NATURE VENTURE

When foreigners consider buying a holiday home in Bulgaria, usually their main concerns are price, location and possible investment return. Very few of them are aware that purchasing a property of high quality for a reasonable price and with a good property management contract still does not mean they have made a sound investment. Not knowing much about Bulgaria, buyers often rely on the facts and promises contained in promotional materials and invest in properties which are sometimes illegally built in protected areas.

Such a sad case is a new holiday complex, which is being built near Varvara village on the Black Sea coast. The beautiful countryside surrounding the complex and the affordable prices lured some 100 foreign investors to buy apartments in this attractive holiday development long before the construction was completed. To their shock, it turned out that the property was being built within the Strandzha Nature Park without any permission from the park authorities and in breach of several laws. The developers were ordered to stop construction work in February 2006. Instead, they continued until November 2006, when the Bulgarian Administrative Court suspended the developers' actions. It is possible that the complex will be demolished. Whether or not the buyers get their money back remains to be seen.

Luckily, such situations rarely occur on the Bulgarian real estate scene. Still, foreign investors should always bear in mind that they may be wasting their money on properties built on protected territories. The whole confusion around protected areas grows even bigger now that Bulgaria is joining the European Union program “Natura 2000”. By definition, Natura 2000 is an EU-wide network of protected areas established with the aim of assuring the long-term survival of Europe's most valuable and threatened species and habitats. However, the program is not a network of parks and reserves where all human activities are banned. The authorities explain that each proposed, new initiative or development within Natura 2000 sites must be judged on a case-by-case basis. There is a clear procedure for assessment and subsequent decisions relating to development proposals that are likely to have an impact on designated sites. The program is going to cover approximately 25 percent of the territory of Bulgaria.

The problem is that so far the authorities have not publicly explained or clarified the so called “clear procedure” for assessing plots of land included in Natura 2000, which became the reason for a series of angry debates between landowners and the authorities. Owners of Natura plots suspect that this program is going to turn into a corrupt practice, since the decisions whether construction is allowed or not will be made by a committee. Rumour has it that the otherwise useful program may reduce competition among building companies by excluding the less “influential” ones from the market.

Despite the inconvenience which Natura 2000 is probably going to cause the owners of plots included in the program and the unclear criteria for permitting construction work in restricted areas, it is high time the Bulgarian authorities did something to stop the wild construction work all over the country. The Bulgarian countryside must be preserved and nobody has a reasonable argument against that. A stricter control over where and how developers build their projects will have a positive effect on the investment climate in the
long run, too.

First of all, foreign investors come into Bulgaria mainly because of the country's unspoiled and unique countryside – everything else they have in their own countries. Second, certain limitations of the areas where building is allowed will inevitably increase prices of land and consequently of the real estate properties, as oversupply will no longer be an issue. In addition, although now the list of the selected protected areas seems like the best kept secret in the country, information about them can be found on the Internet site of several ministries and can also be obtained in most local municipalities. It means that potential investors will have access to all the information they need about every plot they wish to buy.

At the end of the day, the efforts of environmental organisations to preserve the Bulgarian countryside and Natura 2000 may turn from a curse to a blessing. The country still has plenty of attractive areas worth investing in. The only thing potential investors have to do is ask the local authorities a couple of questions about the property they plan to invest in.

Taming Wildlife

According to the Bulgarian Biodiversity Act, the Ministry of Environment and Waters (MEW) is the institution responsible for the establishment and coordination of Natura 2000 in Bulgaria. Therefore, departments of MEW should be able to answer investors' questions and to refer them to competent local authorities.

Pan-European Woes

Natura 2000 is an issue not only in Bulgaria. France was ordered by the European court to pay 20,000,000 euros to the European Commission for violating Natura 2000 directives. The EU response to failure in fulfilling the pre-accession Natura 2000 commitments was similar in Spain and Germany. Poland may soon face suspension of the cohesion and structural funds for environment and agriculture and enormous fines and taxes amounting to millions of euros.

Demolish Irakli

The battle of the Bulgarian civic organisation “Let's Save Irakli” against building the Riverside Village in Irakli on the Black Sea coast, has been going on for more than two years. In 1994 the area was declared a protected territory by the government. Environmentalists explain that Irakli is a habitat of crucial importance for Bulgarian wildlife and should remain undamaged by construction works. Recently, the Riverside Village project was suspended for a year.