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McGregor & Partners Newsletter – August 2015

In focus in Bulgarian legislation

Law on supplement of the Code of Civil Procedure, (SG 50 as of 03.7.2015)

The adopted provisions perceive the mechanism of Regulation (EU) No 1215/2012 of the European Parliament and of the Council of 12 December 2012 on jurisdiction and the recognition and enforcement of court decisions in civil and commercial matters.

In this respect, the adopted Law on supplement of the Code of Civil Procedure defines the competent court before which citizens can exercise their rights under the regulation, relating to the filing of an application for refusal of recognition or lack of grounds for this or an application for refusal of enforcement of foreign court decisions. The adopted law introduces important changes in the warrant and execution procedure and provides a term to approve the requirements for exchange of electronic distraint, which will allow imposition of an electronic distraint over a receivable under a bank account without unnecessary costs.

Law on supplement of the Labour Code, (SG 54 as of 17.7.2015)

What are the changes?

Young people between 16 and 18 years old can already work up to 22 hours instead of 20 hours, as such restriction was there so far.

Introduced are new types of employment contracts – for short-term seasonal agricultural work. Their duration is one day and they will be certified by the General Labour Inspectorate. Their practical application is regulated by a special ordinance, which is also published in State Gazette No54.

New rules in the implementation of flexible working hours are regulated. According to them, the employer will continue to determine time for required presence of workers and employees, but the hours outside can be worked out on every other day of the week. The way of reporting of working time is regulated by the rules for internal labour order of the undertaking. The control will monitor whether, in the distribution of the working hours and the working out of the hours on other days, the requirements for mandatory daily or weekly rest period are followed.

The obligation of employers to prepare schedules for holidays has been repealed.

The employers are required to keep employment records of their workers and employees, in which documents are stored in connection with the occurrence, existence and termination of the employment relationship.

Special rules for micro and small undertakings are introduced, as they will no longer be able to introduce longer working hours when necessary, as well as reduced working hours in industrial problems.

Law on supplement of the Energy Sector Act (SG 56 as of 24.7.2015)

After entering on 14.07.2015 in the NA of a unified bill, prepared under art.77, para.2 of the ROPNA, on the basis of the adopted at first reading two bills, on 24.07.2015 the Law on supplement of the Energy Sector Act was published in the SG.

Review of the changes:

For managing of the funds to cover the costs, incurred by the public provider, stemming from its obligations under art. 93a, determined by the commission, including for past regulatory periods a fund “Safety of the electricity system” is established.

The payment to the public provider to cover the costs with funds from the fund shall be carried out monthly.

The funds of the fund are raised from:

  1. the contributions under art. 36e;
  2. the revenues, received from the tenders for sale of quotas under art. 57, para. 1 of the Law for limiting the climate change, which are used for development of renewable energy sources
  3. the revenues from interests, including arrears of contributions under item 1;
  4. donations;
  5. the revenues from statistical transfers of energy from renewable sources, which are used for the development of renewable energy sources.

The funds are spent for maintenance, related to the activity of the fund and for payment of funds to cover the costs, incurred by the public provider, stemming from its obligations under art. 93a, determined by the commission, including for past regulatory periods.

Contributions to the fund in the amount of 5 percent are made monthly by:

  1. the producers of electricity from the revenues from electricity sold without VAT;
  2. the traders that import electricity from the revenues from imported and sold on the national market electricity without VAT.

The producers of electricity and the traders that import electricity on the national market submit to the fund until the 5th day of the current month information about the revenues under para. 1 for the previous month.

The contributions to the fund shall be paid by the 15th day of the month, following the month to which they relate and are recognized as current expenses for tax purposes.

For the purposes of the price regulation in the composition of the costs, recognized by the commission, the expenses for contributions under para. 1 are not included.

The contributions under para. 1, are public state receivables, as the unpaid within the term contributions, are established and collected under the Tax and Social Insurance Procedure Code by the National Revenue Agency.

The funds and operations of the fund are included in the consolidated fiscal program as means and operations of other economically autonomous entities under art. 13, para. 4 of the Law on public finances and are not part of the state budget.

The funds, provided for payment of the costs, incurred by the public provider cannot be subject to interception and are inaccessible.

The Council of Ministers determines with ordinance the order and manner of raising, spending, accounting and control of the funds of the fund.

The public provider, respectively the end suppliers purchase electricity produced from renewable sources under the following conditions:

  1. at a preferential price for the quantities of electricity to the amount of the net specific production of electricity, based on which are defined preferential prices in the relevant decisions of CEWR; for the objects under art. 24, item 3 the net specific production of electricity does not apply;
  2. at a price for excess of the balancing market for the quantities, exceeding the production under item 1.

The quantities of electricity over those under para. 5, item 1 the producers can use to supply their branches, enterprises and objects, or to sell at freely negotiated prices under chapter nine, section VII of the Energy Sector Act and /or on the balancing market.

Law on supplement of the Protection of Competition Act (SG 56 as of 24.7.2015)

In part two, there is regulated a new chapter seven “a” with art.37a “Abuse of a stronger position in negotiations“, according to which every act of omission of an undertaking with a stronger position in negotiations shall be prohibited, where it is in conflict with the fair business practice and is damaging or can impair the interests of the weaker part in negotiations or of consumers. Unfair shall be acts of omission which do not have objective economic grounds, such as unjustified refusal to be delivered or purchased goods or services, imposition of unreasonably heavy or discriminatory conditions or ungrounded termination of business relations. The existence of a stronger position in negotiations shall be determined in view of parameters of the structure of the respective market and particular legal relationship between the involved undertakings, taking into consideration the level of dependence between them, the nature of their business and the difference in the scale thereof, the feasibility of finding of an alternative business partner, including the existence of alternative supply sources, distribution channels and/or customers.

News on European Union Law

Commission Implementing Regulation (EU) 2015/1051 of 1 July 2015 on the modalities for the exercise of the functions of the online dispute resolution platform, on the modalities of the electronic complaint form and on the modalities of the cooperation between contact points provided for in Regulation (EU) No524/2013 of the European Parliament and of the Council on online dispute resolution for consumer disputes is published in the EU Official Journal – L171 02.07.2015, with which the European commission has adopted the regulation, laying down the modalities for: the electronic complaint form; the exercise of the functions of the ODR platform; the cooperation between the ODR contact points. The electronic complaint form to be submitted to the ODR platform shall be accessible to consumer and traders in all the official languages of the institutions of the Union. The complainant party shall be able to save a draft of the electronic complaint form on the ODR platform. The draft shall be accessible and editable by the complainant party prior to submission of the final fully completed electronic complaint form. The draft of the electronic complaint form that is not fully completed and submitted shall be automatically deleted from the ODR platform six months after its creation.

A request for a preliminary ruling from the Supreme Court of Cassation (Bulgaria) lodged on 11 May 2015 is published in the EU Official Journal – C236 20.07.2015 (Case C-215/15). Referring court is the Supreme Court of Cassation, while parties to the main proceedings are: appellant in cassation – Vasilka Ivanova Gogova; respondent in the appeal in cassation: Iliya Dimitrov Iliev. The following questions are referred: 1.Does the possibility, provided for by law, for civil courts to resolve a dispute between parents concerning their child’s ability to travel abroad and the issue of identity documents, where the applicable substantive law requires that those parental rights to be exercised jointly with regard to the child, constitute a matter relating to ‘the attribution, exercise, delegation, restriction or termination of parental responsibility’ within the meaning of art.1 (1) (b), in conjunction with art.2 (7), of Council Regulation (EC) No2201/2003 concerning jurisdiction and the recognition and enforcement of judgments in matrimonial matters and the matters of parental responsibility to which art.8 (1) of that regulation applies? 2.Do grounds establishing international jurisdiction apply in civil cases concerning parental responsibility where the decision replaces a legal act central to an administrative procedure concerning the child and the applicable law provides that this procedure must take place in a specific EU Member State? 3.Must it be assumed that there is a prorogation of jurisdiction within the meaning of art.12 (1) (b) of Regulation (EC) No2201/2003 where the respondent’s representative has not challenged the jurisdiction of the court but where that representative has not been authorized by the respondent but rather appointed by the court owing to the difficulty in notifying the respondent in order that he might participate in the proceedings in person or through a representative instructed by him?

Court practice

With interpretative decision 2/2013, the Supreme Court of Cassation ruled on a number of issues related to the problems of enforcement, relating to which there is controversial practice of courts in interpreting and applying the law.

Among the affected issues, the following stand out:

  • the admissibility of attachment of distraint or injunction over an inaccessible property;
  • the admissibility of scheduling a public sale of property of the debtor, when at the time of the attachment or injunction, there is information about other imposed distraints or injunctions over the same property;
  • the scope of the imposed distraint on salary or other remuneration for work, as well as on pension on the receivable of the debtor from the third obliged party to the minimum wage;
  • the order in which the receivable is satisfied, secured by a mortgage registered after the registration of injunction over the property and others.