The Financial Supervision Commission (FSC) of Bulgaria is an independent public authority responsible for regulation and supervision of financial markets and activities in Bulgaria. It was established in 2003 to regulate non-banking financial institutions and financial markets. The FSC plays a crucial role in maintaining stability and confidence in Bulgaria’s financial system.

Overview of the Financial Supervision Commission

History and Establishment

The Financial Supervision Commission (FSC) was established in March 2003 under the Financial Supervision Commission Act. Prior to that, regulation of non-banking financial institutions was overseen by different authorities. The new unified regulatory authority was created in line with best international practices for integrated financial supervision.

The FSC took over the functions of three previously separate bodies:

  • State Insurance Supervision Agency
  • Securities and Stock Exchanges Commission
  • Supervision of Private Pension Security Companies

The establishment of a single authority aimed to improve regulation and transparency in Bulgarian financial markets.

Organizational Structure

The FSC consists of a Governing Council and specialized administrative units.

The Governing Council is the central decision-making authority responsible for regulatory policies and actions. It consists of 5 members appointed by parliament for a 6 year term.

The administrative units carry out day-to-day regulation and oversight activities. These include departments focused on insurance supervision, investment activity supervision, pension schemes supervision, internal control, international cooperation, administration, etc.

The FSC has a central office in Sofia and regional offices in bigger cities. As of 2018, it had over 300 employees.

Objectives and Responsibilities

The FSC has broad regulatory and supervisory powers with the main objectives to:

  • Maintain stability and soundness of financial markets
  • Protect investors and consumers
  • Prevent market manipulation and unfair trade practices
  • Improve transparency and information disclosure

Its primary responsibilities are to:

  • Issue and revoke licenses of supervised entities
  • Monitor compliance and sanction violations
  • Set standards for capital adequacy, reserves, risk management etc.
  • Regulate disclosure requirements and reporting
  • Cooperate with domestic and foreign regulators

By ensuring well-functioning financial markets, the FSC promotes investment activity and economic growth in Bulgaria.

Regulated Sectors

The FSC is responsible for regulation and supervision of the following non-banking financial sectors:

Insurance Market

This includes supervision of:

  • Insurance companies
  • Reinsurance companies
  • Insurance brokers and agents
  • Voluntary health insurance companies

Key activities include licensing, approving products and premiums, solvency and reserve requirements, consumer protection measures, and preventing unfair market practices.

Investment Intermediaries

This covers supervision of:

  • Brokerage companies
  • Management companies
  • Investment advisors
  • Mutual funds

Key activities include oversight of portfolio management, corporate governance, conflict of interest rules, capital adequacy, and transparency requirements.

Collective Investment Schemes

This includes regulation of undertakings for collective investment such as:

  • Mutual funds
  • Alternative investment funds
  • Real estate investment trusts
  • Securitization vehicles

Key activities focus on governance, risk management, assets segregation, disclosure standards, and consumer protection.

Pension Insurance Companies

This covers supervision of:

  • Supplementary mandatory pension funds
  • Supplementary voluntary pension funds
  • Occupational pension schemes

Key activities include capital, reserve and investment requirements, governance standards, transparency, and protecting pension assets.

Supplementary Supervision

The FSC also has some supplementary supervisory functions for other entities such as:

  • Financial institutions
  • Public companies
  • Central depository
  • Exchanges
  • Rating agencies

This includes oversight of reporting, governance, auditing and disclosure standards.

Main Activities and Powers

The FSC undertakes various regulatory activities and has extensive supervisory powers including:


  • Issues, suspends and revokes operating licenses of regulated entities like insurers, brokers, pension funds etc.
  • Approves major shareholders, management board members, and key operations
  • Sets criteria for licensing like minimum capital, risk management procedures, reporting systems

Supervision of Activities

  • Monitors day-to-day operations and conducts inspections
  • Collects regular statements, reports and disclosures
  • Performs financial audits and probes to check compliance
  • Detects and punishes violations of regulations


  • Issues rules, instructions and guidelines to regulated entities
  • Sets standards for accounting, auditing, reporting, governance, risk management, reserves, solvency etc.
  • Constrains concentration risk, connected lending, conflict of interest
  • Regulates investment criteria, asset valuation, interest rates, fees

Cooperation with Other Authorities

  • Exchanges information and coordinates with central bank, ministry of finance and other regulators
  • Provides assistance to foreign supervisors of cross-border financial groups
  • Participates in international organizations like EU, IAIS, IOSCO, ESMA, EIOPA
  • Negotiates cooperation agreements for exchange of information

Challenges and Future Developments

Going forward some of the major challenges and areas of focus for the FSC include:

  • Adapting regulations to emerging trends like financial technologies, digitalization, and crypto-assets
  • Strengthening consumer protection regulations for increased transparency and fraud prevention
  • Enhancing risk-based supervision and ensuring adequate capital and liquidity
  • Promoting competitiveness of local financial markets and integration into EU markets
  • Developing financial education and inclusion initiatives for broader stakeholder protection
  • Recruiting highly skilled professionals across various financial specialties
  • Improving exchange of information and coordination with other domestic and foreign regulators
  • Implementing effective internal controls and governance structures
  • Harnessing technology and automation for more efficient analytics, monitoring, and compliance processes
  • Balancing greater regulatory harmonization globally while accounting for unique local market risks and conditions

By addressing these challenges, the FSC can maintain smooth functioning, stability and integrity of Bulgaria’s financial system amidst rapidly evolving conditions.


In summary, the Financial Supervision Commission plays a critical role in overseeing Bulgaria’s insurance sector, investment intermediaries, pension funds, and capital markets. Using tools like licensing, supervision, regulations and cooperation it ensures market stability and order, protects consumers, and promotes transparency and good governance. As Bulgaria’s financial landscape continues to develop, the FSC will need to remain vigilant and proactive to harness innovations while curbing emerging risks and threats. With robust regulation that balances oversight with competitiveness, Bulgaria’s non-banking financial system can thrive and fuel economic prosperity.