EU Suspends Bulgaria's Funding

The European Union has suspended almost ?500m (?400m) in aid to Bulgaria after the publishing of two damning reports into Sofia's failure to tackle corruption.

The European Commission says the funds will not be paid out because Bulgaria has made little progress in reforming its judiciary and tackling sleaze in the 18 months since it joined the union.

It says spending irregularities are so serious that the accreditation of two government agencies disbursing EU funds will be canceled.

The commission also said Bulgaria had failed to convict fraudsters ? one of the conditions on which it was admitted into the EU in 2007.

In a statement it said: "Reform of the judiciary and law enforcement structures is necessary and long overdue. The fight against high-level corruption and organized crime is not producing results."

The two reports, on the management of EU funds and judicial reform and corruption, were critical of Bulgaria but had been toned down from an earlier draft version leaked to the media.

The commission stopped short of delaying Bulgaria's entry to the single currency.

An EU chief spokesman, Johannes Laitenberger, said: "While there has been movement on a few cases [of corruption and organized crime], many alleged cases go unpunished."

The suspended funds concern a technical assistance program for countries joining the EU and a road-building scheme.