Bulgaria

Government Measure

As a measure aimed at preserving jobs in sectors affected by the COVID-19 pandemic, the National Social Security Institute will reimburse employers for 60 per cent of the amount of the income (for social security purposes) and social security contributions due on that income for employees based on both the respective amounts in the month of January 2020.

Employers benefiting from this measure are required to pay the entire monthly remuneration to the respective employees, otherwise they would have to reimburse the received amount.

This measure is available for companies active in all sectors that have reported losses in the amount of 20 per cent in the month preceding the month of the submission of the claim for payment of compensation. The reported losses will be compared to previous months.

Companies that wish to benefit from this measure should file a compensation claim with the Employment Agency together with a statement on the reduced working hours, discontinuance of work operation or the suffered loss of income. The compensation claim is reviewed by the competent decision-making committee. Where the eligibility requirements are met, the company will receive the compensation.

Eligibility

This measure is open for companies in Bulgaria with discontinued work operations or reduced working hours due to the state of emergency and related measures.

The relief is available for companies active in the following economic sectors:

• Retail;
• Transport (land, passenger , and air);
• Hotels and leisure (restaurants, bars, pubs, cinemas, etc.);
• Tourism;
• Arts;
• Pre-school and school; and
• Sport.

Further guidance about the scheme and application forms are available here (in Bulgarian only).This measure is available also for companies active in all sectors that have reported loss in the amount of 20 per cent in the month preceding the month of the submission of the claim for payment of compensation compared to previous months

Supervising Authority

Bulgarian National Social Security Institute and Bulgarian Employment Agency Further guidance about the scheme and application forms are available here (in Bulgarian only).

Availability

For a duration from 13 March 2020 until 30 June 2020.

This may be extended as necessary

Government Measure

The special legislation adopted in relation to COVID-19 and the state of emergency in Bulgaria allows municipal councils to adopt decisions for the reduction of or exemption from rent for municipal properties rented by affected persons and entities. Certain municipalities, including Sofia, Plovdiv, Burgas and others, have already approved such reductions or exemptions for properties, other than residential premises for two months after the lifting of the state of emergency (lifted on 14 May.2020).

In addition, some municipalities have also waived certain fees (e.g. local fees for municipal waste and for the use of sidewalks, squares and street lanes among other fees) payable in relation to municipal properties rented by affected persons and entities.

Note: A similar program may be available also for state-owned property rented to individuals or legal entities affected by the COVID-19 pandemic but for the time being no such relief has been provided.

Eligibility

Individuals or legal entities who have reduced or discontinued their business activity due to the COVID-19 measures imposed by the government.

Some municipalities have limited the eligibility only to persons or entities whose business activity was directly and explicitly suspended by the laws, regulations and administrative acts adopted in relation to COVID-19. Other municipalities have provided the relief to a wider group of affected persons and entities.

This application occurs with automatic effect with no applications required.

Supervising Authority

Respective municipalities

Availability

Starting date depends on the date specified in the respective municipal decision.

Generally, such relief is available during and until the state of emergency in Bulgaria is lifted. The said relief has been adopted on 9 April 2020 by the Act on the Measures and Activities during the Emergency state as a general possibility for all municipal councils to approve local relief. In compliance with this provision some of the municipal councils (Sofia, Plovdiv, Burgas) have already adopted such decisions. Thus, the relief is in place for the cities, where the municipality councils have adopted respective decisions.

Government Measure

During the state of emergency and two months after its lifting, no default interest and penalties will be due on late payments under credit agreements and other forms of financing (factoring, forfeiting, etc.) provided by banks and financial institutions, even if these have been transferred/syndicated to another bank or financial institution.

The suspension applies also to an acceleration, rescission of contracts and expropriation of assets due to payment default under such financing agreements.

Eligibility

All private legal persons and entities that are debtors under credit agreements and other forms of financing (factoring, forfeiting, etc.) provided by banks and financial institutions.

This relief occurs with automatic effect with no applications required.

Availability

Starting from 13 March 2020 until the state of emergency in Bulgaria is lifted.

Government Measure

The Association of banks in Bulgaria has approved a common framework for deferral and settlement of obligations of borrowers affected by the COVID-19 pandemic under loan agreements with commercial banks in Bulgaria.

Three standardized mechanisms are envisaged: (i) deferral of principal and interest for up to 6 months; (ii) deferral of principal only for up to 6 months; and (iii) mechanism applicable to revolving products. The respective mechanism is agreed between the bank and the client.

Where the private moratoria standardized framework is applied to a financing agreement, it will not be treated as a non-performing loan for regulatory purposes by the Bulgarian National Bank.

Payments due may be deferred for a period of up to 6 months but not later than 31 December 2020

Eligibility

The framework is available to all borrowers (individuals and legal entities), other than credit institutions, who expect or already experience difficulties with servicing their loan obligations.

The framework applies to all bank loans that have closed before 31 March 2020, regardless of their type, size, purpose and established collaterals.

The deferred payments must have been regularly serviced or with a payment default of no more than 90 days as of 1 March 2020.

An application must be made by the borrower to the lender whereas each lender may specify the documents and information that they may require.

Supervising Authority

Respective commercial banks acting as lenders have agreed to apply the framework proposed by the association of banks in Bulgaria. The framework was prepared in compliance with the guidelines of the Bulgarian National Bank and the European Banking Authority - and is partly self-regulated by the commercial banks.

Availability

The framework was approved on 10 April 2020.

Applications should be made not later than 22 June 2020.

Government Measure

The government has provided a support measure under Operational Program "Innovation and Competitiveness" 2014-2020 for provision of gratuitous financial support to micro and small enterprises for the purpose of overcoming the economic consequences of the COVID-19 pandemic.

The aim of the measure is to provide operational capital to the targeted enterprises.

The targeted companies shall submit project proposals under Priority programme "Entrepreneurship and SME Growth Capacity".

The minimum amount of the requested grant for a project is BGN 3k (approx. €1.5k), and the maximum amount is BGN 10k (approx. €5k).

The grant procedure is implemented with the financial support of the European Union through the European Regional Development Fund. The total amount of the grant under the procedure is BGN 173m (approx. €86m).

Eligibility

Small and micro enterprises of all sectors may apply with projects involving activities needed to address the lack of funds or lack of liquidity resulting from the COVID-19 epidemic, including for the following types of expenses:

• Costs for the purchase of raw materials and consumables;
• Expenses for external services;
• Staff costs (including remuneration costs and costs for social security and health contributions at the expense of the employer).

Supervising Authority

General Directorate "European Funds for Competitiveness" at the Ministry of Economy in its capacity as Managing Body of the Operational Program "Innovation and Competitiveness" 2014-2020

Availability

The program will be available as of 14 May 2020 until 15 June 2020.