Transformation. Administrative Justice for Business: Energy and Mining Industry – OVERVIEW & VIDEO

On June 20, 2024, the American Chamber of Commerce in Bulgaria and the Association of the Bulgarian Administrative Judges organized a joint discussion on some of the critical topics of the Administative Justice domain that impact the Energy and Mining Sectors in the country.

The event was opened with short remarks by Ivan Mihaylov, CEO, AmCham Bulgaria and Lyubomir Gaydov, Chairman, Association of the Bulgarian Administrative Judges. Both of the underlined that this is the second joint event between both organizations in 2024 at which members of their associations engage in in-depth discussion and build-up of institutional dialogue on important for the both professional groups matters.

In the first panel, entitled: “Administrative acts with unclear status in the field of energy and their appealability – strategies, instructions, etc.”, on focus was the judicial procedures and proceedings under the Еnergy Act and aspects of European law. It included two speakers’ remarks. First was Mario Dimitrov, Judge, 3rd Unit, Supreme Administrative Court who made a thorogh overivew of the national and EU administrative acts that govern the Energy and Mining Sectors. It was followed by practical statement by attn. Anton Krastev, Energy Expert, Djingov, Gouginski, Kyutchukov, and Velichkov

The second panel “The role and involvement of expert witnesses and the full use of their expertise in the adjudication of energy cases by administrative courts and the Supreme Administrative Court”, focused on non-compliance with court decisions in proceedings under the Energy Act and the Renewable Energy Act, on State and Municipalities Liability for Damages Act (ЗОДОВ) – damages for the business, as well as on tacit refusal. Speakers were Judge Aglika Adamova, Supreme Administrative Court and att. Atanas Valov, Penkov, Markov & Partners

Presentations in-detail

Atanas Valov’s remarks

Atanas Valov, Partner at Penkov, Markov & Partners Attorneys at law. He is Head of the Litigation and ADR Practice of the law firm, specialized in construction and commercial disputes before the general courts and arbitration institutions, as well as in construction-related administrative disputes and energy-related litigation (both administrative and civil) and arbitration. Member of Sofia Bar Association with more than 13 years of practical experience in the above spheres.

Photo: Atanas Valov is with beige jacket

Remarks

1. A significant problem is the delay of the administration in the conduct of the intermediate phases of the procedures for issuance of administrative acts and coordination of investment initiatives, which delays are not tacit refusals as per their legal nature and are not subject to appeal on their own.

2. The administrative courts are not yet willing to award damages under the Act on the Liability of the State and the Municipalities for Damages for compensation of lost profit from failed sales or re-sales of the RES projects (damages for missed opportunity for disposal with the investment), as they consider these damages a typical economic risk associated with the investment process.

3. In some case the practice of the Supreme Administrative Court is unpredictable and similar cases are being treated differently – some examples are:

a) the cases of the RES producers – operators of water electricity plants which have been affected by the abolition of the pricing decisions of the Energy and Water Regulation Commission (EWRC) from 2011 and 2015 due to the discriminatively lowered purchase price of the energy they have been producing;

b) the cases against Decision C-1/2022 of EWRC for the decrease of the premium payments to the RES producers due to excessive profits, part of which cases were terminated as inadmissible and others were not.

c) the cases under the campaign for appeals of decisions SP-1 to SP-6 of EWRC from 2019 for determination of Net Specific Production of the RES producers, which has been determined in absolutely the same parameters as the ones under SP1/2015, which has been abolished by the Supreme Administrative Court.

4. The problem with the abolition of tacit refusals or abolition of the administrative act due to procedural omissions of the administration and the respective return of the case to the administration for new review stems from the ineffectiveness of the means of defense against arbitrariness of the administration in the review of similar cases.

5. The competent administrative bodies in the energy sector such as EWRC often does not conducts adequate dialogue with the business on the adopted normative administrative acts, which results in deformation of the market mechanisms and affecting of the legal interests of most of the market participants, while a narrow group of State controlled entities like Electricity System Operator (ESO) and the National Electricity Company benefit from the created market deformations.


Moments from the discussion


Watch the full recording of the discussion