Varna Integrated Urban Transport Project



Project number:


Business sector:

Municipal and environmental infrastructure

Notice type:


Environmental category:


Approval date:

26 Feb 2013



PSD disclosed:

12 Oct 2012

As permitted by paragraph 2.6 of Section III of the Access to Information Policy, disclosure of this PSD was deferred in accordance with paragraph 1.4.4 of the Directive on Access to Information.

Project Description

A loan of up to EUR 7.9 million to the City of Varna ("City" or "Varna") to finance, jointly with the European Union Structural and Investment Funds ("ESIF"), the following investments in Varna:

  1. Varna Integrated Urban Transport project, implemented under a grant agreement with EU Operational Programme Regional Development(2007-2013);
  2. A project for improving the quality of life in the City through acquisition of new trolleybuses for the public urban transport in Varna, implemented under a grant agreement with EU Operational Programme Environment (2007-2013);
  3. A project for rehabilitation of two flood control channels in Asparuhovo residential area, implemented under a grant agreement with the EU Solidarity Fund

The flood control channels rehabilitation component has been introduced after the tendering process for the first two investments was completed. At that stage, the City informed the Bank that it achieved savings and requested to reallocate a part of the loan proceeds to the flood control channel rehabilitation component. The flood control channels rehabilitation component will complement the objectives of the first two investments since it will protect essential road infrastructure used by public transport from the risk of floods and destruction, thus improving the urban mobility in the City.

Project Objectives

The Project involves implementation of a package of complementary investments, which focus on the development of a modern, sustainable and safe urban transport in the third largest city in Bulgaria. The main components of the Project include:

  • Introduction of a Bus Rapid Transit ("BRT") corridor to reduce travel times and increase public transport usage.
  • Introduction of a system for provision of public urban transport vehicles priority at intersections along BRT corridor.
  • Deployment of an electronic ticketing system on-board public transport vehicles and at bus stops.
  • Deployment of a real-time passenger information system at bus stops and on-board public transport vehicles.
  • Development of a public urban transport management center.
  • Acquisition of new rolling stock, including 50 diesel EURO 6 buses, 20 compressed natural gas buses and 30 trolleybuses.
  • Upgrade of three bus terminals and rehabilitation and modernization of a bus depot.
  • Development of new cycling facilities, including cycling paths, parking facilities, cycling campaign and a bike rental scheme.
  • Rehabilitation of flood control channels in Asparuhovo Residential Areas to protect its residents as well as essential road infrastructure from the negative impact of climate changes.

Transition Impact

Improved contractual framework for markets achieved through:

Public Service Contact (PSC): An EU-compliant PSC will be developed and introduced between the City and the incumbent municipally-owned public transport operator Gradski Transport EAD. The PSC constitutes a new multi-year contractual arrangement between the City and the public transport operator. It will establish a solid framework for service delivery, cost controls, compensation levels, and regulation of a key public service. This PSC should also be adopted for any private sector bus operations, such as the regional lines.

Revised Public Transport Scheme (PTS): Assistance to the City to revise its public transport scheme with the objective to eliminate doubling lines to the BRT, introduce feeder lines to the BTR and improve the overall efficiency of the routes.

Revised parking strategy with increased private sector participation: EBRD will assist the City in designing and launching a full on-street parking scheme to be implemented according to commercial principles for short-term visitors in downtown Varna. The private sector will also be involved contractually in running the back-office payment collection and distribution system as well as SMS-based payments with mobile phone providers.

Client Information


The City of Varna is the third largest municipality in Bulgaria, a major Black Sea port and a leading industrial and commercial center.

EBRD Finance Summary

EUR 6,167,565.50

A long-term loan of up to EUR 7.9 million to the City of Varna.

Total Project Cost

EUR 66,082,620.00

Total Project cost amounts to EUR 78.5 million including VAT.

Technical Cooperation and Grant Financing

The Bank will provide the following post-signing Technical Cooperation:

  • Assistance to the City to complete an EU-compliant PSC for Varna - EUR 100,000.
  • Assistance to the City to revise its Public transport scheme with the objective to eliminate doubling lines to the BRT, introduce feeder lines to the BTR and improve the overall efficiency of the routes i EUR 100,000.
  • Assistance to the City to prepare a parking strategy, introduce blue zone, and on-street parking fare collection system, and a tender documentation and support for the design, supply and maintenance of the system to the private sector EUR 150,000.

Company Contact Information

Peycho Peychev, Deputy Mayor
43, Osmi Primorski Polk Boulevard 9000 Varna, Bulgaria

Implementation summary

The Project involved implementation of a package of complementary investments, focusing on the development of a modern, sustainable and safe urban transport in the third largest city in Bulgaria. The operation supported the City's urban transport system reforms which aimed at providing high quality public transport services, including introduction of a Bus Rapid Transit system, replacement of obsolete and inefficient rolling stock with new, clean diesel and compressed natural gas buses and development of a cycling network and pedestrian facilities. Alongside these investments, the Project included integrated electronic ticketing and a real-time passenger information system. Initially, total project cost amounted to EUR 76 million with VAT, while after some savings achieved by the City, the amount of the project was reduced to EUR 66 million with VAT. Although the Bank's loan is fully disbursed and physical completion achieved, the project has not yet reached operational completion.

The project also ensured adherence to strict environmental, energy-efficiency and social standards. The Company has fully implemented the Environmental and Social Action Plan on time.

As a part of its transition impact, the Project contributed to improved contractual framework for markets achieved through: (i) enhanced PSC arrangements between the City and the municipally owned urban transport company; (ii) successful introduction of a Bus Rapid Transit (BRT) corridor demonstrating a new approach to the City's need for high capacity public transport solutions; and (iii) implementation of a revised parking strategy.

PSD last updated

04 Sep 2020

Understanding Transition

Further information regarding the EBRD’s approach to measuring transition impact is available here.

Business opportunities

For business opportunities or procurement, contact the client company.

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Tel: +44 20 7338 7168

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Specific enquiries can be made using the EBRD Enquiries form.

Environmental and Social Policy (ESP)

The ESP and the associated Performance Requirements (PRs) set out the ways in which the EBRD implements its commitment to promoting “environmentally sound and sustainable development”.  The ESP and the PRs include specific provisions for clients to comply with the applicable requirements of national laws on public information and consultation as well as to establish a grievance mechanism to receive and facilitate resolution of stakeholders’ concerns and grievances, in particular, about environmental and social performance of the client and the project. Proportionate to the nature and scale of a project’s environmental and social risks and impacts, the EBRD additionally requires its clients to disclose information, as appropriate, about the risks and impacts arising from projects or to undertake meaningful consultation with stakeholders and consider and respond to their feedback.

More information on the EBRD’s practices in this regard is set out in the ESP.

Integrity and Compliance

The EBRD's Office of the Chief Compliance Officer (OCCO) promotes good governance and ensures that the highest standards of integrity are applied to all activities of the Bank in accordance with international best practice. Integrity due diligence is conducted on all Bank clients to ensure that projects do not present unacceptable integrity or reputational risks to the Bank. The Bank believes that identifying and resolving issues at the project assessment approval stages is the most effective means of ensuring the integrity of Bank transactions. OCCO plays a key role in these protective efforts, and also helps to monitor integrity risks in projects post-investment.

OCCO is also responsible for investigating allegations of fraud, corruption and misconduct in EBRD-financed projects. Anyone, both within or outside the Bank, who suspects fraud or corruption should submit a written report to the Chief Compliance Officer by email to All matters reported will be handled by OCCO for follow-up. All reports, including anonymous ones, will be reviewed. Reports can be made in any language of the Bank or of the Bank's countries of operation. The information provided must be made in good faith.

Access to Information Policy (AIP)

The AIP sets out how the EBRD discloses information and consults with its stakeholders so as to promote better awareness and understanding of its strategies, policies and operations following its entry into force on 1 January 2020. Please visit the Access to Information Policy page to find out what information is available from the EBRD website.

Specific requests for information can be made using the EBRD Enquiries form.

Independent Project Accountability Mechanism (IPAM)

If efforts to address environmental, social or public disclosure concerns with the Client or the Bank are unsuccessful (e.g. through the Client’s Project-level grievance mechanism or through direct engagement with Bank management), individuals and organisations may seek to address their concerns through the EBRD’s Independent Project Accountability Mechanism (IPAM).

IPAM independently reviews Project issues that are believed to have caused (or to be likely to cause) harm. The purpose of the Mechanism is: to support dialogue between Project stakeholders to resolve environmental, social and public disclosure issues; to determine whether the Bank has complied with its Environmental and Social Policy or Project-specific provisions of its Access to Information Policy; and where applicable, to address any existing non-compliance with these policies, while preventing future non-compliance by the Bank.

Please visit the Independent Project Accountability Mechanism webpage to find out more about IPAM and its mandate; how to submit a Request for review; or contact IPAM  via email to get guidance and more information on IPAM and how to submit a request.


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