January 2000

Bulgaria Update Memo

The following report outlines new developments in the past three months and the state of on-going developments.

1. On going changes in the regulatory framework

Serious structural reforms in the central public administration have been announced at the end of 1999 (21 December) and after Bulgaria has been invited to negotiations with EU. The former Committee on Posts and Telecommunications becomes part of the Ministry on Transport and Telecommunications.

2. Legislative reforms

There are several drafts for amending and supplementing of laws, defining legal framework of the information sphere, such as Telecommunications Act, Radio and Television Act and Copyright and Neighbouring Rights Act.

There are changes in the list of telecom services licensed according to the law. With the amendment of the Ordinance 09-235/98, requiring inter alia that Internet service providers (ISPs) offering Internet connectivity to the public have to be licensed, this regime was changed and in fact licensing of ISPs will not start in this country. More active ISPs self-regulation is expected.

3. The issue of numerous licences in liberalised telecommunications fields

In Bulgaria, a lot of licences were issued: 33 telecom licenses to regional terrestrial radio-operators, 20 programming licenses to regional terrestrial radio-operators, over 100 programming licenses to Cable TV distributors.

The tender for the first private national terrestrial television has been finished. Three programming licenses have been granted to the Bulgarian company of SBS Broadcasting and the EBRD, the Bulgarian company of Swedish company MTG Broadcasting and to Rupert Murdoch's Bulgarian company "Balkan News Corporation". Only one of them - Rupert Murdoch's Bulgarian company "Balkan News Corporation" - have got a telecom license for terrestrial broadcasting, the other two operators will probably transmit their programs by satellite. The winner was announced on December 21, the license would be issued as early as January 2000.

4. Privatisation of the national telecom operator BTC

The national operator, Bulgarian Telecommunication Company, is to be privatised and the second GSM license will be granted as a part of the privatisation procedure. The government officials are negotiating with the potential buyer of 51 per cent stake in the Bulgarian Telecommunication Company – a consortium which includes the Greek operator OTE and KPN Royal Dutch operator – however, it is not excluded the negotiations with other potential buyer as starter.

5. Y2K

According to the opinion of World Bank, Bulgaria is very well prepared to handle any Y2K-related problems. There are eight regional centres worldwide and one of them is in this country. The operation of computer systems will start to be monitored around the world at 3 am GMT on December 31. The Centre will later be transformed into a crisis management centre.