Central Europe Review: politics,
society and culture in Central and Eastern Europe
Vol 2, No 11
20 March 2000

TV in the 21st Century B U L G A R I A:
TV Commercials:
Bulgaria Licenses Its First Private National TV Operator

Assia Ivantcheva

Bulgaria's broadcasting policy is full of paradoxes. Bulgaria is the only country in the region, along with Hungary, which was invited officially to join the European Commission's MEDIA II program in recognition that its electronic media legislation is in tact with European Union standards. Yet, unlike most of the other countries in Central and Eastern Europe (CEE), Bulgaria has not had a private TV operator on a nationwide scale over the last ten years. Finally, when the licensing procedure was initiated in the end of 1999, Bulgaria handled it differently from Hungary, Poland, Romania, or Ukraine.

In Bulgaria licensing is governed by two laws and two regulatory bodies. Terrestrial television activity is split into the so-called "radio and television activity," governed by the 1998 Radio and TV Act 1998 (RTA) and the actual act of broadcasting, viewed as a telecommunication activity under the 1998 Telecommunications Act (TA). Such a division is inappropriate for terrestrial TV where the same entity owns and broadcasts the programs. The division in the Bulgarian case was quite confusing for the broad public and even for the regulators. More importantly, it was used to allow government officials to make the final decision about whose voice will be heard nationwide and whose voice will be silenced.

Faced with excessive state interference, both the participants and the observers in the Bulgarian licensing 'drama' considered a foreign investor to be the best alternative and offered their support for R. Murdoch's News Corp. [1] This resulted in another paradox: professional and civil society groups took the same side as the regulators in welcoming a foreign corporate giant, without critical discussion of the potential threats that its entry poses.

The legal "puzzle"

As the applicants for the first commercial TV in Bulgaria had to comply with two laws - the 1998 RTA and the 1998 TA, they needed to apply for two licenses: one for the programs and one for broadcasting them (the telecom license). The National Radio and TV Council (NCRT) is the body, which determines who would get the programming license. Technically speaking, it reviews all applications and then provides the State Telecommunications Commission with its positive or a negative decision on the programming part, along with a draft text of the license. Then, STC takes a month to issue the license (RTA, Art.111-115).

The law makers argue that as a public body NCRT does not have the right to perform the actual issuance of the license. Yet, there are quite many cases in other European states -- France, Poland, Germany --- where the media councils do make the final decision on licensing. In his comparative analysis about the role of the media councils in Central and Eastern Europe, K. Jakubowitz argues "that broadcasting regulatory authorities which do not (1) issue secondary legislation, (2) award broadcasting licenses, (3) oversee public service broadcasters, or (4) appoint their top governing bodies, do not play a role of major importance." (Jakubowitz, IJCLP, Issue 2, Winter 1998/99, p. 23). The fact is that in Bulgaria, NCRT does not award television licenses, even though it plays a decisive role on evaluating the programming proposals.

The bigger issue is that the program license by itself can be of little use, in case the applicant is not granted the permission to broadcast the approved programming. The latter caused various speculations in the Bulgarian press: what if the candidates awarded program licenses do not coincide with the ones given the telecommunications one. Theoretically, such a paradoxical outcome was perfectly possible, provided the lack of coordination between the various agencies involved.

In accordance with the Telecommunications Act (Art.43 and 44), the State Telecom Commission proposes to the Council of Ministers (CM) to declare a tender for selecting a national commercial broadcaster. In the end of July 1999, on the basis of such a request the Council of Ministers announced a tender for the "construction, support and use of telecommunication network and television broadcasting of national coverage"(CM Decision No 559). Also, in accordance with the Telecom Act, the Prime-Minister appointed the members of a State Evaluation Committee, which decided on the final outcome of this tender (TA, Art. 45). The Committee included members from the STC and NCRT, as well as a representative from the Ministry of Defense, Ministry of Internal Affairs, Ministry of Culture, and the Council of Ministers (CM press release, August 9, 1999). This Committee was to decide who would get the telecommunications license, and then the Council of Ministers was to approve it, so that finally the STC could issue the license (TA, Sect. II, Art.47(1)).

Thus, the licensing of the first commercial TV operator in Bulgaria has been decided by the Council of Ministers and the State Evaluation Committee comprised of government officials and appointed by the Prime Minister. This is a clear illustration that in Bulgaria politicians and bureaucrats still have too much power over electronic media, which could lead to transgression of the democratic principle of independent media. The only body, which claims to defend the public interest -- NCRT-- played only an indirect role in the licensing process.

While the members of the STC are appointed by the Prime Minister, the members of NCRT are elected by the Parliament and the President on a special rotation principle. The election procedure for NCRT has been an issue for Parliamentarian and public debate over a long period of time. Finally, a compromise was reached between various NGOs fighting to media's democratization and the political party in power (first BSP and then UDF). The "battle" over NCRT was finally solved by the President, who vetoed the daft of the Radio and TV Act and suggested a more inclusive procedure, which allowed for greater political representation. Ironically, after all this public and political debate in the case of licensing the first nationwide operator, the Council's participation was kind of informal and limited.

A closer reading of the Radio and TV Act shows that NCRT could have played a much more prominent role than it did, had Art. 116 been applied:

In the case where the National Radio and Television Council is of the opinion that for the grant of a license it is necessary to conduct a contest, the latter shall be conducted in accordance with conditions and procedure laid down in an ordinance issued by the Council of Ministers.

In spite of the fact that there has been one frequency, Effir 2, and seven applicants, the National Radio and TV Council did not request the organizing of a contest from the Council of Ministers. Svetlana Bojilova, a member of NCRT and an expert at the European Audiovisual Observatory, also points out that to have the Council of Minister approve all the decisions is anti-constitutional since the media, according to the Constitution, are independent. [2]

Had there been a separate tender, conducted by NCRT, that would have created another problem of who to determine the final winner. Provided there are two tenders, one for programming and one for telecommunications, there is no regulatory procedure which decision is more important. Therefore some of the members of NCRT agreed on having just one contest -- a telecommunications one, guaranteeing NCRT a role in in the overall process. Another explanation given by a NCRT member, Nelly Ognyanova, the author of the Radio and TV Act, is that the NCRT was simply too busy with its manifold tasks to organize its own tender for Effir 2. In the summer of 1999 the Council had 500 applicants for program licensing: national public-service terrestrial and satellite broadcasters, regional cable and terrestrial operators, which all needed the approval of NCRT to continue or start broadcasting of their programs (Interview of Nelly Ognyanova, Capital, August, 1999). However, after waiting for ten years to liberalize the television system, the Council could have played a much more prominent role, provided this licensing concerned one of the three nationwide TV frequencies.

The Players

The tender for the first commercial terrestrial TV operator in Bulgaria gathered an unexpectedly large number of applicants for the comparatively small advertising market of Bulgaria. Seven applicants, both Bulgarian companies and international corporations, applied for both a programming and a telecom license. Following an alphabetical order, the participants were:

  1. Alexandra TV (registered in Bulgaria, with emphasis on films)
  2. Antenna Bulgaria (owned by the Greek Antena TV-- the largest television operator in Greece, established in 1989 immediately after the liberalization of the Greek audiovisual space)
  3. Balkan News Corporation (a subsidiary of Murdoch's News Corp.)
  4. Evrokom Corporation, registered in Bulgaria
  5. Investment Intermediary "Global" -- a partnership among Logic Invest (private co., based in England and Wales), Modern Times Group (Private media co. registered in Stockholm) and Zodiak VN (private Co. registered in England and Wales), with a Bulgarian representative Mr. Kevork Kevorkyan, a prominent TV journalist.
  6. Nova Televisia + First Private Channel, one the commercially-successful regional private television in the country, broadcasting in the area of the capital city, the unofficial government's favorite
  7. TV 2 -- a joint venture between the Scandinavian company SBS Broadcasting and the European Broadcasting Systems (EBS), established with the participation of the European Bank for Reconstruction and Development (EBRD)

To give the Council its due, it should be said that it did make an effort to acquaint the public with the rules for program licensing through regular press conferences and on the pages of its quarterly Bulletin. It also organized public discussions with the three candidates, approved for program licensing, which were open for all those interested in the matter.

The four candidates that were disqualified were: Antena Bulgaria, Nova TV, Evrocom Corp. and Alexandra Film. The program proposed by Antena was targeting only the age groups 25 to 44 years old, presenting mostly regional news; Alexandra TV seemed to offer programming, more appropriate for a specialized film and culture channel than; Evrokom had a weak financial and business potential to carry out its otherwise rich suggested programming.

Especially interesting was the case of Nova TV, which has been regarded as one of the favorites of the Prime Minister. Its application was rejected for a variety of reasons: lack of information on the origin of capital flows and incomes, the limited scope of its suggested programming. Nova's alleged owner Darko Tamidjich, is a Serbian national, has been convicted twice for unpaid taxes and illegal cross-border deals. In addition, shortly before the start of the broadcast contest an alleged partner of his was mysteriously killed, which increased the suspicions about the transparency of the station's capital After NCRT denied Nova's application for program license, the Bulgarian subsidiary of the Greek Antena and Nova united their efforts to get access to the Bulgarian broadcast space. D. Tamidjich sold his shares to Antena, and the two companies applied together for a telecom license.

The three "winners" selected by NCRT for the program license were Balkan News Corp., TV2, and Global. The public discussions with the "winners" of program license took place in Sofia between November 2 and November 5, 1999. Overall, these so-called public discussions resembled company promotions, where each applicant was trying hard to point to its strengths and downplay its perceived flaws. The audience consisted of journalists, TV producers and some media-related businesses. The Bulgarian consumers were conspicuously absent from this important for the whole nation event. The public discussions were announced on the radio, the sessions were open to the public and took place in the Film House (Doma na Kinoto), situated in the very center of Sofia. After the official presentation, the audience had the right to ask all kinds of questions. Yet, it seemed that the Bulgarian viewers, unaccustomed to participation in the forty-five years of socialism and the ten years of transition, when the state continued to exercise monopoly power over broadcasting, did not even think they can in any way influence the course of events.

In fact, they probably could not change any of the decisions already taken, yet their critical questions would have contributed to the creation of a more realistic notion of what the interests of the 3 preliminary "winners" were. Besides, an active and informed viewers' presence could have served as a countervailing force in the dialogue between corporate' representatives and the inexperienced regulators, whose major concern was to conclude the tender as soon as possible.

The most challenging question throughout the public discussions was directed to Global and in particular to their Bulgarian partner Kevorkian, who owns a private radio station: Kanal +. The radio station received a permission to broadcast upon promises for high-quality, culture-oriented programming, but was later began broadcasting only commercialized folk music ("chalga"). In spite of Kevorkian's defensive answers and the quick interference by his foreign partners, the question remained without an answer. It also brought up the more general problem of how licensing requirements could be enforced when there were strong commercial interests at stake.

After the programming part was over, yet before the end of the telecom contest, some of NCRT members made their views known to the public. Svetlana Bojilova, voiced her criticisms of Global in an interview for the most popular daily 24 Hours, which could be regarded as lobbying for the other candidates. The biggest paradox stems from the fact that Ms. Bojilova, a well-known media expert in the country, an Assistant Professor at the School of Journalism, involved with the work of Civil Forum Free Speech, an active media, has become one of the most ardent proponents of Rupert Murdoch's.

Her position reflects the temporary consensus created between journalists, civil society groups and academics, who united behind the idea of breaking up the monopoly of the Bulgarian National Television and the dependence of electronic media on politicians by all means. A strong foreign corporation seemed to be the perfect way out. One can also speculate that both regulators and journalists had a strong personal interest in licensing a big European, or U.S. media corporation, as this would open new professional opportunities for them. For example, the resignation of Ms. Ognyanova from NCRT, immediately lead the press to believe that the underlying reason of such a move was to become a member of the board of Directors of Balkan News Corp. The name of the chief of the government press office, Stoyana Georgieva, is also often mentioned among the potential new employees of the first private channel. Only the future can show whether or not some of the major actors in the licensing "drama" have had strong personal interest in choosing a certain candidate.

The paradoxes of the licensing procedure

This section, which will also serve as a concluding one, argues that the legal framework for licensing in Bulgaria is quite ambiguous and deficient, and could lead to excessive governmental control.

The fate of the telecom license was decided by the State Evaluation Committee, which raised concerns that NCRT's programming decisions will not be taken into consideration. So when it announced, with almost a month delay, that Murdoch's Balkan News Corp. many sighed with relief it was not Nova TV or Global. In fact, the Committe had a list of criteria, of which programming was one-third. Thus no one, who had not passed the first round at NCRT had any real chance for winning the telecommunications tender. However, these were ad hoc created rules for coordinating of the work of the two bodies. There is no real guarantee that they would not change and that NCRT's role would be ensured the same way. Also, the work of the State Evaluation Committee has not been made public until the competition's very regardless of transparency principles.

Another important question is why the technical and the business criteria were held more important than the programming ones. The final decision was left to the Evaluation Committee and the Council of Ministers. They were to choose among the three candidates proposed by NCRT, yet any of them could have been the winner since no official ranking according to program criteria had been performed, in spite of obvious differences in the quality of the proposed projects.

Various media experts have criticized the present situation of having two regulatory bodies, with no formal methods of coordination and hierarchy between them, under two different laws, as inefficient and bureaucratic. By placing the decision making power with the government for determining the outcome of the licensing, the present legislation endangers the creation of politically independent television system, which seems especially dangerous for a nascent democracy like Bulgaria. This was the reasoning behind criticisms expressed by the Group for European Media Legislation, the Center for Independent Journalism, the Council of Europe and independent consultants like the law company Covington and Burling in Washington DC. (Grupata za Evropjesko Medijno Zakonodatelstvo, 1998).

In addition, in the case of the Bulgaria, there was a curious lack of critical thinking in evaluating the big intrenational players. Vicktor Chakarov, writing from London, has been one of the few to alert the Bulgarian public of the potential dangers to Bulgarian democracy associated with Murdoch's entry (Capital, 01/2000). Considering the relations between Murdoch's corporation, the EU, the British government and the BBC, one can conclude that if there is any problem between the Bulgarian government and Balkan News Corp.,. the winner will be the Corporation. Besides, even if Murdoch has to choose between profit-making and democracy, as it was in the case of the Chinese government at the time of the violently-crUshed student demonstrations, surely he will sacrifice political rights at the altar of profit (Chakarov, Capital, 01/ 2000).

At present, it seems that the Bulgarian government is ready to compromise. Although, the representatives of Balkan News Corp. had declared that they were ready to start broadcasting in six months, for some reason the license stretches this period to nine months. Whatever further developments might be, there is a worrisome trend of 'unification' between the government, foreign capital and independent NGOs (previously active in the process of the media reforms), which leaves the Bulgarian viewers quite defenseless. All these developments seem to validate Splavko Splichal's arguments in Media Beyond Socialism (1994). There Splichal concludes that the social change in Central and Eastern Europe involves several paradoxes, such as: the state property is being privatized by the state, under tight political control ("centralized privatization"), the leading principles of transition are economic ("to fill the empty treasury") in spite of the declared political goals; privatization and liberalization of the economy, including media, are erroneously equated with democratization (Splichal, 1994, pp. 85-92).

Research for this article was supported in part by a grant from the International Research & Exchanges Board (IREX) with funds provided by the National Endowment for the Humanities, and the United States Department of State which administers the Title VIII Program. None of these organizations is responsible for the views expressed.

1 Murdoch's Balkan News Corp. is still not the official winner as one of the other contenders, Global, mad a court appeal. Various sources expect that the argument will be finally solved in Murdoch's favor. ^

2 Interview with Svetlana Bojilova taken at NCRT's building, Sofia, Bulgaria, on November 24. ^

Assia Ivantcheva , March 2000



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