🇧🇬 Bulgaria — EOOD vs DPK: The New Variable Capital Company Explained

For over 30 years, anyone starting a company in Bulgaria had essentially two realistic choices: an OOD/EOOD (limited liability company) or an AD (joint-stock company). In July 2023, the Bulgarian Parliament amended the Commercial Act (Търговски закон) to add a new capital company alongside them: the Variable Capital Company — дружество с променлив капитал, or DPK (ДПК). Its single-owner version is the EDPK (ЕДПК), the direct counterpart to the EOOD.

The law was published in the State Gazette in August 2023, but the Registry Agency needed time to adapt its regulations and IT systems before anyone could actually register one. Registration became possible from late 2024 — which means a lot of the guidance floating around online was written before it was usable, and hasn't caught up.

This article explains what the DPK actually is, how the single-member EDPK compares to the EOOD, and — most importantly — which one you should pick.

Main takeaways

What the DPK actually is

The core idea is in the name: variable capital. In an EOOD, your share capital is a fixed number recorded in the Trade Register, and changing it means a formal procedure — a decision, amended articles, and a new filing. In a DPK, the capital is not registered as a fixed figure at all. It's determined by the shares (дялове) actually issued, and its amount is simply established each year in the annual financial statements.

Legally the DPK sits between an OOD/EOOD and an AD, borrowing from both. Bulgarian commentators consistently describe it as a hybrid, and it's explicitly modelled on what startups need: issue equity to a new hire, take an investor in a few months later, and do it without a Trade Register filing for every move.

Eligibility — it's a small-business-only form

This is the constraint that decides the question for a lot of people, so it's worth stating up front. The DPK/EDPK is reserved for small enterprises. To keep the status, the company must have:

• Fewer than 50 employees, and
• Annual turnover and/or asset value not exceeding 4,000,000 BGN (roughly 2.05 million EUR)

Whether you still qualify is established at the annual general meeting that approves the financial statements. If you've crossed the thresholds, you must transform into another capital company type — typically an OOD/EOOD or an AD — by the end of the following financial year. Miss that deadline and the consequence is not a fine: the prosecutor can bring a claim and the district court dissolves the company, after which it's struck from the register.

One terminology note: the 4M BGN threshold here is specific to the DPK chapter of the Commercial Act and is stricter than the "small enterprise" definition used in the Accounting Act. If you see different numbers elsewhere, that's usually why.

EOOD vs EDPK — head to head

Note what is not in that table: tax. Both are capital companies, so the tax treatment is the same — 10% corporate tax, 5% dividend tax, and the owner insured, usually on the statutory minimum social base. The DPK is not a tax optimization; it's a corporate-governance instrument. If tax is what you're optimizing, the numbers in the EOOD taxation guide apply unchanged.

What the DPK is genuinely good at

Employee equity. The minimum nominal value per share is 0.01 EUR — one eurocent — and there is no statutory minimum total capital, which means you can slice ownership finely enough to grant granular equity to employees and contractors. Doing the same in an EOOD is clumsy: every allocation is a notarial share transfer and a Trade Register filing.

Taking on investors. Different classes of shares with different rights — liquidation preference, preferential dividends, multiple votes, redemption — are exactly what a funding round is made of. An EOOD's uniform shares force you to bolt this on with shareholder agreements that sit awkwardly on top of the corporate structure.

Changing the cap table without bureaucracy. Because capital is variable, issuing, redeeming, or transferring shares doesn't trigger a Trade Register filing each time — the amount is simply recalculated once a year with the financial statements, and the cap table lives in the internal shareholders' book. The formalities on the transfer itself are lighter than an EOOD's, and how light depends on how you draft the articles.

Modern governance. The law explicitly supports remote general meetings and electronic decision-making, and lets you run the company either with one or more managers (управители) or with a management board, without a rigid minimum board size.

The catch

It's new. Courts, tax authorities, banks, and counterparties have far less experience with the DPK than with the EOOD. Opening a bank account, getting a credit line, or satisfying a large client's compliance department is simply more predictable with a company type that everyone has seen a thousand times.

The size cap is a future problem. Reaching 50 employees, or exceeding both 4M BGN financial measures, forces a conversion — legal work and cost you did not have to plan for with an EOOD.

Privacy cuts both ways. Owners not being listed in the Trade Register is a genuine benefit for some, but some counterparties and lenders prefer the transparency of an OOD/EOOD.

The articles do a lot of the work. Because so many rights and procedures live in the company's articles rather than in the statute, poor drafting creates real risk — internal conflict, investor uncertainty, or rights that don't work the way you assumed. An EOOD is more rigid, but rigidity means fewer ways to get it wrong.

So which one should you register?

For most freelancers and small companies, the EDPK is the better fit. That's not an accident — it's the form the legislature actually designed for you. The tax is identical to an EOOD, the formation is cheaper and lighter (no capital subscription bank account), and the structure doesn't lock you into decisions you haven't made yet. If a co-founder, an investor, or an employee you want to give equity to shows up in year three, the EDPK absorbs that without restructuring — no Trade Register filing per transfer, and if you draft the articles for it, no notary either. An EOOD makes you pay a notary and file with the Trade Register for every one of those moves.

The flexibility costs you nothing while you don't need it, which is what makes it the sensible default rather than a bet.

Choose the EOOD if predictability matters more to you than flexibility. Concretely, that means: you deal with banks or large corporate clients whose compliance processes may not have caught up with the new form; you want the depth of 30 years of case law and established practice behind your structure; or you realistically expect to outgrow the small-enterprise cap and would rather not pay for a conversion later. It's the conservative choice, and for a stable, traditional business it's still a perfectly good one.

If you're still deciding between operating through a company at all versus registering as an individual freelancer (свободна професия), that's the more consequential decision — and it's covered in the structure comparison.

Registration specifics

If you do go with a DPK/EDPK:

• Founders can be one or more natural or legal persons, subject to the Commercial Act's general disqualification rules (which catch, for example, declared-insolvent individuals and former managers of insolvent companies with unsatisfied creditors).
• The name must carry the form — the company name has to include "ДПК" or "ЕДПК" (or the full Bulgarian wording) so the legal form is unambiguous.
• You must maintain an internal shareholders' book. This is a statutory obligation, and since the Trade Register doesn't hold ownership data, this book is the evidence of who owns what. Treat it as a real record, not a formality.
• You will have to declare beneficial owners under the anti-money-laundering rules. Note this is actually a step more than a plain EOOD: an EOOD owned directly by a natural person is exempt from filing a separate beneficial-owner declaration, precisely because the register already shows the owner. A DPK's owners aren't visible there, so the exemption doesn't apply. Reduced public visibility is not reduced AML compliance — if anything, it's slightly more paperwork.
• The articles matter more than in an EOOD. Budget for a lawyer who has actually drafted one of these, not a template.

What about Podnikio?

Podnikio supports Bulgarian companies with the full stack: registration end-to-end, invoicing, a business bank account, and a connected accountant handling bookkeeping, corporate tax, annual financial statements, and dividend declarations — for a single monthly fee. If you're unsure whether an EOOD or an EDPK fits your plans, that's exactly the kind of thing to settle in a consultation before you file anything, because changing it later is the expensive path.

Calculator

The tax treatment is identical for both company forms, so the EOOD calculator applies to a DPK too. Enter your expected annual revenue to see the breakdown — and if you're weighing other countries, check out the full tax calculator.

Sources

Primary legislation

• Commercial Act (Търговски закон)
• State Gazette (Държавен вестник) — the 2023 amendment
• Ministry of Economy — SME handbook on choosing a legal form

Professional analysis

• EY — 10 things we did (not) realize about the new entity (English)
• Kambourov & Partners — the variable capital company (English)
• Delchev & Partners — variable capital company (English)
• Schoenherr Bulgaria — the variable capital company (English)
• STZ Law — variable capital company introduced by Bulgarian Parliament (English)
• Deyan Sotirov — the new option for startup companies
• Advantage Austria — overview of the new company form
• Trud i Pravo — Дружество с променлив капитал

This article is general information, not legal advice. The DPK has little case law behind it and much of how it behaves in practice depends on how the company's articles are drafted — check your specific situation with a lawyer or accountant before you register anything.

Contact us

If you're deciding between an EOOD and the new variable capital company, or want to talk through what your structure should look like before you register, reach out. We offer a free initial consultation.