April 2007

Environment is one of the areas where new EU member countries faced dramatic challenges to catch up with European standards. It is also one of the areas where one can clearly see what a difference the accession process makes to key policy areas.

The challenge

The situation in the environment sector in 1997 in Bulgaria was truly disastrous. From communist times, Bulgaria had inherited low efficiency use of energy and raw materials as well as outdated and highly polluting technology. In 1992 an environmental strategy was drawn up with help of the World Bank, and some basic legislation was put in place, but – as an OECD study noted in 1996:

"implementation of environmental policy and investments for environmental improvement have not followed. Development of the regulatory framework has been delayed by a slow legislative process. Mobilising resources from enterprises, government and households is proving difficult in view of economic constraints. Pollution loads to air and water have been reduced, but mainly because of declines in production; a resumption of economic growth could increase pressures on the environment."* OECD, Environmental Performance Reviews – Bulgaria, OECD, 1996, conclusions and recommendations.

The EC's avis on Bulgaria from 1997 stated:

"Local air quality poses significant risks to human health. Waste is an area of major concern: waste management practices are elementary, especially for disposal activities, and incineration is not regulated. Soil pollution and erosion are also serious."* EC, Commission Opinion on Bulgaria’s Application for Membership of the European Union, 15 July 1997, p. 94.

In certain areas, there was no legislation at all. In the chemical sector, for example, there were some standards on safety and working conditions, but no environmental standards.* ESI interview with Eulina Milova, head of the European Integration Department in the Ministry for Environment and Water, 20 October 2006. In other areas, "a key challenge is to reform a system of very strict but unenforced standards, dating from previous decades, into realistic standards (…) Enforcement mechanisms are weak, largely limited to low fines on air, water and soil pollution".* OECD, Environmental Performance Reviews – Bulgaria, OECD, 1996, conclusions and recommendations.  There was no coherent system for licensing big industrial plants with regard to environmental standards. 39 percent of Bulgaria's waste water was discharged untreated.* Ministry of Environment and Water, National Strategy – Environment Sector, October 2000, p. 9.

Moreover, with a few exceptions, none of the Bulgarian landfills met EU criteria.* Ministry of Environment and Water, National Strategy – Environment Sector, October 2000, p. 24. At the end of the 1990s, "the present levels of environmental expenditures do not cover all waste management costs in order to guarantee protection of the human health and the environment (…) The efficiency of the control structures, information gathering and planning capacities are insufficient, especially at municipal level."* Ministry of Environment and Water, National Strategy – Environment Sector, October 2000, pp. 25-6.

"Around 77% of the total amount of treated hazardous waste is disposed of in own landfills on site of the enterprises. These landfills have exhausted their capacity and do not comply with the requirements of the present national legislation."* Ministry of Environment and Water, National Strategy – Environment Sector, October 2000, p. 25.

Two actors were in charge of environmental policies in 1997: the Ministry of Environment and Water, which included a "National Environment Protection Fund", and the municipalities.* Ministry of Environment and Water, National Strategy – Environment Sector, October 2000, pp. 13-15. Their capacities to address the huge challenges were extremely low – the combined spending of the ministry and the fund on environmental investment projects in 1997 amounted to not more than € 4.5 million.* Ministry of Environment and Water, National Strategy – Environment Sector, October 2000, p. 26.

Imagine the task in 1997: To move from the situation described above to EU compliance was a seemingly impossible mission. EU legislation in the environment sector comprises over 200 legal acts covering horizontal legislation, water and air pollution, management of waste and chemicals, biotechnology, nature protection, industrial pollution and risk management, noise and radiation protection.* EC, Bulgaria – 2005 Comprehensive Monitoring Report, 25 October 2005, p. 59. But the transposition of EU legislation would only be a first step. A whole set of new institutions needed to be created and existing ones considerably strengthened in order to be able to implement new laws and policies. Hundreds of staff would need to be trained. Co-ordination between involved institutions would need to be enhanced. The relationship between the public sector and the public, in particular companies and NGOs, would need to change considerably. The public sector would need to programme and spend huge amounts of money on environmental investments in order to achieve EU standards. In 1997 the EC initially estimated the total financial costs for the implementation of the environmental acquis in Bulgaria at € 15 billion, a figure lowered to € 8.6 billion in 2001.* Source for both figures: EC, Communication from the Commission: The Challenge of Environmental Financing in the Candidate Countries, 2001, quoted in: ECOTEC, The benefits of compliance with the environmental acquis for the candidate countries, July 2001, p. 15.

Spending such an amount was a huge challenge, for a series of reasons: First because of the sheer size of the investments. How can a ministry develop the capacity to plan projects for hundreds of millions, even billions of Euros, when in 1997 – together with the National Environment Protection Fund – it spent not more than € 4.5 million?  Second, from 2000 on, any EU-supported environmental project implemented in Bulgaria had to comply with strict EU standards. Each had to include a feasibility study, an environmental impact assessment, involve public consultation and follow EU tender, contracting and accounting rules.

Meeting environmental standards and spending money according to EU rules required thousands of new experts who still needed to be trained. It affected directly tens of thousands of people in ministries, governmental agencies, regional and municipal bodies, NGOs and thousands of companies.

Even assuming determined political will, this was still a huge challenge.

EU assistance

The EU offered a lot of assistance. First, it provided a lot of guidance how Bulgaria's legislation needed to be changed in order to meet EU standards and what kind of institutions were needed for implementation. In an exercise called "screening" EC and Bulgarian experts looked together at Bulgarian environmental legislation and institutions, analysing what was compatible with EU legislation and what was not. This was done already in 1998, after Bulgaria had become a candidate, and then again before actual negotiations on the environment chapter started. It was a sort of x-ray of what the situation in Bulgaria was and what the EU expected in this area.

There were two other key documents giving overall guidance: In 1998 the first Accession Partnership with Bulgaria was signed. This document, prepared and regularly up-dated by the EU, "would be the key feature of the enhanced pre-accession strategy".* Accession Partnership with Bulgaria, 1999, p. 2. It set out the priority areas for further work as identified by the European Commission, from the political and economic criteria to specific areas such as agriculture, internal market, energy, economic and social cohesion, and environment. It also outlined the use of available assistance from the EU.

The second document, prepared by the accession countries, was the National Programme for the Adoption of the Aquis (NPAA). It consisted in essence of a huge excel sheet, putting at every EU legislation the respective Bulgarian legal act through which it was to be implemented, giving a defined time-frame, identifying resources and the government institution responsible for it.

In addition to these general documents, there was substantive guidance from the EU's side with regard to the environmental sector. At the end of 1999, a draft version of the Handbook on the Implementation of EC Environment Legislation was made available to the accession countries. This huge document of 742 pages, provides overviews of all important sectors such as air quality, waste management, water protection and industrial pollution control and risk management, followed by detailed sections ("fiches") on all relevant directives and regulations. Separate sections were provided for 61 directives, 14 regulations and 3 decisions.* EC, Handbook for Implementation of EU Environmental Legislation, Draft November 1999, Introduction, p. 3.

In May 2000 followed a document titled Main administrative structures required for implementing the acquis, an informal working document by the EC, followed later by up-dated versions. It is very concise (some 90 pages), explaining the institutional setting required for the implementation of EU legislation in each chapter. It remained an unofficial paper, reflecting the reluctance of the Commission to define specific administrative models in areas where member states administrations were so diverse.* See Heather Grabbe, The EU's Transformative Power. Europeanization Through Conditionality in Central and Eastern Europe, Palgrave, 2006, p. 79.

Clear and ambitious commitments were necessary to advance in the negotiations and eventually close the chapter. This set a very ambitious reform agenda.

Second, the EU also provided a lot of technical assistance to help build up required institutional capacity. A total of 22 projects (or sub-projects) between 1998 and 2005 ranged from general support (development of strategies, plans, transposition of legislation) and the strengthening of individual parts of the administration to implementing specific directives and to the training of officials at regional and local levels (see annex for complete list).

Most of these projects included "twinnings", where the Bulgarian authorities would engage EU member state governmental institutions to provide long-term assistance on a specific task of institutional reform. Twinnings involved the permanent presence of a "resident twinning adviser" in the Bulgarian beneficiary institution for the whole project period, usually between 12 and 24 months. In addition, short- and mid-term experts would be brought in. It is important to note that while financed through Phare, it was the Bulgarian authorities who had the final say in choosing – after an open tender procedure where EU member state government institutions could apply – the EU partner agencies. Often twinnings were accompanied by some Phare investment funds for necessary equipment.

Table: Phare projects in the environment sector 1998-2006


Institution Building



Dom. Co-fin.




































































Third, and most important, was the EU's assistance budget for investments in the environmental area. This was central to the member state building effort. While huge sums were put on the table, they could only be spent as institutional capacity was being built up.

Starting from 2000, the accession countries benefited from the Instrument for Structural Policies for Pre-accession (ISPA), a specially developed programme oriented at the EU structural funds. It was made available for environment and transport sector projects in the accession countries.

In the year 2000, ISPA funds for the environment in Bulgaria amounted to € 52 million. In the same year funds from the national budget and the National Environment Protection Fund amounted to € 32.5 million. Municipalities contributed € 4.2 million.* Ministry of Environment and Water, National Strategy – Environment Sector, October 2000, p. 28. Compared to 1997, considerably more national funds were spent on environment, triggered by the requirement for domestic co-financing of EU projects and the need to improve infrastructure in order to meet EU requirements.

This was a lot of financial assistance, but in order to spend it a lot of preconditions had to be met. Every environment investment project, which involved any ISPA funding, had to comply with very strict standards. A national environmental strategy had to be developed before any funds could flow, analysing the situation and defining priorities. This strategy had also to be co-ordinated with other planning documents such as the Accession Partnership and the National Development Plan.

Project applications usually consisted of a file of 10-15 cm, including an application form, a description of the project, a feasibility study, a cost-benefit analysis, a timetable, a preliminary environmental impact assessment, a financial plan, and annexes with mostly technical data, all in English language.

A "EU Funds for Environment" directorate was set up in the ministry and grew to 35 people by 2005, many of them engineers in charge for the preparation and implementation of ISPA projects (in addition, some projects were implemented by the Ministry of Regional Development and Public Works).

Given that project costs were never below € 10 million and could go up to more than 40 million, preparation took from several months to up to two years, depending on the size of the project. Capacity to deal with such projects had to be built up and in numerous instances the EC returned project applications for improvements if they did not meet required standards. Once the EC approved a project an equally comprehensive tender documentation had to be prepared, before tender procedures and after selection actual construction could begin. To follow and oversee this process, a set of monitoring and evaluation bodies had to be established, which also needed to make information publicly accessible.

From the inception of a project it often took three to four years before construction began. The EC's 2004 ISPA report notes with regard to Bulgaria:

"Up to the end of 2004, total payments of ISPA grants in favour of projects amounted to €102 million, representing 18% of committed funds. The relatively modest rate of payment reflects the slow implementation of projects, and some difficulties in complying with conditions in the financing memoranda. However, the payment rate is expected to accelerate in 2005 as more projects reach the contracting stage."* EC, Commission Staff Working Document – Annex to the Report from the Commission. Annual Report of the Instrument for Structural Policy for Pre-Accession (ISPA) 2004, 1 December 2005, p. 36.

All acceding countries had problems with ISPA due to cumbersome and time-consuming procedures. Although most were more efficient than Bulgaria, crucial learning process, building up capacity, starting from a very low level.

Throughout whole 7 year period, 2000-2006, the EU invested more in the environmental sector than all Bulgarian institutions put together. From 2000 to November 2006, 22 environmental projects with a total value € 583 million were agreed, out of which the EC offered € 411 million through ISPA. The remainder was financed by Bulgaria (€ 109 million) and IFIs (€ 62 million).* Ministry of Finance of Bulgaria, Financial Implementation of ISPA, National Funds Directorate, 30 November 2006. In addition, ISPA projects in the transport sectors for the same period amounted to a total value of € 913 million, out of which € 441 million would be financed by EC ISPA funds.

Of the total amount, by August 2007 € 229 million or 39 percent have been contracted and € 80 million spent so far.* Source: Bulgarian Ministry of Finance, own calculation.

All this together, the guidance for legislative changes, the support to build up new and strengthen existing institutions and the funds made available for the environment sector, was crucial in bringing about intrinsic transformation. It clearly defies the argument that institutional capacities have to be built up before member state building can begin. Capacities are not a precondition for member state building, but the building up of capacities is the key features of member state building. In order to produce the impressive results that Bulgaria has achieved, all three components are needed at the same time.


While the whole process starts with assessments (screening), the explicit assessments of progress remains crucial throughout the whole process.

Regular reports assessed every year, starting in 1998, how much the legislative and institutional situation has improved. The 2005 Comprehensive Monitoring report, for example, notes in one section:

"As regards waste management, legislation is basically in place and is in line with the acquis, except for the acquis on polychlorinated biphenyls, polychlorinated terphenyls and waste oils. Draft legislation has been prepared but not yet adopted. Concerning batteries, the legal basis for transposing the acquis has been adopted recently. Administrative capacities are in place. However, substantial attention still needs to be paid to recruiting additional specially trained human resources (…)."* EC, Bulgaria – 2005 Comprehensive Monitoring Report, 25 October 2005, pp.59-60.

The chapter on environment of the regular report deals with all major areas, from horizontal legislation (for example how environmental impact assessments had to be done) and air quality, water quality, nature protection, industrial pollution, chemicals and genetically modified organisms and noise to nuclear safety and radiation protection.

It is misleading to think of this process as one of involving only a handful of Bulgarians in the Ministry and people in Brussels, negotiating. From the outset, hundreds of people, then thousands, were involved, including the regional inspectorates of the ministry as well as many other administrative bodies such as the veterinary service and laboratories, and 262 municipalities; the staff of the 49 modern water supply and sewage companies (of which 29 cover more than one municipality)* Government of Bulgaria, Operational Programme Environment 2007-2013, Sofia, draft May 2006, p. 11., 67 waste water treatment plants, the remaining waste companies and landfills, as well as the power plants; thousands of companies touched by the new legislation – besides the 230 companies needing a permit in accordance with the "Integrated Pollution Prevention and Control" directive, also many smaller companies that are touched by industrial waste policy, packaging waste and recycling requirements.

What has been achieved after one decade?

Bulgaria has transposed virtually the whole acquis in the environment sector with very few exceptions (mainly related to very new directives and regulations). It has been transposed in a series of new framework laws, most notably the environment protection act, the water act, the waste management act and the clean air act. At least another 9 other laws were considerably modified, at least 31 regulations and 20 ordinances adopted.* See website of the Bulgarian Ministry of Environment and Water, section EU integration – harmonisation.

Bulgaria's institutions in this sector have been dramatically transformed. According to Eulina Milova, the head of the European Integration department of the Ministry of Environment and Water, "the environment sector was completely restructured due to the accession process; due to the obligations undertaken in order to meet the EU criteria, a completely new legislative framework had to be adopted and virtually nothing stayed the same."* ESI interview with Eulina Milova, head of the European Integration Department in the Ministry for Environment and Water, 20 October 2006. Eulina Milova belongs to the army of young people in their 20s and 30s that have changed the Bulgarian administration dramatically on its way to the EU. The staff in the ministry has doubled since 2002 to more than 2,000 people in 2006. The adoption and implementation of the EU's directives and regulations has touched on virtually all directorates and departments of the ministry, who had to build up the capacity to implement the respective policies. The administrative structures need further strengthening, but in essence the ministry is not recognisable from where it has been in 1997.

Although improvements in the environmental sector take time, there are some results that are already visible: Settlements with water supply increased from 4,517 in 1997 to 5,031 in 2004, covering 98.8 percent of the Bulgarian population. In the same period, the number of water treatment plants increased from 51 to 67 in the same period, raising the amount of treated waste water of total waste water from 61 percent to 79 percent. While the late 1990s no data were available on illegal waste dumps, of 5,135 identified in 2002, 3,554 were closed by the end of 2004. Also 12 of 59 landfills serving areas with more than 20,000 people were closed down, as well as 10 industrial landfills. The share of the population covered by municipal waste collection increased from 77 percent to 84 percent. While in 1997 virtually none of the Bulgarian landfills met EU criteria, Bulgaria committed itself to establish a system of 54 regional landfills by 16 July 2009, which requires reconstruction of the existing and construction of new regional landfills for the disposal of the total quantity of municipal waste generated in the country. Gradually, all existing landfills for municipal waste that do not meet the new technical standards have to be closed. By the end of 2004, 20 of the envisaged regional landfills for municipal waste were constructed and put into operation, 12 were under construction, and the remaining were at different stages of preparation for construction.* Ministry of Environment and Water, Operational Programme Environment 2007-2013, Draft, May 2006, p. 16. While in 1997 none of the facilities for treatment of industrial and hazardous waste were in accordance with EU requirements, by 2005 a total of 22 such facilities complied with these requirements.* Data provided by the Ministry of Environment and Water.

According to the "Integrated Pollution Prevention and Control" (IPPC) directive of the EU, 230 large industrial companies have to obtain integrated authorisation permits by end of October 2007. The "integrated approach" means that "the permits must take into account the whole environmental performance of the plant, covering e.g. emissions to air, water and land, generation of waste, use of raw materials, energy efficiency, noise, prevention of accidents, and restoration of the site upon closure. The purpose of the Directive is to ensure a high level of protection of the environment taken as a whole."* EC, DG Environment. 108 or close to half of these permits have been granted so far.* EC, Monitoring report on the state of preparedness for EU membership of Bulgaria and Romania, 26 September 2006, p. 31.

However, this project has not come to an end. The sheer size of the challenges in the environmental sector makes clear that this process needs more time. In a series of areas transitional periods have been negotiated, in particular for covering Bulgaria with EU-standard waste water treatment plans, but also to meet recycling requirements originating with the EU directive on packaging and some heavy polluters (for a whole list of transitional periods in the environment sector see annex).

Imagine Bulgaria in seven years from now. No stone in this sector will have been left unturned. All transitional periods will have come to an end. Even then, probably in some areas there will be still considerable concerns, but Bulgaria will not be recognisable in terms of its environment protection. The Bulgarian operational plan for environment 2007-2013 expects the EU contribution to the environment sector in this period at € 1.3 billion.* Government of Bulgaria, Operational Programme Environment 2007-2013, Sofia, draft May 2006, p. 55.

This money will be well invested. A comprehensive study on the environmental, economic and social benefits of alignment with the environmental acquis in acceding countries estimates annual benefits for Bulgaria after full compliance at between € 290 million and € 2.2 billion.* ECOTEC, The Benefits of Compliance with the Environmental Acquis for the Candidate Countries, July 2001, p. 54. The report notes that no single figures can be given, but the range given should be seen as an indicator of prospective benefits. Such benefits include better public health, less damage to natural resources, promotion of tourism, increased economic efficiency and higher productivity as a result of modern technology, lower consumption of primary material, and support for employment.

There will also be a different style of government, touching upon large segments of society, enhancing democratic practices. The EU provisions provide for a strong focus on public participation. On chemicals, for example, the EC asks to

"ensure that the competent authority has taken steps to consult stakeholders, and has prepared and publishes guidance notes for them. The stakeholders include environmental agencies working on behalf of central government (e.g. regulatory authority, national standards laboratory, veterinary service), regional and local government, municipalities, chemical industry (dangerous substances, manufacture of products including asbestos), construction industry, the public and research institutions (e.g. universities)."* EC, Main administrative structures required for implementing the acquis, Informal Working Document, May 2000 (update 7 June 2004), p. 73.

Thus member state building in the environmental field had a revolutionary impact on the public sector, not only on laws, but also on institutions. It revolutionised relations between the public sector and the public through its insistence on vastly improved and transparent information. It required a level of co-ordination between public institutions, which did not exist in the past. It required national investments as co-financing of EU financed measures. This in turn required multi-annual planning co-ordinated between the various governmental actors, in order to ensure the necessary national funding will be accordingly provided.

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