How to Vet a Bulgarian Property Developer Before Buying Off-Plan in 2026

A Complete 10-Step Due Diligence Framework — Company Checks, Permits, Land, Mortgages, Track Record, and the Red Flags That Should Stop a Purchase

10 Due Diligence Steps

Step 1 Commercial Register — Always First

Act 16 Completion Certificate — Verify It

No. 1 Risk: Buying Before Checking the Builder

Introduction: Why You Are Investing in the Developer, Not Just the Property

Foreign buyers purchasing a completed property in Bulgaria face a specific set of legal and financial risks — undisclosed mortgages, building compliance issues, title defects. These are addressed through due diligence on the property itself. Off-plan buyers face all of those risks plus a fundamentally different and more significant one: the property does not yet exist in its finished form, and whether it will ever exist depends entirely on the financial health, competence, and integrity of the developer.

When you sign a preliminary agreement and pay a deposit on an off-plan Bulgarian apartment, you are not buying a property — you are investing in a construction company’s ability and willingness to deliver. The most attractive architecture, the most beautiful renders, and the most compelling location mean nothing if the developer runs into financial difficulties, fails to obtain the necessary permits, becomes embroiled in litigation, or simply decides not to complete the project.

The good news is that most of the information you need to assess these risks is publicly available in Bulgarian government registers — and the remainder can be uncovered through targeted legal and financial investigation. This guide walks through the ten steps of a complete developer due diligence process: what to check, where to check it, what the results mean, and which findings should stop a purchase immediately.

The same process applies whether you are buying directly from a developer, purchasing through a real estate agent presenting a developer’s project, or buying an apartment in a newly completed but recently built building where the developer is still the current owner.

The Specific Risks of Off-Plan Purchases

Risk Overview

Risk	Severity	How It Materialises	Prevention
Construction delays	High	Developer fails to complete on the contracted timeline; buyer’s funds are tied up for months or years longer than expected	Contractual penalties for delay; verify developer’s track record on prior project completion timelines
Project freezing / abandonment	Critical	Developer runs out of funds, faces insolvency, or chooses to abandon the project; partially built structure sits unfinished; buyer’s deposit is at risk	Developer financial analysis; construction finance verification; escrow or bank guarantee for deposit funds
Missing permits	Very High	Developer sells apartments before obtaining all necessary building permits; construction may stop when regulatory issue is identified; completed building may not receive Act 16	Verify valid building permit exists before signing any agreement or paying any deposit
Construction quality failures	Medium	Delivered property does not match advertised specifications; materials inferior; structural issues emerge after completion	Review completed prior projects physically if possible; talk to existing buyers; check for litigation by prior buyers
Developer financial distress	Critical	Developer’s financial difficulties emerge during construction; creditor claims, tax debts, or bank enforcement threaten project completion	Financial statement analysis; enforcement search; bank mortgage verification
Title complications (land)	Very High	Developer does not have clean title to the land; a mortgage on the land is not discharged before transfer; third-party claims on the land emerge	Full Property Register search on the land plot before signing
SPV structure risk	High	Project built through a separate project company (SPV) with no assets, backed by a parent with financial problems; parent guarantee may be insufficient	Analyse both the SPV and the parent; assess whether the guarantee is financially meaningful

The 10-Step Developer Due Diligence Process

Step 1 Check the Company in the Bulgarian Commercial Register

The mandatory first step before anything else

The Bulgarian Commercial Register (Търговски регистър) is a publicly accessible database of all legally registered companies in Bulgaria, maintained by the Agency for Registration (Агенция по вписванията). It is the primary source for verifying a developer’s legal existence, ownership structure, financial reporting, and corporate history.

The register is available online at portal.registryagency.bg and the search is free of charge. Every Bulgarian company has a unique registration number (ЕИК / Unified Identification Code) — you can search by this number or by the company name.

What to Check	What It Tells You	What to Look For	Red Flag
Registration date	How long the company has been in operation	Established companies with track record; date should predate the advertised project	Company registered 0–12 months ago — especially if registered specifically for this project
Shareholders / founders	Who ultimately owns and controls the developer	Identifiable, named individuals or entities with transparent backgrounds	Anonymous ownership; offshore holding companies without clear ultimate beneficial owners; ownership changes immediately before the project launch
Directors / management	Who manages the company; their professional track record	Directors with identifiable history in Bulgarian construction; stable management team	Directors with multiple companies in insolvency; frequent director changes; directors with no verifiable track record
Registered share capital	Minimum capital commitment of the founders	Adequate capital relative to project scale	Extremely low capital (€1 company) for a large-scale development — indicates founders have not committed meaningful capital
Annual financial statements	Revenue, profit, debt levels, asset base	Consistent revenue; profit or manageable losses; debt within reasonable bounds	Missing financial statements; consecutive years of significant losses; rapidly growing debt
Liquidation or insolvency proceedings	Whether the company is in dissolution or bankruptcy	No proceedings pending	Active liquidation, insolvency proceedings, or judicial administration are absolute disqualifiers
History of changes	Amendments to the founding documents; ownership transfers; capital changes	Normal operational changes	Unusual ownership transfers immediately before a new project launch; capital reductions; pledges on shares

HOW TO ACCESS: The Bulgarian Commercial Register (portal.registryagency.bg) is available in Bulgarian. Your independent lawyer accesses this as a standard part of developer due diligence. Bulgaria For Business VCC coordinates full Commercial Register checks for clients considering off-plan purchases. The information is free and public — there is no justification for skipping this step.

Step 2 Assess the Company’s Age and Experience

New is not necessarily bad — but it requires more scrutiny

A newly registered company is not automatically a disqualifier for an off-plan purchase. Many legitimate property developers register a fresh company for each project (a Special Purpose Vehicle or SPV structure) while the development business itself has years of experience. However, a brand new company with no track record, backed by unknown shareholders, represents a different risk profile from a company that has been building and delivering residential properties for a decade.

Company Age / Profile	Risk Level	What It Means	Due Diligence Approach
10+ years of operation; multiple completed projects	Low	Established track record; financial history available; prior projects can be inspected and reviewed	Standard checks; focus on financial health and prior project outcomes
5–10 years; some completed projects	Medium	Some track record; financial history partially available	Review all completed projects; verify Act 16 on each; speak to prior buyers if possible
2–5 years; limited track record	Medium-High	Limited history to assess; financial statements may be thin	Enhanced scrutiny on financial statements; construction finance verification essential; payment protection critical
Under 2 years; no completed projects	High	No track record to assess; may be a legitimate first-time developer or may be a risky proposition	Investigate the individuals behind the company; assess their prior industry experience; payment structure must protect buyer funds
SPV registered for this project only; backed by established parent	Medium (depends on parent)	Common legitimate structure; risk depends entirely on parent company’s financial health and guarantee quality	Full analysis of both the SPV and parent; verify the parent’s financial position; legal assessment of guarantee enforceability
SPV registered for this project only; no identifiable parent or guarantee	Very High	Buyer has no recourse beyond the shell company if the project fails	Treat as equivalent to a startup developer with no track record; maximum payment protection required or avoid

Step 3 Investigate Completed Projects and Track Record

The most telling evidence of what you should expect

A developer’s completed project history is the most direct evidence available about what a buyer should expect. It answers the questions that matter most: Does this company actually finish what it starts? Do completed buildings receive Act 16? Were there material delays? Do the finished buildings match what was advertised? Are there buyers from prior projects who are satisfied or dissatisfied?

This is not a paper exercise — it requires active investigation of actual buildings, not just a review of the developer’s marketing materials.

Identify at least 2–3 completed projects by this developer; if fewer than 2 exist, treat as a first-time developer profile

Visit at least one completed project in person or arrange for an independent local contact to visit on your behalf

Verify that each completed building has a valid Act 16 — check via the municipality’s records or State Building Control Authority (ДНСК)

Research the delivery timeline of prior projects — was completion on schedule, and if not, what was the extent of delay?

Search Bulgarian court databases for any litigation involving the developer and prior buyers

Speak to actual buyers in completed buildings if possible — expat forums, local real estate community groups can facilitate introductions

Review online reviews and social media commentary about the developer

Check whether the developer has any awards, certifications, or industry association memberships

STOP: A developer who has completed multiple projects but cannot demonstrate Act 16 for any of them has a serious pattern of non-compliance. A building without Act 16 is legally unfinished — the developer has failed to complete the regulatory process regardless of whether people are living in the property.

Step 4 Analyse the Developer’s Financial Position

The ability to deliver depends on financial health

A developer’s financial position determines whether they can physically complete the project — pay contractors, purchase materials, service any construction finance, and weather unexpected cost increases. A developer in financial difficulty mid-project is a developer whose project may not be completed.

Financial statements filed with the Commercial Register are the primary source. All Bulgarian companies are legally required to file annual financial statements (годишен финансов отчет) with the Registry Agency. The most recent 2–3 years of statements should be reviewed.

Financial Indicator	What to Examine	Positive Signal	Concern Signal
Revenue trend	Annual turnover over past 3 years	Stable or growing revenue consistent with scale of projects	Declining revenue; very low revenue relative to project size; no revenue (dormant company)
Profitability	Net profit / net loss	Consistent profitability or small, manageable losses in development cycle years	Consecutive years of significant losses; rapidly growing accumulated deficit
Total debt and leverage	Short-term and long-term borrowings	Debt appropriate for project scale; identifiable construction finance facility	Very high debt relative to assets; debt from non-institutional sources; unfunded construction
Liquidity	Current assets vs. current liabilities	Current ratio above 1.0; ability to meet short-term obligations	Current liabilities significantly exceed current assets; liquidity squeeze signals
Construction finance	Whether the project has bank financing in place	Reputable Bulgarian bank has underwritten construction finance — means bank has independently assessed project viability	Project appears to be funded entirely from buyer deposits — means no independent assessment and maximum completion risk if deposit collection falters
Enforcement proceedings	Active enforcement actions by creditors against the company’s assets	None	Active enforcement proceedings indicate creditors who are not being paid; severe warning sign

CONSTRUCTION FINANCE IS A POSITIVE SIGNAL: A project funded by a reputable Bulgarian bank (UniCredit, DSK, UBB) is not inherently riskier than a self-funded project — in fact, the bank’s presence provides an independent assessment of the project’s viability. Banks conduct their own due diligence before providing construction finance; their willingness to lend is indirect evidence that the project, the developer, and the land title have been assessed and found acceptable. A project funded entirely from buyer deposits, with no bank involvement, has no such independent assessment.

Step 5 Check for Litigation and Enforcement Proceedings

Past disputes reveal patterns

Litigation involving a developer — whether with buyers, contractors, suppliers, or creditors — is publicly accessible through Bulgarian court records and reveals patterns that cannot be hidden by marketing materials. The volume, nature, and outcomes of legal disputes are among the most revealing indicators of how a developer treats its obligations and counterparties.

Dispute Type	How to Find	What It Indicates	Severity
Litigation by prior buyers	Bulgarian court information system (court.bg); property-specific searches	Pattern of disputes with buyers is the single most concerning finding	Very High if multiple cases; Medium for isolated case with documented resolution
Contractor and supplier disputes	Court records; BRRA enforcement system	Suggests history of not paying subcontractors; risk that current project’s contractors may not be paid	High if multiple cases
Tax authority enforcement proceedings	NRA (National Revenue Agency) public enforcement list	Unpaid taxes; potential for asset seizure; financial instability	Very High
Bank enforcement proceedings	Property Register; enforcement registry	Developer failing to service construction finance; potential for bank to exercise security over the project	Critical
Labour law disputes	Court records	Disputes with employees; financial instability; management problems	Medium
Planning and building authority enforcement	Municipal building authority records; court records	Unauthorised construction; permit violations; compliance problems with prior projects	Very High — directly relevant to risk that new project will also have compliance issues

STOP: Multiple unresolved disputes with buyers of prior projects is a near-absolute disqualifier. If a developer has a pattern of litigation with existing buyers over construction quality, late delivery, or deposit refusal, there is no rational basis to expect different behaviour on the new project.

Step 6 Verify Rights to the Land

Construction without clear land title creates fundamental legal risk

Every Bulgarian building sits on land. The relationship between the developer and the land — whether they own it outright, hold a right to build under a superstructure agreement, or are developing on land still burdened with third-party rights — directly affects the buyer’s ability to obtain clean title to the finished apartment.

The land title check is conducted through the Bulgarian Property Register using the cadastre identifier of the plot. It is separate from the commercial register check and must be done by your lawyer as a distinct step.

Identify the cadastre identifier (кадастрален идентификатор) of the land plot on which the building is being constructed

Obtain a current Property Register extract for the land plot — verify the registered owner and any recorded encumbrances

Confirm the developer either owns the land outright or holds a valid right to build under a notarially registered superstructure agreement (право на строеж)

Check for any mortgage registered against the land plot — verify what happens to this mortgage when individual apartments are transferred to buyers

Check for any judicial seizures, easements, servitudes, or other restrictions on the land that could affect construction or ownership transfer

Verify that the land’s cadastre designation permits residential construction — certain land categories cannot be built upon without prior reclassification

If the land was recently acquired by the developer: investigate the prior ownership to confirm the transfer was legitimate and at arm’s length

DEVELOPER MORTGAGE ON LAND: It is very common for a developer to have a bank mortgage on the land plot as part of construction financing. This is not inherently problematic — but the preliminary agreement must specify exactly what mechanism will be used to discharge this mortgage when your apartment is transferred. Typically, this is done by ring-fencing individual apartment completion certificates from the land mortgage, or discharging the mortgage from the proceeds of unit sales. Your lawyer must verify that the mechanism actually works in practice before you commit.

Step 7 Verify the Building Permit

No valid permit = no valid construction

A building permit (разрешение за строеж) issued by the relevant municipality is the legal authorisation to construct. Construction that begins before a valid building permit is issued is illegal — any building built without a permit cannot legally be commissioned (no Act 16) and the owner has no legal protection against a demolition order.

Importantly, a building permit can be suspended or revoked if it is found to have been issued in breach of procedures. The existence of a permit at the time you check does not absolutely guarantee its continued validity — but it does mean the developer has at minimum satisfied the initial regulatory requirements.

Document	Status	Meaning	Action Required
Building permit (Разрешение за строеж)	Issued and valid	Construction is legally authorised; municipality has approved the design	Verify the permit is current and has not been suspended or appealed; confirm it applies to the specific building and all floors/units being sold
Building permit	Not yet issued	Construction has not yet been legally authorised; marketing and deposit-taking before a permit exists is a serious risk indicator	Do not sign any binding agreement or pay any deposit until the building permit is issued and verified
Building permit	Issued but under appeal	A third party (neighbour, planning authority, other party) has challenged the validity of the permit	Legal analysis required; purchase should be conditional on resolution of the appeal; do not complete while appeal is pending
Construction drawings (утвърдени инвестиционни проекти)	Approved	Technical design has been reviewed and approved by the municipality; confirms the building can be built as designed	Your lawyer reviews to confirm the apartment you are buying matches the approved design
Cadastre information for the plot	Current	Confirms the land area, boundaries, and designation	Verify matches the building permit; confirms the building is within the permitted footprint

STOP: A developer who asks you to sign a preliminary agreement or pay a deposit before a building permit has been issued is asking you to commit your money to a project that has not yet received regulatory approval to be built. This is one of the clearest early warning signs that payment protection is inadequate or that the project has fundamental uncertainties.

Step 8 Investigate Mortgages and Encumbrances on the Property Under Construction

Know what the bank knows

As noted in Step 6, a construction mortgage on the land is common. But the mortgage situation may also extend to the building under construction or specific units within it. Understanding the full picture of encumbrances — and the mechanism for their discharge — is essential for any off-plan buyer.

Conduct a Property Register search specifically on the construction project — this shows any encumbrances registered against the building or specific units

Obtain the developer’s written confirmation of which bank(s) hold mortgage security on the project and on what specific assets (land, building, units)

Request the bank’s standard letter confirming its mortgage discharge mechanism — how individual apartment titles will be released from bank security upon payment

Verify that the preliminary agreement’s payment terms are structured so that each payment milestone triggers a proportionate release of the apartment from bank security

If the project uses a ring-fencing arrangement: verify this arrangement has been formally agreed with the bank; your lawyer obtains written confirmation

Check for any additional enforcement proceedings registered against the building project by creditors other than the construction finance bank

Step 9 Verify Act 16 for Completed Buildings — or Contractual Commitment for Future Issuance

The non-negotiable completion certificate

For a building that is already constructed at the time of purchase, Act 16 must exist and must be verified before completion. For a building still under construction, the preliminary agreement must contain a clear commitment from the developer to obtain Act 16 and specific consequences for failure to do so.

Document	Stage	What It Confirms	Can You Buy Before This Stage?
Building Permit (Разрешение за строеж)	Pre-construction	Construction is legally authorised to begin	Only with maximum caution; permit must be in place before deposit is paid
Act 14 (Протокол образец 14)	During construction	Load-bearing structural work (foundations and frame) has been completed and inspected	Yes, with appropriate contractual protection; this is a construction milestone
Act 15 (Протокол образец 15)	Construction complete	The entire building has been completed; all systems installed; ready for commissioning inspection	Yes; this stage precedes Act 16 issuance; buyer is close to final delivery
Act 16 (Разрешение за ползване)	Post-construction / commissioning	The building has been inspected by the State Building Control Authority (ДНСК) and is officially authorised for habitation or use	This is the definitive final stage; do not complete the notarial purchase without Act 16

For buildings under construction, the preliminary agreement should contain:

A specific longstop date by which Act 16 must be obtained — the date from which the buyer has the right to terminate and receive a refund with interest if Act 16 is not issued

A definition of Act 16 specifically — not Act 14 or Act 15 — as the completion trigger for final payment

A buyer right to inspect the completed building before final payment — so that quality can be verified against the specification

Financial penalty provisions if the developer delivers without Act 16 or delays beyond the longstop date

An escrow or bank guarantee arrangement for the deposit and stage payments so that buyer funds are protected if Act 16 is not achieved

Step 10 Engage an Independent Lawyer Before Signing Anything

The non-negotiable final step

All nine preceding steps involve professional legal work — searching registers, interpreting documents, verifying permits, analysing financial statements, and reviewing court records. While a buyer can conduct preliminary research independently, the complete developer due diligence process requires an independent lawyer who has no connection to the developer, the agent, or any other party in the transaction.

The lawyer’s role in an off-plan purchase is more extensive than in a resale purchase because the subject matter is more complex: there is a building that does not yet exist, a developer whose financial position must be assessed, a construction timeline that must be contractually protected, and payment protection arrangements that must be legally adequate. The preliminary agreement for an off-plan purchase is significantly more complex than a resale preliminary agreement and requires expert review before signing.

What the Independent Lawyer Does	Why It Cannot Be Done by the Agent or Developer’s Team
Conducts all register checks (Commercial, Property, Court)	The agent and developer’s team would not investigate and disclose information that might prevent the sale from proceeding
Reviews and advises on the preliminary agreement	A developer’s template preliminary agreement is drafted entirely in the developer’s interest; many standard terms are unfavourable to buyers
Identifies and advises on payment protection mechanisms	Escrow, bank guarantee, and release mechanisms are legal structures that require legal analysis to assess their adequacy
Verifies permit validity and status	Marketing materials present permits optimistically; independent verification requires direct registry access
Advises on land title and mortgage discharge mechanics	The developer’s sales team will not explain how their bank’s mortgage affects buyer title transfer — your lawyer must
Reviews the SPV structure and parent guarantee	An SPV-backed project requires assessment of whether the parent guarantee is actually enforceable and financially meaningful
Monitors the transaction to completion	Stage payment triggers, construction milestone verification, and final Act 16 check all require legal oversight

The Complete Red Flag List — When to Stop the Transaction

Developer refuses to provide building permit, land title, or financial information — Halt immediately. They have something to hide; no legitimate developer has reason to withhold these documents. Recommended Action: Walk away; there is no basis for proceeding without this information.

No valid building permit exists at the point of deposit request — Halt immediately. Construction is not legally authorised; the project may never be built. Recommended Action: Do not pay any deposit until the building permit is issued and verified by your lawyer.

Company is registered within the last 12 months with no track record — Very High. No evidence of ability to deliver; maximum financial risk. Recommended Action: Require maximum payment protection; escrow with independent third-party bank; or withdraw.

Multiple completed projects have not received Act 16 — Very High. Pattern of regulatory non-compliance; high likelihood of same outcome on new project. Recommended Action: Withdraw unless there is a compelling explanation and strong contractual protection with enforceable guarantees.

Active enforcement proceedings by tax authority or bank — Very High. Developer is in financial distress; creditors may move against project assets. Recommended Action: Withdraw until enforcement proceedings are fully resolved.

Multiple unresolved buyer disputes in court — Very High. Developer does not honour its commitments to buyers; your situation is likely to be the same. Recommended Action: Withdraw; no amount of contractual protection replaces a developer who refuses to comply.

Land plot has unresolved mortgage and no clear discharge mechanism in the contract — Very High. Buyer title may not be clean at completion; bank may have priority claim over buyer. Recommended Action: Do not complete without a legally enforceable discharge mechanism reviewed by your lawyer.

Price significantly below comparable market — High. Quality, legitimacy, or financial viability of the project may be compromised. Recommended Action: Investigate the reason for the discount before proceeding; do not treat price as a substitute for due diligence.

Urgency to sign before your lawyer has completed review — Very High. Someone does not want your lawyer to find what due diligence would reveal. Recommended Action: Insist on adequate time for legal review; 1–2 weeks minimum; any developer who refuses is demonstrating the reason to be cautious.

SPV structure with no identifiable parent or unenforceable guarantee — High. Buyer has no recourse beyond a shell company with no assets if the project fails. Recommended Action: Require independent escrow for all payments; or withdraw.

The Master Developer Due Diligence Checklist

Section A — Company Legal Checks

Commercial Register (ТР) extract obtained — confirm company name, registration date, shareholders, directors, and capital

Financial statements for last 2–3 years reviewed by your lawyer — revenue, profitability, debt levels assessed

Enforcement proceedings search conducted — no active tax authority or bank enforcement against the company

Court litigation search — volume and nature of disputes assessed; buyer disputes in particular reviewed

Company not in liquidation, insolvency, or judicial administration proceedings

If SPV structure: parent company fully analysed; parent guarantee legally reviewed and confirmed enforceable

Section B — Land and Building Checks

Property Register extract for the land plot — confirmed owner; no unresolved third-party claims

Building permit (Разрешение за строеж) verified as valid, current, and not under appeal

Approved construction drawings reviewed — confirmed your unit matches the approved design

Mortgage on land plot identified and discharge mechanism confirmed in writing with the bank

No additional enforcement proceedings against the property or project

Cadastre designation confirmed as permitting the intended construction

Section C — Track Record and Project Quality

Minimum 2 completed prior projects identified

Act 16 verified for each prior completed project

Delivery timeline of prior projects compared to contracted timeline — delays of more than 12 months are a material risk signal

Physical inspection or local review of at least one completed building — quality matches advertised specifications

No pattern of buyer disputes over quality, delivery, or deposit refusal in prior projects

Section D — Contractual Protection

Preliminary agreement reviewed by your independent lawyer before signing

Building permit (not Act 14 or Act 15) required as a condition of any deposit payment obligation

Act 16 defined as the completion trigger for final payment

Longstop date defined — buyer right to terminate with full refund if Act 16 not obtained by this date

Financial penalties for delay specified and enforceable

Payment protection mechanism adequate — escrow, bank guarantee, or notarially secured ring-fencing

Buyer right to inspect completed building before final payment confirmed

Special Purpose Vehicles (SPVs) — The Project Company Structure

How to Assess Risk When the Developer Uses a Separate Project Company

Many of Bulgaria’s most established and reputable property developers use a SPV (Special Purpose Vehicle) structure — registering a separate company specifically for each project. This is a legitimate and common practice in real estate development worldwide, used for financial ring-fencing, investor accounting, and liability management.

The existence of an SPV is not itself a red flag. The questions to ask are: Who is behind the SPV? What are the guarantees or support arrangements from the parent or developer group? And is the SPV sufficiently funded to complete the project independently?

SPV Assessment Factor	Positive / Low Risk	Concerning / High Risk
SPV backed by an established parent development company	Parent has verifiable track record; parent guarantee is explicit and legally enforceable; parent’s financial position is adequate to honour the guarantee	Parent company has financial difficulties; guarantee is vague or unenforceable; parent track record cannot be verified
SPV’s own financial position	SPV has adequate capital; construction finance in place from reputable bank	SPV has minimal capital; no construction finance; entirely dependent on deposit collection from buyers
Construction finance	SPV has committed construction finance from a recognised bank; bank has assessed the project viability	No construction finance; project funded entirely from buyer deposits; no independent financial assessment
Escrow or buyer payment protection	Buyer deposit held in escrow with an independent third party; or bank guarantee in place; or ring-fencing from mortgage is legally confirmed	Buyer payment goes directly to the SPV with no protection; no escrow; no guarantee; no ring-fencing
Parent guarantee terms	Explicit written parent guarantee; covers deposit return and completion obligations; guaranteed by an entity with adequate assets	No guarantee; or vague ‘group support’ statements without legal force; or guarantor has insufficient assets

Frequently Asked Questions

The Bulgarian Commercial Register (portal.registryagency.bg) is the primary source — it provides company registration details, shareholder and director information, capital structure, financial statements, and any significant corporate events. The Bulgarian Property Register provides information about the land title and any mortgages or encumbrances. The Bulgarian court information system (court.bg) provides access to civil case records. The State Building Control Authority (ДНСК) can verify Act 16 status for completed buildings. All of these are publicly accessible, though navigating them effectively requires knowledge of the Bulgarian legal system — your independent lawyer handles this.

Partially. The Commercial Register is publicly available online in Bulgarian, and basic information (registration date, directors, share capital) is accessible without specialist knowledge. Financial statements are attached to company records. However, fully interpreting the financial position, identifying risk signals, conducting the court search, verifying permit validity, and assessing the land title all require professional legal knowledge and language capability. The practical answer is: do initial research yourself using the Commercial Register, then engage a qualified Bulgarian property lawyer for the comprehensive due diligence.

Three primary sources: the developer’s financial statements filed with the Commercial Register (show total debt levels, creditor obligations, and liabilities); the Property Register search (reveals mortgages and creditor enforcement registered against the developer’s property); and the NRA (National Revenue Agency) enforcement list (shows active tax enforcement proceedings). Court records show active debt recovery litigation. A comprehensive financial position assessment requires your lawyer to review all these sources together and synthesise the picture.

Act 16 (Разрешение за ползване) is the official certificate issued by the State Building Control Authority (ДНСК) confirming that a completed building has been inspected, meets all construction and safety regulations, and is legally authorised for use. Without Act 16, a building cannot be legally inhabited, cannot be mortgaged, may face enforcement orders, and its resale is significantly complicated. For an off-plan buyer, Act 16 is the definitive evidence that the developer has actually delivered a legally complete and compliant building. It is the completion certificate that should trigger final payment — not Act 14 or Act 15, which confirm intermediate construction stages only.

It can be — with proper due diligence and contractual protection. Off-plan purchases have been completed successfully by thousands of foreign buyers in Bulgaria, particularly by buyers of new-build apartments from established developers in Sofia and Varna. The risks are real but manageable: comprehensive developer due diligence (as described in this guide), a well-drafted preliminary agreement reviewed by an independent lawyer, and adequate payment protection (escrow, bank guarantee, or ring-fencing) collectively reduce the risk to an acceptable level. The mistakes that lead to serious problems are consistently the same: skipping due diligence, trusting the developer’s or agent’s presentation, and signing without legal review.

Through a Property Register search on the specific land plot (using its cadastre identifier). Your lawyer obtains a current Property Register extract showing the registered owner, any mortgages or pledges, any judicial seizures, and any rights of third parties (easements, pre-emption rights). The developer should be able to provide the cadastre identifier of the land; if they cannot or will not, this is itself a concern. The land title check is separate from the commercial company check and must be done specifically on the plot under development.

Yes — absolutely. Construction finance mortgages on the land and/or building under construction are very common in Bulgarian real estate development. They are not inherently problematic, but you need to understand what happens to the mortgage when your apartment is transferred to you. The standard arrangement is for the bank to release individual apartment titles from the mortgage security upon sale, based on a pre-agreed framework. Your preliminary agreement must specify this mechanism, and your lawyer must verify with the bank that the release mechanism actually applies to your specific unit.

An SPV structure is common and can be legitimate — provided the analysis extends to the parent company and the support arrangements. Key questions: Is there an identifiable and financially sound parent company backing the SPV? Is there a written, legally enforceable guarantee from the parent covering completion and deposit return? Does the SPV have construction finance from a reputable bank, or is it entirely dependent on buyer deposits? If the answers are satisfactory, the SPV structure is manageable. If the SPV is a standalone shell with no backing and no construction finance, payment protection arrangements become critical.

Yes. The Bulgarian Commercial Register (portal.registryagency.bg) and the Property Register (icadastre.bg for cadastre; imotniregistri.bg for encumbrances) are publicly accessible without registration. The interface is in Bulgarian, but the basic information is retrievable. Comprehensive search and interpretation requires either Bulgarian language capability or professional assistance. Bulgaria For Business VCC conducts all required registry searches as part of the developer due diligence service for foreign buyers.

Yes — and this cannot be overstated. The preliminary agreement for an off-plan purchase is a binding contract that commits your deposit funds and defines your rights if the developer fails to deliver. Developer template agreements are written by developers’ lawyers to protect the developer’s interests. Key provisions — longstop dates, deposit return triggers, Act 16 as completion, delay penalties, and payment protection — are often absent or inadequately defined. A review by your independent lawyer before signing is not an optional extra in an off-plan transaction; it is the primary tool for ensuring the agreement actually protects you.

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Bulgaria For Business VCC — Your Trusted Partner for Business Expansion into Bulgaria and the European Union. All information is provided for general guidance purposes. For advice specific to your situation, please consult our team directly.