As part of the Financial Innovation Monitoring Strategy of the Financial Supervision Commission for the period 2021-2024, the FSC continues its commitment to develop and improve its supervisory activities together with other European regulators and actively seek harmonization of national regulatory frameworks and practices in the field of financial innovation, including the implementation of artificial intelligence models.

In this respect, guided by its principle of active communication and dialogue with supervised entities, the FSC undertook a study to identify key topics related to the benefits, challenges and development of AI. The aim is to analyse in more detail the innovation in question and outline the current and future direction of development through analysis, opinions and criticism.

A total of 106 supervised entities answered the questions. The most active are the insurance brokers – 81%, followed by the insurance companies – 16%.

The topics in the initiated discussion document were related to the trends in the development of AI, the benefits and disadvantages of implementation, as well as the challenges facing companies, namely: the investments they have to make and the level of service they have to offer. Last but not least, the opinion of the supervised entities was sought regarding their attitudes towards greater use of AI by the regulator, and the responses reflected a positive attitude towards the policy to support the implementation of AI by the supervisory authority.

The ambitious goals set by the FSC in the field of financial innovation require work in unison with the imposed European principles and according to the level of risk posed by the respective AI systems, requirements will be determined to meet the quantitative and qualitative data, human force involved in the process and approach of data validation, testing and documentation. The key to the introduction of an AI system will be clearly defined managerial responsibilities for the business process, the level of risk in outsourcing the service, ensuring impartiality of results, algorithms used in decision-making processes, eliminating opportunities for action related to legal violations.

The Chairman of the Financial Supervision Commission, Mr. Boyko Atanasov, expressed his gratitude for the commitment and high level of activity on the part of the participants in the study. He believes that the obtained results are extremely important for determining the current situation in the field of AI use and for outlining the framework in which to work effectively in integrating artificial intelligence and overcoming the challenges facing the non-banking financial sector in this regard.

The updated Financial Innovation Monitoring Strategy for the Period 2021-2024, published on the Financial Supervision Commission’s website, aims to establish a dialogue between the regulator and business, with a view to outlining possible future joint initiatives to integrate AI systems into the non-banking financial sector.

The presented data on the value and number of paid and filed claims under Motor Third Party Liability Insurance, including by risk groups, as of 30.09.2021 are published on the FSC website – www.fsc.bg, section “Insurance Activity”, “Statistics”, “Non-life Insurance”, “2021”. The data do not include insurance contracts that are concluded by insurers under the right of establishment or under the terms of freedom to provide services.

The Financial Supervision Commission (FSC) informs all interested parties that at its meeting held on 05.10.2021 a decision was made to conduct an examination for professional qualification of insurance brokers in accordance with Ordinance No. 28 of 10.05.2006 of the FSC on the terms and procedure for conducting an examination for the professional qualification of insurance brokers and for the recognition of a qualification acquired in a Member State and for the registration of vocational training materials.

The examination will be held on 27 November 2021.

By 20.10.2021, the interested persons should submit an application for admission to the examination according to an approved template, together with the appendices under Art. 3, para. 2 of Ordinance No. 28 of 10.05.2006, namely: police clearance certificate or other similar document certifying the circumstances under Art. 303, para. 1, item 1 of the IC; a notarized copy of a diploma of higher education obtained in the country, respectively a legalized translation of a diploma of higher education obtained in a higher school outside the Republic of Bulgaria, to certify the circumstances under Art. 303, para. 2 of the IC and a declaration of the circumstances under Art. 303, para. 1, items 2 – 4 of the IC, according to a template.

Applications can be submitted every working day at the FSC office or signed with an electronic signature at the following e-mail address: delovodstvo@fsc.bg. A fee in the amount of BGN 450.00 (four hundred and fifty) shall be paid for taking the exam, based on Section I, item VI, line 15 in connection with Section IV, item IV of the Tariff of Fees Collected by the FSC under the Financial Supervision Commission Act, to the following bank account: IBAN: BG 95 BNBG 9661 3000 1415 01, BIC of BNB -Central office: BNBGBGSD.

The topics covered by the examination are published on the FSC’s website, in the section “Supervised entities”, “Qualification examinations”, “Insurance brokers examinations”, where the list of admitted candidates will be announced, as well as all other announcements related to the conduct on this exam.

The Financial Supervision Commission of the Republic of Bulgaria warns all potential investors that Infinitrade, operating through the website www.infinitrade.com, does not have a license for an investment firm and is not entitled to carry out investment activities.

The Financial Supervision Commission (FSC) of the Republic of Bulgaria warns all potential investors that Infinitrade, operating through the website www.infinitrade.com and the companies A&I Products EOOD and A&I Products EOOD do not have a license issued by the FSC or by a competent authority of another Member State to act as an investment firm and are not entitled to provide investment services and / or to carry out investment activities. The listed companies are not entitled to receive money from individuals for the purpose of investing them in financial instruments.

The FSC draws the attention of potential investors to the fact that before transferring funds for trading in financial instruments, they should always check on the FSC website whether the person on whose account they intend to make the transfer has the right to provide investment services and / or perform investment activities.

An up-to-date list of companies that do not have a license to operate as an investment firm or management company in the territory of the Republic of Bulgaria is available here.

Information on companies and platforms for which information is available that they are not licensed can also be found on the websites of:

 ESMA – https://www.esma.europa.eu/investor-corner/warning-and-publications-investors/;

 International Organization of Securities Commission (IOSCO) – www.iosco.org/investor_protection/?subsection=investor_alerts_portal.

Pursuant to Art. 86, para. 11 of Ordinance No. 53 of 23.12.2016 on the requirements for reporting, valuation of assets and liabilities and the formation of technical reserves of insurers, reinsurers and the Guarantee Fund, the Financial Supervision Commission published the maximum amount of technical interest for calculating premiums and reserves for the period from 1 October 2021 to 31 December 2021. Data on the maximum amount of technical interest can be found in the section “Insurance Activity”, “Statistics”, “Life Insurance”.

On 05.10.2021 the Financial Supervision Commission was notified by the Financial Supervision Authority of the Republic of Romania (FINANCIAL SUPERVISORY AUTHORITY ROMANIA) of the revocation of the license of the Romanian insurer SOCIETATEA DE ASIGURARE – REASIGURARE CITY INSURANCE S.A. due to insolvency of the insurer. Action has been taken by the Romanian national competent authority before the competent Romanian court to open insolvency proceedings against the insurance company.

SOCIETATEA DE ASIGURARE – REASIGURARE CITY INSURANCE S.A. has the right to operate on the territory of the Republic of Bulgaria under the terms of freedom to provide services, but according to the Romanian Financial Supervision Authority the insurer has not issued insurance to cover risks located in the territory of the Republic of Bulgaria.

The notice of license revocation is published on the website of the Financial Supervision Authority of the Republic of Romania at: https://asfromania.ro/en/a/2191/press-release.

The Financial Supervision Commission will promptly publish on its website: www.fsc.bg any information in connection with the open insolvency proceedings of SOCIETATEA DE ASIGURARE – REASIGURARE CITY INSURANCE S.A.

Up-to-date information can also be obtained through the Commission Information Centre: 0800 40 444 (toll-free number).

“The implementation of the Solvency II Regulation is expected in the short term to result in the release of up to € 90 billion in capital / financial resources that EU insurers can use to help recover from the current global crisis.” This was said by Mr. Vladimir Savov – Deputy Chairperson of the Financial Supervision Commission, Head of the Insurance Supervision Department in a special interview for dir.bg.

Mr. Savov added that “Those up to € 90 billion would be released in the short term, provided that the full combination of EC options is implemented in their current form. With the introduction of the changes over the next few years, these funds are expected to decline, including due to changes in market conditions.“

Among the other topics that the Deputy Chairperson of the FSC commented on is the accelerated digitalization of the insurance market caused by the pandemic, and his opinion, based on the latest available data in the FSC, is that in the last year the COVID-19 related risk is relatively limited in the insurance sector. The market is in relatively good financial condition and is prepared to meet a possible next wave.

At its meeting on 07.10.2021 the FSC decided to send a request to the Chairperson of the Sofia Regional Court to order all enterprises providing public electronic communications networks and / or services to suspend access to websites duly described in the FSC Decision No. 716-ИП/28.09.2021 and which by 07.10.2021 have not stopped offering investment services and activities by persons who are not entitled to carry out such services.

The Chairperson of the Sofia Regional Court ordered all enterprises providing electronic communications networks and / or services within 24 hours from the publication of the order on the FSC website (14.10.2021) to suspend access from the territory of the Republic of Bulgaria to the four websites explicitly mentioned in the FSC’s request.

The suspension of access to the described websites is necessitated by the fact that investment services are provided through them by persons who are not entitled to provide such services on the territory of the Republic of Bulgaria.

The order of the Chairperson of the Sofia Regional Court, together with the websites to which access should be suspended can be found in the attached file (available in BG version only).