Law on Credit Institutions
Article 2. (1) A bank shall be a legal person which is engaged in the business of publicly accepting deposits or other repayable funds and extending credits and other financing for its own account and at its own risk.
(2) A bank may also conduct the following activities if they are covered by its license:
1. non-cash funds transfers and other forms of non-cash payments such as letters of credit or bills for collection;
2. issuance and administration of means of payment such as electronic payment instruments, traveller’s cheques;
3. acceptance of valuables on deposit;
4. depository and custodian activities;
5. funds transfers in cases other than those under item 1;
6. financial leasing;
7. guarantee transactions;
2 Law on Credit Institutions
8. trading for its own account or for customers’ account with:
a) money market instruments – cheques, promissory notes, deposit certificates, etc.;
b) foreign currency and precious metals;
c) financial futures, options, exchange and interest-rate instruments, and other derivative instruments;
9. (amended; Darjaven Vestnik, issue 52 of 2007, in force as of 1 November 2007) trading for its own account and for customers’ account in transferable securities, underwriting issues in securities, and other services and activities under Article 5, paras. 2 and 3 of the Law on Markets in Financial Instruments;
10. financial brokerage;
11. advice on portfolio investments;
12. purchase of accounts receivable for the delivery of goods or services provided and assumption of the risk related to the collection of these claims (factoring);
13. equity acquisition and management;
14. provision of bank safes;
15. collection and distribution of information and references on customers’ creditworthiness;
16. other such activities defined in an Ordinance of the Bulgarian National Bank (BNB).
(3) (amended; Darjaven Vestnik, issue 52 of 2007, in force as of 3 July 2007) The acquisition, registration, settlement, payment and trade in government securities shall be effected pursuant to the procedure and terms of the Law on the Government Debt. Trade in government securities on regulated markets in financial instruments and multilateral trading facilities shall be effected pursuant to the procedure of the Law on Markets in Financial Instruments.
(4) A bank may not conduct in the line of business transactions other than those provided for under paras. 1 and 2, except where necessary for conducting its activities or in the process of collecting its claims on credits made. A bank may set up or acquire institutions for providing ancillary services.
(5) Accepting public deposits or other repayable funds, as well as the services as provided for in para. 2, items 1–4 shall only be carried out by:
1. a person who has been granted a bank license by the BNB;
2. a bank with a seat in a third country, which has been granted a license by the BNB
to conduct bank activities in the Republic of Bulgaria through a branch;
3. a bank authorised by the competent authorities of a Member State to carry out bank activities, which provides services on the territory of the Republic of Bulgaria either directly or via a branch.
(6) In addition to banks, еlectronic money may also be issued by electronic money institutions, which:
1. have been granted license by the BNB;
2. have been granted license by the competent authorities of a Member State, which provide services on the territory of the Republic of Bulgaria either directly or through a branch.
Article 3. (1) A financial institution is a person other than a credit institution whose principal activity is conducting one or more activities specified under Article 2, para. 2, items 5–14, as well as extending loans with funds other than accepted deposits or other repayable funds.
(2) Unless otherwise provided for by law, a permission shall not be required to carry out the activities under para. 1. Within 14 days from taking up operations, the financial institutions, which are not subject to licensing and supervision under another law, shall notify the BNB of the scope of transactions they are engaged in.
(3) The BNB may require from any of the financial institutions to provide information
on its legal status and activities.
|
