Entrepreneurs interested in the types of Bulgarian companies can choose one of the five major forms the South-Eastern European country regulates for commercial corporations:
- limited liability company (LLC),
- joint stock company (JSC),
- limited partnership,
- general partnership,
- partnership limited by shares.
The most common organizations are the limited liability companies and the joint stock ones.
Both types have differences, as well as common characteristics. The LLC and the JSC companies can be owned or established by one or more persons or legal entities. The number of the shareholders must be at least one.
These two types of Bulgarian companies require different share capital. A limited liability company requires a capital of at least 2 BGN (1 EUR). The joint stock business entity must have at least BGN 50,000 share capital, with a minimum nominal value of 1 BGN per share.
There is a difference regarding the companies bodies. A limited liability company has a general meeting of stakeholders and at least one manager. In case of a joint stock company, besides the general meeting of shareholders, there is also a board of directors (with a minimum of three persons), along with a supervisory board and a management board, both with at least three members.
A LLC founder must contribute his interest, under the rule of being expelled from the association for not doing so. All partners have equal rights concerning the management, the profit and the company’s affairs and the liquidation procedures.
The shareholders of a joint stock company have a liability limited by their contribution. The capital stock can be increased by issuing new shares, but it can also be lowered or cancelled. Once a shareholder subscribes for shares, it is mandatory to contribute for them, otherwise he owes interest.
While an independent audit is not needed for a LLC regarding the annual accounts (with some exceptions), this one is mandatory for a JSC.
Bulgarian limited partnership represents an entity set up by one or more partners, but with two certain categories: general partners liable for the business liabilities and limited partners who invest money. The latter ones receive benefits (capital gains, income and tax benefits) similar to dividends. The fees and a percentage of the income are collected by the general partner.
A Bulgarian general partnership is formed by minimum two persons, under a joint trade name, to develop commercial transactions by occupation. It doesn’t require a minimum capital share and the partners share unlimited liability regardless their investments in the partnership. All the partners participate equally in the business administration and profit share.
Bulgarian partnership limited by shares represents a mixture between a joint stock company and a limited partnership. The business form must have at least three limited partners chosen by the general partners from subscribers. Their liability is influenced by the share contribution.
If you need more details about how you can set up a company in Bulgaria, you may contact our agents in company formation who will help you open a company in this country. We may also help you with information if you are interested in opening a business in Portugal, Austria or Liechtenstein, through our local partners.
We invite you to watch a video about the types of companies available for incorporation in Bulgaria: