BULGARIA Law and Practice Contributed by: Yordan Naydenov, Mihail Vishanin and Hristian Gueorguiev, Boyanov & Co.
ers for business, and amending Regulation (EU) 2017/1129 and Directive (EU) 2019/1937. No significant amendments were made to the laws regulating the public offering of securi - ties in 2024. In the overall legislation related to this sector, amendments were made aimed at further harmonising it with the requirements of European regulations and directives. In par - ticular, the amendments adopted in 2024 were mainly concerned with some fine touches as to the mandatory content and standards regarding the information contained in various manage - ment reports and declarations. 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 Bul - garian stock market. Nevertheless, Bulgarian law does not prohibit stakebuilding, but it should be noted that stakebuilding may trigger certain 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, follow - ing 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 Meet - ing of the public company. The voting rights are calculated based on the total amount of voting shares, regardless of whether a restriction is
imposed on the right to exercise them. Calcu - lation 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 report - ing 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. Bulgarian 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 Collec - tive 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 associated with the underlying instruments, the quantitative lim - its and the methods which have been chosen in order to estimate the risks associated with transactions in derivative instruments for each collective investment scheme managed thereby.
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