EN 
 
 
OPINION OF THE EUROPEAN CENTRAL BANK 
of 12 December 2007 
at the request of Българска  народна  банка  (Bulgarian National Bank) 
on a draft law introducing a licensing regime for entities providing money remittance services 
(CON/2007/40) 
 
Introduction and legal basis  
On 25 October 2007 the European Central Bank (ECB) received a request from the Governor of 
Българска  народна  банка  (Bulgarian National Bank) (BNB) for an opinion on a draft law amending the 
Law on funds transfers, electronic payment instruments and payment systems (hereinafter the ‘draft law’). 
The ECB’s competence to deliver an  opinion is based on Article 105(4) of the Treaty establishing the 
European Community and the third indent of Article 2(1) of Council Decision 98/415/EC of 29 June 1998 
on the consultation of the European Central Bank by  national authorities regarding draft legislative 
provisions1, as the draft law relates to the BNB. In accordance with the fi rst sentence of Article 17.5 of 
the Rules of Procedure of the European Central Ba nk, the Governing Council has adopted this opinion. 
 1.
  Purpose of the draft law 
The aim of the draft law is to introduce a licensing regime for entities providing money remittance 
services and thus to implement the requireme nts of Article 36 of Directive 2005/60/EC of 
26 October 2005 on the prevention of the use of the financial system for the purpose of money laundering 
and terrorist financing2 (hereinafter the ‘Directive’). In particular, the draft law specifies: (i) the categories 
of money remittance companies and the requirements for operating such a business; (ii) the conditions 
under which a licence is granted, revoked or disconti nued; and (iii) the supervisory activities of the BNB 
to ensure that money remittance companies operate th eir business in conformity with this draft law, 
including the BNB’s right to carry out on-site inspections and to obtain information. 
 
                                                 
1  OJ L 189, 3.7.1998, p. 42. 
2  OJ L 309, 25.11.2005, p. 15.  
2 2. General observations  
2.1 The ECB reiterates its commitment to contribut ing to the adoption, implementation and execution 
of measures preventing the use of the financial sy stem for terrorist activities, as expressed in its 
public statement of 1 October 20013.  
2.2 The ECB welcomes the draft law, which will increase transparency with regard to money 
remittance companies. The draft law also provi des for measures that will enhance the BNB’s 
supervisory powers over such entities thus allowing it to play a more active role in the prevention 
of money laundering. It is important to bring the dr aft law into line with the Directive so as to also 
ensure that money remittance companies do no t facilitate terrorist activities in any way. 
2.3 The ECB recommends adding certain provisions to the draft law’s requirements for granting 
licences to money remittance companies, which will br ing it into line with the Directive. Under the 
draft law, one condition for granting a licence is that  ‘the internal control systems, administrative 
and accounting procedures, risk management syst ems, and internal rules on measures against 
money laundering are adequate and proportionate to the nature and size of the business the 
applicant will operate’4. This requirement should also include the internal rules on measures against 
terrorist financing. In particular, Article 26e(1) ite m 4 of the draft law should be reformulated so as 
to ensure that the internal rules that are to be approved by the Director of the Financial Intelligence 
Agency must also comply with the requirement s of the Law on the Measures against Terrorism 
Financing5.  
2.4 The ECB welcomes the introduction of a licensing system under which the reliability and financial 
soundness of partners and shareholders who are owners of the money remittance companies is 
assessed6. In this respect, the Directive requires that if the competent authorities are not satisfied 
that ‘the persons who effectively direct or will direct the business of such entities or the beneficial 
owners of such entities’ they must refu se to license or register such entities7. In the light of the 
above, and in view of the crucial importance of preventing money laundering and terrorist 
financing, it is essential to introduce more specific  and detailed provisions in the draft law relating 
to the identification and verification of all beneficial owners.  
2.5 In addition, it is important to examine in th e licensing procedure that the persons who effectively 
direct an applicant’s business, as well as those persons who are authorised to manage and represent the applicant
8, are fit and proper persons, and the dr aft law should be amended accordingly.  
 
                                                 
3  See the Public statement of  the European Central Bank on its support for m easures to prevent the use of the financial 
system in the funding of te rrorist activities,  available on the ECB’s website at 
www.ecb.europa.eu/press/pr/date/2001/html/pr011001.en.html . 
4  See Article 26b(1) item 6 of the draft law. 
5  Закон  за мерките  срещу  финансирането  на тероризма , published in Darjaven Vestnik issue No 16, 18.02.2003, as 
last amended on 21.07.2006. 
6  See Article 26b(1) item 7 of the draft law. 
7  See Article 36(2) of the Directive. 
8  See Article 26b(1) item 8 of the draft law. 
3 3. Provisions on granting a licence to money transmission or remittance entities 
3.1 It is important to make it clear that the BNB is the sole authority responsible for assessing all the 
conditions necessary for obtaining a licence set out in Article 26b(1) of the draft law. The ECB 
understands that Article 26b(2) is meant to gran t the BNB power of discretion over whether the 
requirements set out in Article 26b(1) items 5-9 are met. In this respect, it seems appropriate that 
such discretion also covers Article 26b(1) items 1. 
3.2 The recently adopted Directive on Paymen t Services in the Internal Market (PSD)9 sets out a 
harmonised set of licensing rules for providers of payment services that are not connected to taking deposits or issuing e-money. Since the PSD should be transposed into national law by 
1 November 2009, it may facilitate the future legisl ative process if applicable parts of the PSD are 
already taken into consideration. 
 4. Extension of the BNB’s supervisory powers 4.1 The ECB welcomes the extension of the BNB’s su pervisory powers to include the area of money 
laundering and terrorist financing and the BNB’s ri ght to conduct on-site inspections. However, 
Member States may not put their NCBs in a po sition where they have insufficient financial 
resources to carry out their ESCB- or Eurosystem-related tasks, as applicable
10. Therefore, the ECB 
expects that, when extending the BNB’s tasks, su fficient financial and personnel resources will be 
available to the BNB, both in terms of quantity and quality to carry out all its tasks, and in 
particular that its capacity to carry out ESCB-related tasks will not be affected11.  
  This opinion will be published on the ECB’s website.    Done at Frankfurt am Main, 12 December 2007. 
 
[signed] 
 
The President of the ECB 
Jean-Claude TRICHET 
                                                 
9  Not yet published. 
10  See the ECB’s Convergence Report 2007, p. 19, available on the ECB’ s website at www.ecb.int .  
11 See paragraph 3.2 of ECB Opinion CON/2007/17 of 18 June 20 07 at the request of the Italian Ministry of Economic 
Affairs and Finance on a draft law on the regulation and supe rvision of markets and the f unctioning of the competent 
independent authorities, paragraph 3 of ECB Opinion CON/2007/8 of 21 March 2007 at the request of the Czech 
Ministry of Industry and Trade on certain provisions of a draft law amending the Law on c onsumer protection relating to 
Česká národní banka, paragraph 2 of ECB Opinion CON/ 2007/23 of 2 August 2007 at the request of Banca Na ţională a 
României on a draft law on non-banking financial institutions.