Bulgarian MPs reject opposition motion to cancel Sofia Airport concession

Written by on July 18, 2018 in Bulgaria - Comments Off on Bulgarian MPs reject opposition motion to cancel Sofia Airport concession

Bulgarian Parliament voted on July 18 to reject the motion tabled by the opposition socialists, which called for the cancellation of the government tender to pick a private operator for the country’s largest airport in the capital city of Sofia.

Other than the socialists, only MPs from populist Volya, the party with the smallest group in the National Assembly, backed the motion, which received 59 votes in favour, with 95 opposed and seven abstentions.

The motion’s authors alleged that the terms of the concession offer were rigged to tilt the odds towards a specific bidder and would threaten Bulgaria’s national security.

“In the previous administration, there was talk of a Turkish company, now again there is talk of a Turkish company. You know what that means, if a Turkish company wins the tender, [Turkish president Recep Tayyip] Erdogan will not have to ask for the EU to stop issuing visas, they will enter freely,” socialist MP Ivan Ivanov said during the debate, as quoted by Bulgarian National Radio.

Transport Minister Ivailo Moskovski, who attended the debate, said that the socialists were engaged in baseless speculation while rejecting “a perfectly normal economic practice”.

Bulgaria called the tender for the Sofia Airport concession earlier this month – the second time that a government led by Prime Minister Boiko Borissov made such an invitation, with an earlier tender cancelled last year by a caretaker cabinet appointed by President Roumen Radev.

The updated tender requirements feature several major changes compared to the earlier proceedings. The concession period is once again 35 years, but now have an option to extend the period by one third, and the upfront payment was kept unchanged – at least 550 million leva (about 281.2 million euro).

Prospective bidders must have experience operating at least one international airport with an annual passenger traffic flow of at least 10 million people (compared to six million people in the earlier tender).

The annual concession fee was raised to at least 10 per cent of the airports revenues or 15 million leva, whichever is higher. Previously, Bulgaria asked for an annual fee of seven per cent of revenue or 10 million leva, whichever is higher.

Bulgaria’s transport ministry said that the increased fees were based on higher passenger numbers registered by the airport since the previous tender invitation in 2016. Last year, Sofia Airport serviced just short of 6.5 million passengers, an annual increase of 30 per cent, thanks to the continued expansion of low-cost airlines’ operations.

Another major departure is the requirement to build a third terminal at the airport by the end of the tenth year of the concession, thus keeping the old Terminal 1, currently in use mainly by low-cost airlines, in operation.

The previous tender envisioned the construction of a new Terminal 1 with seven jetways, with an annual passenger flow capacity of at least three million people. The new tender also envisions the potential expansion of Terminal 2 and a requirement that the future concessionaire carries out a study by the end of the fifth year to assess whether the airport needs a second runway.

The deadline for binding bids in the tender is October 22 2018.

(Photo: Aisano)

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