Company registration in Bulgaria with White and Partners: Guidance

In recent years, Bulgaria has been taking significant legal and practical measures to position itself as the most attractive investment destination in the region. These actions encompass the introduction of the lowest flat corporate tax rate at 10% and the provision of institutional support for developing new infrastructure near investment locations.

If you are interested in establishing your presence in the Bulgarian market, whether through a branch, subsidiary, holding company, representative office, or any other form, we are here to handle all the necessary formalities, including establishment, incorporation, and more. Our team will also offer comprehensive support and advice throughout the entire process.

To ensure that your foreign operations receive the right support from day one, our services include:

1. Experienced Multilingual Staff: Our team is proficient in English, Bulgarian, and Russian.
2. Local Document Processing: We handle all document processing in accordance with local legislation and in the local language.
3. Registrations with Competent Authorities: We take care of registrations with all relevant authorities, including the Commercial Register and VAT registration.
4. Bank Account Opening: With a power of attorney, we can open a bank account on your behalf.
5. Legal Address and Post Handling: We provide a legal address and handle mail handling for your business.
6. Accredited Accounting Division: Our team of certified accountants and tax advisors offer professional accounting services.
7. Comprehensive Invoicing and Bookkeeping: We take care of sales and inventory statistics, profit calculations, agent commission processing, and reporting.
8. Payroll Management: Our services include salary payments, tax withholdings, and paycheck deductions.

Registration in the Commercial Register is the initial step in establishing any type of business entity in Bulgaria. The registration process typically takes 3 to 5 days after submitting the required documents and can be done either by a lawyer or through legitimate proxy.

For changes such as appointing a new manager, altering the legal address, or adjusting the registered capital, registration is also required. Additionally, all companies registered in the Commercial Register must submit their annual financial statements by 30th June of the following year.

The most common types of commercial entities in Bulgaria are limited liability companies (EOOD and OOD) and joint-stock companies (AD) due to their attractive features, such as lower running costs, manageable administrative requirements, and limited shareholders’ liability.

For those dealing with personal data, compliance with GDPR activities is a must.

LIMITED LIABILITY COMPANY (OOD)

The limited liability company (OOD) is the preferred business form in Bulgaria. It requires only 2 BGN (approximately 1 EUR) as starting capital, and its shareholders benefit from limited liability and a straightforward corporate structure. Shares of an OOD are transferable and inheritable, but third-party transfers require approval through a notarized contract.

The OOD company is governed by:

1. The Shareholders’ General Meeting.
2. Manager(s) responsible for day-to-day operations and company representation.

Foreigners can also serve as managers of an OOD company. The Commercial Act permits both individuals and legal entities to establish an OOD, and there is no restriction on the number of shareholders. A single shareholder can register the entity as a single-member limited liability company.

The liability of an OOD company is limited to its assets, and shareholders’ liability is restricted to the amount of their contributions to the share capital.

The minimum required capital to establish an OOD is 2 BGN, and it forms the primary financing source for the company, covering incorporation expenses, accounting and administrative support, and ongoing expenses until the company becomes profitable.

Shareholders can be individuals or companies, local or foreign, and transfers of shares between shareholders are unrestricted. However, transfers to third parties involve a more complex procedure.

The governance structure of an OOD includes the shareholders’ general meeting and appointed directors. In the case of an EOOD (single-member OOD), the owner may personally handle company representation or appoint a director.

JOINT-STOCK COMPANY

A joint-stock company requires a minimum capital of 50,000 BGN to be established in Bulgaria. Unlike in an OOD, shares in a joint-stock company can be transferred without restrictions, and shareholders do not have direct ownership over the company.

The joint-stock company is governed by:

1. A Shareholders’ General Meeting.
2. A Board of Directors (one-tier management system) or a Supervisory Board and a Management Board (two-tier management system).

Foreigners can be appointed as managers of the company. Once the required documents are submitted, the company must be entered into the commercial register within the first working day following the submission.

ESTABLISHING A BRANCH OR REPRESENTATIVE OFFICE

Foreign investors can also choose to conduct business in Bulgaria through a branch or representative office.

BRANCH

A foreign legal entity authorized to conduct commercial activities under its national law can submit a branch registration application to the Bulgarian Commercial Register. As a part of the mother company, a branch is not a separate legal entity and does not require a distinct governance structure or paid-up capital. All assets and liabilities of the branch belong to the mother company.

REPRESENTATIVE OFFICE

A foreign person with the right to conduct business under their national law can establish a representative office. The application for registration is submitted to the Bulgarian Chamber of Commerce. A representative office is not a separate legal entity and cannot engage in business activities; its purpose is limited to conducting non-transactional activities like marketing and training.

Our team is always ready to provide high-quality advice and help in solving any tasks you set. Subscribe to our pages on social networks. If you have any questions, want to order services or consultations from us, then follow this link or write to us on WhatsApp/Viber/Telegram +380 98 363 6493 or call us.