Capital Increase and Decrease

Capital increase

The capital of an LLC can be increased in two main ways:

Through new contributions — shareholders or new parties make additional cash or non-cash contributions
Through retained profits — undistributed profits are capitalised by increasing the nominal value of shares or subscribing new shares

The decision to increase the capital is adopted unanimously by the General Meeting and is subject to notarisation. For increases through cash contributions, a bank certificate for the deposited capital is required.

Capital decrease

Capital decrease also requires a unanimous General Meeting resolution. An important restriction: the capital cannot be reduced below the minimum of BGN 2.

There are three ways to decrease the capital:

Reducing the nominal value of shares — each share is proportionally "devalued"
Termination of a shareholder's membership — the departing shareholder's shares are absorbed
Release from obligation for unpaid contribution — for subscribed but unpaid capital

Both operations — increase and decrease — are registered in the Commercial Register.

Timeline

The procedure takes approximately 5–7 business days for document preparation and filing. For increases through cash contributions, the funds must be deposited in advance into an escrow account, which may take an additional 1–2 days.

Required documents

General Meeting resolution (unanimous, notarised)
Updated articles of association
Bank certificate for deposited capital (for increases)
Declarations under Art. 13, para. 4 of the Commercial Register Act
State fee

Frequently asked questions

Why would I need a capital increase?

A capital increase enhances the company's creditworthiness, which is important when applying for bank loans, participating in public procurement, or attracting investors. Additionally, for certain activities (e.g. insurance, banking), the law requires a minimum capital significantly exceeding the standard BGN 2.

Can the capital be increased with non-cash contributions?

Yes, the capital may be increased through an in-kind contribution (apport) — for example real estate, a vehicle, intellectual property, or another asset. The non-cash contribution is subject to valuation by three independent experts appointed by the Registry Agency.

What are the risks of a capital decrease?

A capital decrease may send a negative signal to creditors and business partners. The law provides for creditor protection — they may request security for their claims or early repayment. We recommend careful planning and consultation before taking this step.

Capital Increase and Decrease