Additional Cash Contributions in Bulgaria: Article 134 Guide

Additional cash contributions can give a Bulgarian OOD or EOOD temporary liquidity without increasing its registered capital. They are useful when the company has losses or a short-term funding gap, but they are not an informal instruction to “send money when needed.” Article 134 of the Commerce Act sets a corporate procedure, a fixed-term requirement, a qualified majority, and an exit protection for a member who did not support the decision.

The instrument also has tax and insolvency consequences. A well-drafted resolution should say why the funds are needed, how much each member must pay, when the company must return them, and whether interest applies. Accounting records and bank payments then need to match that decision.

This guide provides general information as at 1 August 2026. It is not legal, tax, accounting, insolvency, transfer-pricing, or investment advice for a particular company or member.

Article 134 Contributions at a Glance

What an Additional Cash Contribution Is

The Registry Agency's current Commerce Act allows an OOD's general meeting to oblige its members to provide additional cash for a defined period. The rule addresses loss coverage and temporary cash need. The safest resolution records the actual financial circumstances—such as a forecast working-capital shortfall, overdue operating liabilities, or losses that have created the need—and attaches management figures supporting the amount and term.

Article 134(3) expressly says that these payments do not change the company's capital. A member who provides 60% of an additional contribution does not gain more votes or a larger registered interest merely because of that payment. The company receives cash and incurs a repayment obligation under the resolution; it does not automatically receive permanent equity.

This distinction matters when the funds are described as “covering losses.” A cash receipt may allow the company to pay creditors, but a repayable liability does not by itself eliminate accumulated accounting losses. If the commercial objective is permanent balance-sheet repair, a capital increase, contribution to reserves where legally available, debt waiver, or another restructuring may be more appropriate and requires separate legal, accounting, and tax work.

The Resolution, Majority, and Form

Article 137(1)(9) reserves additional cash contributions to the general meeting. The resolution needs a majority of more than three quarters of the entire capital, not merely three quarters of votes represented at the meeting. The articles may demand a higher majority. In an EOOD, the sole owner records a written decision exercising the general meeting's powers.

Unlike decisions on admitting members, changing capital, appointing a manager, or disposing of real estate, an Article 134 resolution is not included in the statutory list that automatically requires minutes with simultaneous notarial certification of signatures and content. Ordinary written minutes normally suffice, unless the articles impose a stricter form.

The meeting itself must still be valid. Under the statutory default, each member receives written notice at least seven days before the meeting, with the additional contribution clearly included in the agenda. Different notice rules may appear in the articles. A surprise vote under a vague “miscellaneous” item creates avoidable challenge risk.

A usable resolution should identify:

• the concrete temporary cash need, loss position, and supporting financial information
• the total amount and exact euro amount due from each member
• whether allocation follows capital interests and the legal basis for any different allocation
• the payment deadline, company bank account, and payment reference
• the defined period and exact repayment date or objectively determinable end date
• whether interest is payable, its rate, calculation basis, and payment date
• whether early repayment is permitted and who confirms that liquidity allows it
• how any extension or changed terms must be approved

The company should not leave the duration open-ended. Repeated extensions may be possible through properly adopted decisions, but each extension should be supported by current figures. A contribution that rolls indefinitely without a real temporary purpose begins to look unlike the statutory instrument chosen.

Proportionality and the Dissenting Member's Exit

The default is that members contribute in proportion to their registered capital interests. Article 134 permits another allocation, but a disproportionate obligation needs clear wording, proper approval, consistency with the articles, and a defensible commercial reason. It should not be used as an opaque way to shift value or force a minority member into default.

A member who did not vote for the decision may terminate their participation under Articles 134(2) and 125(2)–(3). They must invoke that right within one month: from the meeting for a member who attended or was duly invited, or from notification for another member. The notice and financial settlement then follow the statutory withdrawal rules, including the relevant balance-based settlement. This is a specialised exit protection, so timing and proof of delivery matter.

A member who neither pays nor properly exercises the exit right is exposed to enforcement under the company relationship. Article 126 recognises failure to make an additional contribution as a possible exclusion ground, but exclusion is not automatic. The company must follow the warning, voting, form, and conflict rules applicable to that serious remedy. If ownership may change, our guide to transferring OOD interests explains the separate sale route.

Step-by-Step Funding Process

1. Prepare a Liquidity Paper

Management should quantify the shortfall, existing losses, intended use, available alternatives, and realistic repayment source. Use a cash-flow forecast rather than a round number disconnected from operations. Check whether the company is merely illiquid for a short period or already insolvent or over-indebted.

2. Review the Articles and Existing Finance

Confirm notice, quorum, majority, voting, and form rules. Review bank covenants, existing shareholder loans, security, subordination, dividend restrictions, and related-party policies. An additional contribution does not override a lender's negative covenant.

3. Convene and Decide

Send a specific agenda and the financial paper in time for an informed vote. Record attendance, votes, conflicts, the full Article 134 terms, and authority for the manager to receive and account for the funds. Notify absent members in a provable manner so the dissent window can be calculated.

4. Transfer and Reconcile the Funds

Use the company bank account and a payment reference tying each transfer to the dated resolution. Reconcile the amount received from every member and issue internal confirmation. Do not record the principal as sales revenue or as a registered-capital payment merely because cash has arrived.

5. Maintain the Accounting and Tax File

Keep the minutes, management forecast, allocation calculation, bank evidence, applicable accounting policy, interest schedule, related-party analysis, and foreign-owner documents together. The books should distinguish principal, accrued interest, repayment, and any later amendment.

6. Review Before Repayment

Confirm that the agreed term has expired or that early repayment is authorised, calculate interest and withholding correctly, and update the cash-flow and solvency analysis. Repayment should trace back to the same member and resolution. Article 134(3) says the special Article 73c procedure for payments connected to pledged or attached company interests does not govern return of these contributions; that does not displace insolvency, tax, or valid security rights. If the company cannot safely pay, obtain advice before extending, waiving, converting, or setting off the claim.

Additional Contribution, Capital Increase, or Loan?

A capital increase is appropriate when permanent equity and public capital change are intended. It follows stricter rules and Commercial Register entry; it is not automatically repayable. Founders can review the wider structure in our OOD registration guide.

A shareholder loan is contractual debt. It can be made by one owner without imposing matching payments on every member and can contain negotiated security, covenants, and repayment terms. Calling a bank transfer “Article 134” in its reference does not transform a bilateral loan into a valid additional contribution when the corporate decision and statutory facts are missing.

Accounting, Tax, and Hidden-Distribution Risks

Classification must follow the company's accounting framework and the transaction's substance. Because a compliant Article 134 contribution is temporary and repayable, it will commonly be tracked as a liability of the company and a receivable of the member rather than registered equity. The principal receipt and repayment should not be assumed to be taxable revenue and deductible expense; an accountant must map the actual documents to the ledger.

Interest is a separate item. The company needs documentary support for any expense, while the recipient recognises income under the rules applying to that person. The NRA's official transfer-pricing guidance explains that Bulgarian related-party rules apply the arm's-length principle. Currency, term, amount, security, borrower risk, and other conditions all affect a defensible market rate. Interest expense can also engage thin-capitalisation and interest-limitation rules.

Above-market interest, payments unrelated to business, or value otherwise diverted to a member can be treated as hidden profit distribution. The NRA's official dividend guidance includes amounts exceeding ordinary market levels paid to members or connected persons in that concept. Consequences can include tax adjustment, dividend or withholding analysis, and penalties; they are not cured by the Article 134 label. Our Bulgarian corporate-tax guide covers the wider framework.

Interest paid to a non-resident member requires a Bulgarian source-tax and treaty or EU-directive review. A tax-residence certificate, beneficial-owner evidence, and any relief procedure should be prepared before payment rather than reconstructed later. If the facts are instead treated as a loan, reporting obligations for the company or an individual member may also differ.

Insolvency and Creditor Priority

New owner funding does not cure insolvency by definition. If the company cannot pay due debts or is over-indebted, management must assess the insolvency rules; Article 626 requires an application within 30 days after insolvency or over-indebtedness arises. Funding forecasts should address both cash-flow and balance-sheet tests.

Article 134 itself gives the member no security or statutory payment priority. Without separately valid security or another legal privilege, the member would normally prove the repayment claim as an unsecured creditor and compete in the statutory distribution order. Payment to a connected member near insolvency can also be challenged under avoidance rules, with knowledge presumed in certain connected-party cases. Managers should not repay owners merely because the resolution's date has arrived if doing so prejudices creditors or leaves due debts unpaid.

Foreign Owners, Currency, and Payment Evidence

Since Bulgaria uses the euro in 2026, state the obligation and repayment in euro. If a foreign owner pays from a different currency account, specify who bears conversion and bank charges and require the exact euro amount to reach the company. Record exchange differences consistently rather than allowing each member to choose an informal rate.

Obtain the foreign owner's internal approval where required and satisfy bank KYC, beneficial-owner, sanctions, and source-of-funds checks. Cross-border payments should travel through traceable accounts. If interest is due abroad, settle withholding and treaty evidence before remittance.

Lion Consult can prepare the corporate resolution and member notices, coordinate the accounting and cross-border evidence, and flag when a capital increase, loan, restructuring, or insolvency review is more suitable. Discuss your company's funding plan with our team.

Article 134 funding depends on the company's articles, financial condition, member structure, accounting framework, and tax residence. Obtain tailored Bulgarian legal, accounting, and tax advice before approving or repaying a contribution.

Frequently Asked Questions

What is an Article 134 additional cash contribution?

It is temporary funding imposed on OOD members by a properly adopted general-meeting decision to address losses and a temporary cash need. It does not increase registered capital or ownership percentages.

What majority is required?

More than three quarters of the entire capital must support the resolution, unless the articles require a higher majority.

Must every member contribute proportionately?

Proportional allocation is the statutory default. A different allocation may be approved, but it needs clear wording, consistency with the articles, and a defensible commercial basis.

Can a dissenting member refuse and leave the company?

A member who did not vote for the resolution may invoke the Article 134 exit protection within one month. The notice and financial settlement then follow the applicable statutory withdrawal rules.

Can the company pay interest?

Yes, but only if interest is expressly agreed. Its rate and terms require accounting, transfer-pricing, withholding, and hidden-distribution review.

Is the contribution the same as a shareholder loan or capital increase?

No. It arises from a corporate resolution, has a defined temporary term, and can bind members subject to dissent protection. A loan is contractual debt, while a capital increase is permanent registered equity.

Does the owner rank ahead of other creditors for repayment?

Article 134 provides no automatic security or priority. Without valid separate security or another privilege, the repayment claim normally competes as an unsecured insolvency claim.