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Varadinov & Co.
Legal Bulletin

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State Gazette, issue 79 /September 8th, 2020
Increased control over the extraction of natural resources is aimed at amendments in the Mineral Resources Act. The public should be notified of any additional information related to the permits for mining waste management, and the information shall be disclosed on the website of the Ministry of Energy within 10 days of learning. Applicant for a permit for prospecting and exploration or for exploration or extraction concession can be any natural or legal person or their associations. The applicant shall not be admitted to authorization proceedings where any of the following grounds for exclusion exist: an effective judgment by which the applicant or a member of its management or supervisory body, or a person authorized to represent, takes decisions or to exercise control over those authorities, has been convicted of certain offenses, or has entered into force a conviction or other judicial act for a similar offense in another Member State of the European Union or a third country; there is a court or administrative act that has entered into force, by which it has been established that the candidate has not fulfilled obligations within the meaning of Art. 162, para. 2 of the Tax-Insurance Procedure Code and the interests under them in the Republic of Bulgaria, or similar obligations according to the legislation of the state in which the applicant is established; there is an entered into force act imposing an administrative penalty under this law for the last one year before the submission of the application for granting a permit for prospecting and exploration or for exploration or for a concession for extraction; admitted by the applicant non-fulfillment of an obligation under a contract for granting a concession for extraction of mineral resources, which has led to termination of the respective contract; 5. registration of the applicant or of persons related to him in a jurisdiction with preferential tax regime within the meaning of § 1, item 64 of the additional provisions of the Corporate Income Tax Act; 6. declared insolvency or liquidation, or open insolvency proceedings of the applicant, or the existence of a similar procedure according to the legislation of the state in which he is established. The above circumstances are certified by a declaration and an official inspection.
The applicant for a prospecting or exploration permit or for an exploration or extraction concession must meet the minimum requirements for financial, technical and professional capacity necessary to carry out the activities provided for in the work program or in the development plan of the deposit - in case of granting by right a permit for prospecting and exploration or for exploration, or a concession for extraction, or specified in the tender or tender documents - in other cases. To prove financial, technical and professional capacity, the applicant may use the resources of a third party when he proves that there is no ground for exclusion for the third party, including that in the performance of the prospecting or exploration contract or the concession contract third party resources will be available for extraction. The financial capabilities of the applicant must provide the financial resources necessary for the performance of the permitting activities or the performance of the concession activities for at least 5 years from the entry into force of the concession contract, including payment of the concession payment. The technical capabilities of the applicant must provide assets necessary for the implementation of the activities under the permit or concession.
An area may be granted more than one exploration or exploration permit, or more than one extraction concession, provided that they are granted for different groups of mineral resources, the activities under one permit or concession shall not impede the implementation of activities under another permit or concession and consent has been obtained from any acting holder or concessionaire. In order to limit the load on the territory of the country with mining activity, the Council of Ministers, upon a motivated proposal of the Minister of Energy, may adopt a decision to limit the issuance of permits for prospecting and exploration or exploration of common mineral resources for a certain period. The procedures for granting exploration and prospecting permits and exploration concessions shall be conducted in accordance with the principles of transparency, publicity and competition.
No proceedings shall be instituted for granting a permit for prospecting and exploration, when: there is a danger for the national security or the defense of the country or the environment, or the waters, or the cultural values, or for destruction or damage of roads from the national road network; an application has been submitted for an area that covers in whole or in part parts of the area within which a mineral resource deposit has been registered or a commercial discovery has been established and an application for its registration has been submitted. The overall control over the implementation of the contracts for prospecting and exploration or for exploration or for concession for extraction shall be carried out by the Minister of Energy. The control over the performance of the contracts includes periodic control over the fulfillment of the conditions of the permit or the concession and of the obligations of the holder or the concessionaire in accordance with the provisions of the contracts.

State Gazette, issue 81 /September 15th, 2020
The Financial Supervision Commission issued Ordinance № 8 / 3.09.2020 on the requirements for the activity of the central securities depositories, the central securities register and other persons performing activities related to the settlement of securities. The ordinance regulates: additional requirements for central securities depositories licensed by the Financial Supervision Commission to provide services in accordance with the Annex to Regulation (EU) № 909/2014 of the European Parliament and of the Council of 23 July 2014 on improving the settlement of securities in the European Union and for central securities depositories; the cases in which exceptions from the rule under Art. 227b, para. 2, sentence one of the Markets in Financial Instruments Act and of the rule under Art. 138, para. 2, sentence one of the Public Offering of Securities Act; the requirements to the rules and procedures of the central securities depositories for each system for settlement of securities managed by them in case of non-compliance by one or more participants in them; the procedure for calculating the indicators for determining the currencies in which settlement is most often made; the risks that are reported in accordance with Art. 53 (3) of Regulation (EU) № 909/2014, when performing a comprehensive risk assessment at the request of a central securities depository for access to a central counterparty or a trading venue, respectively when considering complaints in case of denied such access; the procedure for calculating the indicators for determining the materiality of central securities depositories when the Republic of Bulgaria is a host Member State; additional requirements in connection with the reporting of the internalized settlement under Art. 227, para. 1 of the Public Offering of Securities Act; 8. the procedure for payment of dividends, interest, principal and other payments by public companies and issuers, as well as the persons through whom dividend payments may be made; additional requirements to Central Depository AD and the central register of securities kept by it; requirements in connection with the application of Art. 6, paragraph 2, para. 2 of Regulation (EU) № 909/2014.
The Financial Supervision Commission shall maintain and, if necessary, update the list of central securities depositories for which it is the competent authority. The Central Securities Depository maintains an electronic database and maintains: accounts of issuers and holders of financial instruments; of financial instruments; to the participants in the securities settlement system managed by it; the rights to subscribed shares; registers of transfers and transactions in financial instruments. The Central Securities Depository shall develop and adopt rules and procedures for each securities settlement system managed by it for necessary actions in initiating insolvency proceedings against participants in the securities settlement system, against another central securities depository, with which has an established relationship against entities performing settlement of the monetary arm from transactions with financial instruments through the Central Securities Depository, against trading venues and other relevant stakeholders depending on the relations established by the Central Securities Depository. The rules and procedures may also include the settlement of other events and circumstances, other than the opening of insolvency proceedings, which affect participants in the settlement systems managed by the Central Securities Depository. The rules and procedures shall be adopted by the governing body of the Central Securities Depository and shall form part of the depositary’s rules.

State Gazette, issue 82 /September 18th, 2020
The requirements of Regulation (EU) 2019/125 of the European Parliament and of the Council of 16 January 2019 are introduced in a new law on trade in certain goods that could be used to carry out the death penalty, torture or other cruel, inhuman or degrading treatment or punishment. The law regulates trade with third countries in such goods as related to the provision of brokerage services, technical assistance, training and advertising. Authorizations for the export, import, transit and services of the goods referred to in the Annexes to the Regulation shall be issued by the Minister of Economy or by officials authorized by him. The export permit may be individual, general or general. Persons applying for an individual or general export permit shall submit to the Minister of Economy the relevant documents, including those certifying that for the previous year the applicant has performed and / or will perform in the following year on the basis of contractual relations not more less than 10 exports of the goods described in the application to each of the recipients indicated therein. The issued permit is valid for up to two years, which can be extended once for up to one year.
Persons applying for an import permit shall submit the following documents to the Minister of Economy and pay a state fee. The documents in a foreign language shall be submitted accompanied by a certified translation into Bulgarian, which shall contain the three names of the person who performed the translation, position and place of work, and the foreign language from which the translation was performed. The permits are issued within 15 days of receiving the documents from the Ministry of Economy. Within 5 days from the issuance of the permit the body shall notify the applicant in writing, and in case of finding irregularities in the submitted documents within 5 days from the date of receipt of the documents shall give instructions for its removal. Within 15 days from the date of receipt of the notification the applicant is obliged to eliminate the irregularity. The term shall cease to run from the date of sending the notification to the applicant and shall be resumed from the date of receipt of the documents by which the irregularity has been eliminated. The issued individual permits have a validity period of up to 6 months from their issuance, which can be extended once for a period of up to 6 months. If a permitted transaction is not executed within the term of the issued permit, not later than 15 days before the expiration of the term the applicant may request its continuation with a motivated application containing information about the unfulfilled part of the transaction and a declaration that no change has occurred. in which the permit has been issued. The permit shall be issued in triplicate. The first copy shall be provided to the applicant and the other two shall be kept at the Ministry of Economy. The permit may be used only by the person to whom it is issued, and may be required to provide additional information related to the transaction, as well as opinions from experts on issues for which specialized knowledge is required. Orders for refusal or suspension of a permit may be appealed under the Administrative Procedure Code. The control over the implementation of this law is carried out by the Minister of Economy and by the Director of the Customs Agency or by officials authorized by them.