Establishing business in Bulgaria

Forms of business structures in Bulgaria

The current Bulgarian legislation provides different scenarios for establishing a business presence in Bulgaria. The legal forms available are as follows:

  • General Partnership;
  • Limited Partnership;
  • (solely owned) Limited Liability Company;
  • (solely owned) Joint-stock Company;
  • Partnership Limited by Shares;
  • Branch;
  • Trade Representative Office.

Except for the branch and trade representative office, all other legal forms are deemed Bulgarian legal entities.

A registration with the Trade Register and the Register of Non-Profit Legal Entities is required for a person or other legal entity to start a company in Bulgaria.

The two types of Bulgarian companies most commonly used by foreign investors are: (i) Limited Liability Company and (ii) Joint-Stock Company. These companies have registered capital divided by shares and the liability of the shareholders is limited to the contribution to the share capital.

Limited Liability Company in Bulgaria

  • Foundation – The limited liability company is formed by one or more legal entities or individuals;
  • Shareholders – There is no restriction on foreign participation. The number of the shareholders is unlimited;
  • Minimum share capital – The minimum share capital of a limited liability company is BGN 2 (two);
  • Statutory bodies – The General Meeting of the shareholders is the supreme governing body. The company is represented and managed by one or more director(s). The director(s) may be foreign nationals.

Joint Stock Company in Bulgaria

  • Foundation – Joint-stock companies may be founded by one or more individuals or legal persons;
  • Shareholders – There is no restriction on foreign participation. The number of the shareholders is unlimited;
  • Minimum share capital – Joint-stock company capital must be at least BGN 50,000 (fifty thousand). The share capital must be fully subscribed and 25 per cent of the par value of each share must be paid up prior to the incorporation;
  • Types of shares – The shares are Preference shares may also be issued. Preference shares may guarantee additional dividend or share in the company’s assets in cases of liquidation;
  • Bonds – Joint-stock companies may issue bonds two years after their incorporation;
  • Statutory Bodies – General Meeting of the Shareholders is the supreme governing body. Bulgarian joint stock companies may choose between a one-tier system of management (i.e. Board of Directors) and a two-tier system (i.e. Managing Board and Supervisory Board).

One-tier System

Under the one tier system, companies are managed and represented by a Board of Directors, which consists of at least 3 but no more than 9 persons.

The Board of Directors elects one or more of its members to be executive director(s), i.e. members having signatory rights. The number of executive directors must not be more than the remaining members of the Board.

For example:

3-member Board of Directors: max. 1 executive director (1<2)
5-member Board of Directors: max. 2 executive directors (2<3)

Two-tier System

Under the two-tier system, the company is managed by a Managing Board under the supervision of a Supervisory Board. The members of the Managing Board are elected and dismissed by the Supervisory Board. Their number is determined by the Articles of Association but cannot exceed 9 persons. The Managing Board is required to report its activities to the Supervisory Board.

The Supervisory Board cannot take part in the management of the company per se. It represents the company in its relations with the Managing Board. The Supervisory Board is elected by the General Meeting of the Shareholders (the sole shareholder) and consists of 3 to 7 persons.

The same person may not be elected as a member of both the Supervisory and the Managing Boards.

The Management Board with the consent of the Supervisory Board shall elect one or more of its members to be executive directors i.e. they will have signatory rights.





Delchev & Partners is a prime, full service, commercial law firm with offices in Sofia and Plovdiv, Bulgaria. Our experienced team of lawyers  and consultants provide quality legal and tax services in various practice areas to multinational corporations and companies, closely held foreign and local businesses, local entrepreneurs, exempt organizations and individuals, based or operating in any major Bulgarian city – Sofia, Plovdiv, Varna, Burgas, Stara Zagora etc.