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Jan 19, 2021

The Supreme Administrative Court refused to abolish the tariff of private bailiffs, which regulates the proportional fees for the execution of a pecuniary claim

in Без категория

Our partner Nikolay Lazarov once again successfully defended the interests of the Bulgarian Chamber of Private Bailiffs before the Supreme Administrative Court. On 11th January 2021, a five-member panel of the Supreme Administrative Court of the Republic of Bulgaria ruled in an administrative case No. 8152/2020, refusing to cancel part of the tariff of the private bailiffs, which determines the enforcement fees for pecuniary claims. The proceedings were initiated on cassation appeals filed by the Council of Ministers of the Republic of Bulgaria, the Chamber of Private Bailiffs and the Minister of Justice against the part of Decision No. 5479 / 12.05.2020 under Adm. Case No. 5937 / 2019 of a three-member panel of the Supreme Administrative Court, which revoked the amendment of item 26 of section II “Proportional Fees” of the Tariff of Fees and Expenses to the Private Bailiffs Act (“The Tariff”), adopted by a decree of the Council of Ministers No. 52 / 05.03.2013.

The first instance case was initiated by a complaint of an individual against Section I “Ordinary fees” from items 1 to 13 incl. and from items 16 to 19 incl. and Section II, item 26 of “The Tariff”, adopted by Decree of the Council of Ministers No. 92 / 19.04.2006, promulgated SG vol. 35 / 28.04.2006. Repeal of the above texts is requested due to an ethics conflict and the Private Bailiffs Act. Only item 26 of the case remains in the subject matter, as the other provisions have already been subject to a judicial review and there are no legal grounds to be “reconsidered” again. In May 2020, a three-member panel of the Supreme Administrative Court repealed item 26 of “The Tariff”. It provides that for the execution of a pecuniary claim, a fee is collected depending on the claim, as follows:

  • up to BGN 100 – BGN 10;
  • from BGN 100 to BGN 1,000 – BGN 10 + 10 per cent for the excess over BGN 100;
  • from BGN 1,000 to 10,000 – BGN 100 + 8 percent for the excess over BGN 1,000;
  • from BGN 10,000 to BGN 50,000 – BGN 820 + 6 per cent for the excess over BGN 10,000;
  • from BGN 50,000 to BGN 100,000 – BGN 3,220 + 4 per cent for the excess over BGN 50,000;
  • over BGN 100,000 – BGN 5,220 + 2 per cent for the excess over BGN 100,000.

The amount of the fees above is as of 12th March, 2013. Then they were reduced by BGN 5.

Due to the insignificant decrease, the majority of the court panel accepted that for the past period after the changes, the economic burden has not decreased and the goal set for reducing the debt and improving the business climate in the country has not been achieved. The Supreme Judges accepted that on the contrary – the fees remain significant and hinder economic turnover, and therefore they do not comply with Article 6 of the Administrative Procedural Code and they repealed item 26 of the tariff of. Dissatisfied with the first instance judicial act, the Council of Ministers and the Chamber of Private Bailiffs appealed the decision as inadmissible and unfounded due to a substantial violation of the rules of court proceedings and with a final judicial decision on 11.01.2021. The five-member panel of the Supreme Administrative Court annulled the decision as wrongly applied in the appealed part.

The five Supreme Judges recalled item 26 before its amendment, i.e. when the fees were higher with BGN 5; it was already a subject of judicial review and was declared as legitimate. With the amendment of item 26 of “The Tariff”, adopted by decree of the Council of Ministers No. 52 / 05.03.2013, the minimum amount of the fee in each row has been reduced by BGN 5, without a change to the percentage for the cases when the fee is above the minimum amount for the respective claim. Therefore, each fee, calculated on the same amount, after the disputed amendment is five levs lower than before the amendment. This reduction, according to the report of the petitioner (Minister of Justice), aims to reflect the legal changes and in principle to limit the minimum amount of proportional fees to one tenth of the price of the claim or the price of the property on which the execution is directed. The five-member panel found that with the minimum amount of the reduced fee, there were no proportional fees that were more than ten percent of the price of the claim, which was possible before the amendment was contested.

The Supreme Administrative Court stated in its decision (No. 293 / 11.01.2021): “Therefore, the purpose of the amendment of the tariff has been achieved, as well as full compliance with the norm of Article 83, paragraph 2 of the Private Bailiffs Act, requiring the sum of all proportional fees not to exceed one tenth of the obligation. Through the contested amendment, there is no longer a minimum fee of more than one tenth of the obligation and in practice the hypothesis of a statutory exception to this rule is not possible – namely the possibility that the sum of proportional fees is greater than one tenth of the debt when there minimum amount over one tenth.

You can find additional information on the case on the following link.