Regulation No. 48 of 20.03.2013 on the Requirements for Remuneration

REGULATION No. 48 of 20.03.2013 on the Requirements for Remuneration Promulgated - SG, issue 32 of 02.04.2013; amended and supplemented, issue 41 of 21.05.2019; amended, issue 66 of 20.08.2019; amended and supplemented, issue 61 of 10.07.2020; amended, issue 60 of 20.07.2021; amended and supplemented, issue 64 of 03.08.2021; amended, issue 70 of 20.08.2024; amended and supplemented, issue 39 of 28.04.2026; amended and supplemented, issue 73 of 14.08.2026, effective from 01.01.2027. Adopted by Decision No. 140-N of 20.03.2013 of the FSC.

Section I
General Provisions

Art. 1. (Amended - SG, issue 41 of 2019; amended and supplemented, issue 61 of 2020) (1) (Amended - SG, issue 41 of 2019; amended, issue 61 of 2020) This regulation defines the principles and requirements for the policy and practice of determining and paying remuneration in insurers, reinsurers, and supplementary social security companies licensed to operate under the Insurance Code and the Social Security Code, respectively. (2) (New - SG, issue 61 of 2020) This regulation defines the principles and requirements for the policy and practice of determining and paying remuneration in management companies licensed to operate under the Collective Investment Schemes and Other Collective Investment Undertakings Act. (3) (Previous para. 2, amended - SG, issue 61 of 2020) This regulation defines the principles and requirements for the policy and practice of determining and paying remuneration to members of the management and control bodies of public companies. (4) (New - SG, issue 61 of 2020) Public companies that are credit institutions, investment intermediaries, insurers, reinsurers, supplementary social security companies, and management companies shall, in addition to the sectoral requirements regarding the policy and practice for determining and paying remuneration to members of their management and control bodies, also apply the requirements of Section III, respectively. The first sentence shall not apply in case of a conflict between sectoral requirements and the requirements of Section III.

Section II
Remuneration Policy in Insurers, Reinsurers, Supplementary Social Security Companies, Management Companies (Title amended - SG, issue 61 of 2020)

Art. 2. (Amended and supplemented - SG, issue 41 of 2019; amended, issue 61 of 2020; amended, issue 60 of 2021; amended and supplemented, issue 64 of 2021; amended, issue 73 of 2026, effective from 01.01.2027) (1) The persons under Art. 1, para. 1 shall adopt and apply a policy covering all forms of remuneration, such as salaries and other financial and/or material incentives, including benefits related to voluntary pension and/or health insurance, for the following categories of personnel:

1. employees in managerial positions;
2. employees whose activities involve risk-taking;
3. the responsible actuary and actuaries;
4. employees performing control functions;
5. (amended - SG, issue 41 of 2019; amended, issue 61 of 2020; amended, issue 60 of 2021; amended, issue 73 of 2026, effective from 01.01.2027) all other employees whose remuneration is comparable to the remuneration of employees under item 1 and 2 and whose activities influence the risk profile of a person under Art. 1, para. 1, and in the case of supplementary social security companies - also the risk profile of the managed funds or sub-funds therein.
   (2) (New - SG, issue 41 of 2019) The remuneration policies of supplementary social security companies shall also cover:
6. (amended - SG, issue 73 of 2026, effective from 01.01.2027) persons performing the functions under Art. 123e, para. 7, items 1, 3 and 5 of the Social Security Code;
7. (amended - SG, issue 73 of 2026, effective from 01.01.2027) employees whose professional activities have a significant impact on the risk profile of the companies, the managed funds and sub-funds therein.
   (3) (New - SG, issue 64 of 2021) Employees performing control functions in the insurer, respectively in the reinsurer, within the meaning of para. 1, item 4, are the persons who manage the functions under Art. 78, para. 1, items 1 - 3 of the Insurance Code, and the employees in the units performing these functions. The remuneration policy of the insurer, respectively of the reinsurer, shall define the positions of employees who may have a significant impact on the risk profile of the undertaking under para. 1, item 5, or shall contain a methodology for their determination. (4) (Previous para. 2 - SG, issue 41 of 2019; previous para. 3, issue 64 of 2021) The remuneration policy shall be developed by the management or control bodies in cooperation with the internal control department and, where appropriate, with human resources experts who possess the necessary qualifications and functional independence, in order to ensure an objective assessment of the appropriateness of the remuneration policy, including its implications for risk and risk management.

Art. 3. (Amended and supplemented - SG, issue 41 of 2019; amended and supplemented, issue 61 of 2020) (1) (Amended - SG, issue 41 of 2019; amended, issue 61 of 2020) The Supervisory Board or the Board of Directors, respectively the Control Board, of the person under Art. 1, para. 1 shall adopt the remuneration policy and shall be responsible for its implementation and periodic review. (2) The implementation of the remuneration policy shall be subject to a periodic and independent internal review at least once a year by or with the participation of the specialized internal control department. (3) (Amended - SG, issue 41 of 2019; amended, issue 61 of 2020) The remuneration policy must be clear and documented and must be available to the persons under Art. 2, para. 1 and 2 to whom it applies. (4) (New - SG, issue 41 of 2019) Insurers and reinsurers shall ensure that all their employees are familiar with the remuneration policy.

Art. 4. (Amended and supplemented - SG, issue 41 of 2019; amended and supplemented, issue 64 of 2021; amended, issue 70 of 2024; amended, issue 73 of 2026, effective from 01.01.2027) (1) The remuneration policy must:

1. promote prudent and effective risk management and not encourage risk-taking exceeding an acceptable level;
2. be consistent with the company's business strategy (activity programs, rules and policies), objectives, values and long-term interests;
3. provide for measures to avoid conflicts of interest;
4. (amended - SG, issue 41 of 2019) be consistent with the principles and good practices for protecting the interests of insurance service consumers, clients of management companies and investors in collective investment schemes, respectively.
   (2) (New - SG, issue 41 of 2019; amended, issue 70 of 2024; amended, issue 73 of 2026, effective from 01.01.2027) The remuneration policy of supplementary social security companies must meet the requirements of para. 1, items 1 - 3 and be consistent with the performance, financial stability and risk profiles of the company, the funds and sub-funds managed by it, and with the long-term interests of insured persons, persons insured under PEPP, pensioners and PEPP beneficiaries. (3) (New - SG, issue 64 of 2021) The remuneration policy of insurers and reinsurers must meet the requirements of para. 1, items 1 - 4, whereby for the purposes of item 1, "acceptable level" is determined according to the risk management policies and the risk-taking limits provided therein, including in relations with service providers. The remuneration policy cannot jeopardize the ability of the insurer, respectively the reinsurer, to maintain the necessary own funds. (4) (New - SG, issue 64 of 2021) The insurer, respectively the reinsurer, shall ensure that the measures to avoid conflicts of interest under para. 1, item 3 cover at least:
5. persons who develop the remuneration policy, who approve or review it, as well as who prepare, conclude or review agreements regarding remuneration;
6. persons who conclude or underwrite insurance or reinsurance contracts that may significantly affect the risk profile of the insurer or reinsurer;
7. asset managers.
   (5) (Previous para. 2 - SG, issue 41 of 2019; previous para. 3, issue 64 of 2021) The remuneration policy shall be updated in accordance with market changes and the financial condition of the person under Art. 1, para. 1.

Art. 4a. (New - SG, issue 64 of 2021) (1) The insurer, respectively the reinsurer, which is a participating undertaking, the insurance holding company or the mixed-activity financial holding company, shall adopt a remuneration policy for the entire group, and the policy must reflect the complexity and structure of the group for uniform and consistent application across the group in accordance with the group's risk management strategies. The policy shall apply to all persons at group level and to each individual undertaking. (2) The insurer, respectively the reinsurer, which is a participating undertaking, the insurance holding company or the mixed-activity financial holding company, must ensure that:

1. there is a mutual linkage of remuneration policies within the group and their compliance with legal and regulatory requirements for the undertakings that are part of it, and they are applied correctly;
2. all undertakings in the group comply with legal and regulatory requirements regarding remuneration;
3. conditions are created for managing significant risks at group level related to the application of the remuneration policy within the group.

Art. 5. (Amended - SG, issue 41 of 2019; amended, issue 61 of 2020; amended, issue 39 of 2026) (1) The persons under Art. 1, para. 1 may pay both fixed and variable remuneration, and the remuneration policy shall define the appropriate ratio between fixed and variable remuneration depending on the category of personnel and a maximum upper limit for variable remuneration for each category of personnel. (2) (Amended - SG, issue 61 of 2020) Fixed remuneration must represent a sufficiently large part of the total remuneration to allow for a flexible variable remuneration policy, including the possibility of not being paid, in cases where any of the following circumstances exist:

1. pre-defined criteria and indicators in the remuneration policy have not been met;
2. there is a significant deterioration in the financial condition of the person under Art. 1, para. 1, especially in cases where, as a result, a cessation of activity can be expected;
3. extraordinary circumstances have occurred leading to significant risk to the financial stability or other long-term interests of the person under Art. 1, para. 1.
   (3) (Amended - SG, issue 41 of 2019; amended, issue 39 of 2026) When, within one year, a person under Art. 2, para. 1 and 2 is determined a variable remuneration exceeding one-third of the gross annual remuneration, no less than 40% of the variable remuneration shall be deferred for a period with a minimum duration of three years, depending on the economic cycle, the nature of the activity of the person under Art. 1, para. 1 and the risks arising therefrom, as well as the position of the respective employee. (4) (Amended - SG, issue 41 of 2019) The remuneration policy shall provide that persons under Art. 2, para. 1 and 2 must return in full or in part variable remuneration paid on the basis of data that subsequently proved to be incorrect or misleading. Clauses shall be included in the contracts of persons under Art. 2, para. 1 and 2 to guarantee the return of variable remuneration. (5) The provision of deferred variable remuneration shall be carried out proportionally or through gradual increase over the deferral period. The deferred part of the remuneration may consist of shares, options, cash or other means. The criteria for assessing future performance, to which the deferred part is linked, must allow for its adjustment according to current and future risks. (6) Compensation related to early termination of a contract must reflect the performance achieved over time by the respective persons and be determined in such a way as not to reward failure.

Art. 6. (Amended - SG, issue 41 of 2019; amended, issue 61 of 2020; amended, issue 60 of 2021; supplemented, issue 64 of 2021; amended, issue 73 of 2026, effective from 01.01.2027) (1) (Amended - SG, issue 41 of 2019; amended, issue 61 of 2020; amended, issue 60 of 2021; amended, issue 73 of 2026, effective from 01.01.2027) Variable remuneration shall be linked to performance through a combination of assessments of the employee's work, the respective structural unit, and the person under Art. 1, para. 1, and for supplementary social security companies - also of the managed funds or sub-funds therein. (2) (Supplemented - SG, issue 64 of 2021) The assessment of the employee's work shall be based on financial and non-financial indicators, and in the case of an employee of an insurer, respectively a reinsurer - also on compliance with risk management rules and the regulatory framework and internal acts of the insurer, respectively the reinsurer. (3) The assessments under para. 1 shall cover a period of several years, so that the assessment process is based on long-term performance and the payment of variable remuneration is distributed over a period taking into account the economic cycle and the risks undertaken by the person under Art. 1, para. 1. (4) The assessment of performance used in forming variable remuneration and its distribution must take into account all current and future risks, the cost of capital, and the necessary liquidity.

Art. 7. (1) The head and employees of the specialized internal control department and other employees performing control functions:

1. have appropriate powers and are independent of the structural units they control;
2. receive their remuneration according to the degree of achievement of the objectives related to these functions, regardless of the results of the controlled structural units.
   (2) The responsible actuary and actuaries shall receive remuneration in a manner consistent with their role and contribution, and not dependent on the results of the respective supplementary social security company, insurer or reinsurer.
   (3) Compliance with the remuneration policy with respect to the persons under para. 1 and 2 shall be directly monitored by the remuneration committee, and where such a committee is not established - by the supervisory board, the independent members of the board of directors or by the control board.

Art. 8. (Amended - SG, issue 41 of 2019) (1) (Amended - SG, issue 41 of 2019) Each person under Art. 1, para. 1 shall establish a procedure for informing employees under Art. 2, para. 1 and 2 regarding the remuneration policy in the part that applies to them. Where necessary, clauses shall be included in the contracts of these employees to guarantee the application of the remuneration policy. (2) (Amended - SG, issue 41 of 2019) The criteria and procedures for evaluation and changes thereto shall be drawn up in writing and brought to the attention of the respective persons under Art. 2, para. 1 and 2 upon taking up the respective position and upon any subsequent change.

Art. 9. (Amended - SG, issue 41 of 2019; amended, issue 61 of 2020; amended, issue 39 of 2026) (1) (Amended - SG, issue 41 of 2019; amended, issue 61 of 2020; amended, issue 39 of 2026) The persons under Art. 1, para. 1 shall disclose information regarding the remuneration policy and any subsequent change thereto in a clear and accessible manner. (2) The disclosure of information under para. 1 may be in the form of a separate statement, periodic disclosure in the annual financial statements or in another appropriate form. (3) The following information shall be disclosed:

1. the decision-making process used to determine the remuneration policy, including, if applicable, information regarding the composition and mandate of the remuneration committee, the name of the external consultant whose services were used to determine the remuneration policy, and the role of the relevant stakeholders;
2. the link between pay and performance achieved;
3. the criteria used to measure performance and account for risk;
4. the performance criteria on which the right to receive shares, options and variable elements of remuneration is based;
5. the main parameters and justification of the scheme for possible annual cash bonuses and other benefits, other than cash.

Art. 10. (Amended - SG, issue 61 of 2020) Management companies licensed to operate under the Collective Investment Schemes and Other Collective Investment Undertakings Act shall apply, respectively, Art. 2, para. 3, Art. 3, para. 3, Art. 4, para. 1, item 4, Art. 5, para. 1 - 5, Art. 6, para. 4, Art. 7, para. 3 and Art. 8 - 10.

Section III
Remuneration Policy for Members of Management and Control Bodies of Public Companies

Art. 11. (Amended and supplemented - SG, issue 61 of 2020; amended, issue 39 of 2026) (1) (Amended and supplemented - SG, issue 61 of 2020) The public company shall adopt and apply a remuneration policy for the members of the management and control bodies of the company in accordance with Art. 116v, para. 1 of the Public Offering of Securities Act (POSA). The public company shall pay remuneration only in accordance with the remuneration policy adopted by the general assembly. (2) The remuneration policy shall be developed by the supervisory board, respectively by the board of directors of the public company with the assistance of the remuneration committee, where such a committee is established. (3) (Amended - SG, issue 61 of 2020) Proposals for the adoption of a remuneration policy, for amendments and/or supplements thereto or for its review shall be included as a separate item on the agenda of the general assembly of the public company, announced in the invitation under Art. 115, para. 2 of the POSA, and shall be adopted by the general assembly of shareholders. (4) (New - SG, issue 61 of 2020) The public company shall review the remuneration policy at least once every 4 years, as well as when significant amendments and/or supplements thereto are necessary or this is necessary to achieve the objectives under para. 8. (5) (New - SG, issue 61 of 2020) Until the adoption of a remuneration policy or when the general assembly does not adopt the proposed policy, the public company shall pay remuneration to the members of its management and control bodies in accordance with its existing practice. In these cases, the management board of the public company is obliged to submit a policy, respectively a revised policy, for adoption at the next general assembly. (6) (New - SG, issue 61 of 2020) When there is an adopted remuneration policy and the general assembly does not adopt the proposed amendments and/or supplements thereto, respectively the proposed new policy, the public company shall continue to pay remuneration to the members of its management and control bodies in accordance with the adopted policy. In these cases, the management board of the public company is obliged to submit revised amendments and/or supplements thereto, respectively a revised new policy, for adoption at the next general assembly. (7) (Previous para. 4, amended - SG, issue 61 of 2020; amended, issue 39 of 2026) The public company is obliged to disclose its remuneration policy and any subsequent change thereto. The adopted remuneration policy, with its adoption date and effective date specified therein, and the results of the general assembly vote shall be immediately published on the company's website and shall be freely accessible at least while it is in force. (8) (New - SG, issue 61 of 2020) The remuneration policy must:

1. contribute to the achievement of business objectives and be consistent with the long-term interests and sustainability of the company;
2. contain information on how the company will achieve the objectives under item 1;
3. be clear and understandable, describe the components of fixed and variable remuneration, including all bonuses and all other benefits in any form that may be provided to the members of the management and control bodies of the company, and indicate their relative share.
   (9) (New - SG, issue 61 of 2020) The remuneration policy shall describe how the remuneration and working conditions of the company's employees are taken into account when developing the remuneration policy for the members of the company's management and control bodies.
   (10) (New - SG, issue 61 of 2020) The remuneration policy shall include information on the deferral periods for variable remuneration, including the conditions under which the company may request the return of paid variable remuneration.
   (11) (New - SG, issue 61 of 2020) Where share-based remuneration is provided, the remuneration policy shall contain a description of how share-based remuneration contributes to the achievement of the objectives under para. 8, the vesting period and, where applicable, the conditions for retaining shares after their acquisition.

(12) (New - SG, issue 61 of 2020) The remuneration policy shall include a description of the decision-making process used for its determination, review, and implementation, including measures to prevent or manage conflicts of interest, and where applicable - the role of the remuneration committee or other committees in the company. In case of amendments and/or additions to the remuneration policy, it shall include a description and explanation of the significant changes and how the results of the shareholders' general meeting votes, the opinions of the shareholders, and the minutes of the general meetings at which the remuneration policy was considered and voted on have been taken into account.

(13) (New - SG, issue 61 of 2020) The remuneration policy may specify extraordinary circumstances under which the company may temporarily not apply part of the policy. The extraordinary circumstances referred to in the first sentence are circumstances where the non-application of part of the policy is necessary and is related to the long-term interests and sustainability of the public company or its viability. In this case, as per the first sentence, the remuneration policy shall provide for under what procedural conditions and which of its components may temporarily not be applied.

Art. 12. (Amended and supplemented - SG, issue 61 of 2020.) (1) (Supplemented - SG, issue 61 of 2020) The public company discloses to its shareholders the manner in which it applies the remuneration policy in a report on the implementation of the policy, which is a separate document to the annual financial report on the company's activities.

(2) (Supplemented - SG, issue 61 of 2020) The report pursuant to para. 1 contains a program for the implementation of the remuneration policy for the next financial year or for a longer period, a review of the manner in which the remuneration policy has been applied during the year, including all benefits in any form that have been provided or owed to current and former members of the management or supervisory body, with emphasis on the significant changes adopted therein compared to the previous financial year.

(3) (New - SG, issue 61 of 2020) Any shareholder or his representative participating in the regular general meeting may make recommendations regarding the report pursuant to para. 1. If recommendations are made, the company shall indicate in the subsequent report pursuant to para. 1 how the recommendations were taken into account.

(4) (Previous para. 3, amended - SG, issue 61 of 2020) After the holding of the general meeting at which the annual financial report was approved, the public company publishes the report pursuant to para. 1 on its website, which is freely accessible for a period of 10 years. The public company may decide to keep the report available to the public after the period specified in the first sentence, provided that the personal data of the members of the management and supervisory bodies of the company are deleted.

(5) (New - SG, issue 61 of 2020) After the expiration of the period pursuant to para. 4, first sentence, the personal data of the members of the management and supervisory bodies of the company contained in the report pursuant to para. 1 shall not be disclosed, unless a longer period is provided by law.

(6) (New - SG, issue 61 of 2020) The public company does not include in the report pursuant to para. 1 special categories of personal data of the members of the management and supervisory bodies of the company within the meaning of Art. 9, paragraph 1 of Regulation (EU) 2016/679 of the European Parliament and of the Council of 27 April 2016 on the protection of natural persons with regard to the processing of personal data and on the free movement of such data and repealing Directive 95/46/EC (General Data Protection Regulation) (OJ, L 119/1 of 4 May 2016) or personal data relating to the family status of these persons. The company processes the personal data of the persons included in the report pursuant to para. 1 for the purpose of increasing corporate transparency regarding their remuneration and with a view to increasing the accountability of these persons and the supervision of their remuneration by shareholders.

Art. 13. (Amended and supplemented - SG, issue 61 of 2020; amended and supplemented, issue 39 of 2026.) The report pursuant to Art. 12, para. 1 shall contain at least:

1. information regarding the decision-making process in determining the remuneration policy, including, if applicable, information on the mandate and composition of the remuneration committee, the names of external consultants whose services were used in determining the remuneration policy;

2. information regarding the relative weight of variable and fixed remuneration of the members of the management and supervisory bodies;

3. information regarding the performance criteria upon which share options, shares of the company, or other types of variable remuneration are provided and an explanation of how the criteria pursuant to Art. 14, paras. 2 and 3 contribute to the long-term interests of the company;

4. explanation of the methods applied to assess whether the performance criteria have been met;

5. explanation regarding the dependence between remuneration and achieved results;

6. the main payments and justification of the annual bonus scheme and/or all other non-monetary additional remuneration;

7. (amended - SG, issue 61 of 2020) description of the main characteristics of the additional voluntary pension insurance scheme and information regarding the paid and/or owed contributions by the company for the benefit of the respective member of the management or supervisory body for the corresponding financial year, where applicable;

8. information regarding the deferral periods for the payment of variable remuneration;

9. information regarding the severance policy;

10. information regarding the period during which shares cannot be transferred and share options cannot be exercised, for variable remuneration based on shares;

11. information regarding the policy to retain a certain number of shares until the end of the term of office of the members of the management and supervisory bodies after the expiration of the period pursuant to item 10;

12. (supplemented - SG, issue 39 of 2026) information regarding the contracts of the members of the management and supervisory bodies, including the duration of each contract, the notice period for its termination, and details regarding severance and/or other payments due in case of early termination;

13. the full amount of remuneration and other material incentives of the members of the management and supervisory bodies for the corresponding financial year;

14. information regarding the remuneration of any person who has been a member of the management or supervisory body of a public company for a certain period during the corresponding financial year:
    a) the full amount of the paid and/or accrued remuneration of the person for the corresponding financial year; b) the remuneration and other material and non-material incentives received by the person from companies of the same group; c) remuneration received by the person in the form of profit distribution and/or bonuses and the grounds for their provision; d) all additional payments for services provided by the person outside his usual functions, when such payments are permissible according to the contract concluded with him; e) the paid and/or accrued severance allowance upon termination of his functions during the last financial year; f) a general assessment of all non-monetary benefits equated to remuneration, outside those mentioned in letters "a" - "d"; g) information regarding all loans provided, payments of social and household expenses, and guarantees from the company or its subsidiaries or other companies that are subject to consolidation in its annual financial report, including data on the remaining unpaid portion and interest;

15. information regarding shares and/or share options and/or other incentive schemes based on shares:
    a) the number of share options offered or shares provided by the company during the corresponding financial year and the conditions under which they were offered, respectively provided; b) the number of share options exercised during the corresponding financial year and for each of them, the number of shares and the exercise price of the option or the value of the interest under the share-based incentive scheme at the end of the financial year; c) the number of unexercised share options at the end of the financial year, including data regarding their price and exercise date and significant conditions for exercising the rights; d) any changes in the terms and conditions of existing share options accepted during the financial year. d) (new - SG, issue 39 of 2026) the main conditions for exercising the rights under the shares and/or options thereon, which have not been exercised by the end of the financial year;

16. (new - SG, issue 61 of 2020; amended, issue 39 of 2026) annual change in remuneration, the company's results, and the average size of full-time employee remuneration in the company, who are not members of the management and supervisory bodies, over the previous at least five financial years, presented together in a manner that allows comparison;

17. (new - SG, issue 61 of 2020) information regarding the exercise of the possibility to request the return of variable remuneration;

18. (new - SG, issue 61 of 2020) information regarding all deviations from the procedure for the implementation of the remuneration policy in connection with extraordinary circumstances pursuant to Art. 11, para. 13, including an explanation of the nature of the extraordinary circumstances and specifying the specific components that were not applied.

Art. 14. (Amended and supplemented - SG, issue 39 of 2026.) (1) The public company may pay to the members of the management and supervisory bodies both fixed and variable remuneration.

(2) The payment of variable remuneration is carried out in accordance with objective and measurable performance criteria, previously determined by the company in the remuneration policy.

(3) (Amended and supplemented - SG, issue 39 of 2026) The performance criteria for activity should promote the stability of the company in the long term and should include financial and non-financial indicators that are relevant for the long-term activity of the company, such as compliance with applicable rules and procedures.

(4) (New - SG, issue 39 of 2026) The remuneration policy clarifies how the criteria pursuant to para. 3 contribute to achieving the objectives pursuant to Art. 11, para. 8, item 1 and specifies the methods that should be applied to determine to what extent the achieved results have fulfilled the objectives.

(5) (Previous para. 4 - SG, issue 39 of 2026) Fixed remuneration must constitute a sufficiently large part of the total amount of remuneration so as to allow the application of a flexible policy by the company regarding variable remuneration, including the possibility not to pay it when the performance criteria are not met, as well as when there is a significant deterioration in the financial condition of the company.

Art. 15. (1) With the aim of achieving stable financial results, the payment of no less than 40% of the variable remuneration is deferred for a period of time determined in the remuneration policy, but not shorter than 3 years. The company determines what part of the variable remuneration to defer depending on the relative weight of variable remuneration compared to fixed remuneration.

(2) The payment of the deferred part of the variable remuneration is carried out proportionally or through gradual increase during the deferral period. The company has the right to adjust its size in accordance with the actually achieved results, for which it shall notify the affected person in due time.

Art. 16. (Amended and supplemented - SG, issue 61 of 2020; amended and supplemented, issue 39 of 2026.) (1) The contract with a member of the board of directors, respectively an executive member of the board of directors, of a public company must include provisions that allow the company to require the return of variable remuneration provided based on data that subsequently turned out to be incorrect. The decision to return the variable remuneration is taken by the general meeting of shareholders, which determines the conditions and deadline for return, if they are not defined in the contract.

(2) (Amended and supplemented - SG, issue 61 of 2020; amended and supplemented, issue 39 of 2026) The remuneration policy contains information regarding the contracts of the members of the management and supervisory body, including the duration of each contract and the notice period for its termination, and regulates the conditions and maximum amount of any severance payments upon termination of contracts with a member of the management or supervisory body, in connection with their early termination, payments related to the notice period or provided for in the clause prohibiting competitive activity, as well as the main characteristics of the additional voluntary pension insurance scheme, where applicable.

(3) The total amount of severance pursuant to para. 2 should not exceed the sum of the paid annual fixed remuneration of the person for 2 years.

(4) The remuneration policy should explicitly provide that severance pursuant to para. 2 is not due if the termination of the contract is due to unsatisfactory results and/or culpable behavior of the member of the board of directors, respectively the executive director.

Art. 17. (1) When public companies provide variable remuneration in the form of shares, the transfer of shares to the ownership of the members of the management and supervisory bodies is carried out no earlier than three years after the date of the decision to provide them. Share options and all other rights to acquire shares or to receive remuneration based on changes in share prices cannot be exercised for at least three years after their provision.

(2) The transfer of shares and the right to exercise share options or other types of rights to acquire shares or to receive remuneration depending on changes in share prices must depend on previously determined and measurable performance criteria.

(3) The remuneration of members of the supervisory board, respectively members of the board of directors, who are not executive members, cannot include share options.

Art. 18. (Amended and supplemented - SG, issue 61 of 2020.) (1) The decision to provide members of the management and supervisory bodies with remuneration in the form of shares of the company, share options, or other rights to acquire shares or remuneration based on changes in the price of the company's shares must be previously approved by the general meeting of shareholders. The approval of the general meeting must be for the specific share-based remuneration scheme that the company will provide to the members of the management and supervisory bodies, without the need for approval for the remuneration of each member of the management or supervisory body.

(2) Approval pursuant to para. 1 is required for the following:

1. (amended - SG, issue 61 of 2020) provision of share-based remuneration of the company, including share options;

2. determination of the maximum number of shares subject to such remuneration, and the order of their provision;

3. the period during which options can be exercised;

4. the conditions for any subsequent change in the exercise price of options, if such a change is possible and permissible;

5. other long-term forms of incentive that are acceptable for the members of the management and supervisory bodies and are not applied under similar conditions for other employees of the company.

6. (new - SG, issue 61 of 2020) the vesting period and, where applicable - the retention conditions for shares after acquisition.

(3) The general meeting of shareholders must determine the period during which the members of the management and supervisory bodies of the company may be provided with share-based remuneration.

(4) Any significant change in the terms and conditions of the share-based remuneration scheme must be previously approved by a resolution of the general meeting of shareholders of the company, at which information is provided regarding all conditions of the proposed change, including its effect.

(5) A public company without prior approval from the general meeting of shareholders cannot provide to the members of the management and supervisory bodies an option to subscribe for shares at a price lower than the market price of the shares on the date on which the price is determined, or at an average price for a certain number of days preceding the date on which the exercise price of the option is determined, if the provision of such options is permissible by law or according to the articles of association of the company.

(6) Paras. 1 - 4 do not apply to share-based remuneration schemes approved by the general meeting of shareholders, in which employees of the company or employees of its subsidiary participate under similar conditions.

Art. 19. (1) The materials for the general meeting of shareholders in connection with the decision pursuant to Art. 18, para. 1 must contain:

1. a full description of the share-based remuneration scheme of the company and the names of the persons who will participate in it, as well as its application within the remuneration policy;

2. the manner in which the company will secure the shares that it undertakes to provide to the members of the management and supervisory bodies, explicitly stating whether the company will buy them, whether it owns them, or will issue new shares;

3. a review of the costs of the company for the provision of share-based remuneration.

(2) The decision of the general meeting of shareholders pursuant to Art. 18, para. 1 must contain a full description of the share-based remuneration scheme of the company.

Art. 20. (1) The public company may create a remuneration committee, whose members are elected by the general meeting of shareholders among the members of the supervisory board of the company, respectively the board of directors, if they are not executive members.

(2) The remuneration committee consists of at least three persons, with at least half of the members of the remuneration committee being independent within the meaning of Art. 116a, para. 2 of the Public Offering of Securities Act.

(3) At least one of the members of the remuneration committee must have knowledge and experience in the field of remuneration policy.

Art. 21. (Amended - SG, issue 61 of 2020.) (1) (Amended - SG, issue 61 of 2020) The remuneration committee, when such is created:

1. prepares and proposes to the supervisory board, respectively the board of directors, for approval:
   a) the remuneration policy for the members of the board of directors, respectively the executive directors from the board of directors, which should cover all forms of benefits, including fixed remuneration, their remuneration schemes, and payments related to the termination of their contracts; b) the individual remuneration of the members of the board of directors, respectively the executive directors from the board of directors, in accordance with the company's remuneration policy and the evaluation of the executive director's work;

2. makes recommendations to the board of directors, respectively the executive directors from the board of directors, in determining the remuneration of employees in other managerial positions in the administration of the public company;

3. monitors the level and structure of remuneration of employees in other managerial positions in the administration of the public company based on information provided by the board of directors, respectively the executive directors from the board of directors.

(2) In performing its functions, the remuneration committee may use the services of a consultant for the purpose of obtaining information regarding market standards for remuneration systems.

(3) When the public company does not create a remuneration committee, the body that develops the remun policy applies correspondingly para. 1 and 2 and Art. 22.

Art. 22. (Amended - SG, issue 61 of 2020.) (1) (Amended - SG, issue 61 of 2020) The remuneration committee, when such is created, at least once a year reviews the policy regarding the remuneration of the members of the board of directors, respectively the executive directors from the board of directors, including the policy regarding share-based remuneration and its implementation.

(2) The remuneration committee must exercise its functions independently and in good faith.

(3) With a view to ensuring the receipt of objective consultations, the remuneration committee may use the services of a consultant who is not engaged in providing consultations to the human resources department or the members of the board of directors, respectively the executive directors from the board of directors of the company. The remuneration of the consultant cannot exceed 70 percent of the remuneration of a member of the management

council, respectively of an executive member of the board of directors of the company.
(4) In exercising its functions, the remuneration committee shall ensure that the remuneration of each member of the management board, respectively of each executive member of the board of directors, is fairly determined in relation to the remuneration of the other members of the management board, respectively executive directors of the board of directors and other employees in management positions in the administration of the public company. (5) The remuneration committee reports on the exercise of its functions to the general meeting of shareholders, and for this purpose its members, after a decision of the general meeting, shall be allowed to attend the meeting.

Section III "a"
(New - SG, issue 39 of 2026)
European Single Access Point
Art. 22a. (New - SG, issue 39 of 2026) The Financial Supervision Commission, hereinafter referred to as "the Commission", is a data collection body within the meaning of Art. 2, item 2 of Regulation (EU) 2023/2859 of the European Parliament and of the Council of 13 December 2023 establishing a European single access point providing centralized access to publicly available information relevant to financial services, capital markets and sustainable development (OJ, L 2023/2859 of 20 December 2023), hereinafter referred to as "Regulation (EU) 2023/2859", for the purpose of ensuring access through the European single access point to the information under Art. 11, para. 7 and Art. 12, para. 4. Art. 22b. (New - SG, issue 39 of 2026) (1) The public company, simultaneously with the publication of the information under Art. 11, para. 7 and Art. 12, para. 4, provides the same information to the Commission in a data extractable format under Art. 2, item 3 of Regulation (EU) 2023/2859 or, where required by European Union law, in a machine-readable format under Art. 2, item 4 of the same regulation, accompanied by the following metadata:

1. name of the public company to which the information relates;
2. legal entity identifier of the public company;
3. size of the public company according to the category under Art. 7, paragraph 4, letter "d" of Regulation (EU) 2023/2859;
4. industrial sectors of the economic activities of the public company under Art. 7, paragraph 4, letter "e" of Regulation (EU) 2023/2859;
5. type of information, as classified under Art. 7, paragraph 4, letter "c" of Regulation (EU) 2023/2859;
6. indication whether the information contains personal data.
   (2) Additional requirements for the format and structuring of the information under para. 1, as well as the submission of metadata thereto and the inclusion of other metadata, are determined by the acts for the implementation of Regulation (EU) 2023/2859 and ESMA guidelines, for which the Commission has decided on their application according to Art. 13, para. 1, item 26 of the Financial Supervision Commission Act.

Section IV
Administrative Penal Provision
Art. 23. (Amended - SG, issue 41 of 2019; amended, issue 61 of 2020) (1) (Amended - SG, issue 41 of 2019) Insurers, reinsurers, their employees and the persons who manage and/or represent them, who commit or allow a violation of this ordinance, shall be punished according to Art. 644 of the Insurance Code.
(2) (Amended - SG, issue 41 of 2019) Supplementary social security companies, their employees and the persons who manage and/or represent them, who commit or allow a violation of this ordinance, shall be punished according to Art. 351 of the Social Security Code.
(3) (Amended - SG, issue 41 of 2019; amended, issue 61 of 2020) Management companies or their employees and the persons who manage and/or represent them, who commit or allow a violation of this ordinance, shall be punished according to Art. 273 of the Collective Investment Schemes and Other Collective Investment Undertakings Act.
(4) Public companies and the persons who manage and/or represent them, who commit or allow a violation of this ordinance, shall be punished according to Art. 221 of the Public Offering of Securities Act.
(5) Violations of the provisions of the ordinance shall be established by acts drawn up by officials authorized by the respective sectoral Deputy Chairman of the Commission.
(6) Penal decrees shall be issued by the sectoral Deputy Chairman of the Commission or by an official authorized by him.
(7) The establishment of violations, the issuance, appeal and execution of penal decrees shall be carried out in accordance with the Administrative Violations and Penalties Act.

Additional Provisions
§ 1. (Amended - SG, issue 61 of 2020) For the purposes of this ordinance:

1. (Amended - SG, issue 61 of 2020) "Management employees" are the members of the management board, the supervisory board, the board of directors and the control board, as well as other management positions in the administration, which are related to the performance of the activity of the persons under Art. 1, para. 1-3.
2. "Variable remuneration" is an element of total remuneration in the form of premiums, bonuses, retirement-related benefits, and other material incentives given based on performance evaluation criteria.
   § 2. (Supplemented - SG, issue 41 of 2019; amended, issue 61 of 2020; supplemented, issue 39 of 2026) The ordinance introduces:
3. Commission Recommendation 2009/384/EC of 30 April 2009 on remuneration policies in the financial services sector and Commission Recommendation 2009/385/EC of 30 April 2009 supplementing Recommendation 2004/913/EC;
4. Recommendation 2005/162/EC regarding the remuneration regime for directors of companies whose securities are admitted to trading on a regulated market;
5. requirements of Directive (EU) 2016/2341 of the European Parliament and of the Council of 14 December 2016 on the activities and supervision of institutions for occupational retirement provision (IORPs) (OJ, L 354/37 of 23 December 2016);
6. requirements of Directive (EU) 2017/828 of the European Parliament and of the Council of 17 May 2017 amending Directive 2007/36/EC as regards the encouragement of long-term shareholder engagement (OJ, L 132/1 of 20 May 2017).
7. (new - SG, issue 39 of 2026) requirements of Directive (EU) 2023/2864 of the European Parliament and of the Council of 13 December 2023 amending certain directives as regards the establishment and functioning of the European single access point (OJ, L 2023/2864 of 20 December 2023).

Transitional and Final Provisions
§ 3. The ordinance repeals Ordinance No. 43 of 2011 on the requirements for remuneration in insurers, reinsurers and health insurance companies (SG, issue 61 of 2011).
§ 4. The persons under Art. 1 shall bring their activities into compliance with this ordinance within six months of its entry into force.
§ 5. (Amended - SG, issue 66 of 2019; supplemented, issue 64 of 2021) The ordinance is issued on the basis of Art. 77, para. 5 and in connection with Art. 265, para. 1 of the Insurance Code, Art. 123o, para. 2 of the Social Security Code, Art. 33 and Art. 108, para. 10 of the Collective Investment Schemes and Other Collective Investment Undertakings Act, Art. 116v, para. 1 of the Public Offering of Securities Act and was adopted by Decision No. 140-H of 20 March 2013 of the Financial Supervision Commission. For the Chairman: Angel Dzhalazov

Provisions to the Ordinance for Amendment and Supplementation of Ordinance No. 46 of 2012 on the Procedure and Manner for Payment of Compensations from the Investor Compensation Fund (SG, issue 66 of 20.08.2019) § 9. In § 5 of the transitional and final provisions of Ordinance No. 48 of 2013 on the requirements for remuneration (promulgated, SG, issue 32 of 2013; amended and supplemented, issue 41 of 2019) the words "Art. 57, para. 4 of the Insurance Code, Art. 123o, para. 2 of the Social Security Code, Art. 33 and Art. 108, para. 2 of the Collective Investment Schemes and Other Collective Investment Undertakings Act" are replaced with "Art. 77, para. 5 of the Insurance Code, Art. 123o, para. 2 of the Social Security Code, Art. 33 and Art. 108, para. 10 of the Collective Investment Schemes and Other Collective Investment Undertakings Act".

Transitional and Final Provisions to the Ordinance for Amendment and Supplementation of Ordinance No. 48 of 2013 on the Requirements for Remuneration (SG, issue 61 of 10.07.2020) § 20. The persons under Art. 1 shall bring their remuneration policies into compliance with the requirements of this ordinance by September 30, 2020.
§ 21. Public companies under Art. 1, para. 3 and 4 shall prepare their remuneration policy implementation reports for their annual financial statements for 2020 in accordance with the requirements of this ordinance.

Transitional and Final Provisions to ORDINANCE No. 70 of 29.06.2021 on the Requirements for Funds for Making Payments (SG, issue 60 of 20.07.2021) § 7. In Ordinance No. 48 of 20.03.2013 on the requirements for remuneration (promulgated, SG, issue 32 of 2013; amended and supplemented, issue 41 of 2019; amended, issue 66 of 2019; amended and supplemented, issue 61 of 2020) the following amendments are made:

1. In Art. 2, para. 1, item 5, the words "supplementary social security funds" are replaced with "funds".
2. In Art. 6, para. 1, the words "supplementary social security funds" are replaced with "funds".

Transitional and Final Provisions to ORDINANCE No. 71 of 22.07.2021 on the Requirements for the Governance System of Insurers and Reinsurers (SG, issue 64 of 03.08.2021) § 8. In Ordinance No. 48 of 20.03.2013 on the requirements for remuneration (promulgated, SG, issue 32 of 2013; amended and supplemented, issues 41 and 66 of 2019 and issue 61 of 2020) the following amendments and supplements are made:

1. In Art. 2:
   a) a new para. 3 is created:
   "(3) Employees performing control functions in the insurer, respectively in the reinsurer, within the meaning of para. 1, item 4, are the persons who manage the functions under Art. 78, para. 1, items 1 - 3 of the Insurance Code, and the employees in the units that perform these functions. The remuneration policy of the insurer, respectively of the reinsurer, defines the positions of employees who may have a significant impact on the risk profile of the undertaking under para. 1, item 5, or contains a methodology for their determination."; b) the former para. 3 becomes para. 4.
2. In Art. 4:
   a) a new para. 3 is created:
   "(3) The remuneration policy of insurers and reinsurers must comply with the requirements of para. 1, items 1 - 4, whereby for the purposes of item 1, "acceptable level" is determined in accordance with risk management policies and the risk assumption limits provided therein, including in relations with service providers. The remuneration policy cannot jeopardize the ability of the insurer, respectively of the reinsurer, to maintain the necessary own funds."; b) the former para. 3 becomes para. 5; c) para. 4 is created:
   "(4) The insurer, respectively the reinsurer, ensures that the measures for avoiding conflicts of interest under para. 1, item 3 cover at least:
3. persons who develop the remuneration policy, who approve or review it, as well as who prepare, conclude or review agreements regarding remuneration;
4. persons who conclude or record insurance or reinsurance contracts that may significantly affect the risk profile of the insurer or reinsurer;
5. asset managers."
6. Art. 4a is created:
   "Art. 4a. (1) The insurer, respectively the reinsurer, which is a participating undertaking, an insurance holding company or a mixed-activity financial holding company, adopts a remuneration policy for the entire group, and the policy must reflect the complexity and structure of the group with the aim of uniform and consistent application for the entire group in accordance with the group's risk management strategies. The policy applies to all persons at group level and for each individual undertaking. (2) The insurer, respectively the reinsurer, which is a participating undertaking, an insurance holding company or a mixed-activity financial holding company, must ensure that:
7. there is a mutual interdependence of remuneration policies within the group and their compliance with legal and regulatory requirements for the undertakings that are part of it, and they are applied correctly;
8. all undertakings in the group comply with legal and regulatory requirements regarding remuneration;
9. conditions are created for managing significant risks at group level related to the application of the group's remuneration policy."
10. In Art. 6, para. 2, after the words "non-financial indicators" a comma is placed and "and in cases of an employee of an insurer, respectively of a reinsurer - also compliance with risk management rules and the regulatory framework and internal acts of the insurer, respectively of the reinsurer" is added.
11. In § 5 of the transitional and final provisions, after the words "Art. 77, para. 5" the words "and in connection with Art. 265, para. 1" are added.

Transitional and Final Provisions to the Ordinance for Amendment and Supplementation of Ordinance No. 63 of 8.11.2018 on the Requirements for the Content, Periodicity of Preparation and Deadlines for Submission of Reports for Supervisory Purposes of Pension Insurance Companies and the Funds Managed by Them (SG, issue 70 of 20.08.2024) § 19. In Ordinance No. 48 of 20.03.2013 on the requirements for remuneration (promulgated, SG, issue 32 of 2013; amended and supplemented, issues 41 and 66 of 2019, issue 61 of 2020, issues 60 and 64 of 2021) the following amendments are made:

1. In Art. 4, para. 2, the words "insured persons and pensioners" are replaced with "insured persons, PEPP insured persons, pensioners and PEPP beneficiaries".
2. Throughout the ordinance, the word "комисията" (the commission) is replaced with "Комисията" (the Commission).

Final Provisions to the Ordinance for Amendment and Supplementation of Ordinance No. 48 of 20 March 2013 on the Requirements for Remuneration (SG, issue 39 of 28.04.2026) § 9. As of January 10, 2030, the information under Art. 22b, para. 1 shall be provided for the first time through the European single access point.

Transitional and Final Provisions to the Ordinance for Amendment and Supplementation of Ordinance No. 17 of 7.07.2004 on the Documents Required for Issuing a Permit for Transformation of a Pension Insurance Company and a Supplementary Pension Insurance Fund and on the Requirements for Plans under Art. 327, para. 1, item 3 and Art. 336, para. 1 of the Social Security Code (SG, issue 73 of 14.08.2026, effective from 01.01.2027) § 21. In Ordinance No. 48 of 20.03.2013 on the requirements for remuneration (promulgated, SG, issue 32 of 2013; amended and supplemented, issues 41 and 66 of 2019, issue 61 of 2020, issues 60 and 64 of 2021, issue 70 of 2024 and issue 39 of 2026) the following amendments and supplements are made:

1. In Art. 2:
   a) in para. 1, item 5, the words "funds from them" are replaced with "funds or sub-funds therein"; b) in para. 2:
   aa) in item 1, the words "items 1 and 3" are replaced with "items 1, 3 and 5"; bb) in item 2, the words "companies and the funds managed by them" are replaced with "companies, the managed funds and sub-funds therein".
2. In Art. 4, para. 2, the words "the company and the funds managed by it" are replaced with "the company, the funds managed by it and the sub-funds therein".
3. In Art. 6, para. 1, the words "funds from them" are replaced with "funds or sub-funds therein".