Bulgaria’s law on commercial register raises risk of theft of companies – report
Bulgaria is on the verge of an “epidemic” of a theft of companies because of shortcomings in the Commercial Register Act, lawyers say, according to a report by bTV on November 24.
The report cited what it said was the latest case, in the village of Shishmantsi in the Plovdiv region, where Italian businessman Fabricio Fresci set up 14 years ago, growing tomatoes, sunflowers and wheat on a 3000 hectare plot.
About a month ago, he found out from the Commercial Register that his company had a new manager, someone he had never heard of.
Fresci immediately went to Plovdiv to file a complaint with the police division that investigates economic crimes.
Fresci’s lawyer, Ivan Marinov, said that a check with the Italian owners established that none knew about the change. Inspection of the Commercial Register showed that the change was the result of a false report of a general meeting, with five forged signatures attached.
The new “manager” had wasted no time, concluding a fraudulent contract to supply 800 tons of sunflowers to a Varna company.
The Varna company paid the 400 000 leva, the “manager” drew the money and disappeared.
Now, Fresci said, the company from Varna was looking for its money and wanted to know why it had not received any sunflowers.
The “manager” was identified as Mladen Vassilev, 35, who according to the Commercial Register was involvement in the management of nine companies. A bTV team failed to find him at his stated address in the Lyulin residential area of Sofia.
The report said that this kind of fraud was hardly an isolated case, and business people from across the country were demanding amendments to the Commercial Register Act.
At the beginning of 2014, Pavel Stoimenov’s company also was stolen with ease, and his land near Pleven sold.
He said that such changes in the Commercial Register should be permissible only if done through a notary, verifying the authenticity of documentation and requiring a declaration of payment of taxes and fees.
The report said that the main problem was that changes to the Commercial Register could be made electronically, with scanned fake documents.
The Registry Agency confirmed that each month there were attempts to steal up to a dozen companies.
The executive director of the agency, Ventsislav Spiridonov, said that company owners should protect their companies.
“It is the responsibility of the owner of the company, to carry out such checks and to protect your property, just as you check whether you locked your door when you leave your home,” Spiridonov said.
The report quoted the agency as saying that documents arriving electronically could not be checked for authenticity because agency employees were not police or graphologists.
For now, the only certain way for company owners to protect themselves was to subscribe to SMS alerts. Each time a document is submitted regarding a change in the company records, the owner receives an SMS.
Of 40 000 registered companies in Bulgaria, 4000 have signed up for the service.