Social media as a sales channel – what you need to know

Internet, Social media, Venture Capital, Private companies, Startups

“I am passionate about Indian cuisine and want to start a small venture offering home cooked food for delivery via Instagram. What should I do to make sure my venture is in line with Bulgarian law?”

• Register! Under Bulgarian law, even a small venture of this type is subject to regulation if it can be seen as a business and requires registration with the appropriate government agency. In this case, the aspiring food entrepreneur must register their business with the regional office of the Food Safety Agency (Агенция по безопасност на храните). One of the requirements for successful registration is describing how you intend to make food and deliver it. The goal of this is to ensure you will prepare the food in a safe way and therefore you will need to show you will meet safety requirements.
• Be ready to pay tax. The sale of food through a social media platform is legally no different from selling any other goods in a more traditional way. You will be subject to the same tax obligations that might apply to any other business and must include any profit in your yearly tax return. The precise tax obligations will depend on the business form you decide to use, among other things.
• What if someone gets ill? This is important to consider. The Food Safety Agency has the power to investigate, and could shut down your business pending safety inspections. This is more likely if there are complaints about food poisoning. On the other hand, in general it would be difficult for a customer to demonstrate a case for compensation – subject to the specific facts of each case. However, you should keep in mind the potential reputational damage connected to reports of bad experiences. One way of protecting yourself may be by keeping a record of your supplies and a workplace cleaning diary, etc.

There are also other issues you may want to consider (eg, connected to your social media presence) and we will be happy to advise on these – do get in touch!

New Balkans Law Office regularly advises startups and has a devoted set of legal offerings tailored to founders needs. Find out more at our Startup Desk