Company setup in Bulgaria: procedure, tips and tricks
Setting up your company in Bulgaria is not a difficult task. E-government in Bulgaria may not be fully implemented but as far as company formation is concerned – the registration can be concluded almost entirely remotely and online.
Prerequisites for company formation
Everyone can set up a company in Bulgaria regardless of citizenship or residency. You however, to be at least 18 years old to open your business in Bulgaria and have a valid ID or international passport. There are several things to consider before you initiate a company registration procedure:
- Your company must have an address in Bulgaria;
- Your company needs to have initial company capital which has to be deposited in a local bank;
- You must chose name and scope of activity for your company.
The company registration procedure usually takes ~1 week if you visit Bulgaria and up to 4 weeks if you choose a remote registration.
When you set up a company in Bulgaria, it will be registered in the Commercial register. More on this below. The register is public and access to it is free and simple. This means that certain company data will be visible to everybody and can’t be hidden.
At first, you must choose a name for your company. Under Bulgarian law the primary company name must be written in cyrillic letters. Most foreign citizens are not familiar with the Bulgarian alphabet and would rather pick a name in English. In you also prefer this option, you should find someone to transliterate the chosen name in Cyrillic.
As mentioned above if you want a company in Bulgaria, it must have a local address. You don’t need to own or rent a place. There doesn’t even need to be an actual office at the company address. However, it must be an actual address and this address will be used for all sorts of official correspondence with authorities and especially with the National revenue agency (NRA). The are companies in Bulgaria that offer a “virtual office” service, namely lending their address for the registration purpose for a small price (~€35) on a monthly basis.
The general scope of activity is also considered part of the company data. The scope of activity doesn’t need to be too specific. It can be as vague as you like and is generally used as indicator for the type of business run by the company. For example you can just put “software development and information technologies” as a service for basically all kind of tech business in Bulgaria.
Your data as company manager and owner will also be visible in the commercial register. Nominee director services are not really popular in Bulgaria since appointing a nominee director or owner constitutes a huge risk for the ownership of your business. There are however, companies that will offer you this type of service if you want your data to remain hidden.
The last element of the public company data is the company capital. Bulgaria law requires limited liability companies to have an initial capital of at least €1. Whether you opt to put a higher capital is up to you.
Before the company registration
Before you start the registration procedure, you need to draft and sign or acquire the following documents:
- Articles of association;
- Founding protocol for the company;
- Signature specimen of the company manager;
- A couple of template declarations provided by the Registry agency;
- Bank statement for the company capital;
- Payment order for the state registration tax
All documents must be in Bulgarian. If any of the documents is in a foreign language it must be translated and legalized in Bulgaria. In order to acquire the bank documents and the signature specimen you must visit a local bank and a notary and we will focus on these two steps now.
Opening a company account
In order to deposit the company capital you must open a special type of account – something like a depozit account used specifically for the company capital. This account is created by the company owner before the registration. The owner himself must deposit the capital. The bank must be a local one. If you don’t want to visit the country for the company registration procedure you can authorize someone else to open the account and deposit the company capital on behalf of you. This can be done through a power of attorney with a notarized signature. This leads us to our next mandatory step prior to the registration procedure.
Visiting a notary
The signature specimen of the company manager must be put on a special document which also constitutes the manager’s consent to become a legal representative of the company. This document is signed in front of a notary. This has to be a Bulgarian notary. However, Bulgarian embassies and consulate offices abroad perform notary duties for Bulgarian and foreign citizens abroad. So, if you want don’t want to visit a local notary, you can always call the local Bulgarian embassy or consulate office to use the notary services.
Fees and other expenses
The state fee for company registration in Bulgaria is €28 if you file the documents online. Apart from that you will need to prepare €3 for a local notary and €5 bank fee for opening an account. If you chose a remote registration you have to consider that the embassy may charge something ~€40 for notary services and you will also need to mail the signed documents to Bulgarian which can add up to ~€30. In total the registration of your company shouldn’t cost more than €100 with all fees and taxes combined.
Tips and tricks
Here are some useful tips and tricks for your company setup in Bulgaria.
- Make your company capital at least 100 BGN. This will allow you to easily transfer capital shares in the future to third parties;
- If you don’t have access to a Bulgarian embassy or consulate office you can also visit a notary in your country and put an apostille on the notary seal;
- UniCredit Bulbank is part of the UniCredit group and the most prominent bank for corporate clients in Bulgaria;
- Use bilingual documents with a Bulgarian translation to avoid translation and legalization fees;
- Hire a local accountant immediately upon registering the company;
- VAT registration is not automatic with the company registration. It is a separate procedure which is most often concluded by accountants.
Rights and obligations of shareholders and managers
Changes in the company
Trade representation office
Taxes for doing business in Bulgaria
Opening of a Bulgarian Trade Representative Office (TRO)
Liquidation of a Bulgarian company
Opening a company bank account in Bulgaria
Change to the company’s capital
Change of the company’s name