The Privatisation Agency is obliged to comply with the Parliament-adopted amendments to the privatisation Act, which are to affect the sale of Bulgaria's tobacco monopoly Bulgartabac.

This transpired at a press conference of Privatisation Agency representatives March 6.

The Privatisation Agency has already asked Consortium Tobacco Capital Partners, 100 percent owned by Deutsche Bank, and Metatabak to confirm the validity of their offers by April 20, 2003. Metabak, one of the three also-rans for Bulgartabac, disqualified by the Privatization Agency, is to submit a deposit of EUR 2,5 M.

In the middle of December a five-member panel of the Supreme Administrative Court (SAC) upheld the cancellation of a deal to sell Bulgartabac to Tobacco Capital Partners (TCP).

Russia's consortium Rosbulgartabac and Austria's Tobacco Holding GmbH, two of the bidders who lost the initial bid for 80% stake in Bulgaria's tobacco giant Bulgartabac, already confirmed the validity of their bids at the end of January, when they were extended by ninety days.

The third candidate, Tobacco Capital Partners, was not then asked by PA to confirm the validity of EUR 110 M bid. The move prompted talks that this could be interpreted as effectively disqualifying the provisional winner in the tobacco sale from the process, heeding the judgement of the Supreme Administrative Court.

The new rules also revoke SAC ruling for seeking sweetened offers.

In accordance with the adopted amendments, the Privatisation Agency is to submit to the Cabinet a report on the content of all offers, submitted within the deadlines of the final stage of Bulgartabac privatisation.

The Cabinet will name the buyer, set the deadline for concluding the contract and its terms.

PA will hold negotiations with the preferred buyer, following the approval of the Parliament. The privatisation contract will be submitted for approval by PA Supervisory Board and the Cabinet.

The amendments to the Privatisation Act will come into effect March 7, after President Parvanov signed the decree for promulgating them March 4.

Opposition MPs are now challenging the changes at the Constitutional Court, which is
instituting a case on the petition. The Court President, Roumen Yankov, will be the reporting judge.

Bulgartabac Holding Company, the Bulgarian Telecommunications Company, seven electricity distribution companies, the Vazov Engineering Works of Sopot, Kintex, Teraton, Balkan Air Tour, the Bulgarian River Shipping Corporation and Navigation Maritime Bulgare are the companies to which the new procedure of privatisation will be applied.

Candidates for Balkan Air Tour sale consultant may submit their proposals no later than March 26. The company's draft strategy will be presented for public discussion next week.

PricewaterhouseCoopers-led consortium, sale advisor of the Bulgarian River Shipping Corporation and Navigation Maritime Bulgare, is to prepare a sale strategy and method by the middle of March.

BNP Paribas-led consortium, the sale advisor of the seven energy distribution companies, is expected to be contracted in the second half of 2003.

The amendments to the Privatisation Act are not to affect the key deal for Bulgarian Telecommunications Company BTC, where a preferred buyer has already been named.