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Petrov, Anton --- "BULGARIA" [2019] ELECD 2738; in Nagy, Csongor (ed), "Investment Arbitration in Central and Eastern Europe" (Edward Elgar Publishing, 2019) 24

Book Title: Investment Arbitration in Central and Eastern Europe

Editor(s): Nagy, Csongor

Publisher: Edward Elgar Publishing

Section: Chapter 2

Section Title: BULGARIA

Author(s): Petrov, Anton

Number of pages: 44

Abstract/Description:

Bulgaria is seen by many as having a favourable foreign investment regime that includes government incentives for new ventures and low or flat corporate and income taxes. However, investors also note the existence of problems with the rule of law, slow judicial processes and unpredictability due to frequent legislative changes. This chapter outlines the main national rules on investment promotion and protection, as well as the most frequently used dispute resolution procedures at domestic and international level. An overview of arbitration cases shows how lucrative investments may fail due to misunderstanding or disregard of local social phenomena that cause swift and often unpredictable political decisions, switching the behaviour of regulatory agencies overnight. Due to the small number of published international arbitration awards, it is not possible to make a comprehensive assessment of the Bulgarian involvement in these procedures. The results so far indicate that the State was fairly successful and, therefore, the experience largely positive. At the same time, there is a growing discontent among the general public about the constantly rising number of cases launched against Bulgaria before the ICSID. The situation poses a dilemma before the national governments: how to balance the goal of attracting international capital, while at the same time preserve their political manoeuvring space.