The end of the GORUBSO-Madan saga may be in sight. The insolvent coalmine complex in southern Bulgaria has been a problem for state officials of two governments in the last two years.

Bankruptcy proceedings for GORUBSO-Madan that were demanded by the State Receivables Agency will begin in Smolyan district court on September 19. Ivan Nanev, a member of GORUBSO's board of directors, announced this on Sunday.

According to Rhodopi Investment, the owners of GORUBSO-Madan, the dismissal of company management and appointment of trustees, as well as the court's decision to open insolvency procedures was against the law. The owners want to see justified and lawful decisions.

On Friday, the Smolyan District Court opened bankruptcy procedures for GORUBSO-Madan and the company is now run by a trustee, Economy Minister Nikolai Vassilev announced. A 20-member working group that was appointed to reach a solution for the crisis took the insolvency decision unanimously. The working group, which included officials from the ministries of economy, finance, interior and justice, the Privatization Agency and State Receivables Agency, and the Miners' Chamber, had two days of meetings.

The decision has the support of the coalition partner of the ruling National Movement Simeon II (NMSII), and the Movement for Rights and Freedoms (MRF). Local MRF leaders have started talks with protesting GORUBSO workers and the hunger strike was called off on Saturday. The Madan workers have been protesting for weeks over unpaid wages from the time before GORUBSO-Madan was privatized in 1999.

Vassilev believes that winding up the company is the only way to save it, considering the huge losses it has built up as a result of poor management. The losses amounted to over four million leva last year.

After the sale of GORBSO, the new owners started to sell off its assets. According to figures cited by Vassilev, at the end of 1999 the company's own capital stood at 1.927 million leva, with its assets well exceeding its liabilities. By the end of 2000, GORBSO's capital stood at minus five million leva and now is probably about minus seven million leva, but nobody knows the exact figure.

The vice-president of the Podkrepa trade union, Dimitar Manolov, agreed that bankruptcy was the only way out for the company. The other influential trade union, CITUB, took a more guarded stand. Its deputy leader, Plamen Dimitrov, said that the matter of who owes the unpaid wages to the workers - the new owners or the government - should be clarified. Over 1,000 employees still working for GORUBSO get their wages regularly - an average of 300 leva per month, together with social and health insurance contributions, said Dimitrov. Vassilev claimed that the government owes nothing to the company because in every privatization deal, the new owner takes responsibility for all assets and liabilities. The present owners of GORUBSO-Madan acquired the company for 150,000 leva and promised to honour all its debts including the workers' wages.

Vassilev said that over the last two years the government has subsidized GORUBSO twice with a total of 742,000 leva.