EU-Report Accession Bulgaria

Chapter 25: Customs union

Since last year's Regular Report, Bulgaria has made some progress in this field.

As regards alignment of Bulgaria's legislation with the customs acquis, no new developments can be reported, but Bulgaria had already achieved a high degree of legislative alignment.

The 2002 customs tariff adopted by Bulgaria is in compliance with the changes to the Harmonised System and Combined Nomenclature for 2002. It also includes the changes to the lists of countries (along same lines as those adopted by the EC) to which preferential and MFN rates are to be applied, and changes to MFN tariff rates made in accordance with Bulgarians WTO obligations (see also Chapter 26 ­ External relations).

Concerning administrative and operational capacity to implement the acquis, changes in the senior management of the National Customs Agency took place in February 2002. The need for serious reforms in the customs administration has been recognised. In November 2001, the Minister of Finance brought in substantial outside expertise to advise the government on the reform of customs. As regards strengthening of administrative capacity, there was little progress until March 2002; since then, the situation has improved and implementation of the reforms is progressing. The updated Business Strategy adopted for the period up to 2006 has four key goals: (i) adaptation of customs administration to EC requirements, (ii) strengthening co-operation between the customs administration, economic operators, trade sector and the public, (iii) improving the efficient collection of customs duties and other state receivables within the competence of the National Customs Agency, and (iv) implementing the state customs policy to combat customs offences and currency offences and crimes. Although a financial plan for the strategy has been developed, operational plans should be further developed in order to ensure the achievement of the strategic objectives.

The national strategy against corruption adopted in October 2001 includes specific measures to implement ``Anti-corruption reform in the Customs Agency''. The programme foresees a number of measures, including legislative improvements and strengthening of internal control. The Customs Ethics Code adopted by the Customs Agency became applicable to all officials in July 2002.

The Customs Agency adopted a strategy for the rationalisation of border operations in May 2002. The detailed plan of activities for implementation of the objectives and tasks included in the strategy was also approved.

Since the beginning of 2002, administrative instructions have been developed to provide detailed rules on the implementation of customs legislation in some areas. A Customs Consultative Council has been established. It will provide a forum for exchange of information and serve as generator of advice and assistance to the Minister of Finance and the Director General of the Customs Agency.

An updated IT Strategy has been developed, but a six-month delay has accumulated in the development of the Bulgarian Integrated Customs Information System (BICIS).

Overall assessment

The adoption of the Integrated Customs Tariff for 2002 introducing the changes to the EC Combined Nomenclature is an important achievement of the Bulgarian administration in its efforts to adopt the acquis. The introduction of this new instrument will simplify customs procedures and make the tariff more transparent for economic operators.

The adoption of the national strategy against corruption and the programme for its implementation, including specific measures to implement ``Anti-corruption reform in the Customs Agency'' shows a significant commitment by the government to tackle the issue of corruption.

The development of the Bulgarian Integrated Customs Information System (BICIS), which had previously been progressing well, suffered as a result of staffing, organisational and financial problems related to the development of the integrated system. However, if current progress is sustained, a satisfactory level of IT operational capacity should be achieved by the Customs Administration in the medium term.

Customs control should be improved when the mobile teams foreseen become operational. Further strengthening of co-operation with customs authorities of neighbouring countries is required.

Conclusion

In its 1997 Opinion, the Commission concluded that the Bulgarian Customs Administration was in the process of reorganisation and that it would be necessary to align the organisation to the duties that had to be carried out by a modern customs organisation. Low salaries made it difficult to recruit staff. The Commission concluded that it seemed unlikely that Bulgaria would be ready to fulfil the responsibilities of an EC customs administration within the next few years.

Since the Opinion, Bulgaria has made steady progress achieving a high degree of legislative alignment, but progress on development of operational and administrative capacity has not kept pace with this and further work is necessary, especially in terms of implementation and enforcement.

Negotiations on this chapter have been provisionally closed. Bulgaria has not requested any transitional arrangements in this area. Bulgaria is generally meeting the commitments it made in the accession negotiations in this field.

Bulgaria should focus further efforts on continued implementation of the business strategy, which is of great importance with a view to ensuring the necessary administrative and operational capacity to implement the acquis. Bulgaria needs in particular to focus on further alignment with the Community customs acquis, strengthening information technology and human resource policy, as well as on completing major projects on revenue collection, transit control and risk analysis. Moreover, in order to complete customs reform, Bulgaria needs to improve human resource management in customs and ensure it has a stable and professional body of staff and management. The percentage of staff with civil servant status should increase to align the Customs Agency with best practice in EU Member States. Bulgaria also needs to prepare for the application of measures and provisions that will be introduced only at the time of accession.

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