What is a VCC?
A Variable Capital Company (VCC or DPK in Bulgarian) is a modern legal form introduced in Bulgaria in 2022, designed to offer a flexible ownership and capital structure. It enables startups and SMEs to scale easily, onboard investors without heavy bureaucracy, and operate with fewer administrative burdens compared to traditional forms like Limited Liability Companies like EOOD and OOD.
| Comparison: LLC vs. VCC Feature | Variable Capital Company | Limited Liability Company |
|
Legal Form |
Hybrid, startup-friendly form |
Traditional limited liability company |
|
Minimum Capital |
EUR 1; no capital-raising account needed |
EUR 1; must open capital-raising bank account |
|
Incorporation Time |
Fast ~2-3 business days |
Slower ~ 1–2 weeks (due to banking and registration delays) |
|
Capital Structure |
Variable – capital increases/decreases don’t require registration in the Commercial Register |
Fixed – changes require notary and registration |
|
Shareholder Changes |
Easy entry/exit; no notary needed unless AoA says so |
Requires notary + Commercial Register update |
|
Classes of Shares |
Possible (e.g. ordinary, preferred) |
Not allowed |
|
Investor Access |
Streamlined – designed for onboarding outside investors |
Complex – requires formal shareholder consent and procedures |
|
Liability |
Limited to capital contributions |
Same |
|
Best Use Case |
Startups, scale-ups, dynamic ventures |
Small traditional businesses, freelancers |
Key Advantages of DPK
- Flexible Capital – No need to notarially amend the capital for new investors.
- Easy Ownership Transfers – Share transfers can be done in ordinary written form.
- Customizable Articles – You can regulate entry/exit mechanisms in the Articles of Association.
- Supports Growth – Ideal for companies planning for employee stock options (ESOPs) or venture funding.
- Lower Admin Burden – No bank deposit or notary needed at start.
When to Choose DPK?
Choose VCC (DPK) if:
- You want to attract investors.
- You anticipate changing shareholders or funding rounds.
- You want legal agility in a modern business framework.
Consider LLC (OOD/EOOD) if:
- You're starting a small, family-run or freelance business.
- You prefer a simple structure with little outside participation.
Legal Limitations of VCC
A VCC must meet the following criteria to maintain its legal form:
- Average number of employees: less than 50
- Annual turnover up to EUR 2m. and /or
- Total assets up to EUR 2m.
If either the employee limit is exceeded, or both the turnover and asset thresholds are breached, the VCC must be transformed into:
- a Limited Liability Company, or
- a Joint-Stock Company
Learn More:
For business support or incorporation assistance: office@corporatebulgaria.com
