The Investment Promotion Act (ZNI) regulates the opening of branches in Bulgaria. If you are doing business in Bulgaria, you may set up a branch there. Branches are not legal entities and cannot trade on their own behalf. They must be registered with the Bulgarian Chamber of Commerce and Industry.
The Trade Act (TZ) regulates the statutes of foreign branches. Branches themselves are not legal entities: they are part of a parent company, despite having a different location, management and their own ownership. Branches keep their own accounts, just like an independent trader, and are required to prepare a final balance at the end of each year.
Branches are registered with the Registry Agency, in accordance with the Commercial Register Act.
Many of the requirements and procedures for opening a secondary establishment are the same as for starting up a business.
To obtain a licence to carry out banking activities in Bulgaria via a branch of a bank based in a third country, an application must be submitted with the following documents enclosed:
- a verified copy of the bank's registration certificate and a document from the registration body showing the current details of the bank's headquarters and place of administration, business activity, equity amount, management system and the persons representing the bank;
- a verified copy of the permit to conduct banking activities issued by the body responsible for banking supervision where the bank is based;
- a verified copy of its statute;
- the branch's business plan, including a description of the activities the branch is intending to conduct;
- the branch's organisational structural plan;
- annual financial reports for the last three years;
- written consent for the opening of the branch from the banking supervision body where the bank is based;
- written statement by the body for banking supervision where the bank is based, containing information regarding the bank's financial status, and undertaking the commitment to cooperate with the Bulgarian National Bank;
- details about the people, who have been appointed to manage the branch, including their qualifications and professional experience in banking;
- other information and documents, as set by regulation or requested from the Bulgarian National Bank, in order to establish all circumstances necessary to carry out an assessment on whether the conditions are there to issue a licence or not.
The Bulgarian National Bank notifies the European Commission and the European Banking Committee of every banking licence it issues for branches of banks based in third countries.
Branches must be registered with the Commercial Register, which is managed by the Registry Agency.
Applications to register branches may be submitted to any of the Agency's regional departments at the head offices of local courts of justice.
Branches have to be registered by representatives of the foreign commercial entity or by a lawyer who has express written authorisation to do so.
Applications to register branches are made by completing a form that may be submitted electronically or as a hard copy.
The application must come enclosed with the following documents:
- a notarised agreement, signed by the branch manager;
- a copy of the contract made between the enterprise and the branch owner;
- a certificate of registration of the foreign entity as a trader;
- a verified copy of the permit issued by the relevant body to open the branch.
Many of the requirements and procedures to open a branch are the same as for starting up a business.
Points of Single Contact in Bulgaria
The Services Directive is an EU law that facilitates enterprises that would like to provide services in the European Union— whether it be in their own country or elsewhere. The directive sets the rules that apply to entrepreneurs who would like to start businesses or to provide temporary services in the EU/EEA (the 27 EU Member States plus Iceland, Lichtenstein and Norway). It requires Member States to eliminate needless bureaucracy, to simplify formalities for companies and to make public administrations more efficient.
In implementing the Directive, each Member State had to set up 'Points of Single Contact (PSCs)': e-government portals that allow companies to carry out their administrative procedures online. PSCs provide comprehensive information on all administrative issues dealing with setting up or expanding service companies in any EU country. This includes, for example:
- Which licences, notifications or permits do I need to start a business in any EU country?
- What do I need to do when I want to offer my services abroad on a temporary basis?
- How do I apply for a licence? Which organisation is responsible for dealing with my application?
- Do I have to pay a fee? How long will it take to get my licence?
- What laws and regulations are applicable to my business sector?
- What do I need to do to set up, for instance, a restaurant or a shop? Or to work as a tour operator in another country without actually setting up a permanent office in that country?
- Where can I go for further advice and information?
Thanks to the PSCs, you no longer have to go to individual offices of different authorities one by one!! PSCs allow you to find out all the information you need and to send your online applications to the responsible authority through one single access point, the PSC. You can complete administrative formalities online through the PSCs. Simply contact the PSC in the country you would like to start a business.
All PSCs are part of the European network EUGO; you can easily get in contact with all PSCs in Europe via the main website. Of course, PSCs are only just one of the options available to you. You can always contact the relevant authorities directly.