Are you prepared to exploit the lively Bulgarian labor market? Adding a new country to your business is an exciting project, and becoming an employer in this vibrant European market is easier than you can imagine. This guide walks you through a detailed step-by-step process, ensuring you're well-prepared to introduce your business to Bulgaria.
Bulgaria brings skilled talent with high competitiveness and a strategic location inside the European Union. This distinguishes Bulgaria as an excellent place for setting up a branch office or hiring remote workers, and knowledge of the registration process may ease the entry process into the Bulgarian market.
This guide will cover the selection of business structure, including all the necessary paperwork involved, making use of modern solutions such as eBranch services and virtual office options. Let's get started on your Bulgarian business adventure!
Recognize Bulgarian Business Systems
There three primary choices for your company structure when you are growing your business into Bulgaria:
Limited Liability Company (OOD)
For Bulgarian foreign investors, the OOD is the most often used option. Establishing it with a single shareholder calls for a minimum capital investment of merely 2 BGN (about €1). A versatile and reasonably priced structure, the OOD provides minimal liability protection.
AD, or Joint Stock Company
The joint-stock company (AD) form could be better appropriate for bigger-scale activities. An AD must have at least two shareholders and minimum capital of 50,000 BNG, or roughly €25,000. Often utilized for public enterprises, this framework gives better access to capital markets. ADs can select a two- tier (Supervisor Board and Management Board) or a one- tier (Board of Directors) management arrangement.
Sole Proprietorship (ET)
Those seeking a straightforward, low-cost solution could take under consideration registering as a single proprietorship (ET). Owned and run by one person, an ET has no minimum capital requirements. Small enterprises and freelancers would find this structure ideal, but since their personal assets are connected to the company, the owner has infinite liability.
Consider elements including your industry, growth ambitions, funding requirements, and liability issues when deciding on your company form. Usually the most popular and adaptable choice for international businesses joining the Bulgarian market is the OOD. Whichever your decision, make sure to check local legal and tax advisers to guarantee adherence to all pertinent rules.
Here's a quick comparison of the main business structures available in Bulgaria:
Feature | OOD (Limited Liability Company) | AD (Joint Stock Company) | ET (Sole Proprietorship) |
Min. Capital | 2 BGN | 50,000 BGN | None |
Liability | Limited | Limited | Unlimited |
Management | Simple | Complex (One-tier or Two-tier) | Simple |
Best For | SMEs | Large Corporations | Individuals |
The exciting part is that with modern solutions like eBranch services, you can register any of these structures without needing a local entity or PEO. You can also opt for a virtual office setup to maintain a professional presence while keeping costs low.
For most international businesses entering the Bulgarian market, would recommend the OOD (Limited Liability Company) structure. It offers the perfect balance of flexibility, liability protection, and manageable startup costs, making it the most popular choice for foreign investors.
Choose Your Company Name
Time to tackle one of the most exciting parts of setting up your Bulgarian business - choosing your company name! Bulgaria makes the name reservation process straightforward and accessible.
Name Reservation Process
To secure your chosen company name in Bulgaria, you can go through the Registry Agency's website or file in person. The key details are:
The name reservation process gives you a 6-month exclusive right to your chosen name.
The filing fees are:
Online filing: 20 BGN
In-person filing: 40 BGN
Given its speed and cost, the online filing choice is advised. You will need a qualified electronic signature to file online, and the convenience it offers justifies the investment in time.
Through this simple procedure, you can reserve your company name and guarantee that your brand identity is safeguarded and ready for the following phases of building your business presence in Bulgaria.
Legal Requirements For Company Names In Bulgaria
When choosing a company name for your business in Bulgaria, there are specific legal requirements based on the business structure:
Business Type | Name Requirements |
OOD (Limited Liability Company) / EOOD (Single-Member Limited Liability Company) | The name must include "OOD" or "EOOD" |
AD (Joint-Stock Company) | The name must include "AD" |
ET (Sole Proprietorship) | The name must include the personal and family name of the owner |
In addition to these structure-specific requirements, there are a few other important rules to keep in mind:
The firm name has to be written in Bulgarian (Cyrillic) alphabet.
The name might also incorporate a variant in another language.
The name cannot be deceptive or destructive for public order.
The name has to be original on the Bulgarian market.
See whether your company name is available on the website of the Commercial Register before deciding on it. Should you still be unsure, you can reserve several name choices.
The good news is that you may manage the whole name reservation procedure remotely, without a local business or PEO, using contemporary options like eBranch services. This guarantees that your company name satisfies all legal criteria and helps you to create your commercial presence in Bulgaria more easily than ever.
Recall that the basis of your firm identity in the Bulgarian market is not only legal formality but also your company name. Choose deliberately to leave a lasting impression.
Prepare Required Documentation
Now comes the exciting part of getting your paperwork in order to establish your business in Bulgaria. Let's dive into the key documents you'll need:
Articles of Association
The Articles of Association are the backbone of your company, as they outline the internal rules, business operations, decisions from the constituent assembly, and management structure. Specifically, you'll need to submit the following declarations:
Declaration | Requirement |
Manager's Eligibility (Article 141) | Confirms the manager's eligibility to hold the position |
Non-Competition (Article 142) | Ensures the manager is not in competition with the company |
Truth Declaration for Stated Circumstances | Attests to the truthfulness of the information provided |
Proof of Registered Address
When registering your business in Bulgaria, you have several options for your registered address:
Address Type | Best For |
Virtual Office | Remote operations |
Owned Property | Local businesses |
Rented Space | Physical presence |
Using a virtual office in the center of Sofia, near the European Commission building, can be a cost-effective solution, especially when combined with eBranch services. These services can handle your professional correspondence, including translation, to streamline your operations.
By preparing these key documents and understanding the address options, you'll be well on your way to establishing your business presence in the Bulgarian market. The process is straightforward, and modern solutions like eBranch can make it even easier to manage remotely.
Identification Documents
When registering your business in Bulgaria, you and your team will need to provide the following identification documents:
Document | Requirement |
For Managers/Founders: | |
Valid Passport or ID Card | Original document must be presented |
Notarized Signature Specimens | - |
Power of Attorney | If using representation |
An important note is that all partners and managers must visit Bulgaria in person for this initial step. However, with modern solutions like eBranch services, you won't need a local entity or PEO to handle the rest of the registration process.
The good news is that the Commercial Register processes these documents quickly. Preparing everything digitally when possible is recommended, as it is often faster and more cost-effective. Be sure to keep copies of all submitted documents for your records.
For the required bank statement, the minimum deposit for an OOD (Limited Liability Company) is just 2 BGN, which is less than the cost of a coffee. If setting up with multiple founders, the requirement is even lower at 1 BGN per person.
While this document list is tailored for an OOD, other business structures in Bulgaria may have slightly different requirements. It's always best to consult with local experts to ensure you have all the necessary paperwork in order.
Open A Bulgarian Bank Account
Setting up a bank account is one of the most exciting parts of your Bulgarian business journey. Thanks to recent changes in the Bulgarian banking system, this process has become quite straightforward.
Minimum Capital Requirements
Great news! Bulgaria has made starting a business super affordable. Since October 2009, the minimum capital requirement for an OOD (Limited Liability Company) has dropped to just 2 BGN (about €1)! While this is the legal minimum, it is advisable to consider a more substantial initial deposit, as it can help:
Appear more favorably to banks
Easier to obtain financing later if needed
Allow partners to provide additional funding through interest-bearing loans (current market rate: 3-4%)
Bank Account Opening Process
Here's what you need to know about getting your Bulgarian bank account up and running:
Document Type | Processing Time | Notes |
Basic Review | Up to 1 week | Standard processing |
Foreign Owner | 2-3 weeks | Extra verification needed |
Power of Attorney | +1 week | If using representation |
Required Documents:
Company registration certificate
Tax identification number
Proof of identity for all directors
Articles of association
Business plan (some banks require this)
Important Changes for 2024: Since March 2019, banks have introduced special conditions for companies with foreign owners. You now have more options:
Personal Visit: At least one company representative must visit the bank
Online Banking: Get access to English-language services
Multiple Currencies: Choose from EUR, USD, BGN, and more!
Your new Bulgarian bank account will come with great features, including SEPA participation for seamless European transfers, deposit insurance up to €100,000, and a fixed BGN-EUR exchange rate (no forex risk!).
Overall, the process of opening a Bulgarian bank account has become more accessible and flexible, making it easier than ever to establish your business presence in this dynamic market.
International Payment Capabilities
When opening a business bank account in Bulgaria, ensure that the chosen bank supports international payment capabilities. This feature is crucial for smooth financial operations, especially if the business engages in international trade or employs workers from abroad.
Key Benefits of Bulgarian Bank Accounts
Deposits Insured: All deposits are insured up to €100,000, adhering to European banking standards.
Remote Management: Modern solutions like eBranch services allow managing the account remotely without needing a local presence or PEO.
Debit Card Delivery: Debit cards can be delivered internationally for seamless operations.
Register With The Bulgarian Commercial Register
Step 1: Application Submission
The Commercial Register is essential for legitimizing a business in Bulgaria. The country has streamlined the process since 2007, offering both in-person and online submission options.
Required Documents:
Company registration documents
Bank deposit confirmation
Notarized signatures
Personal identification documents
Written records of general meetings
Electronic submissions are faster and more cost-effective. eBranch services further simplify this process by enabling remote handling.
Step 2: Registration Fees
The registration fees vary based on the business type and submission method. Here's a breakdown:
Business Type | Standard Fee | Online Fee |
OOD/EOOD | 110 BGN | 55 BGN |
AD | 360 BGN | 180 BGN |
ET | 30 BGN | 15 BGN |
Branch Office | 340 BGN | 170 BGN |
Additional Costs
Name Reservation: Costs 40 BGN (20 BGN for online submissions).
Benefits of Registration
Legitimacy: Registration with the Commercial Register establishes the legal identity of your business.
Operational Flexibility: With remote banking options, businesses can operate without needing local infrastructure.
Cost-Effective: Bulgaria offers one of the lowest setup costs in Europe, making it ideal for startups.
For businesses planning their operations, these steps ensure a smooth registration process while maintaining cost efficiency and compliance.
Processing Time And Timeline For Business Registration In Bulgaria
The process of registering a business in Bulgaria typically takes just 1-2 weeks to complete. Here are some key details about the timeline and effects of business registration:
Timeline Milestone | Effect |
Document Submission | Must be done within 7 days of document preparation for fastest processing |
Electronic Submission | Processes faster than in-person submissions |
15 Days After Publication | Registration becomes legally active |
After Publication | Everyone is presumed to know about your registered business (declaration effect) |
Registered Details | Considered true, even if there are minor errors (positive publicity) |
The user also highlighted that using a virtual office service in Bulgaria can help speed up the overall registration process, as they can handle tasks like mail management, document translation, and monitoring the progress of your application.
Additionally, it's important to keep your electronic signature handy, as you'll need it for future updates to your business registration. This electronic signature acts as a VIP pass to the Bulgarian business world.
By properly preparing the required documents ahead of time and leveraging modern solutions like virtual office services, you can ensure a smooth and efficient business registration process in Bulgaria.
Complete Post-Registration Steps
Alright, superstar! You've got your Bulgarian business registered - but hold onto your hat because we're about to make it fully operational. Let's dive into the final (and super important) steps that'll get you up and running.
Tax Registration
Once you have your Unified Identity Code (UIC), you should register for tax reasons with the National Revenue Agency (NRA).
VAT Registration Requirements:
Mandatory if your turnover hits 100,000 BGN (≈ €51,100)
Submit the VAT registration within 14 days after reaching the threshold
Optional VAT registration available for smaller businesses
An exciting fact is that you can register for VAT even before hitting the threshold - it's totally up to you! And with eBranch services, you can handle most of this remotely without the need for a local entity.
Here's a quick look at the key tax types and rates in Bulgaria:
Tax Type | Rate | Due Date |
Corporate Tax | 10% | March 31st |
VAT | 20% | 14th monthly |
Dividend Tax | 5% | Quarterly |
Social Security Registration
Protecting your team is crucial, and Bulgaria's social security system is like a safety net with style. Here's a breakdown of the contributions:
Employer Contributions:
18.92-19.62% of gross salary
Health insurance: 4.8%
Social security: 14.12-14.82%
Employee Contributions:
Total: 13.78%
Health insurance: 3.2%
Social security: 10.58%
Managers from other EU countries may be able to remain covered by their home country's insurance system if they qualify for an A1 certificate.
After you finish these post-registration stages, your Bulgarian firm will be ready to go and will meet all of the tax and social security requirements of the country.
Obtaining Necessary Licenses In Bulgaria
Different industries in Bulgaria require special licenses to operate, and the user has provided a helpful overview of the key sectors that need these permits:
Key Industries Requiring Special Licenses:
Financial operations (banks, insurance)
Medical services
Transport activities
Food and beverage
Construction
Tourism
Education
Gaming and gambling
The good news is that many of these licenses can be obtained through a virtual office setup, and the process is becoming more streamlined each year as Bulgaria continues to modernize its systems.
Important Deadlines to Remember:
Social security registration: Within 7 days of starting activities
VAT registration application: 14 days after reaching the 100,000 BGN turnover threshold
Annual tax returns: By March 31st
Monthly social security declarations: By the 25th of the following month
Most of these registrations can now be completed online, and with eBranch services, you won't need a local entity or PEO to handle these steps, making the process more efficient.
To ensure a smooth licensing process, the user recommends:
Keeping digital copies of all registrations
Setting up automatic payment reminders
Considering hiring a local accountant
Using online banking for seamless tax payments
Additionally, the user suggests setting up a Bulgarian bank account, keeping your electronic signature ready for declarations, and considering a virtual office service for mail handling. Staying updated on any threshold changes is also important.
Once these licensing and registration steps are complete, your business will be fully compliant and ready to thrive in the Bulgarian market. The ability to manage most of these processes remotely, thanks to modern solutions like eBranch services, is a significant advantage.
Conclusion
Bulgaria offers an accessible and streamlined path for businesses looking to expand into the European market. With a competitive 10% corporate tax rate, a minimal 2 BGN capital requirement, and a range of modern digital solutions, the process of registering and operating a company in Bulgaria has been transformed.
Through the utilization of virtual office services and eBranch platforms, global companies can effectively manage the registration process, tax compliance, and day-to-day operations from a distance, without requiring a local entity or PEO. This adaptability, paired with Bulgaria's advantageous position within the EU and its business-friendly regulations, positions it as an appealing choice for international businesses aiming to set up operations in Europe. With accessible guidance and useful resources at hand, the Bulgarian market offers a promising prospect for companies seeking to expand their global presence.
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