When Will the Controversial Bill to Amend the Non-Profit Legal Entities Act Be Withdrawn?

In response to concerns raised by Bulgarian non-governmental organizations regarding the Bill to amend the Non-Profit Legal Entities Act (NPLEA), submitted by Members of Parliament from the “United Patriots” group in July of this year, Vice-President of the European Commission Věra Jourová assured that the European Commission remains firmly committed to promoting an environment in which civil society can continue to thrive.

Only two weeks after the Court of Justice of the European Union declared the Hungarian Transparency Law discriminatory, in July 2020, a Bill to amend and supplement the NPLEA was submitted to the National Assembly. The Bill proposes measures similar to the Hungarian ones:

• Creation of a Register for non-profit legal entities (NPLEs) funded from abroad, under the Ministry of Finance – all public benefit NPLEs would be required to declare any funding above BGN 1,000 within 7 days of receiving it if the funds originate from a foreign state, foreign legal or natural person, with the exception of funds from the European Union.
• Powers granted to the Minister of Finance to initiate financial inspections of NPLEs, impose property sanctions, and terminate NPLEs for failure to declare foreign funding.
• Obligation for the chairs and members of governing bodies of NPOs to declare their assets annually to the Commission for Counteracting Corruption and Illegal Assets Forfeiture (CPCIAF), if the NPLE receives foreign funding (except from the EU). Currently, such obligations only apply to individuals holding high public office.
• No such obligations are foreseen for NPLEs (or individuals in leadership roles within them) receiving public or private funding originating from Bulgaria.

The Bill unsurprisingly sparked strong negative reactions. Over 300 organizations signed a joint statement describing the proposals as “discriminatory, stigmatizing, unfounded, and disproportionate.” Internationally, the Bill was criticized in the 2020 Rule of Law Report of the European Commission, a European Parliament Resolution on the rule of law and fundamental rights in Bulgaria, and a Joint Communication from the UN Special Rapporteur on the rights to peaceful assembly and association.

In response to the concerns raised by Bulgarian NGOs, in a letter dated November 3, 2020, Vice-President of the European Commission Věra Jourová reaffirmed the Commission’s firm commitment to fostering a civil society-friendly environment.

In her letter, Věra Jourová also noted that after the publication of the Rule of Law Report on September 30, 2020, the European Commission received information from “the leader of the ruling majority in the National Assembly” that the Bill had “been discussed in a coalition council and would be withdrawn.”

Despite assurances given by the Bulgarian authorities to the European Commission, the Bill remains pending in the National Assembly. The last known “movement” on the matter was a statement from the Ministry of Justice published on October 22, 2020, in which the proposed amendments were not supported. The question remains: When will the Bill be formally withdrawn or put to a vote and rejected by parliamentary committees? Until then, its pending status continues to create uncertainty in public affairs and fuels negative rhetoric against NGOs. It is worth recalling that the Bill is based on the false claim that “current Bulgarian legislation, unlike other European countries, lacks a legal framework to ensure transparency about the sources and purposes of funding of non-profit legal entities.” In reality, Bulgarian NGOs already submit reports to various institutions, and existing transparency mechanisms are in place which, unlike those proposed in the Bill, do not explicitly discriminate against certain categories of legal entities.