For foreigners seeking property in Bulgaria, understanding the legal landscape is crucial. While direct ownership of land, particularly agricultural land, is restricted for individuals under the constitution, there are no limitations on owning buildings or real rights, such as usage or construction rights. The primary restriction revolves around land ownership beneath buildings. A common workaround involves establishing a Bulgarian-registered company, which can then legally acquire full land ownership rights, including agricultural land. This method is frequently used by foreigners purchasing houses with gardens or land.
Bulgaria’s potential entry into the EU is anticipated to create a truly free market for land, contributing to the country’s attractive property prices compared to Western and Central Europe. This historical context makes Bulgarian real estate a compelling investment opportunity.
Foreign investments in Bulgaria are safeguarded through several legal mechanisms:
* **National Treatment:** Foreign investors receive the same legal treatment as domestic investors.
* **Most Favored Nation Status:** Foreign investors benefit from the most favorable treatment granted to any nation.
* **Priority of International Treaties:** International treaties take precedence over national laws.
* **Legal Guarantees Against Adverse Changes:** Investments made before legislative changes are protected by the laws in effect at the time of the investment.
* **Protection Against Expropriation:** Expropriation of foreign-owned real estate is only permitted on lawful grounds.
The most popular business structure for foreign property investment is a Limited Liability Company (LLC). Other options include General Partnerships, Limited Partnerships, Joint Stock Companies, Sole Proprietorships, Joint Ventures, Holdings, Cooperatives, Branches, and Representative Offices. By incorporating a company, foreigners can effectively bypass land ownership restrictions and hold land as a company asset.