Company formation in Bulgaria

Corporate services in Bulgaria

• A Bulgarian corporate bank account,
• The minimum share capital ready for transfer
• At least one shareholder
• At least one managing director (who can also be the shareholder, a foreign citizen not residing in Bulgaria)
• A registered office in Bulgaria for tax resident status

To open a current account remotely, the entrepreneur must sign a power of attorney and provide notarized necessary documentation. The company must have a significant presence in Bulgaria. For personalized assistance, contact our team for tailored solutions based on individual needs.

For establishing a company in Bulgaria, follow these key steps:

1. Reserve a compliant company name, subject to state fees.
2. Prepare required documents, with assistance available for certified translation, notarization, and apostillization services.
3. Pay a registration fee to the Commercial Register.
4. Register as a VAT payer (mandatory for companies exceeding 50,000 BGN or approx. 25,600 EUR in a 12-month period).
5. Drafting Articles of Association
6. Open a corporate account for the company
   Compliance with tax regulations, social security contributions, and adherence to labour laws are essential for a smooth business setup.

Understanding Bulgaria’s tax system, which includes corporate income tax, value-added tax (VAT), and personal income tax, is crucial for businesses. Leveraging tax incentives, maintaining accurate financial records, and complying with accounting standards are vital aspects that necessitate the involvement of proficient accountants or tax advisors.

Starting a business in Bulgaria offers a myriad of advantages, making it an increasingly attractive destination for entrepreneurs seeking a favourable business environment. One of the key factors contributing to Bulgaria’s appeal is its strategic geographical location. Situated at the crossroads of Europe and the Middle East, Bulgaria provides businesses with easy access to a vast market. The country’s membership in the European Union enhances its economic stability, offering entrepreneurs the benefit of participating in the EU’s single market and enjoying the free movement of goods and services.

What types of companies exist in Bulgaria?

Bulgaria, like many other countries, offers a variety of legal forms for doing business, each of which has its own characteristics, advantages and limitations. Choosing the best form of company depends on many factors, including the size of the business, the planned amount of investment, the goals of the owners, and the degree of personal responsibility desired. In this article, we will look at the main types of companies available in Bulgaria and their key characteristics.

1. Individual entrepreneur (ET – “Ednolichen trgovets”)

An individual entrepreneur is the simplest and most accessible form of doing business. This form is suitable for a single owner and does not require the formation of the authorized capital. The main disadvantage is unlimited personal responsibility for the debts and obligations of the business.

2. Partnership (SD – “Sbiratelno druzhestvo”)

A partnership implies the existence of two or more founders who conduct business under a common name and bear unlimited joint responsibility for the company’s obligations. This form is suitable for small family businesses or partnerships where a high level of trust between partners is important.

3. Limited partnership (KD – “Komanditno druzhestvo”)

In a limited partnership, there is at least one limited partner (investor), whose liability is limited to the size of its investments, and one limited partner (managing partner), who bears unlimited liability. This type of company is suitable for projects where you need to attract external funding, but at the same time you want to maintain control over management.

4. Limited Liability Company (OOD – “Oodruzhestvo s limitaena razgovornost”)

OOD is the most popular form of legal entity in Bulgaria. It offers a limited liability of the founders (no more than the size of their invested contributions) and can be created by one or more persons. The authorized capital is divided into shares, which makes the OOD a suitable choice for small and medium-sized businesses.

5. Joint-Stock Company (hereinafter referred to as “Joint – Stock Druzhestvo”)

A joint-stock company is suitable for large enterprises with a large number of investors. It requires a minimum authorized capital and can issue shares that can be publicly traded on an exchange. AD provides limited liability for shareholders, which makes it attractive for large investment projects.

6. Cooperative (Cooperative)

Cooperatives are most often created to work together in the agricultural sector, production, or service delivery. They can be organized by a group of individuals or legal entities that have pooled resources to achieve a common economic goal. Cooperatives are regulated by special legislation.

Conclusion

The choice of legal entity form in Bulgaria depends on many factors, including the size and objectives of the business, the desired level of responsibility and the need for investment. Each form has its own unique characteristics and requirements, so it is important to carefully evaluate all options and, if necessary, consult with legal experts to choose the most suitable form for your business in Bulgaria.

Table oftax rates for Bulgarian companies for 2024:

 What is the size of the company’s authorized capital in Bulgaria?

The size of the authorized capital is one of the key aspects when registering a company in Bulgaria, as it can influence the choice of the form of a legal entity, as well as the obligations and business opportunities. The authorized capital is the sum of funds or assets contributed by the founders or shareholders to the company when it was established. This amount serves as a guarantee of creditors ‘ interests and determines the minimum financial threshold that the company must maintain. In Bulgaria, the size of the authorized capital varies depending on the form of the company’s legal entity.

Limited Liability Company

• Minimum authorized capital: 2 leva (approximately 1 euro).
• OOD is the most popular form of business in Bulgaria due to its flexibility and limited liability of founders, which does not exceed the size of their investments in the authorized capital.

Joint-Stock Company (AD)

• Minimum authorized capital: BGN 50,000 for closed joint-stock companies (CJSC) and BGN 100,000 for open joint-stock companies (JSC) (approximately EUR 25,000 and EUR 50,000, respectively).
• AD is suitable for large businesses with the ability to attract investment through the issue of shares.

Limited Partnership (CD) and Partnership (SD)

• For these types of businesses, the legislation of Bulgaria does not set requirements for the minimum size of the authorized capital.
• The founders are personally liable for the company’s obligations, which are unlimited for the partners in the partnership, and limited to the size of their contribution for the limited partners in the limited partnership.

Co-op

• Minimum authorized capital: Determined by the founders and can be changed in accordance with the cooperative’s charter.
• Cooperatives are usually created for joint activities in the agricultural sector, production or service provision, where the founders make equal contributions.

Importance of share capital

The authorized capital is important not only as the financial base of the company at the time of its creation, but also as an indicator for creditors and partners, reflecting the financial stability and seriousness of the founders ‘ intentions. In addition to meeting the minimum authorized capital requirements, the company needs to take into account the needs of future operations and possible risks in order to ensure a sufficient level of capitalization.

Conclusion

The size of the authorized capital in Bulgaria depends on the form of the company’s legal entity and can vary from a symbolic amount to significant investments for joint-stock companies. Choosing the optimal size of the authorized capital requires careful analysis of the business objectives, its financing needs and planned activities. In any case, the authorized capital is the foundation for starting and developing a business, as well as an important factor for ensuring its financial stability and trust on the part of partners and investors.

 Should a company in Bulgaria have a local director?

Bulgarian legislation does not strictly require that the director or manager of a company must be a resident of Bulgaria. This means that foreign citizens can hold the position of director of a Bulgarian company without having to live in Bulgaria. However, there are several aspects that need to be considered:

1. Registration and taxation: The presence of a foreign director does not affect the company’s obligations to the Bulgarian tax authorities. The company must meet all local tax requirements, including corporate tax, VAT and other fees.
2. Company representation: Although the position of director does not require local residency, in practice it may be necessary to have a person capable of representing the company’s interests in Bulgaria to perform administrative procedures, communicate with government authorities and participate in legally significant events.
3. Banking operations: To open and manage the company’s bank accounts in Bulgarian banks, you may need additional documents from a foreign director, such as proof of residency or a special power of attorney.

Practical considerations

Although there are no legal restrictions on the appointment of foreigners as directors, in practice there may be difficulties associated with managing a company from a distance. In some cases, it may be appropriate to appoint a local director or representative who can quickly address current issues, communicate with local authorities, and ensure that all necessary formalities are completed.

Conclusion

In Bulgaria, there is no legal requirement that the director of a company must be a resident of the country. Foreign citizens are free to hold this position, subject to compliance with all applicable tax and administrative obligations of the company. However, it is important to take into account the practical aspects of business management and the possible benefits of having a local representative for effective interaction with government agencies and banks. In some cases, the involvement of a local director or manager may be recommended to facilitate business operations and minimize administrative difficulties.

 What is the amount of state fees when establishing a company in Bulgaria?

The establishment of a company in Bulgaria involves the payment of certain state fees, which are part of the administrative costs of the registration process. The amount of these fees may depend on various factors, including the chosen form of legal entity, the method of registration (electronic or paper-based), and additional services. Below is an overview of the main state fees associated with the establishment of a company in Bulgaria, up-to-date at the time of writing.

1. Limited Liability Company

• Registration fee: When registering a public association through the commercial register, the state fee is about BGN 110 (approximately EUR 56) for paper submission of documents and about BGN 55 (approximately EUR 28) for electronic registration.
• Additional Fees: Additional fees may apply for publishing registration information in the Official Gazette.

2. Joint-Stock Company (AD)

• Registration fee: For AD, the state registration fee will be higher and will amount to about BGN 210 (approximately EUR 107) for paper documents and about BGN 105 (approximately EUR 54) for electronic registration.
• Additional Fees: Similar to the OOD, additional fees may apply for publication in the Official Gazette.

3. Trademark registration

• If a company wishes to register a trademark in Bulgaria, this will be subject to a separate fee. The amount of the fee depends on the category of goods and services covered by the brand and can start from about BGN 100 (about EUR 51) per class of goods/services.

4. Other fees and charges

• Notarial expenses: The company’s constituent documents must be notarized. Notary fees depend on the nature of the document and the size of the company’s authorized capital.
• Fees for legal and consulting services: In addition to government fees, companies may also incur the cost of providing lawyers or consultants for registration and document preparation.

Conclusion

The amount of state fees for the establishment of a company in Bulgaria is relatively small, especially when using the electronic registration form. However, potential entrepreneurs should also consider other possible costs associated with the registration process, including notary fees and legal consultants. It is always recommended to get up-to-date information about the amount of fees and documentation requirements immediately before starting the registration process, in order to ensure an effective and successful establishment of your company in Bulgaria.

 What is the annual cost of servicing a company in Bulgaria?

The annual cost of servicing a company in Bulgaria is an important aspect of financial planning for any business planning to operate in this country. These expenses include not only government duties and taxes, but also other mandatory payments, as well as accounting, legal and administrative costs. In this article, we will provide an overview of the main components of the company’s annual maintenance costs in Bulgaria to give entrepreneurs an idea of what financial obligations they may face.

Taxes and state duties

1. Corporate tax: Bulgaria has one of the lowest corporate tax rates in the European Union — 10%. This tax is levied on the company’s profits.
2. Dividend tax: The tax rate on dividends is 5%. It applies to dividends paid by a Bulgarian company to its shareholders.
3. Annual state fee: Companies are required to submit annual financial statements to the Commercial Register, accompanied by payment of a state fee, the amount of which depends on the size of the company and the type of documents submitted, but usually it does not exceed several hundred BGN.

Accounting and auditing services

1. Accounting: The cost of accounting services depends on the volume of operations, the size of the company and the specifics of the business. On average, small companies can expect monthly expenses from BGN 200 to 500 (from 100 to 250 euros).
2. Audit: If a company is required to be audited in accordance with Bulgarian legislation, the cost of audit services may vary significantly depending on the size of the company and the complexity of its financial operations. The price can start from several thousand leva.

Legal services

Legal expenses may vary significantly depending on the company’s needs. Regular legal services may include consultations on labor law, contractual relations, and corporate governance. The cost of legal services starts from several hundred leva per month.

Administrative expenses

1. Office rental: The rental price varies depending on the location and quality of the office space. Prices are higher in Sofia and other major cities.
2. Utilities and Internet: Also vary depending on the size of the office and the intensity of use, but they are mandatory expenses for the operation of the office.
3. Employee expenses: Including salaries, social security, and health insurance. Social contributions in Bulgaria make up a significant part of staff costs.

Conclusion

The annual cost of servicing a company in Bulgaria varies depending on many factors, including the size and type of activity of the company, as well as the level of services required. When planning a business in Bulgaria, it is important to take into account all possible costs in order to ensure its sustainable and efficient operation. Contacting professional consultants will help you get a more accurate estimate and plan your budget.

 What are the main advantages of establishing a company in Bulgaria?

The establishment of a company in Bulgaria is an attractive opportunity for entrepreneurs and investors for many reasons. The country, which has been a member of the European Union since 2007, offers a stable economic environment, favorable tax legislation and access to European markets. Let’s take a closer look at the main advantages of establishing a company in Bulgaria.

1. Favorable Tax Legislation

One of the most significant advantages of Bulgaria is its low corporate tax rate, which is only 10%. This is one of the lowest income tax rates in the European Union. In addition, Bulgaria offers a preferential tax rate on dividends — 5%, which makes the country even more attractive for foreign investors.

2. Strategic Geographical Location

Located at the crossroads between Europe and Asia, Bulgaria provides easy access to the markets of both continents. This is especially important for export and import companies, as the country has access to the Black Sea and a well-developed infrastructure of transport corridors.

3. Ease Of Doing Business

In Bulgaria, there is a relatively simple and fast procedure for registering a company. The Government seeks to simplify administrative processes and support entrepreneurial initiative. Thanks to this, the country is attracting more and more foreign investment.

4. The European Union and the Single Market

As a member of the European Union, Bulgaria provides companies with access to the EU single market, which has more than 500 million consumers. This opens up huge opportunities for trade and investment without tariff or non-tariff barriers.

5. Skilled and Cost-Effective Work

Bulgaria is famous for its highly skilled yet affordable workforce, especially in the fields of information technology, engineering and finance. This makes the country an ideal place for developing ITstartups and research centers.

6. Developed Infrastructure

Bulgaria has a well-developed infrastructure, including modern highways, ports and airports, which ensures efficient logistics and transportation of goods.

7. Opportunities for Obtaining Funding

Bulgarian companies have access to various sources of funding, including European grants and funds designed to support innovation, business development and infrastructure projects.

8. Stability and Security

Bulgaria offers political and economic stability, which is a key factor for successful business operations. In addition, the country has a low crime rate and a high level of security for life and work.

Conclusion

The establishment of a company in Bulgaria offers investors many advantages, including favorable tax legislation, strategic geographical location, access to the European market, skilled and cost-effective labor, as well as a stable economic and political environment. These factors make Bulgaria one of the most attractive countries for doing business in Europe.

 What are the ways to establish a company in Bulgaria?

The establishment of a company in Bulgaria is a process that attracts many foreign investors due to its favorable tax treatment, strategic location and access to European Union markets. There are various legal forms for establishing a company in Bulgaria, each of which has its own characteristics, requirements and advantages. In this article, we will look in detail at the main ways to establish a company in Bulgaria.

1. Limited Liability Company

A limited liability company is the most popular form of business among small and medium-sized enterprises in Bulgaria. This form implies that the liability of the founders is limited to the size of their contribution to the authorized capital of the company. The minimum authorized capital for a public organization is BGN 2 (about 1 euro), which makes this method especially attractive for small businesses.

2. Joint-Stock Company (AD)

A joint-stock company (AD) is suitable for large enterprises with a large number of shareholders. In this form of company establishment, shareholders have a limited liability equal to their share of the company’s share capital. The minimum authorized capital for a joint-stock company is BGN 50,000 (approximately EUR 25,000). AD allows you to issue stocks and bonds, which can be useful for attracting investment.

3. Limited Company (CD)

A limited company in Bulgaria is a partnership in which one or more of the founders (complementars) have unlimited liability, while the other founders (limited partners) have limited liability. This type of company is often used for family businesses or small businesses where separation of management responsibilities and responsibilities is important.

4. Representative office or branch of a foreign company

Foreign companies can expand their activities to the Bulgarian market by opening a representative office or branch. The representative office is not an independent legal entity and cannot conduct commercial activities. Its main function is marketing and promotion. A branch office, on the other hand, is an extension of a foreign company and can conduct business in Bulgaria, with the financial responsibility of the parent company.

5. Individual entrepreneur (s)

Sole proprietorship or sole proprietorship is a form of doing business that is suitable for a single person who wants to work for themselves. This is the simplest and least expensive form of doing business in Bulgaria, but the entrepreneur bears unlimited responsibility for his personal property.

Company registration process in Bulgaria

The process of registering a company in Bulgaria includes submitting documents to the Commercial Register, paying the state fee and publishing the constituent documents. Depending on the type of business, additional licenses or permits may be required. In general, the registration process takes from several days to several weeks.

Conclusion

The choice of legal form for establishing a company in Bulgaria depends on many factors, including the size and type of business, the number of founders, and financial and legal considerations. Thanks to its flexible legislation and favorable tax regime, Bulgaria is an attractive jurisdiction for doing business in the European market.

 Do I need to have a legal address in Bulgaria?

The legal address in Bulgaria plays an important role not only in the process of registering a company, but also in its further operational activities. Understanding the legal address requirements will help entrepreneurs ensure compliance with Bulgarian legislation and avoid possible legal difficulties. In this article, we will take a closer look at why you need a legal address in Bulgaria and what are the features of using it.

Why do I need a legal address?

1. Company registration

Legal address is required at the stage of registration of any company in Bulgaria. It is used as the official address of the company, where it is registered in the Trade Register and where official correspondence with government agencies and other institutions is carried out. Without specifying the legal address, the company registration process cannot be completed.

2. Legal correspondence and notifications

The legal address is used for receiving all types of legal and official correspondence, including notifications from tax authorities, court notices, and other important documents. This ensures that all necessary notifications and requests from government agencies and business partners are received correctly and in a timely manner.

3. Tax registration and reporting

For tax purposes, the company must have a registered legal address in Bulgaria. This address is used by the Internal Revenue Service to determine the tax jurisdiction and send tax notifications. It is also required for filing tax reports and fulfilling other tax obligations.

4. Trust of customers and partners

Having a legal address in Bulgaria can help increase the trust of customers, suppliers and business partners, as it confirms the company’s official presence in the jurisdiction and its willingness to comply with local laws.

How do I get a legal address in Bulgaria?

Companies can use both the actual location of their office in Bulgaria and the services of providing a legal address through specialized services. The latter option is especially relevant for foreign entrepreneurs who do not yet have a physical presence in the country, but want to register a company in Bulgaria. In such cases, companies that provide virtual office services can offer a legal address for registration and subsequent use in business correspondence.

Conclusion

The presence of a legal address in Bulgaria is a mandatory requirement for the establishment and further operation of the company in the country. It plays a key role in company registration, tax accounting, receiving legal correspondence, and maintaining the trust of the business community. Choosing a suitable legal address and using it correctly ensures compliance with legal requirements and contributes to the successful conduct of business in Bulgaria.

 Can I open a branch of a foreign company in Bulgaria?

Opening a branch of a foreign company in Bulgaria is a strategic step to expand the business and access the European Union market. Bulgaria, with its favorable tax regime, strategic geographical location and stable economy, is an attractive jurisdiction for international companies seeking to strengthen their presence in Europe. In this article, we will look in detail at the process of opening a branch of a foreign company in Bulgaria, the key requirements and advantages of such a step.

The process of opening a branch in Bulgaria

The opening of a branch of a foreign company in Bulgaria begins with the submission of a number of documents to the Bulgarian Trade Register. The process includes the following steps:

1. Preparation and legalization of documents: A foreign company must prepare its constituent documents and an extract from the trade register of the country of origin confirming the existence of the company. These documents must be notarized and legalized (or apostilled if the country is a signatory to the Hague Convention).
2. Translation of documents: All documents must be translated into Bulgarian by a certified translator and certified in accordance with the requirements of Bulgarian legislation.
3. Registration in the Commercial Register: Then you need to submit a set of documents for registration of the branch in the Bulgarian Trade Register. It is important to note that the branch will have the status of a legal entity under Bulgarian law.
4. Appointment of a branch manager: A foreign company must appoint a branch manager to represent the company’s interests in Bulgaria. The manager must have the right to enter into transactions on behalf of the branch.
5. Tax registration and bank account opening: After registration, the branch must be registered with the Bulgarian Tax Service and receive a tax number. You also need to open a bank account with a Bulgarian bank for financial operations of the branch.

Advantages of opening a branch in Bulgaria

1. Access to the European market: Opening a branch office in Bulgaria allows foreign companies to easily access the European Union market and use Bulgaria as a strategic base for expanding their operations in Europe.
2. Tax benefits: Bulgaria offers one of the lowest tax rates in the EU on corporate income, which makes it attractive for foreign investment.
3. Skilled and cost-effective labor: Companies can take advantage of a skilled and relatively inexpensive workforce to manage their operations.
4. Stable economy and political system: Bulgaria offers a stable economic and political environment, which reduces risks for foreign investors.

Conclusion

Opening a branch of a foreign company in Bulgaria is an excellent strategy for expanding your business and entering the European market. Thanks to its favorable tax climate, skilled labor and access to the EU market, Bulgaria offers many advantages for international companies. It is important to carefully prepare for the registration process, following all the requirements of Bulgarian legislation, in order to ensure a successful and efficient establishment of the branch.

 Can a foreigner open companies in Bulgaria?

Foreign entrepreneurs who are interested in expanding their business in Europe often look to Bulgaria as an attractive jurisdiction for starting a company. Due to its strategic location, favorable tax treatment, relatively low operating costs and access to the European Union’s single Market, Bulgaria offers significant advantages for foreign investors. In this article, we will look at the key aspects related to the possibility of opening a company in Bulgaria by foreign citizens, including the types of companies, registration procedures and basic requirements.

Possibility of opening a company by foreigners in Bulgaria

Foreign citizens have the right to establish or acquire a company in Bulgaria under the same conditions as local residents. This right is supported by Bulgarian legislation and the country’s policy aimed at attracting foreign investment. Foreign entrepreneurs can choose between different legal forms of companies, depending on their business objectives, scope of operations, and management structure.

Legal forms of companies for foreigners

The main legal forms available to foreign investors in Bulgaria are:

• Limited Liability Company: It is suitable for small and medium-sized businesses, requires a minimum authorized capital of BGN 2 (about 1 euro), and the responsibility of the founders is limited to their contribution to the company’s capital.
• Joint-Stock Company (AD): Better suited for a large business, the minimum authorized capital is BGN 50,000 (about EUR 25,500), and shares can be offered publicly.
• Limited company and general partnership: Less frequently used forms that are suitable for certain types of business partnerships.

Company registration process

Registration of a company by foreigners in Bulgaria includes the following steps:

1. Selecting a company name and verifying its uniqueness.
2. Preparation and signing of constituent documents, including the charter and the foundation agreement, which must be notarized.
3. Payment of the authorized capital.
4. Registration of the company in the Commercial Register and obtaining a taxpayer identification number.
5. Opening a bank account.
6. Obtaining the necessary licenses and permits, if this is required for a specific type of activity.

Basic requirements and recommendations

• Having a legal address in Bulgaria: To register a company, you must have a registered office in the country.
• Compliance with tax and accounting requirements: Companies are required to maintain records and provide financial statements in accordance with Bulgarian legislation.
• Obtaining special licenses: Some activities may require special licenses or permits.

Advantages of opening a company in Bulgaria for foreigners

• Favorable tax treatment: One of the lowest income tax rates in the EU (10%).
• Access to the European market: Facilitating trade and investment within the EU.
• A skilled and cost-effective workforce.
• Stable economic and political environment.

In conclusion, Bulgaria offers foreign investors convenient and favorable conditions for starting and running a business. Compliance with the country’s procedural requirements and legislation will allow us to successfully implement the business project and ensure its long-term development in the European market.

 Can I get a residence permit when setting up a company in Bulgaria?

The establishment of a company in Bulgaria is one of the ways that foreign citizens can be considered as an opportunity to obtain a residence permit in this country. Thanks to its membership in the European Union, Bulgaria offers attractive business conditions, including low tax rates and access to the European single Market. In this article, we will look at how the process of establishing a company in Bulgaria can be related to obtaining a residence permit, highlighting the key requirements, procedures and possible benefits.

Residence permit through the company’s establishment

Foreign citizens can use the company’s establishment in Bulgaria as one of the ways to apply for a residence permit. However, it is important to understand that the establishment of a company by itself does not guarantee the automatic granting of a residence permit. Applicants must meet a number of conditions and requirements established by Bulgarian law.

Basic requirements and conditions

1. Investment in the Bulgarian economy: One of the key factors is the amount of investment made through the established company in the country’s economy. A foreign investor must prove that their activities contribute to the economic development of Bulgaria.
2. Job creation: A company is often required to create jobs for Bulgarian citizens or residents of the European Union, which is also an indicator of a positive contribution to the country’s economy.
3. Financial stability: The applicant must demonstrate financial stability and the ability to provide for themselves and their family members without using social assistance in Bulgaria.
4. Legal and actual address: Presence of the company’s legal address and the applicant’s actual place of residence in Bulgaria.

The process of applying for a residence permit

1. Company registration: The first step is to successfully establish and register a company in Bulgaria in accordance with local legislation.
2. Submission of documents: The applicant submits a package of documents to the Bulgarian Migration Service, including documents confirming investment, job creation and financial sustainability.
3. Waiting for a decision: After submitting all the necessary documents, the applicant must wait for the decision of the competent authorities. The application processing time may vary.
4. Obtaining a residence permit: In case of a positive decision, the applicant is granted a residence permit, which is usually issued for one year with the possibility of subsequent renewal.

Advantages of a residence permit in Bulgaria

• Access to the EU market: A residence permit allows you to travel freely and conduct business within the European Union.
• Quality of life: Bulgaria offers a high quality of life, a temperate climate and affordable living expenses.
• Tax benefits: Favorable tax treatment for foreign investors and entrepreneurs.

In conclusion, obtaining a residence permit in Bulgaria through a company establishment is a real opportunity for foreign investors. It is important to carefully study all the requirements and ensure that the company meets the established criteria for successfully obtaining resident status.

 What is written in the charter of a company registered in Bulgaria?

The Articles of Association of a company registered in Bulgaria play a key role in determining the structure, objectives and rules of the company’s management. This document sets out the fundamental aspects of the organization and its operations, providing a legal framework for all of the company’s operations. The Charter must be drawn up in accordance with Bulgarian law and contain a number of mandatory sections to ensure its legal force. In this article, we will look at the key elements that should be spelled out in the charter of a company registered in Bulgaria.

1. Basic information about the company

• Full and abbreviated name of the company: The Articles of Association must clearly indicate the full official name of the company in Bulgarian, as well as any abbreviations or trade names that the company plans to use.
• Legal address: The company’s legal address in Bulgaria must be indicated, which will be used for official correspondence and state registration.

2. Goals and subject of the company’s activities

The charter should describe the main goals and activities of the company, defining the areas of business in which it intends to work. This includes both the main areas of activity and any additional areas that the company may be engaged in.

3. Authorized capital

This section specifies the amount of the company’s authorized capital, as well as the procedure for its formation and modification. The share or par value of shares owned by each of the founders or shareholders, as well as the terms of capital contribution, must be specified.

4. Company management

The Charter should contain provisions on the company’s management structure, including:

• Governing bodies: A description of the company’s governing bodies, such as the meeting of shareholders (founders) and the board of Directors or managing Director, and their powers.
• Decision-making: Meeting procedures, quorum required for decision-making, and voting methods.

5. Rights and obligations of shareholders

The Articles of Association should define the rights and obligations of shareholders, including the rights to dividends, participation in the management of the company and the rights to liquidate the company.

6. Financial activities and reporting

This section describes the rules of accounting, preparation and presentation of financial statements, auditing, and distribution of the company’s profit and loss.

7. Amendments to the Charter and liquidation of the company

The articles of association should contain procedures for making changes to the statutory documents, as well as procedures for the liquidation of the company, including the distribution of assets after all obligations are met.

Conclusion

The Charter is a fundamental document for any company registered in Bulgaria, defining its legal status, structure, rights and obligations of participants. When drafting it, it is important to ensure compliance with all the requirements of Bulgarian legislation in order to avoid possible legal difficulties in the future. Carefully designed articles of association can serve as a solid foundation for successful and sustainable development of the company.

 How long does it take to establish a company in Bulgaria?

The establishment of a company in Bulgaria is a process that attracts foreign investors due to the relative simplicity and transparency of the procedures. The time required to complete all the formalities for establishing a company may vary depending on various factors, including the type of company, the availability of documents and the effectiveness of interaction with Bulgarian government agencies. In this article, we will look at the main stages of the process of establishing a company in Bulgaria and estimate the time required to complete them.

Stages of establishing a company in Bulgaria

1. Preparation of documentation

The first step is to prepare all the necessary documents, including the foundation agreement and the company’s charter. For foreign investors, this may also include translating documents into Bulgarian and notarizing them. The time required for this stage may vary, but it usually takes from a few days to 2 weeks.

2. Registration in the Commercial Register

After all documents are prepared and certified, the next step is to submit them for registration in the Commercial Register. The registration process usually takes 1 to 3 business days from the moment of submitting an application. It is worth noting that the terms may vary depending on the workload of the registration authority.

3. Opening a bank account

To establish a company in Bulgaria, you must open a bank account and deposit the authorized capital to it. The process of opening an account can take from several hours to several days, depending on the bank and the availability of all the necessary documents.

4. Obtaining the necessary licenses and permissions

Depending on the company’s field of activity, special licenses or permits may be required. The time required to obtain these documents varies greatly depending on the specific requirements and can take anywhere from a few weeks to several months.

Overall time estimate

On average, the process of establishing a company in Bulgaria, from the beginning of preparing documents to the completion of registration, can take from 1 to 4 weeks, provided that all documents are prepared correctly and no special licenses or permits are required. However, for companies whose activities are subject to licensing or require special permits, the time limit may increase.

Important considerations

• Efficient preparation: Delays often occur due to incomplete or incorrect document packages. We recommend that you use the services of legal consultants to ensure that the documentation is correct and complete.
• Interaction with banks: When choosing a bank to open an account, you should take into account its experience in working with foreign clients and the speed of processing applications.
• Business-based planning: Some types of businesses require more time to obtain all the necessary permits, which should be taken into account when planning.

Conclusion

Establishing a company in Bulgaria is a relatively quick and easy process, especially when compared to other European Union countries. Proper preparation and understanding of all the requirements can significantly speed up the process and help avoid unnecessary delays, allowing foreign investors to start their business in Bulgaria as soon as possible.

 What activities can companies do in Bulgaria?

Companies registered in Bulgaria can engage in a wide range of activities, reflecting the diversity of the country’s economic landscape and its integration into the European Union. Thanks to its favorable tax system, strategic location and qualified workforce, Bulgaria offers attractive conditions for the development of both traditional and innovative business sectors. In this article, we will look at the key activities that companies can engage in in Bulgaria, exploring their potential and market features.

1. Tourism

Tourism is one of the leading sectors of the Bulgarian economy, thanks to its rich cultural heritage, picturesque mountain landscapes and long sandy beaches of the Black Sea. Companies can organize tourist tours, provide accommodation services, restaurant services, and entertainment. The development of green and rural tourism also opens up new prospects for investment.

2. Information technology and software development

In recent years, Bulgaria has established itself as an important center of the IT industry and software development in Europe. Due to the presence of talented specialists and relatively low costs of doing business, the country attracts international companies and startups in the field of high technologies.

3. Agriculture and food industry

Bulgaria’s agricultural sector has significant potential due to its fertile land and favorable climate. The production and export of cereals, oilseeds, fruits and vegetables, as well as the development of winemaking and the production of organic products are of interest to investors.

4. Energy sector

Bulgaria offers opportunities for investment in the energy sector, including renewable energy production, nuclear power development and energy efficiency projects. The country aims to increase the share of renewable energy sources in its energy mix, which opens up prospects for green investment.

5. Mechanical engineering and manufacturing

Bulgaria’s traditionally developed mechanical engineering and manufacturing industries continue to attract foreign investment. The production of automotive components, electronics, textiles and other industrial goods offers a wide range of business development opportunities.

6. Transport and logistics

Due to its geographical location, Bulgaria serves as an important transit corridor between Europe and Asia. The development of transport infrastructure and logistics services, including sea and air transportation, rail and road transport, is a promising area for investment.

Conclusion

Companies in Bulgaria have ample opportunities to do business in various sectors of the economy. From tourism and IT to agriculture, energy and manufacturing, the country offers favorable conditions for local and foreign entrepreneurs. It is important to carefully study market trends and the legal environment in order to choose the best business development strategy. At the same time, Bulgaria’s attractive tax policy and desire to strengthen its position in the European economic area make it an attractive country for investment and business development.

 Should a company in Bulgaria have employees?

The question of the need to have employees for a company registered in Bulgaria concerns both legal requirements and strategic business planning. Bulgarian legislation sets out the framework for doing business, but the specific requirements for the number of employees may vary depending on the type of activity and the legal form of the company. Let’s take a closer look at this issue, taking into account various aspects of managing a company in Bulgaria.

Legal aspects

Bulgarian legislation does not establish a general mandatory requirement for full-time employees for all types of companies. This means that from a legal point of view, a company can be registered and operate without hiring staff, as long as this does not contradict other specific requirements related to its activities.

However, certain activities that require licensing or certification may have specific qualification and staffing requirements. For example, in the areas of education, medicine, construction, and transportation, staff requirements may be strictly regulated by relevant regulations.

Strategic planning and management

From a strategic planning perspective, the presence or absence of employees in a company affects its operational efficiency, scalability, and ability to grow. It is important to assess the business ‘ need for specialized skills and resources to achieve the company’s goals.

Companies that are engaged in intensive research, production, or service delivery may require hiring qualified professionals to work effectively and develop. At the same time, many modern business models based on information technology or remote services can operate with a minimum number of employees or even be fully automated.

Outsourcing and freelancing

An alternative to hiring full-time employees can be outsourcing or freelancing services. This allows the company to remain flexible, reduce operating costs, and still have access to a wide range of specialized skills as needed. However, when choosing such a model, it is important to take into account aspects related to quality control and confidentiality of information.

Conclusion

In general, the need to have employees in a company registered in Bulgaria depends on the specifics of the business, its goals and development strategy. At the same time, it is important for companies to comply with all applicable legal requirements and evaluate their operational needs in order to choose the most appropriate HR management model. In any case, flexibility in resource management approaches and the use of modern business practices can contribute to the successful conduct and development of business in Bulgaria.

 How do I choose a company name in Bulgaria?

Choosing a name for a company is a key step in the process of starting a business, especially in a country with such a rich cultural and historical heritage as Bulgaria. Choosing the right name will not only help your company stand out from the competition, but also play an important role in building a brand and attracting customers. In Bulgaria, as in many other countries, there are certain requirements and restrictions when choosing a company name. In this article, we will look at the key aspects and offer tips on choosing a name for your company in Bulgaria.

Study the legal requirements

Before choosing a name, it is important to familiarize yourself with the legal requirements and restrictions established by Bulgarian law. In Bulgaria, the name of a company should not mislead about its activities, be identical or too similar to the existing names of companies registered in the country. There are also restrictions on the use of certain words and expressions that may require special permission.

Compliance with the field of activity

The name should reflect the essence and specialization of your business, making it recognizable to the target audience. It should be clear and memorable so that customers can easily associate your brand with the products or services offered.

Uniqueness and checking for availability

Before you finally decide on a name, you need to make sure that it is unique. In Bulgaria, you can use online services to check names in the Commercial Register. This will avoid conflicts with already registered trademarks and company names.

Easy and easy to remember

Choose a name that is easy to pronounce, spell, and remember. This is especially important for international businesses, as your name will be used not only in the Bulgarian market. Avoid complex phrases and abbreviations that may not be obvious to the general audience.

Cultural adaptation

Given the cultural and linguistic nuances of Bulgaria, it is worth considering how your name will be perceived by the local audience. Avoid words that may have negative connotations or be misinterpreted.

Visual component

Think about how the name will look on brand materials, including the logo, website, and advertising materials. A good name adapts easily to different formats and design styles, strengthening brand awareness.

Conclusion

Choosing a company name in Bulgaria is not only a matter of compliance with legal requirements, but also an important element of the branding strategy. The name must be unique, reflect the scope of the company’s business, be easy to remember, and adapt to the cultural context. Pay due attention and thoroughness to this process, because choosing the right name will start a successful future for your business in Bulgaria.

 Business Register in Bulgaria

The Business Register in Bulgaria is a key tool for ensuring transparency and accessibility of information about legal entities and individual entrepreneurs registered in the country. This centralized electronic register is managed by the Registration Agency, which reports to the Bulgarian Ministry of Justice, and plays an important role in regulating commercial activities, building trust between the business community and protecting the interests of consumers.

Goals and functions of the Business Register

The main purpose of the Business Register in Bulgaria is to provide up-to-date, reliable information about companies, including their legal status, basic management information, authorized capital, subject matter and record history. The Register serves as an important data source for government agencies, financial institutions, business partners and investors, ensuring transparency of the business environment and helping to prevent fraud and economic crimes.

Company registration

To start doing business in Bulgaria, each company or individual entrepreneur must be registered in the Business Register. The registration process includes the submission of constituent documents, information about owners and managers, as well as payment of relevant state fees. After successful registration, the company receives a unique identification number (EIC), which is used in all official documents and transactions.

Access to information

The information contained in the Business Register is publicly available and can be viewed online through the register’s official website. This makes it possible to check the legal status of the company, its financial condition, the history of changes in the constituent documents, and other information that is important for making informed business decisions.

Business benefits

The Business Register in Bulgaria provides a number of advantages for registered companies, including legitimacy and recognition in the business community, simplification of procedures for obtaining loans and financing, as well as the ability to participate in public and private tenders. In addition, transparency and accessibility of information contribute to building trusting relationships with partners and customers.

Conclusion

The Business Register in Bulgaria plays a central role in the country’s economic life, ensuring stability and transparency of the business environment. It serves as a reliable source of information about companies, helps protect the rights of investors and consumers, and also strengthens the credibility of Bulgarian business at the international level. The importance of this tool cannot be overemphasized, as it makes a significant contribution to the development of the economy, stimulating transparent and efficient business conduct.

Furthermore, Bulgaria boasts a competitive and cost-effective workforce. The country’s skilled labour pool is not only well-educated, but also comes at a lower cost compared to many other European nations. This cost advantage allows businesses to maintain operational efficiency and competitiveness. Additionally, Bulgaria’s pro-business policies and low corporate tax rates further incentivize entrepreneurs. The government’s commitment to fostering a business-friendly environment is evident in its efforts to streamline bureaucratic procedures and reduce red tape, making it easier for businesses to establish and operate in the country.

In addition to economic factors, Bulgaria’s rich cultural heritage and diverse landscapes contribute to an appealing quality of life for entrepreneurs and their employees. The country offers a pleasant mix of historical charm and modern amenities, with picturesque landscapes ranging from mountains to beaches. The affordability of living in Bulgaria, coupled with its excellent healthcare and education systems, creates an attractive environment for individuals looking to relocate for business purposes. Overall, Bulgaria’s combination of strategic location, cost-effective workforce, and supportive business policies make it a promising destination for those embarking on entrepreneurial ventures.

If you’re considering launching your enterprise in Bulgaria, leveraging the streamlined process and favourable tax structure, our team of expert consultants at Regulated United Europe (RUE) is prepared to offer the necessary expertise to guide you to success. Proficient in both Bulgarian and EU legislation, we provide assistance in company establishment and related services, along with support in accounting and tax optimization. Secure a personalized consultation today to kickstart your new venture in Bulgaria.