A partnership limited by shares is established by a contract and shares issued for the contributions of limited liability partners. For partnerships limited by shares, the provisions for joint-stock companies are applied. PLS is regulated in the Articles 253 to 260 of the Commercial Code. The partnership limited by shares is a capital company – a hybrid between the joint stock company and the limited partnership.
The firm name of the company shall contain the words "partnership limited by shares" or the abbreviation "PLS". Two types of shareholders take part in partnerships limited by shares: general partners and limited partners whereby the latter ones bear liability only for the company's obligations. According to Article 253 (1) of the Commercial Code, there must be a minimum number of three limited partners. The limited partners are entitled to subscribe for shares and to take advantage of all shareholder's rights, though they do not have right to vote in the general meeting. A partnership limited by shares is managed by a Board of Directors. The Board of Directors consists of full liability partners.
Necessary documents for Register a partnership Limited by shares in Bulgaria
The general partners are responsible for company formation. It takes place in two stages:
- The conclusion of a written and notarially certified Article of agreement between the general partners. At this stage, the articles of incorporation are elaborated and the general meeting is
- At the second stage, shareholders are considered for the general partners to choose limited partners.
The partnership limited by shares is organised just as the joint stock company with the single-stage management system – there are members of the general meeting and the board of directors. The difference is in the filling the bodies: regarding the partnership limited by shares, the general meeting consists of general partners and limited partners who have subscribed shares. In this context, their responsibilities become defined. The general meeting is entitled to amend the Articles of Incorporation and to decide on the dissolution of the partnership only with the consent of the general partners and the shareholders. To transform partnership, the unanimous resolution of the general partners and a resolution of the general meeting amounting to at least ¾ of the shareholders is required.
Registration in the Commercial Register
It is the general partner's exclusive right and duty to manage the business and to represent the association. The limited partners in trust are excluded from these tasks and may not contradict the general partners.
Relations to third parties
If an authorized limited partner in trust closes a business deal in the name and for the account of the company, he/she is personally liable. This is not applicable, if the association confirms the business deal has closed by the limited partner in trust.
According to Article 107 BHG (in conjunction with Article 83 BHG), the general partner is prohibited to take part in competition.
Taxes
The partnership limited by shares is subject to the corporate tax which takes 10 % of the gains of the association. If dividends are paid to the members of the association, the paid amount is assessed with a withholding tax of 5%. If there are foreign associates, the respective conventions created to prevent double taxation must be respected.
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
