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Amendments in the Act on Measures and Actions during State of Emergency, proclaimed by Decision of the National Assembly of 13 March 2020

In the State Gazette, Copy 34 dated 09.04.2020, there was promulgated Act on amendment and supplement (AAS) of the Act on Measures and Actions during State of Emergency, proclaimed by Decision of the National Assembly of 13 March 2020, promulgated in the State Gazette, Copy 28 dated 24.03.2020 (referred below to as AMADSE or the Act).

AMADSE enters into force as of 13 March 2020, with the exception of Art.5,§ 3, § 12, § 25 – 31, § 41, § 49 and § 51, which enter into force as of the day of promulgation of the Act in the State Gazette, and shall apply until the revocation of the state of emergency.

AAS of the Act shall enter into force as of the day of its promulgation in the State Gazette, with the exception of § 3, item 2 concerning Art. 4, Para 2, which shall enter into force within 7 days of its promulgation. Pursuant to § 13 of the Concluding Provisions of AAS of the Act, the actions performed from the proclamation of the state of emergency until the entry into force of AAS of AMADSE remain in force.

With regard to the prolongation of the state of emergency throughout the country until 13.05.2020, AAS provides for changes in the regulation of some of the public relations regulated by AMADSE and the measures provided therein. Some of the more important amendments and supplements under AAS of AMADSE shall be presented below, without claiming exhaustiveness.

1. Introducing court proceedings and cases, exhaustively listed in Appendix to Art. 3, item 1 of the Act, in respect of which the procedural terms shall not stop running:

Art. 3, item 1 of AMADSE has provided for that during the period from 13 March 2020 until the revocation of the state of emergency would stop running:

1. the procedural terms under judicial, arbitration and enforcement proceedings, with the exception of terms under criminal proceedings, under the Extradition and the European Arrest Warrant Act and proceedings relating to duress measures.

AAS of the Act specifies the exceptions and comprehensively introduces, in accordance with Appendix to Art. 3, item 1 of AMADSE, the court proceedings, respectively the cases, under which the procedural terms shall not stop running. The exceptions included in the Appendix are as follows:

Criminal court proceedings:

1. Cases under Art. 64 and Art. 65 of the Criminal Procedure Code and under Art. 270 of the Criminal Procedure Code; 2. Cases under Art. 66 of the Criminal Procedure Code; 3. Cases under art. 67 of the Criminal Procedure Code; 4. Cases under Art. 68 of the Criminal Procedure Code; 5. Cases under Art. 69 of the Criminal Procedure Code; 6. Cases under Art. 70 of the Criminal Procedure Code; 7. The measures under Art. 72 and Art. 73 of the Criminal Procedure Code; 8. Examination of an accused before a judge under Art. 222 of the Criminal Procedure Code; 9. Examination of a witness before a judge under Art. 223 of the Criminal Procedure Code; 10. Cases under Art. 427 of the Criminal Procedure Code; 11. Cases under Chapter Five, Section II of the Health Act; 12. Cases under the Extradition and the European Arrest Warrant Act on requests for the detention or handing over of persons; 13. Cases under the Act on Recognition, Enforcement and Sending of Judicial Acts for Imprisonment or Measures Including Imprisonment; 14. Cases under Art. 7 of the Decree on Combating Petty Hooliganism; 15. Cases under Art. 225, Para 6 of the Criminal Code; 16. Cases under Art. 326, Para 2 of the Criminal Code; 17. Cases under Art. 355 of the Criminal Code; 18. Cases constituted on requests under the Special Intelligence Means Act and Art. 159a of the Criminal Procedure Code; 19. The procedural actions by the order of Art. 146, Art. 158, Art. 161, Art. 164 and Art. 165 of the Criminal Procedure Code; 20.Cases for appealing or protesting penal decrees issued upon or in connection with the state of emergency; 21. Cases under Art. 437 of the Criminal Procedure Code on early release under Art. 70 and 71 of the Criminal Code.

 Civil and commercial court proceedings

1. Cases for exercising parental rights only in respect of temporary measures; 2. Cases under the Domestic Violence Protection Act only concerning an order for immediate protection or amendment thereof, as well as in cases where the request for protection is rejected; 3. Permits for withdrawal of deposits from childrens deposits; 4. Security proceedings; 5. Cases for securing evidence; 6. Requests under the Electronic Communications Act and Art. 19, Para 6 in connection with Para 5 of the Commercial Register and the Non-Profit Legal Entities Register Act in connection with Art. 536 of the Code of Civil Procedure; 7. Cases under Art. 62, Para 3 of the Credit Institutions Act.

 Administrative court proceedings

1.Cases under Art. 60 and Art. 166 of the Administrative Procedure Code; 2. Cases under Art. 75 and Art. 157 of the Tax and Social Insurance Procedure Code; 3. Cases under Art. 72 of the Ministry of Interior Act; 4. Security proceedings; 5. Cases for securing evidence; 6. Cases under Art. 111 of the Act on Execution of Punishments and Detention; 7. Cases under Art. 252 of the Administrative Procedure Code; 8. Cases under the Public Procurement Act; 9. Cases under the Concessions Act; 10. Cases under the European Structural and Investment Funds Management Act; 11. Cases under Chapter Three of the State Property Act and Chapter Three of the Municipal Property Act; 12. Cases under the Electoral Code; 13. Cases for appealing acts for establishing public receivables; 14.Cases under Art. 215 of the Spatial Development Act, related to appealing acts for building permits issued and for approved and / or amended detailed development plans; 15.Cases for appealing or protesting administrative acts issued upon or in connection with the state of emergency; 16.Cases under Chapter Thirteen of the Administrative Procedure Code;

2. Suspension of the prescription terms:

Pursuant to Art. 3, item 2 of AMADSE, during the period from 13 March 2020 until the revocation of the state of emergency there shall stop running:

2. the prescription and other terms provided for in statutory acts, with the expiry of which rights shall be extinguished or terminated or obligations shall arise for individuals, with the exception of the terms under the Criminal Code and the Administrative Violations and Penalties Act;

Pursuant to AAS of AMADSE during the period from 13 March 2020 until the revocation of the state of emergency only the prescription terms with the expiry of which the rights of private-law entities are extinguished or acquired, shall stop running.

3. Revocation of the suspension of the terms for compliance with instructions given by the administrative authority to parties or participants in administrative proceedings constituted.

Pursuant to Art. 3, item 3 of AMADSE for the period from 13 March 2020 until the revocation of the state of emergency there shall stop running:

3. the terms for compliance with instructions given by an administrative authority to parties or participants in proceedings, with the exception of proceedings under the European Structural and Investment Funds Management Act.

Item 3 of Art. 3 is revoked by AAS of the Act.

4. The terms under Art. 3, item 1 and item 2 with respect to “other terms” in the previous edition of AMADSE and on the revoked item 3, suspended from the proclamation of the state of emergency until entry into force of AAS of AMADSE, shall continue to run after expiry of 7 days as of its promulgation in the State Gazette.

5. Exceptions (explicitly specified administrative proceedings) are provided for in respect of which the terms under Art. 4 of AMADSE shall not be prolonged by one month as of the date of revocation of the state of emergency:

Pursuant to Art. 4 of AMADSE there shall be prolonged by one month after the revocation of the state of emergency:

1. the terms specified by law, other than those under Art. 3, which expire during the state of emergency and are related to the exercise of rights or fulfillment of obligations of private-law entities;

2. the effect of the administrative acts, which is limited by term and expires during the state of emergency.

This provision shall not apply in respect of the terms and proceedings under §49 of the TCP of AMADSE on establishment, declaration, deposit, securing and collection of customs debts, taxes, including excise duties, compulsory social security contributions for the state social security funds, health insurance, the Teachers’ Pension Fund and the supplementary compulsory pension funds, state and municipal fees and other public receivables regulated by the Tax and Social Insurance Procedure Code, the Customs Act, The Excise and Tax Warehouses Act, the Value Added Tax Act, the Corporate Income Tax Act, the Natural Persons Income Tax Act, the Local Taxes and Fees Act, the Social Security Code, the Health Insurance Act and the Gambling Act, which remain unamended, except for the cases under § 25 – 31 of the TCP of AMADSE.

A new Para 2 of § 49 of AAS of AMADSE is created, by which there shall not be changed the terms under the Markets of Financial Instruments Act, the Public Offering of Securities Act, the Act on the Activity of Collective Investment Schemes and Other Enterprises for Collective Investments, the Special Investment Purpose Companies Act, the Financial Supervision Commission Act, the Insurance Code and Part Two of the Social Security Code, except for the cases under § 8 and § 44-47.

AAS of AMADSE provides for exceptions in respect of which the prolongation by one month, as of the revocation of the state of emergency, shall not apply for the terms specified in law and the effect of administrative acts. The exceptions introduced by AAS of AMADSE are as follows: proceedings related to award of public procurements, concession procedures, proceedings under the European Structural and Investment Funds Management Act, proceedings under Chapter Three of the State Property Act and Chapter Three of the Municipal Property Act, proceedings under the Farmers Support Act, proceedings under the Ownership and Use of Agricultural Land Act, proceedings under the Forest Act, proceedings under the Act on the Application of the Common Organization of the Markets of Agricultural Products in the European Union, proceedings under Veterinary Medicine Act, proceedings under the Spatial Development Act and proceedings under the Protection of Competition Act. The same rule shall apply to proceedings under the relevant sublegislative acts.

That provision of AAS of AMADSE shall enter into force within 7 days as of the promulgation of AAS of AMADSE.

6. Suspension of the terms under the Measures against Money Laundering Act (MAMLA)

New Article 24 of AMADSE is created by §10 of AAS, stipulating that until the revocation of the state of emergency there shall not run:

– The terms for adoption of internal rules under Art. 101 of MAMLA – for newly registered entities, for non-profit legal entities, which do not simultaneously fall into another category of obligated persons, as well as for persons whose activity is subject to licensing, permission or registration;

– The terms for notification of “Financial Investigation” Directorate to State Agency “National Security” and the relevant supervision authority on the implementation of policies and procedures for control and prevention of money laundering and terrorist financing – for persons who are part of a group of enterprises;

– The terms for establishment of specialized services under MAMLA and the terms for notification of SANS for appointment of the person or change of the employee who heads the specialized service – for the persons under Art. 4, items 1, 3, 5 and 8 – 11 of MAMLA;

– The terms for adoption of a risk assessment – for all persons, except for the non-profit legal entities with annual turnover exceeding BGN 20 000 (they shall adopt such risk assessment within 4 months from the revocation of the state of emergency;

7. Terms for submission of declarations of property and interests under the Act on Counteracting Corruption and Confiscation of Illegally Acquired Property Act (ACCCIAP) and the Judiciary System Act (JSA):

AAS of AMADSE provides for that in 2020 the declarations of property and interests submitted by the persons under the ACCCIAP, as well as the declarations of property and interests, submitted by the judges, prosecutors and investigators under the JSA, shall be submitted within one month after the revocation of the state of emergency.

8. Amendments related to the consequences of default of debtors:

Until now, Art. 6 of AMADSE has provided that until the revocation of the state of emergency, the consequences of delay for payment of obligations of private-law entities, including interests and liquidated damages for delay, as well as non-monetary consequences such as early payment, contract termination and seizure of property, shall not apply.

By AAS of AMADSE the above provision is amended, defining the circle of private-law entities in respect of which the harmful consequences of late payment until the revocation of the state of emergency shall not apply. These are: debtors under credit agreements and other forms of financing (factoring, forfeiting, etc.) provided by banks and financial institutions under Art. 3 of the Credit Institutions Act, including when the receivables are obtained from other banks, financial institutions or third parties, and under leasing contracts. The harmful consequences from which the debtors are exempt are explicitly specified (the list has not been exhaustive so far). In particular, it is provided for that in those cases: no interest for delay and liquidated damages shall be charged, the obligation cannot be declared early due and the contract cannot be rescinded due to default, as well as no belongings can be seized.

9. Supplement in respect of the measure 60:40:

§ 6 of AMADSE has provided that during the effect of the Act, for a period not exceeding three months, the NSSI shall transfer 60 percent of the amount of the insurance income for January 2020 for persons insured under Art. 4, Para 1, item 1 of the Social Security Code by insurers meeting the criteria set by an act of the Council of Ministers.

Pursuant to an amendment adopted in § 6 of AMADSE, NSSI shall also transfer 60% of the social insurance contributions due at the expense of the insurer.

10. Non-sequestration of incomes in enforcements proceedings under Tax and Social Insurance Procedure Code:

By the Concluding Provisions of AAS of AMADSE Article 213, Para 1, item 5 of TSIPC is amended, which defines the property on which enforcement cannot be directed under the order of TSIPC. Until now, the TSIPC has provided that no enforcement could be directed toward employment remuneration, thecompensation under the employment relationship, pension or scholarships – up to BGN 250 per month. Pursuant to the new edition of Article 213, Para 1, Item 5 of TSIPC, by the order of TSIPC enforcement cannot be directed towards the employment remuneration, the compensation under the employment relationship, any other remuneration for work, the pension or the scholarship – at the total amount up to the minimum monthly wage.

11. New obligations for tour operators:

AAS of AMADSE stipulates new provision according to which a tour operator, which has to reimburse an amount paid by traveler for tourist trip that has been canceled due to the state of emergency, may offer the traveler a voucher for the amount paid. In case the traveler does not accept the voucher and in case no other agreement for a tourist replacement package between the tour operator and the traveler exist, the tour operator shall be obliged to reimburse all payments received by the traveler or on his behalf within one month from the revocation of the state of emergency.

12. Reduced amounts of the fees for violation of the anti-epidemic measures:

The amount of the sanctions for persons who violated and failed to observe the anti-epidemic measures introduced by an act of the Minister of Health or the Director of the Regional Health Inspectorate in case of epidemic situation, has been reduced.

So far, individuals were subject to a fine at the amount of BGN 5 000, and the sole merchants and legal entities – to a pecuniary sanction at the amount of BGN 15 000. AAS provides that the fines for individuals shall range from BGN 300 to BGN 1 000 (and in the event of a repeated violation from BGN 1 000 to BGN 2 000). Legal entities and sole merchants shall be imposed with pecuniary sanctions at the amount from BGN 500 to BGN 2000 (and in case of repeated violation from BGN 2000 to BGN 5000).

Thе present statement does not constitute legal advice or consultation, but rather our own interpretation and analysis of the issues outlined above.

The team of Dyulgerova & Penkova Law Firm