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Publication(Washington, DC: World Bank, 2001-07) O'Brien, Thomas ; Filipov, ChristianThe paper identifies the key elements of the regulatory environment for business in Bulgaria, to serve as a research guide, while recognizing that the rapid development of new legislative, and regulatory procedures, are greatly needed, largely to meet the European Union's (EU) legal, and regulatory standards. It describes business creation, with the Commercial Code providing much of the central, comprehensive regulation. Also, another route for business creation in the private sector has been offered through the privatization process of state-owned assets, and, the use of concessions can also be viewed as another route to the creation of private business. However, and although concession legislation sets an overall framework of reasonable adequacy, reports from practitioners in the marketplace reveal much remains to be done to forward this agenda. In regulating corporate operations, the stake of shareholders in the formation of corporate policy, reflects shared participation in the corporate capital base; thus to engender confidence in corporate management standards, and underpin the broadening of share ownership, priority actions should take place. Bulgarian competition law, follows EU doctrine, which penalizes companies for discriminatory behavior, monitored by the Commission on the Protection of Competition, with defined discretionary powers. The study further highlights accounting standards, investment channels, and the tax regime, suggesting priority actions for company transformation such as enhanced training for judges, and court administration procedures to rationalize the case load. Overall, recommendations include accurate drafting of primary legislation; quality improvement of secondary legislation, setting the pace for a timely implementation, as well as a more effective judicial system for corporate affairs, and services delivered by the public administration to businesses.
Publication(Washington, DC: World Bank, 2001-05) Garibaldi, Pietro ; Makovec, Mattia ; Stoyanova, GabriellaThis report studies the Bulgarian labor market with a view to understand the interactions between the performance of the Bulgarian economy and the functioning of its labor market. The report assesses also the position of Bulgaria vis-a-vis compliance with the "acquis communautaire," and provides a set of key policy recommendations that may enhance job creation potential in years to come. In the aftermath of a steep adjustment process, the Bulgarian labor market resembles a sclerotic market, not dissimilar from the worst performing European markets. Nevertheless, the existing labor market policies and institutions, with the exception of excessively high payroll taxes and a somewhat strict employment protection legislation, are not necessarily synonymous of labor market rigidity: unemployment support schemes are modest, the minimum wage is not high, and industrial relations systems do not appear to prevent an efficient wage dispersion across sectors. Thus, the poor performance of Bulgaria is likely to be the result of a chronic inability to restructure its old sector and to tackle fundamental structural problems. In terms of compliance with the "acquis communautaire," Bulgaria's legislation appears aligned with most of the European Union requirements in the labor area. However, the standardization of working conditions requires substantial investments and a strengthening of administrative capacity to implement EU legislation.