Nina Boteva Law Office Newsletter

The Anti-Money Laundering Measures Act (AMLMA) was amended in January 2021. This Law determines the measures for prevention of the use of the financial system for the purposes of money laundering, as well as the organization and control over their implementation. The circle of the subjects, which are obliged to apply AMLMA in their activity, are set out in Art. 4 of the Law. The latest amendment to the AMLMA removed “wholesalers” from the list of subjects stipulated in Art. 4 of the Law. The arguments for this legislative decision are related to the fact that the introduction of an obligation to the “wholesalers” in respect of the apply the AMLMA – puts Bulgarian traders at a disadvantage in comparison to their competitors in other European countries. The legislative change is based on the fact that Directive (EU) 2015/849 of the European Parliament and of the Council of 20 May 2015 on the prevention of the use of the financial system for the purpose of money laundering and terrorist financing does not explicitly mention wholesalers among the obligated entities, and the above-mentioned Directive only points out the criteria in respect to the traders who should apply the relevant measures in case the transaction or operation is over EUR 10,000.

The changes in the AMLMA are related on the other hand to the fact that the Law does not contain a definition of the term “wholesalers”. Moreover, in the AMLMA there is no differentiation in connection to individual types of traders or high-risk sectors/industries, nor the type or amount of payments made or received. All these circumstances create significant and unjustified difficulties for wholesalers in relation to the application of the AMLMA.

As a result of the above considerations, it appears that the Bulgarian “wholesalers” face obstacles in carrying out their activities. At the same time, Bulgarian wholesalers are disadvantaged and uncompetitive compared to wholesalers in other EU Member States and third countries, which are not obliged to carry out a comprehensive inspection and to request and collect documents, data and information from its clients in connection with measures against money laundering and terrorist financing.

Contributing Advisors