AmCham Bulgaria Presented Rule of Law Report Proposing Changes in Several Areas of Business-related Legislation

On 17 January 2024, AmCham Bulgaria presented a Report with proposals for improvements in some aspects of the rule of law and the business environment in Bulgaria.

The event was held at the National Press Club of the Bulgarian Telegraphic Agency, and this is yet another initiative in the last 10+ years by which the Chamber has initiated public and expert deliberations in this area, as well as proposed concrete solutions to some of the pressing issues for improving the business environment and investment climate in the country.

The press conference was attended by Ivan Mihaylov, CEO, AmCham Bulgaria; Adv. Omurtag Petkov, Chairman of the “Rule of Law and Legislative Reforms” Committee of the AmCham Bulgaria and partner at the law firm “Dzhingov, Guginsky, Kyuchukov and Velichkov”; Adv. Georgi Atanasov, partner at Dokovska, Atanasov & Partners law firm; Andrei Yankulov, Anti-Corruption Fund; Assoc. Prof. Dr. Hristo Hristev, Sofia University “St. Kliment Ohridski”; Asst. Dr. Anastas Punev, Sofia University “St. Kliment Ohridski”.

“With this project, the American Chamber of Commerce in Bulgaria has set itself several objectives. We find it important to continue the public discussion on important issues for business and society, which often have a legal dimension, attracting business supporters with whom our common proposals can be implemented.

It is a known fact that investors make an extremely accurate assessment of their presence or entry into a given market through the prism of a multitude of factors, including the rule of law and opportunities for business development unencumbered by unnecessary bureaucracy, lack of corruption, and arbitrariness, we focused on part of the problems of the Bulgarian legal system, which our members also directly or indirectly face.

Third, the administrative and legal burdens that every business incurs have a cost, which is measured not only in money spent but also in time, effort, and missed opportunities. So every step towards improving the legal system will lead to an improvement of both the business environment and the societal environment as a whole.

Fourth, Bulgaria should make efforts to effectively protect private property – a fundamental principle for a market economy and democracy, which is of key importance for every business and citizen of the country.

Fifth, there are, of course, several legal aspects and interrelationships between laws, administrative regulations, and judicial decisions at national and European levels that need to be taken into account in any idea of legislative change, as well as the rule of law and the search for meaningful public support, i.e.”- pointed out the motivation behind this project Omurtag Petkov, Chairman of the Committee “Rule of Law and Legislative Reforms”.

Rule of Law and Business Environment in Bulgaria Report 2023

The document includes four analyses by prominent jurists in Bulgaria, which explore four groups of issues concerning the business environment and the rule of law in Bulgaria.

The topic “What needs to change in criminal justice” was developed by Andrey Yankulov from the Anti-Corruption Fund.

The analysis focuses on the most important problems of the Bulgarian criminal justice system and proposes a concept for necessary solutions, based on the established European standard. Some of the proposals, which might seem controversial or even exotic given the established understanding in Bulgaria, are motivated by comparative law, drawing on the experience of other European countries.

The problems are discussed in several groups: the structure of the bodies of the system, respectively their powers and guarantees of control and counterbalance; the procedures in criminal cases, and the substantive criminal law.

The topic “Requirements of the Rule of Law and the Problems of Administrative Justice in Bulgaria” was developed by Doc. Hristo Hristev, Sofia University “St. Kliment Ohridski”

The analysis aims to answer the question of what are the main weaknesses of the rule of law in Bulgaria through the prism of guaranteeing the independence of the courts and the functioning of administrative justice. The focus of the text is on the peculiarities of the regulation and practice of the appointment of judges in Bulgaria, the process of their attestation, and the imposition of disciplinary sanctions on magistrates. The structure of the Supreme Judicial Council, as well as the phenomenon of “secondment of judges” is also the subject of study.

The analysis is of great importance given the adopted amendments to the Constitution of the Republic of Bulgaria of 20.12.2023, since, along with the weaknesses in the pre-existing constitutional framework, it examines several deficits in the framework of the Judiciary Act.

The topic “Protection of private property rights in the light of confiscation legislation in the Republic of Bulgaria” was developed by Adv. Georgi Atanasov, partner at Dokovska, Atanasov & Partners law firm.

The Bulgarian legal discourse has for years mistakenly used the term “civil forfeiture”, a linguistic borrowing from US law, to refer to the confiscation of illegally acquired property and in an attempt to find a link with the legal frameworks of relatively similar legal phenomena in the UK, the Republic of Ireland, Australia and other countries of the Anglo-American legal family. The model and the solutions adopted by the legislator are criticized and it is concluded that the uncritical implementation of a foreign legal model and experience in our legal system does not correspond either with the context of the countries from which it is borrowed or with the legal protection of citizens and their property.

Also, over the years, the inefficiency of the body that is supposed to work for the confiscation of illegally acquired property has been proven and its activities so far have led to violation of civil rights, disrespect for private property, and lack of results expected by the society and the state, while the budgets for its upkeep have been increasing enormously.

The topic “Analysis of the problems with the state fees in civil cases” was developed by pr. asst. Anastas Punev.

This topic examines the right of access to justice, which is constrained by the 1996 rules applied without regard to context, which set a minimum state fee of 4% of the total claim and set no upper limit. In essence, the stamp duty is part of the risk that the claimant assumes in bringing a case, and to this is added the risk of possible insolvency of the defendant.

A possible solution in this area is the application of German legal experience, which includes a detailed tariff calculation of the claim fee and has an upper threshold for it.

  • Executive Summary in Bulgarian of the report can be downloaded from this link.
  • Full version in Bulgarian is available here.
  • Executive Summary in English is available here.

The project is supported by the Center for International Entrepreneurship Support (CIPE).

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