(BRUSSELS) - The European Commission proposed on Tuesday to lift EU restrictions on Bulgarian airlines, on the eve of a report due to condemn corruption and mismanagement of European funds in the country.

Bulgaria joined the European Union in January 2007 but is subject to air traffic restrictions because of safety and staff problems with its Civil Aviation Authority (CAA).

The commission said it had sent EU member states "a proposal to lift the safeguard clauses imposed on Bulgaria in the area of aviation" to be considered at a meeting of justice ministers on July 25.

"Subject to the council's observations, the commission would expect to be in a position to take a formal decision in early September to lift the clause," it said in a statement

The move comes as the commission prepares to publish a scathing report attacking Bulgaria's handling of EU funds and rampant corruption in its administrative and judiciary systems, according to a draft seen by AFP.

EU member states currently do not automatically recognise Bulgarian air safety and maintenance certificates and its carriers do not have full access to all European routes.

The civil aviation authority has grounded some 160 outdated Russian-built planes and helicopters in a drive to boost safety.

In June 2007, it deprived four cargo carriers of air certificates and banned another from flying to the EU to prevent other Bulgarian airlines being placed on a European safety watchlist.

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