Opinion of the Advocate General — ECLI:EU:C:2020:729
Date: 2020-09-17
Language of the case: Bulgarian
Subject matter: Right of establishment;Approximation of laws;Freedom to provide services
Procedure: Reference for a preliminary ruling
Origin: Bulgaria

Summary C-501/18 — 1 
Case C-501/18 
Summary of the request for a preliminary ruling pursuant to Article 98(1) of 
the Rules of Procedure of the Court of Justice 
Date lodged:  
30 July 2018 
Referring court:  
Administrativen sad Sofia-grad (Bulgaria) 
Date of the decision to refer:  
17 July 2018 
Applicant:  
BT 
Defendant:  
Balgarska narodna banka 
  
Subject matter of the main proceedings 
The proceedings relate to State liability for losses and were brought via the action 
of BT, by means of which two claims are asserted against Balgarska narodna 
banka (Bulgarian Central Bank, hereinafter: BNB) on the grounds of acts of 
commission or omission that infringe EU law, specifically owing to defective 
supervision regarding Korporativna targovska banka (Corporate Commercial 
Bank, hereinafter: KTB), in which the applicant was a depositor.  
Subject matter and legal basis of the reference 
The reference for a preliminary ruling relates to the competence of the national 
courts to regard, of their own motion, Article 4(3) of the Treaty on the European 
Union (hereinafter: TEU) as a legal basis for claims that have been brought; the 
validity and interpretation of a recommendation of the European Banking 
Authority (hereinafter: EBA) as well as the right of depositors in a bank to bring 
an action for damages against a Member State on the ground of defective 
supervision regarding a credit institution. [Or. 2] 
EN 
SUMMARY OF REQUEST FOR A PRELIMINARY RULING — CASE C-501/18 
 
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Questions referred 
1. Does it follow from the principles of EU law of equivalence and 
effectiveness that a national court is obliged to regard, of its own motion, an 
action as having been brought on the ground of a breach of an obligation arising 
from Article 4(3) of the Treaty on the European Union (TEU) by a Member State 
if the action relates to the non-contractual liability of the Member State for losses 
arising from an infringement of EU law that were allegedly caused by an authority 
of a Member State, and  
– Article 4(3) TEU was not expressly specified as a legal basis in the application, 
but it is clear from the grounds for the action that the loss is asserted on the 
ground of an infringement of provisions of EU law;  
– the claim for damages was based on a national provision regarding State 
liability for losses that arise in the performance of administrative activity, and 
that liability is strict and was incurred under the following conditions: 
unlawfulness of a legal act, act or omission of an authority or official in the 
course of or in connection with the performance of administrative activity; 
material or non-material loss incurred; direct and immediate causal link 
between the loss and the unlawful conduct of the authority;  
– under the law of the Member State, the court must determine, of its own 
motion, the legal basis for State liability for the activity of the judicial 
authorities on the basis of the circumstances on which the action is based? 
2. Does it follow from recital 27 in the preamble to Regulation (EU) 
No 1093/201[0] of the European Parliament and of the Council of 24 November 
2010 establishing a European Supervisory Authority (European Banking 
Authority) that, under circumstances such as those of the main proceedings, the 
recommendation issued on the basis of Article 17(3) of the regulation, in which an 
infringement of EU law by the central bank of a Member State in connection with 
the deadlines for paying out guaranteed deposits to the depositors in the respective 
credit institution has been established:  
– confers on the depositors at that credit institution the right to invoke the 
recommendation before a national court in order to substantiate an action for 
damages on the ground of that infringement of EU law, if account is taken of 
the European Banking Authority’s express power to establish infringements of 
EU law, and if it is considered that the depositors are not, and cannot be, the 
addressees of the recommendation and the latter does not establish any direct 
legal consequences for them;  
– is valid, having regard to the requirement that the infringed provision must 
provide for clear and unconditional obligations, if consideration is given to the 
fact that point (i) of Article 1(3) of Directive 94/19/EC on deposit-guarantee 
schemes, if it is interpreted in conjunction with recitals 12 and 13 in the 
preamble to that directive, does not contain all [Or. 3] the elements required to 
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establish a clear and unconditional obligation for the Member States and does 
not confer direct rights on depositors, and taking account of the fact that that 
directive provides for only minimum harmonisation that does not cover the 
indications by means of which unavailable deposits are determined, and that 
the recommendation has not been substantiated by other clear and 
unconditional provisions of EU law in relation to those indications, in 
particular the assessment of the lack of liquidity and the current lack of 
prospects of payout; an existing obligation to order early intervention measures 
and to maintain the business activity of the credit institution;  
– in view of the subject matter, the deposit guarantee, and the power of the 
European Banking Authority to issue recommendations on the deposit 
guarantee scheme pursuant to Article 26(2) of Regulation (EU) No 1093/2010, 
is valid in relation to the national central bank, which has no connection with 
the national deposit guarantee scheme and is not a competent authority 
pursuant to point [iii] of Article 4(2) of that regulation? 
3. Having regard also to the current state of the EU law relevant to the main 
proceedings, does it follow from the judgments of the Court of Justice of the 
European Union of 12 October 2004, Paul and Others (C-222/02, 
EU:C:2004:606, paragraphs 38, 39, 43 and 49 to 51), of 5 March 1996, Brasserie 
du pêcheur and Factortame (C-46/93 and C-48/93, EU:C:1996:79, paragraph 42 
and 51), of 15 June 2000, Dorsch Consult v Council and Commission 
(C-237/98 P, EU:C:2000:321, paragraph 19), and of 2 December 1971, 
Zuckerfabrik Schöppenstedt v Council (5/71, EU:C:1971:116 paragraph 11) that:  
A) the provisions of Directive 94/19, particularly Article 7(6), confer on 
depositors the right to assert claims for compensation against a Member State for 
defective supervision regarding the credit institution that administers their 
deposits, and are those rights restricted to the guaranteed amount of the deposits or 
is the term ‘rights to compensation’ in that provision to be interpreted broadly? 
B) the supervisory measures adopted by the central bank of a Member State to 
reorganise a credit institution, such as those in the main proceedings, including the 
suspension of payments, which are provided for, in particular, in the seventh 
indent of Article 2 of Directive 2001/24/EC, constitute an unjustified and 
unreasonable infringement of the depositors’ right to property that incurs liability 
for losses arising from an infringement of EU law if, having regard to 
Article 116(5) of the Law on credit institutions and Article 4(2)(1) and 
Article 94(1)(4) of the Law on bank insolvency, the law of the respective Member 
State provides that contractual interest is calculated for the duration of the 
measures and the claims that exceed the guaranteed amount of the deposits can be 
satisfied in general insolvency proceedings, and provides that interest can be paid? 
[Or. 4]  
C) the requirements provided for in the national law of a Member State for non-
contractual liability for losses arising from an act or omission in connection with 
SUMMARY OF REQUEST FOR A PRELIMINARY RULING — CASE C-501/18 
 
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the exercise by a Member State’s central bank of the supervisory powers covered 
by the scope of application of Article 65(1)(b) TFEU must not run counter to the 
requirements and principles of that liability that apply under EU law, specifically: 
the principle according to which actions for damages are independent of actions 
for annulment and the established illegality of a requirement under national law 
that a legal act or an omission on the basis of which compensation is sought must 
be annulled beforehand; the illegality of a requirement under national law 
regarding the culpability of authorities or officials for whose conduct 
compensation is sought; the requirement in respect of actions for damages to 
compensate for material harm whereby the plaintiff must have suffered actual and 
certain damage at the time the action was brought?  
D) on the basis of the principle of EU law according to which actions for 
damages are independent of actions for annulment, the requirement that the 
relevant conduct of the authority be unlawful must be met, which is equivalent to 
the requirement under the national law of the Member State according to which 
the legal act or the omission on the basis of which compensation is sought, namely 
the measures to reorganise a credit institution, must be annulled, if consideration 
is given to the circumstances of the main proceedings and it is considered that:  
– these measures are not directed at the applicant, which is a depositor at a credit 
institution, and that it is not entitled under national law and in accordance with 
the national case-law to apply for the annulment of the individual decisions by 
means of which these measures were ordered, and that those decisions have 
become final;  
– EU law, specifically Directive 2001/24 in this area, does not impose an express 
obligation on the Member States to provide for the possibility of challenging 
the supervisory measures for the benefit of all creditors in order to establish the 
validity of the measures;  
– the law of a Member State does not provide for non-contractual liability for 
losses incurred due to lawful conduct on the part of authorities or officials?  
E) In the event of an interpretation to the effect that, under the circumstances of 
the main proceedings, the requirement that the respective conduct of the authority 
be unlawful is not applicable to actions of depositors at a credit institution for 
compensation due to acts and omissions of the central bank of a Member State 
and, in particular, for the payment of interest for guaranteed deposits not having 
been paid out within the deadline and for the payment of deposits exceeding the 
guaranteed amount, which are brought to seek compensation for an infringement 
of Articles 63 to 65 and 120 TFEU, Article 3 TEU and Article 17 of the Charter of 
Fundamental Rights of the European Union [Or. 5], are the requirements 
established by the Court of Justice of the European Union for non-contractual 
liability applicable to losses:  
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– that arose due to lawful conduct on the part of an authority, specifically the 
three cumulative requirements, namely the existence of actual loss, a causal 
link between that loss and the act concerned, and the abnormal and special 
nature of the loss, particularly in the case of actions for the payment of interest 
for guaranteed deposits not being paid out within the deadline, or 
– in the domain of economic policy, particularly the requirement ‘only if there 
has been a sufficiently serious breach of a superior rule of law for the 
protection of individuals’, particularly in actions of depositors for the payment 
of deposits exceeding the guaranteed amount, which are asserted as a loss and 
to which the procedure provided for by national law is applicable, if account is 
taken of the wide discretion enjoyed by the Member States in connection with 
Article 65(1)(b) TFEU and the measures under Directive 2001/24 and if the 
circumstances pertaining to the credit institution and the person seeking 
compensation relate to only one Member State but the same provisions and the 
constitutional principle of equality before the law apply to all depositors? 
4. Does it follow from the interpretation of Article 10(1) in conjunction with 
point (i) of Article 1(3) and Article 7(6) of Directive 94/19 and the legal 
considerations in the judgment of the Court of Justice of the European Union of 
21 December 2016, Vervloet and Others (C-76/15, EU:C:2016:975, paragraphs 82 
to 84), that the scope of application of the provisions of the directive cover 
depositors 
– whose deposits were not repayable on the basis of contracts and statutory 
provisions during the period running from the suspension of payments of the 
credit institution to the withdrawal of its authorisation for banking business, 
and the respective depositor has not expressed that he seeks repayment, 
– who have agreed to a clause that provides for the guaranteed amount of the 
deposits to be paid out in accordance with the procedure governed in the law of 
a Member State, and specifically after the withdrawal of the authorisation of 
the credit institution that manages the deposits, and that requirement has been 
met, and 
– the aforementioned clause of the deposit contract has the force of law between 
the contracting parties under the law of the Member State? 
Does it follow from the provisions of that directive or from other provisions of EU 
law that the national court may not take such a clause in the deposit contract into 
consideration and may not examine the action of a depositor for the payment of 
interest due to failure to pay out the guaranteed amount of deposits within the 
deadline pursuant to that contract on the basis of the requirements for non-
contractual liability for loss [Or. 6] arising from an infringement of EU law and 
on the basis of Article 7(6) of Directive 94/19? 
SUMMARY OF REQUEST FOR A PRELIMINARY RULING — CASE C-501/18 
 
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Legislation and case-law of the European Union 
The referring court cites the TEU, the TFEU, the Charter of Fundamental Rights 
of the European Union, Directive 94/19, Directive 2009/14/EC and Regulation 
No 1093/2010. 
Furthermore, it states that it is aware of Case C-571/61 pending before the Court 
of Justice, in which the action is identical to the first claim asserted in the present 
proceedings. However, it takes the view that further questions should be referred 
for a preliminary ruling.  
National legislation 
Pursuant to Article 1 of the Zakon za otgovornostta na darzhavata i obshtinite za 
vredi (Law on State liability, hereinafter: ZODOV), the State is liable for losses 
incurred by natural persons as a result of unlawful acts or omissions in the 
performance of administrative activity. The procedure provided for in the 
Administrativnoprotsesualen kodeks (Administrative Procedure Code, hereinafter: 
APK) is applicable to these actions. 
Pursuant to Article 79a(1) of the Zakon za kreditnite institutsii (Law on credit 
institutions, hereinafter: ZKI), the BNB is obliged to comply with the 
recommendations of the EBA unless there are legitimate reasons for non-
compliance by it, which must be presented by the BNB. 
Pursuant to Article 204(1) APK, an action for damages can be brought in 
accordance with the appropriate procedure after the administrative act has been 
annulled. 
Pursuant to Article 4 of the Zakon za garantirane na vlogovete v bankite (Law on 
guaranteeing bank deposits), in force until 14 August 2015 (hereinafter: ZGVB), 
the Fond za garantirane na vlogovete v bankite (Fund for guaranteeing bank 
deposits, hereinafter: deposit guarantee fund) guarantees a person’s deposits in a 
bank up to BGN 196 000 irrespective of the number and size of the deposits, 
whereby that amount includes the interest accrued up until the point of the 
decision of the BNB on the withdrawal of the authorisation for banking business. 
Article 23 of that law provides that the appointed supervisory official is obliged to 
provide the governing council of the deposit guarantee fund with information 
regarding the deposits at the bank within three days of the decision on the 
withdrawal of the authorisation. 
Article 36 ZKI provides that the BNB is obliged to withdraw a bank’s 
authorisation on grounds of insolvency if it has not honoured its outstanding 
liabilities for more than seven working days, this is directly linked to the financial 
situation of that bank, and the BNB considers it unlikely that the outstanding 
claims will be settled within a reasonable period or if that bank has negative 
equity capital. The decision regarding the withdrawal of the bank’s authorisation 
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must be made within five working days of establishing the state of insolvency. 
[Or. 7] 
Pursuant to Article 79 of the Zakon na BNB (Law on the BNB), the bodies of the 
BNB and the persons authorised by them are liable for loss incurred in the 
exercise of their supervisory powers only if they acted intentionally. Pursuant to 
Article 115 of that law, the BNB may place a bank for which there is a risk of 
insolvency under special supervision in order to reorganise the bank. In such 
cases, the BNB may reduce the interest rates for deposits at the bank concerned to 
the average market rate and completely or partly suspend fulfilment of the bank’s 
obligations for a certain period of time. 
The referring court states that, according to the case-law of the Varhoven 
administrativen sad (Supreme Administrative Court, hereinafter: VAS), the 
actions of depositors of KTB against the decision of the Governing Council of the 
BNB on the withdrawal of a commercial bank’s authorisation are inadmissible 
owing to the lack of a direct personal grievance. According to the case-law of that 
court, there is also no such grievance in the case of actions against the decision of 
the Governing Council of the BNB on the restriction of the access of depositors to 
their deposits at a bank, as that decision neither establishes a direct and immediate 
obligation on the part of the depositors nor directly restricts their rights. 
Brief summary of the facts and procedure 
1 Three contracts regarding unlimited deposits in euros and leva (BGN) were 
entered into between the applicant and KTB in 2008, 2010 and 2011. 
2 The contracts provide that the applicant’s deposits are guaranteed by the deposit 
guarantee fund up to an amount of BGN 196 000 per person. 
3 Directive 94/19, amended by Directive 2009/14, was transposed by the Law on 
guaranteeing bank deposits, which has been in force since 12 June 2009. The 
referring court points out that point (i) of Article 1(3) of Directive 94/19 was not 
transposed into national law during the period at issue, and was not actually 
transposed until 14 August 2015 when the new law on guaranteeing bank deposits 
entered into force. This law also transposed new Directive 2014/49/EU, which, 
however, is not applicable in the main proceedings. 
4 Since 25 March 2014, BNB has been the competent authority for the supervision 
of banks in the Republic of Bulgaria within the meaning of Article 4(1)(40) of 
Regulation (EU) No 575/2013. 
5 By decision of the Governing Council of the BNB of 20 June 2014, which was 
supplemented on 22 June 2014, KTB was placed under special supervision for 
three months due to the threat of insolvency, supervisory officials were appointed, 
fulfilment of all the bank’s obligations was suspended, and it was prohibited from 
performing all the activities under its authorisation. 
SUMMARY OF REQUEST FOR A PRELIMINARY RULING — CASE C-501/18 
 
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6 By decision of the Governing Council of the BNB of 30 June 2014, the interest 
rates for deposits at KTB were reduced to the average market rate with effect from 
1 July 2014 and a standard rate scale was established, on the basis of which the 
interest rates for the applicant’s deposits were calculated for the period running 
until 6 November 2014. These interest rates are deemed to have been 
contractually agreed. 
7 On 31 July 2014, guidelines for adjusting the value of the bank’s credit claims 
were issued in a decision of the BNB. 
8 On 1 August 2014, the European Commission sent a letter of formal notice to the 
Finance Minister within the context of the procedure under Article 258 TFEU 
owing to incorrect transposition of Directive 94/19 and infringement of Article 63 
TFEU. 
9 By decision of 16 September 2014, the Governing Council of the BNB extended 
the supervisory measures until 20 November 2014. 
10 By press release of 25 September 2014, the European Commission announced that 
it was opening infringement proceedings against Bulgaria for its failure to 
correctly transpose Articles 1(3) and 10(1) of Directive 94/19 as well as its failure 
to comply with the principle of free movement of capital under Article 63 TFEU 
(infringement proceedings No 2014/2240). 
11 In a report of the BNB to the Narodno sabranie (National Assembly, hereinafter: 
NS) of 27 October 2014, it was stated that the European Commission had been 
informed that a final decision on KTB had been reached in the period from 1 to 
20 November 2014 and the depositors with guaranteed deposits would gain access 
to their deposits within a short period of time. The report states that the 
government had objected that the exceptions of Article 65(1)(b) TFEU were 
applicable in relation to the free movement of capital and the preliminary 
suspension of payments was provided for in Article 2 of Directive 2001/24. In the 
report to the National Assembly, it was also explained that, in the subsequent 
communication, the Commission no longer took the view that point (i) of 
Article 1(3) of Directive 94/19 could be directly applied by the national 
authorities. 
12 On 17 October 2014, the EBA issued a recommendation pursuant to Article 17(3) 
of Regulation No 1093/2010, in which it established that the BNB had infringed 
EU law by not doing what was necessary to determine the unavailability of the 
deposits pursuant to point (i) of Article 1(3) of Directive 94/19 and decided to 
suspend fulfilment of all obligations and not to grant the depositors access to the 
guaranteed deposits. 
13 On 6 November 2014, approval to increase the capital of KTB using funds from a 
loan agreement was revoked by decision of the Governing Council of the BNB, as 
KTB had financed the lenders and the funds that were the subject of that 
agreement were made available by the bank itself. 
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14 By decision of the same day, the Governing Council of the BNB withdrew KTB’s 
authorisation for banking business on the ground of insolvency and negative 
equity capital. 
15 On 7 March 2015, the Sofiyski apelativen sad (Sofia Court of Appeal) set 20 June 
2014 as the start of KTB’s insolvency. 
16 Infringement proceedings No 2014/2240 of the European Commission were 
closed on 10 December 2015. 
Essential arguments of the parties in the main proceedings 
1. Applicant’s submissions 
a) The first head of claim 
17 The compensation (BGN 8 627.96) that is the subject of the first head of claim 
covers the statutory interest for the period from 30 June 2014 until 4 December 
2014 for the guaranteed amounts of the applicant’s deposits at KTB that were paid 
out by the deposit guarantee fund after the last-mentioned period. 
18 The applicant takes the view that the payment of the deposits was delayed because 
the BNB had failed to determine the existence of ‘unavailable deposits’ within the 
scope of its statutory competence pursuant to Article 10(1) of Directive 94/19 
within the time-limit pursuant to point (i) of Article 1(3) of that directive. 
19 As grounds for its plea of illegality, the applicant cites the European 
Commission’s letter of formal notice of 1 August 2014, the European 
Commission’s press release of 25 September 2014 and the EBA’s 
recommendation of 17 October 2014. 
20 In view of the time-limits provided for in the directive, the determination should 
have been made on 30 June 2014 and the time-limits for paying out guaranteed 
deposits should have started running from that point. 
b) The second head of claim 
21 The compensation (BGN 44 070.90) that is the subject of the second head of 
claim covers the applicant’s claim that exceeds the amount of the guaranteed 
deposits and that it asserts as a loss that it incurred as a result of the unlawful acts 
and omissions of the BNB. The loss was attributable to the retrospective effect of 
the BNB’s decision of 6 November 2014 regarding the revocation of the approval 
for a capital increase, the guidelines of 31 July 2014 for adjusting the value of the 
credit claims and the decision of 6 November 2014 regarding the withdrawal of 
KTB’s authorisation. 
SUMMARY OF REQUEST FOR A PRELIMINARY RULING — CASE C-501/18 
 
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22 The BNB’s guidelines infringed Article 120 TFUE, Article 3 TEU and Article 24 
of Regulation (EU) No 575/2013. 
23 BNB’s supervisory measures infringed Articles 63 to 65 TFEU, as they are not 
justified and not proportional to the bank’s situation as at 20 June 2014, and they 
did not serve to reorganise the bank, as it only required liquidity assistance. These 
unlawful acts began on 20 June 2014 and continued until 6 November 2014, when 
the banking authorisation was withdrawn. 
24 The causal link between the loss asserted with the second head of claim and the 
acts of the BNB existed on account of the quality of the supervisory measures, 
which resulted in a worsening of KTB’s situation and the subsequent withdrawal 
of its authorisation. The banking supervision was not effective enough to maintain 
the stability of the banking system and protect the interests of the depositors, as 
the supervision was not sufficient to identify the deficiencies of the credit 
institution in good time and take suitable measures for remedying them. 
25 The loss asserted with the second head of claim was based, in the alternative, on 
an unlawful omission that manifested itself in the inefficient banking supervision 
by the BNB, as had been found in the audit report of the Court of Auditors for the 
period from 1 January 2012 to 31 December 2014. 
26 The applicant contests the applicability of the judgment of the Court of Justice of 
12 October 2004, Paul and Others (C-222/02, EU:C:2004:606, hereinafter the 
‘Paul judgment’), since, in contrast to the present case, the credit institution in 
those proceedings did not belong to a deposit guarantee scheme. 
27 The applicant requests that the main proceedings be stayed until a decision is 
reached in the Kantarev case (C-571/16) pending before the Court of Justice, as 
the questions referred in that case are relevant to its first head of claim. 
2. Submissions of the defendant 
28 The defendant argues that both heads of claim are inadmissible and unfounded. 
29 It takes the view that the BNB did not have the capacity to be party to legal 
proceedings, since liability under the ZODOV was strict, while the Law on the 
BNB made provision only for deliberate acts. 
30 It cites the decision of the European Commission of 10 December 2015 regarding 
the closure of infringement proceedings No 2014/2240 in relation to infringement 
of Article 1(3) and Article 10(1) of Directive 94/14/EC. It believes that Directive 
94/14 had been correctly transposed into Bulgarian law; in addition, the legislature 
was responsible for incorrect transposition. 
31 Regarding the first head of claim, the requirements established in paragraph 40 of 
the judgment of the Court of Justice of 19 November 1991, Francovich (C-6/90 
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and C-9/90, EU:C:1991:428) had not been met. Point (i) of Article 1(3) of 
Directive 94/19 was not an unconditional provision and therefore not a suitable 
cause of action in a claim for damages. The BNB was subjected to the obligation 
to determine the unavailability of deposits only by point (17) of Article 2(1) of 
Directive 2014/49, while, pursuant to recital 12 in the preamble to Directive 
94/19, only minimum harmonisation was required, meaning that the national 
legislature had a certain margin of discretion, and it provided that the 
determination of unavailable deposits would be determined in the same act with 
which the authorisation for banking business was withdrawn. 
32 The applicant deposits had become neither due nor payable. There was no loss, as 
interest had been calculated for the period of the special supervision. The 
guaranteed deposits would cover the principle amount and the interest calculated 
up to 6 November 2014, and paying interest twice — once as contractual interest 
and then again as compensation in the form of default interest at the statutory 
rate — was not permitted. Another reason why there was no loss was that the 
deposit guarantee fund paid out the guaranteed amount of the deposits and the 
applicant agreed to the payment in writing. 
33 In relation to the second head of claim, State liability was ruled out as the claim 
could be settled in the context of the insolvency proceedings regarding [the assets 
of] the bank. There was therefore no loss, as the claim asserted with this head of 
claim was included ex officio in the list of creditors in the context of those 
proceedings. The aim of asserting this amount as a loss was to circumvent the 
regulated procedure for repaying creditors. 
Succinct presentation of the reasoning in the reference for a preliminary 
ruling 
34 The referring court breaks its doubts down into several points. 
1. The applicability of EU law in the main proceedings 
35 According to the referring court, the subject of the proceedings is the non-
contractual liability of a Member State for loss incurred due to an infringement of 
EU law. On the other hand, both claims asserted are based only on principles that 
are provided for in national law. For the referring court, the question arises as to 
whether it must examine the claims pursuant to Article 4(3) TEU by its own 
motion and take the resulting consequences into account. 
36 It believes that it is necessary to assess whether, in consideration of the judgment 
of 15 November 2016, Ullens de Schooten (C-268/15, EU:C:2016:874, 
paragraphs 44, 47, 52, 57, 58 and the operative part of the judgment), a purely 
national case is involved as regards the infringement of Articles 63 to 65 TFEU 
asserted with the second head of claim. It is disputable whether the Paul and 
Others judgment is applicable in the present case. 
SUMMARY OF REQUEST FOR A PRELIMINARY RULING — CASE C-501/18 
 
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2. The applicant’s entitlement to invoke before a court the recommendation 
of the EBA and the communication of the European Commission in relation 
to the infringement of EU law committed 
37 The applicant invokes the recommendation of the EBA in relation to the first head 
of claim and the communication of the European Commission in relation to the 
second head of claim. 
a) The recommendation 
38 The referring court states that, pursuant to point (iii) of Article 4(2) of Regulation 
No 1093/2010, with regard to deposit guarantee schemes, ‘competent authorities’ 
are bodies which administer or supervise deposit guarantee schemes. It finds that 
the BNB neither administers nor supervises the scheme and therefore believes that 
interpretation from the Court of Justice is required in relation to the question of 
whether the EBA was authorised to address a recommendation to the BNB and 
whether that recommendation is valid. 
39 It is questionable whether point (i) of Article 1(3) of Directive 94/19 provides for 
clear and unconditional obligations and whether the specific recommendation of 
the EBA is therefore compatible with recital 27 in the preamble to Regulation 
No 1093/2010. 
40 Directive 94/19 does not make provision for a specific competent authority that 
must make the determination of unavailable deposits, and the EBA based its 
recommendation solely on the principle established in the judgment of the Court 
of Justice of 18 December 1997, Inter-Environnement Wallonie (C-129/96, 
EU:C:1997:628) in conjunction with new Directive 2014/59, according to which 
the BNB is the competent authority. 
41 The EBA takes the view that the deposits were ‘unavailable’, as it assumed that 
the requirements of point (i) of Article 1(3) of Directive 94/19 were met. The 
referring court deems the EBA’s conclusions to be unfounded, as the 
aforementioned regulation does not clearly govern how the term ‘reasons which 
are directly related to its financial circumstances’ is to be understood. Regarding 
the term ‘for the time being’, the referring court takes the view that the need for 
extraordinary public financial support within the meaning of recital 31 in the 
preamble to Directive 2014/59 does not mean in itself that the credit institution is 
not capable of fulfilling its obligations. The referring court also cites 
communications of the European Commission that show the approval and 
imminent granting of support for the KTB Group. As the EBA cited recital 12 in 
the preamble to Directive 2009/14 and the unsuccessful early intervention 
measures in connection with the term ‘for the time being’, the referring court finds 
that such measures were not provided for in the decision regarding the order to 
place KTB under special supervision and are not governed by national law either. 
The referring court points out that early intervention measures are provided for in 
Directive 2014/59, but that directive is not applicable in the present proceedings. 
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42 The supervisory measures ordered by the BNB correspond to those pursuant to 
Article 104(1)(e) of Directive 201[3]/36 and the seventh indent of Article 2 of 
Directive 2001/24, meaning that the suspension of payments ordered by decision 
of 20 June 2014 was compatible with EU law. 
43 The referring court takes the view that the EBA essentially obliges the Bulgarian 
State to maintain the business activity of KTB in contradiction to recital 59 in the 
preamble to Regulation (EU) No 806/2014. As the decisions of the Governing 
Council of the BNB of 20 and 22 June 2014 are not expressly based on [the 
requirement of] ‘for the time being’, it is unclear to the referring court why the 
EBA assumes that unsuccessful early intervention measures exist and — if, on the 
other hand, no resolution measures were ordered, only the suspension of 
payments — why the business activity of KTB should be maintained having 
regard to recital 46 in the preamble to Directive 2014/59. 
44 With regard to the above statements, the referring court points out, in relation to 
the first claim, that the EBA’s conclusion that the BNB had already made the 
deposits ‘unavailable’ by 20 and 22 June 2014 requires interpretation with regard 
to its compatibility with recital 27 in the preamble to Regulation No 1093/2010. 
45 It would like to know whether, having regard to paragraphs 12, 16 and 18 of the 
judgment of the Court of Justice of 13 December 1989, Grimaldi (C-322/88, 
EU:C:1989:646), it should take the EBA’s recommendation into consideration. In 
particular, the referring court would like to know whether that recommendation 
establishes rights for individuals and unavoidable legal consequences for the 
depositors in KTB. It takes the view that the EBA’s recommendation does not 
have direct effects on the latter. 
b) The communication of the European Commission 
46 In the communication, the European Commission assumes that it would have been 
possible for the BNB to order less drastic measures. The referring court takes the 
view that this finding essentially means that there is an infringement of Article 52 
of the Charter in connection with the depositors’ right to property in relation to 
their claims against the credit institution. 
47 On the other hand, the measures at issue, which were ordered by means of the 
decisions of the Governing Council of the BNB of 20 and 22 June 2014, are 
provided for in the seventh indent of Article 2 of Directive 2001/24 and constitute 
a permitted restriction of the depositors’ right to property. The referring court 
finds the communication of the European Commission to be unclear, as it does not 
explain which other measures could have been ordered. 
48 The European Commission takes the view that ‘the relevant provisions of the 
directive’ on deposit guarantee schemes confer on individuals rights that can be 
enforced before a national court. However, the referring court takes the view that 
SUMMARY OF REQUEST FOR A PRELIMINARY RULING — CASE C-501/18 
 
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it is questionable whether the applicant can invoke point (i) of Article 1(3) of 
Directive 94/19 and Articles 63 to 65 TFEU directly. 
49 There is reason to believe that, having regard to paragraphs 44, 47, 52, 57 and 58 
and the operative part of the Ullens de Schooten judgment, the case concerns a 
purely national situation, but it is questionable whether, having regard to the 
exception referred to in paragraph 52 of that judgment, that case-law is applicable 
in the present proceedings. 
50 It states that the loss asserted with the first claim relates to deposits that had not 
fallen due in the period at issue either pursuant to the contractual provisions or by 
law. Rather, the national deposit guarantee scheme was in difficulty, but the 
repayable deposits were paid out to the applicant nevertheless. The referring court 
asks whether the scope of application of Directive 94/19/EC is not extended by 
this. Under these circumstances, and having regard to paragraphs 82 to 84 of the 
Vervloet and Others judgment, it is not convinced that the applicant’s legal 
situation actually falls within the scope of application of this directive. 
51 It is stated in the European Commission’s communication that the depositors can 
bring before the national courts an action for the payment of unavailable deposits 
pursuant to Article 10(1) of Directive 94/19. However, the referring court takes 
the view that the content of Article 7(6) of that directive is unclear in relation to 
the term ‘rights to compensation’ and has doubts as to whether the first claim can 
be regarded as such a right to compensation. It refers to recital 23 in the preamble 
to that directive, according to which this Directive may not result in the Member 
States’ or their competent authorities’ being made liable in respect of depositors if 
they ‘[ensure] the compensation or protection of depositors’. If the claim asserted 
by the applicant falls under Article 7(6) of the directive, the referring court will 
inform it ex officio that it should bring its action against the national deposit 
guarantee scheme. 
52 The referring court takes the view that it is possible that EU law does not even 
apply to the first claim, since, having regard to the judgment of the Court of 
Justice of 19 January 1982, Becker (8/81, EU:C:1982:7), point (i) of Article 1(3) 
of Directive 94/19 does not confer rights on individuals and does not impose on 
the national authorities any of the obligations, which arise from that provision, to 
adopt appropriate implementation measures. 
53 Moreover, the referring court finds that an interpretation according to which, 
pursuant to the exception in Article 1(2) of Directive 93/13, the terms of the 
second and third deposit contracts establish contractual liability for the payment of 
guaranteed deposits, which rules out non-contractual liability on that part of the 
Member State, is possible. The reason for this is that, under national law, contracts 
act as laws between the parties, and it is laid down in the second and third 
contracts that, pursuant to the ZGVB, the guaranteed amount of the deposits shall 
be paid out within a certain period of time following withdrawal of the 
authorisation for banking business. 
BALGARSKA NARODNA BANKA 
 
15 
3. The principles and requirements of non-contractual liability on the 
part of the Bulgarian State for losses arising from an infringement of EU law 
54 According to the assessment in the Paul and Others judgment, the question arises 
for the referring court as to whether the BNB’s liability for losses can be excluded 
if the provisions of Directive 94/19 do not confer any rights on the depositors vis-
à-vis the competent national supervisory authority for credit institutions. 
Furthermore, the deposits of KTB’s depositors, including the applicant, were paid 
back on 4 December 2014. 
55 Moreover, it is not clear to the referring court whether the liability for 
compensation towards the depositors is limited only to the fulfilment of the 
obligation to pay back the guaranteed deposits or whether, pursuant to Article 7(6) 
of Directive 94/19, the right to compensation should also cover all established 
losses that are based on the late repayment of the deposits. 
56 The question arises as to how paragraph 43 of the Paul and Others judgment 
interacts with paragraph 42 of the judgment of the Court of Justice of 5 March 
1996, Brasserie du pêcheur and Factortame (C-46/93 and C-48/93, 
EU:C:1996:79) and whether the statements in paragraph 43 of the Paul and 
Others judgment can constitute ‘particular justification’ within the meaning of 
paragraph 42 of the Brasserie du pêcheur and Factortame judgment. 
57 The referring court also has doubts as to whether the Brasserie du pêcheur and 
Factortame judgment is still current in view of the provisions regarding the 
liability of the national resolution authority towards the depositors pursuant to 
Regulation No 806/2014 and Directive 2014/59, which, although not applicable in 
the present case, give rise to liability on the part of the defendant pursuant to 
paragraph 42 of the Brasserie du pêcheur and Factortame judgment. 
58 It is also doubtful whether the national law, which makes provision for liability on 
the part of the competent supervisory authority for losses only if there was intent, 
is compatible with paragraph 79 of the Brasserie du pêcheur and Factortame 
judgment. 
59 In the absence of Community harmonisation, the national legislature has a wide 
margin of discretion, as Directive 94/19 undertakes only minimum harmonisation 
in relation to deposits. The BNB also has a certain margin of discretion with 
regard to the supervision of KTB. In consideration of paragraph 29 of the 
judgment of 12 May 2011, Enel Maritsa Iztok 3 (C-107/10, EU:C:2011:298), it is 
in any event possible to require that the requirements of liability on the part of the 
Bulgarian State in respect of losses arising from an infringement of EU law are 
met. 
60 In view of the wide margin of discretion of the State and the BNB in relation to 
guaranteeing deposits, protecting depositors and supervising credit institutions, the 
referring court has difficulty in determining exactly which principles and 
requirements are applicable to this liability under EU law. 
SUMMARY OF REQUEST FOR A PRELIMINARY RULING — CASE C-501/18 
 
16  
61 It cites the Francovich and Brasserie du pêcheur and Factortame judgments and 
refers to the requirement of a sufficiently serious breach of a rule of law 
conferring rights on individuals. In relation to the asserted infringement of 
Article 120 TFEU by the two decisions of the Governing Council of the BNB of 
20 November 2014, it relies on the judgment of the Court of Justice of 
2 December 1971, Aktien-Zuckerfabrik Schöppenstedt (5/71, EU:C:1971:116) and 
states that the liability of a Member State can only be incurred by a sufficiently 
serious breach of a superior rule of law for the protection of individuals. There has 
been such a breach in the case of Article 17(1) of the Charter. On the other hand, 
neither the decisions of the BNB nor the relevant acts of EU law are based on a 
legal basis that governs economic policy pursuant to the Treaties. Owing to the 
wide margin of discretion of the national legislature in relation to the rules to be 
adopted, and owing to the independence of the national supervisory authorities in 
the banking sector, however, it is questionable whether paragraph 11 of the 
Aktien-Zuckerfabrik Schöppenstedt judgment is actually still applicable in the 
present case. 
62 However, the authority concerned has not manifestly and gravely disregarded the 
limits on the exercise of its powers (paragraph 45 of the Brasserie du pêcheur and 
Factortame judgment), as neither the incompatibility of Article 23 (repealed) 
ZGVB in conjunction with Article 36(2) ZKI with Directive 94/19/EC nor BNB’s 
failure to determine the unavailability of the deposits leads to a lack of 
compatibility with a specific provision of that directive, and the supervisory 
measures ordered against KTB do not infringe provisions of EU law either, and 
the acts of the BNB vis-à-vis KTB were also not declared to be unlawful. The 
European Commission took a different view in its observations, however. 
63 The referring court refers to the fact that the depositors are unable to challenge the 
acts of the Governing Council of the BNB that are directed at a credit institution 
and that, in its view, the judgment of the Court of Justice of 15 July 1963, 
Plaumann (25/62, EU:C:1963:17) is not applicable, contrary to the arguments of 
the defendant. It is stated in that judgment that ‘An administrative measure which 
has not been annulled cannot of itself constitute a wrongful act on the part of the 
administration inflicting damage upon those whom it affects’. However, it takes 
the view that it is questionable to what extent the applicant, in the same way as 
KTB, can be regarded as the addressee of the decisions of the Governing Council 
of the BNB, in relation to which it seeks compensation. 
64 However, it is questionable whether the requirement that an act be unlawful must 
be met, since, under national law and pursuant to national case-law, the depositors 
had no right to contest the acts of the national central bank or to request that that 
bank issue an act that is favourable to it. 
65 The referring court points out that it has not been established in these proceedings 
that a national court or the Court of Justice of the European Union found that the 
BNB infringed EU law in the KTB case, meaning that, in relation to both heads of 
claim, the requirement that the claimed act be unlawful has not been formally met. 
BALGARSKA NARODNA BANKA 
 
17 
It is therefore questionable whether the three cumulative conditions referred to in 
paragraph 19 of the Dorsch Consult v Council and Commission judgment have 
been fulfilled. 
66 According to the referring court, non-contractual liability on the part of the Union 
can also be incurred if, in a legislative measure that leads to restrictions of the 
right to property and results in a disproportionate and intolerable impairment, no 
provision has been made for compensation (judgment of the Court of Justice of 
9 September 2008, FIAMM and Others v Council and Commission, C-120/06 P 
and C-121/06 P, EU:C:2008:476, paragraphs 181 and 184). However, it is not 
certain that this principle also applies in the area of fiscal policy. In the present 
proceedings, however, it could be assumed that there was provision for such 
compensation in the form of contractual interest calculated for the period of the 
supervisory measures. 
67 In relation to the second head of claim, the referring court argues that it can be 
assumed that the applicant was not disproportionately impaired in comparison 
with the other creditors of KTB, as its application relates to a claim that exceeds 
the amount of the guaranteed deposits. 
68 In addition, it believes that the damage incurred by the applicant is not actual and 
certain within the meaning of the judgment of the Court of Justice of 16 July 
2009, SELEX Sistemi Integrati v Commission (C-481/07 P, EU:C:2009:461, 
paragraph 36), as the insolvency proceedings were not closed owing to a lack of 
assets at the time when the action was brought. If there did have to be actual and 
certain damage at the time when the action was brought, which is not the case 
here, there would be no need to assess the substance of the other legal bases 
asserted. 
69 There is reason to believe that the second head of claim is inadmissible, as a 
different procedure — namely insolvency proceedings — is provided for the 
satisfaction of the claim asserted with that head of claim.