Options for registering companies in Bulgaria
As an EU member state, Bulgaria is highly attractive to foreign investors due to its 10% flat corporate tax rate, which is one of the lowest in the European Union and its flat 10% personal income tax rate. Its strategic location offers competitive access to both European and Turkish markets.
The key corporate structures available to foreign investors are governed by the Bulgarian Commercial Law.
Bulgaria offers international companies the following legal structures for establishing a local presence:
Private limited company (Дружество с ограничена отговорност - ООД)
- Bulgarian OOD is the most popular and flexible structure for small and medium-sized enterprises.
- It offers limited liability to shareholders, typically up to the amount of their capital contribution.
- It requires a symbolic minimum share capital of €1, making it highly accessible.
- Registration requires a notarised consent and specimen signature of the manager and filing with the Trade Register.
Branch office of a foreign company (Клон)
- The Bulgarian branch is not a separate legal entity. It operates as a Permanent Establishment (PE) and extension of the foreign parent company.
- It is allowed to conduct commercial activities and generate revenue in Bulgaria.
- A branch is subject to Bulgarian corporate income tax on profits derived from its activities in the country.
- The parent company retains full liabilty for the branch's obligations.
Representative office (Търговско представителство - ТП)
- The Bulgarian rep. office is strictly limited to non-commercial activities such as market research, promotion and publicity.
- It is prohibited from engaging in any commercial transactions or generating revenue in Bulgaria.
- The TRO is not considered a separate legal entity and does not pay corporate profit tax, though it is still required to register with the Bulgarian Chamber of Commerce and Industry (BCCI).
- All expenses must be covered by the foreign parent company.
Free zone company (Свободна зона)
- Companies operating within the designated Bulgarian free zones (or special economic zones) are designed to promote export and investment.
- While FZ companies are not fully tax-exempt, they can benefit from incentives like VAT zero-rating on goods imported into the zone and subsequently exported outside the EU.
- The key advantage is the streamlined customs and administrative procedures for goods handling, rather than an exemption from the standard 10% corporate tax.
To help you choose the right structure, we have created an ‘at a glance’ summary table for the common company types that outlines key differences in formation processes, requirements, and timelines. It serves as a valuable resource for foreign companies looking to setup or expand a business in Bulgaria.
Comparison of the common types of companies in Bulgaria
Information verified against Bulgarian Ministry of Economy and Industry