26.3.2007

BRAWL OVER MALL IN BULGARIA'S STARA ZAGORA

09:00 Mon 26 Mar 2007 - Petar Kostadinov

HONORARY CITIZEN: In 2000, Oded Lev was proclaimed an honorary citizen of Stara Zagora. Today he is suing the municipality for damages and future losses.
A dispute between a private investor and Stara Zagora municipality over land intended for a shopping mall appears to be headed for court.
At the centre of the dispute is land that Agrosun, a company owned by Israeli businessman Oded Lev, says that it was awarded in a 2005 court decision after a disputed tender process. Agrosun intended to use the land to build a mall.
But the city’s municipal council voted on March 20 this year, with 36 votes in favour, eight abstentions and none against, to start a new bidding procedure, naming a price much higher than the originally agreed sum.
The council’s new decision set a starting price of 5 870 000 leva for the 9260 sq m plot, which is near the city’s bus station in the Industrialen area.
Lev, who was the first foreign investor to put money into Stara Zagora back in 1993, put in a bid in the 2005 tender of 2.74 million leva, while Germany’s Kaufland offered 1.9 million leva.
The 2005 tender committee said that it saw a text written on the outside of the envelope of Agrosun’s offer and decided that the company would not be allowed to continue its participation in the tender. Since the law provides that no less than two candidates may take part in a public tender, the municipality extended the application period.
A third company, Spain’s Commercia Bulgaria, offered 2.7 million leva and was declared as the winner of the tender by the municipality. Agrosun went to the Supreme Administrative Court to appeal against the municipality’s decision to cancel their tender.
The court overturned the municipality’s decision to award the tender to Commercia Bulgaria and said that the municipality should choose between Agrosun and Kaufland.
Kaufland withdrew from further participation in the tender. At this, the municipality said that only one candidate, Agrosun, remained and said that the law required that a new tender procedure be started.
“That way, the councillors clearly disregarded the court’s decision,” Lev told The Sofia Echo on March 19.
Shai Lev, Oded Lev’s son and an Agrosun board member, said: “This an illegal act by the city council.”
The Sofia Echo tried to contact Anton Andronov, chairperson of Stara Zagora municipal council and former mayor, but Andronov could not be reached.
The municipality and Andronov’s company Zagore 97 said Andronov was constantly “on the move”.
The municipal media office provided the text of the March 20 decision but declined to comment on behalf of Andronov.
Going by what Andronov has told Bulgarian-language media in the past few months, the municipality’s position can be understood as being very simple: “If we do a new tender now, we can get not 2.7 million leva (Agrosun’s offer) but 2.7 million euro,” Andronov told Bulgarian-language daily Dnevnik in February.
According to Oded Lev, Stara Zagora mayor Evgenii Zhelev was heard as saying at the time of the opening of Agrosun and Kaufland’s envelopes that the city wanted more money for the plot.
Lev said: “This is not a legal argument because they can want a lot of things. Since they want more money I do not understand why Commercia Bulgaria, who offered less money than we did, was selected as the winner.”
He added: “What could happen if real estate prices continue to go up and the municipality decides to cancel another tender because the prices have changed, for more money? Why do you do a bid when you do not follow your own procedures?”
Lev said that the municipality had sent a letter to him asking for more money after the bid. “They did not name a number. We answered that we are willing to give more money but as an investment in the city’s infrastructure.”
Lev said that a councillor had termed the response to be an offer of a bribe, “but we did not offer envelopes with cash, we offered investments in the city’s infrastructure”.
“Councillors took the law into their own hands. We have the court’s decision; the councillors disobeyed it and we will sue them for future damages and current losses. We will not give up, and we will even take the case to the court in Strasbourg, and this will be a test case for accepting Bulgaria in the EU. We have written to Prime Minister Sergei Stanishev and the European Commission,” Shai Lev said.
Added Oded Lev: “Everybody is saying here in Bulgaria that the legal system is not working. I think otherwise. It has worked for me.
The problem is that councillors do not want to follow the court’s ruling.”
While both Lev and councillors were gearing up for a court hearing, Bulgaria’s Alexandra Group started construction of its Mall Stara Zagora in the eastern end of the city.