Bulgaria: Law of Offshore
Law on Free Zones
Bulgaria has a number of Free Trade Zones. These are located close to major transport routes. Free Trade Zones are located on the border with Serbia, another on the Turkish border, and in Plovdiv. There are further zones located at seaports. The Free Trade Zones allow the movement and storage of goods without incurring excise duties and VAT, subject to certain conditions. Bureaucracy is also kept to a minimum for those companies operating in these zones.
The following are relevant extracts from Bulgarian law on Free Trade Zones, The Customs Act:
TITLE THREE – OTHER CUSTOMS ASSIGNMENTS
CHAPTER NINETEEN – FREE ZONES AND FREE WAREHOUSES
Section I. General Provisions
Article 166. Free zones and free warehouses shall be separate parts of the customs territory of the Republic of Bulgaria or premises situated in that territory in which:
- for the purpose of import customs duties and trade policy importation measures foreign goods are considered as being outside the customs territory of the Republic of Bulgaria provided they have not been placed under import regime or another customs regime and have not been used or consumed in contravention to the customs regulations;
- local goods may use the measures applicable for exportation of goods if this is provided for in another act or instrument of the Council of Ministers.
Section II. Placing Goods in Free Zones or Free Warehouses
(1) Both local and foreign goods may be placed in a free zone or a free warehouse.
(2) The customs authorities shall be entitled to require that goods which present a danger or are likely to damage other goods or which require special preservation conditions be placed in premises or locations specially equipped for such goods.
Section III. Operation of Free Zones and Free Warehouses
(1) There shall be no limit to the length of time goods may remain in free zones or free warehouses.
(2) Time limits may be specified in the Regulations for some goods remaining in free zones or free warehouses.
(1) Any industrial and commercial activity as well provision of services shall be authorized in a free zone or a free warehouse in compliance with the provisions herein. The carrying out of such activities shall be notified in advance to the customs authorities.
(2) The customs authorities shall be entitled to prohibit or restrict the activities referred to in Paragraph 1, depending on:
- the nature of the goods concerned;
- the requirements of customs supervision.
(3) The customs authorities shall be entitled to prohibit persons who do not observe the provisions herein from carrying on an activity in a free zone or a free warehouse.
Section IV. Removal of Goods from Free Zones or Free Warehouses
(1) In compliance with the special customs regulations, goods leaving a free zone or free warehouse may be:
- exported or re-exported from the customs territory of the Republic of Bulgaria;
- brought into another part of the customs territory of the Republic of Bulgaria.
(2) With the exception of Articles 55 to 60 relating to local goods, the provisions of Part Three shall apply also to goods brought into other parts of the customs territory of the country from free zones and free warehouses. These provisions shall not apply to goods which leave the free zone by sea or air without being placed under a transit or another customs regime.
(1) When a customs debt occurs in respect of foreign goods whose customs value is formed on the basis of a price actually paid or payable and which includes the cost of warehousing or preserving goods while they remain in the free zone or the free warehouse, such costs shall not be included in the customs value provided they are shown separately from the price actually paid or payable for the goods.
PART FIVE – CUSTOMS REBATES
CHAPTER TWENTY-ONE – EXEMPTION FROM CUSTOMS DUTY
(1) The cases of granting exemption from customs duty both in exportation and importation of goods shall be specified in the Regulations.
(3) No exemption from customs duties shall be allowed for goods sold within the customs control zones in the border checkpoints, except for:
- the usual supplies of fuel and products for ships and aircraft;
- retail sale of goods in ports and airports after the customs control;
- retail sale of goods aboard aircraft and ships performing international transport;
- retail in specialized shops servicing the diplomatic corps.
PART SIX –CUSTOMS DEBT
CHAPTER TWENTY-FOUR – SECURITY TO COVER CUSTOMS DEBT
- When applying customs rules, the customs authorities shall require security for customs debt to be provided; such security shall be provided by the person who is liable or who may become liable for that debt.
- The customs authorities shall require only one security to be provided in respect of one customs debt.
- The customs authorities may allow that the security be provided by a person other than the person that is required.
- When the person who has incurred or who may incur a customs debt is a public or a local authority, the Director of the Customs Agency may exempt the said person in whole or in part of the obligation to provide security.
- The customs authorities may waive the requirement for provision of security for insignificant sums the amount of which shall be specified in the Regulations.
CHAPTER TWENTY-FIVE – OCCURRENCE OF A CUSTOMS DEBT
(1) An import customs debt shall occur for goods subject to customs duties through:
- processing under the import regime;
- placing under the temporary import regime with partial exemption from import customs duties;
- unlawful introduction into the customs territory of the Republic of Bulgaria in contravention to the provisions under Articles 45 to 48;
- unlawful introduction into another part of the country's customs territory of goods located in free zones or free warehouses in contravention to the provisions set forth in of Article 177, Paragraph 1, Item 2;
- evasion from customs supervision;
- non-compliance with one of the requirements arising in case of temporary storage or of using of the customs regime;
- non-compliance with one of the conditions governing the placing of the goods under the respective customs regime or the granting of a reduced or zero rate import duty or exemption from customs duties by virtue of the use of the goods for specific purposes;
- consumption or use in a free zone or in a free warehouse under conditions other than those laid down by the legislation in force. When goods disappear and when no credible evidence is presented to the customs authorities it shall be deemed that the goods have been consumed or used in the free zone or the free warehouse;
- issue of documents necessary to grant preferential treatment in third countries to goods with Bulgarian origin when agreements concluded between the Republic of Bulgaria and these countries provide for the payment of customs duties due for the foreign goods input.