The increasing interest has been caused by certain facts, some of which are:

• The lowest tax for companies (corporate tax) in the European Union – 10 %;
• Relatively favorable value added tax – 20% (9% in Tourism), with the existence of provisions for non-accrual of VAT for arrivals to the company from another member state, registered under VAT;
• Option for the Bulgarian company to develop international business relations by paying taxes only in Bulgaria;
• Accessible legal and accountancy services for Bulgarian companies, etc.

A Bulgarian commercial company can be registered under the Commercial Act of the Republic of Bulgaria. After the specific factual elements have been completed, the company is registered by the public official in the Bulgarian Commercial Register with the Registry Agency, which is publically accessible.
 

Some of the most frequently used forms of Bulgarian companies are the limited liability company and the joint stock company, whereas both forms are flexible enough and have their own advantages.
 

In this publication we shall dedicate our attention only to the Bulgarian limited liability company as one of the most frequently used Bulgarian companies in practice. The Commercial Law settles this type of companies in article 113 and the following ones, and for the incorporation of a single limited liability company, it shall comply with the following regulations:
 

• To have at least a single partner/ shareholder of the equity – natural person or company, whereas a company with a single partner/shareholder of equity shall be designated with the abbreviation EOOD following its name, and companies with more than a single partner/shareholder shall be marked with OOD;
• To have a manager appointed at least a single natural person, most frequently one of the partners or several of the partners are appointed as managers;
• To have statute or articles of incorporation with a legally established contents and form. The contents of the statute/articles of incorporation, the full name (company name) of the company shall be included, as well as the seat and registered office, the amount of shares, information regarding the shares and the manager, respectively the method of representation;
• To have deposited the legally established Bulgarian company equity (at least 2 BGN/ 1 EURO);
• To have provided the respective declarations, certifying the true and correct circumstances, lack of specific legal facts, etc.

The preparation of the Bulgarian company documents and the initiation of the registration procedures of the new registered Bulgarian company could be performed personally by the shareholder, by a third party with express power of attorney, certified by a Notary Public or by a lawyer. In any case, using the services of a person with legal education and experience in the Bulgarian Commercial Law is recommended.
 

After the expiry of a three days term of the declaration to the Commercial Register for incorporation of the company, the official shall make a decision by registering the company, shall provide instructions for removal of irregularities, or shall make a justified rejection. A reasonable term regarding the registration of the Bulgarian limited liability company is considered to be 5 work days from the time of presentation of the required documents.
 

After incorporation of the Bulgarian company and its registration in the Commercial Register, it shall receive a uniform identification code (EIK) and shall perform commercial operations. Consequently, the company shall voluntarily register under V.A.T., and for the V.A.T. registration, a separate procedure shall be initiated.
 

After its accrual, the company shall dispose of bank accounts, shall purchase real estates and any other assets, and shall substitute in legal relations any other legal entities, etc. The subject matter of activity of the company could be anything, as long as it is not contradictory to the Law.
 

Certain activities exist, which the Bulgarian companies could not perform without obtaining a license issued by the respective executive body. Some of the activities subject to licensing regime are insurance and transport activities, tour operator and tourism activity, bank activity and gambling, energy, medicine, etc.
 

Bulgarian company taxation is performed according to the Bulgarian Corporate Income Tax Act and shall amount to 10 percent of the company profits, and in case of distribution of dividends, it shall be 5 percent.
 

The fees for registration of a Bulgarian company may vary, depending on the qualification of the contractor, the number of shareholders, the number of managers or foreign natural persons or company, etc. An average charge for the registration of Bulgarian company starting from 150 Euro.
 

Lawyer`s Office Tomovski