EditSofia blocks San Marino’s EU association as the microstate belittles the “bank heist”
Bulgarian officials have used their position within the EU to press for a pause in discussions on San Marino’s Association Agreement until the matter is resolved
In a significant diplomatic move, Bulgaria has succeeded in having the item concerning San Marino’s (and Andorra’s) Association Agreement with the European Union removed from the agenda of the Coreper meeting on 6 May. The decision comes amid an ongoing high-stakes investment dispute involving Bulgarian national Assen Christov and his company Starcom Holding AD, in which approximately €15 million in funds remain immobilised in San Marino’s banking system.
Exclusive: San Marino bank heist: how €15 million vanished after a done deal
The setback for San Marino’s EU association has sparked backlash in the microstate. San Marino diplomats have reportedly been seeking to downplay the matter – and convince their EU counterparts – by characterising it as a purely private commercial dispute with no relevance to bilateral relations between the two countries or to San Marino’s EU aspirations.
This narrative is firmly rejected by the Bulgarian investor.
Assen Christov told EUalive: “Attempts from San Marino to present this case as a small private dispute will simply not fly. What we are dealing with is the prolonged immobilisation of substantial investment assets by state authorities, in circumstances where no adjudicated wrongdoing exists. This directly engages Bulgaria’s rights and interests under the bilateral investment treaty concluded between our two countries.”
The dispute traces back to a completed acquisition transaction in May 2025. Starcom, through its special-purpose vehicle San Marino Group S.p.A., had signed a binding Sale & Purchase Agreement to acquire a 51% stake in Banca di San Marino (BSM), the microstate’s flagship 102-year-old bank. As part of the €36.75 million deal, €15 million was transferred — €1.425 million as a confirmatory deposit and €13.575 million parked in a BSM account. The transaction collapsed following the opening of a criminal investigation for alleged “private corruption,” leading to the freezing of the funds and the rejection of the acquisition by the Central Bank of San Marino (BCSM).
Despite repeated attempts to repatriate the capital, the funds have remained blocked for over a year, causing ongoing and significant harm to the Bulgarian investors.
In April 2026, Christov and Starcom formally submitted a Notice of Dispute to the Republic of San Marino under Article 10 of the 2007 Agreement between the Republic of Bulgaria and the Republic of San Marino for the Promotion and Protection of Investments (the Bulgaria-San Marino BIT). The notice sets out serious allegations of breaches of core treaty protections, including fair and equitable treatment, full protection and security, protection against unlawful expropriation, and the free transfer of funds.
Dick Roche, former Irish European Affairs minister, who has for many years studied the risks from microstates’ often unusual legal practices, commented: “Investment treaties like the Bulgaria-San Marino BIT are inter-State instruments under international law. They create binding obligations between the two countries for the protection of each other’s investors. When measures attributable to the host state result in the neutralisation of a protected investment – as is alleged here – this is not merely a private commercial disagreement. It engages the international responsibility of the host state vis-à-vis the home state. Bulgaria, as the home state, has a clear and legitimate interest in ensuring that the treaty protections it negotiated are respected in practice.”
Roche added that the Treaty itself recognises the inter-State dimension of compliance disputes and provides mechanisms for their resolution, underscoring that such matters go beyond individual investor claims.
The latest diplomatic development at Coreper level reflects growing concern in Sofia over San Marino’s handling of the case and its broader implications for trust and the rule of law. Bulgarian officials have used their position within the EU to press for a pause in discussions on San Marino’s Association Agreement until the matter is resolved.
San Marino has long pursued closer integration with the EU single market through the Association Agreement. The postponement of Coreper discussions is widely seen as a direct consequence of the unresolved Starcom dispute.
Christov stressed that the investors remain open to an amicable resolution but will not accept attempts to sideline the issue. “This is about the reliability of San Marino as a jurisdiction for legitimate international business and the effectiveness of the treaty protections that Bulgaria has secured for its nationals. We expect our government to engage diplomatically to uphold those commitments,” he said.
The Bulgarian Ministry of Foreign Affairs has not issued a public comment on either the Coreper decision or the formal request for diplomatic support submitted by the investors’ legal team.
Bulgaria leads push to put San Marino’s EU Association Agreement on hold
Caption: The first page of a newspaper in San Marino attesting of the backlash in the microstate following the 6 May Corper meeting.
Updated: May 13, 2026 - 07:26
