This article refers to “acquisition of the enterprise of a Sole Proprietor” in situations where following the latter’s death its heirs are willing to carry on the business activity of the deceased. If there are no successors to the enterprise willing to carry on the business, then the Sole Proprietor’s business name should be deleted from the Commercial Register.
The business activity can be carried on only by the heir who has acquired the enterprise. The latter can be acquired by only one of the heirs and that raises serious issues in the event where the deceased has more than one heir. In such situation heirs would be required to reach mutual consent on how and who is to acquire the enterprise.
Practically, the best option for the timely securing of a holder entitled to organize and manage the business activity would be entering into a notarized agreement (settlement) between the heirs on which of them is to acquire the enterprise of the deceased Sole Proprietor.
Legal theory and practice are contradictive in determining the legal nature of the acquisition of a Sole Proprietor’s commercial enterprise – whether such acquisition refers only to the activity being carried on or also covers and effects the arrangement of the property relations between the coheirs with regard to the commercial enterprise (as a separate part of the estate of the deceased Sole Proprietor), thus the latter being transferred into ownership of only one of them. In my opinion, answering such question would require taking into account the specific content of the document materializing the consent in any partucular situation – if such document effects distribution of the inheritance or has other translative effect towards the inherited portions of the enterprise, then it should be recognized that the one acquiring the enterprise also becomes its owner.
The acquisition of a Sole Proprietor’s commercial enterprise by one of its successors pursuant to Art. 60, par. 2 of the Commerce Act is subject to entry into the Commercial Register.
If the acquiring successor does not already have a registration as a Sole Proprietor prior to the acquisition, he/she would need to request such registration simultaneously with the entry of the acquisition – thus being allotted a new unified identification code (UIC). The heir who is acquiring the enterprise of the Sole Proprietor may keep its business name but would need to add his/her name (i.e., the name of the new owner) as well.
Application and Necessary Documents
A special application needs to be filed with the Commercial Register for the purposes of the acquisition to be registered – a standard form application V1 (В1 in Bulgarian).
The application may be filed electronically (via the Internet) as well – by being signed with an electronic signature. A lawyer may be authorized for such purposes as well – the power of attorney should be explicit but does not require any notarization of the signature.
The following documents need to be enclosed to the application:
Notarized agreement on the acquisition of the enterprise;
Certificate by the NRA under Art. 77 of the TSIPC;
Declaration on the truthfulness of the stated for registration circumstances and acceptance of the submitted for announcement acts;
Document for paid state fee.
You don’t need to submit an A1 application form for the deletion of the Sole Proprietor – such deletion is to be carried out ex officio (an additional application for deletion would be needed only where the heirs are not willing to carry on the business activity). When the acquiring successor has not been registered as a Sole Proprietor himself/herself, an additional A1 application form would need to be submitted for the purposes of such registration together with the respective enclosures thereto.
Fees and Other Costs
Pursuant to Art. 16a, par. 1 of the Tariff on the State Fees Collected by the Registry Agency, the state fee for entering a transfer of an enterprise of a Sole Proprietor into the Commercial Register is 30 Levs. Pursuant to par. 2, when the application is filed electronically, including by an authorized to that end lawyer, the due fee would be in the amount of 15 Levs.
Additional costs for notarization fees will apply as well (depending on the particular situation – e.g., the number of successors, etc.).
Information about the due attorney fee may be found on page Fees.