Financial Crime World

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Bulgaria Faces EU Action Over Financial Fraud and Environmental Concerns

The European Commission has launched two new infringement proceedings against Bulgaria, citing the country’s failure to implement effective measures against financial fraud and environmental pollution.

Financial Fraud

In one case, the commission is accusing Bulgaria of incorrectly transposing EU rules aimed at preventing money laundering, specifically Directive 2018/843. According to the EC, Bulgaria:

  • Has failed to register, license, or regulate service providers
  • Lacks a mechanism to resolve discrepancies in information provided by its national beneficial ownership register
  • Has not properly applied concepts such as “establishment” and “residence” when it comes to determining who is required to provide information on beneficial ownership

Environmental Concerns

In another case, Bulgaria has been accused of not correctly transposing EU rules aimed at combating fraud affecting the Union’s financial interests, outlined in Directive 2017/1371. The EC says that it has identified several conformity issues regarding:

  • Definition of certain criminal offenses and related penalties
  • Liability of legal persons for crimes committed on their behalf

Timeline

The commission has given Bulgaria two months to respond to these allegations. If Bulgaria fails to comply with the EC’s demands, the cases could be brought before the Court of Justice of the European Union.

Additional Cases

In addition to these new cases, the commission is also escalating its existing proceedings against Bulgaria over its failure to:

  • Remove barriers to access to justice in relation to air quality plans under the Air Quality Directive
  • Comply with EU rules on marine equipment, outlined in Directive 2014/90/EU

Next Steps

Bulgaria now has two months to respond to the commission’s reasoned opinions. If necessary, the cases could be brought before the Court of Justice of the European Union.

Note: I used headings (#) for main sections and subheadings (##), and bullet points (*) for listing the EC’s concerns. I also kept the original text as much as possible to ensure that it remains readable and understandable.