Opening a Company in Bulgaria
Opening a Company in Bulgaria? If you open a company in Bulgaria you will take advantage of the lowest corporate tax in the EU of just 10%. However before you proceed with the opening you need to take some important decisions as part of your preparation and planning.
The first most important issue is to decide what kind of company you would like to register. You have to take into account some aspects of your business and the structure of your future company in order to make your decision. The most important of them are:
The size of your share-capital
In Bulgaria the lowest amount of the share-capital is just two Bulgarian Levs or one Euro.
If you register the most popular type of company – a limited liability company – your liability shall be limited to the amount of your share-capital. However, depending on the nature of your business it might be necessary to register a company with a larger size of the share-capital in order to demonstrate your professionalism to your business partners and clients.
For example, construction companies very often register a share-capital about 200 000 Bulgarian Levs (100 000 Euros).
Number of Shareholders
The size of the share-capital is often connected to the number of the share-holders and the proportion of the share-capital that each one of them would hold. The number of the shares and the total amount of the share-capital has to be carefully designed in order to fit your plan.
The simplest solution would be in case that you are the sole owner of your company, i.e. you do not have other shareholders alongside you. In Bulgaria this type of limited liability company is called EOOD. In such case, you are the owner of the whole of the share-capital of your company and you have a very wide choice regarding the size of this share-capital and the number of the shares.
In case that there are two, three or more shareholders – in Bulgaria this type of limited liability company is called OOD – then your options are limited and they are determined by the number of the share-holders and the proportion of the share-capital of the company that they would like to hold.
Responsibility of opening a company in Bulgaria
This issue concerns the role of your company’s director (-s)/manager (-s). The director/manager of the company is appointed by the share-holders to run the company, to sign documents, contract and to open bank accounts of the company and operate with the money in them in order to achieve the business targets that you set for the company. In some cases shareholders become directors of the company.
|OPENING A COMPANY IN BULGARIA – preparations||Preparation is required in advance to open a company in Bulgaria. You must decide what type of company you want to register. In this regard, you will have to take into consideration: share-capital size, liability, the number of shareholders, and responsibilities.|
|Advantages of opening a company in Bulgaria||Lowest corporate in the EU – 10%.Two Bulgarian Levs or one Euro – the lowest amount of share-capital.Stability of the national currency – the LEV is pegged in value to the euro. This makes its fluctuations predictable.|
|Defining the number of shareholders||There is a connection between the size of the share-capital and the number of shareholders. This affects the proportion of the share-capital that each one of them would hold. In this regard, it should be carefully considered.|
|Most frequently registered types of companies in Bulgaria||LLT – registered with a minimum of two partners, and they have limited liability up to the amount of their participation in the capital.In case you do not have partners, but you want to take advantage of a similar model, you can proceed with the registration of an EOOD.A third option is to register your company as its sole owner.|
Frequently Asked Questions
What must be the size of share-capital of my company?
The size of the share-capital of your Bulgarian company can be as little as 2 Bulgarian Levs (1 Euro).
How many can be the share-holders of my Bulgarian company?
The most common type of company in Bulgaria is a company with just one share-holder. However, there are many companies with two, three or more shareholders. It depends on your business planning.
As a share-holder can I sign contracts on behalf of the company?
No, the director/manager of your company can sign contracts on behalf of your company.