Transfers and Payments from Foreign Countries to this Country and from this Country to Foreign Countries

Legal Regulation:
CURRENCY ACT - CA or (Foreign Exchange Law) - Art. 2 , Art. 6 and Art. 7
Ordinance No. 28 on Information Collected by Banks about Crossborder Transfers and Payments (Ordinance No. 28)
Ordinance No. 27 on the Balance of Payments Statistics - Art. 2 through 5
CRIMIAL CODE - Art. 250 and 251

The Concepts of Resident and Nonresident
A. A resident within the meaning of the Currency Act (CA), Additional Provisions, § 1, item 2, is:
- a natural person having permanent residence in this country, which means residence in the country with a right to indefinite term. The natural persons shall establish the availability or absence of permanent residence in the country within the meaning of this Act through a declaration in conformity with a declaration per sample form (Annex No 1 to Ordinance No 27) - § 1, item 3d of the Currency Act ;
- a legal person having its seat in this country. A merchant's seat shall be the community where its registered office is located - Art. 12 . Traders, branches of foreign traders and circumstances related thereto, for which there are provisions of a law that they are liable to be entered, shall be entered in the Commercial Register - Art. 4 of the Commercial Register Act .
Any relocation of a merchant's registered office to another community shall be declared for entry into the commercial register - Art. 14 of the Commerce Act ;
- a legal person having its seat outside of this country - for its operations in this country through a registered branch. A branch of a foreign person registered with the right to engage in commercial activity in accordance with its national law shall be registered in the commercial register - Art. 17a, para 1 of the Commerce Act ;
- the Bulgarian diplomatic, consular, trade and other representation offices, their personnel and the servicing them Bulgarian citizens, who reside abroad on a mission of the Bulgarian state, the long-term commissioned abroad military officials on regular military duty and civil persons by the Ministry of Defense in missions, headquarters and authorities of international organizations, as well as the members of their families;
- the Bulgarian citizens, residing abroad aimed at education or aimed at medical treatment regardless of the term of residence;
B. A foreign person shall be each natural or legal person, who does not meet the above indicated conditions for local person (resident) - § 1, item 3 of the Additional Provisions of the Currency Act.
Foreign persons shall always be:
- the foreign diplomatic, consular, trade and other representation offices, the international organizations, the members of these representation offices and organizations, their personnel and the servicing them foreign citizens and the members of their families;
- persons, residing in the Republic of Bulgaria aimed at training or medical treatment, regardless of the term of residence.

Registers with the Commercial Banks and BNB
For the needs of the statistics of the payment balance registers are kept by the commercial banks and BNB for all the transfers and payments between local and foreign persons in the country and for the trans-border transfers and payments (from foreign countries to this country and from this country to foreign countries) at a value equal to and exceeding 5 000 BGN or their equivalence in foreign currency - Art. 7, para 1 of the Currency Act . The commercial banks present to BNB the gathered information on a monthly basis, within time limit up to the 15th of the month following the month under report - Art. 2, para 1, item 1 and Art. 5 of Ordinance No 27.
The gathered information is used by BNB for statistic purposes solely. BNB may publish and present to other persons and institutions solely generalized data, which do not allow the identification of the persons who provided for the statistic information - Art. 7, para 10 of the Currency Act and Art. 14 of Ordinance No 27.

Payment and Foreign Exchange Transfers from Foreign Countries to this Country
In event of proceeds from abroad the commercial banks shall be obligated promptly to notify their clients about the proceeds of amounts in their accounts - Art. 4, para 1, item 3 of Ordinance No 27.
Payments and transfers from abroad at the value of up to 25 000 BGN shall be freely received from the commercial banks without the presentation of supplementary documents.
In events of payments and transfers from other countries at a value of and exceeding 25 000 BGN the recipient of the transfer shall be obligated within a 30-day time limit from the receipt of a notification from the commercial bank about the receipt of the transfer to present before the commercial bank - intermediary for the payment a statistic form in conformity with a sample form (Annex No 2 to Ordinance No 27) - Art. 7, para 4 of the Currency Act and Art. 3, para 2, item 2 of Ordinance No 27. The commercial bank may request the recipient of the payment to fill in a declaration in conformity with a sample form as well (Annex No 1 to Ordinance No 27) for availability or absence of permanent residence in the country aimed at determination of its capacity of a local or foreign person (resident or nonresident) - Art. 2, para 2 of Ordinance No 27.

 Transfers and payments to other countries at a value adding up to 5000 BGN
The local and foreign persons shall freely effect such transfers through the commercial banks - Art. 2, Art. 1 and Art. 7, para 1, item 1 of the Currency Act .

Transfers and payments to other countries at a value of up to 25 000 BGN
The local and foreign persons (residents and nonresidents) shall freely effect transfers and payment in other countries at a value of up to 25 000 BGN, after which they shall present to the commercial bank - intermediary a statistic form in conformity with a sample form (Annex No 2 with Ordinance No 27). The statistic form shall be presented at the time of the ordering of the payment. The commercial banks shall effect the transfer or the payment to other countries solely after the receipt of the information contained in the statistical form - Art. 3 of Ordinance No 27.
During effecting a transfer or a payment between a resident and nonresident in the country the commercial banks shall perform the operation solely after receipt of a filled in by the person ordering the transfer or the payment statistical form in conformity with a sample form (Annex No 2 to Ordinance No 27) - Art. 4, para 1 of Ordinance No 27.
Residents and nonresidents freely effect such transfers having filed a declaration as per BNB sample form specifying the amount, reasons for, and the currency of the transfer - RCIBPS, Art. 3. The declaration is filled in by the client at the moment of ordering the payment - RCIBPS, Art. 4, para 1. The commercial bank intermediating to the transaction effects the payment to a foreign country only after the receipt of the declaration filled in according to the requirements - RCIBPS, Art. 5, para 1.

Transfers and Payments to Other Countries at the value of over 25 000 BGN by Residents
A resident who wishes to effect a foreign exchange transfer or payment exceeding the
equivalent of BGN 20,000 to a foreign country, submits to the servicing banks the respective
documents certifying the grounds for and amount of the payment, in accordance with Ordinance
No. 28, Art. 3, para 1. The documents are submitted to the bank in the respective foreign
language, with a translation in Bulgarian at request - Art. 4 of Ordinance No 28.

Required Documents
Depending on the transaction type, in cases of foreign exchange transfers to foreign countries exceeding BGN 25,000 ordered by a resident, the following documents should be submitted to the servicing bank, before the transaction is effected:
- exports of goods and services - the documents to be submitted are a contract, an invoice, a customs declaration or another document providing information concerning the initial registration of these business operations, where the payment obligation is ascertained;
- transport, loading, insurance, warehouse and other expenses in relation to the transit of goods and passengers, made by nonresidents - the documents to be presented are a contract, an invoice or another document certifying the grounds for payment;
- agreed advance payment for the transactions under the preceding two items – the documents to be presented are a contract, a proforma invoice or another document containing information about the initial registration of these business operations;
- re-export payments by principals or intermediaries, where the goods do not enter the country - a document certifying the receipt of a payment from abroad in favour of the person ordering the transfer should be submitted, if not otherwise provided for in the contract;
- payment in accordance with a decision of local judiciary body in favour of nonresidents - the decision already in effect should be submitted;
- payments by insurance and reinsurance companies under insurance and reinsurance contracts, the respective contract or document certifying the occurrence of an insurance event should be submitted;
- for education and training abroad - the document certifying educational status in the respective school year and stay in relation to training abroad should be submitted;
- advance payment of visa fees - a document issued by the Ministry of Foreign Affairs of the respective countries having no diplomatic and consular representations in this country, or a document issued by a diplomatic or consular representation in this country should be submitted;
- for medical examinations and treatment abroad and related costs thereof - an epicrisis from a medical institution should be submitted;
- for financial support of diplomatic and consular representations of the Republic of Bulgaria, as well as of other agencies of ministries or other departments abroad - an Accounting Budget of the administrative and business expenses by the respective ministry or other department should be submitted;
- for administrative and business expenses of natural and legal persons abroad – a Resolution on opening and registration of an overseas representation, as well as an Accounting Budget for the expenses for the respective year should be submitted;
- for commissions, charges and advertisement fees, participation in fairs and exhibitions abroad - a contract or another document certifying the payment obligation should be submitted;
- bank commissions and charges on transactions effected by domestic banks for their clients' account - a document certifying the payment obligation of the domestic bank under its clients' transactions should be submitted;
- payment membership fees to international organisations - a document issued by the respective international organisation should be submitted;
- participation in international competitions, festivals, symposia, conferences, work camps, etc. - a document issued by foreign organiser should be submitted;
- for tourist expenses of resident natural persons - a document certifying traveling abroad should be submitted;
- for subscription fees for overseas publications - a document certifying the amount of the fee, including the one specified in the publication, should be submitted;
- consultancy and legal services abroad - a document certifying the price of the services should be submitted;
- payment of pensions abroad - a document certifying the pension legality should be submitted;
- for financial support of spouses, descendants, ascendants, bothers and sisters abroad - a declaration of family relatedness and a document certifying the stay abroad of the person in whose favour the foreign exchange is being transferred abroad;
- for the establishment or acquisition of an enterprise abroad, assumption of rights of a unlimited liability partner or acquisition of equity giving right to more than 20 per cent of the votes in the General Meeting - a memorandum of association, an agreement, or another document certifying the establishment or acquisition of the direct investment;
- for transfers and payments related to the acquisition of securities - against presentation of documents, certifying the acquisition of the securities;
- for granting a loan in relation to a direct investment in other countries or related to an agreement for participation in an allocation of the profit - against a Contract or another document, certifying the granting of the loan and a relevant agreement for participation in the profit and if the resident is a legal person or sole proprietor - also against a document certifying the declaring before the BNB of the loan and the initial effecting of the direct investment (see the relevant procedure);
- for additional investment to already effected direct investment - against a document certifying the declaring in BNB of the initial effecting of the direct investment, if the resident is a legal person or sole proprietor (see the relevant procedure);
- for acquisition of real estate - a document certifying the need for payment should be submitted;
Note: The above list of transactions and documents is not exhaustive. In cases outside the above listed, the person who wishes to effect a transfer or payment should present a document certifying the need of a payment to a foreign country in pursuance with Ordinance No. 28, Art. 3, para 3.

Transfers and Payments Transfers and Payments to Other Countries at the Value of over BGN 25,000 by Nonresidents
A nonresident who wishes to effect an overseas foreign exchange transfer or payment exceeding the BGN equivalence of 25 000, should submit to the servicing bank the following documents as per Ordinance No. 28, Art. 3, para 2:
- for transfer of income from foreign investments in the country - it is necessary to present documents certifying the investment and the payment of the taxes due in the country.
A foreign investment, within the meaning of Art. 12 of the Investment Promotion Act is any investment or increasing in the amount of the investment by a nonresident or a branch thereof in:
- stocks or shares of commercial companies;
- title on buildings and limited right in rem on real estate;
- title and limited right in rem on movable property constituted as tangible fixed assets;
- title on an enterprise, and separate parts of such, in accordance with the Transformation and Privatisation of State-owned and Municipal Enterprises Act;
- securities, including bonds and treasury bills, as well as any derivatives of such instruments, issued by the government, municipalities, or other Bulgarian legal persons with a residual term to maturity not less than 6 months;
- loans, including in the form of financial leasing, extended for a term not less than 12 months;
- intellectual property rights - objects of copy right and neighboring rights, patentable inventions, utility models, trade marks, service marks, and industrial design;
- rights under concession agreements and management agreements;
- receipt of liquidation quota during the termination of the investment;
- price during the sale of the subject of the investment;
- the amount received during compulsory execution.
- indemnification during expropriation of the subject of the investment for state needs.
- for a foreign exchange transfer abroad not exceeding in amount the foreign exchange imported in this country via bank - a certified copy of the document for the receipt of the transfer should be presented to the back payment order for the transfer;
- for transfer of foreign exchange abroad by nonresident natural persons to foreign countries acquired from disposition of own real estate - a copy of the title deed (as well as the original document for verification) - a title deed, entered voluntary partition contract, entered court ruling or a decision of a state or private executive magistrate for striking off a property at an auction should be submitted;
- for transfer by nonresidents of foreign exchange acquired from a legator's deposit – an inheritance certificate and a statement of the legator's account should be presented;
Note: The above listing of documents as grounds for effecting a transfer or payment to a foreign county by nonresidents is not exhaustive In cases not covered by the above list, a transfer or payment to a foreign country may be effected upon submittal by the nonresident of a document certifying the need for a payment to a foreign country, as per Ordinance No. 28, Art. 3, para 3.

Transfers and Payments to Other Countries in Relation to Financial Credits
Financial credit shall be provision of monetary funds with liability for refunding, which is not a trade credit. Forms of financial credit shall be:
- financial leasing, assumption in debt and assignment of receivables pertaining to financial credits - § 1, item 9 of the Additional Provisions of the Currency Act ;
- opening of a bank account abroad - Art. 6, para 1, item 2 and Art. 4, para 1, item 2 of Ordinance No 27. When the resident legal person or sole proprietor effects a transfer or a payment to foreign countries in relation to a financial credit already provided by or to a nonresident, inclusive through opening of a bank account in another country, a declaration certified by BNB certifying the declaring of the financial credit should be presented before the commercial bank - Art. 3, para 4 of Ordinance No 28 (see the relevant procedure).
with over 50 Per Cent State Participating Interest
When an enterprise or a company with over 50 per cent state participating interest effects a transfer or payment to other countries, which is not subject to statistic declaring before BNB (see the relevant procedure), a document for coordination with the competent authority, which exercises the right of ownership of the state in the relevant legal person shall be attached to the payment order as well - Art. 3, para 5 of Ordinance No 28.

Penalties

A. Administrative Liability
Commercial banks and their employees are held administratively and criminally liable if they effect a foreign exchange transfer to a foreign country without having the documents, declarations, etc., required under the Currency Act, presented to them. Natural and legal persons who place an order to a commercial bank for a transfer in violation of CA are not held administratively liable, as it is an obligation of banks and their employees to check about the legality of a transfer prior to effecting it. Commercial banks and their employees should refuse to effect a transfer until all the documents required for the transfer as provided for in the CA and the regulations on its application have been provided to them - Art. 7, para 3 of the Currency Act .
A commercial bank, which violates the provisions of the Currency Act and of the statutory instruments relating to its application during the execution of transactions and acts with foreign exchange, shall be punished with a property sanction adding up to from 5000 to 25 000 BGN. In event of repeated violation the commercial bank shall be punished with a property sanction from 10 000 to 50 000 BGN - Art. 19, para 5 and 7 of the Currency Act .
An official from a commercial bank, who violates or admits violation of the requirements of the Currency Act and of the statutory instruments relating to its application, shall be punished with a fine from 500 to 2500 BGN, if the deed does not constitute a crime. In event of repeated violation the official shall be punished with a fine from 1000 to 5000 BGN - Art. 19, para 6 and 7 of the Currency Act .
The reports ascertaining violations are made by officials authorised by the BNB Governor, and the penalty orders are issued by the BNB Governor or by an official authorised by the Governor - CA, Art. 19, para 8 . The drawing up of the reports, the issuance, the appeal and the execution of the penalty orders shall be carried out in accordance with the procedure established by the Administrative Violations and Sanctions Act - Art. 20 of the Currency Act .

B. Seizure in Favor of the State
The subject of the violation shall be seized in favor of the state, inclusive of events when the violator may not be established - Art. 20 of the Currency Act .

C. Criminal Liability
A person who transfers amounts abroad through a bank, using a false, forged document or a document with untrue contents, shall be punished by deprivation of liberty for one to ten years and by a fine equal to the double amount of the transfer - Criminal Code, Art. 250 .
Any person that violates a provision of a law, of an act of the Council of Ministers, or of the Bulgarian National Bank in relation to the regime of transactions, import, export or any other activities, involving foreign exchange valuables or obligations for their declaration, and if the corpus delicti involves a particularly large amount, is punished by imprisonment of up to six years and a fine up to twice the amount of the corpus delicti. The corpus delicti is seized in favour of the state, and where it is missing, or it has been alienated, its equivalent value is awarded - Criminal Code, Art. 251.