The European Commission said on June 20 that it referred Bulgaria to the European Court of Justice for failing to abolish duty and tax relief in its agreement with US.
“On its accession to the EU, Bulgaria committed to take all steps necessary to bring its existing agreements with third countries into line with EU law. This includes the bilateral agreement with the United States on technical assistance, under which Bulgaria waives customs duties and value-added tax on imports linked to US-funded assistance projects,” the EC said in a statement.
This goes beyond what is allowed under EU customs duty rules and EU VAT rules, which state that import VAT relief may be given under diplomatic arrangements in certain specific circumstances.
“For example, certain privileges and immunities are allowed when organisations are set up under international law, or when cultural, scientific or technical cooperation agreements are concluded with third countries,” the Commission said.
However, none of the tax or duty relief granted under the Bulgarian-US agreement meets these criteria, according to the EC.
In June 2012, the EC issued a reason opinion asking Bulgaria to comply with European Union law on this issue. The referral to the European Court of Justice is the final stage in EU infringement proceedings against a member state.
(European Commission headquarters, Berlaymont building. Photo: JLogan)