The joint-stock company (JSC) is a type of a company whose capital is divided into shares. A JSC may be formed by one or more Bulgarian and/or foreign physical or legal persons. The total amount of shares in a JSC forms its capital. The shareholders are responsible for the obligations of the JSC to the sum of the contributions made without being liable with their own personal properties.The trade name of a joint-stock company includes the words “Joint-Stock Company” or the abbreviation “JSC” (in Bulgarian – ”AD”/Cyrillic – ”АД”). The Statute of a JSC shall contain the requisites specified in the provisions of Article 165 of the Commercial Law.
The minimum amount of capital required for establishment of a JSC is 50 000 BGN (about 25 8000 EUR). However, the minimum required for banking or insurance activity, voluntary health insurance or other special activity is determined by other law.
The Bulgarian law allows two alternatives for management and representation of a joint-stock company – shareholders can choose between a one-tier and a two-tier management system. Foreigners can be appointed as managers of the company without any restrictions. The corporate governance structure of a joint-stock company consists of: a General Assembly of shareholders and a Board of Directors (in the case of a one-tier management system), or a Supervisory Board and a Management Board (in the case of a two-tier management system).
Entry of the JSC is stated by the members of the Board of Directors (in the case of a one- tier management system) or by the Management Board (in the case of a two-tier management system), or is empowered by the Statute or an authorized member of the management bodies of the JSC, as well as by a lawyer with an explicit written power of attorney. For commercial companies, the time required for entry or deletion in the Commercial Register is the end of the first working day following filing the required documents. On requests for registration of new circumstances, the registrars are obliged to act immediately.
Rights and obligations of the stockholders
The rights and obligations of the stockholders derive from the respective stock. According to Article 181 (3), sentence 2, all stockholders of the same stock class must be treated equally. On the contrary, the stockholders of different classes may be entitled to different rights. The single stock and the rights that derive from it – hereof, rights and obligations are transferred simultaneously. Exceptionally, it is possible to transfer specific rights under legally defined conditions. According to Article 185 (3) of the Commercial Act, voting rights may be transferred for a certain time period, if the stock has been transferred, as well. The rights of the stockholders may not be infringed, unless the respective stockholders had givrn their consent when subscribing the shares. The right of dividend is an irresolvable right of the stockholders. Also, a division into material and immaterial rights and obligations is possible. Moreover, the stockholders enjoy different individual and collective rights.
How to set up a Joint-Stock Company in Bulgaria
Legal framework – The Commerce Act; the Commercial Register Act and the competent authority is the Bulgarian Commercial Register with the Registry Agency.
The nessesery legal steps of the entire procedure of registration of Joint Stock company (plc – public company) is following :
1) Checking up with the electronic register of the Commercial Register and/or reservation of a business name.
2) Holding of an Incorporation Meeting, subscription of shares by the founders, adoption of Articles of Association or an Act of Incorporation, election of a Supervisory and Managing Boards, respectively of a Board of Directors.
3) Depositing the company capital into a special capital raising account (the minimum capital amount is 50 000 BGN- 27 000 EUR).
4) In case of any specific business, an authorisation or license by the competent authority shall be provided when filing the documents with the Commercial Register.
The documents, which are required and we prepare in full as a set registration are following :
– Preparation & drafting of application for registration.
– Preparation & drafting of Minutes of the shareholders’ Meeting of Incorporation.
– Preparation & drafting of attendance list of the incorporation meeting.
– Preparation & drafting of list of the subscribers of shares at the incorporation meeting.
– Preparation & drafting of declaration pursuant to Article 160, paragraph 2 of the Commerce Act.
– Preparation & drafting of specimen (signature) of an every executive director.
– Preparation & drafting of declaration under Article 234, paragraph 2 and paragraph 3 of the Commerce Act. – Declaration under Article 237 of the Commerce Act.
– Preparation & drafting of Minutes from the meeting of the Board of Directors.
– Preparation of application for applying of certificate of the deposited capital issued by a bank.
– Preparation & drafting of resolution of the managing body representing a shareholder who is a legal entity.
– Preparation & drafting of Certificate of good Statement of the relevant business register regarding a shareholder who is a foreign legal entity.
– Preparation & drafting of legal document evidencing payment of the state fee for incorporation of a company.
– Preparation & drafting of declaration under Article 13, paragraph 4 of the Commercial Register Act signed by the applying managing director.
– Preparation & drafting of nessesery license or permit according to any special law on the performance of a specific business.
Terms & conditions for set up of public company in Bulgaria
For an application for registration or deregistration – no later than the end of the first business day after its acceptance.
For an application for notification, it is immediately.