EOOD Registration - Why You Should Not Do It

When we think about starting a new company in Bulgaria, the first options that usually come to mind are the registration of EOOD (sole-owned limited liability company) or OOD (limited liability company). This legal form has existed in Bulgarian legislation since 1993 and until recently was considered the most flexible and preferred type of commercial company. However, this changed in 2023, when an amendment to the Bulgarian Commercial Act introduced the Variable Capital Company (VCC). Why you might choose to register a VCC instead of an OOD is explained in this article.

EOOD Registration

A sole-owned limited liability company (EOOD) is established by one owner – either a natural person or a legal entity. The sole owner may be a Bulgarian or foreign individual, as well as a Bulgarian or foreign company. Before registering an EOOD, you must choose a unique company name. It must be written in Bulgarian, but optionally it may also be written in a foreign language. Your new EOOD must have a registered seat and management address in Bulgaria. The company may be registered with either a physical or a virtual business address.

Mandatory Capital Raising Bank Account for EOOD Registration

As part of the company registration process, the company capital must be deposited into a special capital raising bank account. In many cases, banks require the physical presence of the manager and/or the owner at the bank office. The fees for opening such account are not insignificant and may reach several hundred euros. A major obstacle for those wishing to register an EOOD in Bulgaria is precisely the opening of this capital raising bank account, as banks often refuse to open one. This significantly delays or even blocks the registration process.

If the bank approves your application and the capital raising bank account is opened, the next step is notarization of the manager’s specimen signature. Please note that a limited liability company may only be represented by one or more managers. After notarizing the specimen signature, you may proceed with filing the registration documents with the Commercial register.

How Much Does EOOD Registration Cost?

If a foreign company wishes to become the sole owner of a Bulgarian EOOD, it must obtain a document certifying its current legal status in its country of registration. In Germany, for example, the price of such a document starts at EUR 100,00. The state fee for reserving the name is EUR 10,22 for an online application, or EUR 20,45 for a paper-based application. The cost of a business address service in Bulgaria starts from EUR 300,00 per year. Opening a capital raising bank account for EOOD or OOD is also a paid service, with bank fees typically ranging from EUR 150,00 to EUR 460,00 for foreigners. Some banks also charge maintenance and closure fees, starting from EUR 15,00. Another cost to consider during EOOD registration and subsequent company management is notary fees for document certification. The standard notary fee starts from EUR 3,00. The state fee for online registration of EOOD or OOD is EUR 28,12.

Timeframe for EOOD Registration

Anyone planning to register EOOD or OOD should factor in the time required for submission, review, and approval of documents by the bank for opening the capital raising bank account. This usually takes between 7 and 14 business days. The statutory review period for registration documents is 1 business day, and 3 business days are allowed for correcting any irregularities.

Variable Capital Company (VCC) Registration

The newest type of commercial company in Bulgaria is the Variable Capital Company (VCC). It represents a highly beneficial legislative innovation, designed primarily to serve the interests of entrepreneurs and investors, as well as to regulate employer – employee relations through the conclusion of vesting agreements.

Like an OOD, a VCC may be established by one or more Bulgarian or foreign individuals, as well as by one or more Bulgarian or foreign companies. The VCC must have a unique company name and may be registered at either a physical or virtual address in Bulgaria. Up to this point, the similarities between OOD and VCC end.

Company Registration Without a Capital Raising Bank Account

For the establishment of a VCC or a sole-owned VCC, no capital raising bank account is required. The amount of capital is not registered in the Commercial Register but only recorded in the shareholders book. Physical presence of the founder(s) in Bulgaria is not mandatory. The only document that must be notarized by the manager or members of the board of directors is the specimen signature. This can be done either in Bulgaria or at any Bulgarian diplomatic mission abroad (full list of diplomatic missions find here). Unlike an OOD, a VCC may be managed either by one or more managers or by board of directors.

All documents required for the VCC registration may be prepared, signed, and submitted online, with the sole exception of the specimen signature. Once the documents are filed and approved, the VCC is officially registered. After registration, you may register in our platform, which provides full online company management.

How Much Does VCC Registration Cost?

If a foreign company wishes to become the sole owner of a Bulgarian VCC, it must obtain a certificate of good standing from its country of registration. In Germany, the cost of such a document starts from EUR 100,00. The state fee for reserving a company name is EUR 10,22 for an online application, or EUR 20,45 for a paper-based application. The cost of a business address service in Bulgaria starts from EUR 300,00 per year. There are no fees for opening, maintaining, or closing a capital raising bank account for VCC or sole-owned VCC, as such an account is not required. The only notary-related expense is a one-time fee for notarizing the specimen signature, starting from EUR 3,00. The state fee for online registration of a VCC or sole-owned VCC is EUR 28,12.

Timeframe for VCC Registration

The statutory review period for registration documents of a VCC or sole-owned is 1 business day, with 3 business days allowed for correcting any deficiencies.

Company Registration – Required Time and Costs