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CAN DEMOCRATIZATION AND EUROPEANIZATION REDUCE CORRUPTION IN EX-COMMUNIST REPUBLICS?

A LONGITUDINAL CASE STUDY OF BULGARIA

A MAJOR RESEARCH PAPER

PRESENTED TO

THE POLITICAL SCIENCE DEPARTMENT OF GUELPH UNIVERSITY

by

EVGENIA KARAKEHAYOVA

in partial fulfillment

for the degree of Masters of Arts

August 29th. 2014

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Introduction ............................................................................................................................................................................... 3

Chapter 1: Corruption during Communism and Corruption Today ............................................................... 5

Chapter 2: The Collapse of Communism and Political Democratization ....................................................... 9

Why the Collapse of Communism Should Have a Significant Effect on Corruption Reform ................ 9

Why the Collapse of Communism Would Fail To Have a Significant Effect on Corruption Reform14

Chapter 3: Accession to the European Union and Europeanization .............................................................. 19

Why EU Accession Should Have a Significant Effect on Corruption Reform ............................................ 19

Why EU Accession Would Fail To Have a Significant Effect on Corruption Reform ............................. 26

Concluding Remarks ............................................................................................................................................................ 31

Appendix ................................................................................................................................................................................... 36

References.................................................................................................................................................................................. 40

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Introduction

Today, twenty five years after the collapse of communism in Eastern Europe, and seven

years after accession to the European Union (EU), Bulgaria ranks as one of the most corrupt

countries within the EU (see Appendix Table 1). Since 1997, corruption has been perceived as

one of the major societal problems in democratically governed Bulgaria (Bulanova, 54).

According to opinion polls since 1997, Bulgarians have periodically identified corruption as the

third largest problem of democracy, after low incomes and unemployment (Bulanova, 54). In an

impoverished and institutionally unstable country such as Bulgaria, corruption can have a

devastating impact on society, politics and economy, especially considering that the country is

undergoing an intensive developmental period (Bulanova, 54). In 2006 the annual loss through

corrupt transactions in Bulgaria was estimated to be 2 billion Levs per year (about 1 billion

euros) (Bulanova, 55). According to the 2006 Corruption Perception Index, Bulgaria’s corruption

level is next to countries like El Salvador and Columbia, where corruption is perceived to be the

"rule" (Bulanova, 55).

Bulgaria’s corruption levels today are puzzling when taking in consideration the major

institutional changes which occurred in 1989 and in 2007 respectively. First, 1989 marked the

collapse of communism and the institution of democratic principles and market liberalization.

Second, in 2007 Bulgaria officially acceded to the European Union. These transformations were

expected to significantly reduce corruption in Bulgaria, but so far their effect seems to have been

limited. This puzzle is the subject of this research paper, as the paper explores what scholars

have written about the anticipated effects of the processes of democratization and

Europeanization upon corruption practices in Bulgaria.

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The paper yields two conclusions. The first conclusion is that powerful domestic elites

can manipulate periods of institutional reform to their advantage thereby producing skewed

reform and limited results. The second conclusion, which is directly linked to the first one, is that

when mandated reforms are not clear and specific enough, it is relatively easy for political elites to

take advantage of the reform process. The lack of clear, specific reform and the consequent

ability of political elites to take advantage of the reform process are the main reasons why anti-

corruption efforts have produced limited results in Bulgaria, despite of the two major

transformational events considered within this literature review.

In the next three chapters, I will examine what scholars have written about the impact of

the collapse of communism and the accession to the EU upon political corruption in Bulgaria. In

Chapter 1, I will briefly summarize the legacy of communist corruption and will also briefly state

some recent instances of political financial fraud, which drew significant international media

attention and made corruption in post-communist states a highly salient subject. In Chapter 2, I

will introduce arguments from opposing sides on the expected effects of the collapse of

communism upon political corruption in Bulgaria. Similarly, Chapter 3 will present arguments

from opposing sides on the expected effects of Bulgaria’s accession to the European Union upon

political corruption.

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Chapter 1: Corruption during Communism and Corruption Today

As a departing point of this research, I would like to point out that corruption in Bulgaria

exhibits a pattern of continuity, which dates from the communist times and continues until today.

This chapter will show that corruption was indeed prevalent during communism and continues to

be such to this day. For the purpose of this research paper, the term ‘corruption’ will entail both

administrative and political corruption, unless otherwise stated. ‘Administrative corruption’ is

defined as “corrupt transactions in which lower and middle level officials receive kickbacks

(money, gifts, favors) from citizens either to provide a better service or to violate existing rules

and laws” (Stoyanov, 5). Conversely, political corruption is defined as “corruption of high level

officials in the executive, the legislative and the judiciary, typically involving manipulation of

substantial resources and more complicated corruption schemes including political party

financing” (Stoyanov, 6). Another relevant distinction is the difference between what Venelin

Ganev calls ‘cronyism’ and ‘competitive rent seeking’. Ganev defines ‘cronyism’ as a form of

rent seeking, based on personal relationships, nepotism and favoritism, where contracts are

awarded to officials based on personal preferences (Ganev, 29). In contrast, in “competitive rent

seeking” ‘opportunities for profit making are distributed across a wider spectrum of interest

groups and those who wish to offer bribes had to articulate at least a rudimentary argument as to

why the corrupt transaction with self-interested politicians might be of mutual interest” (Ganev,

29). Ganev argues, that during communism ‘cronyism’ was a widely accepted norm and was

openly practiced in the political sphere, while ‘competitive rent seeking’ was not, as this latter

type of corruption is usually associated with capitalist systems (Ganev, 30)

It is important to highlight that like Ganev, many other scholars identify the communist

regimes of the past as plagued with ‘cronyism’ and internal political and administrative

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corruption. Leslie Holmes (2009) for example, calls the communist legacy the ‘ghost from the

past’ which has socialized nation states into a culture of bureaucratic corruption and a tradition

of organized crime and has blurred the distinction between the state and the economy (Holmes,

283). Holmes adds that communist regimes left behind badly damaged public institutions,

dysfunctional state structures, and bureaucratic apparatuses bereft of administrative capacity

(Holmes, 284). All in all, corruption practices may have changed since the communist times, but

corruption has certainly not disappeared as nearly all scholars enumerated in this literature

review are in agreement that corruption remains a significant challenged for Bulgaria today.

The fact that corruption remains a significant challenge for Bulgaria becomes evident

when we briefly examine the country’s road to EU accession. First, in 2004, at the first round of

EU eastern enlargement, Bulgaria and Romania were singled out and denied accession, whilst

ten other post-communist Central and Eastern European (CEE) states were accepted into the EU.

(For more information on Bulgaria’s Accession Timeline, please see Appendix Table 4) Second,

in May of 2006 the European Commission sent a ‘yellow card’ to Bulgaria, strongly

recommending for the country to “seriously intensify its efforts to crack down on organized

crime and corruption” (May 2006 Monitoring Report), Third, Bulgaria and Romania were the

only countries accepted with post-accession conditionality and the Commission applied the

strictest provisions to those two member states, mainly because of their inability to control

political corruption. (Please see Appendix Table 2 for comparative outline of CEE

conditionality)

Furthermore, in 2008, one year after accession to the EU, the phenomenon of corruption

in Bulgaria enjoyed a significant amount of international media attention, when the British

newspaper ‘The Telegraph’ called Sofia “Europe’s corruption capital”. This attention was in

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direct response to a report published by the European Commission in February of 2008,

implicating Bulgarian officials in one of the most disconcerting money syphoning scandals that

the European Union had witnessed. The Commission proved that millions of euros granted to

Bulgaria during the pre-accession phase for rural and agricultural development were corruptly

syphoned off (Holmes, 282). Although the Commission had evidence to implicate a multitude of

Bulgaria officials, there was one blatant form of embezzlement which ultimately led to economic

sanctions imposed later by the EU. This was the case of Vesselin Georgiev who in 2007 and

2008 was in charge of distributing European money allocated for the upgrade of Bulgaria’s

transportation infrastructure (Ganev, 31). In 2007 and 2008 Georgiev channeled hundreds of

millions of euros into bank accounts owned by his brother (Ganev, 31-32). As a result, the

European Commission suspended a total of 825 million euros of financial assistance to Bulgaria

(Agence Europe, 2008). Bulgaria was the first EU member state to lose EU funds due to ill-use

(Agence Europe, 2008).

Scholars observing the effects of EU accession upon Bulgaria’s political corruption are in

general agreement that the country has not managed to successfully implement corruption reform

(Pashev, 2011; Bulanova, 2008; Trauner, 2009; Racovita, 2009; Spendzharova and Vachudova,

2012; Ganev, 2013; Pop, 2008). As Pashev puts it: “Corruption remains a significant problem,

and despite expectations to the opposite, the situation seems to have deteriorated since the

country’s accession to the EU in 2007” (Pashev, 413). Currently, reforming the judiciary and

improving administrative efficiency remain Bulgaria’s biggest challenge in the fight against

political corruption and organized crime (Spendzharova and Vachudova, 52). The next chapter

will take us back over two decades ago, to the initial stages of the political democratization

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process in attempts to trace the history of corruption reform in Bulgaria, even before it was

subject to EU conditionality.

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Chapter 2: The Collapse of Communism and Political Democratization

The chapter will examine a) theories as to why the collapse of communism should help

curb corruption in Bulgaria; and b) countervailing views that the collapse of communism will not

have an effect or will worsen corruption practices in Bulgaria.

It must be noted that the collapse of communism in Bulgaria had two major

consequences: first, it introduced the tenets of democratic governance, including elections

characterized by opposing political parties and the separation of legislative, executive and

judicial powers; and second, it brought the dissolution of the centrally planned and state-owned

economy. This dissolution entailed, among other things, the mass privatization of state

enterprises and the liberalization of economic activity (Peev & Mueller, 372). The potency of the

economic liberalization which occurred in Bulgaria is exemplified through the radical shift of

private versus public property ratios. From 1989 to 2005 the structure of property in the country

changed so dramatically that the ratio between state and private property of industrial assets

plummeted from 96:4 to 20:80 (Stoyanov, 5). For more information, see Appendix Table 3.

WHY THE COLLAPSE OF COMMUNISM SHOULD HAVE A SIGNIFICANT EFFECT ON CORRUPTION REFORM

There is much research, in particular based on quantitative cross-national analyses,

suggesting that one may expect to witness a reduction in political corruption after the collapse of

communism. More specifically, many scholars have found that both democratization and

economic liberalization tend to be negatively correlated with corruption levels. I will discuss

each of these points in turn.

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POLITICAL DEMOCRATIZATION

Many quantitative studies find a negative correlation between democratic governance and

levels of corruption (Sandholtz & Koetzle, 2000; Treisman, 2000; Sandholtz & Taagepera, 2005)

Specifically, Sandholtz & Koetzle (2000) find that the level of corruption correlates negatively

with the strength of democratic institutions and the length of the experience of democratic rule.

The same correlation between longevity of democratic rule and corruption level is also

established by Treisman (2000) who finds that the longer a country has been a democracy, the

lower the perceived level of corruption.

The literature typically explains these correlations by arguing that both institutional and

normative characteristics of a democracy help suppress corruption (Sandholtz & Koetzle, 38).

On the normative side, authors claim that a society will generally not care about detecting and

punishing acts of corruption, unless the cultural and widely accepted norm is that such acts are

harmful and should be prevented (Sandholtz & Koetzle, 39). Democratic governments tend to

socialize both citizenry and officials to hold the normative view that corruption is abhorrent and

unacceptable. After all, corruption violates the fundamental democratic values of openness and

equal treatment (Sandholtz & Koetzle, 42). On the institutional side, the argument is that

democratic institutions tend to lower corruption by offering citizens effective means to detect

and punish corruption (Treisman, 2000; Sandholtz & Koetzle, 2000). Two sets of democratic

institutional factors are most relevant in this regard, namely political rights and civil liberties.

Political rights include: free and fair elections of political leaders who possess real policy-

making powers; the right to form political parties; freedom from domination by the military or

other oligarchic groups; the existence of genuine political opposition; and protection of minority

rights. Civil liberties include: the right to free speech and media, freedom of assembly, the right

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to organize, and equality under the law (Sandholtz and Kotzle, 2000; (Treisman, 2000). Political

rights can decrease corruption by reducing the power of political official over the electorate and

by providing means for the electorate to accurately inform itself and to express its informed

opinions in the form of voting, without fear of persecution. Through voting, the electorate can

validate political officials’ actions. Undesirable or harmful actions can yield direct and sizeable

consequences in the form of loss of votes, loss of confidence and others. Similarly, civil liberties

can decrease corruption by permitting the existence of channels through which the electorate can

disseminate uncensored information, allowing itself to make the informed decisions necessary

for the correct validation of public officials. This is to be contrasted with communism, during

which a single political party would typically dominate parliament, prohibiting competitive

periodic elections. Without palpable competition and substantial fear of the loss of power,

communist parties tended to be disincentivized to public accountability. Likewise, communist

regimes suppressed the dissemination of uncensored information, thus disallowing the public to

think critically and to make informed decisions regarding the ruling party.

Considering both the normative and institutional features of democratic governance it is

reasonable to expect that in Bulgaria the process of democratization would have a significant and

positive effect on lowering corruption. Furthermore, in light of the established relationships

between strength of democratic institutions and length of democratic governance on the one hand

and corruption on the other hand, it is not surprising that many initially expected the period after

the collapse of communism and the adoption of both normative and institutional democratic

principles to decrease political corruption in Bulgaria.

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ECONOMIC LIBERALIZATION

Regression analyses also tend to find that economic liberalization and mass privatization tend

to be associated with a decrease in corruption (Sandholtz & Koetzle, 2000; Whitehead, 2002;

Ades & Di Tella, 1999; Sandholtz & Taagepera, 2005). Sandholtz & Koetzle claim that

economic liberalization encompasses the following economic rights: freedom to hold property,

freedom to earn a living, freedom to operate a business, freedom to invest one’s earnings,

freedom to trade internationally, and freedom to participate in a market economy (Sandholtz and

Koetzle, 41). Considering the features of economic liberalization, Sandholtz & Koetzle

establish two strong and significant empirical correlations (Sandholtz & Koetzle, 37-40): First,

they find that the degree of integration into the international economy correlates negatively with

the perceived level of corruption (Sandholtz & Koetzle, 37). Second, they find that the degree of

state control of the economy correlates positively with corruption (Sandholtz & Koetzle, 40).

The latter correlation is also established by Whitehead (2002) who also proves that the inverse

relationship holds true, asserting that “interventionist economic systems encourage high-level

corruption” (Whitehead, 801).

The literature explains the aforementioned correlations in several ways. First, it has been

argued that competitive markets (Ades & Di Tella, 1999) and openness to trade (Sandholtz &

Koetzle, 2000) reduce corruption by shrinking the pools of rents available for giving or taking

bribes, or, put differently, by increasing the costs of corrupt actions (Sandholtz & Taagepera,

2005). This is because in a free market, bribes function as a form of value-added tax, thus

decreasing the competitiveness of services and products. In this way, competition created

through economic liberalization penalizes bribery and can therefore be expected to reduce

overall corruption levels (Sandholtz & Koetzle, 39). Second, a free market is likely to restrict

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access of political officials to licenses, permits and waivers which they could otherwise exchange

for bribes in order to gain unfair advantage (Sandholtz & Koetzle, 39). In a free market, such

administrative goods are treated as any other good and are thus “produced” by accredited bodies

and “sold” to qualified purchasers who can afford to pay the price of the administrative good. In

this way, such administrative goods are not reserved to certain political officials and since the

process involves several independent bodies competing for the same good, preferential treatment

is unlikely. Similarly, Whitehead (2002) claims the there exists a stark contrast between liberal

market economy and interventionist economy in that “while interventionist economic systems

encourage high-level corruption by manipulating markets and allowing public officials to

distribute profits, transitions to open market economies reduce public & private actors' political

opportunities while augmenting public accountability” (Whitehead, 801). Finally, economic

liberalization tends to be accompanied by an inevitable insertion into international markets and a

consequent adoption of international trade rules and norms. International trade is dominated by

the Organization for Economic Cooperation and Development (OECD) countries and is based on

transnational, “Western” business norms. Consequently, within the realm of OECD-dominated

international trade, corruption is a prohibited act and an obstacle to economic optimization

(Sandholtz & Koetzle, 40).

In short, many scholars observed that economic liberalization works against the proliferation

of corruption. The findings of (Ades & Di Tella, 1999; Sandholtz & Koetzle, 2000; Sandholtz &

Taagepera, 2005; and Whitehead 2006) all support the hypothesis that the collapse of

communism and the democratization and market liberalization reforms which followed should

exert a positive and significant effect on curbing corruption levels in Bulgaria.

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WHY THE COLLAPSE OF COMMUNISM WOULD FAIL TO HAVE A SIGNIFICANT EFFECT ON CORRUPTION REFORM

Some scholars question the optimistic suggestions reviewed above by pointing out that (1)

rapid democratization imports only a minimal conception of democracy; and (2) economic

liberalization may in some cases actually increase opportunities for corruption.

MINIMALIST CONCEPTION OF DEMOCRACY A significant body of literature asserts that the type of democracy instituted in Bulgaria

shortly after the collapse of communism can be classified as a ‘minimalist’ democracy

(Bulanova, 2008; Grabbe, 2001; Haughton, 2007; Rose, 1994; Spendzharova and Vachudova,

2012; Stoyanov, 2006; Sandholtz and Taagepera, 2005). A minimalist democracy is a system of

government in which citizens give teams of political leaders the right to rule in periodic

elections, but where deeper, more profound democratic features are lacking. A minimalist

democracy may lack normative features, such as public trust in government institutions, the

belief that minorities deserve to be included and respected, and an active civil society. According

to this literature, a ‘genuine’ democracy is the product of a myriad of long term historical,

cultural and institutional norms, and cannot be imported through a simple adoption of democratic

structures. The lack of these normative democratic features within a ‘minimalist democracy’ can

obstruct the success of anti-corruption reform (Bulanova, 2008; Spendzharova and Vachudova,

2012).

Spendzharova and Vachudova argue that following the end of Communist rule, “an

illiberal democracy took hold in Bulgaria [in which winning parties] warped democratic

institutions, sabotaged economic reform and fostered intolerance in their efforts to concentrate

and prolong their power” (Spendzharova and Vachudova, 38). Similarly, they claim that ‘in

Bulgaria, the revolution of 1989 was an internal communist coup where second-tier opportunists

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reinvented themselves as transitional democratic leaders, and then used the power of the state to

win early elections" (Spendzharova and Vachudova, 40). The view that a superficial democratic

model was adopted in Bulgaria is further supported by Bulanova, who asserts that there exists a

strong link between a ‘minimalist democracy’ and failure of anti-corruption reform:

It is undisputable…that the “minimalist concept of democracy” […] is not enough in order to establish a functioning, sustainable democracy. Democracy does not only mean that people can vote in free and fair elections, but that they can influence public policy as well. I suggest that state failure in anticorruption corresponds directly to the quality of the established (achieved) democratic model (Bulanova, 56-59).

Similarly, Stoyanov describes another feature of Bulgaria’s minimalist democracy in

claiming that for decades, the Bulgarian public had been accustomed to living within a culture

where corruption was the norm (Stoyanov, 10). In a society where corruption perpetuates to be

perceived as the norm for a significant period of time, it becomes an effective means of solving

problems and further increases both the citizenry and officials’ inclination to engage in corrupt

behavior (Stoyanov, 10). In accordance with Stoyanov’s argument, Rose describes yet another

feature of Bulgaria’s minimalist democracy in claiming that besides the acceptance of corruption

as the norm, the Bulgarian public suffers from profound and widespread mistrust in political

institutions (Rose, 19): “Substantial majorities of citizens in post-communist regimes… find that

their societies lack a key ingredient: trustworthy institutions capable of mediating between

individuals and the state” (Rose, 19). Rose and Stoyanov both point to the lack of soft, cultural

norms in Bulgarian society as fundamental obstacles to successful corruption reform. While

Stoyanov emphasizes the acceptance of corruption as a cultural norm, Rose points to the

widespread and persistent public distrust in political institutions. The presence of such cultural

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attitudes within Bulgarian society is in accordance with the definition of a ‘minimalist democracy’.

As Sandholtz & Taagepera assert:

“The swift transition to democratic political reform at the collapse of communism, could not obliterate corruption in post-communist societies…Communism had produced a culture of corruption; entire populations had been socialized into norms and expectations that made corruption part of their way of life. Those cultural legacies of communism were unlikely to simply vanish with the political system that engendered them” (Sandholtz and Taagepera, 110 & 127).

In short, one of the main explanations in the literature for the limited effect of

democratization on corruption is that the simple adoption of a democratic model is not sufficient

to erase corrupt practices arising from cultural customs and behavioral habits, since such habits

change slowly trailing behind even the most comprehensive political and institutional shifts

(Sandholtz and Taagepera, 127)

PRIVATIZATION MAY INCREASE CORRUPTION

Conversely, a group of scholars hold that mass privatization following the collapse of

communism actually created new opportunities and incentives for corruption (Holmes, 2006;

Sandholtz and Taagepera, 2005; Sokhey and Yildirim, 2013).One reason why corruption could

increase along with economic liberalization is that post-communist countries are likely to

experience a phenomenon that Holmes refers to as “nomenklatura privatisation” and Sokhey &

Yildirim refer to as “crony economic liberalization”. This is when the old communist power elite

attempt to become the new economic elite by distributing resources amongst each other, under a

new government structure. The old elite may use the privatization process for their own

advantage, selling formerly state-owned enterprises at low prices, either to friends and relatives,

or to themselves (Holmes, 286). Indeed, Sokhey and Yildirim (2013) claim that the “crony

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economic liberalization” in Bulgaria was controlled by small elite of ex-communist party

officials who redistributed the country’s assets and enterprises amongst themselves (Sokhey &

Kildirim, 2013). In essence, Sokhey and Yildirim argue that the communist party that dictated

economic policy before the collapse of communism had successfully adapted to the now

seemingly democratic and capitalist environment. Thus, in Bulgaria, the true tenets of economic

liberalization were not met, but instead, a superficial government decrease in market intervention

was exhibited, in which the elites “maintained extremist ideological core standing in opposition

to democracy and the free market” (Sokhey and Yildirim, 3).

Furthermore, state officials may attempt to benefit from the process of privatization in

another way, namely by demanding bribes for the sale of certain enterprises. As Sandholtz &

Taagepera claim, “when state officials distribute state properties and enterprises to private

owners, bribes and payoffs become the preferred method for the allocation of the richest assets”

(Sandholtz and Taagepera, 114). A World Bank study in 2000 found that the dual transitions of

economic liberalization and privatization, coupled with democratization removed whatever

mechanisms had been in place to control corrupt behaviors (Pradhan and Anderson, 26). The

report concluded that:

‘the simultaneous transition processes of building new political and economic institutions in the midst of a massive redistribution of state assets have created fertile ground for state capture and administrative corruption… Numerous examples exist in all countries in transition where ownership or control of key state assets was transferred through nontransparent means to those with political influence; corruption played a key part in this process’ (Pradhan and Anderson, xix)

Lastly, it has been theorized that since all of the post-communist states experienced

significant economic hardships throughout the 1990s, it made corruption during privatization a

highly attractive option (Holmes, 282). This is because economic hardships create incentives for

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engaging in corrupt behavior, as relative poverty can increase the motivation for both citizens

and officials to enhance their incomes through corruption (Sandholtz and Koetzle, 40).

To summarize, the literature shows that the economic liberalization which occurred in

Bulgaria after the collapse of communism created a multitude of opportunities – mostly through

mass privatization - for asset grabs and for a crony distribution of state property, dominated by a

monopoly of political elites. Many scholars point out that the period after the collapse of

communism in Bulgaria was characterized by a chaotic transition, in which “the combination of

poor state control with widespread despair and economic hardship was a powerful explicator of

increased rates of general crime and corruption” (Holmes, 282).

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Chapter 3: Accession to the European Union and Europeanization

The chapter will examine a) arguments as to why EU accession should help curb

corruption in Bulgaria; b) countervailing views that that EU accession will not have an effect or

will worsen corruption practices in Bulgaria.

First, it must be noted that once a country enters into EU accession negotiations, it agrees

to concede certain areas of policy making to supranational authority. (For more information on

Bulgaria’s Road to accession, see Appendix Table 4.) Policy-making within the European Union

is a complicated process, referred to as a “balancing act between the European level, the national

level and the sub-national level” (Warleigh-Lack & Dranchenberg, 200). The EU exercises

exclusive supranational competence over policy areas relating to the economic market, but

allows members to exercise considerable national sovereignty over other areas like

administrative coordination and the judiciary (Warleigh-Lack & Dranchenberg, 201). In policy

areas where the EU allows national sovereignty the bulk of the responsibility for reform lies with

the member states themselves.

WHY EU ACCESSION SHOULD HAVE A SIGNIFICANT EFFECT ON CORRUPTION REFORM

A rich body of existing literature suggests that EU accession can help curb corruption

levels in Bulgaria through [1] The adoption of the ‘acquis communitaire’, which requires certain

standards of administrative, and judiciary governance; and [2] The mechanisms of pre-accession

conditionality and post-accession verification.

First, it must be noted that in 1993, the European Commission established a set of

quantifiable criteria (known as the Copenhagen Criteria) that candidate members were required

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to implement in order to successfully accede. These criteria consist of (Accession Criteria,

European Commission, 2009): [a] Political criteria: stability of institutions guaranteeing

democracy, the rule of law, human rights and respect for and protection of minorities; [b]

Economic criteria: a functioning market economy and the capacity to cope with competition and

market forces; [c] Administrative and institutional capacity to effectively implement the ‘acquis

communitaire’ and the ability to take on the obligations of membership. As was the case with

Bulgaria in 1997, failure to comply with the conditions outlined in the Copenhagen Criteria

results in postponement of the invitation to join or an overall rejection of candidacy (see

appendix Table 4).

ADMINISTRATIVE AND JUDICIAL REFORM

Literature contends that when the European Union demands from its candidate members

to build the administrative and institutional capacity to adopt and transpose the ‘acquis

communitaire’ within domestic law, the EU also demands a certain standard of good governance

within public administration (Grabbe, 2001; Schimmelfenning and Sedelmeier, 2004;

Papadimitriou and Gateva, 2009; Haughton, 2007; Vachudova, 2009). The content of the acquis

itself does not provide a specific administrative model to be followed by candidates, nor does it

explicitly specify corruption control. However, in various policy areas, the acquis commands the

creation and establishment of administrative structures required in order to successfully

implement prescribed policy reform. The creation and establishment of these administrative

structures requires a functioning, transparent, accountable and efficient public administration

system. Thus, in an indirect way, and without being explicitly outlined within its content, the

acquis may positively affect the transparency and accountability of Bulgarian public

administration. As Papadimitriou and Gateva claim, ‘through a mixture of formal and informal

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mechanisms of applying pressure, the acquis could exert tremendous influence on corruption

practices’ (Papadimitriou and Gateva, 5-6).

In regards to the acquis itself, the document consists of 80,000-pages of supranational

law, which must be transposed into domestic law (Haughton, 238). Applicant countries have

virtually no bargaining power when it comes to adoption and transposition of the acquis

communitaire, as it is a non-negotiable process in which the acquis takes precedence over

national law (Grabbe, 2001). The largest share of the acquis relates to the functioning of the

internal market, including economic liberalization (Vachudova, 50) (see also the discussion

above on the possible effects of economic liberalization on corruption). Thus, despite of the lack

of a working model in the area of administrative reform within the acquis, the acquis can be

expected to indirectly affect Bulgarian public administration through the demand for a

functioning and transparent administrative capacity.

The judiciary is a second area where the acquis is expected to positively affect corruption

practices. Scholars argue that during the pre-accession negations, the EU demanded from

Bulgaria a solidified establishment of the democratic principle of the separation and

independence of the judiciary, which at the time required deep judicial reform (Frison-Roche and

Sodev, 2005; Grabbe, 2001). In fact, it is argued that in order to meet acquis standards, Bulgaria

has undergone a deep transformational and restructuring process of the judiciary, beginning in

the early ‘90s. First, during the very initial EU accession talks in 1991, Bulgaria adopted the

first- of- its- kind article of the constitution which made official the separation of judicial,

administrative and executive powers for the first time. Article 8 of the Constitution stipulated

that ‘State power is separated into the legislative branch, executive branch and judicial branch’ –

a separation that did not exist during communism (Frison-Roche and Sodev, 72). This separation

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can be attributed to reforms outlined within the ‘acquis communitaire’. Second, in 1994,

Bulgaria adopted the basis for its first democratic judicial system and created the Courts of

Appeal, the Administrative Supreme Court and the Supreme Court of Cassation (Frison-Roche

and Sodev, 71). In the period from 2001 until 2005, under EU directive, Bulgaria undertook

another significant long term commitment to further reform and improve the transparency and

impartiality of its judiciary, “replacing the old criminal-procedures code which dated back to the

Communist era; ensuring the openness of the judicial system and reviewing the functioning of

the Public Prosecutor’s Office, and improving the training, recruitment and assessment of the

magistrates” (Frison-Roche and Sodev, 71).

Several scholars have argued that these judicial reforms can be expected to hamper

corruption through creating a system of checks and balances, which would decrease favoritism

and nepotism towards political elites implicated in charges of fraud or corruption (Frison-Roche

and Sodev, 2005). For Bulgaria, establishing a satisfactory level of judicial independence and

functionality is crucial, as several authors point to the inefficiency of the judiciary at persecuting

and sentencing corrupt political officials as one of the major contributors to the perpetuation of

corrupt practices (Frison-Roche and Sodev, 2005; Popova, 2012; Noutcheva and Bechev, 2008).

It can be argued that for a country with a significant legacy of nepotism and favoritism between

political elites and magistrates, establishing the principle of the separation of powers and

solidifying the independence of the judiciary can aid in increasing the instances of successful

persecution and sentencing of corrupt political officials, thereby resulting in an overall reduction

of corruption (Frison-Roche and Sodev, 2005; Popova, 2012).

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PRE-ACCESSION CONDITIONALITY AND POST-ACCESSION VERIFICATION

The literature also claims that EU membership could reduce corruption in Bulgaria in two

different phases and through two different mechanisms: first, during the pre-accession phase the

EU utilizes a mechanism of conditionality which involves gate-keeping and monitoring, and it

also utilizes peer pressure and mutual persuasion in order to promote good governance or to

reduce corruption. Second, in the case of Bulgaria (and Romania as well) the EU also utilizes a

mechanism of verification and cooperation to ensure post-accession compliance.

First, the pre-accession phase is marked by conditionality and gate-keeping. Gate-keeping

has been argued to be the EU’s most powerful and most commonly used conditionality tool as it

functions by restricting candidate members from advancing in the accession process if they fail

to comply with certain criteria (Grabbe, 1022). In analysis of the effectiveness of gate-keeping,

Schimmelfenning and Sedelmeier (2004) hypothesize that EU gate-keeping functions based on

an external incentives model, in which the EU sets rules as conditions that members must fulfill

in order to advance to the next step of the accession process or to receive EU rewards. EU

rewards may come in the form of financial aid, trade and co-operation agreements and

investments. Bulgaria is highly economically incentivized to join the EU and to comply with all

EU conditionality, even if it conflicts with national interest or if it necessitates profound reform

(Grabbe, 2001; Noutcheva and Bechev, 2008; Haughton, 2007; Spendzharova and Vachudova,

2012 ) Grabbe elaborates that “EU aid in particular – both current receipts and the prospect of

future transfers – has a direct impact in creating new governance structures [in candidate

countries]” (Grabbe, 1023). Moreover, Noutcheva claims that market sanctions, in the form of

low foreign direct investment (FDI) flows and high costs of external borrowing, combined with

EU sanctions make it very costly for Bulgaria to deviate from the prescribed conditional reform

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pathway (Noutcheva and Bechev, 116). In short, as Spendzharova puts it, Bulgaria simply does

not possess resources to negotiate compliance with EU conditionality (Spendzharova and

Vachudova, 43). Thus, the economic benefits of joining the EU and the gate-keeping tool of

conditionality provide a strong incentive to meet the requirements as they are presented (Grabbe,

2001). In this way, the use of gate-keeping as an essential conditionally tool during the pre-

accession phase, can have a significant and positive impact upon good governance practices and

can thus be expected to reduce corruption.

The second conditionality tool that the EU utilizes during the pre-accession phase is

monitoring. Monitoring is a key mechanism involving continuous official assessment of how

prepared each candidate is in particular policy area. Monitoring is carried out in the form of

‘Regular Reports’ published by the European Commission (Grabbe, 1021). The European

Commission is committed to the reduction of corruption as exemplified in the following quote:

“It is the Commission's firm intention to reduce corruption at all levels [, i.e. political corruption,

corrupt activities committed by and collusively with organized crime groups, private-to-private

and so-called petty corruption] in a coherent way within the EU institutions, in EU Member

States and outside the EU” (“Fight Against Fraud”, 9) Thus, the European Commission utilizes

monitoring during the pre-accession phase in order to point out areas that necessitate reform so

as to incite candidate members to comply with the Commission’s anti-corruption mandate. In

short, considering the Commission’s commitment to the fight against corruption, it can be

expected that monitoring during the pre-accession phase can also aid in reducing corruption in

candidate member states.

Lastly, the final tool utilized by the EU during the pre-accession phase is peer pressure

and mutual persuasion. Authors Nicolescu-Waggonner and Bowler claim that pre-accession

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conditionality tools can indirectly reduce corruption by changing the predominant norms and

beliefs in candidate countries: “Conditionality may be a sufficient condition for good governance

through the spread of norms and ideals” (Nicolescu-Waggonner and Bowler, 6). The EU

employs two main anti-corruption bodies, namely the European Anti-Fraud Office (OLAF) and

the “Working Group on Bribery and the Council of Europe Group of States against Corruption”

(GRECO) who function based on the principles of peer pressure and mutual persuasion. These

bodies do not contain legal sanctions to ensure compliance. Nevertheless, they can reduce

corrupt practices through the ‘softer’ mechanisms of peer pressure and mutual persuasion

(Nicolescu-Waggonner and Bowler, 6). Several authors show evidence that peer pressure and

mutual persuasion may be sufficient in encouraging the development of good governance

practices and in reducing corruption (Schimmelfenning and Sedelmeier, 2004). In sum, various

literature claims that it can be expected that pre-accession conditionality will reduce corruption

practices in Bulgaria through gate-keeping and monitoring and also though peer pressure and

mutual persuasion.

Now, I will discuss the EU’s impact on corruption practices during the post-accession

period. It has been argued that the EU can continue to positively affect corruption practices in the

post-accession phase by employing benchmarking. Benchmarking is part of the European

Commission’s “Cooperation and Verification Mechanism” (abbreviated as CVM), which was

established in 2007 as the first strong enforcement mechanism to monitor corruption. The CVM

is a highly specialized, unique and unprecedented mechanism, developed and utilized for the first

time as a clause within the Accession Treaty of Bulgaria and Romania (Grabbe, 2001).

According to the Commission, the main purpose of CVM is ‘to smooth the entry in the EU and

at the same time safeguard the workings of the EU’s policies and institutions’ (Vachudova, 53).

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The CVM periodically establishes specific benchmarks in the areas of judicial reform and the

fight against corruption and organized crime (Grabbe, 1022). It sets up teams to monitor

domestic developments in these areas and to publish their findings in periodic reports. The first

such report was published in June 2007 (Vachudova, 53). Bulgaria and Romania are the only two

EU members accepted with such post-accession conditionality requirements and the Commission

applied stricter provisions and conditions to those two candidates than to any other previous

candidate (Noutcheva and Bechev, 2008). (For a comparative outline of accession conditionality,

see Table 2) The CVM is a direct, highly specific, and quantifiable post-accession mechanism to

control and curb corruption. The CVM is linked to direct punishment in the form of economic

sanctions. Unsurprisingly, therefore, many authors have expected its effects on corruption levels

in Bulgaria to be sizeable.

WHY EU ACCESSION WOULD FAIL TO HAVE A SIGNIFICANT EFFECT ON CORRUPTION REFORM

In sharp contrast to the arguments reviewed above, a significant body of literature

maintains that EU accession may fail to have a significant impact on corruption reform in

Bulgaria, because [1] the acquis’ vagueness in the area of administrative coordination and

judiciary is likely to result in unsuccessful reform, and [2] EU’s incentive-based model of

conditionality is likely to cease to be effective after accession.

VAGUENESS OF THE ACQUIS

Many authors have argued that the criteria for administrative reform within the ‘acquis

communitaire’ have been too vague to bring about any real change. Jacoby, for example, claims

that “The extent to which EU-prescribed reforms were successful was not universal across all

applicant countries, due to several factors pertaining to the nature of the acquis itself” (Jacoby,

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16). Where the EU’s requirements are clear, specific and directly linked to a reward, the reforms

are more likely to be successful, but where requirements are embodied in vague or unsettled

sections of the acquis, only limited change occurs (Haughton, 243). An area where the acquis

lacks sufficient clarity is administrative coordination, which can be directly linked to the failure

of effective implementing capacity:

“… the EU does not have competence over the administrative structures and procedures of current member states. Consequently, it lacks any formal rules on the meaning of the concept of effective implementation and/or enforcement. This uncertainty about implementation makes it difficult for the EU to shape particular institutional solutions” (Grabbe, 1019).

Furthermore, it is maintained that in a policy area where the EU has limited competence, its

progress evaluations fail to be effective, because they are unsuccessful in outlining specific goals

to be achieved:

“…the most important aspects are the Commission’s assessments of administrative capacity …. However, the goals are often vague, citing a need for ‘increasing capacity’ or ‘improving training’, rather than stating detailed institutional preferences…candidates are often asked to ‘prepare a national strategy’ in a particular area, with no further details on what it should contain or what the features of particular institutions should be” (Grabbe, 1022).

The outlining of specific goals that need to be achieved in a certain policy area is a crucial part of

the effectiveness of conditionality. Without clear delineation of the next steps to be achieved in

an area, a candidate member is likely to struggle in complying with conditionality requirements.

A World Bank study reported that in the case of Bulgaria, the acquis produced numerous pieces

of legislation which “courts, lawyers, regulatory bodies and others charged with implementation

had difficulty understanding, applying and enforcing,” leading to a serious “implementation gap”

(Noutcheva and Bechev, 133).

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Secondly, literature shows that besides the vagueness of the acquis in the area of

administrative reform, the acquis is also relatively vague in the area of judicial reform. As

Noutcheva and Bechev claim "unfortunately, the EU acquis could not prescribe one single model

of a judiciary system for Bulgaria to follow" (Noutcheva and Bechev, 133). However, as it has

been previously noted, during the pre-accession phase Bulgaria did make some significant strides

in the area of judicial reform, making its judiciary more compliant with democratic principles.

Nevertheless, judicial independence and efficiency remain a key challenge in Bulgaria: “The

judicial systems of both Bulgaria and Romania were considered as slow and inefficient with

trials lasting for years ... the Commission pointed out the reform of the judiciary in almost every

Regular Report”(Noutcheva and Bechev, 133). It can be hypothesized that the incomplete

success of judicial reform can at least in part be attributed to vagueness of the acquis

communitaire in the regard. Without a clear, specific and functioning judicial model to follow, a

candidate member such as Bulgaria, whose judiciary has traditionally not been politically

impartial and has been classified as ‘corrupt and ineffective’, will likely not be able to

successfully reform independently. In summary, it has been argued that the EU’s transformative

capabilities have been limited in the administrative and judicial branches of Bulgarian

government because of a lack of a clear and specific reform model to follow. Since the acquis

does not specify exactly how the judiciary and administration should be reformed, it can be

expected that the EU will not have a sizable effect on corruption in those two sectors.

EU’S INCENTIVES AFTER ACCESSION

The literature shows a pessimistic outlook regarding the continuous effectiveness of

conditionality-driven reform after Bulgaria’s approval for accession (Mungiu-Pippidi, 2007 ;

Schimmelfenning and Sedelmeier, 2004; Schimmelfenning and Sedelmeier, 2002; Dimitrova

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2004; Vachudova, 2009; Spendzharova, 2004 ). As Alina Mungiu-Pippidi bluntly proclaims: “As

for the day after accession, when conditionality has faded, the influence of the EU will vanish

like a short-term anesthetic” (Mungiu-Pippidi, 1). Likewise, Schimmelfenning and Sedelmeier

(2004) predict that the incentive-based model utilized in pre-accession conditionality is likely to

cease to be effective once accession is achieved. “The absence of these incentives should

significantly slow down or even halt the implementation process” [after accession]

(Schimmelfenning and Sedelmeier, 676). Schimmelfenning and Sedelmeier (2004) explain that

while adherence to EU rules prior to accession is in the best interest of candidate members, as it

is the most rational option to maximize their own power; this no longer becomes the case once

accession is achieved (Schimmelfenning and Sedelmeier, 678). This is because once accession is

achieved, new members have significantly less to lose – in terms of both economic rewards and

other forms of rewards – should they choose to deviate from EU rules. Thus, employing a

rational cost-benefit calculation, Schimmelfenning and Sedelmeier (2004) expect that

conditionality-driven reform in Bulgaria will see a significant slowdown or even a standstill after

accession. Several other authors support Schimmelfenning and Sedelmeier’s predictions in

claiming that once membership is achieved, the externally imposed costs of not pursuing reforms

or complying with the EU will diminish (Dimitrova, 47); and “the most likely lesson will be that

EU leverage is more powerful well before accession than after it, regardless of the EU’s new

tools to encourage post-accession compliance” (Vachudova, 44).

In terms of encouraging post-accession compliance, as previously discussed, the most

powerful post-accession EU compliance tool is the CVM. It must be noted that the CVM has not

enjoyed significant attention in the literature and the authors cited in this literature review have,

for the most part, not discussed its effectiveness. The CVM’s benchmarking mechanism does

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indeed create an incentive for Bulgaria to carry out specifically outlined reform and it also

presents the threat of economic sanctions and cessation of financial aid in case that Bulgaria fails

to carry out these reforms. However, inferring from the incentive-based model, it can be argued

that the power of post-accession sanctions is weaker than the threats presented during the pre-

accession phase. Once accession is granted, not only does a candidate country receive entrance to

EU markets, but it has already built significant capital through pre-accession funds. It seems that

the stakes are much higher at the threat of denial of accession, as compared to the threat of

cessation of certain post-accession funds. For this reason, although the CVM does provide some

incentive to continue the path of reform, this incentive may not be as strong as pre-accession

conditionality and it can be expected that reform implementation process may significantly slow

down or even come to a halt once accession has been granted. If the CVM is not powerful

enough to incentivize continued reform after accession, it can be expected that the EU’s

influence upon reducing corruption will be limited as “substantial improvements in the rule of

law and in the fight against corruption require a sustained domestic commitment to institutional

change, which does not seem to be present in Bulgaria, especially after the incentives of EU

accession conditionality disappear” (Spendzharova and Vachudova, 45). However, as mentioned

above, few scholars have investigated the conditionality effects of the CVM in detail, and

therefore much of this reasoning remains speculative in the absence of systematic research on the

subject.

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CONCLUDING REMARKS

Political corruption remains a significant issue in Bulgaria both in the views of the

domestic Bulgarian public, and according to CPI statistics (see Appendix Table 1). Despite the

large scale anti-corruption campaign launched in the course of the democratization and

Europeanization processes, Bulgaria continues to fail to effectively counter political corruption

(Bulanova, 53). In this literature review, I showed that Bulgaria’s communist era was a period

plagued with political corruption and crony distribution of resources (Holmes, 2009; Ganev,

2013). When communism collapsed in 1989, many anticipated the introduction of good

governance. Scholars anticipated that the collapse of communism would be followed by the

spread of democratic principles, including the rise of a civil society, the overall reduction of

corrupt political practices, and increased accountability and transparency to the public. The

accompanying market liberalization, insertion into international markets, and increased

economic competitiveness were also expected to reduce corruption practices within the ex-

communist republics. As time shows however, scholars who held more pessimistic views

regarding the impact of the collapse of communism upon good governance practices proved to

be closer to the truth. The importation of democracy brought only limited democratic change and

was not sufficient to reinvent longstanding cultural practices held by political officials and by the

public. Privatization created numerous opportunities for asset grabs and for corrupt resource

distribution, while the public remained distrustful of public institutions.

Attempts to reduce corruption intensified when Bulgaria acceded to the European Union.

Scholars anticipated that the EU’s pre-accession conditionality and post-accession verification

mechanism would have sizeable effects on good governance practices in Bulgaria, as the EU

requires candidate members to be on par with European standards. Although Bulgaria’s judiciary

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and public administration systems saw some improvement as a direct result of EU pressure, the

effects of pre-accession conditionality seem to have lost potency since accession has been

achieved. A temporary reduction in corruption was observed in Bulgaria as a result of EU

pressure, but the longevity of this effect is yet to be tested.

The most important lessons we can learn from this review are twofold. The first lesson is

that powerful domestic elites can manipulate periods of institutional reform to their advantage. We

have seen much evidence for this in the period immediately after the collapse of communism when

economic privatization and political democratization were carried out as a ‘clientelistic, internal

coup’ throughout which political elites manipulated power in order to gain personal advantage

(Vachudova, 2009; Haughton, 2007; Noutcheva and Bechev, 2008; Bulanova, 2008).

Consequently, both the economic liberalization and political democratization of the 1990s

produced limited results and artificial reforms, as a direct consequence of the political elite’s

unwillingness to commit to profound reform. More recently, during the period of accession to the

EU, we have seen that powerful elites have taken advantage of the reform process by selectively

implementing some mandated reforms but not others. EU conditionality and the overall EU

accession reform process in Bulgaria were carried out in a selective manner, with political elites

implementing only so much reform as to comply with top-down supranational norms, while

maintaining as much of the old ‘backdoor’ politics as they could (Trauner, 2009; Andreev, 2009;

(Noutcheva and Bechev, 2008; Vachudova, 2009). As Trauner claims, we can observe a

persisting dominance of “old” political elite which signed up for (EU-oriented) reforms in

rhetoric, but not in action (Trauner, 2009). Thus, by selectively introducing compatible norms or

by prolonging the transition period during which the rules of the new system were rewritten, the

predatory elites profited from their stay in office and diverted public resources toward favored

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interest groups and political clientele (Noutcheva and Bechev, 115). This resulted in corrupt state

institutions, mismanagement of the economy and partially reformed polities (Noutcheva and

Bechev, 115). In other words, political elites managed to transform corruption practices in

Bulgaria over the last two decades to comply with norms institutionalized through the political

democratization and accession to the EU, but they did not display sincere commitment to reform

(Ganev, 31).

The second main lesson that we can take away from this literature review is directly linked

to the first lesson, and it is that when mandated reforms are not clear enough, it is relatively easy

for political elites to take advantage of the reform process. For example, neither political

democratization nor accession to the EU provided clear and specific administrative and judicial

models to be followed in order for Bulgaria to transform its public administration and judicial

sectors into functioning transparent bodies (Noutcheva and Bechev, 128). While political

democratization left administrative practices in a chaotic state, the European Union could do

little in providing Bulgaria with sufficient guidance for this sector. Although the judiciary saw

some successful reforms, including three sets of constitutional reforms to solidify its

independence, to this day the Bulgarian judiciary remains politically dependent and inefficient at

persecuting and sentencing corrupt officials (Noutcheva and Bechev, 128). The entrenched

sociopolitical structures continue to hinder complete success in the judicial sector, with

persecution and sentencing of corrupt political officials being limited and ineffective (Noutcheva

and Bechev, 128). Thus, much evidence exists that in areas (such as public administration and

the judiciary) where transformational processes do not mandate clear, specific and tangible

reforms, political elites are at liberty to maneuver and to utilize these transformational processes

for their own advantage. In sum, the second lesson that we can take away from this literature

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review is that when mandated reforms are not clear and specific, it is easy for political elites to

manipulate the reform process.

Two questions which remain unanswered in the literature and may require further

attention are: a detailed evaluation of the effectiveness of the post-accession Cooperation and

Verification Mechanism (CVM) and the progress and evaluation in the area of administrative

reform. First, in terms of the CVM, many scholars have expressed the anticipation of a negative

outcome and a limited effectiveness of the CVM. Yet, aside from media articles, little scholarly

critical pieces have been written evaluating the observed effects of the CVM upon political

corruption in Bulgaria. Second, there is a significant gap in the literature regarding

administrative reforms in Bulgaria, possibly because public administration practices are largely

chaotic and difficult to observe. Also, the fact that administrative reform is a ‘grey’ area within

the EU’s ‘acquis communitaire’ renders the measuring of reform in this sector relatively

challenging. Thus, more scholarly attention is recommended on the topics of CVM effectiveness

and administrative reform for a more complete overview of corruption reform in Bulgaria.

In closing, with this paper, I attempted to understand why the processes of political

democratization and Europeanization produced limited results in reducing corruption in

Bulgaria. The puzzle that was the focus of this paper can be summed up as ‘why two major

transformational events, which are typically accompanied by successful corruption reform, have

not produced the same results in Bulgaria?’ The final take away points in response to this puzzle

are [1] when political elites are interested in pursuing their own advantage they may skew the

process of institutional reform and [2] lack of specific, clear reform allows for political elites to

do so. The lessons learned in this literature review can be applied to the future EU rounds of

accession. Currently, there are six ex-communist Eastern European republics which politically

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democratized and economically liberalized at the same time and through a similar process as

Bulgaria. Also, like Bulgaria, these republics are strongly incentivized to become part of the EU

and have posed their candidacy for accession. The ex-communist republics currently in line for

EU accession are: Albania, Bosnia and Herzegovina, Kosovo, Macedonia, Montenegro and

Serbia. Should these republics be accepted in the EU, they would make up roughly 4% of the

total EU population (Agence Europe, 2008). Like Bulgaria, these republics struggle with political

and administrative corruption and unfair distribution of resources. Thus, in applying the lessons

learned through this literature review, it is advisable to adopt a more critical view when

anticipating the success of EU-lead corruption reform in these future candidates. In other words, we

must attempt to curb our enthusiasm and to view future EU enlargement to the east with increased

scrutiny. I recommend for the European Union to mandate very clear and specific reform goals for

these future candidate countries. Likewise, I would recommend for the political elites in those

countries to display sincere and sustained commitment to the reform process as tangible results

in reducing corruption require profound domestic commitment to change.

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APPENDIX

Table 1: Corruption Perception Indices of EU Members and Candidates

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Table 2: Pre-accession and post accession conditionality of Hungary, Poland, Czech & Slovak Federal Republic, Czech Republic, Slovakia, Latvia, Lithuania, Estonia,

Slovenia, Bulgaria, Romania

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Table 3: Collapse of Communism Timeline

1989 Winter

Todor Zhivkov, Bulgaria’s dictator for over 35 years resigns as Communist Party leader. This event marks the collapse of communism in Bulgaria.

1989 Spring

Former communist party is restructured under the name Bulgarian Socialist Party (BSP)

1990

Spring

BSP resigns after opposition parties refuse to join coalition until free elections are held. BSP wins first free, democratic elections.

1990

Spring

Process of privatization begins. Bulgaria’s most powerful conglomerate MultiGroup is formed. Board of directors include many former high-ranking government officials

1990

Fall

Zhelyu Zhelev, a communist era dissident, founds a new party called Union of Democratic Forces (SDS)

Name of country is officially changed from “Peoples Republic of Bulgaria” to “Republic of Bulgaria”

1991

Winter

Bulgaria adopts Article 8 of its Constitution, stipulating that ‘State power is separated into the legislative branch, executive branch and judicial branch’ – a separation that did not exist during communism

1991

Spring

First Parliamentary elections held under new constitution; SDS wins a plurality of seats

1992 SDS-led government collapses; BSP replaces failed cabinet

1994 BSP cabinet also collapses and President dissolves the government. Parliamentary elections are held. BSP wins election with a majority of seats

1997 SDS wins elections with a large victory, forming the first post-communist government that did not collapse and managed to carry out a full four year term until 2001.

Sources: (Thomson-Reuters, 2007) (Frison-Roche & Sodev, 72) (Sokhey and Yildirim, 2013)

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Table 4: Bulgaria’s Road to Accession Timeline

1990: Grand National Assembly of Bulgaria passes a resolution expressing the country’s will to become a member of the European Community.

1993: The formal transformational process begins in Copenhagen, where the formal accession conditions are set.

1995: Bulgaria receives 476.5 million euros from the EU in aid through the PHARE program aimed at assistance for economic restructure

1997: Bulgaria fails to Meet Copenhagen Criteria. Five other states from the CEE region are invited to begin negotiations

1999: Bulgaria, Latvia, Lithuania, Romania and Slovakia are invited to start accession negotiations at the Helsinki European Council

2004: Ten post-communist CEE states are accepted into the EU. Bulgaria and Romania are not accepted yet

2004: Bulgaria completes the accession negotiations of the thirty-one chapters or 80,000 pages of the EU acquis

2005: Accession Treaty with Bulgaria and Romania is signed. In June the Commission sends a “yellow card” to Sofia and Bucharest complaining about the “insufficient speed” of reforms

2006: Bulgaria is strongly recommended to “seriously intensify its efforts to crack down on organized crime and corruption” (May 2006 Monitoring Report), yet the Commission recommends accession on 1 January 2007 for both Bulgaria and Romania, with CVM and Postponement clause provisions

2007: Bulgaria and Romania become officially join the EU

Sources: (Brussels: EuropeanCommission, 2006) (Smilov 2006, 162-163). (Noutcheva, 2006, 118, 123-124). (Haughton, 238)

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