The Bulgarian LLC-Investment Route to EU Citizenship in Five Years

 

 

In 2013, several investment structures were introduced in Bulgarian nationality law. These allow an investor to obtain permanent residence and, subsequently, to apply for Bulgarian citizenship in a privileged manner.

In addition to the widely favoured government bond option, a less-known route to citizenship via the same legal framework is possible through the investment of approximately EUR 257,000 in a Bulgarian company. This option, which may also be organised as a relatively low-risk way of becoming an EU citizen, offers investors a potentially greater upside and return on capital than the conventional route.

How viable is this route and how does it compare to similarly priced routes to EU citizenship?

What types of LLC-investment qualify?
The qualifications on such an investor are that they are a foreign national, who:

1. has contributed to the capital of a Bulgarian company by investing the amount of EUR 257,000;
2. is a shareholder with no less than a 50% share of the capital.

Furthermore, it must be demonstrated that, as a result of the investment, the company:

1. has acquired new long-term tangible and intangible assets of at least EUR 257,000;
2. has created 10 jobs for Bulgarian citizens, and these have to be maintained for the residence permit to remain valid.

The investment is certified as qualifying by the Ministry of Economy (MoE) 30 days upon submitting the application. The required documents vary depending on the exact structure of the investment but the following are required in principle:

1. A document certifying the value and type of the investment (generally in an approved by the MoE form. This must report the expenses for the acquisition of new long term tangible and intangible assets after the payment into capital, certified by an auditor);
2. A document certifying the employment of 10 Bulgarian citizens;
3. Declaration for source(s) of funds;
4. A photocopy of the applicant’s passport;
5. A CV of the applicant.

There is no charge associated with the procedure. 

The pros and cons of the LLC-investment route
One clear advantage of this option is that the investor can choose freely the type of project and business that best suits them, as long as the business investment meets the above-outlined requirements. A limited liability company with a single shareholder may be registered in a week so that, once the applicant has selected the right business, making the qualifying investment can happen rapidly.

Because the selection of assets is entirely at the discretion of the investor (provided they satisfy the criterion of being long-term), this investment option is generally considered low-risk as, or at least as low-risk as the investor prefers.

Following five years of holding a permanent residence permit, the investor would qualify for citizenship.

The Bulgarian LLC-route is one of the options with the lowest threshold of investment that still leads to EU citizenship. Bulgaria, Portugal, and Latvia are the only residence by investment programs within the EU that offer a viable route to citizenship in six years or fewer at a capital requirement below half a million euros.

Golden visa investors who would obtain citizenship in Latvia, though, must physically reside in the country for at least four out of the five last years and must also pass a language test.

Portugal’s golden visa can lead to citizenship in that country in about six years, but requires a minimum outlay of EUR 350,000, either in investment funds or real estate slated for renovation, an investment nearly EUR 100,000 above Bulgaria and one that significantly limits the applicant’s choice of asset class compared to Bulgaria.

This provision in the Bulgarian Citizenship Act determining the eligibility of investors to qualify for Bulgarian citizenship under the privileged programme does not expressly include family members, but under the Bulgarian Citizenship Act a child of a Bulgarian citizen is eligible to apply for citizenship and generally spouses of Bulgarian citizens are eligible to apply provided that certain requirements are met.