site.btaJune 25: Sofia Commodity Exchange Inaugurated 35 Years Ago

Thursday marks the 35th anniversary of the inauguration of the Sofia Commodity Exchange (SCE) - the first such trading venue in Bulgaria's contemporary history and a market leader to date.

The Exchange was established on April 11, 1991 as a non-profit, non-governmental unincorporated civil-law partnership under the Obligations and Contracts Act by 13 founding members (institutions, banks, companies, and industry associations).

The SCE revived a market of the same name that was established in December 1925 and endorsed by a Royal Decree on May 13, 1926. The operation of this and all other commodity exchanges in Bulgaria was suspended in 1941 because of the war.

After the inauguration of the SCE on June 25, 1991, its membership grew to over 50 within months. The first trading session took place on July 2, 1991, when the first commodity-exchange transaction in post-communist Bulgaria was concluded, too, with approximately a truckload of chocolate imported from Germany selling for BGL 40,000-50,000. Before long, the Exchange attracted huge interest as a source of reliable information on the prices of particular goods.

After the Commodity Exchanges and Wholesale Markets Act was adopted on October 17, 1996 and gazetted on November 1, 1996, in January 1998 the SCE Management Board decided on transforming the Exchange into a joint-stock company with equity capital of BGL 270 million, divided into 2,700 registered shares and offered for subscription to banks, agricultural producers and traders. The new company, incorporated on August 5, 1998 by 91 corporate investors, consolidated all 12 exchanges affiliated to the Association of Commodity Exchanges in Bulgaria, enabling the SCE to increase its market share in the country's exchange trading to over 90% as from 1997. The SCE was certified as a commodity exchange by the State Commission on Commodity Exchanges and Wholesale Markets on November 10, 1998 and was licensed on November 1, 2007. It increased its capital ten-fold in 2008.

In 2026, the SCE has 34 shareholders and a paid-up capital of EUR 1.38 million. The Exchange lists 55 member entities with over 100 active brokers, who represent over 1,600 end buyers and sellers. During its 35 years, the Exchange has trained more than 4,000 commodity brokers. The turnover for the last five years has topped EUR 1.5 billion. All trades are financially secured through the SCE clearing system, which operates on the basis of margin deposits.

Physically available commodities are traded on the Exchange. They are allocated to three trading rings: grains, foodstuffs, and industrial goods. Trades are either spot (for immediate delivery) or forward (for delayed delivery). They are concluded during trading sessions, either in person on the floor of the SCE or remotely, via a state-of-the-art online trading platform, a pilot version of which was launched in December 2024.

Trade disputes are referred for settlement to an Exchange Arbitration, which is officially listed by the Ministry of Justice.

As early as 1991, the SCE contacted counterparts in Eastern Europe and the rest of the world. It maintains contacts with two of the largest commodity exchanges globally: the Chicago Board of Trade (CBOT) and the Chicago Mercantile Exchange (CME).

In November 1997, the CBOT expressed interest in acquiring a 5% stake in the SCE (the maximum possible under the law), but the proposed acquisition apparently remained at the level of negotiations or an expression of intent and was not finalized.

The SCE joined the Association of Futures Markets (AFM), first as an associate member in 2005 and then as a full member in 2008.

The Exchange ensures a level playing field for all market participants, creates fair conditions for transparent business, promotes free competition, and identifies the realistic price trends, thus effectively regulating the commodity market and reflecting the real condition of the economy.

Following is the original news item in English by which BTA's External Service marked an earlier anniversary of the SCE - the eighth - in 1999:

BULGARIA-COMMODITY EXCHANGE-ANNIVERSARY
Electronic Trade Is Priority for Sofia Commodity Exchange

Sofia, June 25 (BTA) - The Sofia Commodity Exchange (SCE), which marked its eighth anniversary on Friday, has set itself the following goal: to start trading in options for the Bulgarian Stock Exchange indexes, interest and currency.

The Commodity Exchange needs some 200,000 US dollars to introduce an electronic trading system which is indispensable for the trade in financial instruments, SCE Director Vassil Simov said. The sum is not so large, but the management wants to attract a strategic investor for carrying out the project.

The Chicago Board of Trade, which is implementing similar projects in Poland and Turkey, has agreed in principle to provide equipment and know-how in return for a stake in the SCE. In order to invest, however, the American institution expects the Bulgarian Government to support the concentration of exchange trade, Simov said.

The first Bulgarian commodity exchange was set up in Varna (on the Black Sea coast) in 1902 under King Ferdinand's decree, Simov said. By 1928, four commodity exchanges had emerged in the country - the one in Varna, and the other in Bourgas (on the Black Sea), Rousse (on the Danube) and Sofia. Unlike the international practice, the Bulgarian commodity exchanges before World War II were entirely state-run. The law required that all deals involving imports and exports of agricultural produce be closed at the exchange.

Wholesale market trade was disrupted during World War II, to be restored 50 years later, in 1991. In 1948 the operation of commodity exchanges was officially banned, thus breaking the continuity between generations of professionals in this field.

In 1991, the founders applied the international principles - independence from state and private interests, independence of the exchange administration from its members.

The Sofia Commodity Exchange considers the number 13 to be a lucky one. On June 25, 1991, 13 founders and 13 brokers gathered at 13:00 hrs in Hall No 13 of the National Palace of Culture (NDK) to inaugurate the new commodity exchange. /EAM/VE/ 12:57:16 25-06-1999