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Current state of the Bulgarian registration system
 
At present official registers in Bulgaria, including those of legal persons, are predominantly decentralized and paper-based. About the only exception is the Central Pledges Register with the Ministry of Justice which was introduced in 1997 as a central, electronic register for security interests in non-real estate assets (except for ships and aircrafts).*

Unfortunately, this is not the case with other official registers which are also of great structural importance for the economy. Legal persons (commercial entities and not-for-profit organizations with the exception of political parties) are registered by the 28 District Courts in Bulgaria, that is, in separate registers throughout the country. The legislation regulations clearly follow the distinction between the activity of the court within the protecting procedure for making entries and the administrative maintenance of the register. In spite of this, the registers are actually made equal to the companies’ files which contain the evidence and the statements of the court for permitting the entry: all the inquiries, company searches and certifications are made on the grounds of the company file, and when it is missing entirely or particular documents of it are not available, entries, inquiries and certifications are not actually made. Thus, a regular inquiry about the representation of a certain legal person preceding contract conclusion might require a distance of a few hundred kilometers to be covered to hand over a written application, followed by a week’s interval and a further delay for information delivery; ultimately, the result is likely to be imprecise and unreliable. As information accumulates, it becomes increasingly hard to access and its usage – progressively slower and even impracticable. Obviously, this result is unfeasible in the present dynamic business environment. Economic reality shows that all kinds of contracts are largely being concluded on the basis of registered information on the legal status of legal persons that is already months old; this means that people cannot gain from safety which is the main objective of the registers’ existence or, vice versa, they risk becoming “victims” of the presumption of knowledge of filed circumstances or absence of unfiled ones since they are virtually unable to check the facts.

The case with real estate is similar. Property registers are kept by the 112 Regional Courts and the registers are still paper-based although experimental attempts have been made to introduce computer-based information systems at various Courts, which do not have legally binding effect. It is certainly problematic in terms of legal security that there are no public registers of state-owned real estate, municipally-owned real estate, as well as a great number of formerly state-owned or municipally-owned real estate, which have been incorporated in the property of private legal persons. Often, all the evidence concerning ownership of an estate exists simultaneously with a state or municipal property act whose existence couldn’t have been checked up and which refutes all other evidence.

Pursuant to the currently operative Law on the Cadastre and the Property Register, the Civil Procedure Code and the Registration Rules, a Central Cadastre and a Property Register (incorporating data from the cadastre), both paper- and computer-based, are being set up. The 112 registration offices at the Regional Courts conduct entries and registration of acts (concerning real estate ownership) solely on paper.

Council of Ministers Decision No. 326 of 11.05.2001 stipulates the adoption of a long-range program concerning the activities for establishing the cadastre and the property register. Its implementation is coordinated and supervised by an interdepartmental group and is in an advanced phase. A Draft Law on Amendments to the Law on the Cadastre and the Property Register is to be completed by the end of the year. The Cadastre will be electronic, but will be kept in printed format as well. The Property Register will be entirely electronic and will be maintained by a Cadastre Agency with the Ministry of Regional Development and Public Works and a Property Registration Agency with the Ministry of Justice. Centralization of the property register and its maintenance in electronic form will allow collaborative accomplishment of the electronic registers of legal persons and the existing Central Pledges Register and its linkage with them as well as their subsequent merger into an Electronic Registries Center.

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* Although distance registration or information issuance from the Central Pledges Register is not yet practically applied, filing is actually performed within an hour at most from the moment the applicant enters the registration office. Comprehensive data on the pledges included in a particular person’s record is supplied within the same time frame. Filing to record or certificate issuing is practically identical in Sofia and, for instance, Varna, due to the local registration offices operating at the premises of seven District Courts. The Law on Electronic Document and Electronic Signature (effective since October 7, 2001) would enable the Central Pledges Register to make entries based on electronic applications as well as issue certificates in electronic format via the Internet. This would shorten the procedure substantially and render the applicant’s location insignificant. The advantages of such a mode of registration and access to the register in terms of speed, safety, and low cost, are apparent.
 
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