A few days ago in FAKTI we published an article - Who is more powerful - Lord, the Bulgarian court or the State Fund "Agriculture"… Long before we released it, we sent questions to the State Fund "Agriculture" on the topic, in order to show their side's thesis. And although with a slight delay, we received an answer. So the topic has a resolution.
Let's recall
The editorial staff of FACTI received a signal from Tsvetelina Vatovska, who is the manager of a company that purchased a mobile installation for processing essential oil crops. It all started in the distant 2016. (editor's note - it is important to remember the year)
The company submitted an application for support under the Rural Development Program for the period 2014-2020 under Sub-measure 4.2. “Investments in processing/marketing of agricultural products” from measure 4. “Investments in tangible assets”. The application meets all legal requirements. After that, the company purchased a mobile installation for processing essential oil crops, the installation being located in the village of Galabets, Pomorie Municipality. All necessary documents were submitted to the State Fund “Agriculture”, required for the financing of the project, and all instructions given by the administrative authority have been fulfilled. But…
And so the saga begins - from 2016
To date, the State Fund “Agriculture“ has not exercised its legal competence to conclude the grant financing agreement.
By order dated September 17, 2018, the Deputy Executive Director of the State Fund “Agriculture” denied financing, on the grounds that the investment applied for is not mobile. This denial is subject to an appeal to the court. With the entry into force of Decision No. 228 of February 13, 2019 of the Burgas Administrative Court, Order No. 03-RD/3716 of September 17, 2018 of the deputy executive director of the State Fund "Agriculture", which refused to finance the project. The court sentenced the administrative body to carry out the action to ensure financing of the project. An appeal followed and another court decision of 23.12.2019 by the Supreme Administrative Court - fourth department, by which the unlawful order to refuse financing of the investment for a mobile installation was canceled. In these two court proceedings, the State Fund "Agriculture" was a party and therefore is fully aware of the court's motives.
The Burgas Administrative Court and the Supreme Administrative Court in their court decisions say that the company's claims meet all legal requirements, namely:
- an investment was made to purchase a mobile installation for processing essential oil crops, which is located in a rural area specified in Appendix No. 3 to the same, namely – on the territory of the Municipality – Pomorie
- the company has submitted all the required documents for the financing of the project, and all the instructions given by the administrative authority have been fulfilled
Despite the positive decision of the court, the State Fund “Agriculture“ has not taken any action for more than 5 years to provide the subsidy for which the company applied, although the case has categorically established the existence of the investment made.
Following cases, rulings, decisions, new letters to the State Fund “Agriculture“. This leads to 2021, when the State Fund “Agriculture“ again ruled to refuse financing, because upon inquiry it turns out that Ms. Vatovska's company has obligations to the National Revenue Agency.
Until 2021, there have been two court decisions – Burgas Administrative court and the Supreme Administrative Court, which annul orders of directors of the State Fund "Agriculture" to refuse financing.
On June 17, we sent these questions to the State Fund "Agriculture":
- Since Ms. Vatovska's company is in good standing in terms of documents, what is the reason for not providing financing?
- On what grounds were the various directors of the State Fund "Agriculture" refused until 2021?
- Why are two decisions of the Bulgarian court - the Burgas Administrative Court and the Supreme Administrative Court - not being implemented, after it was ruled that the orders to refuse financing of various directors of the State Fund "Agriculture" are unlawful?
- Why is the State Fund "Agriculture" not implementing decisions of court?
- Why has the State Fund "Agriculture" not responded to Ms. Vatovska's correspondence for nearly 5 years - from 2019 to November 2024 - with which she wants to receive the funding.
- What are the deadlines according to Regulation No. 20, under which the candidate for the funding in question was applied for, for responding to inquiries, when there are any from beneficiaries.
The response of the State Fund "Agriculture"
(b.r. – the answer is full of citations of laws, articles and paragraphs, which will not mean anything to many of you, but we must trust the lawyers in the state administration that they know how to answer journalists. We provide you with the answer of the State Fund “Agriculture“ in its full version to the questions we asked).
I. With Decision No. 228 of 13.02.2019, which entered into legal force on 23.12.2019, issued in administrative case No. 2856/2018 in the inventory of the Administrative Court – Burgas, confirmed by Decision No. 17652 of 23.12.2019 in adm. case No. 4815/2019 on the list of the Supreme Administrative Court of the Republic of Bulgaria, IV department, has been completely annulled as unlawful Order No. 03-РД/3716 of 17.09.2018 for the rejection of application for support No. 02/04/2/0/00298 of 17.12.2015 under sub-measure 4.2 “Investments in processing/marketing of agricultural products“ from the RDP (2014-2020), and by virtue of the second operative part of the cassation court decision, the State Fund for Agricultural Development owes a new ruling on the application, in accordance with the mandatory instructions given by the courts on the interpretation and application of the law.
Directorate “DPMRSD“ has fully complied with the issued and cited court acts, and has ruled on the application, in accordance with the mandatory instructions given by the courts on the interpretation and application of the law. The application for assistance No. 02/04/2/0/00298 of 17.12.2015 has been reviewed in substance and has been APPROVED FOR FINANCING ON 26.07.2021.
II. Before concluding a grant agreement, on the basis of Art. 39 (according to the wording before the entry into force of the NID of Ordinance No. 20 of 27.10.2015, published in the State Gazette, issue 102, in force from 22.12.2017, applicable on the basis of §31 of the PZR of the NID of Ordinance No. 20 of 27.10.2015) the applicant was sent a notification letter No. 01-2600/4733 of 26.07.2021 with the following content: “1. On the basis of Art. 8, para. 2, item 3 of Ordinance No. 20 of 27.10.2015 for the application of sub-measure 4.2. “Investments in processing/marketing of agricultural products“ from measure 4. “Investments in tangible assets“ from the RDP for the period 2014 - 2020 and in accordance with Art. 87, para. 11 of the Tax and Social Security Procedure Code, during an official inspection carried out on 19.07.2021 for the presence or absence of overdue liabilities to the NRA, it was established that “INVESTSTROY“ EOOD and Tsvetelina Petkova Vatovska as an individual HAVE LIABILITIES to the budget.
Certificates of absence of liabilities to the NRA (issued no earlier than 6 months before the date of their submission) must be submitted. The Certificates should show the absence of debts, or the amount of unpaid debts should not exceed 1 percent of the total annual turnover of the applicant company for the last completed financial year (in case of debts, a statement of income and expenses for the last completed financial year must also be submitted). An applicant who, as shown by the Certificate, has debts exceeding 1 percent of the total annual turnover for the last completed financial year is entitled to submit evidence that he has taken measures to ensure his reliability. For this purpose, the applicant may submit the following documents: a document for a payment or agreement, or another document showing that the debts are secured or that the parties have agreed on their postponement or rescheduling, together with a repayment plan and/or with specified dates for the final payment of the debts due or is in the process of paying the compensation due.
2. A certificate of no liabilities to the municipality of the applicant's registered office must be submitted. Also, a certificate of no liabilities to the municipality of Burgas must be submitted by the representative and owner of „INVESTSTROY“ EOOD.
3. A criminal record certificate from the applicant - an individual, or the sole proprietor, commercial company or legal entity representing the applicant and member/s of their management body, as well as a person temporarily holding such a position, including procurators or commercial attorneys, issued no earlier than 4 months before its submission (in the event that according to the criminal record certificate the person has been convicted, it is necessary to submit relevant documents indicating the nature of the conviction).
4. A declaration of the circumstances under Art. 8, para. 3, p. 1 of Regulation No. 20 of 27.10.2015, representing Appendix No. 2a to Regulation No. 20 of 27.10.2015, in the form attached to this notification letter, signed personally by the persons under item 3.“
A response has been received from the applicant with Entry No. 02-020-2600/12081 of 26.08.2021. A protocol has been submitted between a public contractor of the NRA and “INVESTSTROY“ EOOD in connection with an enforcement case initiated for unpaid public receivables in the NRA Burgas District Court under No. 170322569/2017 against the cited company, with which the person Tsvetelina Vatovska undertook to repay the public liabilities within 8 months in equal monthly installments, with the first monthly installment to be received by 28.09.2021, and the remaining seven installments each month by 28.04.2022.
In the case of liabilities, a Statement of Income and Expenditure for the last completed financial year should have been submitted in order to assess whether the amount of unpaid liabilities does not exceed 1 percent of the total annual turnover of the enterprise, as is the condition of Regulation No. 20 of 27.10.2015, but such a statement was not submitted.
DFZ has made an inquiry to the NRA (exit No. 07-1200/1291) as to whether the protocols for deferring liabilities submitted by the beneficiaries give rise to an irrevocable commitment of the person to repay the liabilities, as well as what are the consequences of untimely fulfillment or failure to comply with the commitments undertaken.
In response with exit. No. M-24-03-2464#1 and int. No. 07-1200/1291#1 of the Central Administrative Court of the NRA states the following: “In the exercise of their powers, the public enforcement officers of the NRA may draw up a protocol of action, which, within the meaning of Art. 50, para. 1 of the Code of Civil Procedure, is evidence of the actions and statements taken by or before the relevant body, as well as of the facts and circumstances established in the course of specific proceedings against an obligated person. According to Art. 226, para. 2 of the Code of Civil Procedure, a protocol is drawn up for each action taken and carried out by the public enforcement officer, and the date and place of its drawing up, the actions taken, the requests made, the amounts received and the expenses incurred are noted in it. The protocols of action, containing information about commitments undertaken before a public enforcement officer by the obligated persons to repay the obligations in parts or by a certain deadline, DO NOT have the character of an administrative act – permission to reschedule/deferral of outstanding public obligations within the meaning of Chapter 22 of the Code of Civil Procedure. They only certify the statement of the respective obligated person of his intentions to pay his obligation in parts or by a certain deadline. In this sense, the protocols do not give rise to legal consequences, both for the administration and in relation to the individuals. The statement of the obligated person is a manifestation of good faith behavior, i.e. the debtor is not hiding, but wants to pay, albeit in parts/by a certain deadline, but his debt continues to be due in full and there are no obstacles for the public executor to take action to secure and collect the public obligations.“
A Certificate of absence of obligations to the municipality of the applicant's seat is missing.
In the event of repayment of obligations to the NRA and the MDT, the applicant should have notified the State Fund of a change in circumstances, since this did not happen, the State Fund issues a repeated refusal for financing on a different legal basis, namely the outstanding obligations to the state and the municipality of the applicant's seat.
III. In view of the above and on the basis of Art. 20a, para. 2 of the Act on Support for Agricultural Producers and Art. 41 e, para. (1), item 7, in connection with art. 8, para. (2), item 3 of Ordinance No. 20 of 27.10.2015, in connection with §31 of the final provisions of Ordinance No. 20 of 27.10.2015 on the implementation of sub-measure 4.2. “Investments in processing/marketing of agricultural products“ from measure 4. “Investments in tangible assets“ from the Rural Development Program for the period 2014 - 2020, in force in the version in the State Gazette No. 69 of 02.09.2016, application for support under sub-measure 4.2 with ID No. 02/04/2/0/00298 of 17.12.2015. The applicant “INVESTSTROY“ EOOD receives a complete repeated refusal for financing under the sub-measure due to non-compliance with the approval requirements – the presence of outstanding public liabilities to the National Revenue Agency, as well as the failure to provide a required certification document required under the applicable regulation. The repeated refusal to approve the application is objectified in the Order of Refusal No. 03-RD/6135 of 25.11.2024 of the Executive Director of the State Fund “Agriculture“ for financing an application for support ID No. 02/04/2/0/00298 of “INVESTSTROY“ EOOD. The applicant is notified by a letter of refusal with issue no. No. 01-2600/2535 of 25.11.2024.
The refusal order was appealed under the procedure of the APC within the statutory period from its notification under administrative procedure by the candidate before the Administrative Court-Burgas, which issued a decision in administrative case No. 206/2025 on 28.05.2025 to cancel the cited refusal letter. State Fund "Agriculture" was officially notified of the court's decision on 10.06.2025. The decision of the Administrative Court Burgas was appealed on 23.06.2025 by the State Fund.
In its signal, the applicant “INVESTSTROY“ EOOD admits that it indeed has unpaid financial/public obligations even at the present time. It remains unclear to us, since the applicant has put himself in this situation, why he is contacting various services and institutions, given that as of 19.07.2021. even at the present time there are outstanding obligations to the NRA, thus “INVESTSTROY“ EOOD does not meet the condition of Art. 8, para. (2), item 3 of Ordinance No. 20 of 27.10.2015 (edition of 22.12.2017) of Ordinance No. 20 of 27.10.2015 on the implementation of sub-measure 4.2. “Investments in processing/marketing of agricultural products“, namely: “Art. 8. (Amended – SG, issue 102 of 2017, effective 22.12.2017), para. (2) No financial assistance shall be provided to applicants/beneficiaries who:
3. have obligations within the meaning of Art. 162, para. 2, item 1 of the Tax and Social Security Procedure Code to the state and/or to the municipality of the applicant's registered office for taxes and/or mandatory social security contributions, unless the deferral, postponement or security of the obligations is allowed; the type and amount of the obligations should be established by an effective act of a competent authority“.
After everything written so far – We hope you understand the logic, a question arises. Why, in a case that began in 2016, are there decisions of two court instances by 2019, as a reason for refusing financing in 2021, tax liabilities of a company for 2019 are cited? In reality, by 2019, two Bulgarian court instances have ruled “to pay”, and this is not happening. And already in 2021, “an obligation to the NRA is found”. This time we will not interfere with God. He has more important things to do. But the state, oh the state, where is the state that thinks so strongly about business. Right now we are talking about essential oil crops. An interesting segment of the Bulgarian economy, but where is the state. Why is the state doing this?
New questions
After we received the answers from the State Fund for Agriculture, Ms. Vatovska also wrote to us with new questions. Here are some:
To the editorial staff of “FACTI BG“
Dear editors,
Thank you for the opportunity to share my position on the Strategic Plan for the Development of Agriculture 2023-2027, as well as to draw attention to specific problems affecting the real support for the essential oil sector and the work of the institutions.
The agricultural company I manage is implementing an investment project approved in accordance with all regulatory requirements. However:
- no on-site inspection was carried out;
- no certificate of the presence or absence of public obligations was requested;
- no invitation to provide additional documents was sent;
- most importantly - for over four years (2019-2024) there was absolutely no communication or statement from the State Fund "Agriculture".
Instead of dialogue and partnership - a silent refusal followed, without reasons and without the possibility of prior protection of the investor's interests.
The problem is systemic, not individual. This case is just one example of many. It raises questions about:
- compliance with the principle of good administration
- the obligation of institutions to rule within a reasonable time
- and the lack of control over the administrative bodies themselves
When the state does not respond, does not check, does not require and does not communicate, trust in public programs collapses.
Questions to the institutions:
1. Is it normal for a case to remain unsolved for 4-5 years?
2. Why are there no on-site inspections, despite the fund's obligation?
3. Who is responsible for the lack of communication and administrative control?
4. What is the real effectiveness of the newly established directorates and local initiative groups?
5. Will there be a reform that will truly bring policies closer to the needs of real agricultural businesses?
The sector does not need new strategies on paper. It needs a functioning administration, transparent procedures and predictable support.
I hope that this signal will be heard and will draw attention to the real problems of people who work in agriculture, produce, invest and create value despite systemic obstacles.