BULGARIA Law and Practice Contributed by: Yordan Naydenov, Mihail Vishanin and Hristian Gueorguiev, Boyanov & Co.
2017 on the prospectus to be published when secu - rities are offered to the public or admitted to trading on a regulated market. In addition, in 2022, the POSA was amended to include measures for implementa - tion of Regulation (EU) 2020/1503 of the European Parliament and of the Council of 7 October 2020 on European crowdfunding service providers for busi - ness, and amending Regulation (EU) 2017/1129 and Directive (EU) 2019/1937. No significant amendments were made to the laws regulating the public offering of securities in 2025, save for the introduction of the concept of European Green Bonds and the related requirements of Regula - tion (EU) 2023/2631 and a few touches with reference to the implementation of Regulation (EU) 2022/2554 on the operational resilience of digital technologies in the financial sector. In the overall legislation relating to this sector, amendments were made aimed at fur - ther harmonising it with the requirements of European regulations and directives. 4. Stakebuilding 4.1 Principal Stakebuilding Strategies In Bulgaria, it is not common for a bidder to build a stake in the target prior to launching an offer. The main reason is the low liquidity of the Bulgarian stock market and, in many cases, the low levels of free float of Bulgarian publicly traded companies. Nevertheless, Bulgarian law does not prohibit stakebuilding, but it should be noted that stakebuilding may trigger cer - tain reporting obligations if the thresholds described below are exceeded. 4.2 Material Shareholding Disclosure Threshold Any shareholder that acquires or transfers directly or indirectly (under Article 146 POSA) voting rights in the General Meeting of a public company must notify the Financial Supervision Commission and the public company if, following the acquisition or transfer, their voting rights would go above the threshold of 5% or would fall below that threshold, or a multiple of 5% of the number of voting rights in the General Meeting of the public company. The voting rights are calculated based on the total amount of voting shares, regard -
less of whether a restriction is imposed on the right to exercise them. Calculation is made for each class of shares. Where the thresholds above are reached or exceeded because of direct acquisition or transfer of voting shares, an obligation also arises for notification
to the central securities depository. 4.3 Hurdles to Stakebuilding
Bulgarian law does not provide for the right of a public company to introduce different reporting thresholds. The potential situation where a bidder may become subject to a mandatory takeover bid requirement may be considered as another hurdle to stakebuilding. 4.4 Dealings in Derivatives Dealing in derivatives is allowed in Bulgaria. 4.5 Filing/Reporting Obligations Bulgarian public companies are obliged under the POSA to disclose any changes in the rights given by derivative financial instruments issued by them which give the right to acquire shares of the company. Bul - garian law does not provide for specific competition rules relating to derivatives, and the merger control rules will be triggered if the option to acquire shares is exercised. In addition, under the Collective Investment Schemes and Other Undertakings for Collective Investments Act, the so-called Managing Company shall provide the Financial Supervision Commission with periodic information about the types of derivative financial instruments in which it invests, the major risks asso - ciated with the underlying instruments, the quantita - tive limits and the methods which have been chosen in order to estimate the risks associated with trans - actions in derivative instruments for each collective investment scheme managed thereby. 4.6 Transparency If a takeover bid is made, the bidder is obliged to include in its tender offer certain information. This information must include the intentions of the bidder regarding the future operations of the public company subject to the tender offer and of the bidder, if it is a legal entity, to the extent that the latter is affected by the tender offer. Furthermore, said tender offer must include information regarding retention of the
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