Company with Variable Capital (VCC) in BULGARIA
Variable Capital Company (VCC), the new *****STARS legal form, innovative & advantageous
The company with variable capital (VCC) is a new type of commercial company, introduced in the Commercial Act in 2023 (SG, issue 66 of 2023). The real possibility of registration in the Commercial Register has existed since December 15, 2024, when the Registry Agency ensured the technical readiness to accept applications.
VCC is the sixth type of commercial company in Bulgaria – a hybrid between an OOD and an AD, which combines the advantages of both forms. Its main feature is that the capital is a variable value and is not entered in the Commercial Register. This means that changes in the capital (upon entry or exit of partners) do not require entry and do not give rise to administrative fees.
The company can issue different classes of shares – ordinary and preferred – which makes it particularly suitable for attracting investors. Shares are transferred in simple written form (without notarization), and information about the partners is kept in a Partners’ Book, which is an internal document and not public.
Variable Capital Company (VCC), main features and advantages
Flexible capital: There is no minimum capital that is difficult to enter or change, which is easier than an LLC.
Easy entry/exit of investors: The procedures are simplified, suitable for venture capital.
Share classes: Possibility of different rights (vote, dividend) for different share classes.
Requirements: Suitable for companies with up to 50 staff and up to 2 million EUR turnover/assets.
Management: Less administrative burden, possibility of fully online management.
Suitable for: Startups and high-tech enterprises seeking investments.
Comparison: Combines the liability of an LLC with the flexibility of a joint-stock company, without complicated notarial certifications when transferring shares.
Variable Capital Company (VCC), incorporation
A variable capital company can be established by one or more individuals and/or legal entities. This type of commercial company is new to Bulgarian business and was introduced with the latest amendments to the Commercial Act with issue 66/01.08.2023 of the State Gazette. It is particularly suitable for startup companies that develop innovative and high-tech products and services.
Unlike OOD and AD, with a variable capital company:
It is NOT required to open a savings account for the capital;
The capital is NOT entered in the commercial register;
There is NO requirement for a minimum amount of capital;
The partners are NOT entered in the commercial register;
Non-cash contributions to the capital are made faster and easier.
..………. another advantages:
Flexibility: The capital can vary according to investments, without complicated increase/decrease procedures. Requirements: Staff < 50 people and annual turnover/assets ≤ 2 million EUR.
Establishment: Can be established with a capital of 1 eurocent by one or more persons.
Ownership: Allows the issuance of different classes of shares and easy structuring of shares for employees (vesting).
Management: Simpler compared to Joint Stock Companies (JSC), without a mandatory two-tier board. A VCC is an ideal solution for start-up companies seeking external financing (venture capital) and dynamic development, combining the flexibility of an OOD with some advantages of an AD.
No savings account: No bank account is required to deposit the capital, which eliminates bank fees and delays.
The capital is not registered: The amount of the capital is not subject to registration in the Commercial Register.
Capital establishment: The capital is established once a year by a decision of the General Meeting upon adoption of the annual financial statement.
Minimum capital: A VCC can be established with a minimum capital of 0.01 EUR.
Contributions: The capital upon establishment can be paid at the cash desk (in cash), and not necessarily by bank transfer
A VCC is an ideal solution for start-up companies seeking external financing (venture capital) and dynamic development, combining the flexibility of an OOD with some advantages of an AD.
.…..in conclusion, main features and advantages:
Flexible capital: There is no minimum capital that is difficult to enter or change, which is easier than an LLC.
Easy entry/exit of investors: The procedures are simplified, suitable for venture capital.
Share classes: Possibility of different rights (vote, dividend) for different share classes.
Requirements: Suitable for companies with up to 50 staff and up to 2 million EUR turnover/assets.
Management: Less administrative burden, possibility of fully online management.
Suitable for: Startups and high-tech enterprises seeking investments.
Comparison: Combines the liability of an LLC with the flexibility of a joint-stock company, without complicated notarial certifications when transferring shares.
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