The process of transferring company shares in an OOD depends on whether the shares are to be transferred to another partner in the company or to a person outside it.
Where a partner transfers his shares to another partner, no approval from the general meeting of the company is required. However, if the shares are transferred to a third party, the requirements for the admission of a new partner must be met, which includes the consent of the general meeting both to the transfer and to the admission of the new member.
Recommendation for prior legal and accounting advice
Before transferring shares in an OOD, it is advisable to obtain legal and accounting advice. Using ready-made documents from the internet in order to avoid the cost of consultation often leads to errors that can create additional problems and costs for the seller and the buyer. It is also important to determine the price of the transfer of the shares, which usually corresponds to the value of the shares in the capital. Failure to comply with tax requirements, such as in transactions between related parties, may lead to penalties.
Required documents
In order to effect the entry in the Commercial Register of the transfer of shares, the following documents must be submitted:
- Standard-form application А4
- Minutes of the general meeting of the partners
- An application for the admission of a new partner
- Invitations to the partners
- A share transfer agreement with notarial certification of the signatures and the content
- The Articles of Association, with personal data redacted as required by law
- Declarations under Article 129(2) of the Commerce Act as to the absence of unpaid liabilities to employees
- Declarations under Article 13(4) and (5) of the Commercial Register and Register of Non-Profit Legal Entities Act (where filed through an authorised representative)
- A payment order for the paid state fee
- A power of attorney, if the documents are filed by an authorised representative.
If all the shares are transferred to a single person and the company becomes an EOOD, minutes of the sole owner are also required. Where the seller or buyer of the shares is a company, a resolution of its competent body to carry out the transfer is also necessary.
When transferring shares, it is possible also to file documents for other changes in the company – for example, a change of the company name, the registered office address, the scope of activity or the manager. In that case, a notarised specimen of the new manager's signature and additional declarations under the Commerce Act must be provided.
If the Articles of Association include special clauses on the transfer of shares, those requirements must be complied with. It is possible that some documents, such as the minutes on the admission of a new partner, may be required with notarial certification.
Filing the documents with the Commercial Register
The documents for the transfer of shares in an OOD may be filed on paper at any office of the Registry Agency. They cannot be sent by post or courier, since verification of the identity of the person filing them is required.
The documents may also be filed electronically using an electronic signature, in which case a 50% discount on the state fee applies. Application А4 and its accompanying documents may be filed by the company's manager. If there is more than one manager with the power of sole representation, the application may be filed by just one of them. Where the managers represent the company jointly, all of them must file and sign the application.
A lawyer holding a written power of attorney may also file the documents with the register. In this case, no notarial certification of the power of attorney and the application is required, and a 50% discount on the fee applies for electronic filing.
An ordinary authorised representative may also file the documents, provided he holds a notarised power of attorney and a signed declaration under Article 13(5) of the Commercial Register and Register of Non-Profit Legal Entities Act. In this case, Application А4 must also be notarised.
Time limit and particularities of the entry
A partner who has transferred all his shares is not entitled to file the transfer documents himself. If the manager fails to register the transfer for years, this may lead to situations in which the partner who has transferred his shares continues to be regarded as a partner in the company vis-à-vis third parties and the tax authorities. To avoid these risks, it is advisable to consult a lawyer when terminating participation in an OOD.
The entry of the transfer of shares is made within four working days.
State fees
The state fee for entering the transfer of shares in the Commercial Register is BGN 30 for filing on paper. For electronic filing, the fee is BGN 15.
In the event that you need further information, assistance or advice in connection with the transfer of company shares in an OOD or EOOD, contact us on telephone 0887550706 or by e-mail: [email protected]
