BULGARIA’S PARLIAMENT PASSED THE AMENDMENTS TO THE BANK INSOLVENCY LAW

On 18th of March, Bulgaria’s Parliament passed the amendments to the bank insolvency law which were proposed in relation to the Corporate Commercial Bank (CCB) case.

Last week, Prime Minister Boyko Borissov said in Parliament that such amendments would ensure protection of the CCB assets and would guarantee the public interest.

The amendments provide for appointment of a temporary trustee in bankruptcy, without opening of bankruptcy procedure in the bank, which license had been revoked.

The trustee will have powers to represent the bank, to manage its daily activities and its property, to make requests for termination, dissolution or making void of deals, to which the bank is a party. With the consent of or at the proposal of the management board of the Bulgarian Deposit Insurance Fund (DIF), entities with relevant international experience in investigation of bank failures will be assigned to recommend actions to the trustee regarding the protection and seeking the return of bank assets, which were disposed of in violation of the law.

The changes also envision the trustees to prepare weekly reports on their activities and the reports will be published on the DIF website to maintain transparency.

MPs from the various parliamentary groups reached a consensus that the amendments were necessary in order to address the circumstances in the failed Corporate Commercial Bank.