Bulgaria Real Estate Investment Trusts - Special Purpose Investment companies (SPICs)

Bulgaria Real Estate Investment Trusts - Special Purpose Investment companies (SPICs) investor enjoying dividend income

Don't envy my great retirement -- Join the fun!

Click to discover my secret to ever-growing income from investments for life -- whether the stock market goes up or down

The "Special Purpose Investment Companies Act" passed in 2003, creating pass-through entities -- meaning they are free of corporate taxes. However, they can be structured only as a special kind of joint stock company (AD).

This law became effective January 1, 2004. However, the first SPIC company did not get started until 2005.

Special Purpose Investment Companies -- SPICs -- are Subject to Bulgarian Law

The full legal name of the SPIC must include: "joint stock special purpose investment company" or the abbreviation "JSSPIC." The company's headquarters must be within Bulgaria.

However, SPICs are limited to purchasing real estate, constructing and improving property, managing property, renting or leasing property, and selling property. They may not invest in property outside of Bulgaria, or in property under legal dispute.

They may take out bank loans for up to 20% of a property's value - meaning they must come up with the other 80% in cash - and pay those loans back within one year. They may also invest up to 10% of their capital into mortgage bonds. No more than 10% of their assets may be invested in service companies.

The minimum capital is 500,000 BGN (255,646 euros), and has to be in the form of cash. A SPIC requires a license from the Bulgarian Financial Supervision Commission (FSC).

The Bulgarian Special Purpose Investment Company is exempt from income taxes per the Bulgarian Corporate Income Tax Act (CITA). Dividend distributions to nonresidents is subject to withholding taxes. There cannot be more than fifty founders. At least 90% of their net profits must be distributed to shareholders.

After the company is incorporated, at least 30% of its shares must be available on the Bulgarian Stock Exchange. And at least 30% of initial capital must be subscribed to by institutional investors.

After the IPO, they may raise money through selling equity or bonds.

REITs in Bulgaria can be either "closed" or "open." As of July 2010 there were nineteen SPICs listed on the Bulgarian Stock Exchange.

Bulgarian Real Estate Investment Trusts Include:

Now download The Death of Capital Gains Investing, your first step toward experiencing for yourself the joy of securing your retirement through income investing!

It's easy. Just enter your first name and email address into the form below.

(NOTE: After you click the button, you'll be taken to a thank you page with the link to download your free report.)

Copyright 2007-2017 by Gold Egg Investing LLC. All rights reserved.

Income Investing Site Full Disclaimer and Website Agreement