The Bulgarian Golden Visa program presents an attractive pathway for non-EU citizens to gain residency and potentially citizenship in Bulgaria. With the evolving landscape of investment options for this program, Exchange-Traded Funds (ETFs) have emerged as a compelling choice for investors. This article delves into the role of ETFs in the Bulgarian Golden Visa scheme, highlighting their benefits, risks, and the process involved in leveraging this investment vehicle for residency purposes.

Understanding ETFs in the Context of the Bulgarian Golden Visa

An Exchange-Traded Fund (ETF) is a type of investment fund that holds assets such as stocks, commodities, or bonds and is traded on stock exchanges. ETFs offer diversification across various sectors and are known for their liquidity and lower fee structures compared to traditional mutual funds. In the context of the Bulgarian Golden Visa, investing in an ETF can be a more dynamic and diversified approach to fulfilling the program’s investment requirements.

Steps to Obtain a Bulgaria Golden Visa

To obtain a Bulgaria Golden Visa through investment in a Bulgarian Fund, a minimum amount of 512,000 EUR is required. The process consists of several clearly defined steps, as outlined below:

1-Talk to Advocate Markov's Team

Start by discussing your specific circumstances with our expert team. We will guide you through the steps and requirements for obtaining a Bulgarian Golden Visa through investment in a Bulgarian Fund.

2-Pre-Approval Stage

During this stage, the Bulgarian Investment Agency conducts a preliminary approval process to verify your background and the source of the funds for the investment. This stage is completed remotely and takes about 2 months.

3-Complete Investment

After passing the pre-approval stage, the next step is to make your investment. Our team will guide you through the available Bulgarian Golden Visa Funds and assist in the process of investing in these funds.

4-Submit D Visa Application

Apply for the Bulgaria Golden visa at the Bulgarian embassy or consulate in your home country. Processing times for D visas can take a few months from the date of submission.

5-Apply for Residence Permit

This application must be made in person at the local Migration Office. The processing time for permanent residency applications also takes a few months.

6-Family Reunification

You can initiate the family reunification process immediately after your permanent residency application is approved. Your family members will need to follow the same procedure as outlined in steps 4 and 5.

Each of these stages is integral to the successful acquisition of a Bulgaria Golden Visa, and our team at Advocate Markov is committed to providing comprehensive support throughout the entire process.

ETF Selection for the Bulgaria Golden Visa

Your journey towards obtaining a Bulgaria Golden Visa requires a strategic approach, especially when it comes to selecting the right Exchange-Traded Fund that aligns with your risk tolerance. Unlike Bulgarian AIFs, which offer a degree of flexibility, ETFs follow stricter rules regarding the assets they can invest in.

To qualify for the Bulgaria Golden visa by investment in an ETF, the Fund must meet certain criteria:

Manage assets totalling no less than BGN 5,000,000.
Be licensed or registered by the Financial Supervision Commission.
Have an investment strategy entirely focused on Bulgarian assets, investing solely in shares, stocks, and bonds of Bulgarian companies, including Real Estate Investment Trusts (REITs).

Several funds currently satisfy the above requirements.

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Choosing the Right Fund

You are not restricted to investing in just one Fund. You can diversify your investment across multiple Funds that meet the criteria mentioned above. If you’re unsure about which Fund to invest in, you could consider splitting your investment among a few or several Funds to create a more balanced Alternative Investment Fund (AIF) portfolio. This diversification can extend to various commodities within each Fund, such as shares or bonds in different sectors like finance, banking, or pharmaceuticals, offering a broader risk mitigation strategy.

The primary constraint lies in the type of Fund you choose. You need to determine whether to invest in Bulgarian AIFs (Alternative Investment Funds) or Bulgarian ETFs (Exchange-Traded Funds). However, it’s important to note that you cannot split the required 512,000 EUR investment between AIFs and ETFs; it must be allocated entirely to one type.

Fund Portfolio

While there are several Bulgaria Golden Visa Funds available, not all offer the same level of diversification and profitability. Many mainstream funds focus solely on investing in the Bulgaria SOFIX index, which is heavily influenced by government policy decisions. For a more balanced approach, consider funds that limit their exposure to the SOFIX index, maintaining only a minimal stake while diversifying into other high-growth areas.

Benefits of the Bulgaria Golden Visa

Visa-free travel to over 140 countries

High-Return Investment Opportunities

The Bulgaria Golden Visa is a Schengen visa

Your entire family can join you

You are eligible to become a tax resident of Bulgaria

Permanent residency status is indefinite

Minimal Investment Period of 5 years

Minimum Stay Requirements of a single day annually

Understanding ETF Management

ETFs, similar to AIFs, are managed by professional managers, except in cases where AIFs are self-managed. When you invest in an ETF, you entrust your funds to the management team, relying on their expertise to make investment decisions based on the fund’s investment strategy. This delegation of control is a key differentiator between ETFs and certain types of AIFs. This underscores the importance of selecting an ETF that not only meets your risk profile but also has a management style you can trust.

The Role of Professional Management in ETF Investment

Expert Decision-Making: Professional managers use their expertise to navigate market trends and opportunities, potentially enhancing the performance of the ETF.

Lack of Direct Control: As an investor, you have no direct control over the individual investment decisions within the ETF.

Statute-Guided Investments: The statutes of the ETF guide the investment decisions, ensuring a predefined investment strategy is followed.

Engaging with Management in AIF Investments

In contrast to ETFs, some AIFs provide an opportunity for investors to discuss potential investment options with the fund management, offering a more tailored investment experience. However, it’s important to note that while investor input may be considered, it’s not always heeded. The fund management ultimately makes decisions based on what they believe is best for the overall fund performance.

Risks of Investor-Led Requests in AIFs

Allowing investor requests to drive investment decisions in AIFs can be risky. If these requests do not align with the fund’s strategic direction or market realities, they could potentially compromise the fund’s performance and statistics. This underscores the critical balance between investor input and professional management expertise.

Due Diligence

The Bulgarian Investment Agency requires applicants to pass a pre-approval stage before investing in a Bulgarian AIF. Applicants have to provide the following documents and information:

Copy of ID document.
Evidence of sufficient funds meeting or exceeding the minimum investment threshold.
Declaration of Anti-Money Laundering Compliance
Declaration Regarding Politically Exposed Person Status
Detailed information pertaining to employment, professional, and investment activities.
Criminal record certificate issued from the home country and country of permanent residence.

The Bulgarian Investment Agency may require additional documents or information, which the applicant must provide as part of the investment process.

How long is the duration of the Pre-Approval Stage

The pre-approval stage spans a period of 2 to 2.5 months. After successfully completing this stage, you can move forward with your investment for the Bulgarian Golden Visa.

Should you find that the ETF doesn’t align with your investment goals, you may explore the option of investing in real estate in Bulgaria. Opportunities for obtaining the Bulgaria Golden Visa through real estate investment start at 250,000 EUR.

Costs Related to Investment

Depending on your preferred type of investment, the associated costs differ. Below, you can find a table that covers the costs associated with the most popular investment types; real estate acquisition, and Bulgaria Fund Investment:

	Real Estate Property	Investment Fund
Minimum Investment	€312,000/ €250,000	€ 512,000
TAXES
Transfer Tax	up to 3%	0%
Notary Cost	up to € 840	0%
Exit Fees	0%	0%
Performance fee	0%	25% of the profit
Residency processing fee	€ 2,500	€ 5,000
Due diligence	€ 0	€ 0
Management fee	None	1% of the value of investment

The fees are approximate. For the latest rates, please get in touch with us.

Does the Bulgarian Golden Visa Lead to Bulgarian Citizenship?

Investing in a Bulgarian Fund grants you indefinite permanent residency. After holding this status for 5 years and passing a Bulgarian language exam, you become eligible to apply for Bulgarian citizenship by naturalization. Authorities have discontinued previous benefits for investors, such as no language requirements and a fast-track citizenship option.