At today’s meeting of 02.11.2021, the FSC decided to initiate proceedings for the issuance of a general administrative act – Decision to determine the amount of contributions to the Guarantee Fund under Art. 554, item 1 of the IC in the Uninsured Vehicle Fund and the contribution under Art. 563, para. 2, item 3 of the IC in the Security Fund in 2022, as well as the deadlines for their implementation.

The Guarantee Fund manages two funds – the Uninsured Vehicle Fund and the Security Fund. The Uninsured Vehicle Fund pays compensation in case of damage from an unidentified motor vehicle or, if the driver is without Motor Third Party Liability Insurance, and the Insurance Fund pays claims to persons with an insolvent insurer.

At present, the contribution to the Uninsured Vehicle Fund is BGN 10.50 for each insured motor vehicle under Motor Third Party Liability and BGN 0.15 for each seat in a public transport vehicle for Public Accident Insurance for Passengers in Public Transport. The contribution to the Security Fund is BGN 2.50 for each vehicle insured for Motor Third Party Liability.

At the proposal of the Guarantee Fund Council, the contribution of insurers offering in the Republic of Bulgaria compulsory motor third party liability insurance to the Fund for Uninsured Motor Vehicles in the Guarantee Fund remains at BGN 10.50 for each insured motor vehicle. The amount of the contribution of the insurers who offer in the Republic of Bulgaria compulsory Accident insurance for the passengers in public transport under Art. 461, item 2 of the IC also does not change and remains BGN 0.15 for each seat, excluding the driver’s seat in the vehicles.

The contribution to the Security Fund also remains BGN 2.50 for each insured vehicle under the Motor Third Party Liability.

The total contribution to the GF of each insured motor vehicle under the Motor Third Party Liability remains BGN 13.00, which is distributed in the two funds in question.

Pursuant to Art. 66, para. 1 of the APC, the opening of the proceedings for issuing the general administrative act shall be announced publicly by publishing the draft act on the FSC website in the section “Public consultations”.

Pursuant to Art. 69, para. 1, item 1 of the APC, the form for participation of the interested parties in the procedure for issuing the act is “Written proposals and objections”.

Pursuant to Art. 69, para. 2 of the APC, the term for submitting the written proposals and objections is one month from the date of publication of the announcement for initiating the procedure for issuing the administrative act on the FSC website and expires on 02.12.2021 inclusive.

To clarify the reporting of information by investment firms in accordance with the applicable requirements of Regulation (EU) 2019/2033 of the European Parliament and of the Council of 27 November 2019 on the prudential requirements of investment firms and amending Regulations (EU) No 1093/2010, (EU) No 575/2013, (EU) No 600/2014 and (EU) No 806/2014 (Regulation (EU) 2019/2033), the Financial Supervision Commission shall inform investment firms of the stage of implementation of the new prudential supervision at European level and the expected reporting format. Investment firms are provided with template reporting forms developed by the European Banking Authority, as well as information on draft regulatory technical standards, available on the websites of the European Banking Authority and the European Commission.

Draft regulatory technical standards based on Regulation (EU) 2019/2033 are available on the European Banking Authority’s website here.

Draft regulatory technical standards based on Regulation (EU) 2019/2033 are available on the European Commission’s website as follows:

Draft Delegated Regulation with regard to regulatory technical standards specifying the methods for measuring the K-factors;

Draft Delegated Regulation with regard to regulatory technical standards specifying the notion of segregated accounts to ensure client money’s protection in the event of an investment firm’s failure;

Draft Delegated Regulation with regard to regulatory technical standards specifying the methods for adjusting the K-factor “daily trading flow” (K-DTF);

Draft Delegated Regulation with regard to regulatory technical standards specifying the methods for adjusting the K-factor “clearing margin given” (K-CMG);

Draft Delegated Regulation specifying the criteria for subjecting certain investment firms to the requirements of Regulation (EU) No. 575/2013 of the European Parliament and of the Council of 26 June 2013 on prudential requirements for credit institutions and investment firms and amending Regulation (EU) No. 648/2012;

The applicable reporting forms developed by the European Banking Authority, as well as instructions for filling in, can be downloaded here.

You can send your questions on the implementation of the new prudential supervision to delovodstvo@fsc.bg.

In order to inform the supervised entities and the public in the Republic of Bulgaria and to the commitments made by the Financial Supervision Commission in the person of Boyko Atanasov, Chairman of the Commission to EIOPA and ESMA, the Communications Directorate presents the statement of the European Securities and Markets Authority (ESMA). The EU Securities Regulator explains the rules that apply when someone established inside or outside the EU disseminates information offering an investment solution for financial instruments issued in the EU (e.g. stocks or bonds) aimed at wide audience. Dissemination of information would involve, for example, sharing an opinion on the current or future price of a share.

In EU law, this is called an investment recommendation.

What is an investment recommendation? EU law defines an investment recommendation as information that recommends or proposes an investment strategy, directly or indirectly, on one or more financial instruments or their issuers, including opinions on the current or future value or price of such instruments intended for dissemination channels or for the public. Dissemination channels can be analytical reports, articles, traditional media or even social media.

Who should read this statement? Anyone who recommends investment in any way or form through any platform, and anyone who makes investment decisions based on investment recommendations made on any platform. This includes social media.

What’s the problem here? The possibility of investors being misled. Investment recommendations must be made in a specific and transparent way so that investors, before making an investment decision, can know and evaluate: 1) the reliability of the recommendation and its purpose; and 2) all the interests of the authors of the recommendations. In this way, everyone is free to express an opinion without harming other people in the process.

Who prepares investment recommendations? Usually companies such as banks and brokers, but also financial analysts. However, other persons proposing an investment strategy may be deemed to make an investment recommendation when the proposal is intended for wider dissemination. This includes social media posts. In addition, if someone often makes investment recommendations with the aim of reaching a wide audience and he presents himself as having financial expertise, this may mean that the person could be considered an expert. In this case, the law requires more disclosures.

Where are the rules? The rules are contained in EU Regulation (EU) No. 596/2014 on market abuse. They require those who make investment recommendations to disclose their identities, present recommendations in an objective manner and disclose any relationships or circumstances that could impair objectivity. Additional rules must be followed by experts.

What happens if the rules are not followed? EU regulators proactively monitor the behaviour, orders and transactions of market investors. An investigation shall be carried out if there are grounds for doing so. If the rules related to investment recommendations are not followed, fines or further supervisory actions may be imposed, which may include a referral to the prosecutor’s office.

The Financial Supervision Commission (FSC) informs all interested parties that at a meeting held on 26.10.2021 a decision was made to extend the deadline for submitting applications for admission to the examination for professional qualification of an insurance broker in accordance with Ordinance No. 28 of 10.05.2006 of the FSC, which will be held on 27.11.2021

The deadline for submitting applications has been extended to 01.11.2021, inclusive.

All interested persons should submit an application for admission to the examination according to an approved template, together with the attached documents under Art. 3, para. 2 of Ordinance No. 28 of 10.05.2006, namely: police clearance certificate or other similar document certifying the circumstances under Art. 303, para. 1, item 1 of the IC; a notarized copy of a diploma of higher education obtained in the country, respectively a legalized translation of a diploma of higher education obtained in a higher school outside the Republic of Bulgaria, to certify the circumstances under Art. 303, para. 2 of the IC and a declaration of the circumstances under Art. 303, para. 1, items 2 – 4 of the IC, according to a template.

Applications can be submitted every working day at the FSC office or signed with an electronic signature at the following e-mail address: delovodstvo@fsc.bg. A fee in the amount of BGN 450.00 (four hundred and fifty) shall be paid for taking the exam, based on Section I, item VI, line 15 in connection with Section IV, item IV of the Tariff of Fees Collected by the FSC under the Financial Supervision Commission Act, to the following bank account: IBAN: BG 95 BNBG 9661 3000 1415 01, BIC of BNB -Central office: BNBGBGSD.

The application must indicate the e-mail address to which messages on the open procedure for admission to the examination will be sent.

The topics covered by the examination are published on the FSC’s website, in the section “Supervised entities”, “Qualification examinations”, “Insurance brokers examinations”, where the list of admitted candidates will be announced, as well as all other announcements related to the conduct on this exam.

The examination will be conducted in accordance with all adopted anti-epidemic measures. In connection with Order No. РД-01-856 of 19.10.2021, supplemented on 21.10.2021, of the Minister of Health (MH) and in particular with item 2 and item 31, the admitted candidates should meet the requirement to be vaccinated or have recovered from COVID-19 or have a negative test result, certified by valid documents for vaccination, recovery or testing within the meaning of Order No. РД-01-733 of 27.08.2021 of the Ministry of Health.

The Financial Supervision Commission conducted the XIX edition of the educational program: The Non-Banking Financial Sector in Bulgaria in partnership with the Ministry of Education and Science (MES) and the Atanas Burov Foundation.

The program is specifically aimed at students and teachers in secondary schools of economics. For the second year, the event took place online in the form of three webinars on 8, 15 and 22 October. On the three consecutive Fridays in October, the following topics were presented: Social Insurance Market, Insurance Market and Capital Market. For the first time, students were introduced to several new topics, namely Consumer Protection, Fintech Business Models and Cybersecurity and Cryptocurrencies.

The educational program welcomed the presentations of experts from the FSC and experienced specialists from both the private and public sectors. Vladimir Tashkov – Executive Director of the Atanas Burov Foundation presented to the participants the activities of the Atanas Burov Foundation and the opportunity to apply for student scholarships. The Association of Bulgarian Insurers presented the essence of insurance, types of insurance and the insurance market in Bulgaria. The students also got acquainted with the activities of the Financial Supervision Commission which regulates the non-banking financial sector in Bulgaria.

The lecture was followed by a practical step in which the participants virtually visited a pension insurance and insurance company, an investment firm and the Bulgarian Stock Exchange, where they witnessed how the capital market works, understood the nature of insurance and why pension insurance is necessary.

During the opening of the educational program, Ms. Denitsa Kirova – Secretary General of the Financial Supervision Commission thanked all partners involved in the program. In her address to the participants, she noted that the implementation of this educational program is especially important for the Financial Supervision Commission, because it presents the functioning of sectors that are extremely important for the Bulgarian economy.

“I am addressing you – students, and I would urge you to be alert, to discover the world constantly and with curiosity, to constantly seek answers to the questions that concern you. “I believe that the educational program “Non-Banking Financial Sector in Bulgaria” will give you valuable knowledge and will answer many of your questions,” said Ms. Kirova.

Thirty students and twelve teachers from secondary vocational schools with economic and financial profile from the cities of Blagoevgrad, Burgas, Varna, Veliko Tarnovo, Vidin, Velingrad, Gorna Oryahovitsa, Gotse Delchev, Dryanovo, Kyustendil, Kardzhali, Montana, Pazardzhik, Petrich, Pernik, Plovdiv, Razgrad, Ruse, Svishtov, Silistra, Sliven, Smolyan, Sofia, Stara Zagora, Haskovo and Shumen took part in the XIX edition of the educational program.

The program “Non-Banking Financial Sector in Bulgaria” is one of a kind for our country. It is one of the longest-standing initiatives of the Financial Supervision Commission, launched since its inception and has become a true tradition. The aim of the educational program is for students from secondary vocational schools in Bulgaria to get an excellent opportunity for career guidance in the non-banking financial sector, as well as to increase their knowledge and financial literacy, this is one of the strategic goals of the Commission – consumer protection through financial literacy.

The program ended on October 22, after the third webinar, with a virtual presentation of certificates to participants.

The Financial Supervision Commission draws the issuers’ attention to the fact that the deadline for announcing a public notification of financial position for the third quarter of 2021 before the FSC and the media expires on 01.11.2021.

According to Art. 100 o1, para. 1 of the Public Offering of Securities Act (POSA), the issuer is obliged to submit to the FSC a public notification / report on its financial position for the third quarter of 2021 within 30 days from the end of the respective quarter. The public notification / report on the financial position of the company shall be submitted to the FSC by the procedure of Art. 100t, para. 4 of the POSA, namely through the unified system for providing information electronically – e-Register. The public notification / report on the financial position of the company shall be disclosed to the public in the manner provided in Art. 100t, para. 3 of the POSA, namely through an information agency or other media selected by the company within the statutory term, namely until 01.11.2021 inclusive.

The data presented from the reports of insurers in non-life and life insurance at the end of August 2021 are summarized and published on the FSC website – www.fsc.bg, section “Insurance Activity”, “Statistics”.

As part of the Financial Innovation Monitoring Strategy of the Financial Supervision Commission for the period 2021-2024, the FSC continues its commitment to develop and improve its supervisory activities together with other European regulators and actively seek harmonization of national regulatory frameworks and practices in the field of financial innovation, including the implementation of artificial intelligence models.

In this respect, guided by its principle of active communication and dialogue with supervised entities, the FSC undertook a study to identify key topics related to the benefits, challenges and development of AI. The aim is to analyse in more detail the innovation in question and outline the current and future direction of development through analysis, opinions and criticism.

A total of 106 supervised entities answered the questions. The most active are the insurance brokers – 81%, followed by the insurance companies – 16%.

The topics in the initiated discussion document were related to the trends in the development of AI, the benefits and disadvantages of implementation, as well as the challenges facing companies, namely: the investments they have to make and the level of service they have to offer. Last but not least, the opinion of the supervised entities was sought regarding their attitudes towards greater use of AI by the regulator, and the responses reflected a positive attitude towards the policy to support the implementation of AI by the supervisory authority.

The ambitious goals set by the FSC in the field of financial innovation require work in unison with the imposed European principles and according to the level of risk posed by the respective AI systems, requirements will be determined to meet the quantitative and qualitative data, human force involved in the process and approach of data validation, testing and documentation. The key to the introduction of an AI system will be clearly defined managerial responsibilities for the business process, the level of risk in outsourcing the service, ensuring impartiality of results, algorithms used in decision-making processes, eliminating opportunities for action related to legal violations.

The Chairman of the Financial Supervision Commission, Mr. Boyko Atanasov, expressed his gratitude for the commitment and high level of activity on the part of the participants in the study. He believes that the obtained results are extremely important for determining the current situation in the field of AI use and for outlining the framework in which to work effectively in integrating artificial intelligence and overcoming the challenges facing the non-banking financial sector in this regard.

The updated Financial Innovation Monitoring Strategy for the Period 2021-2024, published on the Financial Supervision Commission’s website, aims to establish a dialogue between the regulator and business, with a view to outlining possible future joint initiatives to integrate AI systems into the non-banking financial sector.

The presented data on the value and number of paid and filed claims under Motor Third Party Liability Insurance, including by risk groups, as of 30.09.2021 are published on the FSC website – www.fsc.bg, section “Insurance Activity”, “Statistics”, “Non-life Insurance”, “2021”. The data do not include insurance contracts that are concluded by insurers under the right of establishment or under the terms of freedom to provide services.

The Financial Supervision Commission (FSC) informs all interested parties that at its meeting held on 05.10.2021 a decision was made to conduct an examination for professional qualification of insurance brokers in accordance with Ordinance No. 28 of 10.05.2006 of the FSC on the terms and procedure for conducting an examination for the professional qualification of insurance brokers and for the recognition of a qualification acquired in a Member State and for the registration of vocational training materials.

The examination will be held on 27 November 2021.

By 20.10.2021, the interested persons should submit an application for admission to the examination according to an approved template, together with the appendices under Art. 3, para. 2 of Ordinance No. 28 of 10.05.2006, namely: police clearance certificate or other similar document certifying the circumstances under Art. 303, para. 1, item 1 of the IC; a notarized copy of a diploma of higher education obtained in the country, respectively a legalized translation of a diploma of higher education obtained in a higher school outside the Republic of Bulgaria, to certify the circumstances under Art. 303, para. 2 of the IC and a declaration of the circumstances under Art. 303, para. 1, items 2 – 4 of the IC, according to a template.

Applications can be submitted every working day at the FSC office or signed with an electronic signature at the following e-mail address: delovodstvo@fsc.bg. A fee in the amount of BGN 450.00 (four hundred and fifty) shall be paid for taking the exam, based on Section I, item VI, line 15 in connection with Section IV, item IV of the Tariff of Fees Collected by the FSC under the Financial Supervision Commission Act, to the following bank account: IBAN: BG 95 BNBG 9661 3000 1415 01, BIC of BNB -Central office: BNBGBGSD.

The topics covered by the examination are published on the FSC’s website, in the section “Supervised entities”, “Qualification examinations”, “Insurance brokers examinations”, where the list of admitted candidates will be announced, as well as all other announcements related to the conduct on this exam.