2017 Investment Climate Statements: Bulgaria

Policies Towards Foreign Direct Investment

At present, there are no general limits on foreign ownership or control of firms, nor is there screening or restricting of foreign investment in Bulgaria. Companies with more than 10 percent offshore participation are banned from doing business in Bulgaria across 28 specific activities, including in government procurement, natural resource exploitation, national park management, banking, and insurance, but certain exemptions are available.

While Bulgaria generally affords national treatment to foreign investors, there are reports of discrimination against U.S. investors by government officials. Investors more often cite general problems with corruption, rule of law, frequently changing legislation, and weak law enforcement. Transparency International’s (TI) Corruption Perception Index for 2016 ranked Bulgaria 75th out of 176 countries surveyed – the lowest-ranked EU member state.

The Invest Bulgaria Agency (IBA), the government’s investment coordinating body, provides information, administrative services, and incentive assessments to prospective foreign investors. The 2004 Investment Promotion Act stipulates equal treatment of foreign and domestic investors. The law encourages investment in manufacturing and high-technology, as well as in education and human resource development. It creates investment incentives by helping investors purchase land, providing state financing for basic infrastructure and training new staff, and facilitating tax incentives and opportunities for public-private partnerships (PPPs) with the central and local government.

The American Chamber of Commerce (AmCham) publicizes its view and coordinates with other business organizations to improve the investment climate.

Limits on Foreign Control and Right to Private Ownership and Establishment

Generally, there are no existing limits for foreign and domestic private entities to establish and own a business in Bulgaria. Foreign investors, however, often cite the following problems: a sluggish government bureaucracy, poor infrastructure, corruption, frequent changes in the legal framework, lack of transparency, and pre-determined public tenders. In addition, a weak judicial system limits investor confidence in the courts’ ability to serve as an enforcement mechanism.

The 2016 amended Offshore Company Act lists 28 activities banned for business by companies registered in offshore jurisdictions with more than 10 percent offshore participation. The law, however, allows those companies to do business if the physical owners of the parent company are Bulgarian citizens and known to the public, if the parent company’s stock is publicly traded, or if the parent company is registered in a jurisdiction with which Bulgaria enjoys a treaty for the avoidance of double taxation (such as the United States).

Other Investment Policy Reviews

There have been no recent Investment Policy Reviews of Bulgaria by international economic organizations.

Business Facilitation

Bulgaria typically supports small and medium business creation and development through strategies focused on EU co-funded innovation and competitiveness measures and programs. Export promotion takes priority, allowing the domestic economy to take advantage of its relatively low labor costs. However, the increasing need for technology upgrades and for skilled labor in many sectors could increase costs in the mid-to-long term. The government supports small-to-medium enterprise (SME) development by budgeting money for the implementation of national and local SME plans. Article 7 of the Bulgarian Small and Medium Business Act stipulates that the government SME agency should support any foreign or domestic investor interested in Bulgarian SMEs.

The most common type of organization for foreign investors is a limited liability company. The required minimum for registering a limited liability company is one Euro. Other typical corporate entities include joint stock companies, joint ventures, business associations, general and limited partnerships, and sole proprietorships. Bulgaria dropped four places in the World Bank’s 2017 Doing Business ranking in starting a new business. The report indicates it takes a minimum of 23 days (vice peer average of 10 days or OECD high income average of eight days) for a new business (a limited liability company) to register, with a minimum follow-up with government agencies and no extra payments. The process includes four major procedures: company database registration (four days), tax registration (12 days), notary certification (one day) and opening a bank account (one day). Company registration can be done also electronically at: https://public.brra.bg/Internal/Registration.ra?0 

Typically, a new business is expected to register an account in the government social security institute and, in some cases, with the local municipality as well. The above procedure applies to local as well as foreign owned business in Bulgaria.

Outward Investment

There is no government agency for outward investment promotion, and no restrictions exist for any local business to invest abroad.

Bulgaria has a Bilateral Investment Treaty (BIT) with the United States, which obligates the parties to uphold national treatment and includes provisions for investor-State dispute settlement through international arbitral bodies. The BIT also includes a side letter on protections for intellectual property rights. Upon Bulgaria’s joining the EU, Bulgaria and the United States exchanged notes in 2003 to make Bulgaria’s obligations under the BIT compatible with its EU obligations, and finalized the process in January 2007.

As of 2015, Bulgaria also has bilateral investment treaties signed with the following countries: Albania, Algeria, Argentina, Armenia, Austria, Azerbaijan (not in force), Bahrain (not in force), Belarus, Belgium, China, Croatia, Cuba, Cyprus, Czech Republic, Denmark, Egypt, Finland (terminated), France, Ghana (not in force) Georgia, Germany, Greece, Hungary, India, Indonesia (terminated), Iran, Israel, Italy (terminated), Jordan, Kazakhstan, Kuwait, Latvia, Lebanon, Libya, Lithuania, Luxembourg, Macedonia, Malta, Moldova, Mongolia (not in force), Montenegro, Morocco, Nigeria (not in force), North Korea (not in force), Oman (not in force), Pakistan (not in force), Poland, Portugal, Qatar, Romania, Russia, San Marino, Serbia, Singapore, Slovakia, Slovenia, South Korea, Spain, Sudan (not in force), Sweden, Switzerland, Syria, Thailand, The Netherlands (terminated), Tunisia, Turkey, Ukraine, United Kingdom and Northern Ireland, Uzbekistan, Vietnam, and Yemen.

As of 2015, Bulgaria has signed bilateral double taxation treaties with the United States and the following countries: Albania, Algeria, Armenia, Austria, Azerbaijan, Bahrain Belarus, Belgium, Canada, China, Croatia, Cyprus, Czech Republic, Denmark, Egypt, Estonia, Finland, France, Georgia, Germany, Greece, Hungary, India, Indonesia, Iran, Ireland, Israel, Italy, Japan, Kazakhstan, Kuwait, Latvia, Lebanon, Lithuania, Luxembourg, Macedonia, Malta, Moldova, Mongolia, Montenegro, Morocco, North Korea, Norway, Poland, Portugal, Qatar, Romania, Russia, Serbia, Singapore, Slovakia, Slovenia, South Africa, South Korea, Spain, Sweden, Switzerland, Syria, Thailand, The Netherlands Turkey, Ukraine, United Arab Emirates, United Kingdom and Northern Ireland, Uzbekistan, Vietnam, and Zimbabwe.

Transparency of the Regulatory System

In general, the regulatory environment in Bulgaria is characterized by complexity, lack of transparency, and arbitrary or weak enforcement. These factors create incentives for public corruption. Bulgarian law defines 38 operations that must be licensed, including registration and permit regimes. The law requires all regulations to be justified by defined need (in terms of national security, environmental protection, or personal and material rights of citizens), and prohibits restrictions incidental to the stated purposes of the regulation. The law also requires the regulating authority perform a cost-benefit analysis of any proposed regulation. This requirement, however, is often ignored when Parliament reviews draft bills. With few exceptions, all draft bills are made available for public comment, both on the central government web site and the respective agency’s web site and interested parties are given 30 days to submit their opinions. The government is not obligated to incorporate the comments raised publicly into the final legislation. In addition, the law eliminates bureaucratic discretion in granting requests for routine economic activities, and provides for silent consent when the government does not respond to a request in the allotted time. Local companies in which foreign partners have controlling interests may be requested to provide additional information or meet mandatory requirements in order to engage in certain licensed activities, including production and export of arms and ammunition, banking and insurance, and the exploration, development, and exploitation of natural resources.

International Regulatory Considerations

Bulgaria became a member of the World Trade Organization in December 1996.

Under the provisions of Article 207 of the Treaty on the Functioning of the European Union (Lisbon Treaty), common EU trade policies are exclusively the competence of the EU and the European Commission, which coordinates them with the 28 member states.

Legal System and Judicial Independence

The 1991 Constitution serves as the foundation of the legal system and creates an independent judicial branch comprised of judges, prosecutors, and investigators. In December 2015, Parliament adopted constitutional amendments aimed at promoting judicial independence and transparent selection of magistrates. The results from the implementation of this and other reform efforts are yet to be seen. The government has drafted several comprehensive reform plans, but their implementation has been limited. The judiciary continues to be the least trusted institution in the country, with widespread allegations of corruption and undue political and business influence. The busiest courts in Sofia suffer from serious backlogs, limited resources, and inefficient procedures that hamper the swift and fair administration of justice.

There are three levels of courts. Bulgaria’s 113 regional courts exercise jurisdiction over civil and criminal cases. Above them, 29 district courts (including the Sofia City Court and the Specialized Court for Organized Crime) serve as courts of appellate review for regional court decisions and have trial-level (first-instance) jurisdiction in serious criminal cases and in civil cases where claims exceed BGN 25,000 (USD 13,440), excluding alimony, labor disputes, and financial audit discrepancies, or in property cases where the property’s value exceeds BGN 50,000 (USD 26,880). Six appellate courts review the first-instance decisions of the district courts. The Supreme Court of Cassation is the court of last resort for criminal and civil appeals. There is a separate system of 28 specialized administrative courts which rule on the legality of local and national government decisions, with the Supreme Administrative Court serving as the court of final instance. The Constitutional Court, which is separate from the rest of the judiciary, issues final rulings on the compliance of laws with the Constitution.

Bulgaria has adequate means of enforcing property and contractual rights under local legislation. The government’s handling of investment disputes has been slow, and often requires an intervention at the highest level. There are no outstanding investment disputes before Bulgarian courts involving U.S. companies although several property-related challenges exist against a U.S. investor. Investors sometimes perceive that jurisprudence is inconsistent and that national legislation is used to deter competition from foreign investors.

Laws and Regulations on Foreign Direct Investment

The 2004 Investment Promotion Act stipulates equal treatment of foreign and domestic investors. The law encourages investment in manufacturing and high-technology, as well as in education and human resource development. It creates investment incentives by helping investors purchase land, providing state financing for basic infrastructure and training new staff, and facilitating tax incentives and opportunities for public-private partnerships (PPPs) with the central and local government. PPPs offer an area with potential for private company involvement in supporting and developing public infrastructure and social programs. The most common form of PPPs presently is concessions, which include the lease of government property for private use for up to 35 years.

Foreign investors must comply with the 1991 Commercial Code, which regulates commercial and company law, and the 1951 Law on Obligations and Contracts, which regulates civil transactions.

The 2003 Law on Special Purpose Investment Companies (SPIC) allows for public investment companies in real estate and receivables, essentially real estate investment trusts (REITs). Since a SPIC is considered a pass-through structure for corporate income tax purposes, at least 90 percent of its net income must be distributed to shareholders as taxable dividends. A SPIC must apply for an operational license from the Financial Supervision Commission within six months of registration.

The Invest Bulgaria Agency (IBA), the government’s investment coordinating body, provides information, administrative services, and incentive assessments to prospective foreign investors. Its web site http://www.investbg.government.bg/  contains relevant information for foreign investors.

Competition and Anti-Trust Laws

The Commission for Protection of Competition (the “Commission”) oversees market competition and enforces the Law on the Protection of Competition (the “Competition Law”). The 2008 enacted law is intended to implement EU rules that promote competition and consumer protection. The Competition Law forbids monopolies, restrictive trade practices, abuse of market power, and unfair competition. Companies are prohibited from: direct or indirect abusive pricing practices; distribution of market shares and supply sources; limiting manufacturing development to the detriment of consumers; discriminatory treatment of competing customers; tying contracts to additional and unrelated obligations; and use of economic coercion to cause mergers. Since 2015 the law has prohibited the demonstration of “significant negotiating power” between companies, which is manifested through “…the unreasonable refusal to supply or purchase goods and services, the enforcement of unreasonably heavy or discriminatory conditions or the unreasonable suspension of contractual relations.” The minimum penalty set for noncompliance is BGN 10,000 (USD 5,434), but the fine can amount to up to 10 percent of the annual sales of the respective good. Foreign investors have opposed this provision as increasing government control over their business with local suppliers. In 2017, the Commission over-ruled a proposal to require supermarkets to stock mandatory quotas of Bulgarian-grown or produced food on the grounds that it would contravene EU laws and restrict market choice. The Commission argued that, if adopted, the proposal would increase prices, lower quality, and cause food shortages. The Competition Law prohibits certain forms of unfair competition: damaging competitors’ goodwill; misrepresentation with respect to goods or services; misrepresentation with respect to the origin, manufacturer, or other features of goods or services; use or disclosure of someone else’s trade secrets in violation of good faith commercial practices; and according to Art. 33 in the Competition Law, “unfair solicitation of customers” (i.e., promotion through gifts and lotteries). Monopolies can only be legally established for certain categories of activities: railway and postal services, atomic energy, production of radioactive materials, and weapons production. The Commission defines market concentration of 15 percent or more as potentially damaging to competition. It also defines market concentration of 25 percent or more as potentially damaging to competition if the companies involved are operating in different markets (and are not competitors). In practice, the Competition Law has been inconsistently applied, and the Competition Commission has been subject to influence, or has overstepped its mandate.

Expropriation and Compensation

Private real property rights are legally protected by the Bulgarian Constitution. Only in the case where a public need cannot be met by other means, the Council of Ministers or a regional governor may expropriate land provided that the owner is compensated at fair market value. Expropriation actions of the Council of Ministers can be appealed directly to the Supreme Administrative Court on the legality of the action itself, the property appraisal, or the amount of compensation. A regional governor’s expropriation can be appealed in the appropriate local administrative court. In the Bilateral Investment Treaty (BIT) with the United States, Bulgaria committed to international arbitration in the event of expropriation and other investment disputes.

Dispute Settlement

ICSID Convention and New York Convention

Bulgaria is a signatory to the Convention on the Recognition and Enforcement of Foreign Arbitral Awards (1958 New York convention) and the 1961 European Convention on International Commercial Arbitration. Bulgaria is a member state to the International Centre for the Settlement of Investment Disputes (ICSID).

Investor-State Dispute Settlement

Bulgaria accepts binding international arbitration in disputes with foreign investors. The most experienced arbitration institution in Bulgaria is the Arbitration Court (AC) of the Bulgarian Chamber of Commerce and Industry (BCCI). Established more than 110 years ago, the Arbitration Court hears civil disputes between legal persons, one of whom must be located outside Bulgaria. It began to act as a voluntary arbitration court between natural and/or legal persons domiciled in Bulgaria in 1989.

Arbitration is regulated by the 1988 Law on International Commercial Arbitration, which is based on the United Nations Commission on International Trade Law (UNCITRAL Model Law). According to the Code of Civil Procedure, not all disputes may be resolved through arbitration. Disputes regarding rights over domestic real estate, alimony, or individual labor disputes may only be heard by the courts.

International Commercial Arbitration and Foreign Courts

Arbitral awards, both foreign and domestic, are enforced through the judicial system. The party must petition the Sofia City Court for a writ of execution. Having obtained a writ, however, the creditor then must execute the award using the general framework for execution of judgments in the country. Foreclosure proceedings may also be initiated.

Duration of Dispute Resolution – Local Courts

Bulgarian law instructs courts to act on civil litigation cases within three months after the case is filed. However, in practice, dispute settlement can take several months and up to a few years. Courts in Sofia are typically slower than those outside the capital city and may rule on a case several years after the case has been filed. In courts outside Sofia, it takes anywhere from several months up to a year for a case to be completed. Bankruptcy cases are the most complicated and resolution may take years.

Bankruptcy Regulations

The 1994 Commercial Code Chapter on Bankruptcy provides for reorganization or rehabilitation of a legal entity, maximizes asset recovery, and provides for fair and equal distribution among all creditors. The law applies to all commercial entities, except public monopolies or state-owned enterprises (SOEs) established by a special law. The 2005 Insurance Code regulates insurance company failures while bank failures are regulated under the 2002 Bank Insolvency Act and 2006 Credit Institutions Act. The 2014 bankruptcy of the country’s fourth largest bank, Corporate Commercial bank, was a test case that showed serious deficiencies in ensuring that bank assets are adequately recovered and preserved during bankruptcy proceedings. In 2016, Parliament approved legislative amendments intended to allow bank trustees to better manage assets while at the same time increasing their accountability.

Non-performance of a monetary obligation must be adjudicated before the bankruptcy court can determine whether the debtor is insolvent. There is a presumption of insolvency when the debtor is unable to perform an executable obligation under a commercial transaction or public debt or related commercial activities, has suspended all payments, or is able to pay only the claims of certain creditors. The debtor is deemed over-indebted if its assets are insufficient to cover its short-term monetary obligations.

Bankruptcy proceedings may be initiated on two grounds: the debtor’s insolvency, or the debtor’s excessive indebtedness. Under Part IV of the Commercial Code, debtors or creditors, including state authorities such as the National Revenue Agency, can initiate bankruptcy proceedings. The debtor must declare bankruptcy within 30 days of becoming insolvent or over-indebted. The 2010 amendments to the Commercial Code increased protection for creditors in bankruptcy proceedings by prohibiting a debtor from falsifying the date of insolvency to avoid claims after a certain date. Despite this, cases involving bankruptcy frauds, including through transfer of capital to U.S.-registered shell companies, have increased in recent years. The application for bankruptcy submitted by the debtor is published in the Commercial Register, thus providing all creditors and contractual partners with information about the bankruptcy proceedings. Should any creditor or contractual partner file a request for bankruptcy in court, such a claim is heard in the presence of both the creditor and the debtor.

Once insolvency is determined, the court appoints an interim trustee to represent and manage the company, take inventory of property and assets, identify and convene the creditors, and develop a recovery plan. At the first meeting of the creditors, a trustee is nominated; usually this is just a reaffirmation of the court appointed interim trustee.

Bankruptcy proceedings supersede other court proceedings initiated against the debtor except for labor cases, enforcement proceedings, and cases related to receivables securitized by third parties’ property. Such cases may be initiated even after bankruptcy proceedings begin. Third parties with securities seeking protection against a debtor’s unfair activities may appeal the court decision to initiate a bankruptcy proceeding when securities have been entered in public registers before the date of the claim which started the bankruptcy procedure. Bulgaria dropped one place to a ranking of 38 for “Resolving Insolvency” in the World Bank’s 2015 Doing Business Report (out of 189 surveyed countries).

Creditors must declare to the trustee all debts owed to them within one month of the start of bankruptcy proceedings. The trustee then has seven days to compile a list of debts. A rehabilitation plan must be proposed within one month after publication of the list of debts in the Commercial Register. The 2010 amendments to the Commercial Code limit the application of the rehabilitation plan to debts approved up to the moment of submission of the rehabilitation plan.

After creditors’ approval, the court endorses the rehabilitation plan, terminates the bankruptcy proceeding, and appoints a supervisory body for overseeing the implementation of the rehabilitation plan. The court must endorse the plan within seven days and put it forward to the creditors for approval. The creditors shall convene to discuss the plan within a period of 45 days. The court may renew the bankruptcy proceedings if the debtor does not fulfill its obligations under the rehabilitation plan. The methods of liquidating assets were also revised by the June 2003 legislation to establish a legal framework for selling assets that accounts for the character of bankruptcy proceedings, thus avoiding the need to apply the Civil Procedure Code.

In the World Bank’s 2017 Doing Business Report, Bulgaria declined one spot to 48 for ease of “resolving insolvency.”

Investment Incentives

The 2004 Investment Promotion Act (revised in 2015) is the primary legislation providing investment incentives to investors in Bulgaria and stipulates equal treatment of foreign and domestic investors. The law encourages investment in manufacturing, services, and high-technology, as well as in education and human resource development. It creates investment incentives by helping investors purchase municipal or state owned land without tender, provides state financing for basic infrastructure and for training new staff, as well as reimbursement of employer’s part of social security payments. It also provides tax incentives and opportunities for public-private partnerships with the central and local government and fast-track administrative procedures.

The government policy for investment promotion is not applicable to investments in coal mining, steel production, shipbuilding, synthetic production, transport infrastructure, agriculture, and fisheries. In addition, the Investment Promotion Act gives Class A or Class B status to certain investments in manufacturing and services as well as in high-technology activities and also in regions with an unemployment rate equal to or higher than the country average. The threshold for the certificates may vary between EUR 1 and 5 million (Class A) and EUR 0.5 and 2.5 million (Class B) and depending on the class of certification the investor may receive different administrative and financial incentives.

Additionally, investment projects that are particularly important for the economy and meet the legal requirement for a minimum investment commitment in the amount of EUR 50 million (USD 54 million) and for creating 150 new jobs are classified as priority projects. Such projects can be implemented in all sectors of the economy. In addition to the incentives granted to Class A and B investors, priority investors can acquire limited rights on central or municipal government property at prices below the market ones, receive government grants for research and development (R&D) and education projects, and institutional support for establishing PPPs.

Additional incentives are a two-year valued-added tax (VAT) exemption on equipment imports which applies to investment projects over EUR 2.5 million (USD 2.7 million), provided the project will be implemented within a two-year period and will create at least 20 new jobs. Corporate income tax exemption can also be granted in case of manufacturing projects, which are implemented in high unemployment areas and create at least 10 jobs. The exempted tax amount is to be invested in CAPEX (tangibles and intangibles) within a 4-year period.

Foreign Trade Zones/Free Ports/Trade Facilitation

There are currently four free trade zones in Bulgaria. Located favorably on one of the main highways, the Trakia economic zone just outside Plovdiv has had great success, attracting more than 100 companies to date. The government National Industrial Zones Company has been established to support the creation of such zones and parks and enable a stable FDI inflow. The company presently operates a fully functioning industrial zone in Vidin, which is in the northwest region concentrating the highest level of unemployment in the country. The two other fully functioning industrial zones are those in Ruse and Svilengrad. There are several other zones that are under construction: Bozhurishte (outside Sofia), Burgas, Varna, Karlovo (near Plovdiv), and Telish (near Pleven). The economic zone in Bozhurishte and the industrial park in Burgas are both at an advanced development stage.

Performance and Data Localization Requirements

Bulgaria does not impose export performance or local content requirements as a condition for establishing, maintaining, or expanding an investment. Employment visas and work permits are required for most expatriate personnel from non-EU countries. Permanent residence permits are often difficult to obtain. Many U.S. companies have difficulties obtaining work permits for their non-Bulgarian, non-EU employees. Private companies cannot exceed a 1:10 ratio of non-EU residents to Bulgarian employees.

There are no requirements for foreign IT providers to turn over source code or provide access to surveillance, nor are there mechanisms used to enforce any rules on maintaining a certain amount of data storage within Bulgaria.

Real Property

There are restrictions on non-EU entities owning land, including a recent law that restricts owning agricultural land even by locally registered companies.

In the World Bank’s 2017 Doing Business Report, Bulgaria ranked one place below last year in registering property and issuing construction permits.

Intellectual Property Rights

Bulgarian patent law has been harmonized with EU law for patents and utility patent protection. However, in patent procedures, there are reports of conflicts of interest and delays in decision-making and informing patent holders. These issues, coupled with a lack of accountability of the Bulgarian Patent Office, have weakened patent protection in the country.

Bulgaria joined the Convention on Granting of European Patents (European Patent Convention) in 2002. Bulgaria is a contracting state of the European Patent Office (EPO), whereby a patent recognized by the European Patent Convention must immediately take effect in Bulgaria after validation, which includes a process of translation of the entire patent specification (description and claims) into Bulgarian and payment of a fee (starting from BGN 130 or USD 74.30) within three months of the day the EPO makes a publication of the patent grant.

Bulgaria has also signed the London agreement for facilitating the validation process, which allows rights holders to submit only a translation of the patent claim and not of the whole patent. However, Bulgarian law has still not been amended to correspond to this agreement. Temporary protection of European Patent in Bulgaria may be granted through publications in Bulgaria of the European Patent Applications.

Bulgaria is part of the Patent Cooperation Treaty (PCT). Bulgaria grants the right to exclusive use of inventions for 20 years from the date of patent application, subject to payment of annual fees, which range from BGN 50 (USD 28.60) to BGN 1,700 (USD 970), depending on the time remaining before the patent expires. Supplementary protection certificate (SPC) is also an available protection option. Innovations can also be protected as utility models (small inventions). They are registered without novelty examination. The term of validity of a utility model registration is four years from the date of filing with the Patent Office. It may be extended by two consecutive three-year periods, but the total term of validity may not exceed 10 years. Inventions eligible for patent protection must be new, involve an inventive step, and be capable of industrial application. Article 6 of the Law on Patent and Utility Model Registration lists items not regarded as inventions and Article 7 lists the exceptions to patentability. With regard to utility models, no registration is granted for methods, chemical formulations and their use, and objects in the field of biotechnology. There is no accessible database for the registered and valid patent and utility models in Bulgaria.

Located in the Ministry of Economy, the Patent Office is the competent authority with respect to industrial property rights (including patent matters). The Patent Act describes patent application procedures and the examination process. Patent applications are submitted directly to the Patent Office and recorded in the state register. Compulsory licensing (allowing competitors in the market despite a valid patent) may be ordered under certain conditions: if the patent has not been used within four years of filing the patent application or within three years from the date of issue, if the patent holder is unable to offer justification for not adequately supplying the national market, or in the case of a declaration of national emergency.

Disputes arising from the creation, protection, or use of inventions and utility models can be heard and settled under administrative, civil, or arbitration procedures. Disputes are reviewed by specialized panels convened by the President of the Patent Office and may be appealed to the Sofia Administrative Court within three months of the panel’s decision.

The Customs Office conducts border seizures when there is reason to believe that the goods are infringing either a patent, a supplementary protection certificate (SPC), or a registered utility model. A total of 1,990 border seizures were conducted in 2016, resulting in the detention of 635,176 individual articles. These mainly included clothes and clothing accessories, perfumes, cosmetics and other body care articles, handbags, wallets, purses, toys, shoes, watches, mobile phones, etc. Ninety-five percent of all 1,990 detentions were made after the respective right holders had alerted the customs police. In 2016, over 60 percent of all detained articles (392,565) were destroyed following the standard procedure that includes taking the consent of the rightholder and owner of the detained goods only, without a need to prove actual infringement).

The regime is in compliance with Regulation 608/2013/EC. Pursuant to the 1996 Protection of New Plant Varieties and Animal Breeds Act, the Patent Office can issue a certificate which protects new plant varieties and animal breeds for between 25 and 30 years.

Responding to long-standing industry concerns, the Bulgarian government included a provision to provide data exclusivity (i.e., protection of confidential data submitted to the government to obtain approval for market pharmaceutical products) in its Drug Law. Bulgaria grants supplemental protection certificates for pharmaceutical products and plant protection products under EU regulations. This protection is similar to that provided in the United States.

In 1998, Parliament ratified the 1991 International Convention for the Protection of New Varieties of Plants. In addition, all new types of plants registered by the EU’s Community Plant Variety Office are considered effective in Bulgaria. In 1999, Parliament passed a series of laws on trademarks and geographical indications, industrial designs, and integrated circuits in accordance with TRIPs (WTO’s Trade Related Aspects of Intellectual Property) requirements and the EU Association Agreement.

The Trademarks and Geographical Indications Act (TGIA), as amended in 2005 and 2006 to comply with EU standards, regulates the establishment, use, suspension, renewal, and protection of trademarks, collective and certificate marks, and geographic indications. The right for marks (trademarks, service marks, and collective and certificate marks) is acquired through registration and is valid from the date of filing the application. The right of registration belongs to the first applicant. Co-ownership of marks is allowed. With amendments to the TGIA that entered into force in March 2011, all applications that comply with the basic requirements of the law are published. Interested parties then have three months from the date the application is published in the national gazette to file an opposition. Bulgaria is a member of the Lisbon Agreement for the Protection of Appellations of Origin and their International Registration. Right of priority with respect to trademarks that do not differ substantially is given to the application that was filed in compliance with Article 32 of the TGIA. Right of priority is also established on the basis of a request made in one of the member countries of the Paris Convention for the Protection of Industrial Property or of the WTO. To exercise the right of priority, the applicant must file a request within six months of the date the other party files.

A trademark is normally granted within 18 months of filing a complete application. Refusals can be appealed to the Disputes Department of the Patent Office. Decisions of this department can be appealed to the Sofia Administrative Court within three months of the decision. The right of exclusive use of a trademark is granted for 10 years from the date of submitting the application. Extension requests must be filed during the final year of validity and can be renewed up to six months after its expiration. Protection may be terminated at third party request if a trademark is not used for a five-year period. Bulgarian legislation provides for criminal, civil, and administrative remedies against trademark violation. Civil legal infringement actions may be conducted, including seizure and destruction of the infringing products and compensation for damages.

The claimant may request compensation ranging from BGN 500 to BGN 100,000 (USD 287 and USD 57,100). In addition, the claimant may request possession of the infringing articles and compensation for expenses incurred in destroying the articles. All civil actions are heard by Sofia City Court. Bulgaria has implemented simplified border control procedure for the destruction of seized fake goods without civil or criminal trial. The TGIA imposes a fine of BGN 500 (USD 287) to BGN 1,500 (USD 860) on any physical person who is selling goods or services that bear a sign that is identical or similar to a registered mark without the proprietor’s consent. Legal entities are fined between BGN 1,000 (USD 574) and BGN 3,000 (USD 1,720). The fine for repeated offenses is between BGN 1,500 (USD 860) and BGN 3,000 (USD 1,720) for physical persons and between BGN 3,000 (USD 1,720) and BGN 5,000 (USD 2,870) for legal entities. The Criminal Code prohibits use of a third person’s trademark without the proprietor’s consent, punishable by imprisonment of up to five years and a fine of up to BGN 5,000 (USD 2,870). If the act is repeated or significant damages result, the punishment can be extended up to eight years of imprisonment and a fine between BGN 5,000 (USD 2,870) to BGN 8,000 (USD 4,600). In practice criminal court rulings are rare and sentencing is lenient.

In Bulgaria, trademarks, service-marks, and rights to geographic indications are only protected pursuant to registration with the Bulgarian Patent Office or an international registration (under the Madrid Agreement and the Madrid protocol) designating Bulgaria; they do not arise simply with use in commerce of the mark or indication. Bad faith registrations of well-known international trademarks are increasingly common in Bulgaria. In the past year, there have been at least two cases in which the Bulgarian Patent Office has upheld the rights of the bad-faith registrants with enforcement procedures against original U.S. trademark holders. Legal entities cannot be held liable under the Criminal Code. Criminal penalties for copyright infringement and willful trademark infringement are limited compared to enforcement mechanisms available under U.S. law. Under Bulgarian law, industrial designs that are new and original can be granted certificates from the Patent Office and entered in the state register. The term of protection is 10 years, renewable for up to 25 years. Bulgaria is a contracting state of The Hague Agreement Concerning the International Deposit of Industrial Designs. With respect to third parties, an international registration shall have effect in Bulgaria as of the date of expiration of the six-month period under Article 8 (1) of the Hague Agreement. Enforcement of industrial design is similar to trademarks enforcement. There is no clear protection and enforceable legislation for trade secrets and trade dress.

Bulgaria remained for a third consecutive year on the USTR’s 2016 Watch List as a country not doing enough to enforce IP laws. The 1993 Copyright Act defines copyright work as any work of literature, art and science which is the result of creative activity, including: literary works, publications and computer programs; musical works; stage productions; films and other audiovisual works; fine arts, including applied art, design and folk artistic crafts; architectural works and spatial development plans; photographic works and works created in a manner similar to the photographic. Under the Bulgarian law, translations and reprocessing of existing works and folklore works, periodicals, encyclopedias, collections, anthologies, bibliographies, databases, which include two or more works or materials, are also copyright protected. The law establishes a possibility for rights holders to form organizations for collective management of rights in order to ensure they receive adequate payment for using their works by other users. Parliament failed to agree on a new Collective Rights Management Act in 2016 and is going to include the texts in an amended Copyright Act later in 2017.

For additional information about national laws and points of contact at local IP offices, please see WIPO’s country profiles at http://www.wipo.int/directory/en/ .

Capital Markets and Portfolio Investment

Since 1997, the Bulgarian Stock Exchange (BSE) has operated under a license from the Securities and Stock Exchange Commission (SSEC). The 1999 Law on Public Offering of Securities regulates the issuance of securities, securities transactions, stock exchanges, and investment intermediaries. The 2002 comprehensive amendments to this law established significant rights for minority shareholders of publicly-owned companies in Bulgaria. In addition, they created an important foundation for the adoption of international best practices for corporate governance principles in public companies. In March 2015, the Supreme Administrative Court upheld a 2014 decision against existing texts in the Law on Public Offering of Securities, which requires that any new majority shareholder in a public company make a buyout offer to the minority shareholders. This court decision created legal uncertainty and an obstacle to many minority investors’ sales of stock to the majority investor. The financial supervision authorities published in March 2017draft changes to the law, cutting administrative procedures, improving bondholder protection and making dividends payable twice a year (versus once a year at present).

Since 2007, Bulgaria has aligned its regulation of securities markets to EU standards under the Markets in Financial Instruments Directive (MiFID) that seeks to integrate trading, clearing, settlement and depository functions of the EU securities markets. The BSE is the only trading venue in Bulgaria. Its infrastructure has substantially improved in recent years, including the establishment of an official index (SOFIX), an Internet-based trading system, and a growing number of brokers. Investors access the BSE to trade corporate stock, government bonds, corporate bonds, Bulgarian Depositary Receipts, municipal bonds, and mortgage-backed bonds. The stock exchange operates three other indices in addition to the official SOFIX: BG40, BG TR30, and BGREIT. Capital gains from securities transactions are not subject to withholding tax and tax on dividends and liquidation proceeds is five percent. The small domestic market is served by a large number of domestic investment firms. Private sector companies continue to prefer traditional banks in order to finance their business plans, instead of tapping into the capital market. BSE remains insufficiently capitalized as a result. The total market capitalization increased by 12 percent compared to 2015, to BGN 9.7 billion (USD 5.2 billion), or 11 percent of GDP. The Ministry of Finance, which is the BSE’s majority owner (50.06 percent), has continued to seek an internationally recognized investor in BSE in 2016. The remaining BSE capital is allocated among investment intermediaries and commercial banks (20.40 percent), and other local and foreign legal entities (19.51), natural persons and institutional investors (10.03).

Money and Banking System

Since 1997, Bulgaria has been operating a currency board regime that pegs the local currency to the Euro and does not allow the central bank to refinance domestic banks under almost any circumstance. In 2016, there were 27 commercial banks (22 subsidiaries and 5 branches), with total assets of BGN 92.1 billion (USD 49.5 billion). Approximately 56 percent of bank assets are concentrated in the top five banks: UniCredit-Bulbank, DSK Bank, First Investment Bank, United Bulgarian Bank and Eurobank (Postbank). Bulgarian banks’ liquidity coefficient was 38.34 percent in December 2016, and the ratio of non-performing to the overall loans was 8.4 percent December 2016.

In 2003, Bulgaria completed the privatization of its state-owned banks, attracting many foreign banks as strategic investors. Foreign investors drawn to the Bulgarian banking industry including UniCredito Italiano SpA (UCI), BNP PARIBAS, KBC, Societe Generale, Raiffeisen International, OTP Group, and Citibank. In 2016, Belgian KBC and its Bulgarian affiliation, CIBank, acquired the Bulgaria affiliate of the National Bank of Greece, United Bulgarian Bank. Approximately 73 percent of the banking system is owned by foreign banking groups, both EU and non-EU.

The Bulgarian government finances some of its expenditures by issuing bonds in capital markets. Commercial banks and private pension funds are the primary purchasers of these instruments. EU-based banks are eligible to be primary dealers of Bulgarian government bonds. In order to acquire Bulgarian government bonds, a foreign bank must register with the Ministry of Finance and open a “custody account” in Bulgarian leva. The Investment Promotion Act defines securities, including treasury bills, with maturities over six months as investments. Repatriation of profits is possible after presenting documentation that taxes have been paid.

Confidence in the Bulgarian banking system was badly shaken when the fourth largest bank, Corporate Commercial Bank (CCB), collapsed in 2014. While the bank is currently in liquidation proceedings, the government has investigated alleged leakage of assets through companies connected with the bank’s former owner. In December 2014, the government infused the deposit insurance fund with BGN 2 billion (USD 1.1 billion) to repay CCB depositors their guaranteed deposits up to EUR 100,000 (USD 107,000).

Partly as a result of this collapse, the Bulgarian National Bank conducted an Asset Quality Review and a stress test in 2016 that showed most Bulgarian banks were well capitalized, but at the same time, recommended that two banks increase their capitalization rates.

Foreign Exchange and Remittances

Foreign Exchange

Foreign exchange is freely accessible. The 2011 amendments of the 1999 Foreign Currency Act stipulate that anyone may import or export up to EUR 10,000 (USD 11,000) or its foreign exchange equivalent without filling out a customs declaration. The import or export of over EUR 10,000 or its equivalent in Bulgarian leva or another currency across the border to or from a third country must be declared to the customs authorities. The import or export of over EUR 10,000 or its equivalent in Bulgarian leva or another currency across the border to or from an EU member state must be declared if requested by the customs authorities. Exporting over BGN 30,000 (USD 16,130) in cash requires a declaration about the source of the funds, supported by documents certifying that the exporter does not owe taxes. No tax certificate is required for foreigners exporting the cash equivalent of BGN 30,000 or greater provided the amount is equal to or less than the amount declared when imported.

Bulgarian law requires all international payments over BGN 30,000 to be executed via bank transfer with supporting documentation detailing the purpose of the transaction. Payments made in Bulgaria are required to be conducted through transfer or deposit in a payment account, when they are equal to or exceeding BGN 10,000, or their foreign currency equivalent. The central bank and commercial banks record every international transaction that is equal to or more than BGN 100,000 (USD 54,300).

Bulgaria operates a Currency Board Arrangement (CBA) whereby the lev (BGN) is fixed to Euro, exchanging EUR 1 for BGN 1.9558. In 2014, United States and Bulgaria signed an intergovernmental agreement that implements provisions of the Foreign Account Tax Compliant Act (FATCA), which targets tax non-compliance by U.S. persons who do business with Bulgarian financial institutions. The Parliament ratified the agreement in 2015.

Remittance Policies

There is no official policy regarding remittances. Remittances as personal transfers have become an increasingly important source of financing for Bulgarian families with relatives overseas. Foreign remittances, defined as all personal transfers between resident and nonresident individuals amounted to EUR 848 million (USD 901.4 million) in 2016. Payment records count only remittances registered through official channels (bank transfers or other licensed institutions) and do not include other payments made through less formal channels.

Sovereign Wealth Funds

Bulgaria does not have a sovereign wealth fund.

Upon EU accession, Bulgaria was recognized as a fully operating market economy, in which the majority of the companies are private. The State’s monopoly in railway infrastructure is among the few exceptions. The government postal service still holds a partial market monopoly, but is gradually opening to include a number of privately managed courier companies. Though Bulgaria has separate State-owned enterprises (SOEs) for infrastructure ownership and distribution in both the electricity and gas markets, all of these companies are owned by the same holding company. While the government has gradually reduced its subsidization of SOEs, it used debt financing to pay for the accumulated arrears in the indebted energy sector. SOE budgets are made public with the budget proposals and, during budget implementation process, with enacted budgets of the respective ministry. The Ministry of Finance posts quarterly financial reports for many SOEs on its website. SOEs’ finances are audited once a year, and the audit reports are posted on the Ministry of Finance website. The list of all SOEs can be found on: http://www.minfin.bg/bg/page/948 .

SOEs are defined as limited liability or joint stock companies solely owned by the state. SOEs can enter into partnerships by selling stakes to other non-state companies. The government treats equally public and private sector companies during public bidding, or other government-controlled processes. SOEs are subject to the same tax regime and government policies as private sector companies. Bulgaria became party to WTO’s Government Procurement Agreement (GPA) upon its entry into the EU in 2007. A substantial number of the SOEs are covered by this agreement.

Privatization Program

Bulgaria completed its major privatizations in the 1990s and early 2000s. All state-owned properties are eligible for privatization, with the exception of a specific list of companies including water management companies, state hospitals, and state sports facilities. State-owned military manufacturers can be privatized after approval by Parliament. Municipally-owned property is considered for privatization upon decision by a municipal council, or authorized body and upon publication of the municipal privatization list in the State Gazette. Privatization methods include: public auctions, public tenders, and public offerings. Foreign companies, including state-owned ones, may purchase Bulgarian state-owned firms. The 2010 Privatization and Post-Privatization Act created a single Privatization and Post-Privatization Agency which makes privatization decisions regarding: hospitals; equity and shares in companies 50 percent or more owned by the state; state-owned property valued at between BGN 10,000 (USD 5,434) and BGN 500,000 (USD 271,700), following approval from the Minister of Regional Development and Public Works and the Minister of Finance; and state-owned property valued at over BGN 500,000 (USD 271,700), following approval from the Council of Ministers.

The Privatization and Post-Privatization Agency also oversees the implementation of privatization contracts and ensures that non-price privatization commitments (employee retention, technology transfer, environmental liability, and investment) in the privatization selection criteria are honored. In 2016, the agency concentrated efforts again on the sale of the freight division of the Bulgarian Railways company (BDZ) and of nearly 20 percent of government stake in the free trade zone in Burgas. In 2016, the government retendered the bid for 35-year concession of the Sofia airport, the nation’s largest passenger terminal, and for the airport in the second largest city of Plovdiv. In 2016, the Bulgarian President vetoed the new Concession Act that extended the maximum concession period to over 35 years, granted Parliament approval, and introduced a new type of concession category – concession for use – in addition to the other two existing categories for construction and services.

The number of mergers and acquisitions in Bulgaria increased by six percent in 2016, to a total of 18, amounting to EUR 928 Million. Most activities involved corporate foreign investment particularly in technology, consumer goods, IT outsourcing and healthcare. The acquisitions of Tokuda Hospital Group and City Clinic Group by Turkish group Acibadem and of the bottled water company Devin by the Belgian Spadel Group were the two largest transactions in 2016.

Foreign and Bulgarian firms are taking steps to increase corporate social responsibility activities in their core business practices. In 2016, Coca Cola won an award for an initiative called “Together for a better education in Bulgaria” presented by the Bulgarian Business Leaders Forum. The Leaders Forum also recognized Avon for its campaign against breast cancer. In the Bulgarian region of Stara Zagora, AES and the Galabovo Municipality inaugurated the country’s most modern youth center. The project, valued at more than 2 million Euros, was fully financed by AES. The Bulgarian Network for Corporate Social Responsibility has been established to support the companies wishing to develop a CSR program. Bulgaria is not a member of the Extractive Industries Transparency Initiative.

Widespread corruption continues to be one of the most difficult problems in Bulgaria’s investment climate. Human trafficking, narcotics, and contraband smuggling channels contribute to corruption in Bulgaria. Bulgaria has laws, regulations, and penalties on the books to combat corruption, but its law enforcement capacity remains limited and the authorities opt for easy-to-prove, low-level cases. As a result, Bulgaria has seen little progress on cases of high public interest, involving alleged siphoning of millions from the state coffers or EU funds, and in particular those involving public tenders for large energy and infrastructure projects. The State Agency for National Security (DANS), the Ministry of Interior, and the independent Prosecution service are the primary institutions responsible for combating corruption. In 2015, the three agencies signed an agreement to launch a joint task-force to target high-level public and judicial corruption.

Bribery is a criminal act under Bulgarian law for both the giver and the receiver. Individuals who mediate and facilitate a bribe are also held accountable. Penalties range from one to 15 years imprisonment along with possible confiscation of property depending on the circumstances and seriousness of the case. In the most egregious cases, the Penal Code calls for prison terms of 10 to 30 years. Bribing a foreign official is also a criminal act. The government does not require companies to establish internal codes of conduct or compliance programs to detect and prevent bribery. Bulgaria ranks 75th out of 176 countries in Transparency International’s Corruption Perception Index for 2016.

UN Anticorruption Convention, OECD Convention on Combatting Bribery

In 1998, Bulgaria was one of the first non-OECD nations to ratify the Anti-Bribery Convention and is a participating member of the OECD Working Group on Bribery. Bulgaria has also ratified the Council of Europe’s Convention on Laundering, Search, Seizure, and Confiscation of Proceeds of Crime (1994) and Civil Convention on Corruption (1999). Bulgaria has signed and ratified the UN Convention against Corruption (2003); the Additional Protocol to the Council of Europe’s Criminal Law Convention on Corruption; and the UN Convention against Transnational Organized Crime.

Resources to Report Corruption

Organizations or agencies responsible for reporting on or combating corruption:

Center for Prevention and Countering Corruption and Organized Crime
6 Sveta Nedelya Sq., Sofia
cppkop@borkor.bg

Transparency International Bulgaria
50 Shandor Petyofi Str.
mbox@transparency.bg

There have been no incidents in recent years involving politically-motivated crime.

As of December 2016, Bulgaria’s potential workforce officially consisted of 3,220,800 men and women, or 44.7 percent of the population. Of this, the number of employed men and women 15 years and older totaled 3.0 million people, of which men were 53.6 percent and women 46.4 percent.

The number of officially registered unemployed was 7.6 percent of the labor force in December 2016. Unemployment of those between 15 and 24 years of age was 17.6 percent as of December 2016. Unemployment is higher in the northwest of the country than elsewhere, and the government has tackled it with measures to stimulate business and alternative employment.

The official adult literacy rate in Bulgaria is 98.3 percent (15 years and older), but illiteracy is much higher among some minorities. A high percentage of the workforce has completed some form of secondary, technical, or vocational education. Many Bulgarians have strong backgrounds in engineering, medicine, economics, and the sciences, but there is a shortage of professionals with professional management skills as well as of highly-skilled manual laborers. The aptitude of workers, the relatively high number of those who speak English, and the relatively low cost of labor are considerable incentives for foreign companies, especially those that are labor-intensive, to invest in Bulgaria.

In recent years, many foreign investors have complained of the deteriorating quality of Bulgarian university education and the fact that it is training graduates in specialties that are not in line with market needs. In an attempt to reverse that trend, the Bulgarian government has introduced a vocational training track for some Bulgarian high school students. Under this program, certain students will receive professional qualification while at school but forego some of the humanities and social science prerequisites for a regular university education after graduation. The government has encouraged universities to increase admission for specialties most attractive for local business, at the cost of other, less attractive university specialties.

Another concern frequently raised by investors is the difficulty in finding appropriately skilled local laborers, because many well-trained Bulgarians, enabled by the generally unrestricted access to EU labor market, still choose to leave the country in pursuit of better paying jobs. Many hospital nurses have left the country in the recent years, and the growing deficit of school teachers prompted the government to increase teacher salaries in 2016. The development of Bulgaria’s digital technologies sector has provided opportunities for many local IT specialists to work for large IT corporations in Bulgaria. Outsourcing services have become particularly attractive for international companies that have started to employ skilled young Bulgarians.

The Bulgarian Constitution recognizes workers’ rights to join trade unions and to organize. The National Council for Tripartite Cooperation (NCTC) provides a forum for dialogue among government, employer organizations, and trade unions on issues such as cost-of-living adjustments. An established practice of negotiating the so-called “social security thresholds” between trade unions and employers organizations each year helps determine the formula for calculating the relative amount of employer and employee social security contributions. Bulgaria has two large trade union confederations represented at the national level, the Confederation of Independent Trade Unions of Bulgaria (CITUB) and the Confederation of Labor Podkrepa (Support). As of 2015, estimated trade union membership was 275,762 for CITUB, and 80,000 for Podkrepa.

There are very few restrictions on trade union activity, but employees in smaller private firms are often not represented. In addition, there are four nationally recognized employer organizations currently in Bulgaria that target different industry and company membership. Under the Bulgarian Labor Code, employer-employee relations are regulated by employment contracts. The framework of the employment contracts can be shaped through collective bargaining. Collective labor contracts can be concluded at the sectoral level, enterprise level, and municipal level. The Labor Code addresses worker occupational safety and health issues, mandates a minimum wage (determined by the Council of Ministers), and prevents exploitation of workers, including child labor. It clearly delineates employer rights. Disputes between labor and management can be referred to the courts, but resolution is often subject to delays. Neither foreign companies nor majority foreign-owned Bulgarian companies are exempt from the requirements of the Labor Code. Over the last ten years, the government has attempted to address labor market rigidities through amendments to the Labor Code that related to flexible working time, one-day labor contracts for seasonal workers, more part-time and overtime opportunities and bring labor legislation into compliance with EU requirements. In 2008, the Parliament passed changes in the labor legislation to increase fines to BGN 15,000 (USD 8,110) for Labor Code violations. The minimum annual paid leave is 20 days. The minimum wage in 2016 is BGN 460 (USD 248) per month. In 2012, rules regulating the status of temporary workers and temporary employment agencies were introduced.

The National Institute for Conciliation and Arbitration (NICA) developed a framework for collective labor dispute mediation and arbitration. NICA includes representatives from labor, employers, and government. NICA-sponsored collective labor dispute resolutions are still few in number. Several of the appointed mediators received basic mediation skills training from the U.S. Federal Mediation and Conciliation Service. There are 36 appointed mediators and 36 arbiters, proposed by social partners and approved by NICA’s Supervisory Board.

In 1991, the Overseas Private Investment Corporation (OPIC) and the Bulgarian government signed an Investment Incentive Agreement, which governs OPIC’s operations in Bulgaria. OPIC provides medium- to long-term funding through direct loans and loan guarantees to eligible investment projects in developing countries and emerging markets. OPIC also supports a number of privately owned and managed equity funds, including a regional fund for Southeast Europe created in 2005 for investments in companies in Bulgaria and other Balkan countries. OPIC’s Small- and Medium-Size Financing is available for businesses with annual revenues under USD 250 million. OPIC’s structured financing focuses on U.S. businesses with annual revenue over USD 250 million and supports large capital-intensive projects such as infrastructure, telecommunications, power, water, housing, airports, technology, and financial services. OPIC offers U.S. investors a series of services, insurance against currency inconvertibility, expropriation, and political violence. Political risk insurance is also available from the Multilateral Investment Guarantee Agency (MIGA), which is a World Bank affiliate, as well as from a number of private U.S. companies. Bulgaria is a signatory to the Convention Establishing the Multilateral Investment Guarantee Agency. Since 2011, OPIC has funded three projects in Bulgaria: for solar energy, for small business development, and for education.

*Local source: Bulgarian National Bank, US dollar conversion at official 2015 yearend exchange rate (1.79 BGN for 1 USD)

USFDI data for Bulgaria from the official InvestBulgaria Agency are taken only for the period 2010-2015. Total USFDI in Bulgaria unofficially amount to over USD 1 Billion.
Table 3: Sources and Destination of FDI

Table 4: Sources of Portfolio Investment

Tonya Hancock
Economic Officer
16 Kozyak Str., 1408 Sofia
+359-2-937-5218
HancockTJ@state.gov