By Martin Dimitrov
Bulgarian MPs are set to meet for an extraordinary session to discuss the collapse of the country’s Company Register and the insolvency of the fourth largest insurer, just as the government steps up its bid to join the euro.
Lawmakers in Bulgaria will break off their summer recess on Tuesday for an extraordinary session to discuss the collapse of the country’s Company Register and the insolvency of the fourth largest insurer, Olympic.
The dual crises are embarrassing for the government as it seeks to further its application to join the eurozone by entering the ERM-II ‘waiting room’. Sofia is under pressure to improve banking supervision and regulation of the non-financial sector, including insurance.
The session was forced by the opposition Bulgarian Socialist Party.
With the Company Register offline, businesses in Bulgaria find themselves unable to comply with the legal requirement to make public decisions and documents regarding traders and foreign trading branches.
The files are stored in electronic form and in some cases contain personal data of individual representatives or managers. The director of the register, Zornitsa Daskalova, has resigned and the government has called for the creation of a 400,000-euro ‘digital vault’ in case of similar database collapses.
Cyprus-registered vehicle insurer Olympic, with a nine per cent share of the market, filed for insolvency last week, leaving over 200,000 people in a legal grey zone in the event of a traffic accident.
The company’s Sofia branch terminated its insurance policies on August 17 and parliament will debate whether to revoke its licence.cThe Bulgarian Financial Supervision Commission stopped Olympic from signing new policies or extending the terms of already-existing policies in May, prompted by a decision by the Cypriot finance ministry to revoke the company’s licence.
Bulgaria’s chief prosecutor, Sotir Tsatsarov, has ordered an investigation into the Financial Supervision Commission’s handling of the affair, while the government has called on Commission deputy chair Ralitsa Agayn, who is in charge of supervising the insurance sector, to resign.