Supreme Prosecutor’s Office: Construction Permits for Wild Beach Are Illegal

Bulgarian fund also wanted to build on “Coral” beach
Екип на Биволъ

The permits of Spanish “Iberdrola Inmobiliaria” and “Prime Property BG” for construction on the wild Bulgarian beach “Coral” have expired and contain significant violations of procedural rules and substantive law, according to the resolution of the Supreme Administrative Prosecution Office (SAPO). It was approached by caretaker Minister Ekaterina Zaharieva in response to citizen protests to save one of the last pristine Bulgarian beaches.

SAPO has made a detailed analysis of the defects in the administrative acts of the municipality of Tsarevo and has come to the conclusion that they do not comply with current legislation. “The preservation and reproduction of the environment, the maintenance and the diversity of living nature are impossible without a reasonable and lawful construction of urban areas in the country,” the resolution further states.

With this decision, SAPO annuls the termination of the case by the Appellate Prosecutor’s Office in Burgas. The probe was terminated in 2013 when it became known that the construction permits have been revalidated, causing a scandal and civil protests. Then, to appease public opinion still outraged by “Dunes Gate”, Minister Lilyana Pavlova referred the permits to the prosecution.

According to the Supreme Prosecutors, the Burgas probe has not been conducted objectively and comprehensively by the District and Appellate Prosecutor’s Office in the city. The latter is given precise instructions to local prosecutors to conduct a new analysis and to appeal before the Court the building permits on grounds of invalidity or illegality.

Who Is Responsible?

Illegal building permits were issued as early as during the term in office of the infamous “red” (Socialist-endorsed – editor’s note) Mayor Petko Arnaudov and before the Black Sea Coast Act entered into force. They were renewed, without a change of their parameters, by the Mayor from the party Citizens for European Development of Bulgaria (GERB) Georgi Lapchev in 2013.

Hopes were pinned on Georgi Lapchev to break with the policies of his predecessor – the destroyer of the Strandza mountain, Petko Arnaudov. For now, however, Lapchev is rather following his example. In addition of supporting and working for the construction on “Coral”, the current Mayor of Tsarevo is obstructing changes in the municipality’s Master Plan under the pretext of protecting the interests of local residents. In fact, he is protecting the interests of two infamous individuals – architect Kalin Tiholov and lawmaker Yordan Tsonev from the party representing mainly the Muslim minority in Bulgaria – Movement for Rights and Freedoms, DPS, nicknamed “Dancho the Fraud”. As Bivol revealed, they are the main beneficiaries of the scheme to appropriate huge waterfront properties through false inheritance power of attorney documents, fabricated by five Burgas lawyers. Once the ownership on the properties has been restored by the Court, they were immediately transferred to companies and individuals close to Tiholov and Tsonev.

Precisely architect Kalin Tiholov is the author of the controversial plan of Tsarevo, prepared during the term in office of Petko Arnaudov, in which the entire coast of Natural Park Strandza – from Tsarevo to Varvara, and large areas south of Ahtopol are slated for construction. The Master Plan allows the “cementing” of a total of 40% of the Park. The plan also includes a golf course, which will automatically destroy all biological diversity due to the chemical treatment of the meadows. Because of this plan, the European Commission launched an infringement procedure against Bulgaria, but Lapchev is still protecting it and is blocking the changes that would make it compatible with Natura 2000 and the plan for the management of Park Strandza.

The Mayor’s actions are also causing damages to the municipal budget as investors in “Coral” have paid for the illegal permits 1.5 million levs. This emerged from documents published by the Association “Let’s Preserve Coral.”

Bulgarian Politician and Economist Vladimir Karolev Was Also Preparing to Build on “Coral”

The focus of environmentalists to date was on the project of the Spanish company “Iberdrola Inmobiliaria” which planned to build a huge complex for 3,000 people. In May 2010, the Director of Communications and Marketing of “Iberdrola Inmobiliaria”, Jose Luis Gonzalez Sequera said the project “Coral Beach Elite” was one of the most important for his company and the latter will continue to carry out the plan agreed with local authorities. So far, 44 million euro has been invested in the project, of which 40 million euro for the purchase of the land, while the rest was for sewage and building permits.

The resolution of the prosecution, however, shows that there are seven other permits that have been issued to “Prime Property BG” ADTSIS and “Coral Residence”. They are for another project, which is adjacent to that of Iberdrola, but it also doesn’t meet the current parameters of the Territorial Development Act (TDA).

An investigation of journalists from Bivol in 2010 showed a detailed scheme for the acquisition of land for these projects, bought on the cheap from the Tsarevo municipality against promises of investments that never materialized.

The main protagonists in this deal are the Members of the Board of Burgas’ sugar factory “Pobeda” (Victory) – current Burgas Mayor Dimitar Nikolov, Simeon Simeonov and businessman Sava Choroleev who are partners through other companies of the company “Vitatur”. The Board of Directors of “Pobeda” also included Vladimir Karolev (until 2009). He also controls “Prime Property” ADTSIS through “Balkan Advisory Company”.

The waterfront land of 130 decares was bought by “Vitatur” in 2002 for 7 US dollars per square meter. The Mayor of Tsarevo Petko Arnaudov conveniently failed to enter into the contracts termination clauses in case investment plans are not met. “Vitatur” did not fulfill any of the promises, reshaped the land plots and resold them to companies related to the same owners.

Moreover, according to testimony of the Chair of the Municipal Council, negotiations for the deal took place in the office of Dimitar Nikolov in the “Pobeda” factory, and the deal was also political – against its inking, Nikolov promised the support of his right-wing party Union of Democratic Forces (UDF) for the reelection of the “red” Mayor Arnaudov.


The big profit from municipal land came a few years later, in 2005-2007, when the Spanish company “Iberdrola Inmobiliaria” shelled 40 million euro for 94 decares (about 400 euro per square meter). “Prime Property BG”, managed by Karolev, also acquired a portion of the municipal land, but now at market price – 25 decares at 175 euro per square meter, purchased by “Nevada Tours”, “Camon Tours”, “SVS”, “Ponce Holding” and “Holiday On”, all connected with Choroleev and “Pobeda”.


Once the managed by Karolev company invested “profitably” the shareholders’ money in lands owned by his colleagues in “Pobeda”, “Prime” expanded their gains with other land plots in the vicinity and announced that it would build the “Coral Residence” village. The building permits, which are now in the crosshairs of the prosecution, date from 2009


Проектът “Корал Резидънс”

Karolev, also known as the agent of the former Communist State Security (DS) with the codename “Kamen”, responded publicly to the publication about “Coral” by denying conflict of interest and threatened to sue the journalists who published data on the participation of both sides in the deal with the lands. In 2010, Sava Choroleev managed to remove Karolev from “Prime Property BG” and formally, he has no connection with the company currently. Until today, however, Karolev is one of the most vocal critics of the decision of the Ministry of Regional Development to block construction on “Coral” over the illegal permits.


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