Register for electronic shops and other changes in Decree N-18New obligations to online traders are introduced with the entry into force of the amendments to Decree № N-18 of 13 December 2006 regarding the registration and reporting by fiscal devices of sales in the retail outlets, the requirements for the software for their management and the requirements for the persons, who sell through an e-shop.

These new provisions aim at improving the ability to track the Internet commerce activity performed by both natural and legal persons.

The implemented new obligations concern online vendors that are using their own domain name, rental domain, or Internet sales platform domain.

The obligated persons should declare certain information to the National revenue agency prior to the start of their e-shop activity. They must provide data on the ownership of the e-shop, the used domain, the goods or services offered, and others. Also, traders should keep the information created through the e-shop software within the terms of Art. 38, para. 1 of the Tax-Insurance Procedure Code (TIPC) and provide it to the revenue administration upon request.

The new changes will enter into force on 29.12.2018. The e-shops will have a deadline to declare the required data until 29.03.2019.

The amendments to Decree№ N-18 implements a new registration regime regarding electronic shops.
Online sellers of goods or services via an e-shop must declare certain circumstances to the National Revenue Agency. As of 29.12.2018, traders have to submit specific information pursuant to Annex № 33 to the Decree via electronic service available through the e-services portal of the revenue administration before commencing their activity. Those who are already selling via an online store upon 29 December 2018 must submit information by 29 March 2019.
This obligation should be fulfilled within seven days of the change in the initial data upon registration and when the activity of sales of goods and services ceases.

The obligation to submit information to the NRA arises for three categories of subjects:
• Persons performing online sales through an e-shop using their own domain name;
• Online shoppers using a rented domain;
• Persons performing online sales through an online store using a domain of a platform for online sales.

According to the definition in the Value Added Tax (VAT) Act, an electronic shop is an "Internet site through which the sale of goods/services is made via conclusion of a distance contract under Art. 45 of the Consumer Protection Act and which has a built-in functionality to select, include and exclude goods/services in a consumer basket, enter buyer information, delivery address, and a payment method choice. "

The Decree lacks a legal definition of the term for "platform for making sales on the Internet". Rather, here should be considered the “marketplace” type of platforms in which sales and transactions take place through the functionalities of the sales platform itself.
In accordance with Annex №33 to Decree №N-18, the required information from the traders contains data such as the name of the e-shop, the e-shop domain, information about seller, etc. In cases where the vendor’s activity is being executed through an online sales platform, it is necessary to name the online platform, the online platform web address and the operator's online platform credentials.
The location of the database must also be specified on its own server, hosting server, or cloud service.
The type of goods or services should also be described in the Annex to the Decree when registering an online store.

Another obligation for traders is to store the information created through the e-shop software (current database and archive copies of the database) within 10 years and upon request from the revenue authorities to provide access to it with the possibility of exporting and copying data. This entails another obligation for traders in relation to the General Data Protection Regulation to make changes in their privacy statements to indicate to data subjects that there is a legally established storage period for a given category of data.

With the new provisions targeting the owners of electronic shops the revenue administration is trying to provide better accountability and transparency in the field of online trade. The aim of the Decree is to imply better means for prevention of tax evasion, as well as to increase security measures for online sales. This would lead to a decline in the gray sector's share of e-commerce and greater security for consumers.

Vassil Kostov

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Tags: E-commerce