Bulgarian Banking Requirements for Civil Society Organizations

Opening a Bank Account: A Brief Overview

In Bulgaria, opening a bank account for civil society organizations (CSOs) can be a complex process due to local practices and regulations. Bulgarian banks are less inclined to open accounts for companies with no legal representatives residing in the country. This is because it assumes that the representative will be available for personal meetings and necessary documents can be signed locally.

Authorized Individuals and Online Opening of Bank Accounts

For CSOs with foreign capital or foreign entities, a bank account can be opened by either:

• The entity’s legal representative, or
• A proxy under a notarized power of attorney from the legal representative of the entity

In cases involving individuals, this can be done personally or through a proxy under a notarized power of attorney. Online opening of bank accounts is not a standard practice in Bulgaria.

Ongoing Monitoring and Reporting Obligations

Bulgarian credit institutions are required to conduct ongoing monitoring of transactions and operations carried out by CSOs throughout the course of their customer relationship. This includes verifying transactions and assessing whether they are consistent with the risk profile of the relevant customer.

Additionally, credit institutions must report any suspicion of money laundering or involvement of criminal activity proceeds, regardless of the value of the operation or transaction, to the State Agency for National Security (SANS). The agency has ultimate discretion on the next steps in such cases, and reports are typically made by simultaneously blocking pending transactions from the respective account.

Data Protection and Bank Secrecy

Bulgarian credit institutions must protect clients’ information, which includes data on balances and operations on accounts and deposits held by clients. This information is strictly confidential and can only be revealed to third parties (law enforcement and governmental agencies, as well as judicial bodies) in limited circumstances and in accordance with procedural requirements.

Credit institutions are also subject to the obligations under the EU General Data Protection Regulation (GDPR) and are responsible for collecting and processing clients’ personal data in relation to compliance with GDPR rules.

No Specific Reporting Obligations

There are no specific reporting obligations for banks to inform governments on CSO banking in certain circumstances.

Changes Due to Russian Sanctions

There have been no changes to local banking legislation in connection with Russian sanctions. Bulgarian credit institutions/financial institutions as EU credit institutions/financial institutions are subject to the EU regulations imposing sanctions against Russia.

Conclusion

By understanding these requirements and obligations, civil society organizations can navigate the complexities of banking in Bulgaria more effectively and ensure compliance with relevant regulations.

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Note: The article has been rewritten to resemble a media article. Any specific details or data mentioned in the original text have not been altered.