Commercial & Company Legal Services
Corporate Services by Experienced Bulgarian Solicitors
We provide personalized legal services to both medium-sized companies as well as major international corporations in virtually all business areas, such as M&A, restructuring, business formations, due diligence, privatization, concessions, labor law, bankruptcy and liquidation.
Restructuring, Mergers & Acquisitions and Business Formations
Merging of different enterprises into a single formation, as a result of acquisition or merger of assets or other transferable rights, is one of the most important means for corporations to expand their business and enhance their financial performance. With the rapid globalization and the influx of new telecommunication technologies, businesses from around the globe began working closer, which has led into a sharp increase of the M&A and restructuring deals in the recent years. On a local level, since Bulgaria joined the EU in 2007, this sort of transactions have become the backbone of many foreign investment strategies and market penetration techniques. The opportunities look endless, but so are the legal challenges.
Merging assets internationally or acquiring new ones requires not only solid business strategy and a lot of spirit, but also a good knowledge of the legislation in the target country. Mergers and acquisitions demand in depth understanding of the business environments of all parties involved and are also, often, subject to regulatory approvals. Our team can act on behalf of the customer in order to facilitate these processes. Our specialists are experienced in different business areas and can help the client with profound knowledge and skills in virtually all economic sectors.
Unlike merging, acquisition or restructuring of existing entities, setting up a brand new business presents another unique challenge. Often, the would be investor is faced with the worrying perspective of diving into another country’s business and legal rules without a solid backup from professional advisors. Setting up a new company in Bulgaria may be a straightforward procedure, but if handled by non professionals, can lead to many potential hurdles at a later stage. With the lowest EU corporate tax in Bulgaria of only 10%, alongside many other administrative and legal benefits, starting business in Bulgaria by foreign companies and individuals has skyrocketed in recent years. As expected, the problems arising from unskilled legal work at the starting phase of the incorporation, began to emerge, and are now flowing into the court rooms. This is a scenario someone would like to avoid at all costs. Our legal advisors will be able to assist you in case you are already having similar difficulties. If you are considering entering the Bulgarian market by registering a new legal entity, we will advise you on the most appropriate structure for your particular needs. Once a decision is taken, we will register your Bulgarian Limited Liability Company (LLC or LTD), Joint-Stock Company or any other form of business model. We will assist you to obtain all required licenses and permits in order to start your operations without any delays or legal obstacles. We will also register all forms of non-profit NGO’s, such as foundations, clubs, charities, etc.
Due Diligence Legal Services
When a business deal is to be concluded, which involves legal transfer of certain assets, the parties (most often the buyer) often require professional report on the current state of their counterpart’s business – a due diligence . This report is not a mere financial or legal report, showing the entity’s current state of affairs – it is a way to identify what is hidden under the surface. The report will identify and assess certain risks, which will enable the purchasing party to negotiate and demand from the seller a set of warranties. These warranties will typically relate to certain actions that will need to be taken by the seller in order to remove some irregularities related to the assets being transferred, which irregularities would otherwise present a serious obstacle for the buyer. The due diligence report is often a legal prerequisite for the buyer in order to have the deal approved by its supervisory body or by its investors. Even when there is no legal requirement for a due diligence, having the report prepared is often the most important factor for the party to take a well informed decision.
Depending on the structure and the size of the contractual transaction, as well as the type of assets being transferred (e.g. company shares, financial instruments, real estate, etc.), the due diligence report can be either limited to the specific asset, or cover all aspects of the contracting entity as a whole. Our approach to each and every due diligence project is flexibly adjusted to our customer’s requirements. We do our utmost to be not only fully objective, but to also interpret and explain the Bulgarian local laws and customs to our customer, in order to guarantee unbiased review of all issues.
Based on our experience, we believe that we are in position to perform all necessary researches and prepare even the most sophisticated and comprehensive due diligence reports in Bulgaria. Our knowledge of the local legislation, combined with the in depth experience of our professionals in different fields of the Bulgarian business, provide us the unique chance to be ahead of most of our competitors in Bulgaria.
Privatization and Concessions
The privatization of state property is considered the core of the market economy as well as a mean of financing for the government. In Bulgaria, the privatization process began in the early 90’s. During the years, the privatization processes have evolved and are now encompassing a few different techniques. Our specialists have legally advised many customers and provided legal solutions for a hassle free privatization process. The privatization of state property doesn’t end where it starts – at the legal transfer of the property. The whole post-privatization process is carefully monitored by the Privatization and Post-Privatization Control Agency (PPCA) and it is of essential importance for the deal to be finalized ultimately with the expiry of the transition privatization period. The processes are accompanied by joint tenders for state and municipal companies, which again, require serious legal backup by professional teams.
Concessions, in a way similar to privatization, provide another unique opportunities to both Bulgarian and international investors to gain access to many of the Bulgarian resources. Immediately after the political transition took place in Bulgaria in 1989, many foreign investors realized the enormous potential of the country’s natural resources – precious metals, mineral water, recreation resorts, etc. The legal framework of concessions is one of the most complicated and sophisticated as it has to comply with the national legislation and at the same time be consistent with EU laws. Therefore the legislation is often being revised, which leads to confusion among potential foreign investors. Our specialists are constantly being called upon to support customers who are cautious about their concession contracts and rights and are therefore counting on professional legal support.
Bulgaria’s accession to the European Union in 2007 provided new opportunities for both Bulgarian companies to hire EU citizens as well as European Union companies to employ Bulgarian nationals. The labor legislations however often generated uncertainty among businesses of all sizes. Businesses in Bulgaria were at times struggling to comply with all different norms, which originate from both the national laws as well as the European directives. The legal issues which arose are often of great complexity and require professional approach and analysis.
It is also worth mentioning, that the reduced volume of work in some Bulgarian companies, mainly due to bad organization and structuring skills, have led to a real legal challenge for those companies in their effort to reorganize their employee structure. Either by layoffs or by serious restructuring procedures, these companies had and have to comply with many different regulations and legal requirements. In this connection, our team has focused on identifying these issues in order to provide sustainable solutions that are both protecting all parties’ interests as well as are fully compliant with the current labor laws. We spend great deal of our time and effort working on the new opportunities provided by the amendments of the Labor Code of 2011 concerning work from home, distance work and temporary employment. These amendments came to provide unique opportunities to Bulgarian and EU workers in order for them to seek and find jobs in different jurisdictions, avoiding great deal of the usual time and residential constraints.
Bankruptcy and Liquidation
As all good things in life, businesses, no matter how profitable initially, sometimes end their existence. Whether the decision is taken voluntary or not, the legal consequences are enormous – for both the ceasing company and its creditors/debtors.
The economic situation in Bulgaria and the world as a whole has direct impact on the financial state of the businesses in Bulgaria. The relatively liberal credit environment in Bulgaria led to a growing business to business indebtedness. This in turn transformed into an increased number of liquidation and bankruptcy processes.
Our team has steadily expanded its services to our customers in the last years. We provide legal support to both companies who want to have their liquidation process legally backed as well as those who seek debt recovery. Legal processes of this kind are complicated and require specific knowledge. Our team members have proven themselves to be of great assistance in such legal cases.