Saturday, June 30, 2007

Romania: Cernavoda 3 and 4 decisions forthcoming

The Cernavoda plant was originally intended to host five Canadian Candu pressurized heavy water reactors of 633 MWe each.

Saturday, June 30, 2007
by World Nuclear News

The Romanian nuclear industry expects Cernavoda 2 to begin commercial operation in July and government approval for the completion of units 3 and 4 within days.

Teodor Chirica, CEO of state generator Nuclearelectrica, said that Cernavoda 2 was in the final commissioning stage. After receiving permission from regulators, it had achieved 5% power and would progress to 100% and full commercial operation in July.

He also stated that before the end of June the Romanian government would approve the completion of units 3 and 4. Chirica was speaking at a London meeting, Nuclear New Build: The Role of the Private Sector, on 27 June.

The Cernavoda plant was originally intended to host five Canadian Candu pressurized heavy water reactors of 633 MWe each. Construction on units 2-5 has halted in 1991 in order to concentrate on unit 1, which entered commercial operation at the end of 1996. It now provides 10% of the country's electricity.

The government decided to resume work on unit 2 in 2000. After some upgrades during completion, unit 2 is rated at 655 MWe.

Negotiations to assemble a commercial consortium for the completion of units 3 and 4 are underway. It is expected that a project company would be formed and work begin in March 2008.

Chirica said the 64 month completion project would cost Eur2.2 billion ($3.0 billion), not including the cost of capital, but would result in two 720 MWe units with 30-40 year lives. He projected the cost of electricity generation by the units would be between Eur28.2-32.5 per MWh ($38.1-43.7).

The units would be constructed in parallel with a gap of "a couple of months" between each unit's start-up around 2014-5.

Danube water quality at good level: Romanian official

The water quality of the Danube River remains constant and will be improved, Romanian environmental official Serban Iliescu said on Friday.

"Improvements in water quality became visible in Romania with the decline in industrial activities in the country," said Iliescu, water quality monitoring coordinator of the Romanian National Water Administration (ANAR).

He added "there are plans for the building of water treatment plants in Tulcea and other Danube cities, and I am convinced that once the plans are carried out, water quality of the Danube river will stay at good levels."

Iliescu made the statement in the eastern Danube city of Tulcea, based on the test results conducted by the Danube Caravan program to assess the water quality of the Danube River.

The program, carried out on Danube Day, was aimed at collecting water samples from the Danube.

He said that officials of the International Commission for the Protection of the Danube River (ICPDR) will organize a scientific group, which has attracted researchers from Danube cities, who will test water quality in real time.

The Danube Caravan, set up by the ANAR and the Ministry of the Environment and Sustainable Development under the guidance of the ICPDR, traveled seven cities of Romania from June 15 to 29, with the aim of raising public awareness on the importance of water protection and conservation.

Danube Day was launched by the ICPDR in 2004. All Danube countries organize celebratory events on Danube Day to display their wish to adopt common measures and strategies for the protection of the river against extreme weather and accidental pollution.

Source: Xinhua

Romania: EU's Clarion Call

Oxford Business Group Latest Briefing

Romania, along with fellow new European Union member Bulgaria, has been told in no uncertain terms that it needs to get its house in order to bring the country into line with the membership requirements of the European Union, especially regarding the fight against corruption.

On June 27, the European Commission (EC) released a report on the progress made by the two countries in putting in place reforms and addressing issues left outstanding when they formally joined the EU on January 1 this year.

In handing down the report in Brussels, Justice Commissioner Franco Frattini said that corruption at high levels remained a problem in both countries and needed to be dealt with. He urged them to be more aggressive in implementing anti-corruption and judicial reforms.

In particular, the report said that insufficient measures have been taken to combat high-level corruption in Romania, though it acknowledged significant progress had been made towards the creation of a National Integrity Agency (ANI), which is to be tasked with combating such activity. The agency is expected to be in operation this coming October.

The report also recommended that adoption of the new codes for civil and criminal procedures be finalised, the new criminal code be reinforced and more be done to strengthen the independence of the judiciary, including making it more professional and giving it more funding and powers.

Romania has been told to put in place a coherent countrywide anti-corruption strategy and guarantee the legal and institutional stability of key institutions such as the National Anti-corruption Department (DNA).

While Romania had made progress in addressing weaknesses that could prevent an effective application of EU laws, policies and programmes, this progress was nowhere near enough to warrant an end to the EC keeping the country on its watch list, the report said. The commission said it would issue an updated version of its report on Romania's compliance early next year.

However, the situation was not so bad that the EC was prepared to recommend calling for sanctions to be applied to Romania under the safeguard clause built into its accession agreement. These could have included cutting agricultural subsidies by 25%, freezing other assistance and even suspending some of Romania's EU membership rights.

EC President Jose Manuel Durao Barroso said Romania must focus on implementing required legislation in the monitored fields rather than just adopting new laws or it could still incur the bloc's ire.

"Although at this stage the commission does not recommend any safeguard clause, we will remain vigilant. Acquiring additional necessary changes requires a long-term engagement," said Barroso when the report was released.

Failure to meet the EU's benchmarks could still result in sanctions when a new report is issued in June 2008.

"I would expect Romania and Bulgaria to meet the benchmarks," said Frattini. "They have adopted the laws necessary to get results. Now the focus is on implementation."

Despite the warnings, reactions to the report were for the most part positive.

President Traian Basescu, who has long championed both Romania's EU membership and the fight against corruption, said the report was objective and reflected the developments in judicial reform made since last September, when the EU had tabled its previous assessment.

Justice Minister Tudor Chiuariu also talked up the positives of the report, saying the EC had said progress had been made.

"The report confirms the priorities of my term: the adoption of the ANI law and efficiency in the fight against corruption," he said.

Chiuariu said he would present the government with a comprehensive plan of action to address all of the deficiencies set out in the report by October, as called for by the EC.

In its defence, in the six months covered by the report, Romania has been embroiled in a series of political crises that partly derailed the programme of reforms. The political turmoil centred around a clash between Basescu and Prime Minister Calin Popescu Tariceanu, which briefly saw the head of state removed from office over allegations he attempted to influence senior judges. Reinstated after a referendum in May, Basescu has said he will work with the premier to get Romania's reform train back on track.

Romania needs to address the issues raised by the EC report not only to get Brussels off its back but to counter the negative image corruption gives the country, one that could harm foreign investment and business confidence.

Romania PM supports Moldova's EU accession

Romanian Prime Minister Calin Popescu-Tariceanu Friday voiced support for Moldova's accession to the European Union (EU), saying that Romania wants its neighboring country to be as close as possible to the bloc.

Tariceanu made the statement after meeting with his Moldovan counterpart Vasile Tarlev in the Moldovan city of Chisinau. The two leaders discussed the possibility of establishing a development and cooperation fund aimed at financing Moldova's economic infrastructure and cultural projects.

The Romanian leader also urged his fellow businessmen to invest more in Moldova to help its economy, so it can meet EU economic accession standards at an earlier date.

Moldovan PM Tarlev welcomed any kind of assistance to help it join the EU bloc early. Bilateral trade and economic cooperation between the two countries have been increasing in the past two years, Tarlev said, and he was quite optimistic that they would become more dynamic in the future.

During his one-day short visit, Tariceanu will also meet Moldovan President Vladimir Voronin.

Source: Xinhua

Habsburgs Retain New York Investment Firm for Bran Castle

NEW YORK--(BUSINESS WIRE)--Archduke Dominic Habsburg and his family have retained a private investment firm, Baytree Capital, to create a long-term strategic plan for the enhancement and preservation of historic Bran Castle in the Transylvanian region of Romania.

Under the terms of the agreement, Baytree will have exclusive rights to represent the Habsburgs with regard to Bran Castle and associated properties. Bran Castle has tremendous historical significance to Transylvania and Romania, both real and mythical, and is known throughout the world as Dracula's Castle. This association can be traced back to Irish author Bram Stoker, who used Bran Castle as his inspiration for the settings of his classic 1897 novel, Dracula.

With Romania's recent accession to the European Union, investors from all over the world are seeking to exploit the tremendous economic upswing now underway in the country.

Michael Gardner, Chairman of Baytree Capital, said, "I am privileged and honored that the Habsburg family have entrusted me with the future of this precious asset. Bran Castle is one of Romania's top tourist attractions, and with the expected boom in tourism generated by the mythological draw of Transylvania, the Habsburg family believes that a strategic plan for the development of Bran castle is needed."

Archduke Dominic said, "I chose Michael Gardner to create a plan for Bran Castle because I felt he would do it with the utmost sensitivity towards my family, the castle's history, and our ties to the country. Aside from the castle's connection to one of the most famous novels ever written, Bran Castle is steeped in critical events of European history dating from the 14th Century to the present."

Queen Marie, the Archduke's grandmother, and her family lived in the castle in the early part of the 20th Century. The seven hundred year-old castle was seized from the family by the communist regime in 1948, and was converted into a museum in the late 1950s.

The Bran Castle was rightfully returned to the Habsburg family by the Romanian government in 2006.

Three million Romanians live in poverty

Source: Radio Netherlands Worldwide

The Romanian capital of Bucharest isn't one of the poorest cities in the world. But considering the country joined the rich countries' club - the European Union - at the beginning of this year, poverty in the city is at a disproportionate level. And it's visible.

Showroom manager Mike Costache proudly shows us a 'Gran Turismo', the latest model by exclusive Italian car manufacturer Maserati. The price tag is upwards of 130,000 euros and this year he's already sold 15. "We're considering opening a new showroom in Kluj (a town in the north of Romania, ed.) because there's so much demand." Who are the customers? Mr Costache will say no more than "people in the financial sector". Judging by the stylish appearance of Dorobanti Street, where the showroom is located, there's plenty of trade at the luxury end of Romania's car market. This is where the new rich go to show off their affluence.

Painful transition
If you base your impression on this street, you might conclude that Romania is rapidly catching up with the standard of welfare in the rest of the European Union, the "rich countries' club" to which it has belonged since 1 January this year. After the fall of communist dictator Nicolai Ceausescu in 1989, Romania experienced a painful transition from planned to free market economy. The relative security of an assured income disappeared and the traditional agricultural sector proved to be no longer viable, so a large section of the rural population in particular were plunged into deep poverty.

But since 2000, the country has been experiencing steady economic growth - at a rate of 7.7 percent in 2006. While GNP per capita was only 6800 dollars in 2000, six years later it has climbed to 9165 dollars. It's a leap forwards, but still a long way from the Western European average, and what's more, this is an average figure with extremes on either side. According to the World Bank, 15 per cent of the Romanian population still live below the poverty line. "A lot of people at the bottom end of society have lost out in the economic transition," warns Mariana Stanciu of the Romanian Research Institute for Quality of Life."We're seeing new phenomena: parents emigrate and leave their children behind. It's not clear how the children survive," she continues. "The elderly are also a concern. The poverty is visible, people beg, even if they have an income or a pension."

No social safety net
Romania is a country with no social safety net, as Vasile Vasin discovered. Due to a law that enables people to claim ownership of pre-war property, he lost his home. "A four-room apartment I bought 32 years ago." He is now expected to find a rented house, with no financial compensation. "On an income of 400 lei (about 125 euros) that's impossible" says 63-year-old Mr Vasin, who was a builder all his working life but now has to get by on disability benefit. He currently lives with his wife Greta and their dog in a 1985 Dacia Logan - a car that West Europeans would recognise as a Renault 12 - parked outside his former home.

A sign next to the car doesn't beg for money but simply draws attention to their plight. "Look there are no lights on, the new owner isn't even living there," says Greta Vasin. "But where are we supposed to go? Here at least we still get our post." There's a toilet in the café round the corner and they can take a shower at their family's house. But the family can't really come to their aid." They've got problems of their own and no room to take us in," says Mr Vasin. The couple have been living in the car since Christmas. But is it an option to spend the rest of your life in a car? "Ah, we haven't got so many years left," says Mr Vasin bitterly.

"In this situation it would be worth considering leaving the city," says Mariana Stanciu. "It's true that living standards in Bucharest are quite a bit higher than they are in the countryside, but life can still be harder in the city. In the countryside people at least have the chance to grow their own vegetables. That's why there are initiatives to move pensioners to the countryside. It's easier for them to survive there."

Antioch woman killed by bear

Educator mauled while hiking in Romania

Posted Friday, June 29, 2007

A 30-year-old Antioch woman was mauled to death by a bear Saturday in Romania where she was working to educate people on preventing HIV and family violence.

Kathryn Irene Evans was killed while hiking with five others, including her husband, John Evans, on a remote trail in the Carpathian Mountains.

According to reports, the bear killed Evans after injuring Sara McKelvey, 26, of Frederick, Md., and a man, despite efforts by others in the group who threw stones at the bear.

The bear had earlier bitten a Romanian tourist on the shoulder and attacked sheep, one of the members of the rescue team told news television Realitatea TV.

Authorities are searching for the bear to euthanize it.

Evans was project manager for the International Orthodox Christian Charities USAID-funded project, “Strengthening Community-Based Initiatives on HIV/AIDS and Family Violence in Romania,” from April 2006 until her death.

Matt Parry, USAID director of operations, described Evans as a hard worker who understood how to easily relate to people from different cultures.

Parry said Evans was hired after an internship with the organization and became her peers’ supervisor.

“What could have been an awkward transition was seamless, which says a lot about how Katie did her job,” Parry said. “She did not preach to people or speak to them in a condescending way. She just understood and listened.”

Evans attended Grass Lake and Emmons elementary schools, and graduated Antioch Community High School in 1994.

After earning a bachelor’s degree from St. Cloud State University in St. Cloud, Minn., in 1998 and a master's degree in public health from Florida International University in North Miami, Fla., in 2006, Evans spent her career serving others.

She was a Peace Corps volunteer in Bangladesh from 2000 to 2002, where she met John Evans. They were married in 2004.

Other survivors include her mother and stepfather Judy and John Shaffer, of Lake Villa; father and stepmother Gregory and Beth LaPlante, of St. Anne.; brother Edward LaPlante of Carmel, Ind.; and sister Michelle Yearout of Kenosha, Wis.

Visitation is 4 to 8 p.m. Monday at Strang Funeral Home, 1055 Main St., Antioch. Funerals services are 11 a.m. Tuesday at St. Peter Church, 557 Lake St., Antioch.

Friday, June 29, 2007

Fabian Romania swings to FY profit; says current year outlook attractive

LONDON (Thomson Financial) - Fabian Romania Property Fund Ltd swung to a full-year pretax profit and posted a 36 pct increase in net asset value per share, and said the current year's outlook is attractive in light of the significant progress it has made on its investment pipeline.

The Romania-focused real estate fund said it committed a total 35.6 mln eur across four projects during calendar 2006, on which it raised bank debt of 18.9 mln eur, and said its share of the market value of these projects was 46.7 mln eur as at Dec 31 2006, before the deduction for financing.
At the end of June, the company said it has total capital commitments of over 70 mln eur across nine investments.

Operating revenues came in at 1.45 mln eur during the year and pretax profits for 2006 came in at 1.34 mln eur. In the period from April 20-Dec 31, 2005 the company made a pretax loss of 0.7 mln eur. NAV per share was 1.356 eur on Dec 31.

Dracula's Castle could become a Transylvanian resort

NEW YORK (Reuters) -- In the cutthroat business of real estate, U.S.-based firm Baytree Capital Associates has been chosen to market Dracula's Castle.

Archduke Dominic Habsburg, who lives in New York State, and his family retained the private investment firm to market Bran Castle and the surrounding property in the Transylvanian region of Romania.

"They're looking to flat out sell the entire project, but they are particular about who they sell it to," said Michael Gardner, Baytree chairman.

"While they are amenable to someone building a resort that continues the castle and such, they're not amenable to blood dripping on swords. This is not going to be Vampire Land."

While he would not say how much the property would go for, he suspects it would be in the nine-figure euro range. He expects to start marketing the property in about 60 days.

The castle and ancillary buildings are located on 22 acres and additional acres also may be attached to the sale. The property is about 20 minutes away from an international airport that is currently under construction and near the Brasov ski area.

The association of Bran Castle as Dracula's Castle can be traced back to Irish author Bram Stoker, who used the castle as his inspiration for the settings of his 1897 novel, Dracula. The Romanian government has about two years left to operate the castle as a museum, which hosts about 450,000 visitors a year, Gardner said.

The castle was originally built as a fortress in 1377 and was given to the Romanian royal family in 1920. The castle became a possession of the state in 1947 and was transformed into a museum in 1957. The Romanian government returned the property to the Habsburg family in 2006.

Gardner said the property will probably be marketed to private equity firms and hotel real estate investment trusts, but the buyer will probably be European.

Romanian Posts 0.16 Pct. Budget Surplus

BUCHAREST, Romania (AP) - Romania posted a budget small surplus of 0.16 of gross domestic product during the January-May 2007 period, but the government planned to increase spending to deal with a severe drought, the Finance Ministry said Thursday.

Total budget revenue through May was 47.75 billion lei (euro15 billion or US$20.2 billion), about 12.2 percent of GDP, while spending totaled 47.15 billion lei (euro14.9 or US$20.07), or 12.1 percent of GDP, the ministry said.

The government had forecast a 2.8 percent deficit for this year, but the European Union warned it could be higher, reaching 3.2 percent of GDP -- above the EU deficit limit of 3 percent of GDP.

European Commissioner for Economic and Monetary Affairs Joaquin Almunia warned Romania last month it could face disciplinary action over its deficit.

On Wednesday, Romanian Prime Minister Calin Popescu Tariceanu said the government would not be able to lower the deficit because it needed to spend on agricultural subsidies to fight the effects of drought.

The government is scheduled to hold a special budget revision meeting to allocate additional funds for agriculture, health and transportation.

Betfair taps Romania for offshore software skills

"It's not stupidly cheap but it is cost effective"...

By Andy McCue

Published: Thursday 28 June 2007

Online betting and gaming company Betfair has set up an offshore software development centre in Romania to cope with the demands of its rapidly expanding product portfolio.

Betfair opened the 50-person facility earlier this year with just eight developers. Already it is up to 35 staff and the company expects the facility to be full by September. Although the cost of the staff is around 25 to 30 per cent cheaper than in London, Betfair said the main reason for setting up in Romania was to tap into extra skills and resources.

Eachan Fletcher, director of Betfair development in Romania, said there is so much work on the company's product roadmap that decisions were having to be made on what couldn't be done.

He told "We just didn't have the capacity to deliver all of it. It makes no sense to stick another 200 developers in London. We have almost reached a critical mass. You have to attract them away from city banks and it is costly and takes a long time."

Betfair looked at various countries including China, India and the Ukraine but opted for Romania because of the high-quality skills available, its relatively untapped potential as an offshore location and its recent EU membership.

Fletcher said: "It's virgin territory we were looking for. It's not stupidly cheap but it is cost-effective. We compared lots of locations. Many were cheaper but didn't have the quality versus investment you put in."

Betfair also decided to build and run the Romanian offshore facility itself rather than outsource it to a third party - and chose to locate it in the city of Cluj-Napoca.

Romanian lawmakers pull out of Council of Europe over CIA secret prison allegations

Thursday, June 28, 2007

STRASBOURG, France: Romanian lawmakers, critical of a Swiss investigator' s report that said Bucharest hosted CIA secret prisons, pulled out of the Council of Europe's parliamentary assembly Thursday until he visits Romania to prove his claims.

Swiss Sen. Dick Marty, leading an inquiry on behalf of the human rights watchdog, said in a report earlier this month that the CIA ran secret prisons in Poland and Romania — with the knowledge of several local politicians — to interrogate key terror suspects after the Sept. 11 attacks.

The report was approved Wednesday by the parliamentary assembly, a body comprising lawmakers from the human rights watchdog's 47 member states, which meets four times a year to debate human rights issues and social and political trends in Europe.

Romanian and Polish parliamentarians sharply criticized Marty in a debate Wednesday, saying he failed to provide a single piece of hard evidence to back up his report, which was based largely on information he had gathered from unnamed CIA operatives.

"The Romanian parliament's delegation has decided to take no further part in the assembly's activities until (Dick Marty) personally visits Romania to verify the so-called information and proof forming the basis for the accusation that the country was involved in hosting secret detention centers," the 10-member delegation said in a statement.

The lawmakers said they were shocked by Marty's refusal to accept repeated invitations to visit Romania and carry out field visits at the site where media reports said the jail was located.

Marty traveled to Bucharest in 2005, at the beginning of his investigation, but turned down recent invitations by the Romanian authorities, saying he did not want to be manipulated by them. His assistant has visited Romania twice, said Mihaela Draghici, an official with the Romanian delegation to the parliamentary assembly.

Marty was asked by the Council of Europe to investigate CIA activities on the continent after media reports of secret prisons violating Europe's human rights standards emerged two years ago.

The Romanian pullout is a symbolic gesture, as the parliamentary assembly has no executive powers.

"We have cooperated with Mr. Marty's team, he received all the information he had asked for. His assistant was able to see anyone he wanted in Romania, there were no restrictions, " said Draghici, adding it was the first time a delegation has withdrawn from the assembly.

Thursday, June 28, 2007

Thunderbirds perform in Romania

The Associated Press
Posted : Thursday Jun 28, 2007 13:10:17 EDT

CONSTANTA, Romania — The Air Force fighter jet precision flying team performed Thursday at a Romanian airport near the Black Sea, with over 4,000 spectators applauding the stunts.

The show was part of festivities celebrating the U.S. Air Force’s 60th birthday, with the Thunderbirds team flying in group formation and performing aerial acts.

The Thunderbirds, based at Nellis Air Force Base, Nev., are taking part in air shows in nine European countries this year.

In Romania, the show took place at the Mihail Kogalniceanu International Airport near the Black Sea port of Constanta and located next to an air base which will be taken over later this year by the U.S.

The Thunderbirds were joined by planes belonging to the Romanian air force, which also performed aerial feats.

Monitoring of Bulgaria and Romania to continue

By Judith Crosbie
The Economist

The European Commission has warned that Bulgaria and Romania must step up efforts in the fight against corruption and has said it will continue to monitor both states until at least June next year.

But the progress reports, published yesterday (27 June), do not recommend triggering a safeguard clause, under which decisions by Bulgarian and Romanian courts would not be recognised elsewhere in the EU.

Both countries were relieved at the Commission’s decision not to recommend sanctions but were disappointed at the continuation of the monitoring. They had hoped a final report would be delivered at the end of the year.

Yesterday’s reports will be updated at the end of the year and a new report will be published in mid-2008.

The Commission criticised both states for “insufficient” efforts to tackle high-level corruption. Bulgaria has adopted a programme for addressing this problems but “it remains unclear whether measures to protect potential whistleblowers have been effectively implemented”. The report adds: “There is little evidence of rigorous and systematic judicial follow-up on allegations of high-level corruption.

Bulgaria was also criticised for lack of progress on fighting organised crime. An updated action plan on the problem has been implemented but data that would allow an assessment of how judges treat such cases is “patchy or inadequate”.

Romania has brought in a specialised prosecution service for corruption but judges have handed down several suspended sentences in high-level corruption cases. “The rationale for these suspensions…needs to be clarified,” says the report. The Commission also says it is concerned about recent events in Romania, such as the decriminalisation of bank fraud, parliament’s intention to shorten the maximum duration for investigations and the dismissal of a senior member of the corruption prosecution service.

Commission Vice-President Franco Frattini, in charge of justice, as well as Romania’s and Bulgaria’s commissioners, Leonard Orban and Meglena Kuneva, sought to tone down the report’s conclusions during discussions in the College. But the main message of the report remained the same in the report’s final version.

German MEP Elmar Brok, a member of the European Parliament’s foreign affairs committee, has requested the Commission to apply a more consistent policy to Bulgaria and Romania. Brok deplores the fact that although the Commission criticises deficits in both country’s judicial systems and the fight against corruption, “the Commission has not drawn the necessary consequences by activating the safeguard clauses provided for by the accession treaties. Instead, it has limited itself to observe both countries further until spring 2008”.

Brok, former Parliament rapporteur for enlargement, accused the Commission of succeeding “only in talking and not in acting”.

Romania sells meat processor

ROMANIA: State-owned shares in meat processing company Prelucrarea Carnii Splai up for sale.

The Romanian government is to sell off nearly three quarters of the shares in the meat processing company Prelucrarea Carnii Splai as part of a privatisation programme.

The Authority for State Assets Recovery (AVAS) has advertised the sale at a price of 1.9 million Romanian lei – approximately €598,000 - 9.25 lei per share.

The sale is expected to take place in July.

According to AVAS the Bucharest based company has a share capital of 733,627 lei.

In all just over 70 per cent of the state owned shares will be sold.

Bulgaria and Romania progess report: must do better


Bulgaria and Romania must implement reforms if they are to successfully tackle judicial reform and high-level corruption, said commission vice president Franco Frattini.

His comments follow the commission’s publication on Wednesday of two progress reports, which, despite being accused of watering down criticism of both countries, indicate that not enough has been done to eradicate high-level corruption.

“Bulgaria, has adopted important constitutional reforms,” said Frattini.

“It has largely met the benchmark, but not completely because these reforms have yet to be implemented.

As for Romania, Frattini said that he noted with “great satisfaction” that benchmarks had also been “largely met”.

A major weakness in both however was the fact that neither country has successfully tackled high-level corruption.

“Both governments are aware of this,” said Frattini.

The commission has effectively given both Bulgaria and Romania a year to clean up their act, with a progress report due to be published mid-2008.

Frattini also defended the non-confrontational nature of both reports.

“These are not monitoring reports,” said Frattini.

“These are member state countries in the post-accession phase, and the aim of these reports is to help them to deliver, to get results.

“I believe that the college that adopted these two reports was credible and able to strike a balance."

European Liberal Democrat leader Graham Watson said that the postivie nature of the reports undermine the concerns of some member states that the 2007 accession was premature.

However, EPP-ED group leader Joseph Daul warned that "becoming a member of the European Union does not mark the end of work”.

EU warns Bulgaria and Romania to do more on corruption

by Lorne Cook

The European Commission warned EU newcomers Bulgaria and Romania Wednesday to take more action to fight corruption but stopped short of imposing sanctions for their failure to meet reform targets.

The European Union's executive arm said in two reports that the Balkan states, which joined the bloc on January 1, had made progress with judicial reform but needed to do more to implement the changes.

"These efforts need to be consolidated, particularly in the area of the fight against corruption," said EU Justice Commissioner Franco Frattini.

But the commission decided against triggering the so-called "safeguard clauses" that had been put in place for the first three years of the two countries' membership because of their poor degree of readiness.

"The commission has not proposed at this stage the use of safeguard clauses as sufficient progress has been made to suggest that in time the benchmarks can be met by the Bulgarian and Romanian governments," it said in a statement.

EU countries and the commission can sanction either country for failures in their judicial systems or in the management of EU funds and food safety.

They can refuse to recognise legal decisions and can even suspend farm aid to Bulgaria and Romania.

The two countries immediately conceded that there were shortcomings and vowed to continue with, and implement, the necessary reforms.

"We share the opinions presented in the report as to the fact that there are still problems left to solve," Romanian Prime Minister Calin Tariceanu said, adding that his country would "continue eliminating the weak points".

The report on Romania said it should ensure a more transparent and efficient judicial process; establish an agency to check conflicts of interest; and take more effective action against high-level corruption.

Bulgaria was urged to adopt constitutional amendments on the independence of its justice system; continue with reforms of the judiciary; and investigate high-level local government and border corruption.

It was also told to implement a strategy to fight organised crime.

"Bulgaria received recognition that it has taken a stride forward" towards meeting reform targets, Bulgaria's Minister of European Affairs Gergana Grancharova told journalists in Sofia.

"But no particular bravery is needed to admit that we continue to have problems that we must tackle. It is a question of courage and political determination to do that as soon as possible."

Both states were requested to draw up action plans to tackle the issues.

While the two were given the benefit of the doubt because of their short time as EU members, Frattini warned that he expected to see results by the time a new full report is published in June next year.

"I would expect from now till summer 2008 (to see) Bulgaria and Romania meeting the benchmarks," he told journalists in Brussels.

A particularly worrying sign, he said, was the amount of time it took for high-level corruption cases to work through the system.

"After a suspect is brought before a court, it takes a very long time, excessive time to get the final decision," he said. "An average of three or four years, that is too much time."

But safeguard clauses should only be implemented as a last resort, he said.

"Safeguard clauses are triggered in cases of no progress made at all," he said. "Safeguard clauses should be seen as an exceptional clause. It's not normal to trigger a safeguard clause on a full member state."

The commission is due to make visits later this year to the two countries to study their progress on the use of agricultural funds and on animal health and food safety, as well as aviation safety in the case of Bulgaria.

EU officials acknowledged privately that the reports had been toned down from earlier drafts.

Frattini defends mild stance on Bulgaria and Romania

27.06.2007 - 17:44 CET | By Renata Goldirova

EUOBSERVER / BRUSSELS – The European Commission's vice-president Franco Frattini has been forced by media to defend his apparently indulgent stance on Bulgaria and Romania's poor performance in the fight against corruption, while some MEPs stressed Brussels should have triggered sanctions against the two newest EU entrants.

"It is not a blaming and shaming exercise. Our reports are honest, fair and balanced," Mr Frattini told the press room on Wednesday (27 June), as he presented six-monthly evaluations of how Sofia and Bucharest are addressing shortcomings in their judicial systems, the fight against corruption and organised crime.

The two Balkan states were admitted to the EU bloc in January 2007, but only under unprecedented conditions, including regular monitoring of all sensitive areas with the possibility to apply penalties.

At this stage, however, Sofia and Bucharest both escaped sanctions, although the reports show that progress is visible mainly only on paper while implementation remains a weak point.

But the EU's executive body doesn't speak in one voice on the issue, with the college of 27 commissioners divided into two camps - one trying to highlight positive achievements, the other favouring tougher language.

Franco Frattini (Italy), Meglena Kuneva (Bulgaria), Leonard Orban (Romania), Olli Rehn (Finland), Charlie McCreevy (Ireland) and Jan Figel (Slovakia) were among those trying to sweeten the otherwise critical reports.

Mr Frattini, who is in charge of the home affairs dossier in the commission, defended such moves by saying it was necessary to choose "proper language" and "the post-accession approach."

It would be a mistake to use, for example, the word "monitoring," as the two countries are no longer candidates for EU membership, Mr Frattini argued, asking rhetorically "what kind of message [would] we send to the Bulgarian and Romanian population [if we said] you are under scrutiny?"

MEPs reservations
But some members of the European Parliament have criticized the EU's executive arm for failing to apply a more consistent policy vis-a-vis the two newest EU states.

According to German conservative MEP Elmar Brok, the commission's inconsistent behaviour might not only damage the EU's credibility, but could also undermine reform efforts in the two countries.

"The commission has not drawn the necessary consequences by activating the safeguard clauses provided for by the accession treaties. Instead, it has limited itself to observe both countries further until spring 2008," Mr Brok said.

He added that "At this point, it would have been possible to make a symbolic sign. Unfortunately, the commission did not seize this opportunity".

But according to Mr Frattini, the safeguard measures written in the accession treaties are an exceptional and last-resort tool. Nobody in the 27-member college tabled a proposal to trigger sanctions at this stage, he says.

The reports highlight what the two governments should do as well as giving them credit for what has been achieved, Mr Frattini argued, underlining that this is the way to treat an EU member.

Daniel Mitov: Criticism for Romania is softer than that for Bulgaria

Focus News Agency

According to Daniel Mitov, Chairman of the Democracy foundation in Bulgaria, no triggering of safeguard clause is necessary, because it would be a specific message for the Bulgarian citizens, but according to him, this was the language of diplomacy, which says that problems were serious. Mitov was commenting on the report of the European Commission on the progress of Bulgaria and Romania.
‘The report on Romania is quite softer, only the problem with corruption is mentioned there’, he said and added that it was still not clear whether a safeguard on agriculture would be triggered for Bulgaria as well.

Uniqa's stake in Romania's Astra now 50 pct plus 1 shr, to make mandatory offer

VIENNA (Thomson Financial) - Austrian insurance company Uniqa Versicherungen AG said it has bought a further 23 pct in Romania's Astra and now holds 50 pct plus one share in the listed company. In accordance with Romanian law, Uniqa will make a mandatory offer to buy the remaining shares in Astra, the insurer said in a statement.

Harting opens new plant in Romania

An official opening ceremony was held recently to inaugurate the HARTING Technology Group's new plant in the Romanian city of Sibiu (formerly Hermannstadt).

Source: evertiq
The entrepreneurs Dietmar and Margrit Harting, together with the Board and representatives of company management, had traveled to Sibiu to attend the celebrations along with Romanian members of staff.

In addition to a number of invited guests representing the local authorities and the business and political communities, the event was also attended by the Mayor of Sibiu, Klaus Johannis. The Metropolitan of the Orthodox Church in Sibiu, Laurentiu Streza, blessed the new plant. Afterwards on a tour the plant, the guests were able to gain a fuller impression of the modern production facilities.

"We regard Sibiu as an important building block in the HARTING Technology Group. Thanks to the skills of our local employees, we are able to extend our capacity for labor-intensive assembly operations and at the same time safeguard jobs in Germany," explained Dietmar Harting at the opening ceremony for the new plant.

HARTING began its commitment in Romania in 2002 and meanwhile has business units in the country manufacturing industrial connectors and preformed cables for medical, telecoms and industrial applications. In addition, connector systems and magnet systems for the automotive industry as well as tool molds will now be produced in Sibiu. The new HARTING plant is located alongside other international investors in the recently developed West Park industrial zone. In the first stage of construction, the plant facilities cover an area of some 5,500 square meters.

Romania's Telemobil rated 'B-' with stable outlook on shareholder support - S&P

MUMBAI (Thomson Financial) - Standard & Poor's Ratings Services said it has assigned a 'B-' long-term corporate credit rating, with a stable outlook, to Telemobil SA.

The rating agency attributed the rating to the financial assistance that the Romanian mobile operator is getting from its shareholders well as its focus on the provision of affordable wireless data services.

S&P expects the group's liquidity to remain sufficient to fund growth over the next two years.

However, it sees Telemobil's vulnerable competitive positions, weak liquidity, and high leverage as constraints on its ratings.

S&P also assigned 'B-' senior secured debt rating and '4' recovery rating to the Romanian company's proposed 125 mln usd senior secured notes due 2014.

eBay cracks down on Romanian fraudsters

Auction site's clampdown on online fraud in Romania over the last three years has resulted in several hundred arrests

Online auction site eBay has made public the details of a three-year long campaign to curb online fraud being perpetrated by criminals in Romania — an effort that has resulted in several hundred arrests.

Matt Henley, a member of eBay's US-based Fraud Investigations Team, spoke about the campaign while taking part in a two-day workshop in Sydney with representatives of local law enforcement agencies.

Henley is currently in town to discuss the latest online fraud techniques with representatives from the Australian Federal Police, the Australian High Tech Crime Centre, the Australian Crime Commission, the Australian Communications and Media Authority and all the state and territory police forces.

The e-commerce site's internal fraud team first took note of a higher-than-usual amount of fraudulent activity from Eastern Europe in 2005.

"A huge percentage of the fraud we were seeing was from Romania," Henley said.

While schemes varied, many of these criminals committed fraud after approaching eBay users that had narrowly lost an auction.

"The fraudster can see that a user that didn't win was prepared to spend AU$145 (£61) on a particular item," Henley explained. "They would then attempt to contact the user off the eBay platform to offer them a second chance. The number one goal of these fraudsters was to pull users off of eBay — away from our security cameras so to speak."

The fraudsters would first have to guess the emails of the losing bidders — most commonly by combining their eBay username with popular webmail domains.

"It's very common that users have the same username for their eBay as their email," Henley explained. "Simply by sending out 50 emails of the most common domain names — including the eBay username — at Gmail, Hotmail, Yahoo, [they would have a certain level of success]."

The scale of the fraud was such that eBay formed a dedicated team to look into the issue — hiring a crack team of analysts and lawyers to work with victims and the Romanian authorities to come up with some solutions.

The team's initial assessment attributed the Romanian problem to two central issues — a technology knowledge gap and a lack of resources to tackle cybercrime.

"What we found is that there is a huge gap between generations in Romania," Henley said. "There are 25- to 30-year-old criminals that are among some of the brightest we've ever dealt with. But law enforcement officials and magistrates might have never even used a computer."

The eBay team first took an education role — running roadshows for law enforcers, and conducting a two-day course with the National Institute of Magistrates in Bucharest in conjunction with Visa and MasterCard.

Last year, eBay and Microsoft also sponsored a national cybercrime conference in Romania, talking about the online fraud issue with 200 law enforcement agencies.

Next, eBay attempted to address resourcing issues to fight cybercrime in Romania.

Romania tends to base its resource allocation on population, so most of its law enforcement efforts in the country had been concentrated on its capital, Bucharest.

"Whereas we found that most of the fraud is coming from towns with populations of 50,000 or 100,000," Henley said.

In some of these towns, the eBay team found backlogs of 200 eBay-related fraud cases.

"The police presence in these towns often didn't even have an internet connection," Henley said. "Some were using the same internet cafés as the criminals, which was of grave concern to us."

The Romanian police force thus became the lucky recipients of donated internet connections, computer equipment and digital cameras, courtesy of eBay.

Since the campaign began three years ago, Henley claims that eBay has helped the Romanian authorities make "several hundred arrests" related to online fraud.

"Prior to this, nobody was being arrested," he said. "At least now there is the knowledge that there is a risk associated with being involved in this fraud."

Henley is in no doubt that another country like Romania will prove attractive to online criminals, but for now is satisfied that there is no one country more problematic than another.

"The next [problematic] country will be wherever there is the same pattern — highly-trained people with little opportunities to make money legitimately," he said.

Romania: EU production base to challenge China?

Only a small percentage of the 250,000 t/y of polymer needed by Romanian plastics converters is actually produced in the country, which depends largely on imports, the newsletter Plastics Information Europe (PIE, Bad Homburg / Germany; says in a report in its current issue. The only two major Romanian polymer producers are Oltchim (Rîmnicu Vîlcea; and Rompetrol Petrochemicals (Navodari / Rumänien; Due to its low wages, the country has considerable growth potential as a European investment location that could compete with China , PIE notes.

Bulgaria and Romania 'plagued by corruption'

Source: The Independent
By Jennifer Rankin in Brussels and Claire Soares
Published: 28 June 2007

Romania and Bulgaria are fighting alarming levels of lawlessness with contract killings, criminal mafias and corruption still plaguing the eastern European members of the European Union.

That was the verdict yesterday of a six-month progress report from the European Commission, raising doubts about how qualified the two newest EU members are to belong to the continental club.

The EU singled out Bulgaria for its worryingly high number of hit-man assassinations. "Contract killings continue to be of great concern, and in particular most recent killings of local politicians since January. To date no prosecution and conviction had taken place," the report said.

Romania and Bulgaria escaped sanctions from Brussels. But they were both criticised for failing to tackle high-level corruption and enact promised judicial reforms since they joined the Union in January.

"High-level corruption is still one point of weakness and both the governments are aware of this," said Franco Frattini, the European Commission's vice-president. Too few results are shown concerning practical results ... too many indictments still need to be translated into a final decision of a court, that's why we say, very frankly, progress made in this field is still insufficient."

The final version of the reports on the two newcomers omitted a warning that there "was no room for complacency" in either country and Mr Frattini was forced to defend the report from accusations it had been watered down.

Bulgaria and Romania had been threatened with bureaucratic sanctions that would have in effect stopped them participating in joint justice and interior decisions until they had met EU standards.

Now they have until June 2008 to get their houses in order although critics doubt how much incentive there is for Sofia and Bucharest to act now they have been accepted into the EU fold.

The Bulgarian President, Georgi Parvanov, was defiant. "We are already a member of the bloc, a member who strictly and correctly implements its commitments," he told national radio, according to Reuters. "I hope Brussels will look at this behaviour of ours in a more responsible manner."

Victor Alistar, executive director at Transparency International in Romania, said the EU verdict was more positive than the reality, with less judicial progress made in either country than the reports implied. In Transparency International's world rankings, which measure perceptions of corruption, Bulgaria languishes in 57th place and Romania 84th, making it the most corrupt country in the EU.

Bulgaria has Europe's highest per-capita rate of organised crime killings, with some 150 people murdered in connection with organised crime between 2000 and 2006.

As if to emphasise the scale of the corruption plaguing Sofia, the country's top investigator resigned yesterday following a corruption scandal which allegedly involved the energy minister, blackmail and embezzlement.

Prosecutors have said that they lack the evidence to bring charges but are still investigating whether there has been an obstruction of justice.

And things are no better across the border in Romania. The former prime minister Adrian Nastase is accused of blackmail and taking bribes worth millions of euros although he denies all accusations.

With hearings suspended for three months on Monday, the EU report specifically questioned the willingness of the judiciary to prosecute cases into former politicians that are currently in limbo.

Marty slams "wall of silence" over CIA jails

Source: swissinfo

A Swiss investigator says European governments have built "a wall of silence" against charges that they colluded in a secret CIA prison network for terror suspects.

In a report earlier this month Senator Dick Marty said the CIA ran secret jails in Poland and Romania to interrogate key terror suspects after the 2001 attacks on the United States.

The report – the former prosecutor's second into the affair – was approved on Wednesday by the parliamentary assembly of the Strasbourg-based Council of Europe, a human rights watchdog.

"There has been a wall of silence on the part of the governments, silence that covers illegal acts, human rights violations," Marty told the assembly, which asked him to investigate CIA activities in Europe after media reports of secret prisons emerged in 2005.

People were "spirited away without any judicial control... and that was also the case in Europe", he added.

His report, citing unidentified CIA sources and other contacts, said that "high value detainees" such as self-proclaimed 9/11 mastermind Khalid Sheikh Mohammed and suspected senior al-Qaeda operative Abu Zubaydah were held in Poland. It said lesser detainees, who were still of "remarkable importance", were taken to Romania.

Marty accused the former Polish president, Aleksander Kwasniewski, and the current and former presidents of Romania, Ion Iliescu and Traian Basescu, of having known and approved of the secret CIA operations on their soil.

The Swiss senator added that Germany and Italy had used "state secrecy" to obstruct investigations.

Poland and Romania have vehemently denied the allegations of housing secret prisons, and most of the other EU countries mentioned in Marty's reports have denied any wrongdoing.

"It is a far-fetched conspiracy theory spiced up with a generous helping of anti-Americanism," Polish senator Urszula Gacek told the assembly, describing the report as a "piece of fiction".

Romanian socialist Vasile Ungureanu said the report was "like a film scenario" and called for it to be rejected.

Initial findings

Marty stated in his preliminary report last year that 20 mostly European countries colluded in a global "spider's web" of secret CIA jails and flight transfers of terrorist suspects stretching from Asia to Guantanamo Bay.

EU justice commissioner Franco Frattini has complained Marty's second report only quotes anonymous witnesses and does not name any sources.

But Marty defended the use of anonymous witnesses saying his sources needed to be protected because they would face charges of high treason in their countries if their identity were revealed.

Over 30 serving and former members of intelligence services in the US and Europe are said to have been interviewed.

Switzerland also reportedly knew of the secret prisons. A Swiss newspaper revealed that in late 2005 the country's intelligence services intercepted a fax from Egypt claiming that the US was operating a secret prison in Romania.

Earlier this year the cabinet authorised plans to launch criminal proceedings over a suspected CIA flight that took a Muslim preacher kidnapped in Italy across Swiss airspace.


The 14 European countries implicated in Marty's preliminary report for colluding with the CIA extraordinary renditions programme, allowing undeclared flights or failing to investigate kidnappings of their citizens or residents: Austria, Belgium, Britain, Cyprus, Denmark, Germany, Greece, Ireland, Italy, Poland, Portugal, Romania, Spain and Sweden.


Dick Marty, a Swiss senator, was appointed by the Council of Europe in November 2005 to investigate claims that the CIA had set up secret prisons in eastern Europe.

In his initial report published in June 2006 he concluded that 14 European countries had colluded with the US in a "spider's web" of human rights abuses.

Marty, who is chairman of the council's Committee on Legal Affairs and Human Rights, said other countries, including Switzerland, had been involved actively or passively in the detention or transfer of unknown persons.

President George W Bush acknowledged the existence of a secret detention program in September, but did not say where the prisons were located.


Romanian hacker charged with breaching NASA computers

BUCHAREST (AFP) - A young Romanian has been charged with hacking into NASA computers and causing more than 1.5 million dollars (1.1 million euros) of damage for the US space agency, prosecutors said Tuesday.

Victor Faur, 26, from the western town of Arad, was also accused of breaking into the computers of the US navy and the Department of Energy between November 2005 and September 2006, a statement said.

Romanian police alerted NASA in July last year that its servers had been breached by unknown people based in Romania.

An ensuing probe, launched jointly by Romanian police and the FBI, led to Faur.

NASA had to rebuild its systems and scientists and engineers had to manually communicate with spacecraft, resulting in huge losses for NASA.

Faur, meanwhile, said in television interviews that his action was aimed at "proving that several computers are vulnerable to attack," and underlined that he had not tried to make any "material gains."

"I had neither modified nor erased the files, nor destroyed the communications systems," said Faur, who was formally put under investigation in December and has been barred from leaving the country.

An earlier indictment by the US Attorney's Office charges Faur with leading a hacking group called the "WhiteHat Team," which broke into the systems because of their reputation of being among the most secure in the world.

Wednesday, June 27, 2007

EU raps Bulgaria and Romania for corruption

June 27, 2007

Bulgaria and Romania were warned today that they have failed to do enough to tackle high-level corruption and contract killings, but that they would be spared sanctions for the time being.

In a six-monthly progress report, the European Commission told the two new EU member states that there was no room for complacency, despite some progress in remedying weaknesses on justice and home affairs.

Franco Frattini, the EU Justice and Home Affairs Commissioner, said that to meet EU rules in the field the two countries needed to step up their battle against corruption, and work to overcome the backlog of cases waiting to go to court.

"High-level corruption is still one point of weakness, both governments are aware of this," Mr Frattini told reporters, after the Commission voted to adopt reports on the two EU members.

"Too few results are shown concerning practical results ... too many indictments still need to be translated into a final decision of a court, that’s why we say very frankly progress made in this field is still insufficient," added Mr Frattini.

Concern over corruption and organized crime has led the EU to insist on a long period of monitoring the progress of the two countries, which joined the EU in January. Both countries must report to the EU every six months on progress in reforms to curb corruption and streamline their judiciaries, or risk losing a chunk of economic aid.

In today's report - the first - the Commission said it was too early either to decide on possible sanctions or to remove that threat for the two states.

It had threatened to invoke so-called safeguard clauses under their membership treaties, which would have suspended the two Black Sea neighbours from participation in EU justice and interior policies until they met EU standards and norms in the area.

Mr Frattini warned them that the threat of such a sanction would be extended until June 2008, when another report card is to be issued on their reforms.

The threat is meant to put extra pressure on the two countries to redouble efforts to overhaul their judicial systems.

Romania was credited with progress in judicial reform and substantial progress in creating a National Integrity Agency.

Recently Romania has started to take action against corruption among political leaders. In May, the former Romanian Prime Minister Adrian Nastase was charged over allegations he used his office to end a probe into his bank accounts over claims he accepted just over a million euros in bribes.

But in both countries “progress in the judicial treatment of high-level corruption is insufficient”, the reports said.

In Bulgaria, an unfolding corruption scandal has implicated the economy minister and the government’s chief investigator.

Bulgaria was criticised in the report for failing to achieve enough across the whole area of crime-fighting. Between 2001 and 2006, more than 150 people were gunned down in broad daylight in the capital, Sofia, including Bulgaria’s top banker, a football company boss and one of its top importers. No-one has been jailed.

“Contract killings continue to be of great concern, and in particular most recent killings of local politicians since January," said the report. "To date no prosecution and conviction has taken place.”

The Commission said that Bulgaria had met one key benchmark by passing a constitutional amendment establishing the independence and accountability of the judiciary.

It had also made some progress towards transparency in its judicial process, improving the professionalism and efficiency of judges. However, the overall picture was unsatisfactory.

The EU executive is also due to report separately later this year on the two states' ability to administer and absorb regional aid and agricultural subsidies, which may lead to a partial withholding of some money from Brussels, EU officials say.

EU Commission Criticizes Bulgaria, Romania

June 27, 2007 (RFE/RL) -- European Union newcomers Bulgaria and Romania got some tough criticism today from the European Commission.

The EU's executive body told the Balkan states that they have made insufficient progress in fighting corruption -- and that they risk sanctions in the future if they do not meet detailed benchmarks.

"High-level corruption is still one point of weakness. Both the governments are aware of this," European Commission Vice President Franco Frattini told a news conference in Brussels.

Earlier, the commission issued its six-month survey on the Balkan newcomers in meeting benchmarks on judicial reform, corruption, and organized crime under their EU accession treaty.

"Our aim is to help Romania and Bulgaria to deliver, to get results, not [to] point fingers or accusing or blaming," Frattini added.

'No Room For Complacency'

Nonetheless, there was plenty of blame for both countries, even if Frattini credited each with "good-will and determination."

The survey by the European Commission warned them that there is no room for complacency despite some progress they have made in remedying weaknesses on justice and home affairs.

However, the commission said it was too early either to decide on possible sanctions, or to remove that threat. Both countries joined the bloc in January.

The report saw corruption as a key problem that continues to plague both countries. It noted that, "Contract killings continue to be of great concern, and in particular most recent killings of local politicians since January. To date no prosecution and conviction has taken place."

Sofia was seen as meeting only one key benchmark. It passed a constitutional amendment to establish an independent and accountability judiciary. Bulgaria also made some progress toward transparency in its judicial process, improving the professionalism and efficiency of judges.

Reason For Optimism?

Frattini said that while the overall picture remains unsatisfactory, there is reason for optimism. He said their "good-will and determination" are the "concrete elements that are necessary to get results. That's why I can say both [countries] deserve our confidence. We trust Bulgarian and Romania not only because they are EU member states, but because they are cooperating with the verification and cooperation mechanism."

Romania and Bulgaria have another chance to impress -- or disappoint -- later this year, when the EU executive is due to report again on their ability to administer and absorb regional EU aid and agricultural subsidies.

EU officials say that if things don't improve by then, they might have to withhold some money from Brussels.

FT: Bulgaria and Romania warned on corruption

By George Parker in Brussels, Christopher Condon in Budapest and Theodor Troev in Sofia

Published: June 27 2007 14:24

Bulgaria and Romania were on Wednesday warned by Brussels to step up their fight against corruption, but a critical report was watered down in an attempt to shore up reformers in the two countries.

The European Commission on Wednesday reported that the two new EU members have failed to crackdown on serious corruption. In the case of Bulgaria there was “insufficient” progress of tackling organised crime.

But Brussels backed away from the use of sanctions against the Balkan countries, and gave the two countries another year to meet the basic membership rules of the Union. In the meantime hundreds of millions of euros of EU farm and regional aid will flow into the region.

The language in the Commission’s draft report was toned down this week after a rearguard action by Franco Frattini, EU justice commissioner and the Bulgarian and Romanian commissioners - Meglena Kuneva and Leonard Orban respectively.

They argued that a highly critical assessment would undermine reformers in the two countries, who are faced with unstable coalitions and deeply ingrained graft at the highest political level.

One Commission official admitted it would also be hard to explain why Brussels had not implemented sanctions - notably the non-recognition of court rulings in the two countries - if it produced a scathing report.

Mr Frattini was despatched to explain the diluted report to the media, insisting it was “credible and balanced”, telling the truth about the lack of progress in fighting serious crime but giving praise where appropriate.

“Our responsibility is to have a political discussion,” he said. “We have to evaluate the factual results and strike the right balance.”

He said sanctions would only be applied “in exceptional cases” but said he expected both countries to have seen through necessary reforms by the summer of 2008.

But his generally upbeat assessment surprised some observers, notably his assertion that “a lot of concrete results have been delivered” including the bringing of suspects on high level corruption charges before the court.

When challenged by a Bulgarian journalist whether he could name any such case in her country, Mr Frattini was unable to answer.

Mr Frattini was accused in April by ambassadors from Britain, France and Sweden of being too close to the governments of Romania and Bulgaria, including spending the weekend on the ski slopes with the Bulgarian interior minister.

The Italian commissioner strongly denies the allegations and says the ski trip was a working visit.

Supporters of future EU enlargement fear the slow reforms in Bulgaria and Romania could harm the club’s expansion deeper into the Balkans.

Meanwhile EU cash intended to boost Bulgarian and Romanian development could end up in the pockets of bent politicians and criminals, as happened in southern Italy.

Additional reporting by Hugh Williamson in Berlin

Romania a global hotspot for eBay fraud


eBay has taken the extraordinary step of calling a press conference in Australia to discuss the problem posed by Romanian fraudsters. eBay said it was shocked to discover that many Romanian police stations, prosecutors and magistrates had never used a computer. This lack of access to cyber crime fighting tools was allowing internet crime to go unchecked.

The company found law enforcement agencies had been trying to investigate online fraud at the same internet cafes being used by the fraudsters, "which was a huge concern to us", said Mat Henley, of the eBay global fraud investigation team. Although eBay does not have a Romanian office, the problem was so large for eBay and other companies like Visa and Mastercard, that the company has since established a dedicated fraud team in Romania.

"We discovered that Romania had a huge technology gap between generations," said Henley. "It was enormous: 25-30 year old criminals were some of the brightest people we’ve dealt with, but when you mix in the prosecutors, law enforcement and magistrates, some of them had never been on a computer - period," he said. eBay was forced to purchase computers and internet access for Romanian law enforcement agencies and train them on prosecuting internet fraud. The company also supplied digital cameras so agencies could more easily collaborate on photos of the scammers. Incredibly, eBay even involved the US Secret Service (which plays a dual role alongside protecting the President in investigating US treasury fraud).

The USSS provided intelligence from agents in Romania who were able to help Romanian law enforcement unpick the criminal internet fraud networks.

According to Henley, the Romanian scammers' preferred mode of operation is to try to lure people off the eBay site to complete transactions outside of eBay's framework. "They do a very specific attack, and they've gotten really good at it as we've tightened our platform: their number one goal is to pull users off eBay. "If an auction goes through all the way, they will not touch that auction. They know that we have all the details of that auction. They want to pull them away from our security cameras. "They're also kind of famous for the second-chance offer scams - those are 100% off the site. They look at people who bid on auctions but didn't win the item; they know that for example, eBay user Banana123 is interested in an item and willing to pay $140 for it." "Then they'll start trying to blindly guess the person's email address -,, for example. That's where we have to work with Romanian law enforcement - it's entirely off the eBay system. They're just using eBay to find and target users," Henley said. eBay has since implemented a system whereby once bids for an item reach over $AU200, the bidders' names are concealed.

According to Henley, the Romanian scammers had concocted elaborate stories to convince their victims to send money via unrecoverable methods such as Western Union - even though Western Union asks every customer as a matter of policy whether the payment is for an eBay auction, and advises of the risk. "Romanian fraudsters will ask for certain payment methods – generally they aren’t PayPal or credit card. Generally it’ll be Western Union. They tailor their scam to instruct people not to be honest with Western Union that the payment is for an eBay transaction - they'll claim Western Union will charge them an eBay surcharge of 10% more, so they just say they're sending money to their Romanian cousin," Henley said.

The auction house has recently removed the administration fees involved in making claims through the PayPal buyer protection program, meaning that shoppers are covered against fraud even for smaller purchases. However, eBay also admitted it has simultaneously cancelled the eBay buyer protection program, meaning that shoppers are only protected against fraud if they pay through PayPal. eBay's Henley said "hundreds" of internet fraudsters had been arrested since the company had put its operation into play with Romanian law enforcement.

Though he repeatedly refused to provide any firm numbers on the actual impact on internet fraud, eBay Australia Trust and Safety Director Alastair MacGibbon said that overall fraud on eBay was now less than the "one hundredth of one per cent" figure the company used to tout frequently. The company now uses a large number of proactive measures to try to honeypot scammers, and is "constantly watching for the next Romania," according to Henley.

AP: Govt's condemned over prison accusations

STRASBOURG, France — European governments have built "a wall of silence" around accusations that they let the CIA abduct their residents and run clandestine prisons on their territory, a European investigator said Wednesday.

Swiss Sen. Dick Marty charged in a report earlier this month that the CIA ran secret jails in Poland and Romania — with the knowledge of several local politicians — to interrogate key terror suspects after the 2001 terrorist attacks on the United States.

"There has been a wall of silence on the part of the governments, silence that covers illegal acts, human rights violations. Why this silence, why this systematic refusal to respond to our questions?" Marty told the Council of Europe's parliamentary assembly, which asked him to investigate CIA activities in Europe after media reports of secret prisons emerged in 2005.

Poland and Romania have vehemently denied the allegations, and most of the other EU countries mentioned by Marty have denied any wrongdoing. EU Justice Commissioner Franco Frattini has complained Marty's report only quotes anonymous witnesses and does not name any sources.

His report, citing unidentified CIA sources, said that "high value detainees" such as self-proclaimed 9/11 mastermind Khalid Sheikh Mohammed and suspected senior al-Qaida operative Abu Zubaydah were held in Poland. It said lesser detainees, who were still of "remarkable importance," were taken to Romania.

In an earlier report, Marty accused 14 European nations of colluding with U.S. intelligence in a web of rights abuses to help the CIA spirit terror suspects to illegal detention facilities.

President Bush acknowledged the existence of a secret detention program last September, but did not say where the prisons were located.

Marty's latest report, which did not give specific locations for the alleged jails, provided graphic descriptions of conditions. It told of prisoners being kept naked for weeks, and said masked guards who never spoke were the only contact for those consigned to four-month isolation regimes.

Polish lawmaker Urzsula Gacek, from the opposition Civic Platform, called Marty's report a "piece of fiction, a gripping political thriller which fails to provide a single piece of evidence."


Source: Sofia Echo

Military training Danube Guard 07 participants demonstrated the opportunities for co-operation in the fight against terrorism between Bulgaria, Romania and Serbia.

Six border cutters of which four Bulgarian and two Romanian, two helicopters and one ship took part in the first phase of the training close to the Bulgarian village of Vruv, Bulgarian news agency BTA reported.

The presidents of the three countries observed the training.

The first phase of the training simulated actions in case of vessel kidnapping. The participants had to neutralise the terrorists and free the hostages.

The second part of the training will take part in Timok River with the participation of Bulgarian and Serbian soldiers. The third part will be at the territory of Danube's pass Zhelezni Vrata 2 and will involve Romanian-Serbian actions.

EU Says Romania, Bulgaria Fail to Tackle Graft, Crime

By Adam Brown

June 27 (Bloomberg) -- The European Commission said Bulgaria and Romania must intensify their fight against corruption and organized crime or face curbs on their rights as members of the European Union.

The Balkan nations, the poorest and newest members of the EU, have passed laws to combat crime and graft in the past six months and must now ensure they are enforced, the commission said in a report released today.

``High-level corruption is still one point of weakness,'' Franco Frattini, the EU justice commissioner, told a news conference today in Brussels. ``We have to be honest, we have to be transparent, we have to stress also areas where progress still has to be made.''

Romania and Bulgaria joined the EU on Jan. 1, extending the union's borders to the Black Sea, after the commission decided the countries had upgraded regulatory standards enough to avert a one-year delay in membership. A lack of progress in the new member states may raise concern about EU entry bids of other countries in southeast Europe, including Croatia, which also face calls to fight crime and corruption.

During membership talks with Romania and Bulgaria, the commission repeatedly warned Romania to better fight corruption and told Bulgaria to intensify its fight against organized crime and contract killings.

New Report

Frattini said the commission will issue a new report on Bulgaria and Romania in 12 months. In the meantime, the EU will monitor the nations' steps toward fighting corruption and organized crime and improving the safety of food supplies and airlines.

``I would expect Romania and Bulgaria to meet the benchmarks'' by June 2008, Frattini said. ``They have adopted the laws necessary to get results. Now the focus is on implementation.''

Romania is rated by independent monitor Transparency International as the most corrupt nation in the EU, while Bulgaria has seen a continuation of contract killings since it joined the union.

In Romania, two former cabinet ministers and an ex-prime minister are under investigation on allegations of corruption, which they deny. Parliament also passed in May a new law creating an agency with the power to verify public officials' declarations of assets.

Lawmakers in Bulgaria, with Europe's highest per-capita rate of organized-crime killings, passed constitutional amendments in February meant to increase the independence of the judiciary and enable it to fight organized crime better.

`Real Test'

The Romanian and Bulgarian governments have ``prepared the necessary draft laws, action plans and programs,'' the commission said. ``However, the real test can only be met through determined implementation of these into action on the ground every day. There is still a clear weakness in translating these intentions into results.''

The report also set four goals, or benchmarks, for each country, to be reviewed in its report in a year. Bulgaria must further increase independence, professionalism and transparency of its justice system and conduct ``professional, non-partisan investigations into allegations of high-level corruption,'' according to the report.

Romania has to increase accountability of public officials and judges, further investigate allegations of corruption against senior officials and improve efforts to fight graft in regional and municipal governments, the commission said.

Airline Safety

In the report, the commission said Bulgaria must also improve airline safety. The nation's carriers have been treated as non-EU airlines since the country joined the EU and Bulgaria was ``capable of applying neither community nor Joint Aviation Authority rules on the safety of aeronautical products and maintenance.''

The commission also called on Romania to improve food safety and animal disease-prevention and restricted the country from trading horses with other EU members.

``In the meat, fish and milk sectors, transitional measures have been granted to a large number of establishments and they are allowed to market only on the national market in Romania,'' the commission said.

Romania stands to receive as much as 32 billion euros ($43 billion) in EU funds through 2013, while Bulgaria, with a smaller population, can receive as much as 11 billion euros. The per-capita gross domestic product of the two countries is about a third of the EU average.

The entry of Bulgaria and Romania marked the EU's second expansion into the former Soviet bloc to establish market-based rules for industries ranging from energy and transport to telecommunications and banking. Ten countries, including Poland and seven other nations in formerly communist eastern Europe, joined in May 2004 and swelled the bloc's population to about 460 million.

To contact the reporter on this story: Adam Brown in Bucharest at .