• all servers and electronic equipment has to be located physically in Bulgaria
• at least one of the servers which receives the traffic  data over the Internet, has to possess domain in .bg area.
• the gambling software needs to collect records of the users, as well as to have the ability to provide data to the Gambling Commission upon request
• each game, included in the Internet gambling license, has to match the requirements for the regular gambling, as described in details in the Gambling Act.

The status of the bill can be reviewed in the website of the Bulgarian Parliament

The process of obtaining a regular Gambling license consists of providing the necessary documents and applying with the Gambling Commission. Foreigners can also apply for gambling license. You can apply as a company, registered in EU or as a Bulgarian company (subsidiary of your original company). If your company is  registered neither in EU member country nor in Bulgaria, you need to match certain investment requirements before you obtain the gambling license. Depending on what games you want to develop, there are different options for gambling license: casino games, lotto games, bingo and keno, lottery, sport betting etc.

The tax on the gambling profit is flat 15%. The gambling tax excludes paying the corporate tax i.e. the gambling companies pay ONLY 15% gambling tax. Additionally you may want to get the dividend from the company profit, which will add 5% tax to the money you get from your gambling company.

However, the company just took the £ 5000 and seized the construction. This leads all investors to a dead end. The company website is now closed and the buyers consider themselves as a victims of fraud.

However not everything is lost. Our lawyers have performed a legal due diligence of Bulgaria BTL. Here is what we found:

Company name: Bulgaria Buy To Let LLC,

Company file No 131436790

Registered addres: Sofia, 36 Dragan Tzankov Blvd, Entr. B, floor 5, office 501

Manager: Simon Cristofer James Also

Shareholders: 1.Ingrid Grace Also and

2.Anil Kohli

Registered capital of the company: 5000 levs (about EUR 2500)

Since 2008 there are no activities in the commercial register company file, initiated by the manager. This should be a sign that the company is left. The Commercial register shows that Anil Kohli’s shares has been seized by the court. This seizure is initiated by a Bulgarian citizen. Our legal interpretation is that most probably Anil Kohli owes the Bulgarian person certain amount of money ( EUR 94600, to be specific) and therefore the court has issued a seizure order against Anil Kohli, consequently seizing his shares in the company.

The legal due diligence showed also that the company owes a factory for producing wooden materials for house construction. So far there are no liens over that property, so the quicker creditors get their claims filed in court, the better chance they have to get their £ 5000 back. The factory can be seized so, it will stay there for the plaintiffs, no matter how long the case lasts in court. After getting the positive court resolution, the creditors could put the factory on a public tender, sell it and get their money back. The latter should be done via law enforcement agent.

If you fail to re-register on time, your company will be liquidated by the court and official state liquidator will be appointed. The consequence of this will be that your company’s assets will be sold on public tender and the liquidator’s salary will be paid out of that assets.

Don’t miss the deadline!  You can loose your property and you will bear liability for all expenses made in court for your company liquidation.

Article 2. (1) The management of common areas of buildings under condominium ownership arrangements in closed-type residential complexes shall be agreed by written contract with notarially certified signatures, concluded between the investor and the owners of individual units.

Pursuant to the new Condominium Act the condominium is managed by a body called General Assembly of the owners or association of owners. Basically it has the powers of a General Meeting in a company. One of the most important powers the General Assembly of the owners is stipulated in Art.11, para 1 point 11 :

Article 11. (1) The General Assembly:

……….

11. may adopt a decision to assign maintenance works on the common areas of the building to a legal entity or natural person in return for remuneration, also establishing the specific powers of the Managing Council (Manager), which can be assigned for implementation by these persons;

This means that the General Assembly can vote to replace the current property management company with  another one when certain requirements are not met or there is another important reason for that.

You can read the full Condominium Ownership Management Act HERE

The preliminary agreement is regulated in only 1 article in the Agreements and Obligations Act and nowhere else:

19. (1) A preliminary contract preceding the conclusion of a final contract for which a notarial deed or notarial certification is required shall be concluded in writing.

(2) A preliminary contract shall contain provisions concerning the material terms of the final contract.

(3) Either party to a preliminary contract may bring an action for conclusion of the final contract. In this case the contract shall be deemed concluded as of the moment of entry into force of the ruling of the court.

In short, this is just written promise that the final agreement will be signed (i.e. title deed). Of course, the preliminary agreement for construction of property is more complicated than just ordinary preliminary agreement. The preliminary construction agreement consists of two basic contracts:

• the ordinary preliminary agreement as per Art.19 of the Agreements and obligations act and
• agreement of manufacture . It is also regulated in the Agreements and Obligations Act (you can read the regulation of this type of contract below)

VIII. A CONTRACT OF MANUFACTURE

258. Under the contract of manufacture the contractor shall be liable at his own risk to manufacture something in accordance with the other party’s order, and the latter — to pay a compensation.

259. Unless otherwise agreed the contractor shall manufacture what is ordered with means of his own.

260. The contractor must immediately inform the other party if the provided designs or supplied materials are unfit for the correct performance of the work, and ask for the necessary changes in the designs or for the supply of appropriate materials. If the other party fails to do so the contractor may renounce the contract.

If the contractor fails to provide the above warning, he shall be liable before the other party for the damages caused.

261. The contractor must perform the work in such a manner that it becomes fit for the usual or stipulated in the contract purpose.

The contractor who is performing the work with his own materials is responsible for good quality.

Where several persons have assumed the obligation to perform together certain work, they shall be liable jointly and severally, unless otherwise agreed.

262. The person ordering the work may check the performance of the contract at any time, provided he does not disturb the contractor.

(Amended, SG No. 12/1993). If it becomes evident that the contractor will not be able to perform the work on time or that he will not perform it in the way agreed upon or as due, the person ordering the work may avoid the contract and claim damages under the general rules.

263. The risk of chance loss or damage of the materials shall be borne by the party providing them, if the other party is not in default.

264. The person ordering the work must accept delivery of the work done in accordance with the contract.

Upon accepting delivery he shall examine the work and shall state all the objections for improper performance, except for such defects which cannot be revealed through the usual manner of acceptance of delivery or for such which are revealed only later. The person ordering the work shall inform the contractor of such defects immediately after they are discovered. This shall not be necessary when the contractor was aware of them.

If no such objections are raised, the work shall be deemed accepted.

265. If during the performance of the work the contractor has deviated from the order or if the work done has deficiencies, the person ordering the work may claim:

repair of the work within a stipulated by him period without payment;

covering of the expenses needed for the repair or a respective reduction of the compensation.

If the deviation from the order or the deficiencies are so material that the work is deemed unfit for its contractual or ordinary purpose the person ordering the work may avoid the contract.

These rights shall be extinguished by limitation within six months, and in case of construction work — within five years.

266. The person ordering the work shall pay compensation for the accepted work. If the compensation is agreed upon on a unit price basis, its amount shall be determined upon acceptance of the work.

If in the course of the performance of the contract the duly determined prices of materials or labour change, the compensation shall be adjusted accordingly, even where it was agreed upon as a total sum.

(Paragraph 3, repealed, SG No. 12/1993).

267. If the performance of the work becomes impossible due to a reason neither party is liable for, the contractor has no right to compensation. If one part of the work was done and may be of use to the person ordering the work, the contractor is entitled to a respective part of the agreed compensation.

The contractor shall be entitled to compensation if the performance of the work has become entirely or partially impossible due to the unfitness of the materials or designs provided by the person ordering the work, and the contractor has duly notified him.

268. If there are reasonable grounds the person ordering the work may renounce the contract, regardless of the fact that the performance has begun, by paying the contractor for the costs incurred, the work done and the profit which he would have obtained from the performance of the work.

(Paragraph 2, repealed, SG No. 12/1993).

269. If the contractor dies or becomes unable to proceed with the work the contract shall be terminated, unless it was concluded with regard to the person of the contractor and his heirs agree to proceed with the work.

Upon the termination of the contract the person ordering the work shall pay for the work done and for the usefully invested materials in accordance with the contracted compensation.

So now you see that the essence of the preliminary agreement for buying offplan property is very complex. I will interpret the nature of the offplan property purchase agreement at a later stage.

Since there are only few Factors acting in Bulgaria, the market is not well developed. There are few more Factors, which buy Debt Portfolios but they are in the grey economy. Non-bank financial institutions are not yet at the Bulgarian Factoring market, although there is a very good perspective for collectable debt portfolios.

If you intent to buy a startup business, having its first months behind, then you can buy that enterprise in two ways:

1. Buy the shares of the company via signed and notarized agreement or,
2. Bye the whole enterprise i.e. everything except the company name. This also will be done through a written and notarized agreement.