Insolvency in Bulgaria: Downsides Creditors may Encounter

The general legal framework of existing Bulgarian insolvency law covers the core features recognised by the international insolvency community and takes account of EC Regulations and Directives. On the other hand, it does not always achieve the proper balance between the need to address the debtor's financial difficulty as efficiently as possible and the interests of the creditors.

This article highlights some inefficiencies of the existing Bulgarian insolvency regime compared with international best practices.

Scope

No collective insolvency proceedings are in place with respect to natural persons unless they are operating as sole proprietors. Individuals that do not conduct economic activities by themselves may not be discharged from their liabilities in order to have a fresh start.