Bulgaria leads push to put San Marino’s EU Association Agreement on hold

As the European Parliament prepares to vote on long-negotiated Association Agreements with the micro-states of Andorra and San Marino, a conference in Brussels on Wednesday hosted by EUalive has amplified calls to delay or reconsider San Marino’s deal.

Titled “Micro-States and EU Association: Is Now the Right Time?”, the event brought together experts to scrutinize unresolved challenges, financial integration risks, regulatory divergences, and potential threats to the EU’s single market and institutional health.

The discussion featured a distinguished panel: Gérard Vespirerre, a researcher and author of a key report on micro-states in the EU; Dick Roche, former Irish Minister for European Affairs; Assen Christov, Chairman of the Supervisory Board of Starcom Holding; and Francesca Maria Bacciocchi, an attorney-at-law admitted to the Bar of the Republic of San Marino.

The conference’s core message emerged clearly: Bulgaria, leveraging its influence as a EU member and recent eurozone entrant, is actively pushing to put San Marino’s Association Agreement “on hold.” This stance reflects broader concerns about San Marino’s readiness to align fully with EU rules, particularly in financial services and banking transparency, an issue heightened by recent issues involving Bulgarian business interests in San Marino’s banking sector.

Exclusive: San Marino bank heist: how €15 million vanished after a done deal

The long road to association

Negotiations for Association Agreements with Andorra and San Marino began over a decade ago, culminating in signed texts in 2023. These pacts aim to integrate the two micro-states more deeply into the EU single market while preserving their sovereignty in areas like taxation and foreign policy. For San Marino (population 34,000) and Andorra (80,000), the agreements promise access to EU freedoms of movement for goods, services, capital, and persons, alongside participation in select EU programs—without full membership.

However, ratification remains pending. The process could be “exclusive” (European Parliament only) or “mixed” (requiring national parliaments’ approval), potentially delaying implementation into 2026 or beyond.

Recent developments have intensified debates. In January 2025, Christov (via Starcom Holding) submitted a binding offer to acquire a majority stake in Banco di San Marino through a special purpose vehicle, San Marino Group. The transaction involved depositing funds directly into the target bank’s account – endorsed by San Marino’s Central Bank – rather than using a standard escrow. While the deal was in progress, fifteen million euros from Christov’s company disappeared from his account at BSM. Since then, it remains unclear where the money has gone.

Key interventions: punchy warnings and deep concerns

Gérard Vespirerre, drawing from his comprehensive report on micro-states’ EU relations, set the analytical tone. He outlined structural asymmetries: micro-states’ small size allows nimble adaptation but also creates disproportionate influence risks in a union of 450 million people. Vespirerre highlighted “unresolved challenges” in financial supervision, tax cooperation, and competition rules.

“These agreements must not become backdoors for circumventing EU standards,” he stated, urging thorough due diligence before ratification. He emphasized that while Andorra’s alignment appears more advanced, San Marino’s framework still shows gaps in AML enforcement and banking transparency.

The situation of the micro-states are very peculiar, Vespierre argued. The key point are not their small territories, but their small population which stays together for centuries and make very small elite for the political parties, judiciary, finances, banks, economy, he said.

“When you realize that everybody is the cousin of somebody else, than you realize that the small communities are totally entangled, totally linked together. And that is a human problem the EU has never faced”, he said.

During the conference Vespirerre presented his detailed report titled “L’État de Droit européen doit s’imposer,” which examines the rule-of-law implications of the Association Agreements with Andorra and San Marino.

Dick Roche, former Irish European Affairs Minister with decades of EU negotiation experience, delivered one of the session’s most memorable lines. Framing the potential risks metaphorically, Roche warned: “Allowing certain practices or entities from these micro-states into the EU single market is like introducing cancer cells into the body – they may seem small and harmless at first, but they can metastasize and contaminate the entire organism.”

He argued that lax oversight in micro-states could enable money laundering, tax evasion, or illicit flows that undermine the eurozone’s integrity, and called for a precautionary pause: “Better to delay and strengthen safeguards than to regret hasty integration.”

Christov, representing Bulgarian financial interests and directly involved in the Banco di San Marino saga, brought a practitioner’s perspective. He defended legitimate cross-border investments but acknowledged the controversy surrounding the deal’s structure. Ге stressed Bulgaria’s stake in EU financial stability, noting his country’s recent euro adoption demands rigorous standards for all players.

“We support deeper ties with microstates, but only if they meet the same rules we now follow,” he said. Christov implied that San Marino’s handling of the acquisition raised questions about governance, aligning with Bulgaria’s reported push to halt ratification until clarifications are provided. His intervention underscored Sofia’s growing assertiveness in EU matters post-euro entry.

Several MEPs from Bulgaria across party lines and the country’s ambassador to the EU attended the conference.

“All member states must be convinced that relations with these microstates – in this case, San Marino – are based on a solid foundation. This includes predictability and legal certainty, and it is important that all issues that have been raised and remain unclear are properly resolved,” Rumen Alexandrov, Bulgarian Permanent Representative to the EU, told EUalive.

The scope of the Agreement is too broad, and for this reason it must be treated as a “mixed agreement”, the diplomat added. In other words, it covers matters falling both within the competence of the EU and within that of the member states. For this reason, the procedure for its adoption requires unanimity in the Council. The European Parliament must then approve it by a majority vote. Subsequently, all member states must ratify it in accordance with their national procedures.

Indeed, the ratification procedure may not progress as smoothly as expected. The Association Agreement with San Marino has not yet reached the permanent representatives of the member states, which means it cannot be submitted to the Council. According to the Bulgarian MEP Tsvetelina Penkova (S&D) as a result, it is almost certain that the vote scheduled for next week in plenary will not take place.

According to EUalive sources, Bulgaria is not alone among the EU member states in the push to put on hold the Association Agreements with Andorra and San Marino.

A lawyer’s personal battle

Francesca Maria Bacciocchi, an attorney admitted to the Bar of the Republic of San Marino, offered a deeply personal and insider perspective during the conference. While defending her country’s aspiration for closer ties with the EU, she revealed the frustrations she has encountered with San Marino’s judicial system—not only as a legal expert, but also as a party in her own family’s prolonged dispute with Banca di San Marino (BSM).

Despite her professional qualifications, Bacciocchi described the experience as hitting an impenetrable “wall” in resolving a case stemming from a 2010 family property trust transfer that the court declared fraudulent.

The case began when her father, Livio Bacciocchi, transferred valuable real estate into the “Bacciocchi Family Trust” to secure his children’s future. Leasing Sammarinese S.p.A. (later merged into BSM) challenged the transfer as a scheme to evade debts under three leasing contracts, arguing that it took place amid signs of financial distress and in violation of a 2009 pledge not to dispose of assets. Since then, Bacciocchi, representing her father, has faced endless difficulties because the San Marino courts have rejected her arguments on bureaucratic grounds, often invoking surprising provisions in the micro-state’s legislation. In her view, this impasse illustrates the “strange legislation” in San Marino that fuels skepticism about its alignment with European law.

Bacciocchi documented systemic problems: violations of the right to defense, procedural discrimination, inconsistent application of rules favoring banks, arbitrary rulings, judicial impermeability to substantive review, and the abusive use of criminal proceedings with deterrent and intimidating effects.

In a poignant admission underscoring her vulnerability, Bacciocchi confessed: “I am very afraid.”

Representatives of Andorra and San Marino, BSM, the country’s Central Bank and the Financial Intelligence Agency were invited at the conference which was also streamed online (watch recording from min 31). EUalive will welcome their positions in a follow-up article.

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After the publication of this article, EUalive received a press release from San Marino’s Congress of State (dated February 5, 2026) strongly defending the country’s judicial independence and separation of powers amid what it describes as unacceptable attempts to internationalize and politicize ongoing private financial and judicial disputes.

Key points:

The government reaffirms its commitment to an impartial, high-quality judiciary, praising the current leadership under Giovanni Canzio (Dirigente del Tribunale) as a solid guarantee of fairness and technical excellence.

It expresses concern over efforts to drag private litigation (especially financial/banking supervision cases) into diplomatic or international pressure campaigns, including media attacks or threats of political boycotts aimed at influencing courts or regulators.

San Marino insists that its path toward an EU Association Agreement enjoys unanimous support from European institutions and member states (explicitly including Bulgaria), with no official governmental opposition, and rejects any instrumentalization of disputes to block or delay integration.

The statement highlights San Marino’s strong compliance record (e.g., positive Moneyval evaluations on AML standards and top rankings in GRECO cycles), dismissing claims of normative shortcomings as biased and outdated.

It criticizes such pressure tactics as undemocratic, contrary to international norms, and indicative of parties lacking valid legal arguments in proper forums—while noting the irony that some critics include San Marino professionals previously linked to events damaging the country’s financial reputation.

The Congress expresses full confidence in continued backing from EU partners and Brussels, vowing to protect institutional autonomy from external interference and to proceed transparently without allowing coercion to derail the integration process or national sovereignty.

San Marino banking black hole raises red flags for EU Association Agreement

Caption: Bulgaria’s Permanent Representative to the EU Rumen Alexandrov makes remarks at the conference. In the podium, from left to right: Dick Roche, Gérard Vespierre, Assen Christov, Francesca Maria Bacciocchi [photo by Georgi Gotev]