Abstract

A Currency Board Arrangement (CBA) is a distinct set of rules designed for conducting monetary policy by central banks. Bulgaria has implemented it since 1997. The crucial part of the CBA legal regime is the subjective right of every owner of Bulgarian legal tender – leva to convert them into Euros, which is the reserve currency according to the Bulgarian National Bank Act. The central bank in Bulgaria, the Bulgarian National Bank (BNB), should sell Euro to every owner of Bulgarian money without any restrictions. This legal convertibility right is supported by the requirements for foreign exchange reserves managed by the BNB.