One of the main questions which is quite normally for one to ask is about the competent body, authorized by the Bulgarian state to deal with the process of the registration of newly established companies. And the answer is very straightforward вЂ“ once this was within the powers of 29 Bulgarian Regional Courts while now there is only one body which is empowered to keep record of all activities of all commercial companies in Bulgaria вЂ“ and this is the Commercial Register, known also as the Trade Register.
According to Bulgarian Law every new single trading company in Bulgaria which has successfully passed the respective company formation procedure is subject to registration with the database of the said agency. If the owners or shareholders do not apply for registration, then it is considered that there is only a contract between all founding members but not duly formed commercial legal entity. In which case there is nothing that those founders could do on behalf of the company.
The Commercial register is a public one and hence keeps a public electronic database in which every single person who has internet access could do a check on the companyвЂ™s status. Unfortunately the interface is only in Bulgarian which makes is virtually impossible for foreign people to undertake such sort of checkups. Another thing worth mentioning is that not all data in the register is public вЂ“ only the most important details are so. In order to perform a deep research on the available database, one should have an e-signature вЂ“ in which case absolutely all available data is given to the client. This was a recent chance in Bulgarian legislation since a number of fraudulent cases broke out in Bulgaria in the last couple of years. This is sort of a precaution measure which has to prevent unauthorized (anonymous) access to the remote servers.
There are not so many costs involved in the news Bulgarian company establishment process but keep your eyes open as there might be some hidden ones which could turn up at later stage.
The inevitable expenses are related to the state fees collected by Bulgarian company register. If you don’t pay, you don’t get registered, even if your company has been perfectly formed. The good news is that this fee is not big at all – less than 50 Euros in total. Or even less if you choose to pay via internet payment service provider. Bulgarian government is taking steps aimed towards full e-government access.
Payments may be made both from Bulgaria and from abroad. Via bank transfer or other means. The final result is important – which is result is the due amount in the bank account of Bulgarian Commercial Register. In all cases hard (paper) copies have to be presented (physically or scanned) to the Register because otherwise the registration will be denied.
The next thing one should bear in mind when it comes to expenses for company formation is the legal fees, i.e. the remuneration which you pay to the corporate lawyers to get your papers drafted and ready to be submitted. This expense is not mandatory since it is not obligatory for one to use legal services. Every entrepreneur can prepare his very own set of document related to the establishment of the corporate entity. However practice shows that in most cases investors use the services of solicitors especially when they are not in good command of Bulgarian language.
Another budget option which is quite unpopular due to the many risks it hides is to hire a paralegal or a person who has nothing to do with Bulgarian law to prepare the company setup documentation. In this case the price is of course lower or even much lower but there is absolutely no guarantee that the work will be done at all. Or if it is done – that there won’t be any hidden expenses (additional costs, fines or other type of problems) that will explode months or even years later due to the unprofessional work undertaken by the aforementioned persons.
Open company in Bulgaria and start doing business.
Lowest taxes and running costs and other benefits of companies registered in Bulgaria.
Open company in Bulgaria and then immediately start doing business is a quite common option recently. Many foreign businessmen have already learned over the internet the enormous benefits which a registered Bulgarian company offers to its owners.
To start with, if you set up a company in Bulgaria, you will directly enter the European tax free market. Many foreign companies from Asia, Africa and Americas have already cloned their business in Bulgaria but now even businessmen from other EU countries are starting to flow to Bulgaria in search of better working and tax conditions.
Bulgaria has the lowest corporate tax rate in the whole European Union amounting to only 10 %! And the dividends tax is only 5 %, calculated on the basis of the net profit of enterprises. This makes some foreign analysts classify Bulgaria as a sort of tax haven and refer to Bulgarian companies as offshore ones. Some companies in Bulgaria have even started importing CEOs and other employees since the personal income tax in Bulgaria is amounting to only 10 % (flat rate). So no matter whether someone is running or working for a company in Bulgaria, he still pays only 10 % of the company or his personal income.
Company formation in Bulgaria is a relatively easy process. It should however be conducted in Bulgaria and this is why it is practically impossible for a foreign businessman for set up a new Bulgarian company personally. The good news is that there are many professionals (lawyers, etc.) who offer Bulgarian company registration services at fair and more than reasonable prices. For only a couple of hundred Euros a foreign client can get a fully functional newly registered company, incl. bank accounts, VAT / VIES numbers, etc. For the same price one can even buy a ready-made company in Bulgaria. Shelf companies and becoming even more popular these days.
The running costs of an established company in Bulgaria are very minimal. The absolute minimum is the obligation of each company to file annual tax return, even if no business has been conducted over the past year. This is usually carried out by accountants who charge as little as say 100 Euros. Company address in another common option for a company in Bulgaria at the same price. Some businessmen prefer to pass their lawyer’s or accountant’s address to the Commercial Register so that they are sure that will not miss a postal or other delivery.
The list of all benefits that a company in Bulgaria offers is long enough and many have already personally tested it. If you are considering staring a Bulgarian company, then you should not wait any longer because the business conditions are quite perfect right now!
Bulgarian company formation procedure at hand.
Business immigration via company setup in Bulgaria.
Bulgarian company formation is a straightforward process which in any case costs very little. All related to the business immigration to Bulgaria, incl. the registration of a Bulgarian company expenses are amounting to no more than some hundred BGN (Bulgarian Levs, EUR 1 equals BGN 1,95). The time frame is also pretty favourable.
Bulgarian company setup procedure usually starts with the client sending his/her personal details (i.e. date of birth, passport details, etc.) to the supervising attorney who is in the respective case in charge with the incorporation. This could eventually be undertaken by other Bulgarian professionals but it is more than strongly recommended and practice shows that definitely a trustworthy lawyer is the best option for representing a single or a group of foreign clients who have decided to open a new commercial company in the process of business immigration to Bulgaria. As previously advised above, the expenses and respectively the whole amount of funds forwarded to the professional person who is conducting the case are not big but there are so many cases in which it turns out that the cheap-but-not-so-trustworthy legal or paralegal representative of the foreign client simply vanishes with all the clients’ assets and money.
When every time using the professional services of a proxy which appears to be the common case the respective business owner investing in Bulgaria shall at first place sign a Power of Attorney which would be in favour of the empowered person. The given rights in it regarding company setup could vary from only filing the prepared incorporation documents to Bulgarian Trade Register to undertaking all related legal actions, incl. opening of Bulgarian bank accounts and operating with funds.
Next step is preparation of all related to the business immigration documents. Most experts prepare customized documents on the basis of the case specific needs and requirement of the business but surely there are some persons who would prefer using different and sometimes outdated templates for ready-made Bulgarian company incorporation. When registering any kind of Bulgarian company, it is always a wise idea to first discuss with the respective business owner his investment plans at least for the very near future. As it might eventually turn out that a Limited Liability Company in Bulgaria has been duly established but then the main shareholder decides to apply for a licence which could eventually require a mandatory Joint Stock Company.
Company formation in Bulgaria is concentrated entirely on the relation between the applicant (or respectively his legal representative) and the respective Trade Register. There are no Court, Notary or any other special proceedings. When the incorporation documents get duly prepared they are immediately filed with the Commercial Register and then in most cases it usually takes between 3 and 7 days for the commercial registration procedure to finally complete.
When the company setup gets finalized then there is only one legal thing left to do – get a Certificate for Good Standing of the newly registered Bulgarian company. Then business operations can start. The mere holding of this very certificate is definitely not mandatory as it can be found online on the internet but foreign investors know that in practice it usually is required and demanded. Company stamp is another important thing that a Bulgarian commercial company can do without but only from legal point of view – as it is practically impossible and cannot do without from practical point of view.
So when the Bulgarian shareholder/s has all these required documents at hand he can take further steps aimed towards growing and expanding the business – obtaining licenses, registering for VAT, etc.