More than 400 000 companies in Bulgaria headed for extinction at the beginning of 2012 because they missed the deadline for re-registering in the Commercial Register, while several thousand that caught up at the last minute found themselves unable to access their bank accounts as registry officials hurried to catch up with the backlog.
 
Certain entities had four years, until December 31 2011, to comply with the Transitional and Final Provisions of Commercial Registry Act by re-registering. These included sole traders, branches of foreign firms and co-operatives.

Ahead of the deadline, several banks in Bulgaria posted notices warning clients that they would encounter problems if they did not re-register.

One bank, for example, told clients that the law would not allow it to accept payment instructions from clients which had not re-registered, except for transactions involving payments to employees and payments of public liabilities. These instructions would be accepted only in paper form, the bank said.

A few days into the New Year, tens of thousands of businesses found that their bank accounts had been frozen.

While they had submitted their documents ahead of deadline, the last-minute rush created a backlog as Registry Agency officials struggled to complete the processing.

Bulgarian-language media reports put the number of those who had applied for re-registration between December 19 and 31 at about 33 500 companies, most of them small firms and family businesses.

"As required by Bulgarian tradition, we remembered at the last minute that we should re-register," a report by television station bTV put it.

One company told the TV station that with its bank account blocked, payments were being made using the small amount of money that it had in its cash box and by using the personal credit and debit cards of management. The company said that it had been told that it would take at least two weeks before it could access its account.

The Registry Agency said that it expected that the process of re-registering the 33 500 companies would be completed by January 20. Agency staff were working overtime and at weekends to complete the task.

As the December 31 deadline approached, media reports estimated the number of sole-proprietor companies that had not met the deadline at about 400 000. About 100 000 companies, more than 3000 co-operatives and more than 250 branches of foreign companies were said to have missed the deadline.

Within the four-year timeframe, which was extended from the original deadline a number of times, most recently from the end of 2010, more than 454 000 companies re-registered. The process was free-of-charge.

The approach of the deadline saw huge queues, with some people waiting outside Registry Agency offices from 4am, reports said.

Companies that were required by law to re-register that failed to meet the deadline are now forbidden by law to pledge or sell their assets. They will continue to exist, being allowed to pay salaries and debts to the state, but will be wound up. While the process of re-registration was free, being wound up will not be. A liquidator will be appointed for each company, at the cost of the owner, which could run up to about 2000 leva.