Commercial and corporate law

Company formation: OOD, EOOD, AD and branches of foreign companies

The choice of legal form determines the owners’ liability, how decisions are taken and how easily new partners or an investor can be brought in later. The limited liability company (OOD, or EOOD where there is a single owner) is the usual vehicle for small and medium-sized businesses; since the introduction of the euro its minimum capital has been EUR 1. A joint-stock company (AD) requires capital of at least EUR 25,000 and a heavier governance structure, but it suits a business with several investors or a planned public offering.

The real work in setting up a company lies not in the application but in the articles of association. They settle the majorities required for particular decisions, what happens when a partner dies or leaves, the conditions for transferring shares to third parties, and the rules under which the manager may enter into significant transactions. Standard templates are usually silent on these points, and the gaps come to light only at the first disagreement between the partners.

A foreign company may register either a branch, which is entered in the Commercial Register and Register of Non-Profit Legal Entities and may carry on business, or a commercial representative office, which is registered with the Bulgarian Chamber of Commerce and Industry and may not trade. Documents from abroad must be legalised or apostilled and translated into Bulgarian. We work with foreign clients in English, Russian and German.

Registration requires:

• articles of association, memorandum or statutes, depending on the chosen form
• the decision appointing the manager, with the manager’s notarised consent and specimen signature
• the declarations required by the Commerce Act and, where required, the beneficial ownership details
• evidence that the capital has been paid in
• the application for registration, filed electronically with a qualified electronic signature

In detail: Registering a company in Bulgaria: documents, timelines and what foreign founders should know

Capital in euro: bringing the articles and statutes into line by 31 December 2028

Since 1 January 2026 the euro has been Bulgaria’s official currency. Between January and March 2026 the Registry Agency converted, of its own motion, the registered capital of limited liability companies, joint-stock companies and partnerships limited by shares at the fixed rate of BGN 1.95583 to EUR 1. The conversion does not affect the rights of partners and shareholders, but nor does it change the constitutional documents themselves: in them, the capital and the value of the shares are still expressed in leva.

The Act on the Introduction of the Euro in the Republic of Bulgaria requires companies to amend their articles of association or statutes. An amendment published in State Gazette No 82 of 8 September 2026 extended the period from 12 to 36 months, that is, to 31 December 2028. The updated document is filed for publication together with the next application for which the law requires the articles or statutes to be enclosed, for example on a change of name, seat, partners or capital. No state fee is payable for the publication.

The converted capital is rarely a round figure, and the value of an individual share often runs to fractions of a cent. For OOD and EOOD companies the law allows the capital to be changed by up to 5 per cent, where needed to preserve the partners’ rights, under the procedure for amending the articles and without the rules on capital increases and reductions. In companies with many partners or unequal holdings, the rounding method needs to be calculated in advance so that the ratio between the holdings does not shift. We recommend using the amendment to review outdated clauses in the articles as well.

In detail: Capital in euro: how Bulgarian OOD, EOOD, AD and KDA companies update their articles by 2028

Transfer of company shares and of a business as a going concern

A share in an OOD may be transferred to another partner or to a third party, provided the third party is admitted by resolution of the general meeting. The contract must be in writing, with signatures and content notarised simultaneously, and is entered in the Commercial Register (Art. 129 of the Commerce Act). With the application, the manager and the transferor declare that the company has no unpaid wages or social security contributions that have fallen due. From 2 April 2027 the registration officer will also check electronically with the National Revenue Agency whether the company and the transferor owe any social security contributions subject to enforcement (Art. 129(2) of the Commerce Act, as amended in State Gazette No 69 of 2026).

Form is the last step. Before signing, we check the articles for transfer restrictions, whether the shares are encumbered by a special pledge or an attachment, pending proceedings and the company’s liabilities, and whether the seller’s capital contribution has been paid.

Shares in a joint-stock company follow a different regime: registered shares are transferred by endorsement and entry in the register of shareholders, and dematerialised shares through the Central Depository. Where the subject of the deal is the whole business as a going concern, Article 15 of the Commerce Act applies: a written contract with notarised signatures and content, entry in the Commercial Register, and notice to creditors and debtors. Unless otherwise agreed with the creditors, the transferor remains jointly and severally liable with the transferee for the liabilities of the business, up to the value of the rights received (Art. 15(3) of the Commerce Act). Where the business includes real estate, the contract is also entered in the Property Register.

The transaction usually involves:

• legal due diligence scaled to the value of the transaction
• a transfer agreement with seller warranties, conditions and a payment mechanism
• general meeting resolutions and amendments to the articles
• notarisation and the application for registration
• disclosure of the new beneficial owners, where required

In detail: Transferring shares in a Bulgarian OOD or EOOD: steps, documents, fees and tax

Changes in the Commercial Register: refusals and appeals

The registration officer checks whether the required documents have been attached to the application and whether the circumstance to be registered follows from them. The minutes of a general meeting, or the decision of a sole owner, must therefore match the law and the articles precisely as to convening, quorum, majority and agenda. A refusal often results not from a difficult point of law but from such a mismatch, a missing declaration or a defective notarisation.

Where there is a deficiency, the officer may give instructions for it to be remedied within a short time. A refusal may be appealed to the regional court for the company’s seat, and that court’s decision to the court of appeal. Where a circumstance has been registered on the strength of a forged document or a resolution that was never adopted, any third party with a legal interest may bring an action for a declaration that it does not exist, under Article 29 of the Commercial Register and Register of Non-Profit Legal Entities Act.

We prepare the documents in line with the register’s requirements and, if an application is refused, assess whether to appeal or to file afresh.

In detail: Company changes in a Bulgarian OOD or EOOD: new manager, address, name, objects and partners

Mergers, divisions, conversions and liquidation of companies

The Commerce Act governs mergers by formation of a new company and by acquisition, divisions and spin-offs, as well as changes of legal form. A transformation requires an agreement or plan, reports by the management bodies, in most cases a review by an independent auditor, and resolutions of the general meetings of the companies involved. It takes effect on entry in the Commercial Register, from which point the receiving or newly formed company succeeds to the relevant assets and liabilities. Cross-border mergers were already regulated, and since 2024 (State Gazette No 82 of 2024) the Act has also governed cross-border conversions and divisions involving companies from other EU Member States, including the transfer of a registered office to another Member State.

When a company is dissolved, other than by transformation or insolvency, it goes into liquidation. The liquidator is entered in the register, sends a written call to known creditors and publishes it in the Commercial Register. Assets may be distributed to the partners no earlier than six months after the call is published (Art. 272 of the Commerce Act). Since 2024 the law has also provided, under certain conditions, for a fast-track liquidation procedure in which assets may be distributed three months after the call to creditors is published (Art. 274a). If it emerges that the company cannot pay its debts, the proper course is insolvency proceedings, not liquidation. We coordinate the procedure with the company’s accountant, including the statements and returns filed before the company is struck off and the final corporate tax return, due within 30 days after it.

In detail: Liquidating a Bulgarian OOD or EOOD: steps, deadlines, taxes and fees

Shareholder disputes and managers’ liability

Disputes between partners affect the management and value of a company for as long as they last. The remedy most often used is an action to set aside a resolution of the general meeting under Article 74 of the Commerce Act. It is brought before the regional court for the company’s seat within 14 days of the meeting if the partner attended or was duly invited, and otherwise within 14 days of learning of the resolution, but no later than three months after the meeting. The time limit is preclusive and cannot be restored once missed.

A partner who fails to perform their obligations may be expelled after a written warning, and any partner may withdraw by written notice and receive the value of their share. Managers are liable to the company for damage caused in the course of management (Art. 145 of the Commerce Act); board members of a joint-stock company bear similar liability. Some disputes can be resolved faster through mediation: Iva Petkova has been entered in the Unified Register of Mediators since 2023. Filena Pavlova, an attorney who joined the team in October 2025, is also a mediator and works on corporate law and litigation. Nikolay Arabadjiev, a lawyer experienced in corporate governance, works on internal governance rules, conflicts of interest and the liability of management bodies.

The most common proceedings:

• actions to set aside general meeting resolutions (Art. 74 of the Commerce Act)
• actions for a declaration that a registered circumstance does not exist (Art. 29 of the Commercial Register Act)
• expulsion of partners and disputes over the value of a departing partner’s share
• damages claims against managers and board members
• disputes under share purchase agreements

In detail: When a company cannot pay: a director’s duties in Bulgarian insolvency