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Articles contributed by Penkov, Markov & Partners
On 14 June 2012, the Ministry of Economy, Energy and Tourism published on its Internet site draft amendments to the Protection of Competition Act and respective reasons.
One natural consequence of the economic crisis is the steadily growing number of bankruptcy proceedings. An effective means of protecting the interests of creditors in such proceedings is the introduction of the principle of nullity of transactions concluded during the so-called ‘suspicious period', directly following the initial date of insolvency (or, respectively, over-indebtedness).
In a previous article, I asked the question of whether the State is “for” or “against” green energy. The latest amendments to the law of April 10, 2012, as well as subsequent decisions by the State Energy and Water Regulatory Commission (SEWCR) confirmed that the State takes a stand against wind and photovoltaic power generation.
Finally, after two years of active involvement of Penkov, Markov & Partners - Attorneys at Law, as assigned by the American Chamber of Commerce in Bulgaria and with the participation of the Bulgarian Chamber of Commerce and Industry, the Bulgarian Industrial Association and the Confederation of Employers and Industrialists in Bulgaria, in drafting and development of proposals for amendments to the regime of commercial registration, directed at overcoming the omissions and inconsistencies in the current legislation, our efforts were crowned with success, as with the newest legislative amendments most of the NGOs suggestions were adopted.
For many years, for known and unknown reasons, and in gross inconsistency with EU requirements, the state has (not) been dealing with the betterment of the investment climate and in particular, with the development of this sector. Its actions have been rather shy and non-transparent for citizens and the relevant branch organizations and other non-governmental organizations showing interest in the issue alike.
Development of market relations and diversification of involvement in economic life have increasingly raised questions about different aspects of the participation of non-profit organizations, such as associations, foundations, etc. in economic activities.
The economic crisis has brought about an avalanche of bankruptcies of an ever increasing number of small, medium and large commercial entities in all economic sectors. Insolvency, for its part, has evolved and turned from an almost extraordinary ground for suspension of economic activities into a phenomenon competing with the voluntary liquidation of companies.
Largely as a manifestation of the freedom of movement of capital across the EU, but also as an effect of globalization and the operation of trans-national companies in need of flexible financing, such financing is relatively frequently obtained centrally by the relevant company. At the same time, its subsidiaries in individual countries also get some access to the financing thus obtained, with their local assets serving as a security or collateral.
Necessary amendments in the Commercial Register legislation in line with the best European practices
Before the new Commercial Register with the Registry Agency was established, entrepreneurs, the ones who generate the real income for the budget, used to complain that the procedures were sluggish, that criteria were not equal for everybody, that predictability, accountability and analyses were lacking, that there was no uniform information system and that the registration procedures of the courts were non-transparent.
The bill to amend and supplement the Film Industry Act (“the Act”), proposed late last year by Bulgarian filmmakers, has stirred up a discussion on whether the introduction of tax credit in this field is the long-sought panacea to revive Bulgarian cinema or just another imprudent move aimed at using the otherwise positive experience of others in this area, among those engaged in filmmaking in Bulgaria.
After the latest changes in the Bulgarian financial legislation and, in particular, the Credit Institutions Act, and the issuing by the BNB of Ordinance No. 26 of 23 April 2009 on Financial Institutions (the Ordinance), the providers of financial services passed into a more complicated registration regime.
The process of restitution, although its functions gradually die away, still creates a certain insecurity regarding in the right of ownership of real estate, resulting from the possible collision between ownership rights stemming from restitution laws and ownership rights acquired as a result of a legal transaction or by prescription.
During recent years the question of the admissibility of temporary agency work contracts between two legal persons has been raised ever more frequently.
This article focuses only on cases of commercial transactions for transfer of registered shares and the right to acquire them, respectively. Cases of transferring bearer shares, as well as dematerialised shares, will not be a matter of review in this article. Irrefutably, the transfer of shares is a commercial transaction as defined by the Commerce Act. However, in order for the title over the registered materialised share to be validly transferred to the new transferee, a unilateral statement of will should be made by the transferor by way of an endorsement. The endorsement, itself, is not a component of the factual elements contained in the contract for purchase and sale of a given registered share but constitutes a separate formal abstract transaction.
A Perilous Undertaking: Competition on Equal Footing with Prohibited Agreements and Abuse of Dominan
The new Competition Protection Act was enforced on 1 December 2008, more than one year after the public announcement of the draft act and its introduction by the Commission for Protection of Competition (CPC; the Commission) to the Council of Ministers. It was surprising that the chapter which regulates the different events of unfair competition was reinstated in the final text, tabled by the Council of Ministers and adopted by the National Assembly.
In commercial turnover, especially in cases of senior management staff, remuneration is often paid not only in cash but also in the form of other fringe benefits, which also have certain value.
In relation to such added value to the remuneration, tax legislation arranges income of natural persons as ‘cash’ and ‘non-cash’, both subject to taxation.
Bulgaria has made a priority for itself the building of an information society as a basis for a modern and efficient economy of knowledge that encourages innovation and competitiveness. Building an information society is among the main targets of the Lisbon Strategy of 2000 where it is seen as a tool for creating more jobs and improving the social standing of citizens. Providing such services is considered a national and a European priority with a significant social charge.
A specificity in Bulgarian legislation is the existence of a trade representation office outside scope of the Commerce Act, and namely representation as set out in the Investment Promotion Act. This often leads to conflicting interpretations and lack of understanding with regard to the representation office’s exact status.
The registration of .bg domains is regulated by the General Terms and Conditions for Registration and Maintenance of .bg and subordinated Domains, as amended and supplemented in order to reflect the development of the relations connected with the provision of domains, as well as any disputes that may arise. The latest amendments of these Terms and Conditions (18.09.2008) rendered the greatest change in the registration regime made so far, with some new mechanisms of domain protection established.
A practical insight to cross-border Cartels & Leniency
A common issue which underlies a great portion of employment related litigations in courts is connected with determining the compensation amount payable by the employer when terminating employment relations.
High growth rates and the development of Bulgarian market stimulate the progressively increasing number of mergers and acquisitions. Bulgaria's accession to the European Union is an additional stimulus spurring M&A dealings, regardless of the developments on global financial markets.
In the autumn of 2007, the Commission for Protection of Competition (CPC) publicly announced a bill for an entirely new Competition Protection Act, prepared in cooperation with the Italian Competition Authority. Along with the many amendments, the proposed bill excluded of its scope the regulation of the unfair competition with the motive that the unfair competition matter is governed by the Consumer Protection Act and that the protection against unfair competition is not a typical aspect handled by the competition authorities of the EU Member States.
The year 2007 was fundamental to the development of the energy sector in Bulgaria. In compliance with Bulgaria’s responsibilities as an EU member, requirements for complete liberalisation of energy markets have been met by the amendments made in the statutory framework. Naturally, the new legal provisions are only a prerequisite for the factual liberalisation and realisation of the market mechanisms. Some consumers have become very familiar with the ins and outs of the liberalised market, particularly in the field of electroenergetics, where the industry structure presupposes development of market relations.
There have been wide public discussions about the major problems, which were faced by the trading entities in the process of the re-registration of already existing merchants and registration of a new company or a branch.
The amendments to the Ordinance on the Terms and Procedure for Registration of the Price of Locally Produced and Imported Tobacco Products, Trade in Tobacco Products and Control on Trade (the Ordinance) effective from late 2005 and early 2006 introduced some radical changes in the rules and procedure for registration of tobacco products available on the Bulgarian market
Regarding the part of the Act, which harmonizes the legal framework in view of Bulgaria’s accession to the EU, we can clearly give a positive answer.
The constitutional changes of 2005 enacted pursuant to the requirements of the Treaty of Accession and the Protocol concerning Bulgaria’s EU accession are already in force. According to the previous legal requirements, foreign citizens were able to freely acquire the right of ownership over buildings and parts of buildings, but had no right to acquire ownership of land and had only limited in rem rights (right of use, right to construct a building). The new amendment of Article 22 of the Bulgarian Constitution, allows foreign citizens and foreign legal persons to acquire right of ownership of Bulgarian land according to the Treaty of Accession, on the basis of international agreements and treaties, which were duly ratified, publicly released and have entered into force, or in case of inheritance under the law.