Reforming Bulgaria's Arms Trade

A Human Rights Watch Backgrounder

For the last two years, the government of Bulgaria has pledged to control the country's notorious arms trade as part of its strategy to join the North Atlantic Treaty Organization (NATO) and the European Union (E.U.). Sofia has taken important steps toward reform, but further improvements are urgently needed to ensure that the legacy of irresponsible weapons dealing is put to rest.

Human Rights Watch has long been concerned about Bulgaria's role in weapons supplies to human rights abusers. In recent years Bulgaria has been repeatedly implicated in weapons shipments to governments and armed opposition groups known to commit gross abuses of human rights and violations of international humanitarian law, as well as to regions plagued by violent conflicts and countries under international or regional arms embargoes. Bulgaria's involvement in troubling arms deals has run the gamut from government-approved weapons transfers to illicit arms deals facilitated by private actors. These private actors include arms brokers and transport companies that the government has failed to monitor and rein in. Much of the arms flow from Bulgaria consists of small arms and light weapons produced by state-owned companies. The government has also sold a considerable amount of surplus heavy weapons from its arsenal, largely inherited from its Warsaw Pact days.  
 
The current reform-minded government, elected in 1997, says it has tried to reverse Bulgaria's reputation as an anything-goes weapons bazaar by promising to respect international arms trade standards. For example, Bulgaria has joined the Wassenaar Arrangement (WA) of arms exporting countries that have agreed to exercise transparency and restraint in the international weapons trade. As an E.U. associated country, it also has agreed to abide by the E.U. Code of Conduct on Arms Exports. The E.U. Code sets rigorous standards for arms transfers, specifying, for example, that governments should refuse to authorize arms exports to human rights abusers, areas of violent conflict, or countries that might retransfer the weapons to unauthorized third parties. Furthermore, the Bulgarian government has promised to introduce legislation to tighten national controls over the arms trade and bring them in line with model international standards.  
 
Arms Transfers  
While welcome, these political commitments have not yet been matched by real reforms. Since joining the WA and pledging to adhere to the E.U. Code, Bulgaria has approved deals that violate the spirit of the WA and directly contravene the provisions of the code. For example, in late 1998 it agreed to sell tanks to Uganda, where the equipment might exacerbate multiple internal armed conflicts in which all sides have committed serious human rights abuses. Alternatively, past experience suggests that Uganda may use the tanks to support its troops fighting in the Democratic Republic of Congo (DRC) or divert them to rebels it supports in Sudan, which is under an E.U. arms embargo. Either scenario raises serious human rights concerns.  
 
In 1998 Bulgaria also supplied both sides in the Ethiopia-Eritrea border conflict, which has led to large displacements of civilians in both countries. Several planeloads of Bulgarian weapons were delivered to Eritrea the same week Bulgaria signed on to the E.U. Code, in early August 1998. Later that year the government approved a sale of surplus tanks to Ethiopia. These transfers contradict Bulgaria's promise under the E.U. Code not to supply weapons that might "aggravate existing tensions or conflicts" or "affect adversely regional stability."  
 
Equally troubling, the draft Bulgarian arms trade law has been in limbo since last December, when the version approved by the cabinet was withdrawn for further revision. After a long delay, officials are expected to unveil the new draft in time for U.S. President Bill Clinton's state visit to Sofia, scheduled for November 21-23. The planned release of the revised draft, and the subsequent adoption of a new arms trade law by parliament, is intended to mark concrete progress toward reform.  
 
Flaws in the Legal Controls  
The government's success in its reform effort depends largely on whether it uses this unique opportunity to address important flaws in the existing legal framework for approving arms deals. Bulgaria's arms trade law, for example, does not currently bar weapons transfers to forces that have been responsible for gross human rights abuses and violations of international humanitarian law, nor to countries suspected of diverting or retransferring arms to unauthorized third parties. Similarly, the country's international commitments under the E.U. Code and other nonbinding agreements, as well as its obligation to adhere to U.N. arms embargoes, are not reflected in the current law. Furthermore, existing Bulgarian law does not account for the considerable "gray market" trade in weapons, whereby licensed arms deliveries are diverted or resold to unauthorized parties, often with the collusion of Bulgarian arms brokers, transport agents, or others.  
 
Beyond these policy gaps, poor enforcement of applicable domestic controls has accounted for much of the problem with Bulgaria's arms trade. Arms deals in Bulgaria are subject to a two-step review process, whereby companies must obtain a license to trade in weapons and then must request permits for each arms transaction they pursue. This system, while strong on paper, unravels when it comes to implementation. For example, in a direct conflict of interest, some of the government officials responsible for oversight of the arms industry simultaneously serve on the boards of directors of arms companies, where they earn a modest salary and stand to receive bonuses if the company does well.  
 
In addition, Bulgarian licensing authorities have not consistently verified the accuracy of all documents presented, including the so-called end-user certificate (EUC) that specifies who is authorized to receive the arms shipment and that binds recipients not to retransfer the weapons without prior approval. EUCs are easily forged to conceal the identity of the intended recipient, who may be subject to an arms embargo. Although Bulgarian officials recognize that such deception is common, they have historically done little to authenticate EUCs or monitor the delivery of arms shipments to ensure that they are not diverted to unauthorized parties.  
 
Signs of Progress?  
It is reassuring that the government has made headway toward improving the implementation of regulatory controls, in part through ongoing cooperation with the US government and the European Union. In the past year officials reportedly have spotted suspicious arms transactions before licenses were approved. Efforts to crack down on rampant corruption, including in the arms industry, have also strengthened enforcement efforts. Furthermore, new customs training programs may help rein in illicit arms trafficking.  
 
Privatization of Bulgaria's arms industry, touted by some as another means to reduce rampant corruption, will not necessarily resolve longstanding problems. In fact, it is unclear how much change it will bring. Five key arms companies that together account for the vast majority of exports will only be partially privatized, with the government retaining thirty-four percent ownership. One of these key manufacturers, Arsenal, was sold in August. Majority ownership of the company, whose Kalashnikov assault rifles and other small arms have ended up in the hands of numerous abusive forces, went to a worker-management group. To date all of the arms companies that have been sold have gone to worker-management organizations. These buyouts mean that many of the same people who helped run arms companies when the industry was involved in questionable arms deals are still in power.  
 
Discarding Surpluses  
Although Bulgaria has long needed to address problems with its arms trade controls, the issue is growing more salient because of the country's push to join NATO. In order to boost its prospects, Bulgaria is modernizing its armed forces by reducing the size of its military and gradually switching to NATO-standard military equipment. By 2004 the country is expected to halve the number of its troops. It also plans to sharply reduce its arsenal, for example cutting the number of tanks from 1475 to 750. This modernization effort threatens to inflate an already-large post-cold war arms surplus, and financial incentives clearly favor disposing of these excess stocks via export. Whereas destroying a thirty-year-old tank and converting it to scrap metal earns the government only U.S.$2,000, the same tank now sells for U.S.$30,000 on the open market. Importantly, exports of surplus weapons bring in much-needed hard currency to help finance the military modernization plan. In January, for example, Bulgaria purchased U.S. helicopters valued at U.S.$8.7 million with proceeds from surplus weapons sales.  
 
Unfortunately, however, the cheap, Soviet-standard equipment Bulgaria is offering for sale is most likely to appeal to armed forces in Africa and Central Asia's war zones that can afford little else, raising the risk that the weapons will be used to fuel violent conflict and commit human rights abuses. NATO members may inadvertently contribute to this problem through their assistance in helping Bulgaria obtain NATO-standard equipment. Bulgaria's procurement of new military equipment from NATO members may displace other equipment and thereby add to the surplus pile destined for export.  
 
Joining NATO and the E.U.  
It is important to encourage all prospective NATO and E.U. members-not only Bulgaria-to adopt laws with appropriate checks that would prevent arms transfers to forces which abuse human rights, are subject to arms embargoes, or which violate the country's international commitments, and to rigorously enforce those laws. Problems with arms trade controls are persistent throughout much of the former East Bloc, including among new NATO members that are candidates for E.U. membership. This year Poland and then the Czech Republic embarrassed NATO allies when they decided to go ahead with plans to sell surplus tanks to Yemen even though they had been warned by the United States government that the tanks might be diverted to Sudan, which is under an E.U. arms embargo. Poland halted further shipments in late August after a shipment of the first twenty tanks went missing and reportedly was delivered to Sudan. The Czech government announced in mid-September that it would go through with its planned sale of tanks "to Yemen."  
 
NATO and the European Union are in a unique position to insist that Bulgaria's arms industry cleans up its act now as a precondition for membership in these institutions. Bulgaria is entering into a new phase of relations with both institutions. The E.U. announced on October 13 that it would include Bulgaria in fast-track accession negotiations beginning in December, and NATO has been pursuing greater cooperation with Bulgaria since the war over Kosovo, during which Bulgaria's support proved valuable. Recognizing the efforts Bulgaria has already made, and using the significant leverage they exercise, NATO, the E.U., and their member states should encourage the Bulgarian government to undertake further reforms. Where appropriate, these institutions and governments also can directly contribute to reform by providing technical and financial assistance.  
 
Bulgaria, for its part, must translate its public commitment to reform into concrete action. In order to earn a new reputation as a leader in efforts to reduce the spread of weapons to human rights abusers, it must:  
 
* incorporate human rights and humanitarian concerns into national arms trade policy;  
* strengthen the regulatory system that so far has allowed shady arms deals to receive authorization and bypass controls;  
* enhance accountability for violations of arms trade laws;  
* improve transparency and thereby strengthen oversight; and dispose responsibly of surplus weapons.  

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