Incentives under the Investment Promotion Act (IPA)

Incentives under the Investment Promotion Act (IPA)

Equal treatment of Bulgarian and foreign investors
The Investment has to be related to the setting up of a new establishment, expansion, output diversification into new additional products or a fundamental change in the overall production process of existing establishments.
The investment to be made in the following economic activities:
- From the industrial sector: manufacturing industry;
- From the services sector: high-tech activities in the field of ICT, R&D, activities of head offices, education, human health care, warehousing and support activities for transportation

Investment Classes

Investment classes A and B and Priority investment projects depending on the value, region and sector allocation of the investment

Investment value thresholds, Euro m
Region or Sector	Class B	Class A
General	2.5 - 5	>5
In municipalities with unemployment rate equal or more than the country average	1 – 1.75	>1.75
In high-tech activities in the manufacturing industry for the whole country	1 – 1.75	>1.75
In high-tech activities in the services, computer technologies and R&D sectors for the whole country	0.5 – 1	>1

Class A and B investment incentives

Information services
Shortened administrative procedures - The central and local government authorities will provide administrative services shortened with one-third of the time period established by the law
Financial support for vocational training of persons for obtaining professional qualifications
On the request of certified investor the corresponding authorities may transfer ownership rights or establish a limited ownership right over real estate (private state or private municipal property) without a tender
Consulting and individual administrative services. Investors will be able to authorize Agency officials to obtain from the corresponding competent bodies on investors’ behalf and for investors’ account any documents for implementation of the corresponding investment project as may be required under the existing legislation (Only for Class A)
Financial support for construction of technical infrastructure elements to the borders of the project site, needed for implementation of one or more investment projects (Only for Class A)

Priority investment projects

All sectors of the economy, with the exception of the restrictions imposed by EU Regulation 800/2008
Council of Ministers approval
Conditions – priority status depending on the value, jobs created and region allocation of the investment

Criteria for priority investment project’s classification

Region or Sector	Investment Value (Euro m)	Jobs
General case (the entire country, all sectors)	50	200
In industrial zone construction and its development into industrial park	35	100
In municipalities with unemployment rate equal or more than the country average	25	100
In high-tech activities in the manufacturing industry for the entire country	25	100
In construction of a technological park	15	50
In education, human healthcare, IT and R&D activities, activities of head offices	10	50

Incentives for priority investment projects

Special incentives for priority investment projects:

Institutional support
Financial grants of up to 50% for education and R&D projects and up to 10% for manufacturing projects
State tax exemption for changing the land zoning
Acquisition of real estate private state or private municipal property without a tender and at a price lower than the market, but not lower than the tax assessment of the property
Establishment of public-private partnerships with municipalities, universities, other organizations from the academic society and etc