Bulgaria

VIII - ESM Treaty

The European Stability Mechanism (ESM) Treaty was signed on July 11 2011. It was later renegotiated and a new ESM Treaty was signed on February 2, 2012. The Treaty provides a permanent emergency fund that is intended to succeed the temporary emergency funds. It entered into force on September 27, 2012 for 16 contracting parties (Estonia completed ratification on October 3). The 17 contracting parties are the member states of the Eurozone, but the ESM Treaty is concluded outside EU law.          
(
http://www.european-council.europa.eu/eurozone-governance/esm-treaty-signature?lang=it and http://www.esm.europa.eu/pdf/FAQ%20ESM%2008102012.pdf)

Negotiation
VIII.1
What political/legal difficulties
did Bulgaria encounter in the negotiation of the ESM Treaty, in particular in relation to the implications of the treaty for (budgetary) sovereignty, constitutional law, socio-economic fundamental rights, and the budgetary process.

The ESM Treaty is one of the international law instruments dealing with the Euro crisis in which Bulgaria is not participating as it is not a Eurozone Member State. However, in light of the resolve of Bulgaria to join the Eurozone in the future, the Bulgarian Government decided to participate in the negotiations of the ESM Treaty. This was considered important as the rules contained therein would eventually be applicable to Bulgaria, once it joins the Eurozone.

The Minister for Finance (on 4 May 2011 in the National Assembly) and his Deputy (on 30 March 2011 in the joint session of the Committees on European Issues and Budget and Finance) highlighted that with its participation in the negotiations, Bulgaria managed to secure a smoother transition with respect to the ESM contributions, once it joins the Eurozone. What they were referring to was basically the temporary correction of the contribution key set out in Article 42 of the ESM Treaty. This temporary correction allows for a Member State joining the ESM that has GDP per capita at market prices in euro in the year immediately preceding its accession to the ESM that is less than 75 % of the EU’s average GDP per capita at market prices to benefit from a temporary correction of the key which weights greatly on the gross national income. Furthermore, this temporary exception lasts for twelve years.

ratification
VIII.2
How has the ESM Treaty been ratified in Bulgaria and on what legal basis/argumentation?

Since Bulgaria participated only in the negotiations, the ESM Treaty was neither signed nor ratified by Bulgaria.

ratification difficulties
VIII.3
What political/legal difficulties
did Ireland encounter during the ratification of the ESM Treaty?

In light of the answer to the previous questions, this one is not applicable to Bulgaria.

Case law     
VIII.4
Is there a (constitutional) court judgment on the ESM Treaty?

The ESM Treaty has not been litigated at the BCC. 

Capital payment
VIII.5
What is the role of Parliament in the payment of the (first instalment of) paid-in capital required by the ESM Treaty (article 36 ESM Treaty)? What relevant debates have arisen in relation to this payment?

Not applicable to the Bulgarian National Assembly.

Application & Parliament    
VIII.6
What is the role of Parliament in the application of the ESM Treaty, for example with regard to decisions to grant financial assistance and the disbursement of tranches, which both require unanimous adoption by the Board of Governors composed of the national Finance Ministers?

Not applicable to Bulgaria.

Application difficulties 
VIII.7
What political/legal difficulties
did Bulgaria encounter in the application of the ESM Treaty?

Not applicable to Bulgaria.

Implementation
VIII.8
Have there been any relevant changes in national legislation in order to implement or to comply with requirements set by the ESM-Treaty?

Not applicable to Bulgaria.

Miscellaneous
VIII.9
What other information is relevant with regard to Bulgaria and the ESM Treaty?

No other relevant information.