The merchant according to Bulgarian Commercial Law

In Bulgaria, the merchant is the main participant in commerce. His activities and legal status are subject to a special legal order. According to Article 1 of the Commercial Act, the following three conditions determinate this legal character:

- The merchant is a subject of civil law – a natural or legal person or legal entity;

- The merchant is engaged in one of the businesses listed under Article 1 (1) of the Commercial Act;

- The business is organized professionally for gain (even if not listed under Art. 1, para.1).

If the merchant is a natural person, he must be legally competent and legally liable to participate in trade and commerce. Regarding legal persons, these two conditions are fulfilled with the establishment of their legal entity.

Another condition for the legal individualisation as a merchant is the conduct of certain types of transactions. The focus is on the commercial transactions listed in Article 1 (1) of the Commercial Act. Paragraph 3 of this Article provides the exceptions to this prescription. Accordingly, persons are also assessed as merchants if their business establishment requires a commercial organization by its nature and extent.

A general characteristic of each merchant is the commercial conduct of the transactions. Hence, these transactions have to be regularly conducted, and coincidentally, and with the aim of making a profit. This applies for natural persons as well as for legal entities. The last category – commercial subjects – is recognized as merchant only due to their form of organisation as trading companies or associations.

Persons that are not considered to be merchants are precisely enumerated in Article 2 of the Commercial Act. Their main feature is the performance of personal work and the lack of a commercially organised business establishment. These include e.g. natural persons engaged in farming, freelancer, persons providing hotel services by renting rooms in their own home etc. The last restriction does not include the commercial renting of rooms.

Further, according to Bulgarian commercial law merchants can be classified in two groups – merchants with regards to their business (commercial transactions or business establishments that require a commercially organization) and merchants as to their incorporation. The second group included all types of companies defined in Article 64 of the Commercial Act: general partnerships, limited partnerships, companies with limited liability, joint stock companies, and limited stock partnership.