The Socialist-led government, the President and the Socialist Party described the EU's decision as "unjust".
On Tuesday, the European Commission said it will not restore the accreditation of the two government agencies that were in charge of handling 220 million euro ($284 million) under its PHARE pre-accession programme. Earlier this year the EU froze some 500 million euro in pre-accession aid to Bulgaria, including payments under the SAPARD farm programme and the infrastructure facility ISPA, over suspicions of corruption.
On Wednesday, the opposition ODS, DSB and BND said in Parliament they will seek to overthrow the government with a no-confidence vote.
"This government's corruption and thieving have made the EU impose sanctions on our country," ODS floor leader Yordan Bakalov told Parliament, as quoted by state-run new agency BTA. Europe has refused to have confidence in Bulgaria, he added.
"The incumbents are fanning anti-European sentiment in an attempt to cover up their failure, " the leader of the opposition DSB, Ivan Kostov, told Parliament, as quoted by private Darik radio. "Bulgaria needs a new government," he added.
Consultations between the political parties on moving a no-confidence motion are expected to start on Thursday. This would be the seventh no-confidence vote in the present government . The ruling coalition, comprising the Bulgarian Socialist Party, (BSP) the centrist NDSV party led by former king Simeon Saxe-Coburg Gotha and the predominantly ethnic Turkish MRF, controls 150 seats in the 240-seat chamber. It easily survived the previous votes of no-confidence, which need 121 votes to pass.
The coalition government was formed in August 2005, three months after general elections were held in the country. In the elections BSP won most votes but not an outright majority.
Bulgaria will hold general elections next year.
The floor leader of the BSP, Angel Naidenov, said in Parliament his party is not trying to play down the importance of the situation, but considers the EU's decision "unjust" , state-run National Radio reported. Naidenov said the Socialist Party was ready to make staff and structural changes, Darik radio said.
Bulgaria's efforts were not properly acknowledged by the European Commission, President Georgi Purvanov told reporters as quoted by Darik radio.
Bulgaria is becoming a hostage to the battle between the main contenders for the EU elections, he added.
The decision of the European Commission is unexpected and disappointing, the government said in a statement on Tuesday. The Bulgarian authorities will keep up the pace of reforms and will adhere strictly to European rules and procedures to ensure proper and transparent spending of EU funds, the statement said.
Bulgaria, which joined the bloc in 2007, is due to have access to some 11 billion euro in EU funds by 2013.
It has been repeatedly criticised by the European Union for failure to tackle crime and high-level corruption. Despite the government's assurances that it has taken action, the country has failed to convict any senior official of corruption.