EUROPEAN COMMISSION Brussels, 25.1.2017 SWD(2017) 24 final COMMISSION STAFF WORKING DOCUMENT BULGARIA : Technical Report Accompanying the document REPORT FROM THE COMMISSION TO THE EUROPEAN PARLIAMENT AND

THE COUNCIL on Progress in Bulgaria under the Co-operation and Verification Mechanism {COM(2017) 43 final}



Benchmarks to be addressed by Bulgaria pursuant to Commission Decision of 13/XII/2006 establishing a mechanism for cooperation and verification of progress in Bulgaria to address specific benchmarks in the areas of judicial reform and the fight against corruption and organised crime: Benchmark 1: Adopt Constitutional amendments removing any ambiguity regarding the independence and accountability of the judicial system Benchmark 2: Ensure a more transparent and efficient judicial process by adopting and implementing a new judicial system act and the new civil procedure code. Report on the impact of these new laws and of the penal and administrative procedure codes, notably on the pre-trial phase Benchmark 3: Continue the reform of the judiciary in order to enhance professionalism, accountability and efficiency. Evaluate the impact of this reform and publish the results annually Benchmark 4: Conduct and report on professional, non-partisan investigations into allegations of high-level corruption. Report on internal inspections of public institutions and on the publication of assets of high-level officials Benchmark 5: Take further measures to prevent and fight corruption, in particular at the borders and within local government Benchmark 6: Implement a strategy to fight organised crime, focussing on serious crime, money laundering as well as on the systematic confiscation of assets of criminals. Report on new and ongoing investigations, indictments and convictions in these areas



I Introduction This technical report summarises the information on which the Commission has based its assessment of the progress made by Bulgaria to up until the current date under the Cooperation and Verification Mechanism (CVM). The analysis is based on a variety of sources. First of all, the analysis relies to a large extent on information received from the Bulgarian authorities, both in written form and through ongoing contacts and meetings. In addition, the Commission is able to draw on a wealth of analysis and independent assessment from other international institutions, civil society actors, professional organisations, other EU Member States, and experts. Commission contacts with the Bulgarian administration across the full range of EU policies also help to inform this work. As part of the preparation of the reports, the Commission has been in close contact with the relevant government institutions and the Bulgarian judicial authorities active in the fields relevant for the CVM. These contacts also involve visits to Bulgaria by the Commission services several times a year, and in addition the Commission maintains a presence on the ground in Bulgaria. Once a year, the Commission includes independent experts from other Member States – judges, prosecutors, anti-corruption experts – in its visits. Finally, the Commission also meets with non-governmental organisations active in the area of judicial reform and anti-corruption projects, with professional organisations of judges and prosecutors, and with representatives of the business community. This report remains the responsibility of the Commission services. The Commission supports the efforts of Bulgaria in achieving the CVM objectives through funding under the European Structural and Investment Funds. In the 2007-2013 programming period Bulgarian judicial reforms have been supported by the European Social Fund (ESF) co-funded Operational Programme "Administrative Capacity" (OPAC) which has had as an overall objective to improve the functioning of the public administration, but also to enhance the professionalism, transparency and accountability of the judiciary. In the current programming period (2014-2020) the ESF is providing support to the Bulgarian judicial reform efforts through the Operational Programme "Good Governance" (OPGG), which has its own Priority Axis dedicated to the judiciary-related interventions for a total amount of EUR 30.2 million, which can be allocated by Bulgarian authorities to projects promoting organisational reforms, e-justice, and training. The CVM Commission Decision of 2006 defined six benchmarks for Bulgaria. The six benchmarks were conceived in a particular context and their concrete wording reflected the specific situation at the time. However, the underlying issues that they refer to have remained relevant in subsequent years. The first three benchmarks relate to the reform of the judicial system, including the constitutional framework (benchmark 1), the legislation (benchmark 2), and the improvement of the day-to-day functioning of the judiciary (benchmark 3). The following two benchmarks concern the fight against corruption, both high-level corruption (benchmark 4) and corruption more generally including at local level and the borders (benchmark 5). The final benchmark concerns measures to address organised crime (benchmark 6). While previous reports have tended to focus specifically on developments in the course of the year leading up to each report, the Commission decided on this occasion to take a longer time perspective. This analysis provides the basis for a more comprehensive assessment of the state of play with regard to each benchmark in a timeframe which covers the ten years which have passed since Bulgaria's accession to the EU and the establishment of the CVM. In the following chapters, this report will be looking back at developments in relation to each benchmark as well as the many recommendations contained in the Commission's reports over the years. While all the six benchmarks are interlinked and their fulfilment partially interdependent, the presentation below goes through each benchmark separately while focussing on the most relevant developments for each one. 2. Independence and Accountability of The Judicial System Benchmark 1: Adopt Constitutional amendments removing any ambiguity regarding the independence and accountability of the judicial system The first benchmark reflected concerns about aspects of the judicial system in Bulgaria expressed by the Council of Europe Venice Commission as well as by other observers and independent experts before Bulgaria's accession to the EU. Constitutional amendments adopted by the National Assembly of Bulgaria on 2 February 2007 sought to address several of these concerns and strengthen the independence and accountability of the judiciary. The Supreme Judicial Council (SJC) was given wide-ranging powers to manage the judiciary in regard to appointments, promotions, demotions, transfer and removal from office of magistrates as well as the management of the budget. In addition, the immunity of magistrates was limited to actions carried out when performing their official duties and an independent judicial inspectorate was created, which was to be elected by a 2/3 majority of the National Assembly and charged with the inspection of judicial bodies. The constitutional changes of 2007 were an important step towards establishing fundamental safeguards for the independence and accountability of the Bulgarian judicial system. During the following years, the focus of the CVM therefore turned to monitor their implementation and practical application. While formal constitutional rules play a key role in setting the legal parameters of the system, their implementation and practical application as well as the evolution of institutional norms and practices are equally important for the final outcome. Formal rules can never provide a complete answer to the challenges facing the judiciary, but have to be seen in the context of the actual practice. This chapter provides first a general overview of the progress made by Bulgaria over the past ten years towards creating a stable system of independent and accountable judicial governance (section 2.1.). This is then followed by a summary of the most recent actions taken by Bulgaria over the past year, since the last CVM report of January 2016 (section 2.2.). 2.1. Overview of developments under the CVM

The 2007 constitutional reform saw a strengthening of the independent role of the SJC in governing the judiciary as well as the creation of the new judicial inspectorate. While these changes were seen as having established the essential foundations for an independent and accountable judiciary in Bulgaria, they had not fully addressed all concerns raised. Supreme Judicial Council (SJC) The Commission's July 2012 report recalls that the Venice Commission had expressed reservations about the prominent role of the Minister of Justice within the SJC, as well as the large number of SJC members elected by the National Assembly. While the reform of 2007 has limited the role of the Minister to chairing the meetings of the SJC in a non-voting capacity and the power to present motions on some matters related to the career of magistrates, it was important to see how these powers would be exercised in practice. As noted by the Commission in 2012 , the fact that the Minister of Justice retained a number of roles within the SJC had not in practice been highlighted at the time as a matter of concern, as successive Ministers had in general tended to leave issues of management and careers to the SJC. In more recent years, one Minister of Justice was active in regard to a limited number of decisions regarding significant disciplinary cases. However, in these cases the Minister appeared to be acting in a capacity of last resort to correct perceived failings of the SJC to act in accordance with their responsibilities. These cases therefore rather illustrated checks and balances at work and were not the expression of a more systematic involvement in SJC decisions by the executive power. While the role of the Minister therefore appeared less contentious in practice, the role of the National Assembly in electing members of the SJC has been the subject of increasing tension over the years. The SJC is composed of 25 members: 11 elected by the National Assembly, 6 elected by judges, 4 elected by prosecutors, 1 elected by investigating magistrates, in addition to the chairs of the Supreme Court of Cassation and the Supreme Administrative Court as well as the Prosecutor General, all of whom are ex officio members. This composition has been criticised by the Venice Commission and others on the grounds that the significant parliamentary quota could create a risk of political influence within the SJC. In addition, the procedure for electing judicial members of the SJC has in the past taken the form of indirect elections, a method which was seen as giving a prevalent role for court presidents in the selection of candidates. The July 2012 CVM report set out how the Commission had recommended the use of direct election in 2012. Concerns about alleged undue influence on the decisions of the SJC have been a prominent theme in successive CVM reports and were given additional weight by separate concerns about non-transparent decision-making, an issue which was partly linked to the lack of a proper separation of competences with regard to judges and prosecutors within the Council. According to critics, there was at least a perceived risk that undue influence could be exerted on judges in a context where the quota of judges elected by their peers constituted only a small minority within the overall college of the SJC. These concerns were nourished by a lack of transparency and in some cases perceived arbitrariness in the decisions of the SJC on appointments and disciplinary proceedings. In 2015 new amendments to the Constitution were brought forward by the Government to address these concerns. The objective was to further strengthen judicial independence through the creation of two separate chambers within the SJC, which would deal separately with career decisions for judges and prosecutors. Following a prolonged period of political negotiations, a compromise was reached and the amendments were adopted by the National Assembly on 16 December 2015. In addition to the establishment of two separate chambers within the SJC, the final package of amendments included provisions to abolish the rule that votes in the SJC on staff matters were to be kept secret, while also introducing a 2/3 majority rule for the election of SJC members by the National Assembly and requiring direct elections of the judicial quota of the SJC on a one-magistrate one-vote basis. The two separate chambers within the SJC are competent to deal with staff matters pertaining to respectively judges and prosecutors as well as matters concerning the organisation and operation of the respective judicial bodies (courts and prosecutor's offices). The plenary of the SJC remains competent as regards the nomination of the Supreme Court Presidents and the Prosecutor General , release from office of a member of the SJC itself, the draft budget of the judiciary, management of physical premises, judicial training, and organisational matters common to the judiciary as a whole. The separation of career matters in two separate chambers was aimed at addressing the perceived vulnerability of judges to undue pressure through the SJC. However, concerns over the possible constitutional implications of a more far reaching change meant that the overall composition of the SJC was left untouched, with the political quota elected by the National Assembly retaining its 11 members. The distribution of this political quota between the two chambers proved a contentious issue at the final stage of the parliamentary process and was eventually decided through last minute changes to the amendments before the final vote, which saw an increase of the political quota in the judges' chamber and a reduction in the prosecutorial chamber compared to what was set out in the original compromise. The judges' chamber now consists of 14 members, including the Presidents of the two Supreme Courts, 6 judges elected by their peers, and 6 members elected by the National Assembly. The prosecutorial chamber in turn consists of the Prosecutor General, 4 prosecutors elected by their peers, an investigating magistrate elected by the peers, and 5 members elected by the National Assembly. The two chambers are chaired by the President of the Supreme Court of Cassation and the Prosecutor General respectively, whereas the plenary continues to be chaired by the Minister of Justice in a non-voting capacity. The final outcome was criticised by parts of the magistracy and civil society and also by the then Minister of Justice for not sufficiently protecting the judges against political influence, while at the same time failing to provide a sufficient counterweight in the prosecutorial chamber to the Prosecutor General's role as the managerial head of the prosecution. However, the package of Constitutional amendments as a whole was recognised, including in the Commission's 2016 report , as an important step towards a more independent and accountable judiciary. Following the vote on the constitutional amendments in December 2015, the changes were implemented in legislation through amendments to the Judicial Systems Act, and the two chambers were established within the SJC in spring 2016. Inspectorate to the SJC (ISJC) The second main institutional innovation introduced with the 2007 constitutional amendments was the establishment of an independent judicial Inspectorate with the SJC (ISJC), which was granted powers to inspect all judicial bodies, including courts, prosecution offices and the investigating services attached to the prosecution offices. The ISJC was established on 16 January 2008. It consists of an Inspector General and ten Inspectors, elected by a 2/3 majority in the National Assembly, and is competent to act ex officio as well as on alerts from citizens or public institutions. The detailed provisions are set out in the Judicial System Act. The ISJC is supported by an expert staff, carries out planned and ad hoc inspections, and issues recommendations to court managers and other institutions, including proposals to the SJC on the opening of disciplinary proceedings in cases where serious malpractice is identified during its inspections. It publishes an annual report on its activities. In 2010 a joint Commission on the analysis and follow-up to the ISJC recommendations was set up within the SJC to ensure greater visibility and to follow up on the findings of the ISJC. CVM reports have generally recognised the positive contribution of the ISJC towards improving judicial discipline and accountability, while also encouraging it to develop its activities further in the direction of addressing systemic problems within the judiciary. The 2/3 majority requirement for the election of the inspectors by the National Assembly should ensure that the inspectorate enjoys the support of a wide political majority. However, the election of the Inspector General proved to be a challenge when the mandate of the first incumbent ended in 2012 without there being an agreement on a successor. As highlighted in the Commission's 2015 report, for an extended period of time this deprived the ISJC of the authoritative and independent leadership with which it had been endowed by the Constitution. Eventually, however, the impasse was overcome, resulting in the election of a new Inspector General in spring 2015, followed by a new college of Inspectors in 2016. In the context of the constitutional reform of December 2015 it was decided to strengthen the ISJC by granting it additional competencies with regard to the performance of checks for integrity, conflicts of interest and financial disclosure of judges, prosecutors and investigating magistrates, as well as for ascertaining actions damaging the prestige of the judiciary or violating the independence of magistrates. These new provisions entail a significant increase in the responsibilities of the ISJC. Detailed legislative provisions were inserted in the Judicial System Act during Spring 2016 and came into effect in January 2017. 2.2. Developments since the last CVM report of January 2016 In its 2016 CVM report, the Commission recommended Bulgaria to implement the reform of the SJC through amendments to the Judicial Systems Act (JSA), to develop a track record within the SJC of transparent appointments based on merit and integrity, and to provide the ISJC with the authority and resources to fulfil its new role safeguarding integrity within the judicial system. These elements were taken up by the Bulgarian government in the context of a wider judicial reform, which involved two separate legislative packages of amendments to the JSA adopted by the National Assembly and promulgated in April and August 2016. Reform of the SJC The first package of JSA amendments concerned the reform of the SJC. The amendments introduce the two chambers for judges and prosecutors in line with the new provisions of the Constitution. They also define more in detail the organisational implications of this in terms of a new structure of sub-committees, most notably in regard to personnel issues where separate committees are established in each of the two chambers respectively for appraisals and competitions and for ethics. The JSA amendments also clarify the voting rules in relation to personnel matters, such as appointments, promotions, appraisals, granting of tenure, and disciplinary sanctions. In such matters decisions are taken by an absolute majority of 8 votes in the judicial chamber (14 members), 6 votes in the prosecutorial chamber (11 members), and a qualified majority of 17 votes in the plenary (25 members). Other decisions are taken by a simple majority. A new provision also specifies that, as a rule, meetings of the SJC are public and shall be streamed live on the internet. It confirms that all decisions are to be taken by open ballot, whereas before the decisions on personnel matters were taken by secret voting. The increased transparency of decisions and votes within the SJC allows for closer scrutiny of such decisions by the public and interested stakeholders. Since the reorganisation, the two chambers have decided on a number of organisational matters and personnel issues. While the reform has brought more transparency in the functioning of the SJC, the changes have not been successful in significantly diminishing the level of controversy surrounding it or in dispelling allegations of undue influence on its decisions. In the judicial chamber, the decision-making process has revealed strong tensions among the members. In some cases the judicial chamber has not been able to reach the required majority to decide on key appointments. Even when successful, decisions have often been taken in the context of a strongly divided chamber, with narrow votes even in cases where there was only a single candidate for the post, and in one case the chosen candidate has been the cause of wider controversy on integrity grounds. There have however also been examples of unanimous decisions on high-level appointments. In the prosecutorial chamber, in turn, decisions have generally seen less overt controversy but have, on the contrary, generally been taken unanimously or nearly unanimously, often with only one candidate for the post. On 9 December large numbers of judges took to the streets of Sofia in protest against the allegedly unbalanced approach taken by the SJC in regard to working conditions in the Sofia courts. The leadership of the Sofia Regional Court, supporting the protests, decided to resign. These protests followed an SJC decision the previous day to launch inspections of the Sofia City Court and the Sofia Regional Court, based on an alert from the Prosecutor General about delays in the processing of cases within the two courts. However, judges contend that the delays are the result of years of inactivity on the part of the SJC in dealing with excessive workload in the two courts and that the decision to launch the two inspections effectively constitutes an interference by the Prosecutor's Office into the internal affairs of the courts. These allegations reflect continued strong concerns among judges about politicisation of the decisions of the SJC.

The amendments to the Constitution of December 2015 also contained important changes to the way the SJC members will be elected in the future. These rules were further elaborated in amendments to the JSA in April 2016, which, in addition to specifying the detailed procedures for the direct election of the respective quota by the general assemblies of the judges, prosecutors and investigating magistrates, also introduce some additional changes to the procedure for election of the political quota by the National Assembly. The nominations are examined by a committee within the National Assembly and shall be accompanied by "detailed reasons in writing on the professional standing and moral integrity of the candidates, including opinions expressed by professional, academic and other organisations". After hearing each candidate, the competent committee shall prepare and publish a similarly "detailed and reasoned" report and thereby present each candidate for the vote in the plenary of the National Assembly. The plenary of the National Assembly shall elect each member of the SJC separately, by a majority of 2/3 of the National Representatives. As for the non-parliamentary quota, the new JSA provisions adopted in April 2016 clarify in detail the procedures through which members "shall be elected directly by secret ballot by the judges, by the prosecutors and by the investigating magistrates, respectively". The procedures for the election of the SJC will be applied for the first time in 2017, as the mandate of the current SJC ends in the early autumn. Inspectorate of the SJC (ISJC) The other major change that was brought about by the constitutional amendments of December 2015 concerned the role of the ISJC. The Inspectorate is responsible for examining the operation of the judicial authorities without affecting the independence of judges, jurors, prosecutors and investigating magistrates in the performance of their functions. In accordance with the new constitutional provisions, the ISJC will in future conduct checks for integrity and conflict of interest of judges, prosecutors and investigating magistrates, of the financial interest disclosure declarations, as well as for ascertaining any actions damaging the prestige of the judiciary or violating the independence of judges, prosecutors and investigating magistrates. The very general formulations in the Constitution gave rise to difficult discussions in the context of preparing the legislative amendments to the JSA in 2016. Eventually, the relevant provisions were included in the August package. The key provisions have entered into effect only in January 2017, so as to give time for the ISJC to adopt implementing rules and establish the necessary organisational capacity to carry out these new and complex tasks. The ISJC itself submitted several written opinions to the Ministry of Justice in the course of the negotiations, insisting in particular on the need for clear procedures and rules set out in the law, as well as allocation of sufficient resources for the task. The new provisions on the ISJC and its activities related to the above-mentioned tasks span several chapters of the amended JSA. They specify that judges, prosecutors and investigating magistrates shall submit to the ISJC a declaration of personal property and interests. Within one month of the expiry of the deadline for submission of declarations, the ISJC shall upload the declarations on its website, together with a list of magistrates (if any) who failed to submit their declarations within the deadline. Within 3 months of the deadline for submission of a declaration, the ISJC shall verify the authenticity of declared facts. Broad powers were granted to ISJC for access to sources of information regarding the circumstances subject to declaration in order to ensure effective control over Bulgarian magistrates’ property. The inspection is performed through comparing declared facts with the received information and ends in a report on compliance or non-compliance. The ISJC will in future also be called upon to perform integrity checks and to establish actions undermining the prestige of the judiciary or violating the independence of magistrates so as to ensure compliance with the principles laid down in the Code of Ethics. Checks can be initiated upon an alert , on request of the magistrate concerned or ex officio by the ISJC. Checks are performed within two months from registering the alert and result in the drawing up of a reasoned report. In the course of inspections data relevant to the subject of the inspection shall be collected, and the inspected person shall be heard. The reports are adopted by the college of the Inspectorate and can result in a proposal to the respective chamber of the SJC for a conflict of interest to be ascertained and/or disciplinary proceedings to be instituted. The ultimate decisions for disciplinary and other consequences are therefore taken by the SJC, based on analysis prepared by the ISJC. 3. Legal Framework Benchmark 2: Ensure a more transparent and efficient judicial process by adopting and implementing a new Judicial System Act and the new Civil Procedure Code. Report on the Impact of these new laws and of the Penal and Administrative Procedure Codes, notably on the pre-trial phase. The second benchmark focuses on the legal and procedural framework of the judicial system. The Judicial System Act (JSA) is the fundamental law governing the judiciary, setting out the institutional structures and division of competences between the various parts of the judiciary. The procedural codes in turn are crucial for the functioning of the various judicial bodies. Together these legal frameworks have an important bearing on the transparency and effectiveness of the judicial process. Stability and coherence of the legal framework is a precondition for a properly functioning judiciary. While legislation is a crucial topic of its own, it is also necessary to consider it in context, taking into account the way it is implemented in practice. This benchmark is therefore closely linked to benchmark 3, which is discussed in the next chapter. However, the formulation of a separate benchmark on legislation underlines the importance that was attached to the need for continued attention to be paid to the legal framework at the time of the accession. This reflected concerns over the ability of courts to deal with cases in a timely and transparent manner in a context of complex procedural rules. Special emphasis was given to the procedural rules governing pre-trial investigations in criminal cases, an issue which is closely related to benchmarks 4 and 6 concerning investigations into high-level corruption and organised crime. This reflects concerns at the time that the complex procedures in these areas were hampering an effective law enforcement response. 3.1. Overview of developments under the CVM The years following Bulgaria's accession to the EU have seen a number of legislative amendments being enacted in order to address the CVM benchmarks. Some of these concerned the JSA, with amendments to implement the above mentioned constitutional changes affecting the SJC and the ISJC as well as to clarify broader issues in the functioning of the judicial system. Others have been directed towards improving the various procedural laws. Judicial System Act (JSA) In the immediate aftermath of accession in 2007 a new JSA was adopted in order to promote reform within the judiciary. The new law contained important improvements in addition to the strengthened independent role of the SJC and the establishment of the ISJC. The system of competitions for appointment to judicial offices was introduced, the principle of random allocation of cases in courts was prescribed in the law, and the National Institute of Justice was established as the central institution responsible for the training of magistrates. The JSA was amended several times over the following years. Amendments in 2009 clarified the rules on the establishment of disciplinary panels within the SJC and gave the ISJC powers to appeal disciplinary decisions of the SJC. Subsequent amendments in 2010 improved the framework for appraisals within the judiciary inter alia by establishing permanent appraisal commissions within individual courts and prosecutor's offices. The 2010 amendments also further extended the managerial powers of the SJC. As noted in the Commission's 2012 report, the SJC had by then been vested with all relevant powers to properly manage human resources and judicial structures for the benefit of judicial efficiency. In 2012 the law was amended again to introduce further transparency in the procedures for the selection of members of the SJC. While several improvements had therefore been made in the first years after accession, the debate continued, pointing to a need for further changes. In 2015 preparations were launched on yet another broad legislative reform, initiated in the context of a judicial reform strategy which had been prepared by the Minister of Justice and adopted by the government at the end of 2014, and endorsed with broad majority by Parliament at the beginning of 2015. This wide-ranging reform of the JSA was adopted in the summer of 2016 after more than a year of extensive consultations with judicial bodies and other relevant stakeholders. Criminal procedure A new criminal procedure code entered into force in 2006, but the new law retained important elements of the previous system. As a result, what has been widely seen as an overly formalistic procedural tradition was perpetuated, with serious consequences for effective justice. Past CVM reports have referred to the challenges faced by Bulgarian prosecutorial and investigatory bodies under the existing criminal procedure code and their consequences in terms of hampering effective investigation and prosecution, notably in the context of especially complex cases related to high-level corruption or organised crime. These concerns have increasingly come to the fore again in recent years, as reported in meetings with Bulgarian authorities. Concrete problems reported by Bulgarian pre-trial authorities include complex rules for the collection of evidence during the pre-trial stage and strict requirements for the content of indictments, which contribute to frequent referrals from the court back to the prosecution for further investigation. These challenges cause long delays in trials and complicate the pre-trial procedure, eventually leading cases to fail, partly due to statutory time-limits being reached or, more frequently, by a lack of evidence for key elements of the charges. The new criminal procedure code of 2006 was reported to have a limited positive effect, but did not entirely address the challenges. A number of further amendments were made to the criminal procedure code during the following years. In particular, amendments in 2010 extended the investigatory powers of the police , clarified rules on accessibility of evidence, allowing certain categories of police officers to testify in court, and introduced a provision allowing prosecutors to appeal court decisions which referred cases back for further investigation. Stricter requirements for medical certificates and a possibility for courts to assign reserve defence counsels were also introduced to deal with a widespread problem of absenteeism of defence lawyers. The 2010 reform also established a specialised court and prosecutor's office with jurisdiction over cases involving organised crime, which became operational in 2012. While initially, the specialised court was intended to also deal with high-level corruption cases, this element was not accepted by Parliament. Corruption cases therefore remained within the remit of the general courts. The amendments of 2010 have had some positive impact but did not deal with the more fundamental aspects of the formalistic criminal procedures. Penal Code

A closely related topic concerns the penal code, which as stated in the Commission's report of February 2008, "does not differentiate sufficiently between different degrees of crime and appears structurally outdated". The Bulgarian penal code dates from 1968 and while it has been amended several times, some practitioners and experts have pointed to the need for a thorough reform, if not a complete replacement, of the code. Among the issues raised are the existence of apparent inconsistencies in levels of sanctions between offences, the presence of offences which are less relevant in today's environment or which could be better addressed through administrative sanctions, and the formulation of offences in some areas – such as corruption related crimes – that are not well adapted to the types of crime faced by law enforcement authorities in today's Bulgarian society. Over the past ten years, there have been numerous amendments of the code, some reflecting ad hoc issues on the political agenda and others reflecting European or international commitments by Bulgaria. However, attempts at a more thorough and systematic reform of the penal code have proved elusive. In 2009 the Bulgarian government adopted a new concept of criminal policy, which was meant to point the way for a reform of the penal code. Preparations were launched in cooperation with technical experts and stakeholders, leading to the publication of a new draft of the general part of the code in 2012, while working groups continued working on the specific parts of the code. These initially promising efforts were continued over the subsequent years, leading to the publication of a complete draft for a new penal code in spring 2014. However, while the need for a new code was strongly supported by the prosecutor's office and other stakeholders, the draft received criticism from other parts of the judiciary, including the Supreme Court of Cassation, and faced opposition in the National Assembly. Due to the dissolution of the National Assembly in July 2014, the draft was never voted on, and the following government, entering into office in November of the same year, decided not to pursue the adoption of the law. Instead a new reflection process was initiated with a view to the development of a penal policy which could clarify the extent to which a root-and-branch reform of the code was needed, or whether efforts should rather focus on more targeted amendments of the existing code. Civil and Administrative procedures A revised civil procedure code was adopted in 2007 with the objective of speeding up proceedings and improving enforcement of court decisions. The new provisions have been monitored by the ISJC, which has been able to give recommendations to court management and refer cases of contradictory jurisprudence to the supreme courts for adjudication. The new code appears to have had a positive effect in terms of speeding up procedures. Although delays remain a significant problem in some courts this appears not primarily to be linked to problems in the procedural code. Amendments of the administrative procedure code were adopted in 2007 and in 2011 in order to improve proceedings and re-organise the first-instance jurisdiction in a number of administrative cases from the Supreme Administrative Court to the district administrative courts. Early evaluations of the impact of the reform concluded that the changes had been positive, although there were also some elements which could require further improvement. One of the challenges raised by the Bulgarian authorities as well as by independent experts relates to the role of the Supreme Administrative Court as both first and final instance court with jurisdiction for a great number of government decisions, including not only ministerial decisions and decisions of the SJC but also decisions of a number of agencies, where jurisdiction has been set out in legislation. This situation for example can create challenges in regard to the management of court panels within the Supreme Court to deal with the same cases both at first instance and in appeal as well as with cases appealed from the regional administrative courts, as well as in the application of random allocation of cases. 3.2. Developments since the last CVM report of January 2016 In its 2016 CVM report the Commission recommended Bulgaria to adopt amendments to the Judicial System Act and a reform of criminal policy in line with the government's judicial reform strategy, and to prepare a set of targeted amendments to address problems in criminal procedures. These elements were all taken up by the government in 2016, although with varying degree of progress made in the course of the year. Judicial System Act In 2016 the Bulgarian Parliament adopted a broad package of amendments to the Judicial System Act. Elements have already been referred to above as they relate to the implementation of the constitutional amendments of December 2015. In addition to this, the package amounts to a broad reform of key elements of judicial management: extending the role of judges in the internal governance in courts, decentralising some aspects of the organisation of prosecutor's offices, improving the system of career development for magistrates, and clarifying the rules on secondments, appointment of lay judges, and disciplinary proceedings, among other changes. One important aim of the reform is to provide the opportunity for individual judges to take a more active part in the governance of their courts, for example by giving them a bigger say in the process of appointing court chairs. General assemblies within each court are given the competence to formally nominate candidates for administrative head of the relevant court and to hear all candidates. While the final decision remains with the SJC, this new procedure is seen by its proponents as an important element of democratic governance within the judiciary. It is in line with the CVM recommendation of 2016 in favour of "reforms to give more say to individual judges and prosecutors". Furthermore, the new powers of court general assemblies include: hearing the candidates for deputy chairs, nominated by the court chair, and expressing an opinion on the nominations; determining the number and composition of the divisions within the court, if any, and their specialisation by subject matter; discussing the annual report on the court's activity; and giving opinions on matters related to the working arrangements of the court. The JSA amendments also contained amendments to clarify the internal organisation and strengthen the external accountability of the Prosecutor's Office. The amendments specify that prosecutors and investigating magistrates are to be directed by the administrative heads of their respective prosecutor's offices, which in turn refer to the Prosecutor General. The Prosecutor General is directly responsible for the organisation of the supreme prosecution offices and the national investigation service, including the appointment of staff in these bodies. Furthermore, he supervises and provides methodological guidance for the work of all prosecutors and investigators through written instructions, and also directs the internal control activities within the prosecution service, which includes performance evaluation, disciplinary procedures, monitoring of activity, ensuring the dissemination of best practices, and ensuring implementation of priorities. Each year the Prosecutor General presents an annual report on the operation of his services. The report is made public and is to be the subject of a hearing at the SJC as well as a general debate at the National Assembly. With regard to the autonomy of individual prosecutors, while prosecutors work under the supervision of their superiors and their decisions may be revoked by a reasoned decision of a superior prosecutor's office, a new provision seeks to ensure that "verbal orders and directions in connection with work on cases and case files shall be inadmissible". Furthermore, a prosecutor whose decisions are revoked by a superior may lodge an objection with a superior prosecutor's office. Amendments are also introduced with regard to the preparation of decisions within the SJC on appraisals and promotions, including the introduction of additional criteria for the appraisal of judges and prosecutors. Furthermore, a centralised committee is set up in connection with each chamber of the SJC, composed of members of the respective chamber of the SJC, as well as members selected from among active magistrates, which are appointed for a one-year term by the general assemblies of the supreme courts and of the supreme prosecutor's offices and national investigation service. The committees for appraisals and competitions, together with the committees on ethics, will play a key role in preparing decisions of the two chambers on personnel issues. The ethics committees are charged with conducting enquiries and with drawing up opinions regarding the moral integrity of candidates for judicial offices, including future heads and deputy heads of courts and prosecutor's offices. The committees on appraisals and competitions in turn will draft proposals for the consideration of the respective chambers of the SJC on appointments and promotions and other personnel matters. In regard to disciplinary proceedings, the ability of the members of the SJC to initiate such proceedings for ordinary magistrates is abolished. Disciplinary proceedings are instituted by a decision of the SJC at the proposal of the immediate administrative head, a superior administrative head, the ISJC or the Minister of Justice. Criminal procedures and penal code reform In 2016 a package of draft amendments to the criminal procedure code was prepared in a working group involving experts of the Supreme Court of Cassation and the Prosecutor's Office. Among other issues, these draft amendments are intended to address the problem of frequent referrals of cases back to the prosecution on procedural grounds. It is proposed to introduce a separate preliminary hearing at the first instance court in which any procedural violations during the pre-trial phase are to be finally identified and corrected. Following the preliminary hearing, it would no longer be possible for the court to refer the case file back to the prosecution, which should discipline both the prosecution and the defence at an early stage of the procedure. Under the current rules, cases reportedly tend to be allowed to continue to court and even to the appeal stage in spite of the presence of procedural or other flaws, although both parties know that raising the issues at a later stage can oblige the court to refer the case back to the prosecution with instructions for correction of the errors found. Such referrals constitute one important explanation for delays in criminal cases. Moreover, besides the delay itself, this phenomenon is also seen as a possible reason for cases to fail in court, as the late discovery of flaws in the initial construction of an indictment by the prosecutor or in the conduct of the investigation can often be difficult to remedy at the time when the issue is eventually raised, which may even happen several years later during the proceedings at the appeal instance. As could be expected, the problem of cases being returned by the court is particularly serious in regard to complex cases such as those involving corruption and organised crime. Another significant element of the proposals concerns the inclusion within the jurisdiction of the Specialised Court and Prosecutor's Office for Organised Crime of high level corruption cases involving ministers, members of parliament, magistrates, and incumbents of certain other high level offices. The stated objective is to ensure a higher degree of specialisation of competence in high level cases , while leaving other corruption cases with the general courts and prosecutor's offices. However, some observers were critical of the proposals which were not seen as being based on a proper prior assessment and debate. Further amendments aim at simplifying procedures for the investigation of less serious crimes, more flexible rules for the application of expedited procedures in complex cases , new possibilities for remote questioning of expert witnesses by phone or video conference, more clarity about deadlines for publishing the reasoning for court decisions, stronger safeguards for the presumption of innocence during pre-trial proceedings , and swifter execution of decisions of the Supreme Court of Cassation involving prison sentences.

The draft amendments were published for consultation and also discussed in the Judicial Reform Council in September 2016. The final endorsement and submission of the draft amendments to the National Assembly is however still pending, and the prospect and possible timing of their eventual adoption and entering into force therefore remains uncertain. If passed, the amendments could contribute to addressing a number of key problems identified in CVM report as affecting criminal procedures in Bulgaria. It is however likely that some of the proposals will solicit further debate. In particular, as mentioned above, concerns were raised from among stakeholders and experts about the proposed transfer of jurisdiction in high-level corruption cases from the Sofia City Court to the Specialised Court, in particular if such a transfer was carried out without a careful prior analysis of the possible impact in terms of staff resources needed and without sufficient measures taken to avoid any potential disruption or delay in ongoing cases. Some stakeholders also considered that further amendments could be needed in order to address more directly the core issues of the very formalistic criminal proceedings in Bulgaria. Prosecutors in particular have pointed to issues such as strict requirements for the content of indictments and very complex rules on collection of evidence. Such more fundamental reforms would call for careful analysis to assess the balance between expediency and procedural safeguards. Also, some of the challenges could be linked to an overly strict interpretation in some instances, rather than problematic rules per se. While the Bulgarian rules as such may not necessarily be fundamentally different from those in some other Member States, their application appears to be particularly cumbersome. Furthermore, some prosecutors have complained about inconsistent practices in different courts and even within the same court with regard to the interpretation of certain procedural requirements. Finally, with regard to the reform of the penal code, the Bulgarian government in 2015 initiated a reflection process with a view to preparing a general reform of the code in regard to the definition of offences and penalties. The government underlined its intention to ensure that the reform should be based on the best European and international practice, while avoiding decisions based on immediate political considerations, by basing the reform on a broader conception of a new penal policy prepared in cooperation with experts and stakeholders. International expert assistance was also drawn upon in this context. Given the apparent need for careful preparation, a general reform of the penal code now appears less likely to take place in the short term. 4. Continued Reform of the Judiciary Benchmark 3: Continue the reform of the judiciary in order to enhance professionalism, accountability and efficiency. Evaluate the impact of this reform and publish the results annually. Reform is a continuous process and the adoption of changes to constitutional or legislative provisions needs to be taken forward to implementation. Ultimately the assurance that the judiciary is working in a professional, accountable and efficient way requires a competent management, as well as a culture based on these values to permeate the entire structure of judicial authorities. This is the background for the third CVM benchmark, which calls for Bulgaria to continue its reform efforts, including through continuous evaluation and transparency about impacts. Bulgaria has framed its efforts in this direction in the context of broad judicial reform strategies put forward at political level. The first one was adopted in 2010, and a more recent update was adopted at the end of 2014 and endorsed by the National Assembly in January 2015. In more concrete terms, the responsibility for reform lies to a large extent with the Supreme Judicial Council (SJC) to which the Constitution has given broad powers to manage the judiciary in more operational terms, without interfering with the independence of individual judicial bodies. In addition, the heads of the various judicial bodies carry independent managerial responsibilities, not least the Presidents of the two Supreme Courts and the Prosecutor General, who not only manage their respective institutions but also sit on the SJC as ex officio members. This chapter will first give a general overview of the developments over the past ten years before proceeding to the more recent developments over the past year. 4.1. Overview of developments under the CVM The evolution of the Bulgarian judiciary over ten years is evidently a vast topic and cannot be covered comprehensively in the context of this report. What follows therefore focusses on the main developments related to judicial reform in areas which have been highlighted in past CVM reports. Important topics in this regard include the general system of personnel management, disciplinary proceedings, judicial training, allocation of cases in courts, the judicial map, transparency and accessibility (e-justice), and the reform of the prosecution. Many of these topics concern directly or indirectly the quality and transparency of work in the SJC as the main governing body of the Bulgarian judiciary. Role of the SJC Decisions of the SJC have continued to be a contentious issue over the years and this has led to a number of improvements in procedures. Many of the changes focussed on formal steps. In the period immediately following accession, steps were taken to improve transparency in the work of the SJC by making the meetings public and publishing its decisions on a website. This has recently been followed up by granting public access to voting records on personnel issues. Over the years there have been many changes to rules of procedure to clarify proceedings in various matters, which has also been combined with the establishment of specialised committees. Since 2011, the work of the SJC has been facilitated by specialised committees within individual judicial bodies focusing on appraisals and promotions as well as on ethics and integrity. These local committees were mirrored by specialised committees within the SJC. As mentioned in chapter 3 above, these structures saw further reforms in 2016. In 2011 the SJC also established a special committee to ensure closer cooperation with the ISJC on disciplinary issues, and the SJC adopted a set of internal rules on the conduct of disciplinary proceedings in 2014. In order to enhance transparency, the SJC set up an associated 'civic council' in 2012 gathering a number of civil society actors and professional associations to follow and deliberate on topics under consideration by the SJC. This was followed up in 2015 with a broader communication strategy aimed at increasing transparency around the work of the judiciary in general, including the SJC. In spite of the many improvements made over the years in institutional terms, the functioning of the SJC has remained controversial in a number of areas. Notably issues such as transparency and accountability of the SJC have continued to be raised by stakeholders, further underlined by the decision of several of the relevant organisations to leave the SJC civic council over the years , as well as the frequent public criticism by professional associations and NGOs of decisions taken. Tensions within the Council were one of the reasons for the 2015 constitutional amendments and the subsequent reform of the SJC already outlined in chapter 2 above. Personnel management within the judiciary A key issue in any organisation is the allocation and management of staff. In the judiciary, this includes issues such as appointments, appraisals, promotions and granting of tenure. Appointments have already been touched upon in chapter 2 above as far as high-level appointments are concerned. As for more standard appointments, Bulgaria early on introduced the principle of competitive appointments, meaning that positions within the judiciary are filled through competitive procedures. Overall, this system appears to be now well-established. There also exists a separate path into the service for experienced lawyers. The system for obtaining tenure is also well established. Performance assessment of magistrates is an issue which has been raised in past reports. The present system has been described as based on a rather formal exercise which does not allow for a proper dialogue or a reasoned assessment of the individual judge or prosecutor. An additional aspect of this issue has been the indirect link with disciplinary proceedings. The latter appears to some extent to have been applied as a mechanism to address efficiency problems within courts. This issue has most commonly been associated with the problem of delays in the publication of reasons for court decisions, which has at times also been addressed through the opening of disciplinary proceedings. While the use of disciplinary proceedings can be relevant in the event that delays appear to be deliberate on the part of the magistrate concerned, decisions or proposals for disciplinary proceedings have in many cases been met by the argument that the delays in question rather reflected a problem of workload management within the respective court. Such arguments have also in some cases been given credit by rulings of the Supreme Administrative Court. In fact, the use of disciplinary proceedings for issues which should in many cases rather be addressed as a matter of performance assessment could have many reasons. In the Bulgarian context one element appears to have been the lack of effective mechanisms to appropriately assess the personal performance of magistrates. Performance assessment is one of the areas addressed in the 2014 judicial reform strategy, which led to the introduction of new provisions in the Judicial Systems Act in 2016 and is currently the object of a process to formulate a new methodology for appraisal and promotion of magistrates. More generally on disciplinary proceedings, as also mentioned in chapter 2 above, the use of disciplinary proceedings has been a frequent source of controversy in Bulgaria, with critics of the SJC arguing that disciplinary rules are being used in a non-transparent manner and possibly for ulterior motives. It should be noted, however, that before 2007 disciplinary proceedings against magistrates were reported to be virtually non-existent. While the SJC has struggled to develop a transparent and consistent practice in this area, there has been a clear change since 2007 in the sense that a system now exists to hold magistrates disciplinarily accountable for flagrant misconduct in connection with the execution of their duties. The system was reinforced with the introduction of a code of ethics for magistrates in 2009. Linked to the issue of appraisals and disciplinary proceedings is another topic of high relevance in the Bulgarian context, namely that of workload management. This issue has been identified as a major issue in successive CVM reports in relation to appraisals and disciplinary proceedings as well as the broader discussion on the overall system for allocation of staff to individual judicial organs. A significant amount of work has taken place within the SJC over the past years in order to develop objective standards for the assessment of workload, taking into account the relative complexity of different types of cases. By 2016 this work was completed for both prosecution offices and courts, resulting in a 'workload standard', which can provide the basis for a more objective assessment of the workload for the individual magistrates. In parallel with the more long-term work undertaken by the SJC to establish objective workload standards, the SJC has taken measures over the years to address the most flagrant inequities in workload between judicial bodies. In spite of these measures, however, there appears to be a continued serious problem of uneven workload in some courts. In particular, some of the larger courts appear to continue to experience serious problems in this regard. At the same time, there are judicial bodies with very low relative workload, from which resources could be reallocated to those with heavier workload. With the new workload standards it should be possible for the SJC to take informed decisions on this issue and perhaps move more quickly to address some of the most serious unevenness between courts. Judicial map, e-justice and transparency An issue linked to that of personnel management concerns the overall structure and number of judicial bodies and their respective jurisdiction, the 'judicial map'. Another closely related subject is the introduction of new IT tools to improve the accessibility and transparency of justice. The discussions on the judicial map have proven very sensitive both within the judiciary itself and in wider society. In light of the need for broader support in society as well as within the ranks of the judiciary, the SJC has taken a cautious approach to the reform of the judicial map over recent years. Nevertheless, among Bulgarian authorities both at political level and within the judiciary itself there seems to be an understanding that the current system – with more than a hundred local courts, 28 regional courts and five appellate regions for a population of 7 million – needs a comprehensive reform. A first careful step was taken in 2014 with a minor reform of the military courts. A separate process to prepare a comprehensive reform of the local courts has been ongoing for several years and in 2015 reached the stage of general consultations on a number of draft criteria to be applied for the restructuring of those courts. The debate on the higher level courts in turn has only started rather recently. An important issue to consider in the context of a reform of the court map is how to ensure adequate access to judicial institutions for citizens throughout the national territory. Here the development of e-justice could contribute to the solution, an issue which has been on the agenda in Bulgaria over the past ten years. Already at the time of the accession to the EU rules were put in place to require courts to publish court decisions online. The implementation of this requirement took some time to ensure in all instances, but is today general practice.

In recent years electronic case management systems have been introduced in most courts, in some cases also allowing for external communication. However, some courts still complain about lack of efficient IT based systems for the management of case files as well as for communication. A unified electronic system for the management of criminal cases has been implemented within the prosecution already in 2014 but has not yet been extended to the courts. Communication between prosecutor's offices and police also appears to be facing problems due to the lack of a common IT system, which may be a cause of delays in pre-trial proceedings. It is planned to address the challenges related to the introduction of electronic tools in the Bulgarian judiciary over the coming years in the context of a broader government e-justice strategy. Allocation of cases in courts An area where Bulgaria has for many years had electronic systems in place concerns the allocation of cases to individual judges within courts. According to the law, the decision on which judge should be charged with a particular case should be decided in accordance with the principle of random allocation. The system of random allocation of cases has been adopted as a mechanism for the prevention of undue influence and corruption in the courts, as the use of automatic, electronic systems was supposed to remove any possible human interference in the selection of the judge for any particular case. However, as noted in successive CVM reports, allegations of incorrect or manipulated application of the principle of random allocation have been a recurrent theme of debate in Bulgaria, with consistent and widespread criticism that these systems were regularly tampered with or circumvented in order to allow certain economic or political interest to predetermine the judge handling the case and by this ultimately the outcome of certain cases. While such allegations continued for several years, the SJC was initially slow to react to these controversies, in spite of the evident damage that this did to the overall reputation and credibility of the justice system and the perceived independence of the judiciary in Bulgaria. The problem seemed to be connected to the existence of separate IT systems in different courts which seemed vulnerable to local intervention. In 2014 an interim solution was introduced by the SJC whereby the local case allocation decisions were to be reported on a daily basis to a central server at the SJC. Alongside this effort, the SJC adopted a set of common rules for the application of the local systems whenever special situations arise, such as judges withdrawing from a case or having to be excluded from the selection due to absence or high workload. The application of these rules is checked during inspections by the ISJC. Meanwhile, towards the end of 2014 a major scandal broke out in relation to the allocation of two cases at the Sofia City Court: this prompted the SJC to take further action. The result was the development of a new software system for allocation of cases through a centralised server located at the SJC, which was eventually introduced in October 2015. Following the introduction of this system, all courts carry out the allocation of cases directly through an online server located at the SJC, where all actions are systematically logged so that any intervention can be subsequently checked. On the basis of the December 2014 incident in the Sofia City Court, an inspection was carried out by the SJC in spring 2015. The inspection concluded that the court had been the subject of serious mismanagement, but did not assign clear responsibility for the misconduct. Nevertheless, the incident did precipitate the replacement of the management of the Sofia City Court in spring 2015. Judicial training Bulgaria has a well-established institution for judicial training, the National Institute of Justice. It is responsible for the initial training of magistrates which is obligatory for all regular appointees. In 2010 the length of the obligatory initial training was extended from 6 to 9 months , and this is still the situation today. The training provided by the institute is generally recognised as being of a good quality, providing an adequate basis for new entrants to the judiciary. In addition, the institute provides a broad range of further training courses for magistrates, which is continuously widened to include new subject matters. After the initial training, however, there is no obligatory training of magistrates, which is left at their own discretion. Bulgarian authorities stress that training is generally available, but in some judicial bodies the existing workload can make it a challenge for some magistrates to attend courses to further develop their knowledge. The National Institute of Justice has a formal status regulated by law and is governed by a board including five representatives of the SJC and two for the Ministry of Justice. Its basic funding comes from the national budget. However, as mentioned in past reports, the financing from the state budget has not been increased in line with the growing activities of the institute over the years, with the result that over half of the budget is being financed through various outside grants. Reform of the prosecution services Under the Bulgarian Constitution, the Prosecutor's Office is part of the judicial system and as such independent of the executive power. Over the ten years since Bulgaria's accession to the EU, there have been several reforms of the internal structure of the prosecution. Many of them have had to do with internal governance and management. Major structural reorganisations of the Prosecutor's Office have been launched several times, typically following the entering into office of a new Prosecutor General. A number of more targeted changes have been aiming to address concerns about lack of effectiveness in the prosecution of corruption and serious organised crime. In 2008 a specialised unit was established within the Sofia City Prosecutor's Office to prosecute cases related to EU funds fraud. In 2009 a specialised unit involving the Prosecutor's Office, the Ministry of Interior and SANS was set up to focus on cases involving organised crime. This was followed up in 2012 with the establishment of the Specialised Prosecution for organised crime, attached to the then newly-created Specialised Court. In 2012 a structure of joint teams between the same three institutions was established for the investigation of financial crimes and high-level corruption. More recent innovations have included specialised units for crimes committed by magistrates and for corruption cases, which were in 2015 merged into a new specialised unit for high-level corruption attached to the Sofia City Prosecutor's Office. Efforts were also made to improve the supervision of cases of special public interest through special procedures and reporting requirements. These measures were further strengthened in 2014. A number of other measures have been taken over the years to improve training and general management within the prosecution service. A key issue, which continues to be raised, concerns the degree of supervision of individual case files by superior prosecutors, which is linked to a general impression in wider society of the prosecutor's office as a very hierarchically structured and at times non-transparent organisation which is vulnerable to undue influence by politically or economically powerful interests. Some efforts have been made to address such concerns through the development of a communication strategy and legislative amendments with the objective to clarify the autonomy of individual prosecutors. However, the fact remains that professional and civil society actors continue to express concerns about the role of the prosecution and the Prosecutor General in particular. Another area identified early on in CVM reports as particularly problematic concerns the interaction between the prosecution and the various investigatory agencies. These concerns have led to the conclusion of a number of agreements between the prosecutor's office and other relevant institutions in order to clarify working relationships. Nevertheless, such issues have continued to be raised in the context of the investigation and prosecution of corruption and organised crime. 4.2. Developments since the last CVM report of January 2016 The January 2016 report recommended Bulgaria to adopt a reform of the judicial map for the regional courts and a roadmap for a more general rationalisation of the courts at all levels to improve overall quality and efficiency, including the reallocation of resources in light of an analysis of workload, to establish a timetable for the introduction of e-justice, to develop a practice of motivating disciplinary decisions in accordance with clear and objective standards and conduct an assessment of practice since 2012, to establish a capacity to monitor the random allocation of cases in courts and provide the conditions for an impartial investigation into the allegations of high-level corruption within the Sofia City Court, and to launch an independent analysis of the prosecutor's office. These recommendations were taken up to various extents in 2016. General reform including the judicial map and e-justice Several developments have taken place in the course of 2016 in these areas, partly spurred by the reform of the JSA and partly by the maturation of projects already under way for some time within the SJC. The application of the new workload standards is being phased in and the experience gained so far is to be evaluated in spring 2017. Concerning the judicial map and e-justice, the SJC foresees a longer process, with any final decisions having to involve the next SJC to be elected in the course of 2017. The SJC has presented a project proposal under Operational Programme Good Governance (OPGG) for the development of a model to optimise the judicial map at the level of regional courts and prosecutor’s offices. The proposal will also cover the preparation of a unified information and case management system for the courts. It is also envisaged that a specialised information system for monitoring and analysis as well as a roadmap for the reform of the higher level courts will be prepared with the support of EU Funds. The reform of the judicial map will involve both the courts and the prosecutors' offices. In 2016 the Prosecutor General submitted a request to the Constitutional Court for an interpretation of a provision of the Constitution, which has so far been cited as a barrier for a separate reform of the prosecutor's offices. The Prosecutor General has explained that it is his hope that the ruling of the Court would clarify the meaning of the provision in a sense which would allow for a merger of local prosecutors' offices to move ahead independently of the reform of the local courts to which they are attached. Random allocation of cases, disciplinary proceedings, and the Sofia City Court

On random allocation of cases, the SJC reported that no major incidents have been revealed with regard to the application of the new system. An evaluation of the centralised IT system is yet to be performed. However, the ISJC regularly checks the application of the system in the courts during inspections and the reports on these checks are submitted to the SJC for consideration. On the follow-up to the Sofia City Court incidents of 2014, it does not appear that any broader investigation has been conducted into the allegations of more systematic corrupt practices within the court under the previous management. Neither has a broader inquiry into the events been carried out. The subject re-emerged in 2016 in the context of the publication of alleged recordings of a conversation between two of the implicated judges by an independent website for investigatory journalism. The SJC decided not to open an enquiry into the matter. In the meantime, criminal procedures have been launched on separate charges against the directly implicated judges, who have also been subject to disciplinary proceedings. As regards disciplinary proceedings more generally, the SJC has launched a project to develop standards ensuring clear and objective principles for disciplinary practice, as well as an analysis of the practice under the current SJC since 2012. As part of the project, it is envisaged that, once prepared, the standards will be subject to wide public consultation and training will be provided for their subsequent application. This will however have to be followed up by the future SJC to be elected in the course of 2017. Analysis of the prosecution and improvement of criminal investigations In the 2016 CVM report the Commission recommended that an independent analysis be carried out of the functioning of the Bulgarian Prosecutor's Office. The Bulgarian government requested the assistance of the Structural Reform Support Service (SRSS) , and a project involving a small team of independent and experienced prosecutors from a few other Member States was launched in spring and concluded with a final report in December 2016. The study contains an in-depth analysis of the Bulgarian Prosecutor's Office to identify possible avenues for the improvement of its structure, independence and effectiveness. This analysis touches both upon the prosecution service in a narrow sense and on the wider Bulgarian system for criminal justice more generally. It includes a range of observations and recommendations for immediate as well as more long-term action by Bulgarian authorities in both legislative and organisational areas. Most of the findings have a direct bearing on CVM benchmarks, including in particular the investigation and prosecution of high-level corruption and serious organised crime. As regards overall structures, the report identifies a need for better internal supervision of cases by management in order to ensure accountability for decisions taken, especially in high level cases of public interest. As a counterweight to this stronger involvement by the organisational hierarchy, the report recommends a number of additional mechanisms for overall accountability of the Prosecutor's Office as a whole to the public, inter alia via the creation of a specialised committee in the National Assembly, a system of external inspections covering the quality of prosecutorial decisions and involving an enhanced judicial inspectorate, and the introduction of special procedures allowing for an investigation into any allegations of possible wrongdoing by an incumbent Prosecutor-General. As for the conduct of criminal proceedings, the report gives recommendations concerning a wide range of topics, including the conduct of preliminary inquiries, the possibility of judicial review of decisions to start (or not) pre-trial proceedings or file an indictment, as well as of decisions to stop and restart cases, the role of the Prosecution in regard to non-criminal matters, training of prosecutors, and workload management. In regard to the prosecution of high-level corruption and organised crime, the report recommends that additional resources be provided for the respective prosecutors' offices both in terms of prosecutors and investigators, and that steps be taken to improve the incentive for experienced prosecutors to apply for these positions, as well as for specialised training. The low number of high-level corruption cases is noted as a matter of concern. In this regard, recommendations are made for a more proactive role in regard to suspicious transaction reports concerning politically exposed persons which are filed with the financial investigations directorate at SANS, among other measures to ensure effective financial investigations. In terms of the efficiency of proceedings, the report contains observations on the formalism of court procedures, requirements on the content of indictments, the practices in regard to returning cases to the prosecution, authorisations for the use of special investigatory means, the use of expertise in court trials and for investigations, and the proper management of court trials in complex cases (to avoid delays). Against this background, it recommends that several provisions of the criminal procedure code be reviewed and suggests that measures could be taken by the appropriate authorities (e.g. the Supreme Court of Cassation) to issue practice guidance on certain procedural issues. Independently of the SRSS project, the Prosecutor's Office also undertook a separate exercise to analyse a number of rulings of the European Court on Human Rights (ECtHR) concerning criminal investigations in Bulgaria and their possible implications for current practice. This was prompted by the identification in 2015 by the ECtHR of a 'systemic problem' in Bulgaria regarding the effective investigation of crime, based on numerous cases that had reached the Strasbourg court. The analysis covers an in-depth assessment of 54 judgements of the ECtHR concerning the lack of effective investigations in Bulgaria. The analysis reached a number of findings. First, the report concludes that Bulgarian procedural law as such is in compliance with the standards required by the case-law of the ECtHR and in this sense does not suffer legal shortcomings that would prevent prosecutors and pre-trial authorities from carrying out their work in such a way as to satisfy the requirements of the European Convention on Human Rights. Second, the deficiencies that have nevertheless been identified in the reviewed cases concern judicial bodies involved in the entire criminal procedure, including pre-trial and trial procedure. Third, the problems identified appear to have been rooted in a number of different factors of both subjective (incompetence, partiality) and objective nature (including the legal framework at the time). Fourth, a number of procedural challenges are still considered relevant under current conditions. These include, for example, the ineffectiveness and length of preliminary inquiries which delay the initiation of pre-trial proceedings, the use of inadequately substantiated decisions to terminate court proceedings and refer the case back to the prosecutor, and the insufficient access of the victim to investigation in cases where the prosecutor decides to terminate the proceedings before bringing formal charges. The report also highlights the fact that the issues raised by ECtHR rulings have been the subject of a number of follow-up actions in recent years, including training and other measures to draw the attention of prosecutors to the problems identified. Finally, the report contains a number of concrete recommendations for further action, touching upon the need for further competence-building measures within the prosecutors' offices, improved monitoring of cases to identify problems early on, proper regulation of preliminary inquiries, a possible review of the conditions for the initiation (or not) of formal pre-trial proceedings , and improving the work of the supervising prosecutor and investigating agencies. The recommendations relate to both legislative and organisational measures. Together, these two in-depth analyses carried out in the course of 2016 identify a wide range of areas for further possible measures to improve the effectiveness of Bulgarian pre-trial proceedings. 5. High-level corruption Benchmark 4: Conduct and report on professional, non-partisan investigations into allegations of high-level corruption. Report on internal inspections of public institutions and on the publication of assets of high-level officials. Corruption has been identified as a serious systemic problem in Bulgaria. This is confirmed in international rankings by international organisations and observers as well as in opinion surveys. Corruption continues to be regarded as a major obstacle to business in Bulgaria and has been estimated to have a significant economic impact on the Bulgarian economy. CVM reports have consistently pointed to the need for stronger institutions in order to respond to the problems. When discussing the response to corruption, it is important to distinguish between preventive and repressive steps. Criminal law measures should act as an ultimate deterrent against corrupt acts through effective investigation and a swift, efficient and fair follow-up whenever serious misconduct is found. However, experience makes it clear that an element just as essential is the existence of functioning preventive mechanisms, such as procedures for administrative investigation, as well as raising awareness about corruption and how to tackle it, and measures to tackle specific issues such as conflicts of interest and illicit enrichment. While an important focus should be to avoid opportunities for corruption to develop in the first place, preventive measures cannot entirely replace effective law enforcement. The two are complementary. In addition, a distinction can also be made between high-level and low-level corruption. High-level corruption is related to decision-makers with links to the political system and higher offices in the public administration and the judiciary, and involves the abuse of office or trading in influence, often involving important economic or political interests. Low-level corruption tends to concern frontline personnel in direct contact with citizens and small businesses, in sectors such as healthcare, police, or local administration. Perceived impunity for senior figures can set the wrong example for rank-and-file officials. At the time of the accession of Bulgaria to the EU in 2007, both high level and low level corruption was identified as important challenges still to be addressed in Bulgaria, which was reflected respectively in benchmarks 4 and 5. The focus of the present chapter will be on benchmark 4 concerning high-level corruption. As in previous chapters, the presentation below presents first the developments over the past ten years before focusing on the more recent developments since the last CVM report of January 2016. 5.1. Overview of developments under the CVM In 2012 the Commission noted that over the previous years, some 100-200 cases of corruption had been brought to court each year and that there were very few high-level cases among them. The overall number remains within a similar order of magnitude in more recent years. Also, the situation remains unchanged in the sense that most of the cases concern relatively minor cases. A number of investigations have been launched into high-level corruption over the years, some of which have been brought to court. However, in spite of the frequent announcement of significant charges, such cases often experience long delays and judicial appeals, and finally end up either in acquittals, or are dropped due to lack of sufficient evidence. Consequently, previous reports have consistently found that very few convictions for high-level corruption were confirmed by final court decisions. Over the past ten years, Bulgaria has carried out a number of measures as part of an overall attempt to step up the fight against high-level corruption. Some of these measures were taken in the context of a strategy for the fight against corruption and organised crime adopted in 2009 and implemented over the following years. In the law enforcement area the focus during the early years was on further specialisation and better coordination among the prosecution and investigatory agencies through the establishment of specialised units, networks and teams, methodological guidance and cooperation agreements, and additional training for prosecutors and investigators. As already mentioned above, some legislative measures were also taken to streamline criminal procedures in complex cases. In 2008 a new State Agency for National Security (SANS) was established through a merger between existing security services and the financial investigation agency and tasked with investigating high-level corruption, as well as threats to national security. SANS originally functioned as a criminal intelligence agency with powers in regard to financial investigations (incorporating the Bulgarian financial intelligence unit), but it underwent several significant reorganisations in more recent years, with the transfer from the Ministry of Interior of competences for the investigation of organised crime in 2013 and the transfer of the same competences back to the Ministry of Interior in 2015. Recurring wiretapping controversies have revealed flaws in the system for authorisation and conduct of surveillance, with significant implications for the authorities’ capacity to address corruption. The European Court of Human Rights ruled on the need for stronger guarantees against the risk of surveillance abuses.

On the preventive side, a number of institutional mechanisms are in place. Since 2000, an increasing number of high-level public officials have been required to submit personal property declarations annually, and at the beginning and end of their careers. The declarations are filed with the National Audit Office, which has the responsibility to cross-check the information with other public registers. In case of discrepancies, further checks can be carried out as the file is forwarded to the National Revenue Agency (NRA) and SANS. While the system ensures a level of transparency around assets of high-level officials, a number of weaknesses have been identified in previous Commission reports, including the fact that the National Audit Office does not have competence to carry out a more proactive investigation or identification of suspicious cases. Nevertheless, while a more proactive analysis of the property declarations could be a more effective deterrence against illicit enrichment, the systematic publication and verification of property declarations provides an important element of an effective anti-corruption set-up by ensuring transparency around the assets of high-level officials. In 2009 a law on the prevention of conflicts of interest came into force and a separate agency, the Commission for the Prevention and Ascertainment of Conflicts of Interest (CPACI), was established in 2011. This entity is competent to assess concrete cases submitted to it on alleged or potential conflicts of interest as well as to issue orders for sanctions to be imposed on transgressors, including officials who have not submitted their conflicts of interest declarations on time. However, the decisions of CPACI are subject to appeal in two instances, as are the subsequent penalty decisions, raising the prospect of each penalty issued by CPACI being subject to a total of four court rulings before becoming final. As noted by the Commission in 2012, this cumbersome decision-making process raises questions about the effectiveness of the procedure. A major challenge has been the merit-based selection of senior management for anti-corruption institutions, as most clearly evidenced by the controversial nomination to the post of Director of SANS in 2013, sparking several months' of public protests even though the nomination was swiftly withdrawn. In another example, CPACI was embroiled in a scandal in 2013 as its chairman was forced to step down amidst charges of abuse of office. He was later convicted to 3½ years in prison, although this was finally commuted on appeal to a suspended sentence. The matter has given rise to a parliamentary inquiry followed by a package of draft legislative amendments which would have streamlined procedures and improved transparency. However, these amendments, which were presented to the National Assembly in 2014, were never adopted. In spite of the controversy surrounding the resignation of its chair, CPACI has continued functioning in accordance with its original legal set-up and under an acting chair. In addition to fulfilling its mandate as an arbiter of the conflicts of interest rules in concrete cases, it has also over the recent years extended its work further into the preventive area by taking up awareness raising and training as a separate line of activity. Unfortunately, the CPACI has in the main only been able to establish conflicts of interest at the lower administrative levels. In addition to the institutions mentioned above, a network of internal inspectorates has been established within the State administration, with a General Inspectorate at the centre working under the direct authority of the Prime Minister. These agencies carry out general internal control and targeted inspections of the state administration and are also in charge of ensuring compliance with the law on conflicts of interest in the work of the respective government departments. Previous reports have noted a number of weaknesses and recommended a strengthening of the system of internal control. In spite of the weaknesses, however, the inspectorates have been recognised as making a useful overall contribution. A review of the first anti-corruption strategy was carried out in 2014-2015, which concluded that it had suffered from a lack of consistent follow-up and that further actions were needed. Consequently, a new anti-corruption strategy was adopted by the government in spring 2015 which contained a number of concrete initiatives. Among the key innovations in the new anti-corruption strategy were the creation of a specialised unit within the Prosecutor's Office to lead investigations into high-level corruption cases , amendment of the law on public administration to strengthen the independence and effectiveness of the administrative inspectorates, a proposal on sectorial anti-corruption plans to be developed in different government departments, and the establishment of an anti-corruption council and a post of Anti-corruption Coordinator at ministerial level to ensure follow-up to the strategy. The main initiative of the new anti-corruption strategy was the proposal to create a new unified Anti-Corruption Agency to ensure a coordinated and coherent approach to the checking of property and conflicts of interest of high-level officials, as well as to carry out administrative investigations into allegations of misconduct among such officials. This last proposal led to the presentation of a draft law in spring 2015, which included the legal basis for the new agency as well as a thorough reform of the rules on property declarations and conflicts of interest. According to this draft law, the new unified Anti-corruption Agency would merge several institutions, including CPACI and the part of the National Audit Office dealing with property declarations, within one single institution, while leaving responsibility for conflicts of interest for other public officials to the relevant public institutions, including the administrative inspectorates. This new draft law envisaged a major overhaul of the entire institutional landscape to deal with corruption prevention in Bulgaria. However, the proposal failed to receive the required endorsement of the National Assembly during its first reading vote in September 2015. Even though the government immediately announced its intention to resubmit the law in a revised form in order to ensure its adoption, the 2016 CVM report noted that the failure of the National Assembly to support the government's main anti-corruption initiative underlined a lack of consensus behind the reform process. The government presented a revised version in spring 2016, but has not been successful in securing its adoption. Several other elements of the national Anti-Corruption Strategy are also still outstanding. As a result, while the strategy heralded a new more comprehensive and effective response to the challenges facing Bulgaria in regard to high-level corruption, Bulgaria has so far not been able to deliver on that commitment. 5.2. Developments since the last CVM report of January 2016 In its last report the Commission recommended to Bulgaria to adopt a new anti-corruption law in line with the government's anti-corruption strategy, including the establishment of a unified anti-corruption agency with a strong independent mandate to fight high-level corruption, to adopt amendments to the law on public administration to enhance the powers and independence of the internal inspectorates, to monitor the progress of criminal cases involving allegations of high-level corruption, including the pre-trial and trial phase, and to implement measures to address the problems identified. High-level investigations by law enforcement The prosecutor's office reports that a number of high-level investigations were launched or were ongoing in 2016, a number of which have been presented at the courts. The picture remained largely unchanged from previous years regarding the limited number of convictions in high-level corruption cases. Where convictions are handed down by lower courts, past experience shows a systematic pattern of cases being overturned on appeal and ending up in acquittals or being dropped. Consequently, very few final convictions have been reported in relation to high-level corruption cases. The final report of the technical assistance project to the Prosecutor's Office coordinated by the Commission's Structural Reform Support Service also notes with concern the lack of high-level corruption cases. Regarding EU funds fraud cases, the EU anti-fraud service OLAF continues to experience an apparent lack of proactive approach to cases with a potential corruption element brought to the attention of the Bulgarian authorities. The track record on high-level corruption has therefore so far been very limited, given the apparent scale of the problem. While apparent reasons can be found in a combination of legal or procedural hurdles, an important part of the picture also seems to be a lack of capacity or motivation among investigatory and prosecutorial authorities to handle complex cases in an effective manner. According to the Bulgarian authorities, there are a number of reasons why corruption is a particularly complex crime to solve. Often corruption concerns decisions taken by collective bodies, which makes it difficult to assign responsibility for the decisions made and prove the link to any particular decision-maker. Witnesses may often be working closely with the corrupt officials, often in an inferior position, or they themselves have been involved in the scheme. Relevant documentary evidence is normally stored within the organisations with a direct interest in the case, which can lead to attempts to destroy or withhold such evidence when the existence of an investigation is revealed. Corruption schemes often concern complex decisions as a results of which external expertise is required to assess the economic benefits or damages accruing to one part or the other as a result of corrupt decisions. Such expertise may be expensive or simply unavailable in some areas. While such factors may complicate the prosecution of corruption in any country, Bulgaria faces particular challenges. For these reasons, successful corruption investigations generally require exceptional perseverance on the part of the investigatory authorities, and this again requires an environment which motivates investigators and prosecutors to pursue such cases with the necessary vigour and determination. In 2016 the Prosecutor's Office carried out an analysis of a broad sample of corruption cases processed since 2013, with a view to identifying common challenges and problematic practices to which failings in such cases could be attributed. The analysis is a follow-up to a similar analysis conducted in 2013 on similar cases over the period since the beginning of the CVM in 2007. It shows that, while some of the issues identified in the previous analysis had in the meantime been addressed through legislation or various organisational efforts, other problems remain and new additional ones have appeared which also require attention. The analysis confirms the frequent prolongation of pre-trial proceedings and provides a number of insights into problems hindering effective corruption investigations in the Bulgarian context. Problems highlighted in the study include a range of managerial issues such as cost restrictions leading to a lack of access to necessary external expertise, the complexity of high-level corruption investigations not being taken properly into account in the assessment of workload of magistrates, and a need for training in various specialised fields and joint training between prosecutors and investigators. Sometimes, supervision of investigations has not been proactive enough, resulting in late discovery of errors or delays in the investigation. There has also been a tendency in some cases to automatically grant prolongation of investigations without sufficient justification, sometimes leading to expiry of the limitation period and cases being dropped. The study recommends some organisational changes in the direction of further specialisation and better cooperation with investigatory agencies, for example through the establishment of specialised departments within appellate regions to deal with corruption cases. The establishment of the specialised anti-corruption unit in the Sofia City Prosecutor's Office is seen by the Bulgarian Prosecutor's Office as a step forward in this respect, in particular the close cooperation with SANS and the Ministry of Interior. Lack of effective cooperation between the prosecution and investigatory services appears to be a major issue in corruption investigations. A number of challenges are highlighted by the study in this regard. Often preliminary steps are taken in order to provide or confirm indications of a crime before the pre-trial stage is launched, which can jeopardise subsequent collection of evidence further on in the formal investigation. Sometimes an incorrect or overly-broad definition of the crime in the decision to open the pre-trial investigation leads to unnecessary investigatory efforts to collect irrelevant evidence. One possible result of this can be the superfi