According to the Bulgarian Constitution, foreign nationals and foreign legal entities may not directly acquire land ownership rights and will not be able to do so until 2014. However, foreigners are permitted to acquire the ownership of buildings and premises within buildings, as well as some limited property rights. These restrictions, however, do not apply to Bulgarian companies, irrespective of the percentage of foreign participation in such companies. Thus, foreign persons can acquire full land ownership rights by setting up or joining a company incorporated under the Bulgarian legislation (this is inclusive of agricultural land).
The most popular and preferred legal form by both locals and foreigners for carrying out business in Bulgaria is the limited liability company (OOD) as it restricts the liability of the shareholders to the amount of the share in the capital of the company. All companies in Bulgaria have to be registered with the Registry Agency, which is a process that usually takes 1 or 2 weeks. The shares in an OOD are attributed to individuals and can only be transferred with an additional entering in the Commercial Register of the Registry Agency.
This is not as daunting as it might sound and can all be done on the first visit if required. Note that one company can own a number of properties. Please allow one working day for these legal proceedings. The lawyer who we deal with will handle the whole process for you, from choosing the company name to registering the company with the Registry Agency. All this has to be done within strict deadlines and carry hefty fines if they are not adhered to! If the property will be bought by more than one person, the presence of all people involved is required. Each buyer needs to present his/her valid passport. Some of the documents need to be signed in front of a local Notary Public. The setting up of a new company also requires opening a company bank account (small fee applies) with the deposit of the minimum required company capital for a Limited Liability Company of BGN 2 (about EUR 1), which can be withdrawn once the company has been formed. This money remains yours and is only needed to open the account. It can be withdrawn after company is formed (about 21 days). Many clients use it to defray final balance payment on their Bulgarian property purchase. Please note that you will be responsible for submission of company records annually.
The legal fees are quoted as a total for the Registry Agency fees and the lawyer’s fee for handling you. So in total it will cost you EUR 695.00 for the lawyer who we deal with to complete the whole process on your behalf. For this purpose we will need a power of attorney to act on buyer’s behalf.
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