Last Updated on November 8, 2023 by Bulgarian attorney
Setting Up a Foundation in Bulgaria: A Guide
A foundation is a legal entity that is established for charitable or non-profit purposes. Setting up a foundation in Bulgaria can be a great way to give back to the community and support causes that you care about. This guide will provide an overview of the steps involved in creating a foundation in Bulgaria.
The Foundation as a Way of Asset Protection in Bulgaria
Establishing a foundation in Bulgaria can provide some level of asset protection. A foundation in Bulgaria is a separate legal entity that holds its own assets and can enter into contracts and conduct transactions on its own behalf. This means that any assets transferred to the foundation are legally separated from the assets of the founder or any other individuals involved in the foundation.
In the case of a legal dispute, creditors or claimants generally cannot seize the assets of the foundation to satisfy debts or obligations of the founder or other individuals involved. This can provide some level of asset protection, as long as the foundation is properly established and managed in accordance with Bulgarian laws and regulations.
Step 1: Choose a Name and Purpose
The first step in setting up a foundation in Bulgaria is to choose a name and purpose for the foundation. The name should be unique and not already registered with the Bulgarian Commercial Register. The purpose should be a charitable or non-profit cause, such as education, healthcare, social welfare, environmental protection, or cultural preservation.
Step 2: Draft a Statute
The next step is to draft a statute, which is a legal document that sets out the purpose and rules of the foundation. The statute should include the following information:
- The name and purpose of the foundation
- The address of the foundation’s registered office
- The number of members of the foundation’s board of directors
- The powers and duties of the board of directors
- The procedure for appointing and removing board members
- The procedure for amending the statute
The statute should be drafted by a lawyer with experience in Bulgarian foundation law to ensure that it complies with all legal requirements and protects the interests of the foundation.
Step 3: Fund the Foundation
To set up a foundation in Bulgaria, it is crucial to open an escrow account with a Bulgarian bank. This account will serve as a designated repository for the founding donation, specifically in the case of cash contributions. To alleviate the requirement of a personal visit to Bulgaria for opening the escrow account, we can assist with a ready-made foundation.
Ready-made foundation in Bulgaria
A ready-made foundation in Bulgaria offers a streamlined process for transferring ownership. With just a few documents to certify and a waiting period of 5-7 working days, the change of ownership can be made official with the Bulgarian Commercial Register.
Step 4: Register the Foundation
Once the statute has been drafted and the donation has been deposited into the escrow bank account, the subsequent step is to register the foundation with the Bulgarian Commercial Register. The registration process typically takes a few days to complete.
Step 5: Maintain the Foundation
Once the foundation has been set up, it’s important to maintain it properly. This involves ensuring that the board of directors is managing the foundation in accordance with the statute and that the foundation is carrying out its charitable activities. It’s also important to review the statute periodically to ensure that it still meets the needs of the foundation and to make any necessary changes. We can also assisting with tax consultancy and accounting for your Bulgarian foundation.
To set up your foundation in Bulgaria by a team recommended by Legal500, please get in touch.