Category Archives: Doing Business

EU insurance agency – registration of insurance broker or agent in Bulgaria

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EU insurance agency can be set up via one of the following two formations in Bulgaria – an insurance broker or an insurance agent. These two types of insurance intermediaries are legally defined in Bulgarian Insurance Code in accordance with current EU legislation.

The figure of EU insurance broker registered in Bulgaria includes more options for independent work with many insurance companies and for that reason the requirements for its registration are stricter. They differ from the requirements imposed to the insurance agents. The most specific requirements imposed to Bulgarian insurance brokers are connected to the financial security and financial stability of the broker. First of all the broker must permanently provide the obligatory Professional Liability insurance valid on the territory of the entire European Union. The minimum insured amount shall be at least BGN 2.2 million for each insured event or BGN 3.3 million for all the insured events for one year. The second requirement relates to the financial stability of the broker. According to Bulgarian Insurance Code the performance of the obligations of the broker shall be secured by one of the following means: read more

Open bank account in Bulgaria for offshore company

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Opening a bank account in Bulgaria for an offshore company? This is not a problem since Bulgarian offshore company formation followed by opening a bank account is a straightforward process which takes only a week time. The costs are minimal too.

But first one should know that Bulgaria is not a typical offshore zone. It is more of a tax haven. In simple words – you get the best from an offshore and a ‘normal’ company registered in EU. From legal point of view Bulgarian offshore companies are ‘normal’ companies, publicly registered and legally operating all across Europe and the world. They are registered under EU jurisdiction which means that they benefit from all EU financial and tax regimes. And from purely psychological point of view they are much more prestigious – because everyone would prefer to deal with an EU based company, which is publicly registered and strictly regulated under EU legal framework – rather than deal with a typical offshore company, which by default hides many details about its business activities, real owners, etc. read more

E-commerce in Bulgaria – online store requirements

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Running an online e-store and selling goods or services worldwide while paying the lowest corporate tax in the world? If this idea has already come up to your savvy business mind please search no further – Bulgaria is the place for setting up a limited company and conducting EU based e-commerce activities while paying only 10% tax, no matter where you are selling / shipping goods / services to!

Just like anywhere around the world, setting up an online web shop in Bulgaria does not require the availability of an offline store although you still have to register a Bulgarian company which will receive payments, issue electronic invoices, etc. The e-store is a computer software that provides the merchant (trader) with the opportunity to easily and quickly publish information for his goods on the Internet – and respectively sell goods / services and make profit. Although most legal requirements for traditional offline commercial activities apply for e-trade, some special rules need to be implemented. Applicable are mainly Bulgarian E-commerce Act and The Consumers Protection Act as well as other laws. read more

Bulgarian property laws in the business environment in Bulgaria

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Bulgarian property lawyers and real estate solicitors legally advise and act on behalf of foreign investors who might have any needs or legal issues regarding property law in Bulgaria – construction of production units, purchase or lease of office premises, etc. Bulgarian property law consists of many different acts and regulations, some of which unfortunately not fully synchronized with European legislation or even one with each other. This brings the necessity of very careful examination of all relevant laws. read more

EU transport licence via Bulgarian haulier company registration

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If you wish to register as a haulier transport company in Bulgaria and to operate on the territory of the entire European Union, you will need the Community License for road haulage.

This licence is granted by Bulgarian minister of transport, information technologies and communications through Transport Administration Executive Agency. In order to apply for a licence you need to incorporate a Bulgarian limited liability company or a sole proprietor with main activity carrying of goods for third parties, for hire or reward. read more

PSD2 license for payment institution, e-money and payment system providers in Bulgaria

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E-money, payment institutions, payment systems, online payment system providers – at a first glimpse all these terms look similar, but in fact they refer to different issues regulated by:

  • Bulgarian Law on Payment Services and Payment Systems,
  • Directive 2007/64/EC of the European Parliament and of the Council of 13 November 2007 on payment services in the internal market (amending Directives 97/7/EC, 2002/65/EC, 2005/60/EC),
  • Directive 2009/110/EC of the European Parliament and of the Council of 16 September 2009 on the taking up, pursuit and prudential supervision of the business of electronic money institutions (amending Directives 2005/60/EC and 2006/48/EC and repealing Directive 2000/46/EC) and
  • Latest PSD2 Directive 2015/2366/EU of the European Parliament and of the Council of 25 November 2015 on payment services in the internal market, amending Directives 2002/65/EC, 2009/110/EC and 2013/36/EU and Regulation (EU) No 1093/2010, and repealing Directive 2007/64/EC.

The above documents regulate the requirements to the payment service providers which, apart from banks, inclusive European Central Bank and the national central banks of the member states, can be two types:

  • Payment institutions
  • Electronic money institutions

From 13 January 2018 all EU member states are obliged to apply the rules of PSD2. In October 2017 Bulgarian government proposed amendments to payment service legislation which are expected to be adopted by Parliament by the end of the year. Since new procedure and requirements have not been announced yet, the article below gives only basic guidelines on the matter based on current laws. read more

Registration of tour operators and travel agencies in Bulgaria

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Bulgarian travel agency or tour operator businesses can be conducted only by Bulgarian companies that are listed in the Register of Tour Operators and Travel Agents, part of Bulgarian National Tourism Register. The registration is made with the Ministry of Economy, Energy and Tourism upon filing an application by the candidate together with a number of documents confirming that the applicant matches the criteria specified in Bulgarian Tourism Act and sub delegated legislation. Below we have summarized some of the basic registration requirements prescribed in Bulgarian Laws. read more

Insolvency in Bulgaria – bankruptcy laws & proceedings

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Bulgarian bankruptcy / insolvency proceedings are regulated by Bulgarian Commercial Act. The first thing one should bear in mind is that bankruptcy and insolvency in Bulgaria are synonyms and mean absolutely one and the same thing from legal point of view.

There are two legal grounds for opening bankruptcy proceedings in Bulgaria – insolvency or over-indebtedness (the second rule applies only to limited liability companies, stock corporations or companies limited by shares). According to Bulgarian Commercial Act insolvent shall be deemed merchants who are unable to meet outstanding capital obligation under a commercial transaction or public duty to the state and the municipalities related to the merchant’s commercial activities, or private state obligation. The insolvency shall be assumed when the debtor has stopped his payments. Insolvency may be present also when the debtor has paid or is in position to pay partially or in full only the claims of individual creditors. An interesting detail is that bankruptcy proceedings shall be deemed automatically opened as well as for any unlimited partner in an insolvent company in Bulgaria. Bankruptcy proceedings can also be opened for deceased or even deregistered merchant – physical person if before his death or deregistration from Bulgarian Commercial Register he has been insolvent. read more

Business for sale in Bulgaria – benefits and risks

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If you are interested in doing business in Bulgaria and you search the web for an overview of potential investment opportunities, you will notice a large number of offers for businesses for sale in Bulgaria, including many listings of hotels, bars and restaurants at Bulgarian seaside or in mountain ski resorts.

The reason for that abundance of hotels and restaurants for sale is simple. The boom in both construction and tourism a few years ago led to thousands of new hotels and developments in the resorts. Most of the developments, however, were financed by bank loans and mortgages. Due to the global financial crisis some of the investors were not able to pay their credits to the banks any longer and facing the option to lose everything they chose to sell the entire business or some part of it. read more

Payday loans license for short term loans direct lenders in Bulgaria

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Contrary to the common European practice, Bulgarian Law of Consumer Credit Protection is not applicable for loans under BGN 400 (a little more than EUR 200) and in case the loan is for up to three months. Currently these loans are outside the scope of this protection law and there are no limits. Although the government has been considering changing the law, this has not happened up to date so any companies that work in the field of micro loans can take advantage of the delay in regulating these micro loans. Currently most companies offer such micro loans with around 35% monthly interest that makes more than 400% per annum, which is much more as compared to other European countries. read more