THE NEW GOVERNMENT DECREE FOR DETERMINING THE LEGAL INTEREST ON OVERDUE LIABILITIES
IN BGN AND FOREIGN CURRENCIES
(IN FORCE AS OF 01.07.2012)
The Bulgarian Government Decree № 100 for determining the Legal Interest on overdue
liabilities in BGN (leva) and foreign currencies (“the Legal Interest Government Decree”) was
published in State Gazette, issue No. 42 on 05.06.2012, and entered into force as of
01.07.2012 repealing Government Decree № 72 for determining the Legal Interest on
overdue liabilities issued in 1994 ( “Government Decree № 72 issued in 1994” ).
The following is a brief overview of the Legal Interest Government Decree.
Legislative Background
The amendment in the current regulation is justified by the necessity of introducing
DIRECTIVE 2011/7/EU OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL on
combating late payment in commercial transactions in the Bulgarian legislation. In contrast to
the European Directive, the Bulgarian Legal Interest Government Decree is applicable to all
types of deals, not only to the commercial ones.
Legal Interest on Liabilities in BGN (leva)
The legal interest on overdue liabilities in BGN (leva) shall be the Base Interest Rate
administered by the Bulgarian National Bank in force as of the 1st of January, respectively the
1st of July of the current year increased by 10 points.
The legal interest in force as of the 1st of January of the current year is applicable for the first
half of the current year, accordingly, the legal interest rate in force as of the 1st of July – for
the second half of the year.
That rule applies for the below mentioned interest rates as well.
Legal Interest on Liabilities in EUR (euro)
The legal interest on overdue liabilities in EUR (euro) shall be the interest rate applied by the
European Central Bank in the main refinancing operations in force as of the 1st of January,
respectively the 1st of July of the current year increased by 10 points.
Legal Interest on Liabilities in Other Currencies
The legal interest on overdue liabilities in other foreign currencies is the one month LIBOR
(London Interbank Offered Rate) for the corresponding type of currency in force as of the 1st
of January, respectively the 1st of July of the current year increased by 10 points.
This Legal Alert has been prepared by DELCHEV & PARTNERS for information purposes
only and does not constitute legal advice. This information is not intended to create, and
receipt of it does not constitute, an attorney-client relationship. Readers should not act upon
this without seeking professional counsel.
As regards currencies, in respect of which LIBOR is not quoted, the legal interest on overdue
liabilities shall be the interest rate applied by the European Central Bank in the main
refinancing operations in force as of the 1st of January, respectively the 1st of July of the
current year increased by 10 points.
Daily Interest Rate
The daily rate of the legal interest shall be 1/360 of the annual interest rate of the listed
categories.
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DELCHEV & PARTNERS
This Legal Alert has been prepared by DELCHEV & PARTNERS for information purposes
only and does not constitute legal advice. This information is not intended to create, and
receipt of it does not constitute, an attorney-client relationship. Readers should not act upon
this without seeking professional counsel.