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Bulgaria's Solid Start: A Buzz Interview with Dimitar Kaldamukov of KBDM Law

Bulgaria's Solid Start: A Buzz Interview with Dimitar Kaldamukov of KBDM Law

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After a few years of political struggle, Bulgaria seems to be on a good path, with interesting legislative updates on the horizon and promising M&A activity levels, spurred primarily by strong activity in the energy and IT sectors, according to KDBM Law Founding Partner Dimitar Kaldamukov.

“It's been a challenging period,” Kaldamukov begins, alluding to the political turmoil Bulgaria experienced in the past several years. “However, the formation of a coalition between the two biggest parties, both pro-liberal and pro-EU, has brought much-needed stability – this political and legal reinforcement has significantly boosted investor confidence.”

Building on these confidence levels, Kaldamukov reports a surge in foreign investments. “Last year was pivotal,” he says. “The influx of investments coincided with the EU Resilience and Recovery Plan, injecting billions of euros into our economy.” According to him, this is also partly because of Bulgaria's transition from a coal-based to a renewable energy economy. “We hit record levels in renewable energy, with a significant portion of our energy now coming from renewable sources.” Consequently, he reports that Bulgaria is “rapidly advancing towards a renewable energy market.”

Focusing on IT, Kaldamukov says that Bulgaria has “long been a regional IT hub, but the market has recently become oversaturated. The influx of Ukrainian specialists has introduced more competition, leading to a cooling down of the software labor market,” he explains.

Having these two sectors in mind, Kaldamukov reports this is precisely where most M&A activity has taken place. “We anticipate more M&A in software, particularly in outsourcing, and further development in renewable energy installations.”

Turning his attention to recent legislative matters of note, Kaldamukov focuses on the recent entry of the country into the Schengen area. “This is a significant milestone yet still a complex issue,” he says. “While it's a political and legal success, it has sparked debate. The majority of Bulgarians travel by car, and Schengen checks will primarily affect road travel,” he explains. “Regardless, it's a step forward for Bulgaria.”

Additionally, Kaldamukov reports that he expects an imminent “implementation of the EU FDI regulations. This will introduce a new regime for investments above a certain threshold, significantly impacting the market.” He also adds that “anti-money laundering laws are becoming stricter, getting fully in line with EU rules, complicating foreign investment and company registration processes.”

Bulgaria Knowledge Partner

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