Illegal hotels owned by UK citizens have been in business in Veliko Turnovo for more than two years.

Some of the hotels are in nearby villages, where many UK citizens have bought properties. Most of the illegal hotels are functioning as guest houses and hostels. From the outside, one cannot say that these buildings are in the tourism business and operating illegally. The bad looking facades and the absence of big and shiny advertising signs hide the real purpose of their activity. Only very small signs show that one can spend a night or two in these houses. The reason is simple. The owners of such buildings do not actually need to advertise for potential customers off the street, simply because they do not rely on them. The clients of such guest houses or hostelS are foreigners who make reservations in advance and have everything arranged for them. All of these hotel facilities are advertised on the internet.

In reality, out of the 10 guest houses and hostels in question, three do not have the permits for such tourism activity, Desislava Zaevska, head of the municipal commercial department at Veliko Turnovo municipality, says.

However she could only talk about buildings which were known to the local authorities. Experts think that the number of the phantom hotels is double than that the municipality officially knows about. The problem is that it is very difficult to establish which houses are used as businesses because the owners say that they are just private homes where friends of the family like to come to stay.

Authorities suspect that these friends are paying their hosts for the stay.

According to the law, the operator of a guest house or a hostel should have a sign on the wall with all the information about the stars of the guest house. This sign is given by the municipality after the owner acquires all the required permits.

An example of the opposite case is an illegal hostel owned by a UK family near the Grand Hotel Veliko Turnovo. This hostel lacks such a sign. Instead there is only a sign saying "low cost hostel". A check in similar hostels across Veliko Turnovo showed that the conditions in the "low cost hostel" are actually very good, if not excellent. One can see that considerable amounts of money have been invested. Most of the rooms have toilets, air conditioning, internet access, free of charge libraries with English literature, dishwashers and washing machines. The number of beds in such hostels varies from 20 to 40.

Some of the UK people who live in Veliko Turnovo have turned old-style Bulgarian houses in the old town into tourism facilities. In some cases, 200-year-old houses have been professionally restored and offer interiors and atmosphere from the time of the Bulgarian uprising in the mid-19th century.

Double wooden beds, spacious rooms, wide terraces with great views of the old town, combined with modern kitchen appliances and communication technology are offered without permits. Hristo Nedyalkov, who owns a hotel in the old town, says that a Scot has been in business for more than a year without any permit. The Scot not only pays no taxes for his income as an hotel owner, but has no permission to do business at all, Nedyalkov alleges. In a year, the Scottish investor has accumulated a considerable amount of money without paying any taxes, Nedyalkov notes.

Unfortunately it is very difficult for us to fight against such illegal activity, Zaevska says. We have to turn to neighbours for information or the internet and to ask the police for co-operation to find the owners.