Participation (membership) in a Bulgarian limited liability company (LLC, LTD) is always set up in a specific order, namely by the will of the partners (shareholders), who are involved in the company incorporation, or in case of acceptance of a new shareholder after the incorporation of the company, by the will of the partners holding shares at the time of acceptance of a new shareholder. This kind of decisions are made at the General Meeting of the Shareholders, which is the only competent body on these matters.
Tax residency in Bulgaria, where both personal and corporate income tax rates are 10 %, is a popular option for quite some time for many EU and non-EU citizens. Recently British citizens doing business and travelling in EU countries are anxious about their rights after Brexit. Over one million Brits are now already living outside the Island all over Europe.
The draft Withdrawal Agreement between the UK government and the EU envisages that British citizens will keep the right to live and work in the country where they reside at the time of the withdrawal. Both parties confirm that this has been surely agreed and further amendments in this section of the Withdrawal Agreement are not expected. Moreover, the negotiators agreed that there shall be a transitional period of 21 months (from 29 March 2019 until the end of 2020) before UK leaves the EU completely. So, according to the last draft of the Withdrawal Agreement, UK citizens residing on the basis of EU law before the end of the transitional period will maintain the residence rights they currently enjoy, under the currently applicable conditions and limitations. This protection includes also rights which are in the process of being obtained: citizens will be able to acquire the right to permanent residence after five years of lawful residence, even if the five-year period is completed after the end of the transition period. So, if you are a British citizen trading with EU partners, travelling around Europe or you are self -employed, providing services to EU clients, or you simply need to lower your taxes, and you wish to become a Bulgarian (tax) resident benefiting from current EU laws and the rights they give, you have a little time to do it.
Bulgarian trade representative office registration
Residence permit in Bulgaria for trade representatives
Trade representative office in Bulgaria can be registered and operated by any foreign company according to Bulgarian legislation. Representative offices are different from branch offices. They can be used only for marketing and advertising of products or services of the mother company. They are not allowed to trade on their own account, any sales are made directly by the mother company, but they can hire staff and keep their own accounting records. All expenses for the maintenance of the representation are also covered by the mother company.
Obtaining Forex license in Bulgaria
Bulgarian Forex broker MiFID EU passporting
Bulgarian Forex license gives right to the broker to operate within the entire EU either by free providing of services or through opening a branch.
Companies that want to operate Forex business platforms in Bulgaria should be registered as investment intermediaries and licensed by Bulgarian Financial Supervision Commission. They work under the European MiFID which has been implemented in Bulgarian legislation and financial institutions are regulated by the directive with some national specifics.
There are two types of Forex licenses in Bulgaria which are applicable to brokers, depending on the type of activity:
Participation is a commercial company implies various rights to the shareholders, the main being the right to dividend. According to Bulgarian Commercial Act shareholders in a Limited Liability Company are entitled to receive part of the profits in the form of dividends. Distribution of interim dividends (based on current year profits) is prohibited. Companies are allowed to distribute only accumulated profits from past fiscal years.
In the common practice the balance profit is distributed among the shareholders in proportion to their shares. In other words, if in a limited liability partnership there are two partners each holding 50 %, that means that they will receive equal share from the profit, unless otherwise agreed. “Unless otherwise agreed” is a key phrase here, as it gives opportunity to shareholders to stipulate different shares of profit. These stipulations shall be made in writing on the company’s Articles or Operating Agreement. So, practically there are no legal limitations to disproportional distribution of profits in a Limited Liability Company, in case all shareholders agree on that. In all cases, in order to be effective and legally binding, the decision for distribution of profits in the form of dividends should be taken by the General Meeting of Shareholders and duly recorded in writing in the company’s documentation.
The procedure of registration and re-registration of non-profit organizations and foundations in Bulgaria has been significantly changed with the new amendments of the Non-profit Legal Entities Act. The changes were published in Bulgarian SG in 2016.
From 2018 on all Bulgarian non-profit organizations shall be entered into a special Non-profit Legal Entities Public Register of Bulgarian Registry Agency. Presently registration is made at the District Court by the seat and registered address of the entity and there is not one unified register where the status of the non-profit entities can be checked.
Relocating to Bulgaria after Brexit is an option considered by more and more Britons. Moving business to Bulgaria is another option which more and more European and worldwide businessmen are taking advantage of.
Bulgaria is an EU member since 2007. Continued financial stability, lowest corporate income tax in Europe (10%), lowest cost of labour force combined with highly educated work force are only a few of its credits. That is why it is not a surprise why UK and other EU companies already started to study the opportunities to use Bulgaria as a safe harbour for relocation of their business.
The procedure of registration of recruitment / employment agencies in Bulgaria is regulated under Bulgarian Employment Promotion Act and Ordinance on the Terms and Conditions for Conducting Mediation in Employment.
Offering any of the intermediation employment and recruitment services listed below requires obtaining a registration certificate before starting the activities. These activities are:
- Consulting job seekers and employers
- Professional training
- Referral to appropriate employment programs
- Support to job seekers for starting work
- Offering job positions on behalf of various employers
The certificate of mediation activity is issued by the Minister of Labour and Social Policy but the application is actually filed with Bulgarian Employment Agency. Along with the application form, the recruitment agency applicants should provide a list of documents proving that their company matches the requirements prescribed by Bulgarian and European legislation such as: education of manager and employees of the company, certificate of good standing, certificate of clean tax record of the company, certificate of registration with the Personal Data Protection Commission as well as drafts of the intermediation contracts the company will offer to employers and job seekers.
Gambling licence in Bulgaria is the best and most cost effective solution in the whole EU. Especially when it comes to online gambling which could in fact be managed from abroad and not necessarily from Bulgaria where the licence has been obtained. Bulgarian Gambling Law requires that the owner of the company that will provide online gambling to be either a Bulgarian or an EU national. The same requirement is if the shareholder is a legal entity. If a non-EU company plans to obtain such licence, it should incorporate another EU company first and then the new entity can be the shareholder of the Bulgarian company that will organize the online gambling.
There are four available options for fuel oil trade in Bulgaria, either by foreign or Bulgarian companies.
The first option includes receiving of excise goods (like fuel) on the territory of Republic of Bulgaria, which have been released for consumption on the territory of an EU member state. This means that the excise needs to be paid to the member state from which the excise goods are bought. After the goods arrive in Bulgaria and the excise is paid again to the Bulgarian authorities (it is obligatory and in order to be avoided the double payment of the excise) the seller could return back the paid excise. Then the seller could return this amount to the buyer – the actual payer of the excise. In this case: