site.btaRecovery and Resolution of Credit Institutions and Investment Firms Act Amended on First Reading

Bulgaria's National Assembly on Thursday voted, 165-5 with five abstentions, to pass on first reading a Bill to Amend and Supplement the Recovery and Resolution of Credit Institutions and Investment Firms Act.

According to the reasons, part of the revisions meet the requirements of a EU regulation as regards the prudential treatment of global systemically important institutions with a multiple-point-of-entry resolution strategy and methods for the indirect subscription of instruments eligible for meeting the minimum requirement for own funds and eligible liabilities. The requirements in questions should have been transposed into national legislation by November 15, 2023. On July 25, 2024, Bulgaria received a letter of formal notice from the European Commission on starting an infringement procedure against Bulgaria for failing to inform the Commission in due time of the measures taken for the implementation of Regulation (EU) 2022/2036 of the European Parliament and of the Council of 19 October 2022.

The movers of the bill point out that the Final Provisions propose amendments to the Bank Insolvency Act addressing the need to take action for implementing a judgment of the European Court of Human Rights (ECtHR) in the Case of International Bank for Commerce and Development AD and Others v. Bulgaria (Application no. 7031/05) and a Roadmap for the Implementation of the Judgments Rendered by the ECtHR against Bulgaria, adopted by a Council of Ministers decision of 2021, as well as the need to repeal certain extrinsic and unensured powers of the minister of finance in bank insolvency proceedings.