BULGARIA Law and Practice Contributed by: Nikolay Zisov, Svetlina Kortenska, Deyan Terziev and Teodora Peycheva, BOYANOV & Co
or after control is gained, but before any real actions are undertaken to implement the trans- action. Any further factual or legal actions related to the intended concentration are forbidden until
under the Labour Code, typically by the transfer- or (old employer). Such consultations must start at least two months before the transfer. If there are no trade unions or employees’ representa- tives, the procedure shall be conducted with the transferring employees. The employer shall duly inform them about the following: • the transfer and its timeline; • the rationale behind the transfer; • the possible legal, economic and social impli- cations of the change for the employees; and • the measures envisaged in relation to the employees. If the transfer affects existing employees of the transferee – eg, some are about to be terminated – the transferee shall also conduct an informa- tion and consultation procedure. The procedure is rather formalistic and is usu- ally completed with one or two meetings. It can- not hinder in any way the transfer as no party to the consultations has the right to veto the transfer. Non-abidance by the consultation pro- cedure rules does not render the transfer invalid but creates an exposure for each employer to an administrative sanction amounting to up to EUR2,500. 7.7 Currency Control/Central Bank Approval No currency control and local law requirements or central bank approvals apply for an M&A transaction. Under the Currency Act there are statistical reporting requirements for opening and maintenance of accounts abroad, for direct investments abroad and for finance transactions between local and foreign residents. Statistical declarations and reporting requirements apply as well for cross-border transfers and pay- ments. However, such declaration and report-
the CRC issues a permission. 7.6 Labour Law Regulations
Labour relationships are regulated by the Bul- garian Labour Code and other relevant pieces of legislation, collective labour agreements, and internal rules, policies and orders of the employ- ers. The Labour Code sets minimum standards and most of its provisions are mandatory and may not be waived by the employee. Overall, Bulgarian labour law rules are consistent with the EU legal framework and provide for wide protection of employees. With respect to M&A transactions, it should be noted that there are cases where employment relationships are transferred automatically to the acquirer on the same contractual terms and conditions: • merger of enterprises by the formation of a new enterprise; • merger by acquisition of one enterprise by another; • distribution of the operations of one enter- prise among two or more enterprises; • passing of a self-contained part of one enter- prise to another; • change of the legal form of business organi- sation; • change of the ownership of the enterprise or of a self-contained part thereof; and • transfer of business from one enterprise to another, including transfer of tangible assets. These cases require the observance of an infor- mation and consultation procedure with the trade unions and employees’ representatives
57
CHAMBERS.COM
Powered by FlippingBook