RESTRICTED
WORLD TRADE S/FIN/W/12/Add.37
28November 1997
ORGANIZATION(97-5281)
Original: English Committee onTrade inFinancial Services
COMMUNICATION FROM BULGARIA
Initial Offer onFinancial Services
Addendum
Thefollowing communication iscirculated attherequest ofBulgaria toMembers ofthe
Committee onTrade inFinancial Services.
_______________S/FIN/W/12/Add.37
Page2BULGARIA
SPECIFIC COMMITMENTS -INITIAL OFFER OFFINANCIAL SERVICES
Modes ofsupply: 1) Cross-border supply 2) Consumption abroad 3) Commercial presence 4) Presence ofnatural persons
Sector orSub-sector Limitations onMarket Access Limitations onNational Treatment Additional
Commitments
7.FINANCIAL SERVICES
Measures Applicable toAllSectors andSubsectors inFinancial Services
1.Bulgaria undertakes commitments onFinancial Services inaccordance withtheprovisions ofthe“Understanding onCommitments inFinancial
Services ”.
2.These commitments aresubject tothelimitations onthemarket access (MA) andnational treatment (NT) inthe“allsectors ”section ofthisschedule and
tothose relating tothesubsectors listed below.
3.TheMAcommitments inrespect ofmodes (1)and(2)apply onlytothetransactions indicated inparagraph B.3andB.4oftheMAsection ofthe
Understanding respectively.
4.Theadmission tothemarket ofnewfinancial services orproducts maybesubject totheexistence of,andconsistency with, aregulatory framework
aimed atachieving theobjectives indicated inArticle 2(a)oftheFinancial Services Annex.
5.Insurance orbanking activities, aswellassecurities trading andactivities related thereto, aretobecarried outseparately bycompanies thatarelicensed
forthesupply ofsuch services.
6.Asageneral ruleandinanon-discriminatory manner, financial institutions thatincorporate intheRepublic ofBulgaria must adopt thelegal form of
joint-stock companies.
7.Thespecific commitments onfinancial services aresubject tothegeneral limitations contained inthehorizontal section oftheSchedule ofSpecific
Commitments onTrade inServices oftheRepublic ofBulgaria (WT/ACC/BGR/5/Add.2).S/FIN/W/12/Add.37
Page3Modes ofsupply: 1) Cross-border supply 2) Consumption abroad 3) Commercial presence 4) Presence ofnatural persons
Sector orSub-sector Limitations onMarket Access Limitations onNational Treatment Additional
Commitments
A. Insurance and
Insurance-Related Services
a)Lifeinsurance services
andpension fund
services
b)Non-life insurance
services (except
deposit insurance and
similar compensation
schemes, aswellas
mandatory insurance
schemes1)(1) Unbound, except forservices supplied by
foreign suppliers toforeign persons inthe
territory oftheRepublic ofBulgaria.
(2) Bulgarian natural andjuridical persons, as
wellasforeign persons whoconduct
business activity intheterritory ofthe
Republic ofBulgaria, conclude insurance
contracts onlywithsuppliers withrespect
totheir activity inBulgaria, which are
licensed toconduct insurance activity in
Bulgaria. Insurance compensation
resulting from these contracts shall be
paidinBulgaria.(1) Unbound
(2) None
1Exclusive service suppliers maybeestablished orauthorized withrespect tomandatory insurance schemes.S/FIN/W/12/Add.37
Page4Modes ofsupply: 1) Cross-border supply 2) Consumption abroad 3) Commercial presence 4) Presence ofnatural persons
Sector orSub-sector Limitations onMarket Access Limitations onNational Treatment Additional
Commitments
(3) Theinsurance service suppliers cannot be
setupforthesupply ofbothlife
insurance andnon-life insurance services.
Foreign persons cansupply insurance
services onlythrough participation in
Bulgarian insurance companies withno
limitation onequity participation, aswell
asdirectly, through abranch, with
registered office intheRepublic of
Bulgaria, after 31March 1998. The
establishment ofbranches offoreign
insurance companies issubject to
licensing bytheNational Insurance
Council. Forestablishing abranch in
Bulgaria toprovide certain classes of
insurance, aforeign insurer must have
been authorized tooperate inthesame
classes ofinsurance initscountry of
origin foratleast fiveyears. The
branches offoreign insurance companies
should satisfy anumber ofspecific
prudential requirements forspecific
guarantee anddeposit requirements, a
separate capitalization, andthe
localization inRepublic ofBulgaria ofthe
assets representing thetechnical reserves.(3) Insurance funds raised byvirtue of
insurance contracts, aswellasown
capital, must beinvested intheRepublic
ofBulgaria andmaybetransferred abroad
onlysubject toapermission ofthe
Ministry ofFinance.
Foreign suppliers cannot conclude
insurance contracts withlocal natural and
juridical persons through brokers.S/FIN/W/12/Add.37
Page5Modes ofsupply: 1) Cross-border supply 2) Consumption abroad 3) Commercial presence 4) Presence ofnatural persons
Sector orSub-sector Limitations onMarket Access Limitations onNational Treatment Additional
Commitments
Fora3-year period after thedateof
accession totheWTO companies in
which foreign participation ensures
majority inadopting decisions orblocks
theadoption ofdecisions, directly or
through other companies, cannot supply
insurance services.
Transport insurance, covering goods,
insurance ofvehicles assuch andliability
insurance regarding risks located inthe
Republic ofBulgaria maynotbe
underwritten byinsurance companies
directly. Aforeign insurance company
mayconclude insurance contracts only
through abranch.
(4) Unbound, except asindicated inthe
Measures Applicable toAllSectors and
Subsectors inFinancial Services.(4) Unbound, except asintheMeasures
Applicable toAllSectors andSubsectors
inFinancial Services.S/FIN/W/12/Add.37
Page6Modes ofsupply: 1) Cross-border supply 2) Consumption abroad 3) Commercial presence 4) Presence ofnatural persons
Sector orSub-sector Limitations onMarket Access Limitations onNational Treatment Additional
Commitments
c) Reinsurance and
retrocession
Lifeandnon-life
reinsurance services(1) None
(2) Unbound
(3) Thereinsurance service suppliers cannot
besetupforthesupply ofbothlifeand
non-life reinsurance services.
Foreign persons cansupply insurance
services onlythrough participation in
Bulgarian insurance companies withno
limitation onequity participation. Foreign
reinsurance companies maysupply
directly reinsurance services through a
branch, withregistered office inthe
Republic ofBulgaria, after 31March
1998. Theestablishment ofbranches of
foreign insurance companies issubject to
licensing bytheNational Insurance
Council.(1) None
(2) Unbound
(3) Reinsurance funds raised byvirtue of
reinsurance contracts, aswellasown
capital, must beinvested intheRepublic
ofBulgaria andmaybetransferred abroad
onlysubject topermission oftheMinistry
ofFinance.
Foreign suppliers cannot conclude
reinsurance contracts withlocal natural
andjuridical persons through brokers.
Fora3-year period after thedateof
accession totheWTO companies in
which foreign participation ensures
majority inadopting decisions orblocks
theadoption ofdecisions, directly or
through other companies, cannot supply
reinsurance services.
(4) Unbound, except asindicated inthe
Measures Applicable toAllSectors and
Subsectors inFinancial Services.(4) Unbound, except asindicated inthe
Measures Applicable toAllSectors and
Subsectors inFinancial Services.S/FIN/W/12/Add.37
Page7Modes ofsupply: 1) Cross-border supply 2) Consumption abroad 3) Commercial presence 4) Presence ofnatural persons
Sector orSub-sector Limitations onMarket Access Limitations onNational Treatment Additional
Commitments
d) Insurance Intermediation
e) Services auxiliary to
insurance, such as
consultancy, actuarial, risk
assessment andclaim
settlement services(1) Unbound
(2) Unbound
(3) Only trade companies, registered inthe
Republic ofBulgaria under theTrade
Law, andlicensed bytheNational
Insurance Council mayconduct
intermediation activity.
Services auxiliary toinsurance have to
relate toinsurance.
Unbound fortheactuarial services.
(4) Unbound(1) Unbound
(2) Unbound
(3) None
(4) UnboundS/FIN/W/12/Add.37
Page8Modes ofsupply: 1) Cross-border supply 2) Consumption abroad 3) Commercial presence 4) Presence ofnatural persons
Sector orSub-sector Limitations onMarket Access Limitations onNational Treatment Additional
Commitments
B. Banking andOther
Financial Services
(Excluding Insurance)
Banking services aslisted
below:
Acceptance ofdeposits and
other repayable funds from
thepublic
Lending, such asconsumer
credit, mortgage credit,
factoring andfinancing of
commercial transactions
Payment andmoney
transmission services
Guarantees, excluding
guarantees oftheState
Treasury
Financial leasing(1) Unbound
(2) Unbound
(3) Foreign banks thataretoestablish inthe
Republic ofBulgaria must beduly
authorized under their national lawand
must notbeprohibited from performing
banking activities intheir country of
origin andinthecountries where they
operate. Unbound forcaisses populaires.
Acquisition, directly orindirectly, of
shares representing 5percentorhigher
ofthevoting rights ofanestablished bank
issubject toanauthorization bythe
Bulgarian National Bank.
Criteria forauthorization areprudential
andareconsistent withtheobligations of
Articles XVIandXVII oftheGATS.(1) Unbound
(2) Unbound
(3) None, except forthose intheMarket
Access column.S/FIN/W/12/Add.37
Page9Modes ofsupply: 1) Cross-border supply 2) Consumption abroad 3) Commercial presence 4) Presence ofnatural persons
Sector orSub-sector Limitations onMarket Access Limitations onNational Treatment Additional
Commitments
Thedirect orindirect acquisition of
participation innon-financial enterprise by
abank ofmore than10percentofthe
capital ofthisenterprise issubject tothe
approval oftheBulgarian National Bank.
Exclusive service suppliers status maybe
granted astodeposit andmoney
transmission services provided to
budgetarily financed public institutions.
Condition forpermanent residence with
respect toexecutive directors ofthe
managing body whoactonbehalf andfor
theaccount ofabank.
(4) Unbound, except asintheMeasures
Applicable toAllSectors andSubsectors
inFinancial Services andin(3)above.(4) Unbound, except asindicated inthe
Measures Applicable toAllSectors and
Subsectors inFinancial Services.
Other financial services
aslisted below:
Participation inissuance of
securities, including
underwriting ofsecurities,
excluding treasury bonds
Trading forownand
customers account of
transferable securities
Asset management
(excluding pension fund
management)(1)Unbound
(2)Unbound
(3) Bound forinvestment intermediaries,
investment companies andstock
exchanges established asjoint stock
companies licensed bytheSecurities and
Stock Exchange Commission (SSEC). The
grant oftherelevant licence isrelated to
themanagement andtechnical
requirements aswellasrequirements
related totheprotection ofinvestors.(1) Unbound
(2) Unbound
(3) None, except forthose intheMarket
Access column.S/FIN/W/12/Add.37
Page10Modes ofsupply: 1) Cross-border supply 2) Consumption abroad 3) Commercial presence 4) Presence ofnatural persons
Sector orSub-sector Limitations onMarket Access Limitations onNational Treatment Additional
Commitments
Stock exchange JSC:
Conditions ofminimum capital (BGL 100
mln.); notlessthan2/3ofthecapital
distributed among financial institutions
(insurance companies, financial houses,
investment intermediaries); a5percent
ceiling ofthecapital oftheStock
Exchange fordirect orindirect
participation byashareholder.
Investment intermediaries:
Bound forinvestment intermediary
activities effected ontheterritory ofthe
Republic ofBulgaria, unless otherwise
permitted bySSEC.
Condition formembership atthestock
exchange fortrading withsecurities ata
stock exchange. Themembership ofan
investment intermediary islimited toone
stock exchange onlyinBulgaria.
Investment companies:
Theactivities ofabank, insurance
company orofaninvestment intermediary
arenottobeconducted byaninvestment
company.
(4) Unbound, except asindicated inthe
Measures Applicable toAllSectors and
Subsectors inFinancial Services andin
(3)above.(4) Unbound, except asintheMeasures
Applicable toAllSectors andSubsectors
inFinancial Services.S/FIN/W/12/Add.37
Page11Modes ofsupply: 1) Cross-border supply 2) Consumption abroad 3) Commercial presence 4) Presence ofnatural persons
Sector orSub-sector Limitations onMarket Access Limitations onNational Treatment Additional
Commitments
Provision andtransfer of
financial information and
financial anddata
processing andrelated
software bysuppliers of
other financial services
Financial consultancy
services(1) None, except forthelimitations and
conditions relating totheuseof
telecommunications network listed inthe
respective sector oftheSchedule of
Specific Commitments onTrade in
Services oftheRepublic ofBulgaria
(WT/ACC/BGR/5/Add.2).
(2) None, except asspecified in(1)above.
(3) None, except asspecified in(1)above.
(4) Unbound, except asintheMeasures
Applicable toAllSectors andSubsectors
inFinancial Services.(1) None
(2) None
(3) None
(4) Unbound, except asindicated inthe
Measures Applicable toAllSectors and
Subsectors inFinancial Services.