Bulgaria free zones

Bulgaria free zones

Bulgaria has several special economic zones, each of which offer the benefit of multiple investment incentives. The Bulgarian authorities distinguish two types of special economic zones: i) free economic zones and ii) industrial zones.

The Bulgarian free economic zones

Register free zone company in Bulgaria

  1. The Bulgarian free economic zones (FEZ) are sizeable industrialized estates with high-quality infrastructure to support commercial and logistics facilities to foreign investors. FEZs are an ideal location for manufacturing and trading companies exporting their products to the EU, thanks to i) their convenient location close to transport hubs ii) low cost warehousing space and iii) competitive investment incentives compared to neighboring EU countries;
  2. The Bulgarian authorities currently utilize 6 free economic zones: i) Rousse FEZ which is the largest and most developed; ii) Vidin FEZ; iii) Plovdiv FEZ; iv) Bourgas FEZ; v) Svilengrad FEZ and vi) Dragoman FEZ;
  3. These free zones offers advantages including i) no import/export customs duties; ii) no VAT on exports produced within the zones; iii) and simplified customs procedures. The Rousse FEZ additionally offers i) cheaper land leases; ii) 24-hour live security surveillance and iii) staff project subsidies;
  4. In order to conduct operations in a Free Trade Zone, a company must obtain approval from the Free Zone Authority. Healy Consultants will be happy to assist our Clients interested in operating in an FEZ to i) evaluate the eligibility of their project ii) draft a detailed business plan fulfilling registration requirements and iii) register their company directly with the relevant government entity.

The Bulgarian industrial zones

  1. The Bulgarian government currently operates 5 industrial zones to promote manufacturing, including: i) Maritsa Industrial and Commercial Zone, ii) Rakovski Industrial Zone; iii) Kuklen Industrial and Commercial Zone; iv) Parvomai Industrial Zone and v) Letnitsa Industrial Park;
  2. These industrial zones provide the advantages to business including i) 100% corporate tax exemption; ii) rapid business setup implementation terms; iii) reduced land leases in co-operation with a bank; iv) excellent logistics and infrastructure support and v) cheap railway services;
  3. Foreign investors wishing to conduct business within one of the industrial zones must obtain approval from the Bulgarian Trade Register. Healy Consultants will be happy to assist our Clients to i) evaluate the eligibility of their project ii) draft a detailed business plan fulfilling registration requirements and iii) submit an application to the respective Government Authority.

Table of comparison between Bulgarian free zones

Bulgaria Free Trade ZonesRousse FEZOther Bulgaria FEZsBulgaria Industrial zones
Summary
How long to set the company up?3 weeks3 weeks2 weeks
How long to setup the bank account?3 weeks3 weeks3 weeks
Can the company be wholly foreign owned?YesYesYes
Client must travel to the zone?NoNoNo
Most popular business sector?ManufacturingManufacturing and logisticsManufacturing
Minimum share capital requirement?€25,000€25,000€25,000
Bonded warehouses available?YesYesYes
Agent required to conduct business outside of FEZs?YesYesYes
Can hire foreign workers?YesYesYes
Any restrictions on money remittance?NoNoNo
Time zone? (ahead of GMT)GMT+2hrsGMT+2hrsGMT+2hrs
Is there an airport nearby?YesYesYes
Logistics considerations
Physical office space required?YesYesYes
Quality of utilities?ExcellentHighHigh
Average industrial space rental per 1,000s sq. m.

€2,000€2,500€3,000
Average warehouse space rental per 1,000sq. m.€3,500€3,500 - €5,000€4,200
Attractive for setting up a manufacturing business?YesYesYes
Average monthly electricity prices? (per Kwh)€0.06€0.06€0.06
Proximity of sea port in kilometres?200km3km50km
Proximity of airport in kilometres?27km13km3km
Proximity of rail in kilometres?9km1km2km
Accounting and tax considerations
Corporate tax rate (%)?10%10%10%
No duties on imports and exports?

YesYesNo
VAT on imported products?0%0%20%
VAT exemption on products sold in Bulgaria?NoNoNo
Monthly VAT tax filing required?YesYesYes
Tax incentives for manufacturing start-ups?YesYesYes
Annual tax returns to be submitted?YesYesYes
Annual government inspection required?NoNoNo
Annual audit required?NoNoNo
Annual financial statements required?YesYesYes
Access to double taxation avoidance agreements?YesYesYes
Corporate banking and financial considerations
Recommended bank for corporate banking?Unicredit BulbankSociete GeneraleDSK Bank
Client must travel for account opening?NoNoNo
Corporate visa debit cards available?YesYesYes
Quality of e-banking platform?GoodGoodGood
English e-banking platform available?YesYesYes
Can secures loans from Bulgaria banks?YesYesYes
Access to Private Equity/VC funds in Bulgaria?

YesYesYes
Can the company list on the local stock exchange?

YesYesYes
Labour considerations
Can hire foreign employees?YesYesYes
Quota (%) for local employees?NoNoNo
How long to secure the work permit?

2 months2 months2 months
Client must travel before securing a long-term visa?NoNoNo
Average monthly salary for employees?

€550€550€550
Payroll tax exemption for foreign employees?NoNoNo
Social security contributions exemptions for foreign employees?NoNoNo

External readings

Contact us

For additional information on our free zone services in Bulgaria, please email us at email@healyconsultants.com. Alternatively please contact our in-house country expert, Mr. Petar Chakarov, directly:
client relationship officer - Petar
Bulgarian chamber of commerce and industry Bulgaria financial supervision commission Bulgaria government