead of the “Northern Tangent” project are trials in Strasbourg, which will drag on for years, the EU funding for it will be lost, and to top it off, we will have to pay the Italians compensations.
So the question is, why instead of having initiated the construction of the much-needed Sofia Northern tangent, we are trying to drive off a well-known global company and prospective investor, so that the funds for the project can be “used up” by firms connected to the omnipresent Delyan Peevski. Whose interests are being protected by the ATC and SAC, when they are actually revoking a legitimate bid held by the ARI and dictate who is to be the contractor of such an important public procurement? And if the Italians fail to receive justice in Bulgaria, they will surely defend their rights in the European court as well. In the end, the ones who will have to deal with the discomfort of being scolded about the coalescence of politics and business and the loss of the crucial for the country’s economy European funding will be none other than the citizens of Bulgaria.
