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PFIA WILL INSPECT BLAGOEVGRAD MUNICIPALITY AFTER A SIG-NAL OF THE ANTI-CORRUPTION FUND

Topic:

PFIA WILL INSPECT BLAGOEVGRAD MUNICIPALITY AFTER A SIGNAL OF THE ANTI-CORRUPTION FUND

Status:

INSPECTION

Stage:

SIGNAL

PFIA WILL INSPECT BLAGOEVGRAD MUNICIPALITY AFTER A SIGNAL OF THE ANTI-CORRUPTION FUND

Further to a signal filed by the Anti-Corruption Fund (ACF), the Public Financial Inspection Agency (PFIA) will inspect a public procurement for the provision of LED lighting to the town of Blagoevgrad in Southwest Bulgaria.

The signal was lodged by ACF on 28 September 2018 and alerted to some irregularities in an annex to a contract between the municipality and a private company, LED Svetlina 2015.

The contract (amounting to 1,845,663.56 BGN, VAT included) was signed on 2 December 2015. More than a year later, on 6 June 2017, the two parties signed an annex for another 433,363.19 BGN, VAT included, through which they assigned some additional construction activity due to contingencies that had arisen.

Contingencies have been identified with regard to 45 out of a total of 47 subsites of the project. The expert opinions most often mention the following contingencies: badly corroded poles, absent poles as a result of road accidents, defective cables, impossibility of remodeling the existing double and quadruple arms for pillars with the purpose of installing the new luminaires.

Other circumstances, necessitating the implementation of extra construction works, also included inappropriate height of the existing luminaires and inadequate location of the existing poles.

Further to a request for access to public information sent by ACF, Blagoevgrad Municipality replied that, before the public procurement was commissioned, a comprehensive analysis of the street lighting system had been made and a large volume of information on the various elements had been collected and processed.

Considering the fact that such a thorough analysis was made prior to the granting of the public procurement, the need of implementing additional activities amounting to 433,363.19 BGN with VAT arouses suspicion.

The ACF legal team cautions that the commissioning of extra construction and installation works and the altering of already-signed contracts are admissible by law in principle. However such changes may be implemented only if certain conditions are met, including the existence of contingencies.

Contingencies are circumstances, which have arisen following the signing of a contract and have not been caused by any action or lack of action on behalf of any of the parties. The contingencies cannot be prevented, even if the due efforts are made, and they make the implementation under the agreed conditions impossible.

The records (protocols) of findings revealed that the situation on site necessitated construction and installation works outside of those specified in the contract. The protocols, however, did not point out the reasons why the extra activities had not been included in the initial project and the 2 December 2015 contract.

In addition, the annex-related payment was made on 7 July 2017. Some 20 days earlier, the Municipal Council – Blagoevgrad rejected the mayor’s proposal for amending the municipal budget in order to pay the contractor. It was only on 12 July 2017, after the payment had been made, that the mayor lodged the proposal for the second time and it was approved by the municipal counsellors.

Following a signal sent by ACF, we have been informed that PFIA officials are planning to carry out a financial inspection of Blagoevgrad Municipality. PFIA will check whether the law was observed upon the signing of the annex, and will inspect the implementation of the contract, the annex, and the payments made with regard to them.


Criminal Procedure Code of Bulgaria

Cooperation by the public
Article 204: Pre-trial bodies shall widely use the assistance of the public in order to discover the criminal offence and to elucidate the circumstances of the case.

Obligation of the citizens and officials to notify
Article 205: (1) Where they come to know about a perpetrated publicly actionable criminal offence the citizens shall be publicly obligated to notify forthwith a body of pre-trial proceedings or another state body. (2) Where they come to know about a perpetrated publicly actionable criminal offence the officials must notify forthwith the body of pre-trial proceedings and take the necessary measures for the preservation of the general setup and data about the crime.