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McGregor & Partners Newsletter – april 2016

In focus in Bulgarian legislation

Ordinance for amendment and supplement of Ordinance № 1/2007 for keeping, preservation and access to the Commercial register (SG 12 of 2016)

The amendments in the Ordinance are the consequence of the more frequent abuses with data in the Commercial register, as well as the increasing number of the thefts of companies, performed through manipulation of the registration documents, submitted electronically into the Commercial register. The amendments encompass the possibility, that the registration officials shall be entitled to have an unlimited access to the National data-base “Population”, supported by the Ministry of Regional Development and Public Works, in order to establish and check the data regarding the civil registration of the persons, as well as an access to the Notarial Chamber, in order to establish and check the notary verified documents.

The amendments enter into force as of 13.04.2016.

Project for Law of e-identification

The Bill aims to govern the public relations regarding the e-identification of individuals, in order a higher level of effectiveness of the functioning of the e-government in Bulgaria to be reached, orientated to the citizens and the business. The e-identification is defined as a process of using of e-data for the identification of individuals. The used data represents the identified individual in a unique way. The possibility for e-identification is provided for every individual (Bulgarian or foreign citizen, resident in Bulgaria) – user of e-services. An opportunity shall be given to the individuals from the aforementioned categories to possess a unique identification (E-identification) for which at their own discretion and based on the individuals’ specific needs, one or more certificates for electronic identity shall be issued. The certificate for E-identification shall be issued for 3 years validity period. In view of the protection of the rights of the electronic holder of an electronic identity, a possibility shall be provided for interruption of the certificate in the presence of reasonable doubt of the security violation, relating to its unlawful use.

The Bill is adopted by the National Assembly on a first reading.

News on European Union Law

European Commission presents the EU-U.S. Privacy Shield

In order to fill the gap in the procedures for transfer of personal data from the EU Community to USA occurred after the annulment of the Safe Harbor Principles with decision of the CJEU, at the end of February 2016, the European Commission published its project for the “EU-U.S. Privacy Shield”. The intention is to establish a new legal framework for the transatlantic transfers of the data. The announced text provides for guarantees that the standards for data transfers according to the new EU-U.S. Privacy Shield are equivalent to the standards for data protection in EU. The new legal framework should be based on:

  • robust enforcement and strong  obligations on companies   containing supervision mechanisms to ensure that companies respect their obligations, including sanctions or exclusion if they do not comply;
  • clear safeguards and transparency obligations on U.S. government access to personal data;
  • several possibilities for protection of the EU rights including shorter terms for complaints resolution and free of charge alternative dispute resolution solution;
  • Annual joint monitoring of the functioning of the Privacy Shield.

Proposal for EU Trade Secrets Directive

А provisional agreement has been reached on the text of a new Directive on the protection of undisclosed know-how and business information (trade secrets) against their unlawful acquisition, use and disclosure. The purpose of the Directive is to set out a minimum standard comparable level of legal remedies within the internal market in case of misappropriation of trade secrets while ensuring sufficient safeguards to prevent abuse. The text elucidates that “trade secrets” comprise information that: (i) is confidential, in that it is not generally known among or readily accessible to relevant persons in the field; (ii) has commercial value and its unauthorised use or disclosure would undermine the holder’s scientific/technical potential, financial interests, strategic position or ability to compete; and (iii) has been subject to reasonable steps to keep it confidential. The acquisition, use or disclosure of a trade secret shall be considered unlawful whenever carried out, without the consent of the trade secret holder, intentionally or with gross negligence, by a person who has acquired the trade secret unlawfully, who is in breach of a confidentiality agreement or any other duty to maintain secrecy of the trade secret or who is in breach of a contractual or any other duty to limit the use of the trade secret.

Court practice

The Supreme administrative court cancelled the high fees for the appeal of the public procurement procedures.

The Supreme administrative court (SAC) finally cancelled Decree № 196/10.07.2014 of the Council of Ministers, which Decree approved the Tariff of the fees collected in regard with the appeal of the public procurement procedures, The above mentioned amendments provided significant increase of the state fees, owed to Commission for Protection of the Competition and the SAC, in some cases even an increase up to 17 times up to the amount of BGN 15 000.

A five-member chamber of SAC confirms the first instance decision of a three-member chamber, which concluded, that a serious administrative procedural violations were omitted, as well as the significant increase of the fees is not grounded neither with an increase of the value of the services delivered, nor with an increase of the revenues of the citizens and the legal entities.

Statement of the CPC regarding §54 of the Transitional and Final Provisions to the Law on amendment and supplement of the Energy Act, prom. SG 17 as of 2015

With Decision № 212 as of 30.03.2016, the Commission on Protection of Competition (CPC) adopted an statement in relation to the effect of §54 of the TFP to the LAS of the EA on the competition, which provision provides for that the promotions under the Law on the Energy from Renewable Sources (LERS) shall not apply to energy facilities for production of electricity from renewable sources, which are placed in service after the entry into force of the law. The incentives adopted in LERS represent direct support through preferential prices and long terms for the purchase of electricity. In the course of the conducted investigation CPC found that in order to regain their investments, the producers who have chosen to produce electricity from renewable sources to be sold at preferential prices and under long-term purchase agreement, initially have considered in their investment plans the support schemes provided in LERS. The adoption of the provision of § 54 of the TFP to LAS of EA is likely to compromise the investment plans of these producers who at the date of entry into force of this provision have not completed the process of construction of their facilities for the production of energy from renewable sources. According to the Commission, that provision directly affects the legitimate expectations of producers who begun to implement their investment plans. This amendment to the legislation creates legal uncertainty that is likely to have a negative impact on economic activity of companies and it could restrain the entry of new market participants.

This statement of the Commission, however, has no binding effect. Its purpose is to worn for any possible negative influence of the provision on the competition.