EPPO Probes Bulgarian Rail Deals

The first problem in Bulgaria's railway row is not, at least on the public record, a proven fraud. It is more prosaic and, in its own way, more revealing: a state rail infrastructure company appears to have signed contracts it had no secured money to pay for.

Georgi Peev, Bulgaria's transport minister, says the European Public Prosecutor's Office, the EU body that investigates crimes involving European funds, is examining 17 railway contracts signed between 2019 and 2021. According to Peev, Bulgaria's national railway infrastructure company, NKZHI, took on roughly €765 million in rail obligations without confirmed financing (24 Chasa, Boulevard Bulgaria).

That distinction matters. A state company signing contracts it cannot fund is already a serious governance failure. Whether EU money was lost, misused or placed at risk is the criminal question now sitting with prosecutors.

EPPO has not confirmed the investigation itself (Fakti). For now, the claim rests on Peev's public statements and Bulgarian press reports. But the minister did not speak vaguely. He gave the number of contracts and said his department would cooperate fully with prosecutors. The tone is familiar enough in European politics: a new administration laying out what it says it found in the cupboards left by the last one.

If breaches are confirmed, Bulgaria could face repayments or funding cuts of more than €400 million in connected EU money (BNR News, Fakti). The exposed EU programme has not yet been identified. OLAF, the EU's administrative anti-fraud office, is separately checking two rolling-stock delivery contracts.

An EU Prosecutor Working Through National Courts

EPPO is not an EU police force landing in a member state from outside. Its centre is in Luxembourg, but its cases are run inside national systems by European Delegated Prosecutors, using national police, national courts and national rules of evidence (EPPO, Regulation 2017/1939). In Bulgaria, that means an EU prosecutorial chain can take charge where European money is involved, while Bulgarian investigators and judges still do much of the practical work.

That hybrid model is the point of the institution, and also its limit. EPPO can stop a politically awkward file being quietly buried at home. It cannot conjure clean procurement files or missing documents after the fact. In 2024, the office processed 6,547 crime reports and identified estimated damage of more than €24.8 billion, according to its annual report. Those are suspected amounts, not proven losses. The hard part is turning suspicion into evidence that survives in court.

For Irish readers, the design is not entirely abstract. Ireland knows from the bailout years what it means when European oversight moves from background architecture to daily political reality. EPPO is a different instrument, narrower and criminal rather than fiscal, but it rests on the same uncomfortable bargain: EU systems can protect public money only if national systems are willing, or forced, to let them work.

The contrast with countries outside EPPO shows why membership matters. Participating states expose themselves to investigations that can be politically awkward. In return, they get a prosecutorial route that sits partly beyond domestic control. States that stay out, such as Hungary, leave suspected EU-funds fraud with national prosecutors alone (EPPO participating states).

Where Execution Breaks Down

The Bulgarian rail file points to a weakness that runs well beyond Bulgaria: what happens after European money has been promised and political approval has been granted. The vulnerable points are rarely glamorous. Procurement, permits, proof of financing, delivery schedules, audit trails. That is where a project either becomes a railway, a road or a hospital, or becomes a file that auditors and prosecutors spend years trying to reconstruct.

The European Court of Auditors has repeatedly warned about weaknesses in the systems designed to detect and punish fraud against EU money (ECA). EPPO has also carried out coordinated raids across several member states in funding investigations (Euronews). Romania is facing its own warnings about losing billions in recovery funding if projects miss EU payment deadlines (Libertatea).

The lesson is a simple one, though governments often prefer more complex explanations. A project can pass formal national approval while the question that decides whether money is being protected remains unanswered. In Bulgaria's case, that question was basic: was the financing secured before the contracts were signed? Peev says it was not.

The 17 contracts, the contractors, the funding programmes and the suspected offences have not been disclosed. Until EPPO or a court confirms the scope of the case, the firmest conclusion is the one Peev himself has put on the record: Bulgaria's railway system took on hundreds of millions in commitments it could not back. The investigation will decide whether EU funds were pulled into that failure, and whether anyone is held responsible for it.