Bulgarian ETFs
Last Updated on September 1, 2024 by Bulgarian Citizenship Team
Why should you consider buying the ETFs through a Bulgarian-based brokerage firm
When this article was first published in April 2021, we recommended investing in Bulgarian Funds through a local brokerage firm, a suggestion we now consider misguided. The optimal approach is to avoid intermediaries, brokerage firms, and unnecessary advice. Investors can directly invest in Bulgarian Funds without paying broker commissions. For example, investing in AIF Funds involves a simple wire transfer labeled “transfer for buying Fund shares” and signing legally required documents, including a service agreement, categorization test, and necessary declarations.
Below is the original text from the 2021 article:
Clients can buy ETFs abroad using their local brokerage firm or bank. However, the process will be more cost- and time-efficient if the ETFs are purchased locally through a Bulgarian-based brokerage firm. Alternatively, you can choose to invest in Alternative Investment Funds (AIFs) by depositing your investment directly into the Fund’s bank accounts, thereby avoiding intermediaries and saving on fees.
If you buy the ETFs through a Bulgarian-based brokerage firm, you will benefit in the following ways:
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No apostille or embassy certification of the ETF purchase confirmations is required. For example, if you buy the ETF through a bank or brokerage firm in Singapore, you will need to legalize the confirmations by the Singapore Academy of Law and then courier it to the Bulgarian embassy in Indonesia for certification (this is because Bulgaria has no embassy or general consulate in Singapore). The documents certified by the Bulgarian embassy in Indonesia will be couriered to Bulgaria where further translation and notarization will take place.
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The apostille service is not provided by your bank. In most cases, this service is offered by private firms that specialize in translation and legalization. Even a highly reputable bank in Switzerland may face difficulties arranging an apostille on your behalf through a third party. However, when purchasing ETFs through a Bulgarian-based brokerage firm, your only obligation is to sign a contract, which can be done electronically using an electronic signature.
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Most brokerage firms do not automatically include the specific wording that meets the requirements of the Bulgarian Investment Agency. This necessitates requesting particular wording on the documents or editing the documents they have already issued for you. This process is time-consuming and increases the risk of miscommunication and further delays in obtaining Bulgarian citizenship by investment.
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Bulgarian brokerage firms have extensive experience in producing the exact documents required by the Investment Agency. Additionally, documents issued by Bulgarian authorities and private firms do not require legalization or certification, which further reduces processing time. Alternatively, you can bypass brokerage firms altogether by investing directly in AIFs.
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Our service fees to assist you in obtaining Bulgarian citizenship by investment are lower if you purchase locally as it saves professional time.
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Non-EU tax residents must pay 10% on the capital gains of ETFs. For example, if you invest 1,000,000 EUR in ETFs and later sell them for 1,020,000 EUR, you will pay 10% on the 20,000 EUR gain, resulting in a 2,000 EUR tax. Our firm can assist you in becoming a Bulgarian tax resident, allowing you to declare and pay taxes in Bulgaria, where you would pay 0% capital gains tax on your ETF investment.
If you decide to buy AIFs or ETFs abroad, you can still rely on our support throughout the process of obtaining a Bulgaria Golden Visa .
