Fund Manager of Financial Instruments in Bulgaria EAD

Order No 3 of 22 July 2015 of the Council of Ministers sets up a sole-owner joint-stock company with government interest called Fund Manager of Financial Instruments in Bulgaria EAD. The company has a two-tier system of management, i.e. a supervisory board and managing board, and the subject of its activity is the management of financial instruments to be implemented under the programmes co-financed by the European Regional Development Fund, the European Social Fund and the Cohesion Fund, the European Agricultural Fund for Rural Development and the European Maritime and Fisheries Fund in the 2014-2020 programming period.

Fund Manager of Financial Instruments in Bulgaria EAD will be responsible for the implementation of the financial instruments which, together with the other forms of support as envisaged in Regulation (EU) No 1303/2013 of the European Parliament and of the Council of 17 December 2013, are part of the support rendered to Bulgaria from the European Structural and Investment Funds (ESIF) through the operational programmes. The set-up company, Fund Manager, should meet the requirements of good corporate governance, should take steps to reduce the risk of political influence on the operational decisions and should prove the professional experience and expertise of its staff in the management of financial instruments.

The registration of the Company and its entry into the Company Register has been a fact since 15 October 2015. In line with Order No 3, a supervisory board with 7 members representing the ministries responsible for coordination, implementation and management of financial instruments has been appointed. Meeting the specific requirements of Article 7(2) of Delegated Regulation No 480/2014 for having appropriate professional qualification, expertise and experience in the management of financial instruments and observing the provisions of national legislation, the Supervisory Board elected a Managing Board with three members - Valery Beltchev, Ivan Dakov and Martin Danovsky. They have long professional experience in the financial industry, including the design and implementation of financial products; they have profound expertise and good knowledge of the corporate market and SMEs; they also have experience in the management of international companies as well as in the management and implementation of projects funded by the European Structural Funds.

To ensure that the European requirements have been observed, negotiations were held with the European Investment Bank (EIB), the International Bank for Reconstruction and Development (IBRD) and the European Bank for Reconstruction and Development (EBRD) for technical assistance which is to ensure the professional and effective management of ESIF funds and the use of the possibilities of the financial instruments for multiplying public resources through mobilising private ones. As a result of these negotiations and implementing the general Memoranda of Understanding with the three international financial institutions as approved and signed by the Government, agreements for technical assistance have been signed in connection to the setting up of a Fund of Funds and of a Manager of the Fund of Funds to be financed under the Technical Assistance Operational Programme, with a period of implementation until 31 December 2015. The expertise of EIB, IBRD and EBRD is needed by our country and is planned to be used over the period of implementation of the financial instruments in Bulgaria.

The expertise of the said institutions will help elaborate the system of management and control of the Fund Manager which will include preparation of all documents required for the operation of the Company, its investment strategy will be devised, as well as draft financing agreements between the Managing Authorities and the Fund Manager will be prepared under the 4 operational programmes whereunder implementation of financial instruments is planned.