Improvement to right to citizenship by investment

Recent legislative changes in Bulgarian investment laws now do indeed provide a direct route to citizenship.

Foreign nationals who have obtained permanent residence on the basis of participating in an investment programme, may acquire Bulgarian citizenship via an accelerated route. They become eligible for citizenship after one year from the date of issuance of their permanent residence permit.

This is contradistinction to the more usual case, in which the qualifying period is five years.

To qualify through the new routes, candidates must make additional qualifying investments after obtaining a residence permit.

The options are as follows:

Option 1

Investing BGN 1,000,000 (approx. EUR 513,0001) or more in the shares of 1 or more companies traded on the Bulgarian Stock Exchange. Upon obtaining a permanent residence permit on this basis, investing an additional BGN 1,000,000 in the equity of a Bulgarian company, undertaking a priority investment project certified as such by the relevant agency of the Bulgarian Government (“a certified investment project”);

Option 2

Investing BGN 6,000,000 (approx. EUR 3,070,000) or more in the share capital of an unlisted Bulgarian company and upon obtaining a permanent residence permit on this basis, investing a further BGN 1,000,000 in the equity of a Bulgarian company, undertaking in a certified investment project;

Option 3

Being either:

(1) a holder of 50% or more of the shares in the capital of; or

(2) the registered Managing Director

of a Bulgarian company (“the SPV”), engaged in a certified investment project. On obtaining a permanent residence permit, the foreign national must continue to be a holder of shares in the SPV;

and

(3) the SPV completes investments during its first year, amounting to more than BGN 20,000,000 (approx. EUR 10,260,000).

A new Bill was proposed to Parliament in July, intended to amend the currently applicable Foreign Nationals in Bulgaria Act and particularly is very likely to add the following option (Option 4) to the above list:

Option 4 (proposed)

Depositing BGN 1,000,000 (approx. EUR 513,000) or more in an account held with a regulated banking institution in Bulgaria under an discretionary funds management agreement for a term of at least 5 years. After obtaining a permanent residence permit on this basis, investing an additional BGN 2,000,000 in a similar account, OR BGN 1,000,000 in the equity of a Bulgarian company, engaged in a certified investment project.

Under all accelerated options above (existing and proposed), investors may apply for naturalization without having to meet the requirements of knowledge of the Bulgarian language or of renouncement of their existing citizenship.

The application process for permanent residency could take between 3 and 5 months. Citizenship applications on the above grounds are required to be treated with priority and to be reviewed within 6 months.

Family members of permanent resident foreign nationals or of newly-naturalized Bulgarian citizens may apply for residence on the ground of their Bulgarian resident/national’s status. Certain new changes introduced in the new Bill intend to facilitate the processing of family member applications by the members of the families of investors in Bulgaria.

At present family members can apply for residence permits on separate grounds and apply for citizenship after 5 years of residency in Bulgaria.

Lastly but perhaps no less importantly to planning, investors and their family members are also excluded from the categories of permanent residents who are obliged to reside physically in Bulgaria.

We will be happy to advise in further details about residence permit application process and Bulgarian citizenship acquisition procedure as well as to assist with any of the stages.



Recent work:

NBLO helps Dutch investor win summary judgment in High Court for the sum of GBP 192,000

New Balkans Law Office has acted for Mr Kooter, the individual claimant in legal proceedings recently covered by the British press (e.g., The Evening Standard) and subsequently also in Bulgarian news media (e.g., 24 Chasa).

NBLO has represented Mr Kooter throughout the matter. We assisted with the enforcement of a worldwide freezing order issued by the High Court in London against real estate, bank account and other assets of the defendant situated in Bulgaria. As part of the attempts to preserving assets for enforcing his claim, the claimant also proceeded on the basis of prejudiced against him as a creditor. NBLO additionally acted on various ancillary aspects.

Separately, through one of NBLO’s partners who is dual-qualified as an English barrister, NBLO formed part of Mr Kooter’s UK legal team. In the UK, Mr Kooter won summary judgment for the sum of £192,000, interest and legal costs. The sum awarded was the entire claim by Mr Kooter relating to sums which Ms Radeva had ostensibly offered to invest on his behalf. For a separate part of the claim (approx. €36,000), the High Court was unable to give a summary (effectively, early-stage) judgment on the basis that unlike the investment related claim, the basis of these transfers could not be established without a full investigation of evidence including oral hearings.

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