A Public Listed Company in Bulgaria is a Joint Stock Company (AD) which is initially entered in the Trade Register to the Entry Agency, later on in the Register of Public Companies, and supervised by the Financial Supervision Commission (FSC).
Even though the procedure of setting up a new entity in Bulgaria is fast and well organized, the listing process is time consuming, complex and difficult. The application for listing must go through the approval of a prospectus for a public offering from the FSC.
The FSC’s common practice stipulates that for a public company to be eligible for listing, it must have 2-3 years of business operations prior its application to the FSC. The financial history of the company, combined with the fact that it already has an established line of operations, are the two main reasons behind the FSC’s requirement. However, there is no legal provision for this requirement under the Bulgarian law and it is just a matter of practice. Therefore, newly incorporated companies can be registered as public listed companies as well.
The FSC requires a business plan to be included in the listing prospectus in order to accept a listing application. This requirement is applicable even for newly incorporated companies. The latter should appoint an auditor approved and elected by the general assembly who will prepare the financial statements covering the period between the incorporation date of the company and the submission of the listing application.
The founders of the public listed company may be physical or legal persons of any nationality and its Board of Directors must consist of at least 3 and not more than 9 persons. Its shares are traded on the Bulgarian Stock Exchange and are always dematerialized, registered and managed by the Central Depository. The minimum capital of a public listed company in Bulgaria is 50.000 BGN (approximately 25,800eur) and, according to the law, it ceases to be public, if the value of its assets, including the share capital, falls below 500000 BGN (approximately 258,000eur) according to the last month’s balance sheet, as well as according to the last two signed annual financial statements.
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