Saturday, April 14, 2007

A paper that I recently wrote for my Business Ethics class

Conflict of Interest in Bulgaria


This paper discusses the way conflict of interest is treated by civil servants and common people in Bulgaria. It is a fact that a majority of Bulgarians lack knowledge on the subject. Those who have exploit their advantage over the ignorant, and conflict of interest lives and propagates freely in Bulgaria. The main reasons for this are the mindset of government officials as oriented towards personal benefit, the indifference of common people and the absence of suitable active legislation.

My interest on the subject was raised by an online media article describing a situation of a conflict of interest. According to the article, the Government Payment Agency at the Ministry of Agriculture that has rented an office that is owned by a member of one of the governing parties. The agency has prepaid the rent for a period of one year. The article further says that the director of the agency has been dismissed from his position on account of signing an unprofitable contract for the Government and, beyond his powers, prepaying the rent. As a comment on the situation, the Minister of Agriculture Nihat Kabil argues that he would not void the rent contract because he does not want to send the Government Payment Agency out to the street. He also states that he does not see a problem with the fact that the office is owned by a government official given that the building has been approved in advance and there is a valid contract.

According to the description of conflict of interest by Michael McDonald, a conflict of interest is “situation in which a person, such as a public official, an employee, or a professional, has a private or personal interest sufficient to appear to influence the objective exercise of his or her official duties.” The situation described in the online media article very well fits the given definition. The location for the office rented is owned by a government official. He is appointed to work for the people and is benefiting from his position. This personal benefit suggests a possible lack of objectivity of the decisions that this person makes. His actions may be such as to benefit him and not the people that he represents, which is a classical example for a conflict of interest.

The reason why this paper concentrates on conflict of interest among public officials is the influence that such people have. The conflicting interest of the coworker who is stealing a pen per week from the company property is not as important as the CFO’s weekend meetings with the competition. The decisions of the CFO can influence a lot of people to a great degree, whereas the action of the coworker cannot. In Bulgaria, there are few huge home-based companies, except for the ones owned and operated by the state, so the public interest is mainly pointed toward government officials. The issues of conflict of interest are more relevant to the domain of civil servants for a small country like Bulgaria.

No adequate civil reaction to the comment of Minister Nihat Kabil followed in any online media that I read regularly. The main reason for people’s impartiality is the lack of civil community. Bulgaria has been communist for around forty-five years. The values that have been nurtured during this period are those of obedience and belonging to a group. Things changed with democracy, however. The groups that existed during the communism dissipated and people had to look after themselves. A very common phenomenon in pre-communist societal groups was people helping each other and thus benefiting by being part of a group. In post-communist Bulgaria, this support was no more applicable as people did not have the same privileges as they became employed by private parties. The shared benefit was no longer possible and everyone had to look after themselves. The group that had existed and become strong with time was split. The new groups had to be centered on something else – the immediate benefit. The lack of the strong community creates indifference. This can clearly be seen from the fact that there are no reactions to articles that provide straightforward evidence of the conflicting interests of officials. Of course, to some extent, this can be caused by the fact that a lot of people are ignorant and do not understand the issue, however, there are many who do. And they do not object to the problem.

It is a common fact that many Bulgarians are dissatisfied with the current state of affairs in Bulgaria. There are, however, very few who are willing to put efforts and do anything about it. The reason for this is indifference and a tendency of obedience that has propagated since communist times. If the community nurtured strong relations among individuals, people would be able to make a strong claim against anything that they do not agree with. When they are alone, they often think: “I see a problem here, but what can I do? I am alone in this.” A strong community is powerful enough to have influence over state institutions and even governments. A Strong community can use its power of many to propagate ideas, opinions and to change the order as it sees fit.

The second very important reason for the inadequate reaction to conflict of interest is the way Bulgarian civil servants think and act. It is true that many of them do not have the knowledge of the situations, but there are facts that show those who know are a prevailing majority. In the first place, there are laws and regulations that contain provisions about situations of conflict of interest. A very good example of this is the Civil Servant Act. As a very distinct example of officials’ awareness is a recent article in the mediapool.bg online media that covers the relieving of a member of the local government belonging to one of the ruling parties because of a conflict of interest between his state office and his executive position in one of the community hygiene companies in Plovdiv. These two arguments prove that a significant amount of the civil servants must be aware of the situations of conflict of interest. There are examples to the contrary, though. In their paper “Understanding ‘Conflict of Interest’ in Post-Communist Poland,” Piotr Korys and Maciej Tyminski describe the fact of civil servant’s lack of knowledge on the subject and their excuse of such situations with claims like: “I don’t see anything wrong in something that is legal.” There are similar examples in Bulgarian media, where Nihat Kabil and the Minister of Internal Affairs Rumen Petkov make similar comments.

If, however, these government officials do not have an idea of what conflict of interest is, this reveals their incompetence and state of detachment from public affairs. These all lead to a different argument for the same fact – government officials are not doing their job well. In both cases – whether they understand the issue, or lack the knowledge, they are not performing as appointed.

Last but not least, conflict of interest is regulated in Bulgarian law only partially. There are provisions in the Civil Servant Act stipulating that a public servant may not be in a situation of conflicting interests. It turns out, however, that there are no laws that determine any penalty for those officials who have broken the rule. A very clear proof of this comes again from the media. Very recently there was an article in newspaper “Sega” that describes a rejection of draft amendments to the Civil Servant Act, designed by Philip Dimitrov on the penalties for officials in conflict of interest. The article also states that there were a number of rejections of the same project since its first proposition two years ago.

According to the unofficial opinion of Professor Philip Dimitrov – Adjunct Assistant at the American University in Bulgaria opponents to the existence of such a law would say that people who want to take personal advantage from their position and abide by the law can do it with the help of friendly individuals. To an extent, there are cases of such practices in Bulgaria, but they are insignificant in numbers and by no means a tendency. This is related to the weak groups in society and to the lack of trust among people in the period of “post-communism”(Korys, Tyminski). Professor Dimitrov says that the existence of a law that regulates the penalties for people in conflict of interest will decrease their number, because those who practice it will be liable under the regulations. The lack of these rules in present, allows such conflicting practices without a clearly defined punishment.

The rejection of the project of Philip Dimitrov clearly proves that the members of parliament know what conflict of interest is. The state of Bulgarian legislation at the moment allows state officials to be in possible conflicts of interest, and their objective judgment to be challenged. Their refusal to accept punitive measures prove that they consider the current situation better than a situation in which measures could be righteously enforced. This means that they want this to remain unregulated. This state of the law allows for a considerable amount of corruption as well, because the many of the conflicting interest situations lead to corruption.

The fact that conflict of interest can remain unharmed in Bulgaria means that the state and the governing system are not strong enough to fight it effectively. The reasons for this are related to the main arguments of this text - public officials’ and common people’s mindset and the lack of punitive legislation. According to Professor Dimitrov, the fact that the fight with one of the aspects of conflict of interest – corruption is done in an open manner has made people impervious to it. He says Bulgarians are used to hearing about corruption; for this reason, they have started to take it for granted. Any hard law that fights corruption behind the scenes would aid people on the way of restoring the trust in the governing powers.


Works Cited

1. Korys, Tyminski. Understanding “Conflict of Interest” in Post-Communist Poland.
2. „Новини.” Dir.bg. 8 April 2007
3. Michael McDonald. “Ethics and Conflict of Interest”. dotLRN 12 April 2007
4. Левицата отзовава свой съветник в Пловдив”. Сега. Issue 68. 22 March 2007: page 3
5. „Новини.” Dir.bg. 8 April 2007
6. „mediapool.bg: Румен Петков зашити евтиния апартамент на полицейския шеф.” mediapool.bg. 12 April 2007 < storyid="127710&srcpos="6">
7. Art 29 a, Civil Servant Act, promulgated in Bulgarian State Gazette as of July 27, 1999
8. „Депутатите си запазиха шуробаджанащината”. Сега. Issue 80. 05 April 2007: page 3
9. AUBG. “American University in Bulgaria” 12 April 2007

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