Protection of employees which was given strong support by
Bulgarian Parliament led to difficulties in closing M&A
transactions
Employment law changes enacted on 22 December 2017 and entering
into force on the same day heavily affected M&A transactions in
Bulgaria. According to the amendments, shares in a Bulgarian
limited liability company may be transferred to non-shareholders
only if the company proves it has no overdue obligations for
salaries, compensations and social security payments to its
employees. The same restriction was introduced for the sale of a
company's enterprise (i.e. the pool of the company's
rights, obligations and factual relations). The protection extends
to employees whose agreements with the company have been terminated
within three years prior to the anticipated transfer date. The
three year period was introduced to cover the limitation period for
claims under employment agreements. The amendments, however, allow
the parties to an enterprise
