ACF Asks Rosen Zhelyazkov About Probes into Hristo Kovachki's Orion Holding

The Anti-Corruption Fund Foundation (ACF) sent an official inquiry to Prime Minister Rosen Zhelyazkov after yet another change in ownership of key companies in Bulgaria’s energy sector.

In June and October this year, four UK-registered companies with portfolios featuring major Bulgarian energy enterprises – including Bobov Dol TPP, Brikel TPP, and heating companies in Burgas, Pleven, and Ruse – changed ownership.

Back in the spring, ACF shed light on the links between the UK companies and Hristo Kovachki, revealing for the first time evidence that the businessman is their ultimate owner.

ACF then identified more than 150 Bulgarian companies as part of an informal network called Orion Holding. At least 70 of these companies belong to British and Cypriot owners. A check in the UK’s companies register showed that a total of 20 British companies own Bulgarian companies linked to Mr. Kovachki’s holding. The British companies are registered as dormant companies, i.e., without any commercial activity and published assets, with a capital of £1.

“It turns out that Bulgaria’s regulatory agencies and national security authorities have allowed shell companies to own energy companies that produce a significant percentage of Bulgaria’s electricity and provide heating services to institutions and tens of thousands of families,” said Lora Georgieva, legal expert at the ACF.

“The so-called dormant companies hide the real owner so that he cannot be held accountable. Another problem is the possibility of creating cartel structures that hinder free competition, distort the market, and—as we showed in the Mr. Grass Head investigation— evade paying millions in taxes and social security contributions.”

And while there is no information on whether and how the authorities are following up on the evidence, provided by the ACF, of suspected violations by Kovachki’s companies, some of these companies already have new owners. The register entries were made between 4 July and 13 October, and all of the new owners are Cypriot citizens — facts that support the conclusions of ACF’s investigation pointing to coordinated actions between the companies.

New entries in the UK’s Companies House
Since 4 July, STOCKETT LIMITED, owner of the Bobov Dol TPP, Consortium Energy MK, Chukurovo Mine, and TBD – TOVARNI PREVOZI, previously owned and represented by Erlene May Rodriguez of Belize, is owned and represented by Antriana Christodoulou from Cyprus.
Since 8 July, BOVARD LTD, owner of the district heating company in Burgas, previously owned and represented by Nancy Bennet, is owned and represented by Styliana Tryfonos from Cyprus.

Since 10 July, CATALAND LTD, which owns the district heating companies in Pleven and Ruse, and D CONSEY, previously owned and represented by Sarah Amy Grice, is owned and represented by Fanos Kasapis from Cyprus.

On 11 July, BAKKAR LIMITED, which owns Brikel TPP in Galabovo, previously owned and represented by Roy Dennis Tolfts, is owned and represented by Michalis Fanouriou from Cyprus.

On 13 October, the owner and manager of DOWAN LIMITED was also replaced. The company, which owns Eco Analysis and Carbon Invest and was previously owned and represented by Tamara Lilian Ibanez, is now owned and represented by Niki Sofokleous, also from Cyprus.

This is not the first evidence suggesting coordinated actions among these companies. A check by the ACF shows that eight of the 20 companies were registered on 20, 21, and 22 May 2014, and one was registered in September 2014. The remaining eleven companies were registered in 2015, between 30 April and 15 July 2015. Five of the eleven companies were registered on 6 May, and three of them on 27 May. There are interesting coincidences in the addresses and owners of these companies. For example, in the past decade, six of the 20 companies were located at SW11 2JR, and nine at WF1 5QW.

Institutional reactions
On 6 June this year, in response to a question from MP Lena Borisova, Prime Minister Rosen Zhelyazkov announced at the National Assembly that AFC’s investigation contained evidence of possible criminal activity and provided sufficient grounds for the Prosecutor’s Office of the Republic of Bulgaria to initiate action. The prime minister also announced that he had instructed the ministers of finance, energy, and environment and water to carry out checks.

At the end of last week, the ACF sent an official inquiry to Rosen Zhelyazkov regarding the actions taken by the relevant ministers and other public institutions.

“The public deserves to know the whole truth about the shady Orion Holding, and this is why we asked the prime minister about the results of the checks he had ordered,” said Boyko Stankushev, director of the ACF. “We asked Mr. Zhelyazkov whether he had referred the case to the Prosecutor’s Office or whether he was aware that it had taken up the case on its own initiative.”
The ACF insists on full transparency and decisive actions by all Bulgarian public institutions.