BRIEF HISTORY OF THE BULGARIAN CUSTOMS INSTITUTION (1879-2019) THE BEGINNING interests of the principality.“ The princely decree The development of the customs administra- on the establishment of customs also provides for tion in follows the main periods of devel- the duty taxation of foreign goods. The Decree opment of the Bulgarian state. also provides for duty-free imports from Eastern 1 The fi rst provisions for the organization and Rumelia and Macedonia. The date of the de- functioning of the Bulgarian customs were from cree - July the 7th, 1879 - is considered the birth- the beginning of 1879. After the adoption of the day of the Bulgarian customs administration. Turnovo Constitution on April 16, 1879 (the fi rst During the fi rst fi ve years of Bulgarian customs ), Prince Alexander I Bat- activity, their legal basis is the „Customs Statute tenberg with Decree No 1 of 5 July appointed of the Bulgarian Principality“, endorsed by the the Ministers and the President of the Council of Russian Imperial Commissioner in Bulgaria. Ac- Ministers of the fi rst Bulgarian government, and cording to Article 1 of the Statute, customs are customs houses and customs points were estab- offi ces at the border through which imports and lished by Decree No.2 „in order to preserve the exports are made. Customs management is

Sketch (according to description from 1879) The Decree establishing the Bulgarian Customs of a uniform of a customs offi cer

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1 Autonomous Province of the Ottoman Empire, established in Southern Bulgaria under the Berlin Treaty of 1878 entrusted to the Ministry of Finance, where the For the fi rst time a Disciplinary Council was es- Customs Department is established. tablished to the Ministry of Finance, the status of The main trade routes of the principality with the customs guard was arranged, the rights and foreign countries are mainly two: the Black Sea - obligations of the customs brokers were speci- to the east and the Danube river - to the north. fi ed, an Expert Commission on disputes regarding The customs in Rousse, Lom, Vidin and Svishtov goods tariffi ng was created as well as a Revision serve imports from and to the countries of West- Commission, dealing with claims/appeals regard- ern Europe, South America, Serbia and Turkey. ing customs penal decrees and customs notices. Following the proclamation of the Unifi cation of The fi rst specifi c customs tariff was adopted the with East Rumelia on by the National Assembly on December the September 6, 1885, the duties remaining under an 17th, 1904 and began to apply as from the be- agreement signed only just in the previous year ginning of 1906. were canceled. Customs houses were found at The organization of the Customs Service, with our land border with Turkey. The primary task of a few exceptions, has been preserved for a long the government is to put under customs control time as it was settled right after the Liberation. the fl ow of goods and passengers passing through The Department of indirect taxes was set up to the railway lines. Two large customs houses were the Ministry of Finance which was also assigned opened - in Plovdiv and Harmanli, as well as cus- to serve as a customs division. In 1909, the De- toms houses in settlements inside the country. partment for indirect taxes was divided into two Already in their fi rst years, customs began to parts: for customs and for indirect taxes. In the keep statistics on imports and exports which be- beginning of 1911, the Customs Department be- comes clear from the Almanac „Statistics on the came autonomous after the transfer of munici- trade of the Principality of Bulgaria during 1883- pal taxes to tax structures. In 1925, an Anti-Smug- 1884.“ According to it, the customs houses of the gling Bureau was established on the basis of the Principality in 1884 were 25, some of which still Bureau of Infringements, and an Administrative exist today. Bureau was established in 1926 to include pros- In the beginning of 1885, the fi rst Customs ecution against smuggling and customs legisla- Act was adopted, which aimed to encourage tion enforcement activities, with the exception some branches of the emerging Bulgarian indus- of what concerns customs tariffs. Their applica- try. The duty-free export of leaf tobacco, wine, tion remained the responsibility of the Tariff Bu- brandy, grapes, fruit and vegetables, books, pic- reau. The structure of the Customs Department tures and icons was allowed. Even the fi rst laws in the early 1930s included: Administrative Bu- speak of import, export and transit as regimes. A reau, Bureau of tariffs, control, information and special emphasis was put on the rail transport, statistics and the Control chemical laboratory. which carried sealed wagons. In 1900, the Customs Regulation was adopted DURING THE SECOND WORLD WAR AND and for the fi rst time the details of the overall ac- AFTERWARDS tivity of the Bulgarian customs were examined. During the Second World War and in the pe- Together with its many applications, the regula- riod 1944-1989 the structure of Bulgaria‘s foreign tion is a true encyclopedia for the organization, trade and the work of customs were infl uenced management, personnel and the multilateral by political and historical processes. After Bul- activities of the Bulgarian customs in the early garia‘s entry into the war, absolute centralization 20th century. Customs offi cers are assigned to of imports and exports was imposed, a number collect customs duties, fi ght smuggling and pun- of prohibitions were introduced for the export of ish offenders. goods and materials needed to supply the local In 1906, a new customs act was drafted, population and the army. Customs reduced the which, although modifi ed many times accord- volume of their work several times. ing to the requirements of the developing econ- Amendments and supplements to the Cus- omy, remains in force for 42 years. For the fi rst toms Act during the war provided relief, facili- time the act has a separate chapter, devoted tation and encouragement concerning the ex- to the newly created chemical laboratories at emption from customs duties and other taxes on the customs. domestic industrial products at the exports, as

101 well as at the imports of all raw materials, wrap- THE BULGARIAN CUSTOMS AT pings, packaging and preservatives, necessary THE END OF XX AND THE BEGINNING for the manufacture of the products intended for export. During the bombing over Sofi a, the OF THE XXI CENTURY solution of issues that were within the compe- Following the changes in 1989-1990, the Bul- tence of the customs was done not by laws as garian customs administration undertook new was the usual practice but by decrees of the tasks, functions and responsibilities in the period Council of Ministers, approved by royal decrees of abolition of the state monopoly. because, as recorded in the reports, „customs Under an agreement in 1993 (in force since issues permit no delays“ and the customs institu- 1995), Bulgaria was associated to the European tion continues its activity even in the most tense Community and was committed to aligning its and fateful times for our country. legislation with that of the European Union (EU). After 1944, under the terms of a planned Priority has been placed on customs legislation economy, the customs are assigned with pro- as a basis for integration into the single European tecting the state monopoly on imports and ex- market. As a part of the process of Bulgaria‘s ac- ports and pursuing all forms of smuggling. The cession to the EU, in the period 2001-2002 the ne- import-export trade almost entirely goes from gotiations on Chapter 25 „Customs Union“ took the private sector to the hands of the state. Ad place. A strategic task was to determine the fur- valorem duties were introduced which, ac- ther increase in the administrative capacity to cording to the then decisions, „best refl ect the implement the Union‘s acquis, which included: role of duties on the planned development of developing a human resource management sys- the economy.“ In 1948, the Grand National As- tem, introducing ex-post control, improving the sembly passed a new customs act, but the main quality of infrastructure and equipment, further functions of the customs remained unchanged developing the system of customs laboratories, - to observe the interest of the Fisc and to fi ght computerization, development of a common/ smuggling. Part of the functions of the customs integrated tariff, fi ght against corruption. At the were reduced due to the fact that foreign end of 2003, the harmonization of customs legis- trade was a monopoly of the state, even for lation with that of the EU was almost complete. some period between 1960 and 1966 the cus- The computerization of customs activity is a toms went under the direction of the Ministry of key priority for the customs administration. In Foreign Trade and then returned to subordina- 1999, an Information Technology Strategy of the tion of the Ministry of Finance, as is the tradition National Customs Agency was adopted, con- after the Liberation to nowadays. In 1973, Bul- taining a decision to develop its own integrated garia became a member of the World Customs information system. In 2000, BICIS (the Bulgarian Organization. Integrated Customs Information System) started as a joint project of the Bulgarian Government and the European Commission. BICIS 1 was im- plemented and was functioning in all customs offi ces as of January 1st, 2001. The important in- ternational acts that our country signs, require the use of new techniques for customs control and information technologies. In 2003 in all cus- toms offi ces BICIS 2.1 was implemented, includ- ing a national Transit module. BICIS 2.1 is web- based and provides real-time transit control. The functionality of BICIS allows automated process- ing of customs – approved treatments or use and regimes. In the period 2005-2006, of utmost impor- tance for our country in connection with the In 1954 the fi rst bridge over the river Danube between accession to the EU is the fulfi llment of all the Bulgaria and Romania at Rousse was opened up. requirements for the development of BICIS. The After 2007 the bridge is an internal border. process is undergoing a new phase - building

102 and developing systems that interconnect with A major structural reform began in 2009, re- the EU systems. These include nine components, moving the intermediate structure between the two main ones being the Integrated Cus- the core units - customs houses and the Cen- toms Tariff of the community TARIC and a system tral Customs Directorate. The changes aimed of tariff quotas and surveillance. New modules at strengthening the customs authorities in the were introduced at the beginning of 2005, and fi eld of customs control. Offi cials from the spe- a year later, a functionality for accounting the cialized administration underwent professional customs duties was introduced as part of the competence tests. Ten years later (in 2018 and traditional own resources of the EU. Intercon- early 2019), another major reform was made in nectivity of the systems was achieved and the the structure of the National Customs Agency, opportunity to apply the EU Common Customs with customs offi ces and points being organized Tariff was given. in fi ve (instead of nine) territorial directorates, In the years before Bulgaria‘s EU member- and the units in the Central Customs Directorate ship, the trend was to achieve high fi scal re- were consolidated. Following an example of the sults. In 2004, the state budget revenue collect- IT activity, the Customs Intelligence and Investi- ed by the customs administration exceeded gation activities were brought together in a Di- the record 4 billion leva and by the end of 2006 rectorate General with territorial units. the collected revenue already exceed 7 billion In 2009 new responsibilities were assigned to and in the year 2018 they are close to 10 billion the customs administration. It also took the func- leva, which is over 45% of the tax revenue of tions of controlling the permits for international the state. passenger and cargo transport, control of the total mass, axle load and dimensions of road ve- THE BULGARIAN CUSTOMS hicles, collection and control of vignette fees at IN THE EUROPEAN FAMILY the border-crossing points. In 2018 in the process On January 1st, 2007, Bulgaria became a fully- of introducing an electronic vignette for passen- fl edged member of the European Union, which ger cars and tolls for freight vehicles, a leading directly altered the activity and structure of the function for customs offi cers became control. customs administra- At the same time, Bul- tion. After the acces- garia is building new sion of Bulgaria to the border-crossing points EU, the imports of the with neighboring coun- Member States were tries as well as due to transformed into an in- the increased trade tra-Community acquisi- traffi c, it increased the tion. About 57% of im- number of platforms ports and about 60% of at customs and border exports are no longer crossing points, thus in- controlled by the cus- creasing the number of toms administration. points where the con- On the other hand, the trol of tolls and permit customs administration regimes is carried out. also takes the adminis- At the end of 2015, tration of excise goods, the National Customs including in intra-Com- Agency also received munity supplies and additional responsibili- within the country. Ex- ties for the manage- cise duty became one ment of sites at the bor- of the major tasks of der - crossing points. the customs adminis- Since the beginning tration, both in the ad- of 2012, the customs ministration and in the authorities have been law enforcement. again empowered to

103 investigate customs and currency crimes. A Na- crime. In 2011, in the EC report Bulgaria ranks tional Coordination Center with a continuous fi rst on the enforcement of intellectual property work regime has been set up since the middle rights by the number of fake items retained, 28 of 2012, whose commitments are related to the per cent of all seized products in the EU. From implementation of a Community risk analysis for 2009 to 2018, customs offi cers seized more than security and safety, reception and processing of 58 million counterfeit items. alerts by citizens and an operational exchange The National Customs Agency also shows of information with the Territorial Coordination traditionally good results in the fi ght against the Centers and other law enforcement authorities. traffi cking of narcotic substances. In the period Since its very creation in 2015, the National Cus- 2015-2018 the Bulgarian customs offi cers have toms Agency has been involved with experts in seized a total of 28 730 kg, 16 133 liters and 740 the Interdepartmental Coordination Center for 835 tablets of narcotic substances and precur- counteracting the traffi cking and control of the sors. For this period, marijuana is the most fre- movement of risk goods and loads in Directo- quently detained type of drug at country‘s bor- rate General “Fight against organized crime” at ders, and heroin comes second as in 2018 the the Ministry of Interior. biggest seizure of heroin in the history of the Bul- One of the priorities for the Bulgarian customs garian customs was carried out – 712 610 kg. In is the fi ght against smuggling and illegal excise 2017 the Bulgarian customs reported a peak in goods. For example, the level of consumption of the quantities of seized acetic anhydride (16 128 cigarettes not intended for the Bulgarian market l). At the same time, over the last 3 years, the Bul- was 34.5% in 2010, 18.1% at the end of 2014, and garian customs offi cers detained over 23 tonnes in the last quarter of 2018 it fell to 4.4%2. Active in- of precursors Alpha-phenylacetoacetonitrile spections of excise warehouses and the transport and Piperonyl Methyl Ketone (APAAN and PMK) and delivery of excise goods such as fuels and and pre-precursors Aalpha-phenylacetoaceta- alcohol are done independently by the National mide and PMK-glycidate (APAA and PMK-glyci- Customs Agency and with the assistance of oth- date) used in the illegal manufacture of synthet- er responsible national authorities. More than 160 ic drugs from the amphetamine-derived group. million pieces of cigarettes were detained by the Bulgarian customs offi cers only during the period 2015-2018. 2.4 million liters of energy products, mainly fuels, were seized. About 700 000 liters of ethanol was seized for the period.

712 kg of heroin concealed in construction pallets – 2018, ‘Kapitan Andreevo’ BCP

After 2010 signifi cant investments in technical provision and modernization of both the avail- The Bulgarian Customs Administration contin- able technical equipment and the purchase of ues to contribute to the fi ght against counterfeit- a new one are made. The X-ray park is expand- ing and piracy, recognizing that infringement of ing with a new generation of machines capable intellectual property rights is not limited to break- of testing large-scale vehicles and loads. ing the economic interests of a group of com- In the three accredited customs laboratories, panies but also damaging consumer health and about 8000 samples of different goods are sur- safety and resulting in fi nancing of organized veyed annually, with the largest share of samples

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2 By the method of the independent international marketing research agency “Nielsen”, measures the level of illegal trade by collecting and analyzing blank cigarette packs. Funded by the „Anti-Traffi cking Initiative“ of excise goods - fuels, alcohol products, to- the working groups to the Council “Customs bacco and tobacco products. Customs labora- Cooperation” and “Customs Policy” and led to tories are also engaged in the implementation a successful conclusion of the negotiations be- of the Bulgarian and Union legislation in the fi eld tween the Council, the European Commission of drug substances’ and precursors’ control, in and the European Parliament on the text of a cooperation with the General Directorate “Joint new regulation, controlling the cash entering or Research Center” of the European Union. Within leaving the Union. just four years from 2015 to 2018, over 20 new de- The process of development of information signer drugs have been identifi ed at the Central systems of the National Customs Agency con- Customs Laboratory. tinues by building integration with other Bulgar- A radical step in the excise policy is legisla- ian administrations. Innovations contribute to tive changes, which regulate the order of move- automating processes and facilitating com- ment of excisable goods with an electronic munication between business and administra- administrative document, as well as changes tion through the provision of quality and easily related to the creation of the Bulgarian Excise accessible electronic services. Guided by the Centralized Information System - BACIS, which requirements of the Union Customs Legislation, has been implemented since 2014. The project the National Customs Agency adopts the ap- is in co-operation with the National Revenue proach of developing institutional/corporate ar- Agency and its main objective is to automate chitecture for customs processes such as Import, the processes of submission and processing of Export, Transit, Customs Debt, Guarantee (Secu- excise documents, the exchange of informa- rity) Management and Exchange of Information tion and the control of the entire chain of excise with the Community Domain. goods. In the years to come, the improvement And in the fi eld of training of customs offi c- of the national excise legislation is generally in ers, the focus is on harmonizing standards at EU three directions - cutting off the opportunities for level. As a result of the joint work of the Euro- misappropriation and evasion of excise duties; pean Commission and the Member States, a alignment with the European requirements, in- European Union Customs Competency Frame- cluding by enforced judgments of the Court of work is set up which provides a comprehensive Justice of the European Union; and, last but not understanding of the knowledge, skills and be- least, texts aimed at improving the business envi- havior required by the European Union customs ronment by reducing the administrative burden offi cer to be highly effective in their work. The and costs of economic operators. Bulgarian customs are among the fi rst adminis- The focus in the work of the Bulgarian customs trations in the European Union to introduce and is the uniform application of the EU customs leg- implement this standard. The National Customs islation. Since November 2013, when the Un- Agency implements a sustainable human re- ion Customs Code was sources policy aimed adopted, the efforts at selecting high poten- have been targeted to tial personnel, provid- prepare for its actual ing specialized training implementation in May and career develop- 2016. Priority is given to ment under clear rules using simplifi ed proce- through competitive dures in customs legis- procedures and an lation by fi nding a bal- advanced selection ance between customs system. From the begin- control and trade facili- ning of 2017, a study tation. on professional and In the fi rst half of 2018, psychological fi tness under the Bulgarian began as a separate Presidency of the Coun- stage of the proce- cil of the European Un- dures for recruitment ion, the National Cus- and promotion in the toms Agency chaired customs administration.

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