The Bulgarian Crypto-Asset Markets Act (CAMA) in force as of 8 July 2025 implements in the national legislation the EU Regulation on Markets in Crypto- Assets (MiCA), as well as the regulations on information accompanying transfers of funds and transfers of certain crypto-assets and on the operational resilience of digital technologies in the financial sector.
The Financial Supervision Commission (FSC) is the national competent authority for the purposes of regulating and supervising the activities of crypto-asset service providers, issuers of asset-backed tokens and issuers of crypto-assets other than asset-backed tokens or electronic money tokens. The licensing regime can be outlined as the most significant part of the new law: the FSC will issue licenses to persons wishing to operate as crypto-asset service providers.
In addition to the prudential requirements, worth noting are the governance arrangements – the requirements to the members of the management body of crypto-asset service providers and persons managing their activities, shareholders or persons having a direct or indirect qualifying holding in the crypto-asset service provider. These strict requirements also apply to individuals who are identified as beneficial owners of a crypto-asset service provider, as well as to individuals who are designated as representatives of a legal entity – a member of the management body of the crypto-asset service provider.
First, such members shall at any time be compliant with Art. 68 of MiCA, and:
- possess sufficiently good repute and the appropriate knowledge, skills and experience, both individually and collectively, to perform their duties;
- shall not have been convicted of offences relating to money laundering or terrorist financing or of any other offences that would affect their good repute;
- shall demonstrate that they are capable of committing sufficient time to effectively perform their duties.
Next, pursuant to Art. 17, para. 2 of CAMA such members shall also:
- not have been convicted of an intentional crime of a general nature, unless they have been rehabilitated;
- not have been a member of a management or control body or an unlimited partner in a company for which bankruptcy proceedings have been opened, or in a company dissolved due to bankruptcy during the last two years preceding the date of the decision to declare bankruptcy, if there were unsatisfied creditors; this restriction is lifted upon the expiration of a 5-year period from the dissolution of the company due to bankruptcy;
- not have been declared bankrupt or are not in bankruptcy proceedings; this restriction is lifted upon the expiration of a 5-year period from the termination of the company due to bankruptcy;
- not be deprived of the right to hold a position of material responsibility or to carry out professional activities;
- not fall within the restrictions for holding a senior management position under Art. 124 of the AML Measures Act;
- not have been, during the last two years prior to the act of the relevant competent authority, a member of a management or supervisory body of a company which license to carry out an activity subject to a licensing regime was revoked by FSC or the Bulgarian National Bank, or by a relevant authority of another country, except in cases where the license was revoked at the request of the company, as well as when the act of revocation of the issued license was revoked in accordance with the due procedure, as well as when more than 5 years have passed since the act of revocation of the license entered into force;
- not been subject to administrative penalties imposed by effective penal decrees in the last 5 years for a gross or systematic violation of CAMA and the listed national and EU legislation or their implementing acts, or the relevant legislation of another country;
- not have been dismissed from a position in a management or control body of a company under CAMA and the listed national legislation or the relevant legislation of another country, on the basis of an applied coercive administrative measure, except in cases where the act has been revoked in accordance with the due procedure;
- based on the data collected about them and their related parties, as well as the relationships between them, it should not give rise to any doubt about their reliability and suitability, and the possibility of a conflict of interest.
During the licensing process and thereafter, the FSC will exchange information with the competent supervisory authorities in the countries where the persons claim to have acquired their good repute, knowledge, skills and experience, to confirm the veracity of the information and the evidence thereto.
The above requirements do not apply to a credit institution, central securities depository, investment firm, market operator, electronic money institution, UCITS management company, or an alternative investment fund manager, that provide crypto-asset services after the notification with the respective information and confirmation by FSC.
Crypto-asset service providers shall notify FSC without delay of any changes to their management body, prior to the exercise of activities by any new members, and shall provide FSC with all the necessary information to assess compliance with the above requirements.
Where the influence exercised by the shareholders or members, whether direct or indirect, that have qualifying holdings in a crypto-asset service provider is likely to be prejudicial to the sound and prudent management of that crypto-asset service provider, competent authorities shall take appropriate measures to address those risks. Such measures may include applications for judicial orders or the imposition of penalties against directors and those responsible for management, or the suspension of the exercise of the voting rights attaching to the shares held by the shareholders or members, whether direct or indirect, that have the qualifying holdings.
The FSC’s practice on the application of requirements to the management body of crypto-asset service providers is yet to be established.
If you have any questions or require consultation regarding the requirements under MiCA and the LCRA, you can contact our team.
