Foreign commercial companies may carry out economic activity in Bulgaria through the registration of a branch or through the establishment of a subsidiary (most often an EOOD). The registration of a branch is the preferred option, since upon the cessation of its activity there is no need to carry out a liquidation procedure. The branch is treated as a place of business in Bulgaria and is a taxable person under Bulgarian legislation. It receives its own Unified Identification Code (ЕИК), may be registered for VAT and may carry out commercial activity.
Number of branches
A foreign commercial company may register an unlimited number of branches in Bulgaria. Nevertheless, in a single locality only one branch may be opened, with the exception of banks and insurance companies, which are entitled to register more than one branch in the same locality.
Legal status of the branch
The branch is not an independent legal entity, but constitutes part of the commercial enterprise of the foreign company. All contracts concluded with the branch are deemed to have been concluded with the company that established it. The branch, however, has a certain degree of autonomy. It keeps separate commercial books and draws up its own balance sheet. Likewise, disputes arising under contracts concluded by the branch may be heard by the court either at the seat of the branch or at the seat of the parent company.
The name of the branch must include the trade name of the foreign trader with the addition "branch".
Scope of activity and representation
The branch may have a scope of activity different from that of the parent company. Upon the establishment of the branch, the scope of the power of representation of its manager is determined. The manager may be authorised with full rights or may have limited powers, such as, for example, being a commercial representative or a procurator. The powers of the manager must be set out in a notarised power of attorney.
Procedure for registration of a branch in the Commercial Register
Required documents:
- An application in the А8 form.
- A certificate of current status of the foreign legal entity or another document proving its existence, its right to carry out commercial activity, the names of the persons who represent it and the manner of representation.
- Notarised consent and a specimen signature of the manager of the branch.
- A decision of the competent body of the foreign company to open the branch.
- A licence or permit for the activity, if required due to the nature of the branch's activity.
- The instrument of incorporation, articles of association or statutes of the foreign company, together with all current amendments.
- A transcript of the instrument of incorporation or the statutes with personal data redacted.
- A notarised power of attorney for the manager of the branch.
- A declaration of the truthfulness of the declared circumstances.
- A power of attorney for the submission of the documents.
- A payment order for the state fee paid.
If the scope of activity of the branch requires specific qualifications or a permit, the relevant documents, such as diplomas, certificates and others, must be attached. All documents in a foreign language must be translated and legalised in Bulgaria.
State fees
The state fee for the registration of a branch is BGN 170 if the application is submitted electronically by an attorney. In this case, the attorney's power of attorney does not require notarial certification. If the documents are submitted by another authorised representative, the power of attorney and the А8 Application must be notarised.
In the event that you need legal advice or assistance in connection with the registration of a branch of Bulgarian and foreign commercial companies, contact us on telephone 0887550706 or by e-mail: [email protected]
