AIFM passporting in Bulgaria

An AIFM, authorised by the competent authority of its home State may manage and market AIFs in Bulgaria directly and / or through a branch provided that a notification is sent by the competent authority of its home State to the Bulgarian Financial Supervision Commission (“FSC”), accompanied by the documents specified in the Collective Investment Schemes and Other Undertakings for Collective Investments Act (“CISOUCIA”), and a confirmation that the AIFM is licensed by the competent authority of its home State.

Regardless of whether an existing passport to conduct management business under another single market directive (such as UCITS) is held, EEA AIFMs are required to make a separate notification to their home State competent authority if they intend to manage or market AIFs on a passported basis.

AIFMs marketing AIFs in Bulgaria are allowed to do so only to professional investors. Marketing to non-professional investors within Bulgaria is permitted only  in compliance with the requirements applicable to national investment funds (a sub-type of AIFs for collective investments in transferable securities and other liquid financial assets), which involves the approval of a prospectus.

AIFMs established in Non-EEA jurisdictions may market in Bulgaria AIFs not offered in other EEA jurisdictions provided that certain requirements are met. Such requirements include, amongst others, that (i) the AIFM complies with the requirements of the CISOUCIA; (ii) cooperation arrangements are in place between Bulgaria and the AIF’s and / or AIFM’s country of origin; and (iii) the marketing by the Non-EEA AIFM has been approved by the FSC.

EEA AIFMs may commence pre-marketing AIFs which are not yet established or established but not yet compliant with the applicable marketing procedures, to potential professional investors in Bulgaria, provided that the Bulgarian Financial Supervision Commission receives a pre-marketing notification letter within two weeks of starting such pre-marketing activity. EEA AIFMs need to send this pre-marketing notification letter to their home State competent authority within two weeks of starting such pre-marketing activity, which in turn is directly transmitted to the Bulgarian Financial Supervision Commission.
The information provided to potential professional investors within the context of the pre-marketing activity should:

• not enable such investors to commit to acquiring units or shares of the pre-marketed AIF;
• not amount to a subscription form or similar document, whether in draft or final form;
• not include an incorporation deed or articles of association, prospectus or an offer for AIF, which is not created in a final form of the said documents.

For a period of 18 months after the start of the pre-marketing of the AIF, the AIFM may not rely on reverse solicitation in the jurisdiction where the pre-marketing has been notified.

Pre-marketing by Non-EEA AIFMs has not been provided for in the applicable legislation in Bulgaria.

The FSC tariff provides for (i) a one-off license fee of EUR 4,000, and (ii) an annual supervision  fee which varies depending on the type and the scope of the license/registration of the AIFM and the number of the managed fund.