The property. Bulgaria

"Forewarned is forearmed". This statement is suitable for majority fields in business area and for real estate market too. Where is planning price rising and where is reducing and why, market of what country choose, in what invest your money - long-term or short-term perspectives? To find the answers for all of this questions more easer when you keep a clear line of sight, what a real estate development for the coming year, experts predict...

Bulgaria is European country and a big amount of foreign investment give an incentive for permanent development in all activity fields. A considerable share of investments directed to the real estate sector, what in turn give a good prospect.

According to prediction - real estate market of Bulgaria will be rising in 2016. Unstable economic and political situation in Ukraine, conflict situation in Turkey ad Egypt play into the hands for Bulgaria. All this events induce interest among the citizen of these countries to the fallback maneuvers. Costumers of building company more often account a proposition for year-round stay, if so that in case of aggravation of the situation in the country could safely take the suitcase and leave.

An interest of Russian side is rising, Poles and Ukrainian step on them toes. On the real estate market returned buyers from Britain. Cut deals with citizen of Israel, Greece, Germany and Romania. Such a flow of stakeholders pushing the major developers in the sales increase and the rise in real estate prices. Such prospect refer to some big cities as Sofia, Burgas, Varna. At the same time, the proposed facilities at ski resorts will not be ignored. Bulgarian and foreign buyers are interested in it. The demand and interest in real estate on the coast will stay on the high level.

All is palpable interest in the acquisition of property in order to preserve their capital. Interest in the Bulgarian real estate market is growing not only by local, but also foreign citizen. For today noticeable appearing of new big investors. The main part of the purchase of real estate transactions in the "Solar Palmyra» held with international participation. Based on data collected over the last few months of last year, some of the funds asset management began to consider Bulgaria as a "platform" for a number of major transactions. We expect that the confidence of foreign investors in Bulgaria will increase by several times, and thus increase the amount of capital invested, not only in 2016 but in subsequent years as well.

Summing up, we can conclude - the real estate market is versatile. Assessing the buyer - the positive trends in the face: growth in the number of construction companies; increase choice and demand for construction projects; increase the level of service, quality built; reduce the cost of square meters; increase the availability of mortgage lending. These trends give hope for the launch of affordable and safe housing arrangements in the near future.

Author: Vita Orlova

head of real estate department

Legislation in Bulgaria

In each developed country in the world, the main title documents, which shows all the state laws that have legal force, regulating the political, economic and legal system of the state is the Constitution.

The main difference of Bulgarian legal system - transparency and accessibility. Before signing, the law is manifesting in the state newspaper "The State Gazette ". The newspaper publishing innovations, additional information on the laws; Ministries edicts; information regarding the opening of firms and changes in the authorized capital; proceedings in legal cases, etc. As soon as the laws came into force, they can be found in the city libraries, government organizations and companies. In addition, the information base can be removed from the Internet resources, specially designed sites.

For the first time, the content of the legal part of the Constitution of the Republic of Bulgaria, was published in the "State Gazette" in 1991. To your review there is a brief summary legislative framework of Bulgaria below:

  • «The law on the Bulgarian citizenship»;
  • «Aliens Act»;
  • «The Law on Local Taxes and Fees shall»;
  • «The law on the right of ownership»;
  • «Foreign Investment Law».

«The law on the Bulgarian citizenship» According to the content of the law, published 31/05/2002, you can become a resident of the State in certain cases: at the time of submission of the application the applicant must be the age 18; a permanent residence permit in the country has been issued not less than 5 years ago; the applicant has no criminal record on the part of the Bulgarian state, it is not on the wanted list and not under investigation; is employed and is able to fend for oneself; speaks the state language and does not have citizenship of another state (full description in Art. 12 of the Law).

Also, applicants for obtaining Bulgarian citizenship may be persons who are married to a resident of the country, were not suspected of fictitious union; born on the territory of the State; as well as persons who in the period to adulthood were entitled to a permanent presence in the country (full description in Art. 13 of the Act).

Applicants who do not meet the requirements of Articles 12 and 13 of the law on citizenship, can it get for their outstanding achievements in the economic sphere; thanks to social activities; to be discoverers in the field of technology and science; be a cultural worker and have achievements in sports (for a complete description of Art. 14 of the Act).

«Aliens Act» Contents of the law, published 08/10/2004., about finding in the State implies that an alien may remain lawfully in the country for short and long term. Short-term - are allowed to stay on the territory of Bulgaria for a period of up to three months; long-term - up to one year or with no stated maturity (on a permanent basis).

According to the text of the law, persons who provided permits to engage labor activity in the country have the right to a long presence on the territory of the State; entrepreneurs operating in Bulgaria and have provided working places at least 10 Bulgarians; working under an international treaty on cooperation; students coming to study; patients referred for treatment at local medical facilities.

Also, applicants for a long-term presence in the country may be the persons who have entered into marriage with a resident of a country or a foreigner staying in the country on a permanent basis; financially independent parents of foreigners living in Bulgaria; family of a foreign citizen who already has the ability constantly presence in the country; representatives of foreign companies who have registered at the Chamber of Commerce and accredited representatives of foreign media.

In the article 25 of the "Law on Aliens" in addition to article 24 indicate that the foreign individuals who made invest in the economy more than 250 000 euro shall be entitled to a long stay in the country.

All foreign persons, who are in age group over 14 years, which is allowed to reside in Bulgaria for more than 3 months, receive an identification document that acts as an international passport.

«The Law on Local Taxes and Fees shall» Any activity of physical persons - entrepreneurs in Bulgaria is taxed. The tax rate - 20% (VAT). The exception is the tourism industry - 7%. Companies that do not own the patent tax pay 10% income tax. Private entrepreneurs at the end of the tax period pay the annual tax. Movable and immovable property in Bulgaria also subject under Article of tax payment. The owners of the property register it with the tax authorities in the two month period after purchase or completion of construction. If the purchased housing is acquired permanent residence, the tax rate is reduced by 50%. All inhabitants of Bulgaria pay fee for household waste, the rate is set by the local municipality.

The process of purchase - sale of farm buildings and land are not subject to VAT.

«The law on the right of ownership» According to the description of the Heads of the Constitution of the Republic of Bulgaria, foreign citizens, legal persons who residing or registered in the country, lawfully, with the same rights as the citizens of the country manage the purchased property, to dispose of it at their discretion. The right of ownership does not apply to the land, the exception applies only to the inherited land. Inherited land after three years of ownership must be necessarily transferred into the possession of the local residents.

The law states that all foreign persons including legal, may legitimately be owners of buildings; have a limited right to immovable property, except in cases that are not within under the description of the law.

«Foreign Investment Law», «Investment Promotion Act» since 2004. According to the text of article number 97 of the law, promulgated 24/10/1997, a non-resident may become the investor of the country; company or legal entity registered outside Bulgaria. These categories of foreign persons can make investments in the economic development of the state sector on an equal footing with the Bulgarians (full description in Article 2 and Article 5 of the Law).

Permitted sectors for capital investment - movable and immovable property; stocks; securities and bonds issued by the state, legal organizations and communities. The investor has the right to own certain percentage of shares of the company or be a major shareholder (full description in Article 12 of the Law).

Foreign persons who invested in real estate, own it with the same rights as the citizens of the country. If the investment is greater than EUR 500 000, granted the right to permanent residence in the territory of the state. The law establishes restrictions on the ownership of land. The exception is valid only for foreigners who received the land as an inheritance.

In given article was published a summary of the individual cases that fall under the description of the laws of the state of Bulgaria. The literal content of the legal framework is available on the official websites of the Republic of Bulgaria.

Author: Vita Orlova

head of real estate department

Ure charge in Bulgaria

Opening a firm in Bulgaria can give you a lot of advantages. Presence of entity will allow you to buy agricultural property and capital facilities, to use credit organization services sigh agreement on leasing, to use a wide range of services on an equal footing with residents. The main advantage is a possibility to operate commercial project on the EU territory.

Registration and opening entity in Bulgaria Republic - LLC, SMLLC (Single Member Limited Liability Company) - it's not easy process, in what take part attorney at law and lawyer.

During preparing registration, documents need to choose registration form for future company.

LLC - Limited Liability Company - more often used registration form. Founders of such company have responsibility for capital identical to further capital; do not responsible for the circumstances that may fall on the company.

The main advantage of opening LLC is a small capital - 2 Bulgarian lev. This form of registration is suitable for owners of small and medium business, buying agricultural property and capital facilities.

Joint-stock company - registration during opening and cooperating of big business projects. In Bulgaria there are only two kinds joint-stock company and personal joint-stock company. Founder is owner of registered capital. Also it's possible registration of individual entrepreneur - not common - the head is fully responsible with their property.

After choosing, the government next step is opening. The process of opening LLC takes 1-2 weeks.

Counting from the date of submission of all documents, registration in the relevant government bodies. Preparing the documents takes 2 weeks. Opening can be manage remotely, after issuing a power of attorney to a person ( an attorney of law , a lawyer ) , which is responsible for registering on the site.

Preparing the documents has a range of cobwebs. The main point is making an agreement for LLC, where descripted all conditions of company work. After registration step need to understand will this company works or not. If not, annually file a tax, if it will work - it carried out a series of formalities competent accountant. Very important aspect is to point out the address of company. The address must be valid.

The most common version of the company in Bulgaria - registration for the purchase of real estate or land. In the case of purchase of real estate in the name of the company is necessary to issue a number of documents, guaranteeing a perfect passage deals with the accounting, and from a legal point of view.

To avoid trouble, property sanctions from the tax office, the registration and the opening of a specific form of government must be held, accompanied by a qualified specialist . Law firm «Finance Business Service» will help you pull of the task.

Author: Vita Orlova

head of real estate department