Inheritance of company shares in Bulgaria
Bulgarian company shares can be transferred and inherited. The inheritance itself is a straightforward procedure if an experienced in the field lawyer is employed.
The property of the deceased includes both their assets and debts, and the heirs cannot acquire only the assets.
Inheritance in EOOD company
The EOOD stands for a Sole shareholder limited company. There is only one owner and the owner acts as the general assembly of the company.
The sole shareholder can decide how the assets to be distributed upon his death in the Memorandum or grant a will. The heir who will be de facto the new sole shareholder of the company can proceed liquidating the company and disposing the company assets. If there are company assets, these can be sold during the liquidation procedure.
The heir can also decide to keep the company and continue the business of the testator.
The heir has to provide a death certificate and certificate of inheritance. Our lawyers can assist you to obtain a certificate of inheritance through the local municipality in Bulgaria if the testator was registered in Bulgaria.
Inheritance in OOD company
Several scenarios have to be considered in cases of OOD companies. The OOD stands for Partnership limited company. This means two or more shareholders own the capital of company.
If the Memorandum excludes the succession of shares, the successor cannot become a partner. However, the successor must receive the monetary equivalent of the shares held by the deceased partner.
If the Memorandum includes the succession of shares, however, the Memorandum does not specify who will be the heirs, the heir has to apply to the general assembly of the company to become a partner. Since heirs are considered third parties to the company, the rules for transfer of shares to third parties apply. If the application is denied, the heir will be paid out according to the shareholding of the deceased partner.
The Memorandum includes the succession of shares, and states who will be successors. Even if the Memorandum states who will be the heirs, it can be still problematic to transfer the ownership of shares to the heirs. The legislation in this area is vague and caselaw controversial. To guarantee the rights of your heirs against hostile shareholders, please get in touch with our team.
If the successor is a partner in the company, the successor’s share increases automatically with the adoption of the inheritance of the share capital that was property of the deceased partner. In this case there is no need of the general assembly of the company to accept the deceased property transfer to the heir.
If the successor is a third party, legal theory maintains that if the Memorandum states that the successor automatically becomes a partner, there is no need for a decision of the General Assembly.
To protect your rights, please get in touch with our team.