In brief
Act 14 confirms that the building has reached the "rough structure" stage (груб строеж), and only from then can ownership be transferred in the built unit itself. Act 15 is a handover protocol from the contractor to the developer and does not permit occupancy. Act 16 and the use permit that follows it are what turn the apartment into a property that may be used, financed and sold. The more you pay before Act 14, the higher the risk, so the payment schedule must be tied to these stages and to protection mechanisms.
Key takeaways
- 1Before Act 14 the buyer usually holds a contractual right or a building right to the unit, not an apartment.
- 2Under Article 181 of the Spatial Development Act, after the rough structure is completed only the built structure and its units can be transferred.
- 3Act 15 is not a residential permit; entering the apartment before a use permit is unlawful.
- 4Act 16 and the use permit allow registration of an address, connection of utilities in your name, financing and a clean sale.
- 5Bulgaria has no general escrow obligation for developers; protection must be built into the contract: an escrow account, a guarantee and release of the mortgage.
What is the difference between Act 14, Act 15 and Act 16?
In brief: Act 14 is the completion of the rough structure, Act 15 is the acceptance of the building from the contractor, and Act 16 is a confirmation that the building is fit for use. The "acts" are numbered forms of protocols drawn up during construction under the Bulgarian regulation on drawing up protocols and documents in construction (Ordinance No. 3 of 2003). The names have become the language of the market, and agents and developers use them to describe the project's status. For an investor, each act is a legal turning point: it determines exactly what you hold and what the risk is on the money you paid.
| Stage | What it confirms | What the buyer usually holds | Level of risk to the funds |
|---|---|---|---|
| Before Act 14 | Construction is under way, a building permit exists | A contractual right under a preliminary agreement, or a building right to the unit in a notarial deed | High |
| Act 14 (rough structure) | Completion of the rough structure: envelope walls and roof | The possibility of receiving a title deed in the unit as a "building in rough structure" | Medium |
| Act 15 | Handover of the building from the contractor to the developer and its fitness for acceptance | Ownership of the unit (if a deed was signed), without a use permit | Medium-low |
| Act 16 and use permit | The building is fit for use and is lawfully put into use | A finished apartment that may be used, financed and sold | Low |
Under Article 181 of the Spatial Development Act, after the rough structure is completed only the built structure and its units can be transferred.
What are you buying before Act 14?
Not an apartment. Before the rough structure is completed, the unit does not yet exist as an independent property. What the buyer holds depends on the structure of the transaction:
- A preliminary agreement only. A contractual right to oblige the developer to transfer the unit in the future. If the developer becomes insolvent, the buyer may become an ordinary creditor.
- A building right to the unit in a notarial deed. A registered proprietary right, which non-EU foreigners may acquire as a "limited property right". It is stronger than a contractual right, and under Article 181(1) of the Spatial Development Act (ЗУТ) it can be transferred from the day it is created until the rough structure is completed.
At this stage you check not only the apartment but the entire project: that the developer is the owner of the land or the holder of a registered building right over it, that the project was approved by the municipality's chief architect, and that the building permit is valid. A building permit in Bulgaria lapses if construction has not begun within three years or if the rough structure has not been completed within five years, so the permit date is relevant to any project that is delayed. You also check whether the land is mortgaged to a bank financing the developer, and on what terms the bank will release each unit.
Act 14: why is the rough structure the turning point?
Because from this moment the unit becomes a property in which ownership can be transferred. Under Article 181(2) of the Spatial Development Act, once the building has been completed to the rough-structure stage, as confirmed in a certificate of the municipality or the district, only the built structure and its independent units can be transferred. The holder of the building right becomes the owner of what was built. From the buyer's perspective, Act 14 is usually the right moment to demand a notarial deed transferring ownership in the unit, even if the building is far from completion.
In the Bulgarian professional literature there is criticism of preliminary agreements that make the "final sale of the building right" conditional on a stage later than the rough structure, such as Act 15 or Act 16. According to this criticism, such an agreement seeks to do what the law prohibits, and may therefore be considered void, with all the consequences for the penalties and compensation set in it. Correct wording distinguishes between a sale of a building right before the rough structure, a transfer of ownership in the unit after it, and a construction contract with the developer to complete the works.
Act 15: can you already live in the apartment?
No. Act 15 records that the contractor handed the building over to the developer and that the building is fit for acceptance, as a stage preceding the process of putting it into use. Moving in or renting out on the basis of Act 15 alone is unlawful. For an investor, Act 15 is a good sign that the project is close to completion, but not a substitute for Act 16. It is worth using it as an inspection stage: an engineering check of the unit, comparison to the specification and a list of defects to be fixed before the final payment.
Act 16 and the use permit: what do they unlock?
Act 16 is the protocol of the acceptance committee, on the basis of which a use permit (разрешение за ползване) is issued. As a rule, for buildings in the higher categories the permit is issued by the National Construction Supervision Directorate (ДНСК), and for smaller buildings the municipality issues a certificate of commissioning. Only from here is the apartment a full property:
- Lawful use for residence or rental.
- Registration of an address and connection of electricity, water and gas in the owner's name.
- Bank financing, since most banks do not finance a property without a use permit.
- A clean future sale, without questions from a buyer and his bank.
- The start of the developer's and contractor's warranty periods for defects.
The practical rule is therefore simple: the large part of the price is not paid before the use permit is issued, or at least before Act 16 is signed and the permit is in a defined process.
How do you build a payment schedule that protects the money?
Bulgarian law does not oblige developers to deposit buyers' funds in an escrow account or to provide a bank guarantee as a condition for an off-plan sale. Protection is therefore built in the contract. Principles we apply:
- A small payment before the rough structure, and only after the right has been registered or suitable security has been given.
- A significant payment at Act 14, subject to signing the title deed in the unit and registering it.
- A further payment at Act 15, subject to an engineering inspection and the specification.
- The balance at the use permit, or a short period after it, with a sum withheld to remedy defects.
- A release letter from the financing bank undertaking to delete the mortgage on the unit upon payment.
- An escrow account with a notary under Article 25a of the Notaries Act, or a bank guarantee for a new developer or a "project company".
- Agreed compensation for delay, and a right of cancellation with refund if the rough structure or the permit is not obtained by a target date.
There is no single formula for dividing the percentages, and it depends on the developer's strength and the security he provides. What matters is that every payment is tied to a legal event that can be verified in a document, and not to the developer's declaration on the "progress of the works".
What else do you check in a contract with a developer?
- An area and price table specifying how the area was calculated, including the share in the common areas, because prices in Bulgaria are often quoted by "gross" area.
- VAT - a new apartment is subject to 20% VAT. Make sure the price includes it.
- A binding technical specification, including the finish level, and what counts as "shell" and what as "turnkey".
- Future management fees and a management contract, especially in resort complexes.
- Copies of all the construction documents, needed for claims during the warranty periods.
- The developer's background - previous projects, claims, and whether a new dedicated company was established for the project.
The Israeli aspect: payments from Israel and documentation
An Israeli investor who pays a developer in Bulgaria in instalments over a year or two needs to keep an orderly file: every transfer from Israel, the reference for the stage to which it is tied, and the document that confirmed the stage. This documentation serves three purposes: proving the source of funds to the bank in Israel, substantiating the purchase cost for capital gains tax in Bulgaria and in Israel on a future sale, and a basis for a claim if the developer breaches. Since 2026 payments are made in euros without an internal conversion in Bulgaria, so the documentation is also simpler.
What to do before signing, and how we accompany you
Before signing with a Bulgarian developer you must examine the project and not only the apartment: land, permit, financing and developer. We accompany off-plan purchases in Bulgaria with the experience of someone who develops projects himself. We examine the developer's rights and the permits, build a payment schedule tied to the legal stages, demand security and release letters, and follow each act through to the use permit and registration.
The contents of this article are general information and do not constitute legal advice, tax advice or an investment recommendation, and should not be relied upon for a specific case. The law, tax rates and tariffs in Bulgaria and in Israel change from time to time, and personal circumstances may change the outcome. Before any decision or signature, obtain advice tailored to your case.
Frequently asked questions
What is Act 16 in Bulgaria?
Act 16 is the protocol that determines that a new building is fit for use. On its basis a use permit or a certificate of commissioning is issued, and only then may one live in the apartment, connect utilities in the owner's name, obtain financing and sell cleanly.
When do you receive a title deed to an off-plan apartment in Bulgaria?
Usually after Act 14, when the building has been completed to the rough-structure stage and there is a certificate to that effect from the municipality. Before that, one can acquire a contractual right or a building right to the unit, and under Article 181 of the Spatial Development Act the building right can be transferred only until the rough structure is completed.
Is it permitted to live in the apartment after Act 15?
No. Act 15 records the handover of the building from the contractor to the developer, but using the building before it is lawfully put into use, that is, before Act 16 and the use permit, is unlawful.
Are developers in Bulgaria required to deposit the money in escrow?
We have not found such a general obligation in Bulgarian law. Protection is built in the contract: an escrow account with a notary or at a bank, a bank guarantee, a release letter from the financing bank and a payment schedule tied to legal stages.
How much is it worth paying before the rough structure is completed?
There is no fixed percentage in the law, but the more you pay before Act 14, the higher the risk. It is recommended to keep the pre-structure payment small and tie it to security, and to pay most of the price on the transfer of ownership and at the use permit.
Read next · 10 min readReal Estate Development in Sofia: Planning and Construction, Permits and Legal Considerations for a ProjectAn Israeli developer in Sofia: holding land when a non-EU foreigner cannot buy it, the permit route to a use permit, contracts, off-plan sales and exit tax.Read the guideSources
- CMS - Acquisition of Off-Plan Property in Bulgaria
- Trud i Pravo - Preliminary contract for sale of a right to build (Spatial Development Act Art. 181)
- ELRA - Bulgaria: Limitations to Foreigners (limited rights in rem for foreigners)
- Legal500 - The notary public as escrow agent in real estate transactions (Notary Act Art. 25a)
- Ellty - Property due diligence checklist Bulgaria (2026)
- VLO Law Firm - Bulgaria real estate guide (2026)
The information in this guide is general in nature and does not constitute legal or tax advice on any specific transaction. Every transaction is assessed on its own facts.