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The two most commonly used legal forms for conducting business in Bulgaria are the Joint Stock Company (AD) and the Limited Liability Company (OOD). Bulgarian legislation also provides for other forms of business presence, including joint ventures, branches, holdings, cooperatives, and representative offices.

All legal entities must be registered with the Bulgarian Commercial Register, a procedure that typically takes approximately one week, provided that all documentation is complete and properly prepared.

Both the AD and the OOD limit the liability of shareholders to the amount of their capital contribution, which is why they are the preferred structures for both local and foreign investors. The minimum share capital for an OOD is EUR 1.

In an OOD, shares are attributed to specific shareholders and any transfer of shares must be registered with the Commercial Register. In contrast, the shares of an AD are not individually attributed and may be transferred without registration, offering greater flexibility.

A Joint Stock Company (AD) may issue registered shares, bearer shares, and preference shares, in both paper-based and book-entry form. This structure allows for a higher level of shareholder anonymity and enables the company to raise capital through the issuance of shares or bonds, including via the stock exchange.

An AD is governed by the General Meeting of Shareholders and managed either by a Board of Directors or by a Supervisory Board and Management Board, depending on the chosen management system.

As a general rule, the annual financial statements of an OOD are not subject to statutory audit unless specific thresholds under the Bulgarian Accountancy Act are met. In contrast, all Joint Stock Companies (ADs) are required to have their annual financial statements audited by a Certified Public Accountant.

Both legal forms may also be established by a single individual. In such cases, a one-person limited liability company is registered as an EOOD, while a one-person joint stock company is registered as an EAD.
EOODs and EADs are considered Bulgarian legal entities, even when their sole shareholder is a foreign individual or legal entity.

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The incorporation process generally includes the following steps:

• Verification of company name availability
• Preparation of the Articles of Association
• Deposit of the required share capital:
  • at least 70% for an OOD (total capital: EUR 1), or
  • at least 25% for an AD (total capital: EUR 25,000)
• Submission of the incorporation application and proof of capital deposit to the Commercial Register
• Registration with the tax authorities (VAT registration, where applicable, within 14 days)
• Opening of a corporate bank account
• Company stamp (where required)

How We Can Assist

Legatio Consult provides comprehensive legal and accounting support for company formation and structuring in Bulgaria. We advise Bulgarian and international clients throughout the entire incorporation process, ensuring a smooth, compliant and efficient establishment of their business presence.