Increase in state fees
Change of local jurisdiction
In Decision 723/29.06.2017 the Bulgarian Commission for the Protection of Competition (CPC) adopted an opinion on the draft act for the amendment of the Administrative Procedure Code. Among the proposed amendments in the draft are:
- the introduction of electronic justice (eg, electronic delivery of summons, letters and announcements);
- an increase in state fees for appeal before the court of cassation and the introduction of proportionate fees as a percentage of the material interest; and
- a change of local jurisdiction for the appeal of decisions ruled on competition and public procurements proceedings.
The CPC supports the introduction of electronic justice which, in its view, will increase the efficiency of the judiciary system and prevent unnecessary delays. However, the CPC disagrees with the increase in state fees. It has examined the proposal, according to which the state fees for appeal before a court of cassation would be a percentage of the "material interest, which can be defined" (as opposed to the existing fees which are a fixed amount). The CPC considers such an amendment "legally and logically ungrounded and incorrect" and underlines the fact that the fee – approximately Lev3,400 (€1,740) or Lev9,000 (approximately €4,600) where the 'material interest, which can be defined' is above Lev10 million (approximately €5.11 million) – disregards the lack of a clear definition of 'material interest, which can be defined'.
The CPC also disagrees with the proposal that the state fee for cassation is to be defined as a percentage of the imposed penalty (ie, 1% of the imposed penalty, but no more than Lev8,000, approximately €4,090). In part of its decision the CPC imposes fines and penalties which amount to several million Bulgarian levs. The imposed penalties can reach 10% of the annual turnover of the infringing undertaking. According to the CPC the proposal may be interpreted such that the penalty is the 'material interest', similar to the material interest in the civil and commercial proceedings. This would mean having to define the attorney fees based on this material interest. Thus, if the draft is adopted:
"the CPC would be forced not to perform its legal powers or not to impose pecuniary sanctions and fines or to impose the minimum fines and pecuniary sanctions with the presumption that a potential repeal of its act may lead to payment of substantial attorney fees, which cannot be covered by the CPC's budget."
Further, the CPC opposes the change of the local jurisdiction for the appeal of competition and public procurement proceedings. These proceedings are subject to two-instance proceedings before three and five-member panels of the Supreme Administrative Court (SAC). The draft proposes that the Sofia Administrative Court be first instance of appeal for competition proceedings. However, the CPC contends that the SAC has reasonable and legal competence. It states that within the last year, following the accession of Bulgaria to the European Union, judges from the SAC have been involved in various specialised competition seminars financed by European institutions; this is not the case with the Sofia Administrative Court.
Similarly, the CPC disagrees with changing the local jurisdiction for public procurement proceedings. The Administrative Court of Sofia is proposed to act as second instance instead of the SAC in case the amount of the public procurement is under a certain fixed threshold. However, the CPC considers that the current competences of the SAC for public procurement proceedings are in line with the Constitution and Decision 6/11/11.2008 of the Constitutional Court.
The CPC proposes that the draft be amended as such.
For further information on this topic please contact Galina Petkova at Advokatsko Druzhestvo Andreev Stoyanov & Tsekova in cooperation with Schönherr Rechtsanwälte GmbH by telephone (+359 2 933 1072) or email ([email protected]). The Advokatsko Druzhestvo Andreev Stoyanov & Tsekova website can be accessed at www.schoenherr.eu.