[Chapter-delegates] Formal investigation against Microsoft deal in Bulgaria

[Dessi Pefeva]

Dear all,

You have already seen some information about this "deal" before, but 
here is today's development:
http://blog.veni.com/?p=512



Bulgarian Prosecutors launch formal investigation about Government deal 
with Microsoft

The prosecution office of the Bulgarian capital Sofia has launched a 
formal investigation about the contract Bulgaria has signed with a 
Microsoft distributor for the acquisition of software for the needs of 
the state administration.

The investigation is based on collected data and proofs in a preliminary 
probe, made by the police. It aims at "unnamed public officials", 
according to Sofia city prosecution spokesperson Steliana Kozhouharova, 
as quoted by the Bulgarian influential 
<http://www.dnevnik.bg/show/?storyid=521068>Dnevnik daily.

I've <http://blog.veni.com/?p=389>blogged about this dirty deal in 
details in December 2007. In short: the price, paid for the software (by 
the way, well in advance - 6 months before the beginning of the 
contract; the distributor said that he'll keep the money "in a Bulgarian 
bank" thus making sure he contributes to the financial system of the 
country /sic!/) is much higher than the price of the same software in 
the shop. The average computer shop in Bulgaria sells the software for 
half the price, paid by the government. Considering the fact, that in 
such huge cases, Microsoft usually gives high discounts, it is 
interesting to see what the prosecution has found in its preliminary 
probe in order to file a formal investigation.
The distributor - CAPK "Progress" (a remnant from communist time, as it 
was found well before the changes in Bulgaria, and to some sources 
considered as a company, organized by the former State Security) has 
offered price of Leva 68 760 000 (approx: Euro 34 M; 1 Euro is equal to 
1.95 Bulgarian Leva by law) for 60 000 licenses for PC and Leva 2 674 
100 for 2000 licenses for server operating systems (OS). With the 20 % 
VAT the total amount reaches Leva 85,7 M or almost Euro 44 Million.

[Minister of State Administration] "N.Vassilev, who has come under 
strong public criticism for signing the deal, refused to comment on the 
prosecution inquiry, telling Dnevnik he had not heard of any probe".

Microsoft has been blamed publicly for bringing corruption to the 
emerging markets, most recently in Budapest, Hungary in May this year, 
when Steve Ballmer <http://blog.veni.com/?p=485>was egged while giving a 
speech at the university.
The U.S. company was also <http://blog.veni.com/?p=450>fined by the 
European Commission with record Eur 899 M in February, that after some 
more fines ranging in the hundreds of millions Euro in the previous years.