Excluding a partner from a Bulgarian OOD is not a shortcut for resolving a shareholder disagreement. It is a severe membership sanction available only on specified statutory grounds and through a carefully evidenced procedure. A vague warning, an invitation sent to the wrong address, or one misplaced vote can undo the exclusion after the company has already changed its management, capital, and banking arrangements.

The process has two different tracks. Failure to pay a subscribed capital contribution follows the special deemed-exclusion mechanism in Article 126(1) of the Commercial Act. Misconduct and failure to pay an additional cash contribution fall under Article 126(3) and require a general-meeting decision. Mixing the two routes is a common and expensive error.

This guide provides general information as at 1 August 2026. It is not legal, litigation, accounting, tax, valuation, or Registry advice for a particular company, partner, or dispute.

Partner Exclusion at a Glance

Start With the Correct Statutory Ground

Article 126(3) of the current Commercial Act contains four grounds following a written warning.

Failure to Assist the Company

The partner must have failed to provide cooperation genuinely required for the company's activity. Ordinary commercial disagreement, voting against a proposal, or refusing an informal request is not automatically a breach. Identify the duty in Article 124, the company agreement, a valid corporate decision, or a concrete business need, and prove what cooperation was requested, when, and why it mattered.

Failure to Implement General-Meeting Decisions

The decision must be identifiable, valid, applicable to that partner, and capable of performance. The file should show the resolution, notice or knowledge, the required act, deadline, and actual non-performance. A warning that merely says “failure to comply with company decisions” does not allow a meaningful defence.

Acting Against the Company's Interests

This is not a licence to punish an unpopular minority. Tie the allegation to specific transactions, diversion of customers, misuse of assets or information, obstruction, competing conduct, or another provable act and explain its effect on the company. Preserve contracts, messages, accounting records, access logs, and witness evidence lawfully. Serious conduct may justify exclusion even without a long series of incidents; recurrence, intention, loss, and the possibility of correction remain relevant to the overall assessment.

The Supreme Court of Cassation's binding Interpretive Decision No. 1/2020, issued on 31 May 2023, confirms that a partner-manager may be excluded for acts performed as manager when those acts also satisfy Article 126(3)(1)–(3). Removal as manager, a damages claim under Article 145, and exclusion as partner are still distinct decisions and remedies. Our manager-duties guide explains that division.

Unpaid Additional Cash Contribution

Where the meeting validly orders an additional cash contribution under Article 134, a partner who voted against it—or was absent without having been properly invited—has a one-month statutory opportunity to leave under Article 134(2). The Article 126(3)(4) exclusion ground applies only if the contribution is unpaid and that exit right was not exercised. Review the underlying contribution resolution, need, allocation, maturity, service, and exit window before warning. See our additional cash contributions guide.

Capital-Contribution Default Is a Different Route

A partner who has not paid or contributed their subscribed share follows Article 126(1), not the misconduct vote above. The general meeting sets an additional period of at least one month by a majority of more than half of the capital. The manager must notify the partner in writing of that period and warn of exclusion. If the contribution remains unpaid at expiry, the partner is deemed excluded.

There is no substitute for the statutory month, and the consequences are different: Article 126(2) says the defaulting partner loses rights to contributions already made. Do not extend that forfeiture rule to a partner excluded for conduct under Article 126(3), whose property settlement follows the ordinary membership- termination rules.

Draft and Serve a Defensible Warning

The warning opens the conduct-exclusion process. It should name the sender and company, identify each act or omission by date and context, connect it to the precise statutory ground, state the corrective action where correction remains possible, set a fact-appropriate period, and say that exclusion will be proposed if the position is not remedied or satisfactorily answered.

Supreme Court case law treats the warning as both notice of the alleged breaches and a chance to prepare a defence. It may be incorporated into the meeting invitation, but the seven-day invitation minimum is not an automatic universal cure period. The time must be suitable for the complexity, evidence, and whether the alleged conduct can still be corrected. Reusing an old warning from an aborted or annulled exclusion procedure is also unsafe; issue a current warning for the actual procedure.

A prior meeting decision authorising the warning is not generally required unless the company agreement creates one. Depending on the governance and conflict, a manager or another partner may deliver it. Use a method that proves the complete document reached the correct person: personal delivery against acknowledgement, notarial service, courier, or registered post may work if the company agreement and facts support it. Deliberate service at an address known to be obsolete is not cured by creating a delivery record.

The exclusion resolution should not rely on new allegations absent from the warning. If further material conduct emerges, pause, update the warning and evidence, and give a fresh opportunity to respond.

Convene and Conduct the General Meeting

The manager ordinarily calls the meeting. Partners holding more than one tenth of the capital may request it in writing; if the manager does not call it within two weeks, those requesting partners may do so. Article 139 requires every partner, including the target, to receive a written invitation at least seven days before the meeting unless the company agreement sets another period. The agenda should expressly cover the exclusion and each consequential decision on shares, capital, company agreement, legal form, management, and filing.

The targeted partner may attend, receive the materials, explain their position, and object, but does not vote on their own exclusion. Article 137(3) deducts their share from the capital when calculating the majority. The remaining votes must exceed three quarters of that adjusted amount, and the company agreement may require more. For example, if the target owns 25% and the others own 40% and 35%, the adjusted base is 75%; approval must exceed 56.25 percentage points of the registered capital.

The Commercial Act does not create a general statutory quorum for an OOD. If the company agreement adds one, its wording and interaction with the conflicted share must be analysed separately; do not casually describe the statutory deduction as a universal quorum rule. In a 50/50 company, the remaining partner's 50% can satisfy the adjusted statutory majority, but that arithmetic does not excuse a weak ground, bad service, defective form, or abuse of rights.

Record who attended, service evidence, objections, the exclusion facts and legal ground, the excluded share, adjusted calculation, each vote, effective steps, and all consequential resolutions. Minutes require simultaneous notarial certification of signatures and content unless the registered company agreement validly permits ordinary written form. A resolution adopted in the wrong form is void under Article 137(5).

Resolve the Shares, Capital, and Management

Exclusion does not automatically transfer the former partner's share to the remaining partners. The meeting must choose a lawful corporate route and amend the company agreement. Depending on the facts, the remaining partners may assume the capital participation, a new partner may be admitted through the proper written application and approval, the capital may be reduced with creditor-protection steps, or a coordinated reduction and increase may preserve the registered amount. The 2023 interpretive decision expressly highlights these consequential decisions.

If one partner remains, address continuation as an EOOD. If the excluded partner is also manager, decide separately whether to remove them, appoint a replacement, authorise the management agreement, and change representation. Do not leave the company without someone able to file or operate its accounts. A consensual share transfer may be safer where a real buyout remains possible.

A4 Filing, Effect, and Documents

Submit the changes with an A4 application, normally within the general seven-day filing period. A complete package commonly includes:

• the warning and proof of receipt
• the meeting request where partners called the meeting, invitation, and proof of receipt by every partner
• the certified minutes and each linked resolution
• the amended company agreement in the required adopted and publication copies
• documents for the share/capital route, new partner, legal-form change, or new manager, where applicable
• the applicant's statutory declaration, authority documents, and fee evidence

The Registry's current OOD/EOOD service page states a base change fee of EUR 7.67 online or EUR 15.34 on paper. The portal calculates any additional publication or combined-change charge. In 2026, ensure capital and nominal share figures in the amended agreement use the current euro values and follow the Registry's conversion instructions.

Article 140(4) states that exclusion takes effect from Commercial Register entry. At the same time, established Supreme Court case law treats the meeting resolution as immediately operative in internal company relations, and the 2023 interpretive decision describes the excluded person as losing membership upon adoption while retaining the right to challenge. This internal/external distinction makes the period before entry and during litigation hazardous. File promptly, but do not assume entry validates a defective process or that delayed entry makes the resolution harmless.

Settle the Former Partner's Property Interest

Articles 125(3) and 127 require the property consequences to be calculated from an accounting balance at the end of the month in which membership terminated, normally in proportion to the partner's capital participation unless validly agreed otherwise. This is a balance-sheet settlement, not automatically the original capital, an agreed sale price, or the enterprise's market value. Liabilities and the company's actual net position matter.

Because the effective date can interact with the internal-effect and registration rules, document the selected balance date and legal basis. The Act does not supply one universal payment timetable for every case; check the company agreement, liquidity, maturity rules, set-off requirements, and any separate damages claim. Do not manufacture a deduction from the settlement merely because the exclusion alleges loss—prove and pursue the company's claim through the correct route.

Court Challenge and Interim Risk

The excluded partner may bring an Article 74 claim against the company before the district court at its seat. If present or properly invited, the deadline is 14 days from the meeting. Otherwise it is 14 days from learning of the decision, but never later than three months from the meeting. These are short preclusive limits.

The claim may attack the warning, service, invitation, agenda, majority, minutes, company-agreement compliance, evidence, statutory ground, and consequential resolutions. Under Interpretive Decision No. 1/2020, an excluded partner-manager may also challenge related decisions from the same meeting, such as removal as manager, so that protection is effective rather than fragmented.

An Article 74 claim does not create a comfortable automatic pause. Seek case- appropriate interim protection urgently if Registry filings, asset dispositions, bank access, management changes, or further meetings could cause irreversible effects. A successful judgment is constitutive and the intervening corporate acts require their own analysis; neither side should assume that the final result will rewind every step automatically.

Deadlock, Abuse, and Safer Alternatives

Deadlock by itself is not an Article 126 ground. Before exclusion, compare a negotiated buyout, voluntary withdrawal, mediation, a governance protocol, removal from management while retaining ownership, a specific damages or accounting claim, and—in a genuinely irreparable case—the statutory court route for termination for important reasons. Preserve records and business continuity without locking a partner out through self-help before the legal position is clear.

Our OOD formation guide explains why precise reserved matters, information rights, transfer rules, and deadlock mechanisms are best agreed before relations deteriorate.

Lion Consult can review the evidence and company agreement, prepare or challenge the warning and resolutions, coordinate the A4 package, and plan the settlement and interim safeguards. Discuss the dispute with our team.

Partner exclusion is fact-sensitive, procedurally strict, and frequently litigated. Obtain Bulgarian corporate and litigation advice before serving a warning, voting, changing Registry data, restricting access, valuing the former partner's interest, or disposing of company assets.

Frequently Asked Questions

What grounds permit exclusion from a Bulgarian OOD?

Article 126(3) contains four grounds: failure to assist the company, failure to implement general-meeting decisions, acting against company interests, and failure to pay an additional cash contribution without exercising the statutory exit right. Unpaid subscribed capital follows a separate Article 126(1) procedure.

Is a written warning mandatory?

Yes. It must identify concrete conduct, reach the partner, and allow suitable time for defence and possible correction. The seven-day meeting-notice period is not automatically a sufficient cure period.

What majority is required?

More than three quarters of the capital remaining after deducting the targeted partner's share. The company agreement may require a higher majority.

Can the targeted partner attend or vote?

They should receive the invitation and may attend, review the allegations, and defend themselves, but cannot vote on their own exclusion.

When does exclusion take effect?

Article 140(4) refers to Commercial Register entry, while Supreme Court case law recognises immediate internal effects from the resolution. The interim period therefore requires careful handling.

How quickly must the partner challenge the decision?

Generally within 14 days from the meeting if present or properly invited; otherwise within 14 days from learning of it, but no later than three months after the meeting.

How is the former partner's financial interest calculated?

Under Articles 125(3) and 127, settlement uses an accounting balance at the end of the termination month and the applicable participation ratio. It is not automatically market value, original capital, or a negotiated sale price.