New Crude Oil and Petroleum Products Reserves Act; Changes to Director Qualifications Requirements
13 March 2013A new Crude Oil and Petroleum Products Reserves Act (“COPPRA”) was promulgated in the State Gazette (Issue 15 of 15 February 2013) entering into effect on 15 February 2013. It revokes a previous piece of legislation: the Crude Oil and Petroleum Products Mandatory Reserves Act, which had been in effect since 2003.
COPPRA implements the requirements and provision of Council Directive 2009/119/EC imposing an obligation on Member States to maintain minimum stocks of crude oil and/or petroleum products (the “Directive”). The Directive, in its turn, reformed the prior EU law regulating energy reserves.
COPPRA aims to ensure a high level of security of oil supply in Bulgaria and ultimately is part of a broader effort for a security of energy supply in the European Community. To do so, it aims to impose reliable and transparent mechanisms in the market for crude and petroleum products, and to mandate the maintenance of minimum stocks of crude and/or petroleum products as well as putting in place procedures to deal with serious shortages. In this respect, COPPRA alters the legal position of a range of companies involved in oil and petroleum products’ production, importation and trade.
New Balkans Law Office will be very happy to advise participants in this marketplace on the overall compliance regime and on the details of the new requirements.
Effect on broader Bulgarian company law
However COPPRA’s Transitional Provisions also amend provisions of the Commerce Act concerning statutory declarations of fitness required to be made by all appointees to the managing and controlling bodies of Bulgarian limited liability and joint-stock companies.
Under the new provisions, where a natural person has been the managing director or a member of a managing or controlling body of a company (eg, its Board of Directors or Supervisory Board, where one is in place), and where the company has breached its obligations under COPPRA, and such a breach has been established by a verdict which has come into force, he or she would be disqualified from being appointed as a director or member of the managing and/or controlling bodies of a Bulgarian limited liability companies and/or joint-stock company.
In practical terms, one of the effects of this amendment is to make it necessary for natural persons proposed to be registered as directors or board members of Bulgarian companies to make an additional statutory declaration of compliance at the time of registration.
Should you require any further information or clarifications on the issues discussed above and on how they might affect the business or investment you are carrying on in Bulgaria, please do not hesitate to contact us.