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Varadinov & Co.
Legal Bulletin

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State Gazette, issue 90 /November 10th, 2017
Changes in the rules on secondment, temporary suspension and the fixing of additional remuneration for magistrates foresee the latest changes in the Judicial System Act. The possibilities for posting, albeit exceptionally, on an unoccupied post, subject to the conditions of Art. 227, para. 2 - 9 of the JSA. Where a judge of the specialized criminal court is prevented from performing his duties and can not be replaced by another judge of the same court, the chair of the specialized criminal court of appeal may post in his place a judge from a specialized criminal court of appeal, a judge from another district or district a court with the rank of a judge in an appellate court with the agreement of the chair of the relevant district or regional court. Similar possibilities are envisaged for the posting of prosecutors in various state accusations structures aside from the Chief Prosecutor.
In the cases under Art. 132 of the Constitution of the Republic of Bulgaria, where a judge, prosecutor or investigator is charged as an accused for an intentional crime of a general nature in the exercise of his official powers, the relevant college of the Supreme Judicial Council temporarily removes him from office until the end of the criminal proceedings. In the case of a magistrate accused of having committed a crime of a general nature beyond his official capacity, the relevant colleague of the Supreme Judicial Council may remove him from office until the end of the criminal proceedings. The College may hear the judge, prosecutor or investigator before taking a decision. The term of temporary removal from office in pre-trial proceedings may not exceed the term under Art. 234, para. 8 of the Criminal Procedure Code.
For the period of temporary dismissal of the judge, prosecutor and investigator, remuneration is paid at the amount of the minimum salary. Upon expiration of the term under Art. 234, para. 8 of the Code of Criminal Procedure and upon suspension of the criminal proceedings, the suspended magistrate may request from the respective college of the Supreme Judicial Council by decision to restore it to the position held. The refusal is subject to appeal before the Supreme Administrative Court under the Administrative Procedure Code. The request for temporary removal from office is made by the Chief Prosecutor at the proposal of the monitoring prosecutor and motivated. Where a detention on remand has been taken, the magistrate is deemed to have been temporarily removed from office as from the date of entry into force of the judicial decision determining the measure.
The judges in the specialized criminal court and the prosecutor’s office and the investigators in the investigative department of the specialized prosecutor’s office will receive an additional remuneration of up to 6 basic monthly salaries per year according to the rules for individual evaluation of the results of the activity approved by the respective college of the Supreme Judicial Council. An analogous rule is also introduced with regard to court clerks in the specialized criminal court and the prosecutor’s office.

State Gazette, issue 92 /November 17th, 2017
Increasing the guarantees for the collection of public receivables are aimed at changes in the Tax and Insurance Procedure Code. In the circle of third parties who are responsible for outstanding obligations as a result of concealing facts and circumstances that were legally required to declare, procurators are also included. Analogous extension of the circle of responsible entities was also introduced for the performance of acts of bad faith, resulting in the assets of the liable person being reduced and therefore no tax and / or compulsory insurance contributions have been extinguished. The hypotheses in this case are two - making payments in kind or in cash from the assets of the liable person representing a hidden distribution of profits or dividends or alienating property, including the enterprise, to the obligated person free of charge or at prices significantly lower than the market ; carrying out actions related to burdening the assets of the obligated legal person for securing a foreign debt and being redeemed in favor of the third party.

The majority shareholders of the capital, including majority shareholders or shareholders of that capacity, are accountable to the shareholders on the day of incurring the liabilities, which in bad faith transfer their holdings or shares so as to cease to be majority shareholders or shareholders. They are liable for outstanding tax and statutory contributions in proportion to their participation in the expropriated portion of the capital with the following definition of bad faith: when the venturer or shareholder knew that the company was over-indebted or insolvent and the order was made before the earlier of the two dates: 1. announcement of the debtor’s application for insolvency proceedings in the commercial register; 2. registration of a decision of the insolvency court for initiation of insolvency proceedings of the debtor. Liability ceases when the insolvency court terminates insolvency proceedings due to the approval of a rescue plan or on the basis of a contract for settlement of the payment of the monetary obligations under Art. 740 of the Commerce Act.
In the case of a request for exchange of information under para. 1 and under conditions of reciprocity, the Minister of Finance or a person authorized by him / her may request the insurer to disclose an insurance secret within the meaning of Art. 149, para. 1 of the Insurance Code and the court to disclose a bank secret in the meaning of Art. 62 of the Credit Institutions Act, a secret within the meaning of Art. 35, para. 2 of the Markets in Financial Instruments Act and Art. 133 of the Law on the Public Offering of Securities or within the meaning of another provision of the Bulgarian legislation on the confidentiality of monetary funds, financial assets and other property where from the facts set out in the request for exchange of information it is clear that it was made in compliance with the information exchange requirements in the relevant international treaty.

State Gazette, issue 95 /November 28th, 2017
Expanding the scope of supervision, transparency in the selection of staff and higher remunerations provide for changes in the Law Financial Supervision Commission. The circle of supervised entities has been extended to private and public entities and institutions, as well as European regulations and directives. The requirements for the members of the Financial Supervision Commission have been increased. They may be only Bulgarian citizens with higher education with a master’s degree in economics, finance, law, mathematics, informatics and other relevant ones with a view to supervising and regulating non-banking financial sector specialties that have a good reputation, knowledge, skills and professional experience and have at least 5 years of work experience in the field of the last 10 years. For the members of the Commission, the professional experience in the specialty should be acquired: 1. in state institutions or other bodies governed by public law; 2. in a regulatory body of the banking and / or non-banking financial sector; 3. in a bank and / or in an enterprise of the non-banking financial sector; 4. to a position with managerial functions in financial management and / or control in enterprises in the non-financial sector. The circumstances, which are to be declared by the members of the Committee, regarding their compatibility, shall be declared to the Chairman of the National Assembly upon taking office.
The remuneration of the Chairman and other members of the Commission shall be determined in accordance with internal salary rules adopted by the Commission and the remuneration may not be lower than the average remuneration of the members of the management bodies of the investment firms, , reinsurers and pension insurance companies determined on the basis of the last accounting year and does not exceed the level of the remuneration of the manager and the sub-governors of the Bulgarian National Bank. The chairman and other members of the Commission shall have all rights in an employment relationship other than those which are incompatible with or contradict their legal position. The Chairman and the other members of the Commission shall receive additional remuneration for the results achieved, determined in the manner and in the manner set out in the internal wage rules.
The activity of the administration is carried out by persons working under an employment relationship. The employment relationships of the Commission’s employees are governed by the provisions of the Labor Code. An employee of the Commission may not be a person who has been convicted of an intentional crime of a general nature; would be in a hierarchical relationship of leadership and control with a spouse, a person with whom he/she is in fact a cohabitation, with a relative in a straight line without restrictions, a collateral line up to the fourth degree inclusive, or by affinity to a fourth degree inclusive; is a sole trader, an unlimited liability partner in a commercial company, a manager, a commercial agent, a commercial agent, a procurator, a commercial agent, a liquidator or a trustee, a member of a management or control body of a commercial company or cooperative; is a Member of Parliament; 5. occupy a leading or control post at national level in a political party; exercises control over the supervised person or holds directly or through related parties more than 5 percent of the voting rights in the general meeting or the capital of the supervised person; is a member of the supervisory or supervisory bodies of the supervised person or is entitled to manage or represent the supervised person without being a member of its management or supervisory bodies; works under a labor or civil law relationship for the supervised person. At the conclusion of the employment contract, the employees of the commission are obliged to declare their property status to the chairman of the commission. Every year until 30 April, the employees of the commission are obliged to declare to the chairman of the commission their property status as well as the income received from the previous calendar year from contracts for additional labor under Art. 111 of the Labor Code, incomes from remuneration for non-labor relations, as well as the employer / contracting authority, who paid them, and the reasons for their receipt.