More and more often we receive questions related to opening a company by a foreigner. In the next article we will try to give an answer and explain the procedure for registering a company by a foreign citizen in Bulgaria. Here you will learn which foreigners can register companies in Bulgaria, whether the respective foreigner must live in the country, how much it costs to register the company and others.
When it comes to opening a company by a foreigner in Bulgaria or transferring the management of an existing one in our country, the presence of certain specifics must be taken into account. As the person is not a citizen of the Republic of Bulgaria, slightly different and additional provisions and legal requirements apply to him. Before we talk about them, let’s first focus on the reasons why a foreigner would register a company in Bulgaria.
The pros of opening a company by a foreigner can be divided into two groups – social and economic.
Most foreigners who are not citizens of the European Union register companies in the country for the purpose of residing in the territory. For example, a foreigner from the Middle East can undertake remote company registration and, in compliance with legal requirements and rules, quite legally start living and doing business in Bulgaria.
Here we mean the low taxes in our country compared to Western EU members. This is the reason why many companies are reorienting their management in our country, as it is very cheap for them. Accounting services can also be negotiated at very good prices in a Bulgarian accounting firm. Another economic factor in opening a company by a foreigner is the extremely low salaries, compared to European ones. That is why it is extremely profitable for the big European producers to redirect their production to Bulgaria.
Which foreigners can register companies in Bulgaria?
All foreign citizens have the right to register their company in Bulgaria. There is no restriction on whether or not the foreigner concerned is a citizen of an EU Member State. We want to mention here that the person does not need to reside in Bulgaria to open a company here. It is also not necessary to understand or speak Bulgarian. In this case, we recommend that the documents be bilingual.
The first step in opening a company by a foreigner, as well as in any registration of a company is to open the so-called accumulation account. You can read more HERE.
Here is the time to note something very important. Recent amendments to the Anti-Money Laundering Measures have complicated the process of opening fundraising accounts. Following these changes, opening a fundraising account for foreign companies has become difficult, and for third-country nationals (non-EU nationals) it has become almost impossible.
What is the procedure?
The procedure for opening a company by a foreigner is in fact no different from that of Bulgarian citizens. Here, too, the minimum capital for registration of Ltd. / Ltd. is BGN 2, the documents submitted to the Commercial Register are also identical. State fees are unchanged. The partners are not responsible for the obligations of the company with their personal property.
Specifics (*this is not all the specifics)
- When opening a company by a foreigner, it is important that he / she is aware of the content of the documents he / she signs. There are 2 possibilities:
- Registration documents must be translated into the foreigner’s mother tongue or another language he understands. In this case, a bilingual version of the documents is prepared. The translation may not be made by a sworn translator, but then the person who did it should indicate his names, certify the accuracy of the translation and sign it.
- When opening a company by a foreigner, there is the following possibility. The documents may not be translated, but in this case a person who knows the relevant language must declare that he has translated the contents of the documents into a language understood by the foreigner and sign. The foreigner, for his part, must also declare that he understands the meaning of the documents and sign. These actions are performed before a notary.
- Of course, if the foreigner speaks and speaks Bulgarian, the need for translation is eliminated.
- Another specificity is that the name of the foreigner should be written in Cyrillic.
Is it possible to open a company by a foreigner remotely?
The answer is yes! Foreign citizens can register companies in Bulgaria without being physically present in the country. To open a company by a foreigner, the foreign citizen must notarize the documents in the country where he resides. The role of a notary abroad for Bulgarian documents is performed by the Bulgarian embassies and consulates.
The other option is a local notary. This complicates and makes the process much more expensive. The local notary can certify the documents only if they are in his own language, after which they have to go through translation into Bulgarian and legalization, which also considerably prolongs the process.
The two documents that must be certified in case you will remotely open a company by a foreigner are again the sample signed by the manager, but also a power of attorney to open a fundraising account of the company and deposit capital on behalf of the partners.
We at T&G Consulting are ready to assist you and advise you on issues related to starting a company by a foreigner in Bulgaria.