While numerous countries all over the world are imposing new restrictions on companies registered in tax havens, the Bulgarian government has recently eased the laws governing offshore ownership.
Following the recommendations of the European Commission, the new amendments of the Bulgarian Offshore Law now permit offshore entities to own up to 10% of Bulgarian companies engaged in specific business activities, such as printing periodical publications and conducting research on public opinion. The ownership threshold of 10% is applied cumulatively, i.e., two or more offshore companies are not allowed to own more than 10% of a Bulgarian company falling within the scope of the amended law.
Although the previous version of the Bulgarian Offshore Law did not contain a general prohibition for offshore companies to own Bulgarian companies,it prohibited offshore companies from owning shares in specific types of Bulgarian companies. The amendments easing those restrictions came into force on 1st of July 2016. The Bulgarian legislation specifies 49 jurisdictions that are considered to be tax havens. Such jurisdictions include Bahamas,Cayman Island, Dominican Republic, Hong Kong,Seychelles, United Arab Emirates, and Uruguay.
The violation of the Bulgarian Offshore Law may result in monetary sanctions, which vary between BGN 10.000 (about EUR 5.000) to BGN 1.000.000 (about EUR 500.000).