Spasov & Bratanov successfully defended an individual against a claim for invalidity of the contract, on the basis of which this individual acquired interest in a limited liability company. The claim was brought against our client by the seller, who transferred the interest at its nominal value (i.e. that is the value recorded in the Commercial Register). Several years after the transfer, the seller challenged the transaction at court as contrary to the good morals due to significant difference between the agreed price and the actual value of the interest. With regard to the calculation of the actual value of the interest, the main issue under the dispute was whether the specific shareholder loan, provided by the seller to the company in the form of additional monetary contribution (in Bulgarian: допълнителна парична вноска), shall be regarded as equity (or not) and if this contribution shall be taken into account for the purpose of the calculation of the net value. The court upheld the arguments of our client that the monetary contribution of the shareholder shall not be considered as equity and in result the client kept his interest and the capacity of a shareholder in the company. Kremena Yaneva-Ivanova, Senior Associate, advised and represented the client on this matter.

Date: August 2023

Source: Spasov & Bratanov Lawyers’ Partnership