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A Guide to Franchising in the Nations of East and Central Europe

East & Central Europe: Country Overviews
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The flag of BulgariaBulgaria

Capital City: Sofia
Population (Millions): 7


GDP Per Capita: US$ 12,500
GDP per Sector:
Agriculture - 7.5%
Industry - 27.6%
Services - 64.9%
Currency: Lev (BGN)
Ex.Rates: leva (BGN) per US dollar - 1.4352
Big Cities (>100,000): Plovdiv, Varna, Burgas, Rousse, Stara Zagora, Pleven, Sliven, Dobrich
Urban Population: 0.71
Languages: Bulgarian 84.5%, Turkish 9.6%, Roma 4.1%, other and unspecified 1.8%


The Bulgars, a Central Asian Turkic tribe, merged with the local Slavic inhabitants in the late 7th century to form the first Bulgarian state. In succeeding centuries, Bulgaria struggled with the Byzantine Empire to assert its place in the Balkans, but by the end of the 14th century the country was overrun by the Ottoman Turks. Northern Bulgaria attained autonomy in 1878 and all of Bulgaria became independent from the Ottoman Empire in 1908. Having fought on the losing side in both World Wars, Bulgaria fell within the Soviet sphere of influence and became a People's Republic in 1946. Communist domination ended in 1990, when Bulgaria held its first multiparty election since World War II and began the contentious process of moving toward political democracy and a market economy while combating inflation, unemployment, corruption, and crime. The country joined NATO in 2004 and the EU in 2007.


The Bulgarian legal framework is very accommodating to foreign franchises. Currently, there are no franchise laws or specific regulations pertaining to this business model. In general, no specific registration or government approval is required in order to establish a franchise enterprise. Franchisors must comply with the provisions of the Bulgarian Commerce Law. No restrictions are imposed on repatriation of earnings, capital royalities, or interest. Intellectual property rights are recognized and protected.

The Investment Promotion Act, last amended in 2006, was designed to encourage foreign investments. The act stipulates equal treatment of foreign domestic investors and creates conditions for improved administrative services. It further includes an investment incentive package and encourages implementation of investment projects over a period of up to three years. It is this law that explicitly recognizes intellectual properties and securities as a foreign investment.

U.S. franchisors are further protected by the U.S.-Bulgarian Bilateral Investment Treaty from 1994. It includes obligations to U.S. investors such as national treatment and most favored nation status, the right to make financial transfers freely and without delay, international law standards for expropriation and compensation, and access to binding international arbitration.

The Bulgarian government has established the infrastructure neccessary to provide adequate and effective protection of intellectual property, Bulgarian law protects the acquisition and disposition of property rights. All intellectual property laws are harmonized with EU legislation, the Agreement on Trade-Related Aspects of Intellectual Property Rights, and other international acts. Bulgaria is a member of the World Intellectual Property Organization and a signatory of the Paris Convention treaty's 171 contracting states, including the United States and most European countries, is equally recognized, protected and accessible domestically and abroad.

The registration of trademarks, trade services and all intellectual property is filed with the Bulgarian Patent and Trademark Office. The Council of Intellectual Property Protection, wich is a part of the Bulgarian Ministry of Culture, coordinates intellectual property protection and enforcement. The Bulgarian Commerce Law grants the exclusive right for a trade name to be used only by the merchant who has registered it. In case of infringment, the interested party is free to seek an injunction, as well as damages.

The Bulgarien Commerce Law also mandates that procurators, agents, assistants and representatives protect trade secrets and their good name as merchants. Business methods can be kept as a commercial and production secret under the Law on Protection of the Competition.


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