Attachment of a Share in a Bulgarian Company

Under Article 517 of the Bulgarian Code of Civil Procedure, enforcement against a debtor’s share in a commercial company begins with an attachment notice sent for registration with the Registry Agency. The attachment takes effect upon its entry in the Commercial Register.

Effect of the attachment

The attachment restricts dispositions with the attached membership interest. A transfer made in breach of the restriction may be ineffective against the enforcement creditor under the rules of the Code of Civil Procedure.

Shares in a limited liability company

Where the debtor is a member of a limited liability company, the attachment protects the creditor’s ability to continue enforcement against the monetary value of the debtor’s share. Subject to the statutory requirements, the creditor may take steps concerning termination of the debtor’s participation and may seek authorisation to bring an action for termination of the company.

A share-transfer agreement may produce effects between its parties, but registration and the prior attachment are important for its effect against the creditor and third parties. The dates of the attachment, the agreement and the respective entries in the Commercial Register must therefore be checked carefully.

The outcome depends on the company’s legal form, the enforcement file and the exact registrations. This article is not legal advice for a particular case.

For assistance with commercial or enforcement law, contact attorney Mihail Tomov.