YARD Law Co. · Dispute Resolution & Enforcement · July 2026 · YARD Law Legal Team
When a Bulgarian customer stops paying a foreign supplier, the first question is usually whether another demand letter will make a difference.
Sometimes it will. More often the important question is a different one: whether the debtor will still own anything by the time a judgment exists.
The answer to that question determines the sequence of everything else, so it belongs at the beginning of the file rather than at the end.
The unpaid amount is only part of the case. Before proceedings are started, the commercial relationship has to be reconstructed: contract, orders, invoices, delivery documents, credit notes, bank transfers, correspondence, acknowledgements, partial payments and repayment proposals.
A strong recovery case is not a folder of invoices. It has to show why the money became due, what was actually supplied, whether the debtor disputed performance, and whether later conduct confirms the debt.
Documents never drafted as legal instruments frequently decide these cases. An email proposing a repayment schedule, a partial payment, a credit note referring back to the original invoice - each can matter, and none should be assessed in isolation.
Two limitation points to check at the same time. The general limitation period under чл. 110 ЗЗД is five years. Claims for interest and other periodic payments are subject to the shorter three year period under чл. 111 ЗЗД. A claim that has been sitting in a foreign accounts department for four years needs a limitation assessment before anything else is decided.
Bulgarian procedure offers a fast, document-based route that is not a full lawsuit: заповедно производство, the order for payment procedure.
Under чл. 410 ГПК a creditor applies to the district court at the debtor's seat for an order for payment. The court does not examine the merits in an adversarial hearing. If the application is in order, the order is issued and served on the debtor.
Under чл. 417 ГПК, where the claim is based on one of the listed categories of document, the creditor can obtain an order for immediate enforcement together with a writ of execution, which means enforcement can begin before the debtor has had the opportunity to contest anything.
The catch is the objection. The debtor may object without giving reasons, within the period running from service, and that period cannot be extended. An objection does not require the debtor to prove anything - it simply shifts the matter into ordinary claim proceedings, in which the creditor must bring an establishing claim within the period the court sets, failing which the order is annulled.
For a creditor with clean documents against a debtor who is simply not paying, this is the shortest and cheapest route. For a creditor facing a debtor who will certainly object, it is a month lost. The choice depends on what is known about the debtor's willingness to litigate, which is a factual assessment rather than a procedural one.
Before filing in Bulgaria at all, four things have to be checked.
There is also a purely European alternative to the Bulgarian order for payment. Regulation (EC) 1896/2006 creates the European Order for Payment, available for cross border claims and enforceable in other Member States without exequatur. For a creditor outside Bulgaria with a straightforward claim it is worth comparing against the чл. 410 ГПК route rather than assuming the domestic procedure is the only option.
Usually, but not mechanically.
A formal demand can put the debtor in default, fix the creditor's position, start interest running under чл. 86 ЗЗД, produce a further acknowledgement, and demonstrate reasonableness before litigation. The Commercial Act also implements the EU late payment regime for commercial transactions, which affects payment terms and the creditor's entitlement to interest and collection costs.
But there are cases where repeatedly warning a debtor simply gives it time to move assets. Where the financial condition of the Bulgarian company is deteriorating, the sequence should be reversed: secure first, demand afterwards.
Bulgarian procedure allows security both for a pending claim (чл. 389 ГПК) and for a future claim not yet filed (чл. 390 ГПК). Where security for a future claim is granted, the court fixes the period within which the substantive claim must be brought, and the security falls away if it is missed.
The measures available include attachment of bank accounts and receivables, attachment of movable property, and a prohibition against disposal registered over real estate. The court examines whether the statutory conditions are met and may require a guarantee as a condition of granting the measure.
There is a separate European route for bank accounts specifically. Regulation (EU) 655/2014 creates the European Account Preservation Order, available before, during or after substantive proceedings, obtained without notice to the debtor. The Bulgarian procedural provisions implementing it are чл. 618а to чл. 618д ГПК. It is confined to bank accounts, but for a foreign creditor facing a debtor with accounts in more than one Member State it can do what a Bulgarian domestic measure cannot.
One trap worth knowing. The Court of Justice has held that a Bulgarian order for payment under чл. 410 ГПК which has not entered into force does not qualify as an authentic instrument for the purposes of the Regulation. A creditor cannot obtain an order for payment on Monday and treat it as a European enforceable title on Tuesday.
A judgment does not collect money. If the debtor does not pay voluntarily, enforcement runs through a private or state enforcement officer, and can target bank accounts, receivables from third parties, movable assets, real estate, corporate interests and other attachable property.
Under Regulation (EU) 1215/2012, a judgment given in one Member State is enforceable in another without a declaration of enforceability, which removes a stage that used to add months.
The point that matters most is that asset investigation belongs at the start of the file, not after judgment. Enforcement against a company that has already been emptied is an expensive way of confirming a bad outcome.
Where assets have already been moved, that is not necessarily the end. Bulgarian law provides a creditor with an action to have transactions prejudicial to the creditor declared ineffective as against it (чл. 135 ЗЗД). Transfers at conspicuously undervalued prices to related parties are the classic target. This is a distinct claim with its own requirements and its own limitation position, and it needs to be assessed as soon as the transfer is discovered. Our procedural roadmap of commercial debt recovery in Bulgaria sets out the stages in more detail.
The strategy changes completely, and the deadlines become unforgiving.
Claims must be filed within one month of the entry in the Commercial Register of the decision opening insolvency proceedings (чл. 685, ал. 1 ТЗ). There is an additional period of not later than two months after expiry of that period (чл. 688, ал. 1 ТЗ), but a creditor filing in the additional window is in a materially worse position. After the additional period expires, claims arising before the opening of proceedings cannot be filed at all.
These are preclusive periods, not limitation periods. They do not stop for a foreign creditor who did not know, and no Bulgarian court will telephone a creditor abroad to explain them.
Cross border insolvency within the EU is governed by Regulation (EU) 2015/848, which determines where main proceedings can be opened and how foreign creditors are to be informed and lodge claims.
Security obtained before insolvency can still be highly relevant, but its effect has to be analysed in the insolvency context rather than assumed to survive intact.
A foreign creditor filing in Bulgaria will need its corporate documents and any power of attorney in a form Bulgarian courts accept. Depending on the country of origin that means an Apostille or fuller legalisation, and a Bulgarian translation meeting the applicable formal requirements. This is a lead time item, not an afterthought, and it should be started in parallel with the evidence review rather than after the decision to sue. We work with foreign clients in English throughout - see how we act for foreign clients in Bulgaria.
Not "can we sue?" but "if we sue and win, what will be available for enforcement, and what has to be secured before the debtor knows we are coming?"
We act for Bulgarian and international creditors in commercial recovery, interim security, enforcement and litigation and insolvency. For substantial claims our first step is normally an evidence and recovery assessment rather than immediately issuing proceedings.
To discuss a Bulgarian debtor, write to [email protected].
This article provides general information on Bulgarian procedure and EU instruments as at July 2026 and should not be relied upon as legal advice in a particular matter. Prepared by the legal team at YARD Law Co., a law firm based in Sofia, Bulgaria, acting for domestic and international clients in commercial disputes, enforcement and insolvency.
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