Partner & Shareholder Rights Bulgaria | Protection, Claims, OOD & AD

Q: What rights do I have as a minority partner?

Right to information (Art. 123); right to request convening of the GA at 1/10 of the capital; right to challenge GA decisions (Art. 74); right to request judicial dissolution at 1/5 of the capital.

Q: Can I request distribution of profits?

The GA is not obliged to distribute profits. If the majority partner systematically blocks distribution, this may constitute grounds for a claim under Art. 71 or dissolution under Art. 155(1).

Q: Under what conditions can I request judicial dissolution?

Partners holding more than 1/5 of the capital may request dissolution for important reasons (Art. 155(1)) — persistent conflicts, management paralysis, abuse of majority position.

Q: What are the differences in rights protection between an OOD and an AD?

In an OOD, broader information rights and direct access to books. In an AD, more formalised protection but more minority instruments. OOD partners may withdraw with notice; AD shareholders cannot.

What you will learn in this article

What property and non-property rights you have as a partner in an OOD under Art. 123 of the Commercial Act
What rights you have as a shareholder in an AD and how they differ from those in an OOD
How to challenge a General Assembly decision under Art. 74 and within what deadline
How to protect your membership rights with a claim under Art. 71
What special protection instruments are available to minority partners and shareholders
What practical steps to take when your rights have been violated

Rights of partners in an OOD (Art. 123 Commercial Act)

Property rights

Right to a share of profits (dividends). Every partner has the right to receive a share of the distributed profits, proportional to their interest in the capital (Art. 123(1) read with Art. 133). The General Assembly is not obliged to distribute profits.

Right to a liquidation quota. Upon termination and liquidation, each partner has the right to a share of the assets remaining after all creditors have been satisfied.

Right to the value of the interest upon departure. A partner who terminates their participation has the right to receive the cash equivalent of their interest, determined on the basis of the balance sheet.

Non-property rights (management and control)

Right to participate in management. The partner participates in the General Assembly and votes on all matters within its competence. Voting rights are proportional to interests in the capital.

Right to information and control. The partner has the right to be informed about the company’s affairs, inspect the books, and request explanations from the manager (Art. 123(1)). Send a written request to the manager specifying the documents and information you wish to obtain. In case of refusal, you may bring a claim under Art. 71.

Right to request convening of the General Assembly. Partners holding interests representing more than 1/10 of the capital may request the manager to convene a General Assembly (Art. 138(2)). If the manager fails to do so within 2 weeks, the partners may convene it themselves.

Rights of shareholders in an AD

Shareholders in an AD enjoy analogous, but not identical, rights. The principal property rights are: the right to dividends, the right to a liquidation quota, and the pre-emptive right to subscribe for new shares. Non-property rights include the right to vote, the right to information, and the right to participate in management.

Specifics for AD:

Voting rights are attached to the share, not the person — one share carries one vote (except for preference shares without voting rights)
Right to information is more formalised — shareholders receive materials for the agenda items before the meeting
Minority protection is more developed — shareholders holding at least 5% of the capital have additional rights
Cumulative voting — when electing Board members, shareholders may cumulate their votes for one candidate

Challenging General Assembly decisions (Art. 74 — 14 days)

Where the General Assembly adopts a decision that contravenes the law or the articles of association, any partner or shareholder may seek its annulment by the court.

Deadlines. The claim must be brought within 14 days of learning of the decision, but no later than 3 months from the date of the General Assembly. These deadlines are preclusive.

Grounds for challenge:

Violation of the law — a decision taken without the required majority; a General Assembly convened without invitation; voting on items not included in the agenda
Violation of the articles of association — a decision taken in breach of clauses in the articles (e.g., restrictions on asset disposal, special majorities)

Jurisdiction. The claim is brought before the district court at the company’s registered seat. The court fee is EUR 40.90.

Effect. Filing a claim does not automatically stay execution. The claimant may request an interim measure — staying execution pending the outcome.

Claims against company bodies (Art. 71 Commercial Act)

Art. 71 grants every partner or shareholder the right to bring a claim to protect their membership rights where they have been violated by an act or omission of the company’s bodies.

What may be sought:

Cessation of the violation — an order for the body to cease actions violating membership rights
Compensation for damages — monetary compensation for losses suffered
Declaration of the violation — a court judgment establishing that a specific action is unlawful

Art. 71 vs Art. 74 — comparison

Criterion	Art. 71	Art. 74
Subject matter	Acts / omissions of company bodies	General Assembly decisions
Deadline	General limitation — 5 years	14 days from learning, max. 3 months
Court fee	EUR 15.34–40.90	EUR 40.90
Outcome	Cessation, compensation	Annulment of the decision

Practical examples:

The manager refuses to provide information despite a written request
The manager fails to convene the General Assembly despite a request from partners holding more than 1/10 of the capital
The manager enters into transactions that directly damage a specific partner’s interests

Minority protection

Threshold of 1/10 of the capital:

Right to request convening of the General Assembly (Art. 138(2)) — if the manager fails to do so within two weeks, the partners may convene it themselves
Right to add items to the agenda of an already convened General Assembly

Threshold of 1/5 of the capital:

Right to request judicial dissolution of the company where there are important reasons (Art. 155(1)) — persistent conflicts between partners, management paralysis, abuse of the majority position

Derivative claim (actio pro socio). In certain situations, a partner may bring a claim on behalf of the company against the manager for damages.

Protection against “dilution.” If the General Assembly adopts a capital increase under conditions placing the minority at a disadvantage, the partner may challenge the decision under Art. 74.

Comparison: OOD vs AD on rights protection

Criterion	OOD	AD
Right to information	Broad — direct access to the books (Art. 123)	More formalised — through GA and public reports
Challenging GA decisions	Art. 74 — 14 days	Art. 74 — 14 days (identical)
Convening the GA	1/10 of the capital	5% of the capital
Judicial dissolution	1/5 of the capital (Art. 155(1))	Not available
Transfer of interests / shares	Notarial certification + registration	Free transfer (endorsement for registered shares)
Withdrawal with notice	Yes — 3 months (Art. 125)	No — only sale of shares
Cumulative voting	No	Yes

Practical steps when your rights are violated

Step 1: Document the violation. Collect all evidence — GA minutes, correspondence with the manager, financial documents, records.

Step 2: Send a written demand to the manager. Provide an opportunity for voluntary resolution and create evidence for potential proceedings.

Step 3: Assess the appropriate legal instrument. Determine which claim is appropriate: Art. 74 (for GA decisions) or Art. 71 (for actions of company bodies). Watch the 14-day deadline under Art. 74.

Step 4: Request interim measures. If the GA decision may cause irreparable harm, request the court to stay execution.

Step 5: Consider alternatives. Convening an extraordinary GA (if you hold 1/10), negotiating a buyout, or mediation.

Step 6: Consult a lawyer. Corporate disputes are complex, and the outcome depends on the correct choice of legal instrument and strict observance of deadlines.

Frequently asked questions

What are the main rights of a partner in an OOD?

Under Art. 123, a partner has the right to a share of profits (dividends), a liquidation quota, participation in management (voting at the GA), and the right to information and control over the company’s activities. These rights are inalienable.

How can I challenge a General Assembly decision under Art. 74?

A claim is brought before the district court at the company’s registered seat. The deadline is 14 days from learning of the decision, but no later than 3 months from the date of the GA. Grounds: contravention of the law or the articles of association. Court fee: EUR 40.90.

What is a claim under Art. 71 and when can I bring one?

A claim under Art. 71 protects membership rights violated by acts or omissions of the company’s bodies. The limitation period is the general one — 5 years. You may seek cessation of the violation and compensation for damages.

Do I have a right to information about the company’s activities?

Yes, Art. 123 guarantees every partner the right to information. Send a written request to the manager specifying the documents you wish to inspect. In case of refusal, you may bring a claim under Art. 71.

What rights do I have as a minority partner?

Minority partners have: the right to information (Art. 123); the right to request convening of the GA at 1/10 of the capital (Art. 138(2)); the right to challenge GA decisions (Art. 74); and the right to request judicial dissolution at 1/5 of the capital (Art. 155(1)).

Can I request distribution of profits?

The decision to distribute profits falls within the GA’s competence (Art. 137(1)(3)). The GA is not obliged to distribute. However, if the majority partner systematically blocks distribution without justifiable reason, this may constitute grounds for a claim under Art. 71 or for dissolution under Art. 155(1).

Under what conditions can I request judicial dissolution?

Partners holding more than 1/5 of the capital may request judicial dissolution where there are “important reasons” (Art. 155(1)) — persistent conflicts between partners, management paralysis, and abuse of the majority position.

What are the differences in rights protection between an OOD and an AD?

In an OOD, the partner has broader information rights and direct access to the books; in an AD, protection is more formalised but minorities have more instruments (cumulative voting, pre-emptive right). In an OOD, the partner may withdraw with notice (Art. 125) and request dissolution; in an AD, these options are not available.

Conclusion

Protecting the rights of partners and shareholders requires knowledge of the instruments provided by the Commercial Act and strict observance of preclusive deadlines. The 14-day deadline under Art. 74 is extremely short and cannot be restored.

If you believe your rights as a partner or shareholder have been violated — timely legal assistance is critical, particularly when challenging General Assembly decisions.

This article is for informational purposes only and does not constitute legal advice. For questions specific to your situation, please consult a qualified lawyer.

Protection of Partner & Shareholder Rights in Bulgaria (OOD & AD)