Registering a holding in Bulgaria is comparable to the procedure to form a normal company. However, a holding company needs to comply with some extra conditions. A holding company will alson have the special status ‘holding’ in the Bulgarian trade register.
Business types that can be a holding company
The Bulgarian companies act defines ‘holding’ as follows:
- a company in the form of a (E)AD, KDA of (E)OOD, of which the company’s objects are to hold and manage shares in other companies or managing of other companies without having any other commercial purpose
- at least 25% of the company’s capital has to be invested into subsidiary companies
A subsidiary is a company in which the holding will participate in for at least 25% or will hold at least 25% of the shares or will represent at least 50% of the management board of the company.
Description of the objects of a holding company
The objects of a Bulgarian holding company can be:
- acquisition, management, evaluation and sale of shares or participations in Bulgarian and foreign companies
- acquisition, management and sales of bonds
- to acquire, evaluate and sale of patents and commissions on licenses for the use of patents of any company in which the holding company participates
- financing companies in which the holding company participates
A Bulgarian holding is prohibited from:
- participating in any company that isn’t a legal entity
- acquiring licenses which don’t belong to any of the underlaying companies
- acquiring real estate which isn’t meant forn own use. Acquiring shares in a real estate company is allowed.
Lending money with a Bulgarian holding company
A Bulgarian holding company may only lend to companies in which re the holding as a direct participation or in which the holding has direct control. Sums lended may never exceed 10 times the capital of the holding company. Deposits of subsidiaries may not exceed the value of 3 times the capital of the company.
Formation procedure of a holding company in Bulgaria
The formation procedure is comparable to the procedure of a Bulgarian OOD or Bulgarian AD. During the registration proces the company will get the status ‘holding’ in the Bulgarian trade register. There is a higher fee for registering a holding company.
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