Dateline: Belgrade, Serbia
When I first arrived in Bulgaria a couple of years ago, I immediately sensed that Bulgaria was different.
In Brussels or Amsterdam, most people are quite friendly to foreigners regardless of their passport. Even in parts of Germany that aren’t as welcoming, I still found most people to be quite nice – even the customs officers.
In Bulgaria, however, I could feel the Soviet influence. Unlike most countries in the European Union, Bulgaria isn’t in the Schengen zone, so I needed to go through customs to get in and out of the country. And, unlike their European counterparts, Bulgaria’s immigration officials were a bit curt and difficult when I interacted with them, and they often asked questions in a way that didn’t often happen in Europe.
See, Bulgaria straddles this tenuous border between Eastern and Western Europe. On one hand, the country has opened its doors to the West through EU membership, but on the other, it still has deep historical ties to Russia and the Commonwealth of Independent States, which comprises much of the former Soviet Union.
In that context, it makes more sense why Bulgaria seems a bit removed from its Dutch and Belgian counterparts – and why not many people know about its citizenship by investment program.
Bulgaria presents an interesting option for many people, but it does have its challenges. Unlike Spain or Portugal, Bulgaria is not romanticized enough to garner much attention on its own, and its CBI process isn’t as quick or easy as Cypress, whose CBI process takes just 60-90 days.
However, despite its gruff exterior, Bulgaria has plenty to offer in the way of citizenship by investment. Not only is it a fascinating and culturally rich country but it also has one of the simplest and most efficient citizenship by investment programs in the EU.
And, as an added bonus, it also has one of the lowest tax rates in Europe.
In this ultimate guide, we will tell you everything that you need to know about Bulgaria’s citizenship by investment program. This guide will cover:
- Why Bulgarian CBI is an interesting option
- What a Bulgarian passport gets you
- Who should consider Bulgarian CBI
- An overview of Bulgaria’s CBI program
- How to get a Bulgarian passport
- The fast-track option
- Whether Bulgarian CBI is the right choice for you
So, let’s get started!
But first things first – before you dive straight into applying for an economic passport in Bulgaria, you should take the time to learn a bit more about what citizenship by investment is and how to avoid scams and fake programs. Here are some other articles and videos to help you:
- Are Economic Citizenship Programs Worth the Cost?
- How to Become a European Union Citizen
- 11 Citizenship by Investment Programs for 2018
- The Most Efficient and Affordable Economic Citizenship Program
- Fast Citizenship by Investment Options
When you think of second passports, odds are you think of places like Cypress or Dominica where you can get citizenship by investment in a matter of months, or you might think of countries like Canada, where citizens get benefits like universal healthcare.
So, why would you want a Bulgarian passport?
Frankly, that’s a fair question. Unlike many countries in the Caribbean, getting citizenship by investment in Bulgaria is not fast and (relatively) cheap. You’ll need to spend over €500,000 just to get your foot in the door, and if you want to fast-track your citizenship, you will spend double that amount. And, even if you decide to expedite the process, it will still take two years for you to get a Bulgarian passport.
Bulgaria also does not appear to be all that special at first glance. In many regards, Bulgaria is distinctly middle-of-the-road. The Index of Economic Freedom assigns Bulgaria a rating of 68.3, which ranks it 23rd among 44 European countries and 47th in the world. Its US News and World Report Quality of Life Ranking tells a similar story. Bulgaria ranks #31 out of 80, sitting right in the middle along with India, Thailand, and Croatia.
Bulgaria is also a member of the European Union, which is both a benefit and a drawback in a sense. On one hand, you’ll be able to travel freely and invest in property throughout the EU, but on the other hand, you will also be subject to the whims of a large, cumbersome government entity that might impose stricter rules on citizenship-based taxation and residency requirements.
Despite these issues, Bulgaria can be an attractive option for citizenship by investment.
With its rich history, proud culture, and stunning scenery, planting a flag in Bulgaria can be quite worthwhile if you’re willing to endure the process.
A Rich History
Bulgaria’s history is rich and fascinating. Throughout its history, it has been part of the Roman Empire, the Byzantine Empire, the Ottoman Empire and, during the 20th Century, it was part of the Soviet Bloc. Bulgaria is also the birthplace of the Cyrillic alphabet, which is used in many Eastern European languages.
It’s no wonder, then, why Bulgaria is a unique point where East meets West.
As a Bulgarian citizen, you’ll be able to take the time to learn about this country’s interesting history in ways that a tourist or regular visitor might not. You can visit major tourist attractions like the Rila Monastery and Old Nessebar, sure, but you’ll learn even more from exploring Bulgarian cities and talking with knowledgeable locals as you spend time in your new country of citizenship.
A Proud Culture
Although Bulgaria has been ruled by a number of different empires, it has a culture all its own, and Bulgarians take immense pride in it – for good reason, too.
When you spend time in Bulgaria, you’ll quickly become familiar with national traditions, arts, and cuisine. During your visits, you may get to experience interesting traditions like “Mummers,” where men perform ritual dances in traditional garb to ward off bad spirits before the New Year, or you might spend a day exploring the streets of Sofia, where you’ll encounter streets bustling with art galleries, museums, and traditional street performers.
The country is also a food lover’s paradise with diverse local cuisine as well as traditional dishes derived from Russian, Italian, and Middle Eastern cooking traditions.
As a citizen of Bulgaria, you’ll find that locals are more than willing to share these cultural traditions with you. And, if you’re lucky, you may even be able to partake in these rich cultural traditions yourself.
Some people may consider becoming a resident of Bulgaria for one reason alone – the country’s breathtaking beauty.
Bulgaria features a wide array of landscapes, including the Rila Mountains and beaches along the Black Sea. This means that you’ll be able to spend a day enjoying top-quality Alpine skiing and still make it to the coast in time for a sunset dinner.
Bulgaria’s diverse and scenic landscape also means that you have a great variety of options to choose from when deciding on your official second residence. Whether you dream of owning an Alpine ski villa or a condo by the beach, you’ll have plenty of options in Bulgaria.
What does a Bulgarian Passport Get You?
In addition to its cultural richness and gorgeous landscapes, you get plenty of practical benefits with a Bulgarian passport, too.
Bulgaria, in many ways, could be considered a “lite” version of the EU. Citizens and permanent residents get some of the most important benefits of EU citizenship, but it’s quite a bit different from their Western European counterparts, who have astronomical tax rates, complicated citizenship procedures, and are more thoroughly integrated into the EU’s cumbersome regulatory system.
Bulgarian citizenship can therefore give you the best of both worlds – you get a reasonably strong passport and EU citizenship without having to jump through hoops like language and residency requirements.
As you consider whether you want to pursue citizenship by investment in Bulgaria, take these benefits into account.
EU citizenship is certainly the biggest selling point of Bulgarian citizenship by investment. As a Bulgarian citizen, you get the rights and privileges of an EU citizen, and even as a permanent resident you get access to a handful of benefits such as the ability to buy property within the EU.
You also get relative freedom of movement, but keep in mind that Bulgaria isn’t part of the Schengen zone (yet).
Bulgaria’s exclusion from the Schengen zone is both a good thing and a bad thing. It can be somewhat of a pain to go through immigration control when taking a short trip from Munich to Sofia, but at the same time, you get easier access to countries like the UK, which don’t have a visa-free arrangement with the Schengen area.
However, as EU citizens, Bulgarians can still travel freely in the Schengen zone and in other EU countries – they may just have to wait in line at the airport.
Bulgaria’s exclusion from the Schengen zone demonstrates how it’s sort of an “EU-lite” country. You get the vast majority of the benefits of EU citizenship, but since it’s not fully integrated into the EU infrastructure, Bulgaria also has the freedom to negotiate its own visa policies, which can be beneficial in cases like the UK.
Bulgaria is also a fairly high-quality passport. It gets you visa-free access to 157 countries and is tied with Hungary for the 8th-strongest passport in the world.
Bulgaria is what I like to call an A- passport. It gives you fairly good access to basically everywhere in the world that a western passport gives you – minus the US.
However, on the bright side, you can get into Canada, Australia, New Zealand, and the UAE visa-free.
So, if you’re renouncing US citizenship or need to frequently travel to the US, this may be a deal breaker for you. Keep in mind, though, that you may get visa-free travel in the future as Europe pressures the US for visa reciprocity, and if your current passport is from somewhere like China or Turkey, you’ll have an easier time navigating the US visa process as a Bulgarian citizen.
All in all, the Bulgarian passport is fairly strong, but if visa-free travel to the US is a must for you, then you may want to consider other options.
Unlike most of Europe, Bulgaria’s tax rate is fairly low.
In fact, it might be the lowest in the European Union at just 10% on corporations and 10% on personal income.
It’s no wonder, then, why many Europeans move to Bulgaria – at least on paper – to escape more complicated tax residency procedures and some of the astronomical tax rates found throughout the continent.
Bulgaria also doesn’t have citizenship-based taxation, so if you decide you don’t want to spend much time there, you won’t even have to worry about tax.
Citizenship by Descent
Another benefit of Bulgarian citizenship is that it passes on to your descendants – even adult children.
This makes it an attractive option if you’re looking to permanently leave the US or want to expand your children’s educational opportunities as an emerging world citizen. Unlike countries such as Portugal, which require your children to re-apply, Bulgarian citizenship is passed on automatically, and your children will be able to near-instantly access all of the benefits of Bulgarian and EU citizenship.
Who Should Consider Bulgarian Citizenship by Investment?
Bulgarian citizenship by investment is not for everyone, but it’s also one of the easiest CBIs to get in Europe. This makes it attractive for someone looking to add an EU passport to their portfolio without cumbersome language or residency requirements.
If you fall into any of the categories below, then pursuing citizenship by investment in Bulgaria may be the right choice for you.
People Who Do Business in the EU
Bulgaria is, by far, one of the easiest places to get a second passport in the EU, making it an attractive option for businesspeople who want an EU passport without much hassle.
US citizens who frequently do business in the EU, for example, may want to invest in an EU passport to ensure visa-free access to the Schengen zone and other EU countries. Since the EU has recently debated eliminating visa-free access for US citizens over reciprocity issues, a second passport from the EU may give US businesspeople the peace of mind that they’ll always have visa-free access to EU countries.
And, while Bulgaria does not currently belong to the Schengen zone, it won’t be long before they do. Getting a passport now means you’ll automatically have access to that benefit once it is available.
Emerging World Citizens
Emerging world citizens from places like China or Russia can often become frustrated with losing opportunities due to “bad passports” that only offer visa-free access to a limited number of countries.
Unlike people from the US, Canada, or Australia who already have top-tier passports, emerging world citizens may not find much value in pursuing a second passport in somewhere like St. Kitts, which can offer some improvement but does not expand their horizons beyond a handful more of visa-free countries. People from countries with fewer visa-free options might then consider becoming a citizen by investment in Bulgaria in order to get more opportunities with a European passport.
People Looking to Renounce their US Citizenship
If you’re considering renouncing your US citizenship, you’ll find that one of the hardest things to let go of is the strength of the US passport. While you can cover a lot of ground with a solid passport portfolio, it’s hard to give up one of the world’s strongest passports.
However, with a Bulgarian passport, you can give up your US citizenship without giving up a solid passport. As mentioned, Bulgarian citizens have visa-free access to 157 countries, making it the 8th-strongest passport in the world.
If you’re trying to renounce as quickly as possible, then that’s certainly not a bad deal.
Anyone Who Wants to Live in Bulgaria (and Has the Means to Invest)
While I am personally not a huge fan of Bulgaria, I can see why people enjoy it. The country’s scenic landscapes and relaxed pace of life are certainly appealing to investors looking for an escape from hectic international hubs like New York or Dubai.
So, if you have the money to spare and are truly enamored with Bulgaria, go for it.
However, before you pull the trigger, be sure that Bulgarian citizenship is something that you really want. Bulgarian CBI may not necessarily be in your best economic interest, so if you do move forward with the process, be sure that your personal reasons are enough to justify the time and money.
About the Bulgarian Citizenship by Investment Program
The Bulgarian CBI program – officially called the Bulgaria Immigrant Investor Program – was designed to attract foreign investors and businesspeople to the country.
With a price tag of €512,000 or more, it goes without saying that this program is geared toward individuals with plenty of cash to spare. If this level of investment makes you uncomfortable, then you may want to consider cheaper options like Dominica.
However, it’s much less expensive than earning citizenship in other EU countries, which require much more of your time and money.
Bulgaria’s citizenship by investment program is also much less publicized than its Caribbean counterparts – to the point where less-informed folks might deny its existence altogether. This is understandable, I suppose, since only a handful of people I know really promote it.
But don’t let the naysayers scare you off – Bulgaria’s CBI program does exist, and it’s perfectly legal and legitimate.
In my opinion, Bulgaria’s CBI program is almost more of a residence by investment program than a traditional CBI program like you’ll find in the Caribbean. Traditional CBI programs typically take less than a year to complete, so you’ll have your second passport in hand in a matter of months.
If you’d prefer this faster, cheaper route, check this out.
Residence by investment programs, on the other hand, take a longer time to process, making them more geared toward people who actually want to live in the country. Since you’ll have to wait at least two years for your Bulgarian passport, Bulgaria’s CBI program is more like the residence by investment programs that you’ll find in Malta or Portugal – but with a lot less red tape.
Unlike many European countries, you don’t need to live there as a resident to become a citizen; you don’t need to stay there all the time and you won’t be subject to pesky language or residency requirements. In the words of my advisor in the EU, it’s a “different ballgame.”
Bulgaria’s CBI program is also more open than what you’ll find in most of Europe (and most western countries in general, for that matter). While many western countries tend to discriminate against citizens from some parts of the world – especially China – Bulgaria’s CBI program is generally willing to grant citizenship to anyone.
How Do I Get a Bulgarian Passport?
Getting Bulgarian citizenship by investment is a relatively easy process. Once you submit your paperwork and establish a permanent residence in Bulgaria, you make your investment and you wait 2-5 years until you earn your citizenship.
Sounds simple enough, right?
While it’s nowhere near as complicated as German or French citizenship, you still need to ensure that you go about it correctly to avoid getting caught in red tape, which is why we’ve prepared this step-by-step guide to getting Bulgarian citizenship by investment:
1. Make Sure You Qualify
Before you make a beeline for your nearest Bulgarian consulate, make sure that you qualify for citizenship by investment in Bulgaria.
Fortunately, it’s fairly easy to qualify for Bulgaria’s CBI program as long as you’re not a criminal or from the EU. Bulgaria’s basic CBI requirements include:
- Not currently being an EU citizen
- Possessing a valid passport
- Holding no criminal record
- Not being sanctioned by the EU
These requirements are pretty straightforward, but keep in mind that you will need to provide a criminal background check or a similar record from your home country and/or country of residence.
2. Make Your Investment
If you’re eligible for Bulgaria’s citizenship by investment program, you can then begin the process of CBI by making your investment.
In Bulgaria, your only option is to invest €512,000 – or 1 million Bulgarian Lev, which is pegged to the Euro – in a government bond. While you’re not going to get major returns like you might with investing in a local company or in real estate, you’re guaranteed your money back at the end of the 5-year waiting period.
To finance your investment, you have three options – investing outright, financing through the Bulgarian government, or financing elsewhere.
Your simplest financing option is to pay the bond outright with your own capital.
This way, you won’t need to worry about interest rates or outside financing, and your money will effectively be held in an account that’s locked for five years. It’s the simple, no-nonsense way to go about investing in citizenship in Bulgaria.
However, not everyone wants to tie up nearly $1 million for five years – especially since you likely have high-yielding investments and operating companies back home. So, unless you have a lot of spare capital, then you may want to consider the two financing options below.
Financing Through the Bulgarian Government
If you’d prefer not to tie up €512,000 in government bonds for the next five years, then you may want to consider financing the bond with a loan through the Bulgarian government.
Financing the bond this way is relatively easy. You choose to pursue this option when applying and making your investment and all you need to do is pay an up-front deposit, which is normally around $195,000.
That’s right, $195,000.
And, that’s not including interest, which can add up to around $320K.
This interest rate looks fairly steep (and since it uses local currency and not the Euro, it’s not negative), but it’s also a relatively safe loan since it’s financed through official channels. It also leaves you free to invest your capital in other ventures, so you can more easily earn back what you end up paying into the system.
However, since interest rates change and currency fluctuates, you may want to consider paying your interest up-front to ensure that your payments don’t unexpectedly double over the next few years.
You can also finance the bond in your home country or outside of Bulgaria. According to my EU advisor, Bulgaria generally doesn’t care much about where the money comes from – provided it’s from a legitimate source.
So, unless you were planning to use a drug smuggling fortune to pay your dues, you’re in the clear to use whatever legal means necessary to finance your bond.
In some cases, financing externally can be beneficial since you might be able to get lower interest rates or keep the loan in your home currency, eliminating the need to worry about currency fluctuations.
If you do finance externally, keep a record of your transaction in case Bulgarian officials ask for it. They’re not worried about whether you’ve financed in the country – they just want to make sure that you’re not involved in any criminal activity.
3. Establish Permanent Residency
Once you’ve sorted out your paperwork and finances, you can then head to your nearest Bulgarian consulate and apply for citizenship by investment.
Once you submit your application to the consulate and then to the Ministry of Foreign Affairs, you’ll be issued a visa that allows you to enter Bulgaria and establish a permanent residence. On this trip, you’ll find a suitable home in Bulgaria to use for the next five years, and you’ll submit your paperwork to file for permanent residence.
Once that process is complete, you’ll be issued another visa to return to Bulgaria to register and retrieve your identity documents, thus becoming a permanent resident of Bulgaria. This whole process takes about 6 to 9 months.
As a permanent resident, you’ll enjoy a handful of the benefits offered to Bulgarian and EU citizens, but you won’t have a Bulgarian passport for at least another two years. So, while you may be able to study in the EU, you’ll still have to apply for a visa to the Schengen zone if your current passport doesn’t offer visa-free access.
After you attain permanent residency in Bulgaria, you’ll still need to wait a while to become an official citizen.
Typically, this process takes 2-5 years.
The length of time you wait for your Bulgarian passport depends on whether you choose to fast-track the process (which is discussed in more detail below). If you do decide to pay double to speed up the process, then your wait time is reduced to just 2 years.
If you aren’t willing to pay more, then you’ll have to wait for the full five to get your Bulgarian passport.
The Fast-Track Option
Candidates for Bulgarian citizenship by investment also have the option to fast-track the process by doubling their investment amount.
By investing in another €512,000 bond, you can reduce your waiting period from five years to only two, allowing you to obtain full Bulgarian citizenship in less than three years.
However, keep in mind that you’ll still have to wait until the end of the duration of the bond to get your money back if you invest directly, and if you finance your investment through the Bulgarian government, you will need to pay more interest on top of what you have already paid.
Whether the fast track option is worthwhile for you depends on your needs. On one hand, you may need unfettered access to the EU as soon as possible, so fast-tracking might be worth your while if you must regularly attend to business interests in Europe.
However, if you’re more focused on other benefits, such as allowing your children to study in the EU, you won’t necessarily need to fast-track since you’ll already have those benefits as a permanent resident.
The great thing about Bulgaria’s CBI fast-track option is that you don’t need to decide right away. Since it’s somewhat akin to a call option on a stock, you can invest the minimum amount up-front and then wait to see if paying the extra 1 million Lev is worthwhile.
Keep in mind, though, that if you’re financing the bond, you’ll end up paying more in interest if you decide to fast-track, which adds up over time. You’ll also need to pay an extra $125,000 up-front for the second bond.
Though it comes with some extra cost, this fast-track option is simple and straightforward for anyone willing to shell out a bit more for getting a Bulgarian passport in two years instead of five.
Is Bulgarian Citizenship the Right Choice For Me?
Even if you’re the ideal candidate for Bulgarian citizenship by investment, you may still be wondering whether you should invest the time and money into becoming a Bulgarian citizen.
Bulgarian citizenship can be the best of both worlds in some ways, but it can also be the worst of both worlds in others. While Bulgaria’s tax burden is reasonable now, for example, the EU could easily swoop in and raise rates or impose citizenship-based taxation.
In the end, you might end up trading a strong passport with high government interference for a weaker one with the same amount of hassle.
Personally, I’m not a big fan of the program. I generally believe that lower-tier B or C passports like St. Kitts or Turkey are the way of the future, so I’m not too inclined to pay hundreds of thousands more for a passport that could hinder me in the same ways that my US one did. I also don’t frequently travel to countries like Canada and New Zealand, so visa-free access there isn’t as important to me.
However, you may be in a different boat and a Bulgarian passport could fill an important gap in your passport portfolio. If you need to travel frequently to countries like Australia, for example, then having a passport with visa-free access is likely important to you.
Therefore, when making your decision, consider the following factors to see whether Bulgarian CBI is right for you.
While you get permanent residency (and all of the benefits that come with it) almost immediately, you need to wait at least two years before officially becoming a Bulgarian citizen. If you don’t feel like doubling your investment, then the process will take longer.
While this is a fairly short amount of time for an A-level passport, it’s also not ideal for someone who needs a second passport relatively quickly.
One of the major benefits of Bulgaria’s CBI program is that its physical presence requirement is minimal – you just need to spend maybe a couple of days in the country per year to reap the benefits of the program.
However, while you’re in the permanent residence phase, you’ll need to maintain an address in the country (even if you don’t spend much time there), meaning you have to rent an apartment or buy property in Bulgaria.
If you’re not too keen on renting a loft in Sofia or buying a cottage by the Black Sea, then you may want to reconsider.
Although Bulgaria is one of the cheaper “Golden Visa” programs in the EU, it’s still vastly more expensive than other countries around the world. You’ll either need to tie up around $1-2 million in capital for five years, or you can choose to pay interest to the tune of $195K-320K. And that doesn’t include $25,000 in fees, either.
Compared to St. Lucia, where you can spend $100,000 dollars and get a passport in just a few months, this seems like a raw deal.
However, as with all things in business, it’s a cost/benefit analysis. If you think a Bulgarian passport will save you over $100,000 in visa expenses or is worthwhile in other ways, then you may want to go for it.
Part of a successful Nomad Capitalist strategy is legally paying as few taxes as possible. So, you should evaluate whether Bulgarian citizenship will help or hinder your strategy.
If you need a residence or a company in the EU for business purposes, then Bulgaria is ideal. Its low tax rates and freedom from citizenship-based taxation means that you won’t have to pay terribly much in taxes – especially compared to other countries in the EU.
If you make enough money to finance a €512,000 bond, then you’ll almost certainly be taxed to death in countries like Denmark or France.
On the other hand, if you’re simply looking to expand your passport portfolio, then you may want to look at other options – especially countries without any income tax.
Plus, Bulgaria’s favorable tax rate may change as it becomes more integrated with the EU.
EU citizenship is perhaps the sharpest double-edged sword of Bulgarian citizenship.
The benefits of EU citizenship are certainly immense, but they come at a price. While you may be able to freely travel and buy property throughout Europe, you’re also subject to EU laws and regulations, which are becoming increasingly burdensome by the moment.
And as a new member and Schengen candidate, Bulgaria is becoming increasingly integrated into the EU infrastructure.
In my opinion, the EU is going to become a bit of an albatross as time goes on. It may try to impose citizenship-based taxation, expand asset reporting standards, or impose more stringent residency requirements.
For those of you coming from countries like the US, which impose similar standards, getting a Bulgarian passport may defeat the purpose of enhancing your freedom with a second passport if the EU becomes more involved in taxation and citizenship requirements.
When Bulgarian Citizenship Works
Bulgarian citizenship by investment is an interesting option for some people, but for many others – myself included – it isn’t the best choice.
Personally, I don’t really understand why so many people pursue this option. As a westerner looking for second passports that enhance my economic freedom, there isn’t much benefit to spending an extra $300,000 for a passport that might end up being as much of a burden as my US one.
I’m also not a huge fan of the country in and of itself, but that’s just my personal preference.
However, I can see two circumstances where you might want to pursue Bulgarian citizenship by investment.
First, if you’re an emerging world citizen from somewhere like China, visa-free access is much more important to you. You also may want to take advantage of benefits like access to tuition-free European schools, which allow you to escape the hyper-competitive Chinese school environment.
It’s no wonder, then, that so many of Bulgaria’s citizens by investment are Chinese.
Another valid reason why you may want to plant a flag in Bulgaria is to more effectively do business in the EU. With EU citizenship, you can freely travel throughout the continent and you can buy property in any EU country.
Bulgaria is highly advantageous for those individuals since it’s the easiest EU country to get citizenship in, it has the lowest tax rates in the EU, and it’s relatively easy to set up a company in Bulgaria.
Like any business investment, you’ll need to sit down and do the math to see whether Bulgarian CBI is right for you. Most people may find that it’s not worth the extra cash to get potentially-disruptive EU citizenship, but others might find that it’s the missing piece of their passport portfolio.