On 01.01.2018 the amendments and supplements to the Non-Profit Legal Entities Actentered into force, marking the start of the reform of the registration of Bulgarian non-profit legal entities. In its main part, it consists of the transfer of the registration of non-profit legal entities from the regional courts to the specially created, by amendments to the Commercial Register and Register of Non-Profit Legal Entities Act Register of Non-Profit Legal Entities at the Registry Agency.
Implemented with the active participation of the Center for Regulatory Impact Assessment, the reform was planned to take place smoothly and gradually, without creating obstacles, burdens or upheaval for Bulgarian non-profit legal entities. First, it covers all newly created non-profit legal entities established after 01.01.2018, which will have to be entered directly in the Register of Non-Profit Legal Entities at the Registry Agency. Second, for existing non-profit legal entities, i.e. those established before 01.01.2018, a period of 3 years from the entry into force of the law, i.e. until 31.12.2020, is provided within which they must re-register with the Registry Agency. If in the meantime, before the 3-year period expires, they need to register changes in some of the circumstances subject to registration, they will also have to re-register with the Registry Agency together with the change.
The principle laid down in the amendments to the Non-Profit Legal Entities Act (NPLEA) is that all existing non-profit legal entities continue to operate under the old procedure until the deadline for re-registration expires, which is 31.12.2020.
PUBLIC-BENEFIT NON-PROFIT LEGAL ENTITIES ARE NOT REQUIRED TO RE-REGISTER WITH THE REGISTRY AGENCY BY 30.06.2018 as was reported at the end of 2017. Their obligation to submit annual financial statements and activity reports by that date has been wrongly linked to the re-registration requirement, owing to an interpretation of some provisions of the law that contradicts others (in particular § 25, para. 1 and § 26, para. 4 of the Transitional and Final Provisions of the NPLEA), which provide for a re-registration deadline of 31.12.2020.
PRIVATE-BENEFIT NON-PROFIT LEGAL ENTITIES ARE NOT REQUIRED TO PUBLISH THEIR ANNUAL FINANCIAL STATEMENTS WITH THE REGISTRY AGENCY after they re-register with it, as was also reported at the end of last year. The general provisions of the NPLEA contain a rule (Art. 18, para. 2, item 4) under which the financial statements of the non-profit legal entity are subject to publication in the Register at the Registry Agency, which may give the misleading impression that it applies to all non-profit legal entities. The Accountancy Act (Art. 38, para. 1, in force from 01.01.2018), however, imposes such an obligation only on non-profit legal entities with public-benefit status.