Exporting to Bulgaria

In the year to December 2019, total UK exports to Bulgaria amounted to £953 million (ONS, 2020). Amongst the top UK goods exports by value were specialised machinery, beverages, medicinal and pharmaceutical products, clothing and general industrial machinery. UK companies active in the market include Shell, GSK, JCB and Mott McDonald.

Gateway to emerging Europe

Bulgaria is a part of the Central and Eastern European (CEE) region, with over 100 million consumers, so it can act as a gateway into these markets. The CEE region is easily accessible from the UK, offers considerable potential for British businesses and has widespread use of English as the business language.

Strategic location

Bulgaria is bordered by large countries such as Turkey, Greece, Serbia and Romania, while its eastern coast borders the Black Sea. If your business is looking to export to a larger Eastern European market, Bulgaria may be a good place to base your operations.

Economic growth

Since the 2009 global economic and financial crisis, Bulgaria has made a sustained economic recovery, with GDP growth reaching 3.2% in 2018 (World Bank, 2019). The economy has proved relatively resilient due to growth in export, offshoring and tourism.

Ease of doing business

61st

out of 190 countries (World Bank, 2019)

Currency

Lev

Business language

Bulgarian

You may need a translator

GDP per capita

$9,314

UK is $41,030 (IMF, 2019)

Economic growth

3.4%

(IMF, 2019)

Time zone

GMT +2

High potential industries in the country for UK businesses

There are opportunities for UK companies across a broad range of industries. Our trade advisers in Bulgaria have identified particular opportunities in several sectors.

Doing business in Bulgaria

Doing business in Bulgaria is generally straightforward. However, there can be challenges, particularly in work with the public sector - arcane bureaucracy, complicated public procurement and slow judicial processes.

Preparing to export

Tax and Customs

The UK has signed a double taxation convention with Bulgaria. The Ministry of Finance has responsibility for tax in Bulgaria.

VAT

The standard VAT rate is 20%. There are reduced VAT rates to 9% for hotel services. If you’re registered for VAT in the UK, it may be possible to zero-rate the goods you export to Bugaria, provided certain conditions are met.

Company tax

Corporate income tax is 10%. Certain company expenses are taxed at 10%.

Import duties

The internal market of the EU is a single market which allows the free movement of goods and services.

Most goods can be imported into Bulgaria without restriction. However, permits from the Ministry of Economy will be required for:

  • agricultural products
  • precious metals
  • military goods
  • drugs

You are encouraged to use a reputable customs clearance agent familiar with the customs clearance formalities of Bulgaria.

Regulations

Legislation in Bulgaria has been aligned with EU legislation to ensure the free movement of people, goods, services and capital.

Packaging and labelling

Products and packaging should meet EU standards.

Bulgaria is a member of the:

  • International Organisation for Standardization (ISO)
  • International Electrotechnical Commission (IEC)
  • International Technical Union (ITU)

The Bulgarian Institute for Standardisation (BDS) is responsible for standards. Bulgaria has standardisation and product certification bodies. Bulgarian ministries or agencies issue specific standards and certificates for various sectors. Labelling must be in Bulgarian.

Operating in Bulgaria

Intellectual property

As a first step, we advise you to speak to an intellectual property lawyer if you think you need patent protection when exporting.

Trademarks, designs, patents and copyright are the principal forms of IP protection available to companies and individuals.

IP law, especially for patent protection, is not totally harmonised within the EU. Bulgaria is a member of the main international conventions protecting intellectual property. However enforcement of IP rights can be challenging.

The Bulgarian Patent Office is responsible for implementing legislation on IP rights.

Payment terms

Typically, this is 30 days.

Start-up considerations

Setting up a local office or finding a reliable local partner is critical for doing business in Bulgaria. Business may be carried out:

  • directly from the UK
  • by the appointment of agents/distributors
  • through licensing and franchising
  • partnering with a local company with complementary skill set
  • through a local business or branch

A local business can be established by:

  • registration of a representative office or branch office
  • incorporation of a new legal entity

Various corporate legal entities are available. Foreign investors are allowed to hold up to 100% of the registered capital of a company. New companies can now be incorporated on the new national electronic commercial register

Partnering with a local company with complementary skills is recommended if you wish to provide consultancy services in Bulgaria.

Next steps

DIT can advise you on doing business abroad, and help put you in touch with other people who can help such as lawyers and distributors.