Investing your capital in Bulgarian projects
will increase the value of your European portfolio
The main reasons why you should invest in Bulgaria
- The membership of Bulgaria in the European Union;
- Free trade with preferential partners of the EU, including EAST, Turkey, Mediterranean countries, Western Balkan countries, South Africa, Mexico, Chile and others;
- 10% corporate income tax;
- 10% personal income tax;
- The possibility of exemption from VAT on import of equipment for investment projects over 5 million euro;
- Attractive and strategic geographical location;
- The lowest cost of operation and tax rates in the whole Europe;
- Stable and predictable business and political climate;
- The annual 30% depreciation of machinery and equipment, 50% - for the new equipment used in the initial investment and 50% - for software and hardware;
- Agreements on the cancellation of double taxation with 61 countries in the world;
- Agreement on mutual protection and preferential policies towards foreign investment with 60 countries;
- Ability to purchase land and property through Bulgarian registered company with 100% foreign ownership;
- Acceleration of administrative procedures through the Bulgarian Investment Agency;
- Attractive, despite the global economic crisis, Recurrence of investment in real estate - between 7 - 8%;
- Prices of real estate in Bulgaria are still among the lowest in Europe;
- Infrastructure;
- The government has repeatedly affirmed the continuation of prudent fiscal policy and to support the budget deficit to within less than 3% of GDP in order to prevent external risks (currently Bulgaria is even 3% of the surplus);
- Adoption of international accounting standards;
- Highly multi linguistic labor out of competition in the whole Europe, wages;
- Natural and cultural attractions, excellent cuisine, warm hospitality, traditional cultural historical ties between Bulgarian and Russian peoples;
- The Investment Encouragement Law sets forth preferential treatment measures for investments meeting certain criteria specified as follows:
1. The investment to be in fixed assets acquisition with the purpose of creating new or enlarging, or modernizing existing production of goods and/or services;
2. New jobs to be created;
3. The investment project to be implemented within 3 years;
The measures are differentiated according to the class of the investments, as the latter are grouped in three classes, depending on the investment project value. The value thresholds are set forth in the Rules on the Enforcement of the Investment Encouragement Law as follows:
1st class – investment over BGN 32 million (€ 16 million);
2nd class – investment from BGN 16 million (€ 8 million)
For all investment classes, central and territorial executive authorities, as well as local self-government authorities provide administrative services (issue of licences, permits, etc.) to investors within time limits which are 1/3 shorter than the normal ones.
For 2nd-class investments Invest Bulgaria Agency provides investors with:
- Information services and
- Individual administrative services with respect to all central and regional bodies of the Government. Investors will have the opportunity to authorize officials of the Agency to obtain from the corresponding competent bodies on investors’ behalf and for investors’ account any documents necessary for implementation of the particular investment project as may be required under the existing legislation.
For 1st-class investments, Invest Bulgaria Agency assists investors by providing:
- Individual informational and administrative services
- Assistance with real estate “titling” issues – On the request of the 1st-class investor the Agency may propose to the corresponding authorities to transfer ownership rights or establish limited ownership rights over real estate, necessary for the implementation of the investment project (private, state or municipal property) without a tender or on preferential prices.
- Resources for building elements of technical infrastructure, necessary for the implementation of the investment plan to the borders of the investment project site
Foreign investors are confident that Bulgaria is an attractive and profitable place for direct investment. At the moment, investors are increasingly focused on the industrial segment, due to high expected income from production and sales of products throughout Europe.
According to research company Ernst & Young Southeast Europe for 2008, Bulgaria was the most attractive target for investment due to the 10% income tax, reasonable prices and flexible working hands of the law. Also in the report it was noted that in the case of improvements in telecommunications, transport and logistics, Bulgaria will be among the leaders on the return on investments.