Inheritance of shares in a single-member limited liability company

Under Article 157(1) of the Bulgarian Commerce Act, a single-member limited liability company owned by an individual is dissolved upon that person’s death unless otherwise provided or the heirs request that the business continue. Under Article 129(1), the deceased sole owner’s shares form part of the estate and pass by succession.

Until the heirs are admitted and registered as members, however, they have only a monetary claim against the company, calculated under Article 125(3) of the Commerce Act.

Whether or not the company’s articles expressly provide for the shares to be taken over by inheritance, that change must itself be registered in the Commercial Register, as follows from Article 122 of the Commerce Act.

An application must be made to remove the deceased sole owner and enter the heirs, or some of them, as members. This entry is a prerequisite for subsequent entries concerning other matters, including changes in representation. A new manager may be registered only if an application to register the deceased owner’s heirs as members is submitted at the same time or has already been submitted.

When conducting the review required by Article 21 of the Commercial Register Act, the registration officer takes into account the data already entered and, where relevant, information in the pending application on which the other requested changes depend. The officer does not take account of facts and circumstances that have not been duly disclosed in the register. To do so would impermissibly extend the review beyond the limits set by Article 21. For the officer conducting the registration proceedings, the company’s legal position is the one reflected in the register. The register’s purpose is to provide up-to-date information accurately reflecting specified aspects of a trader’s legal status at the relevant time.

This article does not provide a legal opinion or advice about any particular person or situation. For assistance with a similar case, consult a lawyer practising in commercial, family and succession law.