Buying Property in Bulgaria:
According to the Bulgarian Act on Foreign Investment, foreigners can buy buildings but not land. Therefore the most common method for foreigners is to set up a company which then owns the land.
Essentially the process is as below:
- Find a property and determine whether it is being sold with or without land. If it is being sold with land you need to form a company as the land owner (much the same as a "LTD" company in the UK, or Inc. in USA)
- Negotiate and agree the final price with the current owners.
- After the verbal agreement, draw up the initial contract and get the property removed from the market. (Similar to "Sold subject to contract" in the UK, or “Residential Purchase Agreement” in USA)
- Do the standard checks on:
- Title documents
- Licenses and permissions
- Debts on title
- Terms of contract
- Sign the Notary Act (Contract to Purchase) in front of a Bulgarian Notary Public and the Final Legal Contract
- You are the proud owner of a Bulgarian property!
Brief information on forming a company (if you need to):
Private Limited Company (a limited liability company) - "OOD" - it is a commercial company with share capital owned by its members whose liability is limited to the amount of the capital subscribed.
A private limited liability company may be founded by one or more persons, including foreign natural or legal persons.
Contributions to the foundation capital may be paid in cash or in kind. The statutory bodies of the private limited companies are the general meeting of shareholders, which must be held at least once a year, and the managing director or board of directors.
Formation and registration of a company
A company is considered incorporated as from the date of its registration into the commercial register of the relevant district court. The application for registration furnished with certain documents required by the law shall be filed with the court by the elected managing body.
Private Limited Company - in order to be registered in a commercial register, a private limited company must:
produce its articles of association (Memorandum of Association - in the case of a single-person private limited company); the Law on Commerce stipulates the obligatory provisions of the articles;
- have appointed a managing director (or board of directors);
- have paid up at least 70% of its authorised capital, including at least one-third of each member's contribution.
- This information together with details of the management, etc., is recorded in the commercial register and promulgated in the State Newspapers.
Don't worry! It's not as bad as it seems and we at UNLIMITED Real Estate can help you at each step of the way.