Corporate Law in Bulgaria
Corporate Law in BulgariaUpdated on Sunday 20th November 2016
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Investors in Bulgaria may incorporate companies and do business pursuant to the provisions included in the Corporate Law. These legal requirements encompass a variety of issues, from formation and capital requirements for companies to concluding agreements and maintaining certain business relations within the company or outside of it. The attributions of the shareholders and directors are also stipulated in this legal document.
Understanding the requirements for locally incorporated companies but also for the branches of foreign corporations is essential for doing business in Bulgaria. One of the lawyers in Bulgaria who specialize in Commercial Law can help guide you through the legal issues associated with company formation and corporate transactions.
The Bulgarian Commercial Law
The Bulgarian Commercial Law contains several chapters that treat issues like:
- business trade names in Bulgaria and changing the trade name;
- company registration and transactions with companies in Bulgaria;
- special regulations for branches in Bulgaria;
- the formation of a company or partnership;
- the Articles of Association;
- the relation between the partners in a company or partnership;
- corporate management;
For certain types of companies, like the limited liability companies, issues like the types of shares and capital increases or reductions are also discussed in the Commercial Law. It is possible to transform an existing company, under certain conditions.
Apart from observing the specific regulation for company incorporation and management, investors must also observe the corporate taxation principles in Bulgaria.
Doing business in Bulgaria
The types of legal forms used by investors in Bulgaria are the corporation (or separate Bulgarian legal entity), the branch of a foreign company or the representative office. The latter is a very simple business form, only recommended for testing the market, as it cannot engage in commercial or trade activities.
The types of companies in Bulgaria are:
- the partnership: general, limited or limited by shares;
- the private or public limited liability companies;
- the sole proprietorship.
Foreign investors commonly use the public and private limited liability companies. They require a minimum number of shareholders, and a certain minimum share capital. Our attorneys in Bulgaria can give you detailed information on the differences between two business forms and which one is best suited for a type of business, according to size and available capital.
The Corporate Law also describes the specific accounting and audit requirements, according to the type of company. All Bulgarian companies are required to keep special records of their business transactions. Foreign companies doing business in Bulgaria must be able to provide copies of these accounts translated into Bulgarian if so required.
The experts at our law firm in Bulgaria specialize in all matters related to commercial relations and transactions that take place in the country. You can contact us for more details on a specific legal issue or if you need legal representation in Bulgaria.